Exhibit
10.1


 


STOCK
PURCHASE AGREEMENT


 


BY
AND AMONG


 


CONFUCIUS
PLAZA MEDICAL LABORATORY CORP.,


 


PRIDE
DIAGNOSTICS LLC,


 


THE
MEMBERS OF PRIDE DIAGNOSTICS LLC,


 


AND


 


ProPhase
Diagnostics, Inc.


 


DATED
AS OF


 


OCTOBER
22, 2020


 




    	 



     


    

 


TABLE
OF CONTENTS


 


	 	Page
	 	 
	ARTICLE
    I DEFINITIONS	1
	Section
    1.1   Defined Terms; Cross References	1
	 	 
	ARTICLE
    II PURCHASE AND SALE	1
	Section
    2.1   Purchase and Sale of Shares	1
	Section
    2.2   Purchase Price	1
	Section
    2.3   Post-Closing Adjustment	1
	 	 
	ARTICLE
    III CLOSING	2
	Section
    3.1   Closing	2
	Section
    3.2   Conditions to Obligations of Buyer	2
	Section
    3.3   Conditions to Obligations of the Seller Parties	4
	 	 
	ARTICLE
    IV REPRESENTATIONS AND WARRANTIES OF THE SELLER PARTIES	5
	Section
    4.1   Authorization; Enforceability	5
	Section
    4.2   Noncontravention	6
	Section
    4.3   Ownership	6
	Section
    4.4   Legal Proceedings	6
	Section
    4.5   No Broker	7
	Section
    4.6   Full Disclosure	7
	 	 
	ARTICLE
    V REPRESENTATIONS AND WARRANTIES OF THE COMPANY	7
	Section
    5.1   Organization; Authorization; Enforceability	7
	Section
    5.2   Noncontravention	8
	Section
    5.3   Capitalization; Subsidiaries	8
	Section
    5.4   Financial Statements; Books and Records	9
	Section
    5.5   No Undisclosed Liabilities; Indebtedness and Liens	9
	Section
    5.6   Absence of Certain Changes	10
	Section
    5.7   Material Contracts	11
	Section
    5.8   Legal Proceedings	14
	Section
    5.9   Compliance with Laws	14
	Section
    5.10 Company Licenses	14
	Section
    5.11 Title to and Sufficiency of Assets; Condition of Assets	14
	Section
    5.12 Real Property	15
	Section
    5.13 Intellectual Property	15
	Section
    5.14 Tax Matters	15
	Section
    5.15 Environmental Matters	18
	Section
    5.16 Business Personnel	19
	Section
    5.17 Labor Matters	19
	Section
    5.18 Employee Benefit Matters	20
	Section
    5.19 Insurance Matters	20
	Section
    5.20 Related Party Transactions; Potential Conflicts of Interest	21
	Section
    5.21 Unlawful Payments	21
	Section
    5.22 Bank Accounts; Powers of Attorney	21
	Section
    5.23 No Broker	21


 




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	Section
    5.24 Accounts Receivable	21
	Section
    5.25 Top Customers and Top Suppliers	21
	Section
    5.26 Full Disclosure	22
	 	 
	ARTICLE
    VI REPRESENTATIONS AND WARRANTIES OF BUYER	22
	Section
    6.1   Organization; Authorization; Enforceability	22
	Section
    6.2   Noncontravention	22
	Section
    6.3   Legal Proceedings	23
	Section
    6.4   No Broker	23
	 	 
	ARTICLE
    VII COVENANTS	23
	Section
    7.1   Public Announcements	23
	Section
    7.2   Restrictive Covenants	25
	Section
    7.3   Further Assurances	25
	Section
    7.4   Release of Claims	25
	Section
    7.5   Tax Matters	26
	Section
    7.6   Conduct of Business Prior to Closing	31
	Section
    7.7   Approvals and Consents	31
	Section
    7.8   Notice of Certain Events	31
	Section
    7.9   Access to Information	31
	Section
    7.10 Additional Covenants	32
	 	 
	ARTICLE
    VIII INDEMNIFICATION	32
	Section
    8.1   Survival	32
	Section
    8.2   Indemnification by the Seller Parties	32
	Section
    8.3   Indemnification by Buyer	33
	Section
    8.4   Indemnification Procedures	33
	Section
    8.5   Exclusive Remedy	34
	Section
    8.6   Additional Indemnification Provisions	34
	 	 
	ARTICLE
    IX MISCELLANEOUS	34
	Section
    9.1   Termination	34
	Section
    9.2   Notices	35
	Section
    9.3   Expenses	35
	Section
    9.4   Interpretation	36
	Section
    9.5   Tables and Headings	36
	Section
    9.6   Severability	36
	Section
    9.7   Entire Agreement	36
	Section
    9.8   Successors and Assigns	36
	Section
    9.9   No Third Party Beneficiaries	37
	Section
    9.10 Amendment and Modification; Waiver	37
	Section
    9.11 Governing Law; Submission to Jurisdiction; Waiver of Jury Trial	37
	Section
    9.12 Specific Performance	38
	Section
    9.13 Seller Party Representative; Power of Attorney	38
	Section
    9.14 Entire Agreement	39
	Section
    9.15 Counterparts	39


 




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STOCK
PURCHASE AGREEMENT


 


THIS
STOCK PURCHASE AGREEMENT (this “Agreement”), dated as of October 22, 2020, is made by and among Confucius Plaza
Medical Laboratory Corp., a New York corporation (the “Company”), Pride Diagnostics LLC (the “Selling
Company”), Nelson Herrera, Arvind Gurnani and Michael Messina (together with the Selling Company, each a “Seller
Party” and collectively, the “Seller Parties”), Arvind Gurnani, not individually but in the capacity
as representative of the Seller Parties hereunder, and ProPhase Diagnostics, Inc., a Delaware corporation (“Buyer”).


 


RECITALS


 


A.
The Selling Company is the record and beneficial owner of all of the issued and outstanding shares of all capital stock of the
Company (the “Shares”).


 


B.
Upon the terms and subject to the conditions set forth in this Agreement, the Seller Parties desire to sell to Buyer, and Buyer
desires to purchase from the Seller Parties, the Shares.


 


Now,
therefore, the parties hereto hereby agree as follows:


 


ARTICLE
I


DEFINITIONS


 


Section
1.1 Defined Terms; Cross References. Each of the defined terms used and/or referenced in this Agreement are set forth on
Schedule 1.1. 


 


ARTICLE
II

PURCHASE AND SALE


 


Section
2.1 Purchase and Sale of Shares. Upon the terms and subject to the conditions set forth in this Agreement, at the Closing,
Buyer shall purchase and acquire from the Selling Company, and the Selling Company shall sell, assign, transfer, convey, and deliver
to Buyer, all of the Shares, free and clear of any and all Liens other than restrictions on transfer imposed by applicable securities
Laws. 


 


Section
2.2 Purchase Price. Subject to adjustment pursuant to Section 2.3, the aggregate purchase price for the Shares will
be Two Million Five Hundred Thousand Dollars ($2,500,000), minus any outstanding Indebtedness of the Company as of the
Closing, minus any Transaction Expenses owed and unpaid by the Company as of the Closing, plus any cash in the Company’s
bank account (as adjusted, the “Purchase Price”) 


 


Section
2.3 Post-Closing Adjustment. As of the Closing, the Company does not have any accounts payable or knowledge of any accounts
payable that may arise. The parties shall cooperate in good faith to reconcile any and all of the Company’s accounts payable
and receivable that have arisen due to operations of the Company prior to the Closing by November 1, 2021. In the event that,
after taking into account the deductions of Indebtedness and Transaction Expenses pursuant to Section 2.2, the reconciled
accounts payable and receivable figures show an excess, then such excess shall be considered an increase to the Purchase Price
and distributed pursuant to this Agreement; provided, however, that if the reconciled accounts payable and receivable figures
show a deficit, then such deficit shall be considered a deduction to the Purchase Price and deducted prior to Buyer making any
payments to the Seller Parties pursuant to this section.  


 




    	 



     


    

 


ARTICLE
III


CLOSING


 


Section
3.1 Closing. Subject to the terms and conditions of this Agreement, the consummation of the Contemplated Transactions (the
“Closing”) will take place remotely via the exchange of executed documents and other deliverables by the parties
no later than two (2) Business Days after the last of the conditions set forth in Section 3.2 through Section 3.3 have
been satisfied or waived (other than closing deliveries which, by their nature, are to be satisfied on the date of Closing) (the
“Closing Date”). The Closing will be deemed effective as of 12:01 a.m. Eastern Time on the Closing Date (the
“Effective Time”). All documents delivered and actions taken at the Closing shall be deemed to have been delivered
or taken simultaneously at the Effective Time.


 


Section
3.2 Conditions to Obligations of Buyer. The obligations of Buyer to consummate the transactions contemplated by this Agreement
shall be subject to the fulfillment or Buyer’s waiver, at or prior to the Closing, of each of the following conditions:


 


(a)
no Governmental Authority shall have enacted, issued, promulgated, enforced or entered any Law or order which is in effect and
has the effect of making the transactions contemplated by this Agreement illegal, otherwise restraining or prohibiting consummation
of such transactions or causing any of the transactions contemplated hereunder to be rescinded following completion thereof;


 


(b)
the representations and warranties of the Seller Parties and the Company contained in this Agreement and Ancillary Agreements
and any certificate or other writing delivered pursuant hereto shall be true and correct in all respects on and as of the date
hereof and on and as of the Closing Date with the same effect as though made at and as of such date (except those representations
and warranties that address matters only as of a specified date, the accuracy of which shall be determined as of that specified
date in all respects);


 


(c)
each Seller Party and the Company shall have duly performed and complied in all material respects with all agreements, covenants
and conditions required by this Agreement and each of the Ancillary Agreements to be performed or complied with by it prior to
or on the Closing Date;


 


(d)
Buyer is satisfied, in its sole discretion, that the Company and Seller Parties, as applicable, meet all requisite auditability
standards applicable to Buyer and/or in connection with an acquisition of this type made by Buyer,


 


(e)
no Action shall have been commenced against Buyer, the Seller Parties or the Company, which would prevent the Closing and there
exists no injunction or restraining order by any Governmental Authority that restrains or prohibits any of the Contemplated Transactions;


 




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(f)
no event or circumstance has occurred that, individually or in the aggregate, with or without the lapse of time, could reasonably
be expected to result in a material adverse effect on the Company or Business; and


 


(g)
the Seller Parties shall deliver, or cause to be delivered, the following:


 


(i)
the original stock certificate(s) evidencing the Shares, together with assignments separate from certificate or other transfer
documents executed by the Seller Parties relating to the Shares, in form and substance reasonably satisfactory to Buyer;


 


(ii)
a certificate of good standing for the Company issued as of a date that is no more than five (5) Business Days before the Closing
Date by the Secretary of State of the State of New York, New Jersey and each other jurisdiction listed on Schedule 5.1(a);


 


(iii)
a copy of the Company’s articles of incorporation, including all amendments thereto, certified as of a date that is no more
than five (5) Business Days before the Closing Date by the Secretary of State of the State of New York;


 


(iv)
a certificate by an officer of the Company, dated the Closing Date, in form and substance reasonably satisfactory to Buyer, certifying
(i) the Company’s Organizational Documents in effect as of the Closing Date, (ii) the resolutions duly adopted by the board
of directors of the Company and shareholders of the Company authorizing and approving the execution, delivery, and performance
of this Agreement and each Ancillary Agreement to which the Company is a party and the consummation of the Contemplated Transactions,
which resolutions shall have been certified as true, correct, and in full force and effect without rescission, revocation, or
amendment as of the Closing Date; (iii) the incumbency and signatures of the officers of the Company authorized to execute and
deliver this Agreement and each Ancillary Agreement to which the Company is a party and (iv) that each of the conditions set forth
in Sections 3.2(b) and (c) have been satisfied;


 


(v)
a resignation and release effective as of the Closing of the officers and directors of the Company identified by the Buyer prior
to the Closing Date, duly executed by each such officer and director;


 


(vi)
the minute books, stock ledgers and registers, and other corporate records of the Company;


 


(vii)
a properly completed and executed IRS Form W-9 from each Seller Party and a certificate, in form and substance reasonably satisfactory
to Buyer, as to the non-foreign status of each Seller Party pursuant to Treasury Regulation 1.1445-2(b)(2), duly executed by such
Seller Party;


 


(viii)
the consents, waivers and approvals required to be obtained by the Seller Parties and/or the Company with respect to the consummation
of the Contemplated Transactions that are set forth on Schedule 3.2(g)(viii), each in form and substance reasonably satisfactory
to Buyer;


 




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(ix)
the Ancillary Agreements, duly executed by the parties thereto other than the Buyer;


 


(x)
assignment and/or a new lease in favor of the Company for the Leased Real Property, duly executed by the landlord;


 


(xi)
employment agreements, consulting agreements, and/or offer letters with those certain employees and/or consultants that have working
relationships with the Seller Parties and perform services for the Company and its Business, each of which to Buyer’s satisfaction
and duly executed by such employees and/or consultants, and


 


(xii)
such other certificates, documents, or instruments as Buyer may reasonably request.


 


Section
3.3 Conditions to Obligations of the Seller Parties. The obligations of the Seller Parties to consummate the transactions
contemplated by this Agreement shall be subject to the fulfillment or their waiver, at or prior to the Closing, of each of the
following conditions:


 


(a)
no Governmental Authority shall have enacted, issued, promulgated, enforced or entered any Law or order which is in effect and
has the effect of making the transactions contemplated by this Agreement illegal, otherwise restraining or prohibiting consummation
of such transactions or causing any of the transactions contemplated hereunder to be rescinded following completion thereof;


 


(b)
the representations and warranties of the Buyer contained in this Agreement and Ancillary Agreements and any certificate or other
writing delivered pursuant hereto shall be true and correct in all respects on and as of the date hereof and on and as of the
Closing Date with the same effect as though made at and as of such date (except those representations and warranties that address
matters only as of a specified date, the accuracy of which shall be determined as of that specified date in all respects);


 


(c)
Buyer shall have duly performed and complied in all material respects with all agreements, covenants and conditions required by
this Agreement and each of the Ancillary Agreements to be performed or complied with by it prior to or on the Closing Date;


 


(d)
no Action shall have been commenced against Buyer, the Seller Parties or the Company, which would prevent the Closing and there
exists no injunction or restraining order by any Governmental Authority that restrains or prohibits any of the Contemplated Transactions;
and


 


(e)
the Buyer shall deliver, or cause to be delivered, the following


 


(i)
to the Seller Party Representative, a certificate of good standing for Buyer issued as of a date that is no more than five (5)
Business Days before the Closing Date by the Secretary of State of the State of Delaware;


 


(ii)
to the Seller Party Representative, a certificate of an officer of Buyer, dated the Closing Date, in form and substance reasonably
satisfactory to the Seller Party Representative, certifying (i) the resolutions duly adopted by the board of managers (or other
equivalent governing body) of Buyer authorizing and approving the execution, delivery, and performance of this Agreement and each
Ancillary Agreement to which Buyer is a party and the consummation of the Contemplated Transactions, which resolutions shall have
been certified as true, correct, and in full force and effect without rescission, revocation, or amendment as of the Closing Date;
(ii) the incumbency and signatures of the officers of Buyer authorized to execute and deliver this Agreement and each Ancillary
Agreement to which Buyer is a part and (iii) that each of the conditions set forth in Sections 3.3(b) and (c) have
been satisfied;


 




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(iii)
pay to each payee of Company Transaction Expenses and each holder of Indebtedness of the Company, any outstanding amounts owed
as of the Closing in order to fully satisfy such obligations; and


 


(iv)
to the Seller Parties, in accordance with their respective Pro Rata Percentages, the Purchase Price, by wire transfer of immediately
available funds to the account or accounts specified in writing at least five (5) Business Days prior to the Closing Date.


 


ARTICLE
IV


REPRESENTATIONS
AND WARRANTIES OF THE SELLER PARTIES


 


As
a condition and material inducement to Buyer’s willingness to enter into this Agreement and each Ancillary Agreements to
which it is a party and to consummate the Contemplated Transactions, each Seller Party hereby jointly and severally represents
and warrants to Buyer as follows:


 


Section
4.1 Authorization; Enforceability.


 


(a)
Such Seller Party has the requisite right, power, and authority to execute and deliver this Agreement and each Ancillary Agreement
to which such Seller Party is a party, to perform such Seller Party’s obligations hereunder and thereunder, and to consummate
the Contemplated Transactions.


 


(b)
This Agreement and each Ancillary Agreement to which such Seller Party is a party has been duly and validly executed and delivered
by such Seller Party, and (assuming due authorization, execution, and delivery by Buyer and each of the other parties thereto)
this Agreement constitutes, and each such Ancillary Agreement (assuming due authorization, execution, and delivery by the other
parties thereto) constitutes, the legal, valid, and binding obligation of such Seller Party, enforceable against such Seller Party
in accordance with their respective terms, subject to the Enforceability Exceptions. The execution, delivery, and performance
of this Agreement and each Ancillary Agreement and the consummation of the Contemplated Transactions have been duly and validly
authorized by all requisite action, and no other proceedings on such Seller Party’s part are necessary to authorize the
execution, delivery, or performance of this Agreement or such Ancillary Agreements.


 




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Section
4.2 Noncontravention.


 


(a)
The execution, delivery, and performance by such Seller Party of this Agreement and each Ancillary Agreement to which such Seller
Party is a party, and the consummation by such Seller Party of the Contemplated Transactions, do not and will not (i) contravene,
conflict with, violate, or result in a breach of any Law; (ii) subject to the matters referred to on Schedule 4.2(b), require
any consent of, notice or payment to, or other action by any Person under, contravene, conflict with, violate, result in a breach
of the terms, conditions or provisions of, constitute a default (or an event that with or without notice or lapse of time or both
would become a default) under, or give rise to any rights of acceleration, amendment, termination or cancellation, or to a loss
of any rights under, any Contract or License to which such Seller Party is a party or by which such Seller Party or any of such
Seller Party’s assets or properties is bound; or (iii) result in the creation or imposition of any Lien upon any of the
Shares or other assets of such Seller Party.


 


(b)
Except as set forth on Schedule 4.2(b), no consent, approval, or authorization of, or registration, declaration or filing
with, or notice to, any Governmental Authority or any other Person is required to be obtained, made, or given by such Seller Party
as a result of or in connection with such Seller Party’s execution, delivery, and performance of this Agreement or any Ancillary
Agreement to which such Seller Party is a party or consummation of the Contemplated Transactions.


 


Section
4.3 Ownership.


 


(a)
The Selling Company is the record and beneficial owner of, and has good and valid title to, all of the Shares set forth opposite
its name on Schedule 4.3(a), free and clear of any and all Liens other than restrictions on transfer imposed under applicable
securities laws. Schedule 4.3(a) also sets forth such Seller Party’s Pro Rata Percentage. At the Closing, the Selling
Company will transfer and deliver to Buyer good and valid title to the Shares, free and clear of any and all Liens other than
restrictions on transfer imposed under applicable securities laws. The Selling Company is not a party to or otherwise bound by
any Contract that limits, restricts, or pertains to such Seller Party’s right to transfer the Shares set forth opposite
its name on Schedule 4.3(a) to Buyer pursuant to this Agreement.


 


(b)
Schedule 4.3(b) sets forth (i) each Equity Security held by such Seller Party in any private company that has any operations
that are competitive with the Business, or which are a reasonable extension of the business currently conducted by the Company
or proposed to be conducted by the Company as of the Closing (each, a “Specified Entity”), (ii) the percentage
of the issued and outstanding Equity Securities of any such Specified Entity that is held by such Seller Party, and (iii) a reasonably
detailed description of the business conducted by any such Specified Entity.


 


Section
4.4 Legal Proceedings. There is no Action pending or, to the knowledge of such Seller Party, threatened against, or affecting
such Seller Party that, if determined or resolved adversely to such Seller Party, would adversely affect such Seller Party’s
ability to perform such Seller Party’s obligations hereunder or under any Ancillary Agreement to which such Seller Party
is a party, or to timely consummate the Contemplated Transactions. Such Seller Party is not subject to or otherwise bound by any
order, injunction, judgment, settlement, or decree that prohibits or limits the conduct of the Business or the ownership or use
of the Shares held by such Seller Party or any of the assets or properties of the Company.


 




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Section
4.5 No Broker. No broker, finder, investment banker, or other intermediary is entitled or has claimed to be entitled to
any fee or commission in connection with the Contemplated Transactions based upon arrangements made by or on behalf of such Seller
Party.


 


Section
4.6 Full Disclosure. No representation or warranty by such Seller Party in this Agreement and no statement contained in
the Schedules to this Agreement or any certificate or other document furnished to or to be furnished to Buyer pursuant to this
Agreement contains any untrue statement of a material fact, or omits to state a material fact necessary to make the statements
contained therein, in light of the circumstances in which that are made, not misleading.


 


ARTICLE
V


REPRESENTATIONS
AND WARRANTIES OF THE COMPANY


 


As
a condition and material inducement to Buyer’s willingness to enter into this Agreement and to enter into each Ancillary
Agreement to which it is a party and to consummate the Contemplated Transactions, the Company and the Seller Parties hereby jointly
and severally represent and warrant to Buyer as follows:


 


Section
5.1 Organization; Authorization; Enforceability.


 


(a)
The Company (i) is a corporation duly incorporated, validly existing, and in good standing under the laws of the State of New
York; (ii) has the requisite corporate power and authority and possesses all Licenses necessary to own, lease, or otherwise hold
its assets and properties and to carry on its business as currently conducted; and (iii) is duly qualified or licensed to do business
and is in good standing as a foreign corporation in each jurisdiction set forth on Schedule 5.1(a), which are the only
jurisdictions in which the ownership, leasing, or holding of its assets and properties or the conduct of its business makes such
qualification or licensing necessary under applicable Law.


 


(b)
The Company has made available to Buyer a true, complete and correct copy of (i) the Company’s Organizational Documents,
each as amended to date, and (ii) the minutes of all meetings of and other corporate actions taken by the shareholders, board
of directors and committees of the board of directors or similar governing bodies of the Company during the past five (5) years.
The Company is not in breach of or default under any provision of its Organizational Documents. Schedule 5.1(b) sets forth
a correct and complete list of the officers, directors, managers and similar functionaries of the Company.


 


(c)
The execution, delivery, and performance by the Company of this Agreement and each Ancillary Agreement to which the Company is
a party and the consummation by the Company of the Contemplated Transactions are within the Company’s corporate powers and
have been duly and validly authorized and approved by all necessary corporate action on the part of the Company.


 




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(d)
This Agreement and each Ancillary Agreement to which the Company is a party has been duly and validly executed and delivered by
the Company, and this Agreement (assuming due authorization, execution, and delivery by the Buyer) and each such Ancillary Agreement
(assuming due authorization, execution, and delivery by the other parties thereto) constitute the legal, valid, and binding obligation
of the Company, enforceable against the Company in accordance with their respective terms, subject to the Enforceability Exceptions.


 


Section
5.2 Noncontravention.


 


(a)
The execution, delivery, and performance by the Company of this Agreement and each Ancillary Agreement to which the Company is
a party, and the consummation by the Seller Parties and the Company of the Contemplated Transactions, do not and will not (i)
contravene, conflict with, violate, or result in a breach of any provision of the Company’s Organizational Documents; (ii)
contravene, conflict with, violate, or result in a breach of any Law; (iii) subject to the matters referred to on Schedule
5.2(b), require any consent of, notice or payment to, or other action by any Person under, contravene conflict with, violate,
result in a breach of the terms, conditions or provisions of, constitute a default (or an event that with or without notice or
lapse of time or both would become a default) under, or give rise to any rights of acceleration, amendment, termination or cancellation,
or to a loss of any rights under, any Contract or License to which the Company is a party or by which the Company or any of its
assets or properties is bound; or (iv) result in the creation or imposition of any Lien upon any of the Shares or any of the assets
or properties of the Company.


 


(b)
Except as set forth on Schedule 5.2(b), no consent, approval, or authorization of, or registration, declaration or filing
with, or notice to, any Governmental Authority or any other Person is required to be obtained, made, or given by the Company as
a result of or in connection with the Company’s and the Seller Parties’ execution, delivery, and performance of this
Agreement or any Ancillary Agreement to which the Company or any Seller Party is a party or the consummation of the Contemplated
Transactions.


 


Section
5.3 Capitalization; Subsidiaries.


 


(a)
Schedule 5.3(a) sets forth (i) the number of authorized Equity Securities of the Company, and (ii) the number of issued
and outstanding Equity Securities of the Company and the holders thereof, all of which are owned collectively by the Seller Parties
and constitute the Shares. All of the Shares (A) have been duly authorized, (B) are validly issued, fully paid, and non-assessable,
(C) were issued in compliance with or pursuant to an exemption from all applicable federal and state securities laws, (D) were
not issued in violation of any preemptive rights or any purchase option, call option, right of first refusal, or offer or other
similar right, and (E) are owned beneficially and of record by the Seller Parties as set forth on Schedule 4.3(a), free
and clear of all Liens other than restrictions on transfer imposed by applicable securities laws. At the Closing, the Seller Parties
will transfer and deliver to Buyer good and valid title to the Shares, free and clear of any and all Liens other than restrictions
on transfer imposed by applicable securities laws. Except for the Shares, there are no Equity Securities of the Company issued,
outstanding, or reserved for issuance.


 




    	-8-



     


    

 


(b)
The Company does not have any subsidiaries and does not own or hold the right to acquire any Equity Securities of, or otherwise
have any ownership interest in, any other Person.


 


Section
5.4 Financial Statements; Books and Records. Attached to Schedule 5.4 are true, correct, and complete copies of: (i) the
balance sheet of the Company as of December 31, 2019 (the “Most Recent Fiscal Year End”), December 31, 2018
and December 31, 2017, and the related statements of income and comprehensive income, changes in stockholders’ equity, and
cash flows for the fiscal years then ended (collectively, the “Reviewed Financial Statements”); and (ii) the
balance sheet of the Company as of September 30, 2020, (the “Latest Balance Sheet Date”, and such balance sheet,
the “Latest Balance Sheet”) and the related statements of income and comprehensive income, changes in stockholders’
equity, and cash flows for the nine (9)-month period then ended (collectively, the “Interim Financial Statements”).
The Reviewed Financial Statements and the Interim Financial Statements are herein collectively referred to as the “Financial
Statements”. Each of the Financial Statements was prepared on the basis of and in accordance with the books and records
of the Company kept in the Ordinary Course, and fairly presents in all material respects the financial condition of the Company
as of its respective date and the results of operations and cash flows of the Company for the periods related thereto, in each
case using the same accounting methods, policies, practices, and procedures, with consistent classifications, judgments, and estimation
methodology, as were used in the preparation of the Reviewed Financial Statements for the Most Recent Fiscal Year End, except
in the case of the Interim Financial Statements for the absence of footnote disclosures and year-end adjustments, none of which
would be material, individually or in the aggregate. The accounting practices of the Company have been consistently applied for
all periods represented by the Financial Statements. The Company’s books and records are complete and correct and accurately
reflect all of the assets, Liabilities, transactions, and results of operations of the Business, and the Financial Statements
have been prepared and presented based upon and in conformity therewith. 


 


Section
5.5 No Undisclosed Liabilities; Indebtedness and Liens.


 


(a)
The Company does not have any Liabilities, other than (i) Liabilities reflected or accrued for on the face of the Latest Balance
Sheet and (ii) Liabilities similar in nature and amount to those reflected or accrued for on the face of the Latest Balance Sheet
that have been incurred in the Ordinary Course.


 


(b)
As of the Closing, (i) the Company does not have any Indebtedness, (ii) the Company does not guarantee any Indebtedness of any
Person, (iii) there are no Liens on the Shares (other than restrictions on transfers imposed under applicable securities laws),
and (iv) there are no Liens (other than Permitted Liens) on, or outstanding payments owed with respect to, the assets and properties
of the Company.


 







    	-9-



     


    

 


Section
5.6 Absence of Certain Changes. Since the Most Recent Fiscal Year End, the Company has conducted its business and operations
in the Ordinary Course and there has not been any event, occurrence, fact, development, condition, or change that has had, or
could reasonably be expected to have, individually or in the aggregate, a material adverse effect on the Company and/or Business.
Without limiting the generality of the foregoing, since the Most Recent Fiscal Year End, other than as set forth on Schedule
5.6, the Company has not:


 


(a)
sold, leased, transferred, or assigned any of its assets, tangible or intangible, other than in the Ordinary Course;


 


(b)
accelerated, terminated, modified, or canceled any Contract (or series of related Contracts);


 


(c)
canceled, compromised, waived, or released any debt, right, or claim (or series of related rights and claims);


 


(d)
experienced any damage, destruction, or loss to its property in excess of $20,000 in the aggregate (whether or not covered by
insurance);


 


(e)
created or suffered to exist any Lien (other than Permitted Liens) upon any of its assets, tangible or intangible;


 


(f)
entered into, amended, or modified in any respect (beyond any amendments and modifications reflected in true and complete copies
of such Employee Benefit Plans delivered to Buyer) any Employee Benefit Plan, or announced or otherwise committed to any such
entry, amendment, or modification;


 


(g)
entered into any employment agreement or collective bargaining agreement, made any general wage or salary increase or granted
any increase in excess of $10,000 in the salary of any employee of the Company or paid or committed to pay any bonus to any officer
or employee, or announced or otherwise committed to any such entry, increase, or payment;


 


(h)
changed the manner in which the Business has been conducted, including collection of accounts receivable, purchases of raw materials,
and other inventory, payment of accounts payable and changes in the payment terms of any Top Customer or Top Supplier;


 


(i)
changed the accounting principles, methods, or practices or any change in the depreciation or amortization policies or rates;


 


(j)
terminated, received written notice of termination of, materially reduced, or received written notice of a material reduction
in, the relationship with any Top Customer or Top Supplier;


 


(k)
incurred, assumed, or guaranteed any Indebtedness, except unsecured current obligations and Liabilities incurred in the Ordinary
Course;


 




    	-10-



     


    

 


(l)
(i) made, rescinded, revoked, or changed any election in respect of Taxes, (ii) adopted or changed any accounting method in respect
of Taxes, (iii) signed or entered into any closing agreement or settlement, (iv) settled any claim or assessment in respect of
Taxes, (v) acted or omitted to act where such action or omission to act could reasonably be expected to have the effect of increasing
any present or future Liability for any Tax or decreasing any present or future Tax benefit for the Company or Buyer or their
respective Affiliates, (vi) consented to any extension or waiver of the limitation period applicable to any claim or assessment
in respect of Taxes, or (vii) filed any amended Tax Returns or surrendered any right to claim a refund offset or other reduction
in liability;


 


(m)
acquired by merger or consolidation with, or by purchase of a material portion of the assets, capital stock or other Equity Securities
of, or by any other manner, any business or any Person or any division thereof;


 


(n)
amended or otherwise change the Organizational Documents of the Company;


 


(o)
made any loans, advances, or investments to or in any Person;


 


(p)
adopted a plan of complete or partial liquidation, dissolution, restructuring, recapitalization, or other reorganization;


 


(q)
delayed or postponed the payment of any accounts payable when due (other than amounts contested in good faith), or accelerated
the collection of or failed to use commercially reasonable efforts to collect any accounts receivable when due; or


 


(r)
committed (orally or in writing) to any of the foregoing.


 


Section
5.7 Material Contracts.


 


(a)
Except as set forth on Schedule 5.7(a), the Company is not a party to or otherwise bound by any of the following Contracts
(collectively, the “Material Contracts”):


 


(i)
any lease or sublease of real property or personal property;


 


(ii)
any Contract for capital expenditures or the purchase of goods, services, materials, supplies, or equipment providing for either
(A) annual payments by the Company in excess of $10,000 or (B) aggregate payments by the Company in excess of $20,000;


 


(iii)
any Contract relating to the sharing of commissions or fees, rebating, or any other similar arrangement;


 


(iv)
any Contract granting any Person “most favored nation” status or “exclusivity” or similar rights;


 


(v)
any Contract granting any Person a right of first refusal, right of first offer, or other preferential right to purchase or acquire
any of the Company’s Equity Securities, assets, properties, or business of the Company;


 




    	-11-



     


    

 


(vi)
any Contract for any partnership, joint venture, strategic alliance, or other similar arrangement;


 


(vii)
any Contract requiring the Company to make any advance, loan, extension of credit, or capital contribution to, or other investment
in, any Person;


 


(viii)
any Contract with any Governmental Authority;


 


(ix)
any Contract relating to the acquisition or divestiture of any business or assets (whether by merger, sale of Equity Securities,
sale of assets, or otherwise), including any Contract pursuant to which the Company is, or may become, obligated to pay any amount
in respect of an “earn-out” or other form of deferred or contingent consideration;


 


(x)
any Contract (A) relating to the incurrence, assumption, or guarantee of any Indebtedness (including all loan agreements, notes,
bonds, debentures, indentures, or guarantees) or (B) creating or granting a Lien (other than Permitted Liens) on any of the assets
or properties of the Company or any of the Shares;


 


(xi)
any agreement with any officer, manager, individual employee, consultant, independent contractor, or other Person that (A) describes
any terms or conditions of employment or engagement of such Person, including any employment agreement, retention agreement, severance
agreement, compensation agreement, change of control agreement, consulting agreement, and independent contractor agreement, (B)
imposes upon any officer, manager, individual employee, consultant, independent contractor, or other Person any obligation with
respect to the assignment of inventions or the nondisclosure or confidentiality of proprietary or confidential information or
trade secrets, or (C) restricts the activities of any officer, manager, individual employee, consultant, independent contractor,
or other Person during or after his or her employment or engagement by the Company, including any agreement that restricts any
such Person’s ability to compete with any Person, provide services to any Person, solicit any Person’s employees,
or solicit any Person’s actual or prospective customers, suppliers or vendors;


 


(xii)
any Contract between the Company, on the one hand, and any of its Affiliates, any of the Seller Parties or any of their respective
Affiliates, on the other hand;


 


(xiii)
any Contract regarding confidentiality or nondisclosure entered into outside the Ordinary Course;


 


(xiv)
any Contract relating to any Intellectual Property Rights, other than standard end-user license agreements for “off-the-shelf”
software that is generally commercially available for an annual fee of less than $10,000;


 


(xv)
any Contract that limits or purports to limit the ability of the Company (or would limit the ability of Buyer after the Closing)
(A) to engage in any line of business, (B) to compete with any Person, (C) to operate in any geographic area, (D) to solicit or
accept business from the clients or prospective clients of any Person, or (E) to solicit for employment or hire any Person;


 




    	-12-



     


    

 


(xvi)
any Contract providing for or relating to the settlement or compromise of any Action by or against the Company in excess of $10,000;


 


(xvii)
any Contract under which the work by the Company is not yet complete, or under which the Company otherwise has ongoing material
obligations;


 


(xviii)
any collective bargaining agreement, labor contract, or other agreement or understanding with any labor organization or labor
union;


 


(xix)
any Contract to which the Company is a party which is capable of being terminated by the other party upon the occurrence of any
of the Contemplated Transactions;


 


(xx)
any Contract which involves payment by any party of amounts determined by reference to fluctuations in any retail prices or other
index or in the rate of exchange for any currency;


 


(xxi)
any Contract with any Top Customer or Top Supplier;


 


(xxii)
any Contract requiring indemnification of another Person;


 


(xxiii)
any Contract whereby the Company is obligated to pay royalties or license fees to another Person;


 


(xxiv)
any Contract or group of related Contracts with the same party (or group of related parties) either (A) requiring payments after
the date hereof to or by the Company of more than $20,000 or (B) not terminable by the Company on thirty (30) days’ or less
notice and without the payment of any penalty by, or any other material consequence to, the Company; and


 


(xxv)
any other Contract of a type that is not covered by the other clauses of this Section 5.7(a) that (A) is material to the
operation of the Business or the absence of which would have a material adverse effect on the Company and/or Business or (B) is
not terminable on not more than thirty (30) days’ notice and without the payment of any penalty by, or any other material
consequence to, the Company.


 


(b)
The Company has made available to Buyer a true, complete, and correct copy of each Material Contract, including all amendments
thereto.


 


(c)
Each Material Contract (i) is a legal, valid, and binding obligation of the Company and, to the knowledge of the Company, the
other parties thereto, (ii) is in full force and effect in accordance with its terms and (iii) will continue in full force and
effect without penalty or other adverse consequence upon consummation of the Contemplated Transactions, subject to obtaining the
consents and approvals, giving the notices, or taking the other actions referred to on Schedule 5.2(b). Neither the Company
nor, to the knowledge of the Company, any other party to a Material Contract is in material breach of or material default under,
or has provided or received any notice alleging any material breach of or material default under, any Material Contract. No event
has occurred that (with or without notice, lapse of time, or both) would constitute a material breach of or material default under
any Material Contract by the Company or, to the knowledge of the Company, by any other party thereto. None of the counterparties
to any Material Contract has notified the Company or any of the Seller Parties that it intends to terminate, cancel, or not renew
such Material Contract.


 




    	-13-



     


    

 


Section
5.8 Legal Proceedings. Since January 1, 2017, there have been no Actions involving the Company, any of the Company’s
Equity Securities, or the Business and no such Actions are currently pending or have been threatened. The Company is not subject
to or otherwise bound by any order, injunction, judgment, settlement, or decree that prohibits or limits the conduct of the Business
or the ownership or use of any of the assets or properties of the Company nor is there any claim or other Action pending or threatened
with respect thereto.


 


Section
5.9 Compliance with Laws. The Company and the conduct of the Business are in compliance with all, and have not in the past
five (5) years violated any, applicable Law. Neither the Company nor any Seller Party has received any notice or other communication
from any Governmental Authority or other Person alleging or asserting any such violation. The Company is not subject (and has
not, within the five (5)-year period ending on the Closing Date, been subject) to any adverse inspection, finding of deficiency,
finding of non-compliance, compelled recall, investigation, penalty, fine, sanction, assessment, audit, request for corrective
or remedial action, or other compliance or enforcement action by any Governmental Authority, in each case, relating to the assets,
products or services provided by the Company or conduct of the Business.


 


Section
5.10 Company Licenses. The Company holds or possesses, and is in compliance with, and has timely sought the renewal of,
all Licenses required for the lawful conduct of the Business as currently conducted (the “Company Licenses”).
Schedule 5.10 sets forth a true, complete, and correct list of all such Company Licenses, including with respect to each
the type of license, the license number, the jurisdiction issuing such license, and the expiration date of such license. Except
as set forth on Schedule 5.10: (a) each Company License is valid and in full force and effect; (b) neither the Company
nor any Seller Party has received any notice or other communication alleging, or is in, any breach of or default under any Company
License; and (c) the consummation of the Contemplated Transactions will not result in the termination or impairment of any of
the Company Licenses. 


 


Section
5.11 Title to and Sufficiency of Assets; Condition of Assets.


 


(a)
The Company has good, valid, and marketable title to, or in the case of leased assets and properties a valid leasehold interest
in, to all of the personal property and assets reflected on the Latest Balance Sheet or acquired by it after the Latest Balance
Sheet Date, except for (i) assets which have been sold since the Latest Balance Sheet Date in the Ordinary Course for fair consideration
and (ii) Permitted Liens. There is no Contract granting any Person or recognizing with respect to any Person any ownership or
vesting right in, or any right of first refusal, right of first offer, or other preferential right to purchase, any of the assets
or properties of the Company or any portion thereof or interest therein. Except as set forth on Schedule 5.11(a), none
of the Seller Parties or any employees, officers, managers, directors, or independent contractors of the Company, nor any of their
respective Affiliates owns any rights in any assets, tangible or intangible, which are used in the operation of the Business.


 




    	-14-



     


    



 





(b)
The personal property and assets shown on the Latest Balance Sheet or acquired after the Latest Balance Sheet Date, the lease
rights under the leases of personal property, and the Intellectual Property owned or used by the Company under valid license,
constitute all the assets and services used by the Company in operating the Business as it is currently operated by the Company,
and all such assets are located at a Leased Real Property location. Such assets will enable Buyer to operate the Business after
the Closing in the same manner as operated by the Company immediately prior to the Closing.


 


(c)
All of the Company’s equipment and other tangible personal property and assets are in good condition and repair, except
for ordinary wear and tear not caused by neglect, and are useable in the Ordinary Course and have been properly maintained and
serviced. There is no machinery or equipment which is reasonably expected to require replacement in the twelve (12)-month period
following the Closing Date. Schedule 5.11(c) sets forth a list of all real and tangible personal property owned or leased
by the Company and/or used in the Business as well as any other assets owned or leased by the Company and/or used in the Business
along with the date acquired and amount of payments left on any lease (as applicable).


 


Section
5.12 Real Property.


 


(a)
The Company does not, nor has it ever, owned any parcel of real property.


 


(b)
The Company is a party to only that certain real estate lease with respect to the leasing of the premises located at 42 Throckmorton
Lane, Old Bridge, New Jersey 08857 (the “Leased Real Property”).


 


Section
5.13 Intellectual Property.


 


(a)
The Company owns all right, title, and interest in and to, or is licensed or otherwise possesses legally enforceable rights to
use, all Intellectual Property Rights used in or necessary for the conduct of the Business (collectively, the “Business
Intellectual Property”) in each case free and clear of all Liens other than Permitted Liens. The consummation of the
Contemplated Transactions will not result in the termination or impairment of the Business Intellectual Property.


 


(b)
The conduct of the Business and the use of the Business Intellectual Property do not infringe, misappropriate, or otherwise violate
any Intellectual Property Rights of any third party.


 


Section
5.14 Tax Matters. Except as set forth on Schedule 5.14:


 


(a)
The Company has timely filed (after giving effect to any extensions obtained) all Tax Returns required to be filed by or with
respect to it. All such Tax Returns are true, correct, and complete in all material respects, and all Taxes owed by or with respect
to the Company (whether or not shown on any such Tax Returns) have been paid. The Company is not currently the beneficiary of
any extension of time within which to file any Tax Return.


 




    	-15-



     


    

 





(b)
The Company has established reserves that are adequate for the payments of all Taxes not yet due and payable. Since the Most Recent
Fiscal Year End, the Company has not incurred any Liability for Taxes other than in the Ordinary Course.


 


(c)
No claim has ever been made by any Taxing Authority in a jurisdiction where the Company does not file Tax Returns that it is or
may be subject to taxation in that jurisdiction.


 


(d)
The Seller Parties have delivered to Buyer or made available, true, correct, and complete copies of all income and other material
Tax Returns, ruling requests, private letter rulings, closing agreements, settlement agreements, and statements of deficiencies
sent or received by the Company with respect to taxable periods ending on or after December 31, 2017.


 


(e)
All estimated Taxes required to be paid by or with respect to the Company have been paid to the proper Governmental Authority.


 


(f)
The Company has timely withheld and paid over to the appropriate Taxing Authority all Taxes which it is required to withhold from
amounts paid or owing to any employee, shareholders, creditor, holder of securities, or other third party, and has complied with
all information reporting (including IRS Form 1099) and backup withholding requirements, including maintenance of required records
with respect thereto.


 


(g)
There are no Liens relating or attributable to Taxes encumbering (and no Taxing Authority has threatened to encumber) the assets
of the Company, except for Permitted Liens. There are no Liens relating or attributable to Taxes encumbering (and no Taxing Authority
has threatened to encumber) the Shares.


 


(h)
No claim or proceeding is pending or, to the knowledge of the Company, threatened against or with respect to the Company in respect
of any Tax. There are no unsatisfied Liabilities for Taxes with respect to any written notice of deficiency or similar document
received by the Company with respect to any Tax other than Liabilities for Taxes asserted under any such notice of deficiency
or similar document which are being contested in good faith by the Company and with respect to which adequate reserves for payment
have been established (and for which a reasonably detailed description of each such Liability has been provided on Schedule
5.14).


 


(i)
The Company has not waived any statute of limitations for the period of assessment or collection of Taxes, or agreed to or requested
any extension of time for the period with respect to a Tax assessment or deficiency, which period (after giving effect to such
extension or waiver) has not yet expired.


 


(j)
The Company will not be required to include any item of income in, or exclude any item of deduction from, taxable income for any
period ending after the Closing Date as a result of any: (i) change in method of accounting for any period beginning on or prior
to the Closing Date pursuant to 481 of the Code (or any similar provision of state, local, or foreign Law); (ii) use of an improper
method of accounting for a taxable period ending on or prior to the Closing Date; (iii) “closing agreement” as described
in 7121 of the Code (or any similar provision of state, local, or foreign Law) executed on or prior to the Closing Date; (iv)
intercompany transactions or excess loss accounts described in Treasury Regulation 1.1502-13, or 1.1502-19; (v) installment sale
or open transaction disposition made on or prior to the Closing Date; (vi) prepaid income received or accrued on or prior to the
Closing Date; or (vii) method of accounting that defers the recognition of income to any period ending after the Closing Date,
or modification or forgiveness of any Indebtedness made on or prior to the Closing Date.


 




    	-16-



     


    




 


(k)
The Company (i) is not a party to, is not bound by, and has no obligation under, any Tax Sharing Agreement, and (ii) has no potential
liability or obligation (for Taxes or otherwise) to any Person as a result of, or pursuant to, any such Tax Sharing Agreement.


 


(l)
The Company (i) is not a party to, is not bound by, and has no obligation under, any closing or similar agreement, Tax abatement
or similar agreement, or any other agreements with any Taxing Authority with respect to any period for which the statute of limitations
has not expired and (ii) has no potential liability or obligation (for Taxes or otherwise) to any Person as a result of, or pursuant
to, any such agreement.


 


(m)
The Company has no liability for the Taxes of any Person under Treasury Regulation 1.1502-6 (or any similar provision of state,
local or foreign Law), as a transferee, successor or as a result of similar liability, operation of Law, by contract (including
any Tax Sharing Agreement), or otherwise. The Company has not been included in any “consolidated”, “unitary”,
“combined”, or similar Tax Return provided for under the United States or any non-U.S. jurisdiction or any state.


 


(n)
The Company has not (i) taken a reporting position on a Tax Return that, if not sustained, could be reasonably likely to give
rise to a penalty for substantial understatement of federal income Tax under 6662 of the Code (or any similar provision of state,
local, or foreign law), (ii) entered into any transaction identified as a (A) “listed transaction,” within the meaning
of Treasury Regulations Sections 1.6011-4(b)(2), (B) a “transaction of interest,” within the meaning of Treasury Regulations
1.6011-4(b)(6), or (C) any transaction that is “substantially similar” (within the meaning of Treasury Regulations
1.6011-4(c)(4)) to a “listed transaction” or “transaction of interest,” or (iii) entered into any other
transaction that required or will require the filing of an IRS Form 8886.


 


(o)
The Company has not received any letter ruling from the IRS (or any comparable ruling from any other Taxing Authority).


 


(p)
The Company has not distributed stock of another Person, or had its stock distributed by another Person in a transaction intended
or purported to be governed, in whole or in part, by 355 of the Code or 361 of the Code.


 


(q)
The Company is and has been validly electing S corporation within the meaning of Section 1361 and 1362 of the Code for purposes
of applicable federal and state income Tax Laws since its inception. The Company will not be liable for any Tax under Section
1374 of the Code in connection with the transactions contemplated herein. The Company has not in the past five (5) years (i) acquired
assets from another corporation in a transaction in which the Company’s Tax basis for the acquired assets was determined,
in whole or in part, by reference to the Tax basis of the acquired assets (or any other property) in the hands of the transferor
or (ii) acquired the stock of any corporation that is a qualified subchapter S subsidiary.


 




    	-17-



     


    

 





(r)
The Company is not a party to any Contract, arrangement, or plan that has resulted or could result, separately or in the aggregate,
in the payment of (i) any “excess parachute payment” within the meaning of 280G of the Code (or any corresponding
provision of state, local, or non-U.S. tax law) or (ii) any amount that will not be fully deductible as a result of 162(m) of
the Code (or any corresponding provision of state, local, or non-U.S. tax law).


 


Section
5.15 Environmental Matters. The Company currently conducts, and has conducted, the Business in compliance in with all applicable
Environmental Laws. There are no permits under applicable Environmental Laws required for the Business. There are no underground
storage tanks operated or formerly operated by the Company at any of the Leased Real Property locations, and no underground storage
tanks are otherwise present at the Leased Real Property location for which the Company has any responsibility or Liability under
applicable Environmental Laws. Neither the Company nor any of the Seller Parties has received any notice or other communication
from any Person alleging that the Company is not in compliance with or has any Liability under any applicable Environmental Law
or demanding payment, contribution, indemnification, remedial action, removal action, financial assurance or any other action
or inaction with respect to any actual or alleged environmental damage, condition or event or injury to persons, property or natural
resources. The Company has not generated, manufactured, sold, handled, treated, recycled, stored, transported, disposed of, arranged
for the disposal of, released, or placed any Hazardous Material in a manner which could reasonably be expected to give rise to
material liabilities to the Company under Environmental Laws. There is no Remedial Action pending or, to the knowledge of the
Company, threatened against the Company. There has not been any Release or threatened Release of any Hazardous Materials by the
Company on, upon, under, into, or from any of the Leased Real Property locations or any property currently owned, leased, or occupied
or previously owned, leased, or occupied by the Company, and, to the knowledge of the Company, there are no Hazardous Materials
on, upon, under, into, or from any of the Leased Real Property locations or any property currently owned, leased, or occupied
or previously owned, leased, or occupied by the Company which require Remedial Action. There has been no Release of Hazardous
Materials for which the Company could have any Liability under any applicable Environmental Laws at any real property formerly
owned, operated, or leased by the Company. The Company has not agreed to assume any actual or potential Liability under any Environmental
Laws of any other Person. The Company has provided Buyer with access to true and correct copies of all material reports, investigations,
audits, and inspections in possession, custody or control of the Company pertaining or relating to Hazardous Material in connection
with any real property now or previously owned, leased or occupied by the Company. The Company has not received any written notice
that any property now or previously owned, operated or leased by the Company is listed or is proposed for listing on the National
Priorities List pursuant to CERCLA, the Comprehensive Environmental Response, Compensation and Liability Information System List,
any registry of contaminated land sites or on any similar state or foreign list of sites requiring investigation or cleanup, and
no Lien (other than Permitted Liens) has been filed against either the personal or real property of the Company under Environmental
Law. The Company is not aware of any current or proposed requirements under Environmental Law which would require material capital
expenditures in the next twelve (12) months which are not shown on the Latest Balance Sheet.


 




    	-18-



     


    

 





Section
5.16 Business Personnel.


 


(a)
Schedule 5.16(a) sets forth a true, complete, and correct list of the following information with respect to each current
Business Personnel: (i) name; (ii) title or position held; (iii) date of hire; (iv) total length of employment or service, including
any prior service credit that would affect the calculation of years of service for any purpose; (v) classification as exempt or
non-exempt; (vi) status as full- or part-time; (vii) work location; (viii) current annual compensation (including base salary,
commissions, and deferred compensation); (ix) accrued bonus, if any, as of the date hereof; and (x) accrued but unused vacation
and other paid-time-off entitlements as of the date hereof. Each of the Business Personnel is employed by the Company.


 


(b)
Each Business Personnel is an “at-will” employee or an independent contractor whose employment or engagement, respectively,
may be terminated at any time without advance notice by or liability to the Company. Each Business Personnel is, and at all times
in the past five (5) years has been, properly classified as an employee or non-employee and as “exempt” or “non-exempt”
for all purposes (including with respect to eligibility for minimum wage and overtime under the Fair Labor Standards Act and for
purposes of taxation and tax reporting and under the Employee Benefit Plans). All employees classified as non-exempt under the
Fair Labor Standards Act and any applicable state and local wage and hour Laws at all times in the past five (5) years have been
fully and properly paid all overtime due under such Laws. Except as set forth on Schedule 5.16(b), (i) none of the Business
Personnel is on a paid or unpaid medical, disability, family, or other leave of absence; and (ii) none of the Business Personnel
has given notice of termination of his or her employment or engagement, or has indicated to the Company an intention to terminate
his or her employment or engagement within the nine (9) -month period prior to the Closing Date.


 


(c)
All salaries, wages, commissions, bonuses, vacation pay, withholdings, remittances, and other Liabilities related to the employment
or engagement of the Business Personnel that are accrued or due to be paid on or before the Closing Date will be fully paid as
of the Effective Time.


 


(d)
The Company has not, within the past five (5) years, received any “cease and desist” letter or similar communication
alleging that any Business Personnel is, and to the knowledge of the Company no Business Personnel is, performing any job duties
or engaging in other activities on behalf of the Company that would violate any employment, non-competition, non-solicitation,
non-disclosure, or other similar agreement between such individual and any former employer or any Law.


 


Section
5.17 Labor Matters.


 


(a)
The Company is, and for the past five (5) years has been, in compliance in all respects with all Laws relating to employment and
employment practices, including any Employee Benefit Plans, the terms and conditions of employment, termination of employment,
hiring practices and procedures, immigration and employment verification matters, workplace health and safety, workers’
compensation, human rights, discrimination, retaliation, and harassment, applicable leave Laws, wages and hours (including minimum
wage and overtime payments), and worker classification. No current executive of the Company has been the subject of any complaint
of sexual harassment, sexual assault, or sexual discrimination during his or her tenure at the Company.


 




    	-19-



     


    







 


(b)
The Company has never been nor is currently a party to or otherwise bound by any collective bargaining agreement or other agreement
with a labor union or equivalent organization, and there is no organizational campaign or other effort to cause a labor union
or equivalent organization to be recognized or certified as a representative on behalf of the Business Personnel in dealing with
the Company. There is no pending or, to the knowledge of the Company, threatened labor strike, labor dispute, or work stoppage
involving the Business Personnel.


 


(c)
The Company has fully complied with all applicable Laws, including but not limited to all applicable federal, state, and local
statutes, regulations, and orders related to employee leave, workplace safety, and employee accommodations, related to, or in
response to, COVID-19. Additionally, the Company has complied with all social distancing guidelines and other recommendations
applicable to employers promulgated by all applicable healthcare and regulatory authorities, including but not limited to the
Centers for Disease Control and Prevention, related to COVID-19.


 


Section
5.18 Employee Benefit Matters.


 


(a)
Schedule 5.18(a) sets forth a true, complete, and correct list of all Employee Benefit Plans. With respect to each Employee
Benefit Plan, the Company has made available to Buyer true, complete, and correct copies of all documents, reports, statements
and correspondence related thereto.


 


(b)
Each Employee Benefit Plan has been established, maintained, administered, and funded in compliance with, and complies with, its
terms and all applicable Laws (including ERISA and the Code) in all respects, and there has not been any notice issued by any
Governmental Authority questioning or challenging such compliance. The Company has timely paid or made all contributions, distributions,
reimbursements, and premium payments required under or with respect to each Employee Benefit Plan, including accruing in the Ordinary
Course of the Company for any incurred but not reported liabilities for all periods ending on or before the Closing Date.


 


Section
5.19 Insurance Matters. Schedule 5.19 accurately and completely sets forth all material information relating to
each insurance policy (including policies providing property, casualty, liability, and workers’ compensation coverage and
bond and surety arrangements) to which the Company is a party, a named insured, or otherwise the beneficiary of coverage. With
respect to each such insurance policy: (i) the policy is legal, valid, binding, enforceable, and in full force and effect; (ii)
the policy will continue to be legal, valid, binding, enforceable, and in full force and effect on identical terms immediately
following the consummation of the Contemplated Transactions; (iii) neither the Company nor, to the knowledge of the Company, any
other party to the policy is in breach or default of, and no event has occurred which, with notice or the lapse of time, or both,
would constitute such a breach or default of or permit any termination or modification of or acceleration under, the policy; and
(iv) no party to the policy has repudiated any provision thereof.


 




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Section
5.20 Related Party Transactions; Potential Conflicts of Interest. Except for the agreements with Synergy Medical Laboratory
set forth on Schedule 5.20, the Company has no Contracts or other arrangements with any Affiliate of the Company or any
Related Party.


 


Section
5.21 Unlawful Payments. No payments of either cash or other consideration have been made to any Person by the Company or
any Seller Party or any Related Party or on behalf of the Company or any Seller Party by any Representative or equityholder of
the Company or any other Person, that were unlawful under any applicable Law.


 


Section
5.22 Bank Accounts; Powers of Attorney. Schedule 5.22 sets forth a true, complete, and correct list of the following
information with respect to the Company: (a) all bank accounts and safe deposit boxes of the Company and all persons authorized
to sign or otherwise act with respect thereto as of the date hereof; and (b) all persons holding a general or special power of
attorney granted by the Company and a true, complete, and correct copy thereof.


 


Section
5.23 No Broker. No broker, finder, investment banker, or other intermediary is entitled or has claimed to be entitled to
any fee or commission in connection with the Contemplated Transactions based upon arrangements made by or on behalf of the Company.


 


Section
5.24 Accounts Receivable. All accounts receivable of the Company are valid receivables, collectible (net of any reserve
set forth on the face of the Latest Balance Sheet), and represent arm’s length transactions in the Ordinary Course. The
Company has not pre-billed any customers and has not received notice of any, and to the knowledge of the Company, there is no,
contest, claim, or right of set-off, other than returns in the Ordinary Course, relating to the amount or validity of any such
account receivable. Each of the accounts receivable (subject to any reserve set forth on the face of the Latest Balance Sheet)
either has been or will be collected in full, without any setoff, within ninety (90) days after the day on which it first becomes
due and payable.


 


Section
5.25 Top Customers and Top Suppliers.


 


(a)
Schedule 5.25(a) sets forth a true, correct, and complete list of the top ten (10) customers of the Company (by revenue
received by the Company during each of the twelve (12)-month periods ending December 31, 2017, December 31, 2018 and December
31, 2019 and during the nine (9)-month period ending September 30, 2020) (the “Top Customers”), together with
the revenue received from the Top Customers during such periods. No Top Customer has canceled, terminated, or otherwise materially
reduced (on a year-over-year basis) its relationship with the Company, and no Top Customer has advised the Company of any intention
to do so. There are no pending or, to the knowledge of the Company, threatened disputes with or by any Top Customer.


 


(b)
Schedule 5.25(b) sets forth a true, correct, and complete list of the top ten (10) suppliers of the Company (by amounts
paid by the Company during each of the twelve (12)-month periods ending December 31, 2017, December 31, 2018 and December 31,
2019 and during the nine (9)-month period ending September 30, 2020) (the “Top Suppliers”), together with the
amounts paid to the Top Suppliers during such periods. No Top Supplier has canceled, terminated, or otherwise materially reduced
(on a year-over-year basis) its relationship with the Company, and no Top Supplier has advised the Company of any intention to
do so. There are no pending or, to the knowledge of the Company, threatened disputes with or by any Top Supplier.


 




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Section
5.26 Full Disclosure. No representation or warranty by the Company or by any Seller Party in this Agreement and no statement
contained in the Schedules to this Agreement or any certificate or other document furnished or to be furnished to Buyer pursuant
to this Agreement contains any untrue statement of a material fact, or omits to state a material fact necessary to make the statements
contained therein, in light of the circumstances in which they are made, not misleading.


 


ARTICLE
VI

REPRESENTATIONS AND WARRANTIES OF BUYER


 


As
a condition and material inducement to the Seller Parties’ willingness to enter into this Agreement and consummate the Contemplated
Transactions, Buyer represents and warrants to the Seller Parties as follows:


 


Section
6.1 Organization; Authorization; Enforceability.


 


(a)
Buyer is a corporation duly organized, validly existing, and in good standing under the laws of the State of Delaware. The execution,
delivery, and performance by Buyer of this Agreement and each Ancillary Agreement to which Buyer is a party and the consummation
by Buyer of the Contemplated Transactions are within Buyer’s corporate powers and have been duly and validly authorized
and approved by all necessary corporate action on the part of Buyer.


 


(b)
This Agreement and each Ancillary Agreement to which Buyer is a party have been duly and validly executed and delivered by Buyer,
and this Agreement (assuming due authorization, execution, and delivery by the Seller Parties and Company) and each such Ancillary
Agreement (assuming due authorization, execution, and delivery by the other parties thereto) constitute the legal, valid, and
binding obligation of Buyer, enforceable against Buyer in accordance with their respective terms, subject to the Enforceability
Exceptions.


 


Section
6.2 Noncontravention.


 


(a)
The execution, delivery, and performance by Buyer of this Agreement and each Ancillary Agreement to which Buyer is a party, and
the consummation by Buyer of the Contemplated Transactions, do not and will not: (i) contravene, conflict with, violate, or result
in a breach of any provision of Buyer’s Organizational Documents; (ii) contravene, conflict with, violate, or result in
a breach of any Law applicable to Buyer; or (iii) require any consent of, notice or payment to any Person under any material Contract
to which Buyer is a party, other than, in the case of the foregoing clauses, any such items that have not had and would not reasonably
be expected to have, individually or in the aggregate, a material adverse effect on Buyer’s ability to perform its obligations
hereunder or to timely consummate the Contemplated Transactions.


 




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(b)
No consent, approval or authorization of, or registration, declaration, or filing with, or notice to, any Governmental Authority
or any other Person is required to be obtained, made or given by Buyer as a result of or in connection with its execution, delivery,
and performance of this Agreement or its consummation of the Contemplated Transactions, other than any items the failure of which
to obtain, make or give would not reasonably be expected to have, individually or in the aggregate, a material adverse effect
on Buyer’s ability to perform its obligations hereunder or to timely consummate the Contemplated Transactions.


 


Section
6.3 Legal Proceedings. There is no Action pending or, to the knowledge of Buyer, threatened against or affecting Buyer
that, if determined or resolved adversely to Buyer, would have a material adverse effect on Buyer’s ability to perform its
obligations hereunder or to timely consummate the Contemplated Transactions.


 


Section
6.4 No Broker. No broker, finder, investment banker, or other intermediary is entitled or has claimed to be entitled to
any fee or commission in connection with the Contemplated Transactions based upon arrangements made by or on behalf of Buyer.


 


ARTICLE
VII

COVENANTS


 


Section
7.1 Public Announcements. The Seller Parties shall not make, or permit any Representative or Affiliate of theirs to make,
any public statements or otherwise communicate with any news media, including the issuance of any press releases, with respect
to this Agreement, the Ancillary Agreements or the Contemplated Transactions without the prior written consent of Buyer (which
consent shall not be unreasonably withheld or delayed), unless otherwise required by applicable Law, in which case the Seller
Parties shall allow Buyer reasonable time to comment on such release or announcement in advance of such issuance. Buyer and the
Seller Parties acknowledge and agree that, following the Closing, Buyer, in its sole discretion, may make a customary public announcement
regarding consummation of the transactions contemplated hereby.


 


Section
7.2 Restrictive Covenants. As a condition and material inducement to Buyer’s willingness to enter into this Agreement
and purchase the Shares hereunder, and to protect the value and goodwill of the Business and the substantial investment made by
Buyer, each of the Seller Parties hereby covenants and agrees as follows:


 


(a)
Non-Solicitation and Non-Hire. Except with respect to soliciting business from customers and vendors of Synergy Medical
Laboratory as of the date hereof, for a period of twenty-four (24) months immediately following the Closing Date, no Seller Party
will, and each Seller Party will cause its Affiliates not to, directly or indirectly:


 


(i)
solicit the business of any Person who is a customer of the Company, Buyer, or any of their respective Affiliates with respect
to the Business;


 


(ii)
cause or induce, or attempt to cause or induce, any customer, supplier, vendor, licensee, licensor, franchisee, employee, contractor,
consultant, or other business relation of Buyer or any of its Affiliates to cease doing business with such Person or to deal with
any competitor of Buyer or any of its Affiliates, or in any way interfere with Buyer’s or any of its Affiliates’ relationship
with any such Person;


 




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(iii)
cause or induce, or attempt to cause or induce, any customer, supplier, vendor, licensee, licensor, franchisee, employee, contractor,
consultant, or other business relation of the Company as of, or at any time during the twelve (12)-month period immediately preceding,
the Closing Date, to cease doing business with the Company, Buyer, or any of their respective Affiliates or to deal with any competitor
of the Company, Buyer, or any of their respective Affiliates, or in any way interfere with the Company’s, Buyer’s,
or any of their respective Affiliates’ relationship with any such Person; or


 


(iv)
solicit, induce, hire, retain, or attempt to hire or retain any employee or independent contractor of the Company, Buyer, or any
of their respective Affiliates (including any former employee or independent contractor if such Person was an employee or independent
contractor of the Company, Buyer, or any of its Affiliates within the twelve (12)-month period prior to such solicitation, inducement,
hiring, retention, or attempt to hire or retain), or in any way interfere with the relationship between the Company, Buyer, or
any of their respective Affiliates and any of such Person’s employees or independent contractors.


 


(b)
Confidentiality. From and after the Closing Date, each of the Seller Parties shall, and shall cause its Affiliates and,
as applicable, their respective Representatives to, keep confidential and not disclose or use any Confidential Information, other
than to disclose Confidential Information to Buyer. Notwithstanding the foregoing, if such Seller Party or any of its Affiliates
or, as applicable, any of their respective Representatives (collectively, the “Disclosing Party”) is requested
or required by Law to disclose any Confidential Information, the Disclosing Party will provide Buyer with notice of such request
or requirement as promptly as practicable (unless prohibited by Law) so that Buyer may seek a protective order or other appropriate
remedy and/or waive compliance with the foregoing provisions of this Section 7.2(b). The Disclosing Party will cooperate
reasonably with Buyer in connection with Buyer’s efforts to seek such an order or remedy. If Buyer does not obtain such
an order or other remedy, or waives compliance with the provisions of this Section 7.2(b), the Disclosing Party will furnish
only that portion of the applicable Confidential Information that is legally required, and will exercise reasonable efforts to
obtain assurance that confidential treatment will be accorded such disclosed information.


 


(c)
Equitable Remedies. Each Seller Party acknowledges and agrees that (i) Buyer and its Affiliates would suffer irreparable
and ongoing damages (including a significant loss of the value and goodwill of the Shares and of the Business purchased by Buyer
pursuant to this Agreement) in the event that any provision of this Section 7.2 were not performed in accordance with its
terms or otherwise were breached; and (ii) monetary damages, even if available, alone would not be an adequate remedy for any
such non-performance or breach. Accordingly, each Seller Party agrees that in the event of any breach or threatened breach of
any provision of this Section 7.2, Buyer shall be entitled, in addition to all other rights and remedies that it may have
existing in its favor at law, in equity, or otherwise, to obtain injunctive or other equitable relief (including a temporary restraining
order, a preliminary injunction, and a final injunction) to prevent any such breach or threatened breach and to enforce such provisions
specifically, without the necessity of posting a bond or other security or of proving actual damages. The prevailing party in
any action commenced under this Section 7.2(c) (whether through a monetary judgment, injunctive relief, or otherwise) also
shall be entitled to recover reasonable attorneys’ fees and court costs incurred in connection with such action.


 




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(d)
General Acknowledgements. Each Seller Party acknowledges and agrees that (i) the covenants applicable to such Seller Party
set forth in this Section 7.2 constitute a material inducement to Buyer’s willingness to enter into this Agreement
and consummate the Contemplated Transactions and are an integral part of the Contemplated Transactions; (ii) but for these covenants,
Buyer would not have entered into this Agreement or agreed to acquire the Shares; (iii) in view of the highly competitive nature
of the Business, the business objectives of Buyer in acquiring the Shares, and the consideration paid for the Shares, each of
the covenants set forth in this Section 7.2 is reasonable with respect to its scope, geographic area, and duration and
is necessary to protect Buyer’s legitimate business interests (including the value and goodwill of the Business and the
Shares purchased by Buyer pursuant to this Agreement), and (iv) the Business, and the business engaged in by Buyer and its Affiliates,
both have a nationwide geographic scope.


 


Section
7.3 Further Assurances. At any time and from time to time following the Closing, at the request of any party hereto and
without further consideration, each party hereto shall execute and deliver, or cause to be executed and delivered, such further
documents and instruments and shall take, or cause to be taken, such further actions as any other party hereto may reasonably
request or as otherwise may be necessary or desirable to evidence and make effective the Contemplated Transactions.


 


Section
7.4 Release of Claims.


 


(a)
Release. For good and valuable consideration, effective upon the Closing, each of the Seller Parties, on behalf of itself,
himself, or herself and its, his, or her heirs, executors, administrators, legal representatives, successors, and assigns (collectively,
the “Releasors”), hereby unconditionally and irrevocably waives, releases, and forever discharges Buyer, the
Company, their respective Affiliates and subsidiaries, each of their respective predecessors, successors, and assigns, and each
of their respective current and former equityholders, partners, members, directors, managers, officers, employees, agents and
other Representatives (collectively, the “Releasees”) of and from any and all claims, demands, charges, complaints,
obligations, causes of action, suits, liabilities, indebtedness, sums of money, covenants, agreements, instruments, contracts
(written or oral, express or implied), controversies, promises, fees, expenses (including attorneys’ fees, costs, and expenses),
damages, and judgments, at law or in equity, in contract or tort, in United States, state, foreign, or other judicial, administrative,
arbitration, or other proceedings, of any nature whatsoever, known or unknown, suspected or unsuspected, previously, now or hereafter
arising (collectively, the “Claims”), that the Releasors ever had, now have, or hereafter shall or may have
for or by reason of, or in any way arising out of or relating to, any cause, matter, act, omission, or thing whatsoever from the
beginning of time through and including the Closing Date, including any Claims arising out of or relating to any Seller Party’s
ownership of any Shares or service as a director, officer, employee, agent, or other Representative of the Company. Except as
expressly set forth in Section 7.4(b), each of the Seller Parties acknowledges and understands that the foregoing is a
full and final release of all Claims that could have been asserted in any legal or equitable proceeding against the Releasees,
including any right to recover against the Releasees for any indemnification or contribution claims made against or paid by the
Seller Parties pursuant to ARTICLE VIII. To the maximum extent permitted by Law, each of the Seller Parties expressly waives
all rights afforded by any statute that limits the effect of a release with respect to unknown claims in connection with the release
expressly granted by this Section 7.4(a).


 




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(b)
Exceptions. Nothing in Section 7.4(a) shall constitute a release of any rights or obligations arising under this
Agreement or any of the Ancillary Agreements.


 


(c)
No Commencement of Released Claims. Each Releasor further covenants and agrees, effective upon the Closing Date and to
the fullest extent permitted by Law, not to commence, join, assist, or aid in any manner whatsoever the making of any claim or
the bringing of any Action against the Releasees based upon any of the Claims that are released pursuant to Section 7.4(a).


 


(d)
No Assignment. Each of the Seller Parties, on behalf of itself, himself, or herself and any Person claiming through such
Seller Party, (i) represents and warrants that neither such Seller Party nor any of such Persons has assigned and (ii) covenants
that neither such Seller Party nor any of such Persons will assign, to any other Person any Claim or potential Claim released
by Section 7.4(a).


 


Section
7.5 Tax Matters.


 


(a)
Computation of Liabilities. Whenever it is necessary to determine the Liability for Taxes for a Straddle Period relating
to:


 


(i)
Taxes of the Company imposed on a periodic basis (such as real property Taxes or other ad valorem Taxes), the determination of
the Taxes of the Company for the portion of the Straddle Period ending on and including and the portion of the Straddle Period
beginning and ending after, the Closing Date shall be calculated by allocating to the periods before and after the Closing Date
pro rata, based on the number of days of the Straddle Period in the period before and ending on the Closing Date, on the one hand,
and the number of days in the Straddle Period in the period after the Closing Date, on the other hand; and


 


(ii)
Taxes of the Company not described in Section 7.5(a)(i) (such as (A) Taxes based on the income or receipts of the Company
for a Straddle Period, (B) Taxes imposed in connection with any sale or other transfer or assignment of property (including all
sales and use Taxes) for a Straddle Period, and (C) withholding and employment Taxes relating to a Straddle Period), the determination
of the Taxes of the Company for the portion of the Straddle Period ending on and including, and the portion of the Straddle Period
beginning and ending after, the Closing Date shall be calculated by assuming that the Straddle Period consisted of two (2) taxable
periods, one (1) which ended at the close of the Closing Date and the other which began at the beginning of the day following
the Closing Date and items of income, gain, deduction, loss, or credit of the Company for the Straddle Period shall be allocated
between such two (2) taxable years or periods on a “closing of the books basis” by assuming that the books of the
Company were closed at the close of the Closing Date (and for such purpose, the taxable period of any partnership or other pass-through
entity in which the Company holds a beneficial interest shall be deemed to terminate at such time).


 




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(b)
Preparation and Filing of Tax Returns.


 


(i)
The Seller Party Representative shall, at the Seller Parties’ cost and expense, (A) prepare, or cause to be prepared all
Pre-Closing Period Tax Returns required to be filed by or on behalf of the Company. All such Pre-Closing Period Tax Returns shall
be prepared and filed in a manner that is consistent with the prior practice of the Company, except as required by applicable
Law. The Seller Party Representative shall deliver or cause to be delivered drafts of all such Pre-Closing Period Tax Returns
to Buyer for its review at least thirty (30) days prior to the due date of any such Pre-Closing Period Tax Return; provided,
however, that such drafts of any such Pre-Closing Period Tax Return shall be subject to Buyer’s review and approval,
which shall not be unreasonably withheld, conditioned, or delayed; and (B) pay all Pre-Closing Taxes due and payable in respect
of all Pre-Closing Period Tax Returns of the Company; provided, however, that if any Pre-Closing Period Tax Return is due after
the Closing and is to be filed (or caused to be filed) by Buyer, the Seller Parties shall pay (in immediately available funds)
to Buyer the amount of all Pre-Closing Taxes due and payable with respect of such Pre-Closing Period Tax Return (determined pursuant
to this Section 7.5) no later than three (3) Business Days prior to the earlier of the date such Pre-Closing Period Tax
Return is filed or the due date of such Pre-Closing Period Tax Return.


 


(ii)
Buyer shall, at its expense, prepare and timely file, or cause to be prepared and timely filed, all Straddle Period Tax Returns
required to be filed by the Company. All Straddle Period Tax Returns shall be prepared and filed in a manner that is consistent
with the prior practice of the Company, except as required by applicable Law. Buyer shall deliver or cause to be delivered drafts
of all Straddle Period Tax Returns to the Seller Party Representative for its review at least thirty (30) days prior to the due
date of any such Straddle Period Tax Return and shall notify the Seller Party Representative of Buyer’s calculation of the
Seller Parties’ share of the Taxes of the Company for such Straddle Period (determined in accordance with Section 7.5(a));
provided, however, that such drafts of any such Straddle Period Tax Returns and such calculations of the Seller
Parties’ share of the Tax liability for such Straddle Period (determined in accordance with Section 7.5(a)) shall
be subject to the Seller Party Representative’s review and approval, which approval shall not be unreasonably withheld,
conditioned, or delayed. The Seller Parties shall pay (in immediately available funds) to Buyer the amount of all Pre-Closing
Taxes due and payable with respect of any such Straddle Period Tax Return (determined pursuant to this Section 7.5) no
later than three (3) Business Days prior to the earlier of the date such Straddle Period Tax Return is filed or the due date of
such Straddle Period Tax Return.


 


(c)
Cooperation and Records Retention. The Seller Parties, the Seller Party Representative, and Buyer shall (i) each provide
the other, and Buyer shall cause the Company to provide the Seller Parties and the Seller Party Representative, with such assistance
as may be reasonably requested by any of them in connection with the preparation of any Tax Return, audit, or other examination
by any Taxing Authority or judicial or administrative proceedings relating to liability for Taxes, (ii) each retain and provide
the other, and Buyer shall cause the Company to retain and provide the Seller Parties and the Seller Party Representative with,
any records or other information that may be relevant to such Tax Return, audit or examination, proceeding, or determination,
and (iii) each provide the others with any final determination of any such audit or examination, proceeding, or determination
that affects any amount required to be shown on any Tax Return of the Company for any period. Without limiting the generality
of the foregoing, Buyer shall retain, and shall cause the Company to retain, and the Seller Parties and the Seller Party Representative
shall retain, until the applicable statutes of limitations (including any extensions) have expired, copies of all Tax Returns,
supporting work schedules and other records or information that may be relevant to such returns for all Tax periods or portions
thereof ending before or including the Closing Date and shall not destroy or otherwise dispose of any such records without first
providing the other parties hereto with a reasonable opportunity to review and copy the same. Each party hereto shall bear its
own expenses in complying with the foregoing provisions.


 




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(d)
Omitted.


 


(e)
Tax Proceedings.


 


(i)
Buyer shall deliver a written notice to the Seller Party Representative promptly following any demand, claim, or notice of commencement
of a claim, proposed adjustment, assessment, audit, examination, or other administrative or court Action with respect to Taxes
of the Company for which the Seller Parties may be liable (each, a “Tax Contest”) and shall describe in reasonable
detail (to the extent known by Buyer) the facts constituting the basis for such Tax Contest, the nature of the relief sought,
and the amount of the claimed Losses (including Taxes), if any (the “Tax Claim Notice”); provided, however,
that the failure or delay to so notify the Seller Party Representative shall not relieve the Seller Parties of any obligation
or Liability that the Seller Parties may have to Buyer, except to the extent that the Seller Parties demonstrate that the Seller
Parties are materially and adversely prejudiced thereby.


 


(ii)
With respect to Tax Contests for Taxes of the Company for a Pre-Closing Period, the Seller Party Representative may elect to assume
and control the defense of such Tax Contest by written notice to Buyer within thirty (30) days after delivery by Buyer to the
Seller Party Representative of the Tax Claim Notice. If the Seller Party Representative elects to assume and control the defense
of such Tax Contest, the Seller Party Representative (A) shall bear its own costs and expenses, (B) shall be entitled to engage
its own counsel, and (C) may (1) pursue or forego any and all administrative appeals, proceedings, hearings, and conferences with
any Taxing Authority, (2) either pay the Tax claimed or sue for refund where applicable Law permits such refund suit, or (3) contest,
settle, or compromise the Tax Contest in any permissible manner; provided, however, that Seller Party Representative
shall not settle or compromise (or take other actions described herein with respect to) any Tax Contest without the prior written
consent of Buyer (such consent not to be unreasonably withheld, delayed, or conditioned) if such settlement or compromise could
reasonably be expected to adversely affect the Tax Liability of Buyer or any of its Affiliates (including the Company) for any
Tax period ending after the Closing Date. If the Seller Party Representative elects to assume the defense of any Tax Contest,
the Seller Party Representative shall (x) keep Buyer reasonably informed of all material developments and events relating to such
Tax Contest (including promptly forwarding copies to Buyer of any related correspondence, and shall provide Buyer with an opportunity
to review and comment on any material correspondence before the Seller Party Representative sends such correspondence to any Taxing
Authority), (y) consult with Buyer in connection with the defense or prosecution of any such Tax Contest, and (z) provide such
cooperation and information as Buyer shall reasonably request, and Buyer shall have the right to participate in (but not control)
the defense of such Tax Contest (including participating in any discussions with the applicable Tax Authorities regarding such
Tax Contests).


 




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(iii)
In connection with any Tax Contest that relates to Taxes of the Company for a Pre-Closing Period that (A) the Seller Party Representative
does not timely elect to control pursuant to Section 7.5(e)(ii) or (B) the Seller Party Representative fails to diligently
defend, such Tax Contest shall be controlled by Buyer (and the Seller Parties, jointly and severally, shall reimburse Buyer for
all reasonable costs and expenses incurred by Buyer relating to a Tax Contest described in this Section 7.5(e)(iii)) and
the Seller Parties and the Seller Party Representative agree to cooperate with Buyer in pursuing such Tax Contest.


 


(iv)
In connection with any Tax Contest for Taxes of the Company for any Straddle Period, such Tax Contest shall be controlled by Buyer;
provided, that Buyer shall not settle or compromise (or take such other actions described herein with respect to) any Tax
Contest without the prior written consent of the Seller Party Representative, such consent not to be unreasonably withheld, conditioned,
or delayed. The Buyer shall (x) keep the Seller Party Representative informed of all material developments and events relating
to such Tax Contest (including promptly forwarding copies to the Seller Party Representative of any related correspondence and
shall provide the Seller Party Representative with an opportunity to review and comment on any material correspondence before
Buyer sends such correspondence to any Taxing Authority), (y) consult with the Seller Party Representative in connection with
the defense or prosecution of any such Tax Contest, and (z) provide such cooperation and information as the Seller Party Representative
shall reasonably request, and, at its own costs and expenses, the Seller Party Representative shall have the right to participate
in (but not control) the defense of such Tax Contest (including participating in any discussions with the applicable Tax Authorities
regarding such Tax Contests).


 


(v)
Notwithstanding anything to the contrary contained in this Agreement, the procedures for all Tax Contests shall be governed exclusively
by this Section 7.5(e) (and not Section 8.4(a)).


 


(f)
Withholding. Notwithstanding any other provision in this Agreement to the contrary, Buyer and the Company shall have the
right to deduct and withhold any required Taxes from any payments to be made hereunder. To the extent that amounts are so withheld
and paid to the appropriate Taxing Authority, such withheld amounts shall be treated for all purposes of this Agreement as having
been delivered and paid to the applicable recipient of payment in respect of which such deduction and withholding was made.


 


(g)
Adjustments to Purchase Price. The parties hereto agree to treat any amounts payable after the Closing Date by any Seller
Party to Buyer (or by Buyer to any Seller Party) pursuant to this Agreement as an adjustment to the purchase price payable hereunder,
unless otherwise required by Law or the good faith resolution of an audit.


 




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(h)
Omitted.


 


(i)
Election Pursuant to Section 338 of the Code.


 


(i)
At the Buyer’s option, the Company and Seller Parties shall join with the Buyer in making an election under Code Section
338(h)(10) (and any corresponding election under state, local and foreign Tax Law) with respect to the purchase and sale of the
Shares hereunder (collectively, a “Code Section 338(h)(10) Election”). Seller Parties shall include any income,
gain, loss, deduction or other tax item resulting from the Code Section 338(h)(10) Election on their Tax Returns and the Company’s
Tax Returns to the extent required by applicable Law.


 


(ii)
In the event that the Code Section 338(h)(10) Election is made in accordance with the terms herein, the Buyer and the Seller Parties
agree that the Purchase Price payable hereunder and all other capitalizable costs will be allocated among the assets of the Company
for all purposes (including financial accounting and Tax, to the extent required under the Code) by using the residual method
in a manner consistent Code Sections 1060 and 338 (if applicable) and the regulations thereunder (the “Allocation”).
Consistent with Code Section 1060 and the regulations thereunder, the Buyer shall prepare the Allocation and shall submit the
Allocation to the Seller Party Representative for review, comment and approval if the Buyer is contemplating making the Code Section
338(h)(10) Election. If the Seller Party Representative notifies the Buyer in writing that the Seller Party Representative is
disputing the Allocation within twenty (20) days following the Seller Party Representative’s receipt of the Allocation,
then the Seller Party Representative and the Buyer shall mutually negotiate the Allocation in good faith. If the Seller Party
Representative fails to notify the Buyer in writing that the Seller Party Representative is disputing the Allocation within such
twenty (20)-day period, then the Seller Party Representative and the Seller Parties shall be deemed to have accepted the Allocation
as prepared by the Buyer and such Allocation shall be final, binding and conclusive on the parties hereto. If the Seller Party
Representative disputes the Allocation in a timely manner as provided in this Section 7.5(i)(ii) and the Seller Party Representative
and the Buyer cannot agree on the Allocation within twenty (20) days following the Buyer’s receipt of the Seller Party Representative’s
written notice of dispute, then either party may submit the dispute for binding resolution to a nationally or regionally recognized
independent accounting firm mutually acceptable to the Buyer and the Seller Party Representative (the “Accounting Firm”).
All fees and expenses of the Accounting Firm shall be borne fifty percent (50%) by Buyer and fifty percent (50%) by the Seller
Parties. If the Code Section 338(h)(10) Election is made, then the Buyer and the Seller Parties shall file all Tax Returns (including
amended returns and claims for refund) and information reports in a manner consistent with the Allocation.


 


(j)
Survival. Notwithstanding anything in this Agreement to the contrary, the provisions of this Section 7.5 shall survive
for the full period of all applicable statutes of limitations (giving effect to any waiver, mitigation, or extension thereof)
plus sixty (60) days.


 




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Section
7.6 Conduct of Business Prior to Closing. From the date hereof until the Closing, except as otherwise provided in this
Agreement or consented to in writing by Buyer, the Seller Parties shall, and shall cause the Company to, (x) conduct the business
of the Company in the ordinary course of business consistent with past practice; and (y) use reasonable best efforts to maintain
and preserve intact the current organization, business and franchise of the Company and to preserve the rights, franchises, goodwill
and relationships of its employees, customers, lenders, suppliers, regulators and others having business relationships with the
Company. Without limiting the foregoing, from the date hereof until the Closing Date, the Seller Parties shall:


 


(a)
cause the Company to preserve and properly maintain all of its Licenses;


 


(b)
cause the Company to maintain and protect the properties and assets owned, operated or used by the Company in the same condition
as they were on the date of this Agreement, subject to reasonable wear and tear;


 


(c)
not amend, or allow the Company to amend, any Contract; and


 


(d)
cause the Company to comply with all applicable Laws.


 


Section
7.7 Approvals and Consents. The Seller Parties shall, and shall cause the Company to, as promptly as possible, (a) make,
or cause or be made, all filings and submissions required under any Law applicable to such party or any of its Affiliates and
(b) use reasonable best efforts to obtain, or cause to be obtained, all consents, authorizations, orders and approvals from all
Governmental Authorities that may be or become necessary for its execution and delivery of this Agreement and the performance
of its obligations pursuant to this Agreement and the Ancillary Agreements. The Seller Parties shall, and shall cause the Company
to, cooperate fully with the Buyer and its Affiliates in promptly seeking to obtain all such consents, authorizations, orders
and approvals. The parties hereto shall not willfully take any action that will have the effect of delaying, impairing or impeding
the receipt of any required consents, authorizations, orders and approvals.


 


Section
7.8 Notice of Certain Events. From the date hereof until the Closing, the Seller Party Representative shall promptly notify
Buyer in writing of (a) any fact, circumstance, event or action the existence, occurrence or taking of which has had or could
reasonably be expected to have a material adverse effect on the Company or the Business, (b) any notice or other communication
from any Person alleging that a consent may be required in connection with the Contemplated Transactions, (c) any notice or other
communication from any Governmental Authority, (d) any breach of this Agreement, and (e) any Action commenced or threatened against
the Company or any Seller Party.


 


Section
7.9 Access to Information. From the date hereof until the Closing, the Seller Parties shall, and shall cause the Company
to, (a) afford Buyer and its Representatives full and free access to and the right to inspect all of the properties, assets, premises,
books and records, Contracts and other documents and data related to the Company; (b) furnish Buyer and its Representatives with
such financial, operating and other data and information related to the Company as Buyer or any of its Representatives may reasonably
request; and (c) instruct the Seller Party Representative and the Company to cooperate with Buyer in its investigation of the
Company. No investigation by Buyer or other information received by Buyer shall operate as a waiver or otherwise affect any representation,
warranty or agreement given or made by the Company or any Seller Party in this Agreement.


 




    	-31-



     


    




 


Section
7.10 Additional Covenants. In addition to the other terms and conditions in this Agreement, the Seller Parties shall cooperate
with Buyer in good faith in order to promptly transfer and/or transition the Company’s current medical waste vendor and
payments vendor directly to the Company, each of which are currently being handled by an entity that is an affiliate of the Company
prior to the Closing. 


 


ARTICLE
VIII

INDEMNIFICATION


 


Section
8.1 Survival.


 


(a)
The representations and warranties of the parties hereto contained in or made pursuant to this Agreement or in any certificate
delivered pursuant hereto will survive the Closing and continue in full force and effect indefinitely or, if earlier, until the
latest date permitted by applicable Law. All covenants and agreements that contemplate performance after the date hereof will
survive in accordance with their express terms plus sixty (60) days, and if no time periods are specified therein, then
such covenants and agreements shall survive indefinitely, the latest date permitted by Law or until satisfaction.


 


(b)
Notwithstanding anything in this Section 8.1 to the contrary, (i) if written notice of a claim for indemnification shall
have been given on or prior to the expiration of the applicable survival period specified herein, the representations, warranties,
covenants, and agreements that are the subject of such claim will survive (with respect to such claim) until such time as such
claim has been fully and finally resolved; and (ii) any claim for indemnification based on fraud or intentional misrepresentation
will survive the Closing indefinitely.


 


Section
8.2 Indemnification by the Seller Parties. Subject to the other terms and conditions of this ARTICLE VIII, each
Seller Party, jointly and severally, shall indemnify each of the Buyer Indemnified Parties against, and shall hold each of the
Buyer Indemnified Parties harmless from and against, any and all Losses incurred or sustained by, or imposed upon, any of the
Buyer Indemnified Parties based upon, arising out of, with respect to, or by reason of:


 


(a)
any inaccuracy in, or breach of, any of the representations or warranties of such Seller Party contained in ARTICLE IV
and ARTICLE V of this Agreement (or any certificate required to be delivered by such Seller Party in connection therewith);
and


 


(b)
any breach or non-fulfillment of any covenant, agreement, or obligation to be performed by the Company or the Seller Parties contained
in this Agreement (other than a particular Seller Party’s breach of any of such Seller Party’s covenants contained
in Section 7.2 of this Agreement);


 


(c)
any and all Pre-Closing Taxes;


 




    	-32-



     


    

 


(d)
any transferability issues relating to any License or asset used in connection with the Business;


 


(e)
any and all operations of the Company and/or Business prior to the Closing Date;


 


(f)
any and all outstanding Indebtedness of the Company as of the Closing;


 


(g)
any and all outstanding Company Transaction Expenses as of the Closing; or


 


(h)
any and all issues related to the any of the Seller Parties conditions to Closing.


 


Section
8.3 Indemnification by Buyer. Subject to the other terms and conditions of this ARTICLE VIII, Buyer shall indemnify
each of the Seller Party Indemnified Parties against, and shall hold each of the Seller Party Indemnified Parties harmless from
and against, any and all Losses incurred or sustained by, or imposed upon, any of the Seller Party Indemnified Parties, arising
out of, with respect to, or by reason of:


 


(a)
any inaccuracy in, or breach of, any of the representations or warranties of Buyer contained in this Agreement or any certificate
required hereunder to be delivered at the Closing by Buyer; or


 


(b)
any breach or non-fulfillment of any covenant, agreement, or obligation to be performed by Buyer pursuant to this Agreement.


 


Section
8.4 Indemnification Procedures.


 


(a)
Third Party Claims. If any third party shall notify any party hereto (the “Indemnified Party”)
with respect to any matter (a “Third Party Claim”) which may give rise to a claim by such Indemnified Party
for indemnification against any other party hereto (the “Indemnifying Party”) under this ARTICLE VIII,
the Indemnified Party shall give the Indemnifying Party (or the Seller Party Representative in the case of an indemnification
claim pursuant to Section 8.2) prompt written notice thereof. The failure to give such prompt written notice shall not,
however, relieve the Indemnifying Party of its indemnification obligations, except and only to the extent that the Indemnifying
Party demonstrates that the Indemnifying Party’s ability to defend or resolve such claim is materially and adversely affected
thereby. Such written notice by the Indemnified Party shall describe in reasonable detail (based on information then available
to the Indemnified Party) the Third Party Claim and the estimated amount, if reasonably practicable, of the Loss that has been
or may be sustained by the Indemnified Party.


 


(b)
Direct Claims. If an Indemnified Party has a claim for indemnification hereunder that does not involve a Third Party Claim
(a “Direct Claim”), the Indemnified Party shall give the Indemnifying Party (or the Seller Party Representative
in the case of an indemnification claim pursuant to Section 8.2) prompt written notice thereof. The failure to give such
prompt written notice shall not, however, relieve the Indemnifying Party of its indemnification obligations, except and only to
the extent that the Indemnifying Party demonstrates that the Indemnifying Party’s ability to defend or resolve such Direct
Claim is materially and adversely affected thereby. Such notice by the Indemnified Party shall describe in reasonable detail (based
on information then available to the Indemnified Party) the Direct Claim and the estimated amount, if reasonably practicable,
of the Loss that has been or may be sustained by the Indemnified Party (the “Claimed Amount”). Within thirty
(30) days after delivery of such notice, the Indemnifying Party (or the Seller Party Representative in the case of an indemnification
claim pursuant to Section 8.2) shall deliver to the Indemnified Party a written response in which the Indemnifying Party
(or the Seller Party Representative in the case of an indemnification claim pursuant to Section 8.2) shall (i) agree that
the Indemnified Party is entitled to receive all of the Claimed Amount (in which case such response shall be accompanied by a
payment by the Indemnifying Party of the Claimed Amount), (ii) agree that the Indemnified Party is entitled to receive part, but
not all, of the Claimed Amount (the “Agreed Amount”) (in which case such response shall be accompanied by payment
by the Indemnifying Party of the Agreed Amount), or (iii) in good faith dispute that the Indemnified Party is entitled to receive
any of the Claimed Amount. If the Indemnifying Party (or the Seller Party Representative in the case of an indemnification claim
pursuant to Section 8.2) timely disputes the payment of all or part of the Claimed Amount, then the Indemnifying Party
and the Indemnified Party may assert all rights available to such party hereunder. If the Indemnifying Party does not so respond
within the applicable time period set forth above, the Indemnifying Party shall be deemed to have accepted such claim and shall
pay the Claimed Amount in full.


 




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Section
8.5 Exclusive Remedy. Except for (a) the remedies of specific performance or injunctive or other equitable relief or (b)
claims for fraud, intentional misrepresentation or willful misconduct, the indemnification rights set forth in this ARTICLE
VIII shall be the sole and exclusive monetary remedy of the parties hereto for any claim arising out of this Agreement or
the Contemplated Transactions.


 


Section
8.6 Additional Indemnification Provisions. Each party hereto acknowledges and agrees that the representations, warranties,
covenants, and agreements in this Agreement are the product of negotiations among the parties hereto and represent an agreed-upon
contractual allocation of risk among the parties hereto. Each party hereto shall be entitled to rely upon, and shall be deemed
to have relied upon, all of the representations, warranties, covenants, and agreements of each other party hereto set forth herein
(as qualified by the Schedules hereto), and the rights to indemnification and payment of Losses under this ARTICLE VIII
based on a breach of any of the representations, warranties, covenants, or agreements set forth in this Agreement (as qualified
by the Schedules hereto) shall not be affected by any investigation conducted (or capable of being conducted) at any time, or
any knowledge acquired (or capable of being acquired) at any time, whether before or after the execution and delivery of this
Agreement, by or on behalf of any of the parties hereto with respect to the accuracy or inaccuracy of or compliance with any such
representations, warranties, covenants, or agreements.


 


ARTICLE
IX

MISCELLANEOUS


 


Section
9.1 Termination. This Agreement may be terminated at any time prior to the Closing: (a) by mutual written consent of the
Buyer and Seller Party Representative, (b) by Buyer if the conditions set forth in Sections 3.2(a), (b) or (c) have
not been met by the Closing, (c) by the Seller Party Representative if the conditions set forth in Sections 3.3(a), (b) or
(c) have not been met by the Closing, or (d) by either the Buyer or Seller Party Representative if the Closing does not
occur by October 31, 2020, which may be extended by Buyer for up to thirty (30) days in Buyer’s sole discretion. In the
event of the termination of this Agreement in accordance with this Section 9.1, this Agreement shall forthwith become void
and there shall be no liability on the part of any party hereto except (i) with respect to confidentiality obligations and (ii)
that nothing herein shall relieve any party hereto from liability for any willful breach of any provision of this Agreement. 


 




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Section
9.2 Notices. All notices, requests, consents, claims, demands, waivers, and other communications hereunder shall be in
writing and shall be deemed to have been given: (a) when delivered by hand (with written confirmation of receipt); (b) when received
by the addressee if sent by a nationally recognized overnight courier (receipt requested); (c) on the date sent by facsimile or
e-mail of a PDF document (with confirmation of transmission) if sent during normal business hours of the recipient, and on the
next Business Day if sent after normal business hours of the recipient; or (d) on the third (3rd) day after the date
mailed, by certified or registered mail, return receipt requested, postage prepaid. Such communications must be sent to the respective
parties hereto at the following addresses (or at such other address for a party hereto as shall be specified in a notice given
in accordance with this Section 9.2):


 


If
to Seller Party Representative or any Seller Party:


 


Arvind
Guranani


21
Donsen Ln


Scotch
Plains NJ 07076


Email:
agurnani@synergymedlabs.com


 


If
to Buyer:


 


ProPhase
Labs, Inc.


621
N. Shady Retreat Road


Doylestown,
Pennsylvania 18901


Attention:
Ted Karkus, Chief Executive Officer


Email:
Karkus@prophaselabs.com


 


with
a copy (which will not constitute notice) to:


 


Reed
Smith LLP


599
Lexington Ave


New
York, NY 10022


E-mail:
HKozlov@ReedSmith.com


Facsimile:
(212) 521-5450


Attention:
Herbert F. Kozlov


 


Section
9.3 Expenses. Except as otherwise expressly set forth herein, each party hereto shall be responsible for and shall pay
all of its own costs and expenses (including the fees and expenses of its attorneys, accountants, investment bankers and other
advisors) incurred in connection with this Agreement and the Contemplated Transactions; provided, that the Seller Parties
shall be responsible for and shall pay all of the Company’s Transaction Expenses.


 




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Section
9.4 Interpretation. For purposes of this Agreement: (a) the definition of terms herein shall apply equally to the singular
and the plural; (b) any pronoun shall include the corresponding masculine, feminine, and neuter forms; (c) the words “include”,
“includes”, and “including” shall be deemed to be followed by the words “without limitation”;
(d) the word “or” is not exclusive; (e) the words “herein”, “hereof”, “hereby”,
“hereto”, and “hereunder” refer to this Agreement as a whole; and (f) the words “will” and
“shall” have equal force and effect. Unless the context otherwise requires, references herein: (i) to Articles, Sections,
Schedules, and Exhibits mean the Articles and Sections of, and Schedules, and Exhibits attached to, this Agreement; (ii) to an
agreement, instrument, or other document means such agreement, instrument, or other document as amended, supplemented, and modified
from time to time to the extent permitted by the provisions thereof; and (iii) to a Law means such Law as amended from time to
time and includes any successor legislation thereto and any rules and regulations promulgated thereunder. The parties hereto have
participated jointly in the negotiation and drafting of this Agreement. In the event that an ambiguity or a question of intent
or interpretation arises, this Agreement shall be construed as if drafted jointly by the parties hereto, and no presumption or
burden of proof shall arise favoring or disfavoring any party hereto by virtue of the authorship of any provision of this Agreement.


 


Section
9.5 Tables and Headings. The table of contents, table of defined terms, and headings set forth in this Agreement are for
convenience of reference only and shall not affect in any way the meaning or interpretation of this Agreement.


 


Section
9.6 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 hereto 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.


 


Section
9.7 Entire Agreement. This Agreement and the Ancillary Agreements constitute the sole and entire agreement of the parties
hereto with respect to the subject matter contained herein and therein, and supersede all prior and contemporaneous representations,
warranties, understandings and agreements, both written and oral, with respect to such subject matter in any way. In the event
of any inconsistency between the statements in the body of this Agreement and those in the Ancillary Agreements, the Exhibits,
and Schedules (other than an exception expressly set forth as such in the Schedules), the statements in the body of this Agreement
will control.


 


Section
9.8 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; provided, however, that prior to the Closing Date, Buyer may, without the prior written
consent of any Person, assign all or any portion of its rights under this Agreement to one or more of its direct or indirect subsidiaries
or to any of its lenders. No assignment shall relieve the assigning party of any of its obligations hereunder.


 




    	-36-



     


    

 


Section
9.9 No Third Party Beneficiaries. Except as provided in Section 7.4 and ARTICLE VIII, this Agreement is for
the sole benefit of the parties hereto and their respective heirs, legal representatives, 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.


 


Section
9.10 Amendment and Modification; Waiver. This Agreement may only be amended, modified, or supplemented by an agreement
in writing signed by each party hereto. No waiver by any party hereto of any of the provisions hereof shall be effective unless
explicitly set forth in writing and signed by the party hereto so waiving. No waiver by any party hereto shall operate or be construed
as a waiver in respect of any failure, breach, or default not expressly identified by such written waiver, whether of a similar
or different character, and whether occurring before or after that waiver. 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.


 


Section
9.11 Governing Law; Submission to Jurisdiction; Waiver of Jury Trial.


 


(a)
This Agreement shall be governed by and construed in accordance with the internal laws of the State of Delaware without giving
effect to any choice or conflict of law provision or rule (whether of the State of Delaware or any other jurisdiction) that would
cause the application of Laws of any jurisdiction other than those of the State of Delaware.


 


(b)
ANY LEGAL SUIT, ACTION OR PROCEEDING ARISING OUT OF OR BASED UPON THIS AGREEMENT, THE ANCILLARY AGREEMENTS OR THE CONTEMPLATED
TRANSACTIONS MAY BE INSTITUTED IN THE FEDERAL COURTS OF THE UNITED STATES OF AMERICA OR THE COURTS OF THE STATE OF NEW YORK IN
EACH CASE LOCATED IN THE CITY OF NEW YORK AND COUNTY OF NEW YORK, AND EACH PARTY IRREVOCABLY SUBMITS TO THE EXCLUSIVE JURISDICTION
OF SUCH COURTS IN ANY SUCH SUIT, ACTION OR PROCEEDING. SERVICE OF PROCESS, SUMMONS, NOTICE OR OTHER DOCUMENT BY UNITED STATES
CERTIFIED MAIL, RETURN RECEIPT REQUESTED, TO SUCH PARTY’S ADDRESS SET FORTH HEREIN SHALL BE EFFECTIVE SERVICE OF PROCESS
FOR ANY SUIT, ACTION OR OTHER PROCEEDING BROUGHT IN ANY SUCH COURT. THE PARTIES IRREVOCABLY AND UNCONDITIONALLY WAIVE ANY OBJECTION
TO THE LAYING OF VENUE OF ANY SUIT, ACTION OR ANY PROCEEDING IN SUCH COURTS AND IRREVOCABLY WAIVE AND AGREE NOT TO PLEAD OR CLAIM
IN ANY SUCH COURT THAT ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.


 




    	-37-



     


    

 


(c)
EACH PARTY ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY WHICH MAY ARISE UNDER THIS AGREEMENT OR THE ANCILLARY AGREEMENTS IS LIKELY
TO INVOLVE COMPLICATED AND DIFFICULT ISSUES AND, THEREFORE, EACH SUCH 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, THE ANCILLARY AGREEMENTS
OR THE CONTEMPLATED TRANSACTIONS. EACH PARTY TO THIS AGREEMENT CERTIFIES AND ACKNOWLEDGES THAT (i) 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, (ii) SUCH PARTY HAS CONSIDERED THE IMPLICATIONS OF THIS WAIVER, (iii) SUCH PARTY MAKES THIS WAIVER VOLUNTARILY,
AND (iv) SUCH PARTY HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS
IN THIS SECTION 1.01(C).


 


Section
9.12 Specific Performance. The parties agree that irreparable damage would occur if any provision of this Agreement were
not performed in accordance with the terms hereof and that the parties shall be entitled to seek specific performance of the terms
hereof, in addition to any other remedy to which they are entitled at law or in equity.


 


Section
9.13 Seller Party Representative; Power of Attorney.


 


(a)
Each of the Seller Parties, by such Seller Party’s execution and delivery of this Agreement, hereby appoints and constitutes
Arvind Gurnani (the “Seller Party Representative”) as such Seller Party’s true and lawful representative,
agent, and attorney-in-fact, with full power of substitution and re-substitution, to act for and on behalf of such Seller Party
for the purpose of taking any and all actions by such Seller Party specified in or contemplated by this Agreement, including as
representative, agent, and attorney-in-fact for such Seller Party (i) to receive all agreements, certificates, and other documents
to be delivered by Buyer at the Closing; (ii) to execute and deliver any amendment or waiver of any provision of this Agreement
pursuant to Section 9.10; (iii) to give and receive notices or service of process on behalf of such Seller Party under
this Agreement; (iv) to control the defense, compromise, or settlement of all indemnification claims pursuant to ARTICLE VIII
and to engage in discussions, negotiations, and other dispute resolution with Buyer and any other Buyer Indemnified Party
regarding all such indemnification claims; and (v) to receive as agent for, and on behalf of and for the benefit of, such Seller
Party any and all payments and other amounts to be remitted by Buyer to such Seller Party hereunder or under any of the Ancillary
Agreements.


 


(b)
The Seller Party Representative hereby accepts his appointment as the Seller Party Representative hereunder and agrees that it
shall not be entitled to any fee or other compensation for the performance of the Seller Party Representative’s services
hereunder.


 




    	-38-



     


    

 


(c)
Any decision, act, consent or instruction of the Seller Party Representative under this Agreement (each, an “Authorized
Action”) shall constitute a decision of each Seller Party and shall be final, binding and conclusive upon each Seller
Party, and Buyer shall be entitled to rely conclusively without inquiry or verification upon any such Authorized Action as being
the decision, act, consent or instruction of each Seller Party. Each Seller Party agrees to pay, and to indemnify and hold harmless,
each of the Buyer Indemnified Parties from and against any Losses which they may suffer, sustain or become subject to as the result
of any claim by any Person that an Authorized Action is not binding on, or enforceable against any Seller Party. In addition,
each Seller Party hereby releases and discharges each of the Buyer Indemnified Parties from and against any Losses arising out
of or in connection with the Seller Party Representative’s failure to distribute any amounts received by the Seller Party
Representative on behalf of the Seller Parties to the Seller Parties.


 


(d)
The power of attorney granted hereby (i) is coupled with an interest, (ii) shall survive and not be affected by the subsequent
death, incapacity, disability, dissolution, termination or bankruptcy, as applicable, of any Seller Party, (iii) shall be binding
upon the successors, assigns, heirs, executors, administrators, legal representatives, and beneficiaries, as applicable, of each
of the Seller Parties, and (iv) is being relied on by Buyer in connection with the Buyer’s willingness to enter into this
Agreement and to purchase the Shares.


 


(e)
Each Seller Party hereby agrees to indemnify, defend and hold harmless the Seller Party Representative from and against any and
all loss, liability, or expense (including the reasonable fees and expenses of the Seller Party Representative’s attorneys)
arising out of or in connection with any act or failure to act of the Seller Party Representative hereunder, except to the extent
that such loss, liability or expense is finally adjudicated to have been primarily caused by the gross negligence or willful misconduct
of the Seller Party Representative; provided, however, that no Seller Party shall be liable under this Section
9.13(e) in excess of such Seller Party’s Pro Rata Percentage of the Purchase Price.


 


(f)
The Seller Party Representative may resign upon not less than fifteen (15) Business Days’ prior written notice to Buyer
and the Seller Parties. The Seller Parties, by the vote of the holders of a majority-in-interest of the Shares collectively owned
by the Seller Parties immediately prior to the Closing, may remove the Seller Party Representative from time to time upon not
less than fifteen (15) Business Days’ prior written notice to Buyer. Any vacancy in the position of the Seller Party Representative
(whether due to resignation, removal, or otherwise) shall be filled by another Seller Party approved by the holders of a majority-in-interest
of the Shares collectively owned by the Seller Parties immediately prior to the Closing, and any such successor Seller Party Representative
shall be subject to the prior written consent of Buyer, which consent shall not be unreasonably withheld, conditioned, or delayed.
Any successor Seller Party Representative shall acknowledge in writing to Buyer his, her, or its acceptance of the appointment
as the Seller Party Representative in accordance with the terms of this Section 9.13.


 


Section
9.14 Entire Agreement. This Agreement (including the Exhibits, Schedules and Annexes hereto) and the Ancillary Agreements
constitute the entire agreement and understanding, and supersede any and all prior and/or contemporaneous agreements and understandings,
both written and oral, among the parties hereto with respect to the subject matter hereof.


 


Section
9.15 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 have the same legal effect as delivery of an original signed copy of this Agreement.


 


[SIGNATURE
PAGE FOLLOWS]


 




    	-39-



     


    

 


IN
WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the date first written above.


 


	COMPANY:	 	BUYER:
	 	 	 	 
	CONFUCIUS
    PLAZA MEDICAL LABORATORY CORP.	 	PROPHASE
    DIAGNOSTICS, INC.
	 	 	 	 	 
	By:	/s/
    Arvind Gurnani	 	By:	/s/
                                         Ted Karkus

	Name:
    	Arvind
    Gurnani	 	Name:
    	Ted
    Karkus
	Title:	President	 	Title:	Chief
    Executive Officer
	 	 	 	 	 
	SELLER
    PARTIES: 	 	 	 
	 	 	 	 
	PRIDE
    DIAGNOSTICS LLC	 	 	 
	 	 	 	 	 
	By:
    	/s/
    Arvind Gurnani	 	 	 
	Name:	Arvind
                                         Gurnani
	 	 	 
	Title:
    	Managing
    Member	 	 	 
	 	 	 	 	 
	/s/
    Nelson Herrera	 	 	 
	Nelson
    Herrera 	 	 	 
	 	 	 	 
	/s/
    Arvind Gurnani	 	 	 
	Arvind
    Gurnani	 	 	 
	 	 	 	 
	/s/
    Michael Messina	 	 	 
	Michael
    Messina	 	 	 
	 	 	 	 
	SELLER
    PARTY REPRESENTATIVE: 	 	 	 
	 	 	 	 
	/s/
    Arvind Gurnani	 	 	 
	Arvind
    Gurnani	 	 	 


 


[Signature
Page to Stock Purchase Agreement]

 




    	 



     


    

 


SCHEDULE
1.1


 


Defined
Terms; References


 


“Action”
means any civil, criminal or administrative action, claim, litigation, arbitration, inquiry, audit, examination, investigation,
or other proceeding of any nature by or before any Governmental Authority (including any Tax Contest).


 


“Affiliate”
of a Person means any other Person that directly or indirectly, through one or more intermediaries, controls, is controlled by,
or is under common control with, such Person. The term “control” (including the terms “controlled by”
and “under common control with”) means the possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of a Person, whether through the ownership of voting securities, by contract or otherwise.


 


“Affiliated
Group” means any affiliated group of corporations or other entities that files a combined, consolidated, unitary or
similar Tax Return that includes (or was required to include) the Company, including any affiliated group within the meaning of
1504(a) of the Code or any similar group defined under a similar provision of applicable Law.


 


“Ancillary
Agreements” means any other agreements, documents and certificates executed and delivered by the parties hereto or thereto
in connection with the consummation of the Contemplated Transactions.


 


“Business”
means the business of a full service clinical and molecular laboratory certified by The Clinical Laboratory Improvement Amendments
of 1988 and that provides (without limitation) a wide range of testing for diagnosis, screening or evaluation of diseases and
health conditions from specimens obtained from certain states including (without limitation) New Jersey, New York, and Pennsylvania.


 


“Business
Day” means any day other than Saturday, Sunday or any other day on which commercial banks in New York, New York are
authorized or required by applicable Law to be closed.


 


“Business
Personnel” means the employees of, and independent contractors providing services to, the Company.


 


“Buyer
Indemnified Parties” means (a) Buyer, (b) its Affiliates and subsidiaries (which after the Closing shall include the
Company), (c) their respective equityholders, members, partners, and Representatives, and (d) their respective heirs, executors,
successors, and permitted assigns.


 


“Code”
means the Internal Revenue Code of 1986, as amended, and the Treasury Regulations promulgated thereunder.


 




    	 



     


    

 


“Confidential
Information” means all trade secrets, know-how, and other confidential or proprietary information and data of or relating
to the Company or the Business (whether or not expressly identified as confidential or proprietary), including: (a) the Company’s
business information and materials, including financial information, books and records, business plans, business proposals, customer
and vendor contract terms and conditions, pricing and bidding methodologies and sales data, current or prospective customer lists,
contact information, preferences, and other business information, supplier lists, contact information, preferences, and other
business information, business partner lists, contact information, preferences and other business information, and similar information;
(b) the Company’s personnel information and materials, including employee lists and contact information, employee performance
information, employee compensation information, recruiting sources, contractor, and consulting information, contacts, and costs,
and similar information; (c) the Company’s information and materials relating to future plans, including marketing strategies,
pending projects and proposals, proprietary production processes, research and development strategies, and similar items; (d)
the Company’s technical information and materials, including computer programs, software, databases, methods, know-how,
formulae, compositions, technological data, technological prototypes, processes, discoveries, machines, inventions, and similar
items; and (e) any other information or material that gives the Company an advantage with respect to its competitors by virtue
of not being known by those competitors.


 


“Contemplated
Transactions” means the sale and purchase of the Shares and the other transactions contemplated by this Agreement and
the Ancillary Agreements.


 


“Contract”
means, with respect to any Person, any contract, license, sublicense, mortgage, purchase order, indenture, loan agreement, lease,
sublease, agreement, or instrument, or any binding commitment to enter into any of the foregoing (in each case, whether written
or oral) to which such Person is a party or by which any of its assets are bound.


 


“Employee
Benefit Plan” means all pension, profit sharing, retirement, stock purchase, stock option, bonus, incentive compensation
(including equity options or incentives, restricted equity, equity bonus, and deferred bonus plans) and deferred compensation
plans, life, health, dental, accident or disability, workers’ compensation, personnel policy (including vacation time, holiday
pay, bonus programs, moving expense reimbursement programs and sick leave), or other employee welfare benefit plans (insured or
self-insured), educational assistance, pretax premium or flexible spending account plans, supplemental or executive benefit plans,
non-qualified retirement plans, severance or separation plans, employment agreements, consulting agreements, and any other employee
benefit plans, practices, policies, or arrangements of any kind, whether written or oral, which are currently sponsored, maintained
or contributed to by the Company or any of its Affiliates for the benefit of any of its employees (including former employees),
or under which the Company or any of its Affiliates has any current or potential Liability (whether actual, potential or contingent)
with respect to any employee or former employee or the dependents of any such employee or former employee, including any “employee
benefit plan” (as defined in ERISA 3(3)), whether or not such plan is subject to ERISA.


 


“Enforceability
Exceptions” means (a) any applicable bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium, and other
similar laws relating to or affecting creditors’ rights generally or (b) any general principles of equity.


 


“Environmental
Laws” means all Laws, common law, and related regulations concerning public health and safety, occupational safety and
health hazards, pollution, or protection of the environment, including: all those relating to the presence, use, production, generation,
handling, transportation, treatment, storage, disposal, distribution, labeling, testing, processing, discharge, Release, threatened
Release, control, or cleanup of any Hazardous Materials, substances or wastes, chemical substances or mixtures, pesticides, pollutants,
contaminants, toxic chemicals, petroleum products or byproducts, asbestos, polychlorinated biphenyls, noise, or radiation, in
each case, as the foregoing Laws have been or may be amended or supplemented and any analogous federal, state, provincial, or
local Law promulgated pursuant thereto and such other Laws (domestic or foreign) relating to or addressing similar subject matter
of any of the foregoing or amendments to the foregoing.


 




    	 



     


    

 


“Equity
Securities” means any (a) units, stock, shares, partnership interests or other equity securities or capital interests,
(b) warrants, options or other rights to purchase or otherwise acquire any of the securities described in clause (a) of
this definition, (c) equity appreciation rights or profits interests, and (d) obligations, evidences of Indebtedness or other
securities or interests convertible or exchangeable into any of the securities described in clause (a), (b) or (c)
of this definition.


 


“ERISA”
means the Employee Retirement Income Security Act of 1974, as amended, and the rules and regulations promulgated thereunder.


 


“Governmental
Authority” means any federal, state, local, or foreign government or political subdivision thereof, or any agency or
instrumentality of such government or political subdivision, or any self-regulated organization or other non-governmental regulatory
authority or quasi-governmental authority (to the extent that the rules, regulations, or orders of such organization or authority
have the force of Law), or any arbitrator, court, or tribunal of competent jurisdiction.


 


“Hazardous
Materials” means all hazardous substances, as that term is defined under the federal Comprehensive Environmental Response,
Compensation, and Liability Act of 1980, as amended, any waste or other substance that is listed, defined, designated, or classified
as, or otherwise determined to be, hazardous, radioactive, or toxic, or a pollutant or contaminant under or pursuant to any Environmental
Law, including petroleum and derivatives thereof, asbestos and asbestos-containing materials, PCBs, perfluoroalkyl substances
(PFASs), urea formaldehyde, pesticides, herbicides, and fertilizers natural gas liquids, lead and lead-based paints and materials,
flammable, explosive, or radioactive materials, microbial matter, biological toxins, mycotoxins, mold or mold spores, radon, and
any other agriculture chemicals.


 


“Income
Tax” means any Tax based on or measured by reference to gross or net income or receipts, and franchise, net worth, capital
or other doing business Taxes, including any interest, penalty or addition thereto, irrespective of whether disputed.


 


“Indebtedness”
means, with respect to any Person, as of any time, without duplication, all obligations, including the outstanding principal amount
of, accrued and unpaid interest on, and other liquidated payment obligations (including any prepayment penalties, premiums, costs,
breakage, or other amounts payable in connection with the prepayment, repayment, or retirement thereof) of such Person consisting
of or related to (a) indebtedness for borrowed money or indebtedness issued in substitution or exchange for borrowed money, (b)
indebtedness evidenced by any note, bond, debenture, or other debt security (including a purchase money obligation), (c) obligations
under leases that are required to be capitalized, (d) obligations for the deferred purchase price of property, goods, or services,
including any deferred purchase price Liabilities, contingent payments, earnouts, installment payments, seller notes, promissory
notes, or similar Liabilities (including trade payables) and, for the avoidance of doubt, in each case, whether or not contingent,
(e) letters of credit (whether drawn or undrawn), (f) all obligations under any currency or interest rate swap, hedge, or similar
agreement or arrangement (with respect to the Company and the Business, determined as if such instrument were terminated as of
the Closing Date), (g) all Income Taxes for any Pre-Closing Period and for the portion of any Straddle Period ending on and including
the Closing Date determined in accordance with this Agreement, and (h) guarantees of any Liability of a third party of the type
described in the foregoing clauses (a) through (f).


 




    	 



     


    

 


“Intellectual
Property Rights” means all United States and foreign intellectual property rights and other similar proprietary rights
of any kind or nature, whether owned or held for use under license and whether registered or unregistered, including all of the
following: (a) all patents and patent applications (including all reissues, divisions, continuations, continuations-in-part, re-examinations,
renewals, and extensions thereof); (b) all trademarks, service marks, logos, trade dress, trade names, corporate names, Internet
domain names, and website content, including all common law rights and all goodwill associated therewith or symbolized thereby,
and all applications, registrations and renewals in connection therewith; (c) all copyrights and copyrightable works of authorship;
(d) all rights of publicity, moral rights, and rights of attribution and integrity; (e) all trade secrets, know-how, discoveries,
inventions, ideas, methods, processes, and other confidential or proprietary data and information; (f) all computer software,
including all source code, object code, operating systems, databases, and documentation relating thereto; and (g) all rights to
sue or recover and retain damages, costs and attorneys’ fees for past, present and future infringement, dilution, or misappropriation
of any of the foregoing.


 


“IRS”
means the Internal Revenue Service of the United States.


 


“Law”
means any federal, state, county, provincial, or local, or other foreign law, statute, legislation, constitution, principle of
common law, judicial decision, resolution, ordinance, code, judgment, order, decree, treaty, rule, regulation, ruling, directive,
determination, charge, direction, or other restriction of any Governmental Authority, as well as any act issued by any competent
authority in application thereof.


 


“Liability”
means any liability, debt, obligation, or commitment of any nature whatsoever (whether direct or indirect, known or unknown, accrued
or unaccrued, absolute or contingent or matured or unmatured), including any arising under any Law, License, Action, or Contract
and including any and all liabilities for Taxes.


 


“License”
means any permit, license, franchise, approval, authorization, registration, certificate, variance, consent, or similar right
required to be obtained from, or otherwise issued by, any Governmental Authority.


 


“Lien”
means any lien, pledge, mortgage, deed of trust, security interest, charge, claim, easement, encroachment, transfer restriction,
or other encumbrance of any kind or nature whatsoever.


 




    	 



     


    

 


“Loss”
means any loss, damage, Liability, demand, Action, assessment, judgment, deficiency, cost, penalty, fine, Tax, or other cost or
expense, (including reasonable attorney’s and accountant’s fees, costs, and expenses incurred in investigating or
defending against any Action).


 


“Ordinary
Course” means the ordinary and usual course of business consistent with past custom and practice (including using reasonable
best efforts to preserve intact relationships with customers, suppliers, and key employees) of the Person in question.


 


“Organizational
Documents” means: (a) with respect to a corporation, the certificate or articles of incorporation and bylaws; (b) with
respect to any other entity (including any trust), each charter, certificate of formation, partnership agreement, joint venture
agreement, operating agreement, trust agreement, and similar document, as applicable, adopted or filed in connection with the
creation, formation, or organization of such entity; and (c) any amendment to any of the foregoing.


 


“Permitted
Liens” means: (a) statutory Liens for current Taxes that are not due and payable as of the Closing Date; and (b) with
respect to the Leased Real Property only, zoning, building or other restrictions, variances, rights of way, easements, or other
minor irregularities in title, none of which, individually or in the aggregate, interferes in any material respect with the continued
occupancy or use or value of any of the Leased Real Property for the purpose for which it is used as of the Closing Date.


 


“Person”
means an individual, corporation, partnership, joint venture, limited liability company, joint stock company, estate, labor union,
Governmental Authority, unincorporated organization, trust, association, or other entity.


 


“Pre-Closing
Period” means any Taxable period ending on or before the Closing Date.


 


“Pre-Closing
Period Tax Return” means any Tax Return relating to a Pre-Closing Period.


 


“Pre-Closing
Taxes” means, without duplication, (a) any and all Taxes resulting from any election under Section 338(h)(10) of the
Code; (b) all Taxes imposed on or payable by the Company, or for which the Company otherwise may be liable, for any and all Pre-Closing
Periods; (c) any and all Taxes imposed on or payable by the Company, or for which the Company otherwise may be liable, by reason
of being (or ceasing to be) or having been a member of an Affiliated Group on or prior to the Closing Date (or being included
(or required to be included)) in any Tax Return relating thereto; (d) all Liabilities of the Company for any Taxes by reason of
a Tax Sharing Agreement entered into prior to the Effective Time or by reason of transferee or successor liability arising in
respect of a transaction undertaken prior to the Effective Time; (e) any and all Transfer Taxes required to be paid by the Seller
Party; and (f) with respect to any Straddle Period, Taxes imposed on or payable by the Company that are allocable, pursuant to
Section 7.5(b), to the portion of such period through the close of business on the Closing Date.


 


“Pro
Rata Percentage” means, with respect to each Seller Party, the percentage set forth opposite such Seller Party’s
name (and identified as such) on Schedule 4.3(a) identifying the ownership of the Company and ownership of the Selling
Company.


 




    	 



     


    

 


“Related
Party” means (a) any officer, director, or equityholder of the Company or any Seller Party, (b) any individual related
by blood, marriage, or adoption to any individual listed in clause (a) of this definition or to any equityholder of the
Company (including the Seller Parties), or (c) any Person in which any individual listed in clause (a) or (b) of
this definition has a beneficial interest.


 


“Release”
means any spilling, leaking, emitting, discharging, depositing, placing, escaping, leaching, dumping, or other releasing into
the environment, or as otherwise specified in the federal Comprehensive Environmental Response, Compensation, and Liability Act
of 1980, as amended.


 


“Remedial
Action” means any action required by any Environmental Law to investigate, clean up, remove, treat, monitor, report,
or in any other way address any Hazardous Materials.


 


“Representative”
means, with respect to any Person, such Person’s directors, managers, officers, employees, counsel, financial advisors,
accountants, agents, and other representatives.


 


“Schedules”
means the Schedules delivered by the Company, the Seller Parties, and Buyer concurrently with the execution and delivery of this
Agreement.


 


“Seller
Party Indemnified Parties” means (a) any of the Seller Parties, (b) their respective Affiliates and subsidiaries, (c)
their respective equityholders, members, partners and Representatives, and (d) their respective heirs, executors, successors and
permitted assigns. For the avoidance of doubt, after the Closing the term “Seller Party Indemnified Parties” shall
not include the Company.


 


“Straddle
Period” means any Taxable year or period beginning on or before, and ending after, the Closing Date.


 


“Straddle
Period Tax Return” means any Tax Return relating to a Straddle Period.


 


“Taxes”
means (a) all federal, state, county, local, foreign, and other income, gross receipts, sales, use, production, ad valorem, transfer,
franchise, registration, profits, license, lease, service, service use, withholding, payroll, social security, employment, unemployment,
estimated, excise, severance, environmental, stamp, capital stock, alternative or add-on minimum, occupation, premium, property
(real or personal), unclaimed property, escheat, real property gains, windfall profits, customs, duties, estimated, or other taxes,
fees, assessments, or charges of any kind whatsoever (including deficiencies, penalties, additions to tax, and interest attributable
thereto), whether disputed or not; (b) any Liability for the payment of any amounts of the type described in clause (a)
of this definition for the Taxes of any other Person pursuant to 1.1502-6 of the Treasury Regulations (or any comparable provisions
under state, local or non-U.S. Law); and (c) any Liability for the payment of any amounts of the type described in clause (a)
of this definition as a result of any express or implied obligation to indemnify or otherwise assume or succeed to the Liability
of any other Person as a successor or transferee, by Contract, or otherwise.


 


“Tax
Returns” means all returns, reports and other documents of every nature (including elections, declarations, disclosures,
schedules, estimates, and information returns) filed or required to be filed with any Governmental Authority relating to Taxes.


 




    	 



     


    

 


“Taxing
Authority” means any Governmental Authority having jurisdiction over the assessment, determination, collection, or other
imposition of any Tax.


 


“Tax
Sharing Agreement” means any Tax indemnity agreement, Tax sharing agreement, Tax allocation agreement, or similar Contract
or arrangement, whether written or unwritten (including any such agreement, Contract, or arrangement included in any purchase
or sale agreement, merger agreement, joint venture agreement, or other document).


 


“Transaction
Expenses” means the aggregate amount of all fees, costs, expenses, and other amounts incurred or otherwise payable by
or on behalf of any of the Seller Parties or the Company in connection with the negotiation, preparation, execution, and delivery
of this Agreement or any Ancillary Agreement or their consummation of the Contemplated Transactions, including (a) all legal,
accounting, investment banking, and financial intermediary fees, costs, and expenses; (b) all transaction bonuses, retention bonuses,
change of control payments, severance payments, or other bonuses or payments due or payable to current or former directors, officers,
employees, or independent contractors of the Company as a result of or in connection with the consummation of the Contemplated
Transactions (including the employer-paid portion of all employment, payroll or other similar Taxes payable with respect to the
payments described in this clause (b)); (c) all fees, costs, and expenses associated with any of the Company or the Seller
Parties obtaining the release and termination of any Liens; and (d) all fees, costs, and expenses associated with any of the Company
or the Seller Parties obtaining any consents, approvals, or waivers from any Governmental Authority or other third party required
to consummate the Contemplated Transactions.


 


“Transfer
Taxes” means (a) all transfer, documentary, sales, use, excise, value added, recording, stamp, gains, and similar Taxes
imposed in connection with or as a result of the consummation of the Contemplated Transactions, and (b) all interest, penalties,
fines, and additional amounts imposed by any Governmental Authority with respect to such amounts.


 


“Treasury
Regulations” means the final or temporary regulations that have been issued by the United States Department of Treasury
pursuant to its authority under the Code, and any successor regulations.


 




    	 



     


    

 


Each
of the following terms is defined in the Section of this Agreement set forth opposite such term below:


 


	Term	 	Section	 	Term	 	Section
	Allocation	 	7.5(i)(ii)	 	Releasees
    	 	7.4(a)
	Agreed
    Amount 	 	8.4(b)	 	Releasors
    	 	7.4(a)
	Agreement
    	 	Preamble	 	Reviewed
    Financial Statements	 	5.4
	Allocation	 	7.5(i)(ii)	 	Seller
    Party(ies) 	 	Preamble
	Authorized
    Action 	 	Section
    9.13(c)	 	Seller
    Party Representative 	 	9.13(a)
	Business
    Intellectual Property 	 	5.13(a)	 	Shares
    	 	Recitals
	Buyer
    	 	Preamble	 	Specified
    Entity 	 	4.3(b)
	Claims
    	 	7.4(a)	 	Tax
    Claim Notice 	 	7.5(e)(i)
	Claimed
    Amount 	 	8.4(b)	 	Tax
    Contest 	 	7.5(e)(i)
	Closing
    	 	3.1	 	Top
    Customers 	 	5.25(a)
	Closing
    Date 	 	3.1	 	Top
    Suppliers 	 	5.25(b)
	Code
    Section 338(h)(10) Election	 	7.5(i)(i)	 	Third
    Party Claim 	 	8.4(a)
	Company
    	 	Preamble	 	 	 	 
	Direct
    Claim 	 	8.4(b)	 	 	 	 
	Disclosing
    Party 	 	7.2(b)	 	 	 	 
	Effective
    Time 	 	3.1	 	 	 	 
	Financial
    Statements 	 	5.4	 	 	 	 
	Indemnified
    Party 	 	8.4(a)	 	 	 	 
	Indemnifying
    Party 	 	8.4(a)	 	 	 	 
	Interim
    Financial Statements 	 	5.4	 	 	 	 
	Latest
    Balance Sheet 	 	5.4	 	 	 	 
	Latest
    Balance Sheet Date 	 	5.4	 	 	 	 
	Leased
    Real Property 	 	5.12(b)	 	 	 	 
	Material
    Contracts 	 	5.7(a)	 	 	 	 
	Company
    Licenses 	 	5.10	 	 	 	 
	Most
    Recent Fiscal Year End 	 	5.4	 	 	 	 
	Purchase
    Price 	 	2.2	 	 	 	 


 




    	 



     


    

 





Disclosure
Schedules


 


Schedule
2.2 – Purchase Price Adjustments


 


Schedule
3.2(g)(viii) – Consents, Waivers and Approvals


 


Schedule
4.2(b) – Consents, Waivers and Approvals


 


Schedule
4.3(a) – Schedule of Shareholders


 


Schedule
4.3(b) – Schedule of Investors in Competitive Business


 


Schedule
5.1(a) – Certificate of Good Standing


 


Schedule
5.1(b) – Schedule of Officers, Directors, Managers and Members


 


Schedule
5.2(b) – Consents, Waivers and Approvals


 


Schedule
5.3(a) – Schedule of Authorized Equity Securities and Holders of Confucius Labs


 


Schedule
5.4 – Financial Statements of Confucius Labs


 


Schedule
5.6 – Schedule of Subsequent Events not in the Ordinary Course of Business or Material Adverse Events


 


Schedule
5.7(a) – Schedule of Material Contracts


 


Schedule
5.10 – Schedule of Company Licenses


 


Schedule
5.11(a) – Restricted Rights to Company Assets or Permitted Liens


 


Schedule
5.11(c) – Real and Tangible Personal Property


 


Schedule
5.14 – Tax Compliance, Claims, Disputes or Litigation


 


Schedule
5.16(a) – Business Personnel


 


Schedule
5.16(b) – Business Personnel


 


Schedule
5.18(a) – Employee Benefit Plans


 


Schedule
5.19 – Insurance


 


Schedule
5.20 – Related Party Transaction


 


Schedule
5.22 – Bank Accounts and Authorized Signors, and Outstanding Powers of Attorneys


 





Schedule
5.25(a) – Top Ten Customers


 


Schedule
5.25(b) – Top Ten Vendors