# EDGAR Filing Document

**Accession Number:** 0001463208
**File Stem:** 0001493152-23-003641
**Filing Date:** 2023-2
**Character Count:** 173632
**Document Hash:** 2897c6d51c505e768eb9c1e179d3483c
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001493152-23-003641.hdr.sgml**: 20230206

**ACCESSION NUMBER**: 0001493152-23-003641

**CONFORMED SUBMISSION TYPE**: 8-K

**PUBLIC DOCUMENT COUNT**: 19

**CONFORMED PERIOD OF REPORT**: 20230203

**ITEM INFORMATION**: Completion of Acquisition or Disposition of Assets

**ITEM INFORMATION**: Financial Statements and Exhibits

**FILED AS OF DATE**: 20230206

**DATE AS OF CHANGE**: 20230206

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** Transportation & Logistics Systems, Inc.
- **CENTRAL INDEX KEY:** 0001463208
- **STANDARD INDUSTRIAL CLASSIFICATION:** TRANSPORTATION SERVICES [4700]
- **IRS NUMBER:** 263106763
- **STATE OF INCORPORATION:** NV
- **FISCAL YEAR END:** 1231

**FILING VALUES:**
- **FORM TYPE:** 8-K
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 001-34970
- **FILM NUMBER:** 23588622

**BUSINESS ADDRESS:**
- **STREET 1:** 5500 MILITARY TRAIL
- **STREET 2:** SUITE 22-357
- **CITY:** JUPITER
- **STATE:** FL
- **ZIP:** 33458
- **BUSINESS PHONE:** 1.833.764.1443

**MAIL ADDRESS:**
- **STREET 1:** 5500 MILITARY TRAIL
- **STREET 2:** SUITE 22-357
- **CITY:** JUPITER
- **STATE:** FL
- **ZIP:** 33458

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** PETROTERRA CORP.
- **DATE OF NAME CHANGE:** 20120215

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** LORAN CONNECTION CORP
- **DATE OF NAME CHANGE:** 20090430

?xml version="1.0" encoding="utf-8"?

**UNITED STATES**

**SECURITIES AND EXCHANGE COMMISSION**

**Washington, D.C. 20549**

**FORM 8-K**

**CURRENT REPORT**

**Pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934**

Date of Report (Date of Earliest Event Reported): February 3, 2023

**Transportation and Logistics Systems, Inc.**

(Exact name of registrant as specified in its charter)

---

| | | |
|:---|:---|:---|
| **Nevada** | **001-34970** | **26-3106763** |
| (State or other jurisdiction<br> of incorporation) | (Commission<br> File Number) | (IRS Employer<br> Identification No.) |

---

**5500 Military Trail, Suite 22-357**

**Jupiter, Florida 33458**

(Address of Principal Executive Offices)

**(833) 764-1443**

(Issuer's telephone number)

**Not Applicable**

(Former name or former address, if changed since last report)

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

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

**Securities registered pursuant to Section 12(b) of the Act: None.**

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

Emerging growth company ☐

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

**Forward Looking Statements**

Statements in this report regarding Transportation and Logistics Systems, Inc. (the "**Company**") that are not historical facts are forward-looking statements and are subject to risks and uncertainties that could cause actual future events or results to differ materially from such statements. Any such forward-looking statements, including, but not limited to, financial guidance, are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include all statements that do not directly or exclusively relate to historical facts. In some cases, you can identify forward-looking statements by terms such as "may," "will," "should," "could," "would," "expects," "plans," "anticipates," "intend," "plan," "goal," "seek," "strategy," "future," "likely," "believes," "estimates," "projects," "forecasts," "predicts," "potential," or the negative of those terms, and similar expressions and comparable terminology. These include, but are not limited to, statements relating to future events or our future financial and operating results, plans, objectives, expectations, and intentions. Although we believe that the expectations reflected in these forward-looking statements are reasonable, these expectations may not be achieved. Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they represent our intentions, plans, expectations, assumptions, and beliefs about future events and are subject to known and unknown risks, uncertainties and other factors outside of our control that could cause our actual results, performance or achievement to differ materially from those expressed or implied by these forward-looking statements. In addition to the risks described above, these risks and uncertainties include: our ability to successfully execute our business strategies, including integration of acquisitions and the future acquisition of other businesses to grow our company; customers' cancellation on short notice of master service agreements from which we derive a significant portion of our revenue or our failure to renew such master service agreements on favorable terms or at all; our ability to attract and retain key personnel and skilled labor to meet the requirements of our labor-intensive business or labor difficulties which could have an effect on our ability to bid for and successfully complete contracts; the ultimate geographic spread, duration and severity of the coronavirus outbreak and the effectiveness of actions taken, or actions that may be taken, by governmental authorities to contain the outbreak or ameliorate its effects; our failure to compete effectively in our highly competitive industry could reduce the number of new contracts awarded to us or adversely affect our market share and harm our financial performance; our ability to adopt and master new technologies and adjust certain fixed costs and expenses to adapt to our industry's and customers' evolving demands; our history of losses, deficiency in working capital and stockholders' equity and our ability to achieve sustained profitability; remaining weaknesses in our internal control over financial reporting and our ability to maintain effective controls over financial reporting in the future; our remaining liabilities and indebtedness could adversely affect our business, financial condition and results of operations and our ability to meet our payment obligations; unanticipated and materially adverse developments in our few remaining litigations; the impact of new or changed laws, regulations or other industry standards that could adversely affect our ability to conduct our business; and changes in general market, economic and political conditions in the United States and global economies or financial markets, including those resulting from natural or man-made disasters.

These forward-looking statements represent our estimates and assumptions only as of the date of this report and, except as required by law, we undertake no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise after the date of this report. Given these uncertainties, you should not place undue reliance on these forward-looking statements and should consider various factors, including the risks described, among other places, in our most recent Annual Report on Form 10-K and in our Quarterly Reports on Form 10-Q, as well as any amendments thereto, filed with the Securities and Exchange Commission.

**Item 2.01 Completion of Acquisition or Disposition of Assets.** 

Transportation and Logistics Systems, Inc. (OTC PINK: TLSS) ("TLSS" or the "Company"), a publicly-traded holding company in which its wholly-owned operating subsidiaries, Cougar Express, Inc., Freight Connections, Inc., and JFK Cartage, Inc. together provide a full suite of logistics and transportation services, announced that, on February 3, 2023, its newly-formed wholly-owned subsidiary, TLSS-STI, Inc. ("TLSS-STI"), closed on an acquisition of all outstanding stock of Severance Trucking Co., Inc., Severance Warehousing, Inc. and McGrath Trailer Leasing, Inc., which together, offer LTL trucking services throughout New England (collectively, "Severance"), with an effective date as of the close of business on January 31 2023. The sellers of the stock of each entity were Kathryn Boyd, Clyde Severance, and Robert Severance, all individuals (the "Sellers"). None of the Sellers are affiliated with the Company or its affiliates.

Severance is a privately-owned full-service transportation carrier and logistics business that has been in operation for over 100 years specializing in LTL trucking that provides next day service to major cities in New England and New York, with cartage and interline agreements with respected carriers that ensure reliable deliveries anywhere in the United States and Canada. With annual revenues of over $13.0 million in 2022, Severance currently operates with over 120 power units and trailers and has two locations, comprised of approximately 18,000 square feet of warehouse and cross dock space, 9,000 square feet of office and 5,750 square feet of repair facilities located in Dracut, Massachusetts and approximately 16,000 square feet of warehouse space in North Haven, Connecticut.

The total purchase price was $2,250,000, plus closing expenses of $10,747. TLSS-STI: (i) paid $365,613 in cash at closing; (ii) assumed and paid off $152,748 in vehicle debt; and (iii) entered into a $1,572,939 secured promissory note with the Seller, with interest accruing at the rate of 12% per annum. The entire unpaid principal under the note, shall be due and payable in three (3) equal payments on August 1, 2023, February 1, 2024, and August 1, 2024, respectively, together with all accrued and unpaid interest thereunder, unless paid sooner. The promissory note is secured solely by the assets of Severance and a corporate guaranty from TLSS. The purchase price is subject to a post-closing adjustment, up or down, determined by the amount by which Severance working capital as of the close of business on January 31, 2023, exceeds or falls short of the target working capital, as of September 30, 2022, on which the purchase price was calculated.

One of the Sellers also entered into a consulting agreement, including non-competition and non-solicitation provisions, to continue with Severance after the acquisition for a period of no less than three (3) months and no more than one (1) year.

**Item 9.01 Financial Statements and Exhibits.**

(d) <u>Exhibits</u>

---

| | |
|:---|:---|
| **Exhibit No.** | **Description** |
| 10.1 | [Assignment and Assumption Agreement, dated as of January 31, 2023, between TLSS Acquisition, Inc., a Delaware corporation, and TLSS-STI, Inc., a Delaware corporation.](ex10-1.htm) |
| 10.2+ | [First Amendment to Stock Purchase and Sale Agreement, dated as of February 1, 2023, among TLSS-STI, Inc., a Delaware corporation; Severance Trucking Co., Inc., a Massachusetts corporation, Severance Warehousing, Inc., a Massachusetts corporation, and McGrath Trailer Leasing, Inc., a Maine corporation (collectively, the "Companies"); Kathryn Boyd; Clyde J. Severance; Robert H. Severance, Jr.; Kathryn Boyd, as the Shareholders' Representative; and R\\|A Feingold Law & Consulting, P.A., as Closing Agent and Escrow Agent.](ex10-2.htm) |
| 10.3 | [Secured Promissory Note, dated February 1, 2023, made by TLSS-STI, Inc., a Delaware corporation, Severance Trucking Co., Inc. a Massachusetts corporation, Severance Warehousing, Inc., a Massachusetts corporation and McGrath Trailer Leasing, Inc., a Maine corporation, in favor of Kathryn Boyd, Clyde J. Severance, and Robert H. Severance, Jr.](ex10-3.htm) |
| 10.4 | [Security Agreement, dated as of February 1, 2023, among TLSS-STI, Inc., a Delaware corporation; Severance Trucking Co., Inc., a Massachusetts corporation, Severance Warehousing, Inc., a Massachusetts corporation, and McGrath Trailer Leasing, Inc., a Maine corporation, and Kathryn Boyd, Clyde J. Severance and Robert H. Severance, Jr.](ex10-4.htm) |
| 10.5 | [Absolute, Unconditional and Continuing Guaranty, dated as of February 1, 2023, executed by Transportation and Logistics Systems, Inc., a Nevada corporation, in favor of Kathryn Boyd, Clyde J. Severance, and Robert H. Severance, Jr.](ex10-5.htm) |
| 10.6 | [Consulting Agreement, dated as of February 1, 2023, between Severance Trucking Co., Inc., a Massachusetts corporation, a wholly owned subsidiary of TLSS-STI, Inc., a Delaware corporation, a wholly owned subsidiary of Transportation and Logistics Systems, Inc., a Nevada corporation, and Clyde J. Severance.](ex10-6.htm) |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |

---

+ Disclosure Schedules and other related Schedules are omitted.

**SIGNATURES**

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

---

| | | |
|:---|:---|:---|
| Dated: February 6, 2023 | **TRANSPORTATION AND LOGISTICS SYSTEMS, INC.** | **TRANSPORTATION AND LOGISTICS SYSTEMS, INC.** |
|  | By: | */s/ Sebastian Giordano* |
|  | Name: | Sebastian Giordano |
|  | Title: | Chief Executive Officer |

---

## Exhibit 10.1

**Exhibit 10.1**

**ASSIGNMENT AND ASSUMPTION AGREEMENT** 

THIS ASSIGNMENT AND ASSUMPTION AGREEMENT (this "Assignment and Assumption") is made as of the 31<sup>st</sup> day of January, 2023, by and between TLSS Acquisition, Inc., a Delaware corporation (the "Assignor") and TLSS-STI, Inc., a Delaware corporation (the "Assignee").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A. Assignor has entered into that certain Stock Purchase and Sale Agreement with Severance Trucking Co., Inc., a Massachusetts corporation, Severance Warehousing, Inc., a Massachusetts corporation and McGrath Trailer Leasing, Inc., a Maine corporation (collectively, the "Companies") and Kathryn Boyd, Clyde Severance and Robert Severance, collectively, as the shareholders of the Companies (collectively, the "Shareholders" and hereinafter, collectively, the "Seller"), as well as Kathryn Boyd, as the Shareholders' representative (the "Shareholders' Representative") last dated January 4, 2023, as joined in by R\|A Feingold Law & Consulting, P.A., as closing agent and escrow agent (collectively, the "Agreement") with respect to sale of one hundred (100%) percent of all of the issued and outstanding shares of stock of the Companies (the "Shares").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;B. Assignor desires to assign to Assignee, and Assignee desires to be assigned, all of Assignor's right, title and interest in and to the Agreement.

NOW, THEREFORE, for Ten and No/100 Dollars ($10.00) and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Assignor and Assignee hereby agree as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. Assignor hereby assigns unto Assignee all of Assignor's right, title and interest in the Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2. Assignee hereby accepts the foregoing assignment and assumes and agrees to perform all obligations of Assignor under the Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. This Assignment and Assumption is absolute and is not intended to be a security instrument. Assignor and Assignee each represent and warrant to the other that it has full power and lawful authority to execute and deliver this Assignment and Assumption, and Assignor and Assignee each agree to execute such further instruments as the other may reasonably request to confirm the assignment and assumption of the Agreement as set forth herein.

EXECUTED as of the day and year first above written.

---

| | |
|:---|:---|
| ASSIGNOR: | ASSIGNOR: |
| TLSS Acquisition, Inc., a Delaware corporation | TLSS Acquisition, Inc., a Delaware corporation |
| By: | */s/ Sebastian Giordano* |
|  | Sebastian Giordano, Chief Executive Officer |
| ASSIGNEE: | ASSIGNEE: |
| TLSS-STI, Inc., a Delaware corporation | TLSS-STI, Inc., a Delaware corporation |
| By: | */s/ Sebastian Giordano* |
|  | Sebastian Giordano, Chief Executive Officer |

---

## Exhibit 10.2

**Exhibit 10.2**

**FIRST AMENDMENT TO STOCK PURCHASE AND SALE AGREEMENT** 

THIS FIRST AMENDMENT TO STOCK PURCHASE AND SALE AGREEMENT (this "First Amendment") is dated as of the 1st of February, 2023, by and among TLSS-STI, Inc., a Delaware corporation (the "Buyer"), and Severance Trucking Co., Inc., a Massachusetts corporation, Severance Warehousing, Inc., a Massachusetts corporation and McGrath Trailer Leasing, Inc., a Maine corporation (collectively, the "Companies") and Kathryn Boyd, Clyde J. Severance and Robert H. Severance, Jr., collectively, as the shareholders of the Companies (collectively, the "Shareholders" and hereinafter, collectively, the "Seller"), as well as Kathryn Boyd, as the Shareholders' representative (the "Shareholders' Representative"), as joined in by R\|A Feingold Law & Consulting, P.A., as closing agent and escrow agent (the "Closing Agent" or "Escrow Agent") and Transportation and Logistics Systems, Inc., a Nevada corporation ("TLSS"), in connection with TLSS's agreement to provide a corporate guaranty pursuant to the terms hereof.

W I T N E S S E T H :

WHEREAS, TLSS Acquisition, Inc., a Delaware corporation and a wholly owned subsidiary of TLSS ("TLSSA"), the Companies, the Shareholders, the Shareholders' Representative and the Escrow Agent entered into that certain Stock Purchase and Sale Agreement having an Effective Date of January 4, 2023, as assigned to Buyer pursuant to that Assignment and Assumption Agreement, dated January 31, 2023 by and between Buyer and TLSSA (the "Agreement") with respect to the purchase by Buyer from the Shareholders of one hundred percent (100%) of the issued and outstanding shares of stock of the Companies (the "Shares"); and

WHEREAS, the Buyer, the Shareholders, the Companies and the Shareholders' Representative desire to amend the terms of the Agreement pursuant to the terms set forth herein.

NOW, THEREFORE, in consideration of Ten Dollars ($10.00) and other good and valuable consideration, the receipt, adequacy and sufficiency of which is hereby acknowledged, the parties intending to be legally bound, hereby agree as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. The Agreement as modified by this First Amendment remains in full force and effect. To the extent of any inconsistency between the terms of this First Amendment and the terms of the Agreement, the terms of this First Amendment shall supersede and control to the extent of such inconsistency. Terms not otherwise defined herein shall have the meaning set forth in the Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. Section A of the Recitals shall be deleted in its entirety and replaced with the following:

"A. The Shareholders, are residents of the States of Florida, Massachusetts, or New Hampshire, and collectively own one hundred (100%) percent of all the issued and outstanding shares of capital stock of the Companies (collectively, the "**Shares**"). The Shareholders desire to sell to Buyer, and Buyer desires to purchase from the Shareholders, one hundred percent (100%) of the Shares, on terms and subject to the conditions of this Agreement."

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. Section 1.1(b), of the Section entitled "**<u>PURCHASE AND SALE</u>**", shall be deleted in its entirety and replaced with the following:

"(b) Despite the fact that this "**Transaction**" (as hereinafter defined) is structured as a stock purchase agreement: (i) the following assets shall be excluded from the Transaction and the Shareholders shall be entitled the same: (A) all cash on hand of the Companies as of the close of business on January 31, 2023 (the "**Close of Business**"), which cash shall be distributed to the Shareholders prior to Closing or prior to the Working Capital Delivery Date (defined below), (B) title to or the cash value of life insurance policies, (C) notes receivable, (D) personal vehicles (and the Shareholders shall remain liable for any financing and/or lease payments remaining due thereon), and (E) tax credits and tax refunds for the periods prior to the Close of Business (collectively, the "**Excluded Assets**") and (ii) the following liabilities shall be excluded from the Transaction and the Shareholders shall remain liable for the same: (W) accrued payroll taxes as of the Close of Business, (X) credit line and notes payable to any officers of the Companies, and (Y) financing and/or lease payments remaining due on personal vehicles excluded as assets from the Transaction (collectively, the "**Excluded Liabilities**"). For further clarification, non-Shareholder employee loans receivable by the Companies shall remain an asset of the Companies being acquired by the Buyer."

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4. In Section 1.2, entitled "**<u>CLOSING</u>**", shall be deleted in its entirety and replaced with the following:

"Subject to the terms and conditions of this Agreement, the consummation of the Transaction (the "**Closing**") shall be deemed to occur on February 1, 2023 (the "**Closing Date**"), provided that all conditions set forth in Section 5.1 and Section 5.3 shall have been satisfied or waived by the Party or Parties entitled to the benefits thereof of such conditions. The Companies, the Shareholders and the Buyer, and their respective attorneys need not be physically present at the Closing and may deliver documents by electronic transmission, overnight air courier, or other means, provided, however, originals of documents transmitted by electronic means shall be delivered by overnight air courier after the Closing, if requested by either Party."

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5. Section 1.3, entitled "**<u>CONSIDERATION</u>**", shall be deleted in its entirety and replaced with the following:

"(a) The aggregate consideration to be paid by the Buyer to the Shareholders for all of the Shares of the Companies shall be equal Two Million Two Hundred and Fifty Thousand (US $2,250,000) Dollars (the "**Purchase Price**"), which Purchase Price shall be subject to adjustment pursuant to this Section 1.3 and Section 1.4 hereof (and any Purchase Price adjustments required to be made pursuant to Section 1.4 hereof shall be payable in accordance with Section 1.4(a)(v)), and which Purchase Price shall be payable as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) First, Buyer shall pay-off the vehicle indebtedness in the amount of $152,748.18 (the "**Closing Indebtedness**"). For clarification, credit card expenses and charges associated with business expenses of the Companies and the Companies' equipment leases shall not be deemed Closing Indebtedness for purposes of calculating the Purchase Price, and the amounts due under such equipment leases and the credit cards be assumed by the Buyer. For clarification, personal charges on such credit cards shall be the responsibility of the individual credit card holders;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Buyer will deliver to the Shareholders, a secured promissory note, payable by the Buyer and Companies after giving effect to the transactions contemplated hereby, in the principal amount of One Million Five Hundred Seventy Two Thousand Nine Hundred Thirty Eight and 86/100 ($1,572,938.86) Dollars (the "**Note**"), the form of which is attached hereto as **<u>Exhibit A</u>**. Such Note shall be secured by a certain security agreement, the form of which is attached hereto as **<u>Exhibit B</u>** (the "**Security Agreement**"), UCC-1 financing statements (the "**UCC-1**") and a certain corporate guaranty from TLSS, the form of which is attached hereto as **<u>Exhibit C</u>** (the "**Guaranty**"). As more particularly set forth in the Note and in Sections 1.3(a)(ii), 1.4(a)(v), 7.2, 7.5, and 9.12 of this Agreement, Buyer shall have the right to set-off against amounts due under the Note: (i) Losses with respect to the Shareholders' indemnification obligations pursuant to Sections 7.2, 7.5, and 9.12, (ii) the amount of any "**Purchase Price Surplus**" (as hereinafter defined) pursuant to Section 1.4 hereof, and (iii) any amounts guaranteed by the Companies to the lender who has provided a mortgage loan to the Severance Family Realty Trust, under Declaration of Trust dated January 26, 1998, as amended (the "Family Trust"), which Family Trust owns the "McGrath Premises" (as hereinafter defined) in the event that the Family Trust defaults on such mortgage loan and any of the Companies, as guarantors, receive a demand from such lender to pay the mortgage loan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) The balance of the Purchase Price in the amount of Five Hundred Twenty Four Thousand Three Hundred Twelve and 96/100 ($524,312.96) Dollars, shall be paid by Buyer to the Shareholders in cash, by wire in immediately available funds less certain legal and accounting expenses incurred by the Companies and the Shareholders in connection with the Transaction.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) The Parties hereby agree to the following purchase price allocation (the "**Purchase Price Allocation**"): (A) $1,000 shall be allocated to the purchase of the shares of SWI, (B) $46,979 shall be allocated to the purchase of the shares of MTLI. and (c) the remainder of the purchase price shall be allocated to the purchase of the shares of STI."

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6. Section 1.4, entitled "**<u>PURCHASE PRICE ADJUSTMENT</u>**", shall be deleted in its entirety and replaced with the following:

"(a) The Parties agree that the Purchase Price is to be calculated based on the Companies having working capital equal to the average of the sum of the total consolidated current accounts receivable of the Companies, minus the sum of the total consolidated current accounts payable of the Companies, for the trailing twelve month period prior to the Close of Business (the "**Working Capital**"). Notwithstanding the foregoing, as the accounting to accurately determine the Working Capital as of the Close of Business will not be available until after the Closing, the Parties agree to do the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) prior to the Closing, the Parties shall establish (A) a calculation of working capital equal to the average of the sum of the total consolidated current accounts receivable of the Companies, minus the sum of the total consolidated current accounts payable of the Companies, for the trailing twelve (12) month period from September 30, 2021 to September 30, 2022, which shall be calculated using the Working Capital Methodologies (as defined herein) (the "**Target Working Capital**");

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) on or before ninety (90) days after the Closing (the "**Working Capital Delivery Date**"), Buyer shall prepare in good faith and deliver to the Shareholders' Representative a certificate (the "**Purchase Price Adjustment Certificate**") executed by an executive officer of Buyer setting forth in reasonable detail, the Working Capital as of the Close of Business (the "**Closing Working Capital**"), and Buyer's calculation of the Purchase Price adjustment based on the difference between the Closing Working Capital and the Target Working Capital (the "**Purchase Price Adjustment**"). If Buyer does not deliver the Purchase Price Adjustment Certificate on or before the Working Capital Delivery Date, the Target Working Capital shall be deemed to be the Closing Working Capital, unless Buyer notifies the Shareholders' Representative, in writing, prior to the Working Capital Delivery Date, that additional time is required to prepare the Purchase Price Adjustment Certificate due to the unavailability of certain information from the Shareholders' Representative for a period of time prior to the Closing Date, and such written notice identifies the necessary information to complete the Purchase Price Adjustment Certificate. The Closing Working Capital shall be calculated using the Working Capital Methodologies (defined below). Simultaneously with the delivery of the Purchase Price Adjustment Certificate, Buyer shall provide to the Shareholders' Representative all work papers and other information reasonably required by the Shareholders' Representative to evaluate such calculations, and shall provide the Shareholders' Representative with reasonable access to Buyer's financial personnel who were responsible for the preparation of the same in order for the Shareholders' Representative to discuss and evaluate such calculations, work papers and information. The Shareholders' Representative shall have thirty (30) days after receipt by the Shareholders' Representative of the Purchase Price Adjustment Certificate to accept or object to the Closing Working Capital calculation. If the Shareholders' Representative does not timely object to the Closing Working Capital calculation within such thirty (30) day period, the Closing Working Capital calculation shall be deemed accepted;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) If the Shareholders' Representative delivers written notice to Buyer within thirty (30) days after receipt by the Shareholders' Representative of the Purchase Price Adjustment Certificate stating that the Shareholders object to the Closing Working Capital calculation, the Parties shall submit the issues remaining in dispute to their respective accountants to resolve. In the event that the accountants cannot resolve, each accountant will submit a list of five (5) independent accountants to resolve this matter. The first names that match on the lists shall be appointed to resolve the issues remaining in dispute (the "**Independent Accountants**") for resolution of the dispute, which Independent Accountants shall have not represented or been engaged by Buyer or the Shareholders prior to the submission of the dispute, and the Parties hereby agree that neither shall be permitted to engage such Independent Accountants for a period of five (5) years after the date of the submission of the dispute. If issues are submitted to the Independent Accountants for resolution, (A) the Independent Accountants shall use the Working Capital Methodologies; (B) each Party shall furnish or cause to be furnished to the Independent Accountants such work papers and other documents and information relating to the disputed issues as the Independent Accountants may request and are available to that Party and shall be afforded the opportunity to present to the Independent Accountants any material relating to the disputed issues and to discuss the issues with the Independent Accountants; and (C) the determination by the Independent Accountants, as set forth in a notice to be delivered by the Independent Accountants to the Shareholders and Buyer within thirty (30) days after the submission to the Independent Accountants of the issues remaining in dispute, shall be final, binding and conclusive on the Parties;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) the fees and expenses of the Independent Accountants will be paid by Shareholders, on the one hand, and Buyer, on the other hand, based upon the percentage that the amount actually contested but not awarded to the Shareholders or Buyer, respectively, bears to the aggregate amount actually contested by the Shareholders and Buyer; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) Within ten (10) business days after the Purchase Price Adjustment is finally determined (A) in the event that the Closing Working Capital is greater than the Target Working Capital, the Buyer shall pay to the Shareholders by wire transfer of immediately available funds to accounts designated by the Shareholders' Representative the difference between the Closing Working Capital and the Target Working Capital; and (B) In the event that the Closing Working Capital is less than the Target Working Capital, Buyer shall set-off against the next amounts due to the Shareholders under Note, an amount equal to the difference between the Closing Working Capital and the Target Working Capital (the "**Purchase Price Surplus**").

(d) The Purchase Price Allocation shall be adjusted based on the Purchase Price Adjustment by reducing or increasing the amount of the Purchase Price allocated to STI.

(e) The Closing Working Capital shall be calculated consistent with past practice used to calculate the Target Working Capital and the following methodologies (the "**Working Capital Methodologies**"): (A) amounts charged on credit cards for business expenses associated with the Companies are ordinary business expenses and shall be included in accounts payable for all purposes, (B) the Excluded Assets, the Indebtedness, and the Accruals (defined below) shall be excluded from the calculations of Working Capital, and (C) insurance that has been prepaid by the Companies for periods commencing February 1, 2023, the security deposit for the North Haven Lease, and tax credits and refunds for periods ending prior to the Closing shall be excluded from the calculation of Working Capital.

(f) The provisions of this Section 1.4 shall survive Closing."

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7. Section 1.5, entitled "**<u>DUE DILIGENCE PERIOD</u>**", subsection (b) shall be amended by deleting "January 25, 2023" and replacing the same with "January 27, 2023".

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8. Section 1.6, entitled "**<u>FINANCING CONTINGENCY</u>**", shall be deleted in its entirety.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9. Section 2.2, entitled "**<u>AUTHORIZATION; NON-CONTRAVENTION; APPROVALS</u>**", shall be amended by deleting "Except as provided in <u>Schedule 2.2</u>, the" and replacing the same with "The".

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10. Section 2.3, entitled "**<u>INSOLVENCY</u>**", shall be amended by deleting "Except as provided in <u>Schedule 2.3</u>, there" and replacing the same with "There".

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11. Article III entitled "**REPRESENTATION AND WARRANTIES OF THE COMPANIES AND THE SHAREHOLDERS**" shall be amended as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Section 3.1 (d) shall be deleted in its entirety and replaced with the following:

"<u>Schedule 3.1(d)</u> contains a list of all jurisdictions in which the Companies are authorized or qualified to do business as of the Schedule Delivery Date. Except as set forth on <u>Schedule 3.1(d)</u> true, complete and correct copies of the Charter Documents, including, but not limited to the articles of incorporation of the Companies, and all amendments, as well as the bylaws of the Companies, and all amendments, have been made available to the Buyer or will be uploaded to the Data Room prior to Schedule Delivery Date."

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Section 3.5 shall be amended by replacing all references to "the Companies" with "STI".

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Section 3.8(a) shall be amended by deleting "the Material Vehicle Repairs and" in its entirety.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) The second sentence of Section 3.10 shall be deleted in its entirety and replaced with "Copies of such licenses, franchises, permits, and other governmental authorizations in the Companies possession will be uploaded to the Data Room prior to the Schedule Delivery Date."

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) The second sentence of Section 3.13 shall be deleted in its entirety and replaced with "Except as set forth on <u>Schedule 3.13(e)</u>, the Companies have made available to the Buyer true, complete and correct copies of all of the Companies' insurance policies currently in effect, which have been uploaded to the Data Room prior to the Schedule Delivery Date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) Section 3.17, entitled "**<u>TAXES</u>**", shall be amended as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Subsection (a) shall be amended by deleting "the Closing Date" and "Closing" and replacing the same with "January 31, 2023".

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) The second sentence of Subsection (a) shall be amended by deleting "The" at the beginning of the sentence and replacing the same with "Except as set forth on <u>Schedule 3.17</u>".

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) Subsection (b) shall be amended by deleting "prior to the Closing Date" and replacing the same with "on or prior to January 31, 2023".

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12. Section 4.1, entitled "**<u>CONDUCT OF THE PARTIES</u>**", subsection (a)(v)(VI) shall be amended by deleting ", dated within thirty (30) days of the Closing Date" and replacing the same with "based on the last required annual report".

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13. Section 5.2, entitled "**<u>CLOSING DELIVERIES OF THE COMPANIES AND THE SHAREHOLDERS</u>**", shall be amended as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Subsection (b) shall be amended by deleted in its entirety and replaced with the following: "(b) a counterpart signature page to the consulting agreement, dated as of the Closing Date, between STCI and Clyde Severance (the "CS Consulting Agreement") shall be signed by Clyde Severance";

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Subsection (c) shall be deleted in its entirety and replaced with "Intentionally Deleted";

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Subsection (d) shall amended by adding the following after the term "Transaction Documents": ", provided, however, no good standing certificates shall be required to be provided with respect to states where such entities have filed for authority to do business less than thirty (30) days prior to the Closing Date";

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Subsection (g) shall be deleted in its entirety and replaced with "Intentionally Deleted";

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) Subsection (h) shall be deleted in its entirety and replaced with "Intentionally Deleted";

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) Subsection (i) shall be deleted in its entirety and replaced with "Intentionally Deleted";

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) Subsection (k) shall be deleted in its entirety and replaced with "proof satisfactory to Buyer that any and all liens (including but not limited to, filed UCC-1 financing statements) on the assets of the Companies have been terminated and released, except with respect to (i) equipment leases assumed by Buyer, (ii) liens that will be released in connection with the payment of the Closing Indebtedness, and (iii) Permitted Encumbrances."

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) Subsection (o) shall be deleted in its entirety and replaced with "Intentionally Deleted".

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14. Section 5.3, entitled "**<u>CONDITIONS PRECEDENT TO OBLIGATIONS OF THE BUYER</u>**" shall be amended as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Delete subsection (d) in its entirety and replacing the same with the following: "(d) Intentionally deleted."; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Subsection (f)(ii) shall be deleted in its entirety and replaced with "Intentionally Deleted".

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;15. Section 5.4, entitled "**<u>CLOSING DELIVERIES OF THE BUYER</u>**" shall be amended as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Subsection (b) shall be amended by deleting "evidence of the assumption or" and replacing the same with "the";

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Subsection (d) shall be amended by adding the following after the term "Transaction Documents": ", provided, however, no good standing certificate shall be required to be provided by the Buyer if such entity was formed less than thirty (30) days prior to the Closing Date";

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Subsection (g) shall be amended by deleting "CS Employment Agreement" and replacing the same with "CS Consulting Agreement";

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Subsection (h) shall be deleted in its entirety and replaced with "Intentionally Deleted;"; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) Subsection (k) shall be deleted in its entirety and replaced with "Intentionally Deleted; and".

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;16. Section 6.1, entitled "**<u>AFFIRMATIVE COVENANTS</u>**", subsection (b) is hereby amended to delete the following on the third and fourth lines: "including obtaining Financing required to satisfy the financing condition specified in Section 5.3(d) above,".

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;17. Section 6.2, entitled "**<u>FULL ACCESS; DELIVERABLES</u>**", subsection (c) shall be deleted in its entirety.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;18. Section 6.5, entitled "**<u>FURTHER ASSURANCES; COOPERATION; NOTIFICATION</u>**" shall be amended by deleting subsection (c) and replacing the same with "Intentionally Deleted".

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;19. Section 7.2, entitled, "**<u>INDEMNIFICATION BY SHAREHOLDERS</u>**", the second paragraph shall be deleted in its entirety and replaced with the following:

"In order to secure certain of the Shareholders' indemnification obligations hereunder, if Buyer is not then in breach of its representations, warranties, or obligations under this Agreement, Buyer shall have the right for a period of twelve (12) months after Closing (the "**Indemnification Escrow Period**"), to set-off from the Note up to One Hundred Thousand Dollars ($100,000) due to the Shareholders under the Note as a source of payment for Buyer's indemnification claims for Losses made during the Indemnification Escrow Period. In the event an indemnification claim for Losses is timely made, the Losses set-off against the amounts due under the Note shall be wired by the Buyer to the Escrow Agent and such amount shall be held in escrow (the "**Indemnification Escrow**") pursuant to Section 9.12. In the event an indemnification payment is due to the Buyer pursuant to Section 7.5 below, then the Indemnification Escrow shall be released in accordance with Section 9.12."

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;20. Section 7.6, entitled "**<u>CERTAIN INDEMNIFICATION LIMITS</u>**", subsection (a) shall be amended by adding the following after the term "Purchase Price,": "plus the original principal balance of the Note,".

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;21. Article VIII, entitled "**<u>LIMITATIONS ON COMPETITION</u>**", shall be amended by adding the following as Section 8.6:

"**SECTION 8.6 <u>SURVIVAL</u>**.

The provisions of this Article VIII shall survive Closing."

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;22. Section 9.3, entitled "**<u>SUCCESSORS AND ASSIGNS</u>**", shall be amended by deleting the word "it's" in the second sentence and replacing the same with "its".

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;23. Section 9.12, entitled "**<u>ESCROW; ESCROW AGENT</u>**", shall be amended as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Subsection (a) shall be deleted in its entirety and replaced with the following:

"(a) The Closing Agent shall act as escrow agent (the "**Escrow Agent**") in connection with the Indemnification Escrow. The amounts in the Indemnification Escrow (the "**Escrow Funds**") shall be held in a non-interest bearing Federal Deposit Insurance Corporation trust account separate and distinct from the Escrow Agent's operating accounts (the "**Escrow Account**")."

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Subsection (b) shall be deleted in its entirety and replaced with "Intentionally Deleted."

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Subsection (c) shall be deleted in its entirety and replaced with the following:

"(c) If during the Indemnification Escrow Period, Buyer desires to make a claim on the Indemnification Escrow pursuant to Sections 7.2 and 7.5, it shall either deliver to the Escrow Agent joint written instructions duly executed by the Buyer and the Shareholders' Representative or a final, non-appealable determination of a court of competent jurisdiction directing the release from the Indemnification Escrow the amounts set forth in the joint written instructions or the determination. Within the five (5) days following the end of the Indemnification Escrow Period, the Shareholders' Representative shall request the release of remaining Escrow Funds by providing written notice to the Escrow Agent and the Buyer, and the Escrow Agent shall release the then remaining Escrow Funds to the Shareholders pursuant to wire instructions delivered by the Shareholders' Representative, provided the Buyer has not objected, in writing, to the release of the Escrow Funds during the Indemnification Escrow Period, which objection shall identify the basis for such objection and the amount in dispute, and in such event all remaining amounts of the Escrow Funds, other than such amounts in dispute, shall be released from the Indemnification Escrow. The amounts in the Indemnification Escrow subject to Buyer's objection shall be held by the Escrow Agent until it receives joint written instructions duly executed by the Buyer and the Shareholders' Representative or a final, non-appealable determination of a court of competent jurisdiction directing the release of such funds."

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;24. Article IX, entitled "MISCELLANEOUS", shall be amended by adding the following as Section 9.15:

"**SECTION 9.15 <u>TAX COVENANTS</u>**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) **IN THE CASE OF ANY TAX PERIOD THAT BEGINS BEFORE AND ENDS AFTER JANUARY 31, 2023 (A "<u>STRADDLE PERIOD</u>"), THE AMOUNT OF ANY TAXES OF THE COMPANIES FOR THE PERIOD ON OR PRIOR TO JANUARY 31, 2023 SHALL BE DETERMINED BASED ON AN INTERIM CLOSING OF THE BOOKS AS OF JANUARY 31, 2023.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) **THE SHAREHOLDERS SHALL PREPARE, OR CAUSE TO BE PREPARED, ALL TAX RETURNS OF THE COMPANIES FOR ANY TAXABLE PERIODS ENDING ON OR BEFORE JANUARY 31, 2023 THAT ARE DUE AFTER THE CLOSING DATE.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) **BUYER SHALL TIMELY PREPARE, OR CAUSE THE COMPANIES TO TIMELY PREPARE, AND FILE, OR CAUSE THE COMPANIES TO FILE, ALL TAX RETURNS WHICH INCLUDE OR PERTAIN TO A STRADDLE PERIOD. IN THE EVENT ANY SUCH STRADDLE PERIOD TAX RETURN SHALL BE PREPARED IN A MANNER INCONSISTENT WITH PAST PRACTICE OR INVOLVE CHANGES TO ANY ELECTION OR ANY ACCOUNTING METHOD, THEN IF SUCH NEW MANNER OF PREPARING THE TAX RETURN FOR SUCH STRADDLE PERIOD OR IF SUCH CHANGES FOR THE STRADDLE PERIOD RESULT IN AN INCREASED TAX LIABILITY TO THE SHAREHOLDERS COMPARED TO THE TAX LIABILITY THE SHAREHOLDERS WOULD HAVE BEEN RESPONSIBLE FOR HAD THE STRADDLE PERIOD TAX RETURN BEEN PREPARED IN A MANNER CONSISTENT WITH PAST PRACTICE AND DID NOT INVOLVE ANY CHANGES TO ANY ELECTION OR ANY ACCOUNTING METHOD, THEN THE BUYER HEREBY AGREES TO INDEMNIFY THE SHAREHOLDERS FOR SUCH INCREASED TAX LIABILITY. BUYER SHALL SUBMIT SUCH STRADDLE PERIOD TAX RETURNS TO THE SHAREHOLDERS' REPRESENTATIVE AT LEAST 30 DAYS PRIOR TO THE DUE DATE (INCLUDING EXTENSIONS) OF ANY SUCH STRADDLE PERIOD TAX RETURN. IF THE SHAREHOLDERS' REPRESENTATIVE OBJECTS TO ANY ITEM ON ANY STRADDLE PERIOD TAX RETURN, SHE SHALL, WITHIN 10 DAYS AFTER DELIVERY OF SUCH STRADDLE PERIOD TAX RETURN, NOTIFY BUYER IN WRITING THAT SHE SO OBJECTS. IF A NOTICE OF OBJECTION SHALL BE DULY DELIVERED, BUYER AND THE SHAREHOLDERS' REPRESENTATIVE SHALL NEGOTIATE IN GOOD FAITH AND USE THEIR REASONABLE BEST EFFORTS TO RESOLVE SUCH ITEMS. IF BUYER AND THE SHAREHOLDERS' REPRESENTATIVE ARE UNABLE TO REACH SUCH AGREEMENT WITHIN 10 DAYS AFTER RECEIPT BY BUYER OF SUCH NOTICE, THE DISPUTED ITEMS SHALL BE RESOLVED BY THE INDEPENDENT ACCOUNTANTS APPOINTED UNDER PROCEDURES SIMILAR TO THOSE IN SECTION 1.4(A)(III) AND ANY DETERMINATION BY THE INDEPENDENT ACCOUNTING FIRM SHALL BE FINAL. THE COSTS, FEES AND EXPENSES OF THE INDEPENDENT ACCOUNTANTS WITH RESPECT TO A STRADDLE PERIOD TAX RETURN SHALL BE BORNE EQUALLY BY BUYER AND THE SHAREHOLDERS.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) **THE SHAREHOLDERS SHALL BE RESPONSIBLE FOR ANY TAX LIABILITY FOR THE PERIOD PRIOR TO AND INCLUDING JANUARY 31, 2023 AND THE BUYER SHALL BE RESPONSIBLE FOR THE TAX LIABILITY ACCRUING AFTER JANUARY 31, 2023, SUBJECT TO THE SHAREHOLDERS' RIGHT TO INDEMNIFICATION SET FORTH IN SECTION 9.15(C) ABOVE. FURTHERMORE, AN AUDIT MAY BE REQUIRED TO BE CONDUCTED POST-CLOSING FOR THE PERIOD ON OR PRIOR TO JANUARY 31, 2023 AT THE BUYER'S SOLE COST, INCLUDING ANY FEES OF KATHLEEN BRUSSEAU, CPA. THE SHAREHOLDERS AND THE COMPANIES HEREBY AGREE TO COOPERATE WITH THE BUYER'S REASONABLE REQUESTS IN CONNECTION WITH MAKING THE COMPANIES' BOOKS AND RECORDS AVAILABLE TO THE BUYER FOR SUCH POST-CLOSING AUDIT. THE PROVISIONS OF THIS SECTION 9.15 SHALL SURVIVE CLOSING."** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;25. Notwithstanding anything contained herein or in the Agreement to the contrary, the Parties hereby agree as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) With respect to corporate credit cards used in connection with operation of the business of the Companies, and which credit cards are personally guaranteed by one or more of the Shareholders, the Companies and the Shareholders hereby agree that the Companies may continue to use such credit cards for a period of thirty (30) days after the Closing Date and shall terminate the credit cards prior to the end of such 30-day period. The Companies, after giving effect to the transactions contemplated hereby and the Buyer hereby agree to indemnify, defend and hold the Shareholders harmless for all amounts charged on such credit cards after January 31, 2023.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The personal vehicle of Clyde Severance, which shall be distributed to Clyde Severance on or prior to January 31, 2023, may be re-registered in the name of Clyde Severance after the Closing Date and the Buyer shall cooperate in connection with Clyde Severance's re-registration efforts.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) With respect to the North Haven Premises, the North Haven Landlord has required that certain work be completed at the North Haven Premises by the Companies in connection with the North Haven Landlord entering into a new lease for the North Haven Premises effective February 1, 2023 and the Shareholders have agreed to cause such work to be completed, at the Shareholders' sole cost and expense no later than ninety (90) days after the Closing Date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) The accrued but unpaid payroll and payroll taxes as of the Close of Business, medical claims for the Companies' self-funded heath insurance as of the Close of Business, and taxes of the Companies as of December 31, 2022 (collectively, the "**Accruals**") will not be determined and/or paid until after the Closing. Accordingly, the Shareholders shall permit certain cash to remain in the accounts of the Companies as of the Close of Business (the "**Shareholders Cash**") to pay the Accruals. Prior to the Working Capital Delivery Date, Buyer shall deliver to the Shareholders' Representative an accounting of the Accruals and pay to the Shareholders the remaining Shareholders Cash after payment of the Accruals. In addition, insurance that has been prepaid by the Companies for periods commencing February 1, 2023 will not be determined prior to the Closing and the security deposit for the North Haven Lease, and tax credits and refunds for periods ending prior to the Closing will not be paid to the Companies until after Closing. Buyer shall pay and deliver such prepaid insurance, security deposit, and tax credit and refund amounts to the Shareholders immediately upon receipt.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;26. Buyer and, and after giving effect to the Transaction, the Companies shall not, directly or indirectly, take any action that would have the purpose of avoiding any payments required to be paid to the Shareholders under the Note.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;27. A complete set of the Disclosure Schedules referenced in the Agreement, as may be supplemented or amended prior to Closing, are attached hereto and made a part hereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;28. This First Amendment may be executed in any number of counterparts, each of which, when executed, shall be deemed an original and all of which shall be deemed one and the same instrument. Transmission of signatures electronically via DocuSign (or like service), via facsimile or via an e-mail of a signed .pdf of this First Amendment shall be deemed to be original signatures.

[*Signature Page Follows*]

IN WITNESS WHEREOF, the parties have executed this First Amendment as of the day and year first above written.

---

| | |
|:---|:---|
| BUYER: | BUYER: |
| TLSS-STI, INC., a Delaware corporation | TLSS-STI, INC., a Delaware corporation |
| By: | */s/ Sebastian Giordano* |
| Name: | Sebastian Giordano |
| Title: | Chief Executive Officer |
| TLSS: | TLSS: |
| TRANSPORTATION AND LOGISTICS SYSTEMS, INC., a Nevada corporation | TRANSPORTATION AND LOGISTICS SYSTEMS, INC., a Nevada corporation |
| By: | */s/ Sebastian Giordano* |
| Name: | Sebastian Giordano |
| Title: | Chief Executive Officer |
| ESCROW AGENT: | ESCROW AGENT: |
| R A Feingold Law & Consulting, P.A. | R A Feingold Law & Consulting, P.A. |
| By: | */s/ Robert A. Feingold* |
| Name: | Robert A. Feingold, Esq. |
| Title: | President |

---

---

| | |
|:---|:---|
| COMPANIES: | COMPANIES: |
| SEVERANCE TRUCKING CO., INC., a | SEVERANCE TRUCKING CO., INC., a |
| Massachusetts corporation | Massachusetts corporation |
| By: | */s/ Kathryn Boyd* |
| Name: | Kathryn Boyd |
| Title: | President |
| SEVERANCE WAREHOUSING, INC., a | SEVERANCE WAREHOUSING, INC., a |
| Massachusetts corporation | Massachusetts corporation |
| By: | */s/ Kathryn Boyd* |
| Name: | Kathryn Boyd |
| Title: | President |
| MCGRATH TRAILER LEASING, INC., a | MCGRATH TRAILER LEASING, INC., a |
| Maine corporation | Maine corporation |
| By: | */s/ Kathryn Boyd* |
| Name: | Kathryn Boyd |
| Title: | President |

---

---

| | |
|:---|:---|
| SHAREHOLDERS: | SHAREHOLDERS: |
| */s/ Kathryn Boyd* | */s/ Kathryn Boyd* |
| Name: | Kathryn Boyd |
| */s/ Clyde J. Severance* | */s/ Clyde J. Severance* |
| Name: | Clyde J. Severance |
| */s/ Robert H. Severance, Jr.* | */s/ Robert H. Severance, Jr.* |
| Name: | Robert H. Severance, Jr. |
| SHAREHOLDERS' REPRESENTATIVE: | SHAREHOLDERS' REPRESENTATIVE: |
| */s/ Kathryn Boyd* | */s/ Kathryn Boyd* |
| Name: | Kathryn Boyd |

---

**<u>Exhibit A</u>**

**<u>SECURED PROMISSORY NOTE</u>**

See attached

**<u>Exhibit B</u>**

**<u>SECURITY AGREEMENT</u>**

See attached

**<u>Exhibit C</u>**

**<u>GUARANTY</u>**

See attached

**<u>Schedules</u>**

## Exhibit 10.3

**Exhibit 10.3**

**THIS LOAN IS PAYABLE IN FULL AT MATURITY. THE UNDERSIGNED MUST REPAY THE ENTIRE PRINCIPAL BALANCE OF THE LOAN AND UNPAID INTEREST THEN DUE. THE LENDER IS UNDER NO OBLIGATION TO REFINANCE THE LOAN AT THAT TIME. THE UNDERSIGNED WILL THEREFORE BE REQUIRED TO MAKE PAYMENT OUT OF OTHER ASSETS THAT THE UNDERSIGNED MAY OWN, OR THE UNDERSIGNED WILL HAVE TO FIND A LENDER WILLING TO LEND THE UNDERSIGNED THE MONEY.**

**SECURED PROMISSORY NOTE**

---

| | |
|:---|:---|
| **$1572938.86** | **February 1, 2023** |

---

FOR VALUE RECEIVED, the undersigned, TLSS-STI, Inc., a Delaware corporation, Severance Trucking Co., Inc. a Massachusetts corporation, Severance Warehousing, Inc., a Massachusetts corporation and McGrath Trailer Leasing, Inc., a Maine corporation (individually, a "Maker" and collectively, the "Makers"), jointly and severally promise to pay to the order of each of Kathryn Boyd, Clyde J. Severance, and Robert H. Severance, Jr. (each, a "Shareholder", and collectively, the "Shareholders" or the "Lender") at the addresses designated by each Shareholder or at such other place as a Shareholder may from time to time designate by written notice to a Maker, in lawful money of the United States of America, the collective sum of One Million Five Hundred Seventy-Two Thousand Nine Hundred Thirty-Eight and 86/100 Dollars ($1,572,938.86) (the "Principal Amount"), together with accrued and unpaid interest thereon. The Principal Amount and interest thereon is to be paid without setoff or counterclaim other than as expressly provided for in this Secured Promissory Note (the "Note"). Makers further agree as follows:

<u>Section 1</u>. <u>Interest Rate</u>.

Interest shall accrue at a rate of twelve (12%) percent per annum, commencing as of February 1, 2023 (the "Interest Rate"). Interest shall be computed on the basis of a 365 day calendar year.

<u>Section 2</u>. <u>Payments</u>. Principal and interest shall be allocated equally among the Shareholders payable to each Shareholder as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) On the 1<sup>st</sup> day of August, 2023 accrued interest on the outstanding Principal Amount of this Note, at the Interest Rate, and one-third of the original Principal Amount shall be due and payable by the undersigned to the Shareholders (the "First Payment Date"). On the 1<sup>st</sup> day of February, 2024 accrued interest on the outstanding balance of Principal Amount of this Note, at the Interest Rate, and one-third of the original Principal Amount shall be due and payable by the undersigned to the Shareholders (the "Second Payment Date"). On the 1<sup>st</sup> day of August, 2024 accrued interest on the outstanding Principal Amount of this Note, at the Initial Interest Rate, and the entire unpaid balance of the Principal Amount shall be due and payable by the undersigned to the Shareholders (the "Third Payment Date" or the "Maturity Date"), unless paid sooner pursuant to Section 2(b) below.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Makers shall have the right to prepay this Note in full or in part at any time, without premium or penalty. All prepayments shall be applied first to accrued interest and then to the balance of the Principal Amount.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Notwithstanding anything contained herein to the contrary, the Buyer shall have the right to set-off from this Note solely in accordance with Sections 1.3(a)(ii), 1.4, 7.2, 7.5, and 9.12 of the Stock Purchase and Sale Agreement by and between the TLSS-STI, Inc., a Delaware corporation (the "Buyer"), Severance Trucking Co., Inc., a Massachusetts corporation, Severance Warehousing, Inc., a Massachusetts corporation, and McGrath Trailer Leasing, Inc., a Maine corporation, as owned by the Shareholders, (collectively, the "Companies"), the Shareholders, the Shareholders' Representative and as joined by R\|A Feingold Law & Consulting, P.A., as closing agent and escrow agent, dated as of January 4, 2023, as assigned and amended (the "SPA").

<u>Section 3</u>. <u>Security</u>.

The obligations of Makers hereunder are secured by a first priority security interest in the collateral of each Maker pursuant to the Security Agreement dated as of the date hereof (the "Security Agreement") and the filing of UCC-1 Financing Statements to be filed with such offices as Lender deems appropriate to perfect Lender's security interest in the collateral. In addition, the obligations of the Makers hereunder shall be secured by a corporate guaranty of Transportation and Logistics Systems, Inc., a Nevada corporation ("TLSS"), the sole shareholder of the Buyer.

<u>Section 4</u>. <u>Default</u>.

It shall be an event of default ("Event of Default") and any Shareholder may exercise any right, power or remedy permitted by law, in the Security Agreement, or as set forth herein, including without limitation, the right to declare the entire unpaid Principal Amount of this Note, together with accrued interest hereon and all other sums due hereunder, to be immediately due and payable, upon the occurrence of any of the following events and all amounts shall bear interest until paid in full at the rate of eighteen (18%) per annum:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Any failure on the part of a Maker to make any payment when due, whether by acceleration or otherwise, and the continuation of such failure for a period of five (5) days after the due date;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) A Maker shall commence any proceeding under any bankruptcy, reorganization, arrangement, readjustment of debt, moratorium or similar law or statute;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) A proceeding shall be commenced against a Maker under any bankruptcy, reorganization, arrangement, readjustment of debt, moratorium or similar law or statute, but is not dismissed within ninety (90) days after the commencement thereof;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) A Maker consents to or suffers the appointment of a guardian, receiver, trustee or custodian to any substantial and material part of its assets that is not vacated within ninety (90) days;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (e) The insolvency, dissolution, restructuring, or change in ownership of any Maker; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) A default under the Security Agreement, after the expiration of all applicable grace, notice and cure periods thereunder.

In addition, upon an Event of Default, after the expiration of all applicable grace, notice and cure periods, Makers shall pay to the Lender all reasonable attorneys' fees, out-of-pocket expenses, costs and other expenses incurred in connection with collecting and/or enforcing payment thereof, which amounts shall bear interest until paid in full at the rate of eighteen (18%) percent per annum. Lender's rights hereunder or under applicable law shall be cumulative.

<u>Section 5</u>. <u>Late Charge</u>.

In the event that any payment of the Principal Amount or interest required to be made by a Maker under this Note shall not be received by Lender within ten (10) days after its due date, Makers shall pay to Lender, on demand, a late charge of five percent (5%) of such delinquent payment. The foregoing right is in addition to, and not in limitation of, any other rights which Lender may have upon a Maker's failure to make timely payment of any amount due hereunder.

<u>Section 6</u>. <u>Waivers</u>.

Makers waive demand, presentment, protest, notice of protest, notice of dishonor, and all other notices (other than those specifically required hereby) or demands of any kind or nature with respect to this Note. Each Maker expressly consents to any extensions and renewals, in whole or in part, to the release of any collateral security or portions thereof, given to secure this Note, and all delays in time of payment or other performance which Lender may grant, in its sole discretion, at any time and from time to time without limitation, all without any notice or further consent of any Maker and any such grant by Lender shall not be deemed a waiver of any subsequent delay or any of Lender's rights hereunder.

<u>Section 7</u>. <u>Usury</u>.

In no event shall this or any other provision herein, permit the collection of any interest that would be usurious under the law governing this transaction. If any such interest in excess of the maximum rate allowable under applicable law has been collected, Makers agree that the amount of interest collected above the maximum rate permitted by applicable law, together with interest thereon at the rate required by applicable law, shall be refunded to Makers, and Makers agree that such refund shall be applied as a payment of Principal hereunder, provided, however, such payment shall not serve to cure any default hereunder.

<u>Section 8</u>. <u>Assignment of Note</u>.

Makers shall not assign or transfer this Note or its rights and/or obligations under this Note in any manner whatsoever without the prior written consent of Lender, or its successors and/or assigns. Any such attempted assignment by any Maker shall be deemed an Event of Default. Furthermore, Lender may assign its rights and obligations under this Note, subject to Buyer's set-off rights pursuant to Section 2(c) hereof. No assignment shall be effective unless the assigning party provides at least ten (10) days prior written notice of such assignment, identifying the assignee and providing the contact information of such assignee, including telephone number and email address.

<u>Section 9</u>. <u>Joint and Several Liability</u>.

The liabilities of Makers are joint and several; provided, however, the release by Lender of a Maker shall not release any other Maker obligated on this Note.

<u>Section 10</u>. <u>Miscellaneous</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) This Note may be altered only by prior written agreement signed by the party against whom enforcement of any waiver, change, modification, or discharge is sought. This Note may not be modified by an oral agreement, even if supported by new consideration.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Subject to Section 8, the covenants, terms and conditions contained in this Note apply to and bind the heirs, successors, executors, administrators and assigns of the parties.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) This Note shall be governed by and construed in accordance with the laws of the Commonwealth of Massachusetts. The agreed upon venue in connection with any litigation pertaining to this Note shall be Middlesex County, Massachusetts.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) This Note, the Security Agreement, the corporate guaranty provided by Makers' affiliate, and the rights and obligations thereunder, and the UCC1 statements filed in connection with the Security Agreement constitute the final written expressions of all the terms of the agreement between the parties regarding the subject matter hereof, are complete and exclusive statements of those terms, and supersede all prior agreements, understandings, and representations between the parties. If any provision or any word, term, clause or other part of any provision of this Note shall be invalid for any reason, the same shall be ineffective, but the remainder of this Note shall not be affected and shall remain in full force and effect. The words "execution," "signed," "signature," and words of similar import in the Note shall be deemed to include electronic or digital signatures or electronic records, each of which shall be of the same effect, validity, and enforceability as manually executed signatures or a paper-based record-keeping system, as the case may be, to the extent and as provided for under applicable law,

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) Any notice or other communication required or permitted to be given hereunder shall be in writing and shall be mailed by certified mail, return receipt requested (or by the most nearly comparable method if mailed from or to a location outside the United States) or by Federal Express, Express Mail, or similar overnight delivery, or courier service or delivered in person or by electronic transmission against receipt to the party to whom it is to be given at the address of such party set forth in this Section 9(e) (or to such other address as the party shall have furnished in writing in accordance with the provisions of this Section 9(e)).

Lender: Kathryn Boyd, as Shareholder Representative

[REDACTED]

Email: [REDACTED]

Makers: Severance Trucking Co., Inc.

Severance Warehousing, Inc.

McGrath Trailer Leasing, Inc.

TLSS-STI, Inc.

5500 Military Trail, Suite 22-357

Jupiter, FL 33458

Attn.: Sebastian Giordano, CEO

Email: [REDACTED]

(with a copy, which copy shall not constitute notice, to):

R\|A Feingold Law & Consulting, P.A.

401E. Las Olas Boulevard, Suite 1400

Ft. Lauderdale, FL 33301

Attn.: Robert A. Feingold, Esq.

Email: [REDACTED]

Such addresses may be changed by notice given as provided in this subsection. Notices shall be effective upon the date of receipt; provided, however, that a notice (other than a notice of a changed address) sent by certified or registered U.S. mail, with postage prepaid, shall be presumed received no later than three (3) business days following the date of sending.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) **MAKERS KNOWINGLY, INTENTIONALLY AND VOLUNTARILY WAIVE ANY RIGHT WHICH MAKERS MAY HAVE TO A TRIAL BY JURY IN CONNECTION WITH ANY MATTER DIRECTLY OR INDIRECTLY RELATING TO THIS NOTE, ANY OTHER DOCUMENT EXECUTED IN CONNECTION HEREWITH OR ANY OTHER MATTER ARISING FROM THE RELATIONSHIP BETWEEN LENDER AND ANY MAKER. MAKERS ACKNOWLEDGE THAT NEITHER LENDER NOR ANY PERSON ACTING ON BEHALF OF LENDER HAS MADE ANY REPRESENTATIONS OF FACT TO INDUCE THIS WAIVER OF TRIAL BY JURY OR IN ANY WAY MODIFY OR NULLIFY ITS EFFECT. MAKERS FURTHER ACKNOWLEDGE THAT EACH MAKER HAS BEEN REPRESENTED (OR HAS HAD THE OPPORTUNITY TO BE REPRESENTED) IN THE SIGNING OF THIS NOTE, AND IN THE MAKING OF THIS WAIVER BY INDEPENDENT LEGAL COUNSEL, SELECTED OF EACH MAKER'S OWN FREE WILL. IN ANY LITIGATION ARISING OUT OF OR RELATING TO THIS NOTE, EACH MAKER WAIVES THE RIGHT TO INTERPOSE ANY DEFENSE BASED UPON ANY STATUTE OF LIMITATIONS OR ANY CLAIM OF LACHES AND ANY SET-OFF OR COUNTER CLAIM OF ANY NATURE OF DESCRIPTION. EACH MAKER HEREBY CONSENTS TO THE JURISDICTION OF ANY STATE OR FEDERAL COURT IN OR FOR THE STATE OF MASSACHUSETTS.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) Makers agree to pay all taxes, duties and other charges in addition to the Principal Amount and interest on this Note including all documentary stamp taxes and intangible taxes, as may from time to time be payable or assessed on this Note or in respect of the ownership thereof.

IN WITNESS WHEREOF, each Maker has executed this Note effective as of the date first set forth above.

---

| | |
|:---|:---|
| TLSS-STI, Inc., a Delaware corporation | TLSS-STI, Inc., a Delaware corporation |
| By: | Transportation and Logistics Systems, |
|  | Inc., a Nevada |
|  | corporation, its sole shareholder |
| *By:* | */s/ Sebastian Giordano* |
| Name: | Sebastian Giordano |
| Title: | Chief Executive Officer |
| Severance Trucking Co., Inc., a Massachusetts corporation | Severance Trucking Co., Inc., a Massachusetts corporation |
| By: | TLSS-STI, Inc., a Delaware |
|  | corporation, its sole shareholder |
| *By:* | */s/ Sebastian Giordano* |
| Name: | Sebastian Giordano |
| Title: | Chief Executive Officer |

---

---

| | |
|:---|:---|
| Severance Warehousing, Inc., a Massachusetts corporation | Severance Warehousing, Inc., a Massachusetts corporation |
| By: | TLSS-STI, Inc., a Delaware |
|  | corporation, its sole shareholder |
| *By:* | */s/ Sebastian Giordano* |
| Name: | Sebastian Giordano |
| Title: | Chief Executive Officer |
| McGrath Trailer Leasing, Inc., a Maine corporation | McGrath Trailer Leasing, Inc., a Maine corporation |
| By: | TLSS-STI, Inc., a Delaware corporation, its sole shareholder |
| *By:* | */s/ Sebastian Giordano* |
| Name: | Sebastian Giordano |
| Title: | Chief Executive Officer |

---

## Exhibit 10.4

**Exhibit 10.4**

**<u>SECURITY AGREEMENT</u>**

THIS SECURITY AGREEMENT (the "<u>Security Agreement</u>") dated as of February 1, 2023 is by and among TLSS-STI, Inc., a Delaware corporation, Severance Trucking Co., Inc., a Massachusetts corporation, Severance Warehousing, Inc., a Massachusetts corporation and McGrath Trailer Leasing, Inc., a Maine corporation (individually, a "<u>Debtor</u>", and collectively, the "<u>Debtors</u>") and Kathryn Boyd, Clyde J. Severance and Robert H. Severance, Jr. (each, a "<u>Secured Party</u>", and collectively, the "<u>Secured Parties</u>").

<u>BACKGROUND</u>

The defined terms used in this Security Agreement shall have the respective meanings set forth in Section 1 hereof unless elsewhere defined or the context shall otherwise require.

In order to secure the repayment of the loan from the Secured Parties to the Debtors in the amount of USD $1,572,938.86, as evidenced by a Secured Promissory Note dated as of the date hereof (the "<u>Note</u>") and other obligations under the Note, the Debtors have agreed to deliver to the Secured Parties this Security Agreement.

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged and intending to be legally bound, the Debtors hereby agree with the Secured Parties as follows:

1. <u>INTERPRETATION OF AGREEMENT: DEFINITIONS</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.1. <u>Definitions</u>. Unless the context otherwise requires, the terms hereinafter set forth when used herein shall have the following meanings:

"<u>Default</u>" means an event which is or would constitute an Event of Default if any requirement in connection therewith for the giving of notice or lapse of time, or happening of any further condition, event or act, had been satisfied.

"<u>Event of Default</u>" has the meaning set forth in Section 5.1.

"<u>Indebtedness</u>" means all liabilities of the Debtors to the Secured Parties whether direct or indirect, absolute or contingent, due or to become due, now existing or hereafter arising, as related to the Note, whether for principal, interest, fees, expenses or otherwise.

"<u>Property</u>" means any interest in any kind of property or asset, whether real, personal or mixed, or intangible or tangible.

Unless the context shall otherwise require, all capitalized terms not otherwise defined herein shall have the meanings set forth in the Note.

2. <u>GRANT OF SECURITY</u>.

The Debtors hereby grant to the Secured Parties to secure the payment of all Indebtedness and performance of all obligations of the Debtors under the Note (collectively, the "<u>Obligations</u>"), a continuing first priority security interest in and lien on all of each Debtor's Property, assets and rights of every kind and nature, wherever located, whether now owned or hereafter acquired or arising, all proceeds and products thereof and all parts thereof and all accessions thereto (all of the same being hereinafter called the "<u>Collateral</u>"), including, without limiting the generality of the foregoing, the following properties, assets and rights owned by each Debtor, as applicable:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) all cash, funds, checks, notes and instruments from time to time on deposit in any of the Debtors' accounts;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) all real and personal property owned by a Debtor, including as set forth on Schedule 3.8 of the "SPA" as defined in the Note;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) all material contracts, commitments and similar agreements to which a Debtor is a party or by which it or any of its properties is bound, including, not limited to, contracts, with customers, leases, loan agreements, pledge and security agreements, indemnity or guaranty agreements, bonds, notes, mortgages, joint venture or partnership agreements, options to purchase real or personal property, and agreements relating to the purchase or sale of all such agreements, including as set forth on Schedule 3.9 of the SPA,;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) all licenses, franchises, permits, and other governmental authorizations and intangible assets held by a Debtor that are material to the conduct of its business including, without limitation, permits, licenses and operating authorizations, titles (including motor vehicle titles and current registrations), franchises, certificates, trademarks, trade names, patents, patent applications and copyrights owned or held by a Debtor, including as set forth on Schedule 3.10 of the SPA;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) all patents, patent applications, trademarks, service marks, trade names, copyrights, and other intellectual property or proprietary property rights owned or used by a Debtor, including as set forth on Schedule 3.22 of the SPA; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) all books and records, customer lists, and other files related to the foregoing.

3. <u>GENERAL REPRESENTATIONS, WARRANTIES AND COVENANTS</u>.

The Debtors individually and collectively represent and warrant to the Secured Parties that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.1. <u>Warranty of Title to Collateral and Security Interest</u>. The Debtors are the owners of the Collateral and that no other person or entity has any right, title, claim or interest (by way of lien or otherwise) in, against or to the Collateral. This Security Agreement is effective to create in favor of the Secured Parties, a legal, valid and enforceable security interest in the Collateral and the proceeds thereof. This Security Agreement shall constitute, and will at all times constitute, a fully perfected first priority lien on, and security interest in, all rights, title and interest of the Debtors in such Collateral and the proceeds thereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.2. <u>No Financing Statements</u>. There is no financing statement or similar notice now on file in any public office covering any Property of any kind which is part of the Collateral hereunder, or intended so to be, or in which the Debtors are named as or has signed as a debtor, except those naming the Secured Parties as secured parties or for which termination statements are on file or will be filed in connection with the transactions set forth herein, and so long as any Indebtedness remains unpaid, any Obligations remain outstanding, or this Security Agreement remains in effect, the Debtors will not execute, and there will not be on file in any public office any financing statement or statements except with respect to the financing statements filed or to be filed in respect of and for the security interest of the Secured Parties.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.3. <u>Location of Chief Place of Business</u>. The location of the Debtors chief place of business is 49 McGrath Road, Dracut, MA 01826. In the event that any of the Debtors discover that any representation made in this Section is untrue or incorrect for any reason, it will immediately notify the Secured Parties and take such actions as may be necessary to make such representation true and correct.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.4. <u>Valid Security Interest</u>. This Security Agreement creates a valid security interest in the Collateral securing the payment of the Indebtedness and the performance of the Obligations, and all filings and other actions necessary or desirable to perfect and protect such security interests have been, or will be, duly taken.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.5. <u>Consents</u>. No authorization, approval or other action by, and no notice to or filing with any governmental authority or regulatory body is required either (a) for the grant by the Debtors of the security interest granted hereby or for the execution, delivery or performance of this Security Agreement by the Debtors or (b) for the perfection of or the exercise by the Secured Parties of their rights and remedies hereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.6 <u>Classes of Stock</u>. The sole stockholder of Severance Trucking Co., Inc., Severance Warehousing, Inc., and McGrath Trailer Leasing, Inc (the "<u>Subsidiaries</u>") is TLSS-STI, Inc. (the "<u>Buyer</u>"). There is only one class of common stock and no shares of preferred stock of the Subsidiaries have been issued. At all times while any Indebtedness remains outstanding, the Debtors hereby covenant and agree that no additional shares of common stock of the Debtors shall be issued and no shares of preferred stock of the Debtors shall be issued.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.7 <u>Joinder</u>. Each Debtor shall cause each subsidiary of Debtor to execute and deliver to the Secured Parties a joinder to this Security Agreement within 30 days of the date on which it was acquired or created and, upon such execution and delivery, such subsidiary shall constitute a "Debtor" for all purposes hereunder with the same force and effect as if originally named as a Debtor herein. The rights and obligations of each Debtor hereunder shall remain in full force and effect notwithstanding the addition of any new Debtor as a party to this Security Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.8 <u>Authority</u>. Each Debtor has the power and authority, and the legal right, to own or lease and operate its property, and to carry on the business as now conducted and as proposed to be conducted, and to execute, deliver and perform this Security Agreement. Each Debtor has taken all necessary organizational action to authorize the execution, delivery and performance of the Security Agreement. No consent or authorization of, filing with, notice to or other act by, or in respect of, any governmental authority or any other person is required in connection with the execution, delivery, performance, validity or enforceability of this Security Agreement. This Security Agreement constitutes a legal, valid and binding obligation of each Debtor hereto, enforceable against each such Debtor in accordance with its terms. The execution, delivery and performance of this Security Agreement will not violate any law or any contractual obligation of any Debtor.

4. <u>PARTICULAR COVENANTS OF THE DEBTORS</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.1. <u>Payment of Indebtedness</u>. The Debtors agree to pay all Indebtedness at the time and place and in the manner as provided in the Note and in a timely fashion comply with and perform and fulfill the terms, covenants and conditions contained herein and in the Note.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.2. <u>Perfection and Maintenance of Lien; Recording</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The Debtors will, at their own expense, take all actions requested by the Secured Parties to maintain and preserve the lien of this Security Agreement so long as any Indebtedness or Obligations are outstanding.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The Debtors will, forthwith, upon the execution and delivery of this Security Agreement and thereafter from time to time, cause this Security Agreement and all required financing statements to be filed, registered and recorded in such manner and in such places as shall be necessary or desirable as the Secured Parties may reasonably request, in order to publish notice of and fully protect the lien thereof as it relates to the Collateral, and in order to continue such protection, refile, reregister and rerecord whenever necessary, and from time to time upon the reasonable request of the Secured Parties will perform or cause to be performed any other act as provided by law and will execute or cause to be executed any and all further instruments for such publication and protection. To the extent permitted by applicable law, the Debtors will pay or cause to be paid all filing, registration and recording taxes and fees incident to such filing, registration and recording, any federal or state stamp taxes and other taxes, duties, imposts, assessments and charges arising out of or in connection with the execution and delivery of this Security Agreement and all required financing statements and each such instrument of further assurance. Without limiting the foregoing, the Debtors hereby authorize the Secured Parties to file one or more financing or continuation statements, and amendments thereto, relative to all or any part of the Collateral without the signatures of the Debtors where permitted by law. A carbon, photographic or other reproduction of this Security Agreement or any financing statement covering the Collateral or any part thereof shall be sufficient as a financing statement where permitted by law.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.3. <u>Further Assurances; After-Acquired Property</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The Debtors will do, execute, acknowledge and deliver, or cause to be done, executed, acknowledged and delivered, all such further acts, deeds, conveyances, mortgages, assignments, transfers and assurances as may be necessary or desirable or as the Secured Parties reasonably may require for the perfection of the lien being herein provided for in the Collateral.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) All right, title, and interest of the Debtors in and to all additions to the Collateral or any part thereof, hereafter acquired by the Debtors, immediately upon such acquisition, and without any further mortgage, conveyance or assignment, shall become and be part of the Collateral and shall be subject to the lien of this Security Agreement as fully and completely and with the same effect as though now owned by the Debtors, but at any and all times the Debtors will execute and deliver to the Secured Parties any and all such further assurances, mortgages, conveyances or assignments thereof and financing statements and other instruments with respect thereto as shall be necessary or desirable or as the Secured Parties may reasonably require for the purpose of expressly and specifically subjecting the same to the lien of this Security Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.4. <u>Right of Secured Parties to Perform Covenants, Etc</u>. If the Debtors shall fail to make any payment or perform any act required to be made or performed hereunder, the Secured Parties, without waiving or releasing any obligation or Default, may, (but shall be under no obligation to) at any time thereafter, make such payment or perform such act for the account and at the expense of the Debtors, and may enter upon any Property of the Debtors for such purpose and take all such action thereon as, in the opinion of the Secured Parties, may be necessary or appropriate therefor. All sums so paid by the Secured Parties and all costs and expenses (including without limitation, reasonable attorneys' fees and expenses) so incurred, together with interest thereon at the rate set forth in the Note for overdue payments from the date of payment or incurrence, shall be secured hereby and shall be paid by the Debtors to the Secured Parties on demand. The Secured Parties in making any payment authorized under this Section relating to taxes or assessments may do so according to any bill, statement or estimate procured from the appropriate public office without inquiry into the accuracy of such bill, statement or estimate or into the validity of any tax assessment, sale, forfeiture, tax lien or title or claim thereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.6. <u>Maintenance of Office and Collateral</u>. The Debtors shall keep their chief place of business and chief executive office at the location therefor specified in Section 3.3. The Debtors will hold and preserve such records and will permit representatives of the Secured Parties at any time during normal business hours to inspect and make abstracts from such records. The Debtors shall maintain, protect, and keep all Collateral in good condition, and shall maintain insurance policies covering the Collateral consistent with the policies currently maintained for the Collateral as of the date of this Security Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.7. <u>Notification</u>. Each Debtor shall notify the Secured Parties within thirty (30) days of (a) the formation or acquisition of any new subsidiary of a Debtor; (b) any change in the name or jurisdiction of a Debtor; (c) any change in the type of organization or structure of a Debtor; (d) any new location where any Collateral will be held, and (e) any new indebtedness of a Debtor.

5. <u>DEFAULTS; REMEDIES OF THE SECURED PARTIES</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.1. <u>Definition of Event of Default</u>. The following events are hereby defined for all purposes of this Security Agreement as "<u>Events of Default"</u>:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Default by the Debtors in making any payment on any Indebtedness, after the expiration of all applicable grace, notice and cure periods;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) any representation or warranty made by the Debtors in this Security Agreement shall prove to have been incorrect in any material respect when made;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) the Debtors shall fail to perform or observe any other term or agreement contained in this Security Agreement, and such failure shall not be cured within a period of ten (10) days after notice thereof from a Secured Party to a Debtor;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) the failure of Buyer to perform the Obligations; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) any Event of Default shall occur under Section 4 of Note.

If any one or more Events of Default shall occur and be continuing after the expiration of all applicable grace, notice and cure periods, then, and in each and every such case, the Secured Parties may declare the Indebtedness, if not already due and payable, to be immediately due and payable, all notice of intention to accelerate or any other notice being hereby expressly waived by each Debtor.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.2. <u>Completed Default; Acceleration of Maturity</u>. Upon declaration by the Secured Parties of the acceleration of maturity of the Indebtedness in accordance with Section 5.1, the Debtors shall pay to the Secured Parties the whole amount which then shall have become due on the Indebtedness. In case the Debtors shall fail to pay the same forthwith, the Secured Parties shall be entitled to recover judgment for the whole amount so due and unpaid against the Debtors. The right of the Secured Parties to recover such judgment shall not be affected by the exercise of any other right, power or remedy for the enforcement of the provisions of this Security Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.3. <u>Remedies</u>. In case of the happening of an Event of Default as defined in Section 5.1, the Secured Parties may exercise, in addition to all other rights and powers described herein or permitted under applicable law, all remedies available to a secured creditor under applicable law, all remedies available to a secured party or creditor under any applicable Uniform Commercial Code and all or any of the following powers:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The Secured Parties may protect and enforce their rights by bringing such actions, at law or in equity or before any administrative tribunal, as the Secured Parties, shall deem appropriate, including, without limitation, actions for the specific performance of any covenant hereof; and the Secured Parties shall be entitled to recover judgment for any and all sums then, or during any Default, becoming due and payable by the Debtor under any provision hereof, including, without limitation, any deficiency in the payment of all amounts due under the provisions hereof remaining after any sale of the Collateral and, in addition thereto, such amounts as shall be sufficient to cover the costs and expenses of collection, including reasonable attorneys' fees, and of other proceedings hereunder, and to collect out of the Property of the Debtors in any manner provided by law all amounts adjudged or decreed to be payable.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Secured Parties as a matter of contract right and not as a penalty shall be entitled to the appointment of a receiver of, or may enter upon and take possession of, all or any part of the Collateral, and such receiver or the Secured Parties shall thereupon be entitled to make all expenditures and to take all actions necessary or desirable therefor, and to collect and retain all income and earnings arising from such Property or business.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Without notice except as specified below, the Secured Parties may sell the Collateral or any part thereof in one or more parcels at public or private sale, at any of the Secured Parties offices or elsewhere, for cash, on credit or for future delivery, and upon such other terms as the Secured Parties may deem commercially reasonable. The Debtors agree that, to the extent notice of sale shall be required by law, at least ten days notice to the Debtors of the time and place of any public sale or the time after which any private sale is to be made shall constitute reasonable notification. The Secured Parties shall not be obligated to make any sale of Collateral regardless of notice of sale having been given. The Secured Parties may adjourn any public or private sale from time to time by announcement at the time and place fixed therefor, and such sale may, without further notice, be made at the time and place to which it is so adjourned.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.4. <u>Sale to Accelerate Indebtedness</u>. In the event of any sale made under or by virtue of this Security Agreement, whether made under the power of sale herein granted or under or by virtue of judicial proceedings or of a valid judgment, the Indebtedness, if not previously due, immediately thereupon shall become due and payable, anything in this Security Agreement to the contrary notwithstanding.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.5. <u>Application of Proceeds of Sale</u>. The purchase money proceeds or avails of any sale of the Collateral shall be applied as follows:

<u>First</u>: To the payment of the costs and expenses of suit, if any, and of such sale, and to the extent permitted by applicable law, the reasonable compensation of the Secured Parties agents, attorneys and counsel, and of all proper expenses, liability and advances incurred or made hereunder by the Secured Parties, and of all taxes, assessments or liens superior to the lien of these presents, except any taxes, assessments or other superior lien subject to which said sale may have been made;

<u>Second</u>: To the amount then owing or unpaid on the Indebtedness; and

<u>Third</u>: To the payment of the surplus, if any, to the Debtors and there successors or assigns, or to whomsoever may be lawfully entitled to receive the same or as may be directed by a court of competent jurisdiction.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.6. <u>Purchase of Collateral</u>. Upon any sale made under or by virtue of this Security Agreement, the Secured Parties may bid for and purchase the Collateral being sold, and upon compliance with the terms of sale, may hold, retain and possess and dispose of such Property in their own absolute right without further accountability; and the Secured Parties at any such sale may, in paying the purchase price, apply any amount of the Indebtedness then unpaid in lieu of cash to the amount which shall, upon distribution of the net proceeds of such sale, be payable thereon.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.7. <u>Waiver</u>. The Secured Parties may in writing waive any Default or Event of Default hereunder and its consequences which result from the failure of the Debtors to comply with any provisions of this Security Agreement. In case of any such waiver, or in case any proceedings taken on account of any such Default or Event of Default shall be discontinued or abandoned or determined adversely to the Secured Parties, then and in every such case, the Debtors and the Secured Parties shall be restored to their former positions and rights hereunder respectively. No such waiver shall extend to any subsequent or other Default or Event of Default or impair any right consequent thereon.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.8. <u>Remedies Cumulative</u>. No remedy herein conferred upon or reserved to the Secured Parties is intended to be exclusive of any other remedy or remedies, and each and every such remedy shall be cumulative, and shall be in addition to every other remedy given hereunder or now or hereafter existing at law or in equity or by statute.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.9. <u>Delay or Omission Not a Waiver</u>. No delay or omission of the Secured Parties to exercise any right or power accruing upon any Default or Event of Default shall impair any such right or power or shall be construed to be a waiver of any such Default or Event of Default or an acquiescence therein; and every power and remedy given by this Security Agreement to the Secured Parties may be exercised from time to time and as often as may be deemed expedient by a Secured Party.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.10. <u>Secured Party Appointed Attorney-in-Fact</u>. Each Debtor hereby irrevocably appoints each Secured Party as such Debtor's attorney-in-fact, with full authority in the place and stead of the Debtor and in the name of the Debtor, the Secured Party or otherwise, from time to time in the Secured Party's discretion, to take any action and to execute any instrument which the Secured Party may deem necessary or advisable to accomplish the purposes of this Security Agreement, including, without limitation: (a) to ask, demand, collect, sue for, recover, compound, receive and give acquittance and receipts for moneys due and to become due under or in respect of any of the Collateral, (b) to receive, endorse, and collect any drafts or other instruments, documents and chattel paper, in connection with clause (a) above, and (c) to file any claims or take any action or institute any proceedings which a Secured Party may deem necessary or desirable for the collection of any of the Collateral or otherwise to enforce the rights of a Secured Party with respect to any of the Collateral.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.11. <u>Duty of Secured Party</u>. A Secured Party's sole duty with respect to the custody, safekeeping and physical preservation of the Collateral in its possession shall be to deal with it in the same manner as the Secured Party deals with similar property for the Secured Party's own account. Neither the Secured Party nor any of its agents shall be liable for failure to demand, collect or realize upon any of the Collateral or for any delay in doing so or shall be under any obligation to sell or otherwise dispose of any Collateral upon the request of a Debtor or any other Person or to take any other action whatsoever with regard to the Collateral or any part thereof. The powers conferred on the Secured Party hereunder are solely to protect the Secured Party's interest in the Collateral and shall not impose any duty upon the Secured Party to exercise any such powers. The Secured Party shall be accountable only for amounts that the Secured Party actually receives as a result of the exercise of such powers, and neither the Secured Party nor any of the Secured Party's agents shall be responsible any Debtor for any act or failure to act hereunder, except for their own gross negligence or willful misconduct.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.12. <u>Execution of Financing Statements and Perfection Instruments</u>. Debtors authorize each Secured Party to file or record financing statements and other filings or recording documents or instruments with respect to the Collateral without the signature of any Debtor in such form and in such offices as the Secured Party reasonably determines appropriate to perfect the security interests of the Secured Party under this Security Agreement. A photographic or other reproduction of this Security Agreement or any financing statement covering the Collateral or any part thereof shall be sufficient as a financing statement where permitted by law.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.13. <u>Expenses; Indemnity</u>. The Debtors hereby agree to reimburse each Secured Party on demand, for all costs and expenses incurred by a Secured Party in enforcing this Security Agreement (including expenses of agents and attorneys employed by the Secured Party). The Debtors agree to indemnify and save and hold each Secured Party harmless from and against any and all claims, damages, loss, liability or judgments which may be incurred or sustained by any Secured Party or asserted against a Secured Party directly or indirectly, in connection with the existence of or the lawful exercise of any of the rights under this Security Agreement except such claims, damages, loss, liability or judgments as may result from the gross negligence or willful misconduct of a Secured Party.

6. <u>DEFEASANCE</u>.

If the Debtors shall pay and discharge or provide, in a manner satisfactory to the Secured Parties, for the payment and discharge of the whole amount of the Indebtedness, then and in that case all Property, rights and interests hereby conveyed or assigned or pledged shall revert to the Debtors, and the estate, right, title and interest of the Secured Parties shall thereupon terminate; and the Secured Parties, in such case, on demand of the Debtors and at the Debtors expense, shall execute and deliver to the Debtors a proper instrument or proper instruments acknowledging the satisfaction and termination of this Security Agreement, and shall convey, assign and transfer, or cause to be conveyed, assigned or transferred, and shall deliver or cause to be delivered, to the Debtors, all Property, including money, then held by the Secured Parties, other than moneys deposited with the Secured Parties for the payment of the Indebtedness.

7. <u>MISCELLANEOUS PROVISIONS</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.1. <u>Security Agreement for Benefit of Parties Hereto.</u> Nothing in this Security Agreement, expressed or implied, is intended or shall be construed to confer upon or to give to, any Person other than the parties hereto, any right, remedy or claim under or by reason of this Security Agreement or any covenant, condition or stipulation hereof; and the covenants, stipulations and agreements contained in this Security Agreement are and shall be for the sole and exclusive benefit of the parties hereto, and their successors and permitted assigns.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.2. <u>Severability</u>. In case any one or more of the provisions contained in this Security Agreement shall be invalid, illegal or unenforceable in any respect, the validity, legality and enforceability of the remaining provisions contained herein shall not in any way be affected or impaired thereby.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.3. <u>Notices</u>. All notices, claims, requests, demands and other communications hereunder shall be in writing and shall be deemed to have been duly given if personally delivered or if sent by nationally-recognized overnight courier, by telecopy, by email or by registered or certified mail, return receipt requested and postage prepaid, addressed as follows:

---

| |
|:---|
| If to a Debtor: |
| Severance Trucking Co., Inc. |
| Severance Warehousing, Inc. |
| McGrath Trailer Leasing, Inc. |
| TLSS-STI, Inc. |
| 5500 Military Trail, Suite 22-357 |
| Jupiter, FL 33458 |
| Attn.: Sebastian Giordano, CEO |
| Email: [REDACTED] |
| With a copy to: |
| R\|A Feingold Law & Consulting, P.A. |
| 401 E. Las Olas Boulevard, Suite 1400 |
| Ft. Lauderdale, FL 33301 |
| Attention: Robert A. Feingold, Esq. |
| Email: [REDACTED] |
| If to a Secured Party: |
| Kathryn Boyd, as Secured Party Representative |
| [REDACTED] |
| Email: [REDACTED]; |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.4. <u>Successors and Assigns</u>. Debtors shall not assign or transfer this Security Agreement or any its rights and/or obligations under this Note in any manner whatsoever without the prior written consent of the Secured Parties. Any such attempted assignment shall be deemed an Event of Default. Whenever in this Security Agreement any of the parties hereto is named or referred to, the successors and assigns of such party shall be deemed to be included, and all the covenants, promises and agreements in this Security Agreement contained by or on behalf of the Debtors, or on behalf of the Secured Parties shall bind and inure to the benefit of their respective successors and assigns, whether so expressed or not.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.5. <u>Counterparts; Descriptive Headings</u>. This Security Agreement is being executed in any number of counterparts, each of which is an original and all of which are identical. Each counterpart of this Security Agreement is to be deemed an original hereof and all counterparts collectively are to be deemed but one instrument. The descriptive headings of the several Sections to this Security Agreement were inserted in this Security Agreement for convenience only and shall not be deemed to affect the meaning or construction of any of the provisions hereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.6. <u>Security Interest Absolute</u>. All rights of the Secured Parties and security interests hereunder, and all obligations of the Debtors hereunder, shall be absolute and unconditional, irrespective of:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) any lack of validity or enforceability of the Note or any other agreement or instrument relating thereto;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) any change in the time, manner, or place of payment of, or in any other term or, all or any of the Indebtedness or any other amendment or waiver of or any consent to any departure from this Security Agreement or the Note.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) any exchange, release or non-perfection of any other Collateral, or any release or amendment or waiver of or consent to departure from any guaranty, for all or any of the Indebtedness; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) any other circumstance which might otherwise constitute a defense available to, or a discharge of, a Debtor or a third party grantor of a security interest.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.7. <u>Amendments, Etc.</u> No amendment or waiver of any provision of this Security Agreement nor consent to any departure by the Debtors here from shall in any event be effective unless the same shall be in writing and signed by the Secured Parties, and then such waiver or consent shall be effective only in the specific instance and for the specific purpose for which given.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.8. <u>Governing Law; Terms</u>. This Security Agreement shall be governed by and construed in accordance with the internal laws of the Commonwealth of Massachusetts, without regard to the conflicts of law principles thereof. Unless otherwise defined herein or in the Note, terms used in Article 9 of the Uniform Commercial Code in the Commonwealth of Massachusetts are used herein as therein defined. The Debtors and the Secured Parties irrevocably consent to the jurisdiction of the courts of the Commonwealth of Massachusetts or the federal courts located in that state in connection with any lawsuit, action or proceeding arising out of or relating to this Security Agreement.

[*Signature Page Follows*]

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

---

| | |
|:---|:---|
| Severance Trucking Co., Inc., a Massachusetts corporation | Severance Trucking Co., Inc., a Massachusetts corporation |
| By: | TLSS-STI, Inc., a Delaware corporation, its sole shareholder |
| By: | */s/ Sebastian Giordano* |
| Name: | Sebastian Giordano |
| Title: | Chief Executive Officer |
| Severance Warehousing, Inc., a Massachusetts corporation | Severance Warehousing, Inc., a Massachusetts corporation |
| By: | TLSS-STI, Inc., a Delaware corporation, its sole shareholder |
| By: | */s/ Sebastian Giordano* |
| Name: | Sebastian Giordano |
| Title: | Chief Executive Officer |
| McGrath Trailer Leasing, Inc., a Maine corporation | McGrath Trailer Leasing, Inc., a Maine corporation |
| By: | TLSS-STI, Inc., a Delaware corporation, its sole shareholder |
| By: | */s/ Sebastian Giordano* |
| Name: | Sebastian Giordano |
| Title: | Chief Executive Officer |
| TLSS-STI, Inc., a Delaware corporation | TLSS-STI, Inc., a Delaware corporation |
| By: | */s/ Sebastian Giordano* |
| Name: | Sebastian Giordano |
| Title: | Chief Executive Officer |

---

---

| |
|:---|
| */s/ Kathryn Boyd* |
| Name: Kathryn Boyd |
| */s/ Clyde J. Severance* |
| Name: Clyde J. Severance |
| */s/ Robert H. Severance, Jr.* |
| Name: Robert H. Severance, Jr. |

---

## Exhibit 10.5

**Exhibit 10.5**

<u>ABSOLUTE, UNCONDITIONAL AND CONTINUING GUARANTY</u>

THIS ABSOLUTE, UNCONDITIONAL AND CONTINUING GUARANTY, dated as of the 1<sup>st</sup> day of February, 2023 (this "Guaranty"), is executed by Transportation and Logistics Systems, Inc., a Nevada corporation (herein referred to as the "Guarantor"), in favor of Kathryn Boyd, Clyde J. Severance and Robert H. Severance, Jr. (individually, a "Shareholder" and collectively, the "Shareholders" or the "Lenders").

W I T N E S S E T H :

WHEREAS, TLSS-STI, Inc., a Delaware corporation, Severance Trucking Co., Inc., a Massachusetts corporation, Severance Warehousing, Inc., a Massachusetts corporation and McGrath Trailer Leasing, Inc., a Maine corporation (collectively, the "Debtor") are indebted to the Shareholders, pursuant to a certain Secured Promissory Note dated as of February 1, 2023 in the principal amount of $1,572,938.86 (the "Note') in connection with the payment of a portion of the purchase price under a certain Stock Purchase and Sale Agreement dated as of January 4, 2023, as assigned and amended, pursuant to which the Shareholders have sold all of the shares of Severance Trucking Co., Inc., Severance Warehousing, Inc., and McGrath Trailer Leasing, Inc.to TLSS-STI, Inc., which is wholly owned by the Guarantor; and

WHEREAS, without this Guaranty, Shareholders would be unwilling to extend credit to the Debtor; and

WHEREAS, because of the direct benefit to Guarantor from the loan in the principal amount of $1,572,938.86 to be made by Shareholders in favor of the Debtor, as evidenced by the Note and as an inducement to the Shareholders to make said loan to the Debtor, Guarantor agrees to guarantee to the Shareholders the obligations of the Debtor as set forth herein.

NOW, THEREFORE, for Ten Dollars ($10.00) and other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, Guarantor hereby guarantees to the Shareholders the prompt and full payment of the "Guaranteed Indebtedness" (hereinafter defined), as and when the same shall be due and payable, whether by lapse of time, by acceleration of maturity, or otherwise, and at all times thereafter, and performance of all obligations of the Debtor in connection with the Guaranteed Indebtedness, this Guaranty being upon the following terms and conditions:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. The term "Guaranteed Indebtedness", as used herein, includes, without limitation: (a) all sums now or hereafter due and owing pursuant to the terms of (i) the Note, (ii) the Security Agreement, (iii) the UCC-1 Financing Statements and (iv) this Guaranty (collectively "Loan Documents"), the terms and provisions of which are agreed to, accepted, and acknowledged by Guarantor; (b) interest on any of the indebtedness described in the preceding subsection (a); (c) any and all costs, attorneys' fees, and expenses incurred by the Shareholders by reason of the Debtor's default in payment of any of the foregoing indebtedness; (d) any renewal, extension, modification, or rearrangement of the indebtedness, costs, or expenses described above, or any part thereof; (e) any amount of the foregoing indebtedness paid by the Debtor to the Shareholders which is later set aside in a bankruptcy proceeding; and (f) the indebtedness and obligations arising under the "Loan Documents" (as such term is hereinafter defined), plus all costs and legal fees associated therewith incurred by the Shareholders in connection with enforcement of and collection of the same.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. Guarantor, hereby absolutely, unconditionally and irrevocably guarantees, as primary obligor and not merely as surety, the due and prompt payment by the Debtor of the Guaranteed Indebtedness and the due and prompt performance of all covenants, agreements, obligations, and liabilities of the Debtor under the Loan Documents. This instrument shall be an absolute and continuing guaranty of payment and performance and not one only of collection, and shall cover all of the Guaranteed Indebtedness.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. If Guarantor becomes liable for any indebtedness or obligation owing by the Debtor to the Shareholders, by endorsement or otherwise, other than under this Guaranty, such liability shall not be in any manner impaired or affected hereby, and the rights of the Shareholders hereunder shall be cumulative of any and all other rights that the Shareholders may ever have against Guarantor. The exercise by the Shareholders of any right or remedy hereunder or under any other instrument, or at law or in equity, shall not preclude the concurrent or subsequent exercise of any other right or remedy. If, for any reason whatsoever, any of the Debtor is now, or hereafter becomes, indebted to Guarantor, such indebtedness and all interest thereon shall, at all times, be subordinate in all respects to the Guaranteed Indebtedness, and Guarantor shall not be entitled to enforce or receive payment thereof until the Guaranteed Indebtedness has been fully paid. Notwithstanding anything to the contrary contained in this Guaranty, or as a result of any payments made by any party hereunder, Guarantor (so long as the Guaranteed Indebtedness or any portion thereof remains outstanding) shall not have any right of subrogation, reimbursement, exoneration, indemnification, participation, and/or contribution against the Debtor or any other guarantor of the Guaranteed Indebtedness, any and all such right(s) of subrogation, reimbursement, exoneration, indemnification, participation, and/or contribution being hereby expressly waived and released. Accordingly, Guarantor shall not have any right of subrogation, reimbursement, exoneration, indemnification, participation, and/or contribution under the documents executed in favor of the Shareholders securing payment of the Guaranteed Indebtedness or to participate in any way therein, or in any right, title, or interest in and to any collateral for the Guaranteed Indebtedness, all such rights of subrogation, reimbursement, exoneration, indemnification, participation, and/or contribution being hereby expressly waived and released.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4. In the event of default by the Debtor of its performance under the Loan Documents or in payment of the Guaranteed Indebtedness, or any part thereof, when such indebtedness becomes due, either by its terms or as the result of the exercise of any power to accelerate, Guarantor shall, on written demand and without further notice of nonpayment or of dishonor, without any notice having been given to Guarantor previous to such demand of the acceptance by the Shareholders of this Guaranty and without any notice having been given to Guarantor previous to such demand of the creating or incurring of such indebtedness, pay the amount due thereon to the Shareholders, and it shall not be necessary for the Shareholders, in order to enforce such payment by Guarantor, first to institute suit or exhaust its remedies against the Debtor or others liable on such indebtedness, or to enforce its rights against any security which shall ever have been given to secure such indebtedness. Suit may be brought or demand may be made against all parties who have signed this Guaranty or any other guaranty of the Guaranteed Indebtedness, or against any one or more of them, separately or together, without impairing the rights of the Shareholders against any other party hereto.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5. Guarantor hereby agrees that Guarantor's obligations under the terms of this Guaranty shall not be released, diminished, impaired, reduced, or affected by the occurrence of any one or more of the following events: (a) the taking or accepting of any other security or guaranty for any or all of the Guaranteed Indebtedness; (b) any release, surrender, exchange, subordination, sale, disposition, or loss of any security at any time existing in connection with any or all of the Guaranteed Indebtedness; (c) any partial release of the liability of Guarantor hereunder or, if there is more than one person or entity signing this Guaranty, the complete or partial release of any one or more of them hereunder; (d) the death, insolvency, bankruptcy, disability, dissolution, termination, receivership, reorganization or lack of corporate, partnership or other power of the Debtor, any of the undersigned, or any party at any time liable for the payment of any or all of the Guaranteed Indebtedness, whether now existing or hereafter occurring; (e) renewal, extension, modification or rearrangement of the payment of any or all of the Guaranteed Indebtedness, either with or without notice to or consent of Guarantor, or any adjustment, indulgence, forbearance, or compromise that may be granted or given by the Shareholders to the Debtor or Guarantor; (f) any neglect, delay, omission, failure, or refusal of the Shareholders to take or prosecute any action for the collection of any of the Guaranteed Indebtedness or to foreclose or take or prosecute any action to foreclose upon any security therefor, or to take or prosecute any action in connection with any instrument or agreement evidencing or securing all or any part of the Guaranteed Indebtedness; (g) any failure of the Shareholders to notify Guarantor of any renewal, extension, rearrangement, modification or assignment of the Guaranteed Indebtedness or any part thereof, or of any instrument evidencing or securing the Guaranteed Indebtedness or any part thereof, or of the release of or change in any security or of any other action taken or refrained from being taken by the Shareholders against the Debtor or of any new agreement between the Shareholders and the Debtor, it being understood that the Shareholders shall not be required to give Guarantor any notice of any kind under any circumstances with respect to or in connection with the Guaranteed Indebtedness and Guarantor hereby waives such notice; (h) the illegality, lack of validity, unenforceability of all or any part of the Guaranteed Indebtedness against the Debtor, whether because the Guaranteed Indebtedness exceeds the amount permitted by law, it being agreed that Guarantor shall remain liable hereon regardless of whether the Debtor or any other person be found not liable on the Guaranteed Indebtedness, or any part thereof, for any reason; (i) any default, failure or delay, willful or otherwise, in Debtor's performance of the obligations under the Loan Documents; (j) any defense, set-off or counterclaim that may at any time be available to, or be asserted by, the Debtor; (k) the failure of this Guaranty to be properly authorized or delivered by the Guarantor or any Loan Documents to be authorized and delivered by the parties thereto; or (l) any payment by the Debtor to the Shareholders is held to constitute a preference under the bankruptcy laws or if, for any other reason, the Shareholders are required to refund such payment or pay the amount thereof to someone else. It is the intent of Guarantor and the Shareholders that the obligations and liabilities of Guarantor hereunder are absolute and unconditional under any and all circumstances and that until the Guaranteed Indebtedness is fully and finally paid, such obligations and liabilities shall not be discharged or released, in whole or in part, by any act or occurrence which might, but for the provisions of this Guaranty, be deemed a legal or equitable discharge or release of a guarantor.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7. In case of any sale by the Shareholders of any such security or property on credit or for future delivery, such may be retained by the Shareholders until the selling price is paid by the purchaser and the Shareholders shall incur no liability in case of failure of the purchaser to pay therefor. In case of any such failure, any such security or property may be resold.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8. This Guaranty is for the benefit of the Shareholders and the Shareholders' successors and assigns and, in the event of an assignment of the Guaranteed Indebtedness, or any part thereof, the rights and benefits hereunder, to the extent applicable to the indebtedness so assigned, may be transferred with such indebtedness. This Guaranty is binding not only on Guarantor, but on Guarantor's heirs, personal representatives and/or successors and assigns and, if this Guaranty is signed by more than one person or entity, then all of the obligations of Guarantor arising herein shall be jointly and severally binding on Guarantor and Guarantor's heirs, personal representatives, successors, and assigns. This Guaranty shall be governed by and construed in accordance with the internal laws (and not the law of conflicts) of the Commonwealth of Massachusetts, and is intended to be performed in accordance with, and only to the extent permitted by, such laws. If any provision of this Guaranty or the application thereof to any person or circumstance shall, for any reason and to any extent, be invalid or unenforceable, neither the remainder of this Guaranty nor the application of such provision to any other person or circumstances shall be affected thereby, but rather the same shall be enforced to the greatest extent permitted by law. Guarantor hereby agrees with the Shareholders that all rights, remedies and recourses afforded to the Shareholders by reason of this Guaranty or otherwise are separate and cumulative and may be pursued separately, successively or concurrently, as occasion therefor shall arise, and are nonexclusive and shall in no way limit or prejudice any other legal or equitable right, remedy or recourse which the Shareholders may have. Guarantor shall pay the reasonable attorneys' fees and all other costs and expenses which may be incurred by the Shareholders in the enforcement of this Guaranty.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9. It is not the intention of the Shareholders or Guarantor to obligate Guarantor to pay interest in excess of that legally permitted to be paid by Guarantor under applicable law. Should it be determined that any portion of the Guaranteed Indebtedness constitutes interest in excess of the maximum amount of interest which Guarantor (in such capacity) may lawfully be required to pay under applicable law, the obligation of Guarantor to pay such interest shall automatically be limited to the payment thereof at the maximum rate so permitted under applicable law.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10. Guarantor does hereby and shall indemnify and hold the Shareholders harmless of and from any and all loss or damage of whatsoever kind and from any suits, claims, or demands, including, without limitation, the Shareholders' legal fees and expenses through all trial and appellate levels, on account of any matters or anything arising out of this Guaranty or in connection herewith on account of any such acts or omissions to act by the Shareholders in connection with this Guaranty, which obligations shall survive termination of this Guaranty, other than any of the foregoing arising out of the gross negligence or willful misconduct of the Shareholders.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11. Upon the filing of a petition in bankruptcy with respect to the Debtor, any assignment for the benefit of creditors of the Debtor, or any other circumstances necessitating the Shareholders to file their claim against the Debtor, Guarantor agrees that, notwithstanding any stay, injunction or other prohibition preventing the maturity, acceleration or collection of all or any portion of the Guaranteed Indebtedness, the Guaranteed Indebtedness (whether or not then due and payable by the Debtor) shall forthwith become due and payable by Guarantor for purposes of this Guaranty, on demand. The obligation of Guarantor to pay the Guaranteed Indebtedness of Guarantor hereunder shall not be affected or impaired by the Shareholders' omission or failure to prove its claim against the Debtor. Accordingly, the rights of the Shareholders under this Guaranty shall not be affected or impaired by their election to prove their claim(s) or its election not to pursue such claim(s), as the Shareholders see fit, without in any way releasing, reducing or otherwise affecting the liability to the Shareholders of Guarantor.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12. Notwithstanding that this Guaranty may have been cancelled or terminated, in the event that all or any part of the Guaranteed Indebtedness is paid by or on behalf of the Debtor and because of any bankruptcy or other laws relating to creditor rights, the Shareholders repay any amounts to the Debtor or to any trustee, receiver or otherwise, then the amount so repaid shall again become part of the Guaranteed Indebtedness, the repayment of which is guaranteed hereby, and Guarantor shall immediately repay all such amounts to the Shareholders. If the original of this Guaranty was marked "Cancelled" by the Shareholders and returned to Guarantor, for the purposes of this Section, a photocopy or other reproduction of this Guaranty shall constitute the original of this Guaranty.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13. Guarantor hereby unconditionally and irrevocably waives any right to revoke this Guaranty and acknowledges that this Guaranty is continuing in nature and applies to all presently existing and future obligations of the Debtor under the Loan Documents. Guarantor hereby unconditionally and irrevocably waives promptness, diligence, notice of acceptance, presentment, demand for performance, notice of non-performance, default, acceleration, protest or dishonor and any other notice with respect to any of the obligations of the Debtor under the Loan Documents. Guarantor hereby unconditionally and irrevocably waives any defense based on any right of set-off or recoupment or counterclaim against or in respect of the obligations of the Guarantor hereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14. Unless otherwise provided, all notices required to be given hereunder shall be in writing and shall be deemed served on the earlier of (i) receipt, whether delivered by hand, electronic transmission or overnight mail, by a nationally recognized carrier, or (ii) forty-eight (48) hours after deposit in certified United States mail, postage prepaid, and addressed to the parties at the following addresses, or such other addresses as may from time to time be designated by written notice given as herein required:

---

| | |
|:---|:---|
| to Guarantor: | Transportation and Logistics Systems, Inc. |
|  | 5500 Military Trail, Suite 22-357 |
|  | Jupiter, FL 33458 |
|  | Email: [REDACTED] |
| to Shareholders: | Kathryn Boyd, as Shareholder Representative |
|  | [REDACTED] |
|  | Email: [REDACTED]; |

---

Personal delivery to a party or to any officer, partner, agent or employee of such party, or if a proper person, to a member of Guarantor's family, at Guarantor's address herein shall constitute receipt. Rejection or other refusal to accept or inability to deliver because of changed address of which no notice has been received shall also constitute receipt. Notwithstanding the foregoing, no notice of change of address shall be effective until the date of receipt thereof. This section shall not be construed in any way to affect or impair any waiver of notice or demand herein provided, or to require giving of notice or demand to or upon Guarantor in any situation or for any reason. Notwithstanding anything in this instrument to the contrary, all requirements of notice shall be deemed inapplicable if the Shareholders are prevented from giving such notice by bankruptcy or any other applicable law. In such event, the cure period, if any, shall then run from the occurrence of the event or condition of default rather than from the date of notice.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;15. Guarantor irrevocably and unconditionally: (a) agrees that any suit, action or other legal proceeding arising out of or relating to this Guaranty may be brought, at the option of the Shareholders, in a court of competent jurisdiction of the Commonwealth of Massachusetts or any United States District Court, with venue being proper in Middlesex County, Massachusetts; (b) consents to the jurisdiction of each such court in any such suit, action or proceeding; (c) waives any and all personal rights under the laws of any state to object to the laying of venue of any such suit, action or proceeding in Middlesex County, in the Commonwealth of Massachusetts; and (d) agrees that service of any court paper may be effected on Guarantor by mail, addressed and mailed as provided herein, or in such other manner as may be provided under applicable laws or court rules in the Commonwealth of Massachusetts. Nothing contained herein, however, shall prevent the Shareholders from bringing an action or exercising any rights against any security or against Guarantor personally, and against any property of Guarantor, within any other state. Initiating such proceeding or taking such action in any other state shall in no event constitute a waiver of the agreement contained herein that the laws of the Commonwealth of Massachusetts shall govern the rights and obligations of Guarantor and the Shareholders hereunder or of the submission herein made by Guarantor to personal jurisdiction within the Commonwealth of Massachusetts. The aforesaid means of obtaining personal jurisdiction and perfecting service of process are not intended to be exclusive but are cumulative and in addition to all other means of obtaining personal jurisdiction and perfecting service of process now or hereafter provided by the laws of the Commonwealth of Massachusetts.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;16. Capitalized terms used and not defined herein have the meanings given them in the Loan Documents.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;17. Guarantor represents and warrants to the Shareholders that (a) it has the power and authority, and the legal right, to execute, deliver and perform this Guaranty and (b) nothing exists to impair the effectiveness of the liability of Guarantor to the Shareholders hereunder, or the immediate taking effect of this Guaranty as the sole agreement between Guarantor and the Shareholders with respect to guaranteeing the Guaranteed Indebtedness. This Guaranty, when executed and delivered by Guarantor, will constitute the legal, valid and binding obligations of Guarantor enforceable in accordance with the terms hereof; that the execution, delivery and performance by Guarantor of this Guaranty will not violate any indenture, agreement or other instrument to which Guarantor is a party, or by which Guarantor or any of Guarantor's property is bound, or be in conflict with, result in a breach of, or constitute (with due notice or the lapse of time, or both) a default under any such indenture, agreement or other instrument, or result in the creation or imposition of any lien, charge or encumbrance of any nature whatsoever upon any of Guarantor's property or assets, except as contemplated by the provisions of this Guaranty; that there are no judgments outstanding against Guarantor and there is no action, suit, proceeding, or investigation now pending (or to the best of Guarantor's knowledge, after diligent inquiry, threatened) against, involving or affecting Guarantor or any of Guarantor's properties or any part thereof, at law, in equity or before any governmental authority that, if adversely determined as to Guarantor, would result in a material adverse change in the business or financial condition of Guarantor, or Guarantor's operation and ownership of any of Guarantor's properties, nor is there any basis for such action, suit, proceeding, or investigation; and that Guarantor is not insolvent and will not be rendered insolvent by the execution, delivery, payment and performance of this Guaranty.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;18. The liability of Guarantor hereunder shall be joint and several with the Debtor and with any other guarantor of the Guaranteed Indebtedness, if any.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;19. Guarantor has the power and authority, and the legal right, to own or lease and operate its property, and to carry on the business as now conducted and as proposed to be conducted, and to execute, deliver and perform this Guaranty. Guarantor has taken all necessary organizational action to authorize the execution, delivery and performance of the Guaranty. No consent or authorization of, filing with, notice to or other act by, or in respect of, any governmental authority or any other person is required in connection with the execution, delivery, performance, validity or enforceability of this Guaranty. This Guaranty constitutes a legal, valid and binding obligation of Guarantor, enforceable against Guarantor in accordance with its terms. The execution, delivery and performance of this Guaranty will not violate any law or any contractual obligation of Guarantor.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;20. <u>WAIVER OF TRIAL BY JURY</u>. GUARANTOR AND THE SHAREHOLDERS HEREBY MUTUALLY, KNOWINGLY, WILLINGLY, AND VOLUNTARILY WAIVE THEIR RIGHT TO TRIAL BY JURY AND AGREE THAT NO PARTY, NOR ANY ASSIGNEE, SUCCESSOR, HEIR, OR LEGAL REPRESENTATIVE OF THE PARTIES (ALL OF WHOM ARE HEREINAFTER REFERRED TO AS THE "PARTIES") SHALL SEEK A JURY TRIAL IN ANY LAWSUIT, PROCEEDING, COUNTERCLAIM, OR ANY OTHER LITIGATION PROCEEDING BASED UPON OR ARISING OUT OF THIS GUARANTY OR THE LOAN DOCUMENTS OR ANY INSTRUMENT EVIDENCING, SECURING, OR RELATING TO THE GUARANTEED INDEBTEDNESS OR OTHER OBLIGATIONS EVIDENCED HEREBY OR ANY RELATED AGREEMENT OR INSTRUMENT, ANY OTHER COLLATERAL FOR THE INDEBTEDNESS EVIDENCED HEREBY OR ANY COURSE OF ACTION, COURSE OF DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTION RELATING TO THIS GUARANTY. THE PARTIES ALSO WAIVE ANY RIGHT TO CONSOLIDATE ANY ACTION IN WHICH A JURY TRIAL HAS BEEN WAIVED WITH ANY OTHER ACTION IN WHICH A JURY TRIAL HAS NOT BEEN WAIVED. THE PROVISIONS OF THIS PARAGRAPH HAVE BEEN FULLY NEGOTIATED BY THE PARTIES. THE WAIVER CONTAINED HEREIN IS IRREVOCABLE, CONSTITUTES A KNOWING AND VOLUNTARY WAIVER, AND SHALL BE SUBJECT TO NO EXCEPTIONS. THE SHAREHOLDERS HAVE IN NO WAY AGREED WITH OR REPRESENTED TO GUARANTOR OR TO ANY OTHER PARTY THAT THE PROVISIONS OF THIS PARAGRAPH WILL NOT BE FULLY ENFORCED IN ALL INSTANCES.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

EXECUTED at ____________, ___________ County, New York, this 1st day of February, 2023.

---

| | |
|:---|:---|
| Transportation and Logistics Systems, Inc., a | Transportation and Logistics Systems, Inc., a |
| Nevada corporation | Nevada corporation |
| *By:* | */s/ Sebastian Giordano* |
| Name: | Sebastian Giordano |
| Title: | Chief Executive Officer |

---

## Exhibit 10.6

**Exhibit 10.6**

**<u>CONSULTING AGREEMENT</u>**

***THIS CONSULTING AGREEMENT*** (this "Agreement") is being made as of February 1, 2023 between ***Severance Trucking Co., Inc.,*** a Massachusetts corporation ("STI"), a wholly-owned subsidiary of TLSS-STI, Inc., a Delaware corporation ("TLSS-STI"), a wholly owned subsidiary of Transportation and Logistics Systems, Inc., a Nevada corporation (the "Corporation"), having its principal offices at 49 McGrath Road, Dracut, MA 01826, and ***Clyde J. Severance*** (the "Consultant") an individual with an address at [REDACTED].

***NOW, THEREFORE***, in consideration of the covenants and agreements herein contained, the parties hereto agree with each other as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. <u>Retention</u>. Subject to the terms and conditions of this Agreement, STI agrees to and does hereby retain Consultant to provide certain sales consulting services to STI.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. <u>Duties</u>. Consultant will personally provide sales consulting and related services and be available on average two (2) days per week during the "Term" (as hereinafter defined) of this Agreement. Consultant agrees to perform the services using Consultant's best efforts and to devote such time and effort to the performance of Consultant's duties as may be required. Consultant should provide regular updates and schedule meetings with STI's Chief Operating Officer (COO) as mutually agreed to help maximize STI's revenue and profit.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. <u>Term</u>. The term of this Agreement shall commence on February 1, 2023, and shall terminate at midnight on January 31, 2024 (the "Term"), unless terminated sooner pursuant to the terms hereof. Notwithstanding the foregoing: (i) STI may terminate this Agreement for any reason at any time after April 30, 2023 upon delivery of written notice of termination to the Consultant at least ten (10) days' prior to the noticed termination date; (ii) the Consultant may terminate this Agreement for any reason at any time after April 30, 2023 upon delivery of written notice of termination to STI at least ten (10) days' prior to the noticed termination date; and (iii) either party may terminate this Agreement for "Cause" or due to the death of Consultant, as set forth in Section 12 hereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4. <u>Consulting Fee</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) For the services rendered and performed by Consultant during the Term, STI agrees to pay Consultant a fee of Four Thousand (US $4,000) Dollars per month (the "Consulting Fee"), payable in accordance with STI's Accounts Payable (AP) practices. If this Agreement terminates in the middle of a month, the Consulting Fee for such month will be pro-rated through the date of such termination.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Subject to the limitations set forth herein, Consultant will be reimbursed for all out-of-pocket expenses reasonably and necessarily incurred by Consultant in connection with the performance of Consultant's services**,** including, but not limited to, meals and taxis while traveling on STI's business, payable within two (2) weeks following the submission by Consultant of expense reports to STI. Expense reports are to be submitted by Consultant to the COO of STI on a monthly basis. Consultant shall obtain written approval from the COO of STI prior to incurring expenses in excess of US $100.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5. <u>Relationship between the Parties</u>. Consultant is retained by STI only for the purpose and to the extent set forth in this Agreement and its relation to STI shall, during the Term of this Agreement, be that of an independent contractor and consultant and not as an employee. Consultant may not enter into any agreement, understanding or other commitment that is binding on STI or any of its affiliates, or hold Consultant out as having such authority. Consultant shall be free to dispose of such portion of his time, energy, and skill that Consultant is not obligated to devote to STI under this Agreement, in such manner as Consultant sees fit and to such persons, firms, or corporations as Consultant deems advisable, so long as Consultant complies with all terms and conditions of this Agreement. Consultant shall not be considered under this Agreement as having an employee status or as being entitled to participate in any plans, arrangements, or distributions by STI pertaining to or in connection with, any pension, stock, bonus, profit-sharing, or similar benefits which are or may be provided for its regular employees. Consultant and STI acknowledge and agree that (i) the services hereunder are not necessarily to be rendered at the offices of STI; (ii) there are no regular hours for the provision of such services; (iii) such services may not be a full-time obligation of Consultant; and (iv) Consultant may provide services to others during the term of this Agreement to the extent that the provision of such services is not contrary to the terms of Sections 7, 8 and 9 of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6. <u>Prior Agreements</u>. Consultant represents and warrants that Consultant is not subject to any confidentiality agreement, non-disclosure agreement, agreement not to compete or similar agreement that would in anyway restrict Consultant's activities on behalf of STI as contemplated in this Agreement, or which would otherwise expose STI to the risk of litigation from prior entities or companies for which Consultant was previously employed or to which Consultant provided services as an independent contractor. Consultant understands that the foregoing representation and warranty is a material inducement to STI to enter into this Agreement and retain Consultant and that any breach thereof constitutes grounds for immediate termination of this Agreement without further obligation or liability on the part of STI.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7. <u>Secrets</u>. Consultant agrees that any trade secrets or any other proprietary information relating to the business and/or field of interest of STI or any of its affiliates (for the purpose of this Agreement, an affiliate of STI shall be deemed to be any company or other legal entity which controls STI, which is controlled by STI, or is under common control with STI) or of any company or other legal entity in which STI or any of its affiliates has an ownership interest of more than twenty-five percent (25%), shall be regarded as held by Consultant in a fiduciary capacity solely for the benefit of STI, its successors or assigns, and shall not at any time, either during the term of this Agreement or thereafter, be disclosed, divulged, furnished, or made accessible by Consultant to anyone, or be otherwise used by Consultant, except in the regular course of business of the STI or its affiliates. Information shall, for purposes of this Agreement, be considered to be secret if not known by the trade generally, even though such information may have been disclosed to one or more third parties pursuant to distribution agreements, joint research agreements or other agreements entered into by STI or any of its affiliates.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8. <u>Patents</u>. Consultant agrees to and does hereby sell, assign, transfer and set over to STI, its successors, assigns, or affiliates, as the case may be, all its right, title, and interest in and to any inventions, improvements, processes, patents or applications for patents which it develops or conceives on its own or in conjunction with others during the Term, or, having possibly conceived same prior to the commencement of this Agreement, may complete during the Term, in both cases whether during or outside business hours, whether or not on STI's premises, in connection with any matters with which Consultant provides services to STI or any of its affiliates, to be held and enjoyed by STI, its successors, assigns or affiliates, as the case may be, to the full extent of the term for which any Letters Patent may be granted and as fully as the same would have been held by Consultant, had this Agreement, sale or assignment not been made. Consultant will make, execute and deliver any and all instruments and documents necessary to obtain patents for such inventions, improvements and processes in any and all countries. Consultant hereby irrevocably appoints STI to be Consultant's attorney in fact in the name of and on behalf of Consultant to execute all such instruments and do all such things and generally to use the Consultant's name for the purposes of assuring to STI (or its nominee) the full benefit of its rights under the provisions of Sections 7 and 8.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9. <u>Confidentiality; Non-Competition</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Except in connection with Consultant's engagement with STI, Consultant will not, directly or indirectly, use for Consultant or disclose to any other person or entity any confidential information concerning STI for any purpose whatsoever, without the prior written consent of the Board of Directors of STI. For purposes of this Agreement, "confidential information" shall not include information that: is or becomes a part of the public domain (other than by a breach of this Agreement), is or was rightfully received by Consultant from a third party not obligated to hold such information confidential; and/or is required by law to be disclosed. The provisions of this Section 9(a) shall survive termination of Consultant's engagement with STI.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) For a period of three (3) years from the earlier of the expiration of the Term and the termination of this Agreement, and within a one-hundred (100) mile radius of 49 McGrath Road, Dracut, MA 01826, Consultant shall not: (i) engage, directly or indirectly, whether as an individual, sole proprietor, or as a shareholder, member, partner, agent, officer, director, manager, employer, employee, consultant or independent contractor of any firm, corporation or other entity or group or otherwise in any "Competing Business", which for purposes of this Agreement, the term "Competing Business" shall mean any individual, sole proprietorship, partnership, firm, corporation or other entity or group which provides services for various clients in the trucking and warehousing industry and all related trucking and warehousing services thereto); (ii) whether as an individual or sole proprietor, or as a shareholder, member, partner, agent, officer, director, manager, employer, employee, consultant or independent contractor of any firm, corporation or other entity or group or otherwise, directly or indirectly, solicit the trade or business of, or trade, or conduct business with, any existing customer, prospective customer, existing supplier, or prospective supplier of STI for any purpose other than for the benefit of STI; or (iii) directly or indirectly, as an individual or sole proprietor, or as a shareholder, member, partner, agent, employee, employer, consultant, independent contractor, officer, director or manager of any person, firm, corporation or other entity or group or otherwise, without the prior express written consent of STI, approach, counsel or attempt to induce any person who is then in the employ of, or then serving as independent contractor for STI or its affiliates, to leave the employ of, or terminate such independent contractor relationship with STI or its affiliates or employ or attempt to employ any such person or persons who at any time during the six (6) months preceding such engagement was in the employ of, STI or its affiliates.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Notwithstanding the foregoing, nothing contained in this Agreement shall prohibit Consultant from purchasing and holding as an investment not more than 5% of any class of the issued and outstanding and publicly traded (on a recognized national or regional securities exchange or in the over-the-counter market) security of any corporation, partnership or other business entity that conducts a business in competition with STI and of which Consultant is not a consultant, employee, officer, or director. Furthermore, nothing herein shall prohibit Consultant from engaging in business activities with any existing customer, prospective customer, existing supplier, or prospective supplier of STI or its affiliates in connection with the Consultant's direct and indirect real estate holdings (the "RE Holding Companies"), provided the RE Holding Companies are not engaging in a Competing Business, which would include providing warehousing services (including leasing warehouse space) to clients of STI and its affiliates in the trucking and warehousing industry. Moreover, nothing in this Section shall prevent: (i) Consultant or Consultant's RE Holding Companies from hiring any former employee after ninety (90) days from the date of such former employee's resignation; (ii) the solicitation and hiring or engagement by advertisement of job openings by use of newspapers, magazines, the Internet and other media not directed at individual prospective employees; or (ii) the solicitation and hiring or engagement of any such person whose employment or engagement has been terminated by STI, provided the RE Holding Companies are not engaging in a Competing Business, which would include providing warehousing services to clients in the trucking and warehousing industry.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Consultant is agreeing to these provisions in consideration of the Agreement of STI to enter into the other provisions of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) Consultant acknowledges and agrees that the covenants contained in this Section 9 are fair and reasonable and of a special unique character which gives them peculiar value and STI would not have entered into this Agreement without such covenants being made. However, if any such covenants shall be determined by any court to be invalid by reason of their duration or geographical scope, such duration or geographic scope, or both, as the case may be, shall be considered to be reduced to the longest duration or greatest geographic scope, or both, which will cure such invalidity. Consultant further acknowledges that monetary damages alone will not be an adequate remedy for any breach by him of any of the covenants contained in this Section 9, and accordingly, Consultant expressly agrees that, in addition to all other remedies which STI has, STI shall be entitled to injunctive relief, both preliminary and permanent, in any court of competent jurisdiction and shall not be required to post a bond or other security in connection with any such action.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) Consultant acknowledges that the limitations set forth in this Section 9 shall not prevent Consultant from earning a livelihood after Consultant engagement with STI ends, but simply prevent unfair competition against STI for a limited period.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) The provisions of this Section 9 shall survive termination of Consultant's engagement with STI.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10. <u>Injunctive Relief for Breach; Enforceability</u>. Consultant agrees that in the event of a breach by Consultant of any of the covenants contained in Sections 7, 8 or 9, STI would suffer irreparable harm for which monetary damages may not be adequate compensation. Accordingly, Consultant agrees that in the event of any breach or threatened breach by Consultant of any of the covenants contained in Sections 7, 8 or 9, STI shall be entitled to injunctive relief (without the posting of a bond therefor) and specific performance in connection therewith, in addition to all other available remedies available to it, and Consultant will not claim as a defense thereto that STI has an adequate remedy at law. The parties hereto agree that the covenants and agreements contained in Section 7, 8 and 9 are, taken as a whole, reasonable in their scope and duration, and no party shall raise any issue of the reasonableness of the scope or duration of any such covenants in any proceeding to enforce any such covenants. Each of the covenants contained in this Sections 7, 8 and 9 shall be construed as separate covenants, and if any court shall finally determine that any of the restraints provided for in any such covenants are too broad as to the area, activity or time covered, said area, activity or time covered shall be deemed reduced to whatever extent the court deems reasonable and such covenants shall be enforced as to such reduced area, activity or time.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11. <u>Assignment</u>. This Agreement and any and all deliverables provided by Consultant to STI during the Term may be assigned by STI at any time, provided the assignee expressly assumes all obligations of STI under this Agreement. Further, this Agreement may be assigned by STI to an affiliate, provided that any such affiliate expressly assumes all obligations of STI under this Agreement, and provided further that STI fully guarantees the performance of this Agreement by such affiliate. Consultant agrees that if this Agreement is so assigned, all the terms and conditions of this Agreement shall remain between such assignee and Consultant with the same force and effect as if said Agreement had been made with such assignee in the first instance.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12. <u>Termination</u> of Consulting Services

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Survival</u>. The provisions of Sections 7, 8, 9 and 10 shall survive the termination of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Termination by Consultant</u>. If at any time during the Term, Consultant elects to terminate Consultant's services to STI pursuant to Section 3(ii), then STI's obligations to Consultant under this Agreement shall be limited to the portion of the Consulting Fee earned up to the date of Consultant's departure.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Termination for Cause</u>. This Agreement may be terminated by STI for "Cause" (as hereinafter defined). For purposes of this Agreement, "Cause" shall mean (i) the breach of Consultant's obligations under Sections 7, 8 or 9 of this Agreement, (ii) fraud or embezzlement from STI, (iii) Consultant's conviction of a felony; or (iv) Consultant's refusal or failure to carry out an assignment given to Consultant by STI under this Agreement. Termination for Cause must be accompanied by a written notice to that effect. In the event of termination for Cause, this Agreement shall immediately terminate and STI will have no further obligations under this Agreement, other than accrued and unpaid Consulting Fees owed to Consultant as of the date of termination for Cause.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) <u>Death of Consultant</u>. If Consultant dies, this Agreement shall terminate effective at the time of his death, provided, however, that such termination shall not result in the loss of any accrued and unpaid Consulting Fees owed to Consultant as of the date of Consultant's death.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13. <u>Entire Agreement</u>. This Agreement constitutes the entire agreement of Consultant and STI with respect to the subject matter hereof and supersedes all prior agreements, written and verbal, with respect to such subject matter.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14. <u>Amendment</u>. This Agreement may not be amended or supplemented unless in a written agreement signed by Consultant and STI.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;16. <u>Waiver</u>. No waiver of any provision of this Agreement shall be effective unless in writing and signed by the party to be charged therewith. No written waiver of any breach of any particular provision of this Agreement shall be effective as to any other provision of this Agreement or any subsequent breach of the same provision.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;17. <u>Severance</u>. In the event that any court of competent jurisdiction determines that any provision of this Agreement is unenforceable, the remainder of this Agreement shall not be effected thereby and shall remain in full force and effect, and the unenforceable provision shall be deemed modified to comply with law in such a manner so that it conforms to the fullest extent possible with the original intent of the parties.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;18. <u>Mutual Drafting</u>. This Agreement constitutes the joint product of the parties hereto. Each provision has been subject to the mutual consultation and agreement of such parties and shall not be construed for or against either of them.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;19. <u>Notices</u>. All notices required or permitted to be given hereunder shall be mailed by registered or certified mail, by overnight delivery or courier service, sent by email or by hand to the party to whom such notice is required or permitted to be given hereunder. If mailed, any such notice shall be deemed given no later than three (3) business days following the date of sending. If delivered by hand, any such notice shall be deemed given when received by the party to whom notice is given, as evidenced by written and dated receipt of the receiving party. If delivered by overnight delivery, any such notice shall be deemed given the next business day and if sent by email, such notice shall be deemed given at the time evidenced on the receipt thereof.

Any notice to Consultant shall be addressed as follows:

Clyde J. Severance

[REDACTED]

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(P) [REDACTED]

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(E) [REDACTED]

Any notice to STI shall be addressed as follows:

Severance Trucking Co., Inc.

Sebastian Giordano, CEO

5500 Military Trail

Suite 22-357

Jupiter, Florida 33458

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(P) [REDACTED]

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(E) [REDACTED]

Either party may change the address to which notice to it is to be addressed, by notice as provided herein.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;20. <u>Governing Law</u>. This Agreement shall be governed by, and construed in accordance with, the laws of the Commonwealth of Massachusetts, without giving effect to such Commonwealth's rules governing the conflicts of laws. Venue shall be in Middlesex County, Massachusetts.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;21. <u>Counterparts; Electronic Transmission</u>. This Agreement may be executed in any number of counterparts. All executed counterparts shall constitute one agreement notwithstanding that all signatories are not signatories to the original or the same counterpart. Any signature page delivered by email shall be binding to the same extent as an original signature page, with regard to any agreement subject to the terms hereof or any amendment thereto. Any party who delivers such a signature page agrees to later deliver an original counterpart to any party which requests it.

[*Signature Page Follows*]

IN WITNESS WHEREOF, the parties hereto have executed the above Agreement as of the day and year first above written.

---

| | |
|:---|:---|
| Consultant: | Consultant: |
| */s/ Clyde J. Severance* | */s/ Clyde J. Severance* |
| Clyde J. Severance | Clyde J. Severance |
| STI: | STI: |
| Severance Trucking Co., Inc., a Massachusetts corporation | Severance Trucking Co., Inc., a Massachusetts corporation |
| By: | */s/ Sebastian Giordano* |
| Name: | Sebastian Giordano |
| Title: | Chief Executive Officer |

---