# EDGAR Filing Document

**Accession Number:** 0000849145
**File Stem:** 0001193125-26-211813
**Filing Date:** 2026-5
**Character Count:** 423742
**Document Hash:** 5b862f203dabaa5b70dd35dd710bd8be
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001193125-26-211813.hdr.sgml**: 20260507

**ACCESSION NUMBER**: 0001193125-26-211813

**CONFORMED SUBMISSION TYPE**: 10-Q

**PUBLIC DOCUMENT COUNT**: 86

**CONFORMED PERIOD OF REPORT**: 20260331

**FILED AS OF DATE**: 20260507

**DATE AS OF CHANGE**: 20260507

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** Heritage Global Inc.
- **CENTRAL INDEX KEY:** 0000849145
- **STANDARD INDUSTRIAL CLASSIFICATION:** SERVICES-BUSINESS SERVICES, NEC [7389]
- **ORGANIZATION NAME:** 07 Trade & Services
- **EIN:** 592291344
- **STATE OF INCORPORATION:** FL
- **FISCAL YEAR END:** 1231

**FILING VALUES:**
- **FORM TYPE:** 10-Q
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 001-39471
- **FILM NUMBER:** 26952917

**BUSINESS ADDRESS:**
- **STREET 1:** 6130 NANCY RIDGE DRIVE
- **CITY:** SAN DIEGO
- **STATE:** CA
- **ZIP:** 92121
- **BUSINESS PHONE:** 858-847-0655

**MAIL ADDRESS:**
- **STREET 1:** 6130 NANCY RIDGE DRIVE
- **CITY:** SAN DIEGO
- **STATE:** CA
- **ZIP:** 92121

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** Counsel RB Capital Inc.
- **DATE OF NAME CHANGE:** 20110121

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** C2 Global Technologies Inc
- **DATE OF NAME CHANGE:** 20050812

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** ACCERIS COMMUNICATIONS INC
- **DATE OF NAME CHANGE:** 20040220

?xml version='1.0' encoding='ASCII'? 10-Q

------

**UNITED STATES**

**SECURITIES AND EXCHANGE COMMISSION**

**WASHINGTON, D.C. 20549**

**FORM** 10-Q

&nbsp;&nbsp;&nbsp;&nbsp;☒ **QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934** 

**For the quarterly period ended** **March 31,** 2026

**OR**

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

**For the transition period from to**

**Commission file number:** 001-39471

![img160171482_0.jpg](img160171482_0.jpg)

HERITAGE GLOBAL INC.

**(Exact name of registrant as specified in its charter)**

---

| | |
|:---|:---|
| Florida | 59-2291344 |
| **(State or Other Jurisdiction of<br>Incorporation or Organization)** | **(I.R.S. Employer Identification No.)** |

---

6130 Nancy Ridge Drive**,** San Diego**,** CA 92121

**(Address of Principal Executive Offices)**

**(**858**)** 847-0659

**(Registrant's Telephone Number)**

**N/A**

**(Registrant's Former Name)**

Securities registered pursuant to Section 12(b) of the Act:

**<u>Title of each class</u> <u>Trading Symbol(s)</u> <u>Name of each exchange on which registered</u>**

Common stock, $0.01 par value HGBL The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.

---

| | | | |
|:---|:---|:---|:---|
| Large Accelerated Filer | ☐ | Accelerated Filer | ☐ |
| Non-Accelerated Filer | ☒ | Smaller reporting company | ☒ |
|  |  | 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. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date:

As of May 1, 2026, there were 34,734,754 shares of common stock outstanding, $0.01 par value.

------

**TABLE OF CONTENTS**

---

| | | |
|:---|:---|:---|
| **<u>Part I.</u>** | [**<u>Financial Information</u>**](#part_i_financial_information) |  |
| Item 1. | [<u>Financial Statements</u>](#item_1_financial_statements) | 3 |
|  | &nbsp;&nbsp;&nbsp;&nbsp;[<u>Condensed Consolidated Balance Sheets as of March 31, 2026 (unaudited) and December 31, 2025</u>](#condensed_consolidated_balance_sheets) | 3 |
|  | &nbsp;&nbsp;&nbsp;&nbsp;[<u>Condensed Consolidated Statements of Income for the three months ended March 31, 2026 and 2025 (unaudited)</u>](#condensed_consolidated_statements_operat) | 4 |
|  | &nbsp;&nbsp;&nbsp;&nbsp;[<u>Condensed Consolidated Statements of Stockholders' Equity for the three months ended March 31, 2026 and 2025 (unaudited)</u>](#condensed_consolidated_statement_stockho) | 5 |
|  | &nbsp;&nbsp;&nbsp;&nbsp;[<u>Condensed Consolidated Statements of Cash Flows for the three months ended March 31, 2026 and 2025 (unaudited)</u>](#condensed_consolidated_statements_cash_f) | 6 |
|  | [<u>Notes to Unaudited Condensed Consolidated Financial Statements</u>](#notes_to_unaudited_condensed_consolidate) | 7 |
| Item 2. | [<u>Management's Discussion and Analysis of Financial Condition and Results of Operations</u>](#item_2_managements_discussion_analysis_f) | 26 |
| Item 3. | <u>Quantitative and Qualitative Disclosures About Market Risk</u> | 36 |
| Item 4. | <u>Controls and Procedures</u> | 36 |
| **<u>Part II.</u>** | [**<u>Other Information</u>**](#part_ii_or_information) |  |
| Item 1.  | [<u>Legal Proceedings</u>](#item_1_legal_proceedings) | 37 |
| Item 1A. | [<u>Risk Factors</u>](#item_1a_risk_factors) | 37 |
| Item 2. | [<u>Unregistered Sales of Equity Securities and Use of Proceeds</u>](#item_2_unregistered_sales_equity_securit) | 37 |
| Item 3. | [<u>Defaults Upon Senior Securities</u>](#item_3_defaults_upon_senior_securities) | 37 |
| Item 4. | [<u>Mine Safety Disclosures</u>](#item_4_mine_safety_disclosures) | 37 |
| Item 5. | [<u>Other Information</u>](#item_5_or_information) | 37 |
| Item 6. | [<u>Exhibits</u>](#item_6_exhibits) | 38 |
|  | [<u>Signature Page</u>](#signatures) | 39 |

---

------

**PART I – FINANCI** **AL INFORMATION**

**Item 1 – Financial Statements.**

**HERITAGE GLOBAL INC.**

**CONDENSED CONSOLIDATED BALANCE SHEETS**

**(In thousands of US dollars, except share and per share amounts)** 

---

| | | |
|:---|:---|:---|
|  | **March 31, 2026** | **December 31, 2025** |
| ASSETS | **(unaudited)** |  |
| Current assets: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Cash and cash equivalents | $11566 | $20522 |
| &nbsp;&nbsp;&nbsp;&nbsp;Accounts receivable, net | 1725 | 1857 |
| &nbsp;&nbsp;&nbsp;&nbsp;Current portion of notes receivable, net | 4369 | 4528 |
| &nbsp;&nbsp;&nbsp;&nbsp;Inventory – equipment | 5348 | 5931 |
| &nbsp;&nbsp;&nbsp;&nbsp;Other current assets | 755 | 756 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total current assets | 23763 | 33594 |
| &nbsp;&nbsp;Non-current portion of notes receivable, net | 4182 | 4893 |
| &nbsp;&nbsp;Equity method investments | 19442 | 21060 |
| &nbsp;&nbsp;Property and equipment, net | 12029 | 10884 |
| &nbsp;&nbsp;Right-of-use assets | 1339 | 1518 |
| &nbsp;&nbsp;Intangible assets, net | 6066 | 3100 |
| &nbsp;&nbsp;Goodwill | 12747 | 7446 |
| &nbsp;&nbsp;Deferred tax assets | 4486 | 4402 |
| &nbsp;&nbsp;Other assets | 935 | 1542 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total assets | $84989 | $88439 |
| LIABILITIES AND STOCKHOLDERS' EQUITY |  |  |
| Current liabilities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Accounts payable and accrued liabilities | $5174 | $6487 |
| &nbsp;&nbsp;&nbsp;&nbsp;Payables to sellers | 5317 | 7273 |
| &nbsp;&nbsp;&nbsp;&nbsp;Current portion of lease liabilities | 818 | 829 |
| &nbsp;&nbsp;&nbsp;&nbsp;Other current liabilities | 896 | 948 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total current liabilities | 12205 | 15537 |
| &nbsp;&nbsp;Non-current portion of third party debt | 4100 | 4100 |
| &nbsp;&nbsp;Non-current portion of lease liabilities | 619 | 790 |
| &nbsp;&nbsp;Other non-current liabilities | 295 | 1029 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total liabilities | 17219 | 21456 |
| Stockholders' equity: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Preferred stock, $10.00 par value, authorized 10,000,000 shares; issued and outstanding 563 of Series N as of March 31, 2026 and December 31, 2025; with liquidation preference over common stockholders equivalent to $1,000 per share | 6 | 6 |
| &nbsp;&nbsp;&nbsp;&nbsp;Common stock, $0.01 par value, authorized 300,000,000 shares; issued 37,739,211 and 37,639,211 shares as of March 31, 2026 and December 31, 2025, respectively; and outstanding 34,734,754 and 34,741,553 shares as of March 31, 2026 and December 31, 2025, respectively | 377 | 376 |
| &nbsp;&nbsp;&nbsp;&nbsp;Additional paid-in capital | 296687 | 296477 |
| &nbsp;&nbsp;&nbsp;&nbsp;Accumulated deficit | (223540) | (224257) |
| &nbsp;&nbsp;&nbsp;&nbsp;Treasury stock at cost, 3,004,457 and 2,897,658 shares as of March 31, 2026 and December 31, 2025, respectively | (5760) | (5619) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total stockholders' equity | 67770 | 66983 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total liabilities and stockholders' equity | $84989 | $88439 |

---

The accompanying notes are an integral part of these condensed consolidated unaudited financial statements.

------

**HERITAGE GLOBAL INC.**

**CONDENSED CONSOLIDATED STATEMENTS OF INCOME**

 **(In thousands of US dollars, except share and per share amounts)**

**(unaudited)**

---

| | | |
|:---|:---|:---|
|  | **Three Months Ended March 31,** | **Three Months Ended March 31,** |
|  | **2026** | **2025** |
| Revenues: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Services revenue | $6911 | $7648 |
| &nbsp;&nbsp;&nbsp;&nbsp;Asset sales | 5814 | 5811 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total revenues | 12725 | 13459 |
| Operating costs and expenses: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Cost of services revenue | 1052 | 1675 |
| &nbsp;&nbsp;&nbsp;&nbsp;Cost of asset sales | 3375 | 3773 |
| &nbsp;&nbsp;&nbsp;&nbsp;Selling, general and administrative | 7619 | 6534 |
| &nbsp;&nbsp;&nbsp;&nbsp;Depreciation and amortization | 174 | 118 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total operating costs and expenses | 12220 | 12100 |
| &nbsp;&nbsp;&nbsp;&nbsp;Earnings of equity method investments | 503 | 44 |
| Operating income | 1008 | 1403 |
| Interest (expense) income, net | (20) | 56 |
| Income before income tax expense | 988 | 1459 |
| Income tax expense | 271 | 395 |
| Net income | $717 | $1064 |
| Weighted average common shares outstanding – basic | 34596265 | 35282855 |
| Weighted average common shares outstanding – diluted | 34991982 | 36056645 |
| Net income per share – basic | $0.02 | $0.03 |
| Net income per share – diluted | $0.02 | $0.03 |

---

The accompanying notes are an integral part of these condensed consolidated unaudited financial statements.

------

**HERITAGE GLOBAL INC.**

**CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY**

 **(In thousands of US dollars, except share amounts) (unaudited)**

---

| | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  |  |  |  |  | **Additional** |  |  |  |  |
|  | **Preferred stock** | **Preferred stock** | **Common stock** | **Common stock** | **paid-in** | **Accumulated** | **Treasury stock** | **Treasury stock** |  |
|  | **Shares** | **Amount** | **Shares** | **Amount** | **capital** | **deficit** | **Shares** | **Amount** | **Total** |
| **Balance as of December 31, 2025** | 563 | $6 | 37639211 | $376 | $296477 | $(224257) | 2897658 | $(5619) | $66983 |
| Issuance of restricted common stock |  |  | 100000 | 1 | (1) |  |  |  |  |
| Stock-based compensation expense |  |  |  |  | 211 |  |  |  | 211 |
| Repurchase of common stock |  |  |  |  |  |  | 106799 | (141) | (141) |
| Net income |  |  |  |  |  | 717 |  |  | 717 |
| **Balance as of March 31, 2026** | 563 | $6 | 37739211 | $377 | $296687 | $(223540) | 3004457 | $(5760) | $67770 |

---

---

| | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  |  |  |  |  | **Additional** |  |  |  |  |
|  | **Preferred stock** | **Preferred stock** | **Common stock** | **Common stock** | **paid-in** | **Accumulated** | **Treasury stock** | **Treasury stock** |  |
|  | **Shares** | **Amount** | **Shares** | **Amount** | **capital** | **deficit** | **Shares** | **Amount** | **Total** |
| **Balance as of December 31, 2024** | 563 | $6 | 37380944 | $374 | $295657 | $(227844) | 1662583 | $(2992) | $65201 |
| Issuance of restricted common stock |  |  | 256822 | 2 | (79) |  |  |  | $(77) |
| Stock-based compensation expense |  |  |  |  | 280 |  |  |  | $280 |
| Repurchase of common stock |  |  |  |  |  |  | 490651 | (1042) | $(1042) |
| Net income |  |  |  |  |  | 1064 |  |  | $1064 |
| **Balance as of March 31, 2025** | 563 | $6 | 37637766 | $376 | $295858 | $(226780) | 2153234 | $(4034) | $65426 |

---

The accompanying notes are an integral part of these condensed consolidated unaudited financial statements.

------

**HERITAGE GLOBAL INC.**

**CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS**

**(In thousands of US dollars) (unaudited)**

---

| | | |
|:---|:---|:---|
|  | **March 31,** | **March 31,** |
|  | **2026** | **2025** |
| **Cash flows from operating activities:** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Net income | $717 | $1064 |
| &nbsp;&nbsp;&nbsp;&nbsp;Adjustments to reconcile net income to net cash (used in) provided by operating<br> activities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amortization of deferred issuance costs and fees, net | (4) | (13) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Earnings of equity method investments | (503) | (44) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Noncash credit loss recovery | (21) | (4) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amortization of right-of-use assets | 179 | 167 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Depreciation and amortization | 174 | 118 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Deferred taxes | (84) | 285 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Stock-based compensation expense | 211 | 280 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Changes in operating assets and liabilities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts receivable | 134 | (101) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Inventory – equipment | 583 | 267 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other current assets | 68 | 515 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts payable and accrued liabilities | (1937) | (901) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Payables to sellers | (1956) | 1151 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Lease liabilities | (182) | (167) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other current liabilities | (58) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net cash (used in) provided by operating activities | (2679) | 2617 |
| **Cash flows from investing activities:** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Investment in notes receivable | (1048) | (1348) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Payments received on notes receivable | 1940 | 1609 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Acquisition | (8460) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Investment in participating interest |  | (1575) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Return of investment in participating interest | 607 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Investment in equity method investments |  | (1575) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Return of investment in equity method investments | 1618 | 776 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Cash distributions from equity method investments | 503 | 44 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Purchase of property and equipment | (562) | (7408) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net cash used in investing activities | (5402) | (9477) |
| **Cash flows from financing activities:** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Proceeds from debt payable to third parties | 1000 | 4100 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Repayment of debt payable to third parties | (1000) | (130) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Proceeds from secured borrowing |  | 1050 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Repayments of secured borrowing | (734) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Payments of tax withholdings related to issuance of restricted common stock and stock option awards |  | (79) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Repurchase of common stock | (141) | (1042) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net cash (used in) provided by financing activities | (875) | 3899 |
| Net change in cash and cash equivalents | (8956) | (2961) |
| Cash and cash equivalents as of beginning of period | 20522 | 21749 |
| Cash and cash equivalents as of end of period | $11566 | $18788 |
| **Supplemental cash flow information:** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Cash paid (received) for taxes | $307 | $(9) |
| &nbsp;&nbsp;&nbsp;&nbsp;Cash paid for interest, net of amounts capitalized | $23 | $— |
| &nbsp;&nbsp;&nbsp;&nbsp;Noncash purchase of property and equipment | $627 | $49 |

---

The accompanying notes are an integral part of these condensed consolidated unaudited financial statements.

------

**HERITAGE GLOBAL INC.**

**NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**(unaudited)**

**Note 1 –Basis of Presentation**

These unaudited condensed consolidated interim financial statements include the accounts of Heritage Global Inc. ("HG") together with its subsidiaries, including Heritage Global Partners, Inc. ("HGP"), National Loan Exchange Inc. ("NLEX"), Heritage Global LLC ("HG LLC"), Heritage Global Capital LLC ("HGC"), Heritage ALT LLC ("ALT"), and Heritage DebtX LLC ("DebtX"). These entities, collectively, are referred to as "the Company," "us" "we" or "our" in these condensed consolidated financial statements. These condensed consolidated financial statements were prepared in conformity with generally accepted accounting principles in the United States of America ("GAAP"), as outlined in the Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") and include the assets, liabilities, revenues, and expenses of all subsidiaries over which HG exercises control. All significant intercompany accounts and transactions have been eliminated upon consolidation.

The Company began its operations in 2009 with the establishment of HG LLC. The business was subsequently expanded by the acquisitions of HGP in 2012, NLEX in 2014, ALT in 2021, and DebtX in 2026, and the creation of HGC in 2019. As a result, HG is positioned to provide an array of value-added capital and financial asset solutions: auction and appraisal services, traditional asset disposition sales, and specialty financing solutions. The Company's reportable segments consist of (1) Auction and Liquidation through HGP, (2) Refurbishment & Resale through ALT, (3) Consumer Loans through NLEX, (4) Specialty Lending through HGC, and (5) Commercial Loans through DebtX.

The Company prepared the unaudited condensed consolidated interim financial statements included herein pursuant to the rules and regulations of the United States Securities and Exchange Commission (the "SEC"). In the opinion of management, these unaudited condensed financial statements reflect all adjustments that are necessary to present fairly the results for the interim periods included herein. Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations; however, the Company believes that the disclosures are appropriate. These unaudited condensed consolidated interim financial statements should be read in conjunction with the audited consolidated financial statements and the notes thereto included in the Company's Annual Report on Form 10-K for the year ended December 31, 2025, filed with the SEC on March 12, 2026 (the "Form 10-K").

The results of operations for the interim periods are not necessarily indicative of those operating results to be expected for any subsequent interim period or for the entire year ending December 31, 2026. The accompanying condensed consolidated balance sheet as of December 31, 2025 has been derived from the audited consolidated balance sheet as of December 31, 2025, contained in the Company's Form 10-K.

***Repurchase Program***

The Company's Board of Directors previously authorized a share repurchase program ("2022 Repurchase Program"), which permitted the Company to purchase up to an aggregate of $6.0 million in common shares over a three year period. The 2022 Repurchase Program ended on June 30, 2025, with the Company utilizing approximately $5.6 million of the authorized $6.0 million for the repurchase of 2,897,658 common shares in the open market.

Following the expiration of the 2022 Repurchase Program, the Company's Board of Directors authorized a new share repurchase program (the "2025 Repurchase Program") on July 31, 2025. The 2025 Repurchase Program authorizes the repurchase of up to $7.5 million of the Company's outstanding common stock through June 30, 2028. The timing and actual number of shares repurchased will depend on various factors, including share price, general business and market conditions, and the opportunities within the Company's operations. The Company repurchased 106,799 shares under the 2025 Repurchase Program for a purchase price of approximately $0.1 million during the three months ended March 31, 2026. As of March 31, 2026, the Company had approximately $7.4 million in aggregate dollar value of shares that may be purchased under the 2025 Repurchase Program.

------

**Note 2 – Summary of Significant Accounting Policies**

***Use of estimates***

The preparation of the Company's unaudited condensed consolidated interim financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements, as well as the reported amounts of revenues and expenses during the reporting period. Management bases its estimates and judgments on historical experience and various other factors that are believed to be reasonable under the circumstances. Actual results could differ from those estimates.

Significant estimates include the assessment of collectability of revenue recognized and the valuation of accounts receivable and notes receivable, inventory, investments, goodwill and intangible assets, liabilities, deferred income tax assets and liabilities, including projecting future years' taxable income, and stock-based compensation. These estimates have the potential to significantly impact our condensed consolidated interim financial statements, either because of the significance of the financial statement item to which they relate, or because they require judgment and estimation due to the uncertainty involved in measuring, at a specific point in time, events that are continuous in nature.

***Revenue recognition*** 

The Company recognizes revenue in accordance with ASC Topic 606, *Revenue from Contracts with Customers* ("ASC 606") and ASC Topic 310, *Receivables* ("ASC 310").

Services revenue generally consists of commissions and fees from providing auction services, appraisals, brokering of sales transactions, and secured lending. Asset sales revenue generally consists of proceeds obtained through sales of purchased assets. With the exception of revenue generated within our Specialty Lending segment, revenue is recognized for both services revenue and asset sales revenue based on the ASC 606 standard recognition model, which consists of the following: (1) an agreement exists between two or more parties that creates enforceable rights and obligations, (2) the performance obligations are clearly identified, (3) the transaction price has been determined, (4) the transaction price has been properly allocated to each performance obligation, and (5) the entity satisfies a performance obligation by transferring a promised good or service to a customer for each of the entities.

All services and asset sales revenue from contracts with customers consists of four reportable segments: Auction and Liquidation, Refurbishment & Resale, Consumer Loans and Commercial Loans. Generally, revenue is recognized at the point in time in which the performance obligation has been satisfied and full consideration is received. The exception to recognition at a point in time occurs when certain contracts provide for advance payments recognized over a period of time. Services revenue recognized over a period of time is not material in comparison to total revenues (less than 1% of total revenues for the three months ended March 31, 2026 and 2025), and therefore not reported on a disaggregated basis. Further, as certain contracts stipulate that the customer make advance payments, amounts not recognized within the reporting period are considered deferred revenue and the Company's "contract liability". The deferred revenue balance was approximately $0.9 million as of both March 31, 2026 and December 31, 2025, respectively, and is reflected in accounts payable and accrued liabilities on the condensed consolidated balance sheets. The deferred revenue balance is primarily related to customer deposits on asset sales within the Refurbishment & Resale segment. The Company records receivables in certain situations based on timing of payments for Auction and Liquidation transactions held at the end of the reporting period; however, revenue is generally recognized in the period that the Company satisfies the performance obligation and cash is collected. The Company does not record a "contract asset" for partially satisfied performance obligations.

For auction services and consumer loan sale transactions, funds are typically collected from buyers and are held by the Company on the seller's behalf. The funds are included in cash and cash equivalents in the condensed consolidated balance sheets. The Company releases the funds to the seller, less the Company's commission and other fees due, after the buyer has accepted the goods. The amount of cash held on behalf of the sellers is recorded as payables to sellers in the accompanying condensed consolidated balance sheets.

For commercial loan sale transactions, funds are not held by the Company on the seller's behalf. The Company's commission and other fees due from the seller are generally recognized at the time the sale transaction is closed and the invoice is issued.

The Company evaluates revenue from Auction and Liquidation, Consumer Loans and Commercial Loans segment transactions in accordance with the accounting guidance to determine whether to report such revenue on a gross or net basis. The Company has determined that it acts as an agent for its fee based transactions and therefore reports the revenue from transactions in which the Company acts as an agent on a net basis.

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The Company also earns income through transactions that involve the Company acting jointly with one or more additional purchasers or lenders, pursuant to a partnership, joint venture or limited liability company agreement (collectively, "Joint Ventures"). For these transactions, in which the Company's ownership share meets the criteria for the equity method investments under ASC Topic 323, *Equity Method and Joint Ventures*, the Company does not record revenue or expense. Instead, the Company's proportionate share of the net income (loss) is reported as earnings of equity method investments. In general, the Joint Ventures apply the same revenue recognition and other accounting policies as the Company.

Through its Specialty Lending segment, the Company provides specialty financing solutions to investors in charged-off and nonperforming asset portfolios. The Company recognizes revenue generated by lending activity in accordance with ASC 310. Fees collected in relation to the issuance of loans include loan origination fees, interest income, portfolio monitoring fees, and a backend profit share percentage related to the underlying asset portfolio.

The monitoring fees and the backend profit share are considered a separate earnings process as compared to the origination fees and interest income. Monitoring fees are recorded at the agreed upon rate, and at the moment in which payments are made by the borrower. The backend profit share is recognized in accordance with the agreed upon rate at the time in which the amount is realizable and earned. The recognition policy was established due to the uncertainty of timing of the receipt of backend profit share and the amount of backend profit share which will be realized.

Through its Refurbishment and Resale segment, the Company offers financing on its standard laboratory equipment sales. The Company recognizes revenue upon shipment of its financed products in accordance with ASC 606. The Company records a loan receivable for the unpaid balance of the order. A loan amortization table is created upon shipment outlining the principal and interest income portion of each future payment. These loans are classified as held-for-investment and accounted for under the guidelines of ASC 310.

For both the Specialty Lending and Refurbishment and Resale segments, loan origination fees are offset with any direct origination costs and are deferred upon issuance of the loan and amortized over the lives of the related loans, as an adjustment to interest income. The interest method is used to arrive at a periodic interest cost (including amortization) that will represent a level effective rate on the sum of the face amount of the debt and (plus or minus) the unamortized premium or discount and expense at the beginning of each period.

***Nonaccrual Loans***

The Company determines a loan to be in a default status when the minimum payment amount has not been received within the grace period of the payment due date. The status of default does not solely trigger nonaccrual loan status. The Company considers quantitative and qualitative factors when evaluating a loan in default status to determine the likelihood of recovering the outstanding principal balance and contractual interest payments. The Company also monitors its borrowers' financial standing and performance on an ongoing basis and regularly updates the collection forecasts for the underlying charged off or nonperforming receivable portfolios related to each outstanding loan. If management determines (1) it is not probable that the projected cash flows expected from the borrower's collection efforts on the underlying charged off or nonperforming receivable portfolio will be sufficient to satisfy all of the outstanding principal balance and contractual interest payments, and (2) it is not probable that the borrower will be able to meet the minimum required principal and interest payments through other operational cash flows, the Company will place the loans on nonaccrual status. If, based on its analysis, the Company elects to maintain accrual status after initial payment default, the loan will generally be placed on nonaccrual status if principal or interest payments become 90 days past due.

The accrual of interest is generally discontinued when a loan is placed in nonaccrual status. Interest received on such loans is accounted for using the cost-recovery or the cash-basis method, until qualifying for return to accrual. Under the cost-recovery method, interest income is not recognized until the loan balance is reduced to zero. Under the cash-basis method, interest payments received by the creditor are recorded as interest income provided the amount does not exceed the amount that would have been earned at the loan's original effective interest rate. Loans are returned to accrual status when all the principal and interest amounts contractually due are brought current, there is a sustained period of repayment performance, and all remaining principal and interest payments are deemed probable.

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Pursuant to the terms of existing credit agreements, the Company's largest borrower was required to collect on underlying charged off and nonperforming consumer loan portfolios and remit a required minimum monthly payment to the Company. However, this borrower became unable to make the required minimum monthly payments beginning in June 2024 and therefore is in default. The Company's largest borrower continues to collect on the underlying charged off and nonperforming consumer loan portfolios and remit net collections to the Company and senior lenders. The Company has determined (1) it is not probable that the projected cash flows expected from the borrower's collection efforts on the underlying charged off or nonperforming receivable portfolio will be sufficient to satisfy all of the outstanding principal balance and contractual interest payments, and (2) it is not probable that the borrower will be able to meet the minimum required principal and interest payments through other operational cash flows. While the Company continues to work closely with the borrower and its senior lenders in an effort to mitigate the default in an efficient and effective manner, the impacted loans were placed in nonaccrual status in June 2024. In addition, there was a balance of $1.5 million from the Company's share of other loans within its affiliated joint ventures that are impacted by the default with the largest borrower and were placed in nonaccrual status in June 2024. The Company's share of payments received from the nonaccrual loans, including interest, will be applied against the outstanding loan balance. As of March 31, 2026, the amortized cost basis of loans in nonaccrual status was $23.7 million, of which $4.8 million is recorded within notes receivable and $18.9 million is recorded within equity method investments.

The Company, in coordination with senior lenders, is actively engaged in a workout process with respect to loans currently in nonaccrual status, with the objective of maximizing recoveries over the remaining economic life of the underlying collateral. Its recovery strategy is centered on the monetization of the charged-off and nonperforming consumer receivable portfolios securing these loans and is expected to occur over multiple years. The primary component of the workout strategy involves transitioning a greater portion of the underlying consumer accounts into legal collection channels. During the fourth quarter of 2025, the Company reached a restructuring agreement with the senior lender for HGC MPG Funding LLC. As a result of this restructuring agreement and the Company's regular quarterly portfolio analysis, the Company has determined it appropriate to place all loans associated with its joint ventures with senior lenders in nonaccrual status given the senior lender's priority position in cash flows generated from the underlying portfolios. As of both March 31, 2026 and December 31, 2025, the balance of the additional loans placed in nonaccrual status was approximately $1.7 million.

***Specialty Lending - Concentration and credit risk***

As of March 31, 2026, the Company held a gross balance of investments in notes receivable of $27.3 million, recorded in both notes receivable and equity method investments. The Company's portfolio includes its largest borrower's gross note receivable balance of approximately $21.4 million, representing 78% of our total gross notes receivable balance as of March 31, 2026, as compared to 76% as of December 31, 2025. As discussed further in Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations – Nonaccrual Loans, our largest borrower is in default. As a result, the balance of the loans outstanding with our largest borrower were in nonaccrual status as of March 31, 2026. Whether we will realize any return with respect to the impacted loans is uncertain.

The Company does not evaluate concentration risk solely based on balance due from specific borrowers, but also considers the number of portfolio purchases, type of charged off accounts within the portfolio, and the seller of the portfolio when determining the overall risk. Of the balance due from one borrower of $21.4 million, there are 11 distinct loan agreements. The underlying portfolio of accounts are diversified throughout FinTech loans, installment loans and credit card accounts, and further diversified amongst six separate sellers of these charged off portfolios.

The Company mitigates this concentration risk by requiring, and monitoring, security from each borrower consisting of their charged off and nonperforming receivable portfolios. The Company engages in a due diligence process that leverages its valuation expertise, knowledge and experience in the underlying nonperforming receivable portfolios marketplace. In the event of default, the Company is entitled to call the unpaid interest and principal balances and receive all net collections directly. The Company may also recover its investment by engaging a third party to collect on the underlying charged off or nonperforming receivable portfolio or the underlying portfolio can be sold through the Company's Consumer Loan segment. In certain cases, the Company's recovery options are subject to concurrence of the originator or other prior holder of the assets.

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***Allowance for credit losses***

The Company applies a current expected credit loss model, which is an impairment model based on expected losses rather than incurred losses. The expected credit losses, and subsequent adjustments to such losses, are recorded through an allowance account that is deducted from, or added to, the amortized cost basis of the financial asset, with the net carrying value of the financial asset presented on the consolidated balance sheet at the amount expected to be collected.

The table below summarizes the allowance for credit loss balance as of, and the changes made during the years ending December 31, 2025 and 2024 and the three months ended March 31, 2026, respectively (in thousands):

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| | | | | |
|:---|:---|:---|:---|:---|
|  | **Accounts Receivable** | **Notes Receivable** | **Equity Method Investments** | **Total** |
| Balance as of December 31, 2024 | $132 | $383 | $986 | $1501 |
| (Recovery) provision for credit losses | 23 | (43) | 5 | (15) |
| Balance as of December 31, 2025 | 155 | 340 | 991 | 1486 |
| (Recovery) provision for credit losses | (2) | (19) | 6 | (15) |
| **Balance as of March 31, 2026** | $153 | $321 | $997 | $1471 |

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**Accounts receivable**

The Company carries accounts receivable at the face amounts less an allowance for estimated credit losses. The Company estimates its reserve for credit losses using relevant available information from internal and external sources relating to past events, current conditions and reasonable and supportable forecasts.

The Company only extends credit to entities and institutions of significance, such as well-known academic and financial institutions and U.S. government agencies. Consequently, historical accounts receivable credit losses are nearly zero, which provides the starting point for management's assessment of the reserve for credit losses for its accounts receivable. The Company estimates its expected credit losses for accounts receivable based on historical credit loss experience, its assessment of current conditions, and other relevant available information from internal and external sources on a quarterly basis.

As of both March 31, 2026 and December 31, 2025, the reserve for credit losses related to accounts receivable was approximately $0.2 million.

**Notes receivable**

Under ASC 326, the Company evaluates notes receivable as a single pool, for individual notes receivable and borrowers with similar risk characteristics. Notes receivable and borrowers that do not share risk characteristics are evaluated on an individual basis. Management evaluates the Company's notes receivables related to financing laboratory equipment sales within the notes receivable pool. Management estimates the reserve balance using relevant available information from internal and external sources relating to past events, current conditions and reasonable and supportable forecasts. Historical credit loss experience typically provides the basis for an estimation of expected credit losses; however, the Company lacks sufficient data upon which to base a historical estimation. Additionally, since the Company began recording notes receivable on the condensed consolidated balance sheets, the Company has recorded no actual credit losses to notes receivable.

Lacking historical internal data upon which to base a reserve for credit losses to notes receivable, the Company, under ASC 326, estimates its reserve using external credit loss experience data. Management observes that the Company's notes receivable are similar in character to transactions undertaken by smaller banking institutions. The Company estimates its expected credit losses based on the Scaled Current Expected Credit Loss (CECL) Allowance Loss Estimator ("SCALE rate") available from the Federal Reserve. The SCALE rate methodology is endorsed by the FASB and the Conference of State Bank Supervisors. Management determined under ASC 326 that the SCALE rate, a generally applicable rate, may be appropriately adjusted by its assessment of observable facts and relevant circumstances indicating that the factors analyzed in the determination of the SCALE rate may not conform to the Company's operations and borrower assessments.

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As of March 31, 2026, the SCALE rate was 1.3869% and the Company's credit loss allowance rate specific to notes receivable was 3.6%. The increase over the SCALE rate was due to both the above mentioned risks presented by a concentrated balance with a single borrower and declining collections industry-wide. As of both March 31, 2026 and December 31, 2025, the Company's allowance for credit losses related to notes receivable outstanding was approximately $0.3 million. In order to evaluate the need for an adjustment to the receivable balance related to credit losses, or impairment, the Company performs a review of all outstanding loan receivables on a quarterly basis to determine if any indicators exist that suggest the loan will not be fully recoverable and assess the credit quality of the loan receivables. This review includes monthly and cumulative key performance indicators for each loan and borrower, as well as evaluation of borrower's financial condition.

**Equity method investments**

Similar to notes receivable, the loans held by the Joint Ventures are evaluated on a quarterly basis to determine if an adjustment to the allowance for credit losses is needed.

As of March 31, 2026, the SCALE rate was 1.3869% and the credit loss allowance rate specific to equity method investments was 4.9%. The increase over the SCALE rate was due to both the above mentioned risks presented by a concentrated balance with a single borrower and declining collections industry-wide. As of both March 31, 2026 and December 31, 2025, the Company's allowance for credit losses related to its equity method investments was approximately $1.0 million.

***Business combinations***

Acquisitions are accounted for under ASC Topic 805, Business Combinations ("ASC 805"), which requires that assets acquired and liabilities assumed that are deemed to be a business are recorded based on their respective acquisition date fair values. ASC 805 further requires that separately identifiable intangible assets be recorded at their acquisition date fair values and that the excess of consideration paid over the fair value of assets acquired and liabilities assumed (including identifiable intangible assets) should be recorded as goodwill. Effective January 1, 2026 Heritage DebtX LLC ("DebtX"), a wholly owned subsidiary of Heritage Global, Inc., acquired substantially all of the assets of The Debt Exchange Inc. for approximately $8.5 million. The purchase price allocation was based on an evaluation of the appropriate fair values and represents management's best estimate. See Note 3 to the Company's condensed consolidated financial statements for further detail.

***Recently adopted accounting pronouncements***

On December 14, 2023, the FASB issued ASU 2023-09, "Income Taxes (Topic 740): Improvements to Income Tax Disclosures" ("ASU 2023-09"), which requires enhanced annual disclosures with respect to the rate reconciliation and income taxes paid information. ASU 2023-09 is effective for fiscal years beginning after December 15, 2024, with adoption permitted on a prospective basis. The Company adopted this standard for the year ended December 31, 2025 and applied the new disclosure requirements prospectively.

In July 2025, the FASB issued an accounting pronouncement (ASU 2025-05) related to credit losses for accounts receivable and contract assets. The amendments in this update provide a practical expedient that permits an entity to assume that conditions at the balance sheet date remain unchanged over the life of the asset to simplify the estimation of expected credit losses for current accounts receivable and current contract assets. This update is effective for annual periods beginning after December 15, 2025, including interim periods within those fiscal years, though early adoption is permitted. While the Company adopted this pronouncement for the fiscal year beginning January 1, 2026, the Company elected the practical expedient permitted under this ASU and the adoption has no material impact on the Company's consolidated financial statements.

***Future accounting pronouncements***

On November 4, 2024, the FASB issued ASU 2024-03, "Reporting Comprehensive Income—Expense Disaggregation Disclosures" ("ASU 2024-03") which requires disaggregated disclosure of income statement expenses for public business entities. ASU 2024-03 does not change the expense captions an entity presents on the face of the income statement; rather, it requires disaggregation of certain expense captions into specified categories in disclosures within the footnotes to the financial statements. ASU 2024-03 is effective for all public business entities for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027. Early adoption is permitted. The Company anticipates that ASU 2024-03 will have no accounting impact but will require additional disclosure to further detail certain income statement expense information.

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In September 2025, the FASB issued an accounting pronouncement (ASU 2025-06) related to accounting for internal-use software costs. The amendments in this update improve the operability of the guidance by removing all references to software development project stages so that the guidance is neutral to different software development methods. This update is effective for annual periods beginning after December 15, 2027, including interim periods within those fiscal years, though early adoption is permitted. The Company plans to adopt this pronouncement for our fiscal year beginning January 1, 2028 and anticipates that ASU 2025-06 will not have a material impact on the Company's consolidated financial statements.

In December 2025, the FASB issued ASU 2025-11, "Interim Reporting (Topic 270): Narrow-Scope Improvements," which clarifies interim disclosure requirements by improving the navigability of the required interim disclosures and clarifying when that guidance is applicable. The standard is effective for interim reporting periods within annual reporting periods beginning after December 15, 2027. Early adoption is permitted. The Company is currently evaluating the potential impact the adoption of this standard will have on its consolidated financial statements and disclosures, which is not expected to be material.

**Note 3 – Business Combinations**

Effective January 1, 2026, (the "Acquisition Date") and pursuant to an Asset Purchase Agreement dated January 9, 2026, Heritage DebtX LLC ("DebtX"), a wholly owned subsidiary of Heritage Global, Inc., completed the acquisition of substantially all of the assets of The Debt Exchange, Inc., a provider of loan sale advisory services for commercial and consumer debt. The acquisition enhances the Company's capabilities in financial advisory services and expands its customer relationships within the banking and financial services sector. The total purchase consideration paid to The Debt Exchange, Inc. was approximately $8.5 million, consisting of cash paid at closing and amounts placed into escrow.

The Company has determined the transaction to be a business combination in accordance with ASC 805 Business Combinations. Accordingly, the assets acquired and liabilities assumed in the transaction were recorded at their estimated acquisition fair values, while transaction costs associated with the acquisition were expensed as incurred pursuant to the purchase method of accounting in accordance with ASC 805. The Company's purchase price allocation was based on an evaluation of the appropriate fair values and represents management's best estimate based on available data. Fair values are determined based on the requirements of ASC Topic 820, Fair Value Measurement ("ASC 820").

The following table summarizes the allocation of the purchase consideration to the estimated fair values of assets acquired and liabilities assumed as of the Acquisition Date (in thousands):

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| | |
|:---|:---|
| Other current assets | $67 |
| Property and equipment | 38 |
| Intangible assets | 3060 |
| Goodwill | 5301 |
| Other current liabilities | (6) |
| Purchase price | $8460 |

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The $3.1 million of intangible assets are attributable to $1.3 million of customer relationships which will be amortized over a useful life of 15 years, $1.8 million for the DebtX trade name which has an indefinite useful life, and approximately $26,000 of non-compete agreements which will be amortized over one year.

The excess of the consideration transferred over the fair values of assets acquired and liabilities assumed was recorded as goodwill, which was primarily attributed to increased synergies that are expected to be achieved from the acquisition. Goodwill is expected to be deductible for income tax purposes.

The financial results of DebtX have been included in the Company's consolidated financial statements since the Acquisition Date and have been reported as the Commercial Loans segment within the Company's Financial Assets Division. As of March 31, 2026, DebtX contributed revenue of $0.6 million and net loss of $0.6 million to the Company's consolidated results.

For the year ended December 31, 2025, The Debt Exchange, Inc. reported, on a standalone basis, revenues of approximately $6.6 million and operating income of approximately $0.8 million. As the acquisition was effective on January 1, 2026, these unaudited results were not included in the Company's consolidated results of operations for the year ended December 31, 2025.

The Company incurred acquisition-related costs of $0.3 million that consisted primarily of legal and advisory services. These costs are included in selling, general and administrative expenses for the year ended December 31, 2025.

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**Unaudited Pro Forma Financial Information**

The unaudited pro forma financial information presented in the table below (in thousands) is provided for illustrative purposes only and summarizes the combined results of operations of the Company and DebtX for the three months ended March 31, 2026 and 2025. For purposes of this pro forma presentation, the acquisition of substantially all of the assets of The Debt Exchange, Inc. is assumed to have occurred on January 1, 2025. The pro forma financial information for all periods presented also includes the estimated business combination accounting effects resulting from this acquisition, notably amortization expense from the acquired intangible assets and certain other integration related impacts.

This unaudited pro forma financial information should not be relied upon as being indicative of the historical results that would have been obtained if the acquisition had actually occurred on January 1, 2025, and are not intended to be a projection of future trends or results.

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| | | |
|:---|:---|:---|
|  | **Three Months Ended March 31,** | **Three Months Ended March 31,** |
|  | **2026** | **2025** |
|  |  | **(pro forma)** |
| Revenues | $12725 | $14429 |
| Net operating income | $1008 | $908 |
| Net income | $717 | $703 |
| Net income per share - basic | $0.02 | $0.02 |
| Net income per share - diluted | $0.02 | $0.02 |

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The pro forma financial information for all periods presented also includes the estimated business combination accounting effects resulting from this acquisition, notably amortization expense from the acquired intangible assets and certain other integration related impacts.

**Note 4 – Accounts Receivable, net** 

As further discussed in the Company's Annual Report on Form 10-K for the year ended December 31, 2025, the Company's accounts receivable are primarily related to the operations of its business. With respect to auction proceeds and asset dispositions, including NLEX's brokerage transactions, the assets are not released to the buyer until payment has been received. With respect to appraisal service fees, ALT's laboratory equipment sales and DebtX's loan sale advisory service fees, the Company extends credit to entities and institutions of significance, such as well-known academic and financial institutions and U.S. government agencies. The Company, therefore, is not exposed to significant collectability risk relating to these receivables. Given this experience, together with the ongoing business relationships between the Company and its joint venture partners, the Company has not historically required a formal credit quality assessment in connection with these activities. The Company has not experienced any significant collectability issues with its accounts receivable. As the Company's business expands, more comprehensive credit assessments may be required.

In accordance with ASC 326, the Company performs a review of accounts receivables on a quarterly basis. During the three months ended March 31, 2026, the Company recorded no material adjustments for credit losses in selling, general and administrative expense on the consolidated statement of income related to accounts receivable. As of both March 31, 2026 and December 31, 2025, the reserve for credit losses was approximately $0.2 million.

**Note 5 – Notes Receivable, net** 

The Company's notes receivable, net consists of investments in loans to buyers of charged-off and nonperforming receivable portfolios through HGC and financing of laboratory equipment sales through ALT.

As of March 31, 2026 and December 31, 2025, the Company's outstanding notes receivable balance related to loans to buyers of charged-off and nonperforming receivable portfolios, net of unamortized deferred fees and costs on originated loans, and adjusted for the allowance for credit losses was $8.1 million and $8.8 million, respectively. The activity during the three months ended March 31, 2026 includes the additional investment in notes receivable of approximately $1.0 million, which was offset by principal payments made by borrowers of approximately $1.8 million.

As of March 31, 2026 and December 31, 2025, the Company's outstanding notes receivable balance related to financing of laboratory equipment sales, net of unamortized deferred fees and costs on originated loans and adjusted for the reserve for credit losses was $0.5 million and $0.6 million, respectively. The activity during the three months ended March 31, 2026 includes the investment in notes receivable of approximately $0.1 million, which was offset by principal payments made by purchasers of $0.2 million and an immaterial amount of deferred financing fees, and allowance for credit losses.

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The table below shows the Company's lending activity for the three months ended March 31, 2026 (in thousands):

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| | |
|:---|:---|
| Notes receivable as of December 31, 2025 | $9804 |
| Investment in notes receivable | 1047 |
| Principal repayments | (1940) |
| Notes receivable, as of March 31, 2026 | 8911 |
| Deferred financing fees and costs, net | (39) |
| Allowance for credit losses | (321) |
| **Notes receivable, net, as of March 31, 2026** | $8551 |

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In accordance with ASC 326, the Company performs a review of notes receivable on a quarterly basis. During the three months ended March 31, 2026, the Company made no material changes to the provision for credit losses in selling, general and administrative expense on the consolidated statement of income. As of March 31, 2026 and December 31, 2025, the amortized cost basis of notes receivable in nonaccrual status was $4.8 million and $4.9 million, respectively.

**Note 6 – Stock-based Compensation**

As of March 31, 2026, the Company had four stock-based compensation plans, which are described more fully in *Note 16 – Stockholders' Equity - Stock-Based Compensation Plans* of the Company's audited consolidated financial statements for the year ended December 31, 2025 contained in the Company's Form 10-K.

***Stock Options***

During the three months ended March 31, 2026, the Company issued options to purchase 955,000 shares of common stock to certain of the Company's employees. The Company did not issue any shares of common stock as a result of option exercises, nor did the Company cancel any options to purchase common stock as a result of employee resignations during the three months ended March 31, 2026.

The following summarizes the changes in common stock options for the three months ended March 31, 2026:

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| | | | | |
|:---|:---|:---|:---|:---|
|  | **Options** | **Weighted<br>Average<br>Exercise<br>Price** | **Weighted<br>Average<br>Remaining Contractual Term (Years)** | **Aggregate Intrinsic Value (In thousands)** |
| Outstanding as of December 31, 2025 | 2172600 | $1.76 | 5.1 | $408 |
| Granted | 955000 | $1.30 |  |  |
| **Outstanding as of March 31, 2026** | 3127600 | $1.62 | 6.3 | $535 |
| **Options exercisable as of March 31, 2026** | 1894975 | $1.65 | 4.4 | $478 |

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The Company recognized stock-based compensation expense related to common stock options of $0.1 million for both the three months ended March 31, 2026 and 2025. As of March 31, 2026, there was approximately $1.1 million of unrecognized stock-based compensation expense related to unvested common stock options outstanding, which is expected to be recognized over a weighted average period of 1.8 years.

***Restricted Stock***

Restricted stock awards represent a right to receive shares of common stock at a future date determined in accordance with the participant's award agreement. There is no exercise price and no monetary payment required for receipt of restricted stock awards or the shares issued in settlement of the award. Instead, consideration is furnished in the form of the participant's services to the Company. Compensation cost for these awards is based on the fair value of the shares of common stock on the date of grant and recognized as compensation expense on a straight-line basis over the requisite service period.

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The following summarizes the restricted stock awards and related stock-based compensation expense (in thousands, except share count and award fair value):

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| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Grant Date** | **Vesting Date** | **Restricted Stock Granted** | **Per Share Grant Date Fair Value** | **Compensation Expense for the three months ended March 31,** | **Compensation Expense for the three months ended March 31,** | **Unrecognized Compensation Expense as of,** |
|  |  |  |  |  | **2025** | **2026** | **March 31, 2026** |
| Employees | March 7, 2024 | March 7, 2025 | 128044 | $2.93 | 67 |  |  |
| Non-executive directors | March 7, 2024 | March 7, 2025 | 75000 | $2.93 | 40 |  |  |
| Employees | January 1, 2025 | December 31, 2028 [1] | 125000 | $1.85 | 14 | 14 | 159 |
| Employees | March 6, 2025 | March 6, 2026 | 68051 | $2.11 | 10 | 26 |  |
| Non-executive directors | March 6, 2025 | March 6, 2026 [2] | 100000 | $2.11 | 15 | 38 |  |
| Non-executive directors | March 5, 2026 | March 5, 2027 [3] | 100000 | $1.30 |  | 9 | 121 |
| **Total** |  |  |  |  | $**146** | $**87** | $**280** |

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[1] These restricted stock awards vest 25% annually over four years, until fully vested on December 31, 2028.

[2] These restricted stock awards vest 25% quarterly over one year, until fully vested on March 6, 2026.

[3] These restricted stock awards vest 25% quarterly over one year, until fully vested on March 5, 2027.

The Company determined the fair value of the shares awarded by using the closing price of our common stock as of the grant date. Stock-based compensation expense related to the restricted stock awards was approximately $0.1 million for both the three months ended March 31, 2026 and 2025. The unrecognized stock-based compensation expense as of March 31, 2026 was approximately $0.3 million, which is expected to be recognized over a weighted average period of 1.8 years.

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**Note 7 – Equity Method Investments**

The Company has significant influence over the operations and financial policies of each of its equity method investments.

***Joint ventures formed in connection with the Company's Auction and Liquidation segment***

In December 2023, KNFH II LLC, of which the Company holds a 25% share, was formed to purchase certain real estate assets and machinery and equipment among partners in a joint venture.

In January 2025, DLZ Solutions LLC ("DLZ"), a joint venture in which the Company holds a 20% share, entered into a purchase agreement to purchase certain real estate assets and a lease agreement to lease back the purchased real estate assets to the seller.

In December 2022, DHC8 LLC, of which the Company held a 13.33% share was formed to provide funding and receive principal and interest payments as a result of the initial investment. This joint venture was dissolved in [June] 2025.

***Joint ventures formed in connection with the Company's Specialty Lending segment***

In March 2020, HGC Origination I LLC and HGC Funding I LLC were formed as joint ventures with a partner for purposes of conducting business relating to the sourcing, origination and funding of loans to debt purchasing clients. HGC Funding I LLC was dissolved in December 2025.

In May 2023, HGC MPG Funding LLC, of which the Company holds a 25% share, was formed as a joint venture with a partner for purposes of conducting business relating to the sourcing, origination and funding of loans to debt purchasing clients.

In accordance with ASC 326, the Company performs a review of notes receivable on a quarterly basis for each of its specialty lending investments. During the three months ended March 31, 2026, the Company made no material adjustment for its share of the joint venture's provision for credit losses. As of March 31, 2026, the Company's share of the allowance for credit losses was primarily related to HGC Origination I LLC and HGC MPG Funding LLC. As of March 31, 2026, the amortized cost basis of the Company's share of loans in nonaccrual status recorded in equity method investments was $18.9 million.

The table below details the Company's joint venture revenues, earnings, assets, and liabilities for the three months ended and as of March 31, 2026 (in thousands):

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **KNFH II LLC** | **DLZ Solutions LLC** | **HGC Origination I LLC** | **HGC MPG Funding LLC** | **Total** |
| Revenue | $34 | $2795 | $1141 | $1282 | $5252 |
| Gross profit | 34 | 2795 | 1141 | 1282 | 5252 |
| Operating income | 1 | 2599 | 1119 | 1282 | 5001 |
| Net income | 1 | 2599 | 1119 | 1282 | 5002 |
| Assets | 6943 | 255 | 23521 | 28383 | 59103 |
| Liabilities | 2008 | 199 | 269 |  | 2476 |

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The table below details the Company's joint venture revenues, earnings, assets, and liabilities for the three months ended and as of March 31, 2025 (in thousands):

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| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **DHC8 LLC** | **KNFH II LLC** | **DLZ Solutions LLC** | **HGC Funding I LLC and Origination I LLC** | **HGC MPG Funding LLC** | **Total** |
| Revenues | $55 | $— | $130 | $1202 | $1392 | $2779 |
| Gross profit | 55 | (53) | 130 | 1202 | 1392 | 2726 |
| Operating income (loss) | 41 | (108) | 19 | 1203 | 1392 | 2547 |
| Net income (loss) | 41 | (108) | 19 | 1203 | 1392 | 2547 |
| Assets | 928 | 7568 | 7901 | 23247 | 31381 | 71025 |
| Liabilities | 624 | 2267 | 8 | 22 |  | 2921 |

---

------

***Lessor Arrangements***

In December 2023, the Company, with certain partners making up the KNFH II LLC joint venture, entered into a purchase and sale agreement for a pharmaceutical plant in Fenton, Missouri, including land, a building, and all machinery and equipment held within, with a purchase price of $8.0 million.

In April 2024, KNFH II LLC entered into a purchase and sale agreement for the machinery and equipment within the pharmaceutical plant with a purchase price of $5.0 million. Additionally, KNFH II LLC entered into a lease agreement for the lease of the real estate assets; the building and land. This lease agreement includes a purchase option with a purchase price of $8.0 million that is expected to be exercised by the lessee. The lessor arrangement is classified as a sales-type lease, and, therefore, the present value of future lease payments, including the purchase option, has been recognized as revenue and a lease receivable as of the effective date. As of March 31, 2026, the Company recognized approximately $1.2 million in life-to-date earnings of equity method investments, related to the Company's share of net income attributable to KNFH II LLC.

On January 29, 2025, DLZ, a joint venture in which the Company holds a 20% share, entered into a purchase agreement for a pharmaceutical plant in Huntsville, Alabama, including land and a building, with a purchase price of approximately $7.8 million. Simultaneously, DLZ entered into a lease agreement with the Seller, for the lease of the real estate assets, the building and land. This lease agreement includes a purchase option exercisable prior to the end of the first 18-month lease term with a purchase price of approximately $9.7 million. Concurrently, the Company sold a one-third economic interest in cash flows related to the DLZ investment, which is reflected as a secured borrowing on its balance sheet within other current liabilities. In March 2026, the Seller exercised its purchase option and the joint venture received payment in full. As of March 31, 2026, the Company has recorded approximately $0.6 million in life-to-date earnings in equity method investments and approximately $0.2 million in cost of services revenue related to the investment on the consolidated statement of income.

Additionally, on January 29, 2025, the Company purchased a 20% participating interest in a financial asset for approximately $1.6 million. The participants' investment was used to purchase machinery and equipment at the same pharmaceutical plant in Huntsville, Alabama for approximately $7.8 million. The participants entered into a lease agreement to lease the purchased machinery and equipment back to the seller with an 18-month lease term which includes purchase option exercisable prior to the end of the term with a purchase price of approximately $9.5 million. Concurrently, the Company sold a one-third economic interest in cash flows related to its participating interest, which is reflected as a secured borrowing on its balance sheet within other current liabilities. In March 2026, the Seller made an additional principal payment which reduces the contractual purchase price upon the exercise of the purchase option. As of March 31, 2026, the Company reflects its participating interest of $0.9 million on its balance sheet within other long-term assets. As of March 31, 2026, the Company has recorded approximately $147,000 in services revenue and approximately $49,000 in costs of services revenue related to the investment on the consolidated statement of income.

**Note 8 – Earnings Per Share**

The Company is required, in periods in which it has net income, to calculate basic earnings per share ("basic EPS") using the two-class method. The two-class method is required because the Company's shares of Series N preferred stock, each of which is convertible to 40 common shares, have the right to receive dividends or dividend equivalents should the Company declare dividends on its common stock. Under the two-class method, earnings for the period are allocated on a pro-rata basis to the common and preferred stockholders. The weighted-average number of common and preferred shares outstanding during the period is then used to calculate basic EPS for each class of shares. For both the three months ended March 31, 2026 and 2025, the earnings allocated to the outstanding preferred shares were not material.

In periods in which the Company records a net loss, basic loss per share is calculated by dividing the loss attributable to common stockholders by the weighted-average number of common shares outstanding during the period. As the preferred stock does not participate in losses, the two-class method is not used in periods in which the Company records a net loss.

Stock options and other potential common shares are included in the calculation of diluted earnings per share ("diluted EPS"). In calculating diluted EPS, such shares are assumed to be exercised or converted, except when their effect would be anti-dilutive.

The table below shows the calculation of the number of shares used in computing diluted EPS:

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| | | |
|:---|:---|:---|
|  | **Three Months Ended March 31,** | **Three Months Ended March 31,** |
|  | **2026** | **2025** |
| Basic weighted average shares outstanding | 34596265 | 35282855 |
| Treasury stock effect of common stock options and restricted stock awards | 395717 | 773790 |
| **Diluted weighted average common shares outstanding** | 34991982 | 36056645 |

---

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For the three months ended March 31, 2026 and 2025, there were potential common shares of 2.5 million and 0.8 million, respectively, that were excluded from the computation of diluted EPS, as the inclusion of such common shares would have been anti-dilutive.

**Note 9 – Leases**

The Company leases office and warehouse space in four locations: Del Mar, California, Hayward, California, San Diego, California and Edwardsville, Illinois. The Company determined that all of its lease arrangements are classified as operating leases.

On August 12, 2022, the Company entered into an agreement with Liberty Industrial Park, LLC pursuant to which the Company leases 6,627 square feet of industrial space in San Diego, California. The commencement date of the lease was September 1, 2022 and the lease term expires on August 30, 2027. It provides for an initial monthly base rent of $11,266, which increases on an annual basis to $13,180 per month in the final year. In addition, the Company is obligated to pay its share of maintenance costs of common areas.

On June 1, 2023, the Company amended its Edwardsville office building lease with David Ludwig, extending the term of the agreement to May 31, 2027 and setting rent amounts for the new term. It provides for an initial monthly base rent of $9,412, which increases on an annual basis to $9,914 per month in the final year.

On September 23, 2024, the Company amended its Del Mar office lease with OF 09 Hacienda, LLC, extending the term of the agreement by 24 months to February 28, 2027 and setting rent amounts for the new term. The amended Del Mar office lease provides for an initial monthly base rent of $14,660 beginning March 1, 2025 and increases on an annual basis to $15,099 per month in the final year.

The right-of-use assets and lease liabilities for each lease location are as follows (in thousands):

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| | | |
|:---|:---|:---|
|  | **March 31,** | **December 31,** |
|  | **2026** | **2025** |
| **Right-of-use assets:** |  |  |
| Del Mar, CA | $155 | $197 |
| Hayward, CA | 855 | 933 |
| San Diego, CA | 198 | 231 |
| Edwardsville, IL | 131 | 157 |
| **Total right-of-use assets** | $1339 | $1518 |
| **Lease liabilities** |  |  |
| Del Mar, CA | $164 | $205 |
| Hayward, CA | 923 | 1003 |
| San Diego, CA | 215 | 250 |
| Edwardsville, IL | 135 | 161 |
| **Total lease liabilities** | $1437 | $1619 |

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The Company's leases generally do not provide an implicit rate, and, therefore, the Company uses its incremental borrowing rate as the discount rate when measuring operating lease liabilities. The incremental borrowing rate represents an estimate of the interest rate the Company would incur at lease commencement to borrow an amount equal to the lease payments on a collateralized basis over the term of a lease within the same particular economic environment. The Company used its incremental borrowing rate as of January 1, 2019 for operating leases that commenced prior to that date. As of January 1, 2019, the Company's incremental borrowing rate was 5.25%. For leases commencing after January 1, 2019 the Company uses its incremental borrowing rate at time of commencement. On September 1, 2022, June 1, 2023, and September 23, 2024, the Company's incremental borrowing rate was 5.50%, 7.25%, and 6.25%, respectively. The weighted average remaining lease term for operating leases is 2.0 years and the weighted average discount rate is 5.4% as of March 31, 2026.

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Lease expense is recognized on a straight-line basis over the lease term. For both the three month periods ended March 31, 2026 and 2025, lease expense was approximately $0.2 million. As of March 31, 2026, undiscounted future minimum lease payments related to leases that have initial or remaining lease terms in excess of one year are as follows (in thousands):

---

| | |
|:---|:---|
| 2026 (remainder of year from April 1, 2026 to December 31, 2026) | $626 |
| 2027 | 573 |
| 2028 | 299 |
| &nbsp;&nbsp;&nbsp;&nbsp;Total undiscounted future minimum lease payments | 1498 |
| Less: imputed interest | (61) |
| **Present value of lease liabilities** | $1437 |

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Note 10 – Property and Equipment, net

Property and equipment are recorded at historical cost. Depreciation is provided for in amounts sufficient to relate the cost of depreciable assets to operations over their estimated service lives on a straight-line basis. The life of the building acquired in connection with the ALT purchase transaction was determined to be 25 years. Leasehold improvements are amortized over the useful life of the asset or the lease term, whichever is shorter. Estimated service lives are five years for furniture, fixtures and office equipment and three years for software and technology assets. Expenditures for repairs and maintenance not considered to substantially lengthen the life of the asset or increase capacity or efficiency are charged to expense as incurred.

On February 11, 2025, the Company purchased real estate for $7.4 million consisting of land and a building which is used as the Company's corporate headquarters and as warehouse and office space for the operations of HGP. The Company allocated $2.8 million of the purchase price to the building and $4.6 million to the land. The life of the building was determined to be 30 years. The Company capitalized a total of $2.6 million in building improvements and the building was placed in service on March 1, 2026 with a total depreciable cost of approximately $5.4 million.

Also included in the purchase transaction was an agreement for a short-term leaseback to the seller, which ended on March 31, 2025, and resulted in a credit within the closing statement of approximately $0.1 million. This credit is considered rental income and classified as service revenue on our 2025 consolidated statement of income, and reflected as gross profit within our Corporate and other segment.

The following summarizes the components of the Company's property and equipment (in thousands):

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| | | |
|:---|:---|:---|
|  | **March 31, 2026** | **December 31, 2025** |
| Building | $6370 | $3797 |
| Land | 4985 | 4985 |
| Furniture, fixtures and office equipment | 957 | 352 |
| Software and technology assets | 652 | 461 |
| Vehicles | 11 | 11 |
| Construction in progress | 12 | 2031 |
|  | 12987 | 11637 |
| Accumulated depreciation | (958) | (753) |
| **Property and equipment, net** | $12029 | $10884 |

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**Note 11 – Intangible Assets and Goodwill**

***Intangible assets***

The Company's identifiable intangible assets as of March 31, 2026 and December 31, 2025 are shown below (in thousands except for lives):

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---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **Remaining** | **Carrying Value** |  |  | **Carrying Value** |
|  | **Life** | **December 31,** |  |  | **March 31,** |
|  | **(years)** | **2025** | **Additions** | **Amortization** | **2026** |
| **Amortizable intangible assets:** |  |  |  |  |  |
| Trade Name (ALT) | 15.4 | $510 | $— | $(8) | $502 |
| Vendor Relationship (ALT) | 0.4 | 153 |  | (58) | 95 |
| Customer Relationship (DebtX) | 14.8 |  | 1272 | (21) | 1251 |
| Noncompete Agreements (DebtX) | 0.8 |  | 26 | (7) | 19 |
| **Total amortizable intangible assets** |  | 663 | 1298 | (94) | 1867 |
| **Indefinite-lived intangible assets:** |  |  |  |  |  |
| Trade Name (NLEX) | N/A | 2437 |  |  | 2437 |
| Trade Name (DebtX) | N/A |  | 1762 |  | 1762 |
| **Total intangible assets** |  | $3100 | $3060 | $(94) | $6066 |

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Amortization expense during both the three months ended March 31, 2026 and 2025 was $0.1 million. The Company estimates that the residual value for intangible assets is not significant.

As of March 31, 2026, the estimated amortization expense for the remainder of the current fiscal year and the next five fiscal years and thereafter is shown below (in thousands):

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| | |
|:---|:---|
| **Year** | **Amount** |
| 2026 (remainder of year from April 1, 2026 to December 31, 2026) | $203 |
| 2027 | 117 |
| 2028 | 117 |
| 2029 | 117 |
| 2030 | 117 |
| Thereafter | 1196 |
| **Total estimated amortization expense** | $1867 |

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***Goodwill***

The Company's goodwill relates to its acquisition of various entities. Goodwill consists of the following at March 31, 2026 and December 31, 2025 (in thousands):

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| | | |
|:---|:---|:---|
|  | **March 31, 2026** | **December 31, 2025** |
| ALT | $1861 | $1861 |
| HGP | 2041 | 2041 |
| NLEX | 3544 | 3544 |
| DebtX | 5301 |  |
| **Total goodwill** | $12747 | $7446 |

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The Company recognized goodwill of $5.3 million in 2026 related to the acquisition of substantially all of the assets of The Debt Exchange, Inc. There were no impairments recorded to the carrying value of goodwill during either the three months ended March 31, 2026 or 2025.

**Note 12 – Debt**

Outstanding debt as of March 31, 2026 and December 31, 2025 is summarized as follows (in thousands):

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| | | |
|:---|:---|:---|
|  | **March 31, 2026** | **December 31, 2025** |
| **Current:** |  |  |
| 2021 Credit Facility | $— | $— |
| &nbsp;&nbsp;&nbsp;&nbsp;**Total third party debt, current** |  |  |
| **Non-current:** |  |  |
| Mortgage | 4100 | 4100 |
| &nbsp;&nbsp;&nbsp;&nbsp;**Total third party debt, non-current** | 4100 | 4100 |
| **Total third party debt** | $4100 | $4100 |

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As of March 31, 2026, the estimated principal repayments on outstanding debt for the remainder of the current fiscal year, the next five fiscal years and thereafter is shown below (in thousands):

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| | |
|:---|:---|
| **Year** | **Amount** |
| 2026 (remainder of year from April 1, 2026 to December 31, 2026) | $— |
| 2027 |  |
| 2028 | 55 |
| 2029 | 70 |
| 2030 | 75 |
| Thereafter | 3900 |
| **Total estimated principal repayments** | $4100 |

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***2021 Credit Facility***

On May 5, 2021, the Company entered into a promissory note, business loan agreement, commercial security agreement and pledge agreement (the "2021 Credit Facility") with C3bank, National Association ("Lender") for a $10.0 million revolving line of credit. The Company is permitted to use the proceeds of the loan solely for its business operations. The Company is the borrower under the 2021 Credit Facility. The 2021 Credit Facility is secured by a security interest in certain of the Company's subsidiaries' current and future tangible and intangible assets, inventory, chattel paper, accounts, equipment and general intangibles, and a pledge of the equity of the direct and indirect subsidiaries of the Company.

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Per the Loan Modification Agreement and Reaffirmation of Loan (the "2023 Modification Agreement"), effective as of May 26, 2023, by and between the Company and Lender, the applicable interest rate spread and floor of the 2021 Credit Facility was modified to be the Wall Street Journal Prime rate plus 1.00% (such rate not to be less than 6.75% per annum). Additionally, the 2023 Modification Agreement modified the loan covenants to provide that the Company shall pay the Lender an annual unused line fee, payable on the earlier of (a) bi-annually every six (6) months in arrears, within ten (10) days thereof, commencing on October 27, 2023, or (b) the payment in full of the 2021 Credit Facility, but only if the average balance of the 2021 Credit Facility for the respective nine months is below $5.0 million. The availability of additional draws under the 2021 Credit Facility is conditioned, among other things, on the compliance with certain customary representations and warranties, including default, insolvency or bankruptcy, material adverse change in financial condition and any guarantor's attempt to revise its guarantee. The agreement governing the 2021 Credit Facility also contains customary affirmative covenants regarding, among other things, the maintenance of records, maintenance of certain insurance coverage, compliance with governmental requirements and maintenance of several financial covenants. The 2021 Credit Facility contains certain customary financial covenants and negative covenants that, among other things, include restrictions on the Company's ability to create, incur or assume indebtedness for borrowed money, including capital leases or to sell, transfer, mortgage, assign, pledge, lease, grant a security interest in, or encumber any of the Company's assets.

The Company entered into a Loan Modification Agreement and Reaffirmation of Loan (the "Sixth Modification Agreement"), effective as of December 27, 2024, to extend the maturity date of the 2021 Credit Facility to June 27, 2026. The Sixth Modification Agreement also raises the interest rate floor by 0.25% to 7.0% and modifies certain compliance covenants.

As of March 31, 2026 there was no outstanding balance on the 2021 Credit Facility and the Company was in compliance with all financial and negative covenants.

***Mortgage***

On February 6, 2025, Heritage Nancy Ridge LLC ("Heritage Nancy Ridge"), an indirect and wholly owned subsidiary of the Company entered into a promissory note, a business loan agreement and commercial security agreement (collectively, the "Mortgage Loan Agreement") with C3bank, National Association (the "Lender"). The Mortgage Loan Agreement provides for a $4.1 million term loan (the "Mortgage"). Heritage Nancy Ridge used the proceeds of the Mortgage to purchase real property and the building located at 6130 Nancy Ridge Drive in San Diego, California (the "Nancy Ridge Property") on February 11, 2025, which is used as the Company's corporate headquarters and as warehouse and office space for the operations of Heritage Global Partners, Inc., a subsidiary of the Company that operates the Auction and Liquidation segment of the Company.

The maturity date of the Mortgage Loan Agreement is February 5, 2035. The Mortgage Loan Agreement sets the interest rate to accrue at a rate of 6.5% for the first three years of the Mortgage. For the remainder of the term, the Mortgage Loan Agreement sets the interest rate spread and interest rate floor to accrue at a variable interest rate, which is based on the one-month Term SOFR as published daily by CME Group, plus a margin of 2.25%. Additionally, the Mortgage Loan Agreement provides that in the event of prepayment, Heritage Nancy Ridge shall pay the Lender a prepayment fee during the first year of the Mortgage equal to three percent (3%) of the amount prepaid, followed by two percent (2%) of the amount prepaid in year two of the Mortgage, and one percent (1%) of the amount prepaid in year three of the Mortgage.

Heritage Ridge Nancy is the borrower and the Company is the guarantor under the Mortgage Loan Agreement. The Mortgage Loan Agreement is secured by a security interest in the Nancy Ridge Property. The Mortgage Loan Agreement contains customary affirmative covenants regarding, among other things, the maintenance of records, maintenance of certain insurance coverage, compliance with governmental requirements and maintenance of several financial covenants. The Mortgage Loan Agreement also contains certain customary financial covenants and negative covenants. The outstanding balance of the Mortgage as of March 31, 2026 was $4.1 million.

**Note 13 – Income Taxes**

As of March 31, 2026, the Company had aggregate federal net operating loss carry-forwards of $15.5 million available for utilization against taxable income achieved in 2026 and beyond. These net operating loss carry forwards begin to expire in 2026. The Company expects to utilize all remaining federal net operating loss carry forwards and does not carry a valuation allowance against its deferred tax assets. The Company has no net operating loss carry forwards limited under Section 382 of the Internal Revenue Code as of March 31, 2026.

The reported tax expense varies from the amount that would be provided by applying the statutory U.S. Federal income tax rate to the income from operations before taxes primarily as a result of the impact of state income taxes.

In July 2025, the One Big Beautiful Bill Act (the "OBBB") was enacted into law, which includes significant tax related provisions, such as the permanent extension of certain expiring provisions of the Tax Cuts and Jobs Act, modifications to the international tax framework and the restoration of favorable tax treatment for certain business provisions. The Company currently does not expect the OBBB to have a material impact on its annual effective tax rate in 2026.

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**Note 14 – Related Party Transactions**

As part of the operations of NLEX, the Company leases office space in Edwardsville, IL that is owned by the President of NLEX and a member of the board of directors of the Company, David Ludwig. The total amount paid to the related party for both the three month periods ended March 31, 2026 and 2025 was approximately $29,000, and is included in selling, general and administrative expenses in the unaudited condensed consolidated statements of income.

**Note 15 – Segment Information**

The following tables sets forth certain financial information for the Company's reportable segments for the three month periods ended March 31, 2026 and 2025 (in thousands):

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| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Three Months Ended March 31, 2026** | **Three Months Ended March 31, 2026** | **Three Months Ended March 31, 2026** | **Three Months Ended March 31, 2026** | **Three Months Ended March 31, 2026** | **Three Months Ended March 31, 2026** | **Three Months Ended March 31, 2026** |
|  | **Auction and Liquidation** | **Refurbishment & Resale** | **Consumer Loans** | **Commercial Loans** | **Specialty Lending** | **Corporate and other** | **Consolidated** |
| &nbsp;&nbsp;Gross profit [1] | $2395 | $1539 | $3488 | $649 | $227 | $— | $8298 |
| &nbsp;&nbsp;Operating expenses [2] | (2179) | (1032) | (1824) | (1255) | (270) | (1233) | (7793) |
| &nbsp;&nbsp;Earnings from equity method investments | 520 |  |  |  | (17) |  | 503 |
| &nbsp;&nbsp;**Operating income (loss)** | $**736** | $**507** | $**1664** | $**(606)** | $**(60)** | $**(1233)** | $**1008** |

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| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **Three Months Ended March 31, 2025** | **Three Months Ended March 31, 2025** | **Three Months Ended March 31, 2025** | **Three Months Ended March 31, 2025** | **Three Months Ended March 31, 2025** | **Three Months Ended March 31, 2025** |
|  | **Auction and Liquidation** | **Refurbishment & Resale** | **Consumer Loans** | **Specialty Lending** | **Corporate and other** | **Consolidated** |
| &nbsp;&nbsp;Gross profit [1] | $2876 | $1324 | $3378 | $368 | $65 | $8011 |
| &nbsp;&nbsp;Operating expenses [2] | (2125) | (1052) | (1778) | (353) | (1344) | (6652) |
| &nbsp;&nbsp;Earnings from equity method investments | (20) |  |  | 64 |  | 44 |
| &nbsp;&nbsp;**Operating income (loss)** | $**731** | $**272** | $**1600** | $**79** | $**(1279)** | $**1403** |

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[1] Within the Company's Industrial Asset division, management allocates gross profit resulting from certain auctions from Auctions and Liquidation (HGP) to Refurbishment & Resale (ALT). From time to time, ALT may source and refer an auction project to HGP or directly sell lab equipment inventory through the auction channel. In these instances, the profits relating to these transactions are allocated to ALT rather than accounted for under the segment profit or loss of HGP. During the three months ended March 31, 2026, the total amount of gross profit allocated to ALT from HGP was approximately $0.1 million, as compared to the total amount of gross profit allocated to ALT during the same period of 2025 of approximately $0.3 million.

[2] All financing arrangements are originated with Corporate and other. Management may determine from time to time that interest incurred from financing arrangements are directly attributable to a specific segment. As a result, interest incurred may be charged to the segment and included in that segment's profit or loss as a charge to operating expense. No interest expense has been allocated to operating segments during the three months ended March 31, 2026 or the three months ended March 31, 2025.

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**Note 16 – Subsequent Events**

The Company has evaluated events subsequent to March 31, 2026 for potential recognition or disclosure in its condensed consolidated financial statements. There have been no material subsequent events requiring recognition or disclosure in this Quarterly Report on Form 10-Q.

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**Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations.**

The following discussion and analysis should be read in conjunction with the information contained in the unaudited condensed consolidated interim financial statements of Heritage Global Inc., a Florda Corporation ("HG") together with its consolidated subsidiaries, "we", "us", "our" or the "Company", and the related notes thereto for the three month periods ended March 31, 2026 and 2025, appearing elsewhere herein, and in conjunction with the Management's Discussion and Analysis of Financial Condition and Results of Operations set forth in the Company's Annual Report on Form 10-K for the year ended December 31, 2025, filed with the Securities and Exchange Commission ("SEC") on March 12, 2026 (the "Form 10-K").

***Forward Looking Information***

*This Quarterly Report on Form 10-Q (the "Report") contains certain "forward-looking statements" as defined by the Private Securities Litigation Reform Act of 1995 that are based on management's exercise of business judgment as well as assumptions made by, and information currently available to, management. When used in this document, the words "may," "will," "anticipate," "believe," "estimate," "expect," "intend," and words of similar import, are intended to identify any forward-looking statements. You should not place undue reliance on these forward-looking statements. We have based these forward-looking statements largely on our current expectations and projections about future events and trends that we believe may affect our financial condition, results of operations, business strategy, short-term and long-term business operations and objectives, and financial needs. These statements are subject to certain risks, uncertainties, and assumptions, including variability in magnitude and timing of asset liquidation transactions, the collectability of the charged off receivables that secure our loan portfolio, the impact of tariffs and other changes in the U.S. national and global economies, and interest rate and foreign exchange rate sensitivity, as well as the important factors noted under Item 1A "Risk Factors" in our Form 10-K, and as noted below. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, our actual results could differ materially from those anticipated in these forward-looking statements. We undertake no obligation, and do not intend, to update, revise or otherwise publicly release any revisions to these forward-looking statements to reflect events or circumstances after the date hereof, or to reflect the occurrence of any unanticipated events. Although we believe that our expectations are based on reasonable assumptions, we can give no assurance that our expectations will materialize.*

**Overview, History and Recent Developments**

Heritage Global Inc. was incorporated in Florida in 1983 under the name "MedCross, Inc." Our name was changed to "I-Link Incorporated" in 1997, to "Acceris Communications Inc." in 2003, to "C2 Global Technologies Inc." in 2005, to "Counsel RB Capital Inc." in 2011, and to Heritage Global Inc. in 2013. The most recent name change more closely identifies HG with its auction and specialty lending business lines.

Our corporate headquarters are located at 6130 Nancy Ridge Drive, San Diego, CA 92121. Our telephone number is (858) 847-0659 and our corporate website is *www.hginc.com*. Information contained on our website is not incorporated by reference into this Form 10-Q.

***DebtX Asset Acquisition***

As discussed further under Note 3 - Business Combinations, effective January 1, 2026 (the "Acquisition Date") and pursuant to an Asset Purchase Agreement dated January 9, 2026, Heritage DebtX LLC ("DebtX"), a wholly owned subsidiary of HG, completed the acquisition of substantially all of the assets of The Debt Exchange, Inc., a provider of loan sale advisory services for commercial and consumer debt. The acquisition enhances the Company's capabilities in financial advisory services and expands its customer relationships within the banking and financial services sector. Following the acquisition, the financial results of DebtX have been included in the Company's consolidated financial statements since the Acquisition Date and have been reported as the Commercial Loans segment within the Company's Financial Assets Division.

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The organization chart below outlines our basic domestic corporate structure as of March 31, 2026.

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| | | | | |
|:---|:---|:---|:---|:---|
|  | Heritage Global Inc. <sup>(1)</sup> | Heritage Global Inc. <sup>(1)</sup> |  |  |
| 100% | 100% | 100% | 100% | 100% |
| Heritage Global<br>Partners, Inc. <sup>(2)</sup><br>(California) | Heritage Global LLC <sup>(3)</sup><br>(Delaware) | National Loan<br>Exchange, Inc. <sup>(5)</sup><br>(Illinois) | Heritage Global Capital LLC <sup>(6)</sup><br>(Delaware) | Heritage DebtX LLC <sup>(7)</sup><br>(Delaware) |
|  | 100% |  |  |  |
|  | Heritage ALT LLC <sup>(4)</sup><br>(Delaware) |  |  |  |

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____________________

<sup>(1)</sup> Registrant.

<sup>(2)</sup> Auction and Liquidation.

<sup>(3)</sup> Holding Company.

<sup>(4)</sup> Refurbishment and Resale.

<sup>(5)</sup> Consumer Loans.

<sup>(6)</sup> Specialty Lending.

<sup>(7)</sup> Commercial Loans.

**Nonaccrual Loans**

We determine a loan to be in default status when the minimum payment amount has not been received within the grace period of the payment due date. The status of default does not solely trigger nonaccrual loan status. We consider quantitative and qualitative factors when evaluating a loan in default status to determine the likelihood of recovering the outstanding principal balance and contractual interest payments. We also monitor financial standing and performance of our borrowers on an ongoing basis and regularly update the collection forecasts for the underlying charged off or nonperforming receivable portfolios related to each outstanding loan. If we determine (1) it is not probable that the projected cash flows expected from the borrower's collection efforts on the underlying charged off or nonperforming receivable portfolio will be sufficient to satisfy all of the outstanding principal balance and contractual interest payments, and (2) it is not probable that the borrower will be able to meet the minimum required principal and interest payments through other operational cash flows, we will place the loans on nonaccrual status. If, based on our analysis, we elect to maintain accrual status after initial payment default, the loan will generally be placed on nonaccrual status if principal or interest payments become 90 days past due.

The accrual of interest is generally discontinued and all accrued interest is reversed against interest income when a loan is placed on nonaccrual status. Interest received on such loans is accounted for using the cost-recovery or the cash-basis method, until qualifying for return to accrual. Under the cost-recovery method, interest income is not recognized until the loan balance is reduced to zero. Under the cash-basis method, interest payments received by the creditor are recorded as interest income provided the amount does not exceed the amount that would have been earned at the loan's original effective interest rate. Loans are returned to accrual status when all the principal and interest amounts contractually due are brought current, there is a sustained period of repayment performance, and all remaining principal and interest payments are deemed probable.

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Pursuant to the terms of existing credit agreements, our largest borrower was required to collect on underlying charged off and nonperforming consumer loan portfolios and remit a required minimum monthly payment to us. However, this borrower became unable to make the required minimum monthly payments and therefore is in default. While in default, this borrower continues to collect on the underlying charged off and nonperforming consumer loan portfolios but must remit all such net collections to us and senior lenders. These remittances of net collections have not met the amount of the required minimum monthly payments since June of 2024. We determined that (1) it is not probable that the projected cash flows expected from the borrower's collection efforts on the underlying charged off or nonperforming receivable portfolio will be sufficient to satisfy all of the outstanding principal balance and contractual interest payments, and (2) it is not probable that the borrower will be able to meet the minimum required principal and interest payments through other operational cash flows. We do not expect to realize any return with respect to these loans in 2025, and whether we will realize any return with respect to these loans is uncertain. As we continue to work closely with the borrower and its senior lenders in an effort to mitigate the default in an efficient and effective manner, the impacted loans have been placed in nonaccrual status beginning in June 2024. In addition, there was a balance of $1.5 million from our share of other loans within affiliated Joint Ventures that are impacted by the default with our largest borrower and have been placed in nonaccrual status as of June 2024. Our share of payments received from this borrower, including interest, will be applied against the outstanding loan balance. As of March 31, 2026, the amortized cost basis of loans in nonaccrual status was $23.7 million, of which $4.8 million is recorded within notes receivable and $18.9 million is recorded within equity method investments.

In coordination with our senior lenders, we are actively engaged in a workout process with respect to loans currently in nonaccrual status, with the objective of maximizing recoveries over the remaining economic life of the underlying collateral. Our recovery strategy is centered on the monetization of the charged-off and nonperforming consumer receivable portfolios securing these loans and is expected to occur over multiple years. The primary component of the workout strategy involves transitioning a greater portion of the underlying consumer accounts into legal collection channels. During the fourth quarter of 2025, we reached a restructuring agreement with the senior lender for HGC MPG Funding LLC. As a result of this restructuring agreement and our regular quarterly portfolio analysis, we have determined it appropriate to place all loans associated with our joint ventures with senior lenders in nonaccrual status given the senior lender's priority position in cash flows generated from the underlying portfolios. As of both March 31, 2026 and December 31, 2025, the balance of additional loans placed in nonaccrual status was approximately $1.7 million.

**Industry and Competition**

Our business consists primarily of the auction, appraisal, refurbishment and asset advisory services provided by our Industrial Assets division and the consumer loan brokerage, commercial loan brokerage and specialty financing services provided by our Financial Assets division, each of which is further described below. Our business also includes the purchase and sale, including at auction, of industrial machinery and equipment, real estate, inventories, charged-off receivable and distressed debt. The market for all of these services and assets is highly fragmented. To acquire auction or appraisal contracts, or assets for resale, we compete with other liquidators, auction companies, dealers and brokers. We also compete with them for potential purchasers and lenders. Some competitors have significantly greater financial and marketing resources and name recognition.

We believe that our business is positioned to grow in all economic cycles. As the economy encounters situations of recession, flattening yield curves and rising credit costs, our business may experience wider margins on principal asset sales, a favorable lending cycle for charged-off and nonperforming asset portfolios, higher volumes of nonperforming assets and building surplus inventories and bankruptcies. In times of economic growth, our business has demonstrated its ability to experience growth based on our competitive advantages in the industry, including our domain expertise related to deal sourcing and execution capabilities, our diversification of integrated service platforms and our experience across underserved markets. We intend to continue to leverage our competitive advantages to grow within each segment and across platforms through increasing synergies, maintaining high incremental margins, improving earnings predictability, strengthening financial metrics reflected on our balance sheet and managing expenses.

Our business strategy in the Specialty Lending and Auction and Liquidation segments includes the option of partnering with one or more additional purchasers or lenders, pursuant to a partnership, joint venture or limited liability company agreement (collectively, "Joint Ventures"). These Joint Ventures give us access to more opportunities, help to mitigate some of the competition from the market's larger participants, and contribute to our objective to be the leading resource for clients requiring financial and industrial asset solutions.

**Our Competitive Strengths**

We believe we have attributes that differentiate us from our competitors and that provide us with significant competitive advantages. Our key competitive strengths are described below.

***Differentiated business model.*** We believe we have diversified business lines serving the financial and industrial asset liquidation market. We have multiple revenue streams including our consumer and commercial loan brokerages, principal based auction services, refurbishment and resale, advisory services and secured lending services. Further, our business is event-driven and we have repeat, forward-flow contracts in place with industry leading customers. We expect to drive growth in our revenue streams by taking different roles, and using partners as needed.

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***Compelling macro growth drivers.*** Historically, recessions drive an increased supply of surplus assets and an increased demand for liquidation services, which we believe we are well-positioned to provide. Further, consumer revolving credit has increased above pre-pandemic levels, and credit card delinquencies and charge-offs have risen to at or above pre-pandemic benchmarks. While recent data indicate these metrics have begun to stabilize and, in some measures moderate, we believe credit card charge-offs and nonperforming receivables are likely to remain elevated. Under adverse macroeconomic conditions, delinquencies and charge-off rates could increase further, potentially expanding the supply of charged-off and nonperforming portfolios available for sale. Additionally, we believe an active market for mergers and acquisitions in manufacturing industries drives demand for industrial asset liquidations and our services. The market in which we operate is highly fragmented, presenting a continued opportunity for the Company to increase market share and drive consolidation.

***High return on invested capital.*** We believe we have an opportunity to drive improved auction economics by serving more frequently in the role of principal rather than the lower margin role of broker.

***Strong management team.*** We have built an experienced executive-level management team with deep domain expertise. Our President and Chief Executive Officer, Ross Dove, is a third-generation auctioneer and a pioneering innovator in applying technology to the asset liquidation industry. Mr. Dove began his career in the auction business over forty years ago, beginning with a small family-owned auction house and helping to expand it into a global firm, DoveBid, which was sold to a third party in 2008. In addition, our senior management team has deep domain expertise in both industrial asset and financial asset transactions. On September 17, 2020, we entered into an Employment Agreement with Kirk Dove, the former President and Chief Operating Officer of the Company. Upon his resignation, Kirk Dove continued his employment with us in an advisory capacity. Also, during 2020, Nick Dove was appointed as President, Industrial Assets Division, and David Ludwig was appointed as President, Financial Assets Division. Nick Dove previously served as Executive Vice President of Sales of Heritage Global Partners since August 2017. David Ludwig previously served as President of NLEX, a wholly owned subsidiary of the Company, and has served in such capacity since the Company acquired NLEX in 2014.

**Financial Assets Division**

Our Financial Assets Division provides services to issuers of consumer credit that are looking to monetize nonperforming and charged-off loans — loans that creditors have written off as uncollectable. Nonperforming and charged-off loans typically originate from banks that issue unsecured consumer credit.

***Consumer Loan Segment***

Through NLEX, we act as an advisor for sales of charged-off and nonperforming asset portfolios via an electronic auction exchange platform for banks and other debt holders throughout the United States and Canada. Since the 1980s, NLEX has sold over $250 billion face value of performing, nonperforming and charged-off assets. NLEX sales range from credit card, secured and unsecured consumer and business loans, and automobile defaults to real estate nonperforming loans. The typical credit we broker sells at a discount to face value, and we typically receive a commission for these services from both buyers and sellers. We have existing relationships with high quality, top-tier and mid-tier debt buyers. In addition to its creditor relationships, NLEX has continued to be opportunistic as new lending facilities, such as FinTech, peer-to-peer and more recently Buy Now Pay Later lenders have expanded the availability of consumer credit. Because of growing volume in this industry, and due to continued elevated delinquency and charge-off rates, we anticipate growth opportunities in our brokerage segment as these sectors evolve. Given many of our clients' limited resources in this space, we have also implemented post-sale support, further entrenching NLEX with our dedicated clients as well as differentiating us from competitors.

***Commercial Loan Segment***

Through DebtX, we provide end-to-end sale and valuation services for performing and non-performing commercial & industrial, commercial real estate, multifamily, and residential real estate loan portfolios. We facilitate the entire loan sale process from portfolio analysis and pricing, deal preparation, deal marketing, trade execution, and closing. We structure each loan sale to achieve optimal results for our clients, which typically includes a combination of highest price, certainty of execution, efficient timing, and data security and privacy.

***Specialty Lending Segment***

Through HGC, we provide specialty financing solutions to investors in charged-off and nonperforming asset portfolios. Since the inception of HGC in 2019, we have issued $160.7 million in total loans to investors by both self- funded loans and in partnership with senior lenders. Our portion of the total loans funded since inception is $74.3 million. Our income from secured lending consists of upfront fees, interest income, monthly monitoring fees and backend profit share. As of March 31, 2026, our net balance related to investments in loans to buyers of charged-off and nonperforming receivable portfolios was $26.3 million, of which $8.1 million is classified as notes receivable and $18.2 million is classified as equity method investments.

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***Specialty Lending - Concentration and credit risk*** 

As of March 31, 2026, we held a gross balance of investments in notes receivable of $27.3 million, recorded in both notes receivable and equity method investments, and consisting of one borrower's note balance of approximately $21.4 million, representing 78% of our total gross notes receivable balance as of March 31, 2026, as compared to 76% as of December 31, 2025. As discussed further above, our largest borrower is in default. As a result, the balance of the loans outstanding with our largest borrower were in nonaccrual status as of March 31, 2026. Whether we will realize any return with respect to the impacted loans is uncertain.

We do not evaluate concentration risk solely based on balance due from specific borrowers, but also consider the number of portfolio purchases, type of charged off accounts within the portfolio, and the seller of the portfolio when determining the overall risk. Of the balance due from one borrower of $21.4 million, there are 11 distinct loan agreements, the underlying portfolio of accounts are diversified throughout FinTech, installment loans and credit card accounts, and further diversified amongst six separate sellers of these charged off portfolios.

We mitigate this concentration risk by requiring, and monitoring, security from each borrower consisting of their charged off and nonperforming receivable portfolios. We engage in a due diligence process that leverages our valuation expertise, knowledge and experience in the underlying nonperforming receivable portfolios marketplace. In the event of default, we are entitled to call the unpaid interest and principal balances and receive all net collections directly. We may also recover our investment by engaging a third party to collect on the underlying charged off or nonperforming receivable portfolio or the underlying portfolio can be sold through our Consumer Loans segment. In certain cases, our recovery options may be subject to concurrence of the originator or other prior holder of the assets.

**Industrial Assets Division**

Our Industrial Assets Division advises enterprise and financial customers on the sale of industrial assets, mostly from surplus and sometimes distressed circumstances while acting as an agent, guarantor or principal in the sale.

***Auction and Liquidation Segment***

Through HGP, we offer a global full-service auction, appraisal and asset advisory firm, including the acquisition of turnkey manufacturing facilities and used industrial machinery and equipment. The fees for our services typically range from 15%–50%, depending on our role and the transaction. This division predominantly targets sellers of surplus or distressed "inside the building" assets. Our buyers consist of both end-users and dealers.

***Refurbishment & Resale Segment***

Through ALT, we have specialized our offering in the biotech and pharma sectors, which have been key verticals over the past decade. ALT focuses on refurbishing and reselling laboratory equipment.

Our management team has decades of domain expertise with the ability to leverage extensive industry relationships, real time access to databases of buyers and sales, as well as a deep understanding of the underlying asset value across the more than 25 industrial sectors in which we operate. We believe we have the opportunity for growth in our auction services through our ability to secure ongoing contracts with large multinational sellers, to be a first mover in emerging sectors, and to gain market share in sectors in which we are currently less active. Our extensive network and ability to find and source new opportunities are key factors for expansion. We believe we have the opportunity for growth in our valuation services through the addition of incremental bank-approved vendor lists, geographic expansion and through deeper penetration with our existing bank relationships.

**Government Regulation and Activities**

We are subject to federal, state and local consumer protection laws, including laws protecting the privacy of customer non-public information and regulations prohibiting unfair and deceptive trade practices. Many jurisdictions also regulate "auctions" and "auctioneers" and may regulate online auction services. These consumer protection laws and regulations could result in substantial compliance costs and could interfere with the conduct of our business.

Legislation in the United States has increased public companies' regulatory and compliance costs as well as the scope and cost of work provided by independent registered public accountants and legal advisors. As regulatory and compliance guidelines continue to evolve, we may incur additional costs in the future, which may or may not be material, in order to comply with legislative requirements or rules, pronouncements and guidelines by regulatory bodies.

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The current domestic and international political environment have contributed to uncertainty surrounding the future state of the global economy. While it is difficult to predict the ultimate effect of tariffs, trade disputes, and related matters on our business, to the extent that imported goods are subject to tariffs that reduce their availability and increase their price, demand may increase for the used industrial assets sold at our auctions, which could benefit our business. With respect to our Financial Assets Division, an economic downturn could increase the amount of distressed debt, which would tend to increase opportunities for our consumer loans, commercial loans and specialty lending businesses, but could also reduce the collectability of the charged off receivables purchased by our debt buyers, which would negatively affect our specialty lending business.

**Critical Accounting Policies and Estimates**

Management's Discussion and Analysis of Financial Condition and Results of Operations references our unaudited condensed consolidated interim financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP"). This requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements, as well as the reported amounts of revenues and expenses during the reporting period. Management bases its estimates and judgments on historical experience and various other factors that are believed to be reasonable under the circumstances. Actual results could differ from those estimates.

Significant estimates include the assessment of collectability of revenue recognized and the valuation of accounts receivable and notes receivable, inventory, investments, goodwill and intangible assets, liabilities, deferred income tax assets and liabilities including projecting future years' taxable income, and stock-based compensation. These estimates have the potential to significantly impact our consolidated financial statements, either because of the significance of the financial statement item to which they relate, or because they require judgment and estimation due to the uncertainty involved in measuring, at a specific point in time, events that are continuous in nature.

We have no off-balance sheet arrangements.

We have not paid any dividends, and do not expect to pay any dividends in the future.

***Business combinations***

Acquisitions are accounted for under ASC Topic 805, Business Combinations ("ASC 805"), which requires that assets acquired and liabilities assumed that are deemed to be a business are recorded based on their respective acquisition date fair values. ASC 805 further requires that separately identifiable intangible assets be recorded at their acquisition date fair values and that the excess of consideration paid over the fair value of assets acquired and liabilities assumed (including identifiable intangible assets) should be recorded as goodwill. Effective January 1, 2026 we acquired substantially all of the assets of The Debt Exchange Inc. for approximately $8.5 million. The purchase price allocation was based on an evaluation of the appropriate fair values and represents management's best estimate. See Note 3 to our condensed consolidated financial statements for further detail.

The critical accounting policies used in the preparation of our audited consolidated financial statements are discussed in our Form 10-K. Other than stated above, there were no material changes to these policies during the three months ended March 31, 2026.

**Management's Discussion of Financial Condition**

**Liquidity and Capital Resources**

***Liquidity***

We had working capital of $11.6 million and $18.1 million as of March 31, 2026 and December 31, 2025, respectively.

Our current assets as of March 31, 2026 decreased to $23.8 million compared to $33.6 million as of December 31, 2025. This change was primarily due to a decrease in cash of $8.9 million, as further discussed below, and a decrease in inventory of $0.6 million.

Our current liabilities as of March 31, 2026 decreased to $12.2 million compared to $15.5 million as of December 31, 2025. The most significant changes were a decrease of $2.0 million in payables to sellers due to the timing of certain asset liquidation settlements and a decrease of $1.4 million in accounts payable and accrued liabilities.

During the three months ended March 31, 2026, our primary source of cash was cash on hand and principal repayments on outstanding loans. Cash disbursements during the three months ended March 31, 2026 consisted primarily of approximately $8.5 million cash paid for the acquisition of substantially all of the assets of The Debt Exchange, Inc., investments in notes receivable, repurchases of our common stock, and capital expenditures related to improvements to our new building.

We believe we can fund our operations and our debt service obligations for 12 months from the date of filing this quarterly report and beyond through a combination of working capital, cash flows from our on-going operations and accessing financing from our existing line of credit.

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Our indebtedness consists of a promissory note, a business loan agreement and commercial security agreement (collectively, the "Mortgage Loan Agreement") with C3bank, National Association, that provides for a $4.1 million term loan (the "Mortgage") and any amounts borrowed under our 2021 Credit Facility.

On February 6, 2025 we entered into the Mortgage Loan Agreement with C3bank, National Association (the "Lender"). The Mortgage Loan Agreement provides for the Mortgage which we used to purchase real property and the building located at 6130 Nancy Ridge Drive in San Diego, California on February 11, 2025. This property is used as the Company's corporate headquarters and as a warehouse and office space for the operations of Heritage Global Partners, Inc., our subsidiary that operates our Auction and Liquidation segment. As of March 31, 2026, we had an outstanding balance of $4.1 million on the Mortgage.

On December 27, 2024, the Company entered into a Loan Modification Agreement and Reaffirmation of Loan (the "Sixth Modification Agreement"), by and between the Company and the Lender. The Sixth Modification Agreement modifies and reaffirms the 2021 Credit Facility to, among other things, extend the maturity date to June 27, 2026, modify the applicable interest rate, and further modify the loan covenants. We are permitted to use the proceeds of the loan solely for our business operations. As of March 31, 2026, we had no outstanding balance on the 2021 Credit Facility.

***Capital Resources***

As of March 31, 2026 and December 31, 2025, we had stockholders' equity of $67.8 million and $67.0 million, respectively.

We determine our future capital and operating requirements based upon our current and projected operating performance and contractual commitments. We expect to be able to finance our future operations through a combination of working capital, future net cash flows from operating activities and our 2021 Credit Facility. Our contractual requirements are limited to the outstanding debt and lease commitments with related and unrelated parties. Capital requirements are generally limited to our purchases of surplus and distressed assets and our investment activity under our Specialty Lending segment. We believe that our current capital resources, including available borrowing capacity from our 2021 Credit Facility is sufficient for these requirements. In the event additional capital is needed, we believe we can obtain additional debt financing through capital partners.

**Cash Position and Cash Flows**

Cash and cash equivalents as of March 31, 2026 were $11.6 million as compared to $20.5 million as of December 31, 2025, a decrease of approximately $8.9 million. The total cash amount reflected on our balance sheet represents the total cash and cash equivalents held on account. Cash amounts owed to our clients are identified as payables to sellers within current liabilities. We view cash net of payables to sellers as available for operations or investment purposes. As of March 31, 2026, payables to sellers was $5.3 million, resulting in a net cash available balance of $6.2 million compared to available cash of $13.2 million as of December 31, 2025.

***Cash Flows From Operating Activities***

Cash used in operating activities was $2.7 million during the three months ended March 31, 2026 as compared to cash provided by operating activities of $2.6 million during the same period in 2025. The approximate $5.3 million change was primarily attributable to a decrease in operating assets and liabilities of $4.1 million and a decrease of $1.2 million in net income adjusted for noncash items during the three months ended March 31, 2026 as compared to the same period in 2025.

The changes in operating assets and liabilities during the three months ended March 31, 2026 as compared to the same period in 2025 are primarily due to the nature of our operations. We earn revenue from discrete asset liquidation deals that vary considerably with respect to their magnitude and timing, and that can consist of fees, commissions, asset sale proceeds, or a combination thereof. The operating assets and liabilities associated with these deals are, therefore, subject to the same variability and can be quite different at the end of any given period.

***Cash Flows From Investing Activities***

Cash used in investing activities during the three months ended March 31, 2026 was $5.4 million compared to cash used in investing activities of $9.5 million during the same period in 2025.

Cash used in investing activities during the three months ended March 31, 2026 consisted primarily of the purchase price paid for the acquisition of substantially all of the assets of The Debt Exchange, Inc. of $8.5 million, the purchase of property and equipment of $0.6 million, and investments in notes receivable of $1.0 million. Cash used in investing activities during the three months ended March 31, 2026 was offset by payments received on notes receivable of $1.9 million, return of investment and cash distributions received from equity method investments of $2.1 million and return of investment in participating interest of $0.6 million.

Cash used in investing activities during the three months ended March 31, 2025 consisted primarily of purchase of property and equipment of $7.4 million, investments in notes receivable of $1.3 million, investment in equity method investments of $1.6 million and an investment in a participating interest of $1.6 million. Cash used in investing activities during the three months ended March 31, 2025 was offset by payments received on notes receivable of $1.6 million and return of investment and cash distributions received from equity method investments of $0.8 million.

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***Cash Flows From Financing Activities***

Cash used in financing activities was approximately $0.9 million during the three months ended March 31, 2026 compared to cash provided by financing activities of $3.9 million during the three months ended March 31, 2025. Financing activities during the three months ended March 31, 2026 consisted primarily of repayments of secured borrowing of $0.7 million and repurchases of our common stock of $0.1 million. Cash provided by financing activities during the three months ended March 31, 2025 consisted primarily of $4.1 million in proceeds from our Mortgage and $1.1 million of proceeds from secured borrowing, partially offset by $1.0 million in repurchases of our common stock.

**Contractual Obligations**

Our significant contractual obligations are our third party loans, client and partner asset liquidation settlement payments and lease obligations. The loan and lease obligations are fully described in the notes to the consolidated financial statements included in our Form 10-K.

**Management's Discussion of Results of Operations**

The following table sets out the Company's condensed consolidated results of operations for the three months ended March 31, 2026 and 2025 (in thousands).

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| | | | | |
|:---|:---|:---|:---|:---|
|  | **Three Months Ended March 31,** | **Three Months Ended March 31,** | **Change** | **Change** |
|  | **2026** | **2025** | **Dollars** | **Percent** |
| **Revenues:** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Services revenue | $6911 | $7648 | $(737) | (10)% |
| &nbsp;&nbsp;&nbsp;&nbsp;Asset sales | 5814 | 5811 | 3 | 0% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total revenues | 12725 | 13459 | (734) | (5)% |
| **Operating costs and expenses:** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Cost of services revenue | 1052 | 1675 | (623) | (37)% |
| &nbsp;&nbsp;&nbsp;&nbsp;Cost of asset sales | 3375 | 3773 | (398) | (11)% |
| &nbsp;&nbsp;&nbsp;&nbsp;Selling, general and administrative | 7619 | 6534 | 1085 | 17% |
| &nbsp;&nbsp;&nbsp;&nbsp;Depreciation and amortization | 174 | 118 | 56 | 47% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total operating costs and expenses | 12220 | 12100 | 120 | 1% |
| Earnings of equity method investments | 503 | 44 | 459 | 1043% |
| Operating income | 1008 | 1403 | (395) | (28)% |
| &nbsp;&nbsp;&nbsp;&nbsp;Interest (expense) income, net | (20) | 56 | (76) | (136)% |
| Income before income tax expense | 988 | 1459 | (471) | (32)% |
| Income tax expense | 271 | 395 | (124) | (31)% |
| **Net income** | $717 | $1064 | $(347) | (33)% |

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Our revenue has several components: (1) traditional fee based asset disposition services, such as commissions from on-line and webcast auctions, liquidations and negotiated sales, and commissions from the NLEX charged-off receivables business and from the DebtX loan sale business, (2) the acquisition and subsequent disposition of distressed and surplus assets, including industrial machinery and equipment and real estate, and (3) fees and interest earned for appraisal, management advisory services and specialty lending services.

We report segment information based on the "management" approach. The management approach designates the internal reporting used by the Chief Operating Decision Maker (CODM), which was determined to be Ross Dove, CEO, for making decisions and assessing performance as the source of our reportable segments. We manage our business primarily on differentiated revenue streams for services offered. Our reportable segments consist of the Auction and Liquidation segment, Refurbishment & Resale segment, Consumer Loans segment, Commercial Loans segment, and Specialty Lending segment. The Auction and Liquidation segment, through HGP, operates as a global full-service auction, appraisal and asset advisory firm, including the acquisition of turnkey manufacturing facilities and used industrial machinery and equipment. The Refurbishment & Resale segment, through ALT, acquires, refurbishes and supplies specialized laboratory equipment. The Consumer Loan segment, through NLEX, brokers charged-off receivables in the U.S. and Canada on behalf of financial institutions. The Commercial Loans segment, through DebtX provides loan sale advisement and valuation services. The Specialty Lending segment, through HGC, provides specialty financing solutions to investors in charged-off and nonperforming asset portfolios.

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Our CODM evaluates the performance of the Company's reportable segments based primarily on operating income and routinely receives internal reports that analyze operating income for the reporting segments. The CODM is not routinely provided detailed information regarding significant operating expenses by segment, and such information is not considered critical for allocating resources or assessing the performance of each segment. Our operating expenses are comprised mainly of fixed and variable compensation, marketing, outside services such as audit, legal and information technology, occupancy, and other regulatory costs incurred as a public entity. Additionally, earnings from equity method investments related to significant transactions involving real estate, machinery and equipment in the Company's Auction and Liquidation segment and Joint Venture lending activity related to the Company's Specialty Lending segment are significant in the computation of segment operating income and reported separately as shown in the table below.

Notwithstanding the foregoing, the reported segment operating income for ALT and HGC represents incremental costs for managing these segments as part of their sister segments (HGP for ALT and NLEX for HGC). As such, the reported operating income for ALT and HGC does not represent their true standalone contribution, as we do not attempt to allocate existing fixed divisional overhead costs of the sister divisions to the newer segments. Similarly, corporate overhead cost is not allocated to the operating divisions for management reporting purposes. Further, we do not utilize segmented asset information to evaluate the performance of our reportable segments and do not include intercompany transfers between segments for management reporting purposes.

The following table sets forth certain financial information for the Company's reportable segments for the three months ended March 31, 2026 and 2025 (in thousands):

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| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Three Months Ended March 31, 2026** | **Three Months Ended March 31, 2026** | **Three Months Ended March 31, 2026** | **Three Months Ended March 31, 2026** | **Three Months Ended March 31, 2026** | **Three Months Ended March 31, 2026** | **Three Months Ended March 31, 2026** |
|  | **Auction and Liquidation** | **Refurbishment & Resale** | **Consumer Loans** | **Commercial Loans** | **Specialty Lending** | **Corporate and other** | **Consolidated** |
| &nbsp;&nbsp;Gross profit [1] | $2395 | $1539 | $3488 | $649 | $227 | $— | $8298 |
| &nbsp;&nbsp;Operating expenses [2] | (2179) | (1032) | (1824) | (1255) | (270) | (1233) | (7793) |
| &nbsp;&nbsp;Earnings from equity method investments | 520 |  |  |  | (17) |  | 503 |
| &nbsp;&nbsp;**Operating income (loss)** | $**736** | $**507** | $**1664** | $**(606)** | $**(60)** | $**(1233)** | $**1008** |

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| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **Three Months Ended March 31, 2025** | **Three Months Ended March 31, 2025** | **Three Months Ended March 31, 2025** | **Three Months Ended March 31, 2025** | **Three Months Ended March 31, 2025** | **Three Months Ended March 31, 2025** |
|  | **Auction and Liquidation** | **Refurbishment & Resale** | **Consumer Loans** | **Specialty Lending** | **Corporate and other** | **Consolidated** |
| &nbsp;&nbsp;Gross profit [1] | $2876 | $1324 | $3378 | $368 | $65 | $8011 |
| &nbsp;&nbsp;Operating expenses [2] | (2125) | (1052) | (1778) | (353) | (1344) | (6652) |
| &nbsp;&nbsp;Earnings from equity method investments | (20) |  |  | 64 |  | 44 |
| &nbsp;&nbsp;**Operating income (loss)** | $**731** | $**272** | $**1600** | $**79** | $**(1279)** | $**1403** |

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[1] Within the Company's Industrial Asset division, management allocates gross profit resulting from certain auctions from Auctions and Liquidation (HGP) to Refurbishment & Resale (ALT). From time to time, ALT may source and refer an auction project to HGP or directly sell lab equipment inventory through the auction channel. In these instances, the profits relating to these transactions are allocated to ALT rather than accounted for under the segment profit or loss of HGP. During the three months ended March 31, 2026, the total amount of gross profit allocated to ALT from HGP was approximately $0.1 million, as compared to the total amount of gross profit allocated to ALT during the same period of 2025 of approximately $0.3 million.

[2] All financing arrangements are originated with Corporate and other. Management may determine from time to time that interest incurred from financing arrangements are directly attributable to a specific segment. As a result, interest incurred may be charged to the segment and included in that segment's profit or loss as a charge to operating expense. No interest expense has been allocated to operating segments during the three months ended March 31, 2026

------

or March 31, 2025.

***Three-Month Period Ended March 31, 2026 Compared to Three-Month Period Ended March 31, 2025***

**Revenues and cost of revenues –** Revenues were $12.7 million during the three months ended March 31, 2026 compared to $13.5 million during the same period in 2024. Costs of services revenue and asset sales were $4.4 million during the three months ended March 31, 2026 compared to $5.4 million during the three months ended March 31, 2025. The gross profit of these items was $8.3 million during the three months ended March 31, 2026 compared to $8.0 million during the same period in 2025, an increase of approximately $0.3 million, or approximately 4%. The increase in gross profit during the three months ended March 31, 2026 compared to the three months ended March 31, 2025 is primarily due to normal changes in the timing and magnitude of transactions, in addition to the inclusion of gross profit from DebtX beginning in the first quarter of 2026.

**Selling, general and administrative expense –** Selling, general and administrative expense was $7.6 million during the three months ended March 31, 2026 compared to $6.5 million during the same period in 2025.

Significant components of selling, general and administrative expense for the three months ended March 31, 2026 and 2025 are shown below (in thousands):

---

| | | | |
|:---|:---|:---|:---|
|  | **Three Months Ended March 31,** | **Three Months Ended March 31,** |  |
|  | **2026** | **2025** | **% change** |
| Compensation |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Auction and liquidation | $1547 | $1591 | (3)% |
| &nbsp;&nbsp;&nbsp;&nbsp;Refurbishment and resale | 665 | 753 | (12)% |
| &nbsp;&nbsp;&nbsp;&nbsp;Consumer loans | 1425 | 1362 | 5% |
| &nbsp;&nbsp;&nbsp;&nbsp;Commercial loans | 987 |  | 100% |
| &nbsp;&nbsp;&nbsp;&nbsp;Specialty lending | 243 | 302 | (20)% |
| &nbsp;&nbsp;&nbsp;&nbsp;Corporate and other | 563 | 623 | (10)% |
| &nbsp;&nbsp;&nbsp;&nbsp;Stock-based compensation | 211 | 279 | (24)% |
| Board of Directors fees | 123 | 123 | 0% |
| Accounting, tax and legal professional fees | 339 | 342 | (1)% |
| Insurance | 161 | 166 | (3)% |
| Occupancy | 397 | 330 | 20% |
| Travel and entertainment | 198 | 149 | 33% |
| Advertising and promotion | 220 | 172 | 28% |
| Information technology support | 323 | 168 | 92% |
| Provision for credit losses | (20) | (4) | (400)% |
| Other | 237 | 178 | 33% |
| **Total selling, general & administrative expense** | $7619 | $6534 | 17% |

---

Selling, general and administrative expense during the three months ended March 31, 2026 increased by approximately $1.1 million compared to the selling, general and administrative expense during same period of 2025. The increase in selling, general and administrative expense during the three months ended March 31, 2026 was primarily due to the acquisition of substantially all of the assets of The Debt Exchange, Inc.

**Depreciation and amortization expense –** Depreciation and amortization expense was approximately $0.2 million and $0.1 million during the three month periods ended March 31, 2026 and 2025, respectively.

**Earnings in Equity Method Investments –** Earnings in equity method investments were approximately $0.5 million and $44,000 during both the three months ended March 31, 2026 and 2025. The increase in earnings in equity method investments during the three months ended March 31, 2026 was primarily due to the seller's exercise of the purchase option to repurchase the real estate assets in the DLZ Solutions joint venture, as discussed in Note 7 - Equity Method Investments.

**Key Performance Indicators**

We monitor a number of financial and non-financial measures on a regular basis in order to track our underlying operational performance and trends. Other than operating income (a GAAP financial measure as shown in our consolidated statements of income),

------

which we believe is the most important measure of our operational performance and trends, we believe that EBITDA and Adjusted EBITDA (non-GAAP financial measures) are key performance indicators ("KPIs") for our business. These KPIs may not be defined or calculated in the same way as similar KPIs used by other companies.

We prepared our unaudited condensed consolidated financial statements in accordance with GAAP. We define EBITDA as net income plus depreciation and amortization, interest expense, and provision for income taxes. Adjusted EBITDA reflects EBITDA adjusted further to eliminate the effects of stock-based compensation. Management uses EBITDA and Adjusted EBITDA in assessing the Company's results, evaluating the Company's performance and in reaching operating and strategic decisions. Management believes that the presentation of EBITDA and Adjusted EBITDA, when considered together with our GAAP financial statements and the reconciliation to the most directly comparable GAAP financial measure, is useful in providing investors a more complete understanding of the factors and trends affecting the underlying performance of the Company on a historical and ongoing basis. Our use of EBITDA and Adjusted EBITDA is not meant to be, and should not be, considered in isolation or as a substitute for, or superior to, any GAAP financial measure. You should carefully evaluate the financial information below, which reconciles our GAAP reported net income to EBITDA and Adjusted EBITDA for the periods presented (in thousands).

---

| | | |
|:---|:---|:---|
|  | **Three Months Ended March 31,** | **Three Months Ended March 31,** |
|  | **2026** | **2025** |
| Net income | $717 | $1064 |
| Add back: |  |  |
| Depreciation and amortization | 174 | 118 |
| Interest expense (income), net | 20 | (56) |
| Income tax expense | 271 | 395 |
| **EBITDA** | 1182 | 1521 |
| Management add back: |  |  |
| Stock based compensation | 211 | 279 |
| **Adjusted EBITDA** | $1393 | $1800 |

---

**Item 3. Quantitative and Qualitative Disclosures about Market Risk.**

As a Smaller Reporting Company, we are not required to provide the information required by this item.

**Item 4. Controls and Procedures.**

As of the end of the period covered by this Report, our Chief Executive Officer and Principal Financial Officer (the "Certifying Officers") conducted evaluations of our disclosure controls and procedures. As defined in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), the term "disclosure controls and procedures" means controls and other procedures of an issuer that are designed to ensure that information required to be disclosed by the issuer in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC's rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Exchange Act is accumulated and communicated to the issuer's management, including the Certifying Officers, to allow timely decisions regarding required disclosure. Based on this evaluation, the Certifying Officers have concluded that our disclosure controls and procedures were effective as of March 31, 2026.

Further, there were no changes in our internal control over financial reporting during the three months ended March 31, 2026 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

------

**PART II – OTHER INFORMATION**

**Item 1. Legal Proceedings**

There have been no material changes to the legal proceedings discussed in our Form 10-K.

**Item 1A. Risk Factors**

As a Smaller Reporting Company, we are not required to provide the information required by this item.

**Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.**

The Company repurchased 106,799 shares in the open market during the three months ended March 31, 2026 pursuant to the 2025 Repurchase Program. As of March 31, 2026, the Company had approximately $7.4 million in remaining aggregate dollar value of shares that may be purchased under the 2025 Repurchase Program. The following table presents the number and average price of shares purchased in each fiscal month during the three months ended March 31, 2026:

---

| | | | | |
|:---|:---|:---|:---|:---|
| **Period** | **(a) Total Number of Shares Purchased [1]** | **(b) Average Price Paid per Share [2]** | **(c) Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs** | **(d) Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs [3]** |
| January 1 through January 31, 2026 |  | $— |  | $7500000 |
| February 1 through February 28, 2026 |  |  |  | 7500000 |
| March 1 through March 31, 2026 | 106799 | 1.32 | 106799 | 7359008 |
| &nbsp;&nbsp;**Total** | 106799 | $1.32 | 106799 | $7359008 |
| [1] No shares of our common stock were purchased other than through a publicly announced plan or program. | [1] No shares of our common stock were purchased other than through a publicly announced plan or program. | [1] No shares of our common stock were purchased other than through a publicly announced plan or program. | [1] No shares of our common stock were purchased other than through a publicly announced plan or program. | [1] No shares of our common stock were purchased other than through a publicly announced plan or program. |
| [2] Amounts in this column reflect weighted average price paid per share, which includes commissions and other expenses associated with the repurchases. | [2] Amounts in this column reflect weighted average price paid per share, which includes commissions and other expenses associated with the repurchases. | [2] Amounts in this column reflect weighted average price paid per share, which includes commissions and other expenses associated with the repurchases. | [2] Amounts in this column reflect weighted average price paid per share, which includes commissions and other expenses associated with the repurchases. | [2] Amounts in this column reflect weighted average price paid per share, which includes commissions and other expenses associated with the repurchases. |
| [3] Our Board of Directors previously authorized a share repurchase program (the "2025 Repurchase Program"), which permits the Company to purchase up to an aggregate of $7.5 million in common shares through June 30, 2028. This column reflects the dollar value of shares of our common stock that are available for purchase under the 2025 Repurchase Program. | [3] Our Board of Directors previously authorized a share repurchase program (the "2025 Repurchase Program"), which permits the Company to purchase up to an aggregate of $7.5 million in common shares through June 30, 2028. This column reflects the dollar value of shares of our common stock that are available for purchase under the 2025 Repurchase Program. | [3] Our Board of Directors previously authorized a share repurchase program (the "2025 Repurchase Program"), which permits the Company to purchase up to an aggregate of $7.5 million in common shares through June 30, 2028. This column reflects the dollar value of shares of our common stock that are available for purchase under the 2025 Repurchase Program. | [3] Our Board of Directors previously authorized a share repurchase program (the "2025 Repurchase Program"), which permits the Company to purchase up to an aggregate of $7.5 million in common shares through June 30, 2028. This column reflects the dollar value of shares of our common stock that are available for purchase under the 2025 Repurchase Program. | [3] Our Board of Directors previously authorized a share repurchase program (the "2025 Repurchase Program"), which permits the Company to purchase up to an aggregate of $7.5 million in common shares through June 30, 2028. This column reflects the dollar value of shares of our common stock that are available for purchase under the 2025 Repurchase Program. |

---

**Item 3. Defaults Upon Senior Securities.**

None.

**Item 4. Mine Safety Disclosures.**

Not applicable.

**Item 5. Other Information.**

***Rule 10b5-1 Trading Plans of Directors and Section 16 Officers***

During the fiscal quarter ended March 31, 2026, none of our directors or officers (as defined in Exchange Act Rule 16a-1(f)) adopted or terminated a "Rule 10b5-1 trading arrangement" or "non-Rule 10b5-1 trading arrangement" (in each case, as defined in Item 408 of Regulation S-K).

------

**Item 6. Exhibits.**

**(a) Exhibits**

---

| | |
|:---|:---|
| **Exhibit No.** | **Identification of Exhibit** |
| 3.1 | [<u>Second Amended and Restated Articles of Incorporation (filed as Exhibit 3.1 to the Company's Current Report on Form 8-K filed on June 7, 2024 (File No. 001-39471), and incorporated herein by reference)</u>](https://www.sec.gov/ix?doc=/Archives/edgar/data/849145/000095017024070068/hgbl-20240606.htm) |
| 3.2 | [<u>Restated Bylaws, as amended (filed as Exhibit 3.1 to the Company's Current Report on Form 8-K filed on September 30, 2020 (File No. 001-39471), and incorporated herein by reference).</u>](https://www.sec.gov/Archives/edgar/data/0000849145/000156459020045254/hgbl-ex31_6.htm) |
| 4.1 | [<u>Warrant Agreement by and between Heritage Global Inc. and Napier Park Industrial Asset Acquisition, LP, effective as of March 19, 2019 (filed as Exhibit 4.1 to the Company's Current Report on Form 8-K filed on March 25, 2019 (File No. 000-17973), and incorporated herein by reference).</u>](https://www.sec.gov/Archives/edgar/data/849145/000156459019009172/hgbl-ex41_129.htm) |
| 10.1<br>| [<u>Asset Purchase Agreement, dated January 9, 2026, by and between Heritage DebtX LLC and The Debt Exchange, Inc. (filed as Exhibit 10.1 to the Company's Current Report on Form 8-K filed on January 12, 2026 (File No. 001-39471), and incorporated herein by reference).</u>](hgbl-ex10_1.htm) |
| 10.2<br>| [<u>Employment Agreement, dated January 9, 2026, by and between Heritage DebtX LLC and Bruce Hounsell (filed as Exhibit 10.2 to the Company's Current Report on Form 8-K filed on January 12, 2026 (File No. 001-39471), and incorporated herein by reference).</u>](hgbl-ex10_2.htm) |
| 31.1  | [<u>Certification of Principal Executive Officer pursuant to Rule 13a-14(a) and 15d-14(a) as adopted under Section 302 of the Sarbanes-Oxley Act of 2002</u>](hgbl-ex31_1.htm) |
| 31.2 | [<u>Certification of Principal Financial Officer pursuant to Rule 13a-14(a) and 15d-14(a) as adopted under Section 302 of the Sarbanes-Oxley Act of 2002</u>](hgbl-ex31_2.htm) |
| 32.1 | [<u>Certification of Principal Executive Officer pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002</u>](hgbl-ex32_1.htm) |
| 32.2 | [<u>Certification of Principal Financial Officer pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002</u>](hgbl-ex32_2.htm) |
| 101.INS  | Inline XBRL Instance Document  |
| 101.SCH  | Inline XBRL Taxonomy Extension Schema Document |
| 101.CAL  | Inline XBRL Taxonomy Extension Calculation Linkbase Document |
| 101.DEF  | Inline XBRL Taxonomy Extension Definition Linkbase Document |
| 101.LAB  | Inline XBRL Taxonomy Extension Labels Linkbase Document |
| 101.PRE  | Inline XBRL Taxonomy Extension Presentation Linkbase Document |
| 104  | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) |

---

\* Filed herewith

------

**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 thereunder duly authorized.

---

| | | |
|:---|:---|:---|
|  | **<u>Heritage Global Inc.</u>** | **<u>Heritage Global Inc.</u>** |
| Date: May 7, 2026 | By: | /s/ Ross Dove |
|  |  | Ross Dove |
|  |  | Chief Executive Officer |
|  |  | (Principal Executive Officer) |
|  | By: | /s/ Brian J. Cobb |
|  |  | Brian J. Cobb |
|  |  | Chief Financial Officer |
|  |  | (Principal Financial Officer and Principal Accounting Officer)  |

---

------

## Exhibit 10.1

Exhibit 10.1

**<u>________________________________________________________________________</u>**

**ASSET PURCHASE AGREEMENT**

**BY AND AMONG**

**HERITAGE DEBTX LLC, AND**

**THE DEBT EXCHANGE, INC.**

**DATED AS OF JANUARY 9, 2026**

**<u>________________________________________________________________________</u>**

------

**TABLE OF CONTENTS**

---

| | | |
|:---|:---|:---|
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Article I. DEFINITIONS** | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Article I. DEFINITIONS** | **1** |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.1 | Certain Definitions | 1 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.2 | Table of Defined Terms | 7 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Article II. PURCHASE AND SALE** | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Article II. PURCHASE AND SALE** | **9** |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.1 | Purchase and Sale of Assets | 9 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2 | Assumption of Liabilities | 10 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.3 | Closing | 11 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.4 | Closing Payments; Actions and Deliveries | 11 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.5 | Post-Reference Time Payment | 11 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.6 | Closing Deliverables | 12 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.7 | Withholding | 13 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.8 | Allocation of Consideration | 13 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Article III. REPRESENTATIONS AND WARRANTIES OF SELLER** | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Article III. REPRESENTATIONS AND WARRANTIES OF SELLER** | **14** |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.1 | Organization and Qualification | 14 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.2 | Governing Documents | 15 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.3 | Capitalization | 15 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.4 | Subsidiaries | 15 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.5 | Authority; Enforceability | 15 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.6 | Indebtedness; Seller Transaction Expenses | 15 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.7 | No Conflict; Required Filings and Consents | 15 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.8 | Material Contracts | 16 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.9 | Compliance with Laws | 17 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.10 | Financial Statements | 17 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.11 | Absence of Certain Changes and Events | 18 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.12 | Absence of Litigation, Claims and Orders | 18 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.13 | Employee Benefit Plans | 18 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.14 | Labor Matters | 19 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.15 | Real Property. | 19 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.16 | Taxes | 20 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.17 | Intellectual Property and Information Privacy and Security Laws | 20 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.18 | Customers and Suppliers | 23 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.19 | Insurance | 23 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.20 | Brokers | 23 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.21 | Affiliated Transactions | 23 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.22 | Ownership and Sufficiency of Assets | 24 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.23 | Solvency | 24 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Article IV. REPRESENTATIONS AND WARRANTIES OF PURCHASER** | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Article IV. REPRESENTATIONS AND WARRANTIES OF PURCHASER** | **24** |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.1 | Organization | 24 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.2 | Authority; Enforceability | 24 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.3 | No Conflict; Required Filings and Consents | 24 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.4 | Absence of Litigation, Claims and Orders | 25 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.5 | Brokers | 25 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Article V. COVENANTS** | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Article V. COVENANTS** | **25** |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.1 | Further Assurances | 25 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.2 | Publicity | 25 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.3 | Customer and Business Relationships | 25 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.4 | Expenses | 25 |

---

ii

------

---

| | | |
|:---|:---|:---|
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.5 | Restrictive Covenants. | 26 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.6 | Certain Assigned Contracts | 27 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.7 | Names; Domain Name | 28 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.8 | Receivables | 28 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.9 | Bulk Sales Laws | 28 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.10 | Pre-Closing Taxes | 29 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.11 | Transfer Taxes | 29 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.12 | Cooperation | 29 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.13 | Payment of Other Excluded Liabilities | 29 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.14 | Seller Release | 29 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Article VI. INDEMNIFICATION** | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Article VI. INDEMNIFICATION** | **30** |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.1 | Survival | 30 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.2 | Indemnification and Reimbursement by Seller | 30 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.3 | Indemnification and Reimbursement by Purchaser | 30 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.4 | Limitations | 31 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.5 | Third-Party Claims | 32 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.6 | Order of Recovery | 33 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.7 | Release of Escrow Funds in Escrow Account | 34 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.8 | Exclusive Remedy | 34 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.9 | Treatment of Indemnification Payments | 34 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Article VII. MISCELLANEOUS** | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Article VII. MISCELLANEOUS** | **34** |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.1 | Amendment | 34 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.2 | Waiver | 35 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.3 | Notices | 35 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.4 | Enforcement of Agreement | 36 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.5 | Headings; Construction | 36 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.6 | Severability | 36 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.7 | Entire Agreement | 36 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.8 | Assignment | 36 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.9 | No Third Party Beneficiaries | 37 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.10 | Governing Law; Venue | 37 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.11 | Waiver of Jury Trial | 37 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.12 | Execution of Agreement; Counterparts | 37 |

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**<u>Annexes</u>**

Annex A Excluded Assets

Annex B Tax Allocation Methodology

**<u>EXHIBITS</u>**

Exhibit A Form of Bill of Sale and Assignment

Exhibit B Form of Escrow Agreement

**<u>SCHEDULES</u>**

Schedule 2.1(a)(ii) Excluded Contracts

Schedule 2.2(b)(ii) Employee Sale Bonuses

Schedule 2.7(a)(vi) Required Third Party Consents

iii

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**ASSET PURCHASE AGREEMENT**

This **Asset Purchase Agreement** (this "<u>Agreement</u>"), is made and entered into on January 9, 2026, by and among **HERITAGE DEBTX LLC**, a Delaware limited liability company ("<u>Purchaser</u>"), and The Debt Exchange, Inc., a Delaware corporation ("<u>Seller</u>"). Purchaser and Seller shall be referred to herein collectively as the "<u>Parties</u>" and individually as a "<u>Party</u>."

**WHEREAS**, Purchaser desires to purchase from Seller, and Seller desires to sell to Purchaser, all or substantially all of the assets of the Business, on the terms and subject to the conditions set forth herein.

**NOW, THEREFORE**, in consideration of the foregoing and the mutual representations, warranties, covenants and agreements herein contained, and intending to be legally bound hereby, the Parties agree as follows:

# Article I. <br>DEFINITIONS
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.1 <u>Certain Definitions</u>. For purposes of this Agreement, the following terms shall have the following meanings:

"**<u>Affiliate</u>**" means, with respect to any specified Person (a) who is an individual, the spouse or lineal descendent of such Person, and (b) that is an entity, any other Person that, directly or indirectly through one or more intermediaries, controls, or is controlled by, or is under common control with, such specified Person. For purposes of this definition, "control" of a Person shall mean the direct or indirect power to direct or cause the direction of the management and policies of such Person whether by ownership of voting securities, by Contract or otherwise. As it relates to Seller, "Affiliate" specifically does not include DebtX Software Solutions, Inc. or DebtX Analytics, Inc.

"**<u>Base Purchase Price</u>**" means $8,450,000.00.

"**<u>Business</u>**" means the business of full service loan sale advisory services for commercial and consumer debt.

"**<u>Business Day</u>**" means any day other than a Saturday, Sunday or day on which national banking institutions are permitted or required to close in the State of New York.

"**<u>Business Records</u>**" means all files, documents, instruments, Contracts, papers, books, reports, records and other materials owned by Seller that are in any such Seller's possession, or any of their respective Affiliates' possession which are not located at the real property of Seller; <u>provided</u>, <u>however</u>, that the Business Records shall not include the Tax Returns of Seller related to Income Taxes.

"**<u>Claim</u>**" means any claim, lawsuit, action, arbitration, cause of action, complaint, allegation, criminal prosecution, investigation, demand letter, hearing, charge or proceeding, whether at law or at equity, before or by any Court or Governmental Authority, any arbitrator or other tribunal.

"**<u>Claim Notice</u>**" means written notification that includes (i) a description of the Loss incurred or reasonably expected to be incurred by the Indemnified Person, a reasonably specific description of the basis therefor and the claimed amount of such Loss incurred or reasonably expected to be incurred by the Indemnified Person, to the extent then known, (ii) a statement that the Indemnified Person is entitled to indemnification under <u>Article VII</u> for such Loss and a reasonable explanation of the basis therefor, and (iii) a demand for payment in the amount of any such Loss to the extent actually incurred.

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**"<u>COBRA</u>"** means the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended.

"**<u>Code</u>**" means the U.S. Internal Revenue Code of 1986, as amended.

"**<u>Competing Business</u>**" means any organization or business engaged in the Business or that otherwise provides products or services that are the same as or competitive with those provided by the Business.

"**<u>Confidential Information</u>**" means any proprietary or otherwise confidential information of or regarding Seller, Purchaser, any Affiliates of Seller or Purchaser, and any of their respective businesses, including the Business, whether or not such information is in writing and marked as "confidential" or "proprietary." For the avoidance of doubt, Confidential Information shall include information relating to: (i) marketing or distribution data, (ii) business methods, plans and efforts, (iii) personnel data, (iv) the identity of, or courses of dealings or contracts with, actual or potential business relations, (v) financial statements or other financial information, (vi) computer databases, software programs and information relating to the nature of the hardware or software and how such hardware or software is used in combination or alone, (vii) servicing methods, equipment, programs, analyses or profit margins, and (viii) information received by such party from a third party subject to the terms of a confidentiality, non-disclosure or similar agreement or with the reasonable expectation that such information would be treated as confidential or proprietary information.

"**<u>Confidentiality Agreement</u>**" means that Non-Disclosure Agreement by and between Purchaser and Seller, dated as of September 1, 2023.

"**<u>Contract</u>**" means any contract, agreement, indenture, note, bond, loan, mortgage, license, instrument, lease, understanding, commitment, or other arrangement or agreement, whether written or oral.

"**<u>Court</u>**" means any court or arbitration tribunal of the United States, any domestic state, any foreign country and any political subdivision or agency thereof.

"**<u>Disclosure Schedule</u>**" means the Disclosure Schedule delivered by Seller to Purchaser concurrently with the execution of this Agreement.

"**<u>Equity Interests</u>**" means, with respect to any Person, any share, unit, capital stock, limited liability company interest, membership interest, partnership interest, share capital, or similar interest or other indicia of equity or equity-like ownership in or share in the capital of such Person, including any option, warrant or similar right or security convertible, exchangeable or exercisable therefor or other instrument or right the value of which is based on any of the foregoing.

"**<u>Escrow Agreement</u>**" means the escrow agreement by and among Seller, Purchaser, Escrow Agent substantially in the form attached hereto as <u>Exhibit B</u>.

"**<u>Escrow Agent</u>**" means U.S. Bank National Association, a national banking association.

"**<u>Escrow Amount</u>**" means an amount equal to the sum of the General Escrow Amount and the Patent Litigation Escrow Amount.

"**<u>Fraud</u>**" means a representation or warranty made by a Party in this Agreement that (i) is false; (ii) is made with actual knowledge that such representation or warranty is false at the time it is made; (iii) is made with the intent to deceive; (iv) such other party reasonably and justifiably relies upon; and (v) such other Party incurs Losses a result of such reliance.

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"**<u>GAAP</u>**" means United States generally accepted accounting principles in effect from time to time, consistently applied by Seller.

"**<u>General Escrow Account</u>**" means the segregated escrow account into which the Escrow Agent shall deposit the General Escrow Amount at the Closing.

"**<u>General Escrow Amount</u>**" means $1,000,000.00.

"**<u>Governing Documents</u>**" means, with respect to any particular entity: (i) if a corporation, the articles or certificate of incorporation and the bylaws; (ii) if a general partnership, the partnership agreement and any statement of partnership existence; (iii) if a limited partnership, the limited partnership agreement and the certificate of limited partnership; (iv) if a limited liability company, the articles of organization or certificate of formation and operating agreement; (v) if a trust, the trust agreement and any other formation documents; (vi) if another type of Person, any other charter or similar document adopted or filed in connection with the creation, formation or organization of the Person; (vii) all equityholders' agreements, voting agreements, voting trust agreements, joint venture agreements, registration rights agreements or other agreements or documents relating to the organization, management or operation of any Person or relating to the rights, duties and obligations of the equityholders of any Person; and (viii) any amendment or supplement to any of the foregoing.

"**<u>Governmental Approval</u>**" means any consent, approval, Order or authorization of, or registration, declaration or filing with, any Governmental Authority.

"**<u>Governmental Authority</u>**" means any domestic or foreign federal, state, provincial, municipal, or local government, or political subdivision thereof, or any multinational organization or authority, or any other authority, agency or commission (including any professional accreditation organization or professional standards setting organization or any other similar body) entitled to exercise any administrative, executive, judicial, legislative, police, regulatory or taxing authority or power, any court or tribunal (or any department, bureau or division thereof), or any arbitrator or arbitral body.

"**<u>GPE Patent Litigation Matter</u>**" means the "GPE Patent Litigation Matter" as defined in the Disclosure Schedule.

"**<u>Income Taxes</u>**" means any U.S. federal, state, local, or non-U.S. Tax based upon or measured by, in whole or in part, net income and any similar Tax.

"**<u>Indebtedness</u>**" means, all liabilities and indebtedness of Seller, including, but not limited to: (i) all obligations for borrowed money or in respect of loans or advances; (ii) all obligations evidenced by bonds, debentures, notes or other similar instruments or debt securities; (iii) all obligations arising out of interest rate and currency swap arrangements and any other arrangements designed to provide protection against fluctuations in interest or currency rates; (iv) all obligations in respect of letters of credit or bankers' acceptances, performance bonds, sureties or similar obligations; (v) all obligations, contingent or otherwise, arising from deferred compensation arrangements, commission, severance or bonus plans or arrangements, Employee Plans, employment agreements or similar arrangements, including any of the foregoing that are payable as a result of the consummation of the transactions contemplated hereby; (vi) all obligations recorded or required to be recorded as lessee under any lease or similar arrangement required to be recorded as a capital lease or finance lease in accordance with GAAP; (vii) all obligations for the deferred purchase price of property or services or the acquisition of a business or portion thereof, whether contingent or otherwise, as obligor or otherwise, at the maximum amount payable in respect thereof, regardless of whether such amount is contingent on future performance; (viii) all obligations created or arising under any conditional sale or other title retention agreement with respect to acquired property; (ix) all obligations arising from cash or book overdrafts; (x) all accrued interest, prepayment premiums, fees, penalties,

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expenses or other amounts payable in respect of any of the foregoing; and (xi) guarantees of such Person of any such Indebtedness referred to in clauses (i)-(x) of any other Person. Notwithstanding the foregoing, with respect to Seller, such amounts shall be calculated without duplication of any amount included in the definition of Seller Transaction Expenses.

"**<u>Information Privacy and Security Laws</u>**" means all applicable Laws concerning the collection, privacy, protection, processing, storage, access, use, exchange, disclosure, transfer, disposal, and/or security of Personal Information, including all such Laws governing privacy, data security, data, or security breach notification.

"**<u>IP Licenses</u>**" means, collectively, (i) Contracts for Licensed Intellectual Property and (ii) Outbound IP Licenses.

"**<u>IP Rights</u>**" means any and all right, title, and interest in intellectual property in the Acquired Assets throughout the world, including: (i) all issued patents, patent applications (whether provisional or non-provisional), and any other Governmental Authority-issued indicia of invention ownership, together with all counterparts, reissues, divisions or divisionals, continuations, continuations-in-part, extensions, restorations of any of the foregoing, industrial designs, substitutions, or supplemental protection certificates, renewals, and reexaminations thereof ("<u>Patents</u>"); (ii) "trade secrets" as defined under the Uniform Trade Secret Act, including all inventions (whether patentable or not), discoveries, invention disclosures, and improvements, all trade secrets, proprietary or confidential information, know-how, business and technical information, databases, data compilations and collections, tools, methods, processes, techniques, and technology and all rights therein, which Seller derives value from maintaining in confidence ("<u>Trade Secrets</u>"); (iii) all copyrightable works of authorship and copyrights,, including database, and design rights, whether or not registered or published, all registrations and recordations thereof, and all applications in connection therewith, along with all reversions, extensions, and renewals thereof ("<u>Copyrights</u>"); (iv) Software; (v) all internet domain names, any associated web addresses, URLs, websites, and webpages, social media sites and pages ("<u>Domain Names</u>"); (vi) all corporate names, trade names, logos, trademarks, service marks, trade dress, brands, certification marks and other source identifiers, including all registrations, renewals, and applications therefor, and all goodwill associated with any of the foregoing ("<u>Trademarks</u>"); (vii) mask works, mask work registrations and applications, and (viii) all other intellectual property and proprietary rights of any kind whatsoever, including the right to sue for and recover remedies against past, present, and future infringements of any or all of the foregoing.

"**<u>Knowledge of Seller</u>**" means the actual knowledge of William Looney, Bruce Hounsell, Kevin Kelley, and Charles Hunter.

"**<u>Law</u>**" means all laws, statutes, ordinances, directives, rules, regulations, policies or interpretations (regarding any such rule, regulation or policy) and similar mandates of any Governmental Authority, including all Orders having the effect of law in any jurisdiction.

"**<u>Licensed Intellectual Property</u>**" means all IP Rights licensed to Seller pursuant to a Contract with a third party.

"**<u>Lien</u>**" means any lien, charge, pledge, claim, encumbrance, security interest, mortgage, deed of trust, demand, lease, license, option, warrant, call, right of first refusal, easement, servitude, transfer restriction or any other encumbrance, restriction or limitation whatsoever; provided, however, that the term "Lien" shall not include (i) liens for Taxes that are not yet due and payable or that being contested pursuant to appropriate proceeding for which adequate reserves have been established in accordance with GAAP, (ii) liens in favor of carriers, warehousemen, mechanics and materialmen, or other similar liens incurred in the Ordinary Course of Business, in each case for amounts which are not yet due, and (iii) non-exclusive Outbound IP Licenses or Outbound IP Licenses granted in the Ordinary Course of Business.

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"**<u>Losses</u>**" means any readily quantifiable, non-speculative damages, losses, obligations, liabilities, claims, encumbrances, penalties, costs, Taxes and expenses, including costs of investigation and defense and reasonable attorneys' fees and expenses, but does not include any changes in the stock price or value of the Purchaser's parent company, Heritage Global Inc.

"**<u>Material Adverse Effect</u>**" means any event, occurrence, fact, condition or change that is, or could reasonably be expected to become, individually or in the aggregate, materially adverse to (a) the business, results of operations, condition (financial or otherwise) or assets of the Business; (b) the value of the Acquired Assets; or (c) the ability of Seller to consummate the transactions contemplated hereby on a timely basis; <u>provided</u>, <u>however</u>, that "Material Adverse Effect" shall not include any event, occurrence, fact, condition or change, directly or indirectly, arising out of or attributable to: (i) general economic or political conditions; (ii) conditions generally affecting the industries in which the Business operates; (iii) any changes in financial or securities markets in general; (iv) acts of war (whether or not declared), armed hostilities or terrorism, or the escalation or worsening thereof; (v) any action required or permitted by this Agreement; (vi) any changes in applicable Laws; or (vii) the public announcement, pendency or completion of the transactions contemplated by this Agreement; provided further, however, that any event, occurrence, fact, condition or change referred to in clauses (i) through (iv) immediately above shall be taken into account in determining whether a Material Adverse Effect has occurred or could reasonably be expected to occur to the extent that such event, occurrence, fact, condition or change has a disproportionate effect on the Business compared to other participants in the industries in which the Business operates.

"**<u>Open Source Software</u>**" means any Software subject to a license or other Contract meeting the Open Source Definition (as promulgated by the Open Source Initiative) or the Free Software Definition (as promulgated by the Free Software Foundation).

"**<u>Order</u>**" means any binding judgment, order, decision, writ, injunction, ruling or decree of, or any settlement under the jurisdiction of, any Court or Governmental Authority.

"**<u>Ordinary Course of Business</u>**" means the ordinary course of business of a Person, consistent with past practice and custom (including with respect to frequency, volume and amount, as applicable).

"**<u>Outbound IP Licenses</u>**" means all Contracts to which Seller is a party and pursuant to which any Person is authorized to use or exploit or is granted a license or any other right to any Seller-Owned Intellectual Property, including any joint development agreements, or any Contracts pursuant to which Seller has agreed to any transfer of the Seller-Owned Intellectual Property or restriction of or on Seller's rights to use or enforce any rights with respect to Seller-Owned Intellectual Property.

"**<u>Patent Litigation Escrow Account</u>**" means the segregated escrow account into which the Escrow Agent shall deposit the Patent Litigation Escrow Amount at the Closing.

"**<u>Patent Litigation Escrow Amount</u>**" means $500,000.00.

"**<u>Permits</u>**" means, with respect to any Person, any license, designation, franchise, permit, consent, approval, registration, qualification, accreditation, certificate or other similar authorization issued or otherwise granted by any Governmental Authority, professional accreditation organization, professional standards setting organization or any other similar body, in each case, to which or by which such Person or any property, business, operation, or right of such Person is subject or bound.

"**<u>Person</u>**" means any individual, corporation, limited liability company, partnership (general or limited), association, trust or any other entity or organization, including any Governmental Authority.

"**<u>Personal Information</u>**" means any information that identifies (alone or in combination with other information), is linked to, or relates to an individual, or is reasonably capable of being associated with an

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individual, including any information that is governed, regulated or protected by one or more Information Privacy and Security Laws concerning information relating to an identified or identifiable natural person.

**"<u>Post-Reference Time Period</u>"** means the period beginning immediately after the Reference Time and ending immediately prior to the Effective Time.

"**<u>Pre-Closing Tax Period</u>**" means all taxable periods (or portions thereof) ending on or before the Closing Date and, with respect to any Straddle Period, the portion of such Straddle Period ending at the end of the day on the Closing Date.

"**<u>Proceeding</u>**" means any cause of action, charge, arbitration, audit, hearing, investigation, litigation, or lawsuit (whether civil, criminal, administrative, judicial or investigative, whether formal or informal, whether public or private).

"**<u>Reference Time</u>**" means 11:59:59 p.m. (Eastern Time) on December 31, 2025.

**"<u>Regus Deposit Reimbursement Amount</u>"** means $9,968, which is the amount equal to the sum of the deposit paid by Seller (and that Purchaser shall retain following the Closing) pursuant to that certain Service Agreement, dated October 23, 2023, by and between Regus Management, Group, LLC, as landlord, and Seller, as tenant, as amended by that certain Renewal Service Agreement, dated June 9, 2025, and that certain Renewal Service Agreement, dated November 9, 2025, for the real property located at 275 Grove Street, Suite 2-400, Newton, MA 02466.

"**<u>Restricted Territory</u>**" means (i) any state in the United States in which the Business is conducted and (ii) to the extent evidenced by written business plans dated as of prior to the Closing Date, any state in the United States in which the Business has made plans to conduct the Business.

"**<u>Seller Intellectual Property</u>**" means all IP Rights that are used or held for use in the operation of the Business, including all (i) Seller-Owned Intellectual Property, (ii) Registered Intellectual Property, and (iii) Licensed Intellectual Property.

"**<u>Seller-Owned Intellectual Property</u>**" means all IP Rights, all IP Rights in Seller Products, and Seller Software, in each case that are owned or purported to be owned by Seller.

"**<u>Seller Product</u>**" means all products and services currently made commercially available, marketed, distributed, sold, or licensed out by Seller.

"**<u>Seller Software</u>**" means all Software owned or purported to be owned by, or developed by or on behalf of, Seller, including customizations to third-party Software created or developed by or on behalf of Seller.

"**<u>Seller Transaction Expenses</u>**" means, in each case solely to the extent not paid by Seller prior to the Closing, and whether or not invoiced, (i) the fees and expenses payable by Seller to any advisors to Seller in connection with this Agreement and the transactions and other agreements contemplated by this Agreement, (ii) the fees and expenses payable by Seller to any attorneys engaged by Seller in connection with this Agreement and the transactions and other agreements contemplated by this Agreement, (iii) the fees and expenses payable by Seller or any of their Affiliates to outside accountants or other advisors incurred in connection with this Agreement and the transactions and other agreements contemplated by this Agreement, (iv) all Transfer Taxes for which Seller Parties are responsible pursuant to <u>Section 5.10</u>, and (v) any and all change of control, retention or sale bonuses, or other similar transaction-related payments payable as a result of the transactions contemplated hereby, including the employer portion of any employment Taxes applicable thereto (each such payment set forth in this subsection (v), a "<u>Change of</u> 

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<u>Control Payment</u>"). Notwithstanding the foregoing, such amounts shall be calculated without duplication of any amount included in the definition of Indebtedness.

"**<u>Software</u>**" means computer software, programs, and databases in any form, including source code, object code, operating systems and specifications, databases, database management code, software engines, software platforms,, all versions, updates, corrections, enhancements, and modifications thereto, and all related documentation, developer notes, comments, and annotations.

"**<u>Straddle Period</u>**" means any taxable period that begins prior to (but does not end on) the Closing Date.

"**<u>Tax</u>**" or "**<u>Taxes</u>**" means (i) any federal, state, local or non-U.S. income, excise, environmental, capital stock, profits, social security (or similar), disability, unclaimed property or escheatment, registration, value added, estimated, gross receipts, sales, use, ad valorem, transfer, franchise, license, withholding, payroll, employment, unemployment, excise, severance, stamp, occupation, premium, property or windfall profits taxes, alternative or add-on minimum taxes, customs duties estimated and other similar taxes, charges, fees, duties or other assessments of any kind in the nature of a tax, together with all interest and penalties imposed thereon by any Governmental Authority, and (ii) any obligation imposed by any Contract or Law (including, without limitation, as a result of being a member of an affiliated, combined, consolidated, unitary or other group for Tax purposes or pursuant to Treasury Regulations Section 1.1502-6 or any similar state, local or foreign Law) to indemnify, assume, succeed to or otherwise pay the liability of any other Person in respect of an amount described in clause (i) of this definition.

"**<u>Tax Returns</u>**" means any return, declaration, report, claim for refund, information return or statement relating to any Taxes, including any schedule or attachment thereto and including any amendment thereof, filed or supplied, or required or permitted to be filed or supplied, in connection with the imposition, determination, reporting, assessment or collection of any Tax or the administration, implementation or enforcement of or compliance with any Laws relating to any Tax, and whether in physical or electronic form.

"**<u>Transaction Documents</u>**" means this Agreement, the Bill of Sale and Assignment, the Employment Agreements, the Escrow Agreement, and such other instruments, certificates and agreements required by this Agreement to be executed and delivered hereunder.

"**<u>Treasury Regulations</u>**" means the regulations promulgated under the Code by the United States Department of the Treasury.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.2 <u>Table of Defined Terms</u>. Terms that are not defined in <u>Section 1.1</u> have the meanings set forth in the following Sections:<br>

LEGAL02/47580940v3

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Acquired Assets 2.1(a)

Agreement Preamble

Arbitrating Accountant 2.8(b)

Assigned Contracts 2.1(a)(iv)

Assumed Liabilities 2.2(a)

Balance Sheet Date 3.10(a)

Bill of Sale and Assignment 2.6(a)

Cap 6.4(b)

Closing 2.3

Closing Date 2.3

Deductible 6.4(b)

Delivered Financial Statements 3.10(a)

Effective Time 2.3

Employee Plans 3.13

Employment Agreements 2.6(a)

ERISA 3.13

ERISA Affiliate 3.13

Excluded Assets 2.1(b)

Excluded Liabilities 2.2(b)

Financial Statements 3.10(a)

General Escrow Release Date 6.7(a)

Indemnified Person 6.6(a)

Indemnifying Person 6.6(a)

Information Security Reviews 3.17(h)

Insurance Policies 3.19

IP Licenses 3.17(b)

Material Contracts 3.8(a)

Material Customers 3.18(a)

Material Suppliers 3.18(b)

Names 5.7(a)

Parties Preamble

Patents 1.1

PCI DSS 3.17(g)

Post-Reference Time Employee-Related Expenses 2.5(a)

Post-Reference Time Statement 2.5(a)

Post-Reference Time Trade Accounts Payable 2.5(a)

Privacy Agreements 3.17(g)

Privacy Consents 3.17(g)

Privacy Policies 3.17(g)

Privacy Requirements 3.17(g)

Prior Financial Statements 3.10(a)

Purchaser Preamble

Purchaser Indemnified Persons 6.2(a)

Real Property 3.15(a)

Real Property Leases 3.15(a)

Reference Balance Sheet 3.10(a)

Registered Intellectual Property 3.17(a)

Released Parties 5.14

Releasing Parties 5.14

Seller Preamble

Seller Parties Preamble

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Seller Indemnified Persons 6.3

Seller Related Person 3.21

Seller Relations 5.5(d)

Tax Allocation Schedule 2.8

Tax Allocation Schedule Methodology 2.8

Third-Party Claim 6.6(a)

Transfer Taxes 5.11

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# Article II. <br>PURCHASE AND SALE
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.1 <u>Purchase and Sale of Assets</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;(a) <u>Acquired Assets</u>. Subject to the terms and conditions set forth herein, at the Closing, Seller shall sell, transfer, assign, convey and deliver to Purchaser, and Purchaser shall purchase, acquire and accept from Seller, free and clear of any and all Liens, all of Seller's right, title and interest in, to and under all of the assets, properties and rights of every kind and nature, whether real, personal or mixed, tangible or intangible (including goodwill), wherever located and whether now existing or hereafter acquired (other than the Excluded Assets), which relate to, or are used or held for use in connection with, the Business (collectively, the "<u>Acquired Assets</u>"), including, without limitation, the following:

&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;&nbsp;&nbsp;&nbsp;&nbsp;(i) all accounts or notes receivable held by Seller that are not current assets, and any security, claim, remedy or other right related to any of the foregoing;

&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;&nbsp;&nbsp;&nbsp;&nbsp;(ii) all Contracts of Seller, including, without, limitation, the Material Contracts set forth on <u>Section 3.8(a)</u> of the Disclosure Schedule, the IP Licenses set forth on <u>Section 3.17(b)</u> of the Disclosure Schedule (but excluding any Contracts of Seller listed on <u>Schedule 2.1(a)(ii)</u>) (the "<u>Assigned Contracts</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;&nbsp;&nbsp;&nbsp;&nbsp;(iii) all Seller Intellectual Property;

&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;&nbsp;&nbsp;&nbsp;&nbsp;(iv) all furniture, fixtures, equipment, machinery, tools, vehicles, office equipment, supplies, computers, telephones and other tangible personal property of Seller;

&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;&nbsp;&nbsp;&nbsp;&nbsp;(v) all Permits that are held by Seller and required for the conduct of the Business as currently conducted or for the ownership and use of the Acquired Assets;

&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;&nbsp;&nbsp;&nbsp;&nbsp;(vi) all rights to any Claims of any nature available to or being pursued by Seller to the extent related to the Business, the Acquired Assets or the Assumed Liabilities, whether arising by way of counterclaim or otherwise;

&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;&nbsp;&nbsp;&nbsp;&nbsp;(vii) all prepaid expenses, credits, advance payments, claims, security, refunds, rights of recovery, rights of set-off, rights of recoupment, deposits, charges, sums and fees (excluding any such item relating to the payment of Taxes by Seller);

&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;&nbsp;&nbsp;&nbsp;&nbsp;(viii) all of Seller's rights under warranties, indemnities and all similar rights against third parties to the extent related to any Acquired Assets;

&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;&nbsp;&nbsp;&nbsp;&nbsp;(ix) all insurance benefits, including rights and proceeds, arising from or relating to the Business, the Acquired Assets or the Assumed Liabilities;

&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;&nbsp;&nbsp;&nbsp;&nbsp;(x) all Business Records; 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;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xi) all goodwill and the going concern value of the 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;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Excluded Assets</u>. Notwithstanding the foregoing, the Acquired Assets shall not include and Purchaser will not acquire any interest in or to, or any right, title or interest in, the following assets (collectively, the "<u>Excluded Assets</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;&nbsp;&nbsp;&nbsp;&nbsp;(i) all cash and cash equivalents of Seller;

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&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;&nbsp;&nbsp;&nbsp;&nbsp;(ii) all accounts or notes receivable held by Seller that are current assets, and any security, claim, remedy or other right related to any of the foregoing;

&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;&nbsp;&nbsp;&nbsp;&nbsp;(iii) all rights of Seller under the Assumed Contracts for the period prior to the closing date as it relates to the collection accounts or notes receivables held by Seller;

&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;&nbsp;&nbsp;&nbsp;&nbsp;(iv) all bank accounts of Seller;

&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;&nbsp;&nbsp;&nbsp;&nbsp;(v) the corporate seals, organizational documents, minute books, Tax Returns, books of account, including copies of financial records, or other records having to do with the corporate organization of Seller;

&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;&nbsp;&nbsp;&nbsp;&nbsp;(vi) any Employee Plans, including copies of human resources files, and all rights in connection therewith and/or any assets attributable 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;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vii) any Insurance Policies;

&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;&nbsp;&nbsp;&nbsp;&nbsp;(viii) any Claim, demand, right or privilege against one or more third parties that relates to any of the Excluded Assets or Excluded Liabilities, including causes of actions, claims and rights under insurance policies 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;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ix) all rights with respect to refunds, credits or similar benefits of Seller or any Affiliate thereof with respect to Taxes;

&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;&nbsp;&nbsp;&nbsp;&nbsp;(x) those items set forth on <u>Annex A</u>; 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;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xi) the rights which accrue or will accrue to Seller under the Transaction Documents.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2 <u>Assumption of Liabilities</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;(a) <u>Assumed Liabilities</u>. Subject to the terms and conditions set forth herein, Purchaser shall assume and agree to pay, perform and discharge only the following liabilities of Seller (collectively, the "<u>Assumed Liabilities</u>"), and no other liabilities: (i) all trade account payables associated with the Acquired Assets but only to the extent that such liabilities thereunder are required to be performed after the Closing Date, and do not relate to any failure to perform, improper performance, warranty or other breach, default or violation by Seller on or prior to the Closing (and without duplication of any amounts payable pursuant to <u>Section 2.5</u>), and (ii) all liabilities in respect of the Assigned Contracts but only to the extent that such liabilities thereunder are required to be performed after the Closing Date, and do not relate to any failure to perform, improper performance, warranty or other breach, default or violation by Seller on or prior to the Closing.

&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;(b) <u>Excluded Liabilities</u>. Notwithstanding the provisions of <u>Section 2.2(a)</u> or any other provision in this Agreement to the contrary, and regardless of whether such liability is disclosed herein or on any schedule or exhibit hereto (except solely to the extent of the Assumed Liabilities), at the Closing, Purchaser shall not assume and shall not be responsible to pay, perform or discharge: (i) any liabilities arising from all trade accounts payable of Seller (other than those associated with the Acquired Assets for the period after the Closing Date); (ii) any Seller Transaction Expenses, including the retention and sale bonuses payable to employees of Seller as a result of the transactions contemplated hereby in the amounts set forth on <u>Schedule 2.2(b)(ii)</u>, including the employer portion of any employment Taxes applicable thereto, (iii) Indebtedness of Seller, and (iv) any liabilities of Seller or any of their Affiliates of any kind or nature whatsoever (in any case, whether known or unknown, asserted or unasserted, absolute or contingent,

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accrued or unaccrued, liquidated or unliquidated, due or to become due or otherwise) other than the Assumed Liabilities (collectively, the "<u>Excluded Liabilities</u>"). Seller shall, and shall cause its Affiliates to, pay and satisfy in due course all Excluded Liabilities.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.3 <u>Closing</u>. Subject to the terms and conditions of this Agreement, the closing of the transactions contemplated hereby (the "<u>Closing</u>") shall take place simultaneously with the execution and delivery hereof on the Closing Date. The date upon which the Closing occurs is referred to herein as the "<u>Closing Date</u>." The Closing will be deemed to occur at 12:00:01 a.m. (Eastern Time) on the Closing Date (the "<u>Effective Time</u>").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.4 <u>Closing Payments; Actions and Deliveries</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;(a) <u>Closing Payments</u>. At the Closing, as consideration for Seller's sale of the Acquired Assets to Purchaser, Purchaser shall pay or cause to be paid by wire transfer of immediately available funds to Seller an amount equal to (i) the Base Purchase Price, *<u>minus</u>* (ii) the Escrow Amount, *<u>minus</u>* (iii) Seller's one-half of the fees due to Escrow Agent (i.e., $1,500), *<u>plus</u>* (iv) the Regus Deposit Reimbursement Amount (such net amount being the "<u>Closing Cash Amount</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;(b) <u>Flow of Funds</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;&nbsp;&nbsp;&nbsp;&nbsp;(i) <u>Payment of Closing Cash Amount</u>. At the Closing, Purchaser will pay by wire transfer of immediately available funds to Seller, pursuant to and in accordance with the payment instructions provided by Seller at least three (3) Business Days prior to the Closing, cash in an aggregate amount equal to the Closing Cash 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;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) <u>Payment of Escrow Amount</u>. At the Closing, Purchaser will pay by wire transfer of immediately available funds to Escrow Agent, pursuant to and in accordance with the payment instructions provided by Escrow Agent at least three (3) Business Days prior to the Closing, cash in an aggregate amount equal to the Escrow 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;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Other Closing Actions and Deliveries</u>. Subject to <u>Section 2.6(a)</u> and <u>Section 2.6(b)</u> respectively, at or prior to the Closing, Seller and Purchaser shall have delivered the items required to be delivered thereby pursuant to this <u>ARTICLE II</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.5 <u>Post-Reference Time Payment</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;(a) Promptly following the Closing, but no later than March 31, 2026, Seller shall deliver to Purchaser a statement (such statement, the "<u>Post-Reference Time Statement</u>") setting forth in detail Seller's good faith calculation of the amounts of (i) the trade accounts payable of Seller that arose during the Post-Reference Time Period in Seller's Ordinary Course of Business and were recognized as current liabilities of Seller during the Post-Reference Time Period (the "<u>Post-Reference Time Trade Accounts Payable</u>") and (ii) the out of pocket amounts paid by Seller during the month ended January 31, 2026 in respect of Seller's compensation and benefit obligations to employees of Seller in Seller's Ordinary Course of Business, prorated between the Post-Reference Time Period and the balance during the month ended January 31, 2026 (the "<u>Post-Reference Time Employee-Related Expenses</u>"). For clarity, any amounts paid to such employees in connection with or as a result of the transactions contemplated by this Agreement (including any transaction bonuses, payments in respect of stock options or equity incentives, and dividends or distributions) shall be deemed not to be Post-Reference Time Employee-Related Expenses.

&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;(b) With delivery of the Post-Reference Time Statement, Seller shall provide Purchaser with all documentation reasonably necessary for Purchaser to review and confirm the accuracy of the Post-Reference Time Statement. Subject to the resolution of any good faith disputes regarding the

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Post-Reference Time Statement, within thirty (30) days after Seller delivers to Purchaser all statements and information required by this <u>Section 2.5</u>, Purchaser shall pay to Seller an aggregate amount equal to the sum of the Post-Reference Time Trade Accounts Payable plus the Post-Reference Time Employee-Related Expenses, in cash, by wire transfer of immediately available funds to the account designated by Seller.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.6 <u>Closing Deliverables</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;(a) <u>Seller Closing Deliverables</u>. In addition to any other documents to be delivered under other provisions of this Agreement, at the Closing, Seller shall deliver, or cause to be delivered to Purchaser:

&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;&nbsp;&nbsp;&nbsp;&nbsp;(i) <u>t</u>he Bill of Sale and Assignment and Assumption Agreement in the form attached hereto as <u>Exhibit A</u> (the "<u>Bill of Sale and Assignment</u>"), executed by Seller;

&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;&nbsp;&nbsp;&nbsp;&nbsp;(ii) any deeds, bills of sale, assignments, certificates of title, documents, and other instruments of transfer and conveyance required to vest Purchaser with full, complete, and marketable right, title, and interest in and to the Acquired Assets, free and clear of any and all Liens, each in form and substance satisfactory to Purchaser, executed by Seller;

&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;&nbsp;&nbsp;&nbsp;&nbsp;(iii) a certificate of the Secretary of Seller certifying, as complete and accurate as of the Closing, copies of the Governing Documents of Seller, including Seller's Certificate of Incorporation (certified by the Secretary of State of the State of Delaware), and certifying and attaching resolutions of Seller's board of directors unanimously approving the execution and delivery of this Agreement, the Transaction Documents which Seller is a party to, and the consummation of the transactions contemplated hereby;

&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;&nbsp;&nbsp;&nbsp;&nbsp;(iv) a certificate of good standing of Seller from the Secretary of State of the State of Delaware;

&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;&nbsp;&nbsp;&nbsp;&nbsp;(v) reserved;

&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;&nbsp;&nbsp;&nbsp;&nbsp;(vi) subject to <u>Section 5.6</u>, all required consents, waivers, notices and estoppels of third parties set forth on <u>Schedule 2.7(a)(vi)</u>, each executed by the counterparties thereto and in a form satisfactory to Purchaser;

&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;&nbsp;&nbsp;&nbsp;&nbsp;(vii) the employment agreements, in form and substance satisfactory to Purchaser, duly executed by each of Bruce Hounsell and William Looney (collectively, the "<u>Employment Agreements</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;&nbsp;&nbsp;&nbsp;&nbsp;(viii) the Escrow Agreement, executed by Seller;

&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;&nbsp;&nbsp;&nbsp;&nbsp;(ix) evidence reasonably satisfactory to Purchaser of the release of all Liens on the Acquired Assets;

&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;&nbsp;&nbsp;&nbsp;&nbsp;(x) validly completed IRS Form W-9 of Seller;

&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;&nbsp;&nbsp;&nbsp;&nbsp;(xi) all passwords and login information necessary for full use, control and operation of the Seller Intellectual Property and Seller technology and any other information necessary to access Seller's systems and software or customer technology, systems or software;

&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;&nbsp;&nbsp;&nbsp;&nbsp;(xii) evidence, in form and substance reasonably satisfactory to Buyer, of the transfer of control and ownership of the Domain Names to Buyer or Buyer's designee; and

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&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;&nbsp;&nbsp;&nbsp;&nbsp;(xiii) such other instruments, documents and certificates as are required by the terms of this Agreement and the other Transaction Documents, or as may be reasonably requested by Purchaser in connection with the transactions contemplated by 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;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Purchaser Closing Deliverables</u>. In addition to any other documents to be delivered under other provisions of this Agreement, at the Closing, Purchaser shall deliver, or cause to be delivered to Seller:

&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;&nbsp;&nbsp;&nbsp;&nbsp;(i) an aggregate amount in cash equal to the Closing Cash Amount, by wire transfer of immediately available funds to account(s) designated in writing by Seller;

&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;&nbsp;&nbsp;&nbsp;&nbsp;(ii) an aggregate amount in cash equal to the Escrow Amount, by wire transfer of immediately available funds to account(s) designated in writing by Escrow Agent;

&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;&nbsp;&nbsp;&nbsp;&nbsp;(iii) the Bill of Sale and Assignment, executed by Purchaser;

&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;&nbsp;&nbsp;&nbsp;&nbsp;(iv) a certificate of the Secretary of Purchaser certifying, as complete and accurate as of the Closing, copies of the Governing Documents of Purchaser, including Purchaser's Certificate of Formation (certified by the Secretary of State of the State of Delaware), and certifying and attaching resolutions of the board of directors of Purchaser approving the execution and delivery of this Agreement, the Transaction Documents and the consummation of the transactions contemplated hereby; 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;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) a certificate of good standing of Purchaser from the Secretary of State of the State of Delaware;

&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;&nbsp;&nbsp;&nbsp;&nbsp;(vi) the Employment Agreements, each executed by Purchaser;

&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;&nbsp;&nbsp;&nbsp;&nbsp;(vii) the Escrow Agreement, executed by Purchaser and the Escrow Agent; 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;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(viii) <u>s</u>uch other instruments, documents and certificates as are required by the terms of this Agreement and the other Transaction Documents, or as may be reasonably requested by the Seller in connection with the transactions contemplated by this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.7 <u>Withholding</u>. Purchaser shall be entitled to deduct and withhold from the consideration otherwise payable to any Person pursuant to this Agreement all Taxes that Purchaser is required to deduct and withhold under any provision of Tax Law. All such withheld amounts shall be treated for all purposes of this Agreement as having been paid to the Person in respect of which the deduction or withholding was made. Purchaser shall use commercially reasonable efforts to (i) promptly provide Seller with written notice of any amounts that Purchaser intends to withhold from any payment required to be made pursuant to this Agreement reasonably in advance of such payment; provided that notice shall not be required to be given if such payment is a compensatory payment, (ii) cooperate in good faith with Seller to determine whether an exemption from or reduced rate of withholding or deduction is applicable and, if so, seek to eliminate or reduce any such withholding or deduction, and (iii) provide Seller a reasonable opportunity to provide any applicable certificates, forms or other documentation that would eliminate or reduce the requirement to deduct or withhold under applicable Law.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.8 <u>Allocation of Consideration</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;(a) The Parties agree to allocate the Base Purchase Price (including any assumed liabilities and any other amounts treated as taxable consideration for Income Tax purposes) among the Acquired Assets and Assumed Liabilities in accordance with <u>Annex B</u> (the "<u>Tax Allocation Schedule Methodology</u>"), which is consistent with Section 1060 of the Code and the Treasury Regulations

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promulgated thereunder. Within sixty (60) days following the Closing Date, Purchaser will prepare and deliver to Seller a draft allocation in respect of each of the Acquired Assets and Assumed Liabilities, with such allocation to be in accordance with the Tax Allocation Schedule Methodology (the "<u>Tax Allocation Schedule</u>"). Purchaser and Seller agree to use commercially reasonable efforts to resolve in good faith any differences with respect to the Tax Allocation Schedule. If they are unable to do so, the provision of <u>Section 2.8(b)</u> below shall apply. If Seller does not object to the Tax Allocation Schedule or the Tax Allocation Schedule otherwise becomes final, Purchaser and Seller agree to (a) prepare and file each of their respective Tax Returns on a basis consistent with such Tax Allocation Schedule (or such Tax Allocation Schedule agreed to by Purchaser and Seller) and (b) unless otherwise required by Law, take no position inconsistent with such Tax Allocation Schedule (or such Tax Allocation Schedule as agreed to by Purchaser and Seller) on any applicable Tax Return or in any related Proceeding before any Governmental Authority.

&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;(b) Within thirty (30) days after delivery of the Tax Allocation Schedule by Purchaser, Seller may deliver written notice to Purchaser of any objections that Seller may have to the Tax Allocation Schedule. Upon receipt of such notice, Purchaser and Seller shall attempt in good faith to resolve any dispute regarding the Tax Allocation Schedule. If Purchaser and Seller are unable to resolve any disagreement with respect to the Tax Allocation Schedule within thirty (30) days following Purchaser's receipt of the Seller's written notice of objections, then such dispute shall be submitted to an independent nationally recognized accounting or financial consulting firm that is mutually agreed upon by Purchaser and Seller, each acting in good faith (such firm, or any successor thereto, being referred to herein as the "<u>Arbitrating Accountant</u>"). The Arbitrating Accountant will be instructed to send to Purchaser and Seller, within thirty (30) days of the date on which such dispute is referred to such Arbitrating Accountant, its determination on the specific matters in dispute which shall be final and binding on all Parties, absent fraud or manifest error, and shall be considered an arbitral award for all purposes, and upon which a judgment may be entered by a court having competent jurisdiction. The Arbitrating Accountant shall make such determination based solely on the data presented by Purchaser and Seller that are in accordance with the terms of this <u>Article II</u> (i.e., not by independent review). The Arbitrating Accountant shall be the sole arbiter of all matters, procedural or substantive, as to such matters in dispute. Each of Purchaser and Seller shall execute the Arbitrating Accountant's standard engagement letter and fund one-half (1/2) of its standard retainer, if applicable; <u>provided</u>, that the total fees and costs of the Arbitrating Accountant for such determination shall be paid by the Party whose calculation of the Tax Allocation Schedule is farther from the final calculation of the Tax Allocation Schedule after taking into account the determinations of the Arbitrating Accountant. For the avoidance of doubt, the Arbitrating Accountant shall not make any determination for any amount other than such amount or amounts in dispute and raised in Seller's written notice of objections to the Tax Allocation Schedule. The Tax Allocation Schedule shall incorporate the determination of the Arbitrating Accountant as well as those amounts not so in dispute, and shall be final and binding on the Parties.

# Article III. <br>REPRESENTATIONS AND WARRANTIES OF SELLER
Except as specifically set forth in the Disclosure Schedule delivered by Seller to Purchaser in connection with the execution of this Agreement, Seller hereby represents and warrants to Purchaser that the following statements are true and correct as of the date of this Agreement (or, if made as of a specified date, as of such date):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.1 <u>Organization and Qualification</u>. Seller is a corporation duly incorporated, validly existing and in good standing under the Laws of the State of Delaware, and (a) has all the requisite corporate power and authority to own, lease and operate its properties and to carry on its business as it is now being conducted and (b) except where the failure to be duly qualified would not have a Material Adverse Effect, is duly qualified to do business and is in good standing in each of the jurisdictions in which the ownership,

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## operation or leasing of its properties and assets and the conduct of its business requires it to be so qualified, each of which is set forth in <u>Section 3.1 of the Disclosure Schedule</u>.
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.2 <u>Governing Documents</u>. Seller has made available to Purchaser true and complete copies of all of the Governing Documents of Seller, as presently in effect. Seller is not in material violation of any such Governing Document.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.3 <u>Capitalization</u>. The shareholders set forth on <u>Section 3.3 of the Disclosure Schedule</u> own all of the authorized, issued and outstanding Equity Interests of Seller, free and clear of all Liens, in the amounts set forth on <u>Section 3.3 of the Disclosure Schedule</u>. No other Person owns, holds or has any right to acquire any Equity Interest in Seller.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.4 <u>Subsidiaries</u>. Seller does not own, directly or indirectly, any Equity Interests in any other Person. Seller is not obligated to make any investment in or capital contribution to any Person.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.5 <u>Authority; Enforceability</u>. Seller has the requisite power and authority to execute and deliver this Agreement, each other Transaction Document to which it is a party and each instrument required to be executed and delivered by it hereunder, to perform its obligations hereunder and thereunder and to consummate the transactions contemplated hereby and thereby. The execution and delivery by Seller of this Agreement, each other Transaction Document to which it is a party and each instrument required to be executed and delivered by it hereunder, the performance of its obligations hereunder and thereunder and the consummation of the transactions contemplated hereby and thereby have been duly and validly approved and authorized by all necessary corporate, limited liability company or similar action, and no other corporate, limited liability company or similar action on the part of Seller is necessary to authorize this Agreement, any other Transaction Document to which it is a party or any instrument required to be executed and delivered by it hereunder or the consummation of transactions contemplated hereby or thereby. This Agreement has been duly and validly executed and delivered by Seller and, assuming the due authorization, execution and delivery thereof by Purchaser, constitutes a legal, valid and binding obligation of Seller, enforceable against Seller in accordance with its terms, subject to the effects of bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and other similar Laws relating to or affecting creditors' rights generally and general equitable principles (whether considered in a proceeding in equity or at law).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.6 <u>Indebtedness; Seller Transaction Expenses</u>. Except as set forth on <u>Section 3.6(a) of the Disclosure Schedule</u>, Seller has (a) no Indebtedness, (b) no liability or obligation with respect to any Change of Control Payment and (c) no outstanding Seller Transaction Expenses.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.7 <u>No Conflict; Required Filings and Consents</u>. The execution and delivery by Seller of this Agreement, the other Transaction Documents to which it is a party or any instrument required by this Agreement to be executed and delivered by Seller hereunder do not, and the performance of this Agreement, the other Transaction Documents to which it is a party and any instrument required by this Agreement to be executed and delivered by it hereunder will not, (a) conflict with, require a consent or notice under or violate any Governing Document of Seller, (b) except as otherwise provided by <u>Section 3.7 of the Disclosure Schedule</u>, conflict with, require a consent or notice under or violate any Law or Order applicable to Seller or by which any properties, rights or assets of Seller is bound or affected, or (c) except as otherwise provided by <u>Section 3.7 of the Disclosure Schedule</u>, to the Knowledge of Seller, result in any breach or violation of, require a consent or notice under, or constitute a default under, or impair Seller's rights or alter the rights or obligations of any party under, or give to others any rights of termination, amendment, acceleration or cancellation of, or result in the creation of a Lien on any of the properties, rights or assets of Seller pursuant to, any Material Contract. No Governmental Approval of, or filing to, any Governmental

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## Authority is required to be obtained or made by or with respect to Seller in connection with the consummation of the transactions contemplated hereby.
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.8 <u>Material Contracts</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;(a) <u>Section 3.8(a) of the Disclosure Schedule</u> sets forth a true and complete list as of the date of this Agreement of all current Material Contracts to which Seller is a party or is otherwise bound. As used herein, "<u>Material Contracts</u>" means all of the following (but specifically excludes fulfilled purchase orders containing no material ongoing obligations and arising in the Ordinary Course of Business and contracts which have expired by their terms):

&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;&nbsp;&nbsp;&nbsp;&nbsp;(i) each Contract providing for payments by or to Seller of at least $50,000 in the aggregate;

&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;&nbsp;&nbsp;&nbsp;&nbsp;(ii) each Contract with each Material Customer or Material Supplier;

&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;&nbsp;&nbsp;&nbsp;&nbsp;(iii) each Contract that is an employment or individual independent contractor agreement with any current or former manager, director, officer, employee or individual independent contractor of Seller;

&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;&nbsp;&nbsp;&nbsp;&nbsp;(iv) each Contract providing for or related to the sale of any assets of or Equity Interests in Seller or the acquisition of any Equity Interests by Seller or any other business combination transaction involving Seller, whether a recapitalization, reorganization, consolidation, merger or otherwise;

&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;&nbsp;&nbsp;&nbsp;&nbsp;(v) each Contract evidencing or providing for Indebtedness of greater than $50,000 or otherwise placing a Lien on the assets of Seller or evidencing or providing for Seller's guarantee of the liabilities of any other Person;

&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;&nbsp;&nbsp;&nbsp;&nbsp;(vi) each Real Property Lease, IP License (other than (i) non-exclusive rights granted by Seller in the Ordinary Course of Business or (ii) commercially available, off-the-shelf Software license agreements subject to one-time or annual fees of less than $100,000 for all license, support and maintenance fees for such Software), and other Contract that is a lease agreement, license, or installment or conditional sale Contract related to or otherwise affecting any real or personal property of or used by Seller involving annual payments in excess of $50,000;

&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;&nbsp;&nbsp;&nbsp;&nbsp;(vii) each Contract that (i) requires Seller to deal exclusively with the counterparty, (ii) restricts the ability of Seller to engage in any line of business, compete with any Person, (iii) except as may be contained in a confidentiality or non-disclosure agreement, restricts the ability of Seller to solicit any customers, suppliers, employees or contractors of any other Person, (iv) restricts the ability of Seller sell or purchase any product, or (v) prohibits Seller from competing in any product or geographic market;

&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;&nbsp;&nbsp;&nbsp;&nbsp;(viii) each Contract that contains any capped pricing or "most favored nation" pricing;

&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;&nbsp;&nbsp;&nbsp;&nbsp;(ix) each Contract that is a joint venture agreement, partnership agreement or a similar agreement involving the sharing of profits with any other Person;

&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;&nbsp;&nbsp;&nbsp;&nbsp;(x) each Contract that governs or relates to the voting or transfer of Equity Interests in Seller or that provides specific requirements for the approval of any material transactions involving Seller;

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&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;&nbsp;&nbsp;&nbsp;&nbsp;(xi) other than those Contracts set forth on <u>Section 3.8(a)(iii) of the Disclosure Schedule</u>, each Contract with any Seller Related Person which involves a payment of over $50,000 per year;

&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;&nbsp;&nbsp;&nbsp;&nbsp;(xii) each Contract involving any resolution or settlement of any actual or threatened litigation, arbitration, claim or other dispute that has any continuing effect on Seller;

&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;&nbsp;&nbsp;&nbsp;&nbsp;(xiii) each Contract that is a collective bargaining agreement or other Contract with any labor union; 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;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xiv) each Contract with a Governmental Authority or that is otherwise premised on any preferential or disadvantaged status (including "small business" status, "minority owned" status, "veteran owned" status, or "women owned" status).

&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;(b) True and complete copies of all Material Contracts, including all amendments and modifications thereof, have been made available to Purchaser by Seller. Each Material Contract is in full force and effect, is a valid and binding obligation of Seller and, to the Knowledge of Seller, of each other party thereto and is enforceable in accordance with its terms against Seller and, to the Knowledge of Seller, against each other party to such Contract, subject in each case to the effects of bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and other similar Laws relating to or affecting creditors' rights generally and general equitable principles (whether considered in a proceeding in equity or at 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;&nbsp;&nbsp;&nbsp;&nbsp;(c) To the Knowledge of Seller, neither Seller, nor any other party to any Material Contract, is or since January 1, 2023, has been, in material breach or default under any Material Contract, and to the Knowledge of Seller, no event has occurred that, with or without notice or lapse of time, would constitute a material breach or default under any Material Contract. Since January 1, 2023, Seller has not given to, or received from, any other party to any Material Contract, any notice or communication (whether written or oral) regarding any actual or alleged material breach of or default under any Material Contract by Seller or any other party to such Material Contract.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.9 <u>Compliance with Laws</u>. Seller is, and at all times since January 1, 2023, has been, in compliance in all material respects with all applicable Laws and all Orders of any Governmental Authority applicable to such Seller or the ownership, lease, use, occupancy, or operation of the Acquired Assets or the conduct of the Business. Since January 1, 2023, Seller has not received any written, or, to the Knowledge of Seller, oral, notice, report, order, demand, request for information, citation, summons, complaint, notice of breach or directive or other communication from any Governmental Authority of any breach of any Law which is material to Seller taken as a whole. There is no, and since January 1, 2023, has not been any, investigation by a Governmental Authority pending against or, to the Knowledge of Seller, threatened against Seller related to the ownership, lease, use, occupancy, or operation of the Acquired Assets or the conduct of the Business.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.10 <u>Financial Statements</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;(a) <u>Section 3.10(a)(i) of the Disclosure Schedule</u> contains true and complete copies of the (i) unaudited balance sheet of Seller as of December 31, 2024, December 31, 2023 and the related statements of income and cash flows for the years then ended (the "<u>Prior Financial Statements</u>"), and (ii) the unaudited balance sheet of Seller as of December 31, 2025 and the related statements of income and cash flows for the period then ended (the "<u>Delivered Financial Statements</u>" and, collectively with the Prior Financial Statements, the "<u>Financial Statements</u>"). The balance sheet of Seller as of December 31, 2024 is referred to herein as the "<u>Reference Balance Sheet</u>" and December 31, 2024 is referred to herein as the "<u>Balance Sheet Date</u>." The Financial Statements were prepared on the basis of the books and records of

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Seller kept in the Ordinary Course of Business and, except as specified in <u>Section 3.10(a)(ii)</u> of the Disclosure Schedule, in material accordance with GAAP applied on a consistent basis throughout the periods indicated and fairly present in all materials respects the financial position and results of operations and cash flows of Seller as of the respective dates thereof and for the periods indicated.

&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;(b) Seller has no liabilities or obligations of any nature (whether absolute, accrued, contingent or otherwise), except for (i) liabilities or obligations reflected or reserved against on the face of the Reference Balance Sheet, and (ii) current liabilities incurred in the Ordinary Course of Business since the date of the Reference Balance Sheet (none of which relates to a breach of Contract, breach of warranty, tort, infringement or violation of Law).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.11 <u>Absence of Certain Changes and Events</u>. Since the Balance Sheet Date, and other than in the Ordinary Course of Business, there has not been any change, event, condition, or development that is, individually or in the aggregate, materially adverse to: (a) the Business, results of operations, condition (financial or otherwise), or assets of the Business; or (b) the value of the Acquired Assets.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.12 <u>Absence of Litigation, Claims and Orders</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;(a) Except as set forth on <u>Section 3.12(a) of the Disclosure Schedule,</u> there are no Proceedings pending (i) by or against Seller any of the assets owned by Seller, or (ii) by or against Seller that challenge, or that may have the effect of preventing, delaying, making illegal or otherwise interfering with, the transactions contemplated hereby. To the Knowledge of Seller, no such Proceeding has been threatened, and no event has occurred or circumstance exists that may give rise to or serve as a basis for the commencement of any such Proceeding. Since January 1, 2023, there have not been any Orders rendered against, or any settlements effected by, Seller in connection with any Proceedings brought by or against Seller.

&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;(b) There are no Orders outstanding: (i) against Seller or any of the assets owned by Seller; or (ii) against Seller that challenge, or that may have the effect of preventing, delaying, making illegal or otherwise interfering with, the transactions contemplated hereby. To the Knowledge of Seller, no such Order has been threatened, and no event has occurred or circumstance exists that may give rise to or serve as a basis for the commencement of any such Order.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.13 <u>Employee Benefit Plans</u>. <u>Section 3.13 of the Disclosure Schedule</u> sets forth a complete list of all "employee benefit plans" (as that term is defined in Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended ("<u>ERISA</u>")) as well as any bonus, stock option, equity compensation, deferred compensation plan, stock purchase, medical, compensation, welfare, disability, severance or termination pay, insurance or incentive plan and each other benefit plan, program, agreement or arrangement, (whether funded or unfunded, written or oral, qualified or nonqualified), sponsored, maintained or contributed to or required to be contributed to by Seller or its ERISA Affiliates, for the benefit of any employee, leased employee, director, officer, manager, owner or independent contractor (in each case either current or former) of Seller or its ERISA Affiliates, and/or their dependents or beneficiaries or with respect to which Seller or its ERISA Affiliates otherwise has any liabilities or obligations (the "<u>Employee Plans</u>"). Neither Seller, nor its ERISA Affiliates, have any liability, contingent or otherwise, with respect to any plan, arrangement or practice of the type described in this <u>Section 3.13</u> other than the Employee Plans set forth on <u>Section 3.13 of the Disclosure Schedule</u>. <u>Section 3.13 of the Disclosure Schedule</u> sets forth all the Employee Plans with respect to which the payments, benefits or obligations are funded through a third party insurer or are self-insured. For purposes of this Agreement, "<u>ERISA Affiliate</u>" means any entity that is considered a single employer with Seller under Section 414 of the Code.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.14 <u>Labor Matters</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;(a) <u>Section 3.14(a) of the Disclosure Schedule</u> contains a list of all Persons who are employees, consultants or contractors of Seller as of the date of this Agreement (including all employees who are on an approved leave of absence).

&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;(b) Seller is not, and has never been, a party to, or bound by, any collective bargaining agreement, Contract or other agreement or understanding with a labor union or labor organization, and there are no labor organizations representing, purporting to represent or, to the Knowledge of Seller, attempting to represent any employee.

&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;(c) There are no pending or, to the Knowledge of Seller, threatened charges or complaints against Seller before any Governmental Authority regarding discrimination, harassment, retaliation, wrongful or constructive discharge, workplace safety, or any other employment-related matter, including, without limitation, claims for wage and hour violations, unemployment compensation, workers' compensation, leave interference, disability accommodations, or any other claims arising from or relating to the employment of any of the employees of Seller or the relationship of Seller with any independent contractor.

&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;(d) Except as set forth on <u>Section 3.14(d) of the Disclosure Schedule</u>, all employees of Seller are employed on an at-will basis and may terminate their employment or be terminated from employment at any time for any or no reason with or without prior notice.

&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) To the Knowledge of Seller, no employee of Seller has a present intention to terminate their employment with Seller.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.15 <u>Real 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;&nbsp;&nbsp;&nbsp;&nbsp;(a) Seller does not currently own any real property, nor has Seller agreed to and Seller does not hold any Contract, agreement, option or other rights to purchase or to acquire any real property, nor has Seller previously owned any real property. <u>Section 3.15(a) of the Disclosure Schedule</u> sets forth (i) a true, complete, and correct list of all real property leases, subleases, licenses, or occupancy agreements, including all amendments, modifications or supplements thereto (the "<u>Real Property Leases</u>"), to which Seller is a party, whether as a (sub)lessor, (sub)lessee, or otherwise, and (ii) the identity of the lessee, lessor, sublessee, sublessor, licensee, licensor or other party to each Real Property Lease, the date of each Real Property Lease, and the corresponding street address with respect to the real property (any such real property, the "<u>Real Property</u>") leased under each Real Property Lease. The Real Property Leases are legal, valid and binding obligations of Seller. Seller has not leased, subleased, assigned, transferred or otherwise granted to any Person the right to use or occupy the Real Property or any portion thereof. Seller does not owe any brokerage commissions or finder's fees with respect to any Real Property Lease, and Seller has not collaterally assigned or granted any other security interest in any Real Property Lease.

&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;(b) The Real Property and the use of the Real Property by Seller for the purposes for which the Real Property is currently being used complies in all material respects with (i) all applicable public and private restrictions, fire, safety, zoning, subdivision and building Laws and ordinances, Laws relating to the disabled, and other applicable Laws and (ii) all Permits, certificates of occupancy, covenants, conditions, restrictions or other contractual obligations applicable to the Real Property, including the requirements of any applicable Lien. To the Knowledge of Seller, there are no pending or threatened eminent domain, expropriation, condemnation, zoning or other Proceedings affecting the Real Property that would result in the taking of all or any part of the Real Property or that would prevent or hinder the continued use of the Real Property as currently used in the conduct of the Business.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.16 <u>Taxes</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;(a) Seller has timely filed (including applicable filing extensions) all Tax Returns required to have been filed by it with the appropriate Governmental Authority and all such Tax Returns are true, correct and complete in all material respects. No written claim has ever been made in the past five (5) years by a Governmental Authority in a jurisdiction where Seller does not file Tax Returns that Seller is or may be subject to taxation by that jurisdiction.

&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;(b) Seller has paid all Taxes due and payable to any Governmental Authority whether or not shown on any Tax Return. All Taxes that Seller is or was required by applicable Law to withhold or collect have been withheld or collected, and, to the extent required, have been properly remitted on a timely basis to the appropriate Governmental Authority.

&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;(c) No examination, audit, assessment or other Proceeding is currently in progress, is pending or has been threatened in writing by any Governmental Authority with respect to the Taxes or Tax Returns of Seller.

&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;(d) [Seller is not a party to any agreement, contract, arrangement or plan that has resulted or could result, separately or in the aggregate, in the payment of any "excess parachute payment" within the meaning of Section 280G of the Code (or any corresponding provision of state, local or foreign Tax law) (including any payment required to be made in connection with the transactions contemplated hereby).]

&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) There are no Liens for Taxes upon any assets of Seller, except Liens for Taxes not yet due and payable or that being contested pursuant to appropriate proceeding for which adequate reserves have been established in accordance with GAAP.

&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;(f) Seller (A) has not been a member of an affiliated group filing a consolidated federal Income Tax Return (other than any group of which Seller is the common parent) and (B) has no liability for the Taxes of any Person under Treasury Regulations Section 1.1502-6 (or any similar provision of state, local or foreign Law), as a transferee or successor, by Contract or otherwise (other than any Contract or arrangement the primary purpose of which does not relate to Taxes). Seller is not a party to or bound by, nor does it have any obligation under, any Tax sharing, Tax indemnification or Tax allocation agreement or similar Contract or arrangement (other than any Contract or arrangement the primary purpose of which does not relate to Taxes).

&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;(g) Seller has not distributed the stock of any corporation or had its stock or equity interests distributed by another Person in a transaction satisfying or intending to satisfy, in whole or in part, the requirements of Section 355 or Section 361 of the Code. The transactions contemplated by this Agreement, in conjunction with any prior distribution or transactions by the Company, do not constitute part of a "plan" or "series of related transactions" within the meaning of Section 355(e) of the Code.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.17 <u>Intellectual Property and Information Privacy and Security Laws</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;(a) <u>Section 3.17(a) of the Disclosure Schedule</u> sets forth an accurate and complete list of each of the following Seller-Owned Intellectual Property that is used by the Business as it is currently conducted: (i) all issued Patents and pending Patent applications; (ii) all Trademark registrations and pending Trademark applications; (iii) all Domain Name registrations; (iv) all Copyright registrations; (v) any other Seller-Owned Intellectual Property that is the subject of an application, certificate, or registration issued by any Governmental Authority (collectively, the "<u>Registered Intellectual Property</u>"), in each case, listing the name of the current owner and showing the jurisdiction in which each such Registered Intellectual Property has been issued or registered and the application, serial, or registration number; (vi) all material

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unregistered Trademarks; (vii) all material unregistered Copyrights; and (viii) all social media accounts. To the Knowledge of Seller, none of the Registered Intellectual Property is the subject of any Proceeding filed with any Governmental Authority anywhere in the world (excluding any ongoing office actions or similar ordinary course prosecution proceedings before an intellectual property registry or Governmental Authority not involving a third party) and, since January 1, 2023, has lapsed, expired or been abandoned or withdrawn. Seller has taken commercially reasonable measures to protect the Registered Intellectual Property. To the Knowledge of Seller, no Registered Intellectual Property has been held by a Governmental Authority to be invalid, unenforceable or non-subsisting. No payments or filings will become due, and no other actions must be taken, within sixty (60) days after the date of this Agreement with respect to each item of Registered Intellectual Property.

&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;(c) Each IP License is in full force and effect, and except as set forth on <u>Section 3.17(c) of the Disclosure Schedule</u>, entry into this Agreement and the consummation of the transactions contemplated hereby will not result in (i) any third party being granted rights or access to any Seller-Owned Intellectual Property, (ii) Purchaser or any of its Affiliates being obligated to pay any royalties or other amounts to any third party with respect to any IP Rights in excess of those payable by Seller prior to the Closing Date, or (iii) termination or impairment of any Seller Intellectual Property or any IP License. None of the Outbound IP Licenses grant any Person any exclusive rights to or under any Seller-Owned Intellectual Property or any right to sublicense any Seller-Owned Intellectual Property.

&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;(d) Seller has taken commercially reasonable actions to maintain the confidentiality, secrecy, and value of the Trade Secrets of Seller, and to the Knowledge of Seller no such Trade Secrets have been used by or disclosed to any Person, except pursuant to written and appropriate non-disclosure and/or license agreements pursuant to which such Persons agree to protect such Trade Secrets and which have not been breached by Seller or, to the Knowledge of Seller, any other party thereto. All current and former employees, independent contractors, and consultants of Seller who have had access to Trade Secrets of Seller have entered into confidentiality agreements with Seller.

&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) (i) The conduct of the Business as currently conducted by Seller does not interfere with, infringe, misappropriate or otherwise violate the IP Rights of any other Person. (ii) Except as set forth in <u>Section 3.17(e)(ii) of the Disclosure Schedule</u>, (A) the conduct and operations of the Business has not in the last three (3) years infringed, misappropriated, or otherwise violated, and do not infringe, misappropriate, or otherwise violate, the IP Rights of any other Person; and (B) to the Knowledge of Seller,

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no Person has in the last three (3) years infringed, misappropriated, or otherwise violated, or is infringing, misappropriating, or otherwise violating, any Seller-Owned Intellectual Property. Notwithstanding anything to the contrary in this Agreement, this <u>Section 3.17(e)</u> constitutes the sole representation and warranty of Seller under this Agreement with respect to any actual or alleged infringement, misappropriation or other violation by Seller of any Intellectual Property of any other Person.

&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;(f) Set forth on <u>Section 3.17(f) of the Disclosure Schedule</u> is an accurate and complete list and description of all Seller Software that is material to and used by the Business. None of the source code owned or purported to be owned by Seller has been published, disclosed, or put into escrow by Seller for any reason. Seller does not use any Open Source Software or any modification or derivative thereof (A) in a manner that would grant or purport to grant to any Person any rights to or immunities under any of the Seller-Owned Intellectual Property that is material to and used by the Business, or (B) under any license requiring Seller to disclose or distribute the source code to any of the Seller Software, to license or provide the source code to any of the Seller Software for the purpose of making derivative works, or to make available for redistribution to any Person the source code to any of the Seller Software at no or minimal charge, each with respect to Software that is material to and used by the Business. Seller is in compliance in all material respects with the obligations under any agreement pursuant to which Seller has obtained the right to use any Open Source Software.

&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;(g) Seller is and has been in compliance for the past three (3) years in all material respects with all applicable Information Privacy and Security Laws. Seller is and has been in compliance for the past three (3) years with, to the extent applicable: (i) all Contracts or other arrangements in effect between Seller and any third party that apply to or restrict the collection, use, disclosure, or security of Personal Information by Seller or by any other party to such Contracts or other arrangements ("<u>Privacy Agreements</u>"); (ii) the terms of any notices, consents, authorizations, waivers of authorization or other permissions pursuant to which Seller accesses, uses, or discloses, or has accessed, used or disclosed, Personal Information ("<u>Privacy Consents</u>"); (iii) all public-facing, written privacy policies and similar disclosures or assurances published, adopted, or provided by Seller (the "<u>Privacy Policies</u>"); and (iv) the Payment Card Industry Data Security Standard issued by the PCI Security Standards Council, as it may be amended from time to time ("<u>PCI DSS</u>"). The Information Privacy and Security Laws, Privacy Agreements, Privacy Consents, Privacy Policies, and PCI DSS are collectively referred to herein as the "<u>Privacy Requirements</u>." Seller has, and has since inception maintained, physical, technical, organizational and administrative security safeguards that comply with all applicable Information Privacy and Security Laws and Privacy Policies and are commercially reasonable and consistent with industry-standards, to protect all Personal Information collected by or on behalf of Seller from and against unauthorized access, use and/or disclosure. Seller has not notified, either voluntarily or as required by any Information Privacy and Security Law, any affected individual, any customer, any Governmental Authority, or the media of any breach or non-permitted use or disclosure of Personal Information, and Seller is not currently required under Information Privacy and Security Laws to conduct any such notification or investigating. There have been no data security incidents or data breaches related to Personal Information in the custody and/or control of Seller or, to the Knowledge of Seller, any service provider or subcontractor of Seller, that has materially interrupted the conduct of the Business or required Seller to provide notice to a third party. Seller has a data breach response plan in place which is commercially reasonable for Seller's size and the nature of the 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;&nbsp;&nbsp;&nbsp;&nbsp;(h) Seller (i) has undertaken all surveys, audits, inventories, reviews, analyses, or assessments (including any risk assessments) required by all applicable Information Privacy and Security Laws (collectively, "<u>Information Security Reviews</u>"), (ii) timely corrected or mitigated any material exceptions or high-risk vulnerabilities identified in such Information Security Reviews, and (iii) installed generally available software security patches and other fixes to identified technical information security vulnerabilities known by Seller in accordance with the Privacy Requirements and industry standards. To

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the Knowledge of Seller, in the last three (3) years, there have been no complaints to, or investigations or inquiries by, any Governmental Authority with respect to compliance by Seller or Seller's subcontractors or agents with any Information Privacy and Security Law. To the Knowledge of Seller, there are no audits, investigations, or other claims pending or threatened or likely to be asserted or threatened against Seller asserting non-compliance with the Privacy Requirements.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.18 <u>Customers and Suppliers</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;(a) <u>Section 3.18(a) of the Disclosure Schedule</u> sets forth (i) a true, correct, accurate, and complete list of the twenty (20) customers who generated the highest revenues for Seller for each of the year ended December 31, 2023, the year ended December 31, 2024, and the nine (9) months ended September 30, 2025 (collectively, the "<u>Material Customers</u>") and (ii) the total revenues attributable to each such Top Customer for each such 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;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Section 3.18(b) of the Disclosure Schedule</u> sets forth (i) a true, correct, accurate, and complete list of the ten (10) vendors to whom Seller made the greatest expenditures for each of the year ended December 31, 2023, the year ended December 31, 2024, and the nine (9) months ended September 30, 2025 (collectively, the "<u>Material Suppliers</u>") and (ii) the total expenditures made to each such Material Supplier for each such 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;&nbsp;&nbsp;&nbsp;&nbsp;(c) No Material Supplier or Material Customer (i) has provided Seller any written notice terminating, suspending or reducing in any material respect, or specifying an intention to terminate, suspend or reduce in any material respect in the future, or otherwise reflecting a material adverse change in, the business relationship between such Material Supplier or Material Customer and Seller, or (ii) has cancelled or otherwise terminated any Material Contract, and to the Knowledge of Seller, no such Material Customer or Material Supplier intends to terminate, or not renew, its relationship with Seller, or adversely modify its sales to or purchases from Seller or its relationship with Seller.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.19 <u>Insurance</u>. <u>Section 3.19 of the Disclosure Schedule</u> sets forth a true and complete list of all insurance policies and self-insurance programs insuring Seller (collectively, the "<u>Insurance Policies</u>"), identifying for each Insurance Policy (a) the name of the insurer(s) thereunder, (b) the type of coverage provided thereunder, and (c) the amount and period covered thereby. The Insurance Policies (w) collectively provide coverage as is required by applicable Law and any Material Contracts and otherwise commercially standard, (x) have been made available to Purchaser prior to the date hereof, and (y) are in full force and effect and all premiums due and payable with respect thereto have been paid in full and Seller is in compliance therewith in all material respects Seller has not received any written or, to the Knowledge of Seller, oral notice of the impending cancellation, invalidation, or non-renewal of any Insurance Policy, that any claim or coverage thereunder will be refused or disputed or that any insurer is reserving any rights in connection therewith.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.20 <u>Brokers</u>. No broker, financial advisor, finder or investment banker or other Person is entitled to any broker's, financial advisor's, finder's or other fee or commission, or any other payment or other amount, in connection with the transactions contemplated by this Agreement based upon arrangements made by or on behalf of Seller.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.21 <u>Affiliated Transactions</u>. Except as set forth in <u>Section 3.21 of the Disclosure Schedule</u>, (a) no owner (including any shareholder), manager, director, employee or officer of Seller (any such individual, a "<u>Seller Related Person</u>") or, to the Knowledge of Seller, any Affiliate or member of the immediate family of any Seller Related Person is or has been (i) a customer (other than with respect to de minimis purchases for personal use), vendor, landlord, tenant, or other business relation of Seller (other than as an owner, shareholder, manager, director, employee or officer), (ii) a direct or indirect owner or Affiliate of any

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## customer, vendor, landlord, tenant, or other business relation of Seller, or (iii) a party to any transaction, Contract, or other business arrangement or relationship with or involving Seller (other than as an owner, shareholder, manager, director, employee or officer), and (b) no Seller Related Person or, to the Knowledge of Seller, any Affiliate or member of the immediate family of any Seller Related Person, owns any asset or property of any nature whatsoever used by Seller in the conduct of the Business.
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.22 <u>Ownership and Sufficiency of Assets</u>. Except as set forth in <u>Section 3.22 of the Disclosure Schedule</u>, (a) Seller has good and valid title to, a valid leasehold interest in, or a valid license to, all of the Acquired Assets, free and clear of any Liens, (b) Seller has not pledged any such Acquired Asset to a third Person, (c) to the Knowledge of Seller, the Acquired Assets are sufficient for the continued conduct of the Business after the Closing in substantially the same or similar manner as conducted prior to the Closing, and (d) the Acquired Assets are in good working order and condition (ordinary wear and tear excepted).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.23 <u>Solvency</u>. Seller is neither insolvent nor will it be rendered insolvent by any of the transactions contemplated by this Agreement. As used in this <u>Section 3.23</u>, "insolvent" means that the sum of the debts and other liabilities of Seller exceeds the present fair saleable value of Seller's assets.

# Article IV. <br>REPRESENTATIONS AND WARRANTIES OF PURCHASER
Purchaser hereby represents and warrants to Seller that the following statements are true and correct as of the date of this Agreement (or, if made as of a specified date, as of such date):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.1 <u>Organization</u>. Purchaser is a limited liability company duly organized, validly existing and in good standing under the Laws of the State of Delaware and has all the requisite power and authority to own, lease and operate its properties and to carry on its business as it is now being conducted.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.2 <u>Authority; Enforceability</u>. Purchaser has all necessary corporate power and authority to execute and deliver this Agreement, each other Transaction Document to which it is a party and each instrument required to be executed and delivered by it hereunder, to perform its obligations hereunder and thereunder and to consummate the transactions contemplated hereby and thereby. The execution and delivery by Purchaser of this Agreement, each other Transaction Document to which it is a party and each instrument required hereby to be executed and delivered by Purchaser hereunder, the performance of its obligations hereunder and thereunder and the consummation of the transactions contemplated hereby and thereby have been duly and validly authorized by all necessary action on the part of Purchaser, and no other action on the part of Purchaser is necessary to authorize this Agreement, any other Transaction Document to which it is a party or any instrument required to be executed and delivered by it hereunder or the consummation of the transactions contemplated hereby or thereby. This Agreement has been duly and validly executed and delivered by Purchaser and, assuming the due authorization, execution and delivery thereof by Seller, constitutes a legal, valid and binding obligation of Purchaser, enforceable against it in accordance with its terms, subject to the effects of bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and other similar Laws relating to or affecting creditors' rights generally and general equitable principles (whether considered in a proceeding in equity or at law).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.3 <u>No Conflict; Required Filings and Consents</u>. The execution and delivery by Purchaser of this Agreement, the other Transaction Documents to which it is a party or any instrument required by this Agreement to be executed and delivered by it hereunder do not, and the performance of this Agreement, the other Transaction Documents to which it is a party and any instrument required by this Agreement to be executed and delivered by it hereunder will not, (a) conflict with, require a consent or notice under or violate the Governing Documents of Purchaser, (b) conflict with, require a consent or notice under or violate any Law or Order applicable to Purchaser or by which any of its properties, rights or assets is bound or

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## affected or (c) result in any material breach or violation of, require a consent or notice under, or constitute a material default under, or materially impair Purchaser's rights or alter the rights or obligations of any party under, or give to others any rights of termination, amendment, acceleration or cancellation of, or result in the creation of a Lien on any of the properties, rights or assets of Purchaser pursuant to, any material Contract to which Purchaser is a party, or by which Purchaser or its properties, rights or assets is or are bound or affected.
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.4 <u>Absence of Litigation, Claims and Orders</u>. As of the date hereof, there are no Claims pending or, to Purchaser's knowledge, threatened on behalf of or against Purchaser that (a) challenges (i) the validity of this Agreement or any other Transaction Document to which Purchaser is a party or (ii) any action taken or to be taken by Purchaser pursuant to this Agreement or any other Transaction Documents to which Purchaser is a party or in connection with the transactions contemplated hereby and thereby, (b) could impair or delay the transactions contemplated hereby or the ability to consummate the transactions contemplated hereby or (c) could adversely affect Purchaser's performance under this Agreement or the consummation of the transactions contemplated hereby.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.5 <u>Brokers</u>. No broker, financial advisor, finder or investment banker or other Person is entitled to any broker's, financial advisor's, finder's or other fee or commission in connection with the transactions contemplated by this Agreement based upon arrangements made by or on behalf of Purchaser.

# Article V. <br>COVENANTS
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.1 <u>Further Assurances</u>. Following the Closing, and without further consideration, each Party shall promptly execute and deliver all such agreements, amendments, instruments, certificates, forms, filings, or other documents, and shall take or refrain from taking all such other action, in each case, as may be reasonably requested by or on behalf of any other Party (at such other Party's sole expense) in order to carry out the provisions hereof and give effect to the transactions contemplated by this Agreement; <u>provided</u>, <u>however</u>, that this <u>Section 5.1</u> shall not require any Party to waive any rights it may have hereunder or under any other documents contemplated hereby, to waive any breach hereof or of any other documents contemplated hereby, or to enter into any amendment of this Agreement or any other documents contemplated hereby in a manner materially adverse to such Party.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.2 <u>Publicity</u>. The Parties agree that any press release with respect to this Agreement and the transactions contemplated hereby shall be a press release of Purchaser, in a form mutually agreed to by Purchaser and Seller; <u>provided</u>, <u>however</u>, that nothing contained herein will limit any Party from making (or require the other Party's consent to) any announcements, statements or acknowledgments that such Party is required by applicable Law to make, issue or release.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.3 <u>Customer and Business Relationships</u>. After the Closing, upon the reasonable request of Purchaser, Seller will cooperate with Purchaser in its efforts to continue and maintain for the benefit of Purchaser those business relationships of Seller existing prior to the Closing and relating to the Business to be operated by Purchaser after the Closing, including relationships with lessors, employees, regulatory authorities, licensors, customers, suppliers and others. Seller will refer to Purchaser all inquiries relating to the Business. Neither Seller nor any of its Affiliates shall take any action that would tend to diminish the value of the Acquired Assets after the Closing or that would interfere with the Business of Purchaser to be engaged in after the Closing, including disparaging the name or business of Purchaser.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.4 <u>Expenses</u>. Except as expressly provided in this Agreement, each Party shall pay its own respective costs and expenses incurred or to be incurred by such Party in negotiating and preparing this Agreement and the other Transaction Documents, and in performing such Party's obligations under this

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## Agreement and the other Transaction Documents and carrying out and closing the transactions contemplated hereby and thereby. Except as otherwise explicitly provided in the Escrow Agreement, each Party shall be responsible for one-half of the fees due to Escrow Agent.
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.5 <u>Restrictive 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;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Non-Competition</u>. Seller agrees that, from and after the Closing Date for a period of five (5) years (the "<u>Restricted Period</u>"), Seller shall not, directly or indirectly, own, operate, lease, manage, control, engage in, invest in, lend to, own any debt or equity security or interest of, permit its name to be used by, act as a director, manager, partner, consultant, or advisor to, render services for or to (alone or in association with any Person), or otherwise participate or assist any Person (other than Purchaser and its Affiliates) engaged (or planning to become engaged) in any Competing Business anywhere in the Restricted Territory.

&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;(b) <u>Non-Hire</u>. During the Restricted Period, Seller shall not, directly or indirectly, in any manner, hire, engage, or solicit for employment (or engagement as a consultant) any Person who (i) was employed (or engaged as a consultant) by Seller during the one (1) year period prior to Closing, or (ii) is or was employed (or engaged as a consultant) by Purchaser or any of its Affiliates during the one (1) year period prior to such solicitation, or encourage or induce or attempt to encourage or induce any such employee or consultant to leave such employment or engagement, except that the foregoing prohibition on solicitation shall not prohibit a general solicitation by means of general advertisement that is not specifically directed at such employees or consultants.

&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;(c) <u>Non-Solicitation</u>. During the Restricted Period, Seller shall not, directly or indirectly, in any manner, (i) encourage or induce or attempt to encourage or induce any Person who is, or was within two (2) years prior to the date thereof, a supplier, licensor, customer, client or other business relation of Seller, Purchaser, or Purchaser's Affiliates (such supplier, licensor, customer, client or other business relation collectively, the "<u>Seller Relations</u>") to cease doing business or modify the way it does business with Purchaser or its Affiliates or in any way negatively interfere with or otherwise intentionally adversely affect the relationship between any Seller Relation and Purchaser or its Affiliates; or (ii) solicit any Seller Relation for a Competing Business (including, without limitation, any business providing the same types of services or selling the same types of products as those provided or sold by Seller at or prior to Closing).

&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;(d) <u>Confidentiality</u>. From and after the Closing, Seller shall, and shall cause its representatives and agents to, hold in confidence (and not disclose or provide access to any other Person) and not use, any and all Confidential Information, whether written or oral. If Seller or any of its representatives or agents is compelled to disclose any information by judicial or administrative process or by other requirements of Law, Seller shall promptly notify Purchaser in writing and shall disclose only that portion of such information that Seller is advised by its counsel in writing is legally required to be disclosed; <u>provided</u>, <u>however</u>, that Seller (or representative on its behalf) shall use commercially reasonable efforts to obtain, and immediately notify Purchaser in writing so that Purchaser shall be able to seek to obtain (at Purchaser's sole expense), an appropriate protective Order or other reasonable assurance that confidential treatment will be accorded such information. Notwithstanding anything to the contrary set forth in this Agreement, Seller shall be permitted to use Confidential Information of Seller solely in connection with their confidential Tax or accounting purposes, legal compliance, or to enforce their respective rights under this Agreement or the other Transaction Documents.

&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) <u>Severability; Reformation</u>. Seller acknowledges that each of <u>Section 5.5(a)</u>, <u>Section 5.5(b)</u>, <u>Section 5.5(c)</u> and <u>Section 5.5(d)</u> is reasonable and necessary to protect Purchaser's significant investment from unfair competition, solicitation and interference. Seller acknowledges the substantial consideration and benefits being received Seller hereunder, and as consideration for such

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benefits, Seller hereby agrees to be bound by the covenants contained in this <u>Section 5.5</u>. Seller further acknowledges that Purchaser would not have entered into this Agreement but for Seller's agreement to be bound by the covenants contained in this <u>Section 5.5</u>. If it is determined by a court of competent jurisdiction that any of the restrictions contained in this <u>Section 5.5</u> (or any part thereof) are unenforceable because of the scope thereof or for any other reason, such court shall modify the scope of such restriction as minimally as necessary for such restriction to be enforceable, and such restriction shall thereafter be enforced.

&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;(f) <u>Injunctive Relief</u>. Seller acknowledges and agrees that a breach of any of the covenants set forth in this <u>Section 5.5</u> cannot be reasonably or adequately compensated for with damages in a Proceeding and that Purchaser will therefore be entitled to equitable relief (including (i) injunctive relief restraining Seller from engaging in any action which would constitute or cause a breach or violation of this <u>Section 5.5</u> and (ii) specific performance to compel Seller to comply with the obligations and covenants in this <u>Section 5.</u>5 without having to post any bond or undertake any other action or obligation and in addition to all other available remedies. Notwithstanding anything herein to the contrary, the Parties acknowledge and agree that any amount set forth in Tax Allocation Schedule with respect to the restrictive covenants set forth in this Agreement (including those contained in this <u>Section 5.5</u>) shall not in any way be deemed a "cap" on or other measurement of damages in the event of a breach of any restrictive covenants set forth herein and shall in no way limit or restrict Purchaser's or any other Purchaser Indemnified Person's recovery for such breach.

&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;(g) <u>Tolling</u>. In the event of a breach of any covenant set forth in this <u>Section 5.5</u>, the Restricted Period, as applicable, will be tolled and extended by the duration of such breach.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.6 <u>Certain Assigned Contracts</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;(a) To the extent that the assignment or attempted assignment by Seller to Purchaser of any Assigned Contract that is included among the Acquired Assets, or of any claim, right or benefit arising thereunder or resulting therefrom, is prohibited by any Law, or would require any consent, waiver, authorization or novation by or notice to any Person, and such consent, waiver, authorization, novation or notice has not been obtained or made prior to the Closing in a form and substance reasonably acceptable to Purchaser, or would be ineffective or would materially and adversely affect the rights of Seller or Purchaser thereunder, then neither this Agreement nor any other Transaction Document will constitute an assignment or attempted assignment thereof, and the same will not be assigned at the Closing. Subsequent to the Closing, Seller will use its commercially reasonable efforts and cooperate with Purchaser to obtain promptly all such consents, waivers, authorizations or novations and to timely give all notices required with respect to the Assigned Contracts that are included among the Acquired Assets, in form and substance reasonably acceptable to Purchaser. Seller will bear and pay the cost of all filing, recordation and similar fees and Taxes incurred after the date hereof and payable to any Governmental Authority in connection with the assignment of the Assigned Contracts that are included among the Acquired Assets and any additional fees or charges (howsoever denominated) required by any Person in connection with the assignment of any of the Assigned Contracts that are included among the Acquired Assets or any related consent, waiver, authorization, novation or notice.

&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;(b) If any consent, waiver, authorization, novation or notice that is required for the effective assignment to Purchaser of any Assigned Contract that is included among the Acquired Assets cannot be obtained or made and, as a result, the material benefits of such Assigned Contract cannot be provided to Purchaser following the Closing as otherwise required in accordance with this Agreement, then Seller will use its commercially reasonable efforts to provide Purchaser with the economic (taking into account all burdens and benefits, including Tax costs and benefits) and operational benefits, to the extent permitted therein, of any such Assigned Contract, and to permit Purchaser to perform Seller's obligations and enforce Seller's rights under such Assigned Contract as if such Assigned Contract had been assigned to Purchaser (and as if Seller had obtained or made such consent, waiver, authorization, novation, or notice,

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as the case may be), including (i) enforcing, at Purchaser's request, any rights of Seller arising with respect thereto, including the right to terminate such Assigned Contract upon the request of Purchaser and (ii) permitting Purchaser to enforce any rights arising with respect thereto. Subject to the terms below regarding the reimbursement of Seller for costs associated with administering any Assigned Contract on behalf of Purchaser, Seller will pay to Purchaser, when received, all income, proceeds and other monies received by such Seller from third parties to the extent related to Purchaser's intended rights under any Assigned Contract, as contemplated by this Agreement, including this <u>Section 5.6</u>. Once any such consent, waiver, authorization or novation is obtained or notice is properly made in form and substance reasonably acceptable to Purchaser, Seller will assign such Assigned Contract to Purchaser at no additional cost to Purchaser. Any expenses incurred by Seller in connection with the arrangements contemplated by this <u>Section 5.6</u> as it relates to the administration of any Assigned Contract by Seller on behalf of Purchaser for the period before it is assigned to Purchaser will be borne by Purchaser. For purposes of this <u>Section 5.6</u>, it shall be reasonable for Purchaser not to accept the form and substance of any consent, waiver, authorization, novation or notice if it (i) changes or modifies, in any material respect, any Assigned Contract, or (ii) results in any material incremental cost to, or obligation on, Purchaser.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.7 <u>Names; Domain Name</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;(a) From and after the Closing Date, Seller will cease to use the trade names included among the Acquired Assets (which includes "DebtX" and "Debt Exchange" and all confusingly similar variants thereof) (collectively, the "<u>Names</u>")), except in connection with Tax Returns relating to periods prior to the Closing. Within ten (10) Business Days following the Closing Date, Seller will (a) take all necessary actions, including the filing of any documents, to change its corporate and any assumed names to names not confusingly similar to the Names and (b) deliver to Purchaser a true, correct and complete copy of the filings showing that each such name change has occurred.

&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;(b) At the Closing, Seller shall take all actions necessary to convey any Domain Names (including the Domain Names set forth on <u>Section 3.17(a)(iii) of the Disclosure Schedule</u>) included among the Acquired Assets to Purchaser. Seller hereby appoint Purchaser as its attorney-in-fact to file all such documents and update all such information on or after the Closing Date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.8 <u>Receivables</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;(a) Seller will hold and promptly remit to Purchaser any cash, checks (with appropriate endorsements), payments, invoices or other property, received by it following the Closing which (a) are included among the Acquired Assets, or (b) properly belong to Purchaser under any Transaction Document. Purchaser will have the right and authority to collect for its own account all accounts receivable included among the Acquired Assets and other items that are included in the Acquired Assets and to endorse with the name of Seller any checks or drafts received with respect to any such accounts receivable or other items.

&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;(b) Purchaser will hold and promptly remit to Seller any cash, checks (with appropriate endorsements), payments, invoices or other property, received by it following the Closing which (a) are not included as an Acquired Asset, including pursuant to <u>Section 2.1(a)(i)</u> hereof, (b) are included among the Excluded Assets, or (c) properly belong to Seller pursuant to or under any Transaction Document. Seller will have the right and authority to collect for its own account all accounts receivable included among the Excluded Assets and other items that are included in the Excluded Assets and to endorse with the name of Purchaser any checks or drafts received with respect to any such accounts receivable or other items.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.9 <u>Bulk Sales Laws</u>. The Parties hereby waive compliance with the provisions of any bulk sales, bulk transfer or similar Laws of any jurisdiction that may otherwise be applicable with respect to the sale of any or all of the Acquired Assets to Purchaser; it being understood that any liabilities arising out of the failure of Seller to comply with the requirements and provisions of any bulk sales, bulk transfer or

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## similar Laws of any jurisdiction which would not otherwise constitute Assumed Liabilities shall be treated as Excluded Liabilities.
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.10 <u>Pre-Closing Taxes</u>. Any and all ad valorem or similar Taxes (other than the Transfer Taxes) with respect to the Acquired Assets for any Straddle Period shall be prorated between Seller and Purchaser. Seller's portion of any such Taxes shall be equal to the amount of Tax for the Straddle Period multiplied by a fraction, the numerator of which shall be the number of days from the beginning of the Straddle Period through the Closing Date and the denominator of which shall be the total number of days in the Straddle Period. Purchaser's portion of any such Taxes shall be equal to the amount of Tax for the Straddle Period multiplied by a fraction, the numerator of which shall be the number of days in the Straddle Period after the Closing Date and the denominator of which shall be the total number of days in the Straddle Period. In the event that any Party pays any Taxes for which the other Party is obligated in whole or in part under this <u>Section 5.10</u>, the former shall present the latter with a statement setting forth the latter's proportionate share, and the latter shall promptly pay its share to the former.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.11 <u>Transfer Taxes</u>. Any transfer, documentary, sales, use, stamp, registration and other similar Taxes and fees incurred in connection with the transfer of the Acquired Assets to Purchaser (collectively, the "<u>Transfer Taxes</u>") shall be paid by 50% by Seller and 50% by Purchaser, and Purchaser and Seller shall reasonably cooperate with respect to the filing of any Tax Returns and exemption certificates related thereto.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.12 <u>Cooperation</u>. Seller and Purchaser shall provide each other with such cooperation and information as either of them reasonably may request of the other in filing any Tax Return or with respect to any audit by any Tax authority or other Tax authority proceeding in respect of Taxes for any taxable period that includes the date of the Closing and for all prior taxable periods, in each case, with respect to the Acquired Assets or the Business.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.13 <u>Payment of Other Excluded Liabilities</u>. In addition to payment of Taxes pursuant to <u>Section 5.10</u> or <u>Section 5.11</u>, Seller shall pay, or make adequate provision for the payment, in full all of the Excluded Liabilities and other liabilities of Seller under this Agreement. If any such liabilities are not so paid or provided for, or if Purchaser reasonably determines that failure to make any payments will impair Purchaser's use or enjoyment of the Acquired Assets or conduct of the Business, Purchaser may, at any time after the Closing Date, elect to make all such payments directly (but shall have no obligation to do so) and set off and deduct the full amount of all such payments from any amounts due to Seller under this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.14 <u>Seller Release</u>. Seller, on such its own behalf and on behalf of its successors, trustees, executors, administrators, permitted assigns and any other Person that may claim by, through or in the right of Seller, as applicable (collectively, the "<u>Releasing Parties</u>"), hereby irrevocably waives, releases and discharges Purchaser and each of its Affiliates (collectively, the "<u>Released Parties</u>") from any and all Proceedings, causes of actions, demands, rights, damages, Indebtedness, liabilities, dues, sums of money, accounts, reckonings, costs, expenses, responsibilities, covenants, contracts, controversies, agreements and claims of any kind or nature whatsoever that such Person now has or may have ever had, whether in such Releasing Party's capacity as an equityholder, employee, officer, manager or director of the Business or otherwise (including any right to indemnification or exculpation with respect to any losses) and whether absolute or contingent, liquidated or unliquidated, known or unknown, and such Releasing Party shall not seek to recover any amounts or any other remedy in connection therewith or thereunder from any Released Party; provided, however, that the foregoing release will not be construed to apply to or release any claims (a) relating to or arising under this Agreement or the Transaction Documents or (b) which are not permitted to be released under applicable Law.

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# Article VI. <br>INDEMNIFICATION
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.1 <u>Survival</u> . All representations, warranties, covenants, and obligations in this Agreement, the Schedules attached hereto, and any other certificate or document delivered pursuant to this Agreement will survive the Closing and the consummation of the Transactions, subject to <u>Section 6.4</u>. Except to the extent Purchaser has knowledge as of the Closing Date of any breach or inaccuracy of any of the representations or warranties in this Agreement, the right to indemnification, reimbursement, or other remedy based on such representations, warranties, covenants and obligations will not be affected by any investigation conducted with respect to, or any knowledge acquired (or capable of being acquired) about, the accuracy or inaccuracy of or compliance with, any such representation, warranty, covenant or obligation. For purposes of this Section 6.1, the "knowledge" of Purchaser means the actual knowledge of Ross Dove, Brian Cobb, Nick Dove or James Sklar.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.2 <u>Indemnification and Reimbursement by Seller</u>. Seller shall indemnify and hold harmless Purchaser, its Affiliates, and their respective officers, directors, members, stockholders, employees, representatives and agents (collectively, the "<u>Purchaser Indemnified Persons</u>"), and shall reimburse the Purchaser Indemnified Persons, including through the right of Purchaser to assert a claim against the General Escrow Amount or the Patent Litigation Escrow Amount, as applicable, as provided in <u>Section 6.7</u> hereof, for Losses, arising, directly or indirectly, from or in connection with:

&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;(a) any inaccuracy or breach of any representation or warranty of Seller contained in this Agreement or any other Transaction Document to which Seller is a party;

&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;(b) the breach by Seller of any of its covenants, obligations or agreements contained in this Agreement or any other Transaction Document to which Seller is a party;

&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;(c) any liability for (i) Taxes of Seller (or any Affiliate of Seller) for any taxable period, including without limitation, (A) Taxes relating to the Business, the Acquired Assets or the Assumed Liabilities for any Pre-Closing Tax Period and (B) any other Taxes of Seller (or any Affiliate of Seller) of any kind or description; or (ii) Taxes that are the responsibility of Seller pursuant to this Agreement (including pursuant to <u>Section 5.11</u> hereof);

&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;(d) any Indebtedness of Seller as of the time of Closing, to the extent not included at the time of Closing in the determination of the Closing Cash 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;&nbsp;&nbsp;&nbsp;&nbsp;(e) any Seller Transaction Expenses, to the extent not included at the time of Closing in the determination of the Closing Cash Amount; 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;&nbsp;&nbsp;&nbsp;&nbsp;(f) any Excluded Asset or Excluded Liability.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.3 <u>Indemnification and Reimbursement by Purchaser</u>. Purchaser shall indemnify and hold harmless Seller and its Affiliates, and their respective officers, directors, stockholders, employees, representatives and agents (collectively, the "<u>Seller Indemnified Persons</u>"), and shall reimburse the Seller Indemnified Persons for any Losses arising, directly or indirectly, from or in connection with:

&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;(a) any breach of, or inaccuracy in, any representation or warranty made by Purchaser in this Agreement or the Transaction Documents;

&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;(b) any breach of any covenant or agreement of Purchaser in this Agreement or the Transaction Documents;

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&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;(c) any liability for (i) Taxes of Purchaser (or any Affiliate of Purchaser) for any taxable period, including without limitation, (A) Taxes relating to the Business, the Acquired Assets or the Assumed Liabilities for any Post-Closing Tax Period and (B) any other Taxes of Purchaser (or any Affiliate of Purchaser) of any kind or description; or (ii) Taxes that are the responsibility of Purchaser pursuant to this Agreement (including pursuant to <u>Section 5.11</u> hereof);

&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;(d) any Assumed Liability.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.4 <u>Limitations</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;(a) <u>Time Limitations</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;&nbsp;&nbsp;&nbsp;&nbsp;(i) Seller will not have any indemnification liability for the breach of any representation or warranty set forth in <u>Article III</u>, unless on or before the fifteen (15) month anniversary of the Closing Date, Purchaser notifies Seller of a claim or potential claim specifying the factual basis of that claim in reasonable detail to the extent then known by Purchaser; <u>provided</u>, <u>however</u>, that any claim with respect to breaches of <u>Sections 3.1</u> (Organization and Qualification), <u>3.3</u> (Capitalization), <u>3.5</u> (Authority; Enforceability), subpart (a) and subpart (b) of <u>3.7</u> (No Conflict; Required Filings and Consents), <u>3.12</u> (Absence of Litigation, Claims and Orders), <u>3.16</u> (Taxes), and <u>3.20</u> (Brokers) (collectively, the "<u>Fundamental Representations</u>"), may be made by Purchaser at any time prior to the third (3<sup>rd</sup>) anniversary of the Closing Date, but not afterwards.

&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;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Purchaser will have no indemnification liability for the breach of any representation or warranty set forth in <u>Article IV</u>, unless on or before the twelve (12) month anniversary of the Closing Date, Seller notifies Purchaser of a claim specifying the factual basis of that claim in reasonable detail to the extent then known by Seller; <u>provided</u>, <u>however</u>, that any claim with respect to breaches of <u>Sections 4.1</u> (Organization), <u>4.2</u> (Authority; Enforceability), and <u>4.5</u> (Brokers) may be made by Seller at any time prior to the third (3<sup>rd</sup>) anniversary of the Closing Date, but not afterwards.

&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;&nbsp;&nbsp;&nbsp;&nbsp;(iii) The covenants and agreements herein that contemplate performance following the Closing shall survive the Closing and remain in full force and effect until fully performed or for the term stated therein, and the covenants and agreements herein that are indefinite shall survive the Closing and remain in full force and effect in perpetuity.

&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;(b) <u>Seller Monetary Limitations</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;&nbsp;&nbsp;&nbsp;&nbsp;(i) Seller has no obligation to indemnify the Purchaser Indemnified Persons pursuant to <u>Section 6.2(a)</u> of this Agreement (other than with respect to the Fundamental Representations or Fraud), unless the aggregate amount of all such Losses incurred or suffered by the Purchaser Indemnified Persons exceeds $45,000.00 (the "<u>Deductible</u>") (at which point Seller shall indemnify and hold harmless the Purchaser Indemnified Persons for all such Losses in excess of the Deductible).

&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;&nbsp;&nbsp;&nbsp;&nbsp;(ii) The aggregate liability of Seller in respect of claims for indemnification pursuant to <u>Section 6.2(a)</u> of this Agreement (other than with respect to the Fundamental Representations or Fraud)) is not to exceed the General Escrow Amount (the "<u>Cap</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;&nbsp;&nbsp;&nbsp;&nbsp;(iii) The Deductible and the Cap shall not apply to Seller's obligation to indemnify and hold Purchaser Indemnified Persons harmless from and against Losses incurred by Purchaser Indemnified Persons in connection with, arising out of, resulting from or based upon an inaccuracy in or a breach of any Fundamental Representations or for Fraud or any of the matters described in <u>Section 6.2(b)</u> through <u>6.2(f)</u>; <u>provided</u>, <u>however</u>, in no event shall Seller's liability for any indemnification claim based

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upon an inaccuracy in or a breach of any Fundamental Representations or any of the matters described in <u>Section 6.2(c)</u> through <u>6.2(e)</u> exceed one-half of the Base Purchase Price.

&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;(c) <u>Purchaser Monetary Limitations</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;&nbsp;&nbsp;&nbsp;&nbsp;(i) Purchaser is to have no obligation to indemnify the Seller Indemnified Persons pursuant to <u>Section 6.3(a)</u> of this Agreement unless the aggregate amount of all such Losses incurred or suffered by the Seller Indemnified Persons exceeds the Deductible (at which point Purchaser shall indemnify and hold harmless the Seller Indemnified Persons for all such Losses from dollar one).

&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;&nbsp;&nbsp;&nbsp;&nbsp;(ii) The aggregate liability of Purchaser in respect of claims for indemnification pursuant to <u>Section 6.3(a)</u> of this Agreement (other than with respect to breaches of <u>Sections 4.1</u> (Organization), <u>4.2</u> (Authority; Enforceability), or <u>4.5</u> (Brokers) or for Fraud) is not to exceed the Cap.

&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;&nbsp;&nbsp;&nbsp;&nbsp;(iii) The limitations set forth in <u>Sections 6.4(c)(i)</u> and <u>(ii)</u> of this Agreement and <u>Section 6.4(a)(ii)</u> of this Agreement are not to apply to claims for indemnification pursuant to <u>Section 6.3(b)</u> of this Agreement, of which the aggregate liability of Purchaser is not to exceed one-half of the Base Purchase Price.

Nothing contained herein (including <u>Sections 6.4(a)(i)</u> and <u>6.4(b)</u>) shall limit or restrict any Purchaser Indemnified Person's or Seller Indemnified Person's right to maintain or recover any amounts in connection with any action or claim based upon Fraud.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.5 <u>Third-Party Claims</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;(a) Promptly after receipt by a Person entitled to indemnity under <u>Section 6.2</u> or <u>6.3</u> (an "<u>Indemnified Person</u>") of notice of the assertion of any claim against any Indemnified Person by a third party (a "<u>Third-Party Claim</u>"), such Indemnified Person shall give notice to the Person obligated to indemnify under such Section (an "<u>Indemnifying Person</u>") of the assertion of such Third-Party Claim, provided that the failure to notify the Indemnifying Person will not relieve the Indemnifying Person of any Losses that it may have to any Indemnified Person, except to the extent that the Indemnifying Person demonstrates that the defense of such Third-Party Claim is prejudiced by the Indemnified Person's failure to give such notice.

&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;(b) If an Indemnified Person gives notice to the Indemnifying Person pursuant to <u>Section 6.5(a)</u> of the assertion of a Third-Party Claim, the Indemnifying Person shall be entitled to participate in the defense of such Third-Party Claim and, to the extent that it wishes (unless (i) the Indemnifying Person is also a Person against whom the Third-Party Claim is made and the Indemnified Person determines in good faith that joint representation would be inappropriate, (ii) the Indemnifying Person fails to provide reasonable assurance to the Indemnified Person of its financial capacity to defend such Third-Party Claim and provide indemnification with respect to such Third-Party Claim or (iii) such Third-Party Claim relates to or arises in connection with any criminal or quasi-criminal Proceeding or any Proceeding by a Governmental Authority pursuant to Taxes or Tax matters imposed on Purchaser), to assume the defense of such Third-Party Claim with counsel satisfactory to the Indemnified Person. After notice from the Indemnifying Person to the Indemnified Person of its election to assume the defense of such Third-Party Claim, the Indemnifying Person shall not, so long as it diligently conducts such defense, be liable to the Indemnified Person under this <u>Article VI</u> for any fees of other counsel or any other expenses with respect to the defense of such Third-Party Claim, in each case subsequently incurred by the Indemnified Person in connection with the defense of such Third-Party Claim, other than reasonable costs of investigation. If the Indemnifying Person assumes the defense of a Third-Party Claim, (i) such

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assumption will conclusively establish for purposes of this Agreement that the claims made in that Third-Party Claim are within the scope of and subject to indemnification, (ii) no compromise or settlement of such Third-Party Claims may be effected by the Indemnifying Person without the Indemnified Person's consent (such consent not to be unreasonably withheld, conditioned or delayed) unless (A) there is no finding or admission of any violation of any Law or any violation of the rights of any Person; (B) the sole relief provided is monetary damages that are paid in full by the Indemnifying Person; and (iii) the Indemnified Person shall have no liability with respect to any compromise or settlement of such Third-Party Claims effected without its consent. In the event that the Indemnifying Person declines or is not entitled to participate in or assume the defense of such Third-Party Claim, in accordance with the provisions of this <u>Section 6.5(b)</u>, any of the Indemnified Persons may undertake such defense and the Indemnifying Person shall reimburse the Indemnified Persons for their reasonable legal fees and expenses in connection therewith as and when such fees and expenses are incurred by them.

&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;(c) Notwithstanding the foregoing, if an Indemnified Person determines in good faith that there is a reasonable probability that a Third-Party Claim may adversely affect it or its Affiliates other than as a result of monetary damages for which it would be entitled to indemnification under this Agreement, the Indemnified Person may, by notice to the Indemnifying Person, assume the exclusive right to defend, compromise or settle such Third-Party Claim, but the Indemnifying Person will not be bound by any determination of any Third-Party Claim so defended for the purposes of this Agreement or any compromise or settlement effected without its consent (which may not be unreasonably withheld).

&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;(d) With respect to any Third-Party Claim subject to indemnification under this <u>Article VI</u>: (i) both the Indemnified Person and the Indemnifying Person, as the case may be, shall keep the other Person fully informed in all material respects of the status of such Third-Party Claim and any related proceedings at all stages thereof where such Person is not represented by its own counsel, and (ii) the Parties agree to render to each other such assistance as they may reasonably require of each other and to cooperate in good faith with each other in order to ensure the proper and adequate defense of any Third-Party Claim.

&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) With respect to any Third-Party Claim subject to indemnification under this <u>Article VI</u>, the Parties shall cooperate in such a manner as to preserve in full (to the extent possible) the confidentiality of all Confidential Information and the attorney-client and work-product privileges. In connection therewith, each Party agrees that: (i) it will use reasonable best efforts, in respect of any Third-Party Claim in which it has assumed or has participated in the defense, to avoid production of Confidential Information (consistent with applicable Law and rules of procedure), and (ii) all communications between any Parties hereto and counsel responsible for or participating in the defense of any Third-Party Claim will, to the extent possible, be made so as to preserve any applicable attorney-client or work-product privilege.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.6 <u>Order of Recovery</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;(a) Subject to the limitations contained elsewhere in this <u>ARTICLE VI</u>, as applicable, upon resolution of any claim by any Purchaser Indemnified Person for indemnification pursuant to <u>Section 6.2(a)</u> (other than with respect to the Fundamental Representations or Fraud), to the extent any funds remain in the General Escrow Account, Purchaser and Seller shall jointly instruct the Escrow Agent to disburse therefrom the amount due and owing in respect of such claim to Purchaser. For the avoidance of doubt, (x) other than with respect to the Fundamental Representations or Fraud, Seller shall have no liability to Purchaser Indemnified Persons under <u>Section 6.2(a)</u> in excess of the funds in the General Escrow Account, and (y) nothing in this <u>Section 6.7(a)</u> shall in any manner limit Purchaser Indemnified Persons with respect to claims for inaccuracies in or breaches of Fundamental Representations or Fraud or pursuant to <u>Section 6.2(b)</u> through <u>Section 6.2(e)</u>, for which claims Purchaser Indemnified Persons may obtain recovery as set forth in <u>Section 6.6(b)</u>.

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&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;(b) Subject to the limitations contained elsewhere in this <u>ARTICLE VI</u>, as applicable, upon resolution of any claim by any Purchaser Indemnified Person for indemnification in respect of any inaccuracy in or breach of Fundamental Representations or Fraud or pursuant to Section 6.2(b) through Section 6.2(g), the following order of recovery shall apply: (i) first, to the extent any funds remain in the General Escrow Account, Purchaser and Seller shall jointly instruct the Escrow Agent to disburse therefrom the amount due and owing in respect of such claim to Purchaser, and (ii) second, if no funds remain in the General Escrow Account, then Purchaser may seek recovery directly against Seller, but, for the avoidance of doubt, in no event may Purchaser seek recovery directly against Seller's directors, officers, employees, or, except in the case of Fraud, stockholders.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.7 <u>Release of Escrow Funds in Escrow Account</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;(a) Within five (5) Business Days following the date that is fifteen (15) months following the Closing Date (the "<u>General Escrow Release Date</u>"), Purchaser and Seller shall direct the Escrow Agent to release all funds remaining in the General Escrow Account to Seller to such account as Seller shall designate; provided, however, that no amount(s) subject to a pending claim for indemnification made by a Purchaser Indemnified Person pursuant to <u>Section 6.2</u> shall be do disbursed until the final resolution of such pending claim. To the extent that, on the General Escrow Release Date, any amount has been reserved and withheld from distribution from the General Escrow Account on such date on account of an unresolved claim for indemnification made by a Purchaser Indemnified Person pursuant to <u>Section 6.2</u> and, subsequent to the General Escrow Release Date, such claim is resolved, Purchaser and the Seller shall immediately direct the Escrow Agent to release (i) to the Purchaser Indemnified Persons the amount of Losses of Purchaser Indemnified Persons, if any, due and owing in respect of such claim as finally determined, and (ii) to Seller an amount equal to the excess, if any, of the amount theretofore reserved and withheld from distribution in respect of such claim over the payment, if any, made pursuant to the foregoing clause.

&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;(b) Within five (5) Business Days following the full, final, complete and non-appealable resolution and/or settlement of the GPE Patent Litigation Matter, Purchaser and Seller shall direct the Escrow Agent to release all funds remaining in the Patent Litigation Escrow Account *less* any Losses incurred by Purchaser, if any, arising from or in connection with the GPE Patent Litigation Matter, to Seller to such account as Seller shall designate. Seller hereby agrees to promptly provide Purchaser proof of such final resolution and/or settlement of the GPE Patent Litigation Matter for Purchaser's review prior to the release of the funds remaining in the Patent Litigation Escrow Account.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.8 <u>Exclusive Remedy</u>. The indemnification provided for in this <u>Article VI</u> shall be the exclusive post-Closing remedy available to an Indemnified Person in connection with any Losses arising out of the matters set forth in this Agreement or the transactions contemplated hereby, provided that nothing herein will limit any Indemnified Person's rights hereunder or otherwise to injunctive or other equitable relief to enforce its rights under this Agreement or otherwise in connection with the transactions contemplated hereby.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.9 <u>Treatment of Indemnification Payments</u>. Any payments made pursuant to the indemnification obligations arising under this Agreement shall be treated as an adjustment to the Base Purchase Price for all Tax purposes.

# Article VII. <br>MISCELLANEOUS
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.1 <u>Amendment</u>. This Agreement may not be amended other than in an instrument in writing signed by each of the Parties.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.2 <u>Waiver</u>. Neither the failure nor any delay by any Party in exercising any right under this Agreement or the documents referred to in this Agreement will operate as a waiver of such right, and no single or partial exercise of any such right will preclude any other or further exercise of such right or the exercise of any other right. No claim or right arising out of this Agreement or the documents referred to in this Agreement can be discharged by one Party, in whole or in part, by a waiver or renunciation of the claim or right unless in writing signed by the other Party. The rights and remedies of the Parties to this Agreement are cumulative and not alternative.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.3 <u>Notices</u>. All notices, requests, demands or other communications under this Agreement must be in writing and will be deemed to have been duly given to the Person designated below (i) on the date of delivery if delivered in person; (ii) on the third (3<sup>rd</sup>) Business Day following the deposit thereof in the United States mail, provided it is mailed by certified mail, return-receipt requested and postage prepaid and properly addressed; or (iii) on the earlier of actual receipt or second (2<sup>nd</sup>) Business Day after being sent by air courier or commercial delivery service. Any Party may from time to time, by written notice to the other Party, designate a different address, which will be substituted for the one specified below:

If to Purchaser:

Heritage DebtX LLC

c/o Heritage Global Inc.

6130 Nancy Ridge Drive

San Diego, CA 92121

Attention: James Sklar, EVP and General Counsel

E-mail: [Reserved]

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

Bass, Berry & Sims PLC

21 Platform Way South, Suite 3500

Nashville, Tennessee 37203

Attention: Curtis Capeling

E-mail: [Reserved]

If to Seller:

The Debt Exchange, Inc.

275 Grove Street, Suite 2-400

Newton, MA 02466

Attention: Kingsley Greenland

E-mail: [Reserved]

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

Alston & Bird LLP

One Atlantic Center

1201 W. Peachtree Rd.

Atlanta, Georgia 30309

Attention: Chris Baugher

E-mail: [Reserved]

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.4 <u>Enforcement of Agreement</u>. Each Party hereto acknowledges and agrees that the other Parties hereto would be damaged irreparably in the event any of the provisions of this Agreement are not performed in accordance with their specific terms and that any breach of this Agreement by such Party could not be adequately compensated by monetary damages. Accordingly, the Parties hereto agree that, in addition to any other right or remedy to which any Party hereto may be entitled, at law or in equity, the Parties hereto will be entitled to, among other remedies, and without posting any bond or other undertaking, injunctive relief, which may include, but will not be limited to: (a) restraining any other Party hereto from engaging in any action that would constitute or cause a breach or violation of this Agreement, (b) obtaining specific performance to compel any Party hereto to perform such Party's obligations and covenants under this Agreement, and (c) obtaining damages available either at law or in equity. If any Proceeding relating to this Agreement, or the enforcement of any provision of this Agreement is brought by a Party against any other Party, the prevailing Party will be entitled to recover reasonable attorney's fees, costs and disbursements (in addition to any other relief to which the prevailing Party may be entitled).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.5 <u>Headings; Construction</u>. The headings of Articles and Sections in this Agreement are provided for convenience only and will not affect its construction or interpretation. All Annexes, Exhibits and Schedules to this Agreement are incorporated into and constitute an integral part of this Agreement as if fully set forth herein. The statements in the Disclosure Schedule, and those in any supplement thereto, relate to the representations and warranties in the Section of the Agreement to which they expressly relate and to any other representation or warranty in this Agreement to the extent such information is, on its face, responsive to such other Section. The language used in the Agreement will be construed, in all cases, according to its fair meaning, and not for or against any Party hereto. Any rules of construction to the effect that any ambiguities are to be resolved against the drafting Party will not be available in the interpretation of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.6 <u>Severability</u>. If any term or provision of this Agreement is invalid, illegal or incapable of being enforced by any rule of Law or public policy, all other terms and provisions of this Agreement shall remain in full force and effect so long as the economic or legal substance of the transactions contemplated hereby is not affected in any manner adverse to any of the Parties. Upon such determination that any term or provision is invalid, illegal or incapable of being enforced, the Parties shall negotiate in good faith to amend or otherwise modify this Agreement so as to effect the original intent of the Parties as closely as possible in a mutually acceptable manner such that that transactions contemplated hereby are fulfilled to the fullest extent possible.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.7 <u>Entire Agreement</u>. This Agreement and the Transaction Documents (including all Annexes, Exhibits and Schedules (including the Disclosure Schedule) to this Agreement) and other documents and instruments delivered in connection herewith constitute the entire agreement among the Parties and supersede all prior representations, agreements, understandings and undertakings, whether written or oral, among the Parties, or any of them, with respect to the subject matter hereof and thereof (including the Confidentiality Agreement, which will be of no further force and effect as of the Closing), and no Party is relying on any other prior oral or written representations, agreements, understandings or undertakings with respect to the subject matter hereof and thereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.8 <u>Assignment</u>. This Agreement and the rights and obligations hereunder may not be assigned by any Party without the prior written consent of each of the other Parties. Subject to the preceding sentence, this Agreement will be binding upon, inure to the benefit of and be enforceable by the Parties and their respective legal successors and permitted assigns. Notwithstanding the foregoing, Purchaser may assign its rights and obligations under this Agreement, in whole or in part, in connection with any disposition or transfer of all or any portion of Purchaser's business in any form of transaction without the consent of Seller provided that Purchaser shall remain liable for any continuing obligations hereunder. In addition, Purchaser may assign any or all of its rights pursuant to this Agreement to any of its Affiliates or

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## to any lender to Purchaser or any of its Affiliates as collateral security without the consent of Seller, provided that, unless otherwise agreed to by Seller, Purchaser shall remain liable for any continuing obligations hereunder.
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.9 <u>No Third Party Beneficiaries</u>. Nothing in this Agreement will be construed to give any Person other than the Parties to this Agreement any legal or equitable right under or with respect to this Agreement or any provision of this Agreement, except such rights as will inure to a successor or permitted assignee pursuant to <u>Section 7.8</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.10 <u>Governing Law; Venue</u>. This Agreement shall be governed by, and construed in accordance with, the Law of the State of Delaware without regard to any conflicts of law principles that would require the application of any other Law. Each Party agrees to personal jurisdiction in any action brought in any Court, Federal or State, within the State of Delaware having subject matter jurisdiction over the matters arising under this Agreement. Any suit, action or proceeding arising out of or relating to this Agreement shall only be instituted in the State of Delaware. Each Party waives any objection that it may have now or hereafter to the laying of the venue of such action or proceeding and irrevocably submits to the exclusive jurisdiction of any such Court in any such suit, action or Proceeding.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.11 <u>Waiver of Jury Trial</u>. The parties hereby waive any right to trial by jury in any action or proceeding arising out of or in any way pertaining to this Agreement or the transactions, whether now or hereafter arising, and whether sounding in contract, tort, or otherwise. Any party may file a copy of this <u>Section 7.11</u> with any court as written evidence of the knowing, voluntary and bargained agreement between the parties to irrevocably waive trial by jury, and that any proceeding or action whatsoever between the parties relating to this Agreement or the transactions will instead be tried in a court of competent jurisdiction by a judge sitting without a trial.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.12 <u>Execution of Agreement; Counterparts</u>. This Agreement may be executed in one or more counterparts, each of which will be deemed to be an original copy of this Agreement and all of which, when taken together, will be deemed to constitute one and the same agreement. The exchange of copies of this Agreement and of signature pages by facsimile, electronic signature (including via DocuSign) or by .pdf or similar imaging transmission, will constitute effective execution and delivery of this Agreement as to the Parties and may be used in lieu of the original Agreement for all purposes. Signatures of the Parties transmitted by facsimile, electronic signature (including via DocuSign) or by .pdf or similar imaging transmission, will be deemed to be their original signatures for any purpose whatsoever.

*[Signature Pages Follow.]*

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**IN WITNESS WHEREOF**, the undersigned have executed this Agreement as of the date first written above.

**<u>PURCHASER</u>**:

**HERITAGE DEBTX LLC**

By: <u>/s/ James Sklar</u> 

Name: James Sklar

Title: Executive Vice President, General Counsel and Secretary

*Signature Page to Asset Purchase Agreement*

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**IN WITNESS WHEREOF**, the undersigned has executed this Agreement as of the date first written above.

**<u>SELLER</u>:**

**THE DEBT EXCHANGE, INC.** 

By: <u>/s/ William F. Looney III</u> 

Name: William F. Looney III

Title: President & CEO

*Signature Page to Asset Purchase Agreement*

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## Exhibit 10.2

Exhibit 10.2

**EMPLOYMENT AGREEMENT**

**THIS EMPLOYMENT AGREEMENT** (this "<u>Agreement"</u>) is made effective as of January 9, 2026 (the "<u>Effective Date"</u>) by and between Heritage DebtX LLC, a Delaware limited liability company (the "<u>Company</u>"), and Bruce Hounsell ("<u>Executive</u>"). Capitalized terms used but not otherwise defined herein shall have the meaning assigned to such terms in <u>Section 6</u> hereof.

**RECITALS**

**WHEREAS**, Executive is skilled in business and financial matters as they relate to the business of full-service loan sale advisory services; and

**WHEREAS**, in connection with the transactions contemplated by, and as a condition to the execution of, that certain Asset Purchase Agreement (the "<u>Purchase Agreement</u>"), dated as of the date hereof, by and among the Company and The Debt Exchange, Inc., a Delaware corporation ("<u>Seller</u>"), the Company and Executive desire to enter into this Agreement in respect of the engagement and employment of Executive by the Company on the terms and conditions set forth herein, including those covenants set forth in <u>Sections 4</u> and <u>5</u>, effective as of the Effective Date or Employment Start Date, as applicable.

**TERMS**

**NOW, THEREFORE,** the parties hereto agree as follows:

**Section 1.** <u>Employment</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)<u>Consulting Period</u>. The Company hereby engages Executive to perform, provide and render to the Company consulting and advisory services (the "<u>Consulting Services</u>"), including, without limitation, providing assistance related to the operation and management of the Business and rendering such other business and consulting services reasonably specifically requested and authorized by the Chief Executive Officer (the "<u>Chief Executive Officer</u>") of Heritage Global Inc., the ultimate parent company of the Company ("<u>Parent</u>") or such other individual as the Chief Executive Officer may designate from time to time, for the period beginning on the Effective Date and ending on January 26, 2026 (such date, the "<u>Employment Start Date</u>" and such period, the "<u>Consulting Period</u>"). It is expressly acknowledged and agreed that, solely during the Consulting Period, Executive is an "independent contractor" of the Company.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)<u>Employment Period</u>. Beginning on the Employment Start Date, the Company agrees to employ Executive, and Executive accepts such full-time employment, for the period ending upon the earlier of (i) Executive's termination pursuant to <u>Section 2</u> of this Agreement or (ii) the date that is the third (3<sup>rd</sup>) anniversary of the Employment Start Date (such period, the "<u>Initial Employment Period</u>"). At the end of the Initial Employment Period and the end of each Renewal Employment Period (defined below), if applicable, this Agreement shall automatically renew for additional one (1) year periods (each such period, the "<u>Renewal Employment Period</u>"), unless Executive gives notice to the Company, or the Company gives notice to Executive, at least ninety (90) days prior to the expiration of the Employment Period (including any renewal thereof) of such party's desire to terminate the Employment Period. The Initial Employment Period and any Renewal Employment Period(s) is collectively referred to as the "<u>Employment Period</u>."

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)<u>Position and Duties</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;(i)For the period beginning on the Employment Start Date and ending on March 31, 2026 (the "<u>Transition Period</u>"), Executive shall serve as the Co-President of the Company. During the Transition Period, Executive shall perform such activities as are necessary or directed by the Chief

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Executive Officer (or such other individual as the Chief Executive Officer may designate from time to time) to transition Executive from Co-President to President of the Company. Following the Transition Period and for the remainder of the Employment Period, Executive shall serve as President of the Company. Executive shall report to the Chief Executive Officer (or such other individual as the Chief Executive Officer may designate from time to time). Executive shall have the normal duties, responsibilities, and authority implied by such position and shall perform such other activities as are directed by the Chief Executive Officer, subject in each case to the power of the Chief Executive Officer to expand, limit, or otherwise alter such duties, responsibilities, positions, and authority and to otherwise override actions of officers.

&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)Executive shall devote Executive's reasonable best efforts and substantially all of Executive's full business time and attention to the business and affairs of the Company given Executive's title as stated herein, except for permitted vacation periods in accordance with the Company's policy, periods of illness or other incapacity, and reasonable time spent with respect to civic and charitable activities, provided that none of such activities materially interfere with Executive's duties to the Company or its Affiliates or otherwise violate Executive's duty of loyalty to the Company. Executive shall comply with all policies and procedures of the Company and its Affiliates, as applicable and as may be amended by the Company or Affiliates from time to time in the Company or Affiliates' sole discretion, including the Code of Conduct of Parent, as will be delivered to Executive prior to the Effective Date and made available to Executive upon request. Notwithstanding the foregoing, Executive may engage in the following activities ("<u>Permitted Outside Activities</u>") so long as such activities do not interfere with Executive's compliance with the terms and conditions of this Agreement and are not in conflict with the policies or interests of the Company: (A) Executive may serve as a member of the board of directors of Debticate, Inc. ("<u>Debticate</u>"), (B) Executive may continue to serve as a member of the board of directors of The Debt Exchange, Inc. solely to engage in activities reasonably necessary and required to wind down and dissolve the business and operations of Seller, and (C) the Company acknowledges and agrees that the Executive serves as a member of MaisieDog, LLC, a separate and independent business entity, and subject to the terms and conditions set forth in <u>Sections 1(d)(iv)(B)</u> below, the Executive is permitted to provide executive services to MaisieDog LLC, or any successor or affiliate entity controlled by Executive (collectively, "<u>MaisieDog</u>"), necessary for certain activities and operations related to Alpine Tremont LLC or an Affiliate thereof ("<u>Alpine Tremont</u>"). Unless otherwise agreed upon on a case-by-case basis in writing (email being sufficient) between Executive and the Company, such activities and operations shall be limited to entities domiciled outside the United States with borrowers and/or collateral located worldwide, including within the United States, and entities domiciled within the United States regarding assets and/or borrowers located only outside of the United States. Executive's services for MaisieDog shall be performed strictly in a representative capacity as a member of MaisieDog and not in his individual capacity as an employee of Company. The parties acknowledge that Executive's activities described in Sections (ii)(A) and (ii)(B) may involve conflicts of interest. Accordingly, in the event of a conflict of interest involving Company and either of those respective entities, Executive shall report such conflict of interest to Company and recuse himself from any discussions on behalf of Company or any such entity involving such conflict of interest. The parties further agree that the activities described in the preceding clause (C) shall be performed by MaisieDog in exchange for revenue sharing or other consideration pursuant to <u>Section 1(d)(iv)(B)</u> below. MaisieDog shall be solely responsible for its acts and omissions in connection with such activities. Company shall pursue any claim against MaisieDog that arises out of or is related to the business, acts, or omissions of MaisieDog against MaisieDog and not against Executive.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)<u>Salary; Benefits; Bonus; Stock Options</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;(i)*<u>Salary</u>*. During the Employment Period, the Company shall pay Executive an annual base salary at the rate of $400,000 (the "<u>Base Salary</u>"). The Base Salary shall be paid in accordance

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with the regular payroll practices of the Company with respect to executive officers of the Company, subject to applicable withholdings and deductions.

&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)*<u>Benefits</u>*. During the Employment Period, Executive will be entitled to participate in all health and welfare benefit plans and practices maintained by the Company, if any, for its executive employees generally in accordance with the terms of such plans and practices as in effect from time to time, and in any other insurance, health, retirement or welfare benefit plans, programs and practices which the Company generally provides to its executives from time to time; <u>provided</u>, <u>however</u>, that the Company may alter or terminate such benefits or any such aforementioned policies in its sole discretion and in accordance with 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;&nbsp;&nbsp;&nbsp;&nbsp;(iii)*<u>Annual Bonus</u>*. During the Employment Period and commencing with respect to calendar year 2026, Executive shall be eligible for an annual performance bonus, if any (each, an "<u>Annual Bonus</u>"), determined as follows for each Bonus Year (defined below): (A) if the NOI (defined below) for such Bonus Year is equal to or less than $1,500,000, then Executive shall not be eligible to receive a bonus; (B) if the NOI of the Company during such Bonus Year is greater than $1,500,000 but less than $3,000,000, Executive shall be eligible to receive a bonus equal to five percent (5%) of that portion of the NOI of the Company that is greater than $1,500,000 but less than $3,000,000, plus (C) if the NOI of the Company during such Bonus Year is greater than $3,000,000, Executive shall be eligible to receive a bonus equal to ten percent (10%) of that portion of the NOI of the Company that is $3,000,000 or greater. For clarity, the Annual Bonus is not cumulative across any multiple Bonus Years. Each such Annual Bonus, if any, will be paid within ten (10) days after the Chief Executive Officer certifies that the applicable performance metrics and targets for the applicable Bonus Year have been achieved (based upon the audited financial statements of the Company), but in all events in the calendar year following the applicable Bonus Year and following the completion of the Company's financial audit for such Bonus Year. All determinations by the Chief Executive Officer regarding the Annual Bonus shall be binding on all parties hereto. Executive's right to receive an Annual Bonus is contingent on Executive's continued employment through the relevant payment date and approval by the Chief Executive Officer.

&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;(iv)*<u>Engagement with Alpine Tremont and Revenue Sharing</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;&nbsp;&nbsp;&nbsp;&nbsp;(A)*<u>Preferred Path (Company Direct)</u>*. As of the Effective Date, the parties agree that for any transaction involving Alpine Tremont, Executive shall first use commercially reasonable efforts to facilitate a direct contractual relationship between the Company and Alpine Tremont. In the event the Company and Alpine Tremont enter into a direct agreement, the Company shall pay Executive a commission equal to 50% of the revenue actually received by the Company pursuant to such agreement, net of 50% of any related direct, out-of-pocket expenses incurred by the Company ("Company Revenue"). Such payment shall be made to Executive in due course. The Company acknowledges that such commission is earned in consideration of Executive's origination and execution of the transaction.

&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;&nbsp;&nbsp;&nbsp;&nbsp;(B) *<u>The Fallback Path (Professional Services Agreement)</u>*. If Executive is unable to arrange for a direct contract between the Company and Alpine Tremont, or if Alpine Tremont prefers to contract with MaisieDog, the relationship between the Company and MaisieDog shall be governed by a mutually agreed upon Professional Services Agreement. Under the Professional Services Agreement, MaisieDog shall have exclusive control over the manner and means of performance, shall be solely responsible for its own acts and omissions, and shall remit 50% of the revenue actually received from Alpine Tremont to the Company pursuant to MaisieDog's agreement with Alpine Tremont, net of 50% of any related direct, out-of-pocket expenses incurred by MaisieDog. For the avoidance of doubt, any revenues or payments earned or received by MaisieDog pursuant to that certain Back to Back Engagement Agreement between MaisieDog and Alpine Tremont referencing an Engagement Agreement dated September 16, 2025 (the "Excluded Back to Back Engagement Agreement") will not be subject to the

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Professional Services Agreement and MaisieDog may retain all payments earned or received by MaisieDog pursuant to the Excluded Back to Back Engagement 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;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(C) *<u>General</u>*. The authorization for Executive to perform services as Permitted Outside Activities through MaisieDog as well as the Company's obligation to pay the 50% commission under the Preferred Path, shall both terminate at such time as the aggregate total of Company Revenue paid to Executive and net revenue retained by MaisieDog reaches $500,000, exclusive of certain services performed by MaisieDog for Alpine Tremont pursuant solely to the Excluded Back to Back Engagement 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;&nbsp;&nbsp;&nbsp;&nbsp;(v) *<u>Stock Options</u>*. On the Effective Date, upon the execution and delivery of this Agreement and that certain Non-Qualified Stock Option Agreement to be entered into between Parent and Executive on Parent's standard form (the "<u>NQSO Agreement</u>"), Parent shall issue to Executive, and Executive will accept from Parent, 500,000 Stock Options (as defined in the 2022 Heritage Global Inc. Equity Incentive Plan). Such Stock Options shall be subject to certain time-based vesting requirements as set forth in the NQSO Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)<u>Business Expenses</u>. Subject to the Company's established policies and procedures for business expense reimbursement (which may be amended from time to time in the Chief Executive Officer's sole discretion), the Company shall pay or reimburse Executive (at the Company's option) for all reasonable business expenses incurred by Executive in the course of performing Executive's duties and responsibilities under this Agreement, including, but not limited to, for food and lodging accommodations that would reasonably be expected to be incurred for a similarly situated executive traveling on behalf of the Company.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f)<u>Workplace and Work Schedule</u>. Executive shall primarily work remotely from his home in Boston, Massachusetts; provided that if the Company from time to time establishes an office in the Greater Boston metropolitan area, Executive shall work primarily from such office. Executive may be expected to travel regularly in the course and scope of Executive's employment. Executive is entitled to such holidays as are established by Company's policies.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g)<u>Vacation</u>. Executive is entitled to five (5) weeks of paid vacation each year (which shall be prorated for any partial years during the Employment Period) during the Employment Period at a rate of Executive's then applicable Base Salary (prorated for the period of vacation). Scheduling of Executive's vacation is subject to Company's reasonable needs. Accrual and carryover of vacation time shall be governed by the Company's applicable policies in effect from time to time, subject to Massachusetts law. Accrued and unused paid time off will be paid out to Executive upon separation of employment.

**Section 2.** <u>Termination of Employment</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)<u>Death or Disability</u>. Executive's employment hereunder shall automatically terminate in the event of Executive's death during the Employment Period. The Company may terminate Executive's employment, upon notice to Executive, in the event that Executive becomes disabled during Executive's employment hereunder through any illness, injury, accident or condition of either a physical or psychological nature and, as a result, is unable to perform substantially all of Executive's duties and responsibilities hereunder (notwithstanding the provision of any reasonable accommodation) for a period of ninety (90) consecutive days or any one hundred twenty (120) days during any period of three hundred sixty-five (365) consecutive days. If any question shall arise as to whether Executive is disabled to the extent that Executive is unable to perform substantially all of Executive's duties and responsibilities for the Company Group, Executive shall, at the Company's request, submit to a medical examination by a physician selected by the Company to whom Executive or Executive's guardian, if any, has no reasonable

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objection to determine whether Executive is so disabled, and such determination shall for purposes of this Agreement be conclusive of the issue. If such a question arises and Executive fails to submit to the requested medical examination, the Chief Executive Officer's good faith determination of the issue shall be binding on Executive.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)<u>By the Company for Cause</u>. The Company may terminate Executive's employment for Cause upon notice to Executive setting forth in reasonable detail the nature of the Cause. In addition, and notwithstanding the foregoing, in the event that the Chief Executive Officer reasonably believes that Executive may have engaged in conduct that could constitute Cause hereunder, the Chief Executive Officer may, in its sole and absolute discretion, suspend Executive from performing Executive's duties and responsibilities.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)<u>By the Company without Cause</u>. The Company may terminate Executive's employment at any time other than for Cause upon ninety (90) days' notice to Executive; provided, however, that the Company may, in its sole discretion, accelerate the effective date of termination pursuant to this Section 2(c) so long as the Company pays to Executive the accrued, unpaid salary and benefits for the entire period between the date the termination notice was given and the effective date of termination. A non-renewal of the Employment Period in accordance with <u>Section 1</u> is not a termination by the Company without Cause.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)<u>By Executive Without Good Reason.</u> Executive may terminate Executive's employment at any time without Good Reason upon ninety (90) days' notice to the Company. The Company may elect to waive such notice period or any portion thereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)<u>By Executive for Good Reason</u>. Executive may terminate Executive's employment for Good Reason after required notice to the Company setting forth in reasonable detail the nature of the Good Reason, once the applicable cure period (as contemplated by the definition of Good Reason) has lapsed if the Company has not then cured the circumstances that gave rise to the basis for the Good Reason termination. A non-renewal of the Employment Period in accordance with <u>Section 1</u> shall not constitute Good Reason.

**Section 3.** **<u>Other Matters Related to Termination</u>.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)<u>Final Compensation</u>. In the event of termination of Executive's employment with the Company, howsoever occurring, the Company shall pay Executive (i) the portion of the Base Salary for the final payroll period of Executive's employment, through the date Executive's employment terminates, and (ii) a prorated portion of any Annual Bonus Executive would otherwise be entitled to under <u>Section 1(c)(iii)</u> as of the date of termination, determined in good faith by Company consistent with past practice and payable promptly following such determination, (iii) reimbursement, in accordance with <u>Section 1(d)</u> hereof, for business expenses incurred by Executive but not yet paid to Executive as of the date Executive's employment terminates, provided that Executive submits all expenses and supporting documentation required within thirty (30) days of the date Executive's employment terminates, and provided further that such expenses are reimbursable under Company policies then in effect, and (iv) accrued and unused vacation time as of the date of termination (all of the foregoing, "<u>Final Compensation</u>"). Except as otherwise provided in <u>Section</u> <u>3(a)(ii)</u> <u>and (iii)</u> hereof, Final Compensation will be paid to Executive within thirty (30) days following the date of termination or such shorter period required by law.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)<u>Severance Payments</u>. In the event of any termination of Executive's employment pursuant to <u>Section 2(c)</u> or <u>Section 2(e)</u> above, the Company will pay Executive, in addition to Final Compensation, an amount equal to the Base Salary (the "<u>Severance Payments</u>").

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)<u>Conditions To And Timing Of Severance Payments</u>. Any obligation of the Company to provide Executive the Severance Payments is conditioned on Executive's signing and returning, without revoking, to the Company a timely and effective separation agreement containing a general release of claims in form and substance reasonably satisfactory to the Company (the "<u>Separation Agreement</u>"). The Separation Agreement must become effective, if at all, by the sixtieth (60th) calendar day following the date Executive's employment terminates. Any Severance Payments to which Executive is entitled will be payable in the form of salary continuation in accordance with the normal payroll practices of the Company. The first such payment will be made on the Company's next regular payday following the expiration of sixty (60) calendar days from the date that Executive's employment terminates, but will be retroactive to the day following such date of termination.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)<u>Benefits Termination</u>. Except for any right Executive may have under the federal law known as "COBRA" or other applicable law to continue participation in the Company's group health and dental plans at Executive's cost, Executive's participation in all employee benefit plans shall terminate in accordance with the terms of the applicable benefit plans based on the date of termination of Executive's employment, without regard to any continuation of the Base Salary or other payment to Executive following termination of Executive's employment, and Executive shall not be eligible to earn vacation or other paid time off following the termination of Executive's employment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)<u>Survival</u>. Provisions of this Agreement shall survive expiration of the term of the Agreement or any termination of employment if so provided in this Agreement or if necessary or desirable to accomplish the purposes of other surviving provisions, including without limitation Executive's obligations under <u>Sections 4</u> and <u>5</u> of this Agreement. The obligation of the Company to make payments to Executive under <u>Section 3(b)</u>, and Executive's right to retain the same, are expressly conditioned upon Executive's continued full performance of Executive's obligations under <u>Sections 4</u> and <u>5</u> of this Agreement and with respect to any other Restrictive Covenants. Upon expiration of the term of the Agreement or termination by either Executive or the Company, all rights, duties and obligations of Executive and the Company to each other hereunder shall cease, except as otherwise expressly provided in this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f)<u>Code Section 409A</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;(i)The intent of the parties is that payments and benefits under this Agreement comply with or otherwise be exempt from Section 409A of the Internal Revenue Code of 1986, as amended (the "<u>Code</u>"), and the regulations and guidance promulgated thereunder (collectively "<u>Code Section 409A</u>") and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted to be either exempt from or in compliance therewith. In no event whatsoever shall the Company be liable for any additional tax, interest or penalty that may be imposed on Executive by Code Section 409A or damages for failing to comply with Code Section 409A.

&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)Notwithstanding any other payment schedule provided herein to the contrary, if Executive is deemed on the date of termination to be a "specified employee" within the meaning of that term under Code Section 409A(a)(2)(B) and Treasury Regulations Section 1.409A-1(i), then any payment under this Agreement that is considered deferred compensation under Code Section 409A payable on account of a "separation from service" shall not be made until the date which is the earlier of (A) the first date after the date of expiration of the six (6) month period measured from the date of such "separation from service" of Executive, and (B) the date of Executive's death (the "<u>Delay Period</u>") to the extent required under Code Section 409A. Within ten (10) days following the expiration of the Delay Period, all payments delayed pursuant to this <u>Section 3(f)</u> shall be paid to Executive in a lump sum, and all remaining payments due under this Agreement shall be paid or provided in accordance with the normal payment dates specified for them herein.

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&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)A termination of employment shall not be deemed to have occurred for purposes of any provision of this Agreement providing for the payment of any amounts or benefits upon or following a termination of employment (but only to the extent such amounts or benefits are subject to the provisions of Code Section 409A) unless such termination is also a "separation from service" from the Company within the meaning of Code Section 409A and Treasury Regulations Section 1.409A-1(h) and, for purposes of any such provision of this Agreement, references to a "termination," "termination of employment" or like terms shall mean "separation from service."

&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;(iv)For purposes of Code Section 409A, Executive's right to receive any installment payment pursuant to this Agreement shall be treated as a right to receive a series of separate and distinct payments.

&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;(v)Notwithstanding any other provision to the contrary, in no event shall any payment under this Agreement that constitutes "deferred compensation" for purposes of Code Section 409A be subject to offset by any other amount unless otherwise permitted by Code Section 409A. For the avoidance of doubt, any payment due under this Agreement within a period following Executive's termination of employment or other event, shall be made on a date during such period as determined by the Company in its sole discretion, and in accordance with Code Section 409A.

&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;(vi)With regard to any provision herein that provides for reimbursement of costs and expenses or in kind benefits, except as permitted by Code Section 409A, (A) the right to reimbursement or in kind benefits shall not be subject to liquidation or exchange for another benefit, (B) the amount of expenses eligible for reimbursement, or in kind benefits, provided during any taxable year shall not affect the expenses eligible for reimbursement, or in kind benefits to be provided, in any other taxable year, and (C) such payments shall be made on or before the last day of Executive's taxable year following the taxable year in which the expense occurred, all in accordance with Treasury Regulations Section 1.409A-3(i)(1)(iv).

**Section 4.** **<u>Confidential Information</u>.** Without limiting Executive's obligations under any other agreement with the Company Group:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)<u>Obligation to Maintain Confidentiality</u>. Executive acknowledges that the information, observations and data (including Work Product, trade secrets and information concerning expansion or acquisition opportunities in or reasonably related to the Company Group's or its Affiliates' Business or industry) obtained by Executive or of which Executive becomes aware during the course of Executive's employment with the Company (or prior to the start thereof) concerning the business or affairs of the Company Group or its Affiliates ("<u>Confidential Information</u>") are the property of the Company Group. Therefore, Executive agrees that Executive will not disclose to any unauthorized Person or use for Executive's own account any Confidential Information without the Chief Executive Officer's written consent, unless and only to the extent that the Confidential Information (i) becomes generally known to and available for use by the public other than as a result of Executive's acts or omissions to act in violation hereof or as a result of any breach of any agreement with the Company, (ii) is required to be disclosed pursuant to any applicable law or court order, (iii) becomes available to Executive on a non-confidential basis following Executive's termination pursuant to <u>Section 2</u> of this Agreement from a source other than the Company Group or its agents, provided that such source lawfully obtained such information and is not bound by a confidentiality obligation not to disclose such information, or (iv) is approved by the Chief Executive Officer in writing for disclosure. Executive shall take reasonable steps to safeguard Confidential Information and to protect it against disclosure, misuse, espionage, loss and theft. Executive shall deliver to the Company Group upon Executive's termination pursuant to Section 2 of this Agreement, or at any other time the Company Group may request, all memoranda, notes, plans, records, reports, computer tapes, printouts and software and other documents and data (and copies thereof) relating to the Confidential

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Information, Work Product (as defined below) or the business of the Company Group (including, without limitation, all acquisition prospects, lists and contact information) which Executive may then possess or have under Executive's control. For the avoidance of doubt, (i) nothing contained in this Agreement limits, restricts or in any other way affects Executive's communicating with any governmental agency or entity concerning matters relevant to such governmental agency or entity, or requires Executive to furnish notice to the Company Group of the same, and (ii) Executive will not be held criminally or civilly liable under any federal or state trade secret law for disclosing a trade secret (y) in confidence to a federal, state or local government official, either directly or indirectly, or to an attorney, solely for the purpose of reporting or investigating a suspected violation of law, or (z) in a complaint or other document filed under seal in a lawsuit or other proceeding; provided, however, that notwithstanding this immunity from liability, Executive may be held liable if Executive unlawfully accesses trade secrets by unauthorized means. Nothing in this Agreement, any other agreement with the Company, or in any Company policy or program, limits or interferes with Executive's right to report possible violations of law or regulation to, file a charge or complaint with, communicate with, or otherwise participate in any investigation or proceeding conducted by any governmental agency or entity, including the Securities and Exchange Commission (SEC), the Equal Employment Opportunity Commission (EEOC), the Department of Labor (DOL), the Department of Justice (DOJ), or any other federal, state, or local regulator. Executive may make such reports or communications and provide documents or other information, without notice to or authorization from the Company.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)<u>Ownership of Property</u>. Executive acknowledges that all discoveries, concepts, ideas, inventions, innovations, improvements, developments, methods, processes, programs, designs, permit applications, analyses, drawings, reports, patent applications, copyrightable work and mask work (whether or not including any Confidential Information), any other intellectual property or proprietary right in any jurisdiction throughout the world, the right to sue third parties for past, present, and future infringement of or improper activities, and all registrations or applications related thereto, all other proprietary information and all similar or related information (whether or not patentable) that relate to any member of the Company Group's actual or anticipated business, research and development, or existing or future products or services and that are conceived, developed, contributed to, made, or reduced to practice by Executive (either solely or jointly with others) while employed by any member of the Company Group (including any of the foregoing that constitutes any proprietary information or records) (collectively, "<u>Work Product</u>"), belong to the Company Group, and Executive hereby assigns, and agrees to assign, all of the above Work Product to the applicable member of the Company Group. Executive shall promptly disclose such Work Product to the Company Group and perform all actions reasonably requested by the Company Group (whether during or after the Employment Period) to establish and confirm such member of the Company Group's ownership (including, without limitation, assignments, consents, powers of attorney, and other instruments). To the extent Executive created or developed any Work Product prior to the Effective Date, then in consideration for Executive's continued employment, the sufficiency of which is hereby acknowledged by Executive, Executive hereby assigns, transfers, and sets over to the Company Group all rights, title, and interests in and to all Work Product made, caused to be made, conceived, implemented, or reduced to practice, in whole or in part, whether alone or acting with others, by Executive on behalf of the Company Group prior to the Effective Date. To the extent allowed by law, the provisions of this <u>Section 4(b)</u> shall apply to all rights of paternity, integrity, disclosure, and withdrawal, and any other rights generally known as or referred to as "moral rights," "artist's rights," "droit moral," "author's special rights," or the like in or to all Work Product (collectively, "<u>Moral Rights</u>"). To the extent Executive retains any Moral Rights under applicable law, Executive hereby waives, ratifies, and consents to any action that may be taken or authorized by the Company Group with respect to such Moral Rights, and Executive agrees not to assert Moral Rights with respect to such action.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)<u>Third-Party Information</u>. Executive understands that the Company Group will receive from third parties confidential or proprietary information ("<u>Third-Party Information</u>") subject to a duty on the Company Group's part to maintain the confidentiality of such information and to use it only for certain

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limited purposes. During the Employment Period and thereafter, and without in any way limiting the provisions of <u>Section 4(a)</u> above, Executive will hold Third-Party Information in the strictest confidence and will not disclose to anyone (other than personnel and consultants of the Company Group who need to know such information in connection with their work for the Company Group) or use, except in connection with Executive's work for the Company Group, Third-Party Information, unless expressly authorized by the Chief Executive Officer in writing.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)<u>Use of Information of Prior Employers</u>. During the Employment Period, Executive will not improperly use or disclose any Confidential Information or trade secrets, if any, of any former employers (other than Seller, which information the Company is acquiring pursuant to the Purchase Agreement) or any other Person to whom Executive has an obligation of confidentiality, and will not bring onto the premises of the Company Group any unpublished documents or any property belonging to any former employer (other than Seller) or any other Person to whom Executive has an obligation of confidentiality, unless consented to in writing by the former employer or Person. Executive will use in the performance of Executive's duties only information which is (i) generally known and used by persons with training and experience comparable to Executive's and which is (A) common knowledge in the industry or (B) is otherwise legally in the public domain, (ii) is otherwise provided or developed by the Company Group or (iii) in the case of materials, property or information belonging to any former employer (other than Seller) or other Person to whom Executive has an obligation of confidentiality, approved for such use in writing by such former employer or Person.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)<u>Survival</u>. The obligations contained in this <u>Section 4</u> shall survive the termination of Executive's employment with or service to the Company Group and shall be fully enforceable thereafter in accordance with the terms hereof.

**Section 5.** **<u>Restrictive Covenants</u>.** Executive acknowledges that, in the course of Executive's employment with the Company, Executive will become familiar with the Company Group's trade secrets and with other Confidential Information (as defined herein) concerning the Company Group and that Executive's services will be of special, unique and extraordinary value to the Company Group. Therefore, without limiting any other obligation Executive may have pursuant to this Agreement, Executive agrees that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)<u>Non-competition</u>. During the Restricted Period, Executive shall not directly or indirectly own, manage, control, participate in, consult with, render services for, advise any Person with respect to the acquisition of or in any manner engage in any business which is or plans to be engaged in the Business of the Company Group or otherwise competes or plans to compete with the Business of the Company Group anywhere in the Restricted Territory; provided, however, that the restrictions of this Section 5(a) shall not apply after the end of Executive's employment if he is laid off or terminated without Cause. Nothing herein shall prohibit Executive from being a passive owner of not more than 5% of the outstanding stock of any class of a corporation that is publicly traded, so long as Executive has no active participation in the business of such corporation. Executive acknowledges that the restrictions of this Section 5(a) are adequately supported by consideration, including Executive's access to the Company Group's Confidential Information and trade secrets.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)<u>Non-solicitation</u>. During the Restricted Period, Executive shall not directly or indirectly (i) solicit from any customer, manufacturer, supplier, vendor, licensee or other business relation of the Company Group business that is the same as or similar to the products or services utilized by the Company Group from such customer, manufacturer, supplier, vendor, licensee or other business relation; (ii) hire, recruit, or solicit the employment or services of, or attempt to hire, recruit, or solicit the employment or services of, any Person who was employed by any member of the Company Group at the date of Executive's termination pursuant to <u>Section 2</u> of this Agreement or the twelve (12) months before such date; (iii) induce

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or attempt to induce any customer, manufacturer, supplier, vendor, licensee or other business relation of the Company Group to cease doing business with the Company Group, in any way interfere with the relationship between any such customer, manufacturer, supplier, vendor, licensee or business relation and the Company Group, or solicit the business of any such customer, manufacturer, supplier, vendor, licensee or other business relation; or (iv) acquire or attempt to acquire an interest in any business relating to the Business of the Company Group and with which any member of the Company Group has entertained discussions or has requested and received information relating to the acquisition of such business by the Company Group within the one year period immediately preceding Executive's termination pursuant to <u>Section 2</u> of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)<u>Non-disparagement</u>. During the Employment Period and thereafter, Executive shall refrain from directly or indirectly making any public statement that is intended to or could reasonably be expected to disparage any member of the Company Group or its Affiliates or any of their respective products, services, brands, owners, managers, directors, officers or employees.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)<u>Enforcement</u>. If, at the time of enforcement of <u>Section 4</u> or this <u>Section 5</u>, a court holds that the restrictions stated herein are unreasonable under circumstances then existing, the parties hereto agree that the maximum duration, scope or geographical area reasonable under such circumstances shall be substituted for the stated period, scope or area and that the court shall revise, and shall thereafter enforce, the restrictions contained herein to cover the maximum duration, scope and area permitted by applicable law. Because Executive's services are unique and because Executive has access to Confidential Information, the parties hereto agree that the Company would be irreparably harmed by, and money damages would be an inadequate remedy for, any breach of <u>Section 4</u> or this <u>Section 5</u>. Therefore, in the event of a breach or threatened breach of this Agreement, the Company Group and its successors and assigns may, in addition to any other rights and remedies existing in their favor at law or in equity, obtain from any court of competent jurisdiction specific performance and/or injunctive or other equitable relief in order to enforce, or prevent any violations of, the provisions hereof, in all cases, without posting a bond or other security. It is also agreed that each member of the Company Group will have the right to enforce all of Executive's obligations to that subsidiary or Affiliate under this Agreement, including, without limitation, pursuant to this <u>Section 5</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)<u>Reasonableness of Covenants</u>. In signing this Agreement, Executive acknowledges that Executive has carefully read and considered all of the terms and conditions of this Agreement, including the restraints imposed under <u>Section 4</u> and this <u>Section 5</u>, and Executive has consulted with legal counsel of Executive's choosing regarding this Agreement's contents. Executive agrees that these restraints are necessary for the reasonable and proper protection of the Company Group and its Confidential Information and that each and every one of the restraints is reasonable in terms of subject matter, length of time and geographic area, and that these restraints, individually or in the aggregate, will not prevent Executive from obtaining other suitable employment during the period in which Executive is bound by the restraints. Executive acknowledges that each of the covenants in <u>Section 4</u> and this <u>Section 5</u> has a unique, very substantial and immeasurable value to the Company Group and that Executive has sufficient assets and skills to maintain a livelihood while such covenants remain in force. Executive further covenants that Executive will not challenge the reasonableness or enforceability of any of the covenants set forth in <u>Section 4</u> or this <u>Section 5</u> and that Executive will reimburse the Company Group for all costs (including reasonable attorneys' fees) incurred in connection with any action to enforce any of the provisions of <u>Section 4</u> or this <u>Section 5</u> if the Company Group prevails on any material issue involved in such dispute or if Executive fails to prevail in any challenge to the reasonableness or enforceability of any of the provisions of <u>Section 4</u> or this <u>Section 5</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f)<u>Tolling</u>. In the event of any violation of the provisions of this <u>Section 5</u>, Executive acknowledges and agrees that the period(s) during which Executive shall be bound by the restrictions

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contained in this <u>Section 5</u> shall be extended by a period of time equal to the duration of such violation, it being the intention of the parties hereto that the running of the applicable period(s) during which Executive shall be bound by the restrictions contained in this <u>Section 5</u> shall be tolled for the duration of such violation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g)<u>Survival</u>. The obligations contained in this <u>Section 5</u> shall survive the termination of Executive's employment with or service to the Company Group and shall be fully enforceable thereafter in accordance with the terms hereof.

**Section 6.** **<u>Definitions</u>.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)"<u>Affiliate</u>" means with respect to any Person (a) who is an individual, the spouse, parent, sibling or lineal descendent of such Person, (b) that is an entity, any Person which, directly or indirectly, controls, is controlled by, or is under common control with such Person, and (c) that is an entity, any Person who is a director, officer, manager, member, partner, principal or employee of such Person or of any other Person which directly or indirectly controls, is controlled by, or is under common control with such Person. For purposes of this definition, "control" of a Person shall mean the power, direct or indirect, to direct or cause the direction of the management and policies of such Person whether by ownership of voting securities, by contract or otherwise.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)"<u>Bonus Year</u>" means, with respect to determining Executive's Annual Bonus, each complete calendar year Executive is employed by the Company after the Employment Start Date (for the avoidance of doubt, beginning with calendar year 2026, assuming Executive remains employed through the end of 2026).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)"<u>Business</u>" means (a) the business of full service loan sale advisory services, and (b) any other businesses in which the Company Group is engaged in, or planned business for which the Company Group has taken affirmative steps to implement, engage in, launch or pursue, as of the applicable time of determination, provided that Executive has actual knowledge of such affirmative steps or plans. For the avoidance of doubt, the Business shall not be deemed to include developing and selling Software-as-a-Service platforms for loan syndication and whole loan sales, and secure documentation sharing (the current business conducted by Debticate).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)"<u>Company Group</u>" means, collectively, the Company and Parent and each of its subsidiaries, regardless of whether such subsidiary is wholly owned or non-wholly owned.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)"<u>Cause</u>" means: (i) Executive's material breach of this Agreement or any Company Group policies or procedures; (ii) the commission of an act of gross negligence, willful misconduct, dishonesty, fraud, theft or embezzlement on the part of Executive with respect to Executive's duties or otherwise to any member of the Company Group or its business relations; (iii) the breach of any fiduciary duty to any member of the Company Group or its owners; (iv) the commission of any act constituting employment discrimination or sexual harassment; (v) the conviction of Executive, or a plea of nolo contendere by Executive, to any felony or any crime involving moral turpitude, other than a traffic violation or similar offense; (vi) any act or omission by Executive that would reasonably be expected to cause financial, reputational or business harm to the Company or any member of the Company Group; (vii) Executive's failure to cooperate in any audit or investigation of the business or financial practices of the Company or any other member of the Company Group; (viii) Executive's willful failure or refusal to perform Executive's obligations pursuant to this Agreement or the lawful orders of the Chief Executive Officer, or Executive's persistent neglect of Executive's duties or chronic unapproved absenteeism; (ix) Executive's use of illegal substances in the workplace or habitual substance abuse, or Executive's engagement in other conduct that would reasonably be expected to bring any member of the Company Group into public disgrace or disrepute; (x) the commission by Executive of any action, regardless of whether such action was taken

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before or after the Effective Date, in any state that would cause the applicable regulatory authorities of such state or any state in which the Company Group does business to deny, revoke, restrict, suspend, make subject to terms of probation, or adversely restrict in any way the terms of any license or permit held by the Company Group or any application therefor; or (xi) the breach by Executive of any confidentiality, invention assignment, non-competition, non-solicitation, no-hire, non-disparagement or other restrictive covenant obligation set forth in any written agreement with any member of the Company Group (collectively, "<u>Restrictive Covenants</u>"); <u>provided</u> that, prior to any termination for Cause, the Company shall have provided Executive written notice of the particular circumstances and the clause or clauses that are the basis for Cause and, in the case of each of the foregoing clauses (vii), (viii) and (xi), Executive shall have had a period of thirty (30) days to cure the circumstances that are the basis for Cause.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f)"<u>Good Reason</u>" means: (i) a material diminution in Executive's Base Salary; (ii) a material diminution in, or the assignment to Executive of duties or responsibilities that are materially inconsistent with, Executive's title, status, authority, duties or responsibilities, in each case without Executive's approval; or (iii) the Company's material breach of this Agreement; <u>provided</u>, <u>however</u>, that any such condition or conditions, as applicable, shall not constitute Good Reason unless both (x) Executive provides written notice to the Company of the condition claimed to constitute Good Reason within ninety (90) days after the initial existence of such condition(s), and (y) the Company fails to remedy such condition(s) within thirty (30) days of receiving such written notice thereof; and provided, further, that in all events the termination of Executive's employment with the Company shall not constitute a termination for Good Reason unless such termination occurs not more than one hundred and twenty (120) days following the initial existence of the condition claimed to constitute Good Reason.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g)"<u>NOI</u>" means an amount equal to: (i) the amount of revenue recognized by the Company for the applicable Bonus Year, minus (ii) all expenses recognized by the Company for the applicable Bonus Year, each for the foregoing as determined by Company in its reasonable discretion in accordance with the accounting methods, policies, practices and procedures, including classification and estimation methodology, as used by the Company in the preparation of the audited financial statements of the Company, minus (iii) an allocation of Parent's overall corporate overhead and any expenses incurred by parent in connection with the business of the Company, as determined in good faith by Parent consistent with its past practice.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h)"<u>Person</u>" means an individual, a partnership, a limited liability company, a corporation, an association, a joint stock company, a trust, a joint venture, an unincorporated organization, a governmental entity (or any department, agency or political subdivision thereof), or any other legal entity.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)"<u>Restricted Period</u>" means the duration of the Employment Period and throughout the twelve (12) month period immediately following the Employment Period.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j)"<u>Restricted Territory</u>" means (a) any state in which any member of the Company Group operates or engages in the Business as of the Executive's last date of employment, and (b) any state in which any member of the Company Group provides products or services related to the Business at any time during the last twelve (12) months of Executive's employment.

**Section 7.** **<u>Notices</u>.** All notices and other communications required or permitted under this Agreement (i) must be in writing, (ii) will be duly given (A) when delivered personally to the recipient, (B) upon delivery by electronic email on a business day at or prior to 5:00 pm, or otherwise at 8:00 am on the following business day or (C) one (1) business day after being sent to the recipient by nationally recognized overnight private carrier (charges prepaid) and (iii) must be addressed as follows (as applicable) (or at such other address or email address for a party as shall be specified by notice given in accordance with this <u>Section 7</u>):

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If to Company:

Heritage DebtX LLC

c/o Heritage Global Inc.

6130 Nancy Ridge Drive

San Diego, CA 92121

Attention: James Sklar, EVP and General Counsel

E-mail [Reserved]

If to Executive:

Bruce Hounsell<br>[Reserved]<br>[Reserved]

or such other address or to the attention of such other person as the recipient party shall have specified by prior written notice to the sending party. Any notice under this Agreement will be deemed to have been given when so delivered or sent or, if mailed, one day after deposit in the U.S. or Canadian mail.

**Section 8.** **<u>General Provisions</u>.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)<u>Severability</u>. In case any one or more of the provisions contained in this Agreement is for any reason held to be invalid, illegal or unenforceable in any respect, such invalidity, illegality, or unenforceability shall not affect any other provision of this Agreement, and such invalid, illegal, or unenforceable provision shall be reformed and construed so that it will be valid, legal, and enforceable to the maximum extent permitted by law.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)<u>Complete Agreement</u>. This Agreement (including any schedules and exhibits hereto) constitutes the full and entire understanding and agreement among the parties with respect to the subject matter hereof, and any other written or oral agreement relating to the subject matter hereof existing between the parties (or any of their Affiliates) is expressly superseded and canceled.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)<u>Counterparts; Electronic Transmission.</u> This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. This Agreement may also be executed and delivered by facsimile or electronic signature or electronic mail. At the request of any party hereto or to any such agreement or instrument, each other party hereto or thereto shall re-execute original forms thereof and deliver them to all other parties. No party hereto or to any such agreement or instrument shall raise the use of a facsimile machine or electronic mail to deliver a signature or the fact that any signature (electronic or otherwise) or agreement or instrument was transmitted or communicated through the use of a facsimile machine or electronic mail as a defense to the formation or enforceability of a contract and each such party forever waives any such defense.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)<u>Successors and Assigns</u>. Except as otherwise provided herein, this Agreement shall bind and inure to the benefit of and be enforceable by Executive, the Company Group and their respective successors and permitted assigns; provided that the rights and obligations of Executive under this Agreement shall not be assigned or delegated.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)<u>Governing Law</u>. This Agreement, and any dispute, controversy or claim arising out of or relating to this Agreement or a breach hereof, shall be governed by and construed in accordance with the laws of the Commonwealth of Massachusetts without regard for any conflict of laws principles of such State. Each party agrees that a final judgment in any such claim brought in any such court shall be

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conclusive and binding upon such party and may be enforced in any other court the jurisdiction to which such party is or may be subject, by suit upon such judgment. All claims arising under Section 5(a) of this Agreement shall be brought exclusively in the state or federal courts with jurisdiction over the county in which Executive resides or, if mutually agreed by the parties, in the Suffolk County, Massachusetts.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f)<u>Waiver of Jury Trial</u>. EACH PARTY IRREVOCABLY WAIVES ANY AND ALL RIGHTS IT MAY HAVE TO DEMAND THAT ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATED TO THIS AGREEMENT BE TRIED BY JURY. EACH PARTY KNOWINGLY AND VOLUNTARILY WAIVES ITS RIGHT TO DEMAND TRIAL BY JURY.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g)<u>Executive's Cooperation</u>. During the Employment Period and any period during which Executive is receiving Severance Payments pursuant to <u>Section 3(b)</u> of this Agreement, and for a reasonable time thereafter, Executive shall cooperate with the Company Group in any disputes with third parties, internal investigations or administrative, regulatory or judicial proceedings as reasonably requested by the Company Group (including, without limitation, Executive being available to the Company Group upon reasonable notice during normal business hours for interviews and factual investigations, appearing at the Company Group's request to give testimony without requiring service of a subpoena or other legal process, volunteering to the Company Group all pertinent information and turning over to the Company Group all relevant documents which are or may come into Executive's possession, all at times and on schedules that are reasonably consistent with Executive's other permitted activities and commitments). In the event the Company Group requires Executive's cooperation in accordance with this paragraph after the Employment Period, the Company shall reimburse Executive for reasonable travel and other out-of-pocket expenses upon submission of receipts.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h)<u>Amendment and Waiver</u>. The provisions of this Agreement may be amended and/or waived only with the prior written consent of the Company and Executive.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)<u>Independent Legal Advice</u>. Executive acknowledges that he has had the opportunity to seek independent legal and tax advice in Executive's review of this Agreement, and that he has not relied on any statements by the Company or its Affiliates, or their legal counsel with regard to the same. Executive acknowledges that he has been given at least ten (10) days to review this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j)<u>Remedies</u>. Each of the parties to this Agreement will be entitled to enforce its rights under this Agreement specifically, to recover damages and costs (including attorney's fees) caused by any breach of any provision of this Agreement and to exercise all other rights existing in its favor. The parties hereto agree and acknowledge that money damages may not be an adequate remedy for any breach of the provisions of this Agreement and that any party may in its sole discretion apply to any court of law or equity of competent jurisdiction (without posting any bond or deposit) for specific performance and/or other injunctive relief in order to enforce or prevent any violations of the provisions of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(k)<u>No Strict Construction</u>. The language used in this Agreement shall be deemed to be the language chosen by the parties to express their mutual intent, and no rule of strict construction shall be applied against any party hereto

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(l)<u>Insurance</u>. The Company, at its discretion, may apply for and procure in its own name and for its own benefit life and/or disability insurance on Executive in any amount or amounts considered available. Executive agrees to cooperate in any medical or other examination, supply any information, and to execute and deliver any applications or other instruments in writing as may be reasonably necessary to obtain and constitute such insurance.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(m)<u>Business Days</u>. If any time period for giving notice or taking action hereunder expires on a day which is a Saturday, Sunday or holiday in the State of Massachusetts, the time period shall be automatically extended to the business day immediately following such Saturday, Sunday or holiday.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(n)<u>Indemnification and Reimbursement of Payments on Behalf of Executive</u>. The Company Group shall be entitled to deduct or withhold from any amounts owing from the Company Group to Executive any federal, state, local or foreign withholding taxes, excise taxes, or employment taxes ("<u>Taxes</u>") imposed with respect to Executive's compensation or other payments from the Company Group, including, without limitation, wages, bonuses, and distributions. In the event any such deductions or withholdings are not made, Executive shall indemnify the Company Group for any amounts paid with respect to any such Taxes, together with any interest, penalties and related expenses thereto.

\* \* \* \*

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**IN WITNESS WHEREOF**, the parties hereto have executed this Employment Agreement as of the Effective Date.

**<u>COMPANY</u>:**

**HERITAGE DEBTX LLC**

By: <u>/s/ James Sklar</u> 

Name: James Sklar

Title: Executive Vice President, General Counsel and Secretary

*Signature Page of Employment Agreement*

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**IN WITNESS WHEREOF**, the parties hereto have executed this Employment Agreement as of the Effective Date.

**<u>EXECUTIVE</u>:**

<u>/s/ Bruce Hounsell</u> 

**BRUCE HOUNSELL**

*Signature Page of Employment Agreement*

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## Exhibit 31.1

**Exhibit 31.1**

**OFFICER'S CERTIFICATION PURSUANT TO**

**SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002**

I, Ross Dove, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Heritage Global Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c)Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d)Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: May 7, 2026

---

| | |
|:---|:---|
| By: | /s/ Ross Dove |
|  | Ross Dove |
|  | Chief Executive Officer<br>(Principal Executive Officer) |

---

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## Exhibit 31.2

**Exhibit 31.2**

**OFFICER'S CERTIFICATION PURSUANT TO<br>SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002**

I, Brian J. Cobb, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Heritage Global Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c)Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d)Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: May 7, 2026

---

| | |
|:---|:---|
| By: | /s/ Brian J. Cobb |
|  | Brian J. Cobb |
|  | Chief Financial Officer<br>(Principal Financial Officer and Principal Accounting Officer) |

---

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## Exhibit 32.1

**Exhibit 32.1**

**HERITAGE GLOBAL INC.**

OFFICER'S CERTIFICATION<br>PURSUANT TO<br>SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002<br>(18 U.S.C. 1350)

The undersigned Ross Dove, duly appointed and incumbent officer of Heritage Global Inc., a Florida corporation (the "Corporation"), in connection with the Corporation's Quarterly Report on Form 10-Q for the period ended March 31, 2026, as filed with the Securities and Exchange Commission on the date hereof (the "Report"), does hereby represent, warrant and certify pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, as amended, that, to the best of his knowledge:

1. The Report is in full compliance with reporting requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Corporation.

May 7, 2026

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|:---|
| /s/ Ross Dove |
| Ross Dove |
| Chief Executive Officer<br>(Principal Executive Officer) |

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## Exhibit 32.2

**Exhibit 32.2**

**HERITAGE GLOBAL INC.**

OFFICER'S CERTIFICATION<br>PURSUANT TO<br>SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002<br>(18 U.S.C. 1350)

The undersigned Brian J. Cobb, duly appointed and incumbent officer of Heritage Global Inc., a Florida corporation (the "Corporation"), in connection with the Corporation's Quarterly Report on Form 10-Q for the period ended March 31, 2026, as filed with the Securities and Exchange Commission on the date hereof (the "Report"), does hereby represent, warrant and certify pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, as amended, that, to the best of his knowledge:

1. The Report is in full compliance with reporting requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Corporation.

May 7, 2026

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| |
|:---|
| /s/ Brian J. Cobb |
| Brian J. Cobb |
| Chief Financial Officer<br>(Principal Financial Officer and Principal Accounting Officer) |

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