Document:

Exhibit 10.1

 

SETTLEMENT
AGREEMENT AND MUTUAL GENERAL RELEASE

 

THIS
SETTLEMENT AGREEMENT AND MUTUAL GENERAL RELEASE (this “Agreement”) is made as of January 11, 2021, by and between
CipherLoc Corporation, a Texas corporation (“CipherLoc” or the “Company”), on one hand, and the Carmel
Trust (the “Trust”), the Carmel Trust II (“Trust II”), James LaGanke, individually (“LaGanke”)
and as Trustee of both the Trust and Trust II (“Trustee”), collectively, (the “Carmel Parties”), on the
other hand. CipherLoc and the Carmel Parties are referred to individually as a “Party” and together, as the “Parties.”

 

RECITALS

 

WHEREAS,
the Trust owns beneficially and of record 63,750 shares of common stock of CipherLoc, par value $0.01 per share and Trust II owns
beneficially and of record 63,750 shares of common stock of CipherLoc, par value $0.01 per share (together, the “Common
Stock”), and the Trust and Trust II are controlled by the Trustee, who has the power and authority to act and enter into
this Agreement on their behalf;

 

WHEREAS,
Trust II currently owns beneficially and of record 1,000,000 shares of Series A Preferred Stock of CipherLoc, as evidenced by
Certificate #1, par value $0.01 per share (the “Preferred Stock”), and Trust II is controlled by the Trustee, who
has the power and authority to act and enter into this Agreement on its behalf;

 

WHEREAS,
CipherLoc seeks a declaratory judgment invalidating the issuance of the Preferred Stock in a civil action instituted in the United
States District Court for the Western District of Texas, Austin Division, styled as CipherLoc Corporation vs. Michael De La
Garza, MSR, LLC, and James LaGanke, as Trustee of the Carmel Trust II, Civil Action No. 1:19-CV-01147-LY, (the “Lawsuit”);

 

WHEREAS,
CipherLoc and the Carmel Parties each deny all liability to the other party and intends to vigorously defend against the claims
and allegations asserted;

 

WHEREAS,
LaGanke has also asserted unpaid wage claims and other related unpaid compensation claims against CipherLoc via Pamela Thompson,
CPA, PC, of which he is the sole beneficiary (“the Unpaid Compensation Claims”), and CipherLoc has denied liability;

 

WHEREAS,
the Parties desire to avoid the expense, uncertainties, and risks of further litigation between themselves and to fully, finally,
and forever compromise and settle all past and present claims between them including but not limited to all claims which were
raised or capable of being raised in the Lawsuit and all claims arising out of or related to the Preferred Stock and the Common
Stock (together, the “Shares”) and the Unpaid Compensation Claims; and

 

In
consideration of the foregoing and mutual promises and other terms contained herein, and for other good and valuable consideration
hereby deemed received, CipherLoc and the Carmel Parties agree as set forth below.

 

    	SETTLEMENT AGREEMENT AND RELEASE
	PAGE 1

    	 

    

 

TERMS
OF AGREEMENT

 

1.
Payment Terms: In consideration for the promises, releases and agreements herein, CipherLoc will pay the Carmel
Parties the sum of $50,000.00 (the “Settlement Amount”), on or before fifteen (15) business days after (i) the execution
of this Agreement by the Carmel Parties, (ii) actual receipt by CipherLoc of the Subject Securities (as hereinafter defined) and
consummation of the deliveries contemplated by Section 2 below; and (iii) the receipt by CipherLoc of a completed Internal Revenue
Service form W-9 from both LaGanke and his law firm, Frazer Ryan Goldberg & Arnold, LLP (such date, the “Settlement
Date”). Payment is to compensate for the return of the Shares to CipherLoc, certain fees and expenses, and the Unpaid Compensation
Claims. The Settlement Amount shall be paid by CipherLoc by ACH transfer or wire transfer in accordance with wire transfer instructions
separately provided to CipherLoc by the Carmel Parties, with payment to be made to the trust account of Frazer Ryan Goldberg &
Arnold, LLP.

 

2.
Transfer of the Subject Securities: As material consideration for the execution of this Agreement, the Carmel Parties
hereby assign and transfer to CipherLoc, and CipherLoc hereby accepts from the Carmel Parties, free and clear of all liens, charges,
security interests, claims and encumbrances, 1,127,500 of the Shares (the “Subject Securities”). On the date of this
Agreement, the Trustee shall complete and release the Trust Custody Delivery Transfer Request attached hereto as Exhibit A and
instruct CipherLoc’s transfer agent to initiate the transfer of the Subject Securities to CipherLoc via DWAC transfer (the
“Instruction Letter”). On the date of this Agreement, the Trustee shall send by overnight delivery, return receipt
requested, to the addressee on the Instruction Letter, the original signed Instruction Letter together with the original certificate
for the Company’s Common Stock, Certificate #1, issued on December 18, 2013 for 1,000,000 shares of Series A Preferred Stock
of CipherLoc Corporation and stock certificates CS1-45798 and CS1-45799 issued on March 23, 2015 for an aggregate of 12,750,000
shares of common stock, which were subject to a 1-for-100 reverse stock split effectuated on March 12, 2015, and reversed down
to an aggregate of 127,500 shares of Common Stock on that date, endorsed in blank with stock transfer tax stamps affixed and otherwise
in good form for transfer via DWAC. The Carmel Parties shall execute any other documents, transfer powers or assignments necessary
to effectuate the transfer and conveyance of the Subject Securities, including obtaining a medallion guarantee (if required),
and any and all actions required by CipherLoc’s transfer agent to complete the transfer of the Subject Securities, and obtain
a medallion guarantee. The Carmel Parties hereby irrevocably constitute and appoint on the their behalf any director or officer
of CipherLoc as attorney-in-fact to make and execute all necessary documents and instruments of assignment and transfer, to transfer
ownership of the Subject Securities to CipherLoc on the books and records of CipherLoc. This power of attorney is coupled with
an interest and is irrevocable. The Carmel Parties shall assign and transfer to CipherLoc any other shares or ownership interests
they have in CipherLoc. The Parties agree that they are consummating the transactions described in this Agreement by agreement
and hereby waive compliance with any provisions of the certificate of incorporation, bylaws or any other organizational document
or shareholder agreement of CipherLoc to the extent they conflict with this Agreement.

 

    	SETTLEMENT AGREEMENT AND RELEASE
	PAGE 2

    	 

    

 

3.
Tax Treatment: Each Party is responsible for their own respective income tax and other tax, if any, ramifications
that arise from this Agreement and the transactions contemplated herein.

 

4.
Settlement Consideration/Mutual General Releases: The Parties, for themselves and their successors, heirs, purchasers,
and assigns hereby release, acquit, and discharge each other and each other’s parent companies, affiliates, subsidiaries,
successors, assigns, partners, agents, representatives, insurers, sureties, shareholders, officers, directors, attorneys, employees,
servants, and independent contractors of and from any and all past and present claims, demands, debts, rights, actions, damages
(including direct, indirect, incidental, special, consequential, and exemplary damages), costs, causes of action, suits at law
or in equity, expenses and fees of attorneys, expenses and fees of consultants and/or experts and all claims of any nature or
kind whatsoever, whether known or unknown, which the Parties may have had, may now have, or may have in the future against each
other by reason of any matter, cause, or thing arising out of, or in any manner connected with the purchase and ownership of the
Subject Securities, the Lawsuit and/or the Parties dealings with each other, including but not limited to, all claims made or
capable of being made against each other in the Lawsuit, and as described herein, and for any and all future damages arising out
of or related to any agreements between the Parties. It is the express intent of CipherLoc and the Carmel Parties to fully, completely,
and forever release each other from any and all claims now existing, or which may hereafter arise, having anything to do, in any
way, with the Subject Securities, the Lawsuit or the Parties’ dealings with each other. The Parties agree that this release
of claims is intended to be a broadly construed “General Release” and includes any dispute, action or claim that is
known or unknown to each Party, including but not limited to, claims based on a breach of an express or implied contract; breach
of the covenant of good faith and fair dealing; any action arising in tort, including, but not limited to, securities fraud, fraud
and deceit, negligent misrepresentation, libel, slander, defamation, and/or any other claims arising from intentional or negligent
misconduct; and any and all other claims arising in the Lawsuit, under any court decision, statute, rule, regulations or otherwise
of the United States, the State of Texas, and/or any other state or local governmental authority, all as amended, and any other
federal, state or local statute, law, or ordinance, concerning the terms and conditions of the Agreements and/or the business
relationship between or among the Parties; and any claim arising under common law or by public policy, except claims or proceedings
necessary to enforce the provisions of this Settlement Agreement and claims that cannot be waived as a matter of law. It is understood
and agreed that this Settlement Agreement constitutes a full and final release covering all known, unknown, anticipated and unanticipated
injuries, debts, claims or damage that the Parties have, which have arisen, or which may have arisen, in connection with the business
relationship between CipherLoc and the Carmel Parties, as well as those injuries, debts, claims or damages not known or disclosed
which have arisen, or may have arisen, from said business dealings, up to the date that the Parties sign this Settlement Agreement.

 

    	SETTLEMENT AGREEMENT AND RELEASE
	PAGE 3

    	 

    

 

5.
Representations and Warranties: The Carmel Parties represent and warrant that the Trustee has the full power to
take all actions on behalf of the Trust and Trust II (together, the “Trust”), including entering into this Agreement.
The Carmel Parties warrant and represent that the Trust solely owns, has not sold, assigned, pledged granted or transferred, and
will not sell, assign, pledge, grant or transfer to any other person, firm, corporation, or business entity, any of the Carmel
Parties’ claims, causes of action, or ownership interests or any part thereof covered by this Agreement. The Carmel Parties
agree to indemnify CipherLoc for any damages, attorney’s fees and/or costs it incurs in litigation if any of the representations
and/or warranties made by the Carmel Parties in this Agreement is proven to be untrue in a court of law or equity. The Carmel
Parties warrant and represent that the Trust is the sole holder of record of the Subject Securities; that no other party including
LaGanke has any security or other interest in the Subject Securities; that the Subject Securities are not subject to any lien,
claim or encumbrance; that the Trust has good and marketable title to the Subject Securities; and that upon the transfer of the
Subject Securities contemplated by this Agreement, CipherLoc will obtain good and marketable title to the Subject Securities,
free of all liens, claims and encumbrances.

 

6.
Attorneys’ Fees and Costs: The Parties agree that each Party shall be solely responsible for its own respective
litigation fees, attorneys’ fees, expenses, and other costs and expenses incurred in connection with the execution and performance
of this Agreement and in connection with the Lawsuit.

 

7.
Dismissal: Immediately upon payment of the Settlement Amount but no later than three (3) business days after the
Settlement Date, the Trustee and his counsel shall execute and CipherLoc shall file with the court the agreed motion for dismissal
with prejudice, attached hereto as Exhibit “B,” and the proposed order granting motion for dismissal with prejudice,
in the form attached hereto as Exhibit C (and any required related pleadings) that
dismisses all of the claims in the Lawsuit, with prejudice. The Carmel Parties shall return the Settlement Amount if the Court
does not dismiss the Lawsuit with prejudice.

 

8.
Future Actions: In exchange for the consideration set forth in this Settlement Agreement, the Carmel Parties each
agree that they will not directly or indirectly purchase shares or any interests in CipherLoc or any subsidiary of CipherLoc in
the future. In addition, the Carmel Parties each agree that they and their affiliates (as defined in Rule 12b-2 under the Securities
Exchange Act of 1934, as amended (the “Exchange Act”)) will not (and will not assist, provide or arrange financing
to or for others or encourage others to), directly or indirectly, acting alone or in concert with others, unless specifically
requested in writing in advance by the Company’s Board of Directors (or similar governing body) for the period commencing
on the date of this Agreement and ending on the 5th anniversary thereof: (i) acquire or agree, offer, seek or propose to acquire
(or request permission to do so), ownership (including, but not limited to, beneficial ownership as defined in Rule 13d-3 under
the Exchange Act) of any of the assets or businesses of the Company or any securities, bank debt or trade debt issued by the Company,
or any rights or options to acquire such ownership (including from a third party), (ii) seek or propose to influence or control
the management or the policies of the Company or to obtain representation on the Company’s Board of Directors, or solicit,
or participate in the solicitation of, any proxies, consents or votes with respect to any securities of the Company or with respect
to any plan of reorganization filed by the Company or any other person in connection with a bankruptcy or similar proceeding under
state or federal law involving the Company or any of its subsidiaries, (iii) enter into any discussions, negotiations, arrangements
or understandings with any third party with respect to any of the foregoing or (iv) seek or request permission to do any of the
foregoing or make or seek permission to make any public announcement with respect to any of the foregoing.

 

    	SETTLEMENT AGREEMENT AND RELEASE
	PAGE 4

    	 

    

 

9.
Non-Disparagement: In exchange for the consideration set forth in this Agreement, the Carmel Parties agree not to
make any false or disparaging, derogatory or negative statements, comments or remarks about CipherLoc, Tom Wilkinson, Anthony
Ambrose, Sammy Davis, Zeynep Young, David Chasteen, the board of directors as a whole, CipherLoc’s goods and services, management,
valuation, employees, contractors, officers, directors or attorneys. Likewise, CipherLoc agrees not to make any false or disparaging,
derogatory or negative statements, comments or remarks about the Carmel Parties. Nothing in this Agreement shall preclude any
Party from testifying or providing truthful statements in accordance with any court order, subpoena, summons or other legal process.

 

10.
Cooperation: The Carmel Parties understand that CipherLoc is a party to litigation with certain third parties, including,
but not limited to, Robert LeBlanc and Eric Marquez. The Carmel Parties agree that each will cooperate fully with any reasonable
requests or efforts by CipherLoc to secure their testimony, in these disputes and will testify in depositions and otherwise, as
requested by CipherLoc, but at no out of pocket expense to the Carmel Parties except for expenses they would have incurred if
they were responding to a subpoena or order of a court. The Carmel Parties shall immediately notify CipherLoc if they are requested
to produce documents to or testify in any dispute or proceedings in which CipherLoc is a party. The Carmel Parties agree and acknowledge
that the Company may file this Agreement (including any of its exhibits and schedules) with the Securities and Exchange Commission
and make such other statements as are required by applicable law, rule or regulation.

 

11.
Market Stand-Off: The Carmel Parties each agree that they will not, without the prior written consent of the managing
underwriter (which, for purposes of this provision, shall include placement agents and parties performing a similar function),
during the period commencing on the date of the closing of any sale by CipherLoc of any of its securities and ending on the date
specified by the Company and the managing underwriter (such period not to exceed one hundred eighty (180) days), or such other
period as may be requested by the Company or an underwriter to accommodate regulatory restrictions on (1) the publication or other
distribution of research reports, and (2) analyst recommendations and opinions, including, but not limited to, the restrictions
contained in FINRA Rule 2711(f)(4) or NYSE Rule 472(f)(4), or any successor provisions or amendments thereto) (i) lend; offer;
pledge; sell; contract to sell; sell any option or contract to purchase; purchase any option or contract to sell; grant any option,
right, or warrant to purchase; or otherwise transfer or dispose of, directly or indirectly, any shares of Common Stock or any
securities convertible into or exercisable or exchangeable (directly or indirectly) for Common Stock (whether such shares or any
such securities are then owned by the Carmel Parties or are thereafter acquired or (ii) enter into any swap or other arrangement
that transfers to another, in whole or in part, any of the economic consequences of ownership of such securities, whether any
such transaction described in clause (i) or (ii) above is to be settled by delivery of Common Stock or other securities, in cash,
or otherwise. The underwriters in connection with such registration are intended third-party beneficiaries of this provision and
shall have the right, power and authority to enforce the provisions hereof as though they were a party hereto. The Carmel Parties
further agree to execute such agreements as may be reasonably requested by the underwriters in connection with such registration
that are consistent with this provision or that are necessary to give further effect thereto.

 

    	SETTLEMENT AGREEMENT AND RELEASE
	PAGE 5

    	 

    

 

12.
Proxy: In consideration of this Agreement, the Carmel Parties hereby appoint Tom Wilkinson as the true and lawful
representative of the undersigned with full power of substitution and revocation, and authorizes him to vote all the shares of
capital stock of the Company which the Carmel Parties are entitled to vote in connection with any stockholders meeting, any adjournment
or postponement thereof, and any written consent or other stockholder action, upon any and all matters to be voted upon in connection
with such action, and exercise all related rights (to the fullest extent that Carmel Parties are entitled to do so) with respect
to all of the shares of capital stock of the Company that now are or hereafter may be beneficially owned by Carmel Parties, and
any and all other shares or securities of the Company issued or issuable in respect thereof on or after the date hereof in accordance
with the terms of this provision, conferring authority upon such true and lawful attorney to vote in his discretion on all such
matters as may be presented for a vote of the Company’s stockholders, for a period of five years from the date of this Agreement.
The Carmel Parties revoke any proxy heretofore given with respect to such capital stock and agrees not to grant any other proxies
with respect thereto during such five year period. This proxy is coupled with an interest and is irrevocable.

 

13.
No Admission of Liability: Notwithstanding any other provision, the Parties acknowledge and agree that this settlement
is a compromise of disputed claims and neither the existence of this Agreement, nor any recitals, terms, conditions, or other
statements contained in it, shall be construed as an admission of liability by or on the part of the Parties with respect to any
allegation or claim. The Parties do not admit, but expressly deny all liability for the claims asserted against them and enter
into this settlement solely to avoid the expense, uncertainties, and risks of further litigation. Consequently, no evidence relating
to the existence of the terms or negotiations of this Agreement, shall be admissible in the Lawsuit or in any other action, suit,
or legal proceeding as evidence of any liability, culpability, or fault of or on the part of either Party; provided, however,
that such evidence may be offered in a proceeding seeking to enforce the terms of this Agreement.

 

14.
Fully Informed: Each Party expressly warrants and represents that before executing this Agreement, it has fully
informed itself/himself/herself of the terms, conditions, and effect of this Agreement, that no promises or representations of
any kind have been made to it/him/her by or on behalf of anyone, except as expressly stated herein, and that it/him/her has had
the advice of counsel, if it/him/her so desired. Each Party acknowledges that it/him/her has entered into this Agreement voluntarily
and with full knowledge and understanding of its import. Each Party has read and fully understands the terms of this Agreement
and agrees to be bound hereby. Moreover, the Parties agree that this Agreement was drafted, reviewed, and agreed upon by both
Parties, and, in the event an ambiguity or question of intent or interpretation arises, this Agreement shall be construed as jointly
drafted by the Parties and no presumption or burden of proof shall arise favoring or disfavoring any Party by virtue of the authorship
of any provision herein.

 

    	SETTLEMENT AGREEMENT AND RELEASE
	PAGE 6

    	 

    

 

15.
Entire Agreement: This instrument, along with the exhibits hereto, contains the entire agreement between the Parties,
and all previous discussions, understandings, representations, negotiations, and agreements are merged herein. Additionally, the
consideration recited above is the full, complete, and entire consideration for this Agreement, and there is no further consideration
to be paid other than as recited herein. All representation and warranties contained in this Agreement shall survive the execution
and delivery of this Agreement and the delivery of the Subject Securities contemplated hereby, and shall continue in full force
and effect for the maximum period permitted by applicable law.

 

16.
Severability: If any provision or any part of this Agreement is found void or unenforceable, then the remainder
of this Agreement shall not be affected thereby.

 

17.
Binding Effect: This Agreement shall be binding upon and inure to the benefit of the Parties, and each of their
respective successors in interest, purchasers, and assigns.

 

18.
Authority to Execute: CipherLoc and the Carmel Parties hereby represent and warrant that they each have the power
and are duly authorized to enter into this Agreement with regard to all matters described herein.

 

19.
Headings: The headings of the sections of this Agreement are for the convenience of reference only, are not to be
considered a part hereof, and shall not limit or otherwise affect any of the terms hereof or thereof.

 

20.
Counterparts: This Agreement may be signed in counterparts, each copy of which shall be deemed an original and all
of which together shall constitute one and the same instrument.

 

21.
Applicable Law and Arbitration: This Agreement will be governed by, and construed exclusively in accordance with,
the laws of the State of Texas. Any action arising out of or relating to this Agreement, or any breach shall be referred to and
finally settled by mandatory binding arbitration in Dallas, Texas. The parties agree that this arbitration shall be governed by
the Texas General Arbitration Act, Tex. Civ. Prac. & Rem. Code § 171 et seq. The Arbitration shall be administered by
JAMS pursuant to its Comprehensive Arbitration Rules and Procedures, except that notwithstanding anything to the contrary in the
JAMS rules, full discovery shall be permitted as allowed by the Texas Rules of Civil Procedure that govern discovery. Such arbitration
shall be conducted before a single arbitrator which shall be appointed by JAMS in accordance with its rules. Judgment on a binding
arbitration award may be entered in any court of competent jurisdiction. The Parties mutually acknowledge that, by this agreement
to arbitrate, each Party irrevocably waives it/him/her rights to court or jury trial. The arbitration hearing shall be held within
six months after the filing of the arbitration demand with JAMS. The Party prevailing in any such arbitration shall be entitled
to recover, and the arbitrator shall award to the prevailing Party, the reasonable attorneys’ fees incurred by the prevailing
Party in connection with enforcing it/him/her rights under this Agreement.

 

    	SETTLEMENT AGREEMENT AND RELEASE
	PAGE 7

    	 

    

 

22.
Notices: Any notice, request, instruction, or other document or communication required or permitted to be given
under this Settlement Agreement shall be in writing and shall be deemed given (i) upon receipt if delivered in person or by a
messenger or courier service; or (ii) three business days after being deposited in the U.S. mail, certified or registered, return
receipt requested, postage prepaid, with a courtesy copy, which does not constitute notice, delivered or emailed to the other
Party, as follows:

 

If
to CipherLoc, delivered to:

 

CipherLoc
Corporation

Attn:
Tom Wilkinson, Chairman of the Board of Directors

6836
Bee Caves Road

Building
1, Suite 279

Austin,
Texas 78746

Email:
twilkinson@cipherloc.net

 

With
copies to:

 

Dwight
M. Francis

Sheppard
Mullin Richter & Hampton LLP

2200
Ross Avenue, 24th Floor

Dallas,
Texas 75201

Email:
dfrancis@sheppardmullin.com

 

If
to LaGanke, delivered to:

 

James
LaGanke, as Trustee of the Carmel Trust II

736
E. Braeburn Drive

Phoenix,
Arizona 85022

 

With
copies to:

 

Philip
B. Whitaker

Frazer
Ryan Goldberg & Arnold, LLP

1850
N. Central Avenue, Suite 1800

Phoenix,
AZ 85004

Email:
pwhitaker@frgalaw.com

 

or
to such other address or addresses as may be specified in writing from time to time by any Party to the other Party.

 

THIS
AGREEMENT AND EXHIBITS, IF ANY, TOGETHER CONSTITUTE THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE
OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES EXCEPT BY AN AGREEMENT IN WRITING EXECUTED BY THE PARTY
TO BE CHARGED. THERE ARE NO ORAL, UNWRITTEN AGREEMENTS BETWEEN THE PARTIES.

 

    	SETTLEMENT AGREEMENT AND RELEASE
	PAGE 8

    	 

    

 

IN
WITNESS WHEREOF, the undersigned, by its duly authorized officer(s), has hereunto set its hand and seal on the day and year first
written above.

 

	 	CIPHERLOC
    CORPORATION
	 	 	 
	 	By:	/s/
    Thomas Wilkinson
	 	 	Thomas
    Wilkinson
	 	 	 
	 	Its:	Chairman
    of the Board of Directors
	 	 	 
	 	Date:	January
    15, 2021

 

	STATE
    OF TEXAS	 	)
	 	 	)
	COUNTY
    OF TRAVIS	 	)

 

Personally
appeared before me this _______ day of ____________, 2021, ____________________ to me properly identified as the same; who acknowledged
that he has executed the foregoing instrument in his own free act and deed for the purposes therein expressed.

 

	 	(SEAL)
	NOTARY
    PUBLIC FOR TEXAS	 
	 	 
	My
    Commission Expires:                                 	 

 

    	SETTLEMENT AGREEMENT AND RELEASE
	PAGE 9

    	 

    

 

IN
WITNESS WHEREOF, the undersigned, by its duly authorized officer(s), has hereunto set its hand and seal on the day and year first
written above.

 

	 	 	THE
    CARMEL TRUST
	 	 	 
	 	 	/s/
    James LaGanke
	 	 	JAMES
    LAGANKE, AS TRUSTEE OF THE CARMEL TRUST
	 	 	 
	 	 	Date:
    January 12, 2021

 

	STATE
    OF ARIZONA	 	)
	 	 	)
	COUNTY
    OF MARICOPA	 	)

 

Personally
appeared before me this _______ day of ____________, 2021, ________________ to me properly identified as the same; who acknowledged
that he has executed the foregoing instrument in his own free act and deed for the purposes therein expressed.

 

	 	(SEAL)
	NOTARY
    PUBLIC FOR ARIZONA	 
	 	 
	My
    Commission Expires:                                 	 

 

    	SETTLEMENT AGREEMENT AND RELEASE
	PAGE 10

    	 

    

 

IN
WITNESS WHEREOF, the undersigned, by its duly authorized officer(s), has hereunto set its hand and seal on the day and year first
written above.

 

	 	 	THE
    TRUSTEE OF THE CARMEL TRUST II
	 	 	 
	 	 	/s/
    James LaGanke
	 	 	JAMES
    LAGANKE, AS TRUSTEE OF THE CARMEL TRUST II
	 	 	 
	 	 	Date:
    January 12, 2021

 

	STATE
    OF ARIZONA	 	)
	 	 	)
	COUNTY
    OF MARICOPA	 	)

 

Personally
appeared before me this _______ day of ____________, 2021, ________________ to me properly identified as the same; who acknowledged
that he has executed the foregoing instrument in his own free act and deed for the purposes therein expressed.

 

	 	(SEAL)
	NOTARY
    PUBLIC FOR ARIZONA	 
	 	 
	My
    Commission Expires:                                 	 

 

    	SETTLEMENT AGREEMENT AND RELEASE
	PAGE 11

    	 

    

 

IN
WITNESS WHEREOF, the undersigned, by its duly authorized officer(s), has hereunto set its hand and seal on the day and year first
written above.

 

	 	 	/s/
    James LaGanke
	 	 	JAMES
    LAGANKE, Individually
	 	 	 
	 	 	Date:
    January 12, 2021

 

	STATE
    OF ARIZONA	 	)
	 	 	)
	COUNTY
    OF MARICOPA	 	)

 

Personally
appeared before me this _______ day of ____________, 2021, ________________ to me properly identified as the same; who acknowledged
that he has executed the foregoing instrument in his own free act and deed for the purposes therein expressed.

 

	 	(SEAL)
	NOTARY
    PUBLIC FOR ARIZONA	 
	 	 
	My
    Commission Expires:                                 	 

 

    	SETTLEMENT AGREEMENT AND RELEASE
	PAGE 12

    	 

    

 

EXHIBIT
A

 

    	 

    	 

    

 

James
LaGanke, as Trustee of the Carmel Trust II

736
E. Braeburn Drive

Phoenix,
Arizona 85022

 

January
11, 2020

 

Paul
Bednar

Client
Services Manager

Pacific
Stock Transfer Company

6725
Via Austin Pkwy., Ste. 300

Las
Vegas, NV 89119

 

Dear
Mr. Bednar:

 

Enclosed
here with please find stock certificate #1, issued on December 18, 2013 for 1,000,000 shares of Series A Preferred Stock of CipherLoc
Corporation and stock certificates CS1-45798 and CS1-45799 issued on March 23, 2015 for an aggregate of 12,750,000 shares of common
stock, which were subject to a 1-for-100 reverse stock split effectuated on March 12, 2015, and reversed down to an aggregate
of 127,500 shares of Common Stock on that date. Please return to the treasury of CipherLoc Corporation 1,127,500 of the shares
represented by such certificates.

 

	 	Very
    truly yours,
	 	 
	 	 
	 	James
    LaGanke, as Trustee of the Carmel Trust and the Carmel Trust II

 

    	 

    	 

    

 

EXHIBIT
B

 

    	 

    	 

    

 

IN
THE UNITED STATES DISTRICT COURT

FOR
THE WESTERN DISTRICT OF TEXAS

AUSTIN
DIVISION

 

	CIPHERLOC
        CORPORATION, a Texas 

Corporation,

        Plaintiff,

        v.

         

        MICHAEL
        DE LA GARZA, an individual, 

MSR, LLC, and JAMES LAGANKE, as 

Trustee of the CARMEL TRUST II,

         

        Defendants.
	 	 

        Civil
        Action No. 1:19-CV-01147-LY

         

 

STIPULATED
MOTION TO DISMISS

 

Pursuant
to Rule 41(a)(1)(A)(ii) of the Federal Rules of Civil Procedure, Plaintiff CipherLoc Corporation (“Plaintiff”) and
Defendant James LaGanke, as Trustee of the Carmel Trust II (“Defendant”) hereby jointly move for judgment of dismissal
as to Defendants. Plaintiff hereby dismisses its complaint against Defendants with prejudice and Defendants dismiss all counterclaims,
if any, against Plaintiff with prejudice. Each party agrees to bear his/its own costs and attorneys’ fees

 

Dated:January
___, 2021

 

	SHEPPARD,
    MULLIN, RICHTER & HAMPTON LLP	 	Frazer
    Ryan Goldberg & Arnold, LLP
	 	 	 
	/s/
    Dwight M. Francis	 	/s/
    Philip B. Whitaker
	Dwight
        M. Francis

        Texas
        Bar No. 00785877

        Aimee
        C. Oleson

        Texas
        Bar No. 24036391

        2200
        Ross Avenue, 24th Floor

        Dallas,
        Texas 75201

        Tel.
        (469) 391-7400

        Fax
        (469) 391-7401

        dfrancis@sheppardmullin.com

        aoleson@sheppardmullin.com

         

        Attorneys
        for Plaintiff CipherLoc Corporation
	 	Philip
        B. Whitaker

        Arizona
        Bar No. 011765

        1850
        N. Central Avenue, Suite 1800

        Phoenix,
        AZ 85004

        Telephone:
        (602) 277-2010

        Facsimile:
        (602) 277-2595

        pwhitaker@frgalaw.com

         

        Daniel
        H. Byrne

        Texas
        Bar No. 03565600

        Lisa
        C. Fancher

        Texas
        Bar No. 06800275

        221
        West 6th Street, Suite 960

        Austin,
        Texas 78701

        Telephone:
        (512) 476-2020

        Facsimile:
        512-477-5267

        dbyrne@fbhg.law

        lfancher@fbhg.law

         

        Attorney
for Defendant James LaGanke, as Trustee of the Carmel Trust II

 

    	STIPULATED MOTION TO DISMISS
	PAGE 1

    	 

    

 

EXHIBIT
C

 

    	 

    	 

    

 

IN
THE UNITED STATES DISTRICT COURT

FOR
THE WESTERN DISTRICT OF TEXAS

AUSTIN
DIVISION

 

	CIPHERLOC
        CORPORATION, a Texas 

Corporation,

        Plaintiff,

        v.

        MICHAEL
        DE LA GARZA, an individual, 

MSR, LLC, and JAMES LAGANKE, as 

Trustee of the CARMEL TRUST II,

        Defendants.
	 	 

        Civil
        Action No. 1:19-CV-01147-LY

         

 

ORDER
GRANTING STIPULATED MOTION TO DISMISS

 

Based
on the Stipulated Motion to Dismiss (the “Motion”), after reviewing pleadings and papers on file, being fully advised,
and for good cause appearing, the Court hereby GRANTS the Motion. Plaintiff CipherLoc Corporation’s claims against James
LaGanke, as Trustee of the Carmel Trust II are DISMISSED with prejudice and James LaGanke, as Trustee of the Carmel Trust II’s
counterclaims, if any, are DISMISSED with prejudice. All costs of court incurred to date shall be borne by the party previously
incurring the same.

 

All
relief not expressly granted herein is denied.

 

	 	 
	 	JUDGE
    PRESIDING

 

    	ORDER GRANTING STIPULATED MOTION TO DISMISS
	PAGE 1Exhibit 10.1

 

THIS NOTE HAS NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”). THIS NOTE HAS BEEN ACQUIRED FOR INVESTMENT ONLY AND
MAY NOT BE SOLD, TRANSFERRED OR ASSIGNED IN THE ABSENCE OF REGISTRATION OF THE RESALE THEREOF UNDER THE SECURITIES ACT OR AN OPINION
OF COUNSEL REASONABLY SATISFACTORY IN FORM, SCOPE AND SUBSTANCE TO THE MAKER THAT SUCH REGISTRATION IS NOT REQUIRED.

 

PROMISSORY NOTE

 

November 19, 2020

 

$300,000

No. A-1

 

FTAC Athena Acquisition Corp. (the “Maker”)
promises to pay to the order of FTAC Athena Sponsor, LLC or its designee (collectively, the “Payee”) the principal
sum of up to Three Hundred Thousand ($300,000) in lawful money of the United States of America, on the terms and conditions described
below.

 

1. Principal.
The principal balance of this Note shall be repayable on earlier of (the “Maturity Date”) (a) the date on which
Maker consummates its initial public offering (“IPO”) and (b) June 30, 2021.

 

2. Interest.
This Note shall bear no interest.

 

3. Application of
Payments. All payments shall be applied first to payment in full of any costs incurred in the collection of any sum due under
this Note, including (without limitation) reasonable attorneys’ fees, then to the payment in full of any late charges and
finally to the reduction of the unpaid principal balance of this Note.

 

4. Events of Default.
The following shall constitute Events of Default:

 

(a) Failure
to Make Required Payments. Failure by Maker to pay the principal of, or other payments on, this Note within five (5) business
days following the date when due.

 

5. Remedies.
Upon the occurrence of an Event of Default specified in Section 4(a), Payee may, by written notice to Maker, declare this Note
to be due and payable, whereupon the principal amount of this Note, and all other amounts payable under this Note, shall become
immediately due and payable without presentment, demand, protest or other notice of any kind, all of which are hereby expressly
waived, anything contained herein or in the documents evidencing the same to the contrary notwithstanding.

 

6. Waivers.
Maker and all endorsers and guarantors of, and sureties for, this Note waive presentment for payment, demand, notice of dishonor,
protest, and notice of protest with regard to this Note, all errors, defects and imperfections in any proceedings instituted by
Payee under the terms of this Note, and all benefits that might accrue to Maker by virtue of any present or future laws exempting
any property, real or personal, or any part of the proceeds arising from any sale of any such property, from attachment, levy or
sale under execution, or providing for any stay of execution, exemption from civil process, or extension of time for payment; and
Maker agrees that any real estate that may be levied upon pursuant to a judgment obtained by virtue hereof, on any writ of execution
issued hereon, may be sold upon any such writ in whole or in part in any order desired by Payee.

 

7. Unconditional
Liability. Maker hereby waives all notices in connection with the delivery, acceptance, performance, default, or enforcement
of the payment of this Note, and agrees that its liability shall be unconditional, without regard to the liability of any other
party, and shall not be affected in any manner by any indulgence, extension of time, renewal, waiver or modification granted or
consented to by Payee, and consents to any and all extensions of time, renewals, waivers, or modifications that may be granted
by Payee with respect to the payment or other provisions of this Note, and agrees that additional makers, endorsers, guarantors,
or sureties may become parties hereto without notice to them or affecting their liability hereunder.

 

     

     

    

 

8. Notices.
Any notice called for hereunder shall be deemed properly given if (i) sent by certified mail, return receipt requested, (ii) personally
delivered, (iii) dispatched by any form of private or governmental express mail or delivery service providing receipted delivery,
(iv) sent by facsimile or (v) sent by e-mail, to the following addresses or to such other address as either party may designate
by notice in accordance with this Section:

 

If to Maker:

 

FTAC Athena Acquisition Corp.

2929 Arch Street, Suite 1703

Philadelphia, PA 19104

Attention: Amanda Abrams

Email: aabrams@cohenandcompany.com

 

If to Payee:

 

FTAC Athena Sponsor, LLC

3 Columbus Circle, 24th Floor

New York, NY 10019

Attention: Manager

Email: aabrams@cohenandcompany.com

 

Notice shall be deemed given on the earlier of (i) actual receipt
by the receiving party, (ii) the date shown on a facsimile transmission confirmation, (iii) the date on which an e-mail transmission
was received by the receiving party’s on-line access provider, (iv) the date reflected on a signed delivery receipt, or (vi)
two (2) business days following tender of delivery or dispatch by express mail or delivery service.

 

9. Construction. THIS
NOTE SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICT OF LAW PROVISIONS
THEREOF.

 

10. Severability.
Any provision contained in this Note which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any
such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other
jurisdiction.

 

11. Trust Waiver.
Notwithstanding anything herein to the contrary, the Payee hereby waives any and all right, title, interest or claim of any kind
(“Claim”) in or to any distribution of the trust account (other than interest income earned on such
trust account) in which will be deposited the proceeds of Maker’s IPO and the proceeds of the sale of the securities issued
in a private placement to be consummated concurrently with the completion of the Maker’s IPO, and hereby agrees not to seek
recourse, reimbursement, payment or satisfaction for any Claim against the trust account (other than interest income earned on
such trust account) for any reason whatsoever.

 

12. Amendment; Waiver. Any
amendment hereto or waiver of any provision hereof may be made with, and only with, the written consent of the Maker and the Payee.

 

13. Assignment.
No assignment or transfer of this Note or any rights or obligations hereunder may be made by any party hereto (by operation of
law or otherwise) without the prior written consent of the other party hereto and any attempted assignment without the required
consent shall be void.

 

[Signature Page Follows]

 

    2

     

    

 

IN WITNESS WHEREOF, Maker, intending to
be legally bound hereby, has caused this Note to be duly executed the day and year first above written.

 

	 	FTAC ATHENA ACQUISITION CORP.
	 	 	 
	 	By:	/s/ Betsy Z. Cohen
	 	Name: 	Betsy Z. Cohen
	 	Title:	Chairman

 

[Signature Page – Promissory Note
Pre-IPO]

 

 

3

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