Document:

ex_108486.htm

Exhibit 10.2

 

SECURITY AGREEMENT

 

THIS SECURITY AGREEMENT (together with all amendments, supplements or other modifications, this “Agreement”) is effective as of March 15, 2018 by and between SAKER AVIATION SERVICES, INC., a corporation organized under the laws of the State of Nevada and having an address at 20 South Street, Pier 6 East River, New York, NY 10004, (“Borrower”) and KEYBANK NATIONAL ASSOCIATION, a national banking association with a banking office at 731 Chestnut Street, Emmaus PA 18049 (“Lender”). 

 

As a condition precedent to Lender’s making any loans or to otherwise extend credit to Borrower under the Loan Agreement, Borrower agreed to execute an deliver to Lender a security agreement substantially in the form hereof. Borrower wishes to grant a security interest in favor of Lender as hereafter provided. In consideration of the promises contained herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, it is agreed as follows:

 

1.     Definitions. Capitalized terms that are used in this Agreement, but not otherwise defined in this Agreement, shall have the meanings specified in the Loan Agreement dated as of even date herewith by and between Borrower and Lender (the “Loan Agreement”). All terms (capitalized or otherwise) that are (a) now or hereafter defined in the Uniform Commercial Code (“UCC”) as in effect in the Commonwealth of Pennsylvania and (b) used herein, but not defined in this Agreement or in the Loan Agreement, shall have, in each such instance, the meanings specified in the Pennsylvania UCC, unless the context dictates otherwise.

 

2.     Grant of Security Interest. Borrower hereby grants to Lender a continuing security interest in and pledge of (“Security Interest”) all of the following property, assets and rights of Borrower, whether now existing or hereafter acquired or created, and wherever located (all of the same being the “Collateral”):

 

(a)     all equipment, fixtures, inventory, and goods (excluding consumer goods);

 

(b)     all accounts, chattel paper, documents, instruments, investment property, general intangibles, and letter-of-credit rights, and any commercial tort claims disclosed by Borrower to Lender pursuant to the terms herein;

 

(c)     all deposit accounts, money, cash, and other funds deposited in any deposit accounts, property in Lender’s control or possession, insurance refunds, insurance claims, tax refunds, tax refund claims and other rights to the payment of money; 

 

(d)     all software, books, records and files of whatever type or nature, whether or not written, stored electronically or electromagnetically or in any other form;

 

(e)     all supporting obligations of, all increases or profits received from, all insurance or condemnation proceeds of, all tort or other claims against third parties arising out of damage to or destruction of, all property received wholly or partly in trade or exchange of the foregoing Collateral; and

 

(f)     all attachments, accessions, parts and appurtenances to, and all substitutions for, and all replacements of, and all proceeds of, all of the foregoing Collateral.

 

3.     Obligations Secured. The Security Interest granted by Borrower herein secures the full, prompt and complete payment and performance of all of the Obligations (as defined in the Loan Agreement). 

 

4.     Representations and Warranties of Borrower. Borrower represents and warrants, and so long as any Obligations remains unpaid shall be deemed continuously to represent and warrant, that:

 

(a)     Borrower is a corporation, duly organized, validly existing and in good standing under the laws of the State of Nevada and its exact name is that indicated on the signature page hereof;

 

(b)     The Charter Documents of Borrower delivered to Lender are valid and in full force and effect and have not been amended, restated, replaced or otherwise modified;

 

(c)     Borrower is the owner of the Collateral free and clear of any right or claim of any Persons or any security interest, lien or other encumbrances, except the Security Interest in favor of Lender and any liens identified on Schedule A attached hereto (“Permitted Liens”);

 

 

 

 

(d)     Borrower has the power and authority to own the Collateral, to grant the Security Interest and to enter into and perform this Agreement and any other document or instrument delivered in connection herewith; and

 

(e)     Except as may hereafter be disclosed in writing by Borrower to Lender, the Collateral is located at and used in connection with Borrower’s business operations at the address(es) specified on Schedule A hereto, and Borrower’s records concerning the Collateral are kept only at such address(es).

 

5.     Covenants of Borrower. Borrower covenants and agrees as follows:

 

(a)     Restrictions on Transfers. Borrower will defend the Collateral against the claims and demands of all other Persons at any time claiming interests adverse to Lender including, without limitation, defenses, setoffs, claims and counterclaims asserted by any obligor against Borrower and/or Lender. Borrower will keep the Collateral free from any right or claim of any other Person or any security interests, liens or other encumbrances, except for Permitted Liens, and will not sell, transfer, lease, assign, deliver or otherwise dispose of any Collateral or any interest therein without the prior written consent of Lender except for sales of inventory in the ordinary course of Borrower’s business. Borrower shall not pledge, mortgage, create or suffer to exist any right of any Person in or claim by any Person to the Collateral or any security interest in the Collateral in favor of any Person, or become bound by a security agreement in favor of any Person as secured party except for Permitted Liens, if any;

 

(b)     Books and Records. Borrower will keep, in accordance with generally accepted accounting principles consistently applied, accurate and complete records concerning the Collateral, and at Lender’s request, Borrower will mark any and all such records to indicate the Security Interest and will permit Lender or its agents to inspect the Collateral and to audit and make extracts from such records or any of Borrower’s books, ledgers, financial reports, correspondence or other records;

 

(c)     Delivery of Collateral to Lender. Except in connection with Permitted Liens, if any, Borrower will deliver to Lender, upon demand, any instruments, documents and chattel paper constituting, representing or relating to the Collateral or any part thereof and any schedules, invoices, shipping documents, delivery receipts, purchase orders, contracts or other documents representing or relating to the Collateral or any part thereof;

 

(d)     Borrower Information. Without thirty (30) days’ prior written notice to Lender, Borrower will not (i) change its state of personal residence, business addresses or chief executive office, or (ii) make any change in Borrower’s name (such as a change in name on Borrower’s driver’s license, if an individual), state of organization, identity or type of organization; 

 

(e)     Maintenance of Collateral. Borrower will keep the Collateral in good condition, working order and repair and will not use the Collateral in violation of any provisions of this Agreement, any applicable Law or governmental regulation or of any policy insuring the Collateral, unless the failure to so keep the Collateral will not have a material adverse effect on Borrower, the Collateral, or the business, operation, assets or affairs of Borrower;

 

(f)     Taxes and Insurance. Borrower will (i) promptly pay all taxes, assessments and other charges of every nature which may be levied or assessed against the Collateral other than taxes, assessments, fees and charges being contested in good faith by appropriate proceedings being diligently pursued, and (ii) at all times keep the Collateral insured against loss, damage, theft and other risks, in such amounts, with such financially sound and reputable insurance carriers and under such form of policies as shall be acceptable to Lender, with appropriate endorsements designating Lender as lender loss payee and additional insured, as requested by Lender, and which policies of insurance shall provide that all losses thereunder shall be payable to Lender, as its interest may appear, and Lender may apply any proceeds of such insurance received by it toward payment of any of the Obligations, whether or not due, in such order of application as Lender may determine. The original or duplicates of such policies of insurance or certificates thereof shall be delivered to Lender, no later than the date hereof, upon each renewal and upon its request. In the event of failure by Borrower to provide and maintain such insurance, Lender may, at its option, provide such insurance and charge the cost thereof to Borrower;

 

(g)     No Accession. Borrower will not permit any part of the Collateral to be or become an accession to other goods not covered by this Agreement;

 

(h)     Change of Location. Borrower will maintain possession of all tangible Collateral at the locations set forth on Schedule A hereto except on the satisfaction of the following conditions: (i) Borrower has given Lender at least thirty (30) days’ prior notice of such action, (ii) Borrower has complied with the other terms of this Agreement, (iii) such new location is within the continental United States, (iv) Lender continuously maintains its first priority Lien thereon, and (v) if requested by Lender, Borrower has caused to be delivered to Lender a landlord waiver, bailee, warehouseman or similar written agreement, in form and substance acceptable to Lender. Notwithstanding the foregoing, the limitations in this clause will not apply to (A) inventory in transit, (B) sales of inventory in the ordinary course of business, (C) disposal of Collateral as expressly permitted by this Agreement or the other Loan Documents, (D) Collateral in the possession of Lender, and (E) Collateral comprised of books and records of Borrower, to the extent that Borrower maintains possession of such books and records at its chief executive office;

 

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(i)     Commercial Tort Claims. If Borrower shall at any time hold or acquire Collateral comprised of one or more commercial tort claims with an aggregate reasonably anticipated value in excess of $50,000.00, Borrower shall promptly notify Lender in a writing signed by Borrower of the particulars thereof and grant to Lender in such writing a security interest therein and in the proceeds thereof, all upon the terms of this Agreement, with such writing to be in form and substance satisfactory to Lender in good faith;

 

(j)     Third Party Waivers. If all or any part of the Collateral is located on property which is not owned by Borrower, Borrower will deliver to Lender for each such location a landlord’s waiver or other third party Waiver, as applicable; and

 

(k)     Lender Requests. Borrower will execute and deliver to Lender such certificates of title, assignments and other documents and will take such other actions relating to the Security Interest and the validity, enforceability, priority and perfection thereof as Lender may reasonably request and will pay all costs of title searches and filing financing statements, certificates of title, assignments and other documents in all public offices requested by Lender.

 

6.     Accounts and Account Debtors. Borrower authorizes Lender (and any of Lender’s designated officers, employees or agents), without further authorization from Borrower, to sign its name and to take any of the following actions, in its name or in the name of Lender, as Lender may determine, at any time (except as expressly limited in this Section 6) without notice to Borrower and at Borrower’s expense: (a) verify the validity and amount of, or any other matter relating to, the accounts with account debtors; (b) notify all account debtors that the accounts have been assigned to Lender and that Lender has a Security Interest in the accounts; (c) take control in any manner of any cash or noncash items of payment or proceeds of the accounts; (d) in any case and for any reason, notify the United States Postal Service to change the addresses for delivery of mail addressed to Borrower to such address as Lender may designate; (e) in any case and for any reason, receive, open and dispose of all mail addressed to Borrower; and (f) upon demand for repayment of the Obligations or upon the occurrence of an Event of Default, as applicable, enforce payment of and collect any accounts, by legal proceedings or otherwise, and for such purpose Lender may: (i) demand payment of any accounts or instruct any account debtors to make payment of accounts directly to Lender (whether to a lockbox account or otherwise); (ii) receive and collect all monies due or to become due to Borrower; (iii) exercise all of Borrower’s rights and remedies with respect to the collection of the accounts; (iv) settle, adjust, compromise, extend, renew, discharge or release the accounts; (v) endorse the name of Borrower upon any chattel papers, documents, instruments, invoices, freight bills, bills of lading or similar documents or agreements relating to accounts or goods pertaining to accounts or upon any checks or other medium of payment or evidence of security interest that may come into Lender’s possession; (vi) sign the name of Borrower to verifications of accounts sent by account debtors to Borrower; or (vii) take all other actions necessary or desirable to protect Borrower’s interest(s) in the accounts.

 

Borrower irrevocably authorizes and directs each account debtor to honor any demand by Lender that all payments in respect of the accounts thereafter be paid directly to Lender. In each such case account debtor may continue directing all such payments to Lender until account debtor shall have received written notice from Lender either that the Obligations have been paid in full or that Lender has released its Security Interest. No account debtor shall have any responsibility to inquire into Lender’s right to make any such demand or to follow Lender’s disposition of any moneys paid to Lender by an account debtor.

 

Borrower further agrees to use its best efforts to assist Lender in the collection and enforcement of the accounts and will not hinder, delay or impede Lender in any manner in its collection and enforcement of the accounts.

 

Notwithstanding the foregoing, it is understood and agreed that any exercise of the authority under this section by Lender shall be on behalf of Lender and not on behalf of Borrower. Lender is not an agent or fiduciary of Borrower. However, in exercising the authorization granted hereby, Lender shall exercise reasonable caution and prudence, and Lender shall keep full and accurate record of all actions, receipts and disbursements.

 

7.      Verification and Further Assurances of Collateral. Lender shall have the right to verify all or any Collateral in any manner and through any medium Lender may consider appropriate, and Borrower agrees to furnish all assistance and information and perform any acts which Lender may reasonably require in connection therewith. Borrower will execute, acknowledge and deliver, or cause to be executed, acknowledged or delivered, all such further assurances and other agreements or instruments, and take or cause to be taken all such other actions, as Lender shall reasonably request from time to time to permit Lender to exercise the rights and remedies and have the benefit of the Liens granted to Lender under this Agreement and the other Loan Documents. 

 

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8.      Remedies Upon Events of Default. 

 

(a)     Collateral Repossession. Upon the occurrence of an Event of Default as set forth in the Loan Agreement, Lender’s rights and remedies with respect to the Collateral shall be those of a secured party under the Uniform Commercial Code and under any other applicable Law, as the same may from time to time be in effect, in addition to those rights granted herein and in any other agreement now or hereafter in effect between Borrower and Lender, including the other Loan Documents. Without in any way limiting the foregoing, Lender, upon the occurrence and during the continuance of an Event of Default, may at any time and from time to time, with or without judicial process, enter upon any premises in which any Collateral may be located and, without resistance or interference by Borrower, take possession of the Collateral; and/or dispose of any Collateral on any such premises; and/or require Borrower to assemble and make available to Lender at the expense of Borrower any Collateral at any place or time designated by Lender; and/or remove any Collateral from any such premises for the purpose of effecting sale or other disposition thereof. Borrower shall at Lender’s request instruct all suppliers, carriers, forwarders, warehousers or others receiving or holding Collateral to deliver same to Lender and/or subject to Lender’s order and if they shall come into any Loan Party’s possession, they, and each of them, shall be held by such Loan Party in trust as Lender’s trustee, and such Loan Party will immediately deliver them to Lender in their original form together with any necessary endorsement. In any public disposition, Lender reserves the right to credit bid. Lender may apply the net proceeds actually received from any sale or other disposition to the reasonable expenses of retaking, holding, preparing for sale, selling, leasing and the like, to reasonable attorney’s fees and all legal, travel and other expenses incurred by Lender in attempting to collect any part of the Obligations or enforcing this Agreement; and then to the Obligations in such order of application as Lender may elect; and Borrower shall remain liable and will pay to Lender on demand the amount of any deficiency remaining, together with interest thereon at the highest rate then payable on the Obligations.

 

(b)     Notice of Repossession. Without in any way requiring notice to be given in the following manner, Borrower agrees that any notice by Lender of sale, disposition or other intended action hereunder or in connection herewith, whether required by the Uniform Commercial Code or otherwise, shall constitute reasonable notice to Borrower if such notice is mailed by regular mail, postage prepaid, at least ten (10) days prior to such action, to the address set forth above as the location of Borrower’s chief executive office or to any other address which Borrower has specified in writing to Lender as the address to which notices hereunder shall be given to Borrower, including as set forth in the Loan Agreement.

 

(c)     Payments and Proceeds from Collateral. Lender may notify Borrower in writing, at any time after the occurrence of an Event of Default, and without waiving in any manner the Security Interest, that any payments on account of and proceeds from the Collateral received by Borrower (i) shall be held by Borrower in trust for Lender in the same medium in which received, (ii) shall not be commingled with any assets of Borrower, and (iii) shall be turned over to Lender not later than the next business day following the day of their receipt.

 

(d)     Costs and Expenses. Borrower agrees to pay on demand all reasonable costs and expenses incurred by Lender in enforcing this Agreement, in realizing upon or protecting any Collateral and in enforcing and collecting any Obligations or any guaranty thereof, including, without limitation, if Lender retains counsel for advice, suit, insolvency proceedings or any of the above purposes, the reasonable counsel’s fees and expenses incurred by Lender.

 

9.      Miscellaneous.

 

(e)     Power of Attorney. Borrower hereby makes, constitutes and appoints Lender (with full power of substitution) its true and lawful attorney in fact to act, with full power of substitution, with respect to the Collateral in any transaction, legal proceeding, or other matter in which Lender is acting pursuant to this Agreement. Borrower hereby authorizes Lender with power of substitution and without further authorization from Borrower, to execute, authenticate and/or file on its behalf: (i) UCC financing statements reflecting the Lien of Lender upon the Collateral and any other documents necessary or desirable to perfect or otherwise continue the Security Interest granted herein; (ii) any third party agreements or assignments to grant Lender control over the Collateral, including but not limited to third party agreements between Borrower, Lender, and depository institutions, securities intermediaries, and issuers of letters of credit or other support obligations, which third party agreements direct the third party to accept direction from Lender regarding the maintenance and disposition of the Collateral and the products and proceeds thereof; and (iii) filings in the appropriate jurisdictions with appropriate governmental authorities to create and perfect the Security Interests and Liens in favor of Lender and have the same noted on any certificate of title for each item of Collateral covered by a certificate of title. Upon demand or the occurrence and during the continuance of an Event of Default, Borrower authorizes Lender (A) to make, adjust or settle and receive payment on any insurance claims with respect to the Collateral; (B) to endorse the name of Borrower on any instruments, documents or other evidences of the Collateral that may come into Lender’s possession; (C) to execute proofs of claim and loss or similar documents; (D) to execute endorsements, assignments or other instruments of sale, conveyance or transfer for any Collateral; (E) to transfer or cause to be transferred into Lender’s name, or the name of its nominee or nominees, any or all of the Collateral; and (F) to perform all other acts which Lender deems appropriate to protect and preserve the Collateral and to enforce the terms of this Agreement. It is understood and agreed that any exercise of this authorization by Lender shall be on behalf of Lender and not on behalf of Borrower. Lender is not an agent or fiduciary of Borrower. However, in exercising the authorization granted hereby, Lender shall exercise reasonable caution and prudence, and Lender shall keep full and accurate record of all actions, receipts and disbursements. This authorization is unconditional and irrevocable until the Obligations are paid in full and Borrower shall have performed all of its obligations under this Agreement. Borrower also ratifies its authorization for Lender to have filed any UCC financings statements or amendments thereto if filed prior to the date hereof. 

 

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(f)     Lender’s Performance on Borrower’s Behalf. Upon Borrower’s failure to perform any of its covenants or obligations hereunder, Lender may, but shall not be obligated to, perform any or all such covenants or obligations, and Borrower shall pay an amount equal to the expense thereof to Lender upon demand by Lender, and all such amounts shall become part of the Obligations secured hereby.

 

(g)     No Waiver of Remedies. No course of dealing and no delay or omission by Lender in exercising any right or remedy hereunder or with respect to any Obligations shall operate as a waiver thereof or of any other right or remedy, and no single or partial exercise thereof shall preclude any other or further exercise thereof or the exercise of any other right or remedy. Lender may remedy any default by Borrower hereunder or with respect to any Obligations in any reasonable manner without waiving the default remedied and without waiving any other prior or subsequent default by Borrower. All rights and remedies of Lender hereunder are cumulative, and are in addition to any and all rights and remedies available to Lender under the Uniform Commercial Code and other applicable law in effect from time to time.

 

(h)     Preservation of Collateral. Lender shall have no obligation to take, and Borrower shall have the sole responsibility for taking, any and all steps to preserve rights against any and all prior parties to any instrument or chattel paper constituting Collateral whether or not in Lender’s possession. Lender shall not be responsible to Borrower for loss or damage resulting from Lender’s failure to enforce or collect any Collateral or to collect any moneys due or to become due thereunder. Borrower waives protest of any instrument constituting Collateral at any time held by Lender on which Borrower is in any way liable and waives notice of any other action taken by Lender.

 

(i)     Setoff. Upon and at any time and from time to time after any occurrence or existence of any Event of Default, Lender shall have the right to place an administrative hold on, and setoff against each obligation of Borrower pursuant to this Agreement, each obligation of Lender or any affiliate of Lender (in any capacity) owing to Borrower, whether now existing or hereafter arising or accruing, whether or not then due and whether pursuant to any deposit account or certificate of deposit or in any other manner. Such setoff shall become effective at the time Lender determines even though evidence thereof is not entered in the records of Lender until later. 

 

(j)     Successors and Assigns. The rights and benefits of Lender hereunder shall, if Lender so agrees, inure to any party acquiring any interest in the Obligations or any part thereof. Borrower shall include its heirs, executors or administrators, or permitted successors or assigns. Lender shall include its successors or assigns.

 

(k)     Severability. Whenever possible, each provision of this Agreement shall be interpreted in such manner as to be effective and valid under applicable law. If, however, any such provision shall be prohibited by or invalid under such law, it shall be deemed modified to conform to the minimum requirements of such law, or, if for any reason it is not deemed so modified, it shall be prohibited or invalid only to the extent of such prohibition or invalidity without the remainder thereof or any other such provision being prohibited or invalid.

 

(l)     Amendments and Waivers. No modification, rescission, waiver, release or amendment of any provision of this Agreement shall be binding except by a written agreement subscribed by Borrower and by a duly authorized officer of Lender.

 

(m)    Suretyship Waivers. Borrower waives demand, notice, protest, notice of acceptance of this Agreement, notice of loans made, credit extended, Collateral received or delivered or other action taken in reliance hereon and all other demands and notices of any description. With respect to both the Obligations and the Collateral, Borrower assents to any extension or postponement of the time of payment or any other indulgence, to any substitution, exchange or release of or failure to perfect any security interest in any Collateral, to the addition or release of any party or person primarily or secondarily liable, to the acceptance of partial payment thereon and the settlement, compromising or adjusting of any thereof, all in such manner and at such time or times as Lender may deem advisable. Lender shall have no duty as to the collection or protection of the Collateral or any income therefrom, the preservation of rights against prior parties, or the preservation of any rights pertaining thereto. Borrower further waives any and all other suretyship defenses.

 

(n)     Governing Law. This Agreement and the transaction evidenced hereby shall be construed under the laws of the Commonwealth of Pennsylvania as the same may from time to time be in effect. All terms defined in the Uniform Commercial Code, unless otherwise defined in this Agreement or in any financing statement, shall have the definitions set forth in the Uniform Commercial Code adopted in the Commonwealth of Pennsylvania, as in effect on the date of this Agreement and as the same may be amended, modified or supplemented from time to time. 

 

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(o)     Term. This Agreement is and is intended to be a continuing Security Agreement and shall remain in full force and effect until all of the Obligations and any extensions or renewals thereof shall be paid in full.

 

(p)     Limitation of Liability. To the fullest extent permitted by applicable law, Borrower shall not assert, and hereby waives any claim against Lender, on any theory of liability, for special, indirect, consequential or punitive damages (but excluding direct or actual damages) arising out of, in connection with or as a result of, this Agreement, any related loan documents, the transactions contemplated hereby or thereby or any loan or the use of the proceeds.

 

(q)     Counterparts. This Agreement may be executed in any number of counterparts and by the parties hereto on separate counterparts, each of which when so executed and delivered shall be an original, but all such counterparts shall together constitute one and the same agreement. Borrower agrees that in any legal proceeding, a copy of this Agreement kept in Lender’s course of business may be admitted into evidence as an original.

 

(r)     Notices. Any notices under or pursuant to this Agreement shall be given in accordance with the Loan Agreement.

 

(s)     Venue. BORROWER KNOWINGLY, VOLUNTARILY, INTENTIONALLY AND IRREVOCABLY (i) CONSENTS IN EACH ACTION AND OTHER LEGAL PROCEEDING COMMENCED BY LENDER AND ARISING OUT OF OR OTHERWISE RELATING TO THIS AGREEMENT, ANY OF THE OBLIGATIONS, ANY OF THE COLLATERAL OR ANY OTHER COLLATERAL TO THE JURISDICTION OF ANY COURT THAT IS EITHER A COURT OF RECORD OF THE COMMONWEALTH OF PENNSYLVANIA OR A COURT OF THE UNITED STATES LOCATED IN THE COMMONWEALTH OF PENNSYLVANIA, AND (ii) WAIVES EACH OBJECTION TO THE LAYING OF VENUE OF ANY SUCH ACTION OR OTHER LEGAL PROCEEDING.

 

(t)     Waiver of Jury Trial. BORROWER KNOWINGLY, VOLUNTARILY, INTENTIONALLY AND IRREVOCABLY WAIVES EACH RIGHT BORROWER MAY HAVE TO A TRIAL BY JURY WITH RESPECT TO, AND IN, ANY ACTION OR OTHER LEGAL PROCEEDING OF ANY NATURE, RELATING TO (i) THIS AGREEMENT, ANY RELATED LOAN DOCUMENT OR ANY COLLATERAL, (ii) ANY TRANSACTION CONTEMPLATED BY ANY SUCH DOCUMENT, OR (iii) ANY NEGOTIATION, PERFORMANCE OR ENFORCEMENT OF THIS AGREEMENT, OR ANY COLLATERAL. BORROWER ACKNOWLEDGES THAT IT HAS BEEN REPRESENTED BY INDEPENDENT LEGAL COUNSEL AS NECESSARY AND APPROPRIATE.

 

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IN WITNESS WHEREOF, and intending to be legally bound hereby, Borrower has executed this Security Agreement by its duly authorized officers as of the date set forth above.

 

 

	 	
			SAKER AVIATION SERVICES, INC.

			 

			 

			 

			By: __________________________________________________________

			Name:  _______________________________________________________

			Title:  ________________________________________________________

			

 

 

 

03/12/2018 28995077

 

 

 

 

[SIGNATURE PAGE TO SECURITY AGREEMENT]

 

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SCHEDULE A

 

Locations at which Borrower’s business is conducted and at which the Collateral and records concerning Collateral are located:

 

 

 

	
			Address

				 	 
	
			20 South Street, Pier 6 East River, New York, NY

			10004

				 	 
	
			Such other locations (leased or owned) as disclosed

			to Lender from time to time under the Loan

			Agreement

				 	 

 

 

 

 

“Permitted Liens” as used in this Agreement means:

 

 

	
			Name of Lienholder

				
			Collateral

				
			Lien Position

			
	
			NoneExhibit 10.1

 

EMPLOYMENT
AGREEMENT

 

THIS
AGREEMENT (this “Agreement”), dated March 19, 2018 (the “Effective Date”), by and between
BOXLIGHT CORPORATION, a Nevada corporation (the “Corporation”) and TAKESHA BROWN, an individual
residing at 1076 Garner Creek Drive SW, Lilburn, GA 30047 (the “CFO”).

 

W
I T N E S S E T H:

 

NOW,
THEREFORE, in consideration of the mutual covenants and agreements contained herein, the parties hereto intending to be bound
hereby, it is hereinafter agreed as follows:

 

1.
Term. The Corporation hereby employs the CFO, and the CFO hereby accepts employment, for term commencing on Effective Date
hereof and, subject to earlier termination as provided in Section 5 hereof, continuing for the period commencing on the
Effective Date through March 31, 2019 (the “Initial Term”); which Initial Term may be renewed or extended by
mutual agreement of the Corporation and the CFO (such Initial Term, as the same may be so renewed or extended, being hereinafter
sometimes called the “Term of Employment”). The CFO shall perform the services specified herein, all upon the
terms and conditions hereinafter stated. This Agreement may be extended only upon the written consent of the parties hereto.

 

2.
Duties and Responsibilities.

 

General.
The CFO shall serve as the CFO of the Corporation and subject to the general direction and control of the Board of Directors of
the Corporation (the “Board of Directors”) the Executive shall have responsibility for the overall day-to-day
operation of the Corporation. In addition, the CFO shall have such other duties as are normally associated with and inherent in
the executive capacity in which the CFO will be serving.

 

a.
Time. The CFO shall devote her professional and business time, attention and energy to the Business (as defined herein)
of the Corporation as necessary and appropriate to meet the requirements directed by the CEO and further the interests of the
Corporation. As used herein, the term “Business” shall mean and include the development and selling of education
products and services. The Company understands CFO may have other investments and interests that do not compete with the Corporation.

 

c.
Business Opportunities. The CFO covenants and agrees that if, during the Term of Employment, the CFO shall access an
investment or business opportunity that is directly related to the Business of the Corporation (a “Business Opportunity”),
the CFO shall submit full details of such Business Opportunity to the CEO of the Corporation, and such Business Opportunity shall
be the sole property of the Corporation. The CFO and companies affiliated with the CFO agree not to engage in any business activities
that directly competes with the Corporation.

 

    	 	 	 

     

    

 

3.
Salary and Bonus.

 

a.
Base Salary. During the period commencing on the Effective Date and ending December 31, 2020, the Corporation shall pay
to the CFO a salary (the “Base Salary”) at an annual rate of One Hundred and Sixty-Five Thousand ($165,000)
Dollars.

 

b.
Bonuses. During the Term of Employment, the CEO shall evaluate the performance of the Executive and, if deemed appropriate
by the CEO, the Executive shall be awarded each quarter a cash bonus in the amount of Twelve Thousand Five Hundred Dollars ($12,500),
beginning on the quarter ending June 30, 2018.

 

4.
Incentive Awards and Fringe Benefits.

 

a.
Stock Options. In addition to (and not in lieu of) the Base Salary, the Corporation shall grant to the CFO employee
stock options (vesting in equal monthly installments over a one-year period, commencing on March 19, 2018 (the “Grant
Date”)), entitling the CFO to purchase shares of Common Stock of the Corporation which shall represent Thirty Five Thousand
(35,000) shares, pursuant to the Corporation’s 2014 Stock Incentive Plan (the “2014 Plan”), with a twelve-month
vesting schedule. Upon termination, the CFO shall have one year from the termination date to exercise any vested options.

 

b.
Benefit Plans. In addition to the other compensation payable to the CFO hereunder, and except as otherwise set forth
herein, the CFO shall be eligible to participate in all pension, profit sharing, retirement savings plan, 401K or other similar
benefit, medical, disability and other employee benefit plans and programs generally provided by the Corporation to its senior
staff from time to time hereafter (other than those provided pursuant to separately negotiated individual employment agreements
or arrangements), subject to, and to the extent the CFO is eligible for the respective terms of such benefit plans and programs.

 

c.
Expenses. During the Term of Employment, the Corporation shall pay or reimburse the CFO, upon submission of appropriate
documentation by her, for all out-of-pocket expenses for entertainment, travel, meals, hotel accommodations, subscription services,
event fees, office expenses, and the like incurred by her in the interest of the Business.

 

d.
Vacation. The CFO shall be entitled to five (5) weeks annual paid vacation days and twelve (12) paid holidays per calendar
year in accordance with Corporation policies.

 

e.
Insurance. During the Term of Employment, the Executive shall be entitled to participate in any group insurance plan,
including health insurance, term life insurance, and disability insurance policies (collectively, “Corporation Plans”)
from time to time maintained by the Corporation; provided that such insurance can be obtained on economically reasonable terms.
The Corporation agrees to pay or reimburse the full amount of CFO’s premiums for disability, accident, death and dismemberment
and/or life insurance coverage in the Corporation Plans. Should the Corporation not have an applicable Corporation Plan, the CFO
shall be reimbursed for any economically reasonable health and welfare insurance premiums paid by the CFO.

 

    	 	-2-	 

     

    

 

f.
Continuing Education. The Corporation shall pay for continuing education expenses as selected by the CFO subject to
an annual limit of $5,000. Attendance of such continuing education, not to exceed 5 business days, shall not constitute vacation
time.

 

5.
Termination; Change of Control.

 

a.
Death. If the CFO shall die prior to the expiration of the Term of Employment, the Corporation shall have no further
obligation hereunder, other than to the CFO or her estate except to pay to the CFO’s estate the amount of the CFO’s
Base Salary accrued to the date of her death. Such payment shall be made promptly after the date of death to the CFO’s estate.

 

b.
Disability. If prior to the expiration of the Term of Employment, the CFO shall be prevented, during a continuous period
of ninety (90) days (the “Disability Period”), from performing her duties by reason of “disability,”
the Corporation may terminate this Agreement, in which event the CFO shall receive: (i) her Base Salary accrued to the date upon
which any determination of disability shall have been made as hereinafter provided, and continuing until the date on which disability
income payments commence under the Company’s long term disability plan (or the beginning of Social Security disability income,
if sooner), which Base Salary payment may be reduced by the amount of any disability income payments the CFO may receive in connection
with such occurrence of disability during the Disability Period under any policy or plan carried or maintained by the Corporation
and under which the CFO is a beneficiary or participant. The CFO shall continue to have the right to receive the greater of her
Current Benefits, or benefits, if any, under any Corporation Plans, but only in accordance with the terms of such plan or policy
as they apply to persons whose employment has been terminated as a result of an employee’s permanent disability. Such payments
shall be made to the CFO in accordance with its normal payroll policies and schedule.

 

For
purposes of this Agreement, the CFO shall be deemed to have become disabled when the Corporation, upon the diagnosis of a reputable,
licensed physician of the Corporation’s choice, in consultation with the CFO’s primary physician, shall have determined
that the CFO shall have become unable to perform her duties under this Agreement, whether due to physical or mental incapacity
or to infirmity caused by chronic alcoholism or drug use (excluding infrequent and temporary absences due to ordinary illness);
provided that such incapacity shall have continued uninterrupted for a period of not less than ninety (90) days.

 

c.
Cause. Notwithstanding any other provision of this Agreement, if prior to the expiration of the Term of Employment,
the Corporation shall have the right to discharge the CFO “for Cause,” as defined below, then this Agreement shall
terminate effective upon such discharge, and upon such termination, neither the Corporation nor any other member of the Corporation
shall have any further obligation to the CFO or her estate, except that the Corporation will cause the Corporation to pay to the
CFO, within thirty (30) days of such termination, or in the event of her subsequent death, her estate, an amount equal to the
CFO’s Base Salary, as provided in Section 3 hereof, accrued to the date of termination. In addition, the CFO shall
not, after the date of termination, be entitled to receive any further Current Benefits, or other benefits, if any, under any
Corporation Plans. In the event of termination of the CFO’s employment for Cause, neither the Corporation nor any member
of the Corporation shall be obligated to pay, and the CFO shall not be entitled to receive, any Bonus.

 

    	 	-3-	 

     

    

 

For
the purposes hereof, the term “Cause” shall mean and be limited to a discharge resulting from any one of the
following:

 

(i)
the CFO’s conviction of a felony or any other crime involving moral turpitude,

 

(ii)
a breach by the CFO of her fiduciary duties to the Corporation as specified herein, or

 

(iii)
the CFO’s failure or refusal to follow the lawful polices or directives established by the CEO; provided that in the case
of clauses (ii) or (iii) above, the CEO shall have first given written notice thereof to the CFO on each occasion describing in
reasonable detail of the alleged breach, failure or refusal, and such breach or willful failure or refusal to follow written lawful
policies or directives shall remain uncured for a period of thirty (30) days following receipt of each such notice.

 

d.
Termination Without Cause. Notwithstanding anything to the contrary, express or implied, contained in this Agreement,
the Corporation may terminate the employment of the CFO at any time without Cause (a “Non-Cause Termination”);
provided that the Corporation shall pay to the CFO severance pay equal to Twelve (12) months of the Base Salary then in effect
(the “Severance Payment”), payable in equal monthly installments over the twelve-month period following such
Non-Cause Termination.

 

e.
Other Reasons for Termination.

 

The
CFO may terminate this Agreement prior to the end of the Term of Employment either (A) upon thirty (30) days written notice with
Good Reason (“Termination with Good Reason”), or (B) for any or no reason by providing three (3) months’
advance written notice is given by the CFO to the Corporation.

 

As
used herein, the term “Termination for Good Reason” shall mean: (a) a material reduction in the scope of the
CFO’s title, authority, duties or responsibilities in effect as of the Effective Date, which reduction is not remedied by
the Corporation within thirty (30) days after notification to the Corporation containing a reasonably detailed description of
such reduction; (b) the Corporation’s breach of any material obligation owed to the CFO under this Agreement, including
any Base Salary or; provided that the CFO has given the Corporation notice thereof describing in reasonable detail the alleged
breach or failure, and the Corporation has failed to cure such breach or failure within a period of thirty (30) days following
receipt of such notice.

 

    	 	-4-	 

     

    

 

In
the event of a Termination Without Cause initiated by the CFO, the Corporation shall pay to the CFO, or in the event of his death,
to his estate, the amount of the CFO’s Base Salary accrued to the date of termination. In the event of a Termination With
Good Reason initiated by the CFO, the Corporation shall additionally pay to the CFO one full year’s Base Salary. The amounts
set forth in this Section 5e shall be paid in full within thirty (30) days of the date of termination of employment.

 

f.
Public Notice.

 

The
Corporation and CFO shall mutually agree on any public communications regarding the cancellation of this Agreement by either party.
Neither party shall defame, disparage or denigrate the other in public statements.

 

6.
Certain Covenants of the CFO.

 

a.
Confidential Information. The CFO acknowledges that in the course of his employment with the Corporation she may receive
certain information, knowledge and data concerning the Business of the Corporation and its affiliates or pertaining to any individual,
firm, corporation, partnership, joint venture, business, organization, entity or other person which the Corporation may do business
with during the Term of Employment, which is not in the public domain, including but not limited to trade secrets, employee records,
names and lists of suppliers and customers, programs, statistics, processes, techniques, pricing, marketing, software and designs,
or any other matters, and all other confidential information of the Corporation and its and affiliates acquired in connection
with your employment (hereinafter referred to collectively as “Confidential Information”), which the Corporation
and its affiliates desire to protect. The CFO understands that such Confidential Information is confidential, and she agrees not
to reveal or disclose or otherwise make accessible such Confidential Information to anyone outside of the Corporation or any affiliate
and their respective officers, employees, directors, consultants or agents, so long as the confidential or secret nature of such
Confidential Information shall continue, whether or not he is employed by the Corporation, except as may be required by law, regulation
or court order.

 

b.
Return of Information. At such time as the CFO shall cease to be employed by the Corporation or the Corporation for
whatever reason or at any other time the Corporation may reasonably request, he shall promptly deliver and surrender to the Corporation
all papers, memoranda, notes, records, reports, sketches, specifications, designs and other documents, writings (and all copies
thereof), and other property produced by her or coming into her possession by or through her employment hereunder and relating
to the Confidential Information referred to in this Section 6 or otherwise to the Business, and the CFO agrees that all
such materials will at all times remain the property of the Corporation.

 

    	 	-5-	 

     

    

 

c.
Non-Competition Agreement. CFO acknowledges that the agreements and covenants contained in this Section 6(c) are essential
to protect the business, goodwill, trade secrets and confidential information of the Corporation and are appropriate in scope
and the Business is conducted in the United States (the “Territory”). CFO covenants and agrees that during
the period commencing on the Effective Date and ending on the earlier of the CFO’s termination of employment for Good Reason
or the second (2nd) anniversary following CFO’s termination of employment by the Company Without Cause or by
the CFO without Good Reason (the “Restricted Period”), CFO shall not, directly or indirectly, (i) engage in
any related business activity in the Territory that competes with the Business; (ii) render any services to any person for use
in competing with the Corporation in connection with the Business in the Territory; or (iii) have an interest in any person engaged
in any business that competes with the Corporation in connection with the Business in the Territory, directly or indirectly, in
any capacity, including as a partner, member, officer, director, manger, principal, agent, trustee or consultant or any other
relationship or capacity; provided, however, that each Restricted Party may own, directly or indirectly, solely as an investment,
securities of any Person which are publicly traded if such Restricted Party (A) is not a controlling person of, or a member of
a group which controls, such person and (B) does not, directly or indirectly, own 5% or more of any class of securities of such
Person; or (iv) interfere with business relationships (whether formed heretofore or hereafter) between Buyer or any of its Affiliates
and customers, suppliers or prospects of the Business.

 

d.
Agreement Not to Solicit. For so long as the CFO shall be employed with the Corporation and for a period of two (2) years
following the termination of this Agreement for any reason, the CFO agrees that she will not, either directly or indirectly, through
any person, firm, association, corporation, partnership, agency or other business entity or person with which he is now or may
hereafter become associated, (i) cause or induce any present or future employee of the Corporation to leave the employ of the
Corporation or any affiliate to accept employment with the CFO or with such person, firm, association or corporation, agency or
other business entity or (ii) solicit any person or entity which is a customer of the Corporation for the purpose of directly
or indirectly furnishing services competitive with the Corporation.

 

e.
Scope. It is expressly agreed that if any restrictions set forth in this Section 6 are found by any court having
jurisdiction to be unreasonable because they are too broad in any respect, then and in each such case, the remaining restrictions
herein contained shall, nevertheless, remain effective, and this Agreement, or any portion thereof, shall be considered to be
amended so as to be considered reasonable and enforceable by such court, and the court shall specifically have the right to restrict
the business or geographical scope of such restrictions to any portion of the business or geographic areas described above to
the extent the court deems such restriction to be necessary to cause the covenants to be enforceable, and in such event, the covenants
shall be enforced to the extent so permitted.

 

f.
Specific Performance. The CFO acknowledges that a remedy at law for any breach or attempted breach of Section 6
of this Agreement may be inadequate, agrees that the Corporation shall be entitled to seek specific performance and injunctive
and other equitable relief in case of any such breach or attempted breach, and further agrees to waive any requirement for the
securing or posting of any bond in connection with the obtaining of any such injunctive or any other equitable relief.

 

    	 	-6-	 

     

    

 

7.
Indemnification. Throughout the Term of Employment, the Corporation hereby agrees to maintain officers and directors’
liability insurance with one or more recognized insurance carriers in an amount of not less than Five Million ($5,000,000) and
to cover the CFO under all of such policies and to provide indemnity to the CFO, in his capacity described in this Agreement,
to the fullest extent provided under Georgia Law as provided herein. In addition, throughout the Term of Employment, the Corporation
hereby agrees to agree to indemnify, defend and hold harmless the CFO and his Affiliates and, if applicable, the directors, officers,
shareholders, employees, attorneys, accountants, agents and representatives of any affiliate of the CFO and the heirs, successors
and assigns of the CFO or his affiliates (collectively, the “Indemnified Parties”) to the fullest extent permitted
under Georgia law, from and against any and all claims, liabilities, costs, expenses, including without limitation the payment
by the Corporation of all legal fees, court costs and filing fees, as incurred by the CFO (collectively, “Claims”),
based upon, arising out of or otherwise in respect of (i) any act of omission or commission by the Corporation or its board of
directors, (ii) the failure of the Corporation to perform or observe fully any covenant, agreement or provision to be performed
or observed by the Corporation to any third party, or (iii) any third-party Claim arising out of or in connection with the operation
of the Business of the Corporation.

 

8.
Severability. In case of any term, phrase, clause, Section, section, restriction, covenant, or agreement contained in this
Agreement shall be held to be invalid or unenforceable, the same shall be deemed, and it is hereby agreed that the same are meant
to be several, and shall not defeat or impair the remaining provisions hereof.

 

9.
Waiver. The waiver by the Corporation of a breach of any provision of this Agreement by the CFO shall not operate or be
construed as a waiver of any subsequent or continuing breach of this Agreement by the CFO.

 

10.
Assignment; Binding Affect. This Agreement may not be assigned under any circumstances by either party. Neither the CFO nor
her estate shall have any right to commute, encumber or dispose any rights to receive payments hereunder, it being agreed that
such payment and the right thereto are nonassignable and nontransferable. Subject to the provisions of this Section 9 this
Agreement shall be binding upon and inure to the benefit of the parties hereto, the CFO’s heirs and personal representatives,
and the successors and assigns of the Corporation.

 

11.
Amendments. This Agreement may not be changed, amended, terminated or superseded orally, but only by an agreement in writing,
nor may any of the provisions hereof be waived orally, but only by an instrument in writing, in any such case signed by the party
against whom enforcement of any change, amendment, termination, waiver, modification, extension or discharge is sought.

 

    	 	-7-	 

     

    

 

12.
Entire Agreement; Amendment; Governing Law. This Agreement embodies the entire agreement and understanding between the parties
hereto with respect to the matters covered hereby. Only an instrument in writing executed by the parties hereto may amend this
Agreement.

 

13.
Governing Law; Jurisdiction. This Agreement shall be governed by and construed in accordance with the laws of the State of
Georgia. All actions and proceedings arising out of or relating to this Agreement shall be brought by the parties and heard and
determined only in a Federal or state court located in the City of Atlanta and State of Georgia and the parties hereto consent
to jurisdiction before and waive any objections to the venue of such Federal and New York courts. The parties hereto agree to
accept service of process in connection with any such action or proceeding in any manner permitted for a notice hereunder.

 

14.
Attorneys’ Fees. Except as otherwise provided in Section 7 above, in the event that any suit or other legal proceeding
is brought for the enforcement of any of the provisions of this Agreement, the parties hereto agree that the prevailing party
or parties shall be entitled to recover from the other party or parties upon final judgment on the merits reasonable attorneys’
fees, including attorneys’ fees for any appeal and costs incurred in bringing such suit or proceeding.

 

15.
Headings. All descriptive headings of the several Sections or Sections of this Agreement are inserted for convenience only
and do not constitute a part of this Agreement.

 

16.
Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and same instrument. Facsimile and pdf signatures hereto shall have the same validity as original
signatures hereto.

 

17.
Representations and Warranties. (a) CFO represents and warrants to Corporation that (i) CFO is under no contractual or other
restriction or obligation which is inconsistent with his execution of this Agreement or performance of her duties hereunder, (ii)
CFO has no physical or mental disability that would hinder her performance of her duties under this Agreement, and (iii) she has
had the opportunity to consult with an attorney of his choosing in connection with the negotiation of this Agreement.

 

18.
Notices. Any notice required or permitted to be given under this Agreement shall be in writing and shall be sent by certified
mail, by personal delivery or by overnight courier to the CFO at her residence (as set forth in Corporation’s corporate
records) or to the Corporation at its principal office and shall be effective upon receipt, if by personal delivery, three (3)
business days after mailing, if sent by certified mail or one (1) business day after deposit with an overnight courier.

 

[SIGNATURE
PAGE FOLLOWS]

 

    	 	-8-	 

     

    

 

IN
WITNESS WHEREOF, the parties hereto have executed this agreement as of the date and year first above written.

 

	 	CORPORATION:
	 	 	 
	 	BOXLIGHT
    CORPORATION
	 	 	 
	 	By:
    	 
	 	Name:	Mark
    Elliott
	 	Title:	CEO
	 	 	 
	 	CFO:
	 	 	 
	 	 
	 	TAKESHA BROWN

 

    	 	-9-

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