Document:

Consent, Waiver, and Fourteenth Amendment to Loan and Security Agreement

 Exhibit 10.18 
 CONSENT, WAIVER AND FOURTEENTH AMENDMENT TO 
 LOAN AND SECURITY AGREEMENT 
 THIS CONSENT, WAIVER AND FOURTEENTH AMENDMENT TO LOAN AND SECURITY AGREEMENT (this “Amendment”) is entered into as of April 20, 2007 by
and among TELOS CORPORATION, a Maryland corporation (“Parent”), XACTA CORPORATION, a Delaware corporation (“Xacta”; Parent and Xacta are referred to hereinafter each individually as a “Borrower”, and
individually and collectively, jointly and severally, as the “Borrowers”), TELOS DELAWARE, INC., a Delaware corporation (“Telos-Delaware”), UBIQUITY.COM, INC., a Delaware corporation (“Ubiquity”),
TELOS.COM, INC., a Delaware corporation (“Telos.com”), TELOS INTERNATIONAL CORP., a Delaware corporation (“TIC”), TELOS INTERNATIONAL ASIA, INC., a Delaware corporation (“TIA”), SECURE TRADE,
INC., a Delaware corporation (“STI”), KUWAIT INTERNATIONAL, INC., a Delaware corporation (“KII”), TELOS INFORMATION SYSTEMS, INC., a Delaware corporation (“TIS”), TELOS FIELD ENGINEERING, INC.,
a Delaware corporation (“TFE”), and TELOS FEDERAL SYSTEMS, INC., a Delaware corporation (“TFS”; Telos-Delaware, Ubiquity, Telos.com, TIC, TIA, STI, KII, TIS, TFE and TFS are referred to hereinafter each individually as a
“Credit Party” and collectively, jointly and severally, as the “Credit Parties”), and WELLS FARGO FOOTHILL, INC. (formerly known as Foothill Capital Corporation), as agent (“Agent”) for the Lenders (defined
below) and as a Lender. 
 WHEREAS, Borrowers, Credit Parties, Agent and certain other financial institutions from time to time party thereto
(the “Lenders”) are parties to that certain Loan and Security Agreement dated as of October 21, 2002 (as amended from time to time, the “Loan Agreement”); 
 WHEREAS, the Companies (A) failed to deliver to Agent (x) the audited financial statements for the fiscal year ended December 31, 2006
required by Section 6.3(b) and (y) the Compliance Certificates for each of the months ended January 31, 2007 and February 28, 2007 required by Section 6.3(a), which resulted in Events of Default under Section 8.2 of the
Loan Agreement and (B) failed to have the minimum Sales for each of the 5 week periods ending June 2, 2006, June 9, 2006 and June 16, 2006 as required by Section 7.20(a)(iii) of the Loan Agreement, which resulted in
Events of Default under Section 8.2 of the Loan Agreement (all of the foregoing, collectively, the “Existing Defaults”); and 
 WHEREAS, Borrowers have notified Agent that Parent desires to form a new Subsidiary (“New Subsidiary”) and contribute the assets described on Exhibit A hereto relating to its identity management business to the New
Subsidiary in exchange for 99.999% of the membership interests of the New Subsidiary, as set forth in greater detail in the Contribution Agreement attached hereto as Exhibit B (“Contribution Agreement”); 
 WHEREAS, Parent further desires to sell 39.999% of its membership interest in New Subsidiary to Hoya ID Fund A, LLC, a California limited liability
company (“Investor LLC”) for an aggregate purchase price of $6,000,000 (the “Sale of Interests”) pursuant to the Membership Interest Purchase & Assignment Agreement attached hereto as Exhibit C (the “Purchase
Agreement”); 

 WHEREAS, in connection with the Sale of Interests, the New Subsidiary desires to adopt the Amended and
Restated Operating Agreement attached hereto as Exhibit D (the “Operating Agreement”); 
 WHEREAS, absent the prior written
consent of Agent and the undersigned Lenders, (i) the formation of New Subsidiary and contribution of assets to New Subsidiary pursuant to the Contribution Agreement, (ii) the consummation of the Sale of Interests and (iii) the
adoption of the Operating Agreement (collectively, the transactions described in clauses (i), (ii) and (iii) above, the “Joint Venture Transaction”) would constitute a breach of Sections 7.4, 7.5 and
7.13 of the Loan Agreement, constituting separate Events of Default pursuant to Section 8.2(c) of the Loan Agreement, and Borrowers have requested that Agent and the Lenders consent to the consummation thereof so as to avoid any
such Events of Default; 
 WHEREAS, subject to the terms and conditions contained herein, Borrowers, Credit Parties, Agent and Lenders have
agreed to waive the Existing Defaults, consent to the Joint Venture Transaction and amend the Loan Agreement in certain respects. 
 NOW
THEREFORE, in consideration of the premises and mutual agreements herein contained, the parties hereto agree as follows: 
 1. Defined
Terms. Unless otherwise defined herein, capitalized terms used herein shall have the meanings ascribed to such terms in the Loan Agreement. 
 2. Waiver. Subject to the satisfaction of the conditions set forth in Section 6 hereof, Agent and the undersigned Lenders hereby waive the Existing Defaults. The foregoing waiver shall not constitute a waiver of any other Event
of Default that may exist, or a waiver of any future Event of Default that may occur. 
 3. Consent. Subject to the satisfaction of
the conditions set forth in Section 6 hereof, Agent and the undersigned Lenders hereby consent to the Joint Venture Transaction as such transaction is described in the Contribution Agreement, Purchase Agreement and Operating Agreement. Except
as expressly set forth in this Section 3, the foregoing consent shall not constitute a consent to any transaction other than the Joint Venture Transaction or a waiver of any Event of Default that may arise from any such transaction or the Joint
Venture Transaction. 
 4. Amendments to Loan Agreement. Subject to the satisfaction of the conditions set forth in Section 6
hereof, the Loan Agreement is amended in the following respects: 
 (a) The definition of “Availability Block” as set forth in
Section 1.1 of the Loan Agreement is amended and restated in its entirety, as follows: 
 “Availability
Block” means an amount equal to $500,000; provided, that Availability Block shall mean an amount equal to $0 for the period from October 27, 2006 through and including April 30, 2007. 
  

 -2- 

 (b) The definition of “EBITDA” as set forth in Section 1.1 of the Loan Agreement is
amended and restated in its entirety, as follows: 
 “EBITDA” means, with respect to any fiscal period,
Parent’s and its Subsidiaries’ consolidated net earnings (or loss), minus extraordinary gains, plus non-cash extraordinary losses, plus interest expense, income taxes, and depreciation and amortization for such period, as determined in
accordance with GAAP. Notwithstanding anything herein to the contrary, for purposes of the determination of EBITDA, TIMS LLC shall not be deemed to be a Subsidiary of Parent. 
 (c) The definition of “Permitted Investments” as set forth in Section 1.1 of the Loan Agreement is amended and restated in its entirety,
as follows: 
 “Permitted Investments” means (a) investments in Cash Equivalents, (b) investments
in negotiable instruments for collection, (c) advances made in connection with purchases of goods or services in the ordinary course of business, (d) investments by any Borrower in any other Borrower or any Credit Party provided that if
any such investment is in the form of Indebtedness, such Indebtedness investment shall be subject to the terms and conditions of the Intercompany Subordination Agreement and provided, further, that Borrowers may not invest more than $50,000 in the
aggregate in the Credit Parties and then only so long as the proceeds of such investments are used to facilitate the dissolution of such Credit Parties and (e) investments by Parent of up to $1,000,000 in the aggregate in TIMS LLC provided,
that investments pursuant to this clause (e) may only be made (i) during the period on or prior to October 20, 2007 and (ii) if Excess Availability after giving effect to such investment is equal to or greater than $1,000,000.

 (d) The following defined term is hereby added in Section 1.1 of the Loan Agreement in alphabetical order therein: 
 “TIMS LLC” means Telos Identity Management Solutions, LLC (d/b/a XACTA Identity Management Solutions), a Delaware limited
liability company. 
 (e) Section 7.20(a)(i) of the Loan Agreement is hereby amended and restated in its entirety as follows:

 (i) Minimum EBITDA. EBITDA, measured on a fiscal month-end basis, for each period set forth below, of not less than
the required amount set forth in the following table for the applicable period set forth opposite thereto; 
  

 -3- 

			
	 Applicable Amount
	  	 Applicable Period

	$(307,767)	  	For the 1 month period ending January 31, 2007
		
	$(295,624)	  	For the 2 month period ending February 28, 2007
		
	$(2,827,784)	  	For the 3 month period ending March 31, 2007
		
	$(5,031,612)	  	For the 4 month period ending April 30, 2007
		
	$(6,427,164)	  	For the 5 month period ending May 31, 2007
		
	$(6,232,277)	  	For the 6 month period ending June 30, 2007
		
	$(5,773,289)	  	For the 7 month period ending July 31, 2007
		
	$(4,460,556)	  	For the 8 month period ending August 30, 2007
		
	$(3,185,384)	  	For the 9 month period ending September 30, 2007
		
	$(211,780)	  	For the 10 month period ending October 31, 2007
		
	$1,741,025	  	For the 11 month period ending November 30, 2007
		
	$2,140,200	  	For the 12 month period ending December 31, 2007
		
	85% of EBITDA for such period as reflected in the most recent Projections delivered to Agent pursuant to Section 6.3(c) and approved by Required Lenders but in no event less than
$2,140,200	  	For the 12 month period ending January 31, 2008 and the 12 month period ending on the last day of each fiscal month thereafter

  

 -4- 

 5. Ratification; Other Agreements. This Amendment, subject to satisfaction of the conditions set
forth in Section 6 below, shall constitute a waiver and amendment to the Loan Agreement and all of the Loan Documents as appropriate to express the agreements contained herein. Except as specifically set forth herein, the Loan Agreement and the
Loan Documents shall remain unchanged and in full force and effect in accordance with their original terms. Notwithstanding anything in the Loan Agreement or any other Loan Document to the contrary, none of the Borrowers nor any other Credit Party
may make any Investment, or transfer funds or property to, or enter into any transaction with, Telos Identity Management Solutions, LLC (d/b/a XACTA Identity Management Solutions), a Delaware limited liability company (“TIMS LLC”) except
as expressly provided in this Amendment. Any breach of the foregoing covenant shall constitute an Event of Default. 
 6. Conditions to
Effectiveness. This Amendment shall become effective as of the date hereof upon the satisfaction of the following conditions precedent (provided, that the amendments set forth in Section 4 shall become effective retroactive to
January 1, 2007 upon the satisfaction of such conditions precedent): 
 (a) Each party hereto shall have executed and delivered this
Amendment to Agent; 
 (b) Agent shall have received the fee described in Section 7 hereof; 
 (c) Borrowers shall have delivered to Agent fully executed copies of all documents, agreements and instruments delivered in connection with the Joint
Venture Transaction; 
 (d) Borrowers shall have delivered to Agent such other documents, agreements and instruments as may be requested or
required by Agent in connection with this Amendment, each in form and content acceptable to Agent; 
 (e) The aggregate cash consideration
for the Sale of Interests shall be not less than $6,000,000 and such cash consideration shall be wire transferred directly to Agent for application to the Obligations in accordance with the terms of the Loan Agreement; 
 (f) No Default or Event of Default other than the Existing Defaults shall have occurred and be continuing on the date hereof or as of the date of the
effectiveness of this Amendment; and 
 (g) All proceedings taken in connection with the transactions contemplated by this Amendment and all
documents, instruments and other legal matters incident thereto shall be satisfactory to Agent and its legal counsel. 
 7. Amendment
Fee. To induce Agent and Lenders to enter into this Amendment, Borrowers shall pay to Agent, for the benefit of Lenders, a non-refundable additional amendment fee equal to $150,000, which shall be due and payable on the date hereof. 

 

 -5- 

 8. Covenants. Companies agree to deliver to Agent, on or before April 30, 2007: 

(a) the audited financial statements for the fiscal year ended December 31, 2006 required by Section 6.3(b) of the Loan Agreement; and

 (b) a fully executed pledge agreement, in form and substance satisfactory to Agent, pursuant to which Parent shall have pledged and
granted to Agent, for its benefit and the benefit of Lenders, a security interest in all of its membership interests in the New Subsidiary. 
 Failure to
deliver to Agent the items set forth in (a) and (b) above on or prior to April 30, 2007 shall constitute an Event of Default. 
 9. Miscellaneous. 
 (a) Warranties and Absence of Defaults. To induce Agent and Lenders to enter into this Amendment,
each Company hereby represents and warrants to Agent and Lenders that: 
 (i) The execution, delivery and performance by it of
this Amendment and each of the other agreements, instruments and documents contemplated hereby are within its corporate power, have been duly authorized by all necessary corporate action, have received all necessary governmental approval (if any
shall be required), and do not and will not contravene or conflict with any provision of law applicable to it, its articles of incorporation and by-laws, any order, judgment or decree of any court or governmental agency, or any agreement, instrument
or document binding upon it or any of its property; 
 (ii) Each of the Loan Agreement and the other Loan Documents, as
amended by this Amendment, are the legal, valid and binding obligation of it enforceable against it in accordance with its terms, except as the enforcement thereof may be subject to (A) the effect of any applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting creditor’s rights generally, and (B) general principles of equity; 
 (iii) The representations and warranties contained in the Loan Agreement and the other Loan Documents are true and accurate as of the date hereof with the same force and effect as if such had been made on and as of the date hereof; and

 (iv) It has performed all of its obligations under the Loan Agreement and the Loan Documents to be performed by it on or
before the date hereof and as of the date hereof, it is in compliance with all applicable terms and provisions of the Loan Agreement and each of the Loan Documents to be observed and performed by it and no event of default or other event which upon
notice or lapse of time or both would constitute an event of default has occurred. 
  

 -6- 

 (b) Expenses. Companies, jointly and severally, agree to pay on demand all costs and expenses of
Agent (including the reasonable fees and expenses of outside counsel for Agent) in connection with the preparation, negotiation, execution, delivery and administration of this Amendment and all other instruments or documents provided for herein or
delivered or to be delivered hereunder or in connection herewith. In addition, Companies agree, jointly and severally, to pay, and save Agent harmless from all liability for, any stamp or other taxes which may be payable in connection with the
execution or delivery of this Amendment or the Loan Agreement, as amended hereby, and the execution and delivery of any instruments or documents provided for herein or delivered or to be delivered hereunder or in connection herewith. All obligations
provided herein shall survive any termination of the Loan Agreement as amended hereby. 
 (c) Governing Law. This Amendment shall be a
contract made under and governed by the internal laws of the State of Illinois. 
 (d) Counterparts. This Amendment may be executed in
any number of counterparts, and by the parties hereto on the same or separate counterparts, and each such counterpart, when executed and delivered, shall be deemed to be an original, but all such counterparts shall together constitute but one and
the same Amendment. 
 10. Release. 
 (a) In consideration of the agreements of Agent and Lenders contained herein and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, each Company, on behalf of
itself and its successors, assigns, and other legal representatives, hereby absolutely, unconditionally and irrevocably releases, remises and forever discharges Agent and Lenders, and their successors and assigns, and their present and former
shareholders, affiliates, subsidiaries, divisions, predecessors, directors, officers, attorneys, employees, agents and other representatives (Agent, each Lender and all such other Persons being hereinafter referred to collectively as the
“Releasees” and individually as a “Releasee”), of and from all demands, actions, causes of action, suits, covenants, contracts, controversies, agreements, promises, sums of money, accounts, bills, reckonings, damages and any and
all other claims, counterclaims, defenses, rights of set-off, demands and liabilities whatsoever (individually, a “Claim” and collectively, “Claims”) of every name and nature, known or unknown, suspected or unsuspected, both at
law and in equity, which such Company or any of its successors, assigns, or other legal representatives may now or hereafter own, hold, have or claim to have against the Releasees or any of them for, upon, or by reason of any circumstance, action,
cause or thing whatsoever which arises at any time on or prior to the day and date of this Amendment, including, without limitation, for or on account of, or in relation to, or in any way in connection with any of the Loan Agreement, or any of the
other Loan Documents or transactions thereunder or related thereto. 
 (b) Each Company understands, acknowledges and agrees that the release
set forth above may be pleaded as a full and complete defense and may be used as a basis for an injunction against any action, suit or other proceeding which may be instituted, prosecuted or attempted in breach of the provisions of such release.

  

 -7- 

 (c) Each Company agrees that no fact, event, circumstance, evidence or transaction which could now be
asserted or which may hereafter be discovered shall affect in any manner the final, absolute and unconditional nature of the release set forth above. 
 [signature pages follow] 
  

 -8- 

 IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed by their respective
officers thereunto duly authorized and delivered as of the date first above written. 
  

			
	BORROWERS:
	
	TELOS CORPORATION,
	a Maryland corporation
		
	By	 	 /s/ Michael P. Flaherty

	Title	 	  

	
	 XACTA CORPORATION,
 a Delaware
corporation

		
	By	 	 /s/ Michael P. Flaherty

	Title	 	  

	
	CREDIT PARTIES:
	
	 TELOS DELAWARE, INC.,
 a
Delaware corporation

		
	By	 	 /s/ Michael P. Flaherty

	Title	 	  

	
	 UBIQUITY.COM, INC.,
 a Delaware
corporation

		
	By	 	 /s/ Michael P. Flaherty

	Title	 	  

 Signature Page to Waiver and Fourteenth Amendment to Loan and Security Agreement 

			
	TELOS.COM, INC.,
	a Delaware corporation
		
	By	 	 /s/ Michael P. Flaherty

	Title	 	  

	
	TELOS INTERNATIONAL CORP.,
	a Delaware corporation
		
	By	 	 /s/ Michael P. Flaherty

	Title	 	  

	
	TELOS INTERNATIONAL ASIA, INC.,
	a Delaware corporation
		
	By	 	 /s/ Michael P. Flaherty

	Title	 	  

	
	SECURE TRADE, INC.,
	a Delaware corporation
		
	By	 	 /s/ Michael P. Flaherty

	Title	 	  

	
	KUWAIT INTERNATIONAL, INC.,
	a Delaware corporation
		
	By	 	 /s/ Michael P. Flaherty

	Title	 	  

 Signature Page to Waiver and Fourteenth Amendment to Loan and Security Agreement 

			
	TELOS INFORMATION SYSTEMS, INC.,
	a Delaware corporation
		
	By	 	 /s/ Michael P. Flaherty

	Title	 	  

	
	TELOS FIELD ENGINEERING, INC.,
	a Delaware corporation
		
	By	 	 /s/ Michael P. Flaherty

	Title	 	  

	
	TELOS FEDERAL SYSTEMS, INC.,
	a Delaware corporation
		
	By	 	 /s/ Michael P. Flaherty

	Title	 	  

	
	AGENT AND LENDER:
	
	WELLS FARGO FOOTHILL, INC. (formerly known as Foothill Capital Corporation)
		
	By	 	 /s/ David Sanchez

	Title	 	V.P.

 Signature Page to Waiver and Fourteenth Amendment to Loan and Security AgreementSeparation Agreement

 Exhibit 10.1 
 SEPARATION AGREEMENT 
 AND 
 WAIVER AND RELEASE OF ALL CLAIMS 
 This Separation Agreement and Waiver
and Release of All Claims (the “Agreement”) is made and entered by and between Transgenomic, Inc. (the “Company”) and Collin J. D’Silva (“Employee”) in connection with the resignation of Employee. Company and
Employee desire to resolve all disputes between them, known and unknown. 
 In resolution of any and all disputes, if any, between the
Company and Employee arising from Employee’s employment by the Company or Employee’s resignation from the Company, or otherwise, and in consideration of the payments to Employee made under Paragraph 3 of this Agreement, the Company and
Employee promise and agree as follows: 
 1. Employment Status. Effective as of the Effective Date (as defined below) and
continuing through the Employment Termination Date (as defined below), Employee shall serve as the Company’s “Director of Mergers and Acquisitions.” During the period in which Employee serves as the Company’s Director of Mergers
and Acquisitions, Employee’s sole responsibility shall be to work with Thomas Weisel Partners, LLC (“TWP”) in connection with TWP’s evaluation of strategic alternatives on behalf of the Company. Employee’s services shall be
performed at the direction and under the supervision of the Company’s Chief Executive Officer, and the Chief Executive Officer shall participate in all meetings and conference calls between Employee, TWP and/or any third parties. Employee shall
vacate his Company office as of the Effective Date. Unless otherwise approved by the Company’s Chief Executive Officer, in writing, Employee shall not use Company facilities, equipment or support staff in performing his services as the
Company’s Director of Mergers and Acquisitions, except that Employee shall be provided with ongoing access to Company e-mail and cellular telephone service while performing such services. Effective as of the earlier of (a) the termination
of the Company’s engagement with TWP or (b) March 31, 2007 (such earlier date being referred to herein as the “Employment Termination Date”), Employee shall be deemed to have resigned his employment with the Company in all
capacities. From and after the Employment Termination Date, Employee’s employment by and with the Company shall be terminated and he shall no longer be employed by or as an agent of the Company. 
 2. Resignation of Positions as Officer and Director. Effective as of the Effective Date, Employee shall be deemed to have resigned from the
Board of Directors of the Company, including his position as Chairman of the Board. Additionally, effective as of the Effective Date, Employee shall be deemed to have resigned his position as Secretary of the Company. From and after the Effective
Date, Employee shall have no further rights as an officer or director of the Company or to serve as an observer to the Board of Directors of the Company. 
 3. Employment and Separation Payments. The Company shall, in exchange for the covenants and promises, and subject to all of the terms and conditions, contained in this Agreement, pay to Employee an
amount equal to Employee’s base salary in effect as of the date of this Agreement ($19,166.67 per month), less applicable federal, state and local withholding taxes, through March 31, 2007. Such payments shall be made in accordance with
the Company’s standard payroll procedure, and shall be made irrespective of whether the Employment Termination Date occurs prior to March 31, 2007. In addition, the Company shall reimburse Employee for all pre-approved and properly
reimbursable business expenses incurred in connection with Employee’s services as the Company’s Director of Mergers and Acquisitions through the Employment Termination Date. 
  

 4. Continued Health Insurance. Employee is eligible to elect continued group health
coverage under the Consolidated Omnibus Budget Reconciliation Act of 1985 (“COBRA”). If Employee chooses to continue health insurance coverage, the Company will pay the employer and employee portions of premiums for such continuation
coverage for a period of eighteen (18) months following the Effective Date. 
 5. Confidentiality, Non-competition and
Non-solicitation. 
 (a) Employee acknowledges that the information, observations and data obtained by him during the
course of his employment with the Company concerning the business or affairs of the Company and its subsidiaries is the property of the Company or such subsidiary, as the case may be. Therefore, Employee agrees that he will not directly or
indirectly use, divulge, furnish or make accessible to any unauthorized person or use for his own account any confidential or proprietary information or trade secrets of the Company or any of its subsidiaries without the Company’s prior written
consent, except and to the extent required by law. In the event Employee shall be required by law to make any disclosure as set forth above and prior to any such disclosure, Employee shall promptly notify the Company in writing of the basis for and
the extent of the required disclosure and shall cooperate with the Company to preserve in full the confidentiality of all intellectual property, trade secrets, confidential information and other proprietary rights of the Company and/or its
subsidiaries. For purposes hereof, confidential information does not include any information that has become publicly known or made generally available through no wrongful act of Employee or of any other person who is known by Employee to be subject
to a confidentiality agreement with the Company. 
 (b) Employee agrees that for three (3) years after the Employment
Termination Date, he will neither directly nor indirectly engage in, have any interest in, own, manage, operate, control, be connected with as a stockholder, joint venturer, officer, employee, partner or consultant or invest or participate in a
business competing with any of the businesses then conducted (or, to the knowledge of Employee, planned to be conducted within one year) by the Company or any of its successors or subsidiaries. 
 (c) Employee agrees that for one (1) year after the Employment Termination Date, he will not directly or indirectly through another
entity (i) induce or attempt to induce any employee of the Company or any subsidiary to leave the employ of the Company or such subsidiary, or in any way interfere with the relationship between the Company or any subsidiary and any employee
thereof, (ii) hire any person who was an employee of the Company or any subsidiary at any time during the prior six (6) months, or (iii) induce or attempt to induce any customer, supplier, licensee or other business relation of the
Company or any subsidiary to cease doing business with the Company or such subsidiary, or in any way interfere with the relationship between any such customer, supplier, licensee or business relation and the Company or any subsidiary. 
 (d) Nothing contained in this Paragraph 5 shall prevent Employee from owning up to a 5% interest in any corporation or entity having one
or more classes of its securities listed on a national securities exchange or publicly traded in the over-the-counter market, provided Employee is not actively involved in the operation or management of such corporation or entity. 
 (e) If, under the circumstances existing at the time of enforcement of this Paragraph 5, the period, scope or geographic area described in
this Paragraph 5 shall be found or held to be unreasonable, the parties hereto agree that the maximum period, scope or geographic area reasonable under the circumstances shall be substituted for the stated period, scope or geographic area.

 6. Release of All Claims. In consideration of the payments made pursuant to Paragraph 3 of this
Agreement, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Employee, on behalf of Employee and his Heirs, hereby irrevocably, unconditionally and completely releases, discharges and holds
harmless the Company of, from and 

  

 2 

 
against any and all Claims (as such terms are defined below). This release is a material inducement to the Company to enter into this Agreement. 

The release set forth in this Paragraph 6 includes, without limitation, any Claim(s) that Employee or his Heirs has, had, or may claim to have,
whether known or unknown, against the Company for or arising out of: 
  

	 	•	 	 Breach of express or implied contract, including but not limited to any contract of employment, and any employment-related torts or personal injuries (whether
physical or mental), including wrongful termination or discharge, intentional or negligent infliction of emotional distress, defamation, interference with contractual relations, invasion of the right to privacy, misrepresentation, negligence,
conspiracy or otherwise; 

  

	 	•	 	 Any federal or state law, including without limitation Title VII of the Civil Rights Act of 1964 [42 USC Section 2000e (and following sections)], or any other
federal, state or local law that prohibits discrimination on the basis of race, color, religion, sex, age, national origin, ancestry, disability, or any other protected group status; 

  

	 	•	 	 The Age Discrimination in Employment Act and the Older Workers Benefit Protection Act [29 USC Section 621 (and following sections)], which prohibit
discrimination against employees age 40 and above; 

  

	 	•	 	 The Family and Medical Leave Act [29 USC Section 2601 (and following sections)]; 

  

	 	•	 	 The Employee Retirement Income Security Act [29 USC Section 1001 (and following sections)]; 

  

	 	•	 	 The Reconstruction Era Civil Rights Act [42 USC Section 1981 (and following sections)]; 

  

	 	•	 	 The Americans with Disabilities Act [29 USC Section 12101 (and following sections)]; 

  

	 	•	 	 The Worker Adjustment and Retraining Notification Act [29 USC Section 2100 (and following sections)]; 

  

	 	•	 	 Attorneys’ fees, expenses, or court costs; and 

  

	 	•	 	 Any other Claim(s) in any way related to or arising out of Employee’s employment with the Company or the termination of that employment.

 Nothing in this Agreement waives Employee’s rights, if any, to continue Employee’s participation in any employee welfare
benefit plan, as allowed by COBRA and the terms, conditions, and limitations of any such plan, or any vested rights that Employee may have under any employee pension or welfare benefit plan or stock option plan in which Employee participated as an
employee of the Company. 
 For purposes of this Agreement, the following terms shall have the following meanings: 
 “Heir(s)” means and includes Employee’s heirs, personal representatives, guardians, conservators or assigns, and any
and all other persons or entities claiming by, through, or under Employee. 
 “Claim(s)” means and includes
any and all claims, liabilities, charges, demands, promises, agreements, grievances and lawsuits (including claims for attorneys’ fees, costs, back 

  

 3 

 
pay, front pay, benefits and punitive and compensatory damages) of any nature whatsoever and causes of action of any kind or nature whatsoever, including
without limitation, claims for contribution, subrogation, or indemnification, whether direct or indirect, liquidated or unliquidated, known or unknown, which Employee or any Heir had, has, or may claim to have against the Company, arising out of or
otherwise related to Employee’s employment by the Company (or the termination of such employment). 
 7. Full and Complete
Release. Employee understands and agrees that he is releasing and waiving all Claim(s) of any type, whether or not Employee knows that any such Claim(s) exist in Employee’s favor at the time Employee signs this
Agreement, and including Claims which, if Employee knew of their existence, would materially affect Employee’s decision to sign this Agreement. For the purpose of implementing a full and complete release and discharge of the Company, Employee
expressly acknowledges that the release set forth in Paragraph 6 is intended to include in its effect, without limitation, all Claim(s) which Employee does not know or suspect to exist at the time this Agreement is executed and that the release set
forth in Paragraph 6 contemplates the extinguishment of any such Claim(s). 
 8. Covenant Not to Sue.
Employee promises not to file, or permit to be filed on Employee’s behalf, and immediately to dismiss or withdraw, any lawsuit, charge, or complaint against the Company with any administrative agency (unless prohibited by applicable statute or
agency regulation) or with any state or federal court asserting any Claim(s) released in Paragraphs 6 and 7. In addition, Employee waives any right to recover damages, costs, and attorneys’ fees in any action brought by Employee or by any other
person or entity on Employee’s behalf asserting any Claim(s) released by Paragraphs 6 and 7. 
 If and only if a court of competent
jurisdiction rules, and such ruling is affirmed on appeal or the Company elects not to appeal such ruling, that Employee is prohibited from waiving Employee’s right to recover damages, costs, or attorneys’ fees, as set forth above,
Employee agrees that the entire amount paid to Employee under Paragraph 3 of this Agreement, less the sum of One Hundred and no/100 Dollars ($100.00), shall be set off against any recovery that Employee might obtain against the Company in any action
brought against the Company asserting any Claim(s) released in Paragraphs 6 and 7 hereof. In addition, the Company will be released of all covenants and promises it has made in connection with the execution of this Agreement and will be entitled to
recover any and all legal fees and costs (including expert fees) incurred by the Company in defending against any action or charge brought against the Company asserting any Claim(s) released under Paragraphs 6 and 7 of this Agreement, in addition to
any other relief to which the Company may be legally entitled. 
 9. Compliance with Securities Laws. Employee
acknowledges that he currently is and, after the Employment Termination Date, he will continue to be subject to all applicable laws, rules and regulations governing the sale or purchase of securities, including but not limited to the Securities Act
of 1933 (the “33 Act”) and the Securities Exchange Act of 1934 (the “34 Act”) with respect to shares of the common stock of the Company. Accordingly, Employee agrees that, for so long as he holds at least ten percent
(10%) of the outstanding capital stock of the Company, he will not trade in Company securities if he is in possession of any material, non-public information with respect to the Company. Additionally, Employee agrees that, through the
Employment Termination Date, he (a) will comply with all Company policies pertaining to or limiting the sale of Company securities, including but not limited to any trading windows, and (b) will notify the Company’s Chief Financial
Officer at least three (3) business days prior to executing any trade of Company securities. Provided that the Employee has complied with the requirements of subparagraph (b) of the immediately preceding sentence, through the Employment
Termination Date, the Company agrees that it shall prepare and submit to the United States Securities and Exchange Commission, on the Employee’s behalf, any filings required pursuant to Sections 13(d) and 16 of the 34 Act and the rules and
regulations promulgated thereunder. Employee hereby acknowledges that, after the Employment Termination Date, he shall be solely responsible for preparing and submitting to the United States Securities and Exchange Commission any filings required
pursuant to Sections 13 (d) and 

  

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16 of the 34 Act and the rules and regulations promulgated thereunder, and Employee represents to the Company that all such filings shall be in compliance
with the requirements of the 34 Act. 
 10. Acknowledgement of Receipt. Employee acknowledges and agrees that on the 9th day of
January, 2007, he received from the Company a copy of this Agreement. 
 11. Review Period. Employee acknowledges and
understands that he has been given twenty-one (21) days from the date Employee receives a copy of this Agreement to consider and review the terms of this Agreement prior to signing it, and releasing his claims. Employee understands that he may
execute this Agreement, in his sole and absolute discretion, prior to the expiration of said twenty-one (21) day period. 
 12.
Right of Revocation. Employee acknowledges and understands that he may revoke this Agreement for a period of up to seven (7) days after he executes it (not counting the day it is signed). To revoke this Agreement, Employee must
give written notice to the Company stating that Employee wishes to revoke this Agreement, by providing notice by hand-delivery or U.S. mail to: 
 Mr. Greg Sloma 
 Transgenomic, Inc. 
 12325 Emmett 
 Omaha, NE 68164 
 If Employee mails a notice of revocation to the Company, it must be postmarked no later than seven (7) days following the date on which Employee signed this Agreement (not counting the day it was signed) or the
revocation will not be effective. 
 Employee acknowledges and understands that the “Effective Date” of this Agreement shall be
seven (7) days following execution by Employee of this Agreement, if the Agreement is not revoked. 
 13. Remedies.
Employee expressly acknowledges that any breach or violation of any of the covenants and agreements made by him in this Agreement will cause immediate and irreparable injury to the Company and that in the event of a breach or threatened or intended
breach of this Agreement by him, the Company, in addition to all other legal and equitable remedies available to it, shall be entitled to injunctions, both preliminary and temporary, and restraining orders, enjoining and restraining such breach or
threatened or intended breach. 
 14. Wages Paid in Full. The Company agrees that, on January 15, 2007, it shall
pay to Employee all of Employee’s accrued but unused vacation benefits. Upon receipt of such payment, Employee acknowledges that he shall have received all monies due and owing to Employee from the Company, including without limitation any
monies due and owing to Employee for wages, vacation benefits or otherwise, and that he has no claim against the Company whatsoever for the payment of any further wages, vacation benefits, or other monies except as specifically identified herein.

 15. Return of Property. Employee certifies that he has delivered or caused to be delivered to the Company the following:

 a. any and all Company equipment and all documents or other tangible or electronic materials (whether originals, copies, or
abstracts, and including without limitation, books, records, manuals, files, calling or business cards, credit cards, customer or company lists or records, correspondence, computer printout documents, contracts, phone and address lists, memoranda,
notes, work papers, agreements, invoices and receipts) which in any way relate to the Company’s business and were furnished to Employee by the Company or were prepared, 

  

 5 

 
compiled, used or acquired by Employee while employed by the Company, excluding personal items paid for by Employee and any items that are necessary to the
performance of Employee’s services as Director of Mergers and Acquisitions (which items shall be delivered to the Company upon the Employment Termination Date); 
 b. all keys, combinations, and access codes to the premises, facilities and equipment of the Company (including without limitation, the
offices, desks, storage cabinets, safes, data processing systems and communications equipment); and 
 c. any money owed by
Employee to the Company for whatever reason. 
 16. Restriction on Disclosure. This Agreement is and contains
confidential information owned by the Company. Employee agrees that he shall not disclose the terms of this Agreement except to the extent required by law. Notwithstanding the foregoing, Employee may disclose the terms of this Agreement to
Employee’s spouse, attorney, agent, financial advisor or tax advisor if, as a condition of such disclosure, Employee first advises such person and obtains a commitment in favor of the Company that such person must not disclose the terms of this
Agreement except to the extent required by law. 
 17. No Admission. This Agreement does not constitute an admission by
the Company or Employee, and the Company and Employee each specifically deny that the Company or Employee has violated any contract, law, or regulation or that it has discriminated against the other party or otherwise infringed on the other
party’s rights or privileges or done any other wrongful act. 
 18. General. This Agreement constitutes the entire
understanding between the parties on the subject matter contained herein, and supersedes all negotiations, representations, prior discussions, and preliminary agreements between the parties. No promise, representation, warranty, or covenant not
included in this Agreement has been or is relied upon by either party. Notwithstanding any statute or case law to the contrary, this Agreement may not be modified except by a written instrument signed by each of the parties, whether or not such
modification is supported by separate consideration. This Agreement shall be binding upon and be for the benefit of the Company and its successors and assigns and Employee and his Heirs. Employee and the Company warrant that they have not assigned
any Claim(s) released by this Agreement, or any interest therein, to any third party. Any waiver by any party hereto of any breach of any kind or character whatsoever by any other party, whether such waiver be direct or implied, shall not be
construed as a continuing waiver of, or consent to, any subsequent breach of this Agreement on the part of the other party. In addition, no course of dealing between the parties, nor any delay in exercising any rights or remedies hereunder or
otherwise, shall operate as a waiver of any of the rights or remedies of the parties. The provisions of this Agreement are severable. If any part of this Agreement is found to be unenforceable, the other provisions shall remain fully valid and
enforceable. It is the intention and agreement of the parties that all of the terms and conditions hereof be enforced to the fullest extent permitted by law. 
 19. Knowing and Voluntary Execution. Employee acknowledges that he has read this Agreement carefully and fully understands the meaning of the terms of this Agreement. Employee acknowledges that he
has signed this Agreement voluntarily and of Employee’s own free will and that he is knowingly and voluntarily releasing and waiving all Claim(s) that he has or may have against the Company. 
 20. Consultation with Attorney. The Company advises Employee to consult with an attorney of Employee’s choosing prior to signing this
Agreement. Employee will be solely responsible for any attorneys’ fees incurred by Employee in connection with this Agreement. 
 21. Employee Representations. Employee represents and warrants that: (a) he is over the age of majority, of sound mind and has the exclusive power and authority to execute and deliver the 

  

 6 

 
Agreement; (b) the Agreement has been duly executed and delivered by Employee, after having been advised in writing to seek legal counsel and having the
opportunity to consult with legal counsel, and it constitutes Employee’s legal, valid, and binding obligation enforceable in accordance with its terms; (c) Employee is the exclusive owner of all rights and claims Employee may have or
assert against the Company and no person or entity is now, or shall be, subrogated to any claims or rights that Employee has or may have against the Company; and (d) no promises, representations or inducements have been made by the Company to
Employee to cause Employee to sign the Agreement. 
 22. Miscellaneous. All matters pertaining to the validity, construction,
interpretation, and effect of the Agreement shall be governed by the laws of the State of Nebraska. If for any reason the Agreement is not executed or otherwise consummated, the Agreement shall not constitute any evidence in any proceeding or be
used in discovery in any way. Employee and the Company agree mutually not to denigrate or disparage the other following the Employee’s termination of employment. 
 I HAVE BEEN AFFORDED THE OPPORTUNITY TO REVIEW AND CONSIDER THIS DOCUMENT FOR AT LEAST TWENTY-ONE (21) DAYS. 
 I UNDERSTAND THAT I HAVE SEVEN (7) DAYS FROM THE DATE GIVEN BELOW TO REVOKE THIS RELEASE AND WAIVER. 
 I HAVE READ AND
UNDERSTAND THIS DOCUMENT. I HAVE SIGNED THIS DOCUMENT FREELY AND OF MY OWN ACCORD AFTER HAVING BEEN GIVEN AMPLE OPPORTUNITY AND HAVING BEEN ADVISED TO SECURE THE ADVICE AND COUNSEL OF AN ATTORNEY OF MY CHOOSING. 
  
 Executed this 12th day of January, 2007. 
  

			
	Transgenomic, Inc.
		
	By:	 	/s/ GREGORY T. SLOMA
	Its:	 	Board Member
	
	Transgenomic, Inc.
	
	/s/ COLLIN J. D’SILVA
	Collin J. D’Silva

  

 7

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