Document:

Exhibit 10.32.1

 

SIMPSONVILLE
BACKSTOP INDEMNITY AGREEMENT

 

This
Simpsonville Backstop Agreement (this “Agreement”) is dated as of July 30, 2020 and is made by and among James
Walesa, an individual that is a domicile in the State of Texas (“Walesa”) and Allied Integral United, Inc.,
a Delaware corporation having an address at 8800 Village Drive, Suite 201, San Antonio, Texas 78217(the “Corporation”).

 

Reference
is made to that certain Amended And Restated Backstop Indemnity Agreement, dated as of February 26, 2020 (the “Backstop Indemnity
Agreement”), by and among (a) the Corporation; and each of Steve Person, an individual that is a domicile in the State
of Texas (“Person”), Walesa, and BJ Parris, an individual that is a domicile in the State of Texas (“Parrish”
and, together with Person and Walesa, each a “Guarantor” and, collectively, the “Guarantors”).
Capitalized terms used in this Agreement that are not otherwise defined in this Agreement shall have the respective meanings ascribed
to such terms in the Backstop Indemnity Agreement.

 

WHEREAS,
a copy of the Backstop Indemnity Agreement is attached to this Agreement as Exhibit I;

 

WHEREAS,
pursuant to the Backstop Indemnity Agreement, the Corporation has indemnified each Guarantor for the Guaranteed Obligations;

 

WHEREAS,
certain subsidiaries of the Corporation are parties to that certain litigation (the “Simpsonville Litigation”)
captioned and numbered MC-Simpsonville, SC-UT, LLC v. Steve Person, et. al., Cause No. 19-0651-C368 in the 368th Judicial District Court
of Williamson County, Texas (the “Specified Court”), including Memory Care America LLC (“MCA”)
and Trident Healthcare Properties I, L.P. (“Trident” and, together with MCA (the “Specified Subsidiaries”);

 

WHEREAS,
the Specified Subsidiaries may have liabilities under any judgement of the Specified Court;

 

WHEREAS,
Walesa has agreed to fully indemnify the Corporation from and against all obligations of the Specified Subsidiaries with respect to any
judgement of the Specified Court, including without limitation, all post judgment interest and costs payable by any Specified Subsidiary
with respect to the Simpsonville Litigation (the “Walesa Guaranteed Obligations”);

 

NOW,
THEREFORE, in consideration of the mutual promises set forth herein and other good and valuable consideration, the receipt and legal
sufficiency of which are hereby acknowledged, each of the parties hereto does hereby covenant and agree as follows:

 

1.
Incorporation of Recitals and Exhibits. The recitals to this Agreement and any exhibits or schedules attached hereto are hereby
incorporated by reference into this Agreement as if fully and completely set forth herein.

 

    	 

     

    

 

2.
Obligations of Walesa.

 

(a)
Walesa shall promptly reimburse and repay the Corporation the full amount of the Walesa Guaranteed Obligations that is paid by the Corporation
or any subsidiary of the Corporation, including without limitation, the Specified Subsidiaries.

 

(b)
If any obligation of Walesa under Section 2(a) is not paid as and when any such obligations are due and payable by the Corporation or
any of the Specified Subsidiaries, then Walesa shall pay an additional amount that is equal to 15% per annum, compounded annually (the
“Contribution Rate”), from the date such obligations are due and payable until the date of full payment by
Walesa.

 

(c)
The obligations of Walesa under this Agreement are unsecured and personal obligations of Walesa.

 

(d)
Walesa hereby releases the Corporation from and against any obligation under the Backstop Indemnity Agreement arising from or related
to the Walesa Guaranteed Obligations.

 

3.
Fee and Payments.

 

(a)
The Corporation shall pay Walesa a fee that is equal to 2% of the amount of any judgement of the Specified Court, plus all post-judgement
interest that is awarded by the Specified Court in the event that the Specified Subsidiaries (or any of them) appeal any such judgement.

 

(b)
The fee that is payable by the Corporation shall be paid by the Corporation causing its subsidiary AIU Alternative Care, Inc. issuing
shares of its 10.25% Series I Cumulative Convertible Preferred Stock (“Clearday Care Preferred”) and the Corporation
granting warrants (“Clearday Warrants”) to purchase shares of the common stock of the Corporation at a unit
price equal to $10.00 per unit. The fee shall be payable promptly after the date or dates that the fee is determined.

 

(c)
The Corporation will provide (and will cause AIU Alternative Care, Inc. to provide) additional units of Clearday Care Preferred and Clearday
Warrants for any and all payments that are made by Walesa at a price equal to $10.00 per unit.

 

4.
Remedies. In the event that Walesa is in default in the payment of its Walesa Guaranteed Obligations hereunder, then the Corporation
may institute legal action to enforce the payment of such obligations.

 

5.
Reformation. If any provision hereof shall be invalid under applicable law, then such provisions shall be deemed omitted to the
extent invalid, but the remaining provisions hereof shall be given effect in accordance with the intent hereof, and the Parties agree
to execute such amendments to this Agreement as may be required in order to give full effect to the intent hereof.

 

6. Unconditional
Guaranteed Obligations. This Agreement creates an obligation of payment and not of collection and Walesa waives (i) any right to
require that resort be had to any security held by any of the Specified Subsidiaries, (ii) all notice to which Walesa might
otherwise be entitled, (iii) notice of presentment, protest, notice of protest, notice of non-payment, notice of dishonor, notice of
intent to accelerate and notice of acceleration with respect to a default hereunder by Walesa, and (iv) the Corporation or any
subsidiary of the Corporation, including any of the Specified Subsidiaries, pursuing any rights against any Guaranteed Person under
any obligation of such person to indemnify the plaintiff in the Specified Litigation. Walesa hereby consents and agrees and
acknowledges that Walesa Guaranteed Obligations hereunder shall not be released or discharged by any act or omission of the
Corporation or any of the Specified Subsidiaries or any other person which would otherwise constitute or create a legal or equitable
defense in favor of Walesa.

 

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7.
Collection Costs. If any dispute arises between any Parties with respect to this Agreement, then all reasonable attorney’s
fees and disbursements incurred by the prevailing Party in any action, arbitration or other judicial or quasi-judicial proceeding with
respect to such dispute shall be paid, on demand, with interest thereon at the Contribution Rate from the date incurred until the date
paid in full, by the non-prevailing Party.

 

8.
Binding Effect; Assignment and Assumption; No Third-Party Beneficiaries. This Agreement shall be binding upon and inure to the
benefit of each Party and their respective successors, assigns and legal representatives; provided, however, that no Party may, without
prior written consent of the other Parties, assign any of its rights, powers, duties or Walesa Guaranteed Obligations hereunder.

 

9.
Amendments. This Agreement may not be modified, waived or terminated except by an instrument in writing executed by all of the
Parties.

 

10.
Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Texas, without regard
to principles of conflicts of law.

 

11.
Counterparts. This Agreement may be executed in any number of counterparts, with the same effect as if all of the parties had
signed the same document. All counterparts shall be construed together and constitute one Agreement.

 

12.
Consent to Jurisdiction. Each Party hereby irrevocably submits to the non- exclusive jurisdiction of any state or federal court
sitting in the State of Texas, County of Bexar in any action or proceeding arising out of or relating to this Agreement or any of the
transactions contemplated hereby and hereby irrevocably agrees that all claims in respect of such action or proceeding maybe heard and
determined in such district court or, to the extent permitted by law, in such federal court. The Parties hereby irrevocably waive, to
the fullest extent they may effectively do so, the defense of an inconvenient forum to the maintenance of such action or proceeding.

 

13. Waiver
of Jury Trial. EACH PARTY HEREBY KNOWINGLY, VOLUNTARILY, UNCONDITIONALLY AND INTENTIONALLY FOREVER WAIVES THE RIGHT TO A TRIAL
BY JURY IN RESPECT OF ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER ARISING IN TORT OR CONTRACT) BROUGHT BY ANY PARTY AGAINST SUCH
PARTY ON ANY MATTER ARISING OUT OF OR IN ANY WAY CONNECTED WITH THIS AGREEMENT.

 

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IN
WITNESS WHEREOF, the parties hereto have duly executed and delivered this Backstop Indemnity Agreement as of the day and year first above
written.

 

	 	Allied
    Integral United, Inc.

 d/b/a Clearday, Inc. 
	 	 
	 	By:	/s/
    BJ Parrish
	 	Name:	 B.J. Parrish 
	 	Title:	Chief Operating Officer

 

	 	/s/
    James Walesa
	 	James
    Walesa, Individually

 

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EXHIBIT
I

 

Copy
of the Backstop Indemnity Agreement 

 

[attached hereto]

 

    	 

     

    

 

AMENDMENT
TO THAT CERTAIN

SIMPSONVILLE BACKSTOP
INDEMNITY AGREEMENT

 

This
amendment (this “Amendment”) to the Simpsonville Backstop Agreement (the “Agreement”)
is dated as of January 19, 2021 and is made by and among James Walesa, an individual that is a domicile in the State
of Texas (“Walesa”) and Allied Integral United, Inc., a Delaware corporation having an address at 8800 Village
Drive, Suite 201, San Antonio, Texas 78217(the “Corporation”).

 

Reference
is made to the Agreement dated as of July 30, 2020. Capitalized terms used in this Amendment that are not otherwise defined in this Amendment
shall have the respective meanings ascribed to such terms in the Agreement.

 

WHEREAS,
Walesa has agreed to fully indemnify the Corporation from and against all Walesa Guaranteed Obligations;

 

WHEREAS,
under the Agreement, the obligations of Walesa are unsecured and personal obligations of Walesa;

 

WHEREAS,
the Corporation has cause to believe that cash resources of Walesa may become subject to payment to MC-Simpsonville, SC-UT, LLC and its
affiliates and, accordingly, for the Corporation to have reasonable assurances for the Walesa Guaranteed Obligations to be paid on a
timely basis by Walesa, the Corporation and Walesa have agreed that Walesa will guaranty the Walesa Guaranteed Obligations by the pledge
of Walesa’s stock or equity interests in the Corporation and each of its subsidiaries.

 

NOW,
THEREFORE, in consideration of the mutual promises set forth herein and other good and valuable consideration, the receipt and legal
sufficiency of which are hereby acknowledged, each of the parties hereto does hereby covenant and agree as follows:

 

1.
Incorporation of Recitals and Exhibits. The recitals to this Agreement and any exhibits or schedules attached hereto are
hereby incorporated by reference into this Agreement as if fully and completely set forth herein.

 

2.
Obligations of Walesa.

 

Section
2(c) of the Agreement is hereby amended to read in its entirety as follows:

 

The
obligations of Walesa under this Agreement are personal obligations of Walesa and secured by the pledge of all stock or any
equity interests of Walesa in the Corporation and its subsidiaries (collectively, the “Pledged
Securities”), including without limitation: (i) shares of common stock, par value $0.01 per share (“AIU
Common Stock”); (ii) warrants to purchase shares of AIU Common Stock (“AIU Warrants”); (iii)
shares of 6.75% Series A Cumulative Convertible Preferred Stock, par value $0.01 per share (“Series A
Preferred”); and (iv) shares ofthe 10.25% Series I Cumulative Convertible Preferred Stock, par value $0.01 per share,
of AIU Alternative Care, Inc., a Delaware corporation (“AIU Care”). The pledge of the Pledged Securities
shall be under the terms and conditions of that certain Securities Pledge Agreement dated as of even date of this Amendment.

 

3.
Ratification. The terms and conditions of the Agreement are, as amended by the terms of this Amendment, hereby ratified and confirmed
in all respects. From and after the date of this Amendment, the terms and conditions of the Agreement shall be amended in all respects
by the terms and conditions of this Amendment.

 

4. Governing
Law. This Amendment shall be governed by and construed in accordance with the laws of the State of Texas, without regard
to principles of conflicts oflaw.

 

5.
Counterparts. This Amendment may be executed in any number of counterparts, with the same effect as if all of the parties had
signed the same document. All counterparts shall be construed together and constitute one amendment or agreement for amendment.

 

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6.
IN WITNESS WHEREOF, the parties hereto have duly executed and delivered this Amendment as of the day and year first above written.

 

Allied
Integral United, Inc.

d/b/a Clearday, Inc.

 

 

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ATTACHMENT

 

Copy
of Securities Pledge Agreement

 

[attached
hereto]Exhibit 10.32.2

 

SECURITIES
PLEDGE AGREEMENT

 

TIDS
SECURITIES PLEDGE AGREEMENT (this “Agreement”) is made as of January 19_ 2021 (the
“Effective Date”), by and among
James Walesa, an individual
that is a domicile in the State of Texas (“Walesa”
also referred to as the “Pledgor”) and Allied Integral United, Inc., a Delaware corporation having an address at
8800 Village Drive, Suite 201, San Antonio, Texas 78217 (the “Corporation” and also referred to as the “Pledgee”).
(collectively, the “Pledgor”) in favor of the Pledgee.

 

RECITALS:

 

WHEREAS,
Pledgee has obligations (the “Walesa Guaranteed Obligations”) under that certain Simpsonville Backstop Agreement, as
amended to and including the date ofthis Agreement (the “Indemnity Agreement”);

 

WHEREAS,
the Pledgee has agreed to collateralize and secure the Walesa Guaranteed Obligations by granting a security interest in the securities
listed on Schedule A, attached hereto, and all and any other securities issued by the Corporation or any subsidiary of the Corporation,
including any options or warrants or other rights to acquire any securities of the Corporation or any subsidiary ofthe Corporation or
any subsidiary ofthe Corporation (collectively, the “Pledged Securities”);

 

WHEREAS,
capitalized terms used in this Agreement and not otherwise defined herein shall have the meaning ascribed to such term in the Indemnity
Agreement; and

 

WHEREAS,
in order to secure the payment ofany and all obligations ofPledgor under the Indemnity Agreement, Pledgor hereby pledges and grants Pledgee
a security interest in all of the Pledged Securities in accordance with the terms and conditions of this Agreement.

 

NOW, THEREFORE, in
consideration of the foregoing premises, the truth and accuracy of which are hereby acknowledged by the Parties, and in order to induce
Pledgee to continue to incur obligations regarding the Simpsonville Litigation without currently demanding the fully payment thereof on
or prior to the date of this Agreement and for other good and valuable consideration, the receipt and sufficiency ofwhich is hereby acknowledged,
Pledgor hereby agrees as follows:

  

AGREEMENT:

 

	1.	Definitions.

 

(a)       The
term “Company” shall mean the Corporation and, unless the context otherwise requires,
AIU Alternative Care, Inc., a Delaware corporation and each other subsidiaries of the Corporation and/or their respective successors.

 

(b)       The
term “Event of Default” shall mean and include: (i) any material inaccuracy in any representation
or warranty made by Pledgor in this Agreement; (ii) any breach of Pledgor’ s covenants contained in this Agreement; or (iii) any
default under the terms of the Indemnity Agreement that is not cured within five (5) business days
after notice of such default by the Corporation.

    	 

     

    

 

 

(c)       The
term “Instruments” shall mean each certificate or other instrument (if any) representing any of the Pledged Securities.

 

(d)       The
term “Obligations” shall mean all debts, obligations and liabilities of Pledgor to Pledgee under the Indemnity Agreement,
including the Walesa Guaranteed Obligations.

 

(e)       The
term “Securities Laws” shall mean, collectively, the Securities Act of 1933, as amended, as now or hereafter in effect, any
similar federal or state statute and blue sky laws now or hereafter enacted analogous in purpose or effect.

 

(f)       The
term “UCC” shall mean the Uniform Commercial Code as now enacted or hereafter in effect in the State of Delaware.

 

(g)       All
other capitalized terms not defined herein shall have the meanings ascribed thereto in the Indemnity Agreement.

 

	2.	Pledge and Security Interest.

 

To
secure all of the Obligations, Pledgor hereby grants, pledges, hypothecates, assigns and delivers to Pledgee a first priority security
interest in all of Pledgor’s respective right, title and interest in and to the Pledged Securities, including, without imitation
(i) all rights and interest of Pledgor in the capital of the Company deriving or arising from the Pledged Securities and, subject to Section
7, all rights of Pledgor to receive distributions, cash, instruments and other property from time to time receivable or otherwise distributable
in respect of the Pledged Securities, (ii), subject to Section 7, all other payments due or to become due to Pledgor in respect of the
Pledged Securities including, but not limited to, all rights of Pledgor to receive proceeds of any insurance, indemnity, warranty or guaranty
with respect to the Pledged Securities, (iii), subject to Section 6, any right of Pledgor to perform
and exercise consensual or voting rights thereunder and to compel performance and otherwise exercise all remedies thereunder deriving
or arising from the Pledged Securities,

 

(iv)
subject to Section 7, all rights of Pledgor deriving or arising from the Pledged Securities, to all property and assets of the Company
(whether real property, inventory, equipment, contract rights, accounts, receivables, general intangibles,
securities, instruments, chattel paper, documents, choses in action, licenses, permits or otherwise), (v) all certificates or instruments
(if any) evidencing the Pledged Securities or other ownership thereof in the Company or its
assets, and (vi) to the extent not included in the foregoing, all proceeds of any and all of the foregoing (including, without limitation,
proceeds that constitute property of the types described above).

 

	3.	Delivery of Certificates for Pledged Securities.

 

Simultaneously
with the execution of this Agreement, Pledgor shall transfer and deliver to Pledgee the Instruments evidencing
the Pledged Securities. The foregoing Instruments shall be accompanied by a unit transfer
power, duly endorsed in blank by Pledgor, to the benefit of Pledgee. Pledgee shall have the right, upon Pledgor’s default in the
payment or performance of the Obligations, in its discretion, to transfer to or to register in the name of Pledgee or any of its nominees
any or all of the Pledged Securities; provided, that Pledgee shall promptly notify Pledgor of any such transfer or registration,
but the failure to provide such notice will not invalidate such transfer or registration; provided, further, that upon the cure or waiver
of any such default, the Pledgee shall promptly re-transfer such Pledged Securities to Pledgor and register such Pledged Securities in
the name of Pledgor.

 

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	4.	Additional Property to be Pledged.

 

If Pledgor receives,
or becomes entitled to receive, any units or other Instruments representing securities of the Company with respect to such Pledged Securities
(including, without limitation, any certificates issued pursuant to the declaration of a dividend or unit split, or pursuant to a merger,
recapitalization or reorganization), Pledgor agrees to accept the same as Pledgee’s and to hold the same in an express trust for
the benefit of Pledgee and to deliver the same forthwith to Pledgee, in the identical form in which the same was received, and, upon request
of Pledgee, together with Pledgor’s unit transfer power duly executed in blank. Such certificates shall be held on behalf of Pledgee
subject to the terms hereof as further security for the Obligations. All such Instruments required
to be pledged under this Section 4 shall be included within, held, applied and disposed of as part of the Pledged Securities pursuant
to the terms of this Agreement. All other proceeds of, substitutions for and distributions regarding the Pledged Securities received by
Pledgor will be held by Pledgor in express trust for Pledgee, will not be commingled with any other funds or property of Pledgor, and
will be turned over to Pledgee in precisely the form received (but endorsed by Pledgor, if necessary) not later than the business day
following the day of their receipt by Pledgor; and all proceeds of, substitutions for and distributions relating to the Pledged Securities
will be held by Pledgee as Pledged Securities hereunder.

 

	5.	Certain Representation, Warranties and Covenants of Pledgor.

 

Pledgor
makes the following representations, warranties and covenants to Pledgee:

 

(a)       Ownership.
The Pledged Securities are titled in the name of Pledgor and Pledgor is the sole legal and beneficial owner of the Pledged Securities.

 

		(b)	Authority.

 

(i)           Pledgor
has all necessary power and authority and capacity to enter into this Agreement and perform Pledgor’s obligations hereunder.

 

		(ii)	The execution, delivery and performance of this Agreement:

 

		(A)	does not require the approval of any governmental agency, other entity or person; and
	 	 	 
		(B)	will not violate any law, agreement or restriction by which Pledgor is bound.

 

(iii)           This
Agreement is the legal, valid and binding obligation of Pledgor, and is enforceable against Pledgor in accordance with its terms.

  

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		(c)	Title.

 

(i)           The
Pledged Securities are, and during the term of this Agreement will be, owned by Pledgor free and clear of any pledge, mortgage, security
interest, hypothecation, lien, charge, encumbrance, conditional sale and other title retention agreements,
choate and inchoate tax liens, assessments, covenants, restrictions, reservations, rights or claims of third parties, other burdens and
any security interest therein, except the security interest granted under this Agreement for the benefit of Pledgee.

 

(ii)           The
Pledged Securities are, and during the term of the Agreement will be, free from any rights of first refusal or other restrictions (other
than those in favor of Pledgee) that could impair, impede or affect Pledgee’s sale of the Pledged Securities. The Pledged Securities
are not subject to any restrictions on transfer and/or disposition by Pledgor or Pledgee.

 

		(d)	Maintenance of Security Interest; Defend Pledgee’s Rights.

 

(i)           Pledgor
will take any action reasonably requested by Pledgee to preserve the Pledged Securities and to perfect, establish the priority of, continue
perfection and enforce Pledgee’s interest in the Pledged Securities and Pledgee’s rights under this Agreement (including the
delivery of any unit powers and endorsements deemed necessary by Pledgee). Pledgor warrants and will defend and preserve Pledgee’s
right, title and first priority security interest in and to the Pledged Securities against the claims and legal proceeding of any and
all third parties.

 

		(ii)	In addition, Pledgor will:

 

	 	(A)	pay and discharge when due all taxes, levies and other charges or fees which may be assessed against the Pledged Securities;
	 	(B)	not sell, assign (by operation of law or otherwise), transfer or otherwise dispose of the Pledged Securities to any party;
	 	(C)	not permit the Pledged Securities to be used or owned in violation of any applicable law, regulation or policy of insurance;
	 	(D)	not make any instructions or entitlement orders which are contrary to the terms of this Agreement; and
	 	(E)	not create or suffer to exist any lien or encumbrance upon or with respect to the Pledged Securities, except the p edge, assignment, hypothecation and security interest created by tbis Agreement.

 

(e)       Certificates and Instruments. Tue Instruments described herein are all o :the Instruments, whether or not in the possession of Pledgor,
which relate to the Pledge Secunties, and all of such Instruments are being delivered to Pledgee contemporaneously herewith.

 

(f)       Holding
Periods. Pledgor will promptly furnish to Ple gee sue inf ation as Pledgee deems necessary to comply with Securities Laws as to the holding
and d1sposrb.on of any Pledged Securities, and to determine the status of the Pledged Securities under Securities Laws, all in form satisfactory
to Pledgee and at Pledgor’ s expense.

 

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	6.	Exercise of Voting Rights.

 

Until the occurrence
of an Event of Default, Pledgor shall be entitled to exercise all voting and other rights pertaining to the Pledged Securities for any
purpose not inconsistent with this Agreement. During the continuance of an Event of Default, Pledgee shall have the sole right, without
notice, to exercise voting and all other rights under or with respect to the Pledged Securities and give consents, waivers and ratifications
in respect thereof, and Pledgor shall deliver to Pledgee such proxies and other documents as Pledgee may request to effectuate the foregoing.

 

	7.	Dividend and Distributions.

 

(a)       Unless
an Event of Default is then continuing, Pledgor shall be entitled to receive and retain any ordinary distributions (including tax distributions)
paid with respect to the Pledged Securities. During the continuance of an Event of Default, all dividends and other distributions and
returns of capital with respect to the Pledged Securities shall be paid to Pledgee and shall be applied by Pledgee to the Obligations
in the manner described in Section 7(b) hereof.

 

(b)       Notwithstanding
the foregoing, Pledgor’s right to receive and retain any and all distributions, dividends and payments in respect of the Pledged
Securities purported to be pledged and assigned by Pledgor hereunder shall be further limited as follows: (i) distributions paid or payable
other than in cash in respect of, and instruments and other property received, receivable or otherwise distributed in respect of, or in
exchange for, any such Pledged Securities; and (ii) distributions paid or payable in cash in respect of any such Pledged Securities in
connection with a partial or total liquidation or dissolution of the Company shall be forthwith delivered to Pledgee to hold and shall,
if received by Pledgor, be received in trust for the benefit of Pledgee, be segregated from the other property or funds of Pledgor and
be forthwith delivered to Pledgee as collateral in the same form as so received (with any necessary endorsement or assignment) to be applied
to the Obligations in such order as Pledgee may determine in its sole and absolution discretion.

 

	8.	Events of Default; Remedies.

 

(a)       During
the continuance of an Event of Default, Pledgee shall be entitled to exercise all of the rights and remedies available to a secured party
under the UCC as may be amended from time to time and other applicable law and all rights and remedies available to it under this Agreement.
In any event, such rights and remedies shall include, without limitation: (i) the right to exercise and enforce its rights under Sections
6 and 7 hereof with respect to the Pledged Securities; and (ii) the right to sell, assign, transfer, endorse and deliver the whole or
any part of the Pledged Securities or any interest therein at public or private sale for cash, upon credit or for other property, for
immediate or future delivery, and for such price or prices and on such terms as Pledgee in its sole discretion shall deem appropriate.
Pledgee shall conduct any such sale of the Pledged Securities effected by it in compliance with (or under an exemption from) applicable
Securities Laws. Upon consummation of any such sale, Pledgee shall have the right to assign, transfer, endorse and deliver to the purchaser
or purchasers thereof the Pledged Securities or any portion thereof so sold. Each such purchaser
at any such sale shall hold the property sold absolutely free from any claim or right on the part of Pledgor and Pledgor does hereby waive
all rights of redemption, stay and appraisal which Pledgor now has or may at any time in
the future have under any rule of law or statute now exiting or hereafter enacted. Pledgee may adjourn any public or private sale from
time to time by announcement at the time and place fixed therefor, and such sale may, without further notice, be made at the time and
place to which it was so adjourned.

 

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(b)       Terms
of Sale. At any sale made pursuant to this Section 8, Pledgee may bid for or purchase, free from any right of redemption, stay and appraisal
on the part of Pledgor (all said rights being also hereby waived and released to the extent permitted by law), any portion of or all the
Pledged Securities offered for sale and may make payment on account thereof by using any claim, or any portion thereof, then due and payable
to Pledgee from Pledgor.

 

(c)       Application
of Proceeds. During the continuance of an Event of Default, the proceeds of the sale or other disposition of any of the Pledged Securities
shall be applied by Pledgee as follows: (i) first, to the payment of the costs and expenses of such sale or other disposition, including
the out-of-pocket expenses of Pledgee and the reasonable fees and expenses of legal counsel
employed in connection therewith, and to the payment of all reasonable costs and expenses incurred by Pledgee in connection with the administration
and enforcement of this Agreement; (ii) second, to the payment of accrued and unpaid interest upon the Obligations described; (iii) third,
to the payment of all unpaid Obligations; and (iv) fourth, any surplus after such application shall
be paid to Pledgor, the representatives and assigns of Pledgor or as otherwise required by law or as a court of competent jurisdiction
may direct.

 

(d)       Notwithstanding
any provision contained herein to the contrary, Pledgor shall neither pursue any recourse nor seek any remedies against Pledgor but shall
exercise all of Pledgor’s rights and remedies available under this Agreement or at law solely with respect to the Pledged Securities.

 

	9.	Further Assurances.

 

Pledgor
agrees to cooperate with Pledgee and to execute and deliver, or cause to be executed and delivered,
all such other papers and to take all such other actions as Pledgee may request from time to time in order to carry out the purposes
of this Agreement. Without limiting the foregoing, Pledgor agrees that all Pledged Securities shall at all times be in such form that
Pledgee may sell, transfer, or otherwise dispose of same without any signature, action, or assistance from Pledgor; and Pledgor agrees
to deliver to Pledgee the Pledged Securities (whether pledged at inception, by substitution or by addition) endorsed in blank and with
executed unit powers, as appropriate and as requested by Pledgee. Pledgor further authorizes Pledgee to file one or more :financing or
continuation statements, and amendments thereto, relative to all or any part of the Pledged Securities without the signature of the Pledgor
where permitted by law. A photocopy or other reproduction of this Agreement or any :financing statement covering the Pledged Securities,
or any part thereof shall be sufficient as a :financing statement where permitted by law.

 

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	10.	Return of Pledged Securities.

 

This
Agreement shall create a continuing pledge, assignment of, hypothecation of and security interest in the Pledged Securities and shall
remain in full force and effect until the irrevocable payment in full of all Obligations or the termination of this Agreement in writing
by Pledgee, whichever occurs first. When all of the Obligations are irrevocably and fully paid and fully discharged, this Agreement shall
terminate (except as otherwise provided herein) and Pledgor shall be entitled to the return of all the Pledged Securities not used or
applied toward payment and discharge of the Obligations, and Pledgee agrees, upon such full payment and discharge of such Obligations,
to return all such Pledged Securities which then may be in its custody hereunder to Pledgor or to whomsoever may be lawfully entitled
to receive the same or as a court of competent jurisdiction shall direct.

 

	11.	Duty of Pledgee; Exercise of Rights and Remedies.

 

Absent
gross negligence or intentional misconduct, Pledgee shall neither have any duty to protect or preserve any of the Pledged Securities nor
any income with respect thereto or as to the preservation of rights against prior parties, nor as to the preservation of any rights pertaining
to any of the Pledged Securities. Pledgor expressly acknowledges that Pledgee has no duty to: (a) insure the Pledged Securities against
hazards; (b) give to Pledgor any notices, account statements, proxies or communications received by Pledgee regarding the Pledged Securities;
(c) perfect or continue perfection of any security interest in the Pledged Securities in favor of Pledgor; (d) inform Pledgor of any decline
in the value of the Pledged Securities or the existence of any option or elections with respect
to the Pledged Securities; (e) take any action to invest or manage the Pledged Securities; (f) exercise, preserve or notify Pledgor
with respect to any exchanges, puts, calls, redemptions, conversions, maturities, offers, tenders and other rights or requirements regarding
the Pledged Securities or Pledgor’ s interest therein; or (g) sue or otherwise take action to preserve Pledgor’s or Pledgee’s
interest in the Pledged Securities. After an Event of Default, Pledgee may exercise its rights and remedies with respect to any of the
Pledged Securities without resort or regard to other security or sources of payment for Pledgor’s
obligations. The foregoing also applies if Pledgee is deemed entitlement holder as to any Pledged Securities.

 

	12.	Terms Subject to Applicable Law.

 

All
rights, powers and remedies provided herein may be exercised only to the extent that the exercise thereof does not violate any applicable
laws and are intended to be limited to the extent necessary so that they will not render this Agreement invalid, illegal or unenforceable.
If any term of this Agreement or any application thereof shall be held to be invalid, illegal or unenforceable, the validity of any other
terms of this Agreement or any other applications of such term shall in no way be affected thereby.

 

	13.	Security Interest Absolute.

 

The
obligations of Pledgor under this Agreement are independent of the Obligations, and a separate action or actions may be brought and prosecuted
against Pledgor to enforce this Agreement. All rights of Pledgee and the assignment, hypothecation and security interest hereunder, and
all obligations of Pledgor hereunder, shall be absolute and unconditional, to the extent permitted by applicable law, irrespective of:
(a) any lack of validity or enforceability of the Indemnity Agreement or any other agreement
or instrument relating to the Obligations; (b) any change in the time, manner or place of payment of or in any other term of, all or any
of the Obligations, or any other amendment or waiver of or any consent to any departure from any document relating to the Obligations,
including, without limitation, any increase in the Obligations resulting from the extension of additional credit to the Company; (c) any
taking, exchange, release or non-perfection of any other collateral, or any taking, release or amendment or waiver of, or consent to departure
from any guaranty, for all or any of the Obligations; (d) any manner of application of collateral,
or proceeds thereof, to all or any of the Obligations, or any manner of sale or other disposition of any collateral for all or any of
the Obligations or any other assets of Secured Party; or (e) any other circumstances which might otherwise constitute a defense available
to, or a discharge of, Pledgor or a third party grantor of a security interest.

 

    		7	 

     

    

 

	14.	Miscellaneous.

 

(a)       Waivers.
No failure to exercise, and no delay in exercising on the part of Pledgee, any right, power or remedy under this Agreement or the Indemnity
Agreement shall operate as a waiver thereof; nor shall any single or partial exercise of any right, power or remedy hereunder or thereunder
preclude any other or further exercise thereof or the exercise of any other right, power, or remedy. The failure of Pledgee to insist
upon the strict observance or enforcement of any provision of this Agreement or the Indemnity Agreement shall not be construed as a waiver
or relinquishment of such provision. Any waiver of any right, power, remedy, term or condition contained herein shall only be effective
if it is in writing and signed by Pledgee and then such waiver or consent shall be effective only in the specific instance and for the
specific purpose for which given. Pledgor hereby waives any claim of marshalling of assets against Pledgee.

 

(b)       Survival
of Agreements. All representations, warranties, covenants and agreements made by Pledgor in this Agreement or in any instrument, document
or certificate furnished hereunder or in connection herewith shall be deemed to have been relied upon by Pledgee, notwithstanding any
investigation heretofore or hereafter made by Pledgee, and shall survive the execution and delivery of this Agreement.

 

(c)       Governing
Law. This Agreement shall be construed in accordance with the laws of the State of Texas, without application of its conflict oflaw principles.

 

(d)       Successors
and Assigns. This Agreement shall be binding upon and shall inure to the benefit of Pledgee and Pledgor and their respective successors
and assigns. This Agreement shall not be assigned by Pledgor.
Pledgee may assign or otherwise transfer all or any portion of its rights in the Pledged Securities, and such assignee shall thereupon
become vested with all of the benefits in respect thereof granted to Pledgee herein or otherwise.

 

(e)       Counterparts;
Amendments. This Agreement may be executed in any number of counterparts, each of which shall be an original, but all of which when taken
together shall be deemed to constitute one and the same agreement. This Agreement may only be amended by a writing executed by Pledgor
and Pledgee.

 

    		8	 

     

    

 

(f)       Headings.
The Section headings set forth in this Agreement are for convenience of reference only and shall not be deemed to define or limit the
provisions hereof or to affect in any way their construction and application.

 

(g)       Notices.
All notices, requests, consents, claims, demands, waivers, and other communications hereunder (each, a “Notice”)
shall be in writing and addressed to the parties at the addresses set forth on the signature page of this Agreement (or to such other
address that may be designated by the receiving party from time to time in accordance with this Section). All Notices shall be delivered
by personal delivery, nationally recognized overnight courier (with all fees pre paid), facsimile or email (with confirmation of transmission)
or certified or registered mail (in each case, return receipt requested, postage pre-paid). Except as otherwise provided in this Agreement,
a Notice is effective only (a) upon receipt by the receiving party, and (b) if the party giving the Notice has complied with the requirements
of this Section.

 

(h)       Reinstatement.
This Agreement shall continue to be effective or be reinstated, as the case may be, if at any time any amount received by Pledgee in respect
of the Obligations is rescinded or must otherwise be restored or returned by Pledgee upon the insolvency or banlauptcy of
Pledger or upon the appointment of any intervenor or conservator of, or trustee or similar official for Pledger or any substantial
part of its assets, or otherwise, all as though such payments had not been made.

 

[Signature Page Follows]

 

    		9	 

     

    

 

IN WITNESS WHEREOF, the parties have
executed the foregoing Securities Pledge Agreement as of the Effective Date.

 

	PLEDGOR:	 
	 	 
	/s/
    James Walesa	 
	James Walesa, Individually	 
	 	 
	Address for Notices:	 
	c/o
                                            Allied Integral United, Inc.

                                                       8800
                                            Village Drive. 2nd Floor

                                                       San
                                            Antonio, TX 78217
	 

 

	PLEDGEE:	 
	 	 	 
	ALLIED INTEGRAL UNITED, INC.,	 
	A Delaware corporation	 
	 	 	 
	By:		 
	 	Name:	 
	 	Title:	 
	 	 	 
	Address
for Notices:

	 
	8800 Village Drive. 2nd Floor

                                             San Antonio, TX 78217

                                             Attention:
Secretary

	 

 

    		10	 

     

    

 

Schedule A

Pledged
Securities

 

	1.	Stock of Allied Integral United, Inc.
	 	 	 	 
	 	 	a.	140,091.00 shares of Corporation’s common stock (ATIJ Common Stock)
	 	 	 	 
	 	 	b.	48,500.00 warrants to purchase ATIJ Common Stock
	 	 	 	 
	 	 	c.	181,659.00 shares of the Corporation’s 6.75% Series A Cumulative Convertible Preferred Stock, par value $0.01 per share and all accrued interest thereon
	 	 	 	 
	2.	Stock of AIU Alternative Care, Inc.
	 	 	 	 
	 	 	a.	48,500.00 shares of the 10.25% Series I Cumulative Convertible Preferred Stock, par value $0.01 per share, of ATIJ Alternative Care, Inc., and all accrued interest thereon

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