Document:

Exhibit 10.46

 

SECURITY AGREEMENT

 

THIS SECURITY AGREEMENT
is made and entered into as of December 26, 2018, by and between APPLIANCESMART, INC., a Minnesota corporation ("Debtor")
and APPLIANCE RECYCLING CENTERS OF AMERICA, INC., a Minnesota corporation ("Secured Party") whose addresses are
set forth below.

RECITALS

 

A.       APPLIANCESMART
HOLDINGS, LLC, a Nevada limited liability company ("Holdings"), is indebted to Secured Party pursuant to the terms
of that certain Amended and Restated Secured Promissory Note dated as of December 26, 2018 issued by Holdings in favor of Secured
Party ("Note"). Debtor guaranteed the repayment of Holdings' obligations under the Note pursuant to that certain
Agreement and Guaranty by Debtor in favor of Secured Party dated as of December 26, 2018 (the "Guaranty"). Debtor
is a wholly-owned subsidiary of Holdings.

 

B.       Debtor
has agreed to grant Secured Party a security interest in certain assets to secure, among other things, Debtor's obligations under
the Guaranty.

 

NOW, THEREFORE,
in consideration of the credit extended under the Note and for the purpose of securing Debtor's obligations to Secured Party under
the Guaranty, the parties agree as follows:

 

1.       Grant
of Security Interest:  Collateral.  To secure the Secured Obligations described in Section 2, the
Debtor hereby grants to the Secured Party a security interest ("Security Interest") in the property described
on Exhibit A attached hereto ("Collateral").

 

2.       Secured
Obligations.  The following obligations are secured by this Agreement (collectively referred to as the "Secured
Obligations"):

 

(a)       All
obligations of Holdings under the Note and all obligations of Debtor to Secured Party under the Guaranty;

 

(b)       Any
and all sums advanced by the Secured Party in order to preserve the Collateral or to perfect its security interest in the Collateral;
and

 

(c)       Upon
the occurrence and during the continuation of an Event of Default (as defined below), all reasonable expenses, including attorneys'
fees and court costs, incurred by the Secured Party in (i) any proceeding to enforce the collection of the Secured Obligations,
(ii) retaking, holding or otherwise disposing of or realizing on the Collateral, or (iii) the exercise of any of its rights under
this Agreement or applicable law.

 

3.       Debtor's
Representations, Warranties and Covenants. Debtor represents, warrants and covenants that:

 

(a)       Debtor
has title to the Collateral, free of all liens and encumbrances, except the Security Interest created hereby, as the same may hereafter
be amended from time to time. Debtor has full corporate power and authority to execute this Security Agreement, to perform Debtor's
obligations hereunder and to subject the Collateral to the Security Interest created hereby.

 

(b)       Debtor
will, at any time or times hereafter, execute such financing statements and other instruments and perform such other acts as the
Secured Party may reasonably request in order to establish, maintain, perfect and enforce Secured Party's valid and perfected Security
Interest in the Collateral and its rights under this Agreement.

 

(c)       Except
in the ordinary course of Debtor's business, Debtor will not sell, transfer, lease, hypothecate, pledge or otherwise dispose of
any of its rights or interests in the Collateral without the prior written consent of the Secured Party.

 

 

 

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(d)       Debtor
will keep the Collateral in good condition, ordinary wear and tear excepted, and insured against such risks and in such amounts
consistent with Debtor's past practice, with Secured Party to be named loss payee on all insurance on the Collateral. From time
to time Debtor shall furnish to Secured Party, upon request, appropriate evidence of the carrying of such insurance.

 

(e)       Debtor
will use the Collateral in a lawful manner consistent with this agreement and with the terms and conditions of any policy of insurance
thereon.

 

(f)       Following
the occurrence of an Event of Default, the Secured Party, in the name of the Debtor, shall have the authority but shall not be
obligated to take any action which the Secured Party may deem necessary or desirable in order to realize on the Collateral.

 

(g)       Debtor
will forward directly to the Secured Party any and all written material notices, agreements or documents of any kind or nature
received by Debtor on account of any of the Collateral.

 

4.Events of
Default.The occurrence of any of the following events shall constitute an "Event of Default" under this
Security Agreement:

 

(a)       The
occurrence of an event of default under the terms of any of the Secured Obligations, including, without limitation, nonpayment
of any of the Secured Obligations when due, whether by acceleration or otherwise;

 

(b)       The
nonperformance of any covenant, or material breach of any representation or warranty, made by Debtor in the Note or this Agreement;

 

(c)       Except
in the ordinary course of Debtor's business, the sale, lease or other disposition of Debtor's interests or rights in the Collateral;

 

(d)       Without
the prior consent of Secured Party, the creation of any encumbrance upon the Collateral or the making of any levy, judicial seizure
or attachment thereof or thereon; or

 

(e)       The
appointment of a receiver for any part of the property of Debtor, the making by Debtor of an assignment for the benefit of creditors
or the initiation by or against Debtor of any proceeding under the Federal Bankruptcy Code or any state insolvency law.

 

5.       Remedies
Upon Event of Default.  Upon the occurrence of an Event of Default for so long as such Event of Default is continuing,
in addition to all the rights and remedies provided under applicable law, the Secured Party may at its option and without demand
and upon written notice to Debtor, declare all or any part of the unmatured Secured Obligations immediately due and payable, and
the Secured Party may exercise, in addition to the rights and remedies granted hereby, all rights and remedies of a secured party
under the Uniform Commercial Code or any other applicable law. The Secured Party may, at its option, dispose of the Collateral
by public or private sale if Secured Party has given notice to Debtor of the intended disposition in accordance with the provisions
of Section 6 hereof and the Uniform Commercial Code and other applicable law. The Debtor agrees, upon Secured Party's request,
to use commercially reasonable efforts to cooperate with the Secured Party and do all things reasonably necessary to enable Secured
Party to sell the Collateral in compliance with all applicable laws and regulations. Debtor shall pay to Secured Party any deficiency
remaining after such application and any excess proceeds of such sale shall be paid over by Secured Party to Debtor. The bringing
of an action or an entry of judgment against the Debtor shall not bar the Secured Party's right to repossess any or all of the
Collateral.

 

6.       Miscellaneous.
This Agreement can be waived, modified, amended, terminated or discharged, and the Security Interest can be released, only explicitly
in a writing signed by Secured Party. A waiver signed by Secured Party shall be effective only in the specific instance and for
the specific purpose given. Mere delay or failure to act shall not preclude the exercise or enforcement of any of Secured Party's
rights or remedies. All rights and remedies of Secured Party shall be cumulative and may be exercised singularly or concurrently,
at Secured Party's option, and the exercise or enforcement of any one such right or remedy shall neither be a condition to nor
bar the exercise or enforcement of any other. All notices to be given to Debtor shall be deemed sufficiently given if delivered
or mailed by registered or certified mail, postage prepaid, or, except to the extent required by applicable law, sent by facsimile
or electronic mail, to Debtor at its address set forth below or at the most recent address shown on Secured Party's records. Notices
sent by facsimile shall be deemed to have been given when sent, and notices and other communications sent to an e-mail address
shall be deemed received upon the sender’s receipt of an acknowledgement from the intended recipient. All required notices
to Debtor pertaining to any intended disposition of Collateral or other actions shall be deemed timely if given 10 days prior to
the action described in the notice. Secured Party's duty of care with respect to Collateral in its possession (as imposed by law)
shall be deemed fulfilled if Secured Party exercises reasonable care in physically safekeeping such Collateral. Debtor will reimburse
Secured Party for all expenses (including reasonable attorneys' fees and legal expenses) incurred by Secured Party in the protection,
defense, or enforcement of the Security Interest, including expenses incurred in any litigation or bankruptcy or insolvency proceedings.
This Agreement shall be binding upon and inure to the benefit of Debtor and Secured Party and their respective heirs, representatives,
successors and assigns and shall take effect when signed by Debtor and delivered to Secured Party. Except to the extent otherwise
required by law, this Agreement shall be governed by the internal laws of Minnesota and, unless the context otherwise requires,
all terms used herein which are defined in the Uniform Commercial Code, as in effect in Minnesota, shall have the meanings therein
stated. If any provision or application of this Agreement is held unlawful or unenforceable in any respect, such illegality or
unenforceability shall not affect other provisions or applications which can be given effect, and this Agreement shall be construed
as if the unlawful or unenforceable provision or application had never been contained herein or prescribed hereby. All representations
and warranties contained in this Agreement shall survive the execution, delivery and performance of this Agreement and the creation
and payment of the Secured Obligations.

 

 

[Signatures on following page]

 

 

 

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        ADDRESSES:

         

         

        325 E. Warm Springs Road

        Suite 102

        Las Vegas, NV 89119

        Attention: Jon Isaac

         

         

        with a copy to:

         

        Live Ventures Incorporated

        325 E. Warm Springs Road, Suite 102

        Las Vegas, NV 89119

        Attn: Michael J. Stein, Esq.

        Email: mstein@liveventures.com

         

         

         

         

         

         

         

         

         

        175 Jackson Avenue North

        Suite 102

        Minneapolis, MN 55343

        Attention: Tony Isaac
	
         

        DEBTOR:

         

        APPLIANCESMART INC., a Minnesota corporation

         

         

        By: /s/ Jianne Demeroutis

        Name: Jianne Demeroutis

        Title: President

         

         

         

         

         

         

         

         

         

         

         

         

         

         

         

         

        SECURED PARTY:

         

        APPLIANCE RECYCLING CENTERS OF AMERICA,
        INC., a Minnesota corporation

         

         

        By: /s/ Tony Isaac

        Name: Tony Isaac

        Title: Chief Executive Officer

         

         

         

         

 

 

 

 

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Exhibit A

 

Description of Collateral

 

All of the personal
property and Fixtures of the Debtor, including without limitation the following, whether now owned or hereafter arising or acquired:

 

(a)             
Accounts, including all other rights and interests (including all liens and security interests) that the Debtor may at any
time have by law or agreement against any Account Debtor or other obligor obligated to make any such payment or against any of
the property of such Account Debtor or other obligor;

 

(b)            
Equipment and Fixtures, including all accessories, parts and other property at any time affixed thereto or used in connection
therewith and all substitutions and replacements thereof;

 

(c)             
Inventory, including goods that are returned, repossessed, stopped in transit or which otherwise come into the possession
of the Debtor;

 

(d)            
General Intangibles, including payment intangibles, inventions, designs, patents, patent applications, design patents, design
patent applications, trademarks, trademark applications, trade names, trade secrets, goodwill, copyrights, registrations, licenses,
franchises, customer lists, tax refund claims, rights to indemnification, rights under warranties, all domain names, together with
all contracts, agreements, licenses and registrations relating to such domain names, and Commercial Tort Claims, if any;

 

(e)             
Chattel Paper, Instruments and Documents;

 

(f)             
Investment Property;

 

(g)            
Deposit Accounts;

 

(h)            
Letter-of-Credit rights;

 

(i)              
Supporting Obligations;

 

(j)              
Intellectual Property Collateral;

 

(k)            
books, correspondence, credit files, records, invoices, manuals, service records and programs, other papers and documents,
computer records, runs, software, systems, procedures, disks, tapes and other storage media relating to any of the Collateral,
including any of the foregoing in the possession or control of any service, consultant, or outside vendor; and

 

(l)              
Proceeds, including all policies, claims to payment under, and proceeds of any and all insurance policies payable to the
Debtor, or on behalf of the Debtor's property, whether or not such policies are issued to or owned by the Debtor and whether or
not the Bank is named as loss payee or additional insured, including any credit insurance.

 

 

 

    	 	4Exhibit 10.57

 

Employment Agreement

 

This Employment Agreement,
this Agreement", shall be effective at 12:01 a.m., Eastern Daylight Time, on January 22, 2018 (the "Effective Date"),
by and between Marquis Industries, Inc., a Georgia corporation, "Marquis" or the "Employer", and Weston A.
Godfrey Jr, a Georgia resident, "Godfrey", and their respective heirs, successors and permitted assigns.

 

Witnesseth:

 

Whereas, the
Employer desires to retain Godfrey and Godfrey desires to be employed by Employer, in each case on the terms and subject to the
conditions set forth herein;

 

Now, therefore,
in consideration of the aforementioned premises and other good and valuable consideration, the receipt and sufficiency of which
are acknowledged, the parties hereto, intending to be legally bound hereby, agree as follows:

 

	 	1.	Position and Duties.

 

During the Term (as defined below), from the Effective Date until July 1, 2018, Godfrey shall serve as Executive
Vice President and shall report to Timothy A. Bailey, the Chief Executive Officer of Employer, and from July 1, 2018 through the
remainder of the Term, Godfrey shall serve as the Chief Executive Officer of Employer and shall report to Jon Isaac ("Isaac")
and the Board of Directors (the "Board") of Marquis Affiliated Holdings., LLC, "Holdings". While he is Executive
Vice President, Godfrey shall "shadow" the Chief Executive Officer and upon mutual agreement of Godfrey and the Chief
Executive Officer, Godfrey shall manage all the Employer's department managers. While he is Chief Executive Officer, Godfrey shall
be primarily responsible for managing the Marquis Business (as defined below) and coordinating its finance, manufacturing, and
sales activities to increase its growth and profitability: Godfrey shall perform diligently such duties and such other duties
as are customarily performed by executive vice presidents and chief executive officers, as the case may be, of comparable companies
in the same or similar industry as the Marquis Business, together with such other duties as may be reasonably required from time
to time by Isaac or the Board, which duties shall be consistent with his position as set forth above. Godfrey shall from time
to time report to Isaac and the Board bn all matters within his knowledge that should be brought to Isaac's and the Board's attention.
Godfrey shall see that all resolutions and orders of the Board are carried into effect, and in connection with the foregoing,
shall be authorized to delegate to the other officers and employees of, or consultants to, Employer such of his powers and duties
as he deems advisable. Godfrey shall, if requested, also serve as an officer or director of any subsidiary of Marquis for no additional
compensation, provided that service as an officer or director of any such subsidiary shall not substantially expand the duties
of Godfrey under this Agreement. Godfrey's principal place of work shall be 2743 Highway 76, Chatsworth, Georgia 30705, unless
otherwise mutually agreed by the parties.

 

	 	2.	Term.

 

Godfrey shall be employed by Employer hereunder
for a term commencing on the Effective Date and expiring on September 30, 2023, unless terminated earlier pursuant to Section 5
or Section 6 of this Agreement. The period during which Godfrey is employed by Employer hereunder is referred to herein as the
"Term". The Term may be extended by mutual agreement of the parties.

 

	 	3.	Salary, Benefits and Bonus Opportunities.

 

Salary and Benefits

 

Godfrey shall be paid an annual salary
of Two Hundred Eighty-five Thousand Dollars ($285,000), payable in periodic installments in accordance with the Employer's customary
payroll practices.

 

 

 

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Godfrey shall be entitled to (i) receive
a car allowance of One thousand ($1,000) dollars per month during the Term, (ii) receive family health and dental insurance at
Employer's expense, and other benefits offered to Employer's executive management, but excluding participation in executive management
bonus pool, on such terms and conditions as offered to other members of Employer's executive management, (iii) a $1.0 million term
life insurance policy provided by or paid for in full by Employer, and (iv) a family membership to the Bradley Wellness Center
paid for in full by for by Employer. Marquis shall reimburse Godfrey for actual, documented relocation expenses of up to Five Thousand
Dollars ($5,000). If Godfrey leaves Marquis voluntarily or is terminated for Cause within one year of hire, Godfrey is responsible
for reimbursing Marquis 100% of the relocation costs within thirty (30) days of such separation or termination. In that event,
to the extent permissible under applicable law, the Employer may offset the amount of the relocation benefits owed by Godfrey from
any compensation due to Godfrey upon his separation or termination of employment.

 

Annual Bonus

 

A performance bonus, if any,
shall be paid annually ("Annual Bonus") commencing with First Production Bonus Period as follows and in accordance with
the terms of this Section 3 (including, but not limited to, the deduction of the Minimum Annual Bonus"):

 

	EBITDA Excess	 	Bonus Amount
	Equal to or greater than $1.0 million and less than $2.0 million	 	$100,000
	 	 	 
	Equal to or greater than $2.0 million and less than 3.0
million	 	$100,000
	 	 	 
	Equal to or greater than $3.0 million and less
        than $4.0 million	 	$100,000
	 	 	 
	Equal to or greater than $4.0 million and for
        each $1.0 million increment thereafter	 	$100,000

 

Godfrey shall be entitled
to a minimum Annual Bonus of Seventy-five Thousand Dollars ($75,000) (the "Minimum Annual Bonus"), which, for the avoidance
of doubt, shall not be pro-rated during the period commencing on the Effective Date and ending September 30, 2018 (the "Stub
Period"); Godfrey shall not be entitled to any additional Annual Bonus other than the Minimum Annual Bonus during the Stub
Period. The amount of the Minimum Annual Bonus shall be deducted from any Annual Bonus actually paid by Employer to Godfrey during
each year of the Term.

 

Any Annual Bonus is calculated
incrementally. For example purposes only, assume that as of September 30, 2019, Marquis generates $3.0 million of EBITDA Excess.
Godfrey would be entitled to his Minimum Annual Bonus in addition to an Annual Bonus equal to $225,000 ($100,000 plus
$100,000 plus $100,000), less the $75,000 minimum Annual Bonus.

 

"EBITDA" means
with respect to each Annual Bonus, operating earnings adjusted to exclude special items and impairments, (gain)/loss on sale of
assets, interest, income tax expense, depreciation, payments made to affiliates of Marquis, and amortization that are directly
related to the operations of Marquis's business.

 

"EBITDA Excess"
means the actual amount of EBITDA in excess of Marquis' EBITDA for the immediately prior TTM period determined as follows: Marquis's
actual EBITDA for the first two TTM periods shall be $10,750,000, and thereafter an amount equal to 90% of the previous TTM's EBITDA.

 

"TTM" means the
trailing twelve months with the first period commencing on October 1, 2018 and continuing until September 30, 2019 (the "First
Production Bonus Period"); the second period commencing on October 1, 2019 and continuing until September 30, 2020, and so
on for the remainder of the Term.

 

Change of Control Bonus

 

In the event of a Change
of Control (as defined below), Marquis shall pay Godfrey an aggregate amount equal to $660,000 within 10 business days following
the closing of such Change of Control.

 

 

 

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"Change of Control" means:

 

(i) the sale, lease, exchange, transfer
or other disposition, including the disposition of Marquis through bankruptcy proceedings (other than liens and encumbrances created
in the ordinary course of business, including liens or encumbrances to secure indebtedness for borrowed money that are approved
by Marquis's Board of Directors,) of all or substantially all of Marquis's property and assets; provided that any sale, lease,
exchange or other disposition of property or assets exclusively between or among Marquis and any direct or indirect subsidiary
or subsidiaries of Marquis shall not be deemed a "Change of Control"; and (ii) the merger, consolidation,
business combination, or other similar transaction of Marquis with any other entity; provided, however, that a merger, consolidation,
business combination, or other similar transaction that would result in (1) the voting securities of Marquis outstanding immediately
prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving
entity or its parent) more than 50% of the total voting power represented by the voting securities of the surviving entity and
(2) more than 50% of the total number of outstanding shares of the surviving entity's capital stock, in the case of clauses (I)
and (2) above as outstanding immediately after such merger, consolidation, business combination, or other similar transaction,
and the stockholders of Marquis immediately prior to the merger, consolidation, business combination, or other similar transaction
own voting securities of Marquis, the surviving entity or its parent immediately following the merger, consolidation, business
combination, or other similar transaction in substantially the same proportions (vis a vis each other) as such stockholders owned
the voting securities of the Corporation immediately prior to the transaction shall not be deemed a "Change of Control",
and solely for purposes of this proviso, so long as there is no (i) material reduction, without Godfrey's consent, of Godfrey's
base salary, unless the reduction is generally applicable to substantially all senior executives of Marquis, (ii)' material reduction
on an aggregate basis of the benefits provided to Godfrey under Marquis's benefits plans, unless the reduction is generally applicable
to substantially all senior executives of Marquis, (iii) substantial diminution in Godfrey's authority or duties that is materially
inconsistent with his position of Chief Executive Officer prior to such Change of Control without Godfrey's consent; and (iv) relocation
of more than 50 miles from Godfrey's principal place of work that also increases the commute from Godfrey's principal residence
by more than 50 miles.

 

	 	4.	Exclusivity.

 

During the Term, Godfrey shall work full
time for Employer and shall not consult, advise, or otherwise engage in any other business activity other than serving on the Board
of Directors or providing other service to one or more organizations that are qualified under Section 501 (c)(3) of the Internal
Revenue Code.

 

	 	5.	Termination for Cause.

 

Employer may terminate Godfrey for
Cause. "Cause" shall be defined as: (1) abandonment or willful failure to perform Godfrey's duties as described in
the employment agreement; (2) embezzlement, misappropriation, fraud, or dishonesty involving Marquis's business; (3)
violation of any law involving Marquis that has an adverse impact on the business or reputation of Marquis or its parent or
any of its subsidiaries or affiliates; (4) conviction of or plea of guilty or nolo contendere to a crime that constitutes a
felony (or state law equivalent) or a crime that constitutes a misdemeanor involving moral turpitude; (5) commission of an
act of fraud; (6) suspension or bar by the U.S. Securities and Exchange Commission or Financial Industry Regulatory Authority
from employment or association with a publicly-traded company; or (7) breach of a material provision of this Agreement
without cure by the Executive within thirty (30) days from the date written notice of the alleged breach has been given to
the Executive by Employer.

 

	 	6.	Termination for Death or Disability.

 

Employer may terminate Godfrey without
Cause, including, but not limited to, in the event that Godfrey becomes permanently disabled or is prevented by injury or sickness
from attention to his duties hereunder for six consecutive weeks or more (collectively, "Disability"). Godfrey's employment
hereunder shall terminate automatically in the event of his death during the Term.

 

 

 

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	 	7.	Impact of Termination.

 

In the event that Godfrey is
terminated by the Employer for Cause pursuant to Section 5 or without Cause, including by reason of Godfrey's Disability prior
to the expiration of the Term, his accrued but unpaid salary shall be paid through the date of termination. In the event that
Godfrey is terminated by Employer without Cause other than because of Godfrey's death or Disability, Godfrey shall continue to
receive (i) his unpaid annual salary for a period of twelve (12) months following such termination and (ii) fully paid family
coverage of health and dental insurance at Employer's expense until the earlier of twelve (12) months after such termination or
the date of Godfrey's employment. After termination of employment for any reason, Godfrey shall (i) return or cause to be returned
any personal computer used by him to the Employer, and return or cause to be returned ,to the Employer all personal property of
the Employer (except his cell phone, which Godfrey may retain) and all documents and materials belonging to the Employer and stored
in any fashion, whether or not those constitute or contain any Confidential Information or Work Product (as such terms are defined
below), that are in the possession, custody, or control of Godfrey, whether they were provided to Godfrey by the Employer or any
of its business associates or created by Godfrey in connection with his employment by Godfrey, (ii) delete or destroy all copies
of any such documents and materials not returned to the Employer that remain in Godfrey's possession or control, including those
stored on any non-Employer devices, networks, storage locations, and media in Godfrey's possession or control (including the retained
cell phone), (iii) execute (and not revoke) a mutually agreeable general release of claims in favor of the Employer and (iv) comply
with post-termination obligations and terms of release.

 

Upon termination of Godfrey's employment
hereunder for any reason, Godfrey shall be deemed to have resigned from all positions that Godfrey holds as an officer or member
of the board of directors (or a committee thereof) of the Employer and any of its subsidiaries or affiliates.

 

	 	8.	Covenants Not to Compete, Solicit or to Use or Disclose Confidential Information

 

	 	8.1	Definitions.

 

For purposes of this Section 8:

 

"Compete" means to, directly
or' indirectly, own, manage, control, or participate in the ownership, management, or control of, or be employed or engaged by
or otherwise affiliated or associated as a consultant, independent contractor. or otherwise with, any Competitor, or otherwise
directly or indirectly engage in any Restricted Business targeted to the Restricted Area.

 

"Competitor" means any person
or entity (other than Employer or its subsidiaries) who undertakes any Restricted Business in the Restricted Area, regardless of
whether or not the Competitor is physically located inside or outside the Restricted Area.

 

"Confidential Information" means
and includes any and all of the following information, whether in writing, orally, electronically or otherwise: (i) all information
that is a trade secret under applicable trade secret or other law; (ii) all information concerning product specifications, data,
know-how, formulae, compositions, processes, designs, sketches, photographs, graphs, drawings, samples, inventions and ideas, past,
current, and planned research and development, current and planned manufacturing or distribution methods and processes, customer
lists, current and anticipated customer requirements, price lists, market studies, business plans. computer hardware, software
source and object code and computer software, and database technologies, systems, structures, and architectures; (iii) all information
concerning the—business and affairs of Holdings,
Marquis, or any subsidiary or affiliate of Marquis (which includes historical and current financial Statements, financial projections
and budgets, tax returns and accountants' materials, historical, current, and projected sales, capital spending budgets and plans,
business plans, strategic plans, marketing and advertising plans, publications, client and customer lists and files, contracts,
the names and backgrounds of key personnel, and personnel training techniques and materials, however documented); and (iv) all
notes, analyses, compilations, studies, summaries, and other material prepared by any person or entity to the extent containing
or based, in whole or in part, upon any information included in the foregoing. "Confidential Information" does not include
information that is or becomes publicly known or available through no wrongful act of Godfrey.

 

 

 

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"Customer" means any current,
former, or prospective customer of Holdings. Marquis, or any subsidiary of Marquis.

 

"Marquis Business" means,
individually and collectively, all businesses that Marquis or any of its subsidiaries conducts, or has conducted or has undertaken
or planned to conduct or undertake, including the extrusion and sale of specialty yams and the manufacture and sale of carpet,
rugs, and hard surfaces through multiple distribution channels, as such business may be expanded or changed during the Term.

 

"Restricted Area" means within
fifty (50) miles of Godfrey's principal place of work at the time of termination of this Agreement.

 

"Restricted Business" means any
business that is competitive with the Marquis Business in the Restricted Area.

 

"Restriction Period" means the
period commencing on the Effective Date of this Agreement and ending on the date that is the second (2nd) anniversary of the date
of termination of this Agreement.

 

	 	8.2	Covenant Not to Compete.

 

During the Restriction
Period, Godfrey shall not Compete. Notwithstanding the foregoing, Godfrey is permitted to own up to five percent (5%) of the
outstanding capital stock or other equity interests of any publicly-traded entity that is or, during any relevant period
becomes, a Competitor.

 

	 	8.3	Covenant Not to Solicit Customers or Employees.

 

During the Restriction Period, Godfrey
shall not, directly or indirectly, for himself or another, (i) solicit Customers for any purpose related to a Restricted Business
or (ii) solicit the employment of, assist in the soliciting of the employment of, or otherwise solicit the association in business
with, any employee or officer of Holdings, Marquis, or any subsidiary or affiliate of Marquis, or induce any person who is an employee,
officer, agent, or contractor of Holdings, Marquis. or any subsidiary or affiliate of Marquis, to terminate such relationship,
or to join with Godfrey or any other person or entity for the purpose of leaving the employ or such other relationship with Holdings,
Marquis, or any subsidiary or affiliate of Marquis, and undertaking any form of business.

 

	 	8.4	Covenant Not to Use or Disclose Confidential Information.

 

Godfrey shall not, directly or indirectly,
during the Restriction Period release or divulge any Confidential Information whatsoever relating to Holdings, Marquis, or any
subsidiary or affiliate of Marquis to any person or entity other than Holdings, Marquis, or any subsidiary or affiliate of Marquis
without the prior written consent of Holdings, unless compelled to do so by legal process or subpoena or in the performance of
Godfrey's duties under this Agreement consistent with the Employer's policies or (ii) use any Confidential Information of Holdings,
Marquis, or any subsidiary or affiliate of Marquis for Godfrey's own benefit or for the benefit of any person or entity other than
Holdings, Marquis, or any subsidiary or affiliate of Marquis.

 

	 	8.5	Non-disparagement.

 

Godfrey agrees and covenants that he will
not at any time make, publish, or communicate to any person or entity or in any public forum. any defamatory or disparaging remarks,
comments, or statements concerning Employer or any of its subsidiaries or affiliates or any of the businesses, employees, officers,
existing and prospective customers, suppliers, investors, and other associated third parties of Employer or any of its subsidiaries
or affiliates.

 

 

 

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	 	8.6	Covenants Extended Pursuant to Execution and Delivery of this Agreement.

 

For purposes of this Section 8:

 

(a)       Godfrey
acknowledges and agrees that the obligations of this Section are necessary in order to protect the legitimate business interests
of the Employer and such obligations are reasonably related to such end.

 

(b)      Godfrey
understands that the nature of his position gives him access to and knowledge of Confidential Information and places him in a
position of trust and confidence with Holdings and Marquis. Godfrey understands and acknowledges that the services he is to provide
to Holdings and Marquis are unique, special, or extraordinary. Godfrey further understands and acknowledges that the ability of
Holdings and Marquis to reserve these for the exclusive knowledge and use of Holdings and Marquis is of great competitive importance
and commercial value to the Holdings and Marquis, and that improper use or disclosure by Godfrey is likely to result in unfair
or unlawful competitive activity.

 

(c)       Godfrey further acknowledges that the amount of his compensation reflects, in part, his obligations and the rights of Holdings
and Marquis under this Section 8; that he has no expectation of any additional compensation, royalties, or other payment of any
kind not otherwise referenced herein or in the Purchase Agreement in connection herewith; and that he will not be subject to undue
hardship by reason of his full compliance with the terms and conditions of this Section 8 or the enforcement thereof by Holdings
or Marquis.

 

	 	8.7	Injunctive Relief.

 

In the event of any breach or threatened
breach of the covenants set forth in this Section 8, Godfrey acknowledges that the damage to the Employer would be irreparable
and that the Employer would be entitled to immediate injunctive relief from any court of competent jurisdiction, without the necessity
of posting bond or showing any actual damages or that money damages would not afford an adequate remedy, to staunch the damage
caused by the breach. The aforementioned equitable relief shall be in addition to, not in lieu of, legal remedies, monetary damages,
or other available forms of relief.

 

	 	9.	Proprietary Rights.

 

	 	9.1.	Work Product.

 

Godfrey acknowledges and
agrees that all writings, works of authorship, technology, inventions, discoveries, ideas, and other work product of any
nature whatsoever, that are created, prepared, produced, authored, edited, amended, conceived, or reduced to practice by
Godfrey, individually or jointly with others, during the period of his employment by Employer and relating in any way to the
Marquis Business or research or development for the Marquis Business (regardless of when or where the Work Product is
prepared or whose equipment or other resources is used in preparing the same) and all printed, physical, and electronic
copies, all improvements, rights, and claims related to the foregoing, and other tangible embodiments thereof (collectively,
"Work Product"), as well as any and all rights in and to copyrights, trade secrets, trademarks (and related
goodwill), mask works, patents, and other intellectual property rights therein arising in any jurisdiction throughout the
world and all related rights of priority under international conventions with respect thereto, including all pending and
future applications and registrations therefor, and continuations, divisions. continuations-in-part, reissues, extensions,
and renewals thereof (collectively, "Intellectual Property Rights"), shall be the sole and exclusive property of
Employer.

 

	 	9.2	Work Made for Hire; Assignment.

 

Godfrey acknowledges that, by reason of
being employed by Employer at the relevant times, to the extent permitted by law, all of the Work Product consisting of copyrightable
subject matter is "work made for hire" is defined in 17 U.S.C. § 101 and such copyrights are therefore owned by
Employer. To the extent that the foregoing does not apply, Godfrey hereby irrevocably assigns to Employer, for no additional consideration,
Godfrey's entire right, title, and interest in and to all. Work Product and Intellectual Property Rights therein, including the
right to sue, counterclaim, and recover for all past, present, and future infringement, misappropriation, or dilution thereof,
and all rights corresponding thereto throughout the world. Nothing contained in this Agreement shall be construed to reduce or
limit Employer's rights, title, or interest in any Work Product or Intellectual Property Rights so as to be less in any respect
than that Employer would have had in the absence of this Agreement.

 

 

 

    	 	6	 

     

    

 

	 	9.3	Further Assurances; Power of Attorney.

 

During and after his employment, Godfrey
agrees to cooperate reasonably with Employer to (a) apply for, obtain, perfect, and transfer to Employer the Work Product. as well
as an Intellectual Property Right in the Work Product in any jurisdiction in the world and (b) maintain, protect, and enforce the
same, including, without limitation, executing and delivering to Employer any and all applications, oaths, declarations, affidavits,
waivers, assignments, and other documents and instruments as shall be requested by Employer. Godfrey hereby irrevocably grants
Employer power of attorney to execute and deliver any such documents on Godfrey's behalf in his name and to do all other lawfully
permitted acts to transfer the Work Product to Employer and further the transfer, issuance, prosecution, and maintenance of all
Intellectual Property Rights therein, to the full extent permitted by law, if Godfrey does not promptly cooperate with Employer's
request (without limiting the rights Employer shall have in such circumstances by operation of law). The power of attorney is coupled
with an interest and shall not be affected by Godfrey's subsequent incapacity.

 

	 	9.4	No License.

 

Godfrey understands that this Agreement
does not, and shall not be construed to, grant Godfrey any license or right of any nature with respect to any Work Product or Intellectual
Property Rights or any Confidential Information, materials, software, or other tools made available to him by Employer.

 

	 	10.	Miscellaneous.

 

	 	10.1	Titles Descriptive; Interpretation.

 

Titles are descriptive and not substantive
parts of this Agreement. For purposes of this Agreement, (a) the words "include," "includes," and "including"
shall be deemed to be followed by the words "without limitation"; (b) the word "or" is not exclusive; and (c)
the words "herein," "hereof," "hereby," "hereto," and "hereunder" refer to this
Agreement as a whole.

 

	 	10.2	Negotiated Agreement.

 

The parties hereto have each been represented by counsel, and
this Agreement has been negotiated and shall not be construed against one party or the other.

 

	 	10.3	Governing Law.

 

This Agreement shall be governed by Georgia law without regard
to its choice of law provisions.

 

	 	10.4	Severability.

 

If any portion of this Agreement is held
illegal or unenforceable, such portion or portions shall be absolutely and completely severable from all other provisions of this
Agreement, and such other provisions shall constitute the agreement of the parties hereto with respect to the subject matter hereof.
On such determination that a portion of this Agreement is illegal or unenforceable, the parties hereto shall negotiate in good
faith to modify this Agreement so as to effect the original intent of such parties as closely as possible in a mutually acceptable
manner in order that the transactions contemplated hereby be consummated as originally contemplated to the greatest extent possible.

 

	 	10.5	Counterparts, Signatures.

 

This Agreement may be executed in counterparts,
each of which shall for all purposes be deemed an original, and all of such counterparts shall together constitute one and the
same agreement. The Agreement may be executed via signature exchanged by facsimile or pdf, which signature shall be as valid as
an original.

 

 

 

    	 	7	 

     

    

 

	 	10.6	Arbitration.

 

The parties hereto have agreed that
any dispute arising out of or relating to this Agreement (a "Dispute") shall be resolved in accordance with the
procedures set forth in this Section 10.06. Until completion of such procedures, no party hereto may take any action not
contemplated herein to force a resolution of the Dispute by any judicial, arbitral, or similar process, except to the limited
extent necessary to (i) avoid expiration of a claim that might eventually be permitted hereby or obtain interim relief,
including injunctive relief, to preserve the status quo or prevent irreparable harm. All communications between the parties
hereto or their representatives in connection with the attempted resolution of any Dispute shall be confidential and deemed
to have been delivered in furtherance of Dispute settlement and shall be exempt from discovery and production, and shall not
be admissible in evidence (whether as an admission or otherwise) in any arbitral or other proceeding for the resolution of
the Dispute or otherwise. Disputes shall be finally settled by arbitration before a single arbitrator using the Commercial
Arbitration Rules of the American Arbitration Association ("AAA") as then in effect (the "Arbitration
Rules"); as modified by and subject to the provisions of this Section 10.06. The arbitration shall take place in
Atlanta, Georgia. Any court of competent jurisdiction shall have authority to enter its order enforcing the award of the
arbitrator (the "Underlying Award"), which shall be final and binding on the Disputing Parties, subject to the
following sentence. Notwithstanding anything to the contrary in this Section 10.06, the parties hereto agree: that the
Underlying Award may be appealed pursuant to the AAA's Optional Appellate Arbitration Rules (the "Appellate
Rules"); that the Underlying Award rendered by the arbitrator shall, at a minimum, be a reasoned award; and that the
Underlying Award shall not be considered final until after the time for filing the notice of appeal pursuant to the
Appellate Rules has expired. Any such appeal must be initiated within thirty (30) days of receipt of an Underlying Award, by
filing a notice of appeal pursuant to the Appellate Rules with any AAA office. Following the appeal process, the decision
rendered by the appeal tribunal may be entered in any court having jurisdiction thereof.

 

On receipt of a notice of a
Dispute, the parties hereto (each, a Disputing Party") shall initially participate in a mandatory mediation period. In
the event that such mediation does not resolve the Dispute within ten (10) days (or any mutually agreed extension
thereof.), the arbitration process shall be commenced by the initiating Disputing Party giving written notice to
the other Disputing Party of its intention to arbitrate (a "Demand"). The Dispute shall be decided by one
arbitrator designated by the Disputing Parties as follows. If the Disputing Parties are able to agree upon such arbitrator
within twenty- one (21) days after the Demand has been received by one Disputing Party from the initiating Disputing Party,
the Dispute shall be submitted to such arbitrator. If the Disputing Parties are unable so to agree upon such arbitrator
within such period for any reason, AAA is authorized hereby to select an arbitrator within ten (10) days after the expiration
of such twenty-one (21)-day period, which selection shall be made in accordance with the Arbitration Rules. The
administrative fee of AAA and the compensation and all other costs and expenses of the arbitrator shall be paid by the
Disputing Party that is not the substantially prevailing Disputing Party in the Dispute and the substantially
prevailing Disputing Party in the Dispute shall be entitled to recover from the other Disputing Party (and the arbitrator may
so award the substantially prevailing Disputing Party) any or all fees, costs, and expenses incurred by the substantially
prevailing Disputing Party in connection with the Dispute, including reasonable attorneys' fees.

 

	 	10.7	No Waiver, No Amendment.

 

No waiver shall be effective against any
party hereto unless signed by the party against whom the waiver is asserted. No amendment to this Agreement or shall be effective
unless signed by all parties to this Agreement. No waiver by any party hereto shall operate or be construed as a waiver in respect
of any failure, breach, or default not expressly identified by such written waiver,-whether of a similar or different
character, and whether occurring before or after that waiver. No failure to exercise, or delay in exercising, any right, remedy,
power, or privilege arising from this Agreement shall operate or be construed as a waiver thereof; nor shall any single or partial
exercise of any right, remedy, power, or privilege hereunder preclude any other or further exercise thereof or the exercise of
any other right, remedy, power, or privilege.

 

	 	10.8	Time is of the Essence.

 

Time is of the essence in the performance of this Agreement.

 

 

 

    	 	8	 

     

    

 

	 	10.9	Entire Agreement.

 

This Agreement is the entire agreement
between the parties hereto as to the matters addressed herein.

 

	 	10.10	Successors and Assigns.

 

This Agreement is personal to Godfrey and
shall not be assigned by Godfrey. Any purported assignment by Godfrey shall be null and void from the initial date of the purported
assignment. The Employer may assign this Agreement to any successor or Assign (whether direct or indirect, by purchase, merger,
consolidation, or otherwise) to all or substantially all of the business or assets of the Employer. This Agreement shall inure
to the benefit of the Employer and permitted successors and assigns.

 

	 	10.11	Survival.

 

Upon the expiration or other termination
of this Agreement, the respective rights and obligations of the parties hereto shall survive such expiration or other termination
to the extent necessary to carry out the intentions of the parties under this Agreement.

 

[Signature page follows.]

 

 

 

 

    	 	9	 

     

    

 

 

 

Witness our hands and seals as first above written.

 

	Employer:	Godfrey:
	 	 
	Marquis Industries, Inc.	 
	 	 
	 	 
	By: /s/ Timothy A. Bailey	/s/ Weston A. Godfrey Jr.
	Name: Timothy A. Bailey	Weston A Godfrey Jr.
	Title: Chief Executive Officer	 
	 	 

 

 

 

 

 

    	 	10

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