Document:

Execution
Copy

 

Equity
Interest Purchase Agreement

 

by
and among

 

Zen
Energy, Inc.,

 

Luccirelli
& Gomez, LLC,

 

TCN
Holdings, LLC,

 

Genaro
Gomez Castanares,

 

and

 

Donnie
Goodwin

 

dated
as of

 

January
20, 2017

 

    	 

    	 

    

 

Execution
Copy

 

Equity
Interest Purchase Agreement

 

This
Equity Interest Purchase Agreement (this “Agreement”) is made
and entered into as of January 20, 2017, by and among (i) Zen Energy, Inc., a Texas corporation (the “Purchaser”),
(ii) Luccirelli & Gomez, LLC (“L&G”), (iii) TCN Holdings, LLC (“TCN” and, together
with L&G, collectively, the “Sellers” or individually, a “Seller”), (iv) Genaro Gomez
Castanares (“Castanares”), and (v) Donnie Goodwin (“Goodwin” and, together with Castanares,
collectively, the “Principals” or individually, a “Principal”). Each of the Purchaser, the
Sellers and the Principals are referred to herein as a “Party” and collectively as the “Parties.”

Recitals

 

WHEREAS,
Enertrade Electric, LLC, a Texas limited liability company doing business as Shyne Energy (the “Company”) is
a retail electric provider engaged in the business of providing retail electricity and electric services to residential and commercial
consumers within the State of Texas (the “Business”);

 

WHEREAS,
the Sellers own all of the issued and outstanding membership interests (the “Outstanding Equity Interests”)
in the Company;

 

WHEREAS,
the Sellers desire to sell to the Purchaser, and the Purchaser desires to purchase from the Sellers, an aggregate of eighty-eight
percent (88%) of the Outstanding Equity Interests (the “Purchased Equity Interests”), on the terms and subject
to the conditions set forth herein;

 

NOW,
THEREFORE, in consideration of the foregoing and the representations, warranties, covenants and agreements set forth in this Agreement,
the Parties agree as follows:

 

Article
I

Sale
of Purchased Equity Interests and Related Transactions

 

1.1
Certain Definitions. For purposes of this Agreement, capitalized terms have the meanings set forth on Exhibit A
attached hereto.

 

1.2
Sale and Purchase of Equity Interests. Upon the terms and subject to the conditions of this Agreement, at the Closing,
(a) Sellers agree to sell to the Purchaser and the Purchaser agrees to purchase from the Sellers, all of the Purchased Equity
Interests free and clear of all Liens, claims, demands and restrictions on transfer.

 

1.3
GSE Subscription for New Equity Interests.

 

(a)
At the Closing, and as a condition to the consummation of the transactions contemplated by this Agreement, Purchaser and Sellers
acknowledge and agree that Gulf States Energy, Inc., a Texas corporation (“GSE”) shall subscribe for and acquire
new membership interests in the Company (the “New Equity Interests”), which New Equity Interests shall represent
ten percent (10%) of the total issued and outstanding membership interests in the Company, shall dilute the Purchased Equity Interests
to eighty percent (80%) of the total issued and outstanding membership interests in the Company, and shall dilute the Outstanding
Equity Interests retained by the Sellers to an aggregate of ten percent (10%) of the total issued and outstanding membership interests
in the Company, all upon the simultaneous consummation of both GSE’s acquisition of the New Equity Interests and the transactions
contemplated by this Agreement.

 

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(b)
Purchaser and Sellers acknowledge and agree that GSE’s subscription for and acquisition of the New Equity Interests shall
be pursuant to the terms and conditions of a subscription agreement (the “GSE Subscription Agreement”) in a
form to be mutually agreed upon and to be entered into between GSE and the Company and delivered at and as a condition to Closing.
Purchaser and Sellers further acknowledge and agree that the consideration from GSE to the Company for the New Equity Interests
shall be the services to be provided by GSE to the Company following Closing pursuant to the terms and conditions of a services
agreement (the “GSE Services Agreement”) in a form to be mutually agreed upon and to be entered into between
GSE and the Company and delivered at and as a condition to Closing pursuant to which GSE shall provide certain marketing and development
services for and on behalf of the Company, including, without limitation, (i) the transfer to the Company of GSE’s existing
book of business with DTE Energy, and (ii) GSE’s agreement to further market and develop the Company’s retail commercial
customer business, and pursuant to which the Company shall purchase electricity supply to service such DTE Energy and additional
commercial customer business from GSE pursuant to the credit sleeve financing terms and conditions of that one certain Energy
Marketing Support Agreement dated April 15, 2016 (the “Luminant Contract”), between the Company and Luminant
Energy Company, LLC (“Luminant”).

 

1.4
Mexico Opportunities. At Closing, and as partial consideration for the Sellers’ retention of the Outstanding Membership
Interests to be retained by the Sellers following Closing and as a condition to the consummation of the transactions contemplated
by this Agreement, the Sellers or the Principals, as applicable, shall enter into a services agreement (the “Sellers
Services Agreement”) in a form to be mutually agreed upon and to be entered into between the Sellers and the Company
and delivered at and as a condition to Closing pursuant to which the Sellers shall present to the Company all opportunities to
provide retail electricity and electric services to residential and commercial consumers within the Republic of Mexico as and
when such opportunities arise and pursuant to which the Company shall agree to purchase electricity supply to service such Republic
of Mexico business opportunities accepted by the Company pursuant to the credit sleeve financing terms and conditions of the Luminant
Contract.

 

1.5
Company Agreement. At Closing, and as a condition to the consummation of the transactions contemplated by this Agreement,
Purchaser, Sellers and GSE shall enter into and deliver an Amended and Restated Company Agreement (the “Amended Company
Agreement”) for the Company in a form to be mutually agreed upon and to be entered into among Purchaser, Sellers and
GSE.

 

Article
II

The
Closing

 

2.1
Closing. The consummation of the transactions contemplated by this Agreement (the “Closing”) will take
place at the offices of Pulman, Cappuccio, Pullen, Benson & Jones, LLP, 2161 N.W. Military Hwy., Suite 400, San Antonio, Texas
78213, on the third Business Day following the satisfaction or waiver of the conditions set forth in Article VIII, or at
such other time, date and location or by electronic/virtual closing, as Purchaser and the Sellers shall agree in writing (the
date on which such Closing takes place, the “Closing Date”); provided, however, that the Closing shall occur
within sixty (60) days from the date of this Agreement unless such sixty (60) day period is extended by the written agreement
of the Purchaser and the Sellers.

 

2.2
Intentionally Omitted.

 

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2.3
Consideration. In consideration of the sale and transfer of the Purchased Equity Interests to Purchaser and the consummation
of the other transactions contemplated by this Agreement, Purchaser shall pay or cause to be paid to Sellers an aggregate consideration
amount (such amount, as finally determined, the “Closing Purchase Price”) of One Million Five Hundred Thousand
and no/100 Dollars ($1,500,000.00) (the “Base Purchase Price”), increased or decreased, as the case may be,
by (x) the Working Capital Adjustment Amount in accordance with Section 2.4(b)(i)(A), (y) the Closing Indebtedness Adjustment
Amount in accordance with Section 2.4(b)(i)(B), and (z) the unpaid Company Transaction Costs Adjustment Amount in accordance
with Section 2.4(b)(i)(C). At Closing, Purchaser shall pay the Estimated Closing Purchase Price to the Sellers as follows:

 

(a)
Payments at Closing. At Closing, Purchaser shall deliver or cause to be delivered the following:

 

(i)
to the Sellers, by wire transfer of immediately available funds, to an account designated in writing by the Sellers to Purchaser
no later than two (2) Business Days prior to the Closing Date, an aggregate amount equal to Five Hundred Thousand and no/100 Dollars
($500,000.00), increased or decreased, as the case may be, by the adjustments to the Base Purchase Price set forth in Section
2.4(a)(i), (ii), and (iii) (collectively, the “Estimated Adjustments”); provided, however, if the Estimated
Adjustments exceed Five Hundred Thousand and no/100 Dollars ($500,000.00), then the amount of such excess shall reduce the principal
balance of the Seller Note; and

 

(ii)
to any third parties owed Estimated Closing Indebtedness or Company Transaction Costs, the amount of such Estimated Closing Indebtedness
and the amount of the Company Transaction Costs.

 

(b)
Delivery of Seller Note at Closing. At and as a condition to the Closing, Purchaser also will execute and deliver a note
(the “Seller Note”) in a form to be mutually agreed upon by Purchaser and Seller, which Seller Note shall be
in favor of Sellers for the amount of One Million and no/100 Dollars ($1,000,000.00) minus, if applicable, the amount by
which the Estimated Adjustments exceed Five Hundred Thousand and no/100 Dollars ($500,000.00) (the “Seller Note Amount”),
which Seller Note shall provide for the payment of the Seller Note Amount, without interest, in two (2) equal installments, with
the first due and payable by Purchaser to the Sellers on that date which is ninety (90) days following the Closing Date and the
second due and payable by the Purchaser to the Seller on that date which is one hundred and eighty (180) days following the Closing
Date.

 

(c)
Payments Following the Closing. Following the Closing, the difference, if any, between the Estimated Closing Purchase Price
and the Closing Purchase Price, as finally determined pursuant to Section 2.4, shall be delivered as set forth in Section
2.4(c).

 

2.4
Adjustment Amounts.

 

(a)
Estimated Adjustment Documents. No later than three (3) Business Days prior to the Closing Date, the Sellers shall in good
faith cause to be prepared and shall provide to Purchaser for Purchaser’s review and evaluation (i) an estimated balance
sheet of the Company as of the Closing Date (as finally agreed upon, the “Estimated Closing Date Balance Sheet”),
(ii) a schedule setting forth the estimated Current Assets and estimated Current Liabilities of the Company as of the Closing
Date and setting forth the Company’s proposed calculation of the Estimated Working Capital as of the Closing Date (as finally
agreed upon, the “Estimated Working Capital Schedule”), (iii) a schedule setting forth the Company’s
proposed calculation of the Estimated Closing Indebtedness (as finally agreed upon, the “Estimated Indebtedness Schedule”),
(iv) a schedule setting forth the Company’s proposed calculation of the Estimated Company Transaction Costs (as finally
agreed upon, the “Estimated Company Transaction Costs Schedule”), and (v) a statement of the calculation of
the Estimated Closing Purchase Price and Estimated Adjustment Amounts, based on the Estimated Closing Date Balance Sheet, the
Estimated Working Capital Schedule, the Estimated Indebtedness Schedule, the Estimated Company Transaction Costs Schedule (collectively,
the above (i)-(v) are the “Estimated Adjustment Documents”). The Estimated Adjustment Documents shall be finalized
by mutual agreement of Sellers and Purchaser no later than the Closing Date and shall be prepared in accordance with GAAP, consistently
applied. For purposes hereof, the “Estimated Closing Purchase Price” shall mean the Base Purchase Price adjusted,
as applicable, by the following (collectively, the “Estimated Adjustment Amounts”):

 

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(i)
decreased, on a dollar-for-dollar basis, by the amount, if any, that the Estimated Working Capital as of the Closing Date is less
than the Target Working Capital or increased, on a dollar-for-dollar basis, by the amount, if any, that the Estimated Working
Capital as of the Closing Date is greater than the Target Working Capital, as the case may be (the “Estimated Working
Capital Adjustment Amount”); and

 

(ii)
decreased, on a dollar-for-dollar basis, by the amount of the Estimated Closing Indebtedness (the “Estimated Closing
Indebtedness Adjustment Amount”).

 

(b)
Post-Closing Adjustment Amount.

 

(i)
In order to determine the actual Working Capital, the actual Closing Indebtedness and the actual Company Transaction Costs on
the Closing Date, and any corresponding adjustment to the Closing Purchase Price, Purchaser shall prepare (i) a balance sheet
of the Company as of the Closing Date (as finally determined, the “Closing Date Balance Sheet”), (ii) a schedule
of the Current Assets and Current Liabilities of the Company as of the Closing Date setting forth a calculation of the Working
Capital as of the Closing Date (the “Final Working Capital” as reflected on the “Working Capital Schedule”),
(iii) a schedule setting forth the Closing Indebtedness (the “Final Closing Indebtedness” as reflected on the
“Indebtedness Schedule”), and (iv) a schedule of the Company Transaction Costs (the “Final Company
Transaction Costs” as reflected on the “Company Transaction Costs Schedule”). On the basis of the
Closing Date Balance Sheet, the Working Capital Schedule, the Indebtedness Schedule, and the Company Transaction Costs Schedule
subject, however, to the rights of Purchaser and the Sellers as provided in Sections 2.4(d) and 2.4(e) below, and
for purposes of calculating the Closing Purchase Price, the Base Purchase Price shall be:

 

(A)
decreased, on a dollar-for-dollar basis, by the amount, if any, that the Final Working Capital on the Closing Date is less than
the Target Working Capital or increased, on a dollar-for-dollar basis, by the amount, if any, that the Final Working Capital on
the Closing Date is greater than the Target Working Capital (the “Working Capital Adjustment Amount”);

 

(B)
decreased, on a dollar-for-dollar basis, by the amount of the Final Closing Indebtedness (the “Closing Indebtedness Adjustment
Amount”); and

 

(C)
decreased, on a dollar-for-dollar basis, by the amount of the Final Company Transaction Costs (the “Closing Transaction
Costs Adjustment Amount” and, together with the Working Capital Adjustment Amount and the Closing Indebtedness Adjustment
Amount, the “Adjustment Amounts”).

 

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(c)
Payment of Adjustment Amount. If the Closing Purchase Price exceeds the Estimated Closing Purchase Price, then,
within five (5) Business Days of the final determination of the Final Adjustment Amounts in accordance with this Section 2.4(c),
the amount by which Closing Purchase Price exceeds the Estimated Closing Purchase Price shall be added to the principal due and
owing pursuant to the Seller Note as of such date. If the Closing Purchase Price is less than the Estimated Closing Purchase
Price, then, within five (5) Business Days of the final determination of the Final Adjustment Amounts in accordance with this
Section 2.4(c), the amount by which the Closing Purchase Price is less than the Estimated Closing Purchase Price shall
be subtracted from the principal due and owing pursuant to the Seller Note as of such date.

 

(d)
Delivery of Adjustment Documents; Disputes. Purchaser shall, within thirty (30) days following the Closing Date, deliver
to the Sellers (i) the Closing Date Balance Sheet, (ii) the Working Capital Schedule, (iii) the Indebtedness Schedule, (iv) the
Company Transaction Costs Schedule, and (v) a statement of the calculation of the Final Adjustment Amounts, based on the Closing
Balance Sheet, the Working Capital Schedule, the Indebtedness Schedule, and the Company Transaction Cost Schedule and (vi) a statement
of the resulting Closing Purchase Price (collectively, the above (i)-(iv) are the “Adjustment Documents”).
The Adjustment Documents shall be final and binding on, and deemed accepted by, the Parties, unless within thirty (30) days after
the Sellers’ receipt thereof, the Sellers provide Purchaser with written notice of objection with respect to the Adjustment
Documents (an “Objection Notice”). The Objection Notice shall specify in reasonable detail each item on the
Adjustment Documents that the Sellers dispute, the nature of any objection so asserted, and any portions of the Adjustment Documents
the Sellers do not dispute. Purchaser agrees that during the entirety of such thirty (30) day period following the Sellers’
receipt of the Adjustment Documents, the Sellers and its representatives shall have, for the purposes of evaluating the Adjustment
Documents, reasonable access to the appropriate books, records, schedules, analyses, working papers and other information used
in the preparation of the Adjustment Documents.

 

(e)
Resolution of Disputes. During the thirty (30) day period following the date on which the Objection Notice is received
by Purchaser, Purchaser and Sellers shall meet in an effort to resolve any objections contained therein. If Purchaser and Sellers
are unable to resolve the dispute within such thirty (30) day period, then any disputed matter set forth in the Objection Notice
which remains unresolved shall be submitted for final determination to an independent accounting firm with no current relationship
with any Party agreed upon in writing by the Purchaser and Sellers (such firm, the “Independent Accounting Firm”).
The Independent Accounting Firm shall, based solely on the documents and presentations made by Purchaser and Sellers and within
thirty (30) days after its receipt of any such disputed matter, render a written report as to the resolution of each disputed
matter set forth in the Objection Notice which remains outstanding, and as to the calculation of the Final Adjustment Amounts
and the final Closing Purchase Price. The Independent Accounting Firm shall have exclusive jurisdiction over, and resort to the
Independent Accounting Firm shall be the sole recourse and remedy of the Parties against one another or any other Person with
respect to, any disputes arising out of or relating to the Closing Date Balance Sheet, the Working Capital Schedule, the Indebtedness
Schedule, the Company Transaction Cost Schedule, the Final Adjustment Amounts and the Closing Purchase Price. The Independent
Accounting Firm’s determination shall be conclusive and binding on all parties and shall be enforceable in a court of law.
The Parties agree that all adjustments shall be made without regard to materiality. The Independent Accounting Firm shall only
decide the specific items under dispute by the Parties and their decision for each disputed amount must be within the range of
values assigned to each such item in the Working Capital Schedule and the Objection Notice, respectively. The fees and expenses
of the Independent Accounting Firm shall be paid by the Sellers, on the one hand, and Purchaser, on the other hand, based upon
the percentage that the amount actually contested but not awarded to the Sellers or Purchaser, respectively, bears to the aggregate
amount actually contested by the Sellers and Purchaser.

 

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(f)
Final Closing Purchase Price. The Final Adjustment Amounts and Closing Purchase Price shall become final and binding
upon the parties upon the earlier of (i) the failure by Sellers to object thereto within the period permitted under, and otherwise
in accordance with, the requirements of Section 2.4(d), (ii) the written agreement between Sellers and Purchaser with respect
thereto, or (iii) the decision by the Independent Accounting Firm with respect to disputes under Section 2.4(e).

 

2.5
Taking of Necessary Action; Further Action. If, at any time after the Closing Date, any further action is necessary or
desirable to carry out the purposes of this Agreement and to vest Purchaser with full right, title and possession to all assets,
property, rights, privileges, powers and franchises of the Company, the Sellers and Purchaser will take all such lawful and necessary
action.

 

2.6
Seller Disclosure Schedule. Within ten (10) Business Days from the date of this Agreement, but in no event later than ten
(10) Business Days prior to the Closing Date, Sellers shall prepare and shall provide to Purchaser for Purchaser’s review
and evaluation the Seller Disclosure Schedule, as defined below. Subject to Section 10.1(e) below, the Seller Disclosure
Schedule shall be finalized by mutual agreement of Sellers and Purchaser no later than the Closing Date.

 

2.7
Closing Deliverables.

 

(a)
At the Closing, the Sellers shall deliver or cause to be delivered to Purchaser the following:

 

(i)
The Sellers Services Agreement, executed by the Sellers;

 

(ii)
The Amended Company Agreement, executed by the Sellers;

 

(iii)
a membership interest assignment (the “Membership Interest Assignment”), in a form to be mutually agreed upon
by Purchaser and Sellers, executed by the applicable Sellers sufficient to transfer the Purchased Equity Interests to the Purchaser;

 

(iv)
the certificates required to be delivered pursuant to Sections 8.2(a) and 8.2(b) (the “Company Closing
Certificates”);

 

(v)
the Payoff Letters;

 

(vi)
a UCC search from the Secretary of State of Texas and each county therein in which (A) the Sellers reside or (ii) the Company
has offices evidencing any Encumbrances on the assets of the Company, the Purchased Equity Interests and evidence of release of
any such Encumbrances relating to the assets of the Company and the Purchased Equity Interests dated not more than five (5) days
prior to the Closing Date and in such form acceptable to Purchaser in its sole discretion;

 

(vii)
certificates as to good standing (or equivalent certificates) of the Company certified as of a date not more than 5 days prior
to the Closing Date by the appropriate authority in the respective jurisdiction in which the Company is qualified to do business;

 

(viii)
a certificate of the Secretary or Assistant Secretary (or equivalent officer) of the Company (the “Company Secretary
Certificate”) certifying (A) that attached thereto are true and complete copies of the Organizational Documents of the
Company as of immediately prior to Closing, (B) that attached thereto are true and complete copies of all resolutions adopted
by the governing authority of the Company authorizing the execution, delivery and performance of the Transaction Documents to
which the Company is a party and the consummation of the transactions contemplated thereby, and that all such resolutions are
in full force and effect and are all the resolutions adopted in connection with the transactions contemplated hereby and thereby,
and (C) that attached thereto are true and complete copies of all resolutions adopted by the equity holders of the Company consenting
to and approving the Transaction Documents to which the Company is a party and the consummation of the transactions contemplated
hereby and thereby, and that all such resolutions are in full force and effect and are all the resolutions adopted in connection
with the transactions contemplated hereby and thereby;

 

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(ix)
the Closing Company Transaction Costs Certificate duly executed by the Sellers;

 

(x)
the Closing Company Indebtedness Certificate duly executed by the Sellers;

 

(xi)
the resignation of the officers and managers of the Company, except as otherwise consented to by Purchaser, effective as of the
Closing, in forms reasonably acceptable to Purchaser;

 

(xii)
any original minute books of the Company, including any ownership ledgers;

 

(xiii)
the finalized Seller Disclosure Schedule in a form agreed upon by Sellers and Purchaser; and

 

(xiv)
such other, instruments of transfer, endorsements, releases and documents as Purchaser reasonably request and are reasonably necessary
to consummate the transactions contemplated hereby.

 

(b)
At the Closing, Purchaser shall deliver or cause to be delivered to Sellers (or to such other third party as set forth below)
the following:

 

(i)
the Estimated Closing Purchase Price (to be paid to the Sellers and other third parties as contemplated in Section 2.3(a));

 

(ii)
the Seller Note executed by Purchaser;

 

(iii)
the Sellers Services Agreement executed by the Company;

 

(iv)
the Amended Company Agreement executed by Purchaser;

 

(v)
the certificates required to be delivered pursuant to Sections 8.1(a) and 8.1(b) (the “Purchaser Closing
Certificates”);

 

(vi)
a certificate of the Secretary or an Assistant Secretary (or equivalent officer) of the Purchaser certifying that attached thereto
are true and complete copies of all resolutions adopted by the governing authority of the Purchaser authorizing the execution,
delivery and performance of this Agreement and the other Transaction Documents and the consummation of the transactions contemplated
hereby and thereby, and that all such resolutions are in full force and effect and are all the resolutions adopted in connection
with the transactions contemplated hereby and thereby.

 

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(c)
At the Closing, the Parties shall take all steps necessary to cause the GSE Subscription Agreement and the GSE Services Agreement
to be executed and delivered by GSE and the Company and to cause GSE to deliver the Amended Company Agreement executed by GSE.

 

(d)
At the Closing, the Sellers shall take all steps necessary to vest in Purchaser all the rights, privileges and powers of the Purchased
Equity Interests and all Parties shall take all steps necessary to consummate the transactions contemplated hereby.

 

Article
III

Representations
and Warranties of the Sellers

 

Except
as set forth in the correspondingly numbered Section of the disclosure schedule delivered pursuant to Section 2.6 above
that relates to such Section or in another Section of the Seller Disclosure Schedule to the extent that it is reasonably apparent
on the face of such disclosure that such disclosure is applicable to such Section (the “Seller Disclosure Schedule”)
and describing in reasonable specificity the basis for such exception, the Sellers and the Principals, jointly and severally,
represent and warrant to Purchaser that the statements contained in this Article III are true and correct as of the date
hereof and as of the Closing Date.

 

3.1
Organization. As of the date hereof, the Company is a limited liability company, duly organized and validly existing and
in good standing under the laws of the State of Texas. The Company has all requisite company power and authority to carry on its
business as now being conducted, to own, use and lease the properties and assets it now owns and to perform all of its obligations
under each agreement to which it is a party or by which it is bound and is duly qualified or licensed to do business as a foreign
entity in good standing in every jurisdiction in which such qualification is required, except where the failure to be so licensed,
qualified or in good standing would not, individually or in the aggregate, have a Company Material Adverse Effect. The Company
does not own any Subsidiary and does not own, or have any ownership interest in, any other Person. The Company is not in violation
of any of the provisions contained in its Organizational Documents. The Company engages in no operations or activities other than
the Business.

 

3.2
Authorization, Execution and Validity.

 

(a)
The Company has full limited liability company power and authority to execute and deliver each of the Transaction Documents to
which it is a party and to consummate the transactions contemplated thereby. The execution and delivery by the Company of the
Transaction Documents to which it is a party, the performance by the Company of its obligations thereunder and the consummation
by the Company of the transactions contemplated thereby have been duly authorized by all necessary limited liability company action
on the part of the Company. The Transaction Documents to which it is a party have been duly executed and delivered by the Company.
Assuming the due and valid authorization, execution and delivery hereof by Purchaser, the Transaction Documents to which it is
a party when executed and delivered by the Company, will be valid and binding obligations of the Company enforceable against the
Company in accordance with their terms, except as limited by applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent
conveyance and other similar laws of general application affecting enforcement of creditors’ rights generally (collectively,
the “Enforceability Limitations”).

 

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(b)
Each Seller has full legal right, power and authority to execute and deliver this Agreement and each of the Transaction Documents
to which it is a party and to consummate the transactions contemplated hereby and thereby. The execution and delivery by each
Seller of this Agreement and any other Transaction Document to which such Seller is a party, the performance by such Seller of
its obligations hereunder and thereunder and the consummation by such Seller of the transactions contemplated hereby and thereby
have been duly authorized by all requisite action on the part of such Seller. This Agreement has been duly executed and delivered
by each Seller, and (assuming due authorization, execution and delivery by Purchaser) this Agreement constitutes a legal, valid
and binding obligation of each Seller enforceable against such Seller in accordance with its terms. When each other Transaction
Document to which each Seller is or will be a party has been duly executed and delivered by such Seller (assuming due authorization,
execution and delivery by each other party thereto), such Transaction Document will constitute a legal and binding obligation
of such Seller enforceable against him in accordance with its terms.

 

3.3
Consents and Approvals; No Violations.

 

(a)
Except as set forth in Section 3.3(a) of the Seller Disclosure Schedule, the execution and delivery by the Company of this
Agreement or any of the Transaction Documents to which it is a party, the performance by Company of its obligations hereunder
or thereunder, the consummation by the Company of the transactions contemplated hereby or thereby, will not (i) conflict with
or result in any breach of any provision of any Organizational Document of the Company, respectively, (ii) conflict with or result
in a violation or breach of any Legal Requirement or Order applicable to the Company, (iii) require any declaration or filing
with, or permit, authorization, consent or approval of, any Governmental Authority, (iv) result in the creation or imposition
of any Encumbrance other than Permitted Encumbrances on any properties or assets of the Company, or (v) result in any violation
or breach of, constitute a default under, result in the acceleration of or create in any party the right to accelerate, terminate,
modify or cancel (in each case, with or without notice or the lapse of time or both) any Company Permit or Contract, including,
without limitation, the Luminant Contract, to which the Company is a party or by which the Company or the Business is bound, except
where such conflict, violation, breach, default, acceleration, termination, modification, cancellation, failure to give notice
or Encumbrance would not, individually or in the aggregate, have a Company Material Adverse Effect.

 

(b)
Except as set forth in Section 3.3(b) of the Seller Disclosure Schedule, the execution, delivery and performance by each
Seller of this Agreement and the other Transaction Documents to which such Seller is a party, and the consummation of the transactions
contemplated hereby and thereby, do not and will not: (i) conflict with or result in a violation or breach of any Legal Requirement
or Order applicable to such Seller; (ii) require any declaration or filing with, or permit, authorization, consent or approval
of, any Governmental Authority, (iii) result in the creation or imposition of any Encumbrance other than Permitted Encumbrances
on the Purchased Equity Interests or on any properties or assets of the Company, (iv) result in any violation or breach of, constitute
a default under, result in the acceleration of or create in any party the right to accelerate, terminate, modify or cancel (in
each case, with or without notice or the lapse of time or both) any Company Permit or Contract, including, without limitation,
the Luminant Contract, to which the Company is a party or by which the Company or the Business is bound or (v) create in any party
a right of payment from the Company, any Seller, any Purchaser or any of their respective Affiliates following the Closing, including
without limitation any return of grant monies or assets to any Governmental Authority.

 

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3.4
Capitalization.

 

(a)
Section 3.4(a) of the Seller Disclosure Schedule sets forth the following information with respect to the Company: (A)
issued and outstanding Outstanding Equity Interests and (B) the name of the holder of each of the issued and outstanding Outstanding
Equity Interests and the number or percentage held by such Person. Except as set forth in Section 3.4(a) of the Seller
Disclosure Schedule, (i) there are no equity-based compensation plans of the Company, (ii) there is no restricted interest, stock,
option, subscription, warrant, option, convertible or exchangeable security, or other right (contingent or otherwise) to purchase
or otherwise acquire equity securities of the Company that is authorized or outstanding, and (iii) there is no commitment by the
Company to issue interests, shares, subscriptions, warrants, options, convertible or exchangeable securities, or other such rights
or to distribute to holders of any of its equity securities any evidence of Indebtedness or asset, to repurchase or redeem any
securities of the Company or to grant, extend, accelerate the vesting of, change the price of, or otherwise amend any warrant,
option, convertible or exchangeable security or other such right. There are no declared or accrued unpaid distributions with respect
to any of the Outstanding Equity Interests. All issued and outstanding Outstanding Equity Interests are (i) duly authorized, validly
issued, fully paid and non-assessable; (ii) not subject to any preemptive rights created by statute, the Company’s Organizational
Documents or any agreement to which the Company is a party; and (iii) free of any Encumbrances in respect thereof. All issued
and outstanding Outstanding Equity Interests were issued in compliance with applicable Legal Requirements.

 

(b)
There are no outstanding or authorized stock appreciation, dividend equivalent, phantom stock, profit participation or other similar
rights with respect to the Company or any of the Company’s securities.

 

(c)
All distributions, repurchases and redemptions of the equity interests of the Company were undertaken in compliance with the Company’s
Organizational Documents then in effect, any agreement to which the Company then was a party and in compliance with applicable
Legal Requirements.

 

3.5
Financial Statements.

 

(a)
Section 3.5 of the Seller Disclosure Schedule includes accurate and complete copies of (a) the unaudited balance sheet
and statements of income, equity and cash flows of the Company for the twelve (12) months ended December 31, 2016 and (b) the
audited balance sheets and statements of income, equity and cash flows of the Company for the fiscal years ended December 31,
2015 and 2014. Collectively, the financial statements referred to in the immediately preceding sentence are sometimes referred
to herein as the “Financial Statements,” the Company’s interim consolidated balance sheet as of December
31, 2016 is referred to herein as the “Balance Sheet” and December 31, 2016 is referred to herein as the “Balance
Sheet Date.” Except as set forth in Section 3.5 of the Seller Disclosure Schedule, each of the Financial Statements
(including any related notes) (i) was prepared from and in accordance with the Company’s Books and Records, (ii) fairly
presents the Company’s financial position, as of the respective dates thereof and for the respective periods covered thereby,
and fairly presents the Company’s results of operations, equity and cash flows, as the case may be, for the periods covered
thereby, in each case, in accordance with GAAP consistently applied, and (iii) contains and reflects all necessary adjustments,
accruals, provisions and allowances required by GAAP. The reserves, if any, established by the Company and set forth on the Financial
Statements, or the lack of a reserve thereon, if applicable, are based upon facts and circumstances known by the Company on the
respective dates as of which such Financial Statements were prepared.

 

    	10 

    	 

    

 

3.6
No Undisclosed Liabilities; Work In Progress.(a) The Company has no Liabilities, and there is no existing condition, situation
or set of circumstances of a type required to be reflected on a balance sheet prepared in accordance with GAAP, except for (i)
Liabilities and obligations which are adequately reflected or reserved against in the Balance Sheet as of the Balance Sheet Date,
and (ii) Liabilities and obligations incurred since the Balance Sheet Date in the ordinary course of business consistent with
past practice and which are not, individually or in the aggregate, material in amount. Except as set forth in the Financial Statements,
the Company has not, nor will the Company have as of or following the Closing, any obligation or Liability for earn-outs or other
contingent payments payable to former owners of assets, or equity interests of any kind acquired by the Company or otherwise arising
out of previous transactions by the Company.

 

(b)
Set forth on Section 3.6(b) of the Seller Disclosure Schedule is a complete and accurate description of each customer project
under which the Company is providing services for which it has received funds for services that have not been fully provided,
including for each such project (i) an estimate of the portion of the fee that has been earned to date, (ii) the costs expended
on such job to date and the estimated remaining costs to complete the project, (iii) the deferred revenue on such engagement and
(iv) a reasonable estimate of any losses that will arise from each such project (e.g., costs exceeding the revenue).

 

3.7
Absence of Certain Changes. Except as set forth in Section 3.7 of the Seller Disclosure Schedule, since December
31, 2015, the Company has not:

 

(a)
suffered a Company Material Adverse Effect;

 

(b)
amended, modified or repealed any provision of any of the Company’s Organizational Documents or consented to any such amendment,
modification or repeal;

 

(c)
other than in the ordinary course of business consistent with past practice or as set forth in the Financial Statements, created,
incurred, assumed, guaranteed, endorsed, refinanced, modified, extended, renewed or otherwise become liable for any Liabilities
(including any Indebtedness), or failed to pay or discharge when due any Liabilities, or paid, agreed to cancel or pay, or otherwise
provided for a complete or partial discharge in advance of a scheduled payment date with respect to any Indebtedness, obligation
or other Liability, or waived, cancelled or compromised any right to receive any direct or indirect payment or other benefit under
any debt, obligation or other Liability owing to the Company, or granted any extensions of credit;

 

(d)
made any material change in its accounting methods, principles or practices (except to the extent required by GAAP), changed or
adopted any new method of Tax accounting, made or changed any Tax election, amended any Tax Returns or filed any claim for Tax
refunds, entered into any closing agreement, proposed any Tax adjustments or assessments, settled any Tax claim, audit or assessment
or surrendered any right to claim a Tax refund, offset or other reduction in Tax liability;

 

(e)
revalued any of its assets, delayed or postponed the payment of any accounts payable or commissions or any other liability or
obligation except in the ordinary course of business consistent with past practice, agreed or negotiated with any party to extend
the payment date of any accounts payable or commissions or any other liability or obligation, accelerated the collection of (or
discounted) any accounts or notes receivable, or taken any actions or omitted to take any actions with the intent or the purpose
of increasing the Company’s Working Capital as of the Closing;

 

    	11 

    	 

    

 

(f)
issued or authorized any issuance of any other securities in respect of, in lieu of or in substitution of equity interests in
the Company; granted or modified any option, warrant or other right to purchase any equity interests of the Company; issued any
security convertible into such equity interest; granted any registration rights; authorized, issued, sold, transferred, pledged,
disposed of or encumbered any equity interest of the Company, or securities convertible into or exercisable or exchangeable for,
or options, warrants, calls, commitments or rights of any kind to acquire, any equity interest of the Company, or modified or
amended any right of any holder of any equity interest in the Company;

 

(g)
declared, paid or set aside for payment any distribution in respect of any equity interest of the Company or redeemed, purchased
or otherwise acquired, directly or indirectly, any equity interest of the Company;

 

(h)
sold, transferred or disposed of any assets having an aggregate value of more than $10,000, other than in the ordinary course
of business consistent with past practice;

 

(i)
sold, leased, exchanged, transferred, licensed (other than in the ordinary course of business consistent with past practice),
acquired, or disposed of, or subjected to any Encumbrance, the Company IP;

 

(j)
made any loans or advances to, or guarantees for the benefit of, any Person;

 

(k)
purchased any capital stock of or other equity interest in any Person;

 

(l)
acquired by merger or consolidation with, or by purchase of a substantial portion of the assets or stock of, or by any other manner,
any business or any Person or any division thereof;

 

(m)
entered into any new line of business or abandoned or discontinued any existing lines of business;

 

(n)
created or suffered the imposition of any Encumbrance upon any of its properties, capital stock or assets, tangible or intangible,
except for Permitted Encumbrances;

 

(o)
made any change in its cash management practices or its policies, practices or procedures with respect to collection of accounts
receivable, establishment of reserves for uncollectible accounts, accrual of accounts receivable, inventory control, prepayment
of expenses, payment of trade accounts payable, accrual of other expenses, deferral of revenue or acceptance of customer deposits;

 

(p)
entered into, amended, modified, affirmatively waived any right under, accelerated or terminated any Material Contract (including
any Contract that would constitute a Material Contract in the absence of such amendment, modification, waiver, acceleration or
termination);

 

(q)
made a commitment for capital expenditures in excess of $10,000 in the aggregate;

 

(r)
increased the compensation payable or to become payable (including benefits and bonuses, whether monetary or otherwise) to any
of the Company Employees (other than normal increases in base salaries in the ordinary course of business consistent with past
practice);

 

    	12 

    	 

    

 

(s)
adopted, amended, modified or terminated (or expressed any commitment or intention to adopt, amend, modify or terminate) any bonus,
profit sharing, incentive, severance, or other plan, Contract or commitment for the benefit of any of its directors, officers
or Company Employees (or taken any such action with respect to any other employee benefit plan), or increased the payments or
benefits under any such plan;

 

(t)
entered into or terminated any employment agreement or collective bargaining agreement, written or oral, or modified the terms
of any such existing agreement;

 

(u)
made any loan to, or entered into any other transaction with, any of its directors, officers or Company Employees;

 

(v)
adopted or become parties to any plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other
reorganization of the Company, filed any petition in bankruptcy under any provisions of federal or state bankruptcy law or consented
to the filing of any bankruptcy petition against it under any similar law;

 

(w)
paid or agreed to pay any bonuses or other compensation to any Person in connection with the transactions contemplated hereby
(including, without limitation, any severance, change in control or related bonuses or benefits);

 

(x)
suffered any loss, damage or destruction to its properties or assets, whether or not covered by insurance and whether or not in
the ordinary course of business, in an aggregate amount in excess of $10,000;

 

(y)
purchased, leased or otherwise acquired the right to own, use or lease any property or assets, or made any capital improvement,
for an amount in excess of $10,000, individually (in the case of a lease, per annum), or $10,000, in the aggregate (in the case
of a lease, for the entire term of the lease, not including any option term), except for purchases of inventory or supplies in
the ordinary course of business consistent with past practice;

 

(z)
entered into any material Contract other than in the ordinary course of business consistent with past practice, entered into any
other material transaction, whether or not in the ordinary course of business or consistent with past practice, or changed in
any significant respect any business practice (in anticipation of the transactions contemplated hereby or otherwise);

 

(aa)
except as expressly contemplated by this Agreement, applied for any governmental permit, license or authorization outside of the
ordinary course of business or the receipt of which would reasonably be likely to prevent or materially impair or delay the consummation
of the transactions contemplated hereby;

 

(bb)
settled any action, suit, charge, claim or proceeding, at law or in equity, pending or threatened to be brought before any Governmental
Authority for an amount to be paid by the Company in excess of $10,000, or which would be reasonably likely to have any material
adverse impact on the operations of the Company, taken as a whole, as a result of a non-monetary settlement; or

 

(cc)
entered into any agreement, contract or other binding commitment to do any of the foregoing or taken any action or made any omission
that would result in any of the foregoing.

 

    	13 

    	 

    

 

3.8
Title to Properties; Encumbrances. Except for properties and assets sold in the ordinary course of business consistent
with past practice, the Company has indefeasible title to, or a valid leasehold interest in, all properties and assets reflected
on the Balance Sheet or acquired after the Balance Sheet Date, including but not limited to all Real Property, in each case free
and clear of all Encumbrances other than Permitted Encumbrances.

 

3.9
Real Property; Leases.

 

(a)
The Company does not own any Real Property.

 

(b)
With respect to Real Property that is leased by the Company:

 

(i)
Each parcel of Real Property has direct access to a public street adjoining such Real Property or has access to a public street
via insurable easements benefiting such parcel of Real Property, and such access is not dependent on any land or other real property
interest that is not included in the Real Property. None of the Tangible Assets or any portion thereof included in the Real Property
is dependent for its access, use or operation on any land, building, improvement or other real property interest that is not included
in the Real Property.

 

(ii)
All water, gas, electrical, steam, telecommunications, sewer, storm and waste water systems and other utility services or systems
for the Real Property have been installed and are operational and sufficient for the operation of the Company’s business
as currently conducted thereon. No fact, condition, or proceeding exists which would result in the termination or material impairment
of the furnishing of services to the Real Property of the foregoing utility services.

 

(iii)
To the Knowledge of the Company, the use or occupancy of the Real Property after the Closing or any portion thereof and the operation
of the Company’s business as currently conducted is not dependent on a “permitted non-conforming use” or “permitted
non-conforming structure” or similar variance, exemption or approval from any Governmental Authority.

 

(iv)
To the Knowledge of the Company, the use and occupancy of the Real Property and the operation of the Company’s business
as currently and as proposed to be conducted thereon does not violate in any material respect any easement, covenant, condition,
restriction or similar provision in any instrument of record or other unrecorded agreement affecting such Real Property.

 

(v)
There are no Taxes with respect to any Real Property or portion thereof that are delinquent. There is no pending or, to the Knowledge
of the Company, threatened increase or special assessment or reassessment of any Taxes relating to the Real Property.

 

(vi)
To the Knowledge of the Company, no portion of the Real Property is located within an area of special risk with respect to earth
movement, flood, earth subsidence, rising water or other unusual natural hazards, nor does any Seller know of any adverse geological
or soil conditions affecting the Real Property.

 

(vii)
The use and operation of the Real Property in the conduct of the Company’s business do not violate any Legal Requirement,
covenant, condition, restriction, easement, license, permit or agreement. To the Knowledge of the Company, no improvements constituting
a part of the Real Property encroach on real property owned or leased by a Person other than the Company. There is no action,
suit, charge, claim or proceeding, at law or in equity, pending or, to the Knowledge of the Company, threatened against or affecting
the Real Property or any portion thereof or interest therein in the nature or in lieu of condemnation or eminent domain proceedings.

 

    	14 

    	 

    

 

3.10
Condition of Assets. The buildings, plants, structures, furniture, fixtures, machinery, equipment, vehicles and other items
of tangible personal property of the Company (collectively, the “Tangible Assets”) are structurally sound,
are in good operating condition and repair, and are adequate for the uses to which they are being put, and none of such Tangible
Assets are in need of maintenance or repairs except for ordinary, routine maintenance and repairs that are not material in nature
or cost.

 

3.11
Contracts and Commitments.

 

(a)
Contracts. Set forth in Section 3.11(a) of the Seller Disclosure Schedule is a list of all Contracts to which the
Company is a party or by which the Company or the Business is bound (each, a “Company Contract”).

 

(b)
The Sellers have made available to Purchaser a correct and complete copy of each Company Contract. Each Company Contract is in
full force and effect and the Luminant Contract is, and, to the Knowledge of the Company, the remaining Company Contracts are,
enforceable against the other party or parties thereto in accordance with its terms. The Company is not in breach of or default
under any Company Contract, nor has there occurred any event that with the passage of time or the giving of notice or both would
constitute a breach or default by the Company under a Company Contract or result in a termination thereof or would cause or permit
the acceleration or other change of any right or obligation or the loss of any benefit thereunder. Neither the Company nor Sellers
have received any notice that it is in breach of or default under, and has not provided or received any notice of any intention
to terminate, a Company Contract. No other party to the Luminant Contract is, and, to the Knowledge of the Company, no other party
to any other Company Contracts are, in breach of or default under a Company Contract, nor has there occurred any event that with
the passage of time or the giving of notice or both would constitute such a breach or default.

 

3.12
Litigation. Except as set forth on Section 3.12 of the Seller Disclosure Schedule, since January 1, 2012, there
has been (i) no action, suit, charge, claim or proceeding, at law or in equity, pending, or to the Knowledge of the Company, threatened
(A) against or by the Company affecting any of its properties or assets; or (B) against or by the Company that challenges or seeks
to prevent, enjoin or otherwise delay the transactions contemplated by this Agreement; (ii) no audit, examination or investigation
pending or threatened by any Governmental Authority against the Company or any of its properties or assets, or any of the directors
or officers of the Company in respect of their actions in such capacities; and (iii) no settlements or similar agreements that
imposes any ongoing obligation or restriction on the Company. There are no outstanding Orders and no unsatisfied judgments, penalties
or awards against or affecting the Company or any of its properties or assets.

 

3.13
Compliance with Laws; Permits.

 

(a)
Except as set forth in Section 3.13(a) of the Seller Disclosure Schedule, the Company has complied and is complying with and is
not in violation of, or under investigation with respect to, and has not received any written notice alleging any violation with
respect to, or otherwise been advised that it is not in compliance with, any provision of any and all Legal Requirements and Orders
that apply to the Company or the Business or the Company’s operations or assets. To the Knowledge of the Company, no circumstances
exist that are likely to result in violations of any of the foregoing or which could reasonably give rise to a claim (without
regard to the merits of such claim) that the Company or the conduct of its business is not in compliance with any Legal Requirement
or Order.

 

    	15 

    	 

    

 

(b)
Section 3.13(b) of the Seller Disclosure Schedule lists all material governmental permits, licenses or authorizations held
by the Company (the “Company Permits”), including their respective dates of issuance and expiration. All of
the Company Permits are valid and in full force and effect. The Company Permits constitute all governmental permits, licenses
and authorizations required to conduct the business of the Company as currently conducted. Neither the Company nor Sellers have
received any notice of any claim of any default or violation with respect to any the Company Permits, and all fees and charges
with respect to the Company Permits as of the date hereof have been paid in full. No event has occurred that, with or without
notice or lapse of time or both, would reasonably be expected to result in the revocation, suspension, lapse or limitation of
the Company Permit.

 

3.14
Employee Benefit Plans.

 

(a)
Section 3.14(a) of the Seller Disclosure Schedule sets forth a complete and accurate list of (A) all employee benefit plans
within the meaning of Section 3(3) of ERISA, whether or not tax-qualified and whether or not any such plans are exempt from the
provisions of ERISA, (B) all equity option plans, restricted equity, bonus or incentive award plans, employment and consulting
agreements, severance pay policies or agreements, parachute payment arrangements, deferred compensation agreements, fringe benefit
plans and (C) any employee benefit plan, agreement, program, practice, understanding or arrangement not described in clause (A)
or (B) above, in each case which is or has been maintained, sponsored, contributed to, or required to be contributed to by the
Company for the benefit of any current or former employee, officer, director, retiree, independent contractor or consultant of
a Company or any spouse or dependent of such individual, or under which the Company or any of its ERISA Affiliates has or may
have any Liability, contingent or otherwise (collectively “Plans”). The Company does not have any legally binding
commitment to amend, modify or terminate any Plan or to establish, adopt or enter into any arrangement that would be a Plan.

 

(b)
Except as set forth in Section 3.14(a) of the Seller Disclosure Schedule, all Plans materially comply with their terms
and with all applicable Legal Requirements, including ERISA and the Code and the regulations promulgated thereunder. The Company
has not engaged in any transaction with respect to the Plans which would subject the Company to a tax, penalty or Liability for
prohibited transactions under ERISA or the Code, or for any other reason. No litigation, claim, arbitration, Governmental Authority
proceeding, audit, or formal investigation (other than those relating to routine claims for benefits) is pending or, to the Knowledge
of the Company, threatened with respect to any Plan.

 

(c)
The Company has no obligation to provide health, life or disability benefits to any former Company Employee under any Plan, other
than coverage as may be required under Section 4980B of the Code or Part 6 of ERISA or similar statute.

 

(d)
Except as set forth in Section 3.14(d) of the Seller Disclosure Schedule, none of the execution and delivery by the Company
of this Agreement, the performance by the Company of its obligations hereunder or the consummation by the Company of the transactions
contemplated hereby will (i) entitle any Company Employee to severance pay or any increase in severance pay upon any termination
of employment after the date hereof, (ii) accelerate the time of payment or vesting or trigger any payment or funding (through
a grantor trust or otherwise) of compensation or benefits under, increase the amount payable or trigger any other obligation pursuant
to, any Plan, (iii) result in any breach or violation of, or a default under, any Plan, (iv) result in any forgiveness of indebtedness
owed by any Company Employee or officer of the Company, trigger any funding obligation under any Plan or impose any restrictions
or limitations on the Company’s rights to administer, amend or terminate any Plan, (v) result in any payment or the provision
of any other benefit, acceleration of vesting or payment of options that would be a “parachute payment” to a “disqualified
individual” as those terms are defined in Section 280G of the Code, without regard to whether such payment is reasonable
compensation for personal services performed or to be performed in the future, or (vi) result in the Company having an obligation
to make reimbursement or gross-up payments to any Person in respect to any Taxes, including without limitation Taxes incurred
under Sections 409A or 4999 of the Code.

 

    	16 

    	 

    

 

(e)
The Company has delivered or caused to be delivered to Purchaser and its counsel true and complete copies of (i) all plan documents
for the Plans as in effect for the Company, together with all amendments thereto which will become effective at a later date,
as well as the latest IRS determination letter, or opinion letter if the Plan is a prototype or volume submitter document, obtained
with respect to any such Plan qualified under Section 401 or 501 of the Code, (ii) Form 5500 for the three (3) most recent completed
fiscal years for each Plan required to file such form, (iii) a current summary plan description for each Plan, together with any
summary of material modifications thereto, if any, (iv) any insurance or annuity policy (including any fiduciary liability insurance
policy) related to any Plan, (v) the three (3) most recent summary annual reports provided to participants for each Plan required
to disclose such report and (vi) any material communication with any Governmental Authority regarding any Plan.

 

(f)
Except as set forth in Section 3.14(f) of the Seller Disclosure Schedule, there are no claims pending with respect to, or under,
any Plan other than routine claims for Plan benefits, and there are no disputes or litigation pending or, to the Knowledge of
the Company, threatened with respect to any such Plans; and all contributions, premiums, or other payments due from have been
fully paid or adequately provided for and disclosed on the Financial Statements.

 

(g)
Except as set forth in Section 3.14(g) of the Seller Disclosure Schedule, no action has been taken, nor has there been a failure
to take any action that would subject any person or entity to any Liability for any income, excise or other tax or penalty in
connection with any Plan other than for income taxes due with respect to benefits paid.

 

(h)
COBRA. The Company has complied with COBRA with respect to any Plan that is a group health plan subject to COBRA.

 

(i)
HIPAA. Every Plan of the Company that is a group health plan complies with the Health Insurance Portability and Accountability
Act of 1996, as amended, and the regulations thereunder.

 

3.15
Tax Matters.

 

(a)
Filed Returns and Tax Payments.

 

(i)
The Company has filed or caused to be filed on a timely basis all Tax Returns that were required to be filed by or with respect
to it, either separately or as a member of a group of corporations, pursuant to applicable Legal Requirements.

 

(ii)
The Company has not requested any waivers of statutes of limitations or extension of time within which to file any Tax Return.

 

    	17 

    	 

    

 

(iii)
All Tax Returns filed by (or that include on a consolidated basis) the Company are materially complete, true and correct and comply
with applicable Legal Requirements as of the time of such filing.

 

(iv)
The Company has paid, or made provision for the payment of, all Taxes that have become due for all periods covered by any Tax
Return or otherwise, except such Taxes, if any, that are listed in Section 3.15(a)(iv) of the Seller Disclosure Schedule
and that are being contested in good faith by appropriate Actions and for which adequate reserves have been provided in the Balance
Sheet.

 

(v)
The Company has duly and timely withheld or collected and fully paid to the proper Governmental Authority or other Person all
Taxes required to be withheld, collected or paid by it and complied with all information reporting and backup withholding requirements
pursuant to applicable Legal Requirements.

 

(vi)
Section 3.15(a)(vi) of the Seller Disclosure Schedule lists each income Tax Return and any other material Tax Return filed
by the Company since December 31, 2012, and the Company has delivered to Purchaser copies of all such Tax Returns.

 

(vii)
No claim has ever been made or is currently pending or, to the Knowledge of the Company, threatened, by any Governmental Authority
against the Company in a jurisdiction where the Company does not file a specific type of Tax Return that it is or could be subject
to such form of taxation by that jurisdiction, nor is there any reasonable basis for such a claim.

 

(viii)
No claim has ever been made or is currently pending or, to the Knowledge of the Company, threatened, by any Governmental Authority
in respect of any material Tax or Tax assessment, nor has any claim for an additional material Tax or Tax assessment been asserted
in writing or, to the Knowledge of the Company, proposed by any Tax authority, nor is there any reasonable basis for such a claim.

 

(b)
Audited or Closed Tax Years.

 

(i)
Section 3.15(b)(i) of the Seller Disclosure Schedule lists all audits of all Tax Returns, including a description of the
nature and, if completed, the outcome of each audit since December 31, 2010. The Company has delivered to Purchaser copies of
any reports, statements of deficiencies, or similar items with respect to such audits. Section 3.15(b)(i) of the Seller
Disclosure Schedule describes all adjustments to any Tax Return filed by or with respect to the Company for all taxable years
since December 31, 2010, and the resulting deficiencies proposed by the IRS or other Governmental Authority. Section 3.15(b)(i)
of the Seller Disclosure Schedule lists all deficiencies proposed as a result of such audits, all of which have been paid
or, as set forth in Section 3.15(b)(i) of the Seller Disclosure Schedule, have been settled or are being contested in good
faith by appropriate Actions.

 

(ii)
Except as set forth in Section 3.15(b)(ii) of the Seller Disclosure Schedule, no Actions are pending before the IRS or
other Governmental Authority with respect to the Taxes of the Company.

 

(iii)
Except as set forth in Section 3.15(b)(iii) of the Seller Disclosure Schedule, none of the Sellers or the Company has given
or been requested to give waivers or extensions (or is or would be subject to a waiver or extension given by any other Person)
of any statute of limitations relating to the payment of Taxes of the Company or for which a Company could be liable.

 

    	18 

    	 

    

 

(iv)
Except as set forth in Section 3.15(b)(iv) of the Seller Disclosure Schedule, no Encumbrance for Taxes exists with respect
to any assets of the Company, except statutory liens for Taxes not yet due.

 

(c)
Status of the Company.

 

(i)
The Company has not been a member of any affiliated group of corporations that has filed a combined, consolidated or unitary income
Tax Return with any Governmental Authority. The Company is not liable for the Taxes of any Person under Treasury Regulation Section
1.1502-6 or any similar provision of any applicable Legal Requirement, as a transferee or successor, by contract or otherwise.

 

(d)
Miscellaneous.

 

(i)
There is no tax sharing agreement, tax allocation agreement, tax indemnity obligation or similar agreement, arrangement, understanding
or practice, oral or written, with respect to Taxes that will require any payment by the Company.

 

(ii)
The Company has not received or applied for a Tax ruling or entered into a closing agreement pursuant to Section 7121 of the Code
(or any predecessor provision or any similar provision of state or local Law), in either case that would be binding on the Company
after the Closing Date.

 

(iii)
The Company will not be required to include any item of income in, or exclude any material item of deduction from, taxable income
for any taxable period (or portion thereof) ending after the Closing Date, as a result of any (i) installment sale or open transaction
disposition made on or prior to the Closing Date, (ii) prepaid amount received on or prior to the Closing Date (iii) change in
method of accounting for a Pre-Closing Tax Period or (iv) election pursuant to Section 108(i) of the Code (or any similar provision
of state, local or foreign Law) made with respect to any Pre-Closing Tax Period.

 

(iv)
None of the Sellers the Company is a foreign person within the meaning of Section 1445(f)(3) of the Code. The Company has not
been a United States real property holding corporation within the meaning of Section 897(c)(2) of the Code during the applicable
period specified in Section 897(c)(1)(A)(ii).

 

(v)
Except as set forth in Section 3.15(d)(v) of the Seller Disclosure Schedule, the Company has not received, been the subject
of, or requested a written ruling of a Governmental Authority relating to Taxes, and the Company has not entered into a Contract
with a Governmental Authority relating to Taxes that would have a continuing effect after the Closing.

 

(vi)
The Company has disclosed on its federal income Tax Returns all positions taken by it that could give rise to substantial understatement
of federal income Tax within the meaning of Section 6662 of the Code.

 

(vii)
The Company has not participated in any “reportable transaction” as defined in Treasury Regulation Section 1.6011-4(b).

 

    	19 

    	 

    

 

(viii)
Except as set forth in Section 3.15(d)(viii) of the Seller Disclosure Schedule, the Company is not, or will not be, subject
to a tax under Section 1374 of the Code for any taxable period (or portion thereof) ending on or before the Closing Date, including,
but not limited to, any such tax incurred in connection with the transactions contemplated by this Agreement.

 

3.16
Intellectual Property.

 

(a)
Section 3.16(a) of the Seller Disclosure Schedule sets forth a true and complete list of (i) all Registered Intellectual
Property Rights owned exclusively or partially by the Company (including the record owner and jurisdiction of registration application)
and (ii) all IP that is not Registered Intellectual Property Rights and that is owned exclusively or partially by the Company,
in each case properly identifying all applicable co-owners, if any. Except as set forth on Section 3.16(a) of the Seller
Disclosure Schedule, all Intellectual Property Rights that are Company IP (x) are valid and enforceable, (y) are owned free and
clear of all Encumbrances other than Permitted Encumbrances and (z) no Registered Intellectual Property has expired or been canceled
or abandoned except in accordance with the expiration of the term of such rights or where the Company has made a reasonable business
judgment to permit such registrations or applications to expire, be canceled, or become abandoned.

 

(b)
The Company own and possess, or have the right to use pursuant to a valid and enforceable Company License, all of the IP materials
necessary for the operation of the Business as now conducted and as currently proposed to be conducted. Without limiting the foregoing,
each current or former manager, officer, employee, consultant and contractor of the Company who has been involved in, or who contributed
to, the creation or development of the Company IP has executed and delivered to a Company a valid and enforceable assignment of
all rights, title and interests that such Person may have, may have had or may hereafter acquire in or to the Company IP. No current
or former manager, officer, employee, consultant or contractor of the Company has any right, license, claim, moral right or interest
whatsoever in or with respect to any of the Company IP. To the Knowledge of the Company, there is no IP that is used in or reasonably
necessary for the operation of the Business that will not be available to and usable by the Company without payment of any additional
consideration as of or as a result of the Closing.

 

3.17
Employees. Section 3.17 of the Seller Disclosure Schedule correctly sets forth the name, title, employer, current
annual compensation, total annual target compensation and accrued paid time-off of the Company Employees (including annual salary
(or hourly rate), bonus, commissions and any other payments), regardless of whether any of the Company Employees is absent from
active employment for any reason. Except as set forth in Section 3.17 of the Seller Disclosure Schedule, (a) to the Knowledge
of the Company, no executive or key employee of the Company or any group of employees of a Company has any plans to terminate
employment with the Company; and (b) neither the Company nor the Company Employees are subject to any noncompete, nondisclosure,
confidentiality, employment, consulting or similar agreements relating to, or in conflict with the present business activities
of the Company, except for agreements between the Company and its present and former employees, if any. As of the date hereof,
all commissions and bonuses payable to Company Employees and consultants or contractors of the Company for services performed
on or prior to the date hereof have been paid in full (or accrued in full and are not yet payable) and there are no outstanding
agreements, understandings or commitments of the Company with respect to any commissions, bonuses or increases in compensation.

 

    	20 

    	 

    

 

3.18
Labor Matters.

 

(a)
The Company is not a party to or bound by any labor or collective bargaining agreement applicable to the Company or to the Company
Employees. None of the Company Employees are represented by a labor union, and no petition has been filed, nor has any proceeding
been instituted by the Company Employee or group of Company Employees with any labor relations board or commission seeking recognition
of a collective bargaining representative. There is no organizational effort currently being made or, to the Knowledge of the
Company, threatened by or on behalf of any labor union to organize the Company Employees.

 

(b)
Except as set forth in Section 3.18(b) of the Seller Disclosure Schedule, the Company is in material compliance with all
Legal Requirements respecting labor, employment, fair employment practices, terms and conditions of employment, employee classification,
workplace health and safety, withholding and remittance of wages, data privacy, equal opportunity, workplace discrimination, immigration
matters and wages and hours, and there is no grievance, unfair labor practice charge or complaint against the Company or regarding
the Company Employees or group of Company Employees (or any former employees of the Company) pending or threatened before any
Governmental Authority.

 

(c)
The Company has not, since December 31, 2014, engaged in a plant closing or mass layoff that is subject to the WARN Act.

 

3.19
Environmental Compliance. Except as set forth in Section 3.19 of the Seller Disclosure Schedule:

 

(a)
The Company has complied and is in compliance with all Environmental and Safety Requirements.

 

(b)
Without limiting the generality of the foregoing, the Company has obtained and complied with, and is in compliance in all material
respects with, all permits, licenses and other authorizations that are required pursuant to Environmental and Safety Requirements
for the occupation of its facilities and the operation of its business.

 

(c)
The Company has not received any written or oral notice, report or other information regarding any actual or alleged violation
of Environmental and Safety Requirements, or any material liabilities or potential liabilities (whether accrued, absolute, contingent,
unliquidated or otherwise), including any investigatory, remedial or corrective obligations, relating to any of them or its facilities
arising under Environmental and Safety Requirements.

 

3.20
Related Party Transactions.

 

(a)
Except as set forth in Section 3.20(a) of the Seller Disclosure Schedule, the Company is not indebted, directly or indirectly,
to any of its managers or officers or to any member of their Immediate Families in any amount whatsoever, except for indebtedness
to employees for accrued salaries, bonuses and other employee benefits not yet payable or for reasonable business expenses actually
incurred. Except as set forth in Section 3.20(a) of the Seller Disclosure Schedule, none of the managers, officers or employees
of the Company, nor any member of their Immediate Families, is indebted to the Company or owed any money from a Company (any such
indebtedness, a “Related Party Debt”) as of the date hereof or has any direct or indirect ownership interest
in any firm or business entity with which the Company has a business relationship or competes (other than the ownership of one
percent (1%) or less of the outstanding voting securities of any such firm or business entity). No Related Party Debts will exist
as of immediately prior to the Closing Date. Except as set forth in Section 3.20(a) of the Seller Disclosure Schedule,
no officer, manager or director other than the Sellers, or any member of his or her Immediate Family, is, directly or indirectly,
interested in any Contract or transaction with the Company or the Company’s customers or suppliers or has any interest in
any assets or property used by a Company (including any Intellectual Property Rights or Technology).

 

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(b)
None of the Sellers or any of their respective Related Persons is indebted to a Company or has any direct or indirect ownership
interest in a Person with which a Company has a business relationship or competes (other than the ownership of one percent (1%)
or less of the outstanding publicly traded voting securities of any such firm or business entity). None of the Sellers or any
of their respective Related Persons is, directly or indirectly, interested in any Contract or transaction with the Company or
the Company’s customers or suppliers or has any interest in any assets or property used by a Company (including any Intellectual
Property Rights or Technology).

 

3.21
Certain Payments. Neither the Company nor any of its managers, officers, agents, employees or other Persons acting on behalf
of the Company has: (a) used any funds of the Company for unlawful contributions, payments, gifts, gratuities, entertainment or
other unlawful expenses related to political activity; (b) made any unlawful payment or unlawfully offered anything of value to
foreign or domestic government officials or employees or to foreign or domestic government officials or employees or to foreign
or domestic political parties or campaigns; (c) made any other unlawful payment; or (d) violated any applicable export control,
money laundering or anti-terrorism law or regulation, nor have any of them otherwise taken any action which would cause the Company
to be in violation of the Foreign Corrupt Practices Act of 1977, as amended, or any applicable Legal Requirement of similar effect.
Neither a Company nor any of its managers, officers, agents, employees or other Persons acting on behalf of the Company has accepted
or received any unlawful contributions, payments, gifts, gratuities, entertainment or other expenses.

 

3.22
Insurance.

 

(a)
Section 3.22(a) of the Seller Disclosure Schedule lists all insurance policies which are in effect covering the Company
and the assets, business, operations, employees, officers and managers of the Company (collectively, the “Insurance Policies”).
True and complete copies of all Insurance Policies have been provided or made available to Purchaser. All Insurance Policies are
in full force and effect and shall remain in full force and effect following the consummation of the transactions contemplated
by this Agreement. Neither the Company nor any of its Affiliates has received any written notice of cancellation of, premium increase
with respect to, or alteration of coverage under, any Insurance Policy. All premiums due on such Insurance Policies have either
been paid or, if due and payable prior to Closing, will be paid prior to Closing in accordance with the payment terms of each
Insurance Policy. The Insurance Policies and arrangements identified in Section 3.22(a) of the Seller Disclosure Schedule
are in adequate amounts and cover risk customarily insured against by a business of the type operated by the Company and are sufficient
for compliance with all applicable Legal Requirements and Contracts to which any of the Company is a party or by which it is bound.
Except as set forth in Section 3.22(a) of the Seller Disclosure Schedule, the Insurance Policies do not provide for any
retrospective premium adjustment or other experience based liability on the part of the Company. All such Insurance Policies (a)
are valid and binding in accordance with their terms; (b) are provided by carriers who are financially solvent; and (c) have not
been subject to any lapse in coverage. There are no claims related to the business of the Company pending under any such Insurance
Policies as to which coverage has been questioned, denied or disputed or in respect of which there is an outstanding reservation
of rights. The Company is not in default under, and has not otherwise failed to comply with any provision contained in any such
Insurance Policy.

 

    	22 

    	 

    

 

(b)
Section 3.22(b) of the Seller Disclosure Schedule sets forth the schedule of the reserves reflected in the Financial Statements
for litigation and claim exposure, whether known or unknown, and such reserves are adequate.

 

3.23
Books and Records. The minute books of the Company contain, in reasonable detail, in all material respects accurate and
complete records of all meetings held and actions taken by written consent of, the equity holders and governing authority the
Company, and no meeting, or action taken by written consent, of any such equity holders or governing authority has been held or
taken for which minutes have not been prepared and are not contained in such minute books if required under applicable Legal Requirements.

 

3.24
Customers and Suppliers.

 

(a)
Section 3.24(a) of the Seller Disclosure Schedule sets forth with respect to the top ten (10) customers of the Company
(on a consolidated basis) for each of the two most recent fiscal years, the names and addresses of such customers and the amount
for which each such customer was invoiced during such period. The Company has not received any written notice that any significant
customer of the Company (i) has ceased, or will cease, to use the products or services of the Company, or (ii) has substantially
reduced or will substantially reduce, the use of products or services of the Company. The Company is not involved in any material
disputes with any of the top 10 customers. Except for payments received in the ordinary course of business consistent with past
practice, the Company has not received payment in advance of any services or prepayment for products or services not yet developed
or delivered.

 

(b)
Section 3.24(b) of the Seller Disclosure Schedule sets forth with respect to the top ten (10) suppliers of the Company
(on a consolidated basis) for each of the two most recent fiscal years, the names and addresses of such suppliers and the amount
for which each such supplier invoiced the applicable Company during such period. The Company has not received any written notice,
and has no reason to believe, that any significant supplier of the Company (i) has ceased, or will cease, to supply products or
services to the Company, (ii) has substantially reduced or will substantially reduce, the supply of products or services to the
Company, or (iii) has sought, or is seeking, to increase the price the Company will pay for products or services of such supplier,
including in each case after the consummation of the transactions contemplated hereby. The Company is not involved in any material
disputes with any of the top 15 suppliers. Except for payments made in the ordinary course of business consistent with past practice,
the Company has not paid any supplier in advance for any services or made any prepayment for products or services not yet developed
or delivered by any supplier.

 

3.25
Warranties. No products or services sold by the Company are subject to any warranty provided by the Company beyond any
warranty contained in applicable standard terms and conditions of sale and any warranties imposed by or arising under applicable
Legal Requirements.

 

3.28
Data Protection; Privacy; IT Systems. The Company has been and is in compliance in all material respects with any and all
applicable Legal Requirements, contractual requirements, terms of use and privacy policies pertaining to data protection or information
privacy, security, collection, use, disclosure, disposal, maintenance and transmission. Such privacy policies have been and are
substantially accurate and consistent with respect to the Company’s actual practices with respect to data protection or
information privacy and the use of personal data collected by the Company.

 

    	23 

    	 

    

 

3.29
Anti-Corruption and Trade Controls.

 

(a)
The Company and, to the Knowledge of the Company, any Person acting for or on behalf of the Company (collectively, the “Relevant
Persons”), has not violated any provision of any applicable anti-corruption or anti-bribery laws or regulations.

 

(b)
The Relevant Persons have not directly or indirectly made any payment or any other transfer of value (or offer, promise, or authorization
thereof) to any individual or entity, including any government official, for the purpose of: (i) improperly influencing or inducing
such individual or entity to do or omit to do any act or to make any decision in an official capacity or in violation of a lawful
duty, (ii) inducing such individual or entity to influence improperly his or her or its employer, public or private, or any Governmental
Authority, to affect an act or decision of such employer or Governmental Authority, including to assist any individual or entity
in obtaining or retaining business or (iii) securing any improper advantage.

 

3.30
Bank Accounts. Section 3.30 of the Seller Disclosure Schedule lists all of the Company’s bank accounts (designating
each authorized signatory and the level of each signatory’s authorization).

 

3.31
Brokers or Finders. None of the Company or any of the Sellers has entered into any Contract entitling any agent, broker,
investment banker, financial advisor or other firm or Person to any broker’s or finder’s fee or any other commission
or similar fee in connection with any of the transactions contemplated hereby.

 

3.32
No Other Representations or Warranties. Except for the representations and warranties contained in this Article III
(including the related portions of the Seller Disclosure Schedule), none of the Sellers, the Company or any other Person has
made or makes any other express or implied representation or warranty, either written or oral, on behalf of the Sellers or the
Company, including any representation or warranty as to the accuracy or completeness of any information regarding the Company
furnished or made available to Purchaser and its representatives (including any information, documents or material made available
to Purchaser in any data room, management presentations or in any other form in expectation of the transactions) or as to the
future revenue, profitability or success of the Company, or any representation or warranty arising from statute or otherwise in
applicable Legal Requirements.

 

Article
IV

Representations and Warranties of Purchaser

 

Purchaser
represents and warrants to the Sellers and the Principals as set forth in this Article IV.

 

4.1
Organization. The Purchaser is a corporation duly organized, validly existing and in good standing under the laws the State
of Texas and has all requisite corporate power and authority to carry on its business as now being conducted and to own, use and
lease the properties and assets it now owns.

 

4.2
Authorization. The Purchaser has full corporate power and authority to execute and deliver this Agreement and the Transaction
Documents to which it is a party and to consummate the transactions contemplated hereby and thereby. The execution and delivery
by the Purchaser of this Agreement, and the Transaction Documents to which it is a party, and the performance by the Purchaser
of obligations hereunder and thereunder and the consummation by the Purchaser of the transactions contemplated hereby and thereby
have been duly authorized by all necessary corporate action on the part of the Purchaser. Assuming the due and valid authorization,
execution and delivery hereof by the Sellers, this Agreement is a valid and binding obligation of the Purchaser enforceable against
the Purchaser in accordance with its terms, except as limited by Enforceability Limitations. Assuming the due and valid authorization,
execution and delivery of the Transaction Documents to which they are a party by the Sellers, the Transaction Documents to which
a Purchaser is a party, when executed and delivered by the Purchaser, will be a valid and binding obligation of the Purchaser
enforceable against the Purchaser in accordance with their terms, except as limited by the Enforceability Limitations.

 

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4.3
Execution and Validity. This Agreement has been duly executed and delivered by Purchaser. Assuming the due and valid authorization,
execution and delivery hereof by the Sellers, this Agreement is a valid and binding obligation of Purchaser enforceable against
Purchaser in accordance with its terms, except as limited by the Enforceability Limitations.

 

4.4
Consents and Approvals; No Violations. None of the execution and delivery by the Purchaser of this Agreement or the Transaction
Documents to which either is a party, the performance by the Purchaser of its obligations hereunder or thereunder, nor the consummation
by the Purchaser of the transactions contemplated hereby or thereby will (a) conflict with or result in any breach of any provision
of the Organizational Documents of the Purchaser, each as amended to date or (b) require any declaration or filing with, or permit,
authorization, consent or approval of, any Governmental Authority save and except for the Texas Public Utility Commission.

 

4.5
Litigation. There is no action, suit, charge, claim or proceeding, at law or in equity, pending or, to the actual knowledge
of the Purchaser, threatened against, the Purchaser that challenges or seeks to prevent, enjoin or otherwise delay the transactions
contemplated by this Agreement.

 

4.6
Brokers or Finders. The Purchaser has not entered into any Contract entitling any agent, broker, investment banker, financial
advisor or other firm or Person to any broker’s or finder’s fee or any other commission or similar fee in connection
with any of the transactions contemplated hereby.

 

4.7
Investment Purpose. Purchaser is acquiring the Purchased Equity Interests for its own account for investment purposes and
not with a view to, or for offer or sale in connection with, any distribution thereof. Purchaser acknowledges that the Purchased
Equity Interests are not registered under the Securities Act of 1933, as amended, or any state securities laws, and that the Purchased
Equity Interests may not be transferred or sold except pursuant to the registration provisions of the Securities Act of 1933,
as amended, or pursuant to an applicable exemption therefrom and subject to state securities laws and regulations, as applicable.
Purchaser is able to bear the economic risk of holding the Purchased Equity Interests for an indefinite period (including total
loss of its investment), and has sufficient knowledge and experience in financial and business matters so as to be capable of
evaluating the merits and risk of its investments.

 

4.8
Independent Investigation; No Reliance. Purchaser has conducted its own independent investigation, review and analysis
of the business, results of operations, prospects, condition (financial or otherwise) and assets of the Company and the Purchased
Equity Interests and acknowledges that it has been provided adequate access to the personnel, properties, assets, premises, books
and records, and other documents and data of the Sellers and the Company for such purpose. Purchaser acknowledges and agrees that:
(a) Purchaser has had the benefit of legal counsel of its own choosing in connection with the negotiation, preparation and execution
of this Agreement, (b) in making its decision to enter into this Agreement and to consummate the transactions contemplated hereby,
Purchaser has relied solely upon its own investigation and the express representations and warranties of the Sellers set forth
in Article III of this Agreement (including the related portions of the Seller Disclosure Schedule); and (c) none of the Sellers,
the Company, the Principals, or any other Person has made, and Purchaser has not relied upon, any representation or warranty as
to the Sellers or the Company, except as expressly set forth in Article III of this Agreement (including the related portions
of the Seller Disclosure Schedule).

 

    	25 

    	 

    

 

Article
V

Conduct Prior to the Closing Date

 

5.1
Interim Operations of the Company. From the date hereof through the Closing Date, except (i) as otherwise expressly provided
in this Agreement or the Transaction Documents, or (ii) as may be consented to by Purchaser in writing, the Sellers shall cause
the Company to:

 

(a)
conduct its business only in the usual and ordinary course and shall use best efforts to maintain the value of its business as
a going concern and its relationships with its current customers, suppliers, vendors, employees, agents and other Persons having
material business relationships with the Company and preserve for Purchaser unimpaired the goodwill of such customers, suppliers,
vendors, employees, agents and other Persons;

 

(b)
confer with Purchaser concerning operational matters of a material nature;

 

(c)
not take any affirmative action, or fail to take any reasonable action within its control, which, if occurring within the time
period specified in Section 3.7, would be required to be disclosed on Section 3.7 of the Seller Disclosure Schedule;

 

(d)
preserve and maintain all Company Permits required for the conduct of the Company’s business;

 

(e)
pay the debts, Taxes and other obligations of the Company when due;

 

(f)
continue to collect accounts receivable in a manner consistent with past practice, without discounting such accounts receivable;

 

(g)
maintain the properties and assets of the Company in the same condition as they were on the date of this Agreement, subject to
reasonable wear and tear;

 

(h)
continue in full force and effect without modification all Insurance Policies;

 

(i)
defend and protect the properties and assets of the Company from infringement or usurpation;

 

(j)
perform all of its obligations under all Material Contracts;

 

(k)
maintain the Books and Records in accordance with past practice; and

 

(l)
comply in all material respects with all Legal Requirements applicable to the conduct of the Company’s business or the ownership
and use of the Company’s assets.

 

5.2
Communications to Company Employees. Prior to making any written or material broad-based oral communications to the current
or former officers or employees of the Company, including the Company Employees, pertaining to compensation or benefit matters
that are affected by the transactions contemplated by this Agreement, the Sellers shall cause the Company to provide Purchaser
with a copy of the intended communication, and Purchaser shall have a reasonable period of time to review and comment on the communication
and shall promptly respond to the Company (such response to take no more than five (5) Business Days), and Purchaser and the Company
shall cooperate in providing any such mutually agreeable communication.

 

    	26 

    	 

    

 

5.3
Control of Operations. Nothing contained in this Agreement shall be deemed to give Purchaser or the Company, directly or
indirectly, the right to control or direct the operations of the other prior to the Closing Date. Prior to the Closing Date, the
Purchaser and Company shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision
over its respective operations.

 

Article
VI

Covenants

 

6.1
Access. Until the earlier of the Closing Date or the termination of this Agreement pursuant to its terms, the Company shall
give Purchaser and its authorized representatives full access to all books, records, Contracts, personnel, offices and other facilities
and properties of the Company; provided, however, that any such access to the Company’s facilities
shall be conducted at a reasonable time during normal business hours, under the supervision of the Company’s personnel and
in such a manner as to maintain the confidentiality of this Agreement and the transactions contemplated hereby and not to interfere
unreasonably with the normal operation of the business of the Company. Notwithstanding anything to the contrary in this Agreement,
neither Seller nor the Company shall be required to disclose any information to Purchaser if such disclosure would, in Sellers’
sole discretion: (i) jeopardize any attorney-client or other privilege; or (ii) contravene any applicable Legal Requirements,
fiduciary duty or binding agreement entered into prior to the date of this Agreement.

 

6.2
Confidentiality.

 

(a)
Each of the Parties (i) shall itself, (ii) shall cause its employees and other Representatives to, (iii) shall cause each of its
Affiliates itself to, and (iv) shall cause each of its Affiliates to cause its employees and other Representatives to, in each
case, keep confidential and not disclose the terms of this Agreement to any third party; provided, however, that
disclosure of such aspects of this Agreement is permitted: (A) with the prior written consent of either a Purchaser (if the disclosing
Party is a Seller) or the Sellers (if the disclosing Party is a Purchaser); (B) to a Party’s professional advisers on a
need-to-know basis and subject to their agreement to keep such aspects of this Agreement confidential; (C) to the extent that
enforcement of this Agreement’s terms, applicable Legal Requirements or legal process requires public disclosure; (D) in
connection with the sale of or other disposition, in whole or in part, of Purchaser or the Company (or any person that controls
either of them) following the Closing or any interest in any of them (but then only if such disclosure is subject to a non-disclosure
agreement then customary in such transactions); or (E) in connection with a claim by a person that could give rise to a claim
against a Party. If any public disclosure is required pursuant to clause (C) above, then the party required to make such disclosure
(1) will give notice of such disclosure to the other so that the other may seek a protective order or other protective arrangement
to the extent permitted by applicable Legal Requirements or other similar or appropriate relief and (2) will undertake in good
faith to limit the manner and extent of such disclosure, requiring to the extent practical that the person to whom the disclosure
is made maintain the confidentiality of the disclosed terms to the extent possible.

 

(b)
Each Seller (i) shall itself, (ii) shall cause its employees and other Representatives to, (iii) shall cause each of its Affiliates
itself to, and (iv) shall cause each of its Affiliates to cause its employees and other Representatives to, in each case keep
confidential and not disclose all information, whether written or oral, concerning the Business, except to the extent that disclosing
Party can show that such information (A) is generally available to and known by the public through no fault of any Seller or (b)
is lawfully acquired by a Seller from and after the Closing from sources which are not prohibited from disclosing such information
by a legal, contractual or fiduciary obligation. Sellers will be responsible for violations of the obligations of this Section
6.2 by their Affiliates and their and their Affiliates’ Representatives.

 

    	27 

    	 

    

 

6.3
No Solicitation.

 

(a)
From and after the date of this Agreement until the earlier of the Closing Date or the termination of this Agreement pursuant
to its terms, each of the Sellers shall not, and shall cause each of the Company not to, nor shall any of them authorize or permit
(to the extent within its power and authority) any of their respective managers, officers, Affiliates, trustees or employees or
any investment banker, advisor, representative or other agent of the Company or Seller to, directly or indirectly, (i) encourage,
solicit, initiate, facilitate or continue inquiries regarding an Acquisition Proposal; (ii) enter into discussions or negotiations
with, or provide any information to, any Person concerning a possible Acquisition Proposal; or (iii) enter into any agreements
or other instruments (whether or not binding) regarding an Acquisition Proposal. The Sellers shall immediately cease and cause
to be terminated, and shall cause their Affiliates and all of their and their Affiliates’ Representatives to immediately
cease and cause to be terminated, all existing discussions or negotiations with any Persons conducted heretofore with respect
to, or that could lead to, an Acquisition Proposal. For purposes hereof, “Acquisition Proposal” means any inquiry,
proposal or offer from any Person (other than Purchaser or any of their Affiliates) concerning (i) a merger, consolidation, liquidation,
recapitalization, equity exchange or other business combination transaction involving the Company; (ii) the issuance or acquisition
of equity securities of any of the Company; or (iii) the sale, lease, exchange or other disposition of any significant portion
of the Company’s properties or assets.

 

(b)
In addition to the obligations of the Sellers with respect to the Company set forth in Section 6.3(a), the Sellers shall,
as promptly as practicable (and in any event within three (3) Business Days after receipt thereof by the Company or Seller or
their respective Representatives), notify Purchaser of any Acquisition Proposal or any request for nonpublic information or other
inquiry which a Company or any Seller believes could lead to an Acquisition Proposal, the material terms and conditions of such
Acquisition Proposal, request or inquiry, and the identity of the Person or group making any such Acquisition Proposal, request
or inquiry. The Company and Sellers shall keep Purchaser informed as promptly as practicable in all material respects of the status
and details (including material amendments or proposed amendments) of any such Acquisition Proposal, request or inquiry. The Sellers
agree that the rights and remedies for noncompliance with this Section 6.3 shall include having such provision specifically
enforced by any court having equity jurisdiction, it being acknowledged and agreed that any such breach or threatened breach shall
cause irreparable injury to Purchaser and that money damages would not provide an adequate remedy to Purchaser.

 

6.4
Public Disclosure. Purchaser and the Sellers, or any of the foregoing, shall not make any public disclosure concerning
this Agreement or any of the other transactions contemplated hereby without the prior written consent of Purchaser and the Sellers,
except as may be required by any applicable Legal Requirement.

 

    	28 

    	 

    

 

6.5
Reasonable Efforts; Notification.

 

(a)
Upon the terms and subject to the conditions set forth in this Agreement, each of the Parties agrees to use all commercially reasonable
efforts to take, or cause to be taken, all actions, and to do, or cause to be done, and to assist and cooperate with the other
Parties in doing, all things necessary, proper or advisable (subject to any applicable Legal Requirements) to consummate and make
effective, in the most expeditious manner practicable and the transactions contemplated by this Agreement, including using all
commercially reasonable efforts to accomplish the following: (i) causing the conditions precedent set forth in Article VIII
to be satisfied, (ii) obtaining all necessary actions or non-actions, waivers, consents, approvals, orders and authorizations
from Governmental Entities including, without limitation, from the Texas Public Utilities Commission, and making all necessary
registrations, declarations and filings (including registrations, declarations and filings with Governmental Entities) and taking
all lawful steps that may be necessary to avoid any suit, claim, action, investigation or proceeding by any Governmental Authority,
(iii) obtaining all necessary consents, approvals or waivers from, and giving all necessary notices to, third parties, (iv) defending
any suits, claims, actions, investigations or proceedings, whether judicial or administrative, challenging this Agreement or the
consummation of the transactions contemplated hereby, including seeking to have any stay or temporary restraining order entered
by any court or other Governmental Authority vacated or reversed, and (v) executing and delivering any additional instruments
necessary to consummate the transactions contemplated by, and to fully carry out the purposes of, this Agreement.

 

(b)
From the date hereof until the Closing, the Sellers shall promptly notify Purchaser in writing of:

 

(i)
any fact, circumstance, event or action the existence, occurrence or taking of which (A) has had, or could reasonably be expected
to have, individually or in the aggregate, a Company Material Adverse Effect, (B) has resulted in, or could reasonably be expected
to result in, any representation or warranty made by the Sellers hereunder not being true and correct or (C) has resulted in,
or could reasonably be expected to result in, the failure of any of the conditions set forth in Section 8.2 to be satisfied;

 

(ii)
any notice or other communication from any Person alleging that the consent of such Person is or may be required in connection
with the transactions contemplated by this Agreement;

 

(iii)
any notice or other communication from any Governmental Authority in connection with the transactions contemplated by this Agreement;
and

 

(iv)
any actions commenced or, to the Knowledge of the Company, threatened against, relating to or involving or otherwise affecting
the Business or the Company that, if pending on the date of this Agreement, would have been required to have been disclosed pursuant
to Section 3.12 or that relates to the consummation of the transactions contemplated by this Agreement.

 

(c)
Purchaser’s receipt of information pursuant to this Section 6.5 shall not operate as a waiver or otherwise affect
any representation, warranty or agreement given or made by the Sellers in this Agreement and shall not be deemed to amend or supplement
the Seller Disclosure Schedule.

 

6.6
Payoff Letters. Prior to the Closing, the Company shall obtain a letter from each holder of any Indebtedness of the Company,
or any Person owed Company Transaction Costs in an amount in excess of $5,000, in form and substance reasonably acceptable to
Purchaser (collectively, the “Payoff Letters”), (i) setting forth the amount of such Indebtedness or Company
Transaction Costs and wire instructions for payment of such amount as of the Closing, and (ii) confirming that upon the holder’s
receipt of such payment, such Indebtedness or Company Transaction Costs will be fully satisfied and such holder will immediately
release all Encumbrances relating to such Indebtedness or Company Transaction Costs. Concurrent with the Closing and to the extent
such amounts are not paid by the Company prior to the Closing, Purchaser will cause the Company to pay the amount of such Indebtedness
or Company Transaction Costs as set forth in the Payoff Letters and described more fully on the Company Closing Transaction Costs
Certificate and the Company Closing Indebtedness Certificate.

 

    	29 

    	 

    

 

Article
VII

Tax
Matters

 

7.1
Covenants Regarding Taxes.

 

(a)
All Taxes of the Company and the Sellers attributable to any Pre-Closing Tax Period (including any penalties and interest thereon)
shall be borne and paid by the Sellers when due. The Sellers shall, at their own expense, timely file any Tax Return or other
document with respect to such Taxes (and Purchaser shall cooperate with respect thereto as necessary).

 

(b)
All income, transfer, documentary, sales, use, stamp, registration, value added and other such Taxes and fees (including any penalties
and interest) incurred in connection with this Agreement and the other Transaction Documents (including any real property transfer
Tax and any other similar Tax) shall be borne and paid by the Sellers when due. The Sellers shall, at their own expense, timely
file any Tax Return or other document with respect to such Taxes or fees (and Purchaser shall cooperate with respect thereto as
necessary).

 

(c)
Purchaser shall prepare, or cause to be prepared, all non-income Tax Returns required to be filed by the Company after the Closing
with respect to a Pre-Closing Tax Period. Any such Tax Return shall be submitted by Purchaser to Sellers (together with schedules,
statements and, to the extent requested by Sellers, supporting documentation) at least 30 days prior to the due date (including
extensions) of such Tax Return. If Sellers object to any item on any such Tax Return that could reasonably be expected to materially
and adversely impact on the Sellers, it shall, within fifteen (15) days after delivery of such Tax Return, notify Purchaser in
writing that it so objects, specifying with particularity any such item and stating the specific factual or legal basis for any
such objection. If a notice of objection shall be duly delivered, Purchaser and Sellers shall negotiate in good faith and use
their reasonable best efforts to resolve such items. If Purchaser and Sellers are unable to reach such agreement within ten days
after receipt by Purchaser of such notice, the disputed items shall be resolved by a nationally recognized accounting firm selected
by Purchaser and reasonably acceptable to Sellers (the “Accounting Referee”) and any determination by the Accounting
Referee shall be final. The Accounting Referee shall resolve any disputed items within twenty (20) days of having the item referred
to it pursuant to such procedures as it may require. If the Accounting Referee is unable to resolve any disputed items before
the due date for such Tax Return, the Tax Return shall be filed as prepared by Purchaser and then amended to reflect the Accounting
Referee’s resolution. The costs, fees and expenses of the Accounting Referee shall be borne equally by Purchaser and Sellers.
The preparation and filing of any Tax Return of the Company that does not relate to a Pre-Closing Tax Period shall be exclusively
within the control of Purchaser.

 

7.2
Termination of Existing Tax Sharing Agreements. Sellers shall cause the Company to terminate any and all existing Tax sharing
agreements (whether written or not) binding upon the Company prior to the Closing. After such date no Company shall have any further
rights or liabilities thereunder.

 

7.3
Straddle Period. In the case of Taxes that are payable with respect to a taxable period that begins before and ends after
the Closing Date (each such period, a “Straddle Period”), the portion of any such Taxes that are treated as
Pre-Closing Taxes for purposes of this Agreement shall be:

 

    	30 

    	 

    

 

(a)
in the case of Taxes that are either (A) based upon or related to income or receipts, or (B) imposed in connection with any sale
or other transfer or assignment of property (real or personal, tangible or intangible), deemed equal to the amount that would
be payable if the Tax period of a Company ended as of the close of business on the Closing Date; provided that exemptions,
allowances or deductions that are calculated on an annual basis (including depreciation and amortization deductions) shall be
allocated between the period ending on and including the Closing Date and the period beginning after the Closing Date in proportion
to the number of days in each period; and

 

(b)
in the case of Taxes that are imposed on a periodic basis with respect to the assets or capital of a Company, deemed to be the
amount of such Tax for the entire taxable period (or, in the case of such Taxes determined on an arrears basis, the amount of
such Taxes for the immediately preceding period), multiplied by a fraction the numerator of which is the number of calendar days
in the portion of the period ending on the close of business on the Closing Date and the denominator of which is the number of
calendar days in the entire period.

 

7.4
Contests. Purchaser agree to give written notice to Sellers of the receipt of any written notice by Purchaser or its Affiliates
which involves the assertion of any claim, or the commencement of any Action, in respect of which an indemnity may be sought by
Purchaser pursuant to Article IX (a “Tax Claim”); provided, that failure to comply with this
provision shall not affect Purchaser’s right to indemnification hereunder. Purchaser shall control the contest or resolution
of any Tax Claim; provided, however, that Purchaser shall obtain the prior written consent of Sellers (which consent shall
not be unreasonably withheld or delayed) before entering into any settlement of a claim or ceasing to defend such claim; and,
provided further, that Sellers shall be entitled to participate in the defense of such claim and to employ counsel of its
choice for such purpose, the fees and expenses of which separate counsel shall be borne solely by Sellers.

 

7.5
Cooperation and Exchange of Information. Purchaser and the Sellers shall provide each other with such cooperation and information
as either of them reasonably may request of the other in filing any Tax Return pursuant to this Article VII or in connection
with any audit or other proceeding in respect of Taxes of the Company. Such cooperation and information shall include providing
copies of relevant Tax Returns or portions thereof, together with accompanying schedules, related work papers and documents relating
to rulings or other determinations by tax authorities. Each of the Purchaser and the Sellers shall retain all Tax Returns, schedules
and work papers, records and other documents in its possession relating to Tax matters of a Company for any taxable period beginning
before the Closing Date until the expiration of the statute of limitations of the taxable periods to which such Tax Returns and
other documents relate, without regard to extensions except to the extent notified by the other party in writing of such extensions
for the respective Tax periods. Prior to transferring, destroying or discarding of any Tax Returns, schedules and work papers,
records and other documents in its possession relating to Tax matters of a Company for any taxable period beginning before the
Closing Date, Purchaser and the Sellers (as the case may be) shall provide the other party with reasonable written notice and
offer the other party the opportunity to take custody of such materials; provided, however, Purchaser shall not be required
to provide such notice with respect to any taxable period ending more than 4 years prior to such transfer, destruction or discard.

 

7.6
Tax Treatment of Indemnification Payments. Any indemnification payments pursuant to this Article VII or any other
provision of this Agreement shall be treated as an adjustment to the Closing Purchase Price by the parties for Tax purposes, unless
otherwise required by Law.

 

    	31 

    	 

    

 

Article
VIII

Closing
Conditions

 

8.1
Conditions to Obligations of Sellers. The obligations of Sellers to consummate the transactions contemplated by this Agreement
and to take the other actions required to be taken by Sellers are subject to the satisfaction at or prior to the Closing Date
of each of the following conditions, any of which may be waived, in writing, exclusively by the Sellers:

 

(a)
Representations and Warranties. Each representation and warranty of Purchaser contained in this Agreement or in any schedule
delivered pursuant hereto (i) that is qualified as to materiality, shall be true and correct when made and as of the Closing Date,
and (ii) that is not qualified as to materiality, shall be true and correct in all material respects when made and on and as of
the Closing Date, in each case with the same force and effect as if made on the Closing Date (except that those representations
and warranties which address matters only as of a particular date shall be true and correct as of such particular date), and the
Sellers shall have received a certificate to such effect signed on behalf of Purchaser by an authorized officer of Purchaser to
such effect.

 

(b)
Agreements and Covenants. Purchaser shall have performed or complied in all material respects with all agreements and covenants
required by this Agreement to be performed or complied with by it on or prior to the Closing Date, and the Sellers shall have
received a certificate to such effect signed on behalf of Purchaser by an authorized officer of Purchaser, provided that with
respect to agreements, covenants and conditions that are qualified by materiality, Purchaser shall have performed such agreements,
covenants and conditions, as so qualified, in all respects.

 

(c)
No Order. No Governmental Authority shall have enacted, issued, promulgated, enforced or entered any Legal Requirement
or Order which is in effect and which has the effect of making illegal, restraining or otherwise prohibiting the consummation
of the transactions contemplated by this Agreement.

 

(d)
Consents. All approvals, consents and waivers (including all material consents, approvals, permits of, authorizations from,
notifications to and filings with any Governmental Entities including, without limitation, the Texas Public Utilities Commission)
shall have been received and executed counterparts thereof shall have been delivered to the Sellers.

 

(e)
Transaction Documents. Purchaser shall have delivered to the Sellers duly executed counterparts to the Transaction Documents
(other than this Agreement) to which it is a party and such other documents and deliveries set forth in Section 2.7(b)
and any third parties to the Transaction Documents shall have delivered executed counterparts to such Transaction Documents to
the Sellers.

 

(f)
Additional Documents. Purchaser shall have delivered to the Sellers such other documents or instruments as they reasonably
request that are reasonably necessary to consummate the transactions contemplated by this Agreement.

 

8.2
Conditions to Obligations of Purchaser. The obligation of Purchaser to consummate the transactions contemplated by this
Agreement and to take the other actions required to be taken by Purchaser is subject to the satisfaction at or prior to the Closing
Date of each of the following conditions, any of which may be waived, in writing, exclusively by Purchaser:(a)

 

(a)
Representations and Warranties. Each representation and warranty of the Sellers contained in this Agreement or in any schedule
delivered pursuant hereto (i) that are qualified as to materiality, shall be true and correct when made and as of the Closing
Date and (ii) that are not qualified as to materiality, shall be true and correct in all material respects when made and on and
as of the Closing Date, in each case with the same force and effect as if made on the Closing Date (except that those representations
and warranties which address matters only as of a particular date shall be true and correct as of such particular date), and Purchaser
shall have received a certificate to such effect signed by each Seller.

 

    	32 

    	 

    

 

(b)
Agreements and Covenants. The Sellers shall have performed or complied in all material respects with all agreements and
covenants required by this Agreement to be performed or complied with by it on or prior to the Closing Date and Purchaser shall
have received a certificate to such effect signed by each Seller.

 

(c)
No Order or Restraints. No Governmental Authority shall have enacted, issued, promulgated, enforced or entered any Legal
Requirement or Order which is in effect and which has the effect of making illegal or otherwise prohibiting the consummation of
the transactions contemplated by this Agreement. There shall not be pending any action, suit or proceeding shall have been commenced
against Purchaser, the Company or the Sellers seeking to or which would prevent the Closing. No injunction or restraining order
shall have been issued by any Governmental Authority, and be in effect, which restrains or prohibits any transaction contemplated
hereby.

 

(d)
Consents. All approvals, consents and waivers required to be obtained for the consummation of the transactions contemplated
by this Agreement shall have been obtained (including those listed on Section 3.3 of the Seller Disclosure Schedule, together
with all material consents, approvals, permits of, authorizations from, notifications to and filings with any Governmental Entities
including, without limitation, the Texas Public Utilities Commission) and executed counterparts thereof shall have been delivered
to Purchaser.

 

(e)
Luminant Contract. All approvals, consents and waivers shall have been obtained from Luminant as required by Luminant in
connection with the Company change of control resulting from the transactions contemplated by this Agreement and the Company and
Luminant have executed and delivered, effective as of the Closing Date, such assignments and amendments to the Luminant Contract,
and to the agreements and other instruments entered into in connection therewith, as may be reasonably required by Luminant in
connection with the transactions contemplated by this Agreement.

 

(f)
Company Material Adverse Effect. No Company Material Adverse Effect shall have occurred since the date of this Agreement,
nor shall any event or events have occurred that, individually or in the aggregate, with or without the lapse of time, could reasonably
be expected to result in a Company Material Adverse Effect.

 

(g)
Transaction Documents. The Sellers shall have duly executed and delivered to Purchaser the Transaction Documents to which
each is a party respectively and such other documents and deliveries set forth in Section 2.7(a), including, without limitation,
the Seller Disclosure Schedule in a form acceptable to Purchaser, and any third parties to the Transaction Documents shall have
delivered executed counterparts to such Transaction Documents to Purchaser.

 

(h)
Third-Party Obligations. The Sellers shall have delivered to Purchaser written evidence (in form and substance reasonably
satisfactory to Purchaser) that the fees and expenses owing to the Company’s and the Sellers’ investment bankers,
financial advisors, counsel, auditors and other advisors in connection with the transactions contemplated hereby have been paid
in full, and that no Company has any liability (including any indemnification obligations) to any of the Company’s and the
Sellers’ investment bankers, counsel, auditors or other advisors.

 

    	33 

    	 

    

 

(i)
Release of Encumbrances. The Sellers shall have caused the Company to have obtained releases of all Encumbrances (other
than any Permitted Encumbrances) relating to the assets and properties of the Company or the Purchased Equity Interests, or confirmation
that such Encumbrances will be released upon receipt of the amounts set forth in the applicable Payoff Letter.

 

(j)
Retention of Key Employees. None of the Key Employees shall have been involuntarily terminated, voluntarily terminated
his or her employment, or communicated any intention of voluntarily terminated his or her employment following the Closing.

 

(k)
Additional Documents. The Sellers shall have delivered to Purchaser such other documents or instruments as are required
to be delivered by the Sellers at the Closing pursuant to the terms hereof or that Purchaser reasonably request prior to the Closing
Date to effect the transactions contemplated hereby.

 

Article
IX

Indemnification
and Survival

 

9.1
Survival. Subject to the limitations and other provisions of this Agreement, the representations and warranties contained
herein shall survive the Closing and shall remain in full force and effect until the date that is eighteen (18) months after the
Closing Date; provided, however, that the representations and warranties in (i) Sections 3.1, 3.2, 3.3, 3.4 and
3.31 (the “Core Reps”) shall survive indefinitely and (ii) Sections 3.14, 3.15 and 3.29
(the “Statutory Reps”) shall survive for the full period of all applicable statutes of limitations with
respect to the subject matter of such representation and warranty (giving effect to any waiver, mitigation or extension thereof)
plus an additional thirty (30) days. All covenants and agreements of the parties contained herein shall survive the Closing indefinitely
or for the period explicitly specified therein. Notwithstanding the foregoing, (a) any claims asserted in good faith with reasonable
specificity (to the extent known at such time) and in writing by notice from the non-breaching party to the breaching party prior
to the expiration date of the applicable survival period shall not thereafter be barred by the expiration of the relevant representation
or warranty and such claims shall survive until finally resolved and (b) the foregoing survival limitations would not apply in
the event of fraud or willful breach of this Agreement.

 

9.2
Indemnification of Purchaser. Subject to the limitations set forth in this Article IX, the Sellers and the Principals,
jointly and severally, shall indemnify and defend Purchaser, and its managers, officers, employees, agents, Affiliates, heirs,
executors, personal representatives, successors and assigns, including, from and after the Closing, the Company (the “Purchaser
Indemnified Parties”), and hold each of them harmless from and against, and shall pay and reimburse each of them for,
any and all Losses incurred, sustained by, or imposed upon any Purchaser Indemnified Party based upon, arising out of, with respect
to or as a result of:

 

(a)
any breach of, or inaccuracy in, any representation or warranty contained in Article III of this Agreement, or any of the
Transaction Documents or any other certificate or document delivered to Purchaser on behalf of the Company or the Sellers pursuant
hereto (in each case as such representation or warranty would read if all qualifications as to materiality and material adverse
effect or similar qualifications were deleted therefrom for the purpose of determining whether a breach thereof occurred and for
determining the Losses for which the Indemnified Parties are entitled to indemnification hereunder);

 

    	34 

    	 

    

 

(b)
any breach or non-fulfillment of any covenant or agreement of the Sellers contained in this Agreement (including the Seller Disclosure
Schedule), or any of the Transaction Documents;

 

(c)
any liabilities for Taxes (including penalties or interest thereon) to the extent based upon, resulting from or arising out of
the transactions contemplated hereby or the business, operations, properties, assets or obligations of the Sellers, the Company,
or any of their respective Affiliates conducted, relating to or arising on or prior to the Closing Date;

 

(d)
any Indebtedness of the Company or Current Liabilities as of the Closing Date, or Company Transaction Costs, in each case to the
extent not included on the Indebtedness Schedule or the Working Capital Schedule; and

 

9.3
Indemnification of the Sellers. Subject to the limitations set forth in this Article IX, Purchaser shall indemnify
and defend the Sellers and the Principals and their respective heirs, executors, personal representatives, successors and assigns
of the foregoing Persons (the “Seller Indemnified Parties”), and hold each of them harmless from and against
and shall pay and reimburse each of them for, any and all Losses incurred, sustained by, or imposed upon the Seller Indemnified
Parties based upon, arising out of, with respect to or as a result of:

 

(a)
any breach of, or inaccuracy in, any representation or warranty contained in Article IV of this Agreement or any certificate
delivered by Purchaser at the Closing (in each case as such representation or warranty would read if all qualifications as to
materiality and material adverse effect or similar qualifications were deleted therefrom for the purpose of determining whether
a breach thereof occurred and for determining the Losses for which the Indemnified Parties are entitled to indemnification hereunder);

 

(b)
any breach of any covenant or agreement of Purchaser contained in this Agreement, or any of the Transaction Documents; or

 

(c)
any claim for payment of fees and/or expenses of any broker or finder in connection with the origin, negotiation or execution
of this Agreement or the consummation of the transactions contemplated hereby based upon any agreement, arrangement or other understanding
between the claimant and Purchaser or any of its agents or representatives.

 

9.4
Procedure for Claims between Parties. If a claim for Losses is to be made by a Person entitled to indemnification hereunder
(an “Indemnified Party”), the Indemnified Party shall give written notice (a “Claim Notice”),
in the case of claims pursuant to Section 9.2, to the Sellers, and in the case of claims pursuant to Section 9.3,
to Purchaser (each Person so notified being referred to as the “Indemnifying Party”) as soon as practicable
after the Indemnified Party becomes aware of any fact, condition or event which may give rise to Losses for which indemnification
may be sought under this Article IX. Any failure to provide any such Claim Notice in a timely manner to the Indemnifying
Party shall not relieve the Indemnifying Party of any liability hereunder, except to the extent (and only to the extent) the Indemnifying
Party is actually prejudiced by such failure. Each Claim Notice shall set forth (i) the specific representation, warranty, covenant
or agreement alleged to have been breached, (ii) the nature and amount of the claim asserted, together with sufficient facts relating
thereto so that the Indemnifying Party may reasonably evaluate such claim and (iii) a calculation or good faith estimate, if such
can be reasonably calculated, of the aggregate Losses to which the Indemnified Party believes it is entitled in connection with
the claim. If the Indemnifying Party, within ten (10) Business Days after receipt of the Claim Notice, does not give written notice
to the Indemnified Party stating its intent to contest such claim, the claim shall be deemed accepted and the amount of the claim
shall be deemed a valid claim, and the Indemnifying Party shall, within ten (10) Business Days after expiration of the prior notice
period, deliver to the Indemnified Party the amount of the Losses with respect to the claim, unless such claim is contingent or
the amount not liquid, in which event the Indemnifying Party shall deliver such amount upon the Losses of such claim being determinable.
If the Indemnifying Party shall contest the assertion of a claim by giving such written notice to the Indemnified Party within
such period (a “Dispute Notice”), then the Parties shall act in good faith to reach agreement regarding such
claim.

 

    	35 

    	 

    

 

9.5
Defense of Third-Party Claims. If any action, suit or proceeding is filed or any claim is made against any Indemnified
Party by a third party, and such Indemnified Party may be entitled to indemnification under this Agreement with respect to such
claim, such Indemnified Party shall give written notice thereof to the Indemnifying Party as promptly as practicable. The failure
of any Indemnified Party to give timely notice hereunder shall not affect any rights to indemnification hereunder, except to the
extent (and only to the extent) that the Indemnifying Party is actually prejudiced by such failure. After such notice, the Indemnifying
Party shall be entitled, if it so elects and at its sole cost and expense (subject to the limitations set forth in this Article
IX), (a) to take control of the defense and investigation of such action, suit, proceeding or claim; provided,
however, that the Indemnifying Party must provide reasonable assurance to the Indemnified Party of the Indemnifying
Party’s financial capacity to defend such proceeding and provide indemnification with respect to such proceeding; and provided
further, if the Indemnifying Party is a Seller, such Indemnifying Party shall not have the right to defend or direct the defense
of any such Third Party Claim that (x) is asserted directly by or on behalf of a Person that is a supplier or customer of the
Business, or (y) seeks an injunction or other equitable relief against the Indemnified Party; (b) to employ and engage attorneys
of its own choice to handle and defend the same; provided, however, that the Indemnified Party may participate
in any action, suit, proceeding or claim with attorneys of its own choice and at its own expense; and provided, further,
that if the named parties to such action, suit, proceeding or claim include both the Indemnified Party and the Indemnifying Party,
and the Indemnified Party has been advised in writing by its counsel that there may be one or more legal defenses available to
such Indemnified Party that are different from or in addition to those available to the Indemnifying Party, or there exists a
conflict of interest between the Indemnifying Party and the Indemnified Party, the Indemnified Party shall be entitled, at the
Indemnifying Party’s expense (subject to the limitations set forth in this Article IX), to separate counsel of its
own choosing, and (c) to negotiate, compromise or settle such claim, which compromise or settlement shall be made only with the
prior written consent of the Indemnified Party, such consent not to be unreasonably withheld. The Indemnified Party shall cooperate
in a commercially reasonable manner with the Indemnifying Party and its attorneys in the investigation, trial and defense of such
action, suit, proceeding or claim and any appeal arising therefrom. In the case of Purchaser, such cooperation shall include the
retention, and the provision to the Sellers upon request, of records and information reasonably relevant to such third-party claim,
and making employees of Purchaser reasonably available on a mutually convenient basis to provide additional information and explanation
of any materials provided hereunder. The Parties shall cooperate with each other in any notifications to insurers. If the Indemnifying
Party fails to assume the defense of such claim within fifteen (15) calendar days after receipt of notice of the third-party action,
suit, proceeding or claim, the Indemnified Party against which such claim has been asserted will (upon delivering notice to such
effect to the Indemnifying Party) have the right to undertake, at the Indemnifying Party’s expense (subject to the limitations
set forth in this Article IX), the defense, compromise or settlement of such claim on behalf of the Indemnifying Party.
If the Indemnified Party assumes the defense of the claim, the Indemnified Party will keep the Indemnifying Party reasonably informed
of the progress of any such defense, compromise or settlement. The Indemnifying Party shall be liable (subject to the limitations
set forth in this Article IX) for any settlement of any action, suit, proceeding or claim effected pursuant to and in accordance
with this Section 9.5 and for any final judgment (subject to any right of appeal), and the Indemnifying Party shall indemnify
and hold harmless (subject to the limitations set forth in this Article IX an Indemnified Party from and against any Losses
by reason of such settlement or judgment.

 

    	36 

    	 

    

 

9.6
Omitted.

 

9.7
Limitation on Indemnification Obligations.

 

(a)
Notwithstanding anything to the contrary set forth in this Article IX or any other provision of this Agreement, the aggregate
liability of the Sellers and the Principals for Losses under Section 9.2(a) shall not exceed twenty percent (20%) of the
Base Purchase Price (the “Indemnity Cap”); provided, however that the above limitation shall not apply in the
case of Fraud or with respect to any Core Rep, Statutory Rep, or the representations set forth in Sections 3.5.

 

(b)
Notwithstanding anything to the contrary set forth in this Article IX or any other provision of this Agreement, the Sellers
and Principals shall not be liable for Losses under Section 9.2 unless and until the aggregate Losses for which the Sellers
and Principals would otherwise be liable exceed $15,000 (the “Basket Amount”), at which point the Sellers and
Principals shall become liable for Losses back to the first dollar; provided, however, that Losses relating to claims based on
Fraud shall not be subject to the Basket Amount.

 

(c)
Any Liability for indemnification hereunder shall be determined without duplication of recovery by reason of the state of facts
giving rise to such Liability constituting a breach of more than one representation, warranty, covenant or agreement; provided,
however, that the foregoing shall not prohibit an Indemnified Party from selecting the theory or right of indemnification
under which it may bring a claim.

 

9.8
Adjustments to Closing Purchase Price. All indemnification payments under this Article IX shall be deemed adjustments
to the portion of the Closing Purchase Price received by Sellers.

 

9.9
Right of Offset. If any indemnification claim brought by the Purchaser Indemnified Parties pursuant to Section 9.2
is not timely paid by the Sellers in accordance with Section 9.4, the Purchaser Indemnified Parties may, but shall not
be required to, offset any amount owing (even if not yet due) pursuant to the Seller Note by written notice to the Sellers. Following
the delivery of such notice, the principal amount owing pursuant to the Seller Note shall be automatically reduced by such amount.

 

9.10
Indemnification Exclusive Remedy. Following the Closing, except for Tax matters (which will be governed by Article VII)
or claims for Fraud, indemnification pursuant to the provisions of this Article IX shall be the exclusive remedy of the
Parties for any misrepresentation or breach of any warranty or covenant contained in or otherwise relating to the subject matter
of this Agreement (without limiting, and without any prejudice to, any right or remedy set forth in any other Transaction Document).
In furtherance of the foregoing, each party hereby waives, to the fullest extent permitted under Legal Requirements, any and all
rights, claims and causes of action for any breach of any representation, warranty, covenant, agreement or obligation set forth
herein or otherwise relating to the subject matter of this Agreement it may have against the other parties hereto and their Affiliates
arising under or based upon any Legal Requirements, except pursuant to the indemnification provisions set forth in this Article
IX. This Article IX shall not apply to Tax matters except to the extent provided in Article IX.

 

    	37 

    	 

    

 

Article
X

Termination,
Amendment and Waiver

 

10.1
Termination. This Agreement may be terminated at any time prior to the Closing Date:

 

(a)
by the mutual written consent of Purchaser and the Sellers;

 

(b)
by either Sellers (on the one hand) or Purchaser (on the other hand) if the Closing shall not have been consummated within sixty
(60) days of the date hereof for any reason; provided, however, that the right to terminate this Agreement
under this Section 10.1(b) shall not be available to (i) the Sellers if any action or failure to act by the Company or
Seller shall have been a principal cause of or resulted in the failure of the Closing to occur on or before such date and such
action or failure to act shall have constituted a material breach of this Agreement, or (ii) Purchaser if any action or failure
to act by a Purchaser shall have been a principal cause of or resulted in the failure of the Closing to occur on or before such
date and such action or failure to act shall have constituted a material breach of this Agreement;

 

(c)
by either the Sellers or Purchaser if a Governmental Authority shall have issued an Order or taken any other action, including,
without limitation, the failure or refusal of the Texas Public Utilities Commission to consent to or otherwise approve the consummation
of the transactions contemplated hereby, in any case having the effect of permanently restraining, enjoining or otherwise prohibiting
the Closing, which Order or other action is final and non-appealable;

 

(d)
by the Sellers, upon a breach of any representation, warranty, covenant or agreement on the part of Purchaser set forth in this
Agreement, or if any representation or warranty of Purchaser shall have become untrue, in either case such that the conditions
set forth in Section 8.1(a) or Section 8.1(b) would not be satisfied as of the time of such breach or as of the
time such representation or warranty shall have become untrue; provided, however, that if such breach
by Purchaser or such inaccuracy in the representations and warranties of Purchaser is curable by Purchaser, then the Sellers may
not terminate this Agreement under this Section 10.1(d) until thirty (30) days after delivery of written notice to Purchaser
of such breach and intent to terminate, provided Purchaser continue to exercise commercially reasonable efforts to cure such breach
(it being understood that the Sellers may not terminate this Agreement pursuant to this Section 10.1(d) if such breach
by Purchaser is cured during such thirty (30) day period, or if the Sellers shall have materially breached this Agreement);

 

(e)
by Purchaser in the event that Purchaser is not reasonably satisfied with or has not otherwise agreed in good faith with the Sellers
as to the final form of the Seller Disclosure Schedule within thirty (30) days following the Purchaser’s receipt thereof
pursuant to Section 2.6 above; or

 

(f)
by Purchaser, upon a breach of any representation, warranty, covenant or agreement on the part of any Seller set forth in this
Agreement, or if any representation or warranty of any Seller shall have become untrue, in either case such that the conditions
set forth in Section 8.2(a) or Section 8.2(b) would not be satisfied as of the time of such breach or as of the
time such representation or warranty shall have become untrue; provided, however, that if such breach
by such Seller or such inaccuracy in the representations and warranties of such Seller is curable by such Seller, then Purchaser
may not terminate this Agreement under this Section 10.1(e) until thirty (30) days after delivery of written notice to
the Sellers of such breach and intent to terminate, provided such Seller continue to exercise commercially reasonable efforts
to cure such breach (it being understood that Purchaser may not terminate this Agreement pursuant to this Section 10.1(e)
if such breach by such Seller is cured during such thirty (30) day period, or if Purchaser shall have materially breached this
Agreement).

 

    	38 

    	 

    

 

10.2
Notice of Termination; Effect of Termination. Any proper termination of this Agreement under Section 10.1 will be
effective immediately upon the delivery of written notice of termination by the terminating Party, in the case of Purchaser, to
the Sellers, and in the case of the Sellers, to Purchaser (it being understood that, in the case of any termination pursuant to
Section 10.1(d) or Section 10.1(e) based on any breach or inaccuracy which is curable, delivery of notice of intent
to terminate pursuant to Section 10.1(d) or Section 10.1(e) shall not be construed as notice of termination). In
the event of the termination of this Agreement as provided in Section 10.1, this Agreement shall be of no further force
or effect, except (a) as set forth in Section 10.1, this Section 10.2 and Sections 11.1 through 11.10,
each of which shall survive the termination of this Agreement, and (b) nothing herein shall relieve any Party from liability for
any breach of this Agreement.

 

10.3
Fees and Expenses. Except to the extent otherwise provided in this Agreement, all fees and expenses incurred in connection
with this Agreement and the transactions contemplated hereby shall be paid by the Party incurring such expenses whether or not
the transactions contemplated by this Agreement are consummated.

 

10.4
Amendment. Subject to applicable Legal Requirements, this Agreement may be amended by the Parties hereto at any time by
execution of an instrument in writing signed on behalf of Purchaser and the Sellers.

 

10.5
Waiver. Any Party hereto may, to the extent legally allowed, (a) extend the time for the performance of any of the obligations
of the other Parties hereto to such Party, (b) waive any inaccuracies in the representations and warranties made to such Party
contained herein or in any document delivered pursuant hereto, and (c) waive compliance with any of the agreements or conditions
for the benefit of such Party contained herein. Any agreement by a Party hereto to any such extension or waiver shall be valid
only if set forth in an instrument in writing signed by such Party. Delay in exercising any right under this Agreement shall not
constitute a waiver of such right.

 

Article
XI 

General
Provisions

 

11.1
Notices. All notices and other communications hereunder shall be in writing and shall be deemed given upon delivery either
personally or by commercial delivery service, or sent via facsimile (receipt confirmed) to the Parties at the following addresses
or facsimile numbers (or at such other address or facsimile numbers for a Party as such Party shall specify by like notice):

 

(a)
if to Purchaser (and the Company after the Closing), to:

 

Zen
Energy, Inc.

Attn:
Alex Rodriguez, Chairman and CEO

5851
Legacy Circle, Suite 600

Plano,
Texas 75024

Facsimile:

E-mail:

 

with
a copies to (which shall not constitute notice):

 

Pulman,
Cappuccio, Pullen, Benson & Jones, LLP

Attn:
J. Bradley Jones

2161
N.W. Military Hwy., Suite 400

San
Antonio, Texas 78213

Facsimile:
(210) 892-1610

E-mail:
bjones@pulmanlaw.com

 

    	39 

    	 

    

 

(b)
if to the Sellers or Principals:

 

Luccirelli
& Gomez, LLC

Attn:
Genaro Gomez Castanares

_______________________

Houston,
Texas __________

Facsimile:__________

E-mail:
ggcastanares@gmail.com

 

TCN
Holdings, LLC

Attn:
Donnie Goodwin

15
E. Loftwood Circle

Spring,
Texas 77382

Facsimile:__________

E-mail:
donnied68@hotmail.com

 

with
a copy to (which shall not constitute notice):

Chapoton
Sanders Scarborough, LLP

Attn:
J. Patrick LaRue

Two
Riverway, Suite 1500

Houston,
Texas 77056

Facsimile:
(713) 999-0025

E-mail:
plarue@css-firm.com

 

The
Law Office of John W. Wood, P.C.

4900 Woodway Drive, Suite 1110

Houston,
Texas 77056

Facsimile: 713-529-7378

Email:
jw@johnwoodlaw.com

 

11.2
Interpretation; Certain Defined Terms. When a reference is made in this Agreement to Exhibits, such reference shall be
to an Exhibit to this Agreement unless otherwise indicated. When a reference is made in this Agreement to Sections, such reference
shall be to a Section of this Agreement unless otherwise indicated. The words “include,” “includes” and
“including” when used herein shall be deemed in each case to be followed by the words “without limitation.”
The table of contents and headings contained in this Agreement are only for reference purposes and shall not affect in any way
the meaning or interpretation of this Agreement. The words “hereof,” “herein” and “hereunder”
and words of similar import when used in this Agreement shall refer to this Agreement as a whole and not to any particular provision
of this Agreement. All terms defined in this Agreement shall have the defined meanings when used in any certificate or other document
made or delivered pursuant hereto unless otherwise defined therein. The definitions contained in this Agreement are applicable
to the singular as well as the plural forms of such terms and to the masculine as well as to the feminine and neuter genders of
such term. Any agreement, instrument or statute defined or referred to herein or in any agreement or instrument that is referred
to herein means such agreement, instrument or statute as from time to time amended, modified or supplemented, including (in the
case of agreements or instruments) by waiver or consent and (in the case of statutes) by succession of comparable successor statutes
and references to all attachments thereto and instruments incorporated therein. References to a person are also to its permitted
successors and assigns. When reference is made herein to “the business of” an entity, such reference shall be deemed
to include the business of all direct and indirect Subsidiaries of such entity. Reference to the Subsidiaries of an entity shall
be deemed to include all direct and indirect Subsidiaries of such entity.

 

    	40 

    	 

    

 

11.3
Counterparts. This Agreement may be executed by facsimile of PDF signatures, in multiple counterparts, all of which shall
be considered one and the same agreement and shall become effective when one or more counterparts have been signed by each of
the Purchaser and Sellers and delivered to each of Purchaser and the Sellers, it being understood that all such Parties need not
sign the same counterpart.

 

11.4
Entire Agreement; Third-Party Beneficiaries. This Agreement, its Exhibits and the documents and instruments and other agreements
among the Parties hereto as contemplated by or referred to herein, including the Seller Disclosure Schedule, (a) constitute the
entire agreement among the Parties with respect to the subject matter hereof and supersede all prior agreements and understandings,
both written and oral, among the Parties with respect to the subject matter hereof and (b) except as expressly set forth in Section
6.6 and except for the rights and remedies of the Purchaser Indemnified Parties and the Seller Indemnified Parties set forth
in Article IX, are not intended to confer upon any other Person any rights or remedies hereunder.

 

11.5
Severability. In the event that any provision of this Agreement or the application thereof becomes or is declared by a
court of competent jurisdiction to be illegal, void or unenforceable, the remainder of this Agreement will continue in full force
and effect and the application of such provision to other Persons or circumstances will be interpreted so as reasonably to effect
the intent of the Parties hereto. The Parties further agree to replace such void or unenforceable provision of this Agreement
with a valid and enforceable provision that will achieve, to the extent possible, the economic, business and other purposes of
such void or unenforceable provision.

 

11.6
Governing Law; Submission to Jurisdiction. This Agreement shall be governed by and construed in accordance with the laws
of the State of Texas, regardless of the laws that might otherwise govern under applicable principles of conflicts of law thereof.
The Parties hereby irrevocably and unconditionally consent to submit to the exclusive jurisdiction of the state and federal courts
located in Harris County, Texas for any actions, suits or proceedings arising out of or relating to this Agreement and the transactions
contemplated hereby (and the Parties agree not to commence any action, suit or proceeding relating thereto except in such courts),
and further agree that service of any process, summons, notice or document by certified mail shall be effective service of process
for any action, suit or proceeding brought against the Parties in any such court. The Parties hereby irrevocably and unconditionally
waive any objection to the laying of venue of any action, suit or proceeding arising out of this Agreement in the state or federal
courts located in Harris County, Texas, and hereby further irrevocably and unconditionally waive and agree not to plead or claim
in any such court that any such action, suit or proceeding brought in any such court has been brought in an inconvenient forum.

 

11.7
No Specific Performance. The Sellers agree that notwithstanding any breach by Purchaser of this Agreement, none of the
Sellers or any of their respective Affiliates shall be entitled to specific performance of any covenants, agreements or other
provisions hereof or any other injunctive or other equitable relief hereunder.

 

11.8
Waiver of Jury Trial. EACH PARTY ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY WHICH MAY ARISE UNDER THIS AGREEMENT IS LIKELY
TO INVOLVE COMPLICATED AND DIFFICULT ISSUES, AND THEREFORE EACH OF THE PURCHASER AND SELLERS HEREBY IRREVOCABLY WAIVES ALL RIGHT
TO TRIAL BY JURY IN ANY ACTION, SUIT, PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT OR OTHERWISE) ARISING OUT OF
OR RELATING TO THIS AGREEMENT OR ANY OF THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT OR THE ACTIONS OF ANY OF THE PURCHASER
OR SELLERS IN THE NEGOTIATION, ADMINISTRATION, PERFORMANCE AND ENFORCEMENT HEREOF.

 

    	41 

    	 

    

 

11.9
Rules of Construction. The Parties agree that they have been represented by counsel during the negotiation and execution
of this Agreement and, therefore, waive the application of any Legal Requirement, holding or rule of construction providing that
ambiguities in an agreement or other document will be construed against the Party drafting such agreement or document.

 

11.10
Assignment. No Party may assign either this Agreement or any of its rights, interests, or obligations hereunder without
the prior written consent of Purchaser and the Sellers. Subject to this Section 11.10, this Agreement shall be binding
upon and shall inure to the benefit of the Parties hereto and their respective successors and permitted assigns. Any purported
assignment in violation of this Section 11.10 shall be void.

 

11.11
Attorney Client Privilege. All communications involving attorney-client confidences between the Seller, its Affiliates,
the Company and Chapoton Sanders Scarborough LLP and John Wood, Attorney-at-Law, in the course of the negotiation, documentation
and consummation of the transaction and Transaction Documents shall be deemed to be attorney-client confidences that belong solely
to the Sellers and its Affiliates (and not the Company). Accordingly, the Company shall not have access to any such communications,
or to the files of Chapoton Sanders Scarborough LLP or John Wood, Attorney-at-Law, relating to the engagement, whether or not
the Closing shall have occurred.

 

[SIGNATURE
PAGES FOLLOW]

 

    	42 

    	 

    

 

Execution
Copy

 

IN
WITNESS WHEREOF, each of the Purchaser and Sellers have caused this Equity Interest Purchase Agreement to be executed by their
respective duly authorized officers as of the date first written above.

 

	 	PURCHASER:
	 	 
	 	Zen
    Energy, Inc.
	 	 	 
	 	By:	/s/
    Alex Rodriguez
	 	Name:	Alex Rodriguez
	 	Title:	President &
    CEO
	 	 	 
	 	Sellers:
	 	 	 
	 	Luccirelli
    & Gomez, LLC
	 	 	 
	 	By:	/s/
    Genaro Gomez Castanares
	 	Name:	Genaro
Gomez Castanares
	 	Title:	President
	 	 	 
	 	TCN
    Holdings, LLC
	 	 	 
	 	By:	/s/
    Donnie Goodwin
	 	Name:	Donnie
    Goodwin
	 	Title:	Managing
    Partner

 

	 	Principals:
	 	 
	 	/s/
    Genaro Gomez Castanares
	 	Genaro
    Gomez Castanares
	 	 
	 	/s/
    Donnie Goodwin
	 	Donnie
    Goodwin

 

[SIGNATURE
PAGE TO EQUITY INTEREST PURCHASE AGREEMENT]

 

    	 	 	 

    	 	 	 

    

 

EXHIBIT
A

DEFINITIONS

 

“Accounting
Referee” has the meaning set forth in Section 7.1(c).

 

“Acquisition
Proposal” has the meaning set forth in Section 6.3(a).

 

“Adjustment
Amounts” has the meaning set forth in Section 2.4(b)(i)(C).

 

“Adjustment
Documents” has the meaning set forth in Section 2.4(d).

 

“Affiliate”
of a specified Person means each other Person who Controls, is Controlled by, or is under common Control with the specified Person.

 

“Agreement”
has the meaning set forth in the preamble to this Agreement.

 

“Amended
Company Agreement” has the meaning set forth in Section 1.5.

 

“Balance
Sheet” has the meaning set forth in Section 3.5(a).

 

“Balance
Sheet Date” has the meaning set forth in Section 3.5(a).

 

“Base
Purchase Price” has the meaning set forth in Section 2.3.

 

“Basket
Amount” has the meaning set forth in Section 9.7(b).

 

“Books
and Records” means all files, documents, instruments, papers, books and records relating to the business of the Company
or its Subsidiaries, including, without limitation, financial statements, Tax Returns and related work papers and letters from
accountants, budgets, pricing guidelines, ledgers, journals, deeds, title policies, minute books, stock certificates and books,
stock transfer ledgers, Contracts, licenses, customer lists, computer files and programs, retrieval programs, operating data and
plans, environmental studies and plans and payroll and benefits information pertaining to employees of the Company.

 

“Business”
has the meaning set forth in the Recitals.

 

“Business
Day” means any day except Saturday, Sunday or any other day on which commercial banks located in Dallas, Texas are authorized
or required by Law to be closed for business.

 

“Castanares”
has the meaning set forth in the preamble to this Agreement.

 

“Claim
Notice” has the meaning set forth in Section 9.4.

 

“Closing”
has the meaning set forth in Section 2.1.

 

“Closing
Date” has the meaning set forth in Section 2.1.

 

“Closing
Date Balance Sheet” has the meaning set forth in Section 2.4(b).

 

“Closing
Company Indebtedness Certificate” means a certificate executed by the Sellers, certifying the amount of (i) the Closing
Indebtedness as of the Closing and the amount, if any, paid or to be paid directly by Purchaser on behalf of the Company at the
Closing (including an itemized list of each such indebtedness amount and the creditor to whom such amount is owed).

 

    	A-1 

    	 

    

 

“Closing
Company Transaction Costs Certificate” means a certificate executed by the Sellers, certifying the amount of (i) the
Transaction Costs to be paid by the Company concurrent with or immediately prior to the Closing and (ii) the Company Transaction
Costs, if any, or to be paid directly by Purchaser on behalf of the Company at the Closing (including an itemized list of each
such unpaid Company Transaction Costs with a description of the nature of such expense and the Person to whom such expense is
owed).

 

“Closing
Purchase Price” has the meaning set forth in Section 2.3.

 

“Closing
Indebtedness” means the aggregate amount of the Company’s Indebtedness as of the Closing Date.

 

“Closing
Indebtedness Adjustment Amount” has the meaning set forth in Section 2.4(b)(i)(B).

 

“Closing
Transaction Costs Adjustment Amount” has the meaning set forth in Section 2.4(b)(i)(C).

 

“COBRA”
means the Consolidated Omnibus Reconciliation Act of 1985, as amended.

 

“Code”
means the Internal Revenue Code of 1986, as amended.

 

“Company”
has the meaning set forth in the Recitals.

 

“Company
Closing Certificates” has the meaning set forth in Section 2.7(a)(iv).

 

“Company
Contract” has the meaning set forth in Section 3.11(a).

 

“Company
Employees” means all those individuals that are employees of the Company as of the date of this Agreement (including
interns and part-time employees) and those individuals that become employees of the Company in the ordinary course of business
consistent with past practice between the date of this Agreement and immediately prior to the Closing Date. For purposes of this
Agreement, a “former” Company Employee is any individual who would have been a Company Employee but for the termination
of such individual’s employment with a Company, by a Company or otherwise, prior to the date hereof.

 

“Company
IP” means IP owned in whole or in part by the Company.

 

“Company
Material Adverse Effect” means any change, event, circumstance, development or effect that is, or would reasonably be
expected to be, individually or in the aggregate, materially adverse to the business, assets, financial condition, operations,
results of operations or prospects of the Company; provided, however, that “Company Material Adverse Effect”
shall not include any event, occurrence, fact, condition or change, directly or indirectly, arising out of or attributable to:
(i) general economic or political conditions; (ii) conditions generally affecting the industries in which the Company operates;
(iii) any changes in financial, banking or securities markets in general, including any disruption thereof and any decline in
the price of any security or any market index or any change in prevailing interest rates; (iv) acts of war (whether or not declared),
armed hostilities or terrorism, or the escalation or worsening thereof; (v) any action required or permitted by this Agreement
or any action taken (or omitted to be taken) with the written consent of or at the written request of Purchaser; (vi) any changes
in applicable Legal Requirements or accounting rules (including GAAP) or the enforcement, implementation or interpretation thereof;
(vii) the announcement, pendency or completion of the transactions contemplated by this Agreement, including losses or threatened
losses of employees, customers, suppliers, distributors or others having relationships with the Company; (viii) any natural or
man-made disaster or acts of God; or (ix) any failure by the Company to meet any internal or published projections, forecasts
or revenue or earnings predictions (provided that the underlying causes of such failures (subject to the other provisions of this
definition) shall not be excluded).

 

    	A-2 

    	 

    

 

“Company
Permits” has the meaning set forth in Section 3.13(b).

 

“Company
Secretary Certificate” has the meaning set forth in Section 2.7(a)(viii).

 

“Company
Transaction Costs” means the total amount of all fees, costs and expenses (including any attorney’s, accountant’s
(which shall not include regular audit fees), financial advisors, broker’s or finder’s fees) incurred by the Company,
the Sellers or for the benefit of the Company on or prior to the Closing that remain unpaid as of the Closing Date, in connection
with (a) any due diligence conducted by the Company with respect to the transactions contemplated by this Agreement, (b) the negotiation,
preparation and review of this Agreement (including the Seller Disclosure Schedule) and all related agreements and opinions delivered
or to be delivered in connection with the transactions contemplated by this Agreement, (c) the preparation and submission of any
filing or notice required to be made or given in connection with any of the transactions contemplated by this Agreement, (d) the
obtaining of any Consent required to be obtained in connection with any transactions contemplated hereby, (e) any change of control
payments, transaction bonus payments and stay bonus obligations (and all other Liabilities, obligations, costs and expenses related
to such payments or obligations, including any Taxes related thereto), if any, and (f) otherwise in connection with the transactions
contemplated hereby.

 

“Company
Transaction Costs Schedule” has the meaning set forth in Section 2.4(b)(i).

 

“Contract”
means, with respect to any Person, any contract, agreement, instrument, license, lease, mortgage, note, bond, debenture, indenture,
guarantee, franchise, concession, plan, warranty, purchase order, insurance policy, or other legally binding obligation, arrangement
or other commitment to which such Person is a party or by which such Person or such Person’s properties or assets are bound.

 

“Control,”
“Controlled” and “Controlling” means possession, directly or indirectly, of the power to
direct or cause the direction of the management or policies of a Person, whether through ownership of securities, by contract
or otherwise.

 

“Core
Reps” has the meaning set forth in Section 9.1.

 

“Current
Assets” means any current assets of the Company as of the close of business on the Closing Date of the type required
to be set forth on a balance sheet prepared in accordance with GAAP, consistently applied, including, without limitation, accounts
receivable, inventory, marketable securities, prepaid expenses and other liquid assets that can be readily converted to cash,
all of which are to be reflected on the Closing Date Balance Sheet (and any estimates thereof) (but excludes cash and cash equivalents).

 

“Current
Liabilities” means any current Liabilities and obligations of the Company as of the close of business on the Closing
Date of the type required to be set forth on a balance sheet prepared in accordance with GAAP, consistently applied including,
without limitation, (i) any Liabilities and obligations of the Company that are required to be accrued pursuant to the terms of
this Agreement, and (ii) Liabilities contingent upon the consummation of, or arising in connection with, the transactions contemplated
by this Agreement and incurred on or prior to the anticipated Closing, all of which are to be reflected on the Closing Date Balance
Sheet (and any estimates thereof). Notwithstanding the foregoing, “Current Liabilities” does not mean and shall not
include (x) the Company Transaction Costs or (y) the current portion of any Indebtedness to the extent included in the Closing
Indebtedness or (z) intercompany or Seller loans or payables.

 

    	A-3 

    	 

    

 

“Dispute
Notice” has the meaning set forth in Section 9.4.

 

“Encumbrances”
means restrictions on title or transfer, including liens, charges, security interests, options, claims, mortgages, pledges, proxies,
voting trusts or agreements, or similar obligations or encumbrances of any kind.

 

“Enforceability
Limitations” has the meaning set forth in Section 3.2(a).

 

“Environmental
and Safety Requirements” means all federal, state, local and foreign statutes, regulations, ordinances and other provisions
having the force or effect of law, all judicial and administrative orders and determinations, all contractual obligations and
all common law, in each case concerning public health and safety, worker health and safety, exposure to hazardous substances or
materials, pollution or protection of the environment, including all those relating to the presence, use, production, generation,
handling, transport, treatment, storage, disposal, distribution, labeling, testing, processing, discharge, release, threatened
release, control or cleanup of, or exposure to, any hazardous or otherwise regulated materials, substances or wastes, chemical
substances or mixtures, pesticides, pollutants, contaminants, toxic chemicals, petroleum products or byproducts, asbestos, polychlorinated
biphenyls, noise, radiation or radon, each as amended and as now or hereafter in effect.

 

“ERISA”
means the Employee Retirement Income Security Act of 1974, as amended.

 

“ERISA
Affiliate” means all employers (whether or not incorporated) that would be treated together with the Company or any
of its Affiliates as a “single employer” within the meaning of Section 414 of the Code.

 

“Estimated
Adjustments” has the meaning set forth in Section 2.3(a)(i).

 

“Estimated
Adjustment Amounts” has the meaning set forth in Section 2.4(a)(ii).

 

“Estimated
Adjustment Documents” has the meaning set forth in Section 2.4(a).

 

“Estimated
Closing Purchase Price” has the meaning set forth in Section 2.4(a).

 

“Estimated
Closing Date Balance Sheet” has the meaning set forth in Section 2.4(a).

 

“Estimated
Closing Indebtedness” means the amount of the estimated Closing Indebtedness, as set forth in the Estimated Closing
Indebtedness Schedule.

 

“Estimated
Closing Indebtedness Adjustment Amount” has the meaning set forth in Section 2.4(a)(ii).

 

“Estimated
Company Transaction Costs” means the amount of the estimated Company Transaction Costs, as set forth in the Estimated
Company Transaction Costs Schedule.

 

    	A-4 

    	 

    

 

“Estimated
Closing Indebtedness Adjustment Amount” has the meaning set forth in Section 2.4(a)(iii).

 

“Estimated
Company Transaction Costs Schedule” has the meaning set forth in Section 2.4(a).

 

“Estimated
Indebtedness Schedule” has the meaning set forth in Section 2.4(a).

 

“Estimated
Transaction Costs Adjustment Amount” has the meaning set forth in Section 2.4(a)(iii).

 

“Estimated
Working Capital” means the amount (positive or negative) equal to (i) estimated Current Assets minus (ii) estimated
Current Liabilities, each as set forth in the Estimated Working Capital Schedule.

 

“Estimated
Working Capital Adjustment Amount” has the meaning set forth in Section 2.4(a)(i).

 

“Estimated
Working Capital Schedule” has the meaning set forth in Section 2.4(a).

 

“Final
Closing Indebtedness” has the meaning set forth in Section 2.4(b)(i).

 

“Final
Company Transaction Costs” has the meaning set forth in Section 2.4(b)(i).

 

“Final
Working Capital” has the meaning set forth in Section 2.4(b)(i).

 

“Financial
Statements” has the meaning set forth in Section 3.5(a).

 

“Fraud”
means, with respect to a Person, an actual and intentional fraud with respect to the making of the representations and warranties
pursuant to Article III and Article IV (as applicable), provided, that such actual and intentional fraud
of such Person shall only be deemed to exist if any of the individuals included in the definition of “knowledge of the Purchaser”
or “Knowledge of the Company” included in this Agreement had actual knowledge (as opposed to implied or constructive
knowledge) that the representations and warranties made by such Person pursuant to, in the case of the Sellers, Article III,
as qualified by the Seller Disclosure Schedule, or, in the case the Purchaser, Article IV, were actually breached when
made, with express intention that the other party rely thereon to its detriment.

 

“GAAP”
means U.S. generally accepted accounting principles (as set forth in the opinions and pronouncements of the Accounting Principles
Board of the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting
Standards Board or agencies with similar functions of comparable status and authority within the U.S. accounting profession, applicable
to the circumstances).

 

“Goodwin”
has the meaning set forth in the preamble to this Agreement.

 

“Governmental
Authority” means any: (i) principality, state, commonwealth, province, territory, county, municipality, district or
other jurisdiction of any nature; (ii) federal, state, local, municipal or other government; (iii) governmental or quasi-governmental
authority of any nature (including any governmental division, subdivision, department, agency, bureau, branch, office, commission,
council, board, instrumentality, officer, official, representative, organization, unit, or body and any court or other tribunal,
or the Company, corporation, organization, or any other instrumentality that is owned or controlled by any Governmental Authority);
or (iv) Person or body exercising, or entitled to exercise, any governmental executive, legislative, judicial, administrative,
regulatory, audit, investigative, police, military or taxing authority or power on behalf of the above noted entities.

 

    	A-5 

    	 

    

 

“GSE”
has the meaning set forth in Section 1.3(a).

 

“GSE
Services Agreement” has the meaning set forth in Section 1.3(b).

 

“GSE
Subscription Agreement” has the meaning set forth in Section 1.3(b).

 

“Immediate
Family” means any spouse, parent, child, grandchild, sibling, mother and father-in-law, son and daughter-in-law, brother
and sister-in-law, niece, nephew and anyone (other than domestic employees) sharing the same home.

 

“Indebtedness”
means, with respect to any Person (and except for accounts payable and accrued liabilities incurred in the ordinary course of
business and not overdue for more than sixty (60) days which are expressly excluded from this definition):

 

(i)
all Liabilities, including principal, interest, fees, premiums, prepayment penalties, breakage amounts, expense reimbursements
or other amounts payable in connection therewith, for borrowed money;

 

(ii)
all Liabilities for the deferred purchase price of property or services;

 

(iii)
all Liabilities that are evidenced by a note, bond, debenture or similar instrument;

 

(iv)
all Liabilities, contingent or otherwise, in respect of letters of credit, letters of guaranty or bankers’ acceptances,
if drawn;

 

(v)
all Liabilities under financing and capital leases;

 

(vi)
all Liabilities payable upon termination of interest rate protection agreements, foreign currency exchange agreements or other
interest rate or exchange rate hedging or swap arrangements;

 

(vii)
all Liabilities, contingent or otherwise, which in accordance with GAAP would be required to be presented upon such Person’s
balance sheet as Liabilities other than Current Liabilities;

 

(viii)
all other Liabilities, contingent or otherwise, which would not be required by GAAP to be presented upon such Person’s balance
sheet as Liabilities, but of which such Person has Knowledge; and

 

(ix)
all guarantees of any of the obligations and liabilities described in clauses (i) through (viii) above.

 

“Indebtedness
Schedule” has the meaning set forth in Section 2.4(b)(i).

 

“Indemnified
Party” has the meaning set forth in Section 9.4.

 

“Indemnifying
Party” has the meaning set forth in Section 9.4.

 

    	A-6 

    	 

    

 

“Indemnity
Cap” has the meaning set forth in Section 9.7(a).

 

“Independent
Accounting Firm” has the meaning set forth in Section 2.4(e).

 

“Insurance
Policies” has the meaning set forth in Section 3.22(a).

 

“Intellectual
Property Rights” means any and all of the following statutory and common law rights throughout the world in, arising
out of, or associated therewith: (i) all patents, utility models, statutory invention registrations, and applications therefor
and all reissues, reexaminations, divisionals, extensions, provisionals, continuations and continuations-in-part thereof; (ii)
all inventions (whether patentable or not), invention disclosures, discoveries, improvements, trade secrets, proprietary information,
know-how and technology; (iii) all works of authorship, copyrights and copyright registrations and applications therefor, mask
works, and any moral rights associated therewith; (iv) all industrial designs and registered designs and any registrations and
applications therefor; (v) all trade names, logos, trademarks, service marks, and registrations and applications therefor; (vi)
all databases and data collections (including knowledge databases, customer and supplier lists and customer and supplier databases);
(vii) all rights in computer hardware, firmware, and software, including but not limited to source code, object code, and executable
code and any associated documentation; (viii) rights to Uniform Resource Locators, Web site addresses and domain names; (ix) any
similar, corresponding or equivalent rights to any of the foregoing or in any Technology; and (x) any goodwill associated with
any of the foregoing.

 

“IP”
means Intellectual Property Rights and Technology.

 

“IRS”
means the Internal Revenue Service.

 

“IT
Systems” means the hardware, software, data, databases, data communication lines, network and telecommunications equipment,
Internet-related information technology infrastructure, wide area network and other information technology equipment, owned, leased
or licensed by the Company.

 

“Knowledge
of the Company” means with respect to a particular fact or matter: the actual knowledge of such fact or matter by any
Seller.

 

“L&G”
has the meaning set forth in the preamble to this Agreement.

 

“Legal
Requirement” means any federal, state, local, municipal, provincial, foreign, international or other law, statute, constitution,
treaty, principle of common law, resolution, ordinance, code, edict, decree, rule, regulation, ruling or requirement issued, enacted,
adopted, promulgated, implemented or otherwise put into effect by or under the authority of any Governmental Authority.

 

“Liability”
means any liability, debt obligation, deficiency, Tax, penalty, fine, claim, cause of action or other loss, cost or expense of
any kind or nature whatsoever, whether asserted or unasserted, absolute or contingent, known or unknown, accrued or unaccrued,
liquidated or unliquidated, and whether due or to become due and regardless of when asserted.

 

“Losses”
means any and all demands, claims, actions or causes of action, assessments, costs, disbursements, losses, diminution in value,
Liabilities, obligations, fines, charges, penalties, awards, damages and expenses (including expenses and reasonable attorneys’
fees incurred in the investigation or defense of any of the same or in asserting rights hereunder), arising directly and reasonably
as a consequence of such matter but shall not include any special, incidental, consequential, multiple of earnings, indirect,
punitive or similar, including declines in value, lost opportunities, lost profits, business interruption or lost reputation except
to the extent arising from a Third Party Claim.

 

    	A-7 

    	 

    

 

“Luminant”
has the meaning set forth in Section 1.3(b).

 

“Luminant
Contract” has the meaning set forth in Section 1.3(b).

 

“Material
Contract” means any Contract that is disclosed or required to be disclosed in Section 3.11(a) of the Seller Disclosure
Schedule.

 

“Membership
Interest Assignment” has the meaning set forth in Section 2.7(a)(iii).

 

“New
Equity Interests” has the meaning set forth in Section 1.3(a).

 

“Objection
Notice” has the meaning set forth in Section 2.4(d).

 

“Order”
means any decision, judgment, order, writ, injunction, decree, award or determination (whether temporary, preliminary or permanent)
of any Governmental Authority.

 

“Organizational
Documents” means (a) the articles or certificate of incorporation and the bylaws of a corporation; (b) the certificate
of organization or formation and company agreement of a limited liability company; (c) the limited partnership agreement and the
certificate of limited partnership of a limited partnership; (d) any charter or similar document adopted or filed in connection
with the creation, formation, or organization of a Person; and (e) any amendment to any of the foregoing.

 

“Outstanding
Equity Interests” has the meaning set forth in the Recitals.

 

“Parties”
has the meaning set forth in the introductory paragraph hereof.

 

“Payoff
Letters” has the meaning set forth in Section 6.6.

 

“Permitted
Encumbrances” means (i) statutory liens for Taxes or other governmental charges or assessments or levies not yet due
and payable, (ii) liens of landlords, carriers, warehousemen, mechanics, vendors or materialmen securing obligations arising in
the ordinary course of business that are not yet due and payable and which are not, individually or in the aggregate, material
to the business of the Company, and (iii) easements, rights of way, zoning ordinances and other similar encumbrances affecting
Real Property which are not, individually or in the aggregate, material to the business of the Company.

 

“Person”
means any individual, corporation (including any non-profit corporation), general partnership, limited partnership, limited liability
partnership, joint venture, estate, trust, company (including any limited liability company or joint stock company), firm or other
enterprise, association, organization, entity or Governmental Authority.

 

“Plans”
has the meaning set forth in Section 3.14(a).

 

“Post-Closing
Tax Period” means any taxable period beginning after the Closing Date and, with respect to any taxable period beginning
before and ending after the Closing Date, the portion of such taxable period beginning after the Closing Date.

 

“Pre-Closing
Tax Period” means any taxable period ending on or before the Closing Date and, with respect to any taxable period beginning
before and ending after the Closing Date, the portion of such taxable period ending on and including the Closing Date.

 

    	A-8 

    	 

    

 

“Pre-Closing
Taxes” means Taxes of the Company for any Pre-Closing Tax Period.

 

“Principals”
has the meaning set forth in the preamble to this Agreement.

 

“Purchased
Equity Interests” has the meaning set forth in the Recitals.

 

“Purchaser”
has the meaning set forth in the preamble to this Agreement.

 

“Purchaser
Closing Certificates” has the meaning set forth in Section 2.7(b)(v).

 

“Purchaser
Disclosure Schedule” has the meaning set forth in the preamble to Article IV.

 

“Purchaser
Indemnified Parties” has the meaning set forth in Section 9.2.

 

“Real
Property” means the real property owned, leased or subleased by the Company, together with all buildings, structures
or facilities located thereon.

 

“Registered
Intellectual Property Rights” means all United States and foreign: (i) patents, utility model registrations, statutory
invention registrations, registered industrial designs, and applications therefor and all reissues, reexaminations, divisionals,
extensions, provisionals, continuations and continuations-in-part thereof, and international equivalents thereof; (ii) registered
trademarks and service marks, applications to register trademarks and service marks, including actual use and intent-to-use applications,
and other registrations or applications related to trademarks or service marks; (iii) registered copyrights and applications for
copyright registration; and (iv) domain name registrations.

 

“Related
Party Debt” has the meaning set forth in Section 3.20(a).

 

“Relevant
Person” has the meaning set forth in Section 3.29(a).

 

“Representative”
means, with respect to any Person, any of such Person’s employees, officers, directors, managers, shareholders, members
or other owners, trustees, trust beneficiaries, agents, consultants or other representatives (including any investment bankers).

 

“Seller
Disclosure Schedule” has the meaning set forth in the preamble to Article III.

 

“Seller
Indemnified Parties” has the meaning set forth in Section 9.3.

 

“Seller
Note” has the meaning set forth in Section 2.3(b).

 

“Seller
Note Amount” has the meaning set forth in Section 2.4(c).

 

“Sellers”
has the meaning set forth in the preamble to this Agreement.

 

“Sellers
Services Agreement” has the meaning set forth in Section 1.4.

 

“Statutory
Reps” has the meaning set forth in Section 9.1.

 

“Straddle
Period” has the meaning set forth in Section 7.3.

 

“Subsidiary”
of a specified entity means any corporation, partnership, limited liability company, joint stock company, joint venture or other
legal entity of which the specified entity (either alone or through or together with any other Subsidiary) owns, directly or indirectly,
fifty percent (50%) or more of the stock or other equity, partnership or other ownership interests the holders of which are generally
entitled to vote for the election of the board of directors or other governing body of such corporation or other legal entity.

 

    	A-9 

    	 

    

 

“Tangible
Assets” has the meaning set forth in Section 3.10.

 

“Target
Working Capital” means an amount equal to $0.00.

 

“Tax”
or “Taxes” (and, with correlative meaning, “Taxable” and “Taxation”)
means any federal, state, local or foreign income, gross receipts, license, payroll, employment, excise, severance, stamp, occupation,
premium, windfall profits, environmental (including taxes under Section 59A of the Code), customs duties, capital stock, franchise,
profits, withholding, social security (or similar), unemployment, disability, real property, personal property, sales, use, transfer,
registration, value added, alternative or add-on minimum, estimated, state nonresident withholding, unclaimed and abandoned property
or other tax of any kind whatsoever, including any interest, penalty, or addition thereto, whether disputed or not.

 

“Tax
Claim” has the meaning set forth in Section 7.4.

 

“Tax
Return” means any return, declaration, report, claim for refund, or information return or statement relating to Taxes
(including federal, state, local and foreign Tax returns), including any such document prepared on a consolidated, combined or
unitary basis and also including any schedule or attachment thereto, and including any amendment thereof.

 

“TCN”
has the meaning set forth in the preamble to this Agreement.

 

“Technology”
means all technology of any kind, including but not limited to all know-how, show-how, methods, apparatus, compositions of matter,
machines, techniques, designs, diagrams, design rules, formulas, trade secrets, ideas, discoveries, inventions (whether or not
patented or patentable), business materials, algorithms, routines, computer hardware, firmware, and software (including but not
limited to source code, object code, and executable code and any associated documentation), flowcharts, files, databases, spreadsheets,
works of authorship (whether or not copyrightable), processes, test methodologies, any media on which any of the foregoing is
recorded, any other tangible embodiments of any of the foregoing and all devices, prototypes, hardware, equipment, development
tools and test systems, but not the Intellectual Property Rights in any of the foregoing.

 

“Third-Party
Claim” means any claim or proceeding that is asserted or threatened by a Person other than the Parties, their successors
and permitted assigns, against any Indemnified Party or to which any Indemnified Party is subject.

 

“Transaction
Documents” means the Seller Note, the GSE Subscription Agreement, the GSE Services Agreement, the Sellers Services Agreement,
the Amended Company Agreement, the Membership Interest Assignment, and the other agreements, instruments and documents required
to be delivered prior to or at the Closing.

 

“Treasury
Regulations” means regulations promulgated by the Secretary of the Treasury or a delegate of the Secretary of the Treasury,
as amended from time to time.

 

“WARN
Act” means the federal Worker Adjustment and Retraining Notification Act of 1988, and similar state, local and foreign
laws related to plant closings, relocations, mass layoffs and employment losses.

 

“Working
Capital” means the amount (positive or negative) equal to (i) Current Assets minus (ii) Current Liabilities,
each as set forth in the Working Capital Schedule. Working Capital shall not include any Company Transaction Costs included as
Current Liabilities.

 

“Working
Capital Adjustment Amount” has the meaning set forth in Section 2.4(b)(i)(A).

 

“Working
Capital Schedule” has the meaning set forth in Section 2.4(b)(i).

 

    	A-10SECURITIES
PURCHASE AGREEMENT

 

This
Securities Purchase Agreement (this “Agreement”) is dated as of March 17, 2017, between The Chron Organization,
Inc., Inc. a Nevada corporation (the “Company”), and the purchaser identified on the signature pages hereto (including
its successors and assigns, the “Purchaser”).

 

WHEREAS,
subject to the terms and conditions set forth in this Agreement and pursuant to Section 4(2) of the Securities Act of 1933, as
amended (the “Securities Act”), and Rule 506 promulgated thereunder, the Company desires to issue and sell to
the Purchaser, and the Purchaser desires to purchase from the Company, securities of the Company as more fully described in this
Agreement.

 

NOW,
THEREFORE, IN CONSIDERATION of the mutual covenants contained in this Agreement, and for other good and valuable consideration,
the receipt and adequacy of which are hereby acknowledged, the Company and each Purchaser agree as follows:

 

ARTICLE
I.

DEFINITIONS

 

1.1.
Definitions. In addition to the terms defined elsewhere in this Agreement: (a) capitalized terms that are not otherwise
defined herein have the meanings given to such terms in the Debentures (as defined herein), and (b) the following terms have the
meanings set forth in this Section 1.1:

 

“Acquiring
Person” shall have the meaning ascribed to such term in Section 4.7.

 

“Action”
shall have the meaning ascribed to such term in Section 3.1(j).

 

“Affiliate”
means any Person that, directly or indirectly through one or more intermediary, controls or is controlled by or is under common
control with a Person, as such terms are used in and construed under Rule 405 under the Securities Act.

 

“Board
of Directors” means the board of directors of the Company.

 

“Business
Day” means any day except Saturday, Sunday, any day which is a federal legal holiday in the United States or any day
on which banking institutions in the State of New York are authorized or required by law or other governmental action to close.

 

“Closing”
means the closing of the purchase and sale of the Debentures pursuant to Section 2.1.

 

“Closing
Date” means the Trading Day when all of the Transaction Documents have been executed and delivered by the applicable
parties thereto, and all conditions precedent to (i) the Purchaser’s obligations to pay the Subscription Amount and (ii)
the Company’s obligations to deliver the Debentures have been satisfied or waived.

 

“Closing
Statement” means the Closing Statement in the form Annex A attached hereto.

 

“Commission”
means the United States Securities and Exchange Commission.

 

“Common
Stock” means the common stock of the Company, par value$.001 per share, and any other class of securities into which
such securities may hereafter be reclassified or changed into.

 

    	 		 

    	 

    

 

“Common
Stock Equivalents” means any securities of the Company or the Subsidiaries which would entitle the holder thereof to
acquire at any time Common Stock, including, without limitation, any debt, preferred stock, rights, options, warrants or other
instrument that is at any time convertible into or exercisable or exchangeable for, or otherwise entitles the holder thereof to
receive Common Stock.

 

“Conversion
Price” shall have the meaning ascribed to such term in the Debentures.

 

“Debentures”
means the Original Issue Discount Convertible Debentures due, subject to the terms therein, twelve months from the Closing Date,
issued by the Company to the Purchaser hereunder, in the form of Exhibit A attached hereto.

 

“Disclosure
Schedules” shall have the meaning ascribed to such term in Section 3.1.

 

“Exchange
Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.

 

“Exempt
Issuance” means the issuance of (a) up to 40,000,000 shares of Common Stock or options to employees, officers, directors
or consultants of the Company pursuant to any stock or option plan or agreement duly adopted for such purpose by the Board of
Directors or a majority of the members of a committee of non-employee directors established for such purpose, (b) securities upon
the exercise, exchange or conversion of any Debentures or Warrants issued hereunder and/or other securities, options, warrants,
convertible securities or other rights to acquire, exercisable or exchangeable for or convertible into, shares of Common Stock,
in each case that are issued and outstanding on the date of this Agreement, provided that such securities have not been amended
since the date of this Agreement to increase the number of such securities or to decrease the exercise, exchange or conversion
price of such securities, (c) securities issued pursuant to acquisitions of companies, assets or intellectual property (or licensing
of assets or intellectual property) or strategic transactions approved by a majority of the disinterested directors of the Company,
if any, provided that any such issuance shall only be to a Person which is, itself or through its subsidiaries, an operating company,
a university or other nonfinancial institution and in which the Company receives benefits in addition to the investment of funds,
(d) securities issued in connection with real property leasing arrangement or debt financing from a bank or similar financial
institution approved by the Company’s Board of Directors, provided that the primary purpose of such transaction is not for
the purpose of raising capital and/or the securities issued or issuable in such transaction are not issued or issuable to an entity
whose primary business is investing in securities (e) shares issued or issuable where the holders of a majority of the outstanding
notes waive their anti-dilution rights pursuant to any agreements entered into after the Company has securities registered under
the Exchange Act and is required to file reports under the Exchange Act. Such transaction is not for the purpose of raising capital
and/or the securities issued or issuable in such transaction are not to an entity whose primary business is investing in securities.

 

“GAAP”
shall have the meaning ascribed to such term in Section 3.1(h).

 

“Indebtedness”
shall have the meaning ascribed to such term in Section 3.1(gg).

 

“Intellectual
Property Rights” shall have the meaning ascribed to such term in Section 3.1(o).

 

“Legend
Removal Date” shall have the meaning ascribed to such term in Section 4.1(c).

 

“Liens”
means a lien, charge, security interest, encumbrance, right of first refusal, preemptive right or other restriction.

 

    	 		 

    	 

    

 

“Material
Adverse Effect” shall have the meaning assigned to such term in Section 3.1(b).

 

“Material
Permits” shall have the meaning ascribed to such term in Section 3.1(m).

 

“Maximum
Rate” shall have the meaning ascribed to such term in Section 5.17.

 

“Person”
means an individual or corporation, partnership, trust, incorporated or unincorporated association, joint venture, limited liability
company, joint stock company, government (or an agency or subdivision thereof) or other entity of any kind.

 

“Proceeding”
means an action, claim, suit, investigation or proceeding (including, without limitation, an informal investigation or partial
proceeding, such as a deposition), whether commenced or threatened.

 

“Purchaser
Party” shall have the meaning ascribed to such term in Section 4.10.

 

“Required
Approvals” shall have the meaning ascribed to such term in Section 3.1(e).

 

“Required
Minimum” means, as of any date, the maximum aggregate number of shares of Common Stock then issued or potentially issuable
in the future pursuant to the Transaction Documents, including any Underlying Shares issuable upon conversion in full of the Debentures
(including Underlying Shares issuable as payment of interest on the Debentures) and the shares issuable upon exercise of the Warrants
ignoring any conversion or exercise limits set forth therein multiplied by three.

 

“Rule
144” means Rule 144 promulgated by the Commission pursuant to the Securities Act, as such Rule may be amended from time
to time, or any similar rule or regulation hereafter adopted by the Commission having substantially the same effect as such Rule.

 

“SEC
Reports” shall have the meaning ascribed to such term in Section 3.1(h).

 

“Securities”
means the Debentures, the Underlying Shares, the Warrant and the Common Stock issuable or issuable upon exercise of the Warrants.

 

“Securities
Act” means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.

 

“Short
Sales” means all “short sales” as defined in Rule 200 of Regulation SHO under the Exchange Act (but shall not
be deemed to include the location and/or reservation of borrowable shares of Common Stock).

 

“Subscription
Amount” means the aggregate amount to be paid for the Debentures purchased hereunder as specified below the Purchaser’s
name on the signature page of this Agreement and next to the heading “Subscription Amount,” in United States dollars
and in immediately available funds.

 

“Subsidiary”
means with respect to any entity at any date, any direct or indirect corporation, limited or general partnership, limited liability
company, trust, estate, association, joint venture or other business entity of which (A) more than 30% of (i) the outstanding
capital stock having (in the absence of contingencies) ordinary voting power to elect a majority of the board of directors or
other managing body of such entity, (ii) in the case of a partnership or limited liability company, the interest in the capital
or profits of such partnership or limited liability company or (iii) in the case of a trust, estate, association, joint venture
or other entity, the beneficial interest in such trust, estate, association or other entity business is, at the time of determination,
owned or controlled directly or indirectly through one or more intermediaries, by such entity, or (B) is under the actual control
of the Company.

 

    	 		 

    	 

    

 

“Trading
Day” means a day on which the principal Trading Market is open for trading.

 

“Trading
Market” means the following markets or exchanges on which the Common Stock is listed or quoted for trading on the date
in question: the NYSE MKT, LLC, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market, the New
York Stock Exchange, the OTCQB or OTCPink maintained by the OTC Markets Group, Inc.

 

“Transaction
Documents” means this Agreement, the Debentures, all exhibits and schedules thereto and hereto and any other documents
or agreements executed in connection with the transactions contemplated hereunder.

 

“Transfer
Agent” means Securities Transfer Corporation and a telephone number of (469) 633-0101 and any successor transfer agent
of the Company.

 

“Underlying
Shares” means the shares of Common Stock (i) issued and issuable upon conversion or redemption of the Debentures and
issued and issuable in lieu of the cash payment of interest on the Debentures in accordance with the terms of the Debentures and
(ii) issued and issuable upon exercise of the Warrant.

 

“VWAP”
means, for any date, the price determined by the first of the following clauses that applies: (a) if the Common Stock is then
listed or quoted on a Trading Market, the daily volume weighted average price of the Common Stock for such date (or the nearest
preceding date) on the Trading Market on which the Common Stock is then listed or quoted as reported by Bloomberg L.P. (based
on a Trading Day from 9:30 a.m. New York City time to 4:02 p.m. New York City time); (b) if the Common Stock is is quoted on the
OTCPink, the most recent bid price per share of the Common Stock for such date (or the nearest preceding date) on the OTCPink
as then listed or quoted for trading by OTC Markets Group, Inc. (or a similar organization or agency succeeding to its functions
of reporting prices), or (c) in all other cases, the fair market value of a share of Common Stock as determined by an independent
appraiser selected in good faith by the Purchaser and reasonably acceptable to the Company, the fees and expenses of which shall
be paid by the Company.

 

ARTICLE
II.

PURCHASE
AND SALE

 

2.1
Closing. On the Closing Date, upon the terms and subject to the conditions set forth herein, substantially concurrent with
the execution and delivery of this Agreement by the parties hereto, the Company agrees to sell, and the Purchaser agrees to purchase,
for a purchase price of an aggregate of $165,000 in principal amount of the Notes. The Notes will be funded as follows:

 

	Funding Schedule	 	Amount of Note	 	 	Purchase Price (10% Original Issue Discount)	 
	On the date of this Agreement	 	$	82,500	 	 	$	75,000	*
	(i)Provided there has not been a Material Adverse Effect and

                                 (ii) provided the Company is not in breach of this Agreement or the Debenture within five Trading Days of the date the Form 10 filed by the Company.
	 	$	82,500	 	 	$	75,000	 

 

*Does
not reflect $10,000 payable by the Company for Purchaser’s legal fees.

 

    	 		 

    	 

    

 

The
Purchaser shall deliver to the Company, via wire transfer, immediately available funds equal to its Subscription Amount and the
Company shall deliver to the Purchaser its Note, as set forth in Section 2.2, and the Company and the Purchaser shall deliver
the other items set forth in Section 2.2 deliverable at the Closing. Upon satisfaction of the conditions set forth in Sections
2.2 and 2.3, the initial Closing shall occur at the offices of Sichenzia Ross Ference Kesner LLP or such other location as the
parties shall mutually agree. In the event that there is a Material Adverse Effect or the Company is in breach of this Agreement
or the Debenture the Purchaser will not be required to make the Subsequent Funding.

 

2.2
Deliveries.

 

(a)
On or prior to the initial Closing Date, the Company shall deliver or cause to be delivered to Purchaser the following:

 

(i)
this Agreement duly executed by the Company;

 

(ii)
an originally executed Note registered in the name of Purchaser in the principal amount of $82,500;

 

(iii)
an irrevocable transfer agent letter to reserve the amount of shares issuable upon conversion of the Debenture which letter shall
be in a form reasonably acceptable to the Purchaser;

 

(iv)
an originally executed Warrant to purchase 500,000 shares of the Company’s common stock (the “Warrant”) in the
form of Exhibit B attached hereto.

 

(b)
On or prior to the Closing Date, Purchaser shall deliver or cause to be delivered to the Company the following:

 

(i)
this Agreement duly executed by such Purchaser;

 

(ii)
$75,000 representing the purchase price which is the principal amount net of the $7,500 OID;

 

(c)
On the subsequent Closing Date, the Company shall deliver or cause to be delivered to Purchaser the following:

 

(i)
an originally executed Note registered in the name of such Purchaser in the principal amount that corresponds to the schedule
set forth above;

 

(ii)
a Warrant to purchase 500,000 of the Company’s Common Stock in the form attached hereto;

 

    	 		 

    	 

    

 

(iii)
a certificate duly executed by the Company’s chief executive officer in a form that is acceptable to the Purchaser; and

 

(d)
On each subsequent Closing Date, the Purchaser shall deliver (by wire transfer pursuant to wire instructions provided by the Company
to the Purchaser) to the applicable purchase price for the amount of the Note being funded according to the schedule above, provided
that the Purchaser may deduct the amount of $5,000 from the amount due for the second closing note for payment of Purchaser’s
legal fees.

 

2.3
Closing Conditions.

 

(a)
The obligations of the Company hereunder in connection with the closing are subject to the following conditions being met:

 

(i)
the accuracy in all material respects (or, to the extent representations or warranties are qualified by materiality or Material
Adverse Effect, in all respects) when made and on a Closing Date of the representations and warranties of the Purchaser contained
herein (unless as of a specific date therein in which case they shall be accurate as of such date);

 

(ii)
all obligations, covenants and agreements of Purchaser required to be performed at or prior to a Closing Date shall have been
performed; and

 

(iii)
the delivery by Purchaser of the items set forth in Section 2.2 of this Agreement.

 

(b)
The obligation of the Purchaser hereunder in connection with the closing are subject to the following conditions being met:

 

(i)
the accuracy in all material respects (or, to the extent representations or warranties are qualified by materiality or Material
Adverse Effect, in all respects) when made and on a Closing Date of the representations and warranties of the Company contained
herein (unless as of a specific date therein in which case they shall be accurate as of such date);

 

(ii)
all obligations, covenants and agreements of the Company required to be performed at or prior to an applicable Closing Date shall
have been performed;

 

(iii)
the delivery by the Company of the items set forth in Section 2.2(a) of this Agreement;

 

(iv)
there shall have been no Material Adverse Effect with respect to the Company since the date hereof and the Company shall not be
in breach of any Transaction Document;

 

(v)
from the date hereof to a Closing Date, trading in the Common Stock shall not have been suspended by the SEC or the Company’s
principal Trading Market, and, at any time prior to a Closing Date, trading in securities generally as reported by Bloomberg L.P.
shall not have been suspended or limited, or minimum prices shall not have been established on securities whose trades are reported
by such service, or on any Trading Market, nor shall a banking moratorium have been declared either by the United States or New
York State authorities nor shall there have occurred any material outbreak or escalation of hostilities or other national or international
calamity of such magnitude in its effect on, or any material adverse change in, any financial market which, in each case, in the
reasonable judgment of the Purchaser, makes it impracticable or inadvisable to purchase the Securities at on the Closing Date.

 

    	 		 

    	 

    

 

ARTICLE
III.

REPRESENTATIONS
AND WARRANTIES

 

3.1
Representations and Warranties of the Company. Except as set forth in the Disclosure Schedules, which Disclosure Schedules
shall be deemed a part hereof and shall qualify any representation or otherwise made herein to the extent of the disclosure contained
in the corresponding section of the Disclosure Schedules, the Company hereby makes the following representations and warranties
to each Purchaser:

 

(a)
Subsidiaries. The Company has two Subsidiaries. The Company owns, directly or indirectly, the capital stock or other equity
interests of each Subsidiary, in the amounts set forth on Schedule 3.1(a), free and clear of any Liens, and all of the issued
and outstanding shares of capital stock of each Subsidiary are validly issued and are fully paid, non-assessable and free of preemptive
and similar rights to subscribe for or purchase securities. If the Company has no Subsidiaries, all other references to the Subsidiaries
in the Transaction Documents shall be disregarded.

 

(b)
Organization and Qualification. The Company and each of the Subsidiaries is an entity duly incorporated or otherwise organized,
validly existing and in good standing under the laws of the jurisdiction of its incorporation or organization, with the requisite
power and authority to own and use its properties and assets and to carry on its business as currently conducted. Neither the
Company nor any Subsidiary is in violation nor default of any of the provisions of its respective certificate or articles of incorporation,
bylaws or other organizational or charter documents. Each of the Company and the Subsidiaries is duly qualified to conduct business
and is in good standing as a foreign corporation or other entity in each jurisdiction in which the nature of the business conducted
or property owned by it makes such qualification necessary, except where the failure to be so qualified or in good standing, as
the case may be, could not have or reasonably be expected to result in: (i) a material adverse effect on the legality, validity
or enforceability of any Transaction Document, (ii) a material adverse effect on the results of operations, assets, business,
prospects or condition (financial or otherwise) of the Company and the Subsidiaries, taken as a whole, or (iii) a material adverse
effect on the Company’s ability to perform in any material respect on a timely basis its obligations under any Transaction
Document (any of (i), (ii) or (iii), a “Material Adverse Effect”) and no Proceeding has been instituted in any
such jurisdiction revoking, limiting or curtailing or seeking to revoke, limit or curtail such power and authority or qualification.

 

(c)
Authorization; Enforcement. The Company has the requisite corporate power and authority to enter into and to consummate
the transactions contemplated by each of the Transaction Documents and otherwise to carry out its obligations hereunder and thereunder.
The execution and delivery of each of the Transaction Documents by the Company and the consummation by it of the transactions
contemplated hereby and thereby have been duly authorized by all necessary action on the part of the Company and no further action
is required by the Company, the Board of Directors or the Company’s stockholders in connection therewith other than in connection
with the Required Approvals. Each Transaction Document to which it is a party has been (or upon delivery will have been) duly
executed by the Company and, when delivered in accordance with the terms hereof and thereof, will constitute the valid and binding
obligation of the Company enforceable against the Company in accordance with its terms, except: (i) as limited by general equitable
principles and applicable bankruptcy, insolvency, reorganization, moratorium and other laws of general application affecting enforcement
of creditors’ rights generally, (ii) as limited by laws relating to the availability of specific performance, injunctive
relief or other equitable remedies and (iii) insofar as indemnification and contribution provisions may be limited by applicable
law.

 

    	 		 

    	 

    

 

(d)
No Conflicts. The execution, delivery and performance by the Company of the Transaction Documents and the consummation
by it to which it is a party of the other transactions contemplated hereby and thereby do not and will not: (i) conflict with
or violate any provision of the Company’s or any Subsidiary’s certificate or articles of incorporation, bylaws or
other organizational or charter documents, (ii) conflict with, or constitute a default (or an event that with notice or lapse
of time or both would become a default) under, result in the creation of any Lien upon any of the properties or assets of the
Company or any Subsidiary, or give to others any rights of termination, amendment, acceleration or cancellation (with or without
notice, lapse of time or both) of, any agreement, credit facility, debt or other instrument (evidencing a Company or Subsidiary
debt or otherwise) or other understanding to which the Company or any Subsidiary is a party or by which any property or asset
of the Company or any Subsidiary is bound or affected, or (iii) subject to the Required Approvals, conflict with or result in
a violation of any law, rule, regulation, order, judgment, injunction, decree or other restriction of any court or governmental
authority to which the Company or a Subsidiary is subject (including federal and state securities laws and regulations), or by
which any property or asset of the Company or a Subsidiary is bound or affected; except in the case of each of clauses (ii) and
(iii), such as could not have or reasonably be expected to result in a Material Adverse Effect.

 

(e)
Filings, Consents and Approvals. The Company is not required to obtain any consent, waiver, authorization or order of,
give any notice to, or make any filing or registration with, any court or other federal, state, local or other governmental authority
or other Person in connection with the execution, delivery and performance by the Company of the Transaction Documents, other
than: (i) the filings required pursuant to Section 4.6 and (ii) the filing of Form D with the Commission and such filings as are
required to be made under applicable state securities laws (collectively, the “Required Approvals”).

 

(f)
Issuance of the Securities. The issuance of the Debentures and Common Stock being issued pursuant to this Agreement have
been duly authorized and, when issued and paid for in accordance with the applicable Transaction Documents, and have been duly
and validly issued, fully paid and nonassessable, free and clear of all Liens imposed by the Company other than restrictions on
transfer provided for in the Transaction Documents. The Underlying Shares, when issued in accordance with the terms of the Transaction
Documents, will be validly issued, fully paid and nonassessable, free and clear of all Liens imposed by the Company other than
restrictions on transfer provided for in the Transaction Documents. The Company has reserved the Required Minimum for issuance
of the Underlying Shares.

 

(g)
Capitalization. The capitalization of the Company immediately prior to Closing is, in all material respects, as set forth
on Schedule 3.1(g). Except as provided on Schedule 3.1(g), no Person has (i) any right of first refusal, preemptive
right, right of participation, or any similar right to participate in the transactions contemplated by the Transaction Documents
except for such, if any, as will have been validly waived before the Closing and (ii) the issuance and sale of the Securities
will not obligate the Company to issue shares of Common Stock or other securities to any Person (other than the Purchaser) and
will not result in a right of any holder of Company securities to adjust the exercise, conversion, exchange or reset price under
any of such securities. All of the outstanding shares of capital stock of the Company are validly issued, fully paid and nonassessable,
have been issued in compliance with all federal and state securities laws, and none of such outstanding shares was issued in violation
of any preemptive rights or similar rights to subscribe for or purchase securities. No further approval or authorization of any
stockholder, the Board of Directors or others is required for the issuance and sale of the Securities. There are no stockholders’
agreements, voting agreements or other similar agreements with respect to the Company’s capital stock to which the Company
is a party or, to the knowledge of the Company, between or among any of the Company’s stockholders.

 

    	 		 

    	 

    

 

(h)
SEC Reports; Financial Statements, shell status. The Company is not required to file reports, schedules, forms, statements
and other documents under Section 15(d) of the Exchange Act (the foregoing materials, including the exhibits thereto and documents
incorporated by reference therein, being collectively referred to herein as the “SEC Reports”). The financial
statements of the Company included published with the OTCPink Reports comply in all material respects with applicable accounting
requirements and the rules and regulations of the Commission with respect thereto as in effect at the time of filing. Such financial
statements have been prepared in accordance with generally accepted accounting principles (“GAAP”), except as
may be otherwise specified in such financial statements or the notes thereto and except that unaudited financial statements may
not contain all footnotes required by GAAP, and fairly present in all material respects the financial position of the Company
and its consolidated Subsidiaries as of and for the dates thereof and the results of operations and cash flows for the periods
then ended, subject, in the case of unaudited statements, to normal, immaterial, year-end audit adjustments. The Company is not
now nor has it even been a “shell” as such term is defined in Rule 144 (i)(1) under the Exchange Act or “blank
check” company.

 

(i)
Material Changes. Except as provided in Schedule 3.1(i), since the date of the latest financial statements included
published with the OTCPink : (i) there has been no event, occurrence or development that has had or that could reasonably be expected
to result in a Material Adverse Effect, (ii) the Company has not incurred any liabilities (contingent or otherwise) other than
(A) trade payables and accrued expenses incurred in the ordinary course of business consistent with past practice and (B) liabilities
not required to be reflected in the Company’s financial statements pursuant to GAAP or disclosed in filings made with the
Commission, (iii) the Company has not altered its method of accounting, (iv) the Company has not declared or made any dividend
or distribution of cash or other property to its stockholders or purchased, redeemed or made any agreements to purchase or redeem
any shares of its capital stock and (v) the Company has not issued any equity securities to any officer, director or Affiliate,
except pursuant to existing Company equity incentive plans. The Company does not have pending before the Commission any request
for confidential treatment of information. Except for the issuance of the Securities contemplated by this Agreement, no event,
liability or development has occurred or exists with respect to the Company or its Subsidiaries or their respective business,
properties, operations or financial condition, that would be required to be disclosed by the Company under applicable securities
laws at the time this representation is made or deemed made that has not been publicly disclosed at least one Trading Day prior
to the date that this representation is made.

 

(j)
Litigation. There is no action, suit, inquiry, notice of violation, proceeding or investigation pending or, to the knowledge
of the Company, threatened against or affecting the Company, any Subsidiary or any of their respective properties before or by
any court, arbitrator, governmental or administrative agency or regulatory authority (federal, state, county, local or foreign)
(collectively, an “Action”) which (i) adversely affects or challenges the legality, validity or enforceability
of any of the Transaction Documents or the Securities or (ii) could, if there were an unfavorable decision, have or reasonably
be expected to result in a Material Adverse Effect. Neither the Company nor any Subsidiary, nor any director or officer thereof,
is or has been the subject of any Action involving a claim of violation of or liability under federal or state securities laws
or a claim of breach of fiduciary duty. There has not been, and to the knowledge of the Company, there is not pending or contemplated,
any investigation by the Commission involving the Company or any current or former director or officer of the Company. The Commission
has not issued any stop order or other order suspending the effectiveness of any registration statement filed by the Company or
any Subsidiary under the Exchange Act or the Securities Act.

 

    	 		 

    	 

    

 

(k)
Labor Relations. No material labor dispute exists or, to the knowledge of the Company, is imminent with respect to any
of the employees of the Company which could reasonably be expected to result in a Material Adverse Effect. None of the Company’s
or its Subsidiaries’ employees is a member of a union that relates to such employee’s relationship with the Company
or such Subsidiary, and neither the Company nor any of its Subsidiaries is a party to a collective bargaining agreement, and the
Company and its Subsidiaries believe that their relationships with their employees are good. No executive officer, to the knowledge
of the Company, is, or is now expected to be, in violation of any material term of any employment contract, confidentiality, disclosure
or proprietary information agreement or non-competition agreement, or any other contract or agreement or any restrictive covenant
in favor of any third party, and the continued employment of each such executive officer does not subject the Company or any of
its Subsidiaries to any liability with respect to any of the foregoing matters. To the Company’s knowledge, the Company
and its Subsidiaries are in compliance with all U.S. federal, state, local and foreign laws and regulations relating to employment
and employment practices, terms and conditions of employment and wages and hours, except where the failure to be in compliance
could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

 

(l)
Compliance. Neither the Company nor any Subsidiary: (i) is in default under or in violation of (and no event has occurred
that has not been waived that, with notice or lapse of time or both, would result in a default by the Company or any Subsidiary
under), nor has the Company or any Subsidiary received notice of a claim that it is in default under or that it is in violation
of, any indenture, loan or credit agreement or any other material agreement or instrument to which it is a party or by which it
or any of its properties is bound (whether or not such default or violation has been waived), (ii) is in violation of any order
of any court, arbitrator or governmental body or (iii) is or has been in violation of any statute, rule or regulation of any governmental
authority, including without limitation all foreign, federal, state and local laws applicable to its business and all such laws
that affect the environment, except in each of the foregoing cases as could not have or reasonably be expected to result in a
Material Adverse Effect.

 

(m)
Regulatory Permits. The Company and the Subsidiaries possess all certificates, authorizations and permits issued by the
appropriate federal, state, local or foreign regulatory authorities necessary to conduct their respective businesses, except where
the failure to possess such permits could not reasonably be expected to result in a Material Adverse Effect (“Material
Permits”), and neither the Company nor any Subsidiary has received any notice of proceedings relating to the revocation
or modification of any Material Permit.

 

(n)
Title to Assets. The Company and the Subsidiaries have good and marketable title in fee simple to all real property and
good and marketable title in all personal property owned by it that, in each case, is material to the business of the Company
and the Subsidiaries, in each case free and clear of all Liens, except for Liens as do not materially affect the value of such
property and do not materially interfere with the use made and proposed to be made of such property by the Company and the Subsidiaries
and Liens for the payment of federal, state or other taxes, the payment of which is neither delinquent nor subject to penalties
in any material respect. Any real property and facilities held under lease by the Company and the Subsidiaries are held by them
under valid, subsisting and enforceable leases with which the Company and the Subsidiaries are in compliance.

 

(o)
Patents and Trademarks. To the Company’s knowledge (without having conducted any independent investigation): (i)
the Company and the Subsidiaries have, or have rights to use, all patents, patent applications, trademarks, trademark applications,
service marks, trade names, trade secrets, inventions, copyrights, licenses and other intellectual property rights and similar
rights as as necessary or material for use in connection with their respective businesses and which the failure to so have could
reasonably be expected to have a Material Adverse Effect (collectively, the “Intellectual Property Rights“);
(ii) neither the Company nor any Subsidiary has received a notice (written or otherwise) that any of the Intellectual Property
Rights violates or infringes upon the rights of any Person; (iii) all such Intellectual Property Rights are enforceable and there
is no existing infringement by another Person of any of the Intellectual Property Rights, except where the failure to be so enforceable
or for such infringements as would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect;
and (iv) the Company and its Subsidiaries have taken reasonable security measures to protect the secrecy, confidentiality and
value of all of their intellectual properties, except where failure to do so could not, individually or in the aggregate, reasonably
be expected to have a Material Adverse Effect.

 

    	 		 

    	 

    

 

(p)
Transactions with Affiliates and Employees. None of the officers or directors of the Company and, to the knowledge of the
Company, none of the employees of the Company is presently a party to any transaction with the Company or any Subsidiary (other
than for services as employees, officers and directors), including any contract, agreement or other arrangement providing for
the furnishing of services to or by, providing for rental of real or personal property to or from, or otherwise requiring payments
to or from any officer, director or such employee or, to the knowledge of the Company, any entity in which any officer, director,
or any such employee has a substantial interest or is an officer, director, trustee or partner, in each case in excess of $120,000
other than for: (i) payment of salary or consulting fees for services rendered, (ii) reimbursement for expenses incurred on behalf
of the Company and (iii) other employee benefits, including stock option agreements under any stock option plan of the Company.

 

(q)
Environmental Laws. The Company and its subsidiaries are (i) in compliance with any and all applicable foreign, federal,
state and local laws and regulations relating to the protection of human health and safety, the environment or hazardous or toxic
substances or wastes, pollutants or contaminants (“Environmental Laws”), (ii) have received all permits, licenses or
other approvals required of them under applicable Environmental Laws to conduct their respective businesses and (iii) are in compliance
with all terms and conditions of any such permit, license or approval, except in each of the above cases where noncompliance could
not be reasonably expected to have a Material Adverse Effect.

 

(r)
Sarbanes-Oxley; Internal Accounting Controls. The Company is in material compliance with all provisions of the Sarbanes-Oxley
Act of 2002 which are applicable to it as of the Closing Date. The Company and the Subsidiaries will as of the filing of the Form
10, maintain a system of internal accounting controls sufficient to provide reasonable assurance that: (i) transactions are executed
in accordance with management’s general or specific authorizations, (ii) transactions are recorded as necessary to permit
preparation of financial statements in conformity with GAAP and to maintain asset accountability, (iii) access to assets is permitted
only in accordance with management’s general or specific authorization, and (iv) the recorded accountability for assets
is compared with the existing assets at reasonable intervals and appropriate action is taken with respect to any differences.

 

(s)
Certain Fees. Other than as set forth on Schedule 3.1(s), no brokerage or finder’s fees or commissions are or will
be payable by the Company to any broker, financial advisor or consultant, finder, placement agent, investment banker, bank or
other Person with respect to the transactions contemplated by the Transaction Documents,. The Purchaser shall have no obligation
with respect to any fees or with respect to any claims made by or on behalf of other Persons for fees of a type contemplated in
this Section that may be due in connection with the transactions contemplated by the Transaction Documents.

 

    	 		 

    	 

    

 

(t)
Private Placement. Assuming the accuracy of the Purchaser’s representations and warranties set forth in Section 3.2,
no registration under the Securities Act is required for the offer and sale of the Debentures by the Company to the Purchaser
as contemplated hereby. The issuance and sale of the Debentures hereunder does not contravene the rules and regulations of the
Trading Market.

 

(u)
Investment Company. The Company is not, and is not an Affiliate of, and immediately after receipt of payment for the Securities,
will not be or be an Affiliate of, an “investment company” within the meaning of the Investment Company Act of 1940,
as amended. The Company shall conduct its business in a manner so that it will not become subject to the Investment Company Act
of 1940, as amended.

 

(v)
Registration Rights. No Person has any right to cause the Company to effect the registration under the Securities Act of
any securities of the Company.

 

(w)
Listing and Maintenance Requirements. The Common Stock is not required to be registered pursuant to Section 12(b) or 12(g)
of the Exchange Act. The Company has not, in the 12 months preceding the date hereof, received notice from any Trading Market
on which the Common Stock is or has been listed or quoted to the effect that the Company is not in compliance with the listing
or maintenance requirements of such Trading Market. The Company is, and has no reason to believe that it will not in the foreseeable
future continue to be, in compliance with all such listing and maintenance requirements.

 

(x)
Application of Takeover Protections. The Company and the Board of Directors have taken all necessary action, if any, in
order to render inapplicable any control share acquisition, business combination, poison pill (including any distribution under
a rights agreement) or other similar anti-takeover provision under the Company’s certificate of incorporation (or similar
charter documents) or the laws of its state of incorporation that is or could become applicable to the Purchaser as a result of
the Purchaser and the Company fulfilling their obligations or exercising their rights under the Transaction Documents, including
without limitation as a result of the Company’s issuance of the Securities and the Purchaser’s ownership of the Securities.

 

(y)
Disclosure. Except with respect to (i) the material terms and conditions of the transactions contemplated by the Transaction
Documents and (ii) information given to the Investor, if any, which the Company hereby confirms will not constitute material non-public
information six months from the date hereof, the Company confirms that neither it nor any other Person acting on its behalf has
provided the Purchaser or their agents or counsel with any information that it believes constitutes or might constitute material,
nonpublic information. The Company understands and confirms that the Purchaser will rely on the foregoing representation in effecting
transactions in securities of the Company. All disclosure furnished in writing by or on behalf of the Company to the Purchaser
regarding the Company, its business and the transactions contemplated hereby, including the Disclosure Schedules to this Agreement,
is true and correct and does not contain any untrue statement of a material fact or omit to state any material fact necessary
in order to make the statements made therein, in light of the circumstances under which they were made, not misleading. The press
releases disseminated by the Company during the twelve months preceding the date of this Agreement taken as a whole do not contain
any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary in order to
make the statements therein, in light of the circumstances under which they were made and when made, not misleading.

 

    	 		 

    	 

    

 

The
Company acknowledges and agrees that the Purchaser has not made any representations or warranties with respect to the transactions
contemplated hereby other than those specifically set forth in Section 3.2 hereof.

 

(z)
No Integrated Offering. Assuming the accuracy of the Purchaser’s representations and warranties set forth in Section
3.2, neither the Company, nor any of its Affiliates, nor any Person acting on its or their behalf has, directly or indirectly,
made any offers or sales of any security or solicited any offers to buy any security, under circumstances that would cause this
offering of the Securities to be integrated with prior offerings by the Company for purposes of the Securities Act which would
require the registration of any such securities under the Securities Act.

 

(aa)
Tax Status. Except for matters that would not, individually or in the aggregate, have or reasonably be expected to result
in a Material Adverse Effect, the Company and each Subsidiary has filed all necessary federal, state and foreign income and franchise
tax returns and has paid or accrued all taxes shown as due thereon, and the Company has no knowledge of a tax deficiency which
has been asserted or threatened against the Company or any Subsidiary.

 

(bb)
No General Solicitation. Neither the Company nor any person acting on behalf of the Company has offered or sold any of
the Securities by any form of general solicitation or general advertising. The Company has offered the Securities for sale only
to the Purchaser and certain other “accredited investors” within the meaning of Rule 501 under the Securities Act.

 

(cc)
Foreign Corrupt Practices. Neither the Company, nor to the knowledge of the Company, any agent or other person acting on
behalf of the Company, has: (i) directly or indirectly, used any funds for unlawful contributions, gifts, entertainment or other
unlawful expenses related to foreign or domestic political activity, (ii) made any unlawful payment to foreign or domestic government
officials or employees or to any foreign or domestic political parties or campaigns from corporate funds, (iii) failed to disclose
fully any contribution made by the Company (or made by any person acting on its behalf of which the Company is aware) which is
in violation of law or (iv) violated in any material respect any provision of the Foreign Corrupt Practices Act of 1977, as amended.

 

(dd)
No Disagreements with Accountants and Lawyers; Outstanding SEC Comments. There are no disagreements of any kind presently
existing, or reasonably anticipated by the Company to arise, between the Company and the accountants and lawyers formerly or presently
employed by the Company and the Company is or immediately after the Closing Date will be current with respect to any fees owed
to its accountants which could affect the Company’s ability to perform any of its obligations under any of the Transaction
Documents. There are no unresolved comments or inquiries received by the Company or its Affiliates from the Commission which remain
unresolved as of the date hereof.

 

(ee)
Acknowledgment Regarding Purchaser’s Purchase of Securities. The Company acknowledges and agrees that the Purchaser
is acting solely in the capacity of an arm’s length purchaser with respect to the Transaction Documents and the transactions
contemplated thereby. The Company further acknowledges that no Purchaser is acting as a financial advisor or fiduciary of the
Company (or in any similar capacity) with respect to the Transaction Documents and the transactions contemplated thereby and any
advice given by the Purchaser or any of their respective representatives or agents in connection with the Transaction Documents
and the transactions contemplated thereby is merely incidental to the Purchaser’s purchase of the Securities. The Company
further represents to the Purchaser that the Company’s decision to enter into this Agreement and the other Transaction Documents
has been based solely on the independent evaluation of the transactions contemplated hereby by the Company and its representatives.

 

    	 		 

    	 

    

 

(ff)
Disqualification. No executive officer, member of the Board of Directors of the Company or shareholder of the Company beneficially
owning more than 10% of the Company’s securities is currently subject to a Disqualifying Event. For purposes of this Agreement,
“Disqualifying Event” means any conviction, order, judgment, decree, suspension, expulsion, event or other matter set
out in Rule 506(d)(1)(i) through (viii) of Regulation D that is currently in effect or which occurred within the periods set out
in Rule 506(d)(1)(i) through (viii).

 

(gg)
Solvency Based on the consolidated financial condition of the Company as of the Closing Date, after giving effect to the
receipt by the Company of the proceeds from the sale of the Securities hereunder, (i) the fair saleable value of the Company’s
assets exceeds the amount that will be required to be paid on or in respect of the Company’s existing debts and other liabilities
(including known contingent liabilities) as they mature, (ii) the Company’s assets do not constitute unreasonably small
capital to carry on its business as now conducted and as proposed to be conducted including its capital needs taking into account
the particular capital requirements of the business conducted by the Company, consolidated and projected capital requirements
and capital availability thereof, and (iii) the current cash flow of the Company, together with the proceeds the Company would
receive, were it to liquidate all of its assets, after taking into account all anticipated uses of the cash, would be sufficient
to pay all amounts on or in respect of its liabilities when such amounts are required to be paid. As of the date hereof, the Company
has no intention to file for reorganization or liquidation under the bankruptcy or reorganization laws of any jurisdiction within
one year from the Closing Date. Schedule 3.1(gg) sets forth as of the date hereof all outstanding secured and unsecured
Indebtedness of the Company or any Subsidiary, or for which the Company or any Subsidiary has commitments. For the purposes of
this Agreement, “Indebtedness” means (x) any liabilities for borrowed money or amounts owed in excess of $10,000 (other
than trade accounts payable incurred in the ordinary course of business), (y) all guaranties, endorsements and other contingent
obligations in respect of indebtedness of others, whether or not the same are or should be reflected in the Company’s consolidated
balance sheet (or the notes thereto), except guaranties by endorsement of negotiable instruments for deposit or collection or
similar transactions in the ordinary course of business; and (z) the present value of any lease payments in excess of $10,000
due under leases required to be capitalized in accordance with GAAP. Neither the Company nor any Subsidiary is in default with
respect to any Indebtedness. On each closing the Notes shall be senior to the Company’s existing debt and there are no existing
Liens or security interest on any of the Company’s assets or any Subsidiary of the Company.

 

3.2
Representations and Warranties of the Purchaser. The Purchaser hereby represents and warrants as of the date hereof and
as of the Closing Date to the Company as follows:

 

(a)
Organization; Authority. The Purchaser is an entity duly organized, validly existing and in good standing under the laws
of the jurisdiction of its organization with full right, corporate or partnership power and authority to enter into and to consummate
the transactions contemplated by the Transaction Documents and otherwise to carry out its obligations hereunder and thereunder.
Each Transaction Document to which it is a party has been duly executed by the Purchaser, and when delivered by the Purchaser
in accordance with the terms hereof, will constitute the valid and legally binding obligation of the Purchaser, enforceable against
it in accordance with its terms, except: (i) as limited by general equitable principles and applicable bankruptcy, insolvency,
reorganization, moratorium and other laws of general application affecting enforcement of creditors’ rights generally, (ii)
as limited by laws relating to the availability of specific performance, injunctive relief or other equitable remedies and (iii)
insofar as indemnification and contribution provisions may be limited by applicable law.

 

    	 		 

    	 

    

 

(b) Own
Account. The Purchaser understands that the Securities are “restricted securities” and have not been
registered under the Securities Act or any applicable state securities law and is acquiring the Securities as principal for
its own account and not with a view to or for distributing or reselling such Securities or any part thereof in violation of
the Securities Act or any applicable state securities law, has no present intention of distributing any of such Securities in
violation of the Securities Act or any applicable state securities law and has no direct or indirect arrangement or
understandings with any other persons to distribute or regarding the distribution of such Securities (this representation and
warranty not limiting the Purchaser’s right to sell the Securities pursuant to a registration statement or otherwise in
compliance with applicable federal and state securities laws) in violation of the Securities Act or any applicable state
securities law. The Purchaser is acquiring the Securities hereunder in the ordinary course of its business.

 

(c)
Purchaser Status. At the time the Purchaser was offered the Debentures, it was, and as of the date hereof it is, and on
each date on which it converts any Debentures it will be either: (i) an “accredited investor” as defined in Rule 501(a)(1),
(a)(2), (a)(3), (a)(7) or (a)(8) under the Securities Act or (ii) a “qualified institutional buyer” as defined in Rule
144A(a) under the Securities Act. The Purchaser is not required to be registered as a broker-dealer under Section 15 of the Exchange
Act.

 

(d)
Experience of the Purchaser. The Purchaser, either alone or together with its representatives, has such knowledge, sophistication
and experience in business and financial matters so as to be capable of evaluating the merits and risks of the prospective investment
in the Securities, and has so evaluated the merits and risks of such investment. The Purchaser is able to bear the economic risk
of an investment in the Securities and, at the present time, is able to afford a complete loss of such investment.

 

(e)
General Solicitation. The Purchaser is not purchasing the Securities as a result of any advertisement, article, notice
or other communication regarding the Securities published in any newspaper, magazine or similar media or broadcast over television
or radio or presented at any seminar or any other general solicitation or general advertisement.

 

ARTICLE
IV.

OTHER
AGREEMENTS OF THE PARTIES

 

4.1
Transfer Restrictions.

 

(a)
The Securities may only be disposed of in compliance with state and federal securities laws. In connection with any transfer of
Securities other than pursuant to an effective registration statement or Rule 144, to the Company or in connection with a pledge
as contemplated in Section 4.1(b), the Company may require the transferor thereof to provide to the Company an opinion of counsel
selected by the transferor and reasonably acceptable to the Company, the form and substance of which opinion shall be reasonably
satisfactory to the Company, to the effect that such transfer does not require registration of such transferred Securities under
the Securities Act. As a condition of transfer, any such transferee shall agree in writing to be bound by the terms of this Agreement,
including the representations and warranties made by each Purchaser herein, and shall have the rights of a Purchaser under this
Agreement.

 

    	 		 

    	 

    

 

(b)
The Purchaser agrees to the imprinting, so long as is required by this Section 4.1, of a legend on any of the Securities in the
following form:

 

NEITHER
THIS SECURITY NOR THE SECURITIES INTO WHICH THIS SECURITY IS CONVERTIBLE HAS NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE
COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT
OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO,
THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS AS EVIDENCED BY A
LEGAL OPINION OF COUNSEL TO THE TRANSFEROR TO SUCH EFFECT, THE SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE COMPANY.
THIS SECURITY AND THE SECURITIES ISSUABLE UPON CONVERSION OF THIS SECURITY MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN
ACCOUNT OR OTHER LOAN SECURED BY SUCH SECURITIES.

 

The
Company acknowledges and agrees that the Purchaser may from time to time grant a security interest in some or all of the Securities
to a financial institution that is an “accredited investor” as defined in Rule 501(a) under the Securities Act and who
agrees in writing with the Company to be bound by the provisions of this Agreement and, if required under the terms of such arrangement
and subject to compliance with applicable federal and state securities laws, the Purchaser may transfer secured Securities to
the secured parties. Absent special circumstances, such a transfer would not be subject to approval of the Company and no legal
opinion of legal counsel of the secured party shall be required in connection therewith. At the Purchaser’s expense, the
Company will execute and deliver such reasonable documentation as a secured party of Securities may reasonably request in connection
with a pledge or transfer of the Securities.

 

(c)
Certificates evidencing the Underlying Shares (or, if Underlying Shares are issued in uncertificated form, comparable share notices)
shall not contain any legend (including the legend set forth in Section 4.1(b) hereof): (i) while a registration statement covering
the resale of such security is effective under the Securities Act, or (ii) following any sale of such Underlying Shares pursuant
to Rule 144, or (iii) if such Underlying Shares are eligible for sale under Rule 144, without the requirement for the Company
to be in compliance with the current public information required under Rule 144 as to such Underlying Shares and without volume
or manner-of-sale restrictions, or (iv) if such legend is not otherwise required under applicable requirements of the Securities
Act (including judicial interpretations and pronouncements issued by the staff of the Commission), as reasonably determined by
the Company. Upon the Purchaser’s request in connection with a proposed sale of Underlying Shares pursuant to Rule 144 and
if the Company reasonably determines it is so required, upon receipt of customary documentation from Purchaser’s broker
(if the Underlying Shares are sold in brokers transactions), the Company shall, at its own cost and effort, retain legal counsel
to provide an opinion letter to the Company’s transfer agent opining that the Underlying Shares may be resold without registration
under the Securities Act, pursuant to Rule 144, promulgated thereunder, so long as the requirements of Rule 144 are met for any
Underlying Shares to be resold thereunder. The Company shall arrange for any such opinion letter to be provided not later than
two (2) business days after the date of delivery to and receipt by the Company of a written request by the Purchaser together
with (if required in order to render the opinion) any broker’s representation letter of other customary documentation reasonably
requested by the Company evidencing compliance with Rule 144 (the “Legend Removal Date”).

 

(d)
In addition to the Purchaser’s other available remedies, the Company shall pay to the Purchaser, in cash, as partial liquidated
damages and not as a penalty, for each $1,000 of Underlying Shares (based on the VWAP of the Common Stock on the date such Securities
are submitted to the Transfer Agent) delivered for removal of the restrictive legend and subject to Section 4.1(c), $10 per Trading
Day (increasing to $20 per Trading Day 5 Trading Days after such damages have begun to accrue) for each Trading Day after the
Legend Removal Date until such certificate (or, if the Underlying Shares are in uncertificated form, a comparable notice of share
ownership) is delivered without a legend. Nothing herein shall limit the Purchaser’s right to pursue actual damages for
the Company’s failure to deliver certificates representing any Securities as required by the Transaction Documents, and
the Purchaser shall have the right to pursue all remedies available to it at law or in equity including, without limitation, a
decree of specific performance and/or injunctive relief.

 

    	 		 

    	 

    

 

(e)
The Purchaser agrees that the Purchaser will sell any Securities only pursuant to either an exemption from registration or a registration
statement under the Securities Act, including any applicable prospectus delivery requirements, and that if Securities are sold
pursuant to a registration statement, they will be sold in compliance with the plan of distribution set forth therein, and acknowledges
that the removal of the restrictive legend from certificates representing Securities as set forth in this Section 4.1 is predicated
upon the Company’s reliance upon this understanding.

 

4.2
Acknowledgment of Dilution. The Company acknowledges that the issuance of the Securities may result in dilution of the
outstanding shares of Common Stock, which dilution may be substantial under certain market conditions. The Company further acknowledges
that its obligations under the Transaction Documents, including, without limitation, its obligation to issue the Underlying Shares
pursuant to the Transaction Documents, are unconditional and absolute and not subject to any right of set off, counterclaim, delay
or reduction, regardless of the effect of any such dilution or any claim the Company may have against the Purchaser and regardless
of the dilutive effect that such issuance may have on the ownership of the other stockholders of the Company.

 

4.3
Furnishing of Information. Beginning no later than ninety days from the date of this Agreement, and until) the Purchaser
owns no Securities the Company covenants that it will maintain the registration of the Common Stock under Section 12(b) or 12(g)
of the Exchange Act and to use all commercially reasonable efforts to timely file (or obtain extensions in respect thereof and
file within the applicable grace period) all reports required to be filed by the Company after the date hereof pursuant to the
Exchange Act. As long as the Purchaser owns Securities, if the Company is not required to file reports pursuant to the Exchange
Act, it will prepare and furnish to the Purchaser and make publicly available in accordance with Rule 144(c) such information
as is required for the Purchaser to sell the Securities under Rule 144. The Company further covenants that it will use all commercially
reasonable efforts to take such further action as any holder of Securities may reasonably request, to the extent required from
time to time to enable such Person to sell such Securities without registration under the Securities Act within the requirements
of the exemption provided by Rule 144.

 

4.4
Integration. The Company shall not sell, offer for sale or solicit offers to buy or otherwise negotiate in respect of any
security (as defined in Section 2 of the Securities Act) that would be integrated with the offer or sale of the Securities to
the Purchaser in a manner that would require the registration under the Securities Act of the sale of the Securities to the Purchaser.

 

4.5
Conversion and Exercise Procedures. The form of Notice of Conversion included in the Debentures sets forth the totality
of the procedures required of the Purchaser in order to convert the Debentures. No additional legal opinion, other information
or instructions shall be required of the Purchaser to convert their Debentures. The Company shall honor conversions of the Debentures
and shall deliver Underlying Shares in accordance with the terms, conditions and time periods set forth in the Transaction Documents.

 

    	 		 

    	 

    

 

4.6
Securities Laws Disclosure; Publicity. The Company shall, by 8:30 a.m. (New York City time) on the Trading Day immediately
following the date hereof, issue press release disclosing the material terms of the transactions contemplated hereby and including
the Transaction Documents as exhibits thereto. The Company and the Purchaser shall consult with each other in issuing any other
press releases with respect to the transactions contemplated hereby, and neither the Company nor the Purchaser shall issue any
such press release nor otherwise make any such public statement) without the prior consent of the Company, with respect to any
press release of the Purchaser, or without the prior consent of the Purchaser, with respect to any press release of the Company,
which consent shall not unreasonably be withheld or delayed, except if such disclosure is required by law, in which case the disclosing
party shall promptly provide the other party with prior notice of such public statement or communication. Notwithstanding the
foregoing, other than in connection with the Company’s SEC Reports or disclosures to any regulatory agency or Trading Market
that the Company determines are necessary or appropriate, the Company shall not publicly disclose the name of the Purchaser, or
include the name of the Purchaser, in any press release or similar public statement, without the prior written consent of the
Purchaser.

 

4.7
Shareholder Rights Plan. No claim will be made or enforced by the Company or, with the consent of the Company, any other
Person, that the Purchaser is an “Acquiring Person” under any control share acquisition, business combination, poison
pill (including any distribution under a rights agreement) or similar anti-takeover plan or arrangement in effect, or that the
Purchaser could be deemed to trigger the provisions of any such plan or arrangement, by virtue of receiving Securities under the
Transaction Documents or any other agreement between the Company and the Purchaser.

 

4.8
Non-Public Information. Except with respect to the material terms and conditions of the transactions contemplated by the
Transaction Documents, the Company covenants and agrees that after the Closing Date neither it, nor any other Person acting on
its behalf, will provide the Purchaser or its agents or counsel with any information that the Company believes constitutes material
non-public information, unless prior thereto the Purchaser shall have executed a written agreement regarding the confidentiality
and use of such information. The Company understands and confirms that the Purchaser shall be relying on the foregoing covenant
in effecting transactions in securities of the Company. Purchaser acknowledges that it is aware that the United States securities
laws prohibit any person who has material non-public information about a company from purchasing or selling securities of such
company, or from communicating such information to any other person under circumstances in which it is reasonably foreseeable
that such person is likely to purchase or sell such securities, and Purchaser agrees not to engage in any unlawful trading in
securities of the Company or unlawful misuse or misappropriation of any such information. Purchaser agrees to maintain the confidentiality
of and not disclose or use (except for purposes relating to the transactions contemplated by this Agreement) any confidential,
proprietary or non-public information disclosed by the Company to Purchaser.

 

4.9
Use of Proceeds. The Company shall use the net proceeds from the sale of the Securities hereunder for working capital purposes.
The Company shall not use any of the net proceeds from the sale of the Debentures for: (a) the satisfaction of any portion of
the Company’s debt (other than payment of trade payables in the ordinary course of the Company’s business and prior
practices), (b) the redemption of any Common Stock or Common Stock Equivalents or (c) the settlement of any litigation.

 

4.10
Indemnification of Purchaser. Subject to the provisions of this Section 4.10, the Company will indemnify and hold the Purchaser
and its directors, officers, shareholders, members, partners, employees and agents (and any other Persons with a functionally
equivalent role of a Person holding such titles notwithstanding a lack of such title or any other title), each Person who controls
the Purchaser (within the meaning of Section 15 of the Securities Act and Section 20 of the Exchange Act), and the directors,
officers, shareholders, agents, members, partners or employees (and any other Persons with a functionally equivalent role of a
Person holding such titles notwithstanding a lack of such title or any other title) of such controlling person (each, a “Purchaser
Party”) harmless from any and all losses, liabilities, obligations, claims, contingencies, damages, costs and expenses,
including all judgments, amounts paid in settlements, court costs and reasonable attorneys’ fees and costs of investigation
that any such Purchaser Party may suffer or incur as a result of or relating to any action, suit, claim or proceeding brought
by a third party against such Purchaser Party arising out of or relating to (a) any breach of any of the representations, warranties,
covenants or agreements made by the Company in this Agreement or in the other Transaction Documents or (b) any action instituted
against a Purchaser in any capacity, or any of them or their respective Affiliates, by any stockholder of the Company who is not
an Affiliate of the Purchaser, with respect to any of the transactions contemplated by the Transaction Documents (unless such
action is based upon a breach of such Purchaser’s representations, warranties or covenants under the Transaction Documents
or any agreements or understandings the Purchaser may have with any such stockholder or any violations by the Purchaser of state
or federal securities laws or any conduct by the Purchaser which constitutes fraud, gross negligence, willful misconduct or malfeasance).
If any action shall be brought against the Purchaser Party in respect of which indemnity may be sought pursuant to this Agreement,
such Purchaser Party shall promptly notify the Company in writing, and the Company shall have the right to assume the defense
thereof with counsel of its own choosing reasonably acceptable to the Purchaser Party. Any Purchaser Party shall have the right
to employ separate counsel in any such action and participate in the defense thereof, but the fees and expenses of such counsel
shall be at the expense of such Purchaser Party except to the extent that (i) the employment thereof has been specifically authorized
by the Company in writing, (ii) the Company has failed after a reasonable period of time to assume such defense and to employ
counsel or (iii) in such action there is, in the reasonable opinion of such separate counsel, a material conflict on any material
issue between the position of the Company and the position of such Purchaser Party, in which case the Company shall be responsible
for the reasonable fees and expenses of no more than one such separate counsel. The Company will not be liable to any Purchaser
Party under this Agreement (y) for any settlement by a Purchaser Party effected without the Company’s prior written consent,
which shall not be unreasonably withheld or delayed; or (z) to the extent, but only to the extent that a loss, claim, damage or
liability is attributable to any Purchaser Party’s breach of any of the representations, warranties, covenants or agreements
made by such Purchaser Party in this Agreement or in the other Transaction Documents.

 

    	 		 

    	 

    

 

4.11
Reservation and Listing of Securities.

 

(a)
The Company shall maintain a reserve from its duly authorized shares of Common Stock for issuance pursuant to the Transaction
Documents in such amount as may then be required to fulfill its obligations in full under the Transaction Documents.

 

(b)
If, on any date, the number of authorized but unissued (and otherwise unreserved) shares of Common Stock is less than the Required
Minimum on such date, then the Board of Directors shall use commercially reasonable efforts to amend the Company’s certificate
or articles of incorporation to increase the number of authorized but unissued shares of Common Stock to at least the Required
Minimum at such time, as soon as possible and in any event not later than the 60th calendar day after such date.

 

(c)
The Company shall, if applicable: (i) in the time and manner required by the principal Trading Market, prepare and file with such
Trading Market an additional shares listing application covering a number of shares of Common Stock at least equal to the Required
Minimum on the date of such application, (ii) take all steps necessary to cause such shares of Common Stock to be approved for
listing on such Trading Market as soon as possible thereafter, (iii) provide to the Purchaser evidence of such listing and (iv)
maintain the listing of such Common Stock on any date at least equal to the Required Minimum on such date on such Trading Market
or another Trading Market.

 

    	 		 

    	 

    

 

4.12
Form D; Blue Sky Filings. The Company agrees to timely file a Form D with respect to the Securities as required under Regulation
D and to provide a copy thereof, promptly upon request of the Purchaser. The Company shall take such action as the Company shall
reasonably determine is necessary in order to obtain an exemption for, or to qualify the Securities for, sale to the Purchaser
at the Closing under applicable securities or “Blue Sky” laws of the states of the United States, and shall provide
evidence of such actions promptly upon request of the Purchaser.

 

4.13
Corporate Existence. So long as any of the Debentures remain outstanding, the Company shall not directly or indirectly
consummate any merger, reorganization, restructuring, consolidation, sale of all or substantially all of the Company’s assets
or any similar transaction or related transactions (each such transaction, an “Organizational Change”) unless,
prior to the consummation an Organizational Change, the Company obtains the written consent of the Purchaser, which consent shall
not be unreasonably withheld. In any such case, the Company will make appropriate provision with respect to such holders’
rights and interests to insure that the provisions of this Section 4.13 will thereafter be applicable to the Debentures.

 

4.14
Transfer Agent. The Company covenants and agrees that it will at all times while the Debentures remains outstanding maintain
a duly qualified independent transfer agent.

 

4.15
Reserved.

 

4.16
No Short Selling. The Purchaser has and shall not, directly or indirectly, his, her or itself, through related parties,
affiliates or otherwise, (i) sell “short” or “short against the box” (as those terms are generally understood)
any equity security of the Company or (ii) otherwise engage in any transaction that involves hedging of the Purchaser’s
position in any equity security of the Company, until the later of (i) the date the Debentures owned by the Purchaser is no longer
owned by the Purchaser, or (ii) the Maturity Date (as such term is defined in the Debentures) and the Conversion Date.

 

4.17
Subsequent Rights Offerings. If at any time the Company grants, issues or sells any Common Stock, Common Stock Equivalents
or rights to purchase stock, warrants, securities or other property pro rata to the record holders of any class of shares of Common
Stock (the “Purchase Rights”), then the Holder will be entitled to acquire, upon the terms applicable to such Purchase
Rights, the aggregate Purchase Rights which the Holder could have acquired if the Holder had held the number of shares of Common
Stock acquirable upon complete conversion of this Note (without regard to any limitations on conversion hereof, including without
limitation, the Beneficial Ownership Limitation) immediately before the date on which a record is taken for the grant, issuance
or sale of such Purchase Rights, or, if no such record is taken, the date as of which the record holders of shares of Common Stock
are to be determined for the grant, issue or sale of such Purchase Rights (provided, however, to the extent that the Holder’s
right to participate in any such Purchase Right would result in the Holder exceeding the Beneficial Ownership Limitation, then
the Holder shall not be entitled to participate in such Purchase Right to such extent (or in the beneficial ownership of any shares
of Common Stock as a result of such Distribution to such extent).

 

4.18
Registration Rights (a) Within 60 days of the filing of the Form 10, the Company shall file a registration statement on
Form S-1 with the SEC (the “Registration Statement”) to register the resale by the Purchaser of all Registrable Securities
within. “Registrable Securities” means all shares of Common Stock issuable upon conversion of the Debentures issued
pursuant to this Agreement and all shares of Common Stock issuable upon exercise of the Warrants issued pursuant to this Agreement;
provided that a share of Common Stock shall cease to be a Registrable Security upon the earliest to occur of the following: (a)
its sale pursuant to the Registration Statement or Rule 144 under the Securities Act; or (B) it becomes eligible for resale by
its holder under Rule 144 without the requirement for the Company to be in compliance with the current public information required
thereunder and without volume or manner-of-sale restrictions. As long as the Purchaser owns any Registrable Securities the Company
shall keep the Registration Statement effective and shall file such post-effective amendments to such Registration Statement as
is required to keep such Registration Statement effective with the SEC. Without limiting the generality of the foregoing, without
the consent of the Purchaser except for the Registrable Securities, no other securities shall be included on or in the Registration
Statement and the Company shall not file another registration statement with the SEC until the Registration Statement has been
declared effective by the SEC or the Registrable Securities cease to be Registerable Securities as provided herein.

 

    	 		 

    	 

    

 

(b)
While the Registration Statement remains effective, Purchaser hereunder may sell its Registrable Securities in accordance with
the plan of distribution contained in the Registration Statement and if it does so it will comply therewith and with the related
prospectus delivery requirements unless an exemption therefrom is available. Purchaser shall, if notified by the Company in writing
at any time that the Registration Statement is not effective or that the prospectus included in such Registration Statement no
longer complies with the requirements of Section 10 of the Securities Act, refrain from selling such Shares until such time as
the Company notifies the Purchaser in writing that the Registration Statement is effective or the prospectus is compliant with
Section 10 of the Securities Act, unless such Purchaser is able to, and does, sell such Registrable Securities pursuant to an
available exemption from the registration requirements of Section 5 of the Securities Act. Purchaser agrees to promptly furnish
to the Company such information that the Company reasonably requires from that Purchaser for use in the Registration Statement
and consents to the inclusion of such information in the Registration Statement.

 

ARTICLE
V.

MISCELLANEOUS

 

5.1
Termination. This Agreement may be terminated by the Purchaser, as to the Purchaser’s obligations hereunder only
and without any effect whatsoever on the obligations between the Company and the Purchaser, by written notice to the other parties,
if the second Closing has not been consummated on or before May 31, 2017; provided, however, that such termination
will not affect the right of any party to sue for any breach by the other party (or parties).

 

5.2
Fees and Expenses. Except as expressly set forth in the Transaction Documents to the contrary, each party shall pay the
fees and expenses of its advisers, counsel, accountants and other experts, if any, and all other expenses incurred by such party
incident to the negotiation, preparation, execution, delivery and performance of this Agreement. The Company shall pay all transfer
agent fees, stamp taxes and other taxes and duties levied in connection with the delivery of any Securities to the Purchaser.
The Company agrees to pay counsel for the Purchaser $10,000 in fees., of which $5,000 has been paid. The Purchaser may withhold
$5,000 of the purchase price of the second Debenture in order to pay the balance of the fees due its counsel.

 

5.3
Entire Agreement. The Transaction Documents, together with the exhibits and schedules thereto, contain the entire understanding
of the parties with respect to the subject matter hereof and supersede all prior agreements and understandings, oral or written,
with respect to such matters, which the parties acknowledge have been merged into such documents, exhibits and schedules.

 

    	 		 

    	 

    

 

5.4
Notices. Unless otherwise agreed to by the Parties, all notices, demands, requests, consents, approvals, and other communications
required or permitted hereunder shall be in writing and, unless otherwise specified herein, shall be (i) personally served, (ii)
deposited in the mail, registered or certified, return receipt requested, postage prepaid, (iii) delivered by reputable air courier
service with charges prepaid, or (iv) transmitted by hand delivery, telegram, email addressed as set forth on the signature pages
to this Agreement or to such other address or email address as such party shall have specified most recently by written notice.
Any notice or other communication required or permitted to be given hereunder shall be deemed effective (a) upon hand delivery
or delivery by email at the address designated below (if delivered on a business day during normal business hours where such notice
is to be received), or the first business day following such delivery (if delivered other than on a business day during normal
business hours where such notice is to be received) or (b) on the second business day following the date of mailing by express
courier service, fully prepaid, addressed to such address, or upon actual receipt of such mailing, whichever shall first occur.
The addresses for such communications shall be as set forth on the signature page to this Agreement.

 

5.5
Amendments; Waivers. No provision of this Agreement may be waived, modified, supplemented or amended except in a written
instrument signed, in the case of an amendment, by the Company and the Purchaser or, in the case of a waiver, by the party against
whom enforcement of any such waived provision is sought. No waiver of any default with respect to any provision, condition or
requirement of this Agreement shall be deemed to be a continuing waiver in the future or a waiver of any subsequent default or
a waiver of any other provision, condition or requirement hereof, nor shall any delay or omission of any party to exercise any
right hereunder in any manner impair the exercise of any such right.

 

5.6
Headings. The headings herein are for convenience only, do not constitute a part of this Agreement and shall not be deemed
to limit or affect any of the provisions hereof.

 

5.7
Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the parties and their successors
and permitted assigns. The Company may not assign this Agreement or any rights or obligations hereunder without the prior written
consent of the Purchaser (other than by merger). The Purchaser may assign any or all of its rights under this Agreement to any
Person to whom the Purchaser assigns or transfers any Securities, provided that such transfer complies with all applicable federal
and state securities laws and that such transferee agrees in writing with the Company to be bound, with respect to the transferred
Securities, by the provisions of the Transaction Documents that apply to the Purchaser.

 

5.8
No Third-Party Beneficiaries. This Agreement is intended for the benefit of the parties hereto and their respective successors
and permitted assigns and is not for the benefit of, nor may any provision hereof be enforced by, any other Person, except as
otherwise set forth in Section 4.10.

 

5.9
Governing Law. All questions concerning the construction, validity, enforcement and interpretation of the Transaction Documents
shall be governed by and construed and enforced in accordance with the internal laws of the State of New York, without regard
to the principles of conflicts of law thereof. Each party agrees that all legal proceedings concerning the interpretations, enforcement
and defense of the transactions contemplated by this Agreement and any other Transaction Documents (whether brought against a
party hereto or its respective affiliates, directors, officers, shareholders, employees or agents) shall be commenced exclusively
in the state and federal courts sitting in the City of New York. Each party hereby irrevocably submits to the exclusive jurisdiction
of the state and federal courts sitting in the City of New York, borough of Manhattan for the adjudication of any dispute hereunder
or in connection herewith or with any transaction contemplated hereby or discussed herein (including with respect to the enforcement
of any of the Transaction Documents), and hereby irrevocably waives, and agrees not to assert in any suit, action or proceeding,
any claim that it is not personally subject to the jurisdiction of any such court, that such suit, action or proceeding is improper
or is an inconvenient venue for such proceeding. Each party hereby irrevocably waives personal service of process and consents
to process being served in any such suit, action or proceeding by mailing a copy thereof via registered or certified mail or overnight
delivery (with evidence of delivery) to such party at the address in effect for notices to it under this Agreement and agrees
that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein shall be
deemed to limit in any way any right to serve process in any other manner permitted by law. If either party shall commence an
action or proceeding to enforce any provisions of the Transaction Documents, then the prevailing party in such action or proceeding
shall be reimbursed by the other party for its reasonable attorneys’ fees and other costs and expenses incurred with the
investigation, preparation and prosecution of such action or proceeding.

 

    	 		 

    	 

    

 

5.10
Survival. The representations and warranties shall survive the Closing and the delivery of the Debentures until, with respect
to the Purchaser, the Debentures held by the Purchaser has been paid in full or converted into Underlying Shares, at which time
they shall expire such respect to Purchaser and shall no longer be of any force or effect.

 

5.11
Execution. This Agreement may be executed in two or more counterparts, all of which when taken together shall be considered
one and the same agreement and shall become effective when counterparts have been signed by each party and delivered to the other
party, it being understood that both parties need not sign the same counterpart. In the event that any signature is delivered
by facsimile transmission or by e-mail delivery of a “.pdf” format data file, such signature shall create a valid and
binding obligation of the party executing (or on whose behalf such signature is executed) with the same force and effect as if
such facsimile or “.pdf” signature page were an original thereof.

 

5.12
Severability. If any term, provision, covenant or restriction of this Agreement is held by a court of competent jurisdiction
to be invalid, illegal, void or unenforceable, the remainder of the terms, provisions, covenants and restrictions set forth herein
shall remain in full force and effect and shall in no way be affected, impaired or invalidated, and the parties hereto shall use
their commercially reasonable efforts to find and employ an alternative means to achieve the same or substantially the same result
as that contemplated by such term, provision, covenant or restriction. It is hereby stipulated and declared to be the intention
of the parties that they would have executed the remaining terms, provisions, covenants and restrictions without including any
of such that may be hereafter declared invalid, illegal, void or unenforceable.

 

5.13
Rescission and Withdrawal Right. Notwithstanding anything to the contrary contained in (and without limiting any similar
provisions of) any of the other Transaction Documents, whenever the Purchaser exercises a right, election, demand or option under
a Transaction Document and the Company does not timely perform its related obligations within the periods therein provided, then
the Purchaser may rescind or withdraw, in its sole discretion from time to time upon written notice to the Company, any relevant
notice, demand or election in whole or in part without prejudice to its future actions and rights; provided, however,
that in the case of a rescission of a conversion of a Debentures, the Purchaser shall be required to return any shares of Common
Stock subject to any such rescinded conversion or exercise notice.

 

5.14
Replacement of Securities. If any certificate or instrument evidencing any Securities is mutilated, lost, stolen or destroyed,
the Company shall issue or cause to be issued in exchange and substitution for and upon cancellation thereof (in the case of mutilation),
or in lieu of and substitution therefor, a new certificate or instrument, but only upon receipt of evidence reasonably satisfactory
to the Company of such loss, theft or destruction. The applicant for a new certificate or instrument under such circumstances
shall also pay any reasonable third-party costs (including customary indemnity) associated with the issuance of such replacement
Securities.

 

    	 		 

    	 

    

 

5.15
Remedies. In addition to being entitled to exercise all rights provided herein or granted by law, including recovery of
damages, each of the Purchaser and the Company will be entitled to specific performance under the Transaction Documents. The parties
agree that monetary damages may not be adequate compensation for any loss incurred by reason of any breach of obligations contained
in the Transaction Documents and hereby agrees to waive and not to assert in any action for specific performance of any such obligation
the defense that a remedy at law would be adequate.

 

5.16
Payment Set Aside. To the extent that the Company makes a payment or payments to the Purchaser pursuant to any Transaction
Document or the Purchaser enforces or exercises its rights thereunder, and such payment or payments or the proceeds of such enforcement
or exercise or any part thereof are subsequently invalidated, declared to be fraudulent or preferential, set aside, recovered
from, disgorged by or are required to be refunded, repaid or otherwise restored to the Company, a trustee, receiver or any other
person under any law (including, without limitation, any bankruptcy law, state or federal law, common law or equitable cause of
action), then to the extent of any such restoration the obligation or part thereof originally intended to be satisfied shall be
revived and continued in full force and effect as if such payment had not been made or such enforcement or setoff had not occurred.

 

5.17
Usury. To the extent it may lawfully do so, the Company hereby agrees not to insist upon or plead or in any manner whatsoever
claim, and will resist any and all efforts to be compelled to take the benefit or advantage of, usury laws wherever enacted, now
or at any time hereafter in force, in connection with any claim, action or proceeding that may be brought by the Purchaser in
order to enforce any right or remedy under any Transaction Document. Notwithstanding any provision to the contrary contained in
any Transaction Document, it is expressly agreed and provided that the total liability of the Company under the Transaction Documents
for payments in the nature of interest shall not exceed the maximum lawful rate authorized under applicable law (the “Maximum
Rate”), and, without limiting the foregoing, in no event shall any rate of interest or default interest, or both of them,
when aggregated with any other sums in the nature of interest that the Company may be obligated to pay under the Transaction Documents
exceed such Maximum Rate. It is agreed that if the maximum contract rate of interest allowed by law and applicable to the Transaction
Documents is increased or decreased by statute or any official governmental action subsequent to the date hereof, the new maximum
contract rate of interest allowed by law will be the Maximum Rate applicable to the Transaction Documents from the effective date
forward, unless such application is precluded by applicable law. If under any circumstances whatsoever, interest in excess of
the Maximum Rate is paid by the Company to the Purchaser with respect to indebtedness evidenced by the Transaction Documents,
such excess shall be applied by the Purchaser to the unpaid principal balance of any such indebtedness or be refunded to the Company,
the manner of handling such excess to be at the Purchaser’s election.

 

5.18
Liquidated Damages. The Company’s obligations to pay any partial liquidated damages or other amounts owing under
the Transaction Documents is a continuing obligation of the Company and shall not terminate until all unpaid partial liquidated
damages and other amounts have been paid notwithstanding the fact that the instrument or security pursuant to which such partial
liquidated damages or other amounts are due and payable shall have been canceled.

 

    	 		 

    	 

    

 

5.19
Saturdays, Sundays, Holidays, etc. If the last or appointed day for the taking of any action or the expiration of any right
required or granted herein shall not be a Business Day, then such action may be taken or such right may be exercised on the next
succeeding Business Day.

 

5.20
Construction. The parties agree that each of them and/or their respective counsel has reviewed and had an opportunity to
revise the Transaction Documents and, therefore, the normal rule of construction to the effect that any ambiguities are to be
resolved against the drafting party shall not be employed in the interpretation of the Transaction Documents or any amendments
hereto.

 

5.21
WAIVER OF JURY TRIAL. IN ANY ACTION, SUIT, OR PROCEEDING IN ANY JURISDICTION BROUGHT BY ANY PARTY AGAINST ANY OTHER
PARTY, THE PARTIES EACH KNOWINGLY AND INTENTIONALLY, TO THE GREATEST EXTENT PERMITTED BY APPLICABLE LAW, HEREBY ABSOLUTELY, UNCONDITIONALLY,
IRREVOCABLY AND EXPRESSLY WAIVES FOREVER TRIAL BY JURY.

 

(Signature
Pages Follow)

 

    	 		 

    	 

    

 

IN
WITNESS WHEREOF, the parties hereto have caused this Securities Purchase Agreement to be duly executed by their respective authorized
signatories as of the date first indicated above.

 

THE
CHRON ORGANIZATION, INC. 

 

	By:	/s/
    Alex Rodriguez	 
	Name:	Alex
    Rodriguez	 
	Title:	CEO	 

 

	By:
    	 	 
	Name:	 	 
	Title:	 	 

 

	EMAIL
    ADDRESS FOR NOTICE 	 	 

 

With
a copy to (which shall not constitute notice):

 

[REMAINDER
OF PAGE INTENTIONALLY LEFT BLANK

SIGNATURE
PAGE FOR PURCHASER FOLLOWS]

 

    	 		 

    	 

    

 

[PURCHASER
SIGNATURE PAGES TO THE CHRON ORGNAIZATION, INC. SECURITIES PURCHASE AGREEMENT]

 

IN
WITNESS WHEREOF, the undersigned have caused this Securities Purchase Agreement to be duly executed by their respective authorized
signatories as of the date first indicated above.

 

	Name
    of Purchaser: Bellridge Capital, LLC	 
	Signature
    of Authorized Signatory of Purchaser: 	/s/
    Robert Klimov
	Name
    of Authorized Signatory: Robert Klimov	 
	Title
    of Authorized Signatory: Managing Partner	 
	Email
    Address of Authorized Signatory: 	 
	Facsimile
    Number of Authorized Signatory: 	 

 

Address
for Notice of Purchaser:

 

Address
for Delivery of Securities for Purchaser (if not same as address for notice):

 

EIN
Number: [PROVIDE THIS UNDER SEPARATE COVER]

 

    	 		 

    	 

    

 

Annex
A

 

CLOSING
STATEMENT

 

Pursuant
to the attached Securities Purchase Agreement, dated as of the date hereto, the purchaser shall purchase an aggregate of $165,000
Original Discount Debentures from The Chron Organization, Inc., a Nevada corporation (the “Company”) for a purchase
price of an aggregate of up to $150,000. The Purchase Directs that the funds for the purchase of $82,500 Debenture for a purchase
price of $75,000 be disbursed as follows:

 

First
Closing

 

Disbursement
Date: March __, 2017

 

	I. FACE AMOUNT OF DEBENTURE 	 	$	82,500	 
	 	 	 	 	 
	Less: OID	 	 	(7,500	)
	 	 	 	 	 
	II. DISBURSEMENTS	 	 	 	 
	 	 	 	 	 
	Total Amount Disbursed:	 	$	75,000	 

 

WIRE
INSTRUCTIONS:

Bank:
Bank of America

Bank
Routing #: 026009593

 

Account
Name: The Chron Organization, Inc.

Account
Address: 5851 Legacy Circle, Suite 600, Plano, TX 75024

Account
#: 4880 5973 0354

 

Second
Closing

 

Disbursement
Date: ___, 2017

 

	I. FACE AMOUNT
    OF DEBENTURE	 	$	82,500	 
	 	 	 	 	 
	Less: OID	 	 	(7,500	)
	 	 	 	 	 
	Legal Fees	 	 	(5,000	)

	Gross Proceeds to be Received	 	 	 	 

 

	II. DISBURSEMENTS	 	 	 	 
	 	 	 	 	 
	Total Amount Disbursed:	 	$	70,000	 

 

WIRE
INSTRUCTIONS:

 

Bank:
Bank of America

Bank
Routing #: 026009593

 

Account
Name: The Chron Organization, Inc.

Account
Address: 5851 Legacy Circle, Suite 600, Plano, TX 75024

Account
#: 4880 5973 0354

 

[additional
disbursements to be inserted]

 

(Signature
Pages Follow)

 

    	 		 

    	 

    

 

THE
CHRON ORGANIZATIONI, INC. 

 

	By:
    	 	 
	Name:	 	 
	Title:	 	 
	 	 	 
	By:
    	 	 
	Name:	 	 
	Title:	 	 

 

    	 		 

    	 

    

 

Schedule
3.1(a)

Wholly
owned Subsidiaries

 

The
Company has two wholly owned Subsidiaries as follows:

 

Zen
Energy, Inc., a Texas corporation, incorporated June 1, 2016 with 1,000,000 shares of no par value common stock authorized, Texas
filing #802470038

 

Zen
Technologies, Inc., a Texas corporation, incorporated May 31, 2016 with 1,000,000 shares of no par value common stock authorized,
Texas filing #802469065

 

Schedule
3.1(g)

Capitalization
Table

 

The
capitalization of the Company immediately prior to Closing is, as follows:

 

Class
A Common Stock, 1,450,000,000 authorized

 

	Issued and Outstanding	 	 	874,307,570	 
	Reserved for Issuance:	 	 	 	 
	Convertible Promissory Notes	 	 	25,000,000	 
	Related Party Convertible Notes	 	 	64,333,333	 
	Warrants	 	 	10,000,000	 
	Related Party Warrants	 	 	32,166,667	 
	Fully Diluted	 	 	1,005,807,570	 

 

Class
B Common Stock, 10,000,000 Authorized 

 

	Issued and Outstanding	 	 	10,000,000	 

 

Preferred
Stock, 40,000,000 Authorized

 

	Issued and Outstanding	 	 	-0-	 

 

    	 		 

    	 

    

 

Exhibit
A

Form
of Convertible Debenture

 

    	 		 

    	 

    

 

Exhibit
B

 

Form
of Warrant

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