Document:

Exhibit 10.16cc

 

Restricted Stock Unit Agreement

for Employees other than Executive Officers Under

The Estée Lauder Companies Inc.

Amended and Restated Fiscal 2002 Share Incentive Plan (the “Plan”)

 

This RESTRICTED STOCK UNIT AGREEMENT (“Agreement”) provides for the granting by The Estée Lauder Companies Inc., a Delaware corporation (the “Company”), to the participant, an employee of the Company or one of its subsidiaries (the “Participant”), of Stock Units under the Plan representing a notional account equal to a corresponding number of shares of the Company’s Class A Common Stock, par value $0.01 (the “Shares”), subject to the terms below (the “Restricted Stock Units”). The name of the “Participant,” the “Grant Date” (or “Award Date”), the “Number of Restricted Stock Units,” the “Vesting Schedule,” and the “Vesting Period” are stated in the “Notice of Grant” attached or posted electronically together with this Agreement and are incorporated by reference. The other terms of this award are stated in this Agreement and in the Plan. Terms not defined in this Agreement are defined in the Plan, as amended. The Plan is referred to as the “Grant Plan” in the electronic Notice of Grant.

 

1.            Award Grant. The Company hereby awards to the Participant an award of Restricted Stock Units in respect of the number of Shares set forth in the Notice of Grant.

 

2.            Vesting. The Restricted Stock Units granted to the Participant will vest and become payable in accordance with the Vesting Schedule set forth in the Notice of Grant. This schedule indicates the vesting date upon which the Participant will be entitled to receive Shares. Except as otherwise provided in this Agreement, any Restricted Stock Units that are unvested when the Participant terminates employment with the Company or any of its subsidiaries will be forfeited.

 

3.            Payment of Awards.

 

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(a)               Each Restricted Stock Unit represents the right to receive one (1) Share when the Restricted Stock Unit vests.

 

(b)              In addition, each Restricted Stock Unit carries a Dividend Equivalent Right, payable in Shares, the amount of which is based on the number of Shares that could be purchased with the dividend amount. The Dividend Equivalent Rights shall be payable at the same time as payment of Restricted Stock Units in accordance with this Section 3 and Section 4. Notwithstanding anything to the contrary herein, if, prior to the vesting in full of this Restricted Stock Unit award, the Participant becomes required to file reports under Section 16 of the U.S. Securities Exchange Act of 1934 in connection with Company securities, then any Dividend Equivalent Rights earned after such date shall accrue and be payable in cash at the same time as payment of Restricted Stock Units in Shares in accordance with this Section 3 and Section 4. Dividend Equivalent Rights are deemed part of the related Restricted Stock Units under this Agreement.

 

(c)               In the event of a Change in Control that constitutes a “change in control event” within the meaning of Section 409A of the Code, the Company may, in its sole discretion and in accordance with Treasury Regulation § 1.409A-3(j)(4)(ix)(B), vest and settle the Restricted Stock Units and terminate this Agreement. In such event, settlement of the Restricted Stock Units shall be made within two (2) weeks following the Change in Control. In the event that Restricted Stock Units are not settled pursuant to the immediately preceding sentence, such Restricted Stock Units shall be assumed by an acquirer in which case, vesting will be subject to Sections 2 and 4. If the Shares cease to be outstanding immediately after the Change in Control (e.g., due to a merger with and into another entity), then the consideration to be received per Share will equal the consideration paid to each shareholder per Share generally upon the Change in Control.

 

(d)             Any dividends or other distributions on Shares received after vesting of the Restricted Stock Units, after applicable withholding, that are held in an account for the Participant at the agent engaged by the Company for the purposes of holding the Shares for the Participant upon Vesting (the “Agent”), will be automatically reinvested by default, in accordance with the Agent’s applicable procedures, in additional whole and/or fractional Shares. If the Participant does not wish to have dividends or other distributions reinvested or if the Participant would like to change a current election, the Participant must notify the Agent prior to the record date for such dividend or distribution (or such earlier date as may be required by the Agent).

 

4.            Termination of Employment. If the Participant’s employment terminates during the Vesting Period, all unvested Restricted Stock Units will be forfeited except as follows, subject to Section 3:

 

(a)               Death. If the Participant dies, unvested Restricted Stock Units will vest on the date of death pro rata based on the number of full months the Participant was paid salary during the Vesting Period after the last vesting date (i.e., the proration equals a fraction, the numerator of which is the number of full calendar months of service completed during the Vesting Period after the last vesting date through the Participant’s death and the denominator of which is the number of full calendar months after the last vesting date that are remaining in the Vesting Period). For this purpose, “last vesting date” is the Grant Date if the first vesting date has not yet occurred. Payment of the vested Restricted Stock Units will occur

 

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on the seventy-fifth (75th) day following the Participant’s death and in accordance with any applicable laws or Company procedures regarding the payments. Notwithstanding anything to the contrary contained in this section 4(a), if the Participant dies during active employment after the attainment of age fifty-five (55) and the completion of ten (10) or more years of service, or after the attainment of age sixty-five (65) and the completion of five (5) or more years of service, without formally retiring under the terms of the Estée Lauder Inc. Retirement Growth Account Plan (or an affiliate or a successor plan or program of similar purpose), unvested Restricted Stock Units will continue to vest and be paid in accordance with the Vesting Schedule to the Participant’s beneficiaries.

 

(b)              Retirement. If the Participant formally retires under the terms of The Estée Lauder Companies Retirement Growth Account Plan (or an affiliate or a successor plan or program of similar purpose), the unvested Restricted Stock Units will continue to vest and be paid in accordance with the Vesting Schedule. Vesting and payment in respect of any unvested Restricted Stock Unit after retirement will be subject to satisfaction of the conditions precedent that the Participant neither (i) accepts an offer to work for, or otherwise agrees to actively participate in or render services to any business on behalf of any competitor of the Company, any of its subsidiaries, or affiliates (whether as an employee, consultant or otherwise); nor (ii) conducts himself or herself in a manner adversely affecting the Company. The term “competitor” means any business that is engaged in, or is preparing to become engaged in, the makeup, skin care, hair care, toiletries or fragrance business or other business in which the Company is engaged or preparing to become engaged, or that otherwise competes with, or is preparing to compete with, the Company. Notwithstanding anything to the contrary contained in this section 4(b), if the Participant terminates employment by reason of retirement within six (6) months of the Grant Date, the Restricted Stock Units shall not vest and shall become null and void on the last day of active employment (last day worked).

 

(c)               Disability. If the Participant becomes totally and permanently disabled (as determined under the Company’s long-term disability program, or an affiliate or a successor plan or program of similar purpose), the unvested Restricted Stock Units will vest pro rata for each full month in which the Participant is paid salary during the Vesting Period (determined under the proration methodology in Section 4(a)) on the next vesting date during the Vesting Period. The vested Restricted Stock Units will be paid on the next vesting date during the Vesting Period. Notwithstanding anything to the contrary contained in this Section 4(c), if the Participant becomes totally and permanently disabled (as determined under the Company’s long-term disability program) during active employment after the attainment of age fifty-five (55) and the completion of ten (10) or more years of service, or after the attainment of age sixty-five (65) and the completion of five (5) or more years of service, without formally retiring under the terms of the Estée Lauder Inc. Retirement Growth Account Plan (or an affiliate or a successor plan or program of similar purpose), unvested Restricted Stock Units will continue to vest and be paid in accordance with the Vesting Schedule.

 

(d)             Termination of Employment Without Cause. If the Participant’s employment is terminated by the Company or relevant subsidiary without Cause (as defined below), any unvested Restricted Stock Units will vest pro rata for each full month in which the Participant is paid salary during the Vesting Period after the last vesting date (determined under the proration

 

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methodology in Section 4(a)) on the next vesting date during the Vesting Period. Such prorated Restricted Stock Units will be paid in accordance with the Vesting Schedule and payment will be subject to satisfaction of the conditions precedent that the Participant neither (i) accepts an offer to work for, or otherwise agrees to actively participate in or render services to any business on behalf of any competitor of the Company, any of its subsidiaries, or affiliates (whether as an employee, consultant or otherwise); nor (ii) conducts himself or herself in a manner adversely affecting the Company. The term “competitor” means any business that is engaged in, or is preparing to become engaged in, the makeup, skin care, hair care, toiletries or fragrance business or other business in which the Company is engaged or preparing to become engaged, or that otherwise competes with, or is preparing to compete with, the Company. Notwithstanding anything to the contrary contained in this Section 4(d), if the Participant’s employment is terminated without Cause within six (6) months of the Grant Date, the Restricted Stock Units shall not vest and shall become null and void on the last day of active employment (last day worked).

 

(e)               Resignation. If the Participant voluntarily terminates his or her employment (e.g., by voluntarily resigning) other than due to retirement or disability, which are subject to Sections 4(b) and 4(c) above, respectively, all Restricted Stock Units that are not vested as of the effective date of resignation will be forfeited.

 

(f)                Termination of Employment with Cause. If the Participant is terminated for Cause, all Restricted Stock Units that are not vested as of the effective date of the termination will be forfeited. For this purpose, “Cause” means any breach by the Participant of any of his or her material obligations under any Company policy or procedure, including, without limitation, the Code of Conduct. Notwithstanding the foregoing, in the case of a Participant who has an employment agreement that includes a definition of “Cause,” “Cause” for purposes of this Section 4(f) shall have the same meaning as defined in such employment agreement in effect between the Participant and the Company or its U.S. subsidiary, including an employment agreement entered into after the Grant Date.

 

(g)            Termination after a Change in Control. If, on or after a Change in Control, the Participant terminates for Good Reason (as defined below), dies, becomes disabled, formally retires, or is terminated at the instance of the Company or relevant subsidiary without Cause, in each case as described in this Section 4, the unvested Restricted Stock Units will immediately vest in full and, solely if such Change in Control constitutes a “change in control event” within the meaning of Section 409A of the Code and such termination occurs within two (2) years of such “change in control event,” will be immediately paid. Otherwise, such Restricted Stock Units will immediately vest, but will only be paid at such times as they would otherwise be paid in accordance with this Agreement. For this purpose, “Good Reason” means the occurrence of any of the following, without the express written consent of the Participant:

 

(i)                  the assignment to the Participant of any duties inconsistent in any material adverse respect with the Participant’s position, authority or responsibilities immediately prior to the Change in Control, or any other material adverse change in such position, including title, authority or responsibilities;

 

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(ii)              any failure by the Company to pay any amounts for compensation or benefits owed to the Participant or a material reduction of the overall amounts of compensation and benefits in effect prior to the Change in Control, other than an insubstantial or inadvertent failure remedied by the Company promptly after receipt of notice thereof given by the Participant;

 

(iii)          the Company’s requiring the Participant to be based at any office or location more than fifty (50) miles (eighty (80) Kilometers) from that location at which he performed his or her services for the Company immediately prior to the Change in Control, except for travel reasonably required in the performance of the Participant’s responsibilities; or

 

(iv)          any failure by the Company to obtain the assumption and agreement to perform this Agreement by a successor, unless such assumption occurs by operation of law.

 

5.            No Rights of Stock Ownership. This grant of Restricted Stock Units does not entitle the Participant to any interest in or to any voting or other rights normally attributable to Share ownership.

 

6.            Withholding Taxes. Regardless of any action the Company or the Participant’s employer (the “Employer”) takes with respect to any or all income tax, social security (or social insurance), payroll tax, fringe benefits tax, payment on account or other tax-related items related to the participation in the Plan and this Agreement and legally applicable to the Participant (“Tax-Related Items”), the Participant acknowledges that the ultimate liability for all Tax-Related Items legally due by the Participant is and remains his or her responsibility and may exceed the amount actually withheld by the Company or the Employer. Furthermore, the Participant acknowledges that the Company and/or the Employer (i) make no representations or undertakings regarding the treatment of any Tax-Related Items in connection with any aspect of the Restricted Stock Units, including, but not limited to, the grant, vesting or settlement of the Restricted Stock Units, the subsequent sale of Shares acquired under the Plan and the receipt of any dividends and/or any Dividend Equivalent Rights, and (ii) do not commit to and are under no obligation to structure the terms of the grant of the Restricted Stock Units or any aspect of the Participant’s participation in the Plan to reduce or eliminate his or her liability for Tax-Related Items or achieve any particular tax result. If the Participant is or becomes subject to Tax-Related Items in more than one jurisdiction, the Participant acknowledges that the Company and/or the Employer (or former employer, as applicable) may be required to withhold or account for Tax-Related Items in more than one jurisdiction.

 

Prior to any relevant taxable event, or tax withholding event, as applicable, the Participant agrees to pay or make adequate arrangements satisfactory to the Company and/or the Employer to satisfy all withholding obligations of the Company and/or the Employer. In this regard, the Participant authorizes the Company and/or the Employer, or his or her respective agents, at the Company’s discretion, to satisfy any applicable withholding obligations with regard to all Tax-Related Items by one or a combination of the following: (i) withholding from the Participant’s wages or other cash compensation paid by the Company and/or the Employer; (ii) withholding from proceeds of the sale of the Shares acquired upon settlement of the Restricted Stock Units either through a voluntary sale or through a mandatory sale arranged by the Company (on the Participant’s behalf pursuant to this authorization); and/or (iii) withholding in whole Shares to be issued upon settlement of the Restricted Stock Units, provided that the Company only withholds the amount of whole Shares necessary to satisfy the statutory withholding requirements, not to exceed the maximum withholding tax rate in the Participant’s

 

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applicable jurisdiction. If the Company satisfies the withholding obligation for the Tax-Related Item by withholding a number of Shares as described herein, the Participant will be deemed to have been issued the full number of Shares due to Participant at vesting, notwithstanding that a number of Shares is held back solely for purpose of paying the Tax-Related Items.

 

Finally, the Participant further agrees to pay to the Company or the Employer any amount of Tax-Related Items that the Company or the Employer may be required to withhold or account for as a result of his or her participation in the Plan that cannot be satisfied by the means previously described. The Company may refuse to issue or deliver the Shares or the proceeds of the sale of Shares, if the Participant fails to comply with his or her obligations in connection with the Tax-Related Items.

 

7.            Nonassignability. This award may not be assigned, pledged, or transferred, except, if the Participant dies, to a designated beneficiary or by will or by the laws of descent and distribution. The foregoing restrictions do not apply to transfers under a court order, including, but not limited to, any domestic relations order.

 

8.            Effect Upon Employment. The Participant’s right to continue to serve the Company or any of its subsidiaries as an officer, employee, or otherwise, is not enlarged or otherwise affected by an award hereunder. Nothing in this Agreement or the Plan gives the Participant any right to continue in the employ of the Company or any of its subsidiaries to interfere in any way with any right the Company or any of its subsidiaries may have to terminate his or her employment at any time. Payment of Shares is not secured by a trust, insurance contract or other funding medium, and the Participant does not have any interest in any fund or specific asset of the Company by reason of this award or the account established on his or her behalf. A Restricted Stock Unit award confers no rights as a shareholder of the Company until Shares are actually delivered to the Participant.

 

9.            Electronic Notice, Delivery and Acceptance. The Company may, in its sole discretion, decide to deliver any documents related to Restricted Stock Units awarded under the Plan or future Restricted Stock Units that may be awarded under the Plan by email or other electronic means. The Participant hereby consents to receive such documents by email or other electronic delivery and agrees to access information concerning the Plan through an on-line or electronic system established and maintained by the Company or by another third party designated by the Company.

 

10.    Data Privacy. As a condition of this Restricted Stock Unit grant, the Participant hereby expressly consents to the collection, use, disclosure, transfer and other processing of his or her personal data as set out in this Section 10 and as otherwise required by applicable law.

 

The Company, any of its subsidiaries, affiliates, or agents, the Employer, and the Company’s stock plan service provider will process personal data of the Participant for the purposes of implementing, managing and administering the Participant’s grant of Restricted Stock Units and the Plan. Such personal data, in electronic or other form, may include the Participant’s name, home address, telephone number, email address, date of birth, social insurance number or other national identification number, beneficiary information (including beneficiary name, address social insurance number or other national identification number, and date of birth), hire date, salary and deductions, banking details, tax certification information, any shares or directorships held in the Company, details of all equity grants or any other entitlement to Shares awarded, canceled, vested, unvested, or outstanding in the Participant’s favor.

 

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For the purposes set out above, personal data may be transferred to countries other than the country in which the Participant resides, including to the United States and Australia. As required by applicable law, when personal data is transferred to a country outside of the country in which the Participant resides, measures will be put in place to ensure that the personal data is protected as required by law. These measures may include European Union Standard Contractual Clauses.

 

The Participant’s personal data will be retained for as long as necessary to implement, manage and administer the Participant’s grant of Restricted Stock Units and participation in the Plan. The Participant may request to access, modify or delete his or her personal data, request additional information about the processing of his or her personal data, or refuse or withdraw consent to the processing of his or her personal data by contacting the local human resources representative in writing. Refusal or withdrawal of consent may affect the Participant’s ability to participate in the Plan but will not affect the Participant’s employment status or service and career with the Company.

 

11.    Discretionary Nature and Acceptance of Award. The Participant agrees to be bound by the terms of this Agreement and acknowledges, understands and agrees that:

 

a.             The Plan is established voluntarily by the Company, it is discretionary in nature, and it may be modified, amended, suspended or terminated by the Company at any time, unless otherwise provided in the Plan and this Agreement;

 

b.            The award is exceptional, voluntary and occasional, and does not create any contractual or other right to receive future awards, or benefits in lieu of Restricted Stock Units, even if Restricted Stock Units have been awarded in the past;

 

c.             All decisions with respect to future Restricted Stock Units or other awards, if any, will be at the sole discretion of the Company;

 

d.           The Participant’s participation in the Plan is voluntary;

 

e.             The Restricted Stock Units and any Shares acquired under the Plan, and the income and value of the same, are not intended to replace any pension rights or compensation;

 

f.              The Participant’s participation in the Plan shall not create a right to further employment with the Employer and shall not interfere with the ability of the Company or the Employer to terminate the Participant’s employment at any time;

 

g.            This award will be deemed accepted unless it is declined by way of written notice by the Participant within thirty (30) days of the Grant Date to the Equity Based Compensation Department of the Company located at 767 Fifth Avenue, New York, NY 10153;

 

h.            The Restricted Stock Units are an extraordinary item that does not constitute compensation of any kind for services of any kind rendered to the Company or any of its subsidiaries, and which is outside the scope of the Participant’s employment or service contract, if any;

 

i.                The Restricted Stock Units and any Shares acquired under the Plan, and the income and value of the same, are not part of the Participant’s normal or expected compensation or salary for any purposes,

 

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including, but not limited to, calculating any severance, resignation, termination, redundancy, dismissal end of service payments, bonuses, holiday pay, long-service awards, pension or retirement or welfare benefits or similar payments and in no event should be considered as compensation for, or relating in any way to, past services for the Employer, the Company or any of its subsidiaries;

 

j.                In the event the Participant is not an employee of the Company, the Restricted Stock Units and the Participant’s participation in the Plan will not be interpreted to form an employment or service contract or relationship with the Company or any subsidiary of the Company;

 

k.            The future value of the underlying Shares is unknown, indeterminable and cannot be predicted with certainty;

 

l.                In consideration of the award, no claim or entitlement to compensation or damages shall arise from forfeiture of the Restricted Stock Units or diminution in value of the Restricted Stock Units, or Shares acquired upon vesting of the Restricted Stock Units, resulting from termination of the Participant’s employment (for any reason whatsoever and whether or not later found to be invalid or in breach of employment laws in the jurisdiction where the Participant is employed, or the terms of the Participant’s employment), and in consideration of the award, the Participant irrevocably releases the Employer, the Company and any of its subsidiaries from any such claim that may arise; if, notwithstanding the foregoing, any such claim is found by a court of competent jurisdiction to have arisen, then, by acknowledging and agreeing to or signing the Notice of Grant, the Participant shall be deemed irrevocably to have waived his or her right to pursue or seek remedy for any such claim or entitlement against the Employer, the Company or subsidiary;

 

m.        For purposes of the Restricted Stock Units, the Participant’s employment or service relationship will be considered terminated as of the date the Participant is no longer actively providing services to the Employer, the Company or any of its subsidiaries as determined by the Administrator in its sole discretion (regardless of the reason for such termination and whether or not later found to be invalid or in breach of employment laws in the jurisdiction where the Participant is employed or the terms of the Participant’s employment agreement, if any);

 

n.            The Company is not providing any tax, legal or financial advice, nor is the Company making any recommendations regarding the Participant’s participation in the Plan or the Participant’s acquisition or sale of the underlying Shares; and

 

o.            The Participant is hereby advised to consult with Participant’s own personal tax, legal and financial advisors regarding the Participant’s participation in the Plan before taking any action related to the Plan.

 

12.    Failure to Enforce Not a Waiver. The Company’s failure to enforce at any time any provision of this Agreement does not constitute a waiver of that provision or of any other provision of this Agreement.

 

13.    Governing Law. This Agreement is governed by and is to be construed according to the laws of the State of New York, that apply to agreements made and performed in that state, without regard to its choice of law provisions. For purposes of litigating any dispute that arises under the Restricted Stock Units or this Agreement, the parties hereby submit to and consent to the jurisdiction of the State of New York, and agree that such litigation will be conducted in the courts of New York County, New York, or

 

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the federal courts for the United States for the Southern District of New York, and no other courts, where the Restricted Stock Units are made and/or to be performed.

 

14.    Partial Invalidity. The invalidity or illegality of any provision of this Agreement will be deemed not to affect the validity of any other provision. Furthermore, it is the parties’ intent that any order striking any portion of this Agreement and/or the Plan should modify the stricken terms as narrowly as possible to give as much effect as possible to the intentions of the parties hereunder.

 

15.    Entire Agreement. This Agreement and the Plan constitute the entire agreement between the Participant and the Company regarding the award and supersede all prior and contemporaneous agreements and understandings, oral or written, between the parties regarding the award. Except as expressly set forth herein, this Agreement (and any provision of this Agreement) may not be modified, changed, clarified, or interpreted by the parties, except in a writing specifying the modification, change, clarification, or interpretation, and signed by a duly authorized Company officer.

 

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16.    Section 409A Compliance. This Agreement is intended to comply with Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”), and any regulations, rulings, or guidance provided thereunder. Each payment under this Agreement shall be treated as a separate payment for purposes of Section 409A of the Code. In no event may the Participant, directly or indirectly, designate the calendar year of any payment to be made under this Agreement. The Company reserves the unilateral right to amend this Agreement upon written notice to the Participant in order to prevent taxation under Section 409A of the Code.

 

17.    Recoupment. Notwithstanding any other provision of this Agreement to the contrary, the Participant acknowledges and agrees that the Restricted Stock Units, any Shares acquired pursuant thereto and/or any amount received with respect to any sale of such Shares are subject to potential cancellation, recoupment, rescission, payback or other action in accordance with the terms of the Company’s recoupment policy as in effect on the Grant Date and as such policy may be amended from time to time in order to comply with changes in laws, rules or regulations that are applicable to the Restricted Stock Units and Shares. The Participant agrees and consents to the Company’s application, implementation and enforcement of (a) the recoupment policy, and (b) any provision of applicable law relating to cancellation, recoupment, rescission or payback of compensation and expressly agrees that the Company may take such actions as are necessary to effectuate the recoupment policy (as applicable to the Participant) or applicable law without further consent or action being required by the Participant. For purposes of the foregoing, the Participant expressly and explicitly authorizes the Company to issue instructions, on his or her behalf, to any brokerage firm and/or third party administrator engaged by the Company to hold his or her Shares and other amounts acquired under the Plan to re-convey, transfer or otherwise return such Shares and/or other amounts to the Company upon the enforcement of the provisions contained in this Section 17. To the extent that the terms of this Agreement and the recoupment policy conflict, the terms of the recoupment policy shall prevail.

 

18.    Insider Trading/Market Abuse Laws. By participating in the Plan, the Participant agrees to comply with the Company’s Insider Trading Policy. Further, the Participant acknowledges that the Participant’s country of employment (and country of residence, if different) may also have laws or regulations governing insider trading and that such laws or regulations may impose additional restrictions on the Participant’s ability to participate in the Plan (e.g., acquiring or selling Shares) and that the Participant is solely responsible for complying with such laws or regulations.

 

19.    Private Placement. The grant of the Restricted Stock Units is not intended to be a public offering of securities in the Participant’s country of employment (and country of residence, if different). The Company has not submitted any registration statement, prospectus or other filings with the local securities authorities (unless otherwise required under law), and this grant of Restricted Stock Units is not subject to the supervision of the local authorities.

 

20.    Exchange Control, Tax and/or Foreign Asset/Account Reporting. The Participant acknowledges that there may be exchange control, tax, foreign asset and/or account reporting requirements that may affect the Participant’s ability to acquire or hold Shares acquired under the Plan or cash received from participating in the Plan (including from any Dividend Equivalents Rights paid with respect to the Restricted Stock Units or dividends paid on Shares acquired under the Plan) in a brokerage/bank account or legal entity outside the Participant’s country of employment (and country of residence, if different). The Participant may be required to report such accounts, assets, the balances therein, the value thereof and/or the transactions related thereto to the tax or other authorities in the Participant’s

 

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country of employment (and country of residence, if different). The Participant also may be required to repatriate sale proceeds or other funds received as a result of the Participant’s participation in the Plan to the Participant’s country of employment (and country of residence, if different) through a designated bank or broker within a certain time after receipt. The Participant acknowledges that it is the Participant’s responsibility to be compliant with such regulations, and the Participant should consult his or her personal legal advisor for any details.

 

21.    Language. If the Participant has received this Agreement or any other document related to the Plan translated into a language other than English and if the translated version is different than the English version, the English version will control, unless otherwise prescribed by local law.

 

22.    Imposition of Other Requirements. The Company reserves the right to impose other requirements on the Participant’s participation in the Plan, on the Restricted Stock Units and on any Shares acquired under the Plan, to the extent the Company determines it is necessary or advisable for legal or administrative reasons, and to require the Participant to sign any additional agreements or undertakings that may be necessary to accomplish the foregoing.

 

23.    Addendum. The award shall be subject to any terms and conditions for the Participant’s country of employment (and country of residence, if different) set forth in an addendum attached hereto (“Addendum”). Moreover, if the Participant transfers residence and/or employment to another country reflected in an Addendum to this Agreement, the terms and conditions for such country will apply to the Participant to the extent the Company determines that the application of such terms and conditions is necessary or advisable in order to comply with local law, rules and regulations or to facilitate the operation and administration of the Restricted Stock Unit and the Plan (or the Company may establish alternative terms and conditions as may be necessary or advisable to accommodate the Participant’s transfer). Any applicable Addendum constitutes part of this Agreement.

 

IN WITNESS WHEREOF, the Company has caused this Agreement to be executed by its duly authorized officer as of the Grant Date set forth in the Notice of Grant.

 

	
 
    	
The Estée Lauder Companies Inc.
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Michael O’Hare
    	
 
    
	
 
    	
 
    	
Michael O’Hare
    	
 
    
	
 
    	
 
    	
Executive Vice President,
    	
 
    
	
 
    	
 
    	
Global Human Resources
    	
 
    

 

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ADDENDUM

COUNTRY-SPECIFIC PROVISIONS FOR NON-U.S. PARTICIPANTS

 

In addition to the terms and conditions set forth in the Agreement, the Restricted Stock Units awarded are subject to the following terms and conditions. If the Participant is employed in a country identified in this Addendum, the additional terms and conditions for such country will apply. If the Participant transfers to one of the countries identified in this Addendum, the special terms and conditions for such country will apply to the Participant, to the extent the Company determines, in its sole discretion, that the application of such terms and conditions is necessary or advisable to comply with local laws, rules and/or regulations or to facilitate the operation and administration of the Restricted Stock Units awarded and the Plan (or the Company may establish alternative terms and conditions as may be necessary or advisable to accommodate the Participant’s transfer).

 

All defined terms contained in this Addendum shall have the same meaning as set forth in the Plan and the Agreement.

 

ARGENTINA

 

Securities Law Notification. Neither the Restricted Stock Units nor the underlying Shares are publicly offered or listed on any stock exchange in Argentina. The Company’s grant of Restricted Stock Units is private and is not subject to the supervision of any Argentine governmental authority.

 

AUSTRALIA

 

Breach of Law. Notwithstanding anything to the contrary in the Agreement or the Plan, the Participant will not be entitled to, and shall not claim any benefit (including without limitation a legal right) under the Plan if the provision of such benefit would give rise to a breach of Part 2D.2 of the Corporations Act 2001 (Cth), any other provision of that Act, or any other applicable statute, rule or regulation which limits or restricts the giving of such benefits.

 

Tax Deferral. Restricted Stock Units awarded under the Agreement are intended to be subject to tax deferral under Subdivision 83A-C of the Income Tax Assessment Act 1997 (Cth) (subject to the conditions in that act).

 

Australian Offer Document. In addition to the Agreement and the Plan, the Participant must review the Australian Offer Document for additional important information pertaining to the Restricted Stock Units. By accepting the Restricted Stock Units, the Participant acknowledges and confirms that the Participant has reviewed these documents.

 

BRAZIL

 

Compliance with Law. By accepting the Restricted Stock Units, the Participant acknowledges and agrees to comply with applicable Brazilian laws to pay any and all applicable taxes associated with the vesting of the Restricted Stock Units, the receipt of any dividends or dividend equivalents, and the sale of Shares acquired under the Plan.

 

Labor Law Acknowledgment. The Participant expressly acknowledges and agrees, for all legal purposes, (a) the benefits provided under the Agreement and the Plan are the result of commercial

 

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transactions unrelated to the Participant’s employment; (b) the Agreement and the Plan are not a part of the terms and conditions of the Participant’s employment; and (c) the income from the Restricted Stock Units, if any, is not part of the Participant’s remuneration from employment.

 

CANADA

 

Settlement in Shares Only. Notwithstanding anything to the contrary in the Agreement or the Plan, if the Participant is a resident of Canada, all Restricted Stock Units shall be settled only in Shares (and may not be settled in cash).

 

English Language. The parties to the Agreement acknowledge that it is their express wish that the Agreement, as well as all documents, notices and legal proceedings entered into, given or instituted pursuant hereto or relating directly or indirectly hereto, be drawn up in English. Les parties reconnaissent avoir exigé la rédaction en anglais de la présente convention, ainsi que de tous documents exécutés, avis donnés et procédures judiciaires intentées, directement ou indirectement, relativement à ou suite à la présente convention.

 

CHILE

 

Private Placement. The following provision shall supplement Section 19 (Private Placement) of the Agreement:

 

The grant of the Restricted Stock Units hereunder is not intended to be a public offering of securities in Chile but instead is intended to be a private placement.

 

a) The starting date of the offer is the Grant Date (as defined in the Agreement), a) and this offer conforms to General Ruling no. 336 of the Chilean Superintendence of Securities and Insurance;

 

b) The offer deals with securities not registered in the registry of securities or in the registry of foreign securities of the Chilean Superintendence of Securities and Insurance, and therefore such securities are not subject to its oversight;

 

c) The Company is not obligated to provide public information in Chile regarding the foreign securities, as such securities are not registered with the Chilean Superintendence of Securities and Insurance; and

 

d) The foreign securities shall not be subject to public offering as long as they are not registered with the corresponding registry of securities in Chile.

 

a) La fecha de inicio de la oferta será el de la fecha de otorgamiento (o “Grant Date”, según este término se define en el documento denominado “Agreement”) y esta oferta se acoge a la norma de Carácter General n° 336 de la Superintendencia de Valores y Seguros Chilena; La oferta versa sobre valores no inscritos en el registro de valores o en el

 

b) registro de valores extranjeros que lleva la Superintendencia de Valores y Seguros Chilena, por lo que tales valores no están sujetos a la fiscalización de ésta;

 

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c) Por tratar de valores no inscritos no existe la obligación por parte del emisor de entregar en Chile información pública respecto de esos valores; y

 

d) Esos valores no podrán ser objeto de oferta pública mientras no sean inscritos en el registro de valores correspondiente.

 

CHINA

 

Foreign Exchange Control Laws. The following provisions shall govern the Participant’s participation in the Plan if the Participant is a national of the People’s Republic of China (“China”) resident in mainland China, or if determined to be necessary or appropriate by the Company in its sole discretion:

 

The Participant agrees to hold the Shares received upon settlement of the Restricted Stock Units with the Company’s designated broker. Upon a termination of employment or service for any reason, the Participant shall be required to sell all Shares issued pursuant to the Restricted Stock Units as soon as administratively possible (or such period as may be required by the State Administration of Foreign Exchange or the Company) of the termination date and repatriate the sales proceeds to China in the manner designated by the Company. For purposes of the foregoing, the Company shall establish procedures for effectuating the forced sale of the Shares (including procedures whereby the Company may issue sell instructions on behalf of the Participant), and the Participant hereby agrees to comply with such procedures and take any and all actions as the Company determines, in its sole discretion, are necessary or advisable for purposes of complying with local laws, rules and regulations in China.

 

The Participant understands and agrees that the repatriation of dividends and sales proceeds may need to be effected through a special exchange control account established by the Company or its subsidiaries, and the Participant hereby consents and agrees that dividends issued on Shares and sales proceeds from the sale of Shares acquired under the Plan may be transferred to such account by the Company on the Participant’s behalf prior to being delivered to the Participant. Dividends and/or sales proceeds may be paid to the Participant in U.S. dollars or local currency at the Company’s discretion. If dividends and/or sales proceeds are paid to the Participant in U.S. dollars, the Participant understands that the Participant will be required to set up a U.S. dollar bank account in China so that the dividends or proceeds may be deposited into this account. If dividends and/or sales proceeds are paid to the Participant in local currency, the Participant acknowledges that the Company is under no obligation to secure any particular exchange conversion rate and that the Company may face delays in converting the dividends and/or proceeds to local currency due to exchange control restrictions. The Participant agrees to bear any currency fluctuation risk between the time dividends are issued or Shares are sold and the net proceeds are converted into local currency and distributed to the Participant. The Participant further agrees to comply with any other requirements that may be imposed by the Company or its subsidiaries in China in the future in order to facilitate compliance with exchange control requirements in China. The Participant acknowledges and agrees that the processes and requirements set forth herein shall continue to apply following the Participant’s termination of employment.

 

Neither the Company nor any of its subsidiaries shall be liable for any costs, fees, lost interest or dividends or other losses the Participant may incur or suffer resulting from the enforcement of the terms of this Addendum or otherwise from the Company’s operation and enforcement of the Plan, the Agreement and the Restricted Stock Units in accordance with Chinese law including, without limitation, any applicable State Administration of Foreign Exchange rules, regulations and requirements.

 

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COLOMBIA

 

Labor Law Acknowledgment. The Participant acknowledges that, pursuant to Article 128 of the Colombian Labor Code, the Plan and related benefits do not constitute a component of his or her “salary” for any legal purpose.

 

DENMARK

 

Stock Option Act. Notwithstanding any provisions in the Agreement to the contrary, if the Participant is determined to be an “Employee,” as defined in section 2 of the Danish Act on the Use of Rights to Purchase or Subscribe for Shares etc. in Employment Relationships (the “Stock Option Act”), the treatment of the Restricted Stock Units upon Termination shall be governed by Sections 4 and 5 of the Stock Option Act. However, if the provisions in the Agreement or the Plan governing the treatment of the Restricted Stock Unit upon a Termination are more favorable, the provisions of the Agreement or the Plan will govern.

 

FRANCE

 

English Language. The Participant acknowledges and agrees that it is the Participant’s wish that the Agreement, this addendum, as well as all other documents, notices and legal proceedings entered into, given or instituted pursuant to the Restricted Stock Units, either directly or indirectly, be drawn up in English.

 

Langue anglaise. Le bénéficiaire admet et convient que c’est l’intention exprès du bénéficiaire que l’Accord, le Plan et tous les autres documents, remarque et les poursuites judiciaires entrées, données ou instituées conformément au Restricted Stock Units, être établi dans l’anglais. Si le bénéficiaire a reçu l’Accord, le Plan ou autres documents rattachés au Restricted Stock Units traduit dans une langue autre que l’anglais et si le sens de la version traduite est différent que la version anglaise, la version anglaise contrôlera

 

HONG KONG

 

IMPORTANT NOTICE. WARNING: The contents of the Agreement, this Addendum, the Plan, and all other materials pertaining to the Restricted Stock Units and/or the Plan have not been reviewed by any regulatory authority in Hong Kong. The Participant is hereby advised to exercise caution in relation to the offer thereunder. If the Participant has any doubts about any of the contents of the aforesaid materials, the Participant should obtain independent professional advice.

 

Settlement in Shares Only. Notwithstanding anything to the contrary in the Agreement or the Plan, if the Participant is a resident of Hong Kong, all Restricted Stock Units shall be settled only in Shares (and may not be settled in cash).

 

Nature of the Plan. The Company specifically intends that the Plan will not be treated as an occupational retirement scheme for purposes of the Occupational Retirement Scheme Ordinance (“ORSO”). To the extent any court, tribunal or legal/regulatory body in Hong Kong determines that the Plan constitutes an occupational retirement scheme for the purpose of ORSO, the grant of Restricted Stock Units shall be null and void.

 

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INDIA

 

Repatriation Requirements. The Participant understands that he or she must repatriate any cash dividends paid on Shares acquired under the Plan and any proceeds from the sale of such Shares to India within a certain period of time after receipt of the proceeds. It is the Participant’s sole responsibility to comply with applicable exchange control laws in India.

 

ISRAEL

 

Indemnification for Tax Liabilities. The Participant expressly consents and agrees to indemnify the Company and/or its subsidiaries and hold them harmless from any and all liability attributable to taxes, interest or penalties thereon, including without limitation, liabilities relating to the necessity to withhold any taxes from the settlement of the Restricted Stock Units or any other payments made to the Participant pursuant to the Restricted Stock Units.

 

ITALY

 

Data Privacy. The following provision shall replace Section 10 (Data Privacy) of the Agreement in its entirety:

 

The Participant understands that the Employer and/or the Company hold certain personal information about the Participant, including but not limited to, the Participant’s name, home address, email address and telephone number, date of birth, national insurance number or other identification number, salary, nationality, job title, any Shares or directorship held in the Company, details of all awards or other entitlement to Shares awarded, cancelled, vested, unvested or outstanding in the Participant’s favor (“Data”), for purpose of implementing, administering and managing the Plan. The Participant is aware that providing the Company with Data is necessary for the performance of the Agreement and that the Participant’s refusal to provide such Data would make it impossible for the Company to perform its contractual obligations and may affect the Participant’s ability to participate in the Plan.

 

The Controller of personal data processing is Estée Lauder Companies Inc., 767 Fifth Avenue, New York, New York 10153, U.S.A., its representative in Italy Estée Lauder S.r.l. with registered offices at Via Turati, 3, Milano, 20121 Italy. The Participant understands that Data may be transferred to third parties assisting in the implementation, administration and management of the Plan, including any transfer required to a broker or other third party with whom Shares acquired pursuant to this grant of Restricted Stock Units or cash from the sale of such Shares may be deposited. Furthermore, the recipients that may receive, possess, use, retain and transfer such Data for the above mentioned purposes may be located in the Participant’s country, or elsewhere, including outside of the European Union and the recipient’s country may have different data privacy laws and protections than the Participant’s country. The processing activity, including the transfer of the Participant’s personal data abroad, out of the European Union, as herein specified and pursuant to applicable laws and regulations, does not require the Participant’s consent thereto as the processing is necessary for the performance of contractual obligations related to the implementation, administration and management of the Plan. The Participant understands that Data processing relating to the purposes above specified shall take place under automated or non-automated conditions, anonymously when possible, that comply with the purposes for which Data are collected and with confidentiality and security provisions as set forth by applicable laws and regulations, with specific reference to D.lgs. 196/200

 

16

 

The Participant understands that Data will be held only as long as is required by law or as necessary to implement, administer and manage the Participant’s participation in the Plan. The Participant understands that, pursuant to art 7 of D.lgs 196/2003, the Participant has the right, including but not limited to, to access, delete, update, request the rectification of the Data and cease, for legitimate reasons, Data processing. Furthermore, the Participant is aware that Data will not be used for direct marketing purposes. In addition, the Data provided can be reviewed and questions or complaints can be addressed by contacting a local representative available at the following address, Via Turati, 3, Milano, 20121 Italy.

 

MALAYSIA

 

Data Privacy. The following provision shall replace Section 10 (Data Privacy) of the Agreement in its entirety:

 

	
The   Participant hereby explicitly and unambiguously consents to the collection,   use and transfer, in electronic or other form, of the Participant’s personal   data, as described in this addendum and any other grant materials by and   among, as applicable, the Company and Subsidiaries for the exclusive purpose   of implementing, administering and managing the Participant’s participation   in the Plan.

The   Participant understands that the Company and subsidiaries may hold certain   personal information about the Participant, including, but not limited to,   the Participant’s name, home address and telephone number, date of birth,   social insurance number or other identification number, e-mail address,   salary, nationality, job title, any Shares or directorships held in the   Company, details of all awards or any other entitlement to Shares awarded,   canceled, exercised, vested, unvested or outstanding in the Participant’s   favor, for the exclusive purpose of implementing, administering and managing   the Plan (“Data”). The Data is supplied by the Company and also by the   Participant through information collected in connection with the Agreement   and the Plan.

The   Participant understands that Data will be transferred to the current stock   plan service providers or a stock plan service provider as may be selected by   the Company in the future, which is assisting the Company with the
    	
Peserta dengan ini secara eksplisit dan   tanpa sebarang keraguan mengizinkan pengumpulan, penggunaan dan pemindahan,   dalam bentuk elektronik atau lain-lain, data peribadi seperti yang   diterangkan dalam Lampiran ini dan apa-apa bahan pemberian yang lain oleh dan   di antara, seperti yang berkenaan, Syarikat dan Anak-anak Syarikat untuk   tujuan eksklusif bagi melaksanakan, mentadbir dan menguruskan penyertaan   Peserta di dalam Pelan.

Peserta memahami bahawa Syarikat   Anak-anak Syarikat mungkin memegang maklumat peribadi tertentu tentang   Peserta, termasuk, tetapi tidak terhad kepada, nama Peserta, alamat rumah dan   nombor telefon, tarikh lahir, nombor insurans sosial atau nombor pengenalan   lain, e-mel, gaji, kewarganegaraan, jawatan, apa-apa Saham atau jawatan pengarah   yang dipegang dalam Syarikat, butir-butir semua Anugerah, atau apa-apa hak   lain atas Saham yang dianugerahkan, dibatalkan, dilaksanakan, terletak hak,   tidak diletak hak ataupun yang belum dijelaskan bagi faedahanda, untuk tujuan   eksklusif bagi melaksanakan, mentadbir dan menguruskan Pelan tersebut   (“Data”). Data tersebut dibekalkan oleh Syarikat dan juga oleh Peserta   berkenaan dengan Perjanjian dan Pelan.

Peserta memahami bahawa Data ini akan   dipindahkan kepada pembekal perkhidmatan pelan saham semasa atau pembekal
    	
 
    

 

17

 

	
implementation, administration and   management of the Plan. The Participant understands that the recipients of   Data may be located in the United States or elsewhere, and that the   recipients’ country (e.g., the United States) may have different data privacy   laws and protections than the Participant’s country. The Participant   understands that if the Participant resides outside the United States, the   Participant may request a list with the names and addresses of any potential   recipients of the Data by contacting the Participant’s local human resources   representative at Estée Lauder Malaysia Sdn. Bhd, Suite 18.01, Level 18,   Centrepoint South, The Boulevard, Mid Valley City, Lingkaran Syed Putra,   Kuala lumpur 59200, Malaysia.

The Participant authorizes the   Company, the stock plan service provider and any other possible recipients   which may assist the Company (presently or in the future) with implementing,   administering and managing the Plan to receive, possess, use, retain and   transfer the Data, in electronic or other form, for the purposes of   implementing, administering and managing the Participant’s participation in   the Plan, including any transfer of such Data as may be required to a broker,   escrow agent or other third party with whom the Shares received upon vesting   of the awards may be deposited. The Participant understands that Data will be   held only as long as is necessary to implement, administer and manage the   Participant’s participation in the Plan. The Participant understands that if   the Participant resides outside the United States, the Participant may, at   any time, view Data, request additional information about the storage and   processing of Data, require any necessary amendments to Data, limit the   processing of Data or refuse or withdraw the consents herein, in any case   without cost, by contacting in writing the Participant’s local human   resources representative. Further, the Participant understands that the   Participant is providing the consent herein on a purely voluntary basis. If   the Participant does not
    	
perkhidmatan pelan saham yang mungkin   dipilih oleh Syarikat pada masa depan, yang membantu Syarikat dengan   pelaksanaan, pentadbiran dan pengurusan Pelan. Peserta memahami bahawa   penerima-penerima Data mungkin berada di Amerika Syarikat atau mana-mana   tempat lain, dan bahawa negara penerima-penerima (contohnya, Amerika   Syarikat) mungkin mempunyai undang-undang privasi data dan perlindungan yang   berbeza daripada negara Peserta. Peserta memahami bahawa sekiranya Peserta   menetap di luar Amerika Syarikat, Peserta boleh meminta satu senarai yang   mengandungi nama-nama dan alamat-alamat penerima-penerima Data yang   berpotensi dengan menghubungi wakil sumber manusia tempatan Peserta di Estée   Lauder Malaysia Sdn. Bhd, Suite 18.01, Level 18, Centrepoint South, The   Boulevard, Mid Valley City, Lingkaran Syed Putra, Kuala lumpur 59200,   Malaysia. Peserta memberi kuasa kepada Syarikat, pembekal perkhidmatan pelan   saham dan mana-mana penerima-penerima kemungkinan lain yang mungkin akan   membantu Syarikat (pada masa sekarang atau pada masa depan) dengan   melaksanakan, mentadbir dan menguruskan Pelan untuk menerima, memiliki,   menggunakan, mengekalkan dan memindahkan Data, dalam bentuk elektronik atau   lain-lain, bagi tujuan melaksanakan, mentadbir dan menguruskan penyertaan   Peserta di dalam Pelan, termasuk segala pemindahan Data tersebut sebagaimana   yang dikehendaki kepada broker, egen eskrow atau pihak ketiga dengan siapa   Saham diterima semasa peletakhakan Anugerah mungkin didepositkan. Peserta   memahami bahawa Data hanya akan disimpan selagi ia adalah diperlukan untuk   melaksanakan, mentadbir, dan menguruskan penyertaan Peserta dalam Pelan.   Peserta memahami bahawa sekiranya Peserta menetap di luar Amerika Syarikat,   Peserta boleh, pada bila-bila masa, melihat Data, meminta maklumat tambahan   mengenai penyimpanan dan pemprosesan Data, meminta bahawa pindaan-pindaan   dilaksanakan ke atas Data,
    	
 
    

 

18

 

	
consent, or if the Participant   later seeks to revoke the Participant’s consent, the Participant’s employment   status or service and career with the Company will not be adversely affected;   the only adverse consequence of refusing or withdrawing the Participant’s   consent is that the Company may not be able to grant the Participant equity   awards or administer or maintain such awards. Therefore, the Participant   understands that refusing or withdrawing the Participant’s consent may affect   the Participant’s ability to participate in the Plan. For more information on   the consequences of the Participant’s refusal to consent or withdrawal of   consent, the Participant understands that the Participant may contact the   Participant’s local human resources representative.

Please take note that by   electronically accepting this Agreement, the Participant has confirmed that   the Participant explicitly, voluntarily and unambiguously consents to the   collection, use and transfer of the Participant’s personal data in accordance   with the terms in this notification. However, if for any reason the   Participant does not consent to the processing of the Participant’s personal   data, the Participant has the right to reject such consent by contacting the   Participant’s local human resources representative at Estée Lauder Malaysia   Sdn. Bhd, Suite 18.01, Level 18, Centrepoint South, The Boulevard, Mid   Valley City, Lingkaran Syed Putra, Kuala lumpur 59200, Malaysia.
    	
mengehadkan pemprosesan Data atau   menolak atau menarik balik persetujuan dalam ini, dalam mana-mana kes, tanpa   kos, dengan menghubungi secara bertulis tempatan wakil sumber manusia   Peserta. Selanjutnya, Peserta memahami bahawa Peserta memberikan persetujuan   di sini secara sukarela semata-mata. Sekiranya Peserta tidak bersetuju, atau   sekiranya Peserta kemudian membatalkan persetujuan, status Peserta pekerjaan   atau perkhidmatan dan kerjaya dengan Syarikat tidak akan terjejas;   satu-satunya akibat buruk sekiranya Peserta tidak bersetuju atau menarik   balik Peserta persetujuan adalah bahawa Syarikat tidak akan dapat memberikan   Peserta anugerah ekuiti lain atau mentadbir atau mengekalkan   anugerah-anugerah tersebut. Oleh itu, Peserta memahami bahawa keengganan atau   penarikan balik persetujuan boleh menjejaskan keupayaan Peserta untuk   mengambil bahagian dalam Pelan. Untuk maklumat lebih lanjut mengenai   akibat-akibat keengganan Peserta untuk memberikan keizinan atau penarikan   balik keizinan, Peserta memahami bahawa Peserta boleh menghubungi wakil   sumber manusia tempatan.

Sila ambil perhatian bahawa dengan   menerima Perjanjian ini secara elektronik, Peserta mengesahkan bahawa Peserta   secara eksplisit, sukarela, dan tanpa sebarang keraguan bersetuju dengan   pengumpulan, penggunaan, dan pemindahan data peribadi Peserta mengikut terma-terma   dalam notis ini. Walaubagaimanapun, jika atas apa-apa sebab-sebab tertentu   Peserta tidak bersetuju dengan pemprosesan data peribadi, Peserta mempunyai   hak untuk menolak persetujuan Peserta dengan menghubungi wakil sumber manusia   tempatan di masukkan Estée Lauder Malaysia Sdn. Bhd, Suite 18.01, Level   18, Centrepoint South, The Boulevard, Mid Valley City, Lingkaran Syed Putra,   Kuala lumpur 59200, Malaysia.
    	
 
    

 

19

 

MEXICO

 

Commercial Relationship. The Participant expressly recognizes and acknowledges that the Participant’s participation in the Plan and the Company’s grant of Restricted Stock Units do not constitute an employment relationship between the Participant and the Company. The Participant has been granted the Restricted Stock Units as a consequence of the commercial relationship between the Company and his or her Employer ECLA S.A. de C.V. or Lauder Cosmeticos S.A. de C.V. (“Estée Lauder Mexico”), and Estée Lauder Mexico is the Participant’s sole Employer. Based on the foregoing, (a) the Participant expressly recognizes that the Plan and the benefits the Participant may derive from the Participant’s participation in the Plan do not establish any rights between the Participant and Estée Lauder Mexico, (b) the Plan and the benefits the Participant may derive from the Participant’s participation in the Plan are not part of the employment conditions and/or benefits provided by Estée Lauder Mexico, and (c) any modifications or amendments of the Plan by the Company, or a termination of the Plan by the Company, shall not constitute a change or impairment of the terms and conditions of the Participant’s employment with Estée Lauder Mexico.

 

Extraordinary Item of Compensation. The Participant expressly recognizes and acknowledges that the Participant’s participation in the Plan is a result of the discretionary and unilateral decision of the Company, as well as the Participant’s free and voluntary decision to participate in the Plan in accordance with the terms and conditions of the Plan, the Agreement and this Addendum. As such, the Participant acknowledges and agrees that the Company, in its sole discretion, may amend and/or discontinue the Participant’s participation in the Plan at any time and without any liability. The value of the Restricted Stock Units is an extraordinary item of compensation outside the scope of the Participant’s employment contract, if any. The Restricted Stock Units are not part of the Participant’s regular or expected compensation for purposes of calculating any severance, resignation, redundancy, end of service payments, bonuses, long-service awards, pension or retirement benefits, or any similar payments, which are the exclusive obligations of the Company’s subsidiary in Mexico that employs the Participant.

 

NETHERLANDS

 

Waiver of Termination Rights. The Participant waives any and all rights to compensation or damages as a result of a termination of employment or service, insofar as those rights result or may result from: (a) the loss or diminution in value of such rights or entitlements under the Plan; or (b) the Participant ceasing to have rights, or ceasing to be entitled to any Restricted Stock Unit awards under the Plan as a result of such termination.

 

NEW ZEALAND

 

Securities Law Notice.

 

Warning

 

This is an offer of Restricted Stock Units which, upon vesting and settlement in accordance with the terms of the Plan and the Agreement, will be converted into Shares. Shares give the Participant a stake in the ownership of the Company. The Participant may receive a return on the Shares acquired under the Plan if dividends are paid.

 

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If the Company runs into financial difficulties and is wound up, the Participant will be paid only after all creditors and holders of preference shares have been paid. The Participant may lose some or all of his or her investment, if any.

 

New Zealand law normally requires people who offer financial products to give information to investors before they invest. This information is designed to help investors make an informed decision. The usual rules do not apply to this offer because it is made under an employee share purchase scheme. As a result, the Participant may not be given all the information usually required. The Participant also will have fewer other legal protections for this investment. On this basis, the Participant is advised to ask questions, read all documents carefully, and seek independent financial advice before committing.

 

The Shares are quoted on the New York Stock Exchange (“NYSE”). This means that if the Participant acquires Shares under the Plan, the Participant may be able to sell the Shares on the NYSE if there are interested buyers. The price will depend on the demand for the Shares.

 

For information on risk factors impacting the Company’s business that may affect the value of the Shares, the Participant should refer to the risk factors discussion on the Company’s Annual Report on Form 10-K and Quarterly Reports on Form 10-Q, which are filed with the U.S. Securities and Exchange Commission and are available online at www.sec.gov, as well as on the Company’s “Investor Relations” website at www.elcompanies.com/investors.

 

PANAMA

 

Securities Law Notice. The grant of the Restricted Stock Units and the issuance of Shares at vesting are not subject to registration under Panamanian law as they are not intended for the public, but solely for the Participant’s benefit.

 

PERU

 

Labor Law Acknowledgement. In accepting the Restricted Stock Units, the Participant acknowledges that the Restricted Stock Units are granted ex gratia for the purpose of rewarding the Participant as set forth in the Plan.

 

Securities Law Notice. The grant of the Restricted Stock Units is considered a private offering in Peru; therefore, neither the grant of Restricted Stock Units, nor the issuance of Shares at vesting of the Restricted Stock Units, is subject to securities registration in Peru. For more information concerning the offer, the Participant should refer to the Plan, this Agreement and any other grant documents made available to the Participant by the Company. For more information regarding the Company, the Participant should refer to the Company’s most recent annual report on Form 10-K and quarterly report on Form 10-Q available at www.sec.gov, as well as on the Company’s “Investor Relations” website at www.elcompanies.com/investors.

 

PORTUGAL

 

Language Consent. The Participant hereby expressly declares that he or she has full knowledge of the English language and has read, understood and freely accepted and agreed with the terms and conditions established in the Plan and this Agreement.

 

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Conhecimento da Língua. Pela presente, o Participante declara expressamente que tem pleno conhecimento da língua inglesa e que leu, compreendeu e livremente aceitou e concordou com os termos e coṅdições estabelecidas no Plano e no Acordo (Agreement em inglés).

 

ROMANIA

 

Termination. The following provision shall supplement Section 4 (Termination of Employment of the Agreement:

 

Termination of employment shall include the situation where the Participant’s employment contract is terminated by operation of law on the date the Participant reaches the standard retirement age and has completed the minimum contribution record for receipt of state retirement pension or the relevant authorities award the Participant an early-retirement pension of any type.

 

English Language. The Participant hereby expressly agrees that this Agreement, the Plan as well as all documents, notices and proceedings entered into, relating directly or indirectly hereto, be drawn up or communicated only in the English language. Angajatul consimte în mod expres prin prezentul ca acest Contract, Planul precum şi orice alte documente, notificări, înştiinţări legate direct sau indirect de acest Contract să fie redactate sau efectuate doar în limba engleză.

 

RUSSIA

 

Securities Law Notification. The Agreement, the Plan and all other materials that the Participant may receive regarding participation in the Plan do not constitute advertising or an offering of securities in Russia. Absent any requirement under local law, the issuance of securities pursuant to the Plan has not and will not be registered in Russia; hence, the securities described in any Plan related documents may not be used for offering or public circulation in Russia.

 

Repatriation Requirements. The Participant expressly agrees to promptly repatriate proceeds resulting from the sale of Shares acquired under the Plan to a foreign currency account at an authorized bank in Russia if legally required at the time the Shares are sold and to comply with all applicable local foreign exchange rules and regulations. Neither the Company nor any of its subsidiaries shall be liable for any fines or penalties resulting from the Participant’s failure to comply with applicable law. Russian residents are advised to contact their personal advisor regarding their obligation resulting from their participation in the Plan as significant penalties may apply in the case of non-compliance with exchange control requirements and because such exchange control requirements may change.

 

Data Privacy. This provision shall supplement Section 10 (Data Privacy) of the Agreement:

 

The Participant hereby acknowledges that the Participant has read and understood the terms regarding collection, processing and transfer of Data contained in Section 10 (Data Privacy) of the Agreement and, by participating in the Plan, the Participant agrees to provide an executed data privacy consent to the Employer or the Company (or any other agreements or consent that may be required by the Employer or the Company) that the Company and/or the Employer may deem necessary to obtain under the data privacy laws in Russia, either now or in the future. The Participant understand that the Participant may not be able to participate in the Plan if the Participant fails to execute any such consent or agreement.

 

22

 

SINGAPORE

 

Qualifying Person Exemption. The grant of the Restricted Stock Units under the Plan is being made pursuant to the “Qualifying Person” exemption under section 273(1)(f) of the Securities and Futures Act (Chapter 289, 2006 Ed.) (the “SFA”). The Plan has not been and will not be lodged or registered as a prospectus with the Monetary Authority of Singapore and is not regulated by any financial supervisory authority pursuant to any legislation in Singapore. Accordingly, statutory liability under the SFA in relation to the content of prospectuses would not apply. The Participant should note that, as a result, the Restricted Stock Units are subject to section 257 of the SFA and the Participant will not be able to make: (a) any subsequent sale of the Shares underlying the Restricted Stock Units in Singapore; or (b) any offer of such subsequent sale of the Shares subject to the Restricted Stock Units in Singapore, unless such sale or offer is made pursuant to the exemptions under Part XIII Division 1 Subdivision (4) (other than section 280) of the SFA.

 

SOUTH AFRICA

 

Securities Law Notice. Neither the Restricted Stock Units nor the underlying Shares shall be publicly offered or listed on any stock exchange in South Africa. The offer is intended to be private pursuant to Section 96 of the Companies Act and is not subject to the supervision of any South African governmental authority.

 

Withholding Taxes. The following provision shall supplement Section 6 (Withholding Taxes) of the Agreement:

 

By accepting the Restricted Stock Units, the Participant agrees to notify his or her Employer of the amount of any gain realized upon vesting of the Restricted Stock Units. If the Participant fails to advise the Employer of the gain realized upon vesting of the Restricted Stock Units, the Participant may be liable for a fine. The Participant will be responsible for paying any difference between the actual tax liability and the amount withheld.

 

Exchange Control Obligations. The Participant is solely responsible for complying with applicable exchange control regulations and rulings (the “Exchange Control Regulations”) in South Africa. As the Exchange Control Regulations change frequently and without notice, the Participant should consult the Participant’s legal advisor prior to the acquisition or sale of Shares under the Plan to ensure compliance with current Exchange Control Regulations. Neither the Company nor any of its subsidiaries shall be liable for any fines or penalties resulting from the Participant’s failure to comply with applicable laws, rules or regulations.

 

SPAIN

 

Securities Law Notice. No “offer of securities to the public,” within the meaning of Spanish law, has taken place or will take place in the Spanish territory in connection with the Restricted Stock Unit. The Plan, the Agreement (including this Addendum) and any other documents evidencing the grant of the Restricted stock Units have not, nor will they be, registered with the Comisión Nacional del Mercado de Valores (the Spanish securities regulator) and none of those documents constitute a public offering prospectus.

 

23

 

Acknowledgement of Discretionary Nature of the Plan; No Vested Rights. By accepting the Restricted Stock Units, the Participant consents to participation in the Plan and acknowledges receipt of a copy of the Plan.

 

The Participant understands that the Company has unilaterally, gratuitously and in its sole discretion granted Restricted Stock Units under the Plan to individuals who may be Participants of the Company or its subsidiaries throughout the world. The decision is a limited decision that is entered into upon the express assumption and condition that any grant will not economically or otherwise bind the Company or any of its subsidiaries on an ongoing basis. Consequently, the Participant understands that the Restricted Stock Units are granted on the assumption and condition that the Restricted Stock Units and the Shares acquired upon settlement of the Restricted Stock Units shall not become a part of any employment contract (either with the Company or any of its subsidiaries) and shall not be considered a mandatory benefit, salary for any purposes (including severance compensation) or any other right whatsoever. In addition, the Participant understands that this grant would not be made to the Participant but for the assumptions and conditions referenced above; thus, the Participant acknowledges and freely accepts that should any or all of the assumptions be mistaken or should any of the conditions not be met for any reason the Restricted Stock Units shall be null and void.

 

The Participant understands and agrees that, as a condition of the Restricted Stock Units, unless otherwise provided in Section 4 (Termination of Employment) of the Agreement, any unvested Restricted Stock Units as of the date the Participant ceases active employment will be forfeited without entitlement to the underlying Shares or to any amount of indemnification in the event of termination of employment or service. The Participant acknowledges that the Participant has read and specifically accepts the conditions referred to in the Agreement regarding the impact of a termination on the Restricted Stock Units.

 

Termination for Cause. Notwithstanding anything to the contrary in the Plan or the Agreement, “Cause” shall be as defined as set forth in the Agreement, regardless of whether the termination is considered a fair termination (i.e., “despido procedente”) under Spanish legislation.

 

SWITZERLAND

 

Securities Law Notification. The grant of the Restricted Stock Units and the issuance of any Shares is not intended to be a public offering in Switzerland. Neither this Addendum nor any other materials relating to the Restricted Stock Units constitute a prospectus as such term is understood pursuant to article 652a of the Swiss Code of Obligations. Neither this document nor any other offering or marketing materials relating to the Restricted Stock Units have been or will be filed with, or approved or supervised by, any Swiss regulatory authority (in particular, the Swiss Financial Market Supervisory Authority (FINMA)).

 

TURKEY

 

Securities Law Notification. The sale of Shares acquired under the Plan is not permitted within Turkey. The Shares are currently traded on the New York Stock Exchange (“NYSE”), which is located outside of Turkey, under the symbol “EL” and the Shares may be sold through the NYSE.

 

24

 

UNITED ARAB EMIRATES

 

Securities Law Notification. The Agreement, the Plan and other incidental communication materials concerning the Restricted Stock Units are intended for distribution only to Participants of the Company or its subsidiaries. The Dubai Technology and Media Free Zone Authority, Emirates Securities and Commodities Authority and/or the Central Bank has no responsibility for reviewing or verifying any documents in connection with the Restricted Stock Units. Neither the Ministry of Economy nor the Dubai Department of Economic Development have approved these communications nor taken steps to verify the information set out in them, and have no responsibility for them. Further, the Shares underlying the Restricted Stock Units may be illiquid and/or subject to restrictions on their resale. Participant should conduct his or her own due diligence on the Restricted Stock Units and the Shares. If Participant is in any doubt about any of the contents of the grant or other incidental documents, he or she should obtain independent professional advice.

 

UNITED KINGDOM

 

Withholding Taxes. The following provision shall supplement Section 6 (Withholding Taxes) of the Agreement:

 

If payment or withholding of the income tax due in connection with the awarded Restricted Stock Units is not made within ninety (90) days after the end of the U.K. tax year in which the event giving rise to the income tax liability occurred or such other period specified in Section 222(1)(c) of the U.K. Income Tax (Earnings and Pensions) Act 2003 (the “Due Date”), the amount of any uncollected income tax shall constitute a loan owed by the Participant to his or her Employer, effective as of the Due Date. The Participant agrees that the loan will bear interest at the then-current official rate of Her Majesty’s Revenue & Customs (“HMRC”), it shall be immediately due and repayable, and the Company or the Employer may recover it at any time thereafter by any of the means referred to in Section 6 (Withholding Taxes) of the Agreement. Notwithstanding the foregoing, if the Participant is a director or executive officer of the Company (within the meaning of Section 13(k) of the U.S. Securities and Exchange Act of 1934, as amended), he or she shall not be eligible for a loan from the Company to cover the income tax liability. In the event that the Participant is a director or executive officer and the income tax is not collected from or paid by him or her by the Due Date, the amount of any uncollected income tax may constitute a benefit to the Participant on which additional income tax and national insurance contributions (“NICs”) will be payable. The Participant will be responsible for paying and reporting any income tax due on this additional benefit directly to HMRC under the self-assessment regime, and for reimbursing the Company or the Employer (as applicable) the value of any Participant NICs due on this additional benefit.

 

Exclusion of Claim. The Participant acknowledges and agrees that the Participant will have no entitlement to compensation or damages insofar as such entitlement arises or may arise from the Participant’s ceasing to have rights under or to be entitled to the Restricted Stock Units, whether or not as a result of termination of employment or service (whether the termination is in breach of contract or otherwise), or from the loss or diminution in value of the Restricted Stock Units. Upon the grant of the Restricted Stock Units, the Participant shall be deemed to have waived irrevocably any such entitlement.

 

25

 

VENEZUELA

 

Securities Law Notification. The Restricted Stock Units granted under the Plan and the Shares issued under the Plan are offered as a personal, private, exclusive transaction and are not subject to Venezuelan securities regulations. This offering does not qualify as a public offering under the laws of the Bolivarian Republic of Venezuela and, therefore, it is not required to request the previous authorization of the National Superintendent of Securities.

 

Investment Representation. As a condition of the Restricted Stock Units, the Participant acknowledges and agrees that any Shares the Participant may acquire upon the vesting of the Restricted Stock Units are acquired as and intended to be an investment rather than the resale of the Shares and conversion of Shares into foreign currency.

 

26

 

NOTICE OF GRANT

UNDER

THE ESTÉE LAUDER COMPANIES INC.

AMENDED AND RESTATED FISCAL 2002 SHARE INCENTIVE PLAN
 (The “Plan”)

 

This is to confirm that you were awarded a grant of Restricted Stock Units at the most recent meeting of the Stock Plan Subcommittee of the Compensation Committee of the Board of Directors representing the right upon vesting of such units to receive shares of Class A Common Stock of The Estée Lauder Companies Inc. (the “Shares”), subject to the terms of the Plan and the Restricted Stock Unit Agreement. This award was made in recognition of the significant contributions you have made as a key employee of the Company, and to motivate you to achieve future successes by aligning your interests more closely with those of our stockholders. This Restricted Stock Unit award is granted under and governed by the terms and conditions of the Plan and the Restricted Stock Unit Agreement (the “Agreement”) made part hereof. The Agreement and the Prospectus can be viewed via your online account. Please read these documents and keep them for future reference. The specific terms of your award are as follows:

 

	
Participant:
    	
Name
    
	
 
    	
 
    
	
Employee Number:
    	
#
    
	
 
    	
 
    
	
Number of Restricted Stock Units:
    	
#
    
	
 
    	
 
    
	
Grant Date:
    	
XXX
    
	
 
    	
 
    
	
Vesting Commencement Date:
    	
XXX
    

 

Grant Plan: The Estée Lauder Companies Inc. Amended and Restated Fiscal 2002 Share Incentive Plan

 

Vesting Schedule: Subject to Participant’s continuous employment, this Restricted Stock Unit grant shall vest as to the number of Shares set forth below:

 

	
Shares
    	
Vesting Date
    
	
 
    	
 
    
	
#
    	
XXX
    
	
#
    	
XXX
    
	
#
    	
XXX
    

 

Vesting Period: The Vesting Commencement Date through and including the applicable date set forth in the Vesting Schedule

 

Questions regarding the award can be directed to XXX.

 

If you wish to accept this grant, please sign this Notice of Grant and return immediately to:

 

Compensation Department

28 West 23rd Street, 8th Floor

New York, New York 10010

 

The undersigned hereby accepts, and agrees to, all terms and provisions of the Agreement, including those contained in this Notice of Grant.

 

	
By
    	
 
    	
 
    
	
Date
    	
 
    	
 
    	
 
    
					

 

27Exhibit 10.1

 

PURCHASE AND SALE AGREEMENT

 

by
and among

 

Everest/Sapphire
Acquisition, LLC,

 

SIERRA BULLETS,
L.L.C.,

 

BHH MANAGEMENT,
INC.,

 

LUMBER MANAGEMENT, INC.

 

AND

 

BHH MANAGEMENT, INC., 

 

AS THE SELLERS’ REPRESENTATIVE

 

Dated
as of AUGUST 21, 2017

 

     

     

    

 

Table
of Contents

 

	 	Page
	 	 
	Article 1 PURCHASE AND SALE OF TRANSFERRED INTERESTS; CLOSING	1
	 	 
	 	1.1	Closing	1
	 	 	 	 
	 	1.2	Purchase and Sale of the Transferred Interests	1
	 	 	 	 
	 	1.3	Closing Deliverables; Payments at Closing	1
	 	 	 	 
	 	1.4	Working Capital Adjustment	3
	 	 	 	 
	Article 2 REPRESENTATIONS AND WARRANTIES RELATING TO SELLERS	6
	 	 
	 	2.1	Organization and Good Standing	6
	 	 	 	 
	 	2.2	Power and Authorization; Enforceability	6
	 	 	 	 
	 	2.3	No Violation or Conflict	6
	 	 	 	 
	 	2.4	Ownership of Transferred Interests	7
	 	 	 	 
	 	2.5	Consents	7
	 	 	 	 
	 	2.6	Litigation	7
	 	 	 	 
	 	2.7	FIRPTA	7
	 	 	 	 
	 	2.8	Brokers and Finders	7
	 	 	 	 
	Article 3 REPRESENTATIONS AND WARRANTIES RELATING TO THE COMPANY	8
	 	 
	 	3.1	Organization and Good Standing	8
	 	 	 	 
	 	3.2	Power and Authorization; Enforceability	8
	 	 	 	 
	 	3.3	No Violation or Conflict	8
	 	 	 	 
	 	3.4	Capitalization	9
	 	 	 	 
	 	3.5	Compliance with Laws	9
	 	 	 	 
	 	3.6	Litigation	10
	 	 	 	 
	 	3.7	Financial Statements; Undisclosed Liabilities; Books and Records	10
	 	 	 	 
	 	3.8	Absence of Certain Changes and Events	11
	 	 	 	 
	 	3.9	Real Property	13
	 	 	 	 
	 	3.10	Material Contracts	15
	 	 	 	 
	 	3.11	Insurance	19
	 	 	 	 
	 	3.12	Permits	19
	 	 	 	 
	 	3.13	Tangible Personal Property	19
	 	 	 	 
	 	3.14	Intellectual Property	19
	 	 	 	 
	 	3.15	Labor Matters	22
	 	 	 	 
	 	3.16	Employee Benefits	23
	 	 	 	 
	 	3.17	Environmental Matters	24

 

    	-i-

     

    

 

Table
of Contents

(continued)

 

	 	 	 	Page
	 	 	 	 
	 	3.18	Tax Matters	25
	 	 	 	 
	 	3.19	Customers and Suppliers	26
	 	 	 	 
	 	3.20	Inventory; Accounts Receivable	27
	 	 	 	 
	 	3.21	Related Party Transactions	27
	 	 	 	 
	 	3.22	Brokers	28
	 	 	 	 
	 	3.23	Banking Relationships	28
	 	 	 	 
	 	3.24	Products; Product Liability	28
	 	 	 	 
	 	3.25	Propriety of Past Payments	28
	 	 	 	 
	 	3.26	Personal Information Laws	29
	 	 	 	 
	 	3.27	International Trade Laws and Regulations	29
	 	 	 	 
	 	3.28	Internal Accounting Controls	29
	 	 	 	 
	 	3.29	Conflict Minerals	30
	 	 	 	 
	Article 4 REPRESENTATIONS AND WARRANTIES OF BUYER	30
	 	 
	 	4.1	Organization and Good Standing	30
	 	 	 	 
	 	4.2	Power and Authorization; Enforceability	30
	 	 	 	 
	 	4.3	No Violation or Conflict	30
	 	 	 	 
	 	4.4	Compliance with Laws	31
	 	 	 	 
	 	4.5	Litigation	31
	 	 	 	 
	 	4.6	Brokers	31
	 	 	 	 
	 	4.7	Investment	31
	 	 	 	 
	 	4.8	Available Funds	31
	 	 	 	 
	 	4.9	Solvency	32
	 	 	 	 
	 	4.10	Tax and Legal Matters	32
	 	 	 	 
	Article 5 CERTAIN COVENANTS OF THE PARTIES	32
	 	 
	 	5.1	Further Actions	32
	 	 	 	 
	 	5.2	Access to Information	32
	 	 	 	 
	 	5.3	Confidentiality; Books and Records	33
	 	 	 	 
	 	5.4	Restrictive Covenants	34
	 	 	 	 
	 	5.5	Tax Matters	36
	 	 	 	 
	 	5.6	Employee Matters	38
	 	 	 	 
	 	5.7	Directors’ and Officers’ Exculpation; Indemnification	40
	 	 	 	 
	 	5.8	Representation & Warranty Insurance Policy	40

 

    	-ii-

     

    

 

Table
of Contents

(continued)

 

	 	 	 	Page
	 	 	 	 
	Article 6 INDEMNIFICATION	40
	 	 
	 	6.1	Indemnification by Sellers	40
	 	 	 	 
	 	6.2	Indemnification by Buyer	41
	 	 	 	 
	 	6.3	Claims	42
	 	 	 	 
	 	6.4	Survival	44
	 	 	 	 
	 	6.5	Certain Limitations on Indemnification	44
	 	 	 	 
	 	6.6	Certain Other Restrictions on Indemnification	44
	 	 	 	 
	 	6.7	Calculation and Mitigation of Losses	46
	 	 	 	 
	 	6.8	Acknowledgment	46
	 	 	 	 
	 	6.9	Exclusive Remedy	46
	 	 	 	 
	 	6.10	Special Rule for Fraud	46
	 	 	 	 
	Article 7 SELLERS’ REPRESENTATIVE	47
	 	 
	 	7.1	Sellers’ Representative Appointment and Powers	47
	 	 	 	 
	 	7.2	Fees and Expenses	47
	 	 	 	 
	 	7.3	Liability of Sellers’ Representative	48
	 	 	 	 
	 	7.4	Resignation or Removal of the Sellers’ Representative	48
	 	 	 	 
	 	7.5	Reliance	48
	 	 	 	 
	Article 8 MISCELLANEOUS	48
	 	 
	 	8.1	Fees and Expenses	48
	 	 	 	 
	 	8.2	Notices	49
	 	 	 	 
	 	8.3	Releases	50
	 	 	 	 
	 	8.4	Assignment and Benefit	51
	 	 	 	 
	 	8.5	Amendment, Modification and Waiver	51
	 	 	 	 
	 	8.6	Due Diligence Review; No Additional Representations and Warranties	52
	 	 	 	 
	 	8.7	Disclaimer Regarding Projections	52
	 	 	 	 
	 	8.8	Interpretation	52
	 	 	 	 
	 	8.9	Governing Law	53
	 	 	 	 
	 	8.10	Jurisdiction	54
	 	 	 	 
	 	8.11	Waiver of Jury Trial	54
	 	 	 	 
	 	8.12	Conflicts and Privilege	55
	 	 	 	 
	 	8.13	Section Headings	55
	 	 	 	 
	 	8.14	Severability	55

 

    	-iii-

     

    

 

Table
of Contents

(continued)

 

	 	 	 	Page
	 	 	 	 
	 	8.15	Counterparts; Third-Party Beneficiaries	56
	 	 	 	 
	 	8.16	Entire Agreement	56
	 	 	 	 
	 	8.17	Attorneys’ Fees	56
	 	 	 	 
	 	8.18	Specific Performance	56
	 	 	 	 
	 	8.19	Incorporation of Schedules and Exhibits	56
	 	 	 	 
	 	8.20	Termination of Operating Agreement	56

 

    	-iv-

     

    

 

Exhibits

 

A - Definitions

B - Disclosure Schedule

C - Estimated Closing Statement

D - Pro Rata Portion

E - Representation & Warranty Insurance
Policy

 

    	-v-

     

    

 

PURCHASE AND SALE AGREEMENT

 

This PURCHASE AND
SALE AGREEMENT (this “Agreement”) dated as of August 21, 2017 (the “Closing Date”) by
and among Everest/Sapphire Acquisition, LLC, a Delaware limited liability company (“Buyer”), Sierra Bullets
L.L.C., a Delaware limited liability company (the “Company”), BHH Management, Inc., a California corporation
(“BHH”), Lumber Management, Inc., a Delaware corporation (“LMI” and, together with BHH, each
a “Seller” and, collectively, the “Sellers”), and BHH, in its capacity as the representative
of Sellers (the “Sellers’ Representative”). Exhibit A contains definitions, or references
to the definitions, of the capitalized terms used in this Agreement. Sellers and Buyer are each referred to herein individually
as a “Party” and collectively as the “Parties.”

 

BACKGROUND

 

		A.	BHH owns 86.49% of the limited liability company interests of the Company (the “BHH Interest”)
and LMI owns 13.51% of the limited liability company interests of the Company (the “LMI Interest” and, together
with the BHH Interest, the “Transferred Interests”).

 

		B.	On the terms and subject to the conditions set forth in this Agreement and in exchange for the
consideration set forth in Section 1.3, (i) BHH desires to sell assign, convey, and deliver to Buyer, and Buyer desires
to purchase from BHH, all right, title and interest in and to all of the BHH Interest, and (ii) LMI desires to sell assign, convey,
and deliver to Buyer, and Buyer desires to purchase from LMI, all right, title and interest in and to all of the LMI Interest (collectively,
the “Transactions”).

 

		C.	Following the Closing, Buyer will own all of the Transferred Interests.

 

AGREEMENT

 

In consideration of
the mutual covenants, conditions and agreements set forth in this Agreement, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, it is agreed as follows:

 

Article
1

PURCHASE
AND SALE OF TRANSFERRED INTERESTS; CLOSING

 

		1.1	Closing. The closing of the Transactions (the “Closing”) will
take place on the Closing Date simultaneously with the execution and delivery of this Agreement.

 

		1.2	Purchase and Sale of the Transferred Interests. On the terms and subject to the conditions
set forth in this Agreement, at the Closing, (i) BHH will sell, assign, convey, transfer, and deliver to Buyer, and Buyer will
purchase from BHH, all of the BHH Interests, free and clear of all Liens, for a portion of the cash consideration described in
Section 1.3; and (ii) LMI will sell, assign, convey, transfer, and deliver to Buyer, and Buyer will purchase from
LMI, all of the LMI Interests, free and clear of all Liens, for a portion of the cash consideration described in Section
1.3.

 

		1.3	Closing Deliverables; Payments at Closing.

 

		1.3.1	Seller Deliveries. At the Closing, the Sellers’ Representative is delivering
or causing to be delivered to Buyer:

 

     

     

    

 

		(a)	this Agreement, duly executed by the Company, each Seller
and the Sellers’ Representative;

 

		(b)	(i) a certificate, dated the Closing Date, signed by the
Secretary or any Assistant Secretary of the managing member of the Company, attesting to: (a) the completion of all necessary
limited liability company action by the Company and all necessary corporate action by BHH to execute and deliver this Agreement,
the other Seller Transaction Documents and the other Company Transaction Documents and to consummate the Transactions, and including
copies of the Company’s Governing Documents and all resolutions required in connection with this Agreement or any other
Company Transaction Document and (b) the good standing (or similar) certificates of the Company with respect to such entity’s
jurisdiction of organization, and (ii) a certificate, dated the Closing Date, signed by an authorized officer of LMI, attesting
to the completion of all necessary corporate action by LMI to execute and deliver this Agreement and the other Seller Transaction
Documents and to consummate the Transactions;

 

		(c)	payoff letter(s) in form and substance reasonably satisfactory
to Buyer (the “Payoff Letters”), together with UCC-3 termination statements with respect to the financing statements
filed against the assets of the Company by the holders of such Liens, in each case, in form and substance reasonably satisfactory
to Buyer relating to the payment of all Estimated Closing Indebtedness set forth in the Estimated Closing Statement (the “Payoff
Amounts”), which Payoff Letters will contain customary lien releases;

 

		(d)	the consents set forth on Section 1.3.1(d) of the Disclosure
Schedule, in each case, in form and substance reasonably satisfactory to Buyer;

 

		(e)	a Notice of Non-U.S. Real Property Holding Corporation
Status which meets the requirements of Treasury Regulation Section 1.897-2(h) and is sufficient to exempt the transactions contemplated
by this Agreement from withholding pursuant to the provisions of the Foreign Investment in Real Property Tax Act;

 

		(f)	evidence of binding director and officer insurance coverage;

 

		(g)	offer letters, duly executed by the Employees identified
on Section 1.3.1(g) of the Disclosure Schedule, pursuant to which such Employees agree to be bound by Buyer’s terms
and conditions of employment;

 

		(h)	resignations, in form and substance reasonably satisfactory
to Buyer, of each manager, director and executive officer of the Company, which will be effective upon the Closing, except for
such Persons as will have been designated in writing prior to the Closing by Buyer to the Sellers’ Representative; and

 

		(i)	a DVD containing a copy of the information and documents
set forth in the Data Room.

 

		1.3.2	Buyer Deliveries. At the Closing, Buyer is delivering, or causing to be delivered,
and paying, or causing to be paid, by wire transfer in immediately available funds (without any withholding or deduction of any
kind except as otherwise provided for in this Agreement or otherwise required by Law), the following:

 

    	 	- 2 -	 

     

    

 

		(a)	this Agreement, duly executed by Buyer;

 

		(b)	a certificate, dated the Closing Date, signed by the Secretary
or any Assistant Secretary of Buyer, attesting to: (i) the completion of all necessary corporate action by Buyer to execute and
deliver this Agreement and the other Buyer Transaction Documents and to consummate the Transactions, and including copies of the
Governing Documents of Buyer and resolutions required in connection with this Agreement and any other Buyer Transaction Document
and (ii) the good standing (or similar) certificate of Buyer with respect to Buyer’s jurisdiction of organization;

 

		(c)	evidence that Buyer (or one or more of its Affiliates)
has entered into the representation and warranty insurance policy attached hereto as Exhibit E (the “Representation
and Warranty Insurance Policy”) pursuant to Section 5.8;

 

		(d)	the Payoff Amounts to the accounts and in the amounts set
forth in the Payoff Letters, and the Estimated Closing Transaction Expenses to the accounts and in the amounts set forth in the
Estimated Closing Statement, in each case, to the extent not paid by or on behalf of the Company and/or its Affiliates prior to
the Closing;

 

		(e)	to the Sellers’ Representative, for the benefit of
Sellers, to the account specified in writing by the Sellers’ Representative, the Sellers’ Representative Amount, to
be held and disbursed by the Sellers’ Representative in accordance with the terms of this Agreement; and

 

		(f)	to Sellers, according to each Seller’s Pro Rata Portion,
to the accounts specified in writing by the Sellers’ Representative, the Estimated Closing Date Purchase Price.

 

		1.4	Working Capital Adjustment.

 

		1.4.1	Estimated Closing Statement. Attached hereto as Exhibit C (which such
Exhibit C was delivered to Buyer prior to Closing) is a written statement (the “Estimated Closing Statement”)
reflecting Sellers’ good faith calculations, in accordance with the Accounting Principles, of (a)(i) the Net Working Capital
as of 11:59 p.m. on the Business Day immediately prior to the Closing Date (the “Estimated Closing Working Capital”),
(ii) the Cash of the Company as of 11:59 p.m. on the Business Day immediately prior to the Closing Date (the “Estimated
Closing Cash”), (iii) the Indebtedness of the Company as of 11:59 p.m. on the Business Day immediately prior to the Closing
Date (the “Estimated Closing Indebtedness”), and (iv) the Transaction Expenses of the Company (the “Estimated
Closing Transaction Expenses”), and (b) Sellers’ calculation of the Estimated Closing Date Purchase Price.

 

    	 	- 3 -	 

     

    

 

		1.4.2	Closing Statement. As promptly as practicable, but no later than sixty (60) days
after the Closing Date, Buyer will cause to be prepared and delivered to the Sellers’ Representative a written statement
(the “Closing Statement”) setting forth Buyer’s good faith calculations, in accordance with the Accounting
Principles, of (a)(i) the Net Working Capital as of 11:59 p.m. on the Business Day immediately prior to the Closing Date (the “Closing
Working Capital”), (ii) the Cash of the Company as of 11:59 p.m. on the Business Day immediately prior to the Closing
Date (the “Closing Cash”), (iii) the Indebtedness of the Company as of 11:59 p.m. on the Business Day immediately
prior to the Closing Date (the “Closing Indebtedness”), and (iv) the Transaction Expenses of the Company as
of the Closing Date (the “Closing Transaction Expenses”), and (b) Buyer’s calculation of the Closing Date
Purchase Price. Following delivery of the Closing Statement, and upon reasonable request of the Sellers’ Representative,
Buyer and the Company will, upon reasonable notice, provide the Sellers’ Representative and its advisors with reasonable
access to the Company’s employees, books and records during normal business hours to the extent reasonably related to the
Sellers’ Representative’s evaluation of the Closing Statement. If Buyer fails to deliver the Closing Statement within
such sixty (60)-day period, the Sellers’ Representative will deliver to Buyer its own calculation of the Closing Working
Capital, Closing Cash, the Closing Indebtedness, the Closing Transaction Expenses and the Closing Date Purchase Price, and the
Sellers’ Representative’s calculation will be final and binding upon the Parties.

 

		1.4.3	Dispute Notice. If the Sellers’ Representative disagrees with the calculations
set forth in the Closing Statement delivered by Buyer pursuant to Section 1.4.2, the Sellers’ Representative
may, within sixty (60) days after receipt of the Closing Statement, deliver a written notice to Buyer (a “Dispute Notice”)
specifying in reasonable detail each item or amount that the Sellers’ Representative disputes (the “Disputed Items”),
the amount in dispute for each Disputed Item and the reasons supporting the Sellers’ Representative’s positions. The
Sellers’ Representative will be deemed to have agreed with all other items and amounts contained in the Closing Statement
that are not Disputed Items. If the Sellers’ Representative fails to deliver a Dispute Notice within such sixty (60)-day
period, Buyer’s calculation of the Closing Working Capital, the Closing Cash, the Closing Indebtedness, the Closing Transaction
Expenses and the Closing Date Purchase Price will be deemed accepted by Sellers and the Sellers’ Representative and will
be final, conclusive and binding on the Parties.

 

		1.4.4	Resolution Period. If a Dispute Notice is duly delivered pursuant to Section
1.4.3, Buyer and the Sellers’ Representative will, during the thirty (30) days following such delivery (the “Resolution
Period”), use commercially reasonable efforts to reach agreement on the Disputed Items or amounts in order to determine
the amount of the Closing Working Capital, the Closing Cash, the Closing Indebtedness, the Closing Transaction Expenses, and/or
the Closing Date Purchase Price, as applicable. If Buyer and the Sellers’ Representative are able to reach agreement with
respect to any Disputed Items, Buyer will promptly revise the Closing Statement to reflect such agreement.

 

    	 	- 4 -	 

     

    

 

		1.4.5	Independent Accounting Firm. If, upon the conclusion of the Resolution Period, or
any mutually-agreed upon extension thereof, Buyer and the Sellers’ Representative are unable to reach agreement on all of
the Disputed Items, they will jointly engage and submit the unresolved Disputed Items (the “Unresolved Items”)
to the Independent Accounting Firm for resolution in accordance with the terms of this Section 1.4.5. The Independent
Accounting Firm (i) will act as an arbitrator to determine, based solely on presentations by Buyer and the Sellers’ Representative
and not by independent review, only the Unresolved Items, (ii) will make a determination with respect to the Unresolved Items only
and in a manner consistent with this Section 1.4.5, (iii) will use the definitions set forth herein with no consideration
given to any modification of such definitions, (iv) will be limited to those adjustments, if any, required to be made for the Closing
Statement to comply with the provisions of this Agreement and (v) will make a determination of the Unresolved Items within the
range of Buyer’s and the Sellers’ Representative’s disagreement. Each Party will use commercially reasonable
efforts to furnish to the Independent Accounting Firm such work papers and other documents and information pertaining to the Unresolved
Items as the Independent Accounting Firm may reasonably request and will be afforded an opportunity to discuss the Unresolved Items
with the Independent Accounting Firm at such hearing as the Independent Accounting Firm will request or permit; provided,
that (y) each Party will provide the other Party with a copy of all materials provided to, and communications with, the Independent
Accounting Firm and (z) no Party (or any of its Affiliates or Representatives) will engage in any ex parte communication
with the Independent Accounting Firm at any time with respect to the Unresolved Items. The Independent Accounting Firm will deliver
to Buyer and the Sellers’ Representative as promptly as practicable, and will be instructed to deliver no later than thirty
(30) days after its engagement, a written report setting forth such calculation. Such determination of the Independent Accounting
Firm will be final, binding and conclusive upon Buyer and Sellers (absent fraud or manifest error) and Buyer will promptly revise
the Closing Statement to reflect such determination upon receipt of such report. The fees and expenses of the Independent Accounting
Firm will be borne pro rata as between Buyer, on the one hand, and Sellers, on the other hand, based on the proportionate deviation
of the respective adjustment amounts for the Unresolved Items proposed by Buyer and the Sellers’ Representative, as set forth
in the Closing Statement in the case of Buyer and the Dispute Notice in the case of the Sellers’ Representative, from the
determination of the final adjustment amounts made by the Independent Accounting Firm. The date on which the Closing Working Capital,
the Closing Cash, the Closing Indebtedness, the Closing Transaction Expenses, and Closing Date Purchase Price are finally determined
in accordance with this Section 1.4 is referred to as the “Determination Date.”

 

		1.4.6	Adjustment to Purchase Price. The “Adjustment Amount” means the
difference between the Closing Date Purchase Price (as finally agreed upon or determined pursuant to this Section 1.4)
and the Estimated Closing Date Purchase Price. If the Adjustment Amount is a positive amount, then promptly, and in any event within
five (5) Business Days following the Determination Date, Buyer will pay or cause to be paid to Sellers, by wire transfer of immediately
available funds to the account or accounts designated in writing by the Sellers’ Representative, each Seller’s Pro
Rata Portion of the Adjustment Amount. If the Adjustment Amount is a negative amount, then promptly, and in any event within five
(5) Business Days following the Determination Date, Sellers will pay or cause to be paid to Buyer, by wire transfer of immediately
available funds to an account designated in writing by Buyer, an amount equal to the Adjustment Amount, with each Seller being
responsible for its Pro Rata Portion of such Adjustment Amount.

 

    	 	- 5 -	 

     

    

 

		1.4.7	No Adverse Actions. Buyer and the Company agree that, following the Closing and until
the Adjustment Amount becomes final and binding upon the parties to this Agreement, the Company will not take any actions with
respect to the accounting books and records of the Company as of the Closing Date on which the Closing Statement is to be based
that are not consistent with the Accounting Principles.

 

Article
2

REPRESENTATIONS
AND WARRANTIES RELATING TO SELLERS

 

Except as set forth
in the Disclosure Schedule, which exceptions or disclosures set forth therein will be deemed to be part of the representations
and warranties made hereunder, each Seller, severally and not jointly, solely with respect to itself and not with respect to the
other Seller, represents and warrants to Buyer as set forth below as of the Closing Date:

 

		2.1	Organization and Good Standing. Such Seller has been duly formed and is validly existing
and in good standing under the Laws of its jurisdiction of organization and has the requisite power and authority to own or lease
its properties and to conduct its business as it is now being conducted.

 

		2.2	Power and Authorization; Enforceability.

 

		2.2.1	Such Seller has all requisite right, power, authority and capacity to execute and deliver this
Agreement and the other Transaction Documents to which it is, or is specified to be, a party (collectively, the “Seller
Transaction Documents”), to perform its obligations hereunder and thereunder and to carry out the Transactions. All necessary
action has been taken by such Seller to authorize the execution, delivery and performance by it of this Agreement and each other
Seller Transaction Document, and no further action on the part of such Seller is necessary to authorize such execution, delivery
and performance. Such Seller has duly executed and delivered this Agreement and, at or prior to the Closing, will have duly executed
and delivered each other Seller Transaction Document.

 

		2.2.2	Assuming that this Agreement and each of the other Seller Transaction Documents are valid and binding
obligations of each of the other parties hereto and thereto, this Agreement is, and each other Seller Transaction Document, when
duly executed and delivered at or prior to the Closing by such Seller will be, the legal, valid and binding obligation of such
Seller, enforceable against such Seller in accordance with its respective terms, except as enforceability thereof may be limited
by the Remedies Exception.

 

		2.3	No Violation or Conflict. Neither the execution, delivery and performance by such
Seller of this Agreement and the other Seller Transaction Documents nor the consummation of the Transactions (with or without the
passage of time or the giving of notice, or both) will (a) contravene, conflict with or result in a violation or breach of, constitute
a default under, or give a right to terminate or cancel under, (A) the Governing Documents of such Seller or (B) any (1) Judgments
or (2) Laws, in each case, binding upon or applicable to such Seller or any of its respective Affiliates or by which it or any
of its respective properties or assets are bound; (b) contravene, conflict with, result in a violation or breach of, constitute
a default under, or give a right to terminate or cancel under, any of the terms or conditions of any Contract to which such Seller
is a party or by which it or any of its respective properties or assets are bound; (c) result in the creation or imposition of
any Lien upon any of the assets of such Seller (including the Transferred Interests); or (d) cause a loss or adverse modification
of any material Governmental Authorization used or held by such Seller or any of its respective Affiliates.

 

    	 	- 6 -	 

     

    

 

		2.4	Ownership of Transferred Interests. Such Seller is the beneficial and record owner
of the Transferred Interests set forth opposite such Seller’s name on Section 3.4 of the Disclosure Schedule and has
the sole right to vote or direct the voting of such Transferred Interests, at its discretion, on any matter submitted to a vote
of the members of the Company. Such Seller’s Transferred Interests constitute all of Equity Interests of the Company that
are owned legally, beneficially or of record by such Seller. The Company has no membership interests or other Equity Interests
other than the Transferred Interests. All of the Transferred Interests of such Seller in the Company are owned directly by such
Seller free and clear of all Liens and free of any other restriction, except for restrictions imposed by applicable securities
Laws, and such Seller has good and marketable title to the Transferred Interests free and clear of all Liens. Such Seller has not
granted or acknowledged to any Person any rights with respect to any of such Seller’s Transferred Interests or any other
Equity Interests of the Company and such Seller has sole voting power and sole power to issue instructions with respect to the
matters set forth herein, sole power of disposition, sole power of conversion, sole power to demand appraisal rights and sole power
to agree to all of the matters set forth in this Agreement, in each case with respect to such Seller’s Transferred Interests
and other Equity Interests, with no limitations, qualifications or restrictions on such rights. Such Seller does not have any claim
against the Company or any of its officers, managers or any other Person with respect to the issuance of any equity of the Company
or other Equity Interests. Such Seller has not commenced nor does such Seller intend to commence a voluntary case or other proceeding,
and no involuntary case or other proceeding has been commenced against such Seller seeking liquidation or other relief with respect
to its debts under any bankruptcy, insolvency or other similar Law. Upon the assignment of such Seller’s Transferred Interests
by such Seller to the Buyer, and upon such Seller’s receipt of the Closing Date Purchase Price, good and marketable title
to such Seller’s Transferred Interests will pass to the Buyer, free and clear of any Liens.

 

		2.5	Consents. No Consent of any Governmental Authority or any other Person is required
to be obtained, made or effected by such Seller in connection with the execution and delivery of this Agreement and the other Seller
Transaction Documents or the performance of such Seller’s obligations hereby or thereby.

 

		2.6	Litigation. There are no Proceedings pending or threatened in writing, before any
Governmental Authority or arbitrator with respect to such Seller which seeks to delay or prevent the consummation of the transactions
contemplated by this Agreement by such Seller or would, if successful, be reasonably expected to adversely affect the ability of
such Seller to perform its obligations under this Agreement.

 

		2.7	FIRPTA. Such Seller is not a “foreign person” within the meaning of Section
1445 of the Code.

 

		2.8	Brokers and Finders. Except for Houlihan Lokey Capital, Inc., no broker, investment
banker, financial advisor, finder, agent or similar intermediary has acted on such Seller’s behalf in connection with this
Agreement or any of the transactions contemplated hereby, and except for fees payable to Houlihan Lokey Capital, Inc., there are
no brokerage commissions, finders’ fees or similar fees or commissions payable in connection therewith based on any Contract
with such Seller or any action taken by such Seller.

 

    	 	- 7 -	 

     

    

 

Article
3

REPRESENTATIONS
AND WARRANTIES RELATING TO THE COMPANY

 

Except as set forth
on the Disclosure Schedule, which exceptions or disclosures set forth therein will be deemed to be part of the representations
and warranties made hereunder, Sellers hereby represent and warrant to Buyer as set forth below as of the Closing Date:

 

		3.1	Organization and Good Standing. The Company is a limited liability company duly organized,
validly existing and in good standing under the Laws of the State of Delaware, and has full limited liability company power to
carry on its business as presently conducted, and to own and lease the assets and properties which it owns and leases. The Company
is duly qualified or licensed to do business as a foreign company and is in good standing (if applicable) in each jurisdiction
in which its ownership or leasing of assets or properties or the nature of its activities requires such qualification. The Company
has never employed any Person in any jurisdiction outside of the United States.

 

		3.2	Power and Authorization; Enforceability.

 

		3.2.1	The Company has full right, power, and authority to execute and deliver this Agreement and the
other Transaction Documents to which it is, or is specified to be, a party (collectively, the “Company Transaction Documents”),
to perform its obligations hereunder and thereunder, and to consummate the Transactions. All necessary limited liability company
action has been taken by the Company to authorize the due and valid execution, delivery and performance by the Company of this
Agreement and each other Company Transaction Document. The Company has duly executed and delivered this Agreement and, at or prior
to the Closing, will have duly executed and delivered each other Company Transaction Document.

 

		3.2.2	Assuming that this Agreement and each of the other Company Transaction Documents are valid and
binding obligations of each of the other parties hereto and thereto, this Agreement is, and each other Company Transaction Document,
when duly executed and delivered at or prior to the Closing by the Company, will be, the legal, valid and binding obligation of
the Company, enforceable against it in accordance with its respective terms, except as enforceability of such obligations may be
limited by the Remedies Exception.

 

		3.3	No Violation or Conflict.

 

		3.3.1	Neither the execution, delivery and performance by the Company of this Agreement or of the other
Company Transaction Documents nor the consummation of the Transactions (with or without the passage of time or the giving of notice,
or both) will:

 

		(a)	conflict with, or result in a breach of, the Governing
Documents of the Company;

 

		(b)	violate or conflict with any Judgments or Laws, in each case, binding upon or applicable to the
Company or by which the Company or any of its properties or assets are bound or require the consent, approval or action of, filing
with or notice to any Governmental Authority or other Person;

 

    	 	- 8 -	 

     

    

 

		(c)	violate, or be in conflict with, or constitute a default (or an event which, with notice or lapse
of time or both, would constitute a default) under, or result in, or provide the basis for, the termination of, or accelerate the
performance required by, or excuse performance by any Person of any of its obligations under, or cause the acceleration of the
maturity of any Indebtedness or obligation pursuant to, or result in the creation or imposition of any Lien upon any property or
assets of the Company under, or any Material Contract to which the Company is a party or by which it or any of its properties or
assets are bound;

 

		(d)	result in the creation or imposition of any Lien upon any of the Transferred Interests; or

 

		(e)	cause a loss or adverse modification of any Governmental Authorization used or held by the Company
or any of its Affiliates.

 

		3.3.2	No consent or approval of or notice to any Governmental Authority or any other Person is required
to be obtained, made or effected by Company in connection with the execution and delivery of this Agreement and the other Transaction
Documents or the performance of the Company’s obligations hereby or thereby.

 

		3.4	Capitalization. Section 3.4 of the Disclosure Schedule sets forth a complete
and accurate list of (a) the Transferred Interests, which are the only authorized, issued and outstanding equity securities of
the Company and (b) the record holders thereof. Other than as provided for in the Governing Documents of the Company, no Rights
in respect of any Equity Interests of the Company have been granted by the Company or the Sellers. No Person, other than the Sellers,
has any interest or claim to any of the membership interests of the Company. All of the Transferred Interests have been duly authorized
and are validly issued. The holders of the Transferred Interests have no obligation to make further payments or contributions to
the Company solely by reason of their ownership thereof. All of the Transferred Interests have been offered, issued and transferred
without violation of any preemptive right or other right to purchase and were issued and/or transferred in compliance with all
applicable securities Laws, other Laws, the operating agreement of the Company and the Contracts to which the Company is a party
or otherwise bound. Upon the consummation of the transactions contemplated hereby, Buyer will be the sole owner, beneficially and
of record, of 100% of the issued and outstanding membership interests of the Company, free and clear of any Liens. The Company
does not control, directly or indirectly, or have any direct or indirect Equity Interest in, any Person and there is no other Person
with respect to which (i) the Company may be deemed to be in control because of factors or relationships other than the quantity
of stock or other interests owned in such Person (if any) or (ii) the Company may be liable under any circumstances for the payment
of additional amounts with respect to its interest in such Person, whether in the form of assessments, capital calls installment
payments, general partner liability or otherwise. There are no voting trusts, proxies or other similar commitments, understandings,
restrictions or arrangements relating to the Equity Interests in or of the Company. There is no Voting Debt of the Company.

 

		3.5	Compliance with Laws.
The Company has, during the five (5) years prior to the date of this Agreement, complied in all material respects with, is not
in violation of, and has not received any written notices of violation with respect to, any Law applicable to it or its Business,
properties or assets. The Company has previously provided or made available to the Buyer or its counsel true and correct copies
of all reports of inspections received by it with respect to the Business under applicable Laws which occurred since January 1,
2014, and resulted in or is reasonably likely to result in the imposition of a material penalty or restriction. During the five
(5) years prior to the date of this Agreement, the Company has not received any written notice alleging that the Company is in
violation of any Law and, to the Company’s Knowledge, no investigation, inspection, audit, or other proceeding by any Governmental
Authority involving an allegation of violation of any Law by the Company is otherwise threatened or contemplated. The Company
has not assumed by contract or operation of Law any liability for violations by any other Person of any Law.

 

    	 	- 9 -	 

     

    

 

		3.6	Litigation. There are no Proceedings pending
or, to the Company’s Knowledge, threatened in writing which involve the Company, its businesses or assets. There are no
unsatisfied Judgments against the Company or any of its businesses, properties or assets. There is no Proceeding pending or, to
the Company’s Knowledge, threatened in writing against the Company which questions or challenges the validity of this Agreement
or any action taken or to be taken by the Company pursuant to this Agreement or in connection herewith or would adversely affect
the ability of the Company to consummate the Transactions. There are no current, pending or, to the Company’s Knowledge,
threatened claims for against the Company in favor of the managers, officers, employees and agents of the Company. To the Company’s
Knowledge, there exist no facts or circumstances creating any reasonable basis for the institution of any material Proceedings.
Section 3.6 of the Disclosure Schedule sets forth a complete and correct list and description of all Proceedings since
January 1, 2014 to which the Company is or has been a party.

 

		3.7	Financial Statements; Undisclosed Liabilities; Books and Records.

 

		3.7.1	Financial Statements. The Company has provided Buyer with complete and accurate copies
of the following financial statements (collectively, the “Financial Statements”): (i) the audited consolidated
balance sheets of the Company and its affiliate as of December 31, 2016 (the “Most Recent Fiscal Year End”),
December 31, 2015 and December 31, 2014 (including the notes thereto, if any), and the related audited consolidated statements
of income, shareholders’ equity and cash flows as of the fiscal years then ended; and (ii) the unaudited balance sheet (the
“Latest Balance Sheet”) of the Company as of June 30, 2017 (the “Latest Balance Sheet Date”)
(including the notes thereto, if any) and the related unaudited statements of income, shareholders’ equity and cash flows
as of and for the period from the Most Recent Fiscal Year End through such date (the “Unaudited Financial Statements”).
The Financial Statements (including the notes thereto, if any) are consistent with the books and records of the Company, fairly
present in all material respects the consolidated (as applicable) financial condition, cash flows and results of operations of
the Company and, as applicable, its affiliate as at the dates thereof and for the periods therein referred to, in accordance with
GAAP, subject, in the case of the Unaudited Financial Statements, to the absence of footnote disclosure and changes resulting from
normal year-end adjustments.

 

		3.7.2	Undisclosed Liabilities. The Company does not have any direct or indirect Indebtedness,
liability, claim, loss, damage, deficiency, obligation or monetary responsibility, whether matured or unmatured or fixed or contingent
(“Liabilities”), other than: (i) Liabilities which are adequately disclosed or reserved against on the Latest
Balance Sheet; (ii) Liabilities which have arisen since the Latest Balance Sheet Date in the Ordinary Course; (iii) Liabilities
that, individually or in the aggregate, are not material in amount; and (iv) Liabilities contemplated by this Agreement or the
other Company Transaction Documents.

 

    	 	- 10 -	 

     

    

 

		3.7.3	Governing Documents, Books and Records. True, correct and complete copies
of the Governing Documents, books of account, minute books, membership interest record books and other records of the Company have
heretofore been delivered or made available to the Buyer or its counsel. The books and records of the Company accurately reflect
the assets, liabilities, business, financial condition and results of operations of the Company and have been maintained in accordance
with good business and bookkeeping practices. On the Closing Date, such books and records will be in the possession of the Company.

 

		3.8	Absence of Certain Changes and Events. Since the Most Recent Fiscal Year End, the
Company has conducted the Business in the Ordinary Course and, except as expressly contemplated by this Agreement or any other
Transaction Document, there has not occurred any event or group of related events, condition, occurrence, contingency or development
that has had, or would reasonably be expected to have, a Material Adverse Effect. Without limiting the generality of the foregoing,
since the Most Recent Fiscal Year End, there has not been any, and/or the Company has not:

 

		3.8.1	change in the independent accountants of the Company or any change in the accounting methods, principles
or practices followed by the Company (except for any such change required by reason of a concurrent change in GAAP or applicable
Law);

 

		3.8.2	with respect to any executive, manager, officer, employee, consultant or contractor of the Company,
(a) adoption or termination in any respect, amendment or increase of the payments or benefits of any Employee Benefit Plan, (b)
grant of severance or termination pay, (c) increase in the compensation or payment of any bonus or (d) change with respect
to compensation or other benefits payable, except, in each of clauses (a) through (d), in the Ordinary Course, as required by Law
or as required by any existing Contract;

 

		3.8.3	sale, assignment, transfer, hypothecation, conveyance, lease, or other disposition of any asset
or property of the Company, except in the Ordinary Course, or mortgage, pledge, or imposition of any Lien on any asset or property
of the Company, except for Permitted Liens and except in the Ordinary Course;

 

		3.8.4	split, combined, classified, re-classified, varied the Rights attaching to, or taken similar action
with respect to any of the Transferred Interests or other Equity Interests or proposed the issuance of any other securities in
respect of, in lieu of or in substitution for its authorized or issued equity or other Equity Interests; granted any Rights to
purchase its Equity Interests; issued any Equity Interests; granted any registration rights; purchased, redeemed, retired, or otherwise
acquired any of its Equity Interests; or adopted a plan of complete or partial liquidation or passed any resolutions providing
for or authorizing such liquidation or a dissolution, merger, consolidation, restructuring, recapitalization or other reorganization
of the Company or declared or paid any dividend or other distribution or payment in respect of its Equity Interests;

 

		3.8.5	amended its Governing Documents;

 

    	 	- 11 -	 

     

    

 

		3.8.6	damaged, destroyed or lost any material portion of the tangible assets or properties of the Company,
whether or not covered by insurance, in an amount in excess of five thousand dollars ($5,000);

 

		3.8.7	except in the Ordinary Course, amended, renewed, failed to renew, terminated (other than due to
any scheduled expiration) or received written notice of termination (other than due to any scheduled expiration) with respect to
any Material Contract or entered into any new Material Contract or taken any action that would reasonably be expected to jeopardize
the continuance of any of its relationships with any of its Top Customers and/or Top Suppliers;

 

		3.8.8	(i) incurred or assumed any Indebtedness in excess of fifty thousand dollars ($50,000) in the aggregate,
(ii) assumed, guaranteed, endorsed or otherwise became liable or responsible (whether directly, contingently or otherwise) for
the Liabilities of any other Person (other than the endorsements of checks in the Ordinary Course) in excess of fifty thousand
dollars ($50,000) in the aggregate, or (iii) made any loans, advances or capital contributions to, or investment in, any Person,
in excess of fifty thousand dollars ($50,000) in the aggregate, other than employee travel and expense advances in the Ordinary
Course;

 

		3.8.9	paid, discharged or satisfied any Liabilities, other than the payment, discharge or satisfaction
in the Ordinary Course Liabilities reflected or reserved against in the Latest Balance Sheet or incurred in the Ordinary Course
since the Latest Balance Sheet Date;

 

		3.8.10	sold, disposed of or surrendered or disaggregated any material license or any portion thereof;

 

		3.8.11	accelerated or delayed collection of notes or accounts receivable in advance of or beyond their
regular due dates or the dates when the same would have been collected in the Ordinary Course;

 

		3.8.12	delayed or accelerated payments of any accounts payable or other liability beyond or in advance
of its due date or the date when such liability would have been paid in the Ordinary Course;

 

		3.8.13	failed to replenish inventories and supplies of the Company in the Ordinary Course or entered into
any purchase commitment not in the Ordinary Course;

 

		3.8.14	made any acquisition of all or any significant part of the assets, capital stock, other Equity
Interests, properties, securities or business of any other Person;

 

		3.8.15	made any revaluation of any assets of the Business of the Company or write down or write off of
the value of any assets of the Business of the Company, except in the Ordinary Course;

 

		3.8.16	entered into any collective bargaining Contract or any other Contract with any labor union or association representing any
group of employees, or been subject to any strike, picket, work stoppage, work slowdown or labor dispute or been subject to any
application for certification or union organizing drive;

 

    	 	- 12 -	 

     

    

 

		3.8.17	made any capital expenditure or any other investment (or series of related investments), or entered into any Contract or commitment
therefor, excluding any purchase of inventory in the Ordinary Course, in excess of fifty thousand dollars ($50,000) in respect
of any such individual investment or Contract or seventy-five thousand dollars ($75,000) in the aggregate;

 

		3.8.18	written down the value of any inventory (including write downs by reason of shrinkage or mark down)
or written off as uncollectible any notes or accounts receivable, except in the Ordinary Course;

 

		3.8.19	allowed any insurance policy naming the Company as beneficiary or loss payee to be cancelled or terminated, or instructed any
of the Company’s insurance carriers to decrease any current policy coverage limits or materially change the terms of such
coverage; or

 

		3.8.20	agreement by the Company to do any of the foregoing.

 

		3.9	Real Property.

 

		3.9.1	Section 3.9.1 of the Disclosure Schedule sets forth the address and description of each
parcel of real property owned (in fee simple or pursuant to an easement estate in perpetuity that runs with the land) by the Company
(“Owned Real Property”). With respect to each parcel of Owned Real Property, (a) the Company has good, insurable
and marketable fee simple title (or title by way of an easement estate), free and clear of all Liens, except Permitted Liens, (b)
the Company has not leased or otherwise granted to any Person the right to use or occupy such Owned Real Property or any portion
thereof, and (c) there are no outstanding options, rights of first offer or rights of first refusal to purchase such Owned Real
Property or any portion thereof or interest therein.

 

		3.9.2	Section 3.9.2 of the Disclosure Schedule sets forth the address of each parcel of real property
leased by the Company (the “Leased Real Property” and together with the Owned Real Property, the “Real
Property”), and a list of all leases for such Leased Real Property (“Real Property Leases”). With
respect to each of the Real Property Leases, (a) such Real Property Lease is legal, valid, binding, enforceable and in full force
and effect and the Company is not in default thereunder, and no condition or circumstance exists that, with the giving of notice
or passage of time, would constitute a default thereunder, (b) the Company’s possession and quiet enjoyment of the Leased
Real Property under such Real Property Lease has not been disturbed and there are no disputes with respect to such Real Property
Lease, (c) the Company has not subleased, licensed or otherwise granted any Person the right to use or occupy the Leased Real Property
or any portion thereof, (d) the Company has made available to Buyer true, correct and complete copies of all Real Property Leases,
and (e) the Company has a valid and enforceable leasehold interest in each Leased Real Property free and clear of all Liens other
than Permitted Liens.

 

		3.9.3	No Person other than the Company has any right to use or occupy any part of the Real Property.

 

    	 	- 13 -	 

     

    

 

		3.9.4	All buildings and all improvements located on the Real Property are in a state of good maintenance
and repair (normal wear and tear excepted) and in a condition adequate and reasonably suitable for the conduct therein of the Business.
The heating, ventilation, air conditioning, plumbing and electrical systems at the Real Property are in good working order and
repair (normal wear and tear excepted). The Company has not experienced any interruption in such services provided to any of the
premises located on the Real Property within the last year.

 

		3.9.5	To the extent required by Law, the Company has obtained all permits, licenses, franchises, approvals and authorizations (collectively,
the “Real Property Permits”) of (i) all Governmental Authorities having jurisdiction over any of the premises
comprising the Real Property and (ii) all insurance companies and fire rating and other similar boards and organizations having
jurisdiction over any of the premises comprising the Real Property (collectively, the “Insurance Organizations”).
All such Real Property Permits are set forth on Section 3.9.5 of the Disclosure Schedule and have been issued to the Company
to enable each of the premises comprising the Real Property to be lawfully occupied and used by the Company for all of the purposes
for which they are currently occupied and used and are in full force and effect. The Company has not received any written notice
from any Governmental Authority having jurisdiction over any premises comprising the Real Property, or from any Insurance Organization,
threatening a suspension, revocation, modification or cancellation of any Real Property Permit or of any insurance policies, and
there exists no violation of a Real Property Permit. Each Real Property Permit is in full force and effect.

 

		3.9.6	There is no pending or, to the Company’s Knowledge, threatened condemnation or eminent domain
proceeding with respect to or affecting any of the premises comprising the Real Property or any part thereof. The Company has not
received any written, or, to the Company’s Knowledge, oral notice of any pending or threatened condemnation or eminent domain
proceeding with respect to or affecting any of the premises comprising the Real Property or any part thereof and, to the Company’s
Knowledge, no such condemnations or proceedings have been proposed. The Company has not received any written notice of any Environmental
Claims with respect to or affecting the Real Property.

 

		3.9.7	The Real Property comprises all of the real property used or intended to be used in the Business,
and, other than the Real Property Leases, the Company is not a party to any other agreement which includes any option to purchase
or lease any real property or interest therein.

 

		3.9.8	The improvements on the Owned Real Property are located within the boundary lines of such parcels
and, to the Company’s Knowledge, all utility service lines serving such Owned Real Property are located either within the
boundary lines of such property or within lands dedicated to public use or within recorded easements for same.

 

		3.9.9	To the Company’s Knowledge, no portion of the Owned Real Property is subject to any significant
real property Tax increases or recapture of Taxes occasioned by retroactive revaluation, special assessments, change in the land
usage, or loss of any exemption or benefit status.

 

    	 	- 14 -	 

     

    

 

		3.9.10	There are no encroachments upon the Owned Real Property from adjacent properties nor encroachments
of any improvement located on the Owned Real Property upon adjoining land or upon easements encumbering the Owned Real Property.

 

		3.9.11	The Company has not received any written notice of, and to the Company’s Knowledge, no landlord
of any Leased Real Property has any plans to make, any material alterations to any of the Leased Real Property.

 

		3.9.12	All sums owed by any landlord to the Company under any Real Property Lease have been paid, including,
but not limited to, tenant improvement allowances.

 

		3.9.13	No underground tank or other underground storage receptacle used to contain Hazardous Materials
is currently located at any of the Owned Real Property or, to the Company’s Knowledge, any of the Leased Real Property.

 

		3.9.14	The Company’s use of the Real Property does not violate the permitted use of the easement
set forth on Section 3.9.14 of the Disclosure Schedule.

 

		3.10	Material Contracts.

 

		3.10.1	Section 3.10.1 of the Disclosure Schedule lists the following Contracts in effect
on the date of this Agreement to which the Company is a party, has any rights or Liabilities or is otherwise bound or to which
the Company is not a party that is used in connection with the Business (and in the case of oral Contracts, summaries thereof),
and pursuant to which the Company has obligations (collectively, the “Material Contracts”):

 

		(a)	(i) each Contract that is executory in whole or in part and involves performance of services (other
than sale or purchase orders for goods or materials) by or for the Company of an amount or value in excess of fifty thousand dollars
($50,000), except for any such Contract entered into in the Ordinary Course, and (ii) each Contract, that is executory in whole
or in part and involves the sale or purchase of goods or materials by the Company of an amount or value in excess of fifty thousand
dollars ($50,000), except for sales of inventory in the Ordinary Course and sales of obsolete assets;

 

		(b)	each Contract that is executory in whole or in part and was not entered into in the Ordinary Course
that involves expenditures or receipts in excess of fifty thousand dollars ($50,000) in respect of an individual Contract or fifty
thousand dollars ($50,000) in the aggregate for any number of Contracts entered into for like services, goods or materials or with
an individual party;

 

		(c)	each Contract with a Top Customer or Top Supplier, other than purchase orders entered into in the
Ordinary Course;

 

		(d)	each Contract granting an option or preferential rights to purchase, sell or license any assets
of the Company having a value in excess of twenty-five thousand dollars ($25,000);

 

    	 	- 15 -	 

     

    

 

		(e)	each Contract that involves product development, product enhancement or product customization obligations;

 

		(f)	each Contract that is for outstanding capital expenditures by the Company in excess of fifty thousand
dollars ($50,000);

 

		(g)	each Contract that relates to the acquisition of any business or Equity Interests or assets of
any other Person or any real property (whether by merger, sale of Equity Interests, sale of assets or otherwise and whether or
not completed), in each case, involving aggregate consideration in excess of one hundred thousand dollars ($100,000) (including
any deferred purchase price, earnout or other consideration);

 

		(h)	each Contract between or among the Company, on the one hand, and the Sellers, any Affiliate of
the Company or the Sellers, or any manager or officer of the Company, the Sellers or any Affiliate of the Company or the Sellers,
on the other hand;

 

		(i)	each (i) Real Property Lease or sublease, rental or occupancy Contract, license, installment and
conditional sale Contract and (ii) other Contract affecting the ownership of, leasing of, title to, use of, or any leasehold or
other interest in, any real or personal property, other than (A) Contracts for services, repair, construction or maintenance with
payment obligations not exceeding fifty thousand dollars ($50,000) per Contract or fifty thousand dollars ($50,000) in the aggregate
for any number of Contracts entered into for like services, goods or materials or with an individual party if such Contracts were
entered into in the Ordinary Course and (B) purchase orders entered into in the Ordinary Course;

 

		(j)	each collective bargaining Contract and any other Contract with any labor union, trade union or
other employee representative, body or organization of a group of employees of the Company;

 

		(k)	each joint venture, partnership, limited partnership or similar Contract involving a sharing of
profits, losses, costs or Liabilities by the Company with any other Person;

 

		(l)	each Contract (i) containing outstanding covenants or other obligations (other than customary confidentiality
and non-disclosure obligations entered into in the Ordinary Course) that restricts the business activity of the Company or limits
the freedom of the Company to engage in any line of business, to compete (geographically or otherwise) with any Person or to solicit
for hire or employ any Person, (ii) granting any exclusive rights to make, sell or distribute the Company’s products, (iii)
granting any “most favored nations” or similar rights or (iv) otherwise prohibiting or limiting the right of the Company
to make, sell or distribute any products or services;

 

		(m)	each Contract that is a confidentiality agreement or non-disclosure agreement, other than (i) proprietary
information and investment assignment Contracts with current or former directors, officers, employee or consultants or other services
providers of the Company in the Ordinary Course and (ii) that certain letter agreement dated December 16, 2016, between Houlihan
Lokey Capital, Inc. and the Company;

 

    	 	- 16 -	 

     

    

 

		(n)	each Contract relating to the Company providing for payments to or by any Person based on sales,
purchases, or profits, other than direct payments for goods or services;

 

		(o)	each power of attorney that is currently effective and outstanding granted by the Company;

 

		(p)	(i) each written warranty, guaranty, and/or other similar undertaking with respect to a contractual
performance of another Person extended by the Company and (ii) each Contract pursuant to which the Company has agreed to indemnify
another Person or to share in or contribute to the Liability of any Person, in each case other than Contracts in the Ordinary Course;

 

		(q)	each Contract that is a settlement agreement with respect to any pending or threatened Proceeding
entered into within three (3) years prior to the date of this Agreement;

 

		(r)	each written or oral Contract with any employee, consultant, manager or officer of the Company,
including any employment or compensation agreements, except for employment or consulting agreements entered into in the Ordinary
Course with a total value of less than fifty thousand ($50,000) on an individual basis and offer letters for at-will employment
which do not provide for retention or severance payments or any other similar benefit;

 

		(s)	each written or oral Contract that provides for retention, severance, termination or similar pay
to any current or former employee, consultant, manager or officer of the Company;

 

		(t)	each Contract with outstanding obligations or liability, contingent or otherwise, to which the
Company is a party or is otherwise bound relating to the purchase, sale or lease of real property;

 

		(u)	each Contract imposing a Lien upon any asset of the Company, other than Permitted Liens;

 

		(v)	each Contract related to Company Intellectual Property;

 

		(w)	each Contract by which the Company licenses any Person to manufacture or reproduce any of the Company’s
products, services or technology or any Contract to sell or distribute any of the Company’s products, services or technology;

 

		(x)	each Contract providing for the payment of cash or other compensation or benefits upon consummation
of the transactions contemplated hereby;

 

		(y)	each sales distribution or franchise Contract that is (i) not terminable without penalty on ninety
(90) days’ notice or less and (ii) provides for compensation at an amount or rate which is higher than is customary or usual
in the Business;

 

    	 	- 17 -	 

     

    

 

		(z)	each Contract entered into with any international or federal Governmental Authority; or

 

		(aa)	each other Contract that is material to the Business or the operation of the Company.

 

		3.10.2	The Company is in compliance with all Material Contracts. Neither the Company nor, to the Company’s
Knowledge, any other party to any Material Contract is in default in respect of such Material Contract. Neither the Company nor
any Seller has received written notice or, to the Company’s Knowledge, oral notice of an uncured breach or default or a pending
or threatened cancellation, revocation or termination of any Material Contract and no event has occurred and no condition or state
of facts exists which, with the passage of time or the giving of notice or both, would constitute such a default or breach by the
Company or by any such other party.

 

		3.10.3	Each Material Contract is in full force and effect and constitutes a valid and binding obligation
of the Company and, to the Company’s Knowledge, the other parties thereto, in accordance with its terms, except in each case
as such enforcement may be limited by the Remedies Exception, and is not subject to any claims, charges, set-offs or defenses.

 

		3.10.4	The Company has delivered or otherwise made available to Buyer or its counsel complete, true and
correct copies of all of the written Material Contracts (including all amendments, exhibits, attachments, extensions, renewals,
guaranties, modifications, waivers, supplements and other agreements, if any, related thereto), or a written description of the
material terms of any oral Material Contract. The Company is not renegotiating any of the Material Contracts.

 

		3.10.5	To the Company’s Knowledge, no employee or consultant or other independent contractor of
the Company is a party to, or is otherwise bound by, any Contract, including any confidentiality, noncompetition or proprietary
rights Contract, with any other Person that adversely affects or will affect (i) the performance of his or her duties for
the Company, (ii) his or her ability to assign to the Company rights to any invention, improvement, discovery or information
relating to the Business, or (iii) the ability of the Company to conduct the Business as currently conducted.

 

		3.10.6	Section 3.10.6 of the Disclosure Schedule sets forth true, complete and correct list of
all forms of written customer Contracts currently used by the Company with its twenty (20) largest customers (as measured by dollar
volume of sales) for the year ended December 31, 2016 (the “Customer Contract Forms”). The Company has made
available to the Buyer true, complete and correct copies of all Customer Contract Forms.

 

    	 	- 18 -	 

     

    

 

		3.11	Insurance. Section 3.11 of the Disclosure Schedule contains a true and complete
list and description of all insurance policies, other insurance arrangements and other Contracts owned by, or maintained for the
benefit of, or for the transfer or sharing of insurance risks by, the Company in force on the date hereof with respect to the business
or assets of the Company (the “Company Insurance Policies”), together with the deductible and coverage limit
of each such Company Insurance Policy and a statement of the aggregate amount of claims paid out, and claims pending, under each
such Company Insurance Policy. The Company Insurance Policies provide the type and amount of coverage customarily carried by businesses
of similar size in the same industry. Each Company Insurance Policy is legal, valid, binding, enforceable and in full force and
effect with respect to the Company, as applicable, and, to the Company’s Knowledge, with respect to the other parties thereto.
The Company is not in breach or default (including with respect to the payment of premiums or the giving of notices) under any
Company Insurance Policy, and no event has occurred which, with notice or the lapse of time, would constitute such a breach or
default or permit termination, modification or acceleration, under any such Company Insurance Policy. The Company has not received
any written notice of cancellation or non-renewal of any of the Company Insurance Policies nor, to the Company’s Knowledge,
is the termination of any of the Company Insurance Policies threatened. There is no claim pending under any of the Company Insurance
Policies as to which coverage has been questioned, denied or disputed by the underwriters of such policies. The Company has not
received any written notice from any of its insurance carriers that any insurance coverage presently provided for in any Company
Insurance Policy will not be available to the Company in the future on similar terms as now in effect (excepting general market
pricing increases and coverage limitations). The Company does not maintain any self-insurance. All premiums due and payable under
all Company Insurance Policies have been paid, the Company is not liable for any retroactive premiums or similar payments, and
the Company is otherwise in compliance with the terms of such policies.

 

		3.12	Permits. The Company has obtained all Governmental Authorizations necessary for
                                                                   the Company to own, lease and operate and to carry on the Business. All such Governmental Authorizations are set forth on Section
                                                                   3.12 of the Disclosure Schedule, are in full force and effect, and no written or, to the Company’s Knowledge, oral
                                                                   notice from any Governmental Authority of any pending violation, removal, revocation or non-renewal has been received by the
                                                                   Company in respect of any such Governmental Authorizations. To the Company’s Knowledge, the Company does not have any
                                                                   Governmental Authorization that will not be renewed in the ordinary course or will be revoked, terminated, suspended or
                                                                   impaired nor to the Company’s Knowledge are there any circumstances that would or may reasonably be expected to result
                                                                   in the same. The consummation of the transactions contemplated hereunder and the operation of the business of the Company by
                                                                   the Buyer in the manner in which the Company currently operates will not require or result in the transfer of any
                                                                   Governmental Authorization that may not be transferred without the consent or approval of any Governmental Authority or other
                                                                   Person.

 

		3.13	Tangible Personal Property. The Company has good and valid title to, or a valid leasehold
interest in, the tangible personal property used in the conduct of the Business, reflected on the Latest Balance Sheet or acquired
since the date thereof, free and clear of all Liens (except Permitted Liens), except assets disposed of in the Ordinary Course
since the Latest Balance Sheet Date. The tangible personal property owned or used by the Company is in good operating condition
and repair, ordinary wear and tear excepted. Nothing in this Section 3.13 will apply to Intellectual Property
matters, which are addressed in Section 3.14.

 

		3.14	Intellectual Property.

 

		3.14.1	The Company owns or has the valid right to use all Intellectual Property used in connection with
or necessary to conduct the Business of the Company as presently conducted (such Intellectual Property, together with the Company
Owned Intellectual Property and the Company Licensed Intellectual Property, the “Company Intellectual Property”).

 

    	 	- 19 -	 

     

    

 

		3.14.2	Set forth on Section 3.14.2 of the Disclosure Schedule is a complete and accurate list (showing
in each case, the registered owner, title, mark or name, applicable jurisdiction, application number or registration number and
date of application, if any) of all United States, foreign and state (i) Patents and Patent applications, (ii) Trademark registrations
and applications and all unregistered Trademarks, (iii) internet domain names, and (iv) Copyright registrations and applications
owned by the Company, in each case, that is owned by the Company, but excluding any items that are abandoned, cancelled, expired,
withdrawn, or finally refused without right of appeal (together with all other Intellectual Property owned by the Company, the
“Company Owned Intellectual Property”).

 

		3.14.3	Set forth on Section 3.14.3 of the Disclosure Schedule is a complete and accurate list of
(i) each Contract that is in effect pursuant to which the Company uses the Intellectual Property owned by another Person in the
conduct of the Business, but excluding (A) software shrink-wrap, open source, click-through or similar agreements, (B) non-disclosure
agreements, and (C) agreements with current and former employees, consultants, and independent contractors of the Company entered
into on the Company’s standard form(s) (or a substantially similar form) (together with all other Intellectual Property owned
by another Person that is licensed to the Company and used in the conduct of the Business, the “Company Licensed Intellectual
Property”) and (ii) each Contract that is in effect pursuant to which the Company grants to another Person the right
to use any Company Intellectual Property, but excluding agreements under which the only right or license granted to another Person
under Company Owned Intellectual Property is for the purpose of such Person performing services for the sole benefit of the Company
(all Contracts required to be disclosed on Section 3.14.3 of the Disclosure Schedule, the “Company IP Agreements”).

 

		3.14.4	The Company is the sole and exclusive legal and beneficial owner of all rights, title and interests
in and to the Company Owned Intellectual Property. Each of the Company Owned Intellectual Property registrations and applications
and common law Trademarks set forth on Section 3.14.2 of the Disclosure Schedule are valid and subsisting, in full force
and effect, and have not been cancelled, expired, or abandoned and all renewal fees and other steps required for the maintenance
or protection of such rights have been paid on time or taken. No facts or circumstances exist that would reasonably be expected
to render any of the Company Owned Intellectual Property invalid or unenforceable. There are no pending or, to the Company’s
Knowledge, threatened opposition, interference, re-examination or cancellation proceedings or any similar proceedings before any
court or registration authority or other Governmental Authority in any jurisdiction against the Company Owned Intellectual Property.
The Company has not received any written notice or, to the Company’s Knowledge, oral notice of any pending or threatened
opposition, interference, re-examination or cancellation proceedings or any similar proceedings before any court or registration
authority or other Governmental Authority in any jurisdiction against the Company Intellectual Property. There has been and is
no Proceeding or Law asserted, pending or, to Company’s Knowledge, threatened that prohibits or restricts the Company from
any use or any other exploitation of the Company Owned Intellectual Property. No Person has any exclusive license under any of
the Company Intellectual Property.

 

    	 	- 20 -	 

     

    

 

		3.14.5	Neither the conduct of the Business nor the Company’s creation, use, license or other transfer
of the Company Intellectual Property or the Company’s Products or services, or to the Company’s Knowledge, a Company
customer’s use of the Company’s Products or services as authorized by the Company, has infringed, misappropriated or
otherwise violated or infringes, misappropriates or otherwise violates the Intellectual Property of any Person. The Company has
not received written notice, or, to the Company’s Knowledge, oral notification that the conduct of the Business, the creation,
use, license or other transfer of the Company Intellectual Property or the Company’s or, to the Company’s Knowledge,
a Company customer’s use of the Company’s Products or services has infringed, misappropriated or otherwise violated,
or infringes, misappropriates or otherwise violates, any Intellectual Property owned or controlled by any Person (either directly
or indirectly such as through contributory infringement or inducement to infringe) or is defamatory or violative in any way of
any publicity, privacy, or other rights. The Company has not received any notice of any pending or any written or, to the Company’s
Knowledge, oral notification of any pending or threatened claims or suits (i) alleging that the activities of the Company or the
conduct of its Business or the creation, use, license or other transfer of the Company Intellectual Property or the Company’s
use of the Company’s Products or services infringes upon or constitutes the unauthorized use of or otherwise violates the
Intellectual Property of any Person, nor alleging libel, slander, defamation, or other violation of a personal right, or (ii) challenging
the ownership, use, registration, validity or enforceability of any Company Intellectual Property.

 

		3.14.6	To the Company’s Knowledge, no third party has disclosed in violation of any confidentiality
obligation, misappropriated, infringed, diluted, or otherwise violated, or is currently using, disclosing in violation of any confidentiality
obligation, misappropriating, infringing, diluting, or otherwise violating, any Company Owned Intellectual Property, and no such
claims are pending against any Person by the Company. The Company has not commenced or threatened in writing any Litigation, or
asserted any allegation or claim, against any Person for infringement or misappropriation of the Company Owned Intellectual Property
or breach of any Contract involving the Company Intellectual Property.

 

		3.14.7	No Proceedings are currently pending or, to the Company’s Knowledge, threatened in writing,
that the Company is infringing, violating, or misappropriating any third-party Intellectual Property.

 

		3.14.8	The Company takes commercially reasonable actions to protect, preserve and maintain all Trade Secrets
and other confidential information included in the Company Intellectual Property. The Company has taken commercially reasonable
steps necessary to comply with all duties of the Company to protect the confidentiality of confidential information provided to
the Company by any other Person. To the Company’s Knowledge, none of the current or former employees, consultants or other
independent contractors of the Company has violated any agreements under which the Company has agreed to keep confidential any
information of another Person.

 

    	 	- 21 -	 

     

    

 

		3.15	Labor Matters.

 

		3.15.1	There is no labor strike, sympathy strike, dispute, union disturbance, corporate campaign, slowdown,
sit-down, stay-in, sick-out, walk-out, work stoppage or lockout, boycott or similar labor difficulty or other union interference
against or affecting the Company (all of the foregoing referred to as “Work Interference”) and, to the Company’s
Knowledge, no Work Interference is threatened. Since January 1, 2014, no Work Interference has occurred or was threatened.

 

		3.15.2	(i) The Company has not entered into and is not a party to, either directly or by operation of
law, any collective agreement, collective bargaining contract, letters of understanding, letters of intent or other written communication
or Contract with any trade union, labor union or association or organization that may qualify as a trade union, labor union or
association, contingent or otherwise, which would cover any employee of the Company (the “Employees”); and (ii)
the Employees are not subject to any collective bargaining agreements or letters of understanding, letters of intent or other written
communication or Contract with any trade union, labor union or association or organization that may qualify as a trade union, labor
union or association, contingent or otherwise, and are not, in their capacities as Employees, represented by any trade union, labor
union or association or organization that may qualify as a trade union or association.

 

		3.15.3	(i) No labor representatives hold bargaining rights with respect to any Employee of the Company
by way of certification, interim certification, voluntary recognition, designation or successor rights; (ii) no labor representatives
have applied to be certified as the bargaining agent of any Employee of the Company; and (iii) no labor representatives have applied
to have the Company declared a related or successor employer. There are no organizational efforts currently being made or, to the
Company’s Knowledge, threatened by or on behalf of, any trade union or association or organization that may qualify as a
trade union, labor union or association with respect to the Employees and there have been no such organizing within the last three
(3) years.

 

		3.15.4	A true and complete copy of each current written employee policies, employee manuals or other written
statements of rules or policies as to working conditions, vacation and sick leave, personnel policy, rule and procedure applicable
to the Employees has been delivered or made available to the Buyer or its counsel and is listed on Section 3.15.4 of the Disclosure
Schedule.

 

		3.15.5	The Company is in compliance, in all material respects, with all applicable Laws respecting employment
and employment practices, terms and conditions of employment, wages, pay equity, hours of work and occupational safety and health,
and is not engaged in any unfair labor practices, as defined in the National Labor Relations Act or other applicable Laws.

 

		3.15.6	The Company has not received written notice that an unfair labor practice charge or complaint against
the Company is pending before the National Labor Relations Board or any similar state or foreign agency, nor, to the Company’s
Knowledge, has such a charge or complaint been threatened in writing.

 

    	 	- 22 -	 

     

    

 

		3.15.7	No charge with respect to or relating to the Company is pending before the Equal Employment Opportunity
Commission or any other agency responsible for the prevention of discriminatory or other unlawful employment practices.

 

		3.15.8	Since January 1, 2014, (a) the Company has not effectuated a “plant closing” (as defined
in the WARN Act or any comparable provision of state, local or foreign Law) affecting any site of employment or one or more facilities
or operating units within any site of employment or facility of the Company, (b) there has not occurred a “mass layoff”
(as defined in the WARN Act or any comparable provision of state, local or foreign Law) affecting any site of employment or facility
of the Company, (c) the Company has not been affected by any transaction or engaged in layoffs or employment terminations sufficient
in number to trigger application of any similar state, local or foreign “plant closing” Law or regulation and (d) none
of the Employees has suffered an “employment loss” (as defined in the WARN Act or any comparable provision of state,
local or foreign Law) during the six month period prior to the date hereof.

 

		3.16	Employee Benefits.

 

		3.16.1	Section 3.16.1 of the Disclosure Schedule contains a list of all “employee benefit
plans” within the meaning of Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”),
and all material bonus, pension, profit sharing, deferred compensation, incentive compensation, stock option, equity incentive,
phantom stock, retirement, vacation, severance, disability, death benefit, hospitalization, medical or other compensatory plan,
program or arrangement maintained by, or contributed to by, the Company or with respect to which the Company has any liability
(the plans so listed, collectively, “Employee Benefit Plans”). Except as would not result in liability to the
Company, each Employee Benefit Plan has been administered in material compliance with its terms and applicable Laws, including
ERISA and the Code. The Company has made available to Buyer true, complete and correct copies of (i) the document, if any,
constituting such Employee Benefit Plan, (ii) the most recent annual report on Form 5500 filed with the Internal Revenue Service
with respect to each Employee Benefit Plan (if any such report was required), (iii) any Internal Revenue Service or Department
of Labor determination, opinion, notification and advisory letters, and (iv) all correspondence to or from any Governmental Authority
relating to any Employee Benefit Plan received in the last two (2) years prior to the date of this Agreement.

 

		3.16.2	No Employee Benefit Plan or other plan maintained, contributed to or required to be contributed
to by any ERISA Affiliate is a “multiemployer plan” within the meaning of Section 4001(a)(3) of ERISA, and no Employee
Benefit Plan or other plan maintained, contributed to or required to be contributed to by any ERISA Affiliate is subject to Title
IV of ERISA or the minimum funding standards of Section 412 of the Code. Except as would not result in liability to the Company,
no “Prohibited Transaction,” within the meaning of Section 4975 of the Code or Sections 406 or 407 of ERISA and not
otherwise exempt under Section 408 of ERISA, has occurred with respect to any Employee Benefit Plan.

 

    	 	- 23 -	 

     

    

 

		3.16.3	The execution and delivery by the Company of this Agreement does not and the consummation of the
Transactions and compliance with the terms hereof will not either alone or in conjunction with any other event (other than any
event that independently triggers the results in the following clauses (i) - (ii) of this Section 3.16.3), (i) entitle
any current employee, officer or director of the Company to severance pay, or (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 Employee Benefit Plan. There is no contract, plan or arrangement covering
any current or former employee, director or consultant of the Company that, individually or collectively, could give rise to the
payment as a result of the transactions contemplated by this Agreement of any amount that would not be deductible by the Company
by reason of Section 280G of the Code.

 

		3.16.4	No Employee Benefit Plan is maintained outside the jurisdiction of the United States, or covers
any employee residing or working outside the United States.

 

		3.16.5	No audit or investigation of an Employee Benefit Plan by a Governmental Authority has occurred
in the past three (3) years and there are no actions, suits or claims (other than routine claims for benefits) pending or, to the
Company’s Knowledge, threatened in writing with respect to any Employee Benefit Plan.

 

		3.16.6	Prior to the date hereof, the Buyer has been provided with a true and complete list of the names,
titles and current salaries of all full-time and part-time employees and consultants of the Company. There is no employment Contract,
employee benefit or incentive compensation plan or program, severance policy or program or any other plan or program to which the
Company is a party (i) that is or could, pursuant to its terms, be triggered or accelerated by reason of or in connection with
the execution of this Agreement or the consummation of the transactions contemplated by this Agreement or (ii) which contains “change
in control” provisions pursuant to which the payment, vesting or funding of compensation or benefits would be triggered or
accelerated by reason of or in connection with the execution of or consummation of the transactions contemplated by this Agreement.

 

		3.17	Environmental Matters.

 

		3.17.1	The operations of the Company are in compliance with all Environmental Permits applicable to the
Business;

 

		3.17.2	The Company is not subject to any pending claim and has not received any threat in writing alleging
that the Company is in violation of any Environmental Law or any Environmental Permit or has any liability under any Environmental
Law; and

 

		3.17.3	There are no Proceedings pursuant to Environmental Law pending or, to the Company’s Knowledge,
threatened in writing against the Company before any Governmental Authority, and the Company is not subject under any Environmental
Law to any Judgment.

 

    	 	- 24 -	 

     

    

 

		3.18	Tax Matters.

 

		3.18.1	The Company has timely filed, or has caused to be timely filed on its behalf, all federal, state,
county and local Tax Returns required to be filed by it (each a “Company Return” and collectively, the “Company
Returns”), and all such Tax Returns are true, complete and accurate. The Company has paid all Taxes shown to be due by
the Company in such Company Returns as well as all other Taxes, assessments and governmental charges that have become due or payable,
including all Taxes that the Company is obligated to withhold or collect from amounts owing to employees, creditors and third parties,
which have been timely withheld or collected, as the case may be, and to the extent required by applicable Law, have been paid
to the relevant Taxing Authority or Governmental Authority.

 

		3.18.2	The Latest Balance Sheet contains an adequate accrual in accordance with GAAP for all unpaid Taxes
as of the Latest Balance Sheet Date. The Company has not incurred any liability for Taxes subsequent to the Latest Balance Sheet
Date except in the Ordinary Course.

 

		3.18.3	No written claim has ever been made by any Governmental Authority in a jurisdiction where the Company
does not file Tax Returns that it is or may be subject to taxation or to a requirement to file Tax Returns in such jurisdiction,
which claim has not be resolved.

 

		3.18.4	The Company has complied in all material respects with all applicable Laws relating to the payment
and withholding of Taxes from Employees and other Persons.

 

		3.18.5	There are no Liens for Taxes (other than for current Taxes not yet due and payable), whether imposed
by a federal, state, county, or local Taxing Authority, outstanding against the assets, properties or business of the Company (other
than Permitted Liens) on the assets and/or Equity Interests of the Company.

 

		3.18.6	The Company is not a party to or bound by any Tax Agreement.

 

		3.18.7	The Company has not been the “distributing corporation” or the “controlled corporation”
(in each case, within the meaning of Section 355(a)(1) of the Code) with respect to a transaction described in Section 355 of the
Code (i) within the two (2)-year period ending as of the date of this Agreement, or (ii) in a distribution that could
otherwise constitute part of a “plan” or “series of related transactions” (within the meaning of Section
355(e) of the Code) that includes the Transactions.

 

		3.18.8	The Company (i) has not been a member of any affiliated group filing a consolidated Tax Return
or of any affiliated, consolidated, combined, or unitary group, as defined under applicable state, local or foreign Law, and (ii)
does not have any liability for the Taxes of any Person under Section 1.1502-6 of the Treasury Regulations (or any similar provision
of state, local or foreign Law), or as a transferee or successor.

 

		3.18.9	No claim, deficiency, assessment for any income Taxes has been asserted against the Company or
any former Subsidiaries of the Company which has not been resolved and/or paid in full.

 

    	 	- 25 -	 

     

    

 

		3.18.10	There are no pending Tax audits or examinations of any Tax Returns of the Company. The Company
has not waived any statute of limitations with respect to Taxes or agreed to any extension of time with respect to a Tax assessment
or deficiency, which waiver is still outstanding.

 

		3.18.11	In the three (3) years prior to the date of this Agreement, the Company has not engaged in a “reportable
transaction,” as set forth in Treasury Regulation Section 1.6011-4(b)(1).

 

		3.18.12	Notwithstanding any other provision of this Agreement, none of any Seller or the Company is making
or will be construed to have made any representation or warranty as to (i) the amount or availability of any tax attribute of the
Company or (ii) any Tax position that Sellers or any of their respective Affiliates (including the Company) may take in or in respect
of a Post-Closing Tax Period.

 

		3.19	Customers and Suppliers.

 

		3.19.1	Section 3.19.1 of the Disclosure Schedule sets forth the twenty (20) largest customers (as
measured by dollar volume of sales) of the Company (the “Top Customers”) for both of the years ended December
31, 2016 and December 31, 2015 and includes the actual amount for which each such Top Customer was invoiced by the Company during
such periods. Since the Most Recent Fiscal Year End, the Company has not received any written or, to the Company’s Knowledge,
oral notice from any Top Customer to the effect that such customer is terminating its business relationship with the Company and
will stop purchasing products from the Company prior to the termination of any existing agreement with such Top Customer. There
are no pending disputes or controversies between the Company and any of the Top Customers and, to the Company’s Knowledge,
none of the Top Customers (i) has or is contemplating terminating or materially diminishing its business or relationship with the
Company or (ii) has experienced any material work stoppage or other material adverse circumstances or conditions that is reasonably
likely to jeopardize or materially adversely affect the future relationships of the Company with such Person. To the Company’s
Knowledge, there is no fact, condition or event which would adversely affect the relationship of the Company with any of its Top
Customers.

 

		3.19.2	Section 3.19.2 of the Disclosure Schedule sets forth the twenty (20) largest suppliers (as
measured by dollar volume of purchases) of the Company (the “Top Suppliers”), for both of the years ended December
31, 2016 and December 31, 2015 and includes the actual amount the Company purchased from each such supplier during such period
(treating affiliated suppliers as a single supplier). Since the Most Recent Fiscal Year End, the Company has not received any written
or, to the Company’s Knowledge, oral notice from any Top Supplier to the effect that such Top Supplier is terminating its
business relationship with the Company and will stop providing products or services to the Company, prior to the termination of
any existing agreement with such Top Supplier. There are no pending disputes or controversies between the Company and any of the
Top Suppliers and, to the Company’s Knowledge, none of the Top Suppliers (i) has or is contemplating terminating or materially
diminishing its business or relationship with the Company or (ii) has experienced any material work stoppage or other material
adverse circumstances or conditions that is reasonably likely to jeopardize or materially adversely affect the future relationships
of the Company with such Person. To the Company’s Knowledge, there is no fact, condition or event which would adversely affect
the relationship of the Company with any of its Top Suppliers.

 

    	 	- 26 -	 

     

    

 

		3.20	Inventory; Accounts Receivable.

 

		3.20.1	All of the inventories of stock in trade, work in progress and finished goods of the Company consist
of a quality and quantity usable and salable in the Ordinary Course, except for obsolete, damaged or defective inventory and materials
of below-standard quality, all of which items have been written off or written down on the books and records of the Company to
fair market value or for which adequate reserves have been provided therein. All inventories not written off have been priced at
the lower of cost or realizable market value. All inventories disposed of subsequent to the Most Recent Fiscal Year End have been
disposed of only in the Ordinary Course. The quantities of each type of inventory (whether raw materials, work-in-process, or finished
goods) are not excessive, but are reasonable and warranted according to the normal purchasing and sales patterns of the Company
and are adequate for the purposes of fulfilling the Company’s current business and order requirements. All work in process
and finished goods inventory held by the Company is free of any Defect or other material deficiency.

 

		3.20.2	Section 3.20.2 of the Disclosure Schedule contains a list of the aged trade accounts receivable
of the Company as of June 30, 2017 (“Receivables”). Such Receivables arose in the Ordinary Course for goods
sold and delivered or services provided by the Company as to which full performance by the Company has been fully rendered, constitute
valid obligations owed to the Company and are collectible in the Ordinary Course, subject to customary reserves. The Company has
not received any written notice from or on behalf of any account debtor asserting any defense to payment, counterclaim or right
of setoff with respect to any Receivable of the Company in excess of amounts reserved on the Financial Statements in respect of
the applicable period(s). All Receivables are recorded and booked on the books and records of the Company in accordance with GAAP.
No Receivables are subject to prior assignment or Lien (other than Permitted Liens). Except as set forth in the Financial Statements,
the Company does not have any liability for any refunds, liability allowances or returns in respect of products developed, manufactured,
processed, distributed or sold by or for the account of the Company on or prior to the Closing Date in excess of the amounts specifically
reserved against in calculating the Estimated Closing Working Capital. Where Receivables arose out of secured transactions, all
financing statements and other instruments required to be filed or recorded to perfect the title or security interest of the Company
have been properly filed or recorded by the Company.

 

		3.21	Related Party Transactions. None of the Sellers or any current manager, officer or
Affiliate of any of the Sellers or the Company: (a) is, or owns, directly or indirectly, any interest in any Person which is, (i)
a competitor of the Company, (ii) a supplier of the Company, or (iii) a customer of the Company or a distributor of the Products
(except as an owner of two percent (2%) or less of the stock of any Person listed on a national securities exchange or traded in
the over-the-counter market); (b) owns, directly or indirectly, in whole or in part, any property, asset or right, real, personal
or mixed, tangible or intangible (including, but not limited to, any of the intangible property), of the Company, which is utilized
in the operation of the Business; (c) has an interest in or is, directly or indirectly, a party to any Material Contract pertaining
or relating to the Company, except for employment, consulting or other personal service Contracts that may be in effect and which
are set forth on Section 3.21 of the Disclosure Schedule; or (d) has any Proceeding against, or owes any amount to, the
Company.

 

    	 	- 27 -	 

     

    

 

		3.22	Brokers. Except for Houlihan Lokey Capital, Inc., no investment banker, broker, finder
or other intermediary has acted on the Company’s behalf in connection with this Agreement and the Transactions and except
for fees payable to Houlihan Lokey Capital, Inc., there are no brokerage commissions, finders’ fees or similar fees or commissions
payable in connection therewith based on any Contract with the Company or any action taken by the Company or based upon arrangements
or agreements made by or on behalf of the Company.

 

		3.23	Banking Relationships. Section 3.23 of the
Disclosure Schedule sets forth (a) the names and locations of the banking and lock box accounts of the Company and any safe
deposit boxes of the Company and (b) the credit card issuers with whom the Company has an account and, in each case, the names
of all Persons authorized to use such accounts or who have access thereto. There are no automatic, periodic or scheduled withdrawals
or debits with respect to any of the bank accounts required to be set forth on Section 3.23 of the Disclosure Schedule.

 

		3.24	Products; Product Liability. There are not presently pending, or, to the Company’s
Knowledge, threatened Proceedings relating to any alleged hazard or alleged Defect in design, manufacture, materials or workmanship,
including any failure to warn or alleged breach of express or implied warranty or representation, relating to any Product. Except
as may be set forth in the Material Contracts, the Company has not extended to any of its customers any written, non-uniform product
warranties, indemnifications or guarantees. True, correct and complete copies of all material correspondence received or sent by
or on behalf of the Company since January 1, 2014, from or to any Governmental Authority with respect to a contemplated or ongoing
actual recall, withdrawal, or suspension from the market of any Product have previously been made available to the Buyer. There
are no Defects in the designs, specifications, or processes as currently in effect with respect to any Product sold or otherwise
distributed by the Company that would reasonably be expected to result in a liability to the Company. The Company is not currently
investigating or considering a recall, withdrawal or suspension from the market of any Product.

 

		3.25	Propriety of Past Payments. In the past five
(5) years, none of the Sellers nor any manager, officer, employee or, to the Company’s Knowledge, agent of the Company or
any other Person associated with or acting for or on behalf of the Company has, directly or indirectly, on behalf of the Company,
made any illegal contribution, gift, bribe, rebate, payoff, influence payment, kickback or other payment to any Person, private
or public, regardless of form, whether in money, property or services, (i) to obtain favorable treatment for the Company or any
Affiliate of the Company in securing business, (ii) to obtain favorable treatment for business secured for the Company, or any
Affiliate of the Company, (iii) to obtain or retain special concessions for or in respect of the Company or any Affiliate of the
Company or (iv) otherwise for the benefit of the Company, or any Affiliate of the Company in violation of any Law, (including existing
site plan approvals, zoning or subdivision regulations or urban redevelopment plans relating to Real Property) to which the Company
is subject. During the past five (5) years, no notice has been received alleging that the Company or any owner, officer, manager,
employee, agent or other Person (in connection with actions on behalf or for the benefit of the Company), has made, given or offered,
directly or indirectly, any unlawful financial or other advantage, contribution, gift, bribe, payoff, kickback or unlawful payment
to any employee or official of any Governmental Authority in any jurisdiction, or taken any other action, in violation of the United
States Foreign Corrupt Practices Act of 1977, the U.K. Bribery Act 2010, the OECD Convention on Combating Bribery of Foreign Public
Officials in Business Transactions of 1997 (the “OECD Convention”) and any law implementing the OECD Convention,
or any other applicable anti-bribery or anti-corruption law. None of the Company’s owners, officers, managers, employees
or, to the Company’s Knowledge, agents are agents, employees, officers or representatives of, or otherwise affiliated with,
any Government Authority or agency or other instrumentality of any Government Authority. The Company’s books and records
accurately reflect the nature of all expenditures related to anything of value provided to a Government Authority.

 

    	 	- 28 -	 

     

    

 

		3.26	Personal Information Laws. The Company is in
material compliance with the requirements of all applicable Laws, and the Company’s written policies and practices relating
to the collection, access, use, disclosure, storage and disposal of Personal Information, including the Health Insurance Portability
and Accountability Act. The Company has taken commercially reasonable steps to ensure that personal information is protected against
unauthorized use, transfer, modification, disclosure or other misuse, including implementation of technical, physical, and operational
security measures and an ongoing process to monitor compliance. No complaint relating to the Company’s alleged non-compliance
with any such applicable Law has been found by any Governmental Authority to be well-founded, no order or judgment has been made
against the Company by any Governmental Authority based on any finding of non-compliance with any such applicable Law, no unresolved
complaint, investigation or other proceeding relating to any such alleged non-compliance is now pending by or before any Governmental
Authority and the Company has otherwise never received any complaints related to data protection or the handling of Personal Information.

 

		3.27	International Trade Laws and Regulations. Within
the past five (5) years: (a) the Sellers and the Company, in each case in respect of the Business, are in material compliance with
all applicable embargoes and sanctions imposed by any foreign Governmental Authority against a country, political organization
or other Person (other than those, the compliance with which would constitute a violation of the Laws of the United States); (b)
neither the Company, nor, in respect of the Business, the Sellers holds any unlawful contracts with a party in or from Cuba, Iran,
North Korea, Sudan or Syria nor do they otherwise provide any services, products or technology directly or indirectly to Persons
in these countries; (c) all activities of the Company and, in respect of the Business, the Seller including all exports, re-exports,
sales or transfers of products, technology, software or services, have been effected in material compliance with all applicable
export control and trade control (arms trafficking and brokering) rules; (d) the Company and, in respect of the Business, the Sellers
are in material compliance with all other aspects of applicable International Trade Laws and Regulations; and (e) neither the Company,
nor, in respect of the Business, the Sellers has conducted or initiated any internal investigation or made a voluntary disclosure
to any government or Government Authority with respect to any alleged act or omission arising under the aforementioned laws. To
the Company’s Knowledge, no government or Government Authority has initiated or given written notice threatening to initiate
any investigation, audit, review or prosecution of the Company, or, in each case in respect of the Business, the Sellers with respect
to non-compliance with such laws.

 

		3.28	Internal Accounting Controls. The Company maintains
a system of internal accounting controls sufficient to provide reasonable assurance in accordance with customary business practices
for non-public companies 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, (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.

 

    	 	- 29 -	 

     

    

 

		3.29	Conflict Minerals. The Company has not manufactured,
contracted to have manufactured for, or sold any product that contains a “conflict mineral” (as such term is defined
in Section 1502 of the Dodd-Frank Wall Street Reform and Consumer Protection Act).

 

Article
4

REPRESENTATIONS
AND WARRANTIES OF BUYER

 

Buyer hereby represents
and warrants to the Company and Sellers as set forth below as of the date hereof and as of the Closing Date.

 

		4.1	Organization and Good Standing. Buyer is a corporation duly organized, validly existing
and in good standing under the Laws of the State of Delaware, and has full corporate power and authority to carry on its business
as presently conducted, and to own and lease the assets and properties which it owns and leases.

 

		4.2	Power and Authorization; Enforceability.

 

		4.2.1	Buyer has all requisite right, power, authority and capacity to execute and deliver this Agreement
and the other Buyer Transaction Documents, to perform its obligations hereunder and thereunder and to consummate the Transactions.
All necessary corporate action has been taken by Buyer to authorize the execution, delivery and performance by Buyer of this Agreement
and each other Buyer Transaction Document. Buyer has duly executed and delivered this Agreement and, at or prior to the Closing,
will have duly executed and delivered each other Buyer Transaction Document.

 

		4.2.2	Assuming that this Agreement and each of the other Buyer Transaction Documents are valid and binding
obligations of each of the other parties hereto and thereto, this Agreement is, and each other Buyer Transaction Document, when
duly executed and delivered at or prior to the Closing by Buyer, will be, the legal, valid and binding obligation of Buyer, enforceable
against Buyer in accordance with its respective terms, except as enforceability of such obligations may be limited by the Remedies
Exception.

 

		4.3	No Violation or Conflict.

 

		4.3.1	Neither the execution, delivery and performance by Buyer of this Agreement or of the other Buyer
Transaction Documents nor the consummation of the Transactions (with or without the passage of time or the giving of notice, or
both) will:

 

		(a)	conflict with, or result in a breach of, the Governing Documents of Buyer;

 

		(b)	violate or conflict with any Judgments or Laws, in each case, binding upon or applicable to Buyer
or by which it or any of its properties or assets are bound or require the consent, approval or action of, filing with or notice
to any Governmental Authority or other Person; or

 

    	 	- 30 -	 

     

    

 

		(c)	violate, or be in conflict with, or constitute a default (or an event which, with notice or lapse
of time or both, would constitute a default) under, or result in, or provide the basis for, the termination of, or accelerate the
performance required by, or excuse performance by any Person of any of its obligations under, or cause the acceleration of the
maturity of any Indebtedness or obligation pursuant to, or result in the creation or imposition of any Lien upon any property or
assets of Buyer under, any material Contract to which Buyer is a party or by which it or any of its properties or assets are bound;

 

except, in
each case of clauses (a) through (c), where the failure of any of the above to be true would not reasonably be expected to impair,
prevent or delay the consummation of the transactions contemplated by this Agreement.

 

		4.4	Compliance with Laws. Buyer is in material compliance with all applicable Laws and
Governmental Authorizations, except where the failure to comply would not reasonably be expected to impair, prevent or delay the
consummation of the transactions contemplated by this Agreement.

 

		4.5	Litigation. There are no unsatisfied Judgments against Buyer or any of its business
properties or assets that would reasonably be expected to affect the ability of Buyer to perform its obligations under this Agreement.
There is no Proceeding pending or, to the knowledge of Buyer, threatened in writing against Buyer which seeks to delay or prevent
the consummation of the transactions contemplated by this Agreement by Buyer or would, if successful, be reasonably expected to
adversely affect the ability of Buyer to perform its obligations under this Agreement.

 

		4.6	Brokers. Except for Kanders & Company, Inc., no broker, investment banker, financial
advisor, finder, agent or other intermediary has acted on Buyer’s behalf in connection with this Agreement or any of the
transactions contemplated hereby, and except for fees payable to Kanders & Company, Inc., there are no brokerage commissions,
finders’ fees or similar fees or commissions payable in connection therewith based on any Contract with Buyer or any action
taken by Buyer.

 

		4.7	Investment. Buyer is acquiring the Transferred Interests for its own account, for
investment only, and not with a view to any resale or public distribution thereof. Buyer has sufficient knowledge and experience
in financial and business matters so as to be capable of evaluating the merits and risks of its investment in the Transferred Interests
and is capable of bearing the economic and other risks of such investment. Buyer acknowledges that (a) such Transferred Interests
have not been registered under the Securities Act of 1933, as amended, or any state securities laws, (b) there is no public market
for such Transferred Interests and there can be no assurance that a public market will develop, and (c) it must bear the economic
risk of its investment in such Transferred Interests for an indefinite period of time. As of the Closing, Buyer will be an “Accredited
Investor” within the meaning of the Securities and Exchange Commission Rule 501 of Regulation D of the Securities Act of
1933, as presently in effect. Buyer is not acting as agent or representative of another party, and has no current plan or intention
to resell any of the Transferred Interests or the assets or business of the Company to another Person.

 

		4.8	Available Funds. The obligations of Buyer under this Agreement are not contingent
on the availability of financing. Buyer has cash, available credit facilities or other sources of available funds in an aggregate
amount sufficient to consummate the Transactions and will have immediately available cash, available credit facilities or other
immediately available funds at the time of the Closing to consummate the Transactions.

 

    	 	- 31 -	 

     

    

 

		4.9	Solvency. Immediately after giving effect to the Transactions, Buyer will be Solvent
(as defined below). No transfer of property is being made, and no obligation is being incurred, in connection with the Transactions
with the intent to hinder, delay or defraud either present or future creditors of Buyer. For purposes of this Section 4.9,
“Solvent” means that, as of any date of determination, (a) the Present Fair Salable Value (as defined below)
of the assets of Buyer will, as of such date, exceed all of its probable liabilities or its existing debts as they become absolute
and matured, as of such date, (b) Buyer will not have, or have access to, as of such date, an unreasonably small amount of capital
for the business in which it is engaged or will be engaged and (c) Buyer will be able to pay its liabilities as they become absolute
and mature, in the Ordinary Course, taking into account the timing of and amounts of Cash to be received by it and the timing of
and amounts of Cash to be payable on or in respect of its Indebtedness, in each case after giving effect to the Transactions. The
term “Solvency” will have a correlative meaning. “Present Fair Salable Value” means the amount
that may be realized if the aggregate assets (including goodwill) of Buyer are sold as an entirety with reasonable promptness in
an arm’s-length transaction under then-present conditions for the sale of comparable business enterprises.

 

		4.10	Tax and Legal Matters. Buyer has reviewed with Buyer’s own tax advisors and
legal counsel the tax and other consequences of the Transactions and the legal effects thereof before Buyer’s execution and
delivery of this Agreement and each other Buyer Transaction Document. Buyer has relied solely on its own advisors and not on any
statements or representations by Sellers, the Sellers’ Representative, the Company, or any of their respective Representatives,
except for the representations and warranties of Sellers in Article 2 and Article 3. Buyer understands
that it (and not Sellers, or the Seller’s Representative) will be responsible for its own legal or Tax Liabilities that may
arise as a result of the Transactions. Buyer agrees that it has been advised to consult with its own tax and legal counsel in connection
with the foregoing.

 

Article
5

CERTAIN
COVENANTS OF THE PARTIES

 

		5.1	Further Actions. From and after the Closing, each Seller and Buyer agrees to, from
time to time, execute and deliver such other documents, certificates, agreements, and other writings as any other Party reasonably
requests, and to take such other actions, as may be reasonably necessary, proper, or advisable in order to consummate or implement
expeditiously the Transactions. Notwithstanding the foregoing in this Section 5.1, none of Sellers, Buyer or
any of their respective Affiliates will be obligated to make any payments, or otherwise pay any consideration, to any third party
to obtain any applicable consent, waiver or approval.

 

		5.2	Access to Information.

 

		5.2.1	From and after the Closing, Sellers and Buyer will promptly afford the other Party and its Affiliates
and their respective Representatives reasonable access to their respective properties, information, data, books, records, employees
and auditors to the extent relating to the Company to the extent necessary or useful for the Party requesting such access in connection
with any Proceeding (other than any Proceeding in connection with this Agreement, the other Transaction Documents or the Transactions).
In addition, from and after the Closing Date, Buyer will, and will cause its Affiliates to, upon reasonable notice by Sellers or
their respective Affiliates to Buyer, (a) provide to Sellers and their respective Affiliates and their respective Representatives
reasonable access during reasonable working hours to their properties, information, data, books, records, employees and auditors
to the extent relating to the Company with respect to any Pre-Closing Period or matter occurring prior to the Closing, (b) permit
Sellers and their respective Affiliates and their respective Representatives to make such copies and inspections of any such information,
data, books and records as any of them may reasonably request during reasonable hours to the extent reasonably required by the
Sellers, (c) make reasonably available to Sellers and their respective Affiliates and their respective Representatives, the officers,
employees and other Representatives of the Company and to provide reasonable assistance and cooperation in the review of information
described in this Section 5.2.1 and (d) cooperate with Sellers and their respective Affiliates and their respective
Representatives to the extent reasonably necessary or appropriate in connection with any Proceeding arising out of the Business,
in each case other than with respect to any Proceeding involving disputes (y) between Buyer, on the one hand, and Sellers, on the
other hand or (z) for which Buyer seeks indemnification hereunder.

 

    	 	- 32 -	 

     

    

 

		5.2.2	Anything to the contrary in Section 5.2.1 notwithstanding, (a) access rights pursuant
to Section 5.2.1 will be exercised in such manner as not to interfere unreasonably with the conduct of the Business
or any other business of the Party granting such access, (b) the Party granting access may withhold any document (or portions thereof)
or information (i) that is subject to the terms of a non-disclosure agreement with a third party, (ii) that may constitute privileged
attorney-client communications or attorney work product and the transfer of which, or the provision of access to which, as reasonably
determined in writing by such Party’s counsel, constitutes a waiver of any such privilege or (iii) if the provision of access
to such document (or portion thereof) or information, as reasonably determined in writing by such Party’s counsel, would
reasonably be expected to conflict with applicable Laws or agreements with Governmental Authorities, (c) no Seller or any of its
respective Affiliates or their respective Representatives will have any obligation to provide Buyer, its Affiliates or their respective
Representatives access to any personnel records of Sellers or the Company relating to individual performance or evaluation records,
medical histories, or other information in personnel records to the extent that providing such access would constitute a breach
of Law by any of Sellers or the Company, and (d) the Party requesting access pursuant to Section 5.2.1 will reimburse
the other Party promptly for all reasonable and documented out-of-pocket costs and expenses incurred by the other Party in connection
with any such request made after the Closing.

 

		5.3	Confidentiality; Books and Records.

 

		5.3.1	The Confidentiality Agreement will automatically terminate as of the Closing.

 

		5.3.2	From and after the Closing, (a) Sellers and Buyer will, and will cause their respective Affiliates
and Representatives to, maintain in confidence this Agreement and the other Transaction Documents and any written, oral or other
information related to the negotiation hereof and thereof, (b) Sellers will, and will cause their respective Affiliates and Representatives
to, maintain in confidence any written, oral or other information relating to the Company obtained by virtue of Sellers’
ownership of the Company prior to the Closing and (c) Buyer will, and will cause its Affiliates and Representatives to, maintain
in confidence any written, oral or other information of or relating to Sellers or their respective Affiliates obtained by virtue
of Buyer’s or Sellers’ ownership, management or provision of services to the Company from and after the Closing, except,
in each case, to the extent that the applicable Party is required to disclose such information by judicial or administrative process
or pursuant to applicable Law or such information can be shown to have been in the public domain through no fault of the applicable
Party.

 

    	 	- 33 -	 

     

    

 

		5.3.3	Subject to Sections 5.3.1 and 5.3.2, Sellers, their respective Affiliates
and their respective Representatives will have the right to retain copies of all books, data, files, information and records in
any media (including, for the avoidance of doubt, Tax returns and other information and documents relating to Tax matters) of the
Company relating to periods ending on or prior to the Closing Date or any Straddle Period (a) relating to information (including
employment and medical records) regarding the Continuing Employees, (b) as may be required by any Governmental Authority, including
pursuant to any applicable Law or regulatory request or (c) as may be necessary for Sellers or their respective Affiliates to perform
their respective obligations pursuant to this Agreement or any other Transaction Document, in each case subject to compliance with
all applicable privacy Laws. Buyer agrees that, with respect to all original books, data, files, information and records of the
Company existing as of the Closing Date, it will (x) comply in all material respects with all applicable Laws relating to the preservation
and retention of records, (y) apply preservation and retention policies that are no less stringent in the aggregate than those
generally applied by Buyer to its own books and records and (z) until the later of seven (7) years after the Closing Date or the
date on which Taxes may no longer be assessed under the applicable statutes of limitation, including any waivers or extensions
thereof, preserve and retain all such original books, data, files, information and records.

 

		5.4	Restrictive Covenants. The Parties agree that Buyer is relying on the covenants and
agreements set forth in this Section 5.4, that without such covenants Buyer would not enter into this Agreement or
consummate the Transactions and that the purchase price is sufficient consideration to make the covenants and agreements set forth
herein enforceable.

 

		5.4.1	Non-Competition by Sellers. During the Restriction Period, Sellers will not, directly
or indirectly, and shall cause their respective Affiliates not to, directly or indirectly, as an employee, employer, consultant,
agent, principal, partner, stockholder, officer, director, investor, lender, financier or broker, or in any other individual or
representative capacity, engage or participate or plan or prepare to engage or participate in the Business or assist any Person
in engaging or participating or planning or preparing to engage or participate in the Business, in each case in the United States
of America, Europe, Mexico, Canada or any other geographic area where the Company is engaging in the Business immediately prior
to the Closing or in which the Products are marketed immediately prior to the Closing or through the investment of capital, lending
of money or property, rendering of services or capital, or otherwise, in any enterprise engaging in a business competitive with
the Business or otherwise compete with the Company (the “Prohibited Activities”); provided, however,
that nothing in this Section 5.4.1 will prohibit any Seller from:

 

		(a)	performing duties as an employee or consultant of the Buyer;
or

 

    	 	- 34 -	 

     

    

 

		(b)	owning two percent (2%) or less of the stock of any Person
listed on a national securities exchange or traded in the over-the-counter market.

 

		5.4.2	Non-Solicitation by Sellers. During the Restriction Period, no Seller nor any of
its respective Affiliates will, directly or indirectly, hire, recruit or solicit any officers, directors, senior executives or
other employees of the Company to become employed or engaged by any other Person or to terminate any such Person’s employment
or consulting relationship with Buyer or, after the Closing, the Company; provided, however, that the foregoing will
not prohibit any general advertisements or solicitations of employment by Sellers or their respective Affiliates not specifically
directed to officers, managers, employees or contractors of the Company, Buyer or their respective Affiliates and the hiring of
any Person as a result of such general advertisement or solicitation not specifically directed to officers, managers, employees
or contractors of the Company, Buyer or their respective Affiliates.

 

		5.4.3	Blue-Pencil. If any court of competent jurisdiction will, at any time, deem the term
of any particular restrictive covenant contained in this Section 5.4 too lengthy or the scope too broad, the other
provisions of this Section 5.4 will nevertheless stand, and the covenant, as determined by a court of competent jurisdiction,
will be deemed reformed such that the term will be deemed to be the longest period permissible by Law under the circumstances and
the scope will be as broad as permissible by Law under the circumstances. The court of competent jurisdiction in each case will
reduce the term and/or scope covered to permissible duration or breadth.

 

		5.4.4	Remedies. Sellers represent that they are familiar with the covenants not to solicit
contained herein and are fully aware of their respective obligations hereunder. Sellers further agree that the length of time and
scope are reasonable given the benefits they have received hereunder. Sellers further acknowledge and agree that the covenants
set forth in this Section 5.4 are necessary for the protection of Buyer’s business interests, including the
goodwill and confidential information being transferred by reason of the Transactions, that irreparable injury will result to Buyer
if Sellers breach any of the terms of this Section 5.4, and that in the event of an actual or threatened breach by
Sellers of any of the provisions contained in this Section 5.4, Buyer will have no adequate remedy at Law. Sellers
accordingly agree that in the event of any actual or threatened breach by any Seller of any of the provisions contained in this
Section 5.4, Buyer will be entitled to seek injunctive and other equitable relief without the necessity for showing
irreparable harm as a remedy for any such breach or threatened breach, and Sellers further agree to waive any requirement for the
posting of any bond or other security in connection with such remedy. Such remedy shall not be deemed to be the exclusive remedy
for breach of the provisions contained in this Section 5.5 but shall be in addition to all other remedies available
at law or in equity to Buyer. Nothing contained herein will be construed as prohibiting Buyer from pursuing any other remedies
available to it for such breach or threatened breach, including the recovery of any damages that it is able to prove. Sellers will
be liable for any breach by their respective Affiliates of this Section 5.4.

 

    	 	- 35 -	 

     

    

 

		5.5	Tax Matters.

 

		5.5.1	Tax Returns.

 

		(a)	The Company, under the direction of the Sellers’ Representative, will be responsible for
preparing any Company Returns for any Pre-Closing Tax Period (other than a Straddle Period) that is required to be filed after
the Closing Date and will prepare such Company Returns in accordance with past practices of the Company.

 

		(b)	Buyer will be responsible for preparing any Company Returns for any Straddle Period and will prepare
such Company Returns in accordance with past practices of the Company. No later than thirty (30) days prior to the due date for
filing such Company Returns for any Straddle Period, taking into account any extensions of such filing date, Buyer will make such
Company Returns available for review and approval by the Sellers’ Representative. The Sellers’ Representative shall
have the right to object to such Return within ten (10) days of receipt of such Return. If the Sellers’ Representative objects
to a Return, the Sellers’ Representative and the Buyer agree to use their best efforts to resolve the dispute. Any dispute
not resolved within twenty (20) days after an objection shall be submitted to the Independent Accounting Firm. The Independent
Accounting Firm’s review shall be limited to the disputed item and the parties shall direct the Independent Accounting Firm
to conclude its review within ten (10) days of submission of the objection to the Independent Accounting Firm. The fees and expenses
of the Independent Accounting Firm shall be borne equally by the Buyer, on the one hand, and the Sellers, on the other hand.

 

		(c)	After the Closing Date, without the prior written consent of the Sellers’ Representative,
none of the Company or Buyer will amend any Company Return relating to a Pre-Closing Tax Period.

 

		5.5.2	Tax Contests. Buyer, on behalf of the Company, will promptly notify the Sellers’
Representative in writing upon receipt by Buyer or the Company of notice of any Tax audits, examinations or assessments with respect
to Taxes of the Company that pertain to a Pre-Closing Tax Period or Straddle Period or that could give rise to indemnification
under Article 6. The Sellers’ Representative will control the portion of any such audit, examination or proceeding
that relates to any Pre-Closing Tax Period and Buyer and the Sellers’ Representative will jointly control with respect to
any Straddle Period; provided, however, that with respect to any audit, examination or proceeding that relates to
either a Pre-Closing Tax Period or Straddle Period, each of Buyer and the Sellers’ Representative will be entitled to participate
in the defense of such claim to the extent it could adversely affect that party and to employ counsel of its choice for such purpose,
the fees and expenses of which separate counsel will be borne solely by that party.

 

		5.5.3	Tax Refunds. Any refund of Taxes received by the Company relating to a Pre-Closing
Tax Period (or any election to apply the right to such a refund as a payment of, or a credit against, future Taxes) (a “Pre-Closing
Tax Refund”), will be credited to Sellers. Buyer will promptly pay, or cause to be paid, the amount of any such Pre-Closing
Tax Refund, including the amount of interest actually received thereon, to Sellers upon receipt (or use) of such Pre-Closing Tax
Refund by the Company or any of its Affiliates (it being understood that in the case of an election to use any such refund as a
payment of, or a credit against, future Taxes, such refund will be considered to be used at the time such election is made).

 

    	 	- 36 -	 

     

    

 

		5.5.4	Books and Records; Cooperation. Buyer and Sellers will, and will cause their respective
Representatives to, (a) provide the other Party and its Representatives with such assistance as may be reasonably requested in
connection with the preparation of any Tax Return or any audit or other examination by any Taxing Authority or Proceeding relating
to Taxes with respect to the Company and (b) retain (until the expiration of the statute of limitations of the taxable periods
to which the Tax Returns relate), and provide the other Party and its Representatives with reasonable access to, all records or
information that may be relevant to such Tax Return (including analysis regarding any Tax refunds or Tax benefits), audit, examination
or proceeding, provided, that the foregoing will be done at the expense of the Party making such request and in a manner
so as not to interfere unreasonably with the conduct of the business of the Parties.

 

		5.5.5	Straddle Period. For purposes of this Agreement, the portion of Tax with respect
to the income, property or operations of the Company that is attributable to any Tax period that begins on or before the Closing
Date and ends after the Closing Date (a “Straddle Period”) will be apportioned between the portion of the Straddle
Period that extends before the Closing Date through the Closing Date (the “Pre-Closing Straddle Period”) and
the portion of the Straddle Period that extends from the day after the Closing Date to the end of the Straddle Period (the “Post-Closing
Straddle Period”). The portion of such Tax attributable to the Pre-Closing Straddle Period will (a) in the case of any
Taxes other than sales or use taxes, value-added taxes, employment taxes, withholding taxes, and any Tax based on or measured by
income, receipts or profits earned during a Straddle Period, be deemed to be the amount of such Tax for the entire taxable period
multiplied by a fraction, the numerator of which is the number of days in the Pre-Closing Straddle Period and denominator of which
is the number of days in the Straddle Period and (b) in the case of any sales or use taxes, value-added taxes, employment taxes,
withholding taxes, and any Tax based on or measured by income, receipts or profits earned during a Straddle Period, be deemed equal
to the amount that would be payable if the Straddle Period ended on and included the Closing Date. The portion of Tax attributable
to a Post-Closing Straddle Period will be calculated in a corresponding manner.

 

		5.5.6	Transfer Taxes. All transfer, documentary, sales, use, stamp, registration, value
added and other such Taxes and fees (including any penalties and interest) imposed in connection with the Transactions (“Transfer
Taxes”) will be borne and paid equally by the Buyer, on the one hand, and the Sellers, on the other hand, including,
without limitation, any Transfer Taxes attributable to the deemed sale or transfer of the Owned Real Property or Leased Real Property,
if any.

 

		5.5.7	Tax Treatment. The Parties acknowledge that for United States federal and state income
Tax purposes, the Transactions will be treated under Revenue Ruling 99-6 as if (i) each Seller had sold all of its respective Transferred
Interests to Buyer, (ii) the Buyer had purchased all of the assets of the Company, and (iii) the Company’s classification
as a partnership terminated as of the Closing Date.

 

    	 	- 37 -	 

     

    

 

		5.5.8	Purchase Price Allocation. To the extent relevant to the preparation of Tax Returns
of Buyer, the Company, Sellers, and/or the shareholders of Sellers, including without limitation for purposes of (i) adjusting
the Tax basis of the Company’s assets after the Closing Date, and (ii) computing the amount of gain, if any, described in
Section 751 of the Code with respect to Sellers’ sale of the Transferred Interests, the purchase price and any Company liabilities
and other amounts deemed to be paid for the Company’s assets shall be allocated among the assets of the Company based upon
their relative fair market values. Such fair market values shall be determined using the agreed upon values and valuation methodology
set forth on Section 5.5.8 of the Disclosure Schedule, which values may be adjusted as reasonably determined by Sellers
with the consent of Buyer, such consent not to be unreasonably withheld, conditioned or delayed, to reflect a review of the assets
of the Company completed prior to the date hereof, and such adjusted values will be provided to Buyer no later than sixty (60)
days after the Closing Date (as adjusted, the “Allocation Schedule”). Any post-Closing adjustments to the purchase
price pursuant to this Agreement shall be allocated in a manner consistent with the Allocation Schedule. Buyer, the Company and
Sellers shall file all Tax Returns (including amended returns and claims for refund) and information reports in a manner consistent
with the Allocation Schedule and will not take any position inconsistent therewith in connection with any examination of any such
Tax Returns or in any administrative or judicial proceedings relating to such Tax Returns, unless required by a determination of
the applicable Taxing Authority that is final.

 

		5.6	Employee Matters.

 

		5.6.1	Employment Terms and Benefits. With respect to the employees of the Company who are
employed by the Company as of the Closing Date (the “Continuing Employees”), for a period extending until the
earlier of the termination of a Continuing Employee’s employment by the Buyer or its Affiliates or one (1) year following
the Closing Date (or, with respect to continuation of bonus or commission opportunity, until the end of calendar 2017), Buyer agrees
that each Continuing Employee will be provided with compensation and benefits that are substantially comparable in the aggregate
to the compensation and benefits provided to each such Continuing Employee immediately prior to the Closing Date. Nothing in this
Agreement shall change the “at-will” status of any at-will Employee or otherwise require Buyer or the Company to continue
to employ any particular Employee of the Company following the Closing Date.

 

    	 	- 38 -	 

     

    

 

		5.6.2	Service Credit. Buyer will ensure that, as of the Closing Date, each Continuing Employee
receives full credit (for all purposes, including eligibility to participate, vesting, vacation entitlement and severance benefits,
but excluding benefit accrual under any defined-benefit pension plan), for service with Sellers, the Company or any Affiliates
(or predecessor employers to the extent such past service credit is provided under the applicable Employee Benefit Plans) under
each of the comparable employee benefit plans of the Company, Buyer or its Affiliates in which such Continuing Employee becomes
a participant; provided, however, that no such service recognition will result in any duplication of benefits. As
of the Closing Date, Buyer or its Affiliates will assume the amount of vacation time that each Continuing Employee had accrued
under any applicable employee benefit plan as of the Closing Date. With respect to each health or welfare benefit plan maintained
by Buyer or its Affiliates for the benefit of any Continuing Employee, subject to any required approval of the applicable insurance
provider, if any, which Buyer will use commercially reasonable efforts to procure, Buyer will (a) cause to be waived any eligibility
waiting periods, any evidence of insurability requirements and the application of any pre-existing condition limitations under
such plan and (b) cause each Continuing Employee to be given credit under such plan for all amounts paid by such Continuing Employee
under any similar employee benefit plan for the plan year that includes the Closing Date for purposes of applying deductibles,
co-payments and out-of-pocket maximums as though such amounts had been paid in accordance with the terms and conditions of the
applicable plan maintained by the Company, Buyer or its Affiliates for the plan year in which the Closing Date occurs.

 

		5.6.3	COBRA. Buyer or its Affiliates will bear and be responsible for all liabilities and
obligations to provide any former employees of the Company or any Continuing Employees who terminate employment after the Closing
Date with COBRA continuation coverage in accordance with the requirements of Section 4980B of the Code and any applicable state
Law.

 

		5.6.4	BHH Plans. Effective as of the Closing Date, except with respect to the BHH Management,
Inc. 401(k) Profit Sharing Plan as contemplated below, the Company will cease to be a participating employer in any Employee Benefit
Plans sponsored by BHH, and the Continuing Employees will have no further rights to participate in such BHH Employee Benefit Plans
as active employees after the Closing Date. Effective as of the Closing Date, Buyer and its Affiliates shall have no liability
under any such Employee Benefit Plans sponsored by BHH, are not adopting, assuming or maintaining any Employee Benefit Plan sponsored
by BHH and shall, subject to Article 6, be indemnified and held harmless by Sellers against and in respect of any
and all Losses arising out of the Employee Benefit Plans sponsored by BHH. The Parties hereby agree that the BHH Management, Inc.
401(k) Profit Sharing Plan will be adopted and assumed by the Company effective as of the Closing Date, and will not be considered
an Employee Benefit Plan sponsored by BHH for purposes of this Section 5.6.4.

 

		5.6.5	Miscellaneous. Nothing contained in this Agreement, whether express or implied, will
(a) be treated as an amendment of any Employee Benefit Plan or other benefit plan maintained by Sellers, Buyer or any of their
respective Affiliates, or will be construed to prohibit Sellers, Buyer or any of their respective Affiliates from amending or terminating
any such Employee Benefit Plan or other benefit plan, (b) limit the right of Sellers, Buyer or any of their respective Affiliates
to terminate the employment of any Person, (c) provide any Person with any right to continued employment or (d) create any third
party beneficiary rights in any Person who is not a party to this Agreement.

 

    	 	- 39 -	 

     

    

 

		5.7	Directors’ and Officers’ Exculpation; Indemnification.

 

		5.7.1	Buyer will cause the Company to assume, and the Company hereby assumes the obligations with respect
to all rights to indemnification and exculpation from liabilities for acts or omissions occurring at or prior to the Closing Date
in favor of the members of the Company as of immediately prior to the Closing (the “Members”) and the current
or former directors, managers, officers or other employees or agents of the Company or the Members currently indemnified by the
Company (collectively, the “Covered Persons”) as provided in the Governing Documents of the Company as in effect
immediately prior to the Closing, and such obligations will survive the consummation of the Transactions and will continue in full
force and effect in accordance with their terms for not less than six (6) years from the Closing Date.

 

		5.7.2	This Section 5.7 is (a) intended to be for the benefit of, and will be enforceable
by, each Covered Person and such Covered Person’s heirs, legatees, representatives, successors and assigns, it being expressly
agreed that such Covered Persons will be third party beneficiaries of this Section 5.7, and (b) in
addition to, and not in substitution for, any other rights to indemnification or contribution that any such Covered Person may
have by contract or otherwise as set forth on Section 5.7.2 of the Disclosure Schedule.

 

		5.7.3	If all or substantially all of the business or assets of the Company are sold, whether by merger,
consolidation, sale of assets or securities or otherwise, in one transaction or a series of transactions, then Buyer and the Company
will, and in each such case, cause their respective successors and assigns to assume the obligations set forth in this Section
5.7. This Section 5.7 will apply to all such successors and assigns.

 

		5.8	Representation & Warranty Insurance Policy. Buyer (or one or more of its Affiliates)
has entered into the Representation and Warranty Insurance Policy. Buyer will not (and will cause its Affiliates to not) amend,
modify, terminate or waive any provision concerning the rights of subrogation contained in the Representation and Warranty Insurance
Policy or any other provision thereof in a manner materially adverse to Sellers without the prior written consent of the Sellers’
Representative.

 

Article
6

INDEMNIFICATION 

 

		6.1	Indemnification by Sellers. Subject to the terms of this Article 6,
each Seller will, severally and not jointly with any other Person, based on each such Seller’s Pro Rata Portion (provided
that each Seller will be liable for the full amount of any indemnification obligations arising from a breach of any covenant or
obligation of such Seller under this Agreement or any other Transaction Document, and the non-breaching Seller will have no liability
for such amount), indemnify and hold Buyer and its Affiliates (including, after the Closing, the Company) and each of their respective
officers, directors, shareholders, managers, members, employees, agents, Representatives, successors and permitted assigns (each
a “Buyer Indemnified Party” and, collectively, the “Buyer Indemnified Parties”) harmless
against and in respect of any and all Losses, which such Buyer Indemnified Party has suffered, incurred or become subject to arising
out of, based upon or otherwise in respect of:

 

		6.1.1	any breach or non-fulfillment of any covenant or obligation of the Company or such Seller under
this Agreement or of any Transaction Document;

 

    	 	- 40 -	 

     

    

 

		6.1.2	any Closing Indebtedness or Closing Transaction Expenses, to the extent such amounts have not been
paid pursuant to Section 1.3 or included in the calculation of Closing Date Purchase Price;

 

		6.1.3	any claim for payment of fees and/or expenses as a broker or finder in connection with the origin,
negotiation or execution of this Agreement or the other Transaction Documents or the consummation of the Transactions based upon
any agreement, arrangement or understanding between the claimant and any Seller or any of its respective agents or Representatives
or, prior to the Closing, the Company or any of its agents or Representatives;

 

		6.1.4	any Taxes of the Company or the non-payment thereof for any taxable period ending on or prior to
the Closing Date or any portion of the Pre-Closing Tax Period through the end of the Closing Date; and

 

		6.1.5	any claim related to any failure of the BHH Management, Inc. 401(k) Profit Sharing Plan to be administered,
maintained, funded and sponsored in compliance with its terms and applicable Laws, including ERISA and the Code, at any time prior
to the Closing Date.

 

For the avoidance of
doubt, Sellers will not indemnify the Buyer Indemnified Parties for any breach of any representation or warranty made by the Sellers
in Article 2 or Article 3 of this Agreement or of any Transaction Documents. The Representation &
Warranty Insurance Policy will be Buyer’s sole and exclusive remedy for any and all claims for breach of any representation
or warranty made by the Sellers in Article 2 or Article 3 of this Agreement or of any Transaction Documents.

 

		6.2	Indemnification by Buyer. Subject to the terms of this Article 6, Buyer
and, after the Closing, the Company, will jointly and severally indemnify and hold Sellers and their respective Affiliates, and
each of their respective officers, directors, shareholders, managers, members, trustees, employees, agents, Representatives, successors
and permitted assigns (each a “Seller Indemnified Party” and, collectively, the “Seller Indemnified
Parties”) harmless against and in respect of any and all Losses which such Seller Indemnified Party has suffered, incurred
or become subject to arising out of, based upon or otherwise in respect of:

 

		6.2.1	any breach of any representation or warranty made by Buyer in Article 4 of this Agreement;

 

		6.2.2	any breach or non-fulfillment of any covenant or obligation of Buyer or, after the Closing, the
Company, under this Agreement; and

 

		6.2.3	any claim for payment of fees and/or expenses as a broker or finder in connection with the origin,
negotiation or execution of this Agreement or the other Transaction Documents or the consummation of the Transactions based upon
any agreement, arrangement or understanding between the claimant and Buyer or any of its agents or Representatives.

 

    	 	- 41 -	 

     

    

 

		6.3	Claims.

 

		6.3.1	Inter-Party Claims. In order for a Buyer Indemnified Party or a Seller Indemnified
Party (each, an “Indemnified Party”) to be entitled to any indemnification pursuant to this Article 6,
the Indemnified Party will notify the other Party or Parties from whom such indemnification is sought (the “Indemnifying
Party”) in writing promptly after becoming aware of the facts or circumstances giving rise to such Indemnified Party’s
claim for indemnification, specifying in reasonable detail the basis of such claim (an “Inter-Party Claim”);
provided, however, that failure to give such notification will not affect the indemnification provided hereunder
except to the extent the Indemnifying Party will have been actually prejudiced as a result of such failure.

 

		6.3.2	Third Party Claims.

 

		(a)	In order for an Indemnified Party to be entitled to any indemnification provided for under this
Agreement in respect of, arising out of or involving a claim made by any Person (other than by an Indemnified Party, which claims
are addressed in Section 6.3.1) against the Indemnified Party (a “Third Party Claim”), such Indemnified
Party must notify the Indemnifying Party in writing of the Third Party Claim (which notice will specify in reasonable detail the
events giving rise to such Third Party Claim) promptly after receipt by such Indemnified Party of notice of the Third Party Claim;
provided, however, that failure to give such notification will not affect the indemnification provided hereunder
except to the extent the Indemnifying Party will have been actually prejudiced as a result of such failure. Thereafter, the Indemnified
Party will deliver to the Indemnifying Party, promptly following the Indemnified Party’s receipt thereof, copies of all notices
and documents (including court papers) received by the Indemnified Party relating to the Third Party Claim. If a Third Party Claim
is made, the Indemnifying Party will be entitled to participate in the defense thereof. The Indemnifying Party may also assume
the defense of any Third Party Claim with counsel selected by the Indemnifying Party, at such party’s sole expense (without
prejudice to the right of the Indemnified Party to participate at its own expense through counsel of its own choosing); provided
that if the Indemnifying Party desires to assume control of the defense, settlement, adjustment or compromise of any Third Party
Claim, with counsel reasonably acceptable to the Indemnified Party, the Indemnifying Party must give written notice to the Indemnified
Party of its intention to do so no later than twenty (20) days following receipt of notice of claims by an Indemnified Party or
such shorter time period as required so that the interests of the Indemnified Party would not be materially prejudiced as a result
of the failure to have received such notice; provided, however, that the Indemnifying Party may only assume control
of such defense if it acknowledges in writing to the Indemnified Party that any Losses that are assessed against the Indemnified
Party in connection with such Third Party Claim constitute Losses for which the Indemnified Party shall be fully indemnified pursuant
to, but subject to the limitations of, this Article 6. If the Indemnified Party reasonably concludes that separate
counsel is required because either (i) a conflict of interest would otherwise exist or (ii) the Third Party Claim and any claims
that may be related thereto could reasonably be likely to exceed the amount of indemnification available to the Indemnified Party
(either pursuant to the terms of this Article 6 or as a result of the Indemnifying Party(ies) available financial
resources), the Indemnified Party shall have the right to select separate counsel to participate in the defense of such action
on its behalf, at the expense of the Indemnifying Party, and in such case the Indemnifying Party and Indemnified Party shall use
all reasonable efforts to cooperate in such defense. Notwithstanding anything else to the contrary contained herein, the Indemnifying
Party may not control the defense of a Third Party Claim (A) involving criminal liability, (B) in which any relief other
than monetary damages is sought against the Indemnified Party, (C) in which an adverse judgment, in the reasonable and good
faith judgment of the Indemnified Party is likely to establish a precedential custom or practice adverse to the business interests
or reputation of the Buyer or any of its Affiliates, (D)  the defense of which the insurer under the Representation &
Warranty Insurance Policy elects to assume control, (E) that is covered by the Representation & Warranty Insurance Policy,
(F) with respect to which the Indemnified Party reasonably and in good faith determines that the conduct of the defense or any
proposed settlement of any such Third Party Claim by the Indemnifying Party might be expected to adversely affect the ability of
the Indemnified Party to conduct its business (including, relationships with Governmental Authorities, employees, customers, suppliers
or other Persons with whom the Indemnified Party conducts business) or (G) the defense, settlement, adjustment or compromise of
which the Indemnifying Party is not actively and diligently pursuing.

 

    	 	- 42 -	 

     

    

 

		(b)	The party controlling the defense (the “Controlling Party”) shall keep the party
not controlling the defense (the “Non-Controlling Party”) reasonably advised from time-to-time of the status
of the Third Party Claim. The Non-Controlling Party shall furnish the Controlling Party with such information as it may have with
respect to the Third Party Claim and proceedings related thereto (including copies of any summons, complaint or other pleading
which may have been served on such party and any written claim, demand, invoice, billing or other document evidencing or asserting
the same) and shall otherwise cooperate with and assist the Controlling Party in the defense of the Third Party Claim. If the Indemnifying
Party does not choose to assume control of the defense, settlement, adjustment or compromise of any such Third Party Claim for
which any Indemnified Party would be entitled to indemnification hereunder or if the Indemnifying Party is not entitled pursuant
to Section 6.3.2 to defend such Third Party Claim, then (i) the reasonable fees and expenses of one outside counsel
(and not any fees and expenses allocated to any internal counsel) to the Indemnified Party shall be considered “Losses”
for purposes of this Agreement and (ii) the Indemnifying Party shall have the right to elect to join in the defense, settlement,
adjustment or compromise of any such Third Party Claim, and to employ counsel to assist such Indemnifying Party in connection with
the handling of such claim, at the sole expense of the Indemnifying Party, and no such claim shall be settled, adjusted or compromised,
or the defense thereof terminated by the Indemnified Party, without the prior written consent of the Indemnifying Party (which
consent shall not be unreasonably withheld or delayed) unless and until the Indemnifying Party shall have failed, after the lapse
of a reasonable period of time, but in no event more than ten (10) days after written notice to it of the Third Party Claim, to
join in the defense, settlement, adjustment or compromise of the same.

 

		(c)	No Indemnifying Party may settle, compromise or consent to the entry of any judgment in any Third
Party Claim without the prior written consent of each Indemnified Party, which consent shall not be withheld or delayed if such
settlement, compromise or consent (i) is for money damages only, (ii) obligates the Indemnifying Party to assume complete financial
responsibility for such settlement, compromise or consent (and the Indemnifying Party demonstrates to the Indemnified Party that
it has available all required financial resources therefor), (iii) could not otherwise be likely to cause a material adverse effect
on the Indemnified Party and (iv) includes an express, unconditional release of the Indemnified Party and its directors, managers,
officers, agents, shareholders, members, consultants, employees and controlling Persons from all Liabilities and obligations arising
therefrom.

 

    	 	- 43 -	 

     

    

 

		6.4	Survival. The respective representations, warranties, covenants and agreements of
the Parties contained in this Agreement, and the rights of the Parties to seek indemnification with respect to such covenants and
agreements, will survive the Closing; provided, however, that, (a) except in respect of any claims for indemnification
as to which written notice will have been duly given pursuant to Section 6.3 prior to the date that is 36 months
after the Closing Date (the “General Indemnification Period”), and subject to the other provisions of this Article
6, such representations, warranties, covenants and agreements, and the rights of the parties to seek indemnification with
respect to such covenants and agreements, will expire at the end of the General Indemnification Period, except that the Fundamental
Representations will survive for 72 months and (b) this Section 6.4 will not limit any covenant or agreement of the
Parties that, by its terms, requires performance after the General Indemnification Period, which covenant or agreement will survive
the General Indemnification Period in accordance with its terms only for such period as is required for the respective Party to
perform under such covenant or agreement. If proper notice of an indemnification claim is given in accordance with this Article
6 before expiration of the applicable covenant or agreement, then notwithstanding the expiration thereof, any claim based
on such covenant or agreement shall survive until, but only for purposes of, the resolution of such claim. Nothing in this Article
6 shall limit or prohibit the rights of the Buyer to pursue recoveries under the Representation & Warranty Insurance
Policy.

 

		6.5	Certain Limitations on Indemnification.

 

		6.5.1	Notwithstanding anything to the contrary in this Agreement, the amount of Losses (except for Losses
described in Section 6.10) that may be recovered by the Buyer Indemnified Parties pursuant to any and all claims
for indemnification made under Section 6.1 will be limited, individually and in the aggregate, to the Indemnification
Cap. Nothing in this Article 6 will be deemed to limit or prohibit any rights of the Buyer Indemnified Parties as
against any insurer under the Representation & Warranty Insurance Policy.

 

		6.5.2	Sellers will have no obligation to indemnify the Buyer Indemnified Parties against Losses under
this Agreement, unless the aggregate amount of Losses is greater than the Threshold, in which case the Buyer Indemnified Party
will, subject to Section 6.5.1 hereof, be entitled to indemnification for all Losses including those that are less
than the Threshold; provided, however, that the Threshold will not apply to Losses based on a breach of the Fundamental
Representations and/or claims for indemnification made under Sections 6.1.3, 6.1.4 and/or 6.1.5,
for which there will be no minimum threshold before recovery.

 

		6.6	Certain Other Restrictions on Indemnification.

 

		6.6.1	Notwithstanding anything contained in this Agreement to the contrary, no Buyer Indemnified Party
will have any right to indemnification under this Agreement with respect to any Losses to the extent (and only to the extent) such
Losses (i) constitute liabilities in the amounts reserved or accrued for (whether in whole or in part) in the calculation of the
Closing Working Capital (as finally agreed upon or determined pursuant to Section 1.4), (ii) arise solely out of
changes after the Closing Date in applicable Law or interpretations or applications thereof, or (iii) are duplicative of Losses
that have previously been recovered hereunder.

 

    	 	- 44 -	 

     

    

 

		6.6.2	Upon payment in full of any Inter-Party Claim pursuant to Section 6.3.1 or the payment
of any Judgment with respect to a Third Party Claim pursuant to Section 6.3.2, the Indemnifying Party will be subrogated
to the extent of such payment to the rights of the Indemnified Party against any Person with respect to the subject matter of such
Inter-Party Claim or Third Party Claim, unless the Indemnified Party has a continuing commercial relationship with the counterparty
to the Third Party Claim or Inter-Party Claim (other than any insurance company that has issued an insurance policy that is applicable
to such Third Party Claim or Inter-Party Claim). The Indemnified Parties will assign or otherwise reasonably cooperate with the
Indemnifying Parties, at the cost and expense of the Indemnified Parties, to pursue any claims against, or otherwise recover amounts
from, any Person liable or responsible for any Losses for which indemnification has been received pursuant to this Agreement.

 

		6.6.3	No Buyer Indemnified Party will have any right to assert any claim against any Indemnifying Party
with respect to any Loss, cause of action or other claim to the extent such Loss is a Loss, cause of action or claim with respect
to which such Buyer Indemnified Party or any of its Affiliates has taken action (or caused action to be taken) with the primary
intent of accelerating the time period in which such matter is asserted or payable in order to cause a claim to be made prior to
the applicable expiration date set forth in Section 6.4.

 

		6.6.4	To the extent an Indemnified Party or its Affiliates recognizes any net Indemnification Tax Benefits
(as defined below) as a result of any Losses, such Indemnified Party will pay the amount of such Indemnification Tax Benefits to
the Indemnifying Party within sixty (60) days of such Indemnification Tax Benefits being recognized by the Indemnified Party (to
the extent such Indemnification Tax Benefits are recognized prior to the payment of the Losses, the amount of the Losses will be
reduced by the amount of Indemnification Tax Benefits actually recognized). For this purpose, the Indemnified Party will be deemed
to recognize a tax benefit (an “Indemnification Tax Benefit”) with respect to a taxable year if, and to the
extent that, the Indemnified Party’s liability for Taxes for such taxable year, calculated by excluding any Tax items attributed
to the Losses, exceeds the Indemnified Party’s actual liability for Taxes for such taxable year, calculated by taking into
account any Tax items attributed to the Losses.

 

		6.6.5	Notwithstanding any other provision of this Agreement, Sellers will have no obligation to indemnify
the Buyer Indemnified Parties for any Taxes arising in a Post-Closing Tax Period.

 

		6.6.6	Buyer and Sellers agree to treat any indemnification payments received pursuant to this Agreement
for all Tax purposes as an adjustment to the Closing Date Purchase Price to the extent permitted by applicable Law.

 

    	 	- 45 -	 

     

    

 

		6.6.7	Under no circumstances will the maximum aggregate amount of indemnifiable Losses (except for Losses
described in Section 6.10) which may be recovered by the Seller Indemnified Parties for indemnification pursuant
to this Article 6 be greater than the Indemnification Cap.

 

		6.7	Calculation and Mitigation of Losses.

 

		6.7.1	The amount of any Losses for which indemnification is provided under this Article 6
will be net of any amounts recovered by such Indemnified Party under insurance policies or other collateral sources with respect
to such Losses in excess of the sum of (i) reasonable, out-of-pocket costs and expenses relating to collection under such
policies or other collateral sources, and (ii) the deductible associated therewith to the extent actually paid. The Indemnified
Parties will use their commercially reasonable efforts to pursue such insurance policies or collateral sources (which efforts will
not require the initiation of litigation), and in the event the Indemnified Parties receive any recovery, the amount of such recovery
will be applied first, to refund any payments made by the Indemnifying Parties in respect of indemnification claims pursuant
to this Article 6 which would not have been so paid had such recovery been obtained prior to such payment, and second,
any excess to the Indemnified Parties. If a Buyer Indemnified Party fails to pursue recoveries under any “occurrence”
based insurance policies or other collateral sources, then Sellers will have the right of subrogation to pursue such insurance
policies or other collateral sources and may take any reasonable actions necessary to pursue such rights of subrogation in their
name or the name of the party from whom subrogation is obtained. Buyer will reasonably cooperate, and cause its Representatives
and Affiliates (including, after the Closing, the Company) to reasonably cooperate, with Sellers to pursue any such subrogation
claim.

 

		6.7.2	Each Party’s right to indemnification hereunder will be subject to its obligations under
applicable Law, including under common law, to mitigate damages.

 

		6.8	Acknowledgment. For purposes of Section 6.1, any inaccuracy in, or breach
of any statement, or nonfulfillment, nonperformance or other breach of any covenant or agreement by any Sellers or the Company,
and the amount of any Losses associated therewith, will be determined without regard for any materiality, material adverse effect
or similar qualification.

 

		6.9	Exclusive Remedy. The Parties acknowledge, on behalf of themselves and on behalf
of the other Indemnified Parties that, from and after the Closing, except as provided in Sections 1.4, 6.10
and 8.18, their sole and exclusive remedy with respect to the subject matter of this Agreement will be pursuant to
the indemnification provisions set forth in this Article 6. In furtherance of the foregoing, each Party hereby waives,
on behalf of itself and each of the other Indemnified Parties, to the fullest extent permitted under applicable Law, any and all
rights, claims and causes of action it may have against any other Parties arising under or based upon any applicable Law or otherwise
(except pursuant to the indemnification provisions set forth in this Article 6 or as provided in Section 6.10),
including, but not limited to, its right to pursue any action or claim other than as expressly stated in this Agreement.

 

		6.10	Special Rule for Fraud. Nothing in this Article 6 will operate to limit
the common law liability of a Party (the “Liable Party”) to another Party for Losses arising from the fraud
of such Liable Party if such Liable Party is finally determined by a court of competent jurisdiction to have willfully and knowingly
committed fraud against such other Party, with the specific intent to deceive and mislead such other Party, regarding the representations
and warranties made by (i) if a Seller is the Liable Party, such Seller in Article 2 or Article 3 or
(ii) if Buyer is the Liable Party, Buyer in Article 4.

 

    	 	- 46 -	 

     

    

 

Article
7

SELLERS’ REPRESENTATIVE

 

		7.1	Sellers’ Representative Appointment and Powers. The Sellers’ Representative
(or any successor thereto appointed in accordance with Section 7.4) will serve as representative of Sellers with
full power and authority to take all actions under this Agreement and the other Transaction Documents on behalf of Sellers. Each
Seller, by executing this Agreement, hereby irrevocably confirms, designates and appoints the Sellers’ Representative as
the agent, proxy and attorney-in-fact for such Seller for all purposes of this Agreement and the other Seller Transaction Documents,
including full and exclusive power and authority on such Seller’s behalf (a) to consummate the Transactions, (b) to communicate
to, and receive all communications and notices from Buyer, (c) to execute and deliver on behalf of such Seller any amendment or
waiver of this Agreement or the other Seller Transaction Documents, (d) to take all other actions to be taken by or on behalf of
such Seller in connection herewith, (e) to incur fees and expenses as determined by the Sellers’ Representative, (f) to agree
to, negotiate, enter into settlements and compromises of, and commence, prosecute, defend, participate in, settle, dismiss or otherwise
terminate, as applicable, any Proceeding relating to the Company, any Seller, this Agreement, any of the Transaction Documents
or the Transactions, and to comply with orders of courts and awards of courts, mediators and arbitrators with respect to such Proceeding
and (g) to make, execute, acknowledge and deliver all such other agreements, guarantees, orders, receipts, endorsements, notices,
requests, instructions, certificates, stock powers, letters and other writings, and in general, to do any and all things and to
take any and all actions that the Sellers’ Representative, in its sole discretion, may consider necessary or proper or convenient
in connection with or to carry out the Transactions. The Sellers’ Representative will for all purposes be deemed the sole
authorized agent of Sellers until the agency has terminated. Each Seller agrees that such agency and proxy are coupled with an
interest, are therefore irrevocable without the consent of the Sellers’ Representative and will survive the death, incapacity
or bankruptcy of any Seller and will be binding upon the executors, heirs, legal representatives and successors of each Seller.
All actions and decisions of the Sellers’ Representative will be binding upon each Seller, and no Seller will have the right
to object, dissent, protest or otherwise contest such actions or decisions. Neither the Sellers’ Representative nor any agent
employed by it will incur any liability to any Person relating to the performance of its duties hereunder except for actions or
omissions constituting fraud, bad faith, gross negligence or willful misconduct.

 

		7.2	Fees and Expenses. Any expenses or liabilities incurred by the Sellers’ Representative
in connection with the performance of its duties in such capacity under this Agreement or the other Transaction Documents will
be reimbursed to the Sellers’ Representative from the Sellers’ Representative Amount. At such time as the Sellers’
Representative Amount has been exhausted, all additional fees, expenses and liabilities incurred by the Sellers’ Representative
in connection with the performance of its duties hereunder will be paid severally by Sellers in proportion to their Pro Rata Portion.
No Seller will seek reimbursement or indemnification for such fees, expenses or liabilities or otherwise from any of the Company
or Buyer or any of their respective Affiliates. In addition to any other rights or remedies, the Sellers’ Representative
may, upon prior or contemporaneous written notice, offset any amounts determined by it to be owed to the Sellers’ Representative
against the Sellers’ Representative Amount and against any amounts to be paid to Sellers. The Sellers’ Representative
will distribute any portion of the Sellers’ Representative Amount that has not been utilized by it to satisfy its liabilities
or expenses as the Sellers’ Representative or other obligations of Sellers hereunder based on their respective Pro Rata Portions
(net of any amounts owed by any Seller to the Sellers’ Representative) at such time or times as the Sellers’ Representative
may determine in its reasonable discretion.

    	 	- 47 -	 

     

    

 

		7.3	Liability of Sellers’ Representative. Each Seller will severally, but not jointly,
based on such Seller’s Pro Rata Portion, indemnify and hold harmless, the Sellers’ Representative from any and all
losses, liabilities and expenses (including the reasonable fees and expenses of counsel) arising out of or in connection with the
Sellers’ Representative’s execution and performance (solely in its capacity as the Sellers’ Representative and
not in its capacity as a Seller) of this Agreement and the other Transaction Documents, except for fraud, bad faith, gross negligence
or willful misconduct by the Sellers’ Representative. This indemnification obligation will survive the termination of this
Agreement and the other Transaction Documents. The Sellers’ Representative may, in all questions arising under this Agreement,
rely on the advice of counsel, and for anything done, omitted or suffered in good faith by the Sellers’ Representative in
accordance with such advice, the Sellers’ Representative will not be liable to Sellers or any other Person. In no event will
the Sellers’ Representative (solely in its capacity as the Sellers’ Representative and not in its capacity as a Seller)
be liable hereunder or in connection herewith to any Seller for any indirect, punitive, special or consequential damages.

 

		7.4	Resignation or Removal of the Sellers’ Representative. Sellers who, immediately
prior to Closing, are entitled in the aggregate to receive more than fifty percent (50%) of the Estimated Closing Date Purchase
Price may, from time to time upon advance written notice to Buyer, (a) remove the Sellers’ Representative and appoint a new
Sellers’ Representative or (b) appoint a new Sellers’ Representative upon the death, incapacity or resignation of the
Sellers’ Representative and such substituted representative will be deemed to be the Sellers’ Representative for all
purposes under this Agreement. Subject to the appointment and acceptance of a successor Sellers’ Representative as provided
below, the Sellers’ Representative may resign at any time thirty (30) days after giving notice thereof to Sellers. If no
successor Sellers’ Representative will have been appointed by Sellers and accepted such appointment within twenty (20) days
after the retiring Sellers’ Representative’s giving of notice of resignation or Sellers’ removal of the Sellers’
Representative, then the retiring or removed Sellers’ Representative may, on behalf of Sellers, appoint a successor. Upon
the acceptance of any appointment as the Sellers’ Representative hereunder, such successor Sellers’ Representative
will thereupon succeed to and become vested with all the rights, powers, privileges and duties of the retiring or removed Sellers’
Representative, and the retiring or removed Sellers’ Representative will be discharged from its duties and obligations hereunder.
After any retiring or removed Sellers’ Representative’s resignation or removal, as applicable, hereunder as the Sellers’
Representative, this Article 7 will continue in effect for such retiring Sellers’ Representative’s benefit
in respect of any actions taken or omitted to be taken by it while it was acting as the Sellers’ Representative.

 

		7.5	Reliance. Buyer is entitled to rely conclusively upon any document delivered by the
Sellers’ Representative as (a) being genuine and correct and (b) having been duly signed or sent by the Sellers’ Representative.

 

Article
8

MISCELLANEOUS

 

		8.1	Fees and Expenses. Except as expressly set forth in this Agreement, each Party will
pay all fees and expenses incurred by it incident to preparing for, entering into and performing its obligations under this Agreement
and the consummation of the Transactions, whether or not the Transactions are consummated.

 

    	 	- 48 -	 

     

    

 

		8.2	Notices. All notices or other communications permitted or required under this Agreement
will be in writing and will be sufficiently given if and when hand delivered to the Persons set forth below or if sent by documented
overnight delivery service or registered or certified mail, postage prepaid, return receipt requested, or by facsimile or email,
receipt acknowledged, addressed as set forth below or to such other Person or Persons and/or at such other address or addresses
as will be furnished in writing by any Party to the other Parties. Any such notice or communication will be deemed to have been
given as of the date received, in the case of personal delivery, or on the date shown on the receipt or confirmation therefor in
all other cases.

 

If to Buyer or, following
the Closing, the Company:

 

Clarus Corporation

2084 E 3900 S

Salt Lake City, Utah 84124

Attn: Aaron J. Kuehne

Email: akuehne@bdel.com

 

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

 

Kane Kessler, P.C.

666 Third Avenue

New York, New York 10017

Attn.: Robert L. Lawrence, Esq.

Email: rlawrence@kanekessler.com

 

If to any Seller, the
Sellers’ Representative or, prior to the Closing, the Company:

 

BHH Management, Inc.

445 South Figueroa Street, Suite
3250

Los Angeles, CA 90071

Attn: Stephen F. Hinchliffe,
Jr.

Email: shinchliffe@bhhmgmt.com

 

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

 

O’Melveny & Myers LLP

400 South Hope St., 18th
Floor

Los Angeles, CA 90071

Attention: John A. Laco, Esq.

Email: jlaco@omm.com

 

Any Party may at any
time change the address to which notices may be sent under this Section 8.2 by the giving of notice of the change
to the other Parties in the manner set forth in this Section 8.2.

 

    	 	- 49 -	 

     

    

 

		8.3	Releases.

 

		8.3.1	All Contracts between and among the Company, on the one hand, and any Seller or any of its Affiliates
(other than the Company), on the other hand, will be terminated in their entirety upon the Closing by the parties thereto and will
be deemed voided, cancelled and discharged in their entirety and the Company will not have any liability in respect of such Contracts
or the termination thereof.

 

		8.3.2	Effective as of the Closing, each Seller, on behalf of itself and each of its Affiliates, the officers,
directors, employees, investors, shareholders, members or partners of such Seller, agents in their capacity as an agent of such
Seller, successors, permitted assigns, the executors or administrators of such Seller (each, a “Seller Releasing Party”
and, collectively, the “Seller Releasing Parties”), hereby releases, acquits and forever discharges the Company,
its Affiliates, parent and subsidiary companies, predecessors, successors and permitted assigns (including Buyer and its Affiliates),
and their respective former, present and future officers, directors, employees, shareholders, members, managers, partners and agents
(collectively, the “Buyer Released Parties”) of and from any and all manner of action or inaction, cause or
causes of action, Proceedings, debts, Liens, Contracts, Taxes, promises, liabilities, claims, demands, damages (whether for compensatory,
special, incidental or punitive damages, equitable relief or otherwise), Losses, fees, costs or expenses, of any kind or nature
whatsoever, past, present, or future, at law, in equity or otherwise (including with respect to conduct which is negligent, grossly
negligent, willful, intentional, with or without malice, or a breach of any duty, Law or rule), existing or occurring prior to
the Closing, whether known or unknown, whether fixed or contingent, whether concealed or hidden, whether disclosed or undisclosed,
whether liquidated or unliquidated, whether foreseeable or unforeseeable, whether anticipated or unanticipated, whether suspected
or unsuspected, which the Seller Releasing Parties, or any of them, ever have had or ever in the future may have against the Buyer
Released Parties, or any of them, arising by virtue of or in connection with any actions or inactions with respect to the Company
or its affairs on or before the Closing Date; provided, however, that the foregoing release will not release, impair
or diminish, and will not include, in any respect, any rights of such Seller or any other Seller Indemnified Party under this Agreement,
any other Transaction Document or any other Contract entered into pursuant to this Agreement or in connection with the transactions
contemplated hereby. Notwithstanding the foregoing, nothing in this Agreement will be interpreted to release Buyer from any of
its obligations to Sellers under this Agreement, any other Transaction Document or any other Contract entered into pursuant to
this Agreement or in connection with the transactions contemplated hereby.

 

    	 	- 50 -	 

     

    

 

		8.3.3	Effective as of the Closing, Buyer, on behalf of itself and each of its Affiliates (including the
Company), the officers, directors, employees, investors, shareholders, members or partners of Buyer and each of its Affiliates,
agents in their capacity as an agent of Buyer and each of its Affiliates, successors, permitted assigns, the executors or administrators
of Buyer and each of its Affiliates (each, a “Buyer Releasing Party” and, collectively, the “Buyer
Releasing Parties” and, together with the Seller Releasing Parties, the “Releasing Parties”), hereby
releases, acquits and forever discharges each Seller and its Affiliates, parent and subsidiary companies, predecessors, successors
and assigns, and their respective former, present and future officers, directors, employees, shareholders, members, managers, partners,
agents and attorneys (including, without limitation, OMM) (collectively, the “Seller Released Parties” and,
together with the Buyer Released Parties, the “Released Parties”) of and from any and all manner of action or
inaction, cause or causes of action, Proceedings, debts, Liens, Contracts, Taxes, promises, liabilities, claims, demands, damages
(whether for compensatory, special, incidental or punitive damages, equitable relief or otherwise), Losses, fees, costs or expenses,
of any kind or nature whatsoever, past, present, or future, at law, in equity or otherwise (including with respect to conduct which
is negligent, grossly negligent, willful, intentional, with or without malice, or a breach of any duty, Law or rule), existing
or occurring prior to the Closing, whether known or unknown, whether fixed or contingent, whether concealed or hidden, whether
disclosed or undisclosed, whether liquidated or unliquidated, whether foreseeable or unforeseeable, whether anticipated or unanticipated,
whether suspected or unsuspected, which the Buyer Releasing Parties, or any of them, ever have had or ever in the future may have
against the Seller Released Parties, or any of them, arising by virtue of or in connection with any actions or inactions with respect
to the Company or its affairs on or before the Closing Date; provided, however, that the foregoing release will not
release, impair or diminish, and will not include, in any respect any rights of Buyer under this Agreement, any other Transaction
Document or any other Contract entered into pursuant to this Agreement or in connection with the transactions contemplated hereby.
Notwithstanding the foregoing, nothing in this Agreement will be interpreted to release Sellers from any of their respective obligations
to Buyer under this Agreement, any other Transaction Document or any other Contract entered into pursuant to this Agreement or
in connection with the transactions contemplated hereby.

 

		8.3.4	Each Releasing Party hereby irrevocably covenants to refrain from, directly or indirectly, asserting
any claim or commencing, instituting or causing to be commenced any Proceeding of any kind against any Released Party based upon
any matter purported to be released hereby.

 

		8.4	Assignment and Benefit. Neither this Agreement nor any of the rights, interests or
obligations hereunder may be assigned, by operation of Law or otherwise, by any Party to any other Person without the prior written
consent of the other Party, and any such attempted assignment will be null and void; provided, however, that (a) Buyer
may assign its rights and obligations under this Agreement in whole or in part to any of its Affiliates and/or, to the extent granting
a security interest, to any financing sources without the prior written consent of Sellers (provided, that Buyer will remain
primarily liable hereunder following any such assignment and will be deemed to have unconditionally guaranteed the performance
of its obligations hereunder by any such assignee) and (b) any Seller may assign its rights and obligations under this Agreement
to any of its Affiliates without the prior written consent of Buyer (provided, that such Seller will remain primarily liable
hereunder following any such assignment and will be deemed to have unconditionally guaranteed the performance of its obligations
hereunder by any such assignee). The assigning Party will provide the other Party written notice of any such assignment within
ten (10) Business Days following the date of the assignment. Subject to the foregoing, this Agreement and the rights and obligations
in this Agreement will inure to the benefit of, and be binding upon, the Parties and each of their respective permitted successors, heirs
and assigns.

 

		8.5	Amendment, Modification and Waiver. Any provision of this Agreement may be amended,
modified, extended or waived, but only by a written instrument signed by Buyer and the Sellers’ Representative. The waiver
by a Party of any breach of any provision of this Agreement will not constitute or operate as a waiver of any other breach of such
provision or of any other provision hereof, nor will any failure to enforce any provision hereof operate as a waiver of such provision
or of any other provision hereof.

 

    	 	- 51 -	 

     

    

 

		8.6	Due Diligence Review; No Additional Representations and Warranties. Buyer is an informed
and sophisticated purchaser, and, together with Buyer’s Representatives, is experienced in the evaluation and purchase of
businesses such as the Company. Buyer acknowledges and agrees, on behalf of itself and its Affiliates, that (a) Buyer has completed
to its satisfaction its own due diligence investigation, and based thereon, formed its own independent judgment, with respect to
the execution, delivery, and performance of this Agreement and the Transaction Documents, (b) Buyer has been furnished with, or
given full access to, such documents and information about Sellers and the Company as Buyer and its Representatives have deemed
necessary to enable Buyer to make an informed decision with respect to the execution, delivery, and performance of this Agreement
and the Transaction Documents, (c) in entering into this Agreement, Buyer has relied solely upon its own investigation and
analysis and the representations and warranties by Sellers and the Company expressly set forth in Article 2and
Article 3, respectively, (d) except as expressly set forth in Article 2 and Article 3, no
representation or warranty has been or is being made by any Person as to the accuracy or completeness of any information provided
or made available to Buyer or its Representatives and (e) none of Sellers, the Company or any other Person will have or be subject
to any liability to Buyer or any other Person resulting from the distribution to Buyer and its Representatives and Affiliates,
or Buyer’s or any of its Representatives’ or Affiliates’ use, of any written or oral information, and any information,
documents or material made available to Buyer and its Representatives in any form (including any Projections (as defined below)),
other than, in each case, the Transaction Documents. Buyer acknowledges that it and its Representatives have been provided access
to the Data Room and have reviewed the materials contained therein.

 

		8.7	Disclaimer Regarding Projections. In connection with Buyer’s investigation
of the Company, Buyer and its Representatives have received from Sellers (directly or through its Representatives) certain projections,
estimates and other forecasts and certain business plan information (collectively, the “Projections”). Buyer
acknowledges that there are uncertainties inherent in attempting to make the Projections, that it is familiar with such uncertainties,
that it is making its own evaluation of the adequacy and accuracy of all the Projections so furnished to it and any use of, or
reliance by, it on the Projections will be at its sole risk, and without limiting any other provisions of this Agreement, that
it will have no claim against anyone with respect to the Projections; provided, however, that the foregoing will
not be interpreted to waive any rights that Buyer has with respect to recovery for breaches of representations and warranties made
by Sellers in Article 3.

 

		8.8	Interpretation.

 

		8.8.1	Except as otherwise provided or unless the context otherwise requires, whenever used in this Agreement,
(a) any noun or pronoun will be deemed to include the plural and the singular, (b) the use of masculine pronouns will include the
feminine and neuter, (c) the terms “include” and “including” will be deemed to be followed by the
phrase “without limitation,” (d) the word “or” will be inclusive and not exclusive, (e) all references
to Sections or Articles refer to the Sections or Articles of this Agreement, all references to Schedules refer to the Schedules
attached to or delivered with this Agreement, as appropriate, and all references to Exhibits refer to the Exhibits attached to
this Agreement, each of which is made a part of this Agreement for all purposes, (f) each reference to “herein” means
a reference to “in this Agreement,” (g) each reference to “$” or “dollars” will be to United
States dollars, (h) each reference to “days” will be to calendar days, and (i) unless otherwise specified, each
reference to any Contract or Law will be to such Contract or Law as amended, supplemented, waived (in the case of Contracts) or
otherwise modified from time to time.

 

    	 	- 52 -	 

     

    

 

		8.8.2	The provisions of this Agreement will be construed according to their fair meaning and neither
for nor against any Party irrespective of which Party caused such provisions to be drafted. Accordingly, any rule of law or legal
decision that would require interpretation of any ambiguities in this Agreement against the Party that drafted it is of no application
and is hereby expressly waived. Each Party acknowledges that it has been represented by an attorney in connection with the preparation
and execution of the Transaction Documents.

 

		8.8.3	Unless otherwise expressly provided in this Agreement, the measure of a period of one (1) month
or one (1) year for purposes of this Agreement will be that date of the following month or year corresponding to the starting date;
provided, however, that if no corresponding date exists, the measure will be that date of the following month or
year corresponding to the next day following the starting date. For example, one (1) month following February 18th is March 18th,
and one (1) month following March 31 is May 1.

 

		8.8.4	The Disclosure Schedule is hereby incorporated into this Agreement to the same extent as though
fully set forth in this Agreement (provided, that in no event will any information or disclosures therein be deemed or interpreted
to broaden or otherwise amplify the representations and warranties in this Agreement). The Disclosure Schedule is arranged in sections
corresponding to the numbered and lettered sections and subsections contained in this Agreement, and the disclosures in any section
or subsection of the Disclosure Schedule will qualify each other section and subsection in this Agreement to the extent it is reasonably
apparent from a reading of the text of the disclosure that such disclosure is applicable to such other section and subsection.
Information in the Disclosure Schedule under any particular schedule or section therein will be deemed disclosed with respect to
all other schedules or sections therein and any representations, warranties or covenants therein of the Company, Sellers or Buyer
where the applicability of such information to such other schedules or sections or representations, warranties or covenants is
readily apparent, regardless of whether a cross-reference to the applicable section or schedule is actually made. Any matter disclosed
in any of the Disclosure Schedule will not be deemed an admission or representation as to the materiality of the item so disclosed,
and matters disclosed in the Disclosure Schedule are not necessarily limited to matters required by this Agreement to be disclosed
in the Disclosure Schedule. Nothing in the Disclosure Schedule constitutes an admission of any liability or obligation of the Company,
any Seller or the Buyer, as the case may be, to any third party or will confer or give to any third party any remedy, claim, liability,
reimbursement, cause of action or other right.

 

		8.9	Governing Law. This Agreement is made pursuant to, and will be construed and enforced
in accordance with, the laws of the State of Delaware, irrespective of the principal place of business, residence or domicile of
the Parties, and without giving effect to otherwise applicable principles of conflicts of Law that would give effect to the Laws
of another jurisdiction.

 

    	 	- 53 -	 

     

    

 

		8.10	Jurisdiction. Each party to this Agreement, by its execution hereof, hereby (a) irrevocably
submits, and agrees to cause each of its Affiliates to submit, to the exclusive jurisdiction of the Court of Chancery of the State
of Delaware or, to the extent the Court of Chancery of the State of Delaware does not have subject matter jurisdiction, any federal
court within the State of Delaware for the purpose of any action, claim, cause of action or suit (in contract, tort or otherwise)
arising out of or based upon this Agreement, any Transaction Document (unless otherwise set forth therein) or relating to the subject
matter hereof or thereof, (b) waives, and agrees to cause each of its Affiliates to waive, to the extent not prohibited by applicable
Law, and agrees not to assert, and agrees not to allow any of its Affiliates to assert, by way of motion, as a defense or otherwise,
in any such action, any claim that it is not subject personally to the jurisdiction of the above-named courts, that its property
is exempt or immune from attachment or execution, that any such proceeding brought in one of the above-named courts is improper,
or that this Agreement, any Transaction Document (unless otherwise set forth therein) or the subject matter hereof or thereof may
not be enforced in or by such court and (c) agrees not to commence or to permit any of its Affiliates to commence any action, claim,
cause of action or suit (in contract, tort or otherwise) arising out of or based upon this Agreement or relating to the subject
matter hereof other than before one of the above-named courts nor to make any motion or take any other action seeking or intending
to cause the transfer or removal of any such action, claim, cause of action or suit (in contract, tort or otherwise) to any court
other than one of the above-named court whether on the grounds of inconvenient forum or otherwise. NOTWITHSTANDING THE FOREGOING,
(I) THE SEEKING OF INJUNCTIVE RELIEF (INCLUDING, WITHOUT LIMITATION, FOR SPECIFIC PERFORMANCE) SHALL BE SUBJECT TO THE PROVISIONS
OF SECTION 8.18 HEREOF AND (II) THE EXCLUSIVE CHOICE OF FORUM SET FORTH ABOVE SHALL NOT BE DEEMED TO PRECLUDE THE
ENFORCEMENT OF ANY JUDGMENT OBTAINED IN SUCH FORUM OR THE TAKING OF ANY ACTION UNDER THIS AGREEMENT TO ENFORCE THE SAME IN ANY
APPROPRIATE JURISDICTION.

 

		8.11	Waiver of Jury Trial. EACH PARTY HEREBY WAIVES AND COVENANTS THAT IT WILL NOT ASSERT
(WHETHER AS PLAINTIFF, DEFENDANT OR OTHERWISE), TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL
BY JURY IN RESPECT TO ANY PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT, THE OTHER
TRANSACTION DOCUMENTS OR ANY TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY WHETHER NOW EXISTING OR HEREAFTER ARISING, AND WHETHER
SOUNDING IN CONTRACT, TORT OR OTHERWISE. EACH PARTY (A) CERTIFIES THAT NO REPRESENTATIVE OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY
OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF ANY PROCEEDING, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES
THAT IT AND THE OTHER PARTIES HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS
IN THIS SECTION 8.11. EACH OF THE PARTIES MAY FILE A COPY OF THIS PARAGRAPH WITH ANY COURT AS WRITTEN EVIDENCE OF
THE KNOWING, VOLUNTARY AND BARGAINED-FOR AGREEMENT AMONG THE PARTIES TO IRREVOCABLY WAIVE THEIR RESPECTIVE RIGHT TO A TRIAL BY
JURY IN ANY PROCEEDING WHATSOEVER BETWEEN THEM RELATING OT THIS AGREEMENT OR ANY OTHER TRANSACTION AGREEMENT OR ANY OF THE TRANSACTIONS
CONTEMPLATED HEREBY OR THEREBY.

 

    	 	- 54 -	 

     

    

 

		8.12	Conflicts and Privilege. The Company, Buyer and Sellers agree that, notwithstanding
any current or prior representation of any Seller or its Affiliates by O’Melveny & Myers LLP (“OMM”),
OMM will be allowed to represent Sellers or any of their respective Affiliates (which will no longer include the Company after
the Closing) in any matters and disputes, including in any matter or dispute adverse to Buyer and its Affiliates (excluding, after
the Closing, the Company) that either is existing on the date hereof or that arises in the future (provided that this waiver will
not extend to any such future matter or dispute to the extent such future matter or dispute is unrelated to this Agreement and
the Transactions), and Buyer does hereby, and agrees to cause its Affiliates (including, after the Closing, the Company) to, (a)
waive any claim they have or may have that OMM has a conflict of interest or is otherwise prohibited from engaging in such representation
and (b) agree that, in the event of such a matter or dispute, OMM may represent Sellers or such Affiliate in such dispute even
though the interests of Sellers or such Affiliate may be directly adverse to Buyer or its Affiliates (including the Company) and
even though OMM may have represented the Company in a matter substantially related to such dispute, or may be handling ongoing
matters for Buyer or the Company. Buyer further agrees, and agrees to cause its Affiliates (including, after the Closing, the Company)
to agree, that, as to all communications among OMM and Sellers and their respective Affiliates (including, prior to the Closing,
the Company) and any files of OMM that relate in any way to the Transactions contemplated by this Agreement, the attorney-client
privilege, the expectation of client confidence and any attorney work product belongs to, and may be controlled by, Sellers and
will not pass to or be claimed by Buyer or its Affiliates (including, after the Closing, the Company). Accordingly, none of Buyer
or its Affiliates (including the Company) will have access to such communications or to the files of OMM relating to the Transactions
from and after the Closing. Notwithstanding the foregoing, if a dispute arises between Buyer or its Affiliates (including the Company)
and a third party other than a Party to this Agreement after the Closing, the Company will give prompt notice to Sellers and OMM
and assert the attorney-client privilege to prevent disclosure of confidential communications by OMM and any files of OMM to such
third party, and in such case, Buyer and its Affiliates (including the Company) shall have access to such communications or files,
provided they arise from OMM’s representation of the Company (and, for the avoidance of doubt, do not exclusively arise from
OMM’s representation of parties other than the Company); provided, however, that the Company may not waive
such privilege or other protection, and Buyer and its Affiliates (including the Company) shall not have such access, without the
prior written consent of the Sellers’ Representative, which consent shall not be unreasonably withheld, delayed or conditioned.
Sellers agree that, as to all communications between OMM and the Company prior to the Closing that do not relate in any way to
the Transactions contemplated by this Agreement, the attorney-client privilege, the expectation of client confidence and any attorney
work product belongs to, and may be controlled by, Buyer and passes to Buyer (including, after the Closing, the Company). Accordingly,
from and after the Closing, Buyer (and, after the Closing, the Company) will have access to such communications and to the files
of OMM relating to OMM’s representation of the Company other than with respect to the Transactions. Nothing herein is intended
to waive OMM’s rights to protect its own work product.

 

		8.13	Section Headings. The section headings of this Agreement are for reference purposes
only and will not in any way affect the meaning or interpretation of this Agreement.

 

		8.14	Severability. If any provision of this Agreement (or portion thereof) or the application
of any such provision (or portion thereof) to any Person or circumstance is determined by a court of competent jurisdiction to
be invalid, illegal or incapable of being enforced pursuant to any applicable Law or public policy, all other provisions of this
Agreement (or remaining portion of such provision) will nevertheless remain in full force and effect. Upon such determination by
a court of competent jurisdiction that any provision (or portion thereof) of this Agreement is invalid, illegal or incapable of
being enforced, the Parties will negotiate in good faith to modify this Agreement so as to effect the original intent of the Parties
as closely as possible in an acceptable manner, to the end that the Transactions as originally contemplated are fulfilled to the
extent possible.

 

    	 	- 55 -	 

     

    

 

		8.15	Counterparts; Third-Party Beneficiaries. This Agreement may be executed in one or
more counterparts, including by facsimile or PDF transmission, each of which will be deemed an original, but all of such counterparts
together will be deemed to be one and the same agreement. This Agreement will be binding upon and inure solely to the benefit of
each Party, and, except as set forth in Section 5.7 or Article 6, nothing in this Agreement, express
or implied, is intended to or will confer upon any other Person (other than OMM) any right, benefit or remedy of any nature whatsoever
under or by reason of this Agreement.

 

		8.16	Entire Agreement. This Agreement, together with the Disclosure Schedule and the other
Transaction Documents, constitute the entire agreement among the Parties with respect to the Transactions and supersede all prior
and contemporaneous agreements and understandings, both written and oral, with respect to the subject matter hereof. There are
no warranties, representations, or other agreements between the Parties hereto, or on which any of them has relied in connection
with the subject matter hereof, except as specifically set forth in this Agreement or in the other Transaction Documents.

 

		8.17	Attorneys’ Fees. Subject to the limitations set forth in this Agreement, in
the event of any dispute related to or based upon this Agreement, the prevailing Party will be entitled to recover from the other
Party its reasonable attorneys’ fees and costs.

 

		8.18	Specific Performance. Each Party acknowledges and agrees that the other Parties would
be damaged irreparably if any of the provisions of this Agreement were not performed in accordance with their specific terms or
otherwise were breached or violated. Accordingly, each Party agrees that, without posting bond or other undertaking, the other
Parties will be entitled to an injunction or injunctions to prevent breaches or violations of this Agreement and to enforce specifically
this Agreement in any claim, action, cause of action or suit (whether in Contract or tort or otherwise), litigation (whether at
law or in equity, whether civil or criminal), controversy, assessment, arbitration, investigation, hearing, charge, complaint,
demand, notice or proceeding to, from, by or before any Governmental Authority having jurisdiction over the Parties and the matter
in addition to any other remedy to which it may be entitled, at law or in equity, and that Party agrees to cooperate fully in any
attempt by the other Parties in obtaining any such equitable remedy. Each Party further agrees that, in the event of any action
for specific performance in respect of such breach or violation, it will not assert the defense that a remedy at law would be adequate
or that the consideration reflected in this Agreement was inadequate or that the terms of this Agreement were not just and reasonable.

 

		8.19	Incorporation of Schedules and Exhibits. The Schedules and Exhibits identified in
this Agreement are incorporated herein by reference and made a part of this Agreement.

 

		8.20	Termination of Operating Agreement. Each Seller agrees that the Limited Liability
Company Agreement of the Company dated as of December 15, 1995 (the “Operating Agreement”), will be of no further
force and effect from and after the Closing, and hereby waives any and all (a) notice requirements and (b) rights or restrictions
with respect to the transfer of the capital stock, membership interests or other Equity Interests of the Company set forth in the
Operating Agreement. Effective upon such termination of the Operating Agreement, each of the Sellers hereby waives any and all
rights under the Operating Agreement and, except for the continuing obligations provided for in this Agreement or the other Transaction
Documents, releases all other parties to the Operating Agreement from all obligations, commitments, liabilities or claims arising
thereunder.

 

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Blank]

 

    	 	- 56 -	 

     

    

 

IN WITNESS WHEREOF,
each Party has duly executed this Agreement, or has caused this Agreement to be duly executed on its behalf by a duly authorized
Representative, all as of the date first set forth above.

 

	 	“COMPANY”
	 	 
	 	
        Sierra Bullets, L.L.C.,

        a Delaware limited liability company

	 	 
	 	By: BHH Management, Inc., its Managing Member
	 	 
	 	By:	/s/ Stephen F. Hinchliffe, Jr.
	 	Name:	Stephen F. Hinchliffe, Jr.
	 	Title:	President and Secretary

 

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	 	“BHH”
	 	 
	 	
        BHH Management, Inc.,

        a California corporation

	 	 
	 	By:	/s/ Stephen F. Hinchliffe, Jr.
	 	Name:	Stephen F. Hinchliffe, Jr.
	 	Title:	President and Secretary

 

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	 	“LMI”
	 	 
	 	
        Lumber Management, Inc.,

        a Delaware Corporation

	 	 
	 	By:	/s/ George D. Herrmann, Jr.
	 	Name:	George D. Herrmann, Jr.
	 	Title:	Chairman and Chief Executive Officer

 

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	 	“SELLERS’ REPRESENTATIVE”
	 	 
	 	
        BHH Management, Inc.,

        a California corporation

	 	 
	 	By:	/s/ Stephen F. Hinchliffe, Jr.
	 	Name:	Stephen F. Hinchliffe, Jr.
	 	Title:	President and Secretary

 

[Signatures Continue on Next Page]

 

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	 	“BUYER”
	 	 
	 	
        Everest/Sapphire Acquisition, LLC

        a Delaware limited liability company

	 	 
	 	 
	 	By:	/s/ Aaron J. Kuehne
	 	Name:	Aaron J. Kuehne
	 	Title:	Secretary and Treasurer

 

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EXHIBIT A

 

DEFINITIONS

 

“Accounting
Principles” means GAAP, as applied using the same accounting methods, policies, principles, practices and procedures
(including classifications, judgments and estimation methodologies) as were used in the preparation of the Financial Statements,
in each case subject to the specific methods, policies, principles, practices and procedures used in the preparation of the Estimated
Closing Statement pursuant to Section 1.4.1 and Exhibit C.

 

“Affiliate”
means, with respect to any Person, any other Person controlling, controlled by, or under common control with such other Person.
For purposes of this definition, “control,” when used with respect to any Person, means the power to direct
the management and policies of such Person, directly or indirectly, whether through the ownership of voting securities, by Contract
or otherwise, and the terms “controlling” and “controlled” have correlative meanings. Notwithstanding
the foregoing, for purposes of this Agreement, the Company will not be considered an Affiliate of any Seller.

 

“Base Purchase
Price” means an amount in cash equal to seventy-nine million dollars ($79,000,000).

 

“Bonus Payments”
means, collectively (i) a payment to Patrick Daly in the amount of one million eight hundred ninety-two thousand eight hundred
ninety-five dollars ($1,892,895) in accordance with that certain Bonus Agreement dated as of July 1, 2014, between Patrick Daly
and the Company, and (ii) a payment to Roy Douglas Wickham in the amount of one million eight hundred ninety-two thousand eight
hundred ninety-five dollars ($1,892,895) in accordance with that certain Bonus Agreement dated as of July 1, 2014, between Roy
Douglas Wickham and the Company.

 

“Business”
means the business and operations of the Company, as conducted as of the Closing Date.

 

“Business
Day” means a day, other than Saturday, Sunday or other day on which commercial banks in the State of Delaware are authorized
or required by law to close.

 

“Buyer Transaction
Documents” means those Transaction Documents to which Buyer is or, as of the Closing, will be, a party.

 

“Cash”
means the aggregate cash and cash equivalents (including bank account balances and deposits in transit or not yet recorded), including
any evidences of short-term, highly liquid investments with original maturities of ninety (90) days or less, calculated in accordance
GAAP.

 

“Closing Date
Purchase Price” means an amount equal to

 

		(i)	the sum of the following amounts, without duplication:

 

		(A)	the Base Purchase Price;

 

		(B)	the Closing Cash;

 

		(C)	an amount equal to the absolute value of the Closing
Working Capital less the Target Working Capital, if a positive number; and

 

    Exhibit A-1 

     

    

 

		(ii)	less the sum of the following amounts, without
duplication:

 

		(A)	the Closing Indebtedness;

 

		(B)	the Closing Transaction Expenses;

 

		(C)	the Sellers’ Representative Amount; and

 

		(D)	an amount equal to the absolute value of the Closing
Working Capital less the Target Working Capital, if a negative number.

 

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

 

“Company’s
Knowledge” with respect to the Company means the actual knowledge, after due inquiry, of each of the Key Employees and
the Sellers.

 

“Confidentiality
Agreement” means that certain Confidentiality Agreement, dated March 23, 2017, between the Company and Clarus Corporation
(formerly known as Black Diamond, Inc.).

 

“Consent”
means any consent, approval, authorization, notice, waiver, filing or notification required to be obtained by any Seller or the
Company from, filed by any Seller or the Company with, or delivered by any Seller or the Company to, any Person in connection with
the consummation of the Transactions.

 

“Contract”
means any legally binding contract, lease or other property agreement, license, indenture, note, bond, agreement, undertaking,
arrangement, indemnity, lease, permit, concession, franchise, commitment, purchase order, mortgage, partnership or joint venture
agreement, instrument or other legally binding agreement whether in writing or not.

 

“Copyrights”
means all copyrightable works of authorship (whether published or unpublished), all registered or unregistered copyrights, all
copyright registrations, applications for registration and renewals, extensions, and all rights corresponding to the foregoing
throughout the world, including rights to prepare, reproduce, perform, display, and distribute copyrighted works and copies, unregistered
copyrightable works and works of authorship, compilations and derivative works thereof.

 

“Data Room”
means the electronic data room as of the Closing Date with Intralinks entitled “Project Emerald”.

 

“Defect”
means a defect or impurity, whether in design, manufacture, processing, or otherwise, including any dangerous propensity associated
with any reasonably foreseeable use of a Product, or the failure to warn of the existence of any defect, impurity, or dangerous
propensity.

 

“Disclosure
Schedule” means the schedules attached hereto as Exhibit B.

 

“Environmental
Claim” means any and all administrative, regulatory or judicial orders, suits, demands, demand letters, directives, claims,
liens, administrative proceedings, or written notices of noncompliance or violation, by any Person (including, without limitation,
any Governmental Authority) alleging liability or potential liability (including, without limitation, potential responsibility
for or liability for enforcement, investigatory costs, cleanup costs, governmental response costs, removal costs, remedial costs,
natural resources damages, closure costs, supplemental environmental projects, property damages, personal injuries, penalties,
and leaking underground storage tanks) arising out of, based on or resulting from (a) the presence, or Release or threatened Release,
of any Hazardous Materials at the Real Property, or (b) circumstances forming the basis of any violation or alleged violation of
any Environmental Law, or (c) any and all claims by any third party seeking damages, contribution, indemnification, cost recovery,
compensation or injunctive relief resulting from the presence or Release of any Hazardous Materials.

 

    Exhibit A-2 

     

    

 

“Environmental
Law” means any applicable Law relating to the pollution or the protection of the environment or natural resources, including
the Comprehensive Environmental Response, Compensation and Liability Act (42 U.S.C. §§ 9601 et seq.) (“CERCLA”),
the Hazardous Materials Transportation Act (49 U.S.C. §§ 5101 et seq.), the Resource Conservation and Recovery Act (42
U.S.C. §§ 6901 et seq.), the Clean Water Act (33 U.S.C. §§ 1251 et seq.), the Clean Air Act (42 U.S.C. §§
7401 et seq.), the Toxic Substances Control Act (15 U.S.C. §§ 2601 et seq.), and the Federal Insecticide, Fungicide,
and Rodenticide Act (7 U.S.C. §§ 136 et seq.) and the regulations promulgated pursuant thereto.

 

“Environmental
Permits” means the Governmental Authorizations required under applicable Environmental Laws reasonably necessary to operate
the Business.

 

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

 

“ERISA Affiliate”
means any Person that, together with the Company, would be deemed a “single employer” within the meaning of Sections
414(b), (c), (m) or (o) of the Code.

 

“Estimated
Closing Date Purchase Price” means an amount equal to

 

		(i)	the sum of the following amounts, without duplication:

 

		(A)	the Base Purchase Price;

 

		(B)	the Estimated Closing Cash;

 

		(C)	an amount equal to the absolute value of the Estimated
Closing Working Capital less the Target Working Capital, if a positive number; and

 

		(ii)	less the sum of the following amounts, without
duplication:

 

		(A)	the Estimated Closing Indebtedness;

 

		(B)	the Estimated Closing Transaction Expenses;

 

		(C)	the Sellers’ Representative Amount; and

 

		(D)	an amount equal to the absolute value of the Estimated
Closing Working Capital less the Target Working Capital, if a negative number.

 

“Equity Interests”
means, with respect to any Person, (a) the capital stock, partnership interests, membership interests, beneficial interests or
any other equity or ownership interests in such Person or (b) any instruments convertible into or exchangeable for, or whose value
is determined by reference to, any such interests.

 

“Fundamental
Representations” means (i) with respect to each Seller, the representations of such Seller set forth in Sections
2.1 (Organization and Good Standing), 2.2 (Power and Authorization; Enforceability), 2.4 (Ownership),
as applicable, Sections 3.1 (Organization and Good Standing), 3.2 (Power and Authorization; Enforceability),
3.4 (Capitalization), 3.17 (Environmental Matters), 3.18 (Tax Matters) and 3.22
(Brokers) and (ii) with respect to Buyer, the representations and warranties of Buyer set forth in Sections 4.1 (Organization
and Good Standing), 4.2 (Power and Authorization; Enforceability) and 4.6 (Brokers).

 

    Exhibit A-3 

     

    

 

“GAAP”
means United States generally accepted accounting principles as in effect on the Closing Date.

 

“Governing
Documents” means, with respect to any Person, (a) the articles of incorporation, certificate of incorporation, certificate
of formation or memorandum or articles of association (or the equivalent organizational documents) of such Person, (b) the bylaws
or operating agreement (or the equivalent governing documents) of such Person and (c) any document setting forth the designation,
amount or relative rights, limitations and preferences of any class or series of such Person’s authorized stock or other
Equity Interests.

 

“Governmental
Authority” means (i) the United States federal government or the government of any other country, (ii) the government
of any state, commonwealth, province, county, city, territory, or possession or (iii) any quasi-government, municipality, political
subdivision, courts, departments, commissions, boards, bureaus, tribunals, agencies, arbitrator, mediator or other instrumentalities
of any of the foregoing in subparts (i) and (ii).

 

“Governmental
Authorization” means any approval, consent, license, permit or other authorization issued, granted, given or otherwise
made available by or under the authority of any Governmental Authority or pursuant to any Laws.

 

“Hazardous
Material” means petroleum, petroleum by-products, polychlorinated biphenyls, friable asbestos, radon, radioactive materials
or wastes, lead or lead-containing materials, urea formaldehyde foam insulation, and any other chemicals, materials, substances
or wastes which are, as of the date of this Agreement or the Closing Date, defined or regulated as “hazardous substances,”
“hazardous materials,” “hazardous wastes,” “extremely hazardous wastes,” “restricted
hazardous wastes,” “toxic substances,” “toxic pollutants,” “toxic air pollutants,” “hazardous
air pollutants,” “pollutants,” or “contaminants” under any Environmental Law or that is hazardous,
acutely hazardous, toxic, or words of similar import or regulatory effect under Environmental Laws.

 

“Indebtedness”
means, with respect to any Person, at a particular time, the sum of all of the following without duplication, whether or not included
as indebtedness in accordance with the Accounting Principles: (a) all obligations of such Person for borrowed money, whether secured
or unsecured, and all obligations of such Person evidenced by bonds, debentures, notes, loan agreements or similar debt instruments;
(b) all obligations (contingent or otherwise) of such Person to pay the deferred purchase price of any property or services (including
the maximum potential amount payable with respect to earn-outs, purchase price adjustments or other payments related to acquisitions)
(other than accrued expenses and accounts payable in the Ordinary Course and reflected as a current liability in the calculation
of Closing Working Capital); (c) all obligations of such Person in respect of any lease of (or other arrangements conveying the
right to use) real or personal property, or a combination thereof, which obligations are required to be classified and accounted
for under the Accounting Principles as a capital lease; (d) all liabilities under any swap, future or option agreement or other
similar Contracts, instruments or derivatives designed to protect the Company against fluctuations in interest rates, foreign exchange
or other capital market risks; and (e) all indebtedness referred to in the foregoing clauses (a) through (d) which is directly
or indirectly guaranteed by such Person.

 

“Indemnification
Cap” means an amount equal to ten percent (10%) of the Base Purchase Price.

 

    Exhibit A-4 

     

    

 

“Independent
Accounting Firm” means Ernst & Young or, if Ernst & Young is unavailable or unwilling to serve, a mutually acceptable
nationally recognized firm of independent certified public accountants that has not provided services to either Sellers or Buyer
and its Subsidiaries in the preceding two (2) years; provided, that if Buyer and the Sellers’ Representative are unable
to select such firm or expert within sixty (60) days after delivery of written notice of a disagreement, either Buyer or the Sellers’
Representative may request the American Arbitration Association to appoint, within twenty (20) Business Days from the date of such
request, an independent accounting firm meeting the requirements set forth above or a neutral and impartial certified public accountant
with significant arbitration experience related to purchase price adjustment disputes relating to transactions of a similar nature.

 

“Intellectual
Property” means all United States, foreign, international and state: (i) Patents, (ii) Trademarks, (iii) Internet domain
names, (iv) Copyrights, including in computer software and databases, (v) registrations and applications for any of the foregoing
(i) through (iv), (vi) Trade Secrets; (vii) uniform resource locators and Internet domain names and related registrations and applications
and any and all renewals or extensions; (viii) moral rights associated with any of the foregoing; (ix) rights of privacy and publicity,
including the names, likenesses, voices and biographical information of real persons; (x) other intellectual property rights, in
each case whether registered or unregistered and including any and all applications (or rights to apply) for, and renewals or extensions
of, such rights and all similar or equivalent rights or forms of protection which subsist or will subsist now or in the future
or in any part of the world; and (xi) all other intellectual property and proprietary rights.

 

“Judgment”
means any judgment, decision, order, decree, writ, injunction or ruling entered or issued by any Governmental Authority.

 

“Key Employees”
means Patrick Daly and Roy Douglas Wickham.

 

“Laws”
means any federal, national, provincial, state, local, United States, foreign or other law (both common and statutory law and civil
and criminal law), statute, rule, regulation, treaty, ordinance, convention, rule, code, decree, Judgment, writ, regulatory code
(including statutory instruments, guidance notes, circulars, directives, decisions, rules, regulations or restrictions) or other
order, or other requirement or rule of law of any Governmental Authority.

 

“Lien”
means any mortgage, deed of trust, hypothecation, pledge, lien (statutory or otherwise), security interest, charge or encumbrance
of any kind, whether voluntary or involuntary (including any conditional sale or other title retention agreement, any lease in
the nature thereof and any agreement to give any security interest) and, with respect to capital stock, any option or other right
to purchase or any restriction on voting or other rights.

 

“Losses”
means any and all direct and actual losses, damages, penalties, fines, amounts paid in settlement, costs and expenses (including
settlement and court costs and reasonable attorneys’ fees and expenses) net of any corresponding insurance proceeds of any
of the foregoing, but excluding any punitive damages. For the avoidance of doubt, Losses shall include the reasonable fees and
disbursements of one firm of counsel to an Indemnified Party incurred in connection with a claim brought against an Indemnifying
Party pursuant to Article 6 whether or not such claim is a Third Party Claim.

 

“Material
Adverse Effect” means a material adverse effect on (i) the Company or the assets, results of operations or financial
condition thereof, taken as a whole, or (ii) the ability of Sellers to consummate the Transactions; provided, that any such
change or effect resulting from any of the following, individually or in the aggregate, will not be considered when determining
whether a Material Adverse Effect has occurred for purposes of clause (i) above: (A) any change in economic conditions generally
or capital and financial markets generally, including changes in interest or exchange rates, (B) any change in the industry in
which the Company operates, (C) any change in Laws or accounting standards, or the enforcement or interpretation thereof, applicable
to the Company, (D) conditions caused by acts of war, sabotage, terrorism or military actions, or any escalation or worsening of
any of the foregoing, (E) any hurricane, flood, tornado, earthquake or other natural disaster or (F) the failure in and of itself
of the Company to achieve any financial projections or forecasts (but not the underlying cause of such failure); provided,
that any adverse effects resulting from matters described in any of the foregoing clauses (A), (B), (C), (D) or (E) may be taken
into account in determining whether there is or has been a Material Adverse Effect to the extent, and only to the extent, that
they have a disproportionate effect on the Company relative to other participants in the industries in which the Company operates.

 

    Exhibit A-5 

     

    

 

“Net Working
Capital” means (without duplication), with respect to the Company at any given time, the current assets of the Company
less the current liabilities of the Company, in each case, as calculated in accordance with the Accounting Principles.

 

“Ordinary
Course” means in the ordinary course of the Business, consistent with past practices.

 

“Patents”
means all patents and patent applications, patentable inventions and improvements, and provisionals, non-provisionals, continuations,
continuations in part, reissues, reexaminations, divisions, renewals, extensions, or disclosures relating to any of the foregoing,
industrial designs, industrial design registrations and applications for industrial design registrations, certificates of invention,
utility models and any and all other rights to inventions.

 

“Permitted
Liens” means (i) Liens for Taxes and other governmental charges and assessments that are not yet due and payable, and
Liens for current Taxes and other charges and assessments of any Governmental Authority that may thereafter be paid without penalty
or that are being contested in good faith by appropriate proceedings, in each case for which adequate reserves are being maintained
in accordance with the Accounting Principles, (ii) Liens of landlords, lessors, carriers, warehousemen, employees, mechanics and
materialmen and other like Liens arising in the Ordinary Course, (iii) all restrictions of record identified in any title reports
obtained by or made available to Buyer; provided same do not prohibit the use of any Real Property as it is currently being used
by the Company, (iv) all non-exclusive licenses to Intellectual Property, (v) all local and other Laws, including building and
zoning Laws, now or hereafter in effect relating to or affecting any real property, provided same do not impair the use and operation
of such real property for the Business conducted thereon (vi) Liens of lenders incurred in deposits made in the Ordinary Course
in connection with maintaining bank accounts, and (vii) deposits or pledges to secure the payment of workers’ compensation,
unemployment insurance, social security benefits or obligations arising under similar Laws, or to secure the performance of public
or statutory obligations, surety or appeal bonds, and other obligations of a like nature.

 

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

 

“Personal
Information” means any information that alone or in combination with other information held by the Company can be used,
directly or indirectly, to specifically identify an individual, other than their business contact information when used or disclosed
for the purpose of contacting such individual in that individual’s capacity as an employee or an official of an organization
and for no other purpose.

 

“Post-Closing
Tax Period” means any period (or portion thereof) beginning after the Closing Date.

 

“Pre-Closing
Tax Period” means any period (or portion thereof) ending on or prior to the Closing Date.

 

    Exhibit A-6 

     

    

 

“Pro Rata
Portion” means with respect to each Seller, the percentage of the Estimated Closing Date Purchase Price of such Seller
set forth opposite such Seller’s name on Exhibit D attached hereto under the heading “Pro Rata Portion”
(which percentages will be provided by the Company (with a copy to the Sellers’ Representative) on behalf of Sellers pursuant
to Section 1.3).

 

“Proceeding”
means any action, arbitration, audit, hearing, investigation, litigation or suit (whether civil, criminal, administrative, investigative
or informal) commenced, brought, conducted or heard by or before, or otherwise involving, any Governmental Authority or arbitrator.

 

“Product”
means any product designed, manufactured, sold, distributed and/or otherwise introduced into the stream of commerce, by or on behalf
of the Company, including any product sold by the Company as the distributor, agent, or pursuant to any other contractual relationship
with a manufacturer.

 

“Release”
has the meaning set forth in CERCLA.

 

“Remedies
Exception” means applicable bankruptcy, insolvency, reorganization, moratorium and other similar existing or future Laws
relating to or limiting creditors’ rights generally, and general principles of equity relating to the availability of specific
performance and injunctive and other forms of equitable relief.

 

“Representative”
or “Representatives” means, with respect to a particular Person, any director, manager, member, limited or general
partner, officer, employee, agent, consultant, advisor or other representative of such Person, including outside legal counsel,
accountants and financial advisors.

 

“Restriction
Period” means the period beginning on the Closing Date and ending upon the fifth (5th) anniversary of the
Closing Date.

 

“Rights”
means any subscriptions, options, warrants, rights (including phantom equity or equity appreciation rights), preemptive rights,
voting, approval or proxy rights, or right of registration, conversion or exchange with respect to any of the Equity Interests
of the Company, or any Contract obligating the Company, or any Affiliate of the Company, to issue, sell, purchase or register any
Equity Interests of the Company or to grant, extend or enter into any Contract with respect to the Equity Interests of the Company.

 

“Sellers’
Representative Amount” means an amount in cash equal to five hundred thousand dollars ($500,000).

 

“Step-down
Date” means the date which is the twelve (12) month anniversary of Closing.

 

“Subsidiary”
means, with respect to any specified Person, any corporation, partnership, limited liability company, or other entity of which
more than fifty percent (50%) of the outstanding capital stock or other ownership interests having ordinary voting power to elect
a majority of the board of directors or other managers of such corporation, partnership, limited liability company, or other entity
is at the time directly or indirectly owned by, or the management is otherwise controlled by, such Person (irrespective of whether,
at the time, capital stock or other ownership interests of any other class or classes of such corporation, partnership, limited
liability company, or other entity have or might have voting power by reason of the happening of any contingency).

 

    Exhibit A-7 

     

    

 

“Target Working
Capital” means ten million four hundred thousand dollars ($10,400,000).

 

“Tax”
or “Taxes” means all federal, state, local or foreign income taxes (including any tax on or based upon net income,
gross income, or income as specially defined, or earnings, profits, or selected items of income, earnings or profits) and all gross
receipts, sales, use, ad valorem, transfer, franchise, license, capital stock, withholding, social security, unemployment, disability,
or windfall profit taxes, alternative or add-in minimum taxes, together with any interest and any penalties and additions to tax.

 

“Tax Agreement”
means an agreement the principal purpose of which is the sharing or allocation of, or indemnification for, Taxes.

 

“Tax Return”
means all federal, state, local, provincial and foreign return, declaration, report, or information return or statement relating
to Taxes, including any schedules and amendments thereto.

 

“Taxing Authority”
means any Governmental Authority responsible for the assessment, imposition or collection of any Tax.

 

“Threshold”
means $800,000 in the aggregate until the Step-down Date. After the Step-down Date the Threshold shall be reduced to the lesser
of (i) $400,000 in the aggregate and (ii) the difference of (x) $800,000, minus (y) the total amount of Losses then incurred or
reasonably expected to be incurred by the Buyer Indemnified Parties that are not excluded under the Representation and Warranty
Insurance Policy, resulting from claims noticed to the insurer under the Representation and Warranty Insurance Policy on or prior
to the Step-down Date.

 

“Trademarks”
means all trademarks, service marks, certification marks, corporate names, trade names, trade dress, fictitious names, assumed
names, logos, slogans, other indicia of commercial source or origin, general intangibles of like nature, and any and all registrations
and applications for any of the foregoing, together with all goodwill related to the foregoing.

 

“Trade Secrets”
means all non-public technology, inventions, invention disclosures, trade secrets and know-how and other proprietary information,
including proprietary processes, formulae, algorithms, models and methodologies;

 

“Transaction
Documents” means this Agreement, the Disclosure Schedule and the other agreements, certificates, schedules and other
documents contemplated by or delivered or executed by the Parties in connection with this Agreement, including, but not limited
to, the Buyer Transaction Documents, the Company Transaction Documents and the Seller Transaction Documents.

 

“Transaction
Expenses” means, without duplication, the sum of any fees, costs and expenses incurred or payable by the Company or Sellers
in connection with the drafting, negotiation, execution and delivery of this Agreement and the other Transaction Documents and
the consummation of the Transactions, including, without limitation, all Bonus Payments and any sale bonus, success, retention,
change of control or similar payment, severance or other payment incurred or payable by the Company as a result of the consummation
of the Transactions (including any such payments under any Benefit Plan), together with all payroll, employment or similar Taxes
imposed with respect to any such payment, but excluding the Sellers’ Representative Amount.

 

“Voting Debt”
means Indebtedness having general voting rights and debt convertible into securities having such rights.

 

“WARN Act”
means the Worker Adjustment and Retraining Notification Act of 1988.

 

    Exhibit A-8 

     

    

 

Other capitalized terms defined elsewhere
in the Agreement and not defined in this Exhibit A will have the meanings assigned to such terms in this Agreement
in the sections referenced below.

  

	Term	Section
	Agreement	Introduction
	Allocation Schedule	Section 5.5.8
	BHH	Introduction
	BHH Interest	Background Paragraph A
	Buyer	Introduction
	Buyer Indemnified Parties	Section 6.1
	Buyer Indemnified Party	Section 6.1
	Buyer Released Parties	Section 8.3.2
	Buyer Releasing Parties	Section 8.3.3
	Buyer Releasing Party	Section 8.3.3
	Closing	Section 1.1
	Closing Cash	Section 1.4.2
	Closing Date	Introduction
	Closing Indebtedness	Section 1.4.2
	Closing Statement	Section 1.4.2
	Closing Transaction Expenses	Section 1.4.2
	Company	Introduction
	Company Insurance Policy	Section 3.11
	Company IP Agreements	Section 3.14.3
	Company Licensed Intellectual Property	Section 3.14.3
	Company Owned Intellectual Property	Section 3.14.2
	Company Returns	Section 3.18.1
	Company Transaction Documents	Section 3.2.1
	Continuing Employees	Section 5.6.1
	Controlling Party	Section 6.3.2(b)
	Covered Person	Section 5.7.1
	Customer Contract Forms	Section 3.10.6
	Determination Date	Section 1.4.5
	Disputed Items	Section 1.4.3
	Employee Benefit Plans	Section 3.16.1
	Employees	Section 3.15.2
	ERISA	Section 3.16.1
	Estimated Closing Cash	Section 1.4.1
	Estimated Closing Indebtedness	Section 1.4.1
	Estimated Closing Statement	Section 1.4.1
	Estimated Closing Transaction Expenses	Section 1.4.1
	Estimated Closing Working Capital	Section 1.4.1
	Financial Statements	Section 3.7.1
	General Indemnification Period	Section 6.4
	Indemnification Tax Benefit	Section 6.6.4
	Indemnified Party	Section 6.3.1
	Indemnifying Party	Section 6.3.1
	Insurance Organizations	Section 3.9.5
	Inter-Party Claim	Section 6.3.1
	Latest Balance Sheet	Section 3.7.1

 

    Exhibit A-9 

     

    

 

	Latest Balance Sheet Date	Section 3.7.1
	Leased Real Property	Section 3.9.2
	Liabilities	Section 3.7.2
	Liable Party	Section 6.10
	LMI	Introduction
	LMI Interest	Background Paragraph A
	Material Contracts	Section 3.10.1
	Members	Section 5.7.1
	Most Recent Fiscal Year End	Section 3.7.1
	OECD Convention	Section 3.25
	OMM	Section 8.12
	Operating Agreement	Section 8.20
	Owned Real Property	Section 3.9.1
	Non-Controlling Party	Section 6.3.2(b)
	Parties	Introduction
	Party	Introduction
	Payoff Amounts	Section 1.3.1(c)
	Payoff Letters	Section 1.3.1(c)
	Post-Closing Straddle Period	Section 5.5.5
	Pre-Closing Straddle Period	Section 5.5.5
	Pre-Closing Tax Refund	Section 5.5.3
	Present Fair Salable Value	Section 4.9
	Prohibited Activities	Section 5.4.1
	Projections	Section 8.7
	Real Property	Section 3.9.2
	Real Property Leases	Section 3.9.2
	Real Property Permits	Section 3.9.5
	Receivables	Section 3.20.2
	Registered Owned Intellectual Property	Section 3.14.1
	Released Parties	Section 8.3.3
	Releasing Parties	Section 8.3.3
	Representation and Warranty Insurance Policy	Section 1.3.2(c)
	Resolution Period	Section 1.4.4
	Seller Indemnified Parties	Section 6.2
	Seller Indemnified Party	Section 6.2
	Seller Released Parties	Section 8.3.3
	Seller Releasing Parties	Section 8.3.2
	Seller Releasing Party	Section 8.3.2
	Seller Transaction Documents	Section 2.2.1
	Sellers	Introduction
	Sellers’ Representative	Introduction
	Solvency	Section 4.9
	Solvent	Section 4.9
	Straddle Period	Section 5.5.5
	Third Party Claim	Section 6.3.2
	Threshold	Section 6.5.2
	Top Customers	Section 3.19.1
	Top Suppliers	Section 3.19.2
	Transactions	Background Paragraph B
	Transfer Taxes	Section 5.5.6
	Transferred Interests	Background Paragraph A

 

    Exhibit A-10 

     

    

 

	Unaudited Financial Statements	Section 3.7.1
	Unresolved Items	Section 1.4.5
	Work Interference	Section 3.15.1

 

    Exhibit A-11

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