Document:

Certificate of Designations

 Exhibit 10.6 
  
 CERTIFICATE OF DESIGNATIONS, PREFERENCES AND RIGHTS 
  
 OF 
  
 SERIES M CONVERTIBLE PREFERRED STOCK 
  
 OF 
  
 VELOCITY EXPRESS CORPORATION 
  
 (Pursuant to Section 151 of the 
 Delaware General Corporation Law) 
  
 Velocity Express Corporation, a corporation organized and existing under the
laws of the State of Delaware (the “Company”), hereby certifies that, pursuant to authority vested in the Board of Directors of the Company by Article IV of the Certificate of Incorporation of the Company, the following resolution was
adopted as of                      by the Board of Directors of the Company pursuant to Section 151 of the Delaware General Corporation Law:

  
 “RESOLVED that, pursuant to authority vested in the Board
of Directors of the Company by Article IV of the Company’s Certificate of Incorporation, out of the total authorized number of
                     shares of its preferred stock, par value $0.004 per share (“Preferred Stock”), there shall be designated a
series of                      shares which shall be issued in and constitute a single series to be known as “Series M Convertible
Preferred Stock” (hereinafter called the “Series M Preferred Stock”). The shares of Series M Preferred Stock have the voting powers, designations, preferences and other special rights, and qualifications, limitations and restrictions
thereof set forth below: 
  
 1. Certain Definitions.

  
 As used in this Certificate of Designations, Preferences and
Rights of Series M Convertible Preferred Stock of Velocity Express Corporation, the following terms shall have the respective meanings set forth below: 
  
 “Affiliate”, as applied to any Person, means any other Person directly or indirectly controlling, controlled by, or under common control
with, that Person. For the purposes of this definition, “control” (including, with correlative meanings, the terms “controlling”, “controlled by” and “under common control with”), as applied to any Person,
means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of that Person, whether through the ownership of voting securities or by contract or otherwise. 

 “Common Stock” means the common stock, $0.004 par value per share, of the Company,
including the stock into which the Series M Preferred Stock is convertible, and any securities into which the Common Stock may be reclassified. 
  
 “Excluded Stock” means (A) capital stock, Options (as defined in Section 4D(1)) or Convertible Securities (as defined in Section 4D(1))
issued to employees, consultants, officers or directors of the Company pursuant to any stock or option plan duly adopted by a majority of the non-employee members of the Board of Directors of the Company or a majority of the members of a committee
of non-employee directors established for such purpose, (B) shares of Common Stock issued upon the conversion or exercise of Options or Convertible Securities issued prior to the date hereof, provided that such securities have not been amended since
the date hereof, (C) securities issued pursuant to that certain Purchase Agreement dated December 21, 2004, among the Company and the Investors named therein (the “Purchase Agreement”) and securities issued upon the exercise or conversion
of those securities, (D) capital stock or Convertible Securities issued to a lender in connection with the provision of credit to the Company and (E) shares of Common Stock issued or issuable by reason of a dividend, stock split or other
distribution on shares of Common Stock (but only to the extent that such a dividend, split or distribution results in an adjustment in the Conversion Price pursuant to the other provisions of this Series M Preferred Stock). 
  
 “Person” shall be construed in the broadest sense and means
and includes any natural person, a partnership, a corporation, an association, a joint stock company, a limited liability company, a trust, a joint venture, an unincorporated organization and other entity or governmental or quasi-governmental
entity. 
  
 “Series M Stated Value” means
$                     [final conversion price of the Notes on the conversion date] (appropriately adjusted for any stock split, reverse stock
split, stock dividend or other reclassification or combination of the Series M Preferred Stock occurring after the date hereof). 
  
 “Subsidiary” means any corporation, association or other business entity (i) at least 50% of the outstanding voting securities of which
are at the time owned or controlled, directly or indirectly, by the Company; or (ii) with respect to which the Company possesses, directly or indirectly, the power to direct or cause the direction of the affairs or management of such person;

  
 2. Dividends. 
  
 (a) Each holder of Series M Preferred Stock, in preference and priority to
the holders of all other classes of stock, shall be entitled to receive, with respect to each share of Series M Preferred Stock then outstanding and held by such holder of Series M Preferred Stock, dividends, commencing from the date of issuance of
such share of Series M Preferred Stock, at the rate of six percent (6%) per annum of the Series M Stated Value (the “Series M Preferred Dividends”). The Series M Preferred Dividends shall be cumulative, whether or not earned or declared,
and shall be paid quarterly in arrears on the first day of March, June, September and December in each year. During the first two (2) years following the date of issuance, the Series M Preferred Dividends shall be paid by issuing each holder of
Series M Preferred Stock such number of shares of Series M Preferred Stock equal to the Series M Preferred Dividend divided by the Series M Stated Value 

  

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(“PIK Shares”). From and after the second anniversary of the date of issuance, the Company shall have the option to pay the Series M Preferred
Dividends in PIK Shares or in cash out of legally available funds therefor. Any election by the Company to pay dividends in shares of Series M Preferred Stock or cash shall be made uniformly with respect to all outstanding shares of Series M
Preferred Stock for a given dividend period. 
  
 (b) No dividends
shall be paid on any Common Stock of the Company or any other capital stock of the Company during any fiscal year of the Company until all outstanding Series M Preferred Dividends (with respect to the current fiscal year and all prior fiscal years)
shall have been paid or declared and set apart for payment to the holders of Series M Preferred Stock. 
  
 (c) In the event that the Company shall at any time pay a dividend on the Common Stock (other than a dividend payable solely in shares of Common Stock) or
any other class or series of capital stock of the Company, the Company shall, at the same time, pay to each holder of Series M Preferred Stock a dividend equal to the dividend that would have been payable to such holder if the shares of Series M
Preferred Stock held by such holder had been converted into Common Stock on the date of determination of holders of Common Stock entitled to receive such dividends. 
  
 3. Liquidation; Redemption. Upon any liquidation, dissolution or winding up of the Company, whether voluntary or
involuntary, the holders of the shares of Series M Preferred Stock shall be entitled, before any distributions shall be made to the holders of the Common Stock, or any other class or series of capital stock of the Company ranking junior to the
Series M Preferred Stock as to such distributions, to be paid an amount per share equal to the Series M Stated Value plus any accrued and unpaid Series M Preferred Dividends (the “Liquidation Preference”). If upon such liquidation,
dissolution or winding up of the Company, whether voluntary or involuntary, the assets to be distributed among the holders of the Series M Preferred Stock and any class or series of capital stock ranking on a parity with the Series M Preferred Stock
as to such distributions shall be insufficient to permit payment to the holders of the Series M Preferred Stock and any such class or series of capital stock of their respective liquidation amount, then the entire assets of the Company to be
distributed shall be distributed pro rata to the holders of Series M Preferred Stock and the holders of such class or series of capital stock ranking on a parity with the Series M Preferred Stock as to such distributions according to the
preferential amounts due thereon. Unless waived in writing by the holders of at least 62.5% of the Series M Preferred Stock then outstanding, voting together as one class, a consolidation or merger of the Company into or with any other entity or
entities, or the sale or transfer by the Company of all or substantially all of its assets, in each case under circumstances in which the holders of a majority in voting power of the outstanding capital stock of the Company, immediately prior to
such a merger, consolidation or sale, own less than a majority in voting power of the outstanding capital stock of the corporation or the surviving or resulting corporation or acquirer, as the case may be, immediately following such a merger,
consolidation or sale (each such transaction being hereinafter referred to as a “Corporate Transaction”) shall be deemed to be a liquidation within the meaning of this Section 3; provided, however, that the holder(s) of any share or
shares of Series M Preferred Stock shall have the right, at its option, upon consummation of a Corporate Transaction, to require the Company to redeem such holder(s) shares or shares of Series M Preferred Stock, for an amount equal to such
holder’s Liquidation Preference. 
  

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 4. Conversion. 
  
 4A. Right to Convert; Mandatory Conversion. 
  
 (a) Subject to the terms and conditions of this paragraph 4A, the holder of any share or shares of Series M
Preferred Stock shall have the right, at its option at any time, to convert any such shares of Series M Preferred Stock into such number of fully paid and nonassessable whole shares of Common Stock as is obtained by multiplying the number of shares
of Series M Preferred Stock so to be converted by the Liquidation Preference per share and dividing the result by the conversion price of
$                     [final conversion price of the Notes on the conversion date] per share or, if there has been an adjustment of the
conversion price, by the conversion price as last adjusted and in effect at the date any share or shares of Series M Preferred Stock are surrendered for conversion (such price, or such price as last adjusted, being referred to herein as the
“Conversion Price”). Such rights of conversion shall be exercised by the holder thereof by surrender of a certificate or certificates for the shares to be converted to the Company at its principal office (or such other office or agency of
the Company as the Company may designate by notice in writing to the holder or holders of the Series M Preferred Stock) at any time during its usual business hours on the date set forth in such notice, together with a properly completed notice of
conversion in the form attached to the Series M Preferred Stock certificate with a statement of the name or names (with address), subject to compliance with applicable laws to the extent such designation shall involve a transfer, in which the
certificate or certificates for shares of Common Stock, shall be issued. Such conversion shall be deemed to have been effected and the Conversion Price shall be determined as of the close of business on the date on which such written notice shall
have been received by the Company and the certificate or certificates for such shares shall have been surrendered as aforesaid. 
  
 (b) All issued and outstanding shares of Series M Preferred Stock shall be converted into fully paid and nonassessable whole shares of
Common Stock at the Conversion Price automatically and without any action on the part of the holders thereof upon the vote or written consent of the holders of at least 62.5% of the issued and outstanding shares of Series M Preferred Stock. The
Company shall provide prompt written notice to the holders of Series M Preferred Stock of any conversion effected pursuant to this subsection 4A(b) but in no event more than five days after the effective date of such conversion. From and after any
conversion effected pursuant to this subsection 4A(b), the holders of the Series M Preferred Stock shall have the right to receive shares of Common Stock in accordance with and upon compliance with the other provisions of subsections 4A, 4B and 4C
hereof 
  
 4B. Issuance of Certificates; Time
Conversion Effected. Promptly after the conversion of the Series M Preferred Stock and surrender of the certificate or certificates for the share or shares of the Series M Preferred Stock being converted, the Company shall issue and deliver, or
cause to be issued and delivered, to the holder, registered in such name or names as such holder may direct, subject to compliance with applicable laws to the extent 

  

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such designation shall involve a transfer, a certificate or certificates for the number of whole shares of Common Stock issuable upon the conversion of such
share or shares of Series M Preferred Stock. Upon the effective date of any such conversion, the rights of the holder of the shares of Series M Preferred Stock being converted shall cease, and the person or persons in whose name or names any
certificate or certificates for shares of Common Stock shall be issuable upon such conversion shall be deemed to have become the holder or holders of record of the shares represented thereby. 
  
 4C. Fractional Shares; Dividends; Partial Conversion.
No fractional shares shall be issued upon conversion of the Series M Preferred Stock into Common Stock, and the number of shares of Common Stock to be issued shall be rounded down to the nearest whole share. In case the number of shares of Series M
Preferred Stock represented by the certificate or certificates surrendered pursuant to subsection 4A(a) exceeds the number of shares converted, the Company shall upon such conversion, execute and deliver to the holder thereof at the expense of the
Company, a new certificate for the number of shares of Series M Preferred Stock represented by the certificate or certificates surrendered which are not to be converted. 
  
 4D. Adjustment of Conversion Price. If the Company shall issue or sell, or is, in accordance with
subsections 4D(1) through 4D(8) below, deemed to have issued or sold, any Additional Shares of Common Stock without consideration or for a consideration per share less than the Conversion Price in effect immediately prior to the time of such issue
or sale, then and in each such case (a “Trigger Issuance”) the then-existing Conversion Price, shall be reduced, as of the close of business on the effective date of the Trigger Issuance, to a price determined as follows:

  

			
	 Adjusted Conversion Price =
	 	 (A x B) + D

	 	 	 A+C

  
 where

  
 “A” equals the number of shares of
Common Stock outstanding, including Additional Shares of Common Stock (as defined below) deemed to be issued hereunder, immediately preceding such Trigger Issuance; 
  
 “B” equals the Conversion Price in effect immediately preceding such Trigger Issuance; 

 
 “C” equals the number of Additional Shares of
Common Stock issued or deemed issued hereunder as a result of the Trigger Issuance; and 
  
 “D” equals the aggregate consideration, if any, received or deemed to be received by the Company upon such Trigger Issuance;

  
 provided, however, that in no event shall the Conversion Price after giving
effect to such Trigger 

  

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Issuance be greater than the Conversion Price in effect prior to such Trigger Issuance. 
  
 For purposes of this subsection 4D, “Additional Shares of Common Stock” shall mean all shares of Common Stock
issued by the Company or deemed to be issued pursuant to this subsection 4D, other than Excluded Stock. 
  
 For purposes of this subsection 4D, the following paragraphs 4D(1) to 4D(8) shall also be applicable: 
  
 4D(1) Issuance of Rights or Options. In case at any
time the Company shall in any manner grant (directly and not by assumption in a merger or otherwise) any warrants or other rights to subscribe for or to purchase, or any options for the purchase of, Common Stock or any stock or security convertible
into or exchangeable for Common Stock (such warrants, rights or options being called “Options” and such convertible or exchangeable stock or securities being called “Convertible Securities”) whether or not such Options or the
right to convert or exchange any such Convertible Securities are immediately exercisable, and the price per share for which Common Stock is issuable upon the exercise of such Options or upon the conversion or exchange of such Convertible Securities
(determined by dividing (i) the sum (which sum shall constitute the applicable consideration) of (x) the total amount, if any, received or receivable by the Company as consideration for the granting of such Options, plus (y) the aggregate amount of
additional consideration payable to the Company upon the exercise of all such Options, plus (z), in the case of such Options which relate to Convertible Securities, the aggregate amount of additional consideration, if any, payable upon the issue or
sale of such Convertible Securities and upon the conversion or exchange thereof, by (ii) the total maximum number of shares of Common Stock issuable upon the exercise of such Options or upon the conversion or exchange of all such Convertible
Securities issuable upon the exercise of such Options) shall be less than the Conversion Price in effect immediately prior to the time of the granting of such Options, then the total number of shares of Common Stock issuable upon the exercise of
such Options or upon conversion or exchange of the total amount of such Convertible Securities issuable upon the exercise of such Options shall be deemed to have been issued for such price per share as of the date of granting of such Options or the
issuance of such Convertible Securities and thereafter shall be deemed to be outstanding for purposes of adjusting the Conversion Price. Except as otherwise provided in subsection 4D(3), no adjustment of the Conversion Price shall be made upon the
actual issue of such Common Stock or of such Convertible Securities upon exercise of such Options or upon the actual issue of such Common Stock upon conversion or exchange of such Convertible Securities. 
  
 4D(2) Issuance of Convertible Securities. In case the
Company shall in any manner issue (directly and not by assumption in a merger or otherwise) or sell any Convertible Securities, whether or not the rights to exchange or convert any such Convertible Securities are immediately exercisable, and the
price per share for which Common Stock is issuable upon such conversion or exchange (determined by dividing (i) the sum (which sum shall constitute the applicable consideration) of (x) the total amount received or receivable by the Company as
consideration for the issue or sale of such Convertible Securities, plus (y) the 

  

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aggregate amount of additional consideration, if any, payable to the Company upon the conversion or exchange thereof, by (ii) the total number of shares of
Common Stock issuable upon the conversion or exchange of all such Convertible Securities) shall be less than the Conversion Price in effect immediately prior to the time of such issue or sale, then the total maximum number of shares of Common Stock
issuable upon conversion or exchange of all such Convertible Securities shall be deemed to have been issued for such price per share as of the date of the issue or sale of such Convertible Securities and thereafter shall be deemed to be outstanding
for purposes of adjusting the Conversion Price, provided that (a) except as otherwise provided in subsection 4D(3), no adjustment of the Conversion Price shall be made upon the actual issuance of such Common Stock upon conversion or exchange of such
Convertible Securities and (b) no further adjustment of the Conversion Price shall be made by reason of the issue or sale of Convertible Securities upon exercise of any Options to purchase any such Convertible Securities for which adjustments of the
Conversion Price have been made pursuant to the other provisions of subsection 4D. 
  
 4D(3) Change in Option Price or Conversion Rate. Upon the happening of any of the following events, namely, if the purchase price
provided for in any Option referred to in subsection 4D(l) hereof, the additional consideration, if any, payable upon the conversion or exchange of any Convertible Securities referred to in subsections 4D(l) or 4D(2), or the rate at which
Convertible Securities referred to in subsections 4D(l) or 4D(2) are convertible into or exchangeable for Common Stock shall change at any time (including, but not limited to, changes under or by reason of provisions designed to protect against
dilution), the Conversion Price in effect at the time of such event shall forthwith be readjusted to the Conversion Price which would have been in effect at such time had such Options or Convertible Securities still outstanding provided for such
changed purchase price, additional consideration or conversion rate, as the case may be, at the time initially granted, issued or sold. On the termination of any Option for which any adjustment was made pursuant to this subsection 4(D) or any right
to convert or exchange Convertible Securities for which any adjustment was made pursuant to this subsection 4(D) (including without limitation upon the redemption or purchase for consideration of such Convertible Securities by the Company), the
Conversion Price then in effect hereunder shall forthwith be changed to the Conversion Price which would have been in effect at the time of such termination had such Option or Convertible Securities, to the extent outstanding immediately prior to
such termination, never been issued. 
  
 4D(4)
Stock Dividends. Subject to the provisions of this subsection 4D, in case the Company shall declare a dividend or make any other distribution upon any stock of the Company (other than the Common Stock) payable in Common Stock, Options or
Convertible Securities, then any Common Stock, Options or Convertible Securities, as the case may be, issuable in payment of such dividend or distribution shall be deemed to have been issued or sold without consideration; provided, however, that the
provisions of this subsection 4D(4) shall not apply to the issuance of PIK Shares in accordance with the terms hereof. 
  
 4D(5) Subdivision or Combination of Stock. In case the Company shall at any time subdivide its outstanding shares of Common Stock
into a greater number of shares or shall 

  

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declare or pay a dividend on its outstanding shares of Common Stock payable in shares of Common Stock, the Conversion Price in effect immediately prior to
such subdivision shall be proportionately reduced, and conversely, in case the outstanding shares of Common Stock of the Company shall be combined into a smaller number of shares, the Conversion Price in effect immediately prior to such combination
shall be proportionately increased. 
  
 4D(6)
Consideration for Stock. In case any shares of Common Stock, Options or Convertible Securities shall be issued or sold for cash, the consideration received therefor shall be deemed to be the net amount received by the Company therefor, after
deduction therefrom of any expenses incurred or any underwriting commissions or concessions paid or allowed by the Company in connection therewith. In case any shares of Common Stock, Options or Convertible Securities shall be issued or sold for a
consideration other than cash, the amount of the consideration other than cash received by the Company shall be deemed to be the fair value of such consideration as determined in good faith by the Board of Directors of the Company, after deduction
of any expenses incurred or any underwriting commissions or concessions paid or allowed by the Company in connection therewith. In case any Options shall be issued in connection with the issue and sale of other securities of the Company, together
comprising one integral transaction in which no specific consideration is allocated to such Options by the parties thereto, such Options shall be deemed to have been issued for such consideration as determined in good faith by the Board of Directors
of the Company. If Common Stock, Options or Convertible Securities shall be issued or sold by the Company and, in connection therewith, other Options or Convertible Securities (the “Additional Rights”) are issued, then the consideration
received or deemed to be received by the Company shall be reduced by the fair market value of the Additional Rights (as determined using the Black-Scholes option pricing model or another method mutually agreed to by the Company and the holder). The
Board of Directors of the Company shall respond promptly, in writing, to an inquiry by the holder as to the fair market value of the Additional Rights. In the event that the Board of Directors of the Company and the holder are unable to agree upon
the fair market value of the Additional Rights, the Company and the holder shall jointly select an appraiser, who is experienced in such matters. The decision of such appraiser shall be final and conclusive, and the cost of such appraiser shall be
borne evenly by the Company and the holder. 
  
 4D(7) Record Date. In case the Company shall take a record of the holders of its Common Stock for the purpose of entitling them (i) to receive a dividend or other distribution payable in Common Stock, Options or Convertible
Securities or (ii) to subscribe for or purchase Common Stock, Options or Convertible Securities, then such record date shall be deemed to be the date of the issue or sale of the shares of Common Stock deemed to have been issued or sold upon the
declaration of such dividend or the making of such other distribution or the date of the granting of such right of subscription or purchase, as the case may be. 
  
 4D(8) Treasury Shares. The number of shares of Common Stock outstanding at any given time shall not
include shares owned or held by or for the account of the Company or any of its wholly-owned subsidiaries, and the disposition of any such shares (other than the 

  

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cancellation or retirement thereof) shall be considered an issue or sale of Common Stock for the purpose of this Section 4D. 
  
 4E Stock Splits and Dividends. If the Company shall,
at any time or from time to time while the Series M Preferred Stock is outstanding, pay a dividend or make a distribution on its Common Stock in shares of Common Stock, subdivide its outstanding shares of Common Stock into a greater number of shares
or combine its outstanding shares of Common Stock into a smaller number of shares or issue by reclassification of its outstanding shares of Common Stock any shares of its capital stock (including any such reclassification in connection with a
consolidation or merger in which the Company is the continuing corporation), then the Conversion Price in effect immediately prior to the date upon which such change shall become effective shall be adjusted by the Company so that the holder
thereafter converting its shares of Series M Preferred Stock shall be entitled to receive the number of shares of Common Stock or other capital stock which the such holder would have received if the shares of Series M Preferred Stock had been
converted immediately prior to such event. Such adjustments shall be made successively whenever any event listed above shall occur. 
  
 4F. Reorganization or Reclassification. If any capital reorganization or reclassification of the capital stock of the Company shall
be effected in such a way (including, without limitation, by way of consolidation or merger) that holders of Common Stock but not holders of Series M Preferred Stock shall be entitled to receive stock, securities or assets with respect to or in
exchange for Common Stock then, as a condition of such reorganization or reclassification, lawful and adequate provision shall be made whereby each holder of a share or shares of Series M Preferred Stock shall thereafter have the right to receive,
upon the basis and upon the terms and conditions specified herein and in lieu of the shares of Common Stock of the Company immediately theretofore receivable upon the conversion of such share or shares of the Series M Preferred Stock, such shares of
stock, securities or assets as may be issued or payable with respect to or in exchange for a number of outstanding shares of Common Stock equal to the number of shares of such stock immediately theretofore so receivable had such reorganization or
reclassification not taken place and in any such case appropriate provision shall be made with respect to the rights and interests of such holder to the end that the provisions hereof (including without limitation provisions for adjustments of the
Conversion Price) shall thereafter be applicable, as nearly as may be, in relation to any shares of stock, securities or assets thereafter deliverable upon the exercise of such conversion rights (including an immediate adjustment, by reason of such
reorganization or reclassification, of the Conversion Price to the value for the Common Stock reflected by the terms of such reorganization or reclassification if the value so reflected is less than the Conversion Price in effect immediately prior
to such reorganization or reclassification). In the event of a merger or consolidation of the Company as a result of which a greater or lesser number of shares of common stock of the surviving corporation are issuable to holders of the Common Stock
of the Company outstanding immediately prior to such merger or consolidation, the Conversion Price in effect immediately prior to such merger or consolidation shall be adjusted in the same manner as though there were a subdivision or combination of
the outstanding shares of Common Stock of the Company. 
  

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 4G. Distributions. In case the Company shall fix a payment date for the making of
a distribution to all holders of Common Stock (including any such distribution made in connection with a consolidation or merger in which the Company is the continuing corporation) of evidences of indebtedness or assets (other than cash dividends or
cash distributions payable out of consolidated earnings or earned surplus or dividends or distributions referred to in Section 4E), or subscription rights or warrants, the Conversion Price to be in effect after such payment date shall be determined
by multiplying the Conversion Price in effect immediately prior to such payment date by a fraction, the numerator of which shall be the total number of shares of Common Stock outstanding multiplied by the Market Price (as defined below) per share of
Common Stock immediately prior to such payment date, less the fair market value (as determined by the Company’s Board of Directors in good faith) of said assets or evidences of indebtedness so distributed, or of such subscription rights or
warrants, and the denominator of which shall be the total number of shares of Common Stock outstanding multiplied by such Market Price per share of Common Stock immediately prior to such payment date. “Market Price” as of a particular date
(the “Valuation Date”) shall mean the following: (a) if the Common Stock is then listed on a national stock exchange, the closing sale price of one share of Common Stock on such exchange on the last trading day prior to the Valuation Date;
(b) if the Common Stock is then quoted on The Nasdaq Stock Market, Inc. (“Nasdaq”), the National Association of Securities Dealers, Inc. OTC Bulletin Board (the “Bulletin Board”) or such similar exchange or association, the
closing sale price of one share of Common Stock on Nasdaq, the Bulletin Board or such other exchange or association on the last trading day prior to the Valuation Date or, if no such closing sale price is available, the average of the high bid and
the low asked price quoted thereon on the last trading day prior to the Valuation Date; or (c) if the Common Stock is not then listed on a national stock exchange or quoted on Nasdaq, the Bulletin Board or such other exchange or association, the
fair market value of one share of Common Stock as of the Valuation Date, shall be determined in good faith by the Board of Directors of the Company and the holders of at least 62.5% of the outstanding Series M Preferred Stock. If the Common Stock is
not then listed on a national securities exchange, the Bulletin Board or such other exchange or association, the Board of Directors of the Company shall respond promptly, in writing, to an inquiry by a holder of Series M Preferred Stock prior to the
exercise hereunder as to the fair market value of a share of Common Stock as determined by the Board of Directors of the Company. In the event that the Board of Directors of the Company and the holders of at least 62.5% of the outstanding Series M
Preferred Stock are unable to agree upon the fair market value in respect of subpart (c) hereof, the Company and the holders of at least 62.5% of the outstanding Series M Preferred Stock shall jointly select an appraiser, who is experienced in such
matters. The decision of such appraiser shall be final and conclusive, and the cost of such appraiser shall be borne equally by the Company and such holders. Such adjustment shall be made successively whenever such a payment date is fixed.

  
 4H. Effective Date of Adjustment. An
adjustment to the Conversion Price shall become effective immediately after the payment date in the case of each dividend or distribution and immediately after the effective date of each other event which requires an adjustment. 
  

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 4I. Subsequent Adjustments. In the event that, as a result of an adjustment made
pursuant to this Section 4, holders of Series M Preferred Stock shall become entitled to receive any shares of capital stock of the Company other than shares of Common Stock, the number of such other shares so receivable upon the conversion of the
Series M Preferred Stock shall be subject thereafter to adjustment from time to time in a manner and on terms as nearly equivalent as practicable to the provisions with respect to the Conversion Shares contained herein. 
  
 4J. Notice of Adjustment. Upon any adjustment of the
Conversion Price, then, and in each such case the Company shall give written notice thereof by first class mail, postage prepaid, addressed to each holder of shares of Series M Preferred Stock at the address of such holder as shown on the books of
the Company, which notice shall state the Conversion Price resulting from such adjustment, setting forth in reasonable detail the method of calculation and the facts upon which such calculation is based. 
  
 4K. Other Notices. In case at any time: 

 
 (1) the Company shall declare any dividend upon its
Common Stock payable in cash or stock or make any other distribution to the holders of its Common Stock; 
  
 (2) the Company shall offer for subscription pro rata to the holders of its Common Stock any additional shares of such stock
of any class or other rights; 
  
 (3) there shall
be any capital reorganization or reclassification of the capital stock of the Company, or a consolidation or merger of the Company with, or a sale of all or substantially all its assets to, another corporation; or 
  
 (4) there shall be a voluntary or involuntary dissolution,
liquidation or winding up of the Company; 
  
 then, in any one or
more of said cases, the Company shall give, by first class mail, postage prepaid, addressed to each holder of any shares of Series M Preferred Stock at the address of such holder as shown on the books of the Company, (a) at least 15 days prior
written notice of the date on which the books of the Company shall close or a record shall be taken for such dividend, distribution or subscription rights or for determining rights to vote in respect of any such reorganization, reclassification,
consolidation, merger, sale, dissolution, liquidation or winding up, and (b) in the case of any such reorganization, reclassification, consolidation, merger, sale, dissolution, liquidation or winding up, at least 15 days prior written notice of the
date when the same shall take place. Such notice in accordance with the foregoing clause (a) shall also specify, in the case of any such dividend, distribution or subscription rights, the date on which the holders of Common Stock shall be entitled
thereto, and such notice in accordance with the foregoing clause (b) shall also specify the date on which the holders of Common Stock shall be entitled to exchange their Common Stock for securities or other 

  

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property deliverable upon such reorganization, reclassification, consolidation, merger, sale, dissolution, liquidation or winding up, as the case may be.

  
 4L. Stock to be Reserved. 

 
 (1) The Company will at all times reserve and keep
available out of its authorized but unissued Common Stock solely for the purpose of issuance upon the conversion of the Series M Preferred Stock as herein provided, such number of shares of Common Stock as shall then be issuable upon the conversion
of all outstanding shares of Series M Preferred Stock. All shares of Common Stock which shall be so issued shall be duly and validly issued and fully paid and nonassessable and free from all liens, duties and charges arising out of or by reason of
the issue thereof (including, without limitation, in respect of taxes) and, without limiting the generality of the foregoing, the Company covenants that it will from time to time take all such action as may be requisite to assure that the par value
per share of the Common Stock is at all times equal to or less than the effective Conversion Price. The Company will take all such action within its control as may be necessary on its part to assure that all such shares of Common Stock may be so
issued without violation of any applicable law or regulation, or of any requirements of any national securities exchange upon which the Common Stock of the Company may be listed. The Company will not take any action which results in any adjustment
of the Conversion Price if after such action the total number of shares of Common Stock issued and outstanding and thereafter issuable upon exercise of all options and conversion of Convertible Securities, including upon conversion of the Series M
Preferred Stock, would exceed the total number of shares of such class of Common Stock then authorized by the Company’s Certificate of Incorporation. 
  
 (2) The Company will at all times reserve and keep available out of its authorized Series M Preferred Stock such number of shares of
Series M Preferred Stock as is equal to the number of shares of Series M Preferred Stock then outstanding. All shares of Series M Preferred Stock which shall be so issued shall be duly and validly issued and fully paid and nonassessable and free
from all liens, duties and charges arising out of or by reason of the issue thereof (including, without limitation, in respect of taxes). 
  
 4M. No Reissuance of Series M Preferred Stock. Shares of Series M Preferred Stock that are converted into shares of Common Stock as
provided herein shall be retired and may not be reissued as Series M Preferred Stock but may be reissued as all or part of another series of Preferred Stock. 
  

4N. Issue Tax. The issuance of certificates for shares of Common Stock upon conversion of the Series M Preferred Stock shall be
made without charge to the holders thereof for any issuance tax, stamp tax, transfer tax, duty or charge in respect thereof, provided that the Company shall not be required to pay any tax, duty or charge which may be payable in respect of any
transfer involved in the issuance and delivery of any certificate in a name other than that of the holder of the Series M Preferred Stock which is being converted. 
  

 -12- 

 4O. Closing of Books. The Company will at no time close its transfer books against
the transfer of any Series M Preferred Stock or of any shares of Common Stock issued or issuable upon the conversion of any shares of Series M Preferred Stock in any manner which interferes with the timely conversion of such Series M Preferred
Stock; provided, however, nothing herein shall be construed to prevent the Company from setting record dates for the holders of its securities. 
  
 5. Voting - Series M Preferred Stock. 
  
 (a) So long as shares of Series M Preferred Stock are outstanding, the Company shall give the holders of the Series M Preferred Stock written notice of
each meeting of the Company’s Board of Directors and each committee thereof at least at the same time and in the same manner as notice is given to the directors and the holders of the Series M Preferred Stock shall have the right to designate
(in such manner as they shall determine in their sole discretion) three representatives who shall have the right to attend as observers all meetings of the Company’s Board of Directors and all committees thereof; provided that in the case of
telephonic meetings conducted in accordance with the Company’s bylaws and applicable law, the holders’ representatives shall be given the opportunity to listen to such telephonic meetings. The holders’ representatives shall be
entitled to receive all written materials and other information (including without limitation copies of meeting minutes) given to directors in connection with such meetings at the same time such materials and information are given to the directors.
If the Company proposes to take any action by written consent in lieu of a meeting of its Board of Directors or of any committee thereof, the Company shall give written notice thereof to the holders’ representative and each of the
Company’s directors prior to the effective date of such consent describing in reasonable detail the nature and substance of such action. The Company shall pay the reasonable out-of-pocket expenses of the holders’ representatives incurred
in connection with attending such board and committee meetings. 
  
 (b) So long as shares of Series M Preferred Stock are outstanding, the holders of Series M Preferred Stock, voting as a separate class, shall have the right to elect one member of Company’s Board of Directors (the “Series M
Director”). The Company shall pay the reasonable out-of-pocket expenses of the Series M Director incurred in connection with attending meetings of the Company’s Board of Directors and any committees thereof on which such Series M Director
serves. During the term of any Series M Director elected by the holders of Series M Preferred Stock in accordance with this subsection 5(b), the number of observers which such holders have the right to designate pursuant to subsection 5(a) shall be
reduced to two. 
  
 (c) In addition to any class voting rights
provided by law and this Certificate of Designation, the holders of Series M Preferred Stock shall have the right to vote together with the holders of Common Stock as a single class on any matter on which the holders of Common Stock are entitled to
vote (including the election of directors other than the Series M Director). With respect to the voting rights of the holders of the Series M Preferred Stock pursuant to the preceding sentence, each holder of Series M Preferred Stock shall be
entitled to one vote for each share of Common Stock that would be issuable to such holder upon the conversion of all the shares of Series M Preferred Stock held by such holder on the record date for the determination of shareholders entitled to
vote. 
  

 -13- 

 6. Certain Restrictions. In addition to any other vote of the holders of Series M Preferred Stock
required by law or by the Certificate of Incorporation, without the prior consent of the holders of at least 62.5% of the outstanding Series M Preferred Stock, given in person or by proxy, either in writing or at a special meeting called for that
purpose, at which meeting the holders of the shares of such Series M Preferred Stock shall vote together as a class, the Company will not: 
  
 (a) authorize, create, designate, establish or issue (whether by merger or otherwise) (i) an increased number of shares of Series M
Preferred Stock (other than shares of Series M Preferred Stock payable as payment-in-kind dividends on outstanding shares of Series M Preferred Stock), or (ii) any other class or series of capital stock ranking senior to or on parity with the Series
M Preferred Stock as to dividends or upon liquidation or reclassify any shares of Common Stock into shares having any preference or priority as to dividends or upon liquidation superior to or on parity with any such preference or priority of Series
M Preferred Stock; 
  
 (b) adopt a plan for the
liquidation, dissolution or winding up of the affairs of the Company or any recapitalization plan (whether occurring by merger, consolidation or otherwise), file any petition seeking protection under any federal or state bankruptcy or insolvency law
or make a general assignment for the benefit of creditors unless the holders of the Series M Preferred Stock will receive an amount in cash at least equal to the Liquidation Preference in such transaction; 
  
 (c) merge into or consolidate with engage in any share
exchange with any other Person or permit any Person to merge into or consolidate with or engage in any share exchange the Company if immediately thereafter, less than 50% of the voting power of the surviving entity is retained by the holders of
voting power of the Company immediately prior thereto unless the holders of the Series M Preferred Stock will receive an amount in cash at least equal to the Liquidation Preference in such transaction; 
  
 (d) adopt any stock option, stock compensation or stock
purchase plan (other than the Stock Option Plan (as defined in the Purchase Agreement)), maintain any stock option, stock compensation or stock purchase plan which contains any “evergreen” or formula provisions increasing the number of
shares of Common Stock available for grant thereunder (other than customary anti-dilution adjustments) or amend any existing stock option, stock compensation or stock purchase plan so as to increase the number of shares of Common Stock covered
thereby; 
  
 (e) enter into any transaction with
any Affiliate or stockholder of the Company; 
  
 (f) enter into or consummate the sale, lease, transfer, assignment or other disposition of all or any substantial part of its assets, whether in a single transaction or series of related transactions, to any Person unless the holders of the
Series M Preferred Stock will receive an amount in cash at least equal to the Liquidation Preference in such transaction; 
  

 -14- 

 (g) amend, alter or repeal, whether by merger, consolidation or otherwise, the
Certificate of Incorporation or By-laws of the Company or the Resolutions contained in this Certificate of Designations of the Series M Preferred Stock and the powers, preferences, privileges, relative, participating, optional and other special
rights and qualifications, limitations and restrictions thereof, which would adversely affect any right, preference, privilege or voting power of the Series M Preferred Stock, or which would increase or decrease the amount of authorized shares of
the Series M Preferred Stock or of any other series of preferred stock ranking senior to the Series M Preferred Stock, with respect to the payment of dividends (whether or not such series of preferred stock is cumulative or noncumulative as to
payment of dividends) or upon liquidation 
  
 (h)
directly or indirectly, declare or pay any dividend (other than dividends permitted pursuant to Section 2 and dividends payable in shares of Common Stock but only to the extent that such stock dividend results in an adjustment of the Conversion
Price pursuant to Section 4(D)(4)) or directly or indirectly purchase, redeem, repurchase or otherwise acquire or permit any Subsidiary to redeem, purchase, repurchase or otherwise acquire (or make any payment to a sinking fund for such redemption,
purchase, repurchase or other acquisition) any share of Common Stock or any other class or series of the Company’s capital stock (except for shares of Common Stock repurchased from current of former employees, consultants, or directors upon
termination of service in accordance with plans approved by the Company board of directors) whether in cash, securities or property or in obligations of the Company or any Subsidiary; 
  
 (i) materially change the nature or scope of the business of the Company or enter into any new line of
business; 
  
 (j) consummate or agree to make any
sale, transfer, assignment, pledge, lease, license or similar transaction by which the Company grants any rights to any of the Company’s intellectual property or technology other than non-exclusive licenses granted by the Company to customers
in connection with the sale of the Company’s products in the ordinary course of business consistent with past practices; 
  
 (k) increase or decrease the number of directors comprising the Company’s Board of Directors (including the Series M Director); or

  
 (l) agree to do any of the foregoing.

  
 7. No Waiver. Except as otherwise modified or provided
for herein, the holders of Series M Preferred Stock shall also be entitled to, and shall not be deemed to have waived, any other applicable rights granted to such holders under the Delaware General Corporation Law. 
  
 8. No Impairment. The Company will not, through any reorganization,
transfer of assets, merger, dissolution, issue or sale of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms to be observed or performed hereunder 

  

 -15- 

 
by the Company but will at all time in good faith assist in the carrying out of all the provisions of this Article IV and in the taking of all such action as
may be necessary or appropriate in order to protect the conversion rights and liquidation preferences granted hereunder of the holders of the Series M Preferred Stock against impairment.” 
  
 9. Amendment; Waiver. Any term of the Series M Preferred Stock may be
amended or waived (including the adjustment provisions included in Section 4(D) hereof) upon the written consent of the Company and the holders of at least 62.5% of the Series M Preferred Stock then outstanding; provided, however that
the number of Conversion Shares issuable hereunder and the Conversion Price may not be amended, and the right to convert the Series M Preferred Stock may not be altered or waived, without the written consent of the holders of all of the Series M
Preferred Stock then outstanding. 
  
 10. Action By
Holders. Any action or consent to be taken or given by the holders of the Series M Preferred Stock may be given either at a meeting of the holders of the Series M Preferred Stock called and held for such purpose or by written consent.

  
 [Execution Page Follows] 
  

 -16- 

 IN WITNESS WHEREOF, the undersigned has executed Certificate of Designations, Preferences and Rights this
         day of                     , 200  . 
  

			
	 VELOCITY EXPRESS CORPORATION

		
	 By:
	 	 
	 	 	 Name:

	 	 	 Title:

  

 -17-Registration Rights Agreement dated December 21, 2004

  
 Exhibit 10.7

  
 REGISTRATION RIGHTS AGREEMENT 
  
 This Registration Rights Agreement (the “Agreement”) is made and
entered into as of this 21st day of December, 2004 by and among Velocity Express Corporation, a Delaware corporation
(the “Company”), and the “Investors” named in that certain Purchase Agreement by and among the Company and the Investors (the “Purchase Agreement”). 
  
 The parties hereby agree as follows: 
  
 1. Certain Definitions. 
  
 As used in this Agreement, the following terms shall have the following meanings: 
  
 “Affiliate” means, with respect to any person, any other person which directly or indirectly controls, is
controlled by, or is under common control with, such person. 
  
 “Business Day” means a day, other than a Saturday or Sunday, on which banks in New York City are open for the general transaction of business. 
  
 “Common Stock” shall mean the Company’s common stock, par value $0.004 per share, and any securities
into which such shares may hereinafter be reclassified. 
  
 “Conversion Shares” means the shares of Common Stock issuable upon conversion of the Shares and the PIK Shares. 
  
 “Investors” shall mean the Investors identified in the Purchase Agreement and any Affiliate or permitted transferee of any Investor who
is a subsequent holder of any Registrable Securities. 
  
 “PIK Shares” means shares of Preferred Stock issued as pay-in-kind dividends on the Shares or any previously issued PIK Shares. 
  
 “Prospectus” shall mean the prospectus included in any Registration Statement, as amended or supplemented by any prospectus supplement,
with respect to the terms of the offering of any portion of the Registrable Securities covered by such Registration Statement and by all other amendments and supplements to the prospectus, including post-effective amendments and all material
incorporated by reference in such prospectus. 
  
 “Register,” “registered” and “registration” refer to a registration made by preparing and filing a Registration Statement or similar document in compliance with the 1933 Act (as defined
below), and the declaration or ordering of effectiveness of such Registration Statement or document. 
  
 “Registrable Securities” shall mean (i) the Conversion Shares and (ii) any other securities issued or issuable with respect to or in
exchange for Registrable Securities; provided, that, a security shall cease to be a Registrable Security upon (A) sale pursuant to a Registration Statement or Rule 144 under the 1933 Act, or (B) such security becoming eligible for sale by the
Investors pursuant to Rule 144(k). 
  
 “Registration
Statement” shall mean any registration statement of the Company filed under the 1933 Act that covers the resale of any of the Registrable Securities pursuant to the provisions of this Agreement, amendments and supplements to such
Registration Statement, 

  

 
including post-effective amendments, all exhibits and all material incorporated by reference in such Registration Statement. 
  
 “Required Investors” means the Investors holding a majority
of the Registrable Securities. 
  
 “SEC” means
the U.S. Securities and Exchange Commission. 
  
 “Shares” means the shares of Preferred Stock issued pursuant to the Purchase Agreement. 
  
 “1933 Act” means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder. 
  
 “1934 Act” means the Securities Exchange Act of 1934, as
amended, and the rules and regulations promulgated thereunder. 
  
 2. Registration. 
  
 (a)
Registration Statements. 
  
 (i) Promptly
following the closing of the purchase and sale of the securities contemplated by the Purchase Agreement (the “Closing Date”) but no later than sixty (60) days after the Stockholders Meeting Deadline (as such term is defined in the Purchase
Agreement) (the “Filing Deadline”), the Company shall prepare and file with the SEC one Registration Statement on Form S-1 (or, if Form S-1 is not then available to the Company, on such form of registration statement as is then available
to effect a registration for resale of the Registrable Securities, subject to the Required Investors’ consent), covering the resale of the Registrable Securities in an amount at least equal to the number of Conversion Shares. Such Registration
Statement shall include the plan of distribution attached hereto as Exhibit A. Such Registration Statement also shall cover, to the extent allowable under the 1933 Act and the rules promulgated thereunder (including Rule 416), such
indeterminate number of additional shares of Common Stock resulting from stock splits, stock dividends or similar transactions with respect to the Registrable Securities. The Registration Statement (and each amendment or supplement thereto, and each
request for acceleration of effectiveness thereof) shall be provided in accordance with Section 3(c) to the Investors and their counsel prior to its filing or other submission. If a Registration Statement covering the Registrable Securities is not
filed with the SEC on or prior to the Filing Deadline, the Company will make pro rata payments to each Investor, as liquidated damages and not as a penalty, in an amount equal to 1.5% of the aggregate amount invested by such Investor for each 30-day
period or pro rata for any portion thereof following the Filing Deadline for which no Registration Statement is filed with respect to the Registrable Securities. Such payments shall be in partial compensation to the Investors, and shall not
constitute the Investors’ exclusive remedy for such events. Such payments shall be made to each Investor in cash. 
  
 (ii) Additional Registrable Securities. Upon the written demand of any Investor and upon any change in the Conversion Price (as
defined in the Certificate of Designations, Preferences and Rights of Series M Preferred Stock filed with the Secretary of State of Delaware) such that additional shares of Common Stock become issuable upon the 

  

 -2- 

 
conversion of the Shares or the PIK Shares, the Company shall prepare and file with the SEC one or more Registration Statements on Form S-1 or amend the
Registration Statement filed pursuant to clause (i) above, if such Registration Statement has not previously been declared effective (or, if Form S-1 is not then available to the Company, on such form of registration statement as is then available
to effect a registration for resale of such additional shares of Common Stock (the “Additional Shares”), subject to the Required Investors’ consent) covering the resale of the Additional Shares, but only to the extent the Additional
Shares are not at the time covered by an effective Registration Statement. Such Registration Statement also shall cover, to the extent allowable under the 1933 Act and the rules promulgated thereunder (including Rule 416), such indeterminate number
of additional shares of Common Stock resulting from stock splits, stock dividends or similar transactions with respect to the Additional Shares. The Registration Statement (and each amendment or supplement thereto, and each request for acceleration
of effectiveness thereof) shall be provided in accordance with Section 3(c) to the Investors and their counsel prior to its filing or other submission. If a Registration Statement covering the Additional Shares is required to be filed under this
Section 2(a)(ii) and is not filed with the SEC within ten (10) Business Days of the request of any Investor or upon the occurrence of any of the events specified in this Section 2(a)(ii), the Company will make pro rata payments to each Investor, as
liquidated damages and not as a penalty, in an amount equal to 1.5% of the aggregate amount invested by such Investor for each 30-day period or pro rata for any portion thereof following the date by which such Registration Statement should have been
filed for which no Registration Statement is filed with respect to the Additional Shares. Such payments shall be in partial compensation to the Investors, and shall not constitute the Investors’ exclusive remedy for such events. Such payments
shall be made to each Investor in cash. 
  
 (iii)
Promptly following the date (the “Qualification Date”) upon which the Company becomes eligible to use a registration statement on Form S-3 to register the Registrable Securities or Additional Shares, as applicable, for resale, but in no
event more than ten (10) Business Days after the Qualification Date (the “Qualification Deadline”), the Company shall file a registration statement on Form S-3 covering the Registrable Securities or Additional Shares, as applicable (or a
post-effective amendment on Form S-3 to the registration statement on Form S-1) (a “Shelf Registration Statement”) and shall use commercially reasonable efforts to cause such Shelf Registration Statement to be declared effective as
promptly as practicable thereafter. If a Shelf Registration Statement covering the Registrable Securities is not filed with the SEC on or prior to the Qualification Deadline, the Company will make pro rata payments to each Investor, as liquidated
damages and not as a penalty, in an amount equal to 1.5% of the aggregate amount invested by such Investor for each 30-day period or pro rata for any portion thereof following the Qualification Deadline for which no such Shelf Registration Statement
is filed with respect to the Registrable Securities or Additional Shares, as applicable. Such payments shall be in partial compensation to the Investors, and shall not constitute the Investors’ exclusive remedy for such events. Such payments
shall be made to each Investor in cash. 
  
 (b)
Expenses. The Company will pay all expenses associated with each registration, including filing and printing fees, the Company’s counsel and accounting fees and expenses, costs associated with clearing the Registrable Securities for sale
under applicable state securities laws, listing fees, fees and expenses of one counsel to the Investors and the Investors’ reasonable expenses in connection with the registration, but excluding discounts, 

  

 -3- 

 
commissions, fees of underwriters, selling brokers, dealer managers or similar securities industry professionals with respect to the Registrable Securities
being sold. 
  
 (c) Effectiveness.

  
 (i) The Company shall use commercially
reasonable efforts to have the Registration Statement declared effective as soon as practicable. The Company shall notify the Investors by facsimile or e-mail as promptly as practicable, and in any event, within twenty-four (24) hours, after any
Registration Statement is declared effective and shall simultaneously provide the Investors with copies of any related Prospectus to be used in connection with the sale or other disposition of the securities covered thereby. If (A)(x) a Registration
Statement covering the Registrable Securities is not declared effective by the SEC within 180 days after the earlier of the Filing Deadline or the date on which such Registration Statement was filed with the SEC, (y) a Registration Statement
covering Additional Shares is not declared effective by the SEC within ninety (90) days following the time such Registration Statement was required to be filed pursuant to Section 2(a)(ii) or (z) a Shelf Registration Statement is not declared
effective by the SEC within 90 days after the Qualification Deadline, or (B) after a Registration Statement has been declared effective by the SEC, sales cannot be made pursuant to such Registration Statement for any reason (including without
limitation by reason of a stop order, or the Company’s failure to update the Registration Statement), but excluding the inability of any Investor to sell the Registrable Securities covered thereby due to market conditions and except as excused
pursuant to subparagraph (ii) below, then the Company will make pro rata payments to each Investor, as liquidated damages and not as a penalty, in an amount equal to 1.5% of the aggregate amount invested by such Investor for each 30-day period or
pro rata for any portion thereof following the date by which such Registration Statement should have been effective (the “Blackout Period”). Such payments shall be in partial compensation to the Investors, and shall not constitute the
Investors’ exclusive remedy for such events. The amounts payable as liquidated damages pursuant to this paragraph shall be paid monthly within three (3) Business Days of the last day of each month following the commencement of the Blackout
Period until the termination of the Blackout Period. Such payments shall be made to each Investor in cash. 
  
 (ii) For not more than twenty (20) consecutive days or for a total of not more than forty-five (45) days in any twelve (12) month period,
the Company may delay the disclosure of material non-public information concerning the Company, by suspending the use of any Prospectus included in any registration contemplated by this Section containing such information, the disclosure of which at
the time is not, in the good faith opinion of the Company, in the best interests of the Company (an “Allowed Delay”); provided, that the Company shall promptly (a) notify the Investors in writing of the existence of (but in no event,
without the prior written consent of an Investor, shall the Company disclose to such Investor any of the facts or circumstances regarding) material non-public information giving rise to an Allowed Delay, (b) advise the Investors in writing to cease
all sales under the Registration Statement until the end of the Allowed Delay and (c) use commercially reasonable efforts to terminate an Allowed Delay as promptly as practicable. 
  

 -4- 

 3. Company Obligations. The Company will use commercially reasonable efforts to effect the
registration of the Registrable Securities in accordance with the terms hereof, and pursuant thereto the Company will, as expeditiously as possible: 
  
 (a) use commercially reasonable efforts to cause such Registration Statement to become effective and to remain continuously effective for
a period that will terminate upon the earlier of (i) the date on which all Registrable Securities covered by such Registration Statement as amended from time to time, have been sold, and (ii) the date on which all Registrable Securities covered by
such Registration Statement may be sold pursuant to Rule 144(k) (the “Effectiveness Period”) and advise the Investors in writing when the Effectiveness Period has expired; 
  
 (b) prepare and file with the SEC such amendments and post-effective amendments to the Registration
Statement and the Prospectus as may be necessary to keep the Registration Statement effective for the period specified in Section 3(a) and to comply with the provisions of the 1933 Act and the 1934 Act with respect to the distribution of all of the
Registrable Securities covered thereby; 
  
 (c)
provide copies to and permit counsel designated by the Investors to review each Registration Statement and all amendments and supplements thereto no fewer than seven (7) days prior to their filing with the SEC and not file any document to which such
counsel reasonably objects; 
  
 (d) furnish to
the Investors and their legal counsel (i) promptly after the same is prepared and publicly distributed, filed with the SEC, or received by the Company (but not later than two (2) Business Days after the filing date, receipt date or sending date, as
the case may be) one (1) copy of any Registration Statement and any amendment thereto, each preliminary prospectus and Prospectus and each amendment or supplement thereto, and each letter written by or on behalf of the Company to the SEC or the
staff of the SEC, and each item of correspondence from the SEC or the staff of the SEC, in each case relating to such Registration Statement (other than any portion of any thereof which contains information for which the Company has sought
confidential treatment), and (ii) such number of copies of a Prospectus, including a preliminary prospectus, and all amendments and supplements thereto and such other documents as each Investor may reasonably request in order to facilitate the
disposition of the Registrable Securities owned by such Investor that are covered by the related Registration Statement; 
  
 (e) use commercially reasonable efforts to (i) prevent the issuance of any stop order or other suspension of effectiveness and, (ii) if
such order is issued, obtain the withdrawal of any such order at the earliest possible moment; 
  
 (f) prior to any public offering of Registrable Securities, use commercially reasonable efforts to register or qualify or cooperate with
the Investors and their counsel in connection with the registration or qualification of such Registrable Securities for offer and sale under the securities or blue sky laws of such jurisdictions requested by the Investors and do any and all other
commercially reasonable acts or things necessary or advisable to enable the distribution in such jurisdictions of the Registrable Securities covered by the Registration Statement; provided, however, that the Company shall not be required in
connection therewith or as a condition thereto to (i) qualify to do business in any jurisdiction where it would not otherwise be required to qualify but for this Section 3(f), (ii) subject itself to 

  

 -5- 

 
general taxation in any jurisdiction where it would not otherwise be so subject but for this Section 3(f), or (iii) file a general consent to service of
process in any such jurisdiction; 
  
 (g)
use commercially reasonable efforts to cause all Registrable Securities covered by a Registration Statement to be listed on each securities exchange, interdealer quotation system or other market on which similar securities issued by the Company are
then listed; 
  
 (h) immediately notify the
Investors, at any time when a Prospectus relating to Registrable Securities is required to be delivered under the 1933 Act, upon discovery that, or upon the happening of any event as a result of which, the Prospectus included in a Registration
Statement, as then in effect, includes an untrue statement of a material fact or omits to state any material fact required to be stated therein or necessary to make the statements therein not misleading in light of the circumstances then existing,
and at the request of any such holder, promptly prepare and furnish to such holder a reasonable number of copies of a supplement to or an amendment of such Prospectus as may be necessary so that, as thereafter delivered to the purchasers of such
Registrable Securities, such Prospectus shall not include an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading in light of the circumstances
then existing; and 
  
 (i) otherwise use
commercially reasonable efforts to comply with all applicable rules and regulations of the SEC under the 1933 Act and the 1934 Act, take such other actions as may be reasonably necessary to facilitate the registration of the Registrable Securities
hereunder; and make available to its security holders, as soon as reasonably practicable, but not later than the Availability Date (as defined below), an earnings statement covering a period of at least twelve (12) months, beginning after the
effective date of each Registration Statement, which earnings statement shall satisfy the provisions of Section 11(a) of the 1933 Act, including Rule 158 promulgated thereunder (for the purpose of this subsection 3(i), “Availability Date”
means the 45th day following the end of the fourth fiscal quarter that includes the effective date of such Registration Statement, except that, if such fourth fiscal quarter is the last quarter of the Company’s fiscal year, “Availability
Date” means the 90th day after the end of such fourth fiscal quarter). 
  
 (j) With a view to making available to the Investors the benefits of Rule 144 (or its successor rule) and any other rule or regulation of the SEC that may at any time permit the Investors to sell shares of Common
Stock to the public without registration, the Company covenants and agrees to: (i) make and keep public information available, as those terms are understood and defined in Rule 144, until the earlier of (A) six months after such date as all of the
Registrable Securities may be resold pursuant to Rule 144(k) or any other rule of similar effect or (B) such date as all of the Registrable Securities shall have been resold; (ii) file with the SEC in a timely manner all reports and other documents
required of the Company under the 1934 Act; and (iii) furnish to each Investor upon request, as long as such Investor owns any Registrable Securities, (A) a written statement by the Company that it has complied with the reporting requirements of the
1934 Act, (B) a copy of the Company’s most recent Annual Report on Form 10-K or Quarterly Report on Form 10-Q, and (C) such other information as may be reasonably requested in order to avail such Investor of any rule or regulation of the SEC
that permits the selling of any such Registrable Securities without registration. 
  

 -6- 

 4. Due Diligence Review; Information. The Company shall make available, during normal business
hours, for inspection and review by the Investors, advisors to and representatives of the Investors (who may or may not be affiliated with the Investors and who are reasonably acceptable to the Company), all financial and other records, all SEC
Filings (as defined in the Purchase Agreement) and other filings with the SEC, and all other corporate documents and properties of the Company as may be reasonably necessary for the purpose of such review, and cause the Company’s officers,
directors and employees, within a reasonable time period, to supply all such information reasonably requested by the Investors or any such representative, advisor or underwriter in connection with such Registration Statement (including, without
limitation, in response to all questions and other inquiries reasonably made or submitted by any of them), prior to and from time to time after the filing and effectiveness of the Registration Statement for the sole purpose of enabling the Investors
and such representatives, advisors and underwriters and their respective accountants and attorneys to conduct initial and ongoing due diligence with respect to the Company and the accuracy of such Registration Statement. 
  
 The Company shall not disclose material nonpublic information to the
Investors, or to advisors to or representatives of the Investors, unless prior to disclosure of such information the Company identifies such information as being material nonpublic information and provides the Investors, such advisors and
representatives with the opportunity to accept or refuse to accept such material nonpublic information for review and any Investor wishing to obtain such information enters into an appropriate confidentiality agreement with the Company with respect
thereto. 
  
 5. Obligations of the Investors. 

 
 (a) Each Investor shall furnish in writing to the Company
such information regarding itself, the Registrable Securities held by it and the intended method of disposition of the Registrable Securities held by it, as shall be reasonably required to effect the registration of such Registrable Securities and
shall execute such documents in connection with such registration as the Company may reasonably request. At least five (5) Business Days prior to the first anticipated filing date of any Registration Statement, the Company shall notify each Investor
of the information the Company requires from such Investor if such Investor elects to have any of the Registrable Securities included in the Registration Statement. An Investor shall provide such information to the Company at least two (2) Business
Days prior to the first anticipated filing date of such Registration Statement if such Investor elects to have any of the Registrable Securities included in the Registration Statement. 
  
 (b) Each Investor, by its acceptance of the Registrable Securities agrees to cooperate with the Company as
reasonably requested by the Company in connection with the preparation and filing of a Registration Statement hereunder, unless such Investor has notified the Company in writing of its election to exclude all of its Registrable Securities from such
Registration Statement. 
  
 (c) Each Investor
agrees that, upon receipt of any notice from the Company of either (i) the commencement of an Allowed Delay pursuant to Section 2(c)(ii) or (ii) the happening of an event pursuant to Section 3(h) hereof, such Investor will immediately 

  

 -7- 

 
discontinue disposition of Registrable Securities pursuant to the Registration Statement covering such Registrable Securities, until the Investor’s
receipt of the copies of the supplemented or amended prospectus filed with the SEC and until any related post-effective amendment is declared effective and, if so directed by the Company, the Investor shall deliver to the Company (at the expense of
the Company) or destroy (and deliver to the Company a certificate of destruction) all copies in the Investor’s possession of the Prospectus covering the Registrable Securities current at the time of receipt of such notice. 
  
 6. Indemnification. 
  
 (a) Indemnification by the Company. The Company will
indemnify and hold harmless each Investor and its officers, directors, members, employees and agents, successors and assigns, and each other person, if any, who controls such Investor within the meaning of the 1933 Act, against any losses, claims,
damages or liabilities, joint or several, to which they may become subject under the 1933 Act or otherwise, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon: (i) any untrue
statement or alleged untrue statement of any material fact contained in any Registration Statement, any preliminary prospectus or final prospectus contained therein, or any amendment or supplement thereof; (ii) any blue sky application or other
document executed by the Company specifically for that purpose or based upon written information furnished by the Company filed in any state or other jurisdiction in order to qualify any or all of the Registrable Securities under the securities laws
thereof (any such application, document or information herein called a “Blue Sky Application”); (iii) the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the
statements therein not misleading; (iv) any violation by the Company or its agents of any rule or regulation promulgated under the 1933 Act applicable to the Company or its agents and relating to action or inaction required of the Company in
connection with such registration; or (v) any failure to register or qualify the Registrable Securities included in any such Registration in any state where the Company or its agents has affirmatively undertaken or agreed in writing that the Company
will undertake such registration or qualification on an Investor’s behalf and will reimburse such Investor, and each such officer, director or member and each such controlling person for any legal or other expenses reasonably incurred by them
in connection with investigating or defending any such loss, claim, damage, liability or action; provided, however, that the Company will not be liable in any such case if and to the extent that any such loss, claim, damage or
liability arises out of or is based upon an untrue statement or alleged untrue statement or omission or alleged omission so made in conformity with information furnished by such Investor or any such controlling person in writing specifically for use
in such Registration Statement or Prospectus. 
  
 (b) Indemnification by the Investors. Each Investor agrees, severally but not jointly, to indemnify and hold harmless, to the fullest extent permitted by law, the Company, its directors, officers, employees, stockholders and each
person who controls the Company (within the meaning of the 1933 Act) against any losses, claims, damages, liabilities and expense (including reasonable attorney fees) resulting from any untrue statement of a material fact or any omission of a
material fact required to be stated in the Registration Statement or Prospectus or preliminary prospectus or amendment or supplement thereto or necessary to make the statements therein not misleading, to the extent, but only to the extent that such
untrue statement or omission is contained in any information furnished in writing by such 

  

 -8- 

 
Investor to the Company specifically for inclusion in such Registration Statement or Prospectus or amendment or supplement thereto. In no event shall the
liability of an Investor be greater in amount than the dollar amount of the proceeds (net of all expense paid by such Investor in connection with any claim relating to this Section 6 and the amount of any damages such Investor has otherwise been
required to pay by reason of such untrue statement or omission) received by such Investor upon the sale of the Registrable Securities included in the Registration Statement giving rise to such indemnification obligation. 
  
 (c) Conduct of Indemnification Proceedings. Any
person entitled to indemnification hereunder shall (i) give prompt notice to the indemnifying party of any claim with respect to which it seeks indemnification and (ii) permit such indemnifying party to assume the defense of such claim with counsel
reasonably satisfactory to the indemnified party; provided that any person entitled to indemnification hereunder shall have the right to employ separate counsel and to participate in the defense of such claim, but the fees and expenses of
such counsel shall be at the expense of such person unless (a) the indemnifying party has agreed to pay such fees or expenses, or (b) the indemnifying party shall have failed to assume the defense of such claim and employ counsel reasonably
satisfactory to such person or (c) in the reasonable judgment of any such person, based upon written advice of its counsel, a conflict of interest exists between such person and the indemnifying party with respect to such claims (in which case, if
the person notifies the indemnifying party in writing that such person elects to employ separate counsel at the expense of the indemnifying party, the indemnifying party shall not have the right to assume the defense of such claim on behalf of such
person); and provided, further, that the failure of any indemnified party to give notice as provided herein shall not relieve the indemnifying party of its obligations hereunder, except to the extent that such failure to give notice
shall materially adversely affect the indemnifying party in the defense of any such claim or litigation. It is understood that the indemnifying party shall not, in connection with any proceeding in the same jurisdiction, be liable for fees or
expenses of more than one separate firm of attorneys at any time for all such indemnified parties. No indemnifying party will, except with the consent of the indemnified party, consent to entry of any judgment or enter into any settlement that does
not include as an unconditional term thereof the giving by the claimant or plaintiff to such indemnified party of a release from all liability in respect of such claim or litigation. 
  
 (d) Contribution. If for any reason the indemnification provided for in the preceding paragraphs (a)
and (b) is unavailable to an indemnified party or insufficient to hold it harmless, other than as expressly specified therein, then the indemnifying party shall contribute to the amount paid or payable by the indemnified party as a result of such
loss, claim, damage or liability in such proportion as is appropriate to reflect the relative fault of the indemnified party and the indemnifying party, as well as any other relevant equitable considerations. No person guilty of fraudulent
misrepresentation within the meaning of Section 11(f) of the 1933 Act shall be entitled to contribution from any person not guilty of such fraudulent misrepresentation. In no event shall the contribution obligation of a holder of Registrable
Securities be greater in amount than the dollar amount of the proceeds (net of all expenses paid by such holder in connection with any claim relating to this Section 6 and the amount of any damages such holder has otherwise been required to pay by
reason of such untrue or alleged untrue statement or omission or alleged omission) received by it upon the sale of the Registrable Securities giving rise to such contribution obligation. 
  

 -9- 

 7. Miscellaneous. 
  
 (a) Amendments and Waivers. This Agreement may be amended only by a writing signed by the Company and
the Required Investors. The Company may take any action herein prohibited, or omit to perform any act herein required to be performed by it, only if the Company shall have obtained the written consent to such amendment, action or omission to act, of
the Required Investors. 
  
 (b) Notices.
All notices and other communications provided for or permitted hereunder shall be made as set forth in Section 9.4 of the Purchase Agreement. 
  
 (c) Assignments and Transfers by Investors. The provisions of this Agreement shall be binding upon and inure to the benefit of the
Investors and their respective successors and assigns. An Investor may transfer or assign, in whole or from time to time in part, to one or more persons its rights hereunder in connection with the transfer of Registrable Securities by such Investor
to such person, provided that such Investor complies with all laws applicable thereto and provides written notice of assignment to the Company promptly after such assignment is effected. 
  
 (d) Assignments and Transfers by the Company. This Agreement may not be assigned by the Company
(whether by operation of law or otherwise) without the prior written consent of the Required Investors, provided, however, that the Company may assign its rights and delegate its duties hereunder to any surviving or successor corporation in
connection with a merger or consolidation of the Company with another corporation, or a sale, transfer or other disposition of all or substantially all of the Company’s assets to another corporation, without the prior written consent of the
Required Investors, after notice duly given by the Company to each Investor. 
  
 (e) Benefits of the Agreement. The terms and conditions of this Agreement shall inure to the benefit of and be binding upon the respective permitted successors and assigns of the parties. Nothing in this
Agreement, express or implied, is intended to confer upon any party other than the parties hereto or their respective successors and assigns any rights, remedies, obligations, or liabilities under or by reason of this Agreement, except as expressly
provided in this Agreement. 
  
 (f)
Counterparts; Faxes. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. This Agreement may also be executed via
facsimile, which shall be deemed an original. 
  
 (g) Titles and Subtitles. The titles and subtitles used in this Agreement are used for convenience only and are not to be considered in construing or interpreting this Agreement. 
  
 (h) Severability. Any provision of this Agreement
that is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof but shall be interpreted as if it were
written so as to be enforceable to the maximum extent permitted 

  

 -10- 

 
by applicable law, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other
jurisdiction. To the extent permitted by applicable law, the parties hereby waive any provision of law which renders any provisions hereof prohibited or unenforceable in any respect. 
  
 (i) Further Assurances. The parties shall execute and deliver all such further instruments and
documents and take all such other actions as may reasonably be required to carry out the transactions contemplated hereby and to evidence the fulfillment of the agreements herein contained. 
  
 (j) Entire Agreement. This Agreement is intended by
the parties as a final expression of their agreement and intended to be a complete and exclusive statement of the agreement and understanding of the parties hereto in respect of the subject matter contained herein. This Agreement supersedes all
prior agreements and understandings between the parties with respect to such subject matter. 
  
 (k) Governing Law; Consent to Jurisdiction; Waiver of Jury Trial. This Agreement shall be governed by, and construed in accordance
with, the internal laws of the State of New York without regard to the choice of law principles thereof. Each of the parties hereto irrevocably submits to the exclusive jurisdiction of the courts of the State of New York located in New York County
and the United States District Court for the Southern District of New York for the purpose of any suit, action, proceeding or judgment relating to or arising out of this Agreement and the transactions contemplated hereby. Service of process in
connection with any such suit, action or proceeding may be served on each party hereto anywhere in the world by the same methods as are specified for the giving of notices under this Agreement. Each of the parties hereto irrevocably consents to the
jurisdiction of any such court in any such suit, action or proceeding and to the laying of venue in such court. Each party hereto irrevocably waives any objection to the laying of venue of any such suit, action or proceeding brought in such courts
and irrevocably waives any claim that any such suit, action or proceeding brought in any such court has been brought in an inconvenient forum. EACH OF THE PARTIES HERETO WAIVES ANY RIGHT TO REQUEST A TRIAL BY JURY IN ANY LITIGATION WITH RESPECT
TO THIS AGREEMENT AND REPRESENTS THAT COUNSEL HAS BEEN CONSULTED SPECIFICALLY AS TO THIS WAIVER. 
  

 -11- 

 IN WITNESS WHEREOF, the parties have executed this Agreement or caused their duly authorized officers to
execute this Agreement as of the date first above written. 
  

									
	 The Company:
	 	 	 	 VELOCITY EXPRESS CORPORATION

					
	 	 	 	 	 	 	By:	 	 
	 	 	 	 	 	 	 Name:
	 	 
	 	 	 	 	 	 	 Title:
	 	 

  

 -12- 

									
	 The Investors:
	 	 	 	 SPECIAL SITUATIONS FUND III, L.P.

					
	 	 	 	 	 	 	By:	 	 
	 	 	 	 	 	 	 Name:
	 	 Austin W. Marxe

	 	 	 	 	 	 	 Title:
	 	 General Partner

			
	 	 	 	 	 SPECIAL SITUATIONS CAYMAN FUND, L.P.

					
	 	 	 	 	 	 	By:	 	 
	 	 	 	 	 	 	 Name:
	 	 Austin W. Marxe

	 	 	 	 	 	 	 Title:
	 	 General Partner

			
	 	 	 	 	 SPECIAL SITUATIONS PRIVATE EQUITY FUND, L.P.

					
	 	 	 	 	 	 	By:	 	 
	 	 	 	 	 	 	 Name:
	 	 Austin W. Marxe

	 	 	 	 	 	 	 Title:
	 	 General Partner

  

 -13- 

									
	 	 	 	 	 SCORPION CAPITAL PARTNERS, L.P.

					
	 	 	 	 	 	 	 By:
	 	 
	 	 	 	 	 	 	 Name:
	 	 
	 	 	 	 	 	 	 Title:
	 	 
			
	 	 	 	 	 SCORPION ACQUISITION LLC

					
	 	 	 	 	 	 	 By:
	 	 
	 	 	 	 	 	 	 Name:
	 	 
	 	 	 	 	 	 	 Title:
	 	 

  

 -14- 

									
	 	 	 	 	 PEQUOT SCOUT FUND, L.P.
 By Pequot Capital Management, Inc.
 as Investment Manager

					
	 	 	 	 	 	 	By:	 	 
	 	 	 	 	 	 	 Name:
	 	 Aryeh Davis

	 	 	 	 	 	 	 Title:
	 	 General Counsel

			
	 	 	 	 	 PEQUOT NAVIGATOR ONSHORE FUND, L.P.
 By Pequot Capital Management, Inc.
 as Investment Manager

					
	 	 	 	 	 	 	By:	 	 
	 	 	 	 	 	 	 Name:
	 	 Aryeh Davis

	 	 	 	 	 	 	 Title:
	 	 General Counsel

			
	 	 	 	 	 PEQUOT NAVIGATOR OFFSHORE FUND, INC.
 By Pequot Capital Management, Inc.
 as Investment Advisor

					
	 	 	 	 	 	 	By:	 	 
	 	 	 	 	 	 	 Name:
	 	 Aryeh Davis

	 	 	 	 	 	 	 Title:
	 	 General Counsel

			
	 	 	 	 	 PREMIUM SERIES PCC LIMITED - CELL 33

					
	 	 	 	 	 	 	By:	 	 
	 	 	 	 	 	 	 Name:
	 	 Michael Griffin

	 	 	 	 	 	 	 Title:
	 	 Authorized Signatory

  

 -15- 

			
	 TH LEE PUTNAM VENTURES, L.P.

		
	 By:
	 	 TH Lee Putnam Fund Advisors, L.P.,
its General Partner

		
	 By:
	 	 TH Lee Putnam Fund Advisors, LLC,
its General Partner

  

			
		
	By:	 	 
	 Name:
	 	 James Brown

	 Title:
	 	 Managing Director

  

			
	 TH LEE PUTNAM PARALLEL VENTURES, L.P.

		
	 By:
	 	 TH Lee Putnam Fund Advisors, L.P.,
its General Partner

		
	 By:
	 	 TH Lee Putnam Fund Advisors, LLC,
its General Partner

  

			
		
	By:	 	 
	 Name:
	 	 James Brown

	 Title:
	 	 Managing Director

  

			
	 THLi COINVESTMENT PARTNERS, LLC

		
	 By:
	 	 TH Lee Putnam Fund Advisors, L.P.,
its General Partner

		
	 By:
	 	 TH Lee Putnam Fund Advisors, LLC,
its General Partner

  

			
	 
		
	 By:
	 	 
	 Name:
	 	 James Brown

	 Title:
	 	 Managing Director

  

 -16- 

			
	 BLUE STAR I, LLC

		
	By:	 	 
	 Name:
	 	 Thomas H. Lee

	 Title:
	 	 Managing Member

  

 -17- 

	
	
	 
	 Jack Duffy

  

	
	
	 
	 William Kingston

  

	
	
	 
	 Dolph DiBiasi

  

	
	
	 
	 Vincent Wasik

  

 -18- 

			
	PALM BEACH OVERSEAS INVESTORS, LIMITED
		
	 By:
	 	 
	 Name:
	 	 Mark Kesselman

	 Title:
	 	 Authorized Signatory

  

 -19- 

  
 Exhibit A 

 
 Plan of Distribution 
  
 The selling stockholders, which as used herein includes donees, pledgees,
transferees or other successors-in-interest selling shares of common stock or interests in shares of common stock received after the date of this prospectus from a selling stockholder as a gift, pledge, partnership distribution or other transfer,
may, from time to time, sell, transfer or otherwise dispose of any or all of their shares of common stock or interests in shares of common stock on any stock exchange, market or trading facility on which the shares are traded or in private
transactions. These dispositions may be at fixed prices, at prevailing market prices at the time of sale, at prices related to the prevailing market price, at varying prices determined at the time of sale, or at negotiated prices. 
  
 The selling stockholders may use any one or more of the following methods
when disposing of shares or interests therein: 
  

	 	•	ordinary brokerage transactions and transactions in which the broker-dealer solicits purchasers; 

  

	 	•	block trades in which the broker-dealer will attempt to sell the shares as agent, but may position and resell a portion of the block as principal to facilitate the transaction;

  

	 	•	purchases by a broker-dealer as principal and resale by the broker-dealer for its account; 

  

	 	•	an exchange distribution in accordance with the rules of the applicable exchange; 

  

	 	•	privately negotiated transactions; 

  

	 	•	short sales effected after the date the registration statement of which this Prospectus is a part is declared effective by the SEC; 

  

	 	•	through the writing or settlement of options or other hedging transactions, whether through an options exchange or otherwise; 

  

	 	•	broker-dealers may agree with the selling stockholders to sell a specified number of such shares at a stipulated price per share; 

  

	 	•	a combination of any such methods of sale; and 

  

	 	•	any other method permitted pursuant to applicable law. 

  
 The selling stockholders may, from time to time, pledge or grant a security interest in some or all of the shares of common stock owned by them and, if
they default in the performance of their secured obligations, the pledgees or secured parties may offer and sell the shares of common stock, from time to time, under this prospectus, or under an amendment to this 

  

 
prospectus under Rule 424(b)(3) or other applicable provision of the Securities Act amending the list of selling stockholders to include the pledgee,
transferee or other successors in interest as selling stockholders under this prospectus. The selling stockholders also may transfer the shares of common stock in other circumstances, in which case the transferees, pledgees or other successors in
interest will be the selling beneficial owners for purposes of this prospectus. 
  
 In connection with the sale of our common stock or interests therein, the selling stockholders may enter into hedging transactions with broker-dealers or other financial institutions, which may in turn engage in short
sales of the common stock in the course of hedging the positions they assume. The selling stockholders may also sell shares of our common stock short and deliver these securities to close out their short positions, or loan or pledge the common stock
to broker-dealers that in turn may sell these securities. The selling stockholders may also enter into option or other transactions with broker-dealers or other financial institutions or the creation of one or more derivative securities which
require the delivery to such broker-dealer or other financial institution of shares offered by this prospectus, which shares such broker-dealer or other financial institution may resell pursuant to this prospectus (as supplemented or amended to
reflect such transaction). 
  
 The aggregate proceeds to the
selling stockholders from the sale of the common stock offered by them will be the purchase price of the common stock less discounts or commissions, if any. Each of the selling stockholders reserves the right to accept and, together with their
agents from time to time, to reject, in whole or in part, any proposed purchase of common stock to be made directly or through agents. We will not receive any of the proceeds from this offering. Upon any exercise of the warrants by payment of cash,
however, we will receive the exercise price of the warrants. 
  
 The selling stockholders also may resell all or a portion of the shares in open market transactions in reliance upon Rule 144 under the Securities Act of 1933, provided that they meet the criteria and conform to the requirements of that
rule. 
  
 The selling stockholders and any underwriters,
broker-dealers or agents that participate in the sale of the common stock or interests therein may be “underwriters” within the meaning of Section 2(11) of the Securities Act. Any discounts, commissions, concessions or profit they earn on
any resale of the shares may be underwriting discounts and commissions under the Securities Act. Selling stockholders who are “underwriters” within the meaning of Section 2(11) of the Securities Act will be subject to the prospectus
delivery requirements of the Securities Act. 
  
 To the extent
required, the shares of our common stock to be sold, the names of the selling stockholders, the respective purchase prices and public offering prices, the names of any agents, dealer or underwriter, any applicable commissions or discounts with
respect to a particular offer will be set forth in an accompanying prospectus supplement or, if appropriate, a post-effective amendment to the registration statement that includes this prospectus. 
  
 In order to comply with the securities laws of some states, if applicable,
the common stock may be sold in these jurisdictions only through registered or licensed brokers or dealers. In addition, in some states the common stock may not be sold unless it has been registered or 

  

 -21- 

 
qualified for sale or an exemption from registration or qualification requirements is available and is complied with. 
  
 We have advised the selling stockholders that the anti-manipulation rules of
Regulation M under the Exchange Act may apply to sales of shares in the market and to the activities of the selling stockholders and their affiliates. In addition, we will make copies of this prospectus (as it may be supplemented or amended from
time to time) available to the selling stockholders for the purpose of satisfying the prospectus delivery requirements of the Securities Act. The selling stockholders may indemnify any broker-dealer that participates in transactions involving the
sale of the shares against certain liabilities, including liabilities arising under the Securities Act. 
  
 We have agreed to indemnify the selling stockholders against liabilities, including liabilities under the Securities Act and state securities laws,
relating to the registration of the shares offered by this prospectus. 
  
 We have agreed with the selling stockholders to keep the registration statement of which this prospectus constitutes a part effective until the earlier of (1) such time as all of the shares covered by this prospectus have been disposed of
pursuant to and in accordance with the registration statement or (2) the date on which the shares may be sold pursuant to Rule 144(k) of the Securities Act. 
  

 -22-

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