Document:

exh4-1_17798.htm

EXHIBIT 4.1

 

 

THE SECURITIES REPRESENTED BY THIS CALL OPTION AGREEMENT HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR UNDER ANY STATE SECURITIES ACT. SUCH SECURITIES HAVE BEEN ACQUIRED FOR INVESTMENT AND MAY NOT BE SOLD, TRANSFERRED, PLEDGED OR HYPOTHECATED UNLESS (I) THEY HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND ANY APPLICABLE STATE SECURITIES ACT, OR (II) THE COMPANY SHALL HAVE BEEN FURNISHED AN OPINION OF COUNSEL, SATISFACTORY TO COUNSEL FOR THE COMPANY, THAT REGISTRATION IS NOT REQUIRED UNDER ANY OF SUCH ACTS.

 

CALL OPTION AGREEMENT

 

This Call Option Agreement (this “Agreement”), is made and entered as of [•], 2015 (the “Effective Date”), by and among Empire Petroleum Corporation, a Delaware corporation (the “Company”), and [•] (“Optionee”).  The Company and Optionee are sometimes collectively referred to herein as the “Parties” and singly as a “Party.”

 

 

WHEREAS, Optionee desires to have the right to purchase 125,000 shares (the “Shares”) of the Company’s common stock, and the Company desires to grant such right to Optionee, pursuant to the terms and conditions set forth herein.

 

 

NOW, THEREFORE, in consideration of the foregoing, and the mutual and dependent covenants hereinafter set forth, the Parties agree as follows:

 

 

1.             Grant of Call Option.

 

(a)   Right to Purchase. Subject to the terms and conditions of this Agreement, at any time from the Effective Date through two years thereafter (the “Call End Date”), Optionee shall have the right (the “Call Right”), but not the obligation, to purchase all or less than all of the Shares at a purchase price of $0.25 per Share (the “Call Purchase Price”).

 

(b)           Procedures.

 

(i) If Optionee desires to purchase one or more of the Shares, Optionee shall deliver to the Company a written notice (the “Call Exercise Notice”) exercising the Call Right on or before the Call End Date and shall send Optionee’s original executed version of this Agreement back to the Company along with such Call Exercise Notice.  In the event the Call Right is not exercised on or before the Call End Date, the Call Right shall automatically, without further action, expire and become null and void.

 

(ii) The closing of any sale of Shares pursuant to this Section 1 shall take place at the Company’s office at a time mutually agreeable to the Parties but in no event later than five business days following receipt by the Company of the Call Exercise Notice.

 

 

 

 

  

  

  

(c)           Consummation of Sale. The consummation of the sale of the Shares, if any, shall occur effective as of the receipt of the payment of the Call Purchase Price by certified or official bank check or by wire transfer of immediately available funds.  As soon as practicable, but not later than five business days after the Company shall have received the Call Exercise Notice and payment, the Company shall execute and deliver or cause to be executed and delivered a certificate or certificates representing the Shares.  In addition, if Optionee purchases less than all of the Shares subject to this Agreement in connection with any Call Exercise Notice, the Parties shall cause a new call option agreement related to the Shares not subject to such Call Exercise Notice to be executed and delivered to each other in a form substantially similar to this Agreement.

 

(d)   Disclosure Materials.  Optionee represents and warrants to the Company that  Optonee has reviewed the following copies of the Company’s reports (all of which is collectively referred to as the “Disclosure Materials”):

 

(i) Annual Report on Form 10-K for year ended 12/31/14 located at http://www.sec.gov/Archives/edgar/data/887396/000107261315000242/0001072613-15-000242-index.htm;

 

(ii) Current Report on Form 8-K filed 3/3/15 located at http://www.sec.gov/Archives/edgar/data/887396/000107261315000199/0001072613-15-000199-index.htm;

 

(iii) Current Report on Form 8-K filed 1/26/15 located at https://www.sec.gov/Archives/edgar/data/887396/000107261314000498/form8k_17737.htm;

 

(iv) Information Statement on Schedule 14f-1 filed 1/5/15 located at https://www.sec.gov/Archives/edgar/data/887396/000107261314000500/sc14f1_17737b.htm;

 

(v) Current Report on Form 8-K filed 12/30/14 located at https://www.sec.gov/Archives/edgar/data/887396/000107261314000498/form8k_17737.htm; and

 

(vi) Quarterly Report on Form 10-Q for quarter ended 9/30/14 located at https://www.sec.gov/Archives/edgar/data/887396/000088739614000006/form10q-092014.htm.

 

(e)   Representations and Warranties.  Optionee represents and warrants to the Company as follows:

 

(i) Optionee has also reviewed the Company’s Certificate of Incorporation, as amended, and Bylaws.

 

(ii) Optionee is experienced in evaluating and investing in companies such as the Company and understands that the option granted hereby and the Shares underlying such option (the “Securities”) are of a highly speculative nature and could result in the loss of Optionee’s entire investment.

 

 

 

  

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(iii) Optionee has been furnished by the Company with all information requested concerning the proposed operations, affairs and current financial condition of the Company.  Such information and access have been available to the extent Optionee considers necessary and advisable in making an intelligent investment decision.  In addition, Optionee has received and reviewed copies of the Disclosure Materials and has had the opportunity to discuss the Company’s business, management and financial affairs with its Chief Executive Officer.  Optionee understands that such discussions, as well as the Disclosure Materials and any other written information issued by the Company, were intended to describe certain aspects of the Company’s business and prospects which it believes to be material but were not necessarily a thorough or exhaustive description.

 

(iv) The Securities to be acquired by you will be acquired, solely for your account, for investment purposes only and not with a view to the resale or distribution thereof, are not being purchased for subdivision or fractionalization thereof, and Optionee has no contract, undertaking, agreement or arrangement with any person to sell or transfer such Securities to any person and does not intend to enter into such contract or arrangement.

 

(v) Optionee understands that the Securities have not been registered under the Securities Act of 1933, as amended (the “Securities Act”), nor are they registered or qualified under the blue sky or securities laws of any state, by reason of their issuance in a transaction exempt from the registration and prospectus delivery requirements of the Securities Act pursuant to Sections 3(b) or 4(2) of the Securities Act and available exemptions from the registration requirements of any applicable state securities laws.  Optionee further understands that the Securities must be held by Optionee indefinitely and Optionee must therefore bear the economic risk of such investment indefinitely, unless a subsequent disposition thereof is registered under the Securities Act or is exempt from registration.

 

(vi) Optionee has the full right, power and authority to enter into and perform this Agreement, and this Agreement constitutes a legal, valid and binding obligation upon Optionee, except as may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws of general application affecting enforcement of creditors’ rights, and except as limited by application of legal principles affecting the availability of equitable remedies.

 

(vii) Optionee is able to bear the full economic risk of Optionee’s investment in the Securities, including the risk of a total loss of your investment in connection therewith.

 

(viii) By initialing one of the categories below, Optionee represents and warrants that Optionee falls within the category so initialed and has truthfully set forth the factual basis or reason the undersigned comes within that category:

 

Category I.  _____.  Optionee is an individual (not a partnership, corporation, etc.) whose individual net worth, or joint net worth with the undersigned's spouse, presently exceeds U.S. $1,000,000.

 

Category II.  _____.  Optionee is an individual (not a partnership, corporation, etc.) who had an individual income in excess of U.S. $200,000 in each of the two most recent years, or joint income with the undersigned's spouse in excess of $300,000 in each of the two most recent years, and has a reasonable expectation of reaching the same income level in the current year.

 

 

 

  

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Category III.  _____.  The undersigned otherwise meets the definition of “Accredited Investors” as defined in Section 230.501(a) of the Act.

 

(ix) Optionee was not offered the Securities by means of general solicitations, publicly disseminated advertisements or sales literature.

 

(f)   Legends.  Optiones acknowledges and agrees the instrument representing the Shares shall be endorsed with the legend set forth below:

 

THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR UNDER ANY STATE SECURITIES ACT.  THE SECURITIES HAVE BEEN ACQUIRED FOR INVESTMENT AND MAY NOT BE SOLD, TRANSFERRED, PLEDGED OR HYPOTHECATED UNLESS (I) THEY HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND ANY APPLICABLE STATE SECURITIES ACT, OR (II) THE COMPANY SHALL HAVE BEEN FURNISHED AN OPINION OF COUNSEL, SATISFACTORY TO COUNSEL FOR THE COMPANY, THAT REGISTRATION IS NOT REQUIRED UNDER ANY OF SUCH ACTS.

 

In addition, the instrument representing the Shares shall be endorsed with any other legend required by any state securities laws.  The Company need not register a transfer of legended Securities, and may also instruct its transfer agent not to register the transfer of the Securities, unless one of the conditions specified in each of the foregoing legends is satisfied.

 

(g)   Indemnification by Purchaser.  Optionee acknowledges and agrees that the Company has agreed to offer and sell the Securities to Optionee based upon the representations and warranties made by you in this Agreement, and Optionee hereby agree to indemnify the Company and to hold the Company and its incorporators, officers, directors and professional advisors harmless against all liability, costs or expenses (including attorneys’ fees) arising by reason of or in connection with any misrepresentation or any breach of such representations and warranties by Optioneee, or arising as a result of the sale or distribution of any Securities by Optionee in violation of the Securities Act or other applicable law.

 

2.     Notices. All notices, requests, consents, claims, demands, waivers and other communications hereunder shall be in writing and shall be deemed to have been given (a) when delivered by hand (with written confirmation of receipt); (b) when received by the addressee if sent by a nationally recognized overnight courier (receipt requested); (c) on the date sent by facsimile or e-mail of a PDF document (with confirmation of transmission) if sent during normal business hours of the recipient, and on the next business day if sent after normal business hours of the recipient; or (d) on the third day after the date mailed, by certified or registered mail, return receipt requested, postage prepaid. Such communications must be sent to the respective parties at the addresses indicated below (or at such other address for a party as shall be specified in a notice given in accordance with this Section 2).

 

 

 

  

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If to Optionee:

 

 

 

	
[Insert address]

 

	
If to the Company:

	
Empire Petroleum Corporation

165 S. Union Blvd.

Union Tower, Suite 360

Facsimile:  [•]

E-mail: jcw@empirepertocorp.com

 

3.             Entire Agreement. This Agreement constitutes the sole and entire agreement of the parties to this Agreement with respect to the subject matter contained herein, and supersedes all prior and contemporaneous understandings and agreements, both written and oral, with respect to such subject matter.

 

4.             Successor and Assigns. Neither this Agreement nor any of the rights of the parties hereunder may otherwise be transferred or assigned by any Party hereto by operation of law or otherwise. Any attempted transfer or assignment in violation of this Section 4 shall be void.

 

5.             No Third-Party Beneficiaries. This Agreement is for the sole benefit of the Parties hereto and their respective successors and permitted assigns and nothing herein, express or implied, is intended to or shall confer upon any other person any legal or equitable right, benefit or remedy of any nature whatsoever, under or by reason of this Agreement.

 

6.             Headings. The headings in this Agreement are for reference only and shall not affect the interpretation of this Agreement.

 

7.             Amendment and Modification; Waiver. This Agreement may only be amended, modified or supplemented by an agreement in writing signed by each Party. No waiver by any party of any of the provisions hereof shall be effective unless explicitly set forth in writing and signed by the Party so waiving.  Except as otherwise set forth in this Agreement, no failure to exercise, or delay in exercising, any rights, remedy, power or privilege arising from this Agreement shall operate or be construed as a waiver thereof; nor shall any single or partial exercise of any right, remedy, power or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, remedy, power or privilege.

 

8.             Severability. If any term or provision of this Agreement is invalid, illegal or unenforceable in any jurisdiction, such invalidity, illegality or unenforceability shall not affect any other term or provision of this Agreement or invalidate or render unenforceable such term or provision in any other jurisdiction.

 

9.             Governing Law. This Agreement shall be governed by and construed in accordance with the internal laws of the State of Delaware without giving effect to any choice or conflict of law provision or rule (whether of the State of Delaware or any other jurisdiction) that would cause the application of Laws of any jurisdiction other than those of the State of Delaware.

 

 

 

  

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10.           Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original, but all of which shall together be deemed to be one and the same agreement.  A signed copy of this Agreement delivered by facsimile, e-mail or other means of electronic transmission shall be deemed to have the same legal effect as delivery of an original signed copy of this Agreement.

 

11.           No Strict Construction. The Parties have participated jointly in the negotiation and drafting of this Agreement. In the event an ambiguity or question of intent or interpretation arises, this Agreement will be construed as if drafted jointly by the Parties, and no presumption or burden of proof will arise favoring or disfavoring any Party by virtue of the authorship of any of the provisions of this Agreement.

           IN WITNESS WHEREOF, the parties hereto have executed this Call Option Agreement on the date first written above.

	  	
EMPIRE PETROLEUM CORPORATION

	  	
 

By:_____________________

      J. C. Whorton, Jr.

      CEO

 

 

 

	  	
[•]

	  	
 

By:_____________________

      [•]

      [•]

 

 

 

 

 

  

6EXHIBIT 10.1

 

EMPLOYMENT AGREEMENT 

 

AGREEMENT effective this
1st day of June, 2015 by and between TSR Inc., a Delaware corporation, with offices at 400 Oser Avenue, Hauppauge, New York 11788
(hereinafter called the “Corporation”) and John G. Sharkey, residing at XXXXXXXXXX (hereinafter called “Executive”).

  

W I T N E S S E T H :

 

WHEREAS, the Corporation
desires to employ Executive and Executive is willing to undertake such employment on the terms and subject to the conditions hereinafter
set forth;

  

NOW, THEREFORE, in consideration
of the mutual covenants hereinafter set forth, the parties hereto agree as follows:

 

1.                 
The Corporation hereby employs Executive as Vice President of Finance and Controller of the Corporation or such other position
as he may be elected or appointed to by the Corporation’s Board of Directors, to perform such supervisory or executive duties
on behalf of the Corporation as the Board of Directors of the Corporation may from time to time determine.

 

2.                 
Executive hereby accepts such employment and agrees that throughout the period of his employment hereunder, he will devote
his full time, attention, knowledge and skills, faithfully, diligently and to the best of his ability, in furtherance of the business
of the Corporation and to promote the interest of the Corporation, will perform the duties assigned to him pursuant to Paragraph
1 hereof, subject, at all times, to the direction and control of the Board of Directors of the Corporation and the Corporation’s
President. Executive shall at all times be subject to, observe and carry out such rules and regulations as the Board of Directors
or President of the Corporation may from time to time establish. During the period of Executive’s employment hereunder, Executive
shall not be entitled to additional compensation for serving in any office of the Corporation or any of its subsidiaries to which
he is elected, including without limitation as a director of the Corporation or any of its subsidiaries.

 

3.                 
Executive shall be employed for a term of five (5) years commencing as of the 1st day of June, 2015 and ending on the 31st
day of May, 2020 (the “Term”), unless his employment is terminated prior to the expiration of said five (5) year Term
pursuant to the provisions hereof.

 

    	 

    	 

    

 

4.                 
As full compensation for his services hereunder, the Corporation will pay to Executive a salary at the rate of Two Hundred
Fifty Thousand ($250,000) Dollars per annum, payable in equal installments no less frequently than semi-monthly. The annual salary
shall be subject to increase in the discretion of the President of the Corporation. In addition, Executive shall be entitled to
a discretionary bonus, in an amount determined in good faith by the Compensation Committee of the Board of Directors of the Corporation
based on recommendation of the President of the Corporation, based on standards relating to the Executive’s performance and
the Corporation’s performance determined in good faith by the Compensation Committee of the Board of Directors of the Corporation
based on the recommendation of the President of the Corporation. The bonus provided for hereunder shall be payable by the Corporation
to Executive within 30 days of the end of the fiscal year to which such bonus relates. In addition to such compensation, Executive
shall be entitled to participate, to the extent he is eligible under the terms and conditions thereof, in any pension, profit-sharing,
retirement, hospitalization, insurance medical services, or other employee benefit plan generally available to executives of the
Corporation which may be in effect from time to time during the period of his employment hereunder. The Corporation shall be under
no obligation to institute or continue the existence of any such employee benefit plan. Executive shall also continue to be entitled
to a leased car comparable to the car which he is currently provided. Executive shall be entitled to four weeks of paid vacation
for each year.

 

5.                 
The Corporation shall reimburse Executive for all expenses reasonably incurred by him in connection with the performance
of his duties hereunder in the business of the Corporation, upon the submission to the Corporation of appropriate vouchers therefor
and approval thereof by the President of the Corporation; provided, however, that no reimbursement has been made by the Corporation
for expenses substantially disallowed, Executive shall reimburse the Corporation for any such amounts. Such reimbursements shall
be subject to the expense reimbursement policies of the Corporation which are in effect from time to time.

 

6.                 
Notwithstanding any provision contained herein to the contrary, the Corporation may terminate Executive’s employment
hereunder at any time for “Cause” as such term has been interpreted pursuant to the decisions of the courts of the
State of New York which have interpreted the meaning for “Cause” for justifiable termination pursuant to employment
arrangements generally. The Corporation may terminate such employment without Cause at any time; provided however, the Corporation
shall continue to pay Executive his base compensation, which shall not exceed the rate of $250,000 per annum, during the balance
of the term. In the event of a termination of Executive’s employment, Executive shall be eligible to continue to receive,
at the Corporation’s expense, all benefits provided by the Corporation as enumerated in Paragraph 4, above.

 

7.                 
Change in Control. (a) Executive shall have the right to terminate his employment hereunder following a Change in
Control. If Executive elects to terminate his employment hereunder, he shall do so by written notice given within 90 days after
the event constituting a Change in Control.

  

      (b) For purposes of this
Agreement “Change in Control” shall mean that any of the following events has occurred:

 

    	 

    	 

    

 

		(i)	An acquisition (other than directly from the Corporation) of any voting securities of the Corporation
(treating all classes of outstanding voting securities or other securities convertible into voting securities as if they were converted
into voting securities) (the "Voting Securities") by any "person", "entity" or "group
of affiliated persons" (as such terms are used for purposes of Section 13(d) or 14(d) (collectively, "Persons")
of the Securities Exchange Act of 1934, as amended (the "1934 Act") (other than Joseph Hughes or a group which includes
Joseph Hughes) immediately after which such Person has "Beneficial Ownership" (within the meaning of Rule 13d-3
promulgated under the 1934 Act and irrespective of any vesting or waiting periods) of twenty (20%) percent or more of the combined
voting power of the Corporation's then outstanding Voting Securities; unless immediately after such acquisition Joseph Hughes beneficially
owns a greater percentage of the Voting Securities than such Persons.
	 	 	 
	 	(ii)	An acquisition of any voting
securities of the corporation (treating all classes of outstanding voting securities or other securities convertible into voting
securities as if they were converted into voting securities) ( the “Voting  Securities” by any “person”,
“entity” or “group of affiliated persons” ( as such terms are used for purposes of Section 13(d) or 14(d)
( collectively, “ Persons” ) of the Securities Exchange Act of 1934 , as amended ( the “1934 Act”)
( other than Joseph Hughes or a group which includes Joseph Hughes) immediately after which such Person has A
Beneficial Ownership@ ( within the meaning of Rule 13d-3
promulgated under the 1934 Act and irrespective of any vesting or waiting periods) of a greater percentage of the Voting Securities
than Joseph Hughes, if within six months thereafter the individuals who were members of the Board of Directors immediately prior
to such acquisition or the initial agreement relating to such acquisition no longer constitute at least a majority of the members
of the Board of Directors of the Corporation. 
	 	 	 
	 	(iii)	A merger,
consolidation or reorganization involving the Corporation or a sale of all or substantially all of the assets of the Corporation,
unless

    

    	 

    	 

    

  

(A) the shareholders
of the Corporation, immediately before such merger, consolidation or reorganization, own, directly or indirectly, immediately following
such merger, consolidation or reorganization, more than fifty (50%) percent of the combined voting power of the outstanding Voting
Securities of the entity resulting from such merger or consolidation or reorganization or sale of all or substantially all of the
assets (the "Surviving Entity") in substantially the
same proportion as their ownership of the Voting Securities immediately before such merger, consolidation or reorganization or
sale of all or substantially all of the assets, and

 

(B) the individuals
who were members of the Board of Directors immediately prior to the execution of the agreement providing for such merger, consolidation
or reorganization or sale of all or substantially all of the assets constitute at least a majority of the members of the board
of directors of the Surviving Entity or an entity beneficially owning, directly or indirectly, a majority of the Voting Securities
of the Surviving Entity, and

 

(C) no Person (other
than the Corporation, any subsidiary, any employee benefit plan (or any trust forming a part thereof) maintained by the Corporation,
the Surviving Entity or any subsidiary, or any Person who, immediately prior to such merger, consolidation or reorganization or
sale of all or substantially all of the assets had Beneficial Ownership of thirty (30%) percent or more of the then outstanding
Voting Securities) owns, directly or indirectly, thirty (30%) percent or more of the combined voting power of the Surviving
Entity's then outstanding Voting Securities.

 

		(iv)	A complete liquidation or dissolution of the Corporation.

 

		(v)	There has been a public announcement of a Change in Control of the Corporation (provided, however,
that consummation of the Change in Control of the Corporation shall be a condition precedent to the effectiveness of this provision)
and at any time thereafter the employment of the Executive under this Agreement is terminated for any reason whatsoever;

 

(c) Notwithstanding the
foregoing, a Change in Control shall not be deemed to occur solely because any Person (the "Subject Person") acquired
Beneficial Ownership of more than the permitted amount of the outstanding Voting Securities as a result of the acquisition of Voting
Securities by the Corporation which, by reducing the number of Voting Securities outstanding, increases the proportional number
of shares Beneficially Owned by the Subject Person, provided that if a Change in Control would occur (but for the operation of
this sentence) as a result of the acquisition of Voting Securities by the Corporation, and after such share acquisition by the
Corporation, the Subject Person becomes the Beneficial Owner of any additional Voting Securities which increases the percentage
of the then outstanding Voting Securities Beneficially Owned by the Subject Person, then a Change in Control shall occur.

 

    	 

    	 

    

 

    (d) If Executive’s
employment is terminated pursuant to this Section, the Corporation shall pay to the Executive (i) his full salary at the rate then
in effect through the date of termination and plus an amount equal to two times the annual salary payable hereunder at the rate
then in effect and (ii) and an amount equal to the pro rata portion of the bonus to which Executive is entitled for the then current
year (based on the portion of the year through the date of termination) through the date of termination or if such amount cannot
be determined, the pro rata portion of the bonus paid for the preceding year through the date of termination plus an amount equal
to the bonus payable for a two year period based on the annual bonus payable for the then current year, or if such amount cannot
be determined, the amount of the bonus paid for the prior year. In addition, the Corporation will continue to provide and to Executive,
at the Corporation’s expense, all benefits as enumerated in Paragraph 4 above for a period of two years.

 

8.                 
The Corporation and Executive are simultaneously herewith entering into a Maintenance of Confidence and Non-Compete Agreement,
the terms of which are hereby expressly incorporated into this Agreement, provided, however, that the Maintenance of Confidence
and Non-Compete Agreement shall continue to be effective notwithstanding any termination of Executive’s employment hereunder
and shall continue in effect upon expiration of this Employment Agreement pursuant to the terms of the Maintenance of Confidence
and Non-Compete Agreement.

 

9.                 
In the event of Executive’s death during the Term, this Agreement shall terminate immediately, and Executive’s
legal representatives shall be entitled to receive the salary due Executive through the last day of the calendar month during which
his death shall have occurred.

 

10.             
If, during the Term, Executive is unable to perform his duties hereunder on account of illness, accident or other physical
or mental incapacity and such illness or other incapacity shall continue for a period of six (6) consecutive months or an aggregate
of one hundred and eighty (180) days in any consecutive twelve (12) month period, the Corporation shall have the right, on fifteen
(15) days written notice (given after such period) to Executive, to terminate this Agreement. In such event, the Corporation shall
be obligated to pay to Executive his compensation only to the end of the calendar month in which such termination occurs. However,
if prior to the date specified in such notice, Executive’s illness or incapacity shall have terminated and he shall have
taken up the performance of his duties hereunder, Executive shall be entitled to resume his employment hereunder, as though such
notice had not been given.

 

11.             
(a) The Corporation shall have the right from time to time to purchase, increase, modify or terminate insurance policies
on the life of Executive for the benefit of the Corporation, in such amounts as the Corporation shall determine in its sole discretion.

 

    (b) In connection with
paragraph 11(a) above, Executive shall, at such time or times and at such place or places as the Corporation may reasonably direct,
submit himself to such physical examinations and execute and deliver such documents as the Corporation may deem necessary or desirable,
the results of which shall be kept strictly confidential.

 

    	 

    	 

    

  

12.             
Confidentiality. Executive acknowledges that he, through his status as Vice President, Finance and Controller of
the Corporation, will have possession of Confidential Information (as defined herein) as to the business of the Corporation. Executive
agrees that all such Confidential Information constitutes a vital part of the business of the Corporation and its affiliates and
is by its nature trade secrets and confidential information proprietary to the Corporation and its affiliates. Executive agrees
that he shall not divulge, communicate, furnish or make accessible (whether orally or in writing or in books, articles or any other
medium to any individual, firm, partnership, corporation or other entity or person, any knowledge or information with respect to
Confidential Information directly or indirectly relating to the business of the Corporation or any of its affiliates. The term
“Confidential Information” shall mean any information not generally known in the relevant trade or otherwise not generally
available to the public, which was obtained from the Corporation or which was learned, discovered, developed, conceived, originated
or prepared during or as a result of the performance of any services by Executive on behalf of the Corporation.

  

13.             
The parties hereto acknowledge that Executive’s service are unique and that, in the event of a breach of Executive
of any of his obligations under this Agreement, the corporation will not have an adequate remedy at law. Accordingly, in the event
of any such breach of threatened breach by Executive, the Corporation shall be entitled to such equitable and injunctive relief
as may be available to restrain the Executive participating in such breach of threatened breach from the violation of the provisions
thereof. Nothing herein shall be construed as prohibiting the Corporation from pursuing any other remedies at law or in equity
for such breach or threatened breach, including the recovery of damages and the immediate termination of the employment of Executive
hereunder.

 

 

14.             
This Agreement together with the Maintenance of Confidence and Non-Compete Agreement executed on the same date hereof, constitute
the entire agreement of the parties hereto and no amendment or modification hereof shall be valid or binding unless made in writing
and signed by the party against whom enforcement thereof is sought.

 

15.             
Any notice required, permitted or desired to be given pursuant to any of the provisions of this Agreement shall be deemed
to have been sufficiently given or served for all purposes if delivered in person or sent by certified mail, return receipt requested,
postage and fees prepaid as follows:

 

If to the Corporation
at:

 

Chairman of the Board

TSR, Inc.

400 Oser Avenue

Hauppauge, New York 11788

 

With a copy to:

 

John A. Aiello, Esq.

Giordano, Halleran &
Ciesla

125 Half Mile Road, Suite
300

Red Bank, NJ 07701

 

    	 

    	 

    

 

If to the Executive at:

Mr. John Sharkey

XXXXXX

XXXXXX

 

Either of the parties hereto may at any time
and from time to time change the address to which notice shall be sent hereunder by notice to the other party given under this
paragraph 15. The date of the giving of any notice sent by mail shall be the date of the posting of the mail.

 

16.             
Neither this Agreement nor the right to receive any payments hereunder may be assigned by Executive. This Agreement shall
be binding upon Executive, his heirs, executors and administrators and upon the Corporation, its successors and assigns.

 

17.             
No course of dealing nor any delay on the part of the Corporation in exercising any rights hereunder shall operate as a
waiver of any such rights. No waiver of any default or breach of this Agreement shall be deemed a continuing waiver or a waiver
of any other breach or default.

  

18.             
This Agreement shall be governed, interpreted and construed in accordance with the laws of the State of New York applicable
to agreements entered into and to be performed entirely therein.

 

19.             
If any clause, paragraph, section of part of this Agreement shall be held or declared to be void, invalid or illegal, for
any reason, by any court of competent jurisdiction, such provision shall be ineffective but shall not in any way invalidate or
affect any other clause, paragraph, section or part of this Agreement.

 

20.             
Executive acknowledges that he is not subject to any agreement which would in any way restrict him from carrying out his
employment as contemplated hereunder.

 

21.             
This agreement supersedes any prior employment agreement.

 

IN WITNESS WHEREOF, the parties
hereto have caused this Agreement to be duly executed as of the day in year first above written.

 

	 	TSR, INC.
	 	 	 
	 	By: 	/s/ J.F. Hughes
	 	 	Name: J.F. Hughes
	 	 	Title: President
	 	 	 
	 	 	 
	 	 	/s/ John G. Sharkey
	 	 	John G. Sharkey

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