Document:

Exhibit
10.1

 

FORM
OF SECURITIES PURCHASE AGREEMENT

 

THIS
PURCHASE AGREEMENT (“Agreement”) is made as of the 2nd day of January, 2018 by and between PositiveID
Corp.,(the “Company”), and GHS Investments, LLC (the “Investor”).

 

Recitals

 

A.
The Investor wishes to purchase from the Company and the Company wishes to sell and issue to the Investor, upon the terms and
conditions stated in this Agreement:

 

Up
to $82,500 of Convertible Securities, in the form of a Secured Convertible Promissory Note (the “Note”), attached
hereto. Upon the Closing Date (as defined below) Investor shall cause $75,000 to be wired to the Company or its designee.

In
consideration of the mutual promises made herein and for other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereto agree as follows:

 

1.
Definitions. In addition to those terms defined above and elsewhere in this Agreement, for the purposes of this Agreement,
the following terms shall have the meanings set forth below:

 

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

 

“Company’s
Knowledge” means the actual knowledge of the executive officers (as defined in Rule 405 under the 1933 Act) of the Company,
after due inquiry.

 

“Confidential
Information” means trade secrets, confidential information and know-how (including but not limited to ideas, formulae,
compositions, processes, procedures and techniques, research and development information, computer program code, performance specifications,
support documentation, drawings, specifications, designs, business and marketing plans, and customer and supplier lists and related
information).

 

    	 

    	 

    

 

“Control”
(including the terms “controlling”, “controlled by” or “under common control with”) means
the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of a Person,
whether through the ownership of voting securities, by contract or otherwise.

 

“Intellectual
Property” means all of the following: (i) patents, patent applications, patent disclosures and inventions (whether or
not patentable and whether or not reduced to practice); (ii) trademarks, service marks, trade dress, trade names, corporate names,
logos, slogans and Internet domain names, together with all goodwill associated with each of the foregoing; (iii) copyrights and
copyrightable works; (iv) registrations, applications and renewals for any of the foregoing; and (v) proprietary computer software
(including but not limited to data, data bases and documentation).

 

“Material
Adverse Effect” means a material adverse effect on (i) the assets, liabilities, results of operations, condition (financial
or otherwise), business, or prospects of the Company and its Subsidiaries taken as a whole, or (ii) the ability of the Company
to perform its obligations under the Transaction Documents.

 

“Person”
means an individual, corporation, partnership, limited liability company, trust, business trust, association, joint stock company,
joint venture, sole proprietorship, unincorporated organization, governmental authority or any other form of entity not specifically
listed herein.

 

“Purchase
Price” means Seventy-Five Thousand Dollars ($75,000) representing a ten percent (10%) original issuance discount on
the Note to offset transaction, diligence and legal costs.

 

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

 

“Securities”
means the Note and the common shares issuable at conversion.

 

“Subsidiary”
of any Person means another Person, an amount of the voting securities, other voting ownership or voting partnership interests
of which is sufficient to elect at least a majority of its Board of Directors or other governing body (or, if there are no such
voting interests, 50% or more of the equity interests of which) is owned directly or indirectly by such first Person.

 

“Transaction
Documents” means this Agreement, the Note, the Company Representation Letter, the Security Agreement and supporting
documents.

 

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

 

    	 	 -2-	 

    	 

    

 

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

 

2.
Purchase and Sale of the Securities. Subject to the terms and conditions of this Agreement, the Company shall sell and
issue to the Investor a Convertible Note in the principal amount of $82,500.

 

2.1
Security As security for the Company’s obligations contained herein and in all Notes issued by the Company to the
Holder, the Holder shall be granted an unconditional secured interest in and to, any and all property of the Company and its subsidiaries,
of any kind or description, tangible or intangible, whether now existing or hereafter arising or acquired until the balance of
all Notes has been reduced to $0 (See Security Agreement dated August 11, 2016). Following the Closing, the Investor is
authorized to make all filings the Investor, in its discretion, deems necessary to evidence its security interests. However such
security interest shall be behind the security interests previously in place with three other creditors as set forth in the Security
Agreement dated August 11, 2016 (“Security Agreement”).

 

3.
Closing. Upon confirmation that the other conditions to closing specified herein have been satisfied or duly waived by
the Investor, the Company shall deliver to the Investor, a Note registered the name of the Investor and the Investor shall cause
a wire transfer in same day funds to be sent to the account of the Company as instructed in writing by the Company, in an amount
representing the Purchase Price for the Note (the “Closing Date”).

 

4.
Representations and Warranties of the Company. The Company hereby represents and warrants to the Investor that, except
as set forth in the schedules delivered herewith (collectively, the “Disclosure Schedules”):

 

4.
1 Organization, Good Standing and Qualification. Each of the Company and its Subsidiaries is a corporation duly organized,
validly existing and in good standing under the laws of the jurisdiction of its incorporation and has all requisite corporate
power and authority to carry on its business as now conducted and to own its properties. Each of the Company and its Subsidiaries
is duly qualified to do business as a foreign corporation and is in good standing in each jurisdiction in which the conduct of
its business or its ownership or leasing of property makes such qualification or leasing necessary unless the failure to so qualify
has not and could not reasonably be expected to have a Material Adverse Effect. The Company’s Subsidiaries are listed on
the Company’s public disclosures filed with the SEC.

 

4.2
Authorization. The Company has full power and authority and, has taken all requisite action on the part of the Company,
its officers, directors and stockholders necessary for (i) the authorization, execution and delivery of the Transaction Documents,
(ii) authorization of the performance of all obligations of the Company hereunder or thereunder, and (iii) the authorization,
issuance (or reservation for issuance) and delivery of the Securities. The Transaction Documents constitute the legal, valid and
binding obligations of the Company, enforceable against the Company in accordance with their terms, subject to bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium and similar laws of general applicability, relating to or affecting creditors’
rights generally.

 

    	 	 -3-	 

    	 

    

 

4.3
Capitalization. As of the date hereof, the authorized capital stock of the Company on the date hereof is 20,000,000,000;
(b) the number of shares of capital stock issued and outstanding is 359,073,598; (c) the number of shares of capital stock issuable
pursuant to the Company’s stock plans is 9,315; and (d) the number of shares of capital stock issuable and reserved for
issuance pursuant to securities (other than the Securities) exercisable for, or convertible into or exchangeable for any shares
of capital stock of the Company are 18,904,706,728. All of the issued and outstanding shares of the Company’s capital stock
have been duly authorized and validly issued and are fully paid, nonassessable and free of pre-emptive rights. All of the issued
and outstanding shares of capital stock of each Subsidiary have been duly authorized and validly issued and are fully paid, nonassessable
and free of pre-emptive rights, were issued in full compliance with applicable state and federal securities law and any rights
of third parties and are owned by the Company, beneficially and of record, subject to no lien, encumbrance or other adverse claim.
No Person is entitled to pre-emptive or similar statutory or contractual rights with respect to any securities of the Company.
Other than described herein and in the Company’s periodic reports filed with the SEC, there are no outstanding warrants,
options, convertible securities or other rights, agreements or arrangements of any character under which the Company or any of
its Subsidiaries is or may be obligated to issue any equity securities of any kind and except as contemplated by this Agreement,
neither the Company nor any of its Subsidiaries is currently in negotiations for the issuance of any equity securities of any
kind.

 

The
issuance and sale of the Securities hereunder will not obligate the Company to issue shares of Common Stock or other securities
to any other Person (other than the Investor) and will not result in the adjustment of the exercise, conversion, exchange or reset
price of any outstanding security.

 

The
Company does not have outstanding stockholder purchase rights or “poison pill” or any similar arrangement in effect
giving any Person the right to purchase any equity interest in the Company upon the occurrence of certain events.

 

4.4
Valid Issuance. The issued Securities have been duly and validly authorized and, when issued and paid for pursuant to this
Agreement, shall be free and clear of all encumbrances and restrictions (other than those created by the Investor), except for
restrictions on transfer set forth in the Transaction Documents or imposed by applicable securities laws. Upon the due conversion
of the Debenture, the Converted Shares will be validly issued, fully paid and non-assessable free and clear of all encumbrances
and restrictions, except for restrictions on transfer set forth in the Transaction Documents or imposed by applicable securities
laws and except for those created by the Investor. The Company has reserved a sufficient number of shares of Common Stock for
issuance upon the exercise of the Debenture, free and clear of all encumbrances and restrictions, except for restrictions on transfer
set forth in the Transaction Documents or imposed by applicable securities laws and except for those created by the Investor.

 

    	 	 -4-	 

    	 

    

 

4.5
Consents. The execution, delivery and performance by the Company of the Transaction
Documents, and the offer, issuance and sale of the Securities require no consent of, action by or in respect of, or filing with,
any Person, governmental body, agency, or official other than filings that have been made pursuant to applicable state securities
laws, and post-sale filings pursuant to applicable state and federal securities laws which the Company undertakes to file within
the applicable time periods. Subject to the accuracy of the representations and warranties of the Investor set forth in Section
5 hereof, the Company has taken all action necessary to exempt (i) the issuance and sale of the Securities, (ii) the issuance
of the Shares upon due conversion of the Debenture, and (iii) the other transactions contemplated by the Transaction Documents
from the provisions of any shareholder rights plan or other “poison pill” arrangement, any anti-takeover, business
combination or control share law or statute binding on the Company or to which the Company or any of its assets and properties
may be subject and any provision of the Company’s Articles of Incorporation or By-laws that is or could reasonably be expected
to become applicable to the Investor as a result of the transactions contemplated hereby, including without limitation, the issuance
of the Securities and the ownership, disposition or voting of the Securities by the Investor or the exercise of any right granted
to the Investor pursuant to this Agreement or the other Transaction Documents.

 

4.6
Delivery of SEC Filings; Business. The Company has made available to the Investor through the EDGAR system, true and complete
copies of the Company’s most recent Annual Report on Form 10-K for its last fiscal year (the “10-K”), and all
other reports filed by the Company pursuant to the 1934 Act since the filing of the 10-K and prior to the date hereof (collectively,
the “SEC Filings”). The SEC Filings are the only filings required of the Company pursuant to the 1934 Act for such
period. The Company and its Subsidiaries are engaged in all material respects only in the business described in the SEC Filings
and the SEC Filings contain a complete and accurate description in all material respects of the business of the Company and its
Subsidiaries, taken as a whole.

 

4.7
Use of Proceeds. The net proceeds of the sale of the Note hereunder shall be used by the Company for working capital and
general corporate purposes. The Company agrees that it shall not use the funds from this Agreement, at any time, to lend money,
give credit or make advances to any officers, directors, employees, subsidiaries and affiliates of the Company.

 

4.8
No Conflict, Breach, Violation or Default. The execution, delivery and performance of the Transaction Documents by the
Company and the issuance and sale of the Securities will not conflict with or result in a breach or violation of any of the terms
and provisions of, or constitute a default under (i) the Company’s Articles of Incorporation or the Company’s Bylaws,
both as in effect on the date hereof (true and complete copies of which have been made available to the Investor through the EDGAR
system), or (ii)(a) any statute, rule, regulation or order of any governmental agency or body or any court, domestic or foreign,
having jurisdiction over the Company, any Subsidiary or any of their respective assets or properties, or (b) any agreement or
instrument to which the Company or any Subsidiary is a party or by which the Company or a Subsidiary is bound or to which any
of their respective assets or properties is subject.

 

    	 	 -5-	 

    	 

    

 

4.9
Brokers and Finders. No Person will have, as a result of the transactions contemplated by the Transaction Documents, any
valid right, interest or claim against or upon the Company, any Subsidiary or an Investor for any commission, fee or other compensation
pursuant to any agreement, arrangement or understanding entered into by or on behalf of the Company.

 

4.10
No Directed Selling Efforts or General Solicitation. Neither the Company nor any Person acting on its behalf has conducted
any general solicitation or general advertising (as those terms are used in Regulation D) in connection with the offer or sale
of any of the Securities.

 

4.11
No Integrated Offering. Neither the Company nor any of its Affiliates, nor any Person acting on its or their behalf has,
directly or indirectly, made any offers or sales of any Company security or solicited any offers to buy any security, under circumstances
that would adversely affect reliance by the Company on Section 4(2) for the exemption from registration for the transactions contemplated
hereby or would require registration of the Securities under the 1933 Act.

 

4.12
Private Placement. The offer and sale of the Securities to the Investor as contemplated hereby is exempt from the registration
requirements of the 1933 Act.

 

5.
Representations and Warranties of the Investor. The Investor hereby represents and warrants to the Company that:

 

5.1
Organization and Existence. Such Investor is a validly existing corporation, limited partnership or limited liability company
and has all requisite corporate, partnership or limited liability company power and authority to invest in the Securities pursuant
to this Agreement.

 

5.2
Authorization. The execution, delivery and performance by such Investor of the Transaction Documents to which such Investor
is a party have been duly authorized and will each constitute the valid and legally binding obligation of such Investor, enforceable
against such Investor in accordance with their respective terms, subject to bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium and similar laws of general applicability, relating to or affecting creditors’ rights generally.

 

5.3
Purchase Entirely for Own Account. The Securities to be received by such Investor hereunder will be acquired for such Investor’s
own account, not as nominee or agent, and not with a view to the resale or distribution of any part thereof in violation of the
1933 Act, and such Investor has no present intention of selling, granting any participation in, or otherwise distributing the
same in violation of the 1933 Act without prejudice, however, to such Investor’s right
at all times to sell or otherwise dispose of all or any part of such Securities in compliance with applicable federal and state
securities laws. Nothing contained herein shall be deemed a representation or
warranty by such Investor to hold the Securities for any period of time. Such Investor is not a broker-dealer registered
with the SEC under the 1934 Act or an entity engaged in a business that would require it to be so registered.

 

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5.4
Investment Experience. Such Investor acknowledges that it can bear the economic risk and complete loss of its investment
in the Securities and has such knowledge and experience in financial or business matters that it is capable of evaluating the
merits and risks of the investment contemplated hereby.

 

5.5
Disclosure of Information. Such Investor has had an opportunity to receive all information related to the Company requested
by it and to ask questions of and receive answers from the Company regarding the Company, its business and the terms and conditions
of the offering of the Securities. Such Investor acknowledges receipt of copies of the SEC Filings. Neither such inquiries nor
any other due diligence investigation conducted by such Investor shall modify, amend or affect such Investor’s right to
rely on the Company’s representations and warranties contained in this Agreement.

 

5.6
Restricted Securities. Such Investor understands that the Securities are characterized as “restricted securities”
under the U.S. federal securities laws inasmuch as they are being acquired from the Company in a transaction not involving a public
offering and that under such laws and applicable regulations such securities may be resold without registration under the 1933
Act only in certain limited circumstances.

 

5.7
Legends. It is understood that, except as provided below, certificates evidencing the Securities may bear the following
or any similar legend:

 

(a)
“The securities represented hereby may not be transferred unless (i) such securities have been registered for sale pursuant
to the Securities Act of 1933, as amended, (ii) such securities may be sold pursuant to Rule 144(i), or (iii) the Company has
received an opinion of counsel reasonably satisfactory to it that such transfer may lawfully be made without registration under
the Securities Act of 1933 or qualification under applicable state securities laws.”

 

(b)
If required by the authorities of any state in connection with the issuance of sale of the Securities, the legend required by
such state authority.

 

5.8
Accredited Investor. Such Investor is an accredited investor as defined in Rule 501(a) of Regulation D, as amended, under
the 1933 Act.

 

5.9
No General Solicitation. Such Investor did not learn of the investment in the Securities as a result of any public advertising
or general solicitation.

 

5.10
Brokers and Finders. No Person will have, as a result of the transactions contemplated by the Transaction Documents, any
valid right, interest or claim against or upon the Company, any Subsidiary or an Investor for any commission, fee or other compensation
pursuant to any agreement, arrangement or understanding entered into by or on behalf of such Investor.

 

    	 	 -7-	 

    	 

    

 

6.
Conditions to Closing.

 

6.1
Conditions to the Investor’s Obligations. The obligation of the Investor to purchase the Note at Closing is subject
to the fulfillment to such Investor’s satisfaction, on or prior to the Closing Date, of the following conditions, any of
which may be waived by the Investor:

 

(a)
The representations and warranties made by the Company in Section 4 hereof qualified as to materiality shall be true and correct
at all times prior to and on the Closing Date, except to the extent any such representation or warranty expressly speaks as of
an earlier date, in which case such representation or warranty shall be true and correct as of such earlier date, and, the representations
and warranties made by the Company in Section 4 hereof not qualified as to materiality shall be true and correct in all material
respects at all times prior to and on the Closing Date, except to the extent any such representation or warranty expressly speaks
as of an earlier date, in which case such representation or warranty shall be true and correct in all material respects as of
such earlier date. The Company shall have performed in all material respects all obligations and conditions herein required to
be performed or observed by it on or prior to the Closing Date.

 

(b)
The Company shall have obtained any and all consents, permits, approvals, registrations and waivers necessary or appropriate for
consummation of the purchase and sale of the Securities, and the consummation of the other transactions contemplated by the Transaction
Documents, all of which shall be in full force and effect.

 

(c)
No judgment, writ, order, injunction, award or decree of or by any court, or judge, justice or magistrate, including any bankruptcy
court or judge, or any order of or by any governmental authority, shall have been issued, and no action or proceeding shall have
been instituted by any governmental authority, enjoining or preventing the consummation of the transactions contemplated hereby
or in the other Transaction Documents.

 

(d)
The Company shall have executed and delivered the Convertible Note and supporting documentation.

 

(e)
The Company shall have executed and delivered the Irrevocable Transfer Agent Instructions.

 

(f)
No stop order or suspension of trading shall have been imposed by the public markets on which the Company’s common stock
is traded or quoted, the SEC or any other governmental or regulatory body with respect to public trading in the Common Stock.

 

6.2
Conditions to Obligations of the Company. The Company’s obligation to sell and issue the Note at Closing is subject
to the fulfillment to the satisfaction of the Company on or prior to the Closing Date of the following conditions, any of which
may be waived by the Company:

 

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(a)
The representations and warranties made by the Investor in Section 5 hereof, other than the representations and warranties contained
in Sections 5.3, 5.4, 5.5, 5.6, 5.7, 5.8 and 5.9 (the “Investment Representations”), shall be true and correct in
all material respects when made, and shall be true and correct in all material respects on the Closing Date with the same force
and effect as if they had been made on and as of said date. The Investment Representations shall be true and correct in all respects
when made, and shall be true and correct in all respects on the Closing Date with the same force and effect as if they had been
made on and as of said date. The Investor shall have performed in all material respects all obligations and conditions herein
required to be performed or observed by them on or prior to the Closing Date.

 

(b)
The Investor shall have delivered the Purchase Price to the Company in accordance with the schedule outlined herein.

 

6.3
Termination of Obligations to Effect Closing; Effects.

 

(a)
The obligations of the Company, on the one hand, and the Investor, on the other hand, to effect the Closing shall terminate as
follows:

 

(i)
Upon the mutual written consent of the Company and the Investor;

 

(ii)
By the Company if any of the conditions set forth in Section 6.2 shall have become incapable of fulfillment, and shall not have
been waived by the Company;

 

(iii)
By the Investor if any of the conditions set forth in Section 6.1 shall have become incapable of fulfillment, and shall not have
been waived by the Investor; orprovided, however, that, except in the case of clause (i) above, the party seeking to terminate
its obligation to effect the Closing shall not then be in breach of any of its representations, warranties, covenants or agreements
contained in this Agreement or the other Transaction Documents if such breach has resulted in the circumstances giving rise to
such party’s seeking to terminate its obligation to effect the Closing.

 

7.
Survival and Indemnification.

 

7.1
Survival. The representations, warranties, covenants and agreements contained in this Agreement shall survive the Closing
of the transactions contemplated by this Agreement.

 

7.2
Indemnification. The Company agrees to indemnify and hold harmless each Investor and its Affiliates and their respective
directors, officers, employees and agents from and against any and all losses, claims, damages, liabilities and expenses (including
without limitation reasonable attorney fees and disbursements and other expenses incurred in connection with investigating, preparing
or defending any action, claim or proceeding, pending or threatened and the costs of enforcement thereof) (collectively, “Losses”)
to which such Person may become subject as a result of any breach of representation, warranty, covenant or agreement made by or
to be performed on the part of the Company under the Transaction Documents, and will reimburse any such Person for all such amounts
as they are incurred by such Person.

 

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7.3
Conduct of Indemnification Proceedings. Promptly after receipt by any Person (the “Indemnified
Person”) of notice of any demand, claim or circumstances which would or might give rise to a claim or the commencement of
any action, proceeding or investigation in respect of which indemnity may be sought pursuant to Section 7.2, such Indemnified
Person shall promptly notify the Company in writing and the Company shall assume the defense thereof, including the employment
of counsel reasonably satisfactory to such Indemnified Person, and shall assume the payment of all fees and expenses; provided,
however,that the failure of any Indemnified Person so to notify the Company shall not relieve the Company of its obligations
hereunder except to the extent that the Company is materially prejudiced by such failure to notify. In any such proceeding, any
Indemnified Person shall have the right to retain its own counsel, but the fees and expenses of such counsel shall be at the expense
of such Indemnified Person unless: (i) the Company and the Indemnified Person shall have mutually agreed to the retention of such
counsel; or (ii) in the reasonable judgment of counsel to such Indemnified Person representation of both parties by the same counsel
would be inappropriate due to actual or potential differing interests between them. The Company shall not be liable for any settlement
of any proceeding effected without its written consent, which consent shall not be unreasonably withheld, but if settled with
such consent, or if there be a final judgment for the plaintiff, the Company shall indemnify and hold harmless such Indemnified
Person from and against any loss or liability (to the extent stated above) by reason of such settlement or judgment. Without the
prior written consent of the Indemnified Person, which consent shall not be unreasonably withheld, the Company shall not affect
any settlement of any pending or threatened proceeding in respect of which any Indemnified Person is or could have been a party
and indemnity could have been sought hereunder by such Indemnified Party, unless such settlement includes an unconditional release
of such Indemnified Person from all liability arising out of such proceeding.

 

8.
Miscellaneous.

 

8.1
Successors and Assigns. This Agreement may not be assigned by a party hereto without the prior written consent of the Company
or the Investor, as applicable, provided, however, that an Investor may assign its rights and delegate its duties hereunder in
whole or in part to an Affiliate or to a third party acquiring some or all of its Securities in a private transaction without
the prior written consent of the Company, after notice duly given by such Investor to the Company. The provisions 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.

 

    	 	 -10-	 

    	 

    

 

8.2
Counterparts; 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.

 

8.3
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.

 

8.4
Notices. Unless otherwise provided, any notice required or permitted under this Agreement shall be given in writing and
shall be deemed effectively given as hereinafter described (i) if given by personal delivery, then such notice shall be deemed
given upon such delivery, (ii) if given by fax, then such notice shall be deemed given upon receipt of confirmation of complete
transmittal, (iii) if given by mail, then such notice shall be deemed given upon the earlier of (A) receipt of such notice by
the recipient or (B) three days after such notice is deposited in first class mail, postage prepaid, and (iv) if given by an internationally
recognized overnight air courier, then such notice shall be deemed given one business day after delivery to such carrier. All
notices shall be addressed to the party to be notified at the address as follows, or at such other address as such party may designate
by ten days’ advance written notice to the other party:

 

If
to the Company:

 

_______________________

_______________________

Attn:
__________________

 

Fax:
__________________

Tel:
__________________

 

If
to the Investor:

 

GHS
Investments, LLC

420
Jericho Turnpike, Suite 420

Jericho,
NY 11753

 

8.5
Expenses. The parties hereto shall pay their own costs and expenses in connection herewith. In the event that legal proceedings
are commenced by any party to this Agreement against another party to this Agreement in connection with this Agreement or the
other Transaction Documents, the party or parties which do not prevail in such proceedings shall severally, but not jointly, pay
their pro rata share of the reasonable attorneys’ fees and other reasonable out-of-pocket costs and expenses incurred by
the prevailing party in such proceedings.

 

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8.6
Amendments and Waivers. Any term of this Agreement may be amended and the observance of any term of this Agreement may
be waived (either generally or in a particular instance and either retroactively or prospectively), only with the written consent
of the Company and the Investor. Any amendment or waiver effected in accordance with this paragraph shall be binding upon each
holder of any Securities purchased under this Agreement at the time outstanding, each future holder of all such Securities, and
the Company.

 

8.7
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 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 provision hereof prohibited or unenforceable in any respect.

 

8.8
Entire Agreement. This Agreement, including the Exhibits and the Disclosure Schedules, and the other Transaction Documents
constitute the entire agreement among the parties hereof with respect to the subject matter hereof and thereof and supersede all
prior agreements and understandings, both oral and written, between the parties with respect to the subject matter hereof and
thereof.

 

8.9
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.

 

8.10
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 Nevada, without regard to principles of conflicts of law. Each of the parties hereto irrevocably
submit to the exclusive jurisdiction of any United States Federal court sitting in New York State over any action or proceeding
arising out of or relating to this Agreement and the parties hereto hereby irrevocably agree that all claims in respect of such
action or proceeding may be heard and determined in such Federal court. The parties hereto agree that a final judgment in any
such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other
manner provided by law. The parties hereto further waive any objection to venue in the State of New York and any objection to
an action or proceeding in the State of New York on the basis of forum non conveniens.

 

[signature
page follows]

 

    	 	 -12-	 

    	 

    

 

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:	PositiveID
    Corp.
	 	 	 
	 	By:	 
	 	Name:	 
    
	 	Title:	 
	 	 	 
	The
    Investor:	GHS
    Investments, LLC.
	 	 	 
	 	By:	 
	 	 	Member

 

    	 	 -13-Exhibit 10.1

 

EMPLOYMENT AGREEMENT

 

This sets forth the terms
of the Employment Agreement made as of January 1, 2018 between (i) COMMUNITY BANK SYSTEM, INC., a Delaware corporation and registered
bank holding company (“CBSI”), and COMMUNITY BANK, N.A., a national banking association (“CBNA”), both
having offices in DeWitt, New York (collectively, the “Employer”), and (ii) MARK E. TRYNISKI, an individual currently
residing at 1964 Penfold Way, Baldwinsville, New York (“Employee”). This Agreement is effective as of January 1, 2018
and supersedes the Employment Agreement between the parties dated as of January 1, 2015.

 

WITNESSETH

 

IN CONSIDERATION of the promises
and mutual agreements and covenants contained herein, and other good and valuable consideration, the parties agree as follows:

 

1.           Employment.

 

(a)          Term.
Employer shall continue to employ Employee, and Employee shall continue to serve, as President and Chief Executive Officer of Employer
for a term commencing on January 1, 2018 and ending on December 31, 2020 (“Period of Employment”), subject to termination
as provided in paragraph 3 hereof.

 

(b)          Salary.
During the Period of Employment, Employer shall pay Employee a base salary at an annual rate of not less than $800,000 (“Base
Salary”). Employee’s Base Salary shall be reviewed and adjusted in accordance with Employer’s regular payroll
practices for executive employees. Employee’s Base Salary is payable in accordance with Employer’s regular payroll
practices for executive employees.

 

     

     

    

 

(c)          Incentive
Compensation. During the Period of Employment, Employee shall be entitled to annual incentive compensation opportunities pursuant
to the terms of the Management Incentive Plan, which has been approved by the Board of Directors of Employer to cover Employee
and other key personnel of Employer, as well as other incentive plans that may be established by Employer. Upon termination of
Employee’s employment pursuant to subparagraph 3(a), 3(b), 3(c) or 6, Employee shall be entitled to a pro rata portion (based
on Employee’s complete months of active employment in the applicable year) of the annual incentive awards that are payable
with respect to the year during which the termination occurs or, if the annual awards for such year are not determinable at the
time of termination, then the immediately prior year’s awards shall be used to determine such pro rata portion.

 

2.           Duties
during the Period of Employment. Employee shall have responsibility, subject to the control of Employer’s Board of Directors
for the supervision of all aspects of Employer’s business and operations, and the discharge of such other duties and responsibilities
to Employer, not inconsistent with such position, as may from time to time be reasonably assigned to Employee by Employer’s
Board of Directors. Employee shall report to Employer’s Board of Directors. Employee shall devote Employee’s best efforts
to the affairs of Employer, serve faithfully and to the best of Employee’s ability and devote all of Employee’s working
time and attention, knowledge, experience, energy and skill to the business of Employer, except that Employee may affiliate with
professional associations, and business, civic and charitable organizations; provided that such affiliations are not inconsistent
with and do not interfere with the performance of Employee’s duties under this Agreement. Consistent with CBSI’s Corporate
Governance Guidelines, Employee shall advise, and obtain the consent of, the Chair of the Board and Chair of the Nominating and
Corporate Governance Committee prior to accepting a position on another public company board of directors. Employee shall be appointed
to serve as a Director of Community Bank System, Inc. and Community Bank, NA, provided that such appointment and subsequent re-nomination
to serve as a Director shall be subject to (i) Employee being qualified to serve under applicable law, regulations, and the
Employer’s bylaws, and (ii) the exercise of the fiduciary duties of the Employer’s Board of Directors and nominating
committee of the Board of Directors. Employee shall serve on the Board of Directors of, or as an officer of Employer’s affiliates,
without additional compensation if requested to do so by the Board of Directors of Employer. Employee shall receive only the compensation
and other benefits described in this Agreement for Employee’s duties as a Director of Employer or any of its affiliates.

 

    	 	2	 

     

    

 

3.           Termination.
Employee’s employment by Employer shall be subject to termination as follows:

 

(a)          Expiration
of the Term. This Agreement shall terminate automatically at the expiration of the Period of Employment unless the parties
enter into a written agreement extending Employee’s employment, except for the continuing obligations of the parties as specified
hereunder.

 

(b)          Termination
Upon Death. This Agreement shall terminate upon Employee’s death. In the event this Agreement is terminated as a result
of Employee’s death, Employer shall continue payments of Employee’s Base Salary for a period of 90 days following Employee’s
death to the beneficiary designated by Employee on the “Beneficiary Designation Form” attached to this Agreement as
Appendix A. Any restrictions on shares of CBSI stock previously granted to Employee shall be waived as of the date of death, and
Employee’s beneficiary shall be free to dispose of any restricted stock previously granted to Employee by Employer. Additionally,
Employer shall treat as immediately exercisable all unexpired stock options issued by Employer and held by Employee that are not
exercisable or that have not been exercised, so as to permit Employee’s beneficiary to purchase the balance of CBSI stock
not yet purchased pursuant to said options until the end of the full exercise period provided in the original grant of the option
right, determined without regard to Employee’s death or termination of employment.

 

    	 	3	 

     

    

 

(c)          Termination
Upon Disability. Employer may terminate this Agreement upon Employee’s disability. For the purpose of this Agreement,
Employee’s inability to perform substantially all of Employee’s duties under this Agreement by reason of physical or
mental illness or injury for a period of 26 successive weeks (the “Disability Period”) shall constitute disability.
The determination of disability shall be made by a physician selected by Employer and a physician selected by Employee; provided,
however, that if the two physicians so selected shall disagree, the determination of disability shall be submitted to arbitration
in accordance with the rules of the American Arbitration Association and the decision of the arbitrator shall be binding and conclusive
on Employee and Employer. During the Disability Period, Employee shall be entitled to 100% of Employee’s Base Salary otherwise
payable during that period, reduced by all other Employer-provided income replacement benefits to which Employee may be entitled
for the Disability Period on account of such disability (including, but not limited to, benefits provided under any disability
insurance policy or program, workers’ compensation law, or any other benefit program or arrangement). Upon termination pursuant
to this disability provision, any restrictions on shares of CBSI stock previously granted to Employee shall be waived and Employee
shall be free to dispose of any restricted stock granted to Employee. Additionally, Employer shall treat as immediately exercisable
all unexpired stock options issued by Employer and held by Employee that are not exercisable or that have not been exercised, so
as to permit the Employee to purchase the balance of CBSI stock not yet purchased pursuant to said options until the end of the
full exercise period provided in the original grant of the option right, determined without regard to Employee’s disability
or termination of employment.

 

    	 	4	 

     

    

 

(d)          Termination
for Cause. Employer may terminate Employee’s employment immediately for “cause” by written notice to Employee.
For purposes of this Agreement, a termination shall be for “cause” if the termination results from any of the following
events:

 

(i)          Employee’s
willful breach of any material provision of this Agreement, which breach Employee shall have failed to cure within thirty (30)
days following Employer’s written notice to Employee specifying the nature of the breach;

 

(ii)         Any
documented misconduct by Employee as an executive or director of Employer, or any subsidiary or affiliate of Employer for which
Employee is performing services hereunder, which is material and adverse to the interests, monetary or otherwise, of Employer or
any subsidiary or affiliate of Employer;

 

(iii)        Unreasonable
neglect or refusal to perform the duties assigned to Employee under or pursuant to this Agreement, unless cured within thirty (30)
days following Employer’s written notice to Employee specifying the nature of the neglect or refusal;

 

(iv)        Conviction
of a crime involving any act of dishonesty or moral turpitude, or the commission of a felony;

 

    	 	5	 

     

    

 

(v)         Adjudication
as a bankrupt, which adjudication has not been contested in good faith, unless bankruptcy is caused directly by Employer’s
unexcused failure to perform its obligations under this Agreement;

 

(vi)        Documented
failure to follow the reasonable, written instructions of the Board of Directors of Employer, provided that the instructions do
not require Employee to engage in unlawful conduct; or

 

(vii)       A
willful violation of a material rule or regulation of the Office of the Comptroller of the Currency or of any other regulatory
agency governing Employer or any subsidiary or affiliate of Employer.

 

Notwithstanding any other
term or provision of this Agreement to the contrary, if Employee’s employment is terminated for cause, Employee shall forfeit
all rights to payments and benefits otherwise provided pursuant to this Agreement; provided, however, that Base Salary shall be
paid through the date of termination.

 

(e)          Termination
For Reasons Other Than Cause. In the event Employer terminates Employee’s employment during the Period of Employment
or within 24 months following the expiration of the Period of Employment for reasons other than “cause” (as defined
in paragraph 3(d)), or in the event that Employee terminates his employment with Employer during the Period of Employment for “good
reason” (as defined in, and subject to the notice and right to cure provisions in, paragraph 6(d)), then Employee shall be
entitled to a severance benefit equal to the greater of (i) 200 percent of the sum of Employee’s annual Base Salary in effect
at the time of termination and the aggregate sum of all payments made to Employee during the 12 months preceding Employee’s
termination pursuant to the Management Incentive Plan (or equivalent successor plan), or (ii) amounts of Base Salary and expected
Management Incentive Plan (or equivalent successor plan) payments that otherwise would have been payable through the balance of
the unexpired term of this Agreement. Unless Employee is a “specified employee” (as determined in accordance with Internal
Revenue Code Section 409A), the benefit payable pursuant to this paragraph 3(e) shall be payable in equal biweekly installments
over the 12-month period that begins on the first day of the month following Employee’s termination. If Employee is a “specified
employee” (as determined in accordance with Internal Revenue Code Section 409A), then installment payments during the first
six months of the 12-month installment period shall be limited to the extent required by Internal Revenue Code Section 409A, any
unpaid installment amounts shall be paid immediately after such six-month period and installment payments due during the remaining
six months shall be paid as scheduled.

 

    	 	6	 

     

    

 

In addition to the cash
benefits described in the foregoing of this paragraph 3(e), Employer shall waive all restrictions on all CBSI stock previously
granted to Employee and permit Employee to dispose of any such restricted stock, as well as treat as immediately exercisable all
unexpired stock options held by Employee that are not exercisable or that have not been exercised, so as to permit Employee to
purchase the balance of CBSI stock not yet purchased pursuant to said options until the end of the full exercise period provided
in the original grant of the option right determined without regard to Employee’s termination of employment.

 

Notwithstanding the foregoing,
amounts payable under clauses (i) or (ii) of this paragraph 3(e) shall be reduced by any payments made to Employee under paragraph
6(a)(i) of this Agreement. Payments under this paragraph 3(e) and payments under paragraph 6(a)(i) shall not be duplicated.

 

    	 	7	 

     

    

 

4.           Fringe
Benefits.

 

(a)          Benefit
Plans. During the Period of Employment, Employee shall be eligible to participate in any employee pension benefit plans (as
that term is defined under Section 3(2) of the Employee Retirement Income Security Act of 1974, as amended), Employer-paid group
life insurance plans, medical plans, dental plans, long-term disability plans, business travel insurance programs and other fringe
benefit programs maintained by Employer for the benefit of (or which are applicable to) its executive employees. Participation
in any of Employer’s benefit plans and programs shall be based on, and subject to satisfaction of, the eligibility requirements
and other conditions of such plans and programs. Employer may require Employee to submit to an annual physical, to be performed
by a physician of his own choosing. Employee shall not be eligible to participate in Employer’s Severance Pay Plan maintained
for other employees not covered by employment agreements.

 

(b)          Expenses.
Upon submission to Employer of vouchers or other required documentation, Employee shall be reimbursed for (or Employer shall pay
directly) Employee’s actual out-of-pocket travel and other expenses reasonably incurred and paid by Employee in connection
with Employee’s duties hereunder. Reimbursable expenses must be submitted to the Compensation Committee of the Board of Directors
of Employer for review on no less than an annual basis.

 

(c)          Other
Benefits. During the Period of Employment, Employee also shall be entitled to receive the following benefits:

 

(i)          Paid
time-off of twenty-one (21) days each calendar year (with no carry-over of unused time to a subsequent year) and any holidays that
may be provided to all employees of Employer in accordance with Employer’s holiday policy;

 

    	 	8	 

     

    

 

(ii)         Reasonable
sick leave;

 

(iii)        Reimbursement
of membership fees and dues (but not personal expenses) for up to two club memberships and other appropriate professional associations,
subject to the approval of the Compensation Committee of the Board of Directors of Employer, the primary purpose of which memberships
shall be the promotion of Employer’s business interests. Reimbursements shall be made on or before the last day of Employee’s
taxable year following the taxable year in which the expense was incurred;

 

(iv)        The
use of an Employer-owned automobile, the purchase and replacement of which shall be subject to the approval of the Compensation
Committee of the Board of Directors of Employer; and

 

(v)         The
use of an Employer-owned mobile telephone and the payment or reimbursement of all Employer-related business charges incurred in
connection with the use of such telephone.

 

(d)          Supplemental
Retirement Benefits. The terms and conditions for the payment of supplemental retirement benefits are set forth in a separate
written agreement between the parties.

 

5.           Restricted
Stock and Stock Options. Employer shall cause the Compensation Committee of the Board of Directors of Employer to review whether
Employee should be granted shares of restricted stock and/or options to purchase shares of common stock of CBSI. Such review may
be conducted pursuant to the terms of the Community Bank System, Inc. 2014 Long-Term Incentive Plan, a successor plan, or independently,
as the Compensation Committee shall determine. Reviews shall be conducted no less frequently than annually.

 

    	 	9	 

     

    

 

6.           Change
of Control.

 

(a)          If
Employee’s employment with Employer shall cease for any reason, including Employee’s voluntary termination for “good
reason” (as defined in paragraph 6(d) below), but not including Employee’s termination for “cause” (as
described in paragraph 3(d)) or Employee’s voluntary termination without “good reason”, within two years following
a “Change of Control” that occurs during the Period of Employment, then:

 

(i)          Employer
shall pay to the Employee the greater of (A) 300 percent of the sum of the annual Base Salary in effect at the time of Employee’s
termination and the aggregate sum of all payments made to Employee during the 12 months preceding Employee’s termination
pursuant to the Management Incentive Plan (or equivalent successor plan), or (B) amounts of Base Salary and expected payments under
the Management Incentive Plan (or equivalent successor plan) that otherwise would have been payable through the balance of the
unexpired term of this Agreement. Unless Employee is a “specified employee” (as determined in accordance with Internal
Revenue Code Section 409A), the amount determined pursuant to this paragraph 6(a)(i) shall be payable in equal biweekly installments
over the 12-month period that begins on the first day of the month following Employee’s termination. If Employee is a “specified
employee” (as determined in accordance with Internal Revenue Code Section 409A), then installment payments during the first
six months of the 12-month installment period shall be limited to the extent required by Internal Revenue Code Section 409A, any
unpaid installment amounts shall be paid immediately after such six-month period and installment payments due during the remaining
six months shall be paid as scheduled.

 

    	 	10	 

     

    

 

(ii)         Employer
shall provide Employee with the cash equivalents of the benefits described in paragraph 4(a) for a period of 36 months following
Employee’s termination. Unless Employee is a “specified employee” (as determined in accordance with Internal
Revenue Code Section 409A), the cash equivalents payable pursuant to this subparagraph (ii) shall be payable in equal monthly installments
over the 36-month period that begins on the first day of the month following Employee’s separation from service. If Employee
is a “specified employee” (as determined in accordance with Internal Revenue Code Section 409A), then installment payments
during the first six months of the 36-month installment period shall be limited to the extent required by Internal Revenue Code
Section 409A, any unpaid installment amounts shall be paid immediately after such six-month period and installment payments due
during the remaining 30 months shall be paid as scheduled.

 

(iii)        Employer
shall treat as immediately exercisable all unexpired stock options issued by Employer and held by Employee that are not otherwise
exercisable or that have not been exercised so as to permit Employee to purchase the balance of CBSI stock not yet purchased pursuant
to said options until the end of the full exercise period provided in the original grant of the option right, determined without
regard to Employee’s termination of employment.

 

(iv)        Employer
shall waive all restrictions on any shares of CBSI stock granted to Employee and permit Employee to dispose of such stock.

 

(b)          Notwithstanding
any provision of this Agreement to the contrary, in the event that any payment or benefit received or to be received by the Employee
in connection with a Change of Control (whether pursuant to the terms of this Agreement or any other plan, arrangement or agreement)
(all such payments and benefits being hereinafter called “Total Benefits”) would be subject (in whole or part) to the
excise tax imposed pursuant to Internal Revenue Code Section 4999, then the cash severance payments provided in this Agreement
shall first be reduced, and the other payments and benefits hereunder shall thereafter be reduced, to the extent necessary so that
no portion of the Total Benefits will be subject to such excise tax, but only if (i) is greater than or equal to (ii), where (i)
equals the reduced amount of such Total Benefits minus the aggregate amount of federal, state and local income taxes on such reduced
Total Benefits, and (ii) equals the unreduced amount of such Total Benefits minus the sum of (A) the aggregate amount of federal,
state and local income taxes on such Total Benefits, and (B) the amount of excise tax to which the Employee would be subject in
respect of such unreduced Total Benefits.

 

    	 	11	 

     

    

 

(c)          For
purposes of this paragraph 6, a “Change of Control” shall be deemed to have occurred if:

 

(i)          any
“person,” including a “group” as determined in accordance with the Section 13(d)(3) of the Securities Exchange
Act of 1934 (“Exchange Act”), is or becomes the beneficial owner, directly or indirectly, of securities of Employer
representing 30% or more of the combined voting power of Employer’s then outstanding securities;

 

(ii)         as
a result of, or in connection with, any tender offer or exchange offer, merger or other business combination (a “Transaction”),
the persons who were directors of Employer before the Transaction shall cease to constitute a majority of the Board of Directors
of Employer or any successor to Employer;

 

(iii)        Employer
is merged or consolidated with another corporation and as a result of the merger or consolidation less than 70% of the outstanding
voting securities of the surviving or resulting corporation shall then be owned in the aggregate by the former stockholders of
Employer, other than (A) affiliates within the meaning of the Exchange Act, or (B) any party to the merger or consolidation;

 

    	 	12	 

     

    

 

(iv)        a
tender offer or exchange offer is made and consummated for the ownership of securities of Employer representing 30% or more of
the combined voting power of Employer’s then outstanding voting securities; or

 

(v)         Employer
transfers substantially all of its assets to another corporation, which is not controlled by Employer.

 

(d)          For
purposes of this paragraph 6, “good reason” shall mean action taken by Employer that results in:

 

(i)          An
involuntary and material adverse change in Employee’s authority, duties, responsibilities, or base compensation;

 

(ii)         An
involuntary and material relocation of the office from which Employee is expected to perform his duties; or

 

(iii)        A
material breach of this Agreement or any other agreement between the parties under which Employee provides services.

 

In all cases, Employee must provide notice
to Employer of the existence of a condition described in (i), (ii) or (iii) above within thirty (30) days of the initial existence
of the condition, upon the notice of which Employer shall have thirty (30) days thereafter in which to remedy the condition.

 

7.           Withholding.
Employer shall deduct and withhold from compensation and benefits provided under this Agreement all required income and employment
taxes and any other similar sums required by law to be withheld.

 

    	 	13	 

     

    

 

8.           Covenants.

 

(a)          Confidentiality.
Employee shall not, without the prior written consent of Employer, disclose or use in any way, either during his employment by
Employer or thereafter, except as required in the course of his employment by Employer, any confidential business or technical
information or trade secret acquired in the course of Employee’s employment by Employer. Employee acknowledges and agrees
that it would be difficult to fully compensate Employer for damages resulting from the breach or threatened breach of the foregoing
provision and, accordingly, that Employer shall be entitled to temporary preliminary injunctions and permanent injunctions to enforce
such provision. This provision with respect to injunctive relief shall not, however, diminish Employer’s right to claim and
recover damages. Employee covenants to use his best efforts to prevent the publication or disclosure of any trade secret or any
confidential information that is not in the public domain concerning the business or finances of Employer or Employer’s affiliates,
or any of its or their dealings, transactions or affairs which may come to Employee’s knowledge in the pursuance of his duties
or employment.

 

(b)          No
Competition. Employee’s employment is subject to the condition that during the term of his employment hereunder and for
the period specified in paragraph 8(c) below, Employee shall not, directly or indirectly, own, manage, operate, control or participate
in the ownership, management, operation or control of, or be connected as an officer, employee, partner, director, individual proprietor,
lender, consultant or otherwise with, or have any financial interest in, or aid or assist anyone else in the conduct of, any entity
or business (a “Competitive Operation”) which competes in the banking industry or with any other business conducted
by Employer or by any group, affiliate, division or subsidiary of Employer, in the same counties of New York, Pennsylvania or any
other state in which the Employer or any such group, affiliate, division or subsidiary conducts business. Employee shall keep Employer
fully advised as to any activity, interest, or investment Employee may have in any way related to the banking industry. It is understood
and agreed that, for the purposes of the foregoing provisions of this paragraph, (i) no business shall be deemed to be a business
conducted by Employer or any group, division, affiliate or subsidiary of Employer unless 5% or more of Employer’s consolidated
gross sales or operating revenues is derived from, or 5% or more of Employer’s consolidated assets are devoted to, such business;
(ii) no business conducted by any entity by which Employee is employed or in which he is interested or with which he is connected
or associated shall be deemed competitive with any business conducted by Employer or any group, division, affiliate or subsidiary
of Employer unless it is one from which 2% or more of its consolidated gross sales or operating revenues is derived, or to which
2% or more of its consolidated assets are devoted; and (iii) no business which is conducted by Employer on the date of Employee’s
termination and which subsequently is sold by Employer shall, after such sale, be deemed to be a Competitive Operation within the
meaning of this paragraph. Ownership of not more than 5% of the voting stock of any publicly held corporation shall not constitute
a violation of this paragraph.

 

    	 	14	 

     

    

 

(c)          Non-Competition
Period. The “non-competition period” shall begin on January 1, 2018 and shall end twelve (12) months after Employee’s
termination of employment; provided, however, that the “non-competition period” shall end on the date Employee’s
employment ends in the event of Employee’s termination for “good reason” (as defined in paragraph 6(d)), or Employee’s
termination without “cause” (as defined in paragraph 3(d)).

 

(d)          Non-Solicitation.
While Employee is employed by Employer, and for a period of two years after Employee’s employment with Employer ends for
any reason, Employee shall not directly or indirectly solicit (other than on behalf of Employer) business or contracts for any
products or services of the type provided, developed or under development by Employer during Employee’s employment by Employer,
from or with (x) any person or entity which was a customer of Employer for such products or services as of, or within 12 months
prior to, the date of Employee’s termination of employment with Employer, or (y) any prospective customer which Employer
was soliciting as of, or within 12 months prior to, Employee’s termination. Additionally, while Employee is employed by Employer,
and for two years after Employee’s employment with the Employer ends for any reason, Employee will not directly or indirectly
contract with any such customer or prospective customer for any product or service of the type provided, developed or which was
under development by Employer during Employee’s employment with Employer. Employee will not at any time knowingly interfere
or attempt to interfere with any transaction, agreement or business relationship in which Employer was involved or was contemplating
during Employee’s employment with Employer, including but not limited to relationships with customers, prospective customers,
agents, contractors, vendors, service providers, and suppliers.

 

    	 	15	 

     

    

 

(e)          Non-Recruitment.
While Employee is employed by Employer, and for a period of two years after Employee’s employment with Employer ends for
any reason, Employee shall not, directly or indirectly, solicit, recruit, or hire, or in any manner assist in the hiring, solicitation
or recruitment of any of individual who is or was an employee of Employer, or who otherwise provided services to Employer, within
12 months prior to the termination of Employee’s employment with Employer.

 

(f)          Termination
of Payments. Upon the breach by Employee of any covenant under this paragraph 8, Employer shall cease all payments to Employee
and may offset and/or recover from Employee immediately any and all amounts payable to Employee under this Agreement against any
damages to which Employer is legally entitled in addition to any and all other remedies available to Employer under the law or
in equity.

 

    	 	16	 

     

    

 

(g)          Resignation
as Director. In the event that Employee’s employment terminates for any reason, he shall be deemed to have immediately
tendered his resignation as a director on Employer’s (and any of Employer’s affiliates) Board of Directors, and such
Boards may accept such resignation in their discretion effective upon the termination date without further action by the Employee.

 

9.           Notices.
Any notice which may be given hereunder shall be sufficient if in writing and mailed by overnight mail, or by certified mail, return
receipt requested, to Employee at his residence and to Employer at 5790 Widewaters Parkway, Dewitt, New York 13214, or at such
other addresses as either Employee or Employer may, by similar notice, designate.

 

10.          Rules,
Regulations and Policies. Employee shall abide by and comply in all material respects with all of the rules, regulations, and
policies of Employer that may be in effect and amended from time to time, including without limitation (i) Employer’s policy
of strict adherence to, and compliance with, any and all requirements of the banking, securities, and antitrust laws and regulations,
(ii) Employer’s human resources, personnel and benefits policies, and (iii) to the extent applicable, Employer’s Executive
Equity Ownership Guidelines and claw-back policy.

 

11.          No
Prior Restrictions. Employee affirms and represents that Employee is under no obligations to any former employer or other third
party which is in any way inconsistent with, or which imposes any restriction upon, the employment of Employee by Employer, or
Employee’s undertakings under this Agreement.

 

    	 	17	 

     

    

 

12.         Return
of Employer’s Property. After Employee has received notice of termination or at the end of the term hereof, whichever
first occurs, Employee shall promptly return to Employer all documents and other property in his possession belonging to Employer.

 

13.         Construction
and Severability. The invalidity of any one or more provisions of this Agreement or any part thereof, all of which are inserted
conditionally upon their being valid in law, shall not affect the validity of any other provisions to this Agreement; and in the
event that one or more provisions contained herein shall be invalid, as determined by a court of competent jurisdiction, the court
shall have authority to modify such provision in a manner that most closely reflects the intent of the parties and is valid. This
Agreement shall be interpreted and applied in all circumstances in a manner that is consistent with the intent of the parties that
amounts earned and payable pursuant to this Agreement shall not be subject to the premature income recognition or adverse tax provisions
of Internal Revenue Code Section 409A. Accordingly, by way of example and not limitation, (a) distributions of benefits payable
following Employee’s termination of employment shall commence as of the date required by this Agreement or, if later, the
earliest date permitted by Internal Revenue Code Section 409A (generally six months after termination, if Employee is a “specified
employee” within the meaning of Internal Revenue Code Section 409A), and (b) the phrase “termination of employment”
(and similar terms and phrases) shall be construed to mean “separation from service” within the meaning of Internal
Revenue Code Section 409A.

 

14.         Governing
Law. This Agreement was executed and delivered in New York and shall be construed and governed in accordance with the
laws of the State of New York.

 

    	 	18	 

     

    

 

15.         Assignability
and Successors. This Agreement may not be assigned by Employee or Employer, except that this Agreement shall be binding upon
and shall inure to the benefit of the successor of Employer through merger or corporate reorganization. Any attempted assignment
in violation of this paragraph 15 shall be null and void and of no effect.

 

16.         Miscellaneous.

 

(a)          This
Agreement constitutes the entire understanding and agreement between the parties with respect to the subject matter hereof and
shall supersede all prior understandings and agreements, including the January 1, 2015 Employment Agreement between the parties
(which agreement expires/expired on December 31, 2017).

 

(b)          This
Agreement cannot be amended, modified, or supplemented in any respect, except by a subsequent written agreement entered into by
the parties hereto.

 

(c)          The
services to be performed by Employee are special and unique; it is agreed that any breach of this Agreement by Employee shall entitle
Employer (or any successor or assigns of Employer), in addition to any other legal remedies available to it, to apply to any court
of competent jurisdiction to enjoin such breach.

 

(d)          The
provisions of paragraphs 3(e), 6 and 8 hereof shall survive the termination of this Agreement.

 

17.         Counterparts.
This Agreement may be executed in counterparts (each of which need not be executed by each of the parties), which together shall
constitute one and the same instrument.

 

18.         Jurisdiction,
Venue and Fees. The jurisdiction of any proceeding between the parties arising out of, or with respect to, this Agreement shall
be in a court of competent jurisdiction in New York State, and venue shall be in Onondaga County. Each party shall be subject to
the personal jurisdiction of the courts of New York State. If Employee is the prevailing party in a proceeding to collect payments
due pursuant to this Agreement, Employer shall reimburse Employee for reasonable attorneys’ fees incurred by Employee in
connection with such proceeding. The foregoing right to reimbursement shall expire on the fifth anniversary of Employee’s
separation from employment with Employer.

 

    	 	19	 

     

    

 

The foregoing is established
by the following signatures of the parties.

 

	 	COMMUNITY BANK SYSTEM, INC.
	 	 
	 	By:	/s/ George J. Getman
	 	Its:	Executive Vice President & General Counsel
	 	 
	 	Date:  January 5, 2018
	 	 
	 	COMMUNITY BANK, N.A.
	 	 
	 	By:	/s/ George J. Getman
	 	Its:	Executive Vice President & General Counsel
	 	 
	 	Date:  January 5, 2018
	 	 
	 	/s/ Mark E. Tryniski
	 	MARK E. TRYNISKI
	 	 
	 	Date:  January 5, 2018

 

    	 	20

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