Document:

sealandassetpurchaseagre

1 17618573v10  ASSET PURCHASE AGREEMENT  THIS ASSET PURCHASE AGREEMENT (this “Agreement”) is entered as of the ____ day of April ,  2022, by and among: (a) (i) Sealand Food, Inc., a Maryland corporation (the “Seller”), (ii) Connie Wang (“C.  Wang”), and (iii) Jenny Wang (“J. Wang”, and together with C. Wang, the “Majority Shareholders”); and (b)  and Great Wall Seafood VA, L.L.C., a Virginia limited liability company (the “Purchaser”), a direct subsidiary  of HF Foods Group Inc., a Delaware corporation (“Parent”) and, for purposes of Section 2.1(d) only, Parent.   W I T N E S S E T H: WHEREAS, the Seller markets, distributes and sells seafood and other restaurant products to  restaurants, markets and other customers throughout the United States (the “Business”);  WHEREAS, to support and facilitate the operation of the Business, certain Shareholders (as defined  below) and other Persons affiliated with the Seller incorporated and operate each of Milestone Express Inc., a  Virginia corporation (“Milestone Express”) and Express Light Trucking, Inc., a Virginia corporation (“Express  Light”, and together with Milestone Express, the “Affiliated Trucking Companies”), which such Affiliated  Trucking Companies exclusively provide transportation and distribution services to the Seller;  WHEREAS, the shareholders of the Seller (the “Shareholders”) are the owners of all of the issued and  outstanding capital stock of the Seller, in the amounts and percentages set forth next to such Shareholder’s name  on Schedule 4.5;  WHEREAS, the Majority Shareholders, collectively, own 70% of the issued and outstanding capital  stock of the Seller;   WHEREAS, the Purchaser desires to purchase from the Seller, and the Seller desires to sell to the  Purchaser, certain assets of the Seller used in the conduct of the Business, subject to the terms and conditions  set forth in this Agreement; and   WHEREAS, an index of the location of the definition of defined terms used in this Agreement is set  forth in Section 10.14 below.  NOW, THEREFORE, in consideration of the foregoing premises and the mutual representations,  warranties and covenants herein contained, and other good and valuable consideration, the receipt and  sufficiency of which are hereby acknowledged, the parties hereto hereby agree as follows:  ARTICLE 1  PURCHASE AND SALE OF PURCHASED ASSETS  1.1 Purchased Assets.  Upon the terms and subject to the conditions set forth herein, the Seller  agrees to sell, convey, assign, deliver and transfer to the Purchaser, and the Purchaser agrees to purchase from  the Seller and take possession of, at the Closing, all right, title and interest of the Seller to those assets of the  Business described below (collectively, the “Purchased Assets”), but expressly excluding the Excluded Assets: (a) Assigned Assets.  All furniture, equipment, machinery, dry area racking, ice machines, storage units, appliances, communications equipment, computer hardware and software (to the extent  assignable), tools and other fixed assets and personal property,  including, without limitation, those listed on  Schedule 1.1(a) (the “Assigned Assets”);  19th 

 

2 17618573v10  (b) Intellectual Property.  All intellectual property rights throughout the world (whether  protected, created or arising under the laws of the United States or any other jurisdiction, including all (i) patents  and pending applications therefor and all renewals, reissues, reexaminations, divisionals, continuations,  continuations in part and extensions thereof; (ii) registered or unregistered trademarks and service marks, trade  names, brand names, trade dress, logos, and all goodwill associated therewith, and all internet domain name  registrations and all applications, registrations and renewals in connection therewith; (iii) copyrights (registered  or unregistered), databases, web sites, computer source code, executable code, programs and other software  (including all machine readable code, printed listings of code, documentation and related property and  information, whether embodied in software, firmware or otherwise) and all applications, registrations and  renewals in connection therewith (if any); and (iv) trade secrets, know how, inventions, engineering, designs,  drawings, specifications, formulae, technology, processes and other confidential, proprietary, technical or  business information) (collectively, “Intellectual Property”) that are owned by the Seller (the “Owned  Intellectual Property”), including, without limitation, those items listed on or described on Schedule 1.1(b);   (c) Books and Records.  Originals or duplicate copies of all financial, accounting and  operating data and records of the Seller (wherever located, including in the possession of the Seller’s  accountants), including without limitation all books, records, sales and sales promotional data, advertising  materials, pricing information, customer and supplier lists, projections, reference catalogs, copies of all payroll  and personnel records related to all Current Employees, copies of Tax Returns and other Tax records and other  similar property, rights and information (except as set forth in Section 1.2);  (d) Assigned Contracts.  Only those Contracts that are specifically listed on  Schedule 1.1(d) (the “Assigned Contracts”);  (e) Licenses and Permits.  To the extent assignable, all of the Seller’s licenses, consents,  permits, variances, certifications and approvals of governmental agencies relating to the Business (except as set  forth in Section 1.2(a)), including, without limitation, those listed on Schedule 1.1(e);  (f) Vehicles.  All of the Seller’s and Affiliated Trucking Companies’ owned and leased  tractors, trailers, trucks and other vehicles, including, without limitation, those listed on Schedule 1.1(f)  (“Vehicles”);  (g) Certain Employee Agreements.  All confidentiality agreements, restrictive covenants  and other obligations of any employees, consultants or independent contractors of the Seller and the Affiliated  Trucking Companies;  (h) Goodwill.  All goodwill associated with the Business, including, without limitation, all  goodwill of the Shareholders related to or associated with the Business; and (i) Other Assets.  All of the Seller’s causes of action, choses in action, rights of recovery,  warranty rights, guarantees, indemnities and similar rights in respect of the Purchased Assets, and those items  listed on Schedule 1.1(i). 1.2 Excluded Assets.  The following tangible and intangible assets of the Seller shall constitute  the “Excluded Assets,” which shall not be purchased by or conveyed to the Purchaser at Closing pursuant to  this Agreement: (a) Organizational Documents; Minute Books.  The Seller’s articles of incorporation,  minute book, bylaws and stock certificates (together with any documents relating to the incorporation,  maintenance and existence of the Seller as a corporation), taxpayer and other identification numbers, originals  of the Seller’s Tax Returns and reports and Seller’s seal;  

 

3 17618573v10  (b) Employee Benefit Plans.  Any interest or right to any assets held under, and all assets  relating to or owned by, any pension, deferred compensation, profit sharing or other Employee Benefit Plan of  the Seller;  (c) Excluded Contracts. All Contracts other than the Assigned Contracts, including  those listed on Schedule 1.2(c).   (d) Cash and Securities.  All cash and cash equivalents in the Seller’s bank accounts,  checks and checkbooks, deposits and all refunds, claims, prepaid charges, sums and fees related thereto, all  lockboxes and the contents thereof as of the Closing, and all shares of stock and securities owned by the Seller;   (e) Tax.  All of the Seller’s interest in or rights to receive Tax refunds, credits and rebates  and other governmental charges for periods prior to the Closing Date, all federal and state deferred Tax assets  and the benefit of net operating loss carry forwards, carry backs or other credits of the Seller for periods or  partial periods ending on or prior to the Closing Date, and the Seller’s rights in and to any Tax deposits made  by the Seller prior to the Closing Date;  (f) Inventory.  All inventory of products for sale in the operation of the Business, which  shall be subject to purchase by Purchaser pursuant to Section 3.10 below;  (g) Accounts Receivable.  All vendor and trade accounts receivable arising from the  Business prior to the Closing Date;  (h) Insurance.  All property, casualty, product liability, and general and commercial  liability insurance policies of the Seller, and all rights thereunder, including, without limitation, all rights to  receive refunds with respect to premiums paid, but expressly excluding any and all rights to receive amounts  payable based upon claims made with respect to the Purchased Assets; and  (i) Additional Items.  Those items set forth on Schedule 1.2(i). 1.3 No Liens or Encumbrances.  The Seller and the Majority Shareholders hereby covenant and  agree with the Purchaser that the Purchased Assets will be transferred and conveyed to the Purchaser at the  Closing free and clear of all claims, liens, encumbrances, conditions, easements, restrictions, leases, security  interests, and similar interests of any kind or nature whatsoever (collectively, “Encumbrances”), other than any  (i) Encumbrances under the Assigned Contracts and disclosed on Schedule 1.3, (ii) liens for Taxes not yet due  and payable or being contested in good faith by appropriate procedures and disclosed on Schedule 1.3; (iii)  mechanics’, carriers’, workmen’s, repairmen’s or other like liens arising or incurred in the ordinary course of  business for amounts which are not delinquent and which are not, individually or in the aggregate, material;  (iv) easements, rights of way, zoning ordinances and other similar encumbrances affecting real property which  do not materially and adversely impair the occupancy or use of the Leased Real Property; and (v) other  immaterial imperfections of title or encumbrances ((i) – (v) collectively, “Permitted Encumbrances”). ARTICLE 2  PURCHASE PRICE; ASSUMPTION OF LIABILITIES  2.1 Purchase Price.  The aggregate purchase price for the Purchased Assets shall be Twenty  Million Dollars ($20,000,000.00) (the “Purchase Price”), and shall be paid by the Purchaser as follows:  (a) Closing Cash Payment. At the Closing, the Purchaser shall pay to the Seller, or to such  creditors of the Seller or other Persons as the Seller directs in writing, an amount equal to the Purchase Price  less the Escrow Amount by wire transfer of immediately available funds at the Closing (the “Closing Cash  

 

4 17618573v10  Payment”). In addition to the Closing Cash Payment, the Purchaser shall also pay to the Seller by wire transfer  of immediately available funds at the Closing, the Closing Date Inventory Payment (as defined in Section 3.10  below), which payment, for the avoidance of doubt, shall be in addition to the Purchase Price.    (b) Escrow.  On the date hereof, and in exchange for Seller’s covenant to cooperate in all  material respects with Purchaser to permit Purchaser to conduct those activities listed on Schedule 2.1(b) prior  to the Closing Date, the Purchaser shall deposit One Million Dollars ($1,000,000.00) (the “Escrow Amount”)  into an escrow account with Truist Bank, as escrow agent (“Escrow Agent”), in accordance with the terms and  conditions of the escrow agreement entered into as of the date hereof by and among Purchaser, the Seller, the  Majority Shareholders and Escrow Agent, attached hereto as Exhibit 2.1(b) (the “Escrow Agreement”). If the  Seller terminates this Agreement pursuant to Section 9.3(c) below, or if the conditions set forth in Section 9.1  hereof have been satisfied or validly waived but the Closing has not occurred pursuant to Section 2.3 hereof  Purchaser and the Seller shall cause the Escrow Agent to release the Escrow Amount to the Seller within five  (5) Business Days following the date of such termination or event, as the case may be. If the Closing occurs,  the Escrow Amount shall be utilized  as a source of funds to satisfy the Seller’s obligations under Section 3.10  and any indemnification obligations set forth in Article 6 of this Agreement as more fully described in Section  6.5 hereof.  The Escrow Agreement shall provide that, on or prior to the date that is five (5) Business Days  following the one (1) year anniversary of the Closing Date (the “Escrow Release Date”), Purchaser and the  Seller shall cause the Escrow Agent to release any then remaining portion of the Escrow Amount to the Seller,  less a portion of the Escrow Amount equal to the estimated Losses arising out of any then pending  indemnification claims by Purchaser that are subject to Notices of Claim.  Any portion of the Escrow Amount  due to be released on the Escrow Release Date that continues to be held in escrow with respect to any unresolved  Notice of Claim shall be delivered to the Seller, or Purchaser, as applicable, within five (5) Business Days  following a Final Determination of such Notice of Claim.   (c) Withholding. Purchaser shall be entitled to deduct and withhold from the Closing Cash  Payment all Taxes that Purchaser may be required to deduct and withhold under any provision of Tax Law. All  such withheld amounts shall be treated as delivered to Seller hereunder.  (d) Parent hereby guarantees the timely payment by Purchaser of the Purchase Price.  2.2 Liabilities.  (a) Assumption of Certain Liabilities.  At the Closing, the Purchaser shall assume only  those executory duties and obligations of the Seller or an Affiliated Trucking Company as a party under the  Assigned Contracts, to the extent arising from and after the Closing Date (excluding any executory duties or  obligations of the Seller or such Affiliated Trucking Company that relate to or arise from (in whole or in part)  any breach, violation or default that occurred (or, upon the giving of notice or lapse of time or both, would have  occurred) at or prior to the Closing) (collectively, the “Assumed Liabilities”).  (b) Excluded Liabilities.  Except for the Assumed Liabilities, it is expressly understood  and agreed that notwithstanding anything to the contrary contained herein, neither the Purchaser nor any of its  Affiliates (including, for the avoidance of doubt, the Parent) will assume or have any liability or obligation  whatsoever with respect to any of the Seller’s, the Affiliated Trucking Company’s or any Shareholder’s  obligations, liabilities, contracts, debts, claims, costs, expenses, agreements or understandings, of any kind or  nature whatsoever at any time existing or asserted, whether or not accrued on the Seller’s financial statements  or recorded in their respective books and records, whether fixed, contingent or otherwise, whether known or  unknown, whether arising prior to, on or after the Closing Date and whether or not relating to the operation of  the Business or the Seller’s or the Affiliated Trucking Companies; ownership or use of the Purchased Assets  prior to the Closing Date (collectively, the “Excluded Liabilities”).  Without limiting the generality of the  foregoing, the Excluded Liabilities shall include, but not be limited to, and the Seller or the Affiliated Trucking  

 

5 17618573v10  Companies shall retain, and neither the Purchaser nor its Affiliates shall assume or be liable for, the following  liabilities and obligations:  (i) Any liability or obligation for any and all Taxes of the Seller, Shareholders or  the Business (except Taxes prorated in accordance with Section 2.4), including, without limitation, (A) Taxes  arising as a result of the Seller’s operation of the Business or use or ownership of the Purchased Assets prior to  the Closing Date, (B) Taxes that will arise as a result of the sale of the Purchased Assets pursuant to this  Agreement, and (C) any deferred Taxes of any nature arising as a result of the Seller’s operation of the Business.  (ii) Any liability or obligation of the Shareholders, the Seller, any Affiliated  Trucking Company or any of their respective Affiliates under any note, bond or other debt instrument, or any  guarantee of the indebtedness of any Person;  (iii) Any defects in products sold by the Seller prior to the Closing or any liability  or obligation of the Seller or any of its Affiliates in respect of any express or implied representation, warranty,  agreement or guaranty made (or claimed to have been made) by the Seller or any of its Affiliates or imposed or  asserted to be imposed by operation of law as regards any products sold by the Business or the Seller prior to  the Closing;  (iv) Any obligation of the Seller or the Affiliated Trucking Companies (including  indemnification and other contingent obligations) relating to acts, events or omissions by any Person or  circumstances existing at or prior to the Closing Date;  (v) Any violation by the Seller, the Affiliated Trucking Companies or any of the  Seller’s Affiliates of, or default by the Seller, the Affiliated Trucking Companies or any such Affiliates under,  any law, rule, regulation, code, determination or order of any foreign, federal, state or local governmental body,  court or agency (“Laws”) related to or arising from operation of the Business or ownership of the Purchased  Assets prior to the Closing Date, or any remedial obligation under any Law arising out of or related to the  ownership or operation of the Purchased Assets or the Business prior to the Closing;  (vi) any debts, liabilities or obligations to any employee, agent, officer, director,  consultant, contractor or any Shareholder, which arose prior to the Closing Date, as to any salary, bonus,  commission, vacation, severance or other termination pay or benefits or other compensation or benefits arising  out of or in connection with any Employee Benefit Plan of the Seller or the Affiliated Trucking Companies,  including but not limited to, liabilities or obligations for medical, dental, vision, travel, accident, accidental  death or dismemberment and life insurance expenses and employee post-retirement life insurance or health care  benefits (irrespective of the time at which claims are presented), all of which shall remain the obligations of the  Seller or the Affiliated Trucking Companies or their insurance carriers;  (vii) any liability resulting from or relating to the employment relationship between  the Seller, an Affiliated Trucking Company or the Seller’s or Affiliated Trucking Company’s Affiliates and any  of their respective present or former employees or the termination of any such employment relationship, which  arose prior to the Closing Date, including, but not limited to, any claim for wrongful discharge, breach of  contract, unfair labor practice, employment discrimination, unemployment compensation or workers’  compensation;  (viii) any liability, which arose prior to the Closing Date, associated with or arising  out of any pension, profit sharing, deferred compensation or other Employee Benefit Plan of the Seller or the  Affiliated Trucking Companies; and although, following the Transition Period, Purchaser shall provide  continuation coverage required under Section 4980B of the Internal Revenue Code of 1986, as amended, and/or  

 

6 17618573v10  Part 6 of Title I of the Employee Retirement Income Security Act of 1974, as amended, to each “M&A qualified  beneficiary” (as defined in Treasury Regulation § 54.4980B-9 or any successor regulation);    (ix) Any liabilities associated with outstanding payables or purchase orders of the  Seller, and uncashed checks and checks in transit in respect to the same.    2.3 Closing.  The closing of the transactions contemplated herein (the “Closing”) shall take place  effective as of 12:01 a.m. local time in City of Industry, California, no later than two (2) Business Days after  the conditions to closing set forth in Article IX below have been satisfied or validly waived by the party(ies)  entitled to do so, or such other date as the parties shall agree in writing (the “Closing Date”), by means of  exchange of signature pages by facsimile or other electronic means (to be followed by delivery of hard copies  of all Closing deliveries) or, at the election of the Seller and the Purchaser, at the offices of the Seller’s or the  Purchaser’s counsel. 2.4 Property, Sales and Use Taxes. All real, personal and intangible ad valorem property or  similar Taxes imposed on a periodic basis (collectively, “Property Taxes”) and all sales, use, transaction or  excise Taxes (collectively “Sales and Use Taxes”) levied with respect to the Purchased Assets for any Straddle  Period (collectively, the “Apportioned Obligations”) shall be apportioned between the Pre-Closing Tax Period  and the Post-Closing Tax Period as follows: (i) in the case of Property Taxes, the portion allocable to the Pre- Closing Tax Period shall be deemed to be the amount of such Property Tax for the entire Straddle Period  multiplied by a fraction the numerator of which is the number of days in the portion of the Straddle Period  ending on the Closing Date and the denominator of which is the number of days in the entire Straddle Period,  and (ii) in the case of Sales and Use Taxes and Taxes not covered in Section 2.4(i), the portion allocable to the  Pre-Closing Tax Period shall be deemed equal to the amount which would be payable if the relevant Straddle  Period ended on the Closing Date.  The Seller shall be liable for the Apportioned Obligations allocated to the  Pre-Closing Tax Period, and the Purchaser shall be liable for the Apportioned Obligations allocated to the Post- Closing Tax Period.  ARTICLE 3  OTHER COVENANTS AND AGREEMENTS  3.1 Employee Matters.  (a) Transition Services. The Seller shall provide assistance and services to the Purchaser  and access to and use of the Seller’s personnel in order to effectuate the orderly transition of the Business from  the systems and plans of the Seller to the systems and plans of the Purchaser during such period as agreed upon  by Purchaser and Seller (the “Transition Period”), all as more specifically provided for in a transition services  agreement, which shall be executed by the Seller and the Purchaser at the Closing, attached hereto as Exhibit  3.1(a) (the “Transition Services Agreement”).  (b) Offer of Employment to Key Employees.  At the Closing, the Seller and the Majority  Shareholders shall cause each of those individuals listed on Schedule 3.1(b) (the “Key Employees”) to enter  into an employment agreement with the Purchaser, substantially in the form attached hereto as Exhibit 3.1(b)  (the “Employment Agreements”).   (c) Offer of Employment to Other Employees. The Purchaser shall offer employment to  and hire each of the Seller’s or the Affiliated Trucking Companies’ employees who is listed on Schedule 3.1(c),   and who is eligible to be employed by the Purchaser (“Current Employees”) as of or after the Closing Date with  employment to be effective during or immediately following the expiration of the Transition Period.    

 

7 17618573v10  (d) Conditions of Employment.  With respect to employee benefits, nothing contained in  this Agreement shall prohibit the Purchaser from changing or eliminating after the Closing the benefits that  were being made available to Current Employees prior to the Closing. To the extent permitted under the terms  of the Purchaser’s employee benefit plans or arrangements, any Current Employees hired by the Purchaser shall  be given credit, under the Employee Benefit Plans of the Purchaser, toward eligibility and vesting, but not  benefit accrual, for the period of time prior to the Closing (plus any employment with the Seller or an Affiliated  Trucking Company during the Transition Period) during which such individuals were Current Employees if  such period of time would otherwise qualify for eligibility and vesting under the Purchaser’s Employee Benefit  Plans providing similar benefits.  The provisions of this Section 3.1 shall not create any third party beneficiary  rights, and the Purchaser will have sole discretion for all employment decisions, wages, salaries, benefits and  other terms and condition of employment of any and all of its employees; provided, that the Current Employees  hired by the Purchaser shall be offered a salary or hourly wage that is materially comparable to that which they  received prior to the Closing Date, subject to compliance with all applicable laws.  (e) Notice to Employees.  The Seller shall be responsible for timely providing all notices  and other communications to employees and making any payments that may be required under the Worker  Adjustment and Retraining Notification Act, as amended from time to time, and any similar state statute,  relating to notice to employees, if such provisions apply to the transaction contemplated hereunder; provided  that the Seller and Purchaser do not intend that any such notice or payments should be required as Purchaser  intends to hire all eligible Current Employees.  3.2 Expenses.    (a) Expenses of the Purchaser.  Subject to Section 3.3(d), all of the expenses incurred by  the Purchaser or its Affiliates in connection with the authorization, negotiation, preparation, execution and  performance of this Agreement and other agreements referred to herein, including, without limitation, all fees  and expenses of agents, representatives, brokers, counsel and accountants for the Purchaser, shall be paid by  the Purchaser or its Affiliates.  (b) Expenses of the Seller and the Shareholders. Subject to Section 3.3(d), all expenses  incurred by the Seller, the Affiliated Trucking Companies or the Shareholders in connection with the  authorization, negotiation, preparation, execution and performance of this Agreement and the other agreements  referred to herein, including without limitation, all fees and expenses of agents, representatives, brokers, counsel  and accountants for the Seller or the Shareholders, shall be paid by the Seller or the Shareholders, provided that  the Purchaser shall pay the fees and expenses of Fort Dearborn Partners in connection with the preparation of  the Historical Financials (defined below).  3.3 Tax Matters.  (a) Definitions.  As used in this Agreement, the following terms have the following  specified meanings:  (i) “Code” means the Internal Revenue Code of 1986 and the revenue rulings  and regulations promulgated thereunder, as the same may be amended from time to time.  Any references to a  specific section of the Code shall refer to the cited provisions as the same may be subsequently amended from  time to time, as well as to any successor provision(s).  (ii) “Person” means any individual, corporation, partnership, limited liability  company, joint venture, trust, business association, organization, governmental entity or other entity.  

 

8 17618573v10  (iii) “Post-Closing Tax Period” means any Tax period beginning after the  Closing Date and that portion of any Straddle Period beginning after the Closing Date.  (iv) “Potential Successor Tax” means any Taxes owed by the Seller as of the  Closing Date with respect to which the Purchaser or its Affiliates may have successor liability.  (v) “Pre-Closing Tax Period” means any Tax period ending on or before the  Closing Date and the portion of any Straddle Period ending on the Closing Date.  (vi) “Straddle Period” means any Tax period beginning before and ending after  the Closing Date.  (vii) “Tax Authority” means any United States federal, foreign, national, state,  county or municipal or other local government, any subdivision, agency, commission or authority thereof, or  any quasi-governmental body exercising any taxing authority or any other authority exercising tax regulatory  authority.  (viii) “Tax Return” means any return, report, statement, form or other  documentation (including any additional or supporting material and any amendments or supplements (including  claims for refund)) filed or maintained, or required to be filed or maintained, with respect to or in connection  with the calculation, determination, assessment, collection or administration of any Taxes.  (ix) “Taxes” (or “Tax” as the context may require) means (A) any and all taxes,  fees, levies, duties, tariffs, imposts and other charges of any kind, imposed by any Tax Authority, including,  without limitation, taxes or other charges on, measured by, or with respect to income, franchise, windfall, or  other profits, gross receipts, property, sales, use, capital stock, payroll, employment, social security, workers’  compensation, unemployment compensation or net worth taxes; taxes or other charges in the nature of excise,  withholding, escheat, unclaimed property, ad valorem, premium, stamp, transfer, value-added or gains taxes;  environmental, production or severance taxes; license, registration and documentation fees; and custom’s  duties, tariffs and similar charges; (B) any liability for the payment of any amounts of the type described in (A)  as a result of being a member of an affiliated, combined, consolidated or unitary group for any taxable period;  (C) any liability for the payment of any amounts of the type described in (A) as a result of being a Person  required by Law to withhold or collect taxes imposed on another Person; (D) any liability for the payment of  amounts of the type described in (A), (B) or (C) as a result of being a transferee of, or a successor in interest to,  any Person, as a result of an express or implied obligation to indemnify any Person (including by reason of a  tax sharing, tax reimbursement or tax indemnification agreement); and (E) any and all interest, penalties (civil  or criminal), additions to tax and additional amounts imposed in connection with or with respect to any amounts  described in (A), (B), (C) or (D) and any expenses incurred in connection with the determination, settlement,  or litigation of any tax liability.  (b) Filing of Tax Returns.  The Seller and the Majority Shareholders shall be solely  responsible for and shall timely pay, without any cost to the Purchaser, any and all Taxes assessed against and  payable by the Seller or any Shareholder arising from the operations of the Business or use of the Purchased  Assets prior to the Closing (regardless of whether the filing of any Tax Returns with respect thereto or payment  of any amount in respect thereof are filed, paid or due prior to, on or after the Closing Date).    (c) Cooperation.  Except as otherwise provided in this Agreement, the parties hereby agree  that each of them shall cooperate with the other(s) in executing or causing to be executed any required document  and by making available to the other, as promptly as practicable, all work papers, records and notes of any kind  at all reasonable times for the purpose of allowing the appropriate party to complete Tax Returns, participate in  proceedings, make any determination required under this Agreement or defend or prosecute Tax claims.  

 

9 17618573v10  (d) Transfer Taxes.  Notwithstanding anything in Section 2.4 to the contrary and except as  provided in Section 3.10 and for any taxes or fees related to the retitling of any Vehicles which shall be borne  solely by Purchaser,  the Seller and the Majority Shareholders shall be solely responsible for payment of all  sales, use, transfer, documentary, stamp, recording and similar non-income taxes and fees, levied, imposed or  assessed by any Tax Authority as a result of the sale, transfer, assignment and conveyance of the Purchased  Assets to the Purchaser.    (e) Employment Tax.  The Purchaser and the Seller agree that they will follow the standard  procedure of Rev. Proc. 2004-53, 2004-53 I.R.B. 320, whereby each shall be solely responsible for employment  tax reporting for employees who may be employed by any of them in the calendar year that includes the Closing  Date or Transition Period, as applicable. The Seller shall provide the Purchaser with such employment tax  information as the Purchaser shall reasonably request in connection with the Purchaser’s employment tax  reporting obligations for the portion of the calendar year following the Closing, and the Purchaser shall provide  the Seller with such employment tax information as the Seller shall reasonably request in connection with the  Seller’s employment tax reporting obligations for the portion of the calendar year prior to the Closing.  (f) Tax Refunds.  Any refund of Taxes that are Assumed Liabilities and relate to any  taxable period, or a portion thereof, beginning after the Closing Date shall belong to the Purchaser.  If the Seller  or any Shareholder receives payment of any amounts payable to the Purchaser in respect of any refund of Taxes attributable to such Assumed Liabilities, the Seller or such Shareholder (as directed to by the Majority  Shareholders), as applicable, shall remit such payments to the Purchaser within ten (10) days of receipt thereof.  Any refund of Taxes that are Excluded Liabilities and relate to any taxable period, or portion thereof, beginning  before the Closing Date shall belong to the Seller. If the Purchaser receives payment of any amounts payable  to the Seller in respect of any refund of Taxes attributable such Excluded Liabilities, the Purchaser shall remit  such payments to the Seller within ten (10) days of receipt thereof.  (g) Potential Successor Taxes.  Unless otherwise directed in writing by the Purchaser, the  Seller shall give all required notices and make all required filings, including on behalf of the Purchaser when  required, of the transactions contemplated hereby, including any notices and filings required to obtain tax good  standing letters or tax clearances or certificates with the Tax Authorities of any state or any local Tax Authority  with which the Seller is required to file Tax Returns or pay Taxes.  If the Seller fails to provide to the Purchaser  at the Closing all appropriate tax good standing letters and tax clearances and certificates, then the Purchaser  may withhold from the Purchase Price the amount of the Potential Successor Taxes, and the Purchaser shall  thereafter cause such Taxes to be paid, to the extent of such withholding, on the Seller’s behalf; provided that,  the Purchaser’s option to not withhold shall not limit the Seller or Shareholders indemnification obligations  with respect to a breach of this Section 3.3(g) and Section 7.1(m) provided further that duplicative recoveries  under this Section and Article 6 shall not be permitted.  (h) Purchase Price Allocation.  The parties agree that the Purchase Price (including any  Assumed Liabilities that are treated as consideration for the Purchased Assets for federal income tax purposes),  as adjusted hereunder, and all other amounts constituting consideration within the meaning of Section 1060 of  the Code, shall be allocated among the Purchased Assets in accordance with the methodology set forth on  Schedule 3.3(h), which schedule has been prepared in a manner consistent with Section 1060 of the Code and  the regulations promulgated thereunder (the “Consideration Allocation”).  The Seller and the Purchaser agree  to (i) be bound by the Consideration Allocation, (ii) act in accordance with the Consideration Allocation in the  preparation and the filing of all Tax Returns (including, without limitation, filing Form 8594 with their United  States federal income Tax Return for the taxable year that includes the Closing Date) and in the course of any  Tax audit, Tax review or Tax litigation relating thereto and (iii) take no position and cause their Affiliates to  take no position inconsistent with the Consideration Allocation for income Tax purposes, including United  States federal and state income Tax and foreign income Tax, unless otherwise required pursuant to a  “determination” within the meaning of Section 1313(a) of the Code. Within ninety (90) days after the Closing  

 

10 17618573v10  Date, the Purchaser shall prepare and deliver a draft of its IRS Form 8594, completed in a manner consistent  with the Consideration Allocation, to the Majority Shareholders. The Majority Shareholders shall have fifteen  (15) days thereafter to review and raise any objections with respect to such form.  If the Majority Shareholders  raise any such objections, the Parties shall, for the thirty (30) days thereafter, exercise good faith efforts to  resolve those objections.  3.4 Change of Name. As of the Closing, the Seller shall assign to the Purchaser all of its rights to  the names Sealand Food and Chang Cheng Seafoods, and the Seller agrees that the Purchaser may, but is not  required to, conduct business under such name from and after the Closing.  Except if waived in writing by  Purchaser, no later than ninety (90) Business Days after Closing, the Seller and its Affiliates shall change their  respective names (corporate and trade names, as applicable) to names that do not contain any of the words  contained in the above-referenced names, and none of the Seller, any Shareholder (except in connection with  their employment by the Purchaser) or any of their respective Affiliates shall thereafter use (a) a name, service  mark, trademark or logo that contains any such words or (b) the names Sealand Food or Chang Cheng Seafoods,  or any names, words or phrases that are confusingly similar thereto. 3.5 Bulk Sales.  The parties hereby waive compliance with the provisions of any bulk sales, bulk  transfer or similar Laws of any jurisdiction that may otherwise be applicable with respect to the sale of any or  all of the Purchased Assets to Purchaser. For the avoidance of doubt, this Section 3.5 does not waive Seller’s  obligations under Section 3.3(g). 3.6 Confidentiality and Public Announcements.  The provisions of any other agreement to the  contrary notwithstanding, including any provisions of that certain Confidentiality Agreement, by and between  B&R Global Holdings, Inc., a subsidiary of Parent, and Seller, effective December 1, 2021 (the “Confidentiality  Agreement”), until the disclosure contemplated by the following sentence is made, the parties agree to maintain  the confidentiality of (a) the transactions contemplated by this Agreement, any of the Transaction Documents  or any of the Purchaser  Transaction Documents and (b) the respective terms of such agreement and documents,  unless disclosure is required by Law. The parties agree to announce the consummation of such transactions  simultaneously at a mutually agreeable time. The content of all announcements and publicity relating to this  Agreement, any of the Transaction Documents or any of the Purchaser Transaction Documents will be subject  to the mutual approval of the Seller and the Purchaser (except as otherwise required by Law).  Each party hereto  (hereinafter referred to in this context as a “receiving party”) shall, and shall cause its representatives to,  maintain the confidentiality of all non-public information concerning the other parties hereto (each such party  hereinafter referred to in this context as a “disclosing party”) (other than such information that becomes  generally available to the public other than as a result of disclosure by the receiving party) that becomes known  by such receiving party or its representatives as a result of the negotiation or consummation of the transactions  contemplated by this Agreement, any of the Transaction Documents or any of the Purchaser Transaction  Documents.  Nothing contained herein shall limit the right of any such persons to disclose any such information  to their subsidiaries, employees, agents, representatives, counsel, accountants and financial advisors for the  purpose of facilitating the consummation of the transactions contemplated hereby.   3.7 Assignment of Certain Contracts and Rights.  The Seller will (and the Majority Shareholders  shall cause the Seller and the Affiliated Trucking Companies to) apply for or otherwise seek, and use  commercially reasonable efforts to obtain, all consents and approvals required for consummation of the  transactions contemplated hereby, by any of the Transaction Documents or by any of the Purchaser Transaction  Documents, including without limitation, those consents listed in Schedule 4.4.  Any fees or expenses imposed  by any third party for such consents and approvals shall be borne solely by the Seller.  To the extent that any  required consents and approvals are not obtained by the Seller with respect to any of the Assigned Contracts or  any License, this Agreement, to the extent permitted by Law, shall constitute an equitable assignment by the  Seller or the Affiliated Trucking Companies, as applicable, to the Purchaser of all of the Seller’s rights, benefits,  title and interest in and to such Assigned Contracts or Licenses, as applicable, and the Purchaser shall be deemed  

 

11 17618573v10  to be the Seller’s or the Affiliated Trucking Companies’, as applicable, agent for the purpose of completing,  fulfilling and discharging all of the Seller’s rights and liabilities arising after the Closing Date under such  Assigned Contracts or Licenses, as applicable, and the Seller shall take all necessary steps and actions to provide  the Purchaser with the benefits of such Assigned Contracts or Licenses, as applicable. Notwithstanding the  foregoing, the assignment of all Vehicle leases that are Assigned Contracts shall be accomplished in the manner  set forth in the Transition Services Agreement. The Seller shall hold the Purchaser harmless from any loss,  damage or liability that results from Seller’s failure to obtain any required consents and approvals hereunder.    3.8 Noncompetition/Non-solicitation Agreements.  Concurrently with the Closing, the  Purchaser, Seller and each Shareholder listed on Schedule 3.8 shall enter into a three (3) year  Noncompetition/Non-solicitation Agreement in substantially the forms attached hereto as Exhibits 3.8(a) and  3.8(b) (the “Noncompetition Agreements”), respectively, and thereafter comply with all of the terms thereof.  3.9 Preservation of Minute Books and Records.  The Seller agrees to (and the Majority  Shareholders shall cause the Seller to) preserve, for a period of seven (7) years from the Closing Date, all of the  minute books and stock records relating to the Seller and the Shareholders and to make them available, upon  reasonable notice, during normal business hours, to the Purchaser, its counsel, accountants and others authorized  by it for inspection and the making of photocopied extracts therefrom at the Purchaser’s expense.  3.10 Purchase of Inventory.    (a) On a mutually determined date prior to the Closing Date (the “Inspection Date”), the Seller and  the Purchaser shall conduct a physical count of Seller’s Saleable inventory of products for sale in the operation  of the Business in the ordinary course (the “Inventory”) located at each Leased Real Property (the amount of  such Inventory, the “Pre-Closing Inventory”). The Seller, Majority Shareholders and the Purchaser shall use  commercially reasonable efforts to agree in writing on the aggregate Value of the Pre-Closing Inventory as of  the Inspection Date (the “Pre-Closing Inventory Value”). For purposes of this Section 3.10, “Value” shall mean  the cost of the Pre-Closing Inventory paid by the Seller to the suppliers thereof, including, without limitation,  freight and import fees incurred by Seller.  (b) On the Closing Date, the Purchaser shall purchase and take title to all of Seller’s Inventory  located at the Leased Real Property and shall pay the purchase price therefor in an amount equal to the lesser  of (i) Six Million Dollars ($6,000,000) and (ii) fifty percent (50%) of the Value of Seller’s Inventory as of the  Closing Date at the cost paid therefor (the “Closing Date Inventory Payment”). The remaining payment due to  Seller for Seller’s Inventory (the “Remaining Inventory Payment”; together with the Closing Date Inventory  Payment, the “Inventory Payments”) shall be payable by Purchaser on net 25 day terms and be an amount equal  to the Pre-Closing Inventory Value minus the Closing Date Inventory Payment. The Remaining Inventory  Payment due to the Seller pursuant to this Section 3.10 shall be paid to the Seller in the same manner that the  Purchaser shall pay the Closing Cash Payment, as prescribed under Section 2.1(a).  (c) The parties shall agree to reasonable policies with respect to the separation and/or removal of  Inventory not purchased by the Purchaser hereunder. For the avoidance of doubt, the Inventory Payments shall  be in addition to the Purchase Price. For purposes of this Agreement, Inventory shall be “Saleable” only if it  (including its packaging) is in the physical condition to be sold to customers in the ordinary course of the  Business and in accordance with applicable government regulations, provided, however, that “Saleable”  Inventory does not include: (i) any item whose supplier notifies the Seller prior to the applicable Inventory  Payment that such item may not be distributed following the date of such Inventory Payment; (ii) any items that  are private label products for customers who prior to the date of the Inventory Payment informed the Seller that  they are no longer customers of the Seller or that such products are no longer to be sold to such customer after  the Closing Date, but only to the extent that such products are not otherwise Saleable; (iii) any items that are,  pursuant to industry or government standards, including, without limitation, USDA standards, out-of-date or  

 

12 17618573v10  that, do not comply with the Contracts pursuant to which such items are to be sold; (iv) any item that has a  defective or damaged label, package or case; (v) any special order item that is not designated for a specific sale,  to the extent not otherwise Saleable; or (vi) any item that is a frozen product older than eighteen (18) months;  provided, however, than any frozen product older than twelve (12) months (such products, “Aged Inventory”)  shall only be “Salable” if (A) Seller can provide documentation reasonably satisfactory to Purchaser that such  Aged Inventory can be sold no later than six (6) months after Closing and (B) the value of the Aged Inventory  is less than six percent (6%) of the value of the Inventory. The Inventory shall be in the amounts substantially  consistent with the Seller’s ordinary business practices and at levels substantially consistent with the operation  of the Business during the twelve months prior to the Closing.  (d) Within sixty (60) days after the Closing Date, Purchaser shall conduct an item-level physical  count and inspection of all of the Pre-Closing Inventory purchased thereby to determine the actual Value of  Saleable Inventory included in the Pre-Closing Inventory (the “Actual Inventory”). If the Value of the Actual  Inventory is more or less than the amount paid by Purchaser to the Seller therefor (such difference, the “Excess”  or the “Shortfall”, as the case may be), the Purchaser shall be permitted, at its sole discretion, to either (i) offset  against the amount of the subsequent Inventory Payment the amount of the Shortfall (if additional Inventory  Payments are then remaining) or (ii) reclaim an amount of the Escrow Amount equal to the Shortfall in  accordance with the terms of the Escrow Agreement.  In the event of an Excess, Purchaser shall, within five (5)  Business Days of such determination pay to the Seller the amount of such Excess in the same manner as the  payments under (b) above.   3.11.  Accounts Receivable.  After the Closing the Purchaser shall use commercially reasonable  efforts in the ordinary course of business to collect any outstanding trade accounts receivable of the Seller  arising from the Business prior to the Closing Date on the Seller’s behalf and for its account, provided that in  no event shall the Purchaser be required to use greater efforts to collect any such accounts receivable than the  Seller used with respect thereto prior to the Closing.  3.12 Reasonable Access. Subject to the terms of the Confidentiality Agreement, from and after the  date hereof, upon reasonable prior notice, the Seller and its employees, agents and representatives shall (and  the Majority Shareholders shall cause the same to) provide to the Purchaser, its employees, agents, counsel,  accountants and financial consultants reasonable access during normal business hours to the offices, properties,  personnel, customers, suppliers, professional advisors, records, files and other documents and information of  or relating to the Purchased Assets or the Business as the Purchaser may reasonably request; provided that such  access shall not unduly interfere with the Seller’s operations.  Subject to the foregoing, the Seller shall (and the  Majority Shareholders shall cause the same to) allow the Purchaser, its employees, agents, counsel, accountants  and financial consultants access to a work area within the Seller’s offices and shall allow the copying, at the  Purchaser’s expense, of any such records as requested by the Purchaser.        3.13 Conduct of Business by the Seller and Majority Shareholders Pending the Closing.    (a) Ordinary Course.  The Seller and each Majority Shareholder covenant and agree that,  unless the Purchaser shall otherwise consent in writing and except as otherwise set forth herein, between the  date hereof and the Closing, the Business shall be conducted only in, and the Seller shall not (and the Majority  Shareholders shall cause the Seller and the Affiliated Trucking Companies not to) take any action except in, the  ordinary course of the Business and in a manner consistent with past practice, and the Seller will use its  commercially reasonable efforts to preserve intact the business organization of the Seller, the Affiliated  Trucking Companies and the Business, to keep available the services of the present officers, employees and  consultants of the Seller and the Affiliated Trucking Companies and to preserve the present relationships of  the  Seller and the Affiliated Trucking Companies with customers, suppliers and other Persons with whom the Seller  or an Affiliated Trucking Company has business relations.  

 

13 17618573v10  (b) Certain Actions.  By way of amplification and not limitation, except as expressly  provided for in this Agreement (including, for the avoidance of doubt, Section 3.10 above), the Seller shall not  (and the Majority Shareholders shall cause the Seller and the Affiliated Trucking Companies not to), between  the date hereof and the Closing, directly or indirectly, do any of the following without the prior written consent  of the Purchaser:   (i) (A) merge or consolidate with or into another entity; (B) except in the ordinary  course of the Business and in a manner consistent with past practice, sell, pledge, dispose of, or  encumber or authorize or propose the sale, pledge, disposition or encumbrance of any assets leased,  used or held for use by the Business; (C) enter into any contract or agreement with an aggregate value  in excess of Fifty Thousand and 00/100 Dollars ($50,000.00), except in the ordinary course of the  Business and in a manner consistent with past practice; (D) authorize or make any capital expenditures  in the aggregate in excess of Fifty Thousand and 00/100 Dollars ($50,000.00); or (E) enter into or  amend any contract, agreement, commitment or arrangement with respect to any of the matters set forth  in this Section 3.13(b)(i);  (ii) take any action other than in the ordinary course of the Business and in a  manner consistent with past practice (none of which actions shall be unreasonable) with respect to  increasing compensation (including bonuses) of any employee or with respect to the grant of any  severance or termination pay or with respect to any increase of benefits payable under its severance or  termination pay policies in effect in the last twelve (12) months;  (iii) make any payments except in the ordinary course of the Business and in  amounts and in a manner consistent with past practice (none of which payments shall be unreasonable  under the circumstances), under any Employee Benefit Plan or otherwise to any employee of the Seller  or an Affiliated Trucking Company or any other individual, enter into any Employee Benefit Plan, any  employment or consulting agreement, grant or establish any new awards under any such existing  Employee Benefit Plan or agreement, or adopt or otherwise amend any of the foregoing;  (iv) take any action except in the ordinary course of the Business and in a manner  consistent with past practice with respect to, or make any change in, its methods of management,  purchasing, distribution, marketing, accounting or operating (or practices relating to payment of trade  accounts or to other payments or collection of accounts receivable);   (v) do any act or omit to do any act that would reasonably be expected to cause a  breach of any contract, commitment or obligation of the Business, the Seller or an Affiliated Trucking  Company;  (vi) dissolve and/or liquidate the Seller;   (vii) make or guarantee any loan or enter into any transaction with or distribute any  assets or property (other than Excluded Assets) to any of its officers, directors, employees, Shareholders  or Affiliates (except for base salary paid to employees in the ordinary course of the Business); or  (viii) pay or discharge any Excluded Liabilities using any assets of the Seller or an  Affiliated Trucking Company, other than cash, including the Purchased Assets.  3.14 No Negotiations.  The Seller and each Majority Shareholder covenant and agree that, subject  to the termination provisions contained herein, from and after the date hereof, none of the Seller, any Majority  Shareholder, any of their respective employees, officers or directors or anyone acting on behalf of either the  Seller, an Affiliated Trucking Company or any of such Persons shall, directly or indirectly, solicit, engage in  

 

14 17618573v10  discussions or negotiations with, or provide any information to, any Person or group (other than the Purchaser  or its representatives) concerning any merger, sale of substantial assets, purchase or sale of shares of capital  stock or recapitalization or similar transaction involving the Seller, an Affiliated Trucking Company or the  Business (“Acquisition Proposal”).  The Seller and each Majority Shareholder hereby represent and warrant  that they are not engaged in any Acquisition Proposal activities and are not parties to or bound by any agreement  or understanding with respect to an Acquisition Proposal other than the sale to the Purchaser contemplated  hereby.   3.15   Supplement to Disclosure Schedules. From time to time prior to the Closing, the Seller shall  have the right (but not the obligation) to supplement or amend the Disclosure Schedules hereto with respect to  any matter hereafter arising (each a "Schedule Supplement"). Any disclosure in any such Schedule Supplement  shall not be deemed to have cured any inaccuracy in or breach of any representation or warranty contained in  this Agreement, including for purposes of the indemnification or termination rights contained in this Agreement  or of determining whether or not the conditions set forth in Section 9.1 have been satisfied; provided, however,  that if Purchaser has the right to, but does not elect to, terminate this Agreement within three (3) Business Days  of its receipt of such Schedule Supplement, then Purchaser shall be deemed to have irrevocably waived any  right to terminate this Agreement with respect to such matter and, further, shall have irrevocably waived its  right to indemnification under Section 6.1 with respect to such matter.  3.16 Removal of Fuel Tank.  As soon as practicable after the Closing, the Majority Shareholders  shall cause Poiner Realty to, at Poiner Realty’s sole cost and expense, (i) remove from the Headquarters the  6000 gallon diesel fuel tank (the “Fuel Tank”) and (ii) remediate (A) all environmental hazards identified by  the third party service provider that removes such tank or (B) all material environmental hazards as reasonably  requested by the Purchaser.   ARTICLE 4  REPRESENTATIONS AND WARRANTIES  OF THE SELLER AND THE MAJORITY SHAREHOLDERS  In order to induce the Purchaser to enter into this Agreement and consummate the transactions  contemplated hereby, and subject to the provisions of Article 6, the Seller and each Majority Shareholder,  jointly and severally, hereby represents and warrants as follows: 4.1 Incorporation and Authority of the Seller.  The Seller is a corporation duly organized,  validly existing and in good standing under the laws of the state of Maryland. The Seller is duly qualified as a  foreign corporation in all jurisdictions in which the conduct of its businesses or the ownership of its properties  requires such qualification.  Schedule 4.1 lists all the states where the Seller is so qualified. The Seller has all  necessary corporate power and authority to own, lease and operate its respective properties and to conduct the  Business as it is currently being conducted. Except as set forth on Schedule 4.1, the Seller does not own, directly  or indirectly, any interest in any Person.  4.2 Power and Authority; Due Authorization. The Seller has full corporate power and authority,  and each Shareholder has full power, capacity and authority, to execute and deliver this Agreement and each of  the Transaction Documents to which the Seller or such Shareholder is or will be a party and to consummate the  transactions contemplated hereby and thereby.  For purposes hereof, “Transaction Documents” means each of  the agreements, documents and instruments referenced in this Agreement to be executed and delivered by the  Seller or any Shareholder at or in connection with the Closing, including, without limitation, the  Noncompetition Agreements, the Employment Agreements, the Escrow Agreement, the New Lease and the  Transition Services Agreement.  The board of directors and the Shareholders of the Seller have duly approved  and authorized the execution and delivery of this Agreement and each of the Transaction Documents to which  Seller or such Shareholder is or will be a party, as appropriate, and the consummation of the transactions  

 

15 17618573v10  contemplated hereby and thereby, and no other proceedings with respect thereto are necessary.  Assuming that  this Agreement and each of the Transaction Documents constitutes a valid and binding agreement of the  Purchaser, this Agreement and each of the Transaction Documents constitutes, or will constitute when executed  and delivered, a valid and binding agreement of the Seller or the Shareholders, as the case may be, in each case  enforceable in accordance with their respective terms, subject to (i) the effect of bankruptcy, insolvency,  fraudulent transfer, reorganization, moratorium, rearrangement, liquidation, conservatorship and other Laws of  general application at the time in effect relating to or affecting the rights of creditors generally, including,  without limitation, court decisions, general equity principles and the statutory provisions of the Federal  Bankruptcy Code, as amended, pertaining to preferential or fraudulent transfers or conveyances; and (ii) general  principles of equity (regardless of whether such principles are considered in a proceeding at law or in equity).  4.3 Title to Purchased Assets.  Except for Permitted Encumbrances, the Seller and each Affiliated  Trucking Company has good and valid title to, a valid leasehold interest in or a written license to all of the  Purchased Assets free and clear of any and all Encumbrances, and any such leased or licensed Purchased Assets  and the owner or lessee of such Purchased Assets are identified on Schedule 4.3.  At the Closing, the Seller and  Affiliated Trucking Companies will transfer to the Purchaser good and valid marketable title to all of the  Purchased Assets free and clear of any and all Encumbrances other than Permitted Encumbrances.  Other than  the Leased Real Property, all assets and rights relating to the Business are held solely by the Seller or the  Affiliated Trucking Companies, and all agreements, obligations, expenses and transactions related to the  Business have been entered into, incurred and conducted only by the Seller or the Affiliated Trucking  Companies, and no Shareholder or Affiliate of the Seller own or has any rights in or to any of the Purchased  Assets or other properties or rights used by the Seller or the Affiliated Trucking Companies in the Business.   4.4 No Conflict; Required Consents.  Except for the consents, approvals, authorizations and other  actions listed on Schedule 4.4, the execution and delivery by the Seller and the Majority Shareholders of this  Agreement and/or the Transaction Documents and the consummation by the Seller and the Shareholders of the  transactions contemplated hereby and thereby do not and will not: (a) require the consent, approval or action  of, or any filing or notice to, any Person, including any public, governmental or judicial authority; (b) violate  the terms of any material instrument, document or agreement to which the Seller or any Shareholder is a party,  or by which the Seller or any Shareholder or the property of the Seller (including the Purchased Assets) or any  Shareholder is bound, or be in conflict with, result in or constitute (upon the giving of notice or lapse of time  or both) a breach or default under any such instrument, document or agreement, or result in the creation of any  lien upon any of the property or assets of the Seller (including the Purchased Assets) or any Shareholder; (c)  violate any order, writ, injunction, decree, judgment, ruling, law, rule or regulation of any federal, state, county,  municipal, or foreign court or governmental authority applicable to the Seller, any Shareholder, the Purchased  Assets or the Business; (d) violate the articles of incorporation (or equivalent formation document) or bylaws  (or equivalent governing documents) of the Seller or any of the Shareholders or any other company agreement  of or relating to the Seller or the capital stock thereof; or (e) result in the creation of any Encumbrance upon  any of the Purchased Assets.  The Seller is not subject to or a party to, nor are the Purchased Assets subject to,  any Encumbrance, mortgage, lien, lease, agreement, contract, instrument, order, judgment or decree or other  restriction of any kind or character that would prevent or hinder the continued operation of the Business by the  Purchaser after the Closing on substantially the same basis as theretofore operated. 4.5 Ownership.  The Shareholders are the sole record and beneficial owners of all of the issued  and outstanding capital stock of the Seller in such amounts as set forth on Schedule 4.5. No Person other than  the Shareholders has any direct or indirect beneficial or record interest in the capital stock of the Seller. The  duly elected officers and directors of the Seller are set forth on Schedule 4.5.   4.6 Compliance with Laws.  The Business and the Seller are and have been at all times since  January 1, 2019, in material compliance with all applicable Laws, including those promulgated or issued by the  Department of Labor, the Office of Federal Contract Compliance Program, U.S. Customs and Border  

 

16 17618573v10  Protection, the Occupational Safety & Health Administration, the Food and Drug Administration, the United  States Department of Agriculture, the Securities Exchange Commission and the Department of Homeland  Security (“DHS”).  Neither the Seller nor the Majority Shareholders has received notice of any noncompliance  with the foregoing or is aware of any basis therefor. Without limiting the preceding two sentences: (i) no  director, Majority Shareholder, officer, employee, or, to the Seller’s knowledge, agent of Seller is an official,  agent, or employee of any government or governmental agency or political party or a candidate for any political  office; (ii) none of such Persons has, directly or indirectly, in the name of, on behalf of, or for the benefit of the  Seller, offered, promised, authorized to pay or paid any compensation or given anything of value to, any official,  agent or employee of any government or governmental agency, or to any political party or officer, employee or  agent thereof which would violate or contravene any applicable Law; and (iii) the Seller has at all times  complied with the Foreign Corrupt Practices Act in all respects.  Seller is not employing anyone who is restricted  from employment without approval by the United States Department of Agriculture (“USDA”), and Seller has  never posted a bond with the USDA to employ anyone. Except as set forth on Schedule 4.6, there is no civil,  criminal or administrative judgment, action, suit, demand, claim, hearing, notice of violation, notice of  investigation, proceeding, notice or demand letter pending, or, to the knowledge of the Seller, threatened, and,  to the knowledge of the Seller, there is no investigation pending, against the Seller by the USDA.  4.7 Licenses and Permits.  The Seller holds and is in compliance with all licenses, permits,  concessions, grants, franchises, approvals and authorizations (“Licenses”) listed on Schedule 1.1(e), and such  list constitutes all of the material Licenses necessary or appropriate for the use or ownership of any of the  Purchased Assets, any part of the Leased Real Property or the operation of the Business.  Neither the Seller nor  the Majority Shareholders has received within the thirty-six (36) months preceding the date hereof notice of  any actual or potential violations (or warnings thereof) in respect of any such Licenses.  No proceeding is  pending or, to the knowledge of the Seller, threatened, which seeks revocation or limitation of any such  Licenses. 4.8 Financial Information; No Undisclosed Liabilities.  (a) Books and Records; Historical Financials.  The books of account and related records  of the Seller are true, correct and complete and fairly reflect in reasonable detail its assets, liabilities and actual,  bona fide transactions related to the Business as conducted by the Seller.  Prior to the date hereof, the Seller has  made available to the Purchaser true, correct and complete copies of the statements of assets, liabilities and  equity and the related statements of revenues, expenses and retained earnings of the Seller for the years ending  December 31, 2019, December 31, 2020, and December 31, 2021, including in each case the notes thereto (the  “Historical Financials”). The Historical Financial Statements were derived from and are consistent with Seller’s  books and records.  (b) No Undisclosed Liabilities.  There are no liabilities or obligations of the Seller or the  Business of any nature, whether liquidated, unliquidated, accrued, absolute, contingent or otherwise, except for  those that incurred in the ordinary course of the Business, since January 1, 2019, consistent with past practice,  none of which individually or in the aggregate would have a Material Adverse Effect.  For purposes hereof,  “Material Adverse Effect” means any effect that is or would reasonably be expected to be materially adverse to  the operations, properties (including intangible properties), financial condition, assets, liabilities or regulatory  status of the Seller, the Purchased Assets, the Leased Real Property or the Business, taken as a whole, excluding  any effect that arises (A) from changes in economic or market conditions generally, (B) solely from the  announcement or performance of the transactions contemplated by this Agreement, or (C) from changes in any  Law, rules or regulations of general applicability or interpretation thereof by any governmental authority;  provided, however, that “Material Adverse Effect” shall not include any event, occurrence, fact, condition or  change, arising out of or attributable to: (i) conditions generally affecting the industries in which the Seller’s  Business operates, including without limitation wage inflation across the trucking industry; (ii) monetary  inflation, or any changes in financial, banking or securities markets in general; (iii) acts of war (whether or not  

 

17 17618573v10  declared), armed hostilities, terrorism, or the escalation or worsening thereof; (iv) any changes in applicable  Laws or accounting rules (including rules accordance with generally accepted accounting principles in the  United States (“GAAP”) or the enforcement, implementation or interpretation thereof; (v) the announcement,  pendency or completion of the transactions contemplated by this Agreement; (vi) any natural or man-made  disaster or acts of God; or (vii) any epidemics, pandemics, disease outbreaks, or other public health  emergencies, including without limitation, the COVID-19 virus and its current or future permutations, whether  known or unknown; or (viii) any failure by the Business to meet any internal or published projections, forecasts  or revenue or earnings predictions (provided that the underlying causes of such failures (subject to the other  provisions of this definition) shall not be excluded); provided, that any change, effect, event, occurrence, state  of facts or development set forth in the immediately preceding clauses (i) – (vii) of this definition shall be taken  into account in determining whether there has been or would reasonably be expected to be a Material Adverse  Effect on the business, financial condition or results of operations of the Business to the extent such change,  effect, event, occurrence, state of facts or development has a disproportionate impact on the Business relative  to other Persons in the industry in which the Business operates.  (c) No Insolvency.  Seller is not, and has never been during the twelve (12) months  immediately preceding the execution of this Agreement, insolvent within the meaning of 11 U.S.C. §101(32).   Seller has paid and is continuing to pay its debts as they become due.  4.9 Tax Returns and Payments. (a) Tax Returns and Payments.  (i) All Tax Returns required to be filed by or on behalf of  the Seller since January 1, 2019, have been duly and timely filed with the appropriate Taxing Authorities in  all jurisdictions in which such Tax Returns are required to be filed (after giving effect to any valid extensions  of time in which to make such filings) and all such Tax Returns were true, complete and correct in all material  respects; (ii) all Taxes payable by or on behalf of the Seller (whether or not shown on a Tax Return) have  been fully and timely paid, and adequate reserves or accruals for any unpaid Taxes have been provided for  on the Historical Financials with respect to any tax period for which Tax Returns have not yet been filed or  for which Taxes are not yet due and owing; (iii) no agreement, waiver or other document or arrangement  extending or having the effect of extending the period for assessment or collection of Taxes (including, but  not limited to, any applicable statute of limitation), has been executed or filed with the Internal Revenue  Service (“IRS”) or any other Taxing Authority by or on behalf of the Seller and no power of attorney with  respect to any Tax matter is currently in force; and (iv) no written claim has ever been made by any Tax  Authority in a jurisdiction where the Seller does not file Tax Returns that the Seller is or may be subject to  Tax in that jurisdiction.  All applicable sales Taxes, to the extent due, were paid by the Person required to  collect such Taxes when the Purchased Assets were acquired by the Seller.  (b) Withholding Taxes.  The Seller has complied with all applicable Laws relating to the  payment and withholding of Taxes in connection with any amounts paid or owing to any employee, independent  contractor, creditor, stockholder, or other third party, including, without limitation, all information reporting,  backup withholding, and maintenance of required records with respect thereto.  Seller has not received any  notice of any obligation to pay any employment taxes owed or allegedly owed with respect to the Current  Employees.   (c) Examinations.  All deficiencies asserted or assessments made as a result of any  examinations by the IRS or any other Taxing Authority of the Tax Returns of or covering or including the Seller  have been fully paid, and, to the knowledge of the Seller, there are no other audits or investigations by any  Taxing Authority in progress, nor has the Seller received any notice from any Taxing Authority that it intends  to conduct such an audit or investigation.  No issue has been raised by a Taxing Authority in any prior  examination that, by application of the same or similar principles, could reasonably be expected to result in a  proposed deficiency for any subsequent taxable period.  

 

18 17618573v10  (d) Consolidated Returns; Tax Sharing Agreements.  The Seller has never been a  member of an affiliated group (within the meaning of Section 1504(a) of the Code) filing a consolidated U.S.  federal income Tax Return, nor does the Seller have any liability (whether known or unknown, asserted or  unasserted, liquidated or unliquidated, and whether due or to become due) for the Taxes of any Person under  Treasury Regulation §1.1502-6 (or any similar provision of state, local or foreign law), as transferee or  successor, by contract or otherwise.  The Seller is not a party to a Tax sharing or similar agreement or  arrangement (whether or not written) pursuant to which it has an obligation to indemnify another Person with  respect to Taxes.  (e) Tax Rulings.  Seller is not subject to any private letter ruling of the IRS or any ruling  or binding agreement with any Tax Authority that could impact Seller’s liability for Taxes or Seller’s Tax  attributes for any Tax period (or portion thereof) that ends after the Closing Date.  (f) S Corp Status. The Seller has been a validly existing S corporation within the  meaning of Sections 1361 and 1362 of the Code at all times during its existence.  (g) No Tax Liens. There are no Liens for Taxes (other than statutory Liens for Taxes  which are not yet due and payable), nor are there any Liens for Taxes which are pending or threatened, against  the assets of the Seller or the Purchased Assets.   4.10 Diverse Supplier/Minority Business Enterprise Requirements and Goals. The Seller’s  Contracts do not include and the relationships do not otherwise subject any Seller to (whether expressly or by  reference to any other Contract, policy, procedure, guideline, goal, objective, or Law) any diverse supplier,  minority business enterprise or similar provisions. Neither the Seller nor the Majority Shareholders has any  reason to believe that they were engaged to satisfy goals or guidelines of any Contract party for diversity or  business with minority enterprises. 4.11 Assigned Assets and Vehicles. Schedule 1.1(a) and Schedule 1.1(f) are true, correct and  complete lists of all of the trucks, tractors, trailers, vehicles, scissor lifts, fork lifts, scales, storage units,  appliances, furniture, tools, fixtures (including any dry area racking), machinery, ice machines, equipment,  communications equipment, hardware and software having a fair market value in excess of $5000, used or held  for use by the Seller or the Affiliated Trucking Company to the operation of the Business by the Seller or the  Affiliated Trucking Companies (collectively, the “Assigned Assets and Vehicles”), and each such schedule  identifies the Seller or Affiliated Trucking Company that owns or holds the rights to use such Assigned Assets  and Vehicles.  Each of the Assigned Assets and Vehicles listed on Schedule 1.1(a) and Schedule 1.1(f) is in  good operating condition and repair, normal wear and tear excepted, is fit for use in the ordinary course of  business as historically conducted by the Seller and, to the knowledge of the Seller, is free of material defects,  except as set forth on Schedule 4.11. The Seller and the Affiliated Trucking Companies have properly  maintained and repaired in all material respects the Assigned Assets and Vehicles listed on Schedule 1.1(a) and  Schedule 1.1(f) in the ordinary course of its Business.   4.12 Intellectual Property.   (a) Schedule 1.1(b) lists the following Owned Intellectual Property owned by the Seller:  (i) all United States and foreign issued patents (including design and utility patents), and pending applications  relating to the foregoing; (ii) all registered trademarks, registered service marks and trademark and service  mark applications; (iii) all registered copyrights and copyright applications and all renewals and extensions;  (iv) all domain name registrations ((i) through (iv), collectively, the “Registered Intellectual Property”). To  the extent applicable with respect to any of the Registered Intellectual Property, Schedule 1.1(b) also lists the  jurisdiction in which such Registered Intellectual Property been registered or filed and the applicable  registration or serial number of the owner thereof, as applicable. To the knowledge of the Seller, all Owned  Intellectual Property is valid and enforceable. No Registered Intellectual Property has been abandoned, and,  

 

19 17618573v10  where applicable, any renewal and maintenance fees or other fees payable in respect of the Registered  Intellectual Property and due before the Closing have been paid in full through the Closing. Seller does not  own any proprietary or custom-made software.  (b) The Seller owns or has a valid, exclusive right (evidenced in a writing made available  to Purchaser) to use all of the Intellectual Property used in or necessary to operate the Business. The Seller is  the sole owner of all Owned Intellectual Property identified on Schedule 1.1(b), free and clear of all  Encumbrances except for Permitted Encumbrances.  (c) No current or former officer, director, Majority Shareholder, employee, consultant,  agent or other representative of the Seller owns or, to the Seller’s knowledge, claims any personal rights in  (nor has any of them made application with respect to) any of the Intellectual Property used in the operation  of the Business. Except as required by filing, issuance and registration activities, the Seller has taken all  reasonable actions necessary to safeguard the confidentiality of trade secrets.  (d) There are no pending or, to the knowledge of the Seller, threatened actions, lawsuits,  administrative charges, proceedings or investigations by any Person against the Seller relating to the use by  the Seller or the Business of any Intellectual Property used in the Business or challenging the Seller’s  ownership of (solely with respect to the Owned Intellectual Property) or rights to use such Intellectual  Property. The Seller is not involved in any actions, lawsuits, administrative charges, proceedings or  investigations initiated by or on Seller’s behalf relating to any Intellectual Property used by Seller or the  Business in the operation of the Business. To the knowledge of the Seller, there has been no infringement or  misappropriation by third parties of any Intellectual Property used by the Seller or the Business in the  operation of the Business.  (e) To the knowledge of Seller, neither the Seller nor the Business has (i) infringed upon,  misappropriated or violated any Intellectual Property rights of any third party or (ii) received any written  charge, demand letter, complaint, claim or notice (including an offer to license) alleging any such  infringement, misappropriation or violation.  (f) Upon the consummation of the transactions contemplated by this Agreement, the  Transaction Documents and the Purchaser Transaction Documents and compliance with applicable Laws as  to the assignment of such Intellectual Property, the Purchaser will have obtained all rights of the Seller to  own (in the case of the Owned Intellectual Property), license or otherwise exclusively and validly use (in the  case of all other Intellectual Property used by the Seller or the Business) all Intellectual Property used by the  Seller or the Business in the operation of the Business.   4.13 Food Safety Matters. Since January 1, 2019, neither the Seller nor the Majority Shareholders  has received any written notice, or to the knowledge of the Seller any oral notice, from any Person of any claim  or potential claim against it relating to bodily injury, death or other disability caused by the products sold by  the Seller, and to the knowledge of the Seller, there are no facts or circumstances which would cause a Person  to reasonably believe any such claim or potential claim exists or is likely to occur. To the knowledge of the  Seller, no product distributed or sold by the Seller would have warranted legal action by any governmental  authority so that a product recall or post-sale warning should have occurred or did, in fact, occur. The Seller  and, to the knowledge of the Seller, its suppliers are, and at all times since January 1, 2019, have been, in  material compliance with all applicable Laws related to the purchase, preparation, labeling, storage, handling,  maintenance, distribution and sale of food products, including under the applicable provisions of the Federal  Food, Drug and Cosmetic Act, the Federal Meat Inspection Act of 1906, the Poultry Products Inspection Act  of 1957, the Organic Foods Production Act of 1990, the Public Health Security and Bioterrorism Preparedness  and Response Act of 2002, and the Country of Origin Labeling requirements. Neither the Seller nor the Majority  Shareholders has received any written notice, or to the knowledge of the Seller any oral notice, from any  

 

20 17618573v10  governmental authority or other Person of any violation of any such applicable Laws, and to the knowledge of  the Seller, there are no facts or circumstances which would cause a Person to reasonably believe any such  violation or potential violation exists or is likely to occur. The Seller has at all times since January 1, 2019,  maintained, good industry standards with respect to the handling, packaging, maintenance, storing, labeling and  distribution of food products and have complied in all material respects with the terms and conditions of all  Contracts with respect to such matters. 4.14 Contracts.  Schedule 4.14 sets forth a true and complete list of all Material Contracts. “Material  Contracts” means each Lease and each other Contract (a) that involves aggregate payments by or to the Seller  in excess of $25,000, (b) that contains a covenant by the Seller not to compete or any other covenant that  materially restricts the operation of the Business after the Closing, (c) that is with any governmental entity,  agency or instrumentality, or (d) is otherwise material to the ownership and/or operation of the Business.  “Contract” means any written contract, agreement, lease or other instrument to which the Seller is a party or to  which the Purchased Assets are subject or bound, including without limitation, agreements with distributors,  vendors, suppliers, customers, employees and independent contractors, but excluding purchase orders made or  received in the ordinary course of the Business to or from the Seller’s customers or suppliers.  Prior to execution  of this Agreement, the Seller has made available to the Purchaser true, correct and complete copies of the written  Material Contracts and written descriptions of the terms of any Material Contracts, including any and all  amendments thereto.  To the knowledge of the Seller, the Material Contracts are valid, legally binding and  enforceable against all parties thereto, including the Seller, subject to the effect of bankruptcy, insolvency,  reorganization, moratorium, rearrangement, liquidation, conservatorship and other Laws of general application  in effect affecting creditors’ rights and subject to the exercise of judicial discretion in accordance with general  equitable principles.  Neither the Seller nor, to the Seller’s knowledge, any other party to any of the Material  Contracts is in breach of, or in default under, any of the Material Contracts; and no event has occurred or failed  to occur which, (i) with the giving of notice or lapse of time, or both, would constitute a default by the Seller  or any other party to any of the Material Contracts thereunder or (ii) gives any other party to any of the Material  Contracts the right to terminate such Material Contract.  Except as set forth on Schedule 4.14, the assignment  of any of the Assigned Contracts to the Purchaser in accordance with this Agreement will not constitute a breach  or violation of any such Assigned Contract.  There are no negotiations pending nor, to the knowledge of the  Seller, threatened or requested with respect to, nor any outstanding rights to renegotiate, any Assigned Contracts  or to materially reduce the volume or character of business currently conducted thereunder.  4.15 Litigation; Judgments.  Schedule 4.15 sets forth a complete and accurate list and brief  description of any and all actions, administrative charges, proceedings or investigations involving the Seller,  the Purchased Assets, or the Business before any court, tribunal, alternative dispute resolution forum or  governmental body that are currently pending or were outstanding at any time during the three (3) years prior  to the date hereof. Except as set forth on Schedule 4.15, there is no action, administrative charge, proceeding  or investigation pending with respect to or, to the knowledge of the Seller, threatened against or involving the  Seller, the Purchased Assets or the operation of the Business, nor is there any action or proceeding pending or,  to the knowledge of the Seller, threatened before any court, tribunal or governmental body seeking to restrain  or prohibit or to obtain damages or other relief in connection with the consummation of the transactions  contemplated by this Agreement, or which is reasonably likely to adversely affect the Business or the Purchased  Assets or the Seller’s or a Majority Shareholder’s ability to consummate the transactions contemplated by this  Agreement, the Transaction Documents or the Purchaser Transaction Documents. The Seller is not subject to  any judgment, order or decree entered in any lawsuit or other type of proceeding relating to the Purchased  Assets or the operation of the Business.  4.16 Insurance.  Schedule 4.16 lists all of the insurance policies maintained by the Seller, which  schedule includes the name of the insurance company, the policy number, a description of the type of insurance  provided by such policy, the expiration date of the policy, the dollar limit of the policy, and the annual premiums  for such policy. Seller will maintain its insurance policies in full force and effect through the end of the  

 

21 17618573v10  Transition Period. The Seller is not in default or breach with respect to any provision contained in any insurance  policies maintained thereby, and the Seller has not failed to give any notice or to present any claim thereunder  in due and timely fashion. There are no claims related to the Business, the Purchased Assets or the Assumed  Liabilities pending under any such insurance policies as to which coverage has been questioned, denied or  disputed or in respect of which there is an outstanding reservation of rights. None of the Majority Shareholders,  the Seller or any of their respective Affiliates has received any written notice of cancellation of, premium  increase with respect to, or alteration of coverage under, any of such insurance policies. The insurance policies  are sufficient for compliance of the Business with all applicable Laws and contracts to which the Seller is a  party or by which it or its assets are bound in connection with the ownership, operation or management of  Business as currently conducted. 4.17 Employees; Union; Labor.  The Seller and each Affiliated Trucking Company is in  compliance in all material respects with all applicable Laws relating to the employment of labor.  Except as  could not reasonably be expected to result in a material liability to the Seller or an Affiliated Trucking Company,  the Seller or each Affiliated Trucking Company has classified all individuals who perform services for the  Seller or such Affiliated Trucking Company correctly, in accordance with the terms of each Employee Benefit  Plan and ERISA, the Code, the Fair Labor Standards Act and all other applicable Laws, as employees,  independent contractors or leased employees, and neither the Seller nor any Affiliated Trucking Company has  received notice to the contrary from any Person (including any governmental authority).  There are no actions,  lawsuits, administrative charges, proceedings or investigations pending or, to the Seller’s knowledge,  threatened against the Seller or any Affiliated Trucking Company before the U.S. Equal Employment  Opportunity Commission or any federal, foreign, state or local court or agency concerning alleged employment  discrimination or any other matters relating to the employment of labor. Neither the Seller nor any Affiliated  Trucking Company has experienced any work stoppages or slowdowns due to labor disagreements and, to the  Seller’s knowledge, none are threatened.  To the Seller’s knowledge, no union organizing activities are pending  or threatened against the Seller or any Affiliated Trucking Company, and no such activities have occurred in  the past.  Neither the Seller nor any Affiliated Trucking Company is a party to any collective bargaining  agreement or any other contract, written or oral, with any trade or labor union or other labor organization or  any other collective bargaining relationship. Neither the Seller nor any Affiliated Trucking Company has ever  implemented any employee layoffs without complying with the Worker Adjustment Retraining and Notification  Act of 1988, as amended, or any similar Laws.  Schedule 4.17 lists, effective as of the date of this Agreement,  each individual employee, consultant, independent contractor, officer and director of the Seller and each  Affiliated Trucking Company, any written agreement with such person and such Person’s name; location; title;  date of hire; active or inactive status (including type of leave, if any); employment status (i.e., full-time, part- time, temporary); exempt or non-exempt status under the Fair Labor Standards Act; current annual base salary  or hourly wage compensation; and target bonus/commission compensation and total compensation for the prior  year and current year to date. All employees of the Seller and each Affiliated Trucking Company are employees- at-will. The current employees and contractors of the Seller constitute all personnel necessary for the operation  of the Business consistent with past practices of the Seller and the Affiliated Trucking Companies.    4.18 Benefit Plans and ERISA.    (a) Employee Benefit Plans.  Schedule 4.18(a) sets forth a complete list of each “employee  benefit plan” (as defined by Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended  (“ERISA”), and any other material bonus, compensation, deferred compensation, stock option, stock purchase,  fringe benefit, post-retirement, scholarship, sick leave, vacation, individual employment, payroll practice, or  retention plan, agreement, policy or arrangement (each, an “Employee Benefit Plan”) that is currently in effect  or that has been approved for the benefit of current or former employees or directors of, or any other persons  performing services for, the Seller, each Affiliated Trucking Company or their respective beneficiaries  (“Business Employees”) or with respect to which the Seller, any Affiliated Trucking Company or any “ERISA  Affiliate” (defined to include, with respect to the Seller or any Affiliated Trucking Company, any trade or  

 

22 17618573v10  business, whether or not incorporated, other than the Seller or an Affiliated Trucking Company, which has  employees who are or have been  treated pursuant to Section 4001(a)(14) of ERISA or Section 414 of the Code  as employees of a single employer which includes the Seller or any Affiliated Trucking Company) has or has  had any obligation on behalf of any Business Employee.  Except as otherwise set forth on Schedule 4.18(a),  neither the Seller, any Affiliated Trucking Company, nor any of their respective ERISA Affiliates has  maintained or contributed to any plan subject to Title IV of ERISA or the minimum funding standards of Section  412 of the Code or Section 302 of ERISA.  (b) Except as otherwise set forth on Schedule 4.18(b), (i) each of the Employee Benefit  Plans that is intended to be qualified under Section 401(a) of the Code, is so qualified, has received current  favorable determination letter, or is the adoption of a prototype or volume submitter plan, as the case may be,  subject to an opinion or advisory letter from the IRS, and nothing has occurred that could reasonably be expected  to affect the qualified status or qualification of any such Employee Benefit Plan and (ii) the Employee Benefit  Plans comply in form and in operation in all material respects with their terms and with the requirements  applicable Law, including the Code and ERISA.    (c) Post-Closing Liabilities.  Neither the Purchaser nor Parent, as a result of the  transactions contemplated by this Agreement (or any employment by the Purchaser of Business Employees)  shall:  (i) become liable for any contribution, Tax, lien, penalty, cost, interest, claim,  loss, action, suit, damage, cost assessment or other type of liability or expense of the Seller or of any  ERISA Affiliate (including predecessors thereof) with regard to any Employee Benefit Plan, or any  Employee Benefit Plan sponsored, maintained or contributed to by an ERISA Affiliate (including  predecessors thereof) (assuming a definition of “Employee Benefit Plan” such as that provided in  Section 4.18(a) hereof were applicable to ERISA Affiliates) (each such Employee Benefit Plan for an  ERISA Affiliate being an “ERISA Affiliate Employee Benefit Plan”) including, without limitation,  withdrawal liability arising under Title IV, Subtitle E, Part 1 of ERISA, liabilities to the Pension Benefit  Guaranty Corporation, or liabilities under Section 412 of the Code or Section 302(a)(2) of ERISA; or  (ii) be or become a party to any Employee Benefit Plan or any ERISA Affiliate  Employee Benefit Plan.  (d) COBRA; FMLA. The Seller, each Affiliated Trucking Company, each ERISA  Affiliate, each Employee Benefit Plan and each Employee Benefit Plan “sponsor” or “administrator” (within  the meaning of Section 3(16) of ERISA) has complied in all material respects with the applicable requirements  of Part 6 of Subtitle B of Title I of ERISA and Section 4980B of the Code and all applicable state Laws regarding  the continuation of group health plan coverage (such federal and state statutory provisions are referred to herein  collectively as “COBRA”).  Schedule 4.18(d) lists the name of each Business Employee who has experienced  a “Qualifying Event” (as defined in COBRA) with respect to an Employee Benefit Plan and whose maximum  period for continuation coverage required by COBRA has not expired.  Included in such list are the current  address for each such individual, the date and type of each Qualifying Event, whether the individual has already  elected COBRA continuation coverage and, for any individual who has not yet elected continuation coverage,  the date on which such individual was notified of his or her rights to elect continuation coverage.  Schedule  4.18(d) also lists the name of each Business Employee who is on a leave of absence (whether or not pursuant  to the Family and Medical Leave Act of 1993, as amended (“FMLA”)) and is receiving or entitled to receive  health coverage under an Employee Benefit Plan, whether pursuant to FMLA, COBRA or otherwise. Schedule  4.18(d) also lists the name of each Business Employee who is on a leave of absence and whose reemployment  is governed by the Uniformed Services Employment and Reemployment Rights Act of 1994.  

 

23 17618573v10  (e) Multiple Employer Arrangements.  Neither the Seller nor any Affiliated Trucking  Company has had any obligation to contribute to or provide benefits pursuant to, or any other liability of any  kind (fixed or contingent) with respect to, (i) a “multiple employer welfare arrangement” (within the meaning  of Section 3(40) of ERISA), (ii) a “plan maintained by more than one employer” (within the meaning of Section  413(c) of the Code), or (iii) a “multiemployer plan” (within the meaning of Section 3(37) of ERISA) or (iv) any  common law theory of joint, dual or multiemployer liability.    4.19 Immigration Matters.   (a) IRCA Compliance.  The Seller and each Affiliated Trucking Company has made good  faith efforts to comply with all provisions of the Immigration Reform and Control Act of 1986, as amended,  and all regulations promulgated thereunder (“IRCA”).  (b) IRCA Compliance as to Current Employees.  Without limiting the generality of Section  4.19(a) above, the Seller and each Affiliated Trucking Company has made good faith efforts to comply with  those provisions of IRCA requiring that it reverify the employment eligibility of all current employees who  listed expiration dates for their employment eligibility on Form I-9 or who presented certain employment  eligibility documents to the Seller or such Affiliated Trucking Company with expiration dates.    (c) IRCA Compliance as to Former Employees.  Without limiting the generality of Section  4.19(a) above, the Seller and each Affiliated Trucking Company has made good faith efforts to comply with  those provisions of IRCA requiring that it maintain copies of Forms I-9 completed by former employees,  including copies of the verification documents presented by those former employees (if the Seller or such  Affiliated Trucking Company made such copies), for three (3) years after the date of each such employee’s hire  or for one (1) year after the date each such employee’s employment ended, whichever date is later.    (d) Nonimmigrant Visa Status.  Schedule 4.19(d) contains a substantially complete list of  all employees of the Seller and each Affiliated Trucking Company working who are permanent residents and  US citizens as well as those under DHS authorization in nonimmigrant visa status, including specific reference  to each such employee’s nonimmigrant classification, the exact date (month/day/year) each such employee’s  current nonimmigrant status expires, and any steps taken by the Seller or such Affiliated Trucking Company to  extend, amend, or change each such employee’s current nonimmigrant status.  Schedule 4.19(d) also contains  a true and complete list of all other individuals for whom the Seller and each Affiliated Trucking Company is  currently seeking to obtain nonimmigrant visa status, including specific reference to each such individual’s  intended nonimmigrant classification and any steps taken by the Seller or such Affiliated Trucking Company  to obtain such status on behalf of those individuals.  Schedule 4.19(d) also includes the list of US permanent  residents and Citizens with actions required to comply with I-9 form requirements.  The Seller and each  Affiliated Trucking Company has used best efforts to make all immigration records pertaining to those  employees and individuals available to the Purchaser.   (e) No Notices.  The Seller and each Affiliated Trucking Company has endeavored to only  employ individuals authorized to work in the United States.  Neither the Seller, nor any Affiliated Trucking  Company nor any Shareholder has received written notice of any inspection, investigation, proceeding, or  enforcement action relating to the Seller’s or any Affiliated Trucking Company’s alleged noncompliance with  or violation of IRCA, nor has the Seller or any Affiliated Trucking Company been warned, fined, or otherwise  penalized by reason of any failure to comply with IRCA or for any willful violation of any other immigration  Law.  (f) Social Security “No Match” Letters.  The Seller and each Affiliated Trucking  Company has performed reasonable due diligence in response to any and all “no-match letters” that it has  received from the U.S. Social Security Administration (“SSA”).  The Seller and each Affiliated Trucking  

 

24 17618573v10  Company has made available to the Purchaser any and all “no-match letters” which the Seller or such Affiliated  Trucking Company has received from the SSA and copies of any and all documentation evidencing that it  performed reasonable due diligence in response to its receipt of any and all such “no-match letters.”  (g) No Liability Arising from Closing.  The Closing will not give rise to any liability for  the failure of the Seller or any Affiliated Trucking Company to properly complete, update or maintain Forms I- 9 or for the employment of individuals not authorized to work in the United States.  4.20 Broker Fees and Expenses.  Neither the Seller nor any Shareholder has retained or utilized  the services of any broker, finder or intermediary, or paid or agreed to pay any fee or commission to any Person  for or on account of the transactions contemplated hereby.  Neither the Purchaser nor any of its Affiliates has  or will have any obligation to pay any such fees or commissions or other amounts to such Person. 4.21 Absence of Material Changes.  Since January 1, 2022: (a) there has not been any Material Adverse Effect;  (b) the Seller has not lost (or received written notice that it may lose) any customers,  distributors or suppliers with which the Seller has or had significant business relations exceeding $50,000  annually, and has not received written notice that any such customers, suppliers or distributors plan to materially  reduce the volume or character of business conducted with the Seller by an amount exceeding $50,000;  (c) the Seller and, to the Seller’s knowledge, each Affiliated Trucking Company has  operated the Business in the ordinary course and has not sold, assigned or transferred any assets, except in the  ordinary course of the Business consistent with past practice;  (d) the Seller or an Affiliated Trucking Company has not mortgaged or pledged, or  subjected to any lien, pledge, mortgage, security interest, conditional sales contract, or other Encumbrance of  any nature whatsoever (other than Permitted Encumbrances), the Purchased Assets, or affected any ownership  of the issued and outstanding equity securities of the Seller;  (e) there has been no amendment, termination, or waiver of any right of the Seller under  any contract, governmental license or permit that may have a Material Adverse Effect on the Purchased Assets,  the Business or any ownership of the Seller’s issued and outstanding equity securities;  (f) The Seller has not, directly or indirectly:  (i) paid any judgment resulting from any suit, proceeding, arbitration, claim or  counterclaim in respect of the Purchased Assets or the Business;  (ii) made any such payment to any party in settlement of any such suit, proceeding,  arbitration, claim or counterclaim;  (iii) made any material changes in the Seller’s customary methods of operation,  including practices and policies relating to accounting, purchasing, marketing, selling or payment of trade  creditors;  (iv) except in respect of ordinary trade payables, incurred any indebtedness or  guaranteed any indebtedness exceeding $100,000, except for borrowings under existing loans or lines of credit  in the ordinary course of the Business consistent with past practice;  

 

25 17618573v10  (v) issued or sold any of its stock, notes, bonds or other securities, or any option,  warrant or other rights to purchase the same;  (vi) taken any action other than in the ordinary course and in a manner consistent  with past practices (none of which actions has been unreasonable or unusual) with respect to increasing the  compensation of any employee of the Seller or with respect to the grant or increase of any severance or  termination pay to any such individual (otherwise than as disclosed to the Purchaser in writing prior to the date  hereof); or  (vii) agreed, whether in writing or otherwise, to take any of the actions specified in  this Section 4.21.  4.22 No Affiliation. Neither the Seller nor any Affiliated Trucking Company is now or has ever  been an Affiliate of or in any way associated with the entity “Sealand Food, Inc.”, a Virginia corporation located  at 11128 Henderson Road, Fairfax Station, Virginia 22039.  4.23 Certain Arrangements.  Except as set forth in Schedule 4.23 and except as expressly  contemplated by this Agreement or the Transaction Documents, no Related Party: (a) has or on the Closing  Date will have any contractual or other claim, express or implied, of any kind whatsoever against the Business  or any of the Purchased Assets; (b) has or on the Closing Date will have any interest in the Business or any of  the Purchased Assets; (c) is or on the Closing Date will be engaged in any other transaction with the Business  or with respect to any of the Purchased Assets; or (d) has or on the Closing Date will have any direct or indirect  ownership interest in any Person with which the Seller or the Business has a material business relationship.  As  used herein, “Related Party” means (i) any parent or subsidiary (direct or indirect) or division of the Seller, (ii)  any Shareholder, (iii) any employee, officer, manager or director of the Seller or any parent or subsidiary (direct  or indirect) of the Seller, (iv) any immediate family member of any of the members, shareholders, employees,  officers, managers or directors or Affiliates of any of the foregoing.  As used herein, “Affiliate” means, with  respect to any Person, any other Person that directly or indirectly Controls, is Controlled by, or is under common  Control with such first Person. A Person will be deemed to “Control” another Person if such first Person has  the power, directly or indirectly, to direct or cause the direction of the management and policies of such other  Person, whether through ownership of securities, by contract or otherwise. Except for the Leased Real Property,  no assets used in the operation of the Business are or will be owned, leased or licensed by Related Party.  4.24 Hazardous Substances.  For purposes of this Agreement: (i) “Environmental Laws” means  the Resource Conservation and Recovery Act, 42 U.S.C. Section 6901 et seq., the Comprehensive  Environmental Response, Compensation and Liability Act, 42 U.S.C. Section 9601 et seq., and all other  applicable federal, state, county, municipal, administrative or other laws, ordinances, rules, regulations and  requirements or common law doctrines pertaining to environmental, health, safety or ecological conditions,  along with any regulations, orders, binding written interpretations or policies promulgated or issued thereunder;  (ii) “Hazardous Material” means (A) any “hazardous substance”, “hazardous waste” or “hazardous material”  defined as such in (or for purposes of) any Environmental Law; (B) petroleum, including any fraction thereof,  and any petroleum product; (C) mold, radon, asbestos or any other potentially harmful indoor pollutant; and  (D) any other substance, regardless of physical form, that is subject to any law or common law doctrine  regulating, or imposing obligations, liability, or standards of conduct concerning the protection of human health,  plant life, animal life, natural resources, or property; provided that “Hazardous Material” shall not be deemed  to include substances, such as cleaning supplies, customarily used in the operation of the Business, kept in such  quantities as are customarily found in businesses similar to the Business provided the same are used, stored and  disposed of in all material respects in accordance with all laws regulating the same and that the Seller has not  incurred any potential or actual liability as a result of Release or disposal of such material; and (iii) “Release”  means any release, spill, emission, leaking, pumping, pouring, emptying, disposing, injection, deposit, disposal,  

 

26 17618573v10  discharge, leaching, or migration into any media, whether soil, surface water, ground water, air or any  combination of the foregoing, and the movement of any Hazardous Material through any media.  (a) Neither the Seller nor, to the knowledge of the Seller, any current or prior owner, user  or occupant of any part of the Leased Real Property, has conducted or authorized the use, generation,  transportation, storage, handling, treatment, or Release of any Hazardous Material on any part of the Leased  Real Property in a manner that would subject either the Seller or the Purchaser to any liability.  (b) During the Seller’s leasing and occupancy any part of the Leased Real Property, and,  to the knowledge of the Seller, with respect to any period prior thereto, there has been no Release of any  Hazardous Material on any part of the Leased Real Property in a manner that would subject either the Seller or  the Purchaser to any liability.  (c) Since January 1, 2019, neither the Seller nor the Majority Shareholders has received  any notice, and to the knowledge of the Seller, no governmental authority or any employee or agent thereof has  determined or threatens to determine, that there exists a violation of any Environmental Law at any part of the  Leased Real Property or that either the Seller or the Leased Real Property has incurred or is subject to any  liability under any Environmental Law, nor does the Seller have knowledge of any facts or circumstances that  would reasonably lead such Person to believe that any person or governmental authority may allege any of the  foregoing.  (d) Since January 1, 2019, neither the Seller nor the Majority Shareholders have received  notice of any (i) claim or (ii) pending litigation, investigation or proceeding before any court or any  governmental or administrative body in which it is alleged with respect to any part of the Leased Real Property  that there has been any on-site or off-site Release or the arranging for disposal of any Hazardous Material nor  does the Seller have knowledge of any facts or circumstances that would reasonably lead any such Person to  believe that any person or governmental authority may allege any of the foregoing.  (e) There are no agreements between the Seller or any Shareholder and any person, entity,  or governmental body or agency (federal, state or local) relating in any way to (i) the presence, Release, threat  of Release, storage, or treatment of any Hazardous Material with respect any part of the Leased Real Property  or (ii) payment or reimbursement to any person, entity or governmental authority for any such Release.  (f) There are no Environmental Laws applicable to any part of the Leased Real Property  that would require the Seller, any owner of the Leased Real Property or any other Person to obtain the approval  of or provide notice to any governmental authority (which has not been obtained or provided) as a condition to  the consummation of the transactions contemplated hereby.  (g) Since January 1, 2019, the Seller has operated each part of the Leased Real Property  in material compliance with all applicable Environmental Laws.  (h) The Seller, the Purchased Assets and any part of the Leased Real Property have all  Licenses required under the Environmental Laws, including, but not limited to, all Licenses relating to the  treatment or discharge of process water or waste water, registrations for underground storage tank systems, and  all equipment necessary to allow each part of the Leased Real Property, the Business and the Purchased Assets  to operate in compliance with all applicable Environmental Laws, and have complied with all such Licenses in  all material respects.  (i) Neither the Seller nor any part of the Leased Real Property has incurred any liability  or obligation under the Environmental Laws or otherwise pertaining to any Hazardous Material that remains  unresolved.  

 

27 17618573v10  (j) There are not currently nor, to the knowledge of the Seller, have there ever been on  any part of the Leased Real Property any underground storage tanks that would subject either the Seller or the  Purchaser to liability.  (k) Neither Majority Shareholder, nor Seller or, to the knowledge of the Seller, no part of  the Leased Real Property, has incurred any liability resulting from the Release or the arrangement for disposal  of any Hazardous Material either at any part of the Leased Real Property or at the property of any third party.   (l) The Seller and the Majority Shareholders have made available to the Purchaser or its  Affiliates copies of all documents, reports or tests with respect to the compliance of the Business, any part of  the Leased Real Property or any of the Purchased Assets with the Environmental Laws or the presence of any  Hazardous Material on any part of the Leased Real Property (“Environmental Reports”) that were (i) prepared  for the Seller or the Majority Shareholders or (ii) prepared for other parties and are in the possession of the  Seller or the Majority Shareholders.  There are no Environmental Reports.  (m) To the knowledge of the Seller, there is no construction debris or other debris buried  on any part of the Leased Real Property that is contaminated with Hazardous Material  4.25 Leased Real Property.  (a) Schedule 4.25(a) contains a true, complete and correct list of the real property  (including the address, landlord and tenant for such property) leased, subleased or licensed by the Seller or with  respect to which the Seller has the right to use, occupy or access pursuant to real property agreements, including  easements, rights of way or other similar real property agreements (the “Leased Real Property”), and the  agreements pursuant to which the Leased Real Property is leased, subleased or licensed (the “Leases”).  Except  as set forth on Schedule 4.25(a), (i) the Seller has not leased, subleased, licensed or otherwise granted to any  Person the right to use or occupy the Leased Real Property or any portion thereof, (ii) the Seller is not a party  to any agreement, right of first offer, right of first refusal or option with respect to the purchase or sale of any  real property or interest therein and (iii) each part of the Leased Real Property is used or held for use exclusively  in connection with the Business.  (b) The Leased Real Property is in good condition and repair, ordinary wear and tear  excepted, and have been properly repaired and maintained by the Seller or the owner of the Leased Real  Property in the ordinary course of business. The Seller has a valid, enforceable and exclusive right to use and  occupy each part of the Leased Real Property.  True, complete and correct copies of the Leases (including, for  the avoidance of doubt, amendments and modification thereto) have been provided to Purchaser prior to the  date hereof.  Neither the Seller nor the Majority Shareholders has received written notice of any special  assessment any or any condemnation, eminent domain or similar proceeding relating to the Leased Real  Property or any portion thereof and, to the Seller’s knowledge, there is no pending or threatened special  assessment, condemnation, eminent domain or similar proceeding with respect thereto.    4.26 Cost-Plus Contract Claims; Most Favored Nation.  The Seller is not a party to any contract  with its customers pursuant to which the pricing of products sold to the customer thereunder is determined  based upon the cost to the Seller of such goods sold thereunder (“Cost-Plus Contracts”).  There does not exist  under any contract with the customers of the Seller with any basis, regardless of the giving of notice or the lapse  of time or both, for a claim by the customer with respect to how the cost of products is calculated thereunder or  with respect to the pricing of products sold to such customers thereunder (“Cost-Plus Contract Claims”).   The  Seller is not a party to any agreement or arrangement with any customer of its Business that provides that such  customer shall be sold products or services at the lowest price the Seller charges its customers for any such  products or services or which contains any other “most favored nation” or similar clause and is not party to any  

 

28 17618573v10  agreement or arrangement with a supplier or vendor with an analogous provision “most favored nation” or  similar clause in favor of such vendor or supplier.   4.27 Sufficiency of Purchased Assets.  The Purchased Assets, together with the Excluded Assets,  constitute substantially all of the material assets of any nature with which the Seller has conducted the Business  for the twelve (12) month period prior to the Closing Date, subject only to immaterial additions and deletions  of inventory and equipment in the ordinary course of the Business.  All material assets and rights relating to the  Business are owned or leased solely by the Seller and the Affiliated Trucking Companies, and all material  agreements, obligations, expenses and transactions related to the Business have been entered into, incurred and  conducted only by the Seller and the Affiliated Trucking Companies. The Purchased Assets, together with the  Pre-Closing Inventory, are sufficient to enable the Purchaser to conduct the Business in the same manner  immediately after the Closing as the Business was conducted by the Seller as of immediately prior to the  Closing.  4.28 PCI.  The Seller has complied in all material respects with all applicable Laws regarding the  collection, retention, use and protection of an individual Person’s social security number or tax identification  number, driver’s license number, passport number, credit card number, bank information, or customer or  account number (“Personal Information”). The Seller has a privacy policy regarding the collection, use and  disclosure of Personal Information in connection with the operation of the Business and is in compliance with  such privacy policy.  No investigation is ongoing, and no Person has made or delivered to the Seller any claim  or, to the knowledge of the Seller, threatens any investigation, inquiry or action, relating to the Seller’s or the  Business’s information privacy or data security practices. The Seller has established and implemented  commercially reasonable policies, programs and procedures to protect the confidentiality, integrity and security  of Personal Information in the possession, custody or control of the Seller, its Affiliates or their respective  personnel or contractors against unauthorized access, use, modification, disclosure or other misuse.  To the  knowledge of the Seller, the Seller has not experienced any loss, damage, or unauthorized access, disclosure,  use or breach of security of any Personal Information in its possession, custody or control, or otherwise held or  processed on its behalf.  4.29 Product Warranties; Recalls. All products sold by the Seller and the Business prior to the  date hereof have conformed in all material respects to all applicable contractual commitments and all expressed  or implied warranties, except as to products returned and replaced in the ordinary course of business and not  materially exceeding the Seller’s historical warranty reserves therefor. To the knowledge of the Seller, no  liability for any warranty claims exists, including for the replacement of such products or other damages in  connection with such sales, except for such claims incurred in the ordinary course of business consistent in  amount and character with past experiences of the Seller. All product labeling of the Seller and the Business is  in conformity in all material respects with all applicable Laws.  There is not currently ongoing, and there has  not been at any time in the five (5) years prior to the date hereof, any product recalls initiated by the Seller or  required or requested by any federal, foreign, national, state, county or municipal or other local government,  any subdivision, agency, commission or authority thereof, or any quasi-governmental body with respect to any  products manufactured, sold or distributed by the Seller or the Business.  4.30 Products.  No claim for or investigation into product liability is pending against the Seller or  the Business. To the knowledge of the Seller, (a) no such claim or investigation is threatened, and (b) no event  has occurred which is reasonably expected to give rise to the assertion of any such claim or the initiation of  such an investigation.   4.31 Certain Transfers; Preferences.  To the knowledge of the Seller, neither the Seller, nor the  Majority Shareholders or any Affiliate thereof (a) has received any transfer which would constitute a fraudulent  transfer or fraudulent conveyance under applicable federal or state law or (b) has received a preference under  applicable federal law which it has an obligation to repay in whole or in part.  

 

29 17618573v10  4.32 Top Customers and Top Suppliers.  Schedule 4.32 lists the (a) ten largest customers of the  Seller (the “Top Customers”), and (b) ten largest suppliers to the Seller (the “Top Suppliers”), in each case for  the twelve (12)-month period ended December 31, 2020 and the twelve (12)-month period ended December 31,  2021, and two (2)-month period ended February 28, 2022 and sets forth opposite the name of each such Top  Customer and Top Supplier, the approximate percentage and dollar amount of net sales and/or amounts paid by  the Seller, in the aggregate, attributable to such Top Customer or Top Supplier for each such period.  Since  December 31, 2019, no Top Customer or Top Supplier has terminated its relationship with the Seller.  No Top  Customer or Top Supplier has given written notice to the effect that such Top Customer or Top Supplier will  (and to the knowledge of the Seller, no such Top Customer or Top Supplier has indicated that it intends to or  has threatened to) terminate its relationship with the Seller or materially decrease the rate of purchasing from  or to the Seller, whether as a result of the consummation of the transactions contemplated hereby or otherwise,  other than decreases in the ordinary course of business that are not material in the aggregate. The Seller is not  involved in any material claim, dispute or controversy with any such Top Customer or Top Supplier.  4.33 Pandemic Relief Program. All PPP Loan Liabilities of the Seller and each Affiliated Trucking  Company have been fully forgiven by the Small Business Administration (the “SBA”) and the applicable lender  of each PPP Loan. Schedule 4.33 lists any Pandemic-Relief Program in which the Seller or Affiliated Trucking  Company has participated (including any Indebtedness incurred under any Pandemic-Relief Program, e.g., any  Paycheck Protection Program loan) or through which the Seller or such Affiliate has received any monies or  assistance. True, complete and correct copies of all documents (including any applications) relating to the  Pandemic-Relief Programs required to be listed on Schedule 4.33 have been provided to Purchaser prior to the  date hereof. The Seller and each applicable Affiliated Trucking Company submitted accurate and complete  applications (if applicable), and was eligible, for all Pandemic-Relief Program required to be listed on Schedule  4.33 and has at all times complied in all respects with all agreements, rules and applicable Laws relating to such  Pandemic Relief Programs, including any restrictions on the use of the proceeds of any Indebtedness incurred  under any Pandemic-Relief Program. For purposes of this Agreement, (a) “Pandemic Relief Program” means  any Law (including the CARES Act), program or policy of any federal, state, local or foreign governmental or  quasi-governmental authority, entity or agency providing or expanding any loan, guaranty, investment,  participation, grant, program or other assistance in response to, or to provide relief from, the pandemic arising  from COVID-19 or SARS-Cov-2 or the economic consequences thereof, including, without limitation, the  Paycheck Protection Program, Economic Injury Disaster Loan program, the Main Street Lending Program or  any other similar state or local governmental authority program, (b) “CARES Act” means the CARES Act (Pub.  L. 116-136 (2020)), (c) “PPP Loan Liabilities” means all principal, interest or other amounts borrowed, incurred  or payable (through maturity) to any lender under or in connection with any PPP Loan, and (d) “PPP Loan”  means any Pandemic-Relief Program loan made pursuant to the Paycheck Protection Program of the SBA under  the CARES Act.  4.34 COVID-19 and COVID-19 Measures. Schedule 4.34 sets forth the material actions outside  of the ordinary course of business that the Seller has taken prior to the date hereof as a result of the COVID-19  pandemic.  4.35 Certain Compliance Matters. Neither the Seller, nor any of its directors, managers, officers  or employees, nor, to the knowledge of the Seller, any agent, Affiliate, joint venture partner or other Person  associated with or acting on behalf of the Seller, is an individual or entity, or controlled by an individual or  entity (within the meaning of the applicable Law), that is currently or has been (i) the subject or the target of  any sanctions (including, without limitation, any enabling legislation, executive orders, or regulations)  administered or enforced by the United States government (including, without limitation, sanctions  administered or enforced by the Office of Foreign Assets Control of the U.S. Department of the Treasury or  any other relevant governmental authority (collectively, “Sanctions”), including Persons that are the subject or  the target of the designations “specially designated national,” “blocked person,” “foreign sanctions evader,” or  any individual on the “Sectoral Sanctions Identification List,” or any similar list maintained by any  

 

30 17618573v10  Governmental Body; (ii) in receipt of notice of or aware of any actual or threatened action, administrative  charge, proceeding or investigation against it with respect to the Seller or other Persons that are the subject or  the target of Sanctions; or (iii) located, organized or resident in a country or territory that is the subject or the  target of Sanctions (each, a “Sanctioned Country”) to the extent, in the case of (i), (ii) or (iii), related to the  conduct of the Business. Neither the Seller nor the Majority Shareholders, nor any of their respective directors,  officers, Affiliates or, to the knowledge of the Seller, employees or agents, is now, or has been, engaged in  respect of the business in any dealings or transactions with any person that at the time of the dealing or  transaction is or was the subject or the target of Sanctions or with any Sanctioned Country. The Seller and , to  the knowledge of the Seller, its officers, managers, employees, directors and agents are, and have been, in  compliance with applicable Sanctions in respect of the Business. 4.36 No Liens or Encumbrances.  The Seller and the Majority Shareholders hereby covenant and  agree with the Purchaser that the Purchased Assets will be transferred and conveyed to the Purchaser at the  Closing free and clear of all Encumbrances, other than any Permitted Encumbrances. ARTICLE 5  REPRESENTATIONS AND WARRANTIES OF  PURCHASER   In order to induce the Seller and the Majority Shareholders to enter into this Agreement and  consummate the transactions contemplated hereby, the Purchaser hereby represents and warrants as follows:  5.1 Formation of the Purchaser.  Purchaser is a limited liability company duly formed and validly  existing under the laws of the Commonwealth of Virginia and has the power and authority to own its property  and to carry on its business as now being conducted by it.   5.2 Power and Authority; Due Authorization.  Purchaser has full power and authority to execute  and deliver this Agreement and each of the Transaction Documents to which Purchaser is or will be a party (the  “Purchaser Transaction Documents”) and to consummate the transactions contemplated hereby and thereby.   The manager of the Purchaser has duly approved and authorized the execution and delivery of this Agreement  and each of the Purchaser Transaction Documents and the consummation of the transactions contemplated  hereby and thereby, and no other proceedings on the part of the Purchaser are necessary to approve and authorize  the execution and delivery of this Agreement and the Purchaser Transaction Documents and the consummation  of the transactions contemplated hereby and thereby.  Assuming that this Agreement and each of the Purchaser  Transaction Documents constitutes a valid and binding agreement of the Seller and the Shareholders, as the  case may be, this Agreement and each of the Purchaser Transaction Documents constitute, or will constitute  when executed and delivered, valid and binding agreements of the Purchaser, in each case enforceable against  the Purchaser in accordance with their respective terms, subject to (a) the effect of bankruptcy, insolvency,  fraudulent transfer, reorganization, moratorium, rearrangement, liquidation, conservatorship and other Laws of  general application at the time in effect relating to or affecting the rights of creditors generally, including,  without limitation, court decisions, general equity principles and the statutory provisions of the Federal  Bankruptcy Code, as amended, pertaining to preferential or fraudulent transfers or conveyances; and (b) general  principles of equity (regardless of whether such principles are considered in a proceeding at law or in equity). 5.3 No Conflict; Consents.  The execution and delivery by the Purchaser of this Agreement, the  Purchaser Transaction Documents and the consummation by the Purchaser of the transactions contemplated  hereby and thereby do not and will not (a) require the consent, authorization, order, approval or action of, or  any filing or notice to, any Person, including any public, governmental or judicial authority; (b) violate the  terms of any material instrument, document or agreement to which the Purchaser is a party, or by which the  Purchaser or their property is bound, or be in conflict with, result in a breach of or constitute (upon the giving  of notice or lapse of time, or both) a default under any such instrument, document, or agreement; (c) violate the  Purchaser’s governing documents; or (d) violate any order, writ, injunction, decree, judgment, ruling, Law or  

 

31 17618573v10  regulation of any federal, state, county, municipal, or foreign court or governmental authority applicable to the  Purchaser, or the business or assets of the Purchaser, and relating to the purchase of the Purchased Assets.  5.4 Litigation; Judgments. There is no action, proceeding or investigation pending or, to the  Purchaser’s knowledge, threatened against or involving the Purchaser seeking to restrain or prohibit or to obtain  damages or other relief in connection with the consummation of the transactions contemplated by this  Agreement, or which might adversely affect the Purchaser’s ability to consummate the transactions  contemplated by this Agreement and the Purchaser Transaction Documents.  5.5 Brokers Fees and Expenses.  Neither the Purchaser nor any of its Affiliates have retained or  utilized the services of any broker, finder, or intermediary, or paid or agreed to pay any fee or commission to  any Person for or on account of the transactions contemplated hereby, or had any communications with any  Person that would obligate the Seller or any Shareholder to pay any such fees or commissions.  5.6 Solvency. Immediately after giving effect to the transactions contemplated hereby, neither  Purchaser nor Parent shall be insolvent within the meaning of 11 U.S.C. §101(32).  5.7 Independent Investigation. Purchaser has conducted its own independent investigation,  review and analysis of the Business and the Purchased Assets, and acknowledges that they have been provided  adequate access to the personnel, properties, assets, premises, books and records, and other documents and data  of Seller for such purpose. Purchaser acknowledges and agrees that: (a) in making its decision to enter into this  Agreement and to consummate the transactions contemplated hereby, Purchaser has relied solely its own  investigation and the express representations and warranties of the Seller and the Majority Shareholders as set  forth in this Agreement (including related portions of the Seller Disclosure Schedules) and the Transaction  Documents; and (b) neither the Seller, the Majority Shareholders, nor any other Person has made any  representation or warranty as to Seller, the Business, the Purchased Assets or this Agreement, except as  expressly set forth in this Agreement (including related portions of the Seller Disclosure Schedules) and the  Transaction Documents.  ARTICLE 6  INDEMNIFICATION  6.1 Indemnification by the Seller and the Majority Shareholders.  Subject to the terms of this  Article 6, and in addition to all other indemnification obligations contained elsewhere herein, the Seller and  each Majority Shareholder, jointly and severally, hereby indemnify the Purchaser, their respective Affiliates  and the employees, officers, directors, successors and assigns of any of the foregoing (collectively, the  “Purchaser Indemnitees”) and agree to defend, reimburse and hold them harmless from and against, and in  respect of all claims, liabilities, damages, payments, obligations, losses, costs and expenses (including  reasonable documented attorneys’ fees, court costs, expert witness fees, transcripts costs and other expenses of  litigation) and judgments (at law or in equity) (collectively, “Losses”) incurred or suffered by any of them and  arising out of or resulting from any of the following:   (a) (i)  any breach of, nonfulfillment of, or failure to perform any agreement or  covenant of the Seller, any Shareholder or any Affiliate of the Seller or such Shareholder contained herein or  in any other Transaction Document or (ii) any breach of or inaccuracy in any warranty, representation or,  certification  of the Seller, or any Shareholder contained herein or in any Transaction Document;  (b)  any action, claim, suit or proceeding now or hereafter pending or threatened by any  third party (including any governmental authority) arising out of actual or alleged acts or omissions of the Seller  or any Affiliate thereof, any Affiliated Trucking Company, any Majority Shareholder, or any of the officers,  

 

32 17618573v10  employees or agents of the Seller or an Affiliated Trucking Company in connection with the Seller’s or  Affiliated Trucking Company’s operation of the Business or ownership of the Purchased Assets on or prior to  the Closing Date;   (c) any Excluded Liabilities, regardless of whether such Excluded Liability was known by  or disclosed to the Purchaser or its Affiliates, or whether the existence or assertion of such Excluded Liability  constitutes a breach of any warranty, representation, or covenant of the Seller or any Shareholder contained in  this Agreement or in any Transaction Document;   (d)  (i) the failure of the Seller or any Affiliated Trucking Company to comply with IRCA  or any Law relating to immigration or eligibility to work in the United States of America or (ii) the employment  of any individual who is not eligible, pursuant to any Law, to work within the United State of America;  (e)        the failure of the Seller to cause the Affiliated Trucking Companies to transfer, assign  and convey all Vehicles, Assigned Contracts and other Purchased Assets owned thereby to the Purchaser during  the Transition Period, at no additional consideration to the Purchaser;  (f) any failure of the Seller with respect to the Seller’s election, or its failure to maintain  its status, as an S corporation within the meaning of Sections 1361 and 1362 of the Code;  (g) the failure of the Seller to properly remain and be in good standing in the required  states of jurisdiction, including but notwithstanding the State of Maryland;   (h) conditions related to the Fuel Tank, including, but not limited to, the presence or  removal of the Fuel Tank and the remediation of any environmental hazards related to the Fuel Tank pursuant  to Section 3.16; and  (i) any failure to: (i) establish, administer, or maintain any Employee Benefit Plan in  accordance with the terms of the Code, ERISA, or any other applicable law or (ii) administer or maintain any  Employee Benefit Plan in accordance with the terms and administrative procedures of such Employee Benefit  Plan.    6.2 Indemnification by the Purchaser.  Subject to the terms of this Article 6, the Purchaser hereby  agrees to indemnify the Seller, the Majority Shareholders and their respective employees, officers, directors,  successors and assigns (collectively, the “Seller Indemnitees”) and agrees to defend, reimburse and hold them  harmless from and against all Losses incurred or suffered by any of them and arising out of or resulting from  any of the following: (a) (i) any breach of, nonfulfillment of, or failure to perform any agreement or covenant  of the Purchaser contained herein or in any other Purchaser Transaction Document or (ii) any breach of or  inaccuracy in any warranty, representation or certification of the Purchaser contained herein or in any other  Purchaser Transaction Document;   (b) any action, claim, suit or proceeding hereafter pending or threatened by any third party  (including any governmental authority) arising out of actual or alleged acts or omissions of the Purchaser or  their respective officers, employees or agents in connection with the Purchaser’s business operations conducted  after the Closing Date, including the conduct of the business of the Purchased Assets (except to the extent  arising out of or related to any Excluded Liability or any other matter with respect to which the Purchaser is  entitled to indemnification under Section 6.1).   (c) any Assumed Liabilities.  

 

33 17618573v10  6.3 Provisions Regarding Indemnification. (a) General.  The party (or parties) believing it (or they) to be entitled to indemnification  hereunder (the “Indemnified Party”) shall promptly notify the other party (or parties) (the “Indemnifying Party”)  in writing of any claim, demand, action or proceeding for which indemnification will or may be sought under  Sections 6.1 or 6.2 (a “Notice of Claim”).  The Notice of Claim shall specify facts reasonably known to the  Indemnified Party giving rise to such indemnity rights.  Unless the Indemnifying Party notifies the Indemnified  Party, in writing, within fifteen (15) Business Days following its receipt of a Notice of Claim (a “Dispute  Notice”) that it disputes the right of the Indemnified Party to indemnification hereunder, the Indemnified Party  shall be conclusively deemed entitled to indemnification hereunder with respect to the matters described in such  Notice of Claim.  Any rights of indemnification established by reason of such agreement or failure to respond  shall promptly thereafter be paid and satisfied by the Indemnifying Party.  To the extent a dispute exists between  the Indemnified Party and the Indemnifying Party, such dispute shall be resolved in accordance with this  Agreement.  (b) Third Party Claims.  (i) Notice.  With respect to any matter for which an Indemnified Party is entitled  to indemnification from an Indemnifying Party under this Article 6 that relates to a claim by a third party (a  “Third Party Claim”), the Indemnified Party shall provide to the Indemnifying Party a Notice of Claim relating  to such Third Party Claim; provided, however, that no failure or delay in providing such a Notice of Claim shall  relieve the Indemnifying Party of any liability hereunder (except to the extent the Indemnifying Party has  suffered actual prejudice thereby).    (ii) Assumption of the Defense.  The Indemnifying Party shall have fifteen (15)  Business Days after receipt from the Indemnified Party of the Notice of Claim for a Third Party Claim to provide  written notice to the Indemnified Party of its election to assume, using legal counsel selected by it and  reasonably acceptable to the Indemnified Party, the defense of the Third Party Claim at its own expense;  provided, however, that if the Indemnifying Party’s assumption of the defense of any Third Party Claim would  result in a conflict of interest arising out of the joint representation by legal counsel selected by the Indemnifying  Party of the interests of both the Indemnifying Party and the Indemnified Party, the Indemnifying Party shall  be entitled to engage separate legal counsel (reasonably acceptable to the Indemnified Party) to represent the  Indemnified Party (at the Indemnifying Party’s sole cost and expense) and, if the Indemnifying Party fails to do  so during the fifteen (15) Business Day period referred to above, the Indemnifying Party shall not be entitled to  assume the Indemnified Party’s defense of such Third Party Claim.  If the Indemnifying Party assumes the  defense of a Third Party Claim, it shall thereafter promptly inform the Indemnified Party of all material  developments related thereto and copy the Indemnified Party on all pleadings, filings and other correspondence  relating thereto.  With respect to any Third Party Claim for which the Indemnifying Party has assumed the  defense in accordance with this Section 6.3(b)(ii): (A) the Indemnified Party shall have the right, but not the  obligation, to participate in the defense of such Third Party Claim through legal counsel selected by it, but the  costs and expenses of such legal counsel shall be borne solely by the Indemnified Party; and (B) the Indemnified  Party shall, during normal business hours and upon reasonable advance notice, at the cost and expense of the  Indemnifying Party, reasonably cooperate with, make its relevant files and records reasonably available for  inspection and copying by, make its employees reasonably available to, and otherwise render reasonable  assistance to, the Indemnifying Party in connection with the Third Party Claim.  (iii) Defense of Third Party Claim by the Indemnified Party.  If: (A) the  Indemnified Party does not receive notice from the Indemnifying Party in which the Indemnifying Party elects  to assume the defense of a Third Party Claim within the fifteen (15) Business Day time period set forth in  Section 6.3(b)(ii); (B) at any time after the Indemnifying Party has assumed the defense of a Third Party Claim,  the Indemnifying Party fails to perform or unreasonably delays in performing its obligations to assume or pursue  

 

34 17618573v10  the defense of any such Thirty Party Claim; or (C) within sixty (60) days after receipt of the delivery of the  related Notice of Claim the Indemnifying Party notifies the Indemnified Party that the Third Party Claim is not  an indemnifiable claim hereunder and tenders defense of such Third Party Claim to the Indemnified Party, the  Indemnified Party shall be entitled to fully assume, commence and pursue its own defense of such Third Party  Claim and the Indemnifying Party shall no longer be entitled to defend such Third Party Claim.    (iv) Settlement.  If the Indemnifying Party (having assumed the defense of a Third  Party Claim in accordance with Section 6.3(b)(ii)) or the Indemnified Party (having proceeded with its own  defense of a Third Party Claim in accordance with Section 6.3(b)(iii)) proposes to settle or compromise such  Third Party Claim, the Indemnifying Party or the Indemnified Party (as applicable) shall provide notice to that  effect (together with a statement describing in reasonable detail the terms and conditions of such settlement or  compromise and including a copy of the settlement agreement) to the Indemnified Party or the Indemnifying  Party (as applicable), which shall be provided a reasonable time prior to the proposed time for effecting such  settlement or compromise, and the Indemnifying Party or the Indemnified Party (as applicable) may not effect  any such settlement or compromise without the prior written consent of the Indemnified Party or the  Indemnifying Party (as applicable), such consent to not be unreasonably withheld, delayed or conditioned.  6.4 Survival. The representations and warranties contained in this Agreement and in the  Transaction Documents shall survive the Closing and shall survive until twelve (12) months following the  Closing Date, and shall thereafter cease to be of any force and effect, except for (a) claims based upon  representations and warranties as to which notice has been given in accordance with Section 6.3 hereof prior to  such date and that are pending on such date, (b) claims based upon representations and warranties set forth in  Section 4.9 (Tax Returns and Payments), Section 4.18 (Employee Benefit Plans and ERISA), Section 4.19  (Immigration Matters), Section 4.24 (Hazardous Substances) or the first sentence of Section 4.33 (Pandemic  Relief Program), each of which shall survive until sixty (60) days following the expiration of the respective  statute of limitations applicable thereto, and (c) claims based upon representations and warranties set forth in  Section 4.1 (Incorporation and Authority of Seller), Section 4.2 (Power and Authority; Due Authorization),  Section 4.3 (Title to Purchased Assets), Section 4.20 (Broker Fees and Expenses), Section 4.23 (No Affiliation),  Section 5.1 (Formation of Purchaser), Section 5.2 (Power and Authority; Due Authorization) or Section 5.5  (Broker Fees and Expenses) or any claim based on Fraud, each of which shall survive without limitation (the  representations and warranties described in clauses (b) and (c) of this Section, the “Exempt Representations and  Warranties”). All indemnification obligations of any party herein shall expressly survive the Closing. The  covenants contained in this Agreement and in the Transaction Documents shall survive the Closing and remain  in full force and effect until performed in accordance with their terms.  6.5 Escrow.  Except for claims with respect to Exempt Representations and Warranties or claims  for Fraud, intentional misrepresentation or criminal activity, and subject to the last sentence of this Section 6.5,  all indemnification obligations of the Seller or the Majority Shareholders pursuant to Section 6.1(a)(ii) shall be  satisfied solely by reclaiming the Escrow Amount in accordance with the terms of the Escrow Agreement. For  the avoidance of doubt, to the extent any indemnification payments are required for a claim based upon (i) a  breach of (A) Exempt Representations and Warranties, (B) Section 6.1(a)(i) or (C) Sections 6.1(b) – (i) or (ii)  claims for Fraud, intentional misrepresentation or criminal activity, Purchaser shall proceed first against the then  remaining amount of the Escrow Amount in accordance with the Escrow Agreement and thereafter, the Seller  and each Majority Shareholder will be liable, on a joint and several basis, for all such indemnification claims,  subject to the limitations provided in Section 6.6 hereof. In the event the Escrow Amount is utilized to satisfy  indemnification claims pursuant to clauses (i) or (ii) above and thereafter there are indemnification claims under  Section 6.1(a)(ii), the Seller and each Majority Shareholder shall be liable, on a joint and several basis, for all  such claims up to the amount of the Cap.  6.6 Limitations on Liability. Notwithstanding any other provisions of this Agreement or any of  the Transaction Documents to the contrary:  

 

35 17618573v10  (a) With respect to the matters described in Section 6.1(a)(ii) and Section 6.2(a)(ii), the  Seller and the Majority Shareholders, on one hand, and the Purchaser, on the other hand, shall not be liable to  a Purchaser Indemnitee or Seller Indemnitee, as applicable, for indemnification under this Article 6 until the  aggregate amount of all Losses suffered by the Purchaser Indemnitees or Seller Indemnitees, as applicable, in  respect of indemnification under this Article 6 exceeds $68,000 (the “Deductible”), in which event the  Indemnifying Party shall only be required to pay or be liable for Losses in excess of the Deductible; provided,  that, for the avoidance of doubt, the Deductible shall not apply in respect of any Losses relating to (i) breaches  of the Exempt Representations and Warranties, (ii) breaches of any covenants, (iii) any claim arising out of  Fraud or (iv) any claim relating to the matters described in Sections 6.1(b)-(i), 6.2(b) and 6.2(c).   (b) With respect to the matters described in Section 6.1(a)(ii) and Section 6.2(a)(ii), the  aggregate amount of all Losses for which an Indemnifying Party shall be liable shall not exceed $3,182,000  (the “Cap”); provided, that, for the avoidance of doubt, the Cap shall not apply in respect of any Losses relating  to (i) breaches of the Exempt Representations and Warranties, (ii) breaches of any covenants, (iii) any claim  arising out of Fraud or (iv) any claim relating to the matters described in Sections 6.1(b)-(i), 6.2(b) and 6.2(c),  in which cases the aggregate amount of all such Losses for which an Indemnifying Party shall be liable shall  not exceed the Purchase Price (other than to the extent arising out of Fraud).  (c) The parties shall be entitled to pursue without limitation any rights or remedies they  may have with respect to claims based on Fraud, whether involving the Seller or its personnel, any of the  Majority Shareholders, any of their respective Affiliates or any Related Parties of any of the foregoing, or  otherwise, and whether under this Agreement, at law or in equity. “Fraud” as used in this Article 6 shall mean  intentional or willful misrepresentation of material facts which constitute common law fraud under the laws of  the State of Delaware.  (d) Payments by an Indemnifying Party in respect of any Losses shall be limited to the  amount of any liability or damage that remains after deducting therefrom any insurance proceeds and any  indemnity, contribution or other similar payment received by the Indemnified Party in respect of any such claim,  net of all expenses incurred by them in recovering such proceeds from the insurance carrier and the amount of  any projected premium increases. The Indemnified Party shall use its commercially reasonable efforts to  recover under insurance policies or indemnity, contribution or other similar agreements for any Losses.  (e) Any Indemnification payments by an Indemnifying Party pursuant to any Losses shall  be reduced by an amount equal to any Tax benefit realized or reasonably expected to be realized as a result of  such Losses by the Indemnified Party.  (f) Other than with respect to any claim arising out of Fraud, in no event shall any  Indemnifying Party be liable to any Indemnified Party for any punitive, incidental, special or indirect damages,  or any consequential damages not reasonably foreseeable except to the extent such damages are awarded by a  court of competent jurisdiction to a third party pursuant to a Third Party Claim as determined by a Final  Determination in connection therewith. “Final Determination” means, with respect to a dispute, an occurrence  where (i) the parties to the dispute have reached an agreement in writing, (ii) a court of competent jurisdiction  shall have entered a final and non-appealable order or judgment with respect to a claim or (iii) an arbitration or  like panel shall have rendered a final non-appealable determination with respect to disputes the parties have  agreed to submit thereto.  (g) Each Indemnified Party shall take, and cause its Affiliates to take, all reasonable steps  to mitigate any Loss upon becoming aware of any event or circumstance that would be reasonably expected to,  or does, give rise thereto, including incurring costs only to the minimum extent reasonably necessary to remedy  the breach that gives rise to such Loss  

 

36 17618573v10  6.7 Materiality Disregarded.  All materiality qualifications contained in the representations and  warranties of the parties set forth in this Agreement (however they may be phrased and including the term  “Material Adverse Effect”) shall be taken into account for purposes of this Article 6 solely for purposes of  determining whether a breach of, or inaccuracy in, such representation and warranty has occurred and, if such  breach or inaccuracy has occurred, all such materiality qualifications shall be ignored and not given any effect  for purposes of determining the amount of Losses arising out of or relating to such breach of, or inaccuracy in,  such representation and warranty for purposes of this Article 6.  6.8 Exclusive Remedy.  Except with respect to an action based upon an allegation of Fraud or with  respect to which equitable relief is sought (and solely to the extent such action is based on the allegation of Fraud  or seeks equitable relief) or as otherwise provided in this Agreement, the provisions of this Article 6 constitute  the exclusive remedy of the parties hereto with respect to the matters covered under Sections 6.1 and 6.2.  6.9 Tax Treatment of Indemnity.  All indemnification payments made under this Agreement  shall be treated by the parties as an adjustment to the Purchase Price for Tax purposes, unless otherwise required  by Law.  ARTICLE 7  CLOSING DELIVERIES TO PURCHASER  7.1 Closing Deliveries.  Effective as of the Closing, the Seller and the Majority Shareholders shall  have executed, and shall have caused the Shareholders to have executed (where applicable), and delivered to  the Purchaser each of the following, together with any additional items that the Purchaser may reasonably  request to effect the transactions contemplated herein: (a) possession of the Purchased Assets;  (b) a Bill of Sale, in substantially the same form as attached hereto as Exhibit 7.1(b)(i), an  Assignment and Assumption Agreement, in substantially the same form as attached hereto as Exhibit 7.1(b)(ii) (the “Assignment Agreement”), and such additional instruments of sale, transfer, conveyance, and assignment  duly executed by the Seller and each Affiliated Trucking Company as of the Closing Date, as reasonably  requested by the Purchaser to consummate the transactions described herein;   (c) a copy, certified by the Seller’s secretary, of (i) the articles of incorporation and bylaws  of the Seller, (ii) the resolutions of the board of directors of the Seller and its Shareholders, authorizing the  transactions contemplated hereby and by the Transaction Documents and the execution, delivery and  performance by the Seller of this Agreement and the Transaction Documents, and (iii) an incumbency certificate  with respect to the officers executing documents or instruments on behalf of the Seller;  (d) the Noncompetition Agreements, duly executed by the Seller and each of those  Shareholders listed on Schedule 3.8;  (e) the Transition Services Agreement, duly executed by the Seller and each Affiliated  Trucking Company;    (f) with respect to each Key Employee, an Employment Agreement, duly executed by  such Key Employee;  (g) with respect to the Leased Real Property located at 7418 Ranco Road, Richmond,  Virginia 23228 (the “Headquarters”), a lease agreement by and between the Purchaser, as tenant, and Poiner  

 

37 17618573v10  Realty, LLC (“Poiner Realty”), an Affiliate of the Seller, as landlord, substantially in the form attached hereto  as Exhibit 7.1(g) (the “New Lease”), duly executed by Poiner Realty;  (h) payoff letters from each creditor of the Seller and releases and termination statements  in respect of all Encumbrances (other than Permitted Encumbrances) encumbering the Purchased Assets, all in  form and substance satisfactory to the Purchaser;  (i) a good standing certificate for the Seller, issued by the Secretary of State of the State  (or equivalent) of each jurisdiction listed on Schedule 4.1;   (j) a non-foreign affidavit for the Seller, dated as of the Closing Date, sworn under penalty  of perjury and in form and substance required under the Treasury Regulations issued pursuant to Section 1445  of the Code stating that the Seller is not a “foreign person” as defined in Section 1445 of the Code;  (k) a certificate from the Majority Shareholders certifying as to the matters set forth in  Sections 9.1(a) and (b) hereof;  (l) evidence of termination of each Related Party Transaction identified on Schedule  7.1(l); and  (m) any other documents or agreements reasonably requested by the Purchaser to carry out  the transactions contemplated by this Agreement.  ARTICLE 8  CLOSING DELIVERIES TO THE SELLER  8.1 Closing Deliveries.  Concurrently with the execution of this Agreement, the Purchaser or its  Affiliates shall have delivered to the Seller each of the following, together with any additional items which the  Seller may reasonably request to effect the transactions contemplated herein: (a) the Closing Cash Payment;  (b) the Closing Date Inventory Payment;  (c) the Noncompetition Agreements, duly executed by the Purchaser;  (d) the Employment Agreements, duly executed by the Purchaser;  (e) the Transition Services Agreement, duly executed by the Purchaser;  (f) the Assignment Agreement, duly executed by the Purchaser;  (g) the New Lease, duly executed by the Purchaser;  (h) a certified copy of the resolutions of the directors of the Purchaser authorizing the  execution, delivery and performance of this Agreement and the Purchaser Transaction Documents by the  Purchaser, as applicable, and an incumbency certification with respect to the officers of the Purchaser executing  documents or instruments on behalf of the Purchaser;   (i) a certificate from the authorized signatories of the Purchaser certifying as to the matters  set forth in Sections 9.2(a) and (b) hereof; and  

 

38 17618573v10  (j) any other documents or agreements contemplated hereby  ARTICLE 9.  CONDITIONS TO CLOSING AND TERMINATION  9.1 Conditions to Obligations of the Purchaser.  The obligations of the Purchaser to consummate  the transactions contemplated hereby on the Closing Date will be subject to the fulfillment (or express waiver  in writing by the Purchaser) of the following conditions on or before the Closing Date:  (a) Representations and Warranties True.  (i) The representations and warranties of the  Seller and the Majority Shareholders hereunder (other than Exempt Representations and Warranties) shall have  been true and correct at and as of the date hereof and shall be materially true and correct at and as of the Closing  Date as if made at and as of the Closing Date and (ii) the Exempt Representations and Warranties shall be true  and correct in all respects as of the date hereof other than in de minimis respects and as of the Closing Date as  though then made.  (b) Obligations Performed.  The Seller and the Majority Shareholders shall have  performed and complied with all agreements, conditions and obligations required by this Agreement to be  performed or complied with by them prior to or at the Closing.  (c) Consents.  The Seller and the Majority Shareholders shall have obtained and delivered  to the Purchaser the written consents listed on Schedule 9.1(c), and all of such consents shall remain in full  force and effect at and as of the Closing.  (d) Deliveries.  The Seller and the Majority Shareholders shall have executed (where  applicable) and delivered to the Purchaser each of the items required by Article 7 hereof.  (e) No Challenge.  There shall not be pending or threatened any action, proceeding or  investigation before any court or administrative agency by any government agency, or be any pending action  by any other Person, in which it is sought to restrain or prohibit, or obtain damages in connection with, the sale  by the Seller or the acquisition by the Purchaser of the Purchased Assets pursuant to this Agreement and the  Transaction Documents or the ability of the Purchaser or any of its Affiliates to own and operate the Purchased  Assets.  (f) No Material Adverse Effect.  Since the date hereof, there shall have been no Material  Adverse Effect, whether or not reflected in the Seller’s financial statements or the Schedules hereto or  otherwise.  (g) Regulatory Matters.  The regulatory filings and approvals listed on Schedule 9.1(g)  shall have been made and obtained.  (h) Fuel Tank. Poiner Realty shall, at its sole cost and expense, have emptied all contents,  including any fuel, from the Fuel Tank.   Notwithstanding anything to the contrary contained herein, if the Purchaser elects to  consummate any of the transactions contemplated by this Agreement or any of the Transaction Documents  notwithstanding the failure of one or more of the conditions precedent set forth in Sections 9.1(b) – (h), the  Purchaser shall not retain any of, and shall be deemed to have waived, its rights and remedies under Article 6  with respect to any Losses incurred or suffered by any Purchaser Indemnitee arising out of or resulting from  the failure of any such conditions precedent. For the avoidance of doubt, if the Purchaser elects to consummate  any of the transactions contemplated by this Agreement or any of the Transaction Documents notwithstanding  

 

39 17618573v10  the failure of the condition precedent set forth in Sections 9.1(a), the Purchaser shall retain all its rights and  remedies under Article 6 with respect to any Losses incurred or suffered by any Purchaser Indemnitee arising  out of or resulting from the failure of any such condition precedent.  9.2 Conditions to Obligations of the Seller and the Majority Shareholders.  The obligations of  the Seller and the Majority Shareholders to consummate the transactions contemplated hereby on the Closing  Date will be subject to the fulfillment (or express waiver in writing by the Seller and the Majority Shareholders)  of the following conditions on or before the Closing Date:  (a) Representations and Warranties True. (i) The representations and warranties of the  Purchaser hereunder (other than Exempt Representations and Warranties) shall have been true and correct at  and as of the date hereof and shall be materially true and correct at and as of the Closing Date as if made at and  as of the Closing Date and (ii) the Exempt Representations and Warranties shall be true and correct in all  respects as of the date hereof other than in de minimis respects and as of the Closing Date as though then made.  (b) Obligations Performed.  The Purchaser shall have performed and complied with all  agreements, conditions and obligations required by this Agreement to be performed or complied with by  Purchaser prior to or at the Closing.  (c) Deliveries.  The Purchaser shall have executed (where applicable) and delivered to the  Seller each of the items required by Article 8 hereof.  (d) No Challenge.  There shall not be pending or threatened any action, proceeding or  investigation before any court or administrative agency by any government agency, or be any pending action  by any other Person, in which it is sought to restrain or prohibit, or obtain damages in connection with, the sale  by the Seller or the acquisition by the Purchaser of the Purchased Assets pursuant to this Agreement and the  Transaction Documents.  9.3 Termination.  This Agreement may be terminated at any time before the Closing Date:  (a) by mutual written consent of the Purchaser and the Seller;  (b) by the Purchaser if there occurs a Material Adverse Effect;  (c) by any non-breaching party hereto if there has been a material breach of any  representation, warranty, covenant or agreement contained in this Agreement on the part of any other party  hereto and such breaching party shall fail to cure such breach within ten (10) days of receipt of written notice  identifying the breach with reasonable specificity; or  (d) by either the Purchaser or the Seller if the Closing has not occurred by June 1, 2022,  through no fault of the terminating party or its Affiliates.   9.4 Effects of Termination. In the event this Agreement is terminated pursuant to Section 9.3(a),  (b) or (d), no party shall have any further obligations to the others hereunder.  In the event of a termination of  this Agreement pursuant to Section 9.3(c), the terminating party and any other party not in breach hereof shall  retain all of its rights and remedies under this Agreement and those available at law or in equity. For the  avoidance of doubt, if Seller terminates this Agreement pursuant to Section 9.3(c) or if the conditions set forth  in Section 9.1 hereof have been satisfied or validly waived but the Closing has not occurred pursuant to Section  2.3 hereof, Seller shall be entitled to receipt of the Escrow Amount pursuant to Section 2.1(b) hereinabove.  

 

40 17618573v10  ARTICLE 10  MISCELLANEOUS PROVISIONS  10.1 Severability.  If any provision of this Agreement is prohibited by the Laws of any jurisdiction  as those Laws apply to this Agreement, that provision shall be ineffective to the extent of such prohibition or  shall be modified to conform with such Laws, without invalidating the remaining provisions hereto. 10.2 Modification and Waiver.  This Agreement may not be changed or modified except in writing  specifically referring to this Agreement and signed by the Purchaser, the Seller and the Majority Shareholders.   No change, amendment or attempted waiver of any provision hereof shall be binding on the other parties unless  reduced to writing and signed by all of the parties hereto. Unless specifically provided otherwise herein or  agreed to by such parties hereto in writing, no modification, waiver, termination, rescission, discharge or  cancellation of this Agreement shall affect the right of the parties hereto to enforce any claim, whether or not  liquidated, which accrued prior to the date of such modification, waiver, termination, rescission, discharge or  cancellation of this Agreement, and no waiver of any provision or of any default under this Agreement shall  affect the right of any party to enforce such provision or to exercise any right or remedy in the event of any  other default, whether or not similar. 10.3 Assignment, Survival and Binding Agreement.  This Agreement may not be assigned by any  party hereto without the prior written consent of the other parties; provided that, without the consent of the  Seller or the Majority Shareholders, the Purchaser may (i) assign this Agreement and the Purchaser Transaction   Documents in whole or in part to one or more of its Affiliates or in connection with a merger, consolidation,  sale of assets or sale of stock of the Purchaser or (ii) if requested by the Purchaser’s lender, grant a security  interest in, and collateral assignment of, its rights under this Agreement and the Purchaser Transaction   Documents to secure the obligations of the Purchaser to such lender.  The terms and conditions hereof shall  survive the Closing as provided herein and shall inure to the benefit of and be binding upon the parties hereto  and their respective heirs, personal representatives, successors and permitted assigns. 10.4 Counterparts.  This Agreement may be executed in one or more counterparts, each of which  shall be deemed an original, but all of which together shall constitute one and the same instrument, with the  same effect as if the signatures thereto were in the same instrument.  Signature pages exchanged by facsimile,  “pdf” or other electronic means shall be fully binding.  This Agreement shall be effective and binding on all  parties when all parties have executed and delivered a counterpart of this Agreement. 10.5 Notices.  All notices, requests, demands, claims or other communications hereunder will be in  writing and shall be deemed duly given if personally delivered, sent by facsimile, email, “pdf” (if sent by  facsimile, email, or “pdf”, such electronic copy to be promptly followed by hardcopy) or sent by a recognized  overnight delivery service that guarantees next day delivery (“Overnight Delivery”) or mailed registered or  certified mail, return receipt requested, postage prepaid, in each case transmitted or addressed to the intended  recipient as set forth below: If to the Seller or the Sealand Food Inc.                                           Majority Shareholders: 7418 Ranco Road  Richmond, VA 23228  Email:tammyl@sealandfoodsinc.com  with a copy to: Ellenoff Grossman & Schole LLP  (which shall not constitute 1345 Avenue of the Americas  notice)  New York, New York 10105  Facsimile: (212) 370-7889  Attn:  Jonathan Cramer, Matthew Gray and Sophia Song  

 

41 17618573v10  Email: jcramer@egsllp.com, mgray@egsllp.com and  ssong@egsllp.com If to Purchaser:  HF Foods Group Inc.  19317-19319 Arenth Avenue  City of Industry, California 91748  Facsimile:  (909) 718-8722  Attn: Victor Lee  Email: victorlee@hffoodsgroup.com with a copy to:  Arnall Golden Gregory LLP  (which shall not constitute  171 17th Street, NW, Suite 2100  notice)  Atlanta, Georgia  30363  Facsimile:  (404) 873-8151  Attn: Sean P. Fogarty, Esq.  Email: sean.fogarty@agg.com  or at such other address as any party hereto notifies the other parties hereof in writing.  The parties hereto agree  that notices or other communications that are sent in accordance herewith (i) by personal delivery, facsimile,  email or “pdf”, will be deemed received on the day sent or on the first Business Day thereafter if not sent on a  Business Day, (ii) by Overnight Delivery, will be deemed received on the first Business Day immediately  following the date sent, and (iii) by U.S. mail, will be deemed received three (3) Business Days immediately  following the date sent.  For purposes of this Agreement, a “Business Day” is a day on which the Purchaser is  open for business and shall not include a Saturday or Sunday or legal holiday.  Notwithstanding anything to the  contrary in this Agreement, in the event an action required or permitted by this Agreement is to be taken by a  certain date (e.g., ten (10) days after Closing) and such date is not a Business Day, such action may be performed  on the next succeeding day that is a Business Day.  10.6 Entire Agreement; No Third Party Beneficiaries.  This Agreement, together with the  Exhibits and Schedules attached hereto, the Confidentiality Agreement, the Transaction Documents and the  Purchaser Transaction Documents, constitutes the entire agreement and supersedes any and all other prior  agreements and undertakings, both written and oral, among the parties, or any of them, with respect to the  subject matter hereof and, except as otherwise expressly provided herein, is not intended to confer upon any  Person other than the Purchaser, the Seller and the Shareholders any rights or remedies hereunder; provided,  however, that the Purchaser Indemnitees and the Seller Indemnitees are intended third party beneficiaries of  Article 6, entitled to enforce the terms thereof directly as if they were direct parties hereto.  10.7 Further Assurances.  The parties to this Agreement agree to execute and/or deliver, both  before and after the Closing, any additional information, documents or agreements and to take all actions  contemplated hereby or necessary or appropriate to effect and consummate the transactions contemplated  hereby.  Each party hereto agrees to provide to the other parties hereto, both before and after the Closing, such  information as the requesting party may reasonably request in order to consummate the transactions  contemplated hereby and to effect an orderly transition of the Business following the Closing.  10.8 Construction.  Within this Agreement, the singular shall include the plural and the plural shall  include the singular and any gender shall include all other genders, all as the meaning and context of this  Agreement shall require, and the word “including” shall be interpreted to mean “including, without limitation.”   In connection with any action or event that by the terms hereof requires consent of a party hereto, such consent  shall not be unreasonably withheld or delayed.  The words “herein,” “hereof” and “hereunder” and other words  of similar import refer to this Agreement as a whole, including the Exhibits and Schedules hereto, as the same  

 

42 17618573v10  may be amended, modified or supplemented from time to time, and not to any particular section, subsection or  clause contained in this Agreement.  Unless otherwise indicated, a reference to a Section, Schedule or Exhibit  means a Section, Schedule or Exhibit hereof.  Should any provision of this Agreement require interpretation, it  is agreed that the arbitration panel or other body interpreting or construing this Agreement shall not apply the  assumption that the terms of this Agreement shall be more strictly construed against one party by reason of the  rule of legal construction that an instrument is to be construed more strictly against the party which itself or  through its agents prepared the agreement.  The parties acknowledge and agree that they and their agents have  each had the opportunity to participate equally in the negotiations and preparation of this Agreement and have  had the opportunity to consult legal counsel regarding the terms hereof.  10.9 Choice of Law. This Agreement and all documents executed in connection therewith shall be  governed by, and construed in accordance with, the laws of the State of Delaware, regardless of the laws that  might otherwise govern under applicable principles of conflict of laws thereof.  10.10 Dispute Resolution.  Notwithstanding any provision of this Agreement to the contrary, with  the exception of where the sole remedy sought is injunctive relief, all disputes, controversies or claims arising  out of or relating to this Agreement, the Transaction Documents, the Purchaser Transaction Documents or the  transactions contemplated hereby or thereby shall be resolved by agreement among the parties, or, if not so  resolved within forty-five (45) days following written notice of dispute given by any party hereto to the other  parties hereto, and if written notice of the desire to arbitrate is given by any of the parties as provided below  and the matter is not then otherwise resolved by the parties hereto, by resort to arbitration in accordance with  Title 9 of the United States Code (the United States Arbitration Act) and the Commercial Arbitration Rules, all  as amended from time to time (the “Rules”) of the American Arbitration Association and the provisions of this  Section; provided, however, that the provisions of this Section shall prevail in the event of any conflict with  such Rules.  The parties agree that they shall use their respective best efforts to cause the matter to be presented  to a panel of three arbitrators (at least one of whom shall have at least ten (10) years of industry experience  relating to the subject matter of the dispute) within thirty (30) days after the establishment of such panel.  Such  panel shall consist of one arbitrator selected by the Purchaser, one arbitrator selected by the Seller, and a third  arbitrator selected by the two arbitrators so selected, who shall act as chairman of the panel; provided that each  arbitrator shall be independent.  The parties shall be entitled to engage in discovery in connection with  arbitration, which discovery shall be conducted in accordance with the Federal Rules of Civil Procedure.   Pending the arbitration hearing, any provisional remedy that would be available to a party from a court of law  shall be available from the arbitration panel.  The decision of a majority of the arbitration panel with respect to  the matters referred to them pursuant hereto shall be final and binding upon the parties to the dispute, subject  to any rights of appeal under the Rules, and confirmation and enforcement thereof may be rendered thereon by  any court having jurisdiction upon application of any Person who is a party to the arbitration proceeding.  The  costs and expenses incurred in the course of such arbitration, including reasonable attorneys’ fees, shall be  borne by the party or parties against whose favor the decisions and conclusions of the arbitration panel are  rendered; provided, however, that if the arbitration panel determines that its decisions are not rendered wholly  against the favor of one party or parties or the other, the arbitration panel shall be authorized to apportion such  costs and expenses in the manner that it deems fair and just in light of the merits of the dispute and its resolution.   The arbitration panel shall have no power or authority under this Agreement or otherwise to award or provide  for the award of punitive damages against any party, and the parties agree to eliminate punitive damages as a  remedy, and waive any and all claims for punitive damages based on punitive conduct.  Any arbitration shall  be conducted in Las Vegas, Nevada.  10.11 Specific Performance. The parties agree that irreparable damage would occur if any provision  of this Agreement were not performed in accordance with the terms hereof and that, subject to and pending the  conclusion of any arbitration proceeding commenced pursuant to Section 10.10 hereof, the parties shall be  entitled to specific performance of the terms hereof, in addition to any other remedy to which they are entitled  at law or in equity.  Any action or proceeding for any such remedy shall be brought in any state or federal courts  

 

43 17618573v10  having proper jurisdiction (and any appellate court therefrom), and each party waives (i) any objection that it  may have to the venue of any such action or proceeding, and (ii) any requirement for the securing or posting of  any bond in connection with any such remedy.  10.12 Definition of Knowledge.  As used in this Agreement, “knowledge of the Seller”, “to the  Seller’s knowledge” or similar terms mean the actual knowledge of Connie Wang and Tammy Lu, together  with such additional knowledge that such person would be reasonably expected to obtain after making  reasonable inquiry with respect to the applicable matter.   10.13 Schedules and Exhibits.  All Schedules and Exhibits referenced in this Agreement, whether  attached hereto or not, shall be deemed to be a part of this Agreement, and this Agreement shall be construed  in accordance therewith.  10.14 Defined Terms.  The following terms have the meanings assigned to such terms in the Sections  of this Agreement set forth below:   Term Section  Actual Inventory 3.10(d)  Acquisition Proposal 3.14  Affiliate 4.23  Affiliated Trucking Companies Recitals  Agreement Preamble  Apportioned Obligations 2.4  Assigned Assets 1.1(a)  Assigned Assets and Vehicles 4.11  Assigned Contracts 1.1(d)  Assignment Agreement 7.1(b)  Assumed Liabilities 2.2(a)  Business Recitals  Business Day 10.5  Business Employees 4.18(a)  Cap 6.6(b)  CARES Act 4.33  Closing 2.3  Closing Cash Payment 2.1(a)  Closing Date 2.3  Closing Date Inventory  Payment  3.10(b)  COBRA 4.18(d)  Code 3.3(a)(i)  Confidentiality Agreement 3.6  Consideration Allocation 3.3(h)  Contract 4.14  Control 4.23  Cost-Plus Contract Claims 4.26  Cost-Plus Contracts 4.26  Current Employees 3.1(c)  Deductible 6.6(a)  DHS 4.6  disclosing party 3.6  Term Section  Dispute Notice 6.3(a)  Employee Benefit Plan 4.18(a)  Employment Agreements 3.1(b)  Encumbrances 1.3  Environmental Laws 4.24  Environmental Reports 4.24(l)  ERISA 4.18(a)  ERISA Affiliate 4.18(a)  ERISA Affiliate Employee  Benefit Plan  4.18(c)(i)  Escrow Agent 2.1(b)  Escrow Agreement 2.1(b)  Escrow Amount 2.1(b)  Escrow Release Date 2.1(b)  Excess 3.10(d)  Excluded Assets 1.2  Excluded Liabilities 2.2(b)  Exempt Representations and  Warranties  6.4  Express Light Recitals  Final Determination 6.6(f)  FMLA 4.18(d)  Fraud 6.6(c)  GAAP 4.8(b)  Hazardous Material 4.24  Historical Financials 4.8(a)  Indemnified Party 6.3(a)  Indemnifying Party 6.3(a)  Inspection Date 3.10(a)  Intellectual Property 1.1(b)  Inventory 3.10(a)  Inventory Payments 3.10(b)  IRCA 4.19(a)  

 

17618573v10  Term Section  IRS 4.9(a)  Key Employees 3.1(b)  knowledge of the Seller 10.12  Laws 2.2(b)(v)  Leased Real Property 4.25(a)  Leases 4.25(a)  Licenses 4.7  Losses 6.1  Majority Shareholders Preamble  Material Adverse Effect 4.8(b)  Material Contracts 4.14  Milestone Express Recitals  New Lease 7.1(g)  Noncompetition Agreements 3.8  Notice of Claim 6.3(a)  Overnight Delivery 9.5  Owned Intellectual Property 1.1(b)  Pandemic Relief Program 4.33  Parent Preamble  Permitted Encumbrances 1.3  Person 3.3(a)(ii)  Personal Information 4.28  Poiner Realty 7.1(g)  Post-Closing Tax Period 3.3(a)(iii)  Potential Successor Tax 3.3(a)(iv)  PPP Loan 4.33  PPP Loan Liabilities 4.33  Pre-Closing Inventory 3.10(a)  Pre-Closing Inventory Value 3.10(a)  Pre-Closing Tax Period 3.3(a)(v)  Property Taxes 2.4  Purchase Price 2.1  Purchased Assets 1.1  Purchaser Indemnitees 6.1  Purchaser Transaction  Documents  5.2  Purchaser Preamble  Term Section  Qualifying Event 4.18(d)  receiving party 3.6  Registered Intellectual  Property  4.12(a)  Related Party 4.23  Release 4.24  Remaining Inventory Payment 3.10(b)  Rules 10.10  Saleable 3.10(c)  Sales and Use Taxes 2.4  Sanctioned Country 4.35  Sanctions 4.35  SBA 4.33  Schedule Supplement 3.15  Seller Indemnitees 6.2  Seller Preamble  Shareholders Recitals  Shortfall 3.10(d)  SSA 4.19(f)  Straddle Period 3.3(a)(vi)  Tax 3.3(a)(ix)  Tax Authority 3.3(a)(vii)  Tax Return 3.3(a)(viii)  Taxes 3.3(a)(ix)  Third Party Claim 6.3(b)(i)  to the Seller’s knowledge 10.12  Top Customers 4.32  Top Suppliers 4.32  Transaction Documents 4.2  Transition Period 3.1(a)  Transition Services Agreement 3.1(a)  USDA 4.6  Value 3.10(a)  Vehicles 1.1(f)  [Signatures on following page]  

 

 

 

 

 

17618573v10  SCHEDULES AND EXHIBITS  Schedule 1.1(a) Assigned Assets  Schedule 1.1(b) Intellectual Property  Schedule 1.1(d) Assigned Contracts  Schedule 1.1(e) Licenses and Permits  Schedule 1.1(f) Vehicles  Schedule 1.1(i) Other Assets  Schedule 1.2(c) Excluded Contracts  Schedule 1.2(i) Additional Items  Schedule 1.3 Permitted Encumbrances  Schedule 3.1(b) Key Employees  Schedule 3.1(c) Other Employees  Schedule 3.3(h) Consideration Allocation  Schedule 3.8 Certain Shareholders  Schedule 4.1 Incorporation and Authority of Seller  Schedule 4.3 Title to Purchased Assets  Schedule 4.4 Consents  Schedule 4.5 Ownership  Schedule 4.6 Compliance with Laws  Schedule 4.11 Assets and Vehicles  Schedule 4.14 Material Contracts  Schedule 4.15 Litigation  Schedule 4.16 Insurance Policies  Schedule 4.17 Employees  Schedule 4.18(a) Employee Benefit Plan  Schedule 4.18(b)  ERISA  Schedule 4.18(d) COBRA  Schedule 4.19(d) Nonimmigrant Visa Status  Schedule 4.23 Related Party Transactions  Schedule 4.25(a) Leased Real Property  Schedule 4.32 Top Customers and Suppliers  Schedule 4.33 Pandemic Relief Program  Schedule 4.34 COVID-19 and COVID-19 Measures  Schedule 7.1(m) Related Party Transactions – Terminations  Exhibit 2.1(b) Escrow Agreement  Exhibit 3.1(a) Transition Services Agreement  Exhibit 3.1(b) Form of Employment Agreement  Exhibit 3.8(a) Form of Seller Noncompetition Agreement  Exhibit 3.8(b) Form of Shareholder Noncompetition Agreement  Exhibit 7.1(b)(i) Bill of Sale  Exhibit 7.1(b)(ii) Assignment Agreement  Exhibit 7.(h) Form of New Lease  

 

17618573v10  Exhibit 3.1(a)  Transition Services Agreement  (See attached)  

 

{01102524.DOCX.2}  17629381v6  TRANSITION SERVICES AGREEMENT  THIS TRANSITION SERVICES AGREEMENT (this “Agreement”), dated this ____ day of  April, 2022, is entered into by and among (a) (i) Sealand Food, Inc., a Maryland corporation (the “Seller”),  (ii) Connie Wang, but only with respect to Section 8(c) below (“C. Wang”), and (iii) Jenny Wang, but only  with respect to Section 8(c) below (“J. Wang”, and together with C. Wang, the “Majority Shareholders”);  and (b) Great Wall Seafood VA, L.L.C., a Virginia limited liability company (the “Purchaser”).    W I T N E S S E T H:  WHEREAS, effective as of the date hereof, the Purchaser acquired certain of the assets of the Seller  used in the conduct of the Business pursuant to that certain Asset Purchase Agreement, dated as of April  ___, 2022, by and among the Seller, the Purchaser and the other parties thereto (the “Asset Purchase  Agreement”; all capitalized terms not otherwise defined herein shall have the respective meanings ascribed  to them in the Asset Purchase Agreement); and  WHEREAS, effective as of the date hereof, the Purchaser entered into a real property lease with  Poiner Realty, LLC, a Virginia limited liability company and an affiliate of the Seller (“Poiner”), for the  facility owned by Poiner and used in the operation of the Business (the “Leased Real Property”) to allow  for the Purchaser’s assumption and operation of the Business at the Leased Real Property;  WHEREAS, to assist with the transition of the Seller’s Business to the Purchaser, the Seller has  agreed to operate and manage the Business at the Leased Real Property on behalf, and for the benefit, of  the Purchaser, on such terms and conditions as set forth in this Agreement.   NOW THEREFORE, for and in consideration of the mutual promises and covenants of the parties  contained in this Agreement and the consummation of the transactions contemplated by the Asset Purchase  Agreement, and other good and valuable consideration, the receipt and sufficiency of which is hereby  acknowledged and confessed, the parties, intending to be legally bound, agree to the following:  1. Term.  (a) Subject to Section 1(b) below, the term of this Agreement shall commence on the date  hereof and continue until the date that is thirty (30) days following the date hereof (the “Initial Term”);  provided; however, that the Purchaser may extend such term for one (1) thirty (30) day period; provided,  further, however that the Purchaser may extend the term for additional thirty (30) day periods if there are  regulatory or licensure circumstances beyond the Purchaser’s reasonable control necessitating such  additional thirty (30) day extensions until such time that the regulatory or licensure issue is resolved;  provided that the Purchaser uses its commercially reasonable efforts to resolve such issue as expeditiously  as possible (each, an “Extension Term”, and such Initial Term as it may extended, the “Transition Period”)  by delivering written notice thereof to the Seller at least ten (10) days prior to the expiration of the Initial  Term or the then current Extension Term, as applicable.   (b) In the event of a material breach of this Agreement, the non-breaching party may terminate  this Agreement by delivering written notice to the breaching party.  Such termination will become effective  fifteen (15) days from the date of receipt of such written notice unless the breach is cured to the reasonable  satisfaction of the non-breaching party within such fifteen (15) day period.  The Purchaser may terminate  this Agreement at any time for any reason whatsoever, or for no reason, upon ten (10) days’ written notice  to the Seller.  Upon the expiration or earlier termination of this Agreement, this Section 1(b) and Sections  3, 4, 5, 6, 7, 8, 10, 11, 12, 13, and 14 inclusive, will continue in full force and effect.    

 

{01102524.DOCX.2} 17629381v6  2 2. Transition Services.  (a) During the Transition Period and on the terms and subject to the conditions of this  Agreement, the Seller shall, and shall cause the Affiliated Trucking Companies to, continue to operate and  manage the Business in substantially the same manner in which the Seller operated the Business prior to  the date hereof (the operation and management of the Business shall be referred to herein as the “Transition  Services”).  The Transition Services shall include, but not be limited to:  (i) (A) The Seller will provide to the Purchaser access and use of the services of  those employees and independent contractors listed on Schedule 2(a)(i)(A), which Seller  acknowledges is all of the Seller’s employees and independent contractors utilized in the  Business by the Seller prior to the date hereof (with the exception of the Key Employees  who have accepted employment with Purchaser) (the “Leased Workers”) to provide  management, administrative, logistical, and technical services, in addition to those  described in clause (ii) below, to the Purchaser.  Each Leased Worker who is an employee  of the Seller shall devote one hundred percent (100%) of normal working hours each week  to the Purchaser during the Transition Period;   (B) The Leased Workers shall remain subject to the terms of their at-will  employment with the Seller.  The Seller will not terminate any Leased Worker without the  written consent of the Purchaser, except in situations that require immediate discharge to  preserve the integrity, safety, or general security of the workplace, the employees, or the  Purchased Assets.  The Seller shall give the Purchaser prompt written notice of any  resignation or other termination of any Leased Worker;  (C) Each Leased Worker shall receive base salary or wages and other  compensation consistent with the Seller’s practices, all of which shall be paid by the Seller;  provided, however, that a Leased Worker shall not receive an increase in base salary or  wages or any bonus or incentive compensation during the Transition Period, except as  approved by the Purchaser; and  (D) The Seller shall administer and/or provide all employer services with  respect to the Leased Workers, including, without limitation (I) payment of salary/wages  and employee benefits; (II) payroll processing services; and (III) administration of required  federal, state, and local employee payments or withholding from wages, including  remittance of employment taxes to federal, state, and local taxing authorities.  (ii) The Seller shall use commercially reasonable efforts to cause the Leased Workers  to perform the following duties for the benefit of the Purchaser, in the same manner as it performed  such duties for the Seller’s benefit prior to the Closing:  (A) servicing all customers of the Business in the same manner as such  customers were serviced prior to the Closing, including without limitation, (1) using the  same facilities, assets and employees in connection with such servicing and (2) using the  same level of efforts as the Seller’s employees used prior to the Closing to collect all vendor  and trade accounts receivable arising from the Business on or after the Closing (the  “Accounts Receivable”) for the sole benefit of the Purchaser; and  (B) operating and maintaining the human resources, security, employee/labor,  administrative, payroll, accounting/financial, invoicing/billing, safety, risk management,  tax, computer hardware/software, data storage/retrieval, information management,  communication, buying/merchandising, marketing/sales, customer service, transportation,  

 

{01102524.DOCX.2} 17629381v6  3 shipping and receiving (including, without limitation, all physical labor aspects such as  loading and unloading, packaging and unwrapping and slotting and picking of all  products), and inventory functions and systems of and all other assets utilized by the  Business prior to the Closing, whether or not such assets, functions and systems were  purchased by the Purchaser under the Asset Purchase Agreement.  (iii) providing access to and use of the employees and independent contractors of the  Affiliated Trucking Companies in connection with providing the Transition Services and assisting  in the transition of all employee and independent contractor relationships of the Business and using  commercially reasonable efforts to keep such relationships intact;  (iv) providing assistance to the Purchaser to retain the customer, supplier, vendor,  service provider and other business relationships of the Business and complying with all  commercially reasonable requests of the Purchaser with respect to such retention efforts;  (v) utilizing, engaging and compensating the Affiliated Trucking Companies in  substantially the same manner as the Affiliated Trucking Companies were utilized, engaged and  compensated by the Seller prior to the Closing;   (vi) maintaining all employment practices liability insurance and workers’  compensation insurance coverages pursuant to the same insurance policies with respect to the  Business and its employees as in effect immediately prior to the Closing (or renewals thereof).  In  connection with the foregoing, effective as of the Closing Date, the Seller and the Affiliated  Trucking Companies agree to promptly add the Purchaser as an additional insured on all such  policies and shall promptly provide the Purchaser with evidence of same; and  (vii) maintaining all Licenses necessary to operate the Business, including those  Licenses set forth on Schedule 2(a)(vii), in the same manner in which such Licenses were  maintained immediately prior to the Closing, and assisting the Purchaser with, as may be  applicable, (A) the transition of the Seller’s Licenses to the Purchaser and (B) obtaining new  Licenses in the name of the Purchaser.  (b) During the Transition Period, the Purchaser agrees to maintain commercial general liability  and other insurance coverages consistent with what insurance coverages were in place prior to Closing  (aside from employment practices liability insurance and workers’ compensation insurance coverage  maintained by the Seller in accordance with Section 2(a)(vi) above).  In connection with the foregoing,  effective as of the Closing Date, the Purchaser agrees to promptly add the Seller as an additional insured  on all such policies and shall promptly provide the Seller with evidence of same.  (c) During the Transition Period, the Seller shall, and shall cause the Affiliated Trucking  Companies to, work with the Purchaser to complete the assignment to the Purchaser of all Vehicles and  Contracts, including those listed on Schedule 2(c), with respect to the Vehicles and Contracts that were not  transferred to the Purchaser at the Closing, at no additional consideration to the Seller or the Affiliated  Trucking Companies.  The Seller and the Affiliated Companies shall promptly take all such actions and  execute all such documents as are reasonably requested by the Purchaser in connection with this Section.  (d) In connection with the performance of the Transition Services, the Seller will have no  obligation to (i) upgrade, enhance or otherwise modify any computer hardware, software or network  environment currently used or located at the Leased Real Property, (ii) provide any support or maintenance  services for any computer hardware, software or network environment that has been upgraded, enhanced  or otherwise modified from the computer hardware, software or network environment that is currently used  or located at the Leased Real Property or (iii) except as otherwise set forth herein, convert any Business  

 

{01102524.DOCX.2} 17629381v6  4 data from one format to another for use by the Purchaser or any other Person in connection with the  Transition Services or otherwise.   (e) The Seller shall instruct its employees and agents to cooperate with the Purchaser and its  agents in connection with the provision of the Transition Services.  The Seller shall instruct its employees  and agents to use their best efforts to follow all reasonable directions and instructions of the Purchaser with  respect to the Transition Services.    (f) The Purchaser hereby agrees that to the extent that the rendering of any of the Transition  Services requires the use of any Purchased Assets, the Seller shall have the use of such Purchased Assets  only as necessary to render such Transition Services.  The Purchaser shall instruct its employees and agents  to cooperate with the Seller in connection with its provision of the Transition Services hereunder.  (g) The Seller makes no representations or warranties of any kind, implied or expressed, with  respect to the quality or competence of any Leased Worker or that the services performed by the Leased  Workers will permit the Purchaser to achieve any specific or general results.    3. Fees and Expenses.   (a) As compensation to the Seller for the provision of the Transition Services to the Purchaser,  within three (3) Business Days after receiving an invoice from either the Seller or a third party engaged by  Seller for any normal operating expenses incurred in the ordinary course of the Business in the provision  of any Transition Services then being provided, the Purchaser shall pay such invoice or reimburse the Seller  for such expenses (the “Transition Fee”).  The Seller shall provide evidence of any such expenses incurred  by the Seller promptly upon reasonable request by the Purchaser.  For the avoidance of doubt, the Purchaser  shall be obligated to reimburse the Seller, or pay directly to a third party engaged by Seller, for the expenses  below to the extent that they are normal operating expenses incurred in the ordinary course of the Business:  (i) all wages, salaries and other normal and customary costs and expenses incurred by  the Seller with respect to the Leased Workers which accrue during the Transition Period, including, but not  limited to, employment-related taxes, payroll deductions and any other similar taxes, fees, contributions,  and insurance (including FICA-OASDI, FICA-HI, federal and state income taxes); and   (ii) any other reasonable amounts paid to third-party vendors to the extent incurred by  the Seller in the course of providing the Transition Services during the Transition Period.  (b) For the avoidance of doubt, the Transition Fee shall be utilized by the Seller to provide the  Transition Services.  Any expenses not related to the Transition Services, including (i) any payments due  to the landlords or other third parties from the Purchaser pursuant to the Leases, and (ii) all amounts payable  with respect to the purchase of inventory, supplies and other disposables used in the ordinary course of  business, shall be payable by the Purchaser and the Purchaser and the Seller shall mutually agree upon  whether such other amounts shall be paid directly by the Purchaser or paid by the Seller subject to  reimbursement by the Purchaser. For the avoidance of doubt, Purchaser shall not directly pay any Leased  Worker or any employee of an Affiliated Trucking Companies and such payments due from Purchaser to  Seller for such Transition Services shall be reimbursed by Purchaser to Seller in accordance with the terms  of this Agreement.  (c) If a withholding, sales, use, excise or services tax is validly assessed by any taxing authority  on the provision of any of the Transition Services under this Agreement, the Purchaser will promptly pay  directly, or promptly reimburse or indemnify the Seller for, such tax.  The parties will cooperate with each  other in determining the extent to which any tax is due and owing under the circumstances, and will provide  

 

{01102524.DOCX.2} 17629381v6  5 and make available to each other any resale certificate, information regarding out of state use of materials,  services or sale, and other exemption certificates or information reasonably requested by either party.  (d) During the Transition Period, the Seller shall promptly pay all costs and expenses incurred  in connection with the provision of the Transition Services as and when due.  (e) Notwithstanding anything contained herein to the contrary, following the Transition  Period, the Purchaser shall provide continuation coverage required under Section 4980B of the Internal  Revenue Code of 1986, as amended, and/or Part 6 of Title I of the Employee Retirement Income Security  Act of 1974, as amended, to each “M&A qualified beneficiary” (as defined in Treasury Regulation §  54.4980B-9 or any successor regulation), to the extent required by applicable law.   (f) Each of the parties hereby acknowledges that it shall have no right under this Agreement  to set off any amounts owed under this Section 3 (or to become due and owing) to the other party, whether  under this Agreement, the Asset Purchase Agreement or otherwise, against any other amount owed (or to  become due and owing) to it by the other party.  4. Post-Closing Receipts, Payments & Information.  (a) In addition to, and so long as such activities do not interfere with, the Transition Services,  during the Transition Period, the Leased Workers shall be permitted to use the same level of efforts used  prior to the Closing to (i) collect all accounts receivable of the Seller arising from the Business prior to the  Closing and (ii) pay from the Seller’s bank accounts, as and when due, all accounts payable of, and the  payroll for, the Business with respect to the pre-Closing period.  (b) The parties hereby agree and acknowledge that, notwithstanding anything herein to the  contrary, the Purchaser shall have all right, title and ownership to all Accounts Receivable of the Business  generated on or after the Closing.  During the Transition Period, the Seller shall be responsible for the  collection of all Accounts Receivable arising from the Business.  Beginning one week after the date hereof,  and continuing thereafter, the Seller shall remit to the Purchaser, pursuant to commercially reasonable  procedures that will be established by the Purchaser and agreed upon by the Seller, all (i) payments received  on Accounts Receivable attributable to the Business following the Closing and (ii) information,  correspondence, notices or other communications received or generated by the Seller related to all Accounts  Receivable, including, for the avoidance of doubt, all Accounts Receivable attributable to the Business  during the Transition Period. The obligations of the Seller pursuant to the preceding sentence shall survive  the termination of this Agreement.  (c) The parties agree that all payments from customers received by the Seller during the  Transition Period shall be applied to the invoice specified on such payment, and if no such instruction is  included on such payment, to the oldest invoice to such customer.  (d) The Seller hereby covenants and agrees that (i) the Seller shall not, and the Seller shall  cause the Affiliated Trucking Companies not to, directly or indirectly, take or omit to take any actions,  preventing, avoiding or reducing the collection of any Accounts Receivable arising from the Business on  or after the Closing, and (ii) the Seller will maintain books and records in a manner that allows the Accounts  Receivable to be accurately tracked and reported, copies of which shall be provided to the Purchaser within  two (2) Business Days of the Purchaser’s request therefor.  (e) Any information, correspondence, notices or other communications received by the  Purchaser after the Closing that concern unpaid or disputed accounts payable or other obligations of the  Business or the Seller not assumed by the Purchaser under the Asset Purchase Agreement shall be forwarded  promptly upon receipt to the Seller at the address set forth in Section 12 below.  

 

{01102524.DOCX.2} 17629381v6  6 (f) Any sums mistakenly received by either party, either during the Transition Period or  thereafter, shall be remitted to the party entitled to receive such funds within two (2) Business Days of  discovery that they were mistakenly received.  Either party mistakenly making any payment to suppliers or  vendors of the other party at any time shall be entitled to prompt reimbursement from such other party upon  written notice detailing the payment made, a copy of the information relating to the account paid and proof  of payment.  (g) During and after the Transition Period, the Seller shall inform its actual or potential  customers and suppliers that the Business has been acquired by the Purchaser and refer all inquiries of third  parties concerning the Business to the Purchaser.  5. Audits.  During the Transition Period and for a period of six (6) months thereafter, the Seller shall  permit the Purchaser and/or a third-party auditor appointed by the Purchaser to conduct an audit of the  Seller’s books and records relating to the Transition Services and the billing and collection of the Accounts  Receivable during the Transition Period under this Agreement.  All audits pursuant to this Section 5 must  be conducted: (a) upon prior written notice, (b) during the regular business hours at the location(s) where  the Seller keeps the relevant records, and (c) in a manner not to unduly interfere with the Seller’s operations.   In the event that the audit discloses any alleged underpayments of Accounts Receivable by the Seller to the  Purchaser, the Purchaser shall give notice of such discrepancies to the Seller, including a copy of the  relevant portions of the audit (“Notice of Discrepancy”).  The Seller shall have five (5) Business Days from  the date of the Notice of Discrepancy to review the alleged underpayments and give written notice (the  “Dispute Notice”) to the Purchaser if the Seller disputes any such determinations of underpayments,  describing any such disputed underpayment with specificity in the Dispute Notice.  As to any  underpayments not properly described in a timely delivered Dispute Notice, the Seller shall pay to the  Purchaser the amount thereof within two (2) Business Days after the date of the Notice of Discrepancy.  If  the Seller properly and timely disputes any underpayments, then the parties agree to use their commercially  reasonable efforts to resolve such dispute for a period of fifteen (15) days and, to the extent not then  resolved, shall thereafter refer any remaining dispute to binding arbitration pursuant to Section 12 hereof.      6. Confidentiality.    (a) “Confidential Information” means all information or materials, whether oral, written or  machine readable, tangible or intangible, relating to the business, products, services, processes, programs,  customers, suppliers, marketing methods, business, plans and/or business prospects (x) of the Purchaser or  any Affiliate thereof or (y) of the Seller or any Affiliate thereof (except that any such information or  materials included in the Purchased Assets shall not constitute Confidential Information of the Seller or any  Affiliate thereof).  “Confidential Information” does not include any information or materials that (i) is or  becomes generally available to the public other than as a result of a disclosure by a party hereto, its Affiliates  or any person acting on behalf of any such person; (ii) becomes available to a party hereto or its Affiliates  on a non-confidential basis, provided that such source was not known by such party or its Affiliates to be  bound by a confidentiality agreement with, or other contractual, legal or fiduciary obligation of  confidentiality to, such other party to this Agreement or its Affiliates with respect to such information; or  (iii) is disclosed pursuant to law, regulation or legal process or to defend a claim brought against or by the  receiving party, provided, however, such party, at the request and expense of the disclosing party, uses  reasonable efforts to limit such disclosure to the extent requested.    (b) Each party acknowledges that the Confidential Information of the other party or its  Affiliates is and shall remain the property of such other party or its Affiliates.  The parties agree with respect  to all Confidential Information that:  (i) Each party shall keep and preserve all Confidential Information of the other party  and any Affiliate thereof in confidence, and shall not disclose such Confidential Information to any  

 

{01102524.DOCX.2} 17629381v6  7 third party, other than to the party’s employees, vendors and advisors (including attorneys) who  have a need to know such information to fulfill their respective duties hereunder.  (ii) Each party shall use Confidential Information of the other party solely or any  Affiliate thereof solely in connection with the purposes of this Agreement.  Any other use of such  Confidential Information, including, but not limited to, any personal or commercial use, is  explicitly forbidden.  The parties shall not reverse engineer, decompile or otherwise manipulate  any software or other information given or disclosed to them under this Agreement except to fulfill  the purposes of this Agreement.  (iii) Upon request at any time following the Transition Period, each party shall cease  using the Confidential Information of the other party or any Affiliate thereof, and shall return or  destroy (as directed by the requesting party) all originals, copies, reproductions, extracts or  summaries, in whole or in part, of such Confidential Information, and certify to the requesting party  that such action has been taken.  (c) The Seller and the Purchaser acknowledge that a breach of any provision of this Section 6  by it or its Affiliates would cause immediate and irreparable damage to the other that would not adequately  be remedied by monetary damages, and therefore the parties agree that injunctive relief in addition to any  other legal or equitable remedies available (including, without limitation, monetary damages) is appropriate  in order to enforce this Section 6, without the necessity of posting any bond or proving irreparable harm.  (d) For avoidance of doubt, nothing herein shall be deemed to amend, limit, waive or otherwise  modify either party’s confidentiality and non-disclosure obligations set forth in the Asset Purchase  Agreement, the Confidentiality Agreement or any other agreements entered into in connection with the  Asset Purchase Agreement, including, without limitation, the Noncompetition Agreements of even date  herewith.   7. Relationship of the Parties.  Notwithstanding any other agreement the parties have entered into  (including those agreements entered into contemporaneously with this Agreement), the parties’ relationship  to each other with respect to any and all matters addressed or covered by this Agreement, including, without  limitation, the provision of the Transition Services to the Purchaser, shall for all purposes be one of  independent contractors.  Nothing in this Agreement or any other agreement between the parties shall be  interpreted as making any party the partner, joint venturor, employee or agent of the other with respect to  any and all matters addressed or covered by this Agreement.  It is agreed and understood that the parties  have no special relationship to each other (either fiduciary, confidential—except as expressly set forth  herein—or other) under this Agreement, and no party shall have any special duty or obligation to the other  except as expressly set forth in this Agreement.  Except as otherwise expressly contemplated hereby, no  party shall have the authority to assume or create any liability or obligation, express or implied, on behalf  of, or bind in any manner, any other party without such other party’s express prior written consent.  8. Limitation of Liability; Indemnity.    (a) Unless expressly and unambiguously hired and employed by the Purchaser or its Affiliates,  or as provided in Section 3(a)(i) above, all persons providing the Transition Services pursuant to this  Agreement shall be deemed solely employees or agents of the Seller or the Affiliated Trucking Companies,  and the Seller or Affiliated Trucking Company shall be solely responsible for the payment to all such  employees or contractors and payment of all contactor or employment-related taxes, payroll deductions and  any other similar taxes, fees, contributions, and insurance (including FICA-OASDI, FICA-HI, federal and  state income taxes, workers compensation insurance, unemployment insurance or other government- mandated insurance or benefits) relating to or concerning the persons providing the Transition Services  hereunder and mandated under applicable foreign, federal, state and local laws.    

 

{01102524.DOCX.2} 17629381v6  8 (b) The Purchaser hereby indemnifies the Seller and its successors and assigns, and agrees to  reimburse, defend and hold them harmless from and against any and all claims, liabilities, damages,  payments, obligations, losses, interest, penalties, costs and expenses (including reasonable attorneys’ fees),  and judgments or orders incurred or suffered by any of them that arise out of (i) any breach by the Purchaser  under this Agreement or (ii) employment of the Leased Workers during the Transition Period, including,  without limitation, those related to claims for bodily injury or wrongful death, workers compensation,  harassment, wrongful discharge, discrimination, retaliation, unfair labor practices, federal, state or local  labor law violations, ERISA violations, or any similar matter (except to the extent resulting directly from  the gross negligence or willful misconduct of the Seller).  Subject to the Seller’s compliance with its  obligations hereunder, the Seller shall not have any liability due to the refusal or inability of a Leased  Worker to provide services as Leased Worker to the Purchaser.  (c) The Seller and each Majority Shareholder, each hereby, jointly and severally, indemnify  the Purchaser and its Affiliates, successors and assigns, and agree to reimburse, defend and hold them  harmless from and against any and all claims, liabilities, damages, payments, obligations, losses, interest,  penalties, costs and expenses (including reasonable attorneys’ fees), and judgments or orders incurred or  suffered by any of them arising (i) out of any breach by the Seller under this Agreement or (ii) failure by  an Affiliated Trucking Company to provide the Transition Services as set forth in this Agreement (except  to the extent resulting directly from the gross negligence or willful misconduct of the Purchaser).  (d) The Seller and the Purchaser acknowledge and agree that nothing contained in this  Agreement is intended, shall be interpreted or construed or in any way be deemed to change, modify, alter  or otherwise affect any right to indemnification that either the Seller or the Purchaser has or may have under  the terms of the Asset Purchase Agreement.  Further, all claims for indemnification pursuant to this Section  8 will be made in accordance with the procedures set forth in Article 6 of the Asset Purchase Agreement.  9. Force Majeure.  No party shall be liable to any other party hereto for its failure or delay in  performing its obligations hereunder (other than its obligations to pay money) due to any contingency  beyond such party’s reasonable control, including, without limitation, acts of God, fires, floods, wars, acts  of war, sabotage, terrorism or national or regional emergency (a “Force Majeure Event”); provided that the  party declaring a Force Majeure Event (the “Impact Party”): (a) notifies the other party within two (2)  Business Days from the time that a Force Majeure Event begun impacting the Impacting Party’s ability to  perform under this Agreement, (b) takes all reasonable steps to mitigate the effects of the Force Majeure  Event, (c) recommences its performance under this Agreement to the extent the Force Majeure Event abates,  and (d) will not be relieved of any obligation under this Agreement to the extent the failure could have been  prevented or mitigated by business continuity and disaster recovery planning and execution standard for  the Impacted Party’s industry.   10. Successors And Assigns.  This Agreement shall be binding upon and shall inure to the benefit of  the parties and their respective permitted successors and assigns.  This Agreement shall not be assignable  (nor shall this Agreement be transferred by operation of law or otherwise) without the prior written consent  of the other party hereto, but such consent shall not be unreasonably withheld.  Notwithstanding the  foregoing, the Purchaser may assign this Agreement to any Affiliate, whether by operation of law or  otherwise, though in such event the Purchaser shall remain fully liable for all of its obligations hereunder.  11. Standard of Care.  In providing the Transition Services set forth in this Agreement, the Seller  shall, and shall cause the Affiliated Trucking Companies to, utilize the same standard of care utilized by it  in operating the Business and the Purchased Assets prior to the Closing.  12. Arbitration; Governing Law; Specific Performance.  Any dispute, controversy or claim arising  out of or relating to this Agreement or any agreement contemplated hereby shall be settled solely by the  

 

{01102524.DOCX.2} 17629381v6  9 arbitration procedure set forth in Section 10.10 of the Asset Purchase Agreement.  This Agreement shall be  governed by the law of the same state as described in the Asset Purchase Agreement. The parties agree  that irreparable damage would occur if any provision of this Agreement were not performed in accordance  with the terms hereof and that, subject to and pending the conclusion of any arbitration proceeding  commenced pursuant to Section 10.10 of the Asset Purchase Agreement, the parties shall be entitled to  specific performance of the terms hereof, in addition to any other remedy to which they are entitled at law  or in equity.  Any action or proceeding for any such remedy shall be brought in any state or federal courts  having proper jurisdiction (and any appellate court therefrom), and each party waives (a) any objection that  it may have to the venue of any such action or proceeding, and (b) any requirement for the securing or  posting of any bond in connection with any such remedy.   13. Notices.  All notices, requests, demands, claims or other communications hereunder will be in  writing and shall be deemed duly given if personally delivered, sent by facsimile, email, “pdf” (if sent by  facsimile, email, or “pdf”, such electronic delivery to be promptly followed by hardcopy via an acceptable  delivery method hereunder) or sent by a recognized overnight delivery service that guarantees next day  delivery (“Overnight Delivery”) in each case transmitted or addressed to the intended recipient as set forth  below:  If to the Seller or the  Sealand Food Inc. Majority Shareholders:  7418 Rancho Road  Richmond, VA 23228  Email:tammyl@sealandfoodsinc.com    with a copy to:  Ellenoff Grossman & Schole LLP  (which shall not  1345 Avenue of the Americas  constitute notice) New York, New York 10105 Facsimile: (212) 370-7889  Attn:  Jonathan Cramer, Matthew Gray and Sophia Song  Email: jcramer@egsllp.com, mgray@egsllp.com and  ssong@egsllp.com If to the Purchaser: HF Foods Group Inc.  19317-19319 Arenth Avenue  City of Industry, California 91748  Attention: Victor Lee  Facsimile:  (909) 718-8722  Email: victorlee@hffoodsgroup.com  with a copy to:  Sean P. Fogarty, Esq.  (which shall not  Arnall Golden Gregory LLP  constitute notice) 171 17th Street, NW, Suite 2100  Atlanta, Georgia  30363  Facsimile:  (404) 873-8151  Email: sean.fogarty@agg.com  or at such other address as any party hereto notifies the other parties hereof in writing.  The parties hereto  agree that notices or other communications that are sent in accordance herewith (i) by personal delivery,  facsimile, email or “pdf”, will be deemed received on the day sent or on the first Business Day thereafter if  

 

{01102524.DOCX.2} 17629381v6  10 not sent on a Business Day, or (ii) by Overnight Delivery, will be deemed received on the first Business  Day immediately following the date sent.  14. Miscellaneous.  (a) No course of dealing, and no failure of the Purchaser or the Seller to insist upon strict  performance of any of the terms, conditions, and covenants herein, shall be deemed a waiver of (i) any  rights or remedies that such party may have hereunder, or (ii) any subsequent breach of the terms,  conditions, and covenants herein contained.  No waiver by the Purchaser or the Seller of any rights it may  have hereunder shall be deemed to have occurred except as expressly provided in this Agreement or in a  writing signed by an authorized officer of the party to be charged.    (b) The headings contained in this Agreement are for the convenience of the parties only and  shall not affect in any way the meaning or interpretation of this Agreement unless the context clearly and  unambiguously requires otherwise.  (c) This Agreement may not be amended except by a writing signed by an authorized officer  of the party to be charged.    (d) The parties agree that all parties participated in the preparation and negotiation of this  Agreement and the agreements contemplated hereby, and that neither this Agreement nor any of the  agreements contemplated hereby shall be construed against any party by virtue of the fact that any party  prepared or drafted such agreements.    (e) This Agreement (including all agreements and other documents referenced herein)  constitutes the entire agreement among the parties with respect to the subject matter hereof and supersedes  any prior understandings or agreements, written or oral, that relate to the subject matter hereof.   (f) Unless the context of this Agreement clearly requires otherwise, (i) words of any gender  include each other gender; (ii) words using the singular or plural number also include the plural or singular  number, respectively; (iii) the terms “hereof,” “herein,” “hereby” and derivative or similar words refer to  this entire Agreement; (iv) the term “Section” refers to the specified Section of this Agreement; (v) the term  “other party” refers to the Purchaser, on the one hand, and the Seller, on the other; and (vi) the phrases  “include” and “including” shall mean “include without limitation” and “including without limitation”.    (g) Except as provided in Section 8 hereof or as otherwise expressly stated herein, nothing in  this Agreement is intended to create any rights in or benefits for any party other than the Purchaser and the  Seller and their respective Affiliates.  (h) This Agreement may be executed in several counterparts, each of which shall be an original  and all of which shall constitute one and the same Agreement.  Signature pages exchanged by fax/telecopier  or other electronic transmission shall be fully binding.  (i) This Agreement shall be interpreted in conjunction with the Asset Purchase Agreement  and any other documents and instruments referenced therein.  However, to the extent of any clear and  irresolvable conflict between the terms of this Agreement and the terms of the Asset Purchase Agreement  and any other documents and instruments referenced therein, the terms of this Agreement shall govern.    (j) The parties to this Agreement will execute and deliver, or cause to be executed and  delivered, such additional or further instruments as either party or its counsel may reasonably request for  the purpose of carrying out the transactions contemplated by this Agreement.  

 

{01102524.DOCX.2} 17629381v6  11 (Signatures on following pages)  

 

{01102524.DOCX.2}  17629381v6  IN WITNESS WHEREOF, the parties have duly executed this Agreement as of the date first above  written.  SELLER:  SEALAND FOOD, INC. By:  Name:   Its:   MAJORITY SHAREHOLDERS: Connie Wang       Jenny Wang PURCHASER:  GREAT WALL SEAFOOD VA, L.L.C. By:  Name: Kong Hian Lee a/k/a Victor Lee   Its: Sole Manager  (Signature Page to Transition Services Agreement)   

 

{01102524.DOCX.2} 17629381v6  2 Schedule 2(a)(i)(A)  Leased Workers  

 

{01102524.DOCX.2} 17629381v6  3 Schedule 2(a)(vii)  Licenses  

 

{01102524.DOCX.2} 17629381v6  4 Schedule 2(c)  Vehicles and Contracts  

 

17618573v10  Exhibit 3.1(b)  Form of Employment Agreement   (See attached)  

 

{01103021.DOCX.1}   17730289v5  FORM OF EMPLOYMENT AGREEMENT1 [EMPLOYEE’S NAME]  THIS EMPLOYMENT AGREEMENT (this “Agreement”) is made this [    ] day of [         ],  2022, by and between Great Wall Seafood VA, L.L.C., a Virginia limited liability company (the  “Company”) and an indirect subsidiary of HF Foods Group Inc., a Delaware corporation (“Parent”), and  [_____________], an individual residing in the State of [_____________] (“Employee”).  W I T N E S S E T H:  WHEREAS, pursuant to Section 3.1(b) of that certain Asset Purchase Agreement (“Purchase  Agreement”) dated as of April [   ], 2022, by and among Sealand Food, Inc., a Maryland corporation  (“Sealand Food”), the Company and certain other parties named therein, the Company is acquiring on the  date hereof the Purchased Assets, and Employee is executing this Agreement;    WHEREAS, prior to the date hereof, Employee served as [_____________] of Sealand Food;  WHEREAS, the Company desires to employ Employee and Employee desires to be employed by  the Company, all in accordance with the terms hereof; and  WHEREAS, all capitalized terms not otherwise defined herein shall have the meaning ascribed to  them in the Purchase Agreement.  NOW, THEREFORE, in consideration of the terms, conditions, and mutual covenants hereinafter  contained, and other good and valuable consideration, the receipt and sufficiency of which is hereby  acknowledged, the parties hereto do hereby agree as follows:  1. Employment.  The Company hereby employs Employee and Employee hereby accepts  employment by the Company upon the terms and conditions hereinafter stated.  2. Term.  Subject to the provisions for early termination hereinafter stated, Employee’s term  of employment hereunder shall commence on the date hereof and shall automatically continue for  successive one (1) year terms, unless (a) Employee provides at least three (3) months’ written notice of  nonrenewal to the Company prior to the end of the then current one (1) year term or (b) the Company  provides at least thirty (30) days’ written notice of nonrenewal to Employee prior to the end of the then  current one (1) year term (the initial one (1) year term, and all one (1) year renewal terms thereafter, the  “Term”).  3. Duties.  During the Term, Employee agrees to serve as, and the Company hereby  employs Employee as, [_____________] of the Company.  Initially, Employee will report to  [_____________] and thereafter to such other individual that the Company or Parent may designate from  time to time (the “Reporting Officer”).  Employee agrees to perform such duties, subject to the reasonable  direction of the Reporting Officer, as are customarily performed by [_____________] of Parent’s  operating companies, including, but not limited to, executive management and supervisory duties,  responsibilities, and authority in connection with Company operations.    4. Base Salary.  As compensation for services rendered by Employee pursuant to this  Agreement, the Company agrees to pay Employee a base salary of [______________] ($_______) per  1 Separate Employment Agreements will be provided for each of [                     ].  

 

17730289v5  {01103021.DOCX.1}  year (“Base Salary”), shall be payable in accordance with the Company’s customary payroll practices and  subject to normal withholding and payroll deductions and shall be subject to periodic review by the  Reporting Officer.  5. Other Compensation.  In addition to the compensation described in Section 4 above, the  Company shall provide to Employee such other benefits as are customarily provided to other [                ]  of Parent’s operating companies, subject to eligibility as provided in each such benefit plan or program.   By way of example, Employee shall2:  (i) be eligible to participate in employee fringe benefits (including 401(k)  plan) that may be provided by the Company to its employees in accordance with the provisions of any  such plans, as the same may be in effect from time to time;  (ii) be eligible to participate in any medical and health plans or other  employee welfare benefit plans that may be provided by the Company to its employees in accordance  with the provisions of any such plans, as the same may be in effect from time to time;  (iii) be eligible to earn vacation and paid holidays under the Company’s  vacation policy provided by the Company to its employees, as the same may be in effect from time to  time;  (iv) be entitled to sick leave, sick pay and disability benefits in accordance  with any Company policy that may be applicable to similarly situated employees of Parent’s operating  companies from time to time;   (v) be entitled to reimbursement for all necessary out-of-pocket business  expenses incurred by Employee in the performance of [his/her] duties hereunder in accordance with  Parent’s normal policies in effect from time to time; and  (vi) be eligible for discretionary bonuses in accordance with Company  practice and policy.   Employee shall not be entitled to receive any additional benefits or compensation other than as  set forth herein.  6. Termination.  (a) Employee’s employment under this Agreement may be terminated for any of the  following reasons:  (i) by the Company for Cause upon written notice of termination to Employee, which  notice shall specify Cause in reasonable detail; (ii) by the Company for any reason other than for Cause;  (iii) by Employee upon three (3) months’ written notice to the Company; or (iv) by reason of Employee’s  death or Disability. (b) In the event of a termination of Employee’s employment by the Company for  Cause or by Employee upon three (3) months’ written notice, all obligations of the Company and Parent  under Sections 4 and 5 of this Agreement shall terminate except that the Company shall pay Employee (to  the extent not previously paid) [his/her] Base Salary, accrued but unused vacation, and reimbursable  business expenses incurred prior to such termination.       2 Note to Sellers: Benefits subject to confirmation by Company.  

 

17730289v5  {01103021.DOCX.1}  (c) In the event of a termination of Employee’s employment by the Company  without Cause or the nonrenewal of this Agreement by the Company pursuant to Section 2(b) above, all  obligations of the Company and Parent under Sections 4 and 5 of this Agreement shall terminate except  that: (i) the Company shall pay Employee (to the extent not previously paid) [his/her] Base Salary,  accrued but unused vacation, and reimbursable business expenses incurred prior to such termination; (ii)  the Company shall pay Employee an amount equal to [his/her] Base Salary for the lesser of (A) six (6)  months after termination or (B) the number of months remaining in the Term as of the effective date of  such termination; and (iii) the Company shall pay shall pay the premium associated with continuation of  group health, dental, and vision benefits for Employee and [his/her] covered dependents under COBRA  in accordance with the benefit programs provided to Employee until the earliest to occur of (A) the date  six (6) months after termination,  (B) the end of the Term or (C) the date Employee is eligible to enroll in  the health, dental and/or vision plans of another employer, provided that Employee and Employee’s  eligible dependents, if any, are participating in the Company’s group health, dental and vision plans at the  time of Employee’s termination and elect on a timely basis to continue that participation in some or all of  the offered plans under COBRA.  Employee agrees to notify the Company promptly if Employee is  eligible to enroll in the plans of another employer or if Employee or any of Employee’s dependents cease  to be eligible to continue to participate in the Company’s benefit plans through COBRA.  Payment of  amounts under subparagraphs (ii) and (iii) herein are contingent upon Employee’s execution and delivery  of an effective general release of the Company and its Affiliates, officers, directors and employees, in  form and substance acceptable to the Company in its reasonable discretion (the “General Release”) and  will be subject to federal and state payroll deductions and payable on the next regular pay date after such  execution and delivery of the General Release.  In the event of termination of Employee’s employment by  the Company without Cause, Employee shall not be entitled to duplicative benefits and or payments  pursuant to any other contract, severance plan or policy.  (d) In the event of termination of Employee’s employment due to death or Disability,  all obligations of the Company and Parent under Sections 4 and 5 of this Agreement shall terminate  except with respect to payment of Base Salary accruing prior to such death or Disability and, in the case  of Disability, payment of such disability benefits as Employee is entitled to receive in accordance with the  applicable disability plan or program.  7. Definitions.  For the purposes of this Agreement only, the following definitions shall  apply:  (a) “Cause” means termination of Employee’s employment for Cause upon written  notice of termination to Employee, which notice shall specify Cause in reasonable detail.  As used herein,  “Cause” shall mean:  (i) Employee’s repeated failure to substantially perform [his/her] duties hereunder,  including but not limited to poor performance as determined in the Company’s discretion, after written  demand for performance has been given by the Company that identifies how Employee has not performed  [his/her] duties and such failure, if susceptible of cure, has not been cured for a period of 30 days after  Employee receives notice from the Company; (ii) Employee’s act(s) or omission(s) amounting to  negligence in the performance of [his/her] duties hereunder to the detriment of the Company, which act  or omission has not been cured (if susceptible to cure) for a period of 30 days after Employee receives  notice from the Company; (iii) Employee’s willful or grossly negligent failure or refusal to perform any  material obligation under this Agreement or to carry out the reasonable directives of the Reporting  Officer; (iv) Employee’s commission of fraud, theft or embezzlement against the Company or its  suppliers or customers (as determined in good faith and following a reasonable investigation by the  Company); (v) Employee’s conviction of or pleading guilty or no lo contendere to any felony under  applicable law; (vi) Employee’s failure to observe or perform any covenant, condition or provision of  Sections 8 through 11 of this Agreement; or (vii) Employee’s breach of the standalone Noncompetition  

 

17730289v5  {01103021.DOCX.1}  and Nonsolicitation Agreement, by and among Employee, the Company and the other parties thereto  (“Noncompetition Agreement”) 3.  (b) “Company Business” means the business of marketing, distributing and/or selling  and other restaurant products to restaurants, markets and other customers throughout the United States in  the Territory as conducted by the Company as of the date hereof. (c) “Competing Business” means any Person that is engaged in or conducts a  business that is substantially similar to or the same as the Company Business, and only that portion of the  business that is in competition with the Company Business. (d) “Confidential Information” means information (other than information that is a  Trade Secret) of the Company, Parent or any of their Affiliates that is not generally known or available to  the public and which the Company, Parent or any of their Affiliates desires to keep confidential. (e) “Disability” means the inability of Employee to perform those duties and  responsibilities which are the essential functions of Employee’s position due to illness, accident or any  other physical or mental incapacity.  (f) “Territory” means the United States.  The parties hereto agree that the Territory  represents the geographical locations in which Employee has responsibilities hereunder.  The parties  hereto agree that the Company serves customers throughout the Territory and Employee’s duties and  responsibilities hereunder will similarly extend throughout the Territory.  (g) “Trade Secrets” shall mean information not generally known about the Company  Business, the Company, Parent or any of their Affiliates that (i) is the subject of efforts that are reasonable  under the circumstances to maintain its secrecy or confidentiality and from which the Company, Parent or  any of their Affiliates derives economic value from the fact that the information is not generally known to  other persons who can obtain economic value from its disclosure or use or (ii) is treated as a trade secret  under applicable law.  Trade Secrets include, but are not limited to, technical or non-technical data,  compilations, programs and methods, techniques, drawings, processes, financial data, research, pricing,  information as to sales representatives and suppliers, lists of actual customers and potential customers,  customer route books, cards or lists containing the names, addresses, buying habits and business locations  of past, present and prospective customers, sales reports, service reports, price lists, product formulae and  methods and procedures relating to services in each case to the extent not known or available to the  public, persons who can obtain economic value from its disclosure or use, or competitors in the trade.  8. Non-Disclosure.  (a) The parties agree that operation of the Company Business encompasses  substantially all of the Territory and that the Company Business enjoys a valuable and extensive trade of  its products and services.  By virtue of Employee’s employment with the Company and specialized  training that has been and will be provided to Employee in connection therewith, Employee has been and  will be entrusted with the knowledge and possession of Trade Secrets and Confidential Information.  The  Company and Employee agree that such Trade Secrets and Confidential Information better enable the  Company to compete in its industry, and by virtue of Employee’s knowledge of the Company Business,  the Company may suffer material loss and irreparable injury if Employee were to disclose or use Trade  Secrets or Confidential Information in contravention of Section 8(b) hereof.  3 The reference to the Non-Competition Agreement to be included in the Employment Agreement for all Key  Employees other than [                 ].  

 

17730289v5  {01103021.DOCX.1}  (b) Employee will not at any time, both during and, subject to the next following  paragraph, after the expiration or termination of the Term, communicate or disclose to any Person, or use  for [his/her] benefit or for the benefit of any Person other than the Company, Parent or any of their  Affiliates, directly or indirectly, any Trade Secrets and/or Confidential Information acquired by Employee  while employed by the Company; provided, however, that Employee may disclose such information (i)  that is generally known or available to the public (other than by virtue of any disclosure in violation of  this Agreement by Employee), (ii) required to enforce rights of Employee under this Agreement or any  agreement entered into in connection herewith, (iii) as is necessary to disclose in the performance of  [his/her] duties hereunder, (iv) as may be required in any report, statement or testimony submitted to any  municipal, state, federal or other governmental regulatory body, (v) as may be required in response to any  summons or subpoena or in connection with any litigation, or administrative, or other legal proceeding, or  (vi) as may be required in order to comply with any law, order, regulation or ruling applicable to  Employee or the Company; and provided further that Employee shall give the Company reasonable prior  notice of any disclosure under the immediately preceding clauses (iv), (v) and (vi) in order to permit the  Company and/or its Affiliates reasonable opportunity to seek an appropriate protective order.  (c) For the purposes of this Agreement, the prohibition against the disclosure of  Confidential Information shall end twelve (12) months after the date on which Employee ceases to be  employed by the Company for any reason, regardless of the earlier expiration or termination of this  Agreement, and the prohibition on the disclosure of Trade Secrets by Employee shall continue until such  information loses its character as a Trade Secret through no fault or action of Employee.  9. Agreement Not to Compete.  Employee covenants and agrees that during [his/her] employment with the Company and for twelve (12) months after the date on which Employee ceases to be  employed by the Company for any reason, regardless of the earlier expiration or termination of this  Agreement, [he/she] will not, directly or indirectly, engage in any Competing Business that is located  within the Territory and wherein Employee will perform duties which are the same or substantially  similar to those that Employee performed for the Company during the last twelve (12) months of  Employee’s employment with the Company.  Employee acknowledges that the Territory represents the  geographical location throughout which the Company, and Employee on behalf of the Company, services  customers and operates the Company Business.   10. Agreement Not to Solicit Customers.  Employee covenants and agrees that during  [his/her] employment with the Company and for twenty-four (24) months after the date on which  Employee ceases to be employed by the Company for any reason, regardless of the earlier expiration or  termination of this Agreement, [he/she] will not, without the prior written consent of the Reporting  Officer, the Company or Parent, directly or indirectly, on [his/her] own behalf or in the service or on  behalf of others, solicit or otherwise attempt to divert or appropriate to a Competing Business any  customer of the Company, Parent or any of their Affiliates to whom the Company, Parent or any of their  Affiliates sold or provided any products or services in connection with the Company Business within the  Territory during the last twelve (12) months of Employee’s employment with the Company and with  whom Employee had direct or indirect contact.  11. Agreement Not to Solicit Employees.  Employee covenants and agrees that during  [his/her] employment with the Company and for twelve (12) months after the date on which Employee  ceases to be employed by the Company for any reason, regardless of the earlier expiration or termination  of this Agreement, [he/she] will not, directly or indirectly, on [his/her]  own behalf or in the service or on  behalf of others, solicit, divert or recruit any employee of the Company, Parent or any of their Affiliates  to leave such employment, whether or not such employment is pursuant to a written contract or at will.  

 

17730289v5  {01103021.DOCX.1}  12. Injunctive Relief.  Both Employee and the Company expressly recognize that the subject  matter of Sections 8 through 11 of this Agreement is unique, and that any breach of Employee’s  obligations under such Sections may result in irreparable injury and harm to the Company which cannot  be adequately or solely measured or compensated by the rules of law and legal remedies.  Therefore, in  the event of a breach or threatened breach of such Sections by Employee, the Company, Parent and/or  their Affiliates shall be entitled to obtain specific performance of such Sections through injunctive relief  and such ancillary remedies of an equitable nature as a court may deem appropriate without being  required to post any bond or prove “irreparable harm”.  Such equitable relief shall be in addition to, and  the availability of such equitable relief shall not serve to preclude, any legal remedies that might be  available to the Company, Parent or their Affiliates.  13. Governing Law.  This Agreement is governed by and subject to the laws of the State of  Delaware (without giving effect to its conflict of law provisions) irrespective of the fact that a party  hereto may be a resident of another state or jurisdiction.    14. Non-Waiver.  The failure to enforce any right arising under this Agreement or any other  agreement on one or more occasions shall not operate as a waiver of that right under this Agreement or  any other agreement on any other occasion, or of any other right on that occasion or any other occasion.  15. Severability.  If any portion of this Agreement may be held to be invalid or unenforceable  for any reason, it is agreed that said invalidity or unenforceability shall not affect the other portions of this  Agreement and that the remaining covenants, terms and conditions or portions thereof shall remain in full  force and effect, and any court of competent jurisdiction may so modify or amend the objectionable  provision as to make it valid, reasonable and enforceable.  If any court shall finally hold that the time,  scope or territory or any other provision stated in this Agreement constitutes an unreasonable restriction  upon Employee, Employee hereby expressly agrees that the provisions of this Agreement shall not be  rendered void, but shall apply as to time and territory or to such other extent as such court may judicially  determine or indicate constitutes a reasonable restriction under the circumstances involved.  16. Notices.  All notices, requests, demands, claims or other communications hereunder will  be in writing and shall be deemed duly given if personally delivered, sent by telefax, “pdf” or sent by a  recognized overnight delivery service which guarantees next day delivery (“Overnight Delivery”), or  mailed registered or certified mail, return receipt requested, postage prepaid, transmitted or addressed to  the intended recipient as set forth below: in the case of the  Company to:  HF Foods Group Inc.  19317-19319 Arenth Avenue  City of Industry, California 91748  Attention: Victor Lee  Facsimile: (909) 718-8722  Email: victorlee@hffoodsgroup.com  with a copy to:  (which shall not   constitute notice)  Arnall Golden Gregory LLP  171 17th Street, NW, Suite 2100  Atlanta, Georgia  30363  Attention: Sean P. Fogarty, Esq.  Facsimile:  (404) 873-8151  Email: sean.fogarty@agg.com  and in the case of Employee to: [Employee]  _______________________  

 

17730289v5  {01103021.DOCX.1}  _______________________  Facsimile: ______________  Email: ___________________  or at such other addresses as any party hereto notifies the other parties hereof in writing in accordance  with this Section.  The parties hereto agree that notices or other communications that are sent in  accordance herewith (i) by personal delivery, facsimile, email or “pdf” will be deemed received on the  day sent or on the first business day thereafter if not sent on a business day, (ii) by Overnight Delivery,  will be deemed received on the first business day immediately following the date sent, and (iii) by U.S.  mail, will be deemed received three (3) business days immediately following the date sent.  For purposes  of this Agreement, a “business day” is a day on which the Company is open for business and shall not  include a Saturday, Sunday or legal holiday.    17. Benefit.  This Agreement shall be binding upon and inure to the benefit of and shall be  enforceable by the Company and its respective successors and assigns, and Employee, [his/her] heirs,  executors and personal representatives, but shall not be assignable by Employee.  This Agreement shall  also inure to the benefit of and shall be enforceable by Parent.  The Agreement shall be freely assignable  by the Company.   18. Modification.  This Agreement contains the entire agreement of the parties with respect  to the subject matter hereof and may be amended or superseded only by an agreement in writing signed  by the parties hereto.  No action or course of conduct shall constitute a waiver of any of the terms and  conditions hereof, unless such waiver is specified in writing and, in the case of such action by the  Company, approved by the Reporting Officer in writing, and then only to the extent so specified.  19. Headings.  The headings in this Agreement are intended solely for convenience of  reference and shall be given no effect in the construction or interpretation of this Agreement.  20. Litigation Assistance.  Employee agrees that following the termination of [his/her] employment hereunder, regardless of the reason for or manner of such termination, other than death or  Disability that prevents [his/her] cooperation, [he/she] shall, upon reasonable notice and scheduling,  furnish such information and give such assistance to the Company in any controversy or matter involving  litigation as may reasonably be requested by the Company.  The Company shall compensate Employee  for all reasonable out-of-pocket expenses incurred while so assisting the Company. Employee is not  obligated to assist in any controversy or litigation between the Company and Employee, nor is Employee  required to provide anything other than truthful testimony. In the event Employee is required to devote  more than eight (8) hours of time, including travel time, to assisting the Company, the Company shall  compensate Employee at the rate of $40.00 per hour for all hours worked over eight (8) hours, in addition  to all reasonable out-of-pocket expenses incurred while so assisting the Company.  21. Interpretation.  Should any provision of this Agreement require a judicial interpretation, it  is agreed that the judicial body interpreting or construing this Agreement shall not apply the assumption  that the terms of this Agreement shall be more strictly construed against one party by reason of the rule of  legal construction that an instrument is to be construed more strictly against the party which itself or  through its agents prepared the agreement.  The parties acknowledge and agree that they and their agents  have each had the opportunity to participate equally in the negotiations and preparation of this  Agreement, and Employee acknowledges that [he/she] has had the opportunity to consult legal counsel  regarding the terms hereof.  22. No Limitation.  Nothing contained in this Agreement (including any termination of  Employee’s employment with the Company, regardless of the reason) shall in any way supersede,  

 

17730289v5  {01103021.DOCX.1}  modify, replace, amend, change, rescind, waive, defeat, limit, impair, expand, exceed, enlarge or affect  the provisions set forth in, or any party’s rights, remedies or obligations under, the Purchase Agreement  and other Transaction Documents referred to therein, this Agreement being intended solely to  memorialize the terms of Employee’s employment with the Company. 23. Expenses of Enforcement.  The non-prevailing party shall be liable to, and will pay the  prevailing party for all costs and expenses, including, but not limited to, reasonable attorneys’ fees  incurred by the prevailing party in the enforcement, defense or interpretation in any respect of any of its  rights under this Agreement, whether in litigation or otherwise.  24. Counterparts.  This Agreement may be executed in one or more counterparts, each of  which shall be deemed an original, but all of which together shall constitute one and the same instrument,  with the same effect as if the signatures thereto were in the same instrument.  Signature pages exchanged  by facsimile, “pdf” or other electronic means shall be fully binding.  This Agreement shall be effective  and binding on all parties when all parties have executed and delivered a counterpart of this Agreement.  25. Survival.  Sections 7 through 25 hereof shall survive the termination of this Agreement.   [Signatures on following page]  

 

17730289v5  {01103021.DOCX.1}  IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first  above written.  COMPANY:  GREAT WALL SEAFOOD VA, L.L.C. By:   Name: Kong Hian Lee a/k/a Victor Lee   Its: Sole Manager  EMPLOYEE:  [NAME]  [Signature Page to Employment Agreement] 

 

17618573v10  Exhibit 3.8(a)  Form of Seller Noncompetition Agreement   (See attached)  

 

17730803v4  SELLER NONCOMPETITION AND NONSOLICITATION AGREEMENT  THIS NONCOMPETITION AND NONSOLICITATION AGREEMENT (this “Agreement”),  dated this ____ day of __________ 2022, is made by and between Great Wall Seafood VA, L.L.C., a  Virginia limited liability company (the “Purchaser”), an indirect subsidiary of HF Foods Group Inc., a  Delaware corporation (“Parent”), and Sealand Food, Inc., a Maryland corporation (the “Seller”).  W I T N E S S E T H:  WHEREAS, the Seller markets, distributes and sells seafood products and other restaurant products  and related items to restaurants, markets and other customers (the “Business”) throughout the continental  United States (the “Territory”);   WHEREAS, pursuant to that certain Asset Purchase Agreement, dated as of April _____, 2022 (the  “Purchase Agreement”), among the Seller, the Majority Shareholders, the Purchaser, and certain other  parties named therein, the Purchaser is acquiring on the date hereof the Purchased Assets (the  “Acquisition”);  WHEREAS, pursuant to Sections 3.8 and 7.1(e) of the Purchase Agreement, the Seller is executing  this Agreement as a condition to the Purchaser consummating the Acquisition;   WHEREAS, this Agreement is ancillary to and an integral part of the Purchase Agreement and the  transactions contemplated therein; and  WHEREAS, all capitalized terms not otherwise defined herein shall have the meaning ascribed to  them in the Purchase Agreement.  NOW, THEREFORE, in consideration of the execution, delivery and performance of the Purchase  Agreement, the mutual covenants and agreements of the parties herein contained and other good and  valuable consideration, the receipt and sufficiency of which are hereby acknowledged and confessed, the  parties agree as follows:  1.   Recitals.  The foregoing recitals are hereby incorporated into this Agreement for all  purposes.    2. Definitions.  For the purposes of this Agreement, the following definitions shall apply:  (a) “Competing Business” means that portion of any business which is (i) substantially  similar to and (ii) in competition with the Business of the Seller.  (b) “Confidential Information” means any confidential, proprietary, or secret  information, documentation, or material (other than information that is a Trade Secret) of the Business, the  Seller, the Purchaser, the Parent or any of their respective Affiliates that is not generally known or available  to the public or competitors in the trade.  (c) “Noncompetition Period” means three (3) years from and after the date hereof.  (d) “Trade Secrets” means information not generally known about the Business or the  Seller, the Purchaser, the Parent or any of their respective Affiliates that (i) is the subject of efforts that are  reasonable under the circumstances to maintain its secrecy or confidentiality and from which the Seller, the  Purchaser, the Parent or any of their respective Affiliates derives or may derive economic value from the  fact that the information is not generally known to other Persons who can obtain economic value from its  

 

17730803v4  disclosure or use or (ii) is treated as a trade secret under applicable law.  Trade Secrets include, but are not  limited to, technical or non-technical data, compilations, programs and methods, techniques, drawings,  processes, financial data, research, pricing, information as to sales representatives and suppliers, lists of or  information regarding actual customers or potential customers, customer route books, cards or lists  containing the names, addresses, buying habits or business locations of past, present or prospective  customers, sales reports, service reports, price lists, product formulae or methods and procedures relating  to services.  3. Covenants of the Seller.  The covenants in this Section 3 are a material inducement to the  Purchaser to consummate the Acquisition, and the amounts payable to the Seller under the Purchase  Agreement are in partial consideration for the covenants in this Section 3. The parties acknowledge and  agree that the covenants contained herein are designed to protect the legitimate business interests of the  Purchaser, the Parent and their respective Affiliates in the assets being acquired, particularly the Trade  Secrets, Confidential Information, substantial customer relationships, goodwill and specialized training of  the Seller as developed over time and at substantial expense.  The parties moreover acknowledge and agree  that the covenants contained herein are being made because the business connections, customers, products,  techniques, goodwill and other aspects of the Business are maintained at great expense, are long standing,  are of great value to the Purchaser, the Parent and their respective Affiliates and provide them with a  substantial competitive advantage. The parties also acknowledge and agree that (i) the types and periods of  restriction imposed in this Section 3 are fair and reasonable and are designed in order to protect and maintain  the Trade Secrets, Confidential Information and the other proprietary interests of the Seller, the Purchaser,  the Parent and their respective Affiliates, other legitimate business interests of the Purchaser, the Parent and  their respective Affiliates, and goodwill associated with the Business, and (ii) the time, scope, geographic  area, and other provisions of this Section 3 have been specifically negotiated by the parties, represented by  legal counsel, and are integral parts of the transactions contemplated by the Purchase Agreement.  (a) Nondisclosure of Trade Secrets and Confidential Information.  (i) The parties agree that operation of the Business encompasses substantially  all of the Territory and that the Business enjoys a valuable and extensive trade of its products and services.   The Seller and its employees have been and may continue to be entrusted with the knowledge and  possession of Trade Secrets and Confidential Information.  The parties agree that by virtue of the Seller’s  and its employees’ knowledge of the Business, the Purchaser, the Parent and their respective Affiliates may  suffer material loss and irreparable injury if the Seller were to disclose or use Trade Secrets or Confidential  Information in contravention of this Agreement.  (ii) The Seller shall (and shall cause each of its Affiliates to) keep strictly  confidential and shall not (and shall cause each of its Affiliates not to), directly or indirectly, at any time  communicate or disclose to any Person other than the Purchaser or the Parent or their respective Affiliates,  or use for its benefit or for the benefit of any Person other than the Purchaser or the Parent or their respective  Affiliates, any Trade Secrets or Confidential Information; provided, however, that the Seller may disclose  such information (A) that is generally known to the public or known by or available to competitors in the  trade (other than by virtue of any disclosure by the Seller or its employees in violation of this Agreement  or any other shareholder or former shareholder of the Seller in violation of such Person’s Noncompetition  and Nonsolicitation Agreement), (B) as may be required to enforce rights of the Seller under the Purchase  Agreement or any agreement entered into in connection therewith, (C) as may be required in response to  any summons or subpoena or in connection with any litigation, or any administrative or other legal  proceeding, or (D) as may be required in order to comply with any law, order, regulation or ruling applicable  to the Seller or the Purchaser; and provided further that the Seller shall give the Purchaser reasonable prior  notice of any disclosure under the immediately preceding clauses (B), (C) or (D) in order to permit the  Purchaser, the Parent or their respective Affiliates reasonable opportunity to seek an appropriate protective  order.  

 

17730803v4  (iii) For the purposes of this Agreement, the obligations of the Seller relating  to Confidential Information only shall end at the expiration of the Noncompetition Period, and the  obligations of the Seller relating to Trade Secrets shall end upon the later of (x) the date on which such  information loses its character as a Trade Secret through no fault or action of the Seller (or any other current  or former employee or shareholder of the Seller) or (y) the expiration of the Noncompetition Period.  (iv) The Seller agrees not to (and shall cause each of its Affiliates not to),  directly or indirectly, during the Non-Competition Period, publish or communicate (including, without  limitation, in any public forum) any defamatory or disparaging remarks, comments or statements  concerning the Business or the Purchaser, the Parent or their Affiliates or any employees, officers, directors,  personnel, customers or suppliers of any of the foregoing.    (b) Noncompetition.  The Seller covenants and agrees that the Seller shall not (and  shall cause each of its Affiliates not to), during the Noncompetition Period, either directly or indirectly,  within the Territory (i) provide or perform services for the benefit of, manage, operate, or in any way  participate in, a Competing Business, either on its own behalf or on behalf of any other Person, and  regardless of whether in the capacity of an agent, consultant or independent contractor, paid or otherwise,  or (ii) have a financial interest in, own or control any Competing Business, whether as a shareholder, owner,  partner, proprietor, lender or otherwise; provided, however, that the Seller and its Affiliates may own, as a  passive investment, equity interests of a Competing Business if (A) such equity interests are listed on a  national securities exchange or traded on a national market system in the United States, and (B) the Seller  and its Affiliates, owns beneficially and in the aggregate (directly or indirectly) less than five percent (5%)  of the total issued and outstanding equity interests of such Competing Business. The Seller acknowledges  that during the twelve (12) month period immediately prior to the Acquisition, the Business serviced  customers within the Territory.   (c) Nonsolicitation of Customers and Suppliers.  The Seller covenants and agrees that  the Seller shall not (and shall cause each of its Affiliates not to), during the Noncompetition Period, either  directly or indirectly, in the service or on behalf of a Competing Business, (i) attempt to divert (A) the sales  of any customer to which the Seller or, to the extent such sales were attributable to the Business, any  Affiliate of the Seller sold or provided any products or services, or (B) the services of any supplier, vendor  or service provider from which the Seller received any products or services, in either case, at any time  within the twenty-four (24) month period prior to the Closing Date, or (ii) except with respect to the  operation of a Permitted Business, solicit (A) the sales of any customer to which the Seller or, to the extent  such sales were attributable to the Business, any Affiliate of the Seller sold or provided any products or  services, or (B) the services of any supplier, vendor or service provider from which the Seller received any  products or services, in either case, at any time within the twenty-four (24) month period prior to the Closing  Date; provided, that in no instance shall any action permitted in this Section 3(c)(ii) violate the terms of  Section 3(c)(i).   (d) Nonsolicitation of Employees.  The Seller covenants and agrees that the Seller  shall not (and shall cause each of its Affiliates not to), during the Noncompetition Period, either directly or  indirectly, hire, solicit, divert or recruit any Person employed by the Seller, the Purchaser, the Parent or any  of their respective Affiliates within six (6) months prior to such hire, solicitation, diversion or recruitment  to (in the case of solicitation, diversion or recruitment) leave such employment, whether or not such  employment is pursuant to a written contract or at will, to join a Competing Business; provided that the  parties understand that the Seller shall continue to employ the Current Employees after the Closing subject  to the terms of the Transition Services Agreement.  4. Severability.  The terms of this Agreement will, where possible, be interpreted and  enforced so as to sustain their legality and enforceability, read as if they cover only the specific situation to  which they are being applied and enforced to the fullest extent permissible under applicable law. If any  

 

17730803v4  term of this Agreement is determined by a court of competent jurisdiction to be invalid, illegal or incapable  of being enforced, then all other terms of this Agreement will nevertheless remain in full force and effect,  and such term automatically will be amended so that it is valid, legal and enforceable to the maximum  extent permitted by applicable law, but as close to the parties’ original intent as is permissible.  5. Remedies.  (a) Injunctive Relief.  The parties expressly recognize that the subject matter of this  Agreement is unique, and that any breach of the Seller’s obligations under this Agreement may result in  irreparable injury to the Purchaser, the Parent and their respective Affiliates that cannot be adequately or  solely measured or compensated by the rules of law and legal remedies.  Therefore, in the event of a breach  of this Agreement by the Seller, the Purchaser and the Parent shall be entitled to obtain specific performance  of this Agreement through injunctive relief and such ancillary remedies of an equitable nature as a court  may deem appropriate, without the necessity of proving “irreparable harm” or securing or posting any bond.   Such equitable relief shall be in addition to, and the availability of such equitable relief shall not serve to  preclude, any legal remedies that might be available to the Purchaser, the Parent or any of their respective  Affiliates.   (b) Tolling of Covenants upon Breach.  In addition to any other form of equitable or  legal relief, in the event that the Seller breaches any of the covenants set forth in Section 3 above, then the  Noncompetition Period shall be tolled and automatically extended for the period of the breach so that the  benefit of the bargain negotiated by the Purchaser may be preserved.     6. Governing Law; Dispute Resolution.  This Agreement is governed by and subject to the  laws of the State of Delaware (without giving effect to its conflict of law provisions) irrespective of the fact  that a party hereto may be a resident of another state or jurisdiction.  Notwithstanding any provision of this  Agreement to the contrary, with the exception of disputes, controversies or claims where the sole remedy  sought is injunctive relief, all disputes, controversies or claims arising out of or relating to this Agreement  shall be resolved in accordance with Section 10.10 of the Purchase Agreement.      7. Modification.  This Agreement (including the Exhibits attached hereto), together with the  Purchase Agreement, contains the entire agreement of the parties with respect to the subject matter hereof,  and this Agreement may be amended or superseded only by an agreement in writing signed by the parties  hereto.  No action or course of conduct shall constitute a waiver of any of the terms and conditions hereof,  unless such waiver is specified in writing, and then only to the extent so specified.  8. Benefit; Assignment.  This Agreement shall be binding upon and inure to the benefit of  and shall be enforceable by the parties and their respective successors and permitted assigns and, in addition,  shall inure to the benefit of and shall be enforceable by the Parent.  This Agreement shall not be assignable  by the Seller, but may be assigned in whole or in part by the Purchaser and any successor to, or assignee  of, the Purchaser may enforce the provisions of this Agreement.  9. Headings; Interpretation.  The headings in this Agreement are intended solely for  convenience of reference and shall be given no effect in the construction or interpretation of this Agreement.  Should any provision of this Agreement require a judicial interpretation, it is agreed that the judicial body  interpreting or construing this Agreement shall not apply the assumption that the terms of this Agreement  shall be more strictly construed against one party by reason of the rule of legal construction that an  instrument is to be construed more strictly against the party which itself or through its agents prepared the  agreement.  The parties acknowledge and agree that they and their agents have each had the opportunity to  participate equally in the negotiations and preparation of this Agreement, and to consult legal counsel  regarding the terms hereof.  

 

17730803v4  10. Notices.  All notices, requests, demands, claims or other communications hereunder will  be in writing and shall be deemed duly given if personally delivered, sent by facsimile, email, “pdf” (if sent  by facsimile, email, or “pdf”, such electronic delivery to be promptly followed by hardcopy via an  acceptable delivery method hereunder) or sent by a recognized overnight delivery service that guarantees  next day delivery (“Overnight Delivery”) or mailed registered or certified mail, return receipt requested,  postage prepaid, in each case transmitted or addressed to the intended recipient as set forth below:  If to the Seller:  Sealand Food, Inc.  [                       ]  [                       ]  [                       ]  [                       ]  [                       ]  [                       ]  with a copy to:  Ellenoff Grossman & Schole LLP  (which shall not  1345 Avenue of the Americas  constitute notice) New York, New York 10105  Facsimile: (212) 370-7889  Attn:  Matthew Gray, Jonathan Cramer and Sophia Song  Email: mgray@egsllp.com; jcramer@egsllp.com and  ssong@egsllp.com  If to the Purchaser: HF Foods Group Inc.  19317-19319 Arenth Avenue  City of Industry, California 91748  Facsimile:  (909) 718-8722  Attn: Victor Lee  Email: victorlee@hffoodsgroup.com  with a copy to:  Sean P. Fogarty, Esq.  (which shall not  Arnall Golden Gregory LLP  constitute notice) 171 17th Street, NW, Suite 2100  Atlanta, Georgia  30363  Facsimile:  (404) 873-8151  Email: sean.fogarty@agg.com  or at such other address as any party hereto notifies the other parties hereof in writing.  The parties  hereto agree that notices or other communications that are sent in accordance herewith (a) by personal  delivery, facsimile, email or “pdf”, will be deemed received on the day sent or on the first business day  thereafter if not sent on a business day, (b) by Overnight Delivery, will be deemed received on the first  business day immediately following the date sent, and (c) by U.S. mail, will be deemed received three (3)  business days immediately following the date sent. For purposes of this Agreement, a “business day” is a  day on which the Purchaser is open for business and shall not include a Saturday or Sunday or legal holiday.  11. Expenses of Enforcement. The non-prevailing party shall be liable to, and will reimburse,  the prevailing party for all costs and expenses, including, but not limited to, reasonable attorneys’ fees,  court costs and other expenses of litigation or arbitration, incurred by the prevailing party in the  enforcement, defense or interpretation in any respect of any of its rights under this Agreement, whether in  litigation or otherwise.      

 

17730803v4  12. Counterparts.  This Agreement may be executed in one or more counterparts, each of which  shall be deemed an original, but all of which together shall constitute one and the same instrument, with the  same effect as if the signatures thereto were in the same instrument.  This Agreement shall be effective and  binding on all parties when all parties have executed and delivered a counterpart of this Agreement.  Signature pages exchanged by facsimile, “pdf” or other electronic means shall be fully binding. (Signatures on the Following Pages) 

 

{01051146.DOCX.3}   17730803v4  IN WITNESS WHEREOF, the parties hereto, intending to be legally bound, have executed and  delivered this Agreement as of the day and year first above written.        PURCHASER: Great Wall Seafood VA, L.L.C.  By:   Name: Kong Hian Lee a/k/a Victor Lee   Its: Sole Manager   (Signature Page to Seller Noncompetition Agreement) 

 

{01051146.DOCX.3}   17730803v4  SELLER:  Sealand Food, Inc.  By:    Name:   Its: (Signature Page to Seller Noncompetition Agreement)  

 

17618573v10  Exhibit 3.8(b)  Form of Shareholder Noncompetition Agreement   (See attached)  

 

17730925v4  SHAREHOLDER NONCOMPETITION AND NONSOLICITATION AGREEMENT  THIS NONCOMPETITION AND NONSOLICITATION AGREEMENT (this  “Agreement”), dated this ____ day of ________ 2022, is made by and between Great Wall Seafood VA,  L.L.C., a Virginia limited liability company (“the Purchaser”), an indirect subsidiary of HF Foods Group  Inc., a Delaware corporation (“Parent”), and (ii) [                   ] (the “Shareholder”).  W I T N E S S E T H:  WHEREAS, the Shareholder owns shares of stock in Sealand Food, Inc., a Maryland corporation  (the “Company”).  WHEREAS, the Company markets, distributes and sells seafood products and other restaurant  products and related items to restaurants, markets and other customers (the “Business”) throughout the  continental United States (the “Territory”);  WHEREAS, pursuant to that certain Asset Purchase Agreement, dated as of April _____, 2022  (the “Purchase Agreement”), among the Company, the Shareholder, the Purchaser, Parent, and certain  other parties named therein, the Purchaser is acquiring on the date hereof the Purchased Assets (the  “Acquisition”);  WHEREAS, pursuant to Sections 3.8 and 7.1(e) of the Purchase Agreement, the Shareholder is  executing this Agreement as a condition to the Purchaser consummating the Acquisition;   WHEREAS, this Agreement is ancillary to and an integral part of the Purchase Agreement and  the transactions contemplated therein; and  WHEREAS, all capitalized terms not otherwise defined herein shall have the meaning ascribed to  them in the Purchase Agreement.  NOW, THEREFORE, in consideration of the execution, delivery and performance of the  Purchase Agreement, the mutual covenants and agreements of the parties herein contained and other good  and valuable consideration, the receipt and sufficiency of which are hereby acknowledged and confessed,  the parties agree as follows:  1.   Recitals.  The foregoing recitals are hereby incorporated into this Agreement for all  purposes.    2. Definitions.  For the purposes of this Agreement, the following definitions shall apply:  (a) “Competing Business” means that portion of any business which is (i)  substantially similar to and (ii) in competition with the Business of a Company.  (b) “Confidential Information” means any confidential, proprietary, or secret  information, documentation, or material (other than information that is a Trade Secret) of the Business, a  Company, the Purchaser, the Parent or any of their respective Affiliates that is not generally known or  available to the public or competitors in the trade.  (c) “Noncompetition Period” means three (3) years from and after the date hereof.  

 

17730925v4  2 (d) “Trade Secrets” means information not generally known about the Business or  any Company, the Purchaser, the Parent or any of their respective Affiliates that (i) is the subject of  efforts that are reasonable under the circumstances to maintain its secrecy or confidentiality and from  which any Company, Purchaser, the Parent or any of their respective Affiliates derives or may derive  economic value from the fact that the information is not generally known to other Persons who can obtain  economic value from its disclosure or use or (ii) is treated as a trade secret under applicable law.  Trade  Secrets include, but are not limited to, technical or non-technical data, compilations, programs and  methods, techniques, drawings, processes, financial data, research, pricing, information as to sales  representatives and suppliers, lists of or information regarding actual customers or potential customers,  customer route books, cards or lists containing the names, addresses, buying habits or business locations  of past, present or prospective customers, sales reports, service reports, price lists, product formulae or  methods and procedures relating to services.  3. Covenants of the Shareholder.  The covenants in this Section 3 are a material inducement  to the Purchaser to consummate the Acquisition, and the amounts payable to the Company under the  Purchase Agreement are in partial consideration for the covenants in this Section 3. The parties  acknowledge and agree that the covenants contained herein are designed to protect the legitimate business  interests of the Purchaser, the Parent and their respective Affiliates in the assets being acquired,  particularly the Trade Secrets, Confidential Information, substantial customer relationships, goodwill and  specialized training of the Company as developed over time and at substantial expense.  The parties  moreover acknowledge and agree that the covenants contained herein are being made because the  business connections, customers, products, techniques, goodwill and other aspects of the Business are  maintained at great expense, are long standing, are of great value to the Purchaser, the Parent and their  respective Affiliates and provide them with a substantial competitive advantage. The parties also  acknowledge and agree that (i) the types and periods of restriction imposed in this Section 3 are fair and  reasonable and are designed in order to protect and maintain the Trade Secrets, Confidential Information  and the other proprietary interests of the Company, the Purchaser, the Parent and their respective  Affiliates, other legitimate business interests of the Purchaser, the Parent and their respective Affiliates,  and goodwill associated with the Business, and (ii) the time, scope, geographic area, and other provisions  of this Section 3 have been specifically negotiated by the parties, represented by legal counsel, and are  integral parts of the transactions contemplated by the Purchase Agreement.  (a) Nondisclosure of Trade Secrets and Confidential Information.  (i) The parties agree that operation of the Business encompasses  substantially all of the Territory and that the Business enjoys a valuable and extensive trade of its  products and services.  The Shareholder has been and may continue to be entrusted with the knowledge  and possession of Trade Secrets and Confidential Information.  The parties agree that by virtue of the  Shareholder’s knowledge of the Business, the Purchaser, the Parent and their respective Affiliates may  suffer material loss and irreparable injury if the Shareholder were to disclose or use Trade Secrets or  Confidential Information in contravention of this Agreement.  (ii) The Shareholder shall keep strictly confidential and shall not, directly or  indirectly, at any time communicate or disclose to any Person other than the Purchaser or the Parent or  their respective Affiliates, or use for such Shareholder’s benefit or for the benefit of any Person other than  the Purchaser or the Parent or their respective Affiliates, any Trade Secrets or Confidential Information;  provided, however, that the Shareholder may disclose such information (A) that is generally known to the  public or known by or available to competitors in the trade (other than by virtue of any disclosure by the  Shareholder in violation of this Agreement or any other shareholder or former shareholder of the  Company in violation of such Person’s Noncompetition and Nonsolicitation Agreement), (B) as may be  required to enforce rights of the Shareholder under the Purchase Agreement or any agreement entered into  in connection therewith, (C) as may be required in response to any summons or subpoena or in connection  

 

17730925v4  3 with any litigation, or any administrative or other legal proceeding, or (D) as may be required in order to  comply with any law, order, regulation or ruling applicable to the Shareholder or the Purchaser; and  provided further that the Shareholder shall give the Purchaser reasonable prior notice of any disclosure  under the immediately preceding clauses (B), (C) or (D) in order to permit the Purchaser, the Parent or  their respective Affiliates reasonable opportunity to seek an appropriate protective order.  (iii) For the purposes of this Agreement, the obligations of the Shareholder  relating to Confidential Information only shall end at the expiration of the Noncompetition Period, and the  obligations of the Shareholder relating to Trade Secrets shall end upon the later of (x) the date on which  such information loses its character as a Trade Secret through no fault or action of the Shareholder (or any  other current or former shareholder of the Company) or (y) the expiration of the Noncompetition Period.  (iv) The Shareholder agrees not to, directly or indirectly, during the Non- Competition Period, publish or communicate (including, without limitation, in any public forum) any  defamatory or disparaging remarks, comments or statements concerning the Business or the Purchaser,  the Parent or their Affiliates or any employees, officers, directors, personnel, customers or suppliers of  any of the foregoing.    (b) Noncompetition.  The Shareholder covenants and agrees that the Shareholder  shall not, during the Noncompetition Period, either directly or indirectly, within the Territory (i) provide  or perform services for the benefit of, manage, operate, or in any way participate in, a Competing  Business, either on such Shareholder’s own behalf or on behalf of any other Person, and regardless of  whether in the capacity of an employee, agent, consultant or independent contractor, paid or otherwise, or  (ii) have a financial interest in, own or control any Competing Business, whether as a shareholder, owner,  partner, proprietor, lender or otherwise; provided, however, that the Shareholder may own, as a passive  investment, equity interests of a Competing Business if (A) such equity interests are listed on a national  securities exchange or traded on a national market system in the United States, and (B) the Shareholder,  owns beneficially and in the aggregate (directly or indirectly) less than five percent (5%) of the total  issued and outstanding equity interests of such Competing Business. The Shareholder acknowledges that  during the twelve (12) month period immediately prior to the Acquisition, the Business serviced  customers within the Territory.   (c) Nonsolicitation of Customers and Suppliers.  The Shareholder covenants and  agrees that the Shareholder shall not, during the Noncompetition Period, either directly or indirectly, in  the service or on behalf of a Competing Business, (i) attempt to divert (A) the sales of any customer to  which the Company or, to the extent such sales were attributable to the Business, any Affiliate of the  Company sold or provided any products or services, or (B) the services of any supplier, vendor or service  provider from which the Company received any products or services, in either case, at any time within the  twenty-four (24) month period prior to the Closing Date, or (ii) except with respect to the operation of a  Permitted Business, solicit (A) the sales of any customer to which the Company or, to the extent such  sales were attributable to the Business, any Affiliate of the Company sold or provided any products or  services, or (B) the services of any supplier, vendor or service provider from which the Company received  any products or services, in either case, at any time within the twenty-four (24) month period prior to the  Closing Date; provided, that in no instance shall any action permitted in this Section 3(c)(ii) violate the  terms of Section 3(c)(i).  (d) Nonsolicitation of Employees.  The Shareholder covenants and agrees that the  Shareholder shall not, during the Noncompetition Period, either directly or indirectly, hire, solicit, divert  or recruit any Person employed by the Company, the Purchaser, the Parent or any of their respective  Affiliates within six (6) months prior to such hire, solicitation, diversion or recruitment to (in the case of  solicitation, diversion or recruitment) leave such employment, whether or not such employment is  pursuant to a written contract or at will, to join a Competing Business; provided that the parties  

 

17730925v4  4 understand that the Company shall continue to employ the Current Employees after the Closing subject to  the terms of the Transition Services Agreement.  4. Severability.  The terms of this Agreement will, where possible, be interpreted and  enforced so as to sustain their legality and enforceability, read as if they cover only the specific situation  to which they are being applied and enforced to the fullest extent permissible under applicable law. If any  term of this Agreement is determined by a court of competent jurisdiction to be invalid, illegal or  incapable of being enforced, then all other terms of this Agreement will nevertheless remain in full force  and effect, and such term automatically will be amended so that it is valid, legal and enforceable to the  maximum extent permitted by applicable law, but as close to the parties’ original intent as is permissible.  5. Remedies.  (a) Injunctive Relief.  The parties expressly recognize that the subject matter of this  Agreement is unique, and that any breach of the Shareholder’s obligations under this Agreement may  result in irreparable injury to the Purchaser, the Parent and their respective Affiliates that cannot be  adequately or solely measured or compensated by the rules of law and legal remedies.  Therefore, in the  event of a breach of this Agreement by the Shareholder, the Purchaser and the Parent shall be entitled to  obtain specific performance of this Agreement through injunctive relief and such ancillary remedies of an  equitable nature as a court may deem appropriate, without the necessity of proving “irreparable harm” or  securing or posting any bond.  Such equitable relief shall be in addition to, and the availability of such  equitable relief shall not serve to preclude, any legal remedies that might be available to the Purchaser,  the Parent or any of their respective Affiliates.  (b) Tolling of Covenants upon Breach.  In addition to any other form of equitable or  legal relief, in the event that the Shareholder breaches any of the covenants set forth in Section 3 above,  then the Noncompetition Period shall be tolled and automatically extended for the period of the breach so  that the benefit of the bargain negotiated by the Purchaser may be preserved.  6. Governing Law; Dispute Resolution.  This Agreement is governed by and subject to the  laws of the State of Delaware (without giving effect to its conflict of law provisions) irrespective of the  fact that a party hereto may be a resident of another state or jurisdiction.  Notwithstanding any provision  of this Agreement to the contrary, with the exception of disputes, controversies or claims where the sole  remedy sought is injunctive relief, all disputes, controversies or claims arising out of or relating to this  Agreement shall be resolved in accordance with Section 10.10 of the Purchase Agreement.      7. Modification.  This Agreement (including the Exhibits attached hereto), together with the  Purchase Agreement, contains the entire agreement of the parties with respect to the subject matter  hereof, and this Agreement may be amended or superseded only by an agreement in writing signed by the  parties hereto.  No action or course of conduct shall constitute a waiver of any of the terms and conditions  hereof, unless such waiver is specified in writing, and then only to the extent so specified.  8. Benefit; Assignment.  This Agreement shall be binding upon and inure to the benefit of  and shall be enforceable by the parties and their respective successors and permitted assigns and, in  addition, shall inure to the benefit of and shall be enforceable by the Parent.  This Agreement shall not be  assignable by the Shareholder, but may be assigned in whole or in part by the Purchaser and any  successor to, or assignee of, the Purchaser may enforce the provisions of this Agreement.  9. Headings; Interpretation.  The headings in this Agreement are intended solely for  convenience of reference and shall be given no effect in the construction or interpretation of this  Agreement. Should any provision of this Agreement require a judicial interpretation, it is agreed that the  judicial body interpreting or construing this Agreement shall not apply the assumption that the terms of  

 

17730925v4  5 this Agreement shall be more strictly construed against one party by reason of the rule of legal  construction that an instrument is to be construed more strictly against the party which itself or through its  agents prepared the agreement.  The parties acknowledge and agree that they and their agents have each  had the opportunity to participate equally in the negotiations and preparation of this Agreement, and to  consult legal counsel regarding the terms hereof.  10. Notices.  All notices, requests, demands, claims or other communications hereunder will  be in writing and shall be deemed duly given if personally delivered, sent by facsimile, email, “pdf” (if  sent by facsimile, email, or “pdf”, such electronic delivery to be promptly followed by hardcopy via an  acceptable delivery method hereunder) or sent by a recognized overnight delivery service that guarantees  next day delivery (“Overnight Delivery”) or mailed registered or certified mail, return receipt requested,  postage prepaid, in each case transmitted or addressed to the intended recipient as set forth below:  If to the Shareholder:  [                       ]   [                       ]  [                       ]  [                       ]   [                       ]   [                       ]  with a copy to:  Ellenoff Grossman & Schole LLP  (which shall not  1345 Avenue of the Americas  constitute notice) New York, New York 10105  Facsimile: (212) 370-7889  Attn: Matthew Gray, Jonathan Cramer and Sophia Song  Email: mgray@egsllp.com;jcramer@egsllp.com and  ssong@egsllp.com  If to the Purchaser: HF Foods Group Inc.  19317-19319 Arenth Avenue  City of Industry, California 91748  Facsimile: (909) 718-8722  Attn: Victor Lee  Email: victorlee@hffoodsgroup.com with a copy to:  Sean P. Fogarty, Esq.  (which shall not  Arnall Golden Gregory LLP  constitute notice) 171 17th Street, NW, Suite 2100  Atlanta, Georgia  30363  Facsimile:  (404) 873-8151  Email: sean.fogarty@agg.com  or at such other address as any party hereto notifies the other parties hereof in writing.  The  parties hereto agree that notices or other communications that are sent in accordance herewith (a) by  personal delivery, facsimile, email or “pdf”, will be deemed received on the day sent or on the first  business day thereafter if not sent on a business day, (b) by Overnight Delivery, will be deemed received  on the first business day immediately following the date sent, and (c) by U.S. mail, will be deemed  received three (3) business days immediately following the date sent. For purposes of this Agreement, a  “business day” is a day on which the Purchaser is open for business and shall not include a Saturday or  Sunday or legal holiday.  

 

17730925v4  6 11. Expenses of Enforcement. The non-prevailing party shall be liable to, and will reimburse,  the prevailing party for all costs and expenses, including, but not limited to, reasonable attorneys’ fees,  court costs and other expenses of litigation or arbitration, incurred by the prevailing party in the  enforcement, defense or interpretation in any respect of any of its rights under this Agreement, whether in  litigation or otherwise.      12. Counterparts.  This Agreement may be executed in one or more counterparts, each of  which shall be deemed an original, but all of which together shall constitute one and the same instrument,  with the same effect as if the signatures thereto were in the same instrument.  This Agreement shall be  effective and binding on all parties when all parties have executed and delivered a counterpart of this  Agreement. Signature pages exchanged by facsimile, “pdf” or other electronic means shall be fully  binding. (Signatures on the Following Pages) 

 

17730925v4  IN WITNESS WHEREOF, the parties hereto, intending to be legally bound, have executed and  delivered this Agreement as of the day and year first above written.                     PURCHASER: Great Wall Seafood VA, L.L.C.  By:   Name: Kong Hian Lee a/k/a Victor Lee   Its: Sole Manager   (Signature Page to Shareholder Noncompetition Agreement) 

 

17730925v4  SHAREHOLDER:  [                                 ]   (Signature Page to Shareholder Noncompetition Agreement)  

 

17618573v10  Exhibit 7.1(b)(i)  Bill of Sale   (See attached)  

 

17731029v3  BILL OF SALE  KNOW ALL MEN BY THESE PRESENTS that Sealand Food, Inc., a Maryland corporation (the “Seller”), for good and valuable consideration, effective as of the date hereof, hereby sells, transfers,  assigns, conveys, grants, delivers, alienates and sets over to Great Wall Seafood VA, L.L.C., a Virginia  limited liability company (the “Purchaser”), and its successors and assigns, forever, all of the Seller’s  legal, beneficial and other right, title and interest in and to any Purchased Assets owned by the Seller as  contemplated by and pursuant to that certain Asset Purchase Agreement dated as of April    _____, 2022  (the “Agreement”; capitalized terms used but not defined herein shall have the respective meanings ascribed  to them in the Agreement), by and among the Seller, the Purchaser, and the other parties thereto, free and  clear of all Encumbrances (other than Permitted Encumbrances), to have and to hold the same, for its or  their use forever.  The Seller agrees that the Seller will, at any time and from time to time from the date hereof, upon  the request of the Purchaser (or any successor or assignee thereof), do, execute, acknowledge and deliver,  or cause to be done, executed, acknowledged or delivered, all such further acts, deeds, assignments,  transfers, conveyances and assurances as may be reasonably required for the better selling, transferring,  assigning, conveying, granting, delivering, alienating, setting over to, assuring or confirming to the  Purchaser (or any successor or assignee thereof), or for aiding in assigning and reducing to the possession  of the Purchaser (or any successor or assignee thereof), title to and possession of any and all of the  Purchased Assets sold, transferred, assigned, conveyed, granted, delivered, alienated or set over hereby, or  intended so to be.  The Seller hereby constitutes and appoints the Purchaser as the Seller’s true and lawful agent and  attorney in fact, with full power of substitution and re-substitution, in whole or in part, in the name and  stead of the Seller, but on behalf and for the benefit of the Purchaser and its successors and assigns, from  time to time:  (a) to demand, receive and collect any and all of the Purchased Assets and to give receipts and  releases for and with respect to the same, or any part thereof;  (b) to institute and prosecute, in the name of the Seller or otherwise, any and all proceedings  at law, in equity or otherwise, that the Purchaser or its respective successors and assigns may deem proper  in order to collect or reduce to possession any of the Purchased Assets and in order to collect or enforce  any claim or right of any kind hereby sold, assigned transferred, conveyed, granted, delivered, alienated, or  set over or intended so to be; and  (c) to do all things legally permissible, required or reasonably deemed by the Purchaser to be  required to recover and collect the Purchased Assets and to use the Seller’s name in such manner as the  Purchaser may reasonably deem necessary for the collection and recovery of same.  The Seller hereby declares that the foregoing powers are coupled with an interest and are and shall  be irrevocable by the Seller.  The Seller acknowledges and agrees that the representations, warranties, covenants, agreements  and indemnities contained in the Agreement shall not be superseded hereby, but shall remain in full force  and effect to the full extent provided therein. In the event of any conflict or inconsistency between the terms  of the Agreement and the terms hereof, the terms of the Agreement shall govern. (Signature on the following page.)  

 

17731029v3  IN WITNESS WHEREOF, the Seller has caused this instrument to be executed by its duly  authorized corporate representative this ___ day of _______________, 2022.  SELLER:  SEALAND FOOD, INC. By:  Name:   Its:   (Signature Page to Seller Bill of Sale)  

 

17618573v10  Exhibit 7.1(b)(ii)  Assignment Agreement   (See attached)  

 

17731101v4  ASSIGNMENT AND ASSUMPTION AGREEMENT  THIS ASSIGNMENT AND ASSUMPTION AGREEMENT (this “Agreement”) is made and  entered into as of the     ___ day of     _    _____, 2022, by and among Sealand Food, Inc., a Maryland  corporation (the “Seller”), and Great Wall Seafood VA, L.L.C., a Virginia limited liability company (the  “Purchaser”).  W I T N E S S E T H:  WHEREAS, the Seller, the Purchaser, and the other parties thereto have entered into that certain  Asset Purchase Agreement dated as of April  _____, 2022 (the “Purchase Agreement”); and  WHEREAS, this Agreement is being entered into pursuant to Section 7.1(b) of the Purchase  Agreement.  NOW, THEREFORE, in consideration of the premises, monies in hand paid and other good and  valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto  agree as follows:  1. Definitions.  Capitalized terms not otherwise defined herein shall have the meanings  ascribed to them in the Purchase Agreement.  2. Assignment of Rights; Assumption of Assumed Liabilities.  The Seller hereby transfers  and assigns to the Purchaser all of the Seller’s right, title and interest in, to and under the Purchased Assets  owned by the Seller, including, without limitation, the Owned Intellectual Property, the Intellectual  Property used in the Business, goodwill associated with the foregoing and the Assigned Contracts, and the  Purchaser hereby accepts such transfers and assignments and assumes and agrees to perform and discharge  the Assumed Liabilities (but specifically excluding the Excluded Liabilities) in accordance with the terms  thereof, subject to and in accordance with the terms and provisions of the Purchase Agreement.  3. Power of Attorney.  The Seller hereby constitutes and appoints the Purchaser as the Seller’s  true and lawful agent and attorney in fact, with full power of substitution and re-substitution, in whole or  in part, in the name and stead of the Seller, but on behalf and for the benefit of the Purchaser and its  successors and assigns, from time to time:  (a) to demand, receive and collect any and all amounts due under the Assigned  Contracts and to give receipts and releases for and with respect to the same, or any part thereof;  (b) to institute and prosecute, in the name of the Seller or otherwise, any and all  proceedings at law, in equity or otherwise, that the Purchaser or its respective successors and assigns may  deem proper in order to collect or enforce any claim or right of any kind hereby assigned or transferred, or  intended so to be; and  (c) to do all things legally permissible, required or reasonably deemed by the  Purchaser to be required with respect to any Assumed Liability or any claim or right of any kind hereby  assigned or transferred or intended so to be, and to use the Seller’s name in such manner as the Purchaser  may reasonably deem necessary for same.   The Seller hereby declares that the foregoing powers are coupled with an interest and are and shall  be irrevocable by the Seller.  

 

17731101v4  2 4. Further Assurances.  Each of the Purchaser and the Seller, as applicable, shall execute such  additional documents and instruments and take such further action as may be reasonably required or  desirable to carry out the provisions hereof.  5. Integration with the Purchase Agreement Provisions.  Nothing contained in this Agreement  shall expand, reduce, modify or waive any rights or obligations of the parties under the Purchase  Agreement, including, without limitation, the rights and obligations of the parties under Article 6 thereof.   In the event that any of the provisions of this Agreement are determined to conflict with the terms of the  Purchase Agreement, the terms of the Purchase Agreement shall control.  6. Multiple Counterparts.  This Agreement may be executed in one or more counterparts, each  of which shall be deemed an original, but all of which together shall constitute one and the same instrument.  7. Governing Law.  This Agreement shall be governed by and construed in accordance with  the internal laws of the State of Delaware, without regard to the choice of law provisions thereof.  8. Severability.  In case any provision of this Agreement shall be invalid, illegal or  unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be  affected or impaired thereby.  9. Headings.  The Section headings herein have been inserted for convenience or reference  only, and are not intended to be considered a part hereof and shall not modify or restrict any of the terms  or provisions hereof.  10. Amendments.  This Agreement may be amended, extended, superseded, canceled,  renewed, or the terms hereof may be waived, only by a written instrument signed by the parties, or, in the  case of a waiver, by the party waiving compliance.   (Signatures on the following pages) 

 

17731101v4  IN WITNESS WHEREOF, the parties hereto have executed this Assignment and Assumption  Agreement as of the date first above written.  PURCHASER:  GREAT WALL SEAFOOD VA, L.L.C. By:   Name: Kong Hian Lee a/k/a Victor Lee   Its: Sole Manager   (Signatures continue on following page)   (Signature Page to Seller Assignment and Assumption Agreement)  

 

17731101v4  SELLER:  SEALAND FOOD, INC. By:  Name:   Its:   (Signature Page to Seller Assignment and Assumption Agreement)  

 

17618573v10  Exhibit 7.(h)   Form of New Lease   (See attached)  

 

{01089783.DOCX.2} 7418 Ranco Road, Richmond, VA 23228  17757328v6  WAREHOUSE LEASE AGREEMENT  BY AND BETWEEN  POINER REALTY, LLC,  LANDLORD  AND  GREAT WALL SEAFOOD VA, L.L.C.,  TENANT  PREMISES:  LAND AND IMPROVEMENTS LOCATED AT   7418 RANCO ROAD, RICHMOND, VA 23228  DATE: [         ]/2022  

 

{01089783.DOCX.2}   7418 Ranco Road, Richmond, VA 23228  1  17757328v6  WAREHOUSE LEASE AGREEMENT  THIS WAREHOUSE LEASE AGREEMENT (this "Lease") is made as of April ____, 2022  ("Effective Date"), by and between Poiner Realty, LLC, a Virginuia limited liability company  ("Landlord"), and Great Wall Seafood VA, L.L.C., a Virginia limited liability company  ("Tenant").  Section 1. Basic Terms: (a) Address of Landlord:  5300 Heatherbook Lane, Glenn Allen, VA 23059, Attn: Tammy Lu  or such other address as may from time to time be designated by Landlord to Tenant in  writing.  (b) Address of Tenant:  19319 Arenth Avenue, City of Industry, California 91748, Attn: Victor Lee   or such other address as may from time to time be designated by Tenant to Landlord in  writing.  (c) Premises: The Land (as hereinafter defined) and the building thereon having a street  address of 7418 Ranco Road, Richmond, VA 23228 and containing approximately  44,000 rentable square feet (the "Building"), together with any parking areas,  walkways, landscaped areas and other improvements appurtenant thereto (herein  referred to as the "Premises").  (d) Land: The parcel of land described on Exhibit "A" attached hereto (the "Land").   (e) Term: A period of five (5) years commencing on April ____, 2022 (the  "Commencement Date") and expiring on April ____, 2027 (the "Expiration Date")  unless sooner terminated as set forth herein (referred to herein as the "Term").  (f) Rent: All Base Rent and Additional Rent.  (g) Base Rent: The annual Base Rent hereunder shall be $484,000.00 per annum, payable  in equal monthly installments of $40,333.33, in advance on the Commencement Date  and on the first day of each calendar month (or portion thereof) thereafter for the Term.  (h) Additional Rent: Any amounts required to be paid by Tenant under this Lease (other  than Base Rent) and any charges or expenses incurred by Landlord on behalf of Tenant  under the terms of this Lease shall be considered "Additional Rent".  Any failure on  the part of Tenant to pay such Additional Rent when and as the same shall become due  shall entitle Landlord to the remedies available to it for non-payment of Base Rent.   Tenant's obligations for payment of Additional Rent shall begin to accrue on the  Commencement Date.  (i) Permitted Use: Tenant is permitted to use the Premises solely as a warehouse for  produce distribution, restaurant supply distribution, and seafood and other food  distribution services together with such related ancillary uses such as office space for  administering the operation of such warehouse, parking, and loading, unloading and  shipping of inventory and merchandise.  

 

{01089783.DOCX.2}   7418 Ranco Road, Richmond, VA 23228  2  17757328v6  (j) Security Deposit: $40,333.33.  (k) Exhibits: Each reference in this Lease to any of the Basic Terms contained in  SectionSection 1 shall be construed to incorporate into such reference all of the  definitions set forth in SectionSection 1.  Section 2. Premises. In consideration of the rents, covenants, agreements and conditions hereinafter provided to be  paid, kept, performed and observed, Landlord does hereby lease and demise unto Tenant, and  Tenant does hereby lease and accept from Landlord, the Premises.  Notwithstanding the  foregoing, Landlord reserves the right to use up to three (3) parking spaces (“Designated  Spaces”) on the Land and to store certain maintenance equipment in the compressor room in  the Building.  The location of the Designated Spaces shall be as shown on Exhibit “B”  attached hereto (however, if such Exhibit is not attached hereto, then the location of the  Designated Spaces shall be as reasonably agreed to by Landlord and Tenant). Landlord may  store ladders, hand tools, electric power tools and similar equipment in the compressor room.   For the avoidance of doubt, Landlord will not store gasoline-powered tools such as lawn  mowers, generators, and leaf blowers or other equipment that could leak gasoline or oil  without Tenant’s consent. In material consideration for the foregoing reservation, Landlord  covenants at all times during the Term to save Tenant harmless from all claims, loss, liability,  cost, expense or damages that Tenant may incur resulting from the negligent use of the  Designated Spaces or such compressor room and/or the act of Landlord or its agents,  employees or invitees while in or on the Premises for purposes of accessing the Designated  Spaces or such compressor room.  This indemnification by Landlord of Tenant shall survive  the termination of this Lease.  Section 3. Term. Except as otherwise provided in this Lease, the Term shall be for the period commencing on  the Commencement Date and ending on the Expiration Date; provided, that Landlord shall  deliver exclusive possession of the Premises to Tenant on the Commencement Date.   Section 4. Renewal. Tenant shall have the option to renew the Term of this Lease (the "Renewal Option") for  one (1) additional term of five (5) years (the "Renewal Term") commencing on the day  following the expiration of the Term, provided that each of the following occurs:  (a) Landlord receives notice of the exercise of the Renewal Option not less than six (6)  months prior to the Expiration Date set forth in Section 1(e), time being of the essence.  (b) As of the date of the exercise of the Renewal Option and the date which is thirty (30)  days prior to the commencement of the Renewal Term, Tenant shall not be in default  under this Lease beyond any applicable notice and cure period.  

 

{01089783.DOCX.2}   7418 Ranco Road, Richmond, VA 23228  3  17757328v6  Tenant's lease of the Premises for the Renewal Term shall be upon the same terms and  conditions as set forth in this Lease, except that the annual Base Rent during each year of the  Renewal Term shall increase by three percent (3%) over the annual Base Rent for the prior  year, payable in equal monthly installments, in advance on the first day of each calendar  month (or portion thereof) thereafter occurring during the Renewal Term. Tenant shall have  no option to renew or extend this Lease beyond the expiration of the Renewal Term.  Section 5. Use of Premises.  (a) The Premises shall be used for the Permitted Use set forth in Section 1(i) and for no  other purpose.  (b) Tenant will permit no liens to attach or exist against the Premises, and shall not commit  any waste. Any claim to, or lien upon, the Premises arising from any act or omission of  Tenant shall accrue only against the leasehold estate of Tenant and shall be subject and  subordinate to the paramount title and rights of Landlord in and to the Premises.  Should the Premises or any portion thereof become subject to any mechanics, laborers'  or materialmen's lien on account of labor or material furnished to Tenant or claimed to  have been furnished to Tenant, Tenant will have such lien discharged or bonded over  within thirty (30) days of Tenant’s notice or knowledge thereof.   (c) The Premises shall not be used for any illegal purposes, and Tenant shall not allow,  suffer, or permit any vibration, noise, odor, light or other effect to occur within or  around the Premises that could constitute a nuisance or trespass with respect to the  Premises or any adjoining building or land. Upon notice by Landlord to Tenant that  any of the aforesaid prohibited uses are occurring, Tenant agrees to promptly remove  or control the same in a manner reasonably acceptable to Landlord.   (d) Tenant shall not in any way violate any law, ordinance or, if applicable, restrictive  covenant affecting the Premises, and shall not use the Premises in any manner which  may be dangerous to persons or property or would cause the cancellation of, prevent  the use of, or increase the rate of, the special form ("all risk") coverage insurance  policy maintained by Landlord or Tenant, or which would result in insurance  companies of good standing to refuse to insure the Premises on a special form ("all  risk") policy. Tenant shall not be in default hereunder for the violation of any  restrictive covenant affecting the Premises unless and until Landlord provides Tenant  with a true and correct copy thereof and Tenant is, in fact, in violation of the same and  such violation continues for more than ten (10) days after notice of such violation from  Landlord.  Section 6. Base Rent. Tenant covenants to pay without notice, deduction, set-off or abatement (except as otherwise  provided in Section 14 of this Lease) to Landlord the Base Rent specified in Section 1(g) in  lawful money of the United States in advance on the first day of each month during the Term.  Rent for any partial month shall be prorated on a per diem basis. Rent shall be payable to  Landlord at Landlord's address shown in Section 1(a) above or such other place as Landlord  may designate from time to time in writing.  

 

{01089783.DOCX.2}   7418 Ranco Road, Richmond, VA 23228  4  17757328v6  Section 7. Taxes and Other Additional Rent. (a) Commencing on the Commencement Date, Tenant agrees to pay as Additional Rent all  Taxes and Landlord's Property Insurance Costs (as hereinafter defined) due and  payable in each year of the Term. All Taxes and Landlord's Property Insurance Costs  shall be payable by Tenant to Landlord in either monthly, quarterly or annual payments  (as determined by Landlord) and shall be due within fifteen (15) days after the delivery  to Tenant of an invoice for the applicable amount. Taxes, Landlord's Property  Insurance Costs and other Additional Rent shall be appropriately adjusted for any  partial Lease year. The obligation of Tenant with respect to the payment of Additional  Rent shall survive the termination of this Lease.  (b) "Taxes" shall be defined as real estate taxes, assessments, sewer rents, rates and  charges, transit taxes, taxes based upon the receipt of rent, and any other federal, state  or local governmental charge, general, special, ordinary or extraordinary, which are  levied or assessed or become a lien against the Premises or any portion thereof, and are  payable during the Term and any tax in substitution of any of the foregoing. Taxes  shall not include any franchise, capital, stock, transfer, inheritance or income (other  than rental income) tax imposed on Landlord.  In case of special taxes or assessments  which may be payable in installments, only the amount of each installment and interest  paid thereon paid during a calendar year shall be included in taxes for that calendar  year. Taxes shall also include any personal property taxes (attributable to the year in  which paid) imposed upon the furniture, fixtures, machinery, equipment, apparatus,  systems and appurtenances of Landlord used in connection with the operation of the  Building. Taxes shall also include any expenses reasonably incurred by Landlord  (and/or persons authorized by Landlord) in contesting any of the items specified above  in this clause (b) and/or the assessed value of the Premises, or any portion thereof, as  applicable, not to exceed the amount of any reduction in Taxes obtained in connection  with such contest, which expenses shall be allocated to the tax year to which such  expenses relate. "Taxes" shall also include all charges assessed against or attributed to  the Land or the Building pursuant to any reciprocal easement agreement, or other  recorded instrument, if any, as the same may be amended from time to time, provided  and on the condition that Landlord delivers to Tenant a true and correct copy of the  same.  (c) "Landlord's Property Insurance Costs" are defined as all insurance premiums paid  by Landlord with respect to property insurance Landlord may reasonably carry from  time to time in respect of the Premises, together with reasonable deductibles.  (d) This shall be a triple net lease and Base Rent shall be paid to Landlord absolutely net of  all costs and expenses, except as herein provided. The provisions for payment of  Taxes, Landlord's Property Insurance Costs and all other Additional Rent are intended  to pass on to Tenant and reimburse Landlord for all costs and expenses incurred in  connection with ownership and operation of the Premises.  (e) If applicable in the jurisdiction where the Premises are located, Tenant shall pay and be  liable for all rental, sales, use and inventory taxes or other similar taxes, if any, on the  amounts payable by Tenant hereunder levied or imposed by any city, state, county or  other governmental body having authority, such payments to be in addition to all other  

 

{01089783.DOCX.2}   7418 Ranco Road, Richmond, VA 23228  5  17757328v6  payments required to be paid Landlord by Tenant under the terms of this Lease;  provided, however, Tenant shall have no responsibility for any income tax of any  nature payable by Landlord.  Such payment shall be made by Tenant directly to such  governmental body if billed to Tenant, or if billed to Landlord, such payment shall be  paid concurrently with the payment of the Base Rent, Additional Rent, or such other  charge upon which the tax is based, all as set forth herein.    Section 8. Utilities / Garbage Removal. (a) During the Term, Tenant shall pay as billed to Tenant, within fifteen (15) days of  receiving the applicable bill or invoice, all rents and charges for water and sewer  services and all costs and charges for gas, steam, electricity, fuel, light, power,  telephone, heat and any other utility or service used or consumed in or servicing the  Premises.  Any utilities which are not separately metered shall be billed to Tenant by  Landlord at Landlord's actual cost.    (b) Tenant at its own expense shall provide its own janitorial service and garbage removal  and carting. Tenant shall not permit the undue accumulation of debris in the Premises  or in any area immediately adjoining the Premises. Dumpsters will be stored within the  Premises in locations determined by Landlord. Tenant shall use only those dumpsters  designated by Landlord for Tenant’s garbage or shall, if requested by Landlord,  provide its own dumpsters to be placed in a location approved by Landlord in writing.  Section 9. Acceptance, Maintenance, and Repair.  (a) Tenant has inspected and knows the condition of the Premises and accepts the same in  their present condition without representation or warranty of any kind by Landlord as  to the present or future condition of the Premises, subject, however, to Landlord’s  obligations under Section 9(b) and Section 14 hereof.  Tenant shall, at its own cost and expense, maintain in good condition and repair, and  replace (when a repair is not feasible) as necessary, the entire Premises (except as  expressly provided in Section 9(b) below), including but not limited to all (i) glass,  skylights, windows, interior and entrance and exit doors, sprinkler systems, plumbing  and sewage systems, walls and wall finishes (including but not limited to, painting of  interior and exterior walls, as and when necessary), floors (including floor slabs),  ceilings, columns, entryways, pipes, mains, water and sewer connections, security  systems, truck docks and doors, dock bumpers, dock plates, dock shelters, dock seals,  and dock lighting, levelers, entrance doors, door jams, electrical facilities and  equipment including, without limitation, lighting fixtures, lamps, fans and exhaust  equipment and systems, electrical motors, heating, air conditioning and ventilation  systems, and all other appliances, fixtures and equipment of every kind and nature  located in, upon or about the Premises and (ii) signage, rail space areas, fences, water  retention facilities, lighting standards and lamps, discharge piping, fountains, pumps,  catch basins and drainage areas, driveways and parking areas (including paving,  sealing and restriping, when necessary, and removal of snow, ice and trash),  landscaped areas, walkways, curbs and all other facilities serving or relating to the  Premises. Tenant's repair and maintenance obligations under this Section 9 shall not  

 

{01089783.DOCX.2}   7418 Ranco Road, Richmond, VA 23228  6  17757328v6  apply to any maintenance or repair caused by the negligent act or willful misconduct by  Landlord occurring after the Commencement Date. Landlord hereby assigns to Tenant,  to the extent assignable, any warranties that Landlord may have (if any) that relate to  Tenant’s maintenance and repair obligations under this Lease.   (b) Subject to the provisions of Section 14 hereof, Landlord shall make or cause to be  made, all necessary repairs and replacements to the "structural components" (as  hereinafter defined) of the Building. For purposes of this Lease, the phrase "structural  components" shall mean the roof, structural walls, footings and foundation of the  Building. Landlord shall never have any obligation to repair, maintain or replace,  pursuant to this Section 9 or any other provision of this Lease, any Tenant Change (as  defined in Section 13 hereof).  (c) Landlord shall not be liable to Tenant or to any other person for any damage or  interruption of utility services occasioned by failure in any utility system or by the  bursting or leaking of any vessel or pipe in or about the Premises, or for any damage or  interruption of utility services occasioned by water coming into the Premises or arising  from the acts or negligence of occupants of adjacent property or the public.  (d) Tenant shall, at its own cost and expense, promptly and properly observe, comply with  and execute, all present and future orders, regulations, directions, rules, laws,  ordinances and requirements of all governmental authorities, (including but not limited  to State, Municipal, County and Federal governments and their departments, bureaus,  boards, and officials) (collectively, "Legal Requirements") which shall impose any  duty upon Landlord or Tenant with respect to Tenant’s use, manner of use, occupation  or alteration of the Premises made by Tenant, and shall comply with loss control  requirements issued by Landlord's insurance company(ies), affecting the Premises and  Tenant's use thereof, and save Landlord harmless from expense or damage resulting  from failure to do so.    Section 10. Insurance / Indemnity. (a) Tenant covenants and agrees that from and after the date of delivery of the Premises  from Landlord to Tenant, Tenant will carry and maintain, at its sole cost and expense,  commercial general liability insurance (for its own account and no other insured party),  which shall include broad form property damage liability coverage, extended (as per  Insurance Services Offices ("ISO") CG 0001 04/13) including bodily injury coverage,  personal and advertising injury liability coverage, product/completed operations  liability coverage, contractual liability coverage and independent contractors coverage,  in an amount not less than Five Million Dollars ($5,000,000.00) per occurrence and  general aggregate basis for property damage, personal injury and bodily injury or death  of one or more persons, Five Million Dollars ($5,000,000.00) for completed operations  and Five Million Dollars ($5,000,000.00) for personal and advertising injury; it being  agreed that such limits may be achieved via a combination of primary and  umbrella/excess insurance policies. Tenant shall be named as insured, and Landlord  and Landlord’s agents, mortgagees, and such other parties as Landlord may reasonably  request on written notice to Tenant shall be named as additional insureds on such  policy using the standard ISO CG 20 11 (04/13) form or its equivalent.  The insurance  

 

{01089783.DOCX.2}   7418 Ranco Road, Richmond, VA 23228  7  17757328v6  coverage required under this Section 10(a) shall be afforded under the standard ISO  CG 0001 (04/13) form or its equivalent, and shall not contain any exclusion for  contractual liability coverage for any of the foregoing coverages. The insurance  coverage required under this Section 10(a) shall, in addition, extend to any liability of  Tenant arising out of the indemnities by Tenant provided in this Lease.  (b) Tenant shall, from and after the Commencement Date, carry and maintain, at its sole  cost and expense, special form (formerly "all-risk") property insurance including  coverage for loss from flood, water damage from all causes including but not limited to  sprinkler damage, sewer discharge or backup, water line breakage, and overflow from  adjacent properties, vandalism and malicious mischief, covering all of Tenant’s  fixtures, equipment, personal property, wall coverings, contents and Tenant Changes  now existing or to be added, to the extent of their full replacement costs as updated  from time to time during the Term. Any such policy of property insurance shall contain  a provision that the insurer waives any right of subrogation against Landlord.  (c) Tenant shall also maintain (i) worker's compensation and disability insurance,  affording statutory coverage and containing statutory limits or better (but not less than  $1,000,000) in respect of any work or other operation on or about the Premises and (ii)  automobile liability coverage in an amount of not less than $1,000,000 each accident,  covering liability arising out of any automobile, including owned, non-owned and hired  vehicles.  (d) Tenant shall deliver to Landlord and any additional insureds, prior to the  Commencement Date, certificates of insurance and the declaration pages listing all  endorsements, in form reasonably satisfactory to Landlord issued by Tenant’s  insurance company or its authorized agent.  Tenant shall procure and pay for renewals  of such insurance from time to time before the expiration thereof, and Tenant shall  deliver to Landlord and any additional insureds a certificate of insurance and the  declaration pages listing all endorsements for each renewal policy, in form reasonably  satisfactory to Landlord, issued by Tenant’s insurance company or its authorized agent,  at least ten (10) days before the expiration of any existing policy.  All such policies  shall be issued by companies of recognized responsibility licensed to do business in the  state in which the Premises are located and rated by Best's Insurance Reports or any  successor publication of comparable standing as A-/VIII or better or the then  equivalent of such rating. Landlord shall be provided with thirty (30) days' written  notice (which may be given by Tenant or its agent) prior to any cancellation, lapse or  modification of any policy.   (e) Tenant may carry any insurance required under this Lease in the form of a so-called  blanket policy or policies of insurance covering the Premises along with other locations  of Tenant, provided the minimum amount of the total insurance afforded by such  blanket policy which shall be allocable to the Premises and any work to be performed  therein and any sub-limits of such policy allocable to the Premises shall be in amounts  which shall not be less than the minimum amounts of the insurance required hereunder,  and the protection afforded under such policy shall be not less than that which would  have been afforded under a separate policy or policies.  

 

{01089783.DOCX.2}   7418 Ranco Road, Richmond, VA 23228  8  17757328v6  (f) In the event that Tenant shall fail to carry and maintain the insurance coverages set  forth in this Section 10, Landlord may upon fifteen (15) days’ notice to Tenant (unless  such coverages will lapse in which event only a shorter notice [or no notice] to prevent  lapse shall be necessary) procure such policies of insurance and Tenant shall promptly  reimburse Landlord therefor.  (g) Landlord and Tenant hereby waive any rights each may have against the other on  account of any loss or damage occasioned to Landlord or Tenant, as the case may be,  their respective property, the Premises, its contents or to the other portions of the  Building, to the extent that such loss or damage is actually covered by such party’s  insurance coverage actually maintained or required to be maintained hereunder.   Landlord and Tenant each agree that, to the extent a waiver of subrogation is  obtainable from their respective insurance companies insuring the property of either  Landlord or Tenant, waiving any right of subrogation that such insurers may have  against Landlord or Tenant, as the case may be, for any such loss, such waiver of  subrogation shall be contained in their respective policies. If, for any reason, Tenant  fails to insure its personal property and contents (including inventory) within the  Premises (which shall be a violation of Tenant’s obligations hereunder), Tenant shall  conclusively be deemed to have waived any claim against or recovery from Landlord  to the extent that any such claim or recovery would have been covered by a special  form (formerly "all risk") property insurance policy for such personal property and  contents and therefore would have been within the scope of a waiver of subrogation  contained in such policy of insurance.  Section 11. Indemnification by Tenant.  Tenant covenants at all times to save Landlord harmless from all loss, liability, cost,  expense or damages that Landlord may incur or which may be claimed with respect to  any person or persons, corporation, or property on or about the Premises or resulting  from any act done or omission by or through the Tenant, its agents, employees,  invitees, or any person on or about the Premises by reason of Tenant's use. This  indemnification by Tenant of Landlord shall survive the termination of this Lease.  Section 12. Assignment and Subletting. (a) Tenant may not assign, mortgage, pledge, encumber or otherwise transfer this Lease, or  any interest hereunder, or sublet or otherwise permit the occupancy of the Premises  (other than by Tenant), in whole or in part, without on each occasion first obtaining the  prior express written consent of Landlord. Notwithstanding the foregoing, as long as  Tenant is not then in default under this Lease after the giving of any applicable notice  and the expiration of any applicable cure period, Tenant shall have the right, upon at  prior written notice to Landlord (setting forth the name and address and contact  information for the applicable persons or entities listed in clauses (i)-(iv) below), but  without the prior consent of Landlord, to assign this Lease or sublet the Premises or a  portion thereof to:  (i) any entity into which or with which Tenant has merged or consolidated;  (ii) any parent, subsidiary, or wholly-owned Affiliate of Tenant;  

 

{01089783.DOCX.2}   7418 Ranco Road, Richmond, VA 23228  9  17757328v6  (iii) any entity which acquires all or substantially all of the issued and outstanding  shares of capital stock of Tenant, membership interests in Tenant or partnership  interests in Tenant, as applicable; or  (iv) any purchaser of all or substantially all of Tenant’s assets and the assets of all  Affiliates of Tenant that are in the business of produce distribution, restaurant  supply distribution, and seafood and other food distribution services;  provided and on the condition that, in the event of any such transfer which is an  assignment, such transferee shall agree in writing to assume and perform all of the  terms and conditions of this Lease on Tenant’s part to be performed from and after the  effective date of such transfer. As used herein, (A) the term "Affiliate", of any person  or entity, shall mean a corporation, partnership, limited liability company or other  entity which controls, is controlled by or is under common control with such person or  entity; and (B) the term "control" shall mean (1) in the case of a corporation,  ownership or voting control, directly or indirectly, of at least fifty (50%) percent of all  the voting stock, (2) in case of a partnership, ownership, directly or indirectly, of at  least fifty (50%) percent of all the general or other partnership (or similar) interests  therein, and (3) in the case of a limited liability company or other entity, ownership,  directly or indirectly, of at least fifty (50%) percent of all the equity or other beneficial  interest(s) therein.  (b) If Tenant should desire to assign this Lease or sublet the Premises (or any part thereof),  Tenant shall give Landlord written notice no later than thirty (30) days in advance of  the proposed effective date of any proposed assignment or sublease, specifying (i) the  name and business of the proposed assignee or subtenant, (ii) a detailed description of  the intended use of the Premises by the proposed assignee or subtenant, with particular  detail regarding any Hazardous Materials which will be used in any manner at the  Premises, (iii) the amount and location of the space within the Premises proposed to be  so subleased, (iv) the proposed effective date and duration of the assignment or  subletting, and (v) the proposed rent or consideration to be paid to Tenant by such  assignee or subtenant. Tenant shall promptly supply Landlord with financial statements  and other information as Landlord may reasonably request to evaluate the proposed  assignment or sublease.  (c) Any attempted assignment or sublease by Tenant in violation of the terms and  provisions of this Section 12 shall be void and such act shall constitute a material  breach of this Lease. In no event shall any assignment, subletting or transfer, whether  or not with Landlord's consent or permitted hereunder without Landlord’s consent,  relieve Tenant of its primary liability under this Lease for the entire Term, and Tenant  shall in no way be released from the full and complete performance of all the terms  hereof. If Landlord takes possession of the Premises before the expiration of the Term  of this Lease, Landlord shall have the right, at its option to take over any sublease of  the Premises or any portion thereof and such subtenant shall attorn to Landlord, as its  landlord, under all the terms and obligations of such sublease occurring from and after  such date, but excluding previous acts, omissions, negligence or defaults of Tenant and  any repair or obligation in excess of available net insurance proceeds or condemnation  award.  

 

{01089783.DOCX.2}   7418 Ranco Road, Richmond, VA 23228  10  17757328v6  (d) Notwithstanding anything to the contrary contained in this Section 12, Tenant shall  have the right, without Landlord’s consent, to permit Sealand Food, Inc., a Maryland  corporation (“Sealand”), to occupy the Premises solely for the purposes of, and only  for such time as is necessary to, provide the Transition Services, as such term is  defined in that certain Transition Services Agreement, by and among Tenant, Sealand  and other parties thereto, dated as of the date hereof.  (e) Landlord shall have the right to sell, transfer, assign, pledge, and convey all or any part  of the Land and the Building and all of Landlord's rights under this Lease. In the event  Landlord assigns or otherwise conveys its rights under this Lease, Landlord shall be  entirely freed and released from any obligations accruing thereafter under this Lease,  and Tenant agrees to look solely to Landlord's successor in interest for performance of  such obligations.   Section 13. Tenant Alterations and Additions. (a) Except as otherwise set forth below, Tenant shall not make or permit to be made any  alterations, improvements, or additions to the Premises (a "Tenant Change"), without  first obtaining on each occasion Landlord's prior written consent, which shall not be  unreasonably withheld, conditioned or delayed with respect to interior, non-structural  alterations. Notwithstanding the foregoing, Tenant may, without Landlord’s written  approval, make cosmetic or decorative changes to the Premises such as painting,  carpeting and wall coverings, provided in each case that (i) such cosmetic or decorative  changes (A) comply with all Legal Requirements and (B) do not require any municipal  permits, approvals or signoffs, and (ii) Tenant has satisfied all of the insurance  requirements with respect to the contractors, subcontractors and laborers performing  such work as provided below.  As part of its approval process, Landlord may require  that Tenant submit plans and specifications to Landlord for Landlord's approval.   Landlord shall have the right, at any time within thirty (30) calendar days after receipt  of all such information and documentation, to give written notice to Tenant that such  Tenant Change must be removed at the end of the Term.  All Tenant Changes shall be  performed in accordance with all Legal Requirements applicable thereto and in a good  and workmanlike manner with first-class materials.  Tenant shall maintain insurance  reasonably satisfactory to Landlord during the construction of all Tenant Changes with  respect to all contractors, subcontractors and laborers performing such work. If  Landlord at the time of giving its approval to any Tenant Change notifies Tenant that  approval is conditioned upon restoration, then upon written request of Landlord,  Tenant shall, at its sole cost and expense and upon the expiration or earlier termination  of this Lease, remove the same and restore the Premises to its condition prior to such  Tenant Change.  No Tenant Change shall be structural in nature or impair the structural  strength of the Building or reduce its value.  Tenant shall pay the full cost of any  Tenant Change and shall give Landlord such reasonable security as may be requested  by Landlord to insure payment of such cost.  Except as provided in Section 16 hereof,  whether or not Landlord has required removal of any one or more Tenant Changes,  Tenant shall have the right, so long as no Event of Default has occurred, to remove all  Tenant Changes prior to the end of the Term, at the expense of Tenant, and restore the  Premises to the condition in which it existed prior to the Tenant Change which is so  

 

{01089783.DOCX.2}   7418 Ranco Road, Richmond, VA 23228  11  17757328v6  removed, normal wear and tear and damage by casualty excepted. With respect to any  Tenant Change, Landlord shall have no duty or obligation to make any replacement or  repair thereto, whether pursuant to Section 9 of this Lease or required to comply with  any Legal Requirements or otherwise, whether interior or exterior, structural or  nonstructural, ordinary or extraordinary.  Section 14. Fire and Other Casualty; Condemnation. (a) If the Premises are damaged or destroyed by fire or other casualty, Landlord shall,  subject to the limitations in this Section 14 and to the limits of the insurance proceeds it  actually receives as a result of such casualty, promptly and diligently proceed to repair,  rebuild or replace the Premises, so as to restore the Premises to the condition in which  the Premises existed immediately prior to such damage or destruction (exclusive of  Tenant Changes). If Landlord carries on any restoration or repair at the Premises  pursuant to this Section 14 and Tenant continues to occupy any other portion of the  Premises, Landlord shall take all such steps as may be reasonable and practicable to  prevent interference with Tenant's use and enjoyment of the portion of the Premises  which Tenant continues to occupy. Landlord shall perform its obligations under this  Section 14 in a manner which will achieve restoration of any damage as soon as  practicable, giving due regard to the nature and scope of the damage, subject to  extension(s) of time due to the occurrence of delays outside the reasonable control of  Landlord. Rent shall abate in proportion to the portion of the Premises that Tenant is  not reasonably able to use until Landlord has completed its restoration obligations.    (b) If (i) the Premises are (A) damaged as a result of any cause which is not covered by  Landlord’s insurance or (B) damaged or destroyed in whole or in part during the last  two (2) years of the Term; or (ii) the Building is rendered wholly or substantially  untenantable, or damaged and Landlord’s lender applies Landlord’s insurance proceeds  to the satisfaction or discharge of such loan, resulting in Landlord receiving insufficient  proceeds (together with any deductible) to repair or restore the Premises or the  Building, then in any of such events, Landlord or Tenant may elect to terminate this  Lease by serving Tenant with notice of such election to the other within sixty (60) days  after the occurrence of such event. If such notice is given, the rights and obligations of  the parties shall cease as of the date of such notice (except for those obligations of  Landlord and Tenant which are expressly stated herein to survive the Expiration Date  or earlier termination of this Lease), and Rent shall be adjusted as of the date of such  termination. In consideration for the provisions of this Section 14(b), Tenant hereby  waives any statutory rights of termination which may otherwise arise out of partial or  total destruction of the Premises which Landlord is obligated to restore.  (c) In the event the Premises is not restored in accordance with this Section 14 within two  hundred seventy (270) days from the date of the casualty, Tenant shall have the right to  terminate this Lease upon written notice to Landlord given prior to the time that such  restoration is complete. If such notice is given, the rights and obligations of the parties  shall cease as of the date of such notice (except for those obligations of Landlord and  Tenant which are expressly stated herein to survive the Expiration Date or earlier  termination of this Lease), and Rent shall be adjusted as of the date of such  termination.  

 

{01089783.DOCX.2}   7418 Ranco Road, Richmond, VA 23228  12  17757328v6  (d) In the event that the whole or any part of the Premises shall be permanently taken for  public or quasi-public use or condemnation under the power of eminent domain, this  Lease shall terminate as to the part so taken on the date possession is yielded to the  condemning authority. In the event that any portion of the Premises so taken  substantially impairs the access to or the usefulness of the Premises for the purposes  hereinbefore granted to Tenant, either party may terminate this Lease by notice served  upon the other within thirty (30) days of the actual physical taking, except in case of a  temporary taking, in which event Tenant’s sole remedy shall be the receipt of an  equitable abatement of Rent. For the purposes of this Section 14(d), a voluntary sale or  conveyance in lieu of condemnation, but under threat of condemnation, shall be  deemed an appropriation or taking under the power of eminent domain. If this Lease is  not terminated as above provided, following any of such actual taking, then Landlord  shall restore the remaining Premises into a complete architectural unit (but in no event  shall Landlord be obligated to spend more than the amount of the award received on  account of the taking of the Premises) and a proportionate adjustment shall be made in  the Rent based on the proportion of the Premises remaining as compared to the original  Premises. All compensation awarded for any taking of the fee and the leasehold, or any  part thereof, shall belong to and be the property of Landlord.  Tenant hereby assigns to  Landlord all right, title and interest of Tenant in and to any award made for leasehold  damages and/or diminution in the value of Tenant’s leasehold estate. Tenant shall have  the right to claim such compensation as may be separately awarded or allocated by  reason of the cost or loss to which Tenant might be put in removing Tenant’s  inventory, fixtures and equipment, as well as relocation expenses, provided such claim  does not reduce Landlord’s award.  Compensation as used in this Section shall mean  any award given to Landlord for such taking in excess of, and free and clear of, all  prior claims of the holders of any mortgages or security interests. Any such  appropriation or condemnation proceedings shall not operate as (or be deemed an  eviction of Tenant or) a breach of Landlord’s covenant of quiet enjoyment.  Tenant  hereby waives any statutory rights of termination which may arise by reason of any  partial taking of the Premises under the power of eminent domain.  Section 15. Personal Property. All of Tenant's personal property in the Premises shall be and remain at Tenant's sole risk,  and Landlord shall not be liable for and Tenant hereby releases Landlord from any and all  liability for theft thereof or any damage thereto.  Landlord shall not be liable for any loss or  damage to any merchandise, fixtures, equipment or personal property of Tenant or any other  party in or about the Premises, regardless of the cause of such loss or damage and shall not  be required to repair or replace such personal property in the event of a casualty loss.  Section 16. Fixtures. All buildings, repairs, alterations, additions, improvements, installations, and any other  fixtures used in the operation of the Premises or Building (as distinguished from operations  incident to the business of Tenant) shall belong to Landlord and remain and be surrendered  with the Premises as a part thereof at the expiration of this Lease or any extension thereof.   

 

{01089783.DOCX.2}   7418 Ranco Road, Richmond, VA 23228  13  17757328v6  Tenant shall have the right to install in the Premises trade fixtures and personal property  required by Tenant or used by it in its business so long as the installation of the same does  not damage the Premises. All of Tenant's trade fixtures and all personal property, apparatus,  machinery and equipment, now or hereafter located upon the Premises, other than Building  fixtures as defined above, shall be and remain the personal property of Tenant and the same  are herein referred to as "Tenant's Equipment".  Tenant's Equipment may be removed from  time to time by Tenant; provided, that if such removal shall injure or damage the Premises,  Tenant shall repair the damage and place the Premises in the same condition as it would have  been if such equipment had not been installed.  Section 17. Landlord's Lien. Landlord hereby waives any statutory liens with respect to Tenant's merchandise and  inventory and Tenant’s Equipment kept or warehoused at the Premises.  Section 18. Default and Remedies. (a) The occurrence of any one or more of the following events shall constitute an "Event  of Default" of Tenant under this Lease:  (i) if Tenant fails to pay Base Rent or any Additional Rent hereunder as and when  such rent becomes due and such failure continues for ten (10) calendar days after  said due date;  (ii) if Tenant permits anything which creates a lien upon the Premises and fails to  discharge, bond such lien or post security with Landlord acceptable to Landlord  within thirty (30) days after receipt by Tenant of written notice thereof;  (iii) if Tenant fails to maintain in force all policies of insurance required by this Lease;  (iv) if any petition is filed by or against Tenant under any present or future section or  chapter of the Bankruptcy Code, or under any similar law or statute of the United  States or any state thereof (which, in the case of an involuntary proceeding, is not  permanently discharged, dismissed, stayed, or vacated, as the case may be, within  sixty (60) days of commencement), or if any order for relief shall be entered  against Tenant in any such proceedings;  (v) if Tenant becomes insolvent or makes a transfer in fraud of creditors or makes an  assignment for the benefit of creditors;  (vi) if a receiver, custodian, or trustee is appointed for the Premises or for all or  substantially all of the assets of Tenant, which appointment is not vacated within  sixty (60) days following the date of such appointment; or   (vii) if Tenant fails to perform or observe any term of this Lease not otherwise  specified in this Section 18(a) and such failure shall continue for more than thirty  (30) days after Landlord gives Tenant notice of such failure; provided, however,  that if such breach or failure cannot reasonably be cured within such thirty (30)  day period, such thirty (30) day period shall be extended until such cure is  

 

{01089783.DOCX.2}   7418 Ranco Road, Richmond, VA 23228  14  17757328v6  complete up to a maximum of one hundred twenty (120) days so long as Tenant  diligently and continuously prosecutes such cure.  (b) Upon the occurrence of any Event of Default, Landlord may, at Landlord's option,  without any demand or notice whatsoever:  (i) Terminate this Lease by giving Tenant notice of termination, in which event this  Lease shall expire and terminate on the date specified in such notice of  termination and all rights of Tenant under this Lease and in and to the Premises  shall terminate.  Tenant shall remain liable for all obligations under this Lease  arising up to the date of such termination, and Tenant shall surrender the Premises  to Landlord on the date specified in such notice; or  (ii) Terminate this Lease as provided in clause (i) above and recover from Tenant all  actual damages Landlord may incur by reason of Tenant's default, including,  without limitation, a sum which, at the date of such termination, represents the  value of the excess, if any, of (A) the Base Rent, Additional Rent and all other  sums which would have been payable hereunder by Tenant for the period  commencing with the day following the date of such termination and ending with  the Expiration Date had this Lease not been terminated, over (B) the aggregate  reasonable rental value of the Premises for the period commencing with the day  following the date of such termination and ending with the Expiration Date had  this Lease not been terminated, plus (C) the costs of recovering possession of the  Premises and all other expenses incurred by Landlord due to Tenant's default,  including, without limitation, reasonable attorney's fees, plus (D) the unpaid Base  Rent and Additional Rent earned as of the date of termination plus any interest  and late fees due hereunder, plus other sums of money and damages owing on the  date of termination by Tenant to Landlord under this Lease or in connection with  the Premises, all of which excess sum shall be deemed immediately due and  payable; provided, however, that such payments shall not be deemed a penalty but  shall merely constitute payment of liquidated damages, it being understood and  acknowledged by Landlord and Tenant that actual damages to Landlord are  extremely difficult, if not impossible, to ascertain; or  (iii) Without terminating this Lease, Landlord may, in accordance with applicable law,  dispossess Tenant from the Premises pursuant to any available judicial proceeding  and thereupon enter into and upon and take possession of the Premises or any part  thereof.  Any property then remaining in the Premises may be removed and stored  in a warehouse or elsewhere at the cost of, and for the account of Tenant without  Landlord becoming liable for any loss or damage which may be occasioned  thereby unless caused by Landlord's gross negligence or willful misconduct.   Thereafter, Landlord may, but shall not be obligated to, lease to a third party the  Premises or any portion thereof as the agent of Tenant upon such terms and  conditions as Landlord may deem necessary or desirable in order to relet the  Premises.  The remainder of any rentals received by Landlord from such reletting,  after the payment of any indebtedness due hereunder from Tenant to Landlord,  and the payment of any costs and expenses of such reletting (including, without  limitation, leasing commissions and costs of preparing the Premises for reletting),  shall be held by Landlord to the extent of and for application in payment of future  

 

{01089783.DOCX.2}   7418 Ranco Road, Richmond, VA 23228  15  17757328v6  rent owed by Tenant, if any, as the same may become due and payable hereunder,  plus the costs and expenses relating to reletting as described in the immediately  preceding sentence.  If such rentals received from such reletting shall at any time  or from time to time be less than sufficient to pay to Landlord the entire sums then  due from Tenant hereunder, Tenant shall pay any such deficiency to Landlord.   Notwithstanding any such reletting without termination, Landlord may at any  time thereafter elect to terminate this Lease for any such previous default  provided same has not been cured; or  (iv) Without liability to Tenant or any other party and without constituting a  constructive or actual eviction, suspend or discontinue furnishing or rendering to  Tenant any property, material, labor, utilities or other service, wherever Landlord  is obligated to furnish or render the same so long as Tenant is in default under this  Lease; or  (v) With or without terminating this Lease, allow the Premises to remain unoccupied  and collect rent from Tenant as it comes due; provided that nothing contained in  this Lease will relieve Landlord of its duty to mitigate its damages to the extent  required under the laws of the State in which the Building is located; or  (vi) Pursue such other remedies as are available at law or equity.  (c) If this Lease shall terminate as a result of or while there exists an Event of Default  hereunder, any funds of Tenant held by Landlord may be applied by Landlord to any  damages payable by Tenant (whether provided for herein or by law) as a result of such  termination or default.  (d) Neither the commencement of any action or proceeding, nor the settlement thereof, nor  entry of judgment thereon shall bar Landlord from bringing subsequent actions or  proceedings from time to time, nor shall the failure to include in any action or  proceeding any sum or sums then due be a bar to the maintenance of any subsequent  actions or proceedings for the recovery of such sum or sums so omitted.  (e) No agreement to accept a surrender of the Premises and no act or omission by Landlord  or Landlord's agents during the Term shall constitute an acceptance or surrender of the  Premises unless made in writing and signed by Landlord.  No re-entry or taking  possession of the Premises by Landlord shall constitute an election by Landlord to  terminate this Lease unless a written notice of such intention is given to Tenant.  No  provision of this Lease shall be deemed to have been waived by either party unless  such waiver is in writing and signed by the party making such waiver.  Landlord's  acceptance of Base Rent or Additional Rent in full or in part following an Event of  Default hereunder shall not be construed as a waiver of such Event of Default.  No  custom or practice which may grow up between the parties in connection with the  terms of this Lease shall be construed to waive or lessen either party's right to insist  upon strict performance of the terms of this Lease, without a written notice thereof to  the other party.   (f) If an Event of Default shall occur and Landlord has terminated this Lease and/or  recovered possession of the Premises as a result thereof, Tenant shall pay to Landlord,  within fifteen (15) days of written demand, all expenses incurred by Landlord as a  

 

{01089783.DOCX.2}   7418 Ranco Road, Richmond, VA 23228  16  17757328v6  result thereof, including reasonable attorneys’’ fees, court costs and expenses actually  incurred by Landlord. Landlord may, at the option of Landlord, cure any Event of  Default and the actual cost of such cure shall be payable by Tenant to Landlord within  thirty (30) calendar days after written demand and shall bear interest at twelve percent  (12%) until repayment in full by Tenant occurs; provided, however, that if a failure by  Tenant to perform or observe any term of this Lease gives rise to circumstances or  conditions which constitute an emergency threatening human health or safety,  Landlord shall, after making a reasonable effort to notify Tenant, be entitled to take  immediately curative action to the extent necessary to eliminate the emergency.  Any  cost so incurred by Landlord shall be reasonably incurred and must not exceed the  scope of the Event of Default in question; and if such costs are chargeable as a result of  labor or materials provided directly by Landlord, rather than by unrelated third parties,  the cost shall not exceed the amount which would have been charged by a qualified  third party unrelated to Landlord.  Such costs must be reasonably documented and  copies of such documentation must be delivered to Tenant with the written demand for  reimbursement.  (g) Landlord Default.  The occurrence of any of the following shall constitute an event of  default on the part of Landlord under this Lease (a "Landlord Default"):  Landlord being in breach of or failing to perform, comply with or observe any term,  covenant, warranty, condition, agreement or undertaking of Landlord contained in or  arising under this Lease and such failure continuing for a period of thirty (30) days  after notice thereof is given by Tenant to Landlord; provided, however, that if such  breach or failure cannot reasonably be cured within such thirty (30) day period, such  thirty (30) day period shall be extended until such cure is complete up to a maximum  of one hundred twenty (120) days so long as Landlord diligently and continuously  prosecutes such cure.  Tenant shall have all rights and remedies available at law or equity for any Landlord Default.   Such rights and remedies shall include, without limitation, the right to seek damages and/or  equitable relief by temporary or permanent injunction or restraining order for the breach.  No  right or remedy conferred on or reserved to Tenant is intended to be exclusive of any other  right or remedy in this Lease, at law or in equity, but each right and remedy shall be  cumulative.  Section 19. Landlord's Right of Entry. Tenant agrees to permit Landlord and the authorized representatives of Landlord and of  Mortgagee to enter upon the Premises at all reasonable times for the purposes of inspecting  the Premises, ascertaining Tenant's compliance with this Lease, curing any Event of Default  and making any repairs required to be performed by Landlord; provided that, except in the  case of an emergency, Landlord shall give Tenant reasonable prior notice of Landlord's  intended entry upon the Premises.  Nothing herein shall imply any duty upon the part of  Landlord to do any work required of Tenant hereunder, and the performance thereof by  Landlord shall not constitute a waiver of Tenant's default in failing to perform it. Landlord  shall not be liable for inconvenience, annoyance, disturbance or other damage to Tenant by  

 

{01089783.DOCX.2}   7418 Ranco Road, Richmond, VA 23228  17  17757328v6  reason of making such repairs or the performance of such work in the Premises or on account  of bringing materials, supplies and equipment into or through the Premises during the course  thereof and the obligations of Tenant under this Lease shall not thereby be affected;  provided, however, that Landlord shall use reasonable efforts not to interfere with Tenant's  operations in the Premises in making such repairs or performing such work. Landlord shall  also have the right, upon giving prior notice to Tenant, to enter the Premises at reasonable  times to exhibit the Premises to any prospective purchaser or Mortgagee and, during the last  12 months of the Term (or Renewal Term, if applicable), to prospective tenants; provided  that Landlord shall use reasonable efforts not to interfere with Tenant's operations in the  Premises during such times. Subject to Section 10(g) and the last paragraph of Section 18  hereof, such entry by Landlord shall be subject to any claims by Tenant for any damage or  loss suffered by Tenant by reason of such entry.  Section 20. Mortgagee's Rights. (a) For purposes of this Lease:  (i) "Mortgagee" as used herein means the holder of a Mortgage;  (ii) "Mortgage" as used herein means any or all mortgages, deeds to secure debt,  deeds of trust or other instruments in the nature thereof which may now or  hereafter affect or encumber Landlord's title to the Premises, and any  amendments, modifications, extensions or renewals thereof.  (b) This Lease and all rights of Tenant hereunder are and shall be subordinate to the lien  and security title of any Mortgage.  Tenant recognizes and acknowledges the right of  Mortgagee to foreclose or exercise the power of sale against the Premises under any  Mortgage.  (c) Tenant shall, in confirmation of the subordination set forth in clause (b) above and  notwithstanding the fact that such subordination is self-operative, and no further  instrument or subordination shall be necessary, upon demand, at any time or times,  execute acknowledge, and deliver to Landlord or to Mortgagee any and all instruments  requested by either of them to evidence such subordination.  (d) At any time during the Term, Mortgagee may, by written notice to Tenant, make this  Lease superior to the lien of its Mortgage. If requested by Mortgagee, Tenant shall,  upon demand, at any time or times, execute, acknowledge and deliver to Mortgagee,  any and all instruments that may be necessary to make this Lease superior to the lien of  any Mortgage.  (e) If Mortgagee (or Mortgagee's nominee, or other purchaser at foreclosure) shall  hereafter succeed to the rights of Landlord under this Lease, whether through  possession or foreclosure action or delivery of a new Lease, Tenant shall attorn to and  recognize such successor as Tenant's Landlord under this Lease without change in the  terms and provisions of this Lease and shall promptly execute and deliver any  instrument that may be necessary to evidence such attornment, provided that such  successor shall not be bound by (i) any payment of Base Rent or Additional Rent for  more than one month in advance, (ii) the defaults of any prior Landlord under this  Lease, or (iii) any offset rights arising out of the defaults of any prior Landlord under  

 

{01089783.DOCX.2}   7418 Ranco Road, Richmond, VA 23228  18  17757328v6  this Lease.  Upon such attornment, this Lease shall continue in full force and effect as a  direct lease between each successor Landlord and Tenant, subject to all of the terms,  covenants and conditions of this Lease.  Section 21. Landlord Liability. No owner of the Premises, whether or not named herein, shall have liability hereunder after it  ceases to hold title to the Premises, except for obligations which may have theretofore  accrued.  Neither Landlord nor any officer, director, shareholder, partner or principal of  Landlord, whether disclosed or undisclosed, of Landlord shall be under any personal liability  with respect to any of the provisions of this Lease.  In the event Landlord is in breach or  default with respect to Landlord's obligations or otherwise under this Lease, Tenant shall  look solely to the interest of Landlord in the Premises (and, following any court awarded  judgment obtained by Tenant against Landlord prior to a sale of the Premises, the proceeds  from such sale), for the satisfaction of Tenant's remedies.  It is expressly understood and  agreed that Landlord's liability under the terms, covenants, conditions, warranties and  obligations of this Lease shall in no event exceed Landlord's interest in the Premises (and,  following any court awarded judgment obtained by Tenant against Landlord prior to a sale of  the Premises, the proceeds from such sale).  Section 22. Notices. Any notice or payment required or permitted to be given or served by either party to this  Lease shall be deemed given when made in writing and either (i) personally delivered, (ii)  deposited with the United States Postal Service, postage prepaid, to be mailed by registered  or certified mail, return receipt requested, or (iii) delivered by overnight delivery service  providing proof of delivery, properly addressed to the address set forth in Section 1(a)of the  Basic Terms (as the same may be changed to another address in the Continental United  States by giving written notice of the change not less than ten (10) days prior to effective date  of the change); provided, however, that the time period allowed for a response to any notice  so given shall not commence until the date of actual receipt of the notice.  Refusal to accept  delivery or inability to deliver as a result of a change of address as to which no notice was  properly given shall be deemed receipt. Notices from Landlord may be given by Landlord's  managing agent, if any, or by Landlord's attorney, and notices from Tenant may be given by  Tenant's attorney.    Section 23. Waiver. (a) The rights and remedies under this Lease, as well as those provided or accorded by  law, shall be cumulative, and none shall be exclusive of any other rights or remedies  hereunder allowed by law.  A waiver by Landlord or Tenant, as applicable, of any  breach or breaches, default or defaults hereunder shall not be deemed or construed to  be a continuing waiver of such breach or default nor a waiver of or permission, for any  subsequent breach or default, and it is agreed that the acceptance by Landlord of any  installment of Rent subsequent to the date the same should have been paid hereunder,  shall in no manner alter or affect the covenant and obligation of Tenant to pay  

 

{01089783.DOCX.2}   7418 Ranco Road, Richmond, VA 23228  19  17757328v6  subsequent installments of Rent promptly upon the due date thereof.  No receipt of  money by Landlord after the termination in any way of this Lease shall reinstate,  continue, or extend the Term.  Tenant hereby expressly waives, so far as permitted by  law, the service of any notice of intention to re-enter as well as any rights of  redemption or repossession provided for in any statute.  (b) Tenant agrees that Tenant shall not have the right to sue for or collect, and Landlord  shall never have any liability or responsibility whatsoever for, any consequential,  punitive, speculative or indirect damages including without limitation lost profits,  whether proximately or remotely related to any default of Landlord under this Lease or  any act, omission or negligence of Landlord, its agents, contractors or employees, and  Tenant hereby waives any and all such rights.  (c) Tenant and Landlord hereby knowingly and voluntarily waive trial by jury in any  action, proceeding or counterclaim brought by one party against the other, concerning  any matter arising out of or in any way connected with this Lease, the relationship of  Landlord and Tenant created hereby, Tenant’s use or occupancy of the Premises and/or  any claim for injury or damage.  

 

{01089783.DOCX.2}   7418 Ranco Road, Richmond, VA 23228  20  17757328v6  Section 24. Successors. The provisions, covenants and conditions of this Lease shall bind and inure to the benefit of  the legal representatives, heirs, successors and assigns of each of the parties hereto, except  that no assignment or subletting by Tenant without the written consent of Landlord shall vest  any right in the assignee or subtenant of the Tenant.  When used herein Landlord shall mean  the party which is from time to time the Landlord under this Lease, and upon transfer of the  interest hereunder of a Landlord, such transferor shall have no further liabilities hereunder.    Section 25. Quiet Possession. Subject to the terms and conditions of this Lease and to the liens of any Mortgages or other  liens to which this Lease is subordinate pursuant to the terms hereof, Landlord agrees that so  long as Tenant is not in default of this lease beyond applicable notice and cure periods,  Tenant shall and may peaceably and quietly have, hold and enjoy the Premises during the  Term hereof without such possession being disturbed or interfered with by Landlord or by  any person claiming by, through or under Landlord, save and except in the event of the  taking of the Premises by public or quasi-public authority as hereinbefore provided.  Section 26. Bankruptcy. Neither this Lease nor any interest therein nor any estate hereby created shall pass to any  trustee or receiver in bankruptcy or to any other receiver or assignee for the benefit of  creditors by operation of law or otherwise during the Term of this Lease or any renewal  thereof.  Section 27. Holding Over. If Tenant remains in possession of the Premises after expiration of the Term, with or without  Landlord's acquiescence and without any express agreement of the parties, Tenant shall be a  tenant-at-sufferance at one-hundred-and-fifty-percent (150%) of the Base Rent in effect at  the end of the Term. In addition to the foregoing, in the event that Tenant remains in  possession of the Premises for more than sixty (60) days after the Expiration Date or earlier  termination of the Term, Tenant shall be liable for all damages incurred by Landlord as a  result of such holdover.  Tenant shall also continue to pay all other Additional Rent due  hereunder, and there shall be no renewal of this Lease by operation of law.  No receipt of  money by Landlord from Tenant after the termination of this Lease or Tenant's right of  possession of the Premises shall reinstate, continue or extend the Term or Tenant's right of  possession.  Section 28. Surrender of Possession.  (a) Upon termination of this Lease, whether by forfeiture, lapse of time or otherwise, or  upon termination of Tenant's right to possession of the Premises, Tenant will at once  surrender and deliver the Premises, together with all improvements thereon to Landlord  broom clean in good order, condition and repair, reasonable wear and tear and loss due  

 

{01089783.DOCX.2}   7418 Ranco Road, Richmond, VA 23228  21  17757328v6  to fire or other casualty for which Tenant is not responsible hereunder excepted.   "Broom clean" means free from all debris, dirt, rubbish, personal property of Tenant,  oil, grease, tire tracks or other substances, inside and outside the Building and on the  grounds comprising the Premises and with all lighting fixtures in working order.  (b) Upon termination, Tenant shall remove Tenant's fixtures and any alterations required  by Landlord to be removed, provided any damage caused by removal of Tenant from  the Premises, including any damage caused by removal of Tenant's fixtures shall be  repaired and paid for by Tenant.  In the event Tenant does not remove Tenant's fixtures  and all Tenant's personal property from the Premises within a reasonable time, then, at  Landlord's option, Tenant shall be conclusively presumed to have conveyed the same  to Landlord under this Lease as a bill of sale without further payment or credit by  Landlord to Tenant and Landlord may remove the same and Tenant shall pay the cost  of such removal to Landlord upon demand.  Section 29. Americans With Disabilities Act. Landlord and Tenant acknowledge that the Americans With Disabilities Act of 1990 (42  U.S.C. §12101 et seq.) and regulations and guidelines promulgated thereunder, as all of the  same may be amended and supplemented from time to time (collectively referred to herein as  the "ADA") establish requirements for business operations, accessibility and barrier removal,  and that such requirements may or may not apply to the Premises, the Building and the  property on or about the Premises or Building depending on, among other things: (i) whether  Tenant's business is deemed a "public accommodation" or "commercial facility", (ii) whether  such requirements are "readily achievable", and (iii) whether a given alteration affects a  "primary function area" or triggers "path of travel" requirements.  The parties hereby agree  that: (a) Landlord shall be responsible for ADA Title III compliance for entry into the  Premises as of the Commencement Date, (b) Tenant shall be responsible for ADA Title III  compliance with respect to the Premises after the Commencement Date, including any  leasehold improvements or other work to be performed in the Premises by Tenant under or in  connection with this Lease, (c) Landlord may perform, or require that Tenant perform, and  Tenant shall be responsible for the cost of, ADA Title III "path of travel" requirements  triggered by Tenant Changes, and (d) Landlord may perform, or require Tenant to perform,  and Tenant shall be responsible for the cost of, ADA Title III compliance in the Premises  being deemed to be a "public accommodation" instead of a "commercial facility" as a result  of Tenant's use of the Premises.  Tenant shall be solely responsible for requirements under  Title I of the ADA relating to Tenant's employees.  Tenant agrees to cooperate with Landlord and to comply with any and all guidelines or  controls concerning energy management imposed upon Landlord by federal or state  governmental organizations or by any energy conservation association to which Landlord is a  party or which is applicable to the Building.  Section 30. Entire Agreement; No Recording.   This Lease contains the entire agreement between the parties, and no modification of this  Lease shall be binding upon the parties unless evidenced by an agreement in writing signed  

 

{01089783.DOCX.2}   7418 Ranco Road, Richmond, VA 23228  22  17757328v6  by the Landlord and the Tenant after the Effective Date.  If there be more than one Tenant  named herein, the provisions of this Lease shall be applicable to and binding upon such  Tenants, jointly and severally.  Neither this Lease, nor any memorandum or short-form  hereof, shall be recorded.  Section 31. Right of First Offer. (a) Before Landlord may sell the Premises to any third party, including, without limitation,  pursuant to an unsolicited offer, Landlord must first offer to sell the Premises to Tenant  by giving written notice ("Landlord’s Offer") of the terms and conditions on which  Landlord is willing to sell the Premises (including, without limitation, purchase price,  deposit, closing date and condition of title).  Tenant will have thirty (30) days after the  date of receipt of Landlord’s Offer within which to notify Landlord that Tenant accepts  Landlord’s Offer on the terms and conditions therein contained.  Failure of Tenant to  respond, as aforesaid, to Landlord’s Offer within said thirty (30) day period shall be  deemed a rejection thereof, and upon Landlord’s request, Tenant shall promptly  execute and deliver to Landlord a certificate reciting that Tenant received Landlord’s  Offer and rejected or failed to accept said Landlord’s Offer (however, any failure of  Tenant to deliver such certificate will not affect any such rejection).  If Tenant accepts  Landlord’s Offer, the closing of such sale to Tenant will take place pursuant to the  terms of Landlord’s Offer.  If Tenant rejects or does not accept Landlord’s Offer in  writing within the aforementioned thirty (30) day period, Landlord may sell the  Premises to any other person at a price equal to or greater than ninety-five percent  (95%) of that set forth in Landlord’s Offer and upon terms and conditions not  materially more favorable to the buyer than those set forth in Landlord’s Offer within  nine (9) months after the date of Landlord’s Offer.  At the end of such nine (9) month  period, the right of Landlord to sell the Premises free from the right of first offer  hereby granted will terminate, and the provisions of this Section 31 will apply to any  subsequent proposed sale of the Premises by Landlord, to the extent still applicable.   Notwithstanding the foregoing, in the event the Landlord enters into a valid and  binding purchase and sale agreement with a prospective buyer, which agreement is  fully executed by both parties and delivered within such nine (9) month period, then, in  such event, upon written notice thereof to Tenant, together with substantiating evidence  of such executed agreement, such nine (9) month period shall be extended up to and  including an additional three (3) months, within which Landlord and the prospective  purchaser may close on the sale of the Premises. This right of first offer shall remain in  full force and effect solely throughout the Term of this Lease, but shall expire  contemporaneously and be inapplicable if this Lease is terminated or Tenant is  dispossessed by reason of a default by Tenant hereunder.    (b) Notwithstanding any provision in Section 31(a) to the contrary, the provisions of this  Section 31 shall not apply in any event to the intra-familial sale or transfer of the  Premises to members, principals, shareholders or beneficial owners of Landlord or  their respective families including without limitation, parents, children, aunts, uncles  and cousins, or trusts therefor, or the estate of an individual holder of an interest in  Landlord.  

 

{01089783.DOCX.2}   7418 Ranco Road, Richmond, VA 23228  23  17757328v6  Section 32. Security Deposit.  (a) Concurrently with its execution and submission of this Lease, Tenant shall deposit with  Landlord the amount set forth in Section 1(j) above by official bank check or wire  transfer ( the "Security Deposit"), as security for the full, prompt and faithful  performance by Tenant of all of its obligations hereunder.  (b) The Security Deposit or any portion thereof may be applied to the curing of any default  by Tenant under this Lease beyond any applicable notice and/or cure period without  prejudice to any other remedy or remedies which Landlord may have on account  thereof, and upon such application, Tenant shall forthwith upon demand restore the  Security Deposit so that, at all times, the amount of the Security Deposit shall not be  less than the amount set forth in Section 1(j) above. The use or application of the  Security Deposit shall not prevent Landlord from exercising any or right or remedy  available to Landlord and shall not be construed as liquidated damages. The issuance  of a warrant and the re-entering of the Premises by Landlord for any default on the part  of Tenant prior to the Expiration Date shall not be deemed such a termination of this  Lease as to entitle Tenant to recovery of the Security Deposit; and the Security Deposit  shall be retained and remain in the possession of Landlord until sixty (60) days after  the later of the Expiration Date or the date Tenant delivers possession of the Premises  to Landlord in the condition required by this Lease, unless otherwise applied by  Landlord pursuant to the provisions of this Section 32.  (c) If the Premises are transferred by Landlord, then Landlord shall have the right to  transfer the Security Deposit to Landlord’s successor or transferee, and to the extent the  Security Deposit is actually transferred or credited to such successor or transferee,  Tenant shall look solely to such successor or transferee for the return of same. No  Mortgagee holding a Mortgage to which this Lease is subordinate shall be responsible  in connection with the Security Deposit by way of credit or payment of any Rent or  otherwise, unless such Mortgagee actually shall have received the Security Deposit  hereunder.   (d) To the extent permitted by applicable Legal Requirements, Landlord or its successors  shall not be obligated to hold the Security Deposit as separate funds, but may  commingle it with other funds.  (e) If Tenant shall have nevertheless performed all of the covenants and agreements in this  Lease contained on the part of Tenant to be performed, the Security Deposit, or any  then remaining balance thereof, shall be returned to Tenant, without interest, within  sixty (60) days after the later of the Expiration Date or the date Tenant delivers  possession of the Premises to Landlord in the condition required by this Lease. In the  absence of evidence satisfactory to Landlord of any assignment of the right to receive  the Security Deposit, or the remaining balance thereof, Landlord may return the  Security Deposit to the original Tenant, regardless of one or more assignments of the  Lease itself.  (f) The Security Deposit shall not be assigned or encumbered by Tenant. Tenant  acknowledges and agrees that the Security Deposit is not an asset of the Tenant but  constitutes consideration and a material inducement to Landlord for the execution and  delivery of this Lease.  

 

{01089783.DOCX.2}   7418 Ranco Road, Richmond, VA 23228  24  17757328v6  Section 33. Hazardous Materials.  (a) Landlord represents to Tenant that, to Landlord's actual knowledge, the Premises  currently contain no Hazardous Materials in violation of any Legal Requirements. If  there is a contamination of the Premises in violation of Legal Requirements which is  caused or by Landlord, its agents, employees, or contractors after the Commencement  Date, or if contamination of the Premises in violation of Legal Requirements otherwise  exists prior to the Commencement Date for which Landlord is legally liable for damage  resulting therefrom, then Landlord shall indemnify, defend and hold Tenant harmless  from and against any and all claims, judgments, damages, penalties, fines, costs,  liabilities or losses (including damages for the loss or restriction on use of rentable or  usable space of the Premises, and sums paid in settlement of claims, reasonable  attorneys’ fees and disbursements, consultant fees and expert fees) which arise during  or after the Term as a result of such contamination. The indemnification of Tenant by  Landlord herein includes costs incurred in connection with any investigation of site  conditions or any clean-up, and any remedial, removal or restoration work required by  any federal, state or local governmental agency or political subdivision because of the  aforesaid Hazardous Materials present in or on the Premises in violation of Legal  Requirements. Without limiting the foregoing, if the presence of any Hazardous  Materials caused by Landlord, its agents, employees, or contractors or invitees results  in any contamination in violation of Legal Requirements, Landlord shall promptly take  all actions as are necessary to return the Premises to the condition existing prior to the  introduction of any such Hazardous Materials. The indemnity obligations of Landlord  under this Section 33(a) shall survive the expiration or earlier termination of this Lease.  (b) Tenant shall not cause or grant permission for any Hazardous Materials to be brought  upon, kept, stored, utilized, disposed of or used in or about the Premises by Tenant, its  agents, employees, contractors or invitees (except for small amounts of cleaning  supplies used in the ordinary course of business and in compliance with all Legal  Requirements).  If Tenant breaches its obligations under this Section 33, or if the  presence of Hazardous Materials is caused by the acts of Tenant, its agents, employees,  contractors or invitees and results in contamination of the Premises, or if contamination  of the Premises by Hazardous Materials otherwise occurs for which Tenant is legally  liable to Landlord for damage resulting therefrom, then Tenant shall indemnify, defend  and hold Landlord harmless from and against any and all claims, judgments, damages,  penalties, fines, costs, liabilities or losses (including damages for the loss or restriction  on use of rentable or usable space or of any amenity of the Premises, damages arising  from any adverse impact on marketing of space, and sums paid in settlement of claims,  attorneys’ fees and disbursements, consultant fees and expert fees) which arise during  or after the Term as a result of such contamination. The indemnification of Landlord by  Tenant herein includes costs incurred in connection with any investigation of site  conditions or any clean-up, and any remedial, removal or restoration work required by  any federal, state or local governmental agency or political subdivision because of  Hazardous Materials present in or on the Premises by reason of the acts or negligence  by Tenant, its agents, employees, contractors or invitees. Without limiting the  foregoing, if the presence of any Hazardous Materials caused or permitted by Tenant,  its agents, employees, contractors or invitees results in any contamination, Tenant shall  promptly take all actions as are necessary to return the Premises to the condition  

 

{01089783.DOCX.2}   7418 Ranco Road, Richmond, VA 23228  25  17757328v6  existing prior to the introduction of any such Hazardous Materials; provided that  Landlord’s written approval of such actions shall first be obtained. The obligations  Tenant under this Section 33 shall survive the expiration or earlier termination of this  Lease.  (c) As used herein, the term "Hazardous Materials" means any substance or substances  which are (i) defined under any Environmental Law (defined below) as a hazardous  substance, hazardous waste, hazardous material, pollutant or contaminant, (ii) a  petroleum hydrocarbon, including crude oil or any fraction thereof, (iii) hazardous,  toxic, corrosive, flammable, explosive, infectious, radioactive, carcinogenic or a  reproductive toxicant or (iv) otherwise regulated pursuant to any Environmental Law.   The term "Environmental Laws" shall mean all federal, state and local laws, statutes,  ordinances, regulations, rules, judicial and administrative orders and decrees, permits,  licenses, approvals, authorizations and similar requirements of all federal, state and  local governmental agencies or other governmental authorities pertaining to the  protection of human health and safety or the environment now existing or later adopted  during the Term.  Section 34. Miscellaneous.  (a) Tenant represents and warrants that (i) neither Tenant nor any person who owns any  direct or indirect beneficial interest in Tenant or any of them, is listed on the list  maintained by the United States Department of Treasury, Office of Foreign Assets  Control (commonly known as the OFAC List) or otherwise qualifies as a person with  whom business by a United States citizen or resident is prohibited, and (ii) neither  Tenant nor any person who owns any direct or indirect beneficial interest in Tenant or  any of them is in violation of any anti-money laundering or anti-terrorism statute,  including, without limitation, the Uniting and Strengthening America by Providing  Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001, U.S.  Public Law 107-56 (commonly known as the USA Patriot Act), and the related  regulations issued thereunder, including temporary regulations, all as amended from  time to time.  (b) Each party warrants to the other that it has had no dealings with any broker or agent in  connection with this Lease. In the event that either party has had such dealings with  any real estate brokers, attorneys acting as brokers, agents, consultants, or finders  (collectively, "Outside Brokers") in connection with this Lease, such party shall pay  such Outside Brokers and hold harmless and indemnify the other party from and  against any and all costs, expenses or liability for any compensation, commissions and  charges claimed by such Outside Brokers with respect to this Lease or the negotiation  hereof (including the cost of reasonable legal fees in connection therewith). The  obligations of Landlord and Tenant under this Section 34(b) shall survive the  expiration or earlier termination of this Lease.  (c) From time to time, Tenant, within ten (10) business days of the request of Landlord,  shall execute and deliver to Landlord, without charge, a statement, duly acknowledged:   (i) ratifying this Lease; (ii) confirming the Commencement Date and Expiration Date;  (iii) certifying (A) that Tenant is in occupancy of the Premises and the date Tenant  

 

{01089783.DOCX.2}   7418 Ranco Road, Richmond, VA 23228  26  17757328v6  commenced operating Tenant’s business therein (to the extent applicable at the time of  the request for such statement) and (B) that this Lease is in full force and effect and has  not been assigned, modified, supplemented or amended, except by such writings as  shall be stated; (iv) certifying that Landlord has fulfilled all its obligations under this  Lease, except such as shall be stated; (v) certifying that there are no defenses or offsets  against Landlord’s enforcement of this Lease by Landlord, except such as shall be  stated; (vi) reciting the amount of Base Rent and Additional Rent then payable; (vii)  reciting the amount of the Security Deposit; and (viii) certifying as to such other  matters concerning this Lease as may be reasonably required by Landlord or the holder  of a Mortgage.  Tenant shall execute and deliver similar statements, from time to time  as and when requested by Landlord, to Mortgagees and/or purchasers, and each of such  parties shall be entitled to rely upon any such written statement or certification made  by Tenant.  (d) This Lease may be executed in one or more counterparts, any one or all of which shall  constitute but one agreement. Facsimile or PDF signatures or other electronic methods,  such as (without limitation) DocuSign, shall for all purposes hereof be deemed to be  original signatures of the parties hereto.  (e) This Agreement shall be governed by the laws of the jurisdiction in which the Premises  is located, without regard to the application of choice of law principles.   [Signature Page Follows] 

 

{01089783.DOCX.2} 7418 Ranco Road, Richmond, VA 23228  Signature Page  Warehouse Lease Agreement  17757328v6  IN WITNESS WHEREOF, Landlord and Tenant have executed this Lease as of the day and year  first above written.  LANDLORD:  Poiner Realty, LLC  By:______________________________       Name:       Title:  TENANT:  Great Wall Seafood VA, L.L.C.   By:______________________________       Name: Kong Hian Lee a/k/a Victor Lee       Title: Sole Manager  

 

{01089783.DOCX.2} 7418 Ranco Road, Richmond, VA 23228  Exhibit "A"  17757328v6  Exhibit "A"  Legal Description of the Land  

 

{01089783.DOCX.2} 7418 Ranco Road, Richmond, VA 23228  Exhibit "B"  17757328v6  Exhibit "B"  Designated Spaces  To be three parking spaces mutually agreed upon by Landlord and Tenant.Form of Medium-Term Notes Series U

 Exhibit 4.1 

[Face of Note] 
  

			
	CUSIP NO. 95000U2X0	  	PRINCIPAL AMOUNT: $        
	 REGISTERED NO.     
	  	

 WELLS FARGO & COMPANY 

MEDIUM-TERM NOTE, SERIES U 

SENIOR REDEEMABLE FIXED-TO-FLOATING RATE NOTES 

☑    Check this box if this Security is a Global Security. 

Unless this certificate is presented by an authorized representative of The Depository Trust Company, a New York corporation
(“DTC”), to the Issuer or its agent for registration of transfer, exchange or payment, and any certificate issued is registered in the name of Cede & Co. or in such other name as requested by an authorized representative of DTC
(and any payment is made to Cede & Co. or such other entity as is requested by an authorized representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered
owner hereof, Cede & Co., has an interest herein. 
 This Security is not a deposit or other obligation of a
depository institution and is not insured by the Federal Deposit Insurance Corporation, the Deposit Insurance Fund or any other governmental agency. 

					
	 ORIGINAL ISSUE DATE: April 25, 2022
	  		  	 STATED MATURITY DATE: April 25, 2026

			
	 FIXED RATE PERIOD: From April 25, 2022 to, but excluding, April 25, 2025
	  	 FLOATING RATE PERIOD: If this Security has not been previously redeemed, from, and including, April 25, 2025 to, but
excluding, Maturity
	  	 INTEREST RATE PER ANNUM: Fixed Rate Period: 3.908%

Floating Rate Period: Base Rate plus the Spread, subject to the Minimum Interest Rate and to modification as provided on the reverse hereof
under the section entitled “Determination of Interest Rate for the Floating Rate Period”

			
	 INITIAL INTEREST RATE: 3.908%
	  	 FIXED RATE INTEREST PAYMENT DATES: Each April 25 and October 25, commencing October 25, 2022 and ending
April 25, 2025
	  	 INITIAL FIXED RATE INTEREST PAYMENT DATE: October 25, 2022

			
	 INITIAL INTEREST RATE FOR THE FLOATING RATE PERIOD: Compounded SOFR plus 1.32%, subject to the Minimum Interest Rate and to
modification as provided on the reverse hereof under the section entitled “Determination of Interest Rate for the Floating Rate Period”
	  	 FLOATING RATE INTEREST PAYMENT DATES: Each January 25, April 25, July 25 and October 25, commencing
July 25, 2025, and at Maturity
	  	 INITIAL FLOATING RATE INTEREST PAYMENT DATE: July 25, 2025

			
	 BASE RATE: Compounded SOFR, as defined and subject to modification as provided on the reverse hereof under the sections
entitled “Determination of Compounded SOFR” and “Determination of Interest Rate for the Floating Rate Period”
	  		  	 SPREAD: +132 basis points

			
	 INTEREST PERIOD WITH RESPECT TO AN INTEREST PAYMENT DATE DURING THE FLOATING RATE PERIOD: The period from, and including,
the immediately preceding Interest Payment Date (or, in the case of the first Interest Period during the Floating Rate Period, April 25, 2025) to, but excluding, that Interest Payment Date
	  	 OBSERVATION PERIOD IN RESPECT OF EACH INTEREST PERIOD DURING THE FLOATING RATE PERIOD: The period from, and including, the
date two U.S. Government Securities Business Days preceding the first date in such Interest Period to, but excluding, the date two U.S. Government Securities Business Days preceding the Interest Payment Date for such Interest Period
	  	 MINIMUM INTEREST RATE FOR AN INTEREST PERIOD: 0% per annum

			
	 REGULAR RECORD DATES: The fifteenth calendar day, whether or not a Business Day, prior to an Interest Payment Date
	  		  	CALCULATION AGENT: The Calculation Agent will be appointed prior to April 25, 2025
			
	 INDEX CURRENCY: U.S. Dollars
	  	 OPTIONAL REDEMPTION (at option of Company): Yes
	  	REDEMPTION PRICE: See “Redemption” on the reverse hereof
			
	 REDEMPTION DATE(S)

(at option of Company): See “Redemption” on the reverse hereof
	  	 OPTION TO ELECT REPAYMENT: N/A
	  	 REPAYMENT PRICE: N/A

☐    100%

☐    Other

			
	 OPTIONAL REPAYMENT DATE(S): N/A
	  	 SINKING FUND: N/A
	  	 DEPOSITARY
 (Only
applicable if this Security is a Global Security): The Depository Trust Company

			
	 SPECIFIED CURRENCY: U.S. Dollars
	  	 MINIMUM DENOMINATIONS:

☑    U.S. $1,000

☐    Other
	  	 OTHER/ADDITIONAL TERMS: References herein to “Interest Payment Dates” shall mean the Fixed Rate Interest Payment
Dates and the Floating Rate Interest Payment Dates

			
	 ADDENDUM ATTACHED: No
	  		  	

  
 2 

 WELLS FARGO & COMPANY, a corporation duly organized and existing
under the laws of the State of Delaware (hereinafter called the “Company,” which term includes any successor corporation under the Indenture hereinafter referred to), for value received, hereby promises to pay to CEDE & Co., or
registered assigns, the principal sum of                      DOLLARS ($        ) on the Stated
Maturity Date shown above (except to the extent redeemed prior to such date) and to pay interest, if any, on the principal amount hereof, (i) from the Original Issue Date specified above or from the most recent Fixed Rate Interest Payment Date
to which interest has been paid or duly provided for to, but excluding, April 25, 2025 at the rate per annum of 3.908% on the Fixed Rate Interest Payment Dates specified above, and (ii) if this Security has not been previously redeemed,
from, and including April 25, 2025 or from the most recent Floating Rate Interest Payment Date to which interest has been paid or duly provided for to, but excluding, the date of Maturity on the Floating Rate Interest Payment Dates specified
above at the Base Rate plus the Spread specified above, subject to the Minimum Interest Rate and as determined by the Calculation Agent in accordance with the provisions on the reverse hereof under the headings “Determination of Compounded
SOFR” and “Determination of Interest Rate for the Floating Rate Period,” as applicable. The interest so payable, and punctually paid or duly provided for, on any Interest Payment Date will, as provided in the Indenture, be paid to the
Person in whose name this Security (or one or more Predecessor Securities) is registered at the close of business on the Regular Record Date next preceding such Interest Payment Date. Interest payable upon Maturity will be paid to the Person to whom
principal is payable. 
 If a Fixed Rate Interest Payment Date is not a Business Day, interest on this Security shall be
payable on the next day that is a Business Day, with the same force and effect as if made on such Fixed Rate Interest Payment Date, and without any interest or other payment with respect to the delay. If a Floating Rate Interest Payment Date falls
on a day that is not a Business Day, other than a Floating Rate Interest Payment Date that is also the date of Maturity, such Floating Rate Interest Payment Date will be postponed to the following day that is a Business Day, except that, if such
following Business Day is in the next calendar month, such Floating Rate Interest Payment Date shall be the immediately preceding day that is a Business Day. If the date of Maturity would fall on a day that is not a Business Day, the payment of
principal and interest shall be made on the next Business Day, with the same force and effect as if made on the due date, and no additional interest shall accrue on the amount so payable for the period from and after such date of Maturity. For
purposes of this Security, “Business Day” means any day, other than a Saturday or Sunday, that is neither a legal holiday nor a day on which banking institutions are authorized or required by law or regulation to close in New York, New
York and, for a Floating Rate Interest Payment Date and any date of Maturity during the period from, and including, March 25, 2026 to, but excluding, the Stated Maturity Date, a day that is also a U.S. Government Securities Business Day. For
purposes of this Security, “U.S. Government Securities Business Day” means any day other than a Saturday, a Sunday or a day on which the Securities Industry and Financial Markets Association recommends that the fixed income departments of
its members be closed for the entire day for purposes of trading in U.S. government securities. 
 Interest payments on this
Security shall be the amount of interest accrued from and including the Original Issue Date specified above or from and including the last date to which interest has been paid, or provided for, as the case may be, to but excluding, the following
Interest Payment Date or the date of Maturity. If this Security has been issued upon transfer of, in exchange for, or in replacement of, a Predecessor Security, interest on this Security shall accrue from the last

  
 3 

 
Interest Payment Date to which interest was paid on such Predecessor Security or, if no interest was paid on such Predecessor Security, from the Original Issue Date specified above. The first
payment of interest on a Security originally issued and dated between a Regular Record Date specified above and an Interest Payment Date will be due and payable on the Interest Payment Date following the next succeeding Regular Record Date to the
registered owner on such next succeeding Regular Record Date. 
 The principal and interest on this Security is payable by
the Company in the Specified Currency specified above. 
 Any interest not punctually paid or duly provided for will
forthwith cease to be payable to the Holder on such Regular Record Date and may either be paid to the Person in whose name this Security (or one or more Predecessor Securities) is registered at the close of business on a Special Record Date for the
payment of such Defaulted Interest to be fixed by the Trustee, notice whereof shall be given to Holders of Securities of this series not less than 10 days prior to such Special Record Date, or be paid at any time in any other lawful manner not
inconsistent with the requirements of any securities exchange on which the Securities of this series may be listed, and upon such notice as may be required by such exchange, all as more fully provided in the Indenture. 

Payment of interest on this Security, other than payments of interest at Maturity, will be paid by check mailed to the Person
entitled thereto at such Person’s last address as it appears in the Security Register or by wire transfer to such account as may have been designated by such Person. Any such designation for wire transfer purposes shall be made by providing
written notice to the Paying Agent not later than 10 calendar days prior to the applicable Interest Payment Date. Payment of principal of and interest on this Security at Maturity will be made against presentation of this Security at the office or
agency of the Company maintained for that purpose in the City of Minneapolis, Minnesota, or such other place or places as the Company may designate from time to time. Notwithstanding the foregoing, for so long as this Security is a Global Security
registered in the name of the Depositary, payments of principal and interest on this Security will be made to the Depositary by wire transfer of immediately available funds. 

The Company will pay any administrative costs imposed by banks on payors in making payments on this Security in immediately
available funds and the Holder of this Security will pay any administrative costs imposed by banks on payees in connection with such payments. Any tax, assessment or governmental charge imposed upon payments on this Security will be borne by the
Holder of this Security. 
 Reference is hereby made to the further provisions of this Security set forth on the reverse
hereof, which further provisions shall for all purposes have the same effect as if set forth at this place. 
 Unless the
certificate of authentication hereon has been executed by the Trustee referred to on the reverse hereof by manual signature or its duly authorized agent under the Indenture referred to on the reverse hereof by manual signature, this Security shall
not be entitled to any benefit under the Indenture or be valid or obligatory for any purpose. 
 [The remainder of this page has been
intentionally left blank.] 

  
 4 

 IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed. 
 DATED:
                     
  

	
	 WELLS FARGO & COMPANY

	
	By:                                     
                                       
	Name:
	Its:
	
	Attest:                                     
                                   
	Name:
	Its:

 TRUSTEE’S CERTIFICATE OF AUTHENTICATION 

This is one of the Securities of the 

series designated therein referred to 

in the within-mentioned Indenture. 

 

	
	CITIBANK, N.A.,
      as Trustee
	
	By:                                     
                                         
                   
	       Authorized Signature

 OR 
  

					
	 WELLS FARGO BANK, NATIONAL ASSOCIATION

            as Authenticating Agent for the Trustee

		
	By:	 	Computershare Trust Company, N.A., as agent and attorney-in-fact

 

					
		 	By:	 	                                      
                                         
                 
		 		 	Name:                                     
                                         
       
		 		 	Title:                                     
                                         
         

  
 5 

 [Reverse of Note] 

WELLS FARGO & COMPANY 

MEDIUM-TERM NOTE, SERIES U 

SENIOR REDEEMABLE FIXED-TO-FLOATING RATE NOTES 

General 

This Security is one of a duly authorized issue of securities of the Company (herein called the “Securities”),
issued and to be issued in one or more series under an indenture dated as of February 21, 2017, as amended or supplemented from time to time (herein called the “Indenture”), between the Company and Citibank, N.A., as Trustee (herein
called the “Trustee,” which term includes any successor trustee under the Indenture), to which Indenture and all indentures supplemental thereto, reference is hereby made for a statement of the respective rights, limitations of rights,
duties and immunities thereunder of the Company, the Trustee and the Holders of the Securities, and of the terms upon which the Securities are, and are to be, authenticated and delivered. This Security is one of the series of the Securities
designated as Medium-Term Notes, Series U, of the Company. The Securities of this series may mature at different times, bear interest, if any, at different rates, be redeemable at different times or not at all, be repayable at the option of the
Holder at different times or not at all, be issued at an original issue discount and be denominated in different currencies. 

The Securities are issuable only in registered form without coupons and will be
book-entry securities represented by one or more global securities recorded in the book-entry system maintained by the Depositary (“Global Securities”). 

Interest Rate 

The interest rate in effect for the Fixed Rate Period shall be the Initial Interest Rate specified on the face hereof. The
interest rate in effect for the Floating Rate Period shall be the Base Rate plus the Spread specified on the face hereof, subject to the Minimum Interest Rate identified on the face hereof and to modification as provided herein. 

The amount of interest to be paid on this Security for each Interest Period occurring during the Fixed Rate Period shall be
computed on the basis of a 360-day year of twelve 30-day months. 

The amount of interest to be paid on this Security for each Interest Period occurring during the Floating Rate Period will be
equal to the product of (i) the outstanding principal amount of this Security multiplied by (ii) the product of (a) the Base Rate for the relevant Interest Period plus the Spread multiplied by (b) the quotient of the actual
number of calendar days in such Interest Period divided by 360, subject to the Minimum Interest Rate identified on the face hereof. 

All U.S. dollar amounts used in or resulting from any of the calculations referred to herein will be rounded, if necessary, to
the nearest cent, with one-half cent rounded upward. All U.S. 

  
 6 

 
Dollar amounts used in or resulting from these calculations will be rounded to the nearest two decimal places, with 0.005 round up to 0.01. 

The Calculation Agent will determine the Base Rate specified on the face hereof, the interest rate and the amount of interest
payable for each Interest Period during the Floating Rate Period in arrears as soon as reasonably practicable on or after the last day of the applicable Observation Period, and in any event on or prior to the Business Day immediately preceding the
relevant Interest Payment Date, and will notify the Company of the Base Rate and such interest rate and the amount of interest payable for each Interest Period during the Floating Rate Period as soon as reasonably practicable after such
determination, but in any event by the Business Day immediately prior to the Interest Payment Date. For the avoidance of doubt, all determinations referenced in this paragraph shall be subject to the Minimum Interest Rate identified on the face
hereof and to modification as provided herein. 
 The interest rate on this Security shall in no event be higher than the
maximum rate permitted by New York law, as the same may be modified by United States law of general application. 
  

	Determination	 of Compounded SOFR 

“Compounded SOFR” (a compounded average of daily SOFR), calculated in accordance with the formula set forth below,
with the resulting percentage being rounded, if necessary, to the nearest one hundred-thousandth of a percentage point (0.000005 being rounded upwards to 0.00001): 
  

 
 where for purposes of applying the above formula to the terms of this Security: 

“d0”, for any Observation Period, is the number of U.S. Government Securities Business Days in the relevant
Observation Period; 
 “i” is a series of whole numbers from one to d0, each representing the relevant U.S.
Government Securities Business Days in chronological order from, and including, the first U.S. Government Securities Business Day in the relevant Observation Period; 

“SOFRi”, for any U.S. Government Securities Business Day “i” in the relevant Observation
Period, is equal to SOFR (as defined below under the section entitled “Determination of Interest Rate for the Floating Rate Period”) in respect of that day; 

“ni”, for any U.S. Government Securities Business Day “i” in the relevant Observation
Period, is the number of calendar days from, and including, such U.S. Government Securities Business Day “i” to, but excluding, the following U.S. Government Securities Business Day (“i+1”); and 

  
 7 

 “d” is the number of calendar days in the relevant Observation
Period. 
 Determination of Interest Rate for the Floating Rate Period 

This Security will bear interest for each Interest Period during the Floating Rate Period at a per annum rate equal to
Compounded SOFR plus the Spread, subject to the Minimum Interest Rate and the other terms described on the face hereof. Compounded SOFR will be determined by the Company or its designee using the formula described under the section entitled
“Determination of Compounded SOFR.” References in this section entitled “Determination of Interest Rate for the Floating Rate Period” to “its designee” refer to the Calculation Agent to be appointed by the Company. SOFR
will be determined by the Company or its designee in the following manner: 
 “SOFR” means, with respect to any
U.S. Government Securities Business Day: 
 (1) the Secured Overnight Financing Rate published for such U.S. Government
Securities Business Day as such rate appears on the SOFR Administrator’s Website at 3:00 p.m. (New York time) on the immediately following U.S. Government Securities Business Day (the “SOFR Determination Time”); 

(2) if the rate specified in (1) above does not so appear, the Secured Overnight Financing Rate as published in respect
of the first preceding U.S. Government Securities Business Day for which the Secured Overnight Financing Rate was published on the SOFR Administrator’s Website; 

where: 

“SOFR Administrator” means the Federal Reserve Bank of New York (or a successor administrator of the Secured
Overnight Financing Rate); and 
 “SOFR Administrator’s Website” means the website of the Federal Reserve
Bank of New York, or any successor source. 
 Notwithstanding the foregoing, if the Company or its designee determines that
a Benchmark Transition Event and its related Benchmark Replacement Date have occurred prior to the Reference Time in respect of any determination of the then-current Benchmark on any date for the Floating Rate Period, the Benchmark Replacement will
replace the then-current Benchmark for all purposes relating to this Security in respect of such determination on such date and all determinations on all subsequent dates. 

In connection with the implementation of a Benchmark Replacement, the Company or its designee will have the right to make
Benchmark Replacement Conforming Changes from time to time. 
 Any determination, decision, election or calculation that may
be made by the Company or its designee pursuant to the provisions described in this section “Determination of Interest Rate for the Floating Rate Period,” including any determination with respect to a rate or adjustment or of the
occurrence or non-occurrence of an event, circumstance or date and any decision to take or refrain from taking any action or any selection, will be conclusive and binding absent manifest

  
 8 

 
error, may be made in the Company’s or its designee’s sole discretion, and, notwithstanding anything to the contrary in the documentation relating to this Security, shall become
effective without consent from any other party. 
 For the avoidance of doubt, after a Benchmark Transition Event and its
related Benchmark Replacement Date have occurred, interest payable on this Security for the Floating Rate Period will be an annual rate equal to the sum of the applicable Benchmark Replacement and the Spread set forth on the face hereof. 

Upon the request of the Holder of this Security, the Company or its designee will provide the calculation of the amount of
interest payable in respect of any Interest Payment Date during the Floating Rate Period. 
 As used herein: 

“Benchmark” means, initially, Compounded SOFR, as defined under the section entitled “Determination of
Compounded SOFR”; provided that if a Benchmark Transition Event and its related Benchmark Replacement Date have occurred with respect to Compounded SOFR (or the published daily SOFR used in the calculation thereof) or the then-current
Benchmark, then “Benchmark” means the applicable Benchmark Replacement. 
 “Benchmark Replacement” means
the first alternative set forth in the order below that can be determined by the Company or its designee for the applicable Benchmark Replacement Date: 

(1)    the sum of: (a) the alternate rate of interest that has been selected or recommended by the
Relevant Governmental Body as the replacement for the then-current Benchmark and (b) the Benchmark Replacement Adjustment; 

(2)    the sum of: (a) the ISDA Fallback Rate and (b) the Benchmark Replacement Adjustment; 

(3)    the sum of: (a) the alternate rate of interest that has been selected by the Company or its
designee as the replacement for the then-current Benchmark giving due consideration to any industry-accepted rate of interest as a replacement for the then-current Benchmark for U.S. dollar-denominated floating rate notes at such time and
(b) the Benchmark Replacement Adjustment. 
 “Benchmark Replacement Adjustment” means the first alternative
set forth in the order below that can be determined by the Company or its designee for the applicable Benchmark Replacement Date: 

(1)    the spread adjustment, or method for calculating or determining such spread adjustment, (which may
be a positive or negative value or zero), that has been selected or recommended by the Relevant Governmental Body for the applicable Unadjusted Benchmark Replacement; 

(2)    if the applicable Unadjusted Benchmark Replacement is equivalent to the ISDA Fallback Rate, then
the ISDA Fallback Adjustment; 

  
 9 

 (3)    the spread adjustment (which may be a positive or
negative value or zero) that has been selected by the Company or its designee giving due consideration to any industry-accepted spread adjustment, or method for calculating or determining such spread adjustment, for the replacement of the
then-current Benchmark with the applicable Unadjusted Benchmark Replacement for U.S. dollar-denominated floating rate notes at such time. 

For the avoidance of doubt, the Benchmark Replacement Adjustment for the applicable Benchmark Replacement Date may be
selected, recommended or determined on a day other than such Benchmark Replacement Date. 
 “Benchmark Replacement
Conforming Changes” means, with respect to any Benchmark Replacement, any technical, administrative or operational changes (including changes to the definitions of “Interest Period” and “Observation Period”, timing and
frequency of determining rates and making payments of interest, rounding of amounts or tenors, and other administrative matters) that the Company or its designee decides may be appropriate to reflect the adoption of such Benchmark Replacement in a
manner substantially consistent with market practice (or, if the Company or its designee decides that adoption of any portion of such market practice is not administratively feasible or if the Company or its designee determines that no market
practice for use of the Benchmark Replacement exists, in such other manner as the Company or its designee determines is reasonably necessary). 

“Benchmark Replacement Date” means the earliest to occur of the following events with respect to the then-current
Benchmark (including the daily published component used in the calculation thereof): 
 (1)    in the
case of clause (1) or (2) of the definition of “Benchmark Transition Event,” the later of (a) the date of the public statement or publication of information referenced therein and (b) the date on which the administrator of
the Benchmark permanently or indefinitely ceases to provide the Benchmark (or such component); or 

(2)    in the case of clause (3) of the definition of “Benchmark Transition Event,” the
first date on which such Benchmark (or such component) is no longer representative based on the determination and announcement by the regulatory supervisor for the administrator of such Benchmark (or such component); provided, that such non-representativeness will be determined by reference to the most recent statement or publication referenced in such clause (3) and even if such Benchmark (or such component) continues to be provided on such
date. For avoidance of doubt, the Benchmark Replacement Date could occur some period of time after the most recent statement or publication referenced in clause (3) of the definition of “Benchmark Transition Event.” 

For the avoidance of doubt, if the event giving rise to the Benchmark Replacement Date occurs on the same day as, but earlier
than, the Reference Time in respect of any determination, the Benchmark Replacement Date will be deemed to have occurred prior to the Reference Time for such determination. 

  
 10 

 “Benchmark Transition Event” means the occurrence of one or more
of the following events with respect to the then-current Benchmark (including the daily published component used in the calculation thereof): 

(1)    a public statement or publication of information by or on behalf of the administrator of the
Benchmark (or such component) announcing that such administrator has ceased or will cease to provide the Benchmark (or such component), permanently or indefinitely, provided that, at the time of such statement or publication, there is no successor
administrator that will continue to provide the Benchmark (or such component); 
 (2)    a public
statement or publication of information by the regulatory supervisor for the administrator of the Benchmark (or such component), the central bank for the currency of the Benchmark (or such component), an insolvency official with jurisdiction over
the administrator for the Benchmark (or such component), a resolution authority with jurisdiction over the administrator for the Benchmark (or such component) or a court or an entity with similar insolvency or resolution authority over the
administrator for the Benchmark (or such component), which states that the administrator of the Benchmark (or such component) has ceased or will cease to provide the Benchmark (or such component) permanently or indefinitely, provided that, at the
time of such statement or publication, there is no successor administrator that will continue to provide the Benchmark (or such component); or 

(3)    a public statement or publication of information by the regulatory supervisor for the administrator
of the Benchmark (or such component) announcing that the Benchmark (or such component) is no longer, or as of a specified future date will no longer be, representative. 

“ISDA Definitions” means the 2006 ISDA Definitions published by the International Swaps and Derivatives Association,
Inc. (“ISDA”) or any successor thereto, as amended or supplemented from time to time, or any successor definitional booklet for interest rate derivatives published from time to time. 

“ISDA Fallback Adjustment” means the spread adjustment (which may be a positive or negative value or zero) that
would apply for derivatives transactions referencing the ISDA Definitions to be determined upon the occurrence of an index cessation event with respect to the Benchmark for the applicable tenor. 

“ISDA Fallback Rate” means the rate that would apply for derivatives transactions referencing the ISDA Definitions
to be effective upon the occurrence of an index cessation date with respect to the Benchmark for the applicable tenor excluding the applicable ISDA Fallback Adjustment. 

“Reference Time” with respect to any determination of the Benchmark means (1) if the Benchmark is Compounded
SOFR, the SOFR Determination Time, and (2) if the Benchmark is not Compounded SOFR, the time determined by the Company or its designee in accordance with the Benchmark Replacement Conforming Changes. 

  
 11 

 “Relevant Governmental Body” means the Federal Reserve Board
and/or the Federal Reserve Bank of New York, or a committee officially endorsed or convened by the Federal Reserve Board and/or the Federal Reserve Bank of New York or any successor thereto. 

“Unadjusted Benchmark Replacement” means the Benchmark Replacement excluding the Benchmark Replacement Adjustment.

 Events of Default 

If an Event of Default, as defined in the Indenture, with respect to Securities of this series shall occur and be continuing,
the principal of the Securities of this series may be declared due and payable in the manner and with the effect provided in the Indenture. 

Modification and Waivers 

The Indenture permits, with certain exceptions as therein provided, the amendment thereof and the modification of the rights
and obligations of the Company and the rights of the Holders of the Securities of each series to be affected under the Indenture at any time by the Company and the Trustee with the consent of the Holders of a majority in principal amount of the
Securities at the time Outstanding of all series to be affected, acting together as a class; provided, however, that amendments or modifications to this Security contemplated by the provisions set forth in the section entitled “Determination of
Interest Rate for the Floating Rate Period” shall not require the consent of the Holder of this Security. The Indenture also contains provisions permitting the Holders of a majority in principal amount of the Securities of all series at the
time Outstanding affected by certain provisions of the Indenture, acting together as a class, on behalf of the Holders of all Securities of such series, to waive compliance by the Company with those provisions of the Indenture. Certain past defaults
under the Indenture and their consequences may be waived under the Indenture by the Holders of a majority in principal amount of the Securities of each series at the time Outstanding, on behalf of the Holders of all Securities of such series. Any
such consent or waiver by the Holder of this Security shall be conclusive and binding upon such Holder and upon all future Holders of this Security and of any Security issued upon the registration of transfer hereof or in exchange herefor or in lieu
hereof, whether or not notation of such consent or waiver is made upon this Security. 
 Defeasance and Covenant Defeasance 

The Indenture contains provisions for defeasance at any time of (a) the entire indebtedness on this Security and
(b) certain restrictive covenants, upon compliance by the Company with certain conditions set forth therein, which provisions apply to this Security. 

Redemption 

This Security is redeemable at the option of the Company. The Company may redeem this Security, (i) in whole, but not in
part, on April 25, 2025 (the “First Par Call Date”) or (ii) in whole at any time or in part from time to time, on or after March 25, 2026, in each case at a Redemption Price equal to 100% of the principal amount of this
Security being redeemed plus accrued and unpaid interest thereon to, but excluding, the date of such redemption. 

  
 12 

 This Security is also redeemable at the option of the Company, in whole at
any time or in part from time to time, on any day included in the Make-Whole Redemption Period (as defined below), at a Redemption Price equal to the greater of: (i) the Make-Whole Amount (as defined below) and (ii) 100% of the principal amount
of this Security being redeemed, plus in either case, accrued and unpaid interest on this Security or the portion thereof to be redeemed to, but excluding, the date of such redemption. 

As used in this Security: 

The “Make-Whole Amount” is (i) the sum of the present values of the remaining scheduled payments of principal
and interest thereon discounted to the date of such redemption (assuming this Security matured on the First Par Call Date) on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) at the Treasury Rate (as defined below) plus the Make-Whole Spread (as defined below) less (ii) interest accrued to the date of such redemption. 

The “Make-Whole Redemption Period” is the period commencing on and including May 2, 2023 and ending on and
including April 24, 2025. 
 The “Make-Whole Spread” is 0.20%. 

“Treasury Rate” means, with respect to any Redemption Date, the yield determined by the Company in accordance with
the following two paragraphs. 
 The Treasury Rate shall be determined by the Company after 4:15 p.m., New York City time
(or after such time as yields on U.S. government securities are posted daily by the Board of Governors of the Federal Reserve Board (the “FRB”), on the third Business Day preceding the Redemption Date based upon the yield or yields for the
most recent day that appear after such time on such day in the most recent statistical release published by the FRB designated as “Selected Interest Rates (Daily) - H.15” (or any successor designation or publication) (“H.15”)
under the caption “U.S. government securities—Treasury constant maturities—Nominal” (or any successor caption or heading) (“H.15 TCM”). In determining the Treasury Rate, the Company shall select, as applicable:
(1) the yield for the Treasury constant maturity on H.15 exactly equal to the period from the Redemption Date to the First Par Call Date (the “Remaining Life”); or (2) if there is no such Treasury constant maturity on H.15
exactly equal to the Remaining Life, the two yields—one yield corresponding to the Treasury constant maturity on H.15 immediately shorter than and one yield corresponding to the Treasury constant maturity on H.15 immediately longer than the
Remaining Life—and shall interpolate to the First Par Call Date on a straight-line basis (using the actual number of days) using such yields and rounding the result to three decimal places; or (3) if there is no such Treasury constant
maturity on H.15 shorter than or longer than the Remaining Life, the yield for the single Treasury constant maturity on H.15 closest to the Remaining Life. For purposes of this paragraph, the applicable Treasury constant maturity or maturities on
H.15 shall be deemed to have a maturity date equal to the relevant number of months or years, as applicable, of such Treasury constant maturity from the Redemption Date. 

If on the third Business Day preceding the Redemption Date H.15 TCM (or any successor designation or publication) is no longer
published, the Company shall calculate the Treasury Rate based on the rate per annum equal to the semi-annual equivalent yield to maturity at 11:00 a.m., 

  
 13 

 
New York City time, on the second Business Day preceding such Redemption Date of the United States Treasury security maturing on, or with a maturity that is closest to, the First Par Call Date,
as applicable. If there is no United States Treasury security maturing on the First Par Call Date but there are two or more United States Treasury securities with a maturity date equally distant from the First Par Call Date, one with a maturity date
preceding the First Par Call Date and one with a maturity date following the First Par Call Date, the Company shall select the United States Treasury security with a maturity date preceding the First Par Call Date. If there are two or more United
States Treasury securities maturing on the First Par Call Date or two or more United States Treasury securities meeting the criteria of the preceding sentence, the Company shall select from among these two or more United States Treasury securities
the United States Treasury security that is trading closest to par based upon the average of the bid and asked prices for such United States Treasury securities at 11:00 a.m., New York City time. In determining the Treasury Rate in accordance with
the terms of this paragraph, the semi-annual yield to maturity of the applicable United States Treasury security shall be based upon the average of the bid and asked prices (expressed as a percentage of principal amount) at 11:00 a.m., New York City
time, of such United States Treasury security, and rounded to three decimal places. 
 Any Redemption Price will be
expressed as a percentage of principal amount and rounded to three decimal places. 
 The Company may exercise its options
to redeem this Security by mailing a notice by first-class mail, postage prepaid, of such redemption to each Holder of the Securities of this series to be redeemed or, in the case of Global Securities, the Company shall provide such notice to the
Depositary, as holder of the Global Securities pursuant to the applicable procedures of such Depositary, at least 15 days and not more than 60 days prior to the applicable Redemption Date. Unless the Company defaults in the payment of the
Redemption Price, on and after the applicable Redemption Date interest will cease to accrue on this Security or portion hereof called for redemption. 

Repayment 

This Security will not be repayable prior to the Stated Maturity Date at the option of the Holder. 

Sinking Fund 

This Security will not be entitled to any sinking fund. 

Authorized Denominations 

This Security is issuable only in registered form without coupons in denominations of $1,000 and integral multiples of $1,000
in excess thereof and cannot be exchanged for debt securities of the Company in smaller denominations. Beneficial interests in this Security will only be held in denominations of $1,000 and integral multiples of $1,000 in excess thereof. 

  
 14 

 Registration of Transfer 

Upon due presentment for registration of transfer of this Security at the office or agency of the Company in the City of
Minneapolis, Minnesota (or such other place or places as the Company may designate from time to time), a new Security or Securities of this series in authorized denominations for an equal aggregate principal amount will be issued to the transferee
in exchange herefor, as provided in the Indenture and subject to the limitations provided therein and to the limitations described below, without charge except for any tax or other governmental charge imposed in connection therewith. 

This Security is exchangeable for definitive Securities in registered form only if (x) the Depositary notifies the
Company that it is unwilling or unable to continue as Depositary for this Security or if at any time the Depositary ceases to be a clearing agency registered under the Securities Exchange Act of 1934, as amended, and a qualified successor depositary
is not appointed within 90 days after the Company receives such notice or becomes aware of such ineligibility, (y) the Company in its sole discretion determines that this Security shall be exchangeable for definitive Securities in
registered form or elects to terminate the book-entry system through the Depositary and notifies the Trustee thereof or (z) an Event of Default with respect to the Securities represented hereby has occurred and is continuing. If this Security
is exchangeable pursuant to the preceding sentence, it shall be exchangeable for definitive Securities in registered form, bearing interest at the same rate, having the same date of issuance, redemption provisions, Stated Maturity Date and other
terms and of authorized denominations aggregating a like amount. 
 This Security may not be transferred except as a whole
by the Depositary to a nominee of the Depositary or by a nominee of the Depositary to the Depositary or another nominee of the Depositary or by the Depositary or any such nominee to a successor of the Depositary or a nominee of such successor.
Except as provided above, owners of beneficial interests in this Global Security will not be entitled to receive physical delivery of Securities in definitive form and will not be considered the Holders hereof for any purpose under the Indenture.

 Prior to due presentment of this Security for registration of transfer, the Company, the Trustee and any agent of the
Company or the Trustee may treat the Person in whose name this Security is registered as the owner hereof for all purposes, whether or not this Security be overdue, and neither the Company, the Trustee nor any such agent shall be affected by notice
to the contrary. 
 Obligation of the Company Absolute 

No reference herein to the Indenture and no provision of this Security or the Indenture shall alter or impair the obligation
of the Company, which is absolute and unconditional, to pay the principal of and interest on this Security at the times, place and rate, and in the coin or currency, herein prescribed, except as otherwise provided in this Security and except that in
the event the Company deposits money or Eligible Instruments as provided in Articles 4 and 15 of the Indenture, such payments will be made only from proceeds of such money or Eligible Instruments. 

  
 15 

 No Personal Recourse 

No recourse shall be had for the payment of the principal of or the interest on this Security, or for any claim based hereon,
or otherwise in respect hereof, or based on or in respect of the Indenture or any indenture supplemental thereto, against any incorporator, stockholder, officer or director, as such, past, present or future, of the Company or any successor
corporation, whether by virtue of any constitution, statute or rule of law, or by the enforcement of any assessment or penalty or otherwise, all such liability being, by the acceptance hereof and as part of the consideration for the issuance hereof,
expressly waived and released. 
 Notices 

All notices to the Company under this Security shall be in writing and addressed to Wells Fargo & Company, 550 South
4th Street, 6th Floor, MAC N9310-060, Minneapolis, Minnesota 55415, Attention: Treasury Department, or to such other address as the Company may notify to the Holder. All notices to the Paying Agent under this
Security shall be in writing and addressed to Computershare Trust Company, N.A., c/o Wells Fargo Bank, N.A., Corporate Trust Services, Attn: David Pickett, 600 South 4th Street, 6th Floor, MAC: N9300-060,
Minneapolis, Minnesota 55415, or to such other address as the Company may notify to the Holder. 
 Defined Terms 

All terms used in this Security which are defined in the Indenture shall have the meanings assigned to them in the Indenture
unless otherwise defined in this Security. 
 Governing Law 

This Security shall be governed by and construed in accordance with the law of the State of New York, without regard to
principles of conflicts of laws. 

  
 16 

 ABBREVIATIONS 

The following abbreviations, when used in the inscription on the face of this instrument, shall be construed as though they
were written out in full according to applicable laws or regulations: 
  

					
	 TEN COM
	 	 --
	  	as tenants in common
			
	 TEN ENT
	 	 --
	  	as tenants by the entireties
			
	 JT TEN
	 	 --
	  	as joint tenants with right
of survivorship and not
as tenants in common

  

							
	 UNIF GIFT MIN ACT --
	 	  
	 	 Custodian
	 	  

		 	(Cust)	 		 	(Minor)

  

	
	 Under Uniform Gifts to Minors Act

	
	
                       
                                   

	 (State)

 Additional abbreviations may also be used though not in the above list. 

FOR VALUE RECEIVED, the undersigned hereby sell(s) and transfer(s) unto 

 

	
	 Please Insert Social Security or

Other Identifying Number of Assignee

	 

                       
                                 

  
  

 
  
  

 
 (PLEASE
PRINT OR TYPE NAME AND ADDRESS INCLUDING POSTAL ZIP CODE OF ASSIGNEE)

  
 17 

 the within Security of WELLS FARGO & COMPANY and does hereby irrevocably constitute
and appoint                      attorney to transfer the said Security on the books of the Company, with full power of substitution in the
premises. 
 Dated:
                     
  

	
	
	                             
           
	

 NOTICE: The signature to this assignment must correspond with the name as written upon the face of the
within instrument in every particular, without alteration or enlargement or any change whatever. 

  
 18

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