Document:

urov-ex1022_123.htm

Exhibit 10.22

 

EXECUTIVE EMPLOYMENT AGREEMENT

This Executive Employment Agreement (the “Agreement”), is hereby made between Urovant Sciences, Inc. (the “Company”) and C. Walt Johnston (“you”) (collectively, the “Parties”). This Agreement shall become effective on June 1, 2020 (the “Effective Date”).

Whereas, the Company desires for you to continue to provide services to the Company, and wishes to provide you with certain compensation and benefits in return for such employment services; and

Whereas, you wish to remain employed by the Company and to provide personal services to the Company in return for certain compensation and benefits; 

Now, Therefore, in consideration of the mutual promises and covenants contained herein and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Parties hereto agree as follows:

1.Employment by the Company.

1.1Position.  You will continue to serve as the Company’s SVP, Commercial.  This is an exempt position, based in Illinois with the option to relocate to the Irvine, California area. During your employment with the Company you will devote your best efforts and substantially all of your business time and attention to the business of the Company, except for approved vacation periods and absences permitted by the Company’s general employment policies.  

1.2Duties and Location.  You shall perform such duties as are required by the Company’s CEO (the “CEO”), to whom you will report.  Your primary office location shall be home based in Illinois..  The Company reserves the right to reasonably require you to perform your duties at places other than your primary office location from time to time, and to require reasonable business travel.  

1.3Policies and Procedures.  The employment relationship between the Parties shall be governed by the general employment policies and practices of the Company, except that when the terms of this Agreement differ from or are in conflict with the Company’s general employment policies or practices, this Agreement shall control.

2.Compensation.

2.1Salary.  For services to be rendered hereunder, you shall receive a base salary at the rate of Four hundred forty thousand ($440,000.00) per year (the “Base Salary”), subject to standard payroll deductions and withholdings and payable in accordance with the Company’s regular bi-monthly payroll schedule.  Your Base Salary will subject to annual review by the Company’s Chief Executive Officer.  

2.2Bonus.  You will be eligible to participate in the Company’s discretionary Performance Bonus Plan, with the potential to receive a target bonus of 40% of your Base Salary (the “Performance Bonus”).  Your Performance Bonus eligibility is based on the Company’s fiscal year, which runs from April 1 through March 31 of the next calendar year.  Whether you 

— 1 —

 

receive a Performance Bonus for any given fiscal year, and the amount of any such Performance Bonus, will be determined by the Company in its sole discretion, and is based on Company performance and your achievement of objectives and milestones to be determined by the Company for the applicable fiscal year.  The Performance Bonus will not be prorated for the fiscal year in which you begin employment or if the Company conducts your review or performance assessment for a period covering less than a full fiscal year.  To earn a Performance Bonus, except as otherwise provided herein, you must be employed by the Company on the last day of the applicable fiscal year.  Except as otherwise provided herein, you will not be eligible for, and will not earn, any Performance Bonus (including a prorated bonus) if your employment terminates for any reason before the end of the fiscal year.  The Company will pay any earned Performance Bonus by no later than thirty (30) days after the end of the Company’s fiscal year, or by May 31. 

3.Equity Incentive.  Subject to the approval of the Board of Directors of Urovant Sciences Ltd. (USL), the company’s parent, you will receive a Stock Option Grant Notice for an option to purchase 69,197 common shares of USL and a Restricted Stock Unit Grant Notice for 108,647 Restricted Stock Units of USL pursuant to the 2017 Equity Incentive Plan, As Amended and Restated, (collectively, “Initial Equity Award”).  This Initial Equity Award will be granted on June 2, 2020 and (i) will be subject to a 4-year vesting period, with 25% vesting at year one (1) and quarterly vesting thereafter for twelve (12) successive quarters, as well as any other terms and conditions contained in the grant agreements; and (ii) all stock options will expire and cease to be exercisable on the ten (10) year anniversary of the grant date.  Per your Initial Equity Award Grant Notices, all shares received under this Initial Equity Award shall immediately become fully vested and exercisable immediately prior to (and contingent upon) a Change In Control as defined in the 2017 Equity Incentive Plan, Amended and Restated.  In addition, any unvested outstanding equity awards, including awards that would otherwise vest only upon satisfaction of performance criteria, shall accelerate and become vested and exercisable immediately prior to (and contingent upon) a Change In Control as defined in the operative Equity Incentive Plan.   

You will be eligible to receive additional discretionary annual equity incentive grants in amounts commensurate with your position (“Annual Equity Grants”).  The Annual Equity Grants will be based upon meeting  Company and individual performance metrics to be mutually agreed upon in writing annually.  The Annual Equity Grants (i) will be subject to a 4-year vesting period, with 25% vesting at year one (1) and quarterly vesting thereafter for twelve (12) successive quarters , as well as any other terms and conditions contained in the grant agreements; and (ii) all stock options will expire and cease to be exercisable on the ten (10) year anniversary of the grant date.  All shares received under the Annual Equity Grants shall immediately become fully vested and exercisable immediately prior to (and contingent upon) a Change In Control as defined in the operative Equity Incentive Plan, Amended and Restated.  In addition, any unvested outstanding equity awards, including awards that would otherwise vest only upon satisfaction of performance criteria, shall accelerate and become vested and exercisable immediately prior to (and contingent upon) a Change In Control as defined in the operative Equity Incentive Plan

— 2 —

 

4.Sign On Bonus.  

You are eligible to receive a $150,000.00 sign on bonus, less taxes and deductions, paid in two installments as follows: the first installment of $75,000.00 will be paid in June 2021; the second installment of $75,000.00 will be paid in June 2022.  You must be employed at the time of the sign on bonus installment payments to receive the sign on bonus installment payments and, should you voluntarily leave the Company within two years of your last installment payment, you agree to repay the most recent installment amount.  Should your employment end for good reason or in the event of a change in control, any unpaid portion of your sign on bonus will be paid to you upon your termination.

5.Relocation.  You are eligible to receive business travel reimbursement, per our travel and expense policy, to Irvine, California and other areas as deemed necessary for business related activities.  You are also eligible for up to one year from your start date to receive relocation assistance in the amount of $75,000, less taxes and deductions, to assist you in the purchase of a property in Orange County, California.  This payment will be made to you upon verification that you have purchased a residence in Orange County, California within one year from your start date.  We will also reimburse you for any non-recurring expenses as a result of your home purchase and the Company will cover the costs on the shipment of your household goods to your new residence.  Upon the purchase of a residence in Orange County, California the Company will no longer reimburse you for expenses for travel to Orange County, California from Illinois.  

6.Executive Vacation.  We believe that you are in the best position to determine when to work and when to take time away from work, while still responsibly performing your duties and responsibilities.  Consequently, instead of providing you with a fixed number of vacation days each year, you may take time off with pay for rest and relaxation, or to attend to personal matters at your discretion, subject to fulfilling performance expectations and coordinating time off with our CEO.

7.Standard Company Benefits.  You shall be entitled to participate in all other employee benefit programs for which you are eligible under the terms and conditions of the benefit plans that may be in effect from time to time and provided by the Company to its employees.  These benefits include health, dental, and other insurance coverage, participation in the Company’s 401(k) plan, and holiday and sick leave.  Insurance coverage will begin on the first day of the first full month after your employment begins.  The official plan documents will control.  The Company reserves the right to cancel or change the benefit plans or programs it offers to its employees at any time in its discretion.   

8.At-Will Employment.  Your employment relationship is at-will.  The Company may modify your job title, compensation, duties, and other terms and conditions of employment as it deems necessary and appropriate in light of the Company’s needs and interests from time to time. Additionally, either you or the Company may terminate the employment relationship at any time, with or without cause or advance notice.   Upon termination of your employment for any reason, you shall resign from all positions and terminate any relationships as an employee, advisor, officer, or director with the Company and any of its affiliates, each effective on the date of termination.   Upon the termination of your employment for any reason, you shall be entitled to receive: (a) any earned but unpaid Base Salary; (b) any vested employee benefits in 

— 3 —

 

accordance with the terms of the applicable employee benefit plan or program; (c) any unreimbursed business expenses incurred in accordance with Company policy; and (d) any earned but unpaid Performance Bonus for any performance years that were completed as of the date of termination.  In addition, you may be eligible to receive additional payments and benefits, as set forth in more detail below. 

9.Termination of Employment; Severance Benefits.

9.1Termination Without Cause or Resignation for Good Reason During the Change in Control Determination Period.  In the event your employment with the Company is terminated by the Company without Cause, or you resign for Good Reason, in either event during the Change in Control Determination Period, then provided such termination constitutes a “separation from service” (as defined under Treasury Regulation Section 1.409A-1(h), without regard to any alternative definition thereunder, a “Separation from Service”), and provided that you remain in compliance with the terms of this Agreement, the Confidentiality Agreement, the Arbitration Agreement, and any other agreement between you and the Company, the Company shall provide you with the following Change in Control Severance Benefits:

a.The Company shall pay you, as severance, the equivalent of 100% of your Base Salary in effect as of the date of your employment termination and disregarding for this purpose any decrease in annual base salary constituting Good Reason, subject to standard payroll deductions and withholdings (the “CIC Salary Severance”).  The CIC Salary Severance will be paid as one-time, lump-sum payment no later than the first regularly-scheduled payroll date following the sixtieth (60th) day after your Separation from Service, provided the Separation Agreement (as discussed in Section 6.5) has become effective.

b.The Company shall pay you, as additional severance, an amount equal to the sum of (i) 100% of your target annual Performance Bonus for the year of termination; and (ii) a pro rata target annual Performance Bonus for the year of termination, calculated by multiplying your target Performance Bonus amount as of the date of termination by a fraction, the numerator of which is the number of days worked in the performance year and the denominator of which is 365 (the “CIC Bonus Severance”).  The CIC Bonus Severance will be paid as a one-time, lump-sum payment contemporaneously with the CIC Salary Severance, but in no event later than the first regularly-scheduled payroll date following the sixtieth (60th) day after your Separation from Service, provided the Separation Agreement (as discussed in Section 6.5) has become effective.

c.If you timely elect continued group health plan continuation coverage under COBRA or a state or local equivalent, such as Cal-COBRA, the Company shall pay the full amount of your premiums on behalf of you for your continued coverage under the Company’s group health plans, including coverage for your eligible dependents, for 9 months  or until such earlier date on which you become eligible for health coverage from another employer (the “COBRA CIC Payment Period”).  The level of coverage will be the same (if possible) as the level of coverage selected by you and in effect at the time of your termination. Upon the conclusion of such period of insurance premium payments made by the Company, you will be responsible for the entire payment of premiums (or payment for the cost of coverage) required under COBRA for the duration of your eligible COBRA coverage period.  Notwithstanding the 

— 4 —

 

foregoing, if you timely elect continued group health plan continuation coverage under COBRA and at any time thereafter the Company determines, in its sole discretion, that it cannot provide the COBRA premium benefits without potentially incurring financial costs or penalties under applicable law (including, without limitation, Section 2716 of the Public Health Service Act) or violating Section 105(h) of the Code, then in lieu of paying the employer portion of the COBRA premiums on your behalf, the Company will instead pay you on the last day of each remaining month of the COBRA CIC Payment Period a fully taxable cash payment equal to 200% of the COBRA premium for that month, subject to applicable tax withholding (such amount, the “Special CIC Severance Payments”).  Such Special CIC Severance Payments shall end upon expiration of the COBRA CIC Payment Period. 

9.2Termination Without Cause or Resignation for Good Reason Not During the Change in Control Determination Period.  In the event your employment with the Company is terminated by the Company without Cause, or you resign for Good Reason, in either event not during the Change in Control Determination Period, then provided such termination constitutes a Separation from Service, and provided that you remain in compliance with the terms of this Agreement, the Confidentiality Agreement, the Arbitration Agreement, and any other agreement between you and the Company, the Company shall provide you with the following Non-CIC Severance Benefits:

a.The Company shall pay you, as severance, the equivalent of 75% of your Base Salary in effect as of the date of your employment termination and disregarding for this purpose any decrease in annual base salary constituting Good Reason, subject to standard payroll deductions and withholdings (the “Non-CIC Salary Severance”).  The Non-CIC Salary Severance will be paid as one-time, lump-sum payment no later than the first regularly-scheduled payroll date following the sixtieth (60th) day after your Separation from Service, provided the Separation Agreement (as discussed in Section 6.5) has become effective.

b.The Company shall pay you, as additional severance, an amount equal to a pro rata target annual Performance Bonus for the year of termination, calculated by multiplying your target bonus as of the date of termination by a fraction, the numerator of which is the number of days worked in the performance year and the denominator of which is 365 (the “Non-CIC Bonus Severance”).   The Non-CIC Bonus Severance will be paid as a one-time, lump-sum payment contemporaneously with the Non-CIC Salary Severance, but in no event later than the first regularly-scheduled payroll date following the sixtieth (60th) day after your Separation from Service, provided the Separation Agreement (as discussed in Section 6.5) has become effective.

c.If you timely elect continued group health plan continuation coverage under COBRA, or a state or local equivalent, such as Cal-COBRA, the Company shall pay a portion of your premiums on behalf of you for your continued coverage under the Company’s group health plans, including coverage for your eligible dependents, for nine (9) months or until such earlier date on which you become eligible for health coverage from another employer (the “COBRA Payment Period”).  The amount of this portion will be the same portion of the premium cost as was borne by the Company under the level of coverage selected by you and in effect at the time of your termination. Upon the conclusion of such period of insurance premium payments made by the Company, you will be responsible for the entire payment of premiums (or payment for the cost of coverage) required under COBRA for the duration of your eligible 

— 5 —

 

COBRA coverage period.  Notwithstanding the foregoing, if you timely elect continued group health plan continuation coverage under COBRA and at any time thereafter the Company determines, in its sole discretion, that it cannot provide the COBRA premium benefits without potentially incurring financial costs or penalties under applicable law (including, without limitation, Section 2716 of the Public Health Service Act) or violating Section 105(h) of the Code, then in lieu of paying the employer portion of the COBRA premiums on your behalf, the Company will instead pay you on the last day of each remaining month of the COBRA Payment Period a fully taxable cash payment equal to 200% of the employer’s portion of the COBRA premium for that month, subject to applicable tax withholding (such amount, the “Special Severance Payments”).  Such Special Severance Payments shall end upon expiration of the COBRA Payment Period.  

9.3Termination as a Result of Death or Disability.  

a.In the event that your employment is terminated as a result of your Disability, you will be eligible to receive the Non-CIC Bonus Severance, provided the Separation Agreement (as discussed in Section 6.5) has become effective.

b.In the event that your employment is terminated as a result of your death, you will not be eligible to receive any Severance Benefits pursuant to this Agreement.

9.4Termination for Cause; Resignation Without Good Reason.  If you resign without Good Reason or the Company terminates your employment for Cause, whether during the Change of Control Determination Period or not, then: (a) all payments of compensation by the Company to you hereunder will terminate immediately (except as to amounts already earned), and; (b) you will not be entitled to any Severance Benefits under this Section 6.

9.5Conditions to Receipt of Severance Benefits.  The receipt of any applicable Severance Benefits pursuant to this Section 6 will be subject to you signing and not revoking a separation agreement and release of claims in a form reasonably satisfactory to the Company (the “Separation Agreement”).  You shall also resign from all positions and terminate any relationships as an employee, advisor, officer or director with the Company and any of its affiliates, each effective on the date of termination.  No Severance Benefits will be paid or provided until the Separation Agreement becomes effective.  

9.6Definitions.

a.Cause.  For purposes of this Agreement, “Cause” for termination shall mean: (i) the continued failure by you to substantially perform your duties with the Company or any Subsidiary or Affiliate (other than any such failure resulting from incapacity due to physical or mental illness), after a written demand for substantial performance is delivered to you by the Company, or Subsidiary or Affiliate, that specifically identifies the alleged manner in which you have not substantially performed your duties and after you have been provided with a thirty (30) day cure period, or your deliberate violation of a Company policy; (ii) the engaging by you in illegal conduct or misconduct (including fraud, embezzlement, theft or dishonesty or material violation of any Company policy), or gross negligence, in any case that has caused or is reasonably expected to result in injury to the Company or any Subsidiary or Affiliate; (iii) your 

— 6 —

 

commission of, or plea of no contest to, a felony or any misdemeanor crime involving fraud, moral turpitude or dishonesty; (iv) your material breach of any written agreement or restrictive covenants with the Company or (v) violation of any law, rule or regulation (collectively, “Law”) relating in any way to the business or activities of the Company or any Subsidiary or Affiliate, or other Law that is violated, during the course of your performance of services hereunder that results in your regulatory suspension or disqualification, including, without limitation, the Generic Drug Enforcement Act of 1992, 21 U.S.C. § 335(a), or any similar legislation applicable in the United States or in any other country where the Company or any Subsidiary or Affiliate intends to develop its activities.  

b.Change in Control.  For purposes of this Agreement, “Change in Control” means the occurrence after the Effective Date of this Agreement of a “Change in Control” as defined in the Urovant Sciences Ltd. 2017 Equity Incentive Plan, as Amended and Restated, as in effect on the Effective Date of this Agreement.

c.Change in Control Determination Period. For purposes of this Agreement, “Change in Control Determination Period” means the time period beginning on the date on which a Change in Control occurs and ending twelve (12) months following the Change in Control.

d.Disability.  For purposes of this Agreement, “Disability” means total and permanent disability as defined in Section 22(e)(3) of the Internal Revenue Code of 1986, as amended.

e.Good Reason.  For purposes of this Agreement, “Good Reason” for your resignation shall mean: (i) a material diminution in your Base Salary as compared to below that Base Salary as set as of the time of the reduction; provided, however, that if such reduction occurs in connection with a Company-wide decrease in executive officer team compensation, such reduction shall not constitute Good Reason provided that it is a reduction of a proportionally like amount or percentage affecting the entire executive team not to exceed 10%; (ii) a material diminution in your authority, duties, or responsibilities; (iii) any requirement of the Company that you be based anywhere more than fifty (50) miles from your primary office location and in a new office location that is a greater distance from your principal residence; or (iv) the failure of any successor to expressly assume and agree to perform the severance provisions in this Agreement.   Notwithstanding the foregoing, a termination for Good Reason shall not have occurred unless you give written notice to the Company of your intention to terminate employment within thirty (30) days after the occurrence of the event constituting Good Reason, specifying in reasonable detail the circumstances constituting Good Reason, and the Company has failed within thirty (30) days after receipt of such notice to cure the circumstances constituting Good Reason and you terminate employment on a mutually-agreeable date not more than thirty (30) days following the expiration of the Company’s cure period.

10.Section 280G.  Any provision of the Plan to the contrary notwithstanding, if any payment or benefit a Covered Employee would receive from the Company and its Subsidiaries or an acquiror pursuant to the Plan or otherwise (a “Payment”) would (i) constitute a “parachute payment” within the meaning of Section 280G of the Code, and (ii) but for this sentence, be subject to the excise tax imposed by Section 4999 of the Code 

— 7 —

 

(the “Excise Tax”), then such Payment will be equal to the Higher Amount (defined below).  The “Higher Amount” will be either (x) the largest portion of the Payment that would result in no portion of the Payment being subject to the Excise Tax or (y) the largest portion, up to and including the total, of the Payment, whichever amount, after taking into account all applicable federal, state and local employment taxes, income taxes, and the Excise Tax (all computed at the highest applicable marginal rate), results in Covered Employee’s receipt, on an after-tax basis, of the greater economic benefit notwithstanding that all or some portion of the Payment may be subject to the Excise Tax. If a reduction in payments or benefits constituting “parachute payments” is necessary so that the Payment equals the Higher Amount, reduction will occur in the manner that results in the greatest economic benefit for a Covered Employee.  If more than one method of reduction will result in the same economic benefit, the items so reduced will be reduced pro rata.  Notwithstanding the foregoing, any reduction shall comply with Section 409A including, but not limited to, the ordering of any such reduction.  In no event will the Company, any Subsidiary or any stockholder be liable to any Covered Employee for any amounts not paid as a result of the operation of this Section 7.  The Company will use commercially reasonable efforts to cause the accounting or law firm engaged to make the determinations hereunder to provide its calculations, together with detailed supporting documentation, to Covered Employee and the Company within fifteen (15) calendar days after the date on which the Covered Employee’s right to a Payment is triggered (if requested at that time by the Covered Employee or the Company) or such other time as requested by the Covered Employee or the Company.  

11.Section 409A.  It is intended that all of the severance benefits and other payments payable under this Agreement satisfy, to the greatest extent possible, the exemptions from the application of Code Section 409A provided under Treasury Regulations 1.409A‐1(b)(4), 1.409A‐1(b)(5) and 1.409A‐1(b)(9), and this Agreement will be construed to the greatest extent possible as consistent with those provisions, and to the extent no so exempt, this Agreement (and any definitions hereunder) will be construed in a manner that complies with Section 409A.  For purposes of Code Section 409A (including, without limitation, for purposes of Treasury Regulation Section 1.409A‐2(b)(2)(iii)), your right to receive any installment payments under this Agreement (whether severance payments, reimbursements or otherwise) shall be treated as a right to receive a series of separate payments and, accordingly, each installment payment hereunder shall at all times be considered a separate and distinct payment.  Notwithstanding any provision to the contrary in this Agreement, if you are deemed by the Company at the time of your Separation from Service to be a “specified employee” for purposes of Code Section 409A(a)(2)(B)(i), and if any of the payments upon Separation from Service set forth herein and/or under any other agreement with the Company are deemed to be “deferred compensation,” then to the extent delayed commencement of any portion of such payments is required in order to avoid a prohibited distribution under Code Section 409A(a)(2)(B)(i) and the related adverse taxation under Section 409A, such payments shall not be provided to you prior to the earliest of (i) the expiration of the six-month period measured from the date of your Separation from Service with the Company, (ii) the date of your death or (iii) such earlier date as permitted under Section 409A without the imposition of adverse taxation.  Upon the first business day following the expiration of such applicable Code Section 409A(a)(2)(B)(i) period, all payments deferred pursuant to this Paragraph shall be paid in a lump sum to you, and any remaining payments due shall be paid as otherwise provided herein or in the applicable agreement. No interest shall be 

— 8 —

 

due on any amounts so deferred.  If a payment is subject to a release, and the release revocation period could span two years, then the payment will occur in the second of the two years if required in order to avoid taxation pursuant to Section 409A.

12.Proprietary Information Obligations.  As a condition of employment, you shall execute and abide by the Company’s standard form of Agreement for Protection of Company Information (the “Confidentiality Agreement”), attached as Exhibit A.  You acknowledge and agree that any prior assignments of intellectual property made by you to the Company in any separate or prior agreement remain in full force and effect.

13.Arbitration Obligations. As a condition of employment, you shall execute and abide by the Company’s standard form of Mutual Agreement to Arbitrate Claims (the “Arbitration Agreement”), attached as Exhibit B.  

14.Outside Activities During Employment.

14.1Non-Company Business.  Except with the prior written consent of our CEO, you will not during the term of your employment with the Company undertake or engage in any other employment, occupation or business enterprise, other than ones in which you are a passive investor.  You may engage in civic and not-for-profit activities so long as such activities do not materially interfere with the performance of your duties hereunder.  

14.2No Adverse Interests.  You agree not to acquire, assume or participate in, directly or indirectly, any position, investment or interest known to be adverse or antagonistic to the Company, its business or prospects, financial or otherwise.

15.General Provisions.

15.1Offer Conditions.  This Agreement and your continued employment with the Company are conditioned on you accepting and returning a signed copy of this Agreement.  This Agreement is also conditioned on: (a) you not being subject to any confidentiality, non-competition, or any other similar type of restriction that may affect your ability to perform your work at the Company; and (b) you not having been debarred, or having received notice of any action or threat with respect to debarment, under the provisions of the Generic Drug Enforcement Act of 1992, 21 U.S.C. 335(a) or any similar legislation applicable in the US or in any other country where the Company intends to develop its activities.  By signing this Agreement, you represent and warrant that you are not subject to any such limitations or restrictions.

15.2Severability; Waiver.  Whenever possible, each provision of this Agreement will be interpreted in such a manner as to be effective and valid under applicable law, but if any provision of this Agreement is held to be invalid, illegal or unenforceable in any respect under any applicable law or rule in any jurisdiction, such invalidity, illegality or unenforceability will not affect any other provision of this Agreement, but this Agreement will be reformed, construed and enforced in such jurisdiction to the extent possible in keeping with the intent of the parties.  Any waiver of any breach of any provisions of this Agreement must be in writing to be effective, and it shall not thereby be deemed to have waived any preceding or succeeding breach of the same or any other provision of this Agreement.

— 9 —

 

15.3Complete Agreement.  This Agreement, together with the Confidentiality Agreement and the Arbitration Agreement, constitutes the entire agreement between you and the Company with regard to this subject matter and is the complete, final, and exclusive embodiment of the Parties’ agreement with regard to this subject matter.  This Agreement is entered into without reliance on any promise or representation, written or oral, other than those expressly contained herein; supersedes any other such promises, warranties or representations; and it cannot be modified or amended except in a writing signed by a duly authorized officer of the Company.

15.4Counterparts; Headings.  This Agreement may be executed in separate counterparts, any one of which need not contain signatures of more than one party, but all of which taken together will constitute one and the same Agreement.  The headings of the paragraphs hereof are inserted for convenience only and shall not be deemed to constitute a part hereof nor to affect the meaning thereof.

15.5Successors and Assigns.  This Agreement is intended to bind and inure to the benefit of and be enforceable by you and the Company, and their respective successors, assigns, heirs, executors and administrators.  The Company may freely assign this Agreement, without your prior written consent.  You may not assign any of your duties hereunder and you may not assign any of your rights hereunder without the written consent of the Company.

15.6Tax Withholding.  All payments and awards contemplated or made pursuant to this Agreement will be subject to withholdings of applicable taxes in compliance with all relevant laws and regulations of all appropriate government authorities.  You acknowledge and agree that the Company has neither made any assurances nor any guarantees concerning the tax treatment of any payments or awards contemplated by or made pursuant to this Agreement.  You have had the opportunity to retain a tax and financial advisor and fully understand the tax and economic consequences of all payments and awards made pursuant to the Agreement.

15.7Term; Survival; Choice of Law.  This Agreement shall terminate upon your termination of employment with the Company.  The obligations as forth under Sections 6, 7, 8, 9, and 11, as well as under the Confidentiality Agreement and the Arbitration Agreement, will survive the termination of your employment and this Agreement.  All questions concerning the construction, validity and interpretation of this Agreement will be governed by the laws of the State of California.  

— 10 —

 

In Witness Whereof, the Parties have executed this Agreement on the day and year first written above.

 

	
Urovant Sciences, Inc.

	
By:
	
 
	
 

	
Name:
	
 
	
Nori Ebersole

	
Title:
	
 
	
Chief Human Resources Officer

 

	
Executive
	
 

	
 
	
 

	
C. Walt Johnston
	
 

	
Date:
	
 
	
 
	
 
	
 

 

— 11 —

 

Exhibit A

Form of Agreement for Protection of Company Information

In exchange for the opportunity for employment or continued employment with Urovant Sciences, Inc. and any related entities (collectively, the “Company”), because the Company has provided and will continue to actively provide me with confidential information as a result of such employment, and/or for other valuable consideration, I, the undersigned employee, agree to the following:

1.Obligations to Prior Employers. I agree that I will not bring and have not brought to the Company any trade secrets that belong to any prior employers of mine, and I will not use or disclose and have not used or disclosed any trade secrets of any prior employer of mine in performing work for the Company. I further agree that I will not violate and have not violated any valid contractual commitments I have made with any prior employer in connection with my work for the Company.

2.Loyalty to the Company. I understand that I must devote my undivided loyalty and best efforts to the business of the Company. As a result, during my employment, I will not, other than for the Company, engage in any other employment, activity, or business: (i) in which the Company is now or may hereafter become engaged; (ii) that directly competes with the current or future business of the Company; (iii) that uses any Company information, equipment, supplies, facilities or materials; or (iv) otherwise conflicts with or is detrimental to the Company’s business interests or causes, or may reasonably be expected to cause a disruption of its operations.

3.Confidential Information of This Company. I hereby acknowledge that during my employment with the Company, the Company has provided and will actively provide me access to certain confidential and/or proprietary information regarding the Company and its business (collectively, “Confidential Information”) that is not generally known outside of the Company and that would not otherwise be provided to me without my execution of this Agreement. Confidential Information includes, without limitation, the following materials and information (whether or not reduced to writing and whether or not patentable or protected by copyright): trade secrets; inventions; processes; formulae; programs; technical data; financial information; Company-developed software; engineering designs and documentation; customer proposals, specifications, requirements, as well as marketing and advertising plans and strategies; customer identities, lists, and confidential information about customers and their buying habits; confidential information about prospects, suppliers, vendors, and key employees; personal information relating to the Company’s employees; mailing and e-mail lists; and any other confidential or proprietary information relating to the Company’s business. I understand that the Confidential Information has economic value because it is not generally known to the public or to other persons who can obtain economic value from its disclosure or use and I further understand that the Company expends considerable efforts to maintain the secrecy of the Confidential Information. I understand and agree that I am authorized to access and use Confidential Information solely for Company business and that I am not authorized to access any 

— 12 —

 

computer systems containing Confidential Information except in furtherance of the Company’s business.

4.No Misappropriation. During the term of my employment and thereafter, I hereby promise not to disclose or use, or induce or assist in the disclosure or use of, any Confidential Information except for the benefit of the Company. In addition, at no time after the end of my employment with the Company will I seek to obtain or misappropriate, or induce or assist in the obtaining or misappropriation, any of the Company’s trade secrets or other Confidential Information from any current or former Company employee, independent contractor, consultant, or any other source. Notwithstanding the confidentiality obligations set forth in this paragraph, I understand that, pursuant to the Defend Trade Secrets Act of 2016 (“DTSA”), I will not be held criminally or civilly liable under any federal or state trade secret law for the disclosure of a trade secret that: (A) is made (i) in confidence to a federal, state, or local government official, either directly or indirectly, or to an attorney; and (ii) solely for the purpose of reporting or investigating a suspected violation of law; or (B) is made in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal.  I also understand that if I file a lawsuit for retaliation by the Company for reporting a suspected violation of law, I may disclose the trade secret to my attorney and use the trade secret information in the court proceeding, if I (A) file any document containing the trade secret under seal; and (B) do not disclose the trade secret, except pursuant to court order.  I further understand that if a court of law or arbitrator determines that I misappropriated Company trade secrets willfully or maliciously, including by making permitted disclosures without following the requirements of the DTSA as detailed in this paragraph, then the Company may be entitled to an award of exemplary damages and attorneys' fees.

5.Return of Property and Confidential Information. I agree not to remove any Company property or Confidential Information from Company premises without express written permission, and I agree to return all Company property and Confidential Information, in any form, at the time my employment with the Company ends for any reason or upon the earlier request of the Company. To the extent that I possess any Confidential Information in digital or other electronic form, I will work with the Company to secure said Confidential Information in accordance with the Company’s direction. Upon the request of the Company, I will execute a document confirming my agreement to honor my responsibilities contained in this Agreement after my departure.

6.Agreement Not to Solicit Employees.  I further agree that, during my employment with the Company, and for a period of one (1) year after the end of my employment relationship with the Company for any reason, I will not, directly or indirectly, either on my own behalf or on behalf of any other person or entity, attempt to employ, solicit for employment, or otherwise seek to employ or retain any employee or consultant of the Company, or in any way assist or facilitate any such employment, solicitation, or retention effort.

7.Assignment of Intellectual Property.

(a)“Intellectual Property” means any idea, concept, design, suggestion, discovery, invention, copyright, patent, trademark, trade secret, or other intellectual property of any nature, including computer graphics, programs, and/or algorithms, processes, diagrams, know-how, 

— 13 —

 

drawings, notes, memoranda, digital representations, illustrations, videos, photographs, and/or pictorial representations of any nature. “Inventions” means all discoveries, developments, designs, improvements, formulas, and processes.

(b)I agree to identify all Intellectual Property and Inventions, as defined above, of mine that existed prior to my employment with the Company within fourteen (14) days after beginning my employment by completing and returning Exhibit 1 hereto. I understand and agree that if I do not identify my Intellectual Property and Inventions within the 14-day period, all such Intellectual Property and Inventions will not be reserved and will be considered part of my background training and experience that I am providing to the Company as consideration for its employment of me.  I have also received and understand the Limited Exclusion Notification attached as Exhibit 2 hereto. 

(c)I acknowledge and agree that all works that I may create for or author during the period of my employment with the Company which relate or are useful to the business, or demonstrably anticipated business of the Company, whether or not created during my working time, are within the scope of my employment relationship with the Company and are works for hire, and that the Company owns all rights in such works of authorship. To the extent that such works of authorship are not works for hire, I hereby assign them to the Company as set out in subparagraph (e), below.

(d)I will fully and promptly disclose to the Company, and I hereby assign to the Company as set out in subparagraph (e), below, any and all Intellectual Property that is related or useful to the business, or demonstrably anticipated future business, of the Company which I may solely or jointly conceive, design, develop, create, or suggest or cause to be conceived, designed, developed, created, or suggested during my employment with the Company, whether or not conceived, designed, developed, created, or suggested during my working time. However, the foregoing sentence will not apply to any Invention that qualifies fully under the provisions of California Labor Code § 2870, where I developed the Invention entirely on my own time without using the Company’s equipment, supplies, facilities, or trade secret information, except for those Inventions that (i) relate at the time of their conception or reduction to practice to the Company’s business, or to actual or demonstrably anticipated research or development of the Company; or (ii) result from any work performed by me for the Company.

(e)Any works of authorship referred to in subparagraph (c), above, and any Intellectual Property referred to in subparagraph (d), above (except to the extent excluded from the scope of subparagraph (d) by virtue of the statute referenced therein), are referred to as “Company-Related Intellectual Property.” All right, title, and interest in and to the Company- Related Intellectual Property, including any renewal and extension rights, shall be the sole and absolute property of the Company. I agree that, without additional consideration or compensation of any kind, I will assign and I hereby do assign to the Company all my right, title, and interest in and to any Company-Related Intellectual Property now or hereafter existing and all renewal and extension rights, and I agree to execute any documents necessary to evidence the Company’s proprietary interest in any Company-Related Intellectual Property. I acknowledge and agree that new rights to the results and proceeds of my services may come into being in the future under law and/or in equity, and I hereby assign, grant, and convey to the Company any and all such rights, renewals, and extensions thereof in and to such results and proceeds. In the event the 

— 14 —

 

Company is unable for any reason whatsoever to secure my signature to any lawful and necessary document required to apply for protection of, or enforce any action with respect to, Company-Related Intellectual Property, I hereby irrevocably designate and appoint the Company and its duly-authorized officers and agents as my agent and attorney-in-fact to act for and in my behalf to execute such documents and to do all other lawfully permitted acts to protect the Company’s interest in any Company-Related Intellectual Property with the same legal force and effect as if executed by me.

(f)I will not knowingly do anything to imperil the validity of any intellectual property rights of the Company, and will not do or omit to do any act which may invalidate any application for the same or in any way publish or cause to be published any material relating to Company-Related Intellectual Property.

8.Complete Agreement. This agreement constitutes the complete agreement between the Company and me relating to the subject matter of it and supersedes any and all prior written or oral agreements or understanding relating to the subject matter of this agreement. I understand that no representative of the Company has been authorized to enter into any agreement or commitment with me which is inconsistent in any way with the terms of this agreement. I also understand and agree that this agreement does not in any way change the at-will nature of my employment relationship with the Company. This Agreement may not be modified except in a writing signed by the party to be bound.

9.Governing Law. This agreement will be governed by the law of the state of California.

10.Severability. The invalidity or nonenforceability of any part of this agreement does not affect the validity or enforceability of any other part. If any part of this agreement is for any reason held to be excessively broad as to time, duration, activity or subject, it shall be construed by limiting and reducing it so as to be enforceable.

11.Successors. I understand and agree that this agreement is binding upon my heirs, executors, administrators and other personal and legal representatives of mine.

12.Voluntary Agreement. I understand that this agreement includes obligations in addition to those obligations which may be imposed or implied by law, and I certify that I have read, understand and voluntarily agree to and undertake the obligations set forth in this agreement. I agree that it is not necessary for the Company to sign this agreement for it to be binding on me.

 

	
Employee Signature:
	
 
	
 

 

	
Employee Printed Name:
	
 
	
C. Walt Johnston

 

	
Dated:
	
 
	
 

 

 

— 15 —

 

EXHIBIT 1

Identification of Intellectual Property and Inventions

If no response is provided to any of the requests below, this will mean that your response to that item is “none.”

	
1.
	
Please identify and describe any Intellectual Property (as defined in paragraph 8(a), above), which you have developed or in which you have some ownership interest:

	
2.
	
Please describe any Inventions (as defined in paragraph 10(a), above), which you have developed or in which you have some ownership interest:

 

	
Employee Signature:
	
 
	
 

 

	
Employee Printed Name:
	
 
	
C. Walt Johnston

 

	
Dated:
	
 
	
 

 

1.

 

Exhibit 2

Limited Exclusion Notification

This is to notify you in accordance with Section 2872 of the California Labor Code that the foregoing Agreement between you and Company does not require you to assign or offer to assign to Company any Invention that you develop entirely on your own time without using Company’s equipment, supplies, facilities or trade secret information, except for those Inventions that either:

(a)Relate at the time of conception or reduction to practice to Company’s business, or actual or demonstrably anticipated research or development; or

(b)Result from any work performed by you for Company.

To the extent a provision in the foregoing Agreement purports to require you to assign an Invention otherwise excluded from the preceding paragraph, the provision is against the public policy of this state and is unenforceable.

This limited exclusion does not apply to any patent or Invention covered by a contract between Company and the United States or any of its agencies requiring full title to such patent or Invention to be in the United States.

2.

 

Exhibit B

Form of Mutual Agreement to Arbitrate Claims

Urovant Sciences, Inc. (the “Company”) and I, the undersigned employee, recognize and desire the benefits of a speedy, impartial, final and binding dispute resolution procedure. For these reasons, and in consideration of the mutual promises in this agreement to arbitrate (“Agreement”) and benefits of our employment relationship, the Company and I mutually consent to the resolution by arbitration of all claims or controversies (“claims”), past, present or future, whether or not arising out of my employment (or its termination), as stated below.

1.Arbitrable Claims. Arbitrable claims are those that the Company (or its subsidiaries and affiliates) may have against me or that I (and no other party) may have against any of the following: (1) the Company, (2) its officers, directors, employees or agents in their capacity as such or otherwise, (3) its parent, subsidiary and affiliated entities, (4) benefit plans or the plans’ sponsors, fiduciaries, administrators, affiliates and agents, and/or (5) all successors and assigns of any of them. The only claims that are arbitrable are those that could be brought under applicable state or federal law and which lawfully can be the subject of an agreement to arbitrate. Arbitrable claims include, but are not limited to: claims for wages, bonuses, or other compensation due; claims for breach of any contract or covenant (express or implied); tort claims; claims for discrimination (including, but not limited to, race, sex, sexual orientation, religion, national origin, age, marital status, military or veterans status, physical or mental disability or handicap, or medical condition), harassment or retaliation; claims for benefits (except claims under an employee benefit or pension plan that either specifies that its claims procedure shall culminate in an arbitration procedure different from this one, or is underwritten by a commercial insurer which decides claims); and claims for violation of any federal, state, or other governmental law, statute, regulation, or ordinance, except claims for: workers’ compensation or unemployment compensation benefits; claims covered by (and defined in the Franken Amendment, first enacted in Section 8116 of the Defense Appropriations Act of 2010, or any similar statute, regulation or executive order. Both the Company and I agree that neither of us shall initiate or prosecute any lawsuit in any way related to any claim covered by this Agreement, other than to seek temporary equitable relief in aid of arbitration where such relief is available by law. I understand that nothing in this Agreement prohibits me from filing a complaint, charge, or other communication with any administrative or other governmental agency.

2.Law Governing this Agreement. The Federal Arbitration Act shall govern the interpretation, enforcement and all proceedings pursuant to this Agreement. To the extent that the Federal Arbitration Act is inapplicable, or held not to require arbitration of a particular claim or claims, the arbitration law of the state in which I work or last worked for the Company shall apply.

3.Arbitration Provider and Rules. The arbitration will be conducted through Judicial Arbitration & Mediation Services (JAMS). The arbitration shall take place in the county (or comparable government unit) in which I am or was last employed by the Company, and no dispute affecting my rights or responsibilities shall be adjudicated in any other venue or forum. The arbitration will be conducted in accordance with the then-current JAMS Employment Arbitration Rules & Procedures (and no other JAMS rules), which currently are available at 

3.

 

http://www.jamsadr.com/rules-employment-arbitration. I understand that the Company will provide me a written copy of those rules upon my request. The arbitrator shall be either a retired judge, or an attorney who is experienced in employment law and licensed to practice law in the state in which the arbitration is convened (the “Arbitrator”), selected as provided by the JAMS rules. If a JAMS arbitrator is not available to conduct an arbitration in the location where the arbitration is to occur, then another arbitration service provider will be selected by mutual agreement of the parties (and all references to JAMS will be deemed to be references to that arbitration service provider). If the parties cannot agree on an alternative arbitration service provider, the court upon petition or motion shall designate one. The Arbitrator shall apply the substantive law (and the law of remedies, if applicable) of the state in which the claim arose, or federal law, or both, as applicable to the claim(s) asserted. The Arbitrator is without jurisdiction to apply any different substantive law or law of remedies. The Arbitrator has the authority to hear and rule on dispositive motions (such as motions for summary adjudication or summary judgment). The Federal Rules of Evidence shall apply. The Arbitrator shall render an award and written opinion, which shall include the factual and legal basis for the award, normally within 30 days after a dispositive motion is heard, or an arbitration hearing (including any post-hearing briefing) is completed.

4.Arbitration Costs and Fees. The Company will be responsible for paying any filing fee and the fees and costs of the Arbitrator; provided, however, that if I am the party initiating the claim, in the first instance, I will contribute an amount equal to the filing fee to initiate a claim in the court of general jurisdiction in the state in which I am (or was last) employed by the Company, unless the JAMS rules or the Arbitrator allow me to proceed without doing so based on demonstrated financial hardship. Each party shall pay its own litigation costs and attorneys’ fees, if any. However, if any party prevails on a statutory claim which affords the prevailing party attorneys’ fees and litigation costs, or if there is a written agreement providing for attorneys’ fees and/or litigation costs, the Arbitrator shall rule upon a motion for attorneys’ fees and/or litigation costs under the same standards a court would apply under the law applicable to the claim(s) at issue.

5.Procedure for Asserting Claims. The party asserting the claim must give written notice of any claim to the other party no later than the expiration of the statute of limitations (deadline for filing) that the law prescribes for the claim. Otherwise, the claim shall be deemed waived. I understand that the party asserting the claim is encouraged to give written notice of any claim as soon as possible after the event or events in dispute so that arbitration of any differences may take place promptly. Written notice to the Company, or its officers, directors, employees or agents, shall be sent to the Company’s then-current headquarters address, c/o SVP, Head of Human Resources. I will be given written notice at the last address recorded in my personnel file. The written notice shall identify and describe the nature of all claims asserted, the facts upon which such claims are based and the relief or remedy sought. The notice shall be sent to the other party by certified or registered mail, return receipt requested.

6.Discovery. Each party shall have the right to take depositions of three fact witnesses and any expert witness designated by another party. Each party also shall have the right to make requests for production of documents consisting of up to 25 individual categories of requested documents in total to any party, and to subpoena documents from third parties. Requests for additional depositions or discovery may be made to the Arbitrator selected pursuant to this Agreement. The Arbitrator may grant such additional discovery if the Arbitrator finds that the party has demonstrated that it needs that discovery to adequately arbitrate the claim, taking into 

4.

 

account the parties’ mutual desire to have a speedy, less-formal, and cost-effective dispute-resolution mechanism.

7.Individual Dispute Resolution. To the maximum extent permitted by law, I hereby waive any right to bring on behalf of persons other than myself, or to otherwise participate with other persons in, any class, collective, or representative action (including but not limited to any representative action under the California Private Attorneys General Act (“PAGA”), or other federal, state or local statute or ordinance of similar effect). I understand, however, that to the maximum extent permitted by law I retain the right to bring claims in arbitration, including PAGA claims, for myself as an individual (and only for myself). If a court adjudicating a case involving the Company and me were to determine that there is an unwaivable right to bring a PAGA representative action, any such representative action shall be brought only in court, and not in arbitration.

8.Finality. The decision of the Arbitrator will be final, conclusive and binding on the parties to the arbitration, except as provided by law. Judgment may be entered on the Arbitrator’s decision in any court having jurisdiction.

9.Complete Agreement. This is the complete agreement between the Company and me on the subject hereof; provided, however, that if for any reason this Agreement is held unenforceable, then any prior agreement to arbitrate between the Company and me shall survive. No party is relying on any representations, oral or written, on the subject of the effect, enforceability or meaning of this Agreement, except as specifically set forth in this Agreement. This Agreement shall survive the termination of my employment and the expiration of any benefit plan.

10.Company Bound. I understand that, by the act of presenting this Agreement to me, the Company has agreed to bind itself to (and is entitled to invoke) this Agreement upon my execution of it, without need for a signature on its part.

11.Severability. If any provision of this Agreement is adjudged to be void or otherwise unenforceable, in whole or in part, such adjudication shall not affect the validity of the remainder of the Agreement. All other provisions shall remain in full force and effect based upon the mutual intent of the Company and me to create a binding agreement to arbitrate any disputes between us.

I UNDERSTAND THAT I AM GIVING UP MY RIGHT TO A JURY TRIAL.  I FURTHER ACKNOWLEDGE THAT I HAVE BEEN GIVEN THE OPPORTUNITY TO DISCUSS THIS AGREEMENT WITH MY PRIVATE LEGAL COUNSEL AND HAVE AVAILED MYSELF OF THAT OPPORTUNITY TO THE EXTENT I WISHED TO DO SO.

 

	
 
	
 
	
 
	
 

	
Employee Signature
	
 
	
Date
	
 

	
C. Walt Johnston
	
 
	
 
	
 

	
Printed Name
	
 
	
 
	
 

 

5.Exhibit 10.1 

 

 

 

 

 

 

 

Master
Distribution Agreement

 

between

Creative
Realities, Inc. 

and

InReality,
LLC 

 

dated
as of: June 19, 2020

 

    

     

    

 

Distribution
Agreement

 

This
Distribution Agreement (“Agreement”), dated as of June 19, 2020, is entered into by and between Creative
Realities, Inc., a Minnesota corporation (“Master Distributor”), and InReality, LLC, a Wisconsin limited liability
company (“Seller”, and together with Master Distributor, the “Parties”, and each, a “Party”).

 

RECITALS

 

A.             
Master Distributor is in the business of providing and selling digital marketing technology and solutions to companies and
organizations in the United States.

 

B.             
Seller is in the business of developing, manufacturing, and selling digital temperature solutions, including the Goods (as
defined below), and providing corresponding software-as-a-service platforms;

 

C.             
Master Distributor wishes to purchase the Goods from Seller and resell the Goods to Customers (as defined below), subject
to the terms and conditions of this Agreement; and

 

D.             
Seller wishes to sell the Goods to Master Distributor and appoint Master Distributor as an exclusive distributor of the
Goods in the Territory under the terms and conditions of this Agreement.

 

AGREEMENT

 

NOW, THEREFORE, in consideration
of the mutual covenants, terms, and conditions set out herein, and for other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the Parties hereby agree as follows:

ARTICLE
I

DEFINITIONS

 

Capitalized terms have
the meanings set out in this Section, or in the Section in which they first appear in this Agreement.

 

“Action”
means any claim, action, cause of action, demand, lawsuit, arbitration, inquiry, audit, notice of violation, proceeding, litigation,
citation, summons, subpoena, or investigation of any nature, civil, criminal, administrative, regulatory, or other, whether at
law, in equity, or otherwise.

 

“Affiliate”
of a Person means any other Person that directly or indirectly, through one or more intermediaries, Controls, is Controlled by,
or is under common Control with, this Person.

“Agreement”
means this Distribution Agreement (including all of its schedules, exhibits, and attachments), as the same may be amended from
time to time.

 

    1

     

    

 

“Business Day”
means any day except Saturday, Sunday, or any day other than Saturday, Sunday, or a federal holiday.

 

“Claim”
means any Action made or brought against a Person entitled to indemnification under Article XIV.

 

“Confidential
Information” has the meaning set out in Article XI. 

 

“Confirmation”
has the meaning set forth in Section 6.03.

 

“Control”
(and with correlative meanings, the terms “Controlled by” and “under common Control with”) means, regarding
any Person, the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies
of another Person, whether through the ownership of voting securities, by contract, or otherwise.

 

“Customer”
means a purchaser that is (a) a reseller or distributor, whether or not located in the Territory, who purchases Goods for resale
to End Users located in the Territory or (b) an End User in the Territory.

 

“Defective”
means not conforming to the warranties in Section 13.01.

 

“Defective Goods”
means goods that are Defective, which for the avoidance of doubt, includes any Nonconforming Goods accepted by Master Distributor
under Section 7.03.

 

“Delivery Date”
means the delivery date for Goods ordered hereunder that is set out in a Purchase Order.

 

“Delivery Location”
means the street address specified in the applicable Purchase Order.

 

“Disclosing Party”
has the meaning set out in Section 11.01. 

 

“Dispute”
has the meaning set out in Section 17.13.

 

“Dispute Notice”
has the meaning set out in Section 17.13.

   

“Effective Date”
means the date first set out in the Preamble to this Agreement.

 

“Encumbrance”
means any charge, claim, community property interest, pledge, condition, equitable interest, lien (statutory or other), option,
security interest, mortgage, easement, encroachment, right of way, right of first refusal, or restriction of any kind, including
any restriction on use, voting, transfer, receipt of income, or exercise of any other attribute of ownership.

 

“End User”
means the final purchaser that (a) has acquired a Good from Master Distributor for (i) its own and its Affiliates’ use and
not for resale, remarketing, or distribution or (ii) incorporation into its own services and (b) is an individual or entity, other
than any Governmental Authority, located in the Territory. The term “End User” explicitly includes individuals or entities
whose operations are headquartered within the Territory, but who acquire Goods from Master Distributor for its own and its Affiliates’
use outside of the Territory.

 

    2

     

    

 

“Excess Goods”
means Goods that, when counted together with all other Goods having the same UPC or SKU, as applicable, and received by Master
Distributor under the same Purchase Order, are in excess of the quantities of the Goods ordered under that Purchase Order.

 

“Force Majeure
Event” has the meaning set out in Section 17.16.

 

“Forecast”
means, regarding any three-month period, a good faith, non-binding forecast of Master Distributor’s demand for each calendar
month during the period, by Goods, which approximates, as nearly as possible, based on information available at the time to Master
Distributor, the Purchase Orders Master Distributor will place in these future calendar months.

 

“Goods”
means those goods that are identified in Schedule 1, as it may be revised by the Parties pursuant to Section 5.04
from time to time, including any Software developed by Seller which is embedded in the Goods. For the purposes of Section 7.03
and Section 7.05, Goods are deemed to include Nonconforming Goods.

 

“Governmental
Authority” means any federal, state, local, or foreign government or political subdivision thereof, or any agency or
instrumentality of the government or political subdivision, or any self-regulated organization or other non-governmental regulatory
authority, or quasi-governmental authority (to the extent that the rules, regulations, or orders of this organization or authority
have the force of Law), or any arbitrator, court, or tribunal of competent jurisdiction.

 

“Governmental
Order” means any order, writ, judgment, injunction, decree, stipulation, award, or determination entered by or with any
Governmental Authority, including, without limitation, with respect to COVID-19 or any other epidemic or pandemic illness.

 

“Initial Term”
has the meaning set out in Section 10.01.

 

“Intellectual
Property Rights” means all industrial and other intellectual property rights comprising or relating to: (a) Patents;
(b) Trademarks; (c) internet domain names, whether or not Trademarks, registered by any authorized private registrar or Governmental
Authority, web addresses, web pages, website, and URLs; (d) works of authorship, expressions, designs, and design registrations,
whether or not copyrightable, including copyrights and copyrightable works, software, and firmware, application programming interfaces,
architecture, files, records, schematics, data, data files, and databases and other specifications and documentation; (e) Trade
Secrets; (f) semiconductor chips, mask works and the like; and (g) all industrial and other intellectual property rights, and all
rights, interests, and protections that are associated with, equivalent or similar to, or required for the exercise of, any of
the foregoing, however arising, in each case whether registered or unregistered and including all registrations and applications
for, and renewals or extensions of, these rights or forms of protection under the Laws of any jurisdiction throughout in any part
of the world.

 

    3

     

    

 

“Last-Time Buy
Period” has the meaning set out in Section 5.04(a).

 

“Law”
means any statute, law, ordinance, regulation, rule, code, constitution, treaty, common law, Governmental Order, or other requirement
or rule of law of any Governmental Authority.

 

“Losses”
has the meaning set out in Section 14.01.

 

“Manufacturer”
has the meaning set out in Section 5.08.

 

“Master Distributor”
has the meaning set out in the preamble of this Agreement.

 

“Master Distributor
Contract” means any material contract or agreement to which Master Distributor is a party or to which any of its material
assets are bound.

 

“Master Distributor
Indemnitees” has the meaning set out in Section 14.01.

 

“Master Distributor’s
Trademarks” means all Trademarks owned by or licensed to Seller and set out in Schedule 3.

 

“Nonconforming
Good” means any good received by Master Distributor from Seller under a Purchase Order that: (a) is not a Good; (b) does
not conform to the UPC or SKU listed in the applicable Purchase Order; or (c) on visual inspection, Master Distributor reasonably
determines are otherwise Defective.

 

“Notice”
has the meaning set out in Section 17.04.

 

“Notify”
means to give Notice.

 

“Party”
has the meaning set out in the Preamble to this Agreement.

 

“Patents”
means all patents (including all reissues, divisionals, provisionals, continuations, and continuations-in-part, re-examinations,
renewals, substitutions, and extensions thereof), patent applications, and other patent rights and any other Governmental Authority-issued
indicia of invention ownership (including inventor’s certificates, petty patents, and patent utility models).

 

“Person”
means any individual, partnership, corporation, trust, limited liability entity, unincorporated organization, association, Governmental
Authority, or any other entity.

 

“Personnel”
means agents, employees, or subcontractors engaged or appointed by Seller or Master Distributor, as applicable.

 

“Platform”
means the software-as-a-service (SaaS) platform and related services including any documentation; modified versions of the Platform;
enhancements; derivations; upgrades; data tables; software code; any application program interface (“API”), device
driver interface, or any other interface developed by Seller and future versions of the Platform provided by Seller from time to
time in connection with the Goods.

 

    4

     

    

 

“Post-Term Resale
Period” has the meaning set out in Section 10.06.

 

“Price”
has the meaning set out in Section 5.02.

 

“Purchase Order”
means Master Distributor’s then-current standard form purchase order.

 

“Purchase Order
Transaction Terms” means any one or more of the following terms specified by Master Distributor in a Purchase Order pursuant
to Section 6.02: (a) the Goods to be purchased, including the, UPC or SKU, as applicable; (b) the quantity of each of the Goods
ordered; (c) the Delivery Date; (d) the unit Price for each of the Goods to be purchased; (e) the shipment date (f) the billing
address; and (g) the Delivery Location.

 

“Receiving Party”
has the meaning set out in Section 11.01.

 

“Renewal Term”
has the meaning set out in Section 10.02.

 

“Representatives”
means a Party’s Affiliates, employees, officers, directors, partners, shareholders, agents, attorneys, third-party advisors,
successors, and permitted assigns.

 

“Return Credit”
with respect to any Good means a credit to Master Distributor in an amount equal to the Price less any price protection credits,
but not including any early payment or prepayment discounts, if any.

 

“Seller”
has the meaning set out in the Preamble of this Agreement.

 

“Seller Contract”
means any material contract or agreement to which Seller is a party or to which any of its material assets are bound.

 

“Seller’s
Intellectual Property Rights” means all Intellectual Property Rights owned by or licensed to Seller.

 

“Seller’s
Trademarks” means all Trademarks owned by or licensed to Seller and set out in Schedule 4.

 

“Software”
means all software or programming provided by Seller that is integrated into, necessary for the proper operation of, or otherwise
related to the Goods; provided, however, that “Software” shall not include (a) the Platform and (b) any
API, device driver interface, or any other interface developed by Master Distributor from software owned by the Master Distributor
or any third party to integrate into or interface with the Platform or any Software.

 

“Subsidiary”
means any majority-owned direct or indirect subsidiary or Affiliate of Master Distributor.

 

    5

     

    

 

“Term”
has the meaning set out in Section 10.02.

 

“Territory”
has the meaning set forth in a Territory Addendum, which territory may be expanded from time to time by agreement of the parties
hereto as set forth in one or more Territory Addendums.

 

“Territory Addendum”
means each territory addendum executed by the Parties from time to time substantially in the form of Addendum A, which sets
forth, among other things, the Territory and Prices that shall be subject to this Agreement with respect to the Territory therein.
Upon execution of a Territory Addendum by each Party, such Territory Addendum shall be deemed to be incorporated into and a part
of this Agreement.

 

“Trademarks”
means all rights in and to U.S. and foreign trademarks, service marks, trade dress, trade names, brand names, logos, trade dress,
corporate names, and domain names and other similar designations of source, sponsorship, association or origin, together with the
goodwill symbolized by any of the foregoing, in each case whether registered or unregistered and including all registrations and
applications for, and renewals or extensions of, these rights and all similar or equivalent rights, or forms of protection in any
part of the world.

 

“Trade Secrets”
means all inventions, discoveries, trade secrets, business, and technical information and know-how, databases, data collections,
patent disclosures, and other confidential and proprietary information and all rights therein.

 

“Warranty Period”
has the meaning set out in the written warranty statement provided by Seller to End User as described in Section 13.01.

ARTICLE II

MASTER DISTRIBUTOR RIGHTS

  

 

Section 2.01 Exclusive
Appointment. Seller appoints Master Distributor to act as its exclusive distributor, subject to the Minimum Order Obligations
set forth in Addendum A and B, of Goods to Customers in each Territory during the Term and the Post-Term Resale Period in accordance
with the terms and conditions of this Agreement, and Master Distributor accepts such appointment. The above appointment made herein
establishes Master Distributor as the master distributor to Customers, including distributors, resellers, and End Users. Nothing
contained herein shall restrict Master Distributor from having the right to obtain or retain the rights to resell any other goods,
including goods that may compete with the Goods.

 

Section 2.02 Distributors,
Resellers, and Referrals. Master Distributor may appoint distributors and establish reseller and referral programs as it determines
appropriate in its sole and absolute discretion for the effective distribution of Goods under this Agreement. Master Distributor
shall bear all costs related to any reseller or referral programs.

    6

     

    

ARTICLE III

ORDER OF PRECEDENCE

 

Section 3.01 Order
of Precedence. The express terms and conditions contained in this Agreement, the Territory Addendums and the Purchase Order
Transaction Terms exclusively govern and control each Party’s respective rights and obligations regarding the purchase and
sale of the Goods, and the Parties’ agreement is expressly limited to such terms and conditions. Notwithstanding the foregoing,
if any terms and conditions contained in a Territory Addendum or Purchase Order conflict with any terms and conditions contained
in this Agreement, the order of precedence is: (a) the Purchase Order Transaction Terms of the relevant Purchase Order; (b) the
Territory Addendum; (c) the Agreement; and (d) the remaining non-conflicting terms of the relevant Purchase Order.

  

Section 3.02 Additional
or Different Terms. Without limiting the foregoing, any additional, contrary, or different terms contained in any Confirmation,
invoices, or other communications, and any other attempt to modify, supersede, supplement, or otherwise alter this Agreement, are
deemed rejected by Master Distributor and will not modify this Agreement or be binding on the Parties unless such terms have been
fully approved in a signed writing by authorized Representatives of both Parties.

ARTICLE IV

PROMOTION AND MARKETING

  

Section 4.01 Master
Distributor Performance Obligations. Master Distributor shall:

 

(a)  use
commercially reasonable efforts to market, promote, and resell the Goods to Customers;

 

(b)  maintain
a place or places of business, including adequate office, storage, and warehouse facilities and all other facilities as required
for Master Distributor to perform its duties under this Agreement;

 

(c)  purchase
and maintain a representative quantity of the Goods sufficient for and consistent with Master Distributor’s Customers’
sales needs; provided, however, that Master Distributor will not be responsible under this Agreement for any failure
to purchase or maintain a sufficient quantity of Goods caused by any act or omission by Seller or Manufacturer.

 

(d)  establish
and maintain a sales and marketing organization sufficient to develop the market potential for the sale of the Goods, and independent
sales representatives, a distribution organization, and facilities sufficient to make the Goods available for shipment by Master
Distributor to each Customer;

 

(e) either directly
or indirectly through all other resellers, require all End Users to agree to the Seller’s Terms of Use prior to accessing
the Platform;

 

(f) create and
launch marketing, promotion, and sales materials, campaigns, and programs to promote sales of the Goods to Customers; and

 

    7

     

    

 

(g) not
make any false or misleading representations or warranties to any Customer regarding Seller or the Goods.‌

 

Section 4.02 Seller
Performance Obligations. Seller shall:

 

(a) provide any
necessary information, material, and support as Master Distributor may reasonably request regarding the marketing, promotion, and
sale of Goods and shall notify Master Distributor promptly in the event of any material changes in such information;

 

(b)  provide
Master Distributor such marketing, promotional, sales, and technical literature and samples of Goods as Master Distributor may
reasonably consider necessary to assist with the promotion of the Goods;‌

 

(c) clearly
state that Master Distributor is the exclusive distributor of the Goods in the Territory (as long as Master Distributor has the
right to be exclusive) in all public-facing documentation relating to the Goods, including, without limitation, on Seller’s
website and in all marketing, promotional, and sales materials and press releases, except to the extent approved by advance written
consent of Master Distributor;

 

(d) allow Master
Distributor to participate in any marketing, promotion, and sales programs, campaigns, or events that Seller may make generally
available to its authorized distributors of Goods; and

 

(e) refer all
inquiries for the Goods that Seller receives directly to Master Distributor in each Territory.

ARTICLE V

AGREEMENT TO PURCHASE AND
SELL THE GOODS

 

Section 5.01 Terms
of the Sale. Seller shall make available and sell Goods to Master Distributor at the Prices and on the terms and conditions
set out in this Agreement. Subject to Seller’s rights under Addendum A, Master Distributor is not required to purchase
any minimum amount or quantity of the Goods.

 

Section 5.02 Price and
Payment Terms. The prices (“Prices”) and payment terms for Goods sold under this Agreement in each Territory
shall be set forth in a Territory Addendum to this Agreement. Except as set forth in a Territory Addendum, all Prices are exclusive
of all costs and expenses relating to packing, crating, boxing, transporting, loading and unloading, customs, taxes, tariffs and
duties, insurance, and any other similar financial contributions or obligations relating to the production, manufacture, sale,
and delivery of the Goods. All Prices are firm and are not subject to increase or decrease for any reason, including changes in
market conditions, increases in raw material, component, labor, or overhead costs or because of labor disruptions, or fluctuations
in production volumes, except by mutual written agreement by the Parties in accordance with Section 17.10.

 

 

    8

     

    

 

Section 5.04 Availability/Changes
in Goods. Seller shall:

 

(a)  provide
Master Distributor with six (6) months’ Notice before discontinuing a Good (the period of time from the delivery of Notice
through the end of the notice period, the “Last-Time Buy Period”) and Master Distributor may, at its sole discretion,
return any such discontinued Goods in its inventory in accordance with Section 7.04 or exercise its last-time buy rights under
Section 5.05;

 

(b) provide and
implement such updates to the Software and the Platform, and on such schedule, as reasonably necessary to maintain the full operation
and functionality of the Goods and the Platform in accordance with Section 13.01, and notify Master Distributor at least
seven (7) days before the date of any such update;

 

(c)  notify
Master Distributor at least thirty (30) days before the date that Seller introduces any new version of a Good, a new good similar
to a Good, or replacement of a Good and make such good available for resale by Master Distributor on or before the date it is first
introduced in the marketplace and the parties shall negotiate in good faith for the pricing and other terms of such new Good; and

 

(d) not change
any Goods or parts or accessories thereto, except as expressly contemplated in this Agreement, without fourteen (14) days’
Notice to Master Distributor.

  

The Parties may, upon mutual
agreement, add or make changes to the Goods listed on, or remove certain Goods from, Schedule 1, in each case without obligation
to modify or change any Goods previously delivered or to supply new Goods meeting earlier specifications.

 

Section 5.05 Last-Time
Buy. Master Distributor may, but will have no obligation to, make last-time buys during the Last-Time Buy Period of enough
Goods to fulfill its then-pending and Forecasted commitments to Customers. Seller shall use commercially reasonable efforts to
supply the last time buy and is in no event required to supply any Good if Seller reasonably determines that (a) the Good is infringing
or (b) the sale would violate any Law.

 

Section 5.06 Allocation.
Subject to Section 5.04, Seller shall employ its best efforts to ensure the production and maintenance of a sufficient Goods
inventory and production capacity to permit it to fill Master Distributor’s orders as set forth in any Forecast. In the event
of any shortage of Goods in Seller’s inventory, Seller shall, on order by Master Distributor, ship to Master Distributor
at least as many units of the Good as Seller ships to any other customer who has historically ordered similar quantities of Goods,
taking into account all customers’ purchase histories and industries, among other things. If any Good is subject to limited
availability at any time and Master Distributor has placed Purchase Orders for such Good, then either before or after the date
such Good becomes subject to limited availability, Seller agrees to Notify Master Distributor before filling any Purchase Order
for such Good, and Master Distributor has the right, in its sole discretion and without liability or penalty, to cancel any existing
Purchase Order for such Good as the Master Distributor’s sole and exclusive remedy.

 

    9

     

    

 

Section 5.07 Repurchase
by Seller.

 

(a) Mandatory
Repurchase. Upon Seller’s termination of this Agreement for any reason, Seller shall repurchase from Master Distributor
all Goods remaining in Master Distributor’s inventory as of the date of such termination for which Master Distributor, its
Affiliates, and any distributor or reseller have no outstanding commitments to any Customer.

 

(b) Optional
Repurchase. If requested by Seller, Master Distributor may, at its sole discretion, resell Goods to Seller, provided that such
repurchased Goods may only be used or sold by Seller outside the Territory.

 

(c) Repurchase
Price. In any case of repurchase and resale under this Section 5.07, the repurchase price will be the most recent acquisition
price paid to Seller by Master Distributor for the Goods.

 

Section 5.08 Certain
Remedies of Master Distributor. Without limiting any other remedies to which Master Distributor is entitled under this Agreement,
Master Distributor may, at its sole discretion:

  

(a) in the case
of (i) the bankruptcy or dissolution of Seller that is not dismissed within thirty (30) days, contract directly with the manufacturer(s)
of the Goods (the “Manufacturer”) to have Goods made, shipped, and delivered to Master Distributor in a manner
otherwise consistent with the terms of this Agreement; or

 

(b) in the case
that the Manufacturer either (i) fails to ship Goods to Master Distributor pursuant to the terms of the relevant Purchase Order
and this Agreement or (ii) ships Defective Goods to Master Distributor, pursue directly against the Manufacturer any applicable
right or remedy available to Master Distributor under this Agreement, at law, in equity, or otherwise.

ARTICLE VI

ORDER PROCEDURE

  

Section 6.01 Non-Binding
Forecasts. At least quarterly Master Distributor shall provide Seller with Forecasts. The Forecasts are for information purposes
only. Any Good quantities cited in or pursuant to this Agreement, except for quantities cited in a Purchase Order as firm, are
preliminary and non-binding only. Master Distributor makes no representation or warranty as to the quantity of Goods that it will
purchase, if any.

 

Section 6.02 Purchase
Order. Master Distributor shall issue Purchase Orders to Seller in written form via facsimile, email, or US mail.

‌

    10

     

    

 

Section 6.03 Acceptance
and Rejection of Purchase Orders. Seller shall confirm to Master Distributor the receipt of each Purchase Order issued hereunder
(each, a “Confirmation”) within three (3) Business Days following Seller’s receipt thereof by Notice via
facsimile, email, or US mail. Each Confirmation must reference Master Distributor’s Purchase Order number, confirm acceptance
of the Purchase Order or, solely if permitted under this Section 6.03, advise Master Distributor of Seller’s rejection or
modifications of such Purchase Order, the date of acceptance or rejection, and the basis for rejection and requested modification,
if applicable. If a modification is requested the parties shall negotiate in good faith any such reasonably requested modifications
by Seller. If Seller fails to issue a Confirmation within the time set forth in the first sentence of this Section 6.03, or otherwise
commences performance under such Purchase Order, Seller will be deemed to have accepted the Purchase Order. Master Distributor
may withdraw any Purchase Order prior to Seller’s acceptance (or deemed acceptance) thereof.

 

Section 6.04 Master
Distributor’s Right to Terminate Purchase Orders.  In addition to its rights under Section 10.03 to terminate all effective
Purchase Orders in connection with the termination of this Agreement, Master Distributor may, in its sole discretion, without liability
or penalty, terminate any Purchase Order with or without cause effective within ten (10) days from delivery of such Notice to Seller,
and any funds paid to Seller on account of such Purchase Order shall be refunded promptly to Master Distributor or credited towards
another Purchase Order of Master Distributor, as directed by Master Distributor.

 

Section 6.05 Effect
of Termination of Purchase Orders. If any Purchase Order is terminated under this Article VI or Article X, in
accordance with Master Distributor’s written direction, Seller shall immediately cease work and purchasing materials relating
to fulfilling the Purchase Order.

 

Section 6.06 Master
Distributor’s Right to Request Amendments to Purchase Orders.  Master Distributor may, upon reasonable Notice to Seller,
request changes to a Purchase Order. Within five (5) days after receiving such request, Seller shall Notify Master Distributor
of all Purchase Order Transaction Terms impacts as it shall determine in good faith. Master Distributor may then submit an amended
Purchase Order including the revised Purchase Order Transaction Terms set out in Seller’s Notice, which will be subject to
acceptance, modification or rejection under Section 6.03.

ARTICLE VII

SHIPMENT AND DELIVERY

  

Section 7.01 Shipment
and Delivery Requirements. Seller shall assemble, pack, mark, and ship Goods strictly in the quantities, by the methods, to
the Delivery Locations, and by the Delivery Dates, specified in the applicable Purchase Order or this Agreement. Delivery times
will be measured to the time that goods are actually received at the Delivery Location. Subject to Section 17.16, time,
quantity, and delivery to the Delivery Location are of the essence of this Agreement. If Seller fails to comply with any of its
delivery obligations under this Section 7.01, Master Distributor may, without limiting Master Distributor’s other rights
under this Agreement or applicable Law, in Master Distributor’s sole discretion and at Seller’s sole cost and expense:
(a) approve a revised Delivery Date or (b)  require expedited or premium shipment. Unless otherwise expressly agreed
by the Parties in writing, Seller may not make partial shipments of goods to Master Distributor.

 

    11

     

    

 

Section 7.02 Packaging
and Labeling. Seller shall properly pack, mark, and ship Goods as instructed by Master Distributor and otherwise in accordance
with applicable Law , and shall provide Master Distributor with shipment documentation showing the Purchase Order number, Seller’s
identification number for the subject Goods, the quantity of units in shipment, the number of cartons or containers in shipment,
Seller’s name, the bill of lading number, and the country of origin.

 

Section 7.03 Acceptance
of Goods. Master Distributor shall inspect the Goods within ten (10) days of receipt to determine if the if the Goods are Defective
and provide notice within such period to Seller of such Nonconforming Goods. If the Goods delivered under this Agreement are Nonconforming
Goods or Excess Goods, Master Distributor may, at its sole option:

 

		(a)	if such Goods are Nonconforming Goods within 10 days of receipt, either:

 

(i)  reject
Nonconforming Goods (including entire lots of Goods) and return such Nonconforming Goods to Seller, at Seller’s expense and
upon receipt of such NonConforming Goods, Seller shall refund all amounts paid for such NonConforming Goods plus any inspection,
testing, shipping, handling, and transportation charges paid by Master Distributor; or

  

(ii)  require
prompt correction or replacement of such Goods with Goods that are not Defective,

 

(b)  if
such Goods are Excess Goods within ten (10) days of receipt, reject such Excess Goods and return such NonConforming Goods to Seller,
at Seller’s expense and upon receipt of such NonConforming Goods, Seller shall for a refund, plus any inspection, testing,
shipping, handling, and transportation charges paid by Master Distributor..

 

If a refund is provided
by Seller, that shall be Master Distributors sole and exclusive remedy under this provision. Otherwise, in each case the exercise
by Master Distributor of any other rights available to Master Distributor under this Agreement or pursuant to applicable Law shall
not be limited. Master Distributor shall ship from any location, at Seller’s expense and risk of loss, the Nonconforming
Goods or Excess Goods to the nearest authorized Seller location. If Master Distributor exercises its option to replace Nonconforming
Goods, Seller shall, after receiving Master Distributor’s shipment of Nonconforming Goods, ship to Master Distributor, at
Seller’s expense and risk of loss, the replaced Goods to the Delivery Location in a timely manner. Master Distributor will
be deemed to have accepted delivered Goods if Master Distributor has not notified Seller that it is exercising its rights under
subparagraphs (a) or (b) of this Section 7.03 within five (5) days after the Goods are actually received at the Delivery
Location.

 

Section 7.04 Right
of Return. Seller understands that Master Distributor anticipates entering into a distribution agreement(s) with third party
distributor(s) (e.g., Synnex Corporation) (each a “Distributor”), and will grant the following rights to those Distributors,
which Seller acknowledges and agrees to accommodate:

 

    12

     

    

 

(a)            
Distributor may return one (1) monthly set of shipments to Master Distributor’s warehouse location of any Goods that
have been in Distributor’s inventory for over ninety (90) days (the “Eligible Products”), and Master Distributor
shall issue a credit memo to Distributor for such return. Master Distributor shall be responsible for freight, insurance, taxes,
duties and other costs of return and reshipment. No penalty or restocking charges shall apply, provided that the total value of
the returned shipment does not exceed 25% of the previous three months aggregate purchases by such Distributor from Master Distributor.

 

(b)            
Notwithstanding the foregoing, Distributor shall have the right, from the date of Master Distributor’s receipt of
the first purchase order from Distributor only and carrying forward for one hundred eighty (180) days, to return for credit to
Master Distributor without penalty or restocking charges, any Eligible Products. Upon request of Distributor, Master Distributor
shall issue a Return Material Authorization Number in writing for the Eligible Products. Eligible Products shall be returned to
Master Distributor and Master Distributor shall be responsible for freight, insurance, taxes, duties and other costs of return
and reshipment. Master Distributor shall issue a credit memo to Distributor for the invoice price of the Eligible Products. If
requested by Distributor, a Master Distributor representative shall be available to inspect returns at Distributor’s warehouse
within ten (10) business days of request.

 

(c)            
Seller shall promptly notify Master Distributor of the revision, enhancement or discontinuance of production of any Goods
in order for Master Distributor to notify each Distributor. Within sixty (60) days after the receipt of such notice by Distributor
and no more than sixty (60) days past the actual date of such revision, enhancement or discontinuance, Distributor may return to
Master Distributor any Goods covered by that notice, freight prepaid. The amount of such shipment shall not be considered as a
portion of that calculated under the guidelines stated in Section 7.04(a). Within thirty (30) days after receipt of the
shipment, Master Distributor shall issue a credit memo to Distributor for the invoice price paid by Distributor for such Goods.

 

(d)            
Seller shall allow Master Distributor to return, pursuant to Sections 7.04(a) through 7.04(c), any Goods that
have been opened by any Distributor or reseller, provided such Goods are complete and in substantially new condition.

 

    For
each Good returned to Master Distributor under this Section 7.04, once Seller verifies its quantity and quality, subject to Section
5.03, Seller and Master Distributor shall split the costs associated with such returns evenly.

 

Section 7.05 Title
and Risk of Loss. Title and risk of loss to Goods shipped under any Purchase Order passes to Master Distributor upon delivery
of the Goods to the Delivery Location. Title will transfer to Master Distributor even if Seller has not been paid for such Goods,
provided that Master Distributor will not be relieved of its obligation to pay for Goods in accordance with the terms hereof. Seller
will bear all risk of loss or damage regarding Goods until Master Distributor’s receipt of such Goods in accordance with
the terms hereof.

 

    13

     

    

 

Section 7.06 Price Decreases.
The Parties may, from time to time and solely upon mutual agreement, choose to decrease the list price for the Goods. In the event
of such price decrease, Seller shall promptly grant Master Distributor a corresponding price decrease and issue a credit memo for
an amount equal to fifty percent (50%) of the amount by which the price was decreased for (a) any affected Goods ordered or purchased
by Master Distributor, which either have not been shipped or delivered to Master Distributor, and (b) all Goods held in inventory
by Master Distributor on the date of such price reduction. Inventory purchased from Master Distributor and still on hand in its
Distribution Channel (i.e., its Distributors and resellers) shall be protected as stated above, with the credit for same flowing
from Seller, through Master Distributor, to Master Distributor’s Distribution Channel. The provisions of this Section
7.06 (a) will only take effect for products received by Master Distributor after June 30, 2020.

  

Section 7.07 Best Prices.
The Price for Goods, as amended from time to time, shall be at least as low as the lowest Price that seller offers to any of its
distributors and resellers of the Goods in the applicable Territory. If Seller sells any Goods to any of its distributors and resellers
of the Goods in the Territory at a price lower than the Price paid by Master Distributor, Seller shall immediately notify Master
Distributor of the same. Master Distributor shall immediately thereafter receive such lower Price on such Goods and Seller shall
issue a credit memo to Master Distributor for the difference between the Price paid by Master Distributor for all such Goods in
Master Distributor’s inventory, less such lower Price.

 

ARTICLE VIII

INSTALLATION, SUBSCRIPTIONS, AND TECHNICAL
SUPPORT

 

Section 8.01 Delivery
to Customer; Installation. Master Distributor shall, at its sole cost, deliver and perform physical installation and setup
of Goods and the Software purchased by an End User at the location designated by the End User.

 

Section 8.02 Subscription Services. Master Distributor and
Seller shall collaborate on establishing market pricing for Platform subscriptions to be sold to End Users in connection with the
Goods as set forth in the Territory Addendum. Master Distributor shall collect revenues attributable to Platform activation fees
and monthly subscription fees (“Subscription Revenues”) directly from End Users. Seller will be entitled to
the respective per-unit, one-time royalty fees set forth on the applicable Territory Addendum for each Platform activation and
Platform subscription that has been paid to Master Distributor (such net amount, the “Seller Royalty”). No later
than the thirtieth (30th) day after the end of each calendar quarter during the Term, Master Distributor shall calculate and remit
to Seller the Seller Royalty attributable to the prior calendar quarter. Notwithstanding the foregoing, if the Subscription Revenues
received by Master Distributor in any calendar month exceed $50,000, (a) Master Distributor shall calculate and remit to Seller
the Seller Royalty attributable to that month no later than the thirtieth (30th) day after the end of that month; and (b) for the
duration of the same calendar quarter, Master Distributor shall remit to Seller the Seller Royalty attributable to each remaining
calendar month of such calendar quarter no later than the thirtieth (30th) day after the end of each such remaining calendar month.
The Seller or, at its option, a certified public accountant paid by the Seller, during the Term and for two (2) years thereafter,
but in no event more than once annually, shall have the right to examine and audit such records of the Master Distributor at reasonable
times during normal business hours. All audit costs will be paid by the Seller if there is no underpayment of fees to the Seller. 
In the event such audit discloses that the fees previously paid or reported as due to the Seller have been underpaid or under-reported
as of the date of the audit, then Master Distributor shall immediately pay to Seller as applicable any difference between fees
paid and fees actually owed and all expenses incurred by Seller in performing the audit.

 

    14

     

    

  

Section 8.03 Ongoing
Support. Master Distributor shall perform ongoing technical support for End Users with respect to the Goods, the Software,
and the Platform in compliance with Service Level Agreement substantially in the form attached hereto as Exhibit A, to be
agreed upon by the parties within 30 days of this Effective Date, as it may be amended from time to time (the “SLA”);
provided, however, that Seller shall be solely responsible for, and shall promptly provide at its sole cost and expense,
all technical support with respect to the Goods and the Software for all issues that (a) render any such item fully or substantially
inoperable or inaccessible; (b) prevent any such item from functioning in accordance with the warranties in Section 13.01 in a
material way; or (c) prevent End Users from using any of the major features or functionalities of any such item(i.e., Tier 3 issues).
For purposes of this Section 8.03, Master Distributor and Seller, respectively, shall be responsible only for their respective
costs and expenses arising from their respective duties under this Section 8.03 and the SLA. Any fees received by Master
Distributor from End Users in connection with any installation, setup, maintenance, technical support, or other activities under
this Article VIII will be excluded from the Seller Royalty.

 

Section 8.04 Customer
Referrals. Seller shall refer and direct each End User of the Goods (whether such End User purchases Goods directly from Seller,
directly or indirectly through the Master Distributor or otherwise, and whether or not the End User is located in the Territory)
to the Master Distributor, so long as the Goods were originally purchased by a Customer or End User located or headquartered in
the Territory. Seller shall not solicit or attempt to solicit any such End User to use any software or goods other than the Goods
and the Platform.

 

Section 8.05 Seller
Role with Resellers in Territory. Seller may, from time to time and with full knowledge of Master Distributor, manage the relationship
with resellers of the Goods in the Territory, subject to approval of Master Distributor, at its sole discretion. In such cases,
Master Distributor or a Distributor shall process and manage the fulfillment of orders for Goods. Subject always to the agreement
of both Parties, situations where this would be deemed appropriate are limited to those where: (a) the Goods are sold by Seller
as a component of a broader solution; (b) a reseller from outside the Territory sells to a Customer whose headquarters are outside
the Territory, but whose final End User is located inside Territory and reseller desires Goods to be sourced in Territory; (c)
a reseller has a conflict of interest with Master Distributor; (d) reseller is a system integrator or value-add reseller with both
the desire and the ability to create a solution in which the Goods are a component and will desire Seller’s assistance, technical
expertise, and tools such as APIs or SDKs, to integrate with other systems; or (e) Master Distributor, at its sole discretion,
requests Seller to manage relationship with reseller directly. In any case above where Seller sells Goods directly to a reseller,
Customer, End User, or other Person, Master Distributor will be entitled to the Seller Royalty set forth on Addendum A for each
Good sold. Additionally, Master Distributor may perform Billing Support or Billing & Technical Support (both terms, as defined
in Schedule 2) for any Good sold pursuant to this Section 8.05, in which case Master Distributor will be entitled
to the fees set forth in Schedule 2 for each Good for which Master Distributor provides such services.

    15

     

    

ARTICLE IX

USE OF SELLER’S INTELLECTUAL
PROPERTY

 

Section 9.01 Use
of Seller’s Name and Trademarks. Master Distributor and its authorized independent sales representatives, distributors,
resellers, referral partners, successors, and assigns are authorized and licensed to:

 

(a)  use
Trademarks, service marks and trade names of Seller and any third party licensed by Seller in connection with marketing, promoting,
or reselling the Goods, as agreed to in writing by the Seller; and

 

(b) refer to
itself as an authorized distributor of the Goods without limitation in the Territory.

 

Section 9.02 Use of
Master Distributor’s Name and Trademarks. Seller is authorized and licensed to use Trademarks, service marks, and trade
names of Master Distributor solely in connection with marketing and promoting the Goods and fulfilling Seller’s obligations
under Section 4.02(c).

 

Section 9.03 Limited
Have Made Rights. Solely in connection with Master Distributor’s exercise of its rights under Section 5.08(a),
Master Distributor is granted a license to make and have made Goods under any Patent of Seller that is used in, implicated by,
or otherwise connected with the manufacturing and production of Goods.

ARTICLE X

TERM; TERMINATION

 

Section 10.01 Initial
Term. The term of this Agreement shall be deemed to have commenced on April 20, 2020 and will continue for a period of twelve
(12) months thereafter, unless and until earlier terminated as provided under this Agreement or applicable Law (the “Initial
Term”).

 

Section 10.02 Renewal
Term. Upon expiration of the Initial Term, this Agreement automatically renews for additional successive twelve (12) month
terms unless and until (a) Master Distributor provides Notice of nonrenewal at least sixty (60) days before the end of the then-current
term (a) Seller provides Notice of nonrenewal at least six (6) months before the end of the then-current term or (b) earlier terminated
as provided under this Agreement or applicable Law (each, a “Renewal Term”, and together with the Initial Term,
the “Term”). If the Term is renewed for any Renewal Term(s) pursuant to this Section 10.02, the terms
and conditions of this Agreement during each such Renewal Term are the same as the terms in effect immediately prior to such renewal,
subject to any change agreed to by the Parties in accordance with Section 17.07. If Master Distributor or Sellers provides
timely Notice of its intent not to renew this Agreement, then, subject to Section 10.01, unless earlier terminated in accordance
with its terms, this Agreement terminates on the expiration of the then-current Term.‌

 

    16

     

    

 

Section 10.03 Master
Distributor’s Right to Terminate the Agreement. Master Distributor may terminate this Agreement (including all related
Purchase Orders in accordance with Section 6.04), on Notice to Seller:

 

(a)    except
as otherwise specifically provided under this Section 10.03, if Seller is in material breach of any representation, warranty, or
covenant of Seller under this Agreement and either the breach cannot be cured or, if the breach can be cured, it is not cured by
Seller within a commercially reasonable period of time under the circumstances, in no case exceeding fifteen (15) days following
Seller’s receipt of Notice of such breach;

  

(b)  if
Seller:

 

(i)  files
or has filed against it, a petition for voluntary or involuntary bankruptcy, or otherwise becomes subject, voluntarily or involuntarily,
to any proceeding under any domestic or foreign bankruptcy or insolvency Law and such case is not dismissed within 30 days;

 

(ii)  seeks
reorganization, arrangement, adjustment, winding-up, liquidation, dissolution, composition, or other relief with respect to it
or its debts;

 

(iii)  makes
or seeks to make a general assignment for the benefit of its creditors; or

 

 (iv)  applies
for or has a receiver, trustee, custodian, or similar agent appointed by order of any court of competent jurisdiction to take charge
of or sell any material portion of its property or business;

 

(c)  in
the event of a Force Majeure Event affecting Seller’s performance of this Agreement for more than thirty (30) consecutive
days;

 

(d)  if,
without obtaining Master Distributor’s prior written consent, (i) Seller sells, leases or exchanges a material portion of
Seller’s assets, (ii) Seller merges or consolidates with or into another Person, or (iii) a change in Control of Seller occurs,
unless in the case of a merger or consolidation of Seller with another Person, Seller is the surviving entity and has a net worth
greater than or equal to its net worth immediately prior to the merger or consolidation; or

  

(e)  at
its option and for any reason upon ninety (90) days’ written notice to Seller.

 

    17

     

    

 

Any termination under this
Section 10.03 is effective on Seller’s receipt of Master Distributor’s Notice of termination or any later date set
out in the Notice.

 

Section 10.04 Seller’s
Right to Terminate for Cause. Seller may terminate this Agreement (including all related Purchase Orders) on Notice to Master
Distributor:

 

(a)  except
as otherwise specifically provided under this Section 10.04, if Master Distributor is in material breach of any representation,
warranty, or covenant of Master Distributor under this Agreement, and either the breach cannot be cured or, if the breach can be
cured, it is not cured by Master Distributor within a commercially reasonable period of time (in no case exceeding fifteen (15)
days after Master Distributor’s receipt of Notice of such breach).

 

(b)  if
Master Distributor:

 

(i)  
  files or has filed against it, a petition for voluntary or involuntary bankruptcy or otherwise becomes subject, voluntarily
or involuntarily, to any proceeding under any domestic or foreign bankruptcy or insolvency Law, that is not dismissed within 30
days;

 

(ii)  seeks
reorganization, arrangement, adjustment, winding-up, liquidation, dissolution, composition, or other relief with respect to it
or its debts;

 

(iii)  makes
or seeks to make a general assignment for the benefit of its creditors;

 

(iv)  applies
for or has appointed a receiver, trustee, custodian, or similar agent appointed by order of any court of competent jurisdiction
to take charge of or sell any material portion of its property or business;

 

(c)  in
the event of a Force Majeure Event affecting Master Distributor’s performance of this Agreement for more than thirty (30)
consecutive days; or

 

(d)  if,
without obtaining Seller’s prior written consent, which shall not be unreasonably withheld, (i) Master Distributor sells,
leases or exchanges a material portion of Master Distributor’s assets, (ii) Master Distributor merges or consolidates with
or into another Person, or (iii) a change in Control of Master Distributor’s occurs, unless in the case of a merger or consolidation
of Master Distributor with another Person, Master Distributor is the surviving entity and has a net worth greater than or equal
to its net worth immediately prior to the merger or consolidation.

  

Any termination under this
Section 10.04 is effective on Master Distributor’s receipt of Seller’s Notice of termination or any later date set
out in the Notice.

 

    18

     

    

 

Section 10.05 Effect
of Expiration or Termination.

 

(a)  Unless
Master Distributor directs otherwise, any termination under Section 10.03 automatically terminates all related Purchase Orders
under Article VI. Unless Seller directs otherwise, any termination under Section 10.04 automatically terminates all related
Purchase Orders under Article VI.

 

(b)  Upon
the expiration or earlier termination of this Agreement:

 

(i)  each
Party shall promptly return to the other Party or destroy all documents and tangible materials (and any copies thereof) containing,
reflecting, incorporating, or based on the other Party’s Confidential Information;

 

(ii)  each
Party shall promptly permanently erase all of the other Party’s Confidential Information from its computer systems, except
for copies that are maintained as archive copies on its disaster recovery and/or information technology backup systems. Each Party
shall destroy any such copies upon the normal expiration of its backup files; and

 

(iii)  each
Party shall promptly certify in writing to the other Party that it has complied with the requirements of this clause.

 

(c)  The
Party terminating this Agreement, or in the case of the expiration of this Agreement, each Party, shall not be liable to the other
Party for any damage of any kind (whether direct or indirect) incurred by the other Party by reason of the expiration or earlier
termination of this Agreement. Termination of this Agreement will not constitute a waiver of any of the terminating Party’s
rights or remedies under this Agreement, at law, in equity, or otherwise.

 

(d) Notwithstanding
the provisions of Section 17.03, in the case that this Agreement is terminated for any reason, the Parties shall continue
to perform such obligations and provide such services and all fees are paid for such Goods shipped and services performed for the
fees set forth under this Agreement as necessary to ensure that the Platform and the Software continue to operate for the life
of the respective Goods in same condition as if this Agreement were still fully in effect.

 

Section 10.06 Post-Term
Resale Period. On the expiration or earlier termination of this Agreement, Master Distributor may, in accordance with the
applicable terms and conditions of this Agreement, sell off its existing inventories of Goods for a period of six (6) months following
the last day of the Term (the “Post-Term Resale Period”)

ARTICLE XI

CONFIDENTIALITY

 

Section 11.01 Scope
of Confidential Information. From time to time during the Term, either Party (as the “Disclosing Party”)
may disclose or make available to the other Party (as the “Receiving Party”) information about its business
affairs, goods and services, Forecasts, confidential information, and materials comprising or relating to Intellectual Property
Rights, Trade Secrets, third-party confidential information, and other sensitive or proprietary information; such information,
whether orally or in written, electronic, or other form or media, and whether or not marked, designated, or otherwise identified
as “confidential” constitutes “Confidential Information” hereunder. Confidential Information excludes
information that, at the time of disclosure and as established by documentary evidence:

 

    19

     

    

 

(a)  is
or becomes generally available to and known by the public other than as a result of, directly or indirectly, any breach of this
Article XI by the Receiving Party or any of its Representatives;

 

(b)  is
or becomes available to the Receiving Party on a non-confidential basis from a third-party source, provided that such third party
is not and was not prohibited from disclosing such Confidential Information;

 

(c)  was
known by or in the possession of the Receiving Party or its Representatives before being disclosed by or on behalf of the Disclosing
Party; or

 

(d)  was
or is independently developed by the Receiving Party without reference to or use of, in whole or in part, any of the Disclosing
Party’s Confidential Information.

 

Section 11.02 Protection
of Confidential Information. The Receiving Party shall:

 

(a)  protect
and safeguard the confidentiality of the Disclosing Party’s Confidential Information with at least the same degree of care
as the Receiving Party would protect its own Confidential Information, but in no event with less than a commercially reasonable
degree of care;

 

(b)  not
use the Disclosing Party’s Confidential Information, or permit it to be accessed or used, for any purpose other than to exercise
its rights or perform its obligations under this Agreement; and

 

(c)  not
disclose any such Confidential Information to any Person, except:

 

(i)  to
the Receiving Party’s Representatives who need to know the Confidential Information to assist the Receiving Party, or act
on its behalf, to exercise its rights or perform its obligations under this Agreement;

 

(ii)  pursuant
to applicable Law, provided that the Receiving Party shall first provide the Disclosing Party with: (A) prompt Notice of such requirement
so that the Disclosing Party may seek, at its sole cost and expense, a protective order, or other remedy; and (B) reasonable assistance,
at the Disclosing Party’s sole cost and expense, in opposing such disclosure or seeking a protective order or other limitations
on disclosure; or

 

    20

     

    

 

(iii) pursuant
to Master Distributor’s obligations under the applicable securities Laws and the regulations of any exchange on which Master
Distributor’s securities are traded.

 

The Receiving Party shall
be responsible for any breach of this Article XI caused by any of its Representatives. The provisions of this Article XI shall
survive termination or expiration of this Agreement for any reason for a period of two (2) years after such termination or expiration.
On the expiration or earlier termination of this Agreement, the Receiving Party and its Representatives shall, pursuant to Section
10.05(b), promptly return or destroy all Confidential Information and copies thereof that it has received under this Agreement.

ARTICLE XII

REPRESENTATIONS AND WARRANTIES

  

Section 12.01 Seller’s
Representations and Warranties. Seller represents, warrants, and covenants to Master Distributor that:

 

(a)  it
is a limited liability company organized, validly existing, and in good standing in the jurisdiction of its organization/formation;

 

(b)  it
is duly qualified to do business and is in good standing in every jurisdiction in which such qualification is required or purposes
of this Agreement, except where the failure to be so qualified, in the aggregate, would not reasonably be expected to adversely
affect its ability to perform its obligations under this Agreement;

 

(c)  it
has the full right, power, and authority to enter into this Agreement, to grant the rights and licenses granted under this Agreement,
and to perform its obligations under this Agreement;

 

(d)  the
execution of this Agreement by its Representative whose signature is set forth at the end hereof has been duly authorized by all
necessary action of Seller;

 

(e) the execution,
delivery, and performance of this Agreement by Seller will not violate, conflict with, require consent under, or result in any
breach or default under:

 

(i) any of Seller’s
organizational documents;

 

(ii) any applicable
Law; or

 

(iii) with or without
notice or lapse of time or both, the provisions of any Seller Contract;

  

(f)  when
executed and delivered by each of Master Distributor and Seller, this Agreement will constitute the legal, valid, and binding obligation
of Seller, enforceable against Seller in accordance with its terms, except as may be limited by any applicable bankruptcy, insolvency,
reorganization, moratorium, or similar laws and equitable principles related to or affecting creditors’ rights generally
or the effect of general principles of equity; and

 

    21

     

    

 

(g)  it
is now and at all times will remain in material compliance with all Laws of the Territory and Seller Contracts applicable to this
Agreement, the Goods, the Software, the Platform, and the operation of its business.

 

EXCEPT AS EXPRESSLY
SET FORTH IN THIS SECTION 12.01 and 13.01, Seller EXPRESSLY DISCLAIMS ALL WARRANTIES AND REPRESENTATIONS, EXPRESS OR IMPLIED, CONCERNING
THE GOODS, SERVICES AND DELIVERABLES, INCLUDING, WITHOUT LIMITATION, ANY IMPLIED WARRANTIES OF FITNESS FOR A PARTICULAR PURPOSE,
MERCHANTABILITY OR OTHERWISE ARE HEREBY DISCLAIMED.

 

Section 12.02 Master
Distributor’s Representations and Warranties. Master Distributor represents, warrants, and covenants to Seller that:

 

(a)  it
is a corporation duly organized, validly existing, and in good standing in the jurisdiction of its incorporation;

 

(b)  it
is duly qualified to do business and is in good standing in every jurisdiction in which such qualification is required for purposes
of this Agreement, except where the failure to be so qualified, in the aggregate, would not reasonably be expected to adversely
affect its ability to perform its obligations under this Agreement;

 

(c)  it
has the full right, power and authority to enter into this Agreement, to grant the rights and licenses granted under this Agreement,
and to perform its obligations under this Agreement;

 

(d)  the
execution of this Agreement by its Representative whose signature is set forth at the end hereof has been duly authorized by all
necessary action of Master Distributor;

 

(e)  the
execution, delivery, and performance of this Agreement by Master Distributor will not violate, conflict with, require consent under,
or result in any breach or default under:

 

(i)  any
of Master Distributor’s organizational documents;

 

(ii)  any
applicable Law; or

  

(iii)  with
or without notice or lapse of time or both, the provisions of any Master Distributor Contract; and

 

(f)  when
executed and delivered by each of Seller and Master Distributor, this Agreement will constitute the legal, valid, and binding obligation
of Master Distributor, enforceable against Master Distributor in accordance with its terms, except as may be limited by any applicable
bankruptcy, insolvency, reorganization, moratorium, or similar laws and equitable principles related to or affecting creditors’
rights generally, or the effect of general principles of equity.

 

    22

     

    

 

 

(g)  it
is now and at all times will remain in material compliance with all Laws of the Territory and Master Distributor Contracts applicable
to this Agreement and the operation of its business.

 

(h)  no
goods, nor the manufacture, marketing, sale, and use of the goods, or software, nor anything in or contemplated by this Agreement,
used in conjunction with the Software, Platform or the Goods infringes on any third-party Intellectual Property Rights.

ARTICLE XIII

PRODUCT WARRANTIES

  

Section 13.01 Product
Warranties. Seller warrants to Master Distributor that:

 

(a)  for
a period of twelve (12) months from the date of initial delivery of the Good to any End User (the “Warranty Period”),
such Good will conform with the specifications and documentation provided with the Good and will be free from defects in material
and workmanship;

 

		(a)	Goods are free of defects in design;

 

(c)  no
claim, lien, or action exists or is threatened against Seller that would interfere with the marketing, use, or sale of the Goods;

 

(d)  no
Goods, nor the manufacture, marketing, sale, and use of the Goods, the Software, the Platform, nor anything in or contemplated
by this Agreement, infringes on any third-party Intellectual Property Rights;

 

(e)  Master
Distributor will receive good and valid title to the Goods, free and clear of all encumbrances and liens of any kind;

 

(f)  the
Goods are new and do not contain used or reconditioned parts;

 

(h) the
Software and the Platform contain no harmful code, intentionally placed by Seller into the Software or Platform;

 

(i)  it
has disclosed to Master Distributor in writing the existence of any third-party code, including open source code, that is included
in or is provided in connection with the Goods, the Software, and the Platform, and that Seller and the Goods, the Software, and
the Platform are in compliance with all licensing agreements applicable to such third-party code;

 

    Master
Distributor may pass-through to End Users all warranties granted by Seller under this Agreement.

 

    23

     

    

 

Section 13.02 Remedies
for Breach of Warranties. During the Warranty Period, if Goods do not comply with the warranties in this Agreement, in addition
to other remedies available at Law or in this Agreement, Seller shall, at Seller’s discretion, repair or replace such Defective
Goods. For such Goods, Master Distributor shall ship, at Master Distributor’s expense and risk of loss, such allegedly Defective
Goods to the nearest authorized Seller location (Hong Kong) and Seller will, at Seller’s expense and risk of loss, return
any repaired or replaced Good to a location designated by Master Distributor in a timely manner.

 

Section 13.03 Recalls.
If any Goods sold to Master Distributor are Defective and a recall campaign is necessary, only Seller may implement such recall
campaign Without prejudice to Master Distributor’s rights under Section 13.01 and Section 13.02, if a recall campaign is
implemented, at Master Distributor’s option and Seller’s sole cost, Seller shall promptly either repair or replace,
or credit or refund Prices for, all such returned Goods .

ARTICLE XIV

INDEMNIFICATION

  ‌

Section 14.01 Seller
Indemnification.

		(a)	Subject to the terms and conditions of this Agreement, including those set forth in Section
14.02, Seller shall indemnify, defend, and hold harmless Master Distributor and its Representatives, officers, directors, employees,
agents, Affiliates, distributors, resellers, referral partners (and, for each of the foregoing that is an entity, their respective
officers, directors, employees, and agents), successors, and permitted assigns (collectively, “Master Distributor Indemnitees”)
against any and all losses, damages, liabilities, deficiencies, claims, actions, judgments, settlements, interest, awards, penalties,
fines, costs, or expenses of whatever kind, including attorneys’ fees, fees and the costs of enforcing any right to indemnification
under this Agreement, and the cost of pursuing any insurance providers, incurred by a Master Distributor Indemnitee or End User
or awarded against a Master Distributor Indemnitee or End User (collectively, “Losses”), relating to, arising
out of, or resulting from any Claim of a third party alleging: (a)  breach or non-fulfillment of any representation,
warranty, or covenant this Agreement by Seller or Seller’s Personnel; (b)  any negligent or more culpable act or
omission of Seller or its Personnel (including any recklessness or willful misconduct) in connection with the performance of its
obligations under this Agreement; (c)  any bodily injury, death of any Person, or damage to real or tangible personal
property caused by the willful or negligent acts or omissions of Seller or its Personnel; or (d) any failure by Seller or
its Personnel to comply with any applicable Laws in the Territory.

 

    24

     

    

 

		(b)	Subject to the terms and conditions of this Agreement, including those set forth in Section
14.02, Master Distributor shall indemnify, defend, and hold harmless Seller and its Representatives, officers, directors, employees,
agents, Affiliates, distributors, resellers, referral partners (and, for each of the foregoing that is an entity, their respective
officers, directors, employees, and agents), successors, and permitted assigns (collectively, “Seller Indemnitees”)
against any and all Losses, relating to, arising out of, or resulting from any Claim of a third party alleging: (a)  breach
or non-fulfillment of any representation, warranty, or covenant this Agreement by Master Distributor or Master Distributor’s
Personnel; (b)  any negligent or more culpable act or omission of Master Distributor or its Personnel (including any
recklessness or willful misconduct) in connection with the performance of its obligations under this Agreement; (c)  any
bodily injury, death of any Person, or damage to real or tangible personal property caused by the willful or negligent acts or
omissions of Master Distributor or its Personnel; or (d) any failure by Master Distributor or its Personnel to comply with
any applicable Laws in the Territory.

 

Section 14.02 Exceptions
and Limitations on Indemnification. Notwithstanding anything to the contrary in this Agreement, an indemnifying party is not
obligated to indemnify or defend the indemnified party’s Indemnitee against any claim (whether direct or indirect) if such
claim or corresponding Losses directly result from the indemnifying party Indemnitee’s or its Personnel’s: (a)  gross
negligence or more culpable act or omission (including recklessness or willful misconduct); or (b)  bad faith failure
to comply with any of its obligations set forth in this Agreement.

 

Section 14.03 Seller
Intellectual Property Indemnification. Subject to the terms and conditions of Section 14.04, Seller shall defend (at Seller’s
option), hold harmless, and indemnify Master Distributor Indemnitees from and against all Losses arising out of any third-party
Claim alleging that any of the Goods, Software, Platform, or Master Distributor’s receipt or use thereof infringes any Intellectual
Property Right; provided that the indemnification obligations under the foregoing clause shall not apply to infringement
actions or claims to the extent that such actions or claims are based on or result from: (i) the use of any Goods, Software, Platform
in violation of the terms of this Agreement or the Seller’s Terms of Use for the Goods, Software or Platform, (ii) any alteration
or modification of the Goods, Software or Platform by any person other than by, on behalf or at the direction of Seller or its
authorized agent, and provided the loss in question would not have occurred, in whole or in part, but for such unauthorized alteration
or modification, (iii) any combination, operation or use of the Goods, Software or Platform with equipment or software not supplied,
recommended or approved in writing by Seller, unless such use is performed by, on behalf or at the direction of Developer or its
affiliates, and provided the loss in question would not have occurred, in whole or in part, but for such unsanctioned use, or (iv)
compliance with information, directions, specifications or materials provided by Master Distributor or other sub distributor or
reseller. In addition, if such a Claim is or is likely to be made, Seller shall, at its own expense, exercise the following as
determined in the Seller’s discretion: (a) obtain for Master Distributor and its End Users the right to continue to
use and sell the Goods consistent with this Agreement; (b) modify the Goods, Software, or Platform, as applicable, so they
are non-infringing and in compliance with this Agreement; (c) replace the Goods, Software, or Platform with non-infringing
ones that comply with this Agreement; or (d)   accept the cancellation and return (at Seller’s expense) of infringing
Goods, Software, or Platform without Master Distributor or End Users having any cancellation liability and refund to Master Distributor
and End Users any amount paid for such infringing Goods. The foregoing shall be Master Distributor’s sole remedy for an infringement
claim of Goods, Software, Platform, or Master Distributor’s receipt or use thereof. If the Goods, Software, or Platform,
or any part thereof, become, or in Seller’s opinion are likely to become, subject to a Claim that qualifies for intellectual
property indemnification coverage under this Section 14.03, Seller shall, at its sole option and expense, Notify Master Distributor
and End Users to cease using such Goods. Master Distributor shall Notify Seller of third-party Claims against Master Distributor
and reasonably cooperate in the investigation, settlement, and defense of such Claims at Seller’s expense.

 

    25

     

    

 

Section 14.04 Exceptions
to Seller’s Intellectual Property Indemnification. Notwithstanding anything to the contrary in this Agreement, Seller
is not obligated to indemnify or defend any Master Distributor Indemnitee against any claim under Section 14.03 if such claim or
corresponding Losses arise out of or result from the circumstances described in Section 14.02(a) or Section 14.02(b).

 

 

ARTICLE XV

LIMITATION OF LIABILITY

  

Section 15.01 No Liability
for Consequential or Indirect Damages. EXCEPT FOR LIABILITY FOR INDEMNIFICATION, LIABILITY FOR BREACH OF CONFIDENTIALITY,
OR LIABILITY FOR INFRINGEMENT OR MISAPPROPRIATION OF INTELLECTUAL PROPERTY RIGHTS, NEITHER PARTY NOR ITS REPRESENTATIVES SHALL
BE LIABLE FOR CONSEQUENTIAL, INDIRECT, INCIDENTAL, SPECIAL, EXEMPLARY, PUNITIVE, OR ENHANCED DAMAGES, ARISING OUT OF OR RELATING
TO ANY BREACH OF THIS AGREEMENT, WHETHER OR NOT THE POSSIBILITY OF SUCH DAMAGES HAS BEEN DISCLOSED IN ADVANCE BY MASTER DISTRIBUTOR
OR COULD HAVE BEEN REASONABLY FORESEEN BY SUCH PARTY, REGARDLESS OF THE LEGAL OR EQUITABLE THEORY (CONTRACT, TORT, OR OTHERWISE)
UPON WHICH THE CLAIM IS BASED, AND NOTWITHSTANDING THE FAILURE OF ANY AGREED OR OTHER REMEDY OF ITS ESSENTIAL PURPOSE. EXCEPT
FOR LIABILITY FOR INDEMNIFICATION, LIABILITY FOR BREACH OF CONFIDENTIALITY, OR LIABILITY FOR INFRINGEMENT OR MISAPPROPRIATION
OF INTELLECTUAL PROPERTY RIGHTS, NEITHER Under no circumstances whatsoever will EITHER
PARTY be liable for any matter or matters that will exceed in the aggregate the amounts paid or payable for goods shipped or services
performed to Seller the PRECEDING 12 months.

ARTICLE XVI

INSURANCE OBLIGATIONS

 

Section 16.01 Insurance.
Without limiting Seller’s indemnification obligations under this Agreement, during the Term, Seller shall, at its own expense,
maintain and carry in full force and effect at least the following types of insurance coverage, subject to the requirements set
forth in Section 16.02: (a)  commercial general liability with limits of at least million dollars ($1,000,000) per occurrence,
including bodily injury, property damage covering the Goods, and advertising liability, which policy will also include contractual
liability coverage insuring the activities of Seller under this Agreement; (b)  worker’s compensation with limits
no less than the minimum amount required by applicable law; and (c)  umbrella (excess) liability for the coverage in
Section 16.01(a), with limits of one million dollars ($1,000,000) per occurrence.

 

    26

     

    

 

Section 16.02 Insurance
Contract Requirements. Seller shall ensure that all insurance policies required pursuant to Section 16.01: (a) are issued
by insurance companies reasonably acceptable to Master Distributor; (b) provide that such insurance carriers give Master Distributor
at least thirty (30) days’ prior Notice of cancellation or non-renewal of policy coverage, provided that, prior to such cancellation,
Seller has new insurance policies in place that meet the requirements of this Article XVI; (c) provide that such insurance
be primary insurance and any similar insurance in the name of and/or for the benefit of Seller shall be excess and non-contributory;
(d) name Master Distributor and Master Distributor’s Affiliates, including, in each case, all successors and permitted
assigns, as additional insureds; and (e) waive any right of subrogation of the insurers against Master Distributor or any
of its Affiliates.

 

Section 16.03 Insurance
Certificates. On Master Distributor’s reasonable request, Seller shall provide Master Distributor with copies of the
certificates of insurance and policy endorsements for all insurance coverage required by this Article XVI, and shall not
do anything to invalidate such insurance. This Section 16.03 shall not be construed in any manner as waiving, restricting, or limiting
the liability of either Party for any obligations imposed under this Agreement (including but not limited to, any provisions requiring
a party hereto to indemnify, defend, and hold the other harmless under this Agreement).

ARTICLE XVII

MISCELLANEOUS

 

Section 17.01 Further
Assurances. Upon a Party’s reasonable request, the other Party shall, at its sole cost and expense, execute and deliver
all such further documents and instruments, and take all such further acts, necessary to give full effect to this Agreement.

 

Section 17.02 Entire
Agreement. Subject to Article III, this Agreement, including and together with any related exhibits, schedules, attachments,
and appendices, together with the Purchase Orders, constitutes the sole and entire agreement of the Parties with respect to the
subject matter contained herein and therein, and supersedes all prior and contemporaneous understandings, agreements, representations,
and warranties, both written and oral, regarding such subject matter.

 

Section 17.03 Survival.
Subject to the limitations and other provisions of this Agreement: (a) the representations and warranties of the Parties contained
herein shall survive the expiration or earlier termination of this Agreement; and (b) Articles VIII, IX, XI,
XIII, XIV, XV and Sections 10.05, 10.06, 17.04, 17.13, and 17.14 of this
Agreement, as well as any other provision that, in order to give proper effect to its intent, should survive such expiration or
termination, shall survive the expiration or earlier termination of this Agreement. All other provisions of this Agreement shall
not survive the expiration or earlier termination of this Agreement.

 

Section 17.04 Notices.
All notices, requests, consents, claims, demands, waivers, and other communications hereunder (each, a “Notice”,
and with the correlative meaning, “Notify”) shall be in writing and shall be deemed to have been given: (a)
when delivered by hand (with written confirmation of receipt); (b) when received by the addressee if sent by a nationally recognized
overnight courier (return receipt requested); (c) on the date sent by email of a PDF document (with confirmation of transmission)
if sent during normal business hours of the recipient, and on the next business day if sent after normal business hours of the
recipient; or (d) on the third (3rd) day after the date mailed, by certified or registered first class mail, return receipt requested,
postage prepaid. Such communications must be sent to the respective parties at the following addresses (or at such other address
for a party as shall be specified in a notice given in accordance with this Section 17.04.

 

    27

     

    

 

	
        Notice to Master Distributor:

         
	 	
        Creative Realities, Inc.

        13100 Magisterial Drive, Suite 100

        Louisville, KY 40223

        Attn: Will Logan, Chief Financial Officer

	 	 	 
	 	 	E-mail: will.logan@cri.com
	 	 	 
	 	 	 
	With a copy (which shall not constitute notice) to:	 	
         

        Maslon LLP

	 	 	
        3300 Wells Fargo Center

        90 South 7th Street

	 	 	Minneapolis, MN 55402
	 	 	Attn: Bradley Pederson
	 	 	 
	 	 	E-mail: bradley.pederson@maslon.com
	 	 	 
	
        Notice to Seller:

         
	 	
        InReality LLC

        N4372 Snyder Lake Road

        Neillsville, WI 54456

	 	 	
         

        E-mail:

        ron.levac@inreality.com

    

Section 17.05 Headings.
The headings in this Agreement are for reference only and do not affect the interpretation of this Agreement.

 

Section 17.06 Severability.
If any term or provision of this Agreement is invalid, illegal, or unenforceable in any jurisdiction, such invalidity, illegality,
or unenforceability shall not affect any other term or provision of this Agreement or invalidate or render unenforceable such term
or provision in any other jurisdiction. Upon a determination that any term or provision is invalid, illegal, or unenforceable,
this Agreement shall be modified to effect the original intent of the Parties as closely as possible in order that the transactions
contemplated hereby be consummated as originally contemplated to the greatest extent possible.

 

Section 17.07 Amendment
and Modification. No amendment to or modification of this Agreement or any Purchase Order is effective unless it is in writing
and signed by an authorized Representative of each Party.

 

    28

     

    

 

Section 17.08 Waiver.
No waiver by any Party of any provision of this Agreement or any Purchase Order shall be effective unless it is in writing and
signed by the Party waiving its right. Any waiver authorized on one occasion is effective only in that instance and only for the
purpose stated, and does not operate as a waiver on any future occasion. None of the following constitutes a waiver or estoppel
of any right, remedy, power, privilege, or condition arising from this Agreement: (i)  any failure or delay in exercising
any right, remedy, power, or privilege or in enforcing any condition under this Agreement; or (ii)  any act, omission,
or course of dealing between the Parties.‌

 

Section 17.09 Cumulative
Remedies. All rights and remedies provided in this Agreement are cumulative and not exclusive, and the exercise by either Party
of any right or remedy does not preclude the exercise of any other rights or remedies that may now or subsequently be available
at law, in equity, by statute, in any other agreement between the Parties, or otherwise.

 

Section 17.10 Assignment.
Except as otherwise set forth in Section 2.02, neither Party may assign any of its rights or delegate any of its obligations
under this Agreement without the other Party’s prior written consent. Any purported assignment or delegation in violation
of this Section 17.10 shall be null and void.

 

‌Section 17.11 Successors
and Assigns. This Agreement is binding on and inures to the benefit of the Parties to this Agreement and their respective permitted
successors and permitted assigns.

 

Section 17.12 No Third-Party
Beneficiaries. Subject to Section 17.12(b), this Agreement benefits solely the Parties to this Agreement and their respective
permitted successors and assigns and nothing in this Agreement, express or implied, confers on any other Person any legal or equitable
right, benefit, or remedy of any nature whatsoever under or by reason of this Agreement.

  

Section 17.13 Dispute
Resolution. Any dispute, controversy, or claim arising out of or relating to this Agreement, or the breach, termination or
invalidity hereof (each, a “Dispute”), shall be submitted for negotiation and resolution to the Chief Executive
Officer of Seller (or to such other person of equivalent or superior position designated by Seller in a written Notice to Master
Distributor) and the Chief Executive Officer of Master Distributor (or to such other person of equivalent or superior position
designated by Master Distributor in a written Notice to Seller), by delivery of written Notice (each, a “Dispute Notice”)
from either Party to the other Party. Such persons shall negotiate in good faith to resolve the Dispute. If the Parties cannot
resolve any Dispute within thirty (30) days after delivery of the applicable Dispute Notice, the Dispute shall be resolved exclusively
by an action to be held in the federal and state courts sitting in the location of the defendant in such matter shall have exclusive
jurisdiction. Such arbitration shall be commenced by the sending of a written notice by the aggrieved Party to the other Party,
setting forth a statement of the grievance. The mailing of such notice shall commence the arbitration, and the award or decision
in such arbitration shall be binding upon the Parties. Such award or decision may be entered as a judgment in such court or courts
as may have jurisdiction in the matter. The losing Party in any action to enforce its rights or settle any disputes under this
Agreement shall pay to the prevailing Party all of its costs and expenses paid or incurred in connection with such suit or action,
including, without limitation, the prevailing Party’s reasonable attorneys’ fees, costs and expenses. THE PARTIES HEREBY
INTENTIONALLY, KNOWINGLY AND VOLUNTARILY WAIVE ALL OF THEIR RESPECTIVE RIGHTS TO A TRIAL BY JURY IN ANY PROCEEDING BROUGHT TO ENFORCE
OR DEFEND ANY PROVISION CONTAINED IN THIS AGREEMENT.

 

    29

     

    

 

Section 17.14 Governing
Law. This Agreement, including all Purchase Order documents and exhibits, schedules, attachments, and appendices attached to
this Agreement and thereto, shall be governed by and construed in accordance with the Laws of the State of Delaware, without regard
to its choice or conflict of laws rules. The parties agree that the United Nations Convention on Contracts for the International
Sale of Goods does not apply to this Agreement.

 

Section 17.15 Counterparts.
This Agreement may be executed in counterparts, each of which is deemed an original, but all of which together are deemed to be
one and the same agreement. A signed copy of this Agreement delivered by facsimile, email, or other means of electronic transmission
is deemed to have the same legal effect as delivery of an original signed copy of this Agreement.

  

Section 17.16 Force
Majeure. Any delay or failure of either Party to perform its obligations under this Agreement will be excused to the extent
that the delay or failure was caused directly by an event beyond such Party’s control, without such Party’s fault or
negligence and that by its nature could not have been foreseen by such Party or, if it could have been foreseen, was unavoidable
(which events include, without limitation, natural disasters, embargoes, explosions, riots, wars, or acts of terrorism, epidemics,
pandemics (excluding the COVID-19 pandemic in effect as of the date hereof), or any action, order, or other response by any federal,
state, or local government authority related to any of the foregoing that directly prevents a Party from performing its obligations)
(each, a “Force Majeure Event”). Either party’s financial inability to perform, changes in cost or availability
of materials, components, or services, market conditions or supplier actions or contract disputes will not excuse performance by
such party under this Section 17.16. Each party shall give the other prompt written notice of any event or circumstance
that is reasonably likely to result in a Force Majeure Event, and the anticipated duration of such Force Majeure Event. Each party
shall use all diligent efforts to end the Force Majeure Event, ensure that the effects of any Force Majeure Event are minimized
and resume full performance under this Agreement.

 

    30

     

    

 

Section 17.17 No
Franchise or Business Opportunity Agreement. The Parties are independent contractors and nothing in this Agreement shall be
deemed or constructed as creating a joint venture, employment, partnership, agency relationship, business opportunity, or franchise
between Seller and Master Distributor. Neither Party, by virtue of this Agreement, will have any right, power, or authority to
act or create an obligation, express or implied, on behalf of the other Party. Each Party assumes responsibility for the actions
of its personnel under this Agreement and will be solely responsible for their supervision, daily direction, and control, wage
rates, withholding income taxes, disability benefits, or the manner and means through which the work under this Agreement will
be accomplished. Except as provided otherwise in this Agreement, Master Distributor has the sole discretion to determine Master
Distributor’s methods of operation, Master Distributor’s accounting practices, the types and amounts of insurance Master
Distributor carries, Master Distributor’s personnel practices, Master Distributor’s marketing and promotion, Master
Distributor’s customers, and Master Distributor’s service areas and methods. The relationship created hereby between
the parties is solely that of supplier and distributor. If any provision of this Agreement is deemed to create a franchise or business
opportunity relationship between the parties, then the parties shall negotiate in good faith to modify this Agreement so as to
effect the parties’ original intent as closely as possible in a mutually acceptable manner in order that the transactions
contemplated hereby be consummated as a distribution agreement and not a franchise or business opportunity agreement.

 

Section 17.18 Non-Solicitation.
Neither party will solicit and/or offer employment to or hire as a contractor for service, nor accept for employment or hire
as a contractor for service, the other party’s personnel, including independent contractors during the Term of this Agreement
and for a period continuing for twelve (12) months subsequent to the termination of the Agreement inclusive of any extension thereof;
provided, however, that the foregoing restriction shall not apply to solicitations directed at the public in general.

 

 

[Signature Page follows] 

 

 

    31

     

    

 

IN WITNESS WHEREOF, the
Parties hereto have executed this Agreement as of the Effective Date.

 

 

	 	CREATIVE REALITIES, INC. 
	 	 	 
	 	By:	/s/ Richard Mills

	 	 	 
	 	Name: 	Richard Mills

	 	 	 
	 	Its: 	Chief Executive Officer
	 	 	 
	 	 	 
	 	INREALITY, LLC
	 	 	 
	 	By	/s/ Ron Levac
	 	 	 
	 	Name:	Ron Levac

	 	 	 
	 	Its:	Chief Executive Officer

 

 

 

    32

     

    

 

ADDENDUM A

TERRITORY ADDENDUM

(United States)

 

    33

     

    

 

ADDENDUM B

TERRITORY ADDENDUM

(Canada)

 

    34

     

    

 

SCHEDULE 1

LIST OF GOODS

 

    35

     

    

 

SCHEDULE 2

BILLING AND SUPPORT FOR

OUT-OF-SCOPE PRODUCTS

 

    36

     

    

 

SCHEDULE 3

MASTER DISTRIBUTOR’S TRADEMARKS

 

    37

     

    

 

SCHEDULE 4

SELLER’S TRADEMARKS

 

    38

     

    

 

EXHIBIT A

SERVICE LEVEL AGREEMENT

 

 

 

    39

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00310-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00310-of-00352.parquet"}]]