Document:

Exhibit 4.5

 

DESCRIPTION OF REGISTRANT’S SECURITIES

 

The following summary of Merida Merger Corp. I’s
securities is based on and qualified by the Company’s Amended and Restated Articles of Incorporation (the “Amended and Restated
Charter”). References to the “Company” and to “we,” “us,” and “our” refer to Merida
Merger Corp. I.”

 

General

 

As of December 31, 2020, the Company is authorized
to issue 50,000,000 shares of common stock, par value $0.0001 and 1,000,000 shares of preferred stock, par value $0.0001. There are no
shares of preferred stock currently outstanding.

 

Common Stock

 

At December 31, 2020, there were 16,371,940 issued
and outstanding shares of common stock. Our stockholders of record are entitled to one vote for each share held on all matters to be voted
on by stockholders. In connection with any vote held to approve our initial business combination, our Sponsor, as well as all of our officers
and directors, have agreed to vote their respective shares of common stock owned by them immediately prior to our IPO and any shares purchased
in IPO or following the IPO in the open market in favor of the proposed business combination.

 

Our board of directors is divided into three classes,
each of which will generally serve for a term of three years with only one class of directors being elected in each year. There is no
cumulative voting with respect to the election of directors, with the result that the holders of more than 50% of the shares eligible
to vote for the election of directors can elect all of the directors.

 

Pursuant to our Amended and Restated Charter, if we
do not consummate an initial business combination by November 7, 2021, our corporate existence will cease except for the purposes of winding
up our affairs and liquidating and we will redeem 100% of our outstanding public shares for a pro rata portion of the funds held in the
trust account, equal to the aggregate amount then on deposit in the trust account including interest earned on the funds held in the trust
account and not previously released to us, divided by the number of then outstanding public shares, subject to applicable law and as further
described herein. Our Sponsor, officers and directors have agreed to waive their rights to participate in any liquidation distribution
from the trust account occurring upon our failure to consummate an initial business combination with respect to the founder’s common
stock. Our Sponsor, officers and directors will therefore not participate in any liquidation distribution from the trust account with
respect to such shares. They will, however, participate in any liquidation distribution from the trust account with respect to any shares
of common stock acquired in, or following, our IPO.

 

Our stockholders have no conversion, preemptive or
other subscription rights and there are no sinking fund or redemption provisions applicable to the shares of common stock, except that
public stockholders have the right to have their shares of common stock converted to cash equal to their pro rata share of the trust account
in connection with the consummation of our business combination. Public stockholders who convert their stock into their share of the trust
account still have the right to exercise the warrants that they received as part of the units.

 

If we seek to amend any provisions of our amended
and restated certificate of incorporation that would affect our public stockholders’ ability to convert their shares in connection
with a business combination as described herein or affect the substance or timing of our obligation to redeem 100% of our public shares
if we do not complete a business combination within 24 months from the closing of this offering, we will provide dissenting public
stockholders with the opportunity to convert their public shares in connection with any such vote. This conversion right shall apply in
the event of the approval of any such amendment, whether proposed by our Sponsor, any executive officer, director or director nominee,
or any other person. 

 

Preferred Stock

 

There are no shares of preferred stock outstanding.
Our board of directors is empowered, without stockholder approval, to issue preferred stock with dividend, liquidation, conversion, voting
or other rights which could adversely affect the voting power or other rights of the holders of common stock. However, the underwriting
agreement entered into by us in connection with the IPO prohibits us, prior to a business combination, from issuing preferred stock which
participates in any manner in the proceeds of the trust account, or which votes as a class with the common stock on a business combination.
We may issue some or all of the preferred stock to effect a business combination. In addition, the preferred stock could be utilized as
a method of discouraging, delaying or preventing a change in control of us. Although we do not currently intend to issue any shares of
preferred stock, we cannot assure you that we will not do so in the future.

 

     

     

    

 

Warrants

 

There are 10,451,087 warrants outstanding. Each whole
warrant entitles the registered holder to purchase one share of common stock at a price of $11.50 per share, subject to adjustment as
discussed below, at any time commencing on the later of 30 days after the completion of an initial business combination or November 7,
2020.  However, no warrants will be exercisable for cash unless we have an effective and current registration statement covering
the shares of common stock issuable upon exercise of the warrants and a current prospectus relating to such shares of common stock. Notwithstanding
the foregoing, if a registration statement covering the shares of common stock issuable upon exercise of the public warrants is not effective
within a specified period following the consummation of our initial business combination, warrant holders may, until such time as there
is an effective registration statement and during any period when we shall have failed to maintain an effective registration statement,
exercise warrants on a cashless basis pursuant to the exemption provided by Section 3(a)(9) of the Securities Act, provided that such
exemption is available. If that exemption, or another exemption, is not available, holders will not be able to exercise their warrants
on a cashless basis. In the event of such a cashless exercise, each holder would pay the exercise price by surrendering the warrants for
that number of shares of common stock equal to the quotient obtained by dividing (x) the product of the number of shares of common stock
underlying the warrants, multiplied by the difference between the exercise price of the warrants and the “fair market value”
(defined below) by (y) the fair market value. The “fair market value” for this purpose will mean the average reported last
sale price of the shares of common stock for the 5 trading days ending on the trading day prior to the date of exercise. The warrants
will expire on the fifth anniversary of our completion of an initial business combination, at 5:00 p.m., New York City time, or earlier
upon redemption or liquidation.

 

The private warrants issued to EarlyBirdCapital, Inc.
and our Sponsor, as well as any warrants underlying additional units we issue to our Sponsor, officers, directors or their affiliates
in payment of working capital loans made to us, will be identical to the warrants underlying the units being offered by this prospectus
except that such warrants will be exercisable for cash or on a cashless basis, at the holder’s option, and will not be redeemable
by us, in each case so long as they are still held by our Sponsor or its permitted transferees.

 

We may call the warrants for redemption (excluding
the private warrants and any warrants underlying additional units issued to our Sponsor, initial stockholders, officers, directors or
their affiliates in payment of working capital loans made to us), in whole and not in part, at a price of $0.01 per warrant, (i) at any
time after the warrants become exercisable, (ii) upon not less than 30 days’ prior written notice of redemption to each warrant
holder after the warrants become exercisable, (iii)  if, and only if, the reported last sale price of the shares of common stock
equals or exceeds $18.00 per share (as adjusted for stock splits, stock dividends, reorganizations and recapitalizations), for any 20
trading days within a 30 trading day period commencing after the warrants become exercisable and ending on the third business day prior
to the notice of redemption to warrant holders, and (iv) if, and only if, there is a current registration statement in effect with respect
to the shares of common stock underlying such warrants.

 

The right to exercise will be forfeited unless the
warrants are exercised prior to the date specified in the notice of redemption. On and after the redemption date, a record holder of a
warrant will have no further rights except to receive the redemption price for such holder’s warrant upon surrender of such warrant.

 

If we call the warrants for redemption as described
above, our management will have the option to require all holders that wish to exercise warrants to do so on a “cashless basis.”
In such event, each holder would pay the exercise price by surrendering the warrants for that number of shares of common stock equal to
the quotient obtained by dividing (x) the product of the number of shares of common stock underlying the warrants, multiplied by the difference
between the exercise price of the warrants and the “fair market value” (defined below) by (y) the fair market value. The “fair
market value” for this purpose shall mean the average reported last sale price of the shares of common stock for the 5 trading days
ending on the third trading day prior to the date on which the notice of redemption is sent to the holders of warrants.

 

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The exercise price and number of shares of common
stock issuable on exercise of the warrants may be adjusted in certain circumstances including in the event of a stock dividend, extraordinary
dividend or our recapitalization, reorganization, merger or consolidation. However, except as described below, the warrants will not be
adjusted for issuances of shares of common stock at a price below their respective exercise prices.

 

In addition, if (x) we issue additional shares of
common stock or equity-linked securities for capital raising purposes in connection with the closing of our initial business combination
at an issue price or effective issue price of less than $9.20 per share of common stock (with such issue price or effective issue price
to be determined in good faith by our board of directors, and in the case of any such issuance to our Sponsor, initial stockholders or
their affiliates, without taking into account any founders’ shares held by them prior to such issuance), (y) the aggregate gross
proceeds from such issuances represent more than 60% of the total equity proceeds, and interest thereon, available for the funding of
our initial business combination on the date of the consummation of our initial business combination (net of redemptions), and (z) the
Market Value is below $9.20 per share, the exercise price of the warrants will be adjusted (to the nearest cent) to be equal to 115% of
the greater of (i) the Market Value or (ii) the price at which we issue the additional shares of common stock or equity-linked securities.
The “Market Value” for this purpose means the volume weighted average trading price of our common stock during the 20 trading
day period starting on the trading day prior to the day on which we consummate our initial business combination.

 

No fractional shares will be issued upon exercise
of the warrants. If, upon exercise of the warrants, a holder would be entitled to receive a fractional interest in a share, we will, upon
exercise, round up to the nearest whole number the number of shares of common stock to be issued to the warrant holder.

 

Dividends

 

We have not paid any cash dividends on our shares
of common stock to date and do not intend to pay cash dividends prior to the completion of a business combination. The payment of cash
dividends in the future will be dependent upon our revenues and earnings, if any, capital requirements and general financial condition
subsequent to completion of a business combination. The payment of any dividends subsequent to a business combination will be within the
discretion of our then board of directors. It is the present intention of our board of directors to retain all earnings, if any, for use
in our business operations and, accordingly, our board does not anticipate declaring any dividends in the foreseeable future.

 

Listing of Securities

 

Our common stock and warrants are listed on Nasdaq
under the symbols “MCMJ,” and “MCMJW,” respectively and on the Neo  under the symbols “MMK.U,”
and “MMK.WT.U,” respectively.

 

Delaware Anti-Takeover Law

 

Staggered Board of Directors

 

Our Amended and Restated Charter provides that our
board of directors will be classified into three classes of directors of approximately equal size. As a result, in most circumstances,
a person can gain control of our board only by successfully engaging in a proxy contest at two or more annual meetings.

 

Special Meeting of Stockholders

 

Our bylaws provide that special meetings of our stockholders
may be called only by a majority vote of our board of directors, by our president or by our chairman or by our secretary at the request
in writing of stockholders owning a majority of our issued and outstanding capital stock entitled to vote.

 

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Advance Notice Requirements for Stockholder Proposals
and Director Nominations

 

Our bylaws provide that stockholders seeking to bring
business before our annual meeting of stockholders, or to nominate candidates for election as directors at our annual meeting of stockholders
must provide timely notice of their intent in writing. To be timely, a stockholder’s notice will need to be delivered to our principal
executive offices not later than the close of business on the 60th day nor earlier than the close of business on the 90th day
prior to the scheduled date of the annual meeting of stockholders. In the event that less than 70 days’ notice or prior public disclosure
of the date of the annual meeting of stockholders is given, a stockholder’s notice shall be timely if delivered to our principal
executive offices not later than the 10th day following the day on which public announcement of the date of our annual
meeting of stockholders is first made or sent by us. Our bylaws also specify certain requirements as to the form and content of a stockholders’
meeting. These provisions may preclude our stockholders from bringing matters before our annual meeting of stockholders or from making
nominations for directors at our annual meeting of stockholders.

 

Authorized but Unissued Shares

 

Our authorized but unissued common stock and preferred
stock are available for future issuances without stockholder approval and could be utilized for a variety of corporate purposes, including
future offerings to raise additional capital, acquisitions and employee benefit plans. The existence of authorized but unissued and unreserved
common stock and preferred stock could render more difficult or discourage an attempt to obtain control of us by means of a proxy contest,
tender offer, merger or otherwise.

 

Exclusive Forum Selection

 

Our amended and restated certificate of incorporation
will require, to the fullest extent permitted by law, that derivative actions brought in our name, actions against directors, officers
and employees for breach of fiduciary duty and other similar actions may be brought only in the Court of Chancery in the State of Delaware,
except any action (A) as to which the Court of Chancery in the State of Delaware determines that there is an indispensable party not subject
to the jurisdiction of the Court of Chancery (and the indispensable party does not consent to the personal jurisdiction of the Court of
Chancery within ten days following such determination), (B) which is vested in the exclusive jurisdiction of a court or forum other than
the Court of Chancery, (C) for which the Court of Chancery does not have subject matter jurisdiction or (D) any action arising under the
Securities Act, as to which the Court of Chancery and the federal district court for the District of Delaware shall have concurrent jurisdiction.
If an action is brought outside of Delaware, the stockholder bringing the suit will be deemed to have consented to service of process
on such stockholder’s counsel. Although we believe this provision benefits us by providing increased consistency in the application
of Delaware law in the types of lawsuits to which it applies, a court may determine that this provision is unenforceable, and to the extent
it is enforceable, the provision may have the effect of discouraging lawsuits against our directors and officers, although our stockholders
will not be deemed to have waived our compliance with federal securities laws and the rules and regulations thereunder and therefore bring
a claim in another appropriate forum. Additionally, we cannot be certain that a court will decide that this provision is either applicable
or enforceable, and if a court were to find the choice of forum provision contained in our amended and restated certificate of incorporation
to be inapplicable or unenforceable in an action, we may incur additional costs associated with resolving such action in other jurisdictions,
which could harm our business, operating results and financial condition.

 

Our Amended and Restated Charter will provide that
the exclusive forum provision will be applicable to the fullest extent permitted by applicable law. Section 27 of the Exchange Act creates
exclusive federal jurisdiction over all suits brought to enforce any duty or liability created by the Exchange Act or the rules and regulations
thereunder. As a result, the exclusive forum provision will not apply to suits brought to enforce any duty or liability created by the
Exchange Act or any other claim for which the federal courts have exclusive jurisdiction.

 

 

4EXECUTIVE EMPLOYMENT AGREEMENT

THIS EXECUTIVE EMPLOYMENT AGREEMENT (“Agreement”) is made effective as of July 26, 2021 (“Effective Date”), by and between CynergisTek, Inc., a Delaware corporation (together with its subsidiaries, “Company”) and Michael McMillan (“Executive”).

The parties agree as follows:

1.Employment. Company hereby employs Executive, and Executive hereby accepts such employment, upon the terms and conditions set forth herein. 

2.Duties. 

2.1Position. Executive shall serve as President and Chief Executive Officer of Company, and shall have the duties and responsibilities as are commensurate with such position, as reasonably and lawfully directed by Company’s board of directors (the “Board of Directors”) from time to time. Executive shall perform faithfully and diligently all duties assigned to Executive. Company reserves the right to modify Executive’s duties at any time in its sole and absolute discretion.  Executive shall also serve as the President and Chief Executive Officer of CTEK Security, Inc. and such additional subsidiaries and affiliates of Company as Executive and the Board of Directors mutually agree from time to time.   

2.2 Best Efforts/Full-time. Executive will expend Executive’s best efforts on behalf of Company and its subsidiaries and will abide by all policies and decisions made by Company, as well as all applicable federal, state and local laws, regulations or ordinances. Executive will act in the best interest of Company at all times. Executive shall devote Executive’s full business time and efforts to the performance of Executive’s assigned duties for Company, unless Executive notifies the Board of Directors in advance of Executive’s intent to engage in other paid work and receives the Board of Directors’ express written consent to do so. 

3.Term. The employment relationship pursuant to this Agreement shall be for a term commencing on the Effective Date set forth above and continuing for a period of twelve (12) months (“Initial Term”), unless earlier terminated in accordance with Section 7 below. 

4.Compensation. As compensation for Executive’s performance of Executive’s duties hereunder, Company shall pay an annual base salary of $300,000 (the “Base Salary”), payable in accordance with the normal payroll practices of Company, less required deductions for state and federal withholding tax, social security and all other employment taxes and payroll deductions. Except as provided in Section 7 below, Executive’s base salary shall in any event be paid through the end of the Initial Term. 

5.Customary Fringe Benefits. Executive will be eligible for all customary and usual fringe benefits generally available to executives of Company, subject to the terms and conditions of Company’s benefit plan documents. Company reserves the right to change or eliminate the fringe benefits on a prospective basis, at any time, effective upon notice to Executive. 

6.Business Expenses. Executive will be reimbursed for all reasonable, out-of-pocket business expenses incurred in the performance of Executive’s duties on behalf of Company. To obtain  

reimbursement, expenses must be submitted promptly with appropriate supporting documentation in accordance with Company’s policies.

7.Termination of Executive’s Employment for Cause. Although Company anticipates a mutually rewarding employment relationship with Executive, Company may terminate Executive’s employment immediately at any time for Cause. For purposes of this Agreement, “Cause” is defined as: (a) acts or omissions constituting gross negligence, recklessness or willful misconduct on the part of Executive with respect to Executive’s obligations or otherwise relating to the business of Company; (b) Executive’s material breach of this Agreement; and (c) Executive’s conviction or entry of a plea of nolo contendere for fraud, misappropriation or embezzlement, or any felony or crime of moral turpitude. In the event Executive’s employment is terminated in accordance with this Section 7, (i) Executive shall be entitled to receive Executive’s Base Salary prorated to the date of termination, and (ii) all other Company obligations to Executive pursuant to this Agreement will become automatically terminated and completely extinguished. 

8.No Conflict of Interest.  Executive represents and warrants that (a) Executive is not subject to any contract, arrangement, policy or understanding, or to any statute, governmental rule or regulation, that in any way limits Executive’s ability to enter into and fully perform Executive’s obligations under this Agreement, and (b) Executive is not otherwise unable to enter into and fully perform Executive’s obligations under this Agreement.  In the event of a breach of any representation in this Section 8, Company may terminate this Agreement for Cause and Executive’s employment with Company without any liability to Executive and Executive shall indemnify the Company for any liability it may incur as a result of any such breach. 

9.Confidentiality.  

9.1Confidential Information. As used herein, the term “Confidential Information” means any information, technical data or know-how of Company, including, but not limited to, that which relates to customers, business affairs, business plans, financial matters, financial plans and projections, pending and proposed acquisitions, operational and hiring matters, contracts and agreements, marketing, sales and pricing, prospects of Company, and any information, technical data or know-how that contain or reflect any of the foregoing, whether prepared by Company, Executive or any other person or entity; provided, however, that the term “Confidential Information” shall not include information, technical data or know-how that Executive can demonstrate is generally available to the public not as a result of any breach of this Agreement by Executive.  Executive hereby acknowledges and agrees that during the term of Executive’s employment contemplated herein, Executive will come into contact with, and have access to the above-described Confidential Information. 

9.2No Disclosure.  Except in the performance of Executive’s duties as an executive of Company, Executive will not, during or after the term of Executive’s engagement with Company, disclose to any person or entity or use, for any reason whatsoever, any Confidential Information. Notwithstanding anything to the contrary herein, nothing in this Agreement is intended to limit or discourage Executive from a good faith disclosure of information to a government entity, agency or official related to a suspected violation of the law, and Executive will not be held civilly or criminally liable under any federal or state trade secret law for disclosing a trade secret in confidence to a government official or attorney solely for the purpose of reporting or investigating a suspected violation of the law, or for disclosing a trade secret in a complaint or other document filed in a lawsuit or other proceeding, so long as such filing is made under seal. 

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10.Restrictive Covenants.  

10.1Non-Competition.  Executive agrees that, during the term of his employment, Executive shall not, directly or indirectly, on Executive’s own behalf or on behalf of any other third party not affiliated with Company: (A) perform services in the healthcare information technology consulting industry or any other business in which Company or its subsidiaries engage during the term of this Agreement with the involvement of Executive (the “Business”) anywhere in the United States of America (the “Restricted Territory”), including providing funds for the same; or (B) provide services routinely performed for customers or clients (“Customers”) (directly or indirectly) in the operation of the Business (“Services”) in the Restricted Territory.   

10.2Non-Solicitation.  Executive agrees that, during the term of this Agreement, and for a period of one (1) year after the termination of this Agreement,  Executive shall not, directly or indirectly, on Executive’s own behalf or on behalf of any other third party not affiliated with Company: (A) solicit any Customer of the Business for purposes of providing Services; (B) accept as a customer any Customer for purposes of providing Services; (C) induce or attempt to induce any employee, consultant or independent contractor of Company or its subsidiaries to terminate his or her employment or relationship with Company or its subsidiaries; (D) employ, or engage as an independent contractor, any employee, consultant or independent contractor of Company or its subsidiaries; (E) interfere with the business relationship between a Customer or employee and Company or its subsidiaries; or (F) encourage any person to engage in any of the foregoing activities, including but not limited to providing financing, directly or indirectly, for any of the foregoing activities; provided, however, that the foregoing will not restrict the ability of Executive to purchase or otherwise acquire up to two percent of any class of securities of any enterprise (but without otherwise participating in the activities of such enterprise) if such securities have been registered under Section 12(b) or 12(g) of the Securities Exchange Act of 1934. 

10.3Reasonable Restrictions. Executive hereby agrees that the covenants in this Agreement are reasonable given the real and potential competition encountered (and reasonably expected to be encountered) by Company and the substantial knowledge and goodwill Executive will acquire with respect to the Business.  Executive and Company understand and agree that the purpose of this Section 10 is solely to protect Company’s legitimate business interests, including, but not limited to confidential information and trade secrets, partner relationships and goodwill, and Company’s competitive advantage in the operation of the Business or provision of Services.  Executive and Company further understand and agree that this Section 10 represents an important element of this Agreement and is a material inducement to Company entering into this Agreement, without which Company would not have entered into this Agreement.  Notwithstanding the foregoing, in the event that at the time of enforcement of any provision of Section 10 a court or other tribunal will hold that the restrictions in Section 10 are unreasonable or unenforceable under circumstances then existing, the parties agree that the maximum period, scope or geographical area reasonable under such circumstances will be substituted for the stated period, scope or area.  

11.Injunctive Relief. Executive acknowledges that Executive’s breach of the covenants contained in this Agreement would cause irreparable injury to Company and agrees that in the event of any such breach, Company shall be entitled to seek temporary, preliminary and permanent injunctive relief without the necessity of proving actual damages or posting any bond or other security. 

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12.Agreement to Arbitrate. To the fullest extent permitted by law, Executive and Company agree to arbitrate any controversy, claim or dispute between them arising out of or in any way related to this Agreement, the employment relationship between Company and Executive and any disputes upon termination of employment, including but not limited to breach of contract, tort, discrimination, harassment, wrongful termination, demotion, discipline, failure to accommodate, family and medical leave, compensation or benefits claims, constitutional claims; and any claims for violation of any local, state or federal law, statute, regulation or ordinance or common law. Claims for workers’ compensation, unemployment insurance benefits and Company’s right to obtain injunctive relief pursuant to Section 11 above are excluded. For the purpose of this agreement to arbitrate, references to “Company” include all parent, subsidiary or related entities and their employees, supervisors, officers, directors, agents, pension or benefit plans, pension or benefit plan sponsors, fiduciaries, administrators, affiliates and all successors and assigns of any of them, and this agreement to arbitrate shall apply to them to the extent Executive’s claims arise out of or relate to their actions on behalf of Company. 

12.1Consideration. The mutual promise by Company and Executive to arbitrate any and all disputes between them rather than litigate them before the courts or other bodies, provides the consideration for this agreement to arbitrate. 

12.2Initiation of Arbitration. Either party may exercise the right to arbitrate by providing the other party with written notice of any and all claims forming the basis of such right in sufficient detail to inform the other party of the substance of such claims. In no event shall the request for arbitration be made after the date when institution of legal or equitable proceedings based on such claims would be barred by the applicable statute of limitations. 

12.3Arbitration Procedure. The arbitration will be conducted in Austin, Texas by a single neutral arbitrator and in accordance with the then current rules for resolution of employment disputes of the American Arbitration Association. The parties are entitled to representation by an attorney or other representative of their choosing. The arbitrator shall have the power to enter any award that could be entered by a judge of the trial court of the State of Texas, and only such power, and shall follow the law. In the event the arbitrator does not follow the law, the arbitrator will have exceeded the scope of his or her authority and the parties may, at their option, file a motion to vacate the award in court. The parties agree to abide by and perform any award rendered by the arbitrator. Judgment on the award may be entered in any court having jurisdiction thereof. 

12.4Costs of Arbitration. The Company shall bear the cost of the arbitration filing and hearing fees, and the cost of the arbitrator. 

This agreement to arbitrate specifically includes any class-action cases and Executive specifically waives Executive’s right to participate in any class-action against Company.

13.General Provisions. 

13.1Successors and Assigns. The rights and obligations of Company under this Agreement shall inure to the benefit of and shall be binding upon the successors and assigns of Company. Executive shall not be entitled to assign any of Executive’s rights or obligations under this Agreement. 

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13.2Waiver. Either party’s failure to enforce any provision of this Agreement shall not in any way be construed as a waiver of any such provision or prevent that party thereafter from enforcing each and every other provision of this Agreement. 

13.3Attorneys’ Fees. Each side will bear its own attorneys’ fees in any dispute unless a statutory section at issue, if any, authorizes the award of attorneys’ fees to the prevailing party. 

13.4Severability. In the event any provision of this Agreement is found to be unenforceable by an arbitrator or court of competent jurisdiction, such provision shall be deemed modified to the extent necessary to allow enforceability of the provision as so limited, it being intended that the parties shall receive the benefit contemplated herein to the fullest extent permitted by law. If a deemed modification is not satisfactory in the judgment of such arbitrator or court, the unenforceable provision shall be deemed deleted, and the validity and enforceability of the remaining provisions shall not be affected thereby.  

13.5Interpretation; Construction. The headings set forth in this Agreement are for convenience only and shall not be used in interpreting this Agreement. This Agreement has been drafted by legal counsel representing Company, but Executive has participated in the negotiation of its terms. Furthermore, Executive acknowledges that Executive has had an opportunity to review and revise the Agreement and have it reviewed by legal counsel, if desired, and, therefore, the normal rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall not be employed in the interpretation of this Agreement. 

13.6Governing Law. This Agreement will be governed by and construed in accordance with the laws of the United States and the State of Texas. Subjection to Section 12, each party consents to the jurisdiction and venue of the state or federal courts in Travis County, Texas, if applicable, in any action, suit, or proceeding arising out of or relating to this Agreement. 

13.7Notices. Any notice required or permitted by this Agreement shall be in writing and shall be delivered as follows with notice deemed given as indicated (a) by personal delivery when delivered personally; (b) by overnight courier upon written verification of receipt; (c) by telecopy or facsimile transmission upon acknowledgment of receipt of electronic transmission; or (d) by certified or registered mail, return receipt requested, upon verification of receipt. Notice shall be sent to the addresses set forth below, or such other address as either party may specify in writing. 

13.8Code Section 409A.   

(a)This Agreement is intended to comply with Code Section 409A (“Section 409A”) or an exemption thereunder and shall be construed and administered in accordance with such intent. Notwithstanding any other provision of this Agreement, payments provided under this Agreement may only be made upon an event and in a manner that complies with Section 409A or an applicable exemption. Any nonqualified deferred compensation payments under this Agreement that may be excluded from Section 409A either as separation pay due to an involuntary separation from service or as a short-term deferral shall be excluded from Section 409A to the maximum extent possible. For purposes of Section 409A, each installment payment provided under this Agreement shall be treated as a separate payment.  Any payments to be made under this Agreement upon a termination of employment shall only be made upon a “separation from service” under Section 409A. Notwithstanding the foregoing, Company makes no representations that the payments and benefits provided under this Agreement comply with Section 409A, and in no event shall Company be liable  

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for all or any portion of any taxes, penalties, interest, or other expenses that may be incurred by Executive on account of non-compliance with Section 409A.  

 

(b)Notwithstanding any other provision of this Agreement, if any payment or benefit provided to Executive in connection with his termination of employment is determined to constitute “nonqualified deferred compensation” within the meaning of Section 409A and Executive is determined to be a “specified employee” under Section 409A, then such payment or benefit shall not be paid until the first payroll date to occur following the six-month anniversary of the date of Executive’s termination or, if earlier, on Executive’s death (the “Specified Employee Payment Date”). The aggregate of any payments that would otherwise have been paid before the Specified Employee Payment Date shall be paid to Executive in a lump sum on the Specified Employee Payment Date and thereafter, any remaining payments shall be paid without delay in accordance with their original schedule.   

 

(c)To the extent required by Section 409A, each reimbursement or in-kind benefit provided under this Agreement shall be provided in accordance with the following:  (i) the amount of expenses eligible for reimbursement, or in-kind benefits provided, during each calendar year cannot affect the expenses eligible for reimbursement, or in-kind benefits to be provided, in any other calendar year; (ii) any reimbursement of an eligible expense shall be paid to Executive on or before the last day of the calendar year following the calendar year in which the expense was incurred; and (iii) any right to reimbursements or in-kind benefits under this Agreement shall not be subject to liquidation or exchange for another benefit.   

 

13.9Survival. Sections 8, 9, 10, 11, 12, 13 and 14 of this Agreement shall survive Executive’s employment by Company. 

14.Entire Agreement. This Agreement, including the Confidentiality, Non-Solicitation and Inventions Agreement incorporated herein by reference, constitutes the entire agreement between the parties relating to this subject matter and supersedes all prior or simultaneous representations, discussions, negotiations, and agreements, whether written or oral. This Agreement may be amended or modified only with the written consent of Executive and the Board of Directors of Company. No oral waiver, amendment or modification will be effective under any circumstances whatsoever. 

[Signature Page Follows]

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THE PARTIES TO THIS AGREEMENT HAVE READ THE FOREGOING AGREEMENT AND FULLY UNDERSTAND EACH AND EVERY PROVISION CONTAINED HEREIN. WHEREFORE, THE PARTIES HAVE EXECUTED THIS AGREEMENT ON THE EFFECTIVE DATE.

 

	 

	/s/ Michael McMillan

	 

	Michael McMillan

	 

	11940 Jollyville Road, Suite 300N

	 

	Austin, TX 78759

 

 

	 

	By:

	/s/ Paul Anthony

	 

	 

	Paul Anthony

	 

	 

	Chief Financial Officer

	 

	 

	CynergisTek, Inc.

	 

	 

	11940 Jollyville Road, Suite 300N

	 

	 

	Austin, TX 78759

Signature Page to Michael McMillan Employment Agreement

7

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