Document:

Exhibit 10.36

 

SECURITIES PURCHASE AGREEMENT

This SECURITIES PURCHASE AGREEMENT (the "Agreement"), dated as of March 18, 2016, by and between CANNASYS, INC., a Nevada corporation, with headquarters located at 1350 17th Street, Suite 150, Denver, CO (the "Company"), and KODIAK CAPITAL GROUP, LLC, a Delaware limited liability company, with its address at 260 Newport Center Drive, Newport Beach, CA 92660 (the "Buyer").

WHEREAS:

A. The Company and the Buyer are executing and delivering this Agreement in reliance upon the exemption from securities registration afforded by the rules and regulations as promulgated by the United States Securities and Exchange Commission (the "SEC") under the Securities Act of 1933, as amended (the "1933 Act").

B. Buyer desires to purchase and the Company desires to issue and sell, upon the terms and conditions set forth in this Agreement, two 12% convertible promissory notes of the Company, in the forms attached hereto as Exhibit A and Exhibit B, in the aggregate principal amount of $100,000, with the first note being in the amount of $50,000 (the "First Note") and the second note being in the amount of $50,000 (the "Second Note"). The First Note and the Second Note, together with any note issued in replacement thereof, the "Notes." Each Note is convertible into shares of common stock, $0.001 par value per share, of the Company (the "Conversion Shares"), upon the terms and subject to the limitations and conditions set forth in such Note. The First Note shall be paid for by the Buyer as set forth herein. The Second Note shall initially be paid for by the issuance of an offsetting $50,000 secured note issued to the Company by the Buyer ("Buyer Note"), a copy of which is attached hereto as Exhibit C, provided that prior to conversion of the Second Note, the Buyer must have paid off the Buyer Note in cash such that the Second Note may not be converted until it has been paid for in cash.

NOW THEREFORE, the Company and the Buyer severally (and not jointly) hereby agree as follows:

1. Purchase and Sale of Notes.

a. Purchase of Notes. On each Closing Date (as defined below), the Company shall issue and sell to the Buyer, and the Buyer agrees to purchase from the Company, the principal amounts of Notes as set forth immediately below the Buyer's name on the signature pages hereto.

b. Form of Payment. On each Closing Date (as defined below): (i) the Buyer shall pay the purchase price for the Note to be issued and sold to it at the Closing (as defined below) (the "Purchase Price") by wire transfer of immediately available funds to the Company, in accordance with the Company's written wiring instructions, against delivery of the Note in the principal amount equal to the Purchase Price as set forth immediately below the Buyer's name on the signature pages hereto; and (ii) the Company shall deliver such duly executed Note on behalf of the Company, to the Buyer, against delivery of the Purchase Price.

c. Closing Date. Each closing of the purchase and sale of a Note as contemplated by this Agreement (the "Closing") shall occur on a mutually agreed upon time and date ("Closing Date"), and at such location as may be agreed to by the parties. Subsequent Closings shall occur when the Buyer Note is repaid. The Closing of the Second Note shall be on or before the dates specified in the Buyer Note.

2. Buyer's Representations and Warranties. The Buyer represents and warrants to the Company that:

a. Investment Purpose. As of the date hereof, the Buyer is purchasing the Notes and the Conversion Shares, collectively with the Note, the "Securities," for its own account and not with a present view to, or resale in connection with, any distribution thereof, except pursuant to sales registered or exempted from registration under the 1933 Act; provided, however, that by making the representations herein, the Buyer does not agree to hold any of the Securities for any minimum or other specific term and reserves the right to dispose of the Securities at any time in accordance with or pursuant to a registration statement or an exemption under the 1933 Act.

b. Accredited Investor Status. The Buyer is an "accredited investor" as that term is defined in Rule 501(a) of Regulation D (an "Accredited Investor").

c. Reliance on Exemptions. The Buyer understands that the Securities are being offered and sold in reliance upon specific exemptions from the registration requirements of United States federal and state securities laws, and that the Company is relying upon the truth and accuracy of, and the Buyer's compliance with, the representations, warranties, agreements, acknowledgments, and understandings of the Buyer set forth herein in order to determine the availability of such exemptions and the eligibility of the Buyer to acquire the Securities.

d. Information. The Buyer and its advisors, if any, have been, and for so long as the Notes remain outstanding will continue to be, furnished with all materials relating to the business, finances, and operations of the Company and materials relating to the offer and sale of the Securities that have been requested by the Buyer or its advisors. The Buyer and its advisors, if any, have been, and for so long as the Notes remain outstanding will continue to be, afforded the opportunity to ask questions of the Company. Notwithstanding the foregoing, the Company has not disclosed to the Buyer any material nonpublic information and will not disclose such information unless such information is disclosed to the public prior to or promptly following such disclosure to the Buyer. Neither such inquiries nor any other due diligence investigation conducted by Buyer or any of its advisors or representatives shall modify, amend, or affect Buyer's right to rely on the Company's representations and warranties contained in Section 3 below. The Buyer understands that its investment in the Securities involves a significant degree of risk. The Buyer is not aware of any facts that may constitute a breach of any of the Company's representations and warranties made herein.

e. Governmental Review. The Buyer understands that no United States federal or state agency or any other governmental agency has passed upon or made any recommendation or endorsement of the Securities.

f. Transfer or Resale. The Buyer understands that: (i) the sale or resale of the Securities has not been and is not being registered under the 1933 Act or any applicable state securities laws, and the Securities may not be transferred unless: (a) the Securities are sold pursuant to an effective registration statement under the 1933 Act; (b) the Buyer shall have delivered to the Company, at the cost of the Buyer, an opinion of counsel that shall be in form, substance, and scope customary for opinions of counsel in comparable transactions to the effect that the Securities to be sold or transferred may be sold or transferred pursuant to an exemption from such registration, which opinion shall be accepted by the Company; (c) the Securities are sold or transferred to an "affiliate" (as defined in Rule 144 promulgated under the 1933 Act (or a successor rule) ("Rule 144")) of the Buyer who agrees to sell or otherwise transfer the Securities only in accordance with this Section 2(f) and who is an Accredited Investor; (d) the Securities are sold pursuant to Rule 144; or (e) the Securities are sold pursuant to Regulation S under the 1933 Act (or a successor rule) ("Regulation S"), and the Buyer shall have delivered to the Company, at the cost of the Buyer, an opinion of counsel that shall be in form, substance, and scope customary for opinions of counsel in corporate transactions, which opinion shall be accepted by the Company; (ii) any sale of such Securities made in reliance on Rule 144 may be made only in accordance with the terms of said Rule and further, if said Rule is not applicable, any resale of such Securities under circumstances in which the seller (or the person through whom the sale is made) may be deemed to be an underwriter (as that term is defined in the 1933 Act) may require compliance with some other exemption under the 1933 Act or the rules and regulations of the SEC thereunder; and (iii) neither the Company nor any other person is under any obligation to register such Securities under the 1933 Act or any state securities laws or to comply with the terms and conditions of any exemption thereunder (in each case). Notwithstanding the foregoing or anything else contained herein to the contrary, the Securities may be pledged as collateral in connection with a bona fide margin account or other lending arrangement.

g. Legends. The Buyer understands that the Notes and, until such time as the Conversion Shares have been registered under the 1933 Act may be sold pursuant to Rule 144 or Regulation S without any restriction as to the number of securities as of a particular date that can then be immediately sold, the Conversion Shares may bear a restrictive legend in substantially the following form (and a stop-transfer order may be placed against transfer of the certificates for such Securities):

The securities represented by this certificate have not been registered under the Securities Act of 1933, as amended (the "Securities Act), or under the securities laws of any state. These securities are "restricted securities" within the meaning of Rule 144 promulgated under the Securities Act. The securities have been acquired for investment and may not be sold or transferred without complying with Rule 144 in the absence of an effective registration or an available exemption from registration under the Securities Act and applicable state statutes.

The legend set forth above shall be removed and the Company shall issue a certificate without such legend to the holder of any Security upon which it is stamped, if, unless otherwise required by applicable state securities laws: (i) such Security is registered for sale under an effective registration statement filed under the 1933 Act or otherwise may be sold pursuant to Rule 144 or Regulation S without any restriction as to the number of securities as of a particular date that can then be immediately sold; or (ii) such holder provides the Company with an opinion of counsel, in form, substance, and scope customary for opinions of counsel in comparable transactions, to the effect that a public sale or transfer of such Security may be made without registration under the 1933 Act, which opinion shall be accepted by the Company so that the sale or transfer is effected. The Buyer agrees to sell all Securities, including those represented by a certificate from which the legend has been removed, in compliance with applicable prospectus delivery requirements, if any. In the event that the Company does not accept the opinion of counsel provided by the Buyer respecting the transfer of Securities pursuant to an exemption from registration, such as Rule 144 or Regulation S, within three business days, it will be considered an event of default under the Notes.

h. Authorization; Enforcement. This Agreement has been duly and validly authorized. This Agreement has been duly executed and delivered on behalf of the Buyer, and this Agreement constitutes a valid and binding agreement of the Buyer enforceable in accordance with its terms.

i. Organization and Qualification. The Buyer is a limited liability company duly organized, validly existing, and in good standing under the laws of the jurisdiction in which it is organized, with full power and requisite authority to own, lease, use, and operate its properties and to carry on its business as and where now owned, leased, used, operated, and conducted.

3. Representations and Warranties of the Company. The Company represents and warrants to the Buyer that:

a. Organization and Qualification. The Company and each of its subsidiaries, if any, is a corporation duly organized, validly existing, and in good standing under the laws of the jurisdiction in which it is incorporated, with full power and authority (corporate and other) to own, lease, use, and operate its properties and to carry on its business as and where now owned, leased, used, operated, and conducted.

b. Authorization; Enforcement. (i) The Company has all requisite corporate power and authority to enter into and perform this Agreement, the Notes, and to consummate the transactions contemplated hereby and thereby and to issue the Securities, in accordance with the terms hereof and thereof; (ii) the execution and delivery of this Agreement and the Notes by the Company, and the consummation by it of the transactions contemplated hereby and thereby (including without limitation, the issuance of the Notes and the issuance and reservation for issuance of the Conversion Shares), have been duly authorized by the Company's Board of Directors, and no further consent or authorization of the Company, its Board of Directors, or its shareholders is required; (iii) this Agreement has been duly executed and delivered by the Company by its authorized representative, and such authorized representative is the true and official representative with authority to sign this Agreement and the other documents executed in connection herewith and bind the Company accordingly; and (iv) this Agreement constitutes, and upon execution and delivery by the Company of the Notes, each of such instruments will constitute, legal, valid, and binding obligations of the Company enforceable against the Company in accordance with their respective terms.

c. Issuance of Shares. The Conversion Shares are duly authorized and reserved for issuance and, upon conversion of the Notes in accordance with their respective terms, will be validly issued, fully paid, and nonassessable, and free from all taxes, liens, claims, and encumbrances with respect to the issue thereof and shall not be subject to preemptive rights or other similar rights of shareholders of the Company and will not impose personal liability upon the holder thereof.

d. Acknowledgment of Dilution. The Company understands and acknowledges the potentially dilutive effect to its common stock upon the issuance of the Conversion Shares. The Company further acknowledges that its obligation to issue the Conversion Shares in accordance with this Agreement and the Notes is absolute and unconditional regardless of the dilutive effect that such issuance may have on the ownership interests of other shareholders of the Company.

e. No Conflicts. The execution, delivery, and performance of this Agreement and the Notes by the Company, and the consummation by the Company of the transactions contemplated hereby and thereby (including, without limitation, the issuance and reservation for issuance of the Conversion Shares) will not: (i) conflict with or result in a violation of any provision of the Certificate of Incorporation or Bylaws; or (ii) violate or conflict with, result in a breach of any provision of, or constitute a default (or an event which with notice or lapse of time or both could become a default) under, or give to others any rights of termination, amendment, acceleration or cancellation of, any agreement, indenture, patent, patent license or instrument to which the Company or any of its subsidiaries is a party; or (iii) result in a violation of any law, rule, regulation, order, judgment, or decree (including federal and state securities laws and regulations and regulations of any self-regulatory organizations to which the Company or its securities are subject) applicable to the Company or any of its subsidiaries or by which any property or asset of the Company or any of its subsidiaries is bound or affected (except for such conflicts, defaults, terminations, amendments, accelerations, cancellations, and violations as would not, individually or in the aggregate, have a material adverse effect). All consents, authorizations, orders, filings, and registrations that the Company is required to obtain pursuant to the preceding sentence have been obtained or effected on or prior to the date hereof. The Company is not in violation of the listing requirements of the OTCQB marketplace (the "OTCQB") and does not reasonably anticipate that its common stock will be delisted by the OTCQB in the foreseeable future, nor are the Company's securities "chilled" by DTC. The Company and its subsidiaries are unaware of any facts or circumstances that might give rise to any of the foregoing.

f. Absence of Litigation. Except as disclosed in the Company's public filings, there is no action, suit, claim, proceeding, inquiry, or investigation before or by any court, public board, government agency, or self-regulatory organization or body pending or, to the knowledge of the Company or any of its subsidiaries, threatened against or affecting the Company or any of its subsidiaries, or their officers or directors in their capacity as such, that could have a material adverse effect. Schedule 3(f) contains a complete list and summary description of any pending or, to the knowledge of the Company, threatened proceeding against or affecting the Company or any of its subsidiaries, without regard to whether it would have a material adverse effect. The Company and its subsidiaries are unaware of any facts or circumstances that might give rise to any of the foregoing.

g. Acknowledgment Regarding Buyer's Purchase of the Securities. The Company acknowledges and agrees that the Buyer is acting solely in the capacity of an arm's-length purchaser respecting this Agreement and the transactions contemplated hereby. The Company further acknowledges that the Buyer is not acting as a financial advisor or fiduciary of the Company (or in any similar capacity) respecting this Agreement and the transactions contemplated hereby, and any statement made by the Buyer or any of its respective representatives or agents in connection with this Agreement and the transactions contemplated hereby is not advice or a recommendation and is merely incidental to the Buyer's purchase of the Securities. The Company further represents to the Buyer that the Company's decision to enter into this Agreement has been based solely on the independent evaluation of the Company and its representatives.

h. No Integrated Offering. Neither the Company nor any of its affiliates or any person acting on its or their behalf has directly or indirectly made any offers or sales in any security or solicited any offers to buy any security under circumstances that would require registration under the 1933 Act of the issuance of the Securities to the Buyer. The issuance of the Securities to the Buyer will not be integrated with any other issuance of the Company's securities (past, current, or future) for purposes of any shareholder approval provisions applicable to the Company or its securities.

i. Title to Property. The Company and its subsidiaries have good and marketable title to all personal property owned by them that is material to the business of the Company and its subsidiaries, in each case free and clear of all liens, encumbrances, and defects, except such as are described in Schedule 3(i) or such as would not have a material adverse effect. Any real property and facilities held under lease by the Company and its subsidiaries are held by them under valid, subsisting, and enforceable leases with such exceptions as would not have a material adverse effect.

j. Breach of Representations and Warranties by the Company. If the Company breaches any of the representations or warranties set forth in this Section 3, in addition to any other remedies available to the Buyer pursuant to this Agreement, it will be considered an event of default under the Notes.

4. Covenants.

a. Expenses. At the Closing, the Company shall reimburse Buyer for expenses incurred by it in connection with the negotiation, preparation, execution, delivery, and performance of this Agreement and the other agreements to be executed in connection herewith ("Documents"), including, without limitation, reasonable attorneys' and consultants' fees and expenses, transfer agent fees, fees for stock quotation services, fees relating to any amendments or modifications of the Documents or any consents or waivers of provisions in the Documents, fees for the preparation of opinions of counsel, escrow fees, and costs of restructuring the transactions contemplated by the Documents. When possible, the Company must pay these fees directly, otherwise the Company must make immediate payment for reimbursement to the Buyer for all fees and expenses immediately upon written notice by the Buyer or the submission of an invoice by the Buyer. The Company's obligation to reimburse Buyer's expenses shall not exceed $15,000 (and same amount for the Second Note), which shall be deducted from each Note when cash funded.

b. Listing. The Company shall promptly secure the listing of the Conversion Shares upon each national securities exchange or automated quotation system, if any, upon which shares of its common stock are then listed (subject to official notice of issuance) and, so long as the Buyer owns any of the Securities, Company shall maintain, so long as any other shares of common stock shall be so listed, such listing of all Conversion Shares from time to time issuable upon conversion of the Notes. The Company will obtain and, so long as the Buyer owns any of the Securities, maintain the listing and trading of its common stock on the OTCQB or any equivalent replacement market, the Nasdaq stock market ("Nasdaq"), the New York Stock Exchange ("NYSE"), or the American Stock Exchange ("AMEX") and will comply in all respects with the Company's reporting, filing, and other obligations under the bylaws or rules of the Financial Industry Regulatory Authority, Inc. ("FINRA") and such exchanges, as applicable. The Company shall promptly provide to the Buyer copies of any notices it receives from the OTCQB and any other markets on which its common stock is then listed regarding the continued eligibility of its common stock for listing on such markets.

c. Corporate Existence. So long as the Buyer beneficially owns any Note, the Company shall maintain its corporate existence and shall not sell all or substantially all of the Company's assets, except in the event of a merger or consolidation or sale of all or substantially all of the Company's assets, where the surviving or successor entity in such transaction: (i) assumes the Company's obligations hereunder and under the agreements and instruments entered into in connection herewith; and (ii) is a publicly traded corporation whose common stock is listed for trading on the OTCQB, Nasdaq, NYSE, or AMEX.

d. No Integration. The Company shall not make any offers or sales of any security (other than the Securities) under circumstances that would require registration of the Securities being offered or sold hereunder under the 1933 Act or cause the offering of the Securities to be integrated with any other offering of securities by the Company for the purpose of any stockholder approval provision applicable to the Company or its securities.

e. Breach of Covenants. If the Company breaches any of the covenants set forth in this Section 4, in addition to any other remedies available to the Buyer pursuant to this Agreement, it will be considered an event of default under the Note.

5. Governing Law; Miscellaneous.

a. Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the state of California without regard to principles of conflicts of laws. Any action brought by either party against the other concerning the transactions contemplated by this Agreement shall be brought only in the state courts of California or in the federal courts located in that state and the county of Orange County. The parties to this Agreement hereby irrevocably waive any objection to jurisdiction and venue of any action instituted hereunder and shall not assert any defense based on lack of jurisdiction or venue or based upon forum non conveniens. The Company and Buyer waive trial by jury. The prevailing party shall be entitled to recover from the other party its reasonable attorney's fees and costs. Each party hereby irrevocably waives personal service of process and consents to process being served in any suit, action, or proceeding in connection with this Agreement or any other Document by mailing a copy thereof via registered or certified mail or overnight delivery (with evidence of delivery) to such party at the address in effect for notices to it under this Agreement and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process in any other manner permitted by law.

b. Counterparts; Signatures by Facsimile. This Agreement may be executed in duplicate counterparts, each of which shall be deemed an original but both of which shall constitute one and the same agreement and shall become effective when counterparts have been signed by each party and delivered to the other party. This Agreement, once executed by a party, may be delivered to the other party hereto by facsimile transmission of a copy of this Agreement bearing the signature of the party so delivering this Agreement.

c. Headings. The headings of this Agreement are for convenience of reference only and shall not form part of, or affect the interpretation of, this Agreement.

d. Severability. In the event that any provision of this Agreement is invalid or unenforceable under any applicable statute or rule of law, then such provision shall be deemed inoperative to the extent that it may conflict therewith and shall be deemed modified to conform with such statute or rule of law. Any provision hereof which may prove invalid or unenforceable under any law shall not affect the validity or enforceability of any other provision hereof.

e. Entire Agreement; Amendments. This Agreement and the instruments referenced herein contain the entire understanding of the parties respecting the matters covered herein and therein and, except as specifically set forth herein or therein, neither the Company nor the Buyer makes any representation, warranty, covenant, or undertaking respecting such matters. No provision of this Agreement may be waived or amended other than by an instrument in writing signed by both parties.

f. Notices. Any notice, demand, request, or other communication permitted or required under this Agreement shall be in writing and shall be deemed to have been given as of the date so delivered, if personally delivered; as of the date so sent, if sent by electronic mail and receipt is acknowledged by the recipient; one day after the date so sent, if delivered by overnight courier service; or three days after the date so mailed, if mailed by certified mail, return receipt requested, addressed as follows:

If to the Company, to:

CannaSys, Inc.

1350 17th Street, Suite 150

Denver, CO 80202

Email: michael.tew@cannasys.com

If to the Buyer, to:

Kodiak Capital Group, LLC

260 Newport Center Drive

Newport Beach, CA 92660

Email: ryan@kodiakfunds.com

Each party shall provide notice to the other party of any change in address.

g. Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the parties and their successors and assigns. Neither the Company nor the Buyer shall assign this Agreement or any rights or obligations hereunder without the prior written consent of the other. Notwithstanding the foregoing, the Buyer may assign its rights hereunder to any person that purchases Securities in a private transaction from the Buyer or to any of its "affiliates," as that term is defined under the Securities Exchange Act of 1934, as amended, without the consent of the Company.

h. Third-Party Beneficiaries. This Agreement is intended for the benefit of the parties hereto and their respective permitted successors and assigns, and is not for the benefit of, nor may any provision hereof be enforced by, any other person.

i. Survival. The representations and warranties of the Company and the agreements and covenants set forth in this Agreement shall survive the closing hereunder notwithstanding any due diligence investigation conducted by or on behalf of the Buyer. The Company agrees to indemnify and hold harmless the Buyer and all of its officers, directors, employees, and agents for loss or damage arising as a result of or related to any breach or alleged breach by the Company of any of its representations, warranties, and covenants set forth in this Agreement or any of its covenants and obligations under this Agreement, including advancement of expenses as they are incurred.

j. Further Assurances. Each party shall do and perform, or cause to be done and performed, all such further acts and things, and shall execute and deliver all such other agreements, certificates, instruments, and documents, as the other party may reasonably request in order to carry out the intent and accomplish the purposes of this Agreement and the consummation of the transactions contemplated hereby.

k. No Strict Construction. The language used in this Agreement will be deemed to be the language chosen by the parties to express their mutual intent, and no rules of strict construction will be applied against any party.

l. Remedies. The Company acknowledges that a breach by it of its obligations hereunder will cause irreparable harm to the Buyer by vitiating the intent and purpose of the transaction contemplated hereby. Accordingly, the Company acknowledges that the remedy at law for a breach of its obligations under this Agreement will be inadequate and agrees that, in the event of a breach or threatened breach by the Company of the provisions of this Agreement, the Buyer shall be entitled, in addition to all other available remedies at law or in equity and the penalties assessable herein, to an injunction or injunctions restraining, preventing, or curing any breach of this Agreement and to enforce specifically the terms and provisions hereof, without the necessity of showing economic loss and without any bond or other security being required.

IN WITNESS WHEREOF, the undersigned Buyer and the Company have caused this Agreement to be duly executed as of the date first above written.

CANNASYS, INC.

	
By:

	
/s/ Michael A. Tew

	
Name:

	
Michael A. Tew

	
Its:

	
Chief Executive Officer

KODIAK CAPITAL GROUP, LLC.

	
By:

	
/s/ Ryan Hodson

	
Name:

	
Ryan Hodson

	
Its:

	
CEO and Portfolio Manager

AGGREGATE SUBSCRIPTION AMOUNT:

FIRST NOTE: $50,000.00 less $15,000.00 in expenses

SECOND NOTE: $50,000.00 less $15,000.00 in expenses

	
First Note

	
Exhibit A

 

THIS NOTE AND THE COMMON STOCK ISSUABLE UPON CONVERSION OF THIS NOTE HAVE NOT BEEN AND WILL NOT BE REGISTERED WITH THE UNITED STATES SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND THE RULES AND REGULATIONS PROMULGATED THEREUNDER (THE "1933 ACT").

$50,000

CANNASYS, INC.

12% CONVERTIBLE REDEEMABLE PROMISSORY NOTE

ISSUE DATE: MARCH 18, 2016

MATURITY DATE: MARCH 18, 2017

FOR VALUE RECEIVED, CANNASYS, INC. (the "Company") promises to pay to the order of KODIAK CAPITAL GROUP, LLC and its authorized successors and permitted assigns ("Holder"), the aggregate principal face amount of FIFTY THOUSAND DOLLARS ($50,000) on March 18, 2017 ("Maturity Date"), and to pay interest on the principal amount outstanding hereunder at the rate of 12% per annum commencing on March 18, 2016. Principal of, and interest on, this Note will be paid to the Holder in whose name this Note is registered on the records of the Company, initially payable to Holder at 260 Newport Center Drive, Newport Beach, CA 92660, and if changed, at the address last appearing on the records of the Company as designated in writing by the Holder from time to time. The Company will pay interest and the outstanding principal due upon this Note before or on the Maturity Date, less any amounts required by law to be deducted or withheld, to the Holder by check or wire transfer. The forwarding of such check or wire transfer shall constitute a payment of outstanding principal hereunder and shall satisfy and discharge the liability for principal on this Note to the extent of the sum represented by such check or wire transfer. Interest shall be payable in the Company's common stock pursuant to paragraph 4(b) herein.

This Note is subject to the following additional provisions:

1. This Note is exchangeable for an equal aggregate principal amount of notes of different authorized denominations as requested by the Holder surrendering the same. No service charge will be made for such registration of transfer or exchange, except that Holder shall pay any tax or other governmental charges payable in connection therewith.

2. The Company shall be entitled to withhold from all payments any amounts required to be withheld under applicable laws.

3. This Note may be transferred or exchanged only in compliance with the 1933 Act and applicable state securities laws. Any attempted transfer to a nonqualifying party shall be treated by the Company as void. Prior to due presentment for transfer of this Note, the Company and any agent of the Company may treat the person in whose name this Note is duly registered on the Company's records as the owner hereof for all other purposes, whether or not this Note is overdue, and neither the Company nor any such agent shall be affected or bound by notice to the contrary. Any Holder electing to exercise the right of conversion set forth in Section 4(a) hereof, and any prospective transferee of this Note, in addition to the requirements set forth in Section 4(a) is also required to give the Company written confirmation that this Note is being converted ("Notice of Conversion"), in the form annexed hereto as Exhibit A. The date of receipt of such Notice of Conversion shall be the Conversion Date.

A-1

	
First Note

	
Exhibit A

4.

(a) The Holder is entitled, at its option, at any time after 180 days after the Issue Date, to convert all or any amount of the principal face amount of this Note then outstanding into shares of the Company's common stock (the "Conversion Shares"), without restrictive legend of any nature, at a price ("Conversion Price") for each Conversion Share equal to 50% of the lowest closing bid price of the Company's common stock as reported on the OTCQB marketplace upon which the Company's common stock is traded or any market upon which the common stock may be traded in the future ("Exchange"), for the 30 prior trading days including the day upon which a Notice of Conversion is received by the Company (provided such Notice of Conversion is delivered to the Company after 4 P.M. Eastern Standard or Daylight Savings Time if the Holder wishes to include the same day closing price). If the Conversion Shares have not been delivered within three business days, the Notice of Conversion may be rescinded. Such conversion shall be effectuated by the Company delivering the Conversion Shares to the Holder within three business days of receipt by the Company of the Notice of Conversion. Once the Holder has received such Conversion Shares, the Holder shall surrender this Note to the Company, executed by the Holder evidencing such Holder's intention to convert this Note or a specified portion hereof, and accompanied by proper assignment hereof in blank. Accrued, but unpaid, interest shall be subject to conversion. No fractional shares or scrip representing fractions of shares will be issued on conversion, but the number of shares issuable shall be rounded to the nearest whole share. In the event the Company experiences a DTC "Chill" on its common stock, the Conversion Price shall be decreased to 25% instead of 50% while that Chill is in effect.

(b) Interest on any unpaid principal balance of this Note shall be paid at the rate of 12% per annum. Interest shall be paid by the Company in Conversion Shares. Holder may, at any time, send in a Notice of Conversion to the Company for Conversion Shares based on the formula provided in Section 4(a) above. The dollar amount converted into Conversion Shares shall be all or a portion of the accrued interest calculated on the unpaid principal balance of this Note to the date of such notice.

(c) This Note may be prepaid within 180 days after the Issue Date at 150% of the face amount plus any accrued interest. This Note may not be prepaid after the 180th day. Such redemption must be closed and funded within three days of giving notice of redemption or the right to redeem shall be null and void. Notwithstanding the above, this Note may be paid in full on or 10 business days prior to the Maturity Date by paying the original principal amount of this Note (or the principal amount then owing) plus any accrued and unpaid interest through the payment date.

(d) Upon: (i) a transfer of all or substantially all of the assets of the Company to any person in a single transaction or series of related transactions; (ii) a reclassification, capital reorganization, or other change or exchange of outstanding shares of the Company's common stock, other than a forward or reverse stock split or stock dividend; or (iii) any consolidation or merger of the Company with or into another person or entity in which the Company is not the surviving entity (other than a merger effected solely to change the jurisdiction of incorporation of the Company and results in a reclassification, conversion, or exchange of outstanding shares of the Company's common stock solely into shares of common stock) (each of items (i), (ii), and (iii) being referred to as a "Sale Event"), then, in each case, the Company shall, upon request of the Holder, redeem this Note in cash for 150% of the principal amount, plus accrued but unpaid interest through the date of redemption, or at the election of the Holder, such Holder may convert the unpaid principal amount of this Note (together with the amount of accrued but unpaid interest) into Conversion Shares immediately prior to such Sale Event at the Conversion Price.

 

A-2

	
First Note

	
Exhibit A

(e) In case of any Sale Event (not to include a sale of all or substantially all of the Company's assets) in connection with which this Note is not redeemed or converted, the Company shall cause an effective provision to be made to allow the Holder of this Note the right thereafter, by converting this Note, to purchase or convert this Note into the kind and number of shares of stock or other securities or property (including cash) receivable upon such reclassification, capital reorganization or other change, consolidation or merger by a holder of the number of Conversion Shares that could have been issued upon conversion of the Note and at the same Conversion Price defined in this Note immediately prior to such Sale Event. The foregoing shall similarly apply to successive Sale Events. If the consideration received by the holders of the Company's common stock is other than cash, the value shall be as determined by the board of directors of the Company or successor person or entity acting in good faith.

5. No provision of this Note shall alter or impair the obligation of the Company, which is absolute and unconditional, to pay the principal of, and interest on, this Note at the time, place, rate, and in the form, herein prescribed.

6. The Company hereby expressly waives demand and presentment for payment, notice of nonpayment, protest, notice of protest, notice of dishonor, notice of acceleration or intent to accelerate, and diligence in taking any action to collect amounts called for hereunder and shall be directly and primarily liable for the payment of all sums owing and to be owing hereto.

7. The Company agrees to pay all costs and expenses, including reasonable attorneys' fees and expenses, that may be incurred by the Holder in collecting any amount due under this Note.

8. If one or more of the following described "Events of Default" shall occur:

(a) the Company shall default in the payment of principal or interest on this Note or any other note issued to the Holder by the Company;

(b) any of the representations or warranties made by the Company herein or in any certificate or financial or other written statements heretofore or hereafter furnished by or on behalf of the Company in connection with the execution and delivery of this Note, or the Securities Purchase Agreement under which this Note was issued, shall be false or misleading in any respect;

(c) the Company shall fail to perform or observe, in any respect, any covenant, term, provision, condition, agreement, or obligation of the Company under this Note or any other note issued to the Holder;

(d) the Company shall: (i) become insolvent; (ii) admit in writing its inability to pay its debts generally as they mature; (iii) make an assignment for the benefit of creditors or commence proceedings for its dissolution; (iv) apply for or consent to the appointment of a trustee, liquidator, or receiver for its or for a substantial part of its property or business; (v) file a petition for bankruptcy relief, consent to the filing of such petition, or have filed against it an involuntary petition for bankruptcy relief, all under federal or state laws as applicable;

(e) a trustee, liquidator, or receiver shall be appointed for the Company or for a substantial part of its property or business without its consent and shall not be discharged within 60 days after such appointment;

A-3

	
First Note

	
Exhibit A

(f) any governmental agency or any court of competent jurisdiction at the instance of any governmental agency shall assume custody or control of the whole or any substantial portion of the properties or assets of the Company;

(g) one or more money judgments, writs or warrants of attachment, or similar process, in excess of $25,000 in the aggregate, shall be entered or filed against the Company or any of its properties or other assets and shall remain unpaid, unvacated, unbonded, or unstayed for a period of 15 days or in any event later than five days prior to the date of any proposed sale thereunder;

(h) the Company shall have defaulted on or breached any term of any other note or similar debt instrument into which the Company has entered and failed to cure such default within the appropriate grace period;

(i) the Company shall have its common stock delisted from a market (including the OTCQB marketplace) or, if the common stock trades on an Exchange, then trading in the common stock shall be suspended for more than 10 consecutive days;

(j) if a majority of the members of the board of directors of the Company on the date hereof are no longer serving as members of the Board;

(k) the Company shall not deliver to the Holder the Conversion Shares pursuant to Section 4 herein, without restrictive legend, within three business days of its receipt of a Notice of Conversion;

(l) the Company shall not replenish the reserve set forth in Section 12, within three business days of the request of the Holder;

(m) the Company shall not be "current" in its filings with the U.S. Securities and Exchange Commission; or

(n) the Company shall lose the "bid" price for its stock and a market (including the OTCQB marketplace or other Exchange);

then, or at any time thereafter, unless cured within 10 days, and in each and every such case, unless such Event of Default shall have been waived in writing by the Holder (which waiver shall not be deemed to be a waiver of any subsequent default) at the option of the Holder and in the Holder's sole discretion, the Holder may consider this Note immediately due and payable, without presentment, demand, protest, or (further) notice of any kind (other than notice of acceleration), all of which are hereby expressly waived, anything herein contained to the contrary notwithstanding, and the Holder may immediately, and without expiration of any period of grace, enforce any and all of the Holder's rights and remedies provided herein or any other rights or remedies afforded by law. Upon an Event of Default, interest shall accrue at a default interest rate of 25% per annum or, if such rate is usurious or not permitted by current law, then at the highest rate of interest permitted by law. In the event of a breach of Section 8(k) and the Conversion Shares are not issued within three days, the penalty shall be $1,000 per day beginning on the 4th day after the Conversion Notice was delivered to the Company. This penalty shall increase to $2,000 per day beginning on the 10th day. The penalty for a breach of Section 8(n) shall be an increase of the outstanding principal amounts by 200%. In case of a breach of Section 8(i), the outstanding principal due under this Note shall increase by 200%. If this Note is not paid on or within 10 business days of the Maturity Date, the outstanding principal due under this Note shall increase by 200%.

A-4

	
First Note

	
Exhibit A

If the Holder shall commence and prevail in an action or proceeding to enforce any provisions of this Note, the Holder shall be reimbursed by the Company for its attorneys' fees and other costs and expenses incurred in the investigation, preparation, and prosecution of such action or proceeding.

9. In case any provision of this Note is held by a court of competent jurisdiction to be excessive in scope or otherwise invalid or unenforceable, such provision shall be adjusted rather than voided, if possible, so that it is enforceable to the maximum extent possible, and the validity and enforceability of the remaining provisions of this Note will not in any way be affected or impaired thereby.

10. Neither this Note nor any term hereof may be amended, waived, discharged, or terminated other than by a written instrument signed by the Company and the Holder.

11. The Company represents that it is not a "shell" issuer and has never been a "shell" issuer or that if it previously has been a "shell" issuer, that at least 12 months have passed since the Company has reported Form 10 type information indicating it is no longer a "shell" issuer. The Company will instruct its counsel to write a Rule 144-3(a)(9) opinion to allow for salability of the Conversion Shares or accept such an opinion from Holder's counsel.

12. The Company shall issue irrevocable transfer agent instructions reserving 1,000,000 shares of its common stock for conversion under this Note (the "Share Reserve"). The Share Reserve shall be replenished as needed to allow for conversions of this Note. Upon full conversion of this Note, any shares remaining shall be released from the Share Reserve. The Company shall pay all costs associated with issuing and delivering the Conversion Shares.

13. The Company will give the Holder direct notice of any corporate actions, including name changes, stock splits, recapitalizations etc. This notice shall be given to the Holder as soon as possible under law.

14. This Note shall be governed by and construed in accordance with the laws of California applicable to contracts made and wholly to be performed within the state of California and shall be binding upon the successors and assigns of each party hereto. The Holder and the Company hereby mutually waive trial by jury and consent to exclusive jurisdiction and venue in the courts of the state of California. This Agreement may be executed in counterparts, and the facsimile transmission of an executed counterpart to this Agreement shall be effective as an original.

IN WITNESS WHEREOF, the Company has caused this Note to be duly executed by an officer thereunto duly authorized.

Dated: March 18, 2016

CANNASYS, INC.

By: /s/ Michael A. Tew

Michael A. Tew, Chief Executive Officer

A-5

	
First Note

	
Exhibit A

EXHIBIT A

NOTICE OF CONVERSION

(to be executed by the registered holder in order to convert the note)

The undersigned hereby irrevocably elects to convert $___________ of the above Note into _________ shares of common stock of Cannasys, Inc. ("Conversion Shares") according to the conditions set forth in such Note, as of the date written below. If the Conversion Shares are to be issued in the name of a person other than the undersigned, the undersigned will pay all transfer and other taxes and charges payable with respect thereto.

	
Date of Conversion:

	 
	 	 
	
Applicable Conversion Price:

	 
	 	 
	
Signature:

	 
	 	 
	
Shares are to be registered in the following name:

	 
	 	 
	
Name:

	 
	 	 
	
Address:

	 
	 	 
	
EIN:

	 
	 	 
	
Shares are to be sent to the following account:

	 
	 	 
	
Account Name:

	 
	 	 
	
Address:

	 
	 	
 

 

A-6

 

	
Second Note (Backend)

	
Exhibit B

 

THIS NOTE AND THE COMMON STOCK ISSUABLE UPON CONVERSION OF THIS NOTE HAVE NOT BEEN AND WILL NOT BE REGISTERED WITH THE UNITED STATES SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND THE RULES AND REGULATIONS PROMULGATED THEREUNDER (THE "1933 ACT")

$50,000

CANNASYS, INC.

ISSUE DATE: MARCH 18, 2016

12% CONVERTIBLE REDEEMABLE PROMISSORY NOTE

MATURITY DATE: MARCH 18, 2017

FOR VALUE RECEIVED, CANNASYS, INC. (the "Company") promises to pay to the order of KODIAK CAPITAL GROUP, LLC and its authorized successors and permitted assigns ("Holder"), the aggregate principal face amount of FIFTY THOUSAND DOLLARS ($50,000) on March 18, 2017 ("Maturity Date"), and to pay interest on the principal amount outstanding hereunder at the rate of 12% per annum commencing on March 18, 2016. Principal of, and interest on, this Note will be paid to the Holder in whose name this Note is registered on the records of the Company, initially payable to Holder at 260 Newport Center Drive, Newport Beach, CA 92660, and if changed, at the address last appearing on the records of the Company as designated in writing by the Holder from time to time. The Company will pay interest and the outstanding principal due upon this Note before or on the Maturity Date, less any amounts required by law to be deducted or withheld, to the Holder by check or wire transfer. The forwarding of such check or wire transfer shall constitute a payment of outstanding principal hereunder and shall satisfy and discharge the liability for principal on this Note to the extent of the sum represented by such check or wire transfer. Interest shall be payable in the Company's common stock pursuant to paragraph 4(b) herein.

This Note is subject to the terms and conditions of the Securities Purchase Agreement between the Company and Holder (the "SPA") and the payment in full by Holder of the Buyer Note (as defined in the SPA). On payment of the Buyer Note in full, this Note is subject to the following additional provisions:

1. This Note is exchangeable for an equal aggregate principal amount of notes of different authorized denominations as requested by the Holder surrendering the same. No service charge will be made for such registration of transfer or exchange, except that Holder shall pay any tax or other governmental charges payable in connection therewith.

2. The Company shall be entitled to withhold from all payments any amounts required to be withheld under applicable laws.

3. This Note may be transferred or exchanged only in compliance with the 1933 Act and applicable state securities laws. Any attempted transfer to a nonqualifying party shall be treated by the Company as void. Prior to due presentment for transfer of this Note, the Company and any agent of the Company may treat the person in whose name this Note is duly registered on the Company's records as the owner hereof for all other purposes, whether or not this Note is overdue, and neither the Company nor any such agent shall be affected or bound by notice to the contrary. Any Holder electing to exercise the right of conversion set forth in Section 4(a) hereof, and any prospective transferee of this Note, in addition to the requirements set forth in Section 4(a) is also required to give the Company written confirmation that this Note is being converted ("Notice of Conversion"), in the form annexed hereto as Exhibit A. The date of receipt of such Notice of Conversion shall be the Conversion Date.

B-1

 

	
Second Note (Backend)

	
Exhibit B

4.

(a) The Holder is entitled, at its option, at any time after 180 days after the Issue Date, to convert all or any amount of the principal face amount of this Note then outstanding into shares of the Company's common stock (the "Conversion Shares"), without restrictive legend of any nature, at a price ("Conversion Price") for each Conversion Share equal to 50% of the lowest closing bid price of the Company's common stock as reported on the OTCQB marketplace upon which the Company's common stock is traded or any market upon which the common stock may be traded in the future ("Exchange"), for the 30 prior trading days including the day upon which a Notice of Conversion is received by the Company (provided such Notice of Conversion is delivered to the Company after 4 P.M. Eastern Standard or Daylight Savings Time if the Holder wishes to include the same day closing price). If the Conversion Shares have not been delivered within three business days, the Notice of Conversion may be rescinded. Such conversion shall be effectuated by the Company delivering the Conversion Shares to the Holder within three business days of receipt by the Company of the Notice of Conversion. Once the Holder has received such Conversion Shares, the Holder shall surrender this Note to the Company, executed by the Holder evidencing such Holder's intention to convert this Note or a specified portion hereof, and accompanied by proper assignment hereof in blank. Accrued, but unpaid, interest shall be subject to conversion. No fractional shares or scrip representing fractions of shares will be issued on conversion, but the number of shares issuable shall be rounded to the nearest whole share. In the event the Company experiences a DTC "Chill" on its common stock, the Conversion Price shall be decreased to 25% instead of 50% while that Chill is in effect.

(b) Interest on any unpaid principal balance of this Note shall be paid at the rate of 12% per annum. Interest shall be paid by the Company in Conversion Shares. Holder may, at any time, send in a Notice of Conversion to the Company for Conversion Shares based on the formula provided in Section 4(a) above. The dollar amount converted into Conversion Shares shall be all or a portion of the accrued interest calculated on the unpaid principal balance of this Note to the date of such notice.

(c) This Note may be prepaid within 180 days after the Issue Date at 150% of the face amount plus any accrued interest. This Note may not be prepaid after the 180th day. Such redemption must be closed and funded within three days of giving notice of redemption or the right to redeem shall be null and void. Notwithstanding the above, this Note may be paid in full on or 10 business days prior to the Maturity Date by paying the original principal amount of this Note (or the principal amount then owing) plus any accrued and unpaid interest through the payment date.

(d) Upon: (i) a transfer of all or substantially all of the assets of the Company to any person in a single transaction or series of related transactions; (ii) a reclassification, capital reorganization, or other change or exchange of outstanding shares of the Company's common stock, other than a forward or reverse stock split or stock dividend; or (iii) any consolidation or merger of the Company with or into another person or entity in which the Company is not the surviving entity (other than a merger effected solely to change the jurisdiction of incorporation of the Company and results in a reclassification, conversion or exchange of outstanding shares of the Company's common stock solely into shares of common stock) (each of items (i), (ii), and (iii) being referred to as a "Sale Event"), then, in each case, the Company shall, upon request of the Holder, redeem this Note in cash for 150% of the principal amount, plus accrued but unpaid interest through the date of redemption, or at the election of the Holder, such Holder may convert the unpaid principal amount of this Note (together with the amount of accrued but unpaid interest) into Conversion Shares immediately prior to such Sale Event at the Conversion Price.

 

B-2

 

	
Second Note (Backend)

	
Exhibit B

(e) In case of any Sale Event (not to include a sale of all or substantially all of the Company's assets) in connection with which this Note is not redeemed or converted, the Company shall cause an effective provision to be made to allow the Holder of this Note the right thereafter, by converting this Note, to purchase or convert this Note into the kind and number of shares of stock or other securities or property (including cash) receivable upon such reclassification, capital reorganization or other change, consolidation or merger by a holder of the number of Conversion Shares that could have been issued upon conversion of the Note and at the same Conversion Price defined in this Note immediately prior to such Sale Event. The foregoing shall similarly apply to successive Sale Events. If the consideration received by the holders of the Company's common stock is other than cash, the value shall be as determined by the board of directors of the Company or successor person or entity acting in good faith.

5. No provision of this Note shall alter or impair the obligation of the Company, which is absolute and unconditional, to pay the principal of, and interest on, this Note at the time, place, rate, and in the form, herein prescribed.

6. The Company hereby expressly waives demand and presentment for payment, notice of nonpayment, protest, notice of protest, notice of dishonor, notice of acceleration or intent to accelerate, and diligence in taking any action to collect amounts called for hereunder and shall be directly and primarily liable for the payment of all sums owing and to be owing hereto.

7. The Company agrees to pay all costs and expenses, including reasonable attorneys' fees and expenses, that may be incurred by the Holder in collecting any amount due under this Note.

8. If one or more of the following described "Events of Default" shall occur:

(a) the Company shall default in the payment of principal or interest on this Note or any other note issued to the Holder by the Company;

(b) any of the representations or warranties made by the Company herein or in any certificate or financial or other written statements heretofore or hereafter furnished by or on behalf of the Company in connection with the execution and delivery of this Note, or the Securities Purchase Agreement under which this Note was issued, shall be false or misleading in any respect;

(c) the Company shall fail to perform or observe, in any respect, any covenant, term, provision, condition, agreement, or obligation of the Company under this Note or any other note issued to the Holder;

(d) the Company shall: (i) become insolvent; (ii) admit in writing its inability to pay its debts generally as they mature; (iii) make an assignment for the benefit of creditors or commence proceedings for its dissolution; (iv) apply for or consent to the appointment of a trustee, liquidator, or receiver for its or for a substantial part of its property or business; (v) file a petition for bankruptcy relief, consent to the filing of such petition, or have filed against it an involuntary petition for bankruptcy relief, all under federal or state laws as applicable;

(e) a trustee, liquidator, or receiver shall be appointed for the Company or for a substantial part of its property or business without its consent and shall not be discharged within 60 days after such appointment;

B-3

 

	
Second Note (Backend)

	
Exhibit B

(f) any governmental agency or any court of competent jurisdiction at the instance of any governmental agency shall assume custody or control of the whole or any substantial portion of the properties or assets of the Company;

(g) one or more money judgments, writs or warrants of attachment, or similar process, in excess of $25,000 in the aggregate, shall be entered or filed against the Company or any of its properties or other assets and shall remain unpaid, unvacated, unbonded, or unstayed for a period of 15 days or in any event later than five days prior to the date of any proposed sale thereunder;

(h) the Company shall have defaulted on or breached any term of any other note or similar debt instrument into which the Company has entered and failed to cure such default within the appropriate grace period;

(i) the Company shall have its common stock delisted from a market (including the OTCQB marketplace) or, if the common stock trades on an Exchange, then trading in the common stock shall be suspended for more than 10 consecutive days;

(j) if a majority of the members of the board of directors of the Company on the date hereof are no longer serving as members of the Board;

(k) the Company shall not deliver to the Holder the Conversion Shares pursuant to Section 4 herein, without restrictive legend, within three business days of its receipt of a Notice of Conversion;

(l) the Company shall not replenish the reserve set forth in Section 12, within three business days of the request of the Holder;

(m) the Company shall not be "current" in its filings with the U.S. Securities and Exchange Commission; or

(n) the Company shall lose the "bid" price for its stock and a market (including the OTCQB marketplace or other Exchange); then, or at any time thereafter, unless cured within 10 days, and in each and every such case, unless such Event of Default shall have been waived in writing by the Holder (which waiver shall not be deemed to be a waiver of any subsequent default) at the option of the Holder and in the Holder's sole discretion, the Holder may consider this Note immediately due and payable, without presentment, demand, protest, or (further) notice of any kind (other than notice of acceleration), all of which are hereby expressly waived, anything herein contained to the contrary notwithstanding, and the Holder may immediately, and without expiration of any period of grace, enforce any and all of the Holder's rights and remedies provided herein or any other rights or remedies afforded by law. Upon an Event of Default, interest shall accrue at a default interest rate of 15% per annum or, if such rate is usurious or not permitted by current law, then at the highest rate of interest permitted by law. In the event of a breach of Section 8(k) and the Conversion Shares are not issued within three days, the penalty shall be $1,000 per day beginning on the 4th day after the Conversion Notice was delivered to the Company. This penalty shall increase to $2,000 per day beginning on the 10th day. The penalty for a breach of Section 8(n) shall be an increase of the outstanding principal amounts by 200%. In case of a breach of Section 8(i), the outstanding principal due under this Note shall increase by 200%. If this Note is not paid on or within 10 business days of the Maturity Date, the outstanding principal due under this Note shall increase by 200%.

B-4

 

	
Second Note (Backend)

	
Exhibit B

If the Holder shall commence and prevail in an action or proceeding to enforce any provisions of this Note, the Holder shall be reimbursed by the Company for its attorneys' fees and other costs and expenses incurred in the investigation, preparation, and prosecution of such action or proceeding.

9. In case any provision of this Note is held by a court of competent jurisdiction to be excessive in scope or otherwise invalid or unenforceable, such provision shall be adjusted rather than voided, if possible, so that it is enforceable to the maximum extent possible, and the validity and enforceability of the remaining provisions of this Note will not in any way be affected or impaired thereby.

10. Neither this Note nor any term hereof may be amended, waived, discharged, or terminated other than by a written instrument signed by the Company and the Holder.

11. The Company represents that it is not a "shell" issuer and has never been a "shell" issuer or that if it previously has been a "shell" issuer, that at least 12 months have passed since the Company has reported Form 10 type information indicating it is no longer a "shell" issuer. The Company will instruct its counsel to write a Rule 144-3(a)(9) opinion to allow for salability of the Conversion Shares or accept such an opinion from Holder's counsel.

12. The Company shall issue irrevocable transfer agent instructions reserving 1,000,000 shares of its common stock for conversions under this Note (the "Share Reserve"). The Share Reserve shall be replenished as needed to allow for conversions of this Note. Upon full conversion of this Note, any shares remaining shall be released from the Share Reserve. The Company shall pay all costs associated with issuing and delivering the Conversion Shares.

13. The Company will give the Holder direct notice of any corporate actions, including name changes, stock splits, recapitalizations etc. This notice shall be given to the Holder as soon as possible under law.

14. This Note shall be governed by and construed in accordance with the laws of California applicable to contracts made and wholly to be performed within the state of California and shall be binding upon the successors and assigns of each party hereto. The Holder and the Company hereby mutually waive trial by jury and consent to exclusive jurisdiction and venue in the courts of the state of California. This Agreement may be executed in counterparts, and the facsimile transmission of an executed counterpart to this Agreement shall be effective as an original.

B-5

 

	
Second Note (Backend)

	
Exhibit B

IN WITNESS WHEREOF, the Company has caused this Note to be duly executed by an officer thereunto duly authorized.

 

Dated: March 18, 2016

CANNASYS, INC.

By: ___________________________

Michael A. Tew, Chief Executive Officer

B-6

 

	
Second Note (Backend)

	
Exhibit B

EXHIBIT A

NOTICE OF CONVERSION

(to be executed by the registered holder in order to convert the note)

The undersigned hereby irrevocably elects to convert $___________ of the above Note into _________ shares of common stock of Cannasys, Inc. ("Conversion Shares") according to the conditions set forth in such Note, as of the date written below. If the Conversion Shares are to be issued in the name of a person other than the undersigned, the undersigned will pay all transfer and other taxes and charges payable with respect thereto.

	
Date of Conversion:

	 
	 	 
	
Applicable Conversion Price:

	 
	 	 
	
Signature:

	 
	 	 
	
Shares are to be registered in the following name:

	 
	 	 
	
Name:

	 
	 	 
	
Address:

	 
	 	 
	
EIN:

	 
	 	 
	
Shares are to be sent to the following account:

	 
	 	 
	
Account Name:

	 
	 	 
	
Address:

	 
	 	 

B-7

	
Buyer Note

	
Exhibit C

 

THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT"), OR UNDER THE SECURITIES LAWS OF ANY STATE. THESE SECURITIES ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE AND MAY NOT BE TRANSFERRED OR RESOLD EXCEPT AS PERMITTED UNDER THE 1933 ACT AND THE APPLICABLE STATE SECURITIES LAWS, PURSUANT TO REGISTRATION OR EXEMPTION THEREFROM. LENDER SHOULD BE AWARE THAT IT MAY BE REQUIRED TO BEAR THE FINANCIAL RISKS OF THIS INVESTMENT FOR AN INDEFINITE PERIOD OF TIME. THE ISSUER OF THESE SECURITIES MAY REQUIRE AN OPINION OF COUNSEL IN FORM AND SUBSTANCE SATISFACTORY TO THE ISSUER TO THE EFFECT THAT ANY PROPOSED TRANSFER OR RESALE IS IN COMPLIANCE WITH THE 1933 ACT AND ANY APPLICABLE STATE SECURITIES LAWS.

$50,000

KODIAK CAPITAL GROUP, LLC

COLLATERALIZED SECURED PROMISSORY NOTE

BACK END NOTE

ISSUE DATE:  MARCH 18, 2016

FOR VALUE RECEIVED, Kodiak Capital Group, LLC, a Delaware limited liability company (the "Company"), hereby absolutely and unconditionally promises to pay to CannaSys, Inc. (the "Lender"), or order, the principal amount of Fifty Thousand Dollars ($50,000) no later than December 18, 2016, unless the Lender does not meet the "current information requirements" required under Rule 144 of the 1933 Act, in which case the Company may declare the offsetting Second Note (as defined below) issued by the Lender on the same date herewith to be in default (as defined in that note) and cross cancel its payment obligations under this Note as well as the Lender's payment obligations under the offsetting note. This Note is issued under the terms and conditions of the Securities Purchase Agreement between the Company and Lender of even date herewith (the "SPA") and is the "Buyer Note" as defined in the SPA. The capitalized terms used in this Note and not otherwise defined herein have the meanings given them in the SPA.

1. Repayments and Prepayments; Security.

a. All principal under this Note shall be due and payable no later than March 18, 2017, unless the Lender does not meet the "current information requirements" required under Rule 144 of the 1933 Act, in which case the Company may declare the Second Note (as defined below) to be in default (as defined in the Second Note) and cross cancel its payment obligations under this Note as well as the Lender's payment obligations under the Second Note.

b. The Company may pay this Note on written request by Lender. This Note may not be assigned by the Lender, except by operation of law.

c. This Note is subject to the terms and conditions of the SPA and is secured by the pledge of the $50,000 12% Convertible Redeemable Promissory Note issued to the Company by the Lender on even date herewith (the "Second Note"). The Company may exchange this collateral for other collateral with an appraised value of at least $50,000, by providing five days' prior written notice to the Lender. If the Lender does not object to the substitution of collateral in that five-day period, such substitution of collateral shall be deemed to have been accepted by the Lender. All collateral shall be retained by Disruptive Ventures, LLC, a Delaware limited liability company with offices at 260 Newport Center Drive, Newport Beach, CA 92660 which shall act as the escrow agent for the collateral for the benefit of the Lender. The Company may not effect any conversions under the Second Note until it has made full cash payment for the portion of the Second Note being converted.

C-1

	
Buyer Note

	
Exhibit C

2. Events of Default; Acceleration.

a. The principal amount of this Note is subject to prepayment, in whole or in part, upon the occurrence and during the continuance of any of the following events (each, an "Event of Default"): the initiation of any bankruptcy, insolvency, moratorium, receivership, or reorganization by or against the Company or a general assignment of assets by the Company for the benefit of creditors. Upon the occurrence of an Event of Default, the entire unpaid principal balance of this Note and all of the unpaid interest accrued thereon shall be immediately due and payable. The Company may offset amounts due to the Lender under this Note by similar amounts that may be due to the Company by the Lender resulting from breaches under the Second Note.

b. No remedy herein conferred upon the Lender is intended to be exclusive of any other remedy, and each and every remedy shall be cumulative and in addition to every other remedy hereunder, now or hereafter existing at law, in equity, or otherwise. The Company accepts and agrees that this Note is a full-recourse note and that the Lender may exercise any and all remedies available to it under law.

3. Notices. All notices, demands, requests, reports, and other communications required or permitted hereunder shall be in writing and shall be deemed to have been given as of the date so delivered, if personally delivered; as of the date so sent, if sent by electronic mail and receipt is acknowledged by the recipient; one day after the date so sent, if delivered by overnight delivery service; or three days after the date so mailed, if mailed by U.S. mail, in which event it may be mailed by first-class, certified or registered, return receipt requested, postage prepaid, addressed: (i) if to Lender, at the address Lender shall have furnished the Company in writing; and (ii) if to the Company, at the address Company shall have furnished to Lender in writing.

4. Miscellaneous.

a. Neither this Note nor any provisions hereof may be changed, waived, discharged, or terminated orally other than by a written instrument signed by the Company and Lender.

b. No failure or delay by the Lender to exercise any right hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any right, power, or privilege preclude any other right, power, or privilege. The provisions of this Note are severable and if any one provision hereof shall be held invalid or unenforceable in whole or in part in any jurisdiction, such invalidity or unenforceability shall affect only such provision in such jurisdiction. This Note expresses the entire understanding of the parties respecting the transactions contemplated hereby. The Company and every endorser and guarantor of this Note regardless of the time, order, or place of signing hereby waives presentment, demand, protest, and notice of every kind, and assents to any extension or postponement of the time for payment or any other indulgence, to any substitution, exchange, or release of collateral, and to the addition or release of any other party or person primarily or secondarily liable.

c. If Lender retains an attorney for collection of this Note, or if any suit or proceeding is brought for the recovery of all, or any part of, or for protection of the indebtedness respected by this Note, then the Company agrees to pay all costs and expenses of the suit or proceeding, or any appeal thereof, incurred by the Lender, including without limitation, reasonable attorneys' fees.

d. This Note shall for all purposes be governed by, and construed in accordance with, the laws of the state of California (without reference to conflict of laws).

e. This Note shall be binding upon the Company's successors and assigns and shall inure to the benefit of the Lender's successors and assigns.

C-2

	
Buyer Note

	
Exhibit C

IN WITNESS WHEREOF, the Company has caused this Note to be executed by its duly authorized officer to take effect as of the date first hereinabove written.

KODIAK CAPITAL GROUP, LLC.

	
By:

	 
	
Name:

	 
	
Its:

	 

 

  

C-3Exhibit 10.1

 

STOCK PURCHASE AGREEMENT

 

by and among

 

JANEL
CORPORATION,

 

indCo,
inc.,

 

and

 

tennessee
valley ventures ii, l.p

 

Dated as of March 21,
2016

Effective as of March 1, 2016

 

     

     

    

 

Table of Contents

 

	 	 	Page
	 	 	 
	Article I PURCHASE AND SALE OF THE STOCK; CLOSING	1
	Section 1.1	Transfer of Stock; Further Assurances	1
	Section 1.2	Closing	1
	Section 1.3	Purchase Price and Payment	1
	Section 1.4	Post-Closing Adjustments	3
	Section 1.5	Withholding	4
	Section 1.6	Purchase Price	4
	 	 	 
	Article II REPRESENTATIONS AND WARRANTIES OF THE COMPANY AND TVV	5
	Section 2.1	Organization and Power	5
	Section 2.2	Authorization	5
	Section 2.3	Non-Contravention	6
	Section 2.4	Capitalization	6
	Section 2.5	Subsidiaries and Investments	6
	Section 2.6	Financial Statements; Accounting Controls	6
	Section 2.7	Absence of Undisclosed Liabilities	6
	Section 2.8	Absence of Certain Developments	7
	Section 2.9	Accounts Receivable; Accounts Payable.	8
	Section 2.10	Transactions with Affiliates	8
	Section 2.11	Title to and Encumbrances on Properties	8
	Section 2.12	Tax Matters	9
	Section 2.13	Certain Contractual Obligations	10
	Section 2.14	Intellectual Property	11
	Section 2.15	Litigation	11
	Section 2.16	Employee and Labor Matters	11
	Section 2.17	Company Licenses; Compliance with Laws	12
	Section 2.18	Employee Benefits	12
	Section 2.19	Insurance Coverage	13
	Section 2.20	Investment Banking; Brokerage	13
	Section 2.21	Environmental Matters	13
	Section 2.22	Suppliers; Customers	14
	Section 2.23	Indebtedness	14
	Section 2.24	Illegal Payments	14
	Section 2.25	Products.	14
	Section 2.26	Full Disclosure	14
	 	 	 
	Article III REPRESENTATIONS AND WARRANTIES OF TVV	14
	Section 3.1	Stock; Closing Date Payment.	14
	Section 3.2	Authority	15
	Section 3.3	No Conflict; Consents	15
	Section 3.4	Brokers	15
	Section 3.5	Litigation	15
	 	 	 
	Article IV REPRESENTATIONS AND WARRANTIES OF THE BUYER	15
	Section 4.1	Organization and Power	15
	Section 4.2	Authorization	15
	Section 4.3	Non-Contravention	16
	Section 4.4	Brokers	16
	Section 4.5	Litigation	16

 

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	Section 4.6	Hennis Stock Redemption	22
	 	 	 
	Article V ADDITIONAL AGREEMENTS	16
	Section 5.1	Press Releases	16
	Section 5.2	Tax Matters	16
	Section 5.3	Books and Records	18
	Section 5.4	Further Action	18
	Section 5.5	Non-Disclosure, Non-Competition and Non-Solicitation	18
	Section 5.6	General Waiver and Release	19
	 	 	 
	Article VI SURVIVAL; INDEMNIFICATION	19
	Section 6.1	Survival of Representations, Warranties and Covenants	19
	Section 6.2	Indemnification	20
	Section 6.3	Notice; Payment of Losses; Defense of Claims	22
	Section 6.4	Characterization of Indemnity Payments	23
	Section 6.5	Limitation on Contribution and Certain Other Rights; No Circular Indemnity; Waiver of Rights	24
	Section 6.6	Exclusivity of Indemnification	24
	 	 	 
	Article VII GENERAL PROVISIONS	24
	Section 7.1	Notices	24
	Section 7.2	Disclosure Schedules	25
	Section 7.3	Assignability; Binding Agreement; Third Party Beneficiary	25
	Section 7.4	Severability	25
	Section 7.5	No Agreement Until Executed	25
	Section 7.6	Certain Definitions	25
	Section 7.7	Interpretation	29
	Section 7.8	Fees and Expenses	29
	Section 7.9	Governing Law	29
	Section 7.10	Specific Performance	29
	Section 7.11	Venue; Consent to Jurisdiction	30
	Section 7.12	Mutual Drafting	30
	Section 7.13	Integration	30
	Section 7.14	Counterparts	30
	Section 7.15	Amendments, Waivers and Consents	30

 

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	ANNEXES	 
	Annex A	List of Defined Terms
	 	 
	EXHIBITS	 
	Exhibit A	Stock
	Exhibit B	Form of Escrow Agreement
	Exhibit C	Sample Net Working Capital Calculation
	 	 
	SCHEDULES	 
	Schedule 1.3(b)	Estimated Indebtedness
	Schedule 2.3	Non-Contravention
	Schedule 2.4	Capitalization
	Schedule 2.5	Loans
	Schedule 2.6(a)	Financial Statements
	Schedule 2.6(b)	Exceptions to Financial Statements
	Schedule 2.7	Absence of Undisclosed Liabilities
	Schedule 2.8	Absence of Certain Developments
	Schedule 2.10	Transactions with Affiliates
	Schedule 2.11(a)	Leased Real Properties
	Schedule 2.11(b)	Title to and Encumbrances on Properties
	Schedule 2.13(a)	Certain Contractual Obligations
	Schedule 2.13(b)	Noncompliance with Material Contracts
	Schedule 2.14	Intellectual Property
	Schedule 2.15	Litigation
	Schedule 2.16	Employee and Labor Matters
	Schedule 2.17	Company Licenses; Compliance with Laws
	Schedule 2.18	Employee Benefits
	Schedule 2.19	Insurance Coverage
	Schedule 2.20	Investment Banking; Brokerage
	Schedule 2.21	Environmental Matters
	Schedule 2.22	Suppliers; Customers
	Schedule 2.23	Indebtedness
	Schedule 2.25(a)	Product Warranties
	Schedule 2.25(b)	Customer Pricing
	Schedule 3.3	No Conflicts; Consents

 

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STOCK PURCHASE AGREEMENT

 

This STOCK PURCHASE
AGREEMENT (this “Agreement”) is dated as of March 21, 2016, by and among JANEL CORPORATION, a Nevada corporation
(the “Buyer”), INDCO, INC., a Tennessee corporation (the “Company”), and Tennessee Valley
Ventures II, L.P., a Delaware limited partnership (“TVV”). Certain terms used in this Agreement are defined
in Section 7.6 hereof. An index of defined terms used in this Agreement is attached as Annex A hereto.

 

WHEREAS, TVV and C.
Mark Hennis (“Hennis”) (collectively, the “Stockholders”) own beneficially and of record
all of the outstanding shares of common stock of the Company, with TVV owning 97.07% of the outstanding shares of common stock
of the Company; and

 

WHEREAS, TVV desires
to sell to the Buyer, and the Buyer desires to purchase from TVV, the 601,042 shares of common stock of the Company set forth under
the heading “Shares of Stock” on Exhibit A attached hereto (the “Stock”) on the terms and
conditions set forth herein (the “Stock Purchase”).

 

NOW THEREFORE, in consideration
of the mutual agreements and covenants herein contained, and for other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the parties hereto agree as follows:

 

Article
I

PURCHASE AND SALE OF THE STOCK; CLOSING

 

Section 1.1           Transfer
of Stock; Further Assurances. Subject to the terms and conditions set forth herein, at the Closing, the Buyer shall purchase,
acquire and accept from the TVV, and TVV shall sell, transfer, assign, convey and deliver to the Buyer, all right, title and interest
in and to the Stock, free and clear of any and all Encumbrances. For the avoidance of doubt, the Stock so purchased does not include
the 18,125 shares of common stock of the Company set forth under the heading “Shares of Rollover Stock” on Exhibit
A, which shall be retained by Hennis as set forth on Exhibit A. TVV shall on the Closing Date execute and deliver to
the Buyer and the Company stock certificates accompanied by executed stock powers sufficient to transfer, convey, and assign the
Stock to the Buyer.

 

Section
1.2           Closing. The closing of the transactions contemplated
by this Agreement (the “Closing”) shall take place concurrently with the execution of this Agreement on the
date hereof (the “Closing Date”). Notwithstanding the actual Closing Date, the Closing shall be effective as
of 12:01 a.m. (Eastern Time) on March 1, 2016 (the “Effective Date”). In lieu of an in person Closing,
the Closing may instead be accomplished by facsimile or email (in PDF format) transmission to the respective offices of legal
counsel for the parties of the requisite documents, duly executed where required, delivered upon actual confirmed receipt.

 

Section 1.3           Purchase
Price and Payment.

 

(a)          The
parties hereby agree that, at the Closing and in consideration of the sale by TVV to the Buyer of the Stock and in reliance upon
the representations and warranties of the parties herein contained and subject to the satisfaction of all of the conditions contained
herein, the Buyer shall pay to TVV an aggregate amount of cash (the “Closing Date Payment”) equal to:

 

(i)          $11,000,000,
which includes a $50,000 non-refundable amount deposited by Buyer with McKenzie Laird, PLLC on March 15, 2016; plus

 

(ii)         an
amount equal to the Estimated Cash and Cash Equivalents (as defined in Section 1.3(e)); plus

 

(iii)        $100,000,
minus the amount of the loan payment made to Pinnacle Bank on March 1, 2016, as consideration for the period from March 1,
to the Closing Date; plus

 

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(iv)        if
the Estimated Working Capital (as defined in Section 1.3(e)) is greater than the Target Working Capital, then an amount
equal to the difference between the Estimated Working Capital and the Target Working Capital; minus

 

(v)         an
amount equal to the Estimated Indebtedness (as defined in Section 1.3(e)); minus

 

(vi)        an
amount equal to the Estimated Company Expenses (as defined in Section 1.3(e)); minus

 

(vii)       if
the Estimated Working Capital is less than the Target Working Capital, then an amount equal to the difference between the Target
Working Capital and the Estimated Working Capital; minus

 

(viii)      the
Escrow Amount (as defined in Section 1.3(d)); and minus

 

(ix)         the
Rollover Amount.

 

(b)          At
the Closing, the Buyer shall, on behalf of the Company, repay, or shall cause to be repaid, the Estimated Indebtedness set forth
on Schedule 1.3(b). The Buyer and the Company will cooperate in arranging for such repayment and shall take such reasonable
actions as may be necessary to facilitate such repayment and to facilitate the release, in connection with such repayment, of any
Encumbrances securing the Indebtedness.

 

(c)          At
the Closing, the Buyer shall, on behalf of the Company or TVV, pay all Estimated Company Expenses.

 

(d)          At
the Closing, Buyer shall deposit $500,000.00 (the “Escrow Amount”) into an interest-bearing escrow account at
Fifth Third Bank (the “Escrow Agent”). The Escrow Agent shall hold the Escrow Amount and all interest and other
amounts earned thereon in an escrow account (the “Escrow Account”) for purposes of securing any amounts payable
by TVV on account of indemnification obligations under Section 6.2(a) hereof and certain other amounts payable hereunder
in accordance with this Agreement and the agreement among TVV, the Buyer, and the Escrow Agent in substantially the form set forth
in Exhibit B attached hereto (the “Escrow Agreement”).

 

(i)          Within
five (5) Business Days following the ninetieth (90th) day after the Closing Date (the “Release Date”),
the Escrow Amount, minus (x) the amount of any Losses previously offset against the Escrow Amount pursuant to the Escrow Agreement
and Section 6.3 hereof, minus (y) the amount of any costs and expenses previously paid out of the Escrow Account in accordance
with this Agreement, and minus (z) the amount of any indemnity claims asserted by the Buyer Indemnified Parties in good faith pursuant
to Section 6.2 prior to the Release Date and which remain in dispute as of the Release Date (any amount described in
clause (z) of this sentence, an “Unresolved Amount”), shall be released from the Escrow Account and paid over
to TVV, by confirmed wire transfer of immediately available funds, with the costs of such disbursement paid from the Escrow Account.
In the event it is finally determined, in accordance with Article VI, that any Unresolved Amount withheld from release
pursuant to the preceding sentence is not subject to indemnification by the Seller Indemnifying Parties under Section 6.2,
such amount shall be released from the Escrow Account and paid over to TVV, by confirmed wire transfer of immediately available
funds, within five (5) Business Days following such determination.

 

(ii)         The
Buyer, on one hand, and TVV, on the other hand, shall each pay fifty percent (50%) of the fees, expenses and costs associated with
establishing and maintaining the Escrow Account in accordance with this Agreement and the Escrow Agreement, provided that the costs
of disbursements shall be paid from the Escrow Account.

 

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(iii)        The
Buyer and TVV agree to promptly provide the Escrow Agent with jointly executed written instructions to disburse or retain the Escrow
Amount (or a portion thereof, as applicable) from the Escrow Account in accordance with this Agreement and the Escrow Agreement.

 

(e)          The
Company has delivered to the Buyer a statement (the “Estimated Closing Statement”) containing the Company’s
good faith estimates of the Company’s (i) Cash and Cash Equivalents as of the Adjustment Time (the “Estimated Cash
and Cash Equivalents”), outstanding Indebtedness as of the Adjustment Time, excluding the indebtedness evidenced by the
Hennis Redemption Note (the “Estimated Indebtedness”), Net Working Capital, which shall be consistent with the
sample calculation set forth in Exhibit C, as of the Adjustment Time (the “Estimated Working Capital”),
outstanding Company Expenses as of the Adjustment Time (the “Estimated Company Expenses”), and (ii) calculation
of the Closing Date Payment based on such estimates.

 

Section 1.4           Post-Closing
Adjustments.

 

(a)          Within
ninety (90) days following the Closing Date, the Buyer shall prepare and deliver to TVV a written statement (the “Closing
Statement”) which shall include (i) the Buyer’s calculations of the Company’s (A) Cash and Cash Equivalents
as of the Adjustment Time, (B) Indebtedness outstanding as of the Adjustment Time, excluding the indebtedness evidenced by the
Hennis Redemption Note, (C) Net Working Capital as of the Adjustment Time and (D) Company Expenses outstanding as of the Adjustment
Time and (ii) the Buyer’s calculation of the Closing Date Payment based upon the Closing Statement (including provision for
a 2.93% adjustment for the Rollover Amount). The Closing Statement (and the components thereof) will be prepared and determined
in accordance with GAAP as modified by the definitions of Cash and Cash Equivalents, Indebtedness (excluding the Hennis Redemption
Note), Company Expenses and Net Working Capital (and the Net Working Capital calculation shall be consistent with the sample working
capital calculation set forth on Exhibit C). The preparation of the Closing Statement shall be for the sole purpose of determining
the Final Closing Date Payment (as defined below). TVV shall have thirty (30) days following the receipt of the Closing Statement
(the “Review Period”) to review the same. On or before the expiration of the Review Period, TVV shall deliver
to the Buyer a written statement setting forth in reasonable detail (y) any specific item on the Closing Statement which TVV believes
has not been prepared in accordance with this Agreement and the correct amount of such specific item and (z) TVV’s alternative
calculation of the Closing Date Payment (the “Closing Statement Response Notice”). Any items not specifically
objected to in the Closing Statement Response Notice will be deemed to have been accepted by, and will be binding and conclusive
on, TVV on the thirtieth (30th) day following delivery of the Closing Statement to TVV. If TVV does not deliver such Closing
Statement Response Notice to the Buyer within the Review Period, TVV shall be deemed to have accepted the Closing Statement in
its entirety and the Closing Statement (and the determination of the Closing Date Payment set forth therein) shall be binding and
conclusive on the parties and not subject to appeal.

 

(b)          The
amount of the Closing Date Payment set forth on the Closing Statement, as accepted or deemed accepted under Section 1.4(a)
or as determined in accordance with Section 1.4(c), shall constitute the “Final Closing Date Payment”
for purposes of this Agreement.

 

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(c)          In
the event that TVV delivers a Closing Statement Response Notice within the Review Period, the Buyer and TVV shall in good faith
attempt to resolve any specific objections set forth in such Closing Statement Response Notice. Any such specific objections which
cannot be resolved between the Buyer and TVV within thirty (30) days following the Buyer’s receipt of the Closing Statement
Response Notice shall be resolved in accordance with this Section 1.4(c); provided, that neither the Buyer nor TVV
shall be permitted to raise any objection to the Estimated Closing Statement or the Closing Statement, as applicable, unless such
objection is raised in the Closing Statement or the Closing Statement Response Notice, respectively, as opposed to any amendment
or restatement thereof, none of which shall be permitted. Should TVV and the Buyer not be able to resolve such specific objections
set forth in the Closing Statement Response Notice (such specific unresolved items, the “Outstanding Disputed Items”),
within the thirty (30) day period described above, either party may submit only the Outstanding Disputed Items to Crowe Horwath
LLP (the “Accounting Referee”) for review and resolution, with instructions to complete the same as promptly
as practicable, but in any event within thirty (30) days of its engagement. If any Outstanding Disputed Item is submitted to the
Accounting Referee for resolution, the Accounting Referee shall determine, based solely on written submissions or presentations
by the Buyer and TVV and their respective Representatives and not by independent review, the value of the Outstanding Disputed
Items. In determining such amounts, the Accounting Referee: (A) shall be bound by the principles set forth in this Section 1.4,
and (B) shall not assign a value to any item greater than the greatest value for such item claimed by any party in the Closing
Statement or the Closing Statement Response Notice, as applicable, or less than the smallest value for such item claimed by any
party in the Closing Statement or the Closing Statement Response Notice, as applicable. Such Accounting Referee shall review only
the Outstanding Disputed Items and shall deliver a written statement setting forth its resolution of the dispute, which statement
shall include its calculation of: (1) Cash and Cash Equivalents as of the Adjustment Time, (2) Indebtedness outstanding as of the
Adjustment Time, (3) Net Working Capital as of the Adjustment Time, and (4) Company Expenses outstanding as of the Adjustment Time
and the Closing Date Payment, each calculated using non-disputed items and the Accounting Referee’s determinations of the
Outstanding Disputed Items. Such calculations, absent manifest error, shall be determinative of the Final Closing Date Payment
and shall be binding and conclusive on the parties and not subject to appeal. The fees and costs of the Accounting Referee, if
one is required, shall be payable one-half (1/2) by the Buyer, on the one hand, and one-half (1/2) by TVV, on the other hand.

 

(d)          In
the event that the Final Closing Date Payment is less than the Closing Date Payment, TVV shall pay such shortfall amount to the
Buyer by wire transfer of immediately available funds. In the event the Final Closing Date Payment exceeds the Closing Date Payment,
the Buyer shall pay to TVV an amount in cash equal to such excess amount. Any payment due under this Section 1.4(d) shall
be made within five (5) Business Days of the determination of the Final Closing Date Payment.

 

Section 1.5           Withholding.
The Buyer shall be entitled to deduct and withhold from the Purchase Price, including, for the avoidance of doubt, any adjustment
to the Purchase Price pursuant to Section 1.4, and any other payment under this Agreement, any withholding Taxes or other
amounts required under the Code or any Law to be deducted and withheld. To the extent that any such amounts are so deducted or
withheld, such amounts will be treated for all purposes of this Agreement as having been paid to the Person in respect of which
such deduction and withholding was made.

 

Section 1.6           Purchase
Price. All amounts paid by the Buyer to or on behalf of the Company or TVV under this Agreement and the Escrow Agreement,
including the Closing Date Payment, are referred to herein as the “Purchase Price”.

 

Section 1.7           Deliveries
at the Closing.

 

(a)          At
the Closing, TVV shall deliver the following items to the Buyer:

 

(i)          a
counterpart of this Agreement, duly executed by the Company and TVV;

 

(ii)         the
stock certificates representing the Stock and accompanied by an appropriate stock power, duly executed by TVV;

 

(iii)        resignations
of all directors and non-continuing officers of the Company;

 

(iv)        the
consents listed on Schedule 2.3, duly executed;

 

(v)         an
officer’s Certificate of the Company certifying as to (A) its Bylaws, as amended, (B) resolutions of each of the Company’s
stockholders and board of directors authorizing the transactions contemplated by this Agreement, and (C) a good standing certificate
issued as of a recent date by the Secretary of State of the States of Tennessee and Indiana;

 

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(vi)        the
Hennis Employment Agreement and the Wilberding Employment Agreement, duly executed by Hennis and Kris Wilberding (“Wilberding”);

 

(vii)       the
Escrow Agreement, duly executed by TVV;

 

(viii)      the
Charter and all amendments thereto of the Company, duly certified as of a recent date by the Secretary of State of Tennessee;

 

(ix)         documentation
satisfactory to the Buyer to release all Encumbrances (other than Permitted Encumbrances) on the Stock and the Company’s
assets; and

 

(x)          An
estoppel certificate and consent to assignment from the lessor under each Leased Real Property in form and substance reasonably
satisfactory to the Buyer.

 

(b)          At
the Closing, the Buyer shall deliver the following items to TVV:

 

(i)          the
Hennis Employment Agreement and the Wilberding Employment Agreement, duly executed by the Company;

 

(ii)         the
Escrow Agreement, duly executed by the Buyer and the Escrow Agent; and

 

(iii)        an
officer’s Certificate of the Buyer certifying as to (A) its Bylaws, as amended, (B) resolutions of the Buyer’s
board of directors authorizing the transactions contemplated by this Agreement, and (C) a good standing certificate issued by the
Secretary of State of the State of Nevada dated within five (5) Business Days of the Closing.

 

Article
II

REPRESENTATIONS AND WARRANTIES

OF THE COMPANY AND TVV 

 

In order to induce
the Buyer to enter into this Agreement and the other Transaction Agreements, the Company and TVV hereby jointly and severally make
the following representations and warranties contained in this Article II to the Buyer.

 

Section 2.1           Organization
and Power. The Company is a corporation duly organized, validly existing and in good standing under the Laws of Tennessee.
The Company has full corporate power and authority to own or lease its properties and to conduct its business in the manner and
in the places where such properties are owned or leased or such business is conducted by it. The Company is qualified to do business
as a foreign entity in the State of Indiana and is not required by any Law to be qualified or registered to do business as a foreign
corporation in any other jurisdiction. The Company has all required corporate power and authority to enter into and perform this
Agreement and the other Transaction Agreements to which it is a party and to carry out the transactions contemplated hereby and
thereby. Copies of the charter and by-laws or any other similar organizational or governing documents (collectively, the “Organizational
Documents”) of the Company have been delivered to the Buyer by the Company and are correct and complete in all respects
and no amendments thereto are pending.

 

Section
2.2           Authorization. The Company has full right, authority,
power and legal capacity to enter into this Agreement and the other Transaction Agreements executed and delivered by or on behalf
of the Company, and to carry out the transactions contemplated hereby and thereby. The execution, delivery and performance of
this Agreement and the other Transaction Agreements to which the Company is a party have been duly authorized by all necessary
corporate action of the Company. This Agreement and the other Transaction Agreements executed and delivered by or on behalf of
the Company have been duly executed and delivered by the Company, and, assuming due authorization, execution and delivery of this
Agreement and the other Transaction Agreements to which the Company is a party by the other parties hereto and thereto, this Agreement
and such other Transaction Agreements to which it is a party constitute legal, valid and binding obligations of the Company, enforceable
in accordance with their respective terms, subject only to General Enforceability Exceptions.

 

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Section 2.3           Non-Contravention.
The execution, delivery and performance by the Company of this Agreement and the other Transaction Agreements executed and delivered
by or on behalf of the Company, and the performance of the transactions contemplated by this Agreement and such other Transaction
Agreements did not, do not and will not: (a) violate or result in a violation of, conflict with or constitute or result in violation
of or a default (whether after the giving of notice, lapse of time or both) under any of the Organizational Documents of the Company;
(b) violate or result in a violation of, conflict with or constitute or result in violation of or a default (whether after the
giving of notice, lapse of time or both) or loss of benefit under or granted by, any provision of any Law, or any restriction
imposed by any Governmental Authority applicable to the Company; (c) except as set forth on Schedule 2.3, require the Company
to provide any notice to, make any declaration or filing with, or obtain the consent or approval of, any Governmental Authority
or other Person; (d) violate or result in a violation of or constitute a default (whether after the giving of notice, lapse of
time or both) under, give rise to or accelerate any obligation under, or give rise to a right of termination of or result in a
loss of benefit under any agreement, contract, instrument, mortgage, lien, lease, permit, license, authorization, order, writ,
judgment, injunction, decree, determination or arbitration award to which the Company is a party or by which any of the Company’s
assets or the Stock is bound, or result in the creation or imposition of any Encumbrance on any of the Company’s assets
or the Stock; or (e) result in TVV having the right to exercise dissenters’ appraisal rights.

 

Section 2.4           Capitalization.
Schedule 2.4 sets forth all of the authorized Equity Interests of the Company. All of the issued and outstanding Equity
Interests of the Company are owned beneficially and of record as set forth on Schedule 2.4, free and clear of any Encumbrances.
All of the issued and outstanding Equity Interests of the Company have been duly and validly issued, are fully paid and non-assessable
and were issued in compliance with all applicable securities Laws. Other than as set forth on Schedule 2.4, there are no
outstanding subscriptions, preemptive rights, rights of first refusal, agreements, arrangements or commitments of any kind for
or relating to the issuance, sale, registration or voting of, or outstanding securities convertible into or exchangeable for,
any Equity Interests of the Company. The Company has no obligation to purchase, redeem, or otherwise acquire any of its Equity
Interests. The powers, privileges and rights, and the qualifications, limitations or restrictions thereof in respect of the Stock
are as set forth in the Organizational Documents delivered to the Buyer.

 

Section 2.5           Subsidiaries
and Investments. The Company owns no Equity Interests in any other Person and has no outstanding loans or advances to or from
any officer, director or Equity Interest holder of the Company. The Company does not own, directly or indirectly, or have the
right or obligation (contingent or otherwise) to acquire, any Equity Interests in any other Person.

 

Section 2.6           Financial
Statements; Accounting Controls; Financial Projections.

 

(a)          The
Company has delivered to the Buyer the following financial statements, copies of which are attached hereto as Schedule 2.6(a)
(collectively, the “Financial Statements”): (i) the audited balance sheet of the Company as of December 31,
2014 (the “Base Balance Sheet”) and the audited statements of income, retained earnings, and cash flows for
the year then ended, (ii) the audited balance sheet of the Company as of December 31, 2013 and the audited statements of income,
retained earnings and cash flows for the year then ended, (iii) the unaudited balance sheet of the Company as of December 31,
2015 and the unaudited statements of income and cash flows for the twelve (12) month period then ended; and (iv) the unaudited
balance sheet of the Company as of February 29, 2016 and the unaudited statements of income and cash flows for the two (2)
month period then ended.

 

(b)          Except
as set forth on Schedule 2.6(b) and, with respect to the unaudited Financial Statements, subject to the absence of footnotes
and normal recurring year-end audit adjustments, (the effect of which will not be, individually or in the aggregate, material in
nature or amount), each of the Financial Statements (including the notes thereto, if any) is in all material respects accurate
and complete, is consistent with the books and records of the Company (which, in turn, are accurate and complete in all material
respects), has been in all material respects prepared in good faith and in accordance with GAAP consistently applied, and presents
fairly the financial condition of the Company as of the respective dates thereof and the operating results, cash flows and changes
in stockholders’ equity of the Company for the periods covered thereby.

 

Section 2.7           Absence
of Undisclosed Liabilities. The Company does not have any liabilities or obligations, of any nature, whether accrued, absolute,
contingent, asserted, unasserted, known or unknown, or otherwise, except liabilities or obligations (a) reflected or reserved
against in the Base Balance Sheet, (b) current liabilities incurred in the ordinary course of business reflected on the Closing
Statement, or (c) set forth on Schedule 2.7.

 

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Section 2.8           Absence
of Certain Developments. Since January 1, 2015, the Company has conducted its business only in the ordinary course of business
and, except as set forth on Schedule 2.8, there has not been:

 

(a)          any
change or event, by itself or in conjunction with all other changes or events, that has had, or would reasonably be likely to have,
a material adverse effect on the assets, condition (financial or other), properties, business, operations or prospects of the Company;

 

(b)          any
Encumbrance placed on any of the properties of the Company, other than Encumbrances for Taxes not yet due and payable or for Taxes
being contested in good faith by appropriate proceedings for which adequate reserves have been made on the Financial Statements;

 

(c)          any
purchase, sale or other disposition, or any agreement or other arrangement for the purchase, sale or other disposition, of any
properties or assets by the Company, for at least $25,000 individually, and in each case outside of the ordinary course of business;

 

(d)          any
damage, destruction or loss of property, of at least $25,000 in value, whether or not covered by insurance;

 

(e)          any
declaration, setting aside or payment of any dividend or other distribution by the Company in respect of the Equity Interests of
the Company, or any direct or indirect redemption, purchase or other acquisition by the Company of Equity Interests;

 

(f)           except
in the ordinary course of business, (i) any hiring, resignation, termination or removal of any officer or employee of the Company,
or (ii) any increase in the compensation of any employee of the Company or any promise or agreement to change the compensation
of any employee of the Company;

 

(g)          any
establishment, adoption, amendment or termination of any Employee Benefit Program;

 

(h)          any
issuance, sale or grant, or contract to issue, sell or grant any Equity Interests of the Company or any options, warrants or other
rights with respect to the Equity Interests of the Company;

 

(i)           any
payment or discharge of a material Encumbrance or material liability of the Company, other than the payment or discharge of any
Encumbrance or liability in the ordinary course of business;

 

(j)           any
change to any Tax election or any method of accounting for Tax purposes, or any action in respect of Taxes (other than the payment
of Taxes when due in the ordinary course) or with any Governmental Authority;

 

(k)          any
contingent liability incurred by the Company as guarantor with respect to the obligations of others or any cancellation of any
Indebtedness or claim owing to, or waiver of any right of, the Company;

 

(l)           any
obligation or liability incurred by the Company to any of its officers, directors, managers, Equity Interests holders, or any loans
or advances made by the Company to any of its officers, directors, managers, Equity Interest holders or employees other than compensation
and benefits payable to employees in the ordinary course of business;

 

(m)         any
material change in accounting methods or practices of the Company;

 

    	 	7	 

     

    

 

(n)         any
material loss or material reduction, or, to the Knowledge of the Company, development that could result in a material loss or material
reduction, of business with any material supplier or customer of the Company;

 

(o)         any
termination of any agreement that would have met the definition of Material Contracts;

 

(p)         any
arrangements relating to any royalty, commission or similar payment based on the revenues, profits, sales volume, production or
collections of the Company in each case in excess of $10,000 individually or in the aggregate;

 

(q)         any
regulatory action, or other proceeding commenced, or threatened in writing by any Governmental Authority against the Company; or

 

(r)          any
agreement for the Company to take any of the actions specified in paragraphs (a) through (q) above.

 

Section 2.9           Accounts
Receivable; Accounts Payable. 

 

(a)          All
accounts receivable of the Company represent transactions concluded for good and valuable consideration resulting from bona fide
arm’s length transactions in the ordinary course of business for the sale of products or performance of services to third
parties, are collectible, and will be collected in full, net of reserves shown on the Closing Statement, in accordance with their
terms, are valid and enforceable claims, are properly categorized as accounts receivable under GAAP and are not subject to any
rights of set off or counterclaims. Since January 1, 2015, the Company has collected its accounts receivable, including pre-paid
accounts and customer deposits, in the ordinary course of its business and in a manner which is consistent with past practices
and has not materially changed its collection policies with respect to its accounts receivable or accelerated any such collections,
including the collection of any pre-paid accounts or customer deposits.

 

(b)          All
accounts payable and other payables of the Company arose in bona fide arm’s length transactions in the ordinary course of
business and no such account payable or other payable is delinquent in its payment per its terms. All lease payments, utilities,
Taxes, payroll or other payables owed by Company that were due in accordance with their terms on a date on or before the Closing
Date have been paid in full prior to Closing. Since January 1, 2015, the Company has paid its accounts payable and other payables
in accordance with their terms and has not delayed any such payments.

 

Section 2.10         Transactions
with Affiliates. Except as set forth on Schedule 2.10, there are no Contractual Obligations, loans or other transactions
between the Company, on the one hand, and any of its Affiliates, present or former Equity Interest holders, directors, managers,
officers or employees, or to the Knowledge of the Company, any Affiliate of any of such Persons, on the other hand. No Affiliate
of the Company, nor any of the Company’s current Equity Interest holders, directors, managers, officers or employees, nor
any Affiliate of any such Person, owns directly or indirectly, on an individual or joint basis, any interest in, or serves as
an officer or director or in another similar capacity of, any competitor, customer or supplier of the Company, or any organization
which has a material contract or arrangement with the Company.

 

Section 2.11         Title
to and Encumbrances on Properties.

 

(a)          Schedule
2.11(a) sets forth a list of all real property leased by the Company and the name of the tenant and landlord and the street
address for each such property (the “Leased Real Properties”). Except as set forth in Schedule 2.11(a),
no portion of any Leased Real Property is subleased to or occupied by a third party. All leases relating to the Leased Real Property
are identified on Schedule 2.11(a). The Company has valid and enforceable leasehold interests to the leasehold estate in
the Leased Real Property and enjoys peaceful and undisturbed possession of the Leased Real Property. The occupation of and operation
of the Company’s business at each Leased Real Property is a permitted use under the lease of such Leased Real Property and
all applicable Laws, including local zoning ordinances. The Company does not own, and has never owned, any real property.

 

    	 	8	 

     

    

 

(b)          The
Company has good and (if applicable) transferable title or leasehold interest (if applicable) to all of its assets, free and clear
of any Encumbrances, except for the Encumbrances set forth on Schedule 2.11(b). No financing statement under the Uniform
Commercial Code with respect to any of the assets of the Company is active in any jurisdiction, except as set forth on Schedule 2.11(b).
All material tangible assets are in working order (reasonable wear and tear excepted), have been maintained in a manner consistent
with the needs of the Company’s business and conform in all material respects with all Laws. All leases of personal property
to which the Company is a party are fully effective and afford the Company peaceful and undisturbed possession and use of the subject
matter to the lease. The assets owned and leased by the Company are sufficient for the conduct of the business of the Company as
presently conducted.

 

Section 2.12         Tax
Matters.

 

(a)          The
Company has timely and properly filed or caused to be filed all federal, state and local Tax Returns required to be filed by it
through the date hereof with respect to any Taxes, and all such Tax Returns are true, correct and complete in all material respects.
The Company has paid or caused to be paid all Taxes required to be paid by it through the date hereof, whether or not shown on
any Tax Return, and has made adequate provision for Taxes that are not yet due and payable, for all taxable periods, or portions
thereof, ending on or before the date hereof on the appropriate books and records. The Company has delivered to the Buyer prior
to Closing true, correct and complete copies of all Tax Returns for which the applicable statutory periods of limitations have
not yet expired. 

 

(b)          No
U.S. federal, state or local audits or other administrative proceedings or other court proceedings are pending with regard to any
Taxes or Tax Returns of the Company. The Company has not received notice of any Tax audit or of any proposed Tax deficiencies from
any Governmental Authority. No Governmental Authority is now asserting, or, to the Knowledge of the Company, threatening to assert,
against the Company any deficiency or claim for additional Taxes. All deficiencies for Taxes asserted or assessed against the Company
have been paid in full or finally settled. The Company has not received notice from a Governmental Authority in a jurisdiction
where the Company does not file Tax Returns to the effect that the Company is or may be subject to taxation or Tax reporting requirements
by that jurisdiction. The Company has not waived any statute of limitations in respect of Taxes or agreed to any extension of time
with respect to a Tax assessment or deficiency which extension is currently effective.

 

(c)          The
Company has withheld and timely paid all Taxes required to have been withheld and paid in connection with any amounts paid or owing
to any employee, independent contractor, creditor, Equity Interest holder, or other third party. The Company has collected, remitted
and reported to the appropriate Governmental Authority all sales Taxes required to be so collected, remitted or reported pursuant
to all Laws. The Company has complied in all material respects with all Laws relating to record retention (including, without limitation,
to the extent necessary to claim any exemption from sales Tax collection, maintaining adequate and current resale certificates
to support any such claimed exemption, and with respect to payroll and other Tax withholding matters).

 

(d)          The
Company is not a party to any agreement or arrangement requiring indemnification, sharing or allocation of Taxes.

 

(e)          The
Company has never been a member of an affiliated group of corporations filing a combined federal income Tax return and the Company
does not have any liability for Taxes of any Person under Treasury Regulation 1.1502-6 (or any similar provision of state, local,
or foreign law), as a transferee or successor, by contract, or otherwise.

 

(f)          Neither
TVV nor the Company is a foreign person within the meaning of Section 1445 of the Code and Treasury Regulations Section 1.1445-2,
and the Company is and has always been a “United States person” within the meaning of Section 7701(a)(30) of the Code.

 

    	 	9	 

     

    

 

(g)          There
are no Encumbrances for Taxes upon the assets of the Company, except for Encumbrances relating to current Taxes not yet due or
for Taxes being contested in good faith by appropriate proceedings for which adequate reserves have been made on the appropriate
books and records.

 

(h)          The
Company has not entered into, or otherwise participated (directly or indirectly) in any “listed transaction” within
the meaning of Treasury Regulations Section 1.6011-4(b)(2) or any other “reportable transaction” within the meaning
of Treasury Regulations Section 1.6011-4(b).

 

(i)          The
Company will not be required to include any item of income in, or exclude any deduction from, taxable income for any taxable period
(or portion thereof) ending after the Closing Date as a result of any (i) change in method of accounting for a taxable period ending
on or before the Closing Date, (ii) “closing agreement” as described in Section 7121 of the Code (or any corresponding
or similar provision of state, local or foreign income Tax law) executed on or before the Closing Date, (iii) installment sale
or open transaction disposition made on or before the Closing Date, or (iv) prepaid amount received on or before the Closing Date.

 

(j)          The
Company has never engaged in trade or business activity outside the United States and the Company is not subject to Tax in any
non-U.S. jurisdiction.

 

Section 2.13         Certain
Contractual Obligations.

 

(a)          Schedule
2.13(a) contains a list of all Contractual Obligations to which the Company is a party:

 

(i)          involving
an aggregate commitment or payment of Twenty Thousand Dollars ($20,000) or more by the Company to any other Person or by any other
Person to the Company;

 

(ii)         having
a term in excess of twelve (12) months and is not cancelable without penalty by the Company upon ninety (90) days or less prior
notice;

 

(iii)        containing
covenants limiting in any respect the freedom of the Company to compete in any line of business or with any Person, including,
without limitation, any non-solicitation covenants;

 

(iv)        with
any employee, officer, director, manager or Equity Interest holder of the Company or, to the Knowledge of the Company, any of their
respective Affiliates;

 

(v)         relating
to the licensing, distribution, development, purchase, sale, use or servicing of the Intellectual Property of the Company;

 

(vi)        related
to redemption or purchase agreements or other agreements affecting or relating to the Equity Interests of the Company;

 

(vii)       with
respect to any Indebtedness;

 

(viii)      with
respect to any agreement involving fixed price or fixed volume arrangements;

 

(ix)         with
respect to any agreement that involves a sharing of revenues, profits, losses, costs or liabilities by the Company with any other
Person or any royalty, dividend or similar arrangement based on the revenue or profits of the Company;

 

(x)          with
respect to any acquisition, merger or similar arrangement; or

 

(xi)         with
respect to any Leased Real Property.

 

    	 	10	 

     

    

 

(b)          Each
of the Contractual Obligations of the Company set forth on Schedule 2.13(a) or any of the other schedules hereto (collectively,
the “Material Contracts”) is in full force and effect, is the legal, valid and binding obligation of the Company
and, to the Company’s Knowledge, each of the other counterparties thereto, and is enforceable against each of them in accordance
with its terms, except as such enforceability may be limited by General Enforceability Exceptions, and, subject to obtaining any
authorizations, waivers, consents and permits (all of which are disclosed on Schedule 2.3), will continue to be so enforceable
and in full force and effect on identical terms following the consummation of the transactions contemplated hereby in accordance
with its terms. Except as set forth on Schedule 2.13(b), neither the Company nor, to the Company’s Knowledge,
any of the counterparties thereto has committed any breach or violation of or default under, or has repudiated any provisions of
any Material Contract nor has any event occurred that (with or without notice, lapse of time or both) would constitute a breach
or violation of or default under any Material Contract. The Company has heretofore delivered to the Buyer accurate and complete
copies of each of the Material Contracts and, in each case, all amendments, modifications and supplements thereto and waivers thereunder.
The Company has delivered an accurate description of all material terms of each oral Material Contract and, in each case, all amendments
and to the Company’s Knowledge supplements thereto and waivers thereunder.

 

Section 2.14         Intellectual
Property. Schedule 2.14 contains a complete and accurate list of all Intellectual Property which is owned by, licensed
by or used by the Company and all agreements of the Company to license or use the Intellectual Property used by the Company, other
than generally available commercial, unmodified, “off the shelf” software licenses of Intellectual Property with a
purchase price of less than $5,000. There are no pending or, to the Knowledge of the Company, threatened proceedings asserting
that the use of the licensed Intellectual Property by the Company infringes upon or misappropriates any Intellectual Property
rights of any Person, except as set forth on Schedule 2.14. The Company has not received any written notice or allegation
of invalidity, infringement, or misappropriation from any Person or Governmental Authority with respect to any Intellectual Property
rights, except as set forth on Schedule 2.14. The Company’s business, as currently conducted does not infringe the
Intellectual Property rights of a third party, except as set forth on Schedule 2.14. Each of the past and current
employees, officers, directors, managers, independent contractors or other service providers of the Company has executed a valid
and enforceable confidentiality and assignment of inventions agreement with respect to all Intellectual Property of the Company,
except as set forth on Schedule 2.14.

 

Section 2.15         Litigation.
Except as set forth on Schedule 2.15, since January 1, 2012, there has been no arbitration, litigation, product liability,
warranty, malpractice or any other claim or governmental or administrative proceeding or investigation pending or, to the Knowledge
of the Company, threatened in writing by or against the Company, or affecting the properties or assets of the Company, or, as
to matters related to the Company, by or against any officer, director, manager, Equity Interest holder or employee of the Company
in their respective capacities in such positions, nor, to the Knowledge of the Company, has there occurred any event nor does
there exist any condition on the basis of which any such claim may be asserted.

 

Section 2.16         Employee
and Labor Matters. Schedule 2.16 sets forth: (a) the name, title, current hourly rate or annual salary, full-time/part-time
status, exempt/non-exempt status, bonus for the year ending December 31, 2015, and aggregate annual compensation for each current
employee of the Company. The Company is not delinquent in payments to any of its employees or independent contractors for any
wages, salaries, commissions, bonuses or other direct compensation for any services performed as of the date hereof or any reimbursable
amounts. The Company is and heretofore has been in compliance with all Laws respecting labor, employment, fair employment practices,
terms and conditions of employment, occupational safety and health, and wages and hours. There has been no “mass layoff”
or “plant closing” within the meaning of the Worker Adjustment and Retraining Notification Act of 1988, as amended
(“WARN”), and any similar state or local “mass layoff” or “plant closing” Law with
respect to the Company within three (3) years prior to Closing. The Company is not a party to or otherwise bound by any collective
bargaining agreement or other Contractual Obligation with a labor union or labor organization. The Company is not subject to any
charge, demand, petition or representation proceeding seeking to compel, require or demand it to bargain with any labor union
or labor organization nor, as of the date of this Agreement, is there pending or, to the Knowledge of the Company, threatened
any labor strike, dispute, walkout, work stoppage, slow-down or lockout involving the Company. With respect to the Company’s
employment and labor practices and policies, (x) there is no investigation, audit or review pending of which the Company
has been notified in writing (or, to the Knowledge of the Company, threatened) by any Governmental Authority, and (y) there are
no Orders before any Governmental Authority to which the Company is a named party. The Company is not sponsoring any employee
to work in the United States or any other country under a visa or work authorization, and no petition for admission of any alien
under a non-immigrant or other visa, or for transfer of sponsorship of any such employee, is currently pending. Each employee
of the Company is authorized to work in the United States. The Company has current Forms I-9 for all employees of the Company
who work in the United States, and has complied with required processes with respect to obtaining such Forms I-9.

 

    	 	11	 

     

    

 

Section 2.17         Company
Licenses; Compliance with Laws. The Company holds, and has held at all times since January 1, 2010, all licenses, permits,
approvals, authorizations, registrations and certifications of any Governmental Authority that are required in order to permit
the Company to own or lease its properties and assets and to conduct its business under and pursuant to all Laws. Schedule
2.17 sets forth a complete and correct list of all licenses, permits, approvals, authorizations, registrations and certifications
currently in effect for the Company (the “Company Licenses”). Each Company License is valid and in full force
and effect. There is no investigation or proceeding pending or, to the Knowledge of the Company, threatened in writing that could
result in the termination, revocation, suspension, modification or restriction of any Company License or the imposition of any
fine, penalty or other sanctions for violation of any requirements relating to any Company License. Except as set forth in Schedule 2.17,
none of the Company Licenses will be affected in any respect by the consummation of the transactions contemplated hereby. Neither
the Company nor, to the Company’s Knowledge, any employee of the Company, has ever entered into or been subject to any Order
with respect to any aspect of the business, affairs, properties or assets of the Company or received any request for information,
notice, demand letter, administrative inquiry or formal complaint or claim from any regulatory agency or other Governmental Authority
with respect to any aspect of the business, affairs, properties or assets of the Company.

 

Section 2.18         Employee
Benefits.

 

(a)          Schedule
2.18 lists every Employee Benefit Program maintained at any time, or with respect to which the Company, or any of its ERISA
Affiliates, had any liability with respect to, during the past five (5) years. Each such Employee Benefit Program has been maintained
and administered in compliance with its terms and with the requirements and provisions of the Employee Retirement Income Security
Act of 1974, as amended (“ERISA”), the Code and other Law.

 

(b)          Each
Employee Benefit Program that is intended to be qualified under Section 401(a) of the Code has received a favorable determination
or opinion letter from the Internal Revenue Service regarding its qualified status and no event or omission has occurred which
would adversely impact such qualified status. Neither the Company nor any of its ERISA Affiliates has ever maintained, sponsored
or contributed to any employee benefit plan which is subject to Title IV of ERISA or the minimum funding requirements of Section
412 of the Code. Neither the Company nor any of its ERISA Affiliates has ever contributed to, been obligated to contribute to or
has any potential liability to any “multi-employer plan” as defined in Section 3(37) of ERISA or “multiple-employer
plan” as defined in Section 413(c) of the Code or a multiple employer welfare arrangement as defined in section 3(40)(A)
of ERISA. The consummation of the transactions contemplated by this Agreement will not cause the Buyer to incur any liability under
any of the Employee Benefit Programs, other than those arising in the ordinary course of business.

 

(c)          No
litigation or governmental administrative proceeding, audit or other proceeding (other than those relating to routine claims for
benefits) is pending or, to the Company’s Knowledge, threatened with respect to any Employee Benefit Program or any fiduciary
or service provider thereof, and, to the Company’s Knowledge, there is no reasonable basis for any such litigation or proceeding.

 

(d)          Neither
the execution and delivery of this Agreement, nor the consummation of the transactions contemplated hereby could (either alone
or in conjunction with any other event): (i) result in any “parachute payment” as defined in Section 280G(b)(2) of
the Code (whether or not such payment is considered to be reasonable compensation for services rendered), (ii) increase any benefits
otherwise payable by the Company; or (iii) result in the acceleration of the time of payment or vesting of any awards or benefits
or give rise to any additional service credits under any Employee Benefit Program.

 

    	 	12	 

     

    

 

(e)          Complete
copies of the following documents, with respect to each of the Employee Benefit Programs have been delivered to the Buyer by the
Company, to the extent applicable: (i) any plans, all amendments thereto and related trust documents, and amendments thereto; (ii)
the three (3) most recently filed Forms 5500 and all schedules and audited financial statements related thereto and the most recent
actuarial report, if any; (iii) the most recent IRS determination letter; (iv) the most recent summary plan descriptions; (v) written
communications to employees relating to such Employee Benefit Programs within the past twelve (12) months; and (vi) written
descriptions of all non-written agreements relating to the Employee Benefit Programs.

 

(f)          All
contributions (including all employer contributions and employee salary reduction contributions) required to have been made under
any of the Employee Benefit Programs or by Law (without regard to any waivers granted under Section 412 of the Code), to any funds
or trusts established thereunder or in connection therewith have been made, and all contributions for any period ending on or before
the Closing Date which are not yet due will have been paid or accrued as a liability in the calculation of Net Working Capital.

 

Section 2.19         Insurance
Coverage. The Company has since January 1, 2012 maintained in full force and effect general commercial, general liability,
workers’ compensation and employees’ liability, fire and casualty and such other appropriate insurance policies with
coverage as required either by Law or any Contractual Obligation of the Company. Schedule 2.19 contains an accurate
summary of the insurance policies or other arrangements currently maintained by the Company and all claims thereon (or prior policies
or arrangements) made since January 1, 2012. Except as set forth on Schedule 2.19, there are currently no claims that are
pending under any of the Company’s current or past insurance policies or other arrangements (other than medical claims made
by employees of the Company under health insurance policies maintained for employees by the Company) or against any director,
officer, or employee of the Company in their respective capacities in such positions, nor, to the Knowledge of the Company, has
there occurred any event nor does there exist any condition on the basis of which any such claim may be asserted, and all premiums
due and payable with respect to such policies have been paid to date. All such policies and arrangements are valid, binding and
enforceable and, to the Knowledge of the Company, there is no threatened termination of any such policies or arrangements. To
the Knowledge of the Company, no event has occurred and no condition exists on the basis of which the premiums or rates with respect
to such policies and arrangements may be increased (other than with respect to increases in the ordinary course). Since January
1, 2012 Company has not exhausted the coverage limits under any of its current or past insurance policies. Except as set forth
on Schedule 2.19, no insurance policy provides for any retrospective premium adjustment or other experience-based
liability on the part of the Company. There are no self-insurance arrangements affecting the Company. Attached to Schedule
2.19 is a loss run report for the past five (5) years for each of the insurance policies required to be set forth on Schedule 2.19.

 

Section
2.20         Investment Banking; Brokerage. Other than fees owed by the Company
as set forth on Schedule 2.20, there are no investment banking fees, brokerage commissions, broker’s or finder’s
fees or similar compensation due in connection with the transactions contemplated by this Agreement payable by the Company or
TVV and, to the Knowledge of the Company, there is no basis for any Person (other than Hilliard Lyons Investment Banking) to make
any claim for brokerage commissions, broker’s or finder’s fees or similar compensation in connection with the transactions
contemplated by this Agreement.

 

Section
2.21         Environmental Matters. Except as set forth on Schedule 2.21,
(a) no hazardous waste, substance or material, oil, petroleum, petroleum product, asbestos, toxic substance, pollutant or contaminant
(collectively, “Hazardous Material”), has been generated, transported, used, handled, processed, disposed,
stored or treated on any real property leased or operated by the Company, and (b) no Hazardous Material has been spilled,
released, discharged, disposed, or transported from any real property leased or operated by the Company, and no Hazardous Material
is present in, on, or under any such property. The Company is, and at all times has been, in compliance in all material respects
with all applicable environmental, health and safety Laws and with all permits, registrations and approvals required under such
Laws (collectively, “Environmental Laws”). To the Knowledge of the Company, there exists no fact or circumstance
that would involve the Company in any material litigation, or impose any material liability, arising under any Environmental Laws.

 

    	 	13	 

     

    

 

Section
2.22         Suppliers; Customers.

 

(a)          Within
the last twelve (12) months, no supplier or vendor (i) that the Company has paid or is under a Contractual Obligation to pay $20,000
or more or (ii) that is the sole supplier of any product or service to the Company, has canceled, materially modified, or
otherwise terminated its relationship with the Company, or materially decreased its services, supplies or materials to the Company,
nor, to the Knowledge of the Company, does any such supplier or vendor have any plan or intention to do any of the foregoing. Schedule
2.22 sets forth a list of the top ten (10) suppliers or vendors of the Company, measured by dollar volume, for each of the
years ending December 31, 2013, December 31, 2014, and December 31, 2015.

 

(b)          Except
as disclosed on Schedule 2.22, within the last twelve (12) months, no material customer has canceled, materially modified,
or otherwise terminated its relationship with the Company or materially decreased business with the Company, nor has any material
customer notified the Company that it intends to terminate or materially reduce or change the terms of its business with the Company,
nor, to the Knowledge of the Company, does any material customer have any plan or intention to do any of the foregoing. Schedule
2.22 sets forth a list of the top ten (10) customers of the Company, measured by dollar volume, for each of the years ending
December 31, 2013, December 31, 2014, and December 31, 2015.

 

Section 2.23         Indebtedness.
Except as set forth on Schedule 2.23, the Company does not have any Indebtedness, nor are any assets of the Company subject
to the Indebtedness of any other Person. For each item of Indebtedness, Schedule 2.23 correctly sets forth, if applicable,
the debtor, the principal amount of the Indebtedness as of the date of this Agreement, the creditor, the maturity date and the
collateral, if any, securing the Indebtedness.

 

Section
2.24         Illegal Payments. Neither
the Company nor, to the Knowledge of the Company, any Person affiliated with the Company has ever offered, made or received on
behalf of the Company any illegal payment or illegal contribution of any kind, directly or indirectly, including, without limitation,
payments, gifts or gratuities, to any United States or foreign national, state or local government officials, employees or agents
or candidates therefor or other Persons.

 

Section
2.25         Products. The Buyer has been furnished with accurate copies of
the standard terms and conditions of sale for each of the products or services of the Company (containing applicable
guaranty, warranty and indemnity provisions). Except as set forth on Schedule 2.25(a), no product manufactured,
sold or delivered by, or service rendered by or on behalf of, the Company is subject to any guaranty, warranty or other
indemnity, express or implied, beyond such standard terms and conditions.

 

(b)          The
Company has not entered into, or offered to enter into, any Contractual Obligation pursuant to which the Company or the Buyer (after
the Closing Date) is or shall be obligated to make any rebates, discounts, promotional allowances or similar payments or arrangements
with or to any customer or other business relation, except as set forth on Schedule 2.25(b).

 

Section 2.26         Full
Disclosure. No representation or warranty by the Company in this Agreement and no statement contained in the Schedules or
any certificate or other document furnished or to be furnished to the Buyer pursuant to this Agreement contains any untrue statement
of a material fact, or omits to state a material fact necessary to make the statements contained therein, in light of the circumstances
in which they were made, not misleading.

 

Article
III

REPRESENTATIONS AND WARRANTIES OF TVV

 

In order to induce
the Buyer to enter into this Agreement and the other Transaction Agreements, TVV makes each of the following representations and
warranties contained in this Article III to the Buyer.

 

Section 3.1           Stock;
Closing Date Payment. As described on Schedule 2.4, TVV holds beneficially and of record all of the issued and outstanding
Stock of the Company set forth opposite TVV’s name on Schedule 2.4 and has good and marketable title to such Stock,
free and clear of all Encumbrances, except for federal and state securities Law restrictions of general applicability. TVV has
full legal capacity, right, power and authority to transfer and deliver to the Buyer valid title to the Stock held by TVV, free
and clear of all Encumbrances, except for federal and state securities Law restrictions of general applicability. When delivered
by TVV to the Buyer pursuant to this Agreement, the Stock will be free and clear of any and all Encumbrances, except for federal
and state securities Law restrictions of general applicability.

 

    	 	14	 

     

    

 

Section 3.2           Authority.
TVV has full power, authority and legal capacity to execute and deliver this Agreement and the other Transaction Agreements to
which TVV is a party and to carry out the transactions contemplated hereby and thereby. This Agreement and the other Transaction
Agreements to which TVV is a party have been duly authorized, executed and delivered by TVV and assuming the due authorization,
execution and delivery of this Agreement and the other Transaction Agreement to which TVV is a party by each of the other parties
hereto and thereto, this Agreement and the other Transaction Documents to which TVV is a party constitutes the legal, valid and
binding obligation of TVV enforceable against TVV in accordance with their respective terms, subject only to General Enforceability
Exceptions.

 

Section
3.3           No Conflict; Consents. The execution, delivery and performance
by TVV of this Agreement and the other Transaction Agreements executed and delivered by or on behalf of TVV, and the performance
of the transactions contemplated by this Agreement and such other Transaction Agreements do not and will not: (a) violate or result
in a violation of, conflict with or constitute or result in violation of or a default (whether after the giving of notice, lapse
of time or both) or loss of benefit under or granted by, any provision of any Law, or any restriction imposed by Governmental
Authority, or any governing document, in each case applicable to TVV; (b) except as set forth on Schedule 3.3, require
TVV to provide any notice to, make any declaration or filing with, or obtain the consent or approval of, any Governmental Authority
or other Person; or (c) violate or result in a violation of or constitute a default (whether after the giving of notice, lapse
of time or both) under, give rise to or accelerate any obligation under, or give rise to a right of termination of or result in
a loss of benefit under any material indenture or loan or credit agreement or any other material agreement, contract, instrument,
mortgage, lien, lease, permit, license, authorization, order, writ, judgment, injunction, decree, determination or arbitration
award to which TVV is a party or by which any of TVV’s assets (including the Stock held by TVV) are bound, or result in
the creation or imposition of any Encumbrance on any of the Buyer’s assets (including the Stock transferred hereunder).

 

Section
3.4           Brokers. Other than as set forth on Schedule 2.20,
no broker, finder or investment banker is entitled to any brokerage, finder’s or other fee or commission from TVV in connection
with the transactions contemplated by this Agreement.

 

Section
3.5           Litigation. There is no suit, claim, action, proceeding
or investigation pending or, to the Knowledge of TVV, threatened against TVV affecting or relating to the Stock or which could
reasonably adversely affect the ability of such Stockholder to consummate the transactions contemplated by this Agreement or any
of Transaction Agreements to which TVV is a party, and TVV is not subject to any outstanding Order of any Governmental Authority.

 

Article
IV

REPRESENTATIONS AND WARRANTIES OF THE BUYER 

 

In order to induce
the Company and TVV to enter into this Agreement and the other Transaction Agreements, the Buyer makes each of the following representations
and warranties contained in this Article IV to the Company and TVV.

 

Section 4.1           Organization
and Power. The Buyer is a corporation duly organized, validly existing and in good standing under the Laws of the State of
Nevada. The Buyer has full power and authority to own or lease its properties and to conduct its business in the manner and in
the places where such properties are owned or leased or such business is conducted by it. The Buyer has all required power and
authority to carry on its business as presently conducted, to enter into and perform this Agreement and the other Transaction
Agreements to which it is a party and to carry out the transactions contemplated hereby and thereby. A copy of the Organizational
Documents of the Buyer has been furnished to the Company by the Buyer and is correct and complete in all respects and no amendments
thereto are pending.

 

Section
4.2           Authorization. The Buyer has full right, authority, power
and legal capacity to enter into this Agreement and the other Transaction Agreements executed and delivered by or on behalf of
the Buyer and to carry out the transactions contemplated hereby and thereby. The execution, delivery and performance of this Agreement
and the other Transaction Agreements to which the Buyer is a party have been duly authorized by all necessary action of the board
of directors of Buyer. This Agreement and the other Transaction Agreements executed and delivered by or on behalf of the Buyer
have been duly executed and delivered by the Buyer and, assuming due authorization, execution and delivery of this Agreement and
the other Transaction Agreements to which the Buyer is a party by the other parties hereto and thereto, this Agreement and such
other Transaction Agreements to which the Buyer is a party constitute legal, valid and binding obligations of the Buyer, enforceable
in accordance with their respective terms, subject only to General Enforceability Exceptions.

 

    	 	15	 

     

    

 

Section
4.3           Non-Contravention.
The execution, delivery and performance by the Buyer of this Agreement and the other Transaction Agreements executed and delivered
by or on behalf of the Buyer, and the performance of the transactions contemplated by this Agreement and such other Transaction
Agreements do not and will not: (a) violate or result in a violation of, conflict with or constitute or result in violation of
or a default (whether after the giving of notice, lapse of time or both) under the Buyer’s organizational documents; (b)
in any material respect, violate or result in a violation of, conflict with or constitute or result in violation of or a default
(whether after the giving of notice, lapse of time or both) or loss of benefit under or granted by, any provision of any Law,
or any restriction imposed by Governmental Authority applicable to the Buyer; (c) require the Buyer to provide any notice to,
make any declaration or filing with, or obtain the consent or approval of, any Governmental Authority or other Person; or (d)
violate or result in a violation of or constitute a default (whether after the giving of notice, lapse of time or both) under,
give rise to or accelerate any obligation under, or give rise to a right of termination of or result in a loss of benefit under
any material indenture or loan or credit agreement or any other material agreement, contract, instrument, mortgage, lien, lease,
permit, license, authorization, order, writ, judgment, injunction, decree, determination or arbitration award to which the Buyer
is a party or by which any of the Buyer’s assets are bound or affected, or result in the creation or imposition of any Encumbrance
on any of the Buyer’s assets.

 

Section
4.4           Brokers. No broker, finder or investment banker is entitled
to any brokerage, finder’s or other fee or commission from the Buyer in connection with the transactions contemplated by
this Agreement.

 

Section
4.5           Litigation. There is no suit, claim, action, proceeding
or investigation pending or, to the Knowledge of the Buyer, threatened against the Buyer and the Buyer is not subject to any outstanding
Order of any Governmental Authority that, in either case, would be reasonably likely, individually or in the aggregate, to prevent
or materially delay performance by the Buyer of any of its material obligations under this Agreement.

 

Section
4.6           Hennis Stock Redemption. Buyer acknowledges that it has
Knowledge of the Company’s purchase and redemption of 10,000 shares of Common Stock from Hennis and that the Company is
obligated under the Hennis Redemption Note.

 

Article
V

ADDITIONAL AGREEMENTS

 

Section 5.1           Press
Releases. Upon the Closing, the parties hereto shall release a joint press release mutually agreed upon by the Buyer and TVV.
None of the parties hereto shall, and each party hereto shall cause its Affiliates and Representatives not to, issue any other
press release relating to this Agreement or any of the other Transaction Agreements or any of the transactions contemplated hereby
or thereby without the prior written consent of the Company.

 

Section 5.2           Tax
Matters.

 

(a)          Preparation
and Filing of Tax Returns.

 

(i)          TVV
shall prepare and file, or shall cause to be prepared and filed, all Tax Returns of the Company for all periods ending on or before
the Closing Date. TVV shall pay or cause to be paid any Taxes due in respect of such Tax Returns. If any such Tax Return must be
signed by the Buyer, any Affiliate thereof, or the Company following the Closing Date, the Buyer agrees that it will (or will cause
such other parties to) reasonably cooperate in signing such Tax Return in order to permit the timely filing of such Tax Return.
TVV shall provide, or cause to be provided, to the Buyer a draft of any such Tax Return at least thirty (30) days prior to the
due date, giving effect to extensions thereto, for filing such Tax Return, for review by the Buyer. The Buyer shall notify TVV
of any reasonable objections the Buyer may have to any items set forth in such draft Tax Return and the Buyer and TVV agree to
consult and resolve in good faith any such objection. If the parties cannot resolve any such objections, the item in question shall
be resolved by the Accounting Referee. The fees and expenses of the Accounting Referee shall be borne one-half (1/2) by TVV, and
one-half (1/2) by the Buyer. Such Tax Returns shall be prepared in a manner consistent with past practices except as required by
changes in Law or as required by a provision of this Section 5.2.

 

    	 	16	 

     

    

 

(ii)         The
Buyer shall prepare and file, or cause to be timely prepared and filed, all Tax Returns of the Company, for Straddle Periods. Such
Tax Returns (“Straddle Returns”) shall be prepared consistently with past practice to the extent permitted by
Law. The Buyer shall provide, or cause to be provided, to TVV a draft of any Straddle Return at least thirty (30) days prior to
the due date, giving effect to extensions thereto for filing such Tax Return, for review by TVV. TVV shall notify the Buyer of
any reasonable objections TVV may have to any items set forth in such draft Straddle Return and the Buyer and TVV agree to consult
and resolve in good faith any such objection. If the parties cannot resolve any such objections, the item in question shall be
resolved by the Accounting Referee. The fees and expenses of the Accounting Referee shall be borne one-half (1/2) by TVV, and one-half
(1/2) by the Buyer. The Buyer shall notify TVV of any amounts due from TVV in respect of any Straddle Return no later than ten
(10) Business Days prior to the date on which such Straddle Return is due, and no later than five (5) Business Days prior to the
date on which such Straddle Return is due, TVV shall pay the Buyer the amount of Taxes for which it is responsible.

 

(b)          Straddle
Periods. For purposes of this Agreement, in the case of any taxable year or period that begins before and ends after the Closing
Date (a “Straddle Period”), (i) the amount of any Property Taxes of the Company for a Straddle Period allocable
to the Pre-Closing Period shall be equal to the amount of such Tax for the entire Straddle Period multiplied by a fraction the
numerator of which is the number of days in the taxable period ending on the Closing Date and the denominator of which is the number
of days in such Straddle Period, (ii) the amount of any Taxes other than Property Taxes of the Company allocable to the Pre-Closing
Period shall be computed as if such taxable year or period (and the taxable year or period of any entity taxable as a partnership
in which the Company owns a direct or indirect interest) ended as of the close of business on the Closing Date, and (iii) TVV
will receive the benefit of all tax deposits which have been made prior to the Closing Date, and the Straddle Return will properly
allocate all pertinent income and expenses that were incurred up to the Closing Date.

 

(c)          Tax
Sharing Agreements. The Company shall cause the provisions of any Tax sharing agreement involving the Company to be terminated
on or before the Closing Date. After the Closing Date, no party shall have any rights or obligations under such Tax sharing agreement.

 

(d)          Cooperation
on Tax Matters. After the Closing, the Buyer and TVV shall promptly make available or cause to be made available to the other,
as reasonably requested (at the expense of the requesting party), all information, records or documents relating to Tax liabilities
and potential Tax liabilities relating to the Company for all Pre-Closing Periods and shall preserve all such information, records
and documents until the expiration of any applicable statute of limitations or extensions thereof.

 

(e)          Transfer
Taxes. TVV shall pay all amounts owed for any sales, transfer, value added, excise, stock transfer, stamp, recording, registration
and any similar Taxes incurred under the laws of the United States of America or any state or local taxing authority thereof (“Transfer
Taxes”) that become payable in connection with the Stock Purchase and the other transactions contemplated hereby. The
Buyer shall (i) file all necessary documentation and Tax Returns with respect to any sales, transfer and similar Taxes, and (ii)
provide copies of such documentation and Tax Returns to TVV. The applicable parties shall cooperate in filing such forms and documents
as may be necessary to permit any such Transfer Tax to be assessed and paid and to obtain any exemption or refund of any such Transfer
Tax.

 

(f)          Tax
Contests. TVV shall have the right, at its own expense, to control and settle the portion of any audit, examination, or other
administrative or judicial proceeding, contest, assessment, notice of deficiency, or other adjustment or proposed adjustment relating
to any and all Taxes (a “Tax Contest”) for which TVV may have to indemnify a Buyer Indemnified Party, provided,
that the Buyer shall have the right to participate at its own expense in any Tax Contest that could have the effect of increasing
a Tax liability of the Buyer, and neither the Company nor TVV shall settle or compromise any Tax Contest without the Buyer’s
prior written consent if such settlement or compromise could have the effect of increasing a Tax liability of the Buyer or the
Company.

 

    	 	17	 

     

    

 

(g)          Interaction
with Article VI. Notwithstanding any provision herein to the contrary, to the extent that a provision of this Section 5.2
conflicts with a provision of Article VI, this Section 5.2 shall govern.

 

Section 5.3           Books
and Records. From and after the Closing, the Buyer shall, and shall cause the Company to, until the seventh (7th) anniversary
of the Closing Date or such longer period as required by state, federal or local law, retain all books, records and other documents
pertaining to the business of the Company in existence on the Closing Date and to make the same available for inspection by TVV
(at its expense) at reasonable times upon reasonable request and upon reasonable notice.

 

Section 5.4           Further
Action. Each of the parties hereto shall use its respective commercially reasonable efforts to take or cause to be taken all
appropriate action, do or cause to be done all things necessary, proper or advisable and execute and deliver such documents and
other papers, as may be required to carry out the provisions of this Agreement and the other Transaction Agreements and consummate
and make effective the transactions contemplated by hereby and thereby.

 

Section 5.5           Non-Disclosure,
Non-Competition and Non-Solicitation.

 

(a)          TVV
hereby covenants and agrees that from and after the Closing it will not, directly or indirectly, and shall cause its Affiliates
not to:

 

(i)          disclose
or furnish to any Person, other than the Buyer any Confidential Information; provided, however, that this covenant of non-disclosure
shall not apply to information (A) which is, or at any time becomes available in the public domain (other than as a result of disclosure
by TVV or any Affiliate of TVV), (B) which is required to be disclosed by Law or court or administrative court order (provided
that the Buyer receives notice of such required disclosure and a reasonable opportunity to take steps to maintain the confidentiality
thereof), and (C) which the Buyer expressly authorizes, in writing, TVV to disclose prior to such disclosure; and

 

(ii)         until
the fifth (5th) anniversary of the Closing Date, anywhere in the United States own, manage, operate, control, invest or participate
in or be connected with in any capacity (either as an employee, employer, trustee, consultant, agent, principal, partner, corporate
officer, director, manager, owner or shareholder or in any other individual or representative capacity) with any business, individual,
partnership, firm, corporation or other Person (other than the Buyer) which is engaged in the business of the manufacture, production
and direct sale of industrial mixers via catalog and the internet, with average total sale invoices (for an individual sale) of
approximately $1,000.00. Without implied limitation, the foregoing covenant shall prohibit: (A) hiring or engaging or attempting
to hire or engage for or on behalf of TVV or any other Person, any officer or employee of the Buyer or any of its Affiliates (including
officers or employees of the Company), or any former officer or employee of the Buyer or any of its Affiliates (including any former
officer or employee of the Company) who was employed or retained during the twelve (12) month period immediately preceding the
date of solicitation for or on behalf of TVV or any other Person, or soliciting or attempting to solicit any such officer or employee
or any independent contractor of Buyer or its Affiliates (including independent contractors of the Company) to terminate his or
her relationship or employment with the Buyer or any of its Affiliates (including the Company), or (B) soliciting for or on behalf
of TVV or any other Person, any client or customer of the Company as of the Closing Date or during the preceding twelve (12) months,
or diverting to any Person any client, customer or business opportunity of the Company. Notwithstanding the foregoing, Buyer acknowledges
that TVV and certain of its Affiliates are private equity funds engaged in seeking to invest in, and investing in, a diverse range
of manufacturing and industrial enterprises, some of which may overlap with some of the Company’s business operations, and
Buyer acknowledges that such investment activities are not prohibited by this subsection (ii), provided that
a principal portion of the business of any such manufacturing and industrial enterprise is not the manufacture, production and
direct sale of industrial mixers via catalog and the internet, with average total sale invoices (for an individual sale) of approximately
$1,000.00.

 

    	 	18	 

     

    

 

(b)          TVV
hereby agrees that the covenants contained in this Section 5.5 (the “Restrictive Covenants”) are entered
into in partial consideration of the Purchase Price, are reasonable in geographic scope and duration in view of the relevant market
for the products and services of the Company and that any breach of any of the Restrictive Covenants could result in continuing
and irreparable harm to the Buyer or its Affiliates (including the Company). Therefore, TVV hereby agrees and consents that, in
addition to any other remedies available to the Buyer or its Affiliates (including the Company) (whether at law or at equity),
the Buyer or its Affiliates (including the Company) shall be entitled to seek an injunction, restraining order or any appropriate
decree of specific performance for any actual or threatened violation or breach of this Section 5.5 by TVV or TVV’s
Affiliates, without the posting of any bond.

 

(c)          Each
of the Restrictive Covenants is distinct and severable, notwithstanding that some of such covenants may be set forth in one section
hereof for convenience.

 

(d)          In
the event that any or all of the Restrictive Covenants shall be determined by a court of competent jurisdiction to be unenforceable
by reason of their geographic or temporal restrictions being too great, or by reason that the range of activities covered are too
great, or for any other reason, they should be interpreted to extend over the maximum geographic area, period of time, range of
activities, or other restrictions as to which they may be enforceable.

 

Section 5.6           General
Waiver and Release. TVV, on behalf of its Affiliates, Representatives, successors, and assigns and any other Person claiming
by, through or under any of the foregoing (collectively, the “Stockholder Releasing Parties”), does hereby
unconditionally and irrevocably release, waive and forever discharge the Buyer, the Company, each of their respective predecessors
and successors and each of their respective past, present and future Representatives, Subsidiaries and Affiliates (and any Affiliates
of any of the foregoing) from any and all claims, demands, judgments, causes of action and liabilities of any nature whatsoever,
whether or not known, suspected or claimed, arising directly or indirectly from any act, omission, event or transaction occurring
on or prior to the Closing Date, which, for the avoidance of doubt, includes (without limitation) any and all claims of breach
and causes of action based on alleged breach and associated liabilities arising out of or relating to any commercial arrangement
or agreement between TVV and the Company or any of the Stockholder Releasing Parties entered into prior to the Closing, but excludes
(subject to Section 6.5) any of TVV’s rights expressly set forth in
this Agreement, or any other Transaction Agreement to which TVV is a party. WITHOUT LIMITING THE FOREGOING, TVV EXPRESSLY WAIVES
AND RELINQUISHES ALL RIGHTS AND BENEFITS AFFORDED BY ANY APPLICABLE Law that limits in
any manner the release set forth herein. TVV ACKNOWLEDGES THAT IT HAS CAREFULLY READ THE FOREGOING WAIVER AND GENERAL RELEASE
AND UNDERSTANDS ITS CONTENTS. TVV represents and warrants that (x) there are no liens, or claims of lien, or assignments in law
or equity or otherwise of or against any of the claims or causes of action released herein, (y) TVV has not transferred or otherwise
alienated any such claims or causes of action, and (z) TVV is fully authorized and entitled to give the releases specified herein.

 

Article
VI

SURVIVAL; INDEMNIFICATION

 

Section 6.1           Survival
of Representations, Warranties and Covenants. All representations, warranties, agreements and covenants of the parties made
herein and in the Schedules hereto shall be deemed to have been relied upon by the party or parties to whom they are made in entering
into this Agreement and shall survive the Closing. Notwithstanding the foregoing, all representations and warranties set forth
in Articles II, III and IV shall survive the Closing until the Expiration Date; provided, however,
that the Expiration Date shall not apply to any (a) representations and warranties set forth in Section 2.12 (Tax Matters)
or Section 2.21 (Environmental Matters), and in each such case the representations and warranties set forth therein shall
survive until the second anniversary of the Closing Date, and (b) any representations and warranties contained in Section 2.1
(Organization and Power), Section 2.2 (Authorization), Section 2.4 (Capitalization), Section 2.11
(Title to and Encumbrance on Properties), Section 2.20 (Investment Banking; Brokerage), Section 3.1 (Stock;
Closing Date Payment), Section 3.2 (Authority), or Section 3.4 (Brokers), and in each such case the representations
and warranties set forth therein shall survive indefinitely or until the expiration of the applicable statute of limitations with
respect thereto, as applicable (collectively, the representations and warranties in clause (b) above are referred to herein as
the “Fundamental Representations”). All covenants and other agreements set forth herein shall survive indefinitely,
unless such covenant or agreement expressly terminates on an earlier date.

 

    	 	19	 

     

    

 

Section 6.2           Indemnification.

 

(a)          TVV
(a “Seller Indemnifying Party”) hereby agrees to defend, indemnify and hold the Buyer, the Company, and their
respective Equity Interest holders, directors, officers, employees, agents, managers, and Affiliates (other than any person who
is a Stockholder or the holder of Equity Interests of the Company as of the Closing Date) (parties receiving the benefit of the
indemnification agreement under this Section 6.2 shall be referred to collectively as “Buyer Indemnified Parties”
and individually as a “Buyer Indemnified Party”) harmless from and against any and all claims, damages, liabilities,
losses, fines, penalties, costs, and expenses (including, without limitation, reasonable fees of legal counsel), as the same are
incurred, of any kind or nature whatsoever (whether or not arising out of third-party claims and including all amounts paid in
investigation, defense or settlement of the foregoing, including, without limitation, the enforcement of any indemnification award
hereunder) (collectively “Losses” and each individually, a “Loss”) which may be sustained
or suffered by any Buyer Indemnified Party to the extent arising out of:

 

(i)          any
breach of any representation or warranty made by the Company or TVV in this Agreement or the Schedules hereto (collectively, “Buyer
Warranty Claims”);

 

(ii)         any
breach of any obligation, agreement or covenant made by TVV in this Agreement;

 

(iii)        
(A) any Taxes on or with respect to the Company for any Pre-Closing Period; (B) any Taxes of the Company pursuant to Treasury Regulations
Section 1.1502-6 or any analogous or similar state, local, or foreign law or regulation; (C) any Taxes of any Person imposed on
the Company as a transferee or successor, by contract or pursuant to any Law which Taxes relate to an event or transaction occurring
on or before the Closing Date; and (D) any breach of any covenant in Section 5.2;

 

(iv)        any
claim for indemnification or advancement or reimbursement of expenses made or asserted against the Company by any present or former
officer, director and/or employee of the Company who is an Affiliate of TVV, with respect to any action taken or omitted to be
taken by any such officer, director and/or employee of the Company prior to the Closing; or

 

(v)         any
fraud by the Company or TVV.

 

The rights
of Buyer Indemnified Parties to recover indemnification in respect of any occurrence referred to in clause (v) of this Section
6.2(a) shall not be limited by the fact that such occurrence may not constitute an inaccuracy in or breach of any representation,
warranty, covenant or agreement set forth in this Agreement or in any Schedule hereto. A Buyer Indemnified Party may simultaneously
bring multiple claims for indemnity based on one or more legal theories and based upon one or more provisions of this Agreement
with respect to the same event, occurrence or set of facts; provided, that any liability for indemnification under this
Section 6.2(a) shall be determined without duplication of recovery by reason of the state of facts giving rise to such liability
constituting a breach of more than one representation, warranty, covenant or agreement.

 

(b)          The
Buyer (the “Buyer Indemnifying Party”) hereby agrees to defend, indemnify and hold TVV and its Affiliates (parties
receiving the benefit of the indemnification agreement under this Section 6.2(b) shall be referred to collectively as “Seller
Indemnified Parties” and individually as a “Seller Indemnified Party”) harmless from and against any
and all Losses which may be sustained or suffered by any such Seller Indemnified Party to the extent arising out of:

 

    	 	20	 

     

    

 

(i)          any
breach of any representation or warranty made by the Buyer in this Agreement (collectively, “Seller Warranty Claims”);

 

(ii)         any
breach of any obligation, agreement or covenant, made by the Buyer in this Agreement; or

 

(iii)        any
fraud by the Buyer.

 

The rights
of Seller Indemnified Parties to recover indemnification in respect of any occurrence referred to in clause (iii) of this Section
6.2(b) shall not be limited by the fact that such occurrence may not constitute an inaccuracy in or breach of any representation,
warranty, covenant or agreement set forth in this Agreement. A Seller Indemnified Party may simultaneously bring multiple claims
for indemnity based on one or more legal theories and based upon one or more provisions of this Agreement with respect to the same
event, occurrence or set of facts.

 

(c)          Subject
to Section 6.1 and Section 6.2(d), the time period for making claims for indemnification with respect to Seller Warranty
Claims or Buyer Warranty Claims shall expire and terminate on the Expiration Date; provided, however, that indemnification
for any Loss related to any of the representations set forth in Section 6.1(a) shall not expire until the second anniversary
of the Closing Date, and indemnification for any Loss related to any of the Fundamental Representations shall either (i) expire
on the expiration date of the applicable statute of limitations or (ii) never expire, as applicable. In addition, the period for
making indemnification claims under any of Section 6.2(a)(ii) through (v), Section 6.2(b)(ii), or Section
6.2(b)(iii) shall never expire, provided a claim is made prior to any express termination date of any covenant or agreement
set forth in such Sections.

 

(d)          If
prior to the relevant expiration date set forth in Section 6.2(c), a Seller Indemnified Party or Buyer Indemnified Party
shall have given written notice of a claim pursuant to Section 6.3 below, then the right to indemnification with respect
to such claim shall survive any applicable expiration date until such claim is finally adjudicated.

 

(e)          Notwithstanding
anything contained in this Section 6.2 to the contrary, the rights of an Indemnified Party to recover indemnification in
respect of any claim arising under this Section 6.2 shall be subject to the following limitations:

 

(i)          Neither
any Buyer Indemnifying Party, on the one hand, nor any Seller Indemnifying Party, on the other hand, shall have any obligation
to indemnify any Seller Indemnified Party or any Buyer Indemnified Party, respectively, pursuant to Section 6.2(a)(i), unless
the aggregate of all Losses suffered or incurred by all Buyer Indemnified Parties or Seller Indemnified Parties, as applicable,
which would otherwise be subject to indemnification hereunder exceeds $60,000.00 in the aggregate (the “Deductible”),
whereupon the total amount of such Losses in excess of the Deductible shall be recoverable in accordance with the terms hereof;
provided, however, that the Deductible shall not apply with respect to any claim brought under (A) any of Section 6.2(a)(ii)
through Section 6.2(a)(v), (B) Section 6.2(b)(ii) or Section 6.2(b)(iii), or (C) Section 6.2(a)(i)
solely with respect to claims for breaches of Fundamental Representations or any representations and warranties set forth in Section
2.12 (Tax Matters) or Section 2.21 (Environmental Matters) (claims under any of clause (A), clause (B) or clause
(C) are collectively referred to as “Excluded Claims”).

 

    	 	21	 

     

    

 

(ii)         Neither
any Buyer Indemnifying Party, on the one hand, nor any Seller Indemnifying Party, on the other hand, shall have any obligation
to indemnify any Seller Indemnified Party or any Buyer Indemnified Party, respectively, pursuant to Section 6.2(a)(i), for
Losses in excess of $500,000.00 (the “Cap”); provided, however, that the Cap shall not apply to Excluded
Claims, and (A) indemnification for Losses with respect to Excluded Claims pursuant to Section 6.2(a)(i) solely with respect
to claims related to representations and warranties set forth in Section 2.12 (Tax Matters) or Section 2.21 (Environmental
Matters) shall be limited to Two Million Dollars ($2,000,000), and (B) indemnification for Losses with respect to Excluded
Claims pursuant to Section 6.2(a)(i) solely with respect to claims related to Fundamental Representations or any claim brought
under any of Sections 6.2(a)(ii) through Section 6.2(a)(v), or Section 6.2(b)(ii) or Section 6.2(b)(iii),
shall be limited to the Purchase Price. Furthermore, for the avoidance of doubt, neither the Deductible nor the Cap shall apply
to any post-Closing adjustments pursuant to Section 1.4.

 

(iii)        The
liability of TVV for any indemnifiable Loss hereunder shall be limited to 97.07% of the amount of the indemnifiable Loss.

 

Section 6.3           Notice;
Payment of Losses; Defense of Claims. 

 

(a)          The
term “Indemnifying Party” shall include the Buyer Indemnifying Parties and Seller Indemnifying Parties, as applicable,
and the term “Indemnified Party” shall include a Buyer Indemnified Party or Seller Indemnified Party, as applicable.
Each Indemnified Party is an express third party beneficiary of this Agreement and shall have each and every legal or equitable
right, remedy or claim as set forth under this Agreement and shall be entitled to enforce each such right, remedy or claim, subject
to any requirements, conditions or other limitations set forth in this Agreement as if such Person were a party hereto.

 

(b)          An
Indemnified Party shall give written notice to the appropriate Indemnifying Party promptly upon learning of any such claim with
respect to which such Indemnified Party seeks indemnity hereunder, and in any event not later than thirty (30) days after assertion
of any written claim by any third party, specifying in reasonable detail the amount, nature and source of the claim; provided,
however, that failure to give such notice shall not limit the right of an Indemnified Party to recover indemnity except to
the extent that the Indemnifying Party is materially prejudiced as a result of such failure and then only to the extent of such
material prejudice.

 

(c)          Within
twenty (20) days after receiving notice of a claim for indemnification, the Indemnifying Party shall, by written notice to the
Indemnified Party, either (i) concede or deny liability for the claim in whole or in part or (ii) in the case of a claim asserted
by a third party, advise that the matters set forth in the notice are, or will be, subject to contest or legal proceedings not
yet finally resolved. If the Indemnifying Party concedes liability in whole, the Indemnifying Party shall pay the amount of such
claim in cash to the Indemnified Party within five (5) business days of notice of such concession. If the Indemnifying Party denies
liability in whole or in part or advises that the matters set forth in the notice are, or will be, subject to contest or legal
proceedings not yet finally resolved, then the Indemnifying Party shall make no payment until a final resolution of the matter
is obtained in accordance with this Agreement. If an Indemnifying Party denies liability in whole or in part, and such matter is
finally resolved in favor of the Indemnified Party, such Indemnifying Party shall be liable for (A) the amount of the Losses sustained
or suffered by the Indemnified Party plus (B) interest (computed on the basis of a 360-day year/30-day month) on the Losses at
a rate per annum of six percent (6%) assessed from the date that is thirty (30) days after the date on which the Indemnifying Party
received notice of such Losses from the Indemnified Party under Section 6.3(b). If an Indemnifying Party fails to respond
by written notice to the Indemnified Party within twenty (20) days after receiving notice of a claim for indemnification, such
Indemnifying Party shall be deemed to have conceded liability for the claim in whole and to have irrevocably agreed to pay (A)
the amount of the Losses sustained or suffered by the Indemnified Party plus (B) interest (computed on the basis of a 360-day
year/30-day month) on the Losses at a rate per annum of six percent (6%) assessed from the date that is thirty (30) days after
the date on which the Indemnifying Party received notice of such Losses from the Indemnified Party under Section 6.3(b).

 

    	 	22	 

     

    

 

(d)          In
the case of any third party claim, if within twenty (20) days after receiving the notice of a claim under Section 6.3(b),
the Indemnifying Party (i) gives written notice to the Indemnified Party stating that it would be liable under the provisions hereof
for indemnity in the amount of such claim if such claim were valid and that it disputes and intends to defend against such claim,
liability or expense at its own cost and expense and (ii) provides reasonable assurance to such Indemnified Party that such indemnification
will be paid fully and promptly if required and such Indemnified Party will not incur cost or expense during the proceeding, then
counsel for the defense shall be selected by the Indemnifying Party and the Indemnifying Party shall control the defense of such
claim, subject to the consent of all Indemnified Parties which consent shall not be unreasonably withheld, conditioned or delayed;
provided, that so long as a conflict of interest does not exist, (A) the Buyer, on behalf of all Buyer Indemnified Parties,
hereby approves Bass, Berry & Sims, PLC to serve as counsel to any Seller Indemnifying Party, and (B) TVV, on behalf of all
Seller Indemnified Parties, hereby approves Neuberger, Quinn, Gielen, Rubin & Gipper, P.A. to serve as counsel to any Buyer
Indemnifying Party. The assumption of defense of any such matters by the Indemnifying Party or Parties shall relate solely to the
claim, liability or expense that is subject to indemnification. If the Indemnifying Party or Parties assume such defense in accordance
with this Section 6.3, they shall have the right, with the consent of such Indemnified Party or Parties, which consent shall
not be unreasonably withheld, conditioned or delayed, to settle all indemnifiable matters related to the claim, liability or expense
that is subject to indemnification. The Indemnifying Party or Parties shall keep such Indemnified Party or Parties promptly and
reasonably apprised of the status of the claim, liability or expense and any resulting suit, proceeding or enforcement action,
shall furnish such Indemnified Party or Parties with all documents and information that such Indemnified Party or Parties shall
reasonably request and shall consult with such Indemnified Party or Parties prior to acting on major matters, including settlement
discussions. Notwithstanding anything herein stated, such Indemnified Party or Parties shall at all times have the right to fully
participate in such defense at its own expense directly or through counsel; provided, however, if the named parties to the
action or proceeding include both the Indemnifying Party or Parties and the Indemnified Party or Parties and representation of
both parties by the same counsel would be inappropriate under applicable standards of professional conduct, the reasonable expense
of separate counsel for such Indemnified Party or Parties shall be paid by the Indemnifying Party or Parties. If no such notice
of intent to dispute and defend is given by the Indemnifying Party or Parties, or if such diligent good faith defense is not being
or ceases to be conducted (following delivery of written notice asserting the failure to conduct a diligent and good faith defense
and a thirty (30) day opportunity to cure), such Indemnified Party or Parties shall, at the expense of the Indemnifying Party or
Parties, undertake the defense of (with counsel selected by such Indemnified Party or Parties), and shall have the right to compromise
or settle, such claim, liability or expense. If such claim, liability or expense is one that by its nature cannot be defended solely
by the Indemnifying Party or Parties, then such Indemnified Party or Parties shall make available all information and assistance
that the Indemnifying Party or Parties may reasonably request and shall cooperate with the Indemnifying Party or Parties in such
defense.

 

(e)          Notwithstanding
any provision in this Section 6.3 to the contrary, no Seller Indemnifying Party shall have the right to assume or maintain,
as applicable, control of the defense of any third party claim under Section 6.3(d) if any such third party claim (i) seeks
non-monetary relief, (ii) involves criminal allegations, (iii) involves Losses that are not expected to exceed the Deductible (to
the extent indemnity payments for such Losses are subject to the Deductible), (iv) involves Losses that are reasonably expected
to exceed the maximum amount for which the Seller Indemnifying Parties could be liable under this Article VI, (v) involves
Taxes, or (vi) is one in which the Buyer Indemnified Party reasonably believes an adverse determination with respect thereto could
be materially detrimental to the reputation or future business prospects of any Buyer Indemnified Party.

 

(f)          Subject
to the terms of the Escrow Agreement, the Escrow Amount will be available to compensate the Buyer Indemnified Parties for Losses
for which such Buyer Indemnified Parties are entitled to indemnification pursuant to Section 6.2.

 

Section 6.4           Characterization
of Indemnity Payments. Any indemnification
payments made pursuant to this Agreement shall be considered, to the extent permissible under Law, as adjustments to the Purchase
Price for all Tax purposes.

 

    	 	23	 

     

    

 

Section 6.5           Limitation
on Contribution and Certain Other Rights; No Circular Indemnity; Waiver of Rights. TVV
(on behalf of itself and its Affiliates and Representatives) hereby agrees that if, following the Closing, any payment is made
by TVV, or otherwise becomes due from TVV pursuant to Section 1.4, this Article VI or relating to fraud, fraud in
the inducement, intentional misrepresentation or relating to the pursuit of equitable remedies, including, but not limited to,
specific performance and injunctive relief, in respect of any Loss (each a “Loss Payment”), neither TVV nor
any Affiliate or Representative of TVV shall have any rights against any Buyer Indemnified Party, whether by reason of contribution,
indemnification, subrogation or otherwise, in respect of any such Loss Payment, it being understood that for the purposes of this
Section 6.5 neither Hennis nor Wilberding shall be deemed to be a Buyer Indemnified Party by virtue of their being
an Equity Interest holder of the Buyer. TVV (on behalf of itself and its Affiliates and Representatives) hereby further agrees
that neither TVV nor any Affiliate or Representative of TVV will make any claim for indemnification against the Buyer or any of
its Affiliates (including the Company), or any director, officer or employee of any of the foregoing, under the organizational
documents of the Company by reason of the fact that TVV (or any Affiliate or Representative of TVV) is or was an Equity Interest
holder, director, officer, manager or agent of the Company or is or was serving at the request of the Company as a member, director,
officer, partner, trustee or agent of another entity (whether such claim is for judgments, damages, penalties, fines, costs, amounts
paid in settlement, Losses, expenses or otherwise and whether such claim is pursuant to any statute, charter document, by-law,
agreement or otherwise) with respect to any action, suit, proceeding, complaint, claim or demand brought by any of the Buyer Indemnified
Parties against any Seller Indemnifying Party pursuant to this Agreement or otherwise relating thereto.

 

Section 6.6           Exclusivity
of Indemnification. The parties hereto agree
that, except as set forth in Section 1.4 and Section 5.2, the indemnification provisions of this Article VI
are intended to provide the exclusive remedy for money damages as to all Losses that they may incur arising from or relating to
the transactions contemplated hereby and any other Transaction Agreement. Notwithstanding the foregoing, this 0 shall not
be interpreted to limit the rights or remedies of any party hereto in the case of fraud, fraud in the inducement, intentional
misrepresentation or in respect of the pursuit of equitable remedies, including, but not limited to, specific performance and
injunctive relief.

 

Article
VII

GENERAL PROVISIONS

 

Section 7.1           Notices. 
All notices, requests, claims, demands and other communications under this Agreement must be in writing and will be deemed given
if delivered personally, sent by overnight courier (providing proof of delivery) or via facsimile or email (providing proof of
sending) to the parties at the following addresses (or at such other address for a party as specified by like notice):

 

(a)          if
to the Company, to:

 

INDCO, Inc.

4040 Earnings Way

New Albany, IN 47150

Attn: C. Mark Hennis

Facsimile: (800) 942-9742

Email: hennis@indco.com

 

(b)          if
to the Buyer, to:

 

Janel Corporation

303 Merrick Road, Suite 400

Lynbrook, New York 11563

Attn: Brendan J. Killackey, CEO

Facsimile: (516) 593-0925

Email: bkillackey@Janelgroup.net

 

with a copy to:

 

Neuberger, Quinn, Gielen, Rubin &
Gibber, P.A.

One South Street, 27th Floor

 

    	 	24	 

     

    

 

Baltimore, Maryland 21202

Attn: Hillel Tendler

Facsimile: 410-332-8553

Email: ht@nqgrg.com

 

(c)          if
to TVV, to:

 

Tennessee Valley Ventures II, L.P.

201 Fourth Avenue North, Suite 1250

Nashville, TN 37219

Attn: Andrew W. Byrd

Facsimile: (615) 256-7057

Email: andrew@tvvcapital.com

 

with a copy to:

 

McKenzie Laird, PLLC

3835 Cleghorn Avenue, Suite 250

Nashville, TN 37215

Attn: Donald I.N. McKenzie

Facsimile: (615) 297-7040

Email: dmckenzie@mckenzielaird.com

 

Section 7.2           Disclosure
Schedules. Information set forth in the schedules
to this Agreement (the “Schedules”) shall modify, supplement, qualify or limit the representations made in
Article II, Article III or Article IV, respectively. The Section number headings in the Schedules correspond
to the Section numbers in this Agreement.

 

Section 7.3           Assignability;
Binding Agreement; Third Party Beneficiary. Except
as expressly permitted by the terms hereof, neither this Agreement nor any of the rights, interests or obligations hereunder shall
be assigned (whether by operation of Law or otherwise) by any of the parties hereto without the prior written consent of the other
parties provided, however, that the Buyer may, without the consent of any of the other parties, assign the rights
of the Buyer (including its rights under Article VI) under this Agreement and the Company may, without the consent of any
of the other parties, assign the rights of the Company under this Agreement (a) for collateral security purposes to any lender
of the Buyer or the Company, respectively, (b) a wholly-owned subsidiary of the Buyer, or (c) to any successor in interest of
the Buyer or the Company, respectively; provided, further, that no such assignment shall relieve Buyer from any of its
obligations hereunder. This Agreement shall be binding upon and enforceable by, and shall inure to the benefit of, the parties
hereto and their respective successors, heirs, executors, administrators and permitted assigns, and no others. Notwithstanding
the foregoing and except as provided in Article VI, nothing in this Agreement is intended to give any Person not named
herein the benefit of any legal or equitable right, remedy or claim under this Agreement, except as expressly provided herein,
and no such Persons shall have any such rights, remedies or claims.

 

Section 7.4           Severability. Whenever
possible, each provision of this Agreement shall be interpreted in such a manner as to be effective and valid under Law, but if
any provision (or part thereof) of this Agreement shall be deemed prohibited or invalid under such Law, such provision (or part
thereof) shall be ineffective to the extent of such prohibition or invalidity, and such prohibition or invalidity shall not invalidate
the remainder of such provision or the other provisions of this Agreement.

 

Section 7.5           No
Agreement Until Executed. Irrespective of negotiations
among the parties or the exchanging of drafts of this Agreement, this Agreement shall not constitute or be deemed to evidence
a contract, agreement, arrangement or understanding among the parties hereto unless and until this Agreement is executed and delivered
by the parties hereto.

 

Section 7.6           Certain
Definitions. For purposes of this Agreement:

 

(a)          “Adjustment
Time” means the open of business Eastern time on the Closing Date.

 

    	 	25	 

     

    

 

(b)          An
“Affiliate” of a Person means (i) with respect to an individual, such individual’s spouse, children (natural
or adopted), or any other direct lineal descendant of such individual or his spouse; (ii) with respect to an entity, any officer,
director, holder of an Equity Interest representing at least 10% of the voting power of the issuer of such Equity Interest, general
partner, manager or trustee of such entity; and (iii) with respect to an individual or entity, any Person which directly or indirectly
Controls, is Controlled by, or is under common Control with such Person.

 

(c)          “Business
Day” means any day other than a Saturday or Sunday or weekday on which banks in Indianapolis, Indiana are authorized
or required to be closed.

 

(d)          “Cash
and Cash Equivalents” means all cash on hand and cash equivalents that are immediately convertible into cash (including
interest receivable thereupon) determined in accordance with GAAP and the Company’s past practices consistently applied,
less any Restricted Cash (as defined below).

 

(e)          “Code”
means the Internal Revenue Code of 1986, as amended.

 

(f)          “Company
Expenses” means all fees and expenses of TVV or the Company incurred in connection with the negotiation and the consummation
of the transactions contemplated by this Agreement or payable upon the consummation of the transactions contemplated by this Agreement.

 

(g)          “Confidential
Information” means all information of or regarding the Buyer, the Company, or any of their respective Affiliates, including,
without limitation: (i) information regarding operations, assets, liabilities or financial condition; (ii) information regarding
employees, contractors, subcontractors, sales agents or sales representatives; (iii) customer lists or other information related
to customers; (iv) information regarding vendors, suppliers, distributors or other business partners; (v) forecasts, projections,
budgets and business plans; (vi) trade secrets and proprietary information; or (vii) the terms of this Agreement.

 

(h)          “Contractual
Obligation” means, with respect to any Person, any contract, agreement, deed, mortgage, lease, sublease, license, commitment,
promise or undertaking, whether written or oral, or other document or instrument to which or by which such Person is a party or
otherwise bound or to which or by which any property, business, operation or right of such Person is bound.

 

(i)          “Control”
(including the terms “Controlled by” and “under common Control with”) means the possession, directly or
indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership
of voting Equity Interests, by contract or otherwise.

 

(j)          “Employee
Benefit Program” means (i) an employee benefit plan within the meaning of Section 3(3) of ERISA whether or not subject
to ERISA; and (ii) incentive award plans, bonus plans or arrangements, stock option, stock purchase or equity compensation plans,
phantom equity programs, severance pay plans, programs or arrangements, deferred compensation arrangements or agreements, employment
agreements, executive compensation plans, programs, agreements or arrangements, change in control plans, programs or arrangements,
supplemental income arrangements, vacation plans, and all other employee benefit plans, agreements, and arrangements, not described
in (i) above, in all cases, maintained or sponsored by the Company or any of its ERISA Affiliates or in which employees of the
Company or any of its ERISA Affiliates participate or with respect to which the Company or any of its ERISA Affiliates has or may
have any liability.

 

(k)          “Encumbrance”
means any mortgage, pledge, security interest, claim, charge, lien, option, right of first refusal, easement, restrictive covenant,
restriction and encumbrance of any kind.

 

(l)          “Equity
Interests” means (i) any capital stock, share, partnership or membership interest, unit of participation or other similar
interest (however designated) in any Person and (ii) any option, warrant, purchase right, conversion right, exchange rights or
other contractual obligation which would entitle any Person to acquire any such interest in such Person or otherwise entitle any
Person to share in the equity, profit, earnings, losses or gains of such Person (including stock appreciation, phantom stock, profit
participation or other similar rights).

 

    	 	26	 

     

    

 

(m)          “ERISA
Affiliate” means any entity that would have ever been considered a single employer with the Company under Section 4001(b)
of ERISA or part of the same “controlled group” as the Company for purposes of Section 302(d)(3) of ERISA.

 

(n)          “Exchange
Act” means the Securities Exchange Act of 1934, as amended.

 

(o)          “Expiration
Date” means the first (1st) anniversary of the Closing Date.

 

(p)          “GAAP”
means generally accepted accounting principles as applied in the United States.

 

(q)          “General
Enforceability Exceptions” means (i) applicable bankruptcy, reorganization, insolvency, moratorium or other similar Laws
affecting the enforcement of creditors’ rights and remedies generally from time to time in effect and (ii) the application
of equitable principles (regardless of whether enforceability is considered in a proceeding at law or in equity).

 

(r)          “Governmental
Authority” means any government or political subdivision, whether federal, state, local or foreign, or any agency or
instrumentality of any such government or political subdivision, or any federal, state, local or foreign court having competent
jurisdiction.

 

(s)          “Hennis
Employment Agreement” means that certain Employment Agreement dated as of the Closing Date by and between the Company
and Hennis, on terms acceptable to the Buyer

 

(t)          “Indebtedness”
means, with respect to the Company, (i) indebtedness for borrowed money, (ii) indebtedness for the deferred purchase price of property
or services, (iii) any indebtedness evidenced by any note, bond, debenture or other debt security; (iv) obligations as lessee under
leases which have been or should be, in accordance with GAAP consistently applied, recorded as capital leases; (v) all accrued
and unpaid interest on or any premiums, fees, penalties, expenses or other amounts due with respect to (i) through (iv) above;
and (vi) any obligations of any other Person or a type referred to in clauses (i) through (v) to the extent directly or indirectly
guaranteed by the Company.

 

(u)          “Intellectual
Property” means (i) patents and patent applications (collectively, “Patents”), (ii) registered trade
names, trade dress, logos, slogans, Internet domain names, registered and unregistered trademarks and service marks and related
registrations and applications for registration, and all goodwill symbolized thereby (collectively, “Marks”),
(iii) registered copyrights in both published and unpublished works, including without limitation all compilations, databases and
computer programs, manuals and other documentation and all copyright registrations and applications (collectively, “Copyrights”),
(iv) rights under applicable US state trade secret Laws as are applicable to know-how and confidential information, and (v) computer
software (including, without limitation, source code, executable code, data, databases, and documentation).

 

(v)         “Knowledge”
means the facts, circumstance or other information that are actually known by an individual. The phrases “to the Company’s
Knowledge,” “to the Knowledge of the Company” or similar uses of Knowledge coupled with the Company shall mean
the facts, circumstance or other information that are actually known by Hennis or Wilberding after conducting a reasonable investigation

 

(w)          “Law”
means any domestic, foreign, state or local statute, law, ordinance, rule, regulation, order of general applicability of any Governmental
Authority.

 

(x)          “Net
Working Capital” means, with respect to the Company, as of the respective balance sheet date: (i) the sum of inventory,
accounts receivable (net of allowances for bad debt), prepaid expenses, prepaid insurance, and prepaid catalog expenses, less
(ii) the sum of accounts payable, credit card payable, customer deposits, refunds for product returns, accrued salaries and payroll
taxes, accrued bonus plan, accrued profit sharing, accrued 401(k) Plan payable, and sales tax payable, in each case, determined
in accordance with GAAP.

 

    	 	27	 

     

    

 

(y)          “Order”
means any order, injunction, judgment, decree or ruling, or arbitration award of any Governmental Authority or arbitrator.

 

(z)          “Ordinary
course of business” means, with respect to any Person, the usual and ordinary course of such Person’s business
consistent with past practice (including with respect to frequency, quantity and magnitude).

 

(aa)         “Person(s)”
means an individual, corporation, partnership, limited liability company, joint venture, association, trust, unincorporated organization
or other entity or group (as defined in Section 13(d) of the Exchange Act).

 

(bb)         “Pre-Closing
Period” means any taxable year or period that ends on or before the Closing Date and, with respect to any taxable year
or period beginning before and ending after the Closing Date, the portion of such taxable year or period ending on and including
the Closing Date.

 

(cc)         “Property
Taxes” means real, personal and intangible ad valorem property taxes.

 

(dd)         “Representative”
means, with respect to any party hereto, any agent, trustee, director, manager, officer, employee, attorney, accountant, or other
representative of such party.

 

(ee)         “Restricted
Cash” means all pre-paid accounts, customer deposits, insurance and customer refunds, other deposits and an amount of
cash necessary to cover the aggregate amount of all checks or wires drawn against any bank account of the Company that have not
cleared prior to the Closing.

 

(ff)         “Rollover
Amount” means (x) $[___________], which is the aggregate value attributed to the rollover shares of common
stock of the Company retained by Hennis set forth under the heading “Shares of Rollover Stock” on Exhibit A,
as such amount may be adjusted in the Closing Statement, plus (y) the principal amount of the Hennis Redemption Note.

 

(gg)         “Subsidiary”
means, with respect to any Person (the “Subject Person”), any corporation more than 50% of whose outstanding
voting securities, or any partnership, joint venture or other entity more than 50% of whose total Equity Interests, are directly
or indirectly owned by such Subject Person.

 

(hh)         “Target
Working Capital” means $835,000.00.

 

(ii)         
“Tax” or “Taxes” means any federal, state, local or foreign income, gross receipts, capital
gains, franchise, alternative or add-on minimum, estimated, sales, use, goods and services, transfer, registration, value added,
excise, natural resources, severance, stamp, occupation, premium, windfall profit, environmental, customs, duties, real property,
special assessment, personal property, capital stock, social security, unemployment, employment, disability, payroll, employee
or other withholding, contributions or other tax, of any kind whatsoever, including any interest, penalties or additions to tax
or additional amounts in respect of the foregoing.

 

(jj)         
“Tax Returns” means returns, declarations, reports, claims for refund, information returns or other documents
(including any related or supporting schedules, statements or information) filed or required to be filed in connection with the
determination, assessment or collection of Taxes of any party or the administration of any laws, regulations or administrative
requirements relating to any Taxes.

 

    	 	28	 

     

    

 

(kk)         “Transaction
Agreements” means this Agreement and any other agreement entered into by the parties or any of them in connection with
the transactions contemplated by this Agreement, including the Escrow Agreement, the Hennis Employment Agreement and the Wilberding
Employment Agreement.

 

(ll)         “Wilberding
Employment Agreement” means that certain Employment Agreement dated as of the Closing Date by and between the Company
and Wilberding, on terms acceptable to the Buyer.

 

(mm)         “Hennis
Redemption Note” means the Company’s unsecured promissory note due ninety (90) days after the date of this Agreement,
issued to Hennis for the purchase and redemption of 10,000 shares of Common Stock.

 

Section 7.7           Interpretation. When
a reference is made in this Agreement to an Article, Section, Exhibit or Schedule, such reference will be to an Article or Section
of, or a Schedule or Exhibit to, this Agreement unless otherwise indicated. The table of contents and headings contained in this
Agreement are for reference purposes only and will not affect in any way the meaning or interpretation of this Agreement. Whenever
the words “include”, “includes” or “including” are used in this Agreement, they will be deemed
to be followed by the words “without limitation.” Where the context permits, the use of the term “or”
will be non-exclusive and equivalent to the use of the term “and/or.” The words “hereof,” “herein”
and “hereunder” and words of similar import when used in this Agreement will refer to this Agreement as a whole and
not to any particular provision of this Agreement. All terms used herein with initial capital letters have the meanings ascribed
to them herein and all terms defined in this Agreement will have such defined meanings when used in any certificate, exhibits
or schedules or other document made or delivered pursuant hereto unless otherwise defined therein. The definitions contained in
this Agreement are applicable to the singular as well as the plural forms of such terms and to the masculine as well as to the
feminine and neuter genders of such term. Any agreement, instrument or statute defined or referred to herein, or in any agreement
or instrument that is referred to herein, means such agreement, instrument or statute as from time to time amended, modified or
supplemented, including (in the case of agreements or instruments) by waiver or consent and (in the case of statutes) by succession
of comparable successor statutes and references to all attachments thereto and instruments incorporated therein. References to
a Person are also to its permitted successors and assigns. Accounting terms used and not otherwise defined herein shall have the
meanings given to them by GAAP, consistently applied. The term “certificate, exhibits or schedules” when used herein
is not intended to incorporate preexisting agreements between the Company and unrelated third parties that may be attached or
delivered as part of an exhibit or schedule but have not been made with reference or in connection with this Agreement or the
Closing.

 

Section 7.8           Fees
and Expenses. Subject to Section 1.3(c),
and except as otherwise set forth in this Agreement, each of the Buyer, on the one hand, and the Company and TVV, on the other
hand, shall bear their own expenses in connection with the negotiation and the consummation of the transactions contemplated by
this Agreement.

 

Section 7.9           Governing
Law. This Agreement will be governed
by, and construed in accordance with, the internal Laws of the State of Indiana regardless of the Laws that might otherwise govern
under applicable principles of conflict of laws.

 

Section 7.10         Specific
Performance. The parties hereto agree that
irreparable damage could occur in the event that any of the covenants in this Agreement were not performed in accordance with
their specific terms or were otherwise breached. It is accordingly agreed that the parties shall be entitled to seek an injunction
or injunctions to prevent breaches of the covenants set forth in this Agreement and to enforce specifically the terms and provisions
of the covenants hereof in accordance with Section 7.11. Such remedies shall not be exclusive and shall be in addition
to any other remedies that any party may have under Article VI.

 

    	 	29	 

     

    

 

Section 7.11         Venue;
Consent to Jurisdiction. Except as for
all disputes, claims, or controversies arising out of Section 1.4 (Post-Closing Adjustments) (which disputes, claims, or
controversies shall be resolved exclusively as set forth in Section 1.4), all disputes, claims, or controversies arising
out of or relating to this Agreement or any of the other Transaction Agreements or the transactions contemplated hereby or thereby
or the negotiation, validity or performance hereof or thereof that are not resolved by mutual agreement shall only be brought
in the federal courts situated in the County of Marion in the State of Indiana (including the appropriate appellate courts therefrom).
Each of the parties hereto irrevocably and unconditionally consents to the exclusive jurisdiction of such federal courts to resolve
all such disputes, claims or controversies and further consents to the jurisdiction of such federal courts for the purposes of
enforcing the provisions of Section 1.4; provided, however, that to the extent necessary to avoid irreparable
harm, any party may seek temporary or preliminary injunctive relief in accordance with Section 7.10 in any court of competent
jurisdiction. EACH OF THE PARTIES HERETO HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVES ANY RIGHTS SUCH PARTY MAY HAVE
TO A TRIAL BY JURY IN RESPECT OF ANY SUCH disputes, claims or controversies. Each
party hereto further irrevocably waives any objection to any proceeding before such federal courts based upon lack of personal
jurisdiction or to the laying of venue in such federal courts and further irrevocably and unconditionally waives and agrees not
to make a claim in any court that any proceeding before such federal courts has been brought in an inconvenient forum. Each of
the parties hereto hereby consents to service of process by registered mail at the address to which notices are to be given hereunder.
Each of the parties hereto hereby agrees that its submission to jurisdiction and its consent to service of process by mail are
made for the express benefit of the other parties hereto. The parties agree and intend that the pendency of a proceeding pursuant
to Section 1.4 of this Agreement shall not preclude the ability of any party to bring an action under this Section 7.11
with respect to any dispute or controversy to which this Section 7.11 applies.

 

Section 7.12         Mutual
Drafting. The parties hereto are sophisticated
and have been represented by attorneys throughout the transactions contemplated hereby who have carefully negotiated the provisions
hereof. As a consequence, the parties do not intend that the presumptions of Laws or rules relating to the interpretation of contracts
against the drafter of any particular clause should be applied to this Agreement or any agreement or instrument executed in connection
herewith, and therefore waive their effects.

 

Section 7.13         Integration. This
Agreement and the Transaction Agreements, including the schedules, exhibits, documents and instruments referred to herein or therein,
constitutes the entire agreement, and supersedes all other prior agreements and understandings, both written and oral, among the
parties with respect to the subject matter hereof and thereof.

 

Section 7.14         Counterparts. This
Agreement may be executed and delivered by facsimile signature or portable document format (PDF) by electronic mail and in any
number of counterparts, each of which when so executed and delivered shall be deemed an original, but all of which together shall
constitute one and the same instrument.

 

Section
7.15         Amendments, Waivers and Consents. For
the purposes of this Agreement and all agreements executed pursuant hereto, no course of dealing between or among any of the parties
hereto and no delay on the part of any party hereto in exercising any rights hereunder or thereunder shall operate as a waiver
of the rights hereof and thereof. No provision hereof may be waived otherwise than by a written instrument signed by the party
or parties so waiving such covenant or other provision. Waiver of any term or condition of this Agreement by a party shall not
be construed as a waiver of any subsequent breach or waiver of the same term or condition by such party, or a waiver of any other
term or condition of this Agreement by such party. No amendment to this Agreement may be made without the written consent of TVV,
the Company and the Buyer.

 

[Signature page immediately follows.]

 

    	 	30	 

     

    

 

IN WITNESS WHEREOF, the
parties hereto have caused this Stock Purchase Agreement to be signed personally, or by their respective officers thereunto duly
authorized, all as of the date first written above.

  

	BUYER:	 	COMPANY:
	 	 	 
	JANEL CORPORATION	 	INDCO, INC.
	 	 	 
	By:	/s/ Brendan J. Killackey	 	By:	 /s/ C. Mark Hennis
	 	Brendan J. Killackey	 	 	C. Mark Hennis, President
	 	Chief Executive Officer	 	 

 

	 	 	SELLING STOCKHOLDER:
	 	 	 
	 	 	TENNESSEE VALLEY VENTURES, II, L.P.
	 	 	 
	 	 	By:	TVV Equity Investors II, LLC,
	 	 	 	Its General Partner
	 	 	 
	 	 	By:	/s/ Andrew W. Byrd
	 	 	 	Andrew W. Byrd, President

 

Signature Page to

Stock Purchase Agreement

 

     

     

    

 

ANNEX A

Defined Terms

 

	Term	 	Section Reference
	 	 	 
	Accounting Referee	 	Section 1.4(c)
	Adjustment Time	 	Section 7.6(a)
	Affiliate	 	Section 7.6(b)
	Agreement	 	Introduction
	Base Balance Sheet	 	Section 2.6(a)
	Business Day(s)	 	Section 7.6(c)
	Buyer	 	Introduction
	Buyer Indemnified Party	 	Section 6.2(a)
	Buyer Indemnifying Party	 	Section 6.2(b)
	Buyer Purchase Price Payment Amount	 	Section 1.4(d)
	Buyer Warranty Claims	 	Section 6.2(a)(i)
	Cap	 	Section 6.2(e)(ii)
	Cash and Cash Equivalents	 	Section 7.6(d)
	Closing	 	Section 1.2
	Closing Date	 	Section 1.2
	Closing Date Payment	 	Section 1.3(a)
	Closing Statement	 	Section 1.4(a)
	Closing Statement Response Notice	 	Section 1.4(a)
	Code	 	Section 7.6(e)
	Company	 	Introduction
	Company Expenses	 	Section 7.6(f)
	Company License	 	Section 2.17
	Confidential Information	 	Section 7.6(g)
	Contractual Obligation	 	Section 7.6(h)
	Control	 	Section 7.6(i)
	Copyrights	 	Section 7.6(u)
	Deductible	 	Section 6.2(e)(i)
	Effective Date	 	Section 1.2
	Employee Benefit Program	 	Section 7.6(j)
	Encumbrance	 	Section 7.6(k)
	Environmental Laws	 	Section 2.21
	Equity Interests	 	Section 7.6(l)
	ERISA	 	Section 2.18(a)
	ERISA Affiliate	 	Section 7.6(m)
	Escrow Account	 	Section 1.3(d)
	Escrow Agent	 	Section 1.3(d)
	Escrow Agreement	 	Section 1.3(d)
	Escrow Amount	 	Section 1.3(d)
	Estimated Cash and Cash Equivalents	 	Section 1.3(e)
	Estimated Closing Statement	 	Section 1.3(e)
	Estimated Company Expenses	 	Section 1.3(e)
	Estimated Indebtedness	 	Section 1.3(e)
	Estimated Working Capital	 	Section 1.3(e)
	Exchange Act	 	Section 7.6(n)
	Excluded Claims	 	Section 6.2(e)(i)
	Expiration Date	 	Section 7.6(o)
	Final Closing Date Payment	 	Section 1.4(b)

 

     

     

    

 

	Financial Statements	 	Section 2.6(a)
	Fundamental Representations	 	Section 6.1
	GAAP	 	Section 7.6(p)
	General Enforceability Exceptions	 	Section 7.6(q)
	Governmental Authority	 	Section 7.6(r)
	Hazardous Material	 	Section 2.21
	Hennis	 	Introduction
	Hennis Employment Agreement	 	Section 7.6(s)
	Hennis Redemption Note	 	Section 7.6(mm)
	Indebtedness	 	Section 7.6(t)
	Indemnified Parties	 	Section 6.3
	Indemnifying Parties	 	Section 6.3
	Intellectual Property	 	Section 7.6(u)
	Knowledge	 	Section 7.6(v)
	Knowledge Qualifier	 	Section 6.2(a)(i)
	Law	 	Section 7.6(w)
	Leased Real Property	 	Section 2.11(a)
	Loss(es)	 	Section 6.2(a)
	Loss Payment	 	Section 6.5
	Marks	 	Section 7.6(u)
	Material Contracts	 	Section 2.13(b)
	Materiality Qualifiers	 	Section 6.2(a)(i)
	Net Working Capital	 	Section 7.6(x)
	Order	 	Section 7.6(y)
	ordinary course of business	 	Section 7.6(z)
	Organizational Documents	 	Section 2.1
	Outstanding Disputed Item	 	Section 1.4(c)
	Patents	 	Section 7.6(u)
	Person(s)	 	Section 7.6(aa)
	Pre-Closing Period	 	Section 7.6(bb)
	Property Taxes	 	Section 7.6(cc)
	Purchase Price	 	Section 1.6
	Release Date	 	Section 1.3(d)(i)
	Representative	 	Section 7.6(dd)
	Restricted Cash	 	Section 7.6(ee)
	Restrictive Covenants	 	Section 5.5(b)
	Review Period	 	Section 1.4(a)
	Rollover Amount	 	Section 7.6(ff)
	Schedules	 	Section 7.2
	Seller Indemnified Party	 	Section 6.2(b)
	Seller Indemnifying Party	 	Section 6.2(a)
	Seller Warranty Claims	 	Section 6.2(b)(i)
	Stockholders	 	Introduction
	Stockholder Releasing Parties	 	Section 5.6
	Stock Purchase	 	Recitals
	Stock	 	Recitals
	Straddle Period	 	Section 5.2(b)
	Straddle Returns	 	Section 5.2(a)(ii)
	Subsidiary	 	Section 7.6(ff)
	Target Working Capital	 	Section 7.6(hh)
	Tax(es)	 	Section 7.6(ii)
	Tax Contest	 	Section 5.2(f)

 

    	 	Annex A-2	 

     

    

 

	Tax Returns	 	Section 7.6(jj)
	Transaction Agreements	 	Section 7.6(kk)
	Transfer Taxes	 	Section 5.2(e)
	TVV	 	Introduction
	Unresolved Amount	 	Section 1.3(d)(i)
	WARN	 	Section 2.16
	Wilberding	 	Section 1.7(a)(vi)
	Wilberding Employment Agreement	 	Section 7.6(ll)

 

    	 	Annex A-3	 

     

    

 

EXHIBIT A

Stock

 

	Stockholder	 	Shares of Common Stock of
 the Company	 	 	Shares of Stock	 	 	Shares of Rollover
 Stock	 
	TENNESSEE VALLEY VENTURES, II, L.P.	 	 	601,042	 	 	 	601,042	 	 	 	0	 
	C. MARK HENNIS	 	 	18,125	 	 	 	0	 	 	 	18,125	 
	TOTAL	 	 	619,167	 	 	 	601,042	 	 	 	18,125

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