UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): August 30, 2019

EVO Transportation & Energy Services, Inc.

(Exact name of registrant as specified in its charter)

8285 West Lake Pleasant Parkway, Peoria, AZ 85382

(Address of principal executive offices)

877-973-9191

Registrant’s telephone number, including area code:

Not Applicable

(Former name or former address, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act: None

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registration under any of the following provisions (see General Instruction A.2. below):

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

The disclosures set forth in Items 2.01, 2.03, and 3.02 below are hereby incorporated by reference into this Item 1.01.

Entry into and Closing of Stock Exchange Agreement, Stock Purchase Agreement, and Membership Interest Purchase Agreement

On September 16, 2019, EVO Transportation & Energy Services, Inc., a Delaware corporation (the “Company”), EVO Holding Company, LLC, a Delaware limited liability company (“EVO HoldCo”), Michael Ritter, and Matthew Ritter (together, the “Ritter Owners”) entered into and consummated the transactions contemplated by a stock exchange agreement (the “Exchange Agreement”), a stock purchase agreement (the “Stock Purchase Agreement”), and a membership interest purchase agreement (the “Membership Interest Purchase Agreement”) pursuant to which EVO HoldCo acquired all of the issued and outstanding equity interests (the “Acquired Interests”) in John W. Ritter, Inc., a Maryland corporation (“JWR”), Ritter Transportation Systems, Inc., a Maryland corporation (“Ritter Transportation”), Ritter Transport, Inc., a Maryland corporation (“Ritter Transport”), and Johmar Leasing Company, LLC, a Maryland limited liability company (“Johmar,” and together with JWR, Ritter Transportation, and Ritter Transport, the “Ritter Companies”), from the Ritter Owners. As a result of the transaction, the Ritter Companies became wholly-owned subsidiaries of EVO HoldCo.

The Ritter Companies are based in Laurel, Maryland. JWR is engaged in the business of fulfilling government contracts for freight trucking services as well as providing freight trucking services to non-government entities, Ritter Transportation and Ritter Transport are engaged in the business of providing freight trucking services to non-government entities, and Johmar owns vehicles and related assets for lease to freight trucking companies. Pursuant to the Exchange Agreement, EVO HoldCo acquired all of the outstanding equity interests in JWR for $9,123,907, consisting of $6,102,453 paid by issuance of 2,440,982 shares of Company common stock at a price per share of $2.50 and $3,021,454.63 in assumed indebtedness. Pursuant to the Stock Purchase Agreement, EVO HoldCo acquired all of the outstanding equity interests in Ritter Transportation and Ritter Transport for $13,739,056, which was paid in cash at closing and is subject to a customary working capital adjustment. Pursuant to the Membership Interest Purchase Agreement, EVO HoldCo acquired all of the outstanding equity interests in Johmar for $500,000, which was paid in cash at closing. At closing of the Membership Interest Purchase Agreement, EVO HoldCo also paid off Johmar indebtedness of $3,350,668.59.

The foregoing summary description of the material terms of the Exchange Agreement, the Stock Purchase Agreement, and the Membership Interest Purchase Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the Exchange Agreement, the Stock Purchase Agreement, and the Membership Interest Purchase Agreement, which are filed as Exhibits 2.1, 2.2, and 2.3 to this Current Report on Form 8-K and are incorporated herein by reference in their entirety.

Matthew Ritter Employment Agreement

On September 16, 2019, the Company entered into an executive employment agreement with Matthew Ritter (the “Matthew Ritter Employment Agreement”) pursuant to which Matthew Ritter will serve as Senior Vice President of Freight Business Development of the Company. The Matthew Ritter Employment Agreement provides for an initial term of four years, with automatic extensions (absent notice to the contrary) of one year upon the expiration of the initial term or any renewal term. Under the Matthew Ritter Employment Agreement, Mr. Ritter will be entitled to base compensation of $180,000 per year, incentive compensation based on Mr. Ritter’s performance as determined by the Company’s board of directors and awards of stock options pursuant to any plans or arrangements the Company may have in effect from time to time.

If Mr. Ritter is terminated without cause or he resigns with good reason, he will be entitled to receive severance, subject to his execution and non-revocation of a release of claims in favor of the Company and its officers, directors and affiliates, equal to any unpaid base salary, reimbursement for unpaid expenses and all other accrued payments or benefits through his termination date, plus the greater of: (1) his monthly base salary at the level in effect immediately prior to his termination date, multiplied by number of full or partial months, if any, in the period beginning on his termination date and ending on the date his initial employment term would have ended, if later than his termination date or (2) one-half of his annual base salary at the level in effect immediately prior to his termination date.

The Matthew Ritter Employment Agreement also includes a customary confidentiality covenant and one-year post-termination nonsolicitation and non-interference covenants. 

Michael Ritter Employment Agreement

On September 16, 2019, the Company entered into an executive employment agreement with Michael Ritter (the “Michael Ritter Employment Agreement”) pursuant to which Michael Ritter will serve as Senior Vice President of Operations of the Company. The Michael Ritter Employment Agreement provides for an initial term of four years, with automatic extensions (absent notice to the contrary) of one year upon the expiration of the initial term or any renewal term. Under the Michael Ritter Employment Agreement, Mr. Ritter will be entitled to base compensation of $180,000 per year, incentive compensation based on Mr. Ritter’s performance as determined by the Company’s board of directors and awards of stock options pursuant to any plans or arrangements the Company may have in effect from time to time.

If Mr. Ritter is terminated without cause or he resigns with good reason, he will be entitled to receive severance, subject to his execution and non-revocation of a release of claims in favor of the Company and its officers, directors and affiliates, equal to any unpaid base salary, reimbursement for unpaid expenses and all other accrued payments or benefits through his termination date, plus the greater of: (1) his monthly base salary at the level in effect immediately prior to his termination date, multiplied by number of full or partial months, if any, in the period beginning on his termination date and ending on the date his initial employment term would have ended, if later than his termination date or (2) one-half of his annual base salary at the level in effect immediately prior to his termination date.

The Michael Ritter Employment Agreement also includes a customary confidentiality covenant and one-year post-termination nonsolicitation and non-interference covenants.

The foregoing summary descriptions of the material terms of the Matthew Ritter Employment Agreement and the Michael Ritter Employment Agreement are not complete and are subject to and qualified in their entirety by reference to the text of the employment agreements, copies of which are filed herewith as Exhibit 10.1 and 10.2 and the terms of which are incorporated by reference.

Antara Capital Financing

On September 16, 2019, the Company entered into a $24.5 million financing agreement (the “Financing Agreement”) among the Company, each subsidiary of the Company, various lenders from time to time party thereto, and Cortland Capital Market Services LLC, as administrative agent and collateral agent (“Collateral Agent”). Pursuant to the Financing Agreement, the Company borrowed $22.4 million (the “Term Loan”) and has the ability to borrow up to an additional $2.1 million in the aggregate prior to October 31, 2019. All of the Company’s subsidiaries are guarantors under the Financing Agreement, and the Term Loan is secured by all assets of the Company and its subsidiaries, including pledges of all equity in the Company’s subsidiaries. The Company paid a 2% financing fee in connection with its entry into the Financing Agreement.

The Term Loan bears interest at 12% per annum, and has a maturity date of September 16, 2022. Until December 31, 2019, interest on the Term Loan will be paid in kind and capitalized as additional principal, and the Company has the option to pay interest on the capitalized interest in cash or in kind. After December 31, 2019, monthly interest payments will be due in cash, and all outstanding principal and interest will be due on the maturity date. The Term Loan may be prepaid at any time, subject to payment of a prepayment premium equal to (i) 7% of each prepayment made on or prior to September 16, 2020 and (ii) 5% of each prepayment made after September 16, 2020 but on or prior to September 16, 2021, with no premium due after September 16, 2021.

In the event of a default, the lenders have the right to terminate their obligations under the Financing Agreement and to accelerate the payment on any unpaid principal amount of all outstanding loans. As defined in the Financing Agreement, events of default include, but are not limited to: failure by the Company to pay any amount due under the Financing Agreement when due; failure by the Company to satisfy any financial covenant required under the Financing Agreement; and any representation or warranty made in connection with the Financing Agreement being materially false.

The foregoing summary description of the material terms of the Financing Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the Financing Agreement, which is filed as Exhibit 4.1 to this Current Report on Form 8-K and is incorporated herein by reference in its entirety.

Director Nomination Agreement

On September 16, 2019, and in connection with the Financing Agreement, the Company and Antara Capital Master Fund LP (“Antara Capital”) entered into a director nomination agreement (the “Nomination Agreement”) pursuant to which the Company agreed to permit Antara to designate one individual for election as a member of the Company’s board of directors and one individual to serve as an observer to the Company’s board of directors. Pursuant to the Nomination Agreement and until the termination of the Nomination Agreement, the Company has agreed not to take any action to increase the number of directors on the Company’s board of directors to more than eight directors without Antara Capital’s prior written consent. Until termination of the Nomination Agreement, the Company has also agreed, subject to certain exceptions, not to repurchase, exchange or redeem any common or preferred stock of the Company without approval of the Company’s board of directors and Antara Capital’s designated director. Unless earlier terminated by Antara Capital, the Nomination Agreement will terminate on the date of expiration of the then-current term of Antara Capital’s designated director that expires after the date when Antara Capital and its affiliates beneficially own shares of the Company’s common stock representing less than 15% of the shares of common stock issuable upon exercise of the warrants issued by the Company to Antara Capital described in Item 3.02 below.

The foregoing summary description of the material terms of the Nomination Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the Nomination Agreement, which is filed as Exhibit 10.3 to this Current Report on Form 8-K and is incorporated herein by reference in its entirety.

Side Letter Agreement

In connection with the Financing Agreement, on September 16, 2019, the Company and Antara Capital entered into a side letter agreement (the “Side Letter Agreement”) pursuant to which the Company agreed to issue a warrant to Antara Capital to purchase up to 1,500,000 shares of Company common stock (the “Side Letter Warrant Shares”) at an exercise price of $0.01 per share. If the Company completes the acquisition of certain Loadtrek assets (the “Loadtrek Acquisition”) within 90 days after the date of the Side Letter Agreement, then the number of Side Letter Warrant Shares will be reduced as follows: (i) if the value of the assets acquired in the Loadtrek Acquisition is greater than or equal to $3,750,000, the warrant will be canceled; and (ii) if the value is less than $3,750,000, the Side Letter Warrant Shares will be reduced by the amount by which the value of the assets is less than $3,750,000, divided by $2.50. If the Company completes the Loadtrek Acquisition more than 90 days after the date of the Side Letter Agreement but before September 30, 2021, then the number of Side Letter Warrant Shares will be reduced as follows: (i) if the value of the assets acquired in the Loadtrek Acquisition is greater than or equal to $3,750,000, the warrant will be canceled; and (ii) if the value is less than $3,750,000, the Side Letter Warrant Shares will be reduced to a number equal to 100,000 plus the amount by which the value of the assets is less than $3,750,000, divided by $2.50.

Notwithstanding whether the Company consummates the Loadtrek Acquisition or the value of the assets acquired, if applicable, the warrant to be issued pursuant to the Side Letter Agreement is subject to automatic cancellation if the Company meets its financial plan for two consecutive fiscal quarters during the period beginning with the first full fiscal quarter after the warrant is issued and ending on September 30, 2021. The warrant will become exercisable on September 30, 2021 if not previously canceled, and the Loadtrek Acquisition and its terms are subject to Antara Capital’s review and approval.

The foregoing summary description of the material terms of the Side Letter Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the Side Letter Agreement, which is filed as Exhibit 10.4 to this Current Report on Form 8-K and is incorporated herein by reference in its entirety.

Danny Cuzick Subordination Agreements

In connection with the Financing Agreement, on September 16, 2019 (i) the Company, Danny Cuzick, and the Collateral Agent entered into a subordination agreement (the “EVO Subordination Agreement”) and (ii) Environmental Alternative Fuels, LLC (“EAF”), Danny Cuzick, and the Collateral Agent entered into a subordination agreement (the “EAF Subordination Agreement” and together with the EVO Subordination Agreement, the “Subordination Agreements”). Pursuant to the Subordination Agreements, Danny Cuzick agreed to subordinate all obligations of EAF and the Company owed to him under certain loan documents between EAF and the Company, respectively, and Danny Cuzick. In addition, Danny Cuzick agreed not to receive, accept, or demand payment under the subordinated obligations until all obligations under the Financing Agreement have been paid in full, except that Danny Cuzick may continue to receive regularly scheduled interest payments so long as Collateral Agent has not delivered notice that an event of default has occurred and is continuing under the Financing Agreement.

The foregoing summary of the material terms of the Subordination Agreements is not complete and is qualified in its entirety by reference to the text of the Subordination Agreements, copies of which are filed herewith as Exhibits 10.5 and 10.6, the terms of which are incorporated herein by reference.

Peck and Lampsa Amendments

In connection with the Financing Agreement, on August 30, 2019, EVO Equipment Leasing, LLC (“EVO Equipment”) and John and Ursula Lampsa (collectively, the “Noteholder”) entered into an amendment (the “Lampsa Note Amendment”) to the promissory note payable by EVO Equipment to the order of the Noteholder in the original principal amount of $6,430,000. The Lampsa Note Amendment extended the maturity date of the note to November 30, 2022. In addition, on August 30, 2019, the Company and Billy (Trey) Peck Jr. (“Peck”) entered into an amendment (the “EPA Amendment”) to the equity purchase agreement between the Company and Peck dated June 1, 2018 (as subsequently amended, the “EPA”). The EPA Amendment extended the maturity date of the payments due to Peck under the EPA to November 30, 2022. As consideration for the EPA Amendment, the Company paid Peck an extension fee of $150,000, which fee will be credited to the balance owed to Peck under the EPA. The Company also agreed to pay Peck an additional $50,000 on January 31, 2020 if the Company meets certain financial goals in the fourth fiscal quarter of 2019, which additional fee, if paid, will also be credited to the balance owed to Peck under the EPA.

The foregoing summary description of the material terms of the Lampsa Note Amendment and the EPA Amendment does not purport to be complete and is qualified in its entirety by reference to the full text of the Lampsa Note Amendment and the EPA Amendment, which are filed as Exhibits 10.7 and 10.8 to this Current Report on Form 8-K and are incorporated herein by reference in their entirety.

Antara Capital Warrants

In connection with the Financing Agreement, on September 16, 2019, the Company issued two warrants (the “$0.01 Warrant” and the “$2.50 Warrant” and collectively, the “Antara Warrants”) to Antara Capital to purchase an aggregate of 4,240,000 shares of common stock of the Company (the “Antara Warrant Shares”). The $0.01 Warrant grants Antara Capital the right to purchase up to 3,350,000 Antara Warrant Shares at an exercise price of $0.01 per share and is exercisable for five years from the date of issuance. If the fair market value (as defined in the $0.01 Warrant) of the Antara Warrant Shares is greater than $0.01 at the end of the exercise period, then the $0.01 Warrant will be automatically deemed to be exercised immediately prior to the end of the exercise period. The $2.50 Warrant grants Antara Capital the right to purchase up to 890,000 Antara Warrant Shares at an exercise price of $2.50 per share, subject to adjustment for certain distributions, stock splits, and issuances of common stock, and is exercisable for ten years from the date of issuance. If the fair market value (as defined in the $2.50 Warrant) of the Antara Warrant Shares is greater than $2.50 at the end of the exercise period, then the $2.50 Warrant will be automatically deemed to be exercised immediately prior to the end of the exercise period. Pursuant to the Antara Warrants, the Company granted Antara Capital preemptive rights to purchase its pro rata share, determined based on the number of shares held by Antara Capital or into which the Antara Warrants are exercisable, of capital stock issued by the Company after the issuance date of the Antara Warrants, subject to certain excepted issuances.

The Antara Warrants and Antara Warrant Shares were offered and sold as part of a private placement solely to “accredited investors” as that term is defined under Rule 501(a) under the Securities Act of 1933, as amended (the “Securities Act”), pursuant to exemptions from the registration requirements of the Securities Act afforded by Section 4(a)(2) of the Securities Act.

The foregoing summary of the material terms of the Antara Warrants is not complete and is qualified in its entirety by reference to the text of the Antara Warrants, copies of which are filed herewith as Exhibits 10.9 and 10.10, the terms of which are incorporated herein by reference.

Danny Cuzick Warrant

In connection with the Financing Agreement and as consideration for Danny Cuzick’s entry into the Subordination Agreements, on September 16, 2019, the Company issued a warrant (the “Cuzick Warrant”) to Danny Cuzick to purchase an aggregate of 350,000 shares of common stock of the Company (the “Cuzick Warrant Shares”) at an exercise price of $0.01 per share. The Cuzick Warrant is exercisable for five years from the date of issuance. If the fair market value (as defined in the Cuzick Warrant) of the Cuzick Warrant Shares is greater than $0.01 at the end of the exercise period, then the Cuzick Warrant will be automatically deemed to be exercised immediately prior to the end of the exercise period. Pursuant to the Cuzick Warrant, the Company granted Danny Cuzick preemptive rights to purchase his pro rata share, determined based on the number of shares held by Danny Cuzick or into which the Cuzick Warrant is exercisable, of capital stock issued by the Company after the issuance date of the Cuzick Warrant, subject to certain excepted issuances.

The Cuzick Warrant and Cuzick Warrant Shares were offered and sold as part of a private placement solely to “accredited investors” as that term is defined under Rule 501(a) under the Securities Act of 1933, as amended (the “Securities Act”), pursuant to exemptions from the registration requirements of the Securities Act afforded by Section 4(a)(2) of the Securities Act.

The foregoing summary of the material terms of the Cuzick Warrant is not complete and is qualified in its entirety by reference to the text of the Cuzick Warrant, a copy of which is filed herewith as Exhibit 10.11, the terms of which are incorporated herein by reference.

Ritter Share Issuances

As consideration for the Acquired Interests and pursuant to a subscription agreement with Michael Ritter and Matthew Ritter, on September 16, 2019, the Company issued 1,220,491 shares of common stock, par value $0.0001 per share, to each of Michael Ritter and Matthew Ritter. The issuance of common stock was made in reliance on the exemption from registration provided by Section 4(a)(2) of the Securities Act, because the issuance did not involve a public offering, the recipients took the shares for investment and not resale and the Company took appropriate measures to restrict transfer. The Company did not pay underwriter discounts or commissions in connection with the foregoing transaction.

The foregoing summary description of the material terms of the subscription agreement is not complete and is subject to and qualified in its entirety by reference to the text of the subscription agreement, a copy of which is filed herewith as Exhibit 10.12 and the terms of which are incorporated by reference.

* Schedules have been omitted pursuant to Item 601(b)(2) of Regulation S-K. The Company hereby agrees to furnish supplementally a copy of any of the omitted schedules upon request by the U.S. Securities and Exchange Commission.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

7

Exhibit 2.1

Stock EXCHANGE AGREEMENT

This Stock Exchange Agreement (this “Agreement”) is made effective as of September 16, 2019, by and among EVO Holding Company, LLC, a Delaware limited liability company (“Buyer”), EVO Transportation & Energy Services, Inc., a Delaware corporation (“Parent”), and the stockholders listed on Exhibit A hereto (each, individual, a “Seller” and, collectively, the “Sellers”). Buyer, Parent and the Sellers may be referred to individually in this Agreement as a “Party” and collectively as the “Parties.” Capitalized Terms used herein and not otherwise defined have the meanings given to such terms in Exhibit B attached hereto. Parent joins this Agreement solely to guaranty (a) the issuance of the Common Stock, (b) the payment of any indemnification obligations of Buyer, and (c) the performance by Buyer of Buyer’s covenants set forth in this Agreement.

RECITALS

A.   The Sellers own all of the issued and outstanding equity interests (collectively, the “Equity Interests”) of John W. Ritter, Inc. (the “Company”).

B. The Company is engaged in the business of fulfilling government contracts for freight trucking services as well as providing freight trucking services to non-government entities (the “Business”).

C. The Parties desire to enter into this Agreement whereby the Sellers propose to sell to Buyer, and Buyer proposes to purchase from the Sellers, all of the Equity Interests, such that Buyer will become the sole equity owner of the Company.

D.   Each Seller will receive substantial financial benefit from the transaction set forth in this Agreement and understand that being parties to certain sections of this Agreement (including Section 3.5) is a condition to Buyer entering into this Agreement.

AGREEMENTS

In consideration of the representations, warranties, covenants, agreements, and conditions set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereby agree as follows:

Article I - SALE AND PURCHASE OF THE EQUITY INTERESTS

1.1   Exchange of Equity Interests. Subject to the terms and conditions set forth herein, at the Closing, each Seller shall sell and deliver to Buyer, and Buyer shall purchase from each Seller, the Equity Interests set forth next to such Seller’s name on Exhibit A, free and clear of all Liens, for the consideration specified in Section 1.2.

1.2   Purchase Price. The aggregate purchase price to be paid by Buyer to the Sellers (the “Purchase Price”) will be Six Million One Hundred Two Thousand Four Hundred Fifty Three Dollars and Zero Cents ($6,102,453.00) to be paid by delivery of such number of shares of Buyer’s common stock, par value $0.0001 per share (the “Common Stock”), as shall be determined by dividing such dollar amount by the greater of (i) $2.50 per share or (ii) 80% of the most recently reported trading price for the Common Stock on the OTC Marketplace. In addition, Buyer will pay off aggregate Indebtedness of the Company in the amount of Three Million Twenty-One Thousand Four Hundred Fifty-Four Dollars and Sixty-Three Cents ($3,021,454.63) in principal and accrued interest as of the Closing, as specifically set forth on Schedule 1.2.

1.3   Allocation of Purchase Price. The aggregate Purchase Price payable to the Sellers will be allocated among and paid to the Sellers as set forth on Exhibit A hereto.

Article II - CLOSING MATTERS

2.1   Closing. The closing of the purchase and sale of the Equity Interests contemplated by this Agreement (the “Closing”) will take place concurrently with the signing of this Agreement by exchanging faxed or e-mailed copies of signed documents. The date of the Closing is the “Closing Date” and the Closing will be deemed effective as of 11:59 p.m. local time on September ___, 2019 (the “Effective Time”).

2.2   Conditions to Buyer’s Obligations. The obligation of Buyer to consummate the transactions contemplated by this Agreement on the Closing Date is subject to the satisfaction of each of the following conditions:

(a) Consents. The Sellers will have obtained and delivered to Buyer all required third party consents, including the consents set forth on Schedule 2.2(a).

(b) Release of Liens. The Sellers will have obtained releases of all Liens, other than the Liens set forth on Schedule 2.2(b), on the assets of the Company and the Equity Interests. The Sellers will have delivered such payoff letters, discharges of Liens, releases of guarantees and other releases as are reasonably requested by Buyer at or prior to Closing.

(c) Closing Documents. At the Closing, the Sellers will have delivered, or will have caused to be delivered, to Buyer, all of the following documents:

(i) a certificate from the Secretary of the Company certifying the Organizational Documents of the Company;

(ii) a Certificate of Good Standing for the Company from the applicable Secretary of State;

(iii) the leases, in the form attached hereto as Exhibits C-1, C-2, and C-3, each executed by the landlord party thereto (collectively, the “Restated Leases”);

(iv) employment agreements, in the form attached hereto as Exhibit D, executed by Matthew Ritter and Michael Ritter, respectively (the “Employment Agreements”);

(v) subscription agreements, in the form attached hereto as Exhibit E, executed by each Seller, respectively (the “Subscription Agreements”);

(vi) certificates or other documents representing the Equity Interests, as well as such stock powers or similar transfer documentation as shall be reasonably requested by Buyer;

(vii) written resignations of the officers and members of the board of directors of the Company, each duly executed by the appropriate parties;

(viii) the original record and minute books, equity ledgers and registers, and company seals, if any, of the Company;

(ix) a certificate of non-foreign status of the Sellers meeting the requirements of Treasury Regulation Section 1.1445-2(b)(2);

(x) such other documents relating to the transactions contemplated by this Agreement as Buyer may reasonably request prior to Closing.

2.3   Conditions to the Sellers’ Obligations. The obligation of the Sellers to consummate the transactions contemplated by this Agreement on the Closing Date is subject to Buyer’s delivery to the Sellers copies of the following:

(i) resolutions duly adopted by Buyer’s board of directors authorizing the execution, delivery and performance of this Agreement,

(ii)  the Restated Leases executed by Buyer;

(iii) the Employment Agreements executed by Buyer;

(iv) the Subscription Agreements countersigned by Buyer;

(v) issuance of the shares of Common Stock of Buyer to each Seller, as shown on Exhibit A; and

(vi) all other agreements or instruments contemplated hereby and the consummation of the transactions contemplated hereby.

Article III - COVENANTS

3.1   Sales and Transfer Taxes. All sales, use, excise, value-added, goods and services, transfer, recording, documentary, registration, conveyancing and similar Taxes that may be incurred in connection with this Agreement, together with any and all penalties, interest, and additions to Tax with respect thereto will be paid by Buyer.

3.2   Further Assurances. In case at any time after the Closing any further action is necessary to carry out the purposes of this Agreement, each of the Parties will take such further action (including the execution and delivery of such further instruments and documents) as any other Party reasonably may request, all at the cost and expense of the requesting Party.

3.3   Administration of Accounts. All payments and reimbursements received by the Sellers or any entity controlled by Sellers after the Closing Date from any third party in the name of the Company will be held by the Sellers or such entity in trust for the benefit of Buyer. Immediately upon receipt of such payment or reimbursement, the Sellers will pay to Buyer the amount of such payment or reimbursement without right of set-off, offset, or reduction of any kind.

3.4   Confidentiality. Each Seller agrees that Seller will not use, or permit the use of, any of the information relating to the Business, or relating to Buyer or Buyer’s Affiliates, furnished to such Seller in connection with the transactions contemplated herein (“Information”) in a manner or for a purpose detrimental to Buyer or Buyer’s Affiliates, or otherwise than in connection with the transaction, and that it will not disclose, divulge, provide or make accessible (collectively, “Disclose” or “Disclosure”), or permit any other Person to Disclose, any of the Information to any individual or entity, other than its investment advisors, accountants, counsel and other authorized representatives and agents, except as may be required by judicial or administrative process or, in the opinion of his counsel, by other requirements of Law; provided, however, that prior to any Disclosure of any Information permitted hereunder, the Sellers will first obtain the recipients’ undertaking to comply with the provisions of this Section 3.4 with respect to such Information.

3.5   Non-Competition; Non-Solicitation; Non-Hire. As additional consideration for Buyer’s entry into this Agreement and consummation of the transactions contemplated hereby, and with the acknowledgement by the Sellers that Buyer would not enter into this Agreement without the benefit of the provisions set forth in this Section 3.5, each Seller agrees that the following restrictions on such Seller’s activities following the Closing Date are necessary, appropriate and reasonable to protect the Business and other legitimate interests of Buyer and its Affiliates:

(a) Non-Competition. For a period of five (5) years immediately following the Closing Date (the “Restricted Period”), each Seller agrees that such Seller will not, anywhere in the U.S., directly or indirectly, on behalf of any Person other than Buyer or its Affiliates, invest in, own, manage, operate, finance, control, advise, render services as an employee, independent contractor, or otherwise, or guarantee the obligations of any Person engaged in or planning to become engaged in the Business, or any business engaged in by Buyer or its Affiliates; provided, however, that the ownership of less than two percent (2%) of the outstanding stock of any publicly traded company will not by itself be deemed to be a violation of this provision

(b) Non-Solicitation. During the Restricted Period, each Seller will not, directly or indirectly, solicit the business of any Person who is a customer of the Business, or of Buyer or its Affiliates, or cause, induce, or attempt to cause or induce, any customer, supplier, licensee, licensor, franchisee, employee, consultant or other business relation of Buyer or its Affiliates to cease doing business with such parties, to deal with any competitor of Buyer or its Affiliates, or in any way interfere with its relationship with such parties, all of the foregoing as it relates to the Business.

(c) Non-Hire. During the Restricted Period, each Seller will not, directly or indirectly, on behalf of any Person other than Buyer or its Affiliates, solicit, hire or engage in any capacity any employee of Buyer or its Affiliates (or any person or entity who was an employee of Buyer or its Affiliates within 12 months of the date such hiring or engagement occurs) or solicit or seek to persuade any employee of Buyer or its Affiliates to discontinue such employment.

(d) Modification of Covenant. If a final judgment of a court or tribunal of competent jurisdiction determines that any term or provision contained in this Section 3.5 is invalid or unenforceable, then the Parties agree that the court or tribunal will have the power to reduce the scope, duration or geographic area of the term or provision, to delete specific words or phrases or to replace any invalid or unenforceable term or provision with a term or provision that is valid and enforceable and that comes closest to expressing the intention of the invalid or unenforceable term or provision. This Section 3.5 will be enforceable as so modified.

(e) Enforcement of Covenant. The Parties agree that the remedy of damages at law for the breach of any of the covenants contained in this Section 3.5 is an inadequate remedy. In recognition of the irreparable harm that a violation by the Sellers of any of the covenants, agreements or obligations arising under this Section 3.5 would cause Buyer or its Affiliates, the Sellers agree that in addition to any other remedies or relief afforded by law, a preliminary and permanent injunction against an actual or threatened violation or violations may be issued against the Sellers without showing actual monetary damages or posting of a bond or other security. In the event of an action to enforce the covenants in this Section 3.5, the prevailing Party will be entitled to be reimbursed by the other Party for reasonable attorney’s fees and other expenses incurred by the prevailing Party with respect to such enforcement action; provided, however, Buyer will be entitled to be reimbursed by the Sellers in the event a Seller challenges the enforceability or reasonableness of any of the provisions of this Section 3.5. Each of Buyer’s Affiliates will have the right to enforce the Sellers’s obligations set forth in this Section 3.5. In addition, in the event any Seller violates any provisions of this Section 3.5, then, in such event the period of the violation will be added to the Restricted Period set forth in such section.

3.6   Certain Tax Matters.

(a) Tax Returns. The Sellers will prepare, or cause to be prepared, and file, or cause to be timely filed, all Tax Returns for the Companies for all Tax periods ending on or prior to the Closing Date (such Tax Returns constituting the “Pre-Closing Tax Returns”). The Sellers will timely pay all Taxes due with respect to all Pre-Closing Tax Returns. The Sellers will provide any unfiled Pre-Closing Tax Returns to Buyer for review at least ten (10) Business Days prior to filing, and the Sellers will reflect any reasonable comments made by Buyer on such Tax Returns. Notwithstanding the foregoing, the Sellers will not cause the Companies to extend or amend any Tax Returns with respect to any Tax period ending on or prior to the Closing Date without the prior written consent of Buyer. Buyer will prepare and timely file, or cause to be prepared and timely filed, all Tax Returns required to be filed by the Companies for all Tax periods beginning after the Closing Date. Buyer will timely pay all Taxes due with respect to all Tax periods beginning after the Closing Date, except that Sellers shall be responsible for that portion of any Taxes due for a Straddle Period as provided in Section 3.6(b).

(b) Straddle Period. In the case of any taxable period that includes (but does not end on) the Closing Date (a “Straddle Period”), (i) the amount of any Taxes based on or measured by income, gain, payroll or receipts of the Company for the Pre-Closing Tax Period will be determined based on an interim closing of the books as of the close of business on the Closing Date (with any net operating losses being first applied to the interim period ending on the Closing Date (to the extent available under applicable Law) and, therefore, first inuring to the benefit of the Sellers); and (ii) the amount of other Taxes of the Company for a Straddle Period that relates to the Pre-Closing Tax Period will be deemed to be the amount of such Tax for the entire taxable 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. The Sellers will timely pay all Taxes relating to that portion of the Straddle Period up to and including the Closing Date. Buyer will timely pay all Taxes relating to that portion of the Straddle Period after the Closing Date. If any Tax is due from the Sellers with respect to the portion of the Straddle Period ending on the Closing Date, the Sellers shall be provided with a copy of the applicable Tax Return and Buyer’s calculation and documentation of the Sellers’ portion of the Tax due. Buyer will prepare and timely file, or cause to be prepared and timely filed, all Tax Returns required to be filed by the Company for any Straddle Period.

(c) Cooperation; Audit. After the Closing Date, Buyer and the Sellers will, and will cause their respective Affiliates to, cooperate in the preparation of all Tax Returns of the Company and will provide, or cause to be provided, to the requesting Party any records or other information requested by such Party in connection therewith. The Sellers, on the one hand, and Buyer, on the other hand, will give prompt notice to each other of any proposed adjustment to Taxes for the Pre-Closing Tax Period or the Straddle Period. Promptly upon receipt by either Party of any notification or indication (whether written or oral) from any taxing authority that it intends to investigate or audit any Tax Return of the Company for any Tax period ending on or prior to the Closing Date, the Party receiving such information will notify the other Party and convey such information to the other Party in writing. Each Party will cooperate with the other in connection with any Tax investigation, Tax audit, or other Tax proceeding; provided, however, Buyer will be entitled to represent the Company on any Tax investigation, Tax audit, or other Tax proceeding that arises after the Closing Date provided Buyer will allow the Sellers to reasonably participate at the Sellers’ own cost and expense to the extent such matter could reasonably result in an indemnification claim against the Sellers pursuant to this Agreement. A Party will be reimbursed for reasonable out-of-pocket expenses incurred in taking any action reasonably requested by the other Party or Parties under this Section 3.6(c); provided, however, that the foregoing will not alter any indemnification rights to which the Parties are entitled under this Agreement.

3.7   Release by Sellers. Effective as of the Closing, in consideration of the mutual covenants and agreements contained herein, including the consideration to be received by the Sellers, each Seller hereby irrevocably releases and forever discharges the Company and Buyer, and their respective Affiliates, officers, managers, directors, members, partners (general or limited), agents, and employees, and the successors, heirs, assigns, executors and administrators to the foregoing (collectively, the “Released Parties”), of and from any and all manner or causes of action and actions, claims, suits, rights, debts, sums of money, covenants, contracts, damages and judgments whatsoever, in law or in equity, which the Sellers ever had, now has or which the Sellers can, shall or may have, against the Released Parties, whether known or unknown, suspected or unsuspected, matured or unmatured, fixed or contingent, for, upon or by reason of any matter relating to the Company or its Affiliates, and arising at any time on or prior to the Closing Date, whether in the Seller’s capacity as an equity holder, director, manager, officer, employee, holder of Indebtedness or otherwise, and the Released Parties shall not have liability with respect thereto, provided, however, that such release shall not will not apply to obligations owing to the Sellers arising pursuant to the Transaction Documents.

3.8  Release by Companies. Effective as of the Closing, in consideration of the mutual covenants and agreements contained herein, each of the Released Parties hereby irrevocably releases and forever discharges each Seller, and their respective Affiliates, partners (general or limited), agents, and employees, and the successors, heirs, assigns, executors and administrators to the foregoing (collectively, the “Seller Released Parties”), of and from any and all manner or causes of action and actions, claims, suits, rights, debts, sums of money, covenants, contracts, damages and judgments whatsoever, in law or in equity, which the Released Parties ever had, now has or which the Released Parties can, shall or may have, against the Seller Released Parties, whether known or unknown, suspected or unsuspected, matured or unmatured, fixed or contingent, for, upon or by reason of any matter relating to the Company or its Affiliates, and arising at any time on or prior to the Closing Date.

3.9  D&O Claims. Notwithstanding anything herein to the contrary elsewhere in this Agreement, each Seller hereby agrees that he will not make any claim for indemnification against Buyer, Buyer Indemnified Parties, or the Company by reason of the fact that he was a controlling person, manager, director, officer, or representative of the Company.

Article IV - REPRESENTATIONS AND WARRANTIES OF THE Sellers

The Sellers jointly and severally represent and warrant to Buyer that the statements contained in this Article IV are true and correct as of the date hereof except as set forth in the corresponding schedule of the disclosure schedules attached hereto (the “Disclosure Schedules”).

4.1   Organization and Qualification. The Company is a duly organized, validly existing corporation in good standing under the Laws of the state of its incorporation. The Company has all the requisite power, authority, and capacity to own, lease, and operate its assets and to carry on the Business as the same was and is now being conducted. The Company is qualified to transact business as a foreign entity and is in good standing under the Laws of each jurisdiction in which the nature of its business or the ownership or leasing of its properties requires such qualification, except where the failure to so qualify has not and would not reasonably be expected to have a Material Adverse Effect on the Company. The Sellers have heretofore delivered to Buyer complete and correct copies of the Company’s Organizational Documents now in effect, and the Company is not in default under or in violation of any provision of its Organizational Documents.

4.2 Power and Authority; Enforceability. The Sellers have all power and authority to enter into and consummate the transactions contemplated by this Agreement and any ancillary agreements (the “Transaction Documents”) to which they are a party. The execution and delivery of the Transaction Documents by the Sellers and the consummation of the transactions contemplated by the Transaction Documents to which the Sellers are a party have been duly authorized by all necessary action on the part of each Seller. The Transaction Documents have been duly executed and delivered by the Sellers, and such Transaction Documents constitute the legal, valid and binding obligations of each Seller, enforceable against each Seller in accordance with their respective terms, except to the extent that (a) their enforceability may be limited by applicable bankruptcy, insolvency, reorganization, or other Laws affecting the enforcement of creditor’s rights generally, and (b) the availability of equitable remedies is subject to the discretion of the court before which any such proceeding may be brought.

4.3  No Conflict. Neither the execution and delivery of this Agreement nor the performance of the provisions hereof or the transactions contemplated hereby: (a) violate or conflict with the Company’s Organizational Documents; (b) violate or conflict with any Law, rule, regulation, writ, judgment, injunction, decree, determination, award or other order of any court, government or governmental agency or instrumentality, domestic or foreign, that is applicable to the Company; or (c) will result in a breach of any of the terms or conditions of, or constitute a default under, any mortgage, note, bond, indenture, agreement, license or other instrument or obligation to which the Company or any Seller is a party or by which any of their respective properties or assets may be bound or affected. Except as set forth on Schedule 4.3, the execution, delivery and performance of this Agreement and the consummation of the transactions contemplated hereby do not require any material authorization, consent, approval, exemption or other material action by or notice to any Governmental Entity or other third party, under any Material Contract or Governmental Contract to which the Company is bound, or any law, statute, rule or regulation or order, judgment or decree to which the Company is subject.

4.4 Capitalization. The capitalization of the Company is as set forth on Schedule 4.4. The Equity Interests set forth on Schedule 4.4 constitute all of the outstanding Equity Interests of the Company and are validly issued, fully paid and non-assessable. There are (i) no outstanding subscriptions, options, calls, Contracts, commitments, understandings, restrictions, arrangements, rights or warrants, including any rights plan, and any right of conversion or exchange under any outstanding security, instrument or other agreement, obligating any Company to issue, deliver or sell, or cause to be issued, delivered or sold, additional equity interests of any Company, respectively, or obligating the Company to grant, extend or enter into any such agreement or commitment, and (ii) no voting trusts, proxies or other agreements or understandings to which the Company or the Sellers are a party or are bound with respect to the voting of any of the Equity Interests of the Company. Each Seller has good and valid title to and beneficial ownership in the Equity Interests set forth on Schedule 4.4 and such Equity Interests are free and clear of all Liens. Except as set forth on Schedule 4.4, the Company has no equity interest in any direct or indirect subsidiary.

4.5   Financial Statements; Undisclosed Liabilities and Defaults.

(a) The Company has delivered to Buyer the unaudited balance sheets of the Company as of December 31, 2018 and December 31, 2017 and the related statements of income, stockholders’ equity and cash flows for the fiscal years then ended. All of the foregoing financial statements are collectively referred to herein as the “Financial Statements.” The Financial Statements have been prepared in accordance with GAAP and fairly present, in all material respects, the financial condition and results of operation of the Company at the dates and for the periods indicated therein, except as otherwise may be indicated therein. The Company’s accounting practices have been consistently applied for all periods represented by the Financial Statements, except as otherwise may be indicated therein.

(b) The Company’s books of account and financial records are true and correct in all material respects and have been prepared and are maintained in accordance with sound accounting practice. The Financial Statements have been prepared and presented based upon and in conformity with such books of account and financial records.

(c) Except as set forth on Schedule 4.5(c) or as and to the extent adequately accrued or reserved against in the unaudited balance sheet of the Company as of December 31, 2018, the Company does not have any Liability, Indebtedness or obligation which would be required by GAAP to be reflected in a balance sheet of the Company prepared in accordance with GAAP or disclosed in the notes thereto, except for liabilities and obligations, incurred in the ordinary course of business consistent with past practice since December 31, 2018.

4.6   Intentionally Omitted.

4.7   Compliance with Laws.

(a) The Company is in compliance in all material respects with all applicable Laws with respect to the Business.

(b) The Company holds all material permits, approvals, registrations, franchises, licenses, certificates, accreditations and other authorizations of all Governmental Entities (the “Permits”) required for the conduct of the Business and all such Permits are set forth on Schedule 4.7. The Company has complied with and is in compliance with the terms and conditions of such Permits in all material respects. The Company has not received any notices that it is in material violation of any of the terms or conditions of such Permits. The Company has taken all reasonable action to maintain such Permits. No loss or expiration of any such Permit is pending or threatened other than expiration in accordance with the terms thereof. Except as set forth on Schedule 4.7, the Permits owned or used by the Company immediately prior to the Closing will be available for use by Buyer on the same terms and conditions immediately subsequent to the Closing.

4.8   Claims. Except as set forth on Schedule 4.8 and except for claims covered by insurance or otherwise made in the ordinary course of business, there are no claims, actions, suits, inquiries, proceedings (including any arbitration proceedings), judgments, orders, awards, decrees, or investigations, pending or, to the Knowledge of the Company, threatened against the Company or any officer, director or employee thereof, or any Seller, in each case relating to the Business.

4.9   Title to Assets; Sufficiency. Except as set forth on Schedule 4.9, the Company holds good and marketable title to all of its property and assets, free and clear of any Liens, except Permitted Liens. No Person other than the Company has any right or interest in the assets of the Company, including the right to grant interests in the assets to third parties. The assets owned or leased by the Company are all those assets necessary to conduct the Business as presently conducted and will allow Buyer to continue to operate the Business in substantially the same manner immediately following the Closing Date. The equipment, machinery, fixtures, vehicles, computer hardware and furniture owned, leased or used by the Company is in good repair and operating condition (subject to ordinary wear and tear), and is suitable for the purposes for which it is used, and has been maintained in all material respects in accordance with the applicable manufacturer’s suggested maintenance procedures. All accounts and notes receivable of the Company represent amounts receivable for goods actually delivered or services actually provided (or in the case of notes and non-trade receivables, represent amounts in respect of other bona fide business transactions), to the Knowledge of the Company, are not subject to any defenses, counterclaims or rights of set off, have been billed and are generally due and payable within 30 days after billing, and subject to reasonable write-offs consistent with the prior experience of the company, will be fully collectible in the Ordinary Course of Business.

4.10   Indebtedness and Guarantees. Except as set forth on Schedule 4.10, the Company has no Indebtedness, and the Company does not guarantee the Indebtedness of any third party. Schedule 4.10 accurately states the outstanding balance of all Indebtedness as of the Closing Date. The sale of the Equity Interests pursuant to this Agreement is made in exchange for fair and equivalent consideration. The transactions contemplated by this Agreement and the agreements referenced in this Agreement will not give rise to any right of any creditor of the Company to accelerate the due date or alter the repayment terms of any Indebtedness of the Company. The transactions contemplated in this Agreement or any agreements referenced in this Agreement will not give rise to any right of any creditor of the Sellers whatsoever against Buyer or to any of the Equity Interests in the hands of Buyer after the Closing.

4.11   Material Contracts. Schedule 4.11 contains a complete and accurate list of all Material Contracts to which the Company is a party. Except as set forth on Schedule 4.11, (a) the Company has performed in all material respects the obligations required to be performed by it to date under its Material Contracts, and, (b) to the Knowledge of the Sellers there are no defaults by any other party thereto, and, (c) to the Knowledge of the Sellers, no event has occurred (or failed to occur) that, with the passing of time or the giving of notice or both would constitute a default by the Company under any such Material Contract, including the consummation of the transactions contemplated by this Agreement and no permission, waiver or approval is required to be obtained from any third party in order to preserve for Buyer the benefits of the Material Contracts after the consummation of the transaction contemplated by this Agreement. Each Material Contract is in full force and effect and constitutes a legal, valid, binding agreement of the Company except to the extent that such enforcement may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or other similar laws now or hereafter in effect relating to creditors’ rights generally, and except that the remedy of specific performance and injunctive and other forms of equitable relief may be subject to equitable defenses and to the discretion of the court before which any proceeding therefor may be brought. Buyer has been supplied with, or been provided access to, a true and correct copy of all written Material Contracts and true and correct written summaries of all oral Material Contracts.

4.12   Government Contracts and Government Bids.

(a) Schedule 4.12 contains a complete and accurate list of each Government Contract the period of performance of which has not yet expired or been terminated (each, a “Current Government Contract”). The Company has delivered to or provided Buyer access to complete and correct copies of each Current Government Contract. Each Current Government Contract was legally awarded to the Company. Each Current Government Contract is valid, binding and in full force and effect and enforceable against the Company in accordance with its terms except to the extent that such enforcement may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or other similar laws now or hereafter in effect relating to creditors’ rights generally, and except that the remedy of specific performance and injunctive and other forms of equitable relief may be subject to equitable defenses and to the discretion of the court before which any proceeding therefor may be brought.

(b) (i) The Company is not in material breach of or default under any Current Government Contract, and, to the Knowledge of the Company, no event has occurred which, with the giving of notice or the lapse of time or both, would constitute such a breach or default by the Company; (ii) the Company is in compliance in all material respects with the Federal Acquisition Regulation (“FAR”), Cost Accounting Standards, Service Contract Act of 1963, as amended (including requirements for paying applicable Service Contract Act wage rate and fringe benefit rates), the Truth in Negotiations Act, and the Anti-Kickback Act, in each case where and as applicable to each Current Government Contract or Government Bid; (iii) since January 1, 2016, each representation and certification made by the Company in connection with a Government Contract or Government Bid was current, accurate and complete in all material respects as of its effective date, and the Company has complied in all material respects with the terms of all Government Contracts; (iv) there are no outstanding or pending claims, requests for equitable adjustment or contract disputes in excess of $100,000 arising under or relating to a Government Contract or Government Bid; and (v) no Current Government Contract or Government Bid is currently the subject of any bid protest before any Governmental Entity.

(c) Since January 1, 2016, (i) neither the Company nor any Seller (as defined in FAR 52.209-5) has been debarred, suspended or excluded from participation in, or the award of, Government Contracts or doing business with any Governmental Entity, no suspension, debarment, or exclusion action has been commenced or threatened against the Company or any of its officers or employees, and there exist no circumstances that require the Company to answer any of the questions in FAR 52.209-5 in the affirmative; (ii) no Governmental Entity under a Government Contract has notified the Company of any breach or violation of any applicable Law or of any certification, representation, clause, provision or requirement of any such Government Contract; (iii) the Company has not received any notice of termination for default, cure notice or show cause notice pertaining to any Government Contract; (iv) the Company has not received any notice of an unresolved significant weakness or deficiency with respect to the cost accounting system of the Company; (v) the Company has not received written notice from any Governmental Entity or other counterparty to a Government Contract that the counterparty to such Government Contract (A) has ceased or will cease to be a customer of the Company, (B) intends to terminate or materially modify (including by materially decreasing the rate or amount of services obtained from the Company) any Government Contract, (C) intends to change the type of contracting vehicle for the services provided pursuant to such Government Contract in a manner that may preclude the Company from continuing to provide such services or (D) seeks to convert any Government Contract that establishes an exclusive or single source purchasing arrangement or relationship between such counterparty and the Company into a non-exclusive or multi-source arrangement or relationship; and (vi) the Company has not made any voluntary or mandatory disclosures to any Governmental Entity with respect to any material misstatement, significant overpayment or violation of applicable Law arising under or relating to any Government Contract or Government Bid, nor has any violation occurred for which the Company is required to make any such disclosure to a Governmental Entity.

(d) Since January 1, 2016, the Company has not been the subject or target of any audit, subpoena, investigation, prosecution or administrative proceeding related to any Government Contract or Government Bid. Since January 1, 2016, the Company has not received any written or oral notice of any pending or threatened audit, subpoena, investigation, prosecution or administrative proceeding related to any Government Contract or Government Bid.

4.13   Insurance. The Company is currently insured by insurers unaffiliated with the Company with respect to its properties, its assets and the operation of the Business in such amounts and against such risks as are appropriate and customary for the type of business conducted by the Company with customary deductibles and retained amounts and which insurance policies are set forth on Schedule 4.13. In addition, to the Knowledge of the Sellers, the Company has maintained adequate insurance for all prior periods with respect to the Business. With respect to each insurance policy held by the Company (a) the policy is legal, valid, binding and in full force and effect; and (b) the Company is not in default under any insurance policy held by the Company. The Company is not in default under any insurance policy held by the Company. All premiums under such insurance policies which are due and payable have been paid in full and the Company has not received notice of any material increase in the premium under, or the cancellation or non-renewal of, any such policy.

4.14   Intellectual Property. Set forth on Schedule 4.14 is a list and brief description of patents, patent rights, patent applications, trademarks, trademark applications and registrations, trade dress, proprietary rights, service marks, service mark applications, trade names, social media accounts and registrations, domain names and copyrights owned by or registered in the name of the Company and used in the Business, or, except with respect to commercially available off-the-shelf software (“COTS”), of which the Company is a licensor or licensee or in which the Company has any right, and in each case a brief description of the nature of such right. Except for payments made for the license of COTS, the Company is not subject to any obligation, including any license or royalty obligation, relating to any product or service of the Business that the Company now markets or has marketed in the three past years. Except as set forth on Schedule 4.14, the Company owns all rights in, or possesses adequate licenses or other rights to use, all patents, patent applications, trademarks, trademark applications and registrations, trade dress, service marks, service mark applications and registrations, proprietary rights, trade names, social media accounts and registrations, domain names, copyrights, manufacturing processes, batch tickets, designs, website content, formulae, technology, molds, trade secrets and know how necessary to conduct the Business as conducted prior to Closing (collectively, “Intellectual Property”). To the Knowledge of the Sellers, the Intellectual Property does not infringe or conflict upon the right of any third party, and to the Knowledge of the Sellers there has not been, and are, no infringing uses by third parties of the Intellectual Property owned by the Company. No Seller owns or has any interest in the Intellectual Property used by the Company in connection with the Business. No past or present employee or independent contractor (including consultants) of the Company has any ownership interest, license, permission or other right in or to any Intellectual Property, ideas, inventions, processes, works of authorship and other work products that relate to the Business, that were conceived, created, authored or developed, in whole or in part, by such employee or independent contractor.

4.15   Real Property. The Company does not, directly or indirectly, own any real property, nor has it ever owned any real property. Schedule 4.15 sets forth the address of each parcel of real estate leased by the Company (“Leased Real Property”), a true and complete list of all leases for each such Leased Real Property, and the amount of security deposit for each such Leased Real Property. The Company has not collaterally assigned or granted any other security interest in any Leased Real Property or any interest therein. Except as set forth on Schedule 4.15, each Contract for Leased Real Property is legal, valid, binding, enforceable and in full force and effect, and the Company’s possession and quiet enjoyment of the Leased Real Property under such lease has not been disturbed, and there are no disputes with respect to such lease. Except as set forth on Schedule 4.15, neither the Company nor any other party to the lease is in breach or default under such lease, and no event has occurred or circumstance exists which, with the delivery of notice, the passage of time or both, would constitute such a breach or default, or permit the termination, modification or acceleration of rent under such lease.

4.16   Labor Matters. The Company is in compliance in all material respects with all Laws with respect to employment and employment practices, terms and conditions of employment and wages and hours (including the Employee Retirement Income Security Act of 1974, as amended, and the Contract Service Act, as amended), including requirements for paying applicable Service Contract Act wage rate and fringe benefit rates, and the Company is not engaged in any unfair labor practice and has not been threatened with a possible claim for any such practice. The Company has properly classified its employees and independent contractors. Except as set forth in Schedule 4.16, the Company is not, and has not been for the past five years, a party to, bound by, or negotiating any collective bargaining agreement or other Contract with a union, works council or labor organization (collectively, “Union”), and there is not, and has not been for the past five years, any Union representing or purporting to represent any employee of the Company, and no Union or group of employees is seeking or has sought to organize employees for the purpose of collective bargaining. Except as set forth in Schedule 4.16, there has never been, nor has there been any threat of, any strike, slowdown, work stoppage, lockout, concerted refusal to work overtime or other similar labor disruption or dispute affecting the Company or any of its employees. The Company has no duty to bargain with any Union.

4.17   Tax Matters. Schedule 4.17 contains a list of states, territories, and jurisdictions (whether foreign or domestic) in which the Company files Tax Returns. The Company has filed all Tax Returns that it was required to file. All such filed Tax Returns were true, correct, and complete. Except as set forth on Schedule 4.17, all Taxes due and payable prior to Closing by the Company have been paid. The Company has withheld and paid all Taxes required to have been withheld and paid in connection with amounts paid or owing to any employee. There are no Liens on any of the assets of the Company that arose in connection with any failure (or alleged failure) to pay any Tax. The Company has not received any notice from any Governmental Entity that it is subject to an audit or investigation that could result in the payment of additional Taxes. The Company is not a party to any Tax allocation, sharing, indemnity or similar agreement. The Company has no Liability for the Taxes of any Person, as a transferee or successor, by Contract, or otherwise.

4.18 Absence of Certain Developments. Since January 1, 2019, except with respect to cash distributions to the Sellers, the Company has conducted its business in the ordinary course of business consistent with past practice.

4.19 Related Party Transactions. Except as set forth on Schedule 4.19, the Company is not currently a party to any Related Party Transaction in connection with the Business and has not been a party to any such Related Party Transaction since January 1, 2017.

4.20 Safety Rating. Except as set forth on Schedule 4.20, the Company has an overall “Satisfactory” safety rating, and maintained Compliance, Safety and Accountability scores (“CSA Scores”) below the “alert” threshold in each of the seven categories assessed by the DOT in connection therewith. To the Knowledge of the Sellers, there are no issues, deficiencies or violations which would adversely affect such safety rating or CSA Scores. Neither any Seller nor the Company has received any written or other notice of any intended, pending or proposed audit of the Business by the DOT or any other Governmental Entity having jurisdiction over the Company’s operation of the Business.

4.21   Intentionally Omitted.

4.22   Brokerage and Finder’s Fees. Neither the Company nor any Seller has incurred and neither the Company nor any Seller will incur any brokerage, finder, or similar fee in connection with the transactions contemplated by the Transaction Documents to which any of them are a party.

4.23  Vendors. The Company provided Buyer accurate and complete lists of the names and addresses of the 10 largest vendors of the Business from whom the Company has purchased either supplies or inventories for the past two fiscal years (ended December 31, 2018 and December 31, 2017).

4.24   Environmental Matters.

(a) The Company is in compliance in all material respects with all applicable Environmental Laws. The Company holds and has timely applied for renewal of all permits or other authorizations under Environmental Laws that are required for (i) the occupancy, use and operation of its properties and assets, and (ii) the operation and conduct of such Company and the Business.

(b) The Company has not received any outstanding and unresolved written or oral notices, reports, or other information regarding any actual or alleged violation of Environmental Laws by the Company, or any Liabilities or potential Liabilities, including any remedial obligations, arising under Environmental Laws and relating to the Company or its properties. There are no pending or threatened, claims, Liens, or other restrictions of any nature, resulting from any violation or failure to comply with any applicable Environmental Law, with respect to or affecting any of the properties currently occupied, used or operated by the Company. There are no present or past actions, activities, circumstances, conditions, facts, events or incidents, including without limitation, the Release or threatened Release or presence of any Hazardous Substances, which could form the basis for any litigation against the Company or that could result in the imposition of any Liability on the Company, in each case under Environmental Laws.

(c) No facts, events, or conditions relating to the past or present properties or operations of the Company will prevent, hinder, or limit the Company’s continued compliance with Environmental Laws, or give rise to any remedial obligations or material Liability of the Company pursuant to Environmental Laws. During or prior to the period of (i) the Company’s occupancy, use or operation of any property, or (ii) the Company’s participation in the management of any property, there were no Releases or threatened Releases of any Hazardous Substances in, on, under or affecting any such property, and the Company has not placed, held, located, Released, transported or disposed of any Hazardous Substances on, under, from or at any such property or any other property other than in compliance with applicable Environmental Laws. Except as set forth on Schedule 4.24(c), no above ground or underground storage tanks, asbestos-containing materials, lead-based paint, toxic mold or polychlorinated biphenyls are or have been present at any property currently or formerly leased or operated by the Company. The Company has not sent or disposed of Hazardous Substances to or at a site which, pursuant to the Comprehensive Environmental Response, Compensation, and Liability Act (42 U.S.C. § 9601 et seq.), or any similar state, federal or foreign law, has been listed or proposed for listing on the “National Priorities List” or its state equivalent.

(d) The Company has delivered to Buyer correct and complete copies of all environmental studies or reports (including, but not limited to, any Phase I or Phase II reports and compliance audits), pleadings, analytical data, monitoring data, permits required under Environmental Laws, and other material records and correspondence concerning Environmental Laws relating to the occupancy, use and operation of its properties and the operation of the Business that are in the possession or reasonable control of the Sellers.

4.25   Employee Benefit Plans. Set forth on Schedule 4.25 is a complete list of all pension, profit sharing, retirement, stock purchase, stock option, bonus, incentive compensation and deferred compensation plans, life, health, dental, accident or disability, workers’ compensation or other employee welfare benefit plans (insured or self-insured), educational assistance, pre-tax premium or flexible spending account plans, supplemental or executive benefit plans, non-qualified retirement plans, severance or separation plans, and any other employee benefit plans, practices, policies or arrangements of any kind, whether written or oral, which are currently maintained by the Company for the benefit of any of their respective employees (including former employees), or under which the Company has any current or potential Liability with respect to any employee or former employee or the dependents of any such person, including any “employee benefit plan” which is subject to the Employee Retirement Income Security Act of 1974, as amended (“ERISA”) (herein collectively referred to as “Employee Benefit Plans” and individually as an “Employee Benefit Plan”). All Employee Benefit Plans comply in form and in operation in all material respects with their terms, the applicable requirements of ERISA, the Code and all applicable Laws. The Company has complied in all material respects with the terms of all Employee Benefit Plans and related Contracts. Buyer has been supplied with or been provided access to a true and correct copy of all written Employee Benefit Plans and true and correct written summaries of all oral Employee Benefit Plans. With respect to the Employee Benefit Plans, no event has occurred and, there exists no condition or set of circumstances, in connection with which the Company could be subject to any Liability (other than for routine claims for benefits in the ordinary course) under the terms of the Employee Benefit Plans or any applicable Law. The Company does not sponsor or participate in (i) a pension plan that is subject to Title IV of ERISA, Section 302 of ERISA or Section 412 of the Code, (ii) a “multi-employer pension plan,” as defined in Section 3(37) of ERISA, (iii) a “multiple employer welfare arrangement,” as defined in Section 3(40) of ERISA, (iv) a “multiple employer plan,” as defined in Section 413 of the Code, (v) a “welfare benefits trust” or “voluntary employees beneficiary association,” as defined in Sections 419, 419A or 501(c)(9) of the Code, or (vi) a plan or arrangement providing for post-employment health or life insurance coverage, except as otherwise required by Section 4980B of the Code or similar state Laws and at the sole expense of the individual.

4.26   Accounts; Powers of Attorney. Schedule 4.26 sets forth a correct and complete list of all accounts or safe deposit boxes at any bank or other financial institution of the Company, and the names of all Persons authorized to draw thereon or have access thereto. Except as set forth on Schedule 4.26, no Person holds a power of attorney to act on behalf of the Company.

Article V - REPRESENTATIONS AND WARRANTIES OF BUYER

Buyer represents and warrants to the Sellers that the statements contained in this Article V are true and correct as of the date hereof:

5.1   Organization and Qualification. Buyer is a corporation duly incorporated, validly existing and in good standing under the Laws of Delaware. Buyer is qualified to transact business as a foreign entity and is in good standing under the Laws of each jurisdiction in which the nature of its business or the ownership or leasing of its properties requires such qualification, except where the failure to so qualify has not and would not reasonably be expected to have a Material Adverse Effect on Buyer.

5.2  Power and Authority; Enforceability. Buyer has all requisite corporate power and authority to enter into and consummate the transactions contemplated by the Transaction Documents to which Buyer is a party. The execution and delivery by Buyer of the Transaction Documents to which it is a party and the consummation of the transactions contemplated thereby have been duly authorized by all necessary action on the part of Buyer. The Transaction Documents have been duly executed and delivered by Buyer and constitute the legal, valid and binding obligations of Buyer, enforceable against Buyer in accordance with their respective terms, except to the extent that (a) their enforceability may be limited by applicable bankruptcy, insolvency, reorganization or other Laws affecting the enforcement of creditor’s rights generally, and (b) the availability of equitable remedies is subject to the discretion of the court before which any such proceeding may be brought.

5.3  No Conflict. Neither the execution and delivery of this Agreement nor the performance of the provisions hereof or the transactions contemplated hereby: (a) violate or conflict with Buyer’s Organizational Documents; (b) materially violate or conflict with any Law, rule, regulation, writ, judgment, injunction, decree, determination, award or other order of any court, government or governmental agency or instrumentality, domestic or foreign, that is applicable to Buyer; or (c) will result in a material breach of any of the terms or conditions of, or constitute a material default under, any mortgage, note, bond, indenture, agreement, license or other instrument or obligation to which Buyer is a party or by which any of its respective properties or assets may be bound or affected. The execution, delivery and performance of this Agreement and the consummation of the transactions contemplated hereby do not require any material authorization, consent, approval, exemption or other material action by or notice to any Governmental Entity or other third party, under any Material Contract or Governmental Contract to which the Company is bound, or any law, statute, rule or regulation or order, judgment or decree to which the Company is subject.

5.4  Brokerage and Finder’s Fee. Buyer has not incurred and will not incur any brokerage, finder, or similar fee in connection with the transactions contemplated by the Transaction Documents to which it is a party.

5.5  Investment Intent. Buyer is acquiring the Equity Interests for its own account for investment purposes only and not with a view to any public distribution thereof or with any intention of selling, distributing or otherwise disposing of the Equity Interests in a manner that would violate the registration requirements of the Securities Act of 1933, as amended (the “Securities Act”). Buyer agrees that the Equity Interests may not be sold, transferred, offered for sale, pledged, hypothecated or otherwise disposed of without registration under the Securities Act and any applicable state securities laws, except pursuant to an exemption from such registration under the Securities Act and such laws. Buyer is able to bear the economic risk of holding the Equity Interests for an indefinite period (including total loss of its investment), and (either alone or together with its Representatives) has sufficient knowledge and experience in financial and business matters so as to be capable of evaluating the merits and risk of its investment.

5.6  Buyer’s Investigation and Reliance. Buyer is a sophisticated purchaser and has made its own investigation, review and analysis regarding the Companies and the transactions contemplated hereby, which investigation, review and analysis were conducted by Buyer together with expert advisors that it has engaged for such purpose. Buyer and its Representatives have been provided with full and complete access to the Representatives, properties, offices, plants and other facilities, books and records of the Company and its Subsidiaries and other information that they have requested in connection with their investigation of the Companies and the transactions contemplated hereby. Buyer is not relying on any statement, representation or warranty, oral or written, express or implied, made by the Sellers or their Affiliates or Representatives with respect to the Companies, except as expressly set forth in Article IV and the Disclosure Schedules. Neither the Sellers nor any of their Affiliates or Representatives shall have any liability to Buyer or any of its Affiliates or Representatives resulting from the use of any information, documents or materials made available to Buyer, whether orally or in writing, in any confidential information memoranda, “data rooms”, management presentations, due diligence discussions or in any other form in expectation of the transactions contemplated by this Agreement. Neither the Sellers nor any of their Affiliates or Representatives is making, directly or indirectly, any representation or warranty with respect to any estimates, projections or forecasts involving the Companies. Buyer acknowledges that there are inherent uncertainties in attempting to make such estimates, projections and forecasts and that it takes full responsibility for making its own evaluation of the adequacy and accuracy of any such estimates, projections or forecasts (including the reasonableness of the assumptions underlying any such estimates, projections and forecasts). Buyer acknowledges that, should the Closing occur, Buyer shall acquire the Companies without any representation or warranty as to merchantability or fitness for any particular purpose of their respective assets, on an “as is” and “where is” basis, except as expressly set forth in Article IV and the Disclosure Schedules. Buyer has no Knowledge or reason to believe that any of the representations or warranties made by the Sellers as of the date hereof are untrue, incomplete or inaccurate. Nothing in this Section 5.6 is intended to modify or limit any of the representations or warranties of the Sellers set forth in Article IV.

Article VI - INDEMNIFICATION

6.1   Survival of Representations, Warranties, Covenants and Agreements. The representations, warranties, covenants and agreements in this Agreement and the Disclosure Schedules attached hereto or in any writing delivered by any Party to any of the other Parties in connection with this Agreement will survive (a) for a period of 18 months after the Closing Date for representations and warranties except as set forth in subparts (b), (b) indefinitely for the representations and warranties set forth in Sections 4.1, 4.2, 4.4, and 4.17 (collectively, the “Fundamental Representations”), (c) indefinitely for claims based on fraud, (d) indefinitely for all covenants and agreements that by their terms contemplate performance after the Closing Date, unless specified otherwise by their terms, or (e) the statute of limitations plus thirty (30) days for all other claims. Notwithstanding the above, so long as written notice of a claim is given on or prior to the expiration of survival period, such claim will continue to survive until such matter is resolved.

6.2   Indemnification by the Sellers. The Sellers agree to indemnify, defend and hold harmless Buyer and its Affiliates, directors, managers, officers, equity holders, members, partners, and their respective successors and assigns (the “Buyer Indemnified Parties”) from, against and in respect of any Losses imposed on, sustained, incurred or suffered by or asserted against any of Buyer Indemnified Parties directly or indirectly, whether or not due to a third-party claim, arising out of or resulting from:

(a) a breach of any representation or warranty of Sellers made in this Agreement;

(b) a breach of any covenant or agreement of any Seller made in this Agreement;

(c) any unpaid Taxes of either Company; and

(d) any Outstanding Transaction Expenses of either Company.

6.3   Indemnification by Buyer. Buyer agrees that it will indemnify, defend, and hold harmless the Sellers and their Affiliates, partners, and their respective successors and assigns (the “Seller Indemnified Parties”), from, against and in respect of any and all Losses imposed on, sustained, incurred or suffered by or asserted against any of the Seller Indemnified Parties directly or indirectly, whether or not due to a third-party claim, arising out of or resulting from:

(a) any breach of any representation or warranty of Buyer made in this Agreement; and

(b) a breach of any covenant or agreement of Buyer made in this Agreement.

6.4   Procedures.

(a) In order for a Buyer Indemnified Party or Seller Indemnified Party (the “Indemnified Party”) to be entitled to any indemnification provided for under this Agreement as a result of a Loss or a claim or demand made by any Person against the Indemnified Party (a “Third Party Claim”), such Indemnified Party shall deliver notice thereof to the party against whom indemnity is sought (the “Indemnifying Party”) promptly after receipt by such Indemnified Party of written notice of the Third Party Claim, describing in reasonable detail the facts giving rise to any claim for indemnification hereunder, the amount or method of computation of the amount of such claim (if known) and such other information with respect thereto as the Indemnifying Party may reasonably request. The failure to provide such notice, however, shall not release the Indemnifying Party from any of its obligations under this Article VI except to the extent that the Indemnifying Party is prejudiced by such failure.

(b) The Indemnifying Party shall have the right, upon written notice to the Indemnified Party within 30 days of receipt of notice from the Indemnified Party of the commencement of such Third Party Claim, to assume the defense thereof at the expense of the Indemnifying Party with counsel selected by the Indemnifying Party and reasonably satisfactory to the Indemnified Party. If the Indemnifying Party assumes the defense of such Third Party Claim, the Indemnified Party shall have the right to employ separate counsel and to participate in the defense thereof, but the fees and expenses of such counsel shall be at the expense of the Indemnified Party. If the Indemnifying Party assumes the defense of any Third Party Claim, the Indemnified Party shall cooperate with the Indemnifying Party in such defense and make available to the Indemnifying Party all witnesses, pertinent records, materials and information in the Indemnified Party’s possession or under the Indemnified Party’s control relating thereto as is reasonably required by the Indemnifying Party. Whether or not the Indemnifying Party assumes the defense of a Third Party Claim, the Indemnified Party shall not admit any liability with respect to, or settle, compromise or discharge, or offer to settle, compromise or discharge, such Third Party Claim without the Indemnifying Party’s prior written consent, (which consent shall not be unreasonably withheld).

(c) In the event any Indemnified Party should have a claim against any Indemnifying Party hereunder that does not involve a Third Party Claim being asserted against or sought to be collected from such Indemnified Party, the Indemnified Party shall deliver notice of such claim promptly to the Indemnifying Party, describing in reasonable detail the facts giving rise to any claim for indemnification hereunder, the amount or method of computation of the amount of such claim (if known) and such other information with respect thereto as the Indemnifying Party may reasonably request. The failure to provide such notice, however, shall not release the Indemnifying Party from any of its obligations under this Article VI except to the extent that the Indemnifying Party is prejudiced by such failure. The Indemnified Party shall reasonably cooperate and assist the Indemnifying Party in determining the validity of any claim for indemnity by the Indemnified Party and in otherwise resolving such matters. Such assistance and cooperation shall include providing reasonable access to and copies of information, records and documents relating to such matters, furnishing employees to assist in the investigation, defense and resolution of such matters and providing legal and business assistance with respect to such matters.

6.5   Limits on Indemnification.

(a) No claim may be asserted against either party for breach of any representation, warranty or covenant contained herein, unless written notice of such claim is received by such party, describing in reasonable detail the facts and circumstances with respect to the subject matter of such claim on or prior to the date on which the representation, warranty or covenant on which such claim is based ceases to survive as set forth in Section 6.1, in which case such representation, warranty or covenant shall survive as to such claim until such claim has been finally resolved.

(b) Notwithstanding anything to the contrary contained in this Agreement:

(i) the maximum aggregate amount of indemnifiable Losses that may be recovered from the Sellers by Buyer Indemnified Parties pursuant to Section 6.2 shall be an amount equal to 15% multiplied by the aggregate total Base Consideration paid by the Seller for the acquisition of all of the Ritter Companies (the “Cap”); provided that any Losses resulting from breaches by the Seller of any of the Fundamental Representations shall not be subject to the Cap and such Losses shall not count towards satisfaction of the Cap; provided further, that the aggregate amount of all indemnifiable Losses that may be recovered from the Seller by Buyer Indemnified Parties pursuant to Section 6.2 (including with respect to any Losses resulting from breaches of any Fundamental Representation) shall not exceed the Purchase Price, as adjusted pursuant to Section 1.4;

(ii)   the Seller shall not be liable to any Buyer Indemnified Party for any claim for indemnification unless and until the aggregate amount of indemnifiable Losses that may be recovered from the Seller equals or exceeds an amount equal to 0.75% multiplied by the aggregate total Base Consideration paid by the Seller for the acquisition of all of the Ritter Companies (the “Basket Amount”), in which case the Seller shall be liable only for the Losses in excess of the Basket Amount; provided, however, that no Losses may be claimed by any Buyer Indemnified Party or shall be reimbursable by the Seller or shall be included in calculating the aggregate Losses for purposes of this clause (ii) other than Losses in excess of $25,000 (the “Minimum Loss Amount”) resulting from any single claim or aggregated claims arising out of the same facts, events or circumstances;

(iii)   in determining whether any claim for indemnification under this Agreement or any of the other Ritter Company Acquisition Agreements exceeds the Cap and/or the Basket Amount, the amount of all such claims under all of the Ritter Company Acquisition Agreements shall be aggregated;

(iv) any payment for Losses claimed by any Buyer Indemnified Party shall be paid by the Sellers as follows (x) 70% of such Losses shall be paid in cash and (y) 30% of such Losses shall be paid by the surrender of Buyer common stock (valued at no less than the value assigned to such common stock under any of the Ritter Company Acquisition Agreements); provided that the Sellers may elect, at their sole option, to pay such Losses in cash only;

(v) the Seller shall not be obligated to indemnify any Buyer Indemnified Party with respect to any Loss to the extent that a specific accrual or reserve for the amount of such Loss was reflected on the Financial Statements or the notes thereto;

(vi) the Seller shall not be obligated to indemnify any Buyer Indemnified Party with respect to any Loss to the extent that the Buyer received a benefit from the reflection of such matter in the calculation of the adjustment of the Purchase Price, if any, as finally determined pursuant to Section 1.4;

(vii)   no party hereto shall have any liability under any provision of this Agreement for any punitive, incidental, consequential, special or indirect damages, including business interruption, loss of future revenue, profits or income, or loss of business reputation or opportunity relating to the breach or alleged breach of this Agreement; and

(viii)   in the event Buyer proceeds with the Closing notwithstanding actual knowledge by the Buyer or any Affiliate of Buyer at or prior to the Closing of any breach by the Seller of any representation, warranty or covenant in this Agreement, no Buyer Indemnified Party shall have any claim or recourse against the Seller or any of its Affiliates or Representatives with respect to such breach, under this Article VI or otherwise.

(c) For all purposes of this Article VI, “Losses” shall be net of (i) any insurance or other recoveries payable to the Indemnified Party or its Affiliates in connection with the facts giving rise to the right of indemnification and (ii) any Tax benefit available to such Indemnified Party or its Affiliates arising in connection with the accrual, incurrence or payment of any such Losses (including, without limitation, the net present value of any Tax benefit arising in subsequent taxable years).

(d) Buyer and the Sellers shall cooperate with each other with respect to resolving any claim, liability or Loss for which indemnification may be required hereunder, including by making, or causing the applicable Indemnified Party to make, all reasonable efforts to mitigate any such claim, liability or Loss. In the event that Buyer or the Sellers shall fail to make such reasonable efforts, then notwithstanding anything else to the contrary contained herein, the other party shall not be required to indemnify any Person for any claim, liability or Loss that could reasonably be expected to have been avoided if such efforts had been made. Without limiting the generality of the foregoing, Buyer and the Sellers shall, or shall cause the applicable Indemnified Party to, use reasonable efforts to seek full recovery under all insurance policies covering any Loss to the same extent as they would if such Loss were not subject to indemnification hereunder.

6.6   Assignment of Claims. If any Buyer Indemnified Party receives any payment from the Seller in respect of any Losses pursuant to Section 8.2 and the Buyer Indemnified Party could have recovered all or a part of such Losses from a third party (a “Potential Contributor”) based on the underlying claim asserted against the Seller, the Buyer Indemnified Party shall assign, on a non-recourse basis and without any representation or warranty, such of its rights to proceed against the Potential Contributor as are necessary to permit the Seller to recover from the Potential Contributor the amount of such payment. If any such assignment would afford the Potential Contributor any defense to the payment of the same, such assignment shall not take place and the Buyer Indemnified Party will, at the Seller’s direction and expense, take all reasonable actions to seek to recover such claim from such Potential Contributor. Any payment received in respect of such claim against the Potential Contributor (whether by the Seller or the relevant Buyer Indemnified Party as provided in the immediately preceding sentence) shall be distributed, (i) first, to the Buyer Indemnified Party in the amount of any deductible or similar amount required to be paid by the Buyer Indemnified Party prior to the Seller being required to make any payment to the Buyer Indemnified Party plus, in the case of any claim by a Buyer Indemnified Party as provided in the immediately preceding sentence, the costs and expenses incurred in investigating, prosecuting, defending or otherwise addressing such claim, (ii) second, to the Seller in an amount equal to the aggregate payments made by the Seller to the Buyer Indemnified Party in respect of such claim, plus the costs and expenses incurred in investigating, prosecuting, defending or otherwise addressing such claim and (iii) the balance, if any, to the Buyer Indemnified Party.

6.7   Exclusivity. Except as specifically set forth in this Agreement, effective as of the Closing, in the absence of fraud by the Sellers (to the extent determined by a final judgment by a court of competent jurisdiction), Buyer, on behalf of itself and the other Buyer Indemnified Parties, waives any rights and claims any Buyer Indemnified Party may have against the Sellers, whether in law or equity, relating to the Companies and/or the transactions contemplated hereby. The rights and claims waived by Buyer, on behalf of itself and the other Buyer Indemnified Parties, include, without limitation, claims for contribution or other rights of recovery arising out of or relating to any Environmental Laws, claims for breach of contract, breach of representation or warranty, negligent misrepresentation and all other claims for breach of duty. After the Closing, subject to the foregoing, this Article VI will provide the exclusive remedy against the Sellers for any breach of any representation, warranty, covenant or other claim arising out of or relating to this Agreement and/or the transactions contemplated hereby.

6.8   Tax Treatment of Indemnity Payments. All payments made pursuant to any indemnification obligations under this Agreement, will be treated as adjustments to the Purchase Price for Tax purposes and such agreed treatment will govern for purposes of this Agreement, unless otherwise required by applicable Laws.

6.9   Offset. Buyer will have the right to set off the indemnification obligations of the Sellers pursuant to this Article VI against any other payments, if any, due to the Sellers, whether under this Agreement or any other agreement among the Parties. No set off shall be permitted unless either (a) the Sellers have agreed in writing that it is liable for the relevant Losses or (b) if disputed, there has been a final, non-appealable award granting the relevant Buyer Indemnified Party such Losses.

Article VII - MISCELLANEOUS PROVISIONS

7.1   Expenses. The Parties will each bear their own costs and expenses relating to the negotiation and the implementation of the transactions contemplated hereby, including, without limitation, fees and expenses of legal counsel, accountants, investment bankers, brokers or finders, printers, copiers, consultants or other representatives, whether or not such transactions are consummated.

7.2   Amendment and Modification; Waivers, Third-Party Beneficiary. This Agreement may be amended, or any provision of this Agreement may be waived upon the approval, in a writing, executed by Buyer and the Sellers. This Agreement will not confer any rights or remedies upon any Person other than the Parties and their respective successors and permitted assigns, other than: (i) the Released Parties, who are intended third-party beneficiaries of the provisions set forth in Section 3.7, and (ii) the Buyer Indemnified Parties and Seller Indemnified Parties, who are intended third-party beneficiaries of the provisions set forth in Article VI. Any waiver or consent will be effective only in the specific instance and for the specific purpose for which it is given.

7.3   Notices. All notices, requests, demands and other communications required or permitted hereunder will be made in writing and will be deemed to have been duly given and effective: (a) on the date of delivery, if delivered personally; (b) on the first Business Day following the date of dispatch if delivered by a recognized next-day courier service; or (c) on the earlier of the fourth (4^th) day after mailing or the date of the return receipt acknowledgment, if mailed, postage prepaid, by certified mail, return receipt requested. All notices hereunder must be delivered to the following addresses:

If to Sellers:

Matthew L. Ritter

10313 Princeton Circle

Ellicott City, MD 21042

and

Michael J. Ritter

908 Glouster Circle

Hampstead, MD 21074

With copies to the following, which will not constitute notice:

Offit Kurman P.A.

4800 Montgomery Lane

9^th Floor

Bethesda, MD 20814

Attn: Michael Mercurio; Brent Salmons

If to Buyer or Parent:

EVO Transportation & Energy Services, Inc.

Attn: John Yeros, CEO

8285 West Lake Pleasant Parkway

Peoria, AZ 85382

With copies to the following, which will not constitute notice:

Fredrikson & Byron, P.A.

200 South Sixth Street, Suite 4000

Minneapolis, MN 55402-1425

Attn: Frank B. Bennett; Patrick Seul

7.4   Assignment. This Agreement and all of the provisions hereof will be binding upon and inure to the benefit of the Parties hereto and their respective successors and permitted assigns, except that neither this Agreement nor any of the rights, interests or obligations under this Agreement may be assigned or delegated by any Party without the prior written consent of the other Parties, which consent will not be unreasonably withheld. Notwithstanding the foregoing, (i) Buyer may assign in whole or in part its rights pursuant to this Agreement to one or more of their Affiliates, (ii) Buyer may assign this Agreement and its rights and obligations under this Agreement in connection with a merger or consolidation involving Buyer, or in connection with a sale of substantially all of the equity or assets of Buyer or other disposition of substantially all of the Business provided the assignment will not relieve Buyer of its obligations pursuant to this Agreement, and (iii) Buyer may assign any or all of its rights pursuant to this Agreement or the Transaction Documents, including its rights to indemnification, to any of its lender(s) as collateral security.

7.5   Governing Law; Jurisdiction; Waiver of Jury Trial. This Agreement and the legal relations among the Parties hereto will be governed by and construed in accordance with the internal substantive Laws of the State of Delaware (without regard to the Laws of conflict that might otherwise apply) as to all matters, including without limitation matters of validity, construction, effect, performance and remedies. Each of the Parties hereto irrevocably submits to the exclusive jurisdiction of the courts of the State of Delaware and of the United States located in Delaware, for the purposes of any such action or other proceeding arising out of this Agreement or any transaction contemplated hereby. EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY PROCEEDING (WHETHER BASED IN CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR RELATING TO THIS AGREEMENT, THE OTHER TRANSACTION DOCUMENTS OR ANY TRANSACTION OR AGREEMENT CONTEMPLATED HEREBY OR THE ACTIONS OF ANY PARTY HERETO IN THE NEGOTIATION, ADMINISTRATION, PERFORMANCE OR ENFORCEMENT HEREOF. The Buyer and the Sellers specifically represent and warrant that they were represented by legal counsel and obtained legal advice regarding this Section 7.5 and other provisions of this Agreement.

7.6   Counterparts. This Agreement may be executed simultaneously with original, facsimile, or .pdf signatures in one or more counterparts, each of which will be deemed an original, but all of which together will constitute one and the same instrument.

7.7   Headings. The headings of the sections and subsections of this Agreement are inserted for convenience only and will not constitute a part hereof.

7.8   Entire Agreement. This Agreement and the exhibits and other writings referred to in this Agreement or any such exhibit or other writing are part of this Agreement, together embody the entire agreement and understanding of the Parties hereto in respect of the transactions contemplated by this Agreement. This Agreement supersedes all prior agreements and understandings between the Parties with respect to the transaction or transactions contemplated by this Agreement.

7.9   Severability. Provisions of this Agreement will be interpreted to be valid and enforceable under applicable Law to the extent that such interpretation does not materially alter this Agreement; provided, however, that if any such provision will become invalid or unenforceable under applicable Law such provision will be stricken to the extent necessary and the remainder of such provisions and the remainder of this Agreement will continue in full force and effect.

7.10   Cumulative Remedies; Specific Performance. All rights and remedies of a Party hereto are cumulative of each other and of every other right or remedy such Party may otherwise have at law or in equity, and the exercise of one or more rights or remedies will not prejudice or impair the concurrent or subsequent exercise of other rights or remedies. Each Pary will expressly be entitled to specific performance as a remedy.

7.11   Publicity. The Sellers will issue any press release or make any other public statement relating to the transactions contemplated hereby unless (a) agreed to by the other Parties hereto, or (b) required by Law or court order and any such release or statement will be subject to prior review by the other Parties hereto.

[Signature Page Follows]

IN WITNESS WHEREOF, the Parties hereto have caused this Stock Exchange Agreement to be duly executed as of the day and year first above written.

Signature Page to Stock Exchange Agreement

EXHIBIT A

Sellers

EXHIBIT B

DEFINITIONS

As used in this Agreement, the following terms will have the meanings indicated below.

“Affiliate” of any specified Person means any other Person directly or indirectly controlling or controlled by or under direct or indirect common control with such specified Person. For the purposes of this definition, “Control” or “Controlling” or “Controlled by” will mean, when used with respect to any specified Person, the power to direct the management and policies of such Person, directly or indirectly, whether through the ownership of voting securities, by Contract or otherwise.

“Business Day” means any day other than Saturday or Sunday on which banks are open for business in Phoenix, Arizona.

“Closing Date Net Working Capital” means, as of the Effective Time, the Current Assets minus the Current Liabilities, calculated in accordance with the Accounting Principles,

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

“Contracts” means all oral or written contracts, agreements, instruments and other documents to which a Person is a party or by which it or its assets is or are bound.

“Current Assets” means the current assets of the Ritter Companies, calculated in accordance with the Accounting Principles, and on a consolidated basis.

“Current Liabilities” means the current liabilities of the Ritter Companies, calculated in accordance with the Accounting Principles, and on a consolidated basis.

“DOT” means the United States Department of Transportation.

“Environmental Law” means all Laws: (a) relating to pollution (or the cleanup thereof) or the protection of natural resources, endangered or threatened species, or the environment (including ambient air, soil, surface water or groundwater, or subsurface strata); or (b) concerning the presence of, exposure to, or the management, manufacture, use, containment, storage, recycling, reclamation, reuse, treatment, generation, discharge, transportation, processing, production, disposal, or remediation of any Hazardous Substances. The term “Environmental Law” includes the following (including their implementing regulations, any state analogs or any similar laws in foreign jurisdictions): the Comprehensive Environmental Response, Compensation, and Liability Act of 1980, as amended by the Superfund Amendments and Reauthorization Act of 1986, 42 U.S.C. §§ 9601 et seq.; the Solid Waste Disposal Act, as amended by the Resource Conservation and Recovery Act of 1976, as amended by the Hazardous and Solid Waste Amendments of 1984, 42 U.S.C. §§ 6901 et seq.; the Federal Water Pollution Control Act of 1972, as amended by the Clean Water Act of 1976, as amended, 15 U.S.C. §§ 2601 et seq.; the Emergency Planning and Community Right to Know Act of 1986, 42 U.S.C. §§ 11001 et seq.; and the Clean Air Act of 1966, as amended by the Clean Air Act Amendments of 1990, 42 U.S.C. §§ 7401 et seq.

“GAAP” means U.S. generally accepted accounting principles, consistently applied.

“Government Bid” means any outstanding bid, offer or proposal which, if accepted or successful, would result in a Current Government Contract.

“Government Contract” means any prime contract, subcontract, purchase order, task order, delivery order, basic ordering agreement, pricing agreement, teaming agreement, letter contract, joint venture or other similar written arrangement between the Company, on the one hand, and (i) any Governmental Entity or (ii) any higher-tier contractor of a Governmental Entity in its capacity as a higher-tier contractor, on the other hand. A purchase order, a task order or a delivery order under a Government Contract shall not constitute a separate Government Contract, for purposes of this definition, but shall be part of the Government Contract to which it relates.

“Governmental Entity” means any court, administrative agency or commission, self-regulatory organization or other foreign, domestic, or quasi-governmental authority or instrumentality.

“Hazardous Substances” means all hazardous substances, as that term is defined in the Comprehensive Environmental Response, Compensation, and Liability Act (42 U.S.C. § 9601 et seq.), solid waste, hazardous waste and any other individual or class of pollutants, contaminants, toxins, chemicals, substances, wastes or materials in their solid, liquid or gaseous phase, defined, regulated, classified or identified under any Environmental Law, including without limitation petroleum, petroleum products, friable asbestos, molds, urea formaldehyde, radioactive materials and polychlorinated biphenyls.

“Indebtedness” means, with respect to any Person at any date, without duplication: (a) all obligations of such Person for borrowed money or in respect of loans or advances; (b) all obligations of such Person evidenced by bonds, debentures, notes or other similar instruments; (c) all obligations in respect of letters of credit, whether or not drawn, and bankers’ acceptances issued for the account of such Person; (d) all capital lease liabilities of such Person determined in accordance with GAAP; (e) all guarantees of such Person in connection with any of the foregoing; (f) any debt-like obligation or financing-type arrangement in respect of the deferred purchase price of property or property received as of the Closing with respect to which such Person is liable, contingently or otherwise, as obligor or otherwise; (g) any accrued interest, prepayment premiums or penalties or other costs or expenses related to any of the foregoing; and (h) all obligations or indebtedness of the Company owed to any Seller.

“Insider” means (a) any officer, director, or owner of the Company; (b) any individual related by blood, marriage or adoption to any individual listed in clause (a) hereof; or (c) any Person in which any individual listed in clauses (a) or (b) hereof has a beneficial interest.

“Knowledge” means the actual knowledge of such Person after reasonable inquiry, and “Knowledge” as it is applied to the Company, means the actual knowledge of Matthew Ritter and Michael Ritter, after reasonable inquiry.

“Law” means any federal, state, local, municipal, foreign, international, multinational, or other administrative order, constitution, law, ordinance, principle of common law, regulation, statute, or treaty.

“Liability” or “Liabilities” means any liability or obligation of whatever kind or nature (whether known or unknown, whether asserted or unasserted, whether absolute or contingent, whether accrued or unaccrued, whether liquidated or unliquidated, and whether due or to become due), including any liability for Taxes.

“Lien” means any mortgage, pledge, deed of trust, assignment, lien, charge, encumbrance, judgment, pledge or security interest of any kind or nature whatsoever or any claim of right of any third-party, or the interest of a vendor or lessor under any conditional sale Contract, capital lease or other title retention Contract.

“Losses” means any and all losses, Liabilities, damages, fees, direct and indirect damages (excluding consequential and incidental damages, lost profits, and punitive damages unless owed to a third party), and costs and expenses (including costs of investigation and defense and reasonable fees and expenses of lawyers, experts and other professionals).

“Material Adverse Effect” means any event, change, circumstance, occurrence, effect or state of facts that is or could reasonably be expected to be materially adverse to the business, assets, liabilities, condition (financial or otherwise), results of operations, or prospects of the Business.

“Material Contract” means:

(i)  each Contract of the Company involving aggregate consideration in excess of $250,000;

(ii)  all Contracts that require the Company to purchase its total requirements of any product or service from a third party or that contain “take or pay” provisions;

(iii)  [intentionally omitted];

(iv)  all Contracts that relate to the acquisition or disposition of any business, a material amount of stock or assets of any other Person or any real property (whether by merger, sale of stock, sale of assets or otherwise);

(v)  all broker, distributor, dealer, manufacturer’s representative, franchise, agency, sales promotion, market research, marketing consulting and advertising Contracts to which the Company is a party;

(vi)  all employment agreements and Contracts with independent contractors or consultants (or similar arrangements) that are not terminable by the Company on 60 days’ notice or less;

(vii)  except for Contracts relating to trade receivables, all Contracts relating to Indebtedness;

(viii)  all Government Contracts;

(ix)  all Contracts that limit or purport to limit the ability of the Company to compete in any line of business or with any Person or in any geographic area or during any period of time;

(x)  any Contracts to which the Company is a party that provide for any joint venture, partnership or similar arrangement by the Company;

(xi)  all Contracts between or among the Company on the one hand and any Seller or any Affiliate of a Seller on the other hand;

(xii)  all collective bargaining agreements or Contracts with any Union to which the Company is a party; and

(xiii)  any other Contract that is material to the Company and not previously disclosed pursuant to subparts (i) – (xii).

“Ordinary Course of Business” means the ordinary course of the Business, consistent with past practice, including with regard to nature, frequency, and magnitude.

“Organizational Documents” means the articles or certificate of incorporation, bylaws, limited liability company agreement, partnership agreement or other governing documents of an entity.

“Outstanding Transaction Expenses” means fees and expenses incurred by the Companies or the Sellers on or prior to the Closing relating to the negotiation, execution and delivery of this Agreement and the other Transaction Documents.

“Permitted Liens” means (a) liens for current Taxes, assessments or other claims by a Governmental Entity not yet delinquent or the amount or validity of which is being contested in good faith by appropriate proceedings; (b) mechanics’, carriers’, workers’, repairers’ and similar Liens arising or incurred in the ordinary course of business that are not material to the Business; and (c) such other imperfections in title, charges, restrictions, or Liens that do not, individually or in the aggregate, materially detract from or diminish the value of or materially interfere with the present ownership, use and operation of such asset as used in the Business.

“Person” means any individual, corporation, partnership, joint venture, limited liability company, trust, unincorporated organization, Governmental Entity, or other legally recognized entity.

“Pre-Closing Tax Period” means any Tax period ending on or prior to the Closing Date and the portion of any Straddle Period up to and including the Closing Date.

“Related Party Transaction” means any Contract, arrangement, or understanding under which a Company or its Insiders (a) has borrowed any monies from or has outstanding any indebtedness or other similar obligations to the Company or its Affiliates; (b) owns any direct or indirect interest of any kind in, or is a director, officer, member, employee, partner, equity owner, consultant or lender to, or borrower from, or has the right to participate in the management, operations or profits of, any Person which is (i) a competitor, supplier, customer, distributor, lessor, tenant, creditor or debtor of a Company, or (ii) participates in any transaction to which a Company is a party; or (c) is or has been a party to any Contract, arrangement, understanding or transaction with a Company.

“Release” or “Released” will have the meaning specified in 42 U.S.C. § 9601.

“Ritter Companies” means the Company (i.e. John W. Ritter, Inc.), Ritter Transportation Systems, Inc., Ritter Transport, Inc, and Johmar Leasing Company, LLC.

“Ritter Company Acquisition Agreements” means, collectively, this Agreement and the other agreements entered into between the Parties on the same date hereof pursuant to which the Buyer is acquiring from the Sellers the other Ritter Companies.

“Tax Return” means all returns, declarations, reports, statements, computations and other documents required to be filed with any Governmental Entity in respect of Taxes.

“Taxes” means federal, state, county, local, foreign or other income, gross receipts, ad valorem, franchise, profits, sales or use, transfer, registration, excise, utility, environmental, communications, real or personal property, membership interest, license, payroll, wage or other withholding, employment, social security, severance, stamp, occupation, alternative or add-on minimum, estimated and other taxes of any kind whatsoever (including deficiencies, penalties, additions to tax, and interest attributable thereto) whether disputed or not.

EXHIBIT C-1

RESTATED LEASE

[See attached.]

EXHIBIT C-2

RESTATED LEASE

[See attached.]

EXHIBIT C-3

RESTATED LEASE

[See attached.]

EXHIBIT D

Form of Employment Agreement

[See attached.]

Exhibit 2.2

STOCK PURCHASE AGREEMENT

This Stock purchase Agreement (this “Agreement”) is made effective as of September 16, 2019, by and among EVO Holding Company, LLC, a Delaware limited liability company (“Buyer”), EVO Transportation & Energy Services, Inc., a Delaware corporation (“Parent”), and the stockholders listed on Exhibit A hereto (each, individual, a “Seller” and, collectively, the “Sellers”). Buyer and the Sellers may be referred to individually in this Agreement as a “Party” and collectively as the “Parties.” Capitalized Terms used herein and not otherwise defined have the meanings given to such terms in Exhibit B attached hereto. Parent joins this Agreement solely to guaranty (a) the payment of any indemnification obligations of Buyer, and (b) the performance by Buyer of Buyer’s covenants set forth in this Agreement.

RECITALS

A. The Sellers own all of the issued and outstanding equity interests (collectively, the “Equity Interests”) of Ritter Transportation Systems, Inc. and Ritter Transport, Inc. (each, a “Company” and, collectively, the “Companies”).

B. The Companies are engaged in the business of providing freight trucking services to non-government entities (the “Business”).

C. The Parties desire to enter into this Agreement whereby the Sellers propose to sell to Buyer, and Buyer proposes to purchase from the Sellers, all of the Equity Interests, such that Buyer will become the sole equity owner of each Company.

D. Each Seller will receive substantial financial benefit from the transaction set forth in this Agreement and understand that being parties to certain sections of this Agreement (including Section 3.5) is a condition to Buyer entering into this Agreement.

AGREEMENTS

In consideration of the representations, warranties, covenants, agreements, and conditions set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereby agree as follows:

Article I - SALE AND PURCHASE OF THE EQUITY INTERESTS

1.1 Exchange of Equity Interests. Subject to the terms and conditions set forth herein, at the Closing, each Seller shall sell and deliver to Buyer, and Buyer shall purchase from each Seller, the Equity Interests set forth next to such Seller’s name on Exhibit A, free and clear of all Liens, for the consideration specified in Section 1.2.

1.2 Purchase Price; Payment.

(a) The aggregate purchase price to be paid by Buyer to the Sellers (the “Purchase Price”) will be an aggregate of Thirteen Million Seven Hundred Thirty Nine Thousand Fifty-Six Dollars and Zero Cents ($13,739,056.00) (the “Base Consideration”) which such amount shall be (i) increased by the amount by which the Closing Date Net Working Capital, as set forth in the Final Statement of Net Working Capital, exceeds the Target Net Working Capital, or (ii) decreased by the amount by which the Closing Date Net Working Capital, as set forth in the Final Statement of Net Working Capital, is less than the Target Net Working Capital. The Purchase Price shall be paid in cash at the Closing.

(b) At the Closing, Buyer shall pay to Sellers an amount equal to the Base Consideration, adjusted as provided in this Section 1.2(b) (as so adjusted, the “Closing Payment”), by wire transfer of immediately available funds to an account or accounts designated by Sellers prior to the Closing Date. For purposes of calculating the Closing Payment, at least two days prior to the Closing Date, Sellers shall deliver to Buyer a good faith estimate of the Closing Date Net Working Capital (the “Estimated Working Capital”), which shall be prepared in accordance with GAAP, consistently applied (the “Accounting Principles”). For purposes of calculating the Closing Payment, if the Estimated Working Capital: (x) is less than the Target Net Working Capital, then the amount to be paid by Buyer at the Closing shall be reduced by the amount of such difference, or (y) is greater than the Target Net Working Capital, then the amount to be paid by Buyer at the Closing shall be increased by the amount of such difference.

1.3 Working Capital Statement.

(a) As promptly as practicable after the Closing, but in no event more than 90 days after the Closing, Buyer shall prepare and deliver to Sellers a statement setting forth the calculation of the Closing Date Net Working Capital (the “Closing Date Statement of Net Working Capital”). The Closing Date Statement of Net Working Capital shall be prepared in accordance with the Accounting Principles and in the same manner and form as the calculation of the Estimated Working Capital and from the books and records of the Ritter Companies, on a consolidated basis.

(b) During the 30-day period following delivery by Buyer of the Closing Date Statement of Net Working Capital, Buyer shall make available to Sellers and their authorized representatives during normal business hours the work papers used by Buyer in preparing the Closing Date Statement of Net Working Capital and shall promptly furnish to Sellers such other information with respect to the preparation of the Closing Date Statement of Net Working Capital as Sellers or their representatives may from time to time reasonably request. 

(c) Sellers shall have 30 days following receipt of the Closing Date Statement of Net Working Capital to notify Buyer of any disputes or objections concerning the Closing Date Statement of Net Working Capital, specifying in reasonable detail the nature and amount of such disputes or objections (the “Notice of Dispute”). Items and amounts in the Closing Date Statement of Working Capital to which no objection is made in the Notice of Dispute shall be final and binding upon the parties. If Sellers do not deliver a Notice of Dispute to Buyer within such 30-day period, the Closing Date Statement of Net Working Capital shall be considered to have been accepted by Sellers and shall be final and binding. In the event Sellers deliver a Notice of Dispute to Buyer, Buyer and Sellers shall attempt to resolve the disputed matters as promptly as possible.

(d) If Buyer and Sellers are unable to resolve all disputed matters identified in the Notice of Dispute, if any, within 30 days after delivery of the Notice of Dispute to Buyer, the remaining disputed matters shall be resolved by Grant Thornton LLP (or such other accounting firm as Buyer and Sellers mutually may designate) (the “Independent Accounting Firm”). The determination by the Independent Accounting Firm shall be final and binding upon the parties, and the Closing Date Statement of Net Working Capital shall be adjusted accordingly. The Independent Accounting Firm shall be instructed to address only the remaining disputed items or amounts and to use reasonable efforts to complete its review and make all necessary determinations within 30 days after submission of the Closing Date Statement of Net Working Capital and the Notice of Dispute to it. The Closing Date Statement of Net Working Capital, as modified by resolution of any disputes in accordance with this Section 1.3(d) or, if applicable, as accepted by Sellers pursuant to Section 1.3(c), shall be the “Final Statement of Net Working Capital.” The fees and expenses of the Independent Accounting Firm shall be shared equally by Sellers and Buyer.

1.4 Final Adjustment of Purchase Price.

(a) If the Purchase Price as calculated using the Closing Date Net Working Capital set forth in the Final Statement of Net Working Capital exceeds the Closing Payment, Buyer shall, within five Business Days after the Final Statement of Net Working Capital becomes final pursuant to Section 1.3, pay to Sellers the amount by which the Final Consideration exceeds the Closing Payment. If the Purchase Price as calculated using the Closing Date Net Working Capital set forth in the Final Statement of Net Working Capital is less than the Closing Payment, Sellers shall, within five Business Days after the Final Statement of Net Working Capital becomes final pursuant to Section 1.3, pay to Buyer the amount by which Purchase Price is less than the sum of the Closing Payment.

(b) No interest shall be payable with respect to any payment made pursuant to this Section 1.4 if such payment is made when due. If any such payment is not made when due, commencing on the next day, interest shall accrue thereon at a rate per annum equal to the Citibank, N.A. prime rate. Such rate shall change as the Citibank, N.A. prime rate changes, and interest shall be calculated on the basis of a year of 360 days. Payments pursuant to this Section 1.4 shall be made by wire transfer of immediately available funds in U.S. dollars to an account designated by the intended recipient, such designation to be made in writing at least two Business Days prior to the payment.

1.5 Allocation of Purchase Price. The aggregate Purchase Price payable to the Sellers will be allocated among and paid to the Sellers as set forth on Exhibit A hereto.

Article II - CLOSING MATTERS

2.1 Closing. The closing of the purchase and sale of the Equity Interests contemplated by this Agreement (the “Closing”) will take place concurrently with the signing of this Agreement by exchanging faxed or e-mailed copies of signed documents. The date of the Closing is the “Closing Date” and the Closing will be deemed effective as of 11:59 p.m. local time on September ___, 2019 (the “Effective Time”).

2.2 Conditions to Buyer’s Obligations. The obligation of Buyer to consummate the transactions contemplated by this Agreement on the Closing Date is subject to the satisfaction of each of the following conditions:

(a) Consents. The Sellers will have obtained and delivered to Buyer all required third party consents, including the consents set forth on Schedule 2.2(a).

(b) Release of Liens. The Sellers will have obtained releases of all Liens, other than Permitted Liens and the Liens set forth on Schedule 2.2(b), on the assets of each Company and the Equity Interests. The Sellers will have delivered such payoff letters, discharges of Liens, releases of guarantees and other releases as are reasonably requested by Buyer at or prior to Closing.

(c) Closing Documents. At the Closing, the Sellers will have delivered, or will have caused to be delivered, to Buyer, all of the following documents:

(i) a certificate from the Secretary of each Company certifying the Organizational Documents of the Company;

(ii) a Certificate of Good Standing for each Company from the applicable Secretary of State;

(iii) the leases, in the form attached hereto as Exhibits C-1, C-2, and C-3, each executed by the landlord party thereto (collectively, the “Restated Leases”);

(iv) employment agreements, in the form attached hereto as Exhibit D, executed by Matthew Ritter and Michael Ritter, respectively (the “Employment Agreements”);

(v) certificates or other documents representing the Equity Interests, as well as such stock powers or similar transfer documentation as shall be reasonably requested by Buyer;

(vi) written resignations of the officers and members of the board of directors of each Company, each duly executed by the appropriate parties;

(vii) the original record and minute books, equity ledgers and registers, and company seals, if any, of each Company;

(viii) a certificate of non-foreign status of the Sellers meeting the requirements of Treasury Regulation Section 1.1445-2(b)(2);

(ix) such other documents relating to the transactions contemplated by this Agreement as Buyer may reasonably request prior to Closing.

2.3 Conditions to the Sellers’ Obligations. The obligation of the Sellers to consummate the transactions contemplated by this Agreement on the Closing Date is subject to Buyer’s delivery to the Sellers copies of the following:

(i) resolutions duly adopted by Buyer’s board of directors authorizing the execution, delivery and performance of this Agreement,

(ii) the Restated Leases executed by Buyer;

(iii) the Employment Agreements executed by Buyer;

(iv) all other agreements or instruments contemplated hereby and the consummation of the transactions contemplated hereby.

Article III – COVENANTS

3.1 Sales and Transfer Taxes. All sales, use, excise, value-added, goods and services, transfer, recording, documentary, registration, conveyancing and similar Taxes that may be incurred in connection with this Agreement, together with any and all penalties, interest, and additions to Tax with respect thereto will be paid by Buyer.

3.2 Further Assurances. In case at any time after the Closing any further action is necessary to carry out the purposes of this Agreement, each of the Parties will take such further action (including the execution and delivery of such further instruments and documents) as any other Party reasonably may request, all at the cost and expense of the requesting Party.

3.3 Administration of Accounts. All payments and reimbursements received by the Sellers or any entity controlled by Sellers after the Closing Date from any third party in the name of either Company will be held by the Sellers or such entity in trust for the benefit of Buyer. Immediately upon receipt of such payment or reimbursement, the Sellers will pay to Buyer the amount of such payment or reimbursement without right of set-off, offset, or reduction of any kind.

3.4 Confidentiality. Each Seller agrees that Seller will not use, or permit the use of, any of the information relating to the Business, or relating to Buyer or Buyer’s Affiliates, furnished to such Seller in connection with the transactions contemplated herein (“Information”) in a manner or for a purpose detrimental to Buyer or Buyer’s Affiliates, or otherwise than in connection with the transaction, and that it will not disclose, divulge, provide or make accessible (collectively, “Disclose” or “Disclosure”), or permit any other Person to Disclose, any of the Information to any individual or entity, other than its investment advisors, accountants, counsel and other authorized representatives and agents, except as may be required by judicial or administrative process or, in the opinion of his counsel, by other requirements of Law; provided, however, that prior to any Disclosure of any Information permitted hereunder, the Sellers will first obtain the recipients’ undertaking to comply with the provisions of this Section 3.4 with respect to such Information.

3.5 Non-Competition; Non-Solicitation; Non-Hire. As additional consideration for Buyer’s entry into this Agreement and consummation of the transactions contemplated hereby, and with the acknowledgement by the Sellers that Buyer would not enter into this Agreement without the benefit of the provisions set forth in this Section 3.5, each Seller agrees that the following restrictions on such Seller’s activities following the Closing Date are necessary, appropriate and reasonable to protect the Business and other legitimate interests of Buyer and its Affiliates:

(a) Non-Competition. For a period of five (5) years immediately following the Closing Date (the “Restricted Period”), each Seller agrees that such Seller will not, anywhere in the U.S., directly or indirectly, on behalf of any Person other than Buyer or its Affiliates, invest in, own, manage, operate, finance, control, advise, render services as an employee, independent contractor, or otherwise, or guarantee the obligations of any Person engaged in or planning to become engaged in the Business, or any business engaged in by Buyer or its Affiliates; provided, however, that the ownership of less than two percent (2%) of the outstanding stock of any publicly traded company will not by itself be deemed to be a violation of this provision.

(b) Non-Solicitation. During the Restricted Period, each Seller will not, directly or indirectly, solicit the business of any Person who is a customer of the Business, or of Buyer or its Affiliates, or cause, induce, or attempt to cause or induce, any customer, supplier, licensee, licensor, franchisee, employee, consultant or other business relation of Buyer or its Affiliates to cease doing business with such parties, to deal with any competitor of Buyer or its Affiliates, or in any way interfere with its relationship with such parties, all of the foregoing as it relates to the Business.

(c) Non-Hire. During the Restricted Period, each Seller will not, directly or indirectly, on behalf of any Person other than Buyer or its Affiliates, solicit, hire or engage in any capacity any employee of Buyer or its Affiliates (or any person or entity who was an employee of Buyer or its Affiliates within 12 months of the date such hiring or engagement occurs) or solicit or seek to persuade any employee of Buyer or its Affiliates to discontinue such employment.

(d) Modification of Covenant. If a final judgment of a court or tribunal of competent jurisdiction determines that any term or provision contained in this Section 3.5 is invalid or unenforceable, then the Parties agree that the court or tribunal will have the power to reduce the scope, duration or geographic area of the term or provision, to delete specific words or phrases or to replace any invalid or unenforceable term or provision with a term or provision that is valid and enforceable and that comes closest to expressing the intention of the invalid or unenforceable term or provision. This Section 3.5 will be enforceable as so modified.

(e) Enforcement of Covenant. The Parties agree that the remedy of damages at law for the breach of any of the covenants contained in this Section 3.5 is an inadequate remedy. In recognition of the irreparable harm that a violation by the Sellers of any of the covenants, agreements or obligations arising under this Section 3.5 would cause Buyer or its Affiliates, the Sellers agree that in addition to any other remedies or relief afforded by law, a preliminary and permanent injunction against an actual or threatened violation or violations may be issued against the Sellers without showing actual monetary damages or posting of a bond or other security. In the event of an action to enforce the covenants in this Section 3.5, the prevailing Party will be entitled to be reimbursed by the other Party for reasonable attorney’s fees and other expenses incurred by the prevailing Party with respect to such enforcement action; provided, however, Buyer will be entitled to be reimbursed by the Sellers in the event a Seller challenges the enforceability or reasonableness of any of the provisions of this Section 3.5. Each of Buyer’s Affiliates will have the right to enforce the Sellers’s obligations set forth in this Section 3.5. In addition, in the event any Seller violates any provisions of this Section 3.5, then, in such event the period of the violation will be added to the Restricted Period set forth in such section.

3.6 Certain Tax Matters.

(a) Tax Returns. The Sellers will prepare, or cause to be prepared, and file, or cause to be timely filed, all Tax Returns for the Companies for all Tax periods ending on or prior to the Closing Date (such Tax Returns constituting the “Pre-Closing Tax Returns”). The Sellers will timely pay all Taxes due with respect to all Pre-Closing Tax Returns. The Sellers will provide any unfiled Pre-Closing Tax Returns to Buyer for review at least ten (10) Business Days prior to filing, and the Sellers will reflect any reasonable comments made by Buyer on such Tax Returns. Notwithstanding the foregoing, the Sellers will not cause the Companies to extend or amend any Tax Returns with respect to any Tax period ending on or prior to the Closing Date without the prior written consent of Buyer. Buyer will prepare and timely file, or cause to be prepared and timely filed, all Tax Returns required to be filed by the Companies for all Tax periods beginning after the Closing Date. Buyer will timely pay all Taxes due with respect to all Tax periods beginning after the Closing Date, except that Sellers shall be responsible for that portion of any Taxes due for a Straddle Period as provided in Section 3.6(b).

(b) Straddle Period. In the case of any taxable period that includes (but does not end on) the Closing Date (a “Straddle Period”), (i) the amount of any Taxes based on or measured by income, gain, payroll, or receipts of the Companies for the Pre-Closing Tax Period will be determined based on an interim closing of the books as of the close of business on the Closing Date (with any net operating losses being first applied to the interim period ending on the Closing Date (to the extent available under applicable Law) and, therefore, first inuring to the benefit of the Sellers); and (ii) the amount of other Taxes of the Companies for a Straddle Period that relates to the Pre-Closing Tax Period will be deemed to be the amount of such Tax for the entire taxable 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. The Sellers will timely pay all Taxes relating to that portion of the Straddle Period up to and including the Closing Date. Buyer will timely pay all Taxes relating to that portion of the Straddle Period after the Closing Date. If any Tax is due from the Sellers with respect to the portion of the Straddle Period ending on the Closing Date, the Sellers shall be provided with a copy of the applicable Tax Return and Buyer’s calculation and documentation of the Sellers’ portion of the Tax due. Buyer will prepare and timely file, or cause to be prepared and timely filed, all Tax Returns required to be filed by the Companies for any Straddle Period.

(c) Cooperation; Audit. After the Closing Date, Buyer and the Sellers will, and will cause their respective Affiliates to, cooperate in the preparation of all Tax Returns of the Companies and will provide, or cause to be provided, to the requesting Party any records or other information requested by such Party in connection therewith. The Sellers, on the one hand, and Buyer, on the other hand, will give prompt notice to each other of any proposed adjustment to Taxes for the Pre-Closing Tax Period or the Straddle Period. Promptly upon receipt by either Party of any notification or indication (whether written or oral) from any taxing authority that it intends to investigate or audit any Tax Return of the Companies for any Tax period ending on or prior to the Closing Date, the Party receiving such information will notify the other Party and convey such information to the other Party in writing. Each Party will cooperate with the other in connection with any Tax investigation, Tax audit, or other Tax proceeding; provided, however, Buyer will be entitled to represent the Companies on any Tax investigation, Tax audit, or other Tax proceeding that arises after the Closing Date provided Buyer will allow the Sellers to reasonably participate at the Sellers’ own cost and expense to the extent such matter could reasonably result in an indemnification claim against the Sellers pursuant to this Agreement. A Party will be reimbursed for reasonable out-of-pocket expenses incurred in taking any action reasonably requested by the other Party or Parties under this Section 3.6(c); provided, however, that the foregoing will not alter any indemnification rights to which the Parties are entitled under this Agreement.

3.7 Release by Sellers. Effective as of the Closing, in consideration of the mutual covenants and agreements contained herein, including the consideration to be received by the Sellers, each Seller hereby irrevocably releases and forever discharges each Company, and their respective Affiliates, officers, managers, directors, members, partners (general or limited), agents, and employees, and the successors, heirs, assigns, executors and administrators to the foregoing (collectively, the “Released Parties”), of and from any and all manner or causes of action and actions, claims, suits, rights, debts, sums of money, covenants, contracts, damages and judgments whatsoever, in law or in equity, which the Sellers ever had, now has or which the Sellers can, shall or may have, against the Released Parties, whether known or unknown, suspected or unsuspected, matured or unmatured, fixed or contingent, for, upon or by reason of any matter relating to the Companies or their Affiliates, and arising at any time on or prior to the Closing Date, whether in the Seller’s capacity as an equityholder, director, manager, officer, employee, holder of Indebtedness or otherwise, and the Released Parties shall not have liability with respect thereto, provided, however, that such release shall not will not apply to obligations owing to the Sellers arising pursuant to the Transaction Documents.

3.8 Release by Companies. Effective as of the Closing, in consideration of the mutual covenants and agreements contained herein, each of the Released Parties hereby irrevocably releases and forever discharges each Seller, and their respective Affiliates, partners (general or limited), agents, and employees, and the successors, heirs, assigns, executors and administrators to the foregoing (collectively, the “Seller Released Parties”), of and from any and all manner or causes of action and actions, claims, suits, rights, debts, sums of money, covenants, contracts, damages and judgments whatsoever, in law or in equity, which the Released Parties ever had, now has or which the Released Parties can, shall or may have, against the Seller Released Parties, whether known or unknown, suspected or unsuspected, matured or unmatured, fixed or contingent, for, upon or by reason of any matter relating to the Companies or their Affiliates, and arising at any time on or prior to the Closing Date.

3.9 D&O Claims. Notwithstanding anything herein to the contrary elsewhere in this Agreement, each Seller hereby agrees that he will not make any claim for indemnification against Buyer, Buyer Indemnified Parties, or either Company by reason of the fact that he was a controlling person, manager, director, officer, or representative of the Company.

Article IV - REPRESENTATIONS AND WARRANTIES OF
THE Sellers

The Sellers jointly and severally represent and warrant to Buyer that the statements contained in this Article IV are true and correct with respect to each Company respectively as of the date hereof except as set forth in the corresponding schedule of the disclosure schedules attached hereto (the “Disclosure Schedules”).

4.1 Organization and Qualification. The Company is a duly organized, validly existing corporation in good standing under the Laws of the state of its incorporation. The Company has all the requisite power, authority, and capacity to own, lease, and operate its assets and to carry on the Business as the same was and is now being conducted. The Company is qualified to transact business as a foreign entity and is in good standing under the Laws of each jurisdiction in which the nature of its business or the ownership or leasing of its properties requires such qualification, except where the failure to so qualify has not and would not reasonably be expected to have a Material Adverse Effect on the Company. The Sellers have heretofore delivered to Buyer complete and correct copies of the Company’s Organizational Documents now in effect, and the Company is not in default under or in violation of any provision of its Organizational Documents.

4.2 Power and Authority; Enforceability. The Sellers have all power and authority to enter into and consummate the transactions contemplated by this Agreement and any ancillary agreements (the “Transaction Documents”) to which they are a party. The execution and delivery of the Transaction Documents by the Sellers and the consummation of the transactions contemplated by the Transaction Documents to which the Sellers are a party have been duly authorized by all necessary action on the part of each Seller. The Transaction Documents have been duly executed and delivered by the Sellers, and such Transaction Documents constitute the legal, valid and binding obligations of each Seller, enforceable against each Seller in accordance with their respective terms, except to the extent that (a) their enforceability may be limited by applicable bankruptcy, insolvency, reorganization, or other Laws affecting the enforcement of creditor’s rights generally, and (b) the availability of equitable remedies is subject to the discretion of the court before which any such proceeding may be brought.

4.3 No Conflict. Neither the execution and delivery of this Agreement nor the performance of the provisions hereof or the transactions contemplated hereby: (a) violate or conflict with the Company’s Organizational Documents; (b) materially violate or conflict with any Law, rule, regulation, writ, judgment, injunction, decree, determination, award or other order of any court, government or governmental agency or instrumentality, domestic or foreign, that is applicable to the Company; or (c) except as set forth on Schedule 4.3, will result in a material breach of any of the terms or conditions of, or constitute a material default under, any mortgage, note, bond, indenture, agreement, license or other instrument or obligation to which the Company or any Seller is a party or by which any of their respective properties or assets may be bound or affected. Except as set forth on Schedule 4.3, the execution, delivery and performance of this Agreement and the consummation of the transactions contemplated hereby do not require any material authorization, consent, permission, waiver, approval, exemption or other material action by or notice to any Governmental Entity or other third party, under any Material Contract or Governmental Contract to which the Company is bound, or any law, statute, rule or regulation or order, judgment or decree to which the Company is subject.

4.4 Capitalization. The capitalization of the Company is as set forth on Schedule 4.4. The Equity Interests set forth on Schedule 4.4 constitute all of the outstanding Equity Interests of the Company and are validly issued, fully paid and non-assessable. There are (i) no outstanding subscriptions, options, calls, Contracts, commitments, understandings, restrictions, arrangements, rights or warrants, including any rights plan, and any right of conversion or exchange under any outstanding security, instrument or other agreement, obligating any Company to issue, deliver or sell, or cause to be issued, delivered or sold, additional equity interests of any Company, respectively, or obligating the Company to grant, extend or enter into any such agreement or commitment, and (ii) no voting trusts, proxies or other agreements or understandings to which the Company or the Sellers are a party or are bound with respect to the voting of any of the Equity Interests of the Company. Each Seller has good and valid title to and beneficial ownership in the Equity Interests set forth on Schedule 4.4 and such Equity Interests are free and clear of all Liens. Except as set forth on Schedule 4.4, the Company has no equity interest in any direct or indirect subsidiary.

4.5 Financial Statements; Undisclosed Liabilities and Defaults.

(a) The Company has delivered to Buyer the unaudited balance sheets of the Company as of December 31, 2018 and December 31, 2017 and the related statements of income, stockholders’ equity and cash flows for the fiscal years then ended. All of the foregoing financial statements are collectively referred to herein as the “Financial Statements.” The Financial Statements have been prepared in accordance with GAAP and fairly present, in all material respects, the financial condition and results of operation of the Company at the dates and for the periods indicated therein, except as otherwise may be indicated therein. The Company’s accounting practices have been consistently applied for all periods represented by the Financial Statements, except as otherwise may be indicated therein.

(b) The Company’s books of account and financial records are true and correct in all material respects and have been prepared and are maintained in accordance with sound accounting practice. The Financial Statements have been prepared and presented based upon and in conformity with such books of account and financial records.

(c) Except as set forth on Schedule 4.5(c) or as and to the extent adequately accrued or reserved against in the unaudited balance sheet of the Company as of December 31, 2018, the Company does not have any Liability, Indebtedness or obligation which would be required by GAAP to be reflected in a balance sheet of the Company prepared in accordance with GAAP or disclosed in the notes thereto, except for liabilities and obligations, incurred in the ordinary course of business consistent with past practice since December 31, 2018.

4.6 Intentionally Omitted.

4.7 Compliance with Laws.

(a) The Company is in compliance in all material respects with all applicable Laws with respect to the Business.

(b) The Company holds all material permits, approvals, registrations, franchises, licenses, certificates, accreditations and other authorizations of all Governmental Entities (the “Permits”) required for the conduct of the Business and all such Permits are set forth on Schedule 4.7. The Company has complied with and is in compliance with the terms and conditions of such Permits in all material respects. The Company has not received any notices that it is in material violation of any of the terms or conditions of such Permits. The Company has taken all reasonable action to maintain such Permits. No loss or expiration of any such Permit is pending or threatened other than expiration in accordance with the terms thereof. Except as set forth on Schedule 4.7, the Permits owned or used by the Company immediately prior to the Closing will be available for use by Buyer on the same terms and conditions immediately subsequent to the Closing.

4.8 Claims. Except as set forth on Schedule 4.8 and except for claims covered by insurance or otherwise made in the ordinary course of business, there are no claims, actions, suits, inquiries, proceedings (including any arbitration proceedings), judgments, orders, awards, decrees, or investigations, pending or, to the Knowledge of the Company, threatened against the Company or any officer, director or employee thereof, or any Seller, in each case relating to the Business.

4.9 Title to Assets; Sufficiency. Except as set forth on Schedule 4.9, the Company holds good and marketable title to all of its property and assets, free and clear of any Liens, except Permitted Liens. No Person other than the Company has any right or interest in the assets of the Company, including the right to grant interests in the assets to third parties. The assets owned or leased by the Company are all those assets necessary to conduct the Business as presently conducted and will allow Buyer to continue to operate the Business in substantially the same manner immediately following the Closing Date. The equipment, machinery, fixtures, vehicles, computer hardware and furniture owned, leased or used by the Company is in good repair and operating condition (subject to ordinary wear and tear), and is suitable for the purposes for which it is used, and has been maintained in all material respects in accordance with the applicable manufacturer’s suggested maintenance procedures. All accounts and notes receivable of the Company represent amounts receivable for goods actually delivered or services actually provided (or in the case of notes and non-trade receivables, represent amounts in respect of other bona fide business transactions), to the Knowledge of the Company, are not subject to any defenses, counterclaims or rights of set off, have been billed and are generally due and payable within 30 days after billing, and subject to reasonable write-offs consistent with the prior experience of the company, will be fully collectible in the Ordinary Course of Business.

4.10 Indebtedness and Guarantees. Except as set forth on Schedule 4.10, the Company has no Indebtedness, and the Company does not guarantee the Indebtedness of any third party. Schedule 4.10 accurately states the outstanding balance of all Indebtedness as of the Closing Date. The sale of the Equity Interests pursuant to this Agreement is made in exchange for fair and equivalent consideration. The transactions contemplated by this Agreement and the agreements referenced in this Agreement will not give rise to any right of any creditor of the Company to accelerate the due date or alter the repayment terms of any Indebtedness of the Company. The transactions contemplated in this Agreement or any agreements referenced in this Agreement will not give rise to any right of any creditor of the Sellers whatsoever against Buyer or to any of the Equity Interests in the hands of Buyer after the Closing.

4.11 Material Contracts. Schedule 4.11 contains a complete and accurate list of all Material Contracts to which the Company is a party. Except as set forth on Schedule 4.11, (a) the Company has performed in all material respects the obligations required to be performed by it to date under its Material Contracts, and, (b) to the Knowledge of the Sellers there are no defaults by any other party thereto, and, (c) to the Knowledge of the Sellers, no event has occurred (or failed to occur) that, with the passing of time or the giving of notice or both would constitute a default by the Company under any such Material Contract, including the consummation of the transactions contemplated by this Agreement and no permission, waiver or approval is required to be obtained from any third party in order to preserve for Buyer the benefits of the Material Contracts after the consummation of the transaction contemplated by this Agreement. Each Material Contract is in full force and effect and constitutes a legal, valid, binding agreement of the Company except to the extent that such enforcement may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or other similar laws now or hereafter in effect relating to creditors’ rights generally, and except that the remedy of specific performance and injunctive and other forms of equitable relief may be subject to equitable defenses and to the discretion of the court before which any proceeding therefor may be brought. Buyer has been supplied with, or been provided access to, a true and correct copy of all written Material Contracts and true and correct written summaries of all oral Material Contracts.

4.12 Government Contracts and Government Bids.

(a) Schedule 4.12 contains a complete and accurate list of each Government Contract the period of performance of which has not yet expired or been terminated (each, a “Current Government Contract”). The Company has delivered to or provided Buyer access to complete and correct copies of each Current Government Contract. Each Current Government Contract was legally awarded to the Company. Each Current Government Contract is valid, binding and in full force and effect and enforceable against the Company in accordance with its terms except to the extent that such enforcement may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or other similar laws now or hereafter in effect relating to creditors’ rights generally, and except that the remedy of specific performance and injunctive and other forms of equitable relief may be subject to equitable defenses and to the discretion of the court before which any proceeding therefor may be brought.

(b) (i) The Company is not in material breach of or default under any Current Government Contract, and, to the Knowledge of the Company, no event has occurred which, with the giving of notice or the lapse of time or both, would constitute such a breach or default by the Company; (ii) the Company is in compliance in all material respects with the Federal Acquisition Regulation (“FAR”), Cost Accounting Standards, Service Contract Act of 1963, as amended (including requirements for paying applicable Service Contract Act wage rate and fringe benefit rates), the Truth in Negotiations Act, and the Anti-Kickback Act, in each case where and as applicable to each Current Government Contract or Government Bid; (iii) since January 1, 2016, each representation and certification made by the Company in connection with a Government Contract or Government Bid was current, accurate and complete in all material respects as of its effective date, and the Company has complied in all material respects with the terms of all Government Contracts; (iv) there are no outstanding or pending claims, requests for equitable adjustment or contract disputes in excess of $100,000 arising under or relating to a Government Contract or Government Bid; and (v) no Current Government Contract or Government Bid is currently the subject of any bid protest before any Governmental Entity.

(c) Since January 1, 2016, (i) neither the Company nor any Seller (as defined in FAR 52.209-5) has been debarred, suspended or excluded from participation in, or the award of, Government Contracts or doing business with any Governmental Entity, no suspension, debarment, or exclusion action has been commenced or threatened against the Company or any of its officers or employees, and there exist no circumstances that require the Company to answer any of the questions in FAR 52.209-5 in the affirmative; (ii) no Governmental Entity under a Government Contract has notified the Company of any breach or violation of any applicable Law or of any certification, representation, clause, provision or requirement of any such Government Contract; (iii) the Company has not received any notice of termination for default, cure notice or show cause notice pertaining to any Government Contract; (iv) the Company has not received any notice of an unresolved significant weakness or deficiency with respect to the cost accounting system of the Company; (v) the Company has not received written notice from any Governmental Entity or other counterparty to a Government Contract that the counterparty to such Government Contract (A) has ceased or will cease to be a customer of the Company, (B) intends to terminate or materially modify (including by materially decreasing the rate or amount of services obtained from the Company) any Government Contract, (C) intends to change the type of contracting vehicle for the services provided pursuant to such Government Contract in a manner that may preclude the Company from continuing to provide such services or (D) seeks to convert any Government Contract that establishes an exclusive or single source purchasing arrangement or relationship between such counterparty and the Company into a non-exclusive or multi-source arrangement or relationship; and (vi) the Company has not made any voluntary or mandatory disclosures to any Governmental Entity with respect to any material misstatement, significant overpayment or violation of applicable Law arising under or relating to any Government Contract or Government Bid, nor has any violation occurred for which the Company is required to make any such disclosure to a Governmental Entity.

(d) Since January 1, 2016, the Company has not been the subject or target of any audit, subpoena, investigation, prosecution or administrative proceeding related to any Government Contract or Government Bid. Since January 1, 2016, the Company has not received any written or oral notice of any pending or threatened audit, subpoena, investigation, prosecution or administrative proceeding related to any Government Contract or Government Bid.

4.13 Insurance. The Company is currently insured by insurers unaffiliated with the Company with respect to its properties, its assets and the operation of the Business in such amounts and against such risks as are appropriate and customary for the type of business conducted by the Company with customary deductibles and retained amounts and which insurance policies are set forth on Schedule 4.13. In addition, to the Knowledge of the Sellers, the Company has maintained adequate insurance for all prior periods with respect to the Business. With respect to each insurance policy held by the Company (a) the policy is legal, valid, binding and in full force and effect; and (b) the Company is not in default under any insurance policy held by the Company. The Company is not in default under any insurance policy held by the Company. All premiums under such insurance policies which are due and payable have been paid in full and the Company has not received notice of any material increase in the premium under, or the cancellation or non-renewal of, any such policy.

4.14 Intellectual Property. Set forth on Schedule 4.14 is a list and brief description of patents, patent rights, patent applications, trademarks, trademark applications and registrations, trade dress, proprietary rights, service marks, service mark applications, trade names, social media accounts and registrations, domain names and copyrights owned by or registered in the name of the Company and used in the Business, or, except with respect to commercially available off-the-shelf software (“COTS”), of which the Company is a licensor or licensee or in which the Company has any right, and in each case a brief description of the nature of such right. Except for payments made for the license of COTS, the Company is not subject to any obligation, including any license or royalty obligation, relating to any product or service of the Business that the Company now markets or has marketed in the three past years. Except as set forth on Schedule 4.14, the Company owns all rights in, or possesses adequate licenses or other rights to use, all patents, patent applications, trademarks, trademark applications and registrations, trade dress, service marks, service mark applications and registrations, proprietary rights, trade names, social media accounts and registrations, domain names, copyrights, manufacturing processes, batch tickets, designs, website content, formulae, technology, molds, trade secrets and know how necessary to conduct the Business as conducted prior to Closing (collectively, “Intellectual Property”). To the Knowledge of the Sellers, the Intellectual Property does not infringe or conflict upon the right of any third party, and to the Knowledge of the Sellers there has not been, and are, no infringing uses by third parties of the Intellectual Property owned by the Company. No Seller owns or has any interest in the Intellectual Property used by the Company in connection with the Business. No past or present employee or independent contractor (including consultants) of the Company has any ownership interest, license, permission or other right in or to any Intellectual Property, ideas, inventions, processes, works of authorship and other work products that relate to the Business, that were conceived, created, authored or developed, in whole or in part, by such employee or independent contractor.

4.15 Real Property. The Company does not, directly or indirectly, own any real property, nor has it ever owned any real property. Schedule 4.15 sets forth the address of each parcel of real estate leased by the Company (“Leased Real Property”), a true and complete list of all leases for each such Leased Real Property, and the amount of security deposit for each such Leased Real Property. The Company has not collaterally assigned or granted any other security interest in any Leased Real Property or any interest therein. Except as set forth on Schedule 4.15, each Contract for Leased Real Property is legal, valid, binding, enforceable and in full force and effect, and the Company’s possession and quiet enjoyment of the Leased Real Property under such lease has not been disturbed, and there are no disputes with respect to such lease. Except as set forth on Schedule 4.15, neither the Company nor any other party to the lease is in breach or default under such lease, and no event has occurred or circumstance exists which, with the delivery of notice, the passage of time or both, would constitute such a breach or default, or permit the termination, modification or acceleration of rent under such lease.

4.16 Labor Matters. The Company is in compliance in all material respects with all Laws with respect to employment and employment practices, terms and conditions of employment and wages and hours (including the Employee Retirement Income Security Act of 1974, as amended, and the Contract Service Act, as amended), including requirements for paying applicable Service Contract Act wage rate and fringe benefit rates, and the Company is not engaged in any unfair labor practice and has not been threatened with a possible claim for any such practice. The Company has properly classified its employees and independent contractors. Except as set forth in Schedule 4.16, the Company is not, and has not been for the past five years, a party to, bound by, or negotiating any collective bargaining agreement or other Contract with a union, works council or labor organization (collectively, “Union”), and there is not, and has not been for the past five years, any Union representing or purporting to represent any employee of the Company, and no Union or group of employees is seeking or has sought to organize employees for the purpose of collective bargaining. Except as set forth in Schedule 4.16, there has never been, nor has there been any threat of, any strike, slowdown, work stoppage, lockout, concerted refusal to work overtime or other similar labor disruption or dispute affecting the Company or any of its employees. The Company has no duty to bargain with any Union.

4.17 Tax Matters. Schedule 4.17 contains a list of states, territories, and jurisdictions (whether foreign or domestic) in which the Company files Tax Returns. The Company has filed all Tax Returns that it was required to file. All such filed Tax Returns were true, correct, and complete. Except as set forth on Schedule 4.17, all Taxes due and payable prior to Closing by the Company have been paid. The Company has withheld and paid all Taxes required to have been withheld and paid in connection with amounts paid or owing to any employee. There are no Liens on any of the assets of the Company that arose in connection with any failure (or alleged failure) to pay any Tax. The Company has not received any notice from any Governmental Entity that it is subject to an audit or investigation that could result in the payment of additional Taxes. The Company is not a party to any Tax allocation, sharing, indemnity or similar agreement. The Company has no Liability for the Taxes of any Person, as a transferee or successor, by Contract, or otherwise.

4.18 Absence of Certain Developments. Since January 1, 2019, except with respect to cash distributions to the Sellers, the Company has conducted its business in the ordinary course of business consistent with past practice.

4.19 Related Party Transactions. Except as set forth on Schedule 4.19, the Company is not currently a party to any Related Party Transaction in connection with the Business and has not been a party to any such Related Party Transaction since January 1, 2017.

4.20 Safety Rating. Except as set forth on Schedule 4.20, the Company has an overall “Satisfactory” safety rating, and maintained Compliance, Safety and Accountability scores (“CSA Scores”) below the “alert” threshold in each of the seven categories assessed by the DOT in connection therewith. To the Knowledge of the Sellers, there are no issues, deficiencies or violations which would adversely affect such safety rating or CSA Scores. Neither any Seller nor the Company has received any written or other notice of any intended, pending or proposed audit of the Business by the DOT or any other Governmental Entity having jurisdiction over the Company’s operation of the Business.

4.21 Intentionally Omitted.

4.22 Brokerage and Finder’s Fees. Neither the Company nor any Seller has incurred and neither the Company nor any Seller will incur any brokerage, finder, or similar fee in connection with the transactions contemplated by the Transaction Documents to which any of them are a party.

4.23 Vendors. The Company provided Buyer accurate and complete lists of the names and addresses of the 10 largest vendors of the Business from whom the Company has purchased either supplies or inventories for the past two fiscal years (ended December 31, 2018 and December 31, 2017).

4.24 Environmental Matters.

(a) The Company is in compliance in all material respects with all applicable Environmental Laws. The Company holds and has timely applied for renewal of all permits or other authorizations under Environmental Laws that are required for (i) the occupancy, use and operation of its properties and assets, and (ii) the operation and conduct of such Company and the Business.

(b) The Company has not received any outstanding and unresolved written or oral notices, reports, or other information regarding any actual or alleged violation of Environmental Laws by the Company, or any Liabilities or potential Liabilities, including any remedial obligations, arising under Environmental Laws and relating to the Company or its properties. There are no pending or threatened, claims, Liens, or other restrictions of any nature, resulting from any violation or failure to comply with any applicable Environmental Law, with respect to or affecting any of the properties currently occupied, used or operated by the Company. There are no present or past actions, activities, circumstances, conditions, facts, events or incidents, including without limitation, the Release or threatened Release or presence of any Hazardous Substances, which could form the basis for any litigation against the Company or that could result in the imposition of any Liability on the Company, in each case under Environmental Laws.

(c) No facts, events, or conditions relating to the past or present properties or operations of the Company will prevent, hinder, or limit the Company’s continued compliance with Environmental Laws, or give rise to any remedial obligations or material Liability of the Company pursuant to Environmental Laws. During or prior to the period of (i) the Company’s occupancy, use or operation of any property, or (ii) the Company’s participation in the management of any property, there were no Releases or threatened Releases of any Hazardous Substances in, on, under or affecting any such property, and the Company has not placed, held, located, Released, transported or disposed of any Hazardous Substances on, under, from or at any such property or any other property other than in compliance with applicable Environmental Laws. Except as set forth on Schedule 4.24(c), no above ground or underground storage tanks, asbestos-containing materials, lead-based paint, toxic mold or polychlorinated biphenyls are or have been present at any property currently or formerly leased or operated by the Company. The Company has not sent or disposed of Hazardous Substances to or at a site which, pursuant to the Comprehensive Environmental Response, Compensation, and Liability Act (42 U.S.C. § 9601 et seq.), or any similar state, federal or foreign law, has been listed or proposed for listing on the “National Priorities List” or its state equivalent.

(d) The Company has delivered to Buyer correct and complete copies of all environmental studies or reports (including, but not limited to, any Phase I or Phase II reports and compliance audits), pleadings, analytical data, monitoring data, permits required under Environmental Laws, and other material records and correspondence concerning Environmental Laws relating to the occupancy, use and operation of its properties and the operation of the Business that are in the possession or reasonable control of the Sellers.

4.25 Employee Benefit Plans. Set forth on Schedule 4.25 is a complete list of all pension, profit sharing, retirement, stock purchase, stock option, bonus, incentive compensation and deferred compensation plans, life, health, dental, accident or disability, workers’ compensation or other employee welfare benefit plans (insured or self-insured), educational assistance, pre-tax premium or flexible spending account plans, supplemental or executive benefit plans, non-qualified retirement plans, severance or separation plans, and any other employee benefit plans, practices, policies or arrangements of any kind, whether written or oral, which are currently maintained by the Company for the benefit of any of their respective employees (including former employees), or under which the Company has any current or potential Liability with respect to any employee or former employee or the dependents of any such person, including any “employee benefit plan” which is subject to the Employee Retirement Income Security Act of 1974, as amended (“ERISA”) (herein collectively referred to as “Employee Benefit Plans” and individually as an “Employee Benefit Plan”). All Employee Benefit Plans comply in form and in operation in all material respects with their terms, the applicable requirements of ERISA, the Code and all applicable Laws. The Company has complied in all material respects with the terms of all Employee Benefit Plans and related Contracts. Buyer has been supplied with or been provided access to a true and correct copy of all written Employee Benefit Plans and true and correct written summaries of all oral Employee Benefit Plans. With respect to the Employee Benefit Plans, no event has occurred and, there exists no condition or set of circumstances, in connection with which the Company could be subject to any Liability (other than for routine claims for benefits in the ordinary course) under the terms of the Employee Benefit Plans or any applicable Law. The Company does not sponsor or participate in (i) a pension plan that is subject to Title IV of ERISA, Section 302 of ERISA or Section 412 of the Code, (ii) a “multi-employer pension plan,” as defined in Section 3(37) of ERISA, (iii) a “multiple employer welfare arrangement,” as defined in Section 3(40) of ERISA, (iv) a “multiple employer plan,” as defined in Section 413 of the Code, (v) a “welfare benefits trust” or “voluntary employees beneficiary association,” as defined in Sections 419, 419A or 501(c)(9) of the Code, or (vi) a plan or arrangement providing for post-employment health or life insurance coverage, except as otherwise required by Section 4980B of the Code or similar state Laws and at the sole expense of the individual.

4.26 Accounts; Powers of Attorney. Schedule 4.26 sets forth a correct and complete list of all accounts or safe deposit boxes at any bank or other financial institution of the Company, and the names of all Persons authorized to draw thereon or have access thereto. Except as set forth on Schedule 4.26, no Person holds a power of attorney to act on behalf of the Company.

Article V- REPRESENTATIONS AND WARRANTIES OF BUYER

Buyer represents and warrants to the Sellers that the statements contained in this Article V are true and correct as of the date hereof:

5.1 Organization and Qualification. Buyer is a corporation duly incorporated, validly existing and in good standing under the Laws of Delaware. Buyer is qualified to transact business as a foreign entity and is in good standing under the Laws of each jurisdiction in which the nature of its business or the ownership or leasing of its properties requires such qualification, except where the failure to so qualify has not and would not reasonably be expected to have a Material Adverse Effect on Buyer.

5.2 Power and Authority; Enforceability. Buyer has all requisite corporate power and authority to enter into and consummate the transactions contemplated by the Transaction Documents to which Buyer is a party. The execution and delivery by Buyer of the Transaction Documents to which it is a party and the consummation of the transactions contemplated thereby have been duly authorized by all necessary action on the part of Buyer. The Transaction Documents have been duly executed and delivered by Buyer and constitute the legal, valid and binding obligations of Buyer, enforceable against Buyer in accordance with their respective terms, except to the extent that (a) their enforceability may be limited by applicable bankruptcy, insolvency, reorganization or other Laws affecting the enforcement of creditor’s rights generally, and (b) the availability of equitable remedies is subject to the discretion of the court before which any such proceeding may be brought.

5.3 No Conflict. Neither the execution and delivery of this Agreement nor the performance of the provisions hereof or the transactions contemplated hereby: (a) violate or conflict with Buyer’s Organizational Documents; (b) materially violate or conflict with any Law, rule, regulation, writ, judgment, injunction, decree, determination, award or other order of any court, government or governmental agency or instrumentality, domestic or foreign, that is applicable to Buyer; or (c) will result in a material breach of any of the terms or conditions of, or constitute a material default under, any mortgage, note, bond, indenture, agreement, license or other instrument or obligation to which Buyer is a party or by which any of its respective properties or assets may be bound or affected. The execution, delivery and performance of this Agreement and the consummation of the transactions contemplated hereby do not require any material authorization, consent, approval, exemption or other material action by or notice to any Governmental Entity or other third party, under any Material Contract or Governmental Contract to which the Company is bound, or any law, statute, rule or regulation or order, judgment or decree to which the Company is subject.

5.4 Brokerage and Finder’s Fees. Buyer has not incurred and will not incur any brokerage, finder, or similar fee in connection with the transactions contemplated by the Transaction Documents to which it is a party.

5.5 Investment Intent. Buyer is acquiring the Equity Interests for its own account for investment purposes only and not with a view to any public distribution thereof or with any intention of selling, distributing or otherwise disposing of the Equity Interests in a manner that would violate the registration requirements of the Securities Act of 1933, as amended (the “Securities Act”). Buyer agrees that the Equity Interests may not be sold, transferred, offered for sale, pledged, hypothecated or otherwise disposed of without registration under the Securities Act and any applicable state securities laws, except pursuant to an exemption from such registration under the Securities Act and such laws. Buyer is able to bear the economic risk of holding the Equity Interests for an indefinite period (including total loss of its investment), and (either alone or together with its Representatives) has sufficient knowledge and experience in financial and business matters so as to be capable of evaluating the merits and risk of its investment.

5.6 Buyer's Investigation and Reliance. Buyer is a sophisticated purchaser and has made its own investigation, review and analysis regarding the Companies and the transactions contemplated hereby, which investigation, review and analysis were conducted by Buyer together with expert advisors that it has engaged for such purpose. Buyer and its Representatives have been provided with full and complete access to the Representatives, properties, offices, plants and other facilities, books and records of the Company and its Subsidiaries and other information that they have requested in connection with their investigation of the Companies and the transactions contemplated hereby. Buyer is not relying on any statement, representation or warranty, oral or written, express or implied, made by the Sellers or their Affiliates or Representatives with respect to the Companies, except as expressly set forth in Article IV and the Disclosure Schedules. Neither the Sellers nor any of their Affiliates or Representatives shall have any liability to Buyer or any of its Affiliates or Representatives resulting from the use of any information, documents or materials made available to Buyer, whether orally or in writing, in any confidential information memoranda, “data rooms”, management presentations, due diligence discussions or in any other form in expectation of the transactions contemplated by this Agreement. Neither the Sellers nor any of their Affiliates or Representatives is making, directly or indirectly, any representation or warranty with respect to any estimates, projections or forecasts involving the Companies. Buyer acknowledges that there are inherent uncertainties in attempting to make such estimates, projections and forecasts and that it takes full responsibility for making its own evaluation of the adequacy and accuracy of any such estimates, projections or forecasts (including the reasonableness of the assumptions underlying any such estimates, projections and forecasts). Buyer acknowledges that, should the Closing occur, Buyer shall acquire the Companies without any representation or warranty as to merchantability or fitness for any particular purpose of their respective assets, on an “as is” and “where is” basis, except as expressly set forth in Article IV and the Disclosure Schedules. Buyer has no Knowledge or reason to believe that any of the representations or warranties made by the Sellers as of the date hereof are untrue, incomplete or inaccurate. Nothing in this Section 5.6 is intended to modify or limit any of the representations or warranties of the Sellers set forth in Article IV.

Article VI - INDEMNIFICATION

6.1 Survival of Representations, Warranties, Covenants and Agreements. The representations, warranties, covenants and agreements in this Agreement and the Disclosure Schedules attached hereto or in any writing delivered by any Party to any of the other Parties in connection with this Agreement will survive (a) for a period of 18 months after the Closing Date for representations and warranties except as set forth in subparts (b), (b) indefinitely for the representations and warranties set forth in Sections 4.1, 4.2, 4.4, and 4.17 (collectively, the “Fundamental Representations”), (c) indefinitely for claims based on fraud, (d) indefinitely for all covenants and agreements that by their terms contemplate performance after the Closing Date, unless specified otherwise by their terms, or (e) the statute of limitations plus thirty (30) days for all other claims. Notwithstanding the above, so long as written notice of a claim is given on or prior to the expiration of survival period, such claim will continue to survive until such matter is resolved.

6.2 Indemnification by the Sellers. The Sellers agree to indemnify, defend and hold harmless Buyer and its Affiliates, directors, managers, officers, equityholders, members, partners, and their respective successors and assigns (the “Buyer Indemnified Parties”) from, against and in respect of any Losses imposed on, sustained, incurred or suffered by or asserted against any of Buyer Indemnified Parties directly or indirectly, whether or not due to a third-party claim, arising out of or resulting from:

(a) a breach of any representation or warranty of Sellers made in this Agreement;

(b) a breach of any covenant or agreement of any Seller made in this Agreement;

(c) any unpaid Taxes of either Company; and

(d) any Outstanding Transaction Expenses of either Company.

6.3 Indemnification by Buyer. Buyer agrees that it will indemnify, defend, and hold harmless the Sellers and their Affiliates, partners, and their respective successors and assigns (the “Seller Indemnified Parties”), from, against and in respect of any and all Losses imposed on, sustained, incurred or suffered by or asserted against any of the Seller Indemnified Parties directly or indirectly, whether or not due to a third-party claim, arising out of or resulting from:

(a) any breach of any representation or warranty of Buyer made in this Agreement; and

(b) a breach of any covenant or agreement of Buyer made in this Agreement.

6.4 Procedures.

(a) In order for a Buyer Indemnified Party or Seller Indemnified Party (the “Indemnified Party”) to be entitled to any indemnification provided for under this Agreement as a result of a Loss or a claim or demand made by any Person against the Indemnified Party (a “Third Party Claim”), such Indemnified Party shall deliver notice thereof to the party against whom indemnity is sought (the “Indemnifying Party”) promptly after receipt by such Indemnified Party of written notice of the Third Party Claim, describing in reasonable detail the facts giving rise to any claim for indemnification hereunder, the amount or method of computation of the amount of such claim (if known) and such other information with respect thereto as the Indemnifying Party may reasonably request. The failure to provide such notice, however, shall not release the Indemnifying Party from any of its obligations under this Article VI except to the extent that the Indemnifying Party is prejudiced by such failure.

(b) The Indemnifying Party shall have the right, upon written notice to the Indemnified Party within 30 days of receipt of notice from the Indemnified Party of the commencement of such Third Party Claim, to assume the defense thereof at the expense of the Indemnifying Party with counsel selected by the Indemnifying Party and reasonably satisfactory to the Indemnified Party. If the Indemnifying Party assumes the defense of such Third Party Claim, the Indemnified Party shall have the right to employ separate counsel and to participate in the defense thereof, but the fees and expenses of such counsel shall be at the expense of the Indemnified Party. If the Indemnifying Party assumes the defense of any Third Party Claim, the Indemnified Party shall cooperate with the Indemnifying Party in such defense and make available to the Indemnifying Party all witnesses, pertinent records, materials and information in the Indemnified Party’s possession or under the Indemnified Party’s control relating thereto as is reasonably required by the Indemnifying Party. Whether or not the Indemnifying Party assumes the defense of a Third Party Claim, the Indemnified Party shall not admit any liability with respect to, or settle, compromise or discharge, or offer to settle, compromise or discharge, such Third Party Claim without the Indemnifying Party’s prior written consent, (which consent shall not be unreasonably withheld).

(c) In the event any Indemnified Party should have a claim against any Indemnifying Party hereunder that does not involve a Third Party Claim being asserted against or sought to be collected from such Indemnified Party, the Indemnified Party shall deliver notice of such claim promptly to the Indemnifying Party, describing in reasonable detail the facts giving rise to any claim for indemnification hereunder, the amount or method of computation of the amount of such claim (if known) and such other information with respect thereto as the Indemnifying Party may reasonably request. The failure to provide such notice, however, shall not release the Indemnifying Party from any of its obligations under this Article VI except to the extent that the Indemnifying Party is prejudiced by such failure. The Indemnified Party shall reasonably cooperate and assist the Indemnifying Party in determining the validity of any claim for indemnity by the Indemnified Party and in otherwise resolving such matters. Such assistance and cooperation shall include providing reasonable access to and copies of information, records and documents relating to such matters, furnishing employees to assist in the investigation, defense and resolution of such matters and providing legal and business assistance with respect to such matters.

6.5 Limits on Indemnification.

(a) No claim may be asserted against either party for breach of any representation, warranty or covenant contained herein, unless written notice of such claim is received by such party, describing in reasonable detail the facts and circumstances with respect to the subject matter of such claim on or prior to the date on which the representation, warranty or covenant on which such claim is based ceases to survive as set forth in Section 6.1, in which case such representation, warranty or covenant shall survive as to such claim until such claim has been finally resolved.

(b) Notwithstanding anything to the contrary contained in this Agreement:

(i) the maximum aggregate amount of indemnifiable Losses that may be recovered from the Sellers by Buyer Indemnified Parties pursuant to Section 6.2 shall be an amount equal to 15% multiplied by the aggregate total Base Consideration paid by the Seller for the acquisition of all of the Ritter Companies (the “Cap”); provided that any Losses resulting from breaches by the Seller of any of the Fundamental Representations shall not be subject to the Cap and such Losses shall not count towards satisfaction of the Cap; provided further, that the aggregate amount of all indemnifiable Losses that may be recovered from the Seller by Buyer Indemnified Parties pursuant to Section 6.2 (including with respect to any Losses resulting from breaches of any Fundamental Representation) shall not exceed the Purchase Price, as adjusted pursuant to Section 1.4;

(ii) the Seller shall not be liable to any Buyer Indemnified Party for any claim for indemnification unless and until the aggregate amount of indemnifiable Losses that may be recovered from the Seller equals or exceeds an amount equal to 0.75% multiplied by the aggregate total Base Consideration paid by the Seller for the acquisition of all of the Ritter Companies (the “Basket Amount”), in which case the Seller shall be liable only for the Losses in excess of the Basket Amount; provided, however, that no Losses may be claimed by any Buyer Indemnified Party or shall be reimbursable by the Seller or shall be included in calculating the aggregate Losses for purposes of this clause (ii) other than Losses in excess of $25,000 (the “Minimum Loss Amount”) resulting from any single claim or aggregated claims arising out of the same facts, events or circumstances;

(iii) in determining whether any claim for indemnification under this Agreement or any of the other Ritter Company Acquisition Agreements exceeds the Cap and/or the Basket Amount, the amount of all such claims under all of the Ritter Company Acquisition Agreements shall be aggregated;

(iv) any payment for Losses claimed by any Buyer Indemnified Party shall be paid by the Sellers as follows (x) 70% of such Losses shall be paid in cash and (y) 30% of such Losses shall be paid by the surrender of Buyer common stock (valued at no less than the value assigned to such common stock under any of the Ritter Company Acquisition Agreements); provided that the Sellers may elect, at their sole option, to pay such Losses in cash only;

(v) the Seller shall not be obligated to indemnify any Buyer Indemnified Party with respect to any Loss to the extent that a specific accrual or reserve for the amount of such Loss was reflected on the Financial Statements or the notes thereto;

(vi) the Seller shall not be obligated to indemnify any Buyer Indemnified Party with respect to any Loss to the extent that the Buyer received a benefit from the reflection of such matter in the calculation of the adjustment of the Purchase Price, if any, as finally determined pursuant to Section 1.4;

(vii) no party hereto shall have any liability under any provision of this Agreement for any punitive, incidental, consequential, special or indirect damages, including business interruption, loss of future revenue, profits or income, or loss of business reputation or opportunity relating to the breach or alleged breach of this Agreement; and

(viii) in the event Buyer proceeds with the Closing notwithstanding actual knowledge by the Buyer or any Affiliate of Buyer at or prior to the Closing of any breach by the Seller of any representation, warranty or covenant in this Agreement, no Buyer Indemnified Party shall have any claim or recourse against the Seller or any of its Affiliates or Representatives with respect to such breach, under this Article VI or otherwise.

(c) For all purposes of this Article VI, “Losses” shall be net of (i) any insurance or other recoveries payable to the Indemnified Party or its Affiliates in connection with the facts giving rise to the right of indemnification and (ii) any Tax benefit available to such Indemnified Party or its Affiliates arising in connection with the accrual, incurrence or payment of any such Losses (including, without limitation, the net present value of any Tax benefit arising in subsequent taxable years).

(d) Buyer and the Sellers shall cooperate with each other with respect to resolving any claim, liability or Loss for which indemnification may be required hereunder, including by making, or causing the applicable Indemnified Party to make, all reasonable efforts to mitigate any such claim, liability or Loss. In the event that Buyer or the Sellers shall fail to make such reasonable efforts, then notwithstanding anything else to the contrary contained herein, the other party shall not be required to indemnify any Person for any claim, liability or Loss that could reasonably be expected to have been avoided if such efforts had been made. Without limiting the generality of the foregoing, Buyer and the Sellers shall, or shall cause the applicable Indemnified Party to, use reasonable efforts to seek full recovery under all insurance policies covering any Loss to the same extent as they would if such Loss were not subject to indemnification hereunder.

6.6 Assignment of Claims. If any Buyer Indemnified Party receives any payment from the Seller in respect of any Losses pursuant to Section 8.2 and the Buyer Indemnified Party could have recovered all or a part of such Losses from a third party (a "Potential Contributor") based on the underlying claim asserted against the Seller, the Buyer Indemnified Party shall assign, on a non-recourse basis and without any representation or warranty, such of its rights to proceed against the Potential Contributor as are necessary to permit the Seller to recover from the Potential Contributor the amount of such payment. If any such assignment would afford the Potential Contributor any defense to the payment of the same, such assignment shall not take place and the Buyer Indemnified Party will, at the Seller's direction and expense, take all reasonable actions to seek to recover such claim from such Potential Contributor. Any payment received in respect of such claim against the Potential Contributor (whether by the Seller or the relevant Buyer Indemnified Party as provided in the immediately preceding sentence) shall be distributed, (i) first, to the Buyer Indemnified Party in the amount of any deductible or similar amount required to be paid by the Buyer Indemnified Party prior to the Seller being required to make any payment to the Buyer Indemnified Party plus, in the case of any claim by a Buyer Indemnified Party as provided in the immediately preceding sentence, the costs and expenses incurred in investigating, prosecuting, defending or otherwise addressing such claim, (ii) second, to the Seller in an amount equal to the aggregate payments made by the Seller to the Buyer Indemnified Party in respect of such claim, plus the costs and expenses incurred in investigating, prosecuting, defending or otherwise addressing such claim and (iii) the balance, if any, to the Buyer Indemnified Party.

6.7 Exclusivity. Except as specifically set forth in this Agreement, effective as of the Closing, in the absence of fraud by the Sellers (to the extent determined by a final judgment by a court of competent jurisdiction), Buyer, on behalf of itself and the other Buyer Indemnified Parties, waives any rights and claims any Buyer Indemnified Party may have against the Sellers, whether in law or equity, relating to the Companies and/or the transactions contemplated hereby. The rights and claims waived by Buyer, on behalf of itself and the other Buyer Indemnified Parties, include, without limitation, claims for contribution or other rights of recovery arising out of or relating to any Environmental Laws, claims for breach of contract, breach of representation or warranty, negligent misrepresentation and all other claims for breach of duty. After the Closing, subject to the foregoing, this Article VI will provide the exclusive remedy against the Sellers for any breach of any representation, warranty, covenant or other claim arising out of or relating to this Agreement and/or the transactions contemplated hereby.

6.8 Tax Treatment of Indemnity Payments. All payments made pursuant to any indemnification obligations under this Agreement, will be treated as adjustments to the Purchase Price for Tax purposes and such agreed treatment will govern for purposes of this Agreement, unless otherwise required by applicable Laws.

6.9 Offset. Buyer will have the right to set off the indemnification obligations of the Sellers pursuant to this Article VI against any other payments, if any, due to the Sellers, whether under this Agreement or any other agreement among the Parties. No set off shall be permitted unless either (a) the Sellers have agreed in writing that it is liable for the relevant Losses or (b) if disputed, there has been a final, non-appealable award granting the relevant Buyer Indemnified Party such Losses.

Article VII- MISCELLANEOUS PROVISIONS

7.1 Expenses. The Parties will each bear their own costs and expenses relating to the negotiation and the implementation of the transactions contemplated hereby, including, without limitation, fees and expenses of legal counsel, accountants, investment bankers, brokers or finders, printers, copiers, consultants or other representatives, whether or not such transactions are consummated.

7.2 Amendment and Modification; Waivers, Third-Party Beneficiary. This Agreement may be amended, or any provision of this Agreement may be waived upon the approval, in a writing, executed by Buyer and the Sellers. This Agreement will not confer any rights or remedies upon any Person other than the Parties and their respective successors and permitted assigns, other than: (i) the Released Parties, who are intended third-party beneficiaries of the provisions set forth in Section 3.7, and (ii) the Buyer Indemnified Parties and Seller Indemnified Parties, who are intended third-party beneficiaries of the provisions set forth in Article VI. Any waiver or consent will be effective only in the specific instance and for the specific purpose for which it is given.

7.3 Notices. All notices, requests, demands and other communications required or permitted hereunder will be made in writing and will be deemed to have been duly given and effective: (a) on the date of delivery, if delivered personally; (b) on the first Business Day following the date of dispatch if delivered by a recognized next-day courier service; or (c) on the earlier of the fourth (4^th) day after mailing or the date of the return receipt acknowledgment, if mailed, postage prepaid, by certified mail, return receipt requested. All notices hereunder must be delivered to the following addresses:

If to Sellers:

Matthew L. Ritter

10313 Princeton Circle

Ellicott City, MD 21042

and

Michael J. Ritter

908 Glouster Circle

Hampstead, MD 21074

With copies to the following, which will not constitute notice:

Offit Kurman P.A.

4800 Montgomery Lane

9^th Floor

Bethesda, MD 20814

Attn: Michael Mercurio; Brent Salmons

If to Buyer or Parent:

EVO Transportation & Energy Services, Inc.

Attn: John Yeros, CEO

8285 West Lake Pleasant Parkway

Peoria, AZ 85382

With copies to the following, which will not constitute notice:

Fredrikson & Byron, P.A.

200 South Sixth Street, Suite 4000

Minneapolis, MN 55402-1425

Attn: Frank B. Bennett; Patrick Seul

7.4 Assignment. This Agreement and all of the provisions hereof will be binding upon and inure to the benefit of the Parties hereto and their respective successors and permitted assigns, except that neither this Agreement nor any of the rights, interests or obligations under this Agreement may be assigned or delegated by any Party without the prior written consent of the other Parties, which consent will not be unreasonably withheld. Notwithstanding the foregoing, (i) Buyer may assign in whole or in part its rights pursuant to this Agreement to one or more of their Affiliates, (ii) Buyer may assign this Agreement and its rights and obligations under this Agreement in connection with a merger or consolidation involving Buyer, or in connection with a sale of substantially all of the equity or assets of Buyer or other disposition of substantially all of the Business provided the assignment will not relieve Buyer of its obligations pursuant to this Agreement, and (iii) Buyer may assign any or all of its rights pursuant to this Agreement or the Transaction Documents, including its rights to indemnification, to any of its lender(s) as collateral security.

7.5 Governing Law; Jurisdiction; Waiver of Jury Trial. This Agreement and the legal relations among the Parties hereto will be governed by and construed in accordance with the internal substantive Laws of the State of Delaware (without regard to the Laws of conflict that might otherwise apply) as to all matters, including without limitation matters of validity, construction, effect, performance and remedies. Each of the Parties hereto irrevocably submits to the exclusive jurisdiction of the courts of the State of Delaware and of the United States located in Delaware, for the purposes of any such action or other proceeding arising out of this Agreement or any transaction contemplated hereby. EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY PROCEEDING (WHETHER BASED IN CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR RELATING TO THIS AGREEMENT, THE OTHER TRANSACTION DOCUMENTS OR ANY TRANSACTION OR AGREEMENT CONTEMPLATED HEREBY OR THE ACTIONS OF ANY PARTY HERETO IN THE NEGOTIATION, ADMINISTRATION, PERFORMANCE OR ENFORCEMENT HEREOF. The Buyer and the Sellers specifically represent and warrant that they were represented by legal counsel and obtained legal advice regarding this Section 7.5 and other provisions of this Agreement.

7.6 Counterparts. This Agreement may be executed simultaneously with original, facsimile, or .pdf signatures in one or more counterparts, each of which will be deemed an original, but all of which together will constitute one and the same instrument.

7.7 Headings. The headings of the sections and subsections of this Agreement are inserted for convenience only and will not constitute a part hereof.

7.8 Entire Agreement. This Agreement and the exhibits and other writings referred to in this Agreement or any such exhibit or other writing are part of this Agreement, together embody the entire agreement and understanding of the Parties hereto in respect of the transactions contemplated by this Agreement. This Agreement supersedes all prior agreements and understandings between the Parties with respect to the transaction or transactions contemplated by this Agreement.

7.9 Severability. Provisions of this Agreement will be interpreted to be valid and enforceable under applicable Law to the extent that such interpretation does not materially alter this Agreement; provided, however, that if any such provision will become invalid or unenforceable under applicable Law such provision will be stricken to the extent necessary and the remainder of such provisions and the remainder of this Agreement will continue in full force and effect.

7.10 Cumulative Remedies; Specific Performance. All rights and remedies of a Party hereto are cumulative of each other and of every other right or remedy such Party may otherwise have at law or in equity, and the exercise of one or more rights or remedies will not prejudice or impair the concurrent or subsequent exercise of other rights or remedies. Each Pary will expressly be entitled to specific performance as a remedy.

7.11 Publicity. No Party will issue any press release or make any other public statement relating to the transactions contemplated hereby unless (a) agreed to by the other Parties hereto, or (b) required by Law or court order and any such release or statement will be subject to prior review by the other Parties hereto.

[Signature Page Follows]

IN WITNESS WHEREOF, the Parties hereto have caused this Stock Purchase Agreement to be duly executed as of the day and year first above written.

Signature Page to Stock Purchase Agreement

EXHIBIT A

Sellers

EXHIBIT B

DEFINITIONS

As used in this Agreement, the following terms will have the meanings indicated below.

“Affiliate” of any specified Person means any other Person directly or indirectly controlling or controlled by or under direct or indirect common control with such specified Person. For the purposes of this definition, “Control” or “Controlling” or “Controlled by” will mean, when used with respect to any specified Person, the power to direct the management and policies of such Person, directly or indirectly, whether through the ownership of voting securities, by Contract or otherwise.

“Business Day” means any day other than Saturday or Sunday on which banks are open for business in Phoenix, Arizona.

“Closing Date Net Working Capital” means, as of the Effective Time, the Current Assets minus the Current Liabilities, calculated in accordance with the Accounting Principles,

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

“Contracts” means all oral or written contracts, agreements, instruments and other documents to which a Person is a party or by which it or its assets is or are bound.

“Current Assets” means the current assets of the Ritter Companies, calculated in accordance with the Accounting Principles, and on a consolidated basis.

“Current Liabilities” means the current liabilities of the Ritter Companies, calculated in accordance with the Accounting Principles, and on a consolidated basis.

“DOT” means the United States Department of Transportation.

“Environmental Law” means all Laws: (a) relating to pollution (or the cleanup thereof) or the protection of natural resources, endangered or threatened species, or the environment (including ambient air, soil, surface water or groundwater, or subsurface strata); or (b) concerning the presence of, exposure to, or the management, manufacture, use, containment, storage, recycling, reclamation, reuse, treatment, generation, discharge, transportation, processing, production, disposal, or remediation of any Hazardous Substances. The term “Environmental Law” includes the following (including their implementing regulations, any state analogs or any similar laws in foreign jurisdictions): the Comprehensive Environmental Response, Compensation, and Liability Act of 1980, as amended by the Superfund Amendments and Reauthorization Act of 1986, 42 U.S.C. §§ 9601 et seq.; the Solid Waste Disposal Act, as amended by the Resource Conservation and Recovery Act of 1976, as amended by the Hazardous and Solid Waste Amendments of 1984, 42 U.S.C. §§ 6901 et seq.; the Federal Water Pollution Control Act of 1972, as amended by the Clean Water Act of 1976, as amended, 15 U.S.C. §§ 2601 et seq.; the Emergency Planning and Community Right to Know Act of 1986, 42 U.S.C. §§ 11001 et seq.; and the Clean Air Act of 1966, as amended by the Clean Air Act Amendments of 1990, 42 U.S.C. §§ 7401 et seq.

“GAAP” means U.S. generally accepted accounting principles, consistently applied.

“Government Bid” means any outstanding bid, offer or proposal which, if accepted or successful, would result in a Current Government Contract.

“Government Contract” means any prime contract, subcontract, purchase order, task order, delivery order, basic ordering agreement, pricing agreement, teaming agreement, letter contract, joint venture or other similar written arrangement between the Company, on the one hand, and (i) any Governmental Entity or (ii) any higher-tier contractor of a Governmental Entity in its capacity as a higher-tier contractor, on the other hand. A purchase order, a task order or a delivery order under a Government Contract shall not constitute a separate Government Contract, for purposes of this definition, but shall be part of the Government Contract to which it relates.

“Governmental Entity” means any court, administrative agency or commission, self-regulatory organization or other foreign, domestic, or quasi-governmental authority or instrumentality.

“Hazardous Substances” means all hazardous substances, as that term is defined in the Comprehensive Environmental Response, Compensation, and Liability Act (42 U.S.C. § 9601 et seq.), solid waste, hazardous waste and any other individual or class of pollutants, contaminants, toxins, chemicals, substances, wastes or materials in their solid, liquid or gaseous phase, defined, regulated, classified or identified under any Environmental Law, including without limitation petroleum, petroleum products, friable asbestos, molds, urea formaldehyde, radioactive materials and polychlorinated biphenyls.

“Indebtedness” means, with respect to any Person at any date, without duplication: (a) all obligations of such Person for borrowed money or in respect of loans or advances; (b) all obligations of such Person evidenced by bonds, debentures, notes or other similar instruments; (c) all obligations in respect of letters of credit, whether or not drawn, and bankers’ acceptances issued for the account of such Person; (d) all capital lease liabilities of such Person determined in accordance with GAAP; (e) all guarantees of such Person in connection with any of the foregoing; (f) any debt-like obligation or financing-type arrangement in respect of the deferred purchase price of property or property received as of the Closing with respect to which such Person is liable, contingently or otherwise, as obligor or otherwise; (g) any accrued interest, prepayment premiums or penalties or other costs or expenses related to any of the foregoing; and (h) all obligations or indebtedness of the Company owed to any Seller.

“Insider” means (a) any officer, director, or owner of the Company; (b) any individual related by blood, marriage or adoption to any individual listed in clause (a) hereof; or (c) any Person in which any individual listed in clauses (a) or (b) hereof has a beneficial interest.

“Knowledge” means the actual knowledge of such Person after reasonable inquiry, and “Knowledge” as it is applied to the Company, means the actual knowledge of Matthew Ritter and Michael Ritter, after reasonable inquiry.

“Law” means any federal, state, local, municipal, foreign, international, multinational, or other administrative order, constitution, law, ordinance, principle of common law, regulation, statute, or treaty.

“Liability” or “Liabilities” means any liability or obligation of whatever kind or nature (whether known or unknown, whether asserted or unasserted, whether absolute or contingent, whether accrued or unaccrued, whether liquidated or unliquidated, and whether due or to become due), including any liability for Taxes.

“Lien” means any mortgage, pledge, deed of trust, assignment, lien, charge, encumbrance, judgment, pledge or security interest of any kind or nature whatsoever or any claim of right of any third-party, or the interest of a vendor or lessor under any conditional sale Contract, capital lease or other title retention Contract.

“Losses” means any and all losses, Liabilities, damages, fees, direct and indirect damages (excluding consequential and incidental damages, lost profits, and punitive damages unless owed to a third party), and costs and expenses (including costs of investigation and defense and reasonable fees and expenses of lawyers, experts and other professionals).

“Material Adverse Effect” means any event, change, circumstance, occurrence, effect or state of facts that is or could reasonably be expected to be materially adverse to the business, assets, liabilities, condition (financial or otherwise), results of operations, or prospects of the Business.

“Material Contract” means:

(i) each Contract of the Company involving aggregate consideration in excess of $250,000;

(ii) all Contracts that require the Company to purchase its total requirements of any product or service from a third party or that contain “take or pay” provisions;

(iii) [intentionally omitted];

(iv) all Contracts that relate to the acquisition or disposition of any business, a material amount of stock or assets of any other Person or any real property (whether by merger, sale of stock, sale of assets or otherwise);

(v) all broker, distributor, dealer, manufacturer’s representative, franchise, agency, sales promotion, market research, marketing consulting and advertising Contracts to which the Company is a party;

(vi) all employment agreements and Contracts with independent contractors or consultants (or similar arrangements) that are not terminable by the Company on 60 days’ notice or less;

(vii) except for Contracts relating to trade receivables, all Contracts relating to Indebtedness;

(viii) all Government Contracts;

(ix) all Contracts that limit or purport to limit the ability of the Company to compete in any line of business or with any Person or in any geographic area or during any period of time;

(x) any Contracts to which the Company is a party that provide for any joint venture, partnership or similar arrangement by the Company;

(xi) all Contracts between or among the Company on the one hand and any Seller or any Affiliate of a Seller on the other hand;

(xii) all collective bargaining agreements or Contracts with any Union to which the Company is a party; and

(xiii) any other Contract that is material to the Company and not previously disclosed pursuant to subparts (i) – (xii).

“Ordinary Course of Business” means the ordinary course of the Business, consistent with past practice, including with regard to nature, frequency, and magnitude.

“Organizational Documents” means the articles or certificate of incorporation, bylaws, limited liability company agreement, partnership agreement or other governing documents of an entity.

“Outstanding Transaction Expenses” means fees and expenses incurred by the Companies or the Sellers on or prior to the Closing relating to the negotiation, execution and delivery of this Agreement and the other Transaction Documents.

“Permitted Liens” means (a) liens for current Taxes, assessments or other claims by a Governmental Entity not yet delinquent or the amount or validity of which is being contested in good faith by appropriate proceedings; (b) mechanics’, carriers’, workers’, repairers’ and similar Liens arising or incurred in the ordinary course of business that are not material to the Business; and (c) such other imperfections in title, charges, restrictions, or Liens that do not, individually or in the aggregate, materially detract from or diminish the value of or materially interfere with the present ownership, use and operation of such asset as used in the Business.

“Person” means any individual, corporation, partnership, joint venture, limited liability company, trust, unincorporated organization, Governmental Entity, or other legally recognized entity.

“Pre-Closing Tax Period” means any Tax period ending on or prior to the Closing Date and the portion of any Straddle Period up to and including the Closing Date.

“Related Party Transaction” means any Contract, arrangement, or understanding under which a Company or its Insiders (a) has borrowed any monies from or has outstanding any indebtedness or other similar obligations to the Company or its Affiliates; (b) owns any direct or indirect interest of any kind in, or is a director, officer, member, employee, partner, equity owner, consultant or lender to, or borrower from, or has the right to participate in the management, operations or profits of, any Person which is (i) a competitor, supplier, customer, distributor, lessor, tenant, creditor or debtor of a Company, or (ii) participates in any transaction to which a Company is a party; or (c) is or has been a party to any Contract, arrangement, understanding or transaction with a Company.

“Release” or “Released” will have the meaning specified in 42 U.S.C. § 9601.

“Ritter Companies” means the Companies (i.e. Ritter Transportation Systems, Inc. and Ritter Transport, Inc.), John W. Ritter, Inc., and Johmar Leasing Company, LLC.

“Ritter Company Acquisition Agreements” means, collectively, this Agreement and the other agreements entered into between the Parties on the same date hereof pursuant to which the Buyer is acquiring from the Sellers the other Ritter Companies.

“Target Net Working Capital” means One Million Four Hundred Seven Thousand Three Hundred Nineteen Dollars ($1,407,319.00).

“Tax Return” means all returns, declarations, reports, statements, computations and other documents required to be filed with any Governmental Entity in respect of Taxes.

“Taxes” means federal, state, county, local, foreign or other income, gross receipts, ad valorem, franchise, profits, sales or use, transfer, registration, excise, utility, environmental, communications, real or personal property, membership interest, license, payroll, wage or other withholding, employment, social security, severance, stamp, occupation, alternative or add-on minimum, estimated and other taxes of any kind whatsoever (including deficiencies, penalties, additions to tax, and interest attributable thereto) whether disputed or not.

EXHIBIT C-1

RESTATED LEASE

[See attached.]

EXHIBIT C-2

RESTATED LEASE

[See attached.]

EXHIBIT C-3

RESTATED LEASE

[See attached.]

EXHIBIT D

Form of Employment Agreement

[See attached.]

Exhibit 2.3

MEMBERSHIP INTEREST PURCHASE AGREEMENT

This MEMBERSHIP INTEREST PURCHASE Agreement (this “Agreement”) is made effective as of September 16, 2019, by and among EVO Holding Company, LLC, a Delaware limited liability company (“Buyer”), EVO Transportation & Energy Services, Inc., a Delaware corporation (“Parent”), and the stockholders listed on Exhibit A hereto (each, individual, a “Seller” and, collectively, the “Sellers”). Buyer and the Sellers may be referred to individually in this Agreement as a “Party” and collectively as the “Parties.” Capitalized Terms used herein and not otherwise defined have the meanings given to such terms in Exhibit B attached hereto. Parent joins this Agreement solely to guaranty (a) the payment of any indemnification obligations of Buyer, and (b) the performance by Buyer of Buyer’s covenants set forth in this Agreement.

RECITALS

A. The Sellers own all of the issued and outstanding equity interests (collectively, the “Equity Interests”) of Johmar Leasing Company, LLC (the “Company”).

B. The Company owns vehicles and related assets for lease to freight trucking companies (the “Business”).

C. The Parties desire to enter into this Agreement whereby the Sellers propose to sell to Buyer, and Buyer proposes to purchase from the Sellers, all of the Equity Interests, such that Buyer will become the sole equity owner of the Company.

D. Each Seller will receive substantial financial benefit from the transaction set forth in this Agreement and understand that being parties to certain sections of this Agreement (including Section 3.5) is a condition to Buyer entering into this Agreement.

AGREEMENTS

In consideration of the representations, warranties, covenants, agreements, and conditions set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereby agree as follows:

Article I - SALE AND PURCHASE OF THE EQUITY INTERESTS

1.1 Exchange of Equity Interests. Subject to the terms and conditions set forth herein, at the Closing, each Seller shall sell and deliver to Buyer, and Buyer shall purchase from each Seller, the Equity Interests set forth next to such Seller’s name on Exhibit A, free and clear of all Liens, for the consideration specified in Section 1.2.

1.2 Purchase Price; Payment.

(a) The aggregate purchase price to be paid by Buyer to the Sellers (the “Purchase Price”) will be an aggregate of Five Hundred Thousand Dollars and Zero Cents ($500,000.00) (the “Base Consideration”). In addition, Buyer will pay off aggregate Indebtedness of the Company in the amount of Three Million Three Hundred Fifty Thousand Six Hundred Sixty Eight Dollars and Fifty-Nine Cents ($3,350,668.59) in principal and accrued interest as of the Closing, as specifically set forth on Schedule 1.2.

(b) At the Closing, Buyer shall pay to Sellers an amount equal to the Base Consideration, with one-half of the Base Consideration paid to each Seller, by wire transfer of immediately available funds to an account or accounts designated by Sellers prior to the Closing Date.

1.3 Allocation of Purchase Price. The aggregate Purchase Price payable to the Sellers will be allocated among and paid to the Sellers as set forth on Exhibit A hereto.

Article II - CLOSING MATTERS

2.1 Closing. The closing of the purchase and sale of the Equity Interests contemplated by this Agreement (the “Closing”) will take place concurrently with the signing of this Agreement by exchanging faxed or e-mailed copies of signed documents. The date of the Closing is the “Closing Date” and the Closing will be deemed effective as of 11:59 p.m. local time on September ___, 2019 (the “Effective Time”).

2.2 Conditions to Buyer’s Obligations. The obligation of Buyer to consummate the transactions contemplated by this Agreement on the Closing Date is subject to the satisfaction of each of the following conditions:

(a) Consents. The Sellers will have obtained and delivered to Buyer all required third party consents, including the consents set forth on Schedule 2.2(a).

(b) Release of Liens. The Sellers will have obtained releases of all Liens, other than the Liens set forth on Schedule 2.2(b), on the assets of the Company and the Equity Interests. The Sellers will have delivered such payoff letters, discharges of Liens, releases of guarantees and other releases as are reasonably requested by Buyer at or prior to Closing.

(c) Closing Documents. At the Closing, the Sellers will have delivered, or will have caused to be delivered, to Buyer, all of the following documents:

(i) a certificate from the Secretary of the Company certifying the Organizational Documents of the Company;

(ii) a Certificate of Good Standing for the Company from the applicable Secretary of State;

(iii) the leases, in the form attached hereto as Exhibits C-1, C-2, and C-3, each executed by the landlord party thereto (collectively, the “Restated Leases”);

(iv) employment agreements, in the form attached hereto as Exhibit D, executed by Matthew Ritter and Michael Ritter, respectively (the “Employment Agreements”);

(v) certificates or other documents representing the Equity Interests, as well as such transfer documentation as shall be reasonably requested by Buyer;

(vi) written resignations of the officers and managers or members of the board of governors (or equivalent) of the Company, each duly executed by the appropriate parties;

(vii) the original record and minute books, equity ledgers and registers, and company seals, if any, of the Company;

(viii) a certificate of non-foreign status of the Sellers meeting the requirements of Treasury Regulation Section 1.1445-2(b)(2);

(ix) such other documents relating to the transactions contemplated by this Agreement as Buyer may reasonably request prior to Closing.

2.3 Conditions to the Sellers’ Obligations. The obligation of the Sellers to consummate the transactions contemplated by this Agreement on the Closing Date is subject to Buyer’s delivery to the Sellers copies of the following:

(i) resolutions duly adopted by Buyer’s board of directors authorizing the execution, delivery and performance of this Agreement,

(ii) the Restated Leases executed by Buyer;

(iii) the Employment Agreements executed by Buyer;

(iv) all other agreements or instruments contemplated hereby and the consummation of the transactions contemplated hereby.

Article III – COVENANTS

3.1 Sales and Transfer Taxes. All sales, use, excise, value-added, goods and services, transfer, recording, documentary, registration, conveyancing and similar Taxes that may be incurred in connection with this Agreement, together with any and all penalties, interest, and additions to Tax with respect thereto will be paid by the Buyer.

3.2 Further Assurances. In case at any time after the Closing any further action is necessary to carry out the purposes of this Agreement, each of the Parties will take such further action (including the execution and delivery of such further instruments and documents) as any other Party reasonably may request, all at the cost and expense of the requesting Party.

3.3 Administration of Accounts. All payments and reimbursements received by the Sellers or any entity controlled by Sellers after the Closing Date from any third party in the name of the Company will be held by the Sellers or such entity in trust for the benefit of Buyer. Immediately upon receipt of such payment or reimbursement, the Sellers will pay to Buyer the amount of such payment or reimbursement without right of set-off, offset, or reduction of any kind.

3.4 Confidentiality. Each Seller agrees that Seller will not use, or permit the use of, any of the information relating to the Business, or relating to Buyer or Buyer’s Affiliates, furnished to such Seller in connection with the transactions contemplated herein (“Information”) in a manner or for a purpose detrimental to Buyer or Buyer’s Affiliates, or otherwise than in connection with the transaction, and that it will not disclose, divulge, provide or make accessible (collectively, “Disclose” or “Disclosure”), or permit any other Person to Disclose, any of the Information to any individual or entity, other than its investment advisors, accountants, counsel and other authorized representatives and agents, except as may be required by judicial or administrative process or, in the opinion of his counsel, by other requirements of Law; provided, however, that prior to any Disclosure of any Information permitted hereunder, the Sellers will first obtain the recipients’ undertaking to comply with the provisions of this Section 3.4 with respect to such Information.

3.5 Non-Competition; Non-Solicitation; Non-Hire. As additional consideration for Buyer’s entry into this Agreement and consummation of the transactions contemplated hereby, and with the acknowledgement by the Sellers that Buyer would not enter into this Agreement without the benefit of the provisions set forth in this Section 3.5, each Seller agrees that the following restrictions on such Seller’s activities following the Closing Date are necessary, appropriate and reasonable to protect the Business and other legitimate interests of Buyer and its Affiliates:

(a) Non-Competition. For a period of five (5) years immediately following the Closing Date (the “Restricted Period”), each Seller agrees that such Seller will not, anywhere in the U.S., directly or indirectly, on behalf of any Person other than Buyer or its Affiliates, invest in, own, manage, operate, finance, control, advise, render services as an employee, independent contractor, or otherwise, or guarantee the obligations of any Person engaged in or planning to become engaged in the Business, or any business engaged in by Buyer or its Affiliates; provided, however, that the ownership of less than two percent (2%) of the outstanding stock of any publicly traded company will not by itself be deemed to be a violation of this provision.

(b) Non-Solicitation. During the Restricted Period, each Seller will not, directly or indirectly, solicit the business of any Person who is a customer of the Business, or of Buyer or its Affiliates, or cause, induce, or attempt to cause or induce, any customer, supplier, licensee, licensor, franchisee, employee, consultant or other business relation of Buyer or its Affiliates to cease doing business with such parties, to deal with any competitor of Buyer or its Affiliates, or in any way interfere with its relationship with such parties, all of the foregoing as it relates to the Business.

(c) Non-Hire. During the Restricted Period, each Seller will not, directly or indirectly, on behalf of any Person other than Buyer or its Affiliates, solicit, hire or engage in any capacity any employee of Buyer or its Affiliates (or any person or entity who was an employee of Buyer or its Affiliates within 12 months of the date such hiring or engagement occurs) or solicit or seek to persuade any employee of Buyer or its Affiliates to discontinue such employment.

(d) Modification of Covenant. If a final judgment of a court or tribunal of competent jurisdiction determines that any term or provision contained in this Section 3.5 is invalid or unenforceable, then the Parties agree that the court or tribunal will have the power to reduce the scope, duration or geographic area of the term or provision, to delete specific words or phrases or to replace any invalid or unenforceable term or provision with a term or provision that is valid and enforceable and that comes closest to expressing the intention of the invalid or unenforceable term or provision. This Section 3.5 will be enforceable as so modified.

(e) Enforcement of Covenant. The Parties agree that the remedy of damages at law for the breach of any of the covenants contained in this Section 3.5 is an inadequate remedy. In recognition of the irreparable harm that a violation by the Sellers of any of the covenants, agreements or obligations arising under this Section 3.5 would cause Buyer or its Affiliates, the Sellers agree that in addition to any other remedies or relief afforded by law, a preliminary and permanent injunction against an actual or threatened violation or violations may be issued against the Sellers without showing actual monetary damages or posting of a bond or other security. In the event of an action to enforce the covenants in this Section 3.5, the prevailing Party will be entitled to be reimbursed by the other Party for reasonable attorney’s fees and other expenses incurred by the prevailing Party with respect to such enforcement action; provided, however, Buyer will be entitled to be reimbursed by the Sellers in the event a Seller challenges the enforceability or reasonableness of any of the provisions of this Section 3.5. Each of Buyer’s Affiliates will have the right to enforce the Sellers’s obligations set forth in this Section 3.5. In addition, in the event any Seller violates any provisions of this Section 3.5, then, in such event the period of the violation will be added to the Restricted Period set forth in such section.

3.6 Certain Tax Matters.

(a) Tax Returns. The Sellers will prepare, or cause to be prepared, and file, or cause to be timely filed, all Tax Returns for the Companies for all Tax periods ending on or prior to the Closing Date (such Tax Returns constituting the “Pre-Closing Tax Returns”). The Sellers will timely pay all Taxes due with respect to all Pre-Closing Tax Returns. The Sellers will provide any unfiled Pre-Closing Tax Returns to Buyer for review at least ten (10) Business Days prior to filing, and the Sellers will reflect any reasonable comments made by Buyer on such Tax Returns. Notwithstanding the foregoing, the Sellers will not cause the Companies to extend or amend any Tax Returns with respect to any Tax period ending on or prior to the Closing Date without the prior written consent of Buyer. Buyer will prepare and timely file, or cause to be prepared and timely filed, all Tax Returns required to be filed by the Companies for all Tax periods beginning after the Closing Date. Buyer will timely pay all Taxes due with respect to all Tax periods beginning after the Closing Date, except that Sellers shall be responsible for that portion of any Taxes due for a Straddle Period as provided in Section 3.6(b).

(b) Straddle Period. In the case of any taxable period that includes (but does not end on) the Closing Date (a “Straddle Period”), (i) the amount of any Taxes based on or measured by income, gain, payroll or receipts of the Company for the Pre-Closing Tax Period will be determined based on an interim closing of the books as of the close of business on the Closing Date (with any net operating losses being first applied to the interim period ending on the Closing Date (to the extent available under applicable Law) and, therefore, first inuring to the benefit of the Sellers); and (ii) the amount of other Taxes of the Company for a Straddle Period that relates to the Pre-Closing Tax Period will be deemed to be the amount of such Tax for the entire taxable 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. The Sellers will timely pay all Taxes relating to that portion of the Straddle Period up to and including the Closing Date. Buyer will timely pay all Taxes relating to that portion of the Straddle Period after the Closing Date. If any Tax is due from the Sellers with respect to the portion of the Straddle Period ending on the Closing Date, the Sellers shall be provided with a copy of the applicable Tax Return and Buyer’s calculation and documentation of the Sellers’ portion of the Tax due. Buyer will prepare and timely file, or cause to be prepared and timely filed, all Tax Returns required to be filed by the Company for any Straddle Period.

(c) Cooperation; Audit. After the Closing Date, Buyer and the Sellers will, and will cause their respective Affiliates to, cooperate in the preparation of all Tax Returns of the Company and will provide, or cause to be provided, to the requesting Party any records or other information requested by such Party in connection therewith. The Sellers, on the one hand, and Buyer, on the other hand, will give prompt notice to each other of any proposed adjustment to Taxes for the Pre-Closing Tax Period or the Straddle Period. Promptly upon receipt by either Party of any notification or indication (whether written or oral) from any taxing authority that it intends to investigate or audit any Tax Return of the Company for any Tax period ending on or prior to the Closing Date, the Party receiving such information will notify the other Party and convey such information to the other Party in writing. Each Party will cooperate with the other in connection with any Tax investigation, Tax audit, or other Tax proceeding; provided, however, Buyer will be entitled to represent the Company on any Tax investigation, Tax audit, or other Tax proceeding that arises after the Closing Date provided Buyer will allow the Sellers to reasonably participate at the Sellers’ own cost and expense to the extent such matter could reasonably result in an indemnification claim against the Sellers pursuant to this Agreement. A Party will be reimbursed for reasonable out-of-pocket expenses incurred in taking any action reasonably requested by the other Party or Parties under this Section 3.6(c); provided, however, that the foregoing will not alter any indemnification rights to which the Parties are entitled under this Agreement.

3.7 Release by Sellers. Effective as of the Closing, in consideration of the mutual covenants and agreements contained herein, including the consideration to be received by the Sellers, each Seller hereby irrevocably releases and forever discharges the Company and Buyer, and their respective Affiliates, officers, managers, directors, members, partners (general or limited), agents, and employees, and the successors, heirs, assigns, executors and administrators to the foregoing (collectively, the “Released Parties”), of and from any and all manner or causes of action and actions, claims, suits, rights, debts, sums of money, covenants, contracts, damages and judgments whatsoever, in law or in equity, which the Sellers ever had, now has or which the Sellers can, shall or may have, against the Released Parties, whether known or unknown, suspected or unsuspected, matured or unmatured, fixed or contingent, for, upon or by reason of any matter relating to the Company or its Affiliates, and arising at any time on or prior to the Closing Date, whether in the Seller’s capacity as an equityholder, director, manager, officer, employee, holder of Indebtedness or otherwise, and the Released Parties shall not have liability with respect thereto, provided, however, that such release shall not will not apply to obligations owing to the Sellers arising pursuant to the Transaction Documents.

3.8 Release by Company. Effective as of the Closing, in consideration of the mutual covenants and agreements contained herein, each of the Released Parties hereby irrevocably releases and forever discharges each Seller, and their respective Affiliates, partners (general or limited), agents, and employees, and the successors, heirs, assigns, executors and administrators to the foregoing (collectively, the “Seller Released Parties”), of and from any and all manner or causes of action and actions, claims, suits, rights, debts, sums of money, covenants, contracts, damages and judgments whatsoever, in law or in equity, which the Released Parties ever had, now has or which the Released Parties can, shall or may have, against the Seller Released Parties, whether known or unknown, suspected or unsuspected, matured or unmatured, fixed or contingent, for, upon or by reason of any matter relating to the Company or its Affiliates, and arising at any time on or prior to the Closing Date.

3.9 D&O Claims. Notwithstanding anything herein to the contrary elsewhere in this Agreement, each Seller hereby agrees that he will not make any claim for indemnification against Buyer, Buyer Indemnified Parties, or the Company by reason of the fact that he was a controlling person, manager, director, officer, or representative of the Company.

Article IV - REPRESENTATIONS AND WARRANTIES OF
THE Sellers

The Sellers jointly and severally represent and warrant to Buyer that the statements contained in this Article IV are true and correct as of the date hereof except as set forth in the corresponding schedule of the disclosure schedules attached hereto (the “Disclosure Schedules”).

4.1 Organization and Qualification. The Company is a duly organized, validly existing limited liability company in good standing under the Laws of the state of its formation. The Company has all the requisite power, authority, and capacity to own, lease, and operate its assets and to carry on the Business as the same was and is now being conducted. The Company is qualified to transact business as a foreign entity and is in good standing under the Laws of each jurisdiction in which the nature of its business or the ownership or leasing of its properties requires such qualification, except where the failure to so qualify has not and would not reasonably be expected to have a Material Adverse Effect on the Company. The Sellers have heretofore delivered to Buyer complete and correct copies of the Company’s Organizational Documents now in effect, and the Company is not in default under or in violation of any provision of its Organizational Documents.

4.2 Power and Authority; Enforceability. The Sellers have all power and authority to enter into and consummate the transactions contemplated by this Agreement and any ancillary agreements (the “Transaction Documents”) to which they are a party. The execution and delivery of the Transaction Documents by the Sellers and the consummation of the transactions contemplated by the Transaction Documents to which the Sellers are a party have been duly authorized by all necessary action on the part of each Seller. The Transaction Documents have been duly executed and delivered by the Sellers, and such Transaction Documents constitute the legal, valid and binding obligations of each Seller, enforceable against each Seller in accordance with their respective terms, except to the extent that (a) their enforceability may be limited by applicable bankruptcy, insolvency, reorganization, or other Laws affecting the enforcement of creditor’s rights generally, and (b) the availability of equitable remedies is subject to the discretion of the court before which any such proceeding may be brought.

4.3 No Conflict. Neither the execution and delivery of this Agreement nor the performance of the provisions hereof or the transactions contemplated hereby: (a) violate or conflict with the Company’s Organizational Documents; (b) materially violate or conflict with any Law, rule, regulation, writ, judgment, injunction, decree, determination, award or other order of any court, government or governmental agency or instrumentality, domestic or foreign, that is applicable to the Company; or (c) except as set forth on Schedule 4.3, will result in a material breach of any of the terms or conditions of, or constitute a material default under, any mortgage, note, bond, indenture, agreement, license or other instrument or obligation to which the Company or any Seller is a party or by which any of their respective properties or assets may be bound or affected. Except as set forth on Schedule 4.3, the execution, delivery and performance of this Agreement and the consummation of the transactions contemplated hereby do not require any material authorization, consent, permission, waiver, approval, exemption or other material action by or notice to any Governmental Entity or other third party, under any Material Contract or Governmental Contract to which the Company is bound, or any law, statute, rule or regulation or order, judgment or decree to which the Company is subject.

4.4 Capitalization. The capitalization of the Company is as set forth on Schedule 4.4. The Equity Interests set forth on Schedule 4.4 constitute all of the outstanding Equity Interests of the Company and are validly issued, fully paid and non-assessable. There are (i) no outstanding subscriptions, options, calls, Contracts, commitments, understandings, restrictions, arrangements, rights or warrants, including any rights plan, and any right of conversion or exchange under any outstanding security, instrument or other agreement, obligating any Company to issue, deliver or sell, or cause to be issued, delivered or sold, additional equity interests of any Company, respectively, or obligating the Company to grant, extend or enter into any such agreement or commitment, and (ii) no voting trusts, proxies or other agreements or understandings to which the Company or the Sellers are a party or are bound with respect to the voting of any of the Equity Interests of the Company. Each Seller has good and valid title to and beneficial ownership in the Equity Interests set forth on Schedule 4.4 and such Equity Interests are free and clear of all Liens. Except as set forth on Schedule 4.4, the Company has no equity interest in any direct or indirect subsidiary.

4.5 Financial Statements; Undisclosed Liabilities and Defaults.

(a) The Company has delivered to Buyer the unaudited balance sheets of the Company as of December 31, 2018 and December 31, 2017 and the related statements of income, stockholders’ equity and cash flows for the fiscal years then ended. All of the foregoing financial statements are collectively referred to herein as the “Financial Statements.” The Financial Statements have been prepared in accordance with GAAP and fairly present, in all material respects, the financial condition and results of operation of the Company at the dates and for the periods indicated therein, except as otherwise may be indicated therein. The Company’s accounting practices have been consistently applied for all periods represented by the Financial Statements, except as otherwise may be indicated therein.

(b) The Company’s books of account and financial records are true and correct in all material respects and have been prepared and are maintained in accordance with sound accounting practice. The Financial Statements have been prepared and presented based upon and in conformity with such books of account and financial records.

(c) Except as set forth on Schedule 4.5(c) or as and to the extent adequately accrued or reserved against in the unaudited balance sheet of the Company as of December 31, 2018, the Company does not have any Liability, Indebtedness or obligation which would be required by GAAP to be reflected in a balance sheet of the Company prepared in accordance with GAAP or disclosed in the notes thereto, except for liabilities and obligations, incurred in the ordinary course of business consistent with past practice since December 31, 2018.

4.6 Intentionally Omitted.

4.7 Compliance with Laws.

(a) The Company is in compliance in all material respects with all applicable Laws with respect to the Business.

(b) The Company holds all material permits, approvals, registrations, franchises, licenses, certificates, accreditations and other authorizations of all Governmental Entities (the “Permits”) required for the conduct of the Business and all such Permits are set forth on Schedule 4.7. The Company has complied with and is in compliance with the terms and conditions of such Permits in all material respects. The Company has not received any notices that it is in material violation of any of the terms or conditions of such Permits. The Company has taken all reasonable action to maintain such Permits. No loss or expiration of any such Permit is pending or threatened other than expiration in accordance with the terms thereof.

4.8 Claims. Except as set forth on Schedule 4.8 and except for claims covered by insurance or otherwise made in the ordinary course of business, there are no claims, actions, suits, inquiries, proceedings (including any arbitration proceedings), judgments, orders, awards, decrees, or investigations, pending or, to the Knowledge of the Company, threatened against the Company or any officer, director or employee thereof, or any Seller, in each case relating to the Business.

4.9 Title to Assets; Sufficiency. Except as set forth on Schedule 4.9, the Company holds good and marketable title to all of its property and assets, free and clear of any Liens, except Permitted Liens. No Person other than the Company has any right or interest in the assets of the Company, including the right to grant interests in the assets to third parties. The assets owned or leased by the Company are all those assets necessary to conduct the Business as presently conducted and will allow Buyer to continue to operate the Business in substantially the same manner immediately following the Closing Date. The equipment, machinery, fixtures, vehicles, computer hardware and furniture owned, leased or used by the Company is in good repair and operating condition (subject to ordinary wear and tear), and is suitable for the purposes for which it is used, and has been maintained in all material respects in accordance with the applicable manufacturer’s suggested maintenance procedures. All accounts and notes receivable of the Company represent amounts receivable for goods actually delivered or services actually provided (or in the case of notes and non-trade receivables, represent amounts in respect of other bona fide business transactions), to the Knowledge of the Company, are not subject to any defenses, counterclaims or rights of set off, have been billed and are generally due and payable within 30 days after billing, and subject to reasonable write-offs consistent with the prior experience of the company, will be fully collectible in the Ordinary Course of Business.

4.10 Indebtedness and Guarantees. Except as set forth on Schedule 4.10, the Company has no Indebtedness, and the Company does not guarantee the Indebtedness of any third party. Schedule 4.10 accurately states the outstanding balance of all Indebtedness as of the Closing Date. The sale of the Equity Interests pursuant to this Agreement is made in exchange for fair and equivalent consideration. The transactions contemplated by this Agreement and the agreements referenced in this Agreement will not give rise to any right of any creditor of the Company to accelerate the due date or alter the repayment terms of any Indebtedness of the Company. The transactions contemplated in this Agreement or any agreements referenced in this Agreement will not give rise to any right of any creditor of the Sellers whatsoever against Buyer or to any of the Equity Interests in the hands of Buyer after the Closing.

4.11 Material Contracts. Schedule 4.11 contains a complete and accurate list of all Material Contracts to which the Company is a party. Except as set forth on Schedule 4.11, (a) the Company has performed in all material respects the obligations required to be performed by it to date under its Material Contracts, and, (b) to the Knowledge of the Sellers there are no defaults by any other party thereto, and, (c) to the Knowledge of the Sellers, no event has occurred (or failed to occur) that, with the passing of time or the giving of notice or both would constitute a default by the Company under any such Material Contract, including the consummation of the transactions contemplated by this Agreement and no permission, waiver or approval is required to be obtained from any third party in order to preserve for Buyer the benefits of the Material Contracts after the consummation of the transaction contemplated by this Agreement. Each Material Contract is in full force and effect and constitutes a legal, valid, binding agreement of the Company except to the extent that such enforcement may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or other similar laws now or hereafter in effect relating to creditors’ rights generally, and except that the remedy of specific performance and injunctive and other forms of equitable relief may be subject to equitable defenses and to the discretion of the court before which any proceeding therefor may be brought. Buyer has been supplied with, or been provided access to, a true and correct copy of all written Material Contracts and true and correct written summaries of all oral Material Contracts.

4.12 Government Contracts and Government Bids.

(a) Schedule 4.12 contains a complete and accurate list of each Government Contract the period of performance of which has not yet expired or been terminated (each, a “Current Government Contract”). The Company has delivered to or provided Buyer access to complete and correct copies of each Current Government Contract. Each Current Government Contract was legally awarded to the Company. Each Current Government Contract is valid, binding and in full force and effect and enforceable against the Company in accordance with its terms except to the extent that such enforcement may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or other similar laws now or hereafter in effect relating to creditors’ rights generally, and except that the remedy of specific performance and injunctive and other forms of equitable relief may be subject to equitable defenses and to the discretion of the court before which any proceeding therefor may be brought.

(b) (i) The Company is not in material breach of or default under any Current Government Contract, and, to the Knowledge of the Company, no event has occurred which, with the giving of notice or the lapse of time or both, would constitute such a breach or default by the Company; (ii) the Company is in compliance in all material respects with the Federal Acquisition Regulation (“FAR”), Cost Accounting Standards, Service Contract Act of 1963, as amended (including requirements for paying applicable Service Contract Act wage rate and fringe benefit rates), the Truth in Negotiations Act, and the Anti-Kickback Act, in each case where and as applicable to each Current Government Contract or Government Bid; (iii) since January 1, 2016, each representation and certification made by the Company in connection with a Government Contract or Government Bid was current, accurate and complete in all material respects as of its effective date, and the Company has complied in all material respects with the terms of all Government Contracts; (iv) there are no outstanding or pending claims, requests for equitable adjustment or contract disputes in excess of $100,000 arising under or relating to a Government Contract or Government Bid; and (v) no Current Government Contract or Government Bid is currently the subject of any bid protest before any Governmental Entity.

(c) Since January 1, 2016, (i) neither the Company nor any Seller (as defined in FAR 52.209-5) has been debarred, suspended or excluded from participation in, or the award of, Government Contracts or doing business with any Governmental Entity, no suspension, debarment, or exclusion action has been commenced or threatened against the Company or any of its officers or employees, and there exist no circumstances that require the Company to answer any of the questions in FAR 52.209-5 in the affirmative; (ii) no Governmental Entity under a Government Contract has notified the Company of any breach or violation of any applicable Law or of any certification, representation, clause, provision or requirement of any such Government Contract; (iii) the Company has not received any notice of termination for default, cure notice or show cause notice pertaining to any Government Contract; (iv) the Company has not received any notice of an unresolved significant weakness or deficiency with respect to the cost accounting system of the Company; (v) the Company has not received written notice from any Governmental Entity or other counterparty to a Government Contract that the counterparty to such Government Contract (A) has ceased or will cease to be a customer of the Company, (B) intends to terminate or materially modify (including by materially decreasing the rate or amount of services obtained from the Company) any Government Contract, (C) intends to change the type of contracting vehicle for the services provided pursuant to such Government Contract in a manner that may preclude the Company from continuing to provide such services or (D) seeks to convert any Government Contract that establishes an exclusive or single source purchasing arrangement or relationship between such counterparty and the Company into a non-exclusive or multi-source arrangement or relationship; and (vi) the Company has not made any voluntary or mandatory disclosures to any Governmental Entity with respect to any material misstatement, significant overpayment or violation of applicable Law arising under or relating to any Government Contract or Government Bid, nor has any violation occurred for which the Company is required to make any such disclosure to a Governmental Entity.

(d) January 1, 2016, the Company has not been the subject or target of any audit, subpoena, investigation, prosecution or administrative proceeding related to any Government Contract or Government Bid. Since January 1, 2016, the Company has not received any written or oral notice of any pending or threatened audit, subpoena, investigation, prosecution or administrative proceeding related to any Government Contract or Government Bid.

4.13 Insurance. The Company is currently insured by insurers unaffiliated with the Company with respect to its properties, its assets and the operation of the Business in such amounts and against such risks as are appropriate and customary for the type of business conducted by the Company with customary deductibles and retained amounts and which insurance policies are set forth on Schedule 4.13. In addition, to the Knowledge of the Sellers, the Company has maintained adequate insurance for all prior periods with respect to the Business. With respect to each insurance policy held by the Company (a) the policy is legal, valid, binding and in full force and effect; and (b) the Company is not in default under any insurance policy held by the Company. The Company is not in default under any insurance policy held by the Company. All premiums under such insurance policies which are due and payable have been paid in full and the Company has not received notice of any material increase in the premium under, or the cancellation or non-renewal of, any such policy.

4.14 Intellectual Property. Set forth on Schedule 4.14 is a list and brief description of patents, patent rights, patent applications, trademarks, trademark applications and registrations, trade dress, proprietary rights, service marks, service mark applications, trade names, social media accounts and registrations, domain names and copyrights owned by or registered in the name of the Company and used in the Business, or, except with respect to commercially available off-the-shelf software (“COTS”), of which the Company is a licensor or licensee or in which the Company has any right, and in each case a brief description of the nature of such right. Except for payments made for the license of COTS, the Company is not subject to any obligation, including any license or royalty obligation, relating to any product or service of the Business that the Company now markets or has marketed in the three past years. Except as set forth on Schedule 4.14, the Company owns all rights in, or possesses adequate licenses or other rights to use, all patents, patent applications, trademarks, trademark applications and registrations, trade dress, service marks, service mark applications and registrations, proprietary rights, trade names, social media accounts and registrations, domain names, copyrights, manufacturing processes, batch tickets, designs, website content, formulae, technology, molds, trade secrets and know how necessary to conduct the Business as conducted prior to Closing (collectively, “Intellectual Property”). To the Knowledge of the Sellers, the Intellectual Property does not infringe or conflict upon the right of any third party, and to the Knowledge of the Sellers there has not been, and are, no infringing uses by third parties of the Intellectual Property owned by the Company. No Seller owns or has any interest in the Intellectual Property used by the Company in connection with the Business. No past or present employee or independent contractor (including consultants) of the Company has any ownership interest, license, permission or other right in or to any Intellectual Property, ideas, inventions, processes, works of authorship and other work products that relate to the Business, that were conceived, created, authored or developed, in whole or in part, by such employee or independent contractor.

4.15 Real Property. Real Property. The Company does not, directly or indirectly, own any real property, nor has it ever owned any real property. Schedule 4.15 sets forth the address of each parcel of real estate leased by the Company (“Leased Real Property”), a true and complete list of all leases for each such Leased Real Property, and the amount of security deposit for each such Leased Real Property. The Company has not collaterally assigned or granted any other security interest in any Leased Real Property or any interest therein. Except as set forth on Schedule 4.15, each Contract for Leased Real Property is legal, valid, binding, enforceable and in full force and effect, and the Company’s possession and quiet enjoyment of the Leased Real Property under such lease has not been disturbed, and there are no disputes with respect to such lease. Except as set forth on Schedule 4.15, neither the Company nor any other party to the lease is in breach or default under such lease, and no event has occurred or circumstance exists which, with the delivery of notice, the passage of time or both, would constitute such a breach or default, or permit the termination, modification or acceleration of rent under such lease.

4.16 Labor Matters. Labor Matters. The Company is in compliance in all material respects with all Laws with respect to employment and employment practices, terms and conditions of employment and wages and hours (including the Employee Retirement Income Security Act of 1974, as amended, and the Contract Service Act, as amended), including requirements for paying applicable Service Contract Act wage rate and fringe benefit rates, and the Company is not engaged in any unfair labor practice and has not been threatened with a possible claim for any such practice. The Company has properly classified its employees and independent contractors. Except as set forth in Schedule 4.16, the Company is not, and has not been for the past five years, a party to, bound by, or negotiating any collective bargaining agreement or other Contract with a union, works council or labor organization (collectively, “Union”), and there is not, and has not been for the past five years, any Union representing or purporting to represent any employee of the Company, and no Union or group of employees is seeking or has sought to organize employees for the purpose of collective bargaining. Except as set forth in Schedule 4.16, there has never been, nor has there been any threat of, any strike, slowdown, work stoppage, lockout, concerted refusal to work overtime or other similar labor disruption or dispute affecting the Company or any of its employees. The Company has no duty to bargain with any Union.

4.17 Tax Matters. Schedule 4.17 contains a list of states, territories, and jurisdictions (whether foreign or domestic) in which the Company files Tax Returns. The Company has filed all Tax Returns that it was required to file. All such filed Tax Returns were true, correct, and complete. Except as set forth on Schedule 4.17, all Taxes due and payable prior to Closing by the Company have been paid. The Company has withheld and paid all Taxes required to have been withheld and paid in connection with amounts paid or owing to any employee. There are no Liens on any of the assets of the Company that arose in connection with any failure (or alleged failure) to pay any Tax. The Company has not received any notice from any Governmental Entity that it is subject to an audit or investigation that could result in the payment of additional Taxes. The Company is not a party to any Tax allocation, sharing, indemnity or similar agreement. The Company has no Liability for the Taxes of any Person, as a transferee or successor, by Contract, or otherwise.

4.18 Absence of Certain Developments. Since January 1, 2019, except with respect to cash distributions to the Sellers, the Company has conducted its business in the ordinary course of business consistent with past practice.

4.19 Related Party Transactions. Except as set forth on Schedule 4.19, the Company is not currently a party to any Related Party Transaction in connection with the Business and has not been a party to any such Related Party Transaction since January 1, 2017.

4.20 Safety Rating. Except as set forth on Schedule 4.20, the Company has an overall “Satisfactory” safety rating, and maintained Compliance, Safety and Accountability scores (“CSA Scores”) below the “alert” threshold in each of the seven categories assessed by the DOT in connection therewith. To the Knowledge of the Sellers, there are no issues, deficiencies or violations which would adversely affect such safety rating or CSA Scores. Neither any Seller nor the Company has received any written or other notice of any intended, pending or proposed audit of the Business by the DOT or any other Governmental Entity having jurisdiction over the Company’s operation of the Business.

4.21 Intentionally Omitted.

4.22 Brokerage and Finder’s Fees. Neither the Company nor any Seller has incurred and neither the Company nor any Seller will incur any brokerage, finder, or similar fee in connection with the transactions contemplated by the Transaction Documents to which any of them are a party.

4.23 Vendors. The Company provided Buyer accurate and complete lists of the names and addresses of the 20 largest vendors of the Business from whom the Company has purchased either supplies or inventories for the past two fiscal years (ended December 31, 2018 and December 31, 2017).

4.24 Environmental Matters.

(a) The Company is in compliance in all material respects with all applicable Environmental Laws. The Company holds and has timely applied for renewal of all permits or other authorizations under Environmental Laws that are required for (i) the occupancy, use and operation of its properties and assets, and (ii) the operation and conduct of such Company and the Business.

(b) The Company has not received any outstanding and unresolved written or oral notices, reports, or other information regarding any actual or alleged violation of Environmental Laws by the Company, or any Liabilities or potential Liabilities, including any remedial obligations, arising under Environmental Laws and relating to the Company or its properties. There are no pending or threatened, claims, Liens, or other restrictions of any nature, resulting from any violation or failure to comply with any applicable Environmental Law, with respect to or affecting any of the properties currently occupied, used or operated by the Company. There are no present or past actions, activities, circumstances, conditions, facts, events or incidents, including without limitation, the Release or threatened Release or presence of any Hazardous Substances, which could form the basis for any litigation against the Company or that could result in the imposition of any Liability on the Company, in each case under Environmental Laws.

(c) No facts, events, or conditions relating to the past or present properties or operations of the Company will prevent, hinder, or limit the Company’s continued compliance with Environmental Laws, or give rise to any remedial obligations or material Liability of the Company pursuant to Environmental Laws. During or prior to the period of (i) the Company’s occupancy, use or operation of any property, or (ii) the Company’s participation in the management of any property, there were no Releases or threatened Releases of any Hazardous Substances in, on, under or affecting any such property, and the Company has not placed, held, located, Released, transported or disposed of any Hazardous Substances on, under, from or at any such property or any other property other than in compliance with applicable Environmental Laws. Except as set forth on Schedule 4.24(c), no above ground or underground storage tanks, asbestos-containing materials, lead-based paint, toxic mold or polychlorinated biphenyls are or have been present at any property currently or formerly leased or operated by the Company. The Company has not sent or disposed of Hazardous Substances to or at a site which, pursuant to the Comprehensive Environmental Response, Compensation, and Liability Act (42 U.S.C. § 9601 et seq.), or any similar state, federal or foreign law, has been listed or proposed for listing on the “National Priorities List” or its state equivalent.

(d) The Company has delivered to Buyer correct and complete copies of all environmental studies or reports (including, but not limited to, any Phase I or Phase II reports and compliance audits), pleadings, analytical data, monitoring data, permits required under Environmental Laws, and other material records and correspondence concerning Environmental Laws relating to the occupancy, use and operation of its properties and the operation of the Business that are in the possession or reasonable control of the Sellers.

4.25 Employee Benefit Plans. Set forth on Schedule 4.25 is a complete list of all pension, profit sharing, retirement, profits units, bonus, incentive compensation and deferred compensation plans, life, health, dental, accident or disability, workers’ compensation or other employee welfare benefit plans (insured or self-insured), educational assistance, pre-tax premium or flexible spending account plans, supplemental or executive benefit plans, non-qualified retirement plans, severance or separation plans, and any other employee benefit plans, practices, policies or arrangements of any kind, whether written or oral, which are currently maintained by the Company for the benefit of any of their respective employees (including former employees), or under which the Company has any current or potential Liability with respect to any employee or former employee or the dependents of any such person, including any “employee benefit plan” which is subject to the Employee Retirement Income Security Act of 1974, as amended (“ERISA”) (herein collectively referred to as “Employee Benefit Plans” and individually as an “Employee Benefit Plan”). All Employee Benefit Plans comply in form and in operation in all material respects with their terms, the applicable requirements of ERISA, the Code and all applicable Laws. The Company has complied in all material respects with the terms of all Employee Benefit Plans and related Contracts. Buyer has been supplied with or been provided access to a true and correct copy of all written Employee Benefit Plans and true and correct written summaries of all oral Employee Benefit Plans. With respect to the Employee Benefit Plans, no event has occurred and, there exists no condition or set of circumstances, in connection with which the Company could be subject to any Liability (other than for routine claims for benefits in the ordinary course) under the terms of the Employee Benefit Plans or any applicable Law. The Company does not sponsor or participate in (i) a pension plan that is subject to Title IV of ERISA, Section 302 of ERISA or Section 412 of the Code, (ii) a “multi-employer pension plan,” as defined in Section 3(37) of ERISA, (iii) a “multiple employer welfare arrangement,” as defined in Section 3(40) of ERISA, (iv) a “multiple employer plan,” as defined in Section 413 of the Code, (v) a “welfare benefits trust” or “voluntary employees beneficiary association,” as defined in Sections 419, 419A or 501(c)(9) of the Code, or (vi) a plan or arrangement providing for post-employment health or life insurance coverage, except as otherwise required by Section 4980B of the Code or similar state Laws and at the sole expense of the individual.

4.26 Accounts; Powers of Attorney. Schedule 4.26 sets forth a correct and complete list of all accounts or safe deposit boxes at any bank or other financial institution of the Company, and the names of all Persons authorized to draw thereon or have access thereto. Except as set forth on Schedule 4.26, no Person holds a power of attorney to act on behalf of the Company.

Article V- REPRESENTATIONS AND WARRANTIES OF BUYER

Buyer represents and warrants to the Sellers that the statements contained in this Article V are true and correct as of the date hereof:

5.1 Organization and Qualification. Buyer is a limited liability company duly organized, validly existing and in good standing under the Laws of Delaware. Buyer is qualified to transact business as a foreign entity and is in good standing under the Laws of each jurisdiction in which the nature of its business or the ownership or leasing of its properties requires such qualification, except where the failure to so qualify has not and would not reasonably be expected to have a Material Adverse Effect on Buyer.

5.2 Power and Authority; Enforceability. Buyer has all requisite corporate power and authority to enter into and consummate the transactions contemplated by the Transaction Documents to which Buyer is a party. The execution and delivery by Buyer of the Transaction Documents to which it is a party and the consummation of the transactions contemplated thereby have been duly authorized by all necessary action on the part of Buyer. The Transaction Documents have been duly executed and delivered by Buyer and constitute the legal, valid and binding obligations of Buyer, enforceable against Buyer in accordance with their respective terms, except to the extent that (a) their enforceability may be limited by applicable bankruptcy, insolvency, reorganization or other Laws affecting the enforcement of creditor’s rights generally, and (b) the availability of equitable remedies is subject to the discretion of the court before which any such proceeding may be brought.

5.3 No Conflict. Neither the execution and delivery of this Agreement nor the performance of the provisions hereof or the transactions contemplated hereby: (a) violate or conflict with Buyer’s Organizational Documents; (b) materially violate or conflict with any Law, rule, regulation, writ, judgment, injunction, decree, determination, award or other order of any court, government or governmental agency or instrumentality, domestic or foreign, that is applicable to Buyer; or (c) will result in a material breach of any of the terms or conditions of, or constitute a material default under, any mortgage, note, bond, indenture, agreement, license or other instrument or obligation to which Buyer is a party or by which any of its respective properties or assets may be bound or affected. The execution, delivery and performance of this Agreement and the consummation of the transactions contemplated hereby do not require any material authorization, consent, approval, exemption or other material action by or notice to any Governmental Entity or other third party, under any Material Contract or Governmental Contract to which the Company is bound, or any law, statute, rule or regulation or order, judgment or decree to which the Company is subject.

5.4 Brokerage and Finder’s Fees. Buyer has not incurred and will not incur any brokerage, finder, or similar fee in connection with the transactions contemplated by the Transaction Documents to which it is a party.

5.5 Investment Intent. Buyer is acquiring the Equity Interests for its own account for investment purposes only and not with a view to any public distribution thereof or with any intention of selling, distributing or otherwise disposing of the Equity Interests in a manner that would violate the registration requirements of the Securities Act of 1933, as amended (the “Securities Act”). Buyer agrees that the Equity Interests may not be sold, transferred, offered for sale, pledged, hypothecated or otherwise disposed of without registration under the Securities Act and any applicable state securities laws, except pursuant to an exemption from such registration under the Securities Act and such laws. Buyer is able to bear the economic risk of holding the Equity Interests for an indefinite period (including total loss of its investment), and (either alone or together with its Representatives) has sufficient knowledge and experience in financial and business matters so as to be capable of evaluating the merits and risk of its investment.

5.6 Buyer's Investigation and Reliance. Buyer is a sophisticated purchaser and has made its own investigation, review and analysis regarding the Companies and the transactions contemplated hereby, which investigation, review and analysis were conducted by Buyer together with expert advisors that it has engaged for such purpose. Buyer and its Representatives have been provided with full and complete access to the Representatives, properties, offices, plants and other facilities, books and records of the Company and its Subsidiaries and other information that they have requested in connection with their investigation of the Companies and the transactions contemplated hereby. Buyer is not relying on any statement, representation or warranty, oral or written, express or implied, made by the Sellers or their Affiliates or Representatives with respect to the Companies, except as expressly set forth in Article IV and the Disclosure Schedules. Neither the Sellers nor any of their Affiliates or Representatives shall have any liability to Buyer or any of its Affiliates or Representatives resulting from the use of any information, documents or materials made available to Buyer, whether orally or in writing, in any confidential information memoranda, “data rooms”, management presentations, due diligence discussions or in any other form in expectation of the transactions contemplated by this Agreement. Neither the Sellers nor any of their Affiliates or Representatives is making, directly or indirectly, any representation or warranty with respect to any estimates, projections or forecasts involving the Companies. Buyer acknowledges that there are inherent uncertainties in attempting to make such estimates, projections and forecasts and that it takes full responsibility for making its own evaluation of the adequacy and accuracy of any such estimates, projections or forecasts (including the reasonableness of the assumptions underlying any such estimates, projections and forecasts). Buyer acknowledges that, should the Closing occur, Buyer shall acquire the Companies without any representation or warranty as to merchantability or fitness for any particular purpose of their respective assets, on an “as is” and “where is” basis, except as expressly set forth in Article IV and the Disclosure Schedules. Buyer has no Knowledge or reason to believe that any of the representations or warranties made by the Sellers as of the date hereof are untrue, incomplete or inaccurate. Nothing in this Section 5.6 is intended to modify or limit any of the representations or warranties of the Sellers set forth in Article IV.

ARTICLE VI – INDEMIFICATION

6.1 Survival of Representations, Warranties, Covenants and Agreements. The representations, warranties, covenants and agreements in this Agreement and the Disclosure Schedules attached hereto or in any writing delivered by any Party to any of the other Parties in connection with this Agreement will survive (a) for a period of 24 months after the Closing Date for representations and warranties except as set forth in subparts (b), (b) indefinitely for the representations and warranties set forth in Sections 4.1, 4.2, 4.3, 4.4, 4.16, 4.17, 4.22, 4.24 and 4.25 (collectively, the “Fundamental Representations”), (c) indefinitely for claims based on fraud or intentional misrepresentation, (d) indefinitely for all covenants and agreements that by their terms contemplate performance after the Closing Date, unless specified otherwise by their terms, or (e) the statute of limitations plus thirty (30) days for all other claims. Notwithstanding the above, so long as written notice of a claim is given on or prior to the expiration of survival period, such claim will continue to survive until such matter is resolved.

6.2 Indemnification by the Sellers. The Sellers agree to indemnify, defend and hold harmless Buyer and its Affiliates, directors, managers, officers, equityholders, members, partners, and their respective successors and assigns (the “Buyer Indemnified Parties”) from, against and in respect of any Losses imposed on, sustained, incurred or suffered by or asserted against any of Buyer Indemnified Parties directly or indirectly, whether or not due to a third-party claim, arising out of or resulting from:

(a) a breach of any representation or warranty of Sellers made in this Agreement;

(b) a breach of any covenant or agreement of any Seller made in this Agreement;

(c) any unpaid Taxes of either Company; and

(d) any Outstanding Transaction Expenses of either Company.

6.3 Indemnification by Buyer. Buyer agrees that it will indemnify, defend, and hold harmless the Sellers and their Affiliates, partners, and their respective successors and assigns (the “Seller Indemnified Parties”), from, against and in respect of any and all Losses imposed on, sustained, incurred or suffered by or asserted against any of the Seller Indemnified Parties directly or indirectly, whether or not due to a third-party claim, arising out of or resulting from:

(a) any breach of any representation or warranty of Buyer made in this Agreement; and

(b) a breach of any covenant or agreement of Buyer made in this Agreement.

6.4 Procedures.

(c) In order for a Buyer Indemnified Party or Seller Indemnified Party (the “Indemnified Party”) to be entitled to any indemnification provided for under this Agreement as a result of a Loss or a claim or demand made by any Person against the Indemnified Party (a “Third Party Claim”), such Indemnified Party shall deliver notice thereof to the party against whom indemnity is sought (the “Indemnifying Party”) promptly after receipt by such Indemnified Party of written notice of the Third Party Claim, describing in reasonable detail the facts giving rise to any claim for indemnification hereunder, the amount or method of computation of the amount of such claim (if known) and such other information with respect thereto as the Indemnifying Party may reasonably request. The failure to provide such notice, however, shall not release the Indemnifying Party from any of its obligations under this Article VI except to the extent that the Indemnifying Party is prejudiced by such failure.

(d) The Indemnifying Party shall have the right, upon written notice to the Indemnified Party within 30 days of receipt of notice from the Indemnified Party of the commencement of such Third Party Claim, to assume the defense thereof at the expense of the Indemnifying Party with counsel selected by the Indemnifying Party and reasonably satisfactory to the Indemnified Party. If the Indemnifying Party assumes the defense of such Third Party Claim, the Indemnified Party shall have the right to employ separate counsel and to participate in the defense thereof, but the fees and expenses of such counsel shall be at the expense of the Indemnified Party. If the Indemnifying Party assumes the defense of any Third Party Claim, the Indemnified Party shall cooperate with the Indemnifying Party in such defense and make available to the Indemnifying Party all witnesses, pertinent records, materials and information in the Indemnified Party’s possession or under the Indemnified Party’s control relating thereto as is reasonably required by the Indemnifying Party. Whether or not the Indemnifying Party assumes the defense of a Third Party Claim, the Indemnified Party shall not admit any liability with respect to, or settle, compromise or discharge, or offer to settle, compromise or discharge, such Third Party Claim without the Indemnifying Party’s prior written consent, (which consent shall not be unreasonably withheld).

(e) In the event any Indemnified Party should have a claim against any Indemnifying Party hereunder that does not involve a Third Party Claim being asserted against or sought to be collected from such Indemnified Party, the Indemnified Party shall deliver notice of such claim promptly to the Indemnifying Party, describing in reasonable detail the facts giving rise to any claim for indemnification hereunder, the amount or method of computation of the amount of such claim (if known) and such other information with respect thereto as the Indemnifying Party may reasonably request. The failure to provide such notice, however, shall not release the Indemnifying Party from any of its obligations under this Article VI except to the extent that the Indemnifying Party is prejudiced by such failure. The Indemnified Party shall reasonably cooperate and assist the Indemnifying Party in determining the validity of any claim for indemnity by the Indemnified Party and in otherwise resolving such matters. Such assistance and cooperation shall include providing reasonable access to and copies of information, records and documents relating to such matters, furnishing employees to assist in the investigation, defense and resolution of such matters and providing legal and business assistance with respect to such matters.

6.5 Limits on Indemnification.

(a) No claim may be asserted against either party for breach of any representation, warranty or covenant contained herein, unless written notice of such claim is received by such party, describing in reasonable detail the facts and circumstances with respect to the subject matter of such claim on or prior to the date on which the representation, warranty or covenant on which such claim is based ceases to survive as set forth in Section 6.1, in which case such representation, warranty or covenant shall survive as to such claim until such claim has been finally resolved.

(b) Notwithstanding anything to the contrary contained in this Agreement:

i. the maximum aggregate amount of indemnifiable Losses that may be recovered from the Sellers by Buyer Indemnified Parties pursuant to Section 6.2 shall be an amount equal to 15% multiplied by the aggregate total Base Consideration paid by the Seller for the acquisition of all of the Ritter Companies (the “Cap”); provided that any Losses resulting from breaches by the Seller of any of the Fundamental Representations shall not be subject to the Cap and such Losses shall not count towards satisfaction of the Cap; provided further, that the aggregate amount of all indemnifiable Losses that may be recovered from the Seller by Buyer Indemnified Parties pursuant to Section 6.2 (including with respect to any Losses resulting from breaches of any Fundamental Representation) shall not exceed the Purchase Price, as adjusted pursuant to Section 1.4;

ii. the Seller shall not be liable to any Buyer Indemnified Party for any claim for indemnification unless and until the aggregate amount of indemnifiable Losses that may be recovered from the Seller equals or exceeds an amount equal to 0.75% multiplied by the aggregate total Base Consideration paid by the Seller for the acquisition of all of the Ritter Companies (the “Basket Amount”), in which case the Seller shall be liable only for the Losses in excess of the Basket Amount; provided, however, that no Losses may be claimed by any Buyer Indemnified Party or shall be reimbursable by the Seller or shall be included in calculating the aggregate Losses for purposes of this clause (ii) other than Losses in excess of $25,000 (the “Minimum Loss Amount”) resulting from any single claim or aggregated claims arising out of the same facts, events or circumstances;

iii. in determining whether any claim for indemnification under this Agreement or any of the other Ritter Company Acquisition Agreements exceeds the Cap and/or the Basket Amount, the amount of all such claims under all of the Ritter Company Acquisition Agreements shall be aggregated;

iv. any payment for Losses claimed by any Buyer Indemnified Party shall be paid by the Sellers as follows (x) 70% of such Losses shall be paid in cash and (y) 30% of such Losses shall be paid by the surrender of Buyer common stock (valued at no less than the value assigned to such common stock under any of the Ritter Company Acquisition Agreements); provided that the Sellers may elect, at their sole option, to pay such Losses in cash only;

v. the Seller shall not be obligated to indemnify any Buyer Indemnified Party with respect to any Loss to the extent that a specific accrual or reserve for the amount of such Loss was reflected on the Financial Statements or the notes thereto;

vi. the Seller shall not be obligated to indemnify any Buyer Indemnified Party with respect to any Loss to the extent that the Buyer received a benefit from the reflection of such matter in the calculation of the adjustment of the Purchase Price, if any, as finally determined pursuant to Section 1.4;

vii. no party hereto shall have any liability under any provision of this Agreement for any punitive, incidental, consequential, special or indirect damages, including business interruption, loss of future revenue, profits or income, or loss of business reputation or opportunity relating to the breach or alleged breach of this Agreement; and

viii. in the event Buyer proceeds with the Closing notwithstanding actual knowledge by the Buyer or any Affiliate of Buyer at or prior to the Closing of any breach by the Seller of any representation, warranty or covenant in this Agreement, no Buyer Indemnified Party shall have any claim or recourse against the Seller or any of its Affiliates or Representatives with respect to such breach, under this Article VI or otherwise.

(c) For all purposes of this Article VI, “Losses” shall be net of (i) any insurance or other recoveries payable to the Indemnified Party or its Affiliates in connection with the facts giving rise to the right of indemnification and (ii) any Tax benefit available to such Indemnified Party or its Affiliates arising in connection with the accrual, incurrence or payment of any such Losses (including, without limitation, the net present value of any Tax benefit arising in subsequent taxable years).

(d) Buyer and the Sellers shall cooperate with each other with respect to resolving any claim, liability or Loss for which indemnification may be required hereunder, including by making, or causing the applicable Indemnified Party to make, all reasonable efforts to mitigate any such claim, liability or Loss. In the event that Buyer or the Sellers shall fail to make such reasonable efforts, then notwithstanding anything else to the contrary contained herein, the other party shall not be required to indemnify any Person for any claim, liability or Loss that could reasonably be expected to have been avoided if such efforts had been made. Without limiting the generality of the foregoing, Buyer and the Sellers shall, or shall cause the applicable Indemnified Party to, use reasonable efforts to seek full recovery under all insurance policies covering any Loss to the same extent as they would if such Loss were not subject to indemnification hereunder.

6.6 Assignment of Claims. If any Buyer Indemnified Party receives any payment from the Seller in respect of any Losses pursuant to Section 8.2 and the Buyer Indemnified Party could have recovered all or a part of such Losses from a third party (a "Potential Contributor") based on the underlying claim asserted against the Seller, the Buyer Indemnified Party shall assign, on a non-recourse basis and without any representation or warranty, such of its rights to proceed against the Potential Contributor as are necessary to permit the Seller to recover from the Potential Contributor the amount of such payment. If any such assignment would afford the Potential Contributor any defense to the payment of the same, such assignment shall not take place and the Buyer Indemnified Party will, at the Seller's direction and expense, take all reasonable actions to seek to recover such claim from such Potential Contributor. Any payment received in respect of such claim against the Potential Contributor (whether by the Seller or the relevant Buyer Indemnified Party as provided in the immediately preceding sentence) shall be distributed, (i) first, to the Buyer Indemnified Party in the amount of any deductible or similar amount required to be paid by the Buyer Indemnified Party prior to the Seller being required to make any payment to the Buyer Indemnified Party plus, in the case of any claim by a Buyer Indemnified Party as provided in the immediately preceding sentence, the costs and expenses incurred in investigating, prosecuting, defending or otherwise addressing such claim, (ii) second, to the Seller in an amount equal to the aggregate payments made by the Seller to the Buyer Indemnified Party in respect of such claim, plus the costs and expenses incurred in investigating, prosecuting, defending or otherwise addressing such claim and (iii) the balance, if any, to the Buyer Indemnified Party.

6.7 Exclusivity. Except as specifically set forth in this Agreement, effective as of the Closing, in the absence of fraud by the Sellers (to the extent determined by a final judgment by a court of competent jurisdiction), Buyer, on behalf of itself and the other Buyer Indemnified Parties, waives any rights and claims any Buyer Indemnified Party may have against the Sellers, whether in law or equity, relating to the Companies and/or the transactions contemplated hereby. The rights and claims waived by Buyer, on behalf of itself and the other Buyer Indemnified Parties, include, without limitation, claims for contribution or other rights of recovery arising out of or relating to any Environmental Laws, claims for breach of contract, breach of representation or warranty, negligent misrepresentation and all other claims for breach of duty. After the Closing, subject to the foregoing, this Article VI will provide the exclusive remedy against the Sellers for any breach of any representation, warranty, covenant or other claim arising out of or relating to this Agreement and/or the transactions contemplated hereby.

6.8 Tax Treatment of Indemnity Payments. All payments made pursuant to any indemnification obligations under this Agreement, will be treated as adjustments to the Purchase Price for Tax purposes and such agreed treatment will govern for purposes of this Agreement, unless otherwise required by applicable Laws.

6.9 Offset. Buyer will have the right to set off the indemnification obligations of the Sellers pursuant to this Article VI against any other payments, if any, due to the Sellers, whether under this Agreement or any other agreement among the Parties. No set off shall be permitted unless either (a) the Sellers have agreed in writing that it is liable for the relevant Losses or (b) if disputed, there has been a final, non-appealable award granting the relevant Buyer Indemnified Party such Losses.

ARTICLE VII - MISCELLANEOUS PROVISIONS

7.1 Expenses. The Parties will each bear their own costs and expenses relating to the negotiation and the implementation of the transactions contemplated hereby, including, without limitation, fees and expenses of legal counsel, accountants, investment bankers, brokers or finders, printers, copiers, consultants or other representatives, whether or not such transactions are consummated.

7.2 Amendment and Modification; Waivers; Third-Party Beneficiary. This Agreement may be amended, or any provision of this Agreement may be waived upon the approval, in a writing, executed by Buyer and the Sellers. This Agreement will not confer any rights or remedies upon any Person other than the Parties and their respective successors and permitted assigns, other than: (i) the Released Parties, who are intended third-party beneficiaries of the provisions set forth in Section 3.7, and (ii) the Buyer Indemnified Parties and Seller Indemnified Parties, who are intended third-party beneficiaries of the provisions set forth in Article VI. Any waiver or consent will be effective only in the specific instance and for the specific purpose for which it is given.

7.3 Notices. All notices, requests, demands and other communications required or permitted hereunder will be made in writing and will be deemed to have been duly given and effective: (a) on the date of delivery, if delivered personally; (b) on the first Business Day following the date of dispatch if delivered by a recognized next-day courier service; or (c) on the earlier of the fourth (4^th) day after mailing or the date of the return receipt acknowledgment, if mailed, postage prepaid, by certified mail, return receipt requested. All notices hereunder must be delivered to the following addresses:

If to Sellers:

Matthew L. Ritter

10313 Princeton Circle

Ellicott City, MD 21042

and

Michael J. Ritter

908 Glouster Circle

Hampstead, MD 21074

With copies to the following, which will not constitute notice:

Offit Kurman P.A.

4800 Montgomery Lane

9^th Floor

Bethesda, MD 20814

Attn: Michael Mercurio; Brent Salmons

If to Buyer or Parent:

EVO Transportation & Energy Services, Inc.

Attn: John Yeros, CEO

8285 West Lake Pleasant Parkway

Peoria, AZ 85382

With copies to the following, which will not constitute notice:

Fredrikson & Byron, P.A. 

200 South Sixth Street, Suite 4000 

Minneapolis, MN 55402-1425 

Attn: Frank B. Bennett; Patrick Seul

7.4 Assignment. This Agreement and all of the provisions hereof will be binding upon and inure to the benefit of the Parties hereto and their respective successors and permitted assigns, except that neither this Agreement nor any of the rights, interests or obligations under this Agreement may be assigned or delegated by any Party without the prior written consent of the other Parties, which consent will not be unreasonably withheld. Notwithstanding the foregoing, (i) Buyer may assign in whole or in part its rights pursuant to this Agreement to one or more of their Affiliates, (ii) Buyer may assign this Agreement and its rights and obligations under this Agreement in connection with a merger or consolidation involving Buyer, or in connection with a sale of substantially all of the equity or assets of Buyer or other disposition of substantially all of the Business provided the assignment will not relieve Buyer of its obligations pursuant to this Agreement, and (iii) Buyer may assign any or all of its rights pursuant to this Agreement or the Transaction Documents, including its rights to indemnification, to any of its lender(s) as collateral security.

7.5 Governing Law; Jurisdiction; Waiver of Jury Trial. This Agreement and the legal relations among the Parties hereto will be governed by and construed in accordance with the internal substantive Laws of the State of Delaware (without regard to the Laws of conflict that might otherwise apply) as to all matters, including without limitation matters of validity, construction, effect, performance and remedies. Each of the Parties hereto irrevocably submits to the exclusive jurisdiction of the courts of the State of Delaware and of the United States located in Delaware, for the purposes of any such action or other proceeding arising out of this Agreement or any transaction contemplated hereby. EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY PROCEEDING (WHETHER BASED IN CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR RELATING TO THIS AGREEMENT, THE OTHER TRANSACTION DOCUMENTS OR ANY TRANSACTION OR AGREEMENT CONTEMPLATED HEREBY OR THE ACTIONS OF ANY PARTY HERETO IN THE NEGOTIATION, ADMINISTRATION, PERFORMANCE OR ENFORCEMENT HEREOF. The Buyer and the Sellers specifically represent and warrant that they were represented by legal counsel and obtained legal advice regarding this Section 7.5 and other provisions of this Agreement.

7.6 Counterparts. is Agreement may be executed simultaneously with original, facsimile, or .pdf signatures in one or more counterparts, each of which will be deemed an original, but all of which together will constitute one and the same instrument.

7.7 Headings. The headings of the sections and subsections of this Agreement are inserted for convenience only and will not constitute a part hereof.

7.8 Entire Agreement. This Agreement and the exhibits and other writings referred to in this Agreement or any such exhibit or other writing are part of this Agreement, together embody the entire agreement and understanding of the Parties hereto in respect of the transactions contemplated by this Agreement. This Agreement supersedes all prior agreements and understandings between the Parties with respect to the transaction or transactions contemplated by this Agreement.

7.9 Severability. Provisions of this Agreement will be interpreted to be valid and enforceable under applicable Law to the extent that such interpretation does not materially alter this Agreement; provided, however, that if any such provision will become invalid or unenforceable under applicable Law such provision will be stricken to the extent necessary and the remainder of such provisions and the remainder of this Agreement will continue in full force and effect.

7.10 Cumulative Remedies; Specific Performance. All rights and remedies of a Party hereto are cumulative of each other and of every other right or remedy such Party may otherwise have at law or in equity, and the exercise of one or more rights or remedies will not prejudice or impair the concurrent or subsequent exercise of other rights or remedies. Each Pary will expressly be entitled to specific performance as a remedy.

7.11 Publicity. No Party will issue any press release or make any other public statement relating to the transactions contemplated hereby unless (a) agreed to by the other Parties hereto, or (b) required by Law or court order and any such release or statement will be subject to prior review by the other Parties hereto.

[Signature Page Follows]

IN WITNESS WHEREOF, the Parties hereto have caused this Membership Interest Purchase Agreement to be duly executed as of the day and year first above written.

Signature Page to Membership Interest Purchase Agreement

EXHIBIT A

Sellers

EXHIBIT B

DEFINITIONS

As used in this Agreement, the following terms will have the meanings indicated below.

“Affiliate” of any specified Person means any other Person directly or indirectly controlling or controlled by or under direct or indirect common control with such specified Person. For the purposes of this definition, “Control” or “Controlling” or “Controlled by” will mean, when used with respect to any specified Person, the power to direct the management and policies of such Person, directly or indirectly, whether through the ownership of voting securities, by Contract or otherwise.

“Business Day” means any day other than Saturday or Sunday on which banks are open for business in Phoenix, Arizona.

“Closing Date Net Working Capital” means, as of the Effective Time, the Current Assets minus the Current Liabilities, calculated in accordance with the Accounting Principles,

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

“Contracts” means all oral or written contracts, agreements, instruments and other documents to which a Person is a party or by which it or its assets is or are bound.

“Current Assets” means the current assets of the Ritter Companies, calculated in accordance with the Accounting Principles, and on a consolidated basis.

“Current Liabilities” means the current liabilities of the Ritter Companies, calculated in accordance with the Accounting Principles, and on a consolidated basis.

“DOT” means the United States Department of Transportation.

“Environmental Law” means all Laws: (a) relating to pollution (or the cleanup thereof) or the protection of natural resources, endangered or threatened species, or the environment (including ambient air, soil, surface water or groundwater, or subsurface strata); or (b) concerning the presence of, exposure to, or the management, manufacture, use, containment, storage, recycling, reclamation, reuse, treatment, generation, discharge, transportation, processing, production, disposal, or remediation of any Hazardous Substances. The term “Environmental Law” includes the following (including their implementing regulations, any state analogs or any similar laws in foreign jurisdictions): the Comprehensive Environmental Response, Compensation, and Liability Act of 1980, as amended by the Superfund Amendments and Reauthorization Act of 1986, 42 U.S.C. §§ 9601 et seq.; the Solid Waste Disposal Act, as amended by the Resource Conservation and Recovery Act of 1976, as amended by the Hazardous and Solid Waste Amendments of 1984, 42 U.S.C. §§ 6901 et seq.; the Federal Water Pollution Control Act of 1972, as amended by the Clean Water Act of 1976, as amended, 15 U.S.C. §§ 2601 et seq.; the Emergency Planning and Community Right to Know Act of 1986, 42 U.S.C. §§ 11001 et seq.; and the Clean Air Act of 1966, as amended by the Clean Air Act Amendments of 1990, 42 U.S.C. §§ 7401 et seq.

“GAAP” means U.S. generally accepted accounting principles, consistently applied.

“Government Bid” means any outstanding bid, offer or proposal which, if accepted or successful, would result in a Current Government Contract.

“Government Contract” means any prime contract, subcontract, purchase order, task order, delivery order, basic ordering agreement, pricing agreement, teaming agreement, letter contract, joint venture or other similar written arrangement between the Company, on the one hand, and (i) any Governmental Entity or (ii) any higher-tier contractor of a Governmental Entity in its capacity as a higher-tier contractor, on the other hand. A purchase order, a task order or a delivery order under a Government Contract shall not constitute a separate Government Contract, for purposes of this definition, but shall be part of the Government Contract to which it relates.

“Governmental Entity” means any court, administrative agency or commission, self-regulatory organization or other foreign, domestic, or quasi-governmental authority or instrumentality.

“Hazardous Substances” means all hazardous substances, as that term is defined in the Comprehensive Environmental Response, Compensation, and Liability Act (42 U.S.C. § 9601 et seq.), solid waste, hazardous waste and any other individual or class of pollutants, contaminants, toxins, chemicals, substances, wastes or materials in their solid, liquid or gaseous phase, defined, regulated, classified or identified under any Environmental Law, including without limitation petroleum, petroleum products, friable asbestos, molds, urea formaldehyde, radioactive materials and polychlorinated biphenyls.

“Indebtedness” means, with respect to any Person at any date, without duplication: (a) all obligations of such Person for borrowed money or in respect of loans or advances; (b) all obligations of such Person evidenced by bonds, debentures, notes or other similar instruments; (c) all obligations in respect of letters of credit, whether or not drawn, and bankers’ acceptances issued for the account of such Person; (d) all capital lease liabilities of such Person determined in accordance with GAAP; (e) all guarantees of such Person in connection with any of the foregoing; (f) any debt-like obligation or financing-type arrangement in respect of the deferred purchase price of property or property received as of the Closing with respect to which such Person is liable, contingently or otherwise, as obligor or otherwise; (g) any accrued interest, prepayment premiums or penalties or other costs or expenses related to any of the foregoing; and (h) all obligations or indebtedness of the Company owed to any Seller.

“Insider” means (a) any officer, director, or owner of the Company; (b) any individual related by blood, marriage or adoption to any individual listed in clause (a) hereof; or (c) any Person in which any individual listed in clauses (a) or (b) hereof has a beneficial interest.

“Knowledge” means the actual knowledge of such Person after reasonable inquiry, and “Knowledge” as it is applied to the Company, means the actual knowledge of Matthew Ritter and Michael Ritter, after reasonable inquiry.

“Law” means any federal, state, local, municipal, foreign, international, multinational, or other administrative order, constitution, law, ordinance, principle of common law, regulation, statute, or treaty.

“Liability” or “Liabilities” means any liability or obligation of whatever kind or nature (whether known or unknown, whether asserted or unasserted, whether absolute or contingent, whether accrued or unaccrued, whether liquidated or unliquidated, and whether due or to become due), including any liability for Taxes.

“Lien” means any mortgage, pledge, deed of trust, assignment, lien, charge, encumbrance, judgment, pledge or security interest of any kind or nature whatsoever or any claim of right of any third-party, or the interest of a vendor or lessor under any conditional sale Contract, capital lease or other title retention Contract.

“Losses” means any and all losses, Liabilities, damages, fees, direct and indirect damages (excluding consequential and incidental damages, lost profits, and punitive damages unless owed to a third party), and costs and expenses (including costs of investigation and defense and reasonable fees and expenses of lawyers, experts and other professionals).

“Material Adverse Effect” means any event, change, circumstance, occurrence, effect or state of facts that is or could reasonably be expected to be materially adverse to the business, assets, liabilities, condition (financial or otherwise), results of operations, or prospects of the Business.

“Material Contract” means:

(i) each Contract of the Company involving aggregate consideration in excess of $250,000;

(ii) all Contracts that require the Company to purchase its total requirements of any product or service from a third party or that contain “take or pay” provisions;

(iii) [intentionally omitted];

(iv) all Contracts that relate to the acquisition or disposition of any business, a material amount of stock or assets of any other Person or any real property (whether by merger, sale of stock, sale of assets or otherwise);

(v) all broker, distributor, dealer, manufacturer’s representative, franchise, agency, sales promotion, market research, marketing consulting and advertising Contracts to which the Company is a party;

(vi) all employment agreements and Contracts with independent contractors or consultants (or similar arrangements) that are not terminable by the Company on 60 days’ notice or less;

(vii) except for Contracts relating to trade receivables, all Contracts relating to Indebtedness;

(viii) all Government Contracts;

(ix) all Contracts that limit or purport to limit the ability of the Company to compete in any line of business or with any Person or in any geographic area or during any period of time;

(x) any Contracts to which the Company is a party that provide for any joint venture, partnership or similar arrangement by the Company;

(xi) all Contracts between or among the Company on the one hand and any Seller or any Affiliate of a Seller on the other hand;

(xii) all collective bargaining agreements or Contracts with any Union to which the Company is a party; and

(xiii) any other Contract that is material to the Company and not previously disclosed pursuant to subparts (i) – (xii).

“Ordinary Course of Business” means the ordinary course of the Business, consistent with past practice, including with regard to nature, frequency, and magnitude.

“Organizational Documents” means the articles or certificate of incorporation, bylaws, limited liability company agreement, partnership agreement or other governing documents of an entity.

“Outstanding Transaction Expenses” means fees and expenses incurred by the Companies or the Sellers on or prior to the Closing relating to the negotiation, execution and delivery of this Agreement and the other Transaction Documents.

“Permitted Liens” means (a) liens for current Taxes, assessments or other claims by a Governmental Entity not yet delinquent or the amount or validity of which is being contested in good faith by appropriate proceedings; (b) mechanics’, carriers’, workers’, repairers’ and similar Liens arising or incurred in the ordinary course of business that are not material to the Business; and (c) such other imperfections in title, charges, restrictions, or Liens that do not, individually or in the aggregate, materially detract from or diminish the value of or materially interfere with the present ownership, use and operation of such asset as used in the Business.

“Person” means any individual, corporation, partnership, joint venture, limited liability company, trust, unincorporated organization, Governmental Entity, or other legally recognized entity.

“Pre-Closing Tax Period” means any Tax period ending on or prior to the Closing Date and the portion of any Straddle Period up to and including the Closing Date.

“Related Party Transaction” means any Contract, arrangement, or understanding under which a Company or its Insiders (a) has borrowed any monies from or has outstanding any indebtedness or other similar obligations to the Company or its Affiliates; (b) owns any direct or indirect interest of any kind in, or is a director, officer, member, employee, partner, equity owner, consultant or lender to, or borrower from, or has the right to participate in the management, operations or profits of, any Person which is (i) a competitor, supplier, customer, distributor, lessor, tenant, creditor or debtor of a Company, or (ii) participates in any transaction to which a Company is a party; or (c) is or has been a party to any Contract, arrangement, understanding or transaction with a Company.

“Release” or “Released” will have the meaning specified in 42 U.S.C. § 9601.

“Ritter Companies” means the Company (i.e. Johmar Leasing Company, LLC), Ritter Transport, Inc.), and John W. Ritter, Inc.

“Ritter Company Acquisition Agreements” means, collectively, this Agreement and the other agreements entered into between the Parties on the same date hereof pursuant to which the Buyer is acquiring from the Sellers the other Ritter Companies.

“Tax Return” means all returns, declarations, reports, statements, computations and other documents required to be filed with any Governmental Entity in respect of Taxes.

“Taxes” means federal, state, county, local, foreign or other income, gross receipts, ad valorem, franchise, profits, sales or use, transfer, registration, excise, utility, environmental, communications, real or personal property, membership interest, license, payroll, wage or other withholding, employment, social security, severance, stamp, occupation, alternative or add-on minimum, estimated and other taxes of any kind whatsoever (including deficiencies, penalties, additions to tax, and interest attributable thereto) whether disputed or not.

EXHIBIT C-1

RESTATED LEASE

[See attached.]

EXHIBIT C-2

RESTATED LEASE

[See attached.]

EXHIBIT C-3

RESTATED LEASE

[See attached.]

EXHIBIT D

Form of Employment Agreement

[See attached.]

Exhibit 4.1

EXECUTION VERSION

$24,500,000

FINANCING AGREEMENT

dated as of September 16, 2019

among

EVO TRANSPORTATION & ENERGY SERVICES, INC. AND EACH SUBSIDIARY
THEREOF LISTED AS A BORROWER ON THE SIGNATURE PAGES HERETO,
as Borrowers,

ALL OTHER SUBSIDIARIES OF EVO TRANSPORTATION & ENERGY SERVICES, INC.
as Guarantors,

VARIOUS LENDERS FROM TIME TO TIME PARTY HERETO,

and

CORTLAND CAPITAL MARKET SERVICES LLC,
as Administrative Agent and Collateral Agent

TABLE OF CONTENTS

FINANCING AGREEMENT

This FINANCING AGREEMENT, dated as of September 16, 2019, is entered into by and among EVO TRANSPORTATION & ENERGY SERVICES, INC., a Delaware corporation (“Company”) and each subsidiary of the Company listed as a “Borrower” on the signature pages hereto (together with the Company and each other Person (as hereinafter defined) that executes a joinder agreement and becomes a “Borrower” hereunder, each a “Borrower” and collectively, the “Borrowers”), and all other Subsidiaries of Company, as Guarantors, the Lenders from time to time party hereto, and CORTLAND CAPITAL MARKET SERVICES LLC and its successors to serve as administrative agent and collateral agent under the Loan Documents (in such capacities, the “Administrative Agent” and the “Collateral Agent,” as applicable, and from time to time referred to herein without differentiation as an “Agent” and collectively as the “Agents”).

W I T N E S S E T H:

WHEREAS, capitalized terms used in the Preamble or these Recitals shall have the respective meanings set forth for such terms in Section 1.1 hereof;

WHEREAS, Lenders have agreed to extend a credit facility to Borrowers consisting of a term loan in an aggregate principal amount not exceeding $24,500,000, the proceeds of which will be used as described in Section 2.5 and which will be disbursed in multiple draws consisting of (x) $22,400,000 on the Closing Date and (y) Subsequent Draws of up to $2,100,000 in the aggregate prior to the Subsequent Draw Termination Date;

WHEREAS, each Borrower has agreed to secure all of its Obligations by granting to Collateral Agent, for the benefit of Secured Parties, a Lien on all of its assets (subject to the prior preferred Lien of the Equipment Collateral Agent in the Equipment Priority Collateral and/or the A/R Collateral Agent in the A/R Priority Collateral and to the extent permitted by the A/R Loan Agreements and the Equipment Loan Agreements), including a pledge of all of the Capital Stock of each of its Subsidiaries; and

WHEREAS, Guarantors have agreed to guarantee the obligations of Borrowers hereunder and to secure their respective Obligations by granting to Collateral Agent, for the benefit of Secured Parties a Lien on all of its assets (subject to the prior preferred Lien of the Equipment Collateral Agent in the Equipment Priority Collateral and/or the A/R Collateral Agent in the A/R Priority Collateral and to the extent permitted by the A/R Loan Agreements and the Equipment Loan Agreements), including a pledge of all of the Capital Stock of each of their respective Subsidiaries.

NOW, THEREFORE, in consideration of the premises and the agreements, provisions and covenants herein contained, the parties hereto agree as follows:

Article I

DEFINITIONS AND INTERPRETATION

Section 1.1. Definitions. The following terms used herein, including in the preamble, recitals, exhibits and schedules hereto, shall have the following meanings:

“A/R Administrative Agent” means administrative agent, or if none, the secured party under each A/R Credit Agreement and its successors and assigns.

“A/R Collateral Agent” means the collateral agent, or if none, the secured party under each A/R Credit Agreement and its successors and assigns.

“A/R Credit Agreement” means the factoring agreements (A) identified on Appendix C, as in effect on the Closing Date, as the same may be amended, modified, supplemented, replaced, renewed or refinanced from time to time in accordance with the terms of this Agreement and any Intercreditor Agreement and (B) entered into after the Closing Date by Finkle Transport, Inc. and/or Courtlandt & Brown Enterprises, L.L.C. on terms substantially similar to the terms of the existing A/R Credit Agreements.

“A/R Indebtedness” means the Indebtedness of Company and its Subsidiaries owing to the A/R Administrative Agent, the A/R Collateral Agent and the A/R Lenders under the A/R Credit Agreement.

“A/R Lenders” means the lenders from time to time party to the A/R Credit Agreement.

“A/R Loan Documents” means all agreements, instruments, and other documents executed and delivered pursuant to the A/R Credit Agreement, and including such applicable A/R Credit Agreement, each as in effect on the Closing Date, as the same may be amended, modified, supplemented, replaced, renewed or refinanced from time to time in accordance with the terms of this Agreement and any Intercreditor Agreement.

“A/R Loans” means the loans made pursuant to the A/R Credit Agreement.

“A/R Priority Collateral” means “Collateral” as defined in the A/R Loan Agreements.

“Additional Credit Extension Amendment” shall mean an amendment to this Agreement (which may, at the option of the Administrative Agent and the Required Lenders, be in the form of an amendment and restatement of this Agreement) providing for any Incremental Term Loans pursuant to Section 2.23, which shall be consistent with the applicable provisions of this Agreement and otherwise satisfactory to the parties thereto. Each Additional Credit Extension Amendment shall be executed by the Administrative Agent, the Required Lenders, the Borrower and the Incremental Term Loan Lenders (but not any other Lender). Any Additional Credit Extension Amendment may include conditions for delivery of opinions of counsel and other documentation consistent with the conditions in Section 3.1, all to the extent reasonably requested by the Administrative Agent or the other parties to such Additional Credit Extension Amendment.

“Administrative Agent” has the meaning specified in the preamble hereto.

“Administrative Agent’s Account” means an account at a bank designated by Administrative Agent from time to time as the account into which the Loan Parties shall make all payments to Administrative Agent under this Agreement and the other Loan Documents.

“Adverse Proceeding” means any action, suit, proceeding (whether administrative, judicial or otherwise), governmental investigation or arbitration (whether or not purportedly on behalf of Company or any of its Subsidiaries) at law or in equity, or before or by any Governmental Authority, domestic or foreign (including any Environmental Claims) or other regulatory body or any mediator or arbitrator, whether pending or, to the knowledge of Company or any of its Subsidiaries, threatened against or affecting Company or any of its Subsidiaries or any property of Company or any of its Subsidiaries.

“Affiliate” means, as applied to any Person, any other Person directly or indirectly controlling (including any member of the senior management group of such Person), controlled by, or under common control with, that Person. For the purposes of this definition, “control” (including, with correlative meanings, the terms “controlling,” “controlled by” and “under common control with”), as applied to any Person, means the possession, directly or indirectly, of the power (a) to vote 10% or more of the Securities having ordinary voting power for the election of members of the Board of Directors (or similar governing body or Persons performing similar governing functions) of such Person, or (b) to direct or cause the direction of the management and policies of such Person, whether through the ownership of voting securities or by contract or otherwise. Notwithstanding anything herein to the contrary, in no event shall any Agent or any Lender or any of their Affiliates or Related Funds be considered an “Affiliate” of any Loan Party.

“Agent” and “Agents” have the meaning specified in the Preamble.

“Aggregate Amounts Due” has the meaning specified in Section 2.16.

“Aggregate Payments” has the meaning specified in Section 7.2.

“Agreement” means this Financing Agreement and any annexes, exhibits and schedules attached hereto as it may be amended, supplemented or otherwise modified from time to time.

“Antara Capital” has the meaning specified in the definition of “Warrant Agreement”.

“Anti-Terrorism Laws” means any Requirement of Law relating to terrorism or money laundering, including, without limitation, (a) the Money Laundering Control Act of 1986 (i.e., 18 U.S.C. §§ 1956 and 1957), (b) the Currency and Foreign Transactions Reporting Act (31 U.S.C. §§ 5311-5330 and 12 U.S.C. §§ 1818(s), 1820(b) and 1951-1959) (the “Bank Secrecy Act”), (c) the USA Patriot Act, (d) the laws, regulations and Executive Orders administered by the United States Department of the Treasury’s Office of Foreign Assets Control (“OFAC”), (e) the Comprehensive Iran Sanctions, Accountability, and Divestment Act of 2010 and implementing regulations by the United States Department of the Treasury, (f) any applicable law prohibiting or directed against terrorist activities or the financing of terrorist activities (e.g., 18 U.S.C. §§ 2339A and 2339B), or (g) any similar laws enacted in the United States or any other jurisdictions in which the parties to this Agreement operate, as any of the foregoing laws may from time to time be amended, renewed, extended, or replaced and all other present and future applicable legal requirements of any Governmental Authority governing, addressing, relating to, or attempting to eliminate, terrorist acts and acts of war and any regulations promulgated pursuant thereto.

“Application Event” the (a) occurrence of an Event of Default and (b) the election by Collateral Agent or the Required Lenders during the continuance of such Event of Default to require that payments and proceeds of Collateral be applied pursuant to Section 2.15(h).

“Arm’s Length Terms” means, as of any applicable time of determination, terms no less favorable to Borrowers and/or any applicable Subsidiary thereof than those terms that would be obtainable in an arm’s length transaction between unaffiliated and disinterested Persons in a transaction in which neither Person is under undue pressure to complete such transaction.

“Asset Sale” means a sale, lease or sub lease (as lessor or sublessor), sale and leaseback, assignment, conveyance, transfer, license or other disposition to (other than to or with a Loan Party which is not Company), or any exchange of property with, any Person, in one transaction or a series of transactions, of all or any part of any Loan Party’s businesses, assets or properties of any kind, whether real, personal, or mixed and whether tangible or intangible, whether now owned or hereafter acquired, including, without limitation, the Capital Stock of any Loan Party, other than inventory sold, inventory licensed in the ordinary course of business or inventory leased in the ordinary course of business. For purposes of clarification, “Asset Sale” shall (x) include (a) the sale or other disposition for value of any contracts, (b) the early termination or modification of any contract resulting in the receipt by any Loan Party of a Cash payment or other consideration in exchange for such event (other than payments in the ordinary course for accrued and unpaid amounts due through the date of termination or modification), (c) the sale of any truck, tractor, trailer, or other vehicle, or spare parts for any of the foregoing, whether or not obsolete or surplus, and (d), any sale of merchant accounts (or any rights thereto (including, without limitation, any rights to any residual payment stream with respect thereto)) by any Loan Party and (y) exclude any CNG Asset Sale and any factoring transaction in respect of accounts receivable of any Loan Party to the extent such factoring transaction is permitted under this Agreement .

“Assignment Agreement” means an Assignment and Assumption Agreement substantially in the form of Exhibit D, with such amendments or modifications as may be approved by Administrative Agent.

“Authorized Officer” means, as applied to any Person, any individual holding the position of chairman of the board (if an officer), chief executive officer, president or one of its vice presidents (or the equivalent thereof), and such Person’s chief financial officer or treasurer.

“Bail-In Action” shall mean the exercise of any Write-Down and Conversion Powers by the applicable EEA Resolution Authority in respect of any liability of an EEA Financial Institution.

“Bail-In Legislation” shall mean, with respect to any EEA Member Country implementing Article 55 of Directive 2014/59/EU of the European Parliament and of the Council of the European Union, the implementing law for such EEA Member Country from time to time which is described in the EU Bail-In Legislation Schedule.

“Bank Secrecy Act” has the meaning specified in the definition of “Anti-Terrorism Laws”.

“Bankruptcy Code” means Title 11 of the United States Code entitled “Bankruptcy,” as now and hereafter in effect, or any successor statute.

“Beneficiary” means each Agent and Lender.

“Blocked Person” means any Person:

(a) that is publicly identified (i) on the most current list of “Specially Designated Nationals and Blocked Persons” published by OFAC or resides, or is organized or chartered in a country or territory subject to comprehensive OFAC Sanctions Programs or OFAC embargo program or (ii) as prohibited from doing business with the United States under the International Emergency Economic Powers Act, the Trading With the Enemy Act, or any other Anti-Terrorism Law;

(b) that is owned or controlled by, or that is acting for or on behalf of, any Person described in clause (a) above; or

(c) which any Lender is prohibited from dealing or otherwise engaging in any transaction by any Anti-Terrorism Law.

“Board of Directors” means, (a) with respect to any corporation, the board of directors of the corporation or any committee thereof duly authorized to act on behalf of such board, (b) with respect to a partnership, the board of directors of the general partner of the partnership, (c) with respect to a limited liability company, the managing member or members or any controlling committee or board of directors of such company or the sole member or the managing member thereof, and (d) with respect to any other Person, the board or committee of such Person serving a similar function.

“Borrower” and “Borrowers” have the respective meanings specified in the preamble hereto.

“Business Day” means any day excluding Saturday, Sunday and any day which is a legal holiday under the laws of the State of New York or is a day on which banking institutions located in either such state are authorized or required by law or other Governmental Act to close.

“Capital Asset” means, with respect to the Company and its Subsidiaries, any asset that should, in accordance with GAAP, be classified and accounted for as a capital asset on a consolidated balance sheet of the Company and its Subsidiaries.

“Capital Expenditures” means, with respect to the Company and its Subsidiaries for any period, the aggregate cost of all Capital Assets acquired by the Company and its Subsidiaries during such period, as determined in accordance with GAAP.

“Capital Lease” means, as applied to any Person, any lease of any property (whether real, personal or mixed) by that Person (a) as lessee that, in conformity with GAAP, is or should be accounted for as a capital lease on the balance sheet of that Person or (b) as lessee which is a transaction of a type commonly known as a “synthetic lease” (i.e., a transaction that is treated as an operating lease for accounting purposes but with respect to which payments of rent are intended to be treated as payments of principal and interest on a loan for Federal income tax purposes).

“Capital Stock” means any and all shares, interests, participations or other equivalents (however designated) of capital stock of a corporation, any and all equivalent ownership interests in a Person (other than a corporation), including, without limitation, partnership interests and membership interests, and any and all warrants, rights or options to purchase or other arrangements or rights to acquire any of the foregoing.

“Cash” means money, currency or a credit balance in any demand or Deposit Account.

“Cash Equivalents” means, as at any date of determination, (a) marketable securities (i) issued or directly and unconditionally guaranteed as to interest and principal by the United States Government, or (ii) marketable securities issued by any agency of the United States the obligations of which are backed by the full faith and credit of the United States, in each case maturing within one year after such date; (b) marketable direct obligations issued by any state of the United States of America or any political subdivision of any such state or any public instrumentality thereof, in each case maturing within one year after such date and having, at the time of the acquisition thereof, a rating of at least A 1 from S&P or at least P 1 from Moody’s; (c) commercial paper maturing no more than one year from the date of creation thereof and having, at the time of the acquisition thereof, a rating of at least A 1 from S&P or at least P 1 from Moody’s; (d) certificates of deposit or bankers’ acceptances maturing within one year after such date and issued or accepted by any Lender or by any commercial bank organized under the laws of the United States of America or any state thereof or the District of Columbia that (i) is at least “adequately capitalized” (as defined in the regulations of its primary Federal banking regulator), and (ii) has Tier 1 capital (as defined in such regulations) of not less than $100,000,000; and (e) shares of any money market mutual fund that (i) has substantially all of its assets invested continuously in the types of investments referred to in clauses (a) and (b) above, (ii) has net assets of not less than $500,000,000, and (iii) has the highest rating obtainable from either S&P or Moody’s.

“Certificate Regarding Non-Bank Status” means a certificate substantially in the form of Exhibit E.

“Change of Control” means, at any time, any of the following occurrences:

(a) the Permitted Holders shall cease to beneficially own and control, collectively, at least 50.1% on a fully diluted basis of the economic and voting interests in the Capital Stock of Company except as the direct result of (i) a repurchase by Company of Capital Stock issued by it, however such repurchase is denominated, or (ii) a transfer of Capital Stock issued by Company to a Loan Party, however such transfer is denominated, and in the case of (i) or (ii), the repurchased or transferred Capital Stock issued by Company is immediately extinguished;

(b) Company shall cease to beneficially own and control, directly or indirectly, 100% on a fully diluted basis of the economic and voting interest in the Capital Stock of each other Loan Party (other than as a result of any sale or other disposition of all Capital Stock of a Loan Party permitted under this Agreement).

“Change of Control Offer” has the meaning provided in Section 2.13(e).

“Change of Control Payment” has the meaning provided in Section 2.13(e).

“Change of Control Payment Date” has the meaning provided in Section 2.13(e).

“Closing Date” means the date on which the initial $22,400,000 Term Loan is made hereunder.

“Closing Date Certificate” means a Closing Date Certificate substantially in the form of Exhibit F-1.

“CNG Asset Sale” means the sale by any Loan Party of a compressed natural gas fueling station.

“Collateral” means, collectively, all of the real, personal and mixed property (including Capital Stock) and all interests therein and proceeds thereof now owned or hereafter acquired by any Person upon which a Lien is granted or purported to be granted by such Person pursuant to the Collateral Documents as security for the Obligations.

“Collateral Agent” has the meaning specified in the preamble hereto.

“Collateral Access Agreement” means a collateral access agreement in form and substance satisfactory to Collateral Agent.

“Collateral Documents” means the Pledge and Security Agreement, the Mortgages, the Collateral Access Agreements, if any, any Control Agreement, and all other instruments, documents and agreements delivered by any Loan Party pursuant to this Agreement or any of the other Loan Documents in order to grant to Collateral Agent, for the benefit of Secured Parties, a Lien on any real, personal or mixed property of that Loan Party as security for the Obligations, in each case, as such Collateral Documents may be amended or otherwise modified from time to time.

“Commitment” means any Term Loan Commitment.

“Company” has the meaning specified in the preamble hereto.

“Compliance Certificate” means a Compliance Certificate substantially in the form of Exhibit C.

“Consolidated EBITDA” means, for any period of determination, an amount determined for Company and its Subsidiaries on a consolidated basis for the most recently reported four fiscal quarter period (provided that for the first three Fiscal Quarters of the Fiscal Year ending on December 31, 2020, Consolidated EBITDA shall be calculated as the cumulative results for such Fiscal Year and rather than on a rolling four quarter basis) equal to:

(a) the sum, without duplication, of the amounts for such most recently reported four fiscal quarter period of

(i) Consolidated Net Income, plus

(ii) Consolidated Interest Expense, plus

(iii) provisions for taxes based on income, plus

(iv) total depreciation expense, plus

(v) total amortization expense, plus

(vi) other non-Cash items reducing Consolidated Net Income for most recently reported twelve consecutive month period (excluding herefrom any such non-Cash item to the extent that it represents an accrual or reserve for potential Cash items in any future period or amortization of a prepaid Cash item that was paid in a prior period), plus

(vii) fees, costs and expenses (to the extent such fees, costs or expenses cannot be capitalized) incurred during the most recently reported period in connection with any proposed or actual issuance of any Capital Stock or Indebtedness permitted hereunder, or any proposed or actual investments, Asset Sales or divestitures permitted hereunder, provided that the fees, costs and expenses described in this clause may only be added back to Consolidated EBITDA to the extent of $500,000 in the aggregate during the most recently reported four fiscal quarter period less the amount of actual add-backs included under clauses (xi), (xii) during such period, and clause (viii) since the Closing Date, and such fees, costs and expenses are reasonably identifiable, factually supportable, and certified by the chief financial officer of the Company,

(viii) fees, costs and expenses (to the extent such fees, costs or expenses cannot be capitalized) incurred during the most recently reported period in connection with entity rationalization, legal, tax and structuring costs and expenses for professional services and filing fees directly incurred in connection with any merger, consolidation, liquidation, dissolution or disposition permitted hereunder, provided that the fees, costs and expenses described in this clause may only be added back to Consolidated EBITDA to the extent of $500,000 per the most recently reported four fiscal quarter period occurring entirely after the Closing Date during the term of this Agreement and such fees, costs and expenses are reasonably identifiable, factually supportable, and certified by the chief financial officer of the Company, plus

(ix) [Reserved], plus

(x) [Reserved], plus

(xi) any severance, to the extent in the most recently reported period of the remainder of five percent (5%) of Consolidated EBITDA for such period less the amount of actual add-backs included under clauses (vii) and (xii) during such period and clause (viii) since the Closing Date and such severance is reasonably identifiable, factually supportable, and certified by the chief financial officer of the Company, plus

(xii) any restructuring, integration, transition or business optimization costs in an aggregate amount not to exceed in the most recently reported period $2,000,000 in the aggregate during such most recently reported twelve consecutive month period less the amount of actual add-backs included under clauses (vii) and (xi) during such most recently reported four fiscal quarter period and clause (viii) since the Closing Date and such fees, costs and expenses are reasonably identifiable, factually supportable, and certified by the chief financial officer of the Company, minus

(b) the sum, without duplication of the amounts for such most recently reported period of (i) other non-Cash items increasing Consolidated Net Income for such period (excluding any such non-Cash item to the extent it represents the reversal of an accrual or reserve for potential Cash item in any prior period), plus (ii) interest income, plus (iii) gains arising out of discontinued operations.

Borrower shall include in each Compliance Certificate a description of the utilization of clauses (vii), (viii), (xi) and (xii) in the period being so reported, including computation of the available amount of Consolidated EBITDA utilized under such cap during such period.

“Consolidated Interest Expense” means, for any period, total interest expense (including that portion attributable to Capital Leases in accordance with GAAP and capitalized interest) of Company and its Subsidiaries on a consolidated basis with respect to all outstanding Consolidated Total Debt, including all commissions, discounts and other fees and charges owed with respect to letters of credit and net costs under Interest Rate Agreements, but excluding, however, any amounts referred to in Section 2.10 payable on or before the Closing Date.

“Consolidated Net Income” means, for any period, the net income (or loss) of Company and its Subsidiaries on a consolidated basis for such period taken as a single accounting period determined in conformity with GAAP.

“Consolidated Revenue” means, for any period, (a) the revenue of Company and its Subsidiaries on a consolidated basis for such period taken as a single accounting period determined in conformity with GAAP.

“Consolidated Total Debt” means, as at any date of determination for any Person, the sum of (x) aggregate principal amount (or stated balance sheet amount, if larger) of all Indebtedness of such Person and its Subsidiaries determined on a consolidated basis in accordance with GAAP plus (y) all original issue discount in respect of such Indebtedness, to the extent that an amount equal to such original issue discount was eliminated from Indebtedness in accordance with GAAP.

“Contractual Obligation” means, as applied to any Person, any provision of any Security issued by that Person or of any indenture, mortgage, deed of trust, contract, undertaking, agreement or other instrument to which that Person is a party or by which it or any of its properties is bound or to which it or any of its properties is subject.

“Control Agreement” means a control agreement, in form and substance satisfactory to Collateral Agent, executed and delivered by Company or one of its Subsidiaries, Collateral Agent, and the applicable securities intermediary (with respect to a Securities Account) or bank (with respect to a Deposit Account).

“Controlled Investment Affiliate” means, as to any Person, any other Person that (a) directly or indirectly, is in control of, is controlled by, or is under common control with, such Person and (b) is organized primarily for the purpose of making equity or debt investments in one or more companies in the ordinary course of its business and that is administered, managed, underwritten, advised or sub-advised by such Person. For purposes of this definition, “control” of a Person means the power, directly or indirectly, to direct or cause the direction of the management and policies of such Person whether by contract or otherwise.

“Counterpart Agreement” means a Counterpart Agreement substantially in the form of Exhibit G delivered by a Loan Party pursuant to Section 5.10.

“Credit Date” means the date of a Credit Extension.

“Credit Extension” means the making of a Loan.

“Debtor Relief Law” means the Bankruptcy Code and any other liquidation, conservatorship, bankruptcy, assignment for the benefit of creditors, moratorium, rearrangement, receivership, insolvency, reorganization, or similar debtor relief law of the United States or other applicable jurisdiction from time to time in effect.

“Default” means a condition or event that, after notice or lapse of time or both, would constitute an Event of Default.

“Default Excess” means, with respect to any Defaulting Lender, the excess, if any, of such Defaulting Lender’s Pro Rata Share of the aggregate outstanding principal amount of Loans of all Lenders (calculated as if all Defaulting Lenders (other than such Defaulting Lender) had funded all of their respective Defaulted Loans) over the aggregate outstanding principal amount of all Loans of such Defaulting Lender.

“Default Period” means, with respect to any Defaulting Lender, the period commencing on the date of the applicable Funding Default and ending on the earliest of the following dates: (a) the date on which all Commitments are cancelled or terminated and/or the Obligations are declared or become immediately due and payable, (b) the date on which (i) the Default Excess with respect to such Defaulting Lender shall have been reduced to zero (whether by the funding by such Defaulting Lender of any Defaulted Loans of such Defaulting Lender or by the non pro rata application of any voluntary or mandatory prepayments of the Loans in accordance with the terms of Section 2.12 or Section 2.13 or by a combination thereof), and (ii) such Defaulting Lender shall have delivered to Company and Administrative Agent a written reaffirmation of its intention to honor its obligations hereunder with respect to its Commitments, and (c) the date on which Borrowers, Administrative Agent and Required Lenders waive all Funding Defaults of such Defaulting Lender in writing.

“Defaulted Loan” has the meaning specified in Section 2.21.

“Defaulting Lender” has the meaning specified in Section 2.21.

“Default Rate” means any interest payable pursuant to Section 2.9.

“Deposit Account” means a demand, time, savings, passbook or like account with a bank, savings and loan association, credit union or like organization, other than an account evidenced by a negotiable certificate of deposit.

“Disqualified Capital Stock” means any Capital Stock that, by its terms (or by the terms of any security or other Capital Stock into which it is convertible or for which it is exchangeable), or upon the happening of any event or condition, (a) matures or is mandatorily redeemable, pursuant to a sinking fund obligation or otherwise, (b) is redeemable at the option of the holder thereof, in whole or in part, (c) provides for the scheduled payments of dividends or distributions in Cash, or (d) is convertible into or exchangeable for (i) Indebtedness or (ii) any other Capital Stock that would constitute Disqualified Capital Stock, in each case of clauses (a) through (d), prior to the date that is 91 days after the latest Term Loan Maturity Date.

“Dollars” and the sign “$” mean the lawful money of the United States of America.

“Early Prepayment” has the meaning set forth in Section 2.12(c).

“EEA Financial Institution” shall mean (a) any credit institution or investment firm established in any EEA Member Country which is subject to the supervision of an EEA Resolution Authority, (b) any entity established in an EEA Member Country which is a parent of an institution described in clause (a) of this definition, or (c) any financial institution established in an EEA Member Country which is a subsidiary of an institution described in clauses (a) or (b) of this definition and is subject to consolidated supervision with its parent.

“EEA Member Country” shall mean any of the member states of the European Union, Iceland, Liechtenstein, and Norway.

“EEA Resolution Authority” shall mean any public administrative authority or any Person entrusted with public administrative authority of any EEA Member Country (including any delegee) having responsibility for the resolution of any EEA Financial Institution.

“Eligible Assignee” means (i) any Lender, any Affiliate of any Lender and any Related Fund (any two or more Related Funds being treated as a single Eligible Assignee for all purposes hereof), and (ii) any commercial bank, insurance company, investment or mutual fund or other entity that is an “accredited investor” (as defined in Regulation D under the Securities Act) and which extends credit or buys loans as one of its businesses, and (c) any other Person (other than a natural Person) approved by Collateral Agent; provided (i) neither (A) Company nor any Affiliate of Company nor (B) the Permitted Holders nor any Affiliate of the Permitted Holders shall, in any event, be an Eligible Assignee, and (ii) no Person owning or controlling any trade debt or Indebtedness of any Loan Party other than the Obligations (including, but not limited to, any Equipment Indebtedness or A/R Indebtedness) or any Capital Stock of any Loan Party (in each case, unless approved by Collateral Agent) shall, in any event, be an Eligible Assignee and each assignee will so represent in the Assignment and Assumption.

“Employee Benefit Plan” means any “employee benefit plan” as defined in Section 3(3) of ERISA (other than any Multiemployer Plan) which is sponsored, maintained or contributed to by, or required to be contributed by, any Loan Party or any of its ERISA Affiliates.

“Environmental Claim” means any complaint, summons, citation, investigation, notice, directive, notice of violation, order, claim, demand, action, litigation, judicial or administrative proceeding, judgment, letter or other communication from any Governmental Authority or any other Person, involving (a) any actual or alleged violation of any Environmental Law; (b) any Hazardous Material or any actual or alleged Hazardous Materials Activity; (c) injury to the environment, natural resource, any Person (including wrongful death) or property (real or personal) in connection with Hazardous Materials or actual or alleged violations of Environmental Laws; or (d) actual or alleged Releases or threatened Releases of Hazardous Materials either (i) on, at or migrating from any assets, properties or businesses currently or formerly owned or operated by any Loan Party or any of its Subsidiaries or any predecessor in interest, (ii) from adjoining properties or businesses, or (iii) onto any facilities which received Hazardous Materials generated by any Loan Party or any of its Subsidiaries or any predecessor in interest.

“Environmental Laws” means any and all current or future foreign or domestic, federal or state (or any subdivision of either of them), statutes, ordinances, orders, rules, regulations, judgments, decrees, permits, licenses or binding determinations of any Governmental Authorizations, or any other requirements of Governmental Authorities relating to (a) the manufacture, generation, use, storage, transportation, treatment, disposal or Release of Hazardous Materials; or (b) occupational safety and health, industrial hygiene, land use or the protection of the environment, human, plant or animal health or welfare.

“Environmental Liabilities and Costs” means all liabilities, monetary obligations, losses (including monies paid in settlement), damages, punitive damages, natural resources damages, consequential damages, treble damages, costs and expenses (including all reasonable fees, disbursements and expenses of counsel, experts and consultants and costs of investigations and feasibility studies), fines, penalties, sanctions and interest incurred in connection with any Remedial Action, any Environmental Claim, or any other claim or demand by any Governmental Authority or any Person that relates to any actual or alleged violation of Environmental Laws, actual or alleged exposure or threatened exposure to Hazardous Materials, or any actual or alleged Release or threatened Release of Hazardous Materials.

“Environmental Lien” means any Lien in favor of any Governmental Authority for Environmental Liabilities and Costs.

“Equipment Administrative Agent” means administrative agent, or if none, the secured party under each Equipment Credit Agreement and its successors and assigns.

“Equipment Collateral Agent” means the collateral agent, or if none, the secured party under each Equipment Credit Agreement and its successors and assigns.

“Equipment Credit Agreement” means the equipment financing loans and finance leases identified on Appendix D, as in effect on the Closing Date, as the same may be amended, modified, supplemented, replaced, renewed or refinanced from time to time in accordance with the terms of this Agreement and any Intercreditor Agreement.

“Equipment Indebtedness” means the Indebtedness of Company and its Subsidiaries owing to the Equipment Administrative Agent, the Equipment Collateral Agent and the Equipment Lenders under the Equipment Credit Agreement.

“Equipment Lenders” means the lenders from time to time party to the Equipment Credit Agreement.

“Equipment Loan Documents” means all agreements, instruments, and other documents executed and delivered pursuant to the Equipment Credit Agreement, including such applicable Equipment Loan Agreement, each as in effect on the Closing Date, as the same may be amended, modified, supplemented, replaced, renewed or refinanced from time to time in accordance with the terms of this Agreement and any Intercreditor Agreement.

“Equipment Loans” means the loans made pursuant to the Equipment Credit Agreement.

“Equipment Priority Collateral” means “Collateral” as defined in the Equipment Loan Documents.

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended from time to time, and any successor thereto.

“ERISA Affiliate” means, as applied to any Person, (a) any corporation which is a member of a controlled group of corporations within the meaning of Section 414(b) of the Internal Revenue Code of which that Person is a member; (b) any trade or business (whether or not incorporated) which is a member of a group of trades or businesses under common control within the meaning of Section 414(c) of the Internal Revenue Code of which that Person is a member; and (c) any member of an affiliated service group within the meaning of Section 414(m) or (o) of the Internal Revenue Code of which that Person, any corporation described in clause (a) above or any trade or business described in clause (b) above is a member. Any former ERISA Affiliate of a Person shall continue to be considered an ERISA Affiliate of such Person within the meaning of this definition with respect to the period such entity was an ERISA Affiliate of Person and with respect to liabilities arising during such period (but, for the avoidance of doubt, not after such period) for which such Person would be liable under the Internal Revenue Code or ERISA.

“Escrow Agent” means Cortland Capital Market Services LLC acting in its capacity as Escrow Agent under the Escrow Agreement.

“Escrow Agreement” means that certain Escrow Agreement, dated as of September 16, 2019, entered into by and among Escrow Agent, Company and Administrative Agent, substantially in the form of Exhibit K hereto.

“ERISA Event” means (a) a “reportable event” within the meaning of Section 4043 of ERISA and the regulations issued thereunder with respect to any Pension Plan (excluding those for which the provision for notice to the PBGC has been waived by regulation); (b) the failure by any Loan Party or any ERISA Affiliate to meet the minimum funding standard of Section 412 of the Internal Revenue Code with respect to any Pension Plan (whether or not waived in accordance with Section 412(d) of the Internal Revenue Code) or the failure by any Loan Party or any ERISA Affiliate to make by its due date a required installment under Section 412(m) of the Internal Revenue Code with respect to any Pension Plan or the failure by any Loan Party or any ERISA Affiliate to make any required contribution to a Multiemployer Plan under Section 431 or 432 of the Internal Revenue Code; (c) the receipt by any Loan Party or any ERISA Affiliate from the administrator of any Pension Plan pursuant to Section 4041(a)(2) of ERISA of a notice of intent to terminate such plan in a distress termination described in Section 4041(c) of ERISA; (d) the withdrawal by a Loan Party or any of its ERISA Affiliates from any Pension Plan with two or more contributing sponsors or the termination of any such Pension Plan resulting in liability to any Loan Party or any of its ERISA Affiliates pursuant to Section 4063 or 4064 of ERISA; (e) the institution by the PBGC of proceedings to terminate any Pension Plan, or the occurrence of any event or condition which would reasonably be expected to constitute grounds under ERISA for the termination of, or the appointment of a trustee to administer, any Pension Plan; (f) the imposition of liability on any Loan Party or any of its ERISA Affiliates pursuant to Section 4062(e) or 4069 of ERISA or by reason of the application of Section 4212(c) of ERISA; (g) the withdrawal of any Loan Party or any of its ERISA Affiliates in a complete or partial withdrawal (within the meaning of Sections 4203 and 4205 of ERISA) from any Multiemployer Plan if there is any liability therefor, or the receipt by any Loan Party or any of its ERISA Affiliates of notice from any Multiemployer Plan that it is in insolvency pursuant to Section 4245 of ERISA, or that it intends to terminate or has terminated under Section 4041A or 4042 of ERISA; (h) the assertion of a material claim (other than routine claims for benefits) against any Employee Benefit Plan or the assets thereof, or against any Loan Party or any of its ERISA Affiliates in connection with any Employee Benefit Plan;; or (i) the imposition of a Lien pursuant to Section 401(a)(29) or 412(n) of the Internal Revenue Code or pursuant to ERISA with respect to any Pension Plan.

“EU Bail-In Legislation Schedule” shall mean the EU Bail-In Legislation Schedule published by the Loan Market Association (or any successor Person), as in effect from time to time.

“Event of Default” means each of the conditions or events set forth in Section 8.1.

“Exchange Act” means the Securities Exchange Act of 1934, as amended from time to time, and any successor statute.

“Excluded Accounts” means (a) payroll, payroll taxes or employee benefit accounts, and (b) accounts containing funds of the types as deposits securing Liens described in clauses (f) and (g) of the definition of “Permitted Liens.”

“Excluded Taxes” means any of the following Taxes imposed on or with respect to a Recipient or required to be withheld or deducted from a payment to a Recipient, (i) Taxes imposed on or measured by the Recipient’s net income (however denominated) and franchise Taxes imposed on the Recipient, in both cases, (A) by the jurisdiction (or any political subdivision thereof) under the laws of which such recipient is organized or in which its principal office is located or, in the case of any Lender, in which its applicable lending office is located or (B) as the result of any other present or former connection between such Recipient and the jurisdiction imposing such Tax (other than connections arising from such Recipient having executed, delivered, become a party to, performed its obligations under, received payments under, received or perfected a security interest under, engaged in any other transaction pursuant to or enforced any Loan Document), (ii) in the case of a Lender, United States federal income withholding Taxes imposed on amounts payable to or for the account of such Lender pursuant to a law in effect on the date on which such Lender becomes a party hereto or such Lender changes its lending office, except that this clause (ii) shall not apply to the extent that, the assignment or change in lending office was requested by a Loan Party or, pursuant to Section 2.19 amounts with respect to such Taxes were payable either to such Lender’s assignor immediately before such Lender became a party hereto or to such Lender immediately before it changed its lending office, (iii) Taxes attributable to such Recipient’s failure to comply with Section 2.19(d) and (iv) Taxes imposed under FATCA.

“Existing Indebtedness” means (a) Indebtedness and other obligations outstanding under that certain Ritter Equipment Financing, (b) Indebtedness and other obligations outstanding under that certain Jeep Wrangler Financing.

“Extended Coverage Period” has the meaning specified in Section 7.2.

“Extraordinary Receipts” means any Cash received by Company or any of its Subsidiaries not in the ordinary course of business (and not consisting of proceeds described in Section 2.13(a) through(e) hereof), including, without limitation, (a) foreign, United States, state or local tax refunds, (b) pension plan reversions, (c) judgments, proceeds of settlements or other consideration of any kind in connection with any cause of action, (d) indemnity payments and (e) any purchase price adjustment received in connection with any purchase agreement.

“Fair Share” has the meaning specified in Section 7.2.

“Fair Share Contribution Amount” has the meaning specified in Section 7.2.

“FASB ASC” means the Accounting Standards Codification of the Financial Accounting Standards Board.

“FATCA” means Sections 1471 through 1474 of the Internal Revenue Code, in effect as of the date of this Agreement and any current regulations or official interpretations thereof (or any amended or successor version that is substantively comparable and not materially more onerous to comply with), any agreement entered into pursuant to Section 1471(b)(1) of the Code, and any law, regulation, rule, promulgation or official agreement implementing an official government agreement or intergovernmental agreement with respect to the foregoing.

“FCPA” has the meaning specified in Section 7.2.

“Federal Funds Effective Rate” means for any day, the rate per annum (expressed, as a decimal, rounded upwards, if necessary, to the next higher 1/100 of 1%) equal to the weighted average of the rates on overnight Federal funds transactions with members of the Federal Reserve System, as published by the Federal Reserve Bank of New York on the Business Day next succeeding such day; provided (a) if such day is not a Business Day, the Federal Funds Rate for such day shall be such rate on such transactions on the next preceding Business Day as so published on the next succeeding Business Day and (b) if no such rate is so published on such next succeeding Business Day, the Federal Funds Rate for such day shall be the average rate quoted to the Administrative Agent for the day for such transactions from two or more federal funds brokers of recognized standing selected by it in good faith.

“Fee Letter” means the letter agreement dated as of the Closing Date between Borrowers and Agents, as amended, amended and restated, supplemented or otherwise modified from time to time.

“Financial Officer Certification” means, with respect to the financial statements for which such certification is required, the certification of the chief financial officer of Company that such financial statements fairly present, in all material respects, the financial condition of Company and its Subsidiaries as at the dates indicated and the results of their operations and their cash flows for the periods indicated, subject to changes resulting from audit and normal year-end adjustments.

“Financial Plan” has the meaning specified in Section 5.1(i).

“First Priority” means, with respect to any Lien purported to be created in any Collateral pursuant to any Collateral Document, that such Lien is the only Lien to which such Collateral is subject, other than any Permitted Lien.

“Fiscal Quarter” means a fiscal quarter of any Fiscal Year.

“Fiscal Year” means the fiscal year of Company and its Subsidiaries ending on December 31^st of each calendar year.

“Fixed Rate” means, for any day, a rate per annum equal to twelve percent (12.0%).

“Fixed Rate Loan” means a Loan bearing interest at a rate determined by reference to the Fixed Rate.

“Flood Hazard Property” means any Real Estate Asset subject to a mortgage in favor of Agents, for the benefit of the Secured Parties, and located in an area designated by the Federal Emergency Management Agency as having special flood or mud slide hazards.

“Flow of Funds Agreement” means that certain Flow of Funds Agreement, dated as of the Closing Date, duly executed by each Loan Party, each Agent, each Lender and any other person party thereto, in form and substance reasonably satisfactory to the Agents, in connection with the disbursement of Loan proceeds in accordance with Section 2.5.

“Foreign Official” means any officer or employee of a non-U.S. government or any department, agency, or instrumentality thereof, or of a public international organization, or any person acting in an official capacity for or on behalf of any such government or department, agency, or instrumentality, or for or on behalf of any such public international organization.

“Funding Default” has the meaning specified in Section 2.21.

“Funding Notice” means a notice substantially in the form of Exhibit A-1.

“GAAP” means, subject to the limitations on the application thereof set forth in Section 1.2, United States generally accepted accounting principles in effect as of the date of determination thereof.

“Governmental Acts” means any act or omission, whether rightful or wrongful, of any Governmental Authority.

“Governmental Authority” means any federal, state, municipal, national or other government, governmental department, commission, board, bureau, court, agency or instrumentality or political subdivision thereof or any entity or officer exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to any government or any court, in each case whether associated with a state of the United States, the United States, or a foreign entity or government, including any central bank, stock exchange, regulatory body, arbitrator, public sector entity, supra-national entity (including the European Union and the European Central Bank) and any self-regulatory organization.

“Governmental Authorization” means any permit, license, authorization, plan, directive, consent order or consent decree of or from any Governmental Authority.

“Grantor” has the meaning specified in the Pledge and Security Agreement.

“Guaranteed Obligations” has the meaning specified in Section 7.1.

“Guarantor” means (a) each Subsidiary of Company (that is not a Borrower under this Agreement) and (b) each other Person which guarantees, pursuant to Article VII or otherwise, all or any part of the Obligations.

“Guaranty” means (a) the guaranty of each Guarantor set forth in Article VII and (b) each other guaranty, in form and substance satisfactory to Agents, made by any other Guarantor for the benefit of the Secured Parties guaranteeing all or part of the Obligations.

“Hazardous Materials” means, regardless of amount or quantity, (a) any element, compound or chemical that is defined, listed or otherwise classified as a contaminant, pollutant, toxic pollutant, toxic or hazardous substance, extremely hazardous substance or chemical, hazardous waste, special waste, or solid waste under Environmental Laws or that is likely to cause immediately, or at some future time, harm to or have an adverse effect on, the environment or risk to human health or safety, including, without limitation, any pollutant, contaminant, waste, hazardous waste, toxic substance or dangerous good which is defined or identified in any Environmental Law and which is present in the environment in such quantity or state that it contravenes any Environmental Law; (b) petroleum and its refined products; (c) polychlorinated biphenyls; (d) any substance exhibiting a hazardous waste characteristic, including, without limitation, corrosivity, ignitability, toxicity or reactivity as well as any radioactive or explosive materials; (e) any raw materials, building components (including, without limitation, asbestos-containing materials) and manufactured products containing hazardous substances listed or classified as such under Environmental Laws; and (f) any substance or materials that are otherwise regulated under Environmental Law.

“Hazardous Materials Activity” means any past, current, proposed or threatened activity, event or occurrence involving any Hazardous Materials, including the use, manufacture, possession, storage, holding, presence, existence, location, Release, threatened Release, discharge, placement, generation, transportation, processing, construction, treatment, abatement, removal, remediation, disposal, disposition or handling of any Hazardous Materials, and any corrective action or response action with respect to any of the foregoing.

“Held CNG Asset Sale Proceeds” shall have the meaning specified in Section 6.9(h).

“Highest Lawful Rate” means the maximum lawful interest rate, if any, that at any time or from time to time may be contracted for, charged, or received under the laws applicable to any Lender which are presently in effect or, to the extent allowed by law, under such applicable laws which may hereafter be in effect and which allow a higher maximum non-usurious interest rate than applicable laws now allow.

“Historical Financial Statements” means as of the Closing Date, (a) the audited financial statements of Company and its Subsidiaries, for the Fiscal Year ended December 31, 2018, consisting of balance sheets and the related consolidated statements of income, stockholders’ equity and cash flows for such Fiscal Year, and (b) for the interim periods from January 1, 2019 to the Closing Date, internally prepared, unaudited financial statements of Company and its Subsidiaries, consisting of a balance sheet and the related consolidated statements of income, stockholders’ equity and cash flows for each quarterly period, in the case of clauses (a) and (b), certified by the chief financial officer of Company that they fairly present, in all material respects, the financial condition of Company and its Subsidiaries, taken as a whole, as at the dates indicated and the results of their operations and their cash flows for the periods indicated, subject, if applicable, to changes resulting from audit and normal year-end adjustments.

“Increased Cost Lender” has the meaning specified in Section 2.22.

“Incremental Pro Forma Basis” shall mean, with respect to any financial ratio test hereunder, that compliance with such test at any time shall be determined (a) on a pro forma basis giving effect to any Incremental Term Loans incurred at or prior to such time, and (c) without netting the proceeds of Incremental Term Loans to be incurred at such time.

“Incremental Term Loan” shall mean the additional term loan of any Incremental Term Loan Lender.

“Incremental Term Loan Lender” shall mean a Lender that has advanced an outstanding Incremental Term Loan.

“Indebtedness” means, as applied to any Person, without duplication, (a) all indebtedness for borrowed money; (b) that portion of obligations with respect to Capital Leases that is properly classified as a liability on a balance sheet in conformity with GAAP; (c) all obligations of such Person evidenced by notes, bonds or similar instruments or upon which interest payments are customarily paid and all obligations in respect of notes payable and drafts accepted representing extensions of credit whether or not representing obligations for borrowed money; (d) any obligation owed for all or any part of the deferred purchase price of property or services, including any earn-outs, seller notes or other deferred payment obligations in connection with an acquisition to the extent such earn-outs, seller notes and deferred payment obligations are fixed and non-contingent (excluding any such obligations incurred under ERISA and excluding trade payables incurred in the ordinary course of business and repayable in accordance with customary trade terms); (e) all obligations created or arising under any conditional sale or other title retention agreement with respect to property acquired by such Person; (f) all indebtedness secured by any Lien on any property or asset owned or held by that Person regardless of whether the indebtedness secured thereby shall have been assumed by that Person or is non-recourse to the credit of that Person; (g) the face amount of any letter of credit or letter of guaranty issued, bankers’ acceptances facilities, surety bonds and similar credit transactions issued for the account of that Person or as to which that Person is otherwise liable for reimbursement of drawings; (h) the direct or indirect guaranty, endorsement (otherwise than for collection or deposit in the ordinary course of business), co-making, discounting with recourse or sale with recourse by such Person of the obligation of another; (i) any obligation of such Person the primary purpose or intent of which is to provide assurance to an obligee that the obligation of the obligor thereof will be paid or discharged, or any agreement relating thereto will be complied with, or the holders thereof will be protected (in whole or in part) against loss in respect thereof; (j) any liability of such Person for an obligation of another through any agreement (contingent or otherwise) (1) to purchase, repurchase or otherwise acquire such obligation or any security therefor, or to provide funds for the payment or discharge of such obligation (whether in the form of loans, advances, stock purchases, capital contributions or otherwise) or (2) to maintain the solvency or any balance sheet item, level of income or financial condition of another if, in the case of any agreement described under subclauses (1) or (2) of this clause (j), the primary purpose or intent thereof is as described in clause (i) above; (k) all obligations of such Person in respect of any exchange traded or over the counter derivative transaction, including, without limitation, any Interest Rate Agreement, whether entered into for hedging or speculative purposes; (l) all A/R Indebtedness; and (m) Disqualified Capital Stock. The Indebtedness of any Person shall include the Indebtedness of any partnership or joint venture in which such Person is a general partner or joint venturer, unless such Indebtedness is expressly non-recourse to such Person.

“Indemnified Liabilities” means, collectively, any and all liabilities (including Environmental Liabilities and Costs), obligations, losses, damages (including natural resource damages), penalties, claims (including Environmental Claims), costs (including the costs of any investigation, study, sampling, testing, abatement, cleanup, removal, remediation or other response action necessary to remove, remediate, clean up or abate any Hazardous Materials Activity), expenses and disbursements of any kind or nature whatsoever (including the reasonable fees and disbursements of counsel for Indemnitees in connection with any investigative, administrative or judicial proceeding commenced or threatened by any Person, whether or not any such Indemnitee shall be designated as a party or a potential party thereto, and any fees or expenses incurred by Indemnitees in enforcing this indemnity), whether direct, indirect or consequential and whether based on any federal, state or foreign laws, statutes, rules or regulations (including securities and commercial laws, statutes, rules or regulations and Environmental Laws), on common law or equitable cause or on contract or otherwise, that may be imposed on, incurred by, or asserted against any such Indemnitee, in any manner relating to or arising out of (a) this Agreement or the other Loan Documents or the transactions contemplated hereby or thereby (including the Lenders’ agreement to make Credit Extensions or the use or intended use of the proceeds thereof, or any enforcement of any of the Loan Documents (including any sale of, collection from, or other realization upon any of the Collateral or the enforcement of the Guaranty)); or (b) any Environmental Claim or any Hazardous Materials Activity relating to or arising from, directly or indirectly, any past or present activity, operation, land ownership, or practice of Company or any of its Subsidiaries.

“Indemnified Taxes” mean (a) Taxes, other than Excluded Taxes, imposed on or with respect to any payment made by or on account of any obligation of any Loan Party under any Loan Document and (b) to the extent not otherwise described in (a), Other Taxes.

“Indemnitee” has the meaning specified in Section 10.3(a).

“Indemnitee Agent Party” has the meaning specified in Section 9.8.

“Intercompany Subordination Agreement” means that certain Intercompany Subordination Agreement, dated as of the date hereof, made by the Loan Parties and their Subsidiaries in favor of Agents for the benefit of the Secured Parties in form and substance satisfactory to Agents.

“Intercreditor Agreement” means any Intercreditor Agreement (A/R) and/or any Intercreditor Agreement (Equipment) as the context may require.

“Intercreditor Agreement (A/R)” means any Intercreditor Agreement, by and among the A/R Collateral Agent and the Agents and acknowledged by the Loan Parties in form and substance reasonably satisfactory to the Required Lenders.

“Intercreditor Agreement (Equipment)” means any Intercreditor Agreement, by and among the Equipment Collateral Agent and the Agents and acknowledged by the Loan Parties in form and substance reasonably satisfactory to the Required Lenders.

“Insolvency Proceeding” means any proceeding commenced by or against any Person under any provision of any Debtor Relief Law.

“Interest Payment Date” means with respect to any Fixed Rate Loan, (i) the last Business Day of each calendar month, commencing on the first such date to occur after the Closing Date and continuing until the Obligations are paid in full in Cash, and (ii) the Term Loan Maturity Date.

“Interest Rate Agreement” means any interest rate swap agreement, interest rate cap agreement, interest rate collar agreement, interest rate hedging agreement or other similar agreement or arrangement, each of which is (a) for the purpose of hedging the interest rate exposure associated with Company’s and its Subsidiaries’ operations, and (b) not for speculative purposes.

“Internal Revenue Code” means the U.S. Internal Revenue Code of 1986, as amended to the date hereof and from time to time hereafter, and any successor statute.

“Investment” means (a) any direct or indirect purchase or other acquisition by Company or any of its Subsidiaries of, or of a beneficial interest in, any of the Securities or a material part of the assets of any other Person (other than a Guarantor) (or of any division or business line of such other Person); (b) any direct or indirect redemption, retirement, purchase, buyback, tender offer or other acquisition or similar transaction for value, by any Subsidiary of Company from any Person (other than Company or any Guarantor), of any Capital Stock of such Person; (c) any direct or indirect loan, advance or capital contributions by Company or any of its Subsidiaries to any other Person (other than to Company or any Guarantor), including all indebtedness and accounts receivable from that other Person that are not current assets or did not arise from sales to that other Person in the ordinary course of business; and (d) any direct or indirect guarantee of, provision of surety or credit enhancement in respect of or pledge of collateral to secure any obligations of any other Person. The amount of any Investment shall be the original cost of such Investment plus the cost of all additions thereto, without any adjustments for increases or decreases in value, or write ups, write downs or write offs with respect to such Investment.

“Investors” has the meaning specified in the definition of “Warrant Agreement”.

“Jeep Wrangler Debt Satisfaction” means the satisfaction of all obligations in respect of the Jeep Wrangler Financing.

“Jeep Wrangler Financing” means those certain finance leases entered into by EVO Equipment Leasing, LLC and Equipment Leasing Services, LLC dated May 13, 2019 and schedules thereto, for the lease of Jeep Wrangler vehicles.

“Joint Venture” means a joint venture, partnership or other similar arrangement, whether in corporate, partnership or other legal form; provided in no event shall any corporate Subsidiary of any Person be considered to be a Joint Venture to which such Person is a party.

“Lender” means each lender listed on the signature pages hereto as a Lender, and any other Person that becomes a party hereto pursuant to an Assignment Agreement other than any Person that ceases to be a party hereto pursuant to any Assignment Agreement.

“Lien” means (a) any lien, mortgage, pledge, assignment, hypothec, deed of trust, security interest, charge or encumbrance of any kind (including any agreement to give any of the foregoing, any conditional sale or other title retention agreement, and any lease in the nature thereof) and any option, trust or other preferential arrangement having the practical effect of any of the foregoing, and (b) in the case of Securities, any purchase option, call or similar right of a third party with respect to such Securities.

“Loan” means a Term Loan or an Incremental Term Loan.

“Loan Account” means an account maintained hereunder by Administrative Agent on its books of account and with respect to Borrowers, in which they will be charged with all Loans made to, and all other Obligations incurred by the Loan Parties.

“Loan Document” means any of this Agreement, the Notes, if any, the Collateral Documents, the Fee Letter, the Flow of Funds Agreement, any Guaranty, any Intercreditor Agreement, the Intercompany Subordination Agreement, and all other documents, instruments or agreements executed and delivered by a Loan Party for the benefit of any Agent or any Lender in connection herewith.

“Loan Party” means any Borrower or any Guarantor.

“Margin Stock” has the meaning specified in Regulation U of the Board of Governors of the Federal Reserve System as in effect from time to time.

“Material Adverse Effect” means a material adverse effect on and/or material adverse developments with respect to (a) the business operations, properties, assets, condition (financial or otherwise), liabilities or prospects of Company and its Subsidiaries taken as a whole; (b) the ability of any Loan Party to fully and timely perform its obligations under any Loan Document to which it is a party; (c) the legality, validity, binding effect, or enforceability against a Loan Party of a Loan Document to which it is a party; (d) the Collateral or the validity, perfection or priority of Agents Liens on the Collateral; or (e) the rights, remedies and benefits available to, or conferred upon, any Agent and any Lender or any other Secured Party under any Loan Document.

“Material Contract” means (a) any contract or other arrangement to which Company or any of its Subsidiaries is a party (other than the Loan Documents) for which breach, non-performance, cancellation or failure to renew would reasonably be expected to have a Material Adverse Effect, (b) any contract or agreement to which Company or any of its Subsidiaries is a party (including, without limitation, any agreement or instrument evidencing or governing Indebtedness) involving the aggregate consideration payable to or by Company or such Subsidiary is $5 million or more in any Fiscal Year (other than (i) purchase orders in the ordinary course of the business of Company or any of its Subsidiaries and (ii) contracts that by their terms may be terminated by Company or any of its Subsidiaries in the ordinary course of its business upon less than 60 days’ notice without penalty or premium), (c) those contracts and arrangements listed on Schedule 4.15, (d) all A/R Credit Agreements and associated A/R Loan Documents, (e) all Equipment Credit Agreements and associated Equipment Loan Documents and (d) all direct or indirect contracts to carry U.S. Mail or to act as a direct or indirect contract carrier of any other shipper or freight forwarder.

“Material Real Estate Asset” means (a) any fee owned Real Estate Asset having a fair market value in excess of $1,000,000 as of the date of the acquisition thereof, or (b) any Real Estate Asset that the Required Lenders have determined is material to the business, operations, properties, assets, condition (financial or otherwise) or prospects of Company or any Subsidiary thereof.

“Moody’s” means Moody’s Investor Services, Inc.

“Mortgage” means a mortgage, deed of trust or deed to secure debt, in form and substance satisfactory to Collateral Agent, made by a Loan Party in favor of Collateral Agent for the benefit of the Secured Parties, securing the Obligations and delivered to Collateral Agent.

“Multiemployer Plan” means any “multiemployer plan” as defined in Section 3(37) of ERISA.

“Narrative Report” means, with respect to Section 5.1(b) and Section 5.7(b) for which such narrative report is required, a hard copy presentation describing the financial performance of Company and its Subsidiaries including (a) management’s discussion and analysis of the financial condition and results of operations for the Company and its Subsidiaries and, separately, for the Subsidiaries that are party to an A/R Credit Agreement, in each case, for the applicable Fiscal Quarter or Fiscal Year and for the period from the beginning of the then current Fiscal Year to the end of such period to which such financial statements relate with comparison to and variances from corresponding periods of the previous Fiscal Year and Financial Plan, and (b) a business segment analysis that includes (i) financial performance through gross profit with comparisons to the corresponding period of the previous Fiscal Year and Financial Plan, (ii) trending analysis, and (iii) relevant key performance metrics and recurring monthly revenue roll-forward analysis.

“Net Proceeds” means (a) with respect to any Asset Sale or CNG Asset Sale, an amount equal to: (i) Cash payments received by Company or any of its Subsidiaries from such Asset Sale or CNG Asset Sale, minus (ii) any bona fide direct costs incurred in connection with such Asset Sale or CNG Asset Sale to the extent paid or payable to non-Affiliates, including (A) income or gains taxes payable by the seller as a result of any gain recognized in connection with such Asset Sale or CNG Asset Sale during the tax period in which the sale occurs, (B) payment of the outstanding principal amount of, premium or penalty, if any, and interest on any Indebtedness (other than the Loans, and in the case of a CNG Asset Sale, other than any obligations secured by a Lien the Net Proceeds of such CNG Asset Sale) that is secured by a Lien on the stock or assets in question and that is required to be repaid under the terms thereof as a result of such Asset Sale or CNG Asset Sale, and (C) a reasonable reserve for any indemnification payments (fixed or contingent) attributable to seller’s indemnities and representations and warranties to purchaser in respect of such Asset Sale or CNG Asset Sale undertaken by Company or any of its Subsidiaries in connection with such Asset Sale or CNG Asset Sale; provided that upon release of any such reserve, the amount released shall be considered Net Proceeds; and (b) with respect to any insurance, condemnation, taking or other casualty proceeds, an amount equal to: (i) any Cash payments or proceeds received by Company or any of its Subsidiaries (A) under any casualty, business interruption or “key man” insurance policies in respect of any covered loss thereunder, or (B) as a result of the condemnation or taking of any assets of Company or any of its Subsidiaries by any Person pursuant to the power of eminent domain, condemnation or otherwise, or pursuant to a sale of any such assets to a purchaser with such power under threat of such a taking, minus (ii) (A) any actual and reasonable costs incurred by Company or any of its Subsidiaries in connection with the adjustment or settlement of any claims of Company or such Subsidiary in respect thereof, and (B) any bona fide direct costs incurred in connection with any sale of such assets as referred to in clause (b)(i)(B) of this definition to the extent paid or payable to non-Affiliates, including income taxes payable as a result of any gain recognized in connection therewith.

“Non-Consenting Lender” has the meaning specified in Section 7.2.

“Non-US Lender” has the meaning specified in Section 2.19(d)(i).

“Note” means a promissory note evidencing the Term Loans which shall be in the form of Exhibit J, attached hereto.