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): February 1, 2019

 

EVO Transportation & Energy Services, Inc.

(Exact name of registrant as specified in its charter)

 

Delaware   000-54218   37-1615850
(State or other jurisdiction
of incorporation)
  (Commission
File Number)
  (I.R.S. Employer
Identification No.)

 

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)

 

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):

 

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

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.      ☐

 

 

 

 

 

 

Item 1.01 Entry into a Material Definitive Agreement.

 

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

 

Item 2.01 Completion of Acquisition or Disposition of Assets.

 

Closing of Ursa Major Acquisition

 

On February 1, 2019, EVO Transportation & Energy Services, Inc., a Delaware corporation (the “Company”), EVO Merger Sub, Inc. (“Merger Sub”), Ursa Major Corporation, a Wisconsin corporation (“Ursa”), John Lampsa, and Ursula Lampsa (the “Lampsas”) consummated the transactions contemplated by that certain Agreement and Plan of Merger dated December 15, 2018 (the “Merger Agreement”). Pursuant to the Merger Agreement, Merger Sub merged with and into Ursa, Ursa became a wholly-owned subsidiary of the Company, and the Company issued 800,000 shares of Company common stock to the Lampsas.

 

Prior to closing the transactions contemplated by the Merger Agreement, on February 1, 2019, the parties to the Merger Agreement entered into an amendment to the Merger Agreement, which amendment deleted the working capital provisions of the Merger Agreement and added a representation by the Lampsas regarding the amount of cash and cash equivalents held by Ursa prior to closing.

 

Closing of J.B. Lease Acquisition

 

On February 1, 2019, EVO Equipment Leasing, LLC, a wholly-owned subsidiary of the Company (“EVO Equipment”), J.B. Lease Corporation, a Wisconsin corporation (“JB Lease”), and the Lampsas consummated the transactions contemplated by that certain Stock Purchase Agreement dated December 15, 2018 (the “Stock Purchase Agreement”). Pursuant to the Stock Purchase Agreement, EVO Equipment acquired all of the capital stock of JB Lease (the “JB Lease Shares”) and JB Lease became a wholly-owned subsidiary of EVO Equipment.

 

Prior to closing the transactions contemplated by the Stock Purchase Agreement, on February 1, 2019, the parties to the Stock Purchase Agreement entered into an amendment to the Stock Purchase Agreement, which amendment: (i) added indemnification by EVO Equipment for any personal guarantees of the Lampsas not released at closing; (ii) added a waiver by the Lampsas of the closing condition that their personal guarantees be released at or prior to closing, and (iii) altered certain terms of the note to be issued to the Lampsas at closing.

 

As consideration for the JB Lease Shares, EVO Equipment paid the Lampsas $2,500,000, assumed approximately $12,000,000 in existing JB Lease indebtedness, and issued a promissory note in the principal amount of $6,430,000 to the Lampsas (the “JB Lease Note”). The JB Lease Note is interest-free until June 1, 2019 and is secured by 100% of the equity in Ursa and JB Lease. Beginning June 1, 2019, the JB Lease Note provides for monthly principal and interest payments of $50,000 and bears interest at a rate of 9% per annum, which interest is payable monthly in advance beginning June 1, 2019.

 

The Merger Agreement and Stock Purchase Agreement are described more fully in the Company’s Current Report on Form 8-K filed with the Securities and Exchange Commission on December 20, 2018. The descriptions set forth above of the amendment to the Merger Agreement, the amendment to the Stock Purchase Agreement, and the JB Lease Note are not complete and are subject to and qualified in their entirety by reference to the text of the amendments and the JB Lease Note, copies of which are filed herewith as Exhibit 2.1, 2.2, and 10.1 and the terms of which are incorporated by reference.

 

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John Lampsa Employment Agreement

 

On February 1, 2019, Ursa entered into an employment agreement (the “Lampsa Employment Agreement”) with John Lampsa pursuant to which John Lampsa will serve as the chief executive officer of Ursa. The Lampsa Employment Agreement provides for an initial term of one year, with automatic extensions (absent notice to the contrary) of one year upon the expiration of the initial term or any renewal term. Under the Lampsa Employment Agreement, John Lampsa will be entitled to base compensation of $275,000 per year, incentive compensation based on his 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 John Lampsa 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 Lampsa Employment Agreement also includes a customary confidentiality covenant and one-year post-termination nonsolicitation and non-interference covenants.

 

The description set forth above of the Lampsa Employment Agreement is not complete and is subject to and qualified in its entirety by reference to the text of the Lampsa Employment Agreement, a copy of which is filed herewith as Exhibit 10.2 and the terms of which are incorporated by reference.

 

Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.

 

The disclosures set forth in Item 2.01 above regarding the JB Lease Note and the indebtedness assumed at closing of the Stock Purchase Agreement are hereby incorporated by reference into this Item 2.03.

 

Item 3.02 Unregistered Sales of Equity Securities.

 

As consideration for Ursa and pursuant to subscription agreements with John and Ursula Lampsa, on February 1, 2019, the Company issued 800,000 shares of common stock, par value $0.0001 per share, to John and Ursula Lampsa. 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 description set forth above of the subscription agreements is not complete and is subject to and qualified in its entirety by reference to the text of the subscription agreements, copies of which are filed herewith as Exhibits 10.3 and 10.4 and the terms of which are incorporated by reference.

 

Item 9.01 Financial Statements and Exhibits.

 

  (a) Financial Statements of Businesses Acquired: The Company intends to file financial statements required by this Item 9.01(a) under the cover of an amendment to this Current Report on Form 8-K no later than seventy-one (71) calendar days after the date on which this Form 8-K was required to be filed.

 

  (b) Pro Forma Financial Information: The Company intends to file the pro forma financial information that is required by this Item 9.01(b) under the cover of an amendment to this Current Report on Form 8-K no later than seventy-one (71) calendar days after the date on which this Form 8-K was required to be filed.

 

 

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(d) Exhibits: The following exhibits are filed as part of this report:

 

Exhibit No.   Description
2.1   Amendment to Agreement and Plan of Merger dated February 1, 2019 between EVO Transportation & Energy Services, Inc., EVO Merger Sub, Inc., Ursa Major Corporation, John Lampsa, and Ursula Lampsa
2.2   Amendment to Stock Purchase Agreement dated February 1, 2019 between EVO Equipment Leasing, LLC, John Lampsa, and Ursula Lampsa
10.1   Promissory Note dated February 1, 2019 between EVO Equipment Leasing, LLC, John Lampsa, and Ursula Lampsa
10.2   Employment Agreement dated February 1, 2019 between EVO Transportation & Energy Services, Inc. and John Lampsa
10.3   Subscription Agreement dated February 1, 2019 between EVO Transportation & Energy Services, Inc. and Ursula Lampsa
10.4   Subscription Agreement dated February 1, 2019 between EVO Transportation & Energy Services, Inc. and John Lampsa

 

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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.

 

Dated: February 7, 2019 By: /s/ John P. Yeros
  Its: Chief Executive Officer

 

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Exhibit 2.1

 

AMENDMENT To

AGREEMENT And Plan of merger

 

THIS AMENDMENT TO AGREEMENT AND PLAN OF MERGER (this “ Amendment ”) is made effective as of February 1, 2019, by and between EVO Transportation & Energy Services, Inc., a Delaware corporation (“ Buyer ”), Ursa Major Corporation, a Wisconsin corporation (the “ Company ”), EVO Merger Sub, Inc., a Wisconsin corporation and a wholly-owned subsidiary of Buyer (“ Merger Sub ”), John Lampsa, an individual resident of Wisconsin, and Ursula Lampsa, an individual resident of Wisconsin (together with John Lampsa, the “ Equity Holders ” and each, an “ Equity Holder ”). Capitalized terms used herein and not otherwise defined have the meanings given to such terms in in the Original Agreement (as defined below).

 

RECITALS

 

A. The Parties entered into that certain Agreement and Plan of Merger dated December 15, 2018 (the “ Original Agreement ”).

 

B. The Parties desire to amend the Original Agreement as set forth herein.

 

AGREEMENTS

 

In consideration of the promises herein, the recitals set forth above, which are incorporated into this Amendment by this reference, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties to this Amendment agree as follows:

 

1. Amendment of Section 1.3 . Section 1.3 of the Original Agreement is hereby deleted in its entirety.

 

2. Amendment of Section 4.5 . Section 4.5 of the Original Agreement is hereby amended by adding the following sentence at the end of Section 4.5(a):

 

The Company had at least $4,300,000 in Cash in Company bank accounts as of January 31, 2019.

 

3. No Other Amendments . Except as amended hereby, the Original Agreement shall in all other respects remain in full force and effect.

 

4. Third Party Benefit . Nothing in this Amendment, expressed or implied, is intended to confer on any person other than the parties to this Amendment or their respective successors or assigns, any rights, remedies, obligations or liabilities under or by reason of this Amendment.

 

5. Governing Law and Forum . This Amendment 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 Amendment or any transaction contemplated hereby.

 

6. Counterparts . This Amendment 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.

 

***Signature Page Follows***

 

 

 

 

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

 

URSA MAJOR CORPORATION:   BUYER:
     
By: /s/ John Lampsa   EVO TRANSPORTATION & ENERGY SERVICES, INC.
John Lampsa, its Vice-President    
      By: /s/ Damon Cuzick
EQUITY HOLDERS:   Name:  Damon Cuzick
      Its:   President
/s/ John Lampsa    
John Lampsa   MERGER SUB:
     
/s/ Ursula Lampsa   EVO MERGER SUB, INC.
Ursula Lampsa    
    By:   /s/ Damon Cuzick
             Name:  Damon Cuzick
    Its:   Chief Financial Officer

 

 

 

 

Signature Page to Amendment to Agreement and Plan of Merger

 

 

Exhibit 2.2

 

AMENDMENT To

STOCK PURCHASE AGREEMENT

 

THIS AMENDMENT TO STOCK PURCHASE AGREEMENT (this “ Amendment ”) is made effective as of February 1, 2019, by and between EVO Equipment Leasing, LLC, a Delaware limited liability company (“ Buyer ”), John Lampsa, an individual resident of Wisconsin, and Ursula Lampsa, an individual resident of Wisconsin (together with John Lampsa, the “ Equity Holders ” and each, an “ Equity Holder ”). Capitalized terms used herein and not otherwise defined have the meanings given to such terms in in the Original Agreement (as defined below).

 

RECITALS

 

A. The Equity Holders and the Buyer entered into that certain Stock Purchase Agreement dated December 15, 2018 (the “ Original Agreement ”).

 

B. The Parties desire to amend the Original Agreement as set forth herein.

 

AGREEMENTS

 

In consideration of the promises herein, the recitals set forth above, which are incorporated into this Amendment by this reference, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties to this Amendment agree as follows:

 

1. Amendments of Section 1.2 .

 

Subsection (b) of Section 1.2 of the Original Agreement is hereby deleted in its entirety and replaced with the following:

 

(b) plus assumption or payoff by Buyer of an estimated amount of $12,000,000 of indebtedness, which assumed indebtedness will remain outstanding at Closing, provided that the Equity Holders are released from any and all personal guarantees guarantying any such indebtedness. In the event a personal guaranty of an Equity Holder cannot or will not be released by a lender, Buyer agrees that such indebtedness will be refinanced or paid off in a manner necessary to release any personal guarantees of Equity Holders. In the event that such indebtedness is not refinanced or paid off at or before Closing in a manner necessary to release any personal guarantees of Equity Holders, Buyer will indemnify the Equity Holders as provided in Section 6.2(a) .

 

Subsection (c) of Section 1.2 of the Original Agreement is hereby deleted in its entirety and replaced with the following:

 

(c) plus a promissory note in the aggregate amount of the JB Lease Loan (estimated at $6,430,000) issued by Buyer to the Equity Holders (the “ JB Lease Note ”). The JB Lease Note shall be interest-free for the period beginning on the date of Closing until the earlier of (i) payoff, or (ii) June 1, 2019 and shall be secured by Equity Interests. In the event the JB Lease Note is not paid in full prior to June 1, 2019, the JB Lease Note will then provide for monthly principal and interest payments of $50,000.00 by Buyer or the Company to Equity Holders with the first payment due on June 1, 2019, accruing interest of a rate of 9% per annum, with interest payable in advance. Any payment shall apply first to interest then to principal. The JB Lease Note will be secured by a collateral pledge agreement of Buyer’s equity interests in the Company and in Ursa Major Corporation and shall be due and payable in full by August 31, 2020. The JB Lease Note is further subject to Section 3.11, below.

 

 

 

 

2. Waiver of Section 2.3 (c). Equity Holders agree to waive the requirements set forth in Section 2.3(c) of the Original Agreement as a condition to Closing.

 

3. Amendment of Section 3.11 . Section 3.11 of the Original Agreement is hereby deleted in its entirety and replaced with the following:

 

3.11 JB Lease Note . If the Buyer raises Fifteen Million Dollars ($15,000,000) or more in one or a series of private or public debt or equity securities offerings before June 1, 2019, then the Buyer agrees to repay the JB Lease Note in full out of proceeds received by the Buyer from such offering or offerings by June 1, 2019.

 

4. Amendment of Section 6.2 . Section 6.2(a) of the Original Agreement is hereby deleted in its entirety and replaced with the following:

 

Indemnification by Buyer . Buyer agrees that it will indemnify, defend, and hold harmless the Equity Holders, from, against and in respect of any and all Losses imposed on, sustained, incurred or suffered by or asserted against the Equity Holders directly or indirectly, whether or not due to a third-party claim, arising out of, resulting from or in connection with: (i) any breach of, or inaccuracy in, any representation or warranty of Buyer in this Agreement; (ii) a breach of any covenant or agreement of Buyer contained in this Agreement; and (iii) any personal guaranty of an Equity Holder that remains in place after Closing.

 

5. No Other Amendments . Except as amended hereby, the Original Agreement shall in all other respects remain in full force and effect.

 

6. Third Party Benefit . Nothing in this Amendment, expressed or implied, is intended to confer on any person other than the parties to this Amendment or their respective successors or assigns, any rights, remedies, obligations or liabilities under or by reason of this Amendment.

 

7. Governing Law and Forum . This Amendment 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 Amendment or any transaction contemplated hereby.

 

8. Counterparts . This Amendment 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.

 

***Signature Page Follows***

 

 

 

 

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

 

EQUITY HOLDERS:   COMPANY:
     
/s/ John Lampsa   EVO EQUIPMENT LEASING, LLC
John Lampsa  
    By: /s/ Damon Cuzick
/s/ Ursula Lampsa   Name: Damon Cuzick
Ursula Lampsa   Its: Chief Financial Officer and Secretary

 

 

 

 

Signature Page to Amendment to Stock Purchase Agreement

 

 

Exhibit 10.1

 

THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR ANY STATE SECURITIES LAWS AND MAY NOT BE OFFERED, SOLD, PLEDGED, OR OTHERWISE TRANSFERRED OR DISPOSED OF UNLESS AND UNTIL THIS NOTE IS REGISTERED UNDER THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS OR AN EXEMPTION FROM SUCH REGISTRATION IS AVAILABLE.

 

PROMISSORY NOTE

 

February 1, 2019 $ 6,430,000.00

 

FOR VALUE RECEIVED, and subject to the terms and conditions set forth herein, EVO Equipment Leasing, LLC, a Delaware corporation, on behalf of itself and its successors and assigns (collectively, the “ Maker ”), hereby unconditionally promises to pay to the order of John Lampsa and Ursula Lampsa (collectively, the “ Noteholder ,” and together with the Maker, the “ Parties ”), the principal amount of SIX MILLION FOUR HUNDRED THIRTY THOUSAND AND 00/100 DOLLARS ($6,430,000) (the “ Loan ”), together with all accrued interest thereon, as provided in this Promissory Note (the “ Note ,” as the same may be amended, restated, supplemented or otherwise modified from time to time in accordance with its terms).

 

1. Definitions . Capitalized terms used herein and not defined elsewhere in this Note shall have the meanings set forth in this Section 1 .

 

Event of Default ” has the meaning set forth in Section 5 .

 

Governmental Authority ” means the government of any nation or any political subdivision thereof, whether at the national, state, territorial, provincial, municipal or any other level, and any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of, or pertaining to, government (including any supranational bodies such as the European Union or the European Central Bank).

 

Interest Rate ” means the rate equal to nine percent (9%) per annum.

 

Law ” as to any Person means any law (including common law), statute, ordinance, treaty, rule, regulation, policy or requirement of any Governmental Authority and authoritative interpretations thereon, whether now or hereafter in effect, in each case, applicable to or binding on such Person or any of its properties or to which such Person or any of its properties is subject.

 

Loan ” has the meaning set forth in the introductory paragraph.

 

Maker ” has the meaning set forth in the introductory paragraph.

 

Maturity Date ” means August 31, 2020.

 

 

 

 

Note ” has the meaning set forth in the introductory paragraph.

 

Noteholder ” has the meaning set forth in the introductory paragraph.

 

Order ” as to any Person, means any order, decree, judgment, writ, injunction, settlement agreement, requirement or determination of an arbitrator or a court or other Governmental Authority, in each case, applicable to or binding on such Person or any of its properties or to which such Person or any of its properties is subject.

 

Parties ” has the meaning set forth in the introductory paragraph.

 

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

 

2. Repayment of Principal and Interest .

 

2.1 Monthly Payments . No principal or interest payments will be due hereunder until June 1, 2019. Thereafter, principal and interest on this Note shall be paid in equal monthly installments of $50,000 each on the 1 st day of each calendar month commencing June 1, 2019 until the Loan is paid in full, whether at maturity, upon acceleration, by prepayment or otherwise. Any payment shall apply first to interest, which is payable in advance and not in arrears, then to principal.

 

2.2 Final Payment Date . The aggregate unpaid principal amount of the Loan, all accrued and unpaid interest and all other amounts payable under this Note shall be due and payable on the Maturity Date.

 

2.3 Optional Prepayment . The Maker may prepay the Loan in whole or in part at any time or from time to time without penalty or premium by paying the principal amount to be prepaid and all accrued interest thereon to the date of prepayment. No prepaid amount may be reborrowed. Any partial prepayment shall first be applied to interest then to principal.

 

2.4 Mandatory Prepayment . If the Maker raises Fifteen Million Dollars ($15,000,000) or more in one or a series of private or public debt or equity securities offerings before June 1, 2019, then the Maker will repay the aggregate unpaid principal amount of the Loan, all accrued and unpaid interest and all other amounts payable under this Note in full out of proceeds received by the Maker from such offering or offerings by June 1, 2019.

 

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3. Interest .

 

3.1 Interest Rate . The outstanding principal amount of the Loan made hereunder shall bear no interest from the date of this Note until June 1, 2019. Beginning June 1, 2019, the outstanding principal amount of the Loan made hereunder shall bear interest at the Interest Rate, calculated monthly in advance, until the Loan is paid in full, whether at maturity, upon acceleration, by prepayment or otherwise.

 

3.2 Computation of Interest . All computations of interest shall be made on the basis of a year of 365/366 days, as the case may be. Interest shall not accrue on the Loan on the day on which it is paid.

 

4. Payment Mechanics .

 

4.1 Manner of Payment . All payments of interest and principal shall be made in lawful money of the United States of America on the date on which such payment is due, without set-off or deduction of any kind, by cashier’s check delivered to the address as set forth in, or otherwise provided pursuant to, the notice provisions hereof or by wire transfer of immediately available funds to the Noteholder’s account at a bank specified by the Noteholder to the Maker from time to time.

 

4.2 Application of Payments . All payments made hereunder shall be applied first, to the payment of any fees or charges outstanding hereunder, second, to accrued interest and third, to the payment of the principal amount outstanding under the Note.

 

4.3 Business Day Convention . Whenever any payment to be made hereunder shall be due on a day that is not a Business Day, such payment shall be made on the next succeeding Business Day and such extension will be taken into account in calculating the amount of interest payable under this Note.

 

5. Events of Default . The occurrence of any of the following shall constitute an Event of Default hereunder:

 

5.1 Failure to Pay . The Maker fails to pay any amount of the Loan when amount is due and such default continues ten (10) calendar days after the date the Noteholder gives notice that the amount is past due.

 

5.2 Late Fee . If any installment payable under this Note (including the final installment due on the Maturity Date) is not received by Noteholder on or prior to ten (10) calendar days after the same is due (without regard to any applicable cure or notice period, and regardless of whether notice of the failure to pay has been given), Maker shall pay to Noteholder upon demand an amount equal to two percent (2%) of such unpaid sum to defray the expenses incurred by Maker in handling and processing such delinquent payment and to compensate Maker for the loss of the use of such delinquent payment.

 

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5.3 Bankruptcy .

 

(a) the Maker commences any case, proceeding or other action (i) under any existing or future law relating to bankruptcy, insolvency, reorganization, or other relief of debtors, seeking to have an order for relief entered with respect to it, or seeking to adjudicate it as bankrupt or insolvent, or other relief with respect to it or its debts, or (ii) seeking appointment of a receiver, trustee, custodian, conservator or other similar official for it or for all or any substantial part of its assets, or the Maker makes a general assignment for the benefit of its creditors;

 

(b) there is commenced against the Maker any case, proceeding or other action of a nature referred to in clause (a) above which (i) results in the entry of an order for relief or any such adjudication or appointment or (ii) remains undismissed, undischarged or unbonded for a period of sixty (60) days;

 

(c) there is commenced against the Maker any case, proceeding or other action seeking issuance of a warrant of attachment, execution or similar process against all or any substantial part of its assets which results in the entry of an order for any such relief which has not been vacated, discharged, or stayed or bonded pending appeal within sixty (60) days from the entry thereof;

 

(d) the Maker takes any action in furtherance of, or indicating its consent to, approval of, or acquiescence in, any of the acts set forth in clause (a), (b) or (c) above; or

 

(e) the Maker is generally not, or is unable to, or admits in writing its inability to, pay its debts as they become due.

 

5.4 Change of Control . Consummation of a sale, in one or a series of related transactions, of the Maker (whether by merger, reorganization, consolidation, sale of all or substantially all of the Maker’s assets or sale, directly or indirectly, of at least 50% of the Maker’s equity interests) to an unaffiliated third-party of the Maker.

 

6. Remedies . Upon the occurrence of an Event of Default and at any time thereafter during the continuance of such Event of Default, the Noteholder may, at its option by written notice to the Maker, (a) declare the entire principal amount of this Note, together with all accrued interest thereon and all other amounts payable hereunder, immediately due and payable and/or (b) exercise any or all of its rights, powers or remedies under applicable law; provided, however that, if an Event of Default described in Section 5.3 shall occur, the principal of and accrued interest on the Loan shall become immediately due and payable without any notice, declaration or other act on the part of the Noteholder.

 

7. Additional Note Terms .

 

7.1 Lien . This Note and the obligations evidenced hereunder are secured by the equity interests of Ursa Major Corporation and J.B. Lease Corporation held by EVO Transportation & Energy Services, Inc. and Maker, respectively, pursuant to a Stock Pledge Agreement of even date herewith.

 

7.2 Reserved .

 

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7.3 Securities Act . This Note has not been registered under the Securities Act of 1933, as amended, or under the securities law of any state. This Note may not be sold or transferred in the absence of registration or exemption therefrom under said Act and any applicable state laws.

 

8. Miscellaneous .

 

8.1 Notices .  

 

(a) All payments, notices, requests or other communications required or permitted to be delivered hereunder shall be delivered in writing to such address as a Party may from time to time specify in writing.

 

(b) Notices shall be deemed to have been given (i) if mailed by certified or registered mail, four (4) days after the date of mailing, (ii) if hand delivered, on the date of delivery, (iii) if sent by overnight courier service, on the day after the date of delivery to the courier, (iv) if sent by facsimile during the normal business hours of the recipient, on the day sent (and if sent after normal business hours, on the opening of the recipient’s business on the next day that is not a Saturday, Sunday or federal legal holiday) and (v) sent by email, on the sender’s receipt of an acknowledgment from the intended recipient (such as by the “return receipt requested” function, as available, return e-mail or other written acknowledgment).

 

8.2 Governing Law . This Note and any claim, controversy, dispute or cause of action (whether in contract or tort or otherwise) based upon, arising out of or relating to this Note and the transactions contemplated hereby shall be governed by the laws of the State of Delaware.

 

8.3 Submission to Jurisdiction .

 

(a) The Maker hereby irrevocably and unconditionally (i) agrees that any legal action, suit or proceeding arising out of or relating to this Note may be brought in the federal or state courts of the State of Delaware, and (ii) submits to the jurisdiction of any such court in any such action, suit or proceeding, and (iii) agrees that the venue for any such action, suit or proceeding shall be only in such courts. Final judgment against the Maker in any action, suit or proceeding shall be conclusive and may be enforced in any other jurisdiction by suit on the judgment.

 

(b) Nothing in this Section 8.3 shall affect the right of the Noteholder to (i) commence legal proceedings or otherwise sue the Maker in any other court having jurisdiction over the Maker or (ii) serve process upon the Maker in any manner authorized by the laws of any such jurisdiction.

 

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8.4 Waiver of Jury Trial . THE MAKER HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY RELATING TO THIS NOTE OR THE TRANSACTIONS CONTEMPLATED HEREBY WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY.

 

8.5 Counterparts; Integration; Effectiveness . This Note and any amendments, waivers, consents or supplements hereto may be executed in counterparts, each of which shall constitute an original, but all taken together shall constitute a single contract. This Note constitutes the entire contract between the Parties with respect to the subject matter hereof and supersede all previous agreements and understandings, oral or written, with respect thereto. Delivery of an executed counterpart of a signature page to this Note by facsimile or in electronic (i.e., “pdf” or “tif”) format shall be effective as delivery of a manually executed counterpart of this Note.

 

8.6 Waiver of Notice . The Maker hereby waives presentment, demand for payment, protest, notice of dishonor, notice of protest or nonpayment, notice of acceleration of maturity and diligence in connection with the enforcement of this Note or the taking of any action to collect sums owing hereunder.

 

8.7 Amendments and Waivers . No term of this Note may be waived, modified or amended except by an instrument in writing signed by both of the parties hereto. Any waiver of the terms hereof shall be effective only in the specific instance and for the specific purpose given.

 

8.8 Headings . The headings of the various Sections and subsections herein are for reference only and shall not define, modify, expand or limit any of the terms or provisions hereof.

 

8.9 No Waiver; Cumulative Remedies . No failure to exercise and no delay in exercising on the part of the Noteholder, of any right, remedy, power or privilege hereunder shall operate as a waiver thereof; nor shall any single or partial exercise of any right, remedy, power or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, remedy, power or privilege. The rights, remedies, powers and privileges herein provided are cumulative and not exclusive of any rights, remedies, powers and privileges provided by law.

 

8.10 Severability . If any term or provision of this Note is invalid, illegal or unenforceable in any jurisdiction, such invalidity, illegality or unenforceability shall not affect any other term or provision of this Note or invalidate or render unenforceable such term or provision in any other jurisdiction.

 

[ Signature page follows. ]

 

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IN WITNESS WHEREOF, the Maker has executed this Note as of date first written above.

 

  EVO EQUIPMENT LEASING, LLC
   
  By /s/ Damon Cuzick
  Name:  Damon Cuzick
  Title: President

 

Accepted and agreed to by:  
   
/s/ John Lampsa  
John Lampsa  
   
/s/ Ursula Lampsa  
Ursula Lampsa  

 

 

 

 

 

 

 

 

Signature Page to JB Lease Note

 

 

Exhibit 10.2

 

EMPLOYMENT AGREEMENT

 

This Employment Agreement (the “ Agreement ”) is entered into as of February 1, 2019, by and between Ursa Major Corporation (the “ Company ”) and John Lampsa (“ Employee ”). This Agreement will become effective upon the Closing of the transactions set forth in that separate Agreement and Plan of Merger, dated the same date as this Agreement, by and among EVO Transportation & Energy Services, Inc. (“ Parent ”), EVO Merger Sub, Inc., Employee, and Ursula Lampsa, as Closing is defined therein (the “ Effective Date ”). Absent such Closing, this Agreement shall be null and void and of no force or effect.

 

1. Duties and Scope of Employment .

 

(a) Positions and Duties . During the Employment Term (as defined below), Employee will be employed as the Chief Executive Officer of the Company. Employee’s authority, duties, and responsibilities will correspond to Employee’s position and will include any particular authority, duties, and responsibilities that the chief executive officer of Parent may assign to Employee from time to time. Employee will report to the chief executive officer of Parent.

 

(b) Obligations . During the Employment Term, Employee is required to faithfully and conscientiously perform his assigned duties and to diligently observe all of his obligations to the Company. Employee agrees to devote his full business time and efforts, energy and skill to his employment at the Company, and Employee agrees to apply all his skill and experience to the performance of his duties and advancing the Company’s interests. The foregoing shall not preclude Employee from (i) engaging in civic, charitable or religious activities (including serving as a director, trustee or officer) or, with the prior written consent of the Company, from serving on the boards of directors of other private companies or (ii) engaging in investments, including real estate investments and acting as the general partner or manager thereof, as long as such activities do not interfere or conflict with Employee’s responsibilities or duties hereunder. During the Employment Term, Employee may not perform services as an employee or consultant of any other competitive organization and Employee will not assist any other person or organization in competing with the Company or in preparing to engage in competition with the business or proposed business of the Company. Employee shall comply with and be bound by Company’s operating policies, procedures, and practices from time to time in effect during his employment that apply to all director-level employees of the Company. By signing this Agreement, Employee confirms to the Company that he has no contractual commitments or other legal obligations that would prohibit him from performing his duties for the Company.

 

(c) Employment Term . The term of this Agreement shall be one (1) year commencing on the Effective Date, unless terminated earlier pursuant to the terms herein (the “ Initial Term ”). Unless earlier terminated pursuant to the terms herein, the Initial Term shall be automatically renewed for consecutive additional one-year terms (each, a “ Renewal Term ”) upon the expiration of the Initial Term or any Renewal Term unless the Company or Employee delivers to the other at least 90 days prior to the expiration of the Initial Term or the then-current Renewal Term, as the case may be, a written notice specifying that the term of Employee’s employment will not be renewed at the end of the Initial Term or the then-current Renewal Term, as the case may be. Like the Initial Term, the then-current Renewal Term is subject to earlier termination pursuant to the terms herein. The Employee’s period of employment hereunder is referred herein as the “ Employment Term, ” whether the Initial Term, the then-current Renewal Term, or the shorter period through the date of an earlier termination thereof as provided elsewhere herein The notice of non-renewal given by the Company is referred to herein as the “ Company’s Non-Renewal .” The notice of non-renewal given by Employee is referred to herein as the “ Employee’s Non-Renewal .”

 

 

 

 

(d) Place of Performance . Employee will initially primarily report to the principal office of the Company, which is currently located in the Oak Creek, Wisconsin area. Employee understands and agrees that his duties will include reasonable travel, including but not limited to travel to offices of the Company, its Affiliates, and such other business travel as is reasonably necessary and appropriate to the performance of Employee’s duties hereunder, subject to reimbursement of expenses pursuant to Section 6 below.

 

2. At-Will Employment . The parties agree that Employee’s employment with the Company will be “at-will” employment and may be terminated at any time, upon written notice, either by the Company without Cause (in any such case, “ Company’s At-Will Termination ”) or by Employee without Good Reason (in any such case, “ Employee’s At-Will Termination ”). Employee understands and agrees that neither his job performance for, nor promotions, commendations, bonuses or the like from, the Company give rise to or in any way serve as the basis for modification, amendment, or extension, by implication or otherwise, of his employment with the Company. However, as described in this Agreement, Employee may be entitled to Severance Pay (defined below) and Severance Benefits (defined below) depending upon the circumstances of the termination of the Employment Term as set forth in Section 7(b) below.

 

3. Compensation .

 

(a) Initial Base Salary . During the Employment Term, the Company will pay Employee an annual base salary as compensation for his services (the “ Base Salary ”) at the initial rate of $275,000. The Base Salary will be paid periodically in accordance with the Company’s normal payroll practices. The Base Salary will be subject to review and adjustment by the Company.

 

(b) Annual Incentive Bonus . During the Employment Term, Employee will be eligible to earn an annual incentive bonus (an “ Annual Bonus ”) under the same or substantially same bonus arrangement, plan or program as in effect for other director-level employees of the Company from time to time and based upon the same general objective standards as are applied to the other director-level employees of Company, provided that Employee’s personal performance objectives shall be unique to his role. Consistent therewith, the Company will determine Employee’s target bonus opportunity and the criteria for earning such bonus, as well as Employee’s achievement of such criteria, and the amount of the Annual Bonus earned and payable to Employee for such year. Any Annual Bonus that is earned and becomes payable pursuant to this Section 3(b) will be paid no later than March 15 of the calendar year immediately following the calendar year to which the Annual Bonus relates. Employee’s Annual Bonus for calendar year 2018 shall be prorated on a weekly basis for his period of employment in such year. Employee must remain employed by the Company through December 31 of the applicable calendar year to be eligible to earn an Annual Bonus for such year; provided, however, that if the Employment Term ends prior to December 31 by reason of either termination by Employee for Good Reason or by the Company’s At-Will Termination, the Annual Bonus for such partial calendar year shall be prorated on a weekly basis for his period of employment in such year. The determinations of the Company with respect to the Annual Bonus will be final and binding unless there is direct evidence that the determination was in violation of the terms and provision of this Section 3(b) or the applicable program, plan or arrangement.

 

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(c) Equity . During the Employment Term, Employee will be eligible to receive awards of stock options pursuant to the same or substantially same stock option arrangement, plan or program as in effect for other director-level employees of the Company from time to time and based upon the same objective standards as are applied to the other director-level employees of Company. Consistent therewith, the Company will determine whether Employee will be granted any such equity awards and the terms of any such award in accordance with the terms of the applicable program, plan or arrangement that may be in effect from time to time.

 

4. Employee Benefits . During the Employment Term, Employee will be entitled to participate in the employee benefit plans and programs currently and hereafter maintained by the Company of general applicability to other director-level employees and to employees generally of the Company, subject to eligibility requirements and the applicable terms and conditions of the subject plan or program and the determination of any committee uniformly administering such plan or program. The Company reserves the right to cancel or change the benefit plans and programs it offers to its employees at any time.

 

5. Vacation . During the Employment Term, Employee will be eligible to accrue paid vacation of up to 20 days per calendar year, prorated for any partial calendar year of employment, in accordance with the Company’s standard vacation policy (including, without limitation, its policy on the maximum accrual, carry-over and payout), with the timing and duration of specific vacations mutually and reasonably agreed to by Employee and the Company.

 

6. Expenses . During the Employment Term, the Company will reimburse Employee for reasonable travel, lodging, meal, entertainment or other expenses incurred by Employee in the furtherance of or in connection with the performance of Employee’s duties hereunder, in accordance with the Company’s expense reimbursement policy as in effect from time to time.

 

7. Accrued Obligations; Severance; COBRA .

 

(a) Accrued Obligations . Upon the termination or expiration of the Employment Term for any reason, Company shall pay to Employee the following: (i) all unpaid Base Salary through the last day of the Employment Term; (ii) all unreimbursed expenses that otherwise are payable to Employee pursuant to Section 6 above, and (iii) all other accrued payments or benefits to which Employee is entitled and has earned under the terms of any applicable compensation, bonus, award or similar arrangement, plan or program (collectively, the “ Accrued Obligations ”). The Accrued Obligations shall be paid to Employee in a lump sum in cash within thirty (30) days following the termination or expiration of the Employment Term, unless otherwise required by law or the terms of the applicable arrangement, plan or program, in which case the same shall be paid as soon as permitted thereunder.

 

(b) Severance . If the Employment Term ends by reason of either termination by Employee for Good Reason or by the Company’s At-Will Termination, the Company shall pay to Employee the greater of (as applicable, “ Severance Pay ”) (i) an amount equal to the product of (A) the number of full or partial months, if any, in the period beginning on the date the Employment Term ended and ending on the date the Initial Term would have ended, if later than the date the Employment Term actually ended, multiplied by (B) Employee’s monthly Base Salary (as in effect immediately prior to the termination date) or (ii) an amount equal to one-half of Employee’s annual Base Salary (as in effect immediately prior to the termination date). The Severance Pay shall be paid by the Company to Employee in substantially equal monthly installments, without reduction or set off (other than as provided in Section 11(a) below), in accordance with the Company’s standard payroll procedures, commencing on the 60th day following the termination or expiration of the Employment Term, provided that the revocation period(s) set forth in the Release Agreement set forth in Section 8(a) below have expired without revocation. If the Employment Terms ends by reason of termination by the Company for Cause, by the Company’s Non-Renewal or Employee’s Non-Renewal of the Initial Term or any Renewal Term, by Employee’s At-Will Termination, or due to Employee’s death or disability, no Severance Pay will be owing or paid to Employee.

 

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(c) COBRA . If the Employment Term ends by reason of either termination by Employee for Good Reason or by the Company’s At-Will Termination, to the extent Employee and Employee’s spouse and/or dependent children properly (and timely) elect COBRA continuation coverage under the Company’s group health insurance plan, the Company shall pay, on Employee’s behalf, all of the premiums due for such coverage for a period beginning on the date the Employment Term so ended and ending on the earliest to occur of (as applicable, “ Severance Benefits ”) (i) the date on which Employee is no longer entitled to COBRA continuation coverage under the Company’s group health insurance plan, (ii) the last day of the month that includes or immediately precedes the first day that Employee is covered under another employer’s group health insurance plan or (iii) the last day of the month in which Employee receives his final Severance Pay payment; provided, however, that notwithstanding the foregoing or any other provision in this Agreement to the contrary, the Company may unilaterally amend this Section 7(c) or eliminate the benefit provided hereunder, upon written notice to Employee, but only if and to the extent necessary to avoid the imposition of excise taxes, penalties or similar charges on the Company, including, without limitation, under Code Section 4980D. If the Employment Terms ends by reason of termination by the Company for Cause, by the Company’s Non-Renewal or Employee’s Non-Renewal of the Initial Term or any Renewal Term, by Employee’s At-Will Termination, or due to Employee’s death or disability, no Severance Benefits will be owing to Employee.

 

8. Conditions to Receipt of Severance Pay and Severance Benefits .

 

(a) Release of Claims . The receipt of Severance Pay and Severance Benefits will be subject to Employee signing, delivering, not revoking and complying with a general release and waiver of claims in favor of the Company and its officers, directors and affiliates, which general release and waiver of claims shall be in a form prepared by the Company, in its reasonable discretion. By way of example and not limitation, the general release and waiver of claims will include any claims for wages, bonuses, employment benefits, or damages of any kind whatsoever, arising out of any contracts, express or implied, any covenant of good faith and fair dealing, express or implied, any theory of wrongful discharge, any legal restriction on the Company’s right to terminate employment, or any federal, state or other governmental statute or ordinance, including, without limitation, Title VII of the Civil Rights Act of 1964, the federal Age Discrimination in Employment Act, the American with Disabilities Act, the Family and Medical Leave Act, or any other legal limitation on the employment relationship.

 

(b) Compliance with Covenants . The receipt of Severance Pay and Severance Benefits will be subject to Employee’s compliance with Sections 9(a), 9(b), 9(c) and 9(d) of this Agreement. In the event Employee breaches any of Sections 9(a), 9(b), 9(c) or 9(d), (i) all remaining payments of Severance Pay and/or Severance Benefits to which Employee otherwise is entitled pursuant to Section 7(b) and Section 7(c) will immediately cease, and (ii) Employee will repay, or cause to be repaid, to the Company the full amount of any payments of Severance Pay and Severance Benefits previously paid by the Company to Employee or on behalf of Employee pursuant to Section 7(b) and/or Section 7(c) prior to the date of such breach.

 

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9. Restrictive Covenants .

 

(a) Non-Competition . In recognition of the consideration provided herein, and in connection with the protection of the Company’s trade secrets and customer contacts, Employee agrees that, during the Employment Term and ending on the later to occur of (i) the twelve (12) month anniversary following the termination or expiration of the Employment Term or (ii) the last day of the Severance Pay period as set forth in Section 7(b) (as applicable, the “ Restricted Period ”), Employee shall not either directly or indirectly, whether for consideration or otherwise: (i) engage in (except on behalf of the Company or any of its Affiliates), or compete with the Company in, a Competing Business anywhere in the Territory (any such entity, a “ Competing Entity ”); or (ii) form or assist others in forming, be employed by, perform services for, become an officer, director, member or partner of, or participant in, or consultant or independent contractor to, invest in or own any interest in (whether through equity or debt securities), assist (financially or otherwise) or lend Employee’s name, counsel or assistance to, any Competing Entity.

 

(b) Non-Solicitation . In recognition of the consideration provided herein, Employee agrees that, during the Restricted Period, Employee shall not either directly or indirectly, whether for consideration or otherwise: (i) solicit or accept business from any customer of the Company for the purpose of providing goods or services in a Competing Business or solicit or induce any customer of the Company to terminate, reduce or alter in a manner adverse to the Company, any existing business arrangement or agreement with the Company, (ii) be employed by any customer of the Company or (iii) solicit, hire, attempt to solicit or attempt to hire any person who is or was an employee of the Company or any of its Affiliates at any time during the twelve (12) months prior to such solicitation or hire. The restrictions set forth in this Section 9(b) shall not prohibit any form of general advertising or solicitation that is not directed at a specific person or entity or does not relate to a Competing Business.

 

(c) Non-Disclosure and Non-Use of Confidential Information . At all times during the Employment Term and for five (5) years thereafter (except with regard to trade secrets, for so long as such information remains a trade secret), Employee agrees that he will not, either directly or indirectly, (i) divulge, use, disclose (in any way or in any manner, including by posting on the Internet), reproduce, distribute, or reverse engineer or otherwise provide Confidential Information to any person, firm, corporation, reporter, author, producer or similar person or entity; (ii) take any action that would make available Confidential Information to the general public in any form; (iii) take any action that uses Confidential Information to solicit any customer of the Company or prospective customer (with whom the Company has had a substantive discussion on it becoming a customer of the Company within the immediately preceding twelve (12) months) in violation of Section 9(b); or (iv) take any action that uses Confidential Information for solicitation of, or marketing for, any service or product on Employee’s behalf or on behalf of any entity other than the Company or its Affiliates with which Employee was in fact associated, except (A) as required in connection with the performance of such Employee’s duties to the Company or any of its Affiliates, (B) as required to be included in any report, statement or testimony requested by any municipal, state or national regulatory body having jurisdiction over Employee, (C) as required in response to any summons or subpoena or in connection with any litigation, (D) to the extent necessary in order to comply with any law, order, regulation, ruling or governmental request applicable to Employee, (E) as required in connection with an audit by any taxing authority, or (F) as permitted by the express written consent of the Company.

 

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(i) In the event Employee is required to disclose Confidential Information pursuant to any of the foregoing exceptions, Employee shall promptly notify the Company of such pending disclosure and assist the Company (at the Company’s sole expense, which will be advanced to Employee whenever reasonable to do so) in seeking a protective order or in objecting to such request, summons or subpoena with regard to the Confidential Information. If the Company does not obtain such relief prior to the time that Employee is required to disclose such Confidential Information, Employee may disclose that portion of the Confidential Information (A) which counsel to Employee advises Employee that he is required to disclose or (B) which could subject Employee to be liable for contempt or suffer censure or penalty. In such cases, Employee shall promptly provide the Company with a copy of the Confidential Information so disclosed. This provision applies without limitation to unauthorized use of Confidential Information in any medium, including film, videotape, audiotape and writings of any kind (including books, articles, emails, texts, blogs and websites).

 

(ii) Employee is hereby notified, pursuant to the federal Defend Trade Secrets Act of 2016 (“ DTSA ”), that an individual shall not be held criminally or civilly liable under any federal or state trade secret law for the disclosure of a trade secret that is made (A) in confidence to a federal, state, or local government official, either directly or indirectly, or to an attorney, and (B) solely for the purpose of reporting or investigating a suspected violation of law; or (C) where the disclosure of a trade secret is made in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal. In addition, Employee is hereby notified under the DTSA that, if an individual files a lawsuit for retaliation by an employer for reporting a suspected violation of law, the individual may disclose a trade secret to his or her attorney and use the trade secret information in the court proceeding if the individual (Y) files any document containing the trade secret under seal; and (Z) does not disclose the trade secret, except pursuant to court order.

 

(d) Inventions and Patents; Third Party Information . The results and proceeds of Employee’s services to the Company (whether prior to or during the Employment Term), including, without limitation, any works of authorship related to the Company resulting from Employee’s services during Employee’s employment with the Company and any works in progress will be works-made-for-hire. The Company will be deemed the sole owner throughout the universe of such works-made-for-hire and any and all rights of whatsoever nature therein, whether or not now or hereafter known, existing, contemplated, recognized or developed, with the right to use the same in perpetuity in any manner the Company determines in its sole discretion without any further payment to Employee whatsoever. If, for any reason, any of such results and proceeds will not legally be a work-made-for-hire or there are any rights which do not accrue to the Company under the preceding sentence, then Employee hereby irrevocably assigns and agrees to assign to the Company any and all of Employee’s right, title and interest thereto, including, without limitation, any and all copyrights, patents, trade secrets, trademarks and/or other rights of whatsoever nature therein, whether or not now or hereafter known, existing, contemplated, recognized or developed. The Company will have the right to use the same in perpetuity throughout the universe in any manner the Company determines without any further payment to Employee whatsoever. Employee will, from time to time, as may be reasonably requested by the Company, and at the Company’s sole expense, sign such documents and assist the Company to establish or document the Company’s exclusive ownership of any and all rights in any such results and proceeds, including, without limitation, the execution of appropriate copyright or patent applications or assignments. To the extent Employee has any rights in any such results and proceeds that cannot be assigned in the manner described above, Employee unconditionally and irrevocably waives the right to enforce such unassignable rights. This Section 9(d) is subject to, and will not be deemed to limit, restrict or constitute any waiver by the Company of, any rights of ownership to which the Company may be entitled by operation of law by virtue of the Company being Employee’s employer. This Agreement does not apply to an invention or other works of authorship for which no equipment, supplies, facility or trade secret information of the Company was used and which was developed entirely on Employee’s own time, and (i) which does not relate (A) directly to the business of the Company or (B) to the Company’s actual or demonstrably anticipated research or development, or (ii) which does not result from any work performed by Employee for the Company hereunder.

 

(e) Enforcement; Remedies . Employee acknowledges that the covenants set forth in Sections 9(a), 9(b), 9(c) and 9(d) impose a reasonable restraint on Employee in light of the business and activities of the Company and its Affiliates. Employee acknowledges that a breach of Sections 9(a), 9(b), 9(c) or 9(d) by Employee will cause serious and potentially irreparable harm to the Company and its Affiliates. Employee therefore acknowledges that a breach of Sections 9(a), 9(b), 9(c) or 9(d) by Employee cannot be adequately compensated in an action for damages at law, and equitable relief would be necessary to protect the Company and its Affiliates from a violation of this Agreement and from the harm which this Agreement is intended to prevent. By reason thereof, Employee acknowledges that the Company is entitled, in addition to any other remedies it may have under this Agreement or otherwise, to preliminary and permanent injunctive and other equitable relief to prevent or curtail any breach or threatened breach of this Agreement. Employee acknowledges, however, that no specification in this Agreement of a specific legal or equitable remedy may be construed as a waiver of or prohibition against pursuing other legal or equitable remedies in the event of a breach of this Agreement by Employee. If Employee breaches this Section 9, Employee shall pay the reasonable attorneys’ fees and costs incurred by the Company in connection with enforcing its rights under this Agreement.

 

(f) Modification . In the event that any provision or term of this Sections 9(a), 9(b), 9(c) or 9(d), or any word, phrase, clause, sentence or other portion thereof (including, without limitation, the geographic and temporal restrictions and provisions contained in Sections 9(a) or 9(b)) is held to be unenforceable or invalid for any reason, such provision or portion thereof will be modified or deleted in such a manner as to be effective for the maximum period of time, the maximum geographical area, and otherwise to the maximum extent as to which it may be enforceable under applicable law. Such modified restriction(s) shall be enforced by a court having jurisdiction. In the event that such modification is not possible, because each of Employee’s obligations in Sections 9(a), 9(b), 9(c) and 9(d) is a separate and independent covenant, any unenforceable obligation shall be severed and all remaining obligations shall be enforceable.

 

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10. Definitions . For purposes of this Agreement, the following defined terms have the following meanings:

 

(a) “ Affiliate ” means, with respect to the Company, any corporation, limited liability company, partnership, business trust or organization, or other entity directly or indirectly controlling, controlled by or under common control with the Company, where control means holding more than 50% of both the voting interests of the entity and the authority to direct the management and policies of the entity.

 

(b) “ Cause ” means any of the following: (i) Employee’s conviction of, or plea of guilty or nolo contendere to, a misdemeanor involving dishonesty, wrongful taking of property, immoral conduct, bribery or extortion or any felony; (ii) willful material misconduct by Employee in connection with the business of the Company and its Affiliates; (iii) Employee’s continued and willful failure to perform substantially his responsibilities to the Company under this Agreement; (iv) Employee’s material breach of this Agreement; (v) Employee’s fraud, theft or material dishonesty against the Company, its Affiliates or its customers; (vi) Employee’s willful and material breach of the Company’s written code of conduct and business ethics or other material written policy, procedure or guideline in effect from time to time and applicable to the Company’s employees generally relating to personal conduct; or (vii) Employee’s willful attempt to obstruct or willful failure to cooperate when with any investigation authorized by the Company or any governmental or self-regulatory entity. With respect to Sections 10(a)(ii), 10(a)(iii), 10(a)(iv), 10(a)(vi) and 10(a)(vii) and notwithstanding any other provision of this Agreement to the contrary, Company shall not terminate the Employment Term for Cause unless (x) the Company notifies Employee in writing of such determination within ninety (90) days following the Company’s first knowledge of the existence thereof (which notice specifically identifies the reasons and details therefore), (y) Employee fails to remedy the same within thirty (30) days after the date on which he received such notice (the “ Remedial Period ”), and (z) the Company terminates the Employment Term for Cause within thirty (30) days after the end of the Remedial Period.

 

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

 

(d) “ Competing Business ” means (i) a business that is engaged in the acquisition or operation of compressed natural gas fueling stations, (ii) a business that is engaged in providing freight trucking services, or (iii) any other business in which the Company or any of its Affiliates is then-currently engaged or was engaged at any time in the twelve (12) month period prior to Employee’s last day of employment with the Company.

 

(e) “ Confidential Information ” means confidential or proprietary information and/or techniques of the Company or its Affiliates entrusted to, developed by, or made available by the Company or any of its Affiliates to Employee during the Employment Term, whether in writing, in computer form, reduced to a tangible form in any medium, or conveyed orally, that is not generally known by others in the form in which it is or was used by the Company or its Affiliates. Examples of Confidential Information include, without limitation: (i) sales, sales volume, sales methods, sales proposals, business plans or statements of work; (ii) customers of the Company, prospective customer (with whom the Company has had a substantive discussion on it becoming a customer of the Company within the immediately preceding twelve (12) months), and customer records, including contact and preference information; (iii) costs of goods or services charged by vendors and suppliers to the Company; (iii) prices charged to specific customers and non-public general price lists and similar pricing information; (iv) terms of contracts with customer; (vii) non-public information and materials describing or relating to the financial condition and affairs of the Company or its Affiliates, including but not limited to, financial statements, budgets, projections financial and/or investment performance information, research reports, personnel matters, products, services, operating procedures, organizational responsibilities and marketing matters, policies or procedures; (viii) non-public information and materials describing existing or new processes, products and services of the Company or its Affiliates, including marketing materials, analytical data and techniques, and product, service or marketing concepts under development, and the status of such development; (ix) the business or strategic plans of the Company or its Affiliates; (x) the information technology systems, network designs, computer program code, and application practices of the Company or its Affiliates; (xi) acquisition candidates of the Company or its Affiliates or any studies or assessments relating thereto; and (xii) trademarks, service marks, trade secrets, trade names and logos. In addition and notwithstanding the foregoing, Confidential Information does not include either (y) information that, other than as a result of a breach by Employee of this Agreement, is or becomes generally known to and available for use by the public and (z) information that is, at any time, either on the Company’s website or is in brochures, advertising and other materials furnished or provided to customers of the Company and prospective customer (with whom the Company has had a substantive discussion on it becoming a customer of the Company within the immediately preceding twelve (12) months).

 

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(f) “ Disability ” means Employee’s inability to perform one or more essential functions of his position, after taking into account reasonable accommodations, by reason of any medically diagnosed physical or mental impairment and such inability continues for a period of at least 120 consecutive calendar days. A determination of such Disability will be made by a physician reasonably acceptable to the Company and Employee (or, if applicable, his spouse or legal representative).

 

(g) “ Good Reason ” means the occurrence of any of the following events, without the written consent of Employee:

 

(i) any reduction in Employee’s Base Salary (as it may have been increased after the Effective Date), except by no more than ten percent (10%) as part of an across the board salary reduction uniformly applied to all director-level employees of the Company;

 

(ii) any material reduction in Employee’s authority, duties or responsibilities or the assignment to Employee of any duties that are inconsistent with his position or;

 

(iii) any other action or inaction that constitutes a material breach by the Company of this Agreement or any other agreement under which Employee provides services to the Company or any of its Affiliates.

 

Notwithstanding any other provision of this Agreement to the contrary, Employee shall not terminate the Employment Term for Good Reason unless (A) Employee notifies the Company in writing of the condition that Employee believes constitutes Good Reason within ninety (90) days following the Employee’s first knowledge of the existence thereof (which notice specifically identifies such condition and the details regarding its existence), (ii) the Company fails to remedy such condition within thirty (30) days after the date on which it receives such notice (the “ Remedial Period ”), and (iii) Employee terminates the Employment Term within thirty (30) days after the end of the Remedial Period for Good Reason.

 

(h) “ Section 409A ” means Section 409A of the Code and the Treasury Regulations issued thereunder.

 

- 8 -

 

 

(i) “ Territory ” means any State in the United States in which the Company then-currently conduct their business or have conducted their business at any time in the prior twelve (12) months.

 

11. Tax Matters

 

(a) Withholding . All payments made pursuant to this Agreement will be subject to withholding of taxes as required by applicable law.

 

(b) Responsibility . Notwithstanding anything to the contrary herein, the Company makes no representations or warranties to Employee with respect to any tax, economic or legal consequences of this Agreement or any payments or other benefits provided hereunder, including without limitation under Section 409A, and no provision of the Agreement shall be interpreted or construed to transfer any liability for failure to comply with Section 409A or any other legal requirement from Employee or any other individual to the Company or any of its Affiliates, except as provided below. Employee, by executing this Agreement, shall be deemed to have waived any claim against the Company and its Affiliates with respect to any such tax, economic or legal consequences; provided, however, if any amount payable pursuant to this Agreement is included in Employee’s gross income under Section 409A(a)(1)(A) of the Code, then (i) Employee shall be responsible for the payment of the income taxes imposed on such payment and the amount of interest under Section 409A(a)(1)(B)(i)(I) of the Code and (ii) the Company shall be responsible for the payment of the amount due under Section 409A(a)(1)(B)(i)(II) of the Code within 30 days after such time as a final determination is made that such amount is due and payable by Employee (whether by an agreed assessment, a decision upon administrative appeal, or a decision by a court having jurisdiction). The parties intend that the payment under the preceding clause (ii) will comply with Treasury Regulation Sections 1.409A-3(i)(1)(i), 1.409A-3(i)(1)(v) and 1.409A-3(i)(1)(v).

 

(c) Section 409A . The parties intend that this Agreement and the payments and other benefits provided hereunder be exempt from the requirements of Section 409A to the maximum extent possible, whether pursuant to the short-term deferral exception described in Treasury Regulations Section 1.409A-1(b)(4), the involuntary separation pay plan exception described in Treasury Regulations Section 1.409A-1(b)(9)(iii), or otherwise. To the extent Section 409A is applicable to this Agreement and any such payments and benefits, the parties intend that this Agreement and such payments and benefits comply with the deferral, payout and other limitations and restrictions imposed under Section 409A. Notwithstanding any other provision of this Agreement to the contrary, this Agreement shall be interpreted, operated and administered in a manner consistent with such intentions. Without limiting the generality of the foregoing, and notwithstanding any other provision of this Agreement to the contrary:

 

(i) if at the time Employee’s employment hereunder terminates, Employee is a “specified employee,” as defined in Treasury Regulations Section 1.409A-1(i) and determined using the identification methodology selected by the Company from time to time, or if none, the default methodology, then to the extent necessary to avoid subjecting Employee to the imposition of any additional tax under Section 409A, any and all amounts payable under this Agreement on account of such termination of employment that would (but for this provision) be payable within six (6) months following the date of termination, shall instead be paid in a lump sum on the first day of the seventh month following the date on which Employee’s employment terminates or, if earlier, upon Employee’s death;

 

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(ii) a termination of employment shall not be deemed to have occurred for purposes of any provision of this Agreement providing for the payment of amounts or benefits upon or following a termination of employment unless such termination is also a “separation from service,” as defined in Treasury Regulations Section 1.409A-1(h) after giving effect to the presumptions contained therein, and, for purposes of any such provision of this Agreement, references to “terminate,” “termination,” “termination of employment” and like terms shall mean separation from service;

 

(iii) each payment made under this Agreement shall be treated as a separate payment and the right to a series of installment payments under this Agreement shall be treated as a right to a series of separate payments; and

 

(iv) with regard to any provision in this Agreement that provides for reimbursement of expenses or in-kind benefits, except for any expense, reimbursement or in-kind benefit provided pursuant to this Agreement that does not constitute a “deferral of compensation,” within the meaning of Treasury Regulations Section 1.409A-1(b), (A) the right to reimbursement or in-kind benefits shall not be subject to liquidation or exchange for another benefit, (B) the amount of expenses eligible for reimbursement, or in-kind benefits provided, during any taxable year shall not affect the expenses eligible for reimbursement, or in-kind benefits to be provided, in any other taxable year, and (C) such payments shall be made no later than two and a half months after the end of the calendar year in which the expenses were incurred.

 

(d) Limitation on Payments Under Certain Circumstances .

 

(i) Notwithstanding any other provision of this Agreement to the contrary, in the event that Employee becomes entitled to receive or receives any payments, options, awards or benefits (including, without limitation, the monetary value of any non-cash benefits and the accelerated vesting of stock awards) under any agreement, arrangement, plan or program with the Company or any person affiliated with the Company (collectively, the “ Payments ”), that may separately or in the aggregate constitute “parachute payments” within the meaning of Code Section 280G and the Treasury regulations promulgated thereunder (“ Section 280G ”) and it is determined that, but for this Section 12(d)(i), any of the Payments will be subject to any excise tax pursuant to Code Section 4999 or any similar or successor provision (the “ Excise Tax ”), the Company shall pay to Employee either (i) the full amount of the Payments or (ii) an amount equal to the Payments reduced by the minimum amount necessary to prevent any portion of the Payments from being an “excess parachute payment” (within the meaning of Section 280G) (the “ Capped Payments ”), whichever of the foregoing amounts results in the receipt by Employee, on an after-tax basis (with consideration of all taxes incurred in connection with the Payments, including the Excise Tax), of the greatest amount of Payments notwithstanding that all or some portion of the Payments may be subject to the Excise Tax. For purposes of determining whether Employee would receive a greater after-tax benefit from the Capped Payments than from receipt of the full amount of the Payments and for purposes of Section 11(d)(iii) (if applicable), Employee shall be deemed to pay federal, state and local taxes at the highest marginal rate of taxation for the applicable calendar year.

 

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(ii) All computations and determinations called for by Sections 11(d)(i) and 11(d)(iii) shall be made and reported in writing to the Company and Employee by a third-party service provider selected by the Company and Employee (the “ Tax Advisor ”), and all such computations and determinations shall be conclusive and binding on the Company and Employee. For purposes of such calculations and determinations, the Tax Advisor may rely on reasonable, good faith interpretations concerning the application of Code Sections 280G and 4999. The Company and Employee shall furnish to the Tax Advisor such information and documents as the Tax Advisor may reasonably request in order to make their required calculations and determinations. The Company shall bear all fees and expenses charged by the Tax Advisor in connection with its services.

 

(iii) In the event that Section 11(d)(i) applies and a reduction is required to be applied to the Payments thereunder, the Payments shall be reduced by the Company in a manner and order of priority that provides Employee with the largest net after-tax value; provided that payments of equal after-tax present value shall be reduced in the reverse order of payment. Notwithstanding anything to the contrary herein, any such reduction shall be structured in a manner intended to comply with Section 409A.

 

12. Assignment . This Agreement and Employee’s rights under this Agreement are personal to Employee and shall not be assignable by Employee. The Company may, by written notice to Employee, assign this Agreement to any affiliated or successor to all or substantially all of the business and assets the Company and then only so long as such affiliate or successor assumes and agrees, in such form and substance as is reasonably satisfactory to Employee, to perform all of the Company’s duties, responsibilities, obligations and liabilities hereunder, including without limitation upon the termination of the Employment Term; provided, however, the termination of Employee’s employment hereunder by such affiliate or successor and the immediate hiring and continuation of Employee’s employment by such affiliate or successor upon the identical terms and provisions of this Agreement shall not be deemed to constitute a termination of the Employment Term. All of the terms and provisions of this Agreement shall be binding upon and inure to the benefit of and be enforceable by the parties hereto and their respective successors and permitted assigns.

 

13. Notices . All notices, requests, demands and other communications called for hereunder will be in writing and will be deemed given (a) on the date of delivery if delivered personally, (b) one (1) day after being sent by a reputable commercial overnight service, or (c) four (4) days after being mailed by registered or certified mail, return receipt requested, prepaid and addressed to the parties or their successors at the following addresses, or at such other addresses as the parties may later designate in writing:

 

If to the Company:

 

EVO Transportation & Energy Services, Inc.

8285 West Lake Pleasant Parkway

Peoria, AZ 85382

Attention: John P. Yeros

 

If to Employee:

 

John Lampsa

245 Legend Heights

Wales, WI 53183

 

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14. Severability . In the event that any provision hereof becomes or is declared by a court of competent jurisdiction to be illegal, unenforceable or void, this Agreement will continue in full force and effect without said provision.

 

15. Integration . This Agreement represents the entire agreement and understanding between the parties as to the subject matter herein and supersedes all prior or contemporaneous agreements whether written or oral. No waiver, alteration or modification of any of the provisions of this Agreement will be binding unless in writing that specifically refers to this Agreement and is signed by Employee and a duly authorized representative of the Company.

 

16. Waiver of Breach . The waiver of a breach of any term or provision of this Agreement must be in writing and will not operate as or be construed to be a waiver of any other previous or subsequent breach of this Agreement.

 

17. Headings . All captions and section headings used in this Agreement are for convenient reference only and do not form a part of this Agreement.

 

18. Governing Law . This Agreement will be construed and interpreted in accordance with, and any dispute or controversy arising from any breach or asserted breach of this Agreement will be governed by, the laws of the State of Wisconsin without regard to any choice of law rules. Any action brought to enforce or interpret this Agreement must be brought in the state or federal courts for the State of Wisconsin, and the parties hereby consent to the jurisdiction and venue of such courts in the event of any dispute. Each of the parties knowingly and voluntarily waives all right to trial by jury in any action or proceeding arising out of or relating to this Agreement, Employee’s employment by the Company, or for recognition or enforcement of any judgment.

 

19. Acknowledgment . Employee acknowledges that he has had the opportunity to discuss this Agreement with and obtain advice from his private attorney, has had sufficient time to, and has carefully read and fully understands all the provisions of this Agreement, and is knowingly and voluntarily entering into this Agreement.

 

20. Counterparts . This Agreement may be executed in counterparts, and may delivered personally or by facsimile or electronic transmission, and each counterpart will have the same force and effect as an original and will constitute an effective, binding agreement on the part of each of the undersigned parties.

 

 

 

 

{Signature Page Follows}

 

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IN WITNESS WHEREOF, each of the parties has executed this Employment Agreement, in the case of the Company by its duly authorized officer, as of the Effective Date in the preamble hereof.

 

COMPANY:    
     
URSA MAJOR CORPORATION    
     
By: /s/ Damon Cuzick   Date: January 31, 2019
Name:  Damon Cuzick    
Title: President    

 

EMPLOYEE:    
     
/s/ John Lampsa   Date: February 1, 2019
John Lampsa    

 

 

Exhibit 10.3

 

THE SECURITIES OFFERED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR THE SECURITIES LAWS OF ANY STATE AND ARE BEING OFFERED AND SOLD IN RELIANCE UPON EXEMPTIONS FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. THE SECURITIES PURCHASED HEREUNDER MAY NOT BE TRANSFERRED OR RESOLD EXCEPT AS PERMITTED UNDER THE SECURITIES ACT AND OTHER APPLICABLE LAWS PURSUANT TO REGISTRATION OR EXEMPTION FROM REQUIREMENTS THEREUNDER.

 

EVO Transportation & Energy Services, Inc.

 

SUBSCRIPTION AGREEMENT

 

This Subscription Agreement (this “ Agreement ”) is made as of February 1, 2019 between EVO Transportation & Energy Services, Inc., a Delaware corporation (the “ Company ”) and Ursula Lampsa (the “ Subscriber ”).

 

On the date hereof, the Subscriber and the Company consummated the transactions contemplated by that certain Agreement and Plan of Merger, dated December 15, 2018 (the “ Merger Agreement ”), pursuant to which the outstanding Equity Interests (as defined in the Merger Agreement) issued to Subscriber converted into the right to receive a portion of the Merger Consideration (as defined in the Merger Agreement) on the terms set forth in the Merger Agreement.

 

Pursuant to the terms of the Merger Agreement, Subscriber is willing to purchase, and the Company is willing to issue and sell to the Subscriber, the number of shares of common stock of the Company (the “ Securities ”) set forth on Exhibit A hereto, all on the terms and subject to the conditions set forth herein and in the Merger Agreement.

 

1 . Subscription and Purchase Price.

 

(a) Subscription . On the terms and subject to the conditions set forth herein and in the Merger Agreement, the undersigned hereby subscribes for and agrees to purchase the Securities set forth on Exhibit A hereto.

 

(b) The Subscriber understands and agrees that, subject to applicable laws, by executing this Agreement, he, she or it is entering into a binding agreement.

 

2. Subscriber’s Representations, Warranties and Agreements

 

The undersigned hereby acknowledges, agrees with and represents and warrants to the Company and its affiliates, as follows:

 

(a) The undersigned has full power and authority to enter into this Agreement, the execution and delivery of which has been duly authorized, if applicable, and this Agreement constitutes a valid and legally binding obligation of the undersigned.

 

 

 

 

(b) The undersigned acknowledges his, her or its understanding that the offering and sale of the Securities is intended to be exempt from registration under the Securities Act of 1933, as amended (the “ Securities Act ”), by virtue of Section 4(a)(2) of the Securities Act and the provisions of Regulation D promulgated thereunder (“ Regulation D ”). In furtherance thereof, the undersigned represents and warrants to the Company and its affiliates as follows:

 

(i) The undersigned is acquiring the Securities solely for the undersigned’s own beneficial account, for investment purposes, and not with view to, or resale in connection with, any distribution of the Securities;

 

(ii) The undersigned has the financial ability to bear the economic risk of his, her or its investment, has adequate means for providing for their current needs and contingencies, and has no need for liquidity with respect to the investment in the Company;

 

(iii) The undersigned and the undersigned’s attorney, accountant, purchaser representative and/or tax advisor, if any (collectively, “ Advisors ”), have received all documents requested by the undersigned or Advisors, if any, and have carefully reviewed them and understand the information contained therein, prior to the execution of this Agreement; and

 

(iv) The undersigned (together with his, her or its Advisors, if any) has such knowledge and experience in financial and business matters as to be capable of evaluating the merits and risks of the prospective investment in the Securities. If other than an individual, the undersigned also represents it has not been organized solely for the purpose of acquiring the Securities.

 

(c) The information in the Investor Questionnaire (attached as Appendix A ) completed and executed by the undersigned (the “ Investor Questionnaire ”) is true and accurate in all respects, and the undersigned is an “accredited investor,” as that term is defined in Rule 501(a) of Regulation D.

 

(d) The undersigned has relied on the advice of, or has consulted with, only his, her or its Advisors. Each Advisor, if any, is capable of evaluating the merits and risks of an investment in the Securities, and each Advisor, if any, has disclosed to the undersigned in writing (a copy of which is annexed to this Agreement) the specific details of any and all past, present or future relationships, actual or contemplated, between the Advisor and the Company or any affiliate thereof.

 

(e) The undersigned represents, warrants and agrees that he, she or it will not sell or otherwise transfer the Securities without registration under the Securities Act or an exemption therefrom, and fully understands and agrees that the undersigned must bear the economic risk of his, her or its purchase because, among other reasons, the Securities have not been registered under the Securities Act or under the securities laws of any state and, therefore, cannot be resold, pledged, assigned or otherwise disposed of unless they are subsequently registered under the Securities Act and under the applicable securities laws of such states, or an exemption from such registration is available. In particular, the undersigned is aware that the Securities are “restricted securities,” as such term is defined in Rule 144 promulgated under the Securities Act (“ Rule 144 ”), and they may not be sold pursuant to Rule 144 unless all of the conditions of Rule 144 are met. The undersigned also understands that, except as described in Section 5 of this Agreement, the Company is under no obligation to register the Securities on his, her or its behalf or to assist them in complying with any exemption from registration under the Securities Act or applicable state securities laws. The undersigned understands that any sales or transfers of the Securities are further restricted by state securities laws.

 

(f) No representations or warranties have been made to the undersigned by the Company, other than any representations of the Company contained herein, and in subscribing for the Securities the undersigned is not relying upon any representations other than those contained herein.

 

(g) The undersigned understands and acknowledges that his, her or its purchase of the Securities is a speculative investment that involves a high degree of risk and the potential loss of their entire investment and has carefully read and considered the matters set forth in the Company’s reports filed with the U.S. Securities and Exchange Commission (“ SEC ”), including in particular the matters under the caption “Risk Factors” contained in the Company’s Annual Report on Form 10-K filed with the SEC on April 17, 2018.

 

2

 

 

(h) The undersigned’s overall commitment to investments that are not readily marketable is not disproportionate to the undersigned’s net worth, and an investment in the Securities will not cause such overall commitment to become excessive.

 

(i) The undersigned understands and agrees that the Securities may bear substantially the following legend until (i) such Securities shall have been registered under the Securities Act and effectively disposed of in accordance with a registration statement that has been declared effective or (ii) in the opinion of counsel for the Company such Securities may be sold without registration under the Securities Act, as well as any applicable “blue sky” or state securities laws:

 

THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR ANY APPLICABLE STATE SECURITIES LAWS. SUCH SECURITIES HAVE BEEN ACQUIRED FOR INVESTMENT PURPOSES AND MAY NOT BE OFFERED FOR SALE, SOLD, DELIVERED AFTER SALE, TRANSFERRED, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FILED BY THE ISSUER WITH THE U.S. SECURITIES AND EXCHANGE COMMISSION COVERING SUCH SECURITIES UNDER THE SECURITIES ACT OR AN OPINION OF COUNSEL SATISFACTORY TO THE ISSUER THAT SUCH REGISTRATION IS NOT REQUIRED.

 

(j) Neither the SEC nor any state securities commission has approved the Securities or passed upon or endorsed the merits of the offering or confirmed the accuracy or determined the adequacy of any information provided to Subscriber. This offering has not been reviewed by any Federal, state or other regulatory authority.

 

(k) The undersigned and his, her or its Advisors, if any, have had a reasonable opportunity to ask questions of and receive answers from a person or persons acting on behalf of the Company concerning the offering of the Securities and the business, financial condition, results of operations and prospects of the Company, and all such questions have been answered to the full satisfaction of the undersigned and his, her or its Advisors, if any.

 

(l) The undersigned is unaware of, is in no way relying on, and did not become aware of the offering of the Securities through or as a result of, any form of general solicitation or general advertising including, without limitation, any article, notice, advertisement or other communication published in any newspaper, magazine or similar media or broadcast over television or radio, or electronic mail over the Internet, in connection with the offering and sale of the Securities and is not subscribing for Securities and did not become aware of the offering of the Securities through or as a result of any seminar or meeting to which the undersigned was invited by, or any solicitation of a subscription by, a person not previously known to the undersigned in connection with investments in securities generally.

 

(m) The undersigned has taken no action which would give rise to any claim by any person for brokerage commissions, finders’ fees or the like relating to this Agreement or the transactions contemplated hereby.

 

(n) The undersigned is not relying on the Company with respect to the legal, tax, economic and related considerations of an investment in the Securities, and the undersigned has relied on the advice of, or has consulted with, only his, her or its own Advisors.

 

(o) The undersigned acknowledges that any estimates or forward-looking statements or projections included in the Company’s filings with the SEC were prepared by the management of the Company in good faith, but that the attainment of any such projections, estimates or forward-looking statements cannot be guaranteed by the Company or its management and should not be relied upon.

 

3

 

 

(p) No oral or written representations have been made, or oral or written information furnished, to the undersigned or his, her or its Advisors, if any, in connection with the offering of the Securities.

 

(q) The undersigned agrees, acknowledges and understands that during the period commencing on the date hereof through the Company’s public announcement of the transactions contemplated by the Merger Agreement, the undersigned will not directly or indirectly, through related parties, affiliates or otherwise, purchase, sell “short” or “short against the box” (as those terms are generally understood) any equity security of the Company.

 

(r) The foregoing representations, warranties and agreements will survive the completion of the offering.

 

3. Notices to Subscriber

 

(a) THE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OR THE SECURITIES LAWS OF ANY STATE AND ARE BEING OFFERED AND SOLD IN RELIANCE ON EXEMPTIONS FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND SUCH LAWS. THE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SEC, ANY STATE SECURITIES COMMISSION OR OTHER REGULATORY AUTHORITY, NOR HAVE ANY OF THE FOREGOING AUTHORITIES PASSED UPON OR ENDORSED THE MERITS OF THIS OFFERING OR THE ACCURACY OR ADEQUACY OF ANY INFORMATION PROVIDED TO SUBSCRIBER. ANY REPRESENTATION TO THE CONTRARY IS UNLAWFUL.

 

(b) THE SECURITIES ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE AND MAY NOT BE TRANSFERRED OR RESOLD EXCEPT AS PERMITTED UNDER THE SECURITIES ACT, AND APPLICABLE STATE SECURITIES LAWS, PURSUANT TO REGISTRATION OR EXEMPTION THEREFROM. SUBSCRIBER SHOULD BE AWARE THAT HE MAY BE REQUIRED TO BEAR THE FINANCIAL RISKS OF THIS INVESTMENT FOR AN INDEFINITE PERIOD OF TIME.

 

4. Miscellaneous Provisions

 

(a) Modification . Neither this Agreement, nor any provisions hereof, may be waived, modified, discharged or terminated except by an instrument in writing signed by the party against whom any waiver, modification, discharge or termination is sought.

 

(b) Survival . The undersigned’s representations and warranties made in this Subscription Agreement survive the execution and delivery of this Agreement and the delivery of the Securities.

 

(c) Notices . Any party may send any notice, request, demand, claim or other communication hereunder to the undersigned at the address set forth on the signature page of this Agreement or to the Company at the address set forth above using any means (including personal delivery, expedited courier, messenger service, fax, ordinary mail or email), but no such notice, request, demand, claim or other communication will be deemed to have been duly given unless and until it actually is received by the intended recipient. Any party may change the address to which notices, requests, demands, claims and other communications hereunder are to be delivered by giving the other parties written notice in the manner herein set forth.

 

4

 

 

(d) Binding Effect . Except as otherwise provided herein, this Agreement is binding upon, and inures to the benefit of, the parties to this Agreement and their heirs, executors, administrators, successors, legal representatives and assigns. If the undersigned is more than one person or entity, the obligation of the undersigned is joint and several and the agreements, representations, warranties and acknowledgments contained herein are deemed to be made by, and are binding upon, each such person or entity and his, her or its heirs, executors, administrators, successors, legal representatives and assigns. This Agreement sets forth the entire agreement and understanding between the parties as to the subject matter thereof and merges and supersedes all prior discussions, agreements and understandings of any and every nature among them.

 

(e) Assignability . This Agreement is not transferable or assignable by the undersigned.

 

(f) Governing Law and Venue . This Agreement is governed by and construed in accordance with the laws of the State of Delaware, without giving effect to conflicts of law principles. Each party to this Agreement hereby irrevocably submits to the exclusive jurisdiction and venue of the state courts of the State of Delaware or the United States District Court located in the State of Delaware for the purpose of any action between the parties arising in whole or in part under or in connection with this Agreement.

 

(g) Counterparts . This Agreement may be executed in two or more counterparts, each of which will be deemed an original, but all of which together will constitute one and the same instrument.

 

 

 

 

[Remainder of page left intentionally blank]

 

5

 

 

ALL SUBSCRIBERS MUST COMPLETE THIS PAGE

 

IN WITNESS WHEREOF, the undersigned has executed this Agreement on the 1 st day of February, 2019.

 

Manner in which Title is to be held (Please Check One ):

 

1. Individual   7. Trust/Estate/Pension or Profit Sharing Plan
            Date Opened:______________
             
2. Joint Tenants with Right of Survivorship   8. As a Custodian for
            ________________________________
            Under the Uniform Gift to Minors Act of the State of
            ________________________________
             
3. Community Property   9. Married with Separate Property
             
4. Tenants in Common   10. Keogh
             
5. Corporation/Partnership/ Limited Liability Company   11. Tenants by the Entirety
             
6. IRA        

 

ALTERNATIVE DISTRIBUTION INFORMATION

 

To direct distribution to a party other than the registered owner, complete the information below. YOU MUST COMPLETE THIS SECTION IF THIS IS AN IRA INVESTMENT.

 

Name of Firm (Bank, Brokerage, Custodian):    

 

Account Name:    

 

Account Number:   

 

Representative Name:    

 

Representative Phone Number:   

 

Address:   

 

City, State, Zip:   

 

IF MORE THAN ONE SUBSCRIBER, EACH SUBSCRIBER MUST SIGN.
INDIVIDUAL SUBSCRIBERS MUST COMPLETE THE NEXT PAGE.
SUBSCRIBERS WHICH ARE ENTITIES MUST COMPLETE THE PAGE THEREAFTER.

 

 

 

 

EXECUTION BY NATURAL PERSONS

 

Ursula Lampsa

 

Exact Name in Which Title is to be Held

 

     
Name (Please Print)   Name of Additional Purchaser
     
     
Residence: Number and Street   Address of Additional Purchaser
     
     
City, State and Zip Code   City, State and Zip Code
     
     
Social Security Number   Social Security Number
     
     
Telephone Number   Telephone Number
     
   
Fax Number (if available)   Fax Number (if available)
     
   
E-Mail   E-Mail (if available)
     
     
(Signature)   (Signature of Additional Purchaser)

 

ACCEPTED this 31 st day of January, 2019, on behalf of the Company.

 

  By: /s/ Damon Cuzick
    President

 

 

 

 

EXECUTION BY SUBSCRIBER WHICH IS AN ENTITY

(e.g., corporation, partnership, LLC, trust, etc.)

 

 

 

Name of Entity (Please Print)

 

Date of Incorporation or Organization:   

 

State of Principal Office:    

 

Federal Taxpayer Identification Number:    

 

   
Office Address  
   
   
City, State and Zip Code  
   
   
Telephone Number  
   
   
Fax Number (if available)  
   
   
E-Mail (if available)  

 

  By:  
    Name:
    Title:
   
   
   
   
  Address

 

ACCEPTED this _______ day of _______________ 2019, on behalf of the Company.

 

  By:                 
    President

 

 

 

 

Appendix A

 

INVESTOR QUESTIONNAIRE

 

Instructions: Check all boxes below which correctly describe you.

 

I am ( i ) a bank, as defined in Section 3(a)(2) of the Securities Act of 1933, as amended (the “ Securities Act ”), ( ii ) a savings and loan association or other institution, as defined in Section 3(a)(5)(A) of the Securities Act, whether acting in an individual or fiduciary capacity, ( iii ) a broker or dealer registered pursuant to Section 15 of the Securities Exchange Act of 1934, as amended (the “ Exchange Act ”), ( iv ) an insurance company as defined in Section 2(13) of the Securities Act, ( v ) an investment company registered under the Investment Company Act of 1940, as amended (the “ Investment Company Act ”), ( vi ) a business development company as defined in Section 2(a)(48) of the Investment Company Act, ( vii ) a Small Business Investment Company licensed by the U.S. Small Business Administration under Section 301 (c) or (d) of the Small Business Investment Act of 1958, as amended, ( viii ) a plan established and maintained by a state, its political subdivisions, or an agency or instrumentality of a state or its political subdivisions, for the benefit of its employees and you have total assets in excess of $5,000,000, or ( ix ) an employee benefit plan within the meaning of the Employee Retirement Income Security Act of 1974, as amended (“ ERISA ”) and ( 1 ) the decision that you shall subscribe for and purchase the Securities, is made by a plan fiduciary, as defined in Section 3(21) of ERISA, which is either a bank, savings and loan association, insurance company, or registered investment adviser, (2) you have total assets in excess of $5,000,000 and the decision that you shall subscribe for and purchase the Securities is made solely by persons or entities that are accredited investors, as defined in Rule 501 of Regulation D promulgated under the Securities Act (“ Regulation D ”) or ( 3 ) you are a self-directed plan and the decision that you shall subscribe for and purchase the Securities is made solely by persons or entities that are accredited investors.

 

I am a private business development company as defined in Section 202(a)(22) of the Investment Advisers Act of 1940, as amended.

 

I am an organization described in Section 501(c)(3) of the Internal Revenue Code of 1986, as amended (the “ Code ”), a corporation, Massachusetts or similar business trust or a partnership, in each case not formed for the specific purpose of making an investment in the Securities and with total assets in excess of $5,000,000.

 

I am a director or executive officer of the Company.

 

I am a natural person whose individual net worth, or joint net worth with my spouse, exceeds $1,000,000 at the time of my subscription for and purchase of the Securities. For purposes of this Subscription Agreement, “net worth” means the excess of total assets at fair market value, including real and personal property, but excluding the value of your primary residence, over total liabilities. Total liabilities excludes any mortgage on the primary residence in an amount of up to the home’s estimated fair market value, but includes (i) any mortgage amount in excess of the home’s fair market value and (ii) any mortgage amount that was borrowed during the 60-day period before the closing date for the sale of Securities for the purpose of investing in the Securities.

 

I am a natural person who had an individual income in excess of $200,000 in each of the two most recent years or joint income with my spouse in excess of $300,000 in each of the two most recent years, and who has a reasonable expectation of reaching the same income level in the current year.

 

A- 1

 

 

I am a trust, with total assets in excess of $5,000,000, not formed for the specific purpose of acquiring the Securities, whose subscription for and purchase of the Securities is directed by a sophisticated person as described in Rule 506(b)(2)(ii) of Regulation D.

 

I am an entity in which all of the equity owners are persons or entities described in one of the preceding paragraphs. Note : For Subscribers attempting to qualify under this item, each equity owner must complete, sign and return to the Company a separate copy of this Questionnaire).

 

I do NOT meet any of the foregoing categories.

 

The undersigned hereby represents and warrants that all of its answers to this Investor Questionnaire are true as of the date of its execution of the Subscription Agreement pursuant to which it purchased Securities of the Company.

 

Ursula Lampsa    
Name of Purchaser [please print]   Name of Co-Purchaser [please print]
     
/s/Ursula Lampsa    
Signature of Purchaser (Entities please   Signature of Co-Purchaser
provide signature of Purchaser’s duly    
authorized signatory.)  
     
     
Name of Signatory (Entities only)   Date
     
     
Title of Signatory (Entities only)    

 

A- 2

 

 

EXHIBIT A

 

SUBSCRIPTION SECURITIES

 

408,000 shares of Common Stock

 

 

 

 

 

 

 

 

 

Exhibit 10.4

 

THE SECURITIES OFFERED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR THE SECURITIES LAWS OF ANY STATE AND ARE BEING OFFERED AND SOLD IN RELIANCE UPON EXEMPTIONS FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. THE SECURITIES PURCHASED HEREUNDER MAY NOT BE TRANSFERRED OR RESOLD EXCEPT AS PERMITTED UNDER THE SECURITIES ACT AND OTHER APPLICABLE LAWS PURSUANT TO REGISTRATION OR EXEMPTION FROM REQUIREMENTS THEREUNDER.

 

EVO Transportation & Energy Services, Inc.

 

SUBSCRIPTION AGREEMENT

 

This Subscription Agreement (this “ Agreement ”) is made as of February 1, 2019 between EVO Transportation & Energy Services, Inc., a Delaware corporation (the “ Company ”) and John Lampsa (the “ Subscriber ”).

 

On the date hereof, the Subscriber and the Company consummated the transactions contemplated by that certain Agreement and Plan of Merger, dated December 15, 2018 (the “ Merger Agreement ”), pursuant to which the outstanding Equity Interests (as defined in the Merger Agreement) issued to Subscriber converted into the right to receive a portion of the Merger Consideration (as defined in the Merger Agreement) on the terms set forth in the Merger Agreement.

 

Pursuant to the terms of the Merger Agreement, Subscriber is willing to purchase, and the Company is willing to issue and sell to the Subscriber, the number of shares of common stock of the Company (the “ Securities ”) set forth on Exhibit A hereto, all on the terms and subject to the conditions set forth herein and in the Merger Agreement.

 

1 . Subscription and Purchase Price.

 

(a) Subscription . On the terms and subject to the conditions set forth herein and in the Merger Agreement, the undersigned hereby subscribes for and agrees to purchase the Securities set forth on Exhibit A hereto.

 

(b) The Subscriber understands and agrees that, subject to applicable laws, by executing this Agreement, he, she or it is entering into a binding agreement.

 

2. Subscriber’s Representations, Warranties and Agreements

 

The undersigned hereby acknowledges, agrees with and represents and warrants to the Company and its affiliates, as follows:

 

(a) The undersigned has full power and authority to enter into this Agreement, the execution and delivery of which has been duly authorized, if applicable, and this Agreement constitutes a valid and legally binding obligation of the undersigned.

 

 

 

 

(b) The undersigned acknowledges his, her or its understanding that the offering and sale of the Securities is intended to be exempt from registration under the Securities Act of 1933, as amended (the “ Securities Act ”), by virtue of Section 4(a)(2) of the Securities Act and the provisions of Regulation D promulgated thereunder (“ Regulation D ”). In furtherance thereof, the undersigned represents and warrants to the Company and its affiliates as follows:

 

(i) The undersigned is acquiring the Securities solely for the undersigned’s own beneficial account, for investment purposes, and not with view to, or resale in connection with, any distribution of the Securities;

 

(ii) The undersigned has the financial ability to bear the economic risk of his, her or its investment, has adequate means for providing for their current needs and contingencies, and has no need for liquidity with respect to the investment in the Company;

 

(iii) The undersigned and the undersigned’s attorney, accountant, purchaser representative and/or tax advisor, if any (collectively, “ Advisors ”), have received all documents requested by the undersigned or Advisors, if any, and have carefully reviewed them and understand the information contained therein, prior to the execution of this Agreement; and

 

(iv) The undersigned (together with his, her or its Advisors, if any) has such knowledge and experience in financial and business matters as to be capable of evaluating the merits and risks of the prospective investment in the Securities. If other than an individual, the undersigned also represents it has not been organized solely for the purpose of acquiring the Securities.

 

(c) The information in the Investor Questionnaire (attached as Appendix A ) completed and executed by the undersigned (the “ Investor Questionnaire ”) is true and accurate in all respects, and the undersigned is an “accredited investor,” as that term is defined in Rule 501(a) of Regulation D.

 

(d) The undersigned has relied on the advice of, or has consulted with, only his, her or its Advisors. Each Advisor, if any, is capable of evaluating the merits and risks of an investment in the Securities, and each Advisor, if any, has disclosed to the undersigned in writing (a copy of which is annexed to this Agreement) the specific details of any and all past, present or future relationships, actual or contemplated, between the Advisor and the Company or any affiliate thereof.

 

(e) The undersigned represents, warrants and agrees that he, she or it will not sell or otherwise transfer the Securities without registration under the Securities Act or an exemption therefrom, and fully understands and agrees that the undersigned must bear the economic risk of his, her or its purchase because, among other reasons, the Securities have not been registered under the Securities Act or under the securities laws of any state and, therefore, cannot be resold, pledged, assigned or otherwise disposed of unless they are subsequently registered under the Securities Act and under the applicable securities laws of such states, or an exemption from such registration is available. In particular, the undersigned is aware that the Securities are “restricted securities,” as such term is defined in Rule 144 promulgated under the Securities Act (“ Rule 144 ”), and they may not be sold pursuant to Rule 144 unless all of the conditions of Rule 144 are met. The undersigned also understands that, except as described in Section 5 of this Agreement, the Company is under no obligation to register the Securities on his, her or its behalf or to assist them in complying with any exemption from registration under the Securities Act or applicable state securities laws. The undersigned understands that any sales or transfers of the Securities are further restricted by state securities laws.

 

(f) No representations or warranties have been made to the undersigned by the Company, other than any representations of the Company contained herein, and in subscribing for the Securities the undersigned is not relying upon any representations other than those contained herein.

 

(g) The undersigned understands and acknowledges that his, her or its purchase of the Securities is a speculative investment that involves a high degree of risk and the potential loss of their entire investment and has carefully read and considered the matters set forth in the Company’s reports filed with the U.S. Securities and Exchange Commission (“ SEC ”), including in particular the matters under the caption “Risk Factors” contained in the Company’s Annual Report on Form 10-K filed with the SEC on April 17, 2018.

 

2

 

 

(h) The undersigned’s overall commitment to investments that are not readily marketable is not disproportionate to the undersigned’s net worth, and an investment in the Securities will not cause such overall commitment to become excessive.

 

(i) The undersigned understands and agrees that the Securities may bear substantially the following legend until (i) such Securities shall have been registered under the Securities Act and effectively disposed of in accordance with a registration statement that has been declared effective or (ii) in the opinion of counsel for the Company such Securities may be sold without registration under the Securities Act, as well as any applicable “blue sky” or state securities laws:

 

THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR ANY APPLICABLE STATE SECURITIES LAWS. SUCH SECURITIES HAVE BEEN ACQUIRED FOR INVESTMENT PURPOSES AND MAY NOT BE OFFERED FOR SALE, SOLD, DELIVERED AFTER SALE, TRANSFERRED, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FILED BY THE ISSUER WITH THE U.S. SECURITIES AND EXCHANGE COMMISSION COVERING SUCH SECURITIES UNDER THE SECURITIES ACT OR AN OPINION OF COUNSEL SATISFACTORY TO THE ISSUER THAT SUCH REGISTRATION IS NOT REQUIRED.

 

(j) Neither the SEC nor any state securities commission has approved the Securities or passed upon or endorsed the merits of the offering or confirmed the accuracy or determined the adequacy of any information provided to Subscriber. This offering has not been reviewed by any Federal, state or other regulatory authority.

 

(k) The undersigned and his, her or its Advisors, if any, have had a reasonable opportunity to ask questions of and receive answers from a person or persons acting on behalf of the Company concerning the offering of the Securities and the business, financial condition, results of operations and prospects of the Company, and all such questions have been answered to the full satisfaction of the undersigned and his, her or its Advisors, if any.

 

(l) The undersigned is unaware of, is in no way relying on, and did not become aware of the offering of the Securities through or as a result of, any form of general solicitation or general advertising including, without limitation, any article, notice, advertisement or other communication published in any newspaper, magazine or similar media or broadcast over television or radio, or electronic mail over the Internet, in connection with the offering and sale of the Securities and is not subscribing for Securities and did not become aware of the offering of the Securities through or as a result of any seminar or meeting to which the undersigned was invited by, or any solicitation of a subscription by, a person not previously known to the undersigned in connection with investments in securities generally.

 

(m) The undersigned has taken no action which would give rise to any claim by any person for brokerage commissions, finders’ fees or the like relating to this Agreement or the transactions contemplated hereby.

 

(n) The undersigned is not relying on the Company with respect to the legal, tax, economic and related considerations of an investment in the Securities, and the undersigned has relied on the advice of, or has consulted with, only his, her or its own Advisors.

 

(o) The undersigned acknowledges that any estimates or forward-looking statements or projections included in the Company’s filings with the SEC were prepared by the management of the Company in good faith, but that the attainment of any such projections, estimates or forward-looking statements cannot be guaranteed by the Company or its management and should not be relied upon.

 

3

 

 

(p) No oral or written representations have been made, or oral or written information furnished, to the undersigned or his, her or its Advisors, if any, in connection with the offering of the Securities.

 

(q) The undersigned agrees, acknowledges and understands that during the period commencing on the date hereof through the Company’s public announcement of the transactions contemplated by the Merger Agreement, the undersigned will not directly or indirectly, through related parties, affiliates or otherwise, purchase, sell “short” or “short against the box” (as those terms are generally understood) any equity security of the Company.

 

(r) The foregoing representations, warranties and agreements will survive the completion of the offering.

 

3. Notices to Subscriber

 

(a) THE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OR THE SECURITIES LAWS OF ANY STATE AND ARE BEING OFFERED AND SOLD IN RELIANCE ON EXEMPTIONS FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND SUCH LAWS. THE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SEC, ANY STATE SECURITIES COMMISSION OR OTHER REGULATORY AUTHORITY, NOR HAVE ANY OF THE FOREGOING AUTHORITIES PASSED UPON OR ENDORSED THE MERITS OF THIS OFFERING OR THE ACCURACY OR ADEQUACY OF ANY INFORMATION PROVIDED TO SUBSCRIBER. ANY REPRESENTATION TO THE CONTRARY IS UNLAWFUL.

 

(b) THE SECURITIES ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE AND MAY NOT BE TRANSFERRED OR RESOLD EXCEPT AS PERMITTED UNDER THE SECURITIES ACT, AND APPLICABLE STATE SECURITIES LAWS, PURSUANT TO REGISTRATION OR EXEMPTION THEREFROM. SUBSCRIBER SHOULD BE AWARE THAT HE MAY BE REQUIRED TO BEAR THE FINANCIAL RISKS OF THIS INVESTMENT FOR AN INDEFINITE PERIOD OF TIME.

 

4. Miscellaneous Provisions

 

(a) Modification . Neither this Agreement, nor any provisions hereof, may be waived, modified, discharged or terminated except by an instrument in writing signed by the party against whom any waiver, modification, discharge or termination is sought.

 

(b) Survival . The undersigned’s representations and warranties made in this Subscription Agreement survive the execution and delivery of this Agreement and the delivery of the Securities.

 

(c) Notices . Any party may send any notice, request, demand, claim or other communication hereunder to the undersigned at the address set forth on the signature page of this Agreement or to the Company at the address set forth above using any means (including personal delivery, expedited courier, messenger service, fax, ordinary mail or email), but no such notice, request, demand, claim or other communication will be deemed to have been duly given unless and until it actually is received by the intended recipient. Any party may change the address to which notices, requests, demands, claims and other communications hereunder are to be delivered by giving the other parties written notice in the manner herein set forth.

 

4

 

 

(d) Binding Effect . Except as otherwise provided herein, this Agreement is binding upon, and inures to the benefit of, the parties to this Agreement and their heirs, executors, administrators, successors, legal representatives and assigns. If the undersigned is more than one person or entity, the obligation of the undersigned is joint and several and the agreements, representations, warranties and acknowledgments contained herein are deemed to be made by, and are binding upon, each such person or entity and his, her or its heirs, executors, administrators, successors, legal representatives and assigns. This Agreement sets forth the entire agreement and understanding between the parties as to the subject matter thereof and merges and supersedes all prior discussions, agreements and understandings of any and every nature among them.

 

(e) Assignability . This Agreement is not transferable or assignable by the undersigned.

 

(f) Governing Law and Venue . This Agreement is governed by and construed in accordance with the laws of the State of Delaware, without giving effect to conflicts of law principles. Each party to this Agreement hereby irrevocably submits to the exclusive jurisdiction and venue of the state courts of the State of Delaware or the United States District Court located in the State of Delaware for the purpose of any action between the parties arising in whole or in part under or in connection with this Agreement.

 

(g) Counterparts . This Agreement may be executed in two or more counterparts, each of which will be deemed an original, but all of which together will constitute one and the same instrument.

 

 

 

 

[Remainder of page left intentionally blank]

 

5

 

 

ALL SUBSCRIBERS MUST COMPLETE THIS PAGE

 

IN WITNESS WHEREOF, the undersigned has executed this Agreement on the 1 st day of February, 2019.

 

 

Manner in which Title is to be held (Please Check One ):

 

1. Individual   7. Trust/Estate/Pension or Profit Sharing Plan
            Date Opened:______________
             
2. Joint Tenants with Right of Survivorship   8. As a Custodian for
            ________________________________
            Under the Uniform Gift to Minors Act of the State of
            ________________________________
             
3. Community Property   9. Married with Separate Property
             
4. Tenants in Common   10. Keogh
             
5. Corporation/Partnership/ Limited Liability Company   11. Tenants by the Entirety
             
6. IRA        

 

ALTERNATIVE DISTRIBUTION INFORMATION

 

To direct distribution to a party other than the registered owner, complete the information below. YOU MUST COMPLETE THIS SECTION IF THIS IS AN IRA INVESTMENT.

 

Name of Firm (Bank, Brokerage, Custodian):   

 

Account Name:   

 

Account Number:   

 

Representative Name:   

 

Representative Phone Number:   

 

Address:   

 

City, State, Zip:   

 

IF MORE THAN ONE SUBSCRIBER, EACH SUBSCRIBER MUST SIGN.
INDIVIDUAL SUBSCRIBERS MUST COMPLETE THE NEXT PAGE.
SUBSCRIBERS WHICH ARE ENTITIES MUST COMPLETE THE PAGE THEREAFTER.

 

 

 

 

EXECUTION BY NATURAL PERSONS

 

John Lampsa

 

Exact Name in Which Title is to be Held

 

 

     
Name (Please Print)   Name of Additional Purchaser
     
     
Residence: Number and Street   Address of Additional Purchaser
     
     
City, State and Zip Code   City, State and Zip Code
     
     
Social Security Number   Social Security Number
     
     
Telephone Number   Telephone Number
     
     
Fax Number (if available)   Fax Number (if available)
     
     
E-Mail   E-Mail (if available)
     
     
(Signature)   (Signature of Additional Purchaser)

 

ACCEPTED this 31 st day of January, 2019, on behalf of the Company.

 

  By: /s/ Damon Cuzick
    President

 

 

 

 

EXECUTION BY SUBSCRIBER WHICH IS AN ENTITY

(e.g., corporation, partnership, LLC, trust, etc.)

 

 

 

Name of Entity (Please Print)

 

Date of Incorporation or Organization:   

 

State of Principal Office:   

 

Federal Taxpayer Identification Number:   

 

   
Office Address  
   
   
City, State and Zip Code  
   
   
Telephone Number  
   
   
Fax Number (if available)  
   
   
E-Mail (if available)  

 

  By:
    Name:
    Title:
   
 
   
 
  Address

 

ACCEPTED this _______ day of _______________ 2019, on behalf of the Company.

 

  By:                 
    President

 

 

 

 

Appendix A

 

INVESTOR QUESTIONNAIRE

 

Instructions: Check all boxes below which correctly describe you.

 

I am ( i ) a bank, as defined in Section 3(a)(2) of the Securities Act of 1933, as amended (the “ Securities Act ”), ( ii ) a savings and loan association or other institution, as defined in Section 3(a)(5)(A) of the Securities Act, whether acting in an individual or fiduciary capacity, ( iii ) a broker or dealer registered pursuant to Section 15 of the Securities Exchange Act of 1934, as amended (the “ Exchange Act ”), ( iv ) an insurance company as defined in Section 2(13) of the Securities Act, ( v ) an investment company registered under the Investment Company Act of 1940, as amended (the “ Investment Company Act ”), ( vi ) a business development company as defined in Section 2(a)(48) of the Investment Company Act, ( vii ) a Small Business Investment Company licensed by the U.S. Small Business Administration under Section 301 (c) or (d) of the Small Business Investment Act of 1958, as amended, ( viii ) a plan established and maintained by a state, its political subdivisions, or an agency or instrumentality of a state or its political subdivisions, for the benefit of its employees and you have total assets in excess of $5,000,000, or ( ix ) an employee benefit plan within the meaning of the Employee Retirement Income Security Act of 1974, as amended (“ ERISA ”) and ( 1 ) the decision that you shall subscribe for and purchase the Securities, is made by a plan fiduciary, as defined in Section 3(21) of ERISA, which is either a bank, savings and loan association, insurance company, or registered investment adviser, (2) you have total assets in excess of $5,000,000 and the decision that you shall subscribe for and purchase the Securities is made solely by persons or entities that are accredited investors, as defined in Rule 501 of Regulation D promulgated under the Securities Act (“ Regulation D ”) or ( 3 ) you are a self-directed plan and the decision that you shall subscribe for and purchase the Securities is made solely by persons or entities that are accredited investors.

 

I am a private business development company as defined in Section 202(a)(22) of the Investment Advisers Act of 1940, as amended.

 

I am an organization described in Section 501(c)(3) of the Internal Revenue Code of 1986, as amended (the “ Code ”), a corporation, Massachusetts or similar business trust or a partnership, in each case not formed for the specific purpose of making an investment in the Securities and with total assets in excess of $5,000,000.

 

I am a director or executive officer of the Company.

 

I am a natural person whose individual net worth, or joint net worth with my spouse, exceeds $1,000,000 at the time of my subscription for and purchase of the Securities. For purposes of this Subscription Agreement, “net worth” means the excess of total assets at fair market value, including real and personal property, but excluding the value of your primary residence, over total liabilities. Total liabilities excludes any mortgage on the primary residence in an amount of up to the home’s estimated fair market value, but includes (i) any mortgage amount in excess of the home’s fair market value and (ii) any mortgage amount that was borrowed during the 60-day period before the closing date for the sale of Securities for the purpose of investing in the Securities.

 

I am a natural person who had an individual income in excess of $200,000 in each of the two most recent years or joint income with my spouse in excess of $300,000 in each of the two most recent years, and who has a reasonable expectation of reaching the same income level in the current year.

 

A- 1

 

 

I am a trust, with total assets in excess of $5,000,000, not formed for the specific purpose of acquiring the Securities, whose subscription for and purchase of the Securities is directed by a sophisticated person as described in Rule 506(b)(2)(ii) of Regulation D.

 

I am an entity in which all of the equity owners are persons or entities described in one of the preceding paragraphs. Note : For Subscribers attempting to qualify under this item, each equity owner must complete, sign and return to the Company a separate copy of this Questionnaire).

 

I do NOT meet any of the foregoing categories.

 

The undersigned hereby represents and warrants that all of its answers to this Investor Questionnaire are true as of the date of its execution of the Subscription Agreement pursuant to which it purchased Securities of the Company.

 

John Lampsa    
Name of Purchaser [please print]   Name of Co-Purchaser [please print]
     
/s/ John Lampsa    
Signature of Purchaser (Entities please   Signature of Co-Purchaser
provide signature of Purchaser’s duly    
authorized signatory.)    
     
     
Name of Signatory (Entities only)   Date
     
     
Title of Signatory (Entities only)    

 

A- 2

 

 

EXHIBIT A

 

SUBSCRIPTION SECURITIES

 

392,000 shares of Common Stock