Exhibit 10.1

EXECUTION VERSION

AGREEMENT AND PLAN OF MERGER

dated as of December 21, 2022

by and among

1847 ICU HOLDINGS INC., as the Buyer

1847 ICU ACQUISITION SUB INC., as Merger Sub

ICU EYEWEAR HOLDINGS INC.

and

SAN FRANCISCO EQUITY PARTNERS, as the Stockholder Representative

TABLE OF CONTENTS

TABLE OF CONTENTS

AGREEMENT AND PLAN OF MERGER

This AGREEMENT AND PLAN OF MERGER (this “Agreement”) is dated as of December 21, 2022, among 1847 ICU HOLDINGS Inc., a Delaware corporation (the “Buyer”), 1847 ICU ACQUISITION SUB Inc., a Delaware corporation (the “Merger Sub”), ICU Eyewear Holdings Inc., a California corporation (the “Company”) and SAN FRANCISCO EQUITY PARTNERS, in its capacity as the representative of the Stockholders (the “Stockholder Representative”). The Buyer, Merger Sub, the Majority Stockholders and the Stockholder Representative are from time to time herein each referred to as a “Party”, and collectively as the “Parties.”

BACKGROUND

WHEREAS, immediately prior to the consummation of the transactions contemplated by this Agreement, the Majority Stockholders and Stockholders who are not Majority Stockholders are the record and beneficial owners of all of the outstanding shares (the “Securities”) of capital stock of the Company, which consists of Common Stock (defined below) and Preferred Stock (defined below) in the specific amounts and classes set forth opposite each Stockholder’s name on Schedule 1; and

WHEREAS, immediately prior to the consummation of the transactions contemplated by this Agreement, the Persons listed as owners of the Options on Schedule 1 (each an “Optionholder”) hold Options to acquire shares of Common Stock or other Securities, in the specific amounts set forth opposite each Optionholder’s name on Schedule 1, all of which Options will be cancelled simultaneously with the Effective Time; and

WHEREAS, pursuant to this Agreement, at the Effective Time, Merger Sub will merge with and into the Company, with the Company surviving as a direct wholly-owned subsidiary of Buyer on the terms and subject to the conditions set forth herein (the “Merger”); and

WHEREAS, the respective board of directors or board of managers of the Company, Buyer, and Merger Sub have each (1) determined that the Merger is fair, advisable and in the best interests of their respective companies and stockholders or members and (2) approved this Agreement and the transactions contemplated hereby, including the Merger; and

WHEREAS, the board of directors of the Company has determined to recommend to the Company’s stockholders the approval and adoption of this Agreement and the transactions contemplated hereby, including the Merger;

WHEREAS, concurrently with the execution and delivery of this Agreement, the Company is delivering to Buyer and Merger Sub a written consent of the Requisite Percentage of its voting stockholders evidencing their adoption of this Agreement and approval of the Merger and the other transactions contemplated hereby as required by the [California Corporate Code] and the Company’s Governing Documents; and

WHEREAS, concurrently with the execution and delivery of this Agreement, certain Stockholders are delivering to Buyer and Merger Sub Letters of Transmittal from such Stockholders holding the Requisite Percentage.

AGREEMENT

NOW THEREFORE, in consideration of the foregoing premises and the respective representations and warranties, covenants and agreements contained herein, the parties hereto agree as follows:

Article I
DEFINITIONS

Section 1.01 Certain Definitions.

(a) When used in this Agreement, the following terms will have the meanings assigned to them in this Section 1.01 and other defined terms will have the meanings given to them elsewhere in this Agreement:

“Accounts Receivable” means accounts receivable, trade receivables, and other similar receivables, and any security, claim, remedy, or other right related to any of the foregoing, in each case relating to or arising out of the business of the Company.

“Action” means any claim, action, suit, inquiry, hearing, proceeding or other investigation.

“Affiliate” means, with respect to a Person, any other Person that, directly or indirectly, through one or more intermediaries, controls, is controlled by or is under common control with, such Person, excluding any portfolio company of such Person unless such portfolio company receives or has received any Confidential Information or is bound by a duty of confidentiality pursuant to a confidentiality or non-disclosure agreement with respect thereto (it being understood that possession or knowledge of Confidential Information by a director, officer or employee of such Person who is a member of the board of directors (or similar governing body) or officer or employee of any such portfolio company shall not, in and of itself, result in such Confidential Information being deemed to have been received by such portfolio company). For purposes of this definition, “control” (including the terms “controlled by” and “under common control with”) means possession of the power to direct or cause the direction of the management or policies of a Person, whether through the ownership of stock, membership interests or other equity interests, as trustee or executor, by Contract or otherwise.

“Ancillary Agreements” means the Stockholders Subordinated Notes.

“Benefit Plan” means any “employee benefit plan” as defined in ERISA Section 3(3), including any (i) nonqualified deferred compensation or retirement plan or arrangement which is an Employee Pension Benefit Plan (as defined in ERISA Section 3(2)), (ii) qualified defined contribution retirement plan or arrangement which is an Employee Pension Benefit Plan, (iii) qualified defined benefit retirement plan or arrangement which is an Employee Pension Benefit Plan (including any Multiemployer Plan (as defined in ERISA Section 3(37)), (iv) Employee Welfare Benefit Plan (as defined in ERISA Section 3(1)) or material fringe benefit plan or program, or (v) stock purchase, stock option, severance pay, change-in-control, vacation pay, company award, salary continuation, sick leave, excess benefit, bonus or other incentive compensation, life insurance, or other employee benefit plan, contract, program, policy or other arrangement, whether or not subject to ERISA, under which any present or former employee of the Company has any present or future right to benefits sponsored or maintained by the Company or any ERISA Affiliate.

“Business Day” means a day other than a Saturday, Sunday or other day on which banks located in New York, New York are authorized or required by Law to close.

“CCC” shall mean the California Corporations Code.

“Cash Portion” means (a) Four Million Dollars ($4,000,000) minus (b) the amount of any unpaid Indebtedness of the Company existing as of the Closing Date, minus (c) any Transaction Expenses.

“Closing” and “Closing Date” have the respective meanings set forth in Section 2.04.

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

“Common Stock” shall mean shares of the Company’s common stock, $0.001 par value.

“Company Indebtedness” means Indebtedness of the Company as of the Effective Date.

“Company Stock Plan” means the ICU Eyewear Holdings, Inc. Stock Incentive Plan and any other benefit plan or arrangement of the Company pursuant to which shares of Common Stock are issued to Persons as part of a compensation arrangement or in exchange for services rendered to the Company.

“Contract” means any written agreement, contract, commitment, arrangement or understanding.

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended.

“ERISA Affiliate” means any Person who is, or at any time was, a member of a “controlled group of corporations” within the meaning of Section 414(b) or (c) of the Code and, for the purpose of Section 302 of ERISA and/or Section 412, 4971, 4977, 4980D, 4980E and/or each “applicable section” under Section 414(f)(2) of the Code, within the meaning of Section 412(n)(6) of the Code that includes, or at any time included, the Company or any Affiliate thereof, or any predecessor of any of the foregoing.

“Fraud” means actual common law fraud as defined under Delaware law with the elements of scienter and reliance in the making of representations or warranties of the Company in this Agreement.

“GAAP” means United States generally accepted accounting principles as in effect on the date hereof.

“Governmental Entity” means any entity or body exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to United States federal, state or local government or foreign, international, multinational or other government, including any department, commission, board, agency, bureau, official or other regulatory, administrative or judicial authority thereof.

“Indebtedness” means (a) all obligations of the Company for borrowed money; (b) all obligations of the Company evidenced by bonds, debentures, notes or similar instruments; (c) all obligations of others for borrowed money secured by (or for which the holder of such obligation has an existing right, contingent or otherwise, to be secured by) any Encumbrance on property owned or acquired by the Company, whether or not the obligation secured thereby has been assumed; (d) all guarantees by the Company of obligations of others for borrowed money; and (e) all obligations, contingent or otherwise, of the Company as an account party in respect of letters of credit and letters of guaranty.

“Intellectual Property” means all intellectual property and other similar proprietary rights in any jurisdiction worldwide, whether registered or unregistered, including such rights in and to: (i) patents (including all reissues, divisions, provisionals, continuations and continuations-in-part, re-examinations, renewals and extensions thereof), patent applications, patent disclosures or other patent rights; (ii) copyrights, design, design registration, and all registrations, applications for registration, and renewals for any of the foregoing, and any “moral” rights; (iii) trademarks, service marks, trade names, business names, logos, trade dress, certification marks and other indicia of commercial source or origin together with all goodwill associated with the foregoing, and all registrations, applications and renewals for any of the foregoing; (iv) trade secrets and business, technical and know-how information, databases, data collections and other confidential and proprietary information and all rights therein; (v) software, including data files, source code, object code, application programming interfaces, architecture, files, records, schematics, computerized databases and other software-related specifications and documentation; and (vi) Internet domain name registrations.

“Inventory” means all inventories of raw materials, supplies, work-in-process, finished goods, and other materials used in or held for use in the business of the Company.

“IRS” means the Internal Revenue Service.

“Knowledge of the Company” means the actual knowledge of any one or more of the Majority Stockholders after reasonable inquiry and the actual knowledge of Kirk Hobbs, who is not a Majority Stockholder, after reasonable inquiry of his or her direct reports with operational responsibility for the fact or matter in question; it being understood and agreed that a review of one’s files shall satisfy such reasonable inquiry.

“Law” means any statute, law, ordinance, rule or regulation of any Governmental Entity.

“Liability” means all Indebtedness, obligations and other liabilities and contingencies of a Person, whether absolute, accrued, contingent, fixed or otherwise, or whether due or to become due.

“Lien” means, with respect to any property or asset, any mortgage, lien, pledge, charge, security interest, hypothecation or other encumbrance in respect of such property or asset.

“Majority Stockholders” mean the following Stockholders who own shares of Preferred Stock and/or a majority of the shares of Common Stock in such amounts and classes as listed on Schedule 1 hereto: Oceanus; San Francisco Equity Partners III, LP; San Francisco Equity Partners II, LP; San Francisco Equity Partners LP; Pacific Community Ventures Investment Partners III, LLC; and Hsueh-Chih Chao Lan.

“Material Adverse Effect” means any material adverse effect on the assets, properties, or condition (financial or otherwise), of the Company or the Buyer, as the case may be; provided, that in the case of the Company, none of the following (individually or in combination) shall be deemed to constitute, or shall be taken into account in determining whether there has been, a Material Adverse Effect: (a) any adverse effect resulting directly or indirectly from general business or economic conditions, except to the extent such general business or economic conditions have a materially disproportionate effect on the Company as compared to any of the other companies in the Company’s industry, in which case only the incremental disproportionate adverse impact may be taken into account in determining whether there has occurred a Material Adverse Effect; (b) any adverse effect resulting directly or indirectly from conditions generally affecting any industry or industry sector in which the Company operates or competes, except to the extent such adverse effect has a materially disproportionate effect on the Company as compared to any of the other companies in the Company’s industry or industry sector, in which case only the incremental disproportionate adverse impact may be taken into account in determining whether there has occurred a Material Adverse Effect; (c) any adverse effect resulting from changes in regulatory, legislative or political conditions in the United States or any other country or region in the world, except to the extent such change in regulatory, legislative or political condition has a materially disproportionate effect on the Company as compared to any of the other companies in the Company’s industry, in which case only the incremental disproportionate adverse impact may be taken into account in determining whether there has occurred a Material Adverse Effect; (d) any geopolitical conditions, outbreak of hostilities, acts of war, sabotage, cyber attacks, terrorism or military actions (including any escalation or general worsening of any such hostilities, acts of war, sabotage, cyber attacks, terrorism or military actions), pandemic or epidemic (including the COVID-19 pandemic, including the continuation or worsening of the COVID-19 pandemic) in the United States or any other country or region in the world, except to the extent such conditions or actions has a materially disproportionate effect on the Company as compared to any of the other companies in the Company’s industry or geographies in which the Company operates, in which case only the incremental disproportionate adverse impact may be taken into account in determining whether there has occurred a Material Adverse Effect; (e) any adverse effect resulting directly or indirectly from the announcement, execution or delivery of the Agreement, the Ancillary Agreements or the pendency or consummation of the transactions contemplated hereby or thereby, including any disruption in (or loss of) supplier, service provider, partner or similar relationships or any loss of employees; (f) any adverse effect resulting directly or indirectly from any change in accounting requirements or principles or any change in applicable Laws or the interpretation thereof; (g) any adverse effect resulting directly or indirectly from (i) any action taken by the Company at Buyer’s direction, (ii) any action referred to in taken by the Company with Buyer’s consent, (iii) the failure to take any action referred to in Section 5.02 that was not taken by the Company because Buyer withheld its consent; (h) the failure of the Company to meet internal expectations or projections; (i) any adverse effect resulting directly or indirectly from any breach by Buyer of any provision of this Agreement or the taking of any other action by Buyer; (j) the availability or cost of equity, debt or other financing to Buyer; or (k) any matter disclosed in the Disclosure Schedule to the extent the effect is reasonably foreseeable from the disclosure therein or the documents referenced therein.

“Merger Consideration” means (a) the Cash Portion plus (b) the Stockholder Subordinated Notes in the aggregate principal amount of Five Hundred Thousand Dollars ($500,000) payable to the Stockholders on the one-year anniversary of the Effective Date as set forth on Schedule 1 hereto.

“Net Working Capital” means (i) Accounts Receivable; plus (ii) Inventory; plus (iii) prepaid expenses and other current assets of the Company as of the Closing Date excluding cash; less (iv) current accounts payable, accrued liabilities and outstanding checks and other current liabilities as of the Closing Date and in accordance with Section 2.02(a).

“Net Working Capital Target” means $6,600,000.

“Order” means any award, injunction, judgment, decree, order, ruling, subpoena or verdict or other decision issued, promulgated or entered by or with any Governmental Entity of competent jurisdiction.

“Permit” means any authorization, approval, consent, certificate, license, clearance, permit or franchise of or from any Governmental Entity of competent jurisdiction or pursuant to any Law.

“Permitted Liens” means (i) Liens for current Taxes that are not yet due and payable or that may hereafter be paid without material penalty or that are being contested in good faith, (ii) statutory Liens of landlords and workers,’ carriers’ and mechanics’ or other like Liens incurred in the ordinary course of business not yet overdue or that are being contested in good faith, (iii) Liens, easements, servitudes, covenants, conditions, restrictions, encroachments and other similar non-monetary matters affecting title to any assets of the Company and other title defects which do not materially interfere with the present or proposed use of the properties by the Company or assets they affect taken as a whole, (iv) zoning, building codes, and other land use Laws regulating the use or occupancy of leased real property or the activities conducted thereon that are imposed by any Governmental Entity having jurisdiction over such leased real property and which are not violated in any material respect by the current use and operation of such leased real property or the operation of the business of the Company, (v) Liens that will be released prior to or as of the Closing, (vi) Liens arising under this Agreement, (vii) Liens created by or through the Buyer, or (viii) Liens that, individually or in the aggregate, do not materially interfere with the ability of the Company to conduct its business as currently conducted and do not materially adversely affect the value of, or the ability to sell, such personal properties and assets.

“Person” means an individual, a corporation, a partnership, a limited liability company, a trust, an unincorporated association, a Governmental Entity or any agency, instrumentality or political subdivision of a Governmental Entity, or any other entity or body.

“Preferred Stock” means shares of authorized capital stock of the Company designated as (i) Series A-2 convertible preferred stock, $0.001 par value, (ii) Series A-1 convertible preferred stock, $0.001 par value, and (iii) Series A convertible preferred stock, $0.001 par value, in each case having the terms, rights and designations set forth in the Company’s Certificate of Incorporation and any related certificate(s) of designation.

“Representatives” means, with respect to any Person, the respective directors, officers, employees, counsel, accountants and other representatives of such Person.

“Stockholders Subordinated Notes” Five Hundred Thousand Dollar ($500,000) of the principal amount with a term of one-year from the Effective Date, be subordinated, and accrue interest at a rate of 6% annually payable upon maturity on the terms, as set forth in the unsecured promissory note issued by the Buyer in a form reasonably acceptable to each of the Buyer and the Company.

“Stockholder” means any Person that owns Common Stock or Preferred Stock of the Company.

“Subsidiary” means, with respect to any Person, any corporation, partnership, joint venture or other legal entity of which such Person (either alone or through or together with any other Subsidiary), owns, directly or indirectly, more than 50% of the stock or other equity interests, the holders of which are generally entitled to vote for the election of the board of directors or other governing body of a non-corporate Person.

“Taxes” means all federal, state, local and foreign income, profits, franchise, gross receipts, environmental, customs duty, capital stock, severance, stamp, payroll, sales, transfer, employment, unemployment, disability, use, property, withholding, excise, production, value added, occupancy and other taxes, duties or assessments of any nature whatsoever, in each case, imposed by any Taxing Authority.

“Taxing Authority” means any Governmental Entity having or purporting to exercise jurisdiction with respect to any Tax.

“Tax Returns” means any return, declaration, report, claim for refund, or information return or statement relating to Taxes, including any schedule or attachment thereto, and including any amendment thereof, filed or required to be filed with any Taxing Authority.

“Transaction Expenses” means, to the extent not paid by the Company before the Closing, the amount of all fees, costs and expenses (including legal, accounting, investment banking, broker’s, finder’s and other professional or advisory fees and expenses) of the Company incurred by or on behalf of, or to be paid by, the Company in connection with the negotiation and execution of this Agreement and the other transaction documents and the consummation of the Merger.

“Transaction Proposal” means any written bona fide proposal made by a third party relating to (i) any direct or indirect acquisition or purchase of all or substantially all of the assets of the Company, (ii) any direct or indirect acquisition or purchase of a majority of the combined voting power of the Securities, (iii) any merger, consolidation, business combination, recapitalization, liquidation, dissolution or similar transaction involving the Company in which the other party thereto or its stockholders will own 51% or more of the combined voting power of the parent entity resulting from any such transaction, or (iv) the entry into any agreement to, or effecting any transaction that is materially inconsistent with the implementation of the transactions contemplated hereby.

“$” means United States dollars.

(b) For purposes of this Agreement, except as otherwise expressly provided herein or unless the context otherwise requires: (i) the meaning assigned to each term defined herein will be equally applicable to both the singular and the plural forms of such term and vice versa, and words denoting any gender will include all genders as the context requires; (ii) where a word or phrase is defined herein, each of its other grammatical forms will have a corresponding meaning; (iii) the terms “hereof”, “herein”, “hereunder”, “hereby” and “herewith” and words of similar import will, unless otherwise stated, be construed to refer to this Agreement as a whole and not to any particular provision of this Agreement; (iv) when a reference is made in this Agreement to an Article, Section, paragraph, Exhibit or Schedule without reference to a document, such reference is to an Article, Section, paragraph, Exhibit or Schedule to this Agreement; (v) a reference to a subsection without further reference to a Section is a reference to such subsection as contained in the same Section in which the reference appears, and this rule will also apply to paragraphs and other subdivisions; (vi) the word “include”, “includes” or “including” when used in this Agreement will be deemed to include the words “without limitation”, unless otherwise specified; (vii) a reference to any party to this Agreement or any other agreement or document will include such party’s predecessors, successors and permitted assigns; (viii) a reference to any Law means such Law as amended, modified, codified, replaced or reenacted as of the date hereof, and all rules and regulations promulgated thereunder as of the date hereof; and (ix) the term “as of the Closing,” “as of the Closing Date,” “as of the Effective Time” or “at the Effective Time” when used to calculate financial amounts in this Agreement will be as of 11:59 p.m. New York time on the Closing Date.

Article II
MERGER

Section 2.01 Merger. At the Effective Time, and subject to and upon the terms and conditions of this Agreement and the applicable provisions of the DGCL and CCC, Merger Sub shall be merged with and into the Company, and the separate corporate existence of Merger Sub shall cease and the Company shall continue as the surviving corporation (the “Surviving Corporation”). The Merger shall have the effects set forth in this Agreement and in the applicable provisions of the DGCL and CCC. Without limiting the generality of the foregoing, and subject thereto, at the Effective Time, all the property, rights, privileges, powers and franchises of the Company and Merger Sub shall vest in the Surviving Corporation, and all debts, Liabilities and duties of the Company and Merger Sub shall become the debts, Liabilities and duties of the Surviving Corporation, and the Surviving Corporation shall be a direct wholly-owned subsidiary of Buyer.

Section 2.02 The Closing; Effective Time.

(a) Closing. The consummation of the Merger and the other transactions contemplated hereby (the “Closing”) will take place by the reciprocal delivery of closing documents by electronic mail, regular mail, fax or any other means mutually agreed upon by the parties on the day on which the last of the conditions to closing contained in Article VI of this Agreement (other than any conditions that by their nature are to be satisfied at the Closing) are satisfied or waived in accordance with this Agreement or such other date as the Buyer, Merger Sub and the Company may mutually determine (the date on which the Closing actually occurs is referred to as the “Closing Date”).

(b) Subject to the provisions of this Agreement, on the Closing Date, the Parties shall cause the Merger to be consummated by filing the certificate of merger in customary form and substance for the Merger (“Certificate(s) of Merger”), in accordance with the applicable provisions of the DGCL, with the Secretary of State of Delaware and in accordance with the applicable provisions of the CCC, with the Secretary of State of California. The Merger shall become effective at 11:59 p.m. Eastern Time on the date the Certificates of Merger are filed with the Secretary of State of Delaware and the Secretary of State of California, respectively (such time as the Merger becomes effective, the “Effective Time”).

Section 2.03 Certificate of Incorporation and Bylaws; Board and Officers. From and after the Effective Time, by virtue of the Merger and without any action on the part of the Parties or any other Person:

(a) the Certificate of Incorporation of the Company, as in effect immediately prior to the Effective Time, shall be amended and restated in a form reasonably acceptable to Buyer and the Company and shall be the certificate of incorporation of the Surviving Corporation;

(b) the bylaws of the Company, as in effect immediately prior to the Effective Time, shall be amended and restated in in a form reasonably acceptable to Buyer and the Company and shall be the bylaws of the Surviving Corporation; and

(c) the directors and officers of Merger Sub immediately prior to the Effective Time shall be the directors and officers, respectively, of the Surviving Corporation immediately after the Effective Time.

Section 2.04 Effects of the Merger. By virtue of the Merger and without any further action on the part of Buyer, Merger Sub, the Company or any other Person, the following shall occur:

(a) Treasury Stock. At the Effective Time, all capital stock of the Company held by the Company as treasury stock immediately prior to the Effective Time shall be automatically cancelled and will cease to exist, and no consideration will be delivered in exchange therefor.

(b) Company Capital Stock. At the Effective Time, each (i) issued and outstanding share of Preferred Stock (other than Securities to be cancelled in accordance with Section 2.04(a) and any Dissenting Shares) shall be automatically cancelled and converted into the right to receive its applicable portion of the Merger Consideration in the amount set forth on Schedule 1 (the “Allocated Portion”), without any interest thereon and subject to any withholding taxes required by applicable law and (ii) each issued and outstanding share of Common Stock shall be cancelled without any consideration paid therefor.] For the avoidance of doubt, as of the Effective Time, all shares of Common Stock and Preferred Stock shall no longer be outstanding and shall automatically be cancelled and shall cease to exist, and each holder of Securities shall thereafter cease to have any rights with respect thereto (except the right to receive the consideration set forth in this Section 2.04(b)). At the Closing, Buyer will deliver to each Selling Stockholder holding shares of Preferred Stock immediately prior to the Effective Date its Allocated Portion to an account or accounts designated by the Majority Stockholders in writing prior to the Closing.

(c) Merger Sub Common Stock. At the Effective Time, each issued and outstanding share of common stock, par value $0.001 per share, of Merger Sub issued and outstanding immediately prior to the Effective Time will be converted into one validly issued, fully paid and non-assessable share of common stock, par value $0.001 per share, of the Surviving Corporation, and will constitute the only outstanding shares of capital stock of the Surviving Corporation.

(d) Cancellation of Stock Options. Prior to the Effective Time, the Company shall take all actions necessary and appropriate to provide that, immediately prior to the Effective Time, each unexpired and unexercised option or similar right to purchase Company Common Stock (each, an ” Option”), under any Company Stock Plan, whether or not then exercisable or vested, shall be cancelled, without payment made in exchange therefor.

(e) Impact of Stock Splits, Etc. In the event of any change in the number of Securities, or securities convertible or exchangeable into or exercisable for Securities issued and outstanding after the date of this Agreement and prior the Effective Time by reason of any stock split, reverse stock split, stock dividend, subdivision, reclassification, recapitalization, combination, exchange of shares or the like, the Merger Consideration shall be equitably adjusted to provide to the holders of Securities the same economic effect as contemplated by this Agreement prior to such event.

(f) Tax Treatment. For income Tax purposes, the Parties agree to treat the merger of Merger Sub with and into the Company as a sale of the Securities from the Stockholders to Buyer.

Section 2.05 Payments. The Buyer shall make payment of the Merger Consideration as set forth in this Section 2.05. The Merger Consideration shall be allocated among the Stockholders of the Company in accordance with their respective Allocated Portion as set forth in Schedule 1. On the Closing Date, the Buyer shall make payment of the aggregate Merger Consideration, subject to adjustment as described in Section 2.07 below, by wire transfer of immediately available funds to the accounts designated in writing by the Stockholder Representative (as defined below) at least two (2) Business Days prior to the Closing Date.

Section 2.06 Stockholder Representative. The Stockholders, by virtue of their approval of this Agreement, will be deemed to have irrevocably constituted and appointed, effective as of the Effective Time, San Francisco Equity Partners (together with its permitted successors, the “Stockholder Representative”), as their true and lawful agent and attorney-in-fact to enter into any agreement in connection with the transactions contemplated by this Agreement, to exercise all or any of the powers, authority and discretion conferred on him or her under any such agreement, to waive any terms and conditions of any such agreement (other than the Merger Consideration), to give and receive notices on their behalf and to be their exclusive representative with respect to any matter, suit, claim, action or proceeding arising with respect to any transaction contemplated by any such agreement and the Stockholder Representative agrees to act as, and to undertake the duties and responsibilities of, such agent and attorney-in-fact. This power of attorney is coupled with an interest and irrevocable. The Stockholders Representative shall not be liable for any action taken or not taken by it in connection with its obligations under this Agreement (i) with the consent of stockholders who, as of the date of this Agreement owned more than fifty percent (50%) in interest of the outstanding Securities or (ii) in the absence of its own gross negligence or willful misconduct. If the Stockholder Representative shall be unable or unwilling to serve in such capacity, its successor shall be named by those persons holding more than fifty percent (50%) in interest of the Securities outstanding at the Effective Time who shall serve and exercise the powers of Stockholder Representative hereunder.

Section 2.07 Working Capital Adjustment.

(a) Prior to the Closing, the Company shall deliver to Buyer an unaudited balance sheet of the Company (the “Adjustment Balance Sheet”) as of the month end immediately prior to the Closing Date together with a certificate stating that the Adjustment Balance Sheet was prepared in accordance with GAAP and consistent with the Company’s past practices so as to present fairly in all material respects the financial condition of the Company as of such date. Buyer shall have a reasonable period of time to review the Adjustment Balance Sheet and related work papers and ask questions of the Company and the Company’s accountant regarding the same until the Parties mutually agree on the Adjustment Balance Sheet. If the Parties fail to mutually agree on the Adjustment Balance Sheet, then the Buyer may terminate this Agreement in accordance with Section 7.01(d) hereof.

(b) If the Net Working Capital as reflected on the Adjustment Balance Sheet exceeds the Net Working Capital Target, then the Aggregate Principal Amount shall be increased by such excess. If the Net Working Capital Target exceeds the Net Working Capital as reflected on the Adjustment Balance Sheet, then the Aggregate Principal Amount shall be decreased by such excess. Any such adjustment shall be treated as an adjustment to the Purchase Price.

(c) As soon as practicable following the Closing Date (but not later than sixty (60) days after the Closing Date), the Buyer shall cause its auditor to prepare and deliver to the Stockholder Representative an unaudited balance sheet of the Company (the “Closing Date Balance Sheet”) as of the Closing Date. The Closing Date Balance Sheet shall be prepared in accordance with GAAP in a manner consistent with the Adjustment Balance Sheet so as to present fairly in all material respects the financial condition of the Company. The Stockholder Representative shall cooperate with the Buyer and its auditor and provide all reasonable information requested by the Buyer and its auditor as necessary to prepare the Closing Date Balance Sheet.

(d) If the Net Working Capital as reflected on the Closing Date Balance Sheet exceeds the Net Working Capital as reflected on the Adjustment Balance Sheet, then the Aggregate Principal Amount shall be increased by such excess. If the Net Working Capital as reflected on the Adjustment Balance Sheet exceeds the Net Working Capital as reflected on the Closing Date Balance Sheet, then the Aggregate Principal Amount shall be decreased by such excess. Any such adjustment shall be treated as an adjustment to the Purchase Price.

(e) In the event the Stockholder Representative does not agree with the Net Working Capital as reflected on the Closing Date Balance Sheet, the Stockholder Representative shall so inform the Buyer in writing within forty-five (45) days of the Stockholder Representative’s receipt thereof, such writing to set forth the objections of the Stockholder Representative in reasonable detail (the “Dispute Notice”). Any item or amount that the Stockholder Representative does not dispute in the Dispute Notice within such forty-five (45) day period shall be final, binding and conclusive for all purposes hereunder. In the event any such Dispute Notice is timely provided, the Stockholder Representative and the Buyer shall use commercially reasonable efforts for a period of fifteen (15) days (or such longer period as they may mutually agree) to resolve any disagreements relating to the Net Working Capital as reflected on the Closing Date Balance Sheet that were disputed in the Dispute Notice. If at the end of such period the Stockholder Representative and the Buyer cannot reach agreement as to any disputed matter relating to the Net Working Capital as reflected on the Closing Date Balance Sheet, then the unresolved items and amounts thereof in dispute shall be submitted to a nationally recognized independent accounting firm, reasonably acceptable to the Stockholder Representative and the Buyer, which shall not be the independent accountants of the Stockholder Representative or the Buyer (the “Dispute Auditor”). The Dispute Auditor shall determine, based solely on the provisions of this Section 2.07 and the related definitions in this Agreement and the written presentations by the Stockholder Representative and the Buyer, and not by independent review, only those items and amounts that remain then in dispute as set forth in the Dispute Notice. The Dispute Auditor’s determination of the Net Working Capital shall be made within forty-five (45) days after the dispute is submitted for its determination and shall be set forth in a written statement delivered to the Stockholder Representative and the Buyer. The Dispute Auditor shall have exclusive jurisdiction over, and resorting to the Dispute Auditor as provided in this Section 2.07 shall be the only recourse and remedy of the parties against one another with respect to, those items and amounts that remain in dispute under this Section 2.07(e), and the Buyer shall not be entitled to seek indemnification or recovery of any attorneys’ fees or other professional fees incurred by the Buyer in connection with any dispute governed by this Section 2.07. The Dispute Auditor shall allocate its fees and expenses between the Buyer and the Stockholder Representative (on behalf of the Company Stockholders) according to the degree to which the positions of the respective parties are not accepted by the Dispute Auditor. In no event shall the decision of the Dispute Auditor assign a value to any item greater than the greatest value for such item claimed by either the Buyer or the Stockholder Representative or lesser than the smallest value for such item claimed by either the Buyer or the Stockholder Representative. Any determinations made by the Dispute Auditor pursuant to this Section 2.07 shall be final, non-appealable and binding on the parties hereto, absent manifest error or fraud.

(f) The Stockholder Representative shall be entitled to have access to the books and records of the Company and the Buyer’s work papers prepared in connection with the Closing Date Balance Sheet and shall be entitled to discuss such books and records and work papers with the Buyer and those persons responsible for the preparation thereof.

Section 2.08 Dissenting Shares. Notwithstanding anything in this Agreement to the contrary, each share of Common Stock or Preferred Stock issued and outstanding immediately prior to the Effective Time held by any Stockholder who has not voted in favor of the Merger or consented thereto in writing and has properly exercised its dissenter’s rights under Chapter 13 of the CCC (such shares, the “Dissenting Shares”) shall not be converted into or be exchangeable for the right to receive its portion of the Merger Consideration, but shall be entitled only to such rights with respect to such Dissenting Shares as may be granted to such holder pursuant to Chapter 13 of the CCC. Each holder of Dissenting Shares who, pursuant to the provisions of Chapter 13 of the CCC, becomes entitled to payment of the fair value of such shares of Common Stock or Preferred Stock shall receive payment therefor (but only after the value thereof shall have been agreed upon or finally determined pursuant to the provisions of the CCC), with interest paid thereon only to the extent required by the CCC. If a holder of any Dissenting Shares shall become entitled to receive payment of the fair value for such shares pursuant to the CCC, then Buyer shall make such payment pursuant to the CCC. If, after the Effective Time, any Dissenting Shares shall lose their status as Dissenting Shares, Buyer shall issue and deliver, upon surrender by the holder of the certificate or certificates representing such Securities, the consideration, if any, to which such Stockholder would otherwise be entitled pursuant to Section 2.04 with respect to such shares of Common Stock or Preferred Stock; provided, that unless required by a Governmental Order, in no event shall any such Stockholder receive such amounts unless and until such Stockholder has delivered his, her or its Letter of Transmittal to Buyer. Following the Closing, Buyer shall give the Stockholder Representative (a) reasonably prompt notice of any demands received by Buyer or the Surviving Corporation for appraisal of shares of Common Stock or Preferred Stock pursuant to the CCC, withdrawals of such demands and any other instruments served pursuant to the CCC and received by Buyer or the Surviving Corporation and (b) the opportunity to participate in all negotiations and proceedings with respect to such demands.

Section 2.09 Tax Withholding. Notwithstanding any provision contained herein to the contrary, the Buyer, the Company and the Surviving Corporation shall be entitled to deduct and withhold (or cause to be deducted and withheld) from the amounts otherwise payable pursuant to this Agreement, such amounts as are required to be deducted and withheld with respect to the making of such payments under the Code, or under any applicable provision of state, local or foreign tax law. To the extent amounts are so withheld and timely paid over to the appropriate Governmental Authority, the withheld amounts shall be treated for all purposes of this Agreement as having been paid to the Person in respect of which such deduction and withholding was made. If the Buyer, the Company, or the Surviving Corporation determine that any amounts are required to be deducted or withheld (other than any deduction or withholding with respect to any payments constituting compensation for services), the Buyer, the Company or the Surviving Corporation shall use commercially reasonable efforts to, prior to deducting or withholding any such amounts, notify the Person in respect of which such deduction and withholding was made and shall reasonably cooperate in good faith to establish or obtain any exemption from or reduction in the amount of any withholding that otherwise would be required.

Article III

REPRESENTATIONS AND WARRANTIES CONCERNING THE COMPANY

The Company represents and warrants to the Buyer that each statement contained in this Article III is true and correct as of the date of delivery of the Disclosure Schedule and as of the Closing, except as set forth in the schedule of exceptions that shall be delivered to the Buyer in final form at or before the Closing (the “Disclosure Schedule”) corresponding to the applicable sections of this Article III. The Disclosure Schedule shall be true, correct and complete as of the Closing. Each section of the Disclosure Schedule will be deemed to incorporate by reference all information disclosed in any other section of the Disclosure Schedule.

Section 3.01 Organization; Standing and Power; Authority and Enforceability. The Company is duly organized, validly existing and in good standing under the laws of its jurisdiction of its incorporation or organization, and has all requisite corporate power and authority, directly or indirectly, to own, lease and operate its properties and assets and to carry on its business as it is now being conducted. The Company is duly qualified or licensed as a foreign corporation to do business, and is in good standing, in each jurisdiction where the character of its properties or assets owned, leased or operated by it or the nature of its activities makes such qualification or licensing necessary, except where the failure to be so qualified or licensed would not be reasonably expected to have, individually or in the aggregate, a Material Adverse Effect. The execution, delivery and performance by the Company of this Agreement and the Ancillary Agreements and the consummation by the Company of the transactions contemplated hereby and thereby have been duly authorized by all necessary action on the part of the Company, and no other action is necessary on the part of the Company to authorize this Agreement or to consummate the Merger or the other transactions contemplated hereby. Assuming the due authorization, execution and delivery by each other party hereto, constitute a legal, valid and binding obligations of the Company, enforceable against the Company in accordance with their terms, except as limited by the Bankruptcy and Equity Exception.

Section 3.02 Subsidiaries. The Company does not have any Subsidiaries.

Section 3.03 Capitalization.

(a) The authorized capital stock of the Company consists of 12,500,000 shares of Common Stock, of which 925,106 shares are issued and outstanding and 8,200,000 shares of Preferred Stock, consisting of 2,000,000 authorized shares of Series A-2 convertible preferred stock, $0.001 par value, of which 1,933,639 shares are issued and outstanding; 3,200,000 authorized shares of Series A-1 convertible preferred stock, $0.001 par value, of which 3,175,627 shares are issued and outstanding; and 3,600,000 authorized shares of Series A convertible preferred stock, $0.001 par value, of which 3,299,640 shares are issued and outstanding.

(b) The Company has no plans or agreements pursuant to which they have granted or committed to grant any option or right to acquire stock or any other award payable in or based upon the stock or membership interests of the Company. There are no outstanding options, warrants or other securities or subscription, preemptive or other rights convertible into or exchangeable or exercisable for any stock or other equity or voting interests of the Company and there are no “phantom interest” rights, interest appreciation rights or other similar rights with respect to the Company. There are no Contracts of any kind to which the Company is a party or by which the Company is bound, obligating the Company to issue, deliver, grant or sell, or cause to be issued, delivered, granted or sold, additional stock or membership interests, or other equity or voting interests in, or options, warrants or other securities or subscription, preemptive or other rights convertible into, or exchangeable or exercisable for, stock, or other equity or voting interests in, the Company, or any “phantom interests” right, interest appreciation right or other similar right with respect to the Company, or obligating the Company to enter into any such Contract.

(c) There are no securities or other instruments or obligations of the Company, the value of which is in any way based upon or derived from any equity or voting interests of the Company or having the right to vote (or convertible into, or exchangeable or exercisable for, securities having the right to vote) on any matters on which any of the Company’s shareholders may vote.

(d) There are no Contracts, contingent or otherwise, obligating the Company to repurchase, redeem or otherwise acquire any stock of, or other equity or voting interests in, the Company. There are no voting trusts, registration rights agreements or stockholder agreements to which the Company is a party with respect to the voting of stock in the Company or with respect to the granting of registration rights for any of the stock in the Company. There are no rights plans affecting the Company.

(e) The Company has no outstanding Indebtedness.

Section 3.04 Noncontravention.

(a) Neither the execution and delivery of this Agreement nor the consummation of the Merger and the other transactions contemplated by this Agreement will (i) violate any provision of the articles of incorporation or bylaws (or comparable organization documents, as applicable) of the Company, (ii) to the Knowledge of the Company and assuming compliance with the filing and notice requirements set forth in Section 3.04(b)(i), violate any Law applicable to the Company on the date hereof or (iii) violate any Contract to which the Company is a party, except in the case of clauses (ii) and (iii) to the extent that any such violation would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.

(b) The execution and delivery of this Agreement by the Company does not, and the performance of this Agreement by the Company will not, require any consent, approval, authorization or Permit of, or filing with or notification to, any Governmental Entity, except (i) for the consents and filings set forth in Section 3.04 of the Disclosure Schedule or (ii) where the failure to take such action would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.

Section 3.05 Financial Statements. Section 3.05 of the Disclosure Schedule contains true and complete copies of (i) the unaudited balance sheet of the Company as of December 31, 2021 and December 31, 2020 and the related unaudited combined statements of income, stockholders’ equity and cash flows for the years ended December 31, 2021 and December 31, 2020 (the “Annual Financial Statements”) and (ii) the unaudited combined balance sheet of the Company as of September 30, 2022 and the related statements of income, stockholders’ equity and cash flows for the nine month period ended September 30, 2022 (the “Interim Financial Statements” and, together with the Annual Financial Statements, the “Financial Statements”). The Financial Statements fairly present, in all material respects, the financial condition and results of operations of the Company as of the indicated dates and for the indicated periods (subject to normal year-end adjustments and the absence of notes).

Section 3.06 Taxes.

(a) All material Tax Returns required to have been filed by the Company have been filed, and each such Tax Return reflects the liability for Taxes in all material respects. All Taxes shown on such Tax Returns as due have been paid or accrued.

(b) To the Knowledge of the Company, there is no audit pending against the Company in respect of any Taxes. There are no Liens on any of the assets of the Company that arose in connection with any failure (or alleged failure) to pay any Tax, other than Liens for Taxes not yet due and payable.

(c) The Company has withheld and paid or accrued for all material Taxes required to have been withheld and paid or accrued for in connection with amounts paid or owing to any third party.

(d) The Company has not waived any statute of limitations in respect of Taxes or agreed to any extension of time with respect to a Tax assessment or deficiency.

(e) The Company is not a party to any Tax allocation or sharing agreement.

Section 3.07 Compliance with Laws and Orders; Permits.

(a) To the Knowledge of the Company, the Company is in compliance with all Laws and Orders to which the business of the Company is subject, except where such failure to comply would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.

(b) To the Knowledge of the Company, the Company owns, holds, possesses, or lawfully uses in the operation of its business all Permits that are necessary for it to conduct its business as now conducted, except where such failure to own, hold, possess or lawfully use such Permit would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.

Section 3.08 No Undisclosed Liabilities. The Company does not have any Liabilities, except for (a) Liabilities set forth in the Interim Financial Statements, (b) Liabilities which have arisen since the date of the Interim Financial Statements in the ordinary course of business, (c) Liabilities arising in connection with the Merger or the transactions contemplated thereby, (d) Liabilities to be included in the computation of Indebtedness or Transaction Expenses as of the Closing, and (e) Liabilities to be included in the computation of Net Working Capital.

Section 3.09 Tangible Personal Assets.

(a) Except as set forth in Section 3.09 of the Disclosure Schedule, the Company has good title to, or a valid interest in, all of its tangible personal assets, free and clear of all Liens, except for Permitted Liens.

(b) The Company’s tangible personal assets are in operating condition and working order and repair, when taken as a whole, subject to ordinary wear and tear and repairs from time to time in the ordinary course of business and are suitable for the purposes for which they are currently being used.

Section 3.10 Real Property. The Company does not own any real property. Section 3.10 of the Disclosure Schedule contains a list of all leases and subleases (collectively, the “Real Property Leases”) under which the Company is either lessor or lessee. The Company has made available to the Buyer true and complete copies of each Real Property Lease. To the Knowledge of the Company, (a) all Real Property Leases are valid and binding Contracts of the Company and are in full force and effect (except for those that have terminated or will terminate by their own terms), and (b) no party to any Real Property Lease is in violation or breach of or default (or with notice or lapse of time, or both, would be in violation or breach of or default) under the terms of any Real Property Lease, in each case, except where such default would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.

Section 3.11 Intellectual Property.

(a) Section 3.11 of the Disclosure Schedule sets forth a list that includes all material Intellectual Property owned by the Company that is registered or subject to an application for registration (the “Company-Owned Intellectual Property”) (including the jurisdictions where such Company-Owned Intellectual Property is registered or where applications have been filed, and all registration or application numbers, as appropriate).

(b) All necessary registration, maintenance and renewal fees have been paid and all necessary documents have been filed with the United States Patent and Trademark Office or foreign patent and trademark office in the relevant foreign jurisdiction for the purposes of maintaining the registered Company-Owned Intellectual Property.

(c) (i) The Company is the exclusive owner of the Company-Owned Intellectual Property free and clear of all Liens (other than Permitted Liens); (ii) to the Knowledge of the Company, no proceedings have been instituted, are pending or are threatened that challenge the rights of the Company in or the validity or enforceability of the Company-Owned Intellectual Property; (iii) to the Knowledge of the Company, neither the use of the Company-Owned Intellectual Property as currently used by the Company in the conduct of the Company’s business, nor the conduct of the business as presently conducted by the Company infringes, dilutes, misappropriates or otherwise violates in any material respect the Intellectual Property rights of any Person; and (iv) as of the date of this Agreement, the Company has not made any claim of a violation, infringement, misuse or misappropriation by any Person, of their rights to, or in connection with, the Company-Owned Intellectual Property.

(d) The Company has not permitted or granted a license to any Person to use any Company-Owned Intellectual Property.

(e) Section 3.11 of the Disclosure Schedule sets forth a true and complete list of all licenses, other than “off the shelf” commercially available software programs, pursuant to which the Company has been granted a license to use Intellectual Property that is material to and used in the conduct of the business by the Company.

(f) To the Knowledge of the Company, the Company is not in default in the performance, observance or fulfillment of any obligation, covenant or condition contained in any Contract pursuant to which any third party is authorized to use any Company-Owned Intellectual Property or pursuant to which the Company is licensed to use Intellectual Property owned by a third party, except where such default would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.

Section 3.12 Absence of Certain Changes or Events.

(a) Since the date of the Interim Financial Statements, no event has occurred that has had, individually or in the aggregate, a Material Adverse Effect. Without limiting the generality of the foregoing, since the date of the Interim Financial Statements:

(i) the Company has not sold, leased, transferred, or assigned any of its assets, tangible or intangible, other than in the ordinary course of business;

(ii) the Company has not entered into any agreement, contract, lease, or license (or series of related agreements, contracts, leases, and licenses) either involving more than $25,000 or outside the ordinary course of business;

(iii) no party (including the Company) has accelerated, terminated, modified, or cancelled any agreement, contract, lease, or license (or series of related agreements, contracts, leases, and licenses) involving more than $25,000 to which the Company is a party or by which it is bound;

(iv) the Company has not imposed any Liens upon any of its assets, tangible or intangible;

(v) the Company has not made any capital expenditure (or series of related capital expenditures) outside the ordinary course of business;

(vi) the Company has not made any capital investment in, any loan to, or any acquisition of the securities or assets of, any other Person (or series of related capital investments, loans, and acquisitions) outside the ordinary course of business;

(vii) the Company has not transferred, assigned, or granted any license or sublicense of any rights under or with respect to any Intellectual Property;

(viii) there has been no change made or authorized in the articles of incorporation or bylaws (or comparable documents) of the Company;

(ix) the Company has not issued, sold, or otherwise disposed of any of its stock, or granted any options, warrants, or other rights to purchase or obtain (including upon conversion, exchange, or exercise) any of its stock;

(x) the Company has not made any loan to, or entered into any other transaction with, any of its directors, officers, and employees outside the ordinary course of business;

(xi) the Company has not entered into any employment contract or modified the terms of any existing such contract or agreement;

(xii) the Company has not granted any increase in the base compensation of any of its directors, officers, and employees outside the ordinary course of business; and

(xiii) the Company has not committed in writing to do any of the foregoing.

Section 3.13 Contracts.

(a) As of the date hereof, the Company is not a party to or bound by any: (i) Contract not contemplated by this Agreement that materially limits the ability of the Company to engage or compete in any manner of the business presently conducted by the Company; (ii) Contract that creates a partnership or joint venture or similar arrangement with respect to any material business of the Company; (iii) indenture, credit agreement, loan agreement, security agreement, guarantee, note, mortgage or other evidence of indebtedness or agreement providing for Indebtedness in excess of $25,000; (iv) Contract that relates to the acquisition or disposition of any material business (whether by merger, sale of equity, sale of assets or otherwise) other than this Agreement; or (v) Contract that involves performance of services or delivery of goods or materials by or to the Company in an amount or with a value in excess of $25,000 in the calendar year 2022.

(b) The Company has made available to the Buyer true and complete copies of each of the Contracts set forth in Section 3.13(b) of the Disclosure Schedule. To the Knowledge of the Company, (i) all such Contracts are valid and binding, (ii) all such Contracts are in full force and effect (except for those that have terminated or will terminate by their own terms), and (iii) neither the Company nor any other party thereto, is in violation or breach of or default under (or with notice or lapse of time, or both, would be in violation or breach of or default under) the terms of any such Contract, in each case, except where such default would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.

Section 3.14 Litigation. Section 3.14 of the Disclosure Schedule sets forth each instance in which the Company (i) is subject to any outstanding injunction, judgment, order, decree, ruling, or charge or (ii) is a party to, or to the Knowledge of the Company is threatened to be made a party to, any action, suit, proceeding, hearing, or investigation of, in, or before any court or quasi-judicial or administrative agency of any federal, state, local, or foreign jurisdiction or before any arbitrator. None of the Actions set forth in Section 3.14 of the Disclosure Schedule could result in a Material Adverse Effect. None of the Company, the Company nor the directors and officers of the Company has any reason to believe that any such action, suit, proceeding, hearing, or investigation may be brought or threatened against the Company.

Section 3.15 Employee Benefits.

(a) Section 3.15 of the Disclosure Schedule sets forth a list of all Benefit Plans maintained or contributed to by the Company (the “Company Benefit Plans”). The Company has delivered or made available to the Buyer copies of (i) the Company Benefit Plans, (ii) the most recent summary plan description for the Company Benefit Plans for which such a summary plan description is required and (iii) the most recent favorable determination letters from the IRS with respect to the Company Benefit Plans intended to qualify under Section 401(a) of the Code or, with respect to a prototype or volume submitter plan, the most recent opinion letter from the IRS to the prototype plan or volume submitter plan sponsor.

(b) (i) None of the Company Benefit Plans is subject to Title IV of ERISA; (ii) each Company Benefit Plan that is intended to be qualified under Section 401(a) of the Code is subject to a favorable determination letter from the IRS or, with respect to a prototype or volume submitter plan, can rely on an opinion letter from the IRS to the prototype plan or volume submitter plan sponsor, to the effect that such Company Benefit Plan is so qualified and, to the Knowledge of the Company, no event has occurred and no condition exists that is reasonably likely to result in the revocation of any such determination; and (iii) each Company Benefit Plan is in compliance with all applicable provisions of ERISA and the Code, except for instances of noncompliance that would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.

(c) Neither the execution or delivery of this Agreement nor the consummation of the transactions contemplated by this Agreement could reasonably be expected to, either alone or in conjunction with any other event (whether contingent or otherwise), (i) result in any payment or benefit becoming due or payable, or required to be provided, to any current or former director, employee or independent contractor of the Company, (ii) increase the amount or value of any benefit or compensation otherwise payable or required to be provided to any such current or former director, employee or independent contractor, or result in the acceleration of the time of payment, vesting or funding of any such benefit or compensation or (iii) result in any amount failing to be deductible by reason of Section 280G of the Code.

Section 3.16 Labor and Employment Matters. Section 3.16 of the Disclosure Schedule sets forth a list of all written employment agreements that obligate the Company to pay an annual salary of $100,000 or more and to which the Company is a party. To the Knowledge of the Company, there are no pending labor disputes, work stoppages, requests for representation, pickets, work slow-downs due to labor disagreements or any actions or arbitrations that involve the labor or employment relations of the Company. The Company is not a party to any collective bargaining agreement. The Company is in material compliance with all foreign, federal and state laws respecting employment and employment practices, terms and conditions of employment, wages and hours and nondiscrimination in employment, and are not engaged in any unfair labor practice. There is no charge pending or, to the Knowledge of the Company, threatened against the Company alleging unlawful discrimination in employment practices before any court or agency and there is no charge of or proceeding with regard to any unfair labor practice against the Company pending before the National Labor Relations Board or any similar entity. The Company is in material compliance with all laws (i) with respect to classification of independent contractors and (ii) with respect to classification of employees as “exempt” or “nonexempt” from overtime requirements under applicable law.

Section 3.17 Environmental Matters. Except for any matter that would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect, to the Knowledge of the Company, (i) the Company is in compliance with all applicable Laws relating to protection of the environment (“Environmental Laws”), (ii) the Company possesses and is in compliance with all Permits required under any Environmental Law for the conduct of its operations and (iii) there are no Actions pending against the Company alleging a violation of any Environmental Laws.

Section 3.18 Insurance. Section 3.18 of the Disclosure Schedule sets forth a list of each insurance policy that covers the Company or its business, properties, assets, directors, officers or employees. Such insurance policies (a) are in full force and effect in all material respects and the Company is not in violation or breach of or default under any of its obligations under any such insurance policy, except where such default would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect, (b) are sufficient for compliance in all material respects by the Company with all requirements of Law and of all agreements to which the Company is a party, and (c) are valid, outstanding and enforceable policies.

Section 3.19 Brokers’ Fees. The Company has no Liability to pay any fees or commissions to any broker, finder or agent with respect to this Agreement, the Merger or the transactions contemplated by this Agreement.

Section 3.20 Certain Business Relationships with the Company. No Seller, nor any Affiliate of any Seller, has been involved in any business arrangement or relationship with the Company within the past 12 months that involves more than $25,000, and no Seller, nor any Affiliate of any Seller, owns any material asset, tangible or intangible, which is used in the business of the Company.

Section 3.21 Equipment. Section 3.21 of the Disclosure Schedule sets forth a true and complete list of all plants, fixtures, machinery, installations, equipment, furniture, tools, spare parts, supplies, materials and other personal property (collectively, the “Equipment”) owned by the Company other than items having a net book or market value individually of less than $100,000 or expensed for tax purposes, as of the date of the Interim Financial Statements, and the Company has not acquired any Equipment in excess of such amount since such date. The Equipment, and all personal property held by the Company, are utilized by the Company in the ordinary course of business.

Section 3.22 Suppliers. Section 3.22 of the Disclosure Schedule sets forth a true and complete list of the top 10 suppliers of the Company during the fiscal year ended December 31, 2021 and indicates with respect to each the name and dollar volume of business with the Company (including the primary categories, based on purchases or sales, of products or services bought or sold). The Company is not required to provide any material bonding or other financial security arrangements in connection with its transactions with any supplier required to be disclosed on Section 3.22 of the Disclosure Schedule except as set forth therein. To the Knowledge of the Company, since the date of the Annual Financial Statements, no supplier required to be disclosed on Section 3.22 of the Disclosure Schedule has terminated its relationship with, or materially reduced its sales to, the Company.

Section 3.23 Inventory. All Inventory is owned by the Company, and all such inventory consists of a quality and quantity usable and salable in the ordinary course of business at customary gross margins, except for any inventory that is obsolete, discontinued, damaged, or of below standard quality or merchantability that has been written down to realizable fair market value on the Financial Statements. None of such inventory is obsolete, discontinued, damaged, overage, or of below standard quality or merchantability, except for items that have been written down to realizable market value on the Financial Statements. Each item of such inventory is reflected in the books and records of the Company on the basis of a complete physical count and is valued at the lower of cost, on a first-in, first-out basis, or market.

Section 3.24 Officers and Directors; Bank Accounts, Signing Authority, Powers of Attorney. Section 3.24 of the Disclosure Schedule lists all officers and directors (or equivalent governing positions) of the Company. Except as set forth in Section 3.24 of the Disclosure Schedule, the Company does not have an account or safe deposit box in any bank and no Person has any power, whether solely or jointly, to sign any checks on behalf of the Company, to withdraw any money or other property from any bank, brokerage or other account of the Company or to act under any power of attorney granted by the Company at any time for any such purpose. Section 3.24 of the Disclosure Schedule also sets forth the names of all Persons authorized to borrow money or sign notes on behalf of the Company.

Section 3.25 Accounts Receivable. Except as set forth in Section 3.25 of the Disclosure Schedule, all Accounts Receivable arose in the ordinary course of the business and represent or will represent valid obligations due. None of the Accounts Receivable is more than thirty (30) days past due.

Section 3.26 No Other Representations. Except for the representations and warranties contained in Article III, any Ancillary Agreement or any certificate delivered hereunder, neither the Company nor any other Person makes any other representation or warranty, express or implied, at law or in equity, in respect of the Company, or the business and operations or the assets of the Company.

Article IV
REPRESENTATIONS AND WARRANTIES OF BUYER AND MERGER SUB

The Buyer and Merger Sub, jointly and severally, represent and warrant to the Company that each statement contained in this Article IV is true and correct as of the date hereof and as of the Closing Date.

Section 4.01 Organization. Each of the Buyer and Merger Sub is a corporation duly organized, validly existing and in good standing under the Laws of the State of Delaware.

Section 4.02 Authorization. Each of the Buyer and Merger Sub the requisite power and authority to execute and deliver this Agreement and the Ancillary Agreements, to perform its obligations hereunder and thereunder and to consummate the transactions contemplated hereby and thereby. The execution, delivery and performance by each of the Buyer and Merger Sub of this Agreement and the Ancillary Agreements and the consummation by each of the Buyer and Merger Sub of the transactions contemplated hereby and thereby have been duly authorized by all necessary action on the part of each of the Buyer and Merger Sub, respectively, and no other action is necessary on the part of the Buyer or Merger Sub to authorize this Agreement or the Ancillary Agreements or to consummate the Merger or the other transactions contemplated hereby or thereby. This Agreement has been, and the Ancillary Agreements upon execution will be, duly executed and delivered by the Buyer and Merger Sub and, assuming the due authorization, execution and delivery by each other party hereto, constitute legal, valid and binding obligations of the Buyer, enforceable against the Buyer and Merger Sub in accordance with their terms, except as limited by the Bankruptcy and Equity Exception.

Section 4.03 Noncontravention.

(a) Neither the execution and the delivery of this Agreement or any Ancillary Agreement, nor the consummation of the Merger and the other transactions contemplated by this Agreement or any Ancillary Agreement, will, with or without the giving of notice or the lapse of time or both, (i) violate any provision of the certificate of incorporation or bylaws of the Buyer or Merger Sub, (ii) violate any Law applicable to the Buyer or Merger Sub on the date hereof or (iii) violate any Contract to which the Buyer or Merger Sub is a party, except in the case of clauses (ii) and (iii) to the extent that any such violation would not reasonably be expected to prevent or materially delay the consummation of the Merger and the other transactions contemplated by this Agreement or any Ancillary Agreement.

(b) The execution and delivery of this Agreement or any Ancillary Agreement by the Buyer and Merger Sub does not, and the performance of this Agreement by the Buyer and Merger Sub will not, require any consent, approval, authorization or Permit of, or filing with or notification to, any Governmental Entity, except (i) for post-closing securities filings or notifications required to be made under federal securities laws, or (ii) where the failure to take such action would not reasonably be expected to have, individually or in the aggregate, a material adverse effect on the assets, properties, condition (financial or otherwise), operations of the Buyer and any of its Subsidiaries, taken as a whole.

Section 4.04 Litigation. There are no Actions pending or, to the knowledge of Buyer and Merger Sub, threatened against Buyer or Merger Sub that could reasonably be expected to have, individually or in the aggregate, a material adverse effect on the assets, properties, condition (financial or otherwise), operations of the Buyer, Merger Sub and any of their Subsidiaries, taken as a whole. None of Buyer, Merger Sub nor the directors and officers of Buyer has any reason to believe that any such action, suit, proceeding, hearing, or investigation may be brought or threatened against Buyer or Merger Sub

Section 4.05 Investment Intent.

(a) To the knowledge of Buyer, Buyer has received all information that it deems necessary for making an investment decision regarding the purchase of the Securities. Buyer has evaluated the risks of purchasing the Securities. Buyer possesses such knowledge and experience in financial and business matters that renders Buyer capable of evaluating the merits and risks of an investment of this type. Buyer has determined that its investment in the Securities is suitable for it in light of its financial situation and needs. Buyer has adequate financial resources for an investment of this character. Buyer has no need for liquidity of its investment in the Securities to satisfy any existing or contemplated undertaking or indebtedness. Buyer is able to bear the economic risk of its investment in the Securities for an indefinite period of time. Buyer has sufficient net worth to sustain a loss of its entire investment in the Securities.

(b) Buyer is acquiring the Securities for (i) itself and not for any other Person and (ii) for investment purposes only and not with a view for distribution to any other Person. Buyer has no arrangement with any Person to assign or pledge any part or all of the Securities that it is purchasing.

(c) Buyer understands that the Securities will not be registered under the Securities Act of 1933 (the “Act”), in reliance on Section 4(1) and/or Section 4(2) of the Act and/or the applicable provisions of Regulation D promulgated thereunder (“Regulation D”), if applicable. Buyer understands that the Company does not have any obligation or intention of registering the Securities under any federal or state securities laws. Buyer understands that no federal or state agency has made any finding, determination, recommendation and/or endorsement of the Securities.

(d) Buyer agrees that the Securities may not be sold, transferred, assigned, pledged or hypothecated unless such Securities are registered or exempt from registration under the federal securities laws and all applicable state securities laws.

(e) Buyer certifies that it is an “accredited investor” as that term is defined in Regulation D.

(f) Buyer understands that the Company and the Majority Stockholders are relying on the information it has provided under this for purposes of establishing exemptions from registration under applicable securities laws.

Section 4.06 Financial Condition; Solvency. At the Closing, Buyer will have available funds necessary to pay the Cash Portion of the Merger Consideration in full. Immediately after giving effect to Buyer’s payment of the Cash Portion of the Merger Consideration in full and the consummation of the other transactions contemplated by this Agreement and the Ancillary Agreements, Buyer shall be solvent, be able to pay its debts as they become due, own property that has a fair saleable value greater than the amounts required to pay its debts (including a reasonable estimate of the amount of all contingent liabilities), and have adequate capital to carry on its business.

Section 4.07 Forward-Looking Statements. Notwithstanding anything contained in this Agreement or any other Ancillary Agreement to the contrary, each of Buyer and Merger Sub acknowledges and agrees that none of the Majority Stockholders or the Company, nor any other Person, have made or are making any representations or warranties of any kind or nature whatsoever, express or implied, concerning or as to the accuracy or completeness of any projections, budgets, forecasts or other forward-looking financial information concerning the future revenue, income, profit or other financial results of the Company or the Business. Without limiting the generality of the foregoing, Buyer acknowledges that there are uncertainties inherent in attempting to make any such projections, budgets, forecasts or other forward-looking financial information and actual results of operations may differ materially from any such projections, budgets, forecasts or other forward-looking financial information.

Section 4.08 No Other Representations. Except for the representations and warranties contained in Article IV, any Ancillary Agreement or any certificate delivered hereunder, neither Buyer nor any other Person makes any other representation or warranty, express or implied, at law or in equity, in respect of Buyer, or the business and operations or the assets of Buyer.

Section 4.09 Non Reliance. Buyer has conducted its own independent investigation, review and analysis of the business, results of operations, prospects, condition (financial or otherwise) or assets of the Company, and acknowledges that it has been provided adequate access to the personnel, properties, assets, premises, books and records, and other documents and data of the Company for such purpose. Buyer acknowledges and agrees that: (i) in making its decision to enter into this Agreement and the other Ancillary Agreements and to consummate the transactions contemplated thereby and hereby, Buyer has relied solely upon its own investigation and the express representations and warranties of the Company set forth in Article III of this Agreement (including, and subject to, the related portions of the Disclosure Schedules) and disclaims reliance on any other representations and warranties of any kind or nature express or implied (including any relating to the future or historical financial condition, results of operations, assets or liabilities or prospects of the Company); and (ii) none of the Company or any other Person has made any representation or warranty as to the Company or the accuracy or completeness of any information regarding the Company furnished or made available to Buyer and its representatives, except as expressly set forth in Article III of this Agreement (including, and subject to, the related portions of the Disclosure Schedules).

Section 4.10 Brokers’ Fees. The Buyer has no Liability to pay any fees or commissions to any broker, finder or agent with respect to this Agreement, the Merger or the transactions contemplated by this Agreement that could result in any Liability being imposed on the Company.

Article V
COVENANTS; ADDITIONAL AGREEMENTS

Section 5.01 Consents. The Company will use its commercially reasonable efforts to obtain any required third-party consents to the Merger and the other transactions contemplated by this Agreement in writing from each Person.

Section 5.02 Operation of the Company’s Business. During the period commencing on the date hereof and ending at the earlier of the Closing and the termination of this Agreement in accordance with Article VII, the Company, except (i) as otherwise contemplated by this Agreement, (ii) as required by applicable Law or (iii) with the prior written consent of Buyer (which consent will not be unreasonably withheld, conditioned or delayed), shall:

(a) use commercially reasonable efforts to carry on its business in a manner consistent with past practice and refrain from extraordinary transactions;

(b) maintain the properties and other assets of the Company in good working order (normal wear excepted); and

(c) use the Company’s commercially reasonable efforts to maintain its business and employees, customers, assets and operations as a going concern and in accordance with past practice.

Section 5.03 Access. During the period commencing on the date hereof and ending at the earlier of the Closing and the termination of this Agreement in accordance with Article VII, the Company will provide reasonable access to the Company’s financial, accounting, business records, contracts and other legal documents maintained by the Company for the purpose of the Buyer completing its due diligence investigation. The parties hereto will cooperate to complete due diligence in a reasonably expeditious timeframe.

Section 5.04 Transfer of Cash and Cash Equivalents; Transfer of Certain Assets. On or prior to the Closing, the Company will use commercially reasonable efforts to transfer or cause to be distributed all cash and cash equivalents of the Company, to, among other things, pay any fees owed by Company to brokers or advisors, to repay any Indebtedness and to distribute cash to the Majority Stockholders.

Section 5.05 Notice of Developments. The Majority Stockholders and the Company will give prompt written notice to the Buyer of any event that would reasonably be expected to give rise to, individually or in the aggregate, a Material Adverse Effect or would reasonably be expected to cause a breach of any of their respective representations, warranties, covenants or other agreements contained herein. The Buyer will give prompt written notice to the Majority Stockholders and the Company of any event that could reasonably be expected to cause a breach of any of its representations, warranties, covenants or other agreements contained herein or could reasonably be expected to, individually or in the aggregate, prevent or materially delay the consummation of the Merger and the other transactions contemplated by this Agreement. The delivery of any notice pursuant to this Section 5.05 will not limit, expand or otherwise affect the remedies available hereunder (if any) to the party receiving such notice.

Section 5.06 No Solicitation.

(a) The Majority Stockholders and the Company will, and will cause each of their Representatives to, cease immediately any existing discussions regarding a Transaction Proposal.

(b) During the period commencing on the date hereof and ending at the earlier of the Closing and the termination of this Agreement in accordance with Article VII, without the prior consent of the Buyer, the Company will not, nor will it authorize or permit any of its Representatives, including, without limitation, the Majority Stockholders to, directly or indirectly through another Person to, (i) solicit, initiate or encourage (including by way of furnishing information), or take any other action designed to facilitate any inquiries, proposals or offers from any Person that constitute, or would reasonably be expected to constitute, a Transaction Proposal, (ii) participate in any discussions or negotiations (including by way of furnishing information) regarding any Transaction Proposal or (iii) otherwise cooperate in any way with, or assist or participate in, facilitate or encourage, any effort or attempt by any other Person to do or seek any of the foregoing. The Company shall immediately communicate to the Buyer the terms of any Transaction Proposal received by the Company, or any of their Representatives.

Section 5.07 Joinder Agreements. The Company shall use commercially reasonable efforts to cause each Majority Stockholder to execute and deliver to the Buyer on or prior to the Closing Date a joinder agreement, in a form reasonably satisfactory to the Buyer, the Company and the Majority Stockholders (each such agreement, a “Joinder Agreement”).

Section 5.08 Financial Information. The Company shall reasonably cooperate with the Buyer and the Buyer’s independent certified public accounting firm, in order to enable the Buyer to create audited financial statements prepared in accordance with GAAP for the two full fiscal years preceding the Closing Date and unaudited financial statements prepared in accordance with GAAP for any interim periods by making available the Company’ records as they are maintained in the ordinary course of business and answering reasonable questions.

Section 5.09 Taking of Necessary Action; Further Action. Subject to the terms and conditions of this Agreement, the Company, the Company and Buyer will take all such reasonable and lawful action as may be necessary or appropriate in order to effectuate the Merger in accordance with this Agreement as promptly as practicable.

Section 5.10 Confidentiality. Reference is made to that certain Non-Disclosure Agreement by and among the parties hereto (the “Confidentiality Agreement”). Effective upon the Closing, the Confidentiality Agreement will terminate; provided, however, that prior to the Closing, in addition to the exclusions already set forth in the Confidentiality Agreement, “Confidential Information” as defined in the Confidentiality Agreement shall not include information which is disclosed by the Buyer or its Affiliates pursuant to Applicable Law, the Securities Exchange Act of 1934. From and after the Closing the Stockholder Representative will treat and hold as confidential, refrain from using any of the Confidential Information (as defined in the Confidentiality Agreement) except in connection with this Agreement, deliver promptly to the Buyer or destroy, at the request and option of the Buyer, all tangible embodiments (and all copies) of the Confidential Information which are in the Stockholder Representative’s possession. In the event that the Stockholder Representative is requested or required (by oral question or request for information or documents in any legal proceeding, interrogatory, subpoena, civil investigative demand, or similar process) to disclose any Confidential Information, the Stockholder Representative will notify the Buyer promptly of the request or requirement so that the Buyer may seek (at Buyer’s sole expense) an appropriate protective order or waive compliance with the provisions of this Section. If, in the absence of a protective order or the receipt of a waiver hereunder, the Stockholder Representative is, on the advice of counsel, compelled to disclose any Confidential Information to any tribunal or else stand liable for contempt, that the Stockholder Representative may disclose the Confidential Information to the tribunal; provided, however, that the Stockholder Representative shall use its commercially reasonable efforts to obtain, at the request of the Buyer and at Buyer’s sole expense, an order or other assurance that confidential treatment will be accorded to such portion of the Confidential Information required to be disclosed as the Buyer shall designate. The foregoing provisions shall not apply to any Confidential Information which is generally available to the public immediately prior to the time of disclosure.

Section 5.11 Terminated Agreements. Prior to the Closing, the Company shall cause each of the Contracts set forth on Schedule 2 attached hereto (the “Terminated Agreements”) to be terminated, effective as of and contingent upon the Closing, including by sending all required notices, such that each such Contract shall be of no further force or effect immediately following the Effective Time.

Article VI
CONDITIONS TO OBLIGATIONS TO CLOSE

Section 6.01 Conditions to Obligation of the Buyer. The obligation of the Buyer to consummate the Merger is subject to the satisfaction by the Company, or the waiver by the Buyer, of the following conditions:

(a) The Company shall have obtained from its Stockholders approval of the Merger, this Agreement and all of the transaction contemplated hereby in accordance with applicable Law and the organizational documents of the Company.

(b) The representations and warranties of the Company set forth in this Agreement will be true and correct in all respects as of the Closing Date (except to the extent such representations and warranties speak as of another date, in which case such representations and warranties will be true and correct as of such other date), except where the failure of such representations and warranties to be so true and correct (without giving effect to any limitation as to “materiality” or “Material Adverse Effect” set forth therein) does not have, and would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.

(c) The Company will have performed all covenants required to be performed by it under this Agreement at or prior to the Closing, except where the failure to perform does not have, and would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect or materially adversely affect the ability of the Company to consummate the Merger or perform its other obligations hereunder.

(d) The Buyer shall have completed its business, accounting and legal due diligence review of the Company and the Business, their assets and liabilities, and the results thereof shall be reasonably satisfactory to the Buyer.

(e) There shall not have been any occurrence, event, incident, action, failure to act, or transaction since the date of this Agreement, which has had or is reasonably likely to cause a Material Adverse Effect.

(f) All applicable waiting periods (and any extensions thereof) will have expired or otherwise been terminated, and the parties hereto will have received all other authorizations, consents and approvals of all Governmental Entities in connection with the execution, delivery and performance of this Agreement and the transactions contemplated hereby.

(g) No temporary, preliminary or permanent restraining Order preventing the consummation of the Merger will be in effect.

(h) The Company shall have delivered evidence reasonably satisfactory to the Buyer of the Company’s organization and proceedings and its existence in the jurisdiction in which it is formed, including evidence of such existence as of the Closing.

(i) The Company shall have delivered to the Buyer the Disclosure Schedules in final form updated through and as of the date of the Closing in a form reasonably satisfactory to the Buyer.

(j) The Company shall have delivered to the Buyer a certificate of the Company, executed by an officer of the Company, dated as of the Closing Date, certifying on behalf of the Company that the conditions set forth in have been satisfied in all material respects.

(k) The Company shall have delivered to Buyer the final version of Schedule 1.

(l) The Buyer shall have received from each Majority Stockholder a duly executed Joinder Agreement.

(m) Each Stockholder receiving consideration as set forth on Schedule 1 shall have duly executed the Stockholders Subordinated Notes in a form reasonably acceptable to the Buyer and the Company.

Section 6.02 Conditions to Obligation of the Company. The obligation of the Company to consummate the Merger is subject to the satisfaction by the Buyer, or the waiver by the Company, of the following conditions:

(a) The representations and warranties of the Buyer set forth in this Agreement will be true and correct in all respects as of the date of this Agreement and as of the Closing Date (except to the extent such representations and warranties speak as of another date, in which case such representations and warranties will be true and correct as of such other date), except where the failure of such representations and warranties to be so true and correct does not adversely affect the ability of the Buyer to consummate the Merger and the other transactions contemplated by this Agreement.

(b) The Buyer will have performed all of the covenants required to be performed by it under this Agreement at or prior to the Closing except such failures to perform as do not materially adversely affect the ability of the Buyer to consummate the Merger and the other transactions contemplated by this Agreement.

(c) The parties hereto will have received all other authorizations, consents and approvals of all Governmental Entities in connection with the execution, delivery and performance of this Agreement and the transactions contemplated hereby.

(d) No temporary, preliminary or permanent restraining Order preventing the consummation of the Merger will be in effect.

(e) The Buyer shall have obtained any consents, permits, licenses, approvals or notifications of any Governmental Entities, lenders, lessors, suppliers, customers or other third parties required to consummate the Merger.

(f) The Buyer shall have delivered to the Company a certificate of the Buyer, executed by an officer of the Buyer, dated as of the Closing Date, certifying on behalf of the Buyer that each of the conditions set forth in Section 6.01(a) and Section 6.01(b) have been satisfied in all material respects.

(g) Each Stockholder receiving consideration as set forth on Schedule 1 shall have duly executed the Stockholders Subordinated Notes in a form reasonably acceptable to the Buyer and the Company.

Article VII
TERMINATION; AMENDMENT; WAIVER

Section 7.01 Termination of Agreement. This Agreement may be terminated as follows:

(a) by mutual written consent of the Buyer and the Company at any time prior to the Closing;

(b) by either the Buyer or the Company if any Governmental Entity will have issued an Order or taken any other action permanently enjoining, restraining or otherwise prohibiting the transactions contemplated by this Agreement;

(c) by either the Buyer or the Company if the Closing does not occur on or before the 30^th day following the date hereof; provided that the right to terminate this Agreement under this Section 7.01(c) will not be available to any party whose breach of any provision of this Agreement results in the failure of the Closing to occur by such time;

(d) by the Buyer if Company or the Company has breached its respective representations and warranties or any covenant or other agreement to be performed by it in a manner such that the Closing conditions set forth in Section 6.01(a) or 6.01(b) would not be satisfied; or

(e) by the Company if the Buyer has breached its representations and warranties or any covenant or other agreement to be performed by it in a manner such that the Closing conditions set forth in Section 6.02(a) or 6.02(b) would not be satisfied.

Section 7.02 Effect of Termination. In the event of termination of this Agreement as provided in Section 7.01, this Agreement will terminate and all rights and obligations of the parties under this Agreement shall automatically end without any Liability (other than with respect to any suit for breach of Sections 5.06 (No Solicitation) and 5.10 (Confidentiality) of this Agreement) on the part of the Buyer, the Company or the Stockholder Representative (or any member, stockholder agent, consultant or Representative of any such party); provided, that the provisions of Section 5.10, Sections 9.01 through 9.14 and this Section 7.02 will survive any termination hereof pursuant to Section 7.01.

Section 7.03 Amendments. This Agreement may not be amended except by an instrument in writing signed on behalf of the Buyer, Merger Sub, the Company and the Stockholder Representative.

Section 7.04 Waiver. At any time prior to the Closing, the Buyer may (a) extend the time for the performance of any of the covenants, obligations or other acts of the Company or (b) waive any inaccuracy of any representations or warranties or compliance with any of the agreements, covenants or conditions of the Company. Any agreement on the part of the Buyer to any such extension or waiver will be valid only if such waiver is set forth in an instrument in writing signed on its behalf by its duly authorized officer. At any time prior to the Closing, the Company may (a) extend the time for the performance of any of the covenants, obligations or other acts of the Buyer or (b) waive any inaccuracy of any representations or warranties or compliance with any of the agreements, covenants or conditions of the Buyer. Any agreement on the part of the Company to any such extension or waiver will be valid only if such waiver is set forth in an instrument in writing signed by the Company. Except for any waiver under the preceding sentences of this Section 7.04, the failure of any party to this Agreement to assert any of its rights under this Agreement or otherwise will not constitute a waiver of such rights. The waiver of any such right with respect to particular facts and other circumstances will not be deemed a waiver with respect to any other facts and circumstances, and each such right will be deemed an ongoing right that may be asserted at any time and from time to time.

Article VIII
INDEMNIFICATION

Section 8.01 Survival. The representations and warranties made herein and in any certificate delivered in connection herewith shall survive until the earlier of (i) the date that is twelve (12) months following the Closing Date, at which time they shall expire; provided, however, that (a) the representations and warranties set forth in Sections 3.01 (Organization; Standing and Power; Authority and Enforceability), 3.03 (Capitalization), 3.06 (Taxes), and 3.19 (Brokers’ Fees) of this Agreement (the “Fundamental Representations”) shall survive until the expiration of the applicable statute of limitations. If written notice of a claim has been given prior to the expiration of the applicable representations and warranties, then notwithstanding any statement herein to the contrary, the relevant representations and warranties shall survive as to such claim, until such claim is finally resolved. Unless a specified period is set forth in this Agreement (in which event such specified period will control), and for covenants that by their terms are to be performed after the Closing Date, all agreements and covenants contained in this Agreement will survive the Closing and remain in effect until thirty (30) days after the expiration of the applicable statutes of limitations. To avoid any doubt, the parties hereto agree that the time limitations herein limit the time in which a claim may be brought even though such time limits may be less than those otherwise afforded under applicable statutes of limitations. If a claim has been brought within such time periods, the running of such time prior to the final adjudication of such claim shall not time bar the continuation of such claim.

Section 8.02 Indemnification by Majority Stockholders.

(a) From and after the Closing, each of the Majority Stockholders, severally and not jointly, in accordance with each such Majority Stockholder’s respective pro rata share of Merger Consideration received divided by total Merger Consideration paid to all of the Majority Stockholders (such quotient, a “Pro Rata Share”) as shown on Schedule 1 hereto, hereby agree to indemnify, defend and save the Buyer and, to the extent applicable, its Affiliates, stockholders, officers, directors, employees, agents and representatives (each, a “Buyer Indemnified Party” and collectively, the “Buyer Indemnified Parties”) harmless from and against any and all liabilities, deficiencies assessments, losses, costs, expenses, interest, fines, penalties and damages (including reasonable fees and expenses of attorneys and accountants) (individually and collectively, the “Losses”, provided that Losses shall not include any consequential, exemplary or punitive damages (except to the extent paid or payable by an Indemnified Party to a third party in connection with a Third Party Claim)) suffered, sustained or incurred by any Buyer Indemnified Party arising out of or otherwise by virtue of: (i) any breach of any of the representations or warranties of the Company contained in Article III of this Agreement or (ii) the failure of the Company to perform any of their pre-Closing covenants or obligations contained in this Agreement.

Section 8.03 Indemnification by Buyer. From and after the Closing, the Buyer agrees to indemnify, defend and save the Majority Stockholders and to the extent applicable, the Majority Stockholders’ Affiliates, employees, agents and representatives (each, a “Majority Stockholders Indemnified Party” and collectively the “Majority Stockholders Indemnified Parties”) harmless from and against any and all Losses suffered, sustained or incurred by any Majority Stockholders Indemnified Party arising out of or otherwise by virtue of: (a) any breach of any of the representations and warranties of Buyer contained in Article IV of this Agreement or (b) the failure of the Buyer to perform any of its covenants or obligations contained in this Agreement.

Section 8.04 Third Party Indemnification Procedures; Direct Claim Procedures.

(a) If a Buyer Indemnified Party or a Majority Stockholders Indemnified Party seeks indemnification under this Article VII, such party (the “Indemnified Party”) shall promptly give written notice to the other party (the “Indemnifying Party”) of the assertion of any claim or the commencement of any suit, action or proceeding by any third party (a “Third Party Claim”) in respect of which indemnity may be sought under this Article VII. Such notice shall contain details reasonably sufficient to disclose to the Indemnifying Party the nature and scope of the claim including an estimate of the amount of claimed Losses (if known and quantifiable) and copies of all relevant pleadings, documents and information. Any failure in the delivery of such notice shall not affect the obligations of the Indemnifying Party, except to the extent (and only to the extent) that the rights and remedies of the Indemnifying Party are prejudiced as a result of the failure to give, or delay in giving, such notice.

(b) The Indemnifying Party shall be entitled to participate in the defense of any Third Party Claim and, subject to the limitations set forth in this Section 8.04(b), shall be entitled to control and appoint lead counsel for such defense, in each case at its own expense; provided, that (i) the Indemnifying Party provides written notice to the Indemnified Party that the Indemnifying Party intends to undertake such defense and (ii) the Indemnifying Party conducts the defense of the Third Party Claim actively and diligently; provided, further, that the Indemnifying Party shall not have the right to defend against such Third Party Claim (unless otherwise agreed to in writing by the Indemnified Party) if (A) the claim for indemnification relates to or arises in connection with any criminal or quasi-criminal proceeding, action, indictment, allegation or investigation, (B) the claim seeks an injunction or other equitable relief against any Indemnified Party or any of its Affiliates, or (C) the Indemnified Party shall in good faith determine after consultation with outside counsel that the Indemnified Party may have available to it one or more defenses or counterclaims that are inconsistent with one or more of the defenses or counterclaims that may be available to the Indemnifying Party in respect of a Third Party Claim that would make it inappropriate for the same counsel to represent both the Indemnifying Party and the Indemnified Party.

(c) The Indemnifying Party shall notify the Indemnified Party within fifteen (15) days after having received any claim notice with respect to whether or not it is exercising its right to defend the Indemnified Party against the Third Party Claim. If the Indemnifying Party has the right to and elects to assume the control of the defense of any Third Party Claim in accordance with the provisions of this Section 8.04, (i) the Indemnifying Party shall have the right to defend such Third Party Claim with counsel selected by the Indemnifying Party (which counsel shall be subject to the approval of the Indemnified Party, such approval not to be unreasonably withheld, conditioned or delayed), (ii) the Indemnifying Party shall not enter into any settlement agreement with respect to such Third Party Claim without the prior written consent of the Indemnified Party (which shall not be unreasonably withheld, delayed or conditioned) and (iii) the Indemnified Party shall be entitled to participate in the defense of any Third Party Claim and to employ at its expense separate counsel of its choice for such purpose (in which case the counsel of the Indemnifying Party shall reasonably cooperate with such separate counsel to facilitate such participation, including (x) promptly providing to such separate counsel copies of all written materials received in respect of the Third Party Claim, (y) providing such separate counsel a reasonable opportunity to review and comment on materials being drafted and furnished in respect of such Third Party Claim (which such comments shall be considered in good faith) and (z) providing the opportunity to participate in all meetings (whether in person, by teleconference or otherwise) relating to such Third Party Claim).

(d) If the Indemnifying Party does not notify the Indemnified Party that the Indemnifying Party elects to defend the Indemnified Party pursuant to Section 8.04(c) within fifteen (15) days after receipt of notice of a Third Party Claim, or the Indemnifying Party is otherwise not entitled to defend the Indemnified Party pursuant to Section 8.04(b), then the Indemnified Party may defend, and be reimbursed by the Indemnifying Party for its reasonable and documented costs and expenses in regard to, the Third Party Claim with counsel selected by the Indemnified Party in all appropriate proceedings. In such circumstances, the Indemnified Party may defend any such Third Party Claim and have full control of such defense and proceedings including the settlement, compromise or discharge thereof; provided, however, that no such Third Party Claim shall be settled, compromised or discharged by the Indemnified Party without the prior written consent of the Indemnifying Party (which consent shall not be unreasonably withheld, delayed or conditioned). The Indemnifying Party shall be entitled to participate in the defense of any Third Party Claim described in this Section 8.04(d) and to employ one separate counsel of its choice for such purpose (in which case the counsel of the Indemnified Party shall reasonably cooperate with such separate counsel to facilitate such participation, including (x) promptly providing to such separate counsel copies of all written materials received in respect of the Third Party Claim, (y) providing such separate counsel a reasonable opportunity to review and comment on materials being drafted and furnished in respect of such Third Party Claim (which such comments shall be considered in good faith) and (z) providing the opportunity to participate in all meetings (whether in person, by teleconference or otherwise) relating to such Third Party Claim). The fees and expenses of such separate counsel shall be paid by the Indemnifying Party.

(e) Each party shall cooperate, and cause its respective Affiliates to cooperate, in the defense or prosecution of any Third Party Claim and shall furnish or cause to be furnished such records, information and testimony, and attend such conferences, discovery proceedings, hearings, trials or appeals, as may be reasonably requested in connection therewith; provided that no Indemnified Party, upon reasonable advice of counsel, shall have any obligation to disclose any information the disclosure of which would reasonably be expected to result in a violation of applicable Law or is subject to attorney-client or any other privilege, and if requested by an Indemnified Party, the Indemnifying Party will enter into an appropriate joint defense agreement (or other privilege-preserving agreement) in connection with obtaining access to such information.

Section 8.05 Direct Claim Procedures. In the event an Indemnified Party brings a claim for indemnity against an Indemnifying Party that does not involve a Third Party Claim (a “Direct Claim”), the Indemnified Party shall give prompt notice in writing of such Direct Claim to the Indemnifying Party. The failure to give such prompt written notice shall not, however, relieve the Indemnifying Party of its indemnification obligations, except and only to the extent that the Indemnifying Party is materially prejudiced as a result of the failure to give, or delay in giving, such notice. Such notice by the Indemnified Party shall describe the Direct Claim in reasonable detail (excluding anything subject to attorney-client or similar privilege) with respect thereto and shall indicate the estimated amount, if reasonably known and quantifiable and assuming the truth of the facts asserted therein, of the Losses that have been or may be sustained by the Indemnified Party; provided, however, that (a) the notice with respect to a Direct Claim (a “Direct Claim Notice”) need only specify such information to the knowledge of such Indemnified Party as of the date of such notice and (b) shall be updated and amended from time to time by the Indemnified Party by delivering an updated or amended Direct Claim Notice. The Indemnifying Party shall have sixty (60) days after its receipt of such notice to respond in writing to such Direct Claim Notice. During such 60-day period, the Indemnified Party shall allow the Indemnifying Party and its professional advisors to investigate the matter or circumstance alleged to give rise to the Direct Claim, and whether and to what extent any amount is payable in respect of the Direct Claim, and the Indemnified Party shall assist the Indemnifying Party’s investigation by giving such information and assistance (including access to the Indemnified Party’s and the Company’s premises and personnel and the right to examine and copy any accounts, documents or records) as the Indemnifying Party or any of its professional advisors may reasonably request. The Indemnifying Party may object to a claim for indemnification set forth in a Direct Claim Notice by delivering a notice to the Indemnified Party seeking indemnification within sixty (60) days of the delivery of the applicable Direct Claim Notice (the “Direct Claim Objection Deadline”), setting forth in reasonable detail the objections to the Direct Claim. If the Indemnifying Party notifies the applicable Indemnified Party that it objects by the Direct Claim Objection Deadline or fails to object by the Direct Claim Objection Deadline, the Indemnifying Party shall be deemed to have rejected such claim, in which case the Indemnified Party shall be free to pursue such remedies as may be available to the Indemnified Party on the terms and subject to the provisions of this Agreement.

Section 8.06 Limitation on Indemnification Obligation. Notwithstanding anything in this Agreement to the contrary, the liability of the Majority Stockholders to the Buyer Indemnified Parties with respect to claims for indemnification pursuant to Section 8.02(a) (but not with respect to the Fundamental Representations for which recovery shall not be so limited) is subject to the following limitations:

(a) The Majority Stockholders aggregate liability to the Buyer Indemnified Parties for Losses arising under Section 8.02(a)(i) (other than with respect to Fundamental Representations or Fraud for committed by a Seller) shall not exceed 10% of the Purchase Price, as adjusted, with the Buyer Indemnified Parties’ sole source of recovery with respect to such matters being against any unpaid outstanding principal amount of the Stockholders Subordinated Notes.

(b) The Majority Stockholders shall not be liable to the Buyer Indemnified Parties for Losses arising under Section 8.02(a)(i) (other than with respect to Fundamental Representations or Fraud for committed by a Seller) until and unless the aggregate amounts indemnifiable for such breaches exceeds $40,000. In the event the Buyer Indemnified Parties’ claim for Losses, in the aggregate, exceeds $40,000, the Buyer Indemnified Parties shall be entitled to Losses only in excess of such $40,000 threshold.

(c) The Majority Stockholders aggregate liability to the Buyer Indemnified Parties for Losses arising under Section 8.02(a) with respect to Fundamental Representations or with respect to Fraud committed by the Company or a Seller shall not exceed the amount of the Purchase Price actually received by the Majority Stockholders.

(d) The Majority Stockholders shall not be liable to the Buyer Indemnified Parties for Losses arising under Section 8.02(a) unless the claim therefor is asserted in writing on or prior to the expiration of the applicable indemnification matter.

(e) Subject to the other limitations set forth in this Section 8.06, (i) in no event shall the any Seller be liable for more than its Pro Rata Share of any Losses with respect to an indemnification claim pursuant to Section 8.02(a) and (ii) in no event shall the aggregate liability of any Seller for indemnification claims under Section 8.02 exceed the amount of the Purchase Price actually received by such Seller. For the avoidance of doubt, in no event shall any Seller be liable for Fraud committed by any other Seller.

(f) The amount of any Losses that are subject to indemnification under this Article VII shall be calculated net of the amount of any insurance proceeds, indemnification payments or reimbursements actually received by the Buyer Indemnified Parties from third parties (other than the Majority Stockholders) in respect of such Losses (net of any costs or expenses incurred in obtaining such insurance, indemnification or reimbursement, including any increases in insurance premiums or retro-premium adjustments resulting from such recovery), provided, that nothing in this Section 8.06(f) shall be construed as or give rise to an obligation to seek any such insurance, indemnification or reimbursement.

(g) All indemnification payments pursuant to this Article VIII shall be deemed to be adjustments to the Purchase Price.

(h) Any Losses for indemnification under this Agreement shall be determined without duplication of recovery due to the facts giving rise to such Losses constituting a breach of more than one representation, warranty, covenant or agreement.

Section 8.07 Payments. Payments of all amounts owing by an Indemnifying Party under this Article VIIIVIII shall be made promptly upon the final determination (i) by the written agreement between Buyer and the Majority Stockholders or (ii) by a final judgment or decree of any court of competent jurisdiction. In the event where the Majority Stockholders are the Indemnifying Party, the Buyer Indemnified Party shall first offset an amount equal to the amount of the Losses so determined against the unpaid outstanding principal amount of the Stockholders Subordinated Notes and second, subject to the limitations of this Article VII, in the event that the Losses so determined exceeds the then outstanding principal amount of the Stockholders Subordinated Notes, the Majority Stockholders shall pay an amount in cash equal to the excess of the Losses so determined over the then outstanding principal amount of the Stockholders Subordinated Notes to the Buyer Indemnified Party. In the event where Buyer is the Indemnifying Party, the Buyer shall pay to the Seller Indemnified Party an amount in cash equal to the amount of the Losses so determined.

Section 8.08 Exclusive Remedy. The indemnification provided pursuant to this shall be the sole and exclusive remedy for any Losses arising out of this Agreement or related to the transactions contemplated hereby; provided, that the foregoing shall not affect the right of Buyer or the Majority Stockholders, as applicable, (i) to seek specific performance or injunctive relief pursuant to of this Agreement or any Ancillary Agreement, (ii) to recover against any Party in connection with any claim with respect to Fraud, (iii) to recover pursuant to the terms of Section 2.08 of this Agreement, or (iv) to recover under the terms of any Ancillary Agreement pursuant to the terms set forth therein.

Article IX
MISCELLANEOUS

Section 9.01 No Third-Party Beneficiaries. This Agreement will not confer any rights or remedies upon any Person other than the Parties hereto and their respective successors and permitted assigns.

Section 9.02 Entire Agreement. This Agreement and the Ancillary Agreements (including the Exhibits and the Schedules hereto) constitutes the entire agreement among the parties hereto and supersedes any prior understandings, agreements or representations by or among the parties hereto, written or oral, to the extent they related in any way to the subject matter hereof.

Section 9.03 Succession and Assignment. This Agreement will be binding upon and inure to the benefit of the Parties named herein and their respective successors and permitted assigns. No Party hereto may assign either this Agreement or any of its rights, interests or obligations hereunder without the prior written approval, in the case of assignment by the Buyer, by the Company, and, in the case of assignment by the Company, the Buyer.

Section 9.04 Construction. The parties hereto have participated jointly in the negotiation and drafting of this Agreement, and, in the event an ambiguity or question of intent or interpretation arises, this Agreement will be construed as if drafted jointly by the parties, and no presumption or burden of proof will arise favoring or disfavoring any party by virtue of the authorship of any of the provisions of this Agreement.

Exhibit 10.2

FIRST AMENDMENT TO

AGREEMENT AND PLAN OF MERGER

THIS FIRST AMENDMENT TO AGREEMENT AND PLAN OF MERGER (this “Amendment”), dated as of February 9, 2023, is entered into by and among 1847 ICU Holdings Inc., a Delaware corporation (“Buyer”), 1847 ICU Acquisition Sub Inc., a Delaware corporation and a wholly owned Subsidiary of Buyer (“Merger Sub”), ICU Eyewear Holdings, Inc., a California corporation (the “Company”) and San Francisco Equity Partners, solely in its capacity as the Stockholder Representative (collectively, the “Parties”), and amends the Agreement and Plan of Merger, dated as of December 21, 2022 (the “Merger Agreement”) by and among the Parties. Capitalized terms used, but not defined, herein have the meanings set forth in the Merger Agreement.

RECITALS

WHEREAS, Section 2.07 of the Merger Agreement provides for an adjustment to the Aggregate Principal Amount depending on the Net Working Capital’s value in relation to the Net Work Capital Target (the “Working Capital Adjustment”);

WHEREAS, the Parties have agreed to eliminate the Working Capital Adjustment .

WHEREAS, pursuant to Section 7.03 of the Merger Agreement, the Merger Agreement may not be amended except by an instrument in writing signed on behalf of Buyer, Merger Sub, the Company and the Stockholder Representative.

NOW, THEREFORE, BE IT RESOLVED, in consideration of the foregoing recitals and mutual promises set forth herein, the sufficiency of which is acknowledged by the undersigned, the Parties hereby agree to amend the Merger Agreement as follows:

Section 2.07 [Intentionally Deleted.]

Section 3.08 No Undisclosed Liabilities. The Company does not have any Liabilities, except for (a) Liabilities set forth in the Interim Financial Statements, (b) Liabilities which have arisen since the date of the Interim Financial Statements in the ordinary course of business, (c) Liabilities arising in connection with the Merger or the transactions contemplated thereby, and (d) Liabilities to be included in the computation of Indebtedness or Transaction Expenses as of the Closing.

The parties hereto have caused this Amendment to be executed and delivered as of the date first written above.

Exhibit 10.3

THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THIS NOTE HAS BEEN ACQUIRED FOR INVESTMENT AND MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FOR THIS NOTE UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS, OR AN OPINION OF COUNSEL, IN A FORM ACCEPTABLE TO BUYER THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR APPLICABLE STATE SECURITIES LAWS OR UNLESS SOLD PURSUANT TO RULE 144 UNDER SAID ACT.

1847 ICU HOLDINGS INC.

6% SUBORDINATED PROMISSORY NOTE

FOR VALUE RECEIVED, 1847 ICU Holdings Inc., a Delaware corporation (the “Buyer”), hereby promises to pay to the order of Oceanus Investment Inc. (the “Holder”), the principal sum of Two Hundred Forty Thousand Dollars ($240,000) (the “Principal”) in lawful money of the United States of America, together with accrued interest thereon at the rate of six percent (6%) per annum, as provided in this Note. Unless earlier repaid or due in accordance with this Note, the then outstanding Principal amount together with all accrued but unpaid interest and any other amounts payable under this Note shall mature and become due on the first (1^st) anniversary of the date of this Note (the “Maturity Date”).

This Subordinated Promissory Note (this “Note”) has been issued in connection with that certain Agreement and Plan of Merger, dated December 21, 2022 (the “Merger Agreement”), among the Buyer, 1847 ICU Acquisition Sub Inc., a Delaware corporation (“Merger Sub”), ICU Eyewear Holdings Inc., a California corporation (the “Company”), and San Francisco Equity Partners, as the Stockholder Representative, pursuant to which Merger Sub merged with and into the Company, with the Company continuing as the surviving corporation. Capitalized terms used herein but not defined herein shall have the meaning ascribed to them in the Merger Agreement. This Note, together with any similar notes issued by Buyer to any of the other Stockholders in connection herewith, are referred to in the Merger Agreement as the “Stockholders Subordinated Notes”.

The following is a statement of the rights of the Holder and the terms and conditions to which this Note is subject, and to which the Holder by acceptance of this Note, agrees:

1. Principal Repayment.

(a) The Principal shall be paid together with all accrued and unpaid Interest and all other amounts payable hereunder in full on the Maturity Date.

(b) The Principal is subject to adjustment pursuant to the terms of the Merger Agreement, including but not limited to, a reduction or increase of the Principal as described in Section 3 below.

(c) Buyer may prepay the Principal and accrued, but unpaid, interest thereon in whole or in part, without penalty or premium, upon ten (10) Business Days’ prior written notice to the Holder.

2. Interest.

(a) Interest. Interest (“Interest”) on the outstanding Principal shall accrue and be paid at the rates and at the times provided in this Note. Except as otherwise provided in this Note, Interest shall accrue on the aggregate then outstanding Principal at the rate of six percent (6%) per annum (the “Interest Rate”) and shall be paid on the Maturity Date. All computations of Interest hereunder shall be made on the basis of a 360-day year of twelve 30-day months.

(b) Default Interest. If an Event of Default, or an event which, with the giving of notice or passage of time could become an Event of Default, has occurred and thereafter during the continuation of such Event of Default, or if any amount payable under this Note is not paid when due (without regard to any applicable grace periods), whether at maturity, by acceleration or otherwise, the then outstanding Principal and all accrued but unpaid Interest and all other amounts due hereunder shall accrue interest at a rate equal to ten percent (10%) per annum (the “Default Rate”) until (i) such Event of Default is cured (if curable) or such delinquent payment is paid in full, as applicable, and (ii) all Interest accrued at such Default Rate (the “Default Interest”) has been paid in full.

3. Adjustments to Principal.

(a) The Principal of this Note may be adjusted pursuant to Section 2.07 or Section 8.07 of the Merger Agreement.

(b) In the event that the Principal of this Note is adjusted pursuant to either Section 2.07 or Section 8.07 of the Merger Agreement, Buyer shall execute and issue a new note to Holder in the same form as this Note; however, such new Note shall reflect the updated principal amount of this Note as calculated in accordance with either Section 2.07 or Section 8.07, as applicable, and the new Note will include a provision indicating that upon issuance of such new Note, this Note is cancelled and superseded by the new Note; provided, however, that the maturity date under the new Note issued pursuant to this Section 3(b) shall remain unchanged from the maturity date of this Note.

4. Events of Default. The occurrence of any of the following events shall constitute an event of default under this Note (each, an “Event of Default”):

(a) Failure to Pay. Buyer shall default in the payment of the Principal or accrued Interest as and when due and payable hereunder, whether by acceleration or otherwise and such failure continues for two (2) Business Days after the original due date of such payment.

(b) Breach of Covenants. Buyer materially breaches, or defaults in any material manner in the observance or performance of, any covenants, obligations, conditions or agreements set forth in the Merger Agreement, this Note, or any other agreement, certificate or other instrument executed and delivered or entered into by Buyer in connection with the transactions contemplated by the Merger Agreement (collectively, the “Transaction Documents”), other than a payment default as specified in subsection 4(a) above, and (if curable) such breach or default has continued for a period of thirty (30) calendar days after the date on which such breach or default occurs or any officer of Buyer becomes aware of such breach or default.

(c) Breach of Representations and Warranties. Buyer materially breaches any representation or warranty contained in the Transaction Documents or any such representation or warranty of Buyer contains an untrue or misleading statement of a material fact as of the date made, and Buyer shall have failed to cure such breach or failed to address the adverse effects of such untrue or misleading statement to the reasonable satisfaction of the Holder, within thirty (30) calendar days after the date on which such breach occurs or any officer of Buyer becomes aware of such breach or such untrue or misleading statement.

(d) Insolvency; Bankruptcy. If Buyer or the Surviving Corporation shall: (i) admit in writing its inability to pay its debts as they become due; (ii) apply for, consent to, or acquiesce in, the appointment of a trustee, receiver, sequestrator or other custodian for it or any of its property, or make a general assignment for the benefit of its creditors; (iii) in the absence of such application, consent or acquiescence in, permit or suffer to exist the appointment of a trustee, receiver, sequestrator or other custodian for it or for any part of its property; (iv) voluntarily commence, or otherwise consent to, acquiesce in or permit the commencement of, any bankruptcy, reorganization, debt arrangement or any other case or proceeding under any bankruptcy or insolvency law, seeking relief from creditors or any reorganization, arrangement, adjustment, dissolution, winding up, liquidation or other relief with respect to, or any debts of, Buyer or the Surviving Corporation; (v) take any action for the purpose of effecting any of the foregoing; or (vi) if any case, proceeding or other action of a nature referred to in clause (iv) above is involuntarily commenced against Buyer or the Surviving Corporation which (A) results in the entry of any order for relief against Buyer or the Surviving Corporation, as applicable, or (B) is not dismissed or discharged within 60 days of commencement.

(e) Change of Control. Buyer or the Surviving Corporation experiences a Change of Control. “Change of Control” means (i) any person or “group” (within the meaning of Rules 13d-3 and 13d-5 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), obtaining “beneficial ownership” (as defined in Rule 13d-3 of the Exchange Act) in 50% or more of the equity interests of Buyer entitled to vote for the election of members of the board of directors or equivalent body of Buyer; (ii) the consummation by Buyer of a merger, consolidation, reorganization or similar transaction, other than a transaction in which substantially all of the holders of the outstanding ownership interests in Buyer immediately prior to the consummation of the transaction hold or receive directly or indirectly 50% or more of the outstanding ownership interests of the resulting entity or a parent company thereof; (iii) there is consummated a sale, lease, exclusive license or other disposition of all or substantially all of the consolidated assets of Buyer and its subsidiaries to a third party; or (iv) the sale by Buyer of the Surviving Corporation to any third party, whether by means of a sale of ownership interests, merger, sale of assets or otherwise; provided that (A) a transaction shall not constitute a Change of Control if the sole purpose is to change the state of incorporation of Buyer or to create a holding company that will be owned in substantially the same proportions by the individual(s) or entity(ies) who held Buyer’s ownership interests immediately prior to such transaction, and (B) an initial public offering of Buyer shall not constitute a Change of Control.

5. Remedies. Upon the occurrence of any Event of Default and at any time thereafter during the continuation of such Event of Default, the Holder may, by written notice to Buyer, declare the outstanding Principal, together with all accrued and unpaid Interest thereon and all other amounts payable hereunder, immediately due and payable, without presentment, demand, protest, or any other notice or action of any kind, all of which are hereby expressly waived by Buyer; provided, however, upon the occurrence of any Event of Default described in Section 4(d), immediately and without notice, declaration or any other action on the part of the Holder, the outstanding Principal, together with all accrued and unpaid Interest thereon and all other amounts payable hereunder, shall automatically become immediately due and payable. In addition to the forgoing remedies, upon the occurrence and during the continuance of any Event of Default, the Holder may exercise any or all of its rights, powers or remedies under the Transaction Documents or applicable Law, whether by suit in equity, action at law, or both.

6. Covenants. Until all amounts outstanding under this Note have been paid in full:

(a) Maintenance of Existence; Qualification. Buyer shall: (i) preserve and maintain its and the Surviving Corporation’s corporate existence, and (ii) take all actions necessary to preserve and maintain all rights, privileges, and franchises necessary for it and the Surviving Corporation to conduct business in all states and other jurisdictions in which the nature of its business requires qualification to do business.

(b) Notice of Event of Default. Upon the occurrence of an Event of Default or of any event which, with the giving of notice or the passage of time would constitute an Event of Default, as soon as possible thereafter, and in any event within five (5) Business Days after Buyer becomes aware that such Event of Default or other event has occurred, Buyer shall notify the Holder in writing of the nature and extent of such Event of Default and the action, if any, Buyer has taken or proposes to take with respect to such Event of Default.

7. Subordination. All claims of the Holder to principal, interest and any other amounts at any time owed under this Note (collectively, “Junior Indebtedness”) are hereby expressly subordinated in right of payment, as herein set forth, to the prior payment in full of all Senior Indebtedness (as defined below). No payment under Junior Indebtedness shall be made by Buyer, nor shall the Holder exercise any remedies under the Junior Indebtedness (including taking any legal action (whether judicial or otherwise) to collect the Junior Indebtedness), if, at the time of such payment, exercise or immediately after giving effect thereto, (i) there shall exist any “Default” or “Event of Default” under any agreements governing any of the Senior Indebtedness or (ii) the maturity of any of the Senior Indebtedness has been accelerated and such acceleration has not been waived or such Senior Indebtedness has not been paid in full; provided, however, that (x) in the event that the holder of any Senior Indebtedness accelerates such Senior Indebtedness, then the Holder may accelerate the indebtedness evidenced by this Note, and (y) if Buyer is permitted under the terms of the Senior Indebtedness to pay an amount due and owing under this Note and fails to make such payment, then so long as the terms of the Senior Indebtedness do not prohibit such action, the Holder may exercise its rights to be paid such amount, but only such amount (and Holder shall not be permitted to accelerate hereunder). Each holder of any Senior Indebtedness, whether such Senior Indebtedness was created or acquired before or after the issuance of this Note, shall be entitled to rely on the subordination provisions set forth in this Note. Upon the request of Buyer or any holder of Senior Indebtedness, the Holder shall confirm (in writing) the above subordination provisions and shall execute and deliver such additional subordination agreements as any holder of Senior Indebtedness may require. For purposes hereof, “Senior Indebtedness” means, all indebtedness of Buyer or any of its Affiliates (as defined in the Merger Agreement) outstanding on the date of the execution of this Note, to banks, insurance companies, other financial institutions, private equity funds, hedge funds or other similar funds, unless in the instrument creating or evidencing such indebtedness it is provided that such indebtedness is not senior in right of payment to this Note. Senior Indebtedness shall also include indebtedness for taxes owed to federal or state agencies and other indebtedness that by operation of law has a right that is senior to the Junior Indebtedness. 

8. Mutilated, Destroyed, Lost or Stolen Note. If this Note shall become mutilated or defaced, or be destroyed, lost or stolen, Buyer shall execute and deliver a new note of like principal amount in exchange and substitution for the mutilated or defaced Note, or in lieu of and in substitution for the destroyed, lost or stolen Note. In the case of a mutilated or defaced Note, the Holder shall surrender such Note to Buyer. In the case of any destroyed, lost or stolen Note, the Holder shall furnish to Buyer: (i) evidence to its reasonable satisfaction of the destruction, loss or theft of such Note and (ii) such security or indemnity (which shall not include the posting of any bond) as may be reasonably required by Buyer to hold Buyer harmless.

9. Waiver of Demand, Presentment, etc. Buyer hereby expressly waives demand and presentment for payment, notice of nonpayment, protest, notice of protest, notice of dishonor, notice of acceleration or intent to accelerate, bringing of suit and diligence in taking any action to collect amounts called for hereunder and shall be directly and primarily liable for the payment of all sums owing and to be owing hereunder, regardless of and without any notice, diligence, act or omission as or with respect to the collection of any amount called for hereunder. Buyer agrees to reimburse the Holder upon demand for all reasonable out-of-pocket costs and expenses (including reasonable out-of-pocket attorney’s fees and legal expenses) incurred by or on behalf of the Holder in connection with the Holder’s enforcement of any or all of its rights or remedies under this Note, including endeavors to collect any amounts payable hereunder which are not paid when due, whether at maturity, by acceleration or otherwise (“Costs”).

10. Payment. All payments with respect to this Note shall be made in lawful money of the United States of America no later than 5:00 p.m. Eastern Time on the date on which such payment is due by check, at the address of the Holder as of the date hereof or as designated in writing by the Holder from time to time, or by wire transfer of immediately available funds to Holder’s account at a bank specified by Holder in writing to Buyer from time to time. The receipt by the Holder of immediately available funds with respect to this Note shall constitute a payment of Principal and Interest then due and payable hereunder and shall satisfy and discharge the liability for such amounts of Principal and Interest on this Note to the extent of the sum represented by such payment. Payments shall be credited first to Costs, if any, second to the payment of any accrued Default Interest and then all other accrued Interest then due and payable; and third, the remainder applied to the Principal.

11. Assignment. The rights and obligations of Buyer and the Holder with respect to this Note shall be binding upon, and inure to the benefit of, their respective successors and permitted assigns. Buyer may not assign or transfer this Note or any of its rights hereunder without the prior written consent of the Holder. This Note may be assigned or transferred, in whole or in part, by the Holder to any Person at any time as follows. To complete an assignment or transfer this Note, the Holder shall deliver a completed and executed Form of Assignment substantially in the form attached hereto as Exhibit A and surrender and deliver this Note for registration of transfer to Buyer’s office or such other address which Buyer shall designate, upon receipt of which a new Note, in the form of this Note (any such new Note, a “New Note”), evidencing the portion of this Note so transferred shall be issued to and registered in the name of the transferee and a New Note evidencing the remaining portion of this Note not so transferred, if any, shall be issued and registered to the transferring Holder. The acceptance of the New Note by the transferee thereof shall be deemed the acceptance by such transferee of all of the rights and obligations in respect of the New Note that the Holder has in respect of this Note. Interest and principal are payable only to the registered Holder of this Note set forth on the books and records of Buyer.

12. Waiver and Amendment. Any provision of this Note, including, without limitation, the due dates hereof, and the observance of any term hereof, may be amended, waived or modified (either generally or in a particular instance and either retroactively or prospectively) only with the written consent of Buyer and the Holder. The waiver of any provision of this Note shall not operate or be construed to be a waiver of any other provision hereof.

13. Notices. Any notice, request or other communication required or permitted hereunder shall be in writing and shall be deemed to have been duly given if given in accordance with the provisions of the Merger Agreement.

14. Governing Law; Submission to Jurisdiction. All questions concerning the construction, validity, enforcement and interpretation of this Note shall be governed by and construed and enforced solely and exclusively in accordance with the laws of the State of Delaware without regard to any statutory or common-law provision pertaining to conflicts of laws. The Parties hereby irrevocably and unconditionally (i) agree that any legal action, suit, or proceeding arising out of or relating to this Note may be brought in the state and federal courts of competent subject matter jurisdiction located in the State of Delaware; and (ii) submit to the personal jurisdiction of any such courts in any such action, suit, or proceeding. Final judgment against a party hereto in any action, suit, or proceeding shall be conclusive and may be enforced in any other jurisdiction by suit on the judgment. The Parties further agree that the mailing of any service process shall constitute valid and lawful service process against each Party hereto. The Parties waive any claim that that any of the foregoing courts is an inconvenient forum. Nothing in this Section shall affect the right of the Holder to: (i) commence legal proceedings or otherwise sue Buyer in any other court having jurisdiction over Buyer; or (ii) serve process upon Buyer in any manner authorized by the laws of any such jurisdiction.

15. Severability. If one or more provisions of this Note are held to be unenforceable under applicable Law, such provisions shall be excluded from this Note, and the balance of this Note shall be interpreted as if such provisions were so excluded and shall be enforceable in accordance with its terms.

16. Headings. Section headings in this Note are for convenience only and shall not be used in the construction of this Note.

[Signature Page Follows]

IN WITNESS WHEREOF, Buyer has caused this Note to be issued as of the date first above written.

Exhibit A

FORM of assignment

FOR VALUE RECEIVED, the undersigned (“Assignor”) hereby sells, assigns and transfers unto ___________________ (name), __________________________________________ (address) (“Assignee”), all of Assignor’s right, title, and interest in and to US$___________________ of that certain 6% Subordinated Promissory Note, dated as of the _______ day of ___________, 2022 (the “Note”), issued by 1847 ICU Holdings Inc. ( “Buyer”) to the order of Assignor, as Holder, including any and all accrued and unpaid interest owing on the amount specified above, registered in the name of the undersigned on the records of Buyer, and irrevocably appoints Buyer as its attorney-in-fact to transfer the said Note on the books or register of Buyer with full power of substitution.

DATED this ________ day of, __________________, 202_.

Instructions:

Exhibit 10.4

THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THIS NOTE HAS BEEN ACQUIRED FOR INVESTMENT AND MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FOR THIS NOTE UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS, OR AN OPINION OF COUNSEL, IN A FORM ACCEPTABLE TO BUYER THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR APPLICABLE STATE SECURITIES LAWS OR UNLESS SOLD PURSUANT TO RULE 144 UNDER SAID ACT.

1847 ICU HOLDINGS INC.

6% SUBORDINATED PROMISSORY NOTE

FOR VALUE RECEIVED, 1847 ICU Holdings Inc., a Delaware corporation (the “Buyer”), hereby promises to pay to the order of San Francisco Equity Partners III LP (the “Holder”), the principal sum of Two Hundred Fifty Thousand Eight Hundred Fifty Four Dollars and Forty Eight Cents ($251,854.48) (the “Principal”) in lawful money of the United States of America, together with accrued interest thereon at the rate of six percent (6%) per annum, as provided in this Note. Unless earlier repaid or due in accordance with this Note, the then outstanding Principal amount together with all accrued but unpaid interest and any other amounts payable under this Note shall mature and become due on the first (1^st) anniversary of the date of this Note (the “Maturity Date”).

This Subordinated Promissory Note (this “Note”) has been issued in connection with that certain Agreement and Plan of Merger, dated December 21, 2022 (the “Merger Agreement”), among the Buyer, 1847 ICU Acquisition Sub Inc., a Delaware corporation (“Merger Sub”), ICU Eyewear Holdings Inc., a California corporation (the “Company”), and San Francisco Equity Partners, as the Stockholder Representative, pursuant to which Merger Sub merged with and into the Company, with the Company continuing as the surviving corporation. Capitalized terms used herein but not defined herein shall have the meaning ascribed to them in the Merger Agreement. This Note, together with any similar notes issued by Buyer to any of the other Stockholders in connection herewith, are referred to in the Merger Agreement as the “Stockholders Subordinated Notes”.

The following is a statement of the rights of the Holder and the terms and conditions to which this Note is subject, and to which the Holder by acceptance of this Note, agrees:

1. Principal Repayment.

(a) The Principal shall be paid together with all accrued and unpaid Interest and all other amounts payable hereunder in full on the Maturity Date.

(b) The Principal is subject to adjustment pursuant to the terms of the Merger Agreement, including but not limited to, a reduction or increase of the Principal as described in Section 3 below.

(c) Buyer may prepay the Principal and accrued, but unpaid, interest thereon in whole or in part, without penalty or premium, upon ten (10) Business Days’ prior written notice to the Holder.

2. Interest.

(a) Interest. Interest (“Interest”) on the outstanding Principal shall accrue and be paid at the rates and at the times provided in this Note. Except as otherwise provided in this Note, Interest shall accrue on the aggregate then outstanding Principal at the rate of six percent (6%) per annum (the “Interest Rate”) and shall be paid on the Maturity Date. All computations of Interest hereunder shall be made on the basis of a 360-day year of twelve 30-day months.

(b) Default Interest. If an Event of Default, or an event which, with the giving of notice or passage of time could become an Event of Default, has occurred and thereafter during the continuation of such Event of Default, or if any amount payable under this Note is not paid when due (without regard to any applicable grace periods), whether at maturity, by acceleration or otherwise, the then outstanding Principal and all accrued but unpaid Interest and all other amounts due hereunder shall accrue interest at a rate equal to ten percent (10%) per annum (the “Default Rate”) until (i) such Event of Default is cured (if curable) or such delinquent payment is paid in full, as applicable, and (ii) all Interest accrued at such Default Rate (the “Default Interest”) has been paid in full.

3. Adjustments to Principal.

(a) The Principal of this Note may be adjusted pursuant to Section 2.07 or Section 8.07 of the Merger Agreement.

(b) In the event that the Principal of this Note is adjusted pursuant to either Section 2.07 or Section 8.07 of the Merger Agreement, Buyer shall execute and issue a new note to Holder in the same form as this Note; however, such new Note shall reflect the updated principal amount of this Note as calculated in accordance with either Section 2.07 or Section 8.07, as applicable, and the new Note will include a provision indicating that upon issuance of such new Note, this Note is cancelled and superseded by the new Note; provided, however, that the maturity date under the new Note issued pursuant to this Section 3(b) shall remain unchanged from the maturity date of this Note.

4. Events of Default. The occurrence of any of the following events shall constitute an event of default under this Note (each, an “Event of Default”):

(a) Failure to Pay. Buyer shall default in the payment of the Principal or accrued Interest as and when due and payable hereunder, whether by acceleration or otherwise and such failure continues for two (2) Business Days after the original due date of such payment.

(b) Breach of Covenants. Buyer materially breaches, or defaults in any material manner in the observance or performance of, any covenants, obligations, conditions or agreements set forth in the Merger Agreement, this Note, or any other agreement, certificate or other instrument executed and delivered or entered into by Buyer in connection with the transactions contemplated by the Merger Agreement (collectively, the “Transaction Documents”), other than a payment default as specified in subsection 4(a) above, and (if curable) such breach or default has continued for a period of thirty (30) calendar days after the date on which such breach or default occurs or any officer of Buyer becomes aware of such breach or default.

(c) Breach of Representations and Warranties. Buyer materially breaches any representation or warranty contained in the Transaction Documents or any such representation or warranty of Buyer contains an untrue or misleading statement of a material fact as of the date made, and Buyer shall have failed to cure such breach or failed to address the adverse effects of such untrue or misleading statement to the reasonable satisfaction of the Holder, within thirty (30) calendar days after the date on which such breach occurs or any officer of Buyer becomes aware of such breach or such untrue or misleading statement.

(d) Insolvency; Bankruptcy. If Buyer or the Surviving Corporation shall: (i) admit in writing its inability to pay its debts as they become due; (ii) apply for, consent to, or acquiesce in, the appointment of a trustee, receiver, sequestrator or other custodian for it or any of its property, or make a general assignment for the benefit of its creditors; (iii) in the absence of such application, consent or acquiescence in, permit or suffer to exist the appointment of a trustee, receiver, sequestrator or other custodian for it or for any part of its property; (iv) voluntarily commence, or otherwise consent to, acquiesce in or permit the commencement of, any bankruptcy, reorganization, debt arrangement or any other case or proceeding under any bankruptcy or insolvency law, seeking relief from creditors or any reorganization, arrangement, adjustment, dissolution, winding up, liquidation or other relief with respect to, or any debts of, Buyer or the Surviving Corporation; (v) take any action for the purpose of effecting any of the foregoing; or (vi) if any case, proceeding or other action of a nature referred to in clause (iv) above is involuntarily commenced against Buyer or the Surviving Corporation which (A) results in the entry of any order for relief against Buyer or the Surviving Corporation, as applicable, or (B) is not dismissed or discharged within 60 days of commencement.

(e) Change of Control. Buyer or the Surviving Corporation experiences a Change of Control. “Change of Control” means (i) any person or “group” (within the meaning of Rules 13d-3 and 13d-5 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), obtaining “beneficial ownership” (as defined in Rule 13d-3 of the Exchange Act) in 50% or more of the equity interests of Buyer entitled to vote for the election of members of the board of directors or equivalent body of Buyer; (ii) the consummation by Buyer of a merger, consolidation, reorganization or similar transaction, other than a transaction in which substantially all of the holders of the outstanding ownership interests in Buyer immediately prior to the consummation of the transaction hold or receive directly or indirectly 50% or more of the outstanding ownership interests of the resulting entity or a parent company thereof; (iii) there is consummated a sale, lease, exclusive license or other disposition of all or substantially all of the consolidated assets of Buyer and its subsidiaries to a third party; or (iv) the sale by Buyer of the Surviving Corporation to any third party, whether by means of a sale of ownership interests, merger, sale of assets or otherwise; provided that (A) a transaction shall not constitute a Change of Control if the sole purpose is to change the state of incorporation of Buyer or to create a holding company that will be owned in substantially the same proportions by the individual(s) or entity(ies) who held Buyer’s ownership interests immediately prior to such transaction, and (B) an initial public offering of Buyer shall not constitute a Change of Control.

5. Remedies. Upon the occurrence of any Event of Default and at any time thereafter during the continuation of such Event of Default, the Holder may, by written notice to Buyer, declare the outstanding Principal, together with all accrued and unpaid Interest thereon and all other amounts payable hereunder, immediately due and payable, without presentment, demand, protest, or any other notice or action of any kind, all of which are hereby expressly waived by Buyer; provided, however, upon the occurrence of any Event of Default described in Section 4(d), immediately and without notice, declaration or any other action on the part of the Holder, the outstanding Principal, together with all accrued and unpaid Interest thereon and all other amounts payable hereunder, shall automatically become immediately due and payable. In addition to the forgoing remedies, upon the occurrence and during the continuance of any Event of Default, the Holder may exercise any or all of its rights, powers or remedies under the Transaction Documents or applicable Law, whether by suit in equity, action at law, or both.

6. Covenants. Until all amounts outstanding under this Note have been paid in full:

(a) Maintenance of Existence; Qualification. Buyer shall: (i) preserve and maintain its and the Surviving Corporation’s corporate existence, and (ii) take all actions necessary to preserve and maintain all rights, privileges, and franchises necessary for it and the Surviving Corporation to conduct business in all states and other jurisdictions in which the nature of its business requires qualification to do business.

(b) Notice of Event of Default. Upon the occurrence of an Event of Default or of any event which, with the giving of notice or the passage of time would constitute an Event of Default, as soon as possible thereafter, and in any event within five (5) Business Days after Buyer becomes aware that such Event of Default or other event has occurred, Buyer shall notify the Holder in writing of the nature and extent of such Event of Default and the action, if any, Buyer has taken or proposes to take with respect to such Event of Default.

7. Subordination. All claims of the Holder to principal, interest and any other amounts at any time owed under this Note (collectively, “Junior Indebtedness”) are hereby expressly subordinated in right of payment, as herein set forth, to the prior payment in full of all Senior Indebtedness (as defined below). No payment under Junior Indebtedness shall be made by Buyer, nor shall the Holder exercise any remedies under the Junior Indebtedness (including taking any legal action (whether judicial or otherwise) to collect the Junior Indebtedness), if, at the time of such payment, exercise or immediately after giving effect thereto, (i) there shall exist any “Default” or “Event of Default” under any agreements governing any of the Senior Indebtedness or (ii) the maturity of any of the Senior Indebtedness has been accelerated and such acceleration has not been waived or such Senior Indebtedness has not been paid in full; provided, however, that (x) in the event that the holder of any Senior Indebtedness accelerates such Senior Indebtedness, then the Holder may accelerate the indebtedness evidenced by this Note, and (y) if Buyer is permitted under the terms of the Senior Indebtedness to pay an amount due and owing under this Note and fails to make such payment, then so long as the terms of the Senior Indebtedness do not prohibit such action, the Holder may exercise its rights to be paid such amount, but only such amount (and Holder shall not be permitted to accelerate hereunder). Each holder of any Senior Indebtedness, whether such Senior Indebtedness was created or acquired before or after the issuance of this Note, shall be entitled to rely on the subordination provisions set forth in this Note. Upon the request of Buyer or any holder of Senior Indebtedness, the Holder shall confirm (in writing) the above subordination provisions and shall execute and deliver such additional subordination agreements as any holder of Senior Indebtedness may require. For purposes hereof, “Senior Indebtedness” means, all indebtedness of Buyer or any of its Affiliates (as defined in the Merger Agreement) outstanding on the date of the execution of this Note, to banks, insurance companies, other financial institutions, private equity funds, hedge funds or other similar funds, unless in the instrument creating or evidencing such indebtedness it is provided that such indebtedness is not senior in right of payment to this Note. Senior Indebtedness shall also include indebtedness for taxes owed to federal or state agencies and other indebtedness that by operation of law has a right that is senior to the Junior Indebtedness. 

8. Mutilated, Destroyed, Lost or Stolen Note. If this Note shall become mutilated or defaced, or be destroyed, lost or stolen, Buyer shall execute and deliver a new note of like principal amount in exchange and substitution for the mutilated or defaced Note, or in lieu of and in substitution for the destroyed, lost or stolen Note. In the case of a mutilated or defaced Note, the Holder shall surrender such Note to Buyer. In the case of any destroyed, lost or stolen Note, the Holder shall furnish to Buyer: (i) evidence to its reasonable satisfaction of the destruction, loss or theft of such Note and (ii) such security or indemnity (which shall not include the posting of any bond) as may be reasonably required by Buyer to hold Buyer harmless.

9. Waiver of Demand, Presentment, etc. Buyer hereby expressly waives demand and presentment for payment, notice of nonpayment, protest, notice of protest, notice of dishonor, notice of acceleration or intent to accelerate, bringing of suit and diligence in taking any action to collect amounts called for hereunder and shall be directly and primarily liable for the payment of all sums owing and to be owing hereunder, regardless of and without any notice, diligence, act or omission as or with respect to the collection of any amount called for hereunder. Buyer agrees to reimburse the Holder upon demand for all reasonable out-of-pocket costs and expenses (including reasonable out-of-pocket attorney’s fees and legal expenses) incurred by or on behalf of the Holder in connection with the Holder’s enforcement of any or all of its rights or remedies under this Note, including endeavors to collect any amounts payable hereunder which are not paid when due, whether at maturity, by acceleration or otherwise (“Costs”).

10. Payment. All payments with respect to this Note shall be made in lawful money of the United States of America no later than 5:00 p.m. Eastern Time on the date on which such payment is due by check, at the address of the Holder as of the date hereof or as designated in writing by the Holder from time to time, or by wire transfer of immediately available funds to Holder’s account at a bank specified by Holder in writing to Buyer from time to time. The receipt by the Holder of immediately available funds with respect to this Note shall constitute a payment of Principal and Interest then due and payable hereunder and shall satisfy and discharge the liability for such amounts of Principal and Interest on this Note to the extent of the sum represented by such payment. Payments shall be credited first to Costs, if any, second to the payment of any accrued Default Interest and then all other accrued Interest then due and payable; and third, the remainder applied to the Principal.

11. Assignment. The rights and obligations of Buyer and the Holder with respect to this Note shall be binding upon, and inure to the benefit of, their respective successors and permitted assigns. Buyer may not assign or transfer this Note or any of its rights hereunder without the prior written consent of the Holder. This Note may be assigned or transferred, in whole or in part, by the Holder to any Person at any time as follows. To complete an assignment or transfer this Note, the Holder shall deliver a completed and executed Form of Assignment substantially in the form attached hereto as Exhibit A and surrender and deliver this Note for registration of transfer to Buyer’s office or such other address which Buyer shall designate, upon receipt of which a new Note, in the form of this Note (any such new Note, a “New Note”), evidencing the portion of this Note so transferred shall be issued to and registered in the name of the transferee and a New Note evidencing the remaining portion of this Note not so transferred, if any, shall be issued and registered to the transferring Holder. The acceptance of the New Note by the transferee thereof shall be deemed the acceptance by such transferee of all of the rights and obligations in respect of the New Note that the Holder has in respect of this Note. Interest and principal are payable only to the registered Holder of this Note set forth on the books and records of Buyer.

12. Waiver and Amendment. Any provision of this Note, including, without limitation, the due dates hereof, and the observance of any term hereof, may be amended, waived or modified (either generally or in a particular instance and either retroactively or prospectively) only with the written consent of Buyer and the Holder. The waiver of any provision of this Note shall not operate or be construed to be a waiver of any other provision hereof.

13. Notices. Any notice, request or other communication required or permitted hereunder shall be in writing and shall be deemed to have been duly given if given in accordance with the provisions of the Merger Agreement.

14. Governing Law; Submission to Jurisdiction. All questions concerning the construction, validity, enforcement and interpretation of this Note shall be governed by and construed and enforced solely and exclusively in accordance with the laws of the State of Delaware without regard to any statutory or common-law provision pertaining to conflicts of laws. The Parties hereby irrevocably and unconditionally (i) agree that any legal action, suit, or proceeding arising out of or relating to this Note may be brought in the state and federal courts of competent subject matter jurisdiction located in the State of Delaware; and (ii) submit to the personal jurisdiction of any such courts in any such action, suit, or proceeding. Final judgment against a party hereto in any action, suit, or proceeding shall be conclusive and may be enforced in any other jurisdiction by suit on the judgment. The Parties further agree that the mailing of any service process shall constitute valid and lawful service process against each Party hereto. The Parties waive any claim that that any of the foregoing courts is an inconvenient forum. Nothing in this Section shall affect the right of the Holder to: (i) commence legal proceedings or otherwise sue Buyer in any other court having jurisdiction over Buyer; or (ii) serve process upon Buyer in any manner authorized by the laws of any such jurisdiction.

15. Severability. If one or more provisions of this Note are held to be unenforceable under applicable Law, such provisions shall be excluded from this Note, and the balance of this Note shall be interpreted as if such provisions were so excluded and shall be enforceable in accordance with its terms.

16. Headings. Section headings in this Note are for convenience only and shall not be used in the construction of this Note.

[Signature Page Follows]

IN WITNESS WHEREOF, Buyer has caused this Note to be issued as of the date first above written.

Exhibit A

FORM of assignment

FOR VALUE RECEIVED, the undersigned (“Assignor”) hereby sells, assigns and transfers unto ___________________ (name), __________________________________________ (address) (“Assignee”), all of Assignor’s right, title, and interest in and to US$___________________ of that certain 6% Subordinated Promissory Note, dated as of the _______ day of ___________, 2022 (the “Note”), issued by 1847 ICU Holdings Inc. ( “Buyer”) to the order of Assignor, as Holder, including any and all accrued and unpaid interest owing on the amount specified above, registered in the name of the undersigned on the records of Buyer, and irrevocably appoints Buyer as its attorney-in-fact to transfer the said Note on the books or register of Buyer with full power of substitution.

DATED this ________ day of, __________________, 202_.

Instructions:

Exhibit 10.5

THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THIS NOTE HAS BEEN ACQUIRED FOR INVESTMENT AND MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FOR THIS NOTE UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS, OR AN OPINION OF COUNSEL, IN A FORM ACCEPTABLE TO BUYER THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR APPLICABLE STATE SECURITIES LAWS OR UNLESS SOLD PURSUANT TO RULE 144 UNDER SAID ACT.

1847 ICU HOLDINGS INC.

6% SUBORDINATED PROMISSORY NOTE

FOR VALUE RECEIVED, 1847 ICU Holdings Inc., a Delaware corporation (the “Buyer”), hereby promises to pay to the order of Richard Conti (the “Holder”), the principal sum of Two Hundred Five Thousand Four Hundred Thirty Dollars and Forty Cents ($5,430.44) (the “Principal”) in lawful money of the United States of America, together with accrued interest thereon at the rate of six percent (6%) per annum, as provided in this Note. Unless earlier repaid or due in accordance with this Note, the then outstanding Principal amount together with all accrued but unpaid interest and any other amounts payable under this Note shall mature and become due on the first (1^st) anniversary of the date of this Note (the “Maturity Date”).

This Subordinated Promissory Note (this “Note”) has been issued in connection with that certain Agreement and Plan of Merger, dated December 21, 2022 (the “Merger Agreement”), among the Buyer, 1847 ICU Acquisition Sub Inc., a Delaware corporation (“Merger Sub”), ICU Eyewear Holdings Inc., a California corporation (the “Company”), and San Francisco Equity Partners, as the Stockholder Representative, pursuant to which Merger Sub merged with and into the Company, with the Company continuing as the surviving corporation. Capitalized terms used herein but not defined herein shall have the meaning ascribed to them in the Merger Agreement. This Note, together with any similar notes issued by Buyer to any of the other Stockholders in connection herewith, are referred to in the Merger Agreement as the “Stockholders Subordinated Notes”.

The following is a statement of the rights of the Holder and the terms and conditions to which this Note is subject, and to which the Holder by acceptance of this Note, agrees:

1. Principal Repayment.

(a) The Principal shall be paid together with all accrued and unpaid Interest and all other amounts payable hereunder in full on the Maturity Date.

(b) The Principal is subject to adjustment pursuant to the terms of the Merger Agreement, including but not limited to, a reduction or increase of the Principal as described in Section 3 below.

(c) Buyer may prepay the Principal and accrued, but unpaid, interest thereon in whole or in part, without penalty or premium, upon ten (10) Business Days’ prior written notice to the Holder.

2. Interest.

(a) Interest. Interest (“Interest”) on the outstanding Principal shall accrue and be paid at the rates and at the times provided in this Note. Except as otherwise provided in this Note, Interest shall accrue on the aggregate then outstanding Principal at the rate of six percent (6%) per annum (the “Interest Rate”) and shall be paid on the Maturity Date. All computations of Interest hereunder shall be made on the basis of a 360-day year of twelve 30-day months.

(b) Default Interest. If an Event of Default, or an event which, with the giving of notice or passage of time could become an Event of Default, has occurred and thereafter during the continuation of such Event of Default, or if any amount payable under this Note is not paid when due (without regard to any applicable grace periods), whether at maturity, by acceleration or otherwise, the then outstanding Principal and all accrued but unpaid Interest and all other amounts due hereunder shall accrue interest at a rate equal to ten percent (10%) per annum (the “Default Rate”) until (i) such Event of Default is cured (if curable) or such delinquent payment is paid in full, as applicable, and (ii) all Interest accrued at such Default Rate (the “Default Interest”) has been paid in full.

3. Adjustments to Principal.

(a) The Principal of this Note may be adjusted pursuant to Section 2.07 or Section 8.07 of the Merger Agreement.

(b) In the event that the Principal of this Note is adjusted pursuant to either Section 2.07 or Section 8.07 of the Merger Agreement, Buyer shall execute and issue a new note to Holder in the same form as this Note; however, such new Note shall reflect the updated principal amount of this Note as calculated in accordance with either Section 2.07 or Section 8.07, as applicable, and the new Note will include a provision indicating that upon issuance of such new Note, this Note is cancelled and superseded by the new Note; provided, however, that the maturity date under the new Note issued pursuant to this Section 3(b) shall remain unchanged from the maturity date of this Note.

4. Events of Default. The occurrence of any of the following events shall constitute an event of default under this Note (each, an “Event of Default”):

(a) Failure to Pay. Buyer shall default in the payment of the Principal or accrued Interest as and when due and payable hereunder, whether by acceleration or otherwise and such failure continues for two (2) Business Days after the original due date of such payment.

(b) Breach of Covenants. Buyer materially breaches, or defaults in any material manner in the observance or performance of, any covenants, obligations, conditions or agreements set forth in the Merger Agreement, this Note, or any other agreement, certificate or other instrument executed and delivered or entered into by Buyer in connection with the transactions contemplated by the Merger Agreement (collectively, the “Transaction Documents”), other than a payment default as specified in subsection 4(a) above, and (if curable) such breach or default has continued for a period of thirty (30) calendar days after the date on which such breach or default occurs or any officer of Buyer becomes aware of such breach or default.

(c) Breach of Representations and Warranties. Buyer materially breaches any representation or warranty contained in the Transaction Documents or any such representation or warranty of Buyer contains an untrue or misleading statement of a material fact as of the date made, and Buyer shall have failed to cure such breach or failed to address the adverse effects of such untrue or misleading statement to the reasonable satisfaction of the Holder, within thirty (30) calendar days after the date on which such breach occurs or any officer of Buyer becomes aware of such breach or such untrue or misleading statement.

(d) Insolvency; Bankruptcy. If Buyer or the Surviving Corporation shall: (i) admit in writing its inability to pay its debts as they become due; (ii) apply for, consent to, or acquiesce in, the appointment of a trustee, receiver, sequestrator or other custodian for it or any of its property, or make a general assignment for the benefit of its creditors; (iii) in the absence of such application, consent or acquiescence in, permit or suffer to exist the appointment of a trustee, receiver, sequestrator or other custodian for it or for any part of its property; (iv) voluntarily commence, or otherwise consent to, acquiesce in or permit the commencement of, any bankruptcy, reorganization, debt arrangement or any other case or proceeding under any bankruptcy or insolvency law, seeking relief from creditors or any reorganization, arrangement, adjustment, dissolution, winding up, liquidation or other relief with respect to, or any debts of, Buyer or the Surviving Corporation; (v) take any action for the purpose of effecting any of the foregoing; or (vi) if any case, proceeding or other action of a nature referred to in clause (iv) above is involuntarily commenced against Buyer or the Surviving Corporation which (A) results in the entry of any order for relief against Buyer or the Surviving Corporation, as applicable, or (B) is not dismissed or discharged within 60 days of commencement.

(e) Change of Control. Buyer or the Surviving Corporation experiences a Change of Control. “Change of Control” means (i) any person or “group” (within the meaning of Rules 13d-3 and 13d-5 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), obtaining “beneficial ownership” (as defined in Rule 13d-3 of the Exchange Act) in 50% or more of the equity interests of Buyer entitled to vote for the election of members of the board of directors or equivalent body of Buyer; (ii) the consummation by Buyer of a merger, consolidation, reorganization or similar transaction, other than a transaction in which substantially all of the holders of the outstanding ownership interests in Buyer immediately prior to the consummation of the transaction hold or receive directly or indirectly 50% or more of the outstanding ownership interests of the resulting entity or a parent company thereof; (iii) there is consummated a sale, lease, exclusive license or other disposition of all or substantially all of the consolidated assets of Buyer and its subsidiaries to a third party; or (iv) the sale by Buyer of the Surviving Corporation to any third party, whether by means of a sale of ownership interests, merger, sale of assets or otherwise; provided that (A) a transaction shall not constitute a Change of Control if the sole purpose is to change the state of incorporation of Buyer or to create a holding company that will be owned in substantially the same proportions by the individual(s) or entity(ies) who held Buyer’s ownership interests immediately prior to such transaction, and (B) an initial public offering of Buyer shall not constitute a Change of Control.

5. Remedies. Upon the occurrence of any Event of Default and at any time thereafter during the continuation of such Event of Default, the Holder may, by written notice to Buyer, declare the outstanding Principal, together with all accrued and unpaid Interest thereon and all other amounts payable hereunder, immediately due and payable, without presentment, demand, protest, or any other notice or action of any kind, all of which are hereby expressly waived by Buyer; provided, however, upon the occurrence of any Event of Default described in Section 4(d), immediately and without notice, declaration or any other action on the part of the Holder, the outstanding Principal, together with all accrued and unpaid Interest thereon and all other amounts payable hereunder, shall automatically become immediately due and payable. In addition to the forgoing remedies, upon the occurrence and during the continuance of any Event of Default, the Holder may exercise any or all of its rights, powers or remedies under the Transaction Documents or applicable Law, whether by suit in equity, action at law, or both.

6. Covenants. Until all amounts outstanding under this Note have been paid in full:

(a) Maintenance of Existence; Qualification. Buyer shall: (i) preserve and maintain its and the Surviving Corporation’s corporate existence, and (ii) take all actions necessary to preserve and maintain all rights, privileges, and franchises necessary for it and the Surviving Corporation to conduct business in all states and other jurisdictions in which the nature of its business requires qualification to do business.

(b) Notice of Event of Default. Upon the occurrence of an Event of Default or of any event which, with the giving of notice or the passage of time would constitute an Event of Default, as soon as possible thereafter, and in any event within five (5) Business Days after Buyer becomes aware that such Event of Default or other event has occurred, Buyer shall notify the Holder in writing of the nature and extent of such Event of Default and the action, if any, Buyer has taken or proposes to take with respect to such Event of Default.

7. Subordination. All claims of the Holder to principal, interest and any other amounts at any time owed under this Note (collectively, “Junior Indebtedness”) are hereby expressly subordinated in right of payment, as herein set forth, to the prior payment in full of all Senior Indebtedness (as defined below). No payment under Junior Indebtedness shall be made by Buyer, nor shall the Holder exercise any remedies under the Junior Indebtedness (including taking any legal action (whether judicial or otherwise) to collect the Junior Indebtedness), if, at the time of such payment, exercise or immediately after giving effect thereto, (i) there shall exist any “Default” or “Event of Default” under any agreements governing any of the Senior Indebtedness or (ii) the maturity of any of the Senior Indebtedness has been accelerated and such acceleration has not been waived or such Senior Indebtedness has not been paid in full; provided, however, that (x) in the event that the holder of any Senior Indebtedness accelerates such Senior Indebtedness, then the Holder may accelerate the indebtedness evidenced by this Note, and (y) if Buyer is permitted under the terms of the Senior Indebtedness to pay an amount due and owing under this Note and fails to make such payment, then so long as the terms of the Senior Indebtedness do not prohibit such action, the Holder may exercise its rights to be paid such amount, but only such amount (and Holder shall not be permitted to accelerate hereunder). Each holder of any Senior Indebtedness, whether such Senior Indebtedness was created or acquired before or after the issuance of this Note, shall be entitled to rely on the subordination provisions set forth in this Note. Upon the request of Buyer or any holder of Senior Indebtedness, the Holder shall confirm (in writing) the above subordination provisions and shall execute and deliver such additional subordination agreements as any holder of Senior Indebtedness may require. For purposes hereof, “Senior Indebtedness” means, all indebtedness of Buyer or any of its Affiliates (as defined in the Merger Agreement) outstanding on the date of the execution of this Note, to banks, insurance companies, other financial institutions, private equity funds, hedge funds or other similar funds, unless in the instrument creating or evidencing such indebtedness it is provided that such indebtedness is not senior in right of payment to this Note. Senior Indebtedness shall also include indebtedness for taxes owed to federal or state agencies and other indebtedness that by operation of law has a right that is senior to the Junior Indebtedness. 

8. Mutilated, Destroyed, Lost or Stolen Note. If this Note shall become mutilated or defaced, or be destroyed, lost or stolen, Buyer shall execute and deliver a new note of like principal amount in exchange and substitution for the mutilated or defaced Note, or in lieu of and in substitution for the destroyed, lost or stolen Note. In the case of a mutilated or defaced Note, the Holder shall surrender such Note to Buyer. In the case of any destroyed, lost or stolen Note, the Holder shall furnish to Buyer: (i) evidence to its reasonable satisfaction of the destruction, loss or theft of such Note and (ii) such security or indemnity (which shall not include the posting of any bond) as may be reasonably required by Buyer to hold Buyer harmless.

9. Waiver of Demand, Presentment, etc. Buyer hereby expressly waives demand and presentment for payment, notice of nonpayment, protest, notice of protest, notice of dishonor, notice of acceleration or intent to accelerate, bringing of suit and diligence in taking any action to collect amounts called for hereunder and shall be directly and primarily liable for the payment of all sums owing and to be owing hereunder, regardless of and without any notice, diligence, act or omission as or with respect to the collection of any amount called for hereunder. Buyer agrees to reimburse the Holder upon demand for all reasonable out-of-pocket costs and expenses (including reasonable out-of-pocket attorney’s fees and legal expenses) incurred by or on behalf of the Holder in connection with the Holder’s enforcement of any or all of its rights or remedies under this Note, including endeavors to collect any amounts payable hereunder which are not paid when due, whether at maturity, by acceleration or otherwise (“Costs”).

10. Payment. All payments with respect to this Note shall be made in lawful money of the United States of America no later than 5:00 p.m. Eastern Time on the date on which such payment is due by check, at the address of the Holder as of the date hereof or as designated in writing by the Holder from time to time, or by wire transfer of immediately available funds to Holder’s account at a bank specified by Holder in writing to Buyer from time to time. The receipt by the Holder of immediately available funds with respect to this Note shall constitute a payment of Principal and Interest then due and payable hereunder and shall satisfy and discharge the liability for such amounts of Principal and Interest on this Note to the extent of the sum represented by such payment. Payments shall be credited first to Costs, if any, second to the payment of any accrued Default Interest and then all other accrued Interest then due and payable; and third, the remainder applied to the Principal.

11.  Assignment. The rights and obligations of Buyer and the Holder with respect to this Note shall be binding upon, and inure to the benefit of, their respective successors and permitted assigns. Buyer may not assign or transfer this Note or any of its rights hereunder without the prior written consent of the Holder. This Note may be assigned or transferred, in whole or in part, by the Holder to any Person at any time as follows. To complete an assignment or transfer this Note, the Holder shall deliver a completed and executed Form of Assignment substantially in the form attached hereto as Exhibit A and surrender and deliver this Note for registration of transfer to Buyer’s office or such other address which Buyer shall designate, upon receipt of which a new Note, in the form of this Note (any such new Note, a “New Note”), evidencing the portion of this Note so transferred shall be issued to and registered in the name of the transferee and a New Note evidencing the remaining portion of this Note not so transferred, if any, shall be issued and registered to the transferring Holder. The acceptance of the New Note by the transferee thereof shall be deemed the acceptance by such transferee of all of the rights and obligations in respect of the New Note that the Holder has in respect of this Note. Interest and principal are payable only to the registered Holder of this Note set forth on the books and records of Buyer.

12. Waiver and Amendment. Any provision of this Note, including, without limitation, the due dates hereof, and the observance of any term hereof, may be amended, waived or modified (either generally or in a particular instance and either retroactively or prospectively) only with the written consent of Buyer and the Holder. The waiver of any provision of this Note shall not operate or be construed to be a waiver of any other provision hereof.

13. Notices. Any notice, request or other communication required or permitted hereunder shall be in writing and shall be deemed to have been duly given if given in accordance with the provisions of the Merger Agreement.

14. Governing Law; Submission to Jurisdiction. All questions concerning the construction, validity, enforcement and interpretation of this Note shall be governed by and construed and enforced solely and exclusively in accordance with the laws of the State of Delaware without regard to any statutory or common-law provision pertaining to conflicts of laws. The Parties hereby irrevocably and unconditionally (i) agree that any legal action, suit, or proceeding arising out of or relating to this Note may be brought in the state and federal courts of competent subject matter jurisdiction located in the State of Delaware; and (ii) submit to the personal jurisdiction of any such courts in any such action, suit, or proceeding. Final judgment against a party hereto in any action, suit, or proceeding shall be conclusive and may be enforced in any other jurisdiction by suit on the judgment. The Parties further agree that the mailing of any service process shall constitute valid and lawful service process against each Party hereto. The Parties waive any claim that that any of the foregoing courts is an inconvenient forum. Nothing in this Section shall affect the right of the Holder to: (i) commence legal proceedings or otherwise sue Buyer in any other court having jurisdiction over Buyer; or (ii) serve process upon Buyer in any manner authorized by the laws of any such jurisdiction.

15. Severability. If one or more provisions of this Note are held to be unenforceable under applicable Law, such provisions shall be excluded from this Note, and the balance of this Note shall be interpreted as if such provisions were so excluded and shall be enforceable in accordance with its terms.

16. Headings. Section headings in this Note are for convenience only and shall not be used in the construction of this Note.

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IN WITNESS WHEREOF, Buyer has caused this Note to be issued as of the date first above written.

Exhibit A

FORM of assignment

TO: 1847 ICU Holdings INC.

FOR VALUE RECEIVED, the undersigned (“Assignor”) hereby sells, assigns and transfers unto ___________________ (name), __________________________________________ (address) (“Assignee”), all of Assignor’s right, title, and interest in and to US$___________________ of that certain 6% Subordinated Promissory Note, dated as of the _______ day of ___________, 2022 (the “Note”), issued by 1847 ICU Holdings Inc. ( “Buyer”) to the order of Assignor, as Holder, including any and all accrued and unpaid interest owing on the amount specified above, registered in the name of the undersigned on the records of Buyer, and irrevocably appoints Buyer as its attorney-in-fact to transfer the said Note on the books or register of Buyer with full power of substitution.

DATED this ________ day of, __________________, 202_.

Instructions:

Exhibit 10.6

THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THIS NOTE HAS BEEN ACQUIRED FOR INVESTMENT AND MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FOR THIS NOTE UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS, OR AN OPINION OF COUNSEL, IN A FORM ACCEPTABLE TO BUYER THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR APPLICABLE STATE SECURITIES LAWS OR UNLESS SOLD PURSUANT TO RULE 144 UNDER SAID ACT.

1847 ICU HOLDINGS INC.

6% SUBORDINATED PROMISSORY NOTE

FOR VALUE RECEIVED, 1847 ICU Holdings Inc., a Delaware corporation (the “Buyer”), hereby promises to pay to the order of Kirk Hobbs (the “Holder”), the principal sum of Two Thousand Seven Hundred Fifteen and Nine Cents ($2,715.09) (the “Principal”) in lawful money of the United States of America, together with accrued interest thereon at the rate of six percent (6%) per annum, as provided in this Note. Unless earlier repaid or due in accordance with this Note, the then outstanding Principal amount together with all accrued but unpaid interest and any other amounts payable under this Note shall mature and become due on the first (1^st) anniversary of the date of this Note (the “Maturity Date”).

This Subordinated Promissory Note (this “Note”) has been issued in connection with that certain Agreement and Plan of Merger, dated December 21, 2022 (the “Merger Agreement”), among the Buyer, 1847 ICU Acquisition Sub Inc., a Delaware corporation (“Merger Sub”), ICU Eyewear Holdings Inc., a California corporation (the “Company”), and San Francisco Equity Partners, as the Stockholder Representative, pursuant to which Merger Sub merged with and into the Company, with the Company continuing as the surviving corporation. Capitalized terms used herein but not defined herein shall have the meaning ascribed to them in the Merger Agreement. This Note, together with any similar notes issued by Buyer to any of the other Stockholders in connection herewith, are referred to in the Merger Agreement as the “Stockholders Subordinated Notes”.

The following is a statement of the rights of the Holder and the terms and conditions to which this Note is subject, and to which the Holder by acceptance of this Note, agrees:

1. Principal Repayment.

(a) The Principal shall be paid together with all accrued and unpaid Interest and all other amounts payable hereunder in full on the Maturity Date.

(b) The Principal is subject to adjustment pursuant to the terms of the Merger Agreement, including but not limited to, a reduction or increase of the Principal as described in Section 3 below.

(c) Buyer may prepay the Principal and accrued, but unpaid, interest thereon in whole or in part, without penalty or premium, upon ten (10) Business Days’ prior written notice to the Holder.

2. Interest.

(a) Interest. Interest (“Interest”) on the outstanding Principal shall accrue and be paid at the rates and at the times provided in this Note. Except as otherwise provided in this Note, Interest shall accrue on the aggregate then outstanding Principal at the rate of six percent (6%) per annum (the “Interest Rate”) and shall be paid on the Maturity Date. All computations of Interest hereunder shall be made on the basis of a 360-day year of twelve 30-day months.

(b) Default Interest. If an Event of Default, or an event which, with the giving of notice or passage of time could become an Event of Default, has occurred and thereafter during the continuation of such Event of Default, or if any amount payable under this Note is not paid when due (without regard to any applicable grace periods), whether at maturity, by acceleration or otherwise, the then outstanding Principal and all accrued but unpaid Interest and all other amounts due hereunder shall accrue interest at a rate equal to ten percent (10%) per annum (the “Default Rate”) until (i) such Event of Default is cured (if curable) or such delinquent payment is paid in full, as applicable, and (ii) all Interest accrued at such Default Rate (the “Default Interest”) has been paid in full.

3. Adjustments to Principal.

(a) The Principal of this Note may be adjusted pursuant to Section 2.07 or Section 8.07 of the Merger Agreement.

(b) In the event that the Principal of this Note is adjusted pursuant to either Section 2.07 or Section 8.07 of the Merger Agreement, Buyer shall execute and issue a new note to Holder in the same form as this Note; however, such new Note shall reflect the updated principal amount of this Note as calculated in accordance with either Section 2.07 or Section 8.07, as applicable, and the new Note will include a provision indicating that upon issuance of such new Note, this Note is cancelled and superseded by the new Note; provided, however, that the maturity date under the new Note issued pursuant to this Section 3(b) shall remain unchanged from the maturity date of this Note.

4. Events of Default. The occurrence of any of the following events shall constitute an event of default under this Note (each, an “Event of Default”):

(a) Failure to Pay. Buyer shall default in the payment of the Principal or accrued Interest as and when due and payable hereunder, whether by acceleration or otherwise and such failure continues for two (2) Business Days after the original due date of such payment.

(b) Breach of Covenants. Buyer materially breaches, or defaults in any material manner in the observance or performance of, any covenants, obligations, conditions or agreements set forth in the Merger Agreement, this Note, or any other agreement, certificate or other instrument executed and delivered or entered into by Buyer in connection with the transactions contemplated by the Merger Agreement (collectively, the “Transaction Documents”), other than a payment default as specified in subsection 4(a) above, and (if curable) such breach or default has continued for a period of thirty (30) calendar days after the date on which such breach or default occurs or any officer of Buyer becomes aware of such breach or default.

(c) Breach of Representations and Warranties. Buyer materially breaches any representation or warranty contained in the Transaction Documents or any such representation or warranty of Buyer contains an untrue or misleading statement of a material fact as of the date made, and Buyer shall have failed to cure such breach or failed to address the adverse effects of such untrue or misleading statement to the reasonable satisfaction of the Holder, within thirty (30) calendar days after the date on which such breach occurs or any officer of Buyer becomes aware of such breach or such untrue or misleading statement.

(d) Insolvency; Bankruptcy. If Buyer or the Surviving Corporation shall: (i) admit in writing its inability to pay its debts as they become due; (ii) apply for, consent to, or acquiesce in, the appointment of a trustee, receiver, sequestrator or other custodian for it or any of its property, or make a general assignment for the benefit of its creditors; (iii) in the absence of such application, consent or acquiescence in, permit or suffer to exist the appointment of a trustee, receiver, sequestrator or other custodian for it or for any part of its property; (iv) voluntarily commence, or otherwise consent to, acquiesce in or permit the commencement of, any bankruptcy, reorganization, debt arrangement or any other case or proceeding under any bankruptcy or insolvency law, seeking relief from creditors or any reorganization, arrangement, adjustment, dissolution, winding up, liquidation or other relief with respect to, or any debts of, Buyer or the Surviving Corporation; (v) take any action for the purpose of effecting any of the foregoing; or (vi) if any case, proceeding or other action of a nature referred to in clause (iv) above is involuntarily commenced against Buyer or the Surviving Corporation which (A) results in the entry of any order for relief against Buyer or the Surviving Corporation, as applicable, or (B) is not dismissed or discharged within 60 days of commencement.

(e) Change of Control. Buyer or the Surviving Corporation experiences a Change of Control. “Change of Control” means (i) any person or “group” (within the meaning of Rules 13d-3 and 13d-5 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), obtaining “beneficial ownership” (as defined in Rule 13d-3 of the Exchange Act) in 50% or more of the equity interests of Buyer entitled to vote for the election of members of the board of directors or equivalent body of Buyer; (ii) the consummation by Buyer of a merger, consolidation, reorganization or similar transaction, other than a transaction in which substantially all of the holders of the outstanding ownership interests in Buyer immediately prior to the consummation of the transaction hold or receive directly or indirectly 50% or more of the outstanding ownership interests of the resulting entity or a parent company thereof; (iii) there is consummated a sale, lease, exclusive license or other disposition of all or substantially all of the consolidated assets of Buyer and its subsidiaries to a third party; or (iv) the sale by Buyer of the Surviving Corporation to any third party, whether by means of a sale of ownership interests, merger, sale of assets or otherwise; provided that (A) a transaction shall not constitute a Change of Control if the sole purpose is to change the state of incorporation of Buyer or to create a holding company that will be owned in substantially the same proportions by the individual(s) or entity(ies) who held Buyer’s ownership interests immediately prior to such transaction, and (B) an initial public offering of Buyer shall not constitute a Change of Control.

5. Remedies. Upon the occurrence of any Event of Default and at any time thereafter during the continuation of such Event of Default, the Holder may, by written notice to Buyer, declare the outstanding Principal, together with all accrued and unpaid Interest thereon and all other amounts payable hereunder, immediately due and payable, without presentment, demand, protest, or any other notice or action of any kind, all of which are hereby expressly waived by Buyer; provided, however, upon the occurrence of any Event of Default described in Section 4(d), immediately and without notice, declaration or any other action on the part of the Holder, the outstanding Principal, together with all accrued and unpaid Interest thereon and all other amounts payable hereunder, shall automatically become immediately due and payable. In addition to the forgoing remedies, upon the occurrence and during the continuance of any Event of Default, the Holder may exercise any or all of its rights, powers or remedies under the Transaction Documents or applicable Law, whether by suit in equity, action at law, or both.

6. Covenants. Until all amounts outstanding under this Note have been paid in full:

(a) Maintenance of Existence; Qualification. Buyer shall: (i) preserve and maintain its and the Surviving Corporation’s corporate existence, and (ii) take all actions necessary to preserve and maintain all rights, privileges, and franchises necessary for it and the Surviving Corporation to conduct business in all states and other jurisdictions in which the nature of its business requires qualification to do business.

(b) Notice of Event of Default. Upon the occurrence of an Event of Default or of any event which, with the giving of notice or the passage of time would constitute an Event of Default, as soon as possible thereafter, and in any event within five (5) Business Days after Buyer becomes aware that such Event of Default or other event has occurred, Buyer shall notify the Holder in writing of the nature and extent of such Event of Default and the action, if any, Buyer has taken or proposes to take with respect to such Event of Default.

7. Subordination. All claims of the Holder to principal, interest and any other amounts at any time owed under this Note (collectively, “Junior Indebtedness”) are hereby expressly subordinated in right of payment, as herein set forth, to the prior payment in full of all Senior Indebtedness (as defined below). No payment under Junior Indebtedness shall be made by Buyer, nor shall the Holder exercise any remedies under the Junior Indebtedness (including taking any legal action (whether judicial or otherwise) to collect the Junior Indebtedness), if, at the time of such payment, exercise or immediately after giving effect thereto, (i) there shall exist any “Default” or “Event of Default” under any agreements governing any of the Senior Indebtedness or (ii) the maturity of any of the Senior Indebtedness has been accelerated and such acceleration has not been waived or such Senior Indebtedness has not been paid in full; provided, however, that (x) in the event that the holder of any Senior Indebtedness accelerates such Senior Indebtedness, then the Holder may accelerate the indebtedness evidenced by this Note, and (y) if Buyer is permitted under the terms of the Senior Indebtedness to pay an amount due and owing under this Note and fails to make such payment, then so long as the terms of the Senior Indebtedness do not prohibit such action, the Holder may exercise its rights to be paid such amount, but only such amount (and Holder shall not be permitted to accelerate hereunder). Each holder of any Senior Indebtedness, whether such Senior Indebtedness was created or acquired before or after the issuance of this Note, shall be entitled to rely on the subordination provisions set forth in this Note. Upon the request of Buyer or any holder of Senior Indebtedness, the Holder shall confirm (in writing) the above subordination provisions and shall execute and deliver such additional subordination agreements as any holder of Senior Indebtedness may require. For purposes hereof, “Senior Indebtedness” means, all indebtedness of Buyer or any of its Affiliates (as defined in the Merger Agreement) outstanding on the date of the execution of this Note, to banks, insurance companies, other financial institutions, private equity funds, hedge funds or other similar funds, unless in the instrument creating or evidencing such indebtedness it is provided that such indebtedness is not senior in right of payment to this Note. Senior Indebtedness shall also include indebtedness for taxes owed to federal or state agencies and other indebtedness that by operation of law has a right that is senior to the Junior Indebtedness. 

8. Mutilated, Destroyed, Lost or Stolen Note. If this Note shall become mutilated or defaced, or be destroyed, lost or stolen, Buyer shall execute and deliver a new note of like principal amount in exchange and substitution for the mutilated or defaced Note, or in lieu of and in substitution for the destroyed, lost or stolen Note. In the case of a mutilated or defaced Note, the Holder shall surrender such Note to Buyer. In the case of any destroyed, lost or stolen Note, the Holder shall furnish to Buyer: (i) evidence to its reasonable satisfaction of the destruction, loss or theft of such Note and (ii) such security or indemnity (which shall not include the posting of any bond) as may be reasonably required by Buyer to hold Buyer harmless.

9. Waiver of Demand, Presentment, etc. Buyer hereby expressly waives demand and presentment for payment, notice of nonpayment, protest, notice of protest, notice of dishonor, notice of acceleration or intent to accelerate, bringing of suit and diligence in taking any action to collect amounts called for hereunder and shall be directly and primarily liable for the payment of all sums owing and to be owing hereunder, regardless of and without any notice, diligence, act or omission as or with respect to the collection of any amount called for hereunder. Buyer agrees to reimburse the Holder upon demand for all reasonable out-of-pocket costs and expenses (including reasonable out-of-pocket attorney’s fees and legal expenses) incurred by or on behalf of the Holder in connection with the Holder’s enforcement of any or all of its rights or remedies under this Note, including endeavors to collect any amounts payable hereunder which are not paid when due, whether at maturity, by acceleration or otherwise (“Costs”).

10. Payment. All payments with respect to this Note shall be made in lawful money of the United States of America no later than 5:00 p.m. Eastern Time on the date on which such payment is due by check, at the address of the Holder as of the date hereof or as designated in writing by the Holder from time to time, or by wire transfer of immediately available funds to Holder’s account at a bank specified by Holder in writing to Buyer from time to time. The receipt by the Holder of immediately available funds with respect to this Note shall constitute a payment of Principal and Interest then due and payable hereunder and shall satisfy and discharge the liability for such amounts of Principal and Interest on this Note to the extent of the sum represented by such payment. Payments shall be credited first to Costs, if any, second to the payment of any accrued Default Interest and then all other accrued Interest then due and payable; and third, the remainder applied to the Principal.

11.  Assignment. The rights and obligations of Buyer and the Holder with respect to this Note shall be binding upon, and inure to the benefit of, their respective successors and permitted assigns. Buyer may not assign or transfer this Note or any of its rights hereunder without the prior written consent of the Holder. This Note may be assigned or transferred, in whole or in part, by the Holder to any Person at any time as follows. To complete an assignment or transfer this Note, the Holder shall deliver a completed and executed Form of Assignment substantially in the form attached hereto as Exhibit A and surrender and deliver this Note for registration of transfer to Buyer’s office or such other address which Buyer shall designate, upon receipt of which a new Note, in the form of this Note (any such new Note, a “New Note”), evidencing the portion of this Note so transferred shall be issued to and registered in the name of the transferee and a New Note evidencing the remaining portion of this Note not so transferred, if any, shall be issued and registered to the transferring Holder. The acceptance of the New Note by the transferee thereof shall be deemed the acceptance by such transferee of all of the rights and obligations in respect of the New Note that the Holder has in respect of this Note. Interest and principal are payable only to the registered Holder of this Note set forth on the books and records of Buyer.

12. Waiver and Amendment. Any provision of this Note, including, without limitation, the due dates hereof, and the observance of any term hereof, may be amended, waived or modified (either generally or in a particular instance and either retroactively or prospectively) only with the written consent of Buyer and the Holder. The waiver of any provision of this Note shall not operate or be construed to be a waiver of any other provision hereof.

13. Notices. Any notice, request or other communication required or permitted hereunder shall be in writing and shall be deemed to have been duly given if given in accordance with the provisions of the Merger Agreement.

14. Governing Law; Submission to Jurisdiction. All questions concerning the construction, validity, enforcement and interpretation of this Note shall be governed by and construed and enforced solely and exclusively in accordance with the laws of the State of Delaware without regard to any statutory or common-law provision pertaining to conflicts of laws. The Parties hereby irrevocably and unconditionally (i) agree that any legal action, suit, or proceeding arising out of or relating to this Note may be brought in the state and federal courts of competent subject matter jurisdiction located in the State of Delaware; and (ii) submit to the personal jurisdiction of any such courts in any such action, suit, or proceeding. Final judgment against a party hereto in any action, suit, or proceeding shall be conclusive and may be enforced in any other jurisdiction by suit on the judgment. The Parties further agree that the mailing of any service process shall constitute valid and lawful service process against each Party hereto. The Parties waive any claim that that any of the foregoing courts is an inconvenient forum. Nothing in this Section shall affect the right of the Holder to: (i) commence legal proceedings or otherwise sue Buyer in any other court having jurisdiction over Buyer; or (ii) serve process upon Buyer in any manner authorized by the laws of any such jurisdiction.

15. Severability. If one or more provisions of this Note are held to be unenforceable under applicable Law, such provisions shall be excluded from this Note, and the balance of this Note shall be interpreted as if such provisions were so excluded and shall be enforceable in accordance with its terms.

16. Headings. Section headings in this Note are for convenience only and shall not be used in the construction of this Note.

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IN WITNESS WHEREOF, Buyer has caused this Note to be issued as of the date first above written.

Exhibit A

FORM of assignment

TO:      1847 ICU Holdings INC.

FOR VALUE RECEIVED, the undersigned (“Assignor”) hereby sells, assigns and transfers unto ___________________ (name), __________________________________________ (address) (“Assignee”), all of Assignor’s right, title, and interest in and to US$___________________ of that certain 6% Subordinated Promissory Note, dated as of the _______ day of ___________, 2022 (the “Note”), issued by 1847 ICU Holdings Inc. ( “Buyer”) to the order of Assignor, as Holder, including any and all accrued and unpaid interest owing on the amount specified above, registered in the name of the undersigned on the records of Buyer, and irrevocably appoints Buyer as its attorney-in-fact to transfer the said Note on the books or register of Buyer with full power of substitution.

DATED this ________ day of, __________________, 202_.

Instructions:

Exhibit 10.7

MANAGEMENT SERVICES AGREEMENT

MANAGEMENT SERVICES AGREEMENT (as amended, revised, supplemented or otherwise modified from time to time, this “Agreement”), dated as of February 9, 2023, by and between 1847 ICU HOLDINGS INC., a Delaware corporation (the “Company”), and 1847 PARTNERS LLC, a Delaware limited liability company (the “Manager”). Each party hereto shall be referred to as, individually, a “Party” and, collectively, the “Parties.”

BACKGROUND

The Board of Directors of the Company has determined that it would be in the best interests of the Company to appoint the Manager to perform the Services (as such term is defined herein) and, therefore, the Company has agreed to appoint the Manager to perform the Services on the terms and subject to the conditions set forth herein. The Manager has agreed to act as Manager and to perform the Services on the terms and subject to the conditions set forth herein.

The Manager also acts as an external manager for 1847 Holdings LLC (the “Parent”), the Company’s parent entity, pursuant to the Management Services Agreement by and between the Manager and the Parent, dated as of April 15, 2013, as amended (the “Parent MSA”). This Agreement is an Offsetting Management Services Agreement as defined and referenced in the Parent MSA.

AGREEMENT

NOW, THEREFORE, in consideration of the mutual covenants, representations, warranties and agreements contained herein, and of other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and intending to be legally bound hereby, the Parties hereto agree as follows:

ARTICLE I

DEFINITIONS

For all purposes of this Agreement, except as otherwise expressly provided or unless the context otherwise requires: the terms defined in this Article have the meanings assigned to them in this Article and include the plural as well as the singular; any reference to an “Article,” “Section” or an “Exhibit” refers to an Article, Section or an Exhibit, as the case may be, of this Agreement; and the words “herein,” “hereinafter,” “hereof,” “hereto” and “hereunder” and other words of similar import refer to this Agreement as a whole and not to any particular Article, Section or other subdivision:

“Affiliate” means, with respect to any Person, (i) any Person directly or indirectly controlling, controlled by or under common control with such Person or (ii) any officer, director, general member, member or trustee of such Person. For purposes of this definition, the terms “controlling,” “controlled by” or “under common control with” shall mean, with respect to any Persons, the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting securities, by contract or otherwise, or the power to elect at least 50% of the directors, managers, general members, or Persons exercising similar authority with respect to such Person.

“Agreement” has the meaning set forth in the preamble of this Agreement.

“Board of Directors” means the Board of Directors of the Company or any committee thereof that has been duly authorized by the Board of Directors to make a decision on the matter in question or bind the Company as to the matter in question.

“Business Day” means any day other than a Saturday, a Sunday or a day on which banks in the City of New York are required, permitted or authorized, by applicable law or executive order, to be closed for regular banking business.

“Commencement Date” means the date of this Agreement.

“Company” has the meaning set forth in the preamble of this Agreement.

“Company Information” means any information concerning the Company or any of the Subsidiaries of the Company and their respective financial condition, business or operations that (i) relates to earnings, (ii) is competitively sensitive, (iii) relates to trade secrets, (iv) is proprietary or (v) is similar to any of the foregoing information.

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

“Federal Securities Laws” means, collectively, the Securities Act, the Exchange Act and the rules and regulations promulgated thereunder.

“Fiscal Quarter” means each fiscal quarter of the Company for purposes of the Parent’s reporting obligations under the Exchange Act.

“Fiscal Year” means each fiscal year of the Company for purposes of the Parent’s reporting obligations under the Exchange Act.

“GAAP” means generally accepted accounting principles in effect in the United States, consistently applied.

“Gross Income” has the meaning set forth in Section 61(a) of the Internal Revenue Code of 1986, as amended.

“Incur” means, with respect to any Indebtedness or other obligation of a Person, to create, issue, acquire (by conversion, exchange or otherwise), assume, suffer, guarantee or otherwise become liable in respect of such Indebtedness or other obligation.

“Indebtedness” means, with respect to any Person, (i) any liability for borrowed money, or under any reimbursement obligation relating to a letter of credit, (ii) all indebtedness (including bond, note, debenture, purchase money obligation or similar instrument) for the acquisition of any businesses, properties or assets of any kind (other than property, including inventory, and services purchased, trade payables, other expenses accruals and deferred compensation items arising in the Ordinary Course of Business), (iii) all obligations under leases that have been or should be, in accordance with GAAP, recorded as capital leases, (iv) any liabilities of others described in the preceding clauses (i) to (iii) (inclusive) that such Person has guaranteed or for which such Person is otherwise legally obligated, and (without duplication) any amendment, supplement, modification, deferral, renewal, extension or refunding of any liability of the types referred to in clauses (i) through (iv) above.

“Indemnified Parties” has the meaning set forth in Article IX hereof.

“Losses” has the meaning set forth in Article IX hereof.

“Management Fee” has the meaning set forth in Section 7.1(a) hereof.

“Management Fee Payment Date” means the first Business Day of each Fiscal Quarter or, in the case of the Fiscal Quarter in which this Agreement is terminated, the Termination Date.

“Manager” has the meaning set forth in the preamble of this Agreement.

“Non-Critical Services” means any Services other than the Services for which the Manager was engaged by the Company in light of the experience and expertise of the employees of the Manager.

“Ordinary Course of Business” means, with respect to any Person, an action taken by such Person if such action is (i) consistent with the past practices of such Person and is taken in the normal day-to-day business or operations of such Person and (ii) which is not required to be specifically authorized or approved by the board of directors of such Person.

“Parent” has the meaning set forth in the recitals to this Agreement.

“Parent Management Fee” has the meaning set forth in Section 7.1(a) hereof.

“Parent MSA” has the meaning set forth in the recitals to this Agreement.

“Party” and “Parties” have the meaning set forth in the preamble of this Agreement.

“Person” means any individual, company (whether general or limited), limited liability company, corporation, trust, estate, association, nominee or other entity.

“Securities Act” means the Securities Act of 1933, as amended.

“Services” has the meaning set forth in Section 3.1(b) hereof.

“Subsidiary” means, with respect to any Person, any corporation, company, joint venture, limited liability company, association or other entity in which such Person owns, directly or indirectly, more than 50% of the outstanding voting equity securities or interests, the holders of which are generally entitled to vote for the election of the board of directors or other governing body of such entity.

“Termination Date” means the date upon which this Agreement is terminated pursuant Article VIII hereof.

ARTICLE II

APPOINTMENT OF THE MANAGER

Section 2.1 Appointment. The Company hereby agrees to, and hereby does, appoint the Manager to perform the Services as set forth in Section 3.1 herein and in accordance with the terms and conditions of this Agreement

Section 2.2 Term. The Manager shall provide Services to the Company from the Commencement Date until the termination of this Agreement in accordance with Article VIII hereof.

ARTICLE III

OBLIGATIONS OF THE PARTIES

Section 3.1 Obligations of the Manager

(a) Subject always to the oversight and supervision of the Board of Directors and the terms and conditions of this Agreement, the Manager shall during the term of this Agreement perform the Services as set forth in Section 3.1(b) below and comply with the operational objectives and business plans of the Company in existence from time to time. The Company shall promptly provide the Manager with all stated operational objectives and business plans of the Company approved by the Board of Directors and any other available information reasonably requested by the Manager.

(b) The Manager agrees and covenants that it shall perform, or cause to be performed, the following services hereunder (as may be modified from time to time pursuant to Section 3.3 hereof, the “Services”):

(i) conduct general and administrative supervision and oversight of the Company’s day-to-day business and operations, including, but not limited to, recruiting and hiring of personnel, administration of personnel and personnel benefits, development of administrative policies and procedures, establishment and management of banking services, managing and arranging for the maintaining of liability insurance, arranging for equipment rental, maintenance of all necessary permits and licenses, acquisition of any additional licenses and permits that become necessary, participation in risk management policies and procedures; and

(ii) oversee and consult with respect to the Company’s business and operational strategies, the implementation of such strategies and the evaluation of such strategies, including, but not limited to, strategies with respect to capital expenditure and expansion programs, acquisitions or dispositions and product or service lines.

(c) In connection with the performance of the Services under this Agreement, the Manager shall have all necessary power and authority to perform, or cause to be performed, such Services on behalf of the Company.

(d) In connection with the performance of its obligations under this Agreement, the Manager is not permitted to engage in any activities that would cause it to become an “investment adviser” as defined in Section 202(a)(11) of the Investment Advisers Act of 1940, as amended, or any successor provision thereto.

(e) While the Manager is providing the Services under this Agreement, the Manager shall also be permitted to provide services, including services similar to the Services covered hereby, to other Persons, including Affiliates of the Manager. This Agreement and the Manager's obligation to provide the Services under this Agreement shall not create an exclusive relationship between the Manager and its Affiliates, on the one hand, and the Company and its Subsidiaries, on the other.

Section 3.2 Obligations of the Company

(a) The Company shall, and the Company shall cause its Subsidiaries to, do all things reasonably necessary on their part as requested by the Manager consistent with the terms of this Agreement to enable the Company to fulfill its obligations under this Agreement.

(b) The Company shall, and the Company shall cause its Subsidiaries to, take reasonable steps to ensure that (i) the officers and employees of the Company and its Subsidiaries, as the case may be, act in accordance with the terms of this Agreement and the reasonable directions of the Manager in fulfilling the Manager’s obligations hereunder and allowing the Manager to exercise its powers and rights hereunder and (ii) the Company and its Subsidiaries provide to the Manager alt reports (including monthly management reports and all other relevant reports) that the Manager may reasonably require and on such dates as the Manager may reasonably require.

Section 3.3 Change of Services

(a) The Company and the Manager shall have the right at any time during the term of this Agreement to change the Services provided by the Manager and such changes shall in no way otherwise affect the rights or obligations of any Party hereunder.

(b) Any change in the Services shall be authorized in writing and evidenced by an amendment to this Agreement, as provided in Section 12.9 hereof. Unless otherwise agreed in writing, the provisions of this Agreement shall apply to all changes in the Services.

ARTICLE IV

POWERS OF THE MANAGER

Section 4.1 Powers of the Manager

(a) The Manager shall have no power to enter into any contract for or on behalf of the Company or otherwise subject it to any obligation, such power to be the sole right and obligation of the Company, acting through its Board of Directors and/or the Company’s officers.

(b) Subject to Section 4.2 and for purposes other than to delegate its duties and powers to perform the Services hereunder, the Manager shall have the power to engage any agents (including real estate agents and managing agents), valuers, contractors and advisors (including operational, accounting, financial, tax and legal advisors) that it deems necessary or desirable in connection with the performance of its obligations hereunder, which costs therefor shall be subject to reimbursement in accordance with Section 7.2 hereto.

Section 4.2 Delegation. The Manager may delegate or appoint (a) any of its Affiliates as its agent, at its own cost and expense, to perform any or all of the Services hereunder; or (b) any Person, whether or not an Affiliate of the Manager, as its agent, at its own cost and expense, to perform those Services hereunder which, in the sole discretion of the Manager, are Non-Critical Services; provided, however, that, in each case, the Manager shall not be relieved of any of its obligations or duties owed to the Company hereunder as a result of such delegation. The Manager shall be permitted to share Company Infom1ation with its appointed agents subject to appropriate, reasonable and customary confidentiality arrangements. For the avoidance of doubt, any reference to Manager herein shall include its delegates or appointees pursuant to this Section 4.2

Section 4.3 Manager’s Obligations, Duties and Powers Exclusive. The Company agrees that during the term of this Agreement, the obligations, duties and powers imposed on and granted to the Manager under Article III and this Article IV are to be performed or held exclusively by the Manager, subject to Section 4.2 hereof, and the Company shall not, either directly or indirectly, through its employees, Board of Directors or any other Person, as the case may be, perfo1m any of the Services except in circumstances where it is necessary to do so to comply with applicable law or as otherwise agreed by the Manager.

ARTICLE V

INSPECTION OF RECORDS

Section 5.1 Books and Records of the Company. At all reasonable times and on reasonable notice, the Manager and any Person authorized by the Manager shall have access to, and the right to inspect, for any reasonable purpose, during the term of this Agreement and for a period of five (5) years after termination hereof, the books, records and data stored in computers and all documentation of the Company pertaining to all Services performed, or to be performed, by the Manager or the Management Fee paid, or to be paid, by the Company to the Manager, in each case, hereunder. There shall be no cost or expense charged by any Party to another Party pursuant to the exercise of any right under this Section 5.1.

Section 5.2 Books and Records of the Manager. At all reasonable times and on reasonable notice, the Company and any Person authorized by the Company shall have access to, and the right to inspect the books, records and data stored in computers and all documentation of the Manager pertaining to all Services performed, or to be performed, by the Manager or the Management Fee paid, or to be paid, by the Company to the Manager, in each case, hereunder. There shall be no cost or expense charged by any Party to another Party pursuant to the exercise of any right under this Section 5.2.

ARTICLE VI

AUTHORITY OF THE COMPANY AND THE MANAGER

Each Party represents and warrants to the other that it is duly authorized with full power and authority to execute, deliver and perform its obligations and duties under this Agreement. The Company represents and warrants that the engagement of the Manager has been duly authorized by the Board of Directors and is in accordance with all governing documents of the Company.

ARTICLE VII

MANAGEMENT FEE; EXPENSES

Section 7.1 Management Fee

(a) Subject to the terms and conditions set forth in this Section 7.1, for the term of this Agreement, as payment to the Manager for performing Services hereunder during any Fiscal Quarter or any part thereof, the Company shall pay a quarterly management fee (the “Management Fee”) to the Manager on each Management Fee Payment Date for such Fiscal Quarter equal to the greater of $75,000 or 2% of Adjusted Net Assets (as defined in the Parent MSA) of the Company; provided, however, that (i) with respect to the Fiscal Quarter in which the Commencement Date occurs, the Management Fee with respect to such Fiscal Quarter or part thereof shall be equal to the product of (x) the Management Fee, multiplied by (y) a fraction, the numerator of which is the number of days from and including the Commencement Date to and including the last day of such Fiscal Quarter and the denominator of which is the number of days in such Fiscal Quarter, (ii) with respect to the Fiscal Quarter in which this Agreement is terminated, the Management Fee with respect to such Fiscal Quarter or part thereof shall be equal to the product of (x) the Management Fee, multiplied by (y) a fraction, the numerator of which is the number of days from and including the first day of such Fiscal Quarter to but excluding the date upon which this Agreement is terminated and the denominator of which is the number of days in such Fiscal Quarter, (iii) if the aggregate amount of Management Fees paid or to be paid by the Company, together with all other management fees paid or to be paid by all other Subsidiaries of the Parent to the Manager, in each case, with respect to any Fiscal Year exceeds, or is expected to exceed, 9.5% of the Parent’s Gross Income with respect to such Fiscal Year, then the Manager agrees that the Management Fee to be paid by the Company for any remaining Fiscal Quarters in such Fiscal Year shall be reduced, on a pro rata basis determined by reference to the management fees to be paid to the Manager by all of the Subsidiaries of the Parent, until the aggregate amount of the Management Fee paid or to be paid by the Company, together with all other management fees paid or to be paid by all other Subsidiaries of the Parent to the Manager, in each case, with respect to such Fiscal Year, does not exceed 9.5% of the Parent’s Gross Income with respect to such Fiscal Year, and (iv) if the aggregate amount the Management Fee paid or to be paid by the Company, together with all other management fees paid or to be paid by all other Subsidiaries of the Parent to the Manager, in each case, with respect to any Fiscal Quarter exceeds, or is expected to exceed, the aggregate amount of the management fee (before any adjustment thereto) calculated and payable under the Parent MSA (the “Parent Management Fee”) with respect to such Fiscal Quarter, then the Manager agrees that the Management Fee to be paid by the Company for such Fiscal Quarter shall be reduced, on a pro rata basis, until the aggregate amount of the Management Fee paid or to be paid by the Company, together with all other management fees paid or to be paid by all other Subsidiaries of the Parent to the Manager, in each case, with respect to such Fiscal Quarter, does not exceed the Parent Management Fee calculated and payable with respect to such Fiscal Quarter. The Management Fee shall be paid in U.S. dollars by wire transfer in immediately available funds to an account or accounts designated by the Manager from time to time.

(b) If the Company does not have sufficient liquid assets to timely pay the entire amount of the Management Fee due on any Management Fee Payment Date, the Company shall liquidate assets or Incur Indebtedness in order to pay such Management Fee in full on such Management Fee Payment Date; provided, however, that if the Management Fee due on any Management Fee Payment Date cannot be paid by the Company as the result of subordination provisions or other restrictions contained in financing or other agreements between the Company and its senior lenders or the senior lenders of any of its affiliates, then the Management Fee shall accrue and be paid as soon as the Company is able to pay the Management Fee without violation such subordination provision or other restrictions.

Section 7.2 Reimbursement of Expenses

(a) Subject to Section 7.2(b), the Company shall reimburse the Manager for all costs and expenses of the Company, including all out-of-pocket costs and expenses, that are actually Incurred by the Manager or its Affiliates on behalf of the Company in connection with performing Services hereunder, and all costs and expenses the reimbursement of which is specifically approved by the Board of Directors.

(b) Notwithstanding the foregoing or anything else to the contrary herein, neither the Company nor any Subsidiary of the Company shall be obligated or responsible for reimbursing or otherwise paying for any costs or expenses relating to the Manager's overhead or to the Manager’s conduct or maintenance of its business and operations as a provider of management services.

(c) Any such reimbursement shall be made upon demand by the Manager in U.S. dollars by wire transfer in immediately available funds to an account or accounts designated by the Manager from time to time.

ARTICLE VIII

TERMINATION; RESIGNATION AND REMOVAL OF THE MANAGER

Section 8.1 Resignation by the Manager. The Manager may resign at any time upon sixty (60) days’ prior written notice to the Company, which right shall not be contingent upon the finding of a replacement manager. However, if the Manager resigns, until the date on which the resignation becomes effective, the Manager shall, upon request of the Board of Directors, use reasonable efforts to assist the Board of Directors to find a replacement manager at no cost and expense to the Company.

Section 8.2 Removal of the Manager. The Manager may be removed by the Company at any time upon sixty (60) days’ prior written notice to the Manager, which right shall not be contingent upon the finding of a replacement manager.

Section 8.3 Termination. Subject to Section 12.4, this Agreement shall terminate upon the effective date of the resignation or removal of the Manager in accordance with Section 8.1 or Section 8.2 hereof.

Section 8.4 Directions. After a written notice of termination has been given under this Article VIII, the Company may direct the Manager to undertake any actions necessary to transfer any aspect of the ownership or control of the assets of the Company to the Company or to any nominee of the Company and to do all other things necessary to bring the appointment of the Manager to an end, and the Manager shall comply with all such reasonable directions. 1n addition, the Manager shall, at the Company’s expense, deliver to any new manager or the Company any books or records held by the Manager under this Agreement and shall execute and deliver such instruments and do such things as may reasonably be required to permit new management of the Company to effectively assume its responsibilities.

Section 8.5 Payments Upon Termination. Notwithstanding anything in this Agreement to the contrary, the fees, costs and expenses payable to the Manager pursuant to Article VII hereof shall be payable to the Manager upon, and with respect to, the termination of this Agreement pursuant to this Article VIII. All payments made pursuant to this Section 8.5 shall be made in accordance with Article VII hereof.

ARTICLE IX

INDEMNITY

The Company shall indemnify, reimburse, defend and hold harmless the Manager and its Affiliates and their respective successors and permitted assigns, together with their respective employees, officers, members, managers, directors, agents and representatives (collectively the “Indemnified Parties”), from and against all losses (including lost profits), costs, damages, injuries, taxes, penalties, interests, expenses, obligations, claims and liabilities joint or severable) of any kind or nature whatsoever (collectively “Losses”) that are Incurred by such Indemnified Parties in connection with, relating to or arising out of (i) the breach of any term or condition of this Agreement, or (ii) the performance of any Services hereunder; provided, however, that the Company shall not be obligated to indemnify, reimburse, defend or hold harmless any Indemnified Party for any Losses Incurred, by such Indemnified Party in connection with, relating to or arising out of: (a) a breach by such Indemnified Party of this Agreement; (b) the gross negligence, willful misconduct, bad faith or reckless disregard of such Indemnified Party in the performance of any Services hereunder; or (c) fraudulent or dishonest acts of such Indemnified Party with respect to the Company or any of its Subsidiaries.

The rights of any Indemnified Party referred to above shall be in addition to any rights that such Indemnified Party shall otherwise have at law or in equity.

Without the prior written consent of the Company, no Indemnified Party shall settle, compromise or consent to the entry of any judgment in, or otherwise seek to terminate any, claim, action, proceeding or investigation in respect of which indemnification could be sought hereunder unless (a) such Indemnified Party indemnifies the Company from any liabilities arising out of such claim, action, proceeding or investigation, (b) such settlement, compromise or consent includes an unconditional release of the Company and Indemnified Party from all liability arising out of such claim, action, proceeding or investigation and (c) the parties involved agree that the terms of such settlement, compromise or consent shall remain confidential.

ARTICLE X

LIMITATION OF LIABILITY OF THE MANAGER

Section 10.1 Limitation of Liability. The Manager shall not be liable for, and the Company shall not take, or permit to be taken, any action against the Manager to hold the Manager liable for, any error of judgment or mistake of law or for any loss suffered by the Company or its Subsidiaries (including, without limitation, by reason of the purchase, sale or retention of any security or assets) in connection with the performance of the Manager’s duties under this Agreement, except for a loss resulting from gross negligence, willful misconduct, bad faith or reckless disregard on the part of the Manager in the performance of its duties and obligations under this Agreement, or its fraudulent or dishonest acts with respect to the Company or any of its Subsidiaries.

Section 10.2 Reliance of Manager. The Manager may take and may act and rely upon:

(a) the opinion or advice of legal counsel, which may be in-house counsel to the Company or the Manager, any U.S.-based law firm, or other legal counsel reasonably acceptable to the Board of Directors, in relation to the interpretation of this Agreement or any other document (whether statutory or otherwise) or generally in connection with the Company;

(b) advice, opinions, statements or information from bankers, accountants, auditors,

(c) valuation consultants and other Persons consulted by the Manager who are in each case believed by the Manager in good faith to be expert in relation to the matters upon which they are consulted; and

(d) any other document provided to the Manager in connection with the Company upon which it is reasonable for the Manager to rely.

The Manager shall not be liable for anything done, suffered or omitted by it in good faith in reliance upon such opinion, advice, statement, information or document.

ARTICLE XI

LEGAL ACTIONS

The Manager shall notify the Company promptly of any claim made by any third party in relation to the assets of the Company ai1d shall send to the Company any notice, claim, summons or writ served on the Manager concerning the Company.

The Manager shall not, without the prior written consent of the Board of Directors, purport to accept or admit any claims or liabilities of which it receives notification on behalf of the Company or make any settlement or compromise with any third party in respect of the Company.

ARTICLE XII

MISCELLANEOUS

Section 12.1 Obligation of Good Faith; No Fiduciary Duties. The Manager shall perform its duties under this Agreement in good faith and for the benefit of the Company. The relationship of the Manager to the Company is as an independent contractor and nothing in this Agreement shall be construed to impose on the Manager any express or implied fiduciary duties.

Section 12.2 Binding Effect. This Agreement shall be binding upon, shall inure to the benefit of and be enforceable by the Parties hereto and their respective successors and permitted assigns.

Section 12.3 Compliance

(a) The Manager shall (and must ensure that each of its officers, agents and employees) comply with any law, including the Federal Securities Laws and the securities laws of any applicable jurisdiction, in each case, as in effect from time to time, to the extent that it concerns the functions of the Manager under this Agreement.

(b) The Manager shall maintain management systems, policies and internal controls and procedures that reasonably ensure that the Manager and its employees comply with the terms and conditions of this Agreement, as well as comply with the internal policies, controls and procedures established by the Company from time to time, including, without limitation, those relating to trading policies, conflicts of interest and similar corporate governance measures.

Section 12.4 Effect of Termination; Survival. This Agreement shall be effective as of the date first above written and shall continue in full force and effect thereafter until termination hereof in accordance with Article VIII. The obligations of the Company set forth in Articles VII, VIII and IX and Sections 10.1, 12.5, 12.7, 12.8, 12.9, 12.17 and 12.20 hereof shall survive such termination of this Agreement, subject to applicable law.

Section 12.5 Notices. Any notice or other communication required or permitted under this Agreement shall be deemed to have been duly given (a) five (5) Business Days following deposit in the mails if sent by registered or certified mail, postage prepaid, (b) when sent, if sent by facsimile transmission, if receipt thereof is confirmed by telephone, (c) when delivered, if delivered personally to the intended recipient and (d) two Business Days following deposit with a nationally recognized overnight courier service, in each case addressed as follows:

If to the Company, to:

1847 ICU HOLDINGS INC.

590 Madison Avenue

New York, NY 10022, 21^st Floor

Attn: Vernice L. Howard

Facsimile:

If to the Manager, to:

c/o The 1847 Companies LLC

590 Madison Avenue, 21^st Floor

New York, NY 10022

Attn: Ellery W. Roberts

Facsimile:

with a copy (which shall not constitute notice) to:

Bevilacqua PLLC

1050 Connecticut Ave., Suite 500

Washington, DC 20036

Attn: Louis A. Bevilacqua

Email:

Facsimile:

or to such other address or facsimile number as any such Party may, from time to time, designate in writing to all other Parties hereto, and any such communication shall be deemed to be given, made or served as of the date so delivered or, in the case of any communication delivered by mail, as of the date so received.

Section 12.6 Headings. The headings in this Agreement are included for convenience of reference only and in no way define or delimit any of the provisions hereof or otherwise affect their construction or effect.

Section 12.7 Applicable Law. This Agreement, the legal relations between and among the Parties and the adjudication and the enforcement thereof shall be governed by and interpreted and construed in accordance with the laws of the State of New York, without regard to the conflicts of law provisions thereof to the extent such principles or rules would require or permit the application of the laws of another jurisdiction.

Section 12.8 Submission to Jurisdiction; Waiver of Jury Trial. Subject to Section 12.20 hereof, each of the Parties hereby irrevocably acknowledges and agrees that any legal action or proceeding brought with respect to any of the obligations arising under or relating to this Agreement shall be brought only in the courts of the State of New York, County of New York or in the United States District Court for the Southern District of New York and each of the Parties hereby irrevocably submits to and accepts with regard to any such action or proceeding, for itself and in respect of its property, generally and unconditionally, the non-exclusive jurisdiction of the aforesaid courts. Each Party hereby further irrevocably waives any claim that any such courts lack jurisdiction over such Party, and agrees not to plead or claim, in any legal action or proceeding with respect to this Agreement or the transactions contemplated hereby brought in any of the aforesaid courts, that any such court lacks jurisdiction over such Party. Each Party irrevocably consents to the service of process in any such action or proceeding by the mailing of copies thereof by registered or certified mail, postage prepaid, to such party, at its address for notices set forth in Section 12.5 hereof, such service to become effective ten (10) days after such mailing. Each Party hereby irrevocably waives any objection to such service of process and further irrevocably waives and agrees not to plead or claim in any action or proceeding commenced hereunder or under any other documents contemplated hereby that service of process was in any way invalid or ineffective. The foregoing shall not limit the rights of any Party to serve process in any other manner permitted by applicable law. The foregoing consents to jurisdiction shall not constitute general consents to service of process in the State of New York for any purpose except as provided above and shall not be deemed to confer rights on any Person other than the respective Parties.

Each of the Parties hereby waives any right it may have under the laws of any jurisdiction to commence by publication any legal action or proceeding with respect this Agreement. To the fullest extent permitted by applicable law, each of the Parties hereby irrevocably waives the objection which it may now or hereafter have to the laying of the venue of any suit, action or proceeding arising out of or relating to this Agreement in any of the courts referred to in this Section 12.8 and hereby further irrevocably waives and agrees not to plead or claim that any such court is not a convenient forum for any such suit, action or proceeding.

The Parties agree that any judgment obtained by any Party or its successors or assigns in any action, suit or proceeding referred to above may, in the discretion of such Party (or its successors or assigns), be enforced in any jurisdiction, to the extent permitted by applicable law.

The Parties agree that the remedy at law for any breach of this Agreement may be inadequate and that should any dispute arise concerning any matter hereunder, this Agreement shall be enforceable in a court of equity by an injunction or a decree of specific performance. Such remedies shall, however, be cumulative and nonexclusive, and shall be in addition to any other remedies which the Parties may have.

Each Party hereby waives, to the fullest extent permitted by applicable law, any right it may have to a trial by jury in respect of any litigation as between the Parties directly or indirectly arising out of, under or in connection with this Agreement or the transactions contemplated hereby or disputes relating hereto. Each Party (a) certifies that no representative, agent or attorney of any other Party has represented, expressly or otherwise, that such other Party would not, in the event of litigation, seek to enforce the foregoing waiver and (b) acknowledges that it and the other Parties have been induced to enter into this Agreement by, among other things, the mutual waivers and certifications in this Section 12.8.

Section 12.9 Amendment; Waivers. No term or condition of this Agreement may be amended, modified or waived without the prior written consent of the Party against whom such amendment, modification or waiver will be enforced. Any waiver granted hereunder shall be deemed a specific waiver relating only to the specific event giving rise to such waiver and not as a general waiver of any term or condition hereof.

Section 12.10 Remedies to Prevailing Party. If any action at law or equity is necessary to enforce or interpret the terms of this Agreement, the prevailing party shall be entitled to reasonable attorneys’ fees, costs, and necessary disbursements in addition to any other relief to which such party may be entitled.

Section 12.11 Severability. Each provision of this Agreement is intended to be severable from the others so that if, any provision or term hereof is illegal, invalid or unenforceable for any reason whatsoever, such illegality, invalidity or unenforceability shall not affect or impair the validity of the remaining provisions and terms hereof; provided, however, that the provisions governing payment of the Management Fee described in Article VII hereof are not severable.

Section 12.12 Benefits Only to Parties. Nothing expressed by or mentioned in this Agreement is intended or shall be construed to give any Person, other than the Parties and their respective successors or permitted assigns and the Indemnified Parties, any legal or equitable right, remedy or claim under or in respect of this Agreement or any provision herein contained, terms Agreement and all conditions and provisions hereof being intended to be and being for the sole and exclusive benefit of the Parties and their respective successors and permitted assigns, and for the benefit of no other Person.

Section 12.13 Further Assurances. Each Party hereto shall take any and all such actions, and execute and deliver such further agreements, consents, instruments and any other documents as may be necessary from time to time to give effect to the provisions and purposes of this Agreement.

Section 12.14 No Strict Construction. The Parties have participated jointly in the negotiation and drafting of this Agreement. In the event any ambiguity or question of intent or interpretation arises, this Agreement shall be construed as if drafted jointly by all Parties, and no presumption or burden of proof shall arise favoring or disfavoring any Party by virtue of the authorship of any provision of this Agreement.

Section 12.15 Entire Agreement. This Agreement constitutes the sole and entire agreement of the Parties with regards to the subject matter of this Agreement. Any written or oral agreements, statements, promises, negotiations or representations not expressly set fo1ih in this Agreement are of no force and effect.

Section 12.16 Assignment. This Agreement shall not be assignable by either party except by the Manager to any Person with which the Manager may merge or consolidate or to which the Manager transfers substantially all of its assets, and then only in the event that such assignee assumes all of the obligations to the Company and the Subsidiaries of the Company hereunder.

Section 12.17 Confidentiality

(a) The Manager shall not, and the Manager shall cause its Affiliates and their respective agents and representatives not to, at any time from and after the date of this Agreement, directly or indirectly, disclose or use any confidential or proprietary information, including Company Information, involving or relating to (x) the Company, including any information contained in the books and records of the Company and (y) the Subsidiaries of the Company, including any information contained in the books and records of any such Subsidiaries; provided, however, that disclosure and use of any information shall be permitted (i) with the prior written consent of the Company, (ii) as, and to the extent, expressly permitted by this Agreement or any other agreement between the Manager and the Company or any of the Company’s Subsidiaries (but only to the extent that such information relates to such Subsidiaries), (iii) as, and solely to the extent, necessary or required for the performance by the Manager, any of its Affiliates or its delegates, of any of their respective obligations under this Agreement, (iv) as, and to the extent, necessary or required in the operation of the Company's business or operations in the Ordinary Course of Business, (v) to the extent such information is generally available to, or known by, the public or otherwise has entered the public domain (other than as a result of disclosure in violation of this Section 12.17 by the Manager or any of its Affiliates), (vi) as, and to the extent, necessary or required by any governmental order, applicable law or any governmental authority, subject to Section 12.17(d), and (vii) as, and to the extent, necessary or required or reasonably appropriate in connection with the enforcement of any right or remedy relating to this Agreement or any other agreement between the Manager and the Company or any of the Company’s Subsidiaries.

(b) The Manager shall produce and implement policies and procedures that are reasonably designed to ensure compliance by the Manager’s directors, officers, employees, agents and representatives with the requirements of this Section 12.17.

(c) For the avoidance of doubt, confidential information includes business plans, financial information, operational information, strategic information, legal strategies or legal analysis, formulas, production processes, lists, names, research, marketing, sales information and any other information similar to any of the foregoing or serving a purpose similar to any of the foregoing with respect to the business or operations of the Company or any of its Subsidiaries. However, the Parties are not required to mark or otherwise designate information as “confidential or proprietary information,” “confidential” or “proprietary” in order to receive the benefits of this Section 12.17.

(d) In the event that the Manager is required by governmental order, applicable law or any governmental authority to disclose any confidential information of the Company or any of its Subsidiaries that is subject to the restrictions of this Section 12.17, the Manager shall (i) notify the Company or any of its Subsidiaries in writing as soon as possible, unless it is otherwise affirmatively prohibited by such governmental order, applicable law or such governmental authority from notifying the Company or any such Subsidiaries, as the case may be, (ii) cooperate with the Company or any such Subsidiaries to preserve the confidentiality of such confidential information consistent with the requirements of such governmental order, applicable law or such governmental authority and (iii) use its reasonable best efforts to limit any such disclosure to the minimum disclosure necessary or required to comply with such governmental order, applicable law or such governmental authority, in each case, at the cost and expense of the Company.

(e) Nothing in this Section 12.17 shall prohibit the Manager from keeping or maintaining any copies of any records, documents or other information that may contain information that is otherwise subject to the requirements of this Section 12.17, subject to its compliance with this Section 12.17.

(f) The Manager shall be responsible for any breach or violation of the requirements of this Section 12.17 by any of its agents or representatives.

Section 12.18 Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original, but all of which together shall constitute but one and the same instrument.

Section 12.19 Designation. This Agreement is an “Offsetting Management Services Agreement” as such term is defined and used pursuant to the Parent MSA, and the Management Fee is an “Offsetting Management Fee” as such term is defined and used pursuant to the Parent MSA.

Section 12.20 Dispute Resolution. All disputes arising out of this Agreement or relating to the performance of either Party of its obligations hereunder, which disputes the Parties are unable to resolve directly between themselves, shall be settled by arbitration in New York, New York (unless the Company and the Manager agree upon another location) before three arbitrators in accordance with the rules then in effect of the American Arbitration Association.

[Remainder of page intentionally left blank]

IN WITNESS WHEREOF, the Parties have executed this Agreement as of the date first set forth above.

[Signature Page to Management Services Agreement]

Exhibit 10.8

Execution Version

LOAN AND SECURITY AGREEMENT

by and between

INDUSTRIAL FUNDING GROUP, INC.

as Lender

and

1847 ICU HOLDINGS INC.,

ICU EYEWEAR, INC.,

ICU EYEWEAR HOLDINGS, INC.,

jointly and severally

as Borrower

Dated: February 9, 2023

LOAN AND SECURITY AGREEMENT

LOAN AND SECURITY AGREEMENT (as the same may be amended, supplemented, restated, or otherwise modified from time to time, the “Agreement”), dated as of February 9, 2023, by and between 1847 ICU HOLDINGS INC., a Delaware corporation with a principal place of business located at 590 Madison Avenue, New York, NY 10022, ICU EYEWEAR, INC., a California corporation with a principal place of business located at 1900 Shelton Drive, Hollister, CA 95023, and ICU EYEWEAR HOLDINGS, INC., a California corporation with a principal place of business located at 1900 Shelton Drive, Hollister, CA 95023, jointly and severally (“Borrower”) and INDUSTRIAL FUNDING GROUP, INC., a California corporation with offices at 13848 Ventura Blvd., Sherman Oaks, CA 91423 (together with its successors and assigns, the “Lender”).

R E C I T A L S:

WHEREAS, 1847 ICU Holdings Inc., as buyer (the “Buyer”), 1847 ICU Acquisition Sub Inc., as merger sub (the “Merger Sub”), ICU Eyewear Holdings, Inc. (the “Company”), and San Francisco Equity Partners, as stockholder representative, entered into that certain Agreement and Plan of Merger, dated as of December 21, 2022 (the “Merger Agreement”) pursuant to which the Merger Sub will merge with and into the Company, with the Company and ICU Eyewear, Inc. surviving as direct wholly-owned subsidiaries of Buyer on the terms contained in the Merger Agreement (the “Merger Transaction”);

WHEREAS, the Merger Transaction is being consummated concurrently with the execution and delivery of this Agreement;

WHEREAS, Borrower desires to enter into a revolving loan credit facility with Lender; and

WHEREAS, Lender is willing to establish such credit facility on the terms and conditions hereinafter set forth;

NOW, THEREFORE, in consideration of the foregoing, the mutual covenants and agreements herein contained and other good and valuable consideration, Lender and Borrower mutually covenant, warrant and agree as follows:

SECTION 1. DEFINITIONS AND RULES OF INTERPRETATION AND CONSTRUCTION

Specific Terms Defined. Capitalized terms used herein and not otherwise defined have the following meanings:

1.1 “1847 Side Letter” shall mean the Side Letter dated of even date herewith, signed and delivered by 1847 Holdings, Inc., a Delaware corporation, and acknowledged by Borrower.

1.2 “Account Debtor” or “account debtor” means “account debtor”, as defined in Article 9 of the UCC, and any other obligor in respect of an Account.

1.3 “Accounts” or “accounts” shall mean “accounts” as defined in the UCC, and, in addition, any and all obligations of any kind at any time due and/or owing to Borrower, whether now existing or hereafter arising, and all rights of Borrower to receive payment or any other consideration including, without limitation, invoices, contract rights, accounts receivable, general intangibles, choses-in-action, notes, drafts, acceptances, instruments and all other debts, obligations and liabilities in whatever form owing to Borrower from any Person, Governmental Authority or any other entity, all security therefor, and all of Borrower’s rights to receive payments for goods sold (whether delivered, undelivered, in transit or returned) or services rendered (whether or not earned by performance), which may be represented thereby, or with respect thereto, and all security therefor, including, but not limited to, all rights as an unpaid vendor (including stoppage in transit, replevin or reclamation), all rights of enforcement and collection, and all additional amounts due from any Account Debtor, whether or not invoiced, together with all Proceeds and products of any and all of the foregoing.

1.4 “ACH” shall have the meaning set forth in Section 2.5 hereof.

1.5 “Additional Appraisals” shall have the meaning set forth in Section 13.9 hereof.

1.6 “Advance” shall have the meaning as set forth in Section 1(c)(ii) of the Loan Agreement Schedule.

1.7 “Affiliate” shall mean, with respect to any Person, (a) any other Person that, directly or indirectly, controls, is controlled by, or is under common control with such Person, including any Subsidiary, or (b) any other Person who is a director, manager or officer or who functions in a similar role) (i) of such Person, (ii) of any Subsidiary of such Person or (iii) of any Person described in clause (a) above. For the purposes of this definition, control of a Person shall mean the power (direct or indirect) to direct or cause the direction of the management or the policies of such Person, whether through the ownership of any voting securities, by contract or otherwise.

1.8 “Agreement” shall mean this Loan and Security Agreement (including the Loan Agreement Schedule, all Exhibits annexed hereto and the Borrower’s Disclosure Schedule) as originally executed or, if amended, modified, supplemented, renewed or extended from time to time, as so amended, modified, supplemented, renewed or extended.

1.9 “Appraisals” shall mean the Inventory Appraisal.

1.10 “Appraised Net Orderly Liquidation Value” shall mean a professional opinion of the estimated most probable net amount expressed in terms of currency which could typically be realized when assets are sold piecemeal, through negotiation, over a predetermined period of time by an experienced liquidator and under present day economic trends, as of the effective date of the appraisal report after all direct sale expenses have been deducted. Orderly liquidation value assumes that the buyer is responsible for all removal costs and is purchasing the assets “as is, where is’” with no warrantees or representations as to the condition of the assets being made by the seller. It is further assumed that the assets are properly advertised in a manner considered to be commercially reasonable. Buyer and seller further acknowledge that if an acceptable price cannot be negotiated within the time period specified the final option would be to offer the assets for sale at public auction. Not considered in the sale expenses are attorney fees, building repairs, maintenance, etc. that are not under the liquidator’s control. Conclusions taken into consideration are physical location, difficulty of removal, physical condition, adaptability, specialization, marketability, overall appearance and psychological appeal. Further, the ability of the asset group to draw sufficient prospective buyers to ensure competitive offers is considered. The licensed and experienced liquidator is assuming in their evaluation that all equipment will be free of hazardous waste at the time of sale.

1.11 “Availability” shall mean, as of any date of determination, the lesser of (i) the Borrowing Base (as set forth in the most recently delivered Borrowing Certificate), and (ii) Five Million Dollars ($5,000,000.00).

1.12 “Bailee Waivers” means the Bailee Waiver Agreement with each bailee of Borrower as originally executed or, if amended, modified, supplemented, renewed, extended or replaced from time to time, as so amended, modified, supplemented, renewed, extended or replaced.

1.13 “Balance Sheet” means the balance sheet of Borrower dated as of the Balance Sheet Date.

1.14 “Balance Sheet Date” means December 31, 2022.

1.15 “Bankruptcy Code” means Title 11 of the United States Code entitled “Bankruptcy”, as the same may be amended, modified or supplemented from time to time, and any successor statute thereto.

1.16 “Borrower” has the meaning set forth in the introductory paragraph hereof.

1.17 “Borrower’s Disclosure Schedule” means the disclosure schedule prepared by Borrower that is being delivered to Lender concurrently herewith or, if amended, modified, supplemented, renewed, extended or replaced from time to time, as so amended, modified, supplemented, renewed, extended or replaced.

1.18 “Borrower’s Premises” means the property leased by the Borrower located at 1900 Shelton Drive, Hollister, CA 95023 and at 1401 Los Gamos, Suite 103, San Rafael, CA 94903.

1.19 “Borrowing Base” shall be calculated at any time as the sum of (A) the product obtained by multiplying the outstanding amount of all Eligible Accounts, net of all Taxes, discounts, allowances and credits given or claimed, by up to eighty percent (80.00%), plus (B) the lesser of (i) the product obtained by multiplying the Net Liquidation Value of then-existing Eligible Inventory by seventy percent (70%), and (ii) the product obtained by multiplying the Cost of then-existing Eligible Inventory by fifty percent (50%).

1.20 “Borrowing Certificate” shall have the meaning as set forth in Section 1(c)(v) of the Loan Agreement Schedule.

1.21 “Business” means manufacturing and selling retail sunglasses and reading glasses.

1.22 “Business Day” shall mean any day other than a Saturday, Sunday or any other day on which banks located in the State of Texas are authorized or required to close under applicable banking laws.

1.23 “Capital Assets” shall mean, in accordance with GAAP, fixed assets, both tangible (such as land, buildings, fixtures, machinery and equipment) and intangible (such as patents, copyrights, trademarks, franchises and goodwill).

1.24 “Change of Control” shall have the meaning as set forth in Section 10.1 hereof.

1.25 “Chattel Paper” shall have the meaning ascribed to such term in the UCC.

1.26 “Closing Date” shall mean the date of this Agreement.

1.27 “Collateral” shall have the meaning as set forth in Section 5.1 hereof.

1.28 “Collection Account” has the meaning set forth in Section 1(c)(vi) of the Loan Agreement Schedule.

1.29 “Collection Days” shall mean a period equal to the greater of (i) two (2) Business Days after the deposit of Collections into the Collection Account, or (ii) such longer period as may be required by the financial institution with whom the Collection Account is maintained, in either event for which interest may be charged on the aggregate amount of such deposits at the Interest Rate or, if applicable, the Default Interest Rate.

1.30 “Collections” means with respect to any Account, all cash collections on such Account.

1.31 “Commercial Tort Claims” shall have the meaning ascribed to such term in the UCC.

1.32 “Compliance Certificate” has the meaning set forth in Section 7(b)(v) of the Loan Agreement Schedule.

1.33 “Cost” means the lower of Borrower’s actual cost of Eligible Inventory, as verified by Lender.

1.34 “Default” means any condition or event which with the giving of notice or passage of time or both would, unless cured or waived, become an Event of Default.

1.35 “Default Interest Rate” has the meaning set forth in Section 3(b) of the Loan Agreement Schedule.

1.36 “Deposit Account Control Agreement” means any deposit account control agreement with respect to any Account of Borrower as originally executed or, if amended, modified, supplemented, renewed, extended or replaced from time to time, as so amended, modified, supplemented, renewed, extended or replaced.

1.37 “Deposit Accounts” shall have the meaning ascribed to such term in the UCC.

1.38 “Document” or “document” shall have the meaning ascribed to such term in the UCC.

1.39 “Domain Name, URL and IP Address Assignment” means the Domain Name, URL and IP Address Assignment in form and substance acceptable to Lender as originally executed or, if amended, modified, supplemented, renewed, extended or replaced from time to time, as so amended, modified, supplemented, renewed, extended or replaced.

1.40 “Electronic Chattel Paper” shall have the meaning ascribed to such term in the UCC.

1.41 “Eligible Accounts” means, subject to the criteria below, an Account of a Borrower, which was generated in the Ordinary Course of Business, which was generated originally in the name of a Borrower and not acquired via assignment or otherwise, and which Lender, in its good faith credit judgment and discretion, deems to be an Eligible Account. The net amount of an Eligible Account at any time shall be (a) the face amount of such Eligible Account as originally billed minus all cash collections and other proceeds of such Account received from or on behalf of the Account Debtor thereunder as of such date and any and all returns, rebates, discounts (which may, at Lender’s option, be calculated on shortest terms), credits, allowances or excise taxes of any nature at any time issued, owing, claimed by Account Debtors, granted, outstanding or payable in connection with such Accounts at such time, and (b) adjusted by applying percentages (known as “liquidity factors”) by payor and/or payor class based upon the applicable Borrower’s actual recent collection history for each such payor and/or payor class in a manner consistent with Lender’s underwriting practices and procedures. Such liquidity factors may be adjusted by Lender from time to time as warranted by Lender’s underwriting practices and procedures and using Lender’s good faith credit judgment. Without limiting the generality of the foregoing, no Account shall be an Eligible Account if:

(1) the Account arises from the sale of goods, the sale was not an absolute, bona fide sale, or the Account does not otherwise represent an undisputed bona fide indebtedness incurred by the Account Debtor therein named, for a fixed sum as set forth in the invoice relating thereto with respect to an unconditional sale and delivery upon the stated terms of goods sold by the Borrower collectible in accordance with its terms;

(2) the Account arises from the sale of goods, any part of any goods the sale of which has given rise to the Account has been returned, rejected, lost, or damaged (but only to the extent that such goods have been so returned, rejected, lost or damaged);

(3) the amounts of the Accounts reported to Lender are not absolutely owing to Borrower and/or arise from sales on consignment, guaranteed sales or other terms under which payment by the Account Debtors may be conditional or contingent;

(4) the Account arises from the performance of services, the services have not actually been performed or the services were undertaken in violation of any law;

(5) the Account Debtor’s chief executive office or principal place of business is not located in the United States;

(6) the Account is payable in a currency other than United States dollars;

(5) such Accounts arise from progress billings, retainages or bill and hold sales;

(6) there are contra relationships, setoffs, counterclaims or disputes existing with respect thereto;

(7) the Inventory giving rise thereto are subject to any Liens except for the Liens of Lender;

(8) such Accounts are not free and clear of all Liens except for the Liens of Lender;

(9) such Accounts are Accounts with respect to which the Account Debtor or any officer or employee thereof is an officer, employee or agent of or is affiliated with Borrower, directly or indirectly, whether by virtue of family membership, ownership, control, management or otherwise, or if the Account Debtor holds any Indebtedness of Borrower;

(10) such Accounts are Accounts with respect to which the Account Debtor is the United States or any state or political subdivision thereof or any department, agency or instrumentality of the United States, any state or political subdivision;

(11) Borrower has not delivered to Lender or Lender’s representative such documents as Lender may have requested in connection with such Accounts and Lender has not received a verification of such Accounts, satisfactory to it, if sent to the Account Debtor or any other obligor or any bailee;

(12) there are any facts existing or threatened which might result in any material adverse change in the Account Debtor’s financial condition;

(13) such Accounts are owed by an Account Debtor with respect to which more than 25% of such Account Debtor’s Accounts have remained unpaid for more than ninety (90) days after the invoice date thereof;

(14) such Accounts have remained unpaid for more than ninety (90) days after the invoice date thereof;

(15) such Accounts are not in full conformity with the representations and warranties made by Borrower to Lender with respect thereto;

(16) Lender is not reasonably satisfied with the credit standing of the Account Debtor in relation to the amount of credit extended;

(17) such Accounts are evidenced by chattel paper or an instrument of any kind with respect to or in payment of the Account unless such instrument is duly endorsed to and in possession of Lender or represents a check in payment of an account;

(18) such Accounts include any returns, discounts, claims, credits and allowances;

(19) Borrower is unable to bring suit and enforce its remedies against the Account Debtor through judicial process;

(20) such Accounts represent interest payments, late or finance charges owing to Borrower;

(21) if the Account Debtor is Target Corporation (or any Affiliate or subsidiary of Target Corporation);

(21) the total unpaid Accounts of the Account Debtor, in the aggregate, obligated on the Account exceed twenty percent (20%) of the net amount of all Eligible Accounts owing from all Account Debtors (but only the amount of the Accounts of such Account Debtor exceeding such twenty percent (20%) limitation shall be considered ineligible); and

(22) such Accounts are in any way otherwise unsatisfactory to Lender in its sole discretion.

1.42 “Eligible Inventory” shall mean Inventory consisting solely of finished goods inventory owned by Borrower, with the existence, possession and Cost thereof evidenced by documentation provided by Borrower in form and substance satisfactory to Lender, excluding any Inventory having any of the following characteristics:

(1) Inventory that is either work-in-process or raw materials;

(2) Inventory packaging materials, office supplies or cleaning supplies;

(3) In-transit Inventory;

(4) Inventory as to which Lender has not received a waiver in form and substance acceptable to Lender from the applicable landlord, warehouseman, filler, processor or packer in respect thereof;

(5) Inventory not subject to a duly perfected first priority security interest in Lender’s favor;

(6) Inventory that is subject to any Lien in favor of any Person other than Lender that is not subordinate to Lender’s first priority security interest on terms satisfactory to Lender in its sole and absolute discretion;

(7) Inventory on consignment from any Person, on consignment to any Person or subject to any bailment, including, but not limited to, any Inventory available for sale at any Target Corporation store;

(8) Inventory that is (i) damaged, defective, or tainted, (ii) slow-moving as determined in Lender’s sole and absolute discretion, (iii) obsolete or not currently saleable in the normal course of the Borrower’s operations, or (iv) subject to shrinkage;

(9) Inventory that the Borrower has returned, has attempted to return, is in the process of returning or intends to return to the vendor thereof;

(10) Inventory manufactured or produced by the Borrower pursuant to a license unless the applicable licensor has agreed in writing to permit the Lender to exercise its rights and remedies against such Inventory;

(11) Inventory not covered by a casualty insurance policy acceptable to Lender in its sole and absolute discretion and under which Lender has been named as a loss payee and additional insured;

(12) Inventory with contra-account liability;

(13) Inventory that is located at any warehouse or other premises other than (a) Borrower’s Premises, or (b) any other premises expressly approved by Lender in writing; and

(14) Inventory otherwise deemed ineligible by Lender in its sole and absolute discretion.

1.43 “Environment” means all air, surface water, groundwater or land, including, without limitation, land surface or subsurface, including, without limitation, all fish, wildlife, biota and all other natural resources.

1.44 “Environmental Law” or “Environmental Laws” shall mean all federal, state and local laws, statutes, ordinances and regulations now or hereafter in effect, and in each case as amended or supplemented from time to time, and any judicial or administrative interpretation thereof, including any judicial or administrative order, consent decree or judgment relating to the regulation and protection of human health, safety, the environment and natural resources (including ambient air, surface water, groundwater, wetlands, land surface or subsurface strata, wildlife, aquatic species and vegetation).

1.45 “Environmental Liabilities and Costs” shall mean, as to any Person, all liabilities, obligations, responsibilities, remedial actions, losses, damages, punitive damages, consequential damages, treble damages, costs and expenses (including all fees, disbursements and expenses of counsel, experts and consultants and costs of investigation and feasibility studies), fines, penalties, sanctions and interest incurred as a result of any claim or demand by any other Person, whether based in contract, tort, implied or express warranty, strict liability, criminal or civil statute, including any Environmental Law, permit, order or agreement with any Governmental Authority or other Person, and which arise from any environmental, health or safety conditions, or a Release or conditions that are reasonably likely to result in a Release, and result from the past, present or future operations of such Person or any of its Affiliates.

1.46 “Environmental Lien” shall mean any Lien in favor of any Governmental Authority for Environmental Liabilities and Costs.

1.47 “ERISA” shall mean the Employee Retirement Income Security Act of 1974, as the same now exists or may from time to time hereafter be amended, modified, recodified or supplemented, together with all rules, regulations and interpretations thereunder or related thereto.

1.48 “Equipment” shall mean “equipment”, as such term is defined in the UCC, now owned or hereafter acquired by Borrower, wherever located, and shall include, without limitation, the machinery and equipment set forth on Section 5.4(j) to the Borrower’s Disclosure Schedule annexed hereto, and all other equipment, machinery, furniture, Fixtures, computer equipment, telephone equipment, molds, tools, dies, partitions, tooling, transportation equipment, all other tangible assets used in connection with the manufacture, sale or lease of goods or rendition of services, and Borrower’s interests in any leased equipment, and all repairs, modifications, alterations, additions, controls and operating accessories, attachments and parts thereof or thereto, and all substitutions and replacements therefor.

1.49 “Equity Interests” shall mean, with respect to any Person, any and all shares, rights to purchase, options, warrants, general, limited or limited liability partnership interests, membership interests, units, participations or other equivalents of or interest in (regardless of how designated) equity of such Person, whether voting or nonvoting, including common stock, preferred stock, convertible securities or any other “equity security” (as such term is defined in Rule 3a11-1 of the General Rules and Regulations promulgated by the SEC (or any successor thereto) under the 1934 Act).

1.50 “Event of Default” shall mean the occurrence or existence of any event or condition described in Section 11 of this Agreement.

1.51 “Financial Statements” shall have the meaning set forth in Section 8.9 hereof.

1.52 “Financing Statements” shall mean the Uniform Commercial Code UCC Financing Statements and Uniform Commercial Code UCC Financing Statement Amendments to be filed with applicable Governmental Authorities of each State or Commonwealth or political subdivisions thereof pursuant to which Lender shall perfect its security interest in the Collateral.

1.53 “Fiscal Year” shall mean that twelve (12) month period commencing on January 1 and ending on December 31.

1.54 “Fixtures” shall have the meaning ascribed to such term in the UCC.

1.55 “GAAP” means generally accepted accounting principles in effect in the United States of America at the time of any determination, and which are applied on a consistent basis. All accounting terms used in this Agreement which are not expressly defined in this Agreement shall have the meanings given to those terms by GAAP, unless the context of this Agreement otherwise requires.

1.56 “General Intangibles” shall have the meaning ascribed to such term in the UCC.

1.57 “Goods” shall have the meaning ascribed to such term in the UCC.

1.58 “Governmental Authority” or “Governmental Authorities” shall mean any federal, state, county or municipal governmental agency, court, tribunal, department, instrumentality, board, commission, officer, official or entity exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to government.

1.59 “Hazardous Substances” shall mean (a) substances that are defined or listed in, or otherwise classified pursuant to, any applicable laws or regulations as “hazardous substances,” “hazardous materials,” “hazardous wastes,” “toxic substances,” or any other formulation intended to define, list, or classify substances by reason of deleterious properties such as ignitability, corrosivity, reactivity, carcinogenicity, reproductive toxicity, or “EP toxicity,” (b) oil, petroleum, or petroleum derived substances, natural gas, natural gas liquids, synthetic gas, drilling fluids, produced waters, and other wastes associated with the exploration, development, or production of crude oil, natural gas, or geothermal resources, (c) any flammable substances or explosives or any radioactive materials, and (d) asbestos in any form or electrical equipment that contains any oil or dielectric fluid containing levels of polychlorinated biphenyls in excess of 50 parts per million.

1.60 “Indebtedness” shall mean, with respect to any Person, all of the obligations of such Person which, in accordance with GAAP, should be classified upon such Person’s balance sheet as liabilities, or to which reference should be made by footnotes thereto, including without limitation, with respect to Borrower, in any event and whether or not so classified, including the following:

(a) all debt and similar monetary obligations of a Person, whether direct or indirect;

(b) all obligations of a Person arising or incurred under or in respect of any guaranties (whether direct or indirect) of such Person with respect to the indebtedness of any other Person; and

(c) all obligations of a Person arising or incurred under or in respect of any Lien upon or in any property owned by Borrower that secures indebtedness of another Person, even though such Person has not assumed or become liable for the payment of such indebtedness.

1.61 “Instruments” shall have the meaning ascribed to such term in the UCC.

1.62 “Intellectual Property” shall mean all of the following intellectual property used in the conduct of the business of Borrower:: (a) inventions, processes, techniques, discoveries, developments and related improvements, whether or not patentable; (b) United States patents, patent applications, divisionals, continuations, reissues, renewals, registrations, confirmations, re-examinations, extensions and any provisional applications, of any such patents or patent applications, and any foreign or international equivalent of any of the foregoing; (c) unregistered, United States registered or pending trademark, trade dress, service mark, service name, trade name, brand name, logo, domain name, or business symbol and any foreign or international equivalent of any of the foregoing; (d) work specifications, software (including object and source code listing) and artwork; (e) technical, scientific and other know-how and information, trade secrets, methods, processes, practices, formulas, designs, assembly procedures, specifications owned or used by Borrower; (f) copyrights; (g) work for hire; (h) customer and mailing lists; (i) any and all rights of the Borrower to the name “Cable Car Eyewear”, “ICU Eyewear” or any derivations thereof; (j) Borrower’s entire customer list and database and all assets used or useful by Borrower in the conduct of its Business over the internet or in any electronic medium; (k) all websites, IP addresses, URLs or domain names owned by Borrower; (l), the patents, trademarks, websites, IP addresses, URLs, domain names and such other items set forth on Section 8.22 to the Borrower’s Disclosure Schedule; and (m) all goodwill associated with the items described in (a) through and including (l).

1.63 “Interest Rate” shall mean the Revolving Loan Interest Rate(s).

1.64 “Intercreditor Agreements” shall mean the Subordination Agreement between Lender and each Subordinated Creditor.

1.65 “Inventory” shall mean “inventory” as such term is defined in the UCC, now owned or hereafter acquired by Borrower, wherever located, and, in any event, shall include, without limitation, all raw materials, work-in-process, finished and semi-finished Inventory including, without limitation, all materials, parts, components and supplies relating to the manufacture or assembly thereof, packaging and shipping supplies relating thereto, and all other inventory, merchandise, goods and other personal property now or hereafter owned by Borrower, which are held for sale, exchange or lease or are furnished or are to be furnished under a contract of service or an exchange arrangement or which constitute raw materials, work-in-process or materials used or consumed or to be used or consumed in Borrower’s business, or the processing, packaging, delivery or shipping of the same, and all finished goods and the products of the foregoing, whatever form and wherever located; and all names or marks affixed to or to be affixed thereto for purposes of selling same by the seller, manufacturer, lessor or licensor thereof and all right, title and interest of Borrower therein and thereto.

1.66 “Inventory Appraisal” means the appraisal of the Inventory performed by Lender prior to the Closing Date.

1.67 “Investment Property” shall have the meaning ascribed to such term in the UCC.

1.68 “Landlord Waiver and Access Agreements” means the Landlord Waiver and Access Agreement with each landlord of Borrower as originally executed or, if amended, modified, supplemented, renewed, extended or replaced from time to time, as so amended, modified, supplemented, renewed, extended or replaced.

1.69 “Lender” shall have the meaning set forth in the introductory paragraph hereof.

1.70 “Letter-of-Credit Rights” means “letter-of-credit rights” as such term is defined in the UCC, including rights to payment or performance under a letter of credit, whether or not the beneficiary thereof has demanded or is entitled to demand payment or performance.

1.71 “Lien” or “lien” shall mean any mortgage, deed of trust, pledge, security interest, hypothecation, assignment, lien (statutory or other, including, without limitation, liens imposed by any Governmental Authority, whether arising under PACA, if applicable, or otherwise), charge or other encumbrance of any kind or nature whatsoever (including, without limitation, pursuant to any conditional sale or other title retention agreement, any financing lease having substantially the same economic effect as any of the foregoing, and the filing of any financing statement under the UCC or comparable law of any jurisdiction to evidence any of the foregoing) on personal or real property or fixtures.

1.72 “Loan(s)” shall mean the aggregate principal amount(s) advanced to, made available to, or paid for the benefit of, Borrower as Revolving Loans as set forth in this Agreement and the other Loan Documents.

1.73 “Loan Agreement Schedule” shall mean the Loan Agreement Schedule dated of even date herewith, signed by Borrower and delivered together with this Agreement, which Loan Agreement Schedule is incorporated herein by reference.

1.74 “Loan Documents” shall mean this Agreement and any and all other agreements, notes, documents, mortgages, financing statements, guaranties, intercreditor agreements, subordination agreements, certificates and instruments executed and/or delivered by Borrower or any other Person to Lender pursuant to and in connection with the Loan(s) and this Agreement, including, without limitation, the Revolving Loan Note, the Intercreditor Agreements, the Landlord Waivers, the Domain Name, URL and IP Address Assignment, the Patent and Trademark Security Agreement, 1847 Side Letter, and the Power of Attorney.

1.75 “Material Adverse Effect” means a material adverse effect on (a) the Business, assets, liabilities, financial condition, results of operations or business prospects of Borrower, (b) the ability of Borrower to perform its obligations under any Loan Document to which it is a party, (c) the value of the Collateral or the rights of Lender therein, (d) the validity or enforceability of any of the Loan Documents, (e) the rights and remedies of Lender under any of such Loan Documents, or (f) the timely payment of the principal of or interest on the Loan(s) or other amounts payable in connection therewith. All determinations of materiality shall be made by the Lender in its reasonable judgment.

1.76 “Material Contract” means any contract or other arrangement (other than Loan Documents), whether written or oral, to which Borrower is a party as to which the breach, nonperformance, cancellation or failure to renew by any party thereto could have a Material Adverse Effect.

1.77 “Maturity Date” shall mean the earlier of (i) February 9, 2025, and (ii) the date Lender may exercise any of its remedies pursuant to the terms hereof.

1.78 “Maximum Credit” means up to Five Million Dollars ($5,000,000.00) subject to Availability, the Inventory Appraisal or the Additional Appraisals, as applicable, any Reserves and the Revolving Loan Commitment.

1.79 “Merger Transaction” has the meaning set forth in the Recitals hereof.

1.80 “Net Liquidation Value” shall mean the lesser of (i) the term ‘Net Orderly Liquidation Value’ as set forth in the Inventory Appraisal, and (ii) the estimated net dollar amount recovery as estimated by Lender which could be realized at a public auction sale of the Inventory conducted on an “as is” basis after all costs and expenses associated with the sale (including, without limitation, rent payments, removal costs, repair and broom cleaning of premises, liquidator fees and expenses and other charges related to such liquidation).

1.81 “1934 Act” shall mean the Securities Exchange Act of 1934, as amended.

1.82 “Notes” shall mean the Revolving Loan Note.

1.83 “Obligations” shall mean all obligations, liabilities, Loans and Indebtedness of every kind, nature and description owing by Borrower to Lender pursuant to the Loan Documents, including, without limitation, principal, interest, repurchase obligations, charges, fees, costs and expenses, however evidenced, whether as principal, surety, endorser, guarantor or otherwise, whether now existing or hereafter arising, whether arising before, during or after the Term or after the commencement of any case with respect to Borrower under the United States Bankruptcy Code or any similar statute (including, without limitation, the payment of interest and other amounts which would accrue and become due but for the commencement of such case), whether direct or indirect, absolute or contingent, joint or several, due or not due, primary or secondary, liquidated or unliquidated, secured or unsecured.