SharpSpring, Inc. (Form: 8-K, Received: 11/22/2019 17:01:39)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): November 20, 2019

SharpSpring, Inc.

(Exact name of registrant as specified in its charter)

Delaware		001-36280		05-0502529
(State or other jurisdiction of Incorporation or Organization)		(Commission File Number)		(I.R.S. Employer Identification No.)

5001 Celebration Pointe Avenue, Gainesville, FL		32608
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code: 888-428-9605

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

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

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

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

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

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

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, par value $0.001 per share	SHSP	NASDAQ Stock Market

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

Emerging growth company [ ]

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

Item 1.01. Entry into a Material Definitive Agreement.

On November 21, 2019, SharpSpring, Inc., a Delaware corporation (the “Company”), entered into an Asset Purchase Agreement (the “Asset Purchase Agreement”) with Marin Software Incorporated, a Delaware corporation (“Seller”). Pursuant to the terms and conditions set forth in the Asset Purchase Agreement, the Company purchased the assets used in Seller’s business unit providing small-to-medium business-focused display retargeting software products and services under the “Perfect Audience” brand name (the “Perfect Audience Business”) for approximately $4.6 million in cash and the assumption of certain specified liabilities (the “Purchase Price”, and such transaction, the “Asset Purchase”).

The Asset Purchase was consummated contemporaneously with execution of the Asset Purchase Agreement on November 21, 2019 (the “Closing”). Upon the consummation of the Asset Purchase, the Company commenced operation of the Perfect Audience Business. Seller agreed to provide certain services for a period of time following the Closing to facilitate the smooth transition of the Perfect Audience Business, and the Company extended an offer of employment to one Perfect Audience Business employee. Seller also agreed to maintain the registration of the second-level domain for a certain Internet sub-domain for a period of five years following the Closing on such terms as are specified within the Asset Purchase Agreement.

The Asset Purchase Agreement contains customary covenants of the Company and of Seller. Among other things, Seller and its affiliates agreed, for a period of one year following the Closing, to refrain from (a) soliciting for employment or hiring any transferred employee of the Perfect Audience Business (subject to customary exceptions for general solicitations) and (b) soliciting or enticing any customer of the Perfect Audience Business as of immediately prior to the Closing to purchase products or services from Seller or such affiliate that are directly competitive with the Perfect Audience Business (subject to customary exceptions).

The Asset Purchase Agreement contains customary representations and warranties of each of the Company and Seller. Pursuant to the Asset Purchase Agreement, following the Closing, (i) Seller has agreed to indemnify the Company and its affiliates for any losses arising from a breach of or inaccuracy in certain specified representations and warranties of Seller contained in the Asset Purchase Agreement and any liabilities relating to Seller’s business or the Perfect Audience Business not specifically assumed by the Company in connection with the Asset Purchase and (ii) the Company has agreed to indemnify Seller and its affiliates for any losses arising from the specified liabilities assumed by the Company in connection with the Asset Purchase.

The foregoing summary of the Asset Purchase Agreement does not purport to be complete and is subject to, and qualified in its entirety by, the Asset Purchase Agreement, which is filed as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated herein by reference. The representations, warranties and covenants contained in the Asset Purchase Agreement are subject to qualifications and limitations agreed to by the respective parties, including information contained in confidential schedules exchanged between the parties, were made only for the purposes of such and as of specified dates and were solely for the benefit of the parties to the Asset Purchase Agreement. A number of the representations and warranties have been made for the purposes of allocating contractual risk between the parties to the Asset Purchase Agreement instead of establishing these matters as facts and may be subject to a contractual standard of materiality different from what might be viewed as material to investors. Investors are not third-party beneficiaries under the Asset Purchase Agreement. Moreover, information concerning the subject matter of the representations and warranties may change after the date of the Asset Purchase Agreement, which subsequent information may or may not be fully reflected in the Company’s public disclosures. Accordingly, investors should not rely on the representations and warranties as characterizations of the actual state of facts or condition of the transferred assets, the Perfect Audience Business, the Company or any of its subsidiaries or affiliates.

Item 2.01 Completion of Acquisition or Disposition of Assets.

Reference is made to the disclosure set forth above in Item 1.01 of this Current Report on Form 8-K.

Item 3.02. Unregistered Sales of Equity Securities.

On November 22, 2019, the Company issued and sold 555,556 shares (the “Shares”) of its common stock, par value $0.001 per share, to funds managed by Greenhaven Road Investment Management, L.P. and other institutional stockholders of the Company (collectively, the “Investors”) for an aggregate purchase price of $5.0 million, in accordance with the terms of a Purchase Agreement dated November 20, 2019 (the “Share Purchase Agreement”) by and among the Company and the Investors. The Company believes that the offering and sale of the Shares to the Investors was exempt from registration requirements under the Securities Act of 1933, as amended (the “Securities Act”) pursuant to Section 4(a)(2) of the Securities Act and Rule 506 of Regulation D promulgated thereunder. Each of the Investors represented its intention to acquire the Shares purchased by such Investor for such Investor’s own account, and not with a view to the resale or distribution of any part thereof in violation of the Securities Act.

In connection with the Share Purchase Agreement, the Company entered into a Registration Rights Agreement dated as of November 20, 2019 by and among the Company and the Investors (the “Registration Rights Agreement”). Under the Registration Rights Agreement and subject to the terms and conditions thereof, the Company is required, no later than 30 days after the closing date of the sale of the Shares to the Investors, to prepare and file with the Securities and Exchange Commission a registration statement (the “Registration Statement”) covering the resales of the Shares by the Investors. The Company is further required under the Registration Rights Agreement to use commercially reasonable efforts to have the Registration Statement declared effective as soon as practicable after the filing thereof, and to maintain the effectiveness of the Registration Statement in accordance with the terms of the Registration Rights Agreement.

Copies of the Share Purchase Agreement and the Registration Rights Agreement are filed as Exhibits 10.1 and 10.2, respectively, to this Current Report on Form 8-K, and are incorporated herein by reference.

Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

On November 21, 2019 the Company’s Board of Directors appointed Michael Power to serve as the Company’s Chief Financial Officer commencing on December 2, 2019 to hold office until the earlier election and qualification of his respective successor or until his earlier resignation or removal. As the Company’s Chief Financial Officer, Mr. Power will be responsible for overseeing the Company’s financial reporting and all other finance functions of the Company and all of the Company’s subsidiaries.

Bradley Stanczak, the Company’s current Chief Financial Officer, will step down from his role as Chief Financial Officer upon the commencement of Mr. Power’s appointment. Mr. Stanczak is expected to remain with the Company for a limited time in a non-executive role to assist Mr. Power with his transition into the Chief Financial Officer position.

There are no arrangements or understandings between Mr. Power and any other persons pursuant to which he was appointed the Company’s Chief Financial Officer. There is no family relationship between Mr. Power and any director, executive officer, or person nominated or chosen by the Company to become a director or executive officer of the Company. The Company has not entered into any transactions with Mr. Power that would require disclosure pursuant to Item 404(a) of Regulation S-K under the Securities Exchange Act of 1934.

Mr. Power, age 54, has over 30 years of finance and accounting experience. From June 2015 to March 2019, Mr. Power was Executive Vice President, Chief Financial Officer and Treasurer for ConnectWise, Inc., an IT management suite of SaaS software company. From 2005 to 2015, Mr. Power served as Vice President and Controller for CHUBB, formerly ACE Limited. Mr. Power holds an active CPA in the state of Pennsylvania, CGMA from the American Institute of CPAs and obtained a Bachelor of Science in Accountancy from Villanova University.

Mr. Power will enter into a written employee agreement with the Company whereby Mr. Power will receive as compensation, among other things, a base salary of $250,000 per year, along with an annual performance-based bonus compensation opportunity of $70,000. Additionally, Mr. Power will be granted Restricted Stock Units (“RSUs”) with a total quantity determined by the fair value of 100,000 options pursuant to the Company’s 2019 Equity Incentive Plan. The RSUs shall vest over a four year period, with 25% vesting after one year and monthly vesting thereafter. A copy of Mr. Power’s employee agreement is attached as Exhibit 10.3 to this Current Report Form 8-K and is incorporated herein by reference.

Item 8.01 Other Events

On November 21, 2019, the Company issued press releases relating to (1) the matters described under Item 5.02 and (2) the transactions described under Items 1.01, 2.01 and 3.02 of this Current Report on Form 8-K, respectively. Copies of the press releases are attached to this Current Report on Form 8-K as Exhibits 99.2 and 99.3, respectively, and are incorporated herein by reference.

Item 9.01 Financial Statements and Exhibits

Exhibit No.		Description
10.1		Share Purchase Agreement among SharpSpring, Inc., Special Situations Private Equity Fund, L.P., Special Situations Technology Fund, L.P., Special Situations Technology Fund II, L.P., Greenhaven Road Capital Fund 1, L.P., and Greenhaven Road Capital Fund 2, L.P.
10.2		Registration Rights Agreement among SharpSpring, Inc., Special Situations Private Equity Fund, L.P., Special Situations Technology Fund, L.P., Special Situations Technology Fund II, L.P., Greenhaven Road Capital Fund 1, L.P., and Greenhaven Road Capital Fund 2, L.P.
10.3		Employment Agreement between the Company and Michael Power
99.1		Asset Purchase Agreement dated November 21, 2019 by and between SharpSpring Inc., and Marin Software Inc.
99.2		Press Release dated November 21, 2019
99.3		Press Release dated November 21, 2019

SIGNATURES

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

	SHARPSPRING, INC.

Dated: November 22, 2019	By:	/s/ Bradley M. Stanczak
		Bradley M. Stanczak,
		Chief Financial Officer

Exhibit 10.1

PURCHASE AGREEMENT

THIS PURCHASE AGREEMENT (“Agreement”) is made as of the 20th day of November, 2019 by and among SharpSpring, Inc., a Delaware corporation (the “Company”), and the Investors set forth on the signature pages affixed hereto (each an “Investor” and collectively the “Investors”).

Recitals

A. The Company and the Investors are executing and delivering this Agreement in reliance upon the exemption from securities registration afforded by the provisions of Regulation D (“Regulation D”), as promulgated by the U.S. Securities and Exchange Commission (the “SEC”) under the Securities Act of 1933, as amended; and

B. The Investors wish to purchase, severally and not jointly, from the Company, and the Company wishes to sell and issue to the Investors, upon the terms and conditions stated in this Agreement, an aggregate of 555,556 shares (the “Shares”) of the Company’s Common Stock, par value $0.001 per share (together with any securities into which such shares may be reclassified, whether by merger, charter amendment or otherwise, the “Common Stock”), at purchase price of $9.00 per Share (the “Per Share Price”), for an aggregate purchase price of Five Million Four Dollars ($5,000,004) (the “Purchase Price”); and

C. Contemporaneously herewith, the parties hereto are executing and delivering a Registration Rights Agreement, in the form attached hereto as Exhibit A (the “Registration Rights Agreement”), pursuant to which the Company will agree to provide certain registration rights under the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder, and applicable state securities laws.

D. The Company has entered into an Asset Purchase Agreement in the form attached hereto as Exhibit B (the “Asset Purchase Agreement”), pursuant to which the Company will, on or prior to the Closing (as defined below), acquire (the “Acquisition”) from Marin Software Incorporated (“Seller”) substantially all of the assets and assume certain liabilities of the Seller’s Perfect Audience business (the “Target”) for aggregate consideration not to exceed Five Million Dollars ($5,000,000) (the “Acquisition Consideration”);

In consideration of the mutual promises made herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

1. Definitions. In addition to those terms defined above and elsewhere in this Agreement, for the purposes of this Agreement, the following terms shall have the meanings set forth below:

“Acquisition Documents” means the Asset Purchase Agreement, the Services Agreement in substantially the form attached as exhibits to the Asset Purchase Agreement, and any related ancillary documents entered into by the Company or any Subsidiary in connection with the Acquisition.

“Acquisition Transactions” means the Acquisition and the other transactions contemplated by the Asset Purchase Agreement and the other Acquisition Documents.

“Affiliate” means, with respect to any Person, any other Person which directly or indirectly through one or more intermediaries Controls, is controlled by, or is under common Control with, such Person.

“Business Day” means a day, other than a Saturday or Sunday, on which banks in New York City are open for the general transaction of business.

“Common Stock Equivalents” means any securities of the Company or the Subsidiaries which would entitle the holder thereof to acquire at any time Common Stock, including without limitation, any debt, preferred stock, rights, options, warrants or other instrument that is at any time convertible into, exercisable or exchangeable for, or otherwise entitles the holder thereof to receive, Common Stock.

“Company’s Knowledge” means the actual knowledge of the executive officers (as defined in Rule 405 under the 1933 Act) of the Company, after due inquiry.

“Confidential Information” means trade secrets, confidential information and know-how (including but not limited to ideas, formulae, compositions, processes, procedures and techniques, research and development information, computer program code, performance specifications, support documentation, drawings, specifications, designs, business and marketing plans, and customer and supplier lists and related information).

“Control” (including the terms “controlling”, “controlled by” or “under common control with”) means 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.

“Effective Date” means the date on which the Registration Statement is declared effective by the SEC.

“Effectiveness Deadline” means the date on which the Registration Statement is required to be declared effective by the SEC under the terms of the Registration Rights Agreement.

“Insider” means each director or executive officer of the Company, any other officer of the Company participating in the offering, any beneficial owner of 20% or more of the Company’s outstanding voting equity securities, calculated on the basis of voting power, and any promoter connected with the Company in any capacity on the date hereof.

“Intellectual Property” means all of the following: (i) patents, patent applications, patent disclosures and inventions (whether or not patentable and whether or not reduced to practice); (ii) trademarks, service marks, trade dress, trade names, corporate names, logos, slogans and Internet domain names, together with all goodwill associated with each of the foregoing; (iii) copyrights and copyrightable works; (iv) registrations, applications and renewals for any of the foregoing; and (v) proprietary computer software (including but not limited to data, data bases and documentation).

“Material Adverse Effect” means a material adverse effect on (i) the assets, liabilities, results of operations, condition (financial or otherwise), business, or prospects of the Company and its Subsidiaries taken as a whole, or (ii) the ability of the Company or any Subsidiary, as the case may be, to perform its obligations under the Acquisition Documents and the Transaction Documents.

“Material Contract” means the Acquisition Documents and any contract, instrument or other agreement to which the Company or any Subsidiary is a party or by which it is bound which is material to the business of the Company and its Subsidiaries, taken as a whole, including those that have been filed or were required to have been filed as an exhibit to the SEC Filings pursuant to Item 601(b)(4) or Item 601(b)(10) of Regulation S-K.

“Nasdaq” means The Nasdaq Global Market.

“Person” means an individual, corporation, partnership, limited liability company, trust, business trust, association, joint stock company, joint venture, sole proprietorship, unincorporated organization, governmental authority or any other form of entity not specifically listed herein.

“Registration Statement” has the meaning set forth in the Registration Rights Agreement.

“Required Investors” means (i) prior to Closing each of the Investors party hereto and (ii) from and after the Closing, (A) each Investor, who, together with its Affiliates, beneficially owns (calculated in accordance with Rule 13d-3 under the 1934 Act) at least 25% of the Shares and (B) the Investors who, together with their Affiliates, beneficially own (calculated in accordance with Rule 13d-3 under the 1934 Act) at least a majority of the Shares then owned by the Investors.

“SEC Filings” has the meaning set forth in Section 4.6.

“Subsidiary” of any Person means another Person, an amount of the voting securities, other voting ownership or voting partnership interests of which is sufficient to elect at least a majority of its Board of Directors or other governing body (or, if there are no such voting interests, 50% or more of the equity interests of which) is owned directly or indirectly by such first Person.

“Transaction Documents” means this Agreement and the Registration Rights Agreement.

“1933 Act” means the Securities Act of 1933, as amended, or any successor statute, and the rules and regulations promulgated thereunder.

“1934 Act” means the Securities Exchange Act of 1934, as amended, or any successor statute, and the rules and regulations promulgated thereunder.

2. Purchase and Sale of the Shares. Subject to the terms and conditions of this Agreement, on the Closing Date, each of the Investors shall severally, and not jointly, purchase, and the Company shall sell and issue to each Investor, the Shares in the amount set forth opposite such Investor’s name on the signature pages attached hereto in exchange for the portion of the Purchase Price equal to the Per Share Price multiplied by the number of Shares to be purchased by such Investor as specified in Section 3 below.

3. Closing. Unless other arrangements have been made with a particular Investor, upon confirmation that the other conditions to closing specified herein have been satisfied or duly waived by the Investors, the Company shall deliver to Lowenstein Sandler LLP, in trust, a certificate or certificates, registered in such name or names as the Investors may designate, representing the Shares, with instructions that such certificates are to be held for release to the Investors only upon payment in full of the Purchase Price to the Company by all the Investors. Unless other arrangements have been made with a particular Investor, upon such receipt by Lowenstein Sandler LLP of the certificates, each Investor shall promptly, but no more than one Business Day thereafter, cause a wire transfer in same day funds to be sent to the account of the Company as instructed in writing by the Company, in an amount representing such Investor’s pro rata portion of the Purchase Price as set forth on the signature pages to this Agreement. On the date (the “Closing Date”) the Company receives the Purchase Price, the certificates evidencing the Shares shall be released to the Investors (the “Closing”). The Closing of the purchase and sale of the Shares shall take place at the offices of Lowenstein Sandler LLP, 1251 Avenue of the Americas, 18th Floor, New York, New York 10020, or at such other location and on such other date as the Company and the Investors shall mutually agree.

4. Representations and Warranties of the Company. The Company hereby represents and warrants to the Investors that, except as set forth in the schedules delivered herewith (collectively, the “Disclosure Schedules”):

4. 1 Organization, Good Standing and Qualification. Each of the Company and its Subsidiaries is a corporation duly organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation and has all requisite corporate power and authority to carry on its business as now conducted and to own or lease its properties. Each of the Company and its Subsidiaries is duly qualified to do business as a foreign corporation and is in good standing in each jurisdiction in which the conduct of its business or its ownership or leasing of property makes such qualification or leasing necessary unless the failure to so qualify or to be in good standing has not had and could not reasonably be expected to have a Material Adverse Effect. The Company’s Subsidiaries are listed on Schedule 4.1 hereto.

4.2 Authorization. The Company has full power and authority and has taken, or caused one or more of its Subsidiaries to take, all requisite action on the part of the Company, such Subsidiaries, and their respective officers, directors and stockholders necessary for (i) the authorization, execution and delivery of the Acquisition Documents and the Transaction Documents, (ii) the authorization of the performance of all obligations of the Company and such Subsidiaries hereunder and thereunder, and (iii) the authorization, issuance and delivery of the Shares and the consummation of the Acquisition Transactions. The Acquisition Documents and the Transaction Documents constitute, or upon the execution and delivery thereof by the Company or the Subsidiary party thereto will constitute, the legal, valid and binding obligations of the Company or such Subsidiary, enforceable against the Company or the Subsidiary party thereto, as the case may be, in accordance with their terms, subject to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and similar laws of general applicability, relating to or affecting creditors’ rights generally and to general equitable principles.

4.3 Capitalization. The SEC Filings set forth, as of their respective dates (to the extent applicable) (a) the authorized capital stock of the Company; (b) the number of shares of capital stock issued and outstanding; (c) the number of shares of capital stock issuable pursuant to the Company’s stock plans; and (d) the number of shares of capital stock issuable and reserved for issuance pursuant to securities (other than the Shares) exercisable for, or convertible into or exchangeable for any shares of capital stock of the Company. All of the issued and outstanding shares of the Company’s capital stock have been duly authorized and validly issued and are fully paid, nonassessable and free of pre-emptive rights and were issued in compliance in all material respects with applicable state and federal securities law and any rights of third parties. All of the issued and outstanding shares of capital stock of each Subsidiary have been duly authorized and validly issued and are fully paid, nonassessable and free of pre-emptive rights, were issued in full compliance with applicable state and federal securities law and any rights of third parties and are owned by the Company, beneficially and of record, subject to no lien, encumbrance or other adverse claim, except as described in the SEC Filings. No Person is entitled to pre-emptive or similar statutory or contractual rights with respect to any securities of the Company. Except as described in the SEC Filings, there are no outstanding warrants, options, convertible securities or other rights, agreements or arrangements of any character under which the Company or any of its Subsidiaries is or may be obligated to issue any equity securities of any kind and except as contemplated by this Agreement, neither the Company nor any of its Subsidiaries is currently in negotiations for the issuance of any equity securities of any kind. Except for the Registration Rights Agreement, there are no voting agreements, buy-sell agreements, option or right of first purchase agreements or other agreements of any kind among the Company and any of the securityholders of the Company relating to the securities of the Company held by them. Except as provided in the Registration Rights Agreement, no Person has the right to require the Company to register any securities of the Company under the 1933 Act, whether on a demand basis or in connection with the registration of securities of the Company for its own account or for the account of any other Person.

The issuance and sale of the Shares hereunder will not obligate the Company to issue shares of Common Stock or other securities to any other Person (other than the Investors) and will not result in the adjustment of the exercise, conversion, exchange or reset price of any outstanding security.

The Company does not have outstanding stockholder purchase rights or “poison pill” or any similar arrangement in effect giving any Person the right to purchase any equity interest in the Company upon the occurrence of certain events.

4.4 Valid Issuance. The Shares have been duly and validly authorized and, when issued and paid for pursuant to this Agreement, will be validly issued, fully paid and nonassessable, and shall be free and clear of all encumbrances and restrictions (other than those created by the Investors), except for restrictions on transfer set forth in the Transaction Documents or imposed by applicable securities laws.

4.5 Consents. The execution, delivery and performance by the Company or its Subsidiaries, as the case may be, of the Acquisition Documents and the Transaction Documents, the consummation of the Acquisition Transactions, and the offer, issuance and sale of the Shares require no consent of, action by or in respect of, or filing with, any Person, governmental body, agency, or official other than filings that have been made pursuant to applicable state securities laws and post-sale filings pursuant to applicable state and federal securities laws which the Company undertakes to file within the applicable time periods. Subject to the accuracy of the representations and warranties of each Investor set forth in Section 5 hereof, the Company has taken all action necessary to exempt (i) the issuance and sale of the Shares, and (ii) the other transactions contemplated by the Transaction Documents from the provisions of any applicable stockholder rights plan or other “poison pill” arrangement, any anti-takeover, business combination or control share law or statute binding on the Company or to which the Company or any of its assets and properties may be subject and any provision of the Company’s Certificate of Incorporation or Bylaws that is or could reasonably be expected to become applicable to the Investors as a result of the transactions contemplated hereby, including without limitation, the issuance of the Shares and the ownership, disposition or voting of the Shares by the Investors or the exercise of any right granted to the Investors pursuant to this Agreement or the other Transaction Documents.

4.6 Delivery of SEC Filings; Business. The Company has made available to the Investors through the EDGAR system, true and complete copies of the Company’s most recent Annual Report on Form 10-K for the fiscal year ended December 31, 2018 (the “10-K”), and all other reports filed by the Company pursuant to the 1934 Act since December 31, 2018 and prior to the date hereof (collectively, the “SEC Filings”). The SEC Filings are the only filings required of the Company pursuant to the 1934 Act for such period. The Company and its Subsidiaries are engaged in all material respects only in the business described in the SEC Filings and the SEC Filings contain a complete and accurate description in all material respects of the business of the Company and its Subsidiaries, taken as a whole. Since the filing of each of the SEC Filings, no event has occurred that would require an amendment or supplement to any such SEC Filing and as to which such an amendment or supplement has not been filed prior to the date hereof.

4.7 Use of Proceeds. The net proceeds of the sale of the Shares hereunder shall be used by the Company to pay the Acquisition Consideration and, to the extent of any excess, for general corporate purposes.

4.8 No Material Adverse Change. Since December 31, 2018, except as identified and described in the SEC Filings or as previously disclosed to the Investors and to be publicly disclosed prior to or in the Press Release (as defined in Section 9.7), there has not been:

(i) any change in the consolidated assets, liabilities, financial condition or operating results of the Company from that reflected in the financial statements included in the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2019, except as contemplated by the Acquisition Transactions and except for changes in the ordinary course of business which have not had and could not reasonably be expected to have a Material Adverse Effect, individually or in the aggregate;

(ii) any declaration or payment of any dividend, or any authorization or payment of any distribution, on any of the capital stock of the Company, or any redemption or repurchase of any securities of the Company;

(iii) any material damage, destruction or loss, whether or not covered by insurance to any assets or properties of the Company or its Subsidiaries;

(iv) any waiver, not in the ordinary course of business, by the Company or any Subsidiary of a material right or of a material debt owed to it;

(v) any satisfaction or discharge of any lien, claim or encumbrance or payment of any obligation by the Company or a Subsidiary, except in the ordinary course of business and which is not material to the assets, properties, financial condition, operating results or business of the Company and its Subsidiaries taken as a whole (as such business is presently conducted and as it is proposed to be conducted);

(vi) any change or amendment to the Company’s Certificate of Incorporation or Bylaws, or material change to any material contract or arrangement by which the Company or any Subsidiary is bound or to which any of their respective assets or properties is subject;

(vii) any material labor difficulties or labor union organizing activities with respect to employees of the Company or any Subsidiary;

(viii) Except as contemplated by the Acquisition Documents and the Transaction Documents, any material transaction entered into by the Company or a Subsidiary other than in the ordinary course of business;

(ix) the loss of the services of any executive officer, other key employee, or material change in the composition or duties of the senior management of the Company or any Subsidiary;

(x) the loss or threatened loss of any customer which has had or could reasonably be expected to have a Material Adverse Effect; or

(xi) any other event or condition of any character that has had or could reasonably be expected to have a Material Adverse Effect.

4.9 SEC Filings; S-3 Eligibility.

(a) At the time of filing thereof, the SEC Filings complied as to form in all material respects with the requirements of the 1934 Act and did not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements made therein, in the light of the circumstances under which they were made, not misleading.

(b) Each registration statement and any amendment thereto filed by the Company since January 1, 2016 pursuant to the 1933 Act and the rules and regulations thereunder, as of the date such statement or amendment became effective, complied as to form in all material respects with the 1933 Act and did not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements made therein not misleading; and each prospectus filed pursuant to Rule 424(b) under the 1933 Act, as of its issue date and as of the closing of any sale of securities pursuant thereto did not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements made therein, in the light of the circumstances under which they were made, not misleading.

(c) The Company is eligible to use Form S-3 to register the Registrable Securities (as such term is defined in the Registration Rights Agreement) for sale or other disposition by the Investors as contemplated by the Registration Rights Agreement.

4.10 No Conflict, Breach, Violation or Default. The execution, delivery and performance of the Acquisition Documents and the Transaction Documents by the Company or the Subsidiaries party thereto, as the case may be, the consummation of the Acquisition Transactions and the issuance and sale of the Shares will not (i) conflict with or result in a breach or violation of (a) any of the terms and provisions of, or constitute a default under the Company’s Certificate of Incorporation or the Company’s Bylaws, both as in effect on the date hereof (true and complete copies of which have been made available to the Investors through the EDGAR system), or (b) any statute, rule, regulation or order of any governmental agency or body or any court, domestic or foreign, having jurisdiction over the Company, any Subsidiary or any of their respective assets or properties, except for such conflicts, breaches or violations as have not had and could not reasonably be expected to have a Material Adverse Effect, individually or in the aggregate, or (ii) conflict with, or constitute a default (or an event that with notice or lapse of time or both would become a default) under, result in the creation of any lien, encumbrance or other adverse claim upon any of the properties or assets of the Company or any Subsidiary or give to others any rights of termination, amendment, acceleration or cancellation (with or without notice, lapse of time or both) of, any Material Contract, except for such as have not had and could not reasonably be expected to have a Material Adverse Effect, individually or in the aggregate.

4.11 Tax Matters. The Company and each Subsidiary has timely prepared and filed all tax returns required to have been filed by the Company or such Subsidiary with all appropriate governmental agencies and timely paid all taxes shown thereon or otherwise owed by it, other than taxes being contested in good faith and for which adequate reserves have been made on the Company’s financial statements included in the SEC Filings. The charges, accruals and reserves on the books of the Company in respect of taxes for all fiscal periods are adequate in all material respects, and there are no material unpaid assessments against the Company or any Subsidiary nor, to the Company’s Knowledge, any basis for the assessment of any additional taxes, penalties or interest for any fiscal period or audits by any federal, state or local taxing authority except for any assessment which is not material to the Company and its Subsidiaries, taken as a whole. All taxes and other assessments and levies that the Company or any Subsidiary is required to withhold or to collect for payment have been duly withheld and collected and paid to the proper governmental entity or third party when due, other than taxes being contested in good faith and for which adequate reserves have been made on the Company’s financial statements included in the SEC Filings. There are no tax liens or claims pending or, to the Company’s Knowledge, threatened against the Company or any Subsidiary or any of their respective assets or property. There are no outstanding tax sharing agreements or other such arrangements between the Company and any Subsidiary or other corporation or entity.

4.12 Title to Properties. Except as disclosed in the SEC Filings, the Company and each Subsidiary has good and marketable title to all real properties and all other properties and assets owned by it, in each case free from liens, encumbrances and defects that would materially affect the value thereof or materially interfere with the use made or currently planned to be made thereof by them; and except as disclosed in the SEC Filings, the Company and each Subsidiary holds any leased real or personal property under valid and enforceable leases with no exceptions that would materially interfere with the use made or currently planned to be made thereof by them.

4.13 Certificates, Authorities and Permits. The Company and each Subsidiary possess adequate certificates, authorities or permits issued by appropriate governmental agencies or bodies necessary to conduct the business now operated by it, except where the failure to so possess has not had and could not reasonably be expected to have a Material Adverse Effect, individually or in the aggregate, and neither the Company nor any Subsidiary has received any notice of proceedings relating to the revocation or modification of any such certificate, authority or permit that, if determined adversely to the Company or such Subsidiary, could reasonably be expected to have a Material Adverse Effect, individually or in the aggregate.

4.14 Labor Matters.

(a) The Company is not a party to or bound by any collective bargaining agreements or other agreements with labor organizations. The Company has not violated in any material respect any laws, regulations, orders or contract terms, affecting the collective bargaining rights of employees, labor organizations or any laws, regulations or orders affecting employment discrimination, equal opportunity employment, or employees’ health, safety, welfare, wages and hours.

(b) (i) There are no labor disputes existing, or to the Company’s Knowledge, threatened, involving strikes, slow-downs, work stoppages, job actions, disputes, lockouts or any other disruptions of or by the Company’s employees, (ii) there are no unfair labor practices or petitions for election pending or, to the Company’s Knowledge, threatened before the National Labor Relations Board or any other federal, state or local labor commission relating to the Company’s employees, (iii) no demand for recognition or certification heretofore made by any labor organization or group of employees is pending with respect to the Company and (iv) to the Company’s Knowledge, the Company enjoys good labor and employee relations with its employees and labor organizations.

(c) The Company is, and at all times has been, in compliance with all applicable laws respecting employment (including laws relating to classification of employees and independent contractors) and employment practices, terms and conditions of employment, wages and hours, and immigration and naturalization, except for such instances of non-compliance as have not had and could not reasonably be expected to have a Material Adverse Effect, individually or in the aggregate. There are no claims pending against the Company before the Equal Employment Opportunity Commission or any other administrative body or in any court asserting any violation of Title VII of the Civil Rights Act of 1964, the Age Discrimination Act of 1967, 42 U.S.C. §§ 1981 or 1983 or any other federal, state or local Law, statute or ordinance barring discrimination in employment.

(d) Except as disclosed in the SEC Filings, the Company is not a party to, or bound by, any employment or other contract or agreement that contains any severance, termination pay or change of control liability or obligation, including, without limitation, any “excess parachute payment,” as defined in Section 280G(b) of the Internal Revenue Code.

(e) To the Company’s Knowledge, each employee of the Company and its Subsidiaries located in the United States is a Person who is either a United States citizen or a permanent resident entitled to work in the United States. To the Company’s Knowledge, neither the Company nor any Subsidiary has any liability for the improper classification of any such employee as an independent contractor or leased employee.

4.15 Intellectual Property.

(a) All Intellectual Property of the Company and its Subsidiaries is currently in compliance in all material respects with all legal requirements (including timely filings, proofs and payments of fees) and is valid and enforceable. No Intellectual Property of the Company or its Subsidiaries which is necessary for the conduct of Company’s and each of its Subsidiaries’ respective businesses as currently conducted or as currently proposed to be conducted has been or is now involved in any cancellation, dispute or litigation, and, to the Company’s Knowledge, no such action is threatened. No patent of the Company or its Subsidiaries has been or is now involved in any interference, reissue, re-examination or opposition proceeding.

(b) All of the licenses and sublicenses and consent, royalty or other agreements concerning Intellectual Property which are necessary for the conduct of the Company’s and each of its Subsidiaries’ respective businesses as currently conducted or as currently proposed to be conducted to which the Company or any Subsidiary is a party or by which any of their assets are bound (other than generally commercially available, non-custom, off-the-shelf software application programs having a retail acquisition price of less than $10,000 per license) (collectively, “License Agreements”) are valid and binding obligations of the Company or its Subsidiaries that are parties thereto and, to the Company’s Knowledge, the other parties thereto, enforceable in accordance with their terms, except to the extent that enforcement thereof may be limited by bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance or other similar laws affecting the enforcement of creditors’ rights generally, and there exists no event or condition which will result in a violation or breach of or constitute (with or without due notice or lapse of time or both) a default by the Company or any of its Subsidiaries under any such License Agreement, except for such violations, breaches and defaults as have not had and could not reasonably be expected to have a Material Adverse Effect, individually or in the aggregate.

(c) The Company and its Subsidiaries own or have the valid right to use all of the Intellectual Property that is necessary for the conduct of the Company’s and each of its Subsidiaries’ respective businesses as currently conducted or as currently proposed to be conducted and for the ownership, maintenance and operation of the Company’s and its Subsidiaries’ properties and assets, free and clear of all liens, encumbrances, adverse claims or obligations to license all such owned Intellectual Property and Confidential Information, other than licenses entered into in the ordinary course of the Company’s and its Subsidiaries’ businesses. The Company and its Subsidiaries have a valid and enforceable right to use all third party Intellectual Property and Confidential Information used or held for use in the respective businesses of the Company and its Subsidiaries.

(d) The conduct of the Company’s and its Subsidiaries’ businesses as currently conducted does not infringe or otherwise impair or conflict with (collectively, “Infringe”) any Intellectual Property rights of any third party or any confidentiality obligation owed to a third party, and, to the Company’s Knowledge, the Intellectual Property and Confidential Information of the Company and its Subsidiaries which are necessary for the conduct of Company’s and each of its Subsidiaries’ respective businesses as currently conducted or as currently proposed to be conducted are not being Infringed by any third party. There is no litigation or order pending or outstanding or, to the Company’s Knowledge, threatened or imminent, that seeks to limit or challenge or that concerns the ownership, use, validity or enforceability of any Intellectual Property or Confidential Information of the Company and its Subsidiaries and the Company’s and its Subsidiaries’ use of any Intellectual Property or Confidential Information owned by a third party, and, to the Company’s Knowledge, there is no valid basis for the same.

(e) The consummation of the Acquisition Transactions and the transactions contemplated hereby and by the other Transaction Documents will not result in the alteration, loss, impairment of or restriction on the Company’s or any of its Subsidiaries’ ownership or right to use any of the Intellectual Property or Confidential Information which is necessary for the conduct of Company’s and each of its Subsidiaries’ respective businesses as currently conducted or as currently proposed to be conducted.

(f) The Company and its Subsidiaries have taken reasonable steps to protect the Company’s and its Subsidiaries’ rights in their Intellectual Property and Confidential Information. Each employee, consultant and contractor who has had access to Confidential Information which is necessary for the conduct of Company’s and each of its Subsidiaries’ respective businesses as currently conducted or as currently proposed to be conducted has executed an agreement to maintain the confidentiality of such Confidential Information and has executed appropriate agreements that are substantially consistent with the Company’s standard forms thereof. Except under confidentiality obligations, there has been no material disclosure of any of the Company’s or its Subsidiaries’ Confidential Information to any third party.

4.16 Environmental Matters. Neither the Company nor any Subsidiary is in violation of any statute, rule, regulation, decision or order of any governmental agency or body or any court, domestic or foreign, relating to the use, disposal or release of hazardous or toxic substances or relating to the protection or restoration of the environment or human exposure to hazardous or toxic substances (collectively, “Environmental Laws”), owns or operates any real property contaminated with any substance that is subject to any Environmental Laws, is liable for any off-site disposal or contamination pursuant to any Environmental Laws, or is subject to any claim relating to any Environmental Laws, which violation, contamination, liability or claim has had or could reasonably be expected to have a Material Adverse Effect, individually or in the aggregate; and there is no pending or, to the Company’s Knowledge, threatened investigation that might lead to such a claim.

4.17 Litigation. Except as disclosed in the SEC Filings, there are no pending actions, suits or proceedings against or affecting the Company, its Subsidiaries or any of its or their properties which are required to be disclosed in an SEC Filing; and to the Company’s Knowledge, no such actions, suits or proceedings are threatened or contemplated. Neither the Company nor any Subsidiary, nor any director or officer thereof, is or since January 1, 2014 has been the subject of any action involving a claim of violation of or liability under federal or state securities laws or a claim of breach of fiduciary duty. To the Company’s Knowledge, there is not pending or contemplated any investigation by the SEC involving the Company or any current or former director or officer of the Company. The SEC has not issued any stop order or other order suspending the effectiveness of any registration statement filed by the Company or any Subsidiary under the 1933 Act or the 1934 Act.

4.18 Financial Statements. The financial statements included in each SEC Filing comply in all material respects with applicable accounting requirements and the rules and regulations of the SEC with respect thereto as in effect at the time of filing (or to the extent corrected by a subsequent restatement) and present fairly, in all material respects, the consolidated financial position of the Company and its Subsidiaries as of the dates shown and their consolidated results of operations and cash flows for the periods shown, and such financial statements have been prepared in conformity with United States generally accepted accounting principles applied on a consistent basis (“GAAP”) (except as may be disclosed therein or in the notes thereto, and, in the case of quarterly financial statements, as permitted by Form 10-Q under the 1934 Act). Except as (i) set forth in the financial statements of the Company included in the SEC Filings filed prior to the date hereof or (ii) expressly contemplated by the Acquisition Transactions, neither the Company nor any of its Subsidiaries has incurred any liabilities, contingent or otherwise, except those incurred in the ordinary course of business, consistent (as to amount and nature) with past practices since the date of such financial statements, none of which, individually or in the aggregate, have had or could reasonably be expected to have a Material Adverse Effect.

4.19 Insurance Coverage. The Company and each Subsidiary maintains in full force and effect insurance coverage that is customary for comparably situated companies for the business being conducted and properties owned or leased by the Company and each Subsidiary, and the Company reasonably believes such insurance coverage to be adequate against all liabilities, claims and risks against which it is customary for comparably situated companies to insure.

4.20 Compliance with Nasdaq Continued Listing Requirements. The Company is in compliance with applicable Nasdaq continued listing requirements. There are no proceedings pending or, to the Company’s Knowledge, threatened against the Company relating to the continued listing of the Common Stock on Nasdaq and the Company has not received any notice of, nor to the Company’s Knowledge is there any basis for, the delisting of the Common Stock from Nasdaq.

4.21 Brokers and Finders. No Person will have, as a result of the transactions contemplated by the Transaction Documents, any valid right, interest or claim against or upon the Company, any Subsidiary or an Investor for any commission, fee or other compensation pursuant to any agreement, arrangement or understanding entered into by or on behalf of the Company, other than as disclosed to the Investors in writing on or prior to the date hereof.

4.22 No General Solicitation. Neither the Company nor any Person acting on its behalf has conducted any general solicitation or general advertising (as those terms are used in Regulation D) in connection with the offer or sale of any of the Shares.

4.23 No Integrated Offering. Neither the Company nor any of its Affiliates, nor any Person acting on its or their behalf has, directly or indirectly, made any offers or sales of any Company security or solicited any offers to buy any security, under circumstances that would adversely affect reliance by the Company on Section 4(a)(2) for the exemption from registration for the transactions contemplated hereby or would require registration of the Securities under the 1933 Act.

4.24 Rule 506 Compliance. To the Company’s knowledge, neither the Company nor any Insider is subject to any of the “Bad Actor” disqualifications described in Rule 506(d)(1)(i) to (viii) under the 1933 Act (a “Disqualification Event”), except for a Disqualification Event covered by Rule 506(d)(2)(i) or (d)(3) of the 1933 Act. The Company is not disqualified from relying on Rule 506 of Regulation D under the 1933 Act (“Rule 506”) for any of the reasons stated in Rule 506(d) in connection with the issuance and sale of the Securities to the Investors pursuant to this Agreement. The Company has exercised reasonable care, including without limitation, conducting a factual inquiry that is appropriate in light of the circumstances, into whether any such disqualification under Rule 506(d) exists. The Company has furnished to each Investor, a reasonable time prior to the date hereof, a description in writing of any matters relating to the Company and the Insiders that would have triggered disqualification under Rule 506(d) but which occurred before September 23, 2013, in each case, in compliance with the disclosure requirements of Rule 506(e). The Company has exercised reasonable care, including without limitation, conducting a factual inquiry that is appropriate in light of the circumstances, into whether any such disqualification under Rule 506(d) would have existed and whether any disclosure is required to be made to Investor under Rule 506(e). Any outstanding securities of the Company (of any kind or nature) that were issued in reliance on Rule 506 at any time on or after September 23, 2013 have been issued in compliance with Rule 506(d) and (e).

4.25 Private Placement. The offer and sale of the Shares to the Investors as contemplated hereby is exempt from the registration requirements of the 1933 Act.

4.26 Shell Company Status. The Company is not, and has never been, an issuer identified in Rule 144(i)(1).

4.27 Questionable Payments. Neither the Company nor any of its Subsidiaries nor, to the Company’s Knowledge, any of their respective current or former stockholders, directors, officers, employees, agents or other Persons acting on behalf of the Company or any Subsidiary, has on behalf of the Company or any Subsidiary or in connection with their respective businesses: (a) used any corporate funds for unlawful contributions, gifts, entertainment or other unlawful expenses relating to political activity; (b) made any direct or indirect unlawful payments to any governmental officials or employees from corporate funds; (c) established or maintained any unlawful or unrecorded fund of corporate monies or other assets; (d) made any false or fictitious entries on the books and records of the Company or any Subsidiary; or (e) made any unlawful bribe, rebate, payoff, influence payment, kickback or other unlawful payment of any nature.

4.28 Transactions with Affiliates. Except as disclosed in the SEC Filings and except for the participation in this offering of certain Investors that are Affiliates of a director of the Company, none of the officers or directors of the Company and, to the Company’s Knowledge, none of the employees of the Company is presently a party to any transaction with the Company or any Subsidiary (other than as holders of stock options and/or warrants, and for services as employees, officers and directors), including any contract, agreement or other arrangement providing for the furnishing of services to or by, providing for rental of real or personal property to or from, or otherwise requiring payments to or from any officer, director or such employee or, to the Company’s Knowledge, any entity in which any officer, director, or any such employee has a substantial interest or is an officer, director, trustee or partner.

4.29 Internal Controls. The Company is in material compliance with the provisions of the Sarbanes-Oxley Act of 2002 currently applicable to the Company. The Company and the Subsidiaries maintain a system of internal accounting controls sufficient to provide reasonable assurance that (i) transactions are executed in accordance with management’s general or specific authorizations, (ii) transactions are recorded as necessary to permit preparation of financial statements in conformity with GAAP and to maintain asset accountability, (iii) access to assets is permitted only in accordance with management’s general or specific authorization, and (iv) the recorded accountability for assets and liabilities is compared with the existing assets and liabilities at reasonable intervals and appropriate action is taken with respect to any differences. The Company has established disclosure controls and procedures (as defined in 1934 Act Rules 13a-15(e) and 15d-15(e)) for the Company and designed such disclosure controls and procedures to ensure that material information relating to the Company, including the Subsidiaries, is made known to the certifying officers by others within those entities, particularly during the period in which the Company’s most recently filed periodic report under the 1934 Act, as the case may be, is being prepared. The Company has established internal control over financial reporting (as defined in 1934 Act Rules 13a-15(f) and 15d-15(f)) to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with GAAP. The Company’s certifying officers have evaluated the effectiveness of the Company’s disclosure controls and procedures and the Company’s internal control over financial reporting (collectively, “internal controls”) as of the end of the period covered by the most recently filed periodic report under the 1934 Act (such date, the “Evaluation Date”). The Company presented in its most recently filed periodic report under the 1934 Act the conclusions of the certifying officers about the effectiveness of such internal controls based on their evaluations as of the Evaluation Date. Since the Evaluation Date, there have been no significant changes in the Company’s internal controls or, to the Company’s Knowledge, in other factors that could significantly affect the Company’s internal controls. The Company maintains and will continue to maintain a standard system of accounting established and administered in accordance with GAAP and the applicable requirements of the 1934 Act.

4.30 Disclosures. Neither the Company nor any Person acting on its behalf has provided the Investors or their agents or counsel with any information that constitutes or might constitute material, non-public information, other than the terms of the transactions contemplated hereby and the terms of the Acquisition. The written materials delivered to the Investors in connection with the transactions contemplated by the Acquisition Documents and the Transaction Documents do not contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements contained therein, in light of the circumstances under which they were made, not misleading.

4.31 Investment Company. The Company is not required to be registered as, and is not an Affiliate of, and immediately following the Closing will not be required to register as, an “investment company” within the meaning of the Investment Company Act of 1940, as amended.

4.32 Acquisition Transactions. The Company has provided the Investors and their counsel with true and complete copies of the Acquisition Documents. The representations and warranties of the Company and, to the Company’s Knowledge, the other parties to the Asset Purchase Agreement and the other Acquisition Documents are true and correct in all material respects. To the Company’s Knowledge, there is no reason that the Company or the other parties to the Asset Purchase Agreement or any other Acquisition Document, will not be able to perform in all material respects the covenants and obligations of the Company or such other parties set forth therein on a timely basis when due. Other than the Acquisition Documents, there are no other agreements, arrangements or understandings relating to the Acquisition or the other Acquisition Transactions that create substantive obligations on the Company or any Subsidiary. The Target does not constitute and, after giving effect to the Acquisition Transactions, will not constitute, a “significant subsidiary” of the Company as defined in Rule 1-02(w) of Regulation S-X under the 1933 Act. No financial statements of the Seller, the Target or any other entity other than the Company or pro forma financial information relating to the Acquisition will be required to be included in or incorporated by reference into the Registration Statement pursuant to the requirements of such Regulation S-X.

4.33. No Fiduciary. The Company acknowledges that none of the Investors is acting as a financial advisor or fiduciary of the Company (or in any similar capacity) with respect to this Agreement, the other Transaction Documents and the transactions contemplated hereby and thereby, and any advice or other guidance provided by any Investor or any of its representatives and agents with respect to this Agreement, the other Transaction Documents and the transactions contemplated hereby and thereby is merely incidental to such Investor’s entry into such transactions. The Company’s decision to enter into this Agreement and the other Transaction Documents has been based solely on the independent evaluation by the Company and its representatives and agents.

5. Representations and Warranties of the Investors. Each of the Investors hereby severally, and not jointly, represents and warrants to the Company that:

5.1 Organization and Existence. Such Investor is a validly existing corporation, limited partnership or limited liability company and has all requisite corporate, partnership or limited liability company power and authority to invest in the Shares pursuant to this Agreement.

5.2 Authorization. The execution, delivery and performance by such Investor of the Transaction Documents to which such Investor is a party have been duly authorized and each will constitute the valid and legally binding obligation of such Investor, enforceable against such Investor in accordance with their respective terms, subject to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and similar laws of general applicability, relating to or affecting creditors’ rights generally and to general equity principles.

5.3 Purchase Entirely for Own Account. The Shares to be received by such Investor hereunder will be acquired for such Investor’s own account, not as nominee or agent, and not with a view to the resale or distribution of any part thereof in violation of the 1933 Act, and such Investor has no present intention of selling, granting any participation in, or otherwise distributing the same in violation of the 1933 Act without prejudice, however, to such Investor’s right at all times to sell or otherwise dispose of all or any part of such Shares in compliance with applicable federal and state securities laws. Nothing contained herein shall be deemed a representation or warranty by such Investor to hold the Shares for any period of time. Such Investor is not a broker-dealer registered with the SEC under the 1934 Act or an entity engaged in a business that would require it to be so registered.

5.4 Investment Experience. Such Investor acknowledges that it can bear the economic risk and complete loss of its investment in the Shares and has such knowledge and experience in financial or business matters that it is capable of evaluating the merits and risks of the investment contemplated hereby.

5.5 Disclosure of Information. Such Investor has had an opportunity to receive all information related to the Company requested by it and to ask questions of and receive answers from the Company regarding the Company, its business and the terms and conditions of the offering of the Shares. Such Investor acknowledges receipt of copies of the SEC Filings. Neither such inquiries nor any other due diligence investigation conducted by such Investor shall modify, limit or otherwise affect such Investor’s right to rely on the Company’s representations and warranties contained in this Agreement.

5.6 Restricted Securities. Such Investor understands that the Shares are characterized as “restricted securities” under the U.S. federal securities laws inasmuch as they are being acquired from the Company in a transaction not involving a public offering and that under such laws and applicable regulations such securities may be resold without registration under the 1933 Act only in certain limited circumstances.

5.7 Legends. It is understood that, except as provided below, certificates evidencing the Shares may bear the following or any similar legend:

(a) “The securities represented hereby have not been registered with the Securities and Exchange Commission or the securities commission of any state in reliance upon an exemption from registration under the Securities Act of 1933, as amended, and, accordingly, may not be transferred unless (i) such securities have been registered for sale pursuant to the Securities Act of 1933, as amended, (ii) such securities are sold pursuant to Rule 144, or (iii) the Company has received an opinion of counsel reasonably satisfactory to it that such transfer may lawfully be made without registration under the Securities Act of 1933, as amended.”

(b) If required by the authorities of any state in connection with the issuance of sale of the Shares, the legend required by such state authority.

5.8 Investor Status. At the time such Investor was offered the Securities, it was, and at the date hereof it is, (i) an “accredited investor” as defined in Rule 501(a) under the 1933 Act and (ii) an “institutional investor” as defined in Financial Industry Regulatory Authority Rule 5110(d)(4)(B). Such Investor is not a registered broker dealer registered under Section 15(a) of the Exchange Act, or a member of the Financial Industry Regulatory Authority, Inc. (“FINRA”) or an entity engaged in the business of being a broker dealer. Except as otherwise disclosed in writing to the Company on or prior to the date of this Agreement, such Investor is not affiliated with any broker dealer registered under Section 15(a) of the 1934 Act, or a member of FINRA or an entity engaged in the business of being a broker dealer. Such Investor maintains his or her principal residence (in the case of an individual) or its principal executive office (in the case of an entity) at the location specified on its signature page hereto.

5.9 No General Solicitation. Such Investor did not learn of the investment in the Shares as a result of any general solicitation or general advertising.

5.10 Brokers and Finders. No Person will have, as a result of the transactions contemplated by the Transaction Documents, any valid right, interest or claim against or upon the Company, any Subsidiary or an Investor for any commission, fee or other compensation pursuant to any agreement, arrangement or understanding entered into by or on behalf of such Investor.

5.11 Prohibited Transactions. Since the earlier of (a) such time as such Investor was first contacted by the Company or any other Person acting on behalf of the Company regarding the transactions contemplated hereby or (b) thirty (30) days prior to the date hereof, neither such Investor nor any Affiliate of such Investor which (x) had knowledge of the Acquisition Transactions or the transactions contemplated hereby, (y) has or shares discretion relating to such Investor’s investments or trading or information concerning such Investor’s investments, including in respect of the Shares, or (z) is subject to such Investor’s review or input concerning such Affiliate’s investments or trading (collectively, “Trading Affiliates”) has, directly or indirectly, effected or agreed to effect any short sale, whether or not against the box, established any “put equivalent position” (as defined in Rule 16a-1(h) under the 1934 Act) with respect to the Common Stock, granted any other right (including, without limitation, any put or call option) with respect to the Common Stock or with respect to any security that includes, relates to or derived any significant part of its value from the Common Stock or otherwise sought to hedge its position in the Shares (each, a “Prohibited Transaction”). Prior to the earliest to occur of (i) the termination of this Agreement, (ii) the Effective Date or (iii) the Effectiveness Deadline, such Investor shall not, and shall cause its Trading Affiliates not to, engage, directly or indirectly, in a Prohibited Transaction. Such Investor acknowledges that the representations, warranties and covenants contained in this Section 5.11 are being made for the benefit of the Investors as well as the Company and that each of the other Investors shall have an independent right to assert any claims against such Investor arising out of any breach or violation of the provisions of this Section 5.11.

6. Conditions to Closing.

6.1 Conditions to the Investors’ Obligations. The obligation of each Investor to purchase its Shares at the Closing is subject to the satisfaction, on or prior to the Closing Date, of the following conditions, any of which may be waived by such Investor (as to itself only):

(a) The representations and warranties made by the Company in Section 4 hereof qualified as to materiality shall be true and correct at all times prior to and on the Closing Date, except to the extent any such representation or warranty expressly speaks as of an earlier date, in which case such representation or warranty shall be true and correct as of such earlier date, and, the representations and warranties made by the Company in Section 4 hereof not qualified as to materiality shall be true and correct in all material respects at all times prior to and on the Closing Date, except to the extent any such representation or warranty expressly speaks as of an earlier date, in which case such representation or warranty shall be true and correct in all material respects as of such earlier date. The Company shall have performed in all material respects all obligations and covenants herein required to be performed by it on or prior to the Closing Date.

(b) The Company shall have obtained any and all consents, permits, approvals, registrations and waivers necessary or appropriate for consummation of the Acquisition Transactions, the purchase and sale of the Shares and the consummation of the other transactions contemplated by the Acquisition Documents and the Transaction Documents, all of which shall be in full force and effect.

(d) The Company and each other party thereto shall have executed and delivered all of the Acquisition Documents, substantially in the forms provided to the Investors and their counsel.

(e) The Acquisition shall have been consummated pursuant to the terms of the Asset Purchase Agreement and the other Acquisition Documents. Without limiting the generality of the foregoing, no increase in the Acquisition Consideration shall have occurred, and there shall have been no amendment, modification, waiver or supplement of the Asset Purchase Agreement or any other Acquisition Document that is less favorable to the Company in the aggregate than the original terms of the Asset Purchase Agreement and the other Acquisition Documents.

(f) The Company shall have filed with Nasdaq a Notification Form: Listing of Additional Shares for the listing of the Shares on Nasdaq, a copy of which shall have been provided to the Investors, and Nasdaq shall not have raised any unresolved objection thereto.

(g) The Company shall have received confirmation that the full Purchase Price will be paid by the Investors upon the Closing.

(h) No judgment, writ, order, injunction, award or decree of or by any court, or judge, justice or magistrate, including any bankruptcy court or judge, or any order of or by any governmental authority, shall have been issued, and no action or proceeding shall have been instituted by any governmental authority, enjoining or preventing the consummation of any Acquisition Transaction, the sale of the Shares as contemplated hereby or the consummation of any other transaction contemplated by the Acquisition Documents and the Transaction Documents.

(i) The Company shall have delivered a Certificate, executed on behalf of the Company by its Chief Executive Officer or its Chief Financial Officer, dated as of the Closing Date, certifying to the fulfillment of the conditions specified in subsections (a), (b), (g), (h) and (l) of this Section 6.1.

(j) The Company shall have delivered a Certificate, executed on behalf of the Company by its Secretary, dated as of the Closing Date, certifying the resolutions adopted by the Board of Directors of the Company, or a duly appointed committee thereof, approving (i) the Acquisition Transactions and the Acquisition Documents to which the Company is a party, (ii) the sale of the Shares as contemplated by this Agreement and the consummation of the other transaction contemplated hereby and under the other Transaction Documents, (iii) certifying the current versions of the Certificate of Incorporation and Bylaws of the Company, and (iv) certifying as to the signatures and authority of persons signing the Transaction Documents and related documents on behalf of the Company.

(k) The Investors shall have received an opinion from Godfrey & Kahn S.C., the Company’s counsel with respect to the transactions contemplated by the Transaction Documents, dated as of the Closing Date, in form and substance reasonably acceptable to the Investors and addressing such legal matters as the Investors may reasonably request.

(l) No stop order or suspension of trading shall have been imposed by Nasdaq, the SEC or any other governmental or regulatory body with respect to public trading in the Common Stock.

6.2 Conditions to Obligations of the Company. The Company’s obligation to sell and issue the Shares at the Closing is subject to the satisfaction on or prior to the Closing Date of the following conditions, any of which may be waived by the Company:

(a) The representations and warranties made by the Investors in Section 5 hereof, other than the representations and warranties contained in Sections 5.3, 5.4, 5.5, 5.6, 5.7, 5.8 and 5.9 (the “Investment Representations”), shall be true and correct in all material respects when made, and shall be true and correct in all material respects on the Closing Date with the same force and effect as if they had been made on and as of said date. The Investment Representations shall be true and correct in all respects when made, and shall be true and correct in all respects on the Closing Date with the same force and effect as if they had been made on and as of said date. The Investors shall have performed in all material respects all obligations and covenants herein required to be performed by them on or prior to the Closing Date.

(b) The Investors shall have executed and delivered the Registration Rights Agreement.

6.3 Termination of Obligations to Effect Closing; Effects.

(a) The obligations of the Company, on the one hand, and the Investors, on the other hand, to effect the Closing shall terminate as follows:

(i) Upon the mutual written consent of the Company and the Investors;

(ii) By the Company if any of the conditions set forth in Section 6.2 shall have become incapable of fulfillment, and shall not have been waived by the Company;

(iii) By an Investor (with respect to itself only) if any of the conditions set forth in Section 6.1 shall have become incapable of fulfillment, and shall not have been waived by the Investor; or

(iv) By either the Company or any Investor (with respect to itself only) if the Closing has not occurred on or prior to November 22, 2019;

provided, however, that, except in the case of clause (i) above, the party seeking to terminate its obligation to effect the Closing shall not then be in breach of any of its representations, warranties, covenants or agreements contained in this Agreement or the other Transaction Documents if such breach has resulted in the circumstances giving rise to such party’s seeking to terminate its obligation to effect the Closing.

(b) In the event of termination by the Company or any Investor of its obligations to effect the Closing pursuant to this Section 6.3, written notice thereof shall forthwith be given to the other Investors by the Company and the other Investors shall have the right to terminate their obligations to effect the Closing upon written notice to the Company and the other Investors. Nothing in this Section 6.3 shall be deemed to release any party from any liability for any breach by such party of the terms and provisions of this Agreement or the other Transaction Documents or to impair the right of any party to compel specific performance by any other party of its obligations under this Agreement or the other Transaction Documents.

7. Covenants and Agreements of the Company.

7.1 [RESERVED]

7.2 Reports. The Company will furnish to the Investors and/or their assignees such information relating to the Company and its Subsidiaries as from time to time may reasonably be requested by the Investors and/or their assignees; provided, however, that the Company shall not disclose material nonpublic information to the Investors, or to advisors to or representatives of the Investors, unless prior to disclosure of such information the Company identifies such information as being material nonpublic information and provides the Investors, such advisors and representatives with the opportunity to accept or refuse to accept such material nonpublic information for review and any Investor wishing to obtain such information enters into an appropriate confidentiality agreement with the Company with respect thereto.

7.3 No Conflicting Agreements. The Company will not take any action, enter into any agreement or make any commitment that would conflict or interfere in any material respect with the Company’s obligations to the Investors under the Transaction Documents.

7.4 Insurance. The Company shall maintain in full force and effect insurance coverage that is customary for comparably situated companies for the business being conducted and properties owned or leased by the Company and each Subsidiary, which the Company reasonably believes such insurance coverage to be adequate against all liabilities, claims and risks against which it is customary for comparably situated companies to insure.

7.5 Compliance with Laws. The Company will comply in all material respects with all applicable laws, rules, regulations, orders and decrees of all governmental authorities.

7.6 Listing of Underlying Shares and Related Matters. Promptly following the date hereof, the Company shall take all necessary action to cause the Shares to be listed on Nasdaq no later than the Closing Date. Further, if the Company applies to have its Common Stock or other securities traded on any other principal stock exchange or market, it shall include in such application the Shares and will take such other action as is necessary to cause such Common Stock to be so listed. The Company will use commercially reasonable efforts to continue the listing and trading of its Common Stock on Nasdaq and, in accordance, therewith, will use commercially reasonable efforts to comply in all respects with the Company’s reporting, filing and other obligations under the bylaws or rules of such market or exchange, as applicable.

7.7 Termination of Covenants. The provisions of Sections 7.2 through 7.5 shall terminate and be of no further force and effect on the date on which the Company’s obligations under the Registration Rights Agreement to register or maintain the effectiveness of any registration covering the Registrable Securities (as such term is defined in the Registration Rights Agreement) shall terminate.

7.8 Removal of Legends. In connection with any sale or disposition of the Shares by an Investor in accordance with Rule 144 or in accordance with any other exemption under the 1933 Act such that the purchaser acquires freely tradable shares and upon compliance by the Investor with the requirements of this Agreement, the Company shall cause the transfer agent for the Common Stock (the “Transfer Agent”) to issue replacement certificates representing the Shares sold or disposed of without restrictive legends. Upon the earlier of (i) registration for resale pursuant to the Registration Rights Agreement or (ii) the Shares becoming freely tradable by a non-affiliate pursuant to Rule 144 the Company shall (A) deliver to the Transfer Agent irrevocable instructions that the Transfer Agent shall reissue a certificate representing shares of Common Stock without legends upon receipt by such Transfer Agent of the legended certificates for such shares, together with either (1) a customary representation by the Investor that Rule 144 applies to the shares of Common Stock represented thereby or (2) a statement by the Investor that such Investor will sell (or, in the case of any Affiliate of the Company has sold) the shares of Common Stock represented thereby in accordance with the Plan of Distribution contained in the Registration Statement, and (B) cause its counsel to deliver to the Transfer Agent one or more blanket opinions to the effect that the removal of such legends in such circumstances may be effected under the 1933 Act. From and after the earlier of such dates, upon an Investor’s written request, the Company shall promptly cause certificates evidencing the Investor’s Shares to be replaced with certificates which do not bear such restrictive legends. When the Company is required to cause an unlegended certificate to replace a previously issued legended certificate, if: (1) the unlegended certificate is not delivered to an Investor within two (2) Business Days of submission by that Investor of a legended certificate and supporting documentation to the Transfer Agent as provided above and (2) prior to the time such unlegended certificate is received by the Investor, the Investor, or any third party on behalf of such Investor or for the Investor’s account, purchases (in an open market transaction or otherwise) shares of Common Stock to deliver in satisfaction of a sale by the Investor of shares represented by such certificate (a “Buy-In”), then the Company shall pay in cash to the Investor (for the documented costs incurred either directly by such Investor or on behalf of a third party) the amount by which the total purchase price paid for Common Stock as a result of the Buy-In (including brokerage commissions, if any) exceeds the proceeds received by such Investor as a result of the sale to which such Buy-In relates. The Investor shall provide the Company written notice indicating the amounts payable to the Investor in respect of the Buy-In.

7.9 Subsequent Equity Sales; Registration Statements.

(a) From the date hereof until ninety (90) days after the Closing Date, without the consent of the Required Investors, neither the Company nor any Subsidiary shall issue shares of Common Stock or Common Stock Equivalents. Notwithstanding the foregoing, the provisions of this Section 7.9(a) shall not apply to (i) the issuance of the Shares, (ii) the issuance of Common Stock or Common Stock Equivalents upon the conversion or exercise of any securities of the Company or a Subsidiary outstanding on the date hereof, provided that the terms of such security are not amended after the date hereof to decrease the exercise price or increase the Common Stock or Common Stock Equivalents receivable upon the exercise, conversion or exchange thereof, or (iii) the issuance of any Common Stock or Common Stock Equivalents pursuant to any Company equity incentive plan approved by the Company’s stockholders and in place as of the date hereof.

(b) Without the prior written consent of the Required Investors, from the date hereof until the earlier of (i) three years from the Closing Date or (ii) such time as no Investor holds any of the Shares, the Company shall be prohibited from effecting or entering into an agreement to effect any “Variable Rate Transaction”. The term “Variable Rate Transaction” shall mean a transaction in which the Company issues or sells (i) any debt or equity securities that are convertible into, exchangeable or exercisable for, or include the right to receive additional shares of Common Stock either (A) at a conversion, exercise or exchange rate or other price that is based upon and/or varies with the trading prices of or quotations for the shares of Common Stock at any time after the initial issuance of such debt or equity securities, or (B) with a conversion, exercise or exchange price that is subject to being reset at some future date after the initial issuance of such debt or equity security or upon the occurrence of specified or contingent events directly or indirectly related to the business of the Company or the market for the Common Stock or (ii) enters into any agreement, including, but not limited to, an equity line of credit, whereby the Company may sell securities at a future determined price. For the avoidance of doubt, the issuance of a security which is subject to customary anti-dilution protections, including where the conversion, exercise or exchange price is subject to adjustment as a result of stock splits, reverse stock splits and other similar recapitalization or reclassification events, shall not be deemed to be a “Variable Rate Transaction.”

(c) The Company shall not, and shall use its commercially reasonable efforts to ensure that no Affiliate of the Company shall, sell, offer for sale or solicit offers to buy or otherwise negotiate in respect of any security (as defined in Section 2 of the 1933 Act) that will be integrated with the offer or sale of the Securities in a manner that would require the registration under the 1933 Act of the sale of the Shares to the Investors, or that will be integrated with the offer or sale of the Shares for purposes of the rules and regulations of any trading market such that it would require stockholder approval prior to the closing of such other transaction unless stockholder approval is obtained before the closing of such subsequent transaction.

(d) The Company shall not, from the date hereof until ninety (90) days after the Effective Date, prepare and file with the SEC a registration statement relating to an offering for its own account or the account of others under the 1933 Act of any of its equity securities, other than (i) a Registration Statement pursuant to the Registration Rights Agreement or (ii) any registration statement or post-effective amendment to a registration statement (or supplement thereto) relating to the Company’s employee benefit plans registered on Form S-8 or, in connection with an acquisition, on Form S-4.

7.10 Equal Treatment of Investors. No consideration shall be offered or paid to any Person to amend or consent to a waiver or modification of any provision of any of the Transaction Documents unless the same consideration is also offered to all of the parties to the Transaction Documents. For clarification purposes, this provision constitutes a separate right granted to each Investor by the Company and negotiated separately by each Investor, and is intended for the Company to treat the Investors as a class and shall not in any way be construed as the Investors acting in concert or as a group with respect to the purchase, disposition or voting of Securities or otherwise.

8. Survival and Indemnification.

8.1 Survival. The representations, warranties, covenants and agreements contained in this Agreement shall survive the Closing of the transactions contemplated by this Agreement.

8.2 Indemnification. The Company agrees to indemnify and hold harmless each Investor and its Affiliates and their respective directors, officers, trustees, partners, members, managers, employees and agents, and their respective successors and assigns, from and against any and all losses, claims, damages, liabilities and expenses (including without limitation reasonable attorney fees and disbursements and other reasonable, documented expenses incurred in connection with investigating, preparing or defending any action, claim or proceeding, pending or threatened and the costs of enforcement thereof) (collectively, “Losses”) to which such Person may become subject as a result of any breach of representation, warranty, covenant or agreement made by or to be performed on the part of the Company under the Transaction Documents, and will reimburse any such Person for all such amounts as they are incurred by such Person.

8.3 Conduct of Indemnification Proceedings. Any person entitled to indemnification hereunder shall (i) give prompt notice to the indemnifying party of any claim with respect to which it seeks indemnification and (ii) permit such indemnifying party to assume the defense of such claim with counsel reasonably satisfactory to the indemnified party; provided that any person entitled to indemnification hereunder shall have the right to employ separate counsel and to participate in the defense of such claim, but the fees and expenses of such counsel shall be at the expense of such person unless (a) the indemnifying party has agreed to pay such fees or expenses, or (b) the indemnifying party shall have failed to assume the defense of such claim and employ counsel reasonably satisfactory to such person or (c) in the reasonable judgment of any such person, based upon written advice of its counsel, a conflict of interest exists between such person and the indemnifying party with respect to such claims (in which case, if the person notifies the indemnifying party in writing that such person elects to employ separate counsel at the expense of the indemnifying party, the indemnifying party shall not have the right to assume the defense of such claim on behalf of such person); and provided, further, that the failure of any indemnified party to give notice as provided herein shall not relieve the indemnifying party of its obligations hereunder, except to the extent that such failure to give notice shall materially adversely affect the indemnifying party in the defense of any such claim or litigation. It is understood that the indemnifying party shall not, in connection with any proceeding in the same jurisdiction, be liable for fees or expenses of more than one separate firm of attorneys at any time for all such indemnified parties. No indemnifying party will, except with the consent of the indemnified party, consent to entry of any judgment or enter into any settlement that does not include as an unconditional term thereof the giving by the claimant or plaintiff to such indemnified party of a release from all liability in respect of such claim or litigation.

9. Miscellaneous.

9.1 Successors and Assigns. This Agreement may not be assigned by a party hereto without the prior written consent of the Company or the Investors, as applicable, provided, however, that an Investor may assign its rights and delegate its duties hereunder in whole or in part to an Affiliate or to a third party acquiring some or all of its Securities in a transaction complying with applicable securities laws without the prior written consent of the Company or the other Investors. The provisions of this Agreement shall inure to the benefit of and be binding upon the respective permitted successors and assigns of the parties. Without limiting the generality of the foregoing, in the event that the Company is a party to a merger, consolidation, share exchange or similar business combination transaction in which the Common Stock is converted into the equity securities of another Person, from and after the effective time of such transaction, such Person shall, by virtue of such transaction, be deemed to have assumed the obligations of the Company hereunder, the term “Company” shall be deemed to refer to such Person and the term “Shares” shall be deemed to refer to the securities received by the Investors in connection with such transaction. Nothing in this Agreement, express or implied, is intended to confer upon any party other than the parties hereto or their respective successors and assigns any rights, remedies, obligations, or liabilities under or by reason of this Agreement, except as expressly provided in this Agreement.

9.2 Counterparts; Faxes. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. This Agreement may be delivered by facsimile or other form of electronic transmission, which shall be deemed an original.

9.3 Titles and Subtitles. The titles and subtitles used in this Agreement are used for convenience only and are not to be considered in construing or interpreting this Agreement.

9.4 Notices. Unless otherwise provided, any notice required or permitted under this Agreement shall be given in writing and shall be deemed effectively given as hereinafter described (i) if given by personal delivery, then such notice shall be deemed given upon such delivery, (ii) if given by telex or telecopier, then such notice shall be deemed given upon receipt of confirmation of complete transmittal, (iii) if given by electronic mail during normal business hours of the recipient, and if not sent during normal business hours, then on the recipient’s next business day, (iv) if given by mail, then such notice shall be deemed given upon the earlier of (A) receipt of such notice by the recipient or (B) three days after such notice is deposited in first class mail, postage prepaid, and (v) if given by an internationally recognized overnight air courier, then such notice shall be deemed given one Business Day after delivery to such carrier. All notices shall be addressed to the party to be notified at the address as follows, or at such other address as such party may designate by ten days’ advance written notice to the other party:

If to the Company:

SharpSpring, Inc.

5001 Celebration Pointe Avenue

Suite 410

Gainseville, Florida 32608

Attention: Brad Stanczak

E-mail: brad.stanczak@sharpspring.com

With a copy to:

Godfrey & Kahn S.C.

833 East Michigan Street

Suite 1800

Milwaukee, Wisconsin 53202-5615

Attention: C.J. Wauters, Esq.

Fax: (414) 273-5198

E-mail: cwauters@gklaw.com

If to the Investors:

to the addresses set forth on the signature pages hereto.

9.5 Expenses. The parties hereto shall pay their own costs and expenses in connection herewith, except that the Company shall pay to Lowenstein Sandler LLP a fee not to exceed $40,000, regardless of whether the transactions contemplated hereby are consummated; it being understood that Lowenstein Sandler LLP has only rendered legal advice to the Special Situations Funds participating in this transaction and not to the Company or any other Investor in connection with the transactions contemplated hereby, and that each of the Company and each Investor has relied for such matters on the advice of its own respective counsel. Such expenses shall be paid at the Closing or, if the Closing does not occur, within five (5) Business Days of the termination of this Agreement. The Company shall reimburse the Investors upon demand for all reasonable and documented out-of-pocket expenses incurred by the Investors, including without limitation reimbursement of attorneys’ fees and disbursements, in connection with any amendment, modification or waiver of this Agreement or the other Transaction Documents requested by the Company subsequent to the Closing. In the event that legal proceedings are commenced by any party to this Agreement against another party to this Agreement in connection with this Agreement or the other Transaction Documents, the party or parties which do not prevail in such proceedings shall severally, but not jointly, pay their pro rata share of the reasonable attorneys’ fees and other reasonable and documented out-of-pocket costs and expenses incurred by the prevailing party in such proceedings.

9.6 Amendments and Waivers. Any term of this Agreement may be amended and the observance of any term of this Agreement may be waived (either generally or in a particular instance and either retroactively or prospectively), only with the written consent of the Company and the Required Investors. Any amendment or waiver effected in accordance with this paragraph shall be binding upon each holder of any Securities purchased under this Agreement at the time outstanding, each future holder of all such Securities, and the Company.

9.7 Publicity. Except as set forth below, no public release or announcement concerning the transactions contemplated hereby shall be issued by the Company or the Investors without the prior consent of the Company (in the case of a release or announcement by the Investors) or the Investors (in the case of a release or announcement by the Company) (which consents shall not be unreasonably withheld), except as such release or announcement may be required by law or the applicable rules or regulations of any securities exchange or securities market, in which case the Company or the Investors, as the case may be, shall allow the Investors or the Company, as applicable, to the extent reasonably practicable in the circumstances, reasonable time to comment on such release or announcement in advance of such issuance. By 8:30 a.m. (New York City time) on the trading day immediately following the execution and delivery of this Agreement, the Company shall issue a press release (the “Press Release”) (A) disclosing the execution of the Asset Purchase Agreement, (B) describing the Acquisition and the consummation of the other Acquisition Transactions contemplated by the Acquisition Documents, (C) disclosing the execution of this Agreement and the other Transaction Documents, (D) describing the transactions contemplated hereby and by the other Transaction Documents, and (E) disclosing any other material nonpublic information regarding the Company or any other information to be included in the 8-K (as defined below). No later than one Business Day after the Closing Date, the Company shall file with the SEC a Current Report on Form 8-K (the “8-K”) attaching the Press Release as well as copies of the Acquisition Documents required to be filed with the SEC and the Transaction Documents. In addition, the Company will make such other filings and notices in the manner and time required by the SEC or Nasdaq.

9.8 Severability. Any provision of this Agreement that is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof but shall be interpreted as if it were written so as to be enforceable to the maximum extent permitted by applicable law, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction. To the extent permitted by applicable law, the parties hereby waive any provision of law which renders any provision hereof prohibited or unenforceable in any respect.

9.9 Entire Agreement. This Agreement, including the Exhibits and the Disclosure Schedules, and the other Transaction Documents constitute the entire agreement among the parties hereof with respect to the subject matter hereof and thereof and supersede all prior agreements and understandings, both oral and written, between the parties with respect to the subject matter hereof and thereof.

9.10 Further Assurances. The parties shall execute and deliver all such further instruments and documents and take all such other actions as may reasonably be required to carry out the transactions contemplated hereby and to evidence the fulfillment of the agreements herein contained.

9.11 Construction. The parties agree that they and/or their respective counsel have reviewed and had an opportunity to revise the Transaction Documents and, therefore, the normal rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall not be employed in the interpretation of the Transaction Documents or any amendments thereto.

9.112 Governing Law; Consent to Jurisdiction; Waiver of Jury Trial. This Agreement shall be governed by, and construed in accordance with, the internal laws of the State of New York without regard to the choice of law principles thereof. Each of the parties hereto irrevocably submits to the exclusive jurisdiction of the courts of the State of New York located in New York County and the United States District Court for the Southern District of New York for the purpose of any suit, action, proceeding or judgment relating to or arising out of this Agreement and the transactions contemplated hereby. Service of process in connection with any such suit, action or proceeding may be served on each party hereto anywhere in the world by the same methods as are specified for the giving of notices under this Agreement. Each of the parties hereto irrevocably consents to the jurisdiction of any such court in any such suit, action or proceeding and to the laying of venue in such court. Each party hereto irrevocably waives any objection to the laying of venue of any such suit, action or proceeding brought in such courts and irrevocably waives any claim that any such suit, action or proceeding brought in any such court has been brought in an inconvenient forum. EACH OF THE PARTIES HERETO WAIVES ANY RIGHT TO REQUEST A TRIAL BY JURY IN ANY LITIGATION WITH RESPECT TO THIS AGREEMENT AND THE OTHER TRANSACTION DOCUMENTS OR ARISING OUT OF THE TRANSACTIONS CONTEMPLATED HEREBY AND THEREBY AND REPRESENTS THAT COUNSEL HAS BEEN CONSULTED SPECIFICALLY AS TO THIS WAIVER.

9.13 Independent Nature of Investors’ Obligations and Rights. The obligations of each Investor under any Transaction Document are several and not joint with the obligations of any other Investor, and no Investor shall be responsible in any way for the performance of the obligations of any other Investor under any Transaction Document. The decision of each Investor to purchase Securities pursuant to the Transaction Documents has been made by such Investor independently of any other Investor. Nothing contained herein or in any Transaction Document, and no action taken by any Investor pursuant thereto, shall be deemed to constitute the Investors as a partnership, an association, a joint venture or any other kind of entity, or create a presumption that the Investors are in any way acting in concert or as a group with respect to such obligations or the transactions contemplated by the Transaction Documents. Each Investor acknowledges that no other Investor has acted as agent for such Investor in connection with making its investment hereunder and that no Investor will be acting as agent of such Investor in connection with monitoring its investment in the Securities or enforcing its rights under the Transaction Documents. Each Investor shall be entitled to independently protect and enforce its rights, including, without limitation, the rights arising out of this Agreement or out of the other Transaction Documents, and it shall not be necessary for any other Investor to be joined as an additional party in any proceeding for such purpose. The Company acknowledges that each of the Investors has been provided with the same Transaction Documents for the purpose of closing a transaction with multiple Investors and not because it was required or requested to do so by any Investor.

[signature page follows]

IN WITNESS WHEREOF, the parties have executed this Agreement or caused their duly authorized officers to execute this Agreement as of the date first above written.

The Company:

SHARPSPRING, INC.

By: /s/ Brad Stanczak

Name: Brad Stanczak

Title: Chief Financial Officer

The Investors:

SPECIAL SITUATIONS PRIVATE EQUITY FUND, L.P.

By: /s/ Adam Stettner

Name: Adam Stettner

Title: General Partner

Aggregate Purchase Price: $500,004

Number of Shares: 55,556

TIN: 13-3916551

Address for Notice:

527 Madison Avenue

Suite 2600

New York, NY 10022

Attn: Marianne Kelly

Telephone: 212.319.6625

Facsimile: 212.319.6677

E-mail: Marianne@ssfund.com

with a copy to:

Lowenstein Sandler LLP

65 Livingston Avenue

Roseland, NJ 07068

Attn: John D. Hogoboom, Esq.

Telephone: 973.597.2500

Facsimile: 973.597.2400

E-mail: jhogoboom@lowenstein.com

SPECIAL SITUATIONS TECHNOLOGY FUND, L.P.

By: /s/ Adam Stettner

Name: Adam Stettner

Title: General Partner

Aggregate Purchase Price: $319,995

Number of Shares: 35,555

TIN: 20-0051532

Address for Notice:

527 Madison Avenue

Suite 2600

New York, NY 10022

Attn: Marianne Kelly

Telephone: 212.319.6625

Facsimile: 212.319.6677

E-mail: Marianne@ssfund.com

with a copy to:

Lowenstein Sandler LLP

65 Livingston Avenue

Roseland, NJ 07068

Attn: John D. Hogoboom, Esq.

Telephone: 973.597.2500

Facsimile: 973.597.2400

E-mail: jhogoboom@lowenstein.com

SPECIAL SITUATIONS TECHNOLOGY FUND II, L.P.

By: /s/ Adam Stettner

Name: Adam Stettner

Title: General Partner

Aggregate Purchase Price: $1,680,003

Number of Shares: 186,667

TIN: 13-3937585

Address for Notice:

527 Madison Avenue

Suite 2600

New York, NY 10022

Attn: Marianne Kelly

Telephone: 212.319.6625

Facsimile: 212.319.6677

E-mail: Marianne@ssfund.com

with a copy to:

Lowenstein Sandler LLP

65 Livingston Avenue

Roseland, NJ 07068

Attn: John D. Hogoboom, Esq.

Telephone: 973.597.2500

Facsimile: 973.597.2400

E-mail: jhogoboom@lowenstein.com

GREENHAVEN ROAD CAPITAL FUND 1, LP

By: Greenhaven Road Investment Management, LP,

As Investment Manager

By:

/s/ Scott Stewart Miller, Jr.____

Name: Scott Stewart Miller, Jr.

Title: Authorized Signatory

Aggregate Purchase Price: $1,235,250

Number of Shares: 137,250

TIN: 45-4741929

Address for Notice:

8 Sound Shore Drive, Suite 190

Greenwich, CT 06830

Attn: Scott Stewart Miller, Jr.

Telephone: 917.880.2051

Facsimile: 203.584.9000

E-mail: Scott@greenhavenroad.com

GREENHAVEN ROAD CAPITAL FUND 2, LP

By: Greenhaven Road Investment Management, LP,

As Investment Manager

By:

/s/ Scott Stewart Miller, Jr.____

Name: Scott Stewart Miller, Jr.

Title: Authorized Signatory

Aggregate Purchase Price: $1,264,752

Number of Shares: 140,528

TIN: 82-3291170

Address for Notice:

8 Sound Shore Drive, Suite 190

Greenwich, CT 06830

Attn: Scott Stewart Miller, Jr.

Telephone: 917.880.2051

Facsimile: 203.584.9000

E-mail: Scott@greenhavenroad.com

Exhibit 10.2

REGISTRATION RIGHTS AGREEMENT

This Registration Rights Agreement (the “Agreement”) is made and entered into as of this 20th day of November, 2019 by and among SharpSpring, Inc., a Delaware corporation (the “Company”), and the “Investors” named in that certain Purchase Agreement by and among the Company and the Investors (the “Purchase Agreement”). Capitalized terms used herein have the respective meanings ascribed thereto in the Purchase Agreement unless otherwise defined herein.

The parties hereby agree as follows:

1. Certain Definitions.

As used in this Agreement, the following terms shall have the following meanings:

“Common Stock” means the Company’s common stock, par value $0.001 per share, and any securities into which such shares may hereinafter be reclassified.

“Investors” means the Investors identified in the Purchase Agreement and any Affiliate or permitted transferee of any Investor who is a subsequent holder of any Registrable Securities.

“Prospectus” means (i) any prospectus (preliminary or final) included in any Registration Statement, as amended or supplemented by any prospectus supplement, with respect to the terms of the offering of any portion of the Registrable Securities covered by such Registration Statement and by all other amendments and supplements to the prospectus, including post-effective amendments and all material incorporated by reference in such prospectus, and (ii) any “free writing prospectus” as defined in Rule 405 under the 1933 Act.

“Register,” “registered” and “registration” refer to a registration made by preparing and filing a Registration Statement or similar document in compliance with the 1933 Act (as defined below), and the declaration or ordering of effectiveness of such Registration Statement or document.

“Registrable Securities” means (i) the Shares and (ii) any other securities issued or issuable with respect to or in exchange for the Shares, whether by merger, charter amendment, or otherwise; provided, that, a security shall cease to be a Registrable Security (and the Company shall not be required to maintain the effectiveness of any, or file another, Registration Statement hereunder with respect thereto) for so long as (a) a Registration Statement with respect to the sale of such Registrable Securities is declared effective by the SEC under the 1933 Act and such Registrable Securities have been disposed of by the holder thereof in accordance with such effective Registration Statement, (b) such Registrable Securities have been previously sold in accordance with Rule 144, or (c) such securities become eligible for resale without volume or manner-of-sale restrictions and without current public information pursuant to Rule 144 as set forth in a written opinion letter to such effect, addressed, delivered and acceptable to the Transfer Agent and the affected holders (assuming that such securities and any securities issuable upon exercise, conversion or exchange of which, or as a dividend upon which, such securities were issued or are issuable, were at no time held by any Affiliate of the Company), as reasonably determined by the Company, upon the advice of counsel to the Company and the Transfer Agent has issued certificates for such Registrable Securities to the holder thereof, or as such holder may direct, without any restrictive legend.

“Registration Statement” means any registration statement of the Company filed under the 1933 Act that covers the resale of any of the Registrable Securities pursuant to the provisions of this Agreement, amendments and supplements to such Registration Statement, including post-effective amendments, all exhibits and all material incorporated by reference in such Registration Statement.

“Required Investors” means each Investor, who, together with its Affiliates, beneficially owns (calculated in accordance with Rule 13d-3 under the 1934 Act) at least 25% of the Registrable Securities and (B) the Investors who, together with their Affiliates, beneficially own (calculated in accordance with Rule 13d-3 under the 1934 Act) at least a majority of the Registrable Securities then owned by the Investors.

“SEC” means the U.S. Securities and Exchange Commission.

“1933 Act” means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.

“1934 Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.

2. Registration.

(a) Registration Statement. Promptly following the closing of the purchase and sale of the securities contemplated by the Purchase Agreement (the “Closing Date”) but no later than thirty (30) days after the Closing Date (the “Filing Deadline”), the Company shall prepare and file with the SEC one Registration Statement on Form S-3 covering the resale of the Registrable Securities. Subject to any SEC comments, such Registration Statement shall include the plan of distribution attached hereto as Exhibit A; provided, however, that no Investor shall be named as an “underwriter” in the Registration Statement without the Investor’s prior written consent. Such Registration Statement also shall cover, to the extent allowable under the 1933 Act and the rules promulgated thereunder (including Rule 416), such indeterminate number of additional shares of Common Stock resulting from stock splits, stock dividends or similar transactions with respect to the Registrable Securities. Such Registration Statement shall not include any shares of Common Stock or other securities for the account of any other holder without the prior written consent of the Required Investors. The Registration Statement (and each amendment or supplement thereto, and each request for acceleration of effectiveness thereof) shall be provided in accordance with Section 3(c) to the Investors and their counsel prior to its filing or other submission. If a Registration Statement covering the Registrable Securities is not filed with the SEC on or prior to the Filing Deadline, the Company will make pro rata payments to each Investor, as liquidated damages and not as a penalty, in an amount equal to 1.5% of the aggregate amount invested by such Investor pursuant to the Purchase Agreement for each 30-day period or pro rata for any portion thereof following the Filing Deadline for which no Registration Statement is filed with respect to the Registrable Securities. Such payments shall constitute the Investors’ exclusive monetary remedy for such events, but shall not affect the right of the Investors to seek injunctive relief. Such payments shall be made to each Investor in cash no later than three (3) Business Days after the end of each 30-day period.

(b) Expenses. The Company will pay all expenses associated with effecting the registration of the Registrable Securities, including filing and printing fees, the Company’s counsel and accounting fees and expenses, costs associated with clearing the Registrable Securities for sale under applicable state securities laws, listing fees, documented fees and out-of-pocket expenses of one counsel to the Investors up to an aggregate of $10,000 and the Investors’ other reasonable out-of-pocket expenses in connection with the registration, but excluding discounts, commissions, fees of underwriters, selling brokers, dealer managers or similar securities industry professionals with respect to the Registrable Securities being sold.

(i) The Company shall use commercially reasonable efforts to have any Registration Statement declared effective as soon as practicable. The Company shall notify the Investors by facsimile or e-mail as promptly as practicable, and in any event, within twenty-four (24) hours, after any Registration Statement is declared effective and shall simultaneously provide the Investors with copies of any related Prospectus to be used in connection with the sale or other disposition of the securities covered thereby. If (A) a Registration Statement covering the Registrable Securities is not declared effective by the SEC prior to the earlier of (i) five (5) Business Days after the SEC shall have informed the Company that no review of the Registration Statement will be made or that the SEC has no further comments on the Registration Statement or (ii) the 90th day after the Closing Date, or (B) after a Registration Statement has been declared effective by the SEC, sales cannot be made pursuant to such Registration Statement for any reason (including without limitation by reason of a stop order, or the Company’s failure to update the Registration Statement), but excluding any Allowed Delay (as defined below) or the inability of any Investor to sell the Registrable Securities covered thereby due to market conditions, then the Company will make pro rata payments to each Investor, as liquidated damages and not as a penalty, in an amount equal to 1.5% of the aggregate amount invested by such Investor pursuant to the Purchase Agreement for each 30-day period or pro rata for any portion thereof following the date by which such Registration Statement should have been effective (the “Blackout Period”). Such payments shall constitute the Investors’ exclusive monetary remedy for such events, but shall not affect the right of the Investors to seek injunctive relief. The amounts payable as liquidated damages pursuant to this paragraph shall be paid monthly within three (3) Business Days of the last day of each month following the commencement of the Blackout Period until the termination of the Blackout Period. Such payments shall be made to each Investor in cash.

(ii) For not more than twenty (20) consecutive days or for a total of not more than forty-five (45) days in any twelve (12) month period, the Company may suspend the use of any Prospectus included in any Registration Statement contemplated by this Section in the event that the Company determines in good faith that such suspension is necessary to (A) delay the disclosure of material non-public information concerning the Company, the disclosure of which at the time is not, in the good faith opinion of the Company, in the best interests of the Company or (B) amend or supplement the affected Registration Statement or the related Prospectus so that such Registration Statement or Prospectus shall not include an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in the case of the Prospectus in light of the circumstances under which they were made, not misleading (an “Allowed Delay”); provided, that the Company shall promptly (a) notify each Investor in writing of the commencement of an Allowed Delay, but shall not (without the prior written consent of an Investor) disclose to such Investor any material non-public information giving rise to an Allowed Delay, (b) advise the Investors in writing to cease all sales under the Registration Statement until the end of the Allowed Delay and (c) use commercially reasonable efforts to terminate an Allowed Delay as promptly as practicable.

(d) Rule 415; Cutback If at any time the SEC takes the position that the offering of some or all of the Registrable Securities in a Registration Statement is not eligible to be made on a delayed or continuous basis under the provisions of Rule 415 under the 1933 Act or requires any Investor to be named as an “underwriter”, the Company shall use its best efforts to persuade the SEC that the offering contemplated by a Registration Statement is a bona fide secondary offering and not an offering “by or on behalf of the issuer” as defined in Rule 415 and that none of the Investors is an “underwriter”. The Investors shall have the right to participate or have their counsel participate in any meetings or discussions with the SEC regarding the SEC’s position and to comment or have their counsel comment on any written submission made to the SEC with respect thereto. No such written submission shall be made to the SEC to which the Investors’ counsel reasonably objects. In the event that, despite the Company’s best efforts and compliance with the terms of this Section 2(d), the SEC refuses to alter its position, the Company shall (i) remove from the Registration Statement such portion of the Registrable Securities (the “Cut Back Shares”) and/or (ii) agree to such restrictions and limitations on the registration and resale of the Registrable Securities as the SEC may require to assure the Company’s compliance with the requirements of Rule 415 (collectively, the “SEC Restrictions”); provided, however, that the Company shall not agree to name any Investor as an “underwriter” in such Registration Statement without the prior written consent of such Investor. Any cut-back imposed on the Investors pursuant to this Section 2(d) shall be allocated among the Investors on a pro rata basis, unless the SEC Restrictions otherwise require or provide or the Investors otherwise agree. No liquidated damages shall accrue as to any Cut Back Shares until such date as the Company is able to effect the registration of such Cut Back Shares in accordance with any SEC Restrictions (such date, the “Restriction Termination Date” of such Cut Back Shares). From and after the Restriction Termination Date applicable to any Cut Back Shares, all of the provisions of this Section 2 (including the liquidated damages provisions) shall again be applicable to such Cut Back Shares; provided, however, that (i) the Filing Deadline for the Registration Statement including such Cut Back Shares shall be ten (10) Business Days after such Restriction Termination Date, and (ii) the date by which the Company is required to obtain effectiveness with respect to such Cut Back Shares under Section 2(c) shall be the 60th day immediately after the Restriction Termination Date.

(e) Right to Piggyback Registration.

(i) If at any time following the date of this Agreement that any Registrable Securities remain outstanding and are not freely tradable under Rule 144 (A) there is not one or more effective Registration Statements covering all of the Registrable Securities and (B) the Company proposes for any reason to register any shares of Common Stock under the 1933 Act (other than pursuant to a registration statement on Form S-4 or Form S-8 (or a similar or successor form)) with respect to an offering of Common Stock by the Company for its own account or for the account of any of its stockholders, it shall at each such time promptly give written notice to the holders of the Registrable Securities of its intention to do so (but in no event less than twenty (20) days before the anticipated filing date) and, to the extent permitted under the provisions of Rule 415 under the 1933 Act, include in such registration all Registrable Securities with respect to which the Company has received written requests for inclusion therein within ten (10) days after receipt of the Company’s notice (a “Piggyback Registration”). Such notice shall offer the holders of the Registrable Securities the opportunity to register such number of shares of Registrable Securities as each such holder may request and shall indicate the intended method of distribution of such Registrable Securities.

(ii) Notwithstanding the foregoing, (A) if such registration involves an underwritten public offering, the Investors must sell their Registrable Securities to, if applicable, the underwriter(s) at the same price and subject to the same underwriting discounts and commissions that apply to the other securities sold in such offering (it being acknowledged that the Company shall be responsible for other expenses as set forth in Section 2(b)) and subject to the Investors entering into customary underwriting documentation for selling stockholders in an underwritten public offering, and (B) if, at any time after giving written notice of its intention to register any Registrable Securities pursuant to Section 2(e)(i) and prior to the effective date of the registration statement filed in connection with such registration, the Company shall determine for any reason not to cause such registration statement to become effective under the 1933 Act, the Company shall deliver written notice to the Investors and, thereupon, shall be relieved of its obligation to register any Registrable Securities in connection with such registration; provided, however, that nothing contained in this Section 2(e)(ii) shall limit the Company’s liabilities and/or obligations under this Agreement, including, without limitation, the obligation to pay liquidated damages under this Section 2.

(iii) If a Piggyback Registration is initiated as a primary underwritten offering on behalf of the Company and the managing underwriter advises the Company and the holders of Registrable Securities (if any holders of Registrable Securities have elected to include Registrable Securities in such Piggyback Registration) in writing that in its reasonable and good faith opinion the number of shares of Common Stock proposed to be included in such registration, including all Registrable Securities and all other shares of Common Stock proposed to be included on behalf of the Company in such underwritten offering, exceeds the number of shares of Common Stock which can be sold in such offering and/or that the number of shares of Common Stock proposed to be included in any such registration would adversely affect the price per share of the Common Stock to be sold in such offering, the Company shall include in such registration or takedown (i) first, the shares of Common Stock that the Company proposes to sell; and (ii) second, the shares of Common Stock requested to be included therein by holders of Registrable Securities, allocated pro rata among all such holders on the basis of the number of Registrable Securities owned by each such holder or in such manner as they may otherwise agree.

3. Company Obligations. The Company will use commercially reasonable efforts to effect the registration of the Registrable Securities in accordance with the terms hereof, and pursuant thereto the Company will, as expeditiously as possible:

(a) use commercially reasonable efforts to cause such Registration Statement to become effective and to remain continuously effective for a period that will terminate upon the earlier of (i) the date on which all Registrable Securities covered by such Registration Statement as amended from time to time, have been sold or otherwise disposed of pursuant to the Registration Statement or in a transaction in which the transferee receives freely tradable shares., and (ii) the date on which the Registrable Securities no longer constitute “Registrable Securities” pursuant to the definition thereof (the “Effectiveness Period”) and advise the Investors in writing when the Effectiveness Period has expired;

(b) prepare and file with the SEC such amendments and post-effective amendments to the Registration Statement and the Prospectus as may be necessary to keep the Registration Statement effective for the Effectiveness Period and to comply with the provisions of the 1933 Act and the 1934 Act with respect to the distribution of all of the Registrable Securities covered thereby;

(c) provide copies to and permit counsel designated by the Investors to review each Registration Statement and all amendments and supplements thereto no fewer than seven (7) days prior to their filing with the SEC and not file any document to which such counsel reasonably objects;

(d) furnish to the Investors and their legal counsel (i) promptly after the same is prepared and publicly distributed, filed with the SEC, or received by the Company (but not later than two (2) Business Days after the filing date, receipt date or sending date, as the case may be) one (1) copy of any Registration Statement and any amendment thereto, each preliminary prospectus and Prospectus and each amendment or supplement thereto, and each letter written by or on behalf of the Company to the SEC or the staff of the SEC, and each item of correspondence from the SEC or the staff of the SEC, in each case relating to such Registration Statement (other than any portion thereof which contains information for which the Company has sought confidential treatment), and (ii) such number of copies of a Prospectus, including a preliminary prospectus, and all amendments and supplements thereto and such other documents as each Investor may reasonably request in order to facilitate the disposition of the Registrable Securities owned by such Investor that are covered by the related Registration Statement;

(e) use commercially reasonable efforts to (i) prevent the issuance of any stop order or other suspension of effectiveness and, (ii) if such order is issued, obtain the withdrawal of any such order at the earliest possible moment;

(f) prior to any public offering of Registrable Securities, use commercially reasonable efforts to register or qualify or cooperate with the Investors and their counsel in connection with the registration or qualification of such Registrable Securities for offer and sale under the securities or blue sky laws of such jurisdictions requested by the Investors and do any and all other commercially reasonable acts or things necessary or advisable to enable the distribution in such jurisdictions of the Registrable Securities covered by the Registration Statement; provided, however, that the Company shall not be required in connection therewith or as a condition thereto to (i) qualify to do business in any jurisdiction where it would not otherwise be required to qualify but for this Section 3(f), (ii) subject itself to general taxation in any jurisdiction where it would not otherwise be so subject but for this Section 3(f), or (iii) file a general consent to service of process in any such jurisdiction;

(g) use commercially reasonable efforts to cause all Registrable Securities covered by a Registration Statement to be listed (or continue to be listed) on each securities exchange, interdealer quotation system or other market on which similar securities issued by the Company are then listed;

(h) immediately notify the Investors, at any time prior to the end of the Effectiveness Period, upon discovery that, or upon the happening of any event as a result of which, the Prospectus includes an untrue statement of a material fact or omits to state any material fact required to be stated therein or necessary to make the statements therein not misleading in light of the circumstances then existing, and promptly prepare, file with the SEC and furnish to such holder a supplement to or an amendment of such Prospectus as may be necessary so that such Prospectus shall not include an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading in light of the circumstances then existing;

(i) otherwise use commercially reasonable efforts to comply with all applicable rules and regulations of the SEC under the 1933 Act and the 1934 Act, including, without limitation, Rule 172 under the 1933 Act, file any final Prospectus, including any supplement or amendment thereof, with the SEC pursuant to Rule 424 under the 1933 Act, promptly inform the Investors in writing if, at any time during the Effectiveness Period, the Company does not satisfy the conditions specified in Rule 172 and, as a result thereof, the Investors are required to deliver a Prospectus in connection with any disposition of Registrable Securities and take such other actions as may be reasonably necessary to facilitate the registration of the Registrable Securities hereunder; and make available to its security holders, as soon as reasonably practicable, but not later than the Availability Date (as defined below), an earnings statement covering a period of at least twelve (12) months, beginning after the effective date of each Registration Statement, which earnings statement shall satisfy the provisions of Section 11(a) of the 1933 Act, including Rule 158 promulgated thereunder (for the purpose of this subsection 3(i), “Availability Date” means the 45th day following the end of the fourth fiscal quarter that includes the effective date of such Registration Statement, except that, if such fourth fiscal quarter is the last quarter of the Company’s fiscal year, “Availability Date” means the 90th day after the end of such fourth fiscal quarter); and

(j) With a view to making available to the Investors the benefits of Rule 144 (or its successor rule) and any other rule or regulation of the SEC that may at any time permit the Investors to sell shares of Common Stock to the public without registration, the Company covenants and agrees to: (i) make and keep public information available, as those terms are understood and defined in Rule 144, until the earlier of (A) six months after such date as all of the Registrable Securities may be sold without restriction by the holders thereof pursuant to Rule 144 or any other rule of similar effect or (B) such date as all of the Registrable Securities shall have been resold pursuant to a Registration Statement, Rule 144 or otherwise in a transaction in which the transferee receives freely tradable shares; (ii) file with the SEC in a timely manner all reports and other documents required of the Company under the 1934 Act; and (iii) furnish to each Investor upon request, as long as such Investor owns any Registrable Securities, (A) a written statement by the Company that it has complied with the reporting requirements of the 1934 Act, (B) a copy of the Company’s most recent Annual Report on Form 10-K or Quarterly Report on Form 10-Q, and (C) such other information as may be reasonably requested in order to avail such Investor of any rule or regulation of the SEC that permits the selling of any such Registrable Securities without registration. In the event that the Company fails to comply with the requirements of this Section 3(j) after the 180th day after the Closing Date, the Company will make pro rata payments to each Investor, as liquidated damages and not as a penalty, in an amount equal to 1.5% of the aggregate amount invested by such Investor pursuant to the Purchase Agreement for each 30-day period or pro rata for any portion thereof until such failure is cured; provided, however, that only Investors that have not sold or otherwise disposed of all of their Registrable Securities prior to such failure shall be entitled to receive liquidated damages pursuant to this Section 3. Such payments shall constitute the Investors’ exclusive monetary remedy for such events, but shall not affect the right of the Investors to seek injunctive relief. Such payments shall be made to each Investor in cash no later than three (3) Business Days after the end of each 30-day period.

4. Due Diligence Review; Information. The Company shall make available, during normal business hours, for inspection and review by the Investors, advisors to and representatives of the Investors (who may or may not be affiliated with the Investors and who are reasonably acceptable to the Company), all financial and other records, all SEC Filings (as defined in the Purchase Agreement) and other filings with the SEC, and all other corporate documents and properties of the Company as may be reasonably necessary for the purpose of enabling the Investors to obtain the benefits of the defense to liability specified in Sections 11(b)(3) and 12(a)(2) of the 1933 Act (collectively, the “Due Diligence Defense”), and cause the Company’s officers, directors and employees, within a reasonable time period, to supply all such information reasonably requested by the Investors or any such representative, advisor or underwriter in connection therewith (including, without limitation, in response to all questions and other inquiries reasonably made or submitted by any of them), prior to and from time to time after the filing and effectiveness of the Registration Statement for the sole purpose of enabling the Investors and such representatives, advisors and underwriters and their respective accountants and attorneys to conduct the inquiry required for the Investors to obtain the benefit of the Due Diligence Defense with respect to such Registration Statement.

Notwithstanding the foregoing, the Company shall not disclose material nonpublic information to the Investors, or to advisors to or representatives of the Investors, unless prior to disclosure of such information the Company identifies such information as being material nonpublic information and provides the Investors, such advisors and representatives with the opportunity to accept or refuse to accept such material nonpublic information for review and any Investor wishing to obtain such information enters into an appropriate confidentiality agreement with the Company with respect thereto.

5. Obligations of the Investors.

(a) Each Investor shall furnish in writing to the Company such information regarding itself, the Registrable Securities held by it and the intended method of disposition of the Registrable Securities held by it, as shall be reasonably required to effect the registration of such Registrable Securities and shall execute such documents in connection with such registration as the Company may reasonably request. At least five (5) Business Days prior to the first anticipated filing date of any Registration Statement, the Company shall notify each Investor of the information the Company requires from such Investor if such Investor elects to have any of the Registrable Securities included in the Registration Statement. An Investor shall provide such information to the Company at least two (2) Business Days prior to the first anticipated filing date of such Registration Statement if such Investor elects to have any of the Registrable Securities included in the Registration Statement.

(b) Each Investor, by its acceptance of the Registrable Securities agrees to cooperate with the Company as reasonably requested by the Company in connection with the preparation and filing of a Registration Statement hereunder, unless such Investor has notified the Company in writing of its election to exclude all of its Registrable Securities from such Registration Statement.

(c) Each Investor agrees that, upon receipt of any notice from the Company of either (i) the commencement of an Allowed Delay pursuant to Section 2(c)(ii) or (ii) the happening of an event pursuant to Section 3(h) hereof, such Investor will immediately discontinue disposition of Registrable Securities pursuant to the Registration Statement covering such Registrable Securities, until the Investor is advised by the Company that such dispositions may again be made.

6. Indemnification.

(a) Indemnification by the Company. The Company will indemnify and hold harmless each Investor and its officers, directors, members, managers, partners, trustees, employees and agents and other representatives, successors and assigns, and each other person, if any, who controls such Investor within the meaning of the 1933 Act, against any losses, claims, damages or liabilities, joint or several, to which they may become subject under the 1933 Act or otherwise, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon: (i) any untrue statement or alleged untrue statement or omission or alleged omission of any material fact contained in any Registration Statement, any Prospectus, or any amendment or supplement thereof; (ii) any blue sky application or other document executed by the Company specifically for that purpose or based upon written information furnished by the Company filed in any state or other jurisdiction in order to qualify any or all of the Registrable Securities under the securities laws thereof (any such application, document or information herein called a “Blue Sky Application”); (iii) the omission or alleged omission to state in a Blue Sky Application a material fact required to be stated therein or necessary to make the statements therein not misleading; (iv) any violation by the Company or its agents of any rule or regulation promulgated under the 1933 Act applicable to the Company or its agents and relating to action or inaction required of the Company in connection with such registration; or (v) any failure to register or qualify the Registrable Securities included in any such Registration Statement in any state where the Company or its agents has affirmatively undertaken or agreed in writing that the Company will undertake such registration or qualification on an Investor’s behalf and will reimburse such Investor, and each such officer, director or member and each such controlling person for any documented legal or other out-of-pocket expenses reasonably incurred by them in connection with investigating or defending any such loss, claim, damage, liability or action; provided, however, that the Company will not be liable in any such case if and to the extent that any such loss, claim, damage or liability arises out of or is based upon an untrue statement or alleged untrue statement or omission or alleged omission so made in conformity with information furnished by such Investor or any such controlling person in writing specifically for use in such Registration Statement or Prospectus.

(b) Indemnification by the Investors. Each Investor agrees, severally but not jointly, to indemnify and hold harmless, to the fullest extent permitted by law, the Company, its directors, officers, employees, stockholders and each person who controls the Company (within the meaning of the 1933 Act) against any losses, claims, damages, liabilities and expense (including reasonable attorney fees) resulting from any untrue statement of a material fact or any omission of a material fact required to be stated in the Registration Statement or Prospectus or amendment or supplement thereto or necessary to make the statements therein not misleading, to the extent, but only to the extent that such untrue statement or omission is contained in any information furnished in writing by such Investor to the Company specifically for inclusion in such Registration Statement or Prospectus or amendment or supplement thereto. In no event shall the liability of an Investor be greater in amount than the dollar amount of the proceeds (net of all expenses paid by such Investor in connection with any claim relating to this Section 6 and the amount of any damages such Investor has otherwise been required to pay by reason of such untrue statement or omission) received by such Investor upon the sale of the Registrable Securities included in the Registration Statement giving rise to such indemnification obligation.

(c) Conduct of Indemnification Proceedings. Any person entitled to indemnification hereunder shall (i) give prompt notice to the indemnifying party of any claim with respect to which it seeks indemnification and (ii) permit such indemnifying party to assume the defense of such claim with counsel reasonably satisfactory to the indemnified party; provided that any person entitled to indemnification hereunder shall have the right to employ separate counsel and to participate in the defense of such claim, but the fees and expenses of such counsel shall be at the expense of such person unless (a) the indemnifying party has agreed to pay such fees or expenses, or (b) the indemnifying party shall have failed to assume the defense of such claim and employ counsel reasonably satisfactory to such person or (c) in the reasonable judgment of any such person, based upon written advice of its counsel, a conflict of interest exists between such person and the indemnifying party with respect to such claims (in which case, if the person notifies the indemnifying party in writing that such person elects to employ separate counsel at the expense of the indemnifying party, the indemnifying party shall not have the right to assume the defense of such claim on behalf of such person); and provided, further, that the failure of any indemnified party to give notice as provided herein shall not relieve the indemnifying party of its obligations hereunder, except to the extent that such failure to give notice shall materially adversely affect the indemnifying party in the defense of any such claim or litigation. It is understood that the indemnifying party shall not, in connection with any proceeding in the same jurisdiction, be liable for fees or expenses of more than one separate firm of attorneys at any time for all such indemnified parties. No indemnifying party will, except with the consent of the indemnified party, consent to entry of any judgment or enter into any settlement that does not include as an unconditional term thereof the giving by the claimant or plaintiff to such indemnified party of a release from all liability in respect of such claim or litigation.

(d) Contribution. If for any reason the indemnification provided for in the preceding paragraphs (a) and (b) is unavailable to an indemnified party or insufficient to hold it harmless, other than as expressly specified therein, then the indemnifying party shall contribute to the amount paid or payable by the indemnified party as a result of such loss, claim, damage or liability in such proportion as is appropriate to reflect the relative fault of the indemnified party and the indemnifying party, as well as any other relevant equitable considerations. No person guilty of fraudulent misrepresentation within the meaning of Section 11(f) of the 1933 Act shall be entitled to contribution from any person not guilty of such fraudulent misrepresentation. In no event shall the contribution obligation of a holder of Registrable Securities be greater in amount than the dollar amount of the proceeds (net of all expenses paid by such holder in connection with any claim relating to this Section 6 and the amount of any damages such holder has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission) received by it upon the sale of the Registrable Securities giving rise to such contribution obligation.

7. Miscellaneous.

(a) Amendments and Waivers. Any term of this Agreement may be amended and the observance of any term of this Agreement may be waived (either generally or in a particular instance and either retroactively or prospectively), only with the written consent of the Company and the Required Investors.

(b) Notices. All notices and other communications provided for or permitted hereunder shall be made as set forth in Section 9.4 of the Purchase Agreement.

(c) Assignments and Transfers by Investors. The provisions of this Agreement shall be binding upon and inure to the benefit of the Investors and their respective successors and assigns. An Investor may transfer or assign, in whole or from time to time in part, to one or more persons its rights hereunder in connection with the transfer of Registrable Securities by such Investor to such person, provided that such Investor complies with all laws applicable thereto and provides written notice of assignment to the Company promptly after such assignment is effected.

(d) Assignments and Transfers by the Company. This Agreement may not be assigned by the Company (whether by operation of law or otherwise) without the prior written consent of the Required Investors; provided, however, that in the event that the Company is a party to a merger, consolidation, share exchange or similar business combination transaction in which the Common Stock is converted into the equity securities of another Person, from and after the effective time of such transaction, such Person shall, by virtue of such transaction, be deemed to have assumed the obligations of the Company hereunder, the term “Company” shall be deemed to refer to such Person and the term “Registrable Securities” shall be deemed to include the securities received by the Investors in connection with such transaction unless such securities are otherwise freely tradable by the Investors after giving effect to such transaction.

(e) Benefits of the Agreement. The terms and conditions of this Agreement shall inure to the benefit of and be binding upon the respective successors and permitted assigns of the parties. Nothing in this Agreement, express or implied, is intended to confer upon any party other than the parties hereto or their respective successors and permitted assigns any rights, remedies, obligations, or liabilities under or by reason of this Agreement, except as expressly provided in this Agreement.

(f) Counterparts; Faxes. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. This Agreement may be delivered via facsimile or other form of electronic communication, which shall be deemed an original.

(g) Titles and Subtitles. The titles and subtitles used in this Agreement are used for convenience only and are not to be considered in construing or interpreting this Agreement.

(h) Severability. Any provision of this Agreement that is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof but shall be interpreted as if it were written so as to be enforceable to the maximum extent permitted by applicable law, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction. To the extent permitted by applicable law, the parties hereby waive any provision of law which renders any provisions hereof prohibited or unenforceable in any respect.

(i) Further Assurances. The parties shall execute and deliver all such further instruments and documents and take all such other actions as may reasonably be required to carry out the transactions contemplated hereby and to evidence the fulfillment of the agreements herein contained.

(j) Entire Agreement. This Agreement is intended by the parties as a final expression of their agreement and intended to be a complete and exclusive statement of the agreement and understanding of the parties hereto in respect of the subject matter contained herein. This Agreement supersedes all prior agreements and understandings between the parties with respect to such subject matter.

(k) Governing Law; Consent to Jurisdiction; Waiver of Jury Trial. This Agreement shall be governed by, and construed in accordance with, the internal laws of the State of New York without regard to the choice of law principles thereof. Each of the parties hereto irrevocably submits to the exclusive jurisdiction of the courts of the State of New York located in New York County and the United States District Court for the Southern District of New York for the purpose of any suit, action, proceeding or judgment relating to or arising out of this Agreement and the transactions contemplated hereby. Service of process in connection with any such suit, action or proceeding may be served on each party hereto anywhere in the world by the same methods as are specified for the giving of notices under this Agreement. Each of the parties hereto irrevocably consents to the jurisdiction of any such court in any such suit, action or proceeding and to the laying of venue in such court. Each party hereto irrevocably waives any objection to the laying of venue of any such suit, action or proceeding brought in such courts and irrevocably waives any claim that any such suit, action or proceeding brought in any such court has been brought in an inconvenient forum. EACH OF THE PARTIES HERETO WAIVES ANY RIGHT TO REQUEST A TRIAL BY JURY IN ANY LITIGATION WITH RESPECT TO OR ARISING OUT OF THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY AND REPRESENTS THAT COUNSEL HAS BEEN CONSULTED SPECIFICALLY AS TO THIS WAIVER.

IN WITNESS WHEREOF, the parties have executed this Agreement or caused their duly authorized officers to execute this Agreement as of the date first above written.

The Company: SHARPSPRING, INC.

By: /s/ Brad Stanczak

Name: Brad Stanczak

Title: Chief Financial Officer

The Investors: SPECIAL SITUATIONS PRIVATE EQUITY FUND, L.P.

SPECIAL SITUATIONS TECHNOLOGY FUND, L.P.

SPECIAL SITUATIONS TECHNOLOGY FUND II, L.P.

By: /s/ Adam Stettner

Name: Adam Stettner

Title: General Partner

GREENHAVEN ROAD CAPITAL FUND 1, LP

GREENHAVEN ROAD CAPITAL FUND 2, LP

By: Greenhaven Road Investment Management, LP

As Investment Manager

By: /s/ Scott Stewart Miller, Jr.

Name: Scott Stewart Miller, Jr.

Title: Authorized Signatory

Exhibit A

Plan of Distribution

The selling stockholders, which as used herein includes donees, pledgees, transferees or other successors-in-interest selling shares of common stock or interests in shares of common stock received after the date of this prospectus from a selling stockholder as a gift, pledge, partnership distribution or other transfer, may, from time to time, sell, transfer or otherwise dispose of any or all of their shares of common stock or interests in shares of common stock on any stock exchange, market or trading facility on which the shares are traded or in private transactions. These dispositions may be at fixed prices, at prevailing market prices at the time of sale, at prices related to the prevailing market price, at varying prices determined at the time of sale, or at negotiated prices.

The selling stockholders may use any one or more of the following methods when disposing of shares or interests therein:

ordinary brokerage transactions and transactions in which the broker-dealer solicits purchasers;

block trades in which the broker-dealer will attempt to sell the shares as agent, but may position and resell a portion of the block as principal to facilitate the transaction;

purchases by a broker-dealer as principal and resale by the broker-dealer for its account;

an exchange distribution in accordance with the rules of the applicable exchange;

privately negotiated transactions;

short sales effected after the date the registration statement of which this Prospectus is a part is declared effective by the SEC;

through the writing or settlement of options or other hedging transactions, whether through an options exchange or otherwise;

broker-dealers may agree with the selling stockholders to sell a specified number of such shares at a stipulated price per share;

a combination of any such methods of sale; and

any other method permitted by applicable law.

The selling stockholders may, from time to time, pledge or grant a security interest in some or all of the shares of common stock owned by them and, if they default in the performance of their secured obligations, the pledgees or secured parties may offer and sell the shares of common stock, from time to time, under this prospectus, or under an amendment to this prospectus under Rule 424(b)(3) or other applicable provision of the Securities Act amending the list of selling stockholders to include the pledgee, transferee or other successors in interest as selling stockholders under this prospectus. The selling stockholders also may transfer the shares of common stock in other circumstances, in which case the transferees, pledgees or other successors in interest will be the selling beneficial owners for purposes of this prospectus.

In connection with the sale of our common stock or interests therein, the selling stockholders may enter into hedging transactions with broker-dealers or other financial institutions, which may in turn engage in short sales of the common stock in the course of hedging the positions they assume. The selling stockholders may also sell shares of our common stock short and deliver these securities to close out their short positions, or loan or pledge the common stock to broker-dealers that in turn may sell these securities. The selling stockholders may also enter into option or other transactions with broker-dealers or other financial institutions or the creation of one or more derivative securities which require the delivery to such broker-dealer or other financial institution of shares offered by this prospectus, which shares such broker-dealer or other financial institution may resell pursuant to this prospectus (as supplemented or amended to reflect such transaction).

The aggregate proceeds to the selling stockholders from the sale of the common stock offered by them will be the purchase price of the common stock less discounts or commissions, if any. Each of the selling stockholders reserves the right to accept and, together with their agents from time to time, to reject, in whole or in part, any proposed purchase of common stock to be made directly or through agents. We will not receive any of the proceeds from this offering.

The selling stockholders also may resell all or a portion of the shares in open market transactions in reliance upon Rule 144 under the Securities Act of 1933, provided that they meet the criteria and conform to the requirements of that rule.

The selling stockholders and any underwriters, broker-dealers or agents that participate in the sale of the common stock or interests therein may be "underwriters" within the meaning of Section 2(11) of the Securities Act. Any discounts, commissions, concessions or profit they earn on any resale of the shares may be underwriting discounts and commissions under the Securities Act. Selling stockholders who are "underwriters" within the meaning of Section 2(11) of the Securities Act will be subject to the prospectus delivery requirements of the Securities Act.

To the extent required, the shares of our common stock to be sold, the names of the selling stockholders, the respective purchase prices and public offering prices, the names of any agents, dealer or underwriter, any applicable commissions or discounts with respect to a particular offer will be set forth in an accompanying prospectus supplement or, if appropriate, a post-effective amendment to the registration statement that includes this prospectus.

In order to comply with the securities laws of some states, if applicable, the common stock may be sold in these jurisdictions only through registered or licensed brokers or dealers. In addition, in some states the common stock may not be sold unless it has been registered or qualified for sale or an exemption from registration or qualification requirements is available and is complied with.

We have advised the selling stockholders that the anti-manipulation rules of Regulation M under the Exchange Act may apply to sales of shares in the market and to the activities of the selling stockholders and their affiliates. In addition, to the extent applicable we will make copies of this prospectus (as it may be supplemented or amended from time to time) available to the selling stockholders for the purpose of satisfying the prospectus delivery requirements of the Securities Act. The selling stockholders may indemnify any broker-dealer that participates in transactions involving the sale of the shares against certain liabilities, including liabilities arising under the Securities Act.

We have agreed to indemnify the selling stockholders against liabilities, including liabilities under the Securities Act and state securities laws, relating to the registration of the shares offered by this prospectus.

We have agreed with the selling stockholders to keep the registration statement of which this prospectus constitutes a part effective until the earlier of (i) the date that such securities become eligible for resale without volume or manner-of-sale restrictions and without current public information pursuant to Rule 144 and certain other conditions have been satisfied, or (ii) all of the securities have been sold or otherwise disposed of pursuant to the registration statement of which this prospectus forms a part or in a transaction in which the transferee receives freely tradable shares.

Exhibit 10.3

EMPLOYEE AGREEMENT

This Agreement (the “Agreement”) is made and entered into as of December 2, 2019 by SharpSpring Technologies, Inc., a Delaware corporation (the “Company”), including its parents, affiliates, assignees, and successors, each of whom are expressly authorized to enforce this Agreement, and who are referenced herein as “the Company” and Michael Power, referenced herein as “you” or “your” or “Employee”.

CONSIDERATION. You agree that this Agreement is entered into in consideration of the mutual promises contained in this Agreement and other good and valuable consideration, and in further consideration of your present employment or association with the Company or your continued employment or association with the Company. Your employment or association with the Company is at-will and may be terminated at any time at the election of either party. This Agreement does not guarantee your employment by or association with the Company for any definite period of time.

REPRESENTATIONS AND WARRANTIES. You represent and warrant to the Company that the following statements are true and correct and shall remain true and correct at all times during your employment or association with the Company:

All statements and representations contained in your application for employment or association are true and correct; and

This Agreement constitutes a legal, valid, and binding agreement and obligation enforceable against you in accordance with its terms.

POSITION AND DUTIES. The Company agrees to employ you to act as its Chief Financial Officer effective as of December 2, 2019. You shall be responsible for leading the Company’s finance and accounting functions, including financial reporting and analysis, and other duties as may be prescribed by the Company’s Chief Executive Officer from time to time. You agree that you will serve the Company faithfully and to the best of your ability during the term of employment, under the direction of the Chief Executive Officer of the Company.

PLACE OF EMPLOYMENT. You shall perform your duties under this Employee Agreement at 5001 Celebration Pointe Ave, Gainesville, FL, or the Company’s then-current headquarters office.

COMPENSATION OF EMPLOYEE. For all services rendered, you shall initially receive compensation as follows:

Base Salary: The Company agrees to pay you at a rate of $250,000 per year, which may be increased from time to time by the Board’s Compensation Committee, except pursuant to across-the-board salary reductions affecting all other senior executives of the Employer, may not be decreased. The Base Salary will be payable on a semi-monthly basis, or on whatever basis SharpSpring may adopt in the future, in accordance with the Company’s standard payroll practices

Bonus: You will be eligible for participation in SharpSpring’s executive bonus plan with a bonus opportunity of $70,000. The payout related to your bonus opportunity will initially be based on the Company achieving specified revenue and EBITDA performance targets as set by the Board of Directors, and may be modified from time to time by the Board of Directors in their sole discretion. The executive bonus is currently paid quarterly, but may be paid annually in the future at the election of the board.

Reimbursement of Moving Cost: In addition to your ongoing compensation, after commencing your employment and relocating to the Gainesville, FL area, SharpSpring will reimburse you for up to a cumulative total of $50,000 of direct moving costs and up to six (6) months of temporary housing costs, in association with your relocation to the Gainesville, FL area. Reimbursed moving costs shall be refunded to the Company on a pro-rata basis if you choose to leave the Company during your first year of employment, other than if you choose to leave for Good Reason. Such moving costs shall not include real-estate brokerage fees. Any reimbursements shall follow our standard expense reimbursement process, which requires valid receipts for any expenses incurred and approval of expenses by a supervisor. Reimbursements are subject to all tax withholdings and deductions, as required by law. Any required withholdings and deductions are your responsibility, and not reimbursable by the Company. For purposes hereof, “Good Reason” shall be defined per Section 8, b. below.

Equity: Subject to approval by the Company’s Board of Directors, you will be granted Restricted Stock Units (“RSUs”), with the total quantity determined by the fair value of 100,000 stock options as of your commencement date with expected RSU count of approximately 50,000. (Fair value is determined using the Black-Scholes model, which adheres to ASC 718. The RSUs will be subject to the terms and conditions of the Company’s 2019 Equity Incentive Plan, as may be amended, and the Restricted Stock Unit Agreement that you will sign in connection with receiving the RSUs. The RSUs shall vest over four (4) years, with 25% of the RSUs vesting on the one-year anniversary of the date of the grant and the remaining 75% of the RSUs vesting on a monthly basis thereafter. You will be considered for future stock and or option grants to the extent that the Board of Directors considers those for other Company executives.

Withholdings: All amounts due from the Company to the Employee hereunder shall be paid to the Employee net of all taxes and other amounts which the Company is required to withhold by law.

REIMBURSEMENT FOR BUSINESS EXPENSES. Subject to the approval of the Company, the Company shall promptly pay or reimburse You for all reasonable business expenses incurred in performing Your duties and obligations under this Employee Agreement, but only if You properly account for expenses in accordance with the Company’s policies.

PAID TIME OFF AND BENEFITS. You shall be entitled to the same benefits, paid time off and Company holidays offered by the Company to its senior management. Nothing in this Employee Agreement shall prohibit the Company from modifying or terminating any of its employee benefit plans in a manner that does not discriminate between Employee and other Company senior management.

TERMINATION OF EMPLOYMENT. Employee’s employment hereunder shall automatically terminate upon (i) his death; (ii) Employee voluntarily leaving the employ of the Company; (iii) at the Company’s sole discretion, for any reason, with or without cause.

PAYMENT ON TERMINATION. In the event that Employee’s employment under this agreement is terminated for any reason, Company shall promptly pay Employee any amounts due to Employee under this agreement, including any salary accrued through the date of termination, and reimbursement for business related expenses during the period of Employee’s employment, providing that such expenses are submitted in accordance with Company policies. In the event that you leave the Company’s employment for Good Reason or if the Company terminates your employment without Cause, you shall be entitled to receive severance in an amount equal to one day of base salary for every completed work day of employment with the Company, up to a maximum of six (6) months of base salary and the Company will pay for or reimburse all of your premiums for continuing your health care coverage and the coverage of your dependents who are covered at the time of your termination or resignation, under the applicable provisions of the Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA) for the 12 month severance period. Such severance shall be paid semi-monthly according to the Company’s normal payroll process, and shall terminate immediately if you become gainfully employed during the severance period.

FOR PURPOSES HEREOF, “GOOD REASON”. means (i) a reduction in your Annual Base Salary of more than five (5) percent, other than pursuant to an across-the-board reduction in accordance with Section 5, (ii) a material diminution in your duties or responsibilities inconsistent with your position, (iii) a change in your principal office to a location more than fifty (50) miles from Gainesville, Florida, provided such location is also more than fifty (50) miles from your principal residence as of the date of relocation, or (iv) the failure of Employer to obtain the assumption (by operation of law, the continuation of the corporate existence of the Company, SharpSpring or otherwise) of this Agreement or substitution of a substantially similar agreement by any successors in a Change of Control, in each case without your prior written consent; provided that you must deliver written notice of your resignation to the Company within 30 days of your actual knowledge of any such event, the Company must be provided at least 30 days during which it may remedy the condition and you must terminate your employment within six (6) months of the initial occurrence of Good Reason in order for such resignation to be with Good Reason for any purpose hereunder.

FOR PURPOSES HEREOF, “CAUSE” means (i) the conviction or plea of guilty or no contest for or indictment on a felony or a crime involving moral turpitude or the commission of any other act or omission involving misappropriation, embezzlement or fraud, which involves a material matter with respect to the Company or any Subsidiary or any of their customers or suppliers; (ii) substantial and repeated failure to perform duties of the office you hold as reasonably directed by the CEO or Board after notice from the CEO or Board and a reasonable opportunity to respond to such notice; (iii) gross negligence or willful misconduct with respect to the Company or any Subsidiary that is or could reasonably be expected to be harmful to the Company or any Subsidiary in any material respect after notice from the CEO or Board and a reasonable opportunity to respond to such notice.

FOR THE PURPOSE HEREOF, “CHANGE IN CONTROL”. to the extent you have not already vested in any Long-term Incentive Awards due to the Change in Control, (A) in the case of unvested awards subject to time-based vesting, you will immediately vest in, options shall become exercisable, or cash or shares will be settled or distributed, representing 100% of any Unvested Awards (B) in the case of Unvested Awards subject to performance-based vesting, you will vest in, and options shall become exercisable, or cash or shares will be settled or distributed, as provided in the applicable Long-term Incentive Award agreement (“Change in Control Vesting”). With respect to (A) and (B) above, if acquirer notifies you in writing that your services in the same role, title, and total compensation is required for up to six months following announced change in control then vesting will still occur but with a lockup period no longer than six months from date of notice by acquirer. For purposes of this Agreement, a “Change of Control” shall mean the occurrence of any of the following events: (i) an acquisition of the Company by another entity by means of any transaction or series of related transactions (including, without limitation, any reorganization, merger or consolidation but excluding any merger effected exclusively for the purpose of changing the domicile of the Company), or (ii) a sale of all or substantially all of the assets of the Company (collectively, a Merger), so long as in either case the Company’s stockholders of record immediately prior to such Merger will, immediately after such Merger, hold less than fifty percent (50%) of the voting power of the surviving or acquiring entity.

BEST EFFORTS AND OUTSIDE ACTIVITIES. You shall devote all of the necessary business time, attention, and energies, as well as your best talents and abilities to the business of the Company in accordance with the Company’s instructions and directions. You may engage to a limited extent in other business activities unrelated to the Company so long as such activities do not create a conflict of interest or otherwise interfere with the performance of your duties and the terms and conditions of this Employee Agreement.

10.

MAINTENANCE OF LIABILITY INSURANCE. So long as You shall serve as an executive officer of the Company pursuant to this Employee Agreement, the Company shall obtain and maintain in full force and effect a policy of director and officer liability insurance of at least $5,000,000 from an established and reputable insurer. In all policies of such insurance, Employee shall be named as an insured in such manner as to provide Employee the same rights and benefits as are accorded to the most favorably insured of the Company’s officers or directors.

11.

INDEMNIFICATION. In addition to the insurance coverage described above and the indemnification protection set forth in Article IX of the Company’s Bylaws, the Company shall indemnify Employee to the fullest extent permitted by applicable law if he is made, or threatened to be made, a party to an action or proceeding, whether civil, criminal, administrative or investigative (each a “Proceeding”), by reason of the fact that Employee is or was an officer, director, or employee of the Company or any of its affiliates, against all “Expenses” (as defined below) resulting from or related to such Proceeding, or any appeal thereof. Any such indemnification pursuant to this section shall continue as to Employee even if Employee has ceased to be an executive, officer, director or employee of the Company and/or any of its affiliates, and shall inure to the benefit of Employee’s heirs, executors and administrators. Expenses incurred by Employee in connection with any indemnification-eligible Proceeding shall be paid by the Company in advance upon request of Employee that the Company pay such Expenses, (a) after receipt by the Company of a written request from Employee for such advance, together with documentation reasonably acceptable to the Board, and (b) subject to an undertaking by Employee to pay back any advanced amounts for which it is later determined that Employee was not entitled to indemnification as described herein. Employee shall be entitled to select his own counsel in connection with any indemnification-eligible Proceeding. Notwithstanding the foregoing provisions of this section to the contrary, the Company shall have no obligation to indemnify Employee or advance Expenses to Employee (i) in connection with any claim or proceeding between Employee and the Company (unless approved by the Board), or (ii) if Employee’s actions or omissions giving rise to his status as a party to a Proceeding involve intentional or willful misconduct or malfeasance on the part of Employee in connection with the performance of his job. For purposes of this section, the term “Expenses” means any damages, losses, judgments, liabilities, fines, penalties, excise taxes, settlements, costs, reasonable attorneys’ fees, accountants’ fees, expert fees, and disbursements and costs of attorneys, experts and accountants.

12.

RECORDS OWNERSHIP. You acknowledge, understand, and agree that all files, records and documents, whether in hard copy, electronic or any other form, generated or received by the Company or its employees, or concerning the Company or its business, belong to and constitute the property of Company and that Company is the records owner of all such files, records and documents. Therefore, upon your separation from employment, all such files, records and documents shall remain on the premises and in the possession of Company, and you shall promptly return any and all such files, records and documents to Company that you may then have, or at any time thereafter you discover in your possession. You shall not retain any copies of such files, records and documents.

13.

INTANGIBLE PROPERTY OWNERSHIP. You hereby irrevocably assign and transfer, and agree to assign and transfer, to the Company all of your rights, title and interest in and to any and all inventions and works you create or modify (including, but not limited to software or other works, designs, or the like) for or on behalf of the Company. You hereby acknowledge and agree that such works are within the scope of your employment or association, and that all intellectual property rights, including copyright, inventions, designs, and trade secrets, whether patentable or not, are the exclusive and sole worldwide property of the Company. Copyrighted works developed or created by you and owned by the Company include the right to copy, license, market, manufacture, publish, distribute, create derivative works from the works created, mark as copyrighted by the Company, and to authorize others to do some or all of the foregoing as needed or desired by the Company to carry out its business purpose.

You will not at any time during or after your employment or association with the Company have or claim any right, title or interest in any trade name, trademark, patent, copyright, work for hire, or other similar rights belonging to or used by the Company. You shall not have or claim any right, title or interest in any material or matter of any sort prepared for or used in connection with the business or promotion of the Company, whatever your involvement with such matters may have been, and whether procured, produced, prepared or published in whole or in part by you. You further release and hereby assign all rights in any and all intellectual property to the Company, and shall, at the request of the Company, give evidence and testimony and execute any and all agreements or other documents as needed to effect or memorialize any such transfer of rights without encumbrance, and for the Company to carry out its business purpose. You hereby irrevocably appoint the Company as your attorney-in-fact (with a power couple with an interest) to execute any and all documents which may be necessary or appropriate in the security of such rights, including but not limited to, any copyright in your work.

You certify that all works pursuant to this Agreement are original works and are not the property of others, and that any liability from or caused by you in this regard is your sole responsibility. You shall hold harmless and indemnify the Company from and against any and all claims, actions, losses, costs, or other liabilities based on or arising out of claimed infringement by the works of any copyright or other intellectual property rights of any third party, and you agree to cooperate in the defense of the Company against any and all claims, actions, losses, costs, or other liabilities based on or arising out of claimed infringement or any other action by the works of any copyright or other intellectual property rights of any third party at your expense.

You have attached hereto, as Exhibit A, a list detailing all inventions, original works of authorship, developments, improvements, and trade secrets which you made prior to the commencement of this Agreement (collectively referred to as “Prior Inventions”), which belong solely to you or belong to you jointly with another, and which are not assigned to the Company hereunder or, if no such list is attach, you represent that there no such Prior Inventions.

14.

TRADE SECRETS AND CONFIDENTIAL INFORMATION. You agree to keep confidential and not disclose to others any Trade Secrets or Confidential and Proprietary Information, during the term of this Agreement and all times thereafter, except as required by law or as consented in writing by the Company’s President.

You agree that the Trade Secrets and Confidential and Proprietary Information described herein are valuable information.

Trade Secrets and Confidential and Proprietary Information includes all forms of information whether in oral, written, graphic, magnetic or electronic form without limitation. Trade Secrets and Confidential and Proprietary Information means, without limitation, the Company’s client and prospective client names, addresses, relationships, terms and information; suppliers’ names, addresses, terms and information; financial information; business and/or marketing plans; methods of operation; internal structure; financial information and practices; products and services; inventions; systems; devices; methods; ideas, procedures; client lists and files; fee schedules; test data; descriptions; drawings; techniques; algorithms; programs; designs; formula; software; business management and methods; planning methods; sales and marketing methods; valuable confidential business and professional information; proprietary computer software; management information; and all know-how, trade secrets, confidential information and any other information developed by and belonging to the Company which gives the Company a competitive advantage over others.

If you shall leave, separate or terminate from the Company, you will neither take nor retain any file, record, document, Trade Secrets or Confidential and Proprietary Information, whether a reproduction, duplication, copy or original, of any kind or nature developed by, compiled by or belonging to the Company.

15.

NO PRIOR COVENANT NOT TO COMPETE. You warrant and represent that except for this Agreement and except as otherwise disclosed in writing to the Company, (a) you are not presently subject to any contract or understanding that restricts in any manner your ability to provide services to the Company; (b) you have performed all duties and obligations that you may have under any contract or agreement with a former employer (or other party) including but not limited to the return of all confidential information; and (c) you are currently not in possession of any confidential materials or property belonging to any former employer (or other party). Further, you agree to defend, indemnify, and hold the Company harmless from and against any demands, claims, obligations, causes of action, diminution in the value of the Company, damages, liabilities, costs, expenses, interest, and fees, which the Company may incur due to (a) any conflict between your employment with Company and any prior employment or association, duty contract, agreement, order or restrictive covenant, or (b) any misrepresentation by you as to any facts which are the subject matter of any conflict or violation of any prior contract, agreement, order or restrictive covenant on your part.

16.

COVENANT NOT TO COMPETE. You acknowledge that you are familiar with restrictive covenants of this nature, the covenant is a material inducement to this Agreement and your employment, the Company will suffer irreparable injury if you violate this restrictive covenant, and the covenant is fair and reasonable to protect the Company’s trade secrets, confidential and proprietary information, relationships with prospective and existing clients, goodwill, and/or other legitimate business interests. You further agree that your work with the Company has provided and will provide you extraordinary and specialized training, knowledge and information over the Company’s techniques, methods, products and systems; the Company’s valuable confidential proprietary and business information which you would not otherwise acquire; and access to its substantial relationships with present and prospective clients and substantial goodwill associated with its name.

The covenant is intended to protect the Company’s legitimate business interests which include but are not limited to the extraordinary and specialized training of its employees; valuable confidential and proprietary business and professional information; substantial relationships with prospective and existing clients; client good will associated with the Company’s ongoing professional and business practice and trade name in the fields of business and financial software and related professional activities throughout North America and globally.

Accordingly, you agree that prior to your separation or termination from the Company and for the later of one (1) year after your separation or termination (with or without cause) or from the date of entry by a court of competent jurisdiction enforcing these covenants, whichever is later (referenced herein as “the restricted period): You shall not engage, directly or indirectly, as principal, agent, advisor, stockholder, consultant, partner, independent contractor, or employee or in any other manner in any business or activity which is in competition with the Company or which may propose to go into competition with the Company. And, during the restricted period, you shall not directly or indirectly induce or attempt to induce (a) clients of the Company to do business with any competitor of the Company, and/or (b) any of the officers, agents, employees, or associates of the Company to leave the employment or association of the Company.

Some of the businesses which are in competition with the Company or which may propose to go into competition with the Company, and which are specifically prohibited include but are not limited to: HubSpot, Marketo, Salesforce.com, Act-On, Eloqua and Responsys (both part of Oracle), Constant Contact, iContact, MailChimp, Infusionsoft, J2 Global (Campaigner), and Feathr. This list of businesses is not intended to be an exclusive list.

Nothing herein shall prohibit you from purchasing or owning less than five percent (5%) of the publicly traded securities of any corporation, provided that such ownership represents a passive investment and that you are not a controlling person of, or a member of a group that controls, such corporation.

17.

REMEDIES FOR BREACH OF RESTRICTIVE COVENANTS. The Company is entitled to obtain equitable relief, including specific performance by means of injunctions, as well as monetary damages and any other available remedies. In the event a court of competent jurisdiction determines these restrictive covenants are not enforceable as written herein, the court will reform or modify the restrictive covenants(s) to make it (them) reasonable and enforceable, and the court will enforce the restrictive covenants(s) as so reformed or modified. Assignees and successors of the Company are expressly authorized to enforce these restrictive covenants. The restrictive covenants of this Agreement shall not be interpreted to employ any rule of contract construction that requires construing a restrictive covenant narrowly, against the restraint, or against the drafter of this Agreement.

Further, you understand that any and all obligations of the Company to pay any compensation to you for any reason shall cease and terminate upon your breach of any of the obligations in this Employee Agreement.

18.

NOTIFICATION OF INTERESTED PARTIES. You agree that the Company may notify anyone employing or engaging you to perform services or evidencing an intention to employ you now or in the future as to the existence and provisions of this Agreement. You shall, during the restricted period, (1) inform anyone employing or engaging you or evidencing an intent to employ or engage you, of the existence of the restrictive covenants in this Agreement and (2) notify the Company of the name, address, and telephone number of anyone who employs or engages you to perform services.

19.

MEDIATION. If a dispute arises out of or related to the interpretation or enforcement of this Agreement, you agree to try to settle the dispute in good faith through mediation upon the Company’s request, before litigation or at any time during litigation.

20.

WAIVERS. The Company’s waiver of a breach of any provision of this Agreement shall not operate or be construed as a waiver of any subsequent breach.

21.

GOVERNING LAW, JURISDICTION AND VENUE. The Agreement shall be governed by the laws of the State of Florida and applicable federal and local law, and jurisdiction and venue for enforcement shall be in state circuit court in Gainesville, Florida.

22.

INDEPENDENT RESTRICTIVE COVENANTS AND SEVERABILITY. The provisions of this Agreement are independent of and separate from each other and from any other agreements. The breach, invalidity or unenforceability of any provision or part of any provision in this Agreement or any other agreements shall not in any way effect the validity or enforceability of any other provision or part of provision of this Agreement. The existence of any claim or cause of action by you against the Company shall not constitute a defense to the enforcement of these provisions.

23.

ENTIRE AGREEMENT. This Agreement comprises the entire agreement and understanding by the parties regarding the topics contained herein; no representations, promises, agreements, or understandings, written or oral, relating hereto but not contained herein, shall be of any force or effect. This Agreement may be amended only in writing and by mutual agreement of the parties.

24.

ATTORNEYS’ FEES AND COSTS. If any litigation proceedings are bought arising out of or related to the terms of this Agreement, the successful prevailing party will be entitled to reimbursement for all reasonable costs, including reasonable attorneys’ fees.

25.

ACKNOWLEDGEMENT. Employee acknowledges that he has had the benefit of independent professional counsel with respect to this Agreement and that the Employee is not relying upon the Company, the Company’s attorneys or any person on behalf of or retained by the Company for any advice or counsel with respect to this Agreement.

26.

NUMBER OF PAGES. This Agreement, including the signatures and excluding Exhibits, is comprised of ten (10) pages.

/s/ Michael Power	11/20/2019
Employee: Michael Power	Date

/s/ Rick Carlson	11/21/2019
Rick Carlson, CEO and President	Date

for SharpSpring Technologies, Inc.

Exhibit A

NONE

Exhibit 99.1

ASSET PURCHASE AGREEMENT

BY AND AMONG

MARIN SOFTWARE INCORPORATED

and

SHARPSPRING, INC.

November 21, 2019

TABLE OF CONTENTS

Article I PURCHASE AND SALE TRANSACTIONS		1
1.01	Purchase of Assets and Assumption of Liabilities	1
1.02	The Purchase Price	5
1.03	The Closing	5
1.04	Withholding	6
Article II REPRESENTATIONS AND WARRANTIES OF SELLER		6
2.01	Organization and Corporate Power	6
2.02	Due Execution and Delivery; Valid and Binding Agreement	7
2.03	Required Filings and Consents	7
2.04	Financial Information	7
2.05	Accounts Receivable	7
2.06	Solvency	7
2.07	Non-Contravention	8
2.08	Title to Properties	8
2.09	Absence of Changes	8
2.10	Litigation	9
2.11	Compliance with Laws.	9
2.12	Material Contracts	10
2.13	Employees; Employee Benefit Plans	12
2.14	Intellectual Property.	13
2.15	GDPR; Personal Data Protection.	16
2.16	IT Systems.	17
2.17	Sufficiency of Assets	17
2.18	Transactions with Affiliates	18
2.19	Brokers’ Fees	18
2.20	Customers	18
2.21	Vendors	18
2.22	Disclosure	18
Article III REPRESENTATIONS AND WARRANTIES OF BUYER		19
3.01	Organization and Corporate Power	19
3.02	Due Execution and Delivery; Valid and Binding Agreement	19
3.03	Required Filings and Consents	19
3.04	Non-Contravention	19
3.05	Litigation	20
3.06	Sufficient Funds	20
3.07	Knowledge of Misrepresentations	20
3.08	Brokers’ Fees	20

Article IV OTHER COVENANTS AND AGREEMENTS		20
4.01	Access	20
4.02	Tax Matters	20
4.03	Employee Matters	21
4.04	Public Announcements	24
4.05	Buyer Financial Statements and Audit.	24
4.06	Proprietary Information.	25
4.07	Fees and Expenses	25
4.08	Transfer Taxes	25
4.09	Termination of Overhead and Shared Services	26
4.10	Use of Names	26
4.11	Restrictive Covenants	26
4.12	Non-Transferable Sub-Domain	27
4.13	Transition SRE Services	29
4.14	Further Assurances; Post-Closing Payments	29
4.15	No Additional Representations; Disclaimer	30
Article V INDEMNIFICATION		30
5.01	No Survival	30
5.02	Indemnification by Seller	30
5.03	Indemnification by Buyer	31
5.04	Limits on Indemnification; Determination of Losses	31
5.05	Indemnification Procedures	31
5.06	Exclusive Remedy	33
5.07	Indemnification Payments	33
Article VI Miscellaneous		33
6.01	Amendment and Waiver	33
6.02	Notices	33
6.03	Assignment; No Third-Party Beneficiaries	34
6.04	Severability	34
6.05	No Strict Construction	34
6.06	Captions	35
6.07	Complete Agreement	35
6.08	Disclosure Letter	35
6.09	Counterparts	35
6.10	Specific Performance	35
6.11	Governing Law; Jurisdiction; Waiver of Jury Trial	35
6.12	Interpretation	36

Exhibits

Exhibit A – Assignment and Assumption Agreement

Exhibit B - Retained IP License Agreement

Exhibit C – Employee Sharing Agreement

Annexes

Annex A – Defined Terms

ASSET PURCHASE AGREEMENT

This ASSET PURCHASE AGREEMENT (this “Agreement”) is made as of November 21, 2019 by and among SharpSpring, Inc., a Delaware corporation (“Buyer”) and Marin Software Incorporated, a Delaware corporation (“Seller”). Capitalized terms used and not otherwise defined herein shall have the meanings set forth in Annex A attached hereto.

WHEREAS, Seller operates the assets and properties used in the Business.

WHEREAS, Seller desires to sell to Buyer, and Buyer desires to purchase substantially all of the assets primarily relating to the Business and to assume substantially all of the liabilities primarily relating to the Business, in each case as set forth more specifically herein.

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

ARTICLE I

PURCHASE AND SALE TRANSACTIONS

1.01 Purchase of Assets and Assumption of Liabilities

(a) At the Closing, on the terms and subject to the conditions set forth herein, Buyer shall purchase and assume from Seller, and Seller shall sell, convey, assign, transfer, and deliver to Buyer, all of the Purchased Assets, free and clear of all Liens other than Permitted Liens. “Purchased Assets” shall mean the following assets, properties and rights of Seller (but, for the avoidance of doubt, excluding the Excluded Assets):

(i) all of Seller’s right, title, and interest in the Intellectual Property set forth below, including all applications and registrations related thereto and including all royalties, income, damages, or other payments receivable in connection therewith (the “Business Intellectual Property”), including:

(A) the Internet domain names set forth on Section 1.01(a)(i)(A) of the Disclosure Letter;

(B) the Trademarks set forth on Section 1.01(a)(i)(B) of the Disclosure Letter; and

(ii) all of Seller’s right, title, and interest in the Computer Software set forth on Section 1.01(a)(ii) of the Disclosure Letter (the “Purchased Software”);

(iii) all of Seller’s right, title, and interest in the data set forth on Section 1.01(a)(iii) of the Disclosure Letter (the “Transferred Data”);

(iv) all right and interest of Seller in any Contract set forth in Section 1.01(a)(iv) of the Disclosure Letter to the extent relating to the Business (the “Purchased Contracts”);

(v) all Actions, refunds, credits, prepaid expenses, rights of recovery, rights of setoff, and other similar rights, in each case, to the extent primarily relating to the Business;

(vi) other than the Transferred Data, all books and records (including electronically kept records) pertaining to customers, suppliers, employees, Contracts, and other business relations, and all other ledgers, files, documents, correspondence, and business records (“Books and Records”), in each case, to the extent primarily relating to the Business or the Purchased Assets (“Purchased Books and Records”);

(vii) to the extent transferable to Buyer, all licenses, permits, warranties, consents, orders, registrations, privileges, franchises, certificates, approvals, and other similar items set forth in Section 1.01(a)(vii) of the Disclosure Letter;

(viii) all trade accounts receivable and notes, bonds, and other evidences of Indebtedness owed to Seller to the extent primarily relating to the Business, and rights to receive payments arising out of sales or services rendered by Seller to the extent primarily relating to the Business (collectively, the “Accounts Receivable”) to the extent an invoice for such Accounts Receivable has not been issued by Seller as of the Closing Date; and

(ix) the assets listed on Section 1.01(a)(ix) of the Disclosure Letter.

(b) Notwithstanding anything to the contrary set forth in Section 1.01(a), in no event shall Buyer purchase from Seller, and in no event shall Seller sell, convey, assign, transfer, and deliver to Buyer, any of the other assets of Seller (the “Excluded Assets”), all of which are excluded from the Purchased Assets. Notwithstanding the generality of the foregoing, the Excluded Assets shall include:

(i) all of Seller’s right, title, and interest in all Intellectual Property other than the Business Intellectual Property, including all applications and registrations related thereto and including all royalties, income, damages, or other payments receivable in connection therewith, including the Intellectual Property set forth on Section 1.01(b)(i) of the Disclosure Letter;

(ii) Seller’s Organizational Documents, all qualifications to do business as a foreign entity, all arrangements with registered agents, all minute books, stock records, stock ledgers, transfer books, and blank share or equity ownership certificates, and all other documents relating to the organization, maintenance, and existence of Seller as a corporation;

(iii) insurance policies, the right to receive amounts thereunder (whether in the form of refunds of premiums previously paid, in the form of claims paid, or otherwise), or the right to make claims thereunder;

(iv) rights to receive refunds of Excluded Taxes;

(v) all of Seller’s rights arising under the Transaction Documents or any other Contract, instrument, or document delivered or executed in connection with the transactions contemplated hereby;

(vi) assets or rights arising out of or in connection with any Excluded Liability;

(vii) all Books and Records other than Purchased Books and Records (provided that Seller shall be entitled to retain a copy of all Purchased Books and Records);

(viii) to the extent not transferable to Buyer, licenses, permits, warranties, consents, orders, registrations, privileges, franchises, certificates, approvals, and other similar items;

(ix) cash or cash equivalents, government securities, or investment securities (including any related accounts with banks, brokerages, or other similar Persons);

(x) all Plans and all insurance Contracts, policies and/or administrative service arrangements related thereto;

(xi) all Accounts Receivable for which an invoice has been issued by the Seller as of the Closing Date; and

(xii)

the assets listed on Section 1.01(b)(xi) of the Disclosure Letter.

(c) In addition to purchasing the Purchased Assets from Seller, Buyer shall assume and agree to perform all Liabilities (a) for accrued Publisher Costs to the extent relating exclusively to the Business, (b) associated with prepaid customer advances or deposits to the extent relating exclusively to the Business and (c) arising out of, or relating to, the operation of the Business arising as a result of an event or events that occurred at or after 12:01 am on the Closing Date (collectively, the “Assumed Liabilities”), including:

(i) those Liabilities arising out of or relating to the Purchased Assets, including all Liability arising out of or relating to the Purchased Contracts and the Transferred Data related to the Business as of the Closing arising as a result of an event or events that occurred at or after 12:01 am on the Closing Date;

(ii) all Liabilities for trade accounts payable owed by Seller to any Person to the extent arising out of or relating to the Business, as a result of an event or events that occurred at or after 12:01 am on the Closing Date;

(iii) all Liabilities for Actions or claims, irrespective of the legal theory asserted, to the extent arising from, or relating to, the operation of the Business (including all Liabilities for infringement or alleged infringement of any Intellectual Property right of any Third Party to the extent relating to the conduct of the Business) as a result of an event or events that occurred at or after 12:01 am on the Closing Date;

(iv) all Liabilities for Taxes relating to the Business arising as a result of an event or events that occurred at or after 12:01 am on the Closing Date, other than the Excluded Taxes; and

(v) the Assumed Employee Liabilities.

(d) In no event shall Buyer assume any Liabilities of Seller other than the Assumed Liabilities, and all such other Liabilities shall remain the obligations of Seller from and after the Closing (the “Excluded Liabilities”). Notwithstanding the generality of the foregoing, the Excluded Liabilities shall include:

(i) Liabilities for Indebtedness;

(ii) Liabilities for Excluded Taxes;

(iii) Liabilities for Transaction Expenses;

(iv) the Excluded Employee Liabilities;

(v) all Liabilities for Actions or claims, irrespective of the legal theory asserted, to the extent arising from, or relating to, the operation of the Business (including all Liabilities for infringement or alleged infringement of any Intellectual Property right of any Third Party to the extent relating to the conduct of the Business) as a result of an event or events that occurred prior to 12:01 am on the Closing Date;

(vi) Liabilities to the extent arising out of any of the Excluded Assets; and

(vii) Liabilities arising from any matters described in the Disclosure Letter that qualify the representations and warranties in Section 2.10.

(e) To the extent that the assignment by Seller to Buyer pursuant to the terms hereof of any Purchased Asset is not permitted without the consent of another Person or Persons or would otherwise constitute a breach or other contravention under any Contract or Law to which Seller is a party or by which it is bound, or in any way adversely affects rights of Seller or, upon transfer, Buyer with respect to such Purchased Asset, this Agreement and the Assignment and Assumption Agreement shall not be deemed to constitute an assignment of any such Purchased Asset if such consent is not obtained, and such asset (a “Contingent Asset”) shall only become a Purchased Asset if and when such consent is obtained. Seller shall use its commercially reasonable efforts from the date of this Agreement through the date that is 180 days after the Closing Date to obtain any consents or waivers required to assign to Buyer any Contingent Asset, without any conditions to such transfer (including the making of any payments) or changes or modifications of terms thereunder. Buyer agrees that, provided Seller has used commercially reasonable efforts to obtain any consent that may be required in connection with the transactions contemplated by this Agreement or the Transaction Documents, Seller and its Affiliates shall not have any Liability to Buyer arising out of or relating to the failure to obtain any such consent that may be required in connection with the transactions contemplated by this Agreement or the Transaction Documents or because of any circumstances arising therefrom. If any such consent is not obtained prior to Closing, Seller and Buyer will cooperate in the negotiation of a mutually agreeable arrangement pursuant to which it is intended that Buyer would obtain all of the benefits and assume all of the obligations and Liabilities thereunder to the fullest extent legally possible as determined by Seller in its sole discretion.

1.02 The Purchase Price.

(a) The consideration to be paid by Buyer on the Closing Date for its purchase of the Purchased Assets from Seller shall be (i) the Closing Cash Purchase Price and (ii) Buyer’s assumption of the Assumed Liabilities (the “Purchase Price”).

(b) The “Closing Cash Purchase Price” shall mean an amount equal to (i) $5,000,000, minus (ii) the amount, if any, by which the Closing Accrued Publisher Cost Amount exceeds $300,000, minus (iii) the Closing Pre-Paid Customer Cash Amount, minus (iv) the Accrued and Unpaid Bonus Amount, plus (v) an amount equal to the Unbilled Accounts Receivable, plus (vi) an amount equal to the Prepaid AWS Licenses. At least two Business Days prior to the Closing Date, Seller shall have provided to Buyer a statement (such statement being the “Closing Statement”) specifying its good faith estimates, certified by the Chief Financial Officer of Seller, with reasonable supporting detail, of each of the Closing Accrued Publisher Cost Amount and the Closing Pre-Paid Customer Cash Amount (as well as the amounts of the Unbilled Accounts Receivable and the Prepaid AWS Licenses), and Seller’s good faith calculation of the Closing Cash Purchase Price based thereon. The Buyer shall have the opportunity to review, comment upon and approve the Closing Accrued Publisher Cost Amount and the Closing Pre-Paid Customer Cash Amount prior to the Closing.

(c) The Purchase Price shall be allocated among the Purchased Assets in a manner consistent with Section 1060 of the Code and Treasury Regulations thereunder (and any similar provision of state, local, or non-U.S. law, as appropriate) and the principles set forth in the attached Section 1.02(c) of the Disclosure Letter (the “Allocation Methodology”). Within 60 days following the Closing, Buyer shall prepare such an allocation in such a manner and provide such allocation to Seller in accordance with the Allocation Methodology (the “Allocation Schedule”), and such Allocation Schedule shall be subject to the review and comment of Seller. Buyer shall consider in good faith all reasonable comments of Seller provided within 20 days of receipt of Buyer’s Allocation Schedule and the parties shall work together in good faith to resolve any differences and agree on a final allocation; provided that if no such agreement can be reached with respect to the allocation, such matter shall be submitted by the parties to a mutually acceptable nationally recognized accounting firm to prepare the allocation, which shall be final and binding on each of Buyer and Seller (as finally prepared, the “Final Allocation”). Any fees or expenses by such accounting firm shall be borne equally by Buyer and Seller. The parties shall timely file a Form 8594 with the Internal Revenue Service in connection with the Final Allocation and shall otherwise report the transactions contemplated by this Agreement in a manner consistent with the Final Allocation. In addition, Buyer, on the one hand, and Seller, on the other hand, agree to provide each other with their respective Federal Tax Identification numbers at Closing for purposes of reporting this transaction to the Internal Revenue Service. Neither Buyer nor Seller shall take any position (whether in audits, Tax Returns or otherwise) that is inconsistent with the Final Allocation unless required to do so by applicable Law.

1.03 The Closing. On and subject to the terms and conditions contained herein, the closing of the purchase and sale of the Purchased Assets and the other transactions contemplated by this Agreement (the “Closing”) shall take place remotely via exchange of documents on the date of this Agreement, or such other time and place as the parties hereto may agree. The date on which the Closing occurs is referred to herein as the “Closing Date.” At the Closing:

(a) Buyer shall deliver to Seller, by wire transfer of immediately available funds to the account or accounts specified to Buyer at least two Business Days prior to the Closing Date, cash in an amount equal to the Closing Cash Purchase Price;

(b) Seller shall deliver to Buyer, a certification, in the form and substance required under Section 1.1445-2(b)(2)of the United States Treasury Regulations and reasonably acceptable to Buyer, certifying the non-foreign status of Seller; and

(c) Seller and Buyer, as applicable, shall duly execute and deliver, in each case in form reasonably satisfactory to Buyer, (collectively, with this Agreement, the “Transaction Documents”):

(i) the Assignment and Assumption Agreement, in the form attached hereto as Exhibit A (the “Assignment and Assumption Agreement”);

(ii) such other special warranty deeds, bills of sale, endorsements, consents, assignments and other good and sufficient instruments of conveyance and assignment as the parties shall deem reasonably necessary to vest in Buyer all right, title and interest in, to and under the Purchased Assets and to evidence Buyer’s assumption of the Assumed Liabilities;

(iii) the Retained IP License Agreement in the form attached hereto as Exhibit B (the “Retained IP License Agreement”);

(iv) the Employee Sharing Agreement in the form attached hereto as Exhibit C (the “Employee Sharing Agreement”); and

(v) Seller shall deliver to Buyer a certificate, duly executed by an authorized officer of the Seller, dated as of the Closing Date, certifying copies of resolutions of the board of directors of the Seller approving entry into this Agreement and the transactions contemplated hereunder.

1.04 Withholding

(a) . Buyer will be entitled to deduct and withhold from the Purchase Price any amount that is required to be deducted and withheld under any provision of applicable Law. All withheld amounts will be treated as delivered to Seller hereunder.

ARTICLE II

REPRESENTATIONS AND WARRANTIES OF SELLER

Except as set forth in the disclosure letter delivered to Buyer by Seller concurrently with the execution of this Agreement (the “Disclosure Letter”), Seller represents and warrants to Buyer as follows:

2.01 Organization and Corporate Power. Seller is a corporation validly existing and in good standing under the Laws of the State of Delaware. Seller is qualified to do business as a foreign entity and in good standing under the laws of each jurisdiction in which it is required to be registered to conduct the Business as currently conducted or the ownership or leasing of the Purchased Assets or the employment of the Business Employees requires such qualification or licensing. Seller has all requisite corporate power and authority to carry on the Business as it is currently conducted and to own and use the Purchased Assets. Seller has all requisite corporate or limited liability company power, as applicable, and authority necessary to execute, deliver, and perform its obligations under, this Agreement and the other Transaction Documents (including all right, power and authority to sell, transfer, convey and surrender the Purchased Assets to Buyer as provided by this Agreement).

2.02 Due Execution and Delivery; Valid and Binding Agreement. This Agreement and the other Transaction Documents have been duly authorized, executed and delivered by Seller. The execution and delivery by Seller of this Agreement and the other Transaction Documents and the performance by Seller of this Agreement and the other Transaction Documents (including all right, power and authority to sell, transfer, convey and surrender the Purchased Assets to Buyer as provided by this Agreement) and the consummation by Seller of the transactions contemplated hereby and thereby have been duly and validly authorized by its board of directors, and no other corporate action on Seller’s part is necessary to authorize the foregoing. Assuming the due execution and delivery of this Agreement by the other parties hereto, this Agreement constitutes a valid and binding obligation of Seller, enforceable against it in accordance with its terms, except as limited by the application of bankruptcy, moratorium, and other Laws affecting creditors’ rights generally and as limited by the availability of specific performance and other equitable remedies and the application of equitable principles.

2.03 Required Filings and Consents. No permit, consent, approval, or authorization of, or notice or declaration to or filing with, any Governmental Entity is required in connection with any of the execution, delivery, or performance of this Agreement by Seller, except for (i) such filings and notifications as may be required under applicable antitrust Laws or the rules of any stock exchange or marketplace and (ii) those permits, consents, approvals, authorizations, declarations, and filings the failure of which to be obtained or made would not be material to the Business.

2.04 Financial Information. Seller has delivered to Buyer true and correct copies of (i) an unaudited pro forma statement of revenues and expenses of the Business (as if it were a stand-alone entity) for each of the six most recent fiscal quarters ending on or prior to June 30, 2019, and (ii) an unaudited pro forma schedule of the assets and Liabilities of the Business (as if it were a stand-alone entity) as of the end of each of the six most recent fiscal quarters ending on or prior to June 30, 2019 (such information referred to in clauses (i) and (ii), the “Business Financial Information”). The Business Financial Information has been prepared from and is consistent with the Books and Records, and such Books and Records accurately and completely reflect, in all material respects, the assets (including the Purchased Assets), Liabilities and results of operations of the Business and have been maintained in accordance with sound business practices, including the maintenance of an adequate system of internal controls.

2.05 Accounts Receivable. All Accounts Receivable represent or will represent valid obligations arising from sales actually made or services actually performed by Seller in the ordinary course of business. There is no Action, contest, claim, defense or right of setoff, other than returns in the ordinary course of business of Seller, under any Contract with any account debtor of an Account Receivable relating to the amount or validity of such Account Receivable. Section 2.05 of the Disclosure Letter contains a complete and accurate list of all Accounts Receivable as of a date within three business days prior to the Closing Date which list sets forth the aging of each such Account Receivable as of such date.

2.06 Solvency. Seller is not now insolvent and will not be rendered insolvent by any of the transactions contemplated hereby. As used in this Section 2.06, “insolvent” means that the sum of the Indebtedness and other probable Liabilities of Seller exceeds the present fair saleable value of Seller’s assets.

2.07 Non-Contravention. Except for those matters which would not be material to the Business, neither the execution nor the delivery of this Agreement by Seller, nor the performance of Seller’s obligations hereunder, will:

(a) violate, breach or conflict with any provision of any Law or Order to which Seller is subject or by which Seller is bound, any provision of the Organizational Documents of Seller, or any resolution adopted by the shareholders, board of directors or any committee of the board of directors of Seller; or

(b) conflict with, result in a violation or breach of or imposition of a Lien upon, constitute (with or without due notice or lapse of time or both) a default under, result in the acceleration of obligations or loss of benefits under, create in any Person the right to accelerate, terminate, modify, or cancel, or require any notice, consent or waiver under, any Purchased Contract.

2.08 Title to Properties. Seller is the true and lawful owner of, has good, valid and marketable title to, or in the case of any leased real property or personal property has valid leasehold interests in, all Purchased Assets owned or leased by Seller, as applicable. No other Person owns or has any right, title or interest in or to the Purchased Assets and no other Person is required to be a party to this Agreement or any of the other Transaction Documents in order to carry out the purposes and transactions contemplated by this Agreement and the other Transaction Documents. Upon execution and delivery by Seller to Buyer of the Assignment and Assumption Agreement and other instruments of conveyance and referred to in Section 1.03(c)(ii), Buyer will become the true and lawful owner of, and will receive good, valid and marketable title to, the Purchased Assets, free and clear of all Liens other than the Assumed Liabilities or any Lien arising solely on account of Buyer’s actions or omissions. Each of the Purchased Assets that constitutes tangible assets, if any, is in good and safe repair and operating condition, subject to normal wear and tear. Notwithstanding the foregoing, the representations in this Section 2.08 shall not apply to the Business Intellectual Property, which is addressed solely in Section 2.13(a).

2.09 Absence of Changes. Since January 1, 2019, (a) Seller has conducted the Business in the ordinary course of business consistent with past practices, (b) no change, event, development, effect or circumstance has occurred or arisen that, either individually or in the aggregate, has had, or would reasonably be expected to have in the future, a Material Adverse Effect, and (c) Seller has not done, caused or permitted any of the following:

(a) made any material change in the conduct of the Business, except for changes that are in the ordinary course or not inconsistent in material respects with past practice;

(b) entered into, amended, renewed, extended, terminated or assigned in a material manner or taken any action that would constitute (or omitted to take any action where such omission would constitute) a violation of or default under, or waived or released any material rights under, any of the Purchased Contracts or any contracts related to the Business that would otherwise constitute a Purchased Contract, other than in the ordinary course of business;

(c) taken any action that has materially impaired or would reasonably be expected to materially impair, or omitted to take any commercially reasonable action where such omission has materially impaired or would reasonably be expected to materially impair, the value or utility of the Business or any of the Purchased Assets;

(d) adopted or amended any Plan, except in each case (i) as required under ERISA or other applicable Law or (ii) any adoption or amendment that is generally applicable to all employees of Seller;

(e) entered into any new Material Contract pursuant to Sections 2.12(a)(v), 2.12(a)(vi), or 2.12(a)(vii);

(f) sold, leased, subleased, mortgaged, pledged, licensed, assigned, transferred, conveyed, disposed of or granted to any Person any interest in any Purchased Asset or in any assets that would otherwise constitute a Purchased Asset, or otherwise encumbered or disposed of any of such assets other than in the ordinary course of business;

(g) changed any financial accounting method used by it relating to the Business, unless required by GAAP, applicable Law, or recommended by independent auditors; or

(h) agreed to take any of the foregoing actions or to suffer any of the foregoing omissions.

2.10 Litigation. There are no, and during the last three years there have not been any, Actions pending or, to the Knowledge of Seller, threatened (a) against, relating to or involving the Business, (b) against Seller challenging in any material respect the legal right of Seller to conduct the Business as currently conducted, or (c) that would reasonably be expected to restrain or prohibit, or have a material impact on the Seller’s ability to consummate, or seek other material equitable relief with respect to, the transactions contemplated hereby. There are no judgments, writs, injunctions, arbitration rulings, awards, settlement agreements, orders, or decrees outstanding against Seller or any of its Affiliates or representatives or other Person acting on its or their behalf relating to the Business or the Purchased Assets.

2.11 Compliance with Laws.

(a) Since January 1, 2018, Seller has been in material compliance with every, and is not presently in material violation of any, Law or Order applicable to the Business and has not failed to obtain, or to adhere to the requirements of, any Permit necessary to the ownership of Seller’s assets and properties primarily relating to the operation of the Business in all material respects. Since January 1, 2018, Seller has not, nor has any of its Affiliates, received, nor does Seller or any of its Affiliates have knowledge of the issuance of, any notice from any Governmental Entity, or other Third Party of any such material violation or alleged material violation by any of them of any Laws or Orders applicable to the Business or the ownership thereof. To the Knowledge of Seller, there is no, and there has not been any, investigation applicable to the Business relating to Seller or the Business in progress or contemplated by any Governmental Entity.

(b) Set forth on Section 2.11(b) of the Disclosure Letter is a true, complete and correct list of all material Permits issued in favor of Seller and that are primarily relating to the Business. All of such Permits are in full force and effect, and the Business is currently being operated in compliance, in all material respects, with the terms of each such Permit. Seller has not taken any action, or failed to take any action, that would reasonably be expected to result in or enable, with or without notice or lapse of time or both, the revocation or termination of any of such Permits or the imposition of any restrictions thereon. There are no other Permits that are material to the Business that Seller is required to obtain for the conduct of the Business. To the Knowledge of Seller, there is no threatened suspension, revocation, or invalidation of any such Permits.

2.12 Material Contracts.

(a) Section 2.12 of the Disclosure Letter contains a true, complete and accurate list of each of the following Purchased Contracts (all of the Purchased Contracts required to be listed thereon, the “Material Contracts”):

(i) Contracts for the service of any Business Employee or Business Contractor whose base annual cash compensation is equal to or greater than $100,000, other than employment or contractor Contracts terminable at-will with no liability;

(ii) Contracts relating to the incurrence of Indebtedness or that give or may give rise to a Lien on any of the Purchased Assets;

(iii) Contracts for the lease of any personal property primarily used in the Business or by a Business Employee;

(iv) Contracts with any Governmental Entity;

(v) Contracts with a Material Customer;

(vi) Contracts with a Material Vendor;

(vii) Contracts (A) pursuant to which any party is granted exclusive rights or “most favored party” rights of any type or scope with respect to any of the Purchased Assets, or (B) containing any non-competition covenants or other similar restrictions relating to the Purchased Assets or the conduct of the Business;

(viii) Contracts pursuant to which (A) any Third Party is granted rights to any Business Intellectual Property or other Intellectual Property rights, excluding non-exclusive licenses granted in the ordinary course of business to customers in connection with the use of products and services of the Business, non-disclosure agreements and employment agreements, or (B) any Third Party grants to Seller a license to Intellectual Property rights used in the Business (“Third Party IP”), excluding generally commercially available software or software-as-a-service costing or having an annual license fee that does not exceed $20,000, licenses to Open Source Software, non-disclosure agreements and employment agreement;

(ix) any distribution, joint market, joint venture, partnership, limited liability company, or agreement for sharing of revenues, profits, losses, costs or liabilities, or similar Contract used in respect of the Business;

(x) any Contract for the provision of products or services to, or purchase of products or services from, both the Business and other portions of the Seller not constituting the Business;

(xi) Contracts that contain any provision for indemnification of any other Person (excluding standard indemnities contained in agreements for the purchase, sale or license of any products entered into in Seller’s ordinary course operation of the Business);

(xii) any settlement agreement with respect to any Action in respect of the Business or any Business Employee resulting in (A) monetary Liability in excess of $100,000 individually, (B) material future obligations that would be Assumed Employee Liabilities, or (C) any material ongoing obligations related to the Business;

(xiii) Contracts for capital expenditures for the Business in excess of $100,000 in the aggregate;

(xiv) any powers of attorney with respect to the Business or any Purchased Asset;

(xv) any Contract under which the consequences of a default or termination would reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect;

(xvi) any Contract that would have the effect of materially prohibiting or impairing the conduct of the Business immediately after the Closing in a manner in which it was not prohibited or impaired immediately prior to the Closing; and

(xvii) any other Contract not made in the ordinary course of business that is material to the Business or the Purchased Assets.

Seller has delivered to Buyer (x) a complete and accurate copy of each written Material Contract (including all modifications, supplements and amendments thereto) and (y) a written summary of the material terms of each oral Material Contract. Except for such matters that would not be material to the Business, (i) each Material Contract is legal, valid, binding and enforceable on Seller in accordance with its terms, and is in full force and effect, (ii) Seller has performed all of the obligations required to be performed by it under each applicable Material Contract, (iii) Seller is not in breach of or default under (and is not alleged to be in breach of or default under) and no event has occurred, is pending or, to the Knowledge of Seller, is threatened, which, after the giving of notice, with lapse of time, or otherwise, would constitute a breach or default by Seller under such agreement, (iv) within the previous six months, Seller has not received any written notice of any intention to terminate any Material Contract, and (v) to the Knowledge of Seller, as of the date of this Agreement, no Person is in breach of or default under (and is not alleged to be in breach of or default under) any such Material Contract and no event has occurred, is pending or, to the Knowledge of Seller, is threatened, which, after the giving of notice, with lapse of time, or otherwise, would constitute a breach or default by any other Person under such agreement, and (vi) for those such Material Contracts to which Seller is a party, the agreement is assignable by Seller to Buyer without the consent or approval of any Person and will continue to be legal, valid, binding and enforceable and in full force and effect immediately following the Closing in accordance with the terms thereof as in effect immediately prior to the Closing.

2.13 Employees; Employee Benefit Plans.

(a) Section 2.13(a) of the Disclosure Letter sets forth a true, complete and correct list of each Plan.

(b) As applicable with respect to each Plan, Seller has made available to Buyer: (i) all written documents comprising the terms of such Plan (including amendments and individual, trust or insurance agreements relating thereto); (ii) the most recent summary annual report and Form 5500 series (including all schedules thereto) filed with respect to each Plan; (iii) the summary plan description currently in effect and all material modifications thereto; (iv) the most recent actuarial report, financial statement and trustee report; (v) in the case of any Plan that is intended to be qualified under Section 401(a) of the Code, the most recent determination or opinion letter from the Internal Revenue Services; and (vi) all non-routine correspondence with the Internal Revenue Service or United States Department of Labor concerning the Plan in the past six years.

(c) Each Plan has been maintained, operated and administered in compliance in all material respects with its terms and any related documents or agreements, and in compliance with the provisions of ERISA, the Code and other applicable Law.

(d) Each Plan intended to be qualified under Section 401(a) of the Code has received a favorable determination or approval letter from the Internal Revenue Service with respect to such qualification, or may rely on an opinion letter issued by the Internal Revenue Service with respect to a prototype plan adopted in accordance with the requirements for such reliance, and nothing has occurred that would reasonably be expected to adversely affect the qualification of such Plan.

(e) Neither Seller nor any ERISA Affiliate has sponsored, maintained, contributed to or been required to maintain or contribute to, or has any actual or contingent liability under, (i) a “defined benefit plan” as defined in Section 3(35) of ERISA or any other plan subject to Title IV of ERISA or the funding requirements of Section 302 of ERISA or Section 412 of the Code, (ii) a “multiemployer plan” as defined in Section 3(37) or 4001(a)(3) of ERISA, or (iii) a “multiple employer welfare arrangement” within the meaning of Section 3(40) of ERISA.

(f) There are no pending audits or investigations by any Governmental Entity involving any Plan, and no threatened or pending Actions (except for individual claims for benefits payable in the normal operation of the Plans) involving any Plan, any fiduciary thereof or service provider thereto, nor, to the Knowledge of Seller, is there any basis for any such Actions.

(g) No Plan provides death or medical benefits, beyond termination of service or retirement other than coverage mandated by applicable Law.

(h) Seller and each ERISA Affiliate has, for purposes of each Plan and for all other purposes, correctly classified each Business Employee as a common law employee and each Business Contractor as an independent contractor.

(i) Seller’s execution of, and performance of the transactions contemplated hereby, either alone or in combination with any other event or occurrence, will not constitute an event under any Plan that will result in any payment acceleration, vesting or increase in benefits with respect to any Business Employee or Business Contractor.

(j) No payment which is or may be made by, from or with respect to any Plan, to any Business Employee or Business Contractor, either alone or in conjunction with any other payment, event or occurrence, will or could property be characterized as an “excess parachute payment” under Section 280G of the Code. No Business Employee or Business Contractor has any “gross up” agreements or other assurance of reimbursement for any Taxes resulting from any such “excess parachute payments”.

(k) Section 2.13(k) of the Disclosure Letter sets forth a true, complete and correct list of (i) all employees of Seller engaged in the Business (the “Business Employees”) as of the date of this Agreement (including any Business Employees on a leave of absence, and international Business Employees employed by entities other than Seller) and their respective names, job titles, base cash compensation rates, target bonuses, target commissions, hire dates and, for any Business Employees on a leave of absence, the expected date of return to active employment (if known) and (ii) all independent contractors or consultants engaged in the Business (the “Business Contractors”) as of the date of this Agreement.

(l) Except as set forth on Section 2.13(l) of the Disclosure Letter, other than as required by applicable Law, there are no Contracts that are Assumed Employee Liabilities relating to the employment of the Business Employees employed by Seller on the date of this Agreement, other than Contracts that allow termination of employment without notice or payment of severance or other termination pay.

2.14 Intellectual Property.

(a) Set forth on Section 2.14(a) of the Disclosure Letter is a true, complete and correct list including, where relevant, the owner, the applicable jurisdiction, the registration number, the application number or issuance number, the date of application, issuance and/or filing, of: (i) all Registered Intellectual Property included in the Business Intellectual Property (the “Business Registered IP”); (ii) all material unregistered Business Intellectual Property; and (iii) all registered Intellectual Property and material unregistered Intellectual Property, other than Business Intellectual Property, that Seller owns or purports to own and that is used in or related to the Business (“Retained IP”). No Business Registered IP is the subject of any pending derivation, post-grant interference, reissue, reexamination, opposition or cancellation proceeding. All filing, examination, issuance, post-registration and maintenance fees, annuities, and the like associated with or required with respect to any of the Business Registered IP due or payable as of the date of this Agreement have been paid prior to the Closing. To the Knowledge of Seller, each material item of Business Registered IP is valid (or in the case of applications, applied for), enforceable and subsisting.

(b) Seller exclusively owns, or otherwise has the right to use all Business Intellectual Property. The execution, delivery and performance of this Agreement, and the transfer of the Business Intellectual Property contemplated hereby, will not affect Buyer’s ownership rights in or rights to use such Business Intellectual Property or Third Party IP immediately after Closing in any material respect.

(c) The operation of the Business as presently conducted does not infringe, misappropriate, or otherwise violate the Intellectual Property of any Person. No Action is pending or, to the Knowledge of Seller, threatened, Seller has not received written notice to the effect that the Business Intellectual Property or the operation of the Business infringes upon, misappropriates or violates the rights of any other Person under any Intellectual Property, and to the Knowledge of Seller there is no basis for a claim that the Business Intellectual Property or the conduct of the Business as currently conducted infringes upon, misappropriates or violates the rights of any other Person under any Intellectual Property. To the Knowledge of Seller, no Person is infringing upon, misappropriating or violating any Business Intellectual Property.

(d) Seller has entered into written Contracts with each current and former employee and independent contractor who contributed in any material respect to any Business Intellectual Property whereby such employee or independent contractor grants to Seller a present, irrevocable assignment of any ownership interest such employee or independent contractor may have in or to the Business Intellectual Property.

(e) Seller has taken commercially reasonable steps to maintain and enforce its rights and interest in and to the Business Intellectual Property and to preserve the confidentiality of all material trade secrets included therein, including requiring all Persons having access thereto to execute binding, written non-disclosure agreements.

(f) Except for such matters that would not be material to the Business, at no time during the conception of or reduction to practice of any of the Business Intellectual Property was Seller or any developer, inventor or other contributor to such Business Intellectual Property operating under any grants from, or performing research sponsored by, any Governmental Entity or any university or other educational institution, performing research, or subject to any employment agreement or invention assignment or nondisclosure agreement or other obligation with any Person that could adversely affect Seller’s, and after the Closing, Buyer’s, rights in such Business Intellectual Property.

(g) None of this Agreement, the consummation of the transaction contemplated hereby and the assignment to Buyer of any Purchased Contracts (including by operation of law) to which Seller is a party or by which any of its assets is bound, will result in: (i) Buyer or any of its Affiliates granting to any Person any material right to or with respect to any Intellectual Property owned by, or licensed to Buyer or any of its Affiliates, (ii) Buyer or any of its Affiliates being bound by or subject to any material exclusivity obligations, non-compete or other restriction on the operation or scope of their respective businesses, or (iii) Buyer, after the Closing, being obligated to pay any material royalties or other material amounts to any Person in excess of those payable by any of them, respectively, in the absence of this Agreement or the transactions contemplated hereby.

(h) To the Knowledge of Seller, the Purchased Software does not contain any “virus”, “worm”, “time bomb”, “key-lock”, or any other devices that would be reasonably expected to materially disrupt or interfere with the operation of the Purchased Software.

(i) Seller has not disclosed, delivered or licensed to any Person or agreed or obligated itself to disclose, deliver or license to any Person, or permitted the disclosure or delivery to any escrow agent or other Person of, any material source code included in the Purchased Software, other than disclosures to employees and consultants (i) involved in the development of Business Intellectual Property on a need-to-know basis and (ii) subject to a written confidentiality agreement with Seller. Without limiting the foregoing, neither the execution nor performance of this Agreement nor the consummation of any of the transaction contemplated hereby will result in a release from escrow or other delivery to a Third Party of any source code included in the Purchased Software.

(j) To the Knowledge of Seller, there have been no unauthorized intrusions or breaches of the security of the information technology systems used in the conduct of the Business and owned by Seller during the 12 months prior to the date of this Agreement, except as would not reasonably be expected to have a material impact on the Business.

(k) For the past three years, Seller has materially complied with all applicable Laws, internal and external privacy policies and Contracts with Third Parties, in each case relating to: (i) the use, collection, storage, disclosure and transfer of any Personal Data collected by Seller, and (ii) bulk commercial faxes and email (e.g., spam), in each case with respect to the Business or by Third Parties on behalf of the Business. Seller has implemented, and complies with, commercially reasonable technical, administrative and physical measures to assure the integrity and security of transactions executed through computer systems and of all Personal Data, in each with respect to the Business. There has been no suspected or actual material breach of security or unauthorized access to or acquisition, use, loss, destruction, compromise or disclosure of any Personal Data, confidential or proprietary data or any other information maintained or stored by or for Seller with respect to the Business (a “Material Security Breach”), and, in the two years prior to the date of this Agreement, Seller has received no written notice alleging the occurrence of a Material Security Breach. Seller has not notified any individuals of any actual or perceived data security breaches with respect to the Business under any privacy policy, contract obligation or applicable Laws requiring notice of such a breach.

(l) Section 2.14(l) of the Disclosure Letter truly, correctly, and completely identifies all open source software incorporated into or integrated with or used in the Purchased Software (the “Open Source Software”), and for each (A) identifies (by name and version number) the open source license applicable thereto; and (B) identifies a URL at which the relevant open source license is available. Except as would not be material to the Business, the Seller has not used Open Source Software in such a way that would require, as a condition of use, modification and/or distribution of such Open Source Software that other software incorporated into, derived from or distributed with such Open Source Software be (A) disclosed or distributed in source code form, (B) be licensed for the purpose of making derivative works or (C) be redistributable at no charge.

2.15 GDPR; Personal Data Protection.

(a) With respect to the Transferred Data, Seller has taken appropriate steps designed to ensure its compliance in all material respects with the GDPR.

(b) The processing by Seller of Personal Data that is Transferred Data has complied in all material respects, and as of the Closing Date complies in all material respects, with all Data Protection Laws including, to the extent applicable, to the processing of such Personal Data:

(i) the requirements relating to notification to, and/or registration of processing of Personal Data with, any Governmental Entity;

(ii) the requirement to implement reasonable and appropriate technical and organizational measures against unauthorized or unlawful processing of Personal Data and against accidental loss or destruction of, or damage to, Personal Data;

(iii) the obtaining of an agreement that complies with applicable Data Protection Laws with each data processor appointed by Seller;

(iv) the requirement to take measures approved under the Data Protection Laws in respect of the transfer of any Personal Data by or on behalf of Seller or by any of its data processors to any territory outside of the European Economic Area not approved as adequate by the European Commission;

(v) responding to data subject requests within the deadlines laid down by the Data Protection Laws;

(vi) the obtaining of consent to the processing of Personal Data and/or direct marketing activity including the ability for data subjects to ‘opt-out’ of any marketing on an ongoing basis; and

(vii) the erasure or anonymization of Personal Data when required by the Data Protection Laws (including where there is no longer a sufficient lawful basis under the GDPR and the Data Protection Act 2018 to retain it).

(c) Seller has not been the subject of an audit, investigation or questions by any Governmental Entity in relation to its compliance with the Data Protection Laws with respect to the Transferred Data in the three years before the Closing Date.

(d) Seller has not received any written notice or complaint from any individual, third party or Governmental Entity alleging, or claiming compensation in respect of, any non-compliance by Seller with the Data Protection Laws with respect to the Transferred Data in the three years before the Closing Date.

2.16 IT Systems.

(a) All Business IT Systems have been maintained and operated in accordance with industry standards. Business IT Systems operate in all material respects in accordance with their documentation and functional specifications and are in working condition to perform effectively all information technology operations necessary to conduct the Business as now conducted or as planned to be conducted. Except as set forth on Section 2.16(a) of the Disclosure Letter, since January 1, 2018, Business IT Systems have not materially malfunctioned or failed. Seller has in place commercially reasonable data storage, system redundancy and disaster avoidance and recovery programs, including providing for the regular back-up and prompt recovery of the Transferred Data and information necessary to Seller’s conduct of the Business (including data and information that is stored on magnetic or optical media in the ordinary course of business).

(b) Seller has established and complies with a written information security program or programs covering Seller that (i) includes safeguards for the security, confidentiality and integrity of transactions and confidential or proprietary Transferred Data, and (ii) is designed to protect against unauthorized access to Business IT Systems, the Transferred Data and the systems of any Third Party service providers that have access to (A) Transferred Data or (B) Business IT Systems.

(c) To the Knowledge of Seller, no Business IT System: (A) contains any bug, defect or error (including any bug, defect or error relating to or resulting from the display, manipulation, processing, storage, transmission or use of date data) that materially and adversely affects the use, functionality or performance of that Business IT System; or (B) fails to comply, or would cause Seller to fail to comply, in any material respect with any applicable warranty or other contractual commitment relating to the Business Services offered by Seller. Seller has provided to Buyer a complete and accurate list of all known material bugs, defects and errors in each version of each Business IT Systems. To the Knowledge of Seller, no Business IT System contains any “back door,” “drop dead device,” “time bomb,” “Trojan horse,” “virus” or “worm” (as such terms are commonly understood in the software industry) or any other code designed or intended to have, or capable of performing, any of the following functions: (X) disrupting, disabling, harming or otherwise impeding in any way the operation of, or providing unauthorized access to, a computer system or network or other device on which the code is stored or installed; or (Y) damaging or destroying any data or file without the user’s consent.

2.17 Sufficiency of Assets. Seller has, and will convey to Buyer, good, valid and marketable fee simple title to, or in the case of leased properties and assets, valid leasehold interests in, all of the properties and assets (whether tangible or intangible), real, personal and mixed, used or held for use in the Business by Seller and constituting a Purchased Asset, free and clear of any and all Liens, except Permitted Liens. The Purchased Assets constitute all of the assets, properties, Contracts and rights that are necessary for the provision of the Business Services in materially the same manner as the Business Services are currently offered by Seller, other than as set forth in Section 2.17 of the Disclosure Schedule; provided that this Section 2.17 does not address and will not be construed as a representation or warranty regarding any Intellectual Property infringement or misappropriation matters, which will be addressed solely by Section 2.14.

2.18 Transactions with Affiliates. Except as set forth on Section 2.18 of the Disclosure Letter, no director, manager, officer, or member of Seller or any Affiliate of Seller has (a) an ownership or contractual interest (whether direct or indirect) in any business, corporate or otherwise, which has or had any business arrangement or relationship of any kind with the Business, under which it has received or earned, payments from Seller in excess of $100,000 in any year or (b) any claim or cause of action relating to or affecting, in any material respect, the Business. All transactions required to be listed in Section 2.18 of the Disclosure Letter have been recorded in the Books and Records of Seller at their full value, as if they were rendered in arm’s length transactions.

2.19 Brokers’ Fees. Neither Seller nor any of its Affiliates has any Liability to pay any fees or commissions to any broker, finder, or agent with respect to the transactions contemplated by this Agreement or any Transaction Document.

2.20 Customers. Section 2.20 of the Disclosure Letter sets forth a true, complete and correct list of each customer or distributor of the Business and the amount of revenues generated by each such customer or distributor who, for the 12-month period ended August 31, 2019, was one of the 15 largest sources of revenue of the Business, based on amounts paid or payable with respect to such period (each, a “Material Customer”). Except as set forth on Section 2.20 of the Disclosure Letter, to the Knowledge of Seller there is no present material dissatisfaction on the part of any Material Customer with respect to the products and services of the Business. Seller has not received any information from any Material Customer that such Material Customer shall not continue as a customer of the Business after the Closing or that such Material Customer intends to terminate or materially modify existing Contracts with Seller relating to the Business, nor does Seller have any outstanding material disputes concerning any products and/or services provided by the Business to such Material Customer.

2.21 Vendors. Section 2.21 of the Disclosure Letter sets forth a true, complete and correct list of each supplier or vendor of the Business and the amount spending by each such supplier who, (a) for the 12-month period ended August 31, 2019, was one of the six largest suppliers or vendors of products and/or services to the Business, based on amounts paid or payable with respect to such period, or (b) is the sole supplier of any significant product or service to the Business that is not readily replaceable (each, a “Material Vendor”). Except as set forth on Section 2.21 of the Disclosure Letter, to the Knowledge of Seller there is no present material dissatisfaction on the part of any Material Vendor with respect to the Business. Seller has not received any information from any Material Vendor that such supplier shall not continue as a supplier to the Business or that such Material Vendor intends to terminate or materially modify existing Contracts with Seller relating to the Business, nor does Seller have any outstanding material disputes concerning the products and/or services provided by any Material Vendor.

2.22 Disclosure. No representation or warranty or other statement made by Seller in this Agreement, the Disclosure Letter, or in the other Transaction Documents contains any untrue statement or omits to state a material fact necessary to make any of them, in light of the circumstances in which it was made, not misleading. Seller does not have Knowledge of any fact that has specific application to Seller (other than general economic or industry condition) that may adversely affect the Purchased Assets or Business that has not been set forth in this Agreement or the Disclosure Letter. The Seller hereby acknowledges that, regardless of any investigation made by or on behalf of the Buyer, and regardless of the results of any such investigation, the Buyer has entered into this transaction in express reliance upon the representation and warranties of the Seller made in this Agreement.

ARTICLE III

REPRESENTATIONS AND WARRANTIES OF BUYER

Buyer represents and warrants to Seller as follows:

3.01 Organization and Corporate Power. Buyer is a corporation validly existing and in good standing under the Laws of the State of Delaware, and is qualified to do business as a foreign corporation in each jurisdiction in which the failure to be so qualified would have a Buyer Material Adverse Effect. Buyer has all requisite corporate power and authority necessary to execute, deliver, and perform its obligations under, this Agreement and the other Transaction Documents.

3.02 Due Execution and Delivery; Valid and Binding Agreement. This Agreement and the other Transaction Documents have been duly authorized, executed and delivered by Buyer. The execution and delivery by Buyer of this Agreement and the other Transaction Documents and the performance by Buyer of this Agreement and the other Transaction Documents and the consummation by Buyer of the transactions contemplated hereby and thereby have been duly and validly authorized by its board of directors, and no other corporate action on Buyer’s part is necessary to authorize the foregoing. Assuming the due execution and delivery of this Agreement by the other parties hereto, this Agreement constitutes a valid and binding obligation of Buyer, enforceable against Buyer in accordance with its terms, except as limited by the application of bankruptcy, moratorium, and other Laws affecting creditors’ rights generally and as limited by the availability of specific performance and other equitable remedies and the application of equitable principles.

3.03 Required Filings and Consents. No permit, consent, approval or authorization of, or notice or declaration to or filing with, any Governmental Entity is required in connection with any of the execution, delivery, or performance of this Agreement by Buyer, except for (i) such filings and notifications as may be required under applicable antitrust Laws or the rules of any stock exchange or marketplace and (ii) those permits, consents, approvals, authorizations, declarations and filings the failure of which to be obtained or made would not have a Buyer Material Adverse Effect.

3.04 Non-Contravention. Except for those matters which would not have a Buyer Material Adverse Effect, neither the execution nor the delivery of this Agreement by Buyer, nor the performance of its obligations hereunder by Buyer, will:

(a) violate, breach or conflict with any provision of any Law or Order to which Buyer is subject or by which Buyer is bound, or any provision of the Organizational Documents of Buyer, or any resolution adopted by the shareholders, board of directors or any committee of the board of directors of Buyer; or

3.05 Litigation. There are no Actions pending or, to the actual knowledge of Buyer, threatened against Buyer by or before any Governmental Entity, which if determined adversely to Buyer would have a Buyer Material Adverse Effect, and Buyer is not subject to any outstanding Order.

3.06 Sufficient Funds. Buyer has, and will on the Closing Date have, unrestricted cash on hand sufficient to pay all amounts required to be paid by Buyer at the Closing pursuant to the terms of Article I, and all of its and its representatives fees and expenses incurred in connection with the transactions contemplated by this Agreement.

3.07 Knowledge of Misrepresentations. Buyer does not have any knowledge that any of the representations and warranties of Seller in this Agreement are not true and correct in all material respects as of the date of this Agreement, and Buyer does not have any knowledge of any material errors in, or material omissions from, the Disclosure Letter as of the date of this Agreement. Regardless of any investigation made by or on behalf of the Buyer, and regardless of the results of any such investigation, the Buyer has entered into this transaction in express reliance upon the representation and warranties of the Seller made in this Agreement.

3.08 Brokers’ Fees. Neither Buyer nor its Affiliates has any Liability to pay any fees or commissions to any broker, finder, or agent with respect to the transactions contemplated by this Agreement for which Seller could become liable or obligated.

ARTICLE IV

OTHER COVENANTS AND AGREEMENTS

4.01 Access. For a period of seven years after the Closing Date, (i) Buyer shall preserve and retain all Purchased Books and Records and (ii) Seller may retain a copy of all Purchased Books and Records. After the Closing Date, upon reasonable prior notice, Buyer shall permit Seller to have reasonable access to, and to inspect and copy, all materials referred to in this Section 4.01 and to meet with representatives of Buyer on a mutually convenient basis in order to obtain explanations with respect to such materials and to obtain additional information and to call such representatives as witnesses; provided, however, that such access rights shall not apply in event of a dispute between the parties. The access rights under this Section 4.01 shall be subject to any limitations that are reasonably required to preserve any applicable attorney-client privilege or Third Party confidentiality obligation, in which case Seller and Buyer, as the case may be, will use commercially reasonable efforts to develop an alternative means to provide any such information that is subject to such limitations.

4.02 Tax Matters.

(a) Proration of Taxes. For all purposes under this Agreement, Taxes (or any Tax refund or amount credited against any Tax) for any taxable period that includes but does not end on the day immediately prior to the Closing Date (a “Straddle Period”) shall be allocated between the portion of the Straddle Period ending at the end of the day on the day prior to the Closing Date (the “Pre-Closing Tax Period”) and the portion of the Straddle Period commencing on the Closing Date (the “Post-Closing Tax Period”) (i) in the case of property Taxes, similar ad valorem obligations and other Taxes (or Tax refund or amount credited against Tax) imposed on or calculated by reference to a periodic basis, by multiplying the amount of such Taxes for the entire Straddle Period by a fraction the numerator of which is the number of days in the Pre-Closing Tax Period or the Post-Closing Tax Period, as applicable, and the denominator of which is the number of days in the entire Straddle Period and (ii) in the case of all other Taxes (including Taxes based on income, receipts or expenses), determined as though the taxable year terminated at the end of the day on the day prior to the Closing Date. Seller shall be liable for the amount of such Taxes that is apportioned to the Pre-Closing Tax Period, and Buyer shall be liable for the amount of such Taxes that is apportioned to the Post-Closing Tax Period.

(b) Cooperation. The parties hereto shall reasonably cooperate with one another in the preparation of all Tax Returns, questionnaires, applications and other similar documents relating to Taxes and in connection with any Tax audit or other Tax proceeding relating to the Purchased Assets, including making reasonably available to the other party all applicable information, records, and documents in their respective possession or under their respective control. The parties hereto shall retain records, documents, accounting data and other information in whatever form that are reasonably necessary for the preparation and filing, or for any Tax audit, of any Tax Returns with respect to the Purchased Assets for any Tax period or portion thereof ending on or prior to the Closing Date for the duration of the applicable statute of limitations period.

4.03 Employee Matters.

(a) Post-Closing Employment Arrangements - Transferred Employees. At least three Business Days prior to the Closing Date, Buyer shall extend, or shall cause its Affiliates to extend, employment offers to each Business Employee who is actively employed immediately prior to the Closing Date and who Buyer, in its sole discretion, lists on Section 4.03(a) of the Disclosure Letter, with such employment to be effective as of 12:01 a.m. on the Closing Date. Such employment offers shall satisfy the following requirements for a period of at least 12 months following the Closing Date: (i) substantially the same duties and responsibilities (unless such Business Employee consents to enhanced duties and responsibilities), (ii) at least the same level of base pay, (iii) the same crediting of years of service (including any portions thereof credited by Seller), and (iv) bonus potential and other compensation and benefits that are no less favorable in the aggregate to those provided to similarly situated employees of Buyer, but in no event less favorable than such employee’s existing bonus potential and other compensation and benefits, all as in effect with respect to the applicable Business Employee immediately prior to the Closing Date and in all cases in compliance with applicable Law. The Business Employees who accept Buyer’s offer of employment shall be referred to herein as “Transferred Employees”.

(b) Effective as of 12:01 a.m. on the Closing Date, the Transferred Employees shall cease all active participation in and accrual of benefits under the Plans (the “Retained Plans”). Seller shall retain sponsorship of, and shall retain and indemnify and hold harmless Buyer and its Affiliates against, all Liabilities under the Retained Plans, whether arising before, on or after the Closing, and Buyer and its Affiliates shall not assume sponsorship of, contribute to or maintain, or have any Liability with respect to, the Retained Plans.

(c) Except as would result in a duplication of benefits for the same period of service, for purposes of eligibility to participate, vesting and, solely for the purposes of vacation, paid-time-off and/or severance plans, level of benefits under the employee benefit plans of Buyer and its Affiliates providing benefits to any Transferred Employees after the Closing (the “New Plans”), Buyer shall cause each Transferred Employee to receive credit for all service with Seller before the Closing (including predecessor or acquired entities or any other entities with respect to which Seller has given credit for prior service) to the extent recognized in any similar Plan in which such Transferred Employee participated immediately prior to the Closing; provided, however, that such crediting shall not apply to defined benefit, equity or equity derivative or non-qualified deferred compensation plans.

(d) Seller shall pay to each Transferred Employee all amounts in respect of vacation days and other paid time off accrued but not taken by such Transferred Employee on or prior to the Closing. Buyer shall have no obligation to honor such accrued vacation days or paid time off after the Closing. Following the Closing, the Transferred Employees’ eligibility for vacation and other paid time off shall be determined under Buyer’s vacation policy.

(e) Buyer agrees to cause a defined contribution plan that includes a qualified cash or deferred arrangement within the meaning of Section 401(k) of the Code (and a related trust exempt from tax under Section 501(a) of the Code) (as applicable, the “Buyer 401(k) Plan”) to allow each Transferred Employee to make a “direct rollover” to the Buyer 401(k) Plan of the account balances of such Transferred Employee (but not including promissory notes evidencing any outstanding loans) under the Plan that is a defined contribution plan that includes a qualified cash or deferred arrangement within the meaning of Section 401(k) of the Code (a “Seller 401(k) Plan”) in which such Transferred Employee participated prior to the Closing if such Seller 401(k) Plan permits such a direct rollover and if such direct rollover is elected in accordance with applicable Law by such Transferred Employee. The rollovers described herein shall comply with applicable Law, and each party shall make all filings and take any actions required of such party under applicable Law in connection therewith. Buyer shall have no responsibility for any failure of Seller to properly administer the Seller 401(k) Plan in accordance with its terms and applicable Law, including without limitation any failure to properly administer the accounts of Transferred Employees and their beneficiaries who effect a direct rollover pursuant to this Section 4.03(e).

(f) If not already paid by the Seller prior to the Closing, the Seller shall make a quarterly bonus payment to the Transferred Employee for the third quarter ended September 30, 2019. Seller may determine the Q3 2019 quarterly bonus amount using any good faith methodology (which need not be the same for each Transferred Employee), including, without limitation, by basing such amount upon target bonus or upon actual performance. Such quarterly bonus shall be paid no later than the date on which Seller pays comparable quarterly bonuses to similarly situated other employees of Seller and its Affiliates.

(g) Each Transferred Employee will be eligible to participate immediately, without any waiting time, in any New Plan to the extent coverage under such New Plan replaces coverage under a similar or comparable Plan in which such Transferred Employee participated immediately before the Closing, and for purposes of each New Plan providing medical, dental, pharmaceutical, vision and/or disability benefits to any Transferred Employee, Buyer shall cause all pre-existing condition exclusions and actively-at-work requirements of such New Plan to be waived for such Transferred Employee and his or her covered dependents, to the extent any such exclusions or requirements were waived or were inapplicable under a similar or comparable Plan in which such Transferred Employee participated immediately before the Closing, and shall cause any co-payments, deductibles and out-of-pocket expenses paid by such Transferred Employee and his or her covered dependents during the portion of the plan year of the similar or comparable Plan in which such Transferred Employee participated immediately before the Closing ending on the date such Transferred Employee’s participation in the corresponding New Plan begins to be taken into account under such New Plan as if such amounts had been paid in accordance with such New Plan, in each case to the extent all information reasonably necessary to implement such actions has been received from Seller.

(h) Seller shall pay, perform or otherwise discharge, as the same shall become due and payable, in accordance with their respective terms, each of the following, without duplication (the “Excluded Employee Liabilities”):

(i) any Liabilities relating to current or former employees of Seller who are not Business Employees or who are not Transferred Employees (or their respective covered family members); and

(ii) any Liabilities relating to Business Employees and Business Contractors (or their covered family members) that arise as a result of an event or events that occurred prior to 12:01 am on the Closing Date (including, without limitation, any and all Liabilities (including statutory or contractual severance benefits) arising as a result of the actual or constructive termination of a Business Employee’s employment with Seller as a result of the transactions contemplated by this Agreement).

(i) Buyer shall pay, perform or otherwise discharge, as the same shall become due and payable, in accordance with their respective terms, any Liabilities relating to Transferred Employees (or their covered family members), that arise as a result of an event or events that occurred on or after 12:01 am on the Closing Date (the “Assumed Employee Liabilities”).

(j) Buyer and Seller reasonably cooperate in all matters reasonably necessary to document to the applicable Governmental Entity, their “successor-in-interest” relationship with respect to any Affected Foreign Employees.

(k) Seller shall be solely responsible for compliance with the requirements of Section 4980B of the Code and Part 6 of Subtitle I of ERISA, including provision of continuation coverage (within the meaning of COBRA), with respect to all Business Employees, and their respective eligible spouses and dependents, for whom a qualifying event (within the meaning of COBRA) occurs at any time on or prior to the Closing Date (including qualifying events that occur in connection with the transactions contemplated hereby).

(l) Nothing contained in this Section 4.03, whether express or implied, may be construed to (i) create any Third Party beneficiary or other rights in any person other than the parties to this Agreement, (ii) constitute an establishment, amendment, modification or termination of, or an undertaking to establish, amend, modify or terminate, any Plan, New Plan or other benefit or compensation plan, (iii) prohibit or limit the ability of Seller, Buyer or any of their respective Affiliates to establish, amend, modify or terminate any Plan, New Plan or other benefit or compensation plan, or (iv) create any obligation on the part of Buyer or any of its Affiliates, as applicable, to continue to employ or engage for the performance of services any person (including any Transferred Employee), or to limit the ability of Buyer or any of its Affiliates to terminate the employment or service of any person at any time for any or no reason.

4.04 Public Announcements.

(a) Buyer and Seller shall cooperate in the preparation of separate public announcements of the transactions contemplated hereby. Each of Buyer and Seller shall review in good faith any reasonable comments of the other party on such public announcements in advance of issuance thereof.

(b) Except as provided for in Section 4.04(a), Buyer, on the one hand, and Seller, on the other hand, agree that, no public release or announcement concerning the transactions contemplated hereby shall be issued or made by or on behalf of the other without such party’s prior consent, which consent shall not be unreasonably delayed, conditioned or withheld; provided, however, that in the event such public announcement is required by applicable Law, the party required to make such public announcement may do so without such consent if the other party does not provide its consent within the timeframe allowed by applicable Law for the making of such public announcement.

(c) Nothing in this Section 4.04 shall prohibit the Buyer or Seller from including information regarding the transactions contemplated hereby or this Agreement in any filings made by such party with the Securities and Exchange Commission where the inclusion of such information or this Agreement is required by applicable Law.

4.05 Buyer Financial Statements and Audit. For a period of twelve months after the Closing, Seller shall provide commercially reasonable assistance to Buyer, on reasonable prior notice, in the preparation, review and audit of the financial statements (including pro-forma financial statements) and other financial information regarding the Business that are determined by Buyer, on the advice of counsel or Buyer’s independent registered public accounting firm, to be required to be included in the financial reports and other public disclosures of Buyer. Such cooperation shall include (a) authorizing any independent registered public accounting firm utilized by the Seller to share its work papers and other information of such firm related to the audit of the Seller’s financial statements relevant to the operations and financial condition and performance of the Business and (b) providing access, at Buyer’s sole cost and expense, to any Books and Records retained by the Seller that are necessary for Buyer’s independent registered public accounting firm auditing such financial statements to perform its review and audit, including the execution and delivery by Seller of a customary representation letter to such accounting firm (if and to the extent reasonably required or requested by such accounting firm).

4.06 Proprietary Information.(a) From and after the Closing, Seller shall not, and shall cause its Affiliates and representatives not to, disclose (except to pursue its rights under this Agreement or any of the Transaction Documents) or make use of (except to pursue its rights or perform its obligations under, or as otherwise contemplated by, this Agreement or any of the Transaction Documents) any knowledge, information or documents of a confidential nature or not generally known to the public to the extent related to any of the Purchased Assets, the Business, or Buyer or its businesses (including the financial information, technical information or data relating to any of the Purchased Assets and including filings and testimony (if any) presented in the course of any litigation to the extent that the same can be filed under seal or subjected to a protective order, either as of right or at no more than de minimis cost to Seller). Notwithstanding anything to the contrary, the preceding sentence shall not apply to knowledge, information or documents that have become public knowledge other than through improper disclosure by Seller or its Affiliates and representatives. From and after the Closing, Seller shall, at Buyer’s sole cost and expense:

(i) enforce (or cause its Affiliates to) enforce, for Buyer’s benefit, all confidentiality, non-disclosure and similar agreements between Seller or any of its Affiliates (on the one hand) and any Person who as of the date hereof is an employee or contractor of any Seller or any of its Affiliates (on the other hand) to the extent relating to any of the Purchased Assets or the Business, in accordance with their terms (except to the extent it would be commercially unreasonable for Seller to enforce such agreement);

(ii) notify Buyer promptly after becoming aware of any material violation by any such employee or any other Person of any such agreement; and

(iii) not materially waive or agree to any modification of any provision of any such agreement that relates to confidentiality or non-disclosure of information (and to the extent such provision relates to any of the Purchased Assets or the Business) without the prior written consent of Buyer.

(b) From and after the Closing, Buyer shall not, and shall cause its Affiliates and representatives not to, disclose (except to pursue its rights under this Agreement or any of the Transaction Documents) or make use of (except to pursue its rights or perform its obligations under, or as otherwise contemplated by, this Agreement or any of the Transaction Documents) any knowledge, information or documents of a confidential nature or not generally known to the public to the extent related to any of the Excluded Assets (including the financial information, technical information or data relating to any such assets and including filings and testimony (if any) presented in the course of any litigation to the extent that the same can be filed under seal or subjected to a protective order, either as of right or at no more than de minimis cost to Buyer). Notwithstanding anything to the contrary, the preceding sentence shall not apply to knowledge, information or documents that have become public knowledge other than through improper disclosure by Buyer or its Affiliates and representatives.

(c) Nothing in this Section 4.06 shall prohibit Buyer or Seller from disclosing and providing copies of this Agreement or any of the Transaction Documents from complying with any disclosure obligations they may have under applicable Laws.

4.07 Fees and Expenses. Buyer shall pay all fees and expenses incurred by Buyer in connection with this Agreement and the transactions contemplated hereby. Seller shall pay all fees and expenses incurred by Seller in connection with this Agreement and the transactions contemplated hereby.

4.08 Transfer Taxes . All transfer, documentary, sales, use, stamp, registration, and other similar Taxes, and all conveyance fees, recording charges, and other fees and charges (including any related fees and penalties) incurred in connection with the transactions contemplated by this Agreement shall be paid one-half by Buyer and one-half by Seller when due, and the party obligated by Law to do so shall file all necessary Tax Returns and other documentation with respect to all such Taxes, fees, and charges.

4.09 Termination of Overhead and Shared Services. Buyer acknowledges and agrees that, effective as of the Closing Date, (a) all Overhead and Shared Services provided to the Business shall cease and (b) Seller or its Affiliates shall have no further obligation to provide any such Overhead and Shared Services with respect to the Business.

4.10 Use of Names. Other than the Trademarks listed on Section 1.01(a)(i)(B) of the Disclosure Letter, Seller and its Subsidiaries are not conveying any ownership interest or rights in, or granting Buyer or any Affiliate of Buyer a license to use, any of the Trademarks of Seller or any of its Affiliates (collectively, the “Seller Trademarks”).

(a) After the Closing, Buyer shall cause its Affiliates to cease and discontinue use in any manner of Seller Trademarks or any Trademark that is confusingly similar to any of the foregoing except for historical factual purposes, for “fair use”. In the event Buyer or any of its Affiliates breaches any of its obligations under this Section 4.10, Seller may proceed against it at law or in equity for such damages or other relief as a court may deem appropriate. Buyer acknowledges that a breach of this Section 4.10 will cause Seller and its Affiliates irreparable harm for which monetary damages would be an inadequate remedy, and Buyer therefore agrees that in the event of any actual or threatened violation of this Section 4.10, Seller shall be entitled, in addition to other remedies that it may have, to a temporary restraining order and to preliminary and final injunctive relief against Buyer or such Affiliate of Buyer to prevent any continuing breaches of this Section 4.10, without posting any type of bond or other security as a condition for seeking such relief.

(b) After the Closing, Seller shall cause its Affiliates to cease, discontinue use in any manner of, and remove from any assets any Trademarks listed on Section 1.01(a)(i)(B) of the Disclosure Letter or any Trademark that is confusingly similar to any of the foregoing except for historical factual purposes, for “fair use”. In the event Seller or any of its Affiliates breaches any of its obligations under this Section 4.10, Buyer may proceed against it at law or in equity for such damages or other relief as a court may deem appropriate. Seller acknowledges that a breach of this Section 4.10 will cause Buyer and its Affiliates irreparable harm for which monetary damages would be an inadequate remedy, and Seller therefore agrees that in the event of any actual or threatened violation of this Section 4.10, Seller shall be entitled, in addition to other remedies that it may have, to a temporary restraining order and to preliminary and final injunctive relief against Seller or such Affiliate of Seller to prevent any continuing breaches of this Section 4.10, without posting any type of bond or other security as a condition for seeking such relief. In no event shall Seller or its respective Affiliates use the “Perfect Audience” brand name or any other brand names which are generally associated with the Business following the Closing for purposes of marketing or selling any products or services.

4.11 Restrictive Covenants.

(a) Non-Solicitation. For a period of one year commencing on the Closing Date (the “Restricted Period”), the Seller and its Affiliates shall not, directly or indirectly, hire or solicit any Transferred Employee, or encourage any such employee to leave such employment or hire any such employee who has left such employment, except pursuant to a general solicitation which is not directed specifically to any such employees; provided, that nothing in this Section 4.11(a) shall prevent Seller or its respective Affiliates from soliciting for employment or hiring (i) any employee whose employment has been terminated by Buyer or (ii) after one hundred eighty (180) days from the date of termination of employment, any employee whose employment has been terminated by the employee.

(b) Non-Competition. During the Restricted Period, Seller shall not, and shall not permit its Affiliates to, directly or indirectly, solicit or entice, or attempt to solicit or entice, any Transferred Customers to purchase products or services from Seller (or such Affiliate, as applicable) that are directly competitive with the Business. Notwithstanding anything to the contrary in this Section 4.11(b), the foregoing covenant shall not apply with respect to any Person or its Affiliates that acquires an interest in at least a majority of the stock or all or substantially all of the assets of Seller if, as of immediately prior to the consummation of such transaction, such Person or its Affiliates are engaged in a line of business that is directly competitive with the Business. For the avoidance of doubt, nothing in this Section 4.11(b) shall restrict Seller or its Affiliates from selling products or services to any Third Party that are offered by Seller or such Affiliate, as applicable, as of the Closing Date and are not related to the Business.

(c) Seller hereby acknowledges that the restrictions contained in this Section 4.11 are reasonable and necessary to protect the legitimate interests of Buyer and constitute a material inducement to Buyer to enter into this Agreement and consummate the transactions contemplated by this Agreement. In the event that any covenant contained in this Section 4.11 should ever be adjudicated to exceed the time, geographic, product or service, or other limitations permitted by applicable Law in any jurisdiction, then any court is expressly empowered to reform such covenant, and such covenant shall be deemed reformed, in such jurisdiction to the maximum time, geographic, product or service, or other limitations permitted by applicable Law. The covenants contained in this Section 4.11 and each provision hereof are severable and distinct covenants and provisions. The invalidity or unenforceability of any such covenant or provision as written shall not invalidate or render unenforceable the remaining covenants or provisions hereof, and any such invalidity or unenforceability in any jurisdiction shall not invalidate or render unenforceable such covenant or provision in any other jurisdiction.

4.12 Non-Transferable Sub-Domain

(a) Until the fifth anniversary of the Closing Date, or such earlier date as the Parties may mutually agree, Seller shall:

(i) maintain the registration of the second-level domain for the Internet sub-domain listed on Section 1.01(b)(i) of the Disclosure Letter (the “Non-Transferable Sub-Domain”);

(ii) at Buyer’s option, either (x) resolve DNS requests to the Non-Transferable Sub-Domain to such server(s) as is specified by Buyer from time to time (“via CNAME, A, or AAAA records”); or (y) refer DNS requests related to the Non-Transferable Sub-Domain to a Buyer-managed DNS service (“via NS records”);

(iii) restrict access to the management system of Seller for the Non-Transferable Sub-Domain to a minimum number of appropriate employees of Seller;

(iv) respond promptly to all DNS change requests from Buyer related to the Non-Transferable Sub-Domain and all requests from Buyer for information regarding the Non-Transferable Sub-Domain; and

(v) maintain all documentation and records related to the Non-Transferable Sub-Domain.

(b) Seller acknowledges that a breach of Section 4.12(a)(i) or (ii) may cause the Buyer significant harm, the financial impact of which may be difficult to calculate, and in the event of such a breach agrees to pay to the Buyer the following amounts as liquidated damages and not as a penalty, which shall be the sole and exclusive remedy of Buyer for matters set out in this Section 4.12:

(i) $1,500 for every hour the Non-Transferable Sub-Domain is un-resolvable during the first twelve-month period following the Closing Date;

(ii) $500 for every hour the Non-Transferable Sub-Domain is un-resolvable during the second twelve-month period following the Closing Date;

(iii) $200 for every hour the Non-Transferable Sub-Domain is un-resolvable after the second twelve-month period following the Closing Date until the fifth anniversary of the Closing Date; and

(iv) in addition to and without limiting the foregoing, $50,000 for any 30-day period following the Closing Date during which there are three or more incidents of the Non-Transferable Sub-Domain being un-resolvable.

For purposes of this Section 4.12(b), un-resolvability will be identified by a third-party monitoring service to be reasonably agreed by Buyer and Seller and shall be determined in a manner designed to reflect expected consumer experience (i.e., to include cache coverage).

Seller shall not be required to pay any penalties related to site unavailability other than name resolution, or related to name resolution issues attributable to downtime by the relevant providers including the name registrar (currently Go Daddy), the DNS provider (currently AWS), the CDN (fastly), carriers, or the hosting provider or the Perfect Audience application itself.

At Seller’s discretion, Seller may extend the time-to-live for the Non-Transferable Sub-Domain pointers to up to 24 hours outside of planned maintenance windows.

In no event shall the liquidated damages payable by Seller hereunder as set forth in this Section 4.12(b) exceed an aggregate amount equal to the Closing Cash Purchase Price.

(c) For a period of 60 days following the Closing, Seller shall use its commercially reasonable efforts to enter into an agreement, in form and substance reasonably approved by the Buyer, with a third-party that is reasonably acceptable to the Buyer (the “Domain Maintenance Agent”) by which the Domain Maintenance Agent shall agree to keep the Non-Transferable Sub-Domain active until the fifth anniversary of the Closing Date in the event the Seller winds up, dissolves or otherwise ceases its operations (the “Domain Maintenance Agreement”).

(d) Seller agrees that it shall not reorganize, consolidate or merge with, or be acquired by, another Person following the Closing Date unless any documentation related to such reorganization, consolidation, merger or acquisition explicitly acknowledges the provisions and obligations of this Section 4.12 and, where applicable, any successor Persons, explicitly agrees to abide by this Section 4.12 and fulfill the obligations of Seller in this Section 4.12.

(e) Buyer agrees to use commercially reasonable efforts (i) to stop using the Non-Transferable Sub-Domain as soon as possible following the Closing for all new customers of the Business and (ii) to transition existing customers of the Business away from accessing the Non-Transferable Sub-Domain.

(f) Each party will cooperate with and assist the other parties in taking such acts as may be appropriate to enable all parties to effect compliance with the terms of this Section 4.12 and to carry out the true intent and purposes hereof.

4.13 Transition SRE Services. The Seller agrees to provide SRE services to Buyer for a transition period from the Closing Date through January 6, 2020. Such services shall be provided by Seller in substantially the same manner as such services are provided to the Business prior to the Closing. The Seller will notify the Buyer of all alerts primarily related to the Business as promptly as practicable and will provide such other information to Buyer as Buyer shall reasonably request.

4.14 Further Assurances; Post-Closing Payments.

(a) General Assurances. In addition to the actions specifically provided for elsewhere in this Agreement, each of the parties will cooperate with each other and use its reasonable efforts after the Closing Date, to take, or cause to be taken, all actions, and to do, or cause to be done, all things reasonably necessary or appropriate on its part to consummate and make effective, in the most expeditious manner practicable, the transactions contemplated by this Agreement and the Transaction Documents, including the execution and delivery of such other instruments, certificates, agreements and other documents and the performance of such other actions as may be necessary or reasonably desirable to consummate and implement expeditiously the transactions contemplated by this Agreement and the other Transaction Documents; provided that all such actions are in accordance with applicable Law. Notwithstanding the foregoing, from time to time, whether at or after the Closing but subject to Section 1.01(e), Seller and its Subsidiaries (as appropriate) will execute and deliver such further instruments, certificates, agreements and other documents and perform such other actions as Buyer may reasonably require to fully and effectively transfer, convey and assign to Buyer, and to fully vest in Buyer rights to, title in, and ownership of, and to place Buyer in actual possession and operating control of, (i) any of the Purchased Assets or (ii) any other asset owned by Seller or such Subsidiary that would be required to be delivered to Buyer in order to make the representation and warranty set forth in Section 2.17 true and correct in all respects (it being understood that any asset delivered pursuant to this Section 4.14(a)(ii) shall be deemed to constitute a Purchased Asset for all purposes hereunder). The obligations of each party under this Section 4.14(a) shall expire 12 months after the Closing Date.

(b) Payments; Deliveries. In the event that, on or after the Closing, either party receives payments or funds due or belonging to the other party pursuant to the terms of this Agreement or any of the Transaction Documents, then the party receiving such payments or funds shall promptly forward or cause to be promptly forwarded such payments or funds to the proper party (with appropriate endorsements, as applicable), and will account to such other party for all such receipts. The parties acknowledge and agree that, except as otherwise provided in this Agreement, there is no right of offset regarding such payments and a party may not withhold funds received from Third Parties for the account of the other party in the event there is a dispute regarding any other issue under this Agreement or any other Transaction Documents. Without limiting the foregoing provisions of this Section 4.14(b), Seller agrees that Buyer shall, following the Closing, have the right and authority to endorse any checks or drafts received by Buyer in respect of any account receivable of the Business included in the Purchased Assets and Seller shall furnish to Buyer such evidence of this authority as Buyer may reasonably request. Following the Closing, if Buyer or its Affiliates receives any mail or packages addressed to Seller or its Subsidiaries and delivered to Buyer not relating to the Business, the Purchased Assets or the Assumed Liabilities, Buyer shall promptly deliver (or cause to be delivered) such mail or packages to Seller. Following the Closing, if Seller or its Subsidiaries receives any mail or packages delivered to Seller relating to the Business, the Purchased Assets or the Assumed Liabilities, Seller shall promptly deliver (or cause to be delivered) such mail or packages to Buyer.

4.15 No Additional Representations; Disclaimer. Buyer acknowledges and agrees that Seller has not, nor has any of its Affiliates or representatives, nor has any other Person acting on behalf Seller or any of its Affiliates or representatives, made any (and Buyer and its Affiliates have not relied on any) representation or warranty, express or implied, as to the accuracy or completeness of any information regarding Seller or any of its businesses or assets, except as expressly set forth in this Agreement or the other Transaction Documents. Buyer acknowledges that it is relying on the express representations and warranties of the Seller set forth in Article II (including the related portions of the Disclosure Letter or any representations and warranties included in any other Transaction Document) and on its own investigation and analysis in entering into the transactions contemplated hereby.

ARTICLE V

INDEMNIFICATION

5.01 No Survival. Other than with respect to claims arising due to Fraud, the representations and warranties of the parties set forth in this Agreement (other than the Covered Representations) or in any certificate delivered pursuant to this Agreement shall terminate and expire as of the Closing. Other than with respect to claims arising due to Fraud, the Covered Representations shall terminate and expire as of the date that is one year after the Closing Date.

5.02 Indemnification by Seller. From and after the Closing (but subject to the provisions of this Article V), Seller shall indemnify and hold harmless Buyer, its Affiliates, and their respective officers, directors, shareholders, partners, members, managers, employees, agents, and representatives (the “Buyer Indemnified Parties”) against any and all Losses incurred by Buyer Indemnified Parties arising out of:

(a) any of the Excluded Liabilities; and

(b) any misrepresentation or inaccuracy (or omission of required disclosure) in any Covered Representation.

5.03 Indemnification by Buyer. From and after the Closing (but subject to the provisions of this Article V), Buyer shall indemnify and hold harmless Seller, its Affiliates, and their respective officers, directors, partners, shareholders, members, managers, employees, agents, and representatives (the “Seller Indemnified Parties”) against any and all Losses incurred by Seller Indemnified Parties arising out of any of the Assumed Liabilities.

5.04 Limits on Indemnification; Determination of Losses.

(a) The amount of any Losses shall be determined net of any amounts actually recovered by such Person or any of its Affiliates under or pursuant to any insurance policy, title insurance policy, indemnity, reimbursement arrangement, or Contract pursuant to which or under which such Person or such Person’s Affiliates is a party or has rights.

(b) “Losses” shall not be deemed to include, consequential, incidental or indirect damages, lost profits, or punitive, special, or exemplary damages and, in particular, no “multiple of profits” or “multiple of cash flow” or similar valuation methodology shall be used in calculating the amount of any Losses; provided, however, that the foregoing limitation shall not apply to the extent such Losses arise from a Third-Party Claim.

(c) With the exception of Losses pertaining to Section 4.12, Seller shall not be liable to the Buyer Indemnified Parties for indemnification under Section 5.02(b) for any Loss unless and until the aggregate amount of all Losses in respect of indemnification under Section 5.02(b) exceeds $100,000 (the “Deductible”), in which event Seller will be liable for all such Losses in excess of the Deductible, subject to Section 5.04(d).

(d) The aggregate indemnification obligations of Seller pursuant to Section 5.02(b) shall not exceed the Closing Cash Purchase Price.

5.05 Indemnification Procedures.

(a) In order for a Person that has rights of indemnification under this Agreement (each, an “Indemnified Party”) to be entitled to any indemnification provided for under this Agreement, such Indemnified Party must notify the indemnifying party (the “Indemnifying Party”) in writing, and in reasonable detail, of a claim or demand made by any Person against the Indemnified Party (a “Third-Party Claim”) as promptly as reasonably possible after receipt by such Indemnified Party of notice of the Third-Party Claim; provided that the failure to give such notification on a timely, complete or accurate basis shall not affect the indemnification provided hereunder except to the extent the Indemnifying Party shall have been materially prejudiced as a result of such failure. Thereafter, the Indemnified Party shall deliver to the Indemnifying Party, promptly after the Indemnified Party’s receipt thereof, copies of all notices and documents (including court papers) received by the Indemnified Party relating to the Third-Party Claim.

(b) If a Third-Party Claim is made against an Indemnified Party, the Indemnifying Party shall be entitled to participate in the defense thereof and, if it elects, to assume the defense thereof. Should an Indemnifying Party elect to assume the defense of a Third-Party Claim, the Indemnifying Party shall not be liable to the Indemnified Party for legal expenses subsequently incurred by the Indemnified Party in connection with the defense thereof. If the Indemnifying Party assumes such defense, the Indemnified Party shall have the right to participate in the defense thereof and to employ counsel, at its own expense, separate from the counsel employed by the Indemnifying Party, it being understood that the Indemnifying Party shall control such defense.

(c) Notwithstanding the foregoing, the Indemnified Party, at the Indemnifying Party’s expense, shall have the right to conduct and control, through counsel of its choosing, the defense, compromise and settlement of any Third-Party Claim if (i) such Third-Party Claim involved any criminal allegations or allegations of fraud (including Fraud) against the Indemnified Party, (ii) involved any of the Indemnified Party’s material customers, payors, or suppliers, (iii) the Indemnified Party reasonably believes an adverse determination with respect to such Third-Party Claim would be detrimental to or injure the Indemnified Party’s reputation or future business prospects, or (iv) such Third-Party Claim seeks an injunction or other equitable or non-monetary relief against the Indemnified Party. Additionally, the Indemnifying Party shall lose its right to contest, defend, litigate and settle a Third-Party Claim if it shall fail to accept a tender of the defense of the Third-Party Claim in the manner set forth herein or it shall fail to diligently contest the Third-Party Claim in the reasonable judgment of the Indemnified Party.

(d) If the Indemnifying Party chooses to defend any Third-Party Claim, all the parties hereto shall cooperate in the defense or prosecution of such Third-Party Claim. Such cooperation shall include the retention and (upon the Indemnifying Party’s written request and at its expense) the provision to the Indemnifying Party of records and information that are reasonably relevant to such Third-Party Claim, and making employees available on a mutually convenient basis to provide additional information and explanation of any material provided hereunder. Notwithstanding the foregoing, no Indemnified Party shall be obligated to provide (i) information that is subject to attorney-client privilege or attorney work-product, or (ii) information that such party reasonably believes to be market sensitive, competitive or strategic in nature.

(e) Whether or not an Indemnifying Party shall have assumed the defense of a Third-Party Claim, no Indemnified Party shall admit any Liability with respect to, consent to the entry of any judgment, or settle, compromise or discharge any Third-Party Claim without the prior written consent (which shall not be unreasonably withheld, conditioned, or delayed) of the Indemnifying Party. If the Indemnifying Party shall control the defense of any Third-Party Claim, the Indemnifying Party shall not admit any Liability with respect to, consent to the entry of any judgment, or settle, compromise or discharge, any such Third-Party Claim without the prior written consent (which shall not be unreasonably withheld, conditioned, or delayed) of the Indemnified Party.

(f) Any indemnity payment under this Agreement shall be treated as an adjustment to the Purchase Price for Tax purposes to the extent permitted by applicable Law.

5.06 Exclusive Remedy. Each party acknowledges and agrees that, from and after the Closing, its sole and exclusive remedy with respect to any and all claims relating to the subject matter of this Agreement, the Disclosure Letter and the transactions contemplated hereby shall be pursuant to the indemnification provisions set forth in this Article V; provided, however that the foregoing limitation shall not apply (i) any and all claims relating to the subject matter of any other Transaction Document or the transactions contemplated thereby, (ii) to claims arising due to Fraud or (iii) the remedies of specific performance and injunctive or other equitable relief to the extent expressly permitted elsewhere in this Agreement. In furtherance of the foregoing, each Indemnified Party hereby waives, from and after the Closing, to the fullest extent permitted under applicable Law, any and all rights, claims, and Actions it may have against any Indemnifying Party (other than pursuant to this Article V or the exceptions enumerated herein) relating to the subject matter of this Agreement, the Disclosure Letter, and the transactions contemplated hereby, whether arising under or based upon any federal, state, local or foreign Law or otherwise.

5.07 Indemnification Payments. Any amounts owing pursuant to this Article V shall be made within five Business Days after Losses have been awarded by a final, non-appealable order or judgment of a court of competent jurisdiction or determined pursuant to a written, executed agreement between Buyer and Seller.

ARTICLE VI

Miscellaneous

6.01 Amendment and Waiver. This Agreement may be amended or waived only in a writing signed by Buyer and Seller. No waiver of any provision hereunder or any breach or default thereof shall extend to or affect in any way any other provision or prior or subsequent breach or default, and no failure or delay to enforce, or partial enforcement of, any provision of this Agreement shall operate as a waiver of such provision or of any other provision.

6.02 Notices. All notices, requests, consents, claims, demands, waivers and other communications hereunder shall be in writing and shall be deemed given if delivered personally or by commercial delivery service, or mailed by registered or certified mail (return receipt requested) or sent via electronic mail to the parties hereto at the following address (or at such other address for a party as shall be specified by like notice):

To Seller:

Marin Software Incorporated

123 Mission Street, 27th Floor

San Francisco, CA 94105

Attn: Chris Lien

Email: clien@marinsoftware.com

with copies (which shall not constitute notice) to:

Fenwick & West LLP

902 Broadway, Suite 14

New York, NY 10010

Attn: Ken S. Myers & David A. Frydman

Email: kmyers@fenwick.com & dfrydman@fenwick.com

To Buyer:

SharpSpring, Inc.

5001 Celebration Pointe Ave. – Suite 410

Gainesville, FL 32608

Attn: Rick Carlson, Founder & CEO

Email: rick@sharpspring.com

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

Pepper Hamilton LLP

2000 K Street, N.W., Suite 600

Washington, DC 20006-1865

Attn: David Wormser & Scott Jones

Email: wormserd@pepperlaw.com & jonessr@pepperlaw.com

6.03 Assignment; No Third-Party Beneficiaries. This Agreement shall not be assigned by operation of law or otherwise; provided that any or all rights and obligations of a party may be assigned to one or more Affiliates. Subject to the foregoing, this Agreement shall be binding on and inure solely to the benefit of the parties hereto and their respective successors, heirs, legal representatives and permitted assigns. Nothing in this Agreement, express or implied, is intended to or shall confer upon any other Person other than the parties hereto or their respective successors and permitted assigns any right, benefit, remedy or Liability of any nature whatsoever under or by reason of this Agreement (except that Article V is intended to benefit the Persons covered thereby or to be paid thereunder and may be enforced by such Persons).

6.04 Severability. If any term or other provision of this Agreement is invalid, illegal, or incapable of being enforced by any rule of Law, or public policy, all other conditions and provisions of this Agreement shall nevertheless remain in full force and effect so long as the economic or legal substance of the transactions contemplated by this Agreement is not affected in any manner adverse to any party hereto. Upon such determination that any term or other provision is invalid, illegal, or incapable of being enforced, the parties shall negotiate in good faith to modify this Agreement so as to effect the original intent of the parties to the fullest extent possible.

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

6.06 Captions. The captions used in this Agreement and the Disclosure Letter are for convenience of reference only and do not constitute a part of this Agreement or a part of the Disclosure Letter and shall not be deemed to limit, characterize, or in any way affect any provision of this Agreement or the Disclosure Letter, and all provisions of this Agreement and the Disclosure Letter shall be enforced and construed as if no captions had been used therein.

6.07 Complete Agreement. This Agreement (including the Disclosure Letter and all other Exhibits and Schedules hereto), the other Transaction Documents, and the Confidentiality Agreement constitute the entire agreement among the parties with respect to the subject matter of this Agreement and thereof and supersede all prior (but not concurrent) agreements and undertakings, both written and oral, among the parties, or any of them, with respect to the subject matter hereof and thereof.

6.08 Disclosure Letter. Any fact or item that is disclosed in any specific section of the Disclosure Letter in a way as to make its relevance or applicability to information called for by any other section of the Disclosure Letter reasonably apparent on its face shall be deemed to be disclosed in such other specific section of the Disclosure Letter, notwithstanding the omission of a reference or cross-reference thereto.

6.09 Counterparts. This Agreement may be executed and delivered in one or more counterparts, either manually or electronically (including by PDF and electronic mail), each of which shall be deemed to be an original but all of which together shall constitute one and the same agreement. No counterpart shall be effective unless and until each party has executed at least one counterpart.

6.10 Specific Performance. The parties hereto agree that irreparable damage would occur in the event that any of the provisions of this Agreement were not performed by Buyer or Seller, as applicable, in accordance with their specific terms or were otherwise breached by Buyer or Seller, as applicable. It is accordingly agreed that the parties shall be entitled to an injunction or injunctions, without any requirement to post or provide any bond or other security in connection therewith, to prevent breaches of this Agreement by Buyer or Seller, as applicable, and to enforce specifically the terms and provisions of this Agreement against Buyer or Seller, as applicable, in any court having jurisdiction, this being in addition to any other remedy to which the parties hereto are entitled at law or in equity.

6.11 Governing Law; Jurisdiction; Waiver of Jury Trial. This Agreement shall be governed by, and construed in accordance with, the laws of the State of Delaware, without giving effect to any choice or conflict of law, provision, or rule that would cause the application of laws of any other jurisdiction. In any action among or between any of the parties arising out of or relating to this Agreement, including any action seeking equitable relief, each of the parties irrevocably and unconditionally consents and submits to the exclusive jurisdiction and venue of the state and federal courts located in Wilmington, Delaware. Each party hereby irrevocably waives all right to trial by jury in any legal proceeding (whether based on Contract, tort, or otherwise) arising out of or relating to this Agreement and the other Transaction Documents, the transactions contemplated hereby or thereby, or the actions of such parties in the negotiation, administration, performance, and enforcement hereof and thereof.

6.12 Interpretation. Any reference to any federal, state, local, or foreign statute or applicable Law shall be deemed also to refer to all rules and regulations promulgated thereunder, unless the context requires otherwise. The word “including” shall mean including without limitation. The word “or” is disjunctive, but not necessarily exclusive. The words “hereof,” “herein,” “hereunder,” and similar terms in this Agreement refer to this Agreement as a whole, including Exhibits and Schedules hereto, and not to any particular provision of this Agreement. When a reference is made in this Agreement to Annexes, Articles, Exhibits, Sections or Schedules, such reference shall be to an Annex, Article, Exhibit, Section or Schedule to this Agreement unless otherwise indicated. For purposes of Article II, the words “provide,” “deliver,” “make available,” “furnish,” and similar terms in this Agreement shall mean provide in that certain virtual data room titled “Perfect Audience Due Diligence” on Google Drive at least one Business Day prior to the date of this Agreement. Pronouns in the masculine, feminine, and neuter genders shall be construed to include any other gender, and words in the singular form shall be construed to include the plural and vice versa, unless the context otherwise requires. If any party has breached any representation, warranty, or covenant contained herein in any respect, the fact that there exists another representation, warranty, or covenant relating to the same subject matter (regardless of the relative levels of specificity) that the party has not breached shall not detract from or mitigate the fact that the party is in breach of the first representation, warranty, or covenant. All accounting terms used herein and not expressly defined herein shall, except as otherwise noted, have the meanings assigned to such terms in accordance with GAAP. References to clauses without a cross-reference to a Section or subsection are references to clauses with the same Section or, if more specific, subsection. The symbol “$” refers to United States Dollars. All references to “days” shall be to calendar days unless otherwise indicated as a “Business Day.” Any action otherwise required to be taken on a day that is not a Business Day shall instead be taken on the next succeeding Business Day, and if the last day of such period is a non-Business Day, the period in question shall end on the next succeeding Business Day. Unless indicated otherwise, all mathematical calculations contemplated by this Agreement shall be rounded to the tenth decimal place, except in respect of payments, which shall be rounded to the nearest whole United States cent.

* * * * * *

IN WITNESS WHEREOF, the parties hereto have executed this Asset Purchase Agreement on the date first written above.


BUYER:

SHARPSPRING, INC.

By:		/s/ Rick Carlson
		Name: Rick Carlson
		Its: Chief Executive Officer

[Signature Page to Asset Purchase Agreement]

IN WITNESS WHEREOF, the parties hereto have executed this Asset Purchase Agreement on the date first written above.


SELLER:

MARIN SOFTWARE INCORPORATED

By:		/s/ Christopher Lien
		Name: Christopher Lien
		Its: Chief Executive Officer

[Signature Page to Asset Purchase Agreement]

Annex A

In this Agreement, the following terms have the meanings set forth below:

“Action” means any claim, action, suit, audit, assessment, arbitration, proceeding, or investigation by or before any mediator, arbitrator, or Governmental Entity.

“Accounts Receivable” shall have the meaning set forth in Section 1.01(a)(viii).

“Accrued and Unpaid Bonus Amount” means the aggregate amount of bonuses payable to the Transferred Employee that are unpaid as of the Closing Date.

“Affiliate” means, with respect to any Person, any Person that directly, or indirectly through one or more intermediaries, Controls or is Controlled by or is under common Control with such Person.

“Agreement” shall have the meaning set forth in the Preamble.

“Allocation Methodology” shall have the meaning set forth in Section 1.02(c).

“Allocation Schedule” shall have the meaning set forth in Section 1.02(c).

“Assignment and Assumption Agreement” shall have the meaning set forth in Section 1.01(a).

“Assumed Employee Liabilities” shall have the meaning set forth in Section 4.03(i).

“Assumed Liabilities” shall have the meaning set forth in Section 1.01(c).

“Books and Records” shall have the meaning set forth in Section 1.01(a)(vi).

“Business” means the business unit of Seller providing SMB-focused display retargeting software products and services under the “Perfect Audience” brand name as conducted as of the Closing Date, which for the avoidance of doubt excludes all other businesses of Seller.

“Business Contractor” shall have the meaning set forth in Section 2.13(k).

“Business Day” means any day, other than a Saturday, Sunday, or any other day on which banks located in San Francisco, California are authorized or required to be closed for business.

“Business Employee” shall have the meaning set forth in Section 2.13(k).

“Business Financial Information” shall have the meaning set forth in Section 2.04.

“Business IT Systems” means the IT Systems included in the Purchased Assets.

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“Business Registered IP” shall have the meaning set forth in Section 2.14(a).

“Business Services” means the SMB-focused display retargeting software products and services offered by Seller under the “Perfect Audience” brand name as of the Closing, which excludes all other products and services offered by Seller.

“Buyer” shall have the meaning set forth in the Preamble.

“Buyer 401(k) Plan” shall have the meaning set forth in Section 4.03(e).

“Buyer Indemnified Parties” shall have the meaning set forth in Section 5.02.

“Buyer Material Adverse Effect” means any change, effect, event, occurrence, impact, or development (each an “Effect”) that has had or would reasonably be expected to have a material and adverse effect on the ability of Buyer to consummate the purchase and sale of the Purchased Assets and the assumption of the Assumed Liabilities.

“Closing” shall have the meaning set forth in Section 1.02(c).

“Closing Accrued Publisher Cost Amount” shall mean the aggregate amount of accrued Publisher Costs of Seller as of the Closing to the extent exclusively relating to the Business.

“Closing Cash Purchase Price” shall have the meaning set forth in Section 1.02(b).

“Closing Date” shall have the meaning set forth in Section 1.02(c).

“Closing Pre-Paid Customer Cash Amount” shall mean the aggregate amount of prepaid customer cash advances or deposits held by Seller as of the Closing to the extent exclusively relating to the Business.

“Closing Statement” shall have the meaning set forth in Section 1.02(b).

“COBRA” means the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended.

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

“Computer Software” means all computer software (including source and object code), owned or licensed, whether for general business usage or specific, unique-to-the-business usage, all computer operating security or programming software, and all documentation relating to any of the foregoing.

“Confidentiality Agreement” means the Nondisclosure Agreement between Buyer and Seller dated June 19, 2019.

“Contingent Asset” shall have the meaning set forth in Section 1.01(e).

“Contract” means any agreement, arrangement, bond, commitment, contract, indenture, instrument, lease, or license, whether written or oral.

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“Control” means, with respect to any Person, the power to direct the management and policies of such Person, directly or indirectly, whether through the ownership of voting securities, by Contract, or otherwise and the term “Controlled” has a meaning correlative with the foregoing.

“Copyright” means registered copyrights, copyright applications, mask works and unregistered copyrights.

“Covered Representations” means the representations and warranties in Section 2.08 (Title to Properties), Section 2.13(a) (Intellectual Property) and Section 2.17 (Sufficiency of Assets).

“Data Protection Laws” means all applicable Laws concerning or otherwise relating to the processing of Personal Data, including Regulation (EU) 2016/679 of the European Parliament and of the Council of 27 April 2016 on the protection of natural persons with regard to the processing of personal data and on the free movement of such data (known as the General Data Protection Regulation (“GDPR”)), the Privacy and Electronic Communications Directive 2002/58/EC (as may be superseded by the Privacy and Electronic Communications Regulation) and the Data Protection Act 2018.

“Deductible” shall have the meaning set forth in Section 5.04(c).

“Disclosure Letter” has the meaning set forth in Article II.

“Domain Maintenance Agent” shall have the meaning set forth in Section 4.12(c).

“Domain Maintenance Agreement” shall have the meaning set forth in Section 4.12(c).

“Employee Sharing Agreement” shall have the meaning set forth in Section 1.03(c)(iv).

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

“ERISA Affiliate” means any corporation or trade or business (whether or not incorporated) which is treated with Seller as a single employer within the meaning of Section 414 of the Code.

“Exchange Act” means the Securities Exchange Act of 1934, as amended, or any successor statute, and the rules and regulations promulgated thereunder.

“Excluded Assets” shall have the meaning set forth in Section 1.01(b).

“Excluded Employee Liabilities” has the meaning set forth in Section 4.03(h).

“Excluded Liabilities” shall have the meaning set forth in Section 1.01(d).

“Excluded Taxes” means (i) all income Taxes and other Taxes of Seller or of any other Person for which Seller is liable (except for non-income Taxes arising from or with respect to the Purchased Assets or the operations of the Business), (ii) all Taxes arising from or with respect to the Purchased Assets or the operation of the Business, in each case that are incurred in or attributable to any taxable period or portion thereof ending before the Closing Date; and (iii) the portion of Transfer Taxes for which the Seller is liable under Section 4.08.

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“Final Allocation” shall have the meaning set forth in Section 1.02(c).

“Fraud” means any (i) actual fraud committed with the intent to deceive, (ii) intentional or willful misrepresentation, or (iii) willful or criminal misconduct, in each case, committed by or on behalf of a party to this Agreement.

“GAAP” means United States generally accepted accounting principles, as consistently applied by Seller.

“Governmental Entity” means any directly or indirectly government-owned or controlled entity, including a government, governmental agency, department, bureau, office, commission, authority, or instrumentality, court of competent jurisdiction, self-regulatory organization or any stock exchange on which a party’s securities are listed, in each case whether foreign, federal, national, state, municipal, provincial or local.

“Indebtedness” means, without duplication, (i) any obligations for borrowed money, and (ii) any obligations evidenced by any note, bond, or debenture, together in each case with accrued and unpaid interest thereon, and any premiums, fees, expenses and other amounts due in connection therewith.

“Indemnified Party” shall have the meaning set forth in Section 5.05(a).

“Indemnifying Party” shall have the meaning set forth in Section 5.05(a).

“Intellectual Property” means, collectively, (i) all inventions (whether patentable or unpatentable and whether or not reduced to practice), all improvements thereto, and all Patents, (ii) all Trademarks, fictitious names, brand names, brand marks, and corporate names, together with all translations, adaptations, derivations, and combinations thereof, and all applications, registrations, and renewals in connection therewith, (iii) all Internet domain names, (iv) all copyrightable works, all Copyrights, and all applications, registrations, and renewals in connection therewith; (v) all trade secrets and confidential business information (including ideas, research and development, know-how, technical data, designs, drawings, specifications, customer and supplier lists), (vi) rights in all Computer Software, (vii) rights in all data and databases (but excluding rights in Personal Data), (viii) all other intellectual property rights of any kind, and (ix) goodwill associated with any of the foregoing.

“IT Systems” means information technology and computer systems (including software, servers, workstations, routers, hubs, switches, circuits, networks, data communications lines) relating to the transmission, storage, maintenance, organization, presentation, generation, processing or analysis of data and information, whether or not in electronic format.

“Knowledge of Seller” means the actual knowledge of Chris Lien, Brad Kinnish and Wister Walcott, or knowledge such person would have had, after having conducted reasonable review of the Books and Records and reasonable inquiry of those employees, consultants, and advisors of Seller who report to such Persons.

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“Law” means any statute, law (including common law), ordinance, rule, regulation, or treaty of any Governmental Entity, in each case to the extent enacted prior to the Closing Date and as in effect on the Closing Date.

“Liability” means any debt, Contract, liability, or obligation of any type or nature, and whether accrued or unaccrued, known or unknown, absolute, contingent, liquidated or unliquidated, or otherwise.

“Liens” means any claim, charge, covenant, easement, encumbrance, pledge, security interest, lien, mortgage, deed of trust, or other restriction on title or transfer.

“Loss” means any loss, Liability, penalty, assessment, levy, fine, award, judgment, settlement, Tax, damage, claim, cost, fee, or expense (including reasonable and documented attorneys’, accountants’ and experts’ fees and disbursements incurred in connection with the defense of any Action).

“Material Adverse Effect” means any Effect that has had or would reasonably be expected to have a material and adverse effect on the operations, assets, liabilities, employees, or financial condition or results of operations of the Business, taken as a whole; provided, that none of the following shall be deemed in themselves, either alone or in combination, to constitute, and none of the following shall be taken into account in determining whether there has been, a Material Adverse Effect: (i) Effects arising from or relating to general business or economic conditions, whether or not affecting the industries in which the Business operates (to the extent that the Business and the Purchased Assets are not disproportionately affected thereby relative to other similar businesses in the same industry); (ii) Effects arising from or relating to national or international political or social conditions, including the engagement by the United States or any other country in hostilities, or the escalation thereof, and the occurrence of any military or terrorist attack on the United States or any other country; (iii) Effects arising from or relating to any changes in financial, banking, securities, or commodities markets, including any disruptions thereof and any changes in any prices therein (to the extent that the Business and the Purchased Assets are not disproportionately affected thereby relative to other similar businesses in the same industry); (iv) changes in, or changes in interpretations of, GAAP or other applicable accounting rules, regulations, or pronouncements, and any Effects arising therefrom or related thereto (to the extent that the Business and the Purchased Assets are not disproportionately affected thereby relative to other similar businesses in the same industry); and (v) changes in, or changes in interpretations of, Law, and any Effects arising therefrom or related thereto (to the extent that the Business and the Purchased Assets are not disproportionately affected thereby relative to other similar businesses in the same industry); (vi) the announcement or pendency of the transactions contemplated herein, and any Effects arising therefrom or related thereto; (vii) any action taken or omitted to be taken in compliance with this Agreement by any Person, and any Effects arising therefrom or related thereto; (viii) Effects arising from or relating to any existing change, event, occurrence, or development of which Buyer has knowledge as of the date of this Agreement (including any matter set forth in the Disclosure Letter); and (ix) Effects arising from or relating to any violation or breach by Buyer of any representation, warranty, contained in this Agreement.

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“Material Customer” shall have the meaning set forth in Section 2.20.

“Material Security Breach” shall have the meaning set forth in Section 2.14(k).

“Material Vendor” shall have the meaning set forth in Section 2.21.

“New Plans” shall have the meaning set forth in Section 4.03(c).

“Open Source Software” shall have the meaning set forth in Section 2.14(k).

“Order” means any judgment, order, injunction, decree, or writ of any Governmental Entity.

“Organizational Documents” means, for any Person, the certificate of incorporation and by-laws of such Person, or the equivalent constituent documents with respect to Persons that are not corporations.

“Overhead and Shared Services” means the following ancillary or corporate shared services that are provided to both (i) the Business and (ii) other businesses of Seller and its Subsidiaries and Affiliates (as applicable): finance support, travel and entertainment services, temporary labor services, office supplies services (including copiers and faxes), personal telecommunications services, computer/telecommunications maintenance and support services, application support and services, energy/utilities services, procurement and supply chain services and arrangements, treasury services, public relations, legal and risk management services (including workers’ compensation), payroll services, telephone/online connectivity services, accounting services, tax services, internal audit services, executive management services, investor relations services, human resources and employee relations management services, employee benefits services, credit, collections and accounts payable services, property management services, environmental support services and customs and excise services. Overhead and Shared Services shall not include any item in the previous sentence (i) that is exclusive to the Business, rather than shared with any other line of business or the general operations of Seller, or (ii) to the extent provided solely by using Transferred Employees and/or Purchased Assets.

“Patents” means all letters patent and pending applications for patents of the United States and all countries foreign thereto, including regional patents, certificates of invention and utility models, rights of license or otherwise to or under letters patent, certificates of intention and utility models which have been opened for public inspection and all reissues, reexaminations, divisions, continuations and extensions thereof.

“Permit” means, with respect to any Person, any license, permit, authorization, approval, certificate of authority, registration, qualification, easement, rights of way, or similar consent or certificate granted or issued to such Person.

“Permitted Liens” means, (i) Liens for Taxes, assessments or governmental charges or levies not yet due and payable or that are being contested in good faith and by appropriate proceedings, in either case for which adequate reserves have been taken, (ii) mechanics, carriers’, workmen’s, repairmen’s, materialmen’s or other Liens for labor, materials or supplies that secure amounts not yet due and payable or that are being contested in good faith and by appropriate proceedings, (iii) pledges or deposits to secure obligations under workers’ compensation or other similar Laws or to secure public or statutory obligations, (iv) pledges and deposits to secure the performance of bids, trade Contracts, leases, surety and appeal bonds, performance bonds, and other similar obligations and (v) non-exclusive licenses of Intellectual Property in the ordinary course.

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“Person” means any individual, partnership, limited liability company, corporation, association, joint stock company, trust, joint venture, unincorporated organization, or Governmental Entity.

“Personal Data” has the meaning used in the applicable Laws, including any data that allows the identification of a natural person, such as, to the extent applicable, a natural person’s name, street address, telephone number, e-mail address, photograph, social security number or tax identification number, driver’s license number, passport number, credit card number, bank account information and other financial information, customer or account numbers, account access codes and passwords.

“Plans” means each “employee benefit plan,” as defined in Section 3(3) of ERISA, and all other pension, retirement, supplemental retirement, deferred compensation, excess benefit, profit sharing, bonus, incentive, stock purchase, stock ownership, stock option, stock appreciation right, profits interest, equity derivative or other equity, phantom equity, employment, severance, salary continuation, termination, change-of-control, health, life, disability, group insurance, vacation, holiday and fringe benefit plan, program, policy, practice, Contract, or arrangement, in each case maintained, contributed to, or required to be contributed to, by Seller or any ERISA Affiliate for the benefit of any Business Employee or Business Contractor.

“Post-Closing Tax Period” shall have the meaning set forth in Section 4.02(a).

“Pre-Closing Tax Period” shall have the meaning set forth in Section 4.02(a).

“Prepaid AWS Licenses” means amounts paid by Seller on or prior to 12:01 am on the Closing Date in respect of Amazon Web Services licenses to the extent used in the Business after 12:01 am on the Closing Date.

“Publisher Costs” means those Business advertising inventory costs that result from a customer delivering an advertising impression.

“Purchase Price” shall have the meaning set forth in Section 1.02(a).

“Purchased Assets” shall have the meaning set forth in Section 1.01(a).

“Purchased Books and Records” shall have the meaning set forth in Section 1.01(a)(vi).

“Purchased Contracts” shall have the meaning set forth in Section 1.01(a)(iv).

“Purchased Software” shall have the meaning set forth in Section 1.01(a)(ii).

“Registered Intellectual Property” means all Patents, Trademarks, Copyrights and Internet domain names registered or applied-for.

“Restricted Period” shall have the meaning set forth in Section 4.11(a).

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“Retained Plans” shall have the meaning set forth in Section 4.03(b).

“Retained IP” shall have the meaning set forth in Section 2.14(a).

“Retained IP License Agreement” shall have the meaning set forth in Section 1.03(c)(iii).

“Seller” shall have the meaning set forth in the Preamble.

“Seller 401(k) Plan” shall have the meaning set forth in Section 4.03(e).

“Seller Indemnified Parties” shall have the meaning set forth in Section 5.03.

“Seller Trademarks” has the meaning set forth in Section 4.10.

“Straddle Period” has the meaning set forth in Section 4.02(a).

“Subsidiary” means, with respect to any Person, any partnership, limited liability company, corporation, association, joint stock company, trust, joint venture, or unincorporated organization of which (i) if a corporation, a majority of the total voting power of shares of capital stock entitled (without regard to the occurrence of any contingency) to vote in the election of directors, managers, or trustees thereof is at the time owned or controlled, directly or indirectly, by that Person or one or more of the other Subsidiaries of that Person or a combination thereof, or (ii) if a business entity other than a corporation, a majority of the partnership or other similar ownership interests thereof is at the time owned or controlled, directly or indirectly, by that Person or one or more Subsidiaries of that Person or a combination thereof. For purposes hereof, a Person or Persons shall be deemed to have a majority ownership interest in a business entity other than a corporation if such Person or Persons shall be allocated a majority of gains or losses or shall be or control the general partner or other managing Person of such business entity.

“Taxes” means any U.S., federal, state, local, foreign or other income, gross receipts, license, payroll, employment, excise, severance, stamp, occupation, premium or windfall profits taxes, environmental taxes, customs duties, franchise, employees’ income withholding, foreign or domestic withholding, social security, unemployment, disability, real property, personal property, unclaimed property, escheat, sales, use, transfer, value added, goods and services, alternative or add-on minimum or other tax, fee, assessment or charge of any kind whatsoever, whether computed on a separate or consolidated, unitary or combined basis or in any other manner, including any interest, penalties or additions to Tax or additional amounts in respect of the foregoing, in each case whether disputed or not and including any obligation to indemnify or otherwise assume or succeed to the Tax liability of any other Person.

“Tax Return” means any return, declaration, report, claim for refund, or information return or statement relating to Taxes filed or required to be filed with a tax authority, including any schedule, attachment or supplement thereto, and including any amendment thereof.

“Third Party” means any Person other than (i) Buyer, (ii) Seller and (iii) an Affiliate of Buyer or Seller.

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“Third Party IP” shall have the meaning set forth in Section 2.12(a)(vii).

“Third-Party Claim” shall have the meaning set forth in Section 5.05(a).

“Trademarks” means registered and unregistered trademarks and service marks, trademark and service mark applications, logos, trade names, and trade dress.

“Transaction Documents” shall have the meaning set forth in Section 1.01(a).

“Transaction Expenses” means (i) the fees and expenses of Seller incurred in connection with the transactions contemplated hereby and (ii) the amount of severance or sale, change in control or similar bonuses payable to any Business Employee or Business Contractor that become payable prior to or as a result of the transactions contemplated hereby, and the employer portion of any payroll or employment Taxes incurred in connection with such amounts.

“Transferred Customers” means those customers of the Business as of the Closing represented by Purchased Contracts.

“Transferred Data” shall have the meaning set forth in Section 1.01(a)(iii).

“Transferred Employee” shall have the meaning set forth in Section 4.03(a).

“Unbilled Accounts Receivable” means any Accounts Receivable arising from Business Services provided prior to the Closing Date for which an invoice has not been issued by Seller as of 12:01 am on the Closing Date.

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Exhibit 99.2

SharpSpring Appoints Michael Power as New Chief Financial Officer

GAINESVILLE, FL – November 21, 2019 – SharpSpring, Inc. (NASDAQ: SHSP), a leading cloud-based marketing automation platform, announced today that Brad Stanczak will step down from his position as Chief Financial Officer (CFO) of the Company, effective December 2, 2019, and will be replaced by Michael Power. Stanczak will remain employed by the Company and support the transition through the remainder of the year at a minimum.

Stanczak’s departure is driven by his need to attend to certain family matters that require attention outside of SharpSpring. Further, his departure is not the result of any disagreement with the Company nor any issue related to the Company’s financial statements or accounting practices.

Power comes to SharpSpring with over three decades of finance and accounting experience in various leadership roles. Prior to his appointment, Power was Executive Vice President, Chief Financial Officer and Treasurer for ConnectWise, an IT management and Software-as-a-Service (SaaS) company with more than 1,000 employees, which was acquired earlier this year by Thoma Bravo. Terms of the ConnectWise deal were not disclosed but it has been reported at approximately $1.5 billion. Prior to that, Power served as Vice President and Controller for CHUBB, formerly ACE Limited.

Power holds an active CPA in the state of Pennsylvania, CGMA from the American Institute of CPAs, and obtained a Bachelor of Science in Accountancy from Villanova University.

“On behalf of the entire SharpSpring team, I want to thank Brad for his commitment and service to our organization,” said SharpSpring CEO Rick Carlson. “In his time as CFO, Brad was instrumental in improving our financial controls and processes as well as driving our ongoing maturation as a public company built for scale. His impact will remain long after his time here. We wish him well with his family considerations, and with all of his future pursuits.”

Carlson continued: “We’re also very fortunate to have someone like Michael Power stepping into the CFO role. He is an experienced finance veteran and very well-versed in the SaaS industry, having previously come from a 1,000-person team and leading a successful acquisition of ConnectWise. We expect to benefit greatly from his talents, and we’re looking forward to bringing him on board.”

Mr. Power’s employment agreement is contingent upon completion of usual and customary background checks.

About SharpSpring, Inc.

SharpSpring, Inc. (NASDAQ: SHSP) is a rapidly growing, highly-rated global provider of affordable marketing automation delivered via a cloud-based Software-as-a Service (SaaS) platform. Thousands of businesses around the world rely on SharpSpring to generate leads, improve conversions to sales, and drive higher returns on marketing investments. Known for its innovation, open architecture and free customer support, SharpSpring offers flexible monthly contracts at a fraction of the price of competitors, making it an easy choice for growing businesses and digital marketing agencies. Learn more at https://www.sharpspring.com/.

Company Contact:

Brad Stanczak

Chief Financial Officer

Phone: 352-448-0967

Email: IR@sharpspring.com

Investor Relations:

Gateway Investor Relations

Matt Glover or Tom Colton

Phone: 949-574-3860

Email: SHSP@gatewayir.com

Exhibit 99.3

SharpSpring Announces Acquisition of Perfect Audience from Marin Software

Combines Powerful SMB-focused Digital Ad Platform with Marketing Automation for First-of-its-kind Product Offering

GAINESVILLE, FL – November 21, 2019 – SharpSpring, Inc. (NASDAQ: SHSP), a leading cloud-based marketing automation platform for digital marketing agencies, today announced it has acquired the digital advertising platform Perfect Audience from Marin Software (NASDAQ: MRIN), for a net cash consideration of $4.6 million. The acquisition introduces an entirely new suite of tools and revenue stream for SharpSpring agency partners.

About Perfect Audience

The Perfect Audience cloud-based platform enables multi-channel retargeting to known leads, plus targeted advertising to new prospects via lookalike audience functionality. It empowers marketers to create, manage, and optimize their ad campaigns across thousands of sites using Google, Facebook, Instagram, leading ad exchanges and partner networks – all within one, simple-to-use interface.

“This new offering pairs perfectly with SharpSpring’s brand promise to help our agency partners grow their businesses and deliver better results to their clients,” said Rick Carlson, SharpSpring founder and CEO. “We believe nearly every business should be leveraging retargeting because it enhances the effectiveness of all their other marketing efforts, so we’re excited to put this affordable, intuitive solution into the hands of our agency partners and their clients.”

Ads placed via the platform can be seamlessly dispersed and measured across every major advertising network, including Google, Facebook, Yahoo!, AppNexus, Rubicon, and Smaato, providing all the tools marketers need to drive incremental leads and sales, while easily tracking the ROI of their ad spend. With multiple ad networks at their disposal, users can select the best channels for their purpose, ensuring cost effective results in nearly any situation.

Product Synergies

SharpSpring’s user base of digital marketing agencies and their clients offers an exciting strategic fit with the SMB-focused Perfect Audience platform.

Perfect Audience adds powerful lead functionality that fuels top-of-the-funnel lead generation efforts, plus additional lead nurturing capabilities to maximize middle-of-the-funnel conversion. These features complement SharpSpring’s core feature set designed to track, nurture, and convert those leads into sales.

This acquisition provides another competitive differentiator between SharpSpring and other marketing automation providers like Hubspot, Pardot, and Marketo, and further separates SharpSpring from more basic email service providers (ESPs) like Constant Contact, iContact, and MailChimp.

Financing Round

SharpSpring also announced that it has entered into definitive agreements to sell 555,556 shares of its common stock in a private placement to funds managed by Greenhaven Road Investment Management, L.P. and other institutional stockholders of the company for an aggregate purchase price of $5 million. SharpSpring anticipates that it will complete the financing transaction no later than Friday, November 22, 2019, subject to satisfaction of customary closing conditions. Assuming the completion of the financing, SharpSpring’s net cash position will be largely unaffected by the Perfect Audience acquisition.

Go-Forward Strategy

Beyond the company’s plans to cross-sell to both SharpSpring and Perfect Audience customers, there are powerful product enhancements on the horizon.

“In the short term, we’re focused on adding single sign-on and unified billing between SharpSpring and Perfect Audience, which will provide a seamless experience to our agency partners and their clients,” said Carlson. “In Q1, we’re intending to add automatic campaign attribution and other integrated marketing automation features that are only possible with this combined product offering.”

Also notable, the acquisition allows SharpSpring to become an official Facebook Marketing Partner, in turn allowing the company to pursue adding Instagram to its existing social media management tool, which will fulfill a popular customer request.

To learn more, visit investors.sharpspring.com.

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About SharpSpring, Inc.

SharpSpring, Inc. (NASDAQ: SHSP) is a rapidly growing, highly-rated global provider of affordable marketing automation delivered via a cloud-based Software-as-a Service (SaaS) Platform. Thousands of businesses around the world rely on SharpSpring to generate leads, improve conversions to sales, and drive higher returns on marketing investments. Known for its innovation, open architecture and free customer support, SharpSpring offers flexible monthly contracts at a fraction of the price of competitors, making it an easy choice for growing businesses and digital marketing agencies. Learn more at sharpspring.com.

Important Cautions Regarding Forward-Looking Statements

The information posted in this release, including, without limitation, the information included under the headings “Financing Round” and “Go-Forward Strategy,” may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. You can identify these statements by use of the words “may,” “will,” “should,” “plans,” “explores,” “expects,” “anticipates,” “continues,” “estimates,” “projects,” “intends,” and similar expressions. Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are based only on our current beliefs, expectations and assumptions regarding the future of our business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our control. Our actual results and financial condition may differ materially from those indicated in the forward-looking statements. Therefore, you should not rely on any of these forward-looking statements. Important factors that could cause our actual results and financial condition to differ materially from those indicated in the forward-looking statements include, but are not limited to, delays in the closing of, or the failure to close, the financing transaction described herein, general economic and business conditions, effects of continued geopolitical unrest and regional conflicts, competition, changes in technology and methods of marketing, delays in completing new customer offerings, changes in customer order patterns, changes in customer offering mix, continued success in technological advances and delivering technological innovations, our ability to successfully utilize our cash to develop current and future products, delays due to issues with outsourced service providers, those events and factors described by us in Item 1. A “Risk Factors” in our most recent Form 10-K and other risks to which our company is subject, and various other factors beyond the company’s control. Any forward-looking statement made by us in this press release is based only on information currently available to us and speaks only as of the date on which it is made. We undertake no obligation to publicly update any forward-looking statement, whether written or oral, that may be made from time to time, whether as a result of new information, future developments or otherwise.

Company Contact:

Brad Stanczak

Chief Financial Officer

Phone: 352-448-0967

Email: IR@sharpspring.com

Investor Relations:

Gateway Investor Relations

Matt Glover or Tom Colton

Phone: 949-574-3860

Email: SHSP@gatewayir.com