OMNIQ Corp 8-K, filed Jul 16, 2025
OMNIQ Corp. (OMQS)
About this 8-K
OMNIQ Corp filed this 8-K on July 16, 2025, reporting on events of July 11, 2025.
Items reported
- Item 1.01: Entered into a material agreement
- Item 2.01: Completed an acquisition or sale of assets
- Item 2.03: New debt or off-balance-sheet obligation
- Item 7.01: Regulation FD disclosure
- Item 9.01: Financial statements and exhibits
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
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Item 1.01. Entry into a Material Definitive Agreement.
On July 11, 2025, OmniQ Corp., a Delaware corporation (the “Company”), together with its subsidiaries, Quest Marketing, Inc., HTS Image Processing, Inc., OmniQ Vision Inc., HTS Image Ltd., OmniQ Technologies Ltd., and Dangot Computers, Ltd. (collectively, the “Sellers”), entered into an Asset Purchase Agreement (the “Purchase Agreement”) with Summit Junction Holdings LLC, a Delaware limited liability company (the “Buyer”).
Pursuant to the Purchase Agreement, the Sellers agreed to sell, and Buyer agreed to purchase, substantially all of the assets and assume certain liabilities mainly associated with the Company’s legacy business line, including its integrated hardware, software, and automation solutions business, (the “Transferred Business”). The Transaction was consummated on July 11, 2025. Although the Purchase Agreement is dated as of June 30, 2025, the parties executed the agreement and consummated the Transaction on July 11, 2025.
The aggregate consideration for the Transaction is approximately $45.0 million, consisting of the assumption by Buyer of up to $55.0 million in specified liabilities of the Transferred Business and the issuance by the Company of a Promissory Note in the principal amount of $10.0 million in favor of the Buyer. The Promissory Note bears interest at 5% per annum, is amortized over a ten-year period, and provides for a balloon payment after the third year. In addition, the Company is entitled to a contingent payment of up to $10.0 million in the event that, within 18 months following the closing, Buyer either (i) consummates a sale of all or substantially all of its assets or equity for consideration in excess of $100.0 million or (ii) completes an initial public offering at a valuation exceeding $100.0 million.
The assets sold include, among other things, accounts receivable, inventory, tangible personal property, intellectual property, contract rights, books and records, and other assets used or held for use in connection with the Transferred Business. Certain assets were excluded from the Transaction, including the Company’s cash and cash equivalents and all assets not related to the Transferred Business. Buyer assumed only those liabilities specified in the Purchase Agreement, and the Company retained all other liabilities, including those unrelated to the Transferred Business or expressly excluded.
The Purchase Agreement contains customary representations, warranties, and covenants, including pre-closing operating covenants, post-closing indemnification provisions, and certain limitations on liability. The Transaction and Purchase Agreement were approved by the Company’s Board of Directors effective June 30, 2025 following completion of a fairness opinion, dated June 27, 2025, from an independent financial advisor.
In connection with the closing, the Company and Buyer entered into and delivered various ancillary agreements, including a Bill of Sale, Assignment and Assumption Agreement, Trademark Assignment Agreement, Promissory Note, Intellectual Property License Agreement, and Transition Services Agreement. The Company also entered into a consent agreement with its largest vendor Bluestar to consent to the transfer of the liabilities owed to it from the Company to the Buyer. An entity affiliated with Shai Lustgarten, the Company’s CEO is the principal member of the Buyer. In addition, an entity affiliated with Jason Griffith, a consultant to the Company, is a minority member of the Buying entity.
The Company entered into a conversion agreement with Shai Lustgarten, the Company’s Chief Executive Officer, of the Company, pursuant to which he converted $31,500 in outstanding payables owed to him into 450,000 shares of common stock of the Company based on a price of $0.07 per share which was a slight premium to the market price on July 10, 2025.
The foregoing summary of the Purchase Agreement and the related agreements does not purport to be complete and is qualified in its entirety by reference to the full text of such agreements, copies of which are filed as exhibits to this Current Report on Form 8-K and are incorporated herein by reference. The inclusion of such agreements is not intended to provide any other factual information about the Company or the other parties thereto.
Item 2.01. Completion of Acquisition or Disposition of Assets.
The information set forth under Item 1.01 of this Current Report on Form 8-K is incorporated herein by reference. On July 11, 2025, the Company completed the sale of substantially all of the assets and the assignment of certain specified liabilities related to the Transferred Business to Buyer in accordance with the terms of the Purchase Agreement.
Item 2.03 Creation of a Direct Financial Obligation of a Registrant
The information set forth under Item 1.01 is incorporated herein by reference. On July 11, 2025, the Company issued the Promissory Note to Buyer in accordance with the terms of the Purchase Agreement.
Item 7.01. Regulation FD Disclosure.
On July 16, 2025, the Company issued a press release announcing the closing of the Transaction described in Items 1.01 and 2.01 of this Current Report on Form 8-K. A copy of the press release is furnished as Exhibit 99.1 to this report and is incorporated herein by reference.
The information contained in this Item 7.01 and Exhibit 99.1 attached hereto shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, nor shall it be deemed incorporated by reference in any filing with the Securities and Exchange Commission made by the Company, whether made before or after the date hereof, regardless of any general incorporation language in such filing.
Item 9.01. Financial Statements and Exhibits.
| (a) | Financial Statements of Businesses Acquired. Not applicable. |
| (b) | Pro Forma Financial Information. The Company will file any required pro forma financial information by amendment to this Current Report on Form 8-K within the period prescribed by applicable rules. |
| (c) | Exhibits. The following exhibits are filed with this Current Report on Form 8-K: |
| Exhibit No. |
Description | |
| 10.1 | Asset Purchase Agreement, dated June 30, 2025, by and among OmniQ Corp., its subsidiaries, and Summit Junction Holdings LLC | |
| 10.2 | Promissory Note, dated June 30, 2025, issued by OmniQ Corp in favor of Summit Junction Holdings LLC | |
| 10.6 | Transition Services Agreement, dated June 30, 2025 | |
| 10.10 | Shai Lustgarten Conversion Agreement, dated July 10, 2025 | |
| 99.1 | Proforma Financial Statements for the year ended December 31, 2024 and for the three months ending March 31, 2025 | |
| 99.2 | Press Release, dated July 16, 2025 | |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
Certain schedules and exhibits to the agreements listed above have been omitted pursuant to Item 601(a)(5) of Regulation S-K. The Company agrees to furnish supplementally a copy of any omitted schedule or exhibit to the Securities and Exchange Commission upon request.
SIGNATURE
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.
| OMNIQ CORP. | ||
| Date: July 16, 2025 | By: | /s/ Shai S. Lustgarten |
| Shai S. Lustgarten | ||
| President and Chief Executive Officer | ||
Exhibit 10.1
ASSET PURCHASE AGREEMENT
This Asset Purchase Agreement (this “Agreement”), dated as of June 30, 2025, is entered into between, on the one hand, OMNIQ Corp., a Delaware corporation (“Parent”), Quest Marketing, Inc., an Oregon corporation, HTS Image Processing, Inc., a Delaware corporation, OmniQ Vision Inc., a Delaware corporation, HTS Image Ltd, a company domiciled in Israel, OmniQ Technologies Ltd, a company domiciled in Israel and Dangot Computers, Ltd, a company domiciled in Israel (collectively, the “Subsidiaries”, the Subsidiaries together with Parent, “Sellers” and each, a “Seller”), and, on the other hand, Summit Junction Holdings LLC, a Delaware limited liability company (“Buyer”). Capitalized terms used in this Agreement have the meanings given to such terms herein.
RECITALS
WHEREAS, OMNIQ Corporation owns, directly or indirectly, 100% of the issued and outstanding equity of the Subsidiaries;
WHEREAS, the Sellers own and operate, among other businesses, an integrated hardware, software, and automation solutions business specializing in barcode and RFID labeling, mobile and wireless equipment and printing systems (the “Transferred Business”); and
WHEREAS, Sellers wish to sell and assign to Buyer, and Buyer wishes to purchase and assume from Sellers, substantially all the assets, and certain specified liabilities, of the Transferred Business, subject to the terms and conditions set forth herein;
NOW, THEREFORE, in consideration of the mutual covenants and agreements hereinafter set forth and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:
ARTICLE I
PURCHASE AND SALE
Section 1.01 Purchase and Sale of Assets. Subject to the terms and conditions set forth herein, at the Closing, Sellers shall sell, convey, assign, transfer, and deliver to Buyer, and Buyer shall purchase from Sellers, all of Sellers’ right, title, and interest in, to, and under all of the tangible and intangible assets, properties, and rights of every kind and nature and wherever located (other than the Excluded Assets), which relate to, or are used or held for use in connection with, the Transferred Business (collectively, the “Purchased Assets”), including the following:
(a) all cash and cash equivalents;
(b) all accounts receivable held by Sellers related to the Transferred Business (“Accounts Receivable”);
(c) all inventory, finished goods, raw materials, work in progress, packaging, supplies, parts, and other inventories of the Transferred Business (“Inventory”);
(d) all Contracts (the “Assigned Contracts”) set forth on Section 1.01(d) of the disclosure schedules attached hereto (the “Disclosure Schedules”). The term “Contracts” means all contracts, leases, licenses, instruments, notes, commitments, undertakings, indentures, joint ventures, and all other agreements, commitments, and legally binding arrangements, whether written or oral;
(e) all furniture, fixtures, equipment, machinery, tools, vehicles, office equipment, supplies, computers, telephones, and other tangible personal property set forth on Section 1.01(e) of the Disclosure Schedules(the “Tangible Personal Property”);
(f) any and all rights in, arising out of, or associated with any of the following in any jurisdiction throughout the world: all (i) patents, patent applications, patent disclosures and inventions (whether or not patentable and whether or not reduced to practice) and any reissue, continuation, continuation-in-part, division, revision, extension or reexamination thereof; (ii) registered and unregistered trademarks, service marks, trade dress, logos, Internet domain names, trade names and company or organizational names together with all goodwill associated therewith; (iii) registered and unregistered copyrights and copyrightable works and mask works; (iv) all registrations, applications and renewals for any of the foregoing; (v) trade secrets and confidential information (including ideas, formulae, compositions, know-how, manufacturing and production processes and techniques, research and development information, drawings, specifications, designs, plans, databases, tools, methods, processes, techniques, proposals, technical data, financial, business and marketing plans, and customer and supplier lists and related information); (vi) computer software and software systems (including data, databases and related documentation), operating systems, applications, firmware and other code, including all source code, object code, application programming interfaces, data files, databases, protocols, specifications, and other documentation thereof; (vii) social media and email accounts, user names and passwords (including “handles”), whether or not trademarks, all associated web addresses, URLs, websites and web pages, social media sites and pages, phone numbers and all content and data thereon or relating thereto, whether or not copyrightable; and (viii) all income, royalties, rights (including all of Seller’s right and interest in and to any potential claim), damages and payments due or payable, with respect to (i)-(vii) (collectively, “Intellectual Property”);
(g) all prepaid expenses, credits, advance payments, claims, security, refunds, rights of recovery, rights of set-off, rights of recoupment, deposits, charges, sums, and fees (including any such item relating to the payment of Taxes) relating to the Purchased Assets;
(h) all of Sellers’ rights under warranties, indemnities, and all similar rights against third parties to the extent related to any Purchased Assets;
(i) all insurance benefits, including rights and proceeds, arising from or relating to the Transferred Business, the Purchased Assets, or the Assumed Liabilities;
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(j) originals or, where not available, copies, of all books and records, including books of account, ledgers, and general, financial, and accounting records, machinery and equipment maintenance files, customer lists, customer purchasing histories, price lists, distribution lists, supplier lists, production data, quality control records and procedures, customer complaints and inquiry files, research and development files, records, and data (including all correspondence with any federal, state, local, or foreign government or political subdivision thereof, or any agency or instrumentality of such government or political subdivision, or any arbitrator, court, or tribunal of competent jurisdiction (collectively, “Governmental Authority”)), sales material and records, strategic plans and marketing, and promotional surveys, material, and research (“Books and Records”);
(k) all goodwill and the going concern value of the Purchased Assets and the Transferred Business; and
(l) the assets, properties, and rights specifically set forth on Section 1.01(l) of the Disclosure Schedules.
Section 1.02 Excluded Assets. Notwithstanding the foregoing, the Purchased Assets shall not include the assets, properties, and rights specifically set forth on Section 1.02 of the Disclosure Schedules (collectively, the “Excluded Assets”).
Section 1.03 Assumed Liabilities.
(a) Subject to the terms and conditions set forth herein, Buyer shall assume and agree to pay, perform, and discharge only the following Liabilities of Sellers (collectively, the “Assumed Liabilities”), and no other Liabilities:
(i) all trade accounts payable of Sellers to third parties in connection with the Transferred Business that remain unpaid and are not delinquent as of the Closing Date;
(ii) all Liabilities in respect of the Assigned Contracts but only to the extent that such Liabilities thereunder are required to be performed after the Closing Date, were incurred in the ordinary course of business, and do not relate to any failure to perform, improper performance, warranty, or other breach, default, or violation by Sellers on or prior to the Closing; and
(iii) those Liabilities of Sellers set forth on Section 1.03(a)(iii) of the Disclosure Schedules.
For purposes of this Agreement, “Liabilities” means liabilities, obligations, or commitments of any nature whatsoever (including with respect to Taxes), whether asserted or unasserted, known or unknown, absolute or contingent, accrued or unaccrued, matured or unmatured, or otherwise.
(b) Notwithstanding any provision in this Agreement to the contrary, Buyer shall not assume and shall not be responsible to pay, perform, or discharge any Liabilities of Sellers or any of their respective Affiliates of any kind or nature whatsoever other than the Assumed Liabilities (the “Excluded Liabilities”). Excluded Liabilities shall include, but not be limited to,
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(i) any Liabilities of Sellers arising or incurred in connection with the negotiation, preparation, investigation and performance of this Agreement, the Transaction Documents and the transactions contemplated hereby and thereby, including, without limitation, fees and expenses of counsel, accountants, consultants, advisers and others;
(ii) any Liability for (i) Taxes of Sellers (or any equity owner or Affiliate of Seller) or relating to the Transferred Business, the Purchased Assets or the Assumed Liabilities for any Pre-Closing Tax Period; (ii) Taxes that arise out of the consummation of the transactions contemplated hereby or that are the responsibility of Seller pursuant to this Agreement; or (iii) other Taxes of Seller (or any equity owner or Affiliate of Seller) of any kind or description (including any Liability for Taxes of Seller (or any stockholder or Affiliate of Seller) that becomes a Liability of Buyer under any common law doctrine of de facto merger or transferee or successor liability or otherwise by operation of contract or Law);
(iii) any Liabilities relating to or arising out of the Excluded Assets;
(iv) any Liabilities in respect of any pending or threatened Action arising out of, relating to or otherwise in respect of the operation of the Transferred Business or the Purchased Assets to the extent such Action relates to such operation on or prior to the Closing Date;
(v) any warranty, product Liability or similar claim, including for injury to a Person or property which arises out of or is based upon any express or implied representation, warranty, agreement or guaranty made by Sellers, or by reason of the improper performance or malfunctioning of a product, improper design or manufacture, failure to adequately package, label or warn of hazards or other related product defects of any products at any time manufactured or sold or any service performed by Seller;
(vi) any recall, design defect or similar claims of any products manufactured or sold or any service performed by Seller;
(vii) any Liabilities of Seller arising under or in connection with any plan providing benefits to any present or former employee of Seller;
(viii) any Liabilities of Seller for any present or former employees, officers, directors, retirees, independent contractors or consultants of Seller, including, without limitation, any Liabilities associated with any claims for wages or other benefits, bonuses, accrued vacation, workers’ compensation, severance, retention, termination or other payments;
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(ix) any Environmental Claims, or Liabilities under Environmental Laws, to the extent arising out of or relating to facts, circumstances or conditions existing on or prior to the Closing or otherwise to the extent arising out of any actions or omissions of Seller;
(x) any trade accounts payable of Seller (i) to the extent not accounted for on the Balance Sheet; (ii) which constitute intercompany payables owing to Affiliates of Seller; (iii) which constitute debt, loans or credit facilities to financial institutions; or (iv) which did not arise in the ordinary course of business;
(xi) any Liabilities of the Transferred Business relating or arising from unfulfilled commitments, quotations, purchase orders, customer orders or work orders that (i) do not constitute part of the Purchased Assets issued by the Transferred Business’ customers to Seller on or before the Closing; (ii) did not arise in the ordinary course of business; or (iii) are not validly and effectively assigned to Buyer pursuant to this Agreement;
(xii) any Liabilities to indemnify, reimburse or advance amounts to any present or former officer, director, employee or agent of Seller (including with respect to any breach of fiduciary obligations by same);
(xiii) any Liabilities under Contracts that are not Assigned Contracts, (i) which are not validly and effectively assigned to Buyer pursuant to this Agreement; (ii) which do not conform to the representations and warranties with respect thereto contained in this Agreement; or (iii) to the extent such Liabilities arise out of or relate to a breach by Seller of such Contracts prior to Closing;
(xiv) any Liabilities associated with debt, loans or credit facilities of Seller and/or the Transferred Business owing to financial institutions;
(xv) any Liabilities arising out of, in respect of or in connection with the failure by Seller or any of its Affiliates to comply with any Law or Governmental Order; and
(xvi) those Liabilities of Sellers set forth on Section 1.03(b) of the Disclosure Schedules.
For purposes of this Agreement: (i) “Affiliate” of a Person means any other Person that directly or indirectly, through one or more intermediaries, controls, is controlled by, or is under common control with, such Person; and (ii) the term “control” (including the terms “controlled by” and “under common control with”) means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting securities, by contract, or otherwise.
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Section 1.04 Purchase Price. The aggregate purchase price for the Purchased Assets shall be $65.0 million (plus the right set forth in Section 1.04(c)) (the “Purchase Price”), which shall be comprised of:
(a) the assumption of $55.0 million in Assumed Liabilities; and
(b) In the event that Buyer enters into an agreement to sell all of the capital stock of Buyer or substantially all of its assets, which includes the Transferred Business (a “Sale”), within 18 months of the date hereof, the Sellers shall have a right of first refusal to effectuate such purchase on the same terms, and such purchase shall include Buyer deeming satisfied the Promissory Note (as defined herein). In the event that the Sellers do not exercise such right and the Buyer consummates the Sale for a purchase price in excess of $100,000,000 within 18 months of the date hereof, the Buyer shall pay the Sellers $10,000,000 of such Sale consideration, less the balance of obligations due on the Promissory Note. In the event that Summit consummates an initial public offering (an “IPO) at a valuation in excess of $100,000,000, then Summit shall issue the Sellers common stock of Buyer having a valuation of $10,000,000 based on the IPO valuation, less the balance of obligations due on the Promissory Note.
Section 1.05 Allocation of Purchase Price. The Purchase Price and the Assumed Liabilities shall be allocated among the Purchased Assets for all purposes (including Tax and financial accounting) as shown on the allocation schedule set forth on Section 1.05 of the Disclosure Schedules (the “Allocation Schedule”). The Allocation Schedule shall be prepared by Buyer in accordance with Section 1060 of the Internal Revenue Code of 1986, as amended (the “Code”). Buyer and Sellers shall file all returns, declarations, reports, information returns and statements, and other documents relating to Taxes (including amended returns and claims for refund) (“Tax Returns”) in a manner consistent with the Allocation Schedule. Buyer and Seller agree Sellers’ Accounting Firm shall prepare the first tax return for Buyer at Sellers’ expense, to ensure alignment with this Agreement and suggest any strategies for the parties to adjust if mutually agreed, and Buyer will have sole right to adjust the Purchase Price Allocation in connection therewith.
Section 1.06 Withholding Tax. Upon notice to Sellers, Buyer shall be entitled to deduct and withhold from the Purchase Price all Taxes that Buyer may be required to deduct and withhold under any provision of Tax Law, including without limitation, pursuant to Sections 6045 or 897 of the Code. All such withheld amounts shall be treated as delivered to Sellers hereunder.
Section 1.07 Third-Party Consents. To the extent that Sellers’ rights under any Purchased Asset may not be assigned to Buyer without the consent of another Person which has not been obtained, this Agreement shall not constitute an agreement to assign the same if an attempted assignment would constitute a breach thereof or be unlawful, and Sellers, at their expense, shall use reasonable best efforts to obtain any such required consent(s) as promptly as possible. If any such consent shall not be obtained or if any attempted assignment would be ineffective or would impair Buyer’s rights under the Purchased Asset in question so that Buyer would not in effect acquire the benefit of all such rights, Sellers, to the maximum extent permitted by Law and the Purchased Asset, shall act after the Closing as Buyer’s agent in order to obtain for it the benefits thereunder and shall cooperate, to the maximum extent permitted by Law and the Purchased Asset, with Buyer in any other reasonable arrangement designed to provide such benefits to Buyer.
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ARTICLE II CLOSING
Section 2.01 Closing. Subject to the terms and conditions of this Agreement, the consummation of the transactions contemplated by this Agreement (the “Closing”) shall take place remotely by exchange of documents and signatures (or their electronic counterparts), to be effective at 12:01am PT on the date hereof. The date on which the Closing is to occur is herein referred to as the “Closing Date.”
Section 2.02 Closing Deliverables.
(a) At the Closing, Sellers shall deliver to Buyer the following:
(i) a bill of sale in form and substance satisfactory to Buyer and Sellers (the “Bill of Sale”) and duly executed by Sellers, transferring the Tangible Personal Property included in the Purchased Assets to Buyer;
(ii) an assignment and assumption agreement in form and substance satisfactory to Buyer and Sellers (the “Assignment and Assumption Agreement”) and duly executed by Sellers, effecting the assignment to and assumption by Buyer of the Purchased Assets and the Assumed Liabilities;
(iii) an assignment in form and substance satisfactory to Buyer (the “Intellectual Property Assignments”) and duly executed by Sellers, transferring all of Sellers’ right, title and interest in and to the Intellectual Property to Buyer;
(iv) the Transition Services Agreement in form and substance satisfactory to Buyer (the “Transition Services Agreement”) and duly executed by Seller;
(v) the License Agreement (the “License Agreement”) and duly executed by Seller;
(vi) a certificate of the Secretary (or equivalent officer) of each Seller certifying as to (A) the resolutions of the board of directors or board of managers and, if applicable, the shareholders or members of each Seller, which authorize the execution, delivery, and performance of this Agreement, the Bill of Sale, the Assignment and Assumption Agreement, the Intellectual Property Assignments, the Transition Services Agreement, the License Agreement and the other agreements, instruments, and documents required to be delivered in connection with this Agreement or at the Closing (collectively, the “Transaction Documents”) and the consummation of the transactions contemplated hereby and thereby, and (B) the names and signatures of the officers of each Seller authorized to sign this Agreement and the other Transaction Documents;
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(vii) evidence satisfactory to Buyer of the release of the liens evidenced by UCC File No. 93759385, originally filed January 8, 2024, in favor of Prestige Capital Finance, LLC as secured party;
(viii) payment to Buyer, in immediately available funds, via wire, of all Buyer Transaction Expenses accrued as of the Closing, less $100,000.00; and
(ix) such other customary instruments of transfer or assumption, filings, or documents, in form and substance reasonably satisfactory to Buyer, as may be required to give effect to the transactions contemplated by this Agreement.
(b) At the Closing, Buyer shall deliver to Sellers the following:
(i) a Promissory Note of Buyer, as lender, in favor of Parent, as borrower, in the principal aggregate amount of $10,000,000.00, in the form set forth on Exhibit A (the “Promissory Note”);
(ii) the Assignment and Assumption Agreement duly executed by Buyer;
(iii) the Intellectual Property Assignments duly executed by Buyer;
(iv) the Transition Services Agreement duly executed by Buyer; and
(v) the License Agreement duly executed by Buyer.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF SELLERS
Each Seller represents and warrants, jointly and severally, with respect to itself and each other Seller, to Buyer that the statements contained in this ARTICLE III are true and correct as of the date hereof.
Section 3.01 Organization and Authority of Sellers. Each Seller is duly organized and validly existing. Each Seller (other than any Seller domiciled in Israel) is in good standing under the Laws of its state of organization. Each Seller has full corporate or company, as applicable, power and authority to enter into this Agreement and the other Transaction Documents to which such Seller is a party, to carry out its obligations hereunder and thereunder, and to consummate the transactions contemplated hereby and thereby. The execution and delivery by each Seller of this Agreement and any other Transaction Document to which such Seller is a party, the performance by such Seller of its obligations hereunder and thereunder, and the consummation by such Seller of the transactions contemplated hereby and thereby have been duly authorized by all requisite corporate or company, as applicable, board, and shareholder or other equity holder, as applicable, action on the part of Seller. This Agreement and the Transaction Documents constitute legal, valid, and binding obligations of each Seller enforceable against each Seller in accordance with their respective terms.
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Section 3.02 No Conflicts or Consents. The execution, delivery, and performance by Sellers of this Agreement and the other Transaction Documents to which it is a party, and the consummation of the transactions contemplated hereby and thereby, do not and will not: (a) violate or conflict with any provision of the certificate of incorporation, bylaws, or other governing documents of Sellers; (b) violate or conflict with any provision of any statute, law, ordinance, regulation, rule, code, constitution, treaty, common law, other requirement, or rule of law of any Governmental Authority (collectively, “Law”) or any order, writ, judgment, injunction, decree, stipulation, determination, penalty, or award entered by or with any Governmental Authority (“Governmental Order”) applicable to Sellers, the Transferred Business, or the Purchased Assets; (c) require the consent, notice, declaration, or filing with or other action by any individual, corporation, partnership, joint venture, limited liability company, Governmental Authority, unincorporated organization, trust, association, or other entity (“Person”) or require any permit, license, or Governmental Order; (d) violate or conflict with, result in the acceleration of, or create in any party the right to accelerate, terminate, modify, or cancel any Contract to which Sellers are a party or by which Sellers or the Transferred Business is bound or to which any of the Purchased Assets are subject (including any Assigned Contract); or (e) result in the creation or imposition of any charge, claim, pledge, equitable interest, lien, security interest, restriction of any kind, or other encumbrance (“Encumbrance”) on the Purchased Assets, other than Encumbrances related to an Assumed Liability.
Section 3.03 Financial Statements. Complete copies of the financial statements consisting of the balance sheet of Sellers as of December 31 in each of the years ending December 31, 2022, 2023 and 2024 and the related statements of income and retained earnings, shareholders’ equity, and cash flow for the years then ended (the “Financial Statements”) have been delivered to Buyer. The Financial Statements have been prepared in accordance with generally accepted accounting principles in effect in the United States from time to time, applied on a consistent basis throughout the period involved. The Financial Statements fairly present the financial condition of the Transferred Business as of the respective dates they were prepared and the results of the operations of the Transferred Business for the periods indicated. The balance sheet of the Transferred Business as of March 31, 2025 is referred to herein as the “Balance Sheet” and the date thereof as the “Balance Sheet Date”.
Section 3.04 Undisclosed Liabilities. Sellers have no Liabilities with respect to the Transferred Business, except (a) those which are adequately reflected or reserved against in the Balance Sheet as of the Balance Sheet Date, and (b) those which have been incurred in the ordinary course of business consistent with past practice since the Balance Sheet Date and which are not, individually or in the aggregate, material in amount.
Section 3.05 Absence of Certain Changes, Events, and Conditions. Since the Balance Sheet Date, the Transferred Business has been conducted in the ordinary course of business consistent with past practice and there has not been any change, event, condition, or development that is, or could reasonably be expected to be, individually or in the aggregate, materially adverse to: (a) the business, results of operations, condition (financial or otherwise), or assets of the Transferred Business; or (b) the value of the Purchased Assets.
Section 3.06 Assigned Contracts. Each Assigned Contract is valid and binding on Sellers in accordance with its terms and is in full force and effect. Neither Sellers nor, to any Seller’s knowledge, any other party thereto is in breach of or default under (or is alleged to be in breach of or default under), or has provided or received any notice of any intention to terminate, any Assigned Contract. No event or circumstance has occurred that would constitute an event of default under any Assigned Contract or result in a termination thereof. Complete and correct copies of each Assigned Contract (including all modifications, amendments, and supplements thereto and waivers thereunder) have been made available to Buyer. There are no disputes pending or threatened under any Assigned Contract.
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Section 3.07 Title to Purchased Assets. Sellers have good and valid title to all the Purchased Assets, free and clear of Encumbrances, other than Encumbrances related to an Assumed Liability.
Section 3.08 Condition and Sufficiency of Assets. Each item of Tangible Personal Property is structurally sound, is in good operating condition and repair, and is adequate for the uses to which it is being put, and no item of Tangible Personal Property is in need of maintenance or repairs except for ordinary, routine maintenance and repairs that are not material in nature or cost. The Purchased Assets are sufficient for the continued conduct of the Transferred Business after the Closing in substantially the same manner as conducted prior to the Closing and constitute all of the rights, property, and assets necessary to conduct the Transferred Business as currently conducted. None of the Excluded Assets are material to the Transferred Business.
Section 3.09 Intellectual Property.
(a) Sellers are the sole and exclusive legal and beneficial, and record, owner of all right, title, and interest in and to the Intellectual Property, and have the valid and enforceable right to use all Intellectual Property used in or necessary for the conduct of the Transferred Business as currently conducted, in each case, free and clear of all Encumbrances.
(b) All registrations, assignments and other instruments necessary to establish, record, and perfect Sellers’ ownership interest in the Intellectual Property have been validly executed, delivered, and timely filed with the relevant Governmental Authorities and authorized registrars and are in full force and effect.
(c) Neither the execution, delivery, or performance of this Agreement, nor the consummation of the transactions contemplated hereunder, will result in the loss or impairment of or payment of any additional amounts with respect to, or require the consent of any other Person in respect of, the Buyer’s right to own or use any Intellectual Property. Immediately following the Closing, all Intellectual Property related to the Transferred Business will be owned by Buyer, other than such Intellectual Property licensed pursuant to the License Agreement, which shall be licensed to the Buyer.
(d) Sellers have taken all necessary steps to maintain and enforce the Intellectual Property and to preserve the confidentiality of all trade secrets included therein, including by requiring all Persons having access thereto to execute binding, written non-disclosure agreements.
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(e) The conduct of the Transferred Business as currently and formerly conducted and as proposed to be conducted, including the use of the Intellectual Property in connection therewith, and the products, processes, and services of the Transferred Business have not infringed, misappropriated, or otherwise violated and will not infringe, misappropriate, or otherwise violate the rights of any Person. To the Seller’s knowledge, no Person has infringed, misappropriated, or otherwise violated any of Sellers’ rights in the Intellectual Property.
Section 3.10 Accounts Receivable. The Accounts Receivable: (a) have arisen from bona fide transactions entered into by Sellers involving the sale of goods or the rendering of services in the ordinary course of business consistent with past practice; (b) constitute only valid, undisputed claims of Sellers not subject to claims of set-off or other defenses or counterclaims other than normal cash discounts accrued in the ordinary course of business consistent with past practice; and (c) are collectible in full within ninety (90) days after billing.
Section 3.11 Legal Proceedings; Governmental Orders. Other than as set forth on Section 3.11 of the Disclosure Schedules, there are no claims, actions, causes of action, demands, lawsuits, arbitrations, inquiries, audits, notices of violation, proceedings, litigation, citations, summons, subpoenas, or investigations of any nature, whether at law or in equity (collectively, “Actions”) pending or, to Sellers’ knowledge, threatened against or by Sellers: (i) relating to or affecting the Transferred Business, the Purchased Assets, or the Assumed Liabilities; or (ii) that challenge or seek to prevent, enjoin, or otherwise delay the transactions contemplated by this Agreement. No event has occurred or circumstances exist that may give rise to, or serve as a basis for, any such Action. There are no Governmental Orders against, relating to, or affecting the Business or the Purchased Assets.
Section 3.12 Compliance with Laws. Sellers are in compliance with all Laws, including without limitation such Laws that are applicable to the conduct of the Transferred Business as currently conducted or the ownership and use of the Purchased Assets. All permits, licenses, franchises, approvals, authorizations, registrations, certificates, variances and similar rights obtained, or required to be obtained, from Governmental Authorities required for Sellers to conduct the Transferred Business as currently conducted or for the ownership and use of the Purchased Assets have been obtained by Sellers, are valid and in full force and effect.
Section 3.13 Taxes. Other than as set forth on Section 3.13 of the Disclosure Schedules, all Taxes due and owing by Sellers have been, or will be, timely paid. No extensions or waivers of statutes of limitations have been given or requested with respect to any Taxes of Sellers. All Tax Returns required to be filed by Sellers for any tax periods prior to Closing have been, or will be, timely filed. Such Tax Returns are, or will be, true, complete, and correct in all respects. The term “Taxes” means all federal, state, local, foreign, and other income, gross receipts, sales, use, production, ad valorem, transfer, documentary, franchise, registration, profits, license, withholding, payroll, employment, unemployment, excise, severance, stamp, occupation, premium, property (real or personal), customs, duties, or other taxes, fees, assessments, or charges of any kind whatsoever, together with any interest, additions, or penalties with respect thereto.
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Section 3.14 Related Party Transactions. There are no Contracts or other arrangements involving the Transferred Business in which Sellers, its Affiliates, or any of its or their respective directors, officers, or employees or any immediate family members thereof is a party, has a financial interest, or otherwise owns or leases any Purchased Asset.
Section 3.15 Brokers. No broker, finder, or investment banker is entitled to any brokerage, finder’s, or other fee or commission in connection with the transactions contemplated by this Agreement or any other Transaction Document based upon arrangements made by or on behalf of Sellers.
Section 3.16 Insurance. To Sellers’ knowledge, there are no pending claims under any such policy as to which coverage has been questioned, denied or disputed by the insurer or in respect of which the insurer has reserved its rights. To Sellers’ knowledge, all such policies are in full force and effect, are enforceable in accordance with their terms and will continue in full force and effect through and immediately after the Closing, and are concerning such casualties as would be reasonable and customary for companies like the Sellers. All premiums due under such policies have been paid in full. No Seller has received a notice of cancellation of any such policy or of any material changes that are required in the conduct of the insured’s business as a condition to the continuation of coverage under, or renewal of, any such policy. To Sellers’ knowledge, there is no existing default or event which, with or without the giving of notice or the lapse of time or both, would constitute a default under any such policy or entitle any insurer to terminate or cancel any such policy.
Section 3.17 Full Disclosure. No representation or warranty by Sellers in this Agreement and no statement contained in the Disclosure Schedules to this Agreement or any certificate or other document furnished or to be furnished to Buyer pursuant to this Agreement contains any untrue statement of a material fact, or omits to state a material fact necessary to make the statements contained therein, in light of the circumstances in which they are made, not misleading.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF BUYER
Buyer represents and warrants to Sellers that the statements contained in this ARTICLE IV are true and correct as of the date hereof.
Section 4.01 Organization and Authority of Buyer. Buyer is a limited liability company duly organized, validly existing, and in good standing under the Laws of the State of Delaware. Buyer has full company power and authority to enter into this Agreement and the other Transaction Documents to which Buyer is a party, to carry out its obligations hereunder and thereunder, and to consummate the transactions contemplated hereby and thereby. The execution and delivery by Buyer of this Agreement and any other Transaction Document to which Buyer is a party, the performance by Buyer of its obligations hereunder and thereunder, and the consummation by Buyer of the transactions contemplated hereby and thereby have been duly authorized by all requisite corporate action on the part of Buyer. This Agreement and the Transaction Documents constitute legal, valid, and binding obligations of Buyer enforceable against Buyer in accordance with their respective terms.
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Section 4.02 No Conflicts; Consents. The execution, delivery, and performance by Buyer of this Agreement and the other Transaction Documents to which it is a party, and the consummation of the transactions contemplated hereby and thereby, do not and will not: (a) violate or conflict with any provision of the certificate of formation or other organizational documents of Buyer; (b) violate or conflict with any provision of any Law or Governmental Order applicable to Buyer; or (c) require the consent, notice, declaration, or filing with or other action by any Person or require any permit, license, or Governmental Order.
Section 4.03 Brokers. No broker, finder, or investment banker is entitled to any brokerage, finder’s, or other fee or commission in connection with the transactions contemplated by this Agreement or any other Transaction Document based upon arrangements made by or on behalf of Buyer.
Section 4.04 Legal Proceedings. There are no Actions pending or, to Buyer’s knowledge, threatened against or by Buyer that challenge or seek to prevent, enjoin, or otherwise delay the transactions contemplated by this Agreement. No event has occurred or circumstances exist that may give rise to, or serve as a basis for, any such Action.
ARTICLE V
COVENANTS
Section 5.01 Confidentiality. From and after the Closing, Sellers shall, and shall cause each of their respective Affiliates to, hold, and shall use their reasonable best efforts to cause its or their respective directors, officers, employees, consultants, counsel, accountants, and other agents (“Representatives”) to hold, in confidence any and all information, whether written or oral, concerning the Transferred Business, except to the extent that Sellers can show that such information: (a) is generally available to and known by the public through no fault of Sellers, any of its Affiliates, or their respective Representatives; or (b) is lawfully acquired by Sellers, any of its Affiliates, or their respective Representatives from and after the Closing from sources which are not prohibited from disclosing such information by a legal, contractual, or fiduciary obligation. If Sellers or any of its Affiliates or their respective Representatives are compelled to disclose any information by Governmental Order or Law, Sellers shall promptly notify Buyer in writing and shall disclose only that portion of such information which is legally required to be disclosed as determined in good faith by collaboration between counsel for Buyer and Sellers, provided that Sellers shall use reasonable best efforts to obtain as promptly as possible an appropriate protective order or other reasonable assurance that confidential treatment will be accorded such information.
Section 5.02 Non-Competition; Non-Solicitation.
(a) Sellers acknowledges the competitive nature of the Transferred Business and accordingly agree, in connection with the sale of the Purchased Assets, including the goodwill of the Transferred Business, which Buyer considers to be a valuable asset, and in exchange for good and valuable consideration, that for a period of five (5) years commencing on the Closing Date (the “Restricted Period”), Sellers shall not, and shall not permit any of its Affiliates to, directly or indirectly, (i) engage in or assist others in engaging in the Transferred Business (the “Restricted Business”) in any geographic area in which Buyer is conducting the Transferred Business or has made tangible plans to conduct the Transferred Business (the “Territory”); (ii) have an interest in any Person that engages directly or indirectly in the Restricted Business in the Territory in any capacity, including as a partner, shareholder, director, member, manager, employee, principal, agent, trustee, or consultant; or (iii) cause, induce, or encourage any material actual or prospective client, customer, supplier, or licensor of the Transferred Business (including any existing or former client or customer of Sellers and any Person that becomes a client or customer of the Transferred Business after the Closing), or any other Person who has a material business relationship with the Transferred Business, to terminate or modify any such actual or prospective relationship. Notwithstanding the foregoing, Sellers may own, directly or indirectly, solely as an investment, securities of any Person traded on any national securities exchange if Sellers is not a controlling Person of, or a member of a group which controls, such Person and does not, directly or indirectly, own five percent (5%) or more of any class of securities of such Person.
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(b) During the Restricted Period, Sellers shall not, and shall not permit any of its Affiliates to, directly or indirectly, hire or solicit any person who is or was employed in the Transferred Business during the Restricted Period, 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 5.02(b) shall prevent Sellers or any of its Affiliates from hiring (i) any employee whose employment has been terminated by Buyer; or (ii) after one year from the date of termination of employment, any employee whose employment has been terminated by the employee.
(c) At all times after the date of this Agreement, neither Seller nor any of its Affiliates will undertake or engage in any publication or any type of communications, oral or written, of a defamatory or disparaging statement or nature pertaining to Buyer, or any Affiliate or Representative of Buyer, their respective businesses or the Purchased Assets.
(d) Sellers acknowledges that a breach or threatened breach of this Section 5.02 would give rise to irreparable harm to Buyer, for which monetary damages would not be an adequate remedy, and hereby agrees that in the event of a breach or a threatened breach by Sellers of any such obligations, Buyer shall, in addition to any and all other rights and remedies that may be available to it in respect of such breach, be entitled to equitable relief, including a temporary restraining order, an injunction, specific performance, and any other relief that may be available from a court of competent jurisdiction (without any requirement to post bond).
(e) Sellers acknowledge that the restrictions contained in this Section 5.02 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 5.02 should ever be adjudicated to exceed the time, geographic, product or service, or other limitations permitted by applicable Law in any jurisdiction or any Governmental Order, then any court is expressly empowered to reform such covenant in such jurisdiction to the maximum time, geographic, product or service, or other limitations permitted by applicable Law or such Governmental Order. The covenants contained in this Section 5.02 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.
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Section 5.03 Public Announcements. Unless otherwise required by applicable Law, no party to this Agreement shall make any public announcements in respect of this Agreement or the transactions contemplated hereby without the prior written consent of the other party (which consent shall not be unreasonably withheld or delayed), and the parties shall cooperate as to the timing and contents of any such announcement.
Section 5.04 Bulk Sales Laws. The parties hereby waive compliance with the provisions of any bulk sales, bulk transfer, or similar Laws of any jurisdiction that may otherwise be applicable with respect to the sale of any or all of the Purchased Assets to Buyer. Any Liabilities arising out of the failure of Sellers to comply with the requirements and provisions of any bulk sales, bulk transfer, or similar Laws of any jurisdiction which would not otherwise constitute Assumed Liabilities shall be borne equally by Buyer, on the one hand, and Sellers, on the other hand.
Section 5.05 Receivables. From and after the Closing, if Sellers or any of its Affiliates receives or collects any funds relating to any Accounts Receivable or any other Purchased Asset, Sellers or its Affiliate shall remit such funds to Buyer within five (5) days after its receipt thereof. From and after the Closing, if Buyer or its Affiliate receives or collects any funds relating to any Excluded Asset, Buyer or its Affiliate shall remit any such funds to Sellers within five (5) business days after its receipt thereof.
Section 5.06 Transfer Taxes. All sales, use, registration, and other such Taxes and fees (including any penalties and interest) incurred in connection with this Agreement and the other Transaction Documents, if any, shall be borne and paid by Sellers when due. Sellers shall, at its own expense, timely file any Tax Return or other document with respect to such Taxes or fees (and Buyer shall cooperate with respect thereto as necessary).
Section 5.07 Further Assurances. Following the Closing, each of the parties hereto shall, and shall cause their respective Affiliates to, execute and deliver such additional documents, instruments, conveyances, and assurances and take such further actions as may be reasonably required to carry out the provisions hereof and give effect to the transactions contemplated by this Agreement and the other Transaction Documents.
Section 5.08 CBP Fee. Within 45 days following each fiscal quarter, Sellers shall pay Buyer 30% of the Net Contract Proceeds for the applicable prior fiscal quarter. “Net Contract Proceeds” means the gross invoice price of sales or other dispositions to or for the benefit of the United States Customs and Border Protection (or its successor) in the prior fiscal quarter related to Sellers’ or its Affiliates’ biometric entry-exist system, less all taxes, tariffs, government charges, freight, shipping, handling, insurance charges, credits (arising from returns or other adjustments), discounts, rebates, or allowances of any kind actually incurred. Net Contract Proceeds do not include sales or transfers by Buyer to its Affiliates for resale; provided that the Net Sales calculation will include the amounts invoiced by such Affiliate on the resale of such products.
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ARTICLE VI
INDEMNIFICATION
Section 6.01 Survival. Subject to the limitations and other provisions of this Agreement, the representations and warranties contained herein shall survive the Closing and shall remain in full force and effect until the date that is twenty four (24) months from the Closing Date; provided, that the representations and warranties in (i) Sections 3.01, 3.02, 3.06, 3.07, 3.09, 3.12, 3.14, 3.15 and 3.16 shall survive indefinitely, and (ii) Section 3.13 shall survive for the full period of all applicable statutes of limitations (giving effect to any waiver, mitigation or extension thereof) plus 60 days. All claims arising from fraud shall survive closing indefinitely. All covenants and agreements of the parties contained herein shall survive the Closing indefinitely or for the period explicitly specified therein. Notwithstanding the foregoing, any claims asserted in good faith with reasonable specificity (to the extent known at such time) and in writing by notice from the non-breaching party to the breaching party prior to the expiration date of the applicable survival period shall not thereafter be barred by the expiration of the relevant representation or warranty and such claims shall survive until finally resolved.
Section 6.02 Indemnification by Sellers. Subject to the other terms and conditions of this ARTICLE VI, from and after Closing, Sellers, jointly and severally, shall indemnify and defend each of Buyer and its Affiliates and their respective Representatives (collectively, the “Buyer Indemnitees”) against, and shall hold each of them harmless from and against, any and all losses, damages, liabilities, deficiencies, Actions, judgments, interest, awards, penalties, fines, costs, or expenses of whatever kind, including reasonable attorneys’ fees (collectively, “Losses”), incurred or sustained by, or imposed upon, the Buyer Indemnitees based upon, arising out of, or with respect to:
(a) any inaccuracy in or breach of any of the representations or warranties of Sellers contained in this Agreement, any other Transaction Document, or any schedule, certificate, or exhibit related thereto, as of the date such representation or warranty was made or as if such representation or warranty was made on and as of the Closing Date (except for representations and warranties that expressly relate to a specified date, the inaccuracy in or breach of which will be determined with reference to such specified date);
(b) any breach or non-fulfillment of any covenant, agreement, or obligation to be performed by Sellers pursuant to this Agreement, any other Transaction Document, or any schedule, certificate, or exhibit related thereto;
(c) any Excluded Asset or any Excluded Liability, and any claims related thereto, including but not limited to the failure of Buyer to satisfy the Assumed Liability; or
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(d) any Third-Party Claim based upon, resulting from, or arising out of the business, operations, properties, assets, or obligations of Sellers or any of its Affiliates (other than the Purchased Assets or Assumed Liabilities) conducted, existing, or arising on or prior to the Closing Date. For purposes of this Agreement, “Third-Party Claim” means notice of the assertion or commencement of any Action made or brought by any Person who is not a party to this Agreement or an Affiliate of a party to this Agreement or a Representative of the foregoing.
The rights of the Buyer to indemnification or any other remedy under this Agreement shall not be impacted or limited by any knowledge that the Buyer may have acquired, or could have acquired, whether before or after the closing date, nor by any investigation or diligence by the Buyer or its Affiliates or representatives. Sellers hereby acknowledge that, regardless of any investigation made (or not 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 representations and warranties of the Sellers made in this Agreement..
Section 6.03 Indemnification by Buyer. Subject to the other terms and conditions of this ARTICLE VI, from and after Closing, Buyer shall indemnify and defend each Seller and its Affiliates and their respective Representatives (collectively, the “Sellers Indemnitees”) against, and shall hold each of them harmless from and against any and all Losses incurred or sustained by, or imposed upon, the Sellers Indemnitees based upon, arising out of, or with respect to:
(a) any inaccuracy in or breach of any of the representations or warranties of Buyer contained in this Agreement, any other Transaction Document, or any schedule, certificate, or exhibit related thereto, as of the date such representation or warranty was made or as if such representation or warranty was made on and as of the Closing Date (except for representations and warranties that expressly relate to a specified date, the inaccuracy in or breach of which will be determined with reference to such specified date);
(b) any breach or non-fulfillment of any covenant, agreement, or obligation to be performed by Buyer pursuant to this Agreement; or
(c) any Assumed Liability and any claims related thereto, including but not limited to the failure of Buyer to satisfy the Assumed Liability.
Section 6.04 Indemnification Procedures. Whenever any claim shall arise for indemnification hereunder, the party entitled to indemnification (the “Indemnified Party”) shall promptly provide written notice of such claim to the other party (the “Indemnifying Party”). In connection with any claim giving rise to indemnity hereunder resulting from or arising out of any Action by a Person who is not a party to this Agreement, the Indemnifying Party, at its sole cost and expense and upon written notice to the Indemnified Party, may assume the defense of any such Action with counsel reasonably satisfactory to the Indemnified Party. The Indemnified Party shall be entitled to participate in the defense of any such Action, with its counsel and at its own cost and expense. If the Indemnifying Party does not assume the defense of any such Action, the Indemnified Party may, but shall not be obligated to, defend against such Action in such manner as it may deem appropriate, including settling such Action, after giving notice of it to the Indemnifying Party, on such terms as the Indemnified Party may deem appropriate and no action taken by the Indemnified Party in accordance with such defense and settlement shall relieve the Indemnifying Party of its indemnification obligations herein provided with respect to any damages resulting therefrom. The Indemnifying Party shall not settle any Action without the Indemnified Party’s prior written consent (which consent shall not be unreasonably withheld or delayed). Each Sellers’ obligations to indemnify, contribute, defend and otherwise shall be joint and several. Notwithstanding anything in this Agreement to the contrary, any Losses for which Buyer is entitled to indemnification shall be applied in reduction of amounts due from Buyer to any Seller under this Agreement.
Section 6.05 Cumulative Remedies. The rights and remedies provided in this ARTICLE VI are cumulative and are in addition to and not in substitution for any other rights and remedies available at law or in equity or otherwise.
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ARTICLE VII
MISCELLANEOUS
Section 7.01 Expenses. All costs and expenses incurred in connection with this Agreement and the transactions contemplated hereby shall be paid by the party incurring such costs and expenses; provided, however, Sellers shall pay all accounting and legal fees of Buyer and its Affiliates in connection with the transactions contemplated hereby (collectively, the “Buyer Transaction Expenses”).
Section 7.02 Notices. All notices, claims, demands, and other communications hereunder shall be in writing and shall be deemed to have been given: (a) when delivered by hand (with written confirmation of receipt); (b) when received by the addressee if sent by a nationally recognized overnight courier (receipt requested); (c) on the date sent by email of a PDF document (with confirmation of transmission) if sent during normal business hours of the recipient, and on the next business day if sent after normal business hours of the recipient, or (d) on the third day after the date mailed, by certified or registered mail, return receipt requested, postage prepaid. Such communications must be sent to the respective parties at the addresses (or at such other address for a party as shall be specified in a notice given in accordance with this Section 7.02) on the signature page hereto.
Section 7.03 Interpretation; Headings. This Agreement shall be construed without regard to any presumption or rule requiring construction or interpretation against the party drafting an instrument or causing any instrument to be drafted. The headings in this Agreement are for reference only and shall not affect the interpretation of this Agreement.
Section 7.04 Severability. If any term or provision of this Agreement is invalid, illegal, or unenforceable in any jurisdiction, such invalidity, illegality, or unenforceability shall not affect any other term or provision of this Agreement.
Section 7.05 Entire Agreement. This Agreement and the other Transaction Documents constitute the sole and entire agreement of the parties to this Agreement with respect to the subject matter contained herein and therein, and supersede all prior and contemporaneous understandings and agreements, both written and oral, with respect to such subject matter. In the event of any inconsistency between the statements in the body of this Agreement and those in the other Transaction Documents, the Exhibits, and the Disclosure Schedules (other than an exception expressly set forth as such in the Disclosure Schedules), the statements in the body of this Agreement will control.
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Section 7.06 Successors and Assigns. This Agreement shall be binding upon and shall inure to the benefit of the parties hereto and their respective successors and permitted assigns. Neither party may assign its rights or obligations hereunder without the prior written consent of the other party, which consent shall not be unreasonably withheld or delayed. Any purported assignment in violation of this Section shall be null and void. No assignment shall relieve the assigning party of any of its obligations hereunder.
Section 7.07 Amendment and Modification; Waiver. This Agreement may only be amended, modified, or supplemented by an agreement in writing signed by each party hereto. No waiver by any party of any of the provisions hereof shall be effective unless explicitly set forth in writing and signed by the party so waiving. No failure to exercise, or delay in exercising, any right or remedy arising from this Agreement shall operate or be construed as a waiver thereof; nor shall any single or partial exercise of any right or remedy hereunder preclude any other or further exercise thereof or the exercise of any other right or remedy.
Section 7.08 Governing Law; Submission to Jurisdiction; Waiver of Jury Trial.
(a) All matters arising out of or relating to this Agreement shall be governed by and construed in accordance with the internal laws of the State of Delaware without giving effect to any choice or conflict of law provision or rule (whether of the State of Delaware or any other jurisdiction). Any legal suit, action, proceeding, or dispute arising out of or related to this Agreement, the other Transaction Documents, or the transactions contemplated hereby or thereby may be instituted in the federal courts of the United States of America or the courts of the State of Delaware in each case embracing the City of Wilmington, and each party irrevocably submits to the exclusive jurisdiction of such courts in any such suit, action, proceeding, or dispute.
(b) EACH PARTY ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY WHICH MAY ARISE UNDER THIS AGREEMENT OR THE OTHER TRANSACTION DOCUMENTS IS LIKELY TO INVOLVE COMPLICATED AND DIFFICULT ISSUES AND, THEREFORE, EACH PARTY IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL ACTION, PROCEEDING, CAUSE OF ACTION, OR COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS AGREEMENT, INCLUDING ANY EXHIBITS AND SCHEDULES ATTACHED TO THIS AGREEMENT, THE OTHER TRANSACTION DOCUMENTS, OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY. EACH PARTY CERTIFIES AND ACKNOWLEDGES THAT: (I) NO REPRESENTATIVE OF THE OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT THE OTHER PARTY WOULD NOT SEEK TO ENFORCE THE FOREGOING WAIVER IN THE EVENT OF A LEGAL ACTION; (II) EACH PARTY HAS CONSIDERED THE IMPLICATIONS OF THIS WAIVER; (III) EACH PARTY MAKES THIS WAIVER KNOWINGLY AND VOLUNTARILY; AND (IV) EACH PARTY HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.
Section 7.09 Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original, but all of which together shall be deemed to be one and the same agreement. A signed copy of this Agreement delivered by email or other means of electronic transmission shall be deemed to have the same legal effect as delivery of an original signed copy of this Agreement.
[SIGNATURE PAGE TO FOLLOW]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the date first written above by their duly authorized representatives.
| SELLERS: | |
| OMNIQ CORP. | |
| QUEST MARKETING, INC. | |
| HTS IMAGE PROCESSING, INC. OMNIQ VISION INC. | |
| HTS IMAGE LTD. | |
| OMNIQ TECHNOLOGIES LTD | |
| DANGOT COMPUTERS, LTD |
| By: | /s/ Shai Lustgarten | |
| Name: | Shai Lustgarten | |
| Title: | Chief Executive Officer |
| BUYER: | ||
| SUMMIT JUNCTION HOLDINGS LLC | ||
| By: | /s/ Summit Junction Holdings LLC | |
[Signature Page to Asset Purchase Agreement]
Exhibit 10.2
PROMISSORY NOTE
| $10,000,000.00 | June 30, 2025 |
FOR VALUE RECEIVED, omniQ Corp., a Delaware corporation (the “Borrower”) hereby unconditionally promises to pay to the order of Summit Junction Holdings LLC, a Delaware limited liability company (the “Noteholder”) the principal amount of Ten Million United States Dollars $10,000,000.00 (the “Loan”), together with all accrued interest thereon, as provided in this Promissory Note (this “Note”).
1. Payment Dates.
(a) Payment Date. The aggregate unpaid principal amount of the Loan, all accrued and unpaid interest, and all other amounts payable under this Note shall be due and payable as set forth on Exhibit A hereto.
(b) Prepayment. The Borrower may prepay the Loan in whole or in part at any time or from time to time without penalty or premium by paying the principal amount to be prepaid together with accrued interest thereon to the date of the prepayment.
(c) No Reborrowing. Principal amounts repaid or prepaid may not be reborrowed.
2. Payment Mechanics.
(a) Manner of Payment. All payments of principal and interest shall be made in United States Dollars no later than 5:00pm PT on the date on which such payment is due as set forth on Exhibit A hereto. Such payments shall be made by wire transfer of immediately available funds to the Noteholder’s account at a bank specified by the Noteholder in writing to the Borrower from time to time.
(b) Application of Payments. All payments shall be applied, first, to fees or charges outstanding under this Note, second, to accrued interest, and, third, to principal outstanding under this Note.
(c) Business Day. Whenever any payment hereunder is due on a day that is not a Business Day, such payment shall be made on the next succeeding Business Day, and interest shall be calculated to include such extension. “Business Day” means a day other than Saturday, Sunday, or other day on which commercial banks in Las Vegas, Nevada are authorized or required by law to close.
3. Events of Default. The occurrence and continuance of any of the following shall constitute an “Event of Default” hereunder:
(a) Failure to Pay. The Borrower fails to pay (i) any principal amount of the Loan when due; (ii) any interest on the Loan within five (5) days after the date such amount is due; or (iii) any other amount due hereunder within ten (10) days after such amount is due.
(b) Bankruptcy; Insolvency.
(i) The Borrower institutes a voluntary case seeking relief under any law relating to bankruptcy, insolvency, reorganization, or other relief for debtors.
(ii) An involuntary case is commenced seeking the liquidation or reorganization of the Borrower under any law relating to bankruptcy or insolvency, and such case is not dismissed or vacated within sixty (60) days of its filing.
(iii) The Borrower makes a general assignment for the benefit of its creditors.
(iv) The Borrower is unable, or admits in writing its inability, to pay its debts as they become due.
(v) A case is commenced against the Borrower or its assets seeking attachment, execution, or similar process against all or a substantial part of its assets, and such case is not dismissed or vacated within sixty (60) days of its filing.
(c) Failure to Give Notice. The Borrower fails to give notice of an Event of Default under 4.
4. Notice of Event of Default. As soon as possible after it becomes aware that an Event of Default has occurred, and in any event within two (2) Business Days, the Borrower shall notify the Noteholder in writing of the nature and extent of such Event of Default and the action, if any, it has taken or proposes to take with respect to such Event of Default.
5. Remedies. Upon the occurrence and during the continuance of an Event of Default, the Noteholder may, at its option, by written notice to the Borrower declare the outstanding principal amount of the Loan, accrued and unpaid interest thereon, and all other amounts payable hereunder immediately due and payable.
6. Notices. All notices and other communications relating to this Note shall be in writing and shall be deemed given upon the first to occur of (x) deposit with the United States Postal Service or overnight courier service, properly addressed and postage prepaid; (y) transmittal by electronic communication (including email, internet or intranet websites, or facsimile properly addressed (with written acknowledgment from the intended recipient such as “return receipt requested” function, return e-mail, or other written acknowledgment)); or (z) actual receipt by an employee or agent of the other party. Notices hereunder shall be sent to the addresses set forth on the signature pages hereto, or to such other address as such party may specify in writing from time to time.
7. Governing Law. This Note and any claim, controversy, dispute, or cause of action (whether in contract, tort, or otherwise) based on, arising out of, or relating to this Note and the transactions contemplated hereby shall be governed by and construed in accordance with the laws of the State of Delaware.
8. Disputes.
(a) Submission to Jurisdiction. The Borrower irrevocably and unconditionally (A) agrees that any action, suit, or proceeding arising from or relating to this Note may be brought in the courts of the State of Delaware sitting in New Castle County, and in the United States District Court for the District of Delaware, and (B) submits to the exclusive jurisdiction of such courts in any such action, suit, or proceeding. Final judgment against the Borrower in any such action, suit, or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law.
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(b) Venue. The Borrower irrevocably and unconditionally waives, to the fullest extent permitted by law, (i) any objection that it may now or hereafter have to the laying of venue in any action, suit, or proceeding relating to this Note in any court referred to in Section 8(a), and (ii) the defense of inconvenient forum to the maintenance of such action, suit, or proceeding in any such court.
(c) Waiver of Jury Trial. THE BORROWER HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY RELATING TO THIS NOTE OR THE TRANSACTIONS CONTEMPLATED HEREBY, WHETHER BASED ON CONTRACT, TORT, OR ANY OTHER THEORY.
9. Successors and Assigns. This Note may be assigned or transferred by the Noteholder to any individual, corporation, company, limited liability company, trust, joint venture, association, partnership, unincorporated organization, governmental authority, or other entity.
10. Integration. This Note constitutes the entire contract between the Borrower and the Noteholder with respect to the subject matter hereof and supersedes all previous agreements and understandings, oral or written, with respect thereto.
11. Amendments and Waivers. No term of this Note may be waived, modified, or amended, except by an instrument in writing signed by the Borrower and the Noteholder. Any waiver of the terms hereof shall be effective only in the specific instance and for the specific purpose given.
12. No Waiver; Cumulative Remedies. No failure by the Noteholder to exercise and no delay in exercising any right, remedy, or power hereunder shall operate as a waiver thereof; nor shall any single or partial exercise of any right, remedy, or power hereunder preclude any other or further exercise thereof or the exercise of any other right, remedy, or power. The rights, remedies, and powers herein provided are cumulative and not exclusive of any other rights, remedies, or powers provided by law.
13. Severability. If any term or provision of this Note is invalid, illegal, or unenforceable in any jurisdiction, such invalidity, illegality, or unenforceability shall not affect any other term or provision of this Note or render such term or provision invalid or unenforceable in any other jurisdiction.
14. Counterparts. This Note and any amendments, waivers, consents, or supplements hereto may be executed in counterparts, each of which shall constitute an original, but all of which taken together shall constitute a single contract. Delivery of an executed counterpart of a signature page to this Note by facsimile or in electronic (“pdf” or “tif” or any other electronic means that reproduces an image of the actual executed signature page) format shall be as effective as delivery of a manually executed counterpart of this Note.
15. Electronic Execution. The words “execution,” “signed,” “signature,” and words of similar import in this Note shall be deemed to include electronic and digital signatures and the keeping of records in electronic form, each of which shall be of the same effect, validity, and enforceability as manually executed signatures and paper-based recordkeeping systems, to the extent and as provided for under applicable law, including the Electronic Signatures in Global and National Commerce Act (15 U.S.C. §§ 7001-7031), the Uniform Electronic Transactions Act (UETA), or any state law based on the UETA, including the New York Electronic Signatures and Records Act (N.Y. State Tech. §§ 301 to 309).
[signature page follows]
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IN WITNESS WHEREOF, the Borrower has executed this Note as of June 30, 2025.
| BORROWER: | ||
| OMNIQ CORP. | ||
| By | /s/ Shai Lustgarten | |
| Name: | Shai Lustgarten | |
| Title: | Chief Executive Officer | |
| By its acceptance of this Note, the Noteholder acknowledges and agrees to be bound by the provisions of this Note. | ||
| NOTEHOLDER: | ||
| SUMMIT JUNCTION HOLDINGS LLC | ||
| By | /s/ Summit Junction Holdings, LLC | |
[Signature Page to Promissory Note]
EXHIBIT A
PAYMENT SCHEDULE
| # | Payment | Interest | Principal | Balance | ||||||||||||||
| 1 | August 1, 2025 | $ | 106,065.52 | $ | 41,666.67 | $ | 64,398.85 | $ | 9,935,601.15 | |||||||||
| 2 | September 1, 2025 | $ | 106,065.52 | $ | 41,398.34 | $ | 64,667.18 | $ | 9,870,933.97 | |||||||||
| 3 | October 1, 2025 | $ | 106,065.52 | $ | 41,128.89 | $ | 64,936.63 | $ | 9,805,997.34 | |||||||||
| 4 | November 1, 2025 | $ | 106,065.52 | $ | 40,858.32 | $ | 65,207.20 | $ | 9,740,790.14 | |||||||||
| 5 | December 1, 2025 | $ | 106,065.52 | $ | 40,586.63 | $ | 65,478.89 | $ | 9,675,311.25 | |||||||||
| 6 | January 1, 2026 | $ | 106,065.52 | $ | 40,313.80 | $ | 65,751.72 | $ | 9,609,559.53 | |||||||||
| 7 | February 1, 2026 | $ | 106,065.52 | $ | 40,039.83 | $ | 66,025.69 | $ | 9,543,533.84 | |||||||||
| 8 | March 1, 2026 | $ | 106,065.52 | $ | 39,764.72 | $ | 66,300.80 | $ | 9,477,233.04 | |||||||||
| 9 | April 1, 2026 | $ | 106,065.52 | $ | 39,488.47 | $ | 66,577.05 | $ | 9,410,655.99 | |||||||||
| 10 | May 1, 2026 | $ | 106,065.52 | $ | 39,211.07 | $ | 66,854.45 | $ | 9,343,801.54 | |||||||||
| 11 | June 1, 2026 | $ | 106,065.52 | $ | 38,932.51 | $ | 67,133.01 | $ | 9,276,668.53 | |||||||||
| 12 | July 1, 2026 | $ | 212,131.04 | $ | 38,652.79 | $ | 173,478.25 | $ | 9,103,190.28 | |||||||||
| 13 | August 1, 2026 | $ | 106,065.52 | $ | 37,929.96 | $ | 68,135.56 | $ | 9,035,054.72 | |||||||||
| 14 | September 1, 2026 | $ | 106,065.52 | $ | 37,646.06 | $ | 68,419.46 | $ | 8,966,635.26 | |||||||||
| 15 | October 1, 2026 | $ | 106,065.52 | $ | 37,360.98 | $ | 68,704.54 | $ | 8,897,930.72 | |||||||||
| 16 | November 1, 2026 | $ | 106,065.52 | $ | 37,074.71 | $ | 68,990.81 | $ | 8,828,939.91 | |||||||||
| 17 | December 1, 2026 | $ | 106,065.52 | $ | 36,787.25 | $ | 69,278.27 | $ | 8,759,661.64 | |||||||||
| 18 | January 1, 2027 | $ | 106,065.52 | $ | 36,498.59 | $ | 69,566.93 | $ | 8,690,094.71 | |||||||||
| 19 | February 1, 2027 | $ | 106,065.52 | $ | 36,208.73 | $ | 69,856.79 | $ | 8,620,237.92 | |||||||||
| 20 | March 1, 2027 | $ | 106,065.52 | $ | 35,917.66 | $ | 70,147.86 | $ | 8,550,090.06 | |||||||||
| 21 | April 1, 2027 | $ | 106,065.52 | $ | 35,625.38 | $ | 70,440.14 | $ | 8,479,649.92 | |||||||||
| 22 | May 1, 2027 | $ | 106,065.52 | $ | 35,331.87 | $ | 70,733.65 | $ | 8,408,916.27 | |||||||||
| 23 | June 1, 2027 | $ | 106,065.52 | $ | 35,037.15 | $ | 71,028.37 | $ | 8,337,887.90 | |||||||||
| 24 | July 1, 2027 | $ | 212,131.04 | $ | 34,741.20 | $ | 177,389.84 | $ | 8,160,498.06 | |||||||||
| 25 | August 1, 2027 | $ | 106,065.52 | $ | 34,002.08 | $ | 72,063.44 | $ | 8,088,434.62 | |||||||||
| 26 | September 1, 2027 | $ | 106,065.52 | $ | 33,701.81 | $ | 72,363.71 | $ | 8,016,070.91 | |||||||||
| 27 | October 1, 2027 | $ | 106,065.52 | $ | 33,400.30 | $ | 72,665.22 | $ | 7,943,405.69 | |||||||||
| 28 | November 1, 2027 | $ | 106,065.52 | $ | 33,097.52 | $ | 72,968.00 | $ | 7,870,437.69 | |||||||||
| 29 | December 1, 2027 | $ | 106,065.52 | $ | 32,793.49 | $ | 73,272.03 | $ | 7,797,165.66 | |||||||||
| 30 | January 1, 2028 | $ | 106,065.52 | $ | 32,488.19 | $ | 73,577.33 | $ | 7,723,588.33 | |||||||||
| 31 | February 1, 2028 | $ | 106,065.52 | $ | 32,181.62 | $ | 73,883.90 | $ | 7,649,704.43 | |||||||||
| 32 | March 1, 2028 | $ | 106,065.52 | $ | 31,873.77 | $ | 74,191.75 | $ | 7,575,512.68 | |||||||||
| 33 | April 1, 2028 | $ | 106,065.52 | $ | 31,564.64 | $ | 74,500.88 | $ | 7,501,011.80 | |||||||||
| 34 | May 1, 2028 | $ | 106,065.52 | $ | 31,254.22 | $ | 74,811.30 | $ | 7,426,200.50 | |||||||||
| 35 | June 1, 2028 | $ | 106,065.52 | $ | 30,942.50 | $ | 75,123.02 | $ | 7,351,077.48 | |||||||||
| 36 | July 1, 2028 | $ | 212,131.04 | $ | 30,629.49 | $ | 181,501.55 | $ | 7,169,575.93 | |||||||||
| 37 | August 1, 2028 | $ | 7,199,449.16 | $ | 29,873.23 | $ | 7,169,575.93 | $ | - | |||||||||
Exhibit 10.6
TRANSITION SERVICES AGREEMENT
This Transition Services Agreement (this “Agreement”), dated as of June 30, 2025 (the “Effective Date”), is entered into between, on the one hand, OMNIQ Corp., a Delaware corporation (“Parent”), Quest Marketing, Inc., an Oregon corporation, HTS Image Processing, Inc., a Delaware corporation, OmniQ Vision Inc., a Delaware corporation, HTS Image Ltd, a company domiciled in Israel, OmniQ Technologies Ltd, a company domiciled in Israel and Dangot Computers, Ltd, a company domiciled in Israel (collectively, the “Subsidiaries”, the Subsidiaries together with Parent, “Sellers” and each, a “Seller”), and, on the other hand, Summit Junction Holdings LLC, a Delaware limited liability company (“Buyer”).
Recitals
WHEREAS, Buyer and Sellers have entered into that certain Asset Purchase Agreement, dated as of June 30, 2025 (the “Purchase Agreement”), pursuant to which Sellers have agreed to sell and assign to Buyer, and Buyer has agreed to purchase and assume from Seller, substantially all the assets, and certain specified liabilities, of the Business (as such term is defined in the Purchase Agreement), all as more fully described therein;
WHEREAS, in order to ensure an orderly transition of the Business to Buyer and as a condition to consummating the transactions contemplated by the Purchase Agreement, Buyer and Seller have agreed to enter into this Agreement, pursuant to which Parent will provide, or cause the Subsidiaries to provide, Buyer with certain services, in each case on a transitional basis and subject to the terms and conditions set forth herein;
WHEREAS, the Buyer has assumed the Assigned Contracts (as defined in the Purchase Agreement) and therefore the Buyer has assumed the contractual obligations of Seller in each case under the Assigned Contracts, and the Parties desire to have the Target Employees (as defined herein) provide services under such Assigned Contracts while remaining employees of the Seller in accordance with the terms hereof until the End Date;
WHEREAS, the Parties have also agreed that, subject to the terms and conditions contained herein, until the End Date (as defined below), Seller shall continue to employ the employees of the Business identified on Appendix 1 hereto (the employees identified on such exhibit as it may be amended or supplemented pursuant to the terms of this Agreement, the “Target Employees”) in accordance with the terms hereof; and
WHEREAS, capitalized terms used herein and not otherwise defined shall have the meaning ascribed to such terms in the Purchase Agreement.
NOW, THEREFORE, in consideration of the mutual agreements and covenants hereinafter set forth, Buyer and Sellers hereby agree as follows:
ARTICLE I
SERVICES
Section 1.01 Provision of Services.
(a) Sellers agree to provide the services (the “Services”) set forth on the exhibits attached hereto (as such exhibits may be amended or supplemented pursuant to the terms of this Agreement, collectively, the “Service Exhibits”) to Buyer for the respective periods and on the terms and conditions set forth in this Agreement and in the respective Service Exhibits.
(b) Notwithstanding the contents of the Service Exhibits, Sellers agree to respond in good faith to any reasonable request by Buyer for access to any additional services that are necessary for the operation of the Business and which are not currently contemplated in the Service Exhibits, at a price to be agreed upon after good faith negotiations between the parties. Any such additional services so provided by Sellers shall constitute Services under this Agreement and be subject in all respects to the provisions of this Agreement as if fully set forth on a Service Exhibit as of the date hereof. Notwithstanding any term of this Agreement or the Service Exhibits, in no event shall Seller be required to hire or employ any employees other than the Target Employees.
(c) The parties hereto acknowledge the transitional nature of the Services. Accordingly, as promptly as practicable following the execution of this Agreement, Buyer agrees to use commercially reasonable efforts to make a transition of each Service to its own internal organization or to obtain alternate third-party sources to provide the Services.
(d) Subject to Section 2.03, Section 2.04 and Section 3.05, the obligations of Sellers under this Agreement to provide Services shall terminate with respect to each Service on the end date specified in the applicable Service Exhibit (the “End Date”). Notwithstanding the foregoing, the parties acknowledge and agree that Buyer may determine from time to time that it does not require all the Services set out on one or more of the Service Exhibits or that it does not require such Services for the entire period up to the applicable End Date. Accordingly, Buyer may terminate any Service, in whole and not in part, upon notification to Sellers in writing of any such determination.
Section 1.02 Standard of Service.
(a) Sellers represent, warrant, and agree that the Services shall be provided in good faith, in accordance with Law, and, except as specifically provided in the Service Exhibits, in a manner generally consistent with the historical provision of the Services and with the same standard of care as historically provided. Subject to Section 1.03, Sellers agree to assign sufficient resources and qualified personnel as are reasonably required to perform the Services in accordance with the standards set forth in the preceding sentence.
(b) Except as expressly set forth in Section 1.02(a) or in any contract entered into hereunder, Sellers make no representations and warranties of any kind, implied or express, with respect to the Services, including, without limitation, no warranties of merchantability or fitness for a particular purpose, which are specifically disclaimed. Buyer acknowledges and agrees that this Agreement does not create a fiduciary relationship, partnership, joint venture, or relationship of trust or agency between the parties and that all Services are provided by Sellers as an independent contractor.
Section 1.03 Third-Party Service Providers. It is understood and agreed that Sellers have been retaining, and will continue to retain, third-party service providers to provide some of the Services to Buyer. In addition, Sellers shall have the right to hire other third-party subcontractors to provide all or part of any Service hereunder; provided, however, that in the event such subcontracting is inconsistent with past practices or such subcontractor is not already engaged with respect to such Service as of the date hereof, Sellers shall obtain the prior written consent of Buyer to hire such subcontractor, such consent not to be unreasonably withheld. Sellers shall in all cases retain responsibility for the provision to Buyer of Services to be performed by any third-party service provider or subcontractor or by any of the Subsidiaries.
Section 1.04 Access to Premises.
(a) In order to enable the provision of the Services by Sellers, Buyer agrees that it shall provide to Seller’s and its employees and any third-party service providers or subcontractors who provide Services, at no cost to Sellers, access to the facilities, assets, and books and records of the Business, in all cases to the extent necessary for Sellers to fulfill its obligations under this Agreement.
(b) Sellers agree that all of its employees and any third-party service providers and subcontractors, when on the property of Buyer or when given access to any equipment, computer, software, network, or files owned or controlled by Buyer, shall conform to the policies and procedures of Buyer concerning health, safety, and security which are made known to Sellers in advance in writing.
ARTICLE II
COMPENSATION
Section 2.01 Responsibility for Wages and Fees. For such time as any Target Employees are providing the Services to Buyer under this Agreement, (a) such Target Employees will remain employees of Sellers, as applicable, and shall not be deemed to be employees of Buyer for any purpose, and (b) subject to the terms of this Agreement, Sellers, as applicable, shall be solely responsible for the payment and provision of all wages, bonuses and commissions, employee benefits, including severance and worker’s compensation, and the withholding and payment of applicable Taxes relating to such employment until the sooner of (i) the End Date, or (ii) such time as the Target Employees are transitioned to Buyer.
Section 2.02 Terms of Payment and Related Matters.
(a) As consideration for provision of the Services, Buyer shall pay the amount specified for each Service to the Sellers identified on such Service’s respective Service Exhibit. In addition to such amount, in the event that Sellers incur reasonable and documented out-of-pocket expenses in the provision of any Service, including, without limitation, license fees and payments to third-party service providers or subcontractors, but excluding payments made to Target Employees of pursuant to Section 2.01 (such included expenses, collectively, “Out-of-Pocket Costs”), Buyer shall reimburse Sellers for all such Out-of-Pocket Costs in accordance with the invoicing procedures set forth in Section 2.02(b).
(b) As more fully provided in the Service Exhibits and subject to the terms and conditions therein:
(i) Sellers shall provide Buyer, in accordance with Section 6.01 of this Agreement, with monthly invoices (“Invoices”), which shall set forth in reasonable detail, with such supporting documentation as Buyer may reasonably request with respect to Out-of-Pocket Costs, amounts payable under this Agreement; and
(ii) payments pursuant to this Agreement shall be made within thirty (30) days after the date of receipt of an Invoice by Buyer from Sellers.
(c) It is the intent of the parties that the compensation set forth in the respective Service Exhibits reasonably approximates the cost of providing the Services, including the cost of employee wages and compensation, without any intent to cause Sellers to receive profit or incur loss. If at any time Sellers believes that the payments contemplated by a specific Service Exhibit are materially insufficient to compensate it for the cost of providing the Services it is obligated to provide hereunder, or Buyer believes that the payments contemplated by a specific Service Exhibit materially overcompensate Sellers for such Services, such party shall notify the other party as soon as possible, and the parties hereto will commence good faith negotiations toward an agreement in writing as to the appropriate course of action with respect to pricing of such Services for future periods.
Section 2.03 Extension of Services. The parties agree that Sellers shall not be obligated to perform any Service after the applicable End Date. If Buyer desires and Sellers agree to continue to perform any of the Services after the applicable End Date, the parties shall negotiate in good faith to determine an amount that compensates Sellers for all of its costs for such performance, including the time of its employees and its Out-of-Pocket Costs. The Services so performed by Sellers after the applicable End Date shall continue to constitute Services under this Agreement and be subject in all respects to the provisions of this Agreement for the duration of the agreed-upon extension period.
Section 2.04 Terminated Services. Upon termination or expiration of any or all Services pursuant to this Agreement, or upon the termination of this Agreement in its entirety, Sellers shall have no further obligation to provide the applicable terminated Services, and Buyer shall have no obligation to pay any future compensation or Out-of-Pocket Costs relating to such Services, other than for or in respect of Services already provided in accordance with the terms of this Agreement and received by Buyer prior to such termination.
Section 2.05 Invoice Disputes. In the event of an Invoice dispute, Buyer shall deliver a written statement to Sellers prior to the date payment is due on the disputed Invoice listing all disputed items and providing a reasonably detailed description of each disputed item. Amounts not so disputed shall be deemed accepted and shall be paid, notwithstanding disputes on other items, within the period set forth in Section 2.02(b). The parties shall seek to resolve all such disputes expeditiously and in good faith. Sellers shall continue performing the Services in accordance with this Agreement pending resolution of any dispute.
Section 2.06 No Right of Setoff. Each of the parties hereby acknowledges that it shall have no right under this Agreement to setoff any amounts owed (or to become due and owing) to the other party, whether under this Agreement, the Purchase Agreement or otherwise, against any other amount owed (or to become due and owing) to it by the other party.
Section 2.07 Taxes. Buyer shall be responsible for all sales or use Taxes imposed or assessed as a result of the provision of Services by Sellers.
ARTICLE III
TERMINATION
Section 3.01 Termination of Agreement. Subject to Section 3.04, this Agreement shall terminate in its entirety (i) on the date upon which Sellers shall have no continuing obligation to perform any Services as a result of each of their expiration or termination in accordance with Section 1.01(d) or Section 3.02 or (ii) in accordance with Section 3.03.
Section 3.02 Breach. Any party (the “Non-Breaching Party”) may terminate this Agreement with respect to any Service, in whole but not in part, at any time upon prior written notice to the other party (the “Breaching Party”) if the Breaching Party has failed (other than pursuant to Section 3.05) to perform any of its material obligations under this Agreement relating to such Service, and such failure shall have continued without cure for a period of fifteen (15) days after receipt by the Breaching Party of a written notice of such failure from the Non- Breaching party seeking to terminate such service. For the avoidance of doubt, non-payment by Buyer for a Service provided by Seller(s) in accordance with this Agreement and not the subject of a good-faith dispute shall be deemed a breach for purposes of this Section 3.02.
Section 3.03 Insolvency. In the event that either party hereto shall (i) file a petition in bankruptcy, (ii) become or be declared insolvent, or become the subject of any proceedings (not dismissed within sixty (60) days) related to its liquidation, insolvency, or the appointment of a receiver, (iii) make an assignment on behalf of all or substantially all of its creditors, or (iv) take any corporate action for its winding up or dissolution, then the other party shall have the right to terminate this Agreement by providing written notice in accordance with Section 6.01.
Section 3.04 Effect of Termination. Upon termination of this Agreement in its entirety pursuant to Section 3.01, all obligations of the parties hereto shall terminate, except for the provisions of Section 2.04, Section 2.06, Section 2.07, ARTICLE IV, ARTICLE V and ARTICLE VI, which shall survive any termination or expiration of this Agreement.
Section 3.05 Force Majeure. The obligations of Seller(s) under this Agreement with respect to any Service shall be suspended during the period and to the extent that Seller(s) is prevented or hindered from providing such Service, or Buyer is prevented or hindered from receiving such Service, due to any of the following causes beyond such party’s reasonable control (such causes, “Force Majeure Events”): (i) acts of God, (ii) flood, fire, or explosion, (iii) war, invasion, riot, or other civil unrest, (iv) Governmental Order or Law, (v) actions, embargoes, or blockades in effect on or after the date of this Agreement, (vi) action by any Governmental Authority, (vii) national or regional emergency, (viii) strikes, labor stoppages or slowdowns or other industrial disturbances, (ix) shortage of adequate power or transportation facilities, (x) pandemics, or (xi) any other event which is beyond the reasonable control of such party. The party suffering a Force Majeure Event shall give notice of suspension as soon as reasonably practicable to the other party stating the date and extent of such suspension and the cause thereof, and Seller(s) shall resume the performance of its obligations as soon as reasonably practicable after the removal of the cause. Neither Buyer nor Seller(s) shall be liable for the nonperformance or delay in performance of its respective obligations under this Agreement when such failure is due to a Force Majeure Event. The applicable End Date for any Service so suspended shall be automatically extended for a period of time equal to the time lost by reason of the suspension.
ARTICLE IV
CONFIDENTIALITY
Section 4.01 Confidentiality.
(a) During the term of this Agreement and thereafter, the parties hereto shall, and shall instruct their respective Representatives to, maintain in confidence and not disclose the other party’s financial, technical, sales, marketing, development, personnel, and other information, records, or data, including, without limitation, customer lists, supplier lists, trade secrets, designs, product formulations, product specifications, or any other proprietary or confidential information, however recorded or preserved, whether written or oral (any such information, “Confidential Information”). Each party hereto shall use the same degree of care, but no less than reasonable care, to protect the other party’s Confidential Information as it uses to protect its own Confidential Information of like nature. Unless otherwise authorized in any other agreement between the parties, any party receiving any Confidential Information of the other party (the “Receiving Party”) may use Confidential Information only for the purposes of fulfilling its obligations under this Agreement (the “Permitted Purpose”). Any Receiving Party may disclose such Confidential Information only to its Representatives who have a need to know such information for the Permitted Purpose and who have been advised of the terms of this Section 4.01, and the Receiving Party shall be liable for any breach of these confidentiality provisions by such Persons. Any Receiving Party may disclose such Confidential Information to the extent such Confidential Information is required to be disclosed by a Governmental Order, in which case the Receiving Party shall promptly notify, to the extent possible, the disclosing party (the “Disclosing Party”), and take reasonable steps to assist in contesting such Governmental Order or in protecting the Disclosing Party’s rights prior to disclosure, and in which case the Receiving Party shall only disclose such Confidential Information that it is advised by its counsel in writing that it is legally bound to disclose under such Governmental Order.
(b) Notwithstanding the foregoing, “Confidential Information” shall not include any information that the Receiving Party can demonstrate: (i) was publicly known at the time of disclosure to it, or has become publicly known through no act of the Receiving Party or its Representatives in breach of this Section 4.01; (ii) was rightfully received from a third party without a duty of confidentiality; or (iii) was developed by it independently without any reliance on the Confidential Information.
(c) Upon demand by the Disclosing Party at any time, or upon expiration or termination of this Agreement with respect to any Service, the Receiving Party agrees promptly to return or destroy, at the Disclosing Party’s option, all Confidential Information. If such Confidential Information is destroyed, an authorized officer of the Receiving Party shall certify to such destruction in writing.
ARTICLE V
LIMITATION ON LIABILITY; INDEMNIFICATION
Section 5.01 Limitation on Liability. In no event shall Sellers have any liability under any provision of this Agreement for any punitive, incidental, consequential, special, or indirect damages, including loss of future revenue or income, loss of business reputation, or opportunity relating to the breach or alleged breach of this Agreement, or diminution of value or any damages based on any type of multiple, whether based on statute, contract, tort, or otherwise, and whether or not arising from the other party’s sole, joint, or concurrent negligence, strict liability, criminal liability, or other fault. Buyer acknowledges that the Services to be provided to it hereunder are subject to, and that its remedies under this Agreement are limited by, the applicable provisions of Section 1.02, including the limitations on representations and warranties with respect to the Services.
Section 5.02 Indemnification. Subject to the limitations set forth in Section 5.01, Seller shall indemnify, defend, and hold harmless Buyer and its Affiliates and each of their respective Representatives (collectively, the “Buyer Indemnified Parties”) from and against any and all Losses of the Buyer Indemnified Parties relating to, arising out of or resulting from the gross negligence or willful misconduct of Sellers or any third party that provides a Service to Buyer pursuant to Section 1.03 in connection with the provision of, or failure to provide, any Services to Buyer.
Section 5.03 Indemnification Procedures The matters set forth in ARTICLE VI of the Purchase Agreement shall be deemed incorporated into, and made a part of, this Agreement.
ARTICLE VI
MISCELLANEOUS
Section 6.01 Notices. All Invoices, notices, requests, consents, claims, demands, waivers, and other communications hereunder shall be in writing and shall be deemed to have been given: (a) when delivered by hand (with written confirmation of receipt); (b) when received by the addressee if sent by a nationally recognized overnight courier (receipt requested); (c) on the date sent by facsimile or email of a PDF document (with confirmation of transmission) if sent during normal business hours of the recipient, and on the next business day if sent after normal business hours of the recipient; or (d) on the third day after the date mailed, by certified or registered mail, return receipt requested, postage prepaid. Such communications must be sent to the respective parties at the addresses set forth in the Purchase Agreement (or at such other address for a party as shall be specified in a notice given in accordance with this Section 6.01).
Section 6.02 Headings. The headings in this Agreement are for reference only and shall not affect the interpretation of this Agreement.
Section 6.03 Severability. If any term or provision of this Agreement is invalid, illegal, or unenforceable in any jurisdiction, such invalidity, illegality, or unenforceability shall not affect any other term or provision of this Agreement or invalidate or render unenforceable such term or provision in any other jurisdiction. Upon such determination that any term or other provision is invalid, illegal, or unenforceable, the parties hereto shall negotiate in good faith to modify this Agreement so as to effect the original intent of the parties as closely as possible in a mutually acceptable manner in order that the transactions contemplated hereby be consummated as originally contemplated to the greatest extent possible.
Section 6.04 Entire Agreement. This Agreement, including all Service Exhibits, constitutes the sole and entire agreement of the parties to this Agreement with respect to the subject matter contained herein and supersedes all prior and contemporaneous understandings and agreements, both written and oral, with respect to such subject matter. In the event and to the extent that there is a conflict between the provisions of this Agreement and the provisions of the Purchase Agreement as it relates to the Services hereunder, the provisions of this Agreement shall control.
Section 6.05 Successors and Assigns. This Agreement shall be binding upon and shall inure to the benefit of the parties hereto and their respective successors and permitted assigns. Subject to the following sentence, neither party may assign its rights or obligations hereunder without the prior written consent of the other party, which consent shall not be unreasonably withheld or delayed. Notwithstanding the foregoing sentence, Buyer may, without the prior written consent of Seller, assign all or any portion of its right to receive Services to any of its Affiliates that participate in the operation of the Business; provided, that such Affiliate shall receive such Services from Seller in the same place and manner as described in the respective Service Exhibit as Buyer would have received such Service. No assignment shall relieve the assigning party of any of its obligations hereunder.
Section 6.06 No Third-Party Beneficiaries. This Agreement is for the sole benefit of the parties hereto and their respective successors and permitted assigns and nothing herein, express or implied, is intended to or shall confer upon any other Person any legal or equitable right, benefit, or remedy of any nature whatsoever, under or by reason of this Agreement.
Section 6.07 Amendment and Modification; Waiver. This Agreement may only be amended, modified, or supplemented by an agreement in writing signed by each party hereto. No waiver by any party of any of the provisions hereof shall be effective unless explicitly set forth in writing and signed by the party so waiving. No failure to exercise, or delay in exercising, any right, remedy, power, or privilege arising from this Agreement shall operate or be construed as a waiver thereof; nor shall any single or partial exercise of any right, remedy, power, or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, remedy, power, or privilege.
Section 6.08 Governing Law; Submission to Jurisdiction. This Agreement shall be governed by and construed in accordance with the internal laws of the State of Delaware without giving effect to any choice or conflict of law provision or rule (whether of the State of Delaware or any other jurisdiction) that would cause the application of Laws of any jurisdiction other than those of the State of Delaware. Any legal suit, action, or proceeding arising out of or based upon this agreement or the transactions contemplated hereby may be instituted in the federal courts of the United States of America or the courts of the state of Delaware in each case located in the city of Wilmington, and each party irrevocably submits to the exclusive jurisdiction of such courts in any such suit, action, or proceeding. Service of process, summons, notice, or other document by mail to such party’s address set forth herein shall be effective service of process for any suit, action, or other proceeding brought in any such court. The parties irrevocably and unconditionally waive any objection to the laying of venue of any suit, action, or proceeding in such courts and irrevocably waive and agree not to plead or claim in any such court that any such suit, action, or proceeding brought in any such court has been brought in an inconvenient forum.
Section 6.09 Waiver of Jury Trial. Each party irrevocably and unconditionally waives any right it may have to a trial by jury in respect of any legal action arising out of or relating to this agreement or the transactions contemplated hereby. Each party to this agreement certifies and acknowledges that (a) no representative of any other party has represented, expressly or otherwise, that such other party would not seek to enforce the foregoing waiver in the event of a legal action, (b) such party has considered the implications of this waiver, (c) such party makes this waiver voluntarily, and (d) such party has been induced to enter into this agreement by, among other things, the mutual waivers and certifications in this Section 6.09.
Section 6.10 Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original, but all of which together shall be deemed to be one and the same agreement. A signed copy of this Agreement delivered by e-mail, or other means of electronic transmission shall be deemed to have the same legal effect as delivery of an original signed copy of this Agreement.
[SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the date first written above by their respective officers thereunto duly authorized.
| BUYER: | ||
| SUMMIT JUNCTION HOLDINGS LLC | ||
| By | /s/ Summit Junction Holdings LLC | |
| SELLERS: | ||
| OMNIQ CORP. | ||
| QUEST MARKETING, INC. | ||
| HTS IMAGE PROCESSING, INC. OMNIQ VISION INC. | ||
| HTS IMAGE LTD. | ||
| OMNIQ TECHNOLOGIES LTD DANGOT COMPUTERS, LTD | ||
| By | /s/ Shai Lustgarten | |
| Name: | Shai Lustgarten | |
| Title: | Chief Executive Officer | |
[Signature Page to Transition Services Agreement]
Service Exhibit A
Employee Maintenance and Payroll Process Services
| Section 1 | Seller Responsibilities. |
(a) For such time as the Target Employees are providing Services to the Buyer under this Agreement, the Target Employees will remain employees of Sellers, and shall be subject to day-to-day instruction, dominion, direction, and control of Sellers (with Sellers retaining authority to implement the discharge and discipline of the Target Employees), and shall therefore be deemed to be employees of Sellers, and Sellers shall be solely responsible for: (i) compliance with wage and hour laws (including minimum wage and overtime requirements), applicable federal, state, and local employment laws, applicable licensure requirements, and immigration, work eligibility and other laws; and (ii) the payment and provision of all wages, bonuses and commissions, paid leave, reimbursement of costs, employee benefits, workers compensation and unemployment insurance in amounts required by law (and handling workers compensation and unemployment insurance claims by Target Employees), maintenance of employment-related records as required by law, withholding, payment, and remittance of applicable employee benefit contributions, and the withholding, reporting, remitting, and payment of applicable Taxes relating to such employment (including, without limitation, applicable federal and state income taxes, FICA, FUTA, and SUTA), which payments the Buyer will fund as set forth in Section 2 of this Service Exhibit. For the avoidance of doubt, notwithstanding anything to the contrary, nothing in this Agreement shall be construed as guaranteeing employment to any Target Employee.
(b) The Parties acknowledge and agree that Sellers may determine that it is necessary or advisable to hire one or more additional employees to furnish Services to the Buyer under this Agreement, to terminate one or more Target Employees, or to replace one or more Target Employees who cease employment with Sellers by hiring another employee. Any such decision to hire or terminate any employee of Sellers (including any Target Employee) and the terms of employment for any new employee hired by Sellers after the Effective Date shall be in the discretion of Sellers; provided, however, before hiring any such new employee who would furnish Services to the Buyer under this Agreement or terminating any Target Employee, Sellers shall consult in good faith with and obtain the prior written consent, not to be unreasonably conditioned, delayed, or withheld, of the Buyer regarding the proposed hire of the new employee and the terms of his or her employment with Sellers or the termination of such Target Employee. Sellers agree to provide prompt notice to the Buyer of any Target Employee who ceases such Target Employee’s employment with Sellers after the Effective Date. Any such new employee hired by Sellers after the Effective Date in accordance with this Agreement shall constitute a Target Employee under this Agreement effective as of such new employee’s hire date and any Target Employee who ceases employment with the Sellers after the Effective Date shall no longer constitute a Target Employee under this Agreement effective after such terminated employee’s termination date, and Appendix 1 attached hereto shall be deemed amended from time to time to give effect to the foregoing.
(c) Sellers shall maintain adequate personnel records and related employment documentation pertaining to the allocation of the Target Employees’ time committed to Buyer (where applicable) and make all of its records pertaining to Target Employees available upon request.
(d) Sellers shall report promptly to Buyer any serious accidents or injuries, any reported illegal activity, any significant disciplinary matters, and any alleged violations of employment policies regarding equal employment opportunity, confidentiality, or conflict of interest by the Target Employees of which Sellers become aware.
(e) Sellers shall keep in full force and effect workers’ compensation and unemployment insurances covering the Target Employees, and, upon written request of Buyer, furnish a certificate of insurance verifying coverage.
| Section 2 | Service Fee. |
As compensation for the above Services, the Buyer shall pay the Sellers a service fee equal to the sum of the following three items:
(a) Wages. Subject to the other provisions of this Agreement, Sellers acknowledges and agrees that it alone is responsible for and will pay all wages, salaries, bonuses, commissions, and per diems, at the rates in effect as of the Effective Date of this Agreement with respect to Target Employees as of the Effective Date and, consistent with Seller’s payroll practices and upon prior written approval of the Buyer (not to be unreasonably withheld, conditioned or delayed), as may be revised from time to time during the term of this Agreement and at the rates agreed to by Sellers for new Target Employees employed by Sellers after the Effective Date, and associated federal, state and local payroll taxes, Social Security and any amounts payable under unemployment compensation or workers’ compensation laws related to or associated with the employment of the Target Employees during the term of this Agreement. With respect to wages payable by Sellers hereunder, Sellers shall make the appropriate withholdings and will timely pay such net wages directly to the Target Employees. Sellers shall withhold appropriate amounts associated with the Seller’s benefit plans for Target Employees in order to continue coverage of such plans during the term and shall remit the applicable amounts to the third-party insurers, administrators or fiduciaries as required by such benefit plans and by law. With respect to taxes and other amounts due to governmental third parties for gross wages of Target Employees payable by Sellers hereunder, Sellers shall similarly remit amounts due within the time frames and other parameters required by law. The Buyer agrees to pay the full amount of all wages and other payments required to be made by the Sellers, including any taxes or other costs related thereto, pursuant to the preceding sentences into an account controlled by the Sellers no later than two (2) business days prior to the effective date of such payroll. No later than five (5) business days prior to the date of such payment, Sellers shall provide the Buyer with the necessary information for such payments.
(b) Employee Benefits. The Buyer shall fully reimburse Sellers for all benefits costs, including without limitation claim costs, premium costs (including premium equivalent costs) and costs of administration paid by Sellers with respect to all employee benefits and fringe benefits provided by Sellers to the Target Employees. For the avoidance of doubt, without limiting the generality of the foregoing, the Buyer agrees to reimburse Sellers for the portion of any cash payout of vacation time/paid time off paid by Sellers under its employee benefit plans to the Target Employees related to or associated with the employment of the Target Employees during the term of this Agreement, and associated federal, state and local payroll taxes, Social Security and any amounts payable under unemployment compensation or workers’ compensation laws related to the same, to the extent such vacation time / paid time off was earned during the term of this Agreement. Sellers agree to provide a statement to the Buyer for each pay period in which Sellers incurs any costs in connection with the foregoing indicating the costs incurred by Sellers for such pay period, together with reasonable detail supporting such costs, and the Buyer agrees to pay the full amount of all payments required to be made by Sellers, including any taxes or other costs related thereto, into an account controlled by Seller within five (5) business days of its receipt of the statement. Notwithstanding the foregoing, the Buyer agrees to pay the full amount of all payments, including but not limited to cash payout of vacation time/paid time off and associated taxes, unemployment insurance premiums, mandated benefits costs, and employer contributions to insurance premiums, that arise in connection with the payroll for a particular pay period no later than two (2) business days prior to the payroll check date for such pay period.
(c) Indirect Expenses. It is the intent of the Parties that Sellers not incur any expense or liability under this Agreement as a result of continuing the employment of the Target Employees and operation of the Business and provision of the Services through the End Date, and the Buyer shall reimburse Sellers for all other reasonable and documented expenses paid by Sellers as a result of continuing the employment of the Target Employees, operation of the Business and provision of the Services through the End Date (all of such expenses, collectively, the “Indirect Expenses”). For the avoidance of doubt, without limiting the generality of the foregoing, (a) any and all insurance policies that Sellers maintained prior to the Closing Date and continues to maintain in accordance with its continued operation of the Business shall be considered Indirect Expenses and the Buyer agrees that it shall reimburse any premiums or other costs or liabilities associated with such insurance policies as they come due (including, without limitation, any true-up payments required to be paid by Sellers (whether during or after the End Date and whether resulting from any premium adjustment at the end of the policy term, audit, or otherwise) with respect to any workers compensation policies related to or associated with the employment of the Target Employees during the term of this Agreement); and (b) any travel expenses, out-of-town hotel/lodging expenses and other reimbursable employee expenses incurred by a Target Employee in connection with the provision of Services for the benefit of the Buyer under this Agreement and reimbursed by Sellers shall be considered Indirect Expenses and the Buyer agrees that it shall reimburse Sellers for all such expenses.
Section 3 Accounting and Time Entry System. Sellers shall continue to maintain the accounting and time entry system in use by Sellers on the Effective Date through the End Date. All costs and expenses incurred by Sellers to maintain the accounting and time entry system during the term of this Service Exhibit A shall be Out-of-Pocket Costs reimbursable pursuant to Section 2.02 of the Agreement.
Service Exhibit B
IT Services and Insurance
| Section 1 | IT Services. |
| (a) | Seller Responsibilities. |
(i) For a period beginning at Closing and continuing until the later of (1) twelve (12) months following Closing or (2) the date Buyer obtains the services enumerated below, respectively, Sellers shall cause the following products and services to be made available for Buyer’s use:
(A) Cell phones and cell phone service;
(B) Microsoft Office and related Microsoft software and services; and
(C) Any and all communication services, including but not limited to those provided through 013, Zoom, or Apple, maintained by Sellers and customarily used by Sellers’ employees.
(ii) Sellers shall cause the above Services to be made available to Buyer in the same manner and subject to the same terms and conditions as such services have been customarily provided to Sellers’ employees prior to Closing, or as may be otherwise mutually agreed upon by Buyer and Sellers.
| (b) | Service Fee. |
(i) As compensation for the above Services, the Buyer shall pay the Sellers a service fee equal to one half of the cost of providing such services to the Buyer, which cost shall be reasonable and customary. No later than five (5) business days prior to the date of such payment, Sellers shall provide the Buyer with the necessary information for such payments.
| Section 2 | Insurance. |
| (a) | Seller Responsibilities. |
(i) For a period beginning at Closing and continuing until Buyer obtains such insurance coverage that it deems, in its sole discretion, satisfactory, Sellers shall continue to maintain the following insurance coverage and shall make the same coverage available to Buyer:
(A) Products and services liability insurance; and
(B) Directors’ and officers’ liability insurance.
(ii) Sellers shall maintain and cause the above insurance coverage to be made available to Buyer in the same manner and subject to the same terms and conditions as such coverage has been maintained and made available by Sellers prior to Closing, or as may be otherwise mutually agreed upon by Buyer and Sellers.
| (b) | Service Fee. |
(i) As compensation for the above Services, the Buyer shall pay the Sellers a service fee equal to one half of the cost of providing such coverage to the Buyer. Such costs shall be limited to (1) premiums, (2) deductibles, and (3) fees reasonably and customarily charged by the respective insurers to the Sellers for providing such coverage. No later than five (5) business days prior to the date of such payment, Sellers shall provide the Buyer with the necessary information for such payments.
Exhibit 10.10
CONVERSION
AGREEMENT
This Conversion Agreement (“Agreement”) is entered into and made effective as of July 10, 2025 (the “Effective Date”), by and between:
OMNIQ
Corp, a Delaware corporation, with its principal office located at 1865 West 2100 South, Salt Lake City, UT 84119 (the
“Company”), and
Shai Lustgarten, an individual who holds the title of Chief Executive Officer (“Officer”) of the Company.
RECITALS
WHEREAS, the Company is in the process of eliminating as much of its debt as possible;
WHEREAS, the Company is indebted to Officer in the amount of $31,500 for unpaid salary and unreimbursed business expenses (the “Debt”); and
WHEREAS, Officer has agreed to convert the Debt into shares of the Company’s common stock, par value $$0.001 per share (the “Common Stock”), in accordance with the terms and conditions of this Agreement;
NOW, THEREFORE, in consideration of the foregoing and the mutual covenants and promises contained herein, the parties agree as follows:
1. Conversion of Debt
1.1 Conversion Amount. The Company hereby agrees to convert the total amount of $31,500 of Debt owed to Officer into shares of its Common Stock.
1.2 Conversion Price. The conversion shall be at a price of $$0.07 per share (the “Conversion Price”) which reflects an approximate 15% premium to the current market price of the Company’s common stock, resulting in the issuance of 450,000 shares of Common Stock to Officer.
1.3 Issuance of Shares. Within 5 business days of the Effective Date, the Company shall issue to Officer a stock certificate (or book-entry notation) representing the shares of Common Stock to be issued pursuant to this Agreement.
2. Representations and Warranties
2.1 By Officer. Officer represents and warrants to the Company that:
| ● | (a) He is the sole legal and beneficial owner of the Debt; | |
| ● | (b) He has the full right, power, and authority to enter into and perform this Agreement; | |
| ● | (c) He is acquiring the Common Stock for investment purposes only and not with a view toward resale or distribution, unless pursuant to a valid registration or exemption under applicable securities laws. | |
| ● | (d) He recognizes that the Common Stock will bear a restrictive legend and shall not be available for resale unless it is registered in a registration statement under the Act or a valid exemption. |
2.2 By Company. The Company represents and warrants to Officer that:
| ● | (a) The issuance of the Common Stock has been duly authorized by all necessary corporate action; | |
| ● | (b) The shares to be issued pursuant to this Agreement will be validly issued, fully paid, and non-assessable. |
3. Miscellaneous
3.1 Entire Agreement. This Agreement contains the entire understanding of the parties and supersedes all prior discussions and agreements relating to the subject matter hereof.
3.2 Amendment. No modification or amendment of this Agreement shall be valid unless in writing and signed by both parties.
3.3 Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Delaware, without regard to its conflict of law provisions.
3.4 Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original, and all of which together shall constitute one instrument.
3.5 Tax Consequences. Officer acknowledges and agrees that the Company has made no representations regarding the tax consequences of the conversion and that Officer has had the opportunity to consult with his/her own tax advisor.
IN WITNESS WHEREOF, the parties have executed this Conversion Agreement as of the Effective Date.
| OMNIQ CORP. | ||
| By: | /s/ Shai Lustgarten | |
| Name: | Shai Lustgarten | |
| Title: | Chief Executive Officer | |
| Officer | ||
| By: | /s/ Shai Lustgarten | |
| Name: | Shai Lustgarten | |
Exhibit 99.1
Proforma Financial Statements for December 31, 2024 and three months ending March 31, 2025
OMNIQ CORP.
Unaudited Pro Forma Condensed Consolidated Balance Sheet
(In thousands)
| As of March 31, 2025 | ||||||||||||
| Pro Forma | ||||||||||||
| As Reported | Adjustments | Pro Forma | ||||||||||
| ASSETS | ||||||||||||
| Current assets | ||||||||||||
| Cash and cash equivalents | $ | 2,712 | $ | (2,000 | )a | $ | 712 | |||||
| Accounts receivable, net | 15,798 | (6,898 | )b | 8,900 | ||||||||
| Inventory | 4,326 | (1,510 | )b | 2,816 | ||||||||
| Prepaid expenses | 1,089 | (644 | )b | 445 | ||||||||
| Other current assets | 103 | (64 | )b | 39 | ||||||||
| Total current assets | 24,028 | (11,116 | ) | 12,912 | ||||||||
| Property and equipment, net of accumulated depreciation, net | 684 | (5 | )b | 679 | ||||||||
| Goodwill | 2,862 | - | 2,862 | |||||||||
| Trade name, net of accumulated amortization, net | 1,120 | - | 1,120 | |||||||||
| Customer relationships, net of accumulated amortization, net | 2,909 | - | 2,909 | |||||||||
| Other intangibles, net of accumulated amortization, net | 384 | - | 384 | |||||||||
| Right of use lease asset | 884 | (401 | )b | 483 | ||||||||
| Other assets | 2,239 | - | 2,239 | |||||||||
| Total Assets | $ | 35,110 | $ | (11,522 | ) | $ | 23,588 | |||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||||||
| Current liabilities | ||||||||||||
| Accounts payable and accrued liabilities | $ | 64,850 | $ | (56,598 | )b | $ | 8,252 | |||||
| Line of credit | 269 | - | 269 | |||||||||
| Accrued payroll and sales tax | 2,774 | (1,255 | )b | 1,519 | ||||||||
| Notes payable – current portion | 7,857 | - | 7,857 | |||||||||
| Lease liability – current portion | 632 | (315 | )b | 317 | ||||||||
| Other current liabilities | 2,808 | (1,280 | )b | 1,528 | ||||||||
| Total current liabilities | 79,190 | (59,448 | ) | 19,742 | ||||||||
| Long-term liabilities | ||||||||||||
| Accrued interest and accrued liabilities, related party | 73 | - | 73 | |||||||||
| Notes payable, less current portion | 644 | (801 | )b | (157 | ) | |||||||
| Lease liability | 225 | (98 | )b | 127 | ||||||||
| Other long-term liabilities | 469 | 10,000 | c | 10,469 | ||||||||
| Total liabilities | 80,601 | (50,347 | ) | 30,254 | ||||||||
| Stockholders’ equity (deficit) | ||||||||||||
| Series C Preferred stock; $0.001 par value | 1 | - | 1 | |||||||||
| Common stock; $0.001 par value | 11 | - | 11 | |||||||||
| Additional paid-in capital | 78,715 | - | 78,715 | |||||||||
| Accumulated (deficit) | (125,995 | ) | 38,825 | d | (87,170 | ) | ||||||
| Accumulated other comprehensive income | 1,777 | - | 1,777 | |||||||||
| Total OmniQ stockholders’ equity (deficit) | (45,491 | ) | 38,825 | (6,666 | ) | |||||||
| Total liabilities and equity (deficit) | $ | 35,110 | $ | (11,522 | ) | $ | 23,588 | |||||
OMNIQ CORP.
Unaudited Pro Forma Condensed Consolidated Statement of Loss
(In thousands, except per-share amounts)
| For the 3 months ended March 31, 2025 | ||||||||||||
| Pro Forma | ||||||||||||
| (In thousands, except share and per share data) | As Reported | Adjustments | Pro Forma | |||||||||
| Revenues | $ | 19,903 | $ | (11,924 | )e | $ | 7,979 | |||||
| Cost of goods sold | 14,762 | (8,966 | )e | 5,796 | ||||||||
| Gross profit | 5,141 | (2,958 | )e | 2,183 | ||||||||
| Operating expenses | ||||||||||||
| Research & Development | 507 | (22 | )e | 485 | ||||||||
| Selling, general and administrative | 5,064 | (3,198 | )e | 1,866 | ||||||||
| Depreciation | 28 | (2 | )e | 26 | ||||||||
| Amortization | 232 | - | 232 | |||||||||
| Total operating expenses | 5,831 | (3,222 | ) | 2,609 | ||||||||
| Loss from operations | (690 | ) | 264 | (426 | ) | |||||||
| Other income (expenses): | ||||||||||||
| Interest expense | (462 | ) | 202 | e | (260 | ) | ||||||
| Other (expenses) income | (973 | ) | 31 | e | (942 | ) | ||||||
| Gain on sale | - | 38,574 | 38,574 | |||||||||
| Total other expenses | (1,435 | ) | 38,807 | 37,372 | ||||||||
| Net Loss Before income Taxes | (2,125 | ) | 39,071 | 36,946 | ||||||||
| Provision for Income Taxes | ||||||||||||
| Current | 36 | - | g | 36 | ||||||||
| Total Provision for Income Taxes | 36 | - | 36 | |||||||||
| Net (Loss) Income | $ | (2,089 | ) | $ | 39,071 | $ | 36,982 | |||||
NOTES TO THE UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
The following items resulted in adjustments in the unaudited pro form condensed consolidated financial information:
| a) | Adjustment represents cash transferred to buyer as part of the transaction. | |
| b) | Adjustment represent the elimination of assets and liabilities sold. | |
| c) | Adjustment represents the note payable issued to the buyer. | |
| d) | Adjustment represents the elimination of net assets sold. | |
| e) | Adjustments reflect the elimination of revenue, costs, and expenses directly attributed to the assets and liabilities sold. | |
| f) | Adjustment reflects the approximate gain on sale of assets and liabilities calculated as follows: |
| Cash paid to buyer | $ | (2,000 | ) | |
| Notes payable issued to buyer | (10,000 | ) | ||
| Less: Carrying value of the sold net assets | 50,825 | |||
| Pro forma net gain on sale | $ | 38,825 |
| g) | Because the entity has sufficient net-operating loss carryforwards, we don’t anticipate a material tax effect. |
OMNIQ CORP.
Unaudited Pro Forma Condensed Consolidated Balance Sheet
(In thousands)
| As of December 31, 2024 | ||||||||||||
| Pro Forma | ||||||||||||
| As Reported | Adjustments | Pro Forma | ||||||||||
| ASSETS | ||||||||||||
| Current assets | ||||||||||||
| Cash and cash equivalents | $ | 2,349 | $ | - | $ | 2,349 | ||||||
| Accounts receivable, net | 20,945 | (10,608 | )a | 10,337 | ||||||||
| Inventory | 7,405 | (4,197 | )a | 3,208 | ||||||||
| Prepaid expenses | 1,085 | (482 | )a | 603 | ||||||||
| Other current assets | 96 | (61 | )a | 35 | ||||||||
| Total current assets | 31,880 | (15,348 | ) | 16,532 | ||||||||
| Property and equipment, net of accumulated depreciation, net | 721 | (8 | )a | 713 | ||||||||
| Goodwill | 2,918 | - | 2,918 | |||||||||
| Trade name, net of accumulated amortization, net | 1,187 | - | 1,187 | |||||||||
| Customer relationships, net of accumulated amortization, net | 3,115 | - | 3,115 | |||||||||
| Other intangibles, net of accumulated amortization, net | 410 | - | 410 | |||||||||
| Right of use lease asset | 1,076 | (471 | )a | 605 | ||||||||
| Other assets | 2,282 | - | 2,282 | |||||||||
| Total Assets | $ | 43,589 | $ | (15,827 | ) | $ | 27,762 | |||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||||||
| Current liabilities | ||||||||||||
| Accounts payable and accrued liabilities | $ | 66,097 | $ | (56,863 | )a | $ | 9,234 | |||||
| Line of credit | 535 | - | 535 | |||||||||
| Accrued payroll and sales tax | 2,903 | (1,490 | )a | 1,413 | ||||||||
| Notes payable – current portion | 8,512 | - | 8,512 | |||||||||
| Lease liability – current portion | 701 | (309 | )a | 392 | ||||||||
| Other current liabilities | 7,575 | (5,891 | )a | 1,684 | ||||||||
| Total current liabilities | 86,323 | (64,553 | ) | 21,770 | ||||||||
| Long-term liabilities | ||||||||||||
| Accrued interest and accrued liabilities, related party | 73 | - | 73 | |||||||||
| Notes payable, less current portion | 234 | - | 234 | |||||||||
| Lease liability | 353 | (178 | )a | 175 | ||||||||
| Other long-term liabilities | 494 | 10,000 | f | 10,494 | ||||||||
| Total liabilities | 87,477 | (54,731 | ) | 32,746 | ||||||||
| Stockholders’ equity (deficit) | ||||||||||||
| Series C Preferred stock; $0.001 par value | 1 | - | 1 | |||||||||
| Common stock; $0.001 par value | 11 | - | 11 | |||||||||
| Additional paid-in capital | 78,713 | - | 78,713 | |||||||||
| Accumulated (deficit) | (123,899 | ) | 38,902 | b | (84,997 | ) | ||||||
| Accumulated other comprehensive income | 1,286 | 2 | c | 1,288 | ||||||||
| Total OmniQ stockholders’ equity (deficit) | (43,888 | ) | 38,904 | (4,984 | ) | |||||||
| Total liabilities and equity (deficit) | $ | 43,589 | $ | (15,827 | ) | $ | 27,762 | |||||
OMNIQ CORP.
Unaudited Pro Forma Condensed Consolidated Statement of Loss
(In thousands, except per-share amounts)
| For the year ended December 31, 2024 | ||||||||||||
| Pro Forma | ||||||||||||
| (In thousands, except share and per share data) | As Reported | Adjustments | Pro Forma | |||||||||
| Revenues | $ | 73,573 | $ | (38,692 | )d | $ | 34,881 | |||||
| Cost of goods sold | 58,217 | (28,965 | )d | 29,252 | ||||||||
| Gross profit | 15,356 | (9,727 | )d | 5,629 | ||||||||
| Operating expenses | ||||||||||||
| Research & Development | 1,497 | 352 | d | 1,849 | ||||||||
| Selling, general and administrative | 19,491 | (10,350 | )d | 9,141 | ||||||||
| Depreciation | 364 | (18 | )d | 346 | ||||||||
| Depreciation | 915 | - | 915 | |||||||||
| Total operating expenses | 22,267 | (10,016 | ) | 12,251 | ||||||||
| Loss from operations | (6,911 | ) | 289 | (6,622 | ) | |||||||
| Other income (expenses): | - | |||||||||||
| Interest expense | (3,455 | ) | 2,399 | d | (1,056 | ) | ||||||
| Other (expenses) income | (334 | ) | (157 | )d | (491 | ) | ||||||
| Total other expenses | (3,789 | ) | 2,242 | (1,547 | ) | |||||||
| Net Loss Before income Taxes | (10,700 | ) | 2,531 | (8,169 | ) | |||||||
| Provision for Income Taxes | ||||||||||||
| Current | 698 | (165 | )e | 533 | ||||||||
| Total Provision for Income Taxes | 698 | (165 | ) | 533 | ||||||||
| Net (Loss) Income | $ | (10,002 | ) | $ | 2,366 | $ | (7,636 | ) | ||||
NOTES TO THE UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
The following items resulted in adjustments in the unaudited pro form condensed consolidated financial information:
| a) | Adjustment represent the elimination of assets and liabilities sold. | |
| b) | Adjustment represents the elimination of net assets sold. | |
| c) | Adjustment represents the amount of accumulated other comprehensive income related to the net assets sold. | |
| d) | Adjustments reflect the elimination of revenue, costs, and expenses directly attributed to the assets and liabilities sold. | |
| e) | Adjustment reflects the approximate tax effect calculated on a prorated basis. | |
| f) | Adjustment represents the note payable issued to the buyer. |
Exhibit 99.2
OMNIQ Corp Sells Legacy Business Unit to Strengthen Balance Sheet and Continue Focus on High-Growth AI & Automation Sectors
Salt Lake City – July 16, 2025 – OMNIQ Corp (OTCMKTS: OMQS.OB) (“OMNIQ” or “the Company”) today announced it has completed the sale of a portion of its U.S.-based legacy assets to Summit Junction Holdings LLC, a private company, marking a major milestone in its strategic transformation. The transaction eliminates approximately 63% of the Company’s debt, thus reinforcing omniQ’s balance sheet and positioning the Company for growth.
This transaction is part of OMNIQ’s ongoing initiative to streamline operations, enhance profitability, and focus resources on its core high-growth divisions: Smart Automation and AI-driven products. On a pro forma basis, these remaining business units generated approximately $38.5 million of the company’s total 2024 consolidated revenue.
Strategic Rationale and Impact
This divestiture marks a pivotal moment in OMNIQ’s evolution, reinforcing its financial strength, operational agility, and strategic clarity. The transaction enables OMNIQ to:
Enhance Financial Strength
The sale will remove debt tied to the legacy business, significantly improving the Company’s balance sheet. Main improvements include the elimination of approximately 63% of the Company’s total pre-sale debt from its balance sheet, labor cost taken off OMNIQ’s payroll, reducing personnel-related costs, and many more, supporting long-term financial health.
Streamline Operations
The sale of the legacy division simplifies OMNIQ’s organizational structure, eliminates operational burdens and allows scalability, reduces our dependency on limited vendors, creating greater operational flexibility while supporting long-term efficiency and cost optimization.
Sharpen Strategic Focus
With a leaner and a flexible structure, OMNIQ can focus on its strongest long-term growth opportunities: specifically in AI, computer vision, and smart automation. The move supports the Company’s long-term vision while addressing market dynamics and investor expectations, with a sharpened focus on our highest-margin, recurring-revenue business lines.
Position for Growth
With the new optimized product portfolio, the transaction provides OMNIQ with the flexibility to reinvest in innovation, customer delivery, and scalable growth which are key drivers of sustainable shareholder value.
Executive Commentary
“This transaction is a transformative step forward,” said Shai Lustgarten, CEO and Chairman of the Board. “It allows us to fully focus on our Smart Automation and AI business units while strengthening our financial position and resolving long-standing balance sheet burdens and operational challenges. We’re entering a new chapter — focused, leaner, stronger, and more strategically aligned with the opportunities ahead.”
Financial Outlook
From an accounting perspective, the transaction is expected to generate an estimated $35 million gain in fiscal year 2025 due to the elimination of approximately $45 million in debt, further reinforcing OMNIQ’s balance sheet.
INFORMATION ABOUT FORWARD-LOOKING STATEMENTS
“Safe Harbor” Statement under the Private Securities Litigation Reform Act of 1995. Statements in this press release relating to plans, strategies, economic performance and trends, projections of results of specific activities or investments, and other statements that are not descriptions of historical facts may be forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934.
This release contains “forward-looking statements” that include information relating to future events and future financial and operating performance. The words “anticipate,” “may,” “would,” “will,” “expect,” “estimate,” “can,” “believe,” “potential” and similar expressions and variations thereof are intended to identify forward-looking statements. Forward-looking statements should not be read as a guarantee of future performance or results and will not necessarily be accurate indications of the times at, or by, which that performance or those results will be achieved. Forward-looking statements are based on information available at the time they are made and/or management’s good faith belief as of that time with respect to future events and are subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in or suggested by the forward-looking statements.
Examples of forward-looking statements include, among others, statements made in this press release regarding the closing of the private placement and the use of proceeds received in the private placement. Important factors that could cause these differences include, but are not limited to: fluctuations in demand for the Company’s products particularly during the current health crisis, the introduction of new products, the Company’s ability to maintain customer and strategic business relationships, the impact of competitive products and pricing, growth in targeted markets, the adequacy of the Company’s liquidity and financial strength to support its growth, the Company’s ability to manage credit and debt structures from vendors, debt holders and secured lenders, the Company’s ability to successfully integrate its acquisitions, and other information that may be detailed from time-to-time in OMNIQ Corp.’s filings with the United States Securities and Exchange Commission. Examples of such forward-looking statements in this release include, among others, statements regarding revenue growth, driving sales, operational and financial initiatives, cost reduction and profitability, and simplification of operations. For a more detailed description of the risk factors and uncertainties affecting OMNIQ Corp., please refer to the Company’s recent Securities and Exchange Commission filings, which are available at SEC.gov. OMNIQ Corp. undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise, unless otherwise required by law.
For investor relations, contact
IR@omniq.com