8-K - STLY - Equibles

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): April 21, 2025

HG Holdings, Inc.

(Exact name of registrant as specified in its charter)

Delaware	001-34964	54-1272589
(State or other jurisdiction of incorporation)	(Commission File Number)	(I.R.S. Employer Identification No.)

2115 E. 7th Street, Suite 101

Charlotte, North Carolina 28204

(Address of principal executive offices) (Zip Code)

Registrant’s telephone number, including area code: (850) 299-9296

Not Applicable

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

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

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

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

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

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

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

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

Emerging growth company ☐

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

Item 1.01 Entry into a Material Definitive Agreement.

Stock Repurchase Agreement

On April 21, 2025, HG Holdings, Inc. (the “Company”) entered into a Stock Repurchase Agreement (the “Repurchase Agreement”) with certain of its existing stockholders who are managed by Solas Capital Management, LLC (the “Sellers”), pursuant to which the Sellers agreed to sell to the Company, and the Company agreed to repurchase from the Sellers, an aggregate of 402,322 shares of the Company’s common stock, par value $0.02 per share (“Common Stock”), held by the Sellers, for an aggregate price of $3,138,111.60 (the “Repurchase”). The Repurchase was made outside of, and as an exception to, the Company’s share repurchase program, which authorizes the Company to repurchase up to $1,500,000 (exclusive of fees and commissions) in shares of Common Stock.

Prior to the Repurchase, the Sellers owned an aggregate of approximately 41.4% of the Company’s outstanding shares of Common Stock. After giving effect to the Repurchase and the transactions effected pursuant to the Contribution Agreement (defined and described below), the Sellers now own an aggregate of approximately 14.4% of the Company’s outstanding shares of Common Stock.

Assignment and Contribution Agreement

On April 21, 2025, the Company entered into an Assignment and Contribution Agreement (the “Contribution Agreement”) with the assignors listed on Schedule A thereto (the “Assignors”), pursuant to which the Assignors agreed to assign and contribute to the Company an aggregate of 10,203 shares of common stock, no par value, and 291,656 shares of Class A stock, no par value, of ACMAT Corporation, a Connecticut corporation, and, in consideration of and exchange therefor, the Company agreed to issue to the Assignors an aggregate of 2,899,876 shares of Common Stock, contingent upon the closing of the transactions contemplated by the Services Agreement (defined and described below).

Hale Partnership Capital Management, LLC, an entity wholly owned by the Company’s Chairman and Chief Executive Officer, Steven A. Hale II, is the registered investment advisor or investment manager for each of the Assignors, and Mr. Hale is the sole principal owner of Hale Partnership Capital Advisors, LLC, the general partner of all but one of the Assignors.

Prior to the transactions effected pursuant to the Contribution Agreement and the Repurchase described above, the Assignors owned an aggregate of approximately 34.7% of the Company’s outstanding shares of Common Stock. After giving effect to the transactions effected pursuant to the Contribution Agreement and the Repurchase described above, the Assignors now own an aggregate of approximately 73.0% of the Company’s outstanding shares of Common Stock. In addition, after giving effect to these transactions, Mr. Hale individually owns 0.52% of the Company’s outstanding shares of Common Stock.

Master Services Agreement

On April 21, 2025, the Company entered into a Master Services Agreement, effective June 1, 2025, with HP Risk Solutions, LLC, a wholly-owned subsidiary of HP Holding Company, LLC, which is wholly owned by certain affiliates of Mr. Hale, pursuant to which the Company will provide certain managerial and operational services to HP Risk Solutions, LLC for consideration from HP Risk Solutions, LLC of $6 million per year over the course of three years (the “Services Agreement”). Such services to be performed pursuant to the Services Agreement include, but are not limited to: reinsurance brokerage services; the review and improvement of financial goals; compliance with legal and regulatory mandates; maintenance of an ethical business environment; investment and asset manager compliance; cash and equity management; corporate tax management; personnel management; related party transaction oversight; tax preparation administration; strategic capital modeling; the review of potential acquisitions and transactions involving affiliates and third parties, including but not limited to, renewal rights deals, loss portfolio transfers or entity acquisitions; execution of (or provision for the execution of) all general corporate legal matters; and provision of internal control management services.

The foregoing descriptions of the Repurchase Agreement, Contribution Agreement and Services Agreement do not purport to be complete and are qualified in their entirety by reference to the full text of the Repurchase Agreement, Contribution Agreement and Services Agreement, copies of which are filed as Exhibits 10.1, 10.2 and 10.3, respectively, to this report and incorporated herein by reference.

Item 3.02 Unregistered Sales of Equity Securities.

The information set forth in Item 1.01 above is incorporated by reference into this Item 3.02. The shares of Common Stock issued pursuant to the Contribution Agreement were issued in reliance on exemptions from registration pursuant to Section 4(a)(2) under the Securities Act of 1933, as amended, and/or Rule 506(b) of Regulation D promulgated thereunder, as a transaction by an issuer not involving any public offering.

Item 5.01 Changes in Control of Registrant.

The information set forth in Item 1.01 above is incorporated by reference into this Item 5.01. In addition, no arrangements are known to the Company the operation of which may at a subsequent date result in a change in control of the Company.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits.

Exhibit No.	Description
10.1	Stock Repurchase Agreement, dated April 21, 2025, by and among HG Holdings, Inc. and the Sellers named therein
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10.2	Assignment and Contribution Agreement, dated April 21, 2025, by and among HG Holdings, Inc. and the Assignors named therein
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10.3	Master Services Agreement, dated April 21, 2025, by and between HG Holdings, Inc. and HP Risk Solutions, LLC
---	---
104	Cover Page Interactive Data File – the cover page XBRL tags are embedded within the Inline XBRL document
---	---

SIGNATURES

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

		HG HOLDINGS, INC.
Date: April 23, 2025	By:	/s/ Anna Lieb
		Name:	Anna Lieb
		Title:	Principal Financial and Accounting Officer; Secretary

ex_804581.htm

Exhibit 10.1

Stock Repurchase Agreement

This Stock Repurchase Agreement (this “Agreement”) is entered into as of April 21, 2025, by and between HG Holdings, Inc., a Delaware corporation (the “Company”), and each of the entities listed on Schedule A hereto (each a “Seller” and collectively the “Sellers”), each of which owns, directly or indirectly, the securities of the Company set forth opposite such Seller’s name on Schedule A hereto. The Company and the Sellers may be collectively referred to herein as the “parties,” or individually as a “party.”

RECITALS

WHEREAS, **** the Sellers hold an aggregate of 1,165,049 shares of the Company’s Common Stock, par value $0.02 per share (the “Common Stock”);

WHEREAS, the Sellers desire to sell, and the Company desires to repurchase, an aggregate of 402,322 shares of the Common Stock held by the Sellers (the “Repurchase Shares”), on the terms and subject to the conditions contained in this Agreement (the “Repurchase”); and

WHEREAS, it is the intention of the parties that the Repurchase be a private sale of securities that is exempt from the registration and prospectus delivery requirements of the Securities Act of 1933, as amended (the “Securities Act”).

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

SECTION 1. REPURCHASE.

(a) Repurchase. At the Closing (as defined below), the Company hereby agrees to repurchase from the Sellers, and the Sellers hereby agree to sell, assign, transfer and deliver to the Company, all of the Sellers’ right, title and interest in the Repurchase Shares for consideration of $7.80 multiplied by the number of Repurchase Shares, for an aggregate purchase price of $3,138,111.60 (the “Repurchase Amount”). The Company shall, or shall cause its transfer agent to, cancel on its books and records the Repurchase Shares and in lieu thereof, shall deliver promptly to Solas Capital Management, LLC (“Solas”), a Delaware limited liability company and the investment manager of each Seller, on behalf of each Seller, the Repurchase Amount by wire transfer (subject to Section 1(b) below) of immediately available funds to an account designated by Solas to the Company prior to the Closing. Thereupon, the Sellers’ rights in and to the Repurchase Shares shall terminate, and the Repurchase Shares shall be restored to the status of authorized but unissued shares of Common Stock.

(b)Withholding Rights. If required by law, the Company shall be entitled to deduct and withhold from the Repurchase Amount such amounts as it may be required to deduct and withhold with respect to the making of such payment under the United States Internal Revenue Code of 1986, as amended, or any provision of state or local tax law. To the extent that amounts are so withheld by the Company, such withheld amounts shall be treated for all purposes of this Agreement as having been paid to the Sellers in respect of which such deduction and withholding were made by the Company.

(c)Closing. The closing of the Repurchase (the “Closing”) shall take place simultaneously with the execution of this Agreement on the date hereof remotely by exchange of documents and signatures (or their electronic counterparts).

SECTION 2. SELLER REPRESENTATIONS AND WARRANTIES. In connection with the Repurchase, each Seller represents and warrants to the Company as follows:

(a)Ownership of Repurchase Shares. The Seller owns all right, title and interest (legal and beneficial) in and to all of the Repurchase Shares set forth opposite such Seller’s name on Schedule A hereto free and clear of all liens, including without limitation any lien, pledge, claim, security interest, encumbrance, mortgage, assessment, charge, restriction or limitation of any kind, whether arising by agreement, operation of law or otherwise. Upon delivery and payment for the Repurchase Shares set forth opposite such Seller’s name on Schedule A hereto, the Company shall acquire valid and unencumbered title to such Repurchase Shares. No person has any agreement, option, understanding or commitment (oral or in writing) with the Seller, or any right or privilege capable of becoming an agreement, option or commitment, for the purchase or acquisition of any of the Repurchase Shares set forth opposite such Seller’s name on Schedule A hereto.

(b)Authorization and Enforceability. The Seller has full power and authority to execute, deliver and perform its obligations under this Agreement. This Agreement has been duly executed and delivered by the Seller and constitutes a legal, valid and binding obligation of the Seller, enforceable in accordance with its terms except (i) as limited by applicable bankruptcy, insolvency, reorganization, moratorium, and other laws of general application affecting enforcement of creditors’ rights generally and (ii) as limited by laws relating to the availability of specific performance, injunctive relief, or other equitable remedies.

(c)No Conflicts; No Consents or Approvals. The Seller’s execution of this Agreement and the consummation of the transactions contemplated hereby do not violate any order, writ, injunction or decree of any court, administrative agency or governmental body, and will not conflict with or result in a default under any agreement, order, or decree, or the like, to which the Seller is a party or by which the Seller may be bound or affected. The Seller is not subject to any restraint or limitation upon the sale of the Repurchase Shares set forth opposite such Seller’s name on Schedule A hereto, and no consent from any person, entity or governmental agency or authority is required for the sale of the Repurchase Shares set forth opposite such Seller’s name on Schedule A hereto hereunder.

(d)Receipt of Information. THE SELLER ACKNOWLEDGES THAT IT (I) HAS MADE THE DECISION TO SELL THE REPURCHASE SHARES SET FORTH OPPOSITE SUCH SELLER’S NAME ON SCHEDULE A HERETO VOLUNTARILY AND WITHOUT INDUCEMENT BY THE COMPANY AND THAT THE REPURCHASE AMOUNT IS THE SUBJECT OF NEGOTIATION BETWEEN THE SELLERS AND THE COMPANY AND DOES NOT NECESSARILY REPRESENT THE FAIR MARKET VALUE OF THE REPURCHASE SHARES, (II) HAS UNDERTAKEN A THOROUGH EVALUATION OF THE TRANSACTIONS CONTEMPLATED HEREBY, (III) IS AN INFORMED AND SOPHISTICATED ENTITY FAMILIAR WITH TRANSACTIONS SIMILAR TO THOSE CONTEMPLATED BY THIS AGREEMENT, AND (IV) HAS HAD AN OPPORTUNITY TO CONSULT WITH LEGAL AND FINANCIAL EXPERTS REGARDING THE TRANSACTIONS CONTEMPLATED HEREBY. THE SELLER ACKNOWLEDGES THAT NEITHER THE COMPANY NOR ANY OF ITS DIRECTORS, OFFICERS, EMPLOYEES, AGENTS OR AFFILIATES HAVE MADE ANY REPRESENTATIONS OR WARRANTIES TO THE SELLER RELATING TO THE COMPANY, ITS BUSINESS, FINANCIAL PERFORMANCE OR PROSPECTS, AND THE SELLER HAS NOT RELIED UPON ANY EXPRESS OR IMPLIED REPRESENTATIONS OR WARRANTIES OF ANY NATURE MADE BY OR ON BEHALF OF OR IMPUTED TO THE COMPANY.

(e)No Material Non-public Information. The Seller is not in possession of any material, non-public information relating to the Company. The Seller acknowledges that the Company may be in possession of material non-public information about the Company and its subsidiaries not known to the Seller and the Seller hereby waives any and all claims and causes of action now or hereafter arising against the Company based upon or relating to any alleged non-disclosure of such information and further covenants not to assert any claims against or to sue the Company or any of its directors, officers, employees, agents or affiliates for any loss, damage or liability arising from or relating to its offer and sale of the Repurchase Shares set forth opposite such Seller’s name on Schedule A hereto pursuant to this Agreement arising out of, based upon or in connection with any alleged non-disclosure of such information. It is understood and agreed that the Company makes no representation or warranty to the Seller whatsoever with respect to the business, condition (financial or otherwise), properties, prospects, creditworthiness, status or affairs of the Company or any of its subsidiaries, or with respect to the value of the Repurchase Shares other than the representations and warranties contained in Section 3.

(f)No Continuing Rights. The Seller acknowledges that the Repurchase Amount represents the entire consideration to be paid for the Repurchase Shares and that, after the Closing, the Seller shall have no further rights with respect to the Repurchase Shares (other than the right to receive the Seller’s pro rata portion of the Repurchase Amount).

(g)Further Cooperation. The Seller agrees that it shall (i) make, execute, acknowledge and deliver all such other agreements, consents, orders, receipts, notices, requests, instructions, certificates, letters and other documents as may be necessary to consummate the transactions contemplated by this Agreement; and (ii) in general, to take such further action as the Company may reasonably request to vest title to the Repurchase Shares set forth opposite such Seller’s name on Schedule A hereto in the Company.

(h)Tax Matters. The Seller has had the opportunity to review with its tax advisors the federal, state and local tax consequences of the Repurchase and the transactions contemplated by this Agreement. The Seller is relying solely on such advisors and not on any statements or representations of the Company or any of its agents. The Seller understands that the Seller (and not the Company) shall be responsible for the Seller’s tax liability and any related interest and penalties that may arise as a result of the transactions contemplated by this Agreement.

(i)No Brokers. There are no claims for brokerage commissions, finders’ fees or similar compensation in connection with the transactions contemplated by this Agreement based on any agreement made by or on behalf of the Seller.

SECTION 3. COMPANY REPRESENTATIONS AND WARRANTIES. **** In connection with the Repurchase, the Company represents and warrants to the Sellers as follows:

(a)Authorization and Enforceability. The Company has full power and authority to execute, deliver and perform its obligations under this Agreement. This Agreement has been duly executed and delivered by the Company and constitutes a legal, valid and binding obligation of the Company, enforceable in accordance with its terms except (i) as limited by applicable bankruptcy, insolvency, reorganization, moratorium, and other laws of general application affecting enforcement of creditors’ rights generally and (ii) as limited by laws relating to the availability of specific performance, injunctive relief, or other equitable remedies.

(b)No Conflicts; No Consents or Approvals. The Company’s execution of this Agreement and the consummation of the transactions contemplated hereby do not violate any order, writ, injunction or decree of any court, administrative agency or governmental body, and will not conflict with or result in a default under any agreement, order, or decree, or the like, to which the Company is a party or by which the Company may be bound or affected. The Company is not subject to any restraint or limitation upon the purchase of the Repurchase Shares, and no consent from any person, entity or governmental agency or authority is required for the purchase of the Repurchase Shares hereunder.

(c)No Brokers. There are no claims for brokerage commissions, finders’ fees or similar compensation in connection with the transactions contemplated by this Agreement based on any agreement made by or on behalf of the Company.

(d)No Other Representations or Warranties. EXCEPT FOR THE REPRESENTATIONS AND WARRANTIES CONTAINED IN THIS SECTION 3, NEITHER THE COMPANY NOR ANY OTHER PERSON ON BEHALF OF THE COMPANY MAKES ANY OTHER EXPRESS OR IMPLIED REPRESENTATION OR WARRANTY WITH RESPECT TO THE COMPANY OR ANY OF ITS SUBSIDIARIES OR WITH RESPECT TO ANY OTHER INFORMATION PROVIDED BY OR ON BEHALF OF THE COMPANY.

SECTION 4. MISCELLANEOUS ****

(a)Survival. The representations and warranties set forth in Sections 2 and 3 above shall survive the execution and delivery of this Agreement and the Closing and shall in no way be affected by any investigation of the subject matter thereof made by or on behalf of the recipient of such representations and warranties.

(b)Sellers’ Tax Obligations. The Sellers shall be solely responsible for paying any and all taxes and any related penalties, fines and interest arising out of or related to the transactions contemplated hereby, including, without limitation, any capital gains or income taxes arising from the sale of the Repurchase Shares to the Company (collectively, the “Tax Obligations”). Each of the Sellers shall indemnify and hold harmless the Company, its directors, employees, officers, agents and affiliates from and against its Tax Obligations and all cost, expense, liability and loss (including, without limitation, reasonable attorneys’ fees, judgments, fines, excise taxes or penalties and amounts paid or to be paid in settlement) incurred or suffered by the Company or such other parties in connection with such Tax Obligations, including, without limitation, the cost of defending itself in any suit or proceeding, whether civil, criminal, administrative or investigative in connection with such Tax Obligations.

(c)Successors and Assigns; Third Party Rights. The provisions of this Agreement shall inure to the benefit of, and be binding upon, the Company and the Sellers and their respective successors and assigns, whether or not any such persons have become party to this Agreement or have agreed in writing to join herein and to be bound by the terms, conditions and restrictions hereof. This Agreement is made solely for the benefit of the parties to this Agreement and their respective permitted successors and assigns, and no other persons shall have or acquire any legal or equitable right, remedy, or claim under or with respect to this Agreement or any provision of this Agreement.

(d)Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Delaware as applied to agreements among Delaware residents made and to be performed entirely within the State of Delaware.

(e) Exclusive Jurisdiction; Waiver of Jury Trial. Each of the parties agrees that any legal action or proceeding with respect to this Agreement may be brought in the federal and state courts located in the State of Delaware, and, by execution and delivery of this Agreement, each party to this Agreement irrevocably submits itself in respect of its property, generally and unconditionally, to the exclusive jurisdiction of the aforesaid courts in any legal action or proceeding arising out of this Agreement. Each of the parties irrevocably waives any objection which it may now or hereafter have to the laying of venue of any of the aforesaid actions or proceedings arising out of or in connection with this Agreement brought in the courts referred to in the preceding sentence. Each party consents to process being served in any such action or proceeding by the mailing of a copy thereof to the address below its name on the signature pages attached hereto and agrees that such service upon receipt will constitute good and sufficient service of process or notice thereof. Nothing in this paragraph will affect or eliminate any right to serve process in any other manner permitted by law. To the fullest extent permitted by law, each party hereto waives any and all rights such party may have to a jury trial with respect to any dispute arising under this Agreement or the transactions contemplated hereby.

(f)Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. Facsimile signature pages shall be accepted as originals for all purposes hereof.

(g)Amendments and Waivers. Any term of this Agreement may be amended and the observance of any term of this Agreement may be waived (either generally or in a particular instance and either retroactively or prospectively), only with the written consent of the Company and the Sellers. Any amendment or waiver effected in accordance with this section shall be binding upon each party hereto (and any successors or assigns).

(h)Notices. All notices and other communications given or made pursuant hereto shall be in writing and shall be deemed effectively given: (i) upon personal delivery to the party to be notified, (ii) when sent by confirmed electronic mail or facsimile if sent during normal business hours of the recipient; if not, then on the next business day, (iii) five (5) days after having been sent by registered or certified mail, return receipt requested, postage prepaid, or (iv) one (1) day after deposit with an internationally recognized overnight courier, specifying next day delivery, with written verification of receipt. All communications shall be sent to the respective parties at the addresses set forth on the signature pages attached hereto (or at such other addresses as shall be specified by notice given in accordance with this Section 4(h)).

(i)Further Action. Each party hereto agrees to execute any additional documents and to take any further action as may be necessary or desirable in order to implement the transactions contemplated by this Agreement.

(j)Entire Agreement. This Agreement contains the entire understanding of the parties and there are no further or other agreements or understandings, written or oral, in effect between the parties relating to the subject matter hereof except as expressly referred to herein.

(k)Severability. Whenever possible, each provision of this Agreement shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Agreement shall be held to be prohibited by or invalid under applicable law, such provision shall be ineffective only to the extent of such prohibition or invalidity, without invalidating the remainder of such provision or the remaining provisions of this Agreement.

(l)Expenses. Each of the parties hereto shall bear its own expenses in connection with the drafting, negotiation, execution and delivery of this Agreement and the consummation of the transactions contemplated hereby. ****

[Remainder of page intentionally left blank; signature page follows.]

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first above written.

COMPANY:<br><br> <br><br><br> <br>HG HOLDINGS, INC.
By:	/s/ Steven A. Hale II
Name:	Steven A. Hale II
Title:	Chief Executive Officer
Address for notices pursuant to Section 4(h):<br><br> <br><br><br> <br>2115 E. 7^th^ Street<br><br> <br>Suite 101<br><br> <br>Charlotte, NC 28204<br><br> <br>Attn: Chief Financial Officer
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SELLERS:<br><br> <br><br><br> <br>SOLAS CAPITAL PARTNERS, LP<br><br> <br><br><br> <br>By: Solas Capital Management, LLC, its investment manager
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By:	/s/ Tucker Golden
Name:	Frederick Tucker Golden
Title:	Portfolio Manager
SOLAS CAPITAL PARTNERS II, LP<br><br> <br>By: Solas Capital Management, LLC, its investment manager
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By:	/s/ Tucker Golden
Name:	Frederick Tucker Golden
Title:	Portfolio Manager
BLACKWELL PARTNERS, LLC<br><br> <br><br><br> <br>By: Solas Capital Management, LLC, its investment manager
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By:	/s/ Tucker Golden
Name:	Frederick Tucker Golden
Title:	Portfolio Manager
Address for notices pursuant to Section 4(h):<br><br> <br><br><br> <br>1063 Post Road, 2^nd^ Floor<br><br> <br>Darien, CT 06820
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[Signature Page to Stock Repurchase Agreement]

Schedule A

Seller	Shares of Common Stock<br><br> <br>(Prior to Giving Effect to the<br><br> <br>Repurchase)	Repurchase Shares
Solas Capital Partners, LP	77,237	24,571
Solas Capital Partners II, LP	139,220	78,980
Blackwell Partners, LLC	948,592	298,771
Total	1,165,049	402,322

ex_804582.htm

Exhibit 10.2

Assignment and Contribution Agreement

This Assignment and Contribution Agreement (this “Agreement”) is made as of April 21, 2025 (the “Effective Date”), by and among each of the entities listed on Schedule A hereto (each an “Assignor” and collectively the “Assignors”), each of which owns, directly or indirectly, the number of shares of common stock, no par value, and Class A stock, no par value (collectively, the “ACMAT Shares”), of ACMAT Corporation, a Connecticut corporation (“ACMAT”), set forth opposite such Assignor’s name on Schedule A hereto, and HG Holdings, Inc., a Delaware corporation (“Assignee” and, together with the Assignors, the “Parties”).

Recitals

A. Hale Partnership Capital Management, LLC (“HPCM”) serves as the registered investment advisor or investment manager for each of the Assignors, and Steven A. Hale II is the sole principal owner of Hale Partnership Capital Advisors, LLC, the general partner of all but one of the Assignors. Mr. Hale also serves as the Chairman and Chief Executive Officer of Assignee and owns shares of common stock of Assignee.

B. Assignors own the number of ACMAT Shares set forth opposite each Assignor’s name on Schedule A hereto.

C. As of the Effective Date, each Assignor intends to assign and contribute the number of ACMAT Shares set forth opposite such Assignor’s name on Schedule A hereto to Assignee.

D. In consideration of and exchange for such assignment and contribution, Assignee intends to issue to each Assignor the number of shares of Assignee’s common stock, par value $0.02 per share (“Assignee Common Stock”), set forth opposite each Assignor’s name on Schedule A hereto.

E. Assignor and Assignee are entering into this Agreement in order to effect the transactions as described herein.

Agreement

Therefore, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:

1. Assignment and Contribution of ACMAT Shares. Effective simultaneously herewith, subject to the satisfaction of the condition set forth in Section 5 below, each Assignor hereby transfers, assigns, and contributes the number of ACMAT Shares set forth opposite such Assignor’s name on Schedule A hereto, to Assignee. Each Assignor hereby warrants and represents as of the Effective Date that: (a) such Assignor is duly formed, validly existing and in good standing under the laws of its state of formation and, to the extent required by applicable laws, is duly qualified to do business and in good standing in any jurisdiction in which it is required; (b) such Assignor is authorized to execute this Agreement (and any other documents as may be required to consummate the transactions contemplated hereunder) and fulfill all of its obligations hereunder, and such instruments, obligations and actions are valid and legally binding on it, enforceable in accordance with their respective terms; (c) the execution and delivery of this Agreement by such Assignor and the performance of its obligations hereunder, will not (1) result in the violation of any law or any provision of such Assignor’s organizational documents, (2) conflict with any order of any court or governmental instrumentality binding on such Assignor, or (3) conflict or be inconsistent with, or result in any default under, any contract, agreement or commitment to which such Assignor is bound; (d) such Assignor owns the ACMAT Shares set forth opposite such Assignor’s name on Schedule A hereto; (e) the ACMAT Shares owned by such Assignor to be assigned pursuant to this Agreement have not been sold, assigned, hypothecated, pledged or otherwise transferred; (f) no interest in the ACMAT Shares owned by such Assignor to be assigned pursuant to this Agreement has been sold, assigned, hypothecated, pledged or otherwise transferred; (g) the ACMAT Shares owned by such Assignor to be assigned pursuant to this Agreement are free and clear of any and all liens, encumbrances or claims of any kind or character whatsoever; (h) there are no voting trusts or other agreements or understandings affecting the ACMAT Shares owned by such Assignor to be assigned pursuant to this Agreement; (i) such Assignor is duly authorized to assign the ACMAT Shares owned by such Assignor to be assigned pursuant to this Agreement; (j) the assignment and contribution of the ACMAT Shares owned by such Assignor to be assigned pursuant to this Agreement have been duly authorized by all necessary action of the general partner or other governing body of such Assignor (as applicable); (k) there are no consents or approvals required for the assignment and contribution of the ACMAT Shares owned by such Assignor to be assigned pursuant to this Agreement that have not been waived or obtained; (l) to the best of such Assignor’s knowledge, such Assignor has not received any written notice, and such Assignor does not have any knowledge, of any current, pending or threatened tort litigation against ACMAT or ACMAT’s assets which would adversely affect ACMAT, ACMAT’s assets or the beneficial ownership interests therein in any material respect; (m) such Assignor has not received written notice of any, and to such Assignor’s knowledge there are no, pending, threatened or proposed actions by any governmental agencies or authorities which have or may create a lien upon ACMAT’s assets or any portion thereof; and (n) the ACMAT Shares owned by such Assignor to be assigned pursuant to this Agreement have been held by such Assignor for at least 12 months or were acquired from a person or entity that held such ACMAT Shares for at least 12 months.

2. Issuance of Assignee Common Stock. Effective simultaneously herewith, subject to the satisfaction of the condition set forth in Section 5 below, in consideration of and exchange for the assignment and contribution of ACMAT Shares, Assignee hereby issues to each Assignor the number of shares of Assignee Common Stock set forth opposite each Assignor’s name on Schedule A hereto. Assignee hereby warrants and represents as of the Effective Date that: (a) Assignee is duly formed, validly existing and in good standing under the laws of its state of formation and, to the extent required by applicable laws, is duly qualified to do business and in good standing in any jurisdiction in which it is required; (b) Assignee is authorized to execute this Agreement (and any other documents as may be required to consummate the transactions contemplated hereunder) and fulfill all of its obligations hereunder, and such instruments, obligations and actions are valid and legally binding on it, enforceable in accordance with their respective terms; (c) the execution and delivery of this Agreement executed by Assignee and the performance of its obligations hereunder, will not (1) result in the violation of any law or any provision of Assignee’s organizational documents, (2) conflict with any order of any court or governmental instrumentality binding on Assignee, or (3) conflict or be inconsistent with, or result in any default under, any contract, agreement or commitment to which Assignee is bound; (d) the shares of Assignee Common Stock to be issued pursuant to this Agreement have been duly authorized and, upon the issuance of such shares pursuant to this Agreement, will be validly issued, fully paid and non-assessable; (e) the issuance of the shares of Assignee Common Stock to be issued pursuant to this Agreement has been duly authorized by all necessary action of the board of directors of Assignee; and (f) there are no consents or approvals required for the issuance of the shares of Assignee Common Stock to be issued pursuant to this Agreement that have not been waived or obtained.

3. Acceptance and Assumption of ACMAT Shares. As of the Effective Date, subject to the satisfaction of the condition set forth in Section 5 below, Assignee hereby accepts assignment of the number of ACMAT Shares set forth opposite each Assignor’s name on Schedule A hereto. Assignee is aware that HPCM serves as the registered investment advisor or investment manager for each of the Assignors, and Steven A. Hale II, the Chairman and Chief Executive Officer of Assignee, is the sole principal owner of Hale Partnership Capital Advisors, LLC, the general partner of all but one of the Assignors. Assignee hereby certifies that it has had the opportunity to obtain all information that is necessary in its reasonable judgment to determine that the values ascribed to the ACMAT Shares and the Assignee Common Stock for purposes of the transactions contemplated in this Agreement are fair and reasonable and in the best interest of Assignee. On the Effective Date, each Assignor shall effect by book entry, in accordance with the applicable procedures of ACMAT’s transfer agent, the delivery to Assignee of all of the ACMAT Shares set forth opposite such Assignor’s name on Schedule A hereto and execute or provide all other documents and instruments reasonably requested by Assignee to effect the transfer of such ACMAT Shares to Assignee.

4. Acceptance and Acquisition of Assignee Common Stock. As of the Effective Date, subject to the satisfaction of the condition set forth in Section 5 below, each Assignor hereby accepts and acquires the number of shares of Assignee Common Stock set forth opposite each Assignor’s name on Schedule A hereto. Each of the Assignors is aware that HPCM serves as the registered investment advisor or investment manager for each of the Assignors, and Steven A. Hale II, the Chairman and Chief Executive Officer of Assignee, is the sole principal owner of Hale Partnership Capital Advisors, LLC, the general partner of all but one of the Assignors. Each of the Assignors hereby certifies that it has had the opportunity to obtain all information that is necessary in its reasonable judgment to determine that the values ascribed to the ACMAT Shares and the Assignee Common Stock for purposes of the transactions contemplated in this Agreement are fair and reasonable and in the best interest of such Assignor. Each Assignor hereby represents that it is acquiring the Assignee Common Stock for its own account and for investment purposes. Each Assignor further represents that it is not acquiring the Assignee Common Stock with the view to, or for resale in connection with, any distribution of the Assignee Common Stock within the meaning of the Securities Act of 1933, as amended (the “Securities Act”). Such Assignor does not intend to resell, assign or otherwise dispose of all or any of the Assignee Common Stock, except as permitted by applicable law, including, without limitation, any regulations under the Securities Act, and in accordance with Assignee’s charter. Each Assignor recognizes that the Assignee Common Stock to be issued pursuant to this Agreement has not been registered with the Securities and Exchange Commission or with any state securities commission or authority and that such Assignor has no contractual right for the registration of the Assignee Common Stock to be issued pursuant to this Agreement under the Securities Act or the securities laws of any state to permit the same to be resold. Each Assignor recognizes that Rule 144 under the Securities Act may not be available as a basis for exemption from registration of the Assignee Common Stock. Each Assignor understands further that unless the Assignee Common Stock is registered or an exemption from registration is available, the Assignee Common Stock must be held by such Assignor for an indefinite period of time, and that such Assignor must bear the economic risk of the investment for such period. Each Assignor is an “accredited investor” as such term is defined under Rule 501 of Regulation D promulgated under the Securities Act.

5. Conditions to Closing. The obligation of any of the Parties to consummate the transactions contemplated herein is subject to the execution and delivery by all parties thereto of that certain Master Services Agreement by and between HG Managing Agency, LLC, a wholly-owned subsidiary of Assignee, and HP Risk Solutions, LLC, a wholly-owned subsidiary of HP Holding Company, LLC, which is wholly owned by funds and accounts managed, directly or indirectly, by HPCM.

6. Miscellaneous.

(a) Subsequent Documents. Each party agrees to execute such further instruments and assurances or provide such other documents as may be reasonably necessary to effectuate the purposes of this Agreement.

(b) Entire Agreement. This Agreement represents the entire agreement between the Parties concerning the matters described in this Agreement. This Agreement revokes and supersedes all prior agreements between the Parties concerning the matters that are the subject of this Agreement. Neither this Agreement nor any provision hereof may be waived, modified, amended, discharged or terminated except by an instrument signed by the party against whom the enforcement of such waiver, modification, amendment, discharge or termination is sought, and then only to the extent set forth in such instrument. No waiver by any party hereto of any failure or refusal by any other party to comply with its obligations hereunder shall be deemed a waiver of any other or subsequent failure or refusal to so comply.

(c) Benefit and Burden. All terms of this Agreement shall be binding upon, and inure to the benefit of, the Parties and their respective successors and assigns.

(d) Counterparts. This Agreement may be executed in counterparts, each of which shall be an original, but altogether shall constitute one and the same instrument. Counterparts delivered by fax or by email in PDF shall be deemed originals.

(e) Severability. The invalidity or unenforceability of any provision in this Agreement shall not impair the validity or enforceability of any other provision in this Agreement.

(f) Governing Law. This Agreement shall be governed by the laws of the State of Delaware.

[The remainder of this page is intentionally left blank.]

IN WITNESS WHEREOF, the Parties have executed this Assignment and Contribution Agreement effective as of the Effective Date.

ASSIGNORS : HALE PARTNERSHIP FUND, L.P. By: Hale Partnership Capital Advisors, LLC, its general partner By: /s/ Steven A. Hale II Name: Steven A. Hale II Title: Manager THE VANDERBILT UNIVERSITY “VUA HALE SMA” By: Hale Partnership Capital Management, LLC, its investment manager By: /s/ Steven A. Hale II Name: Steven A. Hale II Title: Manager MGEN II – HALE FUND, LP. By: Hale Partnership Capital Advisors, LLC, its general partner By: /s/ Steven A. Hale II Name: Steven A. Hale II Title: Manager DICKINSON – HALE FUND L.P. By: Hale Partnership Capital Advisors, LLC, its general partner By: /s/ Steven A. Hale II Name: Steven A. Hale II Title: Manager

[Signatures continue on the following page.]

SMITH – HALE FUND L.P. By: Hale Partnership Capital Advisors, LLC, its general partner By: /s/ Steven A. Hale II Name: Steven A. Hale II Title: Manager HALE ICFG FUND, L.P. By: Hale Partnership Capital Advisors, LLC, its general partner By: /s/ Steven A. Hale II Name: Steven A. Hale II Title: Manager ASSIGNEE : HG HOLDINGS, INC. By: /s/ Steven A. Hale II Name: Steven A. Hale II Title: Chief Executive Officer

Schedule A

Assignor	Number of Shares of<br><br> <br>ACMAT Common Stock<br><br> <br>and Class A Stock Assigned<br><br> <br>and Contributed by<br><br> <br>Assignor	Number of Shares of<br><br> <br>Assignee Common Stock<br><br> <br>Issued by Assignee
Hale Partnership Fund, L.P.	1,904 Shares of Common Stock and 86,308 Shares of Class A Stock	847,428
VUA Hale SMA	1,875 Shares of Common Stock and 141,010 Shares of Class A Stock	1,372,657
MGEN II – Hale Fund, L.P.	3,420 Shares of Class A Stock	32,855
Dickinson – Hale Fund L.P.	1,900 Shares of Common Stock and 6,938 Shares of Class A Stock	84,904
Smith – Hale Fund L.P.	4,100 Shares of Common Stock and 15,193 Shares of Class A Stock	185,343
Hale ICFG Fund, L.P.	424 Shares of Common Stock and 38,787 Shares of Class A Stock	376,689
Total	10,203 Shares of Common Stock and 291,656 Shares of Class A Stock	2,899,876

ex_804583.htm

Exhibit 10.3

Master Services Agreement

This Master Services Agreement (this "Agreement"), dated as of April 21, 2025, with an effective date of June 1, 2025 (the "Effective Date"), is by and between HG Holdings, Inc., a Delaware corporation, with offices located at 2115 East 7^th^ Street, Suite 101, Charlotte, North Carolina 28204 ("Service Provider") and HP Risk Solutions, LLC, a Florida limited liability company, with offices located at 6265 Old Water Oak Road, Unit 204, Tallahassee, Florida 32312 ("Customer" and together with Service Provider, the "Parties", and each a "Party").

WHEREAS, Service Provider has the capability and capacity to provide certain managerial and operational services; and

WHEREAS, Customer desires to retain Service Provider to provide the said services, and Service Provider is willing to perform such services under the terms and conditions hereinafter set forth;

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, Service Provider and Customer agree as follows:

1. Services. Service Provider shall provide to Customer the services (the "Services") set out in one or more statements of work to be issued by Customer and accepted by Service Provider (each, a "Statement of Work"). The initial accepted Statement of Work is attached hereto as Exhibit A. Additional Statements of Work shall be deemed issued and accepted only if signed by the Parties.

2. Service Provider Obligations. Service Provider shall:

2.1 Designate employees that it determines, in its sole discretion, to be capable of filling the following positions:

(a) A primary contact to act as its authorized representative with respect to all matters pertaining to this Agreement (the "Service Provider Contract Manager").

(b) A number of employees that it deems sufficient to perform the Services set out in each Statement of Work, (collectively, with the Service Provider Contract Manager, "Provider Representatives").

2.2 Make no changes in Provider Representatives except:

(a) Following notice to Customer.

(b) Upon the resignation, termination, death, or disability of an existing Provider Representative.

3. Customer Obligations. Customer shall:

3.1 Designate one of its employees to serve as its primary contact with respect to this Agreement and to act as its authorized representative with respect to matters pertaining to this Agreement (the "Customer Contract Manager"), with such designation to remain in force unless and until a successor Customer Contract Manager is appointed.

3.2 Require that the Customer Contract Manager respond promptly to any reasonable requests from Service Provider for instructions, information, or approvals required by Service Provider to provide the Services.

3.3 Cooperate with Service Provider in its performance of the Services and provide access to Customer's premises, employees, contractors, and equipment as required to enable Service Provider to provide the Services.

3.4 Take all steps necessary, including obtaining any required licenses or consents, to prevent Customer-caused delays in Service Provider's provision of the Services.

4. Fees and Expenses.

4.1 In consideration of the provision of the Services by the Service Provider and the rights granted to Customer under this Agreement, Customer shall pay the fees set out in the Statement of Work. Payment to Service Provider of such fees and the reimbursement of expenses pursuant to this Section 4 shall constitute payment in full for the performance of the Services.

4.2 Customer shall be responsible for all sales, use, and excise taxes, and any other similar taxes, duties, and charges of any kind imposed by any federal, state, or local governmental entity on any amounts payable by Customer hereunder; and to the extent Service Provider is required to pay any such sales, use, excise, or other taxes or other duties or charges, Customer shall reimburse Service Provider in connection with its payment of fees and expenses as set forth in this Section 4. Notwithstanding the previous sentence, in no event shall Customer pay or be responsible for any taxes imposed on, or with respect to, Service Provider's income, revenues, gross receipts, personnel, or real or personal property, or other assets.

5. Limited Warranty and Limitation of Liability.

5.1 Service Provider warrants that it shall perform the Services:

(a) In accordance with the terms and subject to the conditions set out in the respective Statement of Work and this Agreement.

(b) Using personnel of commercially reasonable/industry standard/required skill, experience, and qualifications.

(c) In a timely, workmanlike, and professional manner in accordance with generally recognized industry standards for similar services.

5.2 Service Provider's sole and exclusive liability and Customer's sole and exclusive remedy for breach of this warranty shall be as follows:

(a) Service Provider shall use reasonable commercial efforts to promptly cure any such breach; provided, that if Service Provider cannot cure such breach within a reasonable time (but no more than 30 days) after Customer's written notice of such breach, Customer may, at its option, terminate the Agreement by serving written notice of termination in accordance with Section 8.2.

(b) In the event the Agreement is terminated pursuant to Section 5.2(a) above, Service Provider shall within 30 days after the effective date of termination, refund to Customer any fees paid by the Customer as of the date of termination for the Services or Deliverables (as defined in Section 6 below), less a deduction equal to the fees for receipt or use of such Deliverables or Services up to and including the date of termination on a pro-rated basis.

(c) The foregoing remedy shall not be available unless Customer provides written notice of such breach within 30 days after delivery/acceptance of such Services or Deliverables to Customer.

5.3 SERVICE PROVIDER MAKES NO WARRANTIES EXCEPT FOR THAT PROVIDED IN SECTION 5.1, ABOVE. ALL OTHER WARRANTIES, EXPRESS AND IMPLIED, ARE EXPRESSLY DISCLAIMED.

6. Intellectual Property. All intellectual property rights, including copyrights, patents, patent disclosures, and inventions (whether patentable or not), trademarks, service marks, trade secrets, know-how, and other confidential information, trade dress, trade names, logos, corporate names, and domain names, together with all of the goodwill associated therewith, derivative works, and all other rights (collectively, "Intellectual Property Rights") in and to all documents, work product, and other materials that are delivered to Customer under this Agreement or prepared by or on behalf of the Service Provider in the course of performing the Services (collectively, the "Deliverables") except for any Confidential Information of Customer or customer materials shall be owned by Service Provider. Service Provider hereby grants Customer a license to use all Intellectual Property Rights in the Deliverables free of additional charge and on a non-exclusive, non-transferable, non-sublicenseable, fully paid-up, royalty-free, and perpetual basis to the extent necessary to enable Customer to make reasonable use of the Deliverables and the Services.

7. Confidentiality. From time to time during the Term of this Agreement, either Party (as the "Disclosing Party") may disclose or make available to the other Party (as the "Receiving Party"), non-public, proprietary, and confidential information of Disclosing Party that, if disclosed in writing or other tangible form is clearly labeled as "confidential," or if disclosed orally, is identified as confidential when disclosed and within 30 days thereafter, is summarized in writing and confirmed as confidential ("Confidential Information"); provided, however, that Confidential Information does not include any information that: (a) is or becomes generally available to the public other than as a result of Receiving Party's breach of this Section 7; (b) is or becomes available to the Receiving Party on a non-confidential basis from a third-party source, provided that such third party is not and was not prohibited from disclosing such Confidential Information; (c) was in Receiving Party's possession prior to Disclosing Party's disclosure hereunder; or (d) was or is independently developed by Receiving Party without using any Confidential Information. The Receiving Party shall: (x) protect and safeguard the confidentiality of the Disclosing Party's Confidential Information with at least the same degree of care as the Receiving Party would use to protect its own Confidential Information, but in no event with less than a commercially reasonable degree of care; (y) not use the Disclosing Party's Confidential Information, or permit it to be accessed or used, for any purpose other than to exercise its rights or perform its obligations under this Agreement; and (z) not disclose any such Confidential Information to any person or entity, except to the Receiving Party's Group who need to know the Confidential Information to assist the Receiving Party, or act on its behalf, to exercise its rights or perform its obligations under this Agreement.

If the Receiving Party is required by applicable law or legal process to disclose any Confidential Information, it shall, prior to making such disclosure, use commercially reasonable efforts to notify Disclosing Party of such requirements to afford Disclosing Party the opportunity to seek, at Disclosing Party's sole cost and expense, a protective order or other remedy. For purposes of this Section 7 and Section 8.4 only, Receiving Party's Group shall mean the Receiving Party's affiliates and its or their employees, officers, directors, shareholders, partners, members, managers, agents, independent contractors, service providers, sublicensees, subcontractors, attorneys, accountants, and financial advisors.

8. Term, Termination, and Survival.

8.1 This Agreement shall commence as of the Effective Date and shall continue thereafter until the completion of the Services under all Statements of Work, unless sooner terminated pursuant to Section 8.2 or Section 8.3.

8.2 Either Party may terminate this Agreement, effective upon written notice to the other Party (the "Defaulting Party"), if the Defaulting Party:

(a) Materially breaches this Agreement, and the Defaulting Party does not cure such breach within 30 days after receipt of written notice of such breach, or such material breach is incapable of cure.

(b) Becomes insolvent or admits its inability to pay its debts generally as they become due.

(c) Becomes subject, voluntarily or involuntarily, to any proceeding under any domestic or foreign bankruptcy or insolvency law, which is not fully stayed within seven business days or is not dismissed or vacated within 45 business days after filing.

(d) Is dissolved or liquidated or takes any corporate action for such purpose.

(e) Makes a general assignment for the benefit of creditors.

(f) Has a receiver, trustee, custodian, or similar agent appointed by order of any court of competent jurisdiction to take charge of or sell any material portion of its property or business.

8.3 Notwithstanding anything to the contrary in Section 8.2(a), Service Provider may terminate this Agreement before the expiration date of the Term on written notice if Customer fails to pay any amount when due hereunder: (a) and such failure continues for 30 days after Customer's receipt of written notice of nonpayment; or (b) more than one time in any one month period.

8.4 The rights and obligations of the Parties set forth in this Section 8.4 and in Section and any right or obligation of the Parties in this Agreement which, by its nature, should survive termination or expiration of this Agreement, will survive any such termination or expiration of this Agreement, and with respect to Confidential Information that constitutes a trade secret under applicable law, the rights and obligations set forth in Section 7 hereof will survive such termination or expiration of this Agreement until, if ever, such Confidential Information loses its trade secret protection other than due to an act or omission of the Receiving Party or the Receiving Party's Group.

9. Limitation of Liability.

9.1 IN NO EVENT SHALL SERVICE PROVIDER BE LIABLE TO CUSTOMER OR TO ANY THIRD PARTY FOR ANY LOSS OF USE, REVENUE, OR PROFIT OR LOSS OF DATA OR DIMINUTION IN VALUE, OR FOR ANY CONSEQUENTIAL, INCIDENTAL, INDIRECT, EXEMPLARY, SPECIAL, OR PUNITIVE DAMAGES WHETHER ARISING OUT OF BREACH OF CONTRACT, TORT (INCLUDING NEGLIGENCE), OR OTHERWISE, REGARDLESS OF WHETHER SUCH DAMAGE WAS FORESEEABLE AND WHETHER OR NOT SERVICE PROVIDER HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES, AND NOTWITHSTANDING THE FAILURE OF ANY AGREED OR OTHER REMEDY OF ITS ESSENTIAL PURPOSE.

9.2 IN NO EVENT SHALL SERVICE PROVIDER'S AGGREGATE LIABILITY ARISING OUT OF OR RELATED TO THIS AGREEMENT, WHETHER ARISING OUT OF OR RELATED TO BREACH OF CONTRACT, TORT (INCLUDING NEGLIGENCE), OR OTHERWISE, EXCEED THE AGGREGATE AMOUNTS PAID OR PAYABLE TO SERVICE PROVIDER.

10. Entire Agreement. This Agreement, including and together with any related Statements of Work, exhibits, schedules, attachments, and appendices, constitutes the sole and entire agreement of the Parties with respect to the subject matter contained herein, and supersedes all prior and contemporaneous understandings, agreements, representations and warranties, both written and oral, regarding such subject matter.

11. Notices. All notices, requests, consents, claims, demands, waivers, and other communications under this Agreement (each, a "Notice", and with the correlative meaning "Notify") must be in writing and addressed to the other Party at its address set forth below (or to such other address that the receiving Party may designate from time to time in accordance with this Section). Unless otherwise agreed herein, all Notices must be delivered by personal delivery, nationally recognized overnight courier, or certified or registered mail (in each case, return receipt requested, postage prepaid). Except as otherwise provided in this Agreement, a Notice is effective only (a) on receipt by the receiving Party; and (b) if the Party giving the Notice has complied with the requirements of this Section 11.

Notice to Customer:	HP Risk Solutions, LLC<br><br> <br>6265 Old Water Oak Road, Unit 204<br><br> <br>Tallahassee, Florida 32312
	Attention: Matt Walters
Notice to Service Provider:	HG Holdings, Inc.<br><br> <br>2115 E. 7^th^ Street, Suite 101<br><br> <br>Charlotte, North Carolina 28204
	Attention: Steven A. Hale II

12. Severability. If any term or provision of this Agreement is found by a court of competent jurisdiction to be 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; provided, however, that if any fundamental term or provision of this Agreement is invalid, illegal, or unenforceable, the remainder of this Agreement shall be unenforceable.

13. Amendments. No amendment to or modification of or rescission, termination, or discharge of this Agreement is effective unless it is in writing and signed by an authorized representative of each Party.

14. Waiver. No waiver by any Party of any of the provisions of this Agreement shall be effective unless explicitly set forth in writing and signed by the Party so waiving. Except as otherwise set forth in this Agreement, 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.

15. Assignment. Customer shall not assign, transfer, delegate, or subcontract any of its rights or delegate any of its obligations under this Agreement without the prior written consent of Service Provider. Any purported assignment or delegation in violation of this Section 16 shall be null and void. No assignment or delegation shall relieve the Customer of any of its obligations under this Agreement.

16. Successors and Assigns. This Agreement is binding on and inures to the benefit of the Parties to this Agreement and their respective permitted successors and permitted assigns.

17. Relationship of the Parties. The relationship between the Parties is that of independent contractors. The details of the method and manner for performance of the Services by Service Provider shall be under its own control, Customer being interested only in the results thereof. The Service Provider shall be solely responsible for supervising, controlling and directing the details and manner of the completion of the Services. Nothing in this Agreement shall give the Customer the right to instruct, supervise, control, or direct the details and manner of the completion of the Services. The Services must meet the Customer's final approval and shall be subject to the Customer's general right of inspection throughout the performance of the Services and to secure satisfactory final completion. Nothing contained in this Agreement shall be construed as creating any agency, partnership, joint venture or other form of joint enterprise, employment or fiduciary relationship between the Parties, and neither Party shall have authority to contract for or bind the other Party in any manner whatsoever.

18. No Third-Party Beneficiaries. Agreement benefits solely the Parties to this Agreement and their respective permitted successors and assigns and nothing in this Agreement, express or implied, confers on any other person or entity any legal or equitable right, benefit, or remedy of any nature whatsoever under or by reason of this Agreement.

19. WAIVER OF JURY TRIAL. EACH PARTY ACKNOWLEDGES THAT ANY CONTROVERSY THAT MAY ARISE UNDER THIS AGREEMENT, INCLUDING EXHIBITS, SCHEDULES, ATTACHMENTS, AND APPENDICES ATTACHED TO THIS AGREEMENT, IS LIKELY TO INVOLVE COMPLICATED AND DIFFICULT ISSUES AND, THEREFORE, EACH SUCH 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, INCLUDING ANY EXHIBITS, SCHEDULES, ATTACHMENTS, OR APPENDICES ATTACHED TO THIS AGREEMENT, OR THE TRANSACTIONS CONTEMPLATED HEREBY.

20. Counterparts. This Agreement may be executed in counterparts, each of which is deemed an original, but all of which together are deemed to be one and the same agreement. Notwithstanding anything to the contrary in Section 11, a signed copy of this Agreement delivered by facsimile, email, or other means of electronic transmission is deemed to have the same legal effect as delivery of an original signed copy of this Agreement.

21. Force Majeure. No Party shall be liable or responsible to the other Party, or be deemed to have defaulted under or breached this Agreement, for any failure or delay in fulfilling or performing any term of this Agreement (except for any obligations of the Customer to make payments to Service Provider hereunder), when and to the extent such failure or delay is caused by or results from acts beyond the impacted party's ("Impacted Party") control.

[SIGNATURE PAGE FOLLOWS]

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the Effective Date by their respective duly authorized officers.

HP RISK SOLUTIONS, LLC
By: /s/ William Bennett Carter, Jr.<br><br> <br>Name: William Bennett Carter, Jr.<br><br> <br>Title: General Counsel and Corporate Secretary
HG HOLDINGS, INC.
By: /s/ Steven A. Hale II<br><br> <br>Name: Steven A. Hale II<br><br> <br>Title: Chairman and CEO

EXHIBITS

EXHIBIT A

INITIAL STATEMENT OF WORK

Statement of Work

This Statement of Work ("SOW"), adopts and incorporates by reference the terms and conditions of the master agreement ("Master Agreement"), which was entered into on April 21, 2025, between HG Holdings, Inc., a Delaware corporation, with offices located at 2115 East 7^th^ Street, Suite 101, Charlotte, North Carolina 28204 ("Service Provider") and HP Risk Solutions, LLC, a Florida limited liability company, with offices located at 6265 Old Water Oak Road, Unit 204, Tallahassee, Florida 32312 ("Customer," and together with Service Provider, the "Parties," and each, a "Party"), as it may be amended from time to time. This SOW is effective beginning on June 1, 2025 and will remain in effect until May 31, 2028, unless earlier terminated in accordance with the Master Agreement. Transactions performed under this SOW will be conducted in accordance with and be subject to the terms and conditions of this SOW and the Master Agreement. Capitalized terms used but not defined in this SOW shall have the meanings set out in the Master Agreement.

1. Scope of Work. For Service Provider to provide managerial and operational oversight to include, but not be limited to:

●	Reinsurance Brokerage Services
●	Review and improvement of financial goals;
---	---
●	Compliance with legal and regulatory mandates;
---	---
●	Maintenance of an ethical business environment;
---	---
●	Investment and asset manager compliance;
---	---
●	Cash and equity management;
---	---
●	Corporate tax management;
---	---
●	Personnel management;
---	---
●	Related party transaction oversight;
---	---
●	Tax preparation administration;
---	---
●	Strategic capital modeling;
---	---
●	Review of potential acquisitions and transactions involving affiliates and third parties, including but not limited to, renewal rights deals, loss portfolio transfers or entity acquisitions;
---	---
●	Execution of (or provision for the execution of) all general corporate legal matters; and
---	---
●	Provisions of internal control management services.
---	---

2. Pricing. All costs listed below are based on the scope and assumptions included in this SOW. Annual amounts detailed below shall be paid pro rata monthly in arrears (i.e. first payment due 7/1/2025) upon the start of the Term.

Year	Price
6/1/25 – 5/31/26	$6,000,000 in 12 monthly installments of $500,000
6/1/26 – 5/31/27	$6,000,000 in 12 monthly installments of $500,000
6/1/27 - 5/31/28	$6,000,000 in 12 monthly installments of $500,000
Total:	$18,000,000

[SIGNATURE PAGE FOLLOWS]

IN WITNESS WHEREOF, the Parties hereto have executed this SOW as of the date first above written.

HP RISK SOLUTIONS, LLC
By: /s/ William Bennett Carter, Jr.<br><br> <br>Name: William Bennett Carter, Jr.<br><br> <br>Title: General Counsel and Corporate Secretary
HG HOLDINGS, INC.
By: /s/ Steven A. Hale II<br><br> <br>Name: Steven A. Hale II<br><br> <br>Title: Chairman and CEO