8-K

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

Date of Report (Date of Earliest Event Reported):     November 14, 2013

INNOTRAC CORPORATION

(Exact name of Registrant as Specified in its Charter)

Georgia	000-23741	58-1592285
(State or other Jurisdiction of Incorporation or Organization)	(Commission File Number)	(IRS Employer Identification No.)

6465 East Johns Crossing Johns Creek, GA	30097
(Address of principal executive offices)	(Zip code)

Registrant’s telephone number, including area code: (678) 584-4000

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 (see General Instruction A.2. below):

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

x 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))

ITEM 1.01       ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT

The Merger and the Merger Agreement 

On November 14, 2013, Innotrac Corporation, a Georgia corporation (“Innotrac”), entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Blue Eagle Holdings, L.P., a Delaware limited partnership (“Parent”), and Blue Eagle Acquisition Sub, Inc., a Georgia corporation and a wholly owned subsidiary of Parent (“Purchaser”). Parent and Purchaser are affiliates of Sterling Partners (“Sterling”).

Upon the terms and subject to the conditions of the Merger Agreement, Purchaser is required to commence, as promptly as practicable, a tender offer (the “Offer”) to acquire all of the outstanding shares of common stock, par value $0.10 per share, of Innotrac (the “Shares”) at a purchase price of $8.20 per share, in cash, subject to required withholding taxes and without interest (the “Offer Price”). Scott D. Dorfman, Innotrac’s Chairman, President, Chief Executive Officer and principal shareholder, and certain related parties have agreed not to tender Shares beneficially owned by them, as described below under “—Contribution and Support Agreement.” The Merger Agreement also provides that, following the completion of the Offer and subject to the satisfaction or waiver of certain conditions set forth in the Merger Agreement, Purchaser will merge with and into Innotrac, with Innotrac continuing as the surviving corporation and a wholly owned subsidiary of Parent (the “Merger”).

Promptly following the expiration of the Offer, Purchaser will accept and promptly pay for each Share validly tendered, and not withdrawn, pursuant to, and subject to the satisfaction or waiver, as applicable, of conditions to the Offer set forth in the Merger Agreement. Purchaser’s obligation to accept for payment and pay for all Shares validly tendered pursuant to the Offer is subject to: (i) the condition that the number of Shares validly tendered and not withdrawn, when added to the Shares owned by Parent and Purchaser, including Shares to be contributed to Parent pursuant to the Support Agreement described below, would represent as of the expiration of the Offer, (a) a majority of the Shares outstanding on a fully-diluted basis, and (b) a majority of the Shares outstanding on a fully-diluted basis other than Shares beneficially owned by Mr. Dorfman; and (ii) the satisfaction or waiver of other customary closing conditions as set forth in the Merger Agreement, including obtaining certain third party consents, the absence of a material adverse change and the expiration or termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended. Neither the Offer nor the Merger is subject to any financing condition.

Innotrac has granted Purchaser an irrevocable option to purchase a number of newly issued Shares, at a price per share equal to the Offer Price, that, when added to the Shares already owned by Parent, Purchaser, and their affiliates at the time of such exercise, will constitute one Share more than 90% of the total number of Shares outstanding on a fully-diluted basis immediately following the issuance of Shares pursuant to this option (the “Top-Up Option”). The Top-Up Option is intended to expedite the completion of the Merger. If Innotrac acquires at least 90% of the outstanding Shares through the Offer, or collectively through the Offer and the Top-Up Option, the Merger will be completed through “short-form” procedures under Georgia law, which would not require Innotrac to hold a meeting of its shareholders to vote on the adoption and approval of the Merger Agreement.

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In the event that the Offer is not completed, or if after the Offer is completed Purchaser does not own at least 90% of the outstanding Shares (including after giving effect to the Top-Up Option), the Merger will only be consummated if the shareholders of Innotrac have adopted and approved the Merger Agreement at a meeting of shareholders. In the event a shareholder meeting is held, the Merger Agreement will be adopted and the Merger will be approved if (i) at least a majority of the outstanding Shares vote in favor of adopting the Merger Agreement and approving the Merger and (ii) at least a majority of the outstanding Shares (excluding all Shares beneficially owned by Mr. Dorfman) vote in favor of adopting the Merger Agreement and approving the Merger. In the event a shareholder meeting is required to complete the Merger, the consummation of the Merger will be subject to closing conditions similar to those for the Offer, except that there is an additional condition in such case that the number of Shares with respect to which shareholders have demanded statutory appraisal rights does not exceed 5% of the number of Shares outstanding as of the date of the Merger Agreement. In the Merger, whether completed pursuant to the “short form” procedures or after shareholder approval, each outstanding Share (other than (i) Shares owned by Parent, Purchaser, Innotrac or any subsidiary of Innotrac and (ii) Shares as to which dissenters rights have been perfected (and not waived, withdrawn or lost) in accordance with applicable law) will be converted into the right to receive cash in an amount equal to the Offer Price.

The Merger Agreement includes customary representations, warranties and covenants, including, among others, a covenant by Innotrac to conduct its business in the ordinary course consistent with past practice during the interim period between the execution of the Merger Agreement and consummation of the Merger. The Merger Agreement also contains customary termination provisions for both Innotrac and Parent and provides that, in connection with the termination of the Merger Agreement under certain circumstances, Innotrac is required to pay Parent a termination fee, as described in more detail below. In the event the Merger Agreement is terminated in accordance with its terms, the Support Agreement described below will also terminate, subject to certain continuing obligations in certain circumstances.

Under the Merger Agreement, Innotrac and its subsidiaries are generally prohibited from soliciting, encouraging or otherwise taking any actions which would reasonably be expected to result in a proposal that constitutes, an alternative acquisition proposal. Notwithstanding this limitation, if prior to the closing of the Offer or prior to obtaining shareholder approval, as applicable, Innotrac’s board of directors (the “Board”) receives a bona fide alternative proposal, Innotrac may provide information in response to such alternative acquisition proposal, subject to the limitations and requirements set forth in the Merger Agreement, including that, prior to taking any such actions, (i) the Board has determined in good faith that such alternative proposal is, or is reasonably likely to lead to, a “superior proposal” as defined in the Merger Agreement, and (ii) the Board has determined that the failure to take such action is inconsistent with the directors’ fiduciary duties. Innotrac is required to promptly notify Parent after Innotrac’s receipt of any such alternative proposal and keep Parent reasonably informed of the status of such proposal. Furthermore, the Board is not permitted to change its recommendation to the shareholders in favor of the Offer and the Merger other than in limited, specified circumstances, including when the Board determines in good faith that (i) failure to take such action is inconsistent with the directors’ fiduciary duties and that an alternative proposal constitutes a superior proposal (but subject to Innotrac and the Board following the procedures set forth in the Merger Agreement, including that Innotrac has notified Parent and negotiated in good faith with Parent to enable the revision of the Merger Agreement such that the alternative proposal would no longer constitute a superior proposal), or (ii) such change is reasonably required to comply with its fiduciary duties in response to certain material developments constituting “intervening events” as defined in the Merger Agreement (again subject to procedures requiring Innotrac to notify Parent and engage in negotiations with Parent to amend the Merger Agreement in a manner that obviates the need for the Board to change its recommendation).

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In connection with the termination of the Merger Agreement under specified circumstances, including in connection with an adverse recommendation change by the Board or in the event Innotrac enters into an agreement in respect of a superior proposal, Innotrac would be required to pay a termination fee of $4,344,505 (the “Termination Fee”). Innotrac is also required to pay the reasonable expenses of Parent, Purchaser and their affiliates incurred in connection with the transaction, up to $1,500,000, under certain circumstances; provided, that, if the Termination Fee is subsequently paid, the Termination Fee will be reduced by the amount of any such expense reimbursement.

A special committee of the Board comprised solely of independent directors (the “Special Committee”) unanimously recommended that the Board, among other things, determine that it is in the best interests of Innotrac and its shareholders, including its unaffiliated shareholders, and declare it advisable, to enter into the Merger Agreement, approve the execution, delivery and performance by Innotrac of the Merger Agreement and recommend that the shareholders tender in the Offer, and, if applicable, vote their Shares in favor of adopting the Merger Agreement and approving the Merger. The Board accepted the Special Committee’s recommendations, and unanimously (other than Mr. Dorfman, who abstained) approved the Merger Agreement and the transactions contemplated therein.

The Merger Agreement has been attached to provide shareholders with information regarding its terms. It is not intended to provide any other factual information about Innotrac, Parent or Purchaser. The foregoing description of the material terms of the Merger Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the Merger Agreement, which is filed as Exhibit 2.1 to this Current Report on Form 8-K and is incorporated herein by reference. In particular, the representations, warranties and covenants contained in the Merger Agreement were made only for purposes of such agreement and as of specific dates, were made solely for the benefit of the parties to the Merger Agreement, and may be intended not as statements of fact, but rather as a way of allocating risk between Innotrac, Parent and Purchaser if those statements prove to be inaccurate. Moreover, the assertions embodied in the representations and warranties contained in the Merger Agreement are qualified by information in disclosure schedules provided by Innotrac in connection with the signing of the Merger Agreement. The schedules contain information that modifies, qualifies and creates exceptions to the representations and warranties set forth in the Merger Agreement. Furthermore, the representations and warranties may be subject to standards of materiality applicable to Innotrac, Parent and Purchaser that may be different from those which are applicable to Innotrac’s shareholders. Accordingly, the representations and warranties in the Merger Agreement may not constitute the actual state of facts about Innotrac, Parent or Purchaser.

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Equity Commitment Letter

In connection with the Merger Agreement, another Sterling affiliate, Sterling Capital Partners IV, L.P. (the “Guarantor”), delivered to Parent and Innotrac a letter dated November 14, 2013 (the “Commitment Letter”) in which the Guarantor committed, subject to the conditions set forth therein, to purchase equity securities of Parent in an aggregate amount of $119 million to allow Parent to pay in full all amounts required to be paid by Parent and Purchaser in connection with the consummation of the Merger. The Guarantor also irrevocably and unconditionally guaranteed the performance of Parent and Purchaser of the terms and provisions of the Merger Agreement in the Commitment Letter. Either Parent or Innotrac may enforce the Commitment Letter against the Guarantor.

The foregoing description of the material terms of the Commitment Letter does not purport to be complete and is qualified in its entirety by reference to the full text of the Commitment Letter, which is filed as Exhibit 2.2 to this Current Report on Form 8-K, and is incorporated by reference herein.

IPOF Fund Support Agreement

On November 14, 2013, Innotrac and the Parent entered into a Support Agreement (the “IPOF Agreement”) with the court appointed receiver (the “Receiver”) for all assets of any kind of IPOF L.P., IPOF Fund, and IPOF Fund II, L.P. The IPOF Agreement provides that, upon the terms and subject to the conditions set forth in the IPOF Agreement, the Receiver shall tender the shares owned by the IPOF Fund in the Offer and thereby receive the Offer Price from the Purchaser in the Offer. The IPOF Fund holds 4,321,771 Shares, or approximately 32.6% of the Shares currently outstanding. The IPOF Agreement also requires the Receiver to file a motion with the court requesting that the court (i) grant conditional and final approval of the IPOF Agreement, (ii) grant conditional and final approval of the sale of the Shares owned by the IPOF Fund, and (iii) issue a Bar Order pursuant to which all other participants in any litigation involving the IPOF Fund are barred from pursuing any claims against Innotrac or any of its affiliates.

The IPOF Agreement will only be effective if the court overseeing the IPOF Fund receivership approves the IPOF Agreement and the sale of the Shares owned by the IPOF Fund pursuant to the Merger Agreement, and the IPOF Agreement will terminate if the Merger Agreement terminates or if the Board no longer recommends the Merger to the shareholders.

The foregoing description of the material terms of the IPOF Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the IPOF Agreement, which is filed as Exhibit 10.1 to this Current Report on Form 8-K, and is incorporated by reference herein.

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Contribution and Support Agreement

Also on November 14, 2013, in connection with the Merger Agreement, Scott D. Dorfman, Innotrac’s Chairman, President and Chief Executive Officer and principal shareholder, together with individuals and entities related to Mr. Dorfman, entered into a Contribution and Support Agreement (the “Support Agreement”) with Parent. Pursuant to the Support Agreement, upon the terms and subject to the conditions set forth therein, Mr. Dorfman and certain related investors have agreed to contribute Shares constituting approximately 44.1% of the outstanding Shares in exchange for equity interests in Parent. Immediately following the Merger, Mr. Dorfman and such related investors have agreed to sell to one or more affiliates of Parent a portion of the equity interests in Parent acquired pursuant to the Support Agreement at the Offer Price. As a result of, and following, the foregoing transactions, it is expected that Mr. Dorfman and the related investors will own approximately 19.5% of the fully-diluted equity interests of Parent following the Merger.

Pursuant to the Support Agreement, Mr. Dorfman and the related investors have agreed not to tender Shares in the Offer, and are required to vote all of their Shares in favor of the approval of the Merger Agreement and the Merger, and to support actions necessary to consummate the Merger. Additionally, the Support Agreement prohibits Mr. Dorfman and the related investors from soliciting or knowingly facilitating inquiries or proposals relating to alternative business combination transactions.

The Support Agreement will terminate upon certain circumstances, including termination by its terms of the Merger Agreement; however certain support obligations of the investors continue for eighteen months following the termination of the Merger Agreement in connection with a Board recommendation change in response to an “intervening event,” as described above under “—The Merger and the Merger Agreement.”

The foregoing description of the material terms of the Support Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the Support Agreement, which is filed as Exhibit 10.2 to this Current Report on Form 8-K, and is incorporated by reference herein.

Subscription and Support Agreements

On November 14, 2013, two Innotrac executive officers—Robert J. Toner, Senior Vice President and Chief Operating Officer and Larry C. Hanger, Senior Vice President for Client Services—entered into subscription and support agreements with Parent pursuant to which they have agreed to invest 25% of the after-tax proceeds they receive as a result of the Merger into Parent equity securities. It is expected that these investments will result in Messrs. Toner and Hanger each acquiring less than one percent of the fully-diluted equity interests of Parent as of the closing of the Merger. In addition, they have agreed not to tender their Shares in the Offer, and to vote their Shares in favor of the Merger at any shareholder meeting. The foregoing description of the material terms of the subscription and support agreements does not purport to be complete and is qualified in its entirety by reference to the full text of the form of subscription and support agreement, which is filed as Exhibit 10.9 to this Current Report on Form 8-K, and is incorporated by reference herein.

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Airplane Lease

On November 14, 2013, Innotrac entered into an amended and restated aircraft lease with an affiliate of Mr. Dorfman, to be effective upon the consummation of the Merger (the “Airplane Lease”). The Airplane Lease provides for a “dry” lease by Innotrac of an airplane owned by Mr. Dorfman’s affiliate at an annual rent of $360,000, subject to an annual 2.5% increase during the term. The Airplane Lease expires on August 31, 2022 unless terminated earlier. The foregoing description of the material terms of the Airplane Lease does not purport to be complete and is qualified in its entirety by reference to the full text of the Airplane Lease, which is filed as Exhibit 10.3 to this Current Report on Form 8-K, and is incorporated by reference herein.

Additional Information About This Transaction

The Offer discussed above has not yet been commenced. This Current Report is neither an offer to purchase nor a solicitation of an offer to sell Shares of Innotrac. At the time the Offer is commenced, Parent, Purchaser and/or other affiliates of Sterling will file a Tender Offer Statement on Schedule TO containing an offer to purchase, a form of letter of transmittal and other documents relating to the Offer, and Innotrac will file a solicitation/recommendation statement on Schedule 14D-9 with respect to the Offer and, if necessary, a proxy statement regarding the subsequent Merger, in each case with the Securities and Exchange Commission (the “SEC”). The Offer will only be made pursuant to the offer to purchase, the letter of transmittal and related documents filed with the Schedule TO.

Investors and shareholders of INNOTRAC are ADVISED to read the tender offer statement and related materials (including the offer to purchase and letter of transmittal), the related solicitation/recommendation statement AND, IF NECESSARY, THE PROXY STATEMENT AND RELATED MATERIALS, as they may be amended and/or supplemented from time to time, when they become available, because they will contain important information that should be read prior to making a decision to tender OR VOTE SHARES. Investors will be able to obtain a free copy of these documents (when they become available) and other documents filed by Innotrac and Sterling’s affiliates with the SEC at the website maintained by the SEC at www.sec.gov. Copies of these documents can also be obtained, without charge, by directing a request to Innotrac Corporation, 6465 East Johns Crossing Suite 400, Johns Creek, Georgia 30097, Attn.: Secretary.

Innotrac and the Sterling affiliates involved in the transaction and their respective directors and executive officers and other members of management and employees may be deemed to be participating in the solicitation of proxies in respect of any future Merger subject to shareholder vote. Information regarding Innotrac’s directors and executive officers is available in Innotrac’s Annual Report on Form 10-K for its fiscal year ended December 31, 2012 filed with the SEC on March 30, 2013, and in its proxy statement for its 2013 annual meeting of shareholders filed on April 29, 2013. Additional information regarding the interests of such potential participants will be included in the proxy statement relating to the Merger and the other relevant documents filed with the SEC when they become available.

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Cautionary Note for Forward-Looking Statements

Statements in this Current Report, including the exhibits hereto, regarding the proposed transaction between affiliates of Sterling and Innotrac, the expected timetable for completing the transaction, the potential benefits of the transaction, and other statements about management’s future expectations, beliefs, goals, plans or prospects constitute forward looking statements. Innotrac has tried to identify these forward looking statements by using words such as “expect,” “anticipate,” “estimate,” “plan,” “would,” “should,” “forecast,” “believe,” “guidance,” “projection” or similar expressions, but these words are not the exclusive means for identifying such statements. Innotrac cautions that a number of risks, uncertainties and other important factors could cause actual developments relating to the Merger and related transactions and Innotrac’s results, performance and achievements to differ materially from the expectations expressed in, or implied by, the forward-looking statements, including, without limitation, uncertainties as to the timing of the Offer and Merger; uncertainties as to how many Innotrac shareholders will tender their Shares in the Offer; the risk that competing offers will be made; the possibility that various closing conditions for the transaction may not be satisfied or waived, including that a governmental entity may prohibit, delay or refuse to grant approval for the consummation of the transaction; any conditions imposed by governmental or regulatory authorities in connection with consummation of the tender offer and the merger; satisfaction of various other conditions to the completion of the Offer and the Merger contemplated by the Merger Agreement, including the condition related to obtaining certain third party consents; the risk that affiliates of Sterling will not perform their obligations under the Merger Agreement; and the risk factors set forth from time to time in Innotrac’s SEC filings, including the disclosures under “Risk Factors” in those filings. Except as expressly required by the federal securities laws, Innotrac undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, changed circumstances or future events or for any other reason.

ITEM 5.02       DEPARTURE OF DIRECTORS OR CERTAIN OFFICERS; ELECTION OF DIRECTORS; APPOINTMENT OF CERTAIN OFFICERS; COMPENSATORY ARRANGEMENTS OF CERTAIN OFFICERS.

On November 14, 2013, Messrs. Dorfman, Toner and Hanger and the following additional executive officers of Innotrac—Stephen G. Keaveney, Chief Financial Officer and Corporate Secretary, and Edgar L. Ringer, Senior Vice President and Chief Information Officer—entered in employment agreements with Innotrac, which will be effective upon the consummation of the Merger (the “Employment Agreements”). These agreements, which were approved by the Compensation Committee of the Board, replace any previous employment agreements such executives had with Innotrac. The Employment Agreements provide for the following initial base salaries: $426,950 (Mr. Dorfman), $300,000 (Mr. Toner), $236,950 (Mr. Hanger), $250,000 (Mr. Keaveney), and $215,000 (Mr. Ringer); standard employee benefits; customer and employee non-solicitation covenants with a post termination period of 24 months; and non-compete covenants with a post termination period of 24 months in the case of Mr. Dorfman, and 12 months in the case of the other executives. The Employment Agreements also provide for establishment of an incentive bonus plan, but do not specify bonus opportunity amounts.

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The Employment Agreements provide for “at will” employment, but upon termination without “cause” or a resignation for a “good reason,” (both as defined in the Employment Agreements) the executives will be entitled to severance compensation including salary continuation and continuation of health and welfare benefit during their respective severance period (18 months for Mr. Dorfman, six months for Mr. Ringer and nine months for the remaining executives).

Pursuant to the Employment Agreements, the executives other than Mr. Dorfman have been offered options to acquire equity securities of Parent, subject to a four year vesting schedule, in amounts equal to 2.0%, 1.25%, 1.25%, and 0.5% of the fully-diluted outstanding equity of Parent as of the effective time of the Merger, for Messrs. Toner, Hanger, Keaveney and Ringer, respectively. Any unvested options will be forfeited upon a termination of employment for any reason, and all vested and unvested options will be subject to forfeiture and cancellation upon a termination for cause.

Mr. Dorfman’s Employment Agreement additionally provides him with use of a company car and reimbursement of annual dining club dues.

In addition, on November 14, 2013, the Compensation Committee approved a discretionary transaction success cash bonus for Mr. Keaveney. While the bonus is discretionary, the guidelines for the bonus indicate that for a transaction where the merger consideration is between $100-$120 million the bonuses should be $200,000.

The foregoing description of the material terms of the Employment Agreements does not purport to be complete and is qualified in its entirety by reference to the full text of such agreements, which are filed as Exhibits 10.4 (Mr. Dorfman), 10.5 (Mr. Toner), 10.6 (Mr. Hanger), 10.7 (Mr. Keaveney), and 10.8 (Mr. Ringer) to this Current Report on Form 8-K, and are incorporated by reference herein.

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ITEM 9.01       FINANCIAL STATEMENTS AND EXHIBITS

Exhibit No.	Description
2.1	Agreement and Plan of Merger dated November 14, 2013 among Blue Eagle Holdings, L.P., Blue Eagle Acquisition Sub, Inc. and Innotrac Corporation
2.2	Equity Commitment Letter of Sterling Capital Partners IV, L.P. dated November 14, 2013
10.1	Support Agreement, dated November 14, 2013, between Innotrac Corporation, Mark E. Dottore, as the Court appointed receiver for all assets of any kind of IPOF L.P., IPOF Fund, and IPOF Fund II, L.P. and Blue Eagle Holdings, L.P.
10.2	Contribution and Support Agreement, dated November 14, 2013, between Blue Eagle Holdings, L.P., Scott D. Dorfman and the Other Investors Named Therein
10.3	Amended and Restated Aircraft Lease by and between SDD Holdings, Inc. and Innotrac Corporation dated November 14, 2013
10.4	Amended and Restated Employment Agreement dated November 14, 2013 between Innotrac Corporation and Scott D. Dorfman
10.5	Amended and Restated Employment Agreement dated November 14, 2013 between Innotrac Corporation and Robert J. Toner
10.6	Amended and Restated Employment Agreement dated November 14, 2013 between Innotrac Corporation and Larry C. Hanger
10.7	Employment Agreement dated November 14, 2013 between Innotrac Corporation and Stephen G. Keaveney
10.8	Employment Agreement dated November 14, 2013 between Innotrac Corporation and Edgar L. Ringer
10.9	Form of Subscription and Support Agreement, dated November 14, 2013, between Blue Eagle Holdings, L.P. and the Investor Named Therein

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SIGNATURES

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

	INNOTRAC CORPORATION
Dated: November 15, 2013	By:	/s/ Stephen G. Keaveney
		Stephen G. Keaveney
		Chief Financial Officer and Secretary

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EX-2.1

EXHIBIT 2.1

EXECUTION COPY

AGREEMENT AND PLAN OF MERGER

dated as of November 14, 2013,

among

BLUE EAGLE HOLDINGS, L.P.,

BLUE EAGLE ACQUISITION SUB, INC.

and

INNOTRAC CORPORATION

*The filed version of this Agreement and Plan of Merger omits the Disclosure Schedules identified in the text of this Agreement. The registrant agrees to furnish supplementally a copy of any omitted schedule to the Securities & Exchange Commission upon request.

TABLE OF CONTENTS

		Page
ARTICLE I. THE OFFER AND THE MERGER		3
Section 1.01.	The Offer	3
Section 1.02.	Company Actions	5
Section 1.03.	Top-Up Option	6
Section 1.04.	Directors	7
Section 1.05.	The Merger	8
Section 1.06.	Closing	9
Section 1.07.	Effective Time	9
Section 1.08.	Effects of the Merger	9
Section 1.09.	Articles of Incorporation and Bylaws	9
Section 1.10.	Officers and Directors	10
ARTICLE II. EFFECT OF MERGER ON CAPITAL STOCK OF CONSTITUENT CORPORATIONS; COMPANY STOCK OPTIONS; EXCHANGE OF CERTIFICATES		10
Section 2.01.	Effect on Capital Stock	10
Section 2.02.	Dissenting Shares	11
Section 2.03.	Restricted Stock; Company Stock Options; Withholding	11
Section 2.04.	Certain Adjustments	13
Section 2.05.	Exchange of Common Stock Certificates and Book-Entry Shares; Paying Agent	13
ARTICLE III. REPRESENTATIONS AND WARRANTIES		15
Section 3.01.	Representations and Warranties of the Company	15
Section 3.02.	Representations and Warranties of Parent and Purchaser	36
ARTICLE IV. COVENANTS RELATING TO CONDUCT OF BUSINESS; NO SOLICITATION		39
Section 4.01.	Conduct of Business by the Company	39
Section 4.02.	No Solicitation	42
ARTICLE V. ADDITIONAL AGREEMENTS		46
Section 5.01.	Schedule 13E-3; Proxy Statement.	46
Section 5.02.	Access to Information; Confidentiality	48
Section 5.03.	Reasonable Best Efforts	49
Section 5.04.	Indemnification; Advancement of Expenses; Exculpation and Insurance	51
Section 5.05.	Fees and Expenses	52
Section 5.06.	Public Announcements	53

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Section 5.07.	Notification of Certain Matters	53
Section 5.08.	Employee Matters	53
Section 5.09.	Financing	54
Section 5.10.	State Takeover Laws	55
Section 5.11.	Director Resignations	55
Section 5.12.	Section 16 Matters	55
Section 5.13.	Company SEC Documents	56
Section 5.14.	Shareholder Litigation	56
Section 5.15.	Rule 14d-10 Matters	56
ARTICLE VI. CONDITIONS PRECEDENT		56
Section 6.01.	Conditions to Each Party’s Obligation to Effect the Transaction	56
Section 6.02.	Conditions to Obligations of Parent and Purchaser	57
Section 6.03.	Conditions to Obligations of the Company	58
Section 6.04.	Frustration of Closing Conditions	58
ARTICLE VII. TERMINATION, AMENDMENT AND WAIVER		58
Section 7.01.	Termination	58
Section 7.02.	Termination Fee; Expenses	60
Section 7.03.	Effect of Termination	61
ARTICLE VIII. GENERAL PROVISIONS		62
Section 8.01.	Nonsurvival of Representations and Warranties	62
Section 8.02.	Notices	62
Section 8.03.	Definitions	63
Section 8.04.	Interpretation	66
Section 8.05.	Amendments	67
Section 8.06.	Waiver	67
Section 8.07.	Consents and Approvals	67
Section 8.08.	Counterparts; Effectiveness	67
Section 8.09.	Entire Agreement; No Third-Party Beneficiaries	67
Section 8.10.	GOVERNING LAW	68
Section 8.11.	Assignment	68
Section 8.12.	Specific Enforcement; Consent to Jurisdiction	68
Section 8.13.	Waiver of Jury Trial	70
Section 8.14.	Severability	70

Annex I	Officers of Surviving Corporation
Annex II	Index of Defined Terms
Annex III	Conditions to the Offer

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AGREEMENT AND PLAN OF MERGER

This AGREEMENT AND PLAN OF MERGER (this “Agreement”), dated as of November 14, 2013, is among Blue Eagle Holdings, L.P., a Delaware limited partnership (“Parent”), Blue Eagle Acquisition Sub, Inc., a Georgia corporation and a wholly owned Subsidiary of Parent (“Purchaser”), and Innotrac Corporation, a Georgia corporation (the “Company”). Capitalized terms used in this Agreement are used as defined in Section 8.03.

RECITALS

WHEREAS, upon the terms and subject to the conditions set forth herein, Parent has agreed to cause Purchaser to commence a tender offer (the “Offer”) to purchase all of the outstanding shares of common stock of the Company, par value $0.10 per share (the “Common Stock”), at a price per share of Common Stock of $8.20 (such amount or any other amount per share paid pursuant to the Offer and this Agreement, the “Offer Price”), payable to the seller thereof in cash, without interest, subject to any withholding of taxes required by applicable Law;

WHEREAS, immediately following the Offer Closing and upon the terms and subject to the conditions set forth herein, Purchaser will be merged with and into the Company with the Company as the Surviving Corporation (the “Merger,” and together with the Offer, the Top-Up Option (including the issuance of newly-issued shares of Common Stock pursuant to the exercise thereof in accordance with the terms of this Agreement) and the other transactions contemplated by this Agreement, the “Transaction”) in accordance with the Georgia Business Corporation Code (as amended, the “GBCC”), whereby each issued and outstanding share of Common Stock (other than Excluded Shares) will be converted into the right to receive the Offer Price in cash, without interest, subject to any withholding of taxes required by applicable Law;

WHEREAS, the Board of Directors of the Company (the “Board”) formed a standing committee of the Board, consisting only of independent and disinterested members of the Board, for the purpose of evaluating strategic opportunities and alternatives for the Company (the “Committee”);

WHEREAS, the Committee evaluated and made a unanimous recommendation to the full Board to approve the execution, delivery and performance of this Agreement and the Transaction, and, in the event that the shareholders of the Company must vote to approve the Merger in order to consummate the Transaction, to recommend the adoption of this Agreement and the Merger by the shareholders of the Company;

WHEREAS, the Board, acting upon the unanimous recommendation of the Committee, and on the terms and subject to the conditions set forth herein, has unanimously (other than Scott D. Dorfman, who recused himself) (i) determined that it is in the best interests of the Company and its shareholders, and declared it advisable, to enter into this Agreement, (ii) approved the execution, delivery and performance by the Company of this Agreement and the Transaction, and (iii) resolved to recommend that the shareholders of the Company accept the Offer and tender their shares of Common Stock to Purchaser in the Offer and, in the event that the shareholders of the Company must vote to approve the Merger in order to consummate the Transaction, to recommend the adoption of this Agreement and the Merger by the shareholders of the Company;

WHEREAS, the Board of Directors of each of Parent and Purchaser, on the terms and subject to the conditions set forth herein, have unanimously approved and declared advisable this Agreement and the Transaction;

WHEREAS, immediately prior to the execution and delivery of this Agreement, and as a condition and inducement to the willingness of Parent and Purchaser to enter into this Agreement, certain shareholders of the Company entered into a contribution and support agreement with Parent (the “Contribution Agreement”) pursuant to which each such shareholder has agreed to, among other things, contribute, and not tender, certain shares of Common Stock owned by such shareholder (the “Contributed Shares”) to Parent following Purchaser’s acceptance of the shares of Common Stock tendered pursuant to the Offer in exchange for equity securities in Parent;

WHEREAS, immediately prior to the execution and delivery of this Agreement, and as a condition and inducement to the willingness of Parent and Purchaser to enter into this Agreement, certain shareholders of the Company entered into subscription and support agreements with Parent (the “Subscription Agreements”) pursuant to which each such shareholder has agreed to, among other things, not tender certain shares of Common Stock owned by such shareholder and purchase equity securities in Parent immediately following Purchaser’s acceptance of the shares of Common Stock tendered pursuant to the Offer;

WHEREAS, immediately prior to the execution and delivery of this Agreement, and as a condition and inducement to the willingness of Parent and Purchaser to enter into this Agreement, certain members of the Company’s senior management have entered into employment agreements with the Company (the “Employment Agreements”), which are conditioned upon, and shall become effective at, the Effective Time;

WHEREAS, immediately prior to the execution and delivery of this Agreement, and as a condition and inducement to the willingness of Parent and Purchaser to enter into this Agreement, the Company has entered into an Amended and Restated Aircraft Lease with SDD Holdings, Inc. (the “Aircraft Lease”), which is conditioned upon, and shall become effective at, the Effective Time;

WHEREAS, the Committee, or the Compensation Committee of the Board of Directors of the Company (the “Compensation Committee”), has approved each Employment Agreement and the Aircraft Lease as an “employment compensation, severance or other employee benefit arrangement” pursuant to Rule 14d-10(d)(2) promulgated under the Exchange Act;

WHEREAS, concurrently with the execution and delivery of this Agreement, and as a condition and inducement to the willingness of the Company to enter into this Agreement, the Guarantor has entered into an equity commitment letter in favor of Parent and the Company (the “Equity Commitment Letter”) pursuant to which the Guarantor has committed, subject to the terms and conditions of the Equity Commitment Letter, to invest the Equity Financing; and

WHEREAS, Parent, Purchaser and the Company desire to make certain representations, warranties, covenants and agreements in connection with the Transaction and also to prescribe various conditions to the Transaction.

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AGREEMENT

NOW, THEREFORE, in consideration of the representations, warranties, covenants and agreements contained in this Agreement, and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, and subject to the conditions set forth herein, the parties intending to be legally bound hereto agree as follows:

ARTICLE I.
THE OFFER AND THE MERGER

Section 1.01.         The Offer.

(a)          As promptly as practicable following the receipt of information required to be furnished by the Company pursuant to Section 1.01(e), Purchaser shall, and Parent shall cause Purchaser to, commence, within the meaning of Rule 14d-2 promulgated under the Exchange Act, the Offer. The Offer shall initially expire at 5:00 p.m. (Chicago time) on the date that is twenty (20) Business Days following the commencement of the Offer (determined using Rule 14d-1(g)(3) promulgated under the Exchange Act).

(b)          The consummation of the Offer, and the obligation of Purchaser to accept for payment and pay for shares of Common Stock tendered pursuant to the Offer shall be subject to the conditions set forth in Annex III (the “Offer Conditions”). The Offer Conditions are for the sole benefit of Parent and Purchaser and may be asserted by Purchaser and Purchaser regardless of the circumstances giving rise to such condition and, other than the Non-Waivable Conditions, may be waived by Purchaser, in its sole discretion, in whole or in part. Without the prior written consent of the Company, Purchaser shall not, and Parent shall not permit Purchaser to, (i) reduce the number of shares of Common Stock subject to the Offer, (ii) reduce the Offer Price, (iii) amend or modify the Minimum Condition, (iv) add to the Offer Conditions or amend, modify or supplement any Offer Condition in any manner adverse to any holder of Common Stock, (v) except as permitted by this Section 1.01(b), terminate, extend or otherwise modify the expiration date of the Offer, (vi) change the form of consideration payable in the Offer or (vii) otherwise amend, modify or supplement any of the terms of the Offer in any manner adverse to any holder of Common Stock. Notwithstanding any other provision of this Agreement to the contrary, Purchaser shall, and Parent shall cause Purchaser to, (A) extend the Offer on one or more occasions, in consecutive increments of up to five (5) Business Days (or such longer period as the parties hereto may agree) each, if, at any then-scheduled expiration of the Offer, any Offer Condition shall not have been satisfied or, other than the Non-Waivable Conditions, waived, until such time as each such condition shall have been satisfied or, other than the Non-Waivable Conditions, waived and (B) extend the Offer for the minimum period required by any rule, regulation, interpretation or position of the SEC (or the staff of the SEC) applicable to the Offer. Notwithstanding any other provision of this Agreement to the contrary, if, at any then-scheduled expiration of the Offer, the Minimum Condition shall not have been satisfied, but each Offer Condition shall have been satisfied or, other than the Non-Waivable Conditions, waived, then Purchaser may and, if requested by the Company, Purchaser shall, and Parent shall cause Purchaser to, extend the Offer by increments of five (5) Business Days; provided, however, Purchaser may not extend the Offer by more than thirty (30) Business Days (unless required by the SEC or applicable Law) without the consent of the Company. For the avoidance of doubt, nothing in this Agreement shall be deemed to require Purchaser to extend the Offer beyond the Offer End Date.

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(c)          Subject to the satisfaction of the Non-Waivable Conditions and the satisfaction or waiver of the other Offer Conditions, Purchaser shall, and Parent shall cause Purchaser to, accept for payment, and pay for, all shares of Common Stock that Purchaser becomes obligated to purchase pursuant to the Offer promptly after the expiration of the Offer. Payment for shares of Common Stock by Purchaser pursuant to and subject to the conditions of the Offer is referred to in this Agreement as the “Offer Closing”, and the date on which the Offer Closing occurs is referred to in this Agreement as the “Offer Closing Date”. The Offer may not be terminated prior to its expiration date (as such expiration date may be extended and re-extended in accordance with Section 1.01(b)), unless this Agreement is validly terminated in accordance with Section 7.01. If (i) at any then-scheduled expiration of the Offer, (A) each Offer Condition (other than the Minimum Condition) shall have been satisfied or, other than the Non-Waivable Conditions, waived, (B) the Minimum Condition shall not have been satisfied and (C) no further extensions or re-extensions of the Offer are permitted or required pursuant to Section 1.01(b) or (ii) this Agreement is terminated pursuant to Section 7.01, then, in each case, Purchaser shall promptly (and, in any event, within twenty four (24) hours of such termination), irrevocably and unconditionally terminate the Offer. The termination of the Offer pursuant to clause (i) of the immediately preceding sentence is referred to in this Agreement as the “Offer Termination”. If the Offer is terminated or withdrawn by Purchaser, or this Agreement is terminated in accordance with Section 7.01, Purchaser shall promptly return, and shall cause any depository acting on behalf of Purchaser to return, all tendered shares of Common Stock to the registered holders thereof.

(d)          Parent shall provide, or cause to be provided, to Purchaser on a timely basis the funds necessary to purchase any shares of Common Stock that Purchaser becomes obligated to purchase pursuant to the Offer.

(e)          On the date of commencement of the Offer, Parent and Purchaser shall file with the SEC, in accordance with Rule 14d-3 promulgated under the Exchange Act, a Tender Offer Statement on Schedule TO with respect to the Offer (together with all amendments, supplements and exhibits thereto, the “Schedule TO”), which shall include, as exhibits, (i) an offer to purchase and a related letter of transmittal, (ii) a summary advertisement and (iii) other ancillary Offer documents pursuant to which the Offer will be made (such Schedule TO and the documents attached as exhibits thereto, together with any amendments or supplements thereto, the “Offer Documents”). Parent and Purchaser shall mail the Offer Documents to the holders of Common Stock promptly after filing the Schedule TO with the SEC. The Company shall promptly furnish in writing to Parent and Purchaser all information concerning the Company that is required by the Exchange Act to be set forth in the Offer Documents and the Schedule 13E-3. Each of Parent, Purchaser and the Company shall promptly correct any information provided by it for use in the Offer Documents if and to the extent that such information shall have become false or misleading in any material respect, and each of Parent and Purchaser shall take all steps necessary to amend or supplement the Offer Documents and to cause the Offer Documents, as so amended or supplemented, to be filed with the SEC and disseminated to the Company’s shareholders, in each case as and to the extent required by the Exchange Act. Parent and Purchaser shall promptly notify the Company upon the receipt of any comments from the SEC (or the staff of the SEC) or any request from the SEC (or the staff of the SEC) for amendments or supplements to the Offer Documents, and shall provide the Company with copies of all correspondence (or telephonic notice of any oral responses or discussions) between Parent and Purchaser, on the one hand, and the SEC (or the staff of the SEC), on the other hand. Parent and Purchaser shall use reasonable best efforts to respond as promptly as reasonably practicable to any comments of the SEC (or the staff of the SEC) with respect to the Offer Documents. Prior to the filing of the Offer Documents (or any amendment or supplement thereto) or the dissemination thereof to the shareholders of the Company, or responding to any comments of the SEC (or the staff of the SEC) with respect thereto, Parent and Purchaser shall provide the Company a reasonable opportunity to review and to propose comments on such document or response.

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Section 1.02.        Company Actions.

(a)          On the date the Offer Documents are initially filed with the SEC, the Company shall, in a manner that complies with Rule 14d-9 promulgated under the Exchange Act, file with the SEC a Tender Offer Solicitation/Recommendation Statement on Schedule 14D-9 with respect to the Offer (together with all amendments, supplements and exhibits thereto, the “Schedule 14D-9”). The Schedule 14D-9 shall (i) reflect the terms and conditions of this Agreement, (ii) include a copy of the opinion referred to in Section 3.01(r) and the notice of appraisal rights in the Merger to holders of Common Stock required by Section 14-2-1302, et seq. of the GBCC and (iii) subject to Section 4.02(g), describe and make the Company Recommendation with respect to the Offer. The Company shall mail the Schedule 14D-9 to the holders of Common Stock promptly after filing the Schedule 14D-9 with the SEC. The Company and Parent shall cooperate to cause the Schedule 14D-9 to be mailed to the holders of Common Stock together with the Offer Documents. A Company Adverse Recommendation Change effected by the Board in accordance with Section 4.02(g), however, will not relieve the Company from its obligations hereunder other than as set forth in the prior sentence, and unless this Agreement is terminated in accordance with Section 7.01, the Company shall remain obligated to disseminate the Schedule 14D-9 to the holders of Common Stock. Parent and Purchaser shall promptly furnish to the Company all information concerning Parent and Purchaser that is required by the Exchange Act to be set forth in the Schedule 14D-9 and the Schedule 13E-3. Each of the Company, Parent and Purchaser shall promptly correct any information provided by it for use in the Schedule 14D-9, if and to the extent that such information shall have become false or misleading in any material respect, and the Company shall take all steps necessary to amend or supplement the Schedule 14D-9 and to cause the Schedule 14D-9, as so amended or supplemented, to be filed with the SEC and disseminated to the holders of Common Stock, in each case as and to the extent required by the Exchange Act. The Company shall promptly notify Parent upon the receipt of any comments from the SEC (or the staff of the SEC) or any request from the SEC (or the staff of the SEC) for amendments or supplements to the Schedule 14D-9, and shall provide Parent with copies of all correspondence (or telephonic notice of any oral responses or discussions) between the Company, on the one hand, and the SEC (or the staff of the SEC), on the other hand. The Company shall use its reasonable best efforts to respond as promptly as reasonably practicable to any comments of the SEC (or the staff of the SEC) with respect to the Schedule 14D-9. Prior to the filing of the Schedule 14D-9 (or any amendment or supplement thereto) or the dissemination thereof to the shareholders of the Company, or responding to any comments of the SEC (or the staff of the SEC) with respect thereto, the Company shall provide Parent a reasonable opportunity to review and to propose comments on such document or response. The Company hereby consents to the inclusion in the Offer Documents of the Company Recommendation.

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(b)          In connection with the Offer, the Company shall cause its transfer agent to furnish Purchaser promptly (and in any event within five (5) Business Days after the date of this Agreement) with mailing labels containing the names and addresses of the record holders of Common Stock as of the most recent practicable date, and of those persons becoming record holders subsequent to such date, together with copies of all lists of shareholders, security position listings, computer files and all other information in the Company’s possession or control regarding the beneficial owners of Common Stock, and shall furnish to Purchaser such information (including updated lists of shareholders, security position listings and computer files) as Parent may reasonably request in communicating the Offer to the Company’s shareholders.

Section 1.03.        Top-Up Option.

(a)          The Company hereby grants to Purchaser an irrevocable option (the “Top-Up Option”), exercisable only on the terms and conditions set forth in this Section 1.03, to purchase at a price per share equal to the Offer Price that number of newly issued, fully paid and nonassessable shares of Common Stock (the “Top-Up Option Shares”) equal to the lowest number of shares of Common Stock that, when added to the number of shares of Common Stock directly or indirectly owned by Parent and Purchaser at the time of exercise of the Top-Up Option, shall constitute one share more than ninety percent (90%) of the shares of Common Stock outstanding on a “fully diluted basis” immediately after the issuance of the Top-Up Option Shares; provided, however, that the Top-Up Option may not be exercised to the extent that the number of Top-Up Option Shares exceeds that number of shares of Company Common Stock authorized and unissued (treating shares owned by the Company as treasury stock as unissued) and not reserved for issuance at the time of exercise of the Top-Up Option or as may be otherwise limited by any applicable legal requirement set forth in any applicable statute or any rule or order enacted by any governmental agency pursuant thereto. The Top-Up Option shall be exercisable only once, in whole but not in part.

(b)          The parties shall cooperate to ensure that the issuance and delivery of the Top-Up Option Shares complies with all applicable Laws, including compliance with an applicable exemption from registration of the Top-Up Option Shares under the Securities Act. If there shall have not been validly tendered and not validly withdrawn that number of shares of Common Stock which, when added to the shares of Common Stock owned by Parent and Purchaser, would represent at least ninety percent (90%) of the shares of Company Common Stock outstanding on a “fully diluted” basis on the Offer Closing Date, Purchaser shall be deemed to have exercised the Top-Up Option on such date (the “Top-Up Exercise Date”). On the Top-Up Exercise Date, (i) Parent shall give the Company written notice specifying the number of shares of Common Stock directly or indirectly owned by Parent and Purchaser at the time of such notice (giving effect to the Offer Closing) and (ii) the Company shall, immediately following receipt of such notice on the Top-Up Exercise Date, deliver written notice to Purchaser specifying, based on the information provided by Parent in its notice, the number of Top-Up Option Shares. At the closing of the purchase of the Top-Up Option Shares (the “Top-Up Closing”), which shall take place at the location specified in Section 1.06 and shall be deemed to occur immediately following the Offer Closing and immediately preceding the Effective Time, the purchase price owed by Purchaser to the Company therefor shall be paid to the Company, at Purchaser’s option, (i) in cash, by wire transfer of same-day funds, or (ii) by (x) paying in cash, by wire transfer of same-day funds, an amount equal to not less than the aggregate par value of the Top-Up Option Shares and (y) executing and delivering to the Company a promissory note having a principal amount equal to the aggregate purchase price pursuant to the Top-Up Option less the amount paid in cash pursuant to the preceding clause (x) (the “Promissory Note”). The Promissory Note (i) shall be due on the first anniversary of the Top-Up Closing, (ii) shall bear simple interest of five percent (5%) per annum, (iii) shall be full recourse to Purchaser, (iv) may be prepaid, in whole or in part, at any time without premium or penalty, and (v) shall have no other material terms. At the Top-Up Closing, the Company shall cause to be issued to Purchaser a certificate representing the Top-Up Option Shares.

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(c)          Any dilutive impact on the value of the shares of Common Stock as a result of the issuance of the Top-Up Option Shares will not be taken into account in any determination of the fair value of any Dissenting Shares pursuant to Section 14-2-1302, et seq. of the GBCC.

Section 1.04.       Directors.

(a)          Subject to applicable Law and provided that the Minimum Condition is satisfied, promptly after the Offer Closing, and at all times thereafter, Purchaser shall be entitled to elect or designate such number of directors, rounded up to the next whole number, on the board of directors of the Company as is equal to the product of the total number of directors on the board of directors of the Company (giving effect to the directors elected or designated by Purchaser pursuant to this sentence) multiplied by the percentage that the aggregate number of shares of Common Stock beneficially owned by Parent and Purchaser bears to the total number of shares of Company Common Stock then outstanding; provided, however, that, subject to applicable Law and the rules and regulations of Nasdaq, Purchaser shall be entitled to designate at least a majority of the directors on the Board at all times following the Offer Closing. Upon Purchaser’s request at any time following the Offer Closing, the Company shall, subject to the terms of the Organizational Documents of the Company, take such actions, including but not limited to filling vacancies or newly created directorships on the board of directors of the Company, increasing the size of the board of directors of the Company (including by amending the bylaws of the Company if necessary so as to increase the size of the board of directors of the Company) and/or requesting and accepting the resignations of such number of its incumbent directors, as is reasonably necessary to enable Purchaser’s designees to be so elected or designated to the board of directors of the Company, and shall cause Purchaser’s designees to be so elected or designated at such time. The Company shall, upon Purchaser’s request following the Offer Closing, also cause Persons elected or designated by Purchaser to constitute at least the same percentage (rounded up to the next whole number) as is on the board of directors of the Company of (i) each committee of the board of directors of the Company, (ii) each board of directors (or similar body) of each subsidiary of the Company, and (iii) each committee (or similar body) of each such board, in each case to the extent permitted by applicable Law and the rules and regulations of Nasdaq. The Company’s obligations under this Section 1.04(a) shall be subject to Section 14(f) of the Exchange Act and Rule 14f-1 of the Exchange Act. The Company shall promptly upon execution of this Agreement take all actions required pursuant to Section 14(f) and Rule 14f-1 in order to fulfill its obligations under this Section 1.04(a), including mailing to the Company’s shareholders (together with the Schedule 14D-9, unless otherwise requested by Parent) the information required by Section 14(f) and Rule 14f-1 as is necessary to enable Purchaser’s designees to be elected or designated to the board of directors of the Company. Parent shall supply the Company with, and solely be responsible for, information with respect to Purchaser’s designees and Parent’s and Purchaser’s respective officers, directors and affiliates to the extent required by Section 14(f) and Rule 14f-1. The provisions of this Section 1.04(a) are in addition to and shall not limit any rights that any of Purchaser, Parent or any of their respective affiliates may have as a record holder or beneficial owner of shares of Common Stock as a matter of applicable Law with respect to the election of directors or otherwise.

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(b)          In the event that Purchaser’s designees are elected or designated to the board of directors of the Company pursuant to Section 1.04(a), then, until the Effective Time, the Company shall use its reasonable efforts to cause the board of directors of the Company to maintain three directors who are members of the board of directors of the Company on the date of this Agreement, each of whom shall be “independent” for purposes of Rule 10A-3 of the Exchange Act and also eligible to serve on the Company’s audit committee under the Exchange Act and Nasdaq rules and regulations and at least one of whom shall be an “audit committee financial expert” as defined in Item 407(d)(5)(ii) of Regulation S-K and the instructions thereto (the “Continuing Directors”); provided, however, that if any Continuing Director is unable to serve due to death, disability or resignation, the Company shall take all necessary action (including creating a committee of the board of directors of the Company) so that the Continuing Director(s) shall be entitled to elect or designate another person (or persons) to fill such vacancy, and such person (or persons) shall be deemed to be a Continuing Director for purposes of this Agreement. If no Continuing Director then remains, the other directors shall designate three persons who shall each qualify as “independent” for purposes of Rule 10A-3 promulgated under the Exchange Act and eligible to serve on the Company’s audit committee under the Exchange Act and Nasdaq rules and regulations and at least one of whom shall be an “audit committee financial expert” as defined in Item 407(d)(5)(ii) of Regulation S-K and the instructions thereto, to fill such vacancies and such persons shall be deemed Continuing Directors for all purposes of this Agreement. Notwithstanding anything in this Agreement to the contrary, if any of Purchaser’s designees have been elected or appointed to the board of directors of the Company after the Offer Closing and prior to the Effective Time, then the affirmative vote of a majority of the Continuing Directors shall (in addition to the approval rights of the shareholders of the Company as may be required by the governing documents of the Company or applicable Law) be required (and upon such vote the Company will be deemed authorized without any further vote of the board of directors) for the Company (i) to amend or terminate this Agreement, (ii) to extend the time of performance of, or waive, any of the obligations or other acts of Parent or Purchaser under this Agreement, or to exercise or waive any of the Company’s rights, benefits or remedies hereunder, (iii) except as provided herein, to amend the governing documents of the Company, or (iv) to take any other action or make any other determination of the board of directors of the Company under or in connection with this Agreement or the Transaction. The Continuing Directors shall have, and Purchaser shall cause the Continuing Directors to have, the authority to retain such counsel (which may include current counsel to the Company or the board of directors of the Company) and other advisors at the expense of the Company as determined by the Continuing Directors, and the authority to institute any action on behalf of the Company to enforce performance of this Agreement. Following the Offer Closing and prior to the Effective Time, neither Parent nor Purchaser shall take any action to remove any Continuing Director.

Section 1.05.       The Merger. Upon the terms and subject to the conditions set forth in this Agreement, and in accordance with the GBCC, at the Effective Time, (a) Purchaser shall be merged with and into the Company and the separate corporate existence of Purchaser shall cease and (b) the Company shall continue as the surviving corporation in the Merger (the “Surviving Corporation”) and shall succeed to and assume all the rights and obligations of Purchaser in accordance with the GBCC. The Merger shall be governed by Section 14-2-1104 of the GBCC and shall be effected as soon as practicable following the Offer Closing.

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Section 1.06.       Closing. The closing of the Merger (the “Closing”) will take place (i) promptly (but in no event later than one Business Day) following the Offer Closing or such other date and time as may be mutually agreed in writing by the parties hereto, or (ii) in the event that Approval is Required, no later than the third Business Day after satisfaction or (to the extent permitted by applicable Law and this Agreement) waiver of the conditions set forth in ARTICLE VI (other than those conditions that by their terms are to be satisfied at the Closing, but subject to the satisfaction or (to the extent permitted by applicable Law and this Agreement) waiver of those conditions). The Closing will take place at the offices of Kilpatrick Townsend & Stockton LLP, 1100 Peachtree Street NE, Suite 2800, Atlanta, Georgia 30309-4528. The date on which the Closing occurs is referred to in this Agreement as the “Closing Date.” “Approval is Required” if either (i) the Offer Termination occurs or (ii) after the Offer Closing (including after giving effect to any exercise of the Top-Up Option), Purchaser does not own at least 90% of the outstanding shares of Common Stock.

Section 1.07.      Effective Time.  On the Closing Date, the Company shall (a) file a certificate of merger (the “Certificate of Merger”) with the Secretary of State of the State of Georgia in such form as is required by, and executed in accordance with, the relevant provisions of the GBCC, and (b) make all other filings or recordings required by the GBCC to effectuate the Merger. The Merger shall become effective at such time as the Certificate of Merger is duly filed with, and accepted by, the Secretary of State of the State of Georgia or at such subsequent date and time as the Company and Purchaser shall agree and specify in the Certificate of Merger (the date and time that the Merger becomes effective is referred to as the “Effective Time”).

Section 1.08.      Effects of the Merger.  Not later than the date that the Certificate of Merger is filed with the Secretary of State of the State of Georgia, Parent shall cause the publication required by Section 14-2-1105.1 of the GBCC to be made. Without limiting the generality of the foregoing, and subject thereto, from and after the Effective Time, all property, rights, privileges, immunities, powers, franchises, licenses and authority of the Company and Purchaser shall vest in the Surviving Corporation, and all debts, liabilities, obligations, restrictions and duties of each of the Company and Purchaser shall become the debts, liabilities, obligations, restrictions and duties of the Surviving Corporation.

Section 1.09.       Articles of Incorporation and Bylaws.

(a)          At the Effective Time, the articles or certificate of incorporation of Purchaser, as in effect immediately prior to the Effective Time, shall be the articles of certificate of incorporation of the Surviving Corporation until thereafter changed or amended as provided therein or by applicable Law; provided, however, that Article I thereof shall read as follows: “The name of the Corporation is Innotrac Corporation.”

(b)          At the Effective Time, the bylaws of Purchaser, as in effect immediately prior to the Effective Time, shall be the bylaws of the Surviving Corporation until thereafter changed or amended as provided therein or by applicable Law.

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Section 1.10.       Officers and Directors.  As of the Effective Time, the Persons listed on Annex I hereto shall be the officers of the Surviving Corporation, until the earlier of their death, resignation or removal or until their respective successors are duly elected and qualified in accordance with applicable Law, as the case may be. As of the Effective Time, the directors of Purchaser immediately prior to the Effective Time shall be the directors of the Surviving Corporation, until the earlier of their death, resignation or removal or until their respective successors are duly elected and qualified in accordance with applicable Law, as the case may be.

ARTICLE II.
EFFECT OF MERGER ON CAPITAL STOCK OF CONSTITUENT CORPORATIONS; COMPANY STOCK OPTIONS; EXCHANGE OF CERTIFICATES

Section 2.01.       Effect on Capital Stock.  At the Effective Time, by virtue of the Merger and without any action on the part of Purchaser, the Company or the holders of any shares of Common Stock or any shares of common stock, par value $0.10 per share, of Purchaser (the “Purchaser Common Stock”):

(a)          (i) each share of Common Stock held by the Company as treasury stock or that is issued or outstanding and owned directly or indirectly by Parent or Purchaser immediately prior to the Effective Time (including as a result of the exercise of the Top-Up Option by Purchaser) shall be automatically cancelled and retired and shall cease to exist, and no cash, stock or other consideration shall be delivered or deliverable in exchange therefor;

(ii)         any shares of Common Stock owned by any direct or indirect wholly-owned Subsidiary of the Company shall not represent the right to receive any consideration and shall be automatically cancelled and retired and shall cease to exist, and no cash, stock or other consideration shall be delivered or deliverable in exchange therefor;

(b)          each share of Purchaser Common Stock that is issued and outstanding immediately prior to the Effective Time shall be converted into and become one (1) validly issued, fully paid and nonassessable share of common stock, par value $0.10 per share, of the Surviving Corporation; and

(c)          each share of Common Stock (including each share of Restricted Stock) that is issued and outstanding immediately prior to the Effective Time, other than Excluded Shares, shall automatically be converted into the right to receive an amount in cash equal to the Offer Price, without interest, subject to any withholding of taxes required by applicable Law (the “Common Merger Consideration”) and all such shares of Common Stock shall cease to be outstanding and shall be automatically cancelled and retired and shall cease to exist, and each holder of a certificate (a “Common Stock Certificate”) or book-entry shares (“Book-Entry Shares”) that, immediately prior to the Effective Time, represented any shares of Common Stock shall thereafter cease to have any rights with respect to such shares of Common Stock, except, in all cases, the right to receive (other than with respect to the Excluded Shares) the Common Merger Consideration, without interest, to be paid in consideration therefore upon surrender of such Common Stock Certificate in accordance with Section 2.05.

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Section 2.02.        Dissenting Shares.  Notwithstanding anything in this Agreement to the contrary, shares of Common Stock issued and outstanding immediately prior to the Effective Time that are held by any shareholder who is entitled to demand and properly demands appraisal of such shares pursuant to, and who complies in all respects with, the provisions of Section 14-2-1302 et seq. of the GBCC shall not be converted into the right to receive the Common Merger Consideration as provided in Section 2.01(c), but instead shall entitle such shareholder to the right to receive such consideration as is determined to be due with respect to such Dissenting Shares in accordance with the provisions of Section 14-2-1302 et seq. of the GBCC. At the Effective Time, all Dissenting Shares shall no longer be outstanding, shall automatically be cancelled and shall cease to exist, and each holder of Dissenting Shares shall cease to have any rights with respect thereto, except the right to receive such consideration as is determined to be due with respect to such Dissenting Shares in accordance with the provisions of Section 14-2-1302 et seq. of the GBCC. Notwithstanding the foregoing, if any such shareholder shall fail to perfect or otherwise shall waive, withdraw or lose the right to appraisal under Section 14-2-1302 et seq. of the GBCC, or a court of competent jurisdiction shall determine that such shareholder is not entitled to the relief provided by Section 14-2-1302 et seq. of the GBCC, then the right of such shareholder to receive such consideration as is determined to be due with respect to such Dissenting Shares under Section 14-2-1302 et seq. of the GBCC shall cease and such Dissenting Shares shall be deemed to have been converted at the Effective Time into, and shall have become, the right to receive the Common Merger Consideration. The Company shall (a) serve prompt notice to Parent of any demands for appraisal of any shares of Common Stock, attempted withdrawals of such demands and any other instruments served pursuant to the GBCC and received by the Company relating to shareholders’ rights of appraisal and (b) give Parent the opportunity to control all negotiations and proceedings with respect to such demands for appraisal. Without limiting the generality of the foregoing, prior to the Effective Time the Company shall not, except with the prior written consent of Parent, make any payment or agree to make any payment with respect to any demands for appraisal or offer to settle or settle any such demands.

Section 2.03.        Restricted Stock; Company Stock Options; Withholding.

(a)          Restricted Stock.

(i)          As soon as practicable after the date of this Agreement, the Company shall take, and cause the Board or any committee administering the Stock Option Plans to adopt resolutions approving the taking of, all actions to provide that each share of Common Stock outstanding immediately prior to the Offer Closing (or if Approval is Required, immediately prior to the Effective Time) that is subject to vesting or other lapse restrictions pursuant to the Stock Option Plans or any applicable restricted stock award agreement (collectively, “Restricted Stock”) (A) shall automatically vest and become free of such restrictions immediately following the Offer Closing (or if Approval is Required, immediately prior to the Effective Time), (B) shall cease to be outstanding and shall be automatically cancelled and retired and shall cease to exist, and (C) shall be automatically converted into the right to receive the Common Merger Consideration in accordance with Section 2.01(c); provided, however, that the Common Merger Consideration shall be paid net of any applicable tax withholdings as set forth in Section 2.03(c), which the Surviving Corporation or the Parent, as the case may be, shall promptly pay when due to the appropriate Governmental Entity for the account of each holder of the Restricted Stock.

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(ii)         Promptly following the Effective Time (but in no event later than the fifth Business Day thereafter), Parent shall cause the Surviving Corporation to pay through its payroll systems the aggregate Common Merger Consideration (net of any applicable tax withholdings) with respect to all shares of Restricted Stock to the holders of such shares of Restricted Stock. No interest shall be paid or accrue on such payments.

(b)          Stock Options.

(i)          As soon as practicable after the date of this Agreement and except as set forth on Schedule 2.03(b)(i) of the Company Disclosure Schedule, with respect to each option outstanding immediately prior to the Effective Time, whether or not then exercisable or vested, that represents the right to acquire shares of Common Stock under the Stock Option Plans or otherwise (such options, the “Cash Out Options”), the Company shall take, and cause the Board or any committee administering the Stock Option Plans to adopt resolutions approving the taking of, commercially reasonable efforts (including the amendment of any Stock Option Plan and giving notices and obtaining consents where necessary) to provide that each such Cash Out Option shall, immediately following the Offer Closing (or in the event Approval is Required, as of the Effective Time), (A) automatically become fully vested and exercisable, (B) cease to be outstanding and be automatically cancelled and cease to exist, (C) be automatically converted into the right to receive the Option Cash Amount, if any, and (D) if the exercise price per share of Common Stock issuable under any Cash Out Option is equal to or greater than the Common Merger Consideration, be automatically cancelled and retired and shall cease to exist, and no cash, stock or other consideration shall be delivered or deliverable in exchange therefor. For purposes of this Section 2.03(b), “Option Cash Amount” shall mean the product of (1) the excess, if any, of the Common Merger Consideration over the exercise price per share of the applicable Cash Out Option, and (2) the number of shares subject to the applicable Cash Out Option; provided, however, that the Option Cash Amount shall be paid net of any applicable tax withholdings as set forth in Section 2.03(c), which the Surviving Corporation or the Parent, as the case may be, shall promptly pay when due to the appropriate Governmental Entity for the account of each holder of the Cash Out Option.

(ii)         Promptly following the Effective Time (but in no event later than the fifth Business Day thereafter), Parent shall cause the Surviving Corporation to pay through its payroll systems the aggregate Option Cash Amount (net of any applicable tax withholdings) with respect to all Cash Out Options to the holders of such Cash Out Options. No interest shall be paid or accrue on such payments.

(c)          Withholding.  To the extent the Surviving Corporation or Parent is required to deduct and withhold from the consideration otherwise payable pursuant to this Agreement to any holder of Cash Out Options or any holder of Restricted Stock with respect to the making of such payment under the Internal Revenue Code of 1986, as amended (together with the rules and regulations promulgated thereunder, the “Code”), or any provision of any other tax Law, the amounts so withheld and paid over to the appropriate taxing authority by the Surviving Corporation or Parent shall be treated for all purposes of this Agreement as having been paid to the holder of Cash Out Options or Restricted Stock in respect of which such deduction and withholding was made by the Surviving Corporation.

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Section 2.04.       Certain Adjustments. Notwithstanding any provision of this ARTICLE II to the contrary, if, between the date of this Agreement and the Effective Time, (a) the outstanding shares of Common Stock shall have been increased, decreased, changed into or exchanged for a different number of shares or different class, in each case, by reason of any reclassification, recapitalization, stock split (including reverse stock split), split-up, combination or exchange or readjustment of shares, (b) a stock dividend or dividend payable in any other securities of the Company shall be declared with a record date within such period, or (c) any similar event shall have occurred, then in each case the Common Merger Consideration and the Option Cash Amount shall be appropriately adjusted to provide the holders of shares of Common Stock and Cash Out Options, respectively, the same economic effect as contemplated by this Agreement prior to such event; provided that nothing in this Section 2.04 shall be construed to permit the Company to take any action with respect to its securities that is prohibited by the terms of this Agreement, nor shall Parent or Purchaser be deemed to have consented to any action requiring consent of Parent or Purchaser hereunder by virtue of this Section 2.04.

Section 2.05.        Exchange of Common Stock Certificates and Book-Entry Shares; Paying Agent.

(a)          Paying Agent.  Prior to the Closing Date, Parent shall designate, and enter into an agreement with, a bank or trust company reasonably acceptable to the Company to act as paying agent for the aggregate Common Merger Consideration payable to holders of Common Stock as a result of the Merger upon surrender of Common Stock Certificates or Book-Entry Shares, as applicable (the “Paying Agent”). Immediately prior to the filing of the Certificate of Merger with the Secretary of State of the State of Georgia, Parent will deposit, or cause to be deposited, with the Paying Agent, for the benefit of the holders of shares of Common Stock that have been converted into the right to receive the Common Merger Consideration pursuant to Section 2.01(c), cash sufficient to effect the payment of the aggregate Common Merger Consideration to which such holders are entitled pursuant to Section 2.01(c) upon surrender of Common Stock Certificates or Book-Entry Shares, as applicable. Such aggregate Common Merger Consideration, once deposited with the Paying Agent, shall, pending its disbursement to such holders, be held in trust for the benefit of such shareholders and shall not be used for any other purposes. The Paying Agent shall invest all cash deposited with the Paying Agent as reasonably directed by Parent and all interest and other income resulting from any such investments shall be paid to the Surviving Corporation. Any portion of the aggregate Common Merger Consideration deposited with the Paying Agent to pay for Dissenting Shares shall be returned to Parent upon demand.

(b)          Payment Procedures.  As soon as reasonably practicable after the Effective Time (but no later than the fifth Business Day thereafter), the Surviving Corporation shall cause the Paying Agent to mail to each holder of record of Common Stock as of immediately prior to the Effective Time (i) a letter of transmittal (which shall specify that delivery shall be effected and risk of loss and title to shares of Common Stock shall pass only upon delivery of Common Stock Certificates (or affidavits of loss in lieu thereof which are reasonably acceptable to the Parent and the Company) or Book-Entry Shares to the Paying Agent and shall be in such form and have such other provisions as Parent and the Company reasonably determine), and (ii) instructions for use in effecting the surrender of the Common Stock Certificates and Book-Entry Shares in exchange for payment of the applicable Common Merger Consideration to which the holder thereof is entitled. Upon surrender of the Common Stock Certificates or Book-Entry Shares, as applicable, for cancellation to the Paying Agent, together with such letter of transmittal, duly completed and validly executed in accordance with the instructions thereto, and such other documents as may customarily be required by the Paying Agent, the holder of such Common Stock Certificates or Book-Entry Shares, as applicable, shall be entitled to receive the applicable Common Merger Consideration, without interest, in exchange for each share of Common Stock formerly represented by such Common Stock Certificates or Book-Entry Shares, as applicable, and the Common Stock Certificates or Book-Entry Shares, as applicable, so surrendered shall forthwith be cancelled. Until surrendered as contemplated by this Section 2.05(b), each Common Stock Certificate or Book-Entry Share, as applicable, (other than a Common Stock Certificate or Book-Entry Share, as applicable, representing Excluded Shares) shall be deemed at any time after the Effective Time to represent only the right to receive upon such surrender the Common Merger Consideration, without interest, into which the shares of Common Stock theretofore represented by such Common Stock Certificates or Book-Entry Shares, as applicable, are convertible into pursuant to Section 2.01(c).

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(c)          No Further Ownership Rights in Common Stock; Transfer Books.  All consideration paid upon the surrender of Common Stock Certificates or Book-Entry Shares, as applicable, in accordance with the terms of this ARTICLE II shall be deemed to have been paid in full satisfaction of all rights pertaining to the shares of Common Stock theretofore represented by such Common Stock Certificates or Book-Entry Shares, as applicable, and, at the Effective Time, the stock transfer books of the Company shall be closed and there shall be no further registration of transfers on the stock transfer books of the Surviving Corporation of the shares of Common Stock which were outstanding immediately prior to the Effective Time. From and after the Effective Time, the holders of Common Stock Certificates or Book-Entry Shares, as applicable, that evidenced ownership of either shares of Common Stock outstanding immediately prior to the Effective Time shall cease to have any rights with respect to such shares of Common Stock except as otherwise provided for herein or by applicable Law. If, after the Effective Time, Common Stock Certificates or Book-Entry Shares, as applicable, are presented to the Surviving Corporation, Parent or the Paying Agent for any reason, they shall be cancelled and exchanged as provided in this ARTICLE II, except as otherwise provided by applicable Law.

(d)          Undistributed Common Merger Consideration.  Any portion of the funds made available to the Paying Agent pursuant to Section 2.05(a) that remains undistributed to holders of Common Stock Certificates or Book-Entry Shares, as applicable, on the date that is one (1) year after the Effective Time shall be delivered to the Surviving Corporation or its designee, and any holder of Common Stock Certificates or Book-Entry Shares, as applicable, who has not theretofore complied with this ARTICLE II shall thereafter look only to the Surviving Corporation (subject to abandoned property, escheat or other similar Laws) and only as a general creditor thereof with respect to the payment of any Common Merger Consideration to which such holder is entitled pursuant to this ARTICLE II upon surrender of Common Stock Certificates or Book-Entry Shares, as applicable. Any portion of the funds made available to the Paying Agent pursuant to Section 2.05(a) that remains unclaimed by holders of Common Stock Certificates or Book-Entry Shares, as applicable, on the date that is immediately prior to such time as such amounts would otherwise escheat to or become property of any Governmental Entity shall, to the extent permitted by Law, become the property of the Surviving Corporation, free and clear of all claims or interests of any Person previously entitled thereto.

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(e)          No Liability.  None of Parent, Purchaser, the Company, the Surviving Corporation, the Paying Agent or their respective representatives shall be liable to any Person in respect of any Common Merger Consideration delivered to a public official pursuant to any applicable abandoned property, escheat or similar Law.

(f)          Lost, Stolen or Destroyed Common Stock Certificates.  If any Common Stock Certificate shall have been lost, stolen or destroyed, then, upon the making of an affidavit of that fact by the Person claiming such Common Stock Certificate to be lost, stolen or destroyed and, if required by the Surviving Corporation, the posting of a bond in customary form in favor of the Surviving Corporation, in such reasonable amount as Surviving Corporation may direct, as an unsecured indemnity against any claim that may be made against it with respect to such Common Stock Certificate, the Paying Agent shall deliver in exchange for such lost, stolen or destroyed Common Stock Certificate the Common Merger Consideration payable pursuant to this Agreement in respect of the shares of Common Stock formerly represented by such Common Stock Certificate, as contemplated by this ARTICLE II.

(g)          Withholding Rights.  The Surviving Corporation and Parent shall be entitled, and shall be entitled to direct the Paying Agent, to deduct and withhold from the consideration otherwise payable pursuant to this Agreement to any Person such amounts as Parent, the Surviving Corporation or the Paying Agent is required to deduct and withhold with respect to the making of such payment under the Code, or any provision of any other state, local or foreign tax Law. To the extent that amounts are so deducted and withheld by the Surviving Corporation, Parent or the Paying Agent, such withheld amounts shall be treated for all purposes of this Agreement as having been paid to the Person in respect of which such deduction and withholding was made by the Surviving Corporation, Parent or the Paying Agent, and shall be paid, by the Surviving Corporation, Parent or Paying Agent, as applicable, to the appropriate Governmental Entity.

ARTICLE III.
REPRESENTATIONS AND WARRANTIES

Section 3.01.        Representations and Warranties of the Company. Except (a) as disclosed in the disclosure schedule delivered on the date hereof to Parent and Purchaser which is attached to this Agreement (the “Company Disclosure Schedule”) or (b) as set forth in the Company SEC Documents filed with or furnished to the SEC prior to the third Business Day immediately preceding the date of this Agreement (other than any disclosures in such documents referred to in the “Risk Factors” (other than the second paragraph of the last “Risk Factor” appearing in the Company’s Annual Report on Form 10-K for the year ended December 31, 2012) or “Forward Looking Statements” sections thereof or any other disclosures in such documents which are forward looking or predictive in nature) (provided that nothing disclosed in the Company SEC Documents shall be deemed to be a qualification of or modification to the representations or warranties set forth in Sections 3.01(a), (b), (c), and (q)), in each case, to the extent the applicability of the disclosure to such representation and warranty is reasonably apparent from the text of the disclosure made, the Company represents and warrants to Parent and Purchaser as follows:

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(a)          Organization, Standing and Corporate Power. Each of the Company and each Company Subsidiary is duly organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation or formation, as the case may be, and has all requisite corporate or similar power and authority required to own, lease and operate its properties and to carry on its business as presently conducted. The Company and each Company Subsidiary is duly qualified or licensed to do business and is in good standing in each jurisdiction in which the nature of its business or the ownership, leasing or operation of its properties makes such qualification or licensing necessary, other than in such jurisdictions where the failure to be so qualified or licensed has not had and would not reasonably be expected to have a Material Adverse Effect. The copies of the Organizational Documents of the Company and each Company Subsidiary provided to Parent prior to the date hereof are complete and correct and are in full force and effect. Neither the Company nor any Company Subsidiary is in violation of its Organizational Documents.

(b)          Capital Structure; Subsidiaries.

(i)          The authorized capital stock of the Company consists of 50,000,000 shares of Common Stock and 10,000,000 shares of preferred stock, par value $0.10  per share (“Preferred Stock”). As of the date hereof:

(A)         13,245,440 shares of Common Stock, including 910,637 shares of Restricted Stock, are issued and outstanding, and no shares of Preferred Stock;

(B)         zero shares of Common Stock are held by the Company in its treasury; and

(C)         340,000 shares of Common Stock were authorized and reserved for issuance upon exercise of outstanding options representing the right to acquire shares of Common Stock (the “Stock Options”) awarded pursuant to, or subject to the terms of, the 1997 Stock Option and Incentive Award Plan (the “1997 Stock Option Plan”), the 2000 Stock Option and Incentive Award Plan (the “2000 Stock Option Plan”) and the 2010 Stock Option Plan (the “2010 Stock Option Plan,” and collectively, the “Stock Option Plans”), 340,000 of which are vested.

(ii)         Section 3.01(b)(ii) of the Company Disclosure Schedule sets forth a correct and complete list of each Company Subsidiary together with the jurisdiction of incorporation or formation, as the case may be. Except as set forth in Section 3.01(b)(ii) of the Company Disclosure Schedule, other than the Company Subsidiaries, the Company does not own, directly or indirectly, any capital stock, voting securities or other equity interests in any Person in excess of two percent (2%) of the total outstanding capital stock, voting securities or other equity interests of such Person.

(iii)        All issued and outstanding shares of capital stock of the Company (A) are duly authorized, validly issued, fully paid and nonassessable, (B) were issued free and clear of all Liens, and (C) are not subject to and were not issued in violation of any preemptive or similar right, purchase option, call or right of first refusal or similar right. Each share of capital stock of each Company Subsidiary is owned, directly or indirectly, by the Company or another Company Subsidiary, except as set forth in Section 3.01(b)(iii) of the Company Disclosure Schedule. No Company Subsidiary owns any shares of capital stock of the Company. All issued and outstanding shares of capital stock of each Company Subsidiary owned by the Company (A) are duly authorized, validly issued, fully paid and nonassessable, (B) were issued free and clear of all Liens, and (C) are not subject to and were not issued in violation of any preemptive or similar right, purchase option, call or right of first refusal or similar right.

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(iv)        There are no bonds, debentures, notes or other indebtedness of the Company or any Company Subsidiary having, or providing the holders thereof, the right to vote (or which are convertible into, exchangeable for or exercisable for, shares of capital stock, equity or other securities having the right to vote) on any matters on which shareholders of the Company or any holders of voting securities of any Company Subsidiary may vote. There are no agreements or understandings to which the Company or any Company Subsidiary is a party with respect to the issuance of or the voting interest in any shares of capital stock or any other voting securities or equity interests of the Company or any Company Subsidiary or which restrict the transfer of any such shares or other equity interests (other than agreements restricting the transfer of unvested shares of Restricted Stock issued and outstanding under the Stock Option Plans) or to designate or nominate for election a director to the Board or the board of directors (or other governing body) of any Company Subsidiary.

(v)         Other than pursuant to the Stock Option Plans and except for the Common Stock, there are not issued, reserved for issuance or outstanding (A) any shares of capital stock or other voting securities or equity interests of the Company or any Company Subsidiary, (B) any securities of the Company or any Company Subsidiary convertible into or exchangeable or exercisable for shares of capital stock or other voting securities or equity interests of the Company or any of its Subsidiaries, or (C) any warrants, calls, options, subscriptions, stock appreciation rights, phantom stock, convertible securities or other rights to acquire from the Company or any Company Subsidiary, and no obligation, agreement or commitment of the Company or any Company Subsidiary to issue, transfer or sell any shares of capital stock, voting securities, equity interests or securities convertible into or exchangeable or exercisable for shares of capital stock or voting securities of the Company or any Company Subsidiary, and there are not any outstanding obligations of the Company or any Company Subsidiary to (I) repurchase, redeem or otherwise acquire any such securities or to issue, deliver or sell, or cause to be issued, delivered or sold, any such securities, including any agreements granting or extending any preemptive rights, subscription rights, anti-dilutive rights, rights of first refusal or similar rights with respect to any securities of the Company or any Company Subsidiary or (II) make any investment (in the form of a loan, capital contribution or otherwise) in any Person. There are no agreements or understandings to which the Company or any Company Subsidiary is a party providing for registration rights with respect to, the capital stock or other voting securities or equity interests of the Company or, in the case of any Company Subsidiary, the capital stock owned by the Company.

(vi)        Section 3.01(b)(vi) of the Company Disclosure Schedule sets forth a true, complete and correct list of the Stock Options, including the grant date thereof, the vesting terms thereof, the name of the Persons to whom such Stock Options have been granted, the number of shares subject to each Stock Option, the per share exercise price for each Stock Option and the portion of each Stock Option that is currently exercisable. Each grant of a Stock Option was duly authorized no later than the date on which the grant of such Stock Option was by its terms to be effective by all necessary corporate action. The per share exercise price for each Stock Option was equal to or greater than the fair market value of a share of Common Stock on the applicable grant date. There is no and has been no Company policy or intentional practice to grant, Stock Options prior to, or otherwise intentionally coordinate the grant of Stock Options with, the release of material information regarding the Company. The Company has provided to Parent correct and complete copies of each Stock Options Plans (including all amendments thereto).

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(vii)       Section 3.01(b)(vii) of the Company Disclosure Schedule sets forth a true, complete and correct list of each share of Restricted Stock outstanding under the Stock Option Plans, including the grant date thereof, the vesting terms thereof, the name of the Persons to whom such Restricted Stock awards have been granted and the number of shares granted. There is no and has been no Company policy or intentional practice to grant, Restricted Stock prior to, or otherwise intentionally coordinate the grant of Restricted Stock with, the release of material information regarding the Company. Neither the Company nor any Company Subsidiary has issued any “phantom” stock or stock appreciation rights.

(viii)      None of the Company or any Company Subsidiary is party to any “poison pill”, anti-takeover plan or other similar agreement or understanding relating to any shares of capital stock, voting securities or other equity interests of the Company or any Company Subsidiary.

(ix)         All outstanding shares of capital stock of the Company that have been issued since December 31, 2010 were issued in compliance with all applicable securities Laws.

(c)          Authority; Noncontravention.

(i)          The Company has all requisite corporate power and authority to execute and deliver this Agreement, to perform its obligations hereunder and, subject to the satisfaction of the Minimum Condition (or in the event that Approval is Required, subject to obtaining Shareholder Approval) to consummate the Transaction. The execution, delivery and performance of this Agreement by the Company and the consummation by the Company of the Transaction, has been duly and validly authorized and approved by the Board and, and, other than obtaining Shareholder Approval in the event Approval is Required, and other than filing of the Certificate of Merger with the Secretary of State of the State of Georgia, no other corporate proceedings on the part of the Company are necessary to authorize the execution and delivery of this Agreement or to consummate the Transaction. This Agreement has been duly executed and delivered by the Company and, assuming the due authorization, execution and delivery by Parent and Purchaser, constitutes a legal, valid and binding obligation of the Company, enforceable against the Company in accordance with its terms, subject to bankruptcy, insolvency, moratorium, reorganization or similar laws affecting the rights of creditors generally and the availability of equitable remedies (the “Bankruptcy and Equity Exceptions”). The Board, at a meeting duly called and held and acting upon the unanimous recommendation of the Committee, has unanimously (other than Scott D. Dorfman, who recused himself) (A) determined that it is in the best interests of the Company and its shareholders, and declared it advisable to enter into this Agreement, (B) approved the execution, delivery and performance by the Company of this Agreement and the Transaction, (C) resolved, subject to Section 4.02(g), to recommend that the shareholders of the Company accept the Offer and tender their shares of Common Stock to Purchaser in the Offer, (D) resolved to recommend,in the event Approval is Required, that the shareholders of the Company adopt this Agreement and approve the Merger, and (E) directed, in the event Approval is Required, that this Agreement be submitted to the holders of Common Stock for their adoption (the “Company Recommendation”).

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(ii)         The execution, delivery and performance of this Agreement by the Company does not, and the consummation by the Company of the Transaction, and compliance by the Company with the provisions of this Agreement will not, conflict with, or result in any violation or breach by the Company of, or constitute a default under, or give rise to a right of, or result in, termination, cancellation or acceleration of any obligation or to the loss of a benefit under, or result in the creation of any pledges, liens, charges, claims, options, mortgages, restrictions on transfer, encumbrances or security interests of any kind or nature whatsoever (collectively, “Liens”) in or upon any of the properties or other assets of the Company or any Company Subsidiary under, (A) the Organizational Documents of the Company or any Company Subsidiary, (B) except as set forth on Section 3.01(c)(ii) of the Company Disclosure Schedule, any material loan or credit agreement, bond, debenture, note, mortgage, indenture, lease or other contract, agreement, obligation, commitment, arrangement, understanding, instrument, permit, franchise or license (each, including all amendments thereto, a “Contract”) to which the Company or any Company Subsidiary is a party or any of their respective properties or other assets may be bound (with or without notice, lapse of time or both), or (C) subject to (1) the satisfaction of the Minimum Condition (or obtaining the Shareholder Approval in the event Approval is Required) and (2) the governmental filings and the other matters referred to in Section 3.01(d) below, any (x) Law applicable to the Company or any Company Subsidiary or their respective properties or other assets or (y) order, writ, injunction, decree, statute, rule, regulation, judgment or stipulation (an “Order”), in each case applicable to the Company or any Company Subsidiary or their respective properties or other assets, other than, in the case of clauses (B) and (C), any such conflicts, violations, breaches, defaults, rights, losses or Liens that would not reasonably be expected to have a Material Adverse Effect.

(d)          Governmental And Other Approvals.  No consent, approval, Order or authorization of, action by or in respect of, or registration, declaration or filing with, or notice to, any Federal, state, local or foreign government, any court, administrative, regulatory or other governmental agency, tribunal, commission, authority or accrediting body or any non-governmental self-regulatory agency, commission, authority or accrediting body (whether or not private or quasi-private) including any taxing authority (each, a “Governmental Entity”) is required by or with respect to the Company or any Company Subsidiary in connection with the execution, delivery and performance of this Agreement by the Company or the consummation of the Transaction, except for (i) the filing of a pre-merger notification and report form by the Company under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (including the rules and regulations promulgated thereunder, the “HSR Act”), and the receipt, termination or expiration, as applicable, of approvals or waiting periods required under the HSR Act or any other applicable competition, merger control, antitrust or similar law or regulation, (ii) the filing with the Securities and Exchange Commission (the “SEC”) of (A) the Schedule 14D-9, (B) the Schedule 13E-3, (C) in the event Approval is Required, a proxy statement relating to the adoption by the shareholders of the Company of this Agreement (as amended or supplemented from time to time, the “Proxy Statement”), and (D) such reports under the Securities Exchange Act of 1934, as amended (including the rules and regulations promulgated thereunder, the “Exchange Act”), the Securities Act (as defined below) and state securities or state “blue sky” laws as may be required in connection with this Agreement and the Transaction, (iii) the GBCC with respect to the filing of the Certificate of Merger with the Secretary of State of the State of Georgia, (iv) any filings required under the rules and regulations of Nasdaq and (v) such other consents, approvals, orders authorizations, actions, registrations, declarations and filings, the failure of which to be obtained or made would not reasonably be expected to have a Material Adverse Effect.

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(e)          Company SEC Documents.

(i)          Except as set forth in Section 3.01(c) of the Company Disclosure Schedule, the Company has filed with or furnished to the SEC, on a timely basis, all forms, reports, statements, certifications and other documents required to be filed by it with the SEC since December 31, 2010 (collectively, and in each case including all exhibits and schedules thereto and documents incorporated by reference therein, the “Company SEC Documents”). As of their respective effective dates (in the case of Company SEC Documents that are registration statements filed pursuant to the requirements of the Securities Act of 1933, as amended (including the rules and regulations promulgated thereunder, the “Securities Act”)) and as of their respective SEC filing dates (in the case of all other Company SEC Documents), the Company SEC Documents complied, and the Company will use reasonable efforts consistent with past practices to ensure that all Company SEC Documents filed with or furnished to the SEC subsequent to the date of this Agreement will comply, in all material respects with the requirements of the Securities Act, the Exchange Act and the Sarbanes-Oxley Act, as the case may be, and the rules and regulations of the SEC thereunder, applicable to such Company SEC Documents, and none of the Company SEC Documents as of such respective dates (or, if amended prior to the date of this Agreement, the date of the filing of such amendment, with respect to the disclosures that are amended) contained, and the Company will use reasonable efforts consistent with past practices to ensure that none of the Company SEC Documents filed with or furnished to the SEC subsequent to the date of this Agreement will contain, any untrue statement of a material fact or omitted to state a material fact required to be stated therein to make the statements therein, in light of the circumstances under which they were made, not misleading. Except as set forth on Schedule 3.01(e) of the Company Disclosure Schedule, the Company is, and since December 31, 2010, has been, in compliance in all material respects with the applicable listing and corporate governance rules and regulations of Nasdaq. No Company Subsidiary is separately subject to the reporting requirements of the Exchange Act or is required to file any form, report or other documents with the SEC, Nasdaq or, to the Company’s Knowledge, any other stock exchange.

(ii)         Each of the audited consolidated financial statements and unaudited consolidated financial statements of the Company included or incorporated by reference in the Company SEC Documents (including the related notes and schedules), as of their respective effective dates (in the case of Company SEC Documents that are registration statements filed pursuant to the requirements of the Securities Act) and as of their respective SEC filing dates (in the case of all other Company SEC Documents), complied or, if not yet filed or furnished, the Company will use reasonable efforts consistent with past practices to ensure that such statements will comply, as to form in all material respects with all applicable published rules and regulations of the SEC with respect thereto (except, in the case of unaudited statements, as permitted by Form 10-Q and Regulation S-X of the SEC), were or, if not yet filed or furnished, will be, prepared in accordance with generally accepted accounting principles in the United States consistently applied (“GAAP”) and applicable published rules and regulations of the SEC consistently applied during the periods involved (except (A) with respect to financial statements included in Company SEC Documents filed as of the date of this Agreement, as may be indicated in the notes thereto, or (B) as permitted by the rules and regulations of the SEC, including Regulation S-X), and fairly present in all material respects in accordance with GAAP the consolidated financial position of the Company and its consolidated Subsidiaries as of the dates thereof and the consolidated statements of operations, changes in shareholders’ equity and cash flows of such companies as of the dates and for the periods shown therein. As of the date of this Agreement, there are no outstanding or unresolved comments in comment letters received from the SEC or its staff.

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(iii)        Neither the Company nor any Company Subsidiary has any material liabilities or obligations of any nature (whether accrued, absolute, contingent or otherwise and whether due or to become due) and there is no existing condition, situation or set of circumstances that would be required to be reflected or reserved against on a consolidated balance sheet of the Company prepared in accordance with GAAP or the notes thereto, except liabilities or obligations (A) reflected or reserved against on the consolidated balance sheet, including the notes thereto (the “Balance Sheet”) of the Company as of September 30, 2013 (the “Balance Sheet Date”) included in the Company SEC Documents, (B) incurred after the Balance Sheet Date in the ordinary course of business consistent with past practice or (C) as specifically contemplated by this Agreement or otherwise in connection with the Transaction. There are no unconsolidated Subsidiaries of the Company or any off-balance sheet arrangements of any type (including any off-balance sheet arrangement required to be disclosed pursuant to Item 303(a)(4) of Regulation S-K).

(iv)        The Company has established and maintains disclosure controls and procedures reporting (as defined in Rule 13a-15(e) promulgated under the Exchange Act) and internal control over financial reporting (as defined in Rule 13a-15(f) promulgated under the Exchange Act). Such disclosure controls and procedures are designed to provide reasonable assurance that material information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the Company’s management, including its principal executive and principal financial officers, as appropriate to allow timely decisions regarding required disclosure. The Company’s internal control over financial reporting is designed to provide reasonable assurance that the objectives of internal control over financial reporting as set forth in Rule 13a-15(f) are met. The Company has evaluated its disclosure controls and procedures and internal control over financial reporting at the times and as required by the Exchange Act, and the Company determined that its disclosure controls and procedures and internal control over financial reporting were effective to provide reasonable assurance that the respective objectives of disclosure controls and procedures and internal control over financial reporting were met as of the dates of such evaluations. The Company has disclosed to the Company’s outside auditors and the audit committee of the Board (A) all significant deficiencies in the design or operation of internal controls over financial reporting and any material weaknesses, in each case, of which the Company has or had Knowledge and (B) any allegation of fraud of which the Company has or had Knowledge that involves the Company’s management or other employees who have a significant role in the preparation of financial statements or the internal control over financial reporting utilized by the Company and the Company Subsidiaries.

(v)         Since December 31, 2010, neither the Company nor any Company Subsidiary nor any officer or director of the Company or any Company Subsidiary has received any written complaint or allegation of fraud and, to the Company’s Knowledge, there is no, and since December 31, 2010, there has not been any, fraud, in either case, that involves the Company’s management or other employees who have a significant role in the preparation of financial statements or the internal control over financial reporting utilized by the Company and the Company Subsidiaries.

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(f)          Absence of Changes.  Since December 31, 2012, except for this Agreement and the Transaction, (i) the Company and the Company Subsidiaries have conducted their respective businesses in the ordinary course of business, and (ii) there has not been any Material Adverse Change or any fact, circumstance, event, change or occurrence that has had or would reasonably be expected to result in a Material Adverse Change. In addition, without limiting the generality of the foregoing, except as set forth on Section 3.01(f) of the Company Disclosure Schedule, since December 31, 2012, neither the Company nor any Company Subsidiary has taken or authorized any action which, if taken or authorized on or after the date of this Agreement, would require the consent of Parent pursuant to Sections 4.01(a), (c), (f), (h), (m), (n), (p) or (r).

(g)          Litigation.  Except as set forth in Section 3.01(g) of the Company Disclosure Schedule, there is no Proceeding pending, or, to the Company’s Knowledge, threatened, against the Company or any Company Subsidiary or any of the Company’s businesses, properties or assets or any current or, to the Company’s Knowledge former, officer or director of the Company or any Company Subsidiary (in his or her capacity as an officer or director). Neither the Company nor, to the Company’s Knowledge, any Company Subsidiary (or any of their respective businesses, properties or assets) is subject to any material outstanding Order by or before any Governmental Entity.

(h)          Contracts.  Except as set forth in Section 3.01(h) of the Company Disclosure Schedule or as filed or furnished with the Company SEC Documents, as of the date of this Agreement, neither the Company nor any Company Subsidiary is a party to or bound by, and none of their respective properties or other assets is subject to (whether written or oral):

(i)          any Contract containing covenants limiting in any material respect the freedom of the Company or any Company Subsidiary to compete in any line of business or with any other Person;

(ii)         any joint venture, partnership, manufacturer, development or supply agreement or other Contract which involves a sharing of revenue, profits, losses, costs or liabilities by the Company or any Company Subsidiary with any other Person;

(iii)        any royalty, dividend or similar arrangement to be paid, or received, by the Company that is based on the revenue or profits of the Company or any Company Subsidiary or any Contract or agreement involving fixed price or fixed volume arrangements;

(iv)        any Contract (or series of related Contracts) for the purchase or sale of materials, supplies, goods, services, equipment or other assets providing for annual payments by the Company and its Subsidiaries or to the Company and the Company Subsidiaries, respectively, of $75,000 or more, other than those that can be terminated by the Company or any Company Subsidiary on less than 90 days’ notice without payment by the Company or any Company Subsidiary of any penalty;

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(v)         any loan or guaranty agreement, note, indenture or other instrument, Contract, or agreement under which the Company or any Company Subsidiary has incurred or guaranteed any Indebtedness, other than obligations for the deferred purchase price of property, goods or services not in excess of $5,000 individually or $25,000 in the aggregate;

(vi)        any employment, change of control or severance Contract with any employee (other than those that are terminable by the Company or any Company Subsidiary without cost or penalty upon 90 or fewer days’ notice);

(vii)       any Company Benefit Plan (as defined below);

(viii)      any Contract relating to (A) any acquisition of securities or assets of another Person or another business by the Company or any Company Subsidiary pursuant to which the Company or any Company Subsidiary has continuing “earn-out” or other payment or guarantee obligations in excess of $100,000; or (B) any obligation of the Company or any Company Subsidiary to make a loan or capital contribution to or investment in any Person;

(ix)         any Company Lease with annual rent in excess of $50,000;

(x)          any Contract (other than pursuant to insurance-related documents) providing for indemnification by the Company or any Company Subsidiary of any officer, director or employee of the Company or any Company Subsidiary;

(xi)         any Contract that prohibits the payment of dividends or distributions in respect of the capital stock of the Company or any Company Subsidiary, prohibits the pledging of the capital stock of the Company or any Company Subsidiary, or prohibits the issuance of guarantees by any of the Company’s Subsidiaries;

(xii)        any Contract that contains a put, call or similar right pursuant to which the Company or any Company Subsidiary could be required to purchase or sell, as applicable, any equity interests of any Person or assets;

(xiii)       any mortgage, security agreement, capital lease or other agreement that effectively creates a Lien on any material assets of the Company or any Company Subsidiary;

(xiv)      any Contract with any Governmental Entity;

(xv)       any “material contract” (as such term is defined in Item 601(b)(10) of Regulation S-K);

(xvi)      any Contract that requires the Company or any Company Subsidiary to make capital expenditures in excess of $250,000;

(xvii)     any Contract relating to interest rate or currency hedging activities;

(xviii)    any Contract that would prohibit or materially delay the consummation of the Transaction or otherwise materially impair the ability of the Company to perform its obligations hereunder ;

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(xix)       any Contract with any sole source vendor, any requirements Contract or any Contract containing fixed pricing, “take or pay” requirements or a “most favored nations” provision; or

(xx)        any Contract not otherwise required to be disclosed pursuant to clauses (i) through (xviii) above that (A) requires payments by or to the Company or any Company Subsidiary in excess of $500,000 during any 12-month period or (B) is material to the Company and the Company Subsidiaries, taken as a whole.

Each Contract described in clauses (i) through (xix) shall be referred to herein as a “Material Contract”. Each Material Contract is in full force and effect and, assuming its enforceability against the counterparties, is enforceable against the Company and/or any Company Subsidiary party to such Material Contract in accordance with its terms. None of the Company, any Company Subsidiary or, to the Company’s Knowledge, any other party thereto is in material violation of or in default under (nor does there exist any condition which upon the passage of time or the giving of notice or both would cause such a violation of or default under) any Material Contract. Neither the Company nor any Company Subsidiary, has received any written or, to the Company’s Knowledge, verbal notice to terminate or materially adversely amend, nor to the Company’s Knowledge, does there exist any condition which upon the passage of time or the giving of notice or both would reasonably be expected to result in the termination of or material adverse amendment to, any Material Contract that has not terminated or expired (in each case according to its terms) prior to the date of this Agreement.

(i)          Compliance with Laws; Permits.

(i)          Except with respect to Environmental Laws, ERISA, and taxes, which are the subjects of Section 3.01(j), Section 3.01(l) and Section 3.01(m), respectively, the Company and, to the Company’s Knowledge, each Company Subsidiary are, and since December 31, 2010, have been, in compliance in all material respects with all Laws applicable to it, its properties or other assets or its business or operations, and neither the Company nor any Company Subsidiary has received any written notice alleging that the Company or any Company Subsidiary is in violation of any Law to which the Company or any Company Subsidiary or any of their respective properties or other assets or its business or operations.

(ii)         Section 3.01(i) of the Company Disclosure Schedule sets forth a correct and complete list of the material Permits issued or granted to the Company or any Company Subsidiary which are necessary in connection with the conduct of the businesses of the Company or such Company Subsidiary (the “Material Permits.”) The Material Permits are all of the material Permits necessary for the conduct of the respective businesses of the Company and the Company Subsidiaries. The Company and the Company Subsidiaries are, and since December 31, 2010, have been, in compliance in all material respects with the terms of all Material Permits and each such Material Permit is validly subsisting, binding and in full force and effect without any default or violation thereunder in any material respect. Neither the Company nor any Company Subsidiary has received any written or, to the Company’s Knowledge, verbal notice regarding any actual or alleged failure to comply with any Material Permit and no Proceeding is pending or, to the Company’s Knowledge, threatened to revoke, suspend, deny, terminate, cancel, withdraw or materially limit any such Material Permits.

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(j)          Environmental Matters.  The Company is in compliance in all material respects with all applicable Environmental Laws, and holds and is in compliance in all material respects with all Permits required under Environmental Laws in connection with the Company’s business. There is no material environmental Proceeding existing or pending, or, to the Company’s Knowledge, threatened, against or affecting the Company or any Company Subsidiary alleging noncompliance with Environmental Laws. Neither the Company nor any Company Subsidiary has received any written or, to the Company’s Knowledge, verbal notice that it is or was in violation of, or has or had any liability, responsibility or obligation under, any Environmental Law, other than notices the allegations of which have been resolved. No Hazardous Material has been transported, stored or released by the Company or any Company Subsidiary at, on, to, or under any real property leased or operated by the Company or any Company Subsidiary during the term of such lease or operation in an amount, manner or concentration that requires any reporting, notification, investigation, abatement, remediation, or other response action under Environmental Laws. The Company has made available to Parent correct and complete copies of all environmental reports, studies, investigations or correspondence in the Company’s possession or control regarding any environmental liabilities of the Company or any Company Subsidiaries. For purposes of this Agreement, “Environmental Laws” means any foreign, federal, state or local Law (including common law) relating to human health and safety or the pollution, protection, or restoration of the Environment, including, without limitation, those relating to the use, handling, presence, transportation, treatment, storage, disposal, release or discharge of Hazardous Materials. “Environment” means soil, sediment, land, surface or subsurface strata, surface water, ground water, ambient air (including indoor air) and any biota living in or on such media.

(k)          Labor Relations.

(i)          There are no collective bargaining or other labor union Contracts to which the Company or any Company Subsidiary is a party or by which the Company or any Company Subsidiary is bound and there are no negotiations or discussions currently pending or occurring between the Company or any Company Subsidiary and any union or employee association regarding any collective bargaining Contract or any other work rules or polices. None of the employees of the Company or any Company Subsidiary is or since December 31, 2010 has been represented by any union with respect to his or her employment by the Company or such Company Subsidiary. To the Company’s Knowledge, there are no organizational efforts with respect to the formation of a collective bargaining unit presently being made or threatened involving employees of the Company or any of the Company Subsidiaries, and there are no lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees.

(ii)         The Company has properly completed a U.S. Citizenship and Immigration Services Form I-9 for each current employee of the Company, and the Company is, and since December 31, 2010, has been, in compliance in all material respects with all applicable Laws governing work authorization.

(iii)        Each current employee of the Company has been properly classified as either exempt or non-exempt under the Fair Labor Standards Act and other similar state Laws.

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(iv)        The Company and each of the Company Subsidiaries has correctly classified those individuals performing services as employees, independent contractors or agents in accordance with applicable Law.

(l)          ERISA Compliance.  Except as set forth in Section 3.01(l) of the Company Disclosure Schedule:

(i)          The Company has made available to Parent complete and accurate copies of (A) each employment, change in control, retention, bonus, pension, profit sharing, deferred compensation, incentive compensation, stock ownership, stock purchase, stock appreciation, restricted stock, stock option, top hat, deferred compensation, “phantom” stock, performance, retirement, thrift, savings, stock bonus, paid time off, perquisite, fringe benefit, vacation, severance, disability, death benefit, hospitalization, medical, welfare benefit or other plan, program, policy, arrangement, agreement or understanding (whether or not legally binding) maintained, contributed to or required to be maintained or contributed to by the Company or any Company Subsidiary or any other Person that, together with the Company, is treated as a single employer under Section 414(b), (c), (m) or (o) of the Code (each, a “Commonly Controlled Entity”), in each case providing benefits to any current or former director, officer, employee or independent contractor of the Company or any Company Subsidiary or any dependent or beneficiary of the foregoing (collectively, the “Company Benefit Plans”), including each Company Benefit Plan that is an “employee pension benefit plan” (as defined in Section 3(2) of ERISA) (sometimes referred to herein as a “Company Pension Plan”) and each Company Benefit Plan that is an “employee welfare benefit plan” (as defined in Section 3(1) of ERISA), (B) the most recent summary plan description for each Company Benefit Plan for which such summary plan description is available, (C) the Form 5500 (and all schedules thereto) for each Company Benefit Plan for the three years preceding the date hereof, if applicable, (D) the determination letter or opinion letter for each Company Pension Plan that is intended to be qualified under Section 401(a) of the Code and (E) each trust agreement and insurance or group annuity contract relating to any Company Benefit Plan. Each Company Benefit Plan has been administered and operated in all material respects in accordance with its terms and the applicable provisions of ERISA, the Code and all other applicable Laws.

(ii)         Each Company Pension Plan intended to be tax-qualified within the meaning of Section 401(a) of the Code has received a favorable determination, or may rely on an opinion letter, from the Internal Revenue Service (the “IRS”) regarding its qualified status, and no event or omission has occurred that is reasonably likely to cause any Company Pension Plan to lose such qualification.

(iii)        Neither the Company nor any Commonly Controlled Entity has (A) maintained, participated in, contributed to, been required to contribute to, or had any liability in respect of any “employee benefit plan” (as defined in Section 3(3) of ERISA) that is subject to Title IV of ERISA (including, any multiemployer plan (as that term is defined in Section 3(37) of ERISA)), any multiple employer plan (as that term is defined in Section 413(c) of the Code), any multiple employer welfare arrangement (as that term is defined in Section 3(40) of ERISA), or any “employee benefit plan” (as defined in Section 3(3) of ERISA) that is subject to Section 412 of the Code or Section 302 of ERISA), or (B) has any unsatisfied liability under Title IV of ERISA.

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(iv)        Neither the Company nor any Company Subsidiary has received notice of, and there are no Proceedings by any Governmental Entity with respect to, termination Proceedings or other Proceedings (except claims for benefits payable in the normal operation of the Company Benefit Plans) against or involving any Company Benefit Plan or asserting any rights or claims to benefits under any Company Benefit Plan.

(v)         Except as set forth on Section 3.01(l)(v) of the Company Disclosure Schedule, neither the execution and delivery of this Agreement, the performance by the Company of its obligations hereunder, nor the consummation of the Transaction, could (either alone or in conjunction with any other event, including the termination of employment of any Person) (i) limit the right of the Company or any Company Subsidiary to amend, merge, terminate or receive a reversion of assets from any Company Benefit Plan or related trust; (ii) result in any “parachute payment” as defined in Section 280G(b)(2) of the Code (whether or not such payment is considered to be reasonable compensation for services rendered); (iii) result in a requirement to pay any tax “gross-up” or similar “make-whole” payments to any employee, director or consultant of the Company or any Company Subsidiary; (iv) accelerate the time of payment or vesting, or materially increase the amount of, compensation due to any employee, director, officer or independent contractor; or (v) otherwise give rise to any material liability under any Company Benefit Plan.

(vi)        Other than individual Contracts with employees that are listed on Section 3.01(l)(vi) of the Company Disclosure Schedule, neither the Company nor any Company Subsidiary is obligated (irrespective of any conditions or lapse of time) pursuant to any Company Benefit Plan or other Contract to make any severance payment to any officer, director, employee or consultant.

(vii)       No Company Benefit Plan provides medical, health, life insurance or other welfare-type benefits to retirees or former employees who terminate (or have terminated) employment with the Company or any Company Subsidiary, or the spouses or dependents of any of the foregoing (except for limited continued medical benefit coverage for former employees, their spouses and other dependents as required to be provided under Section 4980B of the Code or Part 6 of Subtitle B of Title I of ERISA or other similar Laws).

(viii)      All contributions and premium payments (including all employer contributions and employee salary reduction contributions) that are due have been made within the time periods prescribed by ERISA and the Code to each Company Benefit Plan, and all contributions and premium payments for any period ending on or before the Closing Date that are not yet due have been made to each Company Benefit Plan or accrued on the Balance Sheet.

(ix)         Each Company Benefit Plan which is a “non-qualified deferred compensation plan” (as such term is defined in Section 409A(d)(1) of the Code) is in a written form that complies with the requirements of Section 409A of the Code (and the regulations promulgated thereunder) and has been administered in compliance with the requirements of Section 409A of the Code such that it would not reasonably be expected that, in the event of an audit by the Internal Revenue Service, the additional tax described in Section 409A(a)(1)(B) would be assessed against any such participant with respect to benefits due or accruing under such Company Benefit Plan, except for any instances of non-compliance that could be corrected in accordance with guidance issued under Section 409A of the Code without liability to such participant (other than the ordinary income taxes on such amounts that would be payable by such participant regardless of the applicability of Section 409A of the Code).

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(x)          Except as set forth on Section 3.01(l)(x) of the Company Disclosure Schedule, there is no Contract, including this Agreement, covering any employee or former employee of the Company or any Company Subsidiary that, individually or in the aggregate, would give rise to the payment of any amount that would not be deductible pursuant to Sections 404 or 162 of the Code.

(m)         Taxes.

(i)          Each of the Company and the Company Subsidiaries has filed in a timely manner (within any applicable extension period) all tax returns required to be filed by it pursuant to applicable Law. All such tax returns are true, complete and accurate in all material respects and were prepared in compliance in all material respects with applicable Law.

(ii)         The Company and each of the Company Subsidiaries has timely paid all taxes due and owing, except for taxes that are being contested in good faith by appropriate proceedings and for which adequate reserves have been made on the Balance Sheet. The unpaid taxes of the Company and the Company Subsidiaries did not, as of September 30, 2013, exceed the reserve for tax liability set forth on the face of the Balance Sheet (rather than in any notes thereto) and do not exceed such reserve as adjusted for the operations of the Company and the Company Subsidiaries through the Closing Date in accordance with the past custom and practice of the Company and the Company Subsidiaries in filing their tax returns.

(iii)        Neither the Company nor any Company Subsidiary has received notice in writing or, to the Company’s Knowledge, verbal notice of any proposed deficiencies in or dispute or claim concerning any tax return filed by the Company or any Company Subsidiary, which allegations have not been resolved, from any Governmental Entity and there is no currently effective agreement extending the period of assessment or collection of any taxes of the Company or any Company Subsidiary nor has any request been made for any such extension.

(iv)        Within the two-year period ending on the Closing Date, neither the Company nor any of its Subsidiaries has constituted either a “distributing corporation” or a “controlled corporation” as such terms are defined in Section 355 of the Code in a distribution of stock qualifying or intended to qualify for tax-free treatment (in whole or in part) under Section 355(a) or 361 of the Code.

(v)         Neither the Company nor any of its Subsidiaries is a party to or bound by (A) any agreement the principal purpose of which is tax sharing, tax allocation or tax indemnity whether or not written, other than among the Company and its Subsidiaries, or (B) any advance pricing agreement, closing agreement or other agreement relating to taxes with any taxing authority).

(vi)        There are currently no Liens for taxes asserted with respect to any assets or properties of the Company or any Company Subsidiary, except for statutory Liens for taxes not yet due and payable.

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(vii)       The Company and each Company Subsidiary has withheld and remitted to the appropriate Governmental Entity all taxes required to be withheld and paid in connection with any amounts paid or owing to or collected from any employee, independent contractor, supplier, creditor, shareholder or other third party, and all Forms W-2 and 1099 required with respect thereto have been properly completed and timely filed.

(viii)      Neither the Company nor any Company Subsidiary (A) is or has ever been a member of a group of corporations within the meaning of Section 1504(a) of the Code (other than a consolidated group of which the Company is the parent) that files or has filed or has been required to file consolidated, combined, or unitary tax returns or filed taxes on a combined, unitary or similar basis with any entity (other than the Company or its Subsidiaries) for foreign, state or local tax purposes or (B) has any liability for the taxes of any person (other than Company or any of its Subsidiaries) under Treasury Regulations Section 1.1502-6 (or any similar provision of state, local, or foreign law), as a transferee or successor, or by contract or otherwise.

(ix)         No claim has been made by any taxing authority in a jurisdiction where the Company or any Company Subsidiary does not file tax returns that the Company or such Company Subsidiary is or may be subject to taxation by that jurisdiction.

(x)          Except as set forth on Section 3.01(m)(x) of the Company Disclosure Schedule, since December 31, 2010, neither the Company nor any Company Subsidiary has had a permanent establishment in an foreign country, as defined in any applicable tax treaty or convention between the United States and such foreign country.

(xi)         Each asset of the Company or any Company Subsidiary with respect to which the Company or such Company Subsidiary claims depreciation, amortization or similar expense for tax purposes is owned for tax purposes by the Company or such Company Subsidiary.

(xii)        Neither the Company nor any Company Subsidiary will be required to include any item of income in, or exclude any item of deduction from, taxable income for any taxable period (or portion thereof) ending after the Closing Date as a result of any (i) change in method of accounting for a taxable period ending on or prior to the Closing Date, (ii) “closing agreement” as described in Section 7121 of the Code (or any corresponding or similar provision of state, local or foreign law) executed on or prior to the Closing Date, (iii) deferred intercompany gain described in the Treasury Regulations under Section 1502 of the Code (or any corresponding or similar provision of state, local or foreign law), (iv) installment sale or open transaction disposition made on or prior to the Closing Date or (v) prepaid amount received on or prior to the Closing Date.

(xiii)       Neither the Company nor any Company Subsidiary is participating or has participated in, or taken a tax return position relating to, any reportable transaction or listed transaction within the meaning of Treasury Regulations Section 1.6011-4. The Company and each Company Subsidiary has disclosed on its federal income tax returns all positions taken therein that could give rise to a substantial understatement of federal income tax within the meaning of Section 6662 of the Code.

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(xiv)      Neither the Company nor any Company Subsidiary has granted any power of attorney to any Person with respect to any tax matter that is currently in force.

(xv)       Neither the Company nor any Company Subsidiary is, nor has been at any time at any time during the past five years, a “United States real property holding corporation” within the meaning of Section 897(c)(2) of the Code.

(xvi)      Prior to the consummation of the Transaction, neither the Company nor any Company Subsidiary has undergone a change of ownership under Section 382 of the Code and neither the Company nor any Company Subsidiary is subject to any limitation with respect to net operating losses or unrealized losses under Section 382 of the Code.

(xvii)     As used in this Agreement (A) “tax” or “taxes” means any Federal, state, local or foreign income, gross receipts, property, sales, use, registration, value added, excise, escheat, lost or unclaimed property, stamp, windfall profit, occupation, customs duties, withholding, payroll, employment, real estate, social security, disability, capital gain, alternative minimum, add-on minimum, transfer and other taxes and similar governmental charges of any kind, including any interest, penalties and additions with respect thereto, whether or not disputed and including any obligations to indemnify or otherwise assume or succeed to the tax liability of any other Person; (B) “taxing authority” means any Federal, state, local or foreign government, any subdivision, agency, commission or authority thereof, or any quasi-governmental body exercising tax regulatory authority; and (C) “tax return” or “tax returns” means all returns, declarations of estimated tax payments, reports, estimates, information returns and statements, including any related or supporting information with respect to any of foregoing, filed or to be filed with any taxing authority in connection with the determination, assessment, collection or administration of any taxes.

(n)          Properties.

(i)          Section 3.01(n)(i) of the Company Disclosure Schedule contains a complete and correct list of all Leased Real Property. The Company or one or more Company Subsidiaries has a good and valid leasehold interest in each Company Lease, free and clear of all Liens (other than Permitted Liens). Each Company Lease grants the lessee thereunder the right to use and occupy the premises covered thereby. Complete and correct copies of each Company Lease, including all amendments, have been provided by the Company to Parent.

(ii)         The Company’s and each of the Company’s Subsidiaries use of each parcel of Leased Real Property is, and since December 31, 2010, has been, in compliance in all material respects with all applicable Laws, including any building, zoning and land use Laws. Neither the Company nor any Company Subsidiary has received any written or, to the Company’s Knowledge, verbal, notice of any violation of any applicable Laws with respect to the Company or any Subsidiary’s use, occupation or operation of its business at any parcel of Leased Real Property.

(iii)        All buildings located on the Leased Real Property and used by the Company or any Company Subsidiary (including all Company or Company Subsidiary improvements thereon) are in good condition (ordinary wear and tear excepted) and are suitable for the purposes for which they are used by the Company and the Company Subsidiaries.

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(iv)        Neither the Company nor any Company Subsidiary owns any real property.

(v)         The Company or one or more Company Subsidiaries has valid and marketable title to, or a valid leasehold interest in, all items of personal property reflected in the Balance Sheet or acquired after the date thereof, free and clear of all Liens (other than Permitted Liens), except to the extent disposed of in the ordinary course of business since the Balance Sheet Date. All such items of personal property are in operating condition, normal wear and tear excepted. The assets and properties the Company and the Company Subsidiaries own, lease or have a right to use are all of the assets and properties necessary for the Surviving Corporation to operate the businesses of the Company and the Company Subsidiaries immediately after the Closing in the same manner in all material respects as such businesses are currently conducted.

(o)          Intellectual Property. Section 3.01(o) of the Company Disclosure Schedule contains a complete and accurate list of all (i) patents and patent applications owned by the Company or any Company Subsidiary or used or held for use by the Company or any Company Subsidiary (“Company Patents”), registered and material unregistered trademarks and service marks owned by the Company or any Company Subsidiary or used or held for use by the Company or any Company Subsidiary (“Company Marks”), registered copyrights and applications for copyright registration owned by the Company or any Company Subsidiary or used or held for use by the Company or any Company Subsidiary (“Company Copyrights”), trade names and company names owned by the Company or any Company Subsidiary (“Company Trade Names”), domain name registrations owned by the Company or any Company Subsidiary (“Company Domain Names”), and software owned by the Company or any Company Subsidiary and material to the business of the Company or any Company Subsidiary (“Company Software”), and for each such item, specifying the owner thereof, the patent, registration, application or serial number therefor, as applicable, the issuance, registration or application date therefor, as applicable, and the jurisdiction in which such item is filed (as applicable) (all such items, collectively, the “Registered IP”); and (ii) licenses, sublicenses and other agreements under which the Company or any Company Subsidiary is granted rights by others in Company Intellectual Property (other than non-negotiated licenses for commercial off the shelf software for which the aggregate fees are less than $15,000) (“Licenses In”), and (iii) licenses, sublicenses and other agreements under which the Company or any Company Subsidiary has granted rights to others in Company Intellectual Property (“Licenses Out”). In the case of any licenses, sublicenses or other agreements disclosed pursuant to the foregoing clauses (ii) or (iii), Section 3.01(o) of the Company Disclosure Schedule also sets forth whether each such license, sublicense or other agreement is exclusive or non-exclusive. Except as set forth on Section 3.01(o) of the Company Disclosure Schedule:

(i)          The Company and each Company Subsidiary owns the Company Intellectual Property purported to be owned thereby, and the Company and/or one of the Company Subsidiaries owns or has the right to use, pursuant to a valid and enforceable license, all Intellectual Property Rights that are used or held for use in the conduct of the business of the Company and its Company Subsidiaries.

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(ii)         All Registered IP that has been issued by, or registered or is the subject of an application filed with, as applicable, the U.S. Patent and Trademark Office, the U.S. Copyright Office or any similar office or agency anywhere in the world, has been duly maintained (including the payment of maintenance fees), is not expired, cancelled or abandoned and is valid and enforceable.

(iii)        None of the Company Intellectual Property owned by the Company or any Company Subsidiary that has been issued by, or registered or the subject of an application filed with, as applicable, the U.S. Patent and Trademark Office, the U.S. Copyright Office or in any similar office or agency anywhere in the world is subject to any maintenance fees or taxes or actions falling due within 30 days after the Closing Date.

(iv)        To the Company’s Knowledge, neither the operation of the business of the Company or any Company Subsidiary, nor any activity of the Company or any Company Subsidiary, nor the manufacture, use, importation, offer for sale and/or sale of any product or service infringes on or otherwise violates the right of any Person in or to any Intellectual Property Rights (“Third Party IP Rights”), or constitutes a misappropriation of any Third Party IP Rights or the subject matter of any Third Party IP Right, and to the Company’s Knowledge, neither the operation of the business of the Company or any Company Subsidiary, nor any activity of the Company or any Company Subsidiary, nor any manufacture, use, importation, offer for sale and/or sale of any product or service infringes on or otherwise violates the rights of any Person under any patent.

(v)         Except as set forth in Section 3.01(o)(v) of the Company Disclosure Schedule, there are no pending or, to the Company’s Knowledge, threatened, claims (i) that the operation of the business of the Company or any Company Subsidiary or any other activity by the Company or any Company Subsidiary is infringing, misappropriating or otherwise violating any Third Party IP Right or (ii) that any of the Company Intellectual Property is invalid or unenforceable.

(vi)        To the Company’s Knowledge, no Person or Persons are infringing or otherwise violating the rights of the Company or any Company Subsidiary with respect to any Company Intellectual Property. No claims are pending or, to the Company’s Knowledge, are threatened, against the Company or any Company Subsidiary with regard to the ownership by the Company or any Company Subsidiary of any of the Company Intellectual Property.

(vii)       Except as set forth in Section 3.01(o)(vii) of the Company Disclosure Schedule, all material Company Intellectual Property purportedly developed or created by the Company or any Company Subsidiary has been developed or created (i) by employees of the Company or the applicable Company Subsidiary, who developed or created such Company Intellectual Property acting fully within the scope of their employment with the Company or such Company Subsidiary or (ii) by independent contractors engaged by the Company or any Company Subsidiary, each of whom has entered into a written agreement establishing ownership by the Company or a Company Subsidiary, as applicable, of all rights, title and interest of such Person in and to such Intellectual Property.

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(viii)      The Company and each of the Company Subsidiaries has taken commercially reasonable measures to safeguard and maintain the confidentiality and value of the trade secrets and confidential processes, procedures, models, modules, business methods, know-how, data and other confidential information, data and materials owned by or licensed to the Company or any of the Company Subsidiaries or otherwise used or held for use in the operation of their respective businesses (“Company Trade Secrets”).

(ix)         The software, hardware, networks, communications facilities, other technology, and related services used by the Company or any of the Company Subsidiaries (collectively, the “Systems”) are sufficient in all material respects for the operation of their respective businesses as currently conducted. The Company has arranged for disaster recovery and back up services in the event the performance of any of the Systems or any material component thereof is temporarily or permanently impeded or degraded due to any natural disaster or other event outside the reasonable control of the Company that provide for restoration or substitution of the Systems or material component thereof as described in Section 3.01(o)(ix) of the Disclosure Schedules. Since December 31, 2010, no virus, bug, worm, other malicious code or error has caused a material disruption or failure of any of the Systems or of the conduct of the businesses of the Company or any of the Company Subsidiaries. Since December 31, 2010, to the Company’s Knowledge, there has been no unauthorized intrusion or breach of the security of any of the Systems.

(x)          All information relating to any individual Person which can be used to readily identify such Person or otherwise distinguish or trace such Person’s identity has, at all times, been collected, maintained and used by the Company and the Company Subsidiaries in material compliance with the requirements of (i) all applicable Laws, (ii) any and all Contracts to which the Company or any Company Subsidiary is a party and (iii) all applicable privacy and information security policies and other policies of the Company or any Company Subsidiary.

(xi)         As used in this Agreement, “Intellectual Property Rights” shall mean all intellectual property rights arising from or in respect of the following, whether protected, created, or arising under the laws of the United States or any other jurisdiction: (a) inventions (whether patentable or unpatentable and whether or not reduced to practice), improvements thereto, letters patent, patents, patent applications, and all reissues, reexaminations, divisions, patent disclosures, provisionals, continuations, continuations-in-part and extensions thereof; utility models, industrial designs, certificates of invention and design patents, and registrations and applications therefor; (b) trademarks, service marks, trade names, Internet domain names and registration rights, trade dress, logos, and corporate names, all goodwill associated therewith, and applications, registrations, and renewals in connection therewith; (c) computer software, databases, data and documentation, uniform resource locators, Internet and worldwide web sites and all related content and programming; (d) copyrights, published and unpublished works of authorship (including databases and software), and applications, registrations and renewals in connection therewith and all moral rights therein; (e) mask works and applications, registrations, and renewals in connection therewith; (f) trade secrets and confidential business information (including confidential ideas, research and development, know how, methods, formulas, compositions, manufacturing and production processes and techniques, technical data, designs, drawings, specifications, customer and supplier lists, pricing and cost information, and business and marketing plans and proposals) and rights to limit the use or disclosure thereof by any Person; (g) copies and tangible embodiments of the foregoing (in whatever form or medium); and (h) all rights that are equivalent or similar to the foregoing throughout the world; and licenses and claims of infringement and misappropriation against third parties. “Company Intellectual Property” shall mean all Intellectual Property Rights owned by the Company or any Company Subsidiary or used or held for use by the Company or any Company Subsidiary in their respective businesses, including, without limitation, Company Patents, Company Marks, Company Copyrights, Company Trade Names, Company Domain Names, Company Software and Company Trade Secrets.

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(p)          Takeover Statutes.  The Board has and will take all actions so that the restrictions and requirements (including requirements relating to shareholder approval) applicable to business combinations and acquisitions of shares contained in Sections 14-2-1110 et seq. and 14-2-1131 et seq. of the GBCC are, and will be, inapplicable to the execution, delivery and performance of this Agreement and to the consummation of the Transaction. The Board (at a meeting duly called and held) has approved this Agreement and the Transaction and the Contribution Agreement, the Subscription Agreements, the Employment Agreements, the Aircraft Lease and the transactions contemplated thereby for the purpose of any “moratorium”, “control share”, “fair price” or other antitakeover Laws or regulations of any state (including Sections 14-2-1110 et seq. and 14-2-1131 et seq. of the GBCC) (collectively the “Takeover Statutes”). No Takeover Statutes apply, or purport to apply, to the Agreement or the Transaction.

(q)          Financial Advisors.  No broker, investment banker or financial advisor (other than Harris Williams and Company (“HW”), which the Committee has retained as its financial advisor in connection with the Transaction, the fees and expenses of which will be paid by the Company), is entitled to any broker’s, finder’s, financial advisor’s or other similar fee or commission in connection with the negotiations leading to this Agreement or consummation of the Transaction, based upon arrangements made by or on behalf of the Company.

(r)          Opinion of Financial Advisor.  The Board has received an opinion of HW, dated the date hereof, and subject to the various assumptions and qualifications set forth in such opinion, to the effect that, as of such date, the Offer Price and the Common Merger Consideration is fair, from a financial point of view, to the holders of shares of Common Stock, which opinion has not been withdrawn or modified. The Company has provided Parent with a copy of such opinion.

(s)          Vote Required.  If at least ninety percent (90%) of the Common Stock is owned by the Purchaser following the Offer Closing, no vote of the shareholders of the Company shall be required to adopt this Agreement or approve the Transaction. In the event Approval is Required, the affirmative vote of a majority of the outstanding shares of Common Stock is the only vote of the holders of any class or series of capital stock of the Company or any Company Subsidiary necessary under the Company’s Organizational Documents and applicable Law to adopt this Agreement.

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(t)          Interested Party Transactions. Except as described in the Company SEC Documents or in Section 3.01(t) of the Company Disclosure Schedule, there are no, and since December 31, 2010, there have not been any, (i) transactions between the Company or any Company Subsidiary, on the one hand, and any director, officer, employee or Affiliate of the Company or any Company Subsidiary (or any family member of any of the foregoing), on the other hand, other than transactions between the Company and its wholly –owned Subsidiaries and compensation paid to directors, officers or employees in the ordinary course of business consistent with past practice or (ii) transactions between the Company or any Company Subsidiary, on the one hand, and any record or beneficial owner of more than 5% of the shares of capital stock of the Company, on the other hand.

(u)         Top Customers.  Section 3.01(u) of the Company Disclosure Schedule sets forth (i) a true, correct and complete list of each of the 10 largest customers of the Company and the Company Subsidiaries determined on a consolidated basis, as measured by net revenue to the Company and the Company Subsidiaries for the fiscal year ended December 31, 2012 (each, a “Top Customer”) and (ii) the net revenue to the Company and the Company Subsidiaries for the period beginning on January 1, 2013 and ending on October 31, 2013. Except as set forth in Section 3.01(u) of the Company Disclosure Schedule, since December 31, 2012, neither the Company nor any Company Subsidiary has terminated or suspended its relationship with any Top Customer. Except as set forth in Section 3.01(u) of the Company Disclosure Schedule, since December 31, 2012, no Top Customer has terminated or suspended its relationship as a customer of the Company or any Company Subsidiary or materially decreased its aggregate transactions with the Company or any Company Subsidiary (in each case, other than as a result of the expiration of Contracts with any Top Customer in accordance with their terms). Except as set forth in Section 3.01(u) of the Company Disclosure Schedule, since December 31, 2012, no Top Customer has delivered to the Company or any Company Subsidiary a written notice of termination or suspension of its relationship as a customer of the Company or such Company Subsidiary. Except as set forth in Section 3.01(u) of the Company Disclosure Schedule, to the Company’s Knowledge, there is no reasonable basis to believe that any Top Customer will terminate or suspend its relationship as a customer of the Company or any Company Subsidiary or will have a sustained material decrease with respect to its aggregate transactions with the Company or any Company Subsidiary.

(v)         Top Vendors.  Section 3.01(v) of the Company Disclosure Schedule sets forth (i) a true, correct and complete list of each of the 10 largest vendors of the Company and the Company Subsidiaries determined on a consolidated basis, as measured by net expense to the Company for the fiscal year ended December 31, 2012 (each, a “Top Vendor”) and (ii) the net expense to the Company for the period beginning on January 1, 2013 and ending on October 31, 2013. Except as set forth in Section 3.01(v) of the Company Disclosure Schedule, since December 31, 2012, neither the Company nor any Company Subsidiary has terminated or suspended its relationship with any Top Vendor (in each case, other than as a result of the expiration of Contracts with any Top Vendor in accordance with their terms). Except as set forth in Section 3.01(v) of the Company Disclosure Schedule, since December 31, 2012, no Top Vendor has terminated or suspended its relationship as a vendor of the Company or any Company Subsidiary or materially decreased its aggregate transactions with the Company or any Company Subsidiary (in each case, other than as a result of the expiration of Contracts with any Top Vendor in accordance with their terms). Except as set forth in Section 3.01(v) of the Company Disclosure Schedule, since December 31, 2012, no Top Vendor has delivered to the Company or any Company Subsidiary a written notice of termination or suspension of its relationship as a vendor of the Company or such Company Subsidiary (in each case, other than as a result of the expiration of Contracts with any Top Vendor in accordance with their terms). Except as set forth in Section 3.01(v) of the Company Disclosure Schedule, to the Company’s Knowledge, there is no reasonable basis to believe that any Top Vendor will terminate or suspend its relationship as a vendor of the Company or any Company Subsidiary or will have a sustained material decrease with respect to its aggregate transactions with the Company or any Company Subsidiary.

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(w)         Rule 14d-10 Matters.  Each of the Committee and the Compensation Committee, is composed solely of “independent directors” within the meaning of Rule 14d-10(d)(2) promulgated under the Exchange Act and the instructions thereto. On or prior to the date of this Agreement, the Committee or the Compensation Committee, at a meeting duly called and held, approved each Employment Agreement and the Aircraft Lease as an “employment compensation, severance or other employee benefit arrangement” within the meaning of Rule 14d-10(d)(1) promulgated under the Exchange Act.

(x)          No Other Representations or Warranties.  Except for the representations and warranties made by the Company in this Section 3.01, neither the Company nor any other Person on behalf of Company, including any director, officer or employee of Company, makes any express or implied representation or warranty with respect to the Company or any of its Subsidiaries in connection with the transactions contemplated hereby. Except in the event of fraud, neither the Company nor any other Person, including any director, officer or employee of the Company, will have or be subject to any liability or obligation to Parent, Purchaser or any other Person resulting from the distribution to Parent or Purchaser, or Parent’s or Purchaser’s use of, any such information, including any information, documents, projections, forecasts of other material made available to Parent or Purchaser in expectation of the Transaction.

Section 3.02.       Representations and Warranties of Parent and Purchaser.  Parent and Purchaser jointly and severally represent and warrant to the Company as follows:

(a)          Organization, Standing and Corporate Power.  Each of Parent and Purchaser is a corporation duly organized, validly existing and in good standing under the laws of the jurisdiction in which it is incorporated and has all requisite corporate power and authority to carry on its business as now being conducted. Each of Parent and Purchaser is duly qualified or licensed to do business and is in good standing in each jurisdiction in which the nature of its business or the ownership, leasing or operation of its properties makes such qualification or licensing necessary, except where the failure to be so qualified would not constitute a Parent Material Adverse Effect.

(b)         Authority; Noncontravention.

(i)          Each of Parent and Purchaser has all requisite corporate or other power and authority to execute and deliver this Agreement, to perform their respective obligations hereunder and to consummate the Transaction. The execution and delivery of this Agreement and the consummation of the Transaction have been duly authorized by the Board of Directors of each of Parent and Purchaser and no other corporate or other proceedings on the part of Parent or Purchaser are necessary to authorize this Agreement or to consummate the Transaction. This Agreement and the Transaction, do not require approval of the holders of any shares of capital stock of Parent. This Agreement has been duly executed and delivered by each of Parent and Purchaser and, assuming the due authorization, execution and delivery by the Company, constitutes a legal, valid and binding obligation of Parent and Purchaser, as applicable, enforceable against Parent and Purchaser, as applicable, in accordance with its terms, subject to the Bankruptcy and Equity Exceptions.

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(ii)         The execution and delivery of this Agreement does not, and the consummation of the Transaction, and compliance with the provisions of this Agreement will not, conflict with, or result in any violation or breach of, or default (with or without notice or lapse of time, or both) under, or give rise to a right of, or result in, termination, cancellation or acceleration of any obligation or to the loss of a benefit under, or result in the creation of any Lien in or upon any of the properties or other assets of Parent or Purchaser under (A) the Organizational Documents of Parent or Purchaser, (B) any material Contract to which Parent or Purchaser is a party or any of their respective properties or other assets is subject, in any way that would prevent, materially impede or materially delay the consummation of the Transaction (including the payments required to be made pursuant to ARTICLE II) or the other transactions contemplated hereby, or (C) subject to the governmental filings and other matters referred to in the following sentence, any (1) Law applicable to Parent or Purchaser or their respective properties or other assets, or (2) Order applicable to Parent or Purchaser or their respective properties or other assets.

(iii)        No consent, approval, Order or authorization of, action by or in respect of, or registration, declaration or filing with, any Governmental Entity is required by or with respect to Parent or Purchaser in connection with the execution and delivery of this Agreement by Parent and Purchaser or the consummation by Parent and Purchaser of the Transaction, except for the filing of a pre-merger notification and report form by Parent under the HSR Act and the receipt, termination or expiration, as applicable, of approvals or waiting periods required under the HSR Act or any other applicable competition, merger control, antitrust or similar law or regulation.

(c)          Ownership and Interim Operations of Purchaser. Parent owns, beneficially and of record, all of the outstanding capital stock of Purchaser. Purchaser was formed solely for the purpose of engaging in the Transaction, has engaged in no business activities other than incident to its formation and pursuant to this Agreement and has conducted its operations only as contemplated hereby.

(d)          Financing. Parent has delivered to the Company the fully executed Equity Commitment Letter pursuant to which the Guarantor has committed, subject to the terms and conditions of the Equity Commitment Letter, to invest the Equity Financing. The Equity Commitment Letter, in the form so delivered, is in full force and effect, has not been terminated or otherwise amended or modified and the commitment of the Guarantor set forth therein has not been withdrawn or rescinded in any respect. The Equity Commitment Letter constitutes a legal, valid and binding obligation of each of Parent and the Guarantor. Subject to the accuracy of the representations and warranties of the Company set forth in Section 3.01, as of the date of this Agreement, no event has occurred which, with or without notice or lapse of time or both, would constitute a material default under or material breach on the part of Parent or Guarantor under the Equity Commitment Letter. Subject to the terms and conditions of this Agreement, the accuracy of the representations and warranties of the Company set forth in Section 3.01 and compliance with the Company with its covenants and agreements under this Agreement, the Equity Financing, when funded in accordance with the terms and conditions of the Equity Commitment Letter, will provide Parent with funds sufficient to pay the aggregate Offer Price and the aggregate Common Merger Consideration, the aggregate Option Cash Amount and any fees and expenses of Parent, Purchaser or the Surviving Corporation in connection with the Transaction. Assuming the satisfaction of the conditions set forth in Sections 6.01 and 6.02, the obligation of the Guarantor to make the Equity Financing available to Parent pursuant to the terms of the Equity Commitment Letter are not subject to any conditions other than set forth in the Equity Commitment Letter.

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(e)          Ownership. As of the date of this Agreement, none of Parent, Purchaser or their respective Affiliates, directly or indirectly, beneficially own or control any shares of capital stock of the Company, and none of Parent, Purchaser or their respective Affiliates have any rights to acquire any shares of capital stock other than pursuant to this Agreement.

(f)          Legal Proceedings. There is no pending or, to the Knowledge of Parent, threatened, Proceeding against Parent, Purchaser or any of their respective Subsidiaries, nor is there any Order imposed upon Parent, Purchaser or any of their respective Subsidiaries, in each case, by or before any Governmental Entity, which would, individually or in the aggregate, reasonably be expected to result in a Parent Material Adverse Effect.

(g)          Certain Arrangements. Other than the Employment Agreements, the Contribution Agreement, the Subscription Agreements and the Aircraft Lease, there are no Contracts or commitments to enter into Contracts, between Parent or Purchaser or their respective Affiliates, on the one hand, and any member of the Company’s management or directors, on the other hand, as of the date hereof that relate in any way to the Company or the Transaction. During the past three (3) years immediately preceding the date of this Agreement, neither Parent nor any of its Affiliates has beneficially owned more than 15% of the outstanding Common Stock

(h)          Brokers and Other Advisors. No broker, investment banker, financial advisor or other Person is entitled to any broker’s, finder’s, financial advisor’s or other similar fee or commission in connection with Transaction based upon arrangements made by or on behalf of Parent or any of its Subsidiaries except for Persons whose fees and expenses will be paid by Parent.

(i)           Disclaimer of Other Representations and Warranties. Parent and Purchaser each acknowledges and agrees that, except for the representations and warranties expressly set forth in this Agreement (i) neither the Company nor any of its Subsidiaries or their respective directors, officers or employees makes, or has made, any representations or warranties relating to itself or its business or otherwise in connection with the Transaction and Parent and Purchaser are not relying on any representation or warranty except for those expressly set forth in this Agreement, (ii) no Person has been authorized by the Company to make any representation or warranty relating to itself or its Subsidiaries or its business or otherwise in connection with the Transaction, and if made, such representation or warranty must not be relied upon by Parent or Purchaser as having been authorized by the Company, and (iii) any estimates, projections, predictions, data, financial information, memoranda, presentations or any other materials or information provided or addressed to Parent, Purchaser or any of their Agents are not and shall not be deemed to be or to include representations or warranties, including any representations or warranties relating to the reasonableness of the assumptions underlying such estimates, projections and related information.

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(j)           Private Placement. Parent and Purchase understand and acknowledge that the Top-Up Option Shares that Purchaser may acquire upon exercise of the Top-Up Option will not be registered under the Securities Act and will be issued in reliance upon an exemption thereunder for transactions not involving a public offering. Each of Parent and Purchaser represents and warrants that the Top-Up Option Shares will be acquired by Purchaser for the purpose of investment and not with a view to, or for resale in connection with, any distribution thereof within the meaning of the Securities Act. Each of Parent and Purchaser further represents that Purchaser is an “accredited investor” as defined in Rule 501 of Regulation D under the Securities Act. Any certificates evidencing Top-Up Option Shares shall include any legends required by applicable Laws.

ARTICLE IV.
COVENANTS RELATING TO CONDUCT OF BUSINESS; NO SOLICITATION

Section 4.01.       Conduct of Business by the Company. During the period from the date of this Agreement to the Effective Time (or such earlier date on which this Agreement is terminated), except as required by applicable Law, consented to in writing in advance by Parent (which consent shall not be unreasonably withheld, delayed or conditioned), or otherwise specifically contemplated or permitted by or required pursuant to this Agreement, the Company shall, and shall cause each Company Subsidiary to, carry on its business in the ordinary course consistent with past practice and use commercially reasonable efforts to maintain and preserve intact its business organization and significant business relationships with customers and suppliers, retain the services of its key officers and employees and comply in all material respects with all applicable Laws. In addition to and without limiting the generality of the foregoing, during such period, except as required by applicable Law or as otherwise specifically contemplated or permitted by or required pursuant to this Agreement, the Company shall not, and shall not permit any of the Company Subsidiaries to, without Parent’s prior written consent (which such consent shall not be unreasonably withheld, delayed or conditioned):

(a)          (A) declare, set aside or pay any dividends on, or make any other distributions (whether in cash, stock or property or any combination of the foregoing) in respect of, any of its capital stock, except that the Company Subsidiaries may make distributions to the Company, (B) split, subdivide, combine or reclassify any of its capital stock or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for shares of its capital stock, or (C) purchase, redeem or otherwise acquire any shares of its capital stock or any other securities thereof or any rights, warrants or options to acquire any such shares or other securities, except for purchases, redemptions or other acquisitions of capital stock or other securities required under the terms of any plans, arrangements or Contracts existing on the date hereof between the Company or any of the Company Subsidiaries and any director, employee or former employee of the Company or any of its Subsidiaries or in connection with the exercise of Stock Options or the vesting of Restricted Stock;

(b)          issue, deliver, sell, grant, pledge or otherwise encumber or subject to any Lien, any shares of its capital stock, any other voting securities or any securities convertible into or exchangeable for, or any rights, warrants or options to acquire, any shares of capital stock, voting securities or convertible securities, or any “phantom” stock, “phantom” stock rights, stock appreciation rights or stock based performance units, including pursuant to Contracts as in effect on the date hereof (other than upon the exercise of Stock Options outstanding on the date hereof in accordance with their terms on the date hereof);

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(c)          amend any of the Organizational Documents of the Company or of any Company Subsidiary;

(d)          except as set forth on Schedule 4.01(d) hereto, make any acquisition (including by merger, consolidation, stock acquisition or otherwise) of the capital stock or (except in the ordinary course of business or as otherwise permitted pursuant to this Agreement) assets of any other Person for consideration in excess of $250,000 per transaction or $500,000 in the aggregate;

(e)          adopt a plan or agreement of complete or partial liquidation or dissolution, merger, consolidation, restructuring, recapitalization or other reorganization of the Company or any Company Subsidiary;

(f)          except in the ordinary course of business or pursuant to credit facilities or other arrangements (including intercompany arrangements) in existence as of the date hereof, incur any material amount of Indebtedness, guarantee any material amount of Indebtedness of any Person or issue or sell debt securities;

(g)          sell, lease, license, mortgage, sell and leaseback or otherwise encumber or subject to any Lien or otherwise dispose of any of its properties or other assets or any interests therein (including securitizations), except (A) for sales, licenses or dispositions of properties or other assets or interests therein in the ordinary course of business consistent with past practice, (B) existing Liens securing existing Indebtedness, (C) pursuant to Contracts in force as of the date hereof, (D) dispositions of obsolete or worthless assets that are no longer useful in the conduct of the business of the Company in the ordinary course of business consistent with past practice, or (E) for transfers among the Company and its Subsidiaries in the ordinary course of business consistent with past practice;

(h)          make or authorize capital expenditures except (A) as budgeted in the Company’s fiscal year 2013 plan approved by the Board that was made available to Parent prior to the date hereof, (B) in the ordinary course of business consistent with past practice or (C) otherwise in an amount not to exceed $200,000 per capital expenditure or $375,000 in the aggregate;

(i)          pay, discharge, settle or satisfy any Proceeding, other than (A) settlements of any Proceeding set forth on Section 3.01(g) of the Company Disclosure Schedule subject to the limits and conditions set forth on Section 3.01(g) of the Company Disclosure Schedule, (B) settlements of any Proceeding or threatened Proceeding that (1) require payments by the Company or any Company Subsidiary (net of insurance proceeds) in an amount not to exceed $75,000 individually or $200,000 in the aggregate and (2) do not require any other actions or impose any other material restrictions on the business or operations of the Company and the Company Subsidiaries or (C) settlement of any workers’ compensation claims or employee claims filed with the Equal Employment Opportunity Commission, in each case, so long as such settlement is in the ordinary course of business consistent with past practice;

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(j)          amend, waive or modify in any material respect or terminate or fail to renew any Material Contract (other than in the ordinary course of business consistent with past practice) or enter into any Contract that would constitute a Material Contract if in effect on the date of this Agreement;

(k)          amend, waive or modify in any manner materially adverse to the Company or any Company Subsidiary any Affiliate Transaction or enter into any Contract or transaction that would constitute an Affiliate Transaction if in effect on the date of this Agreement;

(l)          except as set forth on Schedule 4.01(l) of the Company Disclosure Schedule or as required to comply with applicable Law or to comply with any Contract entered into prior to the date hereof (A) adopt, enter into, terminate or materially amend (1) any Company Benefit Plan or (2) any other Contract or policy involving the Company or any Company Subsidiary and one or more of their respective current or former employees or members of the Board that is not terminable at will, (B) increase the compensation, bonus, change of control, severance or fringe or other benefits offered by the Company or the Company Subsidiaries other than increases in the ordinary course of business consistent with past practice, (C) except as otherwise contemplated by this Agreement, amend or modify any Stock Option, (D) except as required by Sections 2.03(a) and 2.03(b) of this Agreement, take any action to accelerate the vesting or payment of any compensation or benefit under any Company Benefit Plan or (E) loan or advance any money or other property (other than reimbursement of reimbursable expenses or any advances of such expenses, whether directly, pursuant to Company credit cards or otherwise, in the ordinary course of business consistent with past practice) to any current or former member of the Board or officer of the Company or any Company Subsidiary; (F) enter into any agreement or engage in any transaction with one or more of the Company’s directors, officers or shareholders, or with any corporation, partnership (general or limited), limited liability company, association or other organization of which one or more of the Company’s directors, officers or shareholders is (x) a director, officer, manager, managing partner, managing member (or the holder of any office with similar authority), (y) has a direct or indirect financial interest, or (z) directly or indirectly controls, is controlled by or is under common control with;

(m)         enter into any collective bargaining Contract or other Contract with a labor union, works council or similar organization;

(n)          adopt or implement any shareholder rights plan or similar arrangement;

(o)          enter into any Contract with respect to the voting or transfer of its capital stock, voting securities or other equity interests;

(p)          change the Company’s registered public accounting firm or implement or adopt and change in its tax or financial accounting principles, practices or methods, other than as may be required by GAAP or applicable Law;

(q)          enter into any Contract with respect to taxes, settle or compromise any liability for taxes, make, revoke or change any tax election, agree to any adjustment of any material tax attribute, file or surrender any claim for a refund of taxes, execute or consent to any waivers extending the statutory period of limitations with respect to the collection or assessment of any taxes or file any amended tax return;

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(r)          cancel any Indebtedness owed to the Company or any Company Subsidiary or waive any other rights or claims of material value;

(s)          other than in the ordinary course of business consistent with past practice, change, in any material respect, any credit policies or policies or practices relating to the collection of receivables or payment of payables; or

(t)          authorize or agree or commit to take any of the foregoing actions.

Section 4.02.        No Solicitation.

(a)          On the date hereof the Company will, and will instruct and cause the Company’s directors, officers, employees, investment bankers, financial advisors, attorneys, accountants and other representatives (collectively, “Agents”), the Company Subsidiaries and their respective Agents to, immediately cease all discussions and negotiations with any Persons that may be ongoing with respect to a Takeover Proposal, and deliver a written notice to each such Person to the effect that the Company is ending all discussions and negotiations with such Person with respect to any Takeover Proposal and such notice shall also request such Person to promptly return or destroy all confidential information concerning the Company and the Company Subsidiaries.

(b)         The Company shall not, nor shall it permit any of the Company Subsidiaries to, nor shall it authorize or permit any of its or the Company Subsidiaries’ Agents to (i) solicit, initiate, knowingly encourage or facilitate, or take any other action with the intent to generate, or which would reasonably be expected to lead to or result in, any inquiries or the making of any proposal or offer that constitutes, or may reasonably be likely to lead to, any Takeover Proposal, (ii) provide any non-public information, or afford access to the properties, books, records, or personnel of the Company or any of the Company Subsidiaries, to any Person that the Company has reason to believe is considering making, or has made, any Takeover Proposal or any proposal that may reasonably be expected to lead to a Takeover Proposal, (iii) enter into, maintain, continue or participate in, any discussions or negotiate with any Person in furtherance of such inquiries or to obtain a Takeover Proposal or otherwise in connection with any Takeover Proposal, (iv) approve, endorse, recommend, or execute or enter into any letter of intent, agreement in principle, merger agreement, acquisition agreement or other similar agreement relating to a Takeover Proposal (other than an Acceptable Confidentiality Agreement entered into pursuant to Section 4.02(c)) (an “Acquisition Agreement”) or any proposal or offer that could reasonably be expected to lead to a Takeover Proposal, (v) approve, endorse or recommend or publicly announce or resolve its intention to approve, endorse or recommend any Takeover Proposal, (vi) terminate, release, amend, waive or modify any provision of any standstill or other similar agreement (or fail to take reasonable steps to enforce the provisions of such agreements), (vii) take any action to make the provisions of any Takeover Statute or any restrictive provision of any applicable anti-takeover provision in the Organizational Documents of the Company or any Company Subsidiary in applicable to any Takeover Proposal, or (viii) resolve or agree to do any of the foregoing or otherwise authorize or permit any of its Agents to take any such action.

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(c)          Notwithstanding anything to the contrary in this Section 4.02, if, prior to the Offer Closing, or in the event Approval is Required, prior to obtaining Shareholder Approval, the Board receives a bona fide written Takeover Proposal from any Person, which Takeover Proposal did not result from any breach of this Section 4.02 by the Company or its Agents, then the Company may, pursuant to a confidentiality agreement with provisions relating to confidentiality that are no less favorable to the Company than the provisions of the Confidentiality Agreement (it being understood that such confidentiality agreement shall contain provisions that expressly permit the Company to comply with the terms of this Agreement, including Section 4.02 hereunder) (an “Acceptable Confidentiality Agreement”), furnish non-public information to the Person making such Takeover Proposal, provided that such information either has been provided to Parent or is promptly provided to Parent, and, following the execution of such Acceptable Confidentiality Agreement, afford access to the properties, books, records, and personnel of the Company or any of the Company Subsidiaries to, and enter into discussions or negotiations with, such Person in connection with a Takeover Proposal, provided, however, that prior to taking any of the foregoing actions, (i) the Board has determined in good faith, after consultation with its financial advisor and outside legal counsel, that such Takeover Proposal is, or is reasonably be likely to lead to the delivery of, a Superior Proposal, and (ii) the Board has determined in good faith, after consultation with its financial advisor and outside legal counsel, that the failure to take such action is inconsistent with the directors’ fiduciary duties under applicable Law.

(d)          The Company will notify Parent promptly, but in no event later than 48 hours, after receipt by the Company or any Company Subsidiary (or any of their respective Agents) of any Takeover Proposal, which notice shall include a copy of the Takeover Proposal. The Company will keep Parent reasonably informed, on a prompt basis, of the status of any such Takeover Proposal or request (including the material terms and conditions thereof and any modifications thereto). The Company shall provide Parent with at least 48 hours prior notice of any meeting of the Board at which the Board is reasonably expected to consider any Takeover Proposal.

(e)          For purposes of this Agreement:

(i)          “Takeover Proposal” means any bona fide inquiry, proposal, request for information, offer or indication of interest from any Person (other than Parent and its Subsidiaries) or “group”, within the meaning of Section 13(d) of the Exchange Act, relating to, in a single transaction or series of related transactions, any (A) sale, lease, exchange, transfer, license (other than licenses in the ordinary course of business), acquisition or disposition of assets of the Company or the Company Subsidiaries equal to 20% or more of the Company’s consolidated assets or to which 20% or more of the Company’s net revenues or net income on a consolidated basis are attributable, (B) acquisition of 20% or more of any class of voting securities or other equity interests of the Company or any Company Subsidiary (or, in the case of any person beneficially owning (for purposes of Section 13(d) of the Exchange Act) 20% or more of the outstanding shares of Common Stock as of the date of this Agreement, any additional shares of any class of outstanding voting securities or other equity interests of the Company or any Company Subsidiary), (C) tender offer or exchange offer that if consummated would result in any Person beneficially owning 20% or more (or, in the case of any person beneficially owning (for purposes of Section 13(d) of the Exchange Act) 20% or more of the outstanding shares of Common Stock as of the date of this Agreement, any additional shares) of any class of outstanding voting or equity securities or other equity interests of the Company or any Company Subsidiary, (D) liquidation, dissolution, recapitalization, extraordinary dividend or other reorganization of the Company or any Company Subsidiary, or (E) any combination of the foregoing types of transactions, in each case, other than the Transaction;

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(ii)         “Superior Proposal” means a written, bona fide proposal or offer, or series of related proposals or offers, made by any Person or “group” (as such term is defined in Section 13(d) of the Exchange Act) to consummate an Acquisition Transaction, which, in the good faith determination of the Board (after consultation with its financial advisor and its outside legal counsel), taking into consideration the various legal, financial, and regulatory aspects of such Acquisition Transaction and the Person or group making the proposal or proposals for such Acquisition Transaction (including any required financing, shareholder approval requirements of the Person or group making the proposal, regulatory approvals, shareholder litigation, breakup fee and expense reimbursement provisions, ability to satisfy conditions to closing, expected timing and risk and likelihood of consummation, and, to the extent deemed appropriate by the Board, such other factors that may be considered in making such a determination under the GBCC), (A) if accepted, is reasonably likely to be consummated and (B) if consummated, would result in a transaction that is more favorable from a financial point of view to the shareholders of the Company than the Transaction (taking into account all of the terms of any proposal by Parent to amend or modify the terms of the Transaction); and

(iii)        “Acquisition Transaction” shall mean a merger, consolidation, business combination, recapitalization, liquidation, dissolution, sale or disposition or similar transaction involving the Company or any of the Company Subsidiaries pursuant to which a Person (or its shareholders) would own, if consummated, all or substantially all of the outstanding capital stock of the Company (or of the surviving entity in a merger or the direct or indirect parent of the surviving entity in a merger) or all or substantially all of the assets of the Company and the Company Subsidiaries taken as a whole.

(f)          Except as permitted by Section 4.02(g), neither the Board nor any committee thereof (including the Committee) shall (i)(A) amend, change, qualify, withhold, withdraw, modify, or fail to make, or publicly propose to amend, change, qualify, withhold, withdraw, modify or fail to make, the Company Recommendation or fail to include the Company Recommendation in the Schedule 14D-9 (or in the event Approval is Required, the Proxy Statement), or (B) adopt, approve, endorse or recommend, or publicly propose to adopt, approve, endorse or recommend to the shareholders of the Company any Takeover Proposal, Acquisition Transaction or Superior Proposal, (ii) fail to recommend against acceptance of any tender or exchange offer for the Company Common Stock and reaffirm the Company Recommendation within ten (10) Business Days after commencement of such offer, (iii) make any public statement inconsistent with the Company Recommendation (actions described in clauses (i)-(iii) being referred to as a “Company Adverse Recommendation Change”), (iv) authorize, cause or permit the Company or any of the Company Subsidiaries or any of their respective Agents to enter into any Acquisition Agreement, (v) take any action pursuant to Section 7.01(d)(ii) or (vi) resolve to do any of the foregoing.

(g)          Notwithstanding anything to the contrary set forth in this Agreement, including Section 4.02(f), prior to the Offer Closing (or in the event Approval is Required, the time Shareholder Approval is obtained), but not after, the Board may make a Company Adverse Recommendation Change:

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(i)          in order to enter into an Acquisition Agreement with respect to an Acquisition Transaction in connection with the termination of this Agreement pursuant to Section 7.01(d)(ii) if the Board has determined in good faith, after consultation with its financial advisor and outside legal counsel, (A) that failure to take such action is inconsistent with the directors’ fiduciary duties under applicable Law and (B) that such Acquisition Transaction constitutes a Superior Proposal, but only after (1) the Company has given Parent at least four (4) Business Days’ prior written notice of its intention to take such action (which notice shall include a copy of the Superior Proposal, a copy of the relevant proposed transaction agreements and a copy of any financing commitments relating thereto), (2) the Company has negotiated, and has caused its Agents to negotiate, in good faith with Parent during such notice period, to the extent Parent wishes to negotiate, to enable Parent to propose revisions to the terms of this Agreement and any other agreements relating to the Transaction (and consider such revisions in good faith) such that it would cause such Acquisition Transaction to no longer constitute a Superior Proposal, (3) following the end of such notice period, the Board shall have considered in good faith any proposed revisions to this Agreement and any other agreements relating to the Transaction proposed in writing by Parent in a manner that would form a binding contract if accepted by the Company, and shall have determined that the Acquisition Transaction would continue to constitute a Superior Proposal if such revisions were to be given effect, (4) in the event of any material change to the material terms of such Acquisition Transaction, the Company shall, in each case, have delivered to Parent an additional notice consistent with that described in clause (1) above and the notice period shall have recommenced, except that the notice period shall be at least three (3) Business Days (rather than the four (4) Business Days contemplated by clause (1) above), (5) the Company has complied in all material respects with its obligations under this Section 4.02 and (6) if this Agreement is terminated in accordance with Sections 7.01(c)(ii), (c)(iii) or (d)(ii), the Company shall have paid the Termination Fee in accordance with Section 7.02(b) or Section 7.02(c), as the case may be; or

(ii)         if: (A) a material development or change in circumstances occurs or arises after the date of this Agreement that was not known or reasonably foreseeable (but that does not relate to a Takeover Proposal or the Transaction) to the Company as of the date of this Agreement (such material development or change in circumstances being referred to as an “Intervening Event”); (B) at least five Business Days prior to any meeting of the Board at which the Board will consider and determine whether such Intervening Event requires the Board to effect, or cause the Company to effect, a Company Adverse Recommendation Change, the Company provides Parent with a written notice specifying the date and time of such meeting and the reasons for holding such meeting; (C) during such five Business Day period, if requested by Parent, the Company engages in good-faith negotiations with Parent to amend this Agreement in a manner that obviates the need for the Board to effect, or cause the Company to effect, a Company Adverse Recommendation Change as a result of such Intervening Event; and (D) the Board determines in good faith that such change is reasonably required, after consultation with its outside legal counsel, to comply with its fiduciary duties.

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(h)          Nothing contained in this Section 4.02 shall prohibit the Company from (i) taking and disclosing to its shareholders a position contemplated by Rule 14d-9 or Rule 14e-2(a) promulgated under the Exchange Act; provided that any disclosure permitted under this Section 4.02(g) that does not contain either an express rejection of any applicable Takeover Proposal or an express reaffirmation of the Company Recommendation shall be deemed a Company Adverse Recommendation Change, or (ii) making any “stop-look-and-listen” communication to the shareholders of the Company pursuant to Section 14d-9(f) promulgated under the Exchange Act (or any similar communications to the shareholders of the Company) in which the Company indicates that it has not changed the Company Recommendation.

ARTICLE V.
ADDITIONAL AGREEMENTS

Section 5.01.        Schedule 13E-3; Proxy Statement. 

(a)          On the date the Offer Documents and the Schedule 14D-9 are initially filed with the SEC, the Company and Purchaser shall, in a manner that complies with Rule 13e-3 promulgated under the Exchange Act, jointly file with the SEC a Rule 13e-3 Transaction Statement on Schedule 13E-3 with respect to the Transaction (together with all amendments, supplements and exhibits thereto, the “Schedule 13E-3”) and shall jointly mail the Schedule 13E-3 to the holders of Common Stock promptly after filing the Schedule 13E-3 with the SEC. Each of Parent, Purchaser and the Company shall promptly correct any information provided by it for use in the Schedule 13E-3 if and to the extent that such information shall have become false or misleading in any material respect, and each of Parent, Purchaser and the Company shall take all steps necessary to amend or supplement the Schedule 13E-3 and to cause the Schedule 13E-3, as so amended or supplemented, to be filed with the SEC and disseminated to the Company’s shareholders, in each case as and to the extent required by the Exchange Act. Each of the Company, Purchaser and their respective counsel shall be given a reasonable opportunity to review the Schedule 13E-3 before it is filed with the SEC. Each of Parent, Purchaser and the Company shall promptly notify the other parties upon the receipt of any comments from the SEC (or the staff of the SEC) or any request from the SEC (or the staff of the SEC) for amendments or supplements to the Schedule 13E-3, and shall provide the other parties with copies of all correspondence (or telephonic notice of any oral responses or discussions) with the SEC (or the staff of the SEC). Each of Parent, Purchaser and the Company and Purchaser shall use reasonable best efforts to respond as promptly as reasonably practicable to any comments of the SEC (or the staff of the SEC) with respect to the Schedule 13E-3. Prior to the filing of any amendment or supplement to the Schedule 13E-3 or responding to any comments of the SEC (or the SEC staff) with respect to the Schedule 13E-3, each of Parent, Purchaser and the Company shall have a reasonable opportunity to review and to propose comments on such document or response.

(b)          As promptly as practicable following the time it is determined that Approval is Required, but in no event later than twenty (20) calendar days after such time, the Company and Parent shall prepare, and the Company shall file with the SEC, the Proxy Statement (which shall, subject to Section 4.02, include the Company Recommendation), and the Company shall use its commercially reasonable efforts to respond as promptly as practicable to any comments of the SEC and its staff with respect thereto or the Transaction (whether written or oral) and, to the extent permitted by applicable Law, to commence mailing of the Proxy Statement to the shareholders of the Company as promptly as practicable (but in no event prior to the clearance of the Proxy Statement by the SEC) after responding to all such comments to the satisfaction of the SEC and its staff. The Company shall promptly notify Parent and its legal counsel upon the receipt of any such comments from the SEC or its staff or any request from the SEC or its staff for amendments or supplements to the Proxy Statement, and shall provide Parent and its legal counsel with copies of all correspondence between the Company and its Agents, on the one hand, and the SEC and its staff, on the other hand. Prior to filing or mailing the Proxy Statement (or any amendment or supplement thereto) or responding to any comments of the SEC or the staff of the SEC with respect thereto, the Company (i) shall provide Parent and its legal counsel an opportunity to review and comment on such document or response and (ii) provide Parent and its counsel a reasonable opportunity to advise in connection with any discussions or meetings with the SEC; provided that Parent shall use commercially reasonable efforts to provide or cause to be provided its comments to the Company as promptly as reasonably practicable after such document or response is transmitted to Parent for its review.

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(c)          Parent and the Company shall each cooperate in the preparation of the Proxy Statement and any amendment or supplement thereto. Without limiting the generality of the foregoing, each of the Company, Parent and Purchaser, as the case may be, shall promptly furnish to the Company in writing the information relating to them required by the Exchange Act to be set forth in the Proxy Statement. The Company shall use commercially reasonable efforts to ensure that the Proxy Statement (i) will not on the date it is first mailed to shareholders of the Company and at the time of the Shareholders’ Meeting contain any untrue statement of a material fact or omit to state any material fact required to be stated therein in order to make the statements therein, in light of the circumstances under which they are made, not misleading and (ii) will comply as to form in all material respects with the applicable requirements of the Exchange Act. Notwithstanding the foregoing, the Company assumes no responsibility with respect to information supplied in writing by or on behalf of Parent or Purchaser for inclusion or incorporation by reference in the Proxy Statement. If, at any time prior to receipt of the Shareholder Approval, any event occurs with respect to the Company, any of the Company Subsidiaries, Parent or Purchaser, or any change occurs with respect to other information to be included in the Proxy Statement, which is required to be described in an amendment of, or a supplement to, the Proxy Statement, the Company or Parent, as the case may be, shall promptly notify the other party of such event and the Company shall promptly file, following compliance with Section 5.01(a), any necessary amendment or supplement to the Proxy Statement, and thereafter promptly prepare and disseminate amended or supplemented proxy materials (and, if required in connection therewith, re-solicit proxies).

(d)          Unless this Agreement has been terminated pursuant to Section 7.01, the Company shall, as soon as practicable after the Proxy Statement has been cleared by the SEC and its staff for mailing to the shareholders of the Company, duly call, give notice of, convene, set a record date for, and hold a meeting of the shareholders of the Company (including any adjournment or postponement thereof, the “Shareholders’ Meeting”) for the purpose of obtaining Shareholder Approval to adopt this Agreement and approve the Merger, in each case, duly called and held for such purpose; provided, however, for the avoidance of doubt, the Company may postpone or adjourn the Shareholders’ Meeting only (i) after consultation with, and the consent of, Parent or (ii) if, as of the time for which the Shareholders’ Meeting is originally scheduled (as set forth in the Proxy Statement), there are insufficient shares of Common Stock represented (either in person or by proxy) to constitute a quorum necessary to conduct the business of the Shareholders’ Meeting. The Company shall, upon the reasonable request of Parent, advise Parent at least on a daily basis on each of the last seven Business Days prior to the date of the Shareholders’ Meeting as to the aggregate tally of proxies received by the Company with respect to the adoption of this Agreement. “Shareholder Approval” is obtained at the Shareholders’ Meeting if (x) at least a majority of the outstanding shares of Common Stock entitled to vote thereon vote in favor of adopting the Agreement and approving the Merger and (y) at least a majority of the outstanding shares of Common Stock entitled to vote thereon (excluding in the case of this clause (y) all shares of Common Stock beneficially owned, whether directly or indirectly, by Scott D. Dorfman) vote in favor of adopting the Agreement and approving the Merger.

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(e)          Unless the Board shall have effected a Company Adverse Recommendation Change in accordance with Section 4.02(g), the Board shall make the Company Recommendation, include such Company Recommendation in the Proxy Statement and use its reasonable best efforts to obtain the Shareholder Approval (including soliciting proxies in favor of the approval of the adoption of this Agreement and the Merger from its shareholders). A Company Adverse Recommendation Change effected by the Board in accordance with Section 4.02(g), however, will not relieve the Company from its obligations hereunder other than as set forth in the prior sentence, and unless this Agreement is terminated in accordance with Section 7.01, the Company shall remain obligated to duly call, give notice of, convene, set a record date for, and hold, the Shareholders’ Meeting in accordance with Section 5.01(c), and submit this Agreement and the Merger for approval by the holders of Common Stock at the Shareholders’ Meeting. The notice of such Shareholders’ Meeting shall state that a resolution to approve and adopt this Agreement and the Merger will be considered at the Shareholder Meeting

Section 5.02.        Access to Information; Confidentiality.

(a)          Subject to restrictions under applicable Law, the Company shall afford to Parent, and to Parent’s officers, employees, accountants, counsel, financial advisors, and their respective Agents, reasonable access, during normal business hours and upon reasonable prior notice to the Company during the period prior to the Effective Time or the termination of this Agreement, to all of its and the Company Subsidiaries’ properties, assets, books, Contracts, personnel, Agents and records and, during such period, the Company shall furnish promptly to Parent and its Agents (i) a copy of each Company SEC Document to be filed with or furnished to the SEC after the date hereof, (ii) such financial and operating data and other information concerning the properties, assets, books, Contracts, personnel and other aspects of the Company and the Company Subsidiaries as Parent may reasonably request (including the financial results of the Company in advance of any filing by the Company with the SEC containing such financial results), (ii) a copy of each material correspondence or written communication with any Governmental Entity, (iii) copies of any correspondence received by the Company relating to the status of the IPOF Approvals and any other information concerning the IPOF Approvals or any other Proceedings involving the Common Stock held by the IPOF Receiver and (iv) all other information as Parent may reasonably request; provided, however, that the Company may restrict the foregoing access to such information or personnel to the extent that such disclosure would, based on the advice of outside legal counsel, result in a waiver of attorney-client privilege, the work product doctrine or any other applicable privilege applicable to such information; provided, further, that the Company shall use its commercially reasonable efforts to enter into a joint defense agreement with Parent or implement such other techniques to permit access to such information or personnel if, in the opinion of counsel to the Company, such techniques permit the disclosure of such information or access to such personnel without violating applicable Law or jeopardizing such privilege.

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(b)          Except for disclosures expressly permitted by the terms of the confidentiality agreement, dated July 26, 2013, between the Company and Parent (as amended from time to time, the “Confidentiality Agreement”), Parent shall hold, and shall cause Purchaser and its and Purchaser’s respective officers, employees, accountants, counsel, financial advisors and other Agents to hold, all information received from the Company, directly or indirectly, in confidence in accordance with the Confidentiality Agreement.

(c)          No investigation pursuant to this Section 5.02 or information provided or received by any party hereto pursuant to this Agreement will affect any of the representations or warranties of the parties hereto contained in this Agreement or the conditions hereunder to the obligations of the parties hereto.

Section 5.03.        Reasonable Best Efforts.

(a)          Upon the terms and subject to the conditions set forth in this Agreement, each of the parties agrees to use its respective reasonable best efforts to take, or cause to be taken, all actions, and to do, or cause to be done, and to assist and cooperate with the other parties in doing, all things necessary, proper or advisable to consummate and make effective, in the most expeditious manner practicable, the Transaction, including using its respective reasonable best efforts to accomplish the following: (i) the taking of all acts necessary to cause the conditions to Closing to be satisfied as promptly as practicable, including the receipt of the IPOF Approvals; (ii) the obtaining of all necessary actions or nonactions, waivers, consents and approvals from Governmental Entities and the making of all necessary registrations and filings (including filings with Governmental Entities) and the taking of all steps as may be necessary to obtain an approval or waiver from, or to avoid an action or proceeding by, any Governmental Entity; and (iii) the delivery of required notices to and the obtaining of all necessary consents, approvals or waivers from third parties under any Material Contract or Company Lease or otherwise to the extent related to the Transaction.

(b)          In furtherance and not in limitation of the foregoing:

(i)          Each of Parent and the Company shall (A) make or cause to be made all filings required of each of them or any of their respective Subsidiaries or Affiliates under the HSR Act or any other applicable Antitrust Laws with respect to the Transaction as promptly as practicable and, in any event, within ten (10) Business Days after the date of this Agreement, (B) comply at the earliest practicable date with any request under the HSR Act or other Antitrust Laws for additional information, documents, or other materials received by each of them or any of their respective Subsidiaries from the Federal Trade Commission (“FTC”), the Antitrust Division of the Department of Justice (the “Antitrust Division”) or any other Governmental Entity in respect of such filings or such transactions, and (C) cooperate with each other in connection with any such filing (including, to the extent permitted by applicable Law, providing copies of all such documents to the non-filing parties prior to filing and considering all reasonable additions, deletions or changes suggested in connection therewith) and in connection with resolving any investigation or other inquiry of any of the FTC, the Antitrust Division or other Governmental Entity under any Antitrust Laws with respect to any such filing or any such transaction. Each such party shall furnish to each other all information required for any application or other filing to be made pursuant to any applicable Law in connection with the Transaction. Each such party shall promptly inform the other parties hereto of any oral communication with, and provide copies of written communications with, any Governmental Entity regarding any such filings or any such transaction. No party hereto shall independently participate in any substantive meeting or discussion, either in person or by telephone, with a Governmental Entity in respect of any such filings, investigation, or other inquiry without giving the other parties hereto prior notice of the meeting and, to the extent permitted by such Governmental Entity, the opportunity to attend and/or participate. Subject to applicable Law, the parties hereto will consult and cooperate with one another in connection with any analysis, appearances, presentations, memoranda, briefs, arguments, opinions and proposals made or submitted by or on behalf of any party hereto relating to proceedings under the HSR Act or other Antitrust Laws.

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(ii)         Each of Parent and the Company shall use its respective reasonable best efforts to resolve such objections, if any, as may be asserted by any Governmental Entity with respect to the Transaction under the HSR Act, the Sherman Act, as amended, the Clayton Act, as amended, the Federal Trade Commission Act, as amended, and any other Laws that are designed to prohibit, restrict or regulate actions having the purpose or effect of monopolization or restraint of trade (collectively, the “Antitrust Laws”). Each of Parent and the Company shall use its respective reasonable best efforts to take such action as may be required to cause the expiration of the notice periods under the HSR Act or other Antitrust Laws with respect to such transactions as promptly as possible after the execution of this Agreement, including by requesting early termination of the waiting period under the HSR Act.

(c)          Notwithstanding anything to the contrary herein, in connection with the receipt of any necessary governmental approvals or clearances (including under any Antitrust Law), nothing in this Agreement shall require Parent or Purchaser, nor shall the Company or any of its Subsidiaries without the prior written consent of Parent agree or proffer to, divest, hold separate, or enter into any license or similar agreement with respect to, or agree to restrict the ownership or operation of, or agree to conduct or operate in a specified manner, any portion of the business or assets of Parent, any Affiliate of Parent, the Company or any of their respective Subsidiaries. Notwithstanding anything to the contrary herein, in no event shall Parent or any of its Subsidiaries be obligated to litigate or participate in the litigation of any Proceeding or appeal any Order issued, granted or entered by any Governmental Entity (i) challenging or seeking to make illegal, delay materially or otherwise directly or indirectly restrain or prohibit the consummation of the Transaction or seeking to obtain from Parent or any of its Subsidiaries any damages in connection therewith, or (ii) seeking to prohibit or limit in any respect, or place any conditions on, the ownership or operation by the Company, Parent or any of their respective Affiliates of all or any portion of the business, assets or any product of the Company or any of its Subsidiaries or Parent or any of its Subsidiaries or Affiliates or to require any such Person to dispose of, license (whether pursuant to an exclusive or nonexclusive license) or enter into a consent decree or hold separate all or any portion of the business, assets or any product of the Company or any of its Subsidiaries or Parent or any of its Subsidiaries or Affiliates, in each case as a result of or in connection with the Transaction. Without limiting the generality of the foregoing, the Company (i) shall give Parent the opportunity to participate in the defense of any Proceeding against the Company and/or its directors relating to the Transaction, and (ii) will obtain the prior written consent of Parent prior to settling or satisfying any such Proceeding, unless the effects of any such settlement or satisfaction do not include any of the effects described in this Section 5.03(c).

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Section 5.04.        Indemnification; Advancement of Expenses; Exculpation and Insurance.

(a)          From and after the Effective Time, Parent and the Surviving Corporation shall (i) indemnify and hold harmless each individual who at the Effective Time is, or at any time prior to the Effective Time was, a director or officer of the Company or any of its Subsidiaries (each, an “Indemnitee” and, collectively, the “Indemnitees”) with respect to all claims, liabilities, losses, damages, judgments, fines, penalties, costs (including amounts paid in settlement or compromise) and expenses (including fees and expenses of legal counsel) in connection with any claim, suit, action, proceeding or investigation (whether civil, criminal, administrative or investigative), whenever asserted, based on or arising out of, in whole or in part, (A) the fact that an Indemnitee was a director or officer of the Company or any of its Subsidiaries or (B) acts or omissions by an Indemnitee in the Indemnitee’s capacity as a director, officer or employee of the Company or any of its Subsidiaries or taken at the request of the Company or any of its Subsidiaries (including in connection with serving at the request of the Company or any of its Subsidiaries as a director, officer, employee, trustee or fiduciary of another Person (including any Company Benefit Plan), in each case under (A) or (B), at, or at any time prior to, the Effective Time (including any claim, suit, action, proceeding or investigation relating in whole or in part to the Transaction), to the fullest extent permitted under applicable Law, and (ii) assume all obligations of the Company and the Company Subsidiaries to the Indemnitees in respect of indemnification and exculpation from liabilities for acts or omissions occurring at or prior to the Effective Time as provided in (1) the Organizational Documents of the Company and the Company Subsidiaries as in effect on the date of this Agreement, and (2) any indemnification agreement between any such Indemnitee and the Company or any of the Company Subsidiaries as currently in effect, which agreements shall survive the Transaction and continue in full force and effect in accordance with their terms. In addition, from and after the Effective Time, the Surviving Corporation shall pay any expenses (including fees and expenses of legal counsel) of any Indemnitee under this Section 5.04 (including in connection with enforcing the indemnity and other obligations referred to in this Section 5.04) as incurred to the fullest extent permitted under applicable Law, provided that the person to whom expenses are advanced provides an undertaking to repay such advances to the extent required by applicable Law. Notwithstanding anything to the contrary herein, all rights to indemnification and advancement of expenses existing in favor of, and all limitations on the personal liability of, each Indemnified Party provided for in this Section 5.04 or in the Organizational Documents of the Company and the Company Subsidiaries or otherwise in effect as of the date hereof (including through any indemnification agreement) shall not be modified, and shall survive the Transaction and continue in full force and effect for a period of six (6) years from the Effective Time; provided, however, that all rights to indemnification, advancement of expenses and limitations on personal liability in respect of any claim, suit, action, proceeding or investigation asserted or made within such period shall continue until the final disposition of such claim, suit, action, proceeding or investigation.

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(b)          For the six (6) year period commencing immediately after the Effective Time, Parent shall maintain in effect the Company’s current directors’ and officers’ liability insurance covering acts or omissions occurring at or prior to the Effective Time with respect to those persons who are currently (and any additional persons who prior to the Effective Time become) covered by the Company’s directors’ and officers’ liability insurance policy on terms and scope with respect to such coverage, and in amount, not less favorable to such individuals than those of such policy in effect on the date hereof (or Parent may substitute therefor policies, issued by reputable insurers, of at least the same coverage required above with respect to matters occurring prior to the Effective Time); provided, however, that Parent shall not be obligated to make annual premium payments for such insurance to the extent such premiums exceed 300% of the annual premium paid as of the date hereof by the Company for such insurance (such 300% amount, the “Base Premium”); and provided further that, if the aggregate annual premiums for such insurance shall exceed the Base Premium, then Parent shall provide or cause to be provided a policy for the applicable individuals with the best coverage as shall then be available at an annual premium equal to the Base Premium. Prior to the Effective Time Parent or the Company may purchase, for an aggregate amount that shall not exceed the Base Premium, a six-year prepaid “tail policy” on terms and conditions providing at least materially equivalent benefits as the current policies of directors’ and officers’ liability insurance maintained by the Company and its Subsidiaries with respect to matters existing or occurring prior to the Effective Time, covering without limitation the transactions contemplated hereby. If such prepaid “tail policy” has been obtained by Parent or the Company, it shall be deemed to satisfy all obligations of the Parent to obtain insurance pursuant to this Section 5.04. The Surviving Corporation shall not amend, modify, cancel or revoke such policy and each shall use its reasonable best efforts to cause such policy to be maintained in full force and effect, for its full term, and to honor all of its obligations thereunder.

(c)          The provisions of this Section 5.04 are (i) intended to be for the benefit of, and shall be enforceable by, each Indemnitee, his or her heirs and his or her representatives, and (ii) in addition to, and not in substitution for, any other rights to indemnification or contribution that any such Person may have by contract or otherwise. The obligations of Parent and the Surviving Corporation under this Section 5.04 shall not be terminated or modified in such a manner as to adversely affect the rights of any Indemnitee to whom this Section 5.04 applies unless (A) such termination or modification is required by applicable Law, or (B) the affected Indemnitee shall have consented in writing to such termination or modification (it being expressly agreed that the Indemnitees to whom this Section 5.04 applies shall be third party beneficiaries of this Section 5.04).

(d)          In the event that Parent, the Surviving Corporation or any of their respective successors or assigns (i) consolidates with or merges into any other Person and is not the continuing or surviving corporation or entity of such consolidation or merger, or (ii) transfers or conveys all or substantially all of its properties and assets to any Person, then, and in each such case, proper provision shall be made so that the successors and assigns of Parent and the Surviving Corporation shall assume all of the obligations thereof set forth in this Section 5.04.

Section 5.05.       Fees and Expenses. All fees and expenses incurred in connection with this Agreement, the Transaction shall be paid by the party incurring such fees or expenses, whether or not the Transaction is consummated; provided, however, Parent shall pay all of the filing fees and expenses for the pre-merger notification and report forms under the HSR Act; provided, further, that the Company shall pay all of the fees and expenses in connection with the preparation of the Company’s pre-merger notification and report forms under the HSR Act, if any.

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Section 5.06.        Public Announcements.  The Company and Parent shall consult with each other before issuing any press release or otherwise making any public statements with respect to this Agreement or the Transaction and shall not issue any such press release or make any such public statement without the prior written consent of the other party, which consent shall not be unreasonably withheld, conditioned or delayed; provided, however, that (a) a party may, without the prior written consent of the other party, issue such press release or make such public statement as may be required by Law or the applicable rules of any stock exchange or quotation system if the party issuing such press release or making such public statement has used its reasonable best efforts to consult with the other party and to obtain such party’s consent but has been unable to do so in a timely manner, and (b) the Company may, without the prior written consent of Parent, and in compliance with any applicable notification provisions in Section 4.02, issue such press release or make such public statement release or announcement with respect to a Company Adverse Recommendation Change effected in accordance with Section 4.02(g). The parties agree that the initial press release to be issued with respect to the Transaction shall be in the form heretofore agreed to by the parties.

Section 5.07.        Notification of Certain Matters.  The Company shall give prompt notice to Parent, and Parent shall give prompt notice to the Company, of (a) any notice or other communication received by such party from any Governmental Entity in connection with this Agreement or the Transaction from any Person alleging that the consent of such Person is or may be required in connection with this Agreement or the Transaction, (b) any Proceedings commenced or, to such party’s knowledge, threatened against, relating to or involving or otherwise affecting such party or, in the case of the Company, a Company Subsidiary, and, in the case of Parent and Purchaser, any of their respective Subsidiaries, which relate to this Agreement or the Transaction, (c) and notice or correspondence received by the Company relating to the status of the IPOF Approvals and any other information concerning the IPOF Approvals and (d) any inaccuracy or breach of any representation or warranty or breach of covenant or agreement contained in this Agreement at any time during the term hereof that could reasonably be expected to cause the conditions set forth in Section 6.01 or any of the Offer Conditions, or in the event Approval is Required, Sections 6.01 or 6.02, not to be satisfied.

Section 5.08.        Employee Matters.

(a)          For a period of not less than twelve (12) months following the Effective Time, the employees of the Company who remain in the employment of the Surviving Corporation and its Subsidiaries at the Effective Time (the “Continuing Employees”) shall receive compensation and employee benefits (other than equity compensation plans or arrangements) that are substantially comparable in the aggregate to the employee benefits provided to the employees of the Company immediately prior to the Effective Time.

(b)         Parent shall cause the Surviving Corporation to recognize the service of each Continuing Employee as if such service had been performed with Parent for purposes of vesting, eligibility and benefit accruals in any benefit plan, program or policy covering that Continuing Employee following the Effective Time, but not for the purposes of benefit accruals that would result in duplication of benefits.

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(c)          Nothing contained herein shall be construed as requiring Parent or the Surviving Corporation to continue any specific plans or to continue the employment of any specific person; provided, however, that Surviving Corporation will, and Parent shall cause Surviving Corporation to, comply with terms and conditions of all employment, severance and other compensatory agreements or arrangements with any directors or employees of the Company that are in effect as of the date hereof, all of which are listed in Section 5.08(c) of the Company Disclosure Schedule.

(d)         With respect to any welfare plan maintained by Parent in which Continuing Employees are eligible to participate after the Effective Time, Parent shall, and shall cause the Surviving Corporation to, use commercially reasonable efforts to (i) waive all limitations as to preexisting conditions and exclusions with respect to participation and coverage requirements applicable to such employees to the extent such conditions and exclusions were satisfied or did not apply to such employees under the welfare plans of the Company and its Subsidiaries prior to the Effective Time and (ii) provide each Continuing Employee with credit for any co-payments and deductibles paid in the plan year in which the Effective Time occurs, but prior to the Effective Time in satisfying any analogous deductible or out-of-pocket requirements to the extent applicable under any such plan.

(e)          Nothing in this Section 5.08 will create any third-party beneficiary right for the benefit of any Person other than the parties to this Agreement, or any right to employment or continued employment or to a particular term or condition of employment with Parent, the Surviving Corporation or any of their respective Subsidiaries or Affiliates. Nothing in this Section 5.08 or any other provision of this Agreement (i) will be construed to establish, amend, or modify any benefit or compensation plan, program, agreement or arrangement, or (ii) will limit the ability of Parent or any of its Affiliates (including, following the Closing, the Surviving Corporation or any of the Company Subsidiaries) to amend, modify or terminate any benefit or compensation plan, program, agreement or arrangement at any time assumed, established, sponsored or maintained by any of them.

Section 5.09.        Financing.

(a)          From and after the date of this Agreement, the Company shall, and shall cause its Agents and each Company Subsidiary and its Agents to, use reasonable best efforts to provide all cooperation reasonably requested by Parent in connection with the arrangement of the debt financing contemplated by the Debt Commitment Letters or any replacement debt commitment letters (the “Debt Financing”), including:

(i)          furnishing Parent as promptly as reasonably practicable with (A) the audited consolidated financial statements of the Company and the Company Subsidiaries no later than 90 days following the end of each fiscal year, (B) the unaudited consolidated financial statements of the Company and the Company Subsidiaries no later than 45 days following the end of each fiscal quarter, (C) the monthly consolidated financial statements of the Company and the Company Subsidiaries no later than 15 days following the end of each calendar month and (D) all other financial information and other pertinent information regarding the Company and the Company Subsidiaries as may be reasonably requested by Parent to consummate the Debt Financing as is customary to be included in marketing materials for senior secured term or revolving credit facility indebtedness;

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(ii)         participating, at Parent’s sole cost, in a reasonable number of meetings, presentations, road shows, due diligence sessions, drafting sessions, meetings with prospective lenders and sessions with ratings agencies in connection with the Debt Financing and assisting with the preparation of customary confidential information memoranda, bank information memoranda and other materials and other documentation to be used in such meetings, presentations, road shows or sessions or otherwise used in the syndication of any credit facilities;

(iii)        cooperating reasonably with the due diligence efforts of prospective lenders, including (A) providing one or more third-party diligence service providers with reasonable access to the Company and the Company Subsidiaries and (B) furnishing Parent and the prospective lenders with current data on the credit and other characteristics of the Company and the Company Subsidiaries; and

(iv)        at Parent’s sole cost, assisting reasonably in the preparation of, and executing and delivering, one or more credit or other agreements, as well as any pledge and security documents and other definitive financing documents, collateral filings or other certificates or documents as may be reasonably requested by Parent and otherwise reasonably facilitating the pledging of collateral.

(b)         Nothing in this Section 5.09 shall affect the obligation of the Guarantor under the Equity Commitment Letter to provide the full amount of the Equity Financing to Parent, subject to the terms and conditions of the Equity Commitment Letter, at Closing if all or any portion of the Debt Financing is unavailable at Closing.

Section 5.10.       State Takeover Laws. If any “control share acquisition,” “fair price,” “moratorium” or other anti-takeover applicable Law becomes or is deemed to be applicable to the Company, Parent, Purchaser or the Transaction, then each of the Company, Parent, Purchaser, and their respective Boards of Directors shall grant such approvals and take such actions as are necessary so that the Transaction may be consummated as promptly as practicable on the terms contemplated hereby and otherwise act to render such anti-takeover applicable Law inapplicable to the foregoing.

Section 5.11.       Director Resignations. Prior to the Closing, other than with respect to any directors identified by Parent in writing to the Company two (2) days prior to the Closing Date, the Company shall deliver to Parent resignations executed by each director of the Company in office immediately prior to the Effective Time, which resignations shall be effective at the Effective Time.

Section 5.12.       Section 16 Matters. Prior to the Effective Time, the Company may approve, in accordance with the procedures set forth in Rule 16b-3 promulgated under the Exchange Act and in accordance with the Interpretative Letter dated January 12, 1999 issued by the SEC relating to Rule 16b-3, any dispositions of equity securities of the Company (including derivative securities with respect to equity securities of the Company) resulting from the Transaction by each officer or director of the Company who is subject to Section 16 of the Exchange Act with respect to equity securities of the Company.

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Section 5.13.       Company SEC Documents.  Without limiting the terms of Section 5.01, from and after the date of this Agreement, the Company shall timely file with or furnish to the SEC all Company SEC Documents required to be so filed or furnished under the Securities Act or the Exchange Act and the Company shall take reasonable efforts consistent with past practices to ensure none of the information contained therein will contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading.

Section 5.14.       Shareholder Litigation.  Notwithstanding anything in Section 4.01(i) to the contrary, the Company shall give Parent the opportunity to participate in the defense and settlement of any shareholder litigation against the Company and/or its directors relating to this Agreement and the Transaction and no such settlement shall be agreed to without Parent’s prior written consent, which consent shall not be unreasonably withheld.

Section 5.15.       Rule 14d-10 Matters.  Prior to the expiration of the Offer, the Company will take all such steps as may be required to cause to be exempt under Rule 14d-10(d) promulgated under the Exchange Act any employment compensation, severance or employee benefit arrangements that have been or will be entered into after the date of this Agreement by the Company or any Company Subsidiary with current or future directors, officers or employees of the Company or any Company Subsidiary (including the Employment Agreements and the Aircraft Lease) and to ensure that any such arrangements fall within the non-exclusive safe harbor provisions of such rule.

ARTICLE VI.
CONDITIONS PRECEDENT

Section 6.01.        Conditions to Each Party’s Obligation to Effect the Transaction.  The respective obligation of each party to effect the Transaction is subject to the satisfaction or (to the extent permitted by Law) waiver on or prior to the Closing Date of the following conditions:

(a)          Shareholder Approval. If Approval is Required, the Shareholder Approval shall have been obtained.

(b)          Antitrust.  The waiting period (and any extension thereof) applicable to the Merger under the HSR Act and any other applicable Antitrust Laws shall have been terminated or shall have expired, and any required approvals thereunder shall have been obtained.

(c)          No Injunctions or Restraints.  No Law or Order enacted, promulgated, issued, entered, amended or enforced by any Governmental Entity (collectively, “Restraints”) shall be in effect enjoining, restraining, preventing or prohibiting consummation of the Transaction or making the consummation of the Transaction illegal.

(d)          Consummation of the Offer.  Unless Approval is Required, the Offer Closing shall have occurred.

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Section 6.02.       Conditions to Obligations of Parent and Purchaser.  In the event Approval is Required, the obligations of Parent and Purchaser to effect the Transaction are further subject to the satisfaction or (to the extent permitted by law) waiver by Parent on or prior to the Closing Date of the following conditions:

(a)          Representations and Warranties.  (i) The representations and warranties of the Company contained in Sections 3.01(b)(i)-(v), 3.01(c)(i), 3.01(f)(ii), 3.01(p), 3.01(q) and 3.01(s) shall be true and correct in all respects at and as of the date of this Agreement and at and as of the Closing Date as though made at and as of the Closing Date and (ii) all other representations and warranties of the Company shall be true and correct in all respects (disregarding any “material”, “Material Adverse Effect” or “Material Adverse Change” qualifiers contained therein) as of the date of this Agreement and at and as of the Closing Date as though made at and as of the Closing Date, except where the failure of such representations or warranties described in this clause (ii) to be so true and correct would not have a Material Adverse Effect; provided in each case that representations and warranties made as of a specific date shall be required to be so true and correct (subject, in the case of the representations and warranties described in this clause (ii), to such qualifications) as of such date only.

(b)          Performance of Obligations of the Company.  The Company shall have performed in all material respects all obligations required to be performed by it under this Agreement at or prior to the Closing Date.

(c)          Certificates.  The Company shall have delivered to Parent a certificate, dated as of the Closing Date and signed by its Chief Executive Officer, certifying to the effect that the conditions set forth in Sections 6.02(a) and (b) have been satisfied.

(d)          No Material Adverse Effect.  Since the date of this Agreement there shall not have been any Material Adverse Effect.

(e)          IPOF Approvals.  The Company shall deliver to Parent on or prior to the Closing Date evidence of the approval of (i) the special receiver for the IPOF Fund, L.P. assets (“IPOF Receiver”), appointed by the United States District Court for the Northern District of Ohio, authorizing the sale of the Common Stock held by the IPOF Receiver and (ii) the United States District for the Northern District of Ohio for the sale of the Common Stock held by the IPOF Receiver in trust (collectively, the “IPOF Approvals”).

(f)          Dissenting Shares.  The number of Dissenting Shares for which demands for appraisal have been made and not withdrawn shall not exceed 5% of the number of shares of Common Stock outstanding as of the date of this Agreement.

(g)          FIRPTA Certificate.  The Company shall have delivered to Parent a duly executed affidavit, in form and substance reasonably acceptable to the Buyer, dated as of the Closing Date and in compliance with Section 1445 of the Code and the Treasury regulations promulgated thereunder, stating that the Company is not a “United States real property holding corporation” within the meaning of the Code.

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Section 6.03.        Conditions to Obligations of the Company  In the event Approval is Required, the obligation of the Company to effect the Merger is further subject to the satisfaction or (to the extent permitted by law) waiver by the Company on or prior to the Closing Date of the following conditions:

(a)          Representations and Warranties.  (i) The representations and warranties of Parent and Purchaser contained in Sections 3.02(b)(i) and 3.02(h) shall be true and correct in all respects at and as of the date of this Agreement and at and as of the Closing Date as though made at and as of the Closing Date and (ii) all other representations and warranties of Parent and Purchaser shall be true and correct in all respects (disregarding any “material” or “Parent Material Adverse Effect” qualifiers contained therein) as of the date of this Agreement and at and as of the Closing Date as though made at and as of the Closing Date, except where the failure of such representations or warranties described in this clause (ii) to be so true and correct would not have a Parent Material Adverse Effect.

(b)          Performance of Obligations of Parent and Purchaser. Parent and Purchaser shall have performed in all material respects all obligations required to be performed by them under this Agreement at or prior to the Closing Date, and the Company shall have received a certificate signed on behalf of Parent by an executive officer of Parent to such effect.

(c)          Certificates. Parent shall have delivered to the Company a certificate, dated as of the Closing Date and signed by a duly authorized officer of Parent, certifying to the effect that the conditions set forth in Sections 6.03(a) and (b) have been satisfied.

Section 6.04.        Frustration of Closing Conditions  None of the Company, Parent or Purchaser may rely on the failure of any condition set forth in Section 6.01, Section 6.02, Section 6.03 or Annex I as the case may be, to be satisfied if such failure was caused by such party’s failure to use the standard of efforts required from such party to consummate the Transaction, as required by and subject to Section 5.03.

ARTICLE VII.
TERMINATION, AMENDMENT AND WAIVER

Section 7.01.        Termination. This Agreement may be terminated, and the Transaction abandoned, at any time prior to the Effective Time (except as otherwise provided below):

(a)          by the mutual written consent of Parent and the Company;

(b)          by either Parent or the Company upon written notice to the other party, if:

(i)          the Transaction shall not have been consummated on or before May 14, 2014 (the “Offer End Date”); provided, however, that, in the event Approval is Required, the Offer End Date shall automatically be extended to September 14, 2014 (the “Extended End Date”); provided further that the right to terminate this Agreement under this Section 7.01(b)(i) shall not be available to any party whose willful and material breach of a representation, warranty or covenant in this Agreement has been a proximate cause of the failure of the Transaction to be consummated on or before the Offer End Date or, if Approval is Required, the Extended End Date;

(ii)         any Restraint having any of the effects set forth in Section 6.01(b) shall be in effect and shall have become final and nonappealable; or

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(iii)        the Shareholder Approval shall not have been obtained at the Shareholders’ Meeting duly convened therefor or at any permitted adjournment or postponement thereof; provided, however, that the right to terminate this Agreement under this Section 7.01(b)(iii) shall not be available to the Company where the failure to obtain the Shareholder Approval is caused by any material breach of Section 4.02.

(c)          by Parent upon written notice to the Company, if:

(i)          the Company shall have breached or failed to perform any of its representations, warranties, covenants or agreements set forth in this Agreement, which breach or failure to perform (A) would give rise to the failure of a condition set forth in Section 6.01 or any of the Offer Conditions, or in the event Approval is Required, Sections 6.01 or 6.02 and (B) is incapable of being cured, or is not cured, by the Company on or prior to the earlier to occur of (1) the Offer End Date or, if Approval is Required, the Extended End Date, or (2) the 20^th calendar day following receipt of written notice of such breach or failure to perform from Parent; provided, that Parent shall not have the right to terminate this Agreement pursuant to this Section 7.01(c)(i) if Parent or Purchaser is then in breach of any representation, warranty, covenant or agreement hereunder that would result in the closing conditions set forth in Section 6.01, or in the event Approval is Required, Sections 6.01 or 6.03, not being satisfied;

(ii)         the Board shall have effected a Company Adverse Recommendation Change; or

(iii)        (A) the Company shall have entered into, or publicly announced its intention to enter into, or publicly recommended, an Acquisition Agreement in respect of a Takeover Proposal or a Superior Proposal; or (B) the Company shall have breached in any material respect Section 4.02.

(d)          by the Company, if:

(i)          Parent or Purchaser shall have breached or failed to perform any of its representations, warranties, covenants or agreements set forth in this Agreement, which breach or failure to perform (A) would give rise to the failure of a condition set forth in Section 6.01, or in the event Approval is Required, Sections 6.01 or 6.03, and (B) is incapable of being cured, or is not cured, by Parent and Purchaser on or prior to the earlier to occur of (1) the Offer End Date or, if Approval is Required, the Extended End Date, or (2) the 20^th calendar day following receipt of written notice of such breach or failure to perform from the Company; provided, that the Company shall not have the right to terminate this Agreement pursuant to this Section 7.01(d)(i) if the Company is then in breach of any representation, warranty, covenant or agreement hereunder that would result in the closing conditions set forth in Section 6.01 or any of the Offer Conditions, or in the event Approval is Required, Sections 6.01 or 6.02, not being satisfied; or

(ii)         prior to the Offer Closing, or in the event Approval is Required, prior to the receipt of Shareholder Approval, the Board authorizes the Company, in compliance with the terms of this Agreement, to enter into an Acquisition Agreement in respect of a Superior Proposal; provided, however, that (A) the Company has complied in all material respects with Section 4.02 and (B) the Company shall pay any amounts due pursuant to Section 7.02(b) in accordance with the terms, and at the times, specified in Section 7.02; and provided further that in the event of such termination, the Company concurrently with such termination enters into such Acquisition Agreement.

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Section 7.02.        Termination Fee; Expenses.

(a)          In the event that (i) after the date of this Agreement and prior to the Offer Closing, or in the event Approval is Required, prior to obtaining Shareholder Approval, a Takeover Proposal shall have been made to the Company or shall have been made directly to the shareholders of the Company generally, and (ii) thereafter this Agreement is terminated by Parent or the Company pursuant to Section 7.01(b)(i) or Section 7.01(b)(iii) or by Parent pursuant to Section 7.01(c)(i), and (iii) within nine (9) months after such termination, the Company (A) consummates a transaction that constitutes a Takeover Proposal or (B) enters into an Acquisition Agreement with respect to any Takeover Proposal and such Takeover Proposal is consummated within twelve (12) months after such termination, then the Company shall pay Parent a fee equal to $4,344,505 (the “Termination Fee”) (reduced dollar-for-dollar by the amount of any Parent Expenses that may have been previously paid pursuant to Section 7.02(d) or Section 7.02(e)) by wire transfer of same-day funds concurrently with the execution of the Acquisition Agreement or the consummation of such transaction, whichever occurs first. For purposes of this Section 7.02(a), references to “20%” in the definition of Takeover Proposal shall be deemed to be references to “50%”.

(b)         In the event that this Agreement is terminated by Parent pursuant to Section 7.01(c)(ii) or Section 7.01(c)(iii), then the Company shall pay Parent the Termination Fee by wire transfer of same-day funds no later than the second Business Day following such termination.

(c)          In the event that this Agreement is terminated by the Company pursuant to Section 7.01(d)(ii), then the Company shall pay Parent the Termination Fee by wire transfer of same-day funds concurrently with, and as a condition to the effectiveness of, such termination.

(d)          In the event that this Agreement is terminated by Parent or the Company pursuant to Section 7.01(b)(i) or Section 7.01(b)(iii), except to the extent such termination is the result of Parent or Purchaser’s breach, the Company shall reimburse Parent for all reasonable documented out-of-pocket fees and expenses (including all fees and expenses of counsel, accountants, financing sources (including commitment fees), experts and consultants) incurred by Parent, Purchaser or their respective Affiliates in connection with this Agreement or the Transaction not to exceed $1,500,000 in the aggregate (such expenses subject to such limit, the “Parent Expenses”) by wire transfer of same-day funds no later than the second Business Day following such termination.

(e)          In the event that this Agreement is terminated by Parent pursuant to Section 7.01(c)(i), the Company shall reimburse Parent for the Parent Expenses by wire transfer of same-day funds no later than the second Business Day following such termination.

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(f)          The parties acknowledge and agree that the provisions for payment of the Termination Fee and the Parent Expenses are an integral part of the Transaction and are included herein in order to induce Parent to enter into this Agreement and to reimburse Parent for incurring the costs and expenses related to entering into this Agreement and consummating the Transaction. If the Company fails to pay the Termination Fee or Parent Expenses and Parent or Purchaser commences a suit which results in a final, non-appealable judgment against the Company for the Termination Fee or the Parent Expenses, or any portion thereof, then the Company shall pay Parent and Purchaser their costs and expenses (including reasonable attorney’s fees and disbursements) in connection with such suit, together with interest on the Termination Fee at the prime rate (as published in The Wall Street Journal) in effect on the date such payment was required to be made through the date of payment; provided that if the court in such suit determines in a final, non-appealable judgment that Parent or Purchaser is not entitled to the Termination Fee or the Parent Expenses, or any portion thereof, then Parent shall pay the Company its costs and expenses (including reasonable attorney’s fees and disbursements) in connection with such suit.

(g)          The parties acknowledge that in no event shall the Company be required to pay an aggregate amount in excess of $4,344,505 whether or not the Termination Fee or Parent Expenses may be payable under more than one provision of this Agreement, and in no event shall the Company be required to pay the Parent Expenses more than once.

Section 7.03.        Effect of Termination.

(a)          In the event of the termination of this Agreement by either the Company or Parent as provided in Section 7.01, this Agreement shall forthwith become void and have no effect, without any liability or obligation on the part of Parent, Purchaser or the Company and their respective directors, officers, employees, partners, members or shareholders; provided, however, that (i) the agreements contained in Section 5.02(b), Section 5.05, Section 7.02, Section 7.03 and ARTICLE VIII shall survive the termination of this Agreement, and (ii) none of Parent, Purchaser or the Company shall be relieved from liabilities or damages (which the parties acknowledge and agree shall not be limited to reimbursement of expenses or out-of-pocket costs, and that nothing in this Agreement shall prohibit either party from seeking to prove that such damages include the benefit of the bargain lost by such party or such party’s shareholders) arising out of the willful and material breach by such party of any of its representations, warranties, covenants or other agreements contained in this Agreement, subject to Sections 7.03(b) and 8.12(c); provided, further, that the failure of Parent and Purchaser to consummate the Transaction after all conditions in Section 6.01 and the Offer Conditions have been satisfied, or in the event Approval is Required, after all conditions in Sections 6.01 and 6.02 have been satisfied, or, to the extent permitted, waived (other than those conditions that by their terms are to be satisfied upon Closing), shall be deemed a willful and material breach by Parent and Purchaser of this Agreement.

(b)          The parties agree that the payment of the Termination Fee and the Parent Expenses shall be the sole and exclusive remedy available to Parent and Purchaser with respect to this Agreement and the Transaction in the event any payment of the Termination Fee or the Parent Expenses become due and payable under the terms of this Agreement, and, upon payment of the Termination Fee and/or the Parent Expenses the Company shall have no further liability to Parent and Purchaser hereunder. The parties agree that, except in the event of fraud, the payment of the Termination Fee and/or the Parent Expenses in the circumstances in which the Termination Fee and/or the Parent Expenses become payable, constitutes liquidated damages and is not a penalty, but rather a reasonable amount that will compensate the Parent and Purchaser for the efforts and resources expended and opportunities foregone while negotiating this Agreement and in reliance on this Agreement and on the expectation of the consummation of the Transaction.

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ARTICLE VIII.
GENERAL PROVISIONS

Section 8.01.        Nonsurvival of Representations and Warranties.  None of the representations and warranties in this Agreement or in any instrument delivered pursuant to this Agreement shall survive the Effective Time. This Section 8.01 shall not limit any covenant or agreement of the parties which by its terms contemplates performance after the Effective Time.

Section 8.02.        Notices. All notices, requests, claims, demands and other communications hereunder shall be in writing and shall be deemed given if delivered personally, sent by facsimile (providing confirmation of transmission) or sent by prepaid overnight courier (providing proof of delivery) to the parties at the following addresses or facsimile numbers (or at such other address or facsimile number for a party as shall be specified by like notice):

if to Parent or Purchaser, to:

c/o Sterling Fund Management, LLC

401 North Michigan Avenue, Suite 3300

Chicago, Illinois 60611

Telecopy No.: (312) 465-7001

Attention: Office of General Counsel

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

Katten Muchin Rosenman LLP

525 West Monroe Street

Chicago, Illinois 60661

Telecopy No.: (312) 577-8870

Attention: Saul Rudo, Esq. and Jeffrey R. Patt, Esq.

if to the Company, to:

Innotrac Corporation

6465 East Johns Crossing

Johns Creek, Georgia 30097

Telecopy No.: (678) 584-8949

Attention: Scott D. Dorfman

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

Kilpatrick Townsend & Stockton LLP

1100 Peachtree Street NE, Suite 2800

Atlanta, Georgia 30309

Telecopy No.: (404) 541-3402

Attention: David A. Stockton, Esq.

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Section 8.03.        Definitions.  For purposes of this Agreement:

(a)          “Affiliate” means, as to any Person (i) any other Person that, directly or indirectly, through one or more intermediaries, controls, or is controlled by, or is under common control with, such Person. For this purpose, “control” (including, with its correlative meanings, “controlled by” and “under common control with”) shall mean the possession, directly or indirectly, of the power to direct or cause the direction of management or policies of a Person, whether through the ownership of securities or partnership or other ownership interests, by contract or otherwise and (ii) with respect to any natural Person, any member of the immediate family of such natural Person;

(b)          “Business Day” means any day other than a Saturday, Sunday or any other day on which the banks in Chicago, Illinois or Atlanta, Georgia are required or authorized by Law to be closed;

(c)          “Company Lease” shall mean any lease, sublease, sub-sublease, license and other agreement under which the Company leases, subleases, licenses, uses or occupies (in each case whether as landlord, tenant, sublandlord, subtenant or by other occupancy arrangement), or has the right to use or occupy, now or in the future, any real property;

(d)          “Company Subsidiary” means a Subsidiary of the Company;

(e)          “Debt Commitment Letter” means that certain Commitment Letter, dated as of the date hereof, from the Debt Financing Sources;

(f)          “Debt Financing” means the debt financing commitments made pursuant to the Debt Commitment Letter;

(g)          “Debt Financing Sources” means the Persons that have committed to provide or otherwise entered into agreements in connection with the Debt Financing, including any joinder agreements, indentures or credit agreements entered into pursuant thereto or relating thereto, together with any Debt Financing Sources Relates Parties involved in the Debt Financing, and their successors and assigns;

(h)          “Debt Financing Sources Related Parties” means the Debt Financing Sources and any former, current and future Affiliates, officers, directors, managers, employees, shareholders, equityholders, members, managers, partners, agents, representatives, successors or assigns of any of the foregoing;

(i)          “Dissenting Shares” means shares of Common Stock owned of record by any shareholder who has demanded appraisal of such Common Stock shares in accordance with and as contemplated by Section 14-2-1302, et seq. of the GBCC and, as of the Effective Time, has neither effectively waived, withdrawn or lost such right to appraisal nor failed to perfect such right to appraisal;

(j)          “ERISA” means the Employee Retirement Income Security Act of 1974, as amended, and the regulations promulgated thereunder;

(k)          “Equity Financing” means the cash amount sent forth in the Equity Commitment Letter committed by Guarantor to Parent;

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(l)          “Excluded Shares” means, collectively, the Dissenting Shares and the shares of Common Stock described in Sections 2.01(a)(i) and 2.01(a)(ii);

(m)          “Guarantor” means Sterling Capital Partners IV, L.P.;

(n)          “Hazardous Materials” means any “hazardous waste” as defined in either the Resource Conservation and Recovery Act or regulations adopted pursuant to said act, any “hazardous substances” or “pollutant” or “contaminant” as defined in the Comprehensive Environmental Response, Compensation and Liability Act or regulations adopted pursuant to said act and, to the extent not included in the foregoing, any petroleum or fractions thereof, petroleum products, asbestos, asbestos-containing materials, polychlorinated biphenyls, or toxic mold, mildew or fungi;

(o)          “Indebtedness” means (A) any indebtedness for borrowed money (including the issuance of any debt security) to any Person, (B) any obligations evidenced by notes, bonds, debentures or similar Contracts (as defined below) to any Person, (C) any capital lease obligations properly categorized as such under GAAP to any Person, (D) any obligations in respect of letters of credit and bankers’ acceptances, or (E) any guaranty of any such obligations described in clauses (A) through (D) of any Person other than the Company or any of its Subsidiaries, in each case, together with all interest, fees and penalties relating to any of the foregoing. For the avoidance of doubt, the term “Indebtedness” shall not include accounts payable to trade creditors and accrued expenses, in each case arising in the ordinary course of business.

(p)          “Knowledge of the Company”, the “Company’s Knowledge” or references to the Company’s “awareness” or similar references means, with respect to any matter in question, the actual knowledge of Scott D. Dorfman, Larry Hanger, Steve Keaveney, Ed Ringer and Robert Toner and what each individual would have known (i) upon reasonable inquiry of the persons reporting directly to such individual and (i) after reasonable review of reports and documents in their actual possession;

(q)          “Laws” means all statutes, laws, ordinances, rules, regulations, judgments and Orders of any Governmental Entity;

(r)          “Leased Real Property” means all interests in real property pursuant to the Company Leases;

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(s)          “Material Adverse Change” or “Material Adverse Effect” means, any condition, circumstance, change, event or occurrence, that, individually or in the aggregate, (i) has had or would reasonably be expected to have, a material adverse effect on the assets, business, results of operations or condition (financial or otherwise) of the Company and the Company Subsidiaries taken as a whole, or (ii) would reasonably be expected to prevent, materially delay or materially impair the Company’s ability to consummate the Transaction, other than, in each case, conditions, circumstances, changes, events, occurrences or effects (A) generally affecting (I) the industry in which the Company and the Company Subsidiaries operate, provided that such changes, events, occurrences or effects do not affect the Company and the Company Subsidiaries, in a materially disproportionate manner as compared to other participants in such industry (the “Industry”), or (II) the economy, credit or financial or capital markets, in the United States or elsewhere in the world, including changes in interest or exchange rates, provided that such changes, events, occurrences or effects do not affect the Company and the Company Subsidiaries in a materially disproportionate manner as compared to other participants in the Industry, or (B) arising out of, resulting from or attributable to (I) changes in Law or in generally accepted accounting principles or in accounting standards, or changes in general legal, regulatory or political conditions, provided that such changes, events, occurrences or effects do not affect the Company and its Subsidiaries in a materially disproportionate manner as compared to other participants in the Industry, (II) any litigation arising from allegations of breach of fiduciary duty relating to this Agreement or the Transaction brought by a holder or holders of Common Stock, (III) acts of war, sabotage, hostilities or terrorism, or any escalation or worsening of any such acts of war, sabotage, hostilities or terrorism threatened or underway as of the date of this Agreement that do not affect the Company and the Company Subsidiaries in a materially disproportionate manner as compared to other participants in the Industry, (III) earthquakes, hurricanes, tornados or other natural disasters that do not affect the Company and the Company Subsidiaries in a materially disproportionate manner as compared to other participants in the Industry, (IV) any action taken, or omissions, by the Company or any Company Subsidiary that is specifically required by this Agreement or is taken or omitted with Parent’s written consent or at Parent’s written request, (V) any decline in the market price, or change in trading volume, of the capital stock of the Company (it being understood that the facts or occurrences giving rise or contributing to such decline or change that are not otherwise excluded from the definition of a “Material Adverse Effect” may be deemed to constitute, or be taken into account in determining whether there has been, is, or would be a Material Adverse Effect on the Company) or (VI) any failure to meet any internal or public projections, forecasts or estimates of revenue or earnings in and of itself (it being understood that the facts or occurrences giving rise or contributing to such failure that are not otherwise excluded from the definition of a “Material Adverse Effect” may be deemed to constitute, or be taken into account in determining whether there has been, is, or would be a Material Adverse Effect on the Company);

(t)          “Nasdaq” means the Nasdaq Capital Market;

(u)          “Non-Waivable Conditions” means the Offer Conditions set forth in clauses (a), (b) and (c) of Annex III;

(v)         “Organizational Documents” means (i) in the case of any Person organized as a corporation, the certificate or articles of incorporation of such corporation (or, if applicable, the memorandum and articles of association of such corporation) and the bylaws of such corporation, (ii) in the case of any Person organized as a limited liability company, the certificate of formation or organization and the limited liability company agreement or operating agreement of such limited liability company, (iii) in the case of any Person organized as a limited partnership, the certificate of limited partnership and limited partnership agreement of such limited partnership, (iv) in the case of any other Person, all constitutive or organizational documents of such Person which address matters relating to the business and affairs of such Person similar to the matters addressed by the documents referred to in clauses (i) through (iii) above in the case of Persons organized as corporations, limited liability companies or limited partnerships and (v) any amendment to any of the foregoing;

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(w)          “Parent Material Adverse Effect” means any condition, circumstance, change, event or occurrence that, individually or in the aggregate, would reasonably be expected to prevent, materially delay or materially impair the Parent’s or Purchaser’s ability to consummate the Transaction;

(x)          “Permits” means all approvals, accreditations, authorizations, certificates, filings, franchises, licenses, notices and permits of or with all Governmental Entities;

(y)          “Permitted Liens” means (i) Liens specifically identified on the Balance Sheet or in the notes thereto; (ii) Liens for taxes, assessments or other governmental charges and levies not yet due and payable or that are being contested in good faith and by appropriate proceedings if adequate reserves with respect thereto are reflected on Balance Sheet in accordance with GAAP; (iii) immaterial Liens that, individually or in the aggregate with all other Permitted Liens, do not and will not materially interfere with the use or value of the properties or assets of the Company and its Subsidiaries taken as a whole as currently used; (iv) statutory Liens of landlords and Liens of carriers, warehousemen, mechanics, materialmen, and other similar Liens imposed by applicable law incurred in the ordinary course of business for sums not yet delinquent or being contested in good faith; and (v) Liens relating to deposits made in the ordinary course of business in connection with workers’ compensation, unemployment insurance, and other types of social security;

(z)          “Person” means any natural person, individual, firm, corporation, company, partnership, limited liability company, joint venture, association, business trust, trust, unincorporated organization, Governmental Entity or other entity;

(aa)         “Proceeding” means any action, suit, claim, arbitration, audit, assessment, hearing, investigation, litigation or suit by or before any Governmental Entity or arbitrator;

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

Section 8.04.         Interpretation.  When a reference is made in this Agreement to an Article, a Section or Exhibit, such reference shall be to an Article of, a Section of, or an Exhibit to, this Agreement unless otherwise indicated. The table of contents and headings contained in this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement. Whenever the words “include”, “includes” or “including” are used in this Agreement, they shall be deemed to be followed by the words “without limitation”. The words “hereof”, “herein” and “hereunder” and words of similar import when used in this Agreement shall refer to this Agreement as a whole and not to any particular provision of this Agreement. All terms defined in this Agreement shall have the defined meanings when used in any certificate or other document made or delivered pursuant hereto unless otherwise defined therein. The definitions contained in this Agreement are applicable to the singular as well as the plural forms of such terms and to the masculine as well as to the feminine and neuter genders of such term. Any Contract or statute defined or referred to herein or in any Contract that is referred to herein means such Contract or statute as from time to time amended, modified or supplemented, including (in the case of Contracts) by waiver or consent and (in the case of statutes) by succession of comparable successor statutes and references to all attachments thereto and instruments incorporated therein. References to a Person are also to its permitted successors and assigns. Each party and its counsel have reviewed the terms and provisions of this Agreement and have contributed to its drafting. The rules of construction providing that any ambiguities are resolved against the drafting party shall not be employed in the interpretation of this Agreement. The terms and provisions of this Agreement shall be construed fairly as to all parties hereto and not in favor of or against any party, regardless of which party was generally responsible for the preparation of this Agreement.

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Section 8.05.       Amendments.  This Agreement may be amended by the parties hereto by action taken by or on behalf of their respective boards of directors or similar governing bodies at any time prior to the Effective Time; provided, however, that after the approval of this Agreement by the shareholders of the Company, no amendment may be made which under applicable Law requires the approval of the shareholders of the Company without such further approval. This Agreement may not be amended except by an instrument in writing signed by the parties hereto.

Section 8.06.       Waiver.  At any time prior to the Effective Time, any party hereto may (a) extend the time for the performance of any of the obligations or other acts of the other parties hereto, (b) waive any inaccuracies in the representations and warranties of the other parties contained herein or in any document, certificate or writing delivered pursuant hereto by the other parties, and (c) subject to the requirements of applicable Law, waive compliance with any of the agreements or conditions for the benefit of such party contained herein. Any such extension or waiver shall be valid if set forth in an instrument in writing signed by the party or parties granting the waiver or extension. Neither the waiver by any of the parties hereto of a breach of or a default under any of the provisions of this Agreement, nor the failure by any of the parties, on one or more occasions, to enforce any of the provisions of this Agreement or to exercise any right or privilege hereunder, may be construed as a waiver of any other breach or default, or as a waiver of any future breaches of, defaults under or rights to exercise such provisions, rights or privileges hereunder.

Section 8.07.       Consents and Approvals.  For any matter under this Agreement requiring the consent or approval of any party to be valid and binding on the parties hereto, such consent or approval must be in writing.

Section 8.08.        Counterparts; Effectiveness.  This Agreement may be executed in two or more counterparts, each of which shall be deemed to be an original but all of which shall constitute one and the same agreement. This Agreement shall become effective when each party hereto shall have received counterparts thereof signed and delivered (by facsimile or other electronic means) by the other party hereto.

Section 8.09.       Entire Agreement; No Third-Party Beneficiaries.  This Agreement, the Company Disclosure Schedule and the Confidentiality Agreement (a) constitute the entire agreement, and supersede all prior agreements and understandings, both written and oral, among the parties and their Affiliates with respect to the subject matter of this Agreement, the Company Disclosure Schedule and the Confidentiality Agreement and shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns, and (b) except for the provisions of (i) ARTICLE II, (ii) Section 5.04, and (iii) Sections 8.09, 8.12(b), 8.12(d) and 8.13 (which shall be for the benefit of the Debt Financing Sources and the Debt Financing Sources Related Parties, which will have the rights provided for therein) are not intended to and do not confer upon any Person other than the parties hereto any legal or equitable rights or remedies hereunder.

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Section 8.10.       GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF GEORGIA, REGARDLESS OF THE LAWS THAT MIGHT OTHERWISE GOVERN UNDER APPLICABLE PRINCIPLES OF CONFLICTS OF LAWS THEREOF.

Section 8.11.        Assignment.  Neither this Agreement nor any of the rights, interests or obligations hereunder shall be assigned, in whole or in part, by operation of law or otherwise, by any of the parties without the prior written consent of the other parties, and any assignment without such consent shall be null and void; provided, however, that nothing in this Agreement shall, or is intended to limit, the ability of Parent and Purchaser to assign their rights or delegate their responsibilities, liabilities and obligations under this Agreement, in whole or in part, without the consent of the other parties hereto to (a) any Affiliate of Parent or Purchaser, (b) any purchaser of all or substantially all of the assets or capital stock of Parent or any Subsidiary thereof or (c) lenders to Parent, the Surviving Corporation or any of their Subsidiaries as security for borrowings, at any time whether prior to or following the Closing Date, provided that (x) such assignment shall not relieve Parent or Purchaser of its obligations hereunder or the Guarantor of its obligations under the Equity Commitment Letter and (y) the assignee shall expressly assume, by instruments acceptable to the Company, the obligations of Parent and Purchaser hereunder.

Section 8.12.        Specific Enforcement; Consent to Jurisdiction.

(a)          The parties hereto agree that irreparable damage would occur in the event that any of the provisions of this Agreement were not performed in accordance with their specific terms or were otherwise breached, and that money damages or other legal remedies would not be an adequate remedy for any such damages. It is accordingly agreed that (i) prior to the valid termination of this Agreement in accordance with Section 7.01 (i) the parties shall be entitled to seek (in a court of competent jurisdiction as set forth in Section 8.12(c)) an injunction or injunctions to prevent breaches of this Agreement and to enforce specifically the terms and provisions of this Agreement, without bond or other security being required, this being in addition to any remedy to which they are entitled pursuant to Section 7.02 and/or Section 7.03, but subject in all cases to Section 8.12(b), (c) and (d) below, and (ii) the right of specific performance is an integral part of the Transaction and without the right, neither the Company nor Parent nor Purchaser would have entered into this Agreement. Notwithstanding anything to the contrary herein, it is explicitly agreed that the Company shall be entitled to an injunction, specific performance or other equitable remedy to specifically enforce the Parent’s and Purchaser’s obligations to consummate the Offer and the Merger and cause the Equity Financing to be funded to fund the Transaction on the terms and conditions set forth herein (as opposed to an injunction, specific performance or other equitable remedy to force Parent and Purchaser to comply with their other obligations set forth herein (other than Parent’s and/or Purchaser’s obligations to effect the Closing), which shall be governed by the preceding sentence), but only in the event that (i) all conditions set forth in Section 6.01 and the Offer Conditions, or in the event Approval is Required, Sections 6.01 and 6.02, have been satisfied (or with respect to certificates to be delivered at the Offer Closing or, in the event Approval is Required, the Closing, are capable of being satisfied upon the Offer Closing or Closing, as applicable) at the time when the Offer or the Merger, as applicable, would have been consummated but for the failure of the Parent to comply with its obligations to effect the Closing pursuant to the terms of this Agreement and the Equity Financing to be funded and (ii) the Company has irrevocably confirmed that, if specific performance is granted, then the Offer or the Merger, as applicable, will be consummated.

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(b)          Each of the Company, Parent and Purchaser acknowledges and agrees that the equitable remedies provided in Section 8.12(a) and the payment of the Termination Fee and the Parent Expenses, as provided in Sections 7.02 and 7.03(b), constitute the sole and exclusive remedy under this Agreement and with respect to the Transaction for the party to whom payment thereof has become due and payable. Each of the Company, Parent and Purchaser acknowledges and agrees that in all other circumstances, the parties’ only remedies under this Agreement and with respect to the Transaction shall be (i) prior to a valid termination of this Agreement in accordance with Section 7.01, the equitable remedies to the extent provided in Section 8.12(a), and (ii) following a valid termination of this Agreement in accordance with Section 7.01, the right to seek monetary damages for a willful and material breach of this Agreement to the extent provided in Section 7.03(a) and subject to the limitations provided in Section 8.12(c); provided, however, that in no event shall any party be entitled to receive both of the remedies set forth in the foregoing clauses (i) and (ii) (but such party may seek the remedies set forth in the foregoing clauses (i) and (ii) until one of them is awarded).

(c)          Each of the parties hereto (a) consents to submit itself to the exclusive personal jurisdiction of the U.S. District Court for the Northern District of Georgia or of any state court located in the State of Georgia situated in Fulton County, in the event any dispute arises out of this Agreement or the Transaction, (b) agrees that it will not attempt to deny or defeat such personal jurisdiction by motion or other request for leave from any such court and (c) agrees that it will not bring any action relating to this Agreement or the Transaction in any court other than the U.S. District Court for the Northern District of Georgia or a state court located in the State of Georgia situated in Fulton County.

(d)          Each of the parties hereto agrees that (i) it will not bring or support any action, suit, proceeding, cause of action, claim, cross-claim or third party claim of any kind or description, whether in law or in equity, whether in contract or in tort or otherwise, against the Debt Financing Sources or any Debt Financing Source Related Party in any way relating to this Agreement, the Debt Financing or any of the transactions contemplated hereby or thereby, including any dispute arising out of or relating in any way to the Debt Commitment Letter or any other letter or agreement related to the Debt Financing or the performance thereof, in any forum other than the U.S. District Court for the Southern District of New York or a state court located in the State of New York situated in New York County and (ii) except as specifically set forth in the Debt Commitment Letter, all claims or causes of action (whether at law, in equity, in contract, in tort or otherwise) against the Debt Financing Sources shall be exclusively governed by, and construed in accordance with, the internal Laws of the State of New York, without giving effect to principles or rules of conflicts of laws to the extent such principles or rules would require or permit the application of Laws of another jurisdiction.

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Section 8.13.       Waiver of Jury Trial.  Each party hereto hereby unconditionally and irrevocably waives, to the fullest extent permitted by applicable Law, any right it may have to a trial by jury in respect of any suit, action or other proceeding arising out of this Agreement, the Transaction, the Debt Financing or any of the transactions contemplated thereby. Each party hereto certifies and acknowledges that (a) no representative, agent or attorney of any other party has represented, expressly or otherwise, that such other party would not, in the event of any action, suit or proceeding, 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, (d) such party has been induced to enter into this Agreement, by, among other things, the mutual waiver and certifications in this Section 8.13 and (e) agrees that such waivers, certifications and acknowledgements shall extend to the Debt Financing Sources and the Debt Financing Source Related Parties. The Company acknowledges and agrees that (i) the Company and its Affiliates shall not have any rights or claims against any Debt Financing Source or any Debt Financing Source Related Party, in any way relating to the Debt Commitment Letter or the performance thereof or the financings contemplated thereby, and (ii) none of the Debt Financing Sources and none of the Debt Financing Source Related Parties shall have any liability or obligation to the Company or any of its Affiliates under this Agreement or for any claim based on, in respect of, or by reason of, the Transaction or in respect of any oral representations made or alleged to have been made in connection herewith, including any dispute arising out of or relating to any breach or failure to perform (whether willfully, intentionally, unintentionally or otherwise) any of their obligations relating to the Debt Commitment Letter or the performance thereof or the financings under the Debt Financing.

Section 8.14.        Severability. If any term, condition or other provision of this Agreement is determined by a court of competent jurisdiction to be invalid, illegal or incapable of being enforced by any rule of Law or public policy, all other terms, conditions and provisions of this Agreement shall nevertheless remain in full force and effect. Upon such determination that any term, condition or other provision is invalid, illegal or incapable of being enforced, 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 to the fullest extent permitted by applicable Law in an acceptable manner to the end that the transactions contemplated hereby are fulfilled to the extent possible.

[Remainder of Page Intentionally Left Blank]

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IN WITNESS WHEREOF, Parent, Purchaser and the Company have caused this Agreement to be signed by their respective officers hereunto duly authorized, all as of the date first written above.

BLUE EAGLE HOLDINGS, L.P.
By:	/s/ Merrick Elfman
Name:  Merrick Elfman
Title:    President
BLUE EAGLE ACQUISITION SUB, INC.
By:	/s/Merrrick Elfman
Name:  Merrick Elfman
Title:    President
INNOTRAC CORPORATION
By:	/s/Joel Marks
Name:  Joel Marks
Title:    Chairman, Strategic Alternatives Review Committee

[Signature Page to Merger Agreement]

ANNEX I

Officers of Surviving Corporation

Scott Dorfman

Larry Hanger

Steve Keaveney

Ed Ringer

Robert Toner

ANNEX II

Index of Defined Terms

Term	Section
1997 Stock Option Plan	Section 3.01(b)(i)(C)
2000 Stock Option Plan	Section 3.01(b)(i)(C)
2010 Stock Option Plan	Section 3.01(b)(i)(C)
Acceptable Confidentiality Agreement	Section 4.02(c)
Acquisition Agreement	Section 4.02(b)
Acquisition Transaction	Section 4.02(c)(iii)
Affiliate	Section 8.03(a)
Agents	Section 4.02(a)
Agreement	Preamble
Aircraft Lease	Preamble
Antitrust Division	Section 5.03(b)(i)
Antitrust Laws	Section 5.03(b)(ii)
Balance Sheet	Section 3.01(e)(iii)
Balance Sheet Date	Section 3.01(e)(iii)
Bankruptcy and Equity Exceptions	Section 3.01(c)(i)
Base Premium	Section 5.04(b)
Board	Preamble
Book-Entry Shares	Section 2.01(c)
Business Day	Section 8.03 (b)
Cash Out Options	Section 2.03(b)(i)
Certificate of Merger	Section 1.07
Closing	Section 1.06
Closing Date	Section 1.06
Code	Section 2.03(c)
Committee	Preamble
Common Merger Consideration	Section 2.01(c)
Common Stock	Preamble
Common Stock Certificate	Section 2.01(c)
Commonly Controlled Entity	Section 3.01(l)(i)
Company	Preamble
Company Adverse Recommendation Change	Section 4.02(f)
Company Benefit Plans	Section 3.01(l)(i)
Company Copyrights	Section 3.01(o)
Company Disclosure Schedule	Section 3.01
Company Domain Names	Section 3.01(o)
Company Intellectual Property	Section 3.01(o)(xi)
Company Lease	Section 8.03(c)
Company Marks	Section 3.01(o)
Company Patents	Section 3.01(o)
Company Pension Plan	Section 3.01(l)(i)
Company Recommendation	Section 3.01(c)(i)

Term	Section
Company SEC Documents	Section 3.01(e)(i)
Company Software	Section 3.01(o)
Company Subsidiary	Section 8.03(d)
Company Trade Names	Section 3.01(o)
Company Trade Secrets	Section 3.01(o)(viii)
Company’s Knowledge	Section 8.03(p)
Compensation Committee	Preamble
Confidentiality Agreements	Section 5.02(b)
Continuing Directors	Section 1.04(b)
Continuing Employees	Section 5.08(a)
Contract	Section 3.01(c)(ii)
Contributed Shares	Preamble
Contribution Agreement	Preamble
Debt Commitment Letter	Section 8.03(e)
Debt Financing	Section 8.03(f)
Debt Financing Sources	Section 8.03(g)
Debt Financing Sources Related Parties	Section 8.03(h)
Dissenting Shares	Section 8.03(i)
Effective Time	Section 1.07
Employment Agreements	Preamble
Environment	Section 3.01(j)
Environmental Laws	Section 3.01(j)
ERISA	Section 8.03 (j)
Equity Commitment Letter	Preamble
Equity Financing	Section 8.03(k)
Exchange Act	Section 3.01(d)
Excluded Shares	Section 8.03(l)
Extended End Date	Section 7.01(b)(i)
FTC	Section 5.03(b)(i)
GAAP	Section 3.01(e)(ii)
GBCC	Preamble
Government Approval Condition	Annex III
Governmental Entity	Section 3.01(d)
Guarantor	Section 8.03(m)
Hazardous Materials	Section 8.03(n)
HSR Act	Section 3.01(d)
HW	Section 3.01(q)
Indebtedness	Section 8.03(o)
Indemnitee(s)	Section 5.04(a)
Intellectual Property Rights	Section 3.01(o)(xi)
Intervening Event	Section 4.02(g)(ii)
IPOF Approvals	Annex III
IPOF Receiver	Annex III
IRS	Section 3.01(l)(ii)
Knowledge of the Company	Section 8.03(p)

Term	Section
Laws	Section 8.03(q)
Leased Real Property	Section 8.03(r)
Licenses In	Section 3.01(o)
Licenses Out	Section 3.01(o)
Liens	Section 3.01(c)(ii)
Material Adverse Change	Section 8.03(s)
Material Adverse Effect	Section 8.03(s)
Material Contract	Section 3.01(h)
Material Permits	Section 3.01(i)(ii)
Merger	Preamble
Minimum Condition	Annex III
Nasdaq	Section 8.03(t)
Non-Waivable Conditions	Section 8.03(u)
Offer	Preamble
Offer Closing	Section 1.01(c)
Offer Closing Date	Section 1.01(c)
Offer Conditions	Section 1.01(b)
Offer Documents	Section 1.01(e)
Offer End Date	Section 7.01(b)(i)
Offer Price	Preamble
Offer Termination	Section 1.01(c)
Option Cash Amount	Section 2.03(b)(iii)
Order	3.01(c)(ii)
Organizational Documents	Section 8.03(v)
Parent	Preamble
Parent Expenses	7.02(d)
Parent Material Adverse Effect	Section 8.03(w)
Paying Agent	Section 2.05(a)
Permits	Section 8.03(x)
Permitted Liens	Section 8.03(y)
Person	Section 8.03(z)
Preferred Stock	Section 3.01(b)(i)
Proceeding	Section 8.03(aa)
Promissory Note	Section 1.03(b)
Proxy Statement	Section 3.01(d)
Purchaser	Preamble
Purchaser Common Stock	Section 2.01
Registered IP	Section 3.01(o)
Restraints	Section 6.01(b)
Restricted Stock	Section 2.03(a)(i)
Schedule 13E-3	Section 5.01
Schedule 14D-9	Section 1.02(a)
Schedule TO	Section 1.01(e)
SEC	Section 3.01(d)
Securities Act	Section 3.01(e)(i)

Term	Section
Shareholder Approval	Section 5.01(d)
Shareholders’ Meeting	Section 5.01(d)
Stock Options	Section 3.01(b)(i)(C)
Stock Option Plans	Section 3.01(b)(i)(C)
Subscription Agreement	Preamble
Subsidiary	Section 8.03(bb)
Superior Proposal	Section 4.02(e)
Surviving Corporation	Section 1.05
Systems	3.01(o)(ix)
Takeover Proposal	Section 4.02(e)(i)
Takeover Statutes	Section 3.01(p)
tax or taxes	Section 3.01(m)(xvii)
taxing authority	Section 3.01(m)(xvii)
tax returns	Section 3.01(m)(xvii)
Termination Fee	Section 7.02(a)
Third Party IP Rights	Section 3.01(o)(iv)
Top Customer	Section 3.01(u)
Top Vendor	Section 3.01(u)
Top-Up Exercise Date	Section 1.03(b)
Top-Up Closing	Section 1.03(b)
Top-Up Option	Section 1.03(a)
Top-Up Option Shares	Section 1.03(a)
Transaction	Preamble

ANNEX III

Offer Conditions

Notwithstanding any other term of the Offer or this Agreement, the obligation of Purchaser to accept for payment or, subject to any applicable rules and regulations of the SEC, including Rule 14e-1(c) promulgated under the Exchange Act (relating to Purchaser’s obligation to pay for or return tendered shares of Common Stock promptly after the termination or withdrawal of the Offer), pay for any shares of Common Stock tendered pursuant to the Offer is subject to the satisfaction or, other than the Non-Waivable Conditions, waiver of the following conditions on or prior to the expiration of the Offer:

(a)          Minimum Condition.  There shall have been validly tendered and not validly withdrawn prior to the expiration of the Offer that number of shares of Common Stock (excluding shares of Common Stock tendered pursuant to guaranteed delivery procedures that have not actually been delivered in settlement or satisfaction of such guarantee prior to the expiration of the Offer) that, when added to the shares of Common Stock directly or indirectly owned by Parent and its wholly-owned subsidiaries (including, for purposes of determining whether the Minimum Condition has been satisfied, the Contributed Shares), would represent (i) at least a majority of the shares of Common Stock outstanding on a fully-diluted basis as of the expiration of the Offer and (ii) at least a majority of the shares of Common Stock outstanding on a fully-diluted basis as of the expiration of the Offer other than those shares of Common Stock beneficially owned by Scott D. Dorfman (the “Minimum Condition”).

(b)          Government Approvals.  The waiting period (and any extension thereof) applicable to the Transaction under the HSR Act and any other applicable Antitrust Laws shall have been terminated or expired, and any required approvals thereunder shall have been obtained (the “Government Approval Condition”).

(c)          Injunctions or Restraints.  No Restraint shall be in effect enjoining, restraining, preventing or prohibiting consummation of the Offer or making the consummation of the Offer illegal.

(d)          Other Conditions.

(i)          Representations and Warranties.  (A) The representations and warranties of the Company contained in Sections 3.01(b)(i)-(v), 3.01(c)(i), 3.01(f)(ii), 3.01(p), 3.01(q) and 3.01(s) as such representations and warranties relate to the Company shall be true and correct in all respects at and as of the date of this Agreement and at and as of the expiration of the Offer as though made at and as of the expiration of the Offer and (B) all other representations and warranties of the Company (including Sections 3.01(b)(i)-(v), 3.01(c)(i), 3.01(f)(ii), 3.01(p), 3.01(q) and 3.01(s) as such representations and warranties relate to the Company Subsidiaries) shall be true and correct in all respects (disregarding any “material”, “Material Adverse Effect” or “Material Adverse Change” qualifiers contained therein) as of the date of this Agreement and at and as of the expiration of the Offer as though made at and as of the expiration of the Offer, except where the failure of such representations or warranties described in this clause (B) to be so true and correct would not have a Material Adverse Effect; provided in each case that representations and warranties made as of a specific date shall be required to be so true and correct (for purposes of this clause (B), disregarding any “material”, “Material Adverse Effect” or “Material Adverse Change” qualifiers contained therein) as of such date only.

(ii)         Performance of Obligations of the Company.  The Company shall have performed in all material respects all obligations required to be performed by it under this Agreement at or prior to the expiration of the Offer.

(iii)        Material Adverse Effect. Since the date of this Agreement there shall have occurred a Material Adverse Effect.

(iv)        Required Consents. The Company shall have made or obtained any consents, approvals, Orders, authorizations, registrations, declarations, filings or notices set forth on Section 9 of the Company Disclosure Schedule.

(v)         Failure to Obtain IPOF Approvals.  The Company shall have delivered to Parent evidence of the approval of (i) the special receiver for the IPOF Fund, L.P. assets (“IPOF Receiver”), appointed by the United States District Court for the Northern District of Ohio, authorizing the sale of the Common Stock held by the IPOF Receiver and (ii) the United States District for the Northern District of Ohio for the sale of the Common Stock held by the IPOF Receiver in trust (collectively, the “IPOF Approvals”).

(vi)        FIRPTA Certificate. The Company shall have delivered to Parent a duly executed affidavit, in form and substance reasonably acceptable to the Buyer, dated as of the Offer Closing Date and in compliance with Section 1445 of the Code and the Treasury regulations promulgated thereunder, stating that the Company is not a “United States real property holding corporation” within the meaning of the Code.

The Company shall have delivered to Parent a certificate, dated as of the Offer Closing Date and signed by its Chief Executive Officer, certifying to the effect that the conditions set forth in clauses (d)(i) through (d)(iii) have been satisfied.

EX-2.2

Exhibit 2.2

Sterling Capital Partners IV, L.P.

401 North Michigan Avenue, Suite 3300

Chicago, Illinois 60611

(312) 465-7000

November 14, 2013

Blue Eagle Holdings, L.P.

401 North Michigan Avenue, Suite 3300

Chicago, Illinois 60611

Innotrac Corporation

6465 East Johns Crossing

Johns Creek, Georgia 30097

Re: Equity Financing Commitment

Ladies and Gentlemen:

Reference is made to that certain Agreement and Plan of Merger, dated as of the date hereof (as amended or otherwise modified from time to time, the “Merger Agreement”), by and among Innotrac Corporation, a Georgia corporation (the “Company”), Blue Eagle Holdings, L.P., a Delaware limited partnership (“Parent”), and Blue Eagle Acquisition Sub, Inc., a Georgia corporation (“Purchaser”). Capitalized terms used but not otherwise defined herein shall have the meanings assigned to such terms in the Merger Agreement.

1.          Upon the terms and subject to the conditions set forth herein, Sterling Capital Partners IV, L.P. (the “Investor”) hereby commits (the “Commitment”) to purchase at the Offer Closing and/or, in the event Approval is Required, the Closing equity securities of Parent in an aggregate amount equal to $119,000,000 (the “Commitment Amount”) in order to allow Parent to pay in full all amounts required to be paid by Parent and Purchaser in connection with the consummation of the Transaction. Notwithstanding anything to the contrary herein, the Investor’s obligation to fund in connection with the Transaction, or to otherwise pay any amounts in connection with the Transaction, including all obligations pursuant to this letter agreement, shall in no event exceed the Commitment Amount. The Investor reserves the right to have one or more of its Affiliates fund to Parent all or any portion of the Commitment Amount; provided, that the Investor agrees and acknowledges that it shall remain the primary obligor to fund the Commitment Amount pursuant to the terms and conditions hereof. Notwithstanding anything to the contrary herein or otherwise, in no event shall the aggregate liability of the Investor to fund Parent or otherwise under this letter agreement ever exceed the Commitment Amount.

2.          The Investor’s obligations under this letter agreement, including the obligation of the Investor to fund the Commitment Amount, is subject to (a) the execution and delivery of the Merger Agreement by the Company and the execution and delivery of the other agreements and instruments contemplated therein to be executed in connection therewith by the persons to be party thereto, (b) there having been no amendment or modification to the Merger Agreement or such other agreements that is not approved in writing by the Investor and (c) the satisfaction or waiver by Parent (with the prior written approval of the Investor) of (i) all of the Offer Conditions and all of the conditions set forth in Section 6.01 of the Merger Agreement or (ii) in the event Approval is Required, the conditions in Section 6.01 and Section 6.02 of the Merger Agreement.

3.          The Investor hereby irrevocably, unconditionally, absolutely and continually guarantees, through the Closing, the performance of Parent and Purchaser of the terms and provisions of the Merger Agreement. The Investor agrees that its liability hereunder shall be primary and direct and that the Company shall not be required to pursue any right or remedy it may have against Parent or Purchaser under the Merger Agreement or otherwise or to first commence any proceeding or obtain any judgment against Parent or Purchaser in order to enforce this obligation of the Investor.

4.          The obligation of the Investor to fund the Commitment Amount shall automatically and immediately terminate upon the earliest to occur of (a) the Closing or (b) the valid termination of the Merger Agreement in accordance with its terms.

5.          The Investor represents and warrants to Parent and the Company as follows:

(a)          it has, and shall at all times through the Closing maintain, uncalled, unrestricted capital commitments of no less than the Commitment Amount;

(b)          entering into this letter agreement and the performance of its obligations hereunder does not and will not (i) conflict with its agreement of limited partnership or its certificate of limited partnership, (ii) violate any applicable Law or (iii) conflict with or result in the breach of, or constitute a default under, any Contract binding on or affecting the Investor or any of its assets;

(c)          all necessary action has been taken by the Investor to authorize the execution, delivery and performance by it of this letter agreement, and no consent, filing or approval of any Governmental Entity or other Person is required for due execution, delivery or performance by the Investor; and

(d)          the Investor has all partnership authority to fulfill the Commitment and this letter agreement has been duly and validly executed and delivered by the Investor and this letter agreement constitutes the legal, valid and binding obligation of the Investor, enforceable against the Investor in accordance with its terms.

6.          Other than as required by Law or the rules of any national securities exchange, each of the parties agree that it will not, nor will it permit its advisors or Affiliates to, disclose to any person or entity the contents of this letter agreement, other than to the Company and its advisors (and then, only on a need to know basis and on the basis that any recipients are obligated to retain this letter in confidence).

7.          Notwithstanding anything that may be expressed or implied in this letter agreement or any document or instrument delivered in connection herewith, each party hereto, by its acceptance of the benefits hereof, covenants, agrees and acknowledges that no Person other than the Investor has obligations hereunder and that, notwithstanding that the Investor is a partnership, no Person has any remedy, recourse or right of recovery against, or contribution from any Investor Affiliate, through the Investor, Parent or otherwise, whether by or through attempted piercing of the veil or similar action, by the enforcement of any assessment or by any legal or equitable proceeding, by virtue of any applicable Law, by or through a claim by or on behalf of the Parent against the Investor or any Investor Affiliate, or otherwise, except for Parent’s and the Company’s rights against the Investor under this letter agreement. For purposes of this letter agreement, the term “Investor Affiliate” means any former, current or future general or limited partners, stockholders, holders of any equity, partnership or limited liability company interest, officer, member, manager, director, employees, agents, controlling persons, assignee or affiliates of the Investor.

8.          Subject to the terms set forth herein, this letter agreement may be enforced against the Investor by Parent or the Company. Except for the parties to this letter agreement and the Investor Affiliates (who are express third party beneficiaries of Section 7 of this letter agreement), no other Person shall be entitled to rely upon or enforce the terms of this letter agreement. This letter agreement shall be binding upon and inure solely to the benefit of Investor, Parent, the Company and the Investor Affiliates (as to Section 7 only), and nothing herein, express or implied, is intended or shall confer upon any other person any rights, benefits or remedies whatsoever under or by reason of the Commitment.

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9.          Each party acknowledges and agrees that (a) this letter agreement is not intended to, and does not, create any agency, partnership, fiduciary or joint venture relationship between or among any of the parties hereto and neither this letter agreement nor any other document or agreement entered into by any party hereto relating to the subject matter hereof shall be construed to suggest otherwise, and (b) the obligations of each of the Investors under this letter agreement are solely contractual in nature.

10.        This letter agreement may not be amended or otherwise modified without the prior written consent of Parent, the Company and the Investor.

11.        The parties hereto agree that irreparable damage would occur in the event that any of the provisions of this letter agreement were not performed in accordance with their specific terms or were otherwise breached, and that money damages or other legal remedies would not be an adequate remedy for any such damages. It is accordingly agreed that (i) prior to the valid termination of the Merger Agreement in accordance with its terms, (i) the parties shall be entitled to seek (in a court of competent jurisdiction as set forth in paragraph 13) an injunction or injunctions to prevent breaches of this letter agreement and to enforce specifically the terms and provisions of this letter agreement, without bond or other security being required, and (ii) the right of specific performance is an integral part of the Transaction and without the right, neither the Company nor Parent nor Purchaser would have entered into this letter agreement or the Merger Agreement. Notwithstanding anything to the contrary herein, it is explicitly agreed that the Company shall be entitled to an injunction, specific performance or other equitable remedy to specifically enforce the Investor’s obligation to fund the Commitment on the terms and conditions set forth herein, but only in the event that (a) (I) all of the Offer Conditions and all of the conditions set forth in Section 6.01 of the Merger Agreement have been satisfied (or with respect to certificates to be delivered at the Offer Closing are capable of being satisfied upon the Offer Closing) or (II) in the event Approval is Required, all conditions set forth in Section 6.01 and Section 6.02 of the Merger Agreement have been satisfied (or with respect to certificates to be delivered at the Closing are capable of being satisfied upon the Closing), in either case, at the time when the Closing would have occurred but for the failure of the Commitment to be funded and (b) the Company has irrevocably confirmed that, if specific performance is granted, then the Offer or the Merger, as applicable, will be consummated.

12.        THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF GEORGIA, REGARDLESS OF THE LAWS THAT MIGHT OTHERWISE GOVERN UNDER APPLICABLE PRINCIPLES OF CONFLICTS OF LAWS THEREOF.

13.        Each of the parties hereto (a) consents to submit itself to the exclusive personal jurisdiction of the federal and state courts located in the State of Georgia situated in Fulton County, in the event any dispute arises out of this letter agreement, (b) agrees that it will not attempt to deny or defeat such personal jurisdiction by motion or other request for leave from any such court and (c) agrees that it will not bring any action relating to this letter agreement in any court other than the federal and state courts located in the State of Georgia situated in Fulton County. Each party hereby (i) consents to service of process in any action between the parties arising in whole or in part under or in connection with this letter agreement in any manner permitted by Georgia Law, (ii) agrees that service of process made in accordance with clause (i) or made by registered or certified mail, return receipt requested, at its address specified on the first page of this letter agreement, will constitute good and valid service of process in any such action, and (iii) waives and agrees not to assert (by way of motion, as a defense, or otherwise) in any such action any claim that service of process made in accordance with clause (i) or (ii) does not constitute good and valid service of process.

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14.         Each party hereto hereby unconditionally and irrevocably waives, to the fullest extent permitted by applicable Law, any right it may have to a trial by jury in respect of any Proceeding arising out of this letter agreement. Each party hereto certifies and acknowledges that (a) no representative, agent or attorney of any other party has represented, expressly or otherwise, that such other party would not, in the event of any action, suit or proceeding, 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, (d) such party has been induced to enter into this letter agreement, by, among other things, the mutual waiver and certifications in this paragraph 14.

15.         Notwithstanding anything to the contrary herein or otherwise, (a) recourse by the Company against the Investor under this letter agreement shall be the sole and exclusive remedy of the Company or any of its shareholders against the Investor or any Investor Affiliate (other than Parent or Purchaser) in connection with the consummation of the Transaction, and (b) neither the Company nor any of its shareholders shall, nor shall they be entitled to, bring any claim or action of any kind against the Investor or the Investor Affiliates (other than Parent or Purchaser) arising out of or related to the Transaction, other than claims under this letter agreement.

16.         This letter agreement and any signed agreement or instrument entered into in connection with this letter agreement, and any amendments or waivers hereto or thereto, to the extent signed and delivered by means of a facsimile machine or by e-mail delivery of a “.pdf” format data file, shall be treated in all manner and respects as an original agreement or instrument and shall be considered to have the same binding legal effect as if it were the original signed version thereof delivered in person. No party hereto or to any such agreement or instrument shall raise the use of a facsimile machine or e-mail delivery of a “.pdf” format data file to deliver a signature to this letter agreement or any amendment hereto or the fact that any signature or agreement or instrument was transmitted or communicated through the use of a facsimile machine or e-mail delivery of a “.pdf” format data file as a defense to the formation of a contract and each party hereto forever waives any such defense.

[Signature page follows.]

4

Very truly yours,
	STERLING CAPITAL PARTNERS IV, L.P.
	/s/ Merrick Elfman
	Name: Merrick Elfman
	Title: Senior Managing Director

ACCEPTED AND AGREED
BLUE EAGLE HOLDINGS, L.P.
/s/ Merrick Elfman
Name: Merrick Elfman
Title: President
INNOTRAC CORPORATION
By:	/s/ Joel E. Marks
Name: Joel E. Marks
Title: Chairman, Strategic Alternatives Review Committee

[Signature page to Equity Commitment Letter]

EX-10.1

Exhibit 10.1

SUPPORT AGREEMENT

This Support Agreement ("Agreement"), entered into as of November 14, 2013, is made by and among Innotrac Corporation ("INOC"), Mark E. Dottore, as the Court appointed Receiver for all assets of any kind of IPOF L.P., IPOF Fund, IPOF Fund II, L.P. (which are collectively referred to as the "IPOF Fund") acting for and on behalf of the IPOF Fund, and Blue Eagle Holdings, L.P., a Delaware limited partnership (“Parent”). The IPOF Fund, INOC and Parent are collectively referred to herein as the "Parties."

RECITALS

A.       In November 2005, persons comprising all IPOF Fund limited partner/investors filed or subsequently joined as plaintiffs in an action captioned Sheldon Gordon, et al. v. David Dadante, et al., Case No. 1:05 CV 2726, in the United States District Court for the Northern District of Ohio (the "Receivership Action").

B.       Mark E. Dottore (the "Receiver") was by Orders in the Receivership Action entered November 23, 2005 and December 1, 2005 as supplemented by an Order entered October 6, 2006, duly appointed as the Receiver for all assets of any kind of the IPOF Fund (the "Receivership Estate"), and was invested by the Court with the power to administer the Receivership Estate with the same rights and powers as a general partner in a limited partnership pursuant to the law of Ohio.

C.       Assets of the IPOF Fund for which Dottore is the Receiver include 4,321,771 shares of common stock of INOC (the “Investor Shares”), representing approximately 32.6% of the total shares outstanding.

D.       In addition to the Receivership Action there were other actions pending in the United States District Court for the Northern District of Ohio captioned Amantea v. Innotrac, et al., Case No. 07 CV 03542 (the "Amantea Action"), and Small v. Regalbuto, Case No.1:06 CV 01721 (the "Small Action"), in which certain IPOF Fund limited partners/investors sought to assert individual claims against INOC and certain of its current and former officers and directors. Both the Amantea Action and the Small Action have been dismissed by the Court.

E.       Immediately following the execution and delivery of this Agreement, Parent, INOC, and Blue Eagle Acquisition Sub, Inc., a Georgia corporation and a wholly-owned subsidiary of Parent (“Purchaser”), will enter an Agreement and Plan of Merger, dated as of the date hereof (the “Merger Agreement”).

F.       On the terms and subject to the conditions set forth in the Merger Agreement, (i) Purchaser will commence a tender offer to purchase (the “Offer”) all of the issued and outstanding shares of common stock of INOC at an offer price of $8.20 per share (the “Consideration”) payable in cash, and (ii) following the consummation of the Offer, Purchaser will merge with and into INOC (the “Merger”), with INOC continuing as the surviving corporation, whereby each issued and outstanding share of common stock (other than Excluded Shares, as defined in the Merger Agreement) will be converted into the right to receive the same Consideration per share payable in cash.

G.      The Board of Directors of INOC (the “Board”) formed a standing committee of the Board consisting only of independent and disinterested members of the Board, for the purpose of evaluating strategic opportunities and alternatives for INOC (the “Committee”);

H.      The Committee evaluated and made a unanimous recommendation to the full Board to approve the execution, delivery and performance of the Merger Agreement, the Offer and the Merger;

I.        The Board, acting upon the unanimous recommendation of the Committee, and on the terms and subject to the conditions set forth in the Merger Agreement, has unanimously (other than Scott D. Dorfman, who recused himself) (i) determined that it is in the best interests of INOC and its shareholders, and declared it advisable, to enter into the Merger Agreement, (ii) approved the execution, delivery and performance by INOC of the Merger Agreement and the Offer and the Merger and (iii) resolved to recommend that the shareholders of INOC accept the Offer and tender their shares of common stock to Purchaser in the Offer;

J.       The Parties each believe that the terms of the Merger Agreement are in the best interests of INOC and the IPOF Fund, and will provide the IPOF Fund with fair value for its shares of INOC.

K.      The Parties are entering into this Agreement in conjunction with the Merger Agreement.

L.       This Settlement Agreement is subject to approvals by the United States District Court for the Northern District of Ohio in the Receivership Action, and such determinations or findings the Court deems necessary or appropriate to effectuate the Agreement ("Court Approval"), as well as issuing certain ancillary orders as provided herein.

NOW THEREFORE, the Parties, for the consideration recited and as set forth herein, and, subject to Court Approval, intending to be legally bound, hereby agree as follows:

1.          Tender of Innotrac Stock. Subject to the Court Approval described herein, the Receiver and the IPOF Fund agree that the Receiver and the IPOF Fund shall tender all of the Investor Shares in the Offer and thereby receive in the Offer the same Consideration per share to be paid to all other INOC shareholders pursuant to the Merger Agreement. The Receiver shall receive the IPOF Fund's share of the Consideration with respect to the Investor Shares directly from the Purchaser, as provided in the Merger Agreement. The Parties agree that the Consideration per share provided for in the Agreement is a fair and equitable price for INOC shares and it is in the best interests of all INOC shareholders to tender INOC shares to the Purchaser and otherwise support the Offer and the Merger. The purchase of INOC shares for an amount equal to the Consideration per share is a material term of this Agreement and this Agreement will be of no further effect if the terms of the Merger Agreement are not consummated for any reason.

2.          Court Approval. Within one day of the execution of this Agreement, the Receiver will file a motion in the Receivership Action that will include a request for immediate conditional approval and for final approval from the Court regarding the matters described in Section 3 below. The Parties agree that obtaining said conditional approval and final approval is a material term of this Agreement and the Merger Agreement. The Receiver shall exercise his best efforts to obtain conditional approval as provided herein no later than two days after the filing of the motion seeking approval of this Agreement. Final approval shall be subject to such orders the Court may issue and on a schedule to be determined by the Court. The Parties agree to file such motions and briefs and to present such arguments and otherwise use their reasonable best efforts to take any and all such further actions as may be necessary or appropriate to support this Agreement, the Merger Agreement and to obtain Court Approval.

4.          Conditions. It is a condition to the effectiveness of Sections 1 through 3 and 5 through 6 of this Agreement, that: (i) the Court grant conditional and final approval of this Agreement, (ii) the Court grant conditional and final approval of the sale of the Investor Shares pursuant to the Merger Agreement, and (iii) the Court issue the Bar Order in the form attached as Exhibit A.

5.          Receivership Account and Conditions for Distribution of Funds. The Consideration to be received by the Receiver from the sale of the Investor Shares in the Offer pursuant to the Merger Agreement shall be held in the IPOF Fund Receivership account for the benefit of the limited partners/investors and potential creditors of the IPOF Fund. None of the Consideration is to be distributed by the Receiver to any person or entity absent further order of Court and unless and until all of the following conditions are satisfied:

(a) Such person has executed, with such execution witnessed by a Notary Public, and delivered a release in the form of Exhibit B for the benefit of INOC and its direct or indirect subsidiaries, parents, successors and other affiliates, and their respective past, present and future officers, directors, shareholders, affiliates, employees, agents and representatives, and their respective successors, predecessors, heirs and assigns and attorneys (collectively, the "INOC Released Parties"), and the Purchaser and its direct or indirect subsidiaries, parents, successors and other affiliates, and their respective past, present and future officers, directors, shareholders, affiliates, employees, agents and representatives, and their respective successors, predecessors, heirs and assigns and attorneys (collectively, the "Purchaser Released Parties"), and the Receiver;

(b) The release and distribution has been approved by the Court as part of the Court's approval of the terms of this Agreement and such plan of distribution and determination of rightful claims by the Receiver has been approved by the Court;

(c) The Court has issued final orders pursuant to Fed. R. Civ. P. 54(b) with respect to the Court's approval of the terms of this Agreement and such plan of distribution; and

(d) The Bar Order referenced in Section 4(iii) above remains in effect.

6.          Receiver's Reporting on Distribution of Funds. The Receiver shall provide the following reports related to the distribution of the Consideration:

(a)      Within two (2) days of the execution of this Agreement, the Receiver shall provide to INOC and Purchaser a written report identifying: (i) each IPOF Fund limited partner or investor, and (ii) the amount of each limited partner's or investor's aggregate capital contribution to the IPOF Fund (prior to any distributions or recoveries).

(b)      Upon any distribution of the Consideration under the terms of Section 5(a) through (d) of this Agreement, the Receiver shall provide to INOC and Purchaser a copy of the release in the form of Exhibit B hereto executed by the IPOF Fund limited partner or investor and a written report identifying the amount distributed to such IPOF Fund limited partner or investor.

7.          Ownership Interest. Nothing contained in this Agreement shall be deemed to vest in Parent any direct or indirect ownership or incidence of ownership of or with respect to any Investor Shares. All rights, ownership and economic benefits of and relating to the Investor Shares shall remain vested in and belong to the IPOF Fund, and, subject to the obligations of the IPOF Fund under this Agreement, Parent shall have no authority to direct the IPOF Fund in the voting or disposition of any of the Investor Shares.

8.          Termination. This Agreement shall terminate, without further action by any of the Parties, and none of the Parties shall have any rights or obligations under this Agreement, immediately upon the earliest to occur of: (i) the termination of this Agreement by mutual written consent of all of the Parties, (ii) the termination of the Merger Agreement in accordance with its terms, (iii) the Special Committee of the Board effecting a Company Adverse Recommendation Change (as defined in the Merger Agreement), and (iv) the Effective Time of the Merger.

9.          Third-Party Beneficiaries. No provision of this Agreement is intended to or shall be construed to grant or confer any right to enforce this Agreement, or any remedy for breach of this Agreement, to or upon any person, other than the parties hereto.

9.          Attorneys' Fees and Costs. Each Party shall bear its own costs and attorneys' fees incurred in the Receivership, Small and Amantea Actions, and in performing its covenants under this Agreement. This paragraph shall not be construed to preclude the INOC Released Parties or the Purchaser Released Parties from seeking to recover their reasonable attorneys' fees and expenses from any other person, either in the Receivership, Small and Amantea Actions or any other case, including the individual plaintiffs in those cases, pursuant to Fed. R. Civ. P. 11 or otherwise, if an INOC Released Party or Purchaser Released Party is forced to file motions or briefs or to take other action to enforce or to defend this Agreement or to have the claims against the INOC Released Parties or the Purchaser Released Parties in the Receivership, Small or Amantea Actions or other cases dismissed. The Receiver agrees that he shall take and bear the expense of any and all actions as is reasonably necessary or appropriate to obtain and enforce the Bar Order as provided in Sections 4 and 5 above.

10.        Continuing Jurisdiction. The United States District Court for the Northern District of Ohio shall retain jurisdiction to enforce this Agreement and any disputes or other claims and/or cases that relate to or involve this Agreement.

11.        Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Ohio without regard to the conflicts of law principles thereof.

12.        Entire Agreement. This Agreement and the Exhibits hereto constitute the entire agreement between and among the Parties regarding the claims and matters discussed herein. Except as expressly set forth in this Agreement, there are no representations, warranties, or endorsements, whether oral, written, expressed or implied, that in any way affect or condition the validity of this Agreement or any of its conditions or terms. Any other provisions of this Agreement to the contrary notwithstanding, this Agreement may be modified only by a writing signed by all Parties and this provision cannot be orally waived.

13.        Severability. If any term, condition or provision contained herein shall contravene or be invalid under applicable law, such contravention or invalidity shall not invalidate the whole Agreement, but the Agreement shall be construed as not containing the particular term and condition or provision held to be invalid, and the rights and obligations of the Parties shall be construed and enforced accordingly.

14.        Representations. This Agreement is executed voluntarily and without any duress or undue influence on the part or behalf of the Parties, with the full intent of releasing all claims against each other. Each Party acknowledges that:

(a)          It has read this Agreement;

(b)          It has been represented in the preparation, negotiation, and execution of this Agreement by legal counsel of its own choice;

(c)          It understands the terms and conditions, provisions, and consequences of this Agreement and of the agreements it contains; and

(d)          It is fully aware of the legal and binding effect of this Agreement.

15.        Assignment. This Agreement shall not be assigned by any party without the prior written consent of all other parties. This Agreement shall be binding on, enforceable by and inure to the benefit of, each of the parties and their successors or assigns, provided that no assignment shall release the assignor from its obligations under the Agreement unless the other parties agree in writing to such release.

16.        Authority. Each person executing this Agreement on behalf of any other person or persons hereby warrants that it has full authority to do so.

17.        Facsimile Signatures. Execution of this Agreement may be by facsimile signature which shall be deemed to constitute an original.

18.        Counterparts. This Agreement may be executed in counterparts.

IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed by their duly authorized representatives, on the respective dates set forth below.

Dated:  November  14, 2013 INNOTRAC CORPORATION

By: /s/ Stephen Keaveney

Its:  Stephen Keaveney, Chief Financial Officer

Dated:  November 14, 2013	IPOF FUND, L.P., IPOF Fund, IPOF Fund II,
	GSI and GSGI

By:	/s/ Mark E. Dottore
	Mark E. Dottore, Receiver

Dated:  November 14, 2013 BLUE EAGLE HOLDINGS, L.P.

By:	/s/ Merrick Elfman
Its:	Merrick Elfman, President

Exhibit "A" to Support Agreement

Dated November 14, 2013

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF OHIO
Eastern Division

SHELDON GORDON, et al.,	Case No. 1:05CV2726
Plaintiffs,	Judge Christopher Boyko
v.
DAVID DADANTE, et al.
Defendants.

MARK SMALL, et al.,	Case No. 1:06CV1721
Plaintiffs,	Judge Christopher Boyko
v.
FRANK REGALBUTO, et al.
Defendants.

NANCY AMANTEA, et al.,	Case No. 1:07CV3542,
Plaintiffs,	Judge Christopher Boyko
v.
INNOTRAC, INC., et al.
Defendants.

BAR ORDER, PERMANENT INJUNCTION AND DISMISSAL OF CLAIMS

WHEREAS, on November _________, 2013, Mark E. Dottore, Receiver ("Receiver"), filed a motion (the "Motion") seeking a judicial determination that in connection with a proposed support agreement among Innotrac Corporation ("INOC"), IPOF Fund, L.P. ("IPOF") and Blue Eagle Holdings, L.P., a Delaware limited partnership, in the above-captioned action Case No. 1:05CV2726 (the "Receivership Action"): (i) an order should issue dismissing any and all claims, counterclaims, crossclaims and third-party complaints against INOC and certain of its officers named as defendants (the "INOC Defendants") pending in the Receivership Litigation or formerly pending in the cases captioned Amantea v. Innotrac, et al., Case No. 07 CV 03542 (the "Amantea Action"), and Small v. Regalbuto, Case No.1:06 CV 01721 (the "Small Action"), which were previously dismissed without prejudice; and (ii) an order should issue barring and enjoining any and all present and future claims against the persons and entities defined herein as the "INOC Released Parties," whether for indemnity, contribution, or otherwise, arising out of, in connection with, or in any way related to the Receivership Action, the Amantea Action, the Small Action, or the allegations therein; and

WHEREAS, due and proper notice of the Motion and the hearing held in connection with the Motion on _______, 2013 (the "Hearing") has been given to all interested persons, and the Court has considered the papers filed by Receiver in support of its Motion, and all objections to the Motion whether filed with the Court or presented at the Hearing, and such other and further evidence and argument as was presented at the Hearing.

NOW, THEREFORE, it is hereby ordered that:

I.      For purposes of this Order, the term "INOC Released Parties" refers to INOC, Scott Dorfman, David L. Gansey, David Ellin, Larry C. Hanger, Robert Toner, Jr., and INOC's direct or indirect subsidiaries, parents, successors and other affiliates, and their respective past, present and future officers, directors, shareholders, affiliates, employees, agents and representatives, and their respective successors, predecessors, heirs and assigns and attorneys, and each of them. The successors of Innotrac Corporation included in the term "INOC Released Parties" shall include Blue Eagle Acquisition Sub, Inc. (“Purchaser”) and its direct or indirect subsidiaries, parents, successors and other affiliates, and their respective past, present and future officers, directors, shareholders, affiliates, employees, agents and representatives, and their respective successors, predecessors, heirs and assigns and attorneys.

II      For purposes of this Order, the term "IPOF" refers to IPOF L.P., IPOF Fund, IPOF Fund II, L.P., (which are collectively referred to as "IPOF") and their respective direct or indirect subsidiaries, parents and other affiliates, all general and limited partners and investors, and their respective past, present and future employees, officers, directors, successors, predecessors, heirs and assigns and attorneys, and each of them.

III.      For purposes of this Order, the term "Receiver" refers to Mark E. Dottore, in his capacity as Receiver of IPOF.

IV.      For purposes of this Order, the term "Non-Settling Parties" refers to:

A. all plaintiffs, defendants, counter-defendants, cross-defendants and third-party defendants, other than the INOC Released Parties, in the Receivership, Small and Amantea Actions; and

B. any other person or entity that directly or through his/her/its counsel has been served with notice of the hearing on the Motion.

V.      Each of the Non-Settling Parties is hereby permanently barred, enjoined and restrained from continuing, commencing, prosecuting, or asserting any claim against the INOC Released Parties arising out of the facts or circumstances alleged in the Receivership, Small or Amantea Actions or arising out of or relating in any way to the purchase or ownership of INOC stock by the IPOF Fund or any other entity created by, maintained by, or relating in any way to David Dadante, or the trading in, granting or exercising of options in, or alleged manipulation of INOC stock.

VI.      The INOC Released Parties are hereby permanently barred, enjoined and restrained from commencing, prosecuting, or asserting any claim for indemnity or contribution for INOC's liability to IPOF, or any similar claim where the injury to INOC is INOC's liability to IPOF, against the Non-Settling Parties, arising out of or relating to the claims or allegations in the Receivership, Small or Amantea Actions.

VII.    It is the Judgment of the Court that all claims against the INOC Released Parties in the Receivership, Small and Amantea Actions are hereby dismissed with prejudice.

VIII.    Any judgment obtained by the Receiver or IPOF against any of the Non-Settling Parties, or any party other than the INOC Released Parties, shall be reduced in accordance with applicable law.

IX.      Neither the support agreement, nor any of its terms or provisions, nor any of the negotiations or proceedings connected with it, nor any of the documents or statements referred to therein shall be:

A. construed as or deemed in any judicial, administrative, arbitration or other type of proceeding to be evidence of a presumption, concession, or an admission by the INOC Released Parties of the truth of any fact alleged or the validity of any claim that has been, could have been, or in the future might be asserted in the Receivership, Small or Amantea Actions; or

B. construed as a concession or an admission by the INOC Released Parties that IPOF has suffered any damage.

X.       The Court shall have and retain jurisdiction over the parties for all matters related to the administration, interpretation, effectuation, or enforcement of this Order, the support agreement among INOC, IPOF and Parent and any related disputes.

XI.      There is no just reason for delay in the entry of final judgment as to the INOC Released Parties, and the Court hereby directs the clerk to enter judgment dismissing with prejudice all claims against the INOC Defendants, specifically including INOC, Scott Dorfman, David L. Gansey, David Ellin, Larry C. Hanger and Robert Toner, Jr. pursuant to Rule 54(b) of the Federal Rules of Civil Procedure.

XII.     The clerk shall promptly serve copies of this Order upon all parties to this Action.

XIII.    The Receiver shall promptly serve all other persons whom he believes may be subject to any provision of this Order, and shall, within thirty (30) calendar days from the date of entry of this Order, submit to this Court an affidavit identifying the name, address, date of service, and manner of service of each such Person he served with a copy of this Order in compliance with this provision.

JUDGE CHRISTOPHER A. BOYKO DATE

Exhibit "B" to Support Agreement

dated November 14, 2013

ALL TO WHOM THESE PRESENTS SHALL COME OR MAY CONCERN, KNOW THAT_____________, an investor in IPOF FUND, L.P., IPOF II L.P., or any affiliate entity thereof ( collectively the "IPOF Fund"), as Releaser, on its own behalf and on behalf of each of its direct or indirect subsidiaries, parents, successors and other affiliates, general and limited partners and investors, and their respective past, present and future officers, directors, shareholders, affiliates, employees, agents and representatives, and their respective successors, predecessors, heirs and assigns and attorneys, whether in a representative or individual capacity, in consideration of the sum of One Dollar and other good and valuable consideration received from the IPOF Fund, the receipt whereof is hereby acknowledged, jointly and severally, fully and forever release and discharge, and covenant not to sue, any of INOC, Scott Dorfman, David L. Gamsey, David Ellin, Larry C. Hanger, Robert Toner, Jr. and INOC's direct or indirect subsidiaries, parents, successors and other affiliates, and their respective past, present and future officers, directors, shareholders, affiliates, employees, agents and representatives, and their respective successors, predecessors, heirs and assigns and attorneys, and Blue Eagle Acquisition Sub, Inc. (“Purchaser”), and its direct or indirect subsidiaries, parents, successors and other affiliates, and each of their respective past, present and future officers, directors, shareholders, affiliates, employees, agents and representatives, and their respective successors, predecessors, heirs and assigns and attorneys, whether in a representative or individual capacity, with respect to all manner of actions, causes of action, suits, debts, dues, charges, complaints, claims, liabilities, obligations, promises, agreements, controversies, damages and expenses (including attorneys' fees and costs) (collectively referred to as "Claims") of any nature whatsoever, in law or equity, which Releaser or any of them have had, now have, or may in the future have, including but not limited to Claims that have been or could have been brought with respect to the facts or circumstances alleged in the Receivership, Small or Amantea Actions or which arise out of or relate in any way to (i) the purchase or ownership of INOC stock by the IPOF Fund or any other entity created by, maintained by, or relating in any way to David Dadante, (ii) the trading in, granting or exercising of options in, or alleged manipulation of INOC stock, or (iii) the tender offer by Purchaser pursuant to which the IPOF Fund will receive, or has received, $8.20 per share of INOC common stock.

This Release may not be changed without the written consent of INOC or its successor. This Release and the rights and obligations established therein shall be governed and construed by the laws of the State of Ohio.

IN WITNESS WHEREOF, Releasor has caused this Release to be executed on _________2013,

by:

	BY:
	(Print full name)
Witness:
Notary Public

EX-10.2

Exhibit 10.2

CONTRIBUTION AND SUPPORT AGREEMENT

This CONTRIBUTION AND SUPPORT AGREEMENT (this “Agreement”), dated as of November 14, 2013, is made by and among Blue Eagle Holdings, L.P., a Delaware limited partnership (“Parent”), and the undersigned shareholders of the Company (the “Investors”). Parent and the Investors are sometimes individually referred to herein as a “Party” and collectively as the “Parties.” Capitalized terms used but not defined herein shall have the meanings set forth in the Merger Agreement (as defined herein).

RECITALS

A.           Immediately following the execution and delivery of this Agreement, Parent, Innotrac Corporation, a Georgia corporation (the “Company”), and Blue Eagle Acquisition Sub, Inc., a Georgia corporation and a wholly-owned subsidiary of Parent (“Purchaser”), will enter into an Agreement and Plan of Merger, dated as of the date hereof (the “Merger Agreement”).

B.           On the terms and subject to the conditions set forth in the Merger Agreement, (i) Purchaser will commence a tender offer to purchase (the “Offer”) all of the issued and outstanding shares of common stock of the Company, par value $0.10 per share (the “Common Stock”), at an offer price equal to the Offer Price payable to the seller in cash, without interest, subject to withholding of taxes required by applicable Law and (ii) following the consummation of the Offer and at the Effective Time, Purchaser will merge with and into the Company (the “Merger”), with the Company continuing as the surviving corporation, whereby each issued and outstanding share of Common Stock (other than Excluded Shares) will be converted into the right to receive the Common Merger Consideration payable to the seller in cash, without interest, subject to withholding of taxes required by applicable Law.

C.           Each Investor beneficially owns the number of shares of Common Stock set forth opposite such Investor’s name on Schedule I hereto under the heading “Investor Owned Shares” (such shares of Common Stock, together with any other shares of Common Stock the beneficial ownership of which is directly or indirectly acquired by such Investor until the termination of this Agreement pursuant to the terms hereof, are collectively referred to herein as the “Investor Owned Shares”).

D.           At the Contribution Closing (as defined herein), each Investor will contribute to Parent all of the Investor Owned Shares owned by such Investor.

E.           In exchange for the Investor Owned Shares contributed by each Investor, at the Contribution Closing, Parent will issue and deliver to such Investor (the “Exchange”) the number of preferred units in Parent (“Preferred Units”) set forth opposite such Investor’s name on Schedule I hereto under the heading “Exchange Units” (such Preferred Units, the “Exchange Units”).

F.           The Contribution and Exchange is intended to qualify as a contribution of property in exchange for a partnership interest under Section 721 of the Code.

G.           Immediately following the Contribution Closing, Parent will cause one or more of its Affiliates to acquire from each Investor the number of Exchange Units set forth opposite such Investor’s name on Schedule I hereto under the heading “Purchased Units”) (such Exchange Units, the “Purchased Units”) pursuant to the terms and conditions of a unit purchase agreement in substantially the form attached hereto as Exhibit A (the “Unit Purchase Agreement”).

H.            In order to facilitate the Contribution and Exchange in accordance with the requirements of Rule 14d-10(a)(2) promulgated under the Exchange Act with respect to the Offer, none of the Investors will tender any of the Investor Owned Shares in connection with the Offer.

NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth below, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:

ARTICLE I

CONTRIBUTION AND EXCHANGE; PURCHASE AND SALE of purchased units

Section 1.1           Contribution and Exchange.

(a)           Upon the terms and subject to the conditions of this Agreement, at the Contribution Closing, (i) each Investor shall transfer, contribute and deliver to Parent all of such Investor’s Investor Owned Shares, free and clear of all Liens other than any such Lien arising hereunder and any applicable restriction on transfer under applicable securities Law, and (ii) in exchange for such Investor Owned Shares, Parent shall issue and deliver to such Investor the number of Exchange Units set forth opposite such Investor’s name on Schedule I hereto.

(b)           Each Investor shall be deemed to have contributed to the capital of Parent securities with a fair market value equal to (i) the Offer Price multiplied by (ii) the number of Investor Owned Shares contributed to Parent by such Investor hereunder. The aggregate fair market value of each Investor’s Investor Owned Shares is set forth opposite such Investor’s name on Schedule I hereto.

(c)           The Contribution and Exchange is intended to qualify as a contribution of property in exchange for a partnership interest under Section 721 of the Code. The parties agree to file all applicable income tax returns consistent with such treatment and not take any position inconsistent with such treatment.

Section 1.2           Contribution Closing.  Subject to the satisfaction or waiver of the conditions to the Contribution set forth in Section 1.3, the closing of the Contribution and Exchange (the “Contribution Closing”) will take place immediately after Purchaser’s acceptance of the shares of Common Stock tendered pursuant to the Offer at the offices of Kilpatrick Townsend & Stockton LLP, 1100 Peachtree Street NE, Suite 2800, Atlanta, Georgia 30309-4528. At the Contribution Closing, each Investor will deliver or cause to be delivered to Parent (a) stock certificates, if any, representing such Investor’s Investor Owned Shares, with duly executed stock powers attached in proper form to enable delivery and transfer of such Investor Owned Shares from such Investor to Parent or its designees and (b) a counterpart signature page to the Amended and Restated Limited Partnership Agreement of Parent, in substantially the form attached hereto as Exhibit B (the “Limited Partnership Agreement”). Upon receipt of the foregoing deliveries by Parent, and effective as of the Contribution Closing, each Investor will be admitted as a limited partner of Parent. The rights, privileges and preferences of the Exchange Units issued to each Investor shall be as set forth in the Limited Partnership Agreement. The date upon which the Contribution Closing occurs is the “Contribution Closing Date”.

Section 1.3           Conditions to Contribution and Exchange.

(a)           Conditions to Parent’s Obligations.   The obligations of Parent to consummate the Contribution and Exchange are subject to the satisfaction or waiver by Parent of the following conditions:

(i)          all of the conditions to the consummation of the Merger under the Merger Agreement shall have been satisfied;

(ii)         the representations and warranties of each Investor contained in Article IV of this Agreement shall be true and correct in all material respects as of the date of this Agreement and as of the Contribution Closing Date with the same force and effect as if made on and as of such date;

(iii)        each Investor shall have performed in all material respects all of its obligations under this Agreement required to be performed by it at or prior to the Contribution Closing; and

(iv)        no Restraint shall be in effect enjoining, restraining, preventing or prohibiting the consummation of the Contribution and Exchange or making the consummation of the Contribution and Exchange illegal.

(b)          Conditions to Investors’ Obligations.   The obligations of each Investor to consummate the Contribution and Exchange are subject to the satisfaction or waiver by such Investor of the following conditions:

(i)          all of the conditions to the consummation of the Merger under the Merger Agreement shall have been satisfied;

(ii)         the representations and warranties of Parent contained in Article V of this Agreement shall be true and correct in all material respects as of the date of this Agreement and as of the Contribution Closing Date with the same force and effect as if made on and as of such date;

(iii)        Parent shall have performed in all material respects all of its obligations under this Agreement required to be performed by it at or prior to the Contribution Closing; and

(iv)        no Restraint shall be in effect enjoining, restraining, preventing or prohibiting the consummation of the Contribution and Exchange or making the consummation of the Contribution and Exchange illegal.

Section 1.4         Purchase and Sale of Purchased Units.   Immediately following the Contribution Closing (the “Purchase and Sale Closing”), Parent will cause one or more of its Affiliates to acquire from each Investor the number of Purchased Units set forth opposite such Investor’s name on Schedule I hereto pursuant to the terms and conditions set forth in the Unit Purchase Agreement. Upon the Purchase and Sale Closing, (a) each Investor shall deliver to Parent a copy of the Unit Purchase Agreement, duly executed by such Investor, and (b) Parent shall cause its designated Affiliate(s) to deliver to each Investor a copy of the Unit Purchase Agreement, duly executed by such Affiliate.

ARTICLE II

COVENANTS REGARDING INVESTOR OWNED SHARES

Section 2.1          Agreement Not to Tender.   Each Investor agrees that such Investor shall not, without the prior written consent of Parent, directly or indirectly, tender such Investor’s Investor Owned Shares into the Offer in any manner. Each Investor agrees to comply in all respects with Rule 14e-5 promulgated under the Exchange Act (notwithstanding whether such Investor would be subject to Rule 14e-5).

Section 2.2           Voting Agreement.

(a)          From and after the date hereof, at any meeting of the Company’s shareholders (or any adjournment or postponement thereof), however called, each Investor separately agrees to vote (or cause to be voted) in person or by proxy all of such Investor’s Investor Owned Shares:

(i)          in favor of (and shall provide written consent to) the approval of the Merger Agreement and the Transaction (and in favor of any actions and proposals required, or submitted for approval at any meeting of the Company shareholders, in furtherance thereof);

(ii)         against (and shall not provide any written consent to) any proposal presented to the Company’s shareholders for approval at any meeting of the Company’s shareholders, or any written consent in lieu thereof, if the action, transaction or agreement that is the subject of such proposal, following approval by the Company’s shareholders would reasonably be expected, directly or indirectly, to result in a breach by the Company of any covenant, representation, warranty or other obligations of the Company set forth in the Merger Agreement; and

(iii)        against (and shall not provide any written consent to) the following actions or proposals (other than the Transaction): (A) any Takeover Proposal; (B) the adoption of any Acquisition Agreement or any other agreement relating to a Takeover Proposal, (C) any nominee for election to the Board other than (x) a Person nominated by the Board or any committee thereof and/or (y) Scott D. Dorfman; or (D) any other action or proposal to be voted upon by the Company’s shareholders at any meeting of the Company’s shareholders, or any written consent in lieu thereof, if such action or proposal would reasonably be expected, to prevent, impede, interfere with, delay, postpone or adversely affect the Transaction.

(b)          Each Investor separately agrees to cause such Investor’s Investor Owned Shares to be duly counted for purposes of determining that a quorum is present and for purposes of recording the results of any vote or consent required pursuant to Section 2.2(a).

(d)          Parent acknowledges that each Investor has entered into this Agreement solely in his, her or its capacity as the record or beneficial owner of his, her or its Investor Owned Shares (and not in any other capacity, including any capacity as a director or officer of the Company). Nothing herein shall limit or affect any actions taken by any Investor in such Investor’s capacity as a director or officer of the Company, or require any Investor to take any action in such Investor’s capacity as a director or officer of the Company. Without limiting the foregoing, and for the avoidance of doubt, nothing in this Section 2.2(c) shall affect any of the rights or remedies of Parent and Purchaser under the Merger Agreement or relieve the Company from any breach or violation of the Merger Agreement caused by any action or omission of any Investor (in such Investor’s capacity as a director or officer of the Company or otherwise).

Section 2.3           Irrevocable Proxy.

(a)          In furtherance of each Investor’s agreements in Sections 2.1 and 2.2 of this Agreement, each Investor hereby appoints Parent and Parent’s designees, and each of them individually, as such Investor’s proxy and attorney-in-fact (with full power of substitution) (the “Proxyholders”), for and in the name, place and stead of such Investor, to vote all Investor Owned Shares owned by such Investor (at any meeting of the Company’s shareholders (or any adjournment or postponement thereof), however called), or to execute one or more written consents in respect of such Investor Owned Shares with respect to the matters described in Section 2.2(a) of this Agreement. If any Investor fails for any reason to be counted as present or to vote (including by written consent, if applicable) such Investor’s Investor Owned Shares in accordance with the requirements of Section 2.2(a) above, then Parent shall have the right to cause to be present or vote such Investor’s Investor Owned Shares in accordance with the provisions of Section 2.2(a). The Proxyholders may not exercise this irrevocable proxy on any matter except as provided above. Each Investor may vote such Investor’s Investor Owned Shares on all other matters.

(b)          The proxy granted pursuant to Section 2.3(a) shall (i) be valid and irrevocable until the valid termination of this Agreement in accordance with (or as otherwise provided in) Article VI hereof and (ii) automatically terminate upon the valid termination of this Agreement in accordance with (or as otherwise provided in) Section 6.1 hereof. Each Investor represents that any and all other proxies and powers of attorney heretofore given in respect of such Investor’s Investor Owned Shares owned by such Investor are revocable, and that such other proxies have been revoked. Each Investor affirms that the foregoing proxy is: (A) given (I) in connection with the execution of the Merger Agreement and (II) to secure the performance of such Investor’s duties under this Agreement, (B) coupled with an interest and may not be revoked except as otherwise provided in this Agreement and (C) intended to be irrevocable prior to valid termination of this Agreement or as otherwise provided in Section 6.1 hereof. All authority herein conferred shall survive the death, bankruptcy or incapacity of such Investor and shall be binding upon the heirs, estate, administrators, personal representatives, successors and assigns of such Investor.

Section 2.4           Documentation and Information; Schedule 13E-3.

(a)          Each Investor (i) consents to and authorizes the publication and disclosure by Parent of such Investor’s identity and holdings of such Investor’s Investor Owned Shares and the nature of such Investor’s commitments, arrangements and understandings under this Agreement, in any press release, the Offer Documents or any other disclosure document required in connection with the Transaction, and (ii) will use reasonable best efforts to give to Parent, as promptly as practicable, any information reasonably related to the foregoing as it may reasonably require for the preparation of any such disclosure documents. Each Investor will use reasonable best efforts to notify Parent, as promptly as practicable, of any required corrections with respect to any written information supplied by such Investor specifically for use in any such disclosure document, if and to the extent such Investor becomes aware that any such information has become false or misleading in any material respect.

(b)          Without limiting the generality of the foregoing, on the date the Offer Documents and the Schedule 14D-9 are initially filed with the SEC, the Investors (together with the Company and Purchaser) shall, in a manner that complies with Rule 13e-3 promulgated under the Exchange Act, jointly file with the SEC the Schedule 13E-3 and shall jointly with the Company and Purchaser mail the Schedule 13E-3 to the holders of Common Stock promptly after filing the Schedule 13E-3 with the SEC. Each Investor shall promptly correct any information provided by it for use in the Schedule 13E-3 if and to the extent that such information shall have become false or misleading in any material respect, and each Investor shall take all steps necessary to amend or supplement the Schedule 13E-3 and to cause the Schedule 13E-3, as so amended or supplemented, to be filed with the SEC and disseminated to the Company’s shareholders, in each case as and to the extent required by the Exchange Act. Each Investor and the counsel for the Investors shall be given a reasonable opportunity to review the Schedule 13E-3 before it is filed with the SEC. Each Investor shall promptly notify Parent and the Company upon the receipt of any comments from the SEC (or the staff of the SEC) or any request from the SEC (or the staff of the SEC) for amendments or supplements to the Schedule 13E-3, and shall provide Parent and the Company with copies of all correspondence (or telephonic notice of any oral responses or discussions) with the SEC (or the staff of the SEC). Each Investor shall use reasonable best efforts to respond as promptly as reasonably practicable to any comments of the SEC (or the staff of the SEC) with respect to the Schedule 13E-3. Prior to the filing of any amendment or supplement to the Schedule 13E-3 or responding to any comments of the SEC (or the SEC staff) with respect to the Schedule 13E-3, each Investor shall have a reasonable opportunity to review and to propose comments on such document or response.

Section 2.5           Other Actions.  Each Investor agrees not to enter into any agreement or commitment with any Person the effect of which would, or would reasonably be expected to, violate, be inconsistent with or otherwise frustrate the purposes of the provisions and agreements set forth in this Article II.

ARTICLE III

STANDSTILL AND NON-SOLICITATION

Section 3.1           Standstill in Respect of Investor Owned Shares.  Each Investor hereby agrees that, from and after the date hereof until the earlier of the Effective Time and the valid termination of the Merger Agreement, such Investor shall not, directly or indirectly, unless (i) specifically requested by Parent in writing or (ii) expressly contemplated by the terms of this Agreement or the Merger Agreement:

(a)          sell, transfer, tender, pledge, encumber, assign or otherwise dispose of (collectively, a “Transfer”), or enter into any contract, option or other agreement with respect to, or consent to, a Transfer of, any or all of such Investor’s Investor Owned Shares; provided that this Section 3.1(a) shall not limit or preclude any Investor’s right to Transfer any Investor Owned Shares to any Permitted Transferee solely for estate planning or charitable purposes, provided that, (i) the Investor provides at least three Business Days advance written notice to Parent of such proposed transfer (including providing such other information and documentation related to the proposed Permitted Transferee as Parent may reasonably request), (ii) such Permitted Transferee agrees in a written agreement with Parent in form and substance satisfactory to Parent, in its reasonable discretion, to hold such Investor Owned Shares pursuant to, and to be bound by, the terms and conditions of this Agreement as an “Investor” hereunder, and to make each of the representations and warranties (which may be made in reliance upon a certificate from the Investor) hereunder in respect of the Investor Owned Shares transferred as such Investor shall have made hereunder and (iii) an opinion, in form and substance reasonably acceptable to Parent, of counsel that is knowledgeable in securities matters to the effect that such Transfer was made in accordance with applicable securities Laws and that this Agreement is binding upon and enforceable against such Permitted Transferee; provided, further, in the event that any proposed Permitted Transferee does not comply with the obligations imposed hereunder with respect to the Investor Owned Shares purported to be transferred to such Person, such transfer shall be deemed null and void ab initio;

(b)          acquire, offer to acquire, or agree to acquire, directly or indirectly, by purchase or otherwise, any assets of the Company or any Company Subsidiary;

(c)          make, or in any way participate in, directly or indirectly, any “solicitation” of “proxies” (as such terms are used in the rules of the Securities and Exchange Commission) to vote or consent to, or otherwise take any action intended to advise or influence any Person with respect to the voting of, or giving consent with respect to, any voting securities of the Company, other than in support of the Transaction and the Merger Agreement;

(c)          make any public announcement with respect to, or submit a proposal for, or offer for (with or without conditions) any extraordinary transaction involving the Company, any Company Subsidiary or their securities or assets;

(d)          form, join or in any way participate in a “group” (as defined in Section 13(d)(3) of the Exchange Act) in connection with any of the foregoing;

(e)          seek, in any way which may be reasonably likely to require, involve or trigger public disclosure of such request pursuant to applicable Law, to have any provision of this Section 3.1 amended, modified or waived; or

(f)          otherwise take, directly or indirectly, any actions with the purpose of avoiding or circumventing any provision of this Section 3.1 or which would reasonably be expected to have the effect of preventing, impeding, interfering with or adversely affecting the consummation of the Transaction or its ability to perform his, her or its obligations under this Agreement.

Any action taken in violation of the foregoing shall be null and void ab initio.

Section 3.2          Dividends, Distributions, Etc. in Respect of Investor Owned Shares; Additional Investor Owned Shares. In the event of a share dividend or share distribution, or any change in the shares of Common Stock by reason of any share dividend or share distribution, split-up, recapitalization, combination, exchange of shares or the like, the term “Investor Owned Shares” shall be deemed to refer to and include the Investor Owned Shares as well as all such share dividends and share distributions and any securities into which or for which any or all of the Investor Owned Shares may be changed or exchanged or which are received in such transaction. Each Investor hereby agrees, during the term of this Agreement, to promptly notify Parent of any new shares of Common Stock acquired by such Investor, if any, after the execution of this Agreement. Any such shares of Common Stock shall be subject to the terms of this Agreement as though owned by such Investor on the date of this Agreement.

Section 3.3           Competing Proposals in Respect of Investor Owned Shares.

(a)          Each Investor shall not, and shall use his, her or its reasonable best efforts to ensure that each of his, her or its Representatives and Affiliates do not, directly or indirectly: (i) solicit or initiate, or knowingly facilitate or encourage (including by way of providing information), any inquiries, proposals or offers that constitute, or that would reasonably be expected to lead to, a Takeover Proposal; (ii) participate in any negotiations regarding, or furnish to any person (other than Parent, the Company, any other Investor or any Representatives of such Investor, Parent, the Company or any other Investor) any nonpublic information with respect to, any Takeover Proposal; or (iii) engage in discussions with any Person (other than Parent, the Company, any other Investor or any Representatives of such Investor, Parent, the Company or any other Investor) with respect to any Takeover Proposal. Notwithstanding the foregoing, nothing in this Agreement shall prohibit an Investor (A) who is an officer or director of the Company from taking any action in the Investor’s capacity as an officer or director of the Company that is permitted to be taken by an officer or director of the Company under Section 4.02 of the Merger Agreement and (B) from engaging in discussions with a third party that the Company is permitted to engage in discussions with regarding a Takeover Proposal or Acquisition Transaction pursuant to Section 4.02(c) or 4.02(g) of the Merger Agreement regarding such Investor’s equity participation, investment or reinvestment in a Takeover Proposal or an Acquisition Transaction; provided that prior to the termination of this Agreement, no Investor will enter into any agreement with respect to any of the foregoing.

(b)         If any Investor, or any of his, her or its Representatives, at any time during the period beginning on the date hereof and ending on the valid termination of this Agreement, receives any bona fide Takeover Proposal (or any other inquiry regarding a potential Takeover Proposal) from a potential bidder or its Representatives, then such Investor shall promptly: (i) advise the Company and Parent in writing of such Takeover Proposal or inquiry (including the identity of the Person making or submitting such Takeover Proposal or inquiry and the material terms and conditions thereof); and (ii) provide the Company and Parent with copies of all documents and other written communications received by such Investor setting forth the terms and conditions of such Takeover Proposal or inquiry.

(c)          Each Investor shall, and shall ensure that each of his, her or its Representatives and Affiliates (if applicable), immediately terminate and cause to be terminated any existing solicitation by such Investor, his, her or its Representatives or Affiliates of, or discussions or negotiations between such Investor, his, her or its Representatives or Affiliates and, any Person relating to any Takeover Proposal, and such Investor shall be responsible for any breach of this Agreement by his, her or its Representatives or Affiliates.

(d)          Each Investor agrees that such Investor will promptly inform each of his, her or its Representatives and his, her or its Affiliates’ Representatives of the obligations undertaken in this Article III.

ARTICLE IV

REPRESENTATIONS AND WARRANTIES OF THE INVESTORS

Each Investor hereby severally and not jointly represents and warrants to Parent as follows:

Section 4.1           Binding Nature of Agreement.  This Agreement has been duly and validly executed and delivered by such Investor and, assuming that this Agreement constitutes the valid and binding agreement of Parent, constitutes the valid and binding agreement of such Investor, enforceable against such Investor in accordance with its terms, except that such enforceability may be limited by (i) bankruptcy, insolvency, reorganization, moratorium or other similar Laws now or hereafter in effect relating to creditors’ rights generally, and (ii) general principles of equity (regardless of whether enforceability is considered in a proceeding in equity or at law).

Section 4.2           Ownership of Shares.  As of the date hereof, such Investor beneficially owns the number of Investor Owned Shares set forth opposite the name of such Investor on Schedule I hereto under the heading “Investor Owned Shares”. Such Investor has the sole power to vote (or cause to be voted) such Investor Owned Shares and has good and valid title to such Investor Owned Shares, free and clear of any and all Liens, other than those created by this Agreement or restrictions on transfer arising under applicable securities Law. At the Contribution Closing, such Investor will transfer good and valid title to such Investor’s Investor Owned Shares, free and clear of all Liens, other than those created by this Agreement or restrictions on transfer arising under applicable securities Law.

Section 4.3           No Conflicts.  Neither the execution and delivery of this Agreement by such Investor, nor the consummation by such Investor of the transactions contemplated hereby, will result in, or give rise to, a violation or breach of or a default under any of the terms of any material contract, understanding, agreement or other instrument or obligation to which such Investor is a party or by which such Investor or any of such Investor’s Investor Owned Shares or such Investor’s assets may be bound, or (ii) violate any applicable Law, except, with respect to any of the foregoing clauses (i) and (ii), as does not and would not reasonably be expected to impair such Investor’s ability to perform his, her or its obligations under this Agreement.

Section 4.4           Investment Intent.   Each Investor is acquiring the Exchange Units for such Investor’s own account, for investment only, and not with a view to any resale or public distribution thereof. Each Investor agrees that such Investor will not offer to sell or otherwise dispose of the Exchange Units to be held by it in violation of any applicable Law. Each such Investor acknowledges that (a) the Exchange Units have not been registered under the Securities Act, or any state or foreign securities Laws, (b) there is no public market for the Exchange Units and there can be no assurance that a public market shall develop, (c) the Exchange Units are subject to the restrictions on transfer set forth in the Limited Partnership Agreement and (d) such Investor must bear the economic risk of its investment in the Exchange Units to be held by it for an indefinite period of time. Each Investor has all requisite legal power and authority to acquire the Exchange Units in accordance with the terms of this Agreement and is an “accredited investor” within the meaning of the Rule 501 promulgated under the Securities Act. Such Investor has been given the opportunity to consult with independent legal counsel regarding such Investor’s rights and obligations under the Limited Partnership Agreement, has read and fully understands the terms and conditions contained in the Limited Partnership Agreement, and intends for such terms to be binding and enforceable upon such Investor.

Section 4.5           Enforceability Against Spouses.  If such Investor is a married individual and such Investor’s Investor Owned Shares constitute community property or otherwise require spousal approval in order for this Agreement to be a legally valid and binding obligation of such Investor, this Agreement has been duly executed and delivered by Investor’s spouse and constitutes a legally valid and binding obligation of such Investor’s spouse, enforceable against such Investor’s spouse in accordance with its terms, except that such enforceability may be limited by (i) bankruptcy, insolvency, reorganization, moratorium or other similar Laws now or hereafter in effect relating to creditors’ rights generally, and (ii) general principles of equity (regardless of whether enforceability is considered in a proceeding in equity or at law).

Section 4.6           Reliance by Parent.  Such Investor understands and acknowledges that Parent is entering into the Merger Agreement in reliance upon such Investor’s execution and delivery of this Agreement and the representations and warranties of such Investor contained herein. Such Investor understands and acknowledges that the Merger Agreement governs the terms of the Merger and the Transaction.

Each Investor that is a non-natural person further severally and not jointly represents and warrants to Parent as follows:

Section 4.7           Due Organization.  Such Investor is duly organized, validly existing and in good standing under the Laws of its jurisdiction of formation.

Section 4.8           Authority Relative to This Agreement.  Such Investor has the requisite power and authority to execute and deliver this Agreement and to consummate the transactions contemplated hereby. This Agreement and the consummation by such Investor of the transactions contemplated hereby have been duly and validly authorized by the board of directors, general partner or similar governing body of such Investor, and no other corporate proceedings on the part of such Investor are necessary to authorize this Agreement or to consummate the transactions contemplated hereby.

Section 4.9           No Conflicts.  Neither the execution and delivery of this Agreement by such Investor, nor the consummation by such Investor of the transactions contemplated hereby, will conflict with or result in any breach of the organizational documents of such Investor.

ARTICLE V
REPRESENTATION AND WARRANTIES OF PARENT

Parent hereby represents and warrants to the Investors as follows:

Section 5.1           Due Organization.  Parent is a limited partnership duly organized, validly existing and in good standing under the Laws of the State of Delaware.

Section 5.2          Authority Relative to this Agreement.  Parent has the requisite limited partnership power and authority to execute and deliver this Agreement and to consummate the transactions contemplated hereby. This Agreement and the consummation by Parent of the transactions contemplated hereby have been duly and validly authorized by the general partner of Parent, and no other limited partnership proceedings on the part of Parent are necessary to authorize this Agreement or to consummate the transactions contemplated hereby. This Agreement has been duly and validly executed and delivered by Parent and, assuming that this Agreement constitutes the valid and binding agreement of the Investors, constitutes the valid and binding agreement of Parent, enforceable against Parent in accordance with its terms, except that such enforceability may be limited by (i) bankruptcy, insolvency, reorganization, moratorium or other similar Laws now or hereafter in effect relating to creditors’ rights generally, and (ii) general principles of equity (regardless of whether enforceability is considered in a proceeding in equity or at law).

Section 5.3          No Conflicts.  Neither the execution and delivery of this Agreement by Parent, nor the consummation by Parent of the transactions contemplated hereby, will (i) conflict with or result in any breach of the governing documents of Parent; (ii) require any Permit from any Governmental Authority; (iii) result in, or give rise to, a violation or breach of or a default under any of the terms of any material contract, understanding, agreement or other instrument or obligation to which Parent is a party, or (iv) violate any applicable Law, except, with respect to any of the foregoing clauses (i) through (iv), as does not and could not reasonably be expected to impair Parent’s ability to perform its obligations under this Agreement.

Section 5.4          Valid Issuance of Exchange Units.   Assuming the truth and accuracy of the representations and warranties set forth in Section 4.4, when issued and delivered on the Contribution Closing Date, the Exchange Units shall be validly issued and fully paid and shall have been issued in compliance with the Securities Act and applicable state securities Laws.

ARTICLE vi 

termination

Section 6.1           Termination.

(a)          Subject to Section 6.1(b), this Agreement shall terminate (except for Article VI and Article VII, which shall survive such termination), without further action by any of the parties hereto, and none of Parent or any of the Investors shall have any rights or obligations under this Agreement, immediately upon the earliest to occur of: (i) the termination of this Agreement by mutual written consent of Parent and each Investor, (ii) the termination of the Merger Agreement in accordance with its terms (provided, however, that each Investor’s obligations under Section 2.2(a)(iii) and Section 3.3 shall survive for 18 months following any termination of the Merger Agreement by Parent pursuant to Section 7.01(c)(ii) of the Merger Agreement as a result of the Board effecting a Company Adverse Recommendation Change resulting from an Intervening Event) and (iii) the Effective Time of the Merger.

(b)          Notwithstanding Section 6.1(a), termination of this Agreement shall not prevent any party hereunder from seeking any remedies (at law or in equity) against any other party hereto for such party’s breach of any of the terms of this Agreement prior to the termination of this Agreement.

ARTICLE vii

MISCELLANEOUS PROVISIONS

Section 7.1           Dissenters’ Rights.  To the extent permitted by applicable Law, each Investor hereby waives and agrees not to exercise any rights to dissent from the Transaction that he, she or it may have under applicable Law.

Section 7.2           Further Actions. Each of the Parties agrees to use reasonable best efforts to do all things reasonably necessary to effectuate this Agreement.

Section 7.3           Waivers.  No failure on the part of any party to exercise any power, right, privilege or remedy under this Agreement, and no delay on the part of any party in exercising any power, right, privilege or remedy under this Agreement, shall operate as a waiver of such power, right, privilege or remedy; and no single or partial exercise of any such power, right, privilege or remedy shall preclude any other or further exercise thereof or of any other power, right, privilege or remedy. No party shall be deemed to have waived any claim arising out of this Agreement, or any power, right, privilege or remedy under this Agreement, unless the waiver of such claim, power, right, privilege or remedy is expressly set forth in a written instrument duly executed and delivered on behalf of such party; and any such waiver shall not be applicable or have any effect except in the specific instance in which it is given.

Section 7.4           Counterparts.   This Agreement may be executed and delivered (including by facsimile transmission or by e-mail of a .pdf attachment) in two or more counterparts, and by the different parties hereto in separate counterparts, each of which when executed and delivered shall be deemed to be an original but all of which taken together shall constitute one and the same agreement.

Section 7.5           GOVERNING LAW.  THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF GEORGIA, REGARDLESS OF THE LAWS THAT MIGHT OTHERWISE GOVERN UNDER APPLICABLE PRINCIPLES OF CONFLICTS OF LAWS THEREOF.

Section 7.6           Venue and Exclusive Jurisdiction.  Each of the Parties (a) consents to submit itself to the exclusive personal jurisdiction of the federal and state courts located in the State of Georgia situated in Fulton County, in the event any dispute arises out of this Agreement, (b) agrees that he, she or it will not attempt to deny or defeat such personal jurisdiction by motion or other request for leave from any such court and (c) agrees that he, she or it will not bring any action relating to this Agreement in any court other than the federal and state courts located in the State of Georgia situated in Fulton County. Each Party hereby (i) consents to service of process in any action between the parties arising in whole or in part under or in connection with this Agreement in any manner permitted by Georgia Law, (ii) agrees that service of process made in accordance with clause (i) or made by registered or certified mail, return receipt requested, at its address specified on the first page of this Agreement, will constitute good and valid service of process in any such action, and (iii) waives and agrees not to assert (by way of motion, as a defense, or otherwise) in any such action any claim that service of process made in accordance with clause (i) or (ii) does not constitute good and valid service of process.

Section 7.7           Waiver of Jury Trial.   Each Party hereby unconditionally and irrevocably waives, to the fullest extent permitted by applicable Law, any right it may have to a trial by jury in respect of any Proceeding arising out of this Agreement. Each party hereto certifies and acknowledges that (a) no representative, agent or attorney of any other Party has represented, expressly or otherwise, that such other Party would not, in the event of any action, suit or proceeding, seek to enforce the foregoing waiver in the event of a legal action, (b) such {arty has considered the implications of this waiver, (c) such party makes this waiver voluntarily and (d) such {arty has been induced to enter into this Agreement, by, among other things, the mutual waiver and certifications in this Section 7.7.

Section 7.8           Notices.  Any notice required to be given hereunder shall be sufficient if in writing, and sent by facsimile transmission or e-mail of a .pdf attachment (provided that any notice received by facsimile or e-mail transmission or otherwise at the addressee’s location on any Business Day after 5:00 p.m. (addressee’s local time) shall be deemed to have been received at 9:00 a.m. (addressee’s local time) on the next Business Day), by reliable overnight delivery service (with proof of service), hand delivery or certified or registered mail (return receipt requested and first-class postage prepaid), addressed as follows (or at such other address for a party as shall be specified in a notice given in accordance with this Section 7.8):

If to Parent to:
c/o Sterling Fund Management, LLC
401 North Michigan Avenue, Suite 3300
Chicago, Illinois 60611
Attention: Office of General Counsel
Facsimile No.: (312) 465-7001 Email: aepstein@sterlingpartners.com
with a copy to:
Katten Muchin Rosenman LLP
525 West Monroe Street
Chicago, Illinois 60661
Attention:	Saul Rudo, Esq. Jeffrey R. Patt, Esq.
Facsimile No. (312) 577-8870
Email:	saul.rudo@kattenlaw.com jeffrey.patt@kattenlaw.com
If to any Investor, to:
Scott D. Dorfman
6465 East Johns Crossing, Suite 400 Johns Crossing, GA 30097
Facsimile No.: Email:  sdorfman@innotrac.com
with a copy to:
Ledbetter Wanamaker Glass LLP
1201 Peachtree St., Suite 1501
Atlanta, Georgia 30361
Attention: Bruce D. Wanamaker, Esq.
Facsimile No.: (404) 835-9540 Email: bwanamaker@lwglaw.com

Section 7.9           Entire Agreement.   This Agreement constitutes the entire agreement and supersedes all prior agreements and understandings, both written and oral, or among the Parties with respect to the subject matter hereof. This Agreement shall be binding upon, and shall be enforceable by and inure solely to the benefit of, the Parties and their respective successors and permitted assigns; provided, however, that neither this Agreement nor any of the Parties’ rights, interests or obligations hereunder may be assigned or delegated, in whole or in part, by operation of law or otherwise, without the prior written consent of the other Parties, and any attempted assignment or delegation of this Agreement or any of such rights, interests or obligations by any Party without the other Parties’ prior written consent shall be void and of no effect; provided, however, that Parent may assign this Agreement to an Affiliate thereof; provided that, upon such assignment, Parent shall remain jointly and severally liable with its applicable Affiliate to the Investors for performing all of its obligations hereunder. Nothing in this Agreement, express or implied, is intended to or shall confer upon any Person (other than the Parties) any right, benefit or remedy of any nature. This Agreement is intended to create a contractual relationship between the Investors, on the one hand, and Parent, on the other hand, and is not intended to create, and does not create, any agency, partnership, joint venture or any like relationship among the Parties. Without limiting the generality of the foregoing, none of the Investors nor Parent, by entering into this Agreement, intends to form a “group” for purposes of Rule 13d-5(b)(1) of the Exchange Act or any other similar provision of applicable Law with Parent or any other shareholder of the Company.

Section 7.10         Severability. If any term or provision of this Agreement is held by a court of competent jurisdiction or Governmental Entity to be invalid, void or unenforceable in any situation in any jurisdiction, such holding shall not affect the validity or enforceability of the remaining terms and provisions of this Agreement or the validity or enforceability or application of the invalid or unenforceable term or provision in any other situation or in any other jurisdiction. If a final judgment of a court of competent jurisdiction declares that any term or provision of this Agreement is invalid or unenforceable, the Parties agree that the court making such determination shall have the power to limit such term or provision, to delete specific words or phrases or to replace such term or provision with a suitable and equitable term or provision that is valid and enforceable and that comes closest to expressing the intention of the invalid or unenforceable term or provision, and this Agreement shall be valid and enforceable as so modified. In the event such court does not exercise the power granted to it in the prior sentence, the Parties agree to replace such invalid or unenforceable term or provision with a valid and enforceable term or provision that will achieve, to the extent possible, the economic, business and other purposes of such invalid or unenforceable term or provision.

Section 7.11         Certain Interpretations. For purposes of this Agreement:

(a)          Unless otherwise specified, all references in this Agreement to Articles and Sections shall be deemed to refer to Articles and Sections of this Agreement.

(b)          The Article and Section captions herein are for convenience of reference only, do not constitute part of this Agreement and shall not be deemed to limit or otherwise affect any of the provisions hereof.

(c)          Unless the context otherwise requires, words describing the singular number shall include the plural and vice versa, and words denoting any gender shall include all genders.

(d)          The words “include,” “includes” and “including,” when used herein shall be deemed in each case to be followed by the words “without limitation.”

(e)          The Parties agree that they have been represented by legal counsel during the negotiation and execution of this Agreement and, therefore, waive the application of any Law or rule of construction providing that ambiguities in an agreement or other document shall be construed against the Party drafting such agreement or document.

(f)          “Affiliate” means, with respect to any specified Person, any Person that directly, or indirectly through one or more intermediaries, controls, or is controlled by, or is under common control with, the Person specified.

(g)          “Permitted Transferee” means, with respect to any Investor (including any Permitted Transferee), any other Investor, any immediate family member of any Investor, any trust, partnership, corporation, limited liability company or other entity of which the beneficiaries or beneficial owners, as the case may be, are Investors or Permitted Transferees, a trust or other entity for the benefit of any Person that is qualified as a charitable organization under Section 501(c)(3) of the Code, or a family foundation established by or on behalf of one or more of the Investors for the purpose of making charitable gifts or donations to Persons that are qualified as charitable organizations under Section 501(c)(3) of the Code.

(h)          “Representative” means, with respect to any Person, any director, officer, other employee, accountant, consultant, legal counsel, financial advisor, agent or other representative of such Person.

Section 7.12         Fees and Expenses.  Upon the consummation of the Merger, the Company will reimburse Investors for up to an aggregate of $30,000 of the reasonable and documented out-of-pocket expenses incurred by Investors in connection with the negotiation and preparation of this Agreement and the consummation of the transactions contemplated hereby.

Section 7.13         Ownership Interest. Nothing contained in this Agreement shall be deemed to vest in Parent any direct or indirect ownership or incidence of ownership of or with respect to any Investor Owned Shares. All rights, ownership and economic benefits of and relating to the Investor Owned Shares shall remain vested in and belong to the Investors, and Parent shall have no authority to direct the Investors in the voting or disposition of any of the Investor Owned Shares, except as otherwise provided in this Agreement.

[Signature Page Follows]

IN WITNESS WHEREOF, the Parties have caused this Agreement to be duly executed, as of the date first above written.

PARENT:
BLUE EAGLE HOLDINGS, L.P.
By:	/s/ Merrick Elfman
Name: Merrick Elfman
Title: President
INVESTOR:

/s/ Scott D. Dorfman

Scott D. Dorfman, individually, and as Custodian for Jesse Dorfman, Cory Dorfman and Joan Dorfman under the Georgia Uniform Transfer to Minors Act

Address: [REDACTED]

[REDACTED]

Facsimile:

INVESTOR:

/s/ Susan Mary Trotochaud

Susan Mary Trotochaud, individually, and as Custodian for Bradley Dorfman, Brent Dorfman and Jesse Dorfman under the Georgia Uniform Transfer to Minors Act

Address: [REDACTED]

[REDACTED]

Facsimile:

INVESTOR:

/s/ Larry Dorfman

Larry Dorfman, as Trustee for Bradley Dorfman, Brent Dorfman and Jesse Dorfman Accumulation Trusts

Address: [REDACTED]

[REDACTED]

Facsimile:

Spousal Consent to Contribution and Support Agreement

The undersigned (a) understands that, pursuant to the provisions of the Contribution and Support Agreement (the “Agreement”) to which this Spousal Consent is attached, Susan Mary Trotochaud has agreed not to tender the Investor Owned Shares in the Offer and, upon the terms and subject to the conditions of the Agreement, to contribute and deliver to Parent all of the Investor Owned Shares, (b) understands that she may have a community property or other interest in such Investor Owned Shares, and (c) consents to such non-tender provisions and the Contribution and agrees to be bound by each and every provision of the Agreement. Capitalized terms used in this Spousal Consent and not otherwise defined herein shall have the meanings ascribed to them in the Agreement.

/s/ Susan Mary Trotochaud

Susan Mary Trotochaud

Schedule I

	Investor Owned Shares		Aggregate Fair Market Value of Investor Owned Shares		Exchange Units		Purchased Units
Scott D. Dorfman		5,673,429	$	46,522,117.80		46,522.12		31,948.61
Scott D. Dorfman, as Custodian for Jesse Dorfman, under the Georgia Uniform Transfer to Minors Act		6,000	$	49,200.00		49.20		33.79
Scott D. Dorfman, as Custodian for Cory Dorfman under the Georgia Uniform Transfer to Minors Act		6,000	$	49,200.00		49.20		33.79
Scott D. Dorfman, as Custodian for Joan Dorfman under the Georgia Uniform Transfer to Minors Act		6,000	$	49,200.00		49.20		33.79
Susan Mary Trotochaud		415	$	3,403.00		3.40		2.34
Susan Mary Trotochaud, as Custodian for Bradley Dorfman under the Georgia Uniform Transfer to Minors Act		21,428	$	175,709.60		175.71		120.67
Susan Mary Trotochaud, as Custodian for Brent Dorfman under the Georgia Uniform Transfer to Minors Act		21,428	$	175,709.60		175.71		120.67

	Investor Owned Shares		Aggregate Fair Market Value of Investor Owned Shares		Exchange Units		Purchased Units
Susan Mary Trotochaud, as Custodian for Jesse Dorfman under the Georgia Uniform Transfer to Minors Act		21,428	$	175,709.60		175.71		120.67
Larry I. Dorfman as Trustee for Bradley Dorfman Accumulation Trust		27,778	$	227,779.60		227.78		156.43
Larry I. Dorfman as Trustee for Brent Dorfman Accumulation Trust		27,778	$	227,779.60		227.78		156.43
Larry I. Dorfman as Trustee for Jesse Dorfman Accumulation Trust		27,778	$	227,779.60		227.78		156.43

FORM OF
UNIT PURCHASE AGREEMENT

THIS UNIT PURCHASE AGREEMENT (this “Agreement”) is made as of [________], 2014, by and among Sterling Capital Partners IV, L.P., a Delaware limited partnership (“SCP IV”), SCP IV Parallel, L.P. (“Parallel” and, together with SCP IV, the “Purchasers”), and the Person listed on Schedule I hereto as the “Seller” (the “Seller”).

A.           On November 14, 2013, Blue Eagle Holdings, L.P., a Delaware limited partnership (“Parent”), Blue Eagle Acquisition Sub, Inc., a Georgia corporation and wholly-owned subsidiary of Parent (“Purchaser”), and Innotrac Corporation, a Georgia corporation (the “Company”) entered into an Agreement and Plan of Merger.

B.           Immediately prior to the execution and delivery of this Agreement, pursuant to the terms set forth in the Merger Agreement, Purchaser accepted for payment all shares of common stock, par value $0.10 of the Company (the “Common Stock”), validly tendered pursuant to the Offer (as defined in the Merger Agreement).

C.           Immediately following the consummation of the Offer, but prior to the execution and delivery of this Agreement, the Seller contributed to Parent shares of Common Stock in exchange for the number of preferred units in Parent (the “Preferred Units”) set forth opposite the Seller’s name on Schedule I hereto under the heading “Exchange Units” (the “Exchange Units”).

D.           Each Purchaser desires to purchase from the Seller, and the Seller desires to sell to the such Purchaser, the number of Exchange Units set forth opposite such Purchaser’s name on Schedule II hereto under the heading “Sale Units” (the “Sale Units”).

NOW THEREFORE, in consideration of the mutual promises made herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto, intending to be legally bound, agree as follows:

Section 1.          Purchase and Sale.

1A.        Purchase and Sale.   The Seller hereby sells, transfers and delivers to each Purchaser, and such Purchaser hereby accepts from the Seller, the number of Sale Units set forth opposite such Purchaser’s name on Schedule II hereto under the heading “Sale Units.” In consideration for the sale, transfer and delivery of such Sale Units, each Purchaser shall pay to the Seller, simultaneous with the execution and delivery of this Agreement, an amount in cash set forth opposite such Purchaser’s name on Schedule II hereto under the heading “Purchase Price” by wire transfer of immediately available funds.

1B.         Representations and Warranties of Purchasers.   Each of the Purchasers represents and warrants for itself that:

(a)          Binding Nature of Agreement.   This Agreement has been duly and validly executed and delivered by such Purchaser and, assuming that this Agreement constitutes the valid and binding agreement of the Seller, constitutes the valid and binding agreement of such Purchaser, enforceable against such Purchaser in accordance with its terms, except that such enforceability may be limited by (i) bankruptcy, insolvency, reorganization, moratorium or other similar laws now or hereafter in effect relating to creditors’ rights generally, and (ii) general principles of equity (regardless of whether enforceability is considered in a proceeding in equity or at law).

(b)          No Conflicts. Neither the execution and delivery of this Agreement by such Purchaser, nor the consummation by such Purchaser of the transactions contemplated hereby, will result in, or give rise to, a violation or breach of or a default under any of the terms of any of the organizational documents of the Purchaser or any material contract, understanding, agreement or other instrument or obligation to which such Purchaser is a party or by which such Purchaser or its assets may be bound, or (ii) violate any applicable law, except, with respect to any of the foregoing clauses (i) and (ii), as does not and would not reasonably be expected to impair such Purchaser’s ability to perform its obligations under this Agreement.

(c)          Investment Intent.   Each Purchaser is acquiring the Sale Units for such Purchaser’s own account, for investment only, and not with a view to any resale or public distribution thereof. Each Purchaser agrees that such Purchaser will not offer to sell or otherwise dispose of the Sale Units to be held by it in violation of any applicable law. Each Purchaser acknowledges that (i) the Sale Units have not been registered under the Securities Act of 1933 (the “Securities Act”), or any state or foreign securities laws, (ii) there is no public market for the Sale Units and there can be no assurance that a public market shall develop, (iii) the Sale Units are subject to the restrictions on transfer set forth in the Amended and Restated Limited Partnership Agreement of Parent, dated as of the date hereof, as such agreement may be amended from time to time (the “Limited Partnership Agreement”), and (iv) such Purchaser must bear the economic risk of its investment in the Sale Units to be held by it for an indefinite period of time. Each Purchaser has all requisite legal power and authority to acquire the Sale Units in accordance with the terms of this Agreement and is an “accredited investor” within the meaning of the Rule 501 promulgated under the Securities Act. Such Purchaser has been given the opportunity to consult with independent legal counsel regarding such Purchaser’s rights and obligations under the Limited Partnership Agreement, has read and fully understands the terms and conditions contained in the Limited Partnership Agreement, and intends for such terms to be binding and enforceable upon such Purchaser.

(d)          Due Organization. Such Purchaser is duly organized, validly existing and in good standing under the laws of its jurisdiction of formation.

(e)          Authority Relative to this Agreement. Such Purchaser has the requisite power and authority to execute and deliver this Agreement and to consummate the transactions contemplated hereby. This Agreement and the consummation by such Purchaser of the transactions contemplated hereby have been duly and validly authorized by the general partner of such Purchaser, and no other partnership proceedings on the part of such Purchaser are necessary to authorize this Agreement or to consummate the transactions contemplated hereby.

Section 2.          Representations and Warranties of the Seller.

The Seller represents and warrants to each Purchaser as follows:

(a)          Ownership of Sale Units. The Seller is the record and beneficial owner of the Sale Units free and clear of all liens, other than those created by this Agreement or restrictions on transfer arising under applicable securities law.

(b)          Authority Relative to this Agreement. The Seller has the requisite capacity to execute and deliver this Agreement and to consummate the transactions contemplated hereby. To the extent that the Seller is not a natural person, this Agreement and the consummation by the Seller of the transactions contemplated hereby have been duly and validly authorized by the governing body of the Seller, and no other proceedings on the part of the Seller are necessary to authorize this Agreement or to consummate the transactions contemplated hereby. This Agreement has been duly and validly executed and delivered by the Seller and, assuming that this Agreement constitutes the valid and binding agreement of the Purchasers, constitutes the valid and binding agreement of the Seller, enforceable against the Seller in accordance with its terms, except that such enforceability may be limited by (i) bankruptcy, insolvency, reorganization, moratorium or other similar laws now or hereafter in effect relating to creditors’ rights generally, and (ii) general principles of equity (regardless of whether enforceability is considered in a proceeding in equity or at law).

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(c)          No Conflicts. Neither the execution and delivery of this Agreement by the Seller, nor the consummation by the Seller of the transactions contemplated hereby, will result in, or give rise to, a violation or breach of or a default under any of the terms of any of the organizational documents of the Seller (if the Seller is not a natural person) or any material contract, understanding, agreement or other instrument or obligation to which the Seller is a party or by which the Seller or its assets may be bound, or (ii) violate any applicable law, except, with respect to any of the foregoing clauses (i) and (ii), as does not and would not reasonably be expected to impair the Seller’s ability to perform his, her or its obligations under this Agreement.

Section 3.          Miscellaneous.

3A.        Consent to Amendments.  Except as otherwise expressly provided herein, no amendment, modification or waiver of any of the provisions of this Agreement shall be effective against any party hereto unless such party has consented to such amendment, modification or waiver in writing. No course of dealing between the Seller and the Purchasers or any delay in exercising any rights hereunder shall operate as a waiver of any rights.

3B.         Survival of Representations and Warranties.   All representations and warranties contained herein shall survive the execution and delivery of this Agreement and the consummation of the transactions contemplated hereby.

3C.         Successors and Assigns.   Except as otherwise expressly provided herein, all covenants and agreements contained in this Agreement by or on behalf of any of the parties hereto shall bind and inure to the benefit of the respective successors and permitted assigns of the parties hereto, whether so expressed or not, provided, however, that none of the parties hereto shall assign this Agreement without the prior written consent of the other parties hereto.

3D.         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 is 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 this Agreement.

3E.          Counterparts.   This Agreement may be executed simultaneously in two or more counterparts, any one of which need not contain the signatures of more than one party, but all such counterparts taken together shall constitute one and the same agreement.

3F.          Descriptive Headings; Interpretation; No Strict Construction.  The descriptive headings of this Agreement are inserted for convenience only and do not constitute a substantive part of this Agreement. Whenever required by the context, any pronoun used in this Agreement shall include the corresponding masculine, feminine or neuter forms, and the singular forms of nouns, pronouns, and verbs shall include the plural and vice versa. Reference to any agreement, document, or instrument means such agreement, document, or instrument as amended or otherwise modified from time to time in accordance with the terms thereof. The use of the words “include” or “including” in this Agreement shall be by way of example rather than by limitation. The use of the words “or,” “either” or “any” shall not be exclusive. The parties hereto have participated jointly in the negotiation and drafting of this Agreement. In the event an ambiguity or question of intent or interpretation arises, this Agreement shall be construed as if drafted jointly by the parties hereto, and no presumption or burden of proof shall arise favoring or disfavoring any party by virtue of the authorship of any of the provisions of this Agreement.

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3G.         Governing Law.  All issues and questions concerning the construction, validity, enforcement and interpretation of this Agreement and the exhibits and schedules hereto shall be governed by, and construed in accordance with, the laws of the State of Delaware, without giving effect to any choice of law or conflict of law rules or provisions (whether of the State of Delaware or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of Delaware.

3I.           Notices.  All notices, demands or other communications to be given or delivered under or by reason of the provisions of this Agreement shall be made as set forth in the Limited Partnership Agreement.

*        *        *        *         *        *

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IN WITNESS WHEREOF, the parties hereto have executed this Unit Purchase Agreement as of the day and year first above written.

[SELLER]

By:

Name:

Title:

STERLING CAPITAL PARTNERS IV, L.P.

By:  SC PARTNERS IV, L.P., its General Partner

By:  Sterling Partners IV, LLC, its General Partner

By:

Name:

Title:

SCP IV PARALLEL, L.P.

By:  SC PARTNERS IV, L.P., its General Partner

By:  Sterling Partners IV, LLC, its General Partner

By:

Name:

Title:

SCHEDULE I

Seller Exchange Units

SCHEDULE I

Purchaser	Sale Units	Purchase Price
Sterling Capital Partners IV, L.P.
SCP IV Parallel, L.P.

FORM OF
AMENDED AND RESTATED
LIMITED PARTNERSHIP AGREEMENT
OF
BLUE EAGLE HOLDINGS, L.P.

This AMENDED AND RESTATED LIMITED PARTNERSHIP AGREEMENT of Blue Eagle Holdings, L.P. (this “Agreement”) is effective as of [_________], 2014 (the “Effective Date”), by and among the General Partner (as hereinafter defined) and the persons set forth as Limited Partners (as hereinafter defined) on Exhibit A attached hereto and made a part hereof.

WHEREAS, Blue Eagle Holdings, L.P. (the “Partnership”) was formed by the filing of a certificate of limited partnership filed with the Secretary of State of the State of Delaware on November 8, 2013 (the “Certificate of Limited Partnership”).

WHEREAS, the General Partner is party to that certain Limited Partnership Agreement of the Partnership, dated as of November 8, 2013 (the “Existing Limited Partnership Agreement”).

WHEREAS, effective as of the Effective Date and in connection with or as a result of the closing of the transactions contemplated by the Merger Agreement (as defined below): (i) the General Partner, SCP (as defined below), SCP Parallel (as defined below) and the Rollover Securityholders (as defined below) acquired Preferred Units (as defined below), and (ii) the Partnership acquired, directly or indirectly, all of the shares of capital stock of Innotrac Corporation, a Georgia corporation (the “Company”).

WHEREAS, the General Partner desires to amend and restate the Existing Limited Partnership Agreement on the terms set forth herein.

WHEREAS, the Limited Partners desire to enter into this Agreement which sets forth, among other things, the governance of the Partnership, the respective ownership interests of the Partners and the relationship of the parties thereto.

NOW, THEREFORE, in consideration of the foregoing premises and the mutual covenants and agreements set forth herein, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

Article I
Defined Terms

In addition to the capitalized terms defined throughout this Agreement, the following capitalized terms shall have the meanings specified in this Article I.

“Act” means the Delaware Revised Uniform Limited Partnership Act, as amended from time to time (or any corresponding provisions of succeeding law).

“Additional Partners” means the Persons admitted as additional Partners in accordance with Section 3.2(a).

“Additional Securities” means any Units or other equity interests in the Partnership or any of its Subsidiaries, or Convertible Securities, whether now authorized or not, issued pursuant to a sale transaction or series of sales transactions, where (A) such sales are made solely for cash delivered in immediately available funds, (B) the proceeds of such sales are to be used to finance the ongoing operations of the Partnership and/or its Subsidiaries, and (C) the opportunity to participate in such sales is offered primarily to Persons other than Service Partners; provided that, for the avoidance of confusion, the term “Additional Securities” does not include any (i) Convertible Securities issued to employees, directors, independent contractors or consultants of the Partnership or any of its Subsidiaries pursuant to the Option Plan and Units or other equity interests of the Partnership or any of its Subsidiaries issued upon exercise of such options or exercise or conversion or exchange of such other Convertible Securities, (ii) Units or other equity interests of the Partnership or any of its Subsidiaries issued to employees, directors, independent contractors or consultants of the Partnership or any of its Subsidiaries pursuant to exercise of options issued under the Option Plan, (iii) Units or other equity interests of the Partnership or any of its Subsidiaries issued upon exercise, conversion or exchange of any Convertible Securities pursuant to their terms, (iv) Units or other equity interests of the Partnership or any of its Subsidiaries, or Convertible Securities issued in connection with any acquisition by the Partnership or any of its Subsidiaries of any shares of capital stock or assets of any Person, or any merger, consolidation or reorganization involving the Partnership or any of its Subsidiaries, (v) Units or other equity interests of the Partnership or any of its Subsidiaries issued pursuant to a public offering that is registered under the Securities Act, (vi) Units or other equity securities of the Partnership or any of its Subsidiaries, or Convertible Securities issued in connection with a stock split or other subdivision of, or as a dividend or other distribution with respect to, the Units or other equity interests, (vii) Units or other equity interests of the Partnership or any of its Subsidiaries, or Convertible Securities issued in connection with strategic alliances, joint ventures, financing arrangements, third party credit arrangements or other partnering arrangements on behalf of the Partnership or any of its Subsidiaries authorized by the General Partner, or (viii) Units or other equity interests of the Partnership or any of its Subsidiaries issued to any Service Providers of the Partnership or its Affiliates in exchange for capital contributions made by such Persons to the Partnership or any of its Subsidiaries on such terms as determined by the General Partner.

“Adjusted Capital Account Deficit” means, with respect to any Partner, the deficit balance, if any, in such Partner’s Capital Account as of the end of the relevant taxable year or other period, after giving effect to the following adjustments:

(a)          credit such Capital Account by any amounts which such Partner is obligated to restore pursuant to this Agreement (including any note obligations) or is deemed to be obligated to restore pursuant to the penultimate sentence of each of Regulations Sections 1.704-2(i)(5) and 1.704-2(g); and

(b)          debit such Capital Account by the items described in Regulations Section 1.704-1(b)(2)(ii)(d)(4), (5) and (6).

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The foregoing definition of Adjusted Capital Account Deficit is intended to comply with the provisions of Regulations Section 1.704-1(b)(2)(ii)(d) and shall be interpreted consistently therewith.

“Affiliate” of, or a Person “Affiliated” with, a specified Person means a Person that directly, or indirectly through one or more intermediaries, controls, or is controlled by, or is under common control with, the Person specified; provided that, for the purposes of this definition, “control” (including, with correlative meanings, the terms “controlled by” and “under common control with”), as used with respect to any Person, shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of such Person, whether through the ownership of voting securities or by contract or otherwise. Without limiting the foregoing, the ownership of ten percent (10%) or more of the voting securities of a Person shall be deemed to constitute control.

“Agreement” means this Limited Partnership Agreement, as amended, modified, supplemented or restated from time to time in accordance with its terms.

“Applicable Federal Rate” means, as of any date, the applicable federal rate of interest as determined under Section 1274(d) of the Code in effect as of such date.

“Assumed Tax Rate” means, with respect to a taxable year of the Partnership, the higher of the then applicable (i) the sum of the highest federal individual income tax rate and highest state and local individual income tax rate in the states in which the Partnership does business, and (ii) the sum of the highest federal corporate income tax rate and the highest state and local corporate income tax of any state in which the Partnership does business; provided, however, that the deductibility of the state income taxes for federal income tax purposes shall be taken into account.

“Available Cash” means all cash revenues, funds and proceeds received by the Partnership from any source, except for Capital Contributions, less the sum of (i) all payments of principal, interest and other amounts then due and payable on any indebtedness of the Partnership; (ii) all expenses and expenditures paid in cash by the Partnership; and (iii) reasonable working capital reserves (including for investments by the Partnership in new projects) and reasonable reserves for contingencies as determined by the General Partner or as otherwise required by GAAP.

“Business” the business of providing fulfillment services, order processing, call centers, customer care services, including e-commerce fulfillment or e-commerce return services, related software platform and application services and similar and related services, as well as other similar services that the Partnership and its Subsidiaries may be involved in, and, unless otherwise specifically provided in any unit option or similar agreement between the Partnership and a Service Partner, any other businesses in which the Partnership and/or its Subsidiaries are engaged in, or any planned business for which the Partnership and/or its Subsidiaries have taken affirmative steps toward engaging in, as of the time of the termination of such Service Partner’s employment with or engagement by the Partnership and/or its Subsidiaries.

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“Capital Account” means the account maintained by the Partnership for each Partner. If any Unit or interest in the Partnership is transferred pursuant to the terms hereof, the transferee shall succeed to the Capital Account of the transferor to the extent the Capital Account is attributable to the transferred Unit or interest in the Partnership. It is intended that the Capital Accounts of all Partners shall be maintained in compliance with the provisions of Regulation Section 1.704-1(b), and all provisions hereof relating to the maintenance of Capital Accounts shall be interpreted and applied in a manner consistent with that Regulation.

“Capital Contribution” means the total amount of cash and the Gross Asset Value of any other assets contributed to the Partnership by a Partner, net of liabilities assumed or to which the assets contributed are subject.

“Cause” means, with respect to a Service Partner:

(a)          if such Service Partner has an employment or similar agreement with Employer, the meaning assigned to such term in such employment or similar agreement (including after the termination thereof), and

(b)          in all other cases, such Service Partner’s termination of employment with or engagement by Employer, the occurrence of any of the following events: (i) such Service Partner’s gross negligence or willful misconduct in the performance of his duties to the Partnership hereunder or to Employer; (ii) the determination of the General Partner that such Service Partner has committed a felony or other crime causing harm to the Partnership or its Affiliates or any act constituting fraud with respect to the Partnership or any of its Affiliates; (iii) a breach by such Service Partner of any terms or condition of this Agreement, any employment agreement, equity grant agreement or a breach by such Service Partner of any of such Service Partner’s other obligation to the Partnership or any of its Affiliates; (iv) such Service Partner shall have refused to perform directives of the General Partner or any officer to whom such Person reports, or the board of directors of any Affiliate (or any officer of such Affiliate) that are consistent with the scope and nature of his duties and responsibilities as an employee or service provider of the Partnership or its Affiliates; (v) such Service Partner shall have engaged in the unlawful use (including being under the influence) or possession of illegal drugs; (vi) such Service Partner shall have refused, upon request by Employer (which request may be provided by Employer in Employer’s sole discretion at any time while such Service Partner is employed by Employer) to be screened or tested for drug use; (vii) such Service Partner shall have engaged in dishonesty during his or her hiring process; or (viii) such Service Partner shall have failed to disclose to the Partnership any conflict of interest. A Service Partner’s employment by Employer also shall be deemed terminated for Cause under subsection (b) of this definition if the Service Partner resigns from Employer and the General Partner determines in good faith that one or more of the events described above existed as of the time of such resignation.

The decision to terminate a Service Partner’s employment for Cause, or to take other action or to take no action in response to any occurrence or non-occurrence with respect to a Service Partner’s employment, shall be in the sole and exclusive discretion of General Partner.

“Code” means the United States Internal Revenue Code of 1986, as amended, or any corresponding provision of any succeeding law.

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“Common Limited Partner” means a Limited Partner holding Common Units.

“Common Unit” means an interest in the Profits and Losses and distributions of the Partnership as provided herein. The Common Units shall be non-voting.

“Common Unit Factor” means, with respect to the Common Units as of any determination date, the applicable Common Unit Percentage as of such determination date, multiplied by the quotient of (a) the number of issued and outstanding Common Units as of such determination date, divided by (b) the number of Common Units (whether issued or unissued).

“Common Unit Percentage” means, with respect to the Common Units, (i) ten percent (10%) as of the Effective Date, and (ii) as of any time after the Effective Date, such other percentage as determined by the General Partner.

“Convertible Securities” means rights, options or warrants to purchase equity interests in the Partnership or any of its Subsidiaries, and securities of any type whatsoever that are, or may become, convertible into or exchangeable for equity interests in the Partnership or any of its Subsidiaries.

“Depreciation” means, for each fiscal year, an amount equal to the depreciation, amortization, or other cost recovery deduction allowable with respect to assets for such fiscal year, except that if the Gross Asset Value of the assets differs from its adjusted basis for federal income tax purposes at the beginning of such fiscal year, Depreciation shall be an amount which bears the same ratio to such beginning Gross Asset Value as the federal income tax depreciation, amortization, or other cost recovery deduction for such fiscal year bears to such beginning adjusted tax basis; provided, however, that if the adjusted basis for federal income tax purposes of an asset at the beginning of such fiscal year is zero, Depreciation shall be determined with reference to such beginning Gross Asset Value using any reasonable method selected by the General Partner.

“Economic Interest” means a Partner’s or Economic Owner’s share of the Partnership’s Profits and Losses and distributions pursuant to this Agreement and the Act, but shall not include any right to participate in the management and affairs of the Partnership, the right to vote or otherwise participate in any decisions of the Partners, or any right to receive information concerning the Business and the Partnership.

“Economic Owner” means any owner of an Economic Interest who is not a Partner, but holds Units pursuant to a Transfer described in Section 7.2(d). An owner of an Economic Interest who is not a Partner shall not be deemed a “partner” (as the term is used in the Act) of the Partnership.

“Employer” means the Partnership or any of its Subsidiaries.

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“Fair Market Value” means, with respect to any Covered Units or other Units being purchased pursuant to Section 7.5 or Section 7.6, the fair market value of such Units, which amount shall be determined by the General Partner in good faith, in the exercise of its reasonable business judgment, without taking into account any minority interest or liquidity discounts, and subject; in the case of any Rollover Buyout Event, to the terms and conditions of Section 7.6. In the event that as of the time of exercise of the Partnership’s repurchase right pursuant to Section 7.5 or Section 7.6 (x) a capital raise by the Partnership is imminent, as determined by the General Partner in good faith, and/or any Convertible Securities are outstanding, then the General Partner, or appraiser, as applicable, shall be authorized to take into account when determining such Fair Market Value the effect of such capital raise or conversion of such Convertible Securities on the value of the Covered Units or other Units, or (y) a valuation of the Partnership and its assets has been undertaken within the past six months, then the General Partner, or appraiser, as applicable, shall be authorized to take into account when determining such Fair Market Value the results of such valuation.

“General Partner” means Blue Eagle GP, LLC, a Delaware limited liability company, and any additional or successor general partner admitted or designated in accordance with Section 5.1(b).

“General Partner Determined Cause Event” means, with respect to a Service Partner who is no longer engaged by or provides services to any Employer, a determination by the General Partner in good faith that such Service Partner has committed a felony or other crime causing harm to the Partnership or any of its Affiliates or any act constituting fraud with respect to the Partnership or any of its Affiliates.

“General Partner Determined Competition” means, with respect to a Service Partner, a determination by the General Partner in good faith that such Service Partner is competing or has competed with the Business as conducted by the Partnership and/or any of its Subsidiaries; provided, however, that such determination shall not be based solely on competition that was permissible under a Restrictive Covenant during the applicable duration thereof.

“Gross Asset Value” means, with respect to any asset, the asset’s adjusted basis for federal income tax purposes, except as follows:

(a)          The initial Gross Asset Value of any asset contributed by a Partner to the Partnership shall be the gross fair market value of such asset, as determined in accordance with this Agreement;

(b)          The Gross Asset Values of all Partnership Property shall be adjusted to equal the respective gross fair market values of such property, as determined by the General Partner, as of the following times: (i) the acquisition of an additional Economic Interest by any new or existing Partner in exchange for more than a de minimis Capital Contribution; (ii) the distribution by the Partnership to a Partner of more than a de minimis amount of Partnership Property as consideration for an Economic Interest; (iii) the liquidation of the Partnership within the meaning of Section 1.704-1(b)(2)(ii)(g) of the Regulations and (iv) the issuance of an Economic Interest to any Person as compensation for services provided to or on behalf of the Partnership; provided, however, that adjustments pursuant to clauses (i), (ii) and (iv) above shall be made only if the General Partner reasonably determines that such adjustments are necessary or appropriate to reflect the relative economic interests of the Partners in the Partnership;

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(c)          The Gross Asset Value of any Partnership Property distributed to any Partner shall be adjusted to equal the gross fair market value of such property on the date of distribution as determined by the distributee and the General Partner; and

(d)          The Gross Asset Values of Partnership assets shall be increased (or decreased) to reflect any adjustments to the adjusted basis of such assets pursuant to Section 734(b) or Section 743(b) of the Code, but only to the extent that such adjustments are taken into account in determining Capital Accounts pursuant to Section 1.704-1(b)(2)(iv)(m) of the Regulations; provided, however, that Gross Asset Values shall not be adjusted pursuant to this subsection (d) to the extent the General Partner determines that an adjustment pursuant to subsection (b) hereof is necessary or appropriate in connection with a transaction that would otherwise result in an adjustment pursuant to this subsection (d).

If the Gross Asset Value of an asset has been determined or adjusted pursuant to paragraph (a), (b), or (d) hereof, such Gross Asset Value shall thereafter be adjusted by the Depreciation taken into account with respect to such asset for purposes of computing Profits and Losses.

“Involuntary Withdrawal” means, with respect to a Partner, the occurrence of any of the following events:

(a)          the Partner (i) makes a general assignment for the benefit of creditors; (ii) files a voluntary petition of bankruptcy, is adjudged bankrupt or insolvent or has entered against it an order for relief in any bankruptcy or insolvency proceeding; (iii) seeks, consents to, or acquiesces in the appointment of a trustee for, receiver for, or the liquidation of the Partner or of all or any substantial part of the Partner’s properties; or (iv) files an answer or other pleading admitting, or failing to contest, the material allegations of a petition filed against the Partner in any proceeding described in subsections (i) through (iii);

(b)          if the Partner is a partnership or limited liability company, the dissolution and commencement of winding up of the Partner;

(c)          if the Partner is a corporation, the dissolution of the corporation or the revocation of its charter; or

(d)          if the Partner is an individual, his or her death or legal incompetence.

“Limited Partner” means each Person listed as a Limited Partner on the books and records of the Partnership and any other Person subsequently admitted as a Limited Partner of the Partnership in accordance with the terms hereof.

“Majority-in-Interest of the Preferred Limited Partners” means the Preferred Limited Partners holding in the aggregate more than fifty percent (50%) of the Preferred Units held by all Preferred Limited Partners.

“Merger Agreement” means that certain Agreement and Plan of Merger, dated as of November 14, 2013, by and among the Partnership, Blue Eagle Acquisition Sub, Inc. and the Company.

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“Net Equity Value” means, as of any particular date, the aggregate proceeds which would be received by the holders of Units if: (i) the assets of the Partnership as a going concern were sold at their fair market value; (ii) the Partnership satisfied and paid in full all of its obligations and liabilities (including all taxes, costs and expenses of the Partnership incurred in connection with such transaction and any reserves reasonably established by the General Partner for contingent liabilities); and (iii) such net sale proceeds were then distributed in accordance with Section 4.1, all as of such particular date and as determined by the General Partner in its reasonable discretion.

“Option Plan” means an option plan adopted by the General Partner, which permits employees or service providers of the Partnership and/or its Subsidiaries to receive options to acquire Common Units representing in the aggregate up to ten percent (10%) of the common equity of the Partnership (on a fully diluted basis) as of the Effective Date; provided that such percentage may be increased at any time by the General Partner in its sole discretion.

“Partially Adjusted Capital Account” means with respect to any Partner for any taxable year, the Capital Account of such Partner at the beginning of such taxable year, increased by all contributions during such year and all special allocations of income and gain pursuant to the last paragraph of Section 4.4 and Section 4.5 with respect to such taxable year, and decreased by all distributions during such taxable year and all special allocations of losses and deductions pursuant to the last paragraph of Section 4.4 and Section 4.5, but before giving effect to any allocation of Profits or Losses for such taxable year pursuant to Section 4.4(a) and (b).

“Partner” means any Person whose name is set forth on Exhibit A attached hereto or who has become a Partner pursuant to the terms of this Agreement.

“Partnership Property” means any and all property, real or personal, tangible or intangible, owned of record or beneficially by the Partnership.

“Permitted Transferee” means, (a) with respect to SCP or SCP Parallel, any Affiliate thereof, and (b) with respect to any other Limited Partner who is an individual and holds Preferred Units (and with respect to such Preferred Units), (i) the spouse of such Limited Partner, (ii) any trust created solely for the benefit of such Limited Partner and/or his or her spouse, parents, siblings and/or lineal descendants (including adoptive relationship and step children) and/or the spouses of any of the foregoing (collectively, the “Family Members”), (iii) a charitable remainder trust, the income from which will be paid to such Limited Partner during his life, (iv) a corporation, partnership or limited liability company whose only owners are such Limited Partner and/or the Family Members described in clause (ii) above and (v) such Persons executors, administrators, testamentary trustees, legatees or beneficiaries, by will or by the laws of intestate succession; provided that in all cases such Person remains in control of such transferee after such transfer and shall act for and on behalf of such transferee in all matters pertaining to such transferee’s Preferred Units and the Partnership shall be entitled to rely on all decisions, acts, consents and instructions of such Person as being the decision, act, consent and instruction of such Person’s transferees.

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“Person” means and includes any individual, corporation, partnership, association, limited liability company, trust, estate, custodian, nominee or any other individual or entity in its own or any representative capacity.

“Preferred Base Amount” means, with respect to a Preferred Partner, the amount of Capital Contributions made by such Partner with respect to the Preferred Units held by such Partner.

“Preferred Limited Partner” means a Limited Partner holding Preferred Units.

“Preferred Partners” means the General Partner and the Preferred Limited Partners.

“Preferred Return” means, for each Preferred Partner as of any date, an eight percent (8%) annual return, which return shall compound quarterly, on the Unpaid Preferred Base Amount of such Partner as of such date. For the avoidance of doubt, Tax Distributions made pursuant to Section 4.2 to a Preferred Partner shall not reduce such Partner’s Unpaid Preferred Base Amount for purposes of the calculation of such Partner’s Preferred Return.

“Preferred Unit” means an interest in the capital, profits, losses and distributions of the Partnership as provided herein. Each Preferred Unit shall entitle the holder thereof (other than the General Partner) to one vote on any matter submitted to the vote of the Limited Partners.

“Profits” and “Losses” means, for each period taken into account under Article IV, an amount equal to the Partnership’s taxable income or taxable loss for such period, determined in accordance with federal income tax principles, with the following adjustments:

(a)          There shall be added to such taxable income or taxable loss an amount equal to any income received by the Partnership during such period which is wholly exempt from federal income tax (e.g., interest income which is exempt from federal income tax under Section 103 of the Code);

(b)          Any expenditures of the Partnership described in Section 705(a)(2)(B) of the Code or treated as Section 705(a)(2)(B) expenditures pursuant to Section 1.704-1(b)(2)(iv)(i) of the Regulations, and not otherwise taken into account in computing Profits or Losses, shall be subtracted from such taxable income or loss;

(c)          In the event the Gross Asset Value of any Partnership asset is adjusted pursuant to the terms of this Agreement, the amount of such adjustment shall be taken into account as gain or loss from the disposition of such asset for purposes of computing Profits or Losses;

(d)          Gain or loss resulting from any disposition of Partnership Property with respect to which gain or loss is recognized for federal income tax purposes shall be computed by reference to the Gross Asset Value of the Partnership Property disposed of, notwithstanding that the adjusted tax basis of such Partnership property differs from its Gross Asset Value;

(e)          In lieu of the depreciation, amortization, and other cost recovery deductions taken into account in computing such taxable income or loss, there shall be taken into account Depreciation for such fiscal year or other period;

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(f)          To the extent an adjustment to the adjusted tax basis of any Partnership asset pursuant to Section 734(b) or Section 743(b) of the Code is required pursuant to Section 1.704-1(b)(2)(iv)(m)(4) of the Regulations to be taken into account in determining Capital Accounts as a result of a distribution other than in liquidation of a Partner’s Economic Interest, the amount of such adjustment shall be treated as an item of gain (if the adjustment increases the basis of the asset) or loss (if the adjustment decreases the basis of the asset) from the disposition of the asset and shall be taken into account for purposes of computing Profits or Losses; and

(g)          Any items that are specially allocated pursuant to Section 4.4(c) and Section 4.5 shall not be taken into account in computing Profits and Losses.

“Pro Rata Share” means, with respect to any Preferred Partner as of any date of determination, the ratio of the total number of the Preferred Units held by such Partner as of such date to the total number of Preferred Units then held by all Preferred Partners (who have not forfeited their pre-emptive rights).

“Regulations” means the income tax regulations, including any temporary regulations, from time to time promulgated under the Code.

“Restrictive Covenants” means any confidentiality, non-competition, non-solicitation and other similar covenants to which a Service Partner is subject pursuant to an employment, subscription, restricted units or other agreement between such Service Partner and the Partnership and/or any of its Affiliates.

“Rollover Buyback Event” means, with respect to any Rollover Securityholder, the occurrence of any of the following: (a) a material breach of any Restrictive Covenant by such Rollover Securityholder, (b) a General Partner Determined Cause Event relating to such Rollover Securityholder, (c) the termination of such Rollover Securityholder’s employment with the Employer for Cause, or (d) a General Partner Determined Competition relating to such Rollover Securityholder.

“Rollover Securityholder” means each of Scott Dorfman, Larry Hanger, Robert Toner and their respective Permitted Transferees.

“SCP” means Sterling Capital Partners IV, L.P., a Delaware limited partnership, and any successor.

“SCP Parallel” means SCP IV Parallel, L.P., a Delaware limited partnership, and any successor.

“Secretary” means the Secretary of State of the State of Delaware.

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

“Sell-Down Transaction” means the transfer or sale (in one or more transactions), directly or indirectly, of Preferred Units by any Selling Partner at any time on or prior to the 12-month anniversary of the Effective Date to any independent third party in an aggregate amount, together with any Sell-Down Transactions effected prior to such transfer or sale, of up to 15% of the total number of Preferred Units held by SCP, SCP Parallel and their respective Affiliates as of the Effective Date (as adjusted to reflect any splits, reverse splits, share dividends or other similar events or circumstances).

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“Service Partner” means any Partner who is employed by or provides services to the Partnership and/or any of its Subsidiaries; provided that neither SCP, SCP Parallel nor any Affiliate thereof shall be deemed to be a Service Partner. For purposes of this Agreement, a Person shall be treated as and shall remain a Service Partner with respect to all of the Units held by such Person even if such Person no longer provides service to the Partnership and/or any of its Subsidiaries.

“Subsidiary” means, with respect to any Person, any entity of which (i) if a corporation, a majority of the total voting power of shares of stock entitled (without regard to the occurrence of any contingency) to vote in the election of directors, managers, or trustees thereof is at the time owned or controlled, directly or indirectly, by that Person or one or more of the other Subsidiaries of that Person or a combination thereof, or (ii) if a limited liability company, partnership, association, or other entity (other than a corporation), a majority of membership, partnership or other similar ownership interest thereof is at the time owned or controlled, directly or indirectly, by that Person or one or more Subsidiaries of that Person or a combination thereof. For purposes hereof, a Person or Persons shall be deemed to have a majority ownership interest in a limited liability company, partnership, association, or other entity (other than a corporation) if such Person or Persons shall be allocated a majority of limited liability company, partnership, association, or other entity gains or losses or shall be a manager, managing member, managing director or general partner of, or shall otherwise control the activities of, such limited liability company, partnership, association, or other entity. For purposes hereof, references to a “Subsidiary” of any Person shall be given effect only at such times that such Person has one or more Subsidiaries, and, unless otherwise indicated, the term “Subsidiary” refers to a Subsidiary of the Partnership.

“Substituted Partner” means any Person admitted to the Partnership as a substitute or additional Partner pursuant to the provisions of Section 7.2(c).

“Target Capital Account” means, with respect to any Partner and any taxable year, an amount (which may be either a positive or a deficit balance) equal to (A) the amount that would be received by such Partner if all Partnership assets were sold for cash equal to their Gross Asset Value, all Partnership liabilities were satisfied to the extent required by their terms (limited, with respect to each partner non-recourse liability and partner non-recourse debt, as defined in Regulations Section 1.704-2(b)(4), to the Gross Asset Value of the assets securing such liability), and the net assets of the Partnership were distributed in full to the Partners as required pursuant to Section 8.2(a)(iv), all as of the last day of such taxable year, minus (B) the sum of (1) the Partner’s share of partner minimum gain determined pursuant to Regulations Section 1.704-2(g), and (2) the Partner’s share of the partner non-recourse debt minimum gain determined in accordance with Regulations Section 1.704-2(i)(5), in each case computed immediately prior to the hypothetical sale described above.

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“Transfer” means, when used as a noun, any voluntary sale, hypothecation, pledge, assignment, attachment, or other transfer, and, when used as a verb, means, voluntarily to sell, hypothecate, pledge, assign, or otherwise transfer.

“Unit” means a Preferred Unit, a Common Unit or any other class or series of unit of the Partnership created by the General Partner in accordance with this Agreement.

“Unpaid Preferred Base Amount” means, with respect to each Preferred Partner as of any date of determination, the excess (if any) of (i) such Partner’s Preferred Base Amount, over (ii) the aggregate amount of all distributions made to such Partner pursuant to Section 4.1(a)(ii) as of such date.

“Unpaid Preferred Return” means, with respect to each Preferred Partner as of any date of determination, the excess (if any) of (i) such Partner’s Preferred Return over (ii) the aggregate amount of all distributions made to such Partner pursuant to Section 4.1(a)(i) as of such date.

Article II
Formation and Name; Office; Purpose; Term

2.1           Formation of the Partnership.   The Partnership was formed as a limited partnership pursuant to the Act. The General Partner shall use all reasonable efforts to assure that all filing, recording, publishing and other acts necessary or appropriate for compliance with all requirements for the continuation of the Partnership as a limited partnership under the Act are made or taken. Each party hereto represents and warrants that it is duly authorized to join in this Agreement and that the Person executing this Agreement on its behalf is duly authorized to do so.

2.2           Name of the Partnership.   The name of the Partnership is “Blue Eagle Holdings, L.P.” The Partnership may do business under that name and under any other name or names that the General Partner selects. If the Partnership does business under a name other than that set forth in its Certificate of Formation, then the Partnership shall comply with any requirements of the Act or applicable law necessary to do business under such name or names.

2.3           Purpose.   The purpose and business of the Partnership shall be to engage in the Business (directly or through one or more Subsidiaries) and, in the discretion of the General Partner, in any other lawful act or activity which may be conducted by a limited partnership organized under the laws of the State of Delaware.

2.4           Term.   The term of the Partnership shall continue in perpetuity, unless its existence is terminated pursuant to Article VIII hereof.

2.5           Registered Office; Registered Agent; Principal Office; Other Offices.   The registered office of the Partnership required by the Act to be maintained in the State of Delaware shall be the office of the registered agent named in the Certificate of Limited Partnership or such other office (which need not be a place of business of the Partnership) as the General Partner may designate from time to time in the manner provided by law. The registered agent of the Partnership in the State of Delaware shall be the registered agent named in the Certificate of Limited Partnership or such other Person or Persons as the General Partner may designate from time to time in the manner provided by law. The principal office of the Partnership shall be at such place as the General Partner may designate from time to time and the Partnership shall maintain records there. The Partnership may have such other offices as the General Partner may designate from time to time.

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2.6          Partners.   The name, Capital Contribution, and number and classes of Units of each Partner (other than an Common Limited Partner) are set forth on Exhibit A, as such Exhibit shall be amended from time to time in accordance with the terms of this Agreement. Any reference in this Agreement to Exhibit A shall be deemed to refer to Exhibit A as amended and then in effect in accordance with the terms of this Agreement.

Article III
Capital Contributions

3.1          Capital Contributions as of the Effective Date.

(a)          Each Preferred Partner has contributed or is deemed to have contributed to the Partnership the amount set forth opposite such Partner’s name in the column entitled “Preferred Base Amount” on Exhibit A in exchange for the number of Preferred Units set forth opposite such Partner’s name.

(b)          The number of Common Units issued to any Service Partner upon exercise of a unit option shall be reflected on the books and records of the Partnership.

(c)          Each Partner shall be liable only to make such Partner’s Capital Contribution to the Partnership expressly provided in this Section 3.1, and no Partner shall be required to make total contributions to the capital of the Partnership in excess of such Capital Contribution.

3.2          Additional Capital Contributions; Preemptive Rights.

(a)          Additional Capital.   If at any time the General Partner in its sole discretion determines to raise capital through the issuance and sale of interests in the Partnership in excess of the Capital Contributions described in Section 3.1 to properly carry out or further the business of the Partnership, the General Partner shall have the right, subject to the provisions of Section 3.2(b), to raise such additional capital and, to the extent the Person(s) investing such capital are not already Partners, to admit such Person(s) as Additional Partners, on terms that, subject to the rights set forth in Section 3.2(b), may be senior to, junior to or on parity with the terms of the interests of the Partners in respect of their Units.

(b)          Preemptive Rights.   If the General Partner determines to issue Additional Securities pursuant to this Section 3.2, or if any of the Partnership’s Subsidiaries determines to issue Additional Securities, each Preferred Partner shall have the right to purchase up to such Partner’s Pro Rata Share of all (or any part of) the Additional Securities which the Partnership may, from time to time, propose to sell and issue, or in the case of any of the Partnership’s Subsidiaries, such Partner’s Pro Rata Share of all (or any part of) the Additional Securities available for purchase by SCP, SCP Parallel and their respective Affiliates, as determined by the General Partner in good faith. The preemptive rights granted to the Preferred Partners under this Section 3.2 shall be subject to the following provisions:

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(i)          Notice of Issuance of Additional Securities; Acceptance.   In the event the Partnership or any of its Subsidiaries undertakes or proposes to undertake an issuance or issuances of Additional Securities in which any Preferred Partner has the right to participate pursuant to Section 3.2(b), the Partnership shall give each such Preferred Partner at least thirty (30) days’ prior written notice (the “Preemptive Notice”) thereof, describing the type(s) of Additional Securities, the price(s), and the general terms upon which the Additional Securities are proposed to be issued. Each Preferred Partner shall have thirty (30) days from the date of receipt of any such Preemptive Notice (i) to provide written confirmation in form and substance acceptable to the Partnership in its sole discretion of such Partner’s status as an “accredited investor” (as defined in the Rules and Regulations promulgated under the Securities Act) and (ii) to agree to purchase up to the Partner’s Pro Rata Share of such Additional Securities (subject to the further provisions of this Section 3.2(b) below) for the price(s) and upon the general terms specified in the Preemptive Notice by giving written notice to the Partnership and stating therein the quantity of Additional Securities to be purchased.

(ii)         Right to Proceed with Issuance.   If the Partnership gives a Preemptive Notice prior to an issuance of Additional Securities, any definitive agreement to issue such Additional Securities on substantially the same economic terms as set forth in the Preemptive Notice that is entered into within one hundred fifty (150) days after such Preemptive Notice shall be deemed to be part of the same offering and issuance, and no further Preemptive Notice shall be required pursuant to Section 3.2(b)(i) above with respect to such offer or issuance. If the Partnership or Subsidiary, as the case may be, offers or agrees to issue any Additional Securities on economic terms that are different in any material respect from those set forth in the most recently delivered Preemptive Notice or, in any event, more than one hundred fifty (150) days after the most recently delivered Preemptive Notice, the offer or issuance of such Additional Securities by the Partnership or Subsidiary, as the case may be, shall be deemed a new offering and the Partnership shall be required to give a separate Preemptive Notice with respect thereto.

(iii)        Non-Purchase Event.   In the event that any Service Partner who is also a Preferred Partner does not exercise in full its right to purchase up to such Partner's Pro Rata Share of any Additional Securities offered by the Partnership or any of its Subsidiaries pursuant to Section 3.2(b)(i) above at any time after such Partner ceases to be employed or engaged by the Partnership or its Subsidiaries, such Preferred Partner thereafter shall no longer be entitled to the pre-emptive rights afforded to the Preferred Partners under this Section 3.2(b).

(iv)        Acknowledgment.   Each Preferred Partner acknowledges that if such Partner does not exercise the rights granted to such Partner pursuant to this Section 3.2(b), upon an issuance of Additional Securities, such Partner’s percentage ownership of Units on a fully diluted, as-if converted basis will be reduced. Each Preferred Partner acknowledges that if such Partner does exercise the rights granted to such Partner pursuant to this Section 3.2(b), such Partner and the Partnership or Subsidiary, as the case may be, shall be required to execute customary documentation in connection therewith, including customary representations, warranties, covenants and indemnities as may reasonably be required by the Partnership or Subsidiary, as the case may be.

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3.3          No Interest on Capital Contributions. Partners shall not be paid interest on their Capital Contributions.

3.4          Return of Capital Contributions.   Except as otherwise provided in this Agreement, no Partner shall have the right to receive the return of any Capital Contribution.

3.5          Form of Return of Capital.   If a Partner is entitled to receive a return of a Capital Contribution, the Partner shall not have the right to receive any form of consideration other than cash in return of the Partner’s Capital Contribution.

3.6          Capital Accounts.   The Partnership shall maintain a separate Capital Account for each Partner.

3.7          Loans.   Any Partner or an Affiliate of a Partner may make loans to the Partnership or any Subsidiary of the Partnership in the event the General Partner determines that the Partnership or any of its Subsidiaries requires such loan in order to fund the Partnership’s or any of its Subsidiaries’ working capital or avoid any default under any agreement with its lenders or other third parties. Any such loan by a Partner shall be on such terms as agreed to by such Partner and the Partnership.

3.8          Common Units.

(a)          As of the Effective Date, the Partnership has authorized [________]¹ Common Units (the “Authorized Common Units”), which shall be reserved for issuance by the Company upon exercise of options granted pursuant to the Option Plan. To the extent that, on or after the Effective Date, any such Common Units are forfeited, canceled or otherwise terminated, or the Common Units are not delivered because an option award under the Option Plan is settled in cash or used to satisfy the applicable tax withholding obligation, such Common Units shall remain part of the Authorized Common Units. The number of Authorized Common Units can be increased by the General Partner at any time in its sole discretion.

(b)          As a condition to the award of any options under the Option Plan, the intended recipient of such options shall execute a unit option or similar agreement, in a form approved by the General Partner, and shall take such other steps, and execute such other documents as are contemplated thereunder.

Article IV
Distributions and Allocations

4.1           Distributions of Available Cash.   For purposes of this Article IV, a “Partner” shall be deemed to include an Economic Owner.

¹            Number of Common Units equal to 10% of the fully-diluted equity of Parent to be inserted.

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(a)          In General. The General Partner may in its sole discretion from time to time cause the Partnership to make distributions of Available Cash to the Partners. Subject to the rights of any senior or pari passu securities issued under Section 3.2(a), any distributions of Available Cash shall be made to the Partners in the following order of priority:

(i)          first, an amount equal to the aggregate Unpaid Preferred Return as of the date of such distribution shall be distributed to the Preferred Partners pro rata in accordance with their respective Unpaid Preferred Returns;

(ii)         second, an amount equal to the aggregate Unpaid Preferred Base Amount as of the date of such distribution shall be distributed to the Preferred Partners pro rata in accordance with their respective Unpaid Preferred Base Amounts; and

(iii)        thereafter, the remaining Available Cash shall be distributed to the Partners as follows:

(A)         an amount equal to the product of the remaining Available Cash multiplied by the Common Unit Factor shall be distributed to the Common Limited Partners in proportion to the number of Common Units held by each such Partner; and

(B)         an amount equal to the remaining Available Cash after the distribution described in clause (iii)(A) above shall be distributed to the Preferred Partners in proportion to the number of Preferred Units held by each such Partner.

(b)          In-Kind Distribution.   If any assets of the Partnership are distributed in kind to the Partners, those assets shall be valued on the basis of their fair market value, as determined by an appraiser selected by the General Partner and any Partner entitled to receive such assets may receive an interest in such assets as a tenant-in-common with all other Partners so entitled.

(c)          No Obligation to Restore Negative Capital Account.   No Partner shall be obligated to restore a Negative Capital Account during the term of, or upon dissolution of, the Partnership.

4.2          Distributions with Respect to Tax.

(a)           Notwithstanding Section 4.1 or any other provision of this Agreement, the Partnership shall use reasonable best efforts, prior to any distributions pursuant to Section 4.1(a), to distribute to each Partner an amount equal to such Partner’s Tax Distribution (as defined in Section 4.2(b)) to enable the Partners to pay federal, state and local income taxes on taxable income of the Partnership allocated to the Partners during a taxable year (said taxable income allocated to a Partner to be determined by netting all items of Profits and Losses which are allocated by the Partnership to the Partners and as to which the Partners are subject to tax, provided, however, in no event shall the Partnership make Tax Distributions to a Partner if the cumulative taxable losses allocated to a Partner over the life of the Partnership at any given time exceed the cumulative taxable income of the Partnership allocated to such Partner for such period. Distributions made pursuant to Sections 4.1(a)(i), and (iii) shall serve to discharge the Partnership’s obligations under this Section 4.2 to the extent paid. Distributions made under this Section 4.2 shall reduce amounts distributable pursuant to Sections 4.1(a)(i) and (iii) and Section 8.2(a)(iv).

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(b)         The amount distributable to a Partner pursuant to Section 4.2(a) (a “Tax Distribution”) with respect to a taxable year of the Partnership shall be equal to the product of (i) the excess of (A) the taxable income allocated to such Partner by the Partnership for that year on which taxes will be payable for Federal and state income tax purposes, over (B) the cumulative net losses, if any, theretofore allocated to such Partner from the Partnership from the date hereof through the end of such taxable year and not previously applied for purposes of this Section 4.2(b), and (ii) the Assumed Tax Rate.

(c)         Any and all Tax Distributions shall be paid with respect to any taxable year of the Partnership on a quarterly basis to allow the Partners to pay their estimated income tax liability (based on the General Partner’s good faith estimate of the taxable income of the Partnership for the current taxable year and the amount of Tax Distribution which such Partner is entitled pursuant to Section 4.2(b)), with any additional distribution (based on the actual taxable income of the Partnership for such taxable year) to be paid no later than March 10 following such taxable year.

4.3          Limitations on Distributions.   Notwithstanding anything to the contrary contained herein, the Partners hereby acknowledge and agree that the Partnership’s ability to make any distributions to its Partners may be subject to the satisfaction of certain covenants and approvals pursuant to such commercially-reasonable loans with third parties and/or associated security agreements or mortgages to which the Partnership is a party or by which its assets may be bound and that the distributions due to the Partners pursuant to this Agreement may be prohibited by such loan and/or security agreements. The Partnership will use good faith efforts to negotiate for Tax Distributions to generally be permitted by the Partnership’s loan and/or security agreements.

4.4          Allocations of Profits and Losses.   Except as otherwise required by Section 704(b) of the Code and Sections 4.5 and 4.6 hereof, Profits and Losses of the Partnership for any taxable year shall be allocated as follows:

(a)         Profits.   Profits for each taxable year shall be allocated to the Partners so as to reduce, proportionally, the difference between their respective Target Capital Accounts and Partially Adjusted Capital Accounts for such fiscal year. No portion of the Profits for any taxable year shall be allocated to a Partner whose Partially Adjusted Capital Account is greater than or equal to its Target Capital Account for such fiscal year.

(b)         Losses.   Losses for each taxable year shall be allocated to the Partners so as to reduce, proportionally, the difference between their respective Partially Adjusted Capital Accounts and Target Capital Accounts for such fiscal year. No portion of the Losses for any taxable year shall be allocated to a Partner whose Target Capital Account is greater than or equal to its Partially Adjusted Capital Account for such fiscal year.

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(c)          Loss Limitation.   Losses allocated pursuant to Section 4.4(b) shall not exceed the maximum amount of Losses that can be allocated without causing any Partner to have an Adjusted Capital Account Deficit at the end of any taxable year. In the event that some but not all of the Partners would have and Adjusted Capital Account Deficit as a consequence of an allocation of Losses pursuant to Section 4.4(b), the limitations set forth herein shall be applied on a Partner-by-Partner basis and Losses not allocable to any Partner as a result of such limitation shall be allocated to the other Partners in accordance with the positive balances in such Partners’ Capital Accounts so as to allocate the maximum permissible Losses to each Partner under Regulations Section 1.704-1(b)(2)(ii)(d).

Notwithstanding the foregoing, the General Partner may make such allocations as it deems reasonably necessary to give economic effect to the provisions of this Agreement, taking into account facts and circumstances as the General Partner deems reasonably necessary for this purpose.

4.5          Regulatory Allocations.

(a)          Minimum Gain and Partner Minimum Gain Chargebacks.   Notwithstanding any other provision of this Article IV, items of Partnership income and gain shall be allocated so as to comply with the minimum gain chargeback requirements of Regulations Sections 1.704-2(f) and 1.704-2(i)(4).

(b)          Qualified Income Offset.   If a Partner unexpectedly receives any adjustments, allocations or distributions described in Regulations Section 1.704-1(b)(2)(ii)(d)(4), 1.704-1(b)(2)(ii)(d)(5), or 1.704-1(b)(2)(ii)(d)(6), items of Partnership income and gain shall be specially allocated to such Partner in an amount and manner sufficient to eliminate, to the extent required by the Regulations, the Adjusted Capital Account Deficit of such Partner as quickly as possible; provided, however, that an allocation pursuant to this Section 4.5(b) shall be made if and only to the extent that the Partner would have an Adjusted Capital Account Deficit after all other allocations provided for in this Article IV have been tentatively made as if this Section 4.5(b) were not in this Agreement.

(c)          Non-recourse Deductions.   Non-recourse deductions (as defined in Regulations Section 1.704-2(b)(1)) for any taxable year or other period shall be allocated to the Preferred Partners pro rata in accordance with their respective Preferred Units. The amount of non-recourse deductions and excess non-recourse liabilities shall be determined in accordance with Regulations Section 1.704-2(c).

(d)          Partner Non-recourse Deductions.   Any partner non-recourse deductions (as defined in Regulations Section 1.704-2(i)(1)) for any taxable year or other period shall be specially allocated to the Partner who bears the economic risk of loss with respect to the partner non-recourse debt to which such partner non-recourse deductions are attributable in accordance with Regulations Section 1.704-2(i). The amount of partner non-recourse deductions shall be determined in accordance with Regulations Section 1.704-2(i)(2).

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(e)          Effect of Regulatory Allocations.   The allocations described in Section 4.4(c) and Section 4.5(a), (b), (c) and (d) above (the “Regulatory Allocations”) are intended to comply with certain requirements of Regulations Sections 1.704-1(b) and 1.704-2 and as such may not be consistent with the manner in which the Partners intend to allocate items of income, gain, loss, deduction and expense or make distributions. Accordingly, notwithstanding other provisions of this Section 4.5 and Section 4.4(c), but subject to the requirements of the Regulations, items of income, gain, loss, deduction and expense in subsequent taxable years shall be allocated among the Partners in such a way as to reverse as quickly as possible the effect of the Regulatory Allocations and thereby cause the respective Capital Accounts of the Partners to be in the amounts they would have been if Profits and Losses (and such other items of income, gain, deduction and loss) had been allocated without reference to the Regulatory Allocations.

4.6          Special Allocations Relating to Entity-Level Taxes; Withholding.

(a)          Special Allocations Relating to Entity-Level Taxes.   Notwithstanding anything to the contrary herein, in the event that and to the extent that any state, local or other income tax imposed on the Partnership as an entity is reduced by reason of the holding of an interest by any Partner, no part of the expense of the Partnership for such tax shall be allocated to such Partner. In addition, if the Partnership is obligated under applicable law to pay any amount to a governmental agency because of a Partner’s status as a Partner of the Partnership for federal or state withholding or other taxes, such amount shall reduce the distributions which would otherwise be made to such Partner pursuant to this Article IV.

(b)          Withholding.   The Partnership shall comply with the withholding provisions of Federal, state and local law and shall remit amounts withheld to and file required forms with the applicable jurisdictions. To the extent the Partnership is required to withhold and pay over any amounts to any authority with respect to distributions or allocations to any Partner, the amount withheld shall be treated as a distribution in the amount of the withholding to that Partner for all purposes under this Agreement. In the event of any claimed over-withholding, the Partner shall be limited to a refund claim against the applicable jurisdiction. If the amount withheld was not withheld from actual distribution to a Partner, the Partnership may, at the General Partner’s option, (i) require the Partner to reimburse the Partnership for such withholding upon request by the General Partner, or (ii) reduce any subsequent distributions to the Partner by the amount of such withholding. Each Partner agrees to furnish the Partnership with any representations and forms as shall reasonably be requested by the General Partner to assist it in determining the extent of, and in fulfilling, the Partnership's withholding obligations.

4.7          Allocation for Income Tax Purposes.

(a)          Allocation in General.   Except as otherwise provided in Section 4.7(b), for each fiscal year, items of Partnership income, gain, loss, deduction and expense, shall be allocated, for federal, state and local income tax purposes, among the Partners in the same manner as the Profits (and the items thereof) or Losses (and the items thereof) of which such items are components were allocated pursuant to Section 4.4.

(b)          Section 704(c) Items.   In accordance with Section 704(c) of the Code and the Regulations thereunder, income, gain, loss, and deduction with respect to any property contributed to the capital of the Partnership shall, solely for tax purposes, be allocated among the Partners so as to take account of any variation between the adjusted basis of such property to the Partnership for federal income tax purposes and its initial Gross Asset Value. If the Gross Asset Value of a Partnership asset is adjusted pursuant to clause (b) of the definition of Gross Asset Value, subsequent allocations of income, gain, loss, and deduction with respect to such asset for tax purposes shall take account of any variation between the adjusted basis of such asset for federal income tax purposes and its Gross Asset Value in the same manner as under Section 704(c) of the Code and the Regulations thereunder. Any elections or other decisions relating to such allocations shall be made by the General Partner.

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(c)          Allocations Solely for Tax Purposes. Allocations pursuant to this Section 4.7 are solely for purposes of federal, state and local taxes and shall not affect, or in any way be taken into account in computing, any Partner’s Capital Account or share of Profits and Losses or other items or distributions pursuant to any provision of this Agreement.

Article V
General Partner

5.1          General Partner.

(a)          General Partner.   The Partnership shall be managed by the General Partner.

(b)          Withdrawal of General Partner.   The General Partner may withdraw as a General Partner of the Partnership without the consent of any Person upon notice to the Limited Partners. Any such withdrawal by the General Partner shall result in the dissolution of the Partnership; provided that the General Partner may admit additional general partners of the Partnership or successor general partners of the Partnership, which additional or successor general partners may be affiliated with the General Partner or, subject to applicable law, may be unaffiliated third parties, and in such case the withdrawal by the General Partner shall not result in the dissolution of the Partnership.

(c)          Authority of the General Partner.   The General Partner shall have the power and authority to manage, control, administer and operate the business and affairs of the Partnership and to take all such actions as it deems necessary or appropriate to accomplish the purposes of the Partnership as set forth herein.

(d)          Agents and Officers.   The General Partner may from time to time authorize or appoint individuals to act as officers or agents of the Partnership on a general basis or for a specific purpose, which individuals shall have full power and authority to act for and bind the Partnership as authorized by the General Partner. Each officer or agent of the Partnership appointed by the General Partner shall hold office until his successor is elected or appointed or until his earlier displacement from office by resignation, removal or otherwise. Any officer or agent of the Partnership may resign by written notice to the Partnership and may be removed for cause or without cause by the General Partner in its sole discretion. Any number of offices may be held by the same person.

5.2          Right to Engage in Other Activities.   Subject to any employment or other agreements with the Partnership or any Subsidiary or between or among any Partners, to which a Person may be a party or otherwise subject, each Partner, at any time and from time to time, may engage in and own interests in other business ventures of any type and description, independently or with others.

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5.3          Transactions Between the Partnership and the Partners.  Notwithstanding that it may constitute a conflict of interest, the Partners and their respective Affiliates may engage in any transaction (including the purchase, sale, lease or exchange of any property or the rendering of any service or the establishment of any salary, other compensation or other terms of employment) with the Partnership and/or one or more of its Subsidiaries so long as such transaction is, as determined by the General Partner in good faith. The Partners hereby specifically consent to and authorize the Company to enter into an advisory services agreement with Sterling Fund Management, LLC, an Affiliate of SCP, substantially in the form attached hereto as Exhibit B (the “Advisory Services Agreement”).

5.4          Limitation of Liability.

(a)          Except as otherwise provided herein or in any agreement entered into by such Person and the Partnership, and to the maximum extent permitted by the Act, no present or former General Partner, or any of its Affiliates, employees, agents or representatives, shall be liable to the Partnership or to any Partner for any act or omission performed or omitted by such Person in its capacity as, or on behalf of, the General Partner; provided that, except as otherwise provided herein, such limitation of liability shall not apply to the extent the act or omission was attributable to such Person’s willful misconduct, gross negligence, bad faith or knowing violation of law or if such liability results from such Person’s action taken in his capacity as an individual or outside the authority with respect to the Partnership conferred to such Person. The General Partner may, in good faith, exercise any of the powers granted to it by this Agreement and perform any of the duties imposed upon it hereunder either directly or by or through its Affiliates, employees, agents or representatives, and the General Partner shall not be responsible for any misconduct or negligence on the part of any such Person appointed by the General Partner (so long as such Person was selected in good faith and with reasonable care). The General Partner shall be entitled to consult with legal counsel, accountants, appraisers, management consultants, investment bankers and other consultants and advisors selected by it, and any act taken or omitted to be taken in reliance upon the opinion of such Persons as to matters that the General Partner reasonably believes to be within such Person’s professional or expert competence shall be conclusively presumed to have been done or omitted in good faith and in accordance with such opinion.

(b)          Whenever in this Agreement or any other agreement contemplated herein, the General Partner is permitted or required to take any action, the General Partner, acting in good faith, shall be entitled to consider such interests and factors as it desires (including the interests of the General Partner or any of its Affiliates as a Partner).

(c)          Whenever in this Agreement the General Partner is permitted or required to take any action or to make a decision in its “good faith” or under another express standard, the General Partner shall act under such express standard and, to the extent permitted by applicable law, shall not be subject to any other or different standards imposed by this Agreement or any other agreement contemplated herein, and, notwithstanding anything contained herein to the contrary, so long as the General Partner acts in good faith or such other express standard required, the resolution, action or terms so made, taken or provided by the General Partner shall not constitute a breach of this Agreement or any other agreement contemplated herein or impose liability upon the General Partner or any of its respective Affiliates, employees, agents or representatives.

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(d)          To the maximum extent permitted by applicable law, each Partner hereby waives any claim or cause of action against the General Partner or any of its Affiliates, employees, agents and representatives for any breach of any fiduciary duty to the Partnership or the Partners, including as may result from a conflict of interest between the Partnership or any of its Subsidiaries and such Person in his or her capacity as a Partner. Subject to compliance in good faith with the terms of this Agreement, the General Partner shall not be obligated to recommend or take any action as the General Partner or as an agent of the Partnership that prefers the interests of the Partnership or any of its Subsidiaries or the other Partners over the interests of the General Partner or any of its Affiliates, employees, agents or representatives, and the Partnership and each of the Partners hereby waive the duty, if any, of the General Partner to act as a fiduciary to the Partnership or any of the Partners, or to consider the effect of any actions on any particular class or series of Units, including in the event of any such conflict of interest.

(e)          Except as otherwise required by law or the provisions of this Agreement, the Partnership shall indemnify its present and former General Partner and their respective Affiliates, employees, agents and representatives (and their heirs, executors and personal and legal representatives) against any losses, liabilities, damages or expenses (including amounts owed for attorneys’ fees, judgments and settlements in connection with any threatened, pending or completed action, suit or proceeding) to which any of such Persons may directly or indirectly become subject for action taken or omitted to be taken on behalf of the Partnership or the General Partner or in connection with any involvement with the Partnership or its Subsidiaries (including serving as a manager, agent, officer, director, consultant or employee of the Partnership or its Subsidiaries), unless such losses, liabilities, damages or expenses are caused by such Person’s gross negligence, willful misconduct or bad faith; provided, however, that, except for proceedings to enforce rights to indemnification, the Partnership shall not be obligated to indemnify any Person (or his or her heirs, executors or personal or legal representatives) in connection with a proceeding (or part thereof) initiated by such Person unless such proceeding (or part thereof) was authorized or consented to by the General Partner. The right to indemnification conferred by this Section 5.4(e) shall include the right to be paid by the Partnership the expenses incurred in defending or otherwise participating in any proceeding in advance of its final disposition upon receipt by the Partnership of an undertaking by or on behalf of the General Partner or other Person receiving advancement to repay the amount advanced if it shall ultimately be determined that the General Partner or other Person is not entitled to be indemnified by the Partnership under this Section 5.4(e).

(f)          The Partnership shall be the primary obligor in respect of the General Partner or any other Person’s claim for indemnification, advancement of expenses and/or insurance, to the extent subject to this Section 5.4, and the obligation, if any, of SCP, SCP Parallel or any of their respective Affiliates (each, a “Related Fund”) to indemnify, advance expenses to or provide insurance for the General Partner or any other Person shall be secondary to the obligations of the Partnership under this Section 5.4. In the event that any Related Fund is or is threatened to be made a party to or a participant in any proceeding, and the Related Fund’s involvement in the proceeding arises in whole or in part from the service to the Partnership of the General Partner, then the Related Fund shall be directly entitled to all rights and remedies of the General Partner hereunder to the same extent as the General Partner. To the extent any Related Fund advances or pays any amounts to the General Partner in connection with any claim subject to this Section 5.4, whether or not such Related Fund is or is threatened to be made a party to or a participant in any proceeding, such Related Fund shall be subrogated to the rights of the General Partner against the Partnership pursuant to this Section 5.4. For the avoidance of doubt, each Related Fund is a third-party beneficiary of this Section 5.4(f) and may enforce its terms against the Partnership.

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5.5          Indemnification of Officers.  The Partnership, at the direction of the General Partner, may indemnify and advance expenses to an officer, employee or agent of the Partnership or any Subsidiary to the same extent and subject to the same conditions under which it shall indemnify and advance expenses under Section 5.4(e).

5.6          Nonexclusivity of Rights.  The right to indemnification and the advancement and payment of expenses conferred in this Article V shall not be exclusive of any other right that the General Partner or other Person indemnified pursuant to this Article V may have or hereafter acquire under any contract, law (common or statutory) or provision of this Agreement.

5.7          Insurance.  The Partnership or one or more of the Subsidiaries may obtain and maintain, at its expense, insurance to protect itself and the General Partner, and any officers or other agents of the Partnership or any Subsidiary who is or was serving at the request of the Partnership or any Subsidiary as a manager, representative, director, officer, partner, venturer, proprietor, trustee, employee, agent or similar functionary of another foreign or domestic limited liability company, corporation, partnership, joint venture, sole proprietorship, trust, employee benefit plan or other enterprise, against any expense, liability or loss, whether or not the Partnership would have the power to indemnify such Person against such expense, liability or loss under this Article V. The Partnership shall use its best efforts to cause its insurance providers, if any, to satisfy any claims under this Article V to the fullest extent of the coverage provided, notwithstanding any other indemnities or insurance available to any Person from any Related Fund.

5.8          Savings Clause.  If this Article V or any portion hereof shall be invalidated on any ground by any court of competent jurisdiction, then the Partnership shall nevertheless indemnify and hold harmless each Person indemnified pursuant to this Article V as to costs, charges and expenses (including reasonable attorneys’ fees and expenses), judgments, fines and amounts paid in settlement with respect to any Proceeding, appeal, inquiry or investigation to the full extent permitted by any applicable portion of this Article V that shall not have been invalidated and to the fullest extent permitted by applicable law.

5.9          Power of Attorney.

(a)         Grant of Power.  Each Partner constitutes and appoints the General Partner as the Partner’s true and lawful attorney-in-fact (“Attorney-in-Fact”), and in the Partner’s name, place and stead, to make, execute, sign, acknowledge, and file, with respect to the Partnership:

(i)          the Certificate of Limited Partnership consistent with this Agreement;

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(ii)         all documents (including amendments to the Certificate of Limited Partnership and/or this Agreement) which the Attorney-in-Fact deems appropriate to reflect any amendment, change, or modification of this Agreement that has been properly approved in accordance with Section 10.4 of this Agreement;

(iii)        any and all other certificates or other instruments required to be filed by the Partnership under the laws of the State of Delaware or of any other state or jurisdiction, including, without limitation, any certificate or other instruments necessary in order for the Partnership to continue to qualify as a limited partnership under the laws of the State of Delaware;

(iv)        one or more applications to use an assumed name;

(v)         all documents and instruments which the Attorney-in-Fact deems necessary and appropriate to execute on behalf of a Partner if such Partner does not take any actions properly requested by the General Partner pursuant to Section 7.3, 7.5 or 7.6; and

(vi)        all documents which may be required to dissolve and terminate the Partnership and to cancel the Certificate of Limited Partnership.

(b)         Irrevocability.  The foregoing power of attorney is irrevocable and is coupled with an interest, and, to the extent permitted by applicable law, shall survive the death or dissolution of a Partner or the Transfer of a Unit, except that if the transferee of such Unit is approved for admission as a Substituted Partner pursuant to Section 7.2(c), this power of attorney granted by the transferor shall survive the delivery of the assignment for the sole purpose of enabling the Attorney-in-Fact to execute, acknowledge and file any documents needed to effectuate the substitution.

Article VI
Limited Partners

6.1          No Right to Participate in Management.  Notwithstanding anything to the contrary contained herein, except as required by the Act and except as explicitly set forth herein, the Limited Partners shall not participate in the management or control of the Partnership’s business nor shall they transact any business for the Partnership, nor shall they have the power to act for or bind the Partnership, said powers being vested solely and exclusively in the General Partner.

6.2          Liability.  Except as otherwise required by the Act, a Limited Partner, as such, shall not be personally liable for any of the debts, liabilities, contracts or any other obligations of the Partnership.

6.3          Incapacity or Dissolution.  The death, incapacity, dissolution or bankruptcy of a Limited Partner, or the transfer of all of his interest in the Partnership to anyone that is not a Limited Partner, shall not cause a dissolution of the Partnership, but the rights of such Limited Partner to share in the Profits and Losses of the Partnership, to receive distributions of Partnership funds and to assign an interest pursuant to Article VII hereof shall, on the happening of such an event, devolve on his or its successors-in-interest, if any, and the Partnership shall continue as a limited partnership under the Act.

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6.4          Duties of the Parties.

(a)         Except as otherwise set forth in Section 6.4(b) below or in any other agreement between a Limited Partner and the Partnership, nothing herein shall be deemed to restrict in any way the rights of any Limited Partner, any Affiliate of any Limited Partner, or any member, partner or shareholder of any Partner or each of their respective Affiliates to conduct any other business or activity whatsoever, and no Limited Partner shall be accountable to the Partnership or to any other Partner with respect to that business or activity. The organization of the Partnership shall be without prejudice to the rights of the Partners (or the rights of their respective Affiliates) to maintain, expand or diversify such other interests and activities and to receive and enjoy profits or compensation therefrom. Except as otherwise set forth in Section 6.4(b) below or in any other agreement between a Limited Partner and the Partnership, no Partner or Affiliate thereof shall be obligated to present any particular investment opportunity to the Partnership or any Partner even if such opportunity is of a character that, if presented to the Partnership, could be taken by the Partnership, and any Partner or Affiliate thereof shall have the right to take for its own account (individually or as a partner, member, shareholder, fiduciary or otherwise) or to recommend to others any such particular investment opportunity. Each Partner hereby waives any rights the Partner or its Affiliates might otherwise have to share or participate in such other interests or activities of any other Partner, the Partner’s Affiliates, or any member, partner or shareholder of any Partner or any of their respective Affiliates.

(b)         Each Service Partner agrees that while such Person (or any of his Affiliates or Permitted Transferees) is a full-time employee of the Partnership or any of its Subsidiaries, if such Person (or any of his Affiliates or Permitted Transferees) learns of any investment opportunity in an entity engaged in the Business, such Person shall present, or shall cause his Affiliates to present, such investment opportunity to the Partnership.

Article VII
Uncertificated Units; Transfer of Units

7.1          Uncertificated Units.  The Partnership will not issue certificates representing Units or other equity interests in the Partnership, and the Units or other equity interests in the Partnership outstanding at any time shall be as set forth on Exhibit A, as the same may be amended or modified in accordance with this Agreement.

7.2          Transfers.

(a)         Other than Transfers to a Permitted Transferee or pursuant to Section 7.3, 7.5, 7.6 or 7.8, no Person may Transfer all or any portion of its Units or any interest in the Partnership without the prior written consent of the General Partner, which consent may be given or withheld in the General Partner’s sole discretion.

(b)         In addition to the other requirements of this Section 7.2, unless waived by the General Partner, no Transfer of all or any portion of Units or any interest in the Partnership shall be made unless the following conditions are met:

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(i)          The Transfer will not violate registration requirements under any Federal or state securities laws;

(ii)         The transferee delivers to the Partnership a written instrument agreeing to be bound by the terms of this Agreement and assume all obligations of the transferor under this Agreement with respect to the Units being transferred;

(iii)        The Transfer will not result in the Partnership being subject to the Investment Company Act of 1940, as amended; and

(iv)        The Transfer will not cause the Partnership to be treated as a “publicly traded partnership” within the meaning of the Code and Regulations.

(c)         No transferee of a Partner’s Unit or interest in the Partnership shall become a Substituted Partner unless such transfer shall be made in compliance with Section 7.2(a) and (b) and:

(i)          the General Partner shall have consented to the admission of such transferee as a Substituted Partner; and

(ii)         the transferring Partner and the transferee shall have executed and acknowledged such other instruments as the General Partner may deem necessary and desirable.

(d)         A transferee of a Partner’s Unit or interest in the Partnership that is not admitted as a Substituted Partner shall become an Economic Owner.

(e)         Each Partner hereby acknowledges the reasonableness of the prohibition contained in this Section 7.2 in view of the purposes of the Partnership and the relationship of the Partners. Any Person to whom Units or interests in the Partnership are attempted to be transferred in violation of this Section 7.2 shall not be entitled to vote on matters coming before the Partners, participate in the management of the Partnership, act as an agent of the Partnership, receive distributions from the Partnership or have any other rights in or with respect to the Units or interests in the Partnership.

7.3          Drag-Along Rights.

(a)         If the General Partner elects to consummate a sale of all of the Units or equity interests in the Partnership (including by merger, consolidation, reorganization or combination of the Partnership) to any independent third party (each such transaction referred to as a “Sale”), the General Partner shall notify the Partners and Economic Owners in writing of such Sale and provide a description of the Sale setting forth the reasonable details, terms, and conditions thereof. Upon request by the General Partner, each Partner and Economic Owner will consent to and raise no objections to the proposed transaction, and will take all other actions reasonably necessary or desirable to cause the consummation of such Sale on the terms proposed by the General Partner. The obligations of the Partners and Economic Owners pursuant to this Section 7.3(a) with respect to a Sale are subject to the following conditions: (x) the consideration payable upon consummation of such Sale to all of the Partners and Economic Owners shall be allocated among the Partners and Economic Owners as set forth in Section 4.1(a), and (y) upon the consummation of the Sale, all of the Partners and Economic Owners who own the same class of securities shall receive the same form of consideration per Unit as the other holders of the same class of securities. Each Partner agrees to be bound by agreements with respect to indemnification obligations, amounts paid into escrow, amounts subject to holdbacks or amounts subject to post-closing purchase price adjustments, and agreements to appoint representatives; provided, that any such indemnification, escrow, holdback and adjustment obligations undertaken by any Partner (A) shall be in the reverse order of the distributions pursuant to Section 4.1(a) (i.e., Partners and Economic Owners having the lowest priority of distributions having the first obligation with respect to any such indemnification, escrow, holdback and adjustment obligations), and (B) shall not exceed the total amount of consideration received by such Partner in connection with such Sale (except with respect to representations and warranties relating solely to such Partner, including title to any Units).

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(b)         To the extent that a Partner or Economic Owner does not take any actions when requested by the General Partner pursuant to this Section 7.3, each such Partner or Economic Owner hereby constitutes and appoints the General Partner as such Partner’s or Economic Owner’s true and lawful Attorney-in-Fact and authorizes the Attorney-in-Fact to execute on behalf of such Partner or Economic Owner any and all documents and instruments which the Attorney-in-Fact deems necessary and appropriate in connection with the Sale. The foregoing power of attorney is irrevocable and is coupled with an interest.

7.4          Withdrawal of Partners.  No Limited Partner shall have the right to withdraw from the Partnership, except in the case of an Involuntary Withdrawal or transfer of all of such Partner’s Units in accordance with the terms of this Agreement. Immediately upon the occurrence of an Involuntary Withdrawal, the successor(s) of the Partner so withdrawing shall thereupon become Economic Owner(s) but shall not become Partner(s).

7.5          Repurchase of Service Partner’s Common Units.  Notwithstanding anything to the contrary contained herein, all Common Units held by a Service Partner or beneficially owned by any Service Partner or any of his or her transferees (the “Covered Units”) shall be subject to the Partnership’s right of repurchase or forfeiture under the circumstances and on the terms and conditions specified below.

(a)         Repurchase and Forfeiture Upon Termination.  If any Service Partner’s employment or service with the Employer is terminated:

(i)          (x) by the Employer for any reason other than for Cause, (y) by the Service Partner, or (z) as a result of the Service Partner’s death or disability, the Partnership shall have the right, but not the obligation, pursuant to procedures described in Section 7.5(c), to purchase all of such Service Partner’s Covered Units for an aggregate price equal to the Fair Market Value of the Covered Units to be purchased as of the date of such termination of employment; and

(ii)         by the Employer for Cause, all of such Service Partner’s Covered Units shall be forfeited as of the effective date of such termination of employment without any act by the General Partner, the Partnership or any Partner.

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The repurchase option described in clause (i) above shall be exercisable by the General Partner by delivery of written notice to such Service Partner (or his Permitted Transferees) or his executor or personal representative, as applicable, within 180 days of the effective date of such Service Partner’s termination of employment or service with Employer.

(b)         Partnership’s Rights Upon Breach of Restrictive Covenant, Competition with the Partnership or General Partner Determined Cause Event.

(i)          If any Service Partner breaches any Restrictive Covenant, the Partnership shall have the right, but not the obligation, to cause the forfeiture of any Covered Units.

(ii)         In the event of a General Partner Determined Competition or General Partner Determined Cause Event with respect to a Service Partner, the Partnership shall have the right, but not the obligation pursuant to procedures described in Section 7.5(c), to purchase all of such Service Partner’s Covered Units for an aggregate price equal to the Fair Market Value of such Units as of the closing date of such repurchase event; provided that the Partnership shall have the right to cause the forfeiture of all of such Covered Units if the event giving rise to such General Partner Determined Competition is that such Service Partner competed with the Partnership and/or its Subsidiaries while employed by or providing services to the Partnership and/or its Affiliates.

(iii)        The foregoing option shall be exercisable by the General Partner by written notice to such Service Partner or his executor or personal representative, as applicable, on or before 180 days after the date such breach or event is discovered by the Partnership.

(c)          Repurchase Procedures.

(i)          The Partnership shall have the right, but not the obligation, to purchase all or any non-forfeited Covered Units held by a Service Partner by sending written notice to the Service Partner within the 180-day period described in Section 7.5(a) or Section 7.5(b) above, as applicable. Such a notice shall specify the closing date for the repurchase of any Covered Units by the Partnership.

(ii)         The purchase price for the Covered Units shall be paid by the Partnership, in the General Partner’s election, (x) in cash at closing, (y) by delivery of an unsecured promissory note subordinated and junior in right of payment to all other indebtedness of the Partnership, with customary terms and conditions, including interest at a rate equal to the Applicable Federal Rate, and payable in sixteen equal quarterly installments of principal together with accrued interested thereon, with the first installment due on the first day of the first quarter after the closing and the subsequent quarterly installments due on the first day of the successive sixteen quarters (a “Repurchase Note”), or (z) in any combination thereof; provided, however, that, in the event that the Partnership repurchases any Covered Units pursuant to Section 7.5(a)(i), the purchase price shall be paid by the partnership (A) in an amount in cash at closing equal to the lesser of the (I) the purchase price, (II) $250,000 ($500,000, with respect to Scott D. Dorfman), and (III) the maximum amount permitted to be paid by the Partnership under its or any of its Subsidiaries credit facilities and (B) by delivery of a Repurchase Note in the principal amount equal to the purchase price for the Covered Units minus the amount paid in cash pursuant to clause (A).

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(iii)        If any Person required to sell Covered Units pursuant to this Section 7.5 fails, for any reason, to tender the instruments reasonably required for the purchase and sale of the Covered Units at the time and place specified by the Partnership, such Person shall be deemed to have assigned all of his right, title and interest in and to the Covered Units to the Partnership and such Person shall cease to have any rights with respect to the Covered Units except only to receive the purchase price therefor as computed pursuant to this Section 7.5 and such Transferred Units shall be deemed cancelled on the Partnership’s books and shall no longer be outstanding.

(iv)        In the event the Partnership exercises its repurchase right with respect to any Covered Units in accordance with Section 7.5(a) or Section 7.5(b) above, the Partnership shall have the right, in the General Partner’s sole discretion, to pay for such Covered Units by causing the Partnership to first distribute to the applicable Service Partner shares of stock of the Company with “fair market value” equal to the purchase price for such Covered Units (such shares of the Company, the “Redemption Shares”), in which case the Company shall immediately repurchase the Redemption Shares from the Service Partner, and the Service Partner shall sell to the Company the Redemption Shares, under the same terms and conditions as the terms and conditions applicable to such repurchased Covered Units.

7.6          Repurchase of Service Partner’s Preferred Units.

(a)         Upon the occurrence of a Rollover Buyback Event with respect to a Rollover Securityholder, the Partnership shall have the right, but not the obligation pursuant to procedures described in Section 7.5(c) (except that any references to “Covered Units” shall be deemed to refer to “Preferred Units”), to purchase all of the Preferred Units held by any of such Rollover Securityholder (and his Affiliates) for an aggregate price equal to the Fair Market Value of such Preferred Units as of the closing date of such Rollover Buyback Event. The foregoing option shall be exercisable by written notice to such Rollover Securityholders on or before 180 days after the date such Rollover Buyback Event is discovered by the Partnership or the General Partner makes such determination.

(b)         In the event that the foregoing option is exercised, the notice thereof will be accompanied by the General Partner’s determination of the Fair Market Value of such Preferred Units.

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7.7          Incorporation.  The Partners hereby agree that, upon the approval of the General Partner of a plan to incorporate the Partnership or merging the Partnership into an Affiliate of SCP to effectuate a consummation of an initial public offering of the Partnership (the “Incorporation Plan”) in any transaction intended to qualify under Section 351 (or any successor provision) of the Code, and which maintains the relative rights (including distribution rights) of the Units hereunder (the “Section 351 Transaction”), each Partner will consent to and raise no objections to the proposed Section 351 Transaction, and will take all other actions reasonably necessary or desirable to cause the consummation of the Section 351 Transaction on the terms proposed by the General Partner, including but not limited to, each Partner will transfer such Partner's Units to a corporation specifically formed for such purpose or to such Affiliate of SCP (each of such new corporation and Affiliate of SCP, the “Corporation”) in exchange for stock of the Corporation. The Corporation shall issue its stock in the Section 351 Transaction in accordance with the Incorporation Plan, which shall specify the classes of stock for which the Units shall be exchanged and which shall attach as an exhibit the form of organizational document which shall set forth the rights and privileges of such classes of stock; provided that such classes of stock shall provide for comparable economic, governance, priority and other rights and privileges as in effect immediately prior to the Incorporation Plan, in each case, to the extent such governance and other rights (other than comparable economic rights) are permitted under applicable laws and regulatory requirements.

7.8          Tag-Along Right.  Notwithstanding any consent given by the General Partner pursuant to Section 7.2, in the event that SCP, SCP Parallel or any of their respective Affiliates that is a Partner (each, a “Selling Partner”) receives from an independent third party a bona fide offer to purchase all or any portion of the Preferred Units held by such Selling Partner (the “Transfer Units”), other than pursuant to a Sell-Down Transaction, and the Selling Partner wishes to accept such offer, the Selling Partner may engage in such sale as long as the Rollover Securityholders holding Preferred Units (each such Partner, a “Tag-Along Partner”) shall be afforded the right to sell to such transferee (such transfer, a “Tag-Along Sale”) simultaneously therewith (on the same general terms and conditions as the terms and conditions set forth in the offer received by the Selling Partner) a number of Preferred Units determined as provided in this Section 7.8 (the “Tag-Along Right”). The Selling Partner shall send a written notice to each Tag-Along Partner, which notice shall contain the number of Preferred Units the Selling Partner desires to sell, the name of the prospective transferee, the consideration offered in connection therewith, and all other material information about the proposed sale and the proposed transferee as has been provided to the Selling Partner (the “Sale Offer”). Each Tag-Along Partner may elect to participate in the contemplated sale by delivering written notice of such election to the Selling Partner within fifteen (15) days after delivery of the Sale Offer. The number of Preferred Units which such Tag-Along Partner shall be entitled to sell pursuant to this Section 7.8 shall equal the product of (1) the total number of Preferred Units to be sold in the contemplated sale multiplied by (2) the quotient determined by dividing (x) the number of Preferred Units owned by such Tag-Along Partner, by (y) the aggregate number of Preferred Units owned by the Selling Partner and the Tag-Along Partners who elected to participate in such sale. This Section 7.8 shall not apply to, and shall terminate upon the consummation of, a public offering that is registered under the Securities Act.

Article VIII
Dissolution, Liquidation, and Termination of the Partnership

8.1          Events of Dissolution.  The Partnership shall be dissolved upon the decision of the General Partner to liquidate or dissolve the Partnership.

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8.2          Procedure for Winding Up and Dissolution.

(a)         If the Partnership is dissolved, the General Partner shall wind up its affairs. On the winding up of the affairs of the Partnership, the assets of the Partnership shall be distributed in the following order of priority:

(i)          first, to pay the costs and expenses of the winding up, liquidation and termination of the Partnership;

(ii)         second, to creditors of the Partnership, including any liabilities and obligations payable to the Partners or Affiliates of the Partners;

(iii)        third, to establish reserves determined by the General Partner to be reasonably adequate to meet any and all contingent or unforeseen liabilities or obligations of the Partnership; and

(iv)        fourth, in accordance with Section 4.1(a).

(b)         Notwithstanding anything to the contrary in this Agreement, upon a liquidation within the meaning of Regulations Section 1.704-1(b)(2)(ii)(g), if any Partner has a deficit Capital Account balance (after giving effect to all contributions, distributions, allocations and other Capital Account adjustments for all taxable years, including the year during which such liquidation occurs), such Partner shall have no obligation to make any contribution to the capital of the Partnership and the deficit balance in such Partner’s Capital Account shall not be considered an asset of the Partnership or as a debt owed by such Partner to the Partnership or to any other Person for any purpose whatsoever.

8.3          Certificate of Cancellation.  On completion of the distribution of Partnership assets as provided herein, the Partnership is terminated, and shall file a certificate of cancellation with the Secretary, cancel any other filings made pursuant to Section 2.1 and take such other actions as may be necessary to terminate the Partnership.

Article IX
Books, Records, Accounting, and Tax Elections

9.1          Bank Accounts.  All funds of the Partnership shall be deposited in a bank account or accounts maintained in the Partnership’s name. The General Partner shall determine the institution or institutions at which the accounts will be opened and maintained, the types of accounts, and the Persons who will have authority with respect to the accounts and the funds therein.

9.2          Books and Records.

(a)          The General Partner shall keep or cause to be kept complete and accurate books and records of the Partnership and supporting documentation of the transactions with respect to the conduct of the Partnership’s business. The records shall include, but not be limited to, a copy of the Certificate of Limited Partnership and this Agreement and all amendments to the Certificate of Limited Partnership and this Agreement, a current list of the names and last known business, residence, or mailing addresses of all Partners, and the Partnership’s Federal, state or local tax returns.

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(b)         The books and records shall be kept on the cash or accrual method of accounting, as determined from time to time by the General Partner, and shall be maintained in accordance with sound accounting practices and shall be available at the Partnership’s principal office for examination by any Preferred Limited Partner (and not any other Partner) or such Partner’s duly authorized representative at any and all reasonable times during normal business hours. Each such Partner shall reimburse the Partnership for all costs and expenses incurred by the Partnership in connection with such Partner’s inspection and copying of the Partnership’s books and records.

(c)         All matters concerning (i) the determination of the relative amount of allocations and distributions among the Partners pursuant to Articles III and IV, and (ii) accounting procedures and determinations, and other determinations not specifically and expressly provided for by the terms of this Agreement, shall be determined by the General Partner in good faith and in the exercise of its reasonable business judgment, whose determination shall be final and conclusive as to all of the Partners absent manifest clerical error.

9.3          Annual Accounting Period.  The annual accounting period of the Partnership shall end on December 31. The Partnership’s taxable year shall be selected by the General Partner, subject to the requirements and limitations of the Code.

9.4          Reports.  Within one hundred fifty (150) days after the end of each taxable year of the Partnership, the General Partner shall use its good faith efforts to cause to be sent to each Preferred Limited Partner a complete accounting (including audited financial statements) of the affairs of the Partnership for the taxable year then ended. In addition, within ninety (90) days after the end of each taxable year of the Partnership, the General Partner shall use its good faith efforts to cause to be sent to each Person who was a Partner at any time during the taxable year then ended, that tax information concerning the Partnership which is necessary for preparing the Partner’s income tax returns for that year.

9.5          Tax Matters Partner; Tax Elections.  The General Partner is hereby designated the “tax matters partner” of the Partnership. The General Partner may make any tax elections for the Partnership allowed under the Code, or the tax laws of any state or other jurisdiction having taxing jurisdiction over the Partnership. The General Partner may, in its reasonable discretion, make or revoke the election referred to in Section 754 of the Code.

9.6          Title to Partnership Property.  All real and personal property acquired by the Partnership shall be acquired and held by the Partnership in its name.

Article X
General Provisions

10.1        Further Assurances. Each Partner shall execute all such certificates and other documents and shall do all such filing, recording, publishing and other acts as the General Partner deems appropriate to comply with the requirements of law for the formation and operation of the Partnership and to comply with any laws, rules, and regulations relating to the acquisition, operation, or holding of the property of the Partnership.

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10.2        Notifications.  Except as otherwise provided in this Agreement, any notice, demand, consent, election, offer, approval, request, or other communication (collectively, a “notice”) required or permitted hereunder must be in writing and either delivered personally, sent by certified or registered mail, postage prepaid, return receipt requested, sent by facsimile or sent by recognized overnight delivery service. A notice must be addressed to a Partner at the Partner’s last known address (or facsimile number) on the records of the Partnership. A notice to the Partnership must be addressed to the Partnership at the Partnership’s principal office (or facsimile number). A notice delivered personally will be deemed given only when acknowledged in writing by the person to whom it is delivered. A notice that is sent by mail will be deemed given three (3) business days after it is mailed. A notice sent by facsimile will be deemed given on the next business day after the date of such delivery so long as a copy also is sent by other means permitted hereunder. A notice sent by recognized overnight delivery service will be deemed given when received or refused. Any party may designate, by notice to all of the others, substitute addresses or addressees for notices; and, thereafter, notices are to be directed to those substitute addresses or addressees.

10.3        Specific Performance.  The parties recognize that irreparable injury will result from a breach of any provision of this Agreement and that money damages will be inadequate to fully remedy the injury. Accordingly, in the event of a breach or threatened breach of one or more of the provisions of this Agreement, any party to this Agreement who may be injured (in addition to any other rights and remedies that may be available to such Person under this Agreement, any other agreement or under any law) shall be entitled (without posting a bond or other security) to one or more preliminary or permanent orders (i) restraining and enjoining any act which would constitute a breach or (ii) compelling the performance of any obligation which, if not performed, would constitute a breach.

10.4        Amendment; Waivers.

(a)         Except as expressly provided in this Section 10.4, this Agreement may be amended, modified or supplemented, and waivers of or consents to departures from the provisions hereof may be given, from time to time only by a written instrument approved by the General Partner and a Majority-in-Interest of the Preferred Limited Partners; provided that any amendment, modification or waiver that affects the economic rights of the Rollover Securityholders hereunder with respect to their Preferred Units in any manner that is adverse, material and disproportionate relative to the economic rights of the Preferred Units held by Sterling shall require the prior written consent of the Rollover Securityholders holding a majority of the Preferred Units held by the Rollover Securityholders; provided that the terms and conditions of any Additional Securities issued in accordance with this Agreement shall not be deemed to have adversely affected the Rollover Securityholders.

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(b)         Notwithstanding the foregoing, the General Partner shall have the right, without the consent of any Limited Partner, to amend this Agreement, including, without limitation, Exhibit A hereto, in such fashion as may be reasonably required to reflect any of the following transactions: (i) to reflect the issuance of Additional Securities and/or the admission of Substituted Partners or Additional Partners in accordance with the terms of this Agreement (including pursuant to Section 3.2 when the Partners did not exercise their preemptive rights and to reflect any corresponding modifications of the Partners’ Units, capital or other provisions of this Agreement as a result of any additional Capital Contributions pursuant to Sections 3.2(a) and (b)), (ii) to make changes and additions necessary to reflect the terms of interests issued pursuant to Section 3.2, (iii) to cure any ambiguity or to correct or supplement any provision herein that may be inconsistent with any other provision herein, or (iv) to delete or add any provision in this Agreement required to be deleted or added by a state “Blue Sky” commissioner or similar such official, which deletion or addition is deemed by such official to be for the benefit of the Partners. The Partners hereby specifically consent to an amendment of this Agreement from time to time in such manner as is reasonably determined in good faith by the General Partner, upon the advice of counsel for the Partnership, to be necessary or reasonably helpful to ensure that the allocations of profits and losses and individual items thereof are given effect for federal income tax purposes, including any amendments determined by the General Partner, in consultation with counsel to the Partnership, to be necessary to comply with the Regulations under Section 704 of the Code, or, on or before the effective date of final regulations, to provide for (A) the election of a safe harbor under Regulations Section 1.83-3(1) (or any similar provision) under which the fair market value of an interest in the Partnership that is transferred in connection with the performance of services is treated as being equal to the liquidation value of that interest, (B) an agreement by the Partnership and all of its Partners to comply with the requirements set forth in such regulations and Internal Revenue Service Notice 2005-43 (and any other guidance provided by the Internal Revenue Service with respect to such election) with respect to all interests in the Partnership transferred in connection with the performance of services while the election remains effective, and (C) any other related amendments; provided that, without the consent of a Majority-in-Interest of the Preferred Limited Partners, no election or amendment shall be made pursuant to this Section 10.4(b) if the safe harbor, when finalized, is substantially different from that set forth in Notice 2005-43 and the application of the safe harbor would result in materially adverse consequences to the Partners.

10.5        Arbitration; Submission to Jurisdiction.

(a)         Subject to Section 10.3, with respect to disputes, problems or claims arising out of or in connection with this Agreement (“Disputes”), the Partners shall, in good faith, use their reasonable best efforts to resolve the Dispute. If after such efforts the Partners are unable within ten (10) days of the arising of the Dispute to resolve the Dispute in good faith, they shall promptly mutually agree upon a qualified, independent third party experienced in the area in Dispute to resolve such Dispute within thirty (30) days of the date the Dispute is first submitted to such independent third party. The determination(s) of such qualified, independent third party shall be final and binding for purposes of this Agreement. Notwithstanding the foregoing, in the event (i) such third party is unable to make a determination within said thirty (30) day period, or (ii) the Partners are unable to agree upon a third party to resolve the Dispute, either party may submit to final and binding arbitration before JAMS/Endispute (“JAMS”), with an office located in Chicago, Illinois, or its successor, pursuant to the Federal Arbitration Act, 9 U.S.C. Sec. 1et sec. Either party may commence the arbitration process called for in this Agreement by filing a written demand for arbitration with JAMS, with a copy to the other party. The arbitration will be conducted in Chicago, Illinois, in accordance with the provisions of JAMS Streamlined Arbitration Rules and Procedures in effect at the time of filing of the demand for arbitration. The parties will cooperate with JAMS and with one another in selecting an arbitrator from JAMS panel of neutrals, and in scheduling the arbitration proceedings. The provisions of this Section 10.5(a) with respect to the arbitration before JAMS may be enforced by any court of competent jurisdiction, and the parties seeking enforcement shall be entitled to an award of all costs, fees and expenses, including attorney’s fees, to be paid by the parties against whom enforcement is ordered. Each party agrees to pay its own legal fees and expenses in the event of any such arbitration. The parties hereto agree that this Section 10.5(a) has been included to rapidly and inexpensively resolve any disputes between them with respect to the matters described above, and that this paragraph shall be grounds for dismissal of any court action commenced by any party with respect to a dispute arising out of such matters.

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(b)         Consent to Jurisdiction. The parties hereto hereby irrevocably submit themselves to the exclusive jurisdiction of state courts of the State of Illinois or the federal courts sitting in the State of Illinois for the purpose of enforcing any arbitration decision that may be issued pursuant to Section 10.5(a) hereof or obtaining any court order pursuant to Section 10.3. The parties hereto hereby individually agree that they shall not assert any claim that they are not subject to the jurisdiction of such courts, that the venue is improper, that the forum is inconvenient or any similar objection, claim or argument. Service of process on any of the parties hereto with regard to any such action may be made by mailing the process to such Persons by regular or certified mail to the address of such Person specified in Section 10.2.

10.6        GOVERNING LAW. ALL QUESTIONS CONCERNING THE CONSTRUCTION, VALIDITY AND INTERPRETATION OF THIS AGREEMENT AND THE EXHIBIT HERETO WILL BE GOVERNED BY THE INTERNAL LAW, AND NOT THE LAW OF CONFLICTS, OF THE STATE OF DELAWARE.

10.7        Notice to Partners of Provisions. By executing this Agreement, each Partner acknowledges that such Partner has actual notice of (a) all of the provisions hereof (including the restrictions on Transfer set forth herein), and (b) all of the provisions of the Certificate of Formation of the Partnership.

10.8        Descriptive Headings; Interpretation. The descriptive headings of this Agreement are inserted for convenience of reference only and do not constitute a substantive part of this Agreement. Whenever required by the context, any pronoun used in this Agreement shall include the corresponding masculine, feminine, or neuter forms, and the singular form of nouns, pronouns, and verbs shall include the plural and vice versa. The use of the word “including” in this Agreement shall be by way of example rather than by limitation. Reference to any agreement, document, or instrument means such agreement, document, or instrument as amended or otherwise modified from time to time in accordance with the terms thereof, and, if applicable, hereof. Without limiting the generality of the immediately preceding sentence, no amendment or other modification to any agreement, document, or instrument that requires the consent of any Person pursuant to the terms of this Agreement or any other agreement will be given effect hereunder unless such Person has consented in writing to such amendment or modification. The use of the words “or,” “either,” and “any” shall not be exclusive. The parties hereto have participated jointly in the negotiation and drafting of this Agreement. In the event an ambiguity or question of intent or interpretation arises, this Agreement shall be construed as if drafted jointly by the parties hereto, and no presumption or burden of proof shall arise favoring or disfavoring any party by virtue of the authorship of any of the provisions of this Agreement. Wherever a conflict exists between this Agreement and any other agreement, this Agreement shall control but solely to the extent of such conflict.

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10.9        Severability. Each provision hereof shall be considered separable. The invalidity or unenforceability of any provisions hereof in any jurisdiction shall not affect the validity, legality or enforceability of the remainder hereof in such jurisdiction or the validity, legality or enforceability hereof, including any such provision, in any other jurisdiction, it being intended that all rights and obligations of the parties hereunder shall be enforceable to the fullest extent permitted by law. If, for any reason, any provision or provisions herein are determined to be invalid and contrary to any existing or future law, such invalidity shall not impair or affect the other provisions herein.

10.10      Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original and all of which, when taken together, shall constitute one and the same document.

10.11      Attorneys’ Fees. In any action or proceeding brought to enforce any provision of this Agreement, or where any provision hereof is validly asserted as a defense, the prevailing party shall be entitled to recover reasonable attorneys’ fees and expenses from the non-prevailing party in addition to any other available remedy.

10.12      Agreement With Respect to Partners. With respect to the Partners, it is agreed that none of their respective parents, subsidiaries, Affiliates, investors, officers, directors, shareholders, partners, members, employees, agents, representatives, equity or debt holders, or any of their respective parents, subsidiaries, Affiliates, investors, officers, directors, members, shareholders, employees, agents, representatives, equity or debt holders, shall have any obligation or liability for any reason, under or in any way related to this Agreement. This paragraph is intended to and shall preclude the Partners from alleging or pursuing any claim that depends on or is based in the doctrine of “alter ego”, “piercing the corporate veil” or any other argument or law seeking to hold any person or entity other than the entities that are signatories to this Agreement responsible for any obligation that may arise as a result of this Agreement.

10.13      Binding Provisions. This Agreement is binding upon, and inures to the benefit of, the parties hereto and their respective heirs, executors, administrators, personal and legal representatives, successors, and permitted assigns.

10.14      Entire Agreement. This Agreement embodies the complete agreement and understanding among the parties and supersedes and preempts any prior understandings, agreements or representations by or among the parties, written or oral, which may have related to the subject matter hereof in any way.

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10.15      Delivery by Facsimile. This Agreement, the agreements referred to herein, and each other agreement or instrument entered into in connection herewith or therewith or contemplated hereby or thereby, and any amendments hereto or thereto, to the extent signed and delivered by means of a facsimile machine, shall be treated in all manner and respects as an original agreement or instrument and shall be considered to have the same binding legal effect as if it were the original signed version thereof delivered in person. At the request of any party hereto or to any such agreement or instrument, each other party hereto or thereto shall re-execute original forms thereof and deliver them to all other parties. No party hereto or to any such agreement or instrument shall raise the use of a facsimile machine to deliver a signature or the fact that any signature or agreement or instrument was transmitted or communicated through the use of a facsimile machine as a defense to the formation or enforceability of a contract and each such party forever waives any such defense.

*      *      *      *      *

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IN WITNESS WHEREOF, the undersigned has executed this Limited Partnership Agreement of Blue Eagle Holdings, L.P. as of the date first written above.

General Partner:
By:
Limited Partners:
	, LP
By:
Name:
Title:
By:
Name:
Title:

EXHIBIT A

(as of _______, 2014) *

Name of Partner	Preferred Units	Preferred Base Amount
Sterling Capital Partners IV, L.P. (Limited Partner)
SCP IV Parallel, L.P. (Limited Partner)
Scott Dorfman (Limited Partner)
Larry Hanger (Limited Partner)
Robert Toner (Limited Partner)
Totals

[_________] Common Units are reserved for issuance upon exercise of options issued under the Option Plan.

EXHIBIT B

Advisory Services Agreement

EX-10.3

Exhibit 10.3

AMENDED AND RESTATED AIRCRAFT LEASE

THIS AMENDED AND RESTATED AIRCRAFT LEASE (this “Lease” or “this “Agreement”) is made and entered into as of the 14^th day of November, 2013, by and between SDD Holdings, Inc. a Georgia corporation (“Lessor”), and Innotrac Corporation, a Georgia corporation (“Lessee”). This Lease shall be effective upon the Closing (as such term is defined in the Merger Agreement).

WHEREAS, Lessee and Lessor are parties to that certain Aircraft Lease Agreement dated November 30, 2012 (the “Original Lease”), which provided for the lease of that certain Pilatus aircraft, aircraft serial number388 registration number N388PC, together with one (1) engine, model number PT6A-678, serial number PCE-PRO249, and all propellers, radar, equipment, electronics equipment and attachments (collectively, the “Aircraft”) by Lessor to Lessee.

WHEREAS, simultaneous with the execution and delivery of this Agreement, the Company, Blue Eagle Holdings, L.P. (“Parent”) and Blue Eagle Acquisition Sub, Inc. (“Purchaser”) are entering into that certain Agreement and Plan of Merger, dated as of the date hereof (the “Merger Agreement”).

WHEREAS, as a condition and inducement to Parent and Purchaser entering into and incurring their respective obligations under the Merger Agreement, Lessor and the Company have agreed to amend and restate the Original Lease on the terms set forth herein.

WHEREAS, a committee of independent directors of the board of directors of the Company has approved this Lease as an “employment compensation, severance or other employee benefit arrangement” pursuant to Rule 14d-10(d)(2) promulgated under the Securities Exchange Act of 1934.

NOW, THEREFORE, for and in consideration of the mutual premises, covenants and agreements contained herein, the parties hereto agree as follows:

1.            TERM; TERMINATION:

(a)          The term of this Lease shall commence on the Commencement Date and will continue thereafter until August 31, 2022, unless earlier terminated as hereinafter provided, and shall continue for successive one (1) year periods under the terms and conditions provided herein, unless written notice to the contrary is given by either party hereto to the other party at least thirty (30) days prior to the expiration of any such one-year period, unless sooner terminated as hereinafter provided. “Commencement Date” means the Closing Date (as such term is defined in the Merger Agreement.

(b)          Either Lessor or Lessee may terminate this Lease with or without cause effective upon September 1 of any year during the term by providing written notice of such termination to the other party at least thirty (30) days prior to such termination date.

(c)          Notwithstanding anything contained herein to the contrary, Lessee shall have the right to terminate this Agreement immediately upon the termination of Scott Dorfman’s employment with Lessee, howsoever arising.

2.            RENT: The annual rent payable hereunder by Lessee to Lessor shall be $360,000.00, payable in equal monthly installments of $30,000.00 on or before the first day of each calendar month during the term of this Lease. The monthly rental payments shall be paid to Lessor at Lessor’s address, as provided in Section 15 below, or at such other address as Lessor may designate in writing to Lessee from time to time. On each anniversary of the Commencement Date, the annual rent (and corresponding monthly installments) shall increase by 2.5%.

3.            RECORDS AND HOME AIRPORT: Lessee shall maintain accurate aircraft and engine log books and such other records, logs and books as the Federal Aviation Administration (“FAA”) may from time to time require, showing the full flight time of the Aircraft and shall keep such logs in the Aircraft and available for inspection by Lessor or its representatives at all reasonable times. During the term hereof, the Aircraft shall be permanently based at Peachtree-DeKalb Airport (the “Home Airport”), the cost of which shall be paid by Lessor.

4.            MAINTENANCE AND RETURN

(a)          Lessee shall perform, or cause to be performed, all pre- and post-flight inspections in accordance and as required by the FAA-approved inspection program for the Aircraft for any flights operated by Lessee. Lessee shall notify Lessor, or cause Lessor to be notified, of any maintenance requirement, dangerous condition, malfunction or worn part that may be discovered during any such inspection. Subject to the foregoing, Lessor shall be solely responsible for arranging the performance of all maintenance and inspections of the Aircraft during the Term, shall ensure that the Aircraft is maintained in an airworthy condition during the Term, and shall coordinate the performance of and payment for all repairs and maintenance of the Aircraft.

(b)          Upon the expiration of the term hereof, Lessee shall return the Aircraft to Lessor at such reasonable place as may be designated by Lessor in the same condition as it was when received by Lessee, normal wear and tear excepted. Nothing contained in this Section 4(b) may be interpreted to require Lessee to perform any maintenance or other obligation which is the responsibility of the Lessor pursuant to Section 4(a) hereof.

(c)          In August of 2012, the engine of the Aircraft had a complete overhaul costing $365,930. Lessee will pay for the full cost of the overhaul and depreciate the cost over the 10 year life expectancy of the engine. If Lessor terminates this Lease pursuant to Section 1(b) of this Lease before the end of the lease term or the Lessor continuously fails to provide use to the Lessee over a period of 30 days when the Lessee requires use of the Aircraft, Lessor will promptly pay Lessee the undepreciated cost of the engine overhaul as of the date of Lessor’s termination of the Lease or failure to provide use of the Aircraft to the Lessee when requested for a period for 30 days. If the Lessee terminates this Lease pursuant to Section 1(b) or 1(c) of this Lease before the end of the lease term or Lessee defaults under the Lease as provided under Section 9, Lessor will not be obligated to pay Lessee the amount of undepreciated engine overhaul cost existing at the time of the default or termination of the Lease by the Lessee.

5.            WARRANTY: Lessee hereby acknowledges receipt of the Aircraft and represents that the Aircraft has been examined and tested by Lessee. LESSOR MAKES NO WARRANTY OR REPRESENTATION, EXPRESS OR IMPLIED, WITH RESPECT TO THE AIRCRAFT, AND EXPRESSLY EXCLUDES, AND LESSEE ACKNOWLEDGES THE EXCLUSION OF, ANY AND ALL WARRANTIES OR REPRESENTATIONS, WHETHER. OF MERCHANTABILITY, FITNESS FOR USE OR OTHERWISE.

6.            INSURANCE:

(a)          Lessee, at its sole cost and expense, shall procure and maintain in effect during the term hereof a satisfactory policy or policies of insurance with insurers satisfactory to Lessor providing full hull coverage of the Aircraft for the benefit of Lessor including all risk and foreign object damage, both in flight and not in flight, whether in possession of Lessee or Lessor, in an amount equal to at least the replacement value of the Aircraft, but in no event less than $2,500,000. The proceeds of such coverage shall be payable to Lessor. Said policy shall contain a waiver of subrogation clause in favor of all additional named insureds.

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(b)          Lessee, at its sole cost and expense, shall procure and maintain in effect during the term hereof a satisfactory policy or policies of insurance with insurers satisfactory to Lessor providing bodily injury and property damage, liability insurance in an amount no less than $150,000,000, Combined Single Limit for the benefit of itself and Lessor in connection with the, possession use or operation of the Aircraft. Said policy shall be an occurrence policy and shall include Lessor as an operator and an additional named insured.

(c)          Lessee shall deliver to Lessor a copy or copies of the policy or policies by which the foregoing coverage shall have been procured or a certificate of the carrier or other evidence satisfactory to Lessor that such insurance coverage is in effect; provided, however, that Lessor shall be under no duty either to ascertain the existence of, or to examine, such insurance, or to advise Lessee in the event such insurance shall not comply with the requirements hereof Lessor shall have the right to approve the policy or policies effecting such insurance, but shall have no duty to do so. In the event of failure on the part of Lessee to provide insurance as aforesaid, Lessor may, at its option, procure such insurance and the cost thereof shall be payable to Lessor by Lessee upon demand.

(d)          The policy or policies affecting the coverage required by this Section 6 shall expressly provide that the interests of Lessor thereunder shall not be affected by any breach by Lessee of any policy provision, and that such policy or policies shall be cancelable only upon at least thirty (30) days’ prior written notice to Lessor. Every such policy shall contain a mortgagee endorsement in usual form in favor of any party having a security interest in the Aircraft.

7.            LOSS OR DAMAGE TO OR TAKING OF AIRCRAFT: Lessor shall bear all risks of loss or damage to the Aircraft and of the taking, confiscation or requisition (of use or title) thereof by any governmental authority during the term hereof, provided, however, that if loss or damage is caused by the gross negligence of Lessee while Lessee is in possession of the Aircraft, then Lessee shall bear such loss or damage. In the event of loss or damage to the Aircraft while not in Lessor’s possession, or the taking of the Aircraft, Lessee shall immediately report such loss or damage or taking to Lessor, to the carrier or carriers of all insurance thereon, and, as required by law, to governmental agencies, and shall furnish such information, execute such documents and do any and all other acts and things necessary to facilitate the collection of the proceeds of any insurance policy or policies thereon, or awards for such taking. In the event of such loss, damage or taking, the rights, liabilities and obligations of the parties hereto shall be as follows:

(a)       In the event that the Aircraft is lost or taken or is damaged beyond repair and the proceeds of any applicable insurance policy or policies are payable as a result thereof, or awards for such taking, shall be less than $100,000, then Lessee shall pay to Lessor an additional sum equal to the remainder after subtracting the amount of such proceeds or awards so payable from $100,000. Upon the receipt by Lessor of all monies due under this subsection (a) in the event of such loss, damage or taking, this Lease shall terminate.

(b)       In the event that the Aircraft is partially damaged, then this Lease shall remain in full force and effect, and Lessor shall, at its cost and expense, and in a timely manner, fully repair and restore the Aircraft to its condition prior to the occurrence of such damage, and this Lease shall thereupon continue in full force and effect. Such repair and, restoration shall be effected only in accordance with plans and specifications approved in advance in writing by Lessor. Upon the completion of such repair and restoration, Lessee shall reimburse Lessor for the costs thereof to the extent of any proceeds of insurance received by Lessee and covering such damage, such reimbursement to be contingent upon the execution by Lessor of all documents and the doing by Lessor of any and all other acts and things reasonably required for recovery of such insurance proceeds.

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8.            USAGE, FEES AND LIENS:

(a)          Non-Exclusivity.   Lessee and Lessor acknowledge that the Aircraft is leased to Lessee on a non-exclusive basis, and that the Aircraft shall, at other times, be operated by Lessor and may be otherwise subject to lease to others during the term of this Agreement at Lessor’s sole discretion. During any period during which the Lessor or any other person or entity is utilizing the Aircraft, Lessee’s leasehold rights to possession of the Aircraft under this Agreement shall temporarily abate, but all other provisions of this Agreement shall nevertheless continue in full force and effect.

(b)          Lessor and Lessee agree that Lessor may lease the Aircraft to one or more other lessees during the Term on a non-exclusive basis, that Lessor has the absolute right to determine the availability of the Aircraft for Lessee and that Lessor’s use of the Aircraft shall have priority over the availability of the Aircraft for lease to Lessee or any other party. Lessor shall advise Lessee of the individual or entity that will coordinate the scheduling of the Aircraft.

(c)          Operational Control.   THE PARTIES EXPRESSLY AGREE THAT LESSEE SHALL AT ALL TIMES WHILE THE AIRCRAFT IS IN ITS POSSESSION DURING THE TERM MAINTAIN OPERATIONAL CONTROL OF THE AIRCRAFT, AND THAT THE INTENT OF THE PARTIES IS THAT THIS AGREEMENT CONSTITUTE A “DRY” OPERATING LEASE. Lessee shall exercise exclusive authority over initiating, conducting, or terminating any flight conducted pursuant to this Agreement, and the Flight Crew (as defined herein) shall be under the exclusive command and control of Lessee in all phases of such flights.

(d)          Authority of Pilot in Command.    Notwithstanding that Lessee shall have operational control of the Aircraft during any flight conducted pursuant to this Agreement, Lessor and Lessee expressly agree that the Pilot in Command, as defined in Section 1.1 of the Federal Aviation Regulations, retained by Lessee, in his or her sole discretion, may terminate any flight, refuse to commence any flight, or take any other flight-related action which in the judgment of the Pilot in Command is necessitated by considerations of safety. The Pilot in Command shall have final and complete authority to postpone or cancel any flight for any reason or condition which in his or her judgment would compromise the safety of the flight.

(e)         Use and Operation.    Except as otherwise expressly provided herein, Lessee shall be solely and exclusively responsible for the use, operation and control of the Aircraft while in its possession during the term of this Agreement. Lessee shall operate the Aircraft in accordance with the provisions of Part 91 of the FARs and shall not operate the Aircraft in commercial service, as a common carrier, or otherwise on a compensatory or “for hire” basis except to the limited extent permitted under Subpart F of Part 91 of the FARs, if applicable. Lessee shall not, without prior written consent of Lessor, (i) sublease the Aircraft, (ii) enter into “time sharing agreements” or “interchange agreements” (as respectively defined In Sections 91.501(c)(1) and (2) of the FAA Regulations, 14 C.F.R. §91,501(c)(1) and (2), nor (iii) use the Aircraft for the purpose of “commuter” or “on-demand” operations (as respectively defined in Sections 119.3 of the FAA Regulations, 14 C.F.R. § 119.3). Lessee shall not use the Aircraft in any manner which shall violate any provision of any policy of insurance thereon, or any law or regulation of any governmental authority, including but not limited to, the FAA, and any fine, penalty or forfeiture, whether resulting from any such violation or otherwise, shall be the sole responsibility of Lessee.

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(f)         Operating Costs.   Lessor shall pay certain fixed and variable costs of operating the Aircraft as provided herein, including, without limitation, hangarage at the Home Airport, maintenance and inspections, overhauls, oil, and other lubricants. The foregoing notwithstanding, Lessee shall, at its own expense, (i) pay costs of fuel and oil required for operation of Lessee’s flights, (ii) pay standard catering costs, (iii) locate and retain (either through direct employment or contracting with an independent contractor for flight services) all pilots and other cabin personnel (including mechanic) required for Lessee's operations of the Aircraft (collectively the "Flight Crew"), and (iv) pay all miscellaneous out-of-pocket expenses incurred in connection with Lessee's operation of the Aircraft, including, but not limited to, landing fees, ramp fees, overnight hangar fees, de-icing costs, contaminant recovery costs, special-request catering and commissary costs, in-flight entertainment and telecommunications charges, ground transportation, Flight Crew travel expenses, charts, manuals, and other publications obtained for the specific flight, and any other similar items.         

(g)         Flight Crew.   All members of the Flight Crew shall be fully competent and experienced, duly licensed, and qualified in accordance with the requirements of applicable law and all insurance policies covering the Aircraft. All members of the Flight Crew who are pilots shall be fully trained in accordance with an FAA-approved training program, including initial and recurrent training and, where appropriate, contractor-provided simulator training.

(h)         Lessee shall pay when due all license fees and other fees and assessments necessary for the securing of all licenses, certificates of title and other permits required for the operation of the Aircraft. Lessee shall have no right to consent to any lien or liens on the Aircraft. Any liens (other than liens expressly permitted hereby or liens incurred by Lessor) shall be discharged at the sole cost and expense of Lessee, who shall indemnify and save Lessor harmless against any such lien or liens.

9.            DEFAULT: Time is of the essence of this Lease. The following shall constitute an event of default by Lessee hereunder and shall give rise to the rights on the part of Lessor described in Section 10 hereof: failure to pay any rent due hereunder within 30 days of becoming due or failure to make any other payment hereunder; material failure by Lessee to perform any other obligation or covenant of under this Lease; the making of a general assignment for the benefit of creditors by Lessee; the suspension of business or the commission by Lessee of any act amounting to a business failure; any change in, or termination of, Lessee’s corporate existence (except a merger, consolidation or reorganization in which the obligations of Lessee are assumed by the surviving corporation); the filing of a lien against Lessee that burdens the Aircraft, or Lessee’s interest in the Aircraft; or the institution of bankruptcy, reorganization, liquidation, receivership or similar proceedings by or against Lessee and, if instituted against Lessee, its consent thereto or the failure to cause such proceedings to be discharged or stayed within thirty (30) days thereafter.

10.         RIGHTS OF LESSOR UPON DEFAULT OF LESSEE: Upon the occurrence of any of the events of default described in Section 9 hereof Lessor may, in its discretion, do anyone or more of the following:

(a)   Whether or not the term of this Lease is terminated, take immediate possession of the Aircraft, wherever situated, and for such purpose enter upon any premises without liability for so doing. Lessor shall hold the Aircraft so repossessed free and clear of this Lease and of any of the rights of Lessee hereunder.

(b) Whether or not action has been taken under subsection (a) or (b) next above, sell, dispose of, hold, use or lease the Aircraft as Lessor, in its sole discretion, may decide, without any duty to account to Lessee with respect to such action or any proceeds thereof.

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After default, Lessee shall be liable for, and Lessor may recover from Lessee, (i) all unpaid rent to the date of such delivery or repossession, (n) all other sums payable by Lessee pursuant to the provisions of this Lease, (iii) all other losses and damages sustained by Lessor by reason of such default, and (iv) all costs and expenses incurred by Lessor by reason of such default.

11.         PREVENTION OF DEFAULT:   Any provision of this Lease to the contrary notwithstanding, Lessor shall exercise no right upon default by Lessee of other than a monetary default until ten (10) days after the giving of notice by Lessor to Lessee of such default and the failure of Lessee to cure such default prior to the expiration of such 10-day period.

12.         INDEMNITY: Lessee shall indemnify and hold Lessor harmless from and against any and all claims, demands, liabilities, losses, damages or injuries of whatever kind and nature (including attorneys’ fees), however caused, resulting directly or indirectly from or pertaining to Lessee’s possession, use, operation, maintenance or condition of the Aircraft. The foregoing indemnity shall not be affected by any termination of this Lease.

13.         TAXES: Lessee agrees to pay, and to indemnify and hold Lessor harmless from, all license and registration fees and all taxes, including without limitation, income, withholding, franchise, sales, use, ad valorem, value added, personal property,. stamp or other taxes, levies, imposts, duties, charges or withholdings of any nature (together with any penalties, fines or interest thereon) imposed against any such party or the Aircraft by any federal, state or local government or taxing authority in the United States or by any foreign government or any subdivision thereof upon or with respect to the Aircraft (excluding, however, federal, state and local taxes on, or measured by, the net income of Lessor) unless, and to the extent only, that any such tax, levy, impost, duty, charge or withholding is being contested by Lessee in good faith and by appropriate proceedings so long as such proceedings do not involve any danger of the sale, forfeiture or loss of the Aircraft or any interest therein. In case any report or return is required to be made with respect to any obligation under this Section 13, Lessee will either (after notice to Lessor) make such report or return in such manner as will show the ownership of the Aircraft in Lessor and send a copy of such report or return to Lessor or will notify Lessor of such requirement and make such report or return in such manner as shall be satisfactory to Lessor. All amounts payable to Lessor by Lessee pursuant to this Section 13 shall be payable on written demand by Lessor. All of the indemnities contained in this Section 13 shall continue in full force and effect notwithstanding the expiration or other termination of this Lease and are expressly made for the benefit of, and shall be enforceable by, Lessor, its successors and assigns.

14.         MISCELLANEOUS:

(a)          Inspection. Lessor shall have the right to inspect the Aircraft at any time upon 24 hours prior notice.

(b)          Late Payments. Lessee shall pay to Lessor interest at the rate of fifteen percent (15%) per annum, or the maximum amount permitted by applicable law, whichever is lesser, on all sums not paid by Lessee to Lessor when due and owing under any provision of this Lease from the date of delinquency until paid.

(c)          Rights and Remedies. Lessor’s rights and remedies in respect of any of the terms and conditions of this Lease shall be cumulative and not exclusive, and shall be in addition to all other rights and remedies in its favor.

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(d)          Non-waiver.  No party hereto shall, by act, delay, omission or otherwise, be deemed to have waived any of its rights or remedies hereunder unless such waiver is in writing and signed by the waiving party. A waiver by either party of any of its rights or remedies hereunder shall not be construed as a waiver of any succeeding breach or default in the same or any other term or condition hereof.

(e)          Modifications in Writing. Any change or modification to this Lease must be in writing and must be executed by the party against whom such amendment is sought to be enforced.

(f)          Entire Agreement. This Lease supersedes all prior agreements, oral or written, and all other communications regarding the subject matter hereof.

(g)          Headings. The headings used herein are for reference and convenience only and shall not enter into the interpretation hereof.

(h)          Governing Law. The validity, construction and performance of this Lease shall be governed by the laws of the State of Georgia, exclusive of choice of law provisions.

(i)          Severability. If any provision of this Lease is held by a court of competent jurisdiction to be unenforceable, the remaining provisions of this Lease will remain in full force and effect.

(j)          Survival. All amounts due hereunder, together with Sections 5, 10, 11 and 13 shall survive the expiration or termination of this Lease for any reason.

(k)          Accession.   All equipment, engines, radios, accessories, instruments and parts now or hereafter used in connection with the Aircraft shall become part of the Aircraft by accession.

(l)          Counterparts.   This Agreement may be executed by the parties hereto in separate counterparts, each of which when so executed and delivered shall be an original, but all such counterparts shall together constitute but one and the same instrument.

15.        NOTICE: If, under this Lease, one party is required to give notice to the other, such notice shall be deemed given if sent by certified or registered mail, national overnight courier, or telecopy, provided it is properly addressed or directed, to the intended recipient at recipient’s address or telecopy number set forth below:

To Lessor:

SDD Holdings, Inc.

c/o Innotrac Corporation

6465 East Johns Crossing, Suite 400

Johns Crossing, GA 30097

Attention: Scott Dorfman

Facsimile: (678) 584-8949

To Lessee:

c/o Innotrac Corporation

6465 East Johns Crossing, Suite 400

Johns Crossing, GA 30097

Attention: Chief Financial Officer

Facsimile:  (678) 584-8949

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Any such notice or communication will be deemed to have been duly given immediately if given or made in person or by telecopy (confirmed by the recipient), or one day after delivery by national courier, or three days after mailing (if given or made by mail), and in proving same it will be sufficient to show that the envelope containing the same was delivered to the delivery or postal service and duly addressed, or that receipt of a facsimile was confirmed by the recipient as provided above. Any party entitled to notice may change the address or facsimile number to which notices or other communications to such party will be delivered, mailed or transmitted by giving notice thereof to the parties hereto in the manner provided in this section.

16.         COMPLIANCE WITH FAA REGULATIONS SECTION 91.25: Lessee covenants that, in compliance with Section 91.25 of the FAA Regulations (14 C.F.R § 91.25), Lessee shall:

(a.)         mail a copy of this Lease to:

Aircraft Registration Branch

P.O. Box 25724

Oklahoma City, OK 73125

(b)          carry a copy of the Lease in the Aircraft, and the copy shall be available to the Federal Aviation Administrator or any person to whom he has delegated his authority in the matter concerned; and

(c)          at least 48 hours prior to the first flight of the Aircraft under this Lease, notify (by telephone or in person) the FAA Flight Standards Office nearest the airport where such flight will originate to inform the FAA of (i) the location of the airport of departure, (ii) the departure time, and (iii) the registration number of the Aircraft.

17.         TRUTH IN LEASING STATEMENT: In compliance with Section 91.23 of the FAA Regulations (14 C.F.R. § 91.23) the parties hereby acknowledge and agree as follows:

(a)          The Aircraft has been maintained and inspected under Chapter I of the Federal Aviation Administration’s Regulations (14 C.F.R. § 1.1 et seq.) within the 12 month period immediately preceding the date of the execution of this Lease. Lessee certifies that operations of the Aircraft under this Lease will comply with the applicable maintenance and inspection requirements of Part 91 of the Federal Aviation Administration’s Regulations.

(b)          Lessee shall be responsible for the operational control of the aircraft under this Lease and any extension hereof. Lessee certifies that it understands its responsibilities for compliance with applicable Federal Aviation Regulations.

Name: Innotrac Corporation

Address: 6465 East Johns Crossing, Suite 400, Johns Creek, GA 30097

Lessor certifies that it understands its responsibilities for Compliance with applicable Federal Aviation Regulations.

Name: SDD Holdings, Inc.

Address: c/o Innotrac Corporation, 6465 East Johns Crossing, Suite 400, Johns Creek, GA 30097

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(c)          An explanation of factors bearing on operational control and pertinent Federal Aviation Regulations can be obtained from the nearest FAA Flight Standards district office.

18.         TERMINATION OF ORIGINAL LEASE:   Upon the Commencement Date, the Original Lease shall be terminated in its entirety and shall be of no further force and effect. In the event that the Merger Agreement is terminated, this Lease shall automatically terminate and be of no effect and the Original Lease will remain in full force and effect.

[SIGNATURES APPEAR ON FOLLOWING PAGE]

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IN WITNESS WHEREOF, the parties hereto have executed this Amended and Restated Lease as of the day and year first above written.

SDD Holdings, Inc.
By:	/s/ Scott Dorfman
Name:   Scott Dorfman
Title:  President
Innotrac Corporation
By:	/s/ Stephen Keaveney
Name:  Stephen Keaveney
Title:  Chief Financial Officer

EX-10.4

Exhibit 10.4

AMENDED AND RESTATED
EMPLOYMENT AGREEMENT

This AMENDED AND RESTATED EMPLOYMENT AGREEMENT (the “Agreement”) is made as of November 14, 2013 (but effective as of the Commencement Date, as defined below), by and between Innotrac Corporation, a Georgia corporation (the “Company”), and Scott D. Dorfman (“Executive”).

RECITALS

A.          The Company and Executive are party to that certain Employment Agreement, dated as of April 16, 2007 (the “Existing Employment Agreement”).

B.           Immediately following the execution and delivery of this Agreement, the Company, Blue Eagle Holdings, L.P., a Delaware limited partnership (“Parent”), and Blue Eagle Acquisition Sub, Inc., a Georgia corporation and wholly owned subsidiary of Parent (“Purchaser”), will enter into that certain Agreement and Plan of Merger, dated as of the date hereof (the “Merger Agreement”).

C.           On the terms and subject to the conditions set forth in the Merger Agreement, (i) Purchaser will commence a tender offer to purchase (the “Offer”) all of the issued and outstanding shares of common stock of the Company, par value $0.10 per share (the “Common Stock”), at an offer price equal to the Offer Price (as defined in the Merger Agreement) payable to the seller in cash, without interest, subject to withholding of taxes required by applicable Law and (ii) following the consummation of the Offer and at the Effective Time (as defined in the Merger Agreement), Purchaser will merge with and into the Company (the “Merger”), with the Company continuing as the surviving corporation, whereby each issued and outstanding share of Common Stock (other than Excluded Shares (as defined in the Merger Agreement)) will be converted into the right to receive the Common Merger Consideration (as defined in the Merger Agreement) payable to the seller in cash, without interest, subject to withholding of taxes required by applicable Law.

D.           Simultaneous with the execution and delivery of this Agreement, the Company is entering into employment agreements (the “Other Employment Agreements”) with certain other executives of the Company (the “Other Executives”).

E.           As a condition and inducement to Parent and Purchaser entering into and incurring their respective obligations under the Merger Agreement, Executive and the Company have agreed to amend and restate the Existing Employment Agreement on the terms set forth herein.

NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth below, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Company and Executive agree as follows:

ARTICLE I
EMPLOYMENT SERVICES

1.1         Term of Employment. Executive’s employment under this Agreement shall commence and be effective at the Effective Time (the “Commencement Date”) and continue until terminated pursuant to Article III below (the “Employment Term”). This Agreement shall terminate automatically and will be of no force or effect upon any termination of the Merger Agreement in accordance with its terms prior to the occurrence of the Effective Time.

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1.2          Title and Position.  During the Employment Term, Executive shall hold the position of Chief Executive Officer of the Company, and in performing his duties hereunder, shall report directly to the Board of Directors of the Company (the “Board”). Executive shall also serve as a member of the Board during the Employment Term. Executive’s responsibilities shall include such duties as are commensurate with Executive’s position and as may be assigned to Executive in good faith by the Board.

1.3          Activities and Duties During Employment.

(a)          Executive shall conduct himself, both professionally and personally, with due regard to public conventions and morals, and in a manner that will not have a materially adverse effect on the business reputation of the Company or Executive. Executive shall devote Executive’s full business time, attention, skill and energy to the business and affairs of the Company and its subsidiaries, and shall use Executive’s reasonable best efforts to faithfully perform Executive’s responsibilities in a diligent, trustworthy, efficient and businesslike manner so as to advance the best interests of the Company. Notwithstanding the foregoing, Executive shall be permitted to devote a reasonable amount of time and effort to (i) serving on governing boards of or otherwise assisting civic and charitable organizations, and (ii) investing and managing personal and family investments, but only to the extent that activities described in clauses (i) or (ii), individually or as a whole, do not (A) involve Executive’s active participation in the management of any corporation, partnership or other business entity, (B) involve an ownership interest in any customer or vendor of the Company (other than through the passive ownership of less than one percent (1%) of the publicly traded shares of any entity) unless approved in advance by written resolution of the Board, (C) interfere with the Executive’s duties to the Company in any material respect, or (D) otherwise violate any provision of this Agreement in any material respect. Executive shall not have any ownership interest in any customer or vendor of Parent, the Company or any of their subsidiaries (other than through the passive ownership of less than one percent (1%) of the publicly traded shares of any entity) unless approved in advance by written resolution of the Board.

(b)          Executive shall comply in all material respects with all applicable laws, and all written policies, rules and regulations of the Company, including without limitation codes of conduct and any charter of the Board or any compensation committee of the Board (the “Committee”), as applicable.

ARTICLE II
COMPENSATION

2.1          Base Salary.   During the Employment Term, Executive shall receive an initial annual base salary of $426,950 (“Base Salary”), less applicable withholdings, payable in accordance with the general payroll practices of the Company (but no less infrequently than in equal monthly installments). The Base Salary will be reviewed by the Board or the Committee or its designee at least annually for increase (but not for decrease, except to the extent permitted under Section 3.2(c)(iii)(3)). As so adjusted, the Base Salary shall thereafter be Executive’s “Base Salary” for all purposes under this Agreement.

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2.2          Incentive Bonus.

(a)          The Company shall establish a performance-based bonus plan (the “Plan”) pursuant to which Executive shall be eligible to receive an annual incentive bonus (the “Annual Bonus”) with respect to each fiscal year of Company (“Fiscal Year”) ending during the Employment Term, subject to the achievement of financial performance objectives and “management by objective” goals as previously established by the Board in consultation with Executive, which objectives shall be reasonably related to the Company’s business objectives. The Board or the Committee shall administer the Plan, and shall have the sole discretion to determine if the goals have been attained and what percentage of Base Salary, if any, will be paid as an Annual Bonus; provided any such determinations are made reasonably and in good faith. To the extent the goals are financial in nature, the Board shall base its determination on the audit, review or compilation of the Company’s financial results submitted by the Company’s independent accountants, which determination shall be made within thirty (30) days of receipt by the Company of such audit, review or compilation (the date on which the Committee makes such determination, the “Bonus Determination Date”). Executive acknowledges that (i) no Annual Bonus shall be earned or accrued until the corresponding Bonus Determination Date and (ii) in order to receive an Annual Bonus with respect to a Fiscal Year, Executive must remain continuously employed by the Company through and including the first day of the Fiscal Year following the Fiscal Year to which such Annual Bonus relates and provided that Executive’s employment with the Company is not terminated by the Company for Cause prior to the Bonus Determination Date. The Annual Bonus shall be paid as soon as practicable after the Bonus Determination Date, but in no event later than December 31 of the Fiscal Year following the Fiscal Year for which the Annual Bonus relates. With respect to the Company’s 2013 Fiscal Year, Executive will be entitled to a Bonus under the Company’s 2013 Executive Bonus Plan (the “2013 Bonus”), which shall be paid as soon as practicable after the thirtieth (30^th) day following receipt by the Board of the Company’s audit for the 2013 Fiscal Year, but in no event later than December 31, 2014. Executive acknowledges that (x) the 2013 Bonus shall not be earned or accrued until the thirtieth (30^th) day following receipt by the Board of the Company’s audit for the 2013 Fiscal Year (the “2013 Bonus Determination Date”) and (y) in order to receive the 2013 Bonus, Executive must remain continuously employed by the Company through and including the first day of the Fiscal Year following the 2013 Fiscal Year and provided that Executive’s employment with the Company is not terminated by the Company for Cause prior to the 2013 Bonus Determination Date.

(b)          Should the Board determine that an Annual Bonus to Executive was based on an audit, review or compilation that is later found to be materially misstated or inaccurate in any material respect, the Board shall have the right to require Executive to remit to the Company any excess bonus amount paid as a result of such materially misstated or inaccurate audit, review or compilation (an “Excess Bonus Amount”). Executive shall remit the Excess Bonus Amount to the Company within 30 days after receiving written notice (an “Excess Bonus Notice”) from the Board describing the reason for overpayment and the Excess Bonus Amount due from Executive. Notwithstanding the foregoing, if an Excess Bonus Notice is first given at any time after the second anniversary of the date on which the corresponding Excess Bonus Amount was paid to Executive by the Company, and the determination of such Excess Bonus Amount does not, in any respect, relate to, or arise from, any acts or omissions in financial reporting or accounting practices that occurred at the direction, or with the knowledge, of Executive, then the Company’s right to recover such Excess Bonus Amount thereafter shall only be accomplished through the exercise of its right of offset in Section 6.8 (and subject to the limitations therein).

2.3          Reimbursement of Expenses; Fringe Benefits.  The Company shall reimburse Executive for all reasonable expenses incurred by Executive while performing Executive’s duties under this Agreement, subject to the Company’s policies in effect from time to time and corroborating documentation reasonably satisfactory to the Company. During the Employment Term, Executive shall also be entitled to receive reimbursement for payment of dues in the amount of $1,000 annually for membership in a business dining club in Atlanta, Georgia. During the Employment Term, the Company shall, at Company’s expense, provide Executive with use of a leased automobile comparable to the vehicle leased by the Company for Executive’s use as of the date hereof. The cost of all insurance, fuel, and repairs and maintenance for such vehicle shall be paid by the Company during the Employment Term.

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2.4          Health Care and Benefit Plans.   During the Employment Term, Executive shall be eligible to receive all fringe benefits and perquisites and entitled to participate in all incentive, savings and retirement plans, practices, policies and programs applicable generally to other senior-level executives of the Company and shall be eligible for participation in, and shall receive all benefits under, any health or welfare benefit plans, practices, policies and programs provided by the Company normally available to other senior-level executives of the Company (subject to all applicable eligibility and contribution policies and rules), as may be in effect from time to time, including such insurance programs as may be implemented by the Company (“Benefit Plans”).

2.5          Key Man Insurance.   Executive shall make application for, and submit to such examinations as may reasonably be requested by the Board in order to obtain key man or other insurance on the life of Executive for the benefit of the Company as the Board shall direct, the cost of which insurance shall be borne by the Company.

2.6          Vacation.  Executive shall receive four (4) weeks of paid vacation days per calendar year, to accrue pro rata on a monthly basis and to be administered in accordance with the Company’s policies and procedures (provided, however, that such policies shall not enhance Executive’s number of vacation days or otherwise conflict with this Section 2.6). Such vacation may be taken, in Executive’s discretion, subject to the reasonable business needs of the Company. Vacation time may not be carried over from one calendar year to the next, but rather must be used in the calendar year in which it is earned.

2.7          Aircraft Lease.  On the date hereof, the Company has entered an Amended and Restated Aircraft Lease in the form attached hereto as Exhibit A (the “Aircraft Lease”) with SDD Holdings, Inc., an Affiliate of Executive, which shall become effective on the Commencement Date and the Company and Executive shall keep in force during the Employment Term.

2.8          Amended and Restated Limited Partnership Agreement.  All Exchange Units (as such term is defined in the Contribution and Support Agreement, dated as of even date herewith, between Executive and Parent) owned by Executive shall be subject to the terms and conditions of the Amended and Restated Limited Partnership Agreement of Parent (the “Partnership Agreement”).

ARTICLE III
TERMINATION OF EMPLOYMENT

3.1          Employment At Will.   Executive’s employment by the Company is at-will, and either Executive or the Company may terminate Executive’s employment with the Company (the effective date of separation being the “Termination Date”), subject to the following:

(a)          The Company may terminate Executive’s employment at any time with Cause by giving written notice of such termination to Executive designating an immediate or future termination date.

(b)          Executive may terminate Executive’s employment for Good Reason or without Good Reason by giving the Company thirty (30) days prior written notice of termination. Upon such notice, the Company may, at its option, (i) make Executive’s termination effective immediately, (ii) require Executive to continue to perform Executive’s duties hereunder during such 30-day period, with or without restrictions on Executive’s activities, and/or (iii) accept Executive’s notice of termination as Executive’s resignation from the Company at any time during such 30-day period on behalf of the Company. If the Company elects (i) above, the Company shall have no obligation to provide Executive any compensation or benefits beyond the Termination Date except for payment of Executive’s Base Salary under Section 2.1 and benefits under Section 2.4 that have accrued through the Termination Date, any severance payments or benefits under Section 3.2, or as otherwise required by law. If the Company elects (ii) or (iii) above, the Company shall pay Executive’s Base Salary under Section 2.1 and benefits under Section 2.4 through the date on which Executive voluntarily ceases to perform services for the Company, in addition to payment of any severance payments or benefits to Executive under Section 3.2.

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(c)          Executive’s employment will terminate immediately without any notice upon Executive’s death. If the Company determines in good faith that Executive is Disabled or Incapacitated during the Employment Term (pursuant to the definition of Disabled or Incapacitated set forth below), the Company may give Executive written notice in accordance with Section 3(d) of its intention to terminate Executive’s employment. In such event, Executive’s employment with the Company shall terminate effective on the 30^th day after receipt of such notice by Executive (the “Disability Effective Date”); provided that within the 30-day period after such receipt, Executive shall not have returned to full time performance of Executive’s duties. For purposes of this Agreement, “Disabled or Incapacitated” means Executive’s inability or failure, due to a medically determinable physical or mental impairment, to substantially perform the essential functions of Executive’s job, with or without a reasonable accommodation, for thirty (30) consecutive calendar days or for ninety (90) calendar days during any twelve (12)-month period irrespective of whether such days are consecutive. Whether Executive is “Disabled or Incapacitated” shall be determined by a physician selected by the Company or its insurers, which physician is reasonably acceptable to Executive. Upon request, Executive shall provide the Board with documentation from Executive’s health care provider sufficient for the Board to determine the nature and extent of any physical or mental impairment that may interfere with Executive’s performance of Executive’s job duties, as well as any accommodations that could be made. If Executive’s employment is terminated pursuant to this Section 3.1(c), the Company shall have no obligation to provide Executive any compensation or benefits beyond the Termination Date except for payment of Executive’s Base Salary under Section 2.1 and benefits under Section 2.4 that have accrued through the Termination Date or as otherwise required by law.

(d)          Any termination by the Company for Cause or without Cause, or by Executive for Good Reason or without Good Reason, shall be communicated by Notice of Termination to the other party hereto given in accordance with Section 6.1 of this Agreement. For purposes of this Agreement, a “Notice of Termination” means a written notice which (i) indicates the specific termination provision in this Agreement relied upon, (ii) to the extent applicable, sets forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of Executive’s employment under the provision so indicated and (iii) if the Termination Date is other than the date of receipt of such notice, specifies the termination date. The failure by Executive or the Company to set forth in the Notice of Termination any fact or circumstance which contributes to a showing of Good Reason or Cause shall not waive any right of Executive or the Company hereunder or preclude Executive or Company from asserting such fact or circumstance in enforcing Executive’s or Company’s rights hereunder.

(e)          The “Termination Date” means (i) if Executive’s employment is terminated by Company for Cause or by Executive for Good Reason, the date of receipt of the Notice of Termination or any later date specified therein pursuant to Section 3(d), or as provided in Section 3.1(b), as the case may be, (ii) if Executive’s employment is terminated by the Company without Cause or by Executive without Good Reason, the effective date of separation, (iii) if Executive’s employment is terminated by reason of Disability, the Disability Effective Date, and (iv) if Executive’s employment is terminated by reason of death, the date of death.

3.2          Company Obligations Upon Termination.

(a)          If the Company terminates Executive’s employment without Cause or Executive terminates his employment for Good Reason, then the Company will provide Executive with the following severance payments and/or benefits:

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(i)          Prior to the thirtieth (30^th) day following the Termination Date, the Company shall pay to Executive in a lump sum, to the extent not previously paid, (x) the Base Salary through the Termination Date and (y) the Annual Bonus earned for any Fiscal Year ended prior to the year in which the Termination Date occurs, provided that Executive was employed on the last day of such Fiscal Year (the “Accrued Obligations”);

(ii)         Starting as of the next applicable Company payroll date after the Termination Date (provided Executive has complied with Section 3.2(b)), the Company will pay Executive a monthly amount equal to the (x) Base Salary, divided by (y) 12 (the “Cash Severance”), until the end of the eighteenth (18^th) month following the Termination Date (the “Severance Period”); and

(iii)        During the Severance Period, the Company shall continue the health and welfare benefits to Executive and, where applicable, Executive’s dependents on the same terms that would have been provided to them had Executive continued employment with Company in accordance with the health and welfare benefits provided pursuant to Section 2.4.

(b)          The obligations of the Company to make payments under Section 3.2(a) (other than the Accrued Obligations) are conditioned on Executive executing and delivering a general release of claims against the Company, its Affiliates, and each of their respective officers, directors, members, managers, partners and shareholders with respect to Executive’s employment, in substantially the form attached hereto as Exhibit B (the “Release”). If (i) the Board reasonably and in good faith believes that Executive has breached in any material respect any of Executive’s obligations in Article IV or (ii) Executive’s agrees to become employed by or to provide services to any entity that is an Affiliate of Sterling Fund Management, LLC, then the Board may unilaterally suspend Executive’s right to receive any Cash Severance then or thereafter due from Company to Executive, provided that in the case of clause (i), the Board (A) gives Executive advance written notice of such suspension and (B) initiates an action or claim to enforce Company’s rights in respect of such restrictive covenants promptly after such suspension. In the event that Company prevails on such action or claim, Executive’s right to receive, and Company’s obligation to pay, any additional Cash Severance, including any previously suspended amounts, shall be terminated immediately, and Executive shall have no further rights to Cash Severance. In the event that Executive prevails on such action or claim, Company shall be required to pay to Executive in a lump sum within thirty (30) days of such adjudication any Cash Severance the payment of which was delayed due to such suspension, plus interest for any period during which the payment of the Cash Severance was suspended at the prime rate, as published in the Wall Street Journal on the date of such suspension, and to commence payment of future installments of Cash Severance in accordance with Section 3.2(a)(ii) plus legal fees of Executive required in the defense.

(c)          For purposes of this Agreement:

(i)          The term “Affiliate” means, with respect to Parent: (A) any other entity or person owning 10% or more of the voting or beneficial interests of Parent; (B) the Company and any other entity or person directly or indirectly controlling, controlled by or under common control with Parent; or (C) any other entity in which more than 10% of the voting or beneficial interests are owned by one or more persons or entities who have a relationship with Parent described in clauses (A) or (B); provided that, for the purposes of this definition, “control” (including, with correlative meanings, the terms “controlled by” and “under common control with”), as used with respect to any person or entity, shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of such person or entity, whether through the ownership of voting securities, by contract or otherwise.

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(ii)         The term “Cause” means that Executive has: (A) engaged in (1) a material act of dishonesty involving the Company or its Affiliates, (2) malfeasance or gross negligence which is injurious to the Company, or (3) a material breach of his fiduciary duties related to employment; (B) committed an act of fraud or embezzlement, (C) committed any crime of moral turpitude or any felony; (D) repeatedly refused to perform specific reasonable directives from the Board that are reasonably consistent with the scope and nature of Executive’s responsibilities (other than such failure resulting from his disability or incapacity); (E) used or been under the influence of illegal drugs at the workplace or while performing Company business, or refused to submit for a drug test upon the Company’s reasonable request; (F) breached any provision of Article IV in any material respect; (G) failed to obtain the Board’s consent prior to causing the Company or any of its subsidiaries to engage in any business with any family members, their Affiliates or any entities they work with after the Commencement Date, except to the extent that (x) any such business relationship exists on the date hereof and (y) is disclosed on Exhibit C hereto; (H) caused, directed or permitted Parent, the Company or any of their subsidiaries to grant incentive equity to any person on terms and conditions not specifically approved by the Board or the Committee, or caused, directed or permitted the Company to pay bonuses or grant raises to employees or other service providers of the Company in amounts materially in excess of the ranges contemplated by the Company’s budget, as approved by the Board, or in contravention of the Committee’s charter; (I) willfully breached Executive’s other duties and obligations in Section 1.3 or any other written agreement between Executive and Parent or the Company in any material respect, or willfully took or failed to take any action in contravention of the Board charters in any material respect; or (J) willfully violated any conflict of interest policy of the Company or the Board in any material respect. A termination will not be for “Cause” pursuant to clauses (A)(3), (D), (G), (H), or (I), to the extent such conduct is curable, unless Company shall have notified Executive in writing describing such conduct and prescribing conduct required to cure such conduct and Executive shall have failed to cure such conduct within ten (10) business days after his receipt of such written notice. For purposes of this definition of Cause, no act or failure to act on the part of Executive shall be considered willful if it is done, or omitted to be done, by Executive in good faith and with a good faith belief that Executive’s act or omission was in the best interests of Company or the Parent. Subject to the foregoing, (x) the decision to terminate Executive’s employment for Cause, to take other action or to take no action in response to any occurrence shall be in the sole and exclusive discretion of the Board, and (y) Executive’s employment by the Company also shall be deemed terminated for Cause if Executive resigns from the Company and the Board determines in good faith that one or more of the events described above existed as of the time of such resignation.

(iii)        “Good Reason” means a resignation by Executive occasioned by any of the following events or conditions: (1) a relocation of the principal place of performance of Executive’s duties to a location more than fifty (50) miles from the Company’s principal office in Atlanta, Georgia (unless such new principal place of performance is within fifty (50) miles from the Executive’s then-permanent residence); (2) a material reduction in Executive’s authority, duties or responsibilities (including reporting responsibilities) without Executive’s prior written consent; (3) a material reduction in Executive’s Base Salary, unless such reduction in base salary is based on a Company action affecting all executive employees of the Company and the percentage reduction of Executive’s base salary is no greater than that applied to any other executive employee of the Company; (4) a material breach of this Agreement by the Company that has a material adverse effect on Executive; or (5) a failure by the Company to pay Executive any material portion of the Base Salary, bonus or other benefits owed to Executive; provided, however, that in order for any event or condition described in clauses (1) through (5) above to constitute Good Reason hereunder, Executive must:

(A)         give the Company written notice within ten (10) days after Executive first has actual knowledge of the event or condition, which written notice identifies the event or condition and explains why Executive believes that it constitutes Good Reason; and

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(B)         (1) provide the Company twenty (20) days from the date of service of the notice described in sub-clause (A) above to cure such event or condition(to the extent such conduct is curable), and (2) terminate Executive’s employment only if such event or condition remains, to the reasonable satisfaction of Executive, uncured by the Company as of the end of such 20-day period.

ARTICLE IV
RESTRICTIVE COVENANTS

4.1          Definitions.   For purposes of this Article IV:

(a)          the term “Business” means (i) the business of providing fulfillment services, order processing, call centers, customer care services, including e-commerce fulfillment or e-commerce return services, related software platform and application services and similar and related services that the Company or any of its subsidiaries are engaged in during the Employment Term and (ii) any other business that the Company or any of its subsidiaries has taken affirmative steps towards engaging in on or prior to the Termination Date;

(b)          the term “Confidential Information” shall mean any non-public information, in whatever form or medium, concerning the operations or affairs of the Business, including, but not limited to, (i) sales, sales volume, sales methods, sales proposals, business plans, advertising and marketing plans, strategic and long-range plans, and any information related to any of the foregoing, (ii) customers, customer lists, prospective customers and customer records, (iii) general price lists and prices charged to specific customers, (iv) trade secrets, (v) financial statements, budgets and projections, (vi) software owned or developed (or being developed) for use in or relating to the conduct of the Business, (vii) the names, addresses and other contact information of all vendors and suppliers and prospective vendors and suppliers of the Business, and (viii) all other confidential or proprietary information belonging to the Company or relating to the Business; provided, however, that Confidential Information shall not include (1) knowledge, data and information that is generally known or becomes known in the trade or industry of the Company (other than as a result of a breach of this Agreement or other agreement or instrument to which Executive is bound), and (2) knowledge, data and information gained without a breach of this Agreement on a non-confidential basis from a person who is not legally prohibited from transmitting the information to Executive;

(c)          the term “Company” shall be deemed to include Parent, the Company and all of their subsidiaries;

(d)          the term “Non-Compete Restricted Period” shall mean the period commencing on the Commencement Date and terminating twenty four (24) months following the termination of Executive’s employment or engagement with the Company;

(e)           the term “Non-Solicit Restricted Period” shall mean the period commencing on the Commencement Date and terminating twenty-four (24) months following the termination of Executive’s employment or engagement with the Company; and

(f)           the term “Prior Inventions” shall mean all inventions, original works of authorship, developments and improvements which were made by Executive, alone or jointly with others, prior to Executive’s employment, association or other engagement with the Company. To preclude any possibility of uncertainty, Executive has set forth on Exhibit D attached hereto a complete list of all Prior Inventions which Executive considers to be Executive’s property or the property of third parties and which Executive wishes to have excluded from the scope of this Agreement. If disclosure of any such Prior Invention on Exhibit D would cause Executive to violate any prior confidentiality agreement, Executive understands that Executive is not to list such Prior Invention in Exhibit D but is to inform the Company that all Prior Inventions have not been listed for that reason.

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4.2          Executive Acknowledgement. Executive agrees and acknowledges that, to ensure that the Company retains its value and goodwill, Executive must not use any Confidential Information, special knowledge of the Business, or the Company’s relationships with its customers and employees, all of which Executive will continue to gain access to through Executive’s employment with the Company, other than in furtherance of Executive’s legitimate job duties. Executive further acknowledges that:

(a)         the Company is currently engaged in the Business;

(b)         the Business is highly competitive and the services to be performed by Executive for the Company are unique and national in nature;

(c)          Executive will continue to occupy a position of trust and confidence with the Company and has acquired and will acquire an intimate knowledge of Confidential Information and the Company’s relationships with its customers and employees;

(d)         the agreements and covenants contained in this Article IV are essential to protect the Company, the Confidential Information and the goodwill of the Company and are being entered into in consideration for the various rights being granted to Executive under this Agreement;

(e)          the Company would be irreparably damaged if Executive were to disclose the Confidential Information or provide services to any person or entity in violation of the provisions of this Agreement;

(f)          the scope and duration of the covenants set forth in this Article IV are reasonably designed to protect a protectable interest of the Company and are not excessive in light of the circumstances; and

(g)          Executive has the means to support himself and Executive’s dependents other than by engaging in activities prohibited by this Article IV.

4.3          Confidential Information.

(a)          At all times both during Executive’s employment and following the termination of Executive’s employment for any reason, Executive shall: (i) hold the Confidential Information in strictest confidence, take all reasonable precautions to prevent the inadvertent disclosure of the Confidential Information to any unauthorized person, and follow all the Company’s policies protecting the Confidential Information; (ii) not use, copy, divulge or otherwise disseminate or disclose any Confidential Information, or any portion thereof, to any unauthorized person; (iii) not make, or permit or cause to be made, copies of the Confidential Information, except as necessary to carry out Executive’s authorized duties as an employee of the Company; and (iv) promptly and fully advise the Company of all facts known to Executive concerning any actual or threatened unauthorized use or disclosure of which Executive becomes aware.

(b)          Executive hereby assigns to the Company any rights Executive may have or acquire in the Confidential Information, and recognizes that the Company shall be the sole owner of all copyrights, trade secret rights, and all other rights throughout the world (collectively, “Proprietary Rights”) in connection with such rights.

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(c)          If Executive receives any subpoena or becomes subject to any legal obligation that might require Executive to disclose Confidential Information, Executive will provide prompt written notice of that fact to the Company, enclosing a copy of the subpoena and any other documents describing the legal obligation. In the event that the Company objects to the disclosure of Confidential Information, by way of a motion to quash or otherwise, Executive agrees to not disclose any Confidential Information while any such objection is pending.

(d)          Executive understands that the Company has and will receive from third parties confidential or proprietary information (“Third Party Information”) under a duty to maintain the confidentiality of such Third Party Information and to use it only for limited purposes. During the term of Executive’s association with the Company and at all times after the termination of such association for any reason, Executive will hold Third Party Information in strict confidence and will not disclose or use any Third Party Information unless expressly authorized by the Company in advance or as may be strictly necessary to perform Executive’s obligations with the Company, subject to any agreements binding on the Company with respect to such Third Party Information.

(e)          Executive will not improperly use or disclose any confidential information or trade secrets, if any, of any former employer or of any other person to whom Executive has an obligation of confidentiality, and Executive will not bring onto the Company’s premises any unpublished documents or any property belonging to any former employer or of any other person to whom Executive has an obligation of confidentiality.

4.4          Ownership of Inventions.

(a)          Executive hereby agrees that any and all inventions (whether or not an application for protection has been filed under patent laws), works of authorship, information fixed in any tangible medium of expression (whether or not protected under copyright laws), Moral Rights, mask works, trademarks, trade names, trade dress, trade secrets, publicity rights, know-how, ideas (whether or not protected under trade secret laws), and all other subject matter protected under patent, copyright, Moral Right (defined as any right to claim authorship of a work, any right to object to any distortion or other modification of a work, and any similar right, existing under the law of any country, or under any treaty), mask work, trademark, trade secret, or other laws, that have been, are or will be developed, generated or produced by Executive, solely or jointly with others, at any time while employed by the Company, including during the Employment Term, are and shall be the exclusive property of the Company, subject to the obligations of this Article IV with respect to Confidential Information, and Executive hereby forever waives and agrees never to assert against the Company, its successors or licensees any and all ownership, interest, Moral Rights or similar rights with respect thereto. Executive hereby assigns to the Company all right, title and interest to the foregoing inventions, concepts, ideas and materials. This Section 4.4 does not apply to any invention or other work of Executive for which no equipment, supplies, facility or Confidential Information of the Company was used and that was developed entirely on Executive’s own time, unless the invention (A) relates to (x) the Business or (y) the Company’s actual or demonstrably anticipated research or development, or (B) results from any work performed by Executive for or on behalf of the Company. Executive shall keep and maintain adequate and current written records of all inventions, concepts, ideas and materials made by Executive (jointly or with others) during the term of Executive’s association or employment with the Company. Such records shall remain the property of the Company at all times. Executive shall promptly and fully disclose to the Company the nature and particulars of any Inventions or research project undertaken on the Company’s behalf.

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(b)          Unless the parties otherwise agree in writing, Executive is under no obligation to incorporate any Prior Inventions in any of Company’s products or processes or other Company Invention. If, in the course of Executive’s performance, Executive chooses to incorporate into any such Company product or process or other Company Invention any Prior Invention owned by Executive or in which Executive otherwise has an interest, Executive grants the Company a non-exclusive, royalty free, irrevocable, perpetual, world-wide license to copy, reproduce, make and have made, modify and create derivative works of, use, sell and license such Prior Inventions and derivative works as part of or in connection with any such Company product or process or other Company Invention.

(c)          During or subsequent to the Employment Term, Executive shall execute all papers, and otherwise provide assistance, at the Company’s reasonable request and expense, to enable the Company or its nominees to obtain and enforce all proprietary rights with respect to the Company Inventions (as defined below) in any and all countries. To that end, Executive will execute, verify and deliver such documents and perform such other acts (including appearances as a witness) as the Company may reasonably request for use in applying for, obtaining, perfecting, defending, evidencing and enforcing any such proprietary rights, and the assignment of any or all of such proprietary rights. In addition, Executive will execute, verify and deliver assignments of such rights to the Company or its designee. Executive’s obligation to assist the Company with respect to such rights shall continue beyond the termination of Executive’s association with the Company.

(d)          If, after reasonable effort, the Company cannot secure Executive’s signature on any document needed in connection with the actions specified in the preceding paragraph, Executive irrevocably designates and appoints the Company and its duly authorized officers and agents as Executive’s agent and attorney-in-fact, to act for and in Executive’s behalf to execute, verify and file any such documents and to do all other lawfully permitted acts to further the purposes of the preceding paragraph with the same legal force and effect as if executed by Executive. The power of attorney set forth in this Section 4.4 is coupled with an interest, is irrevocable, and shall survive Executive’s death, incompetence or incapacity and the termination of the Employment Term. Executive waives and quitclaims to the Company all claims of any nature whatsoever which Executive now has or may in the future obtain for infringement of any Proprietary Rights assigned under this Agreement or otherwise to the Company.

(e)          Executive acknowledges that all original works of authorship which are made by Executive (solely or jointly with others) during the course of the association with or performance of services for the Company and which are protectable by copyright are “works made for hire,” as that term is defined in the United States Copyright Act and any successor statutes. Inventions assigned to the Company or as directed by the Company under this Agreement or otherwise are referred to as “Company Inventions.”

4.5          Non-Solicitation.

(a)          During the Non-Solicit Restricted Period, Executive shall not (other than in furtherance of Executive’s legitimate job duties on behalf of Company), directly or indirectly, on Executive’s own behalf or for any other person or entity:

(i)          solicit for employment or hire, attempt to solicit for employment or hire, or employ or hire, any person who is or was employed by the Company at any time within six (6) months prior to the solicitation or hire (the “Restricted Personnel”);

(ii)         seek to influence any Restricted Personnel to leave the Company’s employment, engagement, or service; or

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(iii)        otherwise interfere with the relationship between any Restricted Personnel and the Company.

(b)          During the Non-Solicit Restricted Period, Executive shall not (other than in furtherance of Executive’s legitimate job duties on behalf of Company), directly or indirectly, on Executive’s own behalf or for any other person or entity:

(i)          solicit, entice or induce any customer that did business with the Company in the last two (2) years of Executive’s employment or any prospective customer of the Company (the “Restricted Customers”) to become a customer of any person or entity other than the Company with respect to products or services sold or under development by the Company as of Executive’s termination;

(ii)         sell, promote, or provide any product or services to a Restricted Customer if that product or service could otherwise be provided by the Company; or

(iii)        solicit, entice, induce, or assist any Restricted Customer to reduce or cease doing business with the Company or otherwise interfere with the relationship between any Restricted Customer and the Company.

4.6          Non-Competition; Investment Opportunities.

(a)          During the Non-Compete Restrictive Period, Executive shall not, directly or indirectly, alone or in combination with any other individual or entity, (i) own (other than through the passive ownership of less than one percent (1%) of the publicly traded shares of any entity), operate, manage, control, or participate in an executive, managerial, strategic, or sales role, in any individual or entity (other than the Company) that engages in or proposes to engage in the Business in the United States and any other country in which Executive worked for the Company (a “Competitive Business”); or (ii) otherwise render services to (as an employee, consultant, independent contractor or otherwise) a Competitive Business that are similar to the services Executive rendered to the Company, or that could involve the use of Confidential Information; and

(b)          During the Employment Term, if Executive learns of any investment opportunity in a business or any entity engaged in the Business, Executive shall present such investment opportunity to the Company.

4.7          If any court of competent jurisdiction shall deem any provision in this Article IV too restrictive, the other provisions shall stand, and the court shall modify the unduly restrictive provision to the point of greatest restriction permissible by law.

4.8          If this Agreement is terminated for any reason, Executive acknowledges and agrees that the restrictive covenants set forth in this Article IV (the “Restrictive Covenants”) shall survive the termination of this Agreement and Executive shall continue to be bound by the terms of this Article IV as if this Agreement was still in effect.

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4.9          The Company and Executive agree that damages will accrue to the Company by reason of Executive’s failure to observe any of the Restrictive Covenants. Therefore, if the Company shall institute any action or proceeding to enforce such provisions, Executive waives the claim or defense that there is an adequate remedy at law and agrees in any such action or proceeding not to (i) interpose the claim or defense that such remedy exists at law, or (ii) require the Company to show that monetary damages cannot be measured or to post any bond. Without limiting any other remedies that may be available to the Company, Executive hereby specifically affirms the appropriateness of injunctive or other equitable relief in any such action. Executive also acknowledges that the remedies afforded the Company pursuant to this Section 4.9 are not exclusive, nor shall they preclude the Company from seeking or receiving any other relief, including without limitation, any form of monetary or other equitable relief. Upon the reasonable request by the Company, Executive shall provide reasonable assurances and evidence of compliance with the Restrictive Covenants.

ARTICLE V
POST-TERMINATION OBLIGATIONS

5.1          Return of Company Materials.   No later than three (3) business days following the termination of Executive’s employment for any reason, Executive shall return to the Company, and shall not retain in any form or media of expression, all Company and Affiliate property that is then in Executive’s possession, custody or control, including, without limitation, all keys, access cards, credit cards, computer hardware and software, documents, records, policies, marketing information, design information, specifications and plans, data base information and lists, and any other property or information that Executive has or had relating to the Company or any Affiliate (whether those materials are in paper or computer-stored form), and including but not limited to any documents containing, summarizing, or describing any Confidential Information. Notwithstanding the foregoing, at any time after the Commencement Date, Executive shall be permitted to remove (i) all of his personal property from the Company’s offices including all personal memorabilia and business memorabilia collected by Executive in connection with business transacted prior to the Commencement Date, and (ii) his personal laptop computer and all office furniture located in the Executive’s office in Johns Creek, Georgia as of the Commencement Date. After termination of Executive’s employment with the Company, the Company agrees at the cost and expense of Executive to transfer the Executive’s cell phone telephone number to Executive. To the extent that there is data of the Company located on Executive’s computer or other electronic device, Executive shall after the termination of his employment be entitled to retain his personal Microsoft Outlook list of contacts and Executive will work in good faith with Employer to transfer from Executive’s computer Confidential Information of the Company or any Affiliate thereof.

5.2          Executive Assistance.   During the Employment Term and for a reasonable period thereafter, Executive shall, upon reasonable notice, assist the Company and its subsidiaries (the “Affiliated Group”) in the defense of any claims, or potential claims that may be made or threatened to be made against any member of the Affiliated Group in any action, suit or proceeding, whether civil, criminal, administrative, investigative or otherwise (a “Proceeding”), and will assist the Affiliated Group in the prosecution of any claims that may be made by any member of the Affiliated Group in any Proceeding, to the extent that such claims may relate to Executive’s employment or the period of Executive’s employment by the Company. The Company shall reimburse Executive for all of the Executive’s reasonable out-of-pocket expenses associated with such assistance, including travel expenses and any attorneys’ fees and shall pay a reasonable per diem fee for the Executive’s service under this Section 5.2. Any services or assistance contemplated in this Section 5.2 shall be at mutually agreed to and convenient times.

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ARTICLE VI
MISCELLANEOUS

6.1          Notices.  Any notices, consents or other communications required or permitted to be sent or given hereunder shall be in writing and shall be deemed properly served if (i) delivered personally, in which case the date of such notice shall be the date of delivery; (ii) delivered to a nationally recognized overnight courier service, in which case the date of delivery shall be the next business day; or (iii) sent by facsimile transmission (with a copy sent by first-class mail), in which case the date of delivery shall be the date of transmission, or if after 5:00 P.M., the next business day. If not personally delivered, notice shall be sent addressed as follows: (x) if to Executive, to the address listed on the signature page hereof, and (y) if to the Company, at c/o Sterling Partners, 401 North Michigan Avenue, Suite 3300, Chicago, IL 60611, Attention: Office of General Counsel, Facsimile No. (312) 465-7100, or in either case at such other address as may hereafter be specified by notice given by either party to the other party. Executive shall promptly notify the Company of any change in his address set forth on the signature page.

6.2          Successors and Assigns.  This Agreement shall be binding upon, and inure to the benefit of, and be enforceable by, the parties hereto and the Company’s successors and permitted assigns. In the case of the Company, the successors and permitted assigns hereunder shall include without limitation any Affiliate as well as the successors in interest to the Company or any such Affiliate (whether by merger, liquidation (including successive mergers or liquidations) or otherwise). This Agreement or any right or interest hereunder is one of personal service and may not be assigned by Executive under any circumstance. Nothing in this Agreement, whether expressed or implied, is intended or shall be construed to confer upon any person other than the parties and successors and assigns permitted by this Section 6.2 any right, remedy or claim under or by reason of this Agreement.

6.3          Entire Agreement; Amendments.   This Agreement, the Exhibits hereto and the Partnership Agreement embody the complete agreement and understanding of the parties hereto with regard to the subject matter hereof and supersede and preempt any prior agreements, understandings, letters of intent, or representations by or among the parties, written or oral, which may have related to the subject matter hereof. This Agreement shall not be amended, modified or supplemented except by a written instrument signed by each of the parties hereto.

6.4          Interpretation.   Article titles and section headings contained herein are inserted for convenience of reference only and are not intended to be a part of or to affect the meaning or interpretation of this Agreement.

6.5          Waivers.  No provision of this Agreement may be waived except in a writing executed and delivered by the party against whom waiver is sought. Any such written waiver shall be effective only with respect to the event or circumstance described therein and not with respect to any other event or circumstance, unless such waiver expressly provides to the contrary.

6.6          Partial Invalidity.  Wherever possible, each term and provision of this Agreement shall be interpreted so as to be effective and valid under applicable law. If any term or provision shall be held invalid or unenforceable, the remaining terms and provisions hereof not be affected thereby, unless such a construction would be unreasonable. Executive’s obligations in Articles IV and V shall survive and continue in full force notwithstanding the termination of this Agreement or Executive’s employment for any reason.

6.7          Tax Matters.  Executive acknowledges that no representative or agent of Parent or the Company has provided Executive with any tax advice of any nature, and Executive has had the opportunity to consult with his own legal, tax and financial advisor(s) as to tax and related matters concerning the compensation to be received under this Agreement.

6.8          Offset.  To the extent permitted by law, and to the extent that such action will not result in the imposition of additional taxes, interest or penalties pursuant to Section 409A (as defined below), the Company may offset any amounts Executive owes it pursuant to this Agreement or any other written agreement, note or other instrument relating to indebtedness for borrowed money to which Executive is a party or pursuant to any other liability or obligation by which Executive is bound against any amounts it owes Executive hereunder.

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6.9          Execution in Counterparts.    This Agreement may be executed in one or more counterparts, each of which shall be considered an original instrument, but all of which shall be considered one and the same agreement.

6.10        Required Delay for Deferred Compensation Under 409A.  Notwithstanding any other provision of this Agreement, if at the time of separation from service Executive is determined by the Company to be a “specified employee” (as defined in Section 409A of the Code (together, with any state law of similar effect, “Section 409A”) and Section 1.409A-1(i) of the Treasury Regulations), and the Company determines that delayed commencement of any portion of the termination payments and benefits payable to Executive pursuant to this Agreement is required in order to avoid a prohibited distribution under Section 409A(a)(2)(B)(i) of the Code, then such portion of Executive’s termination payments and benefits shall not be provided to Executive prior to the earliest of (1) the date that is six months and one day after Executive’s separation from service, (2) the date of Executive’s death or (3) such earlier date as is permitted under Section 409A (any such delayed commencement, a “Payment Delay”). Upon the expiration of such Payment Delay, all payments deferred pursuant to a Payment Delay shall be paid in a lump sum to Executive on the first day following the expiration of the Payment Delay, and any remaining payments due under the Agreement shall be paid on the original schedule provided herein.

This Agreement is intended to meet the requirements of Section 409A, and shall be interpreted and construed consistent with that intent. References to termination of employment, retirement, separation from service and similar or correlative terms in this Agreement shall mean a “separation from service” (as defined at Section 1.409A-1(h) of the Treasury Regulations) from the Company and from all other corporations and trades or businesses, if any, that would be treated as a single “service recipient” with the Company under Section 1.409A-1(h)(3) of the Treasury Regulations. Each installment of the payments and benefits provided for in this Agreement shall be treated as a separate “payment” for purposes of Treasury Regulation Section 1.409A-2(b)(2)(i).

6.11         Governing Law; Consent to Jurisdiction; Waiver of Jury.  This Agreement shall be governed by and construed in accordance with the internal laws of the State of Georgia, without regard to its conflict of law principles. For the purposes of any suit, action, or other proceeding arising out of this Agreement or with respect to Executive’s employment hereunder, the Parties hereto: (i) agree to submit to the exclusive jurisdiction of the federal or state courts located in Fulton County, State of Georgia, (ii) agree to unconditionally waive any objection to venue in such jurisdiction, and agree not to plead or claim forum non conveniens, and (iii) to waive their respective rights to a jury trial of any and such claims and causes of action.

6.12         Construction.  The language used in this Agreement will be deemed to be the language chosen by Executive and the Company to express their mutual intent, and no rule of strict construction will be applied against Executive or the Company.

6.13         Indemnification.   The Company shall indemnify (and provide advancement of expenses to) Executive to the maximum extent permitted under the Georgia Business Corporation Code for acts taken within the scope of his service as a director of the Company. To the extent that the Company obtains coverage under a director and officer indemnification policy, Executive will be entitled to such coverage on a basis that is no less favorable than the coverage provided to any other officer or director of the Company.

*         *         *

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IN WITNESS WHEREOF, the Company has caused this Amended and Restated Employment Agreement to be duly executed by an officer thereunto duly authorized, and Executive has hereunto set his hand, all as of the day and year first above written.

THE COMPANY:
INNOTRAC CORPORATION
By:	/s/ Stephen Keaveney
Name:   Stephen Keaveney
Title:     Chief Financial Officer
EXECUTIVE:
/s/ Scott D. Dorfman
Name:  Scott D. Dorfman
Address:  [REDACTED]
	[REDACTED]
Phone:	[REDACTED]
Fax:

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Exhibit A

Aircraft Lease

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Exhibit B

Form of Release

THIS RELEASE (the “Release”) is entered into between Scott D. Dorfman (“Executive”) and Innotrac Corporation, a Georgia corporation (the “Company”), for the benefit of the Company. The entering into and non-revocation of this Release is a condition to Executive’s right to receive the payments under Section 3.2 of the Amended and Restated Employment Agreement entered into by and between Executive and the Company, dated as of November 14, 2013 (the “Employment Agreement”). Capitalized terms used and not defined herein shall have the meaning provided in the Employment Agreement.

Accordingly, Executive and the Company agree as follows.

1.           In consideration for the payments and other benefits provided to Executive under Section 3.2(a) of the Employment Agreement, Executive represents and agrees, as follows:

(a)          Executive, for himself, his heirs, administrators, representatives, executors, successors and assigns (collectively “Releasers”), hereby irrevocably and unconditionally releases, acquits and forever discharges and agrees not to sue the Company or any of its parents, subsidiaries, divisions, affiliates and related entities and its current and former directors, officers, shareholders, trustees, employees, consultants, independent contractors, representatives, agents, servants, successors and assigns and all persons acting by, through or under or in concert with any of them (collectively “Releasees”), from all claims, rights and liabilities up to and including the date of this Release arising from or relating to Executive’s employment with, or termination of employment from, the Company, under the Employment Agreement and from any and all charges, complaints, claims, liabilities, obligations, promises, agreements, controversies, damages, actions, causes of actions, suits, rights, demands, costs, losses, debts and expenses of any nature whatsoever, known or unknown, suspected or unsuspected and any claims of wrongful discharge, breach of contract, implied contract, promissory estoppel, defamation, slander, libel, tortious conduct, employment discrimination or claims under any federal, state or local employment statute, law, order or ordinance, including any rights or claims arising under Title VII of the Civil Rights Act of 1964, as amended, the Age Discrimination in Employment Act of 1967, as amended, 29 U.S.C. § 621 et seq. (“ADEA”), or any other federal, state or municipal ordinance relating to discrimination in employment. Nothing contained herein shall restrict the parties’ rights to enforce the terms of this Release.

(b)          To the maximum extent permitted by law, Executive agrees that he has not filed, nor will he ever file, a lawsuit asserting any claims which are released by this Release.

(c)          This Release specifically excludes Executive’s rights and the Company’s obligations under Sections 3.2 and 6.14 of the Employment Agreement, the Benefit Plans, and the Partnership Agreement. Executive’s entitlement to vested benefits under the Benefit Plans and the Partnership Agreement shall be determined in accordance with the provisions of the Benefit Plans or the Partnership Agreement, as the case may be. Nothing contained in this Release shall release Executive from his obligations, including any obligations to abide by restrictive covenants, under the Employment Agreement, the Partnership Agreement or the Benefit Plans that continue or are to be performed following termination of employment.

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(d)          The parties agree that this Release shall not affect the rights and responsibilities of the US Equal Employment Opportunity Commission (hereinafter “EEOC”) to enforce ADEA and other laws. In addition, the parties agree that this Release shall not be used to justify interfering with Executive’s protected right to file a charge or participate in an investigation or proceeding conducted by the EEOC. The parties further agree that Executive knowingly and voluntarily waives all rights or claims (that arose prior to Executive’s execution of this Release) the Releasers may have against the Releasees, or any of them, to receive any benefit or remedial relief (including, but not limited to, reinstatement, back pay, front pay, damages, attorneys’ fees, experts’ fees) as a consequence of any investigation or proceeding conducted by the EEOC.

2.          Executive acknowledges that the Company has specifically advised him of the right to seek the advice of an attorney concerning the terms and conditions of this Release. Executive further acknowledges that he has been furnished with a copy of this Release, and he has been afforded twenty-one (21) days in which to consider the terms and conditions set forth above prior to this Release. By executing this Release, Executive affirmatively states that he has had sufficient and reasonable time to review this Release and to consult with an attorney concerning his legal rights prior to the final execution of this Release. Executive further agrees that he has carefully read this Release and fully understands its terms. Executive understands that he may revoke this Release within seven (7) days after signing this Release. Revocation of this Release must be made in writing and must be received by [●] at [●] within the time period set forth above.

3.          This Release will be governed by and construed in accordance with the laws of the state of Georgia, without giving effect to any choice of law or conflicting provision or rule (whether of the state of Georgia or any other jurisdiction) that would cause the laws of any jurisdiction other than the state of Georgia to be applied. In furtherance of the foregoing, the internal law of the state of Georgia will control the interpretation and construction of this agreement, even if under such jurisdiction’s choice of law or conflict of law analysis, the substantive law of some other jurisdiction would ordinarily apply. The provisions of this Release are severable, and if any part or portion of it is found to be unenforceable, the other paragraphs shall remain fully valid and enforceable. This Release shall become effective and enforceable on the eighth day following its execution by Executive, provided he does not exercise his right of revocation as described above. If Executive fails to sign and deliver this Release or revokes his signature, this Release will be without force or effect, and Executive shall not be entitled to the payment under Section 3.2 of the Employment Agreement.

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Exhibit C

Business Relationships with Family Members

1. The Company utilizes HARP Ink, a print broker, for services relating to the printing of materials. HARP Ink is owned by Hy Dorfman, the brother of Scott Dorfman, and Hy Dorfman’s wife.

2. Mindy Dorfman, Scott Dorfman’s sister, is employed by the Company as a client services director responsible for managing and developing relationships

3. Brad Dorfman, Scott Dorfman’s son, is employed by the Company as a business development associate.

4. Ben Holt, Scott Dorfman’s son-in-law, is employed by the Company as a manager in the Cedars warehouse in Lawrenceville, Georgia.

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Exhibit D

Prior Inventions

None.

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EX-10.5

Exhibit 10.5

AMENDED AND RESTATED
EMPLOYMENT AGREEMENT

This AMENDED AND RESTATED EMPLOYMENT AGREEMENT (the “Agreement”) is made as of November 14, 2013 (but effective as of the Commencement Date, as defined below (other than Section 6.13, which shall be effective as of the date hereof), by and between Innotrac Corporation, a Georgia corporation (the “Company”), and Robert Toner (“Executive”).

RECITALS

A.          The Company and Executive are party to that certain Employment Agreement, dated as of April 22, 2010 (the “Existing Employment Agreement”).

B.           Immediately following the execution and delivery of this Agreement, the Company, Blue Eagle Holdings, L.P., a Delaware limited partnership (“Parent”), and Blue Eagle Acquisition Sub, Inc., a Georgia corporation and wholly owned subsidiary of Parent (“Purchaser”), will enter into that certain Agreement and Plan of Merger, dated as of the date hereof (the “Merger Agreement”).

C.           On the terms and subject to the conditions set forth in the Merger Agreement, (i) Purchaser will commence a tender offer to purchase (the “Offer”) all of the issued and outstanding shares of common stock of the Company, par value $0.10 per share (the “Common Stock”), at an offer price equal to the Offer Price (as defined in the Merger Agreement) payable to the seller in cash, without interest, subject to withholding of taxes required by applicable Law and (ii) following the consummation of the Offer and at the Effective Time (as defined in the Merger Agreement), Purchaser will merge with and into the Company (the “Merger”), with the Company continuing as the surviving corporation, whereby each issued and outstanding share of Common Stock (other than Excluded Shares (as defined in the Merger Agreement)) will be converted into the right to receive the Common Merger Consideration (as defined in the Merger Agreement) payable to the seller in cash, without interest, subject to withholding of taxes required by applicable Law.

D.           Simultaneous with the execution and delivery of this Agreement, the Company is entering into employment agreements (the “Other Employment Agreements”) with certain other executives of the Company (the “Other Executives”).

E.           As a condition and inducement to Parent and Purchaser entering into and incurring their respective obligations under the Merger Agreement, Executive and the Company have agreed to amend and restate the Existing Employment Agreement on the terms set forth herein.

NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth below, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Company and Executive agree as follows:

ARTICLE I
EMPLOYMENT SERVICES

1.1         Term of Employment.   Executive’s employment under this Agreement shall commence and be effective at the Effective Time (the “Commencement Date”) and continue until terminated pursuant to Article III below (the “Employment Term”). This Agreement shall terminate automatically and will be of no force or effect upon any termination of the Merger Agreement in accordance with its terms prior to the occurrence of the Effective Time.

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1.2          Title and Position.   During the Employment Term, Executive shall hold the position of Chief Operating Officer of the Company, and shall report directly to the Chief Executive Officer of the Company. Executive’s responsibilities shall include such duties as are commensurate with Executive’s position and as may be assigned to Executive in good faith by the Board of Directors of the Company (the “Board”) or the Chief Executive Officer.

1.3          Activities and Duties During Employment.

(a)          Executive shall conduct himself, both professionally and personally, with due regard to public conventions and morals, and in a manner that will not have a materially adverse effect on the reputation of the Company or Executive. Executive shall devote Executive’s full business time, attention, skill and energy to the business and affairs of the Company and its subsidiaries, and shall use Executive’s reasonable best efforts to faithfully perform Executive’s responsibilities in a diligent, trustworthy, efficient and businesslike manner so as to advance the best interests of the Company. Notwithstanding the foregoing, Executive shall be permitted to devote a reasonable amount of time and effort to (i) serving on governing boards of or otherwise assisting civic and charitable organizations, and (ii) investing and managing personal and family investments, but only to the extent that activities described in clauses (i) or (ii), individually or as a whole, do not (A) involve Executive’s active participation in the management of any corporation, partnership or other business entity, (B) involve an ownership interest in any customer or vendor of the Company unless approved in advance by written resolution of the Board, (C) interfere with the Executive’s duties to the Company in any material respect, or (D) otherwise violate any provision of this Agreement in any material respect. Executive shall not have any ownership interest in any customer or vendor of Parent the Company or any of their subsidiaries unless approved in advance by written resolution of the Board.

(b)          Executive shall comply in all material respects with all applicable laws, and all written policies, rules and regulations of the Company, including without limitation codes of conduct and any charter of the Board or any compensation committee of the Board (the “Committee”), as applicable.

ARTICLE II
COMPENSATION

2.1          Base Salary.   During the Employment Term, Executive shall receive an initial annual base salary of $300,000 (“Base Salary”), less applicable withholdings, payable in accordance with the general payroll practices of the Company(but no less infrequently than in equal monthly installments). The Base Salary will be reviewed by the Board or the Committee or its designee at least annually for increase (but not for decrease, except to the extent permitted under Section 3.2(c)(iii)(3)). As so adjusted, the Base Salary shall thereafter be Executive’s “Base Salary” for all purposes under this Agreement.

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2.2          Incentive Bonus.

(a)          The Company shall establish a performance-based bonus plan (the “Plan”) pursuant to which Executive shall be eligible to receive an annual incentive bonus (the “Annual Bonus”) with respect to each fiscal year of Company (“Fiscal Year”) ending during the Employment Term, subject to the achievement of financial performance objectives and “management by objective” goals as previously established by the Board in consultation with the Chief Executive Officer, which objectives shall be reasonably related to the Company’s business objectives. The Board or the Committee shall administer the Plan, and shall have the sole discretion to determine if the goals have been attained and what percentage of Base Salary, if any, will be paid as an Annual Bonus; provided any such determinations are made reasonably and in good faith. To the extent the goals are financial in nature, the Board shall base its determination on the audit, review or compilation of the Company’s financial results submitted by the Company’s independent accountants, which determination shall be made within thirty (30) days of receipt by the Company of such audit, review or compilation (the date on which the Committee makes such determination, the “Bonus Determination Date”). Executive acknowledges that (i) no Annual Bonus shall be earned or accrued until the corresponding Bonus Determination Date and (ii) in order to receive an Annual Bonus with respect to a Fiscal Year, Executive must remain continuously employed by the Company through and including the first day of the Fiscal Year following the Fiscal Year to which such Annual Bonus relates and provided that Executive’s employment with the Company is not terminated by the Company for Cause prior to the Bonus Determination Date. The Annual Bonus shall be paid as soon as practicable after the Bonus Determination Date, but in no event later than December 31 of the Fiscal Year following the Fiscal Year for which the Annual Bonus relates. With respect to the Company’s 2013 Fiscal Year, Executive will be entitled to a Bonus under the Company’s 2013 Executive Bonus Plan (the “2013 Bonus”), which shall be paid as soon as practicable after the thirtieth (30^th) day following receipt by the Board of the Company’s audit for the 2013 Fiscal Year, but in no event later than December 31, 2014. Executive acknowledges that (x) the 2013 Bonus shall not be earned or accrued until the thirtieth (30^th) day following receipt by the Board of the Company’s audit for the 2013 Fiscal Year (the “2013 Bonus Determination Date”) and (y) in order to receive the 2013 Bonus, Executive must remain continuously employed by the Company through and including the first day of the Fiscal Year following the 2013 Fiscal Year and provided that Executive’s employment with the Company is not terminated by the Company for Cause prior to the 2013 Bonus Determination Date.

(b)          Should the Board determine that an Annual Bonus to Executive was based on an audit, review or compilation that is later found to be materially misstated or inaccurate in any material respect, the Board shall have the right to require Executive to remit to the Company any excess bonus amount paid as a result of such materially misstated or inaccurate audit, review or compilation (an “Excess Bonus Amount”). Executive shall remit the Excess Bonus Amount to the Company within 30 days after receiving written notice (an “Excess Bonus Notice”) from the Board describing the reason for overpayment and the Excess Bonus Amount due from Executive. Notwithstanding the foregoing, if an Excess Bonus Notice is first given at any time after the second anniversary of the date on which the corresponding Excess Bonus Amount was paid to Executive by the Company, and the determination of such Excess Bonus Amount does not, in any respect, relate to, or arise from, any acts or omissions in financial reporting or accounting practices that occurred at the direction, or with the knowledge, of Executive, then the Company’s right to recover such Excess Bonus Amount thereafter shall only be accomplished through the exercise of its right of offset in Section 6.8 (and subject to the limitations therein).

2.3          Reimbursement of Expenses.  The Company shall reimburse Executive for all reasonable expenses incurred by Executive while performing Executive’s duties under this Agreement, subject to the Company’s policies in effect from time to time and corroborating documentation reasonably satisfactory to the Company.

2.4          Health Care and Benefit Plans.   During the Employment Term, Executive shall be eligible to receive all fringe benefits and perquisites and entitled to participate in all incentive, savings and retirement plans, practices, policies and programs applicable generally to other senior-level executives of the Company and shall be eligible for participation in, and shall receive all benefits under, any health or welfare benefit plans, practices, policies and programs provided by the Company normally available to other senior-level executives of the Company (subject to all applicable eligibility and contribution policies and rules), as may be in effect from time to time, including such insurance programs as may be implemented by the Company (“Benefit Plans”).

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2.5          Key Man Insurance.   Executive shall make application for, and submit to such examinations as may reasonably be requested by the Board in order to obtain key man or other insurance on the life of Executive for the benefit of the Company as the Board shall direct, the cost of which insurance shall be borne by the Company.

2.6          Vacation.   Executive shall receive four (4) weeks of paid vacation days per calendar year, to accrue pro rata on a monthly basis and to be administered in accordance with the Company’s policies and procedures (provided, however, that such policies shall not enhance Executive’s number of vacation days or otherwise conflict with this Section 2.6). Such vacation may be taken, in Executive’s discretion, subject to the reasonable business needs of the Company. Vacation time may not be carried over from one calendar year to the next, but rather must be used in the calendar year in which it is earned.

2.7          Awards Pursuant Parent’s Equity Incentive Plan.   Executive and the Company acknowledge that on the Commencement Date, Parent shall grant Executive options to acquire the number of Common Units equal to two percent (2%) of the fully-diluted equity of Parent pursuant to the terms and subject to the conditions set forth in the Blue Eagle Equity Incentive Plan (the “Incentive Plan”) and Award Agreement thereunder (“Award Agreement,” together with the Incentive Plan, the “Plan Documents”).

2.8          Amended and Restated Limited Partnership Agreement.   All Preferred Units in Parent acquired pursuant to that certain Subscription Agreement, dated as of the date hereof, between Parent and Executive (the “Subscription Agreement”), and any other equity of Parent acquired by Executive pursuant to the Plan Documents shall be subject to the terms and conditions of the Amended and Restated Limited Partnership Agreement of Parent (the “Partnership Agreement”, collectively with the Plan Documents, the “Equity Documents”).

ARTICLE III
TERMINATION OF EMPLOYMENT

3.1          Employment At Will.   Executive’s employment by the Company is at-will, and either Executive or the Company may terminate Executive’s employment with the Company (the effective date of separation being the “Termination Date”), subject to the following:

(a)          The Company may terminate Executive’s employment at any time with Cause by giving written notice of such termination to Executive designating an immediate or future termination date.

(b)          Executive may terminate Executive’s employment for Good Reason or without Good Reason by giving the Company thirty (30) days prior written notice of termination. Upon such notice, the Company may, at its option, (i) make Executive’s termination effective immediately, (ii) require Executive to continue to perform Executive’s duties hereunder during such 30-day period, with or without restrictions on Executive’s activities, and/or (iii) accept Executive’s notice of termination as Executive’s resignation from the Company at any time during such 30-day period on behalf of the Company. If the Company elects (i) above, the Company shall have no obligation to provide Executive any compensation or benefits beyond the Termination Date except for payment of Executive’s Base Salary under Section 2.1 and benefits under Section 2.4 that have accrued through the Termination Date, any severance payments or benefits under Section 3.2, or as otherwise required by law. If the Company elects (ii) or (iii) above, the Company shall pay Executive’s Base Salary under Section 2.1 and benefits under Section 2.4 through the date on which Executive voluntarily ceases to perform services for the Company, in addition to payment of any severance payments or benefits to Executive under Section 3.2.

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(c)          Executive’s employment will terminate immediately without any notice upon Executive’s death. If the Company determines in good faith that Executive is Disabled or Incapacitated during the Employment Term (pursuant to the definition of Disabled or Incapacitated set forth below), the Company may give Executive written notice in accordance with Section 3(d) of its intention to terminate Executive’s employment. In such event, Executive’s employment with the Company shall terminate effective on the 30^th day after receipt of such notice by Executive (the “Disability Effective Date”); provided that within the 30-day period after such receipt, Executive shall not have returned to full time performance of Executive’s duties. For purposes of this Agreement, “Disabled or Incapacitated” means Executive’s inability or failure, due to a medically determinable physical or mental impairment, to substantially perform the essential functions of Executive’s job, with or without a reasonable accommodation, for thirty (30) consecutive calendar days or for ninety (90) calendar days during any twelve (12)-month period irrespective of whether such days are consecutive. Whether Executive is “Disabled or Incapacitated” shall be determined by a physician selected by the Company or its insurers, which physician is reasonably acceptable to Executive. Upon request, Executive shall provide the Board with documentation from Executive’s health care provider sufficient for the Board to determine the nature and extent of any physical or mental impairment that may interfere with Executive’s performance of Executive’s job duties, as well as any accommodations that could be made. If Executive’s employment is terminated pursuant to this Section 3.1(c), the Company shall have no obligation to provide Executive any compensation or benefits beyond the Termination Date except for payment of Executive’s Base Salary under Section 2.1 and benefits under Section 2.4 that have accrued through the Termination Date or as otherwise required by law.

(d)          Any termination by the Company for Cause or without Cause, or by Executive for Good Reason or without Good Reason, shall be communicated by Notice of Termination to the other party hereto given in accordance with Section 6.1 of this Agreement. For purposes of this Agreement, a “Notice of Termination” means a written notice which (i) indicates the specific termination provision in this Agreement relied upon, (ii) to the extent applicable, sets forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of Executive’s employment under the provision so indicated and (iii) if the Termination Date is other than the date of receipt of such notice, specifies the termination date. The failure by Executive or the Company to set forth in the Notice of Termination any fact or circumstance which contributes to a showing of Good Reason or Cause shall not waive any right of Executive or the Company hereunder or preclude Executive or Company from asserting such fact or circumstance in enforcing Executive’s or Company’s rights hereunder.

(e)          The “Termination Date” means (i) if Executive’s employment is terminated by Company for Cause or by Executive for Good Reason, the date of receipt of the Notice of Termination or any later date specified therein pursuant to Section 3(d), or as provided in Section 3.1(b), as the case may be, (ii) if Executive’s employment is terminated by the Company without Cause or by Executive without Good Reason, the effective date of separation, (iii) if Executive’s employment is terminated by reason of Disability, the Disability Effective Date, and (iv) if Executive’s employment is terminated by reason of death, the date of death.

3.2          Company Obligations Upon Termination.

(a)          If the Company terminates Executive’s employment without Cause or Executive terminates his employment for Good Reason, then the Company will provide Executive with the following severance payments and/or benefits:

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(i)          Prior to the thirtieth day following the Termination Date, the Company shall pay to Executive in a lump sum, to the extent not previously paid, (x) the Base Salary through the Termination Date and (y) the Annual Bonus earned for any Fiscal Year ended prior to the year in which the Termination Date occurs, provided that Executive was employed on the last day of such Fiscal Year (the “Accrued Obligations”);

(ii)         Starting as of the next applicable Company payroll date after the Termination Date (provided Executive has complied with Section 3.2(b)), the Company will pay Executive a monthly amount equal to the (x) Base Salary, divided by (y) 12 (the “Cash Severance”), until the end of the ninth (9^th) month following the Termination Date (the “Severance Period”); and

(iii)        During the Severance Period, the Company shall continue the health and welfare benefits to Executive and, where applicable, Executive’s dependents on the same terms that would have been provided to them had Executive continued employment with Company in accordance with the health and welfare benefits provided pursuant to Section 2.4.

(b)          The obligations of the Company to make payments under Section 3.2(a) (other than the Accrued Obligations) are conditioned on Executive executing and delivering a general release of claims against the Company, its Affiliates, and each of their respective officers, directors, members, managers, partners and shareholders with respect to Executive’s employment, in substantially the form attached hereto as Exhibit B (the “Release”). If (i) the Board reasonably and in good faith believes that Executive has breached in any material respect any of Executive’s obligations in Article IV or (ii) Executive’s agrees to become employed by or to provide services to any entity that is an Affiliate of Sterling Fund Management, LLC, then the Board may unilaterally suspend Executive’s right to receive any Cash Severance then or thereafter due from Company to Executive, provided that in the case of clause (i), the Board (A) gives Executive advance written notice of such suspension and (B) initiates an action or claim to enforce Company’s rights in respect of such restrictive covenants promptly after such suspension. In the event that Company prevails on such action or claim, Executive’s right to receive, and Company’s obligation to pay, any additional Cash Severance, including any previously suspended amounts, shall be terminated immediately, and Executive shall have no further rights to Cash Severance. In the event that Executive prevails on such action or claim, Company shall be required to pay to Executive in a lump sum within thirty (30) days of such adjudication any Cash Severance the payment of which was delayed due to such suspension, plus interest for any period during which the payment of the Cash Severance was suspended at the prime rate, as published in the Wall Street Journal on the date of such suspension, and to commence payment of future installments of Cash Severance in accordance with Section 3.2(a)(ii) plus legal fees of Executive required in the defense.

(c)          For purposes of this Agreement:

(i)          The term “Affiliate” means, with respect to Parent: (A) any other entity or person owning 10% or more of the voting or beneficial interests of Parent; (B) the Company and any other entity or person directly or indirectly controlling, controlled by or under common control with Parent; or (C) any other entity in which more than 10% of the voting or beneficial interests are owned by one or more persons or entities who have a relationship with Parent described in clauses (A) or (B); provided that, for the purposes of this definition, “control” (including, with correlative meanings, the terms “controlled by” and “under common control with”), as used with respect to any person or entity, shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of such person or entity, whether through the ownership of voting securities, by contract or otherwise.

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(ii)         The term “Cause” means that Executive has: (A) engaged in (1) a material act of dishonesty involving the Company or its Affiliates, (2) malfeasance or gross negligence which is injurious to the Company, or (3) a material breach of his fiduciary duties related to employment; (B) committed an act of fraud or embezzlement, (C) committed any crime of moral turpitude or any felony; (D) repeatedly refused to perform specific reasonable directives from the Board or any officer of the Company to whom Executive reports that are reasonably consistent with the scope and nature of Executive’s responsibilities (other than such failure resulting from his disability or incapacity); (E) used or been under the influence of illegal drugs at the workplace or while performing Company business, or refused to submit for a drug test upon the Company’s reasonable request; (F) breached any provision of Article IV in any material respect; (G) failed to obtain the Board’s consent prior to causing the Company or any of its subsidiaries to engage in any business with any family members, their Affiliates or any entities they work with after the Commencement Date; (H) caused, directed or permitted Parent, the Company or any of their subsidiaries to grant incentive equity to any person on terms and conditions not specifically approved by the Board or the Committee, or caused, directed or permitted the Company to pay bonuses or grant raises to employees or other service providers of the Company in amounts materially in excess of the ranges contemplated by the Company’s budget, as approved by the Board, or in contravention of the Committee’s charter; (I) willfully breached Executive’s other duties and obligations in Section 1.3 or any other written agreement between Executive and Parent or the Company in any material respect, or willfully took or failed to take any action in contravention of the Board charters in any material respect; or (J) willfully violated any conflict of interest policy of the Company or the Board in any material respect. A termination will not be for “Cause” pursuant to clauses (A)(3), (D), (G), (H), or (I), to the extent such conduct is curable, unless Company shall have notified Executive in writing describing such conduct and prescribing conduct required to cure such conduct and Executive shall have failed to cure such conduct within ten (10) business days after his receipt of such written notice. For purposes of this definition of Cause, no act or failure to act on the part of Executive shall be considered willful if it is done, or omitted to be done, by Executive in good faith and with a good faith belief that Executive’s act or omission was in the best interests of Company or the Parent. Subject to the foregoing, (x) the decision to terminate Executive’s employment for Cause, to take other action or to take no action in response to any occurrence shall be in the sole and exclusive discretion of the Board, and (y) Executive’s employment by the Company also shall be deemed terminated for Cause if Executive resigns from the Company and the Board determines in good faith that one or more of the events described above existed as of the time of such resignation.

(iii)        “Good Reason” means a resignation by Executive occasioned by any of the following events or conditions: (1) a relocation of the principal place of performance of Executive’s duties to a location more than fifty (50) miles from the Company’s principal office in Atlanta, Georgia (unless such new principal place of performance is within fifty (50) miles from the Executive’s then-permanent residence); (2) a material reduction in Executive’s authority, duties or responsibilities (including reporting responsibilities) without Executive’s prior written consent; (3) a material reduction in Executive’s Base Salary, unless such reduction in base salary is based on a Company action affecting all executive employees of the Company and the percentage reduction of Executive’s base salary is no greater than that applied to any other executive employee of the Company; (4) a material breach of this Agreement by the Company that has a material adverse effect on Executive; or (5) a failure by the Company to pay Executive any material portion of the Base Salary, bonus or other benefits owed to Executive; provided, however, that in order for any event or condition described in clauses (1) through (5) above to constitute Good Reason hereunder, Executive must:

(A)         give the Company written notice within ten (10) days after Executive first has actual knowledge of the event or condition, which written notice identifies the event or condition and explains why Executive believes that it constitutes Good Reason; and

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(B)         (1) provide the Company twenty (20) days from the date of service of the notice described in sub-clause (A) above to cure such event or condition(to the extent such conduct is curable), and (2) terminate Executive’s employment only if such event or condition remains, to the reasonable satisfaction of Executive, uncured by the Company as of the end of such 20-day period.

ARTICLE IV
RESTRICTIVE COVENANTS

4.1          Definitions.   For purposes of this Article IV:

(a)          the term “Business” means (i) the business of providing fulfillment services, order processing, call centers, customer care services, including e-commerce fulfillment or e-commerce return services, related software platform and application services and similar and related services that the Company or any of its subsidiaries are engaged in during the Employment Term and (ii) any other business that the Company or any of its subsidiaries has taken affirmative steps towards engaging in on or prior to the Termination Date;

(b)          the term “Confidential Information” shall mean any non-public information, in whatever form or medium, concerning the operations or affairs of the Business, including, but not limited to, (i) sales, sales volume, sales methods, sales proposals, business plans, advertising and marketing plans, strategic and long-range plans, and any information related to any of the foregoing, (ii) customers, customer lists, prospective customers and customer records, (iii) general price lists and prices charged to specific customers, (iv) trade secrets, (v) financial statements, budgets and projections, (vi) software owned or developed (or being developed) for use in or relating to the conduct of the Business, (vii) the names, addresses and other contact information of all vendors and suppliers and prospective vendors and suppliers of the Business, and (viii) all other confidential or proprietary information belonging to the Company or relating to the Business; provided, however, that Confidential Information shall not include (1) knowledge, data and information that is generally known or becomes known in the trade or industry of the Company (other than as a result of a breach of this Agreement or other agreement or instrument to which Executive is bound), and (2) knowledge, data and information gained without a breach of this Agreement on a non-confidential basis from a person who is not legally prohibited from transmitting the information to Executive;

(c)          the term “Company” shall be deemed to include Parent, the Company and all of their subsidiaries;

(d)          the term “Non-Compete Restricted Period” shall mean the period commencing on the Commencement Date and terminating twelve (12) months following the termination of Executive’s employment or engagement with the Company;

(e)           the term “Non-Solicit Restricted Period” shall mean the period commencing on the Commencement Date and terminating twenty-four (24) months following the termination of Executive’s employment or engagement with the Company; and

(f)           the term “Prior Inventions” shall mean all inventions, original works of authorship, developments and improvements which were made by Executive, alone or jointly with others, prior to Executive’s employment, association or other engagement with the Company. To preclude any possibility of uncertainty, Executive has set forth on Exhibit B attached hereto a complete list of all Prior Inventions which Executive considers to be Executive’s property or the property of third parties and which Executive wishes to have excluded from the scope of this Agreement. If disclosure of any such Prior Invention on Exhibit B would cause Executive to violate any prior confidentiality agreement, Executive understands that Executive is not to list such Prior Invention in Exhibit B but is to inform the Company that all Prior Inventions have not been listed for that reason.

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4.2          Executive Acknowledgement.   Executive agrees and acknowledges that, to ensure that the Company retains its value and goodwill, Executive must not use any Confidential Information, special knowledge of the Business, or the Company’s relationships with its customers and employees, all of which Executive will continue to gain access to through Executive’s employment with the Company, other than in furtherance of Executive’s legitimate job duties. Executive further acknowledges that:

(a)          the Company is currently engaged in the Business;

(b)          the Business is highly competitive and the services to be performed by Executive for the Company are unique and national in nature;

(c)          Executive will continue to occupy a position of trust and confidence with the Company and has acquired and will acquire an intimate knowledge of Confidential Information and the Company’s relationships with its customers and employees;

(d)          the agreements and covenants contained in this Article IV are essential to protect the Company, the Confidential Information and the goodwill of the Company and are being entered into in consideration for the various rights being granted to Executive under this Agreement;

(e)          the Company would be irreparably damaged if Executive were to disclose the Confidential Information or provide services to any person or entity in violation of the provisions of this Agreement;

(f)           the scope and duration of the covenants set forth in this Article IV are reasonably designed to protect a protectable interest of the Company and are not excessive in light of the circumstances; and

(g)          Executive has the means to support himself and Executive’s dependents other than by engaging in activities prohibited by this Article IV.

4.3          Confidential Information.

(a)          At all times both during Executive’s employment and following the termination of Executive’s employment for any reason, Executive shall: (i) hold the Confidential Information in strictest confidence, take all reasonable precautions to prevent the inadvertent disclosure of the Confidential Information to any unauthorized person, and follow all the Company’s policies protecting the Confidential Information; (ii) not use, copy, divulge or otherwise disseminate or disclose any Confidential Information, or any portion thereof, to any unauthorized person; (iii) not make, or permit or cause to be made, copies of the Confidential Information, except as necessary to carry out Executive’s authorized duties as an employee of the Company; and (iv) promptly and fully advise the Company of all facts known to Executive concerning any actual or threatened unauthorized use or disclosure of which Executive becomes aware.

(b)          Executive hereby assigns to the Company any rights Executive may have or acquire in the Confidential Information, and recognizes that the Company shall be the sole owner of all copyrights, trade secret rights, and all other rights throughout the world (collectively, “Proprietary Rights”) in connection with such rights.

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(c)          If Executive receives any subpoena or becomes subject to any legal obligation that might require Executive to disclose Confidential Information, Executive will provide prompt written notice of that fact to the Company, enclosing a copy of the subpoena and any other documents describing the legal obligation. In the event that the Company objects to the disclosure of Confidential Information, by way of a motion to quash or otherwise, Executive agrees to not disclose any Confidential Information while any such objection is pending.

(d)          Executive understands that the Company has and will receive from third parties confidential or proprietary information (“Third Party Information”) under a duty to maintain the confidentiality of such Third Party Information and to use it only for limited purposes. During the term of Executive’s association with the Company and at all times after the termination of such association for any reason, Executive will hold Third Party Information in strict confidence and will not disclose or use any Third Party Information unless expressly authorized by the Company in advance or as may be strictly necessary to perform Executive’s obligations with the Company, subject to any agreements binding on the Company with respect to such Third Party Information.

(e)          Executive will not improperly use or disclose any confidential information or trade secrets, if any, of any former employer or of any other person to whom Executive has an obligation of confidentiality, and Executive will not bring onto the Company’s premises any unpublished documents or any property belonging to any former employer or of any other person to whom Executive has an obligation of confidentiality.

4.4          Ownership of Inventions.

(a)          Executive hereby agrees that any and all inventions (whether or not an application for protection has been filed under patent laws), works of authorship, information fixed in any tangible medium of expression (whether or not protected under copyright laws), Moral Rights, mask works, trademarks, trade names, trade dress, trade secrets, publicity rights, know-how, ideas (whether or not protected under trade secret laws), and all other subject matter protected under patent, copyright, Moral Right (defined as any right to claim authorship of a work, any right to object to any distortion or other modification of a work, and any similar right, existing under the law of any country, or under any treaty), mask work, trademark, trade secret, or other laws, that have been, are or will be developed, generated or produced by Executive, solely or jointly with others, at any time while employed by the Company, including during the Employment Term, are and shall be the exclusive property of the Company, subject to the obligations of this Article IV with respect to Confidential Information, and Executive hereby forever waives and agrees never to assert against the Company, its successors or licensees any and all ownership, interest, Moral Rights or similar rights with respect thereto. Executive hereby assigns to the Company all right, title and interest to the foregoing inventions, concepts, ideas and materials. This Section 4.4 does not apply to any invention or other work of Executive for which no equipment, supplies, facility or Confidential Information of the Company was used and that was developed entirely on Executive’s own time, unless the invention (A) relates to (x) the Business or (y) the Company’s actual or demonstrably anticipated research or development, or (B) results from any work performed by Executive for or on behalf of the Company. Executive shall keep and maintain adequate and current written records of all inventions, concepts, ideas and materials made by Executive (jointly or with others) during the term of Executive’s association or employment with the Company. Such records shall remain the property of the Company at all times. Executive shall promptly and fully disclose to the Company the nature and particulars of any Inventions or research project undertaken on the Company’s behalf.

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(b)          Unless the parties otherwise agree in writing, Executive is under no obligation to incorporate any Prior Inventions in any of Company’s products or processes or other Company Invention. If, in the course of Executive’s performance, Executive chooses to incorporate into any such Company product or process or other Company Invention any Prior Invention owned by Executive or in which Executive otherwise has an interest, Executive grants the Company a non-exclusive, royalty free, irrevocable, perpetual, world-wide license to copy, reproduce, make and have made, modify and create derivative works of, use, sell and license such Prior Inventions and derivative works as part of or in connection with any such Company product or process or other Company Invention.

(c)          During or subsequent to the Employment Term, Executive shall execute all papers, and otherwise provide assistance, at the Company’s reasonable request and expense, to enable the Company or its nominees to obtain and enforce all proprietary rights with respect to the Company Inventions (as defined below) in any and all countries. To that end, Executive will execute, verify and deliver such documents and perform such other acts (including appearances as a witness) as the Company may reasonably request for use in applying for, obtaining, perfecting, defending, evidencing and enforcing any such proprietary rights, and the assignment of any or all of such proprietary rights. In addition, Executive will execute, verify and deliver assignments of such rights to the Company or its designee. Executive’s obligation to assist the Company with respect to such rights shall continue beyond the termination of Executive’s association with the Company.

(d)          If, after reasonable effort, the Company cannot secure Executive’s signature on any document needed in connection with the actions specified in the preceding paragraph, Executive irrevocably designates and appoints the Company and its duly authorized officers and agents as Executive’s agent and attorney-in-fact, to act for and in Executive’s behalf to execute, verify and file any such documents and to do all other lawfully permitted acts to further the purposes of the preceding paragraph with the same legal force and effect as if executed by Executive. The power of attorney set forth in this Section 4.4 is coupled with an interest, is irrevocable, and shall survive Executive’s death, incompetence or incapacity and the termination of the Employment Term. Executive waives and quitclaims to the Company all claims of any nature whatsoever which Executive now has or may in the future obtain for infringement of any Proprietary Rights assigned under this Agreement or otherwise to the Company.

(e)          Executive acknowledges that all original works of authorship which are made by Executive (solely or jointly with others) during the course of the association with or performance of services for the Company and which are protectable by copyright are “works made for hire,” as that term is defined in the United States Copyright Act and any successor statutes. Inventions assigned to the Company or as directed by the Company under this Agreement or otherwise are referred to as “Company Inventions.”

4.5          Non-Solicitation.

(a)          During the Non-Solicit Restricted Period, Executive shall not (other than in furtherance of Executive’s legitimate job duties on behalf of Company), directly or indirectly, on Executive’s own behalf or for any other person or entity:

(i)          solicit for employment or hire, attempt to solicit for employment or hire, or employ or hire, any person who is or was employed by the Company at any time within six (6) months prior to the solicitation or hire (the “Restricted Personnel”);

(ii)         seek to influence any Restricted Personnel to leave the Company’s employment, engagement, or service; or

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(iii)        otherwise interfere with the relationship between any Restricted Personnel and the Company.

(b)          During the Non-Solicit Restricted Period, Executive shall not (other than in furtherance of Executive’s legitimate job duties on behalf of Company), directly or indirectly, on Executive’s own behalf or for any other person or entity:

(i)          solicit, entice or induce any customer that did business with the Company in the last two (2) years of Executive’s employment or any prospective customer of the Company (the “Restricted Customers”) to become a customer of any person or entity other than the Company with respect to products or services sold or under development by the Company as of Executive’s termination;

(ii)         sell, promote, or provide any product or services to a Restricted Customer if that product or service could otherwise be provided by the Company; or

(iii)        solicit, entice, induce, or assist any Restricted Customer to reduce or cease doing business with the Company or otherwise interfere with the relationship between any Restricted Customer and the Company.

4.6          Non-Competition; Investment Opportunities.

(a)          During the Non-Compete Restrictive Period, Executive shall not, directly or indirectly, alone or in combination with any other individual or entity, (i) own (other than through the passive ownership of less than one percent (1%) of the publicly traded shares of any entity), operate, manage, control, or participate in an executive, managerial, strategic, or sales role, in any individual or entity (other than the Company) that engages in or proposes to engage in the Business in the United States and any other country in which Executive worked for the Company (a “Competitive Business”); or (ii) otherwise render services to (as an employee, consultant, independent contractor or otherwise) a Competitive Business that are similar to the services Executive rendered to the Company, or that could involve the use of Confidential Information; and

(b)          During the Employment Term, if Executive learns of any investment opportunity in a business or any entity engaged in the Business, Executive shall present such investment opportunity to the Company.

4.7          If any court of competent jurisdiction shall deem any provision in this Article IV too restrictive, the other provisions shall stand, and the court shall modify the unduly restrictive provision to the point of greatest restriction permissible by law.

4.8          If this Agreement is terminated for any reason, Executive acknowledges and agrees that the restrictive covenants set forth in this Article IV (the “Restrictive Covenants”) shall survive the termination of this Agreement and Executive shall continue to be bound by the terms of this Article IV as if this Agreement was still in effect.

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4.9          The Company and Executive agree that damages will accrue to the Company by reason of Executive’s failure to observe any of the Restrictive Covenants. Therefore, if the Company shall institute any action or proceeding to enforce such provisions, Executive waives the claim or defense that there is an adequate remedy at law and agrees in any such action or proceeding not to (i) interpose the claim or defense that such remedy exists at law, or (ii) require the Company to show that monetary damages cannot be measured or to post any bond. Without limiting any other remedies that may be available to the Company, Executive hereby specifically affirms the appropriateness of injunctive or other equitable relief in any such action. Executive also acknowledges that the remedies afforded the Company pursuant to this Section 4.9 are not exclusive, nor shall they preclude the Company from seeking or receiving any other relief, including without limitation, any form of monetary or other equitable relief. Upon the reasonable request by the Company, Executive shall provide reasonable assurances and evidence of compliance with the Restrictive Covenants.

ARTICLE V
POST-TERMINATION OBLIGATIONS

5.1          Return of Company Materials.   No later than three (3) business days following the termination of Executive’s employment for any reason, Executive shall return to the Company, and shall not retain in any form or media of expression, all Company and Affiliate property that is then in Executive’s possession, custody or control, including, without limitation, all keys, access cards, credit cards, computer hardware and software, documents, records, policies, marketing information, design information, specifications and plans, data base information and lists, and any other property or information that Executive has or had relating to the Company or any Affiliate (whether those materials are in paper or computer-stored form), and including but not limited to any documents containing, summarizing, or describing any Confidential Information.

5.2          Executive Assistance.   During the Employment Term and for a reasonable period thereafter, Executive shall, upon reasonable notice, assist the Company and its subsidiaries (the “Affiliated Group”) in the defense of any claims, or potential claims that may be made or threatened to be made against any member of the Affiliated Group in any action, suit or proceeding, whether civil, criminal, administrative, investigative or otherwise (a “Proceeding”), and will assist the Affiliated Group in the prosecution of any claims that may be made by any member of the Affiliated Group in any Proceeding, to the extent that such claims may relate to Executive’s employment or the period of Executive’s employment by the Company. The Company shall reimburse Executive for all of the Executive’s reasonable out-of-pocket expenses associated with such assistance, including travel expenses and any attorneys’ fees and shall pay a reasonable per diem fee for the Executive’s service under this Section 5.2. Any services or assistance contemplated in this Section 5.2 shall be at mutually agreed to and convenient times.

ARTICLE VI
MISCELLANEOUS

6.1          Notices.   Any notices, consents or other communications required or permitted to be sent or given hereunder shall be in writing and shall be deemed properly served if (i) delivered personally, in which case the date of such notice shall be the date of delivery; (ii) delivered to a nationally recognized overnight courier service, in which case the date of delivery shall be the next business day; or (iii) sent by facsimile transmission (with a copy sent by first-class mail), in which case the date of delivery shall be the date of transmission, or if after 5:00 P.M., the next business day. If not personally delivered, notice shall be sent addressed as follows: (x) if to Executive, to the address listed on the signature page hereof, and (y) if to the Company, at c/o Sterling Partners, 401 North Michigan Avenue, Suite 3300, Chicago, IL 60611, Attention: Office of General Counsel, Facsimile No. (312) 465-7100, or in either case at such other address as may hereafter be specified by notice given by either party to the other party. Executive shall promptly notify the Company of any change in his address set forth on the signature page.

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6.2          Successors and Assigns.   This Agreement shall be binding upon, and inure to the benefit of, and be enforceable by, the parties hereto and the Company’s successors and permitted assigns. In the case of the Company, the successors and permitted assigns hereunder shall include without limitation any Affiliate as well as the successors in interest to the Company or any such Affiliate (whether by merger, liquidation (including successive mergers or liquidations) or otherwise). This Agreement or any right or interest hereunder is one of personal service and may not be assigned by Executive under any circumstance. Nothing in this Agreement, whether expressed or implied, is intended or shall be construed to confer upon any person other than the parties and successors and assigns permitted by this Section 6.2 any right, remedy or claim under or by reason of this Agreement.

6.3          Entire Agreement; Amendments.   This Agreement, the Exhibits hereto, the Equity Documents and the Subscription Agreement embody the complete agreement and understanding of the parties hereto with regard to the subject matter hereof and supersede and preempt any prior agreements, understandings, letters of intent, or representations by or among the parties, written or oral, which may have related to the subject matter hereof. This Agreement shall not be amended, modified or supplemented except by a written instrument signed by each of the parties hereto.

6.4          Interpretation.   Article titles and section headings contained herein are inserted for convenience of reference only and are not intended to be a part of or to affect the meaning or interpretation of this Agreement.

6.5          Waivers.   No provision of this Agreement may be waived except in a writing executed and delivered by the party against whom waiver is sought. Any such written waiver shall be effective only with respect to the event or circumstance described therein and not with respect to any other event or circumstance, unless such waiver expressly provides to the contrary.

6.6          Partial Invalidity.   Wherever possible, each term and provision of this Agreement shall be interpreted so as to be effective and valid under applicable law. If any term or provision shall be held invalid or unenforceable, the remaining terms and provisions hereof not be affected thereby, unless such a construction would be unreasonable. Executive’s obligations in Articles IV and V shall survive and continue in full force notwithstanding the termination of this Agreement or Executive’s employment for any reason.

6.7          Tax Matters.   Executive acknowledges that no representative or agent of Parent or the Company has provided Executive with any tax advice of any nature, and Executive has had the opportunity to consult with his own legal, tax and financial advisor(s) as to tax and related matters concerning the compensation to be received under this Agreement.

6.8          Offset.   To the extent permitted by law, and to the extent that such action will not result in the imposition of additional taxes, interest or penalties pursuant to Section 409A (as defined below), the Company may offset any amounts Executive owes it pursuant to this Agreement or any other written agreement, note or other instrument relating to indebtedness for borrowed money to which Executive is a party or pursuant to any other liability or obligation by which Executive is bound against any amounts it owes Executive hereunder.

6.9          Execution in Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be considered an original instrument, but all of which shall be considered one and the same agreement.

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6.10        Required Delay for Deferred Compensation Under 409A.   Notwithstanding any other provision of this Agreement, if at the time of separation from service Executive is determined by the Company to be a “specified employee” (as defined in Section 409A of the Code (together, with any state law of similar effect, “Section 409A”) and Section 1.409A-1(i) of the Treasury Regulations), and the Company determines that delayed commencement of any portion of the termination payments and benefits payable to Executive pursuant to this Agreement is required in order to avoid a prohibited distribution under Section 409A(a)(2)(B)(i) of the Internal Revenue Code of 1986 (as amended, the “Code”), then such portion of Executive’s termination payments and benefits shall not be provided to Executive prior to the earliest of (1) the date that is six months and one day after Executive’s separation from service, (2) the date of Executive’s death or (3) such earlier date as is permitted under Section 409A (any such delayed commencement, a “Payment Delay”). Upon the expiration of such Payment Delay, all payments deferred pursuant to a Payment Delay shall be paid in a lump sum to Executive on the first day following the expiration of the Payment Delay, and any remaining payments due under the Agreement shall be paid on the original schedule provided herein.

This Agreement is intended to meet the requirements of Section 409A, and shall be interpreted and construed consistent with that intent. References to termination of employment, retirement, separation from service and similar or correlative terms in this Agreement shall mean a “separation from service” (as defined at Section 1.409A-1(h) of the Treasury Regulations) from the Company and from all other corporations and trades or businesses, if any, that would be treated as a single “service recipient” with the Company under Section 1.409A-1(h)(3) of the Treasury Regulations. Each installment of the payments and benefits provided for in this Agreement shall be treated as a separate “payment” for purposes of Treasury Regulation Section 1.409A-2(b)(2)(i).

6.11        Governing Law; Consent to Jurisdiction; Waiver of Jury.   This Agreement shall be governed by and construed in accordance with the internal laws of the State of Georgia, without regard to its conflict of law principles. For the purposes of any suit, action, or other proceeding arising out of this Agreement or with respect to Executive’s employment hereunder, the Parties hereto: (i) agree to submit to the exclusive jurisdiction of the federal or state courts located in Fulton County, State of Georgia, (ii) agree to unconditionally waive any objection to venue in such jurisdiction, and agree not to plead or claim forum non conveniens, and (iii) to waive their respective rights to a jury trial of any and such claims and causes of action.

6.12        Construction.   The language used in this Agreement will be deemed to be the language chosen by Executive and the Company to express their mutual intent, and no rule of strict construction will be applied against Executive or the Company.

6.13        280G Waiver.  Executive has been granted several restricted stock awards from the Company, including a grant during 2013 (the “2013 Restricted Stock Award”). Under the terms of these awards and the Merger Agreement, the shares of restricted stock would become fully vested and nonforfeitable in connection with the consummation of the transactions contemplated by the Merger Agreement. Executive hereby irrevocably agrees to the cancellation and forfeiture, immediately prior to the time that the shares would become vested, of a number of shares of the Company’s stock held by him pursuant to the 2013 Restricted Stock Award equal to the smallest number of whole shares that can be cancelled to avoid Executive receiving any payments (including the acceleration of vesting of the restricted stock awards and any other payments or benefits that are contingent on (within the meaning of Section 280G of the Code) the Offer or the Merger, but expressly excluding any severance payments that could become payable under this Agreement) that would be treated as “Parachute Payments” as defined in Code Section 280G. In determining the shares to be cancelled, it shall be assumed that the Executive remains employed with the Company and is not entitled to any benefits under Article III of this Agreement, and the shares with the latest vesting date shall be cancelled first.

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6.14        280G Limitation. If, following the Merger, Executive becomes entitled to compensation and benefits under Article III of this Agreement, and if any payment or benefit to be paid or provided under this Agreement would be a “Parachute Payment,” within the meaning of Section 280G of the Code, or any successor provision thereto, but for the application of this sentence, then the payments and benefits to be paid or provided hereunder shall be reduced to the minimum extent necessary (but in no event to less than zero) so that no portion of any such payment or benefit, as so reduced, constitutes a Parachute Payment; provided, however, that the foregoing reduction shall not be made if the total of the unreduced aggregate payments and benefits to be provided to Executive, determined on an after-tax basis (taking into account the excise tax imposed pursuant to Section 4999 of the Code, or any successor provision thereto, any tax imposed by any comparable provision of state law, and any applicable federal, state and local income taxes), exceeds the total after-tax amount of such aggregate payments and benefits after application of the foregoing reduction. The determination of whether any reduction in such payments or benefits to be provided hereunder is required pursuant to the preceding sentence shall be made at the expense of the Company, if requested by Executive or the Company, by the Company’s independent accountants or an independent third-party selected by the Company. In the event that any payment or benefit intended to be provided hereunder is required to be reduced pursuant to this Section, then the reduction shall occur in the following order: (a) reduction of Cash Severance described in Section 3.2(a)(ii) (with such reduction being applied to the payments in the reverse order in which they would otherwise be made, that is, later payments shall be reduced before earlier payments); and (b) subsidy of health and welfare benefits under Section 3.2(a)(iii) above.

*       *       *

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IN WITNESS WHEREOF, the Company has caused this Amended and Restated Employment Agreement to be duly executed by an officer thereunto duly authorized, and Executive has hereunto set his hand, all as of the day and year first above written.

THE COMPANY:

INNOTRAC CORPORATION

By:	/s/ Scott Dorfman
Name:  Scott Dorfman
Title:    Chief Executive Officer

EXECUTIVE:

/s/ Robert J. Toner, Jr.

Name: Robert J. Toner, Jr.

Address:	[REDACTED]
	[REDACTED]
Phone:	[REDACTED]
Fax:

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Exhibit A

Form of Release

THIS RELEASE (the “Release”) is entered into between Robert Toner (“Executive”) and Innotrac Corporation, a Georgia corporation (the “Company”), for the benefit of the Company. The entering into and non-revocation of this Release is a condition to Executive’s right to receive the payments under Section 3.2 of the Amended and Restated Employment Agreement entered into by and between Executive and the Company, dated as of November 14, 2013 (the “Employment Agreement”). Capitalized terms used and not defined herein shall have the meaning provided in the Employment Agreement.

Accordingly, Executive and the Company agree as follows.

1.           In consideration for the payments and other benefits provided to Executive under Section 3.2(a) of the Employment Agreement, Executive represents and agrees, as follows:

(a)          Executive, for himself, his heirs, administrators, representatives, executors, successors and assigns (collectively “Releasers”), hereby irrevocably and unconditionally releases, acquits and forever discharges and agrees not to sue the Company or any of its parents, subsidiaries, divisions, affiliates and related entities and its current and former directors, officers, shareholders, trustees, employees, consultants, independent contractors, representatives, agents, servants, successors and assigns and all persons acting by, through or under or in concert with any of them (collectively “Releasees”), from all claims, rights and liabilities up to and including the date of this Release arising from or relating to Executive’s employment with, or termination of employment from, the Company, under the Employment Agreement and from any and all charges, complaints, claims, liabilities, obligations, promises, agreements, controversies, damages, actions, causes of actions, suits, rights, demands, costs, losses, debts and expenses of any nature whatsoever, known or unknown, suspected or unsuspected and any claims of wrongful discharge, breach of contract, implied contract, promissory estoppel, defamation, slander, libel, tortious conduct, employment discrimination or claims under any federal, state or local employment statute, law, order or ordinance, including any rights or claims arising under Title VII of the Civil Rights Act of 1964, as amended, the Age Discrimination in Employment Act of 1967, as amended, 29 U.S.C. § 621 et seq. (“ADEA”), or any other federal, state or municipal ordinance relating to discrimination in employment. Nothing contained herein shall restrict the parties’ rights to enforce the terms of this Release.

(b)          To the maximum extent permitted by law, Executive agrees that he has not filed, nor will he ever file, a lawsuit asserting any claims which are released by this Release.

(c)          This Release specifically excludes Executive’s rights and the Company’s obligations under Sections 3.2 and 6.14 of the Employment Agreement, the Benefit Plans, and the Equity Documents. Executive’s entitlement to vested benefits under the Benefit Plans and the Equity Documents shall be determined in accordance with the provisions of the Benefit Plans or Equity Documents, as the case may be. Nothing contained in this Release shall release Executive from his obligations, including any obligations to abide by restrictive covenants, under the Employment Agreement, the Equity Documents or the Benefit Plans that continue or are to be performed following termination of employment.

(d)          The parties agree that this Release shall not affect the rights and responsibilities of the US Equal Employment Opportunity Commission (hereinafter “EEOC”) to enforce ADEA and other laws. In addition, the parties agree that this Release shall not be used to justify interfering with Executive’s protected right to file a charge or participate in an investigation or proceeding conducted by the EEOC. The parties further agree that Executive knowingly and voluntarily waives all rights or claims (that arose prior to Executive’s execution of this Release) the Releasers may have against the Releasees, or any of them, to receive any benefit or remedial relief (including, but not limited to, reinstatement, back pay, front pay, damages, attorneys’ fees, experts’ fees) as a consequence of any investigation or proceeding conducted by the EEOC.

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2.           Executive acknowledges that the Company has specifically advised him of the right to seek the advice of an attorney concerning the terms and conditions of this Release. Executive further acknowledges that he has been furnished with a copy of this Release, and he has been afforded twenty-one (21) days in which to consider the terms and conditions set forth above prior to this Release. By executing this Release, Executive affirmatively states that he has had sufficient and reasonable time to review this Release and to consult with an attorney concerning his legal rights prior to the final execution of this Release. Executive further agrees that he has carefully read this Release and fully understands its terms. Executive understands that he may revoke this Release within seven (7) days after signing this Release. Revocation of this Release must be made in writing and must be received by [●] at [●] within the time period set forth above.

3.           This Release will be governed by and construed in accordance with the laws of the state of Georgia, without giving effect to any choice of law or conflicting provision or rule (whether of the state of Georgia or any other jurisdiction) that would cause the laws of any jurisdiction other than the state of Georgia to be applied. In furtherance of the foregoing, the internal law of the state of Georgia will control the interpretation and construction of this agreement, even if under such jurisdiction’s choice of law or conflict of law analysis, the substantive law of some other jurisdiction would ordinarily apply. The provisions of this Release are severable, and if any part or portion of it is found to be unenforceable, the other paragraphs shall remain fully valid and enforceable. This Release shall become effective and enforceable on the eighth day following its execution by Executive, provided he does not exercise his right of revocation as described above. If Executive fails to sign and deliver this Release or revokes his signature, this Release will be without force or effect, and Executive shall not be entitled to the payment under Section 3.2 of the Employment Agreement.

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Exhibit B

Prior Inventions

None.

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EX-10.6

Exhibit 10.6

AMENDED AND RESTATED
EMPLOYMENT AGREEMENT

This AMENDED AND RESTATED EMPLOYMENT AGREEMENT (the “Agreement”) is made as of November 14, 2013 (but effective as of the Commencement Date, as defined below), by and between Innotrac Corporation, a Georgia corporation (the “Company”), and Larry Hanger (“Executive”).

RECITALS

A.          The Company and Executive are party to that certain Employment Agreement, dated as of April 5, 2010 (the “Existing Employment Agreement”).

B.           Immediately following the execution and delivery of this Agreement, the Company, Blue Eagle Holdings, L.P., a Delaware limited partnership (“Parent”), and Blue Eagle Acquisition Sub, Inc., a Georgia corporation and wholly owned subsidiary of Parent (“Purchaser”), will enter into that certain Agreement and Plan of Merger, dated as of the date hereof (the “Merger Agreement”).

C.           On the terms and subject to the conditions set forth in the Merger Agreement, (i) Purchaser will commence a tender offer to purchase (the “Offer”) all of the issued and outstanding shares of common stock of the Company, par value $0.10 per share (the “Common Stock”), at an offer price equal to the Offer Price (as defined in the Merger Agreement) payable to the seller in cash, without interest, subject to withholding of taxes required by applicable Law and (ii) following the consummation of the Offer and at the Effective Time (as defined in the Merger Agreement), Purchaser will merge with and into the Company (the “Merger”), with the Company continuing as the surviving corporation, whereby each issued and outstanding share of Common Stock (other than Excluded Shares (as defined in the Merger Agreement)) will be converted into the right to receive the Common Merger Consideration (as defined in the Merger Agreement) payable to the seller in cash, without interest, subject to withholding of taxes required by applicable Law.

D.           Simultaneous with the execution and delivery of this Agreement, the Company is entering into employment agreements (the “Other Employment Agreements”) with certain other executives of the Company (the “Other Executives”).

E.           As a condition and inducement to Parent and Purchaser entering into and incurring their respective obligations under the Merger Agreement, Executive and the Company have agreed to amend and restate the Existing Employment Agreement on the terms set forth herein.

NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth below, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Company and Executive agree as follows:

ARTICLE I
EMPLOYMENT SERVICES

1.1         Term of Employment.  Executive’s employment under this Agreement shall commence and be effective at the Effective Time (the “Commencement Date”) and continue until terminated pursuant to Article III below (the “Employment Term”). This Agreement shall terminate automatically and will be of no force or effect upon any termination of the Merger Agreement in accordance with its terms prior to the occurrence of the Effective Time.

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1.2          Title and Position.  During the Employment Term, Executive shall hold the position of Senior Vice President of Client Services the Company, and shall report directly to the Chief Executive Officer of the Company. Executive’s responsibilities shall include such duties as are commensurate with Executive’s position and as may be assigned to Executive in good faith by the Board of Directors of the Company (the “Board”) or the Chief Executive Officer.

1.3          Activities and Duties During Employment.

(a)          Executive shall conduct himself, both professionally and personally, with due regard to public conventions and morals, and in a manner that will not have a materially adverse effect on the reputation of the Company or Executive. Executive shall devote Executive’s full business time, attention, skill and energy to the business and affairs of the Company and its subsidiaries, and shall use Executive’s reasonable best efforts to faithfully perform Executive’s responsibilities in a diligent, trustworthy, efficient and businesslike manner so as to advance the best interests of the Company. Notwithstanding the foregoing, Executive shall be permitted to devote a reasonable amount of time and effort to (i) serving on governing boards of or otherwise assisting civic and charitable organizations, and (ii) investing and managing personal and family investments, but only to the extent that activities described in clauses (i) or (ii), individually or as a whole, do not (A) involve Executive’s active participation in the management of any corporation, partnership or other business entity, (B) involve an ownership interest in any customer or vendor of the Company unless approved in advance by written resolution of the Board, (C) interfere with the Executive’s duties to the Company in any material respect, or (D) otherwise violate any provision of this Agreement in any material respect. Executive shall not have any ownership interest in any customer or vendor of Parent the Company or any of their subsidiaries unless approved in advance by written resolution of the Board.

(b)          Executive shall comply in all material respects with all applicable laws, and all written policies, rules and regulations of the Company, including without limitation codes of conduct and any charter of the Board or any compensation committee of the Board (the “Committee”), as applicable.

ARTICLE II
COMPENSATION

2.1          Base Salary.   During the Employment Term, Executive shall receive an initial annual base salary of $236,950 (“Base Salary”), less applicable withholdings, payable in accordance with the general payroll practices of the Company(but no less infrequently than in equal monthly installments). The Base Salary will be reviewed by the Board or the Committee or its designee at least annually for increase (but not for decrease, except to the extent permitted under Section 3.2(c)(iii)(3)). As so adjusted, the Base Salary shall thereafter be Executive’s “Base Salary” for all purposes under this Agreement.

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2.2          Incentive Bonus.

(a)          The Company shall establish a performance-based bonus plan (the “Plan”) pursuant to which Executive shall be eligible to receive an annual incentive bonus (the “Annual Bonus”) with respect to each fiscal year of Company (“Fiscal Year”) ending during the Employment Term, subject to the achievement of financial performance objectives and “management by objective” goals as previously established by the Board in consultation with the Chief Executive Officer, which objectives shall be reasonably related to the Company’s business objectives. The Board or the Committee shall administer the Plan, and shall have the sole discretion to determine if the goals have been attained and what percentage of Base Salary, if any, will be paid as an Annual Bonus; provided any such determinations are made reasonably and in good faith. To the extent the goals are financial in nature, the Board shall base its determination on the audit, review or compilation of the Company’s financial results submitted by the Company’s independent accountants, which determination shall be made within thirty (30) days of receipt by the Company of such audit, review or compilation (the date on which the Committee makes such determination, the “Bonus Determination Date”). Executive acknowledges that (i) no Annual Bonus shall be earned or accrued until the corresponding Bonus Determination Date and (ii) in order to receive an Annual Bonus with respect to a Fiscal Year, Executive must remain continuously employed by the Company through and including the first day of the Fiscal Year following the Fiscal Year to which such Annual Bonus relates and provided that Executive’s employment with the Company is not terminated by the Company for Cause prior to the Bonus Determination Date. The Annual Bonus shall be paid as soon as practicable after the Bonus Determination Date, but in no event later than December 31 of the Fiscal Year following the Fiscal Year for which the Annual Bonus relates. With respect to the Company’s 2013 Fiscal Year, Executive will be entitled to a Bonus under the Company’s 2013 Executive Bonus Plan (the “2013 Bonus”), which shall be paid as soon as practicable after the thirtieth (30^th) day following receipt by the Board of the Company’s audit for the 2013 Fiscal Year, but in no event later than December 31, 2014. Executive acknowledges that (x) the 2013 Bonus shall not be earned or accrued until the thirtieth (30^th) day following receipt by the Board of the Company’s audit for the 2013 Fiscal Year (the “2013 Bonus Determination Date”) and (y) in order to receive the 2013 Bonus, Executive must remain continuously employed by the Company through and including the first day of the Fiscal Year following the 2013 Fiscal Year and provided that Executive’s employment with the Company is not terminated by the Company for Cause prior to the 2013 Bonus Determination Date.

(b)          Should the Board determine that an Annual Bonus to Executive was based on an audit, review or compilation that is later found to be materially misstated or inaccurate in any material respect, the Board shall have the right to require Executive to remit to the Company any excess bonus amount paid as a result of such materially misstated or inaccurate audit, review or compilation (an “Excess Bonus Amount”). Executive shall remit the Excess Bonus Amount to the Company within 30 days after receiving written notice (an “Excess Bonus Notice”) from the Board describing the reason for overpayment and the Excess Bonus Amount due from Executive. Notwithstanding the foregoing, if an Excess Bonus Notice is first given at any time after the second anniversary of the date on which the corresponding Excess Bonus Amount was paid to Executive by the Company, and the determination of such Excess Bonus Amount does not, in any respect, relate to, or arise from, any acts or omissions in financial reporting or accounting practices that occurred at the direction, or with the knowledge, of Executive, then the Company’s right to recover such Excess Bonus Amount thereafter shall only be accomplished through the exercise of its right of offset in Section 6.8 (and subject to the limitations therein).

2.3          Reimbursement of Expenses.  The Company shall reimburse Executive for all reasonable expenses incurred by Executive while performing Executive’s duties under this Agreement, subject to the Company’s policies in effect from time to time and corroborating documentation reasonably satisfactory to the Company.

2.4          Health Care and Benefit Plans.  During the Employment Term, Executive shall be eligible to receive all fringe benefits and perquisites and entitled to participate in all incentive, savings and retirement plans, practices, policies and programs applicable generally to other senior-level executives of the Company and shall be eligible for participation in, and shall receive all benefits under, any health or welfare benefit plans, practices, policies and programs provided by the Company normally available to other senior-level executives of the Company (subject to all applicable eligibility and contribution policies and rules), as may be in effect from time to time, including such insurance programs as may be implemented by the Company (“Benefit Plans”).

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2.5          Key Man Insurance.  Executive shall make application for, and submit to such examinations as may reasonably be requested by the Board in order to obtain key man or other insurance on the life of Executive for the benefit of the Company as the Board shall direct, the cost of which insurance shall be borne by the Company.

2.6          Vacation.  Executive shall receive four (4) weeks of paid vacation days per calendar year, to accrue pro rata on a monthly basis and to be administered in accordance with the Company’s policies and procedures (provided, however, that such policies shall not enhance Executive’s number of vacation days or otherwise conflict with this Section 2.6). Such vacation may be taken, in Executive’s discretion, subject to the reasonable business needs of the Company. Vacation time may not be carried over from one calendar year to the next, but rather must be used in the calendar year in which it is earned.

2.7          Awards Pursuant Parent’s Equity Incentive Plan.  Executive and the Company acknowledge that on the Commencement Date, Parent shall grant Executive options to acquire the number of Common Units equal to one and one-quarter percent (1.25%) of the fully-diluted equity of Parent pursuant to the terms and subject to the conditions set forth in the Blue Eagle Equity Incentive Plan (the “Incentive Plan”) and Award Agreement thereunder (“Award Agreement,” together with the Incentive Plan, the “Plan Documents”).

2.8          Amended and Restated Limited Partnership Agreement.  All Preferred Units in Parent acquired pursuant to that certain Subscription Agreement, dated as of the date hereof, between Parent and Executive (the “Subscription Agreement”), and any other equity of Parent acquired by Executive pursuant to the Plan Documents shall be subject to the terms and conditions of the Amended and Restated Limited Partnership Agreement of Parent (the “Partnership Agreement”, collectively with the Plan Documents, the “Equity Documents”).

ARTICLE III
TERMINATION OF EMPLOYMENT

3.1          Employment At Will.  Executive’s employment by the Company is at-will, and either Executive or the Company may terminate Executive’s employment with the Company (the effective date of separation being the “Termination Date”), subject to the following:

(a)          The Company may terminate Executive’s employment at any time with Cause by giving written notice of such termination to Executive designating an immediate or future termination date.

(b)          Executive may terminate Executive’s employment for Good Reason or without Good Reason by giving the Company thirty (30) days prior written notice of termination. Upon such notice, the Company may, at its option, (i) make Executive’s termination effective immediately, (ii) require Executive to continue to perform Executive’s duties hereunder during such 30-day period, with or without restrictions on Executive’s activities, and/or (iii) accept Executive’s notice of termination as Executive’s resignation from the Company at any time during such 30-day period on behalf of the Company. If the Company elects (i) above, the Company shall have no obligation to provide Executive any compensation or benefits beyond the Termination Date except for payment of Executive’s Base Salary under Section 2.1 and benefits under Section 2.4 that have accrued through the Termination Date, any severance payments or benefits under Section 3.2, or as otherwise required by law. If the Company elects (ii) or (iii) above, the Company shall pay Executive’s Base Salary under Section 2.1 and benefits under Section 2.4 through the date on which Executive voluntarily ceases to perform services for the Company, in addition to payment of any severance payments or benefits to Executive under Section 3.2.

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(c)          Executive’s employment will terminate immediately without any notice upon Executive’s death. If the Company determines in good faith that Executive is Disabled or Incapacitated during the Employment Term (pursuant to the definition of Disabled or Incapacitated set forth below), the Company may give Executive written notice in accordance with Section 3(d) of its intention to terminate Executive’s employment. In such event, Executive’s employment with the Company shall terminate effective on the 30^th day after receipt of such notice by Executive (the “Disability Effective Date”); provided that within the 30-day period after such receipt, Executive shall not have returned to full time performance of Executive’s duties. For purposes of this Agreement, “Disabled or Incapacitated” means Executive’s inability or failure, due to a medically determinable physical or mental impairment, to substantially perform the essential functions of Executive’s job, with or without a reasonable accommodation, for thirty (30) consecutive calendar days or for ninety (90) calendar days during any twelve (12)-month period irrespective of whether such days are consecutive. Whether Executive is “Disabled or Incapacitated” shall be determined by a physician selected by the Company or its insurers, which physician is reasonably acceptable to Executive. Upon request, Executive shall provide the Board with documentation from Executive’s health care provider sufficient for the Board to determine the nature and extent of any physical or mental impairment that may interfere with Executive’s performance of Executive’s job duties, as well as any accommodations that could be made. If Executive’s employment is terminated pursuant to this Section 3.1(c), the Company shall have no obligation to provide Executive any compensation or benefits beyond the Termination Date except for payment of Executive’s Base Salary under Section 2.1 and benefits under Section 2.4 that have accrued through the Termination Date or as otherwise required by law.

(d)          Any termination by the Company for Cause or without Cause, or by Executive for Good Reason or without Good Reason, shall be communicated by Notice of Termination to the other party hereto given in accordance with Section 6.1 of this Agreement. For purposes of this Agreement, a “Notice of Termination” means a written notice which (i) indicates the specific termination provision in this Agreement relied upon, (ii) to the extent applicable, sets forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of Executive’s employment under the provision so indicated and (iii) if the Termination Date is other than the date of receipt of such notice, specifies the termination date. The failure by Executive or the Company to set forth in the Notice of Termination any fact or circumstance which contributes to a showing of Good Reason or Cause shall not waive any right of Executive or the Company hereunder or preclude Executive or Company from asserting such fact or circumstance in enforcing Executive’s or Company’s rights hereunder.

(e)          The “Termination Date” means (i) if Executive’s employment is terminated by Company for Cause or by Executive for Good Reason, the date of receipt of the Notice of Termination or any later date specified therein pursuant to Section 3(d), or as provided in Section 3.1(b), as the case may be, (ii) if Executive’s employment is terminated by the Company without Cause or by Executive without Good Reason, the effective date of separation, (iii) if Executive’s employment is terminated by reason of Disability, the Disability Effective Date, and (iv) if Executive’s employment is terminated by reason of death, the date of death.

3.2          Company Obligations Upon Termination.

(a)          If the Company terminates Executive’s employment without Cause or Executive terminates his employment for Good Reason, then the Company will provide Executive with the following severance payments and/or benefits:

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(i)          Prior to the thirtieth day following the Termination Date, the Company shall pay to Executive in a lump sum, to the extent not previously paid, (x) the Base Salary through the Termination Date and (y) the Annual Bonus earned for any Fiscal Year ended prior to the year in which the Termination Date occurs, provided that Executive was employed on the last day of such Fiscal Year (the “Accrued Obligations”);

(ii)         Starting as of the next applicable Company payroll date after the Termination Date (provided Executive has complied with Section 3.2(b)), the Company will pay Executive a monthly amount equal to the (x) Base Salary, divided by (y) 12 (the “Cash Severance”), until the end of the ninth (9^th) month following the Termination Date (the “Severance Period”); and

(iii)        During the Severance Period, the Company shall continue the health and welfare benefits to Executive and, where applicable, Executive’s dependents on the same terms that would have been provided to them had Executive continued employment with Company in accordance with the health and welfare benefits provided pursuant to Section 2.4.

(b)          The obligations of the Company to make payments under Section 3.2(a) (other than the Accrued Obligations) are conditioned on Executive executing and delivering a general release of claims against the Company, its Affiliates, and each of their respective officers, directors, members, managers, partners and shareholders with respect to Executive’s employment, in substantially the form attached hereto as Exhibit B (the “Release”). If (i) the Board reasonably and in good faith believes that Executive has breached in any material respect any of Executive’s obligations in Article IV or (ii) Executive’s agrees to become employed by or to provide services to any entity that is an Affiliate of Sterling Fund Management, LLC, then the Board may unilaterally suspend Executive’s right to receive any Cash Severance then or thereafter due from Company to Executive, provided that in the case of clause (i), the Board (A) gives Executive advance written notice of such suspension and (B) initiates an action or claim to enforce Company’s rights in respect of such restrictive covenants promptly after such suspension. In the event that Company prevails on such action or claim, Executive’s right to receive, and Company’s obligation to pay, any additional Cash Severance, including any previously suspended amounts, shall be terminated immediately, and Executive shall have no further rights to Cash Severance. In the event that Executive prevails on such action or claim, Company shall be required to pay to Executive in a lump sum within thirty (30) days of such adjudication any Cash Severance the payment of which was delayed due to such suspension, plus interest for any period during which the payment of the Cash Severance was suspended at the prime rate, as published in the Wall Street Journal on the date of such suspension, and to commence payment of future installments of Cash Severance in accordance with Section 3.2(a)(ii) plus legal fees of Executive required in the defense.

(c)          For purposes of this Agreement:

(i)          The term “Affiliate” means, with respect to Parent: (A) any other entity or person owning 10% or more of the voting or beneficial interests of Parent; (B) the Company and any other entity or person directly or indirectly controlling, controlled by or under common control with Parent; or (C) any other entity in which more than 10% of the voting or beneficial interests are owned by one or more persons or entities who have a relationship with Parent described in clauses (A) or (B); provided that, for the purposes of this definition, “control” (including, with correlative meanings, the terms “controlled by” and “under common control with”), as used with respect to any person or entity, shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of such person or entity, whether through the ownership of voting securities, by contract or otherwise.

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(ii)         The term “Cause” means that Executive has: (A) engaged in (1) a material act of dishonesty involving the Company or its Affiliates, (2) malfeasance or gross negligence which is injurious to the Company, or (3) a material breach of his fiduciary duties related to employment; (B) committed an act of fraud or embezzlement, (C) committed any crime of moral turpitude or any felony; (D) repeatedly refused to perform specific reasonable directives from the Board or any officer of the Company to whom Executive reports that are reasonably consistent with the scope and nature of Executive’s responsibilities (other than such failure resulting from his disability or incapacity); (E) used or been under the influence of illegal drugs at the workplace or while performing Company business, or refused to submit for a drug test upon the Company’s reasonable request; (F) breached any provision of Article IV in any material respect; (G) failed to obtain the Board’s consent prior to causing the Company or any of its subsidiaries to engage in any business with any family members, their Affiliates or any entities they work with after the Commencement Date; (H) caused, directed or permitted Parent, the Company or any of their subsidiaries to grant incentive equity to any person on terms and conditions not specifically approved by the Board or the Committee, or caused, directed or permitted the Company to pay bonuses or grant raises to employees or other service providers of the Company in amounts materially in excess of the ranges contemplated by the Company’s budget, as approved by the Board, or in contravention of the Committee’s charter; (I) willfully breached Executive’s other duties and obligations in Section 1.3 or any other written agreement between Executive and Parent or the Company in any material respect, or willfully took or failed to take any action in contravention of the Board charters in any material respect; or (J) willfully violated any conflict of interest policy of the Company or the Board in any material respect. A termination will not be for “Cause” pursuant to clauses (A)(3), (D), (G), (H), or (I), to the extent such conduct is curable, unless Company shall have notified Executive in writing describing such conduct and prescribing conduct required to cure such conduct and Executive shall have failed to cure such conduct within ten (10) business days after his receipt of such written notice. For purposes of this definition of Cause, no act or failure to act on the part of Executive shall be considered willful if it is done, or omitted to be done, by Executive in good faith and with a good faith belief that Executive’s act or omission was in the best interests of Company or the Parent. Subject to the foregoing, (x) the decision to terminate Executive’s employment for Cause, to take other action or to take no action in response to any occurrence shall be in the sole and exclusive discretion of the Board, and (y) Executive’s employment by the Company also shall be deemed terminated for Cause if Executive resigns from the Company and the Board determines in good faith that one or more of the events described above existed as of the time of such resignation.

(iii)        “Good Reason” means a resignation by Executive occasioned by any of the following events or conditions: (1) a relocation of the principal place of performance of Executive’s duties to a location more than fifty (50) miles from the Company’s principal office in Atlanta, Georgia (unless such new principal place of performance is within fifty (50) miles from the Executive’s then-permanent residence); (2) a material reduction in Executive’s authority, duties or responsibilities (including reporting responsibilities) without Executive’s prior written consent; (3) a material reduction in Executive’s Base Salary, unless such reduction in base salary is based on a Company action affecting all executive employees of the Company and the percentage reduction of Executive’s base salary is no greater than that applied to any other executive employee of the Company; (4) a material breach of this Agreement by the Company that has a material adverse effect on Executive; or (5) a failure by the Company to pay Executive any material portion of the Base Salary, bonus or other benefits owed to Executive; provided, however, that in order for any event or condition described in clauses (1) through (5) above to constitute Good Reason hereunder, Executive must:

(A)         give the Company written notice within ten (10) days after Executive first has actual knowledge of the event or condition, which written notice identifies the event or condition and explains why Executive believes that it constitutes Good Reason; and

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(B)         (1) provide the Company twenty (20) days from the date of service of the notice described in sub-clause (A) above to cure such event or condition(to the extent such conduct is curable), and (2) terminate Executive’s employment only if such event or condition remains, to the reasonable satisfaction of Executive, uncured by the Company as of the end of such 20-day period.

ARTICLE IV
RESTRICTIVE COVENANTS

4.1          Definitions.  For purposes of this Article IV:

(a)          the term “Business” means (i) the business of providing fulfillment services, order processing, call centers, customer care services, including e-commerce fulfillment or e-commerce return services, related software platform and application services and similar and related services that the Company or any of its subsidiaries are engaged in during the Employment Term and (ii) any other business that the Company or any of its subsidiaries has taken affirmative steps towards engaging in on or prior to the Termination Date;

(b)          the term “Confidential Information” shall mean any non-public information, in whatever form or medium, concerning the operations or affairs of the Business, including, but not limited to, (i) sales, sales volume, sales methods, sales proposals, business plans, advertising and marketing plans, strategic and long-range plans, and any information related to any of the foregoing, (ii) customers, customer lists, prospective customers and customer records, (iii) general price lists and prices charged to specific customers, (iv) trade secrets, (v) financial statements, budgets and projections, (vi) software owned or developed (or being developed) for use in or relating to the conduct of the Business, (vii) the names, addresses and other contact information of all vendors and suppliers and prospective vendors and suppliers of the Business, and (viii) all other confidential or proprietary information belonging to the Company or relating to the Business; provided, however, that Confidential Information shall not include (1) knowledge, data and information that is generally known or becomes known in the trade or industry of the Company (other than as a result of a breach of this Agreement or other agreement or instrument to which Executive is bound), and (2) knowledge, data and information gained without a breach of this Agreement on a non-confidential basis from a person who is not legally prohibited from transmitting the information to Executive;

(c)          the term “Company” shall be deemed to include Parent, the Company and all of their subsidiaries;

(d)          the term “Non-Compete Restricted Period” shall mean the period commencing on the Commencement Date and terminating twelve (12) months following the termination of Executive’s employment or engagement with the Company;

(e)           the term “Non-Solicit Restricted Period” shall mean the period commencing on the Commencement Date and terminating twenty-four (24) months following the termination of Executive’s employment or engagement with the Company; and

(f)           the term “Prior Inventions” shall mean all inventions, original works of authorship, developments and improvements which were made by Executive, alone or jointly with others, prior to Executive’s employment, association or other engagement with the Company. To preclude any possibility of uncertainty, Executive has set forth on Exhibit B attached hereto a complete list of all Prior Inventions which Executive considers to be Executive’s property or the property of third parties and which Executive wishes to have excluded from the scope of this Agreement. If disclosure of any such Prior Invention on Exhibit B would cause Executive to violate any prior confidentiality agreement, Executive understands that Executive is not to list such Prior Invention in Exhibit B but is to inform the Company that all Prior Inventions have not been listed for that reason.

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4.2          Executive Acknowledgement.  Executive agrees and acknowledges that, to ensure that the Company retains its value and goodwill, Executive must not use any Confidential Information, special knowledge of the Business, or the Company’s relationships with its customers and employees, all of which Executive will continue to gain access to through Executive’s employment with the Company, other than in furtherance of Executive’s legitimate job duties. Executive further acknowledges that:

(a)          the Company is currently engaged in the Business;

(b)          the Business is highly competitive and the services to be performed by Executive for the Company are unique and national in nature;

(c)          Executive will continue to occupy a position of trust and confidence with the Company and has acquired and will acquire an intimate knowledge of Confidential Information and the Company’s relationships with its customers and employees;

(d)          the agreements and covenants contained in this Article IV are essential to protect the Company, the Confidential Information and the goodwill of the Company and are being entered into in consideration for the various rights being granted to Executive under this Agreement;

(e)           the Company would be irreparably damaged if Executive were to disclose the Confidential Information or provide services to any person or entity in violation of the provisions of this Agreement;

(f)           the scope and duration of the covenants set forth in this Article IV are reasonably designed to protect a protectable interest of the Company and are not excessive in light of the circumstances; and

(g)           Executive has the means to support himself and Executive’s dependents other than by engaging in activities prohibited by this Article IV.

4.3          Confidential Information.

(a)           At all times both during Executive’s employment and following the termination of Executive’s employment for any reason, Executive shall: (i) hold the Confidential Information in strictest confidence, take all reasonable precautions to prevent the inadvertent disclosure of the Confidential Information to any unauthorized person, and follow all the Company’s policies protecting the Confidential Information; (ii) not use, copy, divulge or otherwise disseminate or disclose any Confidential Information, or any portion thereof, to any unauthorized person; (iii) not make, or permit or cause to be made, copies of the Confidential Information, except as necessary to carry out Executive’s authorized duties as an employee of the Company; and (iv) promptly and fully advise the Company of all facts known to Executive concerning any actual or threatened unauthorized use or disclosure of which Executive becomes aware.

(b)           Executive hereby assigns to the Company any rights Executive may have or acquire in the Confidential Information, and recognizes that the Company shall be the sole owner of all copyrights, trade secret rights, and all other rights throughout the world (collectively, “Proprietary Rights”) in connection with such rights.

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(c)          If Executive receives any subpoena or becomes subject to any legal obligation that might require Executive to disclose Confidential Information, Executive will provide prompt written notice of that fact to the Company, enclosing a copy of the subpoena and any other documents describing the legal obligation. In the event that the Company objects to the disclosure of Confidential Information, by way of a motion to quash or otherwise, Executive agrees to not disclose any Confidential Information while any such objection is pending.

(d)          Executive understands that the Company has and will receive from third parties confidential or proprietary information (“Third Party Information”) under a duty to maintain the confidentiality of such Third Party Information and to use it only for limited purposes. During the term of Executive’s association with the Company and at all times after the termination of such association for any reason, Executive will hold Third Party Information in strict confidence and will not disclose or use any Third Party Information unless expressly authorized by the Company in advance or as may be strictly necessary to perform Executive’s obligations with the Company, subject to any agreements binding on the Company with respect to such Third Party Information.

(e)          Executive will not improperly use or disclose any confidential information or trade secrets, if any, of any former employer or of any other person to whom Executive has an obligation of confidentiality, and Executive will not bring onto the Company’s premises any unpublished documents or any property belonging to any former employer or of any other person to whom Executive has an obligation of confidentiality.

4.4          Ownership of Inventions.

(a)          Executive hereby agrees that any and all inventions (whether or not an application for protection has been filed under patent laws), works of authorship, information fixed in any tangible medium of expression (whether or not protected under copyright laws), Moral Rights, mask works, trademarks, trade names, trade dress, trade secrets, publicity rights, know-how, ideas (whether or not protected under trade secret laws), and all other subject matter protected under patent, copyright, Moral Right (defined as any right to claim authorship of a work, any right to object to any distortion or other modification of a work, and any similar right, existing under the law of any country, or under any treaty), mask work, trademark, trade secret, or other laws, that have been, are or will be developed, generated or produced by Executive, solely or jointly with others, at any time while employed by the Company, including during the Employment Term, are and shall be the exclusive property of the Company, subject to the obligations of this Article IV with respect to Confidential Information, and Executive hereby forever waives and agrees never to assert against the Company, its successors or licensees any and all ownership, interest, Moral Rights or similar rights with respect thereto. Executive hereby assigns to the Company all right, title and interest to the foregoing inventions, concepts, ideas and materials. This Section 4.4 does not apply to any invention or other work of Executive for which no equipment, supplies, facility or Confidential Information of the Company was used and that was developed entirely on Executive’s own time, unless the invention (A) relates to (x) the Business or (y) the Company’s actual or demonstrably anticipated research or development, or (B) results from any work performed by Executive for or on behalf of the Company. Executive shall keep and maintain adequate and current written records of all inventions, concepts, ideas and materials made by Executive (jointly or with others) during the term of Executive’s association or employment with the Company. Such records shall remain the property of the Company at all times. Executive shall promptly and fully disclose to the Company the nature and particulars of any Inventions or research project undertaken on the Company’s behalf.

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(b)          Unless the parties otherwise agree in writing, Executive is under no obligation to incorporate any Prior Inventions in any of Company’s products or processes or other Company Invention. If, in the course of Executive’s performance, Executive chooses to incorporate into any such Company product or process or other Company Invention any Prior Invention owned by Executive or in which Executive otherwise has an interest, Executive grants the Company a non-exclusive, royalty free, irrevocable, perpetual, world-wide license to copy, reproduce, make and have made, modify and create derivative works of, use, sell and license such Prior Inventions and derivative works as part of or in connection with any such Company product or process or other Company Invention.

(c)          During or subsequent to the Employment Term, Executive shall execute all papers, and otherwise provide assistance, at the Company’s reasonable request and expense, to enable the Company or its nominees to obtain and enforce all proprietary rights with respect to the Company Inventions (as defined below) in any and all countries. To that end, Executive will execute, verify and deliver such documents and perform such other acts (including appearances as a witness) as the Company may reasonably request for use in applying for, obtaining, perfecting, defending, evidencing and enforcing any such proprietary rights, and the assignment of any or all of such proprietary rights. In addition, Executive will execute, verify and deliver assignments of such rights to the Company or its designee. Executive’s obligation to assist the Company with respect to such rights shall continue beyond the termination of Executive’s association with the Company.

(d)          If, after reasonable effort, the Company cannot secure Executive’s signature on any document needed in connection with the actions specified in the preceding paragraph, Executive irrevocably designates and appoints the Company and its duly authorized officers and agents as Executive’s agent and attorney-in-fact, to act for and in Executive’s behalf to execute, verify and file any such documents and to do all other lawfully permitted acts to further the purposes of the preceding paragraph with the same legal force and effect as if executed by Executive. The power of attorney set forth in this Section 4.4 is coupled with an interest, is irrevocable, and shall survive Executive’s death, incompetence or incapacity and the termination of the Employment Term. Executive waives and quitclaims to the Company all claims of any nature whatsoever which Executive now has or may in the future obtain for infringement of any Proprietary Rights assigned under this Agreement or otherwise to the Company.

(e)          Executive acknowledges that all original works of authorship which are made by Executive (solely or jointly with others) during the course of the association with or performance of services for the Company and which are protectable by copyright are “works made for hire,” as that term is defined in the United States Copyright Act and any successor statutes. Inventions assigned to the Company or as directed by the Company under this Agreement or otherwise are referred to as “Company Inventions.”

4.5          Non-Solicitation.

(a)          During the Non-Solicit Restricted Period, Executive shall not (other than in furtherance of Executive’s legitimate job duties on behalf of Company), directly or indirectly, on Executive’s own behalf or for any other person or entity:

(i)          solicit for employment or hire, attempt to solicit for employment or hire, or employ or hire, any person who is or was employed by the Company at any time within six (6) months prior to the solicitation or hire (the “Restricted Personnel”);

(ii)         seek to influence any Restricted Personnel to leave the Company’s employment, engagement, or service; or

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(iii)        otherwise interfere with the relationship between any Restricted Personnel and the Company.

(b)          During the Non-Solicit Restricted Period, Executive shall not (other than in furtherance of Executive’s legitimate job duties on behalf of Company), directly or indirectly, on Executive’s own behalf or for any other person or entity:

(i)          solicit, entice or induce any customer that did business with the Company in the last two (2) years of Executive’s employment or any prospective customer of the Company (the “Restricted Customers”) to become a customer of any person or entity other than the Company with respect to products or services sold or under development by the Company as of Executive’s termination;

(ii)         sell, promote, or provide any product or services to a Restricted Customer if that product or service could otherwise be provided by the Company; or

(iii)        solicit, entice, induce, or assist any Restricted Customer to reduce or cease doing business with the Company or otherwise interfere with the relationship between any Restricted Customer and the Company.

4.6          Non-Competition; Investment Opportunities.

(a)          During the Non-Compete Restrictive Period, Executive shall not, directly or indirectly, alone or in combination with any other individual or entity, (i) own (other than through the passive ownership of less than one percent (1%) of the publicly traded shares of any entity), operate, manage, control, or participate in an executive, managerial, strategic, or sales role, in any individual or entity (other than the Company) that engages in or proposes to engage in the Business in the United States and any other country in which Executive worked for the Company (a “Competitive Business”); or (ii) otherwise render services to (as an employee, consultant, independent contractor or otherwise) a Competitive Business that are similar to the services Executive rendered to the Company, or that could involve the use of Confidential Information; and

(b)          During the Employment Term, if Executive learns of any investment opportunity in a business or any entity engaged in the Business, Executive shall present such investment opportunity to the Company.

4.7          If any court of competent jurisdiction shall deem any provision in this Article IV too restrictive, the other provisions shall stand, and the court shall modify the unduly restrictive provision to the point of greatest restriction permissible by law.

4.8          If this Agreement is terminated for any reason, Executive acknowledges and agrees that the restrictive covenants set forth in this Article IV (the “Restrictive Covenants”) shall survive the termination of this Agreement and Executive shall continue to be bound by the terms of this Article IV as if this Agreement was still in effect.

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4.9          The Company and Executive agree that damages will accrue to the Company by reason of Executive’s failure to observe any of the Restrictive Covenants. Therefore, if the Company shall institute any action or proceeding to enforce such provisions, Executive waives the claim or defense that there is an adequate remedy at law and agrees in any such action or proceeding not to (i) interpose the claim or defense that such remedy exists at law, or (ii) require the Company to show that monetary damages cannot be measured or to post any bond. Without limiting any other remedies that may be available to the Company, Executive hereby specifically affirms the appropriateness of injunctive or other equitable relief in any such action. Executive also acknowledges that the remedies afforded the Company pursuant to this Section 4.9 are not exclusive, nor shall they preclude the Company from seeking or receiving any other relief, including without limitation, any form of monetary or other equitable relief. Upon the reasonable request by the Company, Executive shall provide reasonable assurances and evidence of compliance with the Restrictive Covenants.

ARTICLE V
POST-TERMINATION OBLIGATIONS

5.1          Return of Company Materials.  No later than three (3) business days following the termination of Executive’s employment for any reason, Executive shall return to the Company, and shall not retain in any form or media of expression, all Company and Affiliate property that is then in Executive’s possession, custody or control, including, without limitation, all keys, access cards, credit cards, computer hardware and software, documents, records, policies, marketing information, design information, specifications and plans, data base information and lists, and any other property or information that Executive has or had relating to the Company or any Affiliate (whether those materials are in paper or computer-stored form), and including but not limited to any documents containing, summarizing, or describing any Confidential Information.

5.2          Executive Assistance.  During the Employment Term and for a reasonable period thereafter, Executive shall, upon reasonable notice, assist the Company and its subsidiaries (the “Affiliated Group”) in the defense of any claims, or potential claims that may be made or threatened to be made against any member of the Affiliated Group in any action, suit or proceeding, whether civil, criminal, administrative, investigative or otherwise (a “Proceeding”), and will assist the Affiliated Group in the prosecution of any claims that may be made by any member of the Affiliated Group in any Proceeding, to the extent that such claims may relate to Executive’s employment or the period of Executive’s employment by the Company. The Company shall reimburse Executive for all of the Executive’s reasonable out-of-pocket expenses associated with such assistance, including travel expenses and any attorneys’ fees and shall pay a reasonable per diem fee for the Executive’s service under this Section 5.2. Any services or assistance contemplated in this Section 5.2 shall be at mutually agreed to and convenient times.

ARTICLE VI
MISCELLANEOUS

6.1          Notices.  Any notices, consents or other communications required or permitted to be sent or given hereunder shall be in writing and shall be deemed properly served if (i) delivered personally, in which case the date of such notice shall be the date of delivery; (ii) delivered to a nationally recognized overnight courier service, in which case the date of delivery shall be the next business day; or (iii) sent by facsimile transmission (with a copy sent by first-class mail), in which case the date of delivery shall be the date of transmission, or if after 5:00 P.M., the next business day. If not personally delivered, notice shall be sent addressed as follows: (x) if to Executive, to the address listed on the signature page hereof, and (y) if to the Company, at c/o Sterling Partners, 401 North Michigan Avenue, Suite 3300, Chicago, IL 60611, Attention: Office of General Counsel, Facsimile No. (312) 465-7100, or in either case at such other address as may hereafter be specified by notice given by either party to the other party. Executive shall promptly notify the Company of any change in his address set forth on the signature page.

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6.2          Successors and Assigns.  This Agreement shall be binding upon, and inure to the benefit of, and be enforceable by, the parties hereto and the Company’s successors and permitted assigns. In the case of the Company, the successors and permitted assigns hereunder shall include without limitation any Affiliate as well as the successors in interest to the Company or any such Affiliate (whether by merger, liquidation (including successive mergers or liquidations) or otherwise). This Agreement or any right or interest hereunder is one of personal service and may not be assigned by Executive under any circumstance. Nothing in this Agreement, whether expressed or implied, is intended or shall be construed to confer upon any person other than the parties and successors and assigns permitted by this Section 6.2 any right, remedy or claim under or by reason of this Agreement.

6.3          Entire Agreement; Amendments.  This Agreement, the Exhibits hereto, the Equity Documents and the Subscription Agreement embody the complete agreement and understanding of the parties hereto with regard to the subject matter hereof and supersede and preempt any prior agreements, understandings, letters of intent, or representations by or among the parties, written or oral, which may have related to the subject matter hereof. This Agreement shall not be amended, modified or supplemented except by a written instrument signed by each of the parties hereto.

6.4          Interpretation.  Article titles and section headings contained herein are inserted for convenience of reference only and are not intended to be a part of or to affect the meaning or interpretation of this Agreement.

6.5          Waivers.  No provision of this Agreement may be waived except in a writing executed and delivered by the party against whom waiver is sought. Any such written waiver shall be effective only with respect to the event or circumstance described therein and not with respect to any other event or circumstance, unless such waiver expressly provides to the contrary.

6.6          Partial Invalidity.  Wherever possible, each term and provision of this Agreement shall be interpreted so as to be effective and valid under applicable law. If any term or provision shall be held invalid or unenforceable, the remaining terms and provisions hereof not be affected thereby, unless such a construction would be unreasonable. Executive’s obligations in Articles IV and V shall survive and continue in full force notwithstanding the termination of this Agreement or Executive’s employment for any reason.

6.7          Tax Matters.  Executive acknowledges that no representative or agent of Parent or the Company has provided Executive with any tax advice of any nature, and Executive has had the opportunity to consult with his own legal, tax and financial advisor(s) as to tax and related matters concerning the compensation to be received under this Agreement.

6.8          Offset.  To the extent permitted by law, and to the extent that such action will not result in the imposition of additional taxes, interest or penalties pursuant to Section 409A (as defined below), the Company may offset any amounts Executive owes it pursuant to this Agreement or any other written agreement, note or other instrument relating to indebtedness for borrowed money to which Executive is a party or pursuant to any other liability or obligation by which Executive is bound against any amounts it owes Executive hereunder.

6.9          Execution in Counterparts.  This Agreement may be executed in one or more counterparts, each of which shall be considered an original instrument, but all of which shall be considered one and the same agreement.

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6.10        Required Delay for Deferred Compensation Under 409A.  Notwithstanding any other provision of this Agreement, if at the time of separation from service Executive is determined by the Company to be a “specified employee” (as defined in Section 409A of the Code (together, with any state law of similar effect, “Section 409A”) and Section 1.409A-1(i) of the Treasury Regulations), and the Company determines that delayed commencement of any portion of the termination payments and benefits payable to Executive pursuant to this Agreement is required in order to avoid a prohibited distribution under Section 409A(a)(2)(B)(i) of the Code, then such portion of Executive’s termination payments and benefits shall not be provided to Executive prior to the earliest of (1) the date that is six months and one day after Executive’s separation from service, (2) the date of Executive’s death or (3) such earlier date as is permitted under Section 409A (any such delayed commencement, a “Payment Delay”). Upon the expiration of such Payment Delay, all payments deferred pursuant to a Payment Delay shall be paid in a lump sum to Executive on the first day following the expiration of the Payment Delay, and any remaining payments due under the Agreement shall be paid on the original schedule provided herein.

This Agreement is intended to meet the requirements of Section 409A, and shall be interpreted and construed consistent with that intent. References to termination of employment, retirement, separation from service and similar or correlative terms in this Agreement shall mean a “separation from service” (as defined at Section 1.409A-1(h) of the Treasury Regulations) from the Company and from all other corporations and trades or businesses, if any, that would be treated as a single “service recipient” with the Company under Section 1.409A-1(h)(3) of the Treasury Regulations. Each installment of the payments and benefits provided for in this Agreement shall be treated as a separate “payment” for purposes of Treasury Regulation Section 1.409A-2(b)(2)(i).

6.11        Governing Law; Consent to Jurisdiction; Waiver of Jury.  This Agreement shall be governed by and construed in accordance with the internal laws of the State of Georgia, without regard to its conflict of law principles. For the purposes of any suit, action, or other proceeding arising out of this Agreement or with respect to Executive’s employment hereunder, the Parties hereto: (i) agree to submit to the exclusive jurisdiction of the federal or state courts located in Fulton County, State of Georgia, (ii) agree to unconditionally waive any objection to venue in such jurisdiction, and agree not to plead or claim forum non conveniens, and (iii) to waive their respective rights to a jury trial of any and such claims and causes of action.

6.12        Construction.  The language used in this Agreement will be deemed to be the language chosen by Executive and the Company to express their mutual intent, and no rule of strict construction will be applied against Executive or the Company.

*          *          *

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IN WITNESS WHEREOF, the Company has caused this Amended and Restated Employment Agreement to be duly executed by an officer thereunto duly authorized, and Executive has hereunto set his hand, all as of the day and year first above written.

THE COMPANY:
INNOTRAC CORPORATION
By:	/s/ Scott Dorfman
	Name:	Scott Dorman
	Title:	Chief Executive Officer
EXECUTIVE:
/s/ Larry Hanger
Name: Larry Hanger
Address:		[REDACTED]
		[REDACTED]
Phone:		[REDACTED]
Fax:

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Exhibit A

Form of Release

THIS RELEASE (the “Release”) is entered into between Larry Hanger (“Executive”) and Innotrac Corporation, a Georgia corporation (the “Company”), for the benefit of the Company. The entering into and non-revocation of this Release is a condition to Executive’s right to receive the payments under Section 3.2 of the Amended and Restated Employment Agreement entered into by and between Executive and the Company, dated as of November 14, 2013 (the “Employment Agreement”). Capitalized terms used and not defined herein shall have the meaning provided in the Employment Agreement.

Accordingly, Executive and the Company agree as follows.

1.           In consideration for the payments and other benefits provided to Executive under Section 3.2(a) of the Employment Agreement, Executive represents and agrees, as follows:

(a)          Executive, for himself, his heirs, administrators, representatives, executors, successors and assigns (collectively “Releasers”), hereby irrevocably and unconditionally releases, acquits and forever discharges and agrees not to sue the Company or any of its parents, subsidiaries, divisions, affiliates and related entities and its current and former directors, officers, shareholders, trustees, employees, consultants, independent contractors, representatives, agents, servants, successors and assigns and all persons acting by, through or under or in concert with any of them (collectively “Releasees”), from all claims, rights and liabilities up to and including the date of this Release arising from or relating to Executive’s employment with, or termination of employment from, the Company, under the Employment Agreement and from any and all charges, complaints, claims, liabilities, obligations, promises, agreements, controversies, damages, actions, causes of actions, suits, rights, demands, costs, losses, debts and expenses of any nature whatsoever, known or unknown, suspected or unsuspected and any claims of wrongful discharge, breach of contract, implied contract, promissory estoppel, defamation, slander, libel, tortious conduct, employment discrimination or claims under any federal, state or local employment statute, law, order or ordinance, including any rights or claims arising under Title VII of the Civil Rights Act of 1964, as amended, the Age Discrimination in Employment Act of 1967, as amended, 29 U.S.C. § 621 et seq. (“ADEA”), or any other federal, state or municipal ordinance relating to discrimination in employment. Nothing contained herein shall restrict the parties’ rights to enforce the terms of this Release.

(b)          To the maximum extent permitted by law, Executive agrees that he has not filed, nor will he ever file, a lawsuit asserting any claims which are released by this Release.

(c)          This Release specifically excludes Executive’s rights and the Company’s obligations under Sections 3.2 and 6.14 of the Employment Agreement, the Benefit Plans, and the Equity Documents. Executive’s entitlement to vested benefits under the Benefit Plans and the Equity Documents shall be determined in accordance with the provisions of the Benefit Plans or Equity Documents, as the case may be. Nothing contained in this Release shall release Executive from his obligations, including any obligations to abide by restrictive covenants, under the Employment Agreement, the Equity Documents or the Benefit Plans that continue or are to be performed following termination of employment.

(d)          The parties agree that this Release shall not affect the rights and responsibilities of the US Equal Employment Opportunity Commission (hereinafter “EEOC”) to enforce ADEA and other laws. In addition, the parties agree that this Release shall not be used to justify interfering with Executive’s protected right to file a charge or participate in an investigation or proceeding conducted by the EEOC. The parties further agree that Executive knowingly and voluntarily waives all rights or claims (that arose prior to Executive’s execution of this Release) the Releasers may have against the Releasees, or any of them, to receive any benefit or remedial relief (including, but not limited to, reinstatement, back pay, front pay, damages, attorneys’ fees, experts’ fees) as a consequence of any investigation or proceeding conducted by the EEOC.

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2.          Executive acknowledges that the Company has specifically advised him of the right to seek the advice of an attorney concerning the terms and conditions of this Release. Executive further acknowledges that he has been furnished with a copy of this Release, and he has been afforded twenty-one (21) days in which to consider the terms and conditions set forth above prior to this Release. By executing this Release, Executive affirmatively states that he has had sufficient and reasonable time to review this Release and to consult with an attorney concerning his legal rights prior to the final execution of this Release. Executive further agrees that he has carefully read this Release and fully understands its terms. Executive understands that he may revoke this Release within seven (7) days after signing this Release. Revocation of this Release must be made in writing and must be received by [●] at [●] within the time period set forth above.

3.          This Release will be governed by and construed in accordance with the laws of the state of Georgia, without giving effect to any choice of law or conflicting provision or rule (whether of the state of Georgia or any other jurisdiction) that would cause the laws of any jurisdiction other than the state of Georgia to be applied. In furtherance of the foregoing, the internal law of the state of Georgia will control the interpretation and construction of this agreement, even if under such jurisdiction’s choice of law or conflict of law analysis, the substantive law of some other jurisdiction would ordinarily apply. The provisions of this Release are severable, and if any part or portion of it is found to be unenforceable, the other paragraphs shall remain fully valid and enforceable. This Release shall become effective and enforceable on the eighth day following its execution by Executive, provided he does not exercise his right of revocation as described above. If Executive fails to sign and deliver this Release or revokes his signature, this Release will be without force or effect, and Executive shall not be entitled to the payment under Section 3.2 of the Employment Agreement.

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Exhibit B

Prior Inventions

None.

19

EX-10.7

Exhibit 10.7

EMPLOYMENT AGREEMENT

This EMPLOYMENT AGREEMENT (the “Agreement”) is made as of November 14, 2013 (but effective as of the Commencement Date, as defined below), by and between Innotrac Corporation, a Georgia corporation (the “Company”), and Steve Keaveney (“Executive”).

RECITALS

A.           Immediately following the execution and delivery of this Agreement, the Company, Blue Eagle Holdings, L.P., a Delaware limited partnership (“Parent”), and Blue Eagle Acquisition Sub, Inc., a Georgia corporation and wholly owned subsidiary of Parent (“Purchaser”), will enter into that certain Agreement and Plan of Merger, dated as of the date hereof (the “Merger Agreement”).

B.           On the terms and subject to the conditions set forth in the Merger Agreement, (i) Purchaser will commence a tender offer to purchase (the “Offer”) all of the issued and outstanding shares of common stock of the Company, par value $0.10 per share (the “Common Stock”), at an offer price equal to the Offer Price (as defined in the Merger Agreement) payable to the seller in cash, without interest, subject to withholding of taxes required by applicable Law and (ii) following the consummation of the Offer and at the Effective Time (as defined in the Merger Agreement), Purchaser will merge with and into the Company (the “Merger”), with the Company continuing as the surviving corporation, whereby each issued and outstanding share of Common Stock (other than Excluded Shares (as defined in the Merger Agreement)) will be converted into the right to receive the Common Merger Consideration (as defined in the Merger Agreement) payable to the seller in cash, without interest, subject to withholding of taxes required by applicable Law.

C.           Simultaneous with the execution and delivery of this Agreement, the Company is entering into employment agreements (the “Other Employment Agreements”) with certain other executives of the Company (the “Other Executives”).

D.           As a condition and inducement to Parent and Purchaser entering into and incurring their respective obligations under the Merger Agreement, Executive and the Company have agreed to enter into this Agreement.

NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth below, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Company and Executive agree as follows:

ARTICLE I
EMPLOYMENT SERVICES

1.1           Term of Employment. Executive’s employment under this Agreement shall commence and be effective at the Effective Time (the “Commencement Date”) and continue until terminated pursuant to Article III below (the “Employment Term”). This Agreement shall terminate automatically and will be of no force or effect upon any termination of the Merger Agreement in accordance with its terms prior to the occurrence of the Effective Time.

1.2           Title and Position. During the Employment Term, Executive shall hold the position of Chief Financial Officer of the Company, and shall report directly to the Chief Executive Officer of the Company. Executive’s responsibilities shall include such duties as are commensurate with Executive’s position and as may be assigned to Executive in good faith by the Board of Directors of the Company (the “Board”) or the Chief Executive Officer.

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1.3         Activities and Duties During Employment.

(a)          Executive shall conduct himself, both professionally and personally, with due regard to public conventions and morals, and in a manner that will not have a materially adverse effect on the reputation of the Company or Executive. Executive shall devote Executive’s full business time, attention, skill and energy to the business and affairs of the Company and its subsidiaries, and shall use Executive’s reasonable best efforts to faithfully perform Executive’s responsibilities in a diligent, trustworthy, efficient and businesslike manner so as to advance the best interests of the Company. Notwithstanding the foregoing, Executive shall be permitted to devote a reasonable amount of time and effort to (i) serving on governing boards of or otherwise assisting civic and charitable organizations, and (ii) investing and managing personal and family investments, but only to the extent that activities described in clauses (i) or (ii), individually or as a whole, do not (A) involve Executive’s active participation in the management of any corporation, partnership or other business entity, (B) involve an ownership interest in any customer or vendor of the Company unless approved in advance by written resolution of the Board, (C) interfere with the Executive’s duties to the Company in any material respect, or (D) otherwise violate any provision of this Agreement in any material respect. Executive shall not have any ownership interest in any customer or vendor of Parent the Company or any of their subsidiaries unless approved in advance by written resolution of the Board.

(b)          Executive shall comply in all material respects with all applicable laws, and all written policies, rules and regulations of the Company, including without limitation codes of conduct and any charter of the Board or any compensation committee of the Board (the “Committee”), as applicable.

ARTICLE II
COMPENSATION

2.1         Base Salary. During the Employment Term, Executive shall receive an initial annual base salary of $250,000 (“Base Salary”), less applicable withholdings, payable in accordance with the general payroll practices of the Company(but no less infrequently than in equal monthly installments). The Base Salary will be reviewed by the Board or the Committee or its designee at least annually for increase (but not for decrease, except to the extent permitted under Section 3.2(c)(iii)(3)). As so adjusted, the Base Salary shall thereafter be Executive’s “Base Salary” for all purposes under this Agreement.

2.2         Incentive Bonus.

(a)          The Company shall establish a performance-based bonus plan (the “Plan”) pursuant to which Executive shall be eligible to receive an annual incentive bonus (the “Annual Bonus”) with respect to each fiscal year of Company (“Fiscal Year”) ending during the Employment Term, subject to the achievement of financial performance objectives and “management by objective” goals as previously established by the Board in consultation with the Chief Executive Officer, which objectives shall be reasonably related to the Company’s business objectives. The Board or the Committee shall administer the Plan, and shall have the sole discretion to determine if the goals have been attained and what percentage of Base Salary, if any, will be paid as an Annual Bonus; provided any such determinations are made reasonably and in good faith. To the extent the goals are financial in nature, the Board shall base its determination on the audit, review or compilation of the Company’s financial results submitted by the Company’s independent accountants, which determination shall be made within thirty (30) days of receipt by the Company of such audit, review or compilation (the date on which the Committee makes such determination, the “Bonus Determination Date”). Executive acknowledges that (i) no Annual Bonus shall be earned or accrued until the corresponding Bonus Determination Date and (ii) in order to receive an Annual Bonus with respect to a Fiscal Year, Executive must remain continuously employed by the Company through and including the first day of the Fiscal Year following the Fiscal Year to which such Annual Bonus relates and provided that Executive’s employment with the Company is not terminated by the Company for Cause prior to the Bonus Determination Date. The Annual Bonus shall be paid as soon as practicable after the Bonus Determination Date, but in no event later than December 31 of the Fiscal Year following the Fiscal Year for which the Annual Bonus relates. With respect to the Company’s 2013 Fiscal Year, Executive will be entitled to a Bonus under the Company’s 2013 Executive Bonus Plan (the “2013 Bonus”), which shall be paid as soon as practicable after the thirtieth (30^th) day following receipt by the Board of the Company’s audit for the 2013 Fiscal Year, but in no event later than December 31, 2014. Executive acknowledges that (x) the 2013 Bonus shall not be earned or accrued until the thirtieth (30^th) day following receipt by the Board of the Company’s audit for the 2013 Fiscal Year (the “2013 Bonus Determination Date”) and (y) in order to receive the 2013 Bonus, Executive must remain continuously employed by the Company through and including the first day of the Fiscal Year following the 2013 Fiscal Year and provided that Executive’s employment with the Company is not terminated by the Company for Cause prior to the 2013 Bonus Determination Date.

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(b)          Should the Board determine that an Annual Bonus to Executive was based on an audit, review or compilation that is later found to be materially misstated or inaccurate in any material respect, the Board shall have the right to require Executive to remit to the Company any excess bonus amount paid as a result of such materially misstated or inaccurate audit, review or compilation (an “Excess Bonus Amount”). Executive shall remit the Excess Bonus Amount to the Company within 30 days after receiving written notice (an “Excess Bonus Notice”) from the Board describing the reason for overpayment and the Excess Bonus Amount due from Executive. Notwithstanding the foregoing, if an Excess Bonus Notice is first given at any time after the second anniversary of the date on which the corresponding Excess Bonus Amount was paid to Executive by the Company, and the determination of such Excess Bonus Amount does not, in any respect, relate to, or arise from, any acts or omissions in financial reporting or accounting practices that occurred at the direction, or with the knowledge, of Executive, then the Company’s right to recover such Excess Bonus Amount thereafter shall only be accomplished through the exercise of its right of offset in Section 6.8 (and subject to the limitations therein).

2.3         Reimbursement of Expenses. The Company shall reimburse Executive for all reasonable expenses incurred by Executive while performing Executive’s duties under this Agreement, subject to the Company’s policies in effect from time to time and corroborating documentation reasonably satisfactory to the Company.

2.4         Health Care and Benefit Plans. During the Employment Term, Executive shall be eligible to receive all fringe benefits and perquisites and entitled to participate in all incentive, savings and retirement plans, practices, policies and programs applicable generally to other senior-level executives of the Company and shall be eligible for participation in, and shall receive all benefits under, any health or welfare benefit plans, practices, policies and programs provided by the Company normally available to other senior-level executives of the Company (subject to all applicable eligibility and contribution policies and rules), as may be in effect from time to time, including such insurance programs as may be implemented by the Company (“Benefit Plans”).

2.5         Key Man Insurance. Executive shall make application for, and submit to such examinations as may reasonably be requested by the Board in order to obtain key man or other insurance on the life of Executive for the benefit of the Company as the Board shall direct, the cost of which insurance shall be borne by the Company.

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2.6         Vacation. Executive shall receive four (4) weeks of paid vacation days per calendar year, to accrue pro rata on a monthly basis and to be administered in accordance with the Company’s policies and procedures (provided, however, that such policies shall not enhance Executive’s number of vacation days or otherwise conflict with this Section 2.6). Such vacation may be taken, in Executive’s discretion, subject to the reasonable business needs of the Company. Vacation time may not be carried over from one calendar year to the next, but rather must be used in the calendar year in which it is earned.

2.7         Awards Pursuant Parent’s Equity Incentive Plan. Executive and the Company acknowledge that on the Commencement Date, Parent shall grant Executive options to acquire the number of Common Units equal to one and one-quarter percent (1.25%) of the fully-diluted equity of Parent pursuant to the terms and subject to the conditions set forth in the Blue Eagle Equity Incentive Plan (the “Incentive Plan”) and Award Agreement thereunder (“Award Agreement,” together with the Incentive Plan, the “Plan Documents”).

2.8         Amended and Restated Limited Partnership Agreement. All equity of Parent acquired by Executive pursuant to the Plan Documents shall be subject to the terms and conditions of the Amended and Restated Limited Partnership Agreement of Parent (the “Partnership Agreement”, collectively with the Plan Documents, the “Equity Documents”).

ARTICLE III
TERMINATION OF EMPLOYMENT

3.1         Employment At Will. Executive’s employment by the Company is at-will, and either Executive or the Company may terminate Executive’s employment with the Company (the effective date of separation being the “Termination Date”), subject to the following:

(a)          The Company may terminate Executive’s employment at any time with Cause by giving written notice of such termination to Executive designating an immediate or future termination date.

(b)          Executive may terminate Executive’s employment for Good Reason or without Good Reason by giving the Company thirty (30) days prior written notice of termination. Upon such notice, the Company may, at its option, (i) make Executive’s termination effective immediately, (ii) require Executive to continue to perform Executive’s duties hereunder during such 30-day period, with or without restrictions on Executive’s activities, and/or (iii) accept Executive’s notice of termination as Executive’s resignation from the Company at any time during such 30-day period on behalf of the Company. If the Company elects (i) above, the Company shall have no obligation to provide Executive any compensation or benefits beyond the Termination Date except for payment of Executive’s Base Salary under Section 2.1 and benefits under Section 2.4 that have accrued through the Termination Date, any severance payments or benefits under Section 3.2, or as otherwise required by law. If the Company elects (ii) or (iii) above, the Company shall pay Executive’s Base Salary under Section 2.1 and benefits under Section 2.4 through the date on which Executive voluntarily ceases to perform services for the Company, in addition to payment of any severance payments or benefits to Executive under Section 3.2.

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(c)          Executive’s employment will terminate immediately without any notice upon Executive’s death. If the Company determines in good faith that Executive is Disabled or Incapacitated during the Employment Term (pursuant to the definition of Disabled or Incapacitated set forth below), the Company may give Executive written notice in accordance with Section 3(d) of its intention to terminate Executive’s employment. In such event, Executive’s employment with the Company shall terminate effective on the 30^th day after receipt of such notice by Executive (the “Disability Effective Date”); provided that within the 30-day period after such receipt, Executive shall not have returned to full time performance of Executive’s duties. For purposes of this Agreement, “Disabled or Incapacitated” means Executive’s inability or failure, due to a medically determinable physical or mental impairment, to substantially perform the essential functions of Executive’s job, with or without a reasonable accommodation, for thirty (30) consecutive calendar days or for ninety (90) calendar days during any twelve (12)-month period irrespective of whether such days are consecutive. Whether Executive is “Disabled or Incapacitated” shall be determined by a physician selected by the Company or its insurers, which physician is reasonably acceptable to Executive. Upon request, Executive shall provide the Board with documentation from Executive’s health care provider sufficient for the Board to determine the nature and extent of any physical or mental impairment that may interfere with Executive’s performance of Executive’s job duties, as well as any accommodations that could be made. If Executive’s employment is terminated pursuant to this Section 3.1(c), the Company shall have no obligation to provide Executive any compensation or benefits beyond the Termination Date except for payment of Executive’s Base Salary under Section 2.1 and benefits under Section 2.4 that have accrued through the Termination Date or as otherwise required by law.

(d)          Any termination by the Company for Cause or without Cause, or by Executive for Good Reason or without Good Reason, shall be communicated by Notice of Termination to the other party hereto given in accordance with Section 6.1 of this Agreement. For purposes of this Agreement, a “Notice of Termination” means a written notice which (i) indicates the specific termination provision in this Agreement relied upon, (ii) to the extent applicable, sets forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of Executive’s employment under the provision so indicated and (iii) if the Termination Date is other than the date of receipt of such notice, specifies the termination date. The failure by Executive or the Company to set forth in the Notice of Termination any fact or circumstance which contributes to a showing of Good Reason or Cause shall not waive any right of Executive or the Company hereunder or preclude Executive or Company from asserting such fact or circumstance in enforcing Executive’s or Company’s rights hereunder.

(e)          The “Termination Date” means (i) if Executive’s employment is terminated by Company for Cause or by Executive for Good Reason, the date of receipt of the Notice of Termination or any later date specified therein pursuant to Section 3(d), or as provided in Section 3.1(b), as the case may be, (ii) if Executive’s employment is terminated by the Company without Cause or by Executive without Good Reason, the effective date of separation, (iii) if Executive’s employment is terminated by reason of Disability, the Disability Effective Date, and (iv) if Executive’s employment is terminated by reason of death, the date of death.

3.2         Company Obligations Upon Termination.

(a)          If the Company terminates Executive’s employment without Cause or Executive terminates his employment for Good Reason, then the Company will provide Executive with the following severance payments and/or benefits:

(i)          Prior to the thirtieth day following the Termination Date, the Company shall pay to Executive in a lump sum, to the extent not previously paid, (x) the Base Salary through the Termination Date and (y) the Annual Bonus earned for any Fiscal Year ended prior to the year in which the Termination Date occurs, provided that Executive was employed on the last day of such Fiscal Year (the “Accrued Obligations”);

(ii)         Starting as of the next applicable Company payroll date after the Termination Date (provided Executive has complied with Section 3.2(b)), the Company will pay Executive a monthly amount equal to the (x) Base Salary, divided by (y) 12 (the “Cash Severance”), until the end of the ninth (9^th) month following the Termination Date (the “Severance Period”); and

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(iii)        During the Severance Period, the Company shall continue the health and welfare benefits to Executive and, where applicable, Executive’s dependents on the same terms that would have been provided to them had Executive continued employment with Company in accordance with the health and welfare benefits provided pursuant to Section 2.4.

(b)          The obligations of the Company to make payments under Section 3.2(a) (other than the Accrued Obligations) are conditioned on Executive executing and delivering a general release of claims against the Company, its Affiliates, and each of their respective officers, directors, members, managers, partners and shareholders with respect to Executive’s employment, in substantially the form attached hereto as Exhibit B (the “Release”). If (i) the Board reasonably and in good faith believes that Executive has breached in any material respect any of Executive’s obligations in Article IV or (ii) Executive’s agrees to become employed by or to provide services to any entity that is an Affiliate of Sterling Fund Management, LLC, then the Board may unilaterally suspend Executive’s right to receive any Cash Severance then or thereafter due from Company to Executive, provided that in the case of clause (i), the Board (A) gives Executive advance written notice of such suspension and (B) initiates an action or claim to enforce Company’s rights in respect of such restrictive covenants promptly after such suspension. In the event that Company prevails on such action or claim, Executive’s right to receive, and Company’s obligation to pay, any additional Cash Severance, including any previously suspended amounts, shall be terminated immediately, and Executive shall have no further rights to Cash Severance. In the event that Executive prevails on such action or claim, Company shall be required to pay to Executive in a lump sum within thirty (30) days of such adjudication any Cash Severance the payment of which was delayed due to such suspension, plus interest for any period during which the payment of the Cash Severance was suspended at the prime rate, as published in the Wall Street Journal on the date of such suspension, and to commence payment of future installments of Cash Severance in accordance with Section 3.2(a)(ii) plus legal fees of Executive required in the defense.

(c)          For purposes of this Agreement:

(i)          The term “Affiliate” means, with respect to Parent: (A) any other entity or person owning 10% or more of the voting or beneficial interests of Parent; (B) the Company and any other entity or person directly or indirectly controlling, controlled by or under common control with Parent; or (C) any other entity in which more than 10% of the voting or beneficial interests are owned by one or more persons or entities who have a relationship with Parent described in clauses (A) or (B); provided that, for the purposes of this definition, “control” (including, with correlative meanings, the terms “controlled by” and “under common control with”), as used with respect to any person or entity, shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of such person or entity, whether through the ownership of voting securities, by contract or otherwise.

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(ii)         The term “Cause” means that Executive has: (A) engaged in (1) a material act of dishonesty involving the Company or its Affiliates, (2) malfeasance or gross negligence which is injurious to the Company, or (3) a material breach of his fiduciary duties related to employment; (B) committed an act of fraud or embezzlement, (C) committed any crime of moral turpitude or any felony; (D) repeatedly refused to perform specific reasonable directives from the Board or any officer of the Company to whom Executive reports that are reasonably consistent with the scope and nature of Executive’s responsibilities (other than such failure resulting from his disability or incapacity); (E) used or been under the influence of illegal drugs at the workplace or while performing Company business, or refused to submit for a drug test upon the Company’s reasonable request; (F) breached any provision of Article IV in any material respect; (G) failed to obtain the Board’s consent prior to causing the Company or any of its subsidiaries to engage in any business with any family members, their Affiliates or any entities they work with after the Commencement Date; (H) caused, directed or permitted Parent, the Company or any of their subsidiaries to grant incentive equity to any person on terms and conditions not specifically approved by the Board or the Committee, or caused, directed or permitted the Company to pay bonuses or grant raises to employees or other service providers of the Company in amounts materially in excess of the ranges contemplated by the Company’s budget, as approved by the Board, or in contravention of the Committee’s charter; (I) willfully breached Executive’s other duties and obligations in Section 1.3 or any other written agreement between Executive and Parent or the Company in any material respect, or willfully took or failed to take any action in contravention of the Board charters in any material respect; or (J) willfully violated any conflict of interest policy of the Company or the Board in any material respect. A termination will not be for “Cause” pursuant to clauses (A)(3), (D), (G), (H), or (I), to the extent such conduct is curable, unless Company shall have notified Executive in writing describing such conduct and prescribing conduct required to cure such conduct and Executive shall have failed to cure such conduct within ten (10) business days after his receipt of such written notice. For purposes of this definition of Cause, no act or failure to act on the part of Executive shall be considered willful if it is done, or omitted to be done, by Executive in good faith and with a good faith belief that Executive’s act or omission was in the best interests of Company or the Parent. Subject to the foregoing, (x) the decision to terminate Executive’s employment for Cause, to take other action or to take no action in response to any occurrence shall be in the sole and exclusive discretion of the Board, and (y) Executive’s employment by the Company also shall be deemed terminated for Cause if Executive resigns from the Company and the Board determines in good faith that one or more of the events described above existed as of the time of such resignation.

(iii)        “Good Reason” means a resignation by Executive occasioned by any of the following events or conditions: (1) a relocation of the principal place of performance of Executive’s duties to a location more than fifty (50) miles from the Company’s principal office in Atlanta, Georgia (unless such new principal place of performance is within fifty (50) miles from the Executive’s then-permanent residence); (2) a material reduction in Executive’s authority, duties or responsibilities (including reporting responsibilities) without Executive’s prior written consent; (3) a material reduction in Executive’s Base Salary, unless such reduction in base salary is based on a Company action affecting all executive employees of the Company and the percentage reduction of Executive’s base salary is no greater than that applied to any other executive employee of the Company; (4) a material breach of this Agreement by the Company that has a material adverse effect on Executive; or (5) a failure by the Company to pay Executive any material portion of the Base Salary, bonus or other benefits owed to Executive; provided, however, that in order for any event or condition described in clauses (1) through (5) above to constitute Good Reason hereunder, Executive must:

(A)         give the Company written notice within ten (10) days after Executive first has actual knowledge of the event or condition, which written notice identifies the event or condition and explains why Executive believes that it constitutes Good Reason; and

(B)         (1) provide the Company twenty (20) days from the date of service of the notice described in sub-clause (A) above to cure such event or condition(to the extent such conduct is curable), and (2) terminate Executive’s employment only if such event or condition remains, to the reasonable satisfaction of Executive, uncured by the Company as of the end of such 20-day period.

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ARTICLE IV
RESTRICTIVE COVENANTS

4.1         Definitions. For purposes of this Article IV:

(a)          the term “Business” means (i) the business of providing fulfillment services, order processing, call centers, customer care services, including e-commerce fulfillment or e-commerce return services, related software platform and application services and similar and related services that the Company or any of its subsidiaries are engaged in during the Employment Term and (ii) any other business that the Company or any of its subsidiaries has taken affirmative steps towards engaging in on or prior to the Termination Date;

(b)          the term “Confidential Information” shall mean any non-public information, in whatever form or medium, concerning the operations or affairs of the Business, including, but not limited to, (i) sales, sales volume, sales methods, sales proposals, business plans, advertising and marketing plans, strategic and long-range plans, and any information related to any of the foregoing, (ii) customers, customer lists, prospective customers and customer records, (iii) general price lists and prices charged to specific customers, (iv) trade secrets, (v) financial statements, budgets and projections, (vi) software owned or developed (or being developed) for use in or relating to the conduct of the Business, (vii) the names, addresses and other contact information of all vendors and suppliers and prospective vendors and suppliers of the Business, and (viii) all other confidential or proprietary information belonging to the Company or relating to the Business; provided, however, that Confidential Information shall not include (1) knowledge, data and information that is generally known or becomes known in the trade or industry of the Company (other than as a result of a breach of this Agreement or other agreement or instrument to which Executive is bound), and (2) knowledge, data and information gained without a breach of this Agreement on a non-confidential basis from a person who is not legally prohibited from transmitting the information to Executive;

(c)          the term “Company” shall be deemed to include Parent, the Company and all of their subsidiaries;

(d)          the term “Non-Compete Restricted Period” shall mean the period commencing on the Commencement Date and terminating twelve (12) months following the termination of Executive’s employment or engagement with the Company;

(e)          the term “Non-Solicit Restricted Period” shall mean the period commencing on the Commencement Date and terminating twenty-four (24) months following the termination of Executive’s employment or engagement with the Company; and

(f)           the term “Prior Inventions” shall mean all inventions, original works of authorship, developments and improvements which were made by Executive, alone or jointly with others, prior to Executive’s employment, association or other engagement with the Company. To preclude any possibility of uncertainty, Executive has set forth on Exhibit B attached hereto a complete list of all Prior Inventions which Executive considers to be Executive’s property or the property of third parties and which Executive wishes to have excluded from the scope of this Agreement. If disclosure of any such Prior Invention on Exhibit B would cause Executive to violate any prior confidentiality agreement, Executive understands that Executive is not to list such Prior Invention in Exhibit B but is to inform the Company that all Prior Inventions have not been listed for that reason.

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4.2         Executive Acknowledgement. Executive agrees and acknowledges that, to ensure that the Company retains its value and goodwill, Executive must not use any Confidential Information, special knowledge of the Business, or the Company’s relationships with its customers and employees, all of which Executive will continue to gain access to through Executive’s employment with the Company, other than in furtherance of Executive’s legitimate job duties. Executive further acknowledges that:

(a)          the Company is currently engaged in the Business;

(b)          the Business is highly competitive and the services to be performed by Executive for the Company are unique and national in nature;

(c)          Executive will continue to occupy a position of trust and confidence with the Company and has acquired and will acquire an intimate knowledge of Confidential Information and the Company’s relationships with its customers and employees;

(d)          the agreements and covenants contained in this Article IV are essential to protect the Company, the Confidential Information and the goodwill of the Company and are being entered into in consideration for the various rights being granted to Executive under this Agreement;

(e)          the Company would be irreparably damaged if Executive were to disclose the Confidential Information or provide services to any person or entity in violation of the provisions of this Agreement;

(f)          the scope and duration of the covenants set forth in this Article IV are reasonably designed to protect a protectable interest of the Company and are not excessive in light of the circumstances; and

(g)          Executive has the means to support himself and Executive’s dependents other than by engaging in activities prohibited by this Article IV.

4.3         Confidential Information.

(a)          At all times both during Executive’s employment and following the termination of Executive’s employment for any reason, Executive shall: (i) hold the Confidential Information in strictest confidence, take all reasonable precautions to prevent the inadvertent disclosure of the Confidential Information to any unauthorized person, and follow all the Company’s policies protecting the Confidential Information; (ii) not use, copy, divulge or otherwise disseminate or disclose any Confidential Information, or any portion thereof, to any unauthorized person; (iii) not make, or permit or cause to be made, copies of the Confidential Information, except as necessary to carry out Executive’s authorized duties as an employee of the Company; and (iv) promptly and fully advise the Company of all facts known to Executive concerning any actual or threatened unauthorized use or disclosure of which Executive becomes aware.

(b)          Executive hereby assigns to the Company any rights Executive may have or acquire in the Confidential Information, and recognizes that the Company shall be the sole owner of all copyrights, trade secret rights, and all other rights throughout the world (collectively, “Proprietary Rights”) in connection with such rights.

(c)          If Executive receives any subpoena or becomes subject to any legal obligation that might require Executive to disclose Confidential Information, Executive will provide prompt written notice of that fact to the Company, enclosing a copy of the subpoena and any other documents describing the legal obligation. In the event that the Company objects to the disclosure of Confidential Information, by way of a motion to quash or otherwise, Executive agrees to not disclose any Confidential Information while any such objection is pending.

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(d)          Executive understands that the Company has and will receive from third parties confidential or proprietary information (“Third Party Information”) under a duty to maintain the confidentiality of such Third Party Information and to use it only for limited purposes. During the term of Executive’s association with the Company and at all times after the termination of such association for any reason, Executive will hold Third Party Information in strict confidence and will not disclose or use any Third Party Information unless expressly authorized by the Company in advance or as may be strictly necessary to perform Executive’s obligations with the Company, subject to any agreements binding on the Company with respect to such Third Party Information.

(e)          Executive will not improperly use or disclose any confidential information or trade secrets, if any, of any former employer or of any other person to whom Executive has an obligation of confidentiality, and Executive will not bring onto the Company’s premises any unpublished documents or any property belonging to any former employer or of any other person to whom Executive has an obligation of confidentiality.

4.4         Ownership of Inventions.

(a)          Executive hereby agrees that any and all inventions (whether or not an application for protection has been filed under patent laws), works of authorship, information fixed in any tangible medium of expression (whether or not protected under copyright laws), Moral Rights, mask works, trademarks, trade names, trade dress, trade secrets, publicity rights, know-how, ideas (whether or not protected under trade secret laws), and all other subject matter protected under patent, copyright, Moral Right (defined as any right to claim authorship of a work, any right to object to any distortion or other modification of a work, and any similar right, existing under the law of any country, or under any treaty), mask work, trademark, trade secret, or other laws, that have been, are or will be developed, generated or produced by Executive, solely or jointly with others, at any time while employed by the Company, including during the Employment Term, are and shall be the exclusive property of the Company, subject to the obligations of this Article IV with respect to Confidential Information, and Executive hereby forever waives and agrees never to assert against the Company, its successors or licensees any and all ownership, interest, Moral Rights or similar rights with respect thereto. Executive hereby assigns to the Company all right, title and interest to the foregoing inventions, concepts, ideas and materials. This Section 4.4 does not apply to any invention or other work of Executive for which no equipment, supplies, facility or Confidential Information of the Company was used and that was developed entirely on Executive’s own time, unless the invention (A) relates to (x) the Business or (y) the Company’s actual or demonstrably anticipated research or development, or (B) results from any work performed by Executive for or on behalf of the Company. Executive shall keep and maintain adequate and current written records of all inventions, concepts, ideas and materials made by Executive (jointly or with others) during the term of Executive’s association or employment with the Company. Such records shall remain the property of the Company at all times. Executive shall promptly and fully disclose to the Company the nature and particulars of any Inventions or research project undertaken on the Company’s behalf.

(b)          Unless the parties otherwise agree in writing, Executive is under no obligation to incorporate any Prior Inventions in any of Company’s products or processes or other Company Invention. If, in the course of Executive’s performance, Executive chooses to incorporate into any such Company product or process or other Company Invention any Prior Invention owned by Executive or in which Executive otherwise has an interest, Executive grants the Company a non-exclusive, royalty free, irrevocable, perpetual, world-wide license to copy, reproduce, make and have made, modify and create derivative works of, use, sell and license such Prior Inventions and derivative works as part of or in connection with any such Company product or process or other Company Invention.

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(c)          During or subsequent to the Employment Term, Executive shall execute all papers, and otherwise provide assistance, at the Company’s reasonable request and expense, to enable the Company or its nominees to obtain and enforce all proprietary rights with respect to the Company Inventions (as defined below) in any and all countries. To that end, Executive will execute, verify and deliver such documents and perform such other acts (including appearances as a witness) as the Company may reasonably request for use in applying for, obtaining, perfecting, defending, evidencing and enforcing any such proprietary rights, and the assignment of any or all of such proprietary rights. In addition, Executive will execute, verify and deliver assignments of such rights to the Company or its designee. Executive’s obligation to assist the Company with respect to such rights shall continue beyond the termination of Executive’s association with the Company.

(d)          If, after reasonable effort, the Company cannot secure Executive’s signature on any document needed in connection with the actions specified in the preceding paragraph, Executive irrevocably designates and appoints the Company and its duly authorized officers and agents as Executive’s agent and attorney-in-fact, to act for and in Executive’s behalf to execute, verify and file any such documents and to do all other lawfully permitted acts to further the purposes of the preceding paragraph with the same legal force and effect as if executed by Executive. The power of attorney set forth in this Section 4.4 is coupled with an interest, is irrevocable, and shall survive Executive’s death, incompetence or incapacity and the termination of the Employment Term. Executive waives and quitclaims to the Company all claims of any nature whatsoever which Executive now has or may in the future obtain for infringement of any Proprietary Rights assigned under this Agreement or otherwise to the Company.

(e)          Executive acknowledges that all original works of authorship which are made by Executive (solely or jointly with others) during the course of the association with or performance of services for the Company and which are protectable by copyright are “works made for hire,” as that term is defined in the United States Copyright Act and any successor statutes. Inventions assigned to the Company or as directed by the Company under this Agreement or otherwise are referred to as “Company Inventions.”

4.5         Non-Solicitation.

(a)          During the Non-Solicit Restricted Period, Executive shall not (other than in furtherance of Executive’s legitimate job duties on behalf of Company), directly or indirectly, on Executive’s own behalf or for any other person or entity:

(i)          solicit for employment or hire, attempt to solicit for employment or hire, or employ or hire, any person who is or was employed by the Company at any time within six (6) months prior to the solicitation or hire (the “Restricted Personnel”);

(ii)         seek to influence any Restricted Personnel to leave the Company’s employment, engagement, or service; or

(iii)        otherwise interfere with the relationship between any Restricted Personnel and the Company.

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(b)          During the Non-Solicit Restricted Period, Executive shall not (other than in furtherance of Executive’s legitimate job duties on behalf of Company), directly or indirectly, on Executive’s own behalf or for any other person or entity:

(i)          solicit, entice or induce any customer that did business with the Company in the last two (2) years of Executive’s employment or any prospective customer of the Company (the “Restricted Customers”) to become a customer of any person or entity other than the Company with respect to products or services sold or under development by the Company as of Executive’s termination;

(ii)         sell, promote, or provide any product or services to a Restricted Customer if that product or service could otherwise be provided by the Company; or

(iii)        solicit, entice, induce, or assist any Restricted Customer to reduce or cease doing business with the Company or otherwise interfere with the relationship between any Restricted Customer and the Company.

4.6         Non-Competition; Investment Opportunities.

(a)          During the Non-Compete Restrictive Period, Executive shall not, directly or indirectly, alone or in combination with any other individual or entity, (i) own (other than through the passive ownership of less than one percent (1%) of the publicly traded shares of any entity), operate, manage, control, or participate in an executive, managerial, strategic, or sales role, in any individual or entity (other than the Company) that engages in or proposes to engage in the Business in the United States and any other country in which Executive worked for the Company (a “Competitive Business”); or (ii) otherwise render services to (as an employee, consultant, independent contractor or otherwise) a Competitive Business that are similar to the services Executive rendered to the Company, or that could involve the use of Confidential Information; and

(b)          During the Employment Term, if Executive learns of any investment opportunity in a business or any entity engaged in the Business, Executive shall present such investment opportunity to the Company.

4.7         If any court of competent jurisdiction shall deem any provision in this Article IV too restrictive, the other provisions shall stand, and the court shall modify the unduly restrictive provision to the point of greatest restriction permissible by law.

4.8         If this Agreement is terminated for any reason, Executive acknowledges and agrees that the restrictive covenants set forth in this Article IV (the “Restrictive Covenants”) shall survive the termination of this Agreement and Executive shall continue to be bound by the terms of this Article IV as if this Agreement was still in effect.

4.9         The Company and Executive agree that damages will accrue to the Company by reason of Executive’s failure to observe any of the Restrictive Covenants. Therefore, if the Company shall institute any action or proceeding to enforce such provisions, Executive waives the claim or defense that there is an adequate remedy at law and agrees in any such action or proceeding not to (i) interpose the claim or defense that such remedy exists at law, or (ii) require the Company to show that monetary damages cannot be measured or to post any bond. Without limiting any other remedies that may be available to the Company, Executive hereby specifically affirms the appropriateness of injunctive or other equitable relief in any such action. Executive also acknowledges that the remedies afforded the Company pursuant to this Section 4.9 are not exclusive, nor shall they preclude the Company from seeking or receiving any other relief, including without limitation, any form of monetary or other equitable relief. Upon the reasonable request by the Company, Executive shall provide reasonable assurances and evidence of compliance with the Restrictive Covenants.

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ARTICLE V
POST-TERMINATION OBLIGATIONS

5.1         Return of Company Materials. No later than three (3) business days following the termination of Executive’s employment for any reason, Executive shall return to the Company, and shall not retain in any form or media of expression, all Company and Affiliate property that is then in Executive’s possession, custody or control, including, without limitation, all keys, access cards, credit cards, computer hardware and software, documents, records, policies, marketing information, design information, specifications and plans, data base information and lists, and any other property or information that Executive has or had relating to the Company or any Affiliate (whether those materials are in paper or computer-stored form), and including but not limited to any documents containing, summarizing, or describing any Confidential Information.

5.2         Executive Assistance. During the Employment Term and for a reasonable period thereafter, Executive shall, upon reasonable notice, assist the Company and its subsidiaries (the “Affiliated Group”) in the defense of any claims, or potential claims that may be made or threatened to be made against any member of the Affiliated Group in any action, suit or proceeding, whether civil, criminal, administrative, investigative or otherwise (a “Proceeding”), and will assist the Affiliated Group in the prosecution of any claims that may be made by any member of the Affiliated Group in any Proceeding, to the extent that such claims may relate to Executive’s employment or the period of Executive’s employment by the Company. The Company shall reimburse Executive for all of the Executive’s reasonable out-of-pocket expenses associated with such assistance, including travel expenses and any attorneys’ fees and shall pay a reasonable per diem fee for the Executive’s service under this Section 5.2. Any services or assistance contemplated in this Section 5.2 shall be at mutually agreed to and convenient times.

ARTICLE VI
MISCELLANEOUS

6.1         Notices. Any notices, consents or other communications required or permitted to be sent or given hereunder shall be in writing and shall be deemed properly served if (i) delivered personally, in which case the date of such notice shall be the date of delivery; (ii) delivered to a nationally recognized overnight courier service, in which case the date of delivery shall be the next business day; or (iii) sent by facsimile transmission (with a copy sent by first-class mail), in which case the date of delivery shall be the date of transmission, or if after 5:00 P.M., the next business day. If not personally delivered, notice shall be sent addressed as follows: (x) if to Executive, to the address listed on the signature page hereof, and (y) if to the Company, at c/o Sterling Partners, 401 North Michigan Avenue, Suite 3300, Chicago, IL 60611, Attention: Office of General Counsel, Facsimile No. (312) 465-7100, or in either case at such other address as may hereafter be specified by notice given by either party to the other party. Executive shall promptly notify the Company of any change in his address set forth on the signature page.

6.2         Successors and Assigns. This Agreement shall be binding upon, and inure to the benefit of, and be enforceable by, the parties hereto and the Company’s successors and permitted assigns. In the case of the Company, the successors and permitted assigns hereunder shall include without limitation any Affiliate as well as the successors in interest to the Company or any such Affiliate (whether by merger, liquidation (including successive mergers or liquidations) or otherwise). This Agreement or any right or interest hereunder is one of personal service and may not be assigned by Executive under any circumstance. Nothing in this Agreement, whether expressed or implied, is intended or shall be construed to confer upon any person other than the parties and successors and assigns permitted by this Section 6.2 any right, remedy or claim under or by reason of this Agreement.

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6.3         Entire Agreement; Amendments. This Agreement, the Exhibits hereto, and the Equity Documents embody the complete agreement and understanding of the parties hereto with regard to the subject matter hereof and supersede and preempt any prior agreements, understandings, letters of intent, or representations by or among the parties, written or oral, which may have related to the subject matter hereof. This Agreement shall not be amended, modified or supplemented except by a written instrument signed by each of the parties hereto.

6.4         Interpretation. Article titles and section headings contained herein are inserted for convenience of reference only and are not intended to be a part of or to affect the meaning or interpretation of this Agreement.

6.5         Waivers. No provision of this Agreement may be waived except in a writing executed and delivered by the party against whom waiver is sought. Any such written waiver shall be effective only with respect to the event or circumstance described therein and not with respect to any other event or circumstance, unless such waiver expressly provides to the contrary.

6.6         Partial Invalidity. Wherever possible, each term and provision of this Agreement shall be interpreted so as to be effective and valid under applicable law. If any term or provision shall be held invalid or unenforceable, the remaining terms and provisions hereof not be affected thereby, unless such a construction would be unreasonable. Executive’s obligations in Articles IV and V shall survive and continue in full force notwithstanding the termination of this Agreement or Executive’s employment for any reason.

6.7         Tax Matters. Executive acknowledges that no representative or agent of Parent or the Company has provided Executive with any tax advice of any nature, and Executive has had the opportunity to consult with his own legal, tax and financial advisor(s) as to tax and related matters concerning the compensation to be received under this Agreement.

6.8         Offset. To the extent permitted by law, and to the extent that such action will not result in the imposition of additional taxes, interest or penalties pursuant to Section 409A (as defined below), the Company may offset any amounts Executive owes it pursuant to this Agreement or any other written agreement, note or other instrument relating to indebtedness for borrowed money to which Executive is a party or pursuant to any other liability or obligation by which Executive is bound against any amounts it owes Executive hereunder.

6.9         Execution in Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be considered an original instrument, but all of which shall be considered one and the same agreement.

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6.10       Required Delay for Deferred Compensation Under 409A. Notwithstanding any other provision of this Agreement, if at the time of separation from service Executive is determined by the Company to be a “specified employee” (as defined in Section 409A of the Code (together, with any state law of similar effect, “Section 409A”) and Section 1.409A-1(i) of the Treasury Regulations), and the Company determines that delayed commencement of any portion of the termination payments and benefits payable to Executive pursuant to this Agreement is required in order to avoid a prohibited distribution under Section 409A(a)(2)(B)(i) of the Code, then such portion of Executive’s termination payments and benefits shall not be provided to Executive prior to the earliest of (1) the date that is six months and one day after Executive’s separation from service, (2) the date of Executive’s death or (3) such earlier date as is permitted under Section 409A (any such delayed commencement, a “Payment Delay”). Upon the expiration of such Payment Delay, all payments deferred pursuant to a Payment Delay shall be paid in a lump sum to Executive on the first day following the expiration of the Payment Delay, and any remaining payments due under the Agreement shall be paid on the original schedule provided herein.

This Agreement is intended to meet the requirements of Section 409A, and shall be interpreted and construed consistent with that intent. References to termination of employment, retirement, separation from service and similar or correlative terms in this Agreement shall mean a “separation from service” (as defined at Section 1.409A-1(h) of the Treasury Regulations) from the Company and from all other corporations and trades or businesses, if any, that would be treated as a single “service recipient” with the Company under Section 1.409A-1(h)(3) of the Treasury Regulations. Each installment of the payments and benefits provided for in this Agreement shall be treated as a separate “payment” for purposes of Treasury Regulation Section 1.409A-2(b)(2)(i).

6.11       Governing Law; Consent to Jurisdiction; Waiver of Jury. This Agreement shall be governed by and construed in accordance with the internal laws of the State of Georgia, without regard to its conflict of law principles. For the purposes of any suit, action, or other proceeding arising out of this Agreement or with respect to Executive’s employment hereunder, the Parties hereto: (i) agree to submit to the exclusive jurisdiction of the federal or state courts located in Fulton County, State of Georgia, (ii) agree to unconditionally waive any objection to venue in such jurisdiction, and agree not to plead or claim forum non conveniens, and (iii) to waive their respective rights to a jury trial of any and such claims and causes of action.

6.12       Construction. The language used in this Agreement will be deemed to be the language chosen by Executive and the Company to express their mutual intent, and no rule of strict construction will be applied against Executive or the Company.

*          *          *

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IN WITNESS WHEREOF, the Company has caused this Employment Agreement to be duly executed by an officer thereunto duly authorized, and Executive has hereunto set his hand, all as of the day and year first above written.

THE COMPANY:
INNOTRAC CORPORATION
By:	/s/ Scott Dorfman
	Name:	Scott Dorfman
	Title:	Chief Executive Officer
EXECUTIVE:
/s/ Steve Keaveney
Name: Steve Keaveney
Address:		[REDACTED]
		[REDACTED]
Phone:		[REDACTED]
Fax:		[REDACTED]

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Exhibit A

Form of Release

THIS RELEASE (the “Release”) is entered into between Steve Keaveney (“Executive”) and Innotrac Corporation, a Georgia corporation (the “Company”), for the benefit of the Company. The entering into and non-revocation of this Release is a condition to Executive’s right to receive the payments under Section 3.2 of the Employment Agreement entered into by and between Executive and the Company, dated as of November 14, 2013 (the “Employment Agreement”). Capitalized terms used and not defined herein shall have the meaning provided in the Employment Agreement.

Accordingly, Executive and the Company agree as follows.

1.          In consideration for the payments and other benefits provided to Executive under Section 3.2(a) of the Employment Agreement, Executive represents and agrees, as follows:

(a)          Executive, for himself, his heirs, administrators, representatives, executors, successors and assigns (collectively “Releasers”), hereby irrevocably and unconditionally releases, acquits and forever discharges and agrees not to sue the Company or any of its parents, subsidiaries, divisions, affiliates and related entities and its current and former directors, officers, shareholders, trustees, employees, consultants, independent contractors, representatives, agents, servants, successors and assigns and all persons acting by, through or under or in concert with any of them (collectively “Releasees”), from all claims, rights and liabilities up to and including the date of this Release arising from or relating to Executive’s employment with, or termination of employment from, the Company, under the Employment Agreement and from any and all charges, complaints, claims, liabilities, obligations, promises, agreements, controversies, damages, actions, causes of actions, suits, rights, demands, costs, losses, debts and expenses of any nature whatsoever, known or unknown, suspected or unsuspected and any claims of wrongful discharge, breach of contract, implied contract, promissory estoppel, defamation, slander, libel, tortious conduct, employment discrimination or claims under any federal, state or local employment statute, law, order or ordinance, including any rights or claims arising under Title VII of the Civil Rights Act of 1964, as amended, the Age Discrimination in Employment Act of 1967, as amended, 29 U.S.C. § 621 et seq. (“ADEA”), or any other federal, state or municipal ordinance relating to discrimination in employment. Nothing contained herein shall restrict the parties’ rights to enforce the terms of this Release.

(b)          To the maximum extent permitted by law, Executive agrees that he has not filed, nor will he ever file, a lawsuit asserting any claims which are released by this Release.

(c)          This Release specifically excludes Executive’s rights and the Company’s obligations under Sections 3.2 and 6.14 of the Employment Agreement, the Benefit Plans, and the Equity Documents. Executive’s entitlement to vested benefits under the Benefit Plans and the Equity Documents shall be determined in accordance with the provisions of the Benefit Plans or Equity Documents, as the case may be. Nothing contained in this Release shall release Executive from his obligations, including any obligations to abide by restrictive covenants, under the Employment Agreement, the Equity Documents or the Benefit Plans that continue or are to be performed following termination of employment.

(d)          The parties agree that this Release shall not affect the rights and responsibilities of the US Equal Employment Opportunity Commission (hereinafter “EEOC”) to enforce ADEA and other laws. In addition, the parties agree that this Release shall not be used to justify interfering with Executive’s protected right to file a charge or participate in an investigation or proceeding conducted by the EEOC. The parties further agree that Executive knowingly and voluntarily waives all rights or claims (that arose prior to Executive’s execution of this Release) the Releasers may have against the Releasees, or any of them, to receive any benefit or remedial relief (including, but not limited to, reinstatement, back pay, front pay, damages, attorneys’ fees, experts’ fees) as a consequence of any investigation or proceeding conducted by the EEOC.

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2.          Executive acknowledges that the Company has specifically advised him of the right to seek the advice of an attorney concerning the terms and conditions of this Release. Executive further acknowledges that he has been furnished with a copy of this Release, and he has been afforded twenty-one (21) days in which to consider the terms and conditions set forth above prior to this Release. By executing this Release, Executive affirmatively states that he has had sufficient and reasonable time to review this Release and to consult with an attorney concerning his legal rights prior to the final execution of this Release. Executive further agrees that he has carefully read this Release and fully understands its terms. Executive understands that he may revoke this Release within seven (7) days after signing this Release. Revocation of this Release must be made in writing and must be received by [●] at [●] within the time period set forth above.

3.          This Release will be governed by and construed in accordance with the laws of the state of Georgia, without giving effect to any choice of law or conflicting provision or rule (whether of the state of Georgia or any other jurisdiction) that would cause the laws of any jurisdiction other than the state of Georgia to be applied. In furtherance of the foregoing, the internal law of the state of Georgia will control the interpretation and construction of this agreement, even if under such jurisdiction’s choice of law or conflict of law analysis, the substantive law of some other jurisdiction would ordinarily apply. The provisions of this Release are severable, and if any part or portion of it is found to be unenforceable, the other paragraphs shall remain fully valid and enforceable. This Release shall become effective and enforceable on the eighth day following its execution by Executive, provided he does not exercise his right of revocation as described above. If Executive fails to sign and deliver this Release or revokes his signature, this Release will be without force or effect, and Executive shall not be entitled to the payment under Section 3.2 of the Employment Agreement.

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Exhibit B

Prior Inventions

None.

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EX-10.8

Exhibit 10.8

EMPLOYMENT AGREEMENT

This EMPLOYMENT AGREEMENT (the “Agreement”) is made as of November 14, 2013 (but effective as of the Commencement Date, as defined below), by and between Innotrac Corporation, a Georgia corporation (the “Company”), and Ed Ringer (“Executive”).

RECITALS

A.          Immediately following the execution and delivery of this Agreement, the Company, Blue Eagle Holdings, L.P., a Delaware limited partnership (“Parent”), and Blue Eagle Acquisition Sub, Inc., a Georgia corporation and wholly owned subsidiary of Parent (“Purchaser”), will enter into that certain Agreement and Plan of Merger, dated as of the date hereof (the “Merger Agreement”).

B.           On the terms and subject to the conditions set forth in the Merger Agreement, (i) Purchaser will commence a tender offer to purchase (the “Offer”) all of the issued and outstanding shares of common stock of the Company, par value $0.10 per share (the “Common Stock”), at an offer price equal to the Offer Price (as defined in the Merger Agreement) payable to the seller in cash, without interest, subject to withholding of taxes required by applicable Law and (ii) following the consummation of the Offer and at the Effective Time (as defined in the Merger Agreement), Purchaser will merge with and into the Company (the “Merger”), with the Company continuing as the surviving corporation, whereby each issued and outstanding share of Common Stock (other than Excluded Shares (as defined in the Merger Agreement)) will be converted into the right to receive the Common Merger Consideration (as defined in the Merger Agreement) payable to the seller in cash, without interest, subject to withholding of taxes required by applicable Law.

C.           Simultaneous with the execution and delivery of this Agreement, the Company is entering into employment agreements (the “Other Employment Agreements”) with certain other executives of the Company (the “Other Executives”).

D.           As a condition and inducement to Parent and Purchaser entering into and incurring their respective obligations under the Merger Agreement, Executive and the Company have agreed to enter into this Agreement.

NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth below, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Company and Executive agree as follows:

ARTICLE I
EMPLOYMENT SERVICES

1.1         Term of Employment.  Executive’s employment under this Agreement shall commence and be effective at the Effective Time (the “Commencement Date”) and continue until terminated pursuant to Article III below (the “Employment Term”). This Agreement shall terminate automatically and will be of no force or effect upon any termination of the Merger Agreement in accordance with its terms prior to the occurrence of the Effective Time.

1.2         Title and Position.   During the Employment Term, Executive shall hold the position of Chief Information Officer of the Company, and shall report directly to the Chief Executive Officer of the Company. Executive’s responsibilities shall include such duties as are commensurate with Executive’s position and as may be assigned to Executive in good faith by the Board of Directors of the Company (the “Board”) or the Chief Executive Officer.

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1.3         Activities and Duties During Employment.

(a)          Executive shall conduct himself, both professionally and personally, with due regard to public conventions and morals, and in a manner that will not have a materially adverse effect on the reputation of the Company or Executive. Executive shall devote Executive’s full business time, attention, skill and energy to the business and affairs of the Company and its subsidiaries, and shall use Executive’s reasonable best efforts to faithfully perform Executive’s responsibilities in a diligent, trustworthy, efficient and businesslike manner so as to advance the best interests of the Company. Notwithstanding the foregoing, Executive shall be permitted to devote a reasonable amount of time and effort to (i) serving on governing boards of or otherwise assisting civic and charitable organizations, and (ii) investing and managing personal and family investments, but only to the extent that activities described in clauses (i) or (ii), individually or as a whole, do not (A) involve Executive’s active participation in the management of any corporation, partnership or other business entity, (B) involve an ownership interest in any customer or vendor of the Company unless approved in advance by written resolution of the Board, (C) interfere with the Executive’s duties to the Company in any material respect, or (D) otherwise violate any provision of this Agreement in any material respect. Executive shall not have any ownership interest in any customer or vendor of Parent the Company or any of their subsidiaries unless approved in advance by written resolution of the Board.

(b)          Executive shall comply in all material respects with all applicable laws, and all written policies, rules and regulations of the Company, including without limitation codes of conduct and any charter of the Board or any compensation committee of the Board (the “Committee”), as applicable.

ARTICLE II
COMPENSATION

2.1         Base Salary.   During the Employment Term, Executive shall receive an initial annual base salary of $215,000 (“Base Salary”), less applicable withholdings, payable in accordance with the general payroll practices of the Company(but no less infrequently than in equal monthly installments). The Base Salary will be reviewed by the Board or the Committee or its designee at least annually for increase (but not for decrease, except to the extent permitted under Section 3.2(c)(iii)(3)). As so adjusted, the Base Salary shall thereafter be Executive’s “Base Salary” for all purposes under this Agreement.

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2.2         Incentive Bonus.

(a)          The Company shall establish a performance-based bonus plan (the “Plan”) pursuant to which Executive shall be eligible to receive an annual incentive bonus (the “Annual Bonus”) with respect to each fiscal year of Company (“Fiscal Year”) ending during the Employment Term, subject to the achievement of financial performance objectives and “management by objective” goals as previously established by the Board in consultation with the Chief Executive Officer, which objectives shall be reasonably related to the Company’s business objectives. The Board or the Committee shall administer the Plan, and shall have the sole discretion to determine if the goals have been attained and what percentage of Base Salary, if any, will be paid as an Annual Bonus; provided any such determinations are made reasonably and in good faith. To the extent the goals are financial in nature, the Board shall base its determination on the audit, review or compilation of the Company’s financial results submitted by the Company’s independent accountants, which determination shall be made within thirty (30) days of receipt by the Company of such audit, review or compilation (the date on which the Committee makes such determination, the “Bonus Determination Date”). Executive acknowledges that (i) no Annual Bonus shall be earned or accrued until the corresponding Bonus Determination Date and (ii) in order to receive an Annual Bonus with respect to a Fiscal Year, Executive must remain continuously employed by the Company through and including the first day of the Fiscal Year following the Fiscal Year to which such Annual Bonus relates and provided that Executive’s employment with the Company is not terminated by the Company for Cause prior to the Bonus Determination Date. The Annual Bonus shall be paid as soon as practicable after the Bonus Determination Date, but in no event later than December 31 of the Fiscal Year following the Fiscal Year for which the Annual Bonus relates. With respect to the Company’s 2013 Fiscal Year, Executive will be entitled to a Bonus under the Company’s 2013 Executive Bonus Plan (the “2013 Bonus”), which shall be paid as soon as practicable after the thirtieth (30^th) day following receipt by the Board of the Company’s audit for the 2013 Fiscal Year, but in no event later than December 31, 2014. Executive acknowledges that (x) the 2013 Bonus shall not be earned or accrued until the thirtieth (30^th) day following receipt by the Board of the Company’s audit for the 2013 Fiscal Year (the “2013 Bonus Determination Date”) and (y) in order to receive the 2013 Bonus, Executive must remain continuously employed by the Company through and including the first day of the Fiscal Year following the 2013 Fiscal Year and provided that Executive’s employment with the Company is not terminated by the Company for Cause prior to the 2013 Bonus Determination Date.

(b)          Should the Board determine that an Annual Bonus to Executive was based on an audit, review or compilation that is later found to be materially misstated or inaccurate in any material respect, the Board shall have the right to require Executive to remit to the Company any excess bonus amount paid as a result of such materially misstated or inaccurate audit, review or compilation (an “Excess Bonus Amount”). Executive shall remit the Excess Bonus Amount to the Company within 30 days after receiving written notice (an “Excess Bonus Notice”) from the Board describing the reason for overpayment and the Excess Bonus Amount due from Executive. Notwithstanding the foregoing, if an Excess Bonus Notice is first given at any time after the second anniversary of the date on which the corresponding Excess Bonus Amount was paid to Executive by the Company, and the determination of such Excess Bonus Amount does not, in any respect, relate to, or arise from, any acts or omissions in financial reporting or accounting practices that occurred at the direction, or with the knowledge, of Executive, then the Company’s right to recover such Excess Bonus Amount thereafter shall only be accomplished through the exercise of its right of offset in Section 6.8 (and subject to the limitations therein).

2.3         Reimbursement of Expenses.  The Company shall reimburse Executive for all reasonable expenses incurred by Executive while performing Executive’s duties under this Agreement, subject to the Company’s policies in effect from time to time and corroborating documentation reasonably satisfactory to the Company.

2.4         Health Care and Benefit Plans.   During the Employment Term, Executive shall be eligible to receive all fringe benefits and perquisites and entitled to participate in all incentive, savings and retirement plans, practices, policies and programs applicable generally to other senior-level executives of the Company and shall be eligible for participation in, and shall receive all benefits under, any health or welfare benefit plans, practices, policies and programs provided by the Company normally available to other senior-level executives of the Company (subject to all applicable eligibility and contribution policies and rules), as may be in effect from time to time, including such insurance programs as may be implemented by the Company (“Benefit Plans”).

2.5         Key Man Insurance.   Executive shall make application for, and submit to such examinations as may reasonably be requested by the Board in order to obtain key man or other insurance on the life of Executive for the benefit of the Company as the Board shall direct, the cost of which insurance shall be borne by the Company.

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2.6         Vacation.  Executive shall receive four (4) weeks of paid vacation days per calendar year, to accrue pro rata on a monthly basis and to be administered in accordance with the Company’s policies and procedures (provided, however, that such policies shall not enhance Executive’s number of vacation days or otherwise conflict with this Section 2.6). Such vacation may be taken, in Executive’s discretion, subject to the reasonable business needs of the Company. Vacation time may not be carried over from one calendar year to the next, but rather must be used in the calendar year in which it is earned.

2.7         Awards Pursuant Parent’s Equity Incentive Plan.   Executive and the Company acknowledge that on the Commencement Date, Parent shall grant Executive options to acquire the number of Common Units equal to one-half of one percent (0.5%) of the fully-diluted equity of Parent pursuant to the terms and subject to the conditions set forth in the Blue Eagle Equity Incentive Plan (the “Incentive Plan”) and Award Agreement thereunder (“Award Agreement,” together with the Incentive Plan, the “Plan Documents”).

2.8         Amended and Restated Limited Partnership Agreement.  All equity of Parent acquired by Executive pursuant to the Plan Documents shall be subject to the terms and conditions of the Amended and Restated Limited Partnership Agreement of Parent (the “Partnership Agreement”, collectively with the Plan Documents, the “Equity Documents”).

ARTICLE III
TERMINATION OF EMPLOYMENT

3.1         Employment At Will.  Executive’s employment by the Company is at-will, and either Executive or the Company may terminate Executive’s employment with the Company (the effective date of separation being the “Termination Date”), subject to the following:

(a)          The Company may terminate Executive’s employment at any time with Cause by giving written notice of such termination to Executive designating an immediate or future termination date.

(b)          Executive may terminate Executive’s employment for Good Reason or without Good Reason by giving the Company thirty (30) days prior written notice of termination. Upon such notice, the Company may, at its option, (i) make Executive’s termination effective immediately, (ii) require Executive to continue to perform Executive’s duties hereunder during such 30-day period, with or without restrictions on Executive’s activities, and/or (iii) accept Executive’s notice of termination as Executive’s resignation from the Company at any time during such 30-day period on behalf of the Company. If the Company elects (i) above, the Company shall have no obligation to provide Executive any compensation or benefits beyond the Termination Date except for payment of Executive’s Base Salary under Section 2.1 and benefits under Section 2.4 that have accrued through the Termination Date, any severance payments or benefits under Section 3.2, or as otherwise required by law. If the Company elects (ii) or (iii) above, the Company shall pay Executive’s Base Salary under Section 2.1 and benefits under Section 2.4 through the date on which Executive voluntarily ceases to perform services for the Company, in addition to payment of any severance payments or benefits to Executive under Section 3.2.

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(c)          Executive’s employment will terminate immediately without any notice upon Executive’s death. If the Company determines in good faith that Executive is Disabled or Incapacitated during the Employment Term (pursuant to the definition of Disabled or Incapacitated set forth below), the Company may give Executive written notice in accordance with Section 3(d) of its intention to terminate Executive’s employment. In such event, Executive’s employment with the Company shall terminate effective on the 30^th day after receipt of such notice by Executive (the “Disability Effective Date”); provided that within the 30-day period after such receipt, Executive shall not have returned to full time performance of Executive’s duties. For purposes of this Agreement, “Disabled or Incapacitated” means Executive’s inability or failure, due to a medically determinable physical or mental impairment, to substantially perform the essential functions of Executive’s job, with or without a reasonable accommodation, for thirty (30) consecutive calendar days or for ninety (90) calendar days during any twelve (12)-month period irrespective of whether such days are consecutive. Whether Executive is “Disabled or Incapacitated” shall be determined by a physician selected by the Company or its insurers, which physician is reasonably acceptable to Executive. Upon request, Executive shall provide the Board with documentation from Executive’s health care provider sufficient for the Board to determine the nature and extent of any physical or mental impairment that may interfere with Executive’s performance of Executive’s job duties, as well as any accommodations that could be made. If Executive’s employment is terminated pursuant to this Section 3.1(c), the Company shall have no obligation to provide Executive any compensation or benefits beyond the Termination Date except for payment of Executive’s Base Salary under Section 2.1 and benefits under Section 2.4 that have accrued through the Termination Date or as otherwise required by law.

(d)          Any termination by the Company for Cause or without Cause, or by Executive for Good Reason or without Good Reason, shall be communicated by Notice of Termination to the other party hereto given in accordance with Section 6.1 of this Agreement. For purposes of this Agreement, a “Notice of Termination” means a written notice which (i) indicates the specific termination provision in this Agreement relied upon, (ii) to the extent applicable, sets forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of Executive’s employment under the provision so indicated and (iii) if the Termination Date is other than the date of receipt of such notice, specifies the termination date. The failure by Executive or the Company to set forth in the Notice of Termination any fact or circumstance which contributes to a showing of Good Reason or Cause shall not waive any right of Executive or the Company hereunder or preclude Executive or Company from asserting such fact or circumstance in enforcing Executive’s or Company’s rights hereunder.

(e)          The “Termination Date” means (i) if Executive’s employment is terminated by Company for Cause or by Executive for Good Reason, the date of receipt of the Notice of Termination or any later date specified therein pursuant to Section 3(d), or as provided in Section 3.1(b), as the case may be, (ii) if Executive’s employment is terminated by the Company without Cause or by Executive without Good Reason, the effective date of separation, (iii) if Executive’s employment is terminated by reason of Disability, the Disability Effective Date, and (iv) if Executive’s employment is terminated by reason of death, the date of death.

3.2         Company Obligations Upon Termination.

(a)          If the Company terminates Executive’s employment without Cause or Executive terminates his employment for Good Reason, then the Company will provide Executive with the following severance payments and/or benefits:

(i)          Prior to the thirtieth day following the Termination Date, the Company shall pay to Executive in a lump sum, to the extent not previously paid, (x) the Base Salary through the Termination Date and (y) the Annual Bonus earned for any Fiscal Year ended prior to the year in which the Termination Date occurs, provided that Executive was employed on the last day of such Fiscal Year (the “Accrued Obligations”);

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(ii)         Starting as of the next applicable Company payroll date after the Termination Date (provided Executive has complied with Section 3.2(b)), the Company will pay Executive a monthly amount equal to the (x) Base Salary, divided by (y) 12 (the “Cash Severance”), until the end of the sixth (6^th) month following the Termination Date (the “Severance Period”); and

(iii)        During the Severance Period, the Company shall continue the health and welfare benefits to Executive and, where applicable, Executive’s dependents on the same terms that would have been provided to them had Executive continued employment with Company in accordance with the health and welfare benefits provided pursuant to Section 2.4.

(b)          The obligations of the Company to make payments under Section 3.2(a) (other than the Accrued Obligations) are conditioned on Executive executing and delivering a general release of claims against the Company, its Affiliates, and each of their respective officers, directors, members, managers, partners and shareholders with respect to Executive’s employment, in substantially the form attached hereto as Exhibit B (the “Release”). If (i) the Board reasonably and in good faith believes that Executive has breached in any material respect any of Executive’s obligations in Article IV or (ii) Executive’s agrees to become employed by or to provide services to any entity that is an Affiliate of Sterling Fund Management, LLC, then the Board may unilaterally suspend Executive’s right to receive any Cash Severance then or thereafter due from Company to Executive, provided that in the case of clause (i), the Board (A) gives Executive advance written notice of such suspension and (B) initiates an action or claim to enforce Company’s rights in respect of such restrictive covenants promptly after such suspension. In the event that Company prevails on such action or claim, Executive’s right to receive, and Company’s obligation to pay, any additional Cash Severance, including any previously suspended amounts, shall be terminated immediately, and Executive shall have no further rights to Cash Severance. In the event that Executive prevails on such action or claim, Company shall be required to pay to Executive in a lump sum within thirty (30) days of such adjudication any Cash Severance the payment of which was delayed due to such suspension, plus interest for any period during which the payment of the Cash Severance was suspended at the prime rate, as published in the Wall Street Journal on the date of such suspension, and to commence payment of future installments of Cash Severance in accordance with Section 3.2(a)(ii) plus legal fees of Executive required in the defense.

(c)          For purposes of this Agreement:

(i)          The term “Affiliate” means, with respect to Parent: (A) any other entity or person owning 10% or more of the voting or beneficial interests of Parent; (B) the Company and any other entity or person directly or indirectly controlling, controlled by or under common control with Parent; or (C) any other entity in which more than 10% of the voting or beneficial interests are owned by one or more persons or entities who have a relationship with Parent described in clauses (A) or (B); provided that, for the purposes of this definition, “control” (including, with correlative meanings, the terms “controlled by” and “under common control with”), as used with respect to any person or entity, shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of such person or entity, whether through the ownership of voting securities, by contract or otherwise.

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(ii)         The term “Cause” means that Executive has: (A) engaged in (1) a material act of dishonesty involving the Company or its Affiliates, (2) malfeasance or gross negligence which is injurious to the Company, or (3) a material breach of his fiduciary duties related to employment; (B) committed an act of fraud or embezzlement, (C) committed any crime of moral turpitude or any felony; (D) repeatedly refused to perform specific reasonable directives from the Board or any officer of the Company to whom Executive reports that are reasonably consistent with the scope and nature of Executive’s responsibilities (other than such failure resulting from his disability or incapacity); (E) used or been under the influence of illegal drugs at the workplace or while performing Company business, or refused to submit for a drug test upon the Company’s reasonable request; (F) breached any provision of Article IV in any material respect; (G) failed to obtain the Board’s consent prior to causing the Company or any of its subsidiaries to engage in any business with any family members, their Affiliates or any entities they work with after the Commencement Date; (H) caused, directed or permitted Parent, the Company or any of their subsidiaries to grant incentive equity to any person on terms and conditions not specifically approved by the Board or the Committee, or caused, directed or permitted the Company to pay bonuses or grant raises to employees or other service providers of the Company in amounts materially in excess of the ranges contemplated by the Company’s budget, as approved by the Board, or in contravention of the Committee’s charter; (I) willfully breached Executive’s other duties and obligations in Section 1.3 or any other written agreement between Executive and Parent or the Company in any material respect, or willfully took or failed to take any action in contravention of the Board charters in any material respect; or (J) willfully violated any conflict of interest policy of the Company or the Board in any material respect. A termination will not be for “Cause” pursuant to clauses (A)(3), (D), (G), (H), or (I), to the extent such conduct is curable, unless Company shall have notified Executive in writing describing such conduct and prescribing conduct required to cure such conduct and Executive shall have failed to cure such conduct within ten (10) business days after his receipt of such written notice. For purposes of this definition of Cause, no act or failure to act on the part of Executive shall be considered willful if it is done, or omitted to be done, by Executive in good faith and with a good faith belief that Executive’s act or omission was in the best interests of Company or the Parent. Subject to the foregoing, (x) the decision to terminate Executive’s employment for Cause, to take other action or to take no action in response to any occurrence shall be in the sole and exclusive discretion of the Board, and (y) Executive’s employment by the Company also shall be deemed terminated for Cause if Executive resigns from the Company and the Board determines in good faith that one or more of the events described above existed as of the time of such resignation.

(iii)        “Good Reason” means a resignation by Executive occasioned by any of the following events or conditions: (1) a relocation of the principal place of performance of Executive’s duties to a location more than fifty (50) miles from the Company’s principal office in Atlanta, Georgia (unless such new principal place of performance is within fifty (50) miles from the Executive’s then-permanent residence); (2) a material reduction in Executive’s authority, duties or responsibilities (including reporting responsibilities) without Executive’s prior written consent; (3) a material reduction in Executive’s Base Salary, unless such reduction in base salary is based on a Company action affecting all executive employees of the Company and the percentage reduction of Executive’s base salary is no greater than that applied to any other executive employee of the Company; (4) a material breach of this Agreement by the Company that has a material adverse effect on Executive; or (5) a failure by the Company to pay Executive any material portion of the Base Salary, bonus or other benefits owed to Executive; provided, however, that in order for any event or condition described in clauses (1) through (5) above to constitute Good Reason hereunder, Executive must:

(A)         give the Company written notice within ten (10) days after Executive first has actual knowledge of the event or condition, which written notice identifies the event or condition and explains why Executive believes that it constitutes Good Reason; and

(B)         (1) provide the Company twenty (20) days from the date of service of the notice described in sub-clause (A) above to cure such event or condition(to the extent such conduct is curable), and (2) terminate Executive’s employment only if such event or condition remains, to the reasonable satisfaction of Executive, uncured by the Company as of the end of such 20-day period.

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ARTICLE IV
RESTRICTIVE COVENANTS

4.1          Definitions.  For purposes of this Article IV:

(a)          the term “Business” means (i) the business of providing fulfillment services, order processing, call centers, customer care services, including e-commerce fulfillment or e-commerce return services, related software platform and application services and similar and related services that the Company or any of its subsidiaries are engaged in during the Employment Term and (ii) any other business that the Company or any of its subsidiaries has taken affirmative steps towards engaging in on or prior to the Termination Date;

(b)          the term “Confidential Information” shall mean any non-public information, in whatever form or medium, concerning the operations or affairs of the Business, including, but not limited to, (i) sales, sales volume, sales methods, sales proposals, business plans, advertising and marketing plans, strategic and long-range plans, and any information related to any of the foregoing, (ii) customers, customer lists, prospective customers and customer records, (iii) general price lists and prices charged to specific customers, (iv) trade secrets, (v) financial statements, budgets and projections, (vi) software owned or developed (or being developed) for use in or relating to the conduct of the Business, (vii) the names, addresses and other contact information of all vendors and suppliers and prospective vendors and suppliers of the Business, and (viii) all other confidential or proprietary information belonging to the Company or relating to the Business; provided, however, that Confidential Information shall not include (1) knowledge, data and information that is generally known or becomes known in the trade or industry of the Company (other than as a result of a breach of this Agreement or other agreement or instrument to which Executive is bound), and (2) knowledge, data and information gained without a breach of this Agreement on a non-confidential basis from a person who is not legally prohibited from transmitting the information to Executive;

(c)          the term “Company” shall be deemed to include Parent, the Company and all of their subsidiaries;

(d)          the term “Non-Compete Restricted Period” shall mean the period commencing on the Commencement Date and terminating twelve (12) months following the termination of Executive’s employment or engagement with the Company;

(e)           the term “Non-Solicit Restricted Period” shall mean the period commencing on the Commencement Date and terminating twenty-four (24) months following the termination of Executive’s employment or engagement with the Company; and

(f)           the term “Prior Inventions” shall mean all inventions, original works of authorship, developments and improvements which were made by Executive, alone or jointly with others, prior to Executive’s employment, association or other engagement with the Company. To preclude any possibility of uncertainty, Executive has set forth on Exhibit B attached hereto a complete list of all Prior Inventions which Executive considers to be Executive’s property or the property of third parties and which Executive wishes to have excluded from the scope of this Agreement. If disclosure of any such Prior Invention on Exhibit B would cause Executive to violate any prior confidentiality agreement, Executive understands that Executive is not to list such Prior Invention in Exhibit B but is to inform the Company that all Prior Inventions have not been listed for that reason.

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4.2          Executive Acknowledgement.   Executive agrees and acknowledges that, to ensure that the Company retains its value and goodwill, Executive must not use any Confidential Information, special knowledge of the Business, or the Company’s relationships with its customers and employees, all of which Executive will continue to gain access to through Executive’s employment with the Company, other than in furtherance of Executive’s legitimate job duties. Executive further acknowledges that:

(a)          the Company is currently engaged in the Business;

(b)          the Business is highly competitive and the services to be performed by Executive for the Company are unique and national in nature;

(c)          Executive will continue to occupy a position of trust and confidence with the Company and has acquired and will acquire an intimate knowledge of Confidential Information and the Company’s relationships with its customers and employees;

(d)          the agreements and covenants contained in this Article IV are essential to protect the Company, the Confidential Information and the goodwill of the Company and are being entered into in consideration for the various rights being granted to Executive under this Agreement;

(e)           the Company would be irreparably damaged if Executive were to disclose the Confidential Information or provide services to any person or entity in violation of the provisions of this Agreement;

(f)           the scope and duration of the covenants set forth in this Article IV are reasonably designed to protect a protectable interest of the Company and are not excessive in light of the circumstances; and

(g)           Executive has the means to support himself and Executive’s dependents other than by engaging in activities prohibited by this Article IV.

4.3          Confidential Information.

(a)          At all times both during Executive’s employment and following the termination of Executive’s employment for any reason, Executive shall: (i) hold the Confidential Information in strictest confidence, take all reasonable precautions to prevent the inadvertent disclosure of the Confidential Information to any unauthorized person, and follow all the Company’s policies protecting the Confidential Information; (ii) not use, copy, divulge or otherwise disseminate or disclose any Confidential Information, or any portion thereof, to any unauthorized person; (iii) not make, or permit or cause to be made, copies of the Confidential Information, except as necessary to carry out Executive’s authorized duties as an employee of the Company; and (iv) promptly and fully advise the Company of all facts known to Executive concerning any actual or threatened unauthorized use or disclosure of which Executive becomes aware.

(b)          Executive hereby assigns to the Company any rights Executive may have or acquire in the Confidential Information, and recognizes that the Company shall be the sole owner of all copyrights, trade secret rights, and all other rights throughout the world (collectively, “Proprietary Rights”) in connection with such rights.

(c)          If Executive receives any subpoena or becomes subject to any legal obligation that might require Executive to disclose Confidential Information, Executive will provide prompt written notice of that fact to the Company, enclosing a copy of the subpoena and any other documents describing the legal obligation. In the event that the Company objects to the disclosure of Confidential Information, by way of a motion to quash or otherwise, Executive agrees to not disclose any Confidential Information while any such objection is pending.

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(d)          Executive understands that the Company has and will receive from third parties confidential or proprietary information (“Third Party Information”) under a duty to maintain the confidentiality of such Third Party Information and to use it only for limited purposes. During the term of Executive’s association with the Company and at all times after the termination of such association for any reason, Executive will hold Third Party Information in strict confidence and will not disclose or use any Third Party Information unless expressly authorized by the Company in advance or as may be strictly necessary to perform Executive’s obligations with the Company, subject to any agreements binding on the Company with respect to such Third Party Information.

(e)          Executive will not improperly use or disclose any confidential information or trade secrets, if any, of any former employer or of any other person to whom Executive has an obligation of confidentiality, and Executive will not bring onto the Company’s premises any unpublished documents or any property belonging to any former employer or of any other person to whom Executive has an obligation of confidentiality.

4.4          Ownership of Inventions.

(a)          Executive hereby agrees that any and all inventions (whether or not an application for protection has been filed under patent laws), works of authorship, information fixed in any tangible medium of expression (whether or not protected under copyright laws), Moral Rights, mask works, trademarks, trade names, trade dress, trade secrets, publicity rights, know-how, ideas (whether or not protected under trade secret laws), and all other subject matter protected under patent, copyright, Moral Right (defined as any right to claim authorship of a work, any right to object to any distortion or other modification of a work, and any similar right, existing under the law of any country, or under any treaty), mask work, trademark, trade secret, or other laws, that have been, are or will be developed, generated or produced by Executive, solely or jointly with others, at any time while employed by the Company, including during the Employment Term, are and shall be the exclusive property of the Company, subject to the obligations of this Article IV with respect to Confidential Information, and Executive hereby forever waives and agrees never to assert against the Company, its successors or licensees any and all ownership, interest, Moral Rights or similar rights with respect thereto. Executive hereby assigns to the Company all right, title and interest to the foregoing inventions, concepts, ideas and materials. This Section 4.4 does not apply to any invention or other work of Executive for which no equipment, supplies, facility or Confidential Information of the Company was used and that was developed entirely on Executive’s own time, unless the invention (A) relates to (x) the Business or (y) the Company’s actual or demonstrably anticipated research or development, or (B) results from any work performed by Executive for or on behalf of the Company. Executive shall keep and maintain adequate and current written records of all inventions, concepts, ideas and materials made by Executive (jointly or with others) during the term of Executive’s association or employment with the Company. Such records shall remain the property of the Company at all times. Executive shall promptly and fully disclose to the Company the nature and particulars of any Inventions or research project undertaken on the Company’s behalf.

(b)          Unless the parties otherwise agree in writing, Executive is under no obligation to incorporate any Prior Inventions in any of Company’s products or processes or other Company Invention. If, in the course of Executive’s performance, Executive chooses to incorporate into any such Company product or process or other Company Invention any Prior Invention owned by Executive or in which Executive otherwise has an interest, Executive grants the Company a non-exclusive, royalty free, irrevocable, perpetual, world-wide license to copy, reproduce, make and have made, modify and create derivative works of, use, sell and license such Prior Inventions and derivative works as part of or in connection with any such Company product or process or other Company Invention.

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(c)          During or subsequent to the Employment Term, Executive shall execute all papers, and otherwise provide assistance, at the Company’s reasonable request and expense, to enable the Company or its nominees to obtain and enforce all proprietary rights with respect to the Company Inventions (as defined below) in any and all countries. To that end, Executive will execute, verify and deliver such documents and perform such other acts (including appearances as a witness) as the Company may reasonably request for use in applying for, obtaining, perfecting, defending, evidencing and enforcing any such proprietary rights, and the assignment of any or all of such proprietary rights. In addition, Executive will execute, verify and deliver assignments of such rights to the Company or its designee. Executive’s obligation to assist the Company with respect to such rights shall continue beyond the termination of Executive’s association with the Company.

(d)          If, after reasonable effort, the Company cannot secure Executive’s signature on any document needed in connection with the actions specified in the preceding paragraph, Executive irrevocably designates and appoints the Company and its duly authorized officers and agents as Executive’s agent and attorney-in-fact, to act for and in Executive’s behalf to execute, verify and file any such documents and to do all other lawfully permitted acts to further the purposes of the preceding paragraph with the same legal force and effect as if executed by Executive. The power of attorney set forth in this Section 4.4 is coupled with an interest, is irrevocable, and shall survive Executive’s death, incompetence or incapacity and the termination of the Employment Term. Executive waives and quitclaims to the Company all claims of any nature whatsoever which Executive now has or may in the future obtain for infringement of any Proprietary Rights assigned under this Agreement or otherwise to the Company.

(e)          Executive acknowledges that all original works of authorship which are made by Executive (solely or jointly with others) during the course of the association with or performance of services for the Company and which are protectable by copyright are “works made for hire,” as that term is defined in the United States Copyright Act and any successor statutes. Inventions assigned to the Company or as directed by the Company under this Agreement or otherwise are referred to as “Company Inventions.”

4.5          Non-Solicitation.

(a)          During the Non-Solicit Restricted Period, Executive shall not (other than in furtherance of Executive’s legitimate job duties on behalf of Company), directly or indirectly, on Executive’s own behalf or for any other person or entity:

(i)          solicit for employment or hire, attempt to solicit for employment or hire, or employ or hire, any person who is or was employed by the Company at any time within six (6) months prior to the solicitation or hire (the “Restricted Personnel”);

(ii)         seek to influence any Restricted Personnel to leave the Company’s employment, engagement, or service; or

(iii)        otherwise interfere with the relationship between any Restricted Personnel and the Company.

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(b)          During the Non-Solicit Restricted Period, Executive shall not (other than in furtherance of Executive’s legitimate job duties on behalf of Company), directly or indirectly, on Executive’s own behalf or for any other person or entity:

(i)          solicit, entice or induce any customer that did business with the Company in the last two (2) years of Executive’s employment or any prospective customer of the Company (the “Restricted Customers”) to become a customer of any person or entity other than the Company with respect to products or services sold or under development by the Company as of Executive’s termination;

(ii)         sell, promote, or provide any product or services to a Restricted Customer if that product or service could otherwise be provided by the Company; or

(iii)        solicit, entice, induce, or assist any Restricted Customer to reduce or cease doing business with the Company or otherwise interfere with the relationship between any Restricted Customer and the Company.

4.6          Non-Competition; Investment Opportunities.

(a)          During the Non-Compete Restrictive Period, Executive shall not, directly or indirectly, alone or in combination with any other individual or entity, (i) own (other than through the passive ownership of less than one percent (1%) of the publicly traded shares of any entity), operate, manage, control, or participate in an executive, managerial, strategic, or sales role, in any individual or entity (other than the Company) that engages in or proposes to engage in the Business in the United States and any other country in which Executive worked for the Company (a “Competitive Business”); or (ii) otherwise render services to (as an employee, consultant, independent contractor or otherwise) a Competitive Business that are similar to the services Executive rendered to the Company, or that could involve the use of Confidential Information; and

(b)          During the Employment Term, if Executive learns of any investment opportunity in a business or any entity engaged in the Business, Executive shall present such investment opportunity to the Company.

4.7          If any court of competent jurisdiction shall deem any provision in this Article IV too restrictive, the other provisions shall stand, and the court shall modify the unduly restrictive provision to the point of greatest restriction permissible by law.

4.8          If this Agreement is terminated for any reason, Executive acknowledges and agrees that the restrictive covenants set forth in this Article IV (the “Restrictive Covenants”) shall survive the termination of this Agreement and Executive shall continue to be bound by the terms of this Article IV as if this Agreement was still in effect.

4.9          The Company and Executive agree that damages will accrue to the Company by reason of Executive’s failure to observe any of the Restrictive Covenants. Therefore, if the Company shall institute any action or proceeding to enforce such provisions, Executive waives the claim or defense that there is an adequate remedy at law and agrees in any such action or proceeding not to (i) interpose the claim or defense that such remedy exists at law, or (ii) require the Company to show that monetary damages cannot be measured or to post any bond. Without limiting any other remedies that may be available to the Company, Executive hereby specifically affirms the appropriateness of injunctive or other equitable relief in any such action. Executive also acknowledges that the remedies afforded the Company pursuant to this Section 4.9 are not exclusive, nor shall they preclude the Company from seeking or receiving any other relief, including without limitation, any form of monetary or other equitable relief. Upon the reasonable request by the Company, Executive shall provide reasonable assurances and evidence of compliance with the Restrictive Covenants.

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ARTICLE V
POST-TERMINATION OBLIGATIONS

5.1          Return of Company Materials.   No later than three (3) business days following the termination of Executive’s employment for any reason, Executive shall return to the Company, and shall not retain in any form or media of expression, all Company and Affiliate property that is then in Executive’s possession, custody or control, including, without limitation, all keys, access cards, credit cards, computer hardware and software, documents, records, policies, marketing information, design information, specifications and plans, data base information and lists, and any other property or information that Executive has or had relating to the Company or any Affiliate (whether those materials are in paper or computer-stored form), and including but not limited to any documents containing, summarizing, or describing any Confidential Information.

5.2          Executive Assistance.   During the Employment Term and for a reasonable period thereafter, Executive shall, upon reasonable notice, assist the Company and its subsidiaries (the “Affiliated Group”) in the defense of any claims, or potential claims that may be made or threatened to be made against any member of the Affiliated Group in any action, suit or proceeding, whether civil, criminal, administrative, investigative or otherwise (a “Proceeding”), and will assist the Affiliated Group in the prosecution of any claims that may be made by any member of the Affiliated Group in any Proceeding, to the extent that such claims may relate to Executive’s employment or the period of Executive’s employment by the Company. The Company shall reimburse Executive for all of the Executive’s reasonable out-of-pocket expenses associated with such assistance, including travel expenses and any attorneys’ fees and shall pay a reasonable per diem fee for the Executive’s service under this Section 5.2. Any services or assistance contemplated in this Section 5.2 shall be at mutually agreed to and convenient times.

ARTICLE VI
MISCELLANEOUS

6.1          Notices.   Any notices, consents or other communications required or permitted to be sent or given hereunder shall be in writing and shall be deemed properly served if (i) delivered personally, in which case the date of such notice shall be the date of delivery; (ii) delivered to a nationally recognized overnight courier service, in which case the date of delivery shall be the next business day; or (iii) sent by facsimile transmission (with a copy sent by first-class mail), in which case the date of delivery shall be the date of transmission, or if after 5:00 P.M., the next business day. If not personally delivered, notice shall be sent addressed as follows: (x) if to Executive, to the address listed on the signature page hereof, and (y) if to the Company, at c/o Sterling Partners, 401 North Michigan Avenue, Suite 3300, Chicago, IL 60611, Attention: Office of General Counsel, Facsimile No. (312) 465-7100, or in either case at such other address as may hereafter be specified by notice given by either party to the other party. Executive shall promptly notify the Company of any change in his address set forth on the signature page.

6.2          Successors and Assigns.   This Agreement shall be binding upon, and inure to the benefit of, and be enforceable by, the parties hereto and the Company’s successors and permitted assigns. In the case of the Company, the successors and permitted assigns hereunder shall include without limitation any Affiliate as well as the successors in interest to the Company or any such Affiliate (whether by merger, liquidation (including successive mergers or liquidations) or otherwise). This Agreement or any right or interest hereunder is one of personal service and may not be assigned by Executive under any circumstance. Nothing in this Agreement, whether expressed or implied, is intended or shall be construed to confer upon any person other than the parties and successors and assigns permitted by this Section 6.2 any right, remedy or claim under or by reason of this Agreement.

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6.3          Entire Agreement; Amendments.   This Agreement, the Exhibits hereto and the Equity Documents embody the complete agreement and understanding of the parties hereto with regard to the subject matter hereof and supersede and preempt any prior agreements, understandings, letters of intent, or representations by or among the parties, written or oral, which may have related to the subject matter hereof. This Agreement shall not be amended, modified or supplemented except by a written instrument signed by each of the parties hereto.

6.4          Interpretation.   Article titles and section headings contained herein are inserted for convenience of reference only and are not intended to be a part of or to affect the meaning or interpretation of this Agreement.

6.5          Waivers.   No provision of this Agreement may be waived except in a writing executed and delivered by the party against whom waiver is sought. Any such written waiver shall be effective only with respect to the event or circumstance described therein and not with respect to any other event or circumstance, unless such waiver expressly provides to the contrary.

6.6          Partial Invalidity.   Wherever possible, each term and provision of this Agreement shall be interpreted so as to be effective and valid under applicable law. If any term or provision shall be held invalid or unenforceable, the remaining terms and provisions hereof not be affected thereby, unless such a construction would be unreasonable. Executive’s obligations in Articles IV and V shall survive and continue in full force notwithstanding the termination of this Agreement or Executive’s employment for any reason.

6.7          Tax Matters.  Executive acknowledges that no representative or agent of Parent or the Company has provided Executive with any tax advice of any nature, and Executive has had the opportunity to consult with his own legal, tax and financial advisor(s) as to tax and related matters concerning the compensation to be received under this Agreement.

6.8          Offset.  To the extent permitted by law, and to the extent that such action will not result in the imposition of additional taxes, interest or penalties pursuant to Section 409A (as defined below), the Company may offset any amounts Executive owes it pursuant to this Agreement or any other written agreement, note or other instrument relating to indebtedness for borrowed money to which Executive is a party or pursuant to any other liability or obligation by which Executive is bound against any amounts it owes Executive hereunder.

6.9          Execution in Counterparts.    This Agreement may be executed in one or more counterparts, each of which shall be considered an original instrument, but all of which shall be considered one and the same agreement.

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6.10        Required Delay for Deferred Compensation Under 409A.  Notwithstanding any other provision of this Agreement, if at the time of separation from service Executive is determined by the Company to be a “specified employee” (as defined in Section 409A of the Code (together, with any state law of similar effect, “Section 409A”) and Section 1.409A-1(i) of the Treasury Regulations), and the Company determines that delayed commencement of any portion of the termination payments and benefits payable to Executive pursuant to this Agreement is required in order to avoid a prohibited distribution under Section 409A(a)(2)(B)(i) of the Code, then such portion of Executive’s termination payments and benefits shall not be provided to Executive prior to the earliest of (1) the date that is six months and one day after Executive’s separation from service, (2) the date of Executive’s death or (3) such earlier date as is permitted under Section 409A (any such delayed commencement, a “Payment Delay”). Upon the expiration of such Payment Delay, all payments deferred pursuant to a Payment Delay shall be paid in a lump sum to Executive on the first day following the expiration of the Payment Delay, and any remaining payments due under the Agreement shall be paid on the original schedule provided herein.

This Agreement is intended to meet the requirements of Section 409A, and shall be interpreted and construed consistent with that intent. References to termination of employment, retirement, separation from service and similar or correlative terms in this Agreement shall mean a “separation from service” (as defined at Section 1.409A-1(h) of the Treasury Regulations) from the Company and from all other corporations and trades or businesses, if any, that would be treated as a single “service recipient” with the Company under Section 1.409A-1(h)(3) of the Treasury Regulations. Each installment of the payments and benefits provided for in this Agreement shall be treated as a separate “payment” for purposes of Treasury Regulation Section 1.409A-2(b)(2)(i).

6.11        Governing Law; Consent to Jurisdiction; Waiver of Jury.   This Agreement shall be governed by and construed in accordance with the internal laws of the State of Georgia, without regard to its conflict of law principles. For the purposes of any suit, action, or other proceeding arising out of this Agreement or with respect to Executive’s employment hereunder, the Parties hereto: (i) agree to submit to the exclusive jurisdiction of the federal or state courts located in Fulton County, State of Georgia, (ii) agree to unconditionally waive any objection to venue in such jurisdiction, and agree not to plead or claim forum non conveniens, and (iii) to waive their respective rights to a jury trial of any and such claims and causes of action.

6.12        Construction.   The language used in this Agreement will be deemed to be the language chosen by Executive and the Company to express their mutual intent, and no rule of strict construction will be applied against Executive or the Company.

*           *           *

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IN WITNESS WHEREOF, the Company has caused this Employment Agreement to be duly executed by an officer thereunto duly authorized, and Executive has hereunto set his hand, all as of the day and year first above written.

THE COMPANY:
INNOTRAC CORPORATION
By:	/s/ Scott Dorfman
	Name:	Scott Dorfman
	Title:	Chief Executive Officer
EXECUTIVE:

/s/ Edgar L. Ringer
Name: Edgar L. Ringer
Address:	[REDACTED]
	[REDACTED]
Phone:	[REDACTED]
Fax:

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Exhibit A

Form of Release

THIS RELEASE (the “Release”) is entered into between Ed Ringer (“Executive”) and Innotrac Corporation, a Georgia corporation (the “Company”), for the benefit of the Company. The entering into and non-revocation of this Release is a condition to Executive’s right to receive the payments under Section 3.2 of the Employment Agreement entered into by and between Executive and the Company, dated as of November 14, 2013 (the “Employment Agreement”). Capitalized terms used and not defined herein shall have the meaning provided in the Employment Agreement.

Accordingly, Executive and the Company agree as follows.

1.           In consideration for the payments and other benefits provided to Executive under Section 3.2(a) of the Employment Agreement, Executive represents and agrees, as follows:

(a)          Executive, for himself, his heirs, administrators, representatives, executors, successors and assigns (collectively “Releasers”), hereby irrevocably and unconditionally releases, acquits and forever discharges and agrees not to sue the Company or any of its parents, subsidiaries, divisions, affiliates and related entities and its current and former directors, officers, shareholders, trustees, employees, consultants, independent contractors, representatives, agents, servants, successors and assigns and all persons acting by, through or under or in concert with any of them (collectively “Releasees”), from all claims, rights and liabilities up to and including the date of this Release arising from or relating to Executive’s employment with, or termination of employment from, the Company, under the Employment Agreement and from any and all charges, complaints, claims, liabilities, obligations, promises, agreements, controversies, damages, actions, causes of actions, suits, rights, demands, costs, losses, debts and expenses of any nature whatsoever, known or unknown, suspected or unsuspected and any claims of wrongful discharge, breach of contract, implied contract, promissory estoppel, defamation, slander, libel, tortious conduct, employment discrimination or claims under any federal, state or local employment statute, law, order or ordinance, including any rights or claims arising under Title VII of the Civil Rights Act of 1964, as amended, the Age Discrimination in Employment Act of 1967, as amended, 29 U.S.C. § 621 et seq. (“ADEA”), or any other federal, state or municipal ordinance relating to discrimination in employment. Nothing contained herein shall restrict the parties’ rights to enforce the terms of this Release.

(b)          To the maximum extent permitted by law, Executive agrees that he has not filed, nor will he ever file, a lawsuit asserting any claims which are released by this Release.

(c)          This Release specifically excludes Executive’s rights and the Company’s obligations under Sections 3.2 and 6.14 of the Employment Agreement, the Benefit Plans, and the Equity Documents. Executive’s entitlement to vested benefits under the Benefit Plans and the Equity Documents shall be determined in accordance with the provisions of the Benefit Plans or Equity Documents, as the case may be. Nothing contained in this Release shall release Executive from his obligations, including any obligations to abide by restrictive covenants, under the Employment Agreement, the Equity Documents or the Benefit Plans that continue or are to be performed following termination of employment.

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(d)          The parties agree that this Release shall not affect the rights and responsibilities of the US Equal Employment Opportunity Commission (hereinafter “EEOC”) to enforce ADEA and other laws. In addition, the parties agree that this Release shall not be used to justify interfering with Executive’s protected right to file a charge or participate in an investigation or proceeding conducted by the EEOC. The parties further agree that Executive knowingly and voluntarily waives all rights or claims (that arose prior to Executive’s execution of this Release) the Releasers may have against the Releasees, or any of them, to receive any benefit or remedial relief (including, but not limited to, reinstatement, back pay, front pay, damages, attorneys’ fees, experts’ fees) as a consequence of any investigation or proceeding conducted by the EEOC.

2.           Executive acknowledges that the Company has specifically advised him of the right to seek the advice of an attorney concerning the terms and conditions of this Release. Executive further acknowledges that he has been furnished with a copy of this Release, and he has been afforded twenty-one (21) days in which to consider the terms and conditions set forth above prior to this Release. By executing this Release, Executive affirmatively states that he has had sufficient and reasonable time to review this Release and to consult with an attorney concerning his legal rights prior to the final execution of this Release. Executive further agrees that he has carefully read this Release and fully understands its terms. Executive understands that he may revoke this Release within seven (7) days after signing this Release. Revocation of this Release must be made in writing and must be received by [●] at [●] within the time period set forth above.

3.           This Release will be governed by and construed in accordance with the laws of the state of Georgia, without giving effect to any choice of law or conflicting provision or rule (whether of the state of Georgia or any other jurisdiction) that would cause the laws of any jurisdiction other than the state of Georgia to be applied. In furtherance of the foregoing, the internal law of the state of Georgia will control the interpretation and construction of this agreement, even if under such jurisdiction’s choice of law or conflict of law analysis, the substantive law of some other jurisdiction would ordinarily apply. The provisions of this Release are severable, and if any part or portion of it is found to be unenforceable, the other paragraphs shall remain fully valid and enforceable. This Release shall become effective and enforceable on the eighth day following its execution by Executive, provided he does not exercise his right of revocation as described above. If Executive fails to sign and deliver this Release or revokes his signature, this Release will be without force or effect, and Executive shall not be entitled to the payment under Section 3.2 of the Employment Agreement.

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Exhibit B

Prior Inventions

None.

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EX-10.9

exhibit 10.9

FORM OF
SUBSCRIPTION AND SUPPORT AGREEMENT

This SUBSCRIPTION AND SUPPORT AGREEMENT (this “Agreement”), dated as of November 14, 2013, is made by and between Blue Eagle Holdings, L.P., a Delaware limited partnership (“Parent”), and the undersigned shareholder of the Company (the “Investor”). Parent and the Investor are sometimes individually referred to herein as a “Party” and collectively as the “Parties.” Capitalized terms used but not defined herein shall have the meanings set forth in the Merger Agreement (as defined herein).

RECITALS

A.           Immediately following the execution and delivery of this Agreement, Parent, Innotrac Corporation, a Georgia corporation (the “Company”), and Blue Eagle Acquisition Sub, Inc., a Georgia corporation and a wholly-owned subsidiary of Parent (“Purchaser”), will enter into an Agreement and Plan of Merger, dated as of the date hereof (the “Merger Agreement”).

B.           On the terms and subject to the conditions set forth in the Merger Agreement, (i) Purchaser will commence a tender offer to purchase (the “Offer”) all of the issued and outstanding shares of common stock of the Company, par value $0.10 per share (the “Common Stock”), at an offer price equal to the Offer Price payable to the seller in cash, without interest, subject to withholding of taxes required by applicable Law and (ii) following the consummation of the Offer and at the Effective Time, Purchaser will merge with and into the Company (the “Merger”), with the Company continuing as the surviving corporation, whereby each issued and outstanding share of Common Stock (other than Excluded Shares) will be converted into the right to receive the Common Merger Consideration payable to the seller in cash, without interest, subject to withholding of taxes required by applicable Law.

C.           The Investor beneficially owns the number of shares of Common Stock set forth opposite the Investor’s name on Schedule I hereto under the heading “Investor Owned Shares” (such shares of Common Stock, together with any other shares of Common Stock the beneficial ownership of which is directly or indirectly acquired by the Investor until the termination of this Agreement pursuant to the terms hereof, are collectively referred to herein as the “Investor Owned Shares”).

D.           At the Subscription Closing (as defined herein), the Investor will acquire from Parent, and Parent will issue and deliver to the Investor the number of shares of Preferred Units in Investor (“Preferred Units”) set forth opposite the Investor’s name on Schedule I hereto under the heading “Purchased Units” (such Preferred Units, the “Purchased Units”). Such transaction is hereby referred to as the “Subscription.”

E.           In order to facilitate the transactions contemplated by this Agreement in accordance with the requirements of Rule 14d-10(a)(2) promulgated under the Exchange Act with respect to the Offer, the Investor will not tender any of the Investor Owned Shares in connection with the Offer.

NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth below, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:

ARTICLE I

SUBSCRIPTION

Section 1.1           Subscription. Upon the terms and subject to the conditions of this Agreement, at the Subscription Closing, (a) Parent will issue and deliver to the Investor the Purchased Units free and clear of all Liens other than any such Lien arising hereunder and any applicable restriction on transfer under applicable securities Law, and (b) in consideration for such Purchased Units, the Investor will make a capital contribution to Parent in the aggregate amount of __________. Such capital contribution shall be made by wire transfer of immediately available funds at the Subscription Closing.

Section 1.2           Subscription Closing. Subject to the satisfaction or waiver of the conditions to the Subscription set forth in Section 1.3, the closing of the Subscription (the “Subscription Closing”) will take place immediately after Purchaser’s acceptance of the shares of Common Stock tendered pursuant to the Offer at the offices of Kilpatrick Townsend & Stockton LLP, 1100 Peachtree Street NE, Suite 2800, Atlanta, Georgia 30309-4528. At the Subscription Closing, the Investor will deliver or cause to be delivered to Parent a counterpart signature page to the Amended and Restated Limited Partnership Agreement of Parent, in substantially the form attached hereto as Exhibit A (the “Limited Partnership Agreement”). Upon receipt of the foregoing deliveries by Parent, and effective as of the Subscription Closing, the Investor will be admitted as a limited partner of Parent. The rights, privileges and preferences of the Purchased Units issued to the Investor shall be as set forth in the Limited Partnership Agreement. The date upon which the Subscription Closing occurs is the “Subscription Closing Date”.

Section 1.3           Conditions to Subscription.

(a)           Conditions to Parent’s Obligations. The obligations of Parent to consummate the Subscription are subject to the satisfaction or waiver by Parent of the following conditions:

(i)           all of the conditions to the consummation of the Merger under the Merger Agreement shall have been satisfied;

(ii)          the representations and warranties of the Investor contained in Article IV of this Agreement shall be true and correct in all material respects as of the date of this Agreement and as of the Subscription Closing Date with the same force and effect as if made on and as of such date;

(iii)         the Investor shall have performed in all material respects all of its obligations under this Agreement required to be performed by it at or prior to the Subscription Closing; and

(iv)         no Restraint shall be in effect enjoining, restraining, preventing or prohibiting the consummation of the Subscription or making the consummation of the Subscription illegal.

(b)           Conditions to Investor’s Obligations. The obligations of the Investor to consummate the Subscription are subject to the satisfaction or waiver by the Investor of the following conditions:

(i)         all of the conditions to the consummation of the Merger under the Merger Agreement shall have been satisfied;

(ii)         the representations and warranties of Parent contained in Article V of this Agreement shall be true and correct in all material respects as of the date of this Agreement and as of the Subscription Closing Date with the same force and effect as if made on and as of such date;

(iii)        Parent shall have performed in all material respects all of its obligations under this Agreement required to be performed by it at or prior to the Subscription Closing; and

(iv)        no Restraint shall be in effect enjoining, restraining, preventing or prohibiting the consummation of the Subscription or making the consummation of Subscription illegal.

ARTICLE II

COVENANTS REGARDING INVESTOR OWNED SHARES

Section 2.1           Agreement Not to Tender. The Investor agrees that he shall not, without the prior written consent of Parent, directly or indirectly, tender the Investor Owned Shares into the Offer in any manner. The Investor agrees to comply in all respects with Rule 14e-5 promulgated under the Exchange Act (notwithstanding whether the Investor would be subject to Rule 14e-5).

Section 2.2           Voting Agreement.

(a)          From and after the date hereof, at any meeting of the Company’s shareholders (or any adjournment or postponement thereof), however called, the Investor separately agrees to vote (or cause to be voted) in person or by proxy all of the Investor Owned Shares:

(i)          in favor of (and shall provide written consent to) the approval of the Merger Agreement and the Transaction (and in favor of any actions and proposals required, or submitted for approval at any meeting of the Company shareholders, in furtherance thereof);

(ii)         against (and shall not provide any written consent to) any proposal presented to the Company’s shareholders for approval at any meeting of the Company’s shareholders, or any written consent in lieu thereof, if the action, transaction or agreement that is the subject of such proposal, following approval by the Company’s shareholders would reasonably be expected, directly or indirectly, to result in a breach by the Company of any covenant, representation, warranty or other obligations of the Company set forth in the Merger Agreement; and

(iii)        against (and shall not provide any written consent to) the following actions or proposals (other than the Transaction): (A) any Takeover Proposal; (B) the adoption of any Acquisition Agreement or any other agreement relating to a Takeover Proposal, (C) any nominee for election to the Board other than (x) a Person nominated by the Board or any committee thereof and/or (y) Scott D. Dorfman; or (D) any other action or proposal to be voted upon by the Company’s shareholders at any meeting of the Company’s shareholders, or any written consent in lieu thereof, if such action or proposal would reasonably be expected, to prevent, impede, interfere with, delay, postpone or adversely affect the Transaction.

(b)         The Investor agrees to cause the Investor Owned Shares to be duly counted for purposes of determining that a quorum is present and for purposes of recording the results of any vote or consent required pursuant to Section 2.2(a).

(d)          Parent acknowledges that the Investor has entered into this Agreement solely in the Investor’s capacity as the record or beneficial owner of the Investor Owned Shares (and not in any other capacity, including any capacity as a director or officer of the Company). Nothing herein shall limit or affect any actions taken by the Investor in the Investor’s capacity as a director or officer of the Company, or require the Investor to take any action in the Investor’s capacity as a director or officer of the Company. Without limiting the foregoing, and for the avoidance of doubt, nothing in this Section 2.2(c) shall affect any of the rights or remedies of Parent and Purchaser under the Merger Agreement or relieve the Company from any breach or violation of the Merger Agreement caused by any action or omission of the Investor (in the Investor’s capacity as a director or officer of the Company or otherwise).

Section 2.3           Irrevocable Proxy.

(a)          In furtherance of the Investor’s agreements in Sections 2.1 and 2.2 of this Agreement, the Investor hereby appoints Parent and Parent’s designees, and each of them individually, as the Investor’s proxy and attorney-in-fact (with full power of substitution) (the “Proxyholders”), for and in the name, place and stead of the Investor, to vote all Investor Owned Shares owned by the Investor (at any meeting of the Company’s shareholders (or any adjournment or postponement thereof), however called), or to execute one or more written consents in respect of the Investor Owned Shares with respect to the matters described in Section 2.2(a) of this Agreement. If the Investor fails for any reason to be counted as present or to vote (including by written consent, if applicable) the Investor Owned Shares in accordance with the requirements of Section 2.2(a) above, then Parent shall have the right to cause to be present or vote the Investor Owned Shares in accordance with the provisions of Section 2.2(a). The Proxyholders may not exercise this irrevocable proxy on any matter except as provided above. The Investor may vote the Investor Owned Shares on all other matters.

(b)          The proxy granted pursuant to Section 2.3(a) shall (i) be valid and irrevocable until the valid termination of this Agreement in accordance with (or as otherwise provided in) Article VI hereof and (ii) automatically terminate upon the valid termination of this Agreement in accordance with (or as otherwise provided in) Section 6.1 hereof. The Investor represents that any and all other proxies and powers of attorney heretofore given in respect of the Investor Owned Shares are revocable, and that such other proxies have been revoked. The Investor affirms that the foregoing proxy is: (A) given (I) in connection with the execution of the Merger Agreement and (II) to secure the performance of the Investor’s duties under this Agreement, (B) coupled with an interest and may not be revoked except as otherwise provided in this Agreement and (C) intended to be irrevocable prior to valid termination of this Agreement or as otherwise provided in Section 6.1 hereof. All authority herein conferred shall survive the death, bankruptcy or incapacity of the Investor and shall be binding upon the heirs, estate, administrators, personal representatives, successors and assigns of the Investor.

Section 2.4           Documentation and Information. The Investor (i) consents to and authorizes the publication and disclosure by Parent of the Investor’s identity and holdings of the Investor Owned Shares and the nature of the Investor’s commitments, arrangements and understandings under this Agreement, in any press release, the Offer Documents or any other disclosure document required in connection with the Transaction, and (ii) will use reasonable best efforts to give to Parent, as promptly as practicable, any information reasonably related to the foregoing as it may reasonably require for the preparation of any such disclosure documents. The Investor will use reasonable best efforts to notify Parent, as promptly as practicable, of any required corrections with respect to any written information supplied by the Investor specifically for use in any such disclosure document, if and to the extent the Investor becomes aware that any such information has become false or misleading in any material respect.

Section 2.5           Other Actions. The Investor agrees not to enter into any agreement or commitment with any Person the effect of which would, or would reasonably be expected to, violate, be inconsistent with or otherwise frustrate the purposes of the provisions and agreements set forth in this Article II.

ARTICLE III

STANDSTILL AND NON-SOLICITATION

Section 3.1           Standstill in Respect of Investor Owned Shares. The Investor hereby agrees that, from and after the date hereof until the earlier of the Effective Time and the valid termination of the Merger Agreement, the Investor shall not, directly or indirectly, unless (i) specifically requested by Parent in writing or (ii) expressly contemplated by the terms of this Agreement or the Merger Agreement:

(a)          sell, transfer, tender, pledge, encumber, assign or otherwise dispose of (collectively, a “Transfer”), or enter into any contract, option or other agreement with respect to, or consent to, a Transfer of, any or all of the Investor Owned Shares; provided that this Section 3.1(a) shall not limit or preclude the Investor’s right to Transfer any Investor Owned Shares to any Permitted Transferee solely for estate planning or charitable purposes, provided that, (i) the Investor provides at least three Business Days advance written notice to Parent of such proposed transfer (including providing such other information and documentation related to the proposed Permitted Transferee as Parent may reasonably request), (ii) such Permitted Transferee agrees in a written agreement with Parent in form and substance satisfactory to Parent, in its reasonable discretion, to hold the Investor Owned Shares pursuant to, and to be bound by, the terms and conditions of this Agreement as an “Investor” hereunder, and to make each of the representations and warranties (which may be made in reliance upon a certificate from the Investor) hereunder in respect of the Investor Owned Shares transferred as the Investor shall have made hereunder and (iii) an opinion, in form and substance reasonably acceptable to Parent, of counsel that is knowledgeable in securities matters to the effect that such Transfer was made in accordance with applicable securities Laws and that this Agreement is binding upon and enforceable against such Permitted Transferee; provided, further, in the event that any proposed Permitted Transferee does not comply with the obligations imposed hereunder with respect to the Investor Owned Shares purported to be transferred to such Person, such transfer shall be deemed null and void ab initio;

(b)          acquire, offer to acquire, or agree to acquire, directly or indirectly, by purchase or otherwise, any assets of the Company or any Company Subsidiary;

(c)          make, or in any way participate in, directly or indirectly, any “solicitation” of “proxies” (as such terms are used in the rules of the Securities and Exchange Commission) to vote or consent to, or otherwise take any action intended to advise or influence any Person with respect to the voting of, or giving consent with respect to, any voting securities of the Company, other than in support of the Transaction and the Merger Agreement;

(c)          make any public announcement with respect to, or submit a proposal for, or offer for (with or without conditions) any extraordinary transaction involving the Company, any Company Subsidiary or their securities or assets;

(d)          form, join or in any way participate in a “group” (as defined in Section 13(d)(3) of the Exchange Act) in connection with any of the foregoing;

(e)          seek, in any way which may be reasonably likely to require, involve or trigger public disclosure of such request pursuant to applicable Law, to have any provision of this Section 3.1 amended, modified or waived; or

(f)          otherwise take, directly or indirectly, any actions with the purpose of avoiding or circumventing any provision of this Section 3.1 or which would reasonably be expected to have the effect of preventing, impeding, interfering with or adversely affecting the consummation of the Transaction or its ability to perform the Investor’s obligations under this Agreement.

Any action taken in violation of the foregoing shall be null and void ab initio.

Section 3.2           Dividends, Distributions, Etc. in Respect of Investor Owned Shares; Additional Investor Owned Shares. In the event of a share dividend or share distribution, or any change in the shares of Common Stock by reason of any share dividend or share distribution, split-up, recapitalization, combination, exchange of shares or the like, the term “Investor Owned Shares” shall be deemed to refer to and include the Investor Owned Shares as well as all such share dividends and share distributions and any securities into which or for which any or all of the Investor Owned Shares may be changed or exchanged or which are received in such transaction. The Investor hereby agrees, during the term of this Agreement, to promptly notify Parent of any new shares of Common Stock acquired by the Investor, if any, after the execution of this Agreement. Any such shares of Common Stock shall be subject to the terms of this Agreement as though owned by the Investor on the date of this Agreement.

Section 3.3           Competing Proposals in Respect of Investor Owned Shares.

(a)          The Investor shall not, and shall use reasonable best efforts to ensure that each of the Investor’s Representatives and Affiliates do not, directly or indirectly: (i) solicit or initiate, or knowingly facilitate or encourage (including by way of providing information), any inquiries, proposals or offers that constitute, or that would reasonably be expected to lead to, a Takeover Proposal; (ii) participate in any negotiations regarding, or furnish to any person (other than Parent, the Company, any other Investor or any Representatives of the Investor, Parent, the Company or any other Investor) any nonpublic information with respect to, any Takeover Proposal; or (iii) engage in discussions with any Person (other than Parent, the Company, any other Investor or any Representatives of the Investor, Parent, the Company or any other Investor) with respect to any Takeover Proposal. Notwithstanding the foregoing, nothing in this Agreement shall prohibit an Investor (A) who is an officer or director of the Company from taking any action in the Investor’s capacity as an officer or director of the Company that is permitted to be taken by an officer or director of the Company under Section 4.02 of the Merger Agreement and (B) from engaging in discussions with a third party that the Company is permitted to engage in discussions with regarding a Takeover Proposal or Acquisition Transaction pursuant to Section 4.02(c) or 4.02(g) of the Merger Agreement regarding the Investor’s equity participation, investment or reinvestment in a Takeover Proposal or an Acquisition Transaction; provided that prior to the termination of this Agreement, no Investor will enter into any agreement with respect to any of the foregoing.

(b)          If the Investor, or any of the Investor’s Representatives, at any time during the period beginning on the date hereof and ending on the valid termination of this Agreement, receives any bona fide Takeover Proposal (or any other inquiry regarding a potential Takeover Proposal) from a potential bidder or its Representatives, then the Investor shall promptly: (i) advise the Company and Parent in writing of such Takeover Proposal or inquiry (including the identity of the Person making or submitting such Takeover Proposal or inquiry and the material terms and conditions thereof); and (ii) provide the Company and Parent with copies of all documents and other written communications received by the Investor setting forth the terms and conditions of such Takeover Proposal or inquiry.

(c)          The Investor shall, and shall ensure that each of the Investor’s Representatives and Affiliates (if applicable), immediately terminate and cause to be terminated any existing solicitation by the Investor or the Investor’s Representatives or Affiliates of, or discussions or negotiations between the Investor or the Investor’s Representatives or Affiliates and, any Person relating to any Takeover Proposal, and the Investor shall be responsible for any breach of this Agreement by the Investor’s Representatives or Affiliates.

(d)          The Investor agrees to promptly inform each of the Investor’s Representatives and the Representatives of the Investor’s Affiliates’ of the obligations undertaken in this Article III.

ARTICLE IV

REPRESENTATIONS AND WARRANTIES OF THE INVESTOR

The Investor hereby represents and warrants to Parent as follows:

Section 4.1           Binding Nature of Agreement. This Agreement has been duly and validly executed and delivered by the Investor and, assuming that this Agreement constitutes the valid and binding agreement of Parent, constitutes the valid and binding agreement of the Investor, enforceable against the Investor in accordance with its terms, except that such enforceability may be limited by (i) bankruptcy, insolvency, reorganization, moratorium or other similar Laws now or hereafter in effect relating to creditors’ rights generally, and (ii) general principles of equity (regardless of whether enforceability is considered in a proceeding in equity or at law).

Section 4.2           Ownership of Shares. As of the date hereof, the Investor beneficially owns the number of Investor Owned Shares set forth opposite the name of the Investor on Schedule I hereto under the heading “Investor Owned Shares”. Such Investor has the sole power to vote (or cause to be voted) the Investor Owned Shares and has good and valid title to the Investor Owned Shares, free and clear of any and all Liens, other than those created by this Agreement or restrictions on transfer arising under applicable securities Law.

Section 4.3           No Conflicts. Neither the execution and delivery of this Agreement by the Investor, nor the consummation by the Investor of the transactions contemplated hereby, will result in, or give rise to, a violation or breach of or a default under any of the terms of any material contract, understanding, agreement or other instrument or obligation to which the Investor is a party or by which the Investor or any of the Investor Owned Shares or the Investor’s assets may be bound, or (ii) violate any applicable Law, except, with respect to any of the foregoing clauses (i) and (ii), as does not and would not reasonably be expected to impair the Investor’s ability to perform the Investor’s obligations under this Agreement.

Section 4.4           Investment Intent. The Investor is acquiring the Purchased Units for the Investor’s own account, for investment only, and not with a view to any resale or public distribution thereof. The Investor agrees that the Investor will not offer to sell or otherwise dispose of the Purchased Units to be held by it in violation of any applicable Law. Each the Investor acknowledges that (a) the Purchased Units have not been registered under the Securities Act, or any state or foreign securities Laws, (b) there is no public market for the Purchased Units and there can be no assurance that a public market shall develop, (c) the Purchased Units are subject to the restrictions on transfer set forth in the Limited Partnership Agreement and (d) the Investor must bear the economic risk of its investment in the Purchased Units to be held by it for an indefinite period of time. The Investor has all requisite legal power and authority to acquire the Purchased Units in accordance with the terms of this Agreement and is an “accredited investor” within the meaning of the Rule 501 promulgated under the Securities Act. Such Investor has been given the opportunity to consult with independent legal counsel regarding the Investor’s rights and obligations under the Limited Partnership Agreement, has read and fully understands the terms and conditions contained in the Limited Partnership Agreement, and intends for such terms to be binding and enforceable upon the Investor.

Section 4.5           Enforceability Against Spouses. If the Investor is a married individual and the Investor Owned Shares constitute community property or otherwise require spousal approval in order for this Agreement to be a legally valid and binding obligation of the Investor, this Agreement has been duly executed and delivered by Investor’s spouse and constitutes a legally valid and binding obligation of the Investor’s spouse, enforceable against the Investor’s spouse in accordance with its terms, except that such enforceability may be limited by (i) bankruptcy, insolvency, reorganization, moratorium or other similar Laws now or hereafter in effect relating to creditors’ rights generally, and (ii) general principles of equity (regardless of whether enforceability is considered in a proceeding in equity or at law).

Section 4.6           Reliance by Parent. Such Investor understands and acknowledges that Parent is entering into the Merger Agreement in reliance upon the Investor’s execution and delivery of this Agreement and the representations and warranties of the Investor contained herein. Such Investor understands and acknowledges that the Merger Agreement governs the terms of the Merger and the Transaction.

The Investor that is a non-natural person further severally and not jointly represents and warrants to Parent as follows:

Section 4.7           Due Organization. Such Investor is duly organized, validly existing and in good standing under the Laws of its jurisdiction of formation.

Section 4.8           Authority Relative to This Agreement. Such Investor has the requisite power and authority to execute and deliver this Agreement and to consummate the transactions contemplated hereby. This Agreement and the consummation by the Investor of the transactions contemplated hereby have been duly and validly authorized by the board of directors, general partner or similar governing body of the Investor, and no other corporate proceedings on the part of the Investor are necessary to authorize this Agreement or to consummate the transactions contemplated hereby.

Section 4.9           No Conflicts. Neither the execution and delivery of this Agreement by the Investor, nor the consummation by the Investor of the transactions contemplated hereby, will conflict with or result in any breach of the organizational documents of the Investor.

ARTICLE V
REPRESENTATION AND WARRANTIES OF PARENT

Parent hereby represents and warrants to the Investor as follows:

Section 5.1           Due Organization. Parent is a limited partnership duly organized, validly existing and in good standing under the Laws of the State of Delaware.

Section 5.2           Authority Relative to This Agreement. Parent has the requisite limited partnership power and authority to execute and deliver this Agreement and to consummate the transactions contemplated hereby. This Agreement and the consummation by Parent of the transactions contemplated hereby have been duly and validly authorized by the general partner of Parent, and no other limited partnership proceedings on the part of Parent are necessary to authorize this Agreement or to consummate the transactions contemplated hereby. This Agreement has been duly and validly executed and delivered by Parent and, assuming that this Agreement constitutes the valid and binding agreement of the Investor, constitutes the valid and binding agreement of Parent, enforceable against Parent in accordance with its terms, except that such enforceability may be limited by (i) bankruptcy, insolvency, reorganization, moratorium or other similar Laws now or hereafter in effect relating to creditors’ rights generally, and (ii) general principles of equity (regardless of whether enforceability is considered in a proceeding in equity or at law).

Section 5.3           No Conflicts. Neither the execution and delivery of this Agreement by Parent, nor the consummation by Parent of the transactions contemplated hereby, will (i) conflict with or result in any breach of the governing documents of Parent; (ii) require any Permit from any Governmental Authority; (iii) result in, or give rise to, a violation or breach of or a default under any of the terms of any material contract, understanding, agreement or other instrument or obligation to which Parent is a party, or (iv) violate any applicable Law, except, with respect to any of the foregoing clauses (i) through (iv), as does not and could not reasonably be expected to impair Parent’s ability to perform its obligations under this Agreement.

Section 5.4           Valid Issuance of Purchased Units. Assuming the truth and accuracy of the representations and warranties set forth in Section 4.4, when issued and delivered on the Subscription Closing Date, the Purchased Units shall be validly issued and fully paid and shall have been issued in compliance with the Securities Act and applicable state securities Laws.

ARTICLE vi

termination

Section 6.1           Termination.

(a)          Subject to Section 6.1(b), this Agreement shall terminate (except for Article VI and Article VII, which shall survive such termination), without further action by any of the parties hereto, and none of Parent or the Investor shall have any rights or obligations under this Agreement, immediately upon the earliest to occur of: (i) the termination of this Agreement by mutual written consent of Parent and the Investor, (ii) the termination of the Merger Agreement in accordance with its terms (provided, however, that the Investor’s obligations under Section 2.2(a)(iii) and Section 3.3 shall survive for 18 months following any termination of the Merger Agreement by Parent pursuant to Section 7.01(c)(ii) of the Merger Agreement as a result of the Board effecting a Company Adverse Recommendation Change resulting from an Intervening Event) and (iii) the Effective Time of the Merger.

(b)          Notwithstanding Section 6.1(a), termination of this Agreement shall not prevent any party hereunder from seeking any remedies (at law or in equity) against any other party hereto for such party’s breach of any of the terms of this Agreement prior to the termination of this Agreement.

ARTICLE vii

MISCELLANEOUS PROVISIONS

Section 7.1           Dissenters’ Rights. To the extent permitted by applicable Law, the Investor hereby waives and agrees not to exercise any rights to dissent from the Transaction that he, she or it may have under applicable Law.

Section 7.2           Further Actions. Each of the Parties agrees to use reasonable best efforts to do all things reasonably necessary to effectuate this Agreement.

Section 7.3           Waivers. No failure on the part of any party to exercise any power, right, privilege or remedy under this Agreement, and no delay on the part of any party in exercising any power, right, privilege or remedy under this Agreement, shall operate as a waiver of such power, right, privilege or remedy; and no single or partial exercise of any such power, right, privilege or remedy shall preclude any other or further exercise thereof or of any other power, right, privilege or remedy. No party shall be deemed to have waived any claim arising out of this Agreement, or any power, right, privilege or remedy under this Agreement, unless the waiver of such claim, power, right, privilege or remedy is expressly set forth in a written instrument duly executed and delivered on behalf of such party; and any such waiver shall not be applicable or have any effect except in the specific instance in which it is given.

Section 7.4          Counterparts. This Agreement may be executed and delivered (including by facsimile transmission or by e-mail of a .pdf attachment) in two or more counterparts, and by the different parties hereto in separate counterparts, each of which when executed and delivered shall be deemed to be an original but all of which taken together shall constitute one and the same agreement.

Section 7.5           GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF GEORGIA, REGARDLESS OF THE LAWS THAT MIGHT OTHERWISE GOVERN UNDER APPLICABLE PRINCIPLES OF CONFLICTS OF LAWS THEREOF.

Section 7.6           Venue and Exclusive Jurisdiction. Each of the Parties (a) consents to submit itself to the exclusive personal jurisdiction of the federal and state courts located in the State of Georgia situated in Fulton County, in the event any dispute arises out of this Agreement, (b) agrees that he, she or it will not attempt to deny or defeat such personal jurisdiction by motion or other request for leave from any such court and (c) agrees that he, she or it will not bring any action relating to this Agreement in any court other than the federal and state courts located in the State of Georgia situated in Fulton County. Each Party hereby (i) consents to service of process in any action between the parties arising in whole or in part under or in connection with this Agreement in any manner permitted by Georgia Law, (ii) agrees that service of process made in accordance with clause (i) or made by registered or certified mail, return receipt requested, at its address specified on the first page of this Agreement, will constitute good and valid service of process in any such action, and (iii) waives and agrees not to assert (by way of motion, as a defense, or otherwise) in any such action any claim that service of process made in accordance with clause (i) or (ii) does not constitute good and valid service of process.

Section 7.7           Waiver of Jury Trial. Each Party hereby unconditionally and irrevocably waives, to the fullest extent permitted by applicable Law, any right it may have to a trial by jury in respect of any Proceeding arising out of this Agreement. Each party hereto certifies and acknowledges that (a) no representative, agent or attorney of any other Party has represented, expressly or otherwise, that such other Party would not, in the event of any action, suit or proceeding, seek to enforce the foregoing waiver in the event of a legal action, (b) such {arty has considered the implications of this waiver, (c) such party makes this waiver voluntarily and (d) such {arty has been induced to enter into this Agreement, by, among other things, the mutual waiver and certifications in this Section 7.7.

Section 7.8           Notices. Any notice required to be given hereunder shall be sufficient if in writing, and sent by facsimile transmission or e-mail of a .pdf attachment (provided that any notice received by facsimile or e-mail transmission or otherwise at the addressee’s location on any Business Day after 5:00 p.m. (addressee’s local time) shall be deemed to have been received at 9:00 a.m. (addressee’s local time) on the next Business Day), by reliable overnight delivery service (with proof of service), hand delivery or certified or registered mail (return receipt requested and first-class postage prepaid), addressed as follows (or at such other address for a party as shall be specified in a notice given in accordance with this Section 7.8):

If to Parent to:
c/o Sterling Fund Management, LLC
401 North Michigan Avenue, Suite 3300
Chicago, Illinois 60611
Attention: Office of General Counsel
Facsimile No.: (312) 465-7001 Email:  aepstein@sterlingpartners.com
with a copy to:
Katten Muchin Rosenman LLP
525 West Monroe Street
Chicago, Illinois 60661
Attention:	Saul Rudo, Esq.
	Jeffrey R. Patt, Esq.
Facsimile No. (312) 577-8870
Email:  saul.rudo@kattenlaw.com jeffrey.patt@kattenlaw.com
If to the Investor, to:
with a copy to:
Ledbetter Wanamaker Glass LLP
1201 Peachtree St., Suite 1501
Atlanta, Georgia 30361
Attention: Bruce D. Wanamaker, Esq.
Facsimile No.: (404) 835-9540 Email: bwanamaker@lwglaw.com

Section 7.9           Entire Agreement.  This Agreement constitutes the entire agreement and supersedes all prior agreements and understandings, both written and oral, or among the Parties with respect to the subject matter hereof. This Agreement shall be binding upon, and shall be enforceable by and inure solely to the benefit of, the Parties and their respective successors and permitted assigns; provided, however, that neither this Agreement nor any of the Parties’ rights, interests or obligations hereunder may be assigned or delegated, in whole or in part, by operation of law or otherwise, without the prior written consent of the other Parties, and any attempted assignment or delegation of this Agreement or any of such rights, interests or obligations by any Party without the other Parties’ prior written consent shall be void and of no effect; provided, however, that Parent may assign this Agreement to an Affiliate thereof; provided that, upon such assignment, Parent shall remain jointly and severally liable with its applicable Affiliate to the Investor for performing all of its obligations hereunder. Nothing in this Agreement, express or implied, is intended to or shall confer upon any Person (other than the Parties) any right, benefit or remedy of any nature. This Agreement is intended to create a contractual relationship between the Investor and Parent and is not intended to create, and does not create, any agency, partnership, joint venture or any like relationship among the Parties. Without limiting the generality of the foregoing, neither the Investor nor Parent, by entering into this Agreement, intends to form a “group” for purposes of Rule 13d-5(b)(1) of the Exchange Act or any other similar provision of applicable Law with Parent or any other shareholder of the Company.

Section 7.10       Severability. If any term or provision of this Agreement is held by a court of competent jurisdiction or Governmental Entity to be invalid, void or unenforceable in any situation in any jurisdiction, such holding shall not affect the validity or enforceability of the remaining terms and provisions of this Agreement or the validity or enforceability or application of the invalid or unenforceable term or provision in any other situation or in any other jurisdiction. If a final judgment of a court of competent jurisdiction declares that any term or provision of this Agreement is invalid or unenforceable, the Parties agree that the court making such determination shall have the power to limit such term or provision, to delete specific words or phrases or to replace such term or provision with a suitable and equitable term or provision that is valid and enforceable and that comes closest to expressing the intention of the invalid or unenforceable term or provision, and this Agreement shall be valid and enforceable as so modified. In the event such court does not exercise the power granted to it in the prior sentence, the Parties agree to replace such invalid or unenforceable term or provision with a valid and enforceable term or provision that will achieve, to the extent possible, the economic, business and other purposes of such invalid or unenforceable term or provision.

Section 7.11       Certain Interpretations. For purposes of this Agreement:

(a)         Unless otherwise specified, all references in this Agreement to Articles and Sections shall be deemed to refer to Articles and Sections of this Agreement.

(b)         The Article and Section captions herein are for convenience of reference only, do not constitute part of this Agreement and shall not be deemed to limit or otherwise affect any of the provisions hereof.

(c)         Unless the context otherwise requires, words describing the singular number shall include the plural and vice versa, and words denoting any gender shall include all genders.

(d)         The words “include,” “includes” and “including,” when used herein shall be deemed in each case to be followed by the words “without limitation.”

(e)         The Parties agree that they have been represented by legal counsel during the negotiation and execution of this Agreement and, therefore, waive the application of any Law or rule of construction providing that ambiguities in an agreement or other document shall be construed against the Party drafting such agreement or document.

(f)          “Affiliate” means, with respect to any specified Person, any Person that directly, or indirectly through one or more intermediaries, controls, or is controlled by, or is under common control with, the Person specified.

(g)         “Permitted Transferee” means, with respect to the Investor (including any Permitted Transferee), any immediate family member of the Investor, any trust, partnership, corporation, limited liability company or other entity of which the beneficiaries or beneficial owners, as the case may be, are the Investor or Permitted Transferees, a trust or other entity for the benefit of any Person that is qualified as a charitable organization under Section 501(c)(3) of the Code, or a family foundation established by or on behalf of the Investor for the purpose of making charitable gifts or donations to Persons that are qualified as charitable organizations under Section 501(c)(3) of the Code.

(h)         “Representative” means, with respect to any Person, any director, officer, other employee, accountant, consultant, legal counsel, financial advisor, agent or other representative of such Person.

Section 7.12         Ownership Interest. Nothing contained in this Agreement shall be deemed to vest in Parent any direct or indirect ownership or incidence of ownership of or with respect to any Investor Owned Shares. All rights, ownership and economic benefits of and relating to the Investor Owned Shares shall remain vested in and belong to the Investor, and Parent shall have no authority to direct the Investor in the voting or disposition of any of the Investor Owned Shares, except as otherwise provided in this Agreement.

[Signature Page Follows]

IN WITNESS WHEREOF, the Parties have caused this Agreement to be duly executed, as of the date first above written.

PARENT:

BLUE EAGLE HOLDINGS, L.P.

By:

Name: 

Title:

INVESTOR:

Address:

Facsimile:

Spousal Consent to Subscription and Support Agreement

The undersigned (a) understands that, pursuant to the provisions of the Subscription and Support Agreement (the “Agreement”) to which this Spousal Consent is attached, _____________________ has agreed not to tender the Investor Owned Shares in the Offer and, upon the terms and subject to the conditions of the Agreement, to contribute and deliver to Parent all of the Investor Owned Shares, (b) understands that she may have a community property or other interest in the Investor Owned Shares, and (c) consents to such non-tender provisions and the Subscription and agrees to be bound by each and every provision of the Agreement. Capitalized terms used in this Spousal Consent and not otherwise defined herein shall have the meanings ascribed to them in the Agreement.

Schedule I

Investor Investor Owned Shares Purchased Units

Exhibit A

Form of Amended and Restated Limited Partnership Agreement

[Incorporate by reference to Exhibit B to Exhibit 10.2 to the Current Report on Form 8-K
of Innotrac Corporation filed on November 15, 2013]