ASSET PURCHASE AGREEMENT

 

This ASSET PURCHASE AGREEMENT (the "Agreement"') is made as of 23 April, 2014,
by and among Ubiquity Broadcasting Corporation, Inc., a Nevada corporation (the
"Buyer"), and Monkeybars Inc, a Washington corporation, with offices located in
California (the "Seller"). Certain other capitalized terms used in this
Agreement are defined in Exhibit A attached hereto.

 

RECITALS:

 

WHEREAS, Seller owns Monkeybars, a music platform that combines a cloud content
storage, a sharing application, and social networking search technology (the
“Business”);

 

WHEREAS, Buyer desires to purchase and Seller desires to sell to Buyer
substantially all of the assets of the Business, subject to the terms and
conditions of this Agreement.

 

AGREEMENT

 

NOW, THEREFORE, in consideration of the terms, covenants, and conditions
hereinafter set forth, the parties hereto agree as follows:

 

ARTICLE I

 

ASSETS BEING PURCHASED; ASSUMPTION OF LIABILITIES

 

1.1           Purchased Assets. Buyer hereby agrees to purchase from Seller, and
Seller hereby agrees to sell, convey, transfer and assign to Buyer, at the
Closing (as hereinafter defined), all of Seller’s right, title and interest in
and to all of the assets of Seller used in connection with the Business,
(collectively, the “Purchased Assets”), free and clear of all Encumbrances. The
Purchased Assets shall include, but not be limited to, the following:

 

(a)          All of the Sellers’ accounts or notes receivable directly related
to the Business, and all schedules, records and other documentation related to
such accounts or notes receivable, including, without limitation, all notes,
chattel paper or other documents or instruments evidencing the payment
obligations of the account or note debtors;

 

(b)          All of the tangible and intangible property, and associated
intellectual property rights owned by Seller and used in connection with the
conduct of the Business, all of which shall be identified in the asset schedule
to be attached hereto as Schedule 1.1(b) (the “Assets”);

 

(c)          With the exception of personnel records regarding employees (except
as may be waived in writing by employee) Seller’s books and records directly
related to or used exclusively in connection with the conduct of the Business or
directly pertaining to the Purchased Assets, regardless of the medium on which
such information is stored or maintained including, without limitation, all
customer and employment records, vendor information, business plans, strategies
and marketing information (except that Seller may retain copies as required by
law or as may be reasonably necessary or prudent business practice);

 

 

 

 

(d)          To the extent transferable, the Licenses and Permits required under
all laws, rules and regulations applicable to or affecting the Business, all of
which are set forth on Schedule 1.1(d);

 

(e)          All inventory of the Seller, a list of which shall be set forth on
Schedule 1.1(e);

 

(f)          The Intellectual Property Rights of the Seller listed on
Schedule 3.6(a) and any and all other Intellectual Property Rights of Seller
relating to the Business, whether or not disclosed on Schedule 3.6(a) (the
“Business Intellectual Property Rights”), including all proprietary knowledge,
Trade Secrets, Confidential Information, computer software and licenses,
patents, copyrights, formulae, designs and drawings, quality control data,
processes (whether secret or not), methods, inventions, Product manuals and
other similar know-how or rights used in the conduct of the Seller's business,
including the areas of software development, manufacturing, marketing,
advertising and personnel training and recruitment, together with all other
Intellectual Property Rights used in connection with the Seller's business,
including ail files, manuals, documentation and source and object codes related
thereto, in particular its source code to all products and services sold under
the "Monkeybars" trade names; all rights in and to the Seller's web site and the
content therein including the domain name registration Monkeybars, email
addresses, including all variations thereof; all rights of the Seller in and to
the names "Monkeybars" and all trade names, trademarks and logos used in the
Seller's business, all variants thereof and all goodwill associated therewith;

 

(g)          All advance payments, claims for refunds and deposits and other
prepaid items relating to the Purchased Assets;

 

(h)          All claims of Seller against third parties directly relating to the
Purchased Assets, whether choate or inchoate, known or unknown, contingent or
non-contingent;

 

(i)          All Seller’s Intellectual Property rights, Marks, access rights,
Inventory, and assets relating to advertising, marketing, sales, social
networking and other promotional activities, including, but not limited to
brochures, pamphlets, artwork, copy, know-how, access codes and passwords; and

 

(j)          The goodwill associated with the Purchased Assets and the Business.

 

1.2           Liabilities Not Being Assumed. Seller agrees that Buyer shall not
be obligated to assume or perform and is not assuming or performing any
liabilities or obligations of Seller, whether known or unknown, fixed or
contingent, certain or uncertain, and regardless of when such liabilities or
obligations may arise or may have arisen or when they are or were asserted (the
“Retained Liabilities”), and Seller shall remain responsible for all Retained
Liabilities, which shall include, without limitation, any and all of the
following obligations or liabilities of Seller:

 

(a)          Any compensation or benefits payable to present or past employees
of Seller arising in connection with their employment by Seller;

 

(b)          All federal, state, local, foreign or other taxes (i) that have
arisen prior to the Closing Date or may arise thereafter out of business or
other operations conducted by Seller either prior to or after the Closing Date,
(ii) that are imposed on the Purchased Assets as a result of the consummation of
the transactions set forth in this Agreement, or (iii) for which Seller is or,
at any time hereafter, may become liable, on or after the Closing Date, of the
Business, ship, on or after the Closing Date, of the Purchased Assets;

 

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(c)          All Encumbrances on any of the Purchased Assets and all obligations
and liabilities secured thereby;

 

(d)          All accounts or notes payable obligations for borrowed money, all
purchase money obligations, and any other indebtedness or payment obligations of
Seller (the “Retained Debt”);

 

(e)          Any claims, demands, actions, suits or legal proceedings that have
been asserted or threatened prior to the Closing Date against Seller, the
Business or the Purchased Assets or which may be asserted or threatened
hereafter against the Purchased Assets, the Business or the Buyer that arises in
any way from or in connection with (i) Seller’s operation of the Business prior
to the Closing Date, or (ii) any other business or non-business activities of
Seller conducted prior hereto or hereafter; and

 

(f)          Any obligations under any employment, consulting or non-competition
agreement to which Seller is a party, whether written or oral, and any
liabilities or obligations arising out of the termination by Seller of any of
its employees in anticipation or as a consequence of, or following, consummation
of the transactions contemplated hereby.

 

ARTICLE II

 

PURCHASE PRICE AND ALLOCATION OF PURCHASE PRICE

 

2.1           Purchase Price. On the Closing Date and upon full and complete
delivery of all of the assets, as consideration for the sale to Buyer of the
Purchased Assets,  Seller entering into the covenant not to compete set forth in
Section 5.4 below, the Buyer shall issue to Seller 1,092,233 shares (the
“Shares”), which the parties agree shall have an aggregate value of $2,250,000
(TWO MILLION TWO HUNDRED AND FIFTY THOUSAND DOLLARS) of Restricted Common Stock
of Buyer, based upon an market per Share price at the date of this Agreement of
$2.06 (TWO DOLLARS AND SIX CENTS).

 

2.2           Issuance of Restricted Shares. The Shares issued pursuant to
Section 2.1 above shall be issued pursuant to a private placement transaction
and are not being registered under the Securities Act of 1933, as amended (the
“Securities Act”), or any applicable state securities laws. Accordingly, the
Shares are subject to certain restrictions on transferability. All Shares will
be duly authorized, validly issued, fully paid and nonassessable.

 

2.3           Lock-up Restrictions. Except as otherwise expressly provided
herein, and except as Seller may be otherwise restricted from selling shares of
Restricted Common Stock under applicable federal or state securities laws, rules
and regulations and Securities and Exchange Commission (the “SEC”)
interpretations thereof, Seller may only publicly sell Restricted Common Stock
subject to the following conditions, commencing on the execution and delivery of
this Agreement:

 

(a)          The Seller shall not be allowed to sell any shares of Restricted
Common Stock for twelve (12) months (the “Lock-Up Period”);

 

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(b)          The transfer records of the Buyer’s transfer agent shall reflect
such appropriate restrictions representing Restricted Common Stock covered
hereby.

 

(c)          The Seller agrees that they will not engage in any short selling of
Buyer’s Restricted Common Stock during the Lock-Up Period.

 

2.4           Allocation of Purchase Price. Seller and Buyer agree that the
Purchase Price shall be allocated among the Purchased Assets and for the
covenant not to compete set forth in Section 5.4 below within 3 years after the
Closing Date, and at such time shall be attached hereto as Exhibit B (the
“Purchase Price Allocation”). Each of the parties, when reporting the
transactions consummated hereunder in their respective tax returns, shall
allocate the Purchase Price paid or received, as the case may be, in a manner
that is consistent with the Purchase Price Allocation to be set forth in
Exhibit B hereto. Additionally, each of the parties will comply with, and
furnish the information required by Section 1060 of the Internal Revenue Code of
1986, as amended (the “Code”), and any regulations thereunder.

 

2.5           Third Party Consents. Notwithstanding anything to the contrary in
this Agreement, this Agreement shall not constitute an agreement to assign or
transfer any governmental approval, instrument, contract, lease, permit or other
agreement or arrangement, including the Assigned Contracts, or any claim, right
or benefit arising thereunder or resulting therefrom if an assignment or
transfer or an attempt to make such an assignment or transfer without the
consent of a third party would constitute a breach or violation thereof or
affect adversely the rights of the Buyer or the Seller, thereunder; and any
transfer or assignment to the Buyer by Seller, as applicable, of any interest
under any such instrument, contract, lease, permit or other agreement or
arrangement that requires the consent of a third party shall be made subject to
such consent or approval being obtained. In the event that any such consent or
approval is not obtained on or prior to the Closing Date, the Seller shall
continue to use their best efforts to obtain any such approval or consent after
the Closing Date as promptly as possible, and, regardless of whether such
approval or consent is ever obtained, Seller will cooperate with the Buyer in
any lawful and reasonable arrangement to provide that the Buyer shall receive
the interest of the Seller in the benefits under (and Buyer shall perform the
obligations under, except as specifically prohibited) any such instrument,
contract, lease, or permit or other agreement or arrangement.

 

ARTICLE III

 

REPRESENTATIONS AND WARRANTIES OF SELLER

 

Subject to the disclosures and exceptions set forth in the disclosure schedules
attached hereto (the “Seller’s Disclosure Schedules”), the Seller make the
representations and warranties set forth hereinafter in this Section 3 to the
Buyer:

 

3.1           Authority and Binding Effect. Seller has the full power and
authority to execute and deliver this Agreement and the Bill of Sale (as
hereinafter defined). This Agreement and the Bill of Sale and the consummation
by Seller of its obligations contained herein and therein have been duly
authorized by all necessary corporate actions of Seller, and such agreements
have been duly executed and delivered by Seller.

 

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This Agreement is a valid and binding agreement of Seller, enforceable against
Seller in accordance with its terms, and, upon execution and delivery, the Bill
of Sale will be a valid and binding agreement of Seller and shall be enforceable
against it in accordance with its terms, except as enforceability of the
obligations of Seller under this Agreement and the Bill of Sale may be limited
by (i) bankruptcy, insolvency, moratorium or other similar laws affecting
creditors’ rights generally, and (ii) general principles of equity relating to
the availability of equitable remedies (whether such agreements are sought to be
enforced in a proceeding at law or a proceeding in equity). It is not necessary
for Seller to take any action or to obtain any approval, consent or release by
or from any third person, governmental or other, to enable Seller to enter into
or perform its obligations under this Agreement and the Bill of Sale.

 

3.2           Organization and Standing. Seller is corporation duly organized,
validly existing and in good standing under the laws of the Nevada, and Seller
is qualified to do business in each jurisdiction where such qualification is
necessary and where the failure to be so qualified would have a Material Adverse
Effect on Seller. Seller has the requisite corporate power and authority to
conduct its business as now conducted and to own or lease the Purchased Assets,
and to use such Purchased Assets in the conduct of its business. True and
complete copies of the organizational documents of Seller have been delivered to
Buyer. Seller is not in violation of its organizational documents. Seller has no
subsidiaries.

 

3.3           Financial Statements. Seller has delivered to the Buyer financial
statements of Seller consisting of unaudited balance sheets as of the end of,
and the related statements of income and cash flows for, the fiscal year ended
December 31, 2013, and an unaudited balance sheet and related statement of
income and cash flows for the period beginning January 1, 2014 and ending March
31, 2014 (collectively, the “Financial Statements”). True and correct copies of
the Financial Statements are attached hereto as Schedule 3.3. The Financial
Statements were prepared in accordance with Seller’s normal accounting
practices, and fairly and accurately reflect, on a cash basis, the results of
its operations as of the relevant dates thereof and for the respective periods
covered thereby. Seller has no debts, obligations or liabilities, fixed or
contingent, of a nature that would be required, in accordance with the Seller’s
normal accounting practices, to be shown on a balance sheet and that are not
shown on the balance sheet as of March 31, 2014 (the “Balance Sheet”), other
than liabilities incurred after March 31, 2014 in the ordinary course of
Seller’s business and consistent with past practice.

 

3.4           Absence of Certain Changes. Except as set forth in Schedule 3.4,
since January 1, 2014, there has not been:

 

(a)          except in the ordinary course of Seller’s business, any sale,
transfer, or other disposition of, or the incurrence or imposition of any
Encumbrance of any kind on or affecting, any of the Purchased Assets;

 

(b)          any material damage, destruction or loss, whether or not covered by
insurance, of any of the Purchased Assets;

 

(c)          the entry or violation of any judgment, order, writ or decree that
has had or could reasonably be expected to have a Material Adverse Effect on
Seller;

 

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(d)          any material default or breach by Seller or any amendment,
termination or revocation or, to the Knowledge of Seller, any material default
or breach by any party other than Seller, or any written threatened termination
or revocation of, any of the Assigned Contracts;

 

(e)          any actual or threatened amendment, termination or revocation of
any license, permit or franchise required for the continued operation of the
Business; or

 

(f)          the occurrence of any other event or circumstance which has or is
likely to have a Material Adverse Effect on Seller.

 

3.5           Title to and Condition of Purchased Assets.

 

(a)          Intangible Assets. The Intangible Assets perform in the manner
described and are in good working order and condition, free of trojans or
viruses of any kind or nature and have been properly maintained, are suitable
for the uses for which they are being utilized in the Business, do not require
more than regularly scheduled maintenance in the ordinary course, consistent
with Seller’s established maintenance policies, to keep them in good operating
condition and comply with all requirements under applicable laws, regulations
and licenses which govern the use and operation thereof.

 

(b)          Title to and Adequacy of Purchased Assets. Except as disclosed on
Schedule 3.5 hereto, Seller has, and on the Closing Date will convey and
transfer to Buyer, good, complete and marketable title to all of the Purchased
Assets, free and clear of all Encumbrances of any nature whatsoever other than
restrictions on transfer of Assigned Contracts. Except as set forth on Schedule
3.5, all of the Purchased Assets are in the exclusive possession and control of
Seller and Seller has the unencumbered right to use, and to sell to Buyer in
accordance with the terms and provisions of this Agreement, all of the Purchased
Assets without interference from and free of the rights and claims of others.
The Purchased Assets constitute all of the assets, properties, rights,
privileges and interest which Seller either owns or controls, or uses or holds
for use exclusively in connection with the Business and, except as set forth on
Schedule 3.5, the Purchased Assets constitute all of the assets, properties,
rights and interests of Seller which are necessary for Buyer to own and operate
the Business as currently conducted and as proposed to be conducted.

 

3.6           Intellectual Property.

 

(a)          Set forth on Schedule 3.6(a) is a complete list of all Intellectual
Property Rights, owned, licensed or used by the Seller in connection with the
Business, identifying for each registered Intellectual Property Right, or
pending registration, (i) whether it is owned by or licensed to the Seller, (ii)
the name of the applicant/registrant and current owner, (iii) the jurisdiction
where the application/registration is located, (iv) the application or
registration number, and (v) the filing date and issue date, if applicable.
Seller owns all right, title and interest in and to all Business Intellectual
Property Rights free and clear of all Encumbrances.

 

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(b)          No claims have been asserted or threatened against Seller by any
person challenging Seller’s ownership, use or distribution of any Business
Intellectual Property Rights or challenging or questioning the validity or
effectiveness of any license or agreement relating thereto and Seller has never
been a party to any action or proceeding that involves or involved any claim of
infringement, misappropriation or other wrongful use or exploitation of the
intellectual property or other proprietary rights of any other party. The
operation of the Business as currently and formerly conducted and proposed to be
conducted, does not violate, has not violated, and will not violate any
Intellectual Property Rights of any third party, including, without limitation,
infringement, misappropriation or wrongful use or exploitation of intellectual
property or other proprietary rights, and no third party has provided notice to
Seller of a possible such violation. Seller is not aware of any valid basis for
any claim of the type specified in this Section 3.6(b). To Seller’s Knowledge,
no third party is violating, infringing, or misappropriating any Business
Intellectual Property Right.

 

(c)          No registered Mark identified in Schedule 3.6(a) has been or is now
involved in any opposition or cancellation proceeding and, to the Knowledge of
the Seller, no such proceeding is or has been threatened with respect to any of
such Marks. No Patent identified on Schedule 3.6(a) has been or is now involved
in any interference, reissue or reexamination proceeding and, to the Knowledge
of the Seller, no such proceeding is or has been threatened with respect thereto
any of such Patents.

 

(d)          The Seller exclusively owns, free and clear of any and all
Encumbrances, all Intellectual Property Rights identified on Schedule 3.6(a) and
all other Business Intellectual Property Rights, except for Intellectual
Property Rights that are licensed to the Seller by a third party licensor
pursuant to a written license agreement that remains in effect. The Seller has
not received any notice or claim challenging its ownership of any of the
Business Intellectual Property Rights owned (in whole or in part) by the Seller,
nor to the Knowledge of the Seller, is there a reasonable basis for any claim
that it does not so own any of such Seller Intellectual Property.

 

(e)          The Seller has taken all reasonable steps in accordance with
standard industry practices to protect its rights in the Business Intellectual
Property Rights and at all times has maintained the confidentiality of all
information that constitutes or constituted a Trade Secret included therein. All
Business Intellectual Property Rights which the Seller purports to own were
developed by (i) an employee of Seller working within the scope of his or her
employment at the time of such development, or (ii) agents, consultants,
contractors or other Persons who have executed appropriate instruments of
assignment in favor of the Seller as assignee that have conveyed to the Seller
ownership of all Intellectual Property Rights in the Business Intellectual
Property Rights. To the extent that any Business Intellectual Property Rights
have been developed or created by a third party for the Seller, the Seller has a
written agreement with such third party with respect thereto and the Seller
thereby has obtained ownership of and is the exclusive owner of all of such
third party’s Intellectual Property Rights in such work, material or invention
by operation of law or by valid assignment.

 

(f)          All registered Business Intellectual Property Rights are valid,
subsisting and enforceable, and the Seller has not received any notice or claim
challenging the validity or enforceability of any registered Business
Intellectual Property Rights or alleging any misuse of such registered Business
Intellectual Property Rights. The Seller has not taken any action or failed to
take any action that could reasonably be expected to result in the abandonment,
cancellation, forfeiture, relinquishment, invalidation or unenforceability of
any of the registered Business Intellectual Property Rights (including the
failure to pay any filing, examination, issuance, post registration and
maintenance fees, annuities and the like and the failure to disclose any known
material prior art in connection with the prosecution of patent applications).

 

(g)          The Seller has not transferred ownership of, or granted any
exclusive license with respect to, any Business Intellectual Property Rights.
Upon the consummation of the Closing, the Buyer shall succeed to all of the
Seller’s rights and interest in or under all Business Intellectual Property
Rights. To Seller’s Knowledge, no loss or expiration of any of the Business
Intellectual Property Rights is threatened, pending or reasonably foreseeable.

 

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(h)          Except as specified in Schedule 3.6(h) of the Seller’s Disclosure
Schedule, none of the proprietary Software of the Seller or any Software
licensed to the Seller to which the Seller has made modifications, including
customizations, or any portion thereof (“Seller Proprietary Software”) contains,
is based on or derived from, was developed using or with reference to, or is
distributed or linked (statically or dynamically) with any Open Source Software.
None of the Seller Proprietary Software (or any portion, code or version thereof
or rights thereto) is required or will be required to be licensed, distributed
or otherwise made available under any terms and conditions applicable to such
Open Source Software.

 

(i)          Seller warrants that for a period of 1 year from the execution and
delivery of this Agreement: (i) the Software furnished will be free of defects
in materials and workmanship under normal use; and (ii) the Software
substantially conforms to its published specifications. Buyer’s exclusive remedy
and the entire liability of Seller and its suppliers under this warranty will be
either repair or replacement of the Software within a commercially reasonable
time. Seller warrants that the Software is error free and that Buyer will be
able to operate the Software without problems or interruptions.

 

(j)          To the Knowledge of the Seller, none of the Software (including
firmware and other software embedded in hardware devices) owned, developed,
used, marketed, distributed, licensed, or sold by the Business (including any
software that is part of, is distributed with, or is used in the design,
development, manufacturing, production, distribution, testing, maintenance, or
support of any Seller product, but excluding any third-party software that is
generally available on standard commercial terms and is licensed to the Seller
solely for internal use on a non-exclusive basis) (collectively, “Seller
Software”) (i) contains any bug, defect, or error (including any bug, defect, or
error relating to or resulting from the display, manipulation, processing,
storage, transmission, or use of date data) that materially and adversely
affects the use, functionality, or performance of Seller product or any third
party product or system containing or used in conjunction with such Seller
Software; or (ii) fails to comply with any applicable warranty or other
contractual commitment in any material respect relating to the use,
functionality, or performance of such Seller Software.

 

(k)          To the Knowledge of the Seller, no Seller Software contains any
“back door,” “drop dead device,” “time bomb,” “Trojan horse,” “virus,” or “worm”
(as such terms are commonly understood in the software industry) or any other
code designed or intended to have, or capable of performing, any of the
following functions: (a) disrupting, disabling, harming, or otherwise impeding
in any manner the operation of, or providing unauthorized access to, a computer
system or network or other device on which such code is stored or installed; or
(b) damaging or destroying any data or file without the user’s consent.

 

(l)          The source code for all Seller Software contains clear and accurate
annotations and programmer’s comments, and otherwise has been documented in a
professional manner that is both: (i) consistent with customary code annotation
conventions and best practices in the software industry; and (ii) sufficient to
independently enable a programmer of reasonable skill and competence to
understand, analyze, and interpret program logic, correct errors and improve,
enhance, modify and support the Seller Software. No source code for any Seller
Software has been delivered, licensed, or made available to any escrow agent or
other Person who is not, as of the date of this Agreement, an employee of the
Seller. The Seller has no duty or obligation (whether present, contingent, or
otherwise) to deliver, license, or make available the source code for any Seller
Software to any escrow agent or other Person. No event has occurred, and no
circumstance or condition exists, that (with or without notice or lapse of time)
will, or could reasonably be expected to, result in the delivery, license, or
disclosure of the source code for any Seller Software to any other Person.

 

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(m)          The Business Intellectual Property Rights and any common law rights
that have accrued to Seller constitute all of the Intellectual Property Rights
necessary for the conduct of the Business as presently conducted, and proposed
to be conducted, by Seller.

 

3.7           Assigned Contracts and Other Agreements. Schedule 3.7 hereto
contains an accurate and complete list of each material contract, agreement,
indenture, note, lease, or other instrument or commitment, written or oral,
which relates to or affects or could be reasonably likely to affect any of the
Purchased Assets, the Assumed Obligations or the consummation of the
transactions contemplated by this Agreement (the “Material Contracts”). Accurate
and complete copies of all of the Material Contracts have been furnished by
Seller to the Buyer. The Material Contracts include, without limitation, each of
the Assigned Contracts. Each of the Material Contracts is a valid and binding
obligation of Seller and, to Seller’s Knowledge, the other parties thereto,
enforceable in accordance with its terms, except as may be affected by
bankruptcy, insolvency, moratorium or similar laws affecting creditors’ rights
generally and general principles of equity relating to the availability of
equitable remedies. There have not been any defaults by Seller or, to the
Knowledge of Seller, defaults or any claims of default or claims of
nonenforceability by the other party or parties under or with respect or any of
Material Contracts which, individually or in the aggregate, would have a
Material Adverse Effect on Seller, and to the Knowledge of Seller, there are no
facts or conditions that have occurred or, as to assignability, except for the
transaction contemplated by this Agreement, that are anticipated to occur which,
with the passage of time or the giving of notice, or both, would constitute a
default by Seller, or to the Knowledge of Seller, by the other party or parties,
under any of the Material Contracts or would cause a creation or imposition of
any Encumbrance upon any of the Purchased Assets or otherwise would have a
Material Adverse Effect on Seller. Except as described on Schedule 3.7, none of
the Assigned Contracts contains any provisions which, after the date hereof,
would (i) hinder or prevent Buyer from continuing to use any of the assets or
property, tangible or intangible, that are the subject of the Assigned Contracts
in the manner in which they are currently used, or (ii) impose any additional
costs (other than scheduled fee increases) or burdensome requirements as a
condition to their continued use which are not currently in effect.

 

3.8           Conflicts. Neither the execution and delivery of nor the
consummation of the transactions contemplated by this Agreement or the Bill of
Sale will or could result in any of the following: (a) a default or an event
that, with notice or lapse of time, or both, would be a default, breach or
violation of the Operating Agreement or other governing instruments of Seller,
or of any Assigned Contract; (b) the creation or imposition of any Encumbrance
on any of the Purchased Assets; (c) the violation or breach of any writ,
injunction or decree that would become or is now applicable to or binding on any
of the Purchased Assets; (d) a loss or adverse modification of any license,
franchise, permit or other authorization or right (contractual or other) to
operate Seller’s Business or to own any of the Purchased Assets, granted to or
otherwise held by Seller or used in its Business, which would have a Material
Adverse Effect on the Business; (e) the right to cease or terminate any other
business relationship or arrangement between Seller and any third party that
would have a Material Adverse Effect on the Business; (f) the right to terminate
any Assigned Contract, or the acceleration of the maturity of any indebtedness
or other obligation of Seller, or (g) 

 

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3.9           Compliance with Law/Permits. Seller is in material compliance with
all, and is not in violation of any, laws, ordinances, orders, decrees, rules or
regulations of any governmental agency or authority. No (i) charges of
violations of laws or regulations relating to its Business have been made or, to
Seller’s Knowledge, threatened, (ii) proceedings or investigations relating to
its Business are pending or, to Seller’s Knowledge, have been threatened, and
(iii) citations or notices of deficiency have been issued or, to Seller’s
Knowledge, have been threatened, against Seller relating to or arising out of
its Business by any governmental authorities, which has had or could reasonably
be expected to have, individually or in the aggregate, a Material Adverse Effect
on Seller; and, to Seller’s Knowledge, there are no facts or circumstances upon
which any such charges, proceedings, investigations, or citations or deficiency
notices, reasonably may be instituted, issued or brought hereafter.

 

3.10         Litigation and Proceedings. Except as set forth on Schedule 3.10,
there is no action, suit, proceeding or investigation, or any counter or
cross-claim in an action brought against, by or on behalf of Seller, whether at
law or in equity, or before or by any governmental department, commission,
board, bureau, agency or instrumentality, domestic or foreign, or before any
arbitrator of any kind, that is pending or, to Seller’s Knowledge, threatened,
which (i) could reasonably be expected to affect adversely Seller’s ability to
perform its obligations under this Agreement, or the Bill of Sale or complete
any of the transactions contemplated hereby or thereby, or (ii)  which may
become a claim, or liability against Buyer or the Purchased Assets. To Seller’s
Knowledge, there are no facts or circumstances that could reasonably be expected
to give rise to any actions of the type set forth in this Section 3.13. Seller
is not subject to any judgment, order, writ, injunction, decree or award of any
court, arbitrator or governmental department, commission, board, bureau, agency
or instrumentality having jurisdiction over Seller, any of the Purchased Assets
or its Business that affects, involves or relates to the Purchased Assets.

 

3.11         Environmental and Safety Matters. Seller has complied with, and the
operation of its Business and the use ship of the Purchased Assets, are in
material compliance with all federal, state, regional and local statutes, laws,
ordinances, rules, regulations and orders relating to the protection of human
health and safety, natural resources or the environment, including, but not
limited to, air pollution, water pollution, noise control, on-site or off-site
hazardous substance discharge, disposal or recovery, toxic or hazardous
substances, training, information and warning provisions relating to toxic or
hazardous substances, and employee safety relating to its business or the
Purchased Assets (collectively the “Environmental Laws”); and no notice of
violation of any Environmental Laws or of any permit, license or other
authorization relating thereto has been received or threatened against Seller in
connection with its Business, and to the Knowledge of Seller, there is no
factual basis for the giving of any such notice. Seller has not received any
notice or claim to the effect that Seller or its Business is or may be liable to
any governmental authority or private party as a result of the release or
threatened release of any toxic or hazardous substances in connection with the
conduct or operation of its Business, and to Seller’s Knowledge, there are no
facts or circumstances that could reasonably be expected to give rise to such a
claim. None of the operations of Seller’s Business or Seller and none of the
Purchased Assets is the subject of any federal, state or local investigation
evaluating whether any remedial action is needed to respond to a release or a
threatened release of any toxic or hazardous substances at any real properties
leased, used or operated by Seller in connection with its Business or any other
operations or activities of Seller.

 

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3.12         Accounts Receivable. All accounts receivable of the Seller (a) are
valid, existing and collectible, without resort to legal proceedings or
collection agencies; (b) represent monies due for goods sold and delivered or
services rendered in each case in the ordinary course of business; and (c) are
current and will be collected in full (net of reserves set forth in the Balance
Sheet) when due and are not subject to any refund or adjustment or any defense,
right of set-off, assignment, restriction, security interest or other
Encumbrance. There are no disputes regarding the collectibility of any such
accounts receivable. All accounts receivable for customer collections and
billings prior to the Closing Date have been properly recorded on Seller’s books
and records on a timely basis and in the month in which Seller’s efforts and
activities generating such income were expended, and represent valid and
enforceable claims for completed sales made in the ordinary course of business.

 

3.13         Operational Restrictions. Seller’s Business is not subject to
(a) any restrictions under any applicable laws or regulations or (b) any charter
or other corporate or contractual restriction or (c) any judgment, order, writ,
injunction, decree or order, which has had or could reasonably be expected to
have a Material Adverse Effect on Seller.

 

3.14         No Broker. Seller has not retained or used the services of an
agent, finder or broker in connection with the transactions contemplated by this
Agreement. Seller shall pay, and shall indemnify, hold harmless and defend Buyer
from and against, all commissions, finder’s and other fees and expenses charged
or asserted by any agent, finder or broker, by reason of any such retention or
use of the services of any such agent, finder or broker by Seller. .

 

3.15         Investment Representations and Warranties. Seller (each an
“Investor” for purposes of this Section 3.18 only) each represent and warrant to
Buyer, with respect to its investment in, and receipt of, the Shares hereunder,
that:

 

(a)          The Investor is investing in the Common Stock for its own account
and not with a present view toward the public sale or distribution thereof,
except pursuant to sales registered or exempted from registration under the
Securities Act.

 

(b)          The Investor is an “accredited investor” as defined in Rule 501(a)
of Regulation D, promulgated under the Securities Act.

 

(c)          The Investor understands that the Common Stock is being offered and
sold to it in reliance upon specific exemptions from the registration
requirements of United States federal and state securities laws and that Buyer
is relying upon the truth and accuracy of, and the Investor’s compliance with,
the representations, warranties, agreements, acknowledgments and understandings
of the Investor set forth herein in order to determine the availability of such
exemptions and the eligibility of the Investor to acquire the Common Stock.

 

(d)          The Investor and its advisors, if any, have been furnished with all
materials relating to the business, finances and operations of Buyer, and
materials relating to the offer and sale of the Common Stock, that have been
requested by the Investor or its advisors, if any. The Investor and its
advisors, if any, have been afforded the opportunity to ask questions of Buyer.
The Investor acknowledges and understands that its investment in the Common
Stock involves a significant degree of risk.

 

(e)          The Investor understands that no United States federal or state
agency, or any other government or governmental agency, has passed upon or made
any recommendation or endorsement of the Common Stock or an investment therein.

 

(f)          The Investor understands that:

 

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(i)          the Common Stock has not been, and is not being, registered under
the Securities Act or any applicable state securities laws and, consequently,
the Investor may have to bear the risk of owning the Common Stock for an
indefinite period of time because the Common Stock may not be transferred unless
(A) the resale of the Common Stock is registered pursuant to an effective
registration statement under the Securities Act, (B) the Investor has delivered
to the Company an opinion of counsel (in form, substance and scope customary for
opinions of counsel in comparable transactions) to the effect that the Common
Stock to be sold or transferred may be sold or transferred pursuant to an
exemption from such registration, (C) the Common Stock is sold or transferred
pursuant to Rule 144, promulgated under the Securities Act (“Rule 144”), or (D)
the Common Stock is sold or transferred to an affiliate (as defined in Rule 144)
of the Investor;

 

(ii)         any sale of the Common Stock made in reliance on Rule 144 may be
made only in accordance with the terms of Rule 144 and, if Rule 144 is not
applicable, any resale of the Common Stock under circumstances in which the
seller (or the person through whom the sale is made) may be deemed to be an
underwriter (as that term is defined in the Securities Act) may require
compliance with some other exemption under the Securities Act, or the rules and
regulations of the SEC thereunder; and

 

(iii)        neither Buyer nor any other person is under any obligation to
register the Common Stock under the Securities Act or any state securities laws
or to comply with the- terms and conditions of any exemption thereunder.

 

(g)          The Investor understands that until (a) the Common Stock may be
sold by the Investor under Rule 144 or (b) such time as the resale of the Common
Stock has been registered under the Securities Act, the certificates
representing the Common Stock will bear a restrictive legend in substantially
the following form (and a stop-transfer order may be placed against transfer of
the certificates for such Common Stock):

 

THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE OF
THE UNITED STATES. THE SECURITIES MAY NOT BE SOLD, TRANSFERRED OR ASSIGNED IN
THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER
APPLICABLE SECURITIES LAWS, OR UNLESS OFFERED, SOLD OR TRANSFERRED PURSUANT TO
AN AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THOSE LAWS.

 

3.16         Representations and Warranties of Seller. The representations and
warranties of Seller contained herein, and the disclosures contained in Seller’s
Disclosure Schedule, do not contain any statement of a material fact that was
untrue when made or omit any information necessary to make any such statement
contained therein, in light of the circumstances under which such statement was
made, not misleading. The copies of all documents furnished by Seller to Buyer
pursuant to the terms of this Agreement are complete and accurate copies of the
original documents.

 

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ARTICLE IV

 

REPRESENTATIONS AND WARRANTIES OF BUYER

 

The Buyer hereby makes the representations and warranties set forth in this
Section 4 to Seller:

 

4.1           Authority and Binding Effect. Buyer has the full corporate power
and authority to execute and deliver this Agreement and the Bill of Sale. This
Agreement and the Bill of Sale and the consummation by Buyer of its obligations
contained herein and therein have been duly authorized by all necessary
corporate actions of Buyer and such agreements have been duly executed and
delivered by Buyer. This Agreement is a valid and binding agreement of Buyer,
enforceable against Buyer in accordance with its terms, and, upon execution and
delivery, the Bill of Sale will be a valid and binding agreement of Buyer and
shall be enforceable against it in accordance with its terms, except as
enforceability of the obligations of Buyer under this Agreement and the Bill of
Sale may be limited by (i) bankruptcy, insolvency, moratorium or other similar
laws affecting creditors’ rights generally, and (ii) general principles of
equity relating to the availability of equitable remedies (whether such
agreements are sought to be enforced in a proceeding at law or a proceeding in
equity). It is not necessary for Buyer to take any action or to obtain any
approval, consent or release by or from any third person, governmental or other
entity, to enable Buyer to enter into or perform its obligations under this
Agreement and the Bill of Sale.

 

4.2           Organization and Standing. Buyer is a corporation duly organized
and validly existing under and is in good standing under the laws of the State
of Nevada. Buyer has requisite corporate power to own and operate its properties
and assets, and to carry on its business as presently conducted. Buyer is duly
qualified to do business and is in good standing in each jurisdiction in which
the character of the business conducted by it or the location of the properties
owned or leased by it make such qualification necessary, except for
jurisdictions in which the failure to so qualify would not have a Material
Adverse Effect on Buyer.

 

4.3           Compliance with Other Instruments. The execution and delivery of
this Agreement, the Bill of Sale and all other agreements to be entered into in
connection herewith and the consummation of the transactions contemplated hereby
and thereby will not conflict with or result in any violation of any law, rule,
regulation, judgment, order, decree or ordinance applicable to Buyer or its
properties or assets, or conflict with or result in any breach or default (with
or without notice or lapse of time, or both) under, or give rise to a right of
termination, cancellation or acceleration of any obligation or to loss of a
material benefit, under (i) any provision of the Certificate of Incorporation or
bylaws of Buyer; or (ii) any material agreement, contract, note, mortgage,
indenture, lease, instrument, permit, concession, franchise or license or any
writ, order or decree to which Buyer is a party or by which Buyer or any of its
property is bound.

 

4.4           Governmental Consent, etc. Except for filings, permits,
authorizations, consents and approvals as may be required under, and other
applicable requirements of, the Securities Act, and the rules and regulations
promulgated thereunder, or of any regulatory authority pursuant thereto, or of
any state securities or blue sky laws, no consent, approval, order or
authorization of, or registration, declaration or filing with, any governmental
entity is required by or with respect to Buyer in connection with the execution
and delivery of this Agreement or the consummation by Buyer of the transactions
contemplated hereby, except for such consents, approvals, orders,
authorizations, registrations, declarations and filings which if not obtained or
made would not have a Material Adverse Effect on Buyer.

 

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4.5           No Broker. Buyer has not retained or used the services of an
agent, finder or broker in connection with the transactions contemplated by this
Agreement. Buyer shall pay, and shall indemnify, hold harmless and defend Seller
from and against, all commissions, finder’s and other fees and expenses charged
or asserted by any agent, finder or broker, by reason of any such retention or
use of the services of any such agent, finder or broker by Buyer.

 

4.6           Representations and Warranties of Buyer. The representations and
warranties of Buyer contained herein do not contain any statement of a material
fact that was untrue when made or omits any information necessary to make any
such statement contained therein, in light of the circumstances under which such
statement was made, not misleading. The copies of all documents furnished by
Buyer to Seller pursuant to the terms of this Agreement are complete and
accurate copies of the original documents.

 

ARTICLE V

 

OBLIGATIONS SURVIVING THE CLOSING

 

5.1           Further Assurances. Each party hereto shall execute and deliver
after the date hereof and after Closing such instruments and take such other
actions as the other party may reasonably request in order to carry out the
terms, conditions and intent of this Agreement or to better evidence or
effectuate the transactions contemplated herein.

 

5.2           Expenses. Unless otherwise specifically provided for herein, each
party shall pay all of its respective costs and expenses incurred or to be
incurred by it in negotiating and preparing this Agreement and the other
agreements contemplated hereby, and in carrying out and closing the transactions
contemplated by this Agreement whether or not this Agreement or the transactions
contemplated hereby are ever consummated.

 

5.3           Taxes. Seller shall pay all Taxes of any kind or nature arising
from (i) the conduct or operation of its business up to the Closing Date and the
conduct or operation by Seller, prior to or after the Closing Date, of any other
business or business activities operations, (ii) the sale of the Purchased
Assets pursuant to this Agreement, (iii) a proportionate share of Taxes
attributable to the portion of any Straddle Period occurring on or before the
Closing Date, and (iv) any liquidation, partial or whole, of Seller. If any
Taxes required under this Section 5.3 to be borne by Seller are assessed against
the Buyer or any of the Purchased Assets, the Buyer shall notify Seller in
writing promptly thereafter and Seller shall be entitled to contest, in good
faith, such assessment or charge so long as such assessment does not cause a
Material Adverse Effect on Buyer or the Purchased Assets or the Buyer’s
business. Notwithstanding the foregoing, the Buyer may (but shall not be
obligated to) pay any such Taxes assessed against it, its business or any of the
Purchased Assets, but which are payable by Seller pursuant hereto, if the
Buyer’s failure to do so, in the reasonable judgment of the Buyer, could result
in the immediate imposition of an Encumbrance on any of the Purchased Assets or
any other assets of the Buyer or if Seller fails to contest such assessment or
charge diligently and in good faith. If in accordance with the immediately
preceding sentence, the Buyer pays any Taxes which pursuant hereto are required
to be borne by Seller, the Buyer shall be entitled to reimbursement thereof from
Seller in accordance with the indemnity provisions set forth in Article VIII
hereof.

 

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5.4           Non-Competition, Non-Solicitation and Confidentiality.

 

(a)          Noncompetition.

 

(i)          The Seller hereby acknowledge that (A) the Buyer conducts the
Business and/or has current plans to expand the Business throughout the
Territory and (B) to protect adequately the interest of the Buyer in the
business and goodwill of the Seller, it is essential that any noncompetition
covenant with respect thereto cover all of the Business and the entire
Territory.

 

(ii)         The Seller shall not , during the Noncompete Period, in any manner,
either directly, indirectly, individually, in partnership, jointly or in
conjunction with any Person (other than the Buyer or its affiliates), (A) engage
in the Business within the Territory, or (B) have an equity or profit interest
in, advise or render services (of an executive, marketing, manufacturing,
research and development, administrative, financial, consulting or other nature)
or lend money to any Person that engages in the Business within the Territory.

 

(b)          Nonsolicitation. The Seller shall not , during the Noncompete
Period, in any manner, directly, indirectly, individually, in partnership,
jointly or in conjunction with any Person, (i)(A) solicit any customer of the
Buyer who is or has been a customer on or prior to the Closing Date for the
purpose of providing, distributing or selling products or services similar to
those sold or provided by the Seller; or (B) persuade or attempt to persuade any
customer or supplier of the Buyer (or any of its affiliates) to terminate or
modify such customer’s or supplier’s relationship with the Buyer (or any of its
Affiliates), or (ii) solicit, recruit or hire, or take any other action that is
intended to solicit, recruit or hire, any person who is then an employee of the
Buyer (or who has been an employee of the Seller or the Buyer during the
preceding 24 months), or otherwise encourage, or take any action intended to
encourage, any person who is then an employee of the Buyer (or who has been an
employee of the Seller or the Buyer during the preceding 12 months) to terminate
his or her employment with the Buyer or devote less than all such employee’s
efforts to the affairs of the Buyer.

 

(c)          Severability. In the event a judicial or arbitral determination is
made that any provision of this Section 5.4 constitutes an unreasonable or
otherwise unenforceable restriction against the Seller , the provisions of this
Section 5.4 shall be rendered void only to the extent that such judicial or
arbitral determination finds such provisions to be unreasonable or otherwise
unenforceable with respect to the Seller. In this regard, any judicial authority
construing this Agreement shall be empowered to sever any portion of the
Territory, any prohibited business activity or any time period from the coverage
of this Section 5.4 and to apply the provisions of this Section 5.4 to the
remaining portion of the Territory, the remaining business activities and the
remaining time period not so severed by such judicial or arbitral authority.
Moreover, notwithstanding the fact that any provision of this Section 5.4 is
determined not to be specifically enforceable, the Buyer shall nevertheless be
entitled to recover monetary damages as a result of the breach of such provision
by the Seller. The time period during which the prohibitions set forth in this
Section 5.4 shall apply shall be tolled and suspended for a period equal to the
aggregate time during which the Seller violates such prohibitions in any
respect.

 

(d)          Injunctive Relief. Any remedy at law for any breach of the
provisions contained in this Section 5.4 shall be inadequate and the Buyer shall
be entitled to injunctive relief in addition to any other remedy the Buyer might
have hereunder.

 

15

 

 

(e)          Reasonable Restrictions. The Seller, as applicable,
(i) acknowledges that the duration, geographical scope and subject matter of
this Agreement are reasonable and necessary to protect the goodwill, customer
relationships, legitimate business interests, trade secrets and confidential and
proprietary information of the Business, (ii) acknowledges that the Buyer would
not enter into the transactions contemplated by this Agreement without the
benefits contained in this Section 5.4, (iii) represents that Seller will be
able to earn a satisfactory livelihood without violating this Section 5.4 of
this Agreement and (iv) understands that this Agreement is assignable by the
Buyer and shall inure to the benefit of its respective successors and assigns.

 

(f)          Confidentiality. After the Closing Date, Seller shall cause their
affiliates to treat and hold as confidential any information concerning the
Business of the Seller (including, without limitation, all Intellectual Property
Rights included in the Purchased Assets) that is not already generally available
to the public (the “Confidential Information”), refrain from using any of the
Confidential Information except in connection with this Agreement or as
otherwise required to comply with applicable law, and at any time upon the
reasonable request of the Buyer deliver promptly to the Buyer all tangible
embodiments (and, except as may be required to comply with applicable law, all
copies) of the Confidential Information which are included within the Purchased
Assets and which are in its possession or under its control following the
Closing Date. In the event that after the Closing Date Seller or any of their
affiliates, is requested or required (by oral question or request for
information or documents in any legal proceeding, interrogatory, subpoena, civil
investigative demand, or similar process or by any order of governmental entity)
to disclose any Confidential Information, the Seller, as applicable, shall
notify Buyer promptly of the request or requirement so that the Buyer may seek
an appropriate protective order or waive compliance with the provisions of this
Section 5.4(f). If, in the absence of a protective order or the receipt of a
waiver hereunder, Seller or any of their affiliates is, on the advice of
counsel, compelled to disclose any Confidential Information to any tribunal,
Seller or their affiliates, as applicable, may disclose the Confidential
Information to the tribunal; provided that such party shall use its best efforts
to obtain, at the request and sole cost and expense of the Buyer, an order or
other assurance that confidential treatment shall be accorded to such portion of
the Confidential Information required to be disclosed as the Buyer shall
designate.

 

5.5           “Market Stand-Off” Agreement. In connection with any underwritten
public offering by the Buyer of its equity securities pursuant to an effective
registration statement filed under the Securities Act, including the Buyer’s
initial public offering, the Seller, or a transferee shall not directly or
indirectly sell, make any short sale of, loan, hypothecate, pledge, offer, grant
or sell any option or other contract for the purchase of, purchase any option or
other contract for the sale of, or otherwise dispose of or transfer, or agree to
engage in any of the foregoing transactions with respect to, any Shares without
the prior written consent of the Buyer or its managing underwriter. Such
restriction (the “Market Stand-Off”) shall be in effect for such period of time
following the date of the final prospectus for the offering as may be requested
by the Buyer or such underwriter. In no event, however, shall such period exceed
180 days plus such additional period as may reasonably be requested by the Buyer
or such underwriter to accommodate regulatory restrictions on (a) the
publication or other distribution of research reports or (b) analyst
recommendations and opinions, including (without limitation) the restrictions
promulgated by the Financial Industry Regulatory Authority, Inc. In the event of
the declaration of a stock dividend, a spin off, a stock split, an adjustment in
conversion ratio, a recapitalization or a similar transaction affecting the
Buyers outstanding securities without receipt of consideration, any new,
substituted or additional securities which are by reason of such transaction
distributed with respect to any Shares subject to the Market Stand-Off, or into
which such Shares thereby become convertible, shall immediately be subject to
the Market Stand-Off. In addition, if reasonably requested by the Buyer or the
representative of the underwriters of Common Stock (or other securities) of the
Buyer, Seller, or a transferee shall provide, within ten (10) days of such
request, such information as may be required by the Buyer or such representative
in connection with the completion of any public offering of the Buyer’s
securities pursuant to a registration statement filed under the Securities Act.
In order to enforce the Market Stand-Off, the Buyer may impose stop-transfer
instructions with respect to the Shares acquired under this Agreement until the
end of the applicable stand-off period. The Company’s underwriters shall be
beneficiaries of the agreement set forth in this Section 5.6.

 

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ARTICLE VI

 

SURVIVAL OF REPRESENTATIONS AND WARRANTIES

 

All of the respective representations and warranties of Seller and the Buyer set
forth in this Agreement or in any of such party’s disclosure schedules, or in
any certificates delivered by such party on the Closing Date shall survive the
consummation of the transactions contemplated hereby for two (2) years;
provided, that (a) each of the representations and warranties contained in
Section 3.1 (Authority and Binding Effect) Section 3.2 (Organization and
Standing), Section 3.5 (Title to and Condition of Purchased Assets), Section 3.6
(Intellectual Property) shall survive shall survive the Closing until, and all
claims for indemnification in connection therewith shall be asserted not later
than sixty (60) days following, the expiration of any statute of limitations
applicable to the rights of any Person to bring any claim with respect to such
matters, and (b) any breach of any representation or warranty that constitutes
fraud, intentional misrepresentation or intentional breach, shall survive the
Closing without limitation. The covenants of any party hereto that cannot be or
are not fully performed by such party on or prior to the Closing Date shall
survive until they are otherwise terminated pursuant to their terms or fully
performed.

 

ARTICLE VII

 

THE CLOSING

 

7.1           Pre-Closing Contingencies. This Agreement is contingent upon
Buyer’s final inspection to its full satisfaction of all Purchased Assets within
30 calendar days from the date of this Agreement. Buyer shall be given access to
and have the right to inspect the Purchased Assets for a period of 30 calendar
days from date of this Agreement. If Buyer notifies Seller in writing, the
Purchased Assets are not conforming, in part or in full, to the Seller’s
Disclosure Schedules, then this Agreement shall be deemed canceled, null and
void.

 

7.2           Closing. Unless otherwise mutually agreed in writing between the
Buyer and the Seller, the consummation of the transactions contemplated by this
Agreement (the “Closing”) shall take place at the offices of Buyer upon
satisfaction of all contingencies in described in Section 7.1 (the “Closing
Date”), unless Buyer and Seller otherwise agree.

 

7.3           Seller Closing Deliveries. At the Closing, the Seller shall
deliver, or cause to be delivered, to the Buyer the following:

 

(a)          executed bills of sale, instruments of assignment and other
conveyance documents reasonably satisfactory to the Buyer, dated as of the
Closing Date, transferring to the Buyer all of the Seller’s right, title and
interest in and to the Purchased Assets, together with possession of the
Purchased Assets, including the bill of sale substantially in the form of
Exhibit C (the “Bill of Sale”);

 

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(b)          Any third party consents to the assignment of the Assigned
Contracts that are required under the terms of such Assigned Contracts;

 

(c)          Any documents requested by Buyer to evidence the transfer of
registered Intellectual Property Rights, for the purpose of recording the
transfer of any such Intellectual Property Rights; and

 

(d)          Such other executed instruments of assignment, certificates of
title documents, deeds and conveyance documents requested by and reasonably
satisfactory in form and substance to the Buyer, transferring to the Buyer all
of the Seller’s right, title and interest in and to the Purchased Assets,
together with possession of the Purchased Assets.

 

7.4           Buyer Closing Deliveries. At the Closing, the Buyer shall deliver,
or cause to be delivered, to the Seller the following:

 

(a)          An irrevocable instruction letter to the Buyer’s transfer agent,
instructing the transfer agent to issue the Shares to Seller in accordance with
the terms of this Agreement; and

 

(b)          The executed Bill of Sale.

 

ARTICLE VIII

 

INDEMNIFICATION

 

8.1           Obligations of Seller. Each of Seller hereby agrees that it will
indemnify, hold harmless and defend Buyer and each of its directors, officers,
members, employees and agents and the respective successors and assigns of Buyer
and such persons (all of the foregoing, collectively, the “Indemnified Parties”
or, individually, an “Indemnified Party”), from and against any and all Losses
(regardless of whether or not such Losses relate to any third party claim) that
arise from or in connection with the following prior to their expiration under
Article VI:

 

(a)          any breach of or inaccuracy (or any claim by any third party which,
if true, would constitute a breach) in any of the representations or warranties
of Seller contained in this Agreement or in Seller’s Disclosure Schedules or
other documents contemplated hereby;

 

(b)          any breach or default by Seller of any of its covenants or
agreements contained in this Agreement;

 

(c)          the failure by Seller to discharge when due any of the Retained
Liabilities;

 

(d)          the failure to have paid or to pay, when due, any Taxes that arose
out of the operations of Seller or the consummation of the transactions
contemplated by this Agreement or the failure to have filed, when due, any Tax
Returns related to any such Taxes or any period up to the Closing Date, whether
or not such failure constitutes a breach of the representations or warranties of
Seller contained in Section 3.12 or is disclosed in this Agreement or Seller’s
Disclosure Schedules; and

 

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(e)          Seller’s operation of the Business prior to the Closing Date.

 

8.2           Limitations on Obligations of Seller. In no event shall Seller
have any obligation to indemnify the Indemnified Parties for or in respect of
any of the Assumed Obligations identified in Schedule 3.7, and Buyer agrees to
indemnify, hold harmless and defend Seller (in the same manner and on the same
terms and conditions that are applicable to Seller ’s indemnification
obligations under this Article VIII) from any and all Losses incurred by Seller
as a result of (a) any failure by Buyer to pay or otherwise discharge, and from
any failure by Buyer to comply with the provisions of, any of the Assumed
Obligations after the Closing Date, and (b) any breach or default by Buyer of
any of its covenants or agreements, or any representations or warranty
hereunder.

 

8.3           Claims Procedure. Promptly after the receipt by any Indemnified
Party of notice of, or threat of, the commencement of any action or proceeding
against such Indemnified Party, such Indemnified Party shall, if a claim with
respect thereto is or may be made against any indemnifying party (the
“Indemnifying Party”) pursuant to this Article VIII, give such Indemnifying
Party written notice of the commencement of such action or proceeding and give
such Indemnifying Party a copy of such claim and/or process (or threat thereof)
and all legal pleadings in connection therewith. The failure to give such notice
shall not relieve any Indemnifying Party of any of its indemnification
obligations contained in this Article VIII, except where, and solely to the
extent that, such failure actually and prejudices the rights of such
Indemnifying Party. Except as provided in Section 8.5(a), such Indemnifying
Party shall have the right to defend, at his or its own expense and by his or
its own counsel reasonably acceptable to the Indemnified Party, any such matter
involving the asserted liability of the Indemnified Party; provided, however,
that the Indemnified Party shall have the right to participate in the defense or
such asserted liability at the Indemnified Party’s own expense. In any event,
the Indemnified Party, such Indemnifying Party and its counsel shall cooperate
in the defense against, or compromise of, any such asserted liability, and in
cases where the Indemnifying Party shall have assumed the defense, the
Indemnified Party shall have the right to participate in the defense of such
asserted liability at the Indemnified Party’s own expense. In the event that
such Indemnifying Party shall decline to participate in or assume the defense of
such action, in accordance with the provisions hereof, or if the Indemnifying
Party discontinues the diligent and timely conduct thereof, any of the
Indemnified Parties may undertake such defense and the Indemnifying Party shall
be responsible for reimbursing the Indemnified Parties for their reasonable
legal fees and expenses in connection therewith as and when such fees and
expenses are incurred by them. If the Indemnifying Party is defending the claim
as set forth above, the Indemnifying Party shall have the sole right to settle
the claim, subject to obtaining the consent of the Indemnified Party; provided,
however, that if the Indemnified Party shall fail to consent to the settlement
of such a claim by the Indemnifying Party, which settlement (i) the claimant has
indicated it will accept, and (ii) includes an unconditional release of the
Indemnified Party and by the claimant and imposes no restrictions on the future
activities of the Indemnified Party and its affiliates, the Indemnifying Party
shall have no liability with respect to any payment required to be made to such
claimant in respect of such claim. If the Indemnified Party is defending the
claim as set forth above, the Indemnified Party shall have the right to settle
or compromise any claim against it after consultation with, but without the
prior approval of, any Indemnifying Party, provided, however, that such
settlement or compromise shall not, unless consented to in writing by such
Indemnifying Party, which shall not be unreasonably withheld, be conclusive as
to the liability of such Indemnifying Party to the Indemnified Party.

 

19

 

 

8.4           Limitations on Liability.

 

(a)          Exclusive Remedy. Each of the parties hereto acknowledges and
agrees that, from and after the Closing Date, the Buyer’s sole and exclusive
monetary remedy with respect to any and all claims relating to the subject
matter of this Agreement shall be to make claims under this Article VIII.
Notwithstanding anything herein to the contrary, no breach of any
representation, warranty, covenant or agreement contained herein shall give rise
to any right on the part of Buyer, after consummation of the transactions
contemplated hereby, to rescind this Agreement or any of the transactions
herein, provided that nothing in this Agreement shall be deemed to constitute a
waiver of any injunctive or other equitable remedies or any tort claims for, or
causes of action arising from, intentionally fraudulent misrepresentation,
willful breach or deceit.

 

(b)          Buyer Investigation. The right to indemnification, reimbursement or
other remedy based upon Seller’s representations, warranties, covenants and
obligations herein shall not be affected by any investigation (including any
environmental investigation or assessment) conducted with respect to, or any
Knowledge acquired (or capable of being acquired) at any time, whether before or
after the execution and delivery of this Agreement or the Closing Date, with
respect to the accuracy or inaccuracy of or compliance with any such
representation, warranty, covenant or obligation.

 

8.5           Indemnification for Intellectual Property Infringement.

 

(a)          Seller will defend, at its expense, a third-party action, suit, or
proceeding against Buyer, and each of its directors, officers, members,
employees and agents and the respective successors and assigns of Buyer and such
persons (collectively referred to for purposes of this Section as “Infringement
Claim(s)”) to the extent such Infringement Claim is based upon an allegation
that Purchased Assets as of their delivery date under this Agreement, infringes
a valid Unites States patent or copyright or misappropriates a third-party trade
secret. Seller will indemnify Buyer, agents for any judgments, settlements and
reasonable attorney fees resulting from a Infringement Claim as provided in this
Section.

 

(b)          Buyer also agrees that, if the use or operation of the Purchased
Asset, or any part of them, becomes, or in Seller’s opinion is likely to become,
the subject of an Infringement Claim(s), Buyer will permit Seller, at Seller’s
option and expense for all associated costs, either to (1) procure the right for
Buyer to continue to use Purchased Assets; (2) modify them with another item of
comparable quality and performance capabilities to become non-infringing,
provided such replacement or modification does not cause the product, services
and/or deliverables, or any part thereof, to fail to comply with any of the
requirements of this Agreement, including but not limited to, all functionality,
technical specifications and performance warranties; or (3) at Buyer’s request,
accept the cancellation of infringing Purchased Assets without Buyer having any
cancellation liability and the return of the infringing Purchased Assets at
Seller’s expense and refund any amount paid.

 

(c)          In the event Buyer’s ongoing use of Purchased Asset’s, products,
services and/or deliverables, or any part of them, is the subject of an
Infringement Claim that would preclude or impair Buyer’s use of Purchased
Asset’s, (e.g., injunctive relief), or if Buyer’s continued use of them may
subject it to punitive damages or statutory penalties, Buyer shall give written
notice to Seller of such fact(s). Upon notice of such facts, Seller shall either
(1) procure the right for Buyer to continue to use the Purchased Assets,(2)
replace or modify the Purchased Assets, of comparable quality and performance
capabilities to become non-infringing; or (3) at Buyer’s request, accept the
cancellation of infringing Purchased Assets without Buyer having any
cancellation liability and the return of the infringing Purchased Assets at
Seller’s expense and refund any amount paid.

 

20

 

 

(d)          The foregoing remedies provided in this Section 8.5 are cumulative
and not exclusive of any other rights and remedies that may be available to the
Buyer, whether provided in by law, equity, statute, or in Section 8.1 of this
Agreement.

 

ARTICLE IX

 

MISCELLANEOUS

 

9.1           Assignment. Neither Seller nor Buyer may assign this Agreement, or
assign its rights or delegate its duties hereunder, without the prior written
consent of the other party hereto. This Agreement will be binding upon, inure to
the benefit of, and be enforceable by the parties and their respective
successors and assigns.

 

9.2           Severability. Any provision of this Agreement which is illegal,
invalid or unenforceable shall be ineffective to the extent of such illegality,
invalidity or unenforceability, without affecting in any way the remaining
provisions hereof.

 

9.3           Governing Law. This Agreement, its construction and the remedies
for its enforcement or breach are to be applied pursuant to, and in accordance
with, the laws of the State of California, United States of America without
regard to the principles of conflicts of law thereof.

 

9.4           Entire Agreement; Amendment. This Agreement and the Exhibits and
Schedules hereto, and each additional agreement and document to be executed and
delivered pursuant hereto, constitute all of the agreements of the parties with
respect to, and supersede all prior agreements and understandings relating to
the subject matter of, this Agreement or the transactions contemplated by this
Agreement. This Agreement may not be modified or amended except by a written
instrument specifically referring to this Agreement signed by the parties
hereto.

 

9.5           Waiver. No waiver by one party of the other party’s obligations,
or of any breach or default hereunder by any other party, shall be valid or
effective, unless such waiver is set forth in writing and is signed by the party
giving such waiver; and no such waiver shall be deemed a waiver of any
subsequent breach or default of the same or similar nature or any other breach
or default by such other party.

 

9.6           Interpretation; Headings. This Agreement is the result of
arms’-length negotiations between the parties hereto and no provision hereof,
because of any ambiguity found to be contained therein or otherwise, shall be
construed against a party by reason of the fact that such party or its legal
counsel was the draftsman of that provision. The section, subsection and any
paragraph headings contained herein are for the purpose of convenience only and
are not intended to define or limit or affect, and shall not be considered in
connection with, the interpretation of any of the terms or provisions of this
Agreement.

 

9.7           Counterparts. This Agreement may be executed in separate
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.

 

21

 

 

9.8           Notices. All notices, requests, demands or other communications
hereunder shall be in writing and shall be deemed to have been duly given to the
person designated below (i) on the date of delivery if delivered in person;
(ii) on the date of transmission by fax, provided that the successful
transmission of the fax has been confirmed through a confirmation function sheet
provided by the fax machine used for such transmission; (iii) on the third
business day following the deposit thereof in the United States Mail, provided
it is mailed by certified mail, return-receipt requested and postage prepaid and
properly addressed; or (iv) on the earlier of actual receipt or second business
day after being sent by air courier or commercial delivery service. Any party
hereto may from time to time, by written notice to the other parties, designate
a different address, which shall be substituted for the one specified below:

 

If to Seller:

 

Robert Hayden

_ rhayden@me.com_______________

 

Attn: ________

Fax: (___ )___ -

 

with a copy to:

 

_Michael Gillis______

__ mjg@gdlaw.com.au

 

Fax: (___ )

 

If to Buyer, to:

 

Ubiquity Broadcasting Corporation

9801 Research Drive

Irvine, CA. 92618

Attn: Chief Executive Officer

Fax: 949-954-1592

 

9.9           Public Announcements. Seller will not make any public
announcements concerning matters set forth in this Agreement or the negotiation
thereof without the prior written consent of the Buyer unless such disclosure is
required by law or rules and regulations of any governmental authority. Any such
disclosure shall be provided for review to the other party in advance of public
release to the extent reasonably practical.

 

9.10         Attorneys Fees. If any action or proceeding relating to this
Agreement or the Bill of Sale, or the enforcement of any provision of this
Agreement or the Bill of Sale is brought by a party hereto against any party
hereto, the prevailing party shall be entitled to recover reasonable attorney’s
fees, costs and disbursements (in addition to any other relief to which the
prevailing party may be entitled).

 

9.11         Survival Provisions. All obligations of the parties that are, or
may be, performed or performable after Closing shall survive the Closing.

 

22

 

 

[Signature Page Follows]

 

23

 

 

IN WITNESS WHEREOF, each of Seller and Buyer has caused its duly authorized
representative to execute this Asset Purchase Agreement on the date first
written above.

 

  BUYER:       Ubiquity Broadcasting Corporation,   a Nevada corporation        
By:           Name:     Title:           SELLER:       Monkeybars, Inc.,   a
Washington corporation         By:           Name: Michael Gillis   Title:
Director

 

24

 

 

EXHIBITS

 

Exhibit A Definitions Exhibit B Purchase Price Allocation Exhibit C Form of Bill
of Sale

 

 

 

 

EXHIBIT A

 

Definitions

 

For the purposes of this Agreement, unless the context otherwise requires, the
following terms shall have the respective meanings set forth below and
grammatical variations of such terms shall have corresponding meanings:

 

“Seller” means the Monkeybars Inc, a Washington corporation, and the assets
contemplated in connection with the “Asset Purchase Agreement”

 

“Adjusted Gross Revenue” means all gross revenues received by Buyer from the
operation of the Business, less: (a) shipping and handling charges, (b) returns,
charge-backs and credits paid back to Buyer, (c) deployment, administrative, and
maintenance costs, and (d) when applicable, all sales taxes collected.

 

“Copyrights” means copyrights and copyrightable works, including computer
applications, programs, Software, databases and related items, and
registrations, applications and renewals therefore.

 

“Encumbrance” means any encumbrance, lien, charge, hypothecation, pledge,
mortgage, title retention agreement, security interest of any nature,
restriction (other than restriction or transfer), condition or any adverse
interest of any nature, claim, exception, right of set-off, reservation,
easement, right of occupation, any matter capable of registration against title,
option, right of pre-emption, privilege, restriction, condition or any adverse
interest of any nature, or any contract to create any of the foregoing.

 

“GAAP” means generally accepted accounting principles in effect in the United
States of America at the time of application thereof, applied on a consistent
basis. Unless otherwise specified herein, all accounting terms used herein shall
be interpreted, and all determinations with respect to accounting matters
hereunder shall be made in accordance with generally accepted accounting
principles, applied on a consistent basis.

 

“Governmental Body” means any (a) nation, state, commonwealth, province,
territory, county, municipality, district or other jurisdiction of any nature;
(b) federal, state, local, municipal, foreign, supranational or other
government; or (c) governmental, self-regulatory or quasi-governmental authority
of any nature (including any governmental division, department, agency,
commission, instrumentality, official, organization, unit, body or Entity and
any court or other tribunal).

 

A-1

 

 

“Intellectual Property Rights” means any or all of the following and all rights,
arising out of or associated therewith: (1) inventions, whether or not
patentable, reduced to practice or made the subject of one or more pending
patent applications, (2) national and multinational statutory invention
registrations, patents and patent applications (including all reissues,
divisions, continuations, continuations-in-part, extensions and reexaminations
thereof) registered or applied for in the United States and all other nations
throughout the world, all improvements to the inventions disclosed in each such
registration, patent or patent application, (3) trademarks, service marks, trade
dress, logos, domain names, trade names and corporate names (whether or not
registered) in the United States and all other nations throughout the world,
including all variations, derivations, combinations, registrations and
applications for registration of the foregoing and all goodwill associated
therewith, (4) copyrights (whether or not registered) and registrations and
applications for registration thereof in the United States and all other nations
throughout the world, including all derivative works, moral rights, renewals,
extensions, reversions or restorations associated with such copyrights, now or
hereafter provided by law, regardless of the medium of fixation or means of
expression, (5) computer software, (including source code, object code,
firmware, operating systems and specifications), (6) trade secrets and, whether
or not confidential, business information (including pricing and cost
information, business and marketing plans and customer and supplier lists) and
know-how (including manufacturing and production processes and techniques and
research and development information), (7) industrial designs (whether or not
registered), (8) databases and data collections, (9) copies and tangible
embodiments of any of the foregoing, in whatever form or medium, (10) all rights
to obtain and rights to apply for patents, and to register trademarks and
copyrights, (11) all rights in all of the foregoing provided by treaties,
conventions and common law and (12) all rights to sue or recover and retain
damages and costs and reasonable attorneys' fees for past, present and future
infringement or misappropriation of any of the foregoing.

 

"Inventory" means all goods, merchandise and other personal property owned and
held for sale, and all raw materials, works-in-process, materials and supplies
of every nature which contribute to the finished products of the Seller in the
ordinary course of its business, specifically excluding, however, damaged,
defective or otherwise unsaleable items.

 

“Knowledge” of a party shall mean (i) if an individual, the actual knowledge of
the individual and any knowledge that a reasonable person in such capacity
should have after due inquiry, and (ii) if any entity, the actual knowledge of
any executive officer or controller of such party, and with respect to the
Seller and any knowledge that a reasonable person in such capacity should have
after due inquiry.

 

“Losses” in respect of any matter means all claims, demands, proceedings,
losses, damages, diminution in value, lost opportunities, obligations,
liabilities, deficiencies, costs and expenses (including all legal and other
professional fees and disbursements, interest, penalties and amounts paid in
settlement) arising, directly or indirectly, as a result of such matter.

 

“Marks” means any and all trademarks, logos, trade names and service marks
(registered and unregistered), including, but not limited to, any and all common
law and statutory rights therein and therefore, and further including any and
all registrations thereof and applications for registration therefore.

 

“Material Adverse Effect on Seller” and “Material Adverse Effect on its
Business” shall both mean a circumstance, state of facts, event, consequence or
result that materially and adversely affects, or could reasonably be expected to
affect materially and adversely the Purchased Assets or the business operations,
or condition (financial or otherwise) of Seller’s Business or the ability of
Seller to consummate the transactions which it is required to consummate
hereunder.

 

“Material Adverse Effect on Buyer” and “Material Adverse Effect on its Business”
shall mean a circumstance, state of facts, event, consequence or result that
materially and adversely affects, or could reasonably be expected to affect
materially and adversely business or the financial condition or operating
results of Buyer or the ability of Buyer to consummate the transactions which it
is required to consummate hereunder.

 

A-2

 

 

“Noncompete Period” means the period beginning on the Closing Date and
continuing for a period of five (5) years after the Closing Date.

 

“Open Source Software” means any Software, or any portion thereof, in source
code or object code, that is licensed, distributed or made available under any
license or other distribution agreement (i) containing any of the following
terms and conditions: (A) licensees of such software must have the right to
copy, sell or give away such software or modifications or derivative works
thereof without compensation to the licensor, (B) licensees of such software
must receive or have available access to the source code for such software, (C)
licensees of such software must have the right to modify and create derivative
works of such software or (ii) that is certified by the Open Source Initiative
or otherwise compliant with the most current version of the Open Source
Definition as published by the Open Source Initiative. Open Source Software,
without limitation, includes software licensed or distributed under any of the
following licenses or licenses similar to any of the following: (1) GNU’s
General Public License (GPL) or Lesser/Library GPL (LGPL), (2) the Artistic
License (e.g. PERL), (3) the Mozilla Public License, (iv) the Netscape Public
License, (4) the Berkeley software design (BSD) license including Free BSD or
BSD-style license, (5) the Sun Community Source License (SCSL), (6) an Open
Source Foundation License (e.g. CDE and Motif UNIX user interfaces), and (7) the
Apache Server license.

 

“Patents” means any and all patents, patent applications and work product
therefore and patent disclosures, together with reissuances, continuations,
continuations-in-part, revisions, extensions and reexaminations thereof.

 

“Person” means any individual, corporation, partnership, joint venture, limited
liability company, trust, Governmental Body or other organization.

 

“Software” means and includes all computer programs, whether in source code,
object code or other form (including without limitation any embedded in or
otherwise constituting part of a computer hardware device), algorithms, edit
controls, methodologies, applications, flow charts and any and all systems
documentation (including, but not limited to, data entry and data processing
procedures, report generation and quality control procedures), logic and designs
for all programs, and file layouts and written narratives of all procedures used
in the coding or maintenance of the foregoing.

 

“Straddle Period” shall mean a Tax period or year commencing prior to and ending
after the Closing Date.

 

“Territory” means the anywhere in the world where the Seller does business as of
the Closing.

 

“Trade Secrets” means know-how, inventions, discoveries, methods, processes,
technical data, specifications, research and development information,
technology, data bases and other proprietary or confidential information,
including customer lists, in each case that is the subject of reasonable efforts
to maintain confidentiality and that derives economic value from not being
generally known to Persons who can obtain economic value from its use, but
excluding any Copyrights or Patents that cover or protect any of the foregoing.

 

A-3

 

 

EXHIBIT B

 

Purchase Price Allocation

 

See Section 2.3

 

B-1

 

 

EXHIBIT C

 

Form of Bill of Sale

 

This BILL OF SALE AND ASSUMPTION AGREEMENT (this “Bill of Sale”) is made and
entered into as of April 24, 2014,by and between Ubiquity Broadcasting
Corporation, Inc., a Nevada corporation (“Buyer”), and Monkeybars, Inc., a
Washington corporation, (the “Seller”). Capitalized terms used but not defined
herein shall have the meanings ascribed to such terms in the Asset Purchase
Agreement (defined in the Recitals below).

 

RECITALS:

 

A.           Buyer and Seller are parties to an Asset Purchase Agreement, dated
as of April 24, 2014 (the “Asset Purchase Agreement”), pursuant to which Seller
has agreed to sell, transfer and convey to Buyer, and Buyer has agreed to
purchase substantially all of the assets related to Seller’s Business, as more
fully described in the Asset Purchase Agreement; and

 

B.           The execution of this Bill of Sale is a condition precedent under
the Asset Purchase Agreement.

 

AGREEMENT:

 

NOW, THEREFORE, in consideration of the terms, covenants and conditions
hereinafter set forth, the parties hereto agree as follows:

 

1.          Purchased Assets. In accordance with and subject to terms,
conditions and limitations set forth in the Asset Purchase Agreement, Seller
hereby sells, transfers, assigns, conveys and delivers to Buyer the Purchased
Assets free and clear of all Encumbrances TO HAVE AND TO HOLD; provided,
however, that with respect to Assigned Contracts, such Seller hereby sells,
assigns, transfers and conveys to Buyer all of Seller’s right, title and
interest in, under and to the Assigned Contracts from and after the Closing, to
the extent that such Assigned Contracts are, or hereafter become, legally
assignable or any necessary consents to assignment have been (or are hereafter)
obtained.

 

2.          Excluded Assets. Notwithstanding anything to the contrary contained
elsewhere in this Bill of Sale, the Excluded Assets are not sold hereby, but are
retained by Seller, and the Purchased Assets exclude any and all of the Excluded
Assets.

 

3.          Assumed Obligations. In accordance with and subject to the terms,
conditions and limitations set forth in the Asset Purchase Agreement, and
subject to the proviso set forth in Section 1 hereof, Seller hereby sells,
transfers, assigns, conveys and delivers to Buyer all of the Assumed
Obligations.

 

4.          Acceptance and Assumption. In accordance with and subject to the
terms, conditions and limitations set forth in the Asset Purchase Agreement, the
Buyer hereby (a) accepts the Purchased Assets as conveyed herein, (b) purchases
and accepts the sale, transfer, assignment, conveyance and delivery of Seller’s
right, title and interests in, under and to the Assigned Contracts (to the
extent that necessary consents to assignment have been obtained), as well as all
other Assumed Obligations, and (c)  assumes, undertakes and agrees, to pay,
satisfy, perform and discharge in full, as and when due, all obligations and
liabilities of any kind arising out of, or required to be performed under, such
Assigned Contracts and all other Assumed Obligations.

 

D-1

 

 

5.          Further Assurances. Each party hereto hereby agrees to execute and
deliver such other instruments and documents, and take such other actions, as
the other party may from time to time hereafter reasonably request to further
evidence the sale, transfer and conveyance to Buyer of the Purchased Assets, the
assignment of Assigned Contracts and the assumption and performance of the
Assumed Obligations; provided, that, with respect to any such request, the
requesting party bears the reasonable costs of preparing, executing and
delivering such instruments or taking of such actions, unless the other party is
expressly obligated, under any terms or provisions of the Asset Purchase
Agreement, to execute and deliver such documents or to take any such action.

 

6.          Execution in Counterparts. This Bill of Sale may be executed in two
or more counterparts, each of which shall be considered an original instrument,
but all of which shall be considered one and the same agreement. This Bill of
Sale shall become effective when counterparts have been signed by each of the
parties and delivered by facsimile or other means to the other party.

 

7.          Binding Effect. This Bill of Sale, and all of the covenants, terms
and conditions set forth herein shall be binding upon, and shall inure to the
benefit of, the parties hereto and their respective heirs, successors and
assigns.

 

8.          Governing Law. This Bill of Sale is deemed to have been made in the
State of California and shall be governed by and construed in accordance with
the substantive laws (but not the rules governing conflicts of laws) for
contracts made and to be performed in that state.

 

9.          Interpretation. In the event of any conflict or questions of
interpretation between the terms and provisions set forth in this Bill of Sale
and the Asset Purchase Agreement, the terms and provisions of the Asset Purchase
Agreement shall govern the obligations of the parties hereto.

 

[remainder of page intentionally left blank]

 

D-2

 

 

IN WITNESS WHEREOF, the parties hereto have executed this Bill of Sale on the
date and year first above written.

 

  BUYER:       Ubiquity Broadcasting Corporation,   a Nevada corporation      
By:           Name:           Title:         SELLER:       Monkeybars, Inc.,  
an Washington corporation       By:         Name: Michael Gillis       Title:
Director

   

D-3

 

 

SELLER’S ASSET SCHEDULES

 

SCHEDULE 1.1 (b) – SELLER’S ASSETS

 

D-1

 

 

SCHEDULE 1.1 (d) – SELLER’S LICENSES AND PERMITS

 

D-2

 

 

SCHEDULE 1.1 (e) – SELLER’S ASSET INVENTORY

 

D-3

 

 

SELLER’S DISCLOSURE SCHEDULES

 

SCHEDULE 3.3 – SELLER’S FINANCIAL STATEMENTS

 

D-4

 

 

SCHEDULE 3.4 – CHANGES IN SELLER’S BUSINESS

 

D-5

 

 

SCHEDULE 3.5 – TITLE MARKETABILITY OF THE PURCHASE ASSETS

 

D-6

 

 

SCHEDULE 3.6(a) – SELLER’S INTELLECTUAL PROPERTY RIGHTS

 

Patents

 

Trademarks

 

Domain Names

 

D-7

 

 

SCHEDULE 3.6(h) – OPEN SOURCE SOFTWARE

 

D-8

 

 

SCHEDULE 3.7 – ASSIGNED CONTRACTS AND OTHER AGREEMENTS

 

D-9

 

 

SCHEDULE 3.11 – LICENSES AND PERMITS

 

D-10

 

 

SCHEDULE 3.10 – LEGAL PROCEEDINGS

 

D-11