Exhibit 10.1
 
TECHNOLOGY TRANSFER AGREEMENT
 
BETWEEN
 
FREEZE TAG, INC. AND __________________
 
DATED AS OF 22 JUNE 2011
 
This TECHNOLOGY TRANSFER AGREEMENT (this “Agreement”), dated as of June 22, 2011
(the “Closing Date”), between __________________(“DEVELOPER”), and FREEZE TAG,
INC. (“Freeze Tag”), a Delaware corporation.
 
WHEREAS, DEVELOPER desires to sell, transfer, assign, convey and deliver to
Freeze Tag, and Freeze Tag desires to purchase and receive from DEVELOPER
certain intellectual property including but not limited to software owned and/or
developed by DEVELOPER wherein Freeze Tag shall acquire from DEVELOPER all
intellectual property rights granted thereunder; and
 
WHEREAS, the Parties each agree to certain capitalized terms used in this
Agreement which shall have the meanings assigned to such terms as set forth in
Section 7.02(a) of this Agreement;
 
NOW, THEREFORE, in consideration of the foregoing recitals and the mutual
covenants and agreements of the Parties contained in this Agreement, intending
to be legally bound, the Parties hereby agree as follows:
 
ARTICLE I.
 
SALE AND PURCHASE OF ASSETS
 
Section 1.01           Purchase and Sale At the Closing, DEVELOPER shall, on the
terms and subject to the conditions of this Agreement, sell, assign, transfer,
convey and otherwise deliver to Freeze Tag, and Freeze Tag shall purchase from
DEVELOPER and its Affiliates, all of the right, title and interest in, the
Acquired Assets, as defined in Section 1.02, for the following consideration: 
(a) Thirty Six Thousand Dollars ($36,000 USD) payable in 24 installments, as
defined in Section 1.04, and (b) Ninety-six Thousand (96,000) shares of Freeze
Tag (FRZT) stock payable in 8 installments, as defined in Section 1.04.  The
purchase and sale of the Acquired Assets is referred to in this Agreement
collectively as the “Acquisition”.
 
Section 1.02           Transfer of Assets
 
(a)           The term “Acquired Assets” means all right, title, and interest
in, to and under those certain assets set forth below:
 
(i)             the Intellectual Property as set forth in Exhibit A;
 
(ii)            all the rights owned or controlled by DEVELOPER related
exclusively to the Intellectual Property, not including any and all claims
(legal or equitable), counterclaims, credits, causes of action, choices in
action, rights of recovery, rights of set off, guarantees, warranties,
indemnities and similar rights (whether existing before or after the Closing
Date);
 
(b)           Freeze Tag acknowledges and agrees that by acquiring the Acquired
Assets it is not acquiring any rights, title or interest in, to or under, and
the Acquired Assets shall not include, any of the following (the “Excluded
Assets”):
 
(i)             any and all cash and cash equivalents of DEVELOPER;
 
(ii)            any and all DEVELOPER Names and any and all logos, variations or
derivatives thereof other than those expressly specified in Exhibit A;
 
(iii)           any and all Retained Information;
 
(iv)          any and all intellectual property or intellectual property rights
other than the Intellectual Property; and
 
(vii)         any and all rights, claims and credits of DEVELOPER or any of its
Affiliates relating to any Excluded Asset or any Excluded Liability, including
any such items arising under insurance policies and all guarantees, warranties,
indemnities and similar rights in favor of DEVELOPER or any of its Affiliates
relating to any Excluded Asset or any Excluded Liability.
 
 
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(c)           Freeze Tag shall acquire the Acquired Assets free and clear of all
encumbrances.
 
(d)           This agreement in no way impacts the current agreement for
programming services between Freeze Tag and Developer, in which Developer is
paid monthly fees for engineering / game programming services (and bonuses from
time to time for specific games). This agreement to purchase the Acquired Assets
(including the rights to the technology framework) is “separate and apart” from
that development services agreement.
 
(e)           Any future design or development work on the Acquired Assets by
DEVELOPER shall remain the property of Freeze Tag.
 
Section 1.03           Assumed Liabilities Freeze Tag shall assume no
liabilities in the acquisition of the Acquired Assets.
 
Section 1.04           Closing; Closing Deliveries
 
(a)           The consummation of the transactions contemplated by this
Agreement (the “Closing”) will take place on the Closing Date
 
(b)           At the Closing, DEVELOPER shall deliver or cause to be delivered
to Freeze Tag the following:
 
(i)             the Acquired Assets in such mutually agreeable format as
reasonably requested; and
 
(ii)            Copies of all files and records relating to the Acquired Assets;
and
 
(iii)           the names and email addresses of any other developers that may
be currently using the Acquired Assets.
 
(c)           At the Closing, DEVELOPER shall remove or cause to be removed the
following:
 
(i)             all references to the Acquired Assets on DEVELOPER web site
 
(d)           At the Closing, Freeze Tag shall deliver to DEVELOPER the
following:
 
(i)             cash in the amount of Thirty Six Thousand Dollars ($36,000),
payable by wire transfer (to a bank account designated by DEVELOPER) in
Twenty-Four installments of $1,500 USD per installment;
 
(ii)           Ninety Six Thousand (96,000) shares of Freeze Tag (FRZT) stock
payable in Eight (8) installments (1 per quarter for eight quarters) of Twelve
Thousand (12,000) shares.  The shares will be delivered to DEVELOPER on the last
day of the month for that quarter.  The first installment will be delivered
effective September 30, 2011.  Developer must abide by US government (SEC) rules
in terms of holding onto shares before they can be sold for a certain period of
time. Also, Developer will be subject to US government (Internal Revenue
Service) rules for taxation.
 
 
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ARTICLE II.
 
REPRESENTATIONS AND WARRANTIES OF DEVELOPER
 
DEVELOPER represents and warrants to Freeze Tag as follows:
 
Section 2.01           Organization DEVELOPER is duly organized, validly
existing and in good standing under the laws of the Country of Portugal.
 
Section 2.02           Authority; Execution and Delivery; Enforceability
DEVELOPER has the requisite corporate power and authority to execute and deliver
this Agreement on its own behalf and on behalf of its Affiliates, and to perform
all of its and its Affiliates’ respective obligations hereunder.  The execution
and delivery of this Agreement and the performance by DEVELOPER of its and its
Affiliates’ respective obligations hereunder have been authorized by all
requisite corporate action on its and its Affiliates’ parts.  This Agreement has
been validly executed and delivered by DEVELOPER.  Assuming that this Agreement
has been duly authorized, executed and delivered by Freeze Tag, this Agreement
constitutes a valid and binding obligation of DEVELOPER and its Affiliates,
enforceable against DEVELOPER and each such Affiliate in accordance with its
terms, except as such enforceability may be limited by (a) bankruptcy,
insolvency, moratorium, reorganization or other laws of general applicability
relating to or affecting the enforcement of creditors’ rights generally and
general principles of equity; and (b) laws limiting the availability of specific
performance, injunctive relief or other equitable remedies.
 
Section 2.03           Consents and Approvals; No Violations DEVELOPER
represents and warrants that neither the execution and delivery of this
Agreement by DEVELOPER, the performance by DEVELOPER of its obligations
hereunder nor the transfer of Acquired Assets:
 
(i)            violates the certificate of incorporation, by-laws or other
organizational documents of DEVELOPER;
 
(ii)           conflicts in any respect with or results in a violation or breach
of, or constitutes a default under, any of the Contracts or any contract,
agreement, guaranty, financing or loan document, or instrument to which
DEVELOPER is a party or by which DEVELOPER or any Acquired Asset is bound, or
results in the creation or imposition of any Lien upon any Acquired Asset;
 
(iii)          conflicts or violates with any existing law (including common
law), statute, rule, regulation, ordinance, judgment, order or decree (each, a
“Law”) applicable to DEVELOPER or the Acquired Assets; or
 
(iv)          materially impairs DEVELOPER’ ability to consummate the
transactions contemplated hereby or materially delays the consummation of the
transactions contemplated hereby.
 
(b)           DEVELOPER represents and warrants that no filing with, and no
permit, authorization, consent or approval of any Governmental Entity is
necessary for the assignment by DEVELOPER of the Acquired Assets to Freeze Tag.
 
(c)           DEVELOPER represents and warrants that the Intellectual Property
and Acquired Assets specified in Exhibit A are being transferred exclusively to
Freeze Tag, and DEVELOPER further agrees that it will not sell or otherwise
distribute the same to any entities.  DEVELOPER shall not be entitled to use the
Intellectual Property or Acquired Assets in any way (other than for Freeze Tag
products).
 
 
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Section 2.04           Title to Assets As of the Effective Date of this
Agreement, DEVELOPER and/or its Affiliates have good and valid title to all of
the Acquired Assets, in each case, free and clear of all Liens and DEVELOPER
and/or its Affiliates are the sole legal and beneficial owner of the Acquired
Assets and have the right to sell them to Freeze Tag in accordance with this
Agreement.
 
(b)            DEVELOPER and/or its Affiliates have the sole and exclusive right
to enforce, license or transfer, without payment to any Third Party, each item
of Intellectual Property.
 
(c)            DEVELOPER does not have in effect, and after the Effective Date
shall not enter into, any oral or written agreement or arrangement that would be
inconsistent with the terms of this Agreement.
 
Section 2.05           Intellectual Property Rights
 
(a)            DEVELOPER has the full right, power, and authority to assign all
of the right, title, and interest in the Intellectual Property set forth in this
Agreement.
 
(b)           As of the Effective Date, there exists no claim and DEVELOPER
knows of no claim brought or threatened by any third party that the practice of
the Intellectual Property infringes any issued patents owned or possessed by any
third party.
 
(c)            Except as set forth herein, DEVELOPER has not granted any option,
license or right to use any of the Intellectual Property to a third party, and
no third party has any right, title, or interest in or to any of the
Intellectual Property.
 
(d)            No claim, judgment, or settlement has been made against DEVELOPER
arising from the Acquired Assets as of the Effective Date of this Agreement, and
to the best of DEVELOPER’s knowledge, no such claim, judgment, or settlement is
pending or threatened as of the Effective Date.
 
Section 2.06           Material Facts Neither this Agreement nor any written
statement or certificate furnished in connection herewith or any of the
transactions contemplated hereby, contains an untrue statement of a material
fact or omits to state a material fact that is necessary in order to make the
statements contained herein and therein, in the light of the circumstances under
which they are made, not misleading.  There are no facts that affect, or in the
future might reasonably be expected to affect, adversely the Acquired Assets in
any material respect that is not set forth in this Agreement.
 
Section 2.07           Disclaimer
 
Except as expressly set forth in this Section 2, the Acquired Assets assigned by
DEVELOPER pursuant to this Agreement are provided “AS IS” without any warranty,
express, implied or statutory and DEVELOPER expressly disclaims any warranty of
title, non-infringement, fitness for a particular purpose or merchantability
with respect to any Acquired Asset assigned or delivered pursuant to this
Agreement.
 
ARTICLE III.
 
REPRESENTATIONS AND WARRANTIES OF FREEZE TAG
 
Freeze Tag represents and warrants to DEVELOPER as follows:
 
Section 3.01           Organization Freeze Tag is duly organized, validly
existing and in good standing under the laws of the State of Delaware.  Freeze
Tag has all requisite corporate power and authority to own, lease and operate
its properties and to conduct its business as now being conducted.
 
Section 3.02           Authority; Execution and Delivery; Enforceability Freeze
Tag has the requisite corporate power and authority to execute and deliver this
Agreement and to perform its obligations hereunder.  The execution and delivery
of this Agreement and the performance by Freeze Tag of its obligations hereunder
have been authorized by all requisite corporate action on the part of Freeze
Tag.  This Agreement has been validly executed and delivered by Freeze Tag. 
Assuming that this Agreement has been duly authorized, executed and delivered by
DEVELOPER, this Agreement constitutes a valid and binding obligation of Freeze
Tag, enforceable against Freeze Tag in accordance with its terms, except as such
enforceability may be limited by bankruptcy, insolvency, moratorium,
reorganization or other laws of general applicability relating to or affecting
the enforcement of creditors’ rights generally and general principles of equity.
 
 
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Section 3.03           Consents and Approvals; No Violations None of the
execution and delivery of this Agreement by Freeze Tag, the performance by
Freeze Tag of its obligations hereunder or the consummation of the Acquisition:
 
(i)            violates the memorandum of association or other organizational
documents of Freeze Tag
 
(ii)           conflicts in any respect with or results in a violation or breach
of, or constitutes a default under, any material contract, agreement or
instrument to which Freeze Tag is a party or by which Freeze Tag or any of its
properties or assets are bound; 
 
(iii)          conflicts or violates with any existing Law applicable to Freeze
Tag;  or
 
(iv)          materially impairs Freeze Tag’s ability to consummate the
transactions contemplated hereby or materially delay the consummation of the
transactions contemplated hereby (a “Freeze Tag Material Adverse Effect”).
 
(b)           No filing with, and no permit, authorization, consent or approval
of, any Governmental Entity is necessary for the consummation by Freeze Tag of
the transactions contemplated by this Agreement.
 
Section 3.04           Brokers or Finders Freeze Tag has not retained any agent,
broker, investment banker, financial advisor or other firm or person that is or
will be entitled to any brokers’ or finder’s fee or any other commission or
similar fee in connection with any of the transactions contemplated by this
Agreement, and there are no claims for any of the foregoing.
 
Section 3.05           No Proceedings Except as would not reasonably be expected
to have a Freeze Tag Material Adverse Effect, there is no Proceeding pending or,
to the knowledge of Freeze Tag, threatened against Freeze Tag which would
reasonably be expected to affect Freeze Tag’s ability to consummate the
transactions contemplated by this Agreement.
 
ARTICLE IV.
 
COVENANTS
 
Section 4.01           Property Transfer Taxes Except as otherwise provided
herein, any fees, charges, Taxes or other payments required to be made to any
Governmental Entity in connection with the transfer of the Acquired Assets
pursuant to the terms of this Agreement (collectively, “Transfer Taxes”) shall
be paid by DEVELOPER.  DEVELOPER and Freeze Tag shall cooperate in timely making
and filing all filings, Tax Returns, reports and forms as may be required with
respect to any Taxes payable in connection with the transfer of the Acquired
Assets.
 
Section 4.02           Further Assurances; Etc. Each Party shall, from time to
time after the Closing and without additional consideration, execute and deliver
such further instruments and take such other commercially reasonable action as
may be reasonably requested by the other Party to make effective the
transactions contemplated by this Agreement.
 
(b)           Except as otherwise expressly set forth in this Agreement, from
and after the Closing Date, neither DEVELOPER nor any of its Affiliates shall
make any use of the Acquired Assets and shall hold them on trust for Freeze Tag.
 
(c)           Except as would not reasonably be expected to have a Material
Adverse Effect, DEVELOPER shall take no action to disparage or diminish the
value of the Acquired Assets. 
 
 
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Section 4.03           No Use of DEVELOPER Names Except for the tradenames
included in Exhibit A as part of the Acquired Assets, Freeze Tag shall not use
any signs or stationery, purchase order forms, packaging, labeling or other
similar items or supplies, advertising and promotional materials, product,
training and service literature and materials, or computer programs or like
materials (collectively, the “Supplies”) that include or contain any trademark,
trade names, service mark or corporate or business names of DEVELOPER or its
Affiliates (or any logo, variation or derivative thereof) (collectively,
“DEVELOPER Names”).  Nothing in this Section 4.03 shall be deemed as
transferring any rights in, to or under the DEVELOPER Names.
 
Section 4.04           Bulk Transfer Laws DEVELOPER shall indemnify Freeze Tag
against any non compliance by DEVELOPER and its Affiliates with the provisions
of any so-called “bulk transfer law” of any jurisdiction in connection with the
sale of the Acquired Assets to Freeze Tag.  DEVELOPER shall indemnify Freeze Tag
for any tax liability that results from any such non-compliance.
 
Section 4.05           Post-Closing Cooperation Freeze Tag and DEVELOPER shall
cooperate with each other, and shall cause their officers, employees, agents,
auditors, Affiliates and representatives to cooperate with each other, after the
Closing Date, to ensure the orderly transition of the Acquired Assets from
DEVELOPER to Freeze Tag. 
 
(b)           Neither Party shall be required by this Section 4.05 to take any
action that would unreasonably interfere with the conduct of its business or
unreasonably disrupt its normal operations.
 
ARTICLE V.
 
SURVIVAL AND INDEMNIFICATION
 
Section 5.01           Survival All representations, warranties, obligations and
associated rights under this agreement shall survive the consummation of the
transaction contemplated hereby.
 
Section 5.02           Indemnification by Freeze Tag Freeze Tag agrees to
indemnify and hold harmless DEVELOPER, its Affiliates and their respective
officers, directors, shareholders, employees, agents, successors and assigns
(each, a “DEVELOPER Indemnified Party”) against any and all claims, damages,
costs, or losses, including without limitation reasonable attorneys’ fees
(“Losses”) arising out of or related to (a) a breach of any representation,
warranty, covenant or agreement of Freeze Tag in this Agreement.
 
(b)  Indemnification by DEVELOPER DEVELOPER agrees to indemnify and hold
harmless Freeze Tag, its Affiliates and their respective officers, directors,
shareholders, employees, agents, successors and assigns (each, a “Freeze Tag
Indemnified Party”) against any and all claims, damages, costs, or losses,
including without limitation reasonable attorneys’ fees (“Losses”) arising out
of or related to (a) a breach of any representation, warranty, covenant or
agreement of DEVELOPER in this Agreement or (b) any prior obligations.
 
 
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Section 5.03           Indemnification Process In the case of any claim asserted
by a third party against a party entitled to indemnification under this
Agreement (the “Indemnified Party”), notice shall be given by the Indemnified
Party to the party required to provide indemnification (the “Indemnifying
Party”) promptly after such Indemnified Party has actual knowledge of any claim
as to which indemnity may be sought, and the Indemnified Party shall permit the
Indemnifying Party (at the expense of such Indemnifying Party) to assume the
defense of any claim or any litigation resulting therefrom; provided that (a)
the counsel for the Indemnifying Party who shall conduct the defense of such
claim or litigation shall be reasonably satisfactory to the Indemnified Party,
(b) the Indemnified Party may participate in such defense at such Indemnified
Party’s expense, and (c) the omission by any Indemnified Party to give notice as
provided herein shall not relieve the Indemnifying Party of its indemnification
obligation under this Agreement except to the extent that such omission results
in a failure of actual notice to the Indemnifying Party and such Indemnifying
Party is materially damaged as a result of such failure to give notice.  Except
with the prior written consent of the Indemnified Party, no Indemnifying Party,
in the defense of any such claim or litigation, shall consent to entry of any
judgment or enter into any settlement that provides for injunctive or other
non-monetary relief affecting the Indemnified Party or that does not include as
an unconditional term thereof the giving by each claimant or plaintiff to such
Indemnified Party of a release from all liability with respect to such claim or
litigation.  In the event that the Indemnified Party shall in good faith
determine that the conduct of the defense of any claim subject to
indemnification hereunder or any proposed settlement of any such claim by the
Indemnifying Party might be expected to affect adversely the Indemnified Party’s
Tax liability or the ability of Freeze Tag to conduct its business, or that the
Indemnified Party may have available to it one or more defenses or counterclaims
that are inconsistent with one or more of those that may be available to the
Indemnifying Party in respect of such claim or any litigation relating thereto,
the Indemnified Party shall have the right at all times to take over and assume
control over the defense, settlement, negotiations or litigation relating to any
such claim at the sole cost of the Indemnifying Party; provided that if the
Indemnified Party does so take over and assume control, the Indemnified Party
shall not settle such claim or litigation without the written consent of the
Indemnifying Party, such consent not to be unreasonably withheld or delayed. In
the event that the Indemnifying Party does not accept the defense of any matter
as above provided, the Indemnified Party shall have the full right to defend
against any such claim or demand and shall be entitled to settle or agree to pay
in full such claim or demand with the written consent of the Indemnifying Party,
such consent not to be unreasonably withheld or delayed.  In any event, the
Indemnifying Party and the Indemnified Party shall cooperate in the defense of
any claim or litigation subject to this Section 5.04 and the records of each
shall be available to the other with respect to such defense.
 
ARTICLE VI.
 
LIMITATION OF LIABILITY
 
Section 6.01           Disclaimer of Consequential Damages.  NEITHER PARTY WILL
BE LIABLE FOR ANY LOSS, INDIRECT, SPECIAL, CONSEQUENTIAL or INCIDENTAL DAMAGES
OF ANY KIND (INCLUDING LOST PROFITS) REGARDLESS OF FORM OR THEORY OF LAW OR
OTHERWISE EVEN IF IT HAS BEEN ADVISED OF THE POSSIBILITY.
 
Section 6.02            DEVELOPER’s total cumulative liability to Freeze Tag
shall not exceed the total amount of the Purchase Price paid to DEVELOPER.  
 
 
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ARTICLE VII.
 
MISCELLANEOUS
 
Section 7.01           Notices Except as otherwise specifically provided herein,
any notice or other documents to be given under this Agreement shall be in
writing and shall be deemed to have been duly given if sent by registered post,
nationally recognized overnight courier or confirmed facsimile transmission to a
Party (followed by hard copy by mail) or delivered in person to a Party at the
address or facsimile number set out below for such Party or such other address
as the Party may from time to time designate by written notice to the other:
 
(a)           if to DEVELOPER,
to:                                       __________________
 
(b)           if to Freeze Tag,
to:                                           Freeze Tag Incorporated
 
228 W. Main St., 2nd Floor
Tustin, CA 92780
Attention: Craig Holland
Fax Number: (714) 210-3851
 
Any such notice or other document shall be deemed to have been received by the
addressee three (3) Business Days following the date of dispatch of the notice
or other document by post or, where the notice or other document is sent by
overnight courier, by hand or is given by facsimile, simultaneously with the
transmission or delivery thereof.
 
Section 7.02           Definitions; Interpretation For purposes of this
Agreement:
 
“Affiliate” shall mean, with respect to any Person, any other Person that
directly, or indirectly through one or more intermediaries, controls, is
controlled by or is under common control with, such Person. A Person shall be
regarded as in control of another Person if such Person owns, or directly or
indirectly controls, more than fifty percent (50%) of the voting securities (or
comparable equity interests) or other ownership interests of the other Person,
or if such Person directly or indirectly possesses the power to direct or cause
the direction of the management or policies of the other Person, whether through
the ownership of voting securities, by contract or any other means whatsoever,
provided, however, that for purposes of this Agreement, the term “Affiliate”
shall not include subsidiaries in which a Party or its Affiliates owns a
majority of the ordinary voting power to elect a majority of the Board of
Directors, but is restricted from electing such majority by contract or
otherwise, until such time as such restrictions are no longer in effect.
 
“Business Day” shall mean any day other than (a) a Saturday or Sunday or (b) any
other day on which commercial banks in New York City are authorized or required
by law to close.
 
“Code” shall mean the Internal Revenue Code of 1986, as amended.
 
“Governmental Entity” shall mean any federal, state, local or non-United States
government, legislature, governmental agency, administrative agency or
commission or other governmental authority or instrumentality or any United
States or non-United States court of competent jurisdiction.
 
“Intellectual Property” shall mean the copyrightable works, products,
discoveries, developments, designs, improvements, inventions, concepts,
processes, techniques, know how, audiovisual elements, content and computer code
(including all Source Code & Materials) (whether or not patentable, and whether
or not at a commercial stage, or registerable under copyright or similar
statutes) which are authored, made, conceived in conjuction with the technology
set forth on Exhibit A hereto relating to the Patents.
 
 
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“Intellectual Property Rights” means all forms of intellectual property and
proprietary rights recognized by U.S. laws and other applicable foreign and
international laws, treaties and conventions in intellectual property such as
know-how, inventions, patents, patent rights, and registrations and
applications, renewals, continuations and extensions thereof, works of
authorship and art, copyrightable materials and copyrights (including, but not
limited to, titles, computer code, designs, themes, objects, buildings and
architecture, automobiles, characters, character names, stories, dialog, catch
phrases, locations, game play, rules, concepts, artwork, animation, sounds,
musical compositions, graphics and visual elements, audio-visual effects and
methods of operation, and any related documentation), copyright registrations
and applications, renewals and extensions therefor, mask works, industrial
rights, trademarks, service marks, service names, trade names, logos, product
names, trademark registrations and applications, renewals and extensions
therefor, trade secrets, rights in trade dress and packaging, publicity,
personality and privacy rights, rights of attribution, paternity, integrity and
other similarly afforded “moral” rights; and all rights to sue for and remedies
against past, present and future infringements or misappropriations of the
foregoing.
 
“Knowledge of DEVELOPER” shall mean the actual knowledge of the executive
officers of the Company after due inquiry.  The term “due inquiry” shall mean
such inquiry by the applicable person as such person would normally be
reasonably expected to make in the ordinary course of his or her regular and
usual duties as an owner, director, officer of key employee of a corporation.
 
“Liabilities” means any debt, obligation, duty or liability of any nature
(including any unknown, undisclosed, unfixed, unliquidated, unsecured,
unmatured, unaccrued, unasserted, contingent, conditional, inchoate, implied,
vicarious, joint, several or secondary liability), regardless of whether such
debt, obligation, duty or liability would be required to be disclosed on a
balance sheet prepared in accordance with generally accepted accounting
principles applied on a consistent basis.
 
“Lien” shall mean any lien (statutory or otherwise), claim, charge, option,
security interest, pledge, mortgage, restriction, financing statement or similar
encumbrance of any kind or nature whatsoever (including any conditional sale or
other title retention agreement and any lease having substantially the same
effect as any of the foregoing and any assignment or deposit arrangement in the
nature of a security device).
 
“Material Adverse Effect” shall mean a material and adverse effect on any
Acquired Asset, the Parties’ ability to consummate the Acquisition or Freeze
Tag’s use of the Acquired Assets following the Acquisition.
 
“Party” shall mean DEVELOPER or Freeze Tag and, when used in the plural, shall
mean DEVELOPER and Freeze Tag and in the case of DEVELOPER shall include its
Affiliates
 
“Patents” shall mean all U.S. and foreign patents and patent applications
(provisionals and non-provisional), and all additions, divisions, continuations,
continuations-in-part, substitutions, reissues, extensions, registrations,
renewals, reexaminations and Letters Patent.
 
“Person” shall mean any individual, group, corporation, partnership or other
organization or entity (including any Governmental Entity).
 
 
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“Retained Information” shall mean those books and records prepared and
maintained by DEVELOPER and all Tax records.
 
“Tax Return” shall mean any report, return or other information filed with any
taxing authority with respect to Taxes imposed upon or attributable to the
Acquired Assets.
 
“Taxes” shall mean any and all taxes, charges, fees, tariffs, imports, required
deposits, levies or other like assessments, including, but not limited to,
transfer, income, profits, net worth, asset, value added transactions, gains,
gross receipts, excise, inventory, property (real, personal or intangible),
custom duty, sales, use, license, withholding, payroll, employment, social
security, capital stock and franchise taxes, imposed by any Governmental Entity.
 
“Third Party” shall mean any Person who or which is neither a Party nor an
Affiliate of a Party.
 
“Trademarks” shall mean any trademark or tradename registered or unregistered as
expressly set forth in Exhibit A, if any.   
 
(b)           In the event of an ambiguity or if a question of intent or
interpretation arises, this Agreement shall be construed as if drafted jointly
by the Parties, and no presumption or burden of proof shall arise favoring or
disfavoring any Party by virtue of the authorship of any provisions of this
Agreement.
 
(c)           The definitions of the terms used in this Agreement shall apply
equally to the singular and plural forms of the terms defined.  Whenever the
context may require, any pronoun shall include the corresponding masculine,
feminine and neuter forms.  Any reference to dollars shall mean United States
dollars.  In this Agreement, the words “include”,  “includes” and “including”
shall be deemed to be followed by the phrase “without limitation”, and the word
“will” shall be construed to have the same meaning and effect as the word
“shall”.  Unless the context requires otherwise, in this Agreement (i) any
definition of or reference to any agreement, instrument or other document in
this Agreement shall be construed as referring to such agreement, instrument or
other document as from time to time amended, supplemented or otherwise modified
(subject to any restrictions on such amendments, supplements or modifications
set forth herein or therein), (ii) any reference in this Agreement to any Person
shall be construed to include the Person’s successors and assigns, (iii) the
words “herein”, “hereof” and “hereunder”, and words of similar import, shall be
construed to refer to this Agreement in its entirety and not to any particular
provision hereof, and (iv) all references in this Agreement to Articles,
Sections, Exhibits shall be construed to refer to Articles, Sections, and
Exhibits of this Agreement.
 
 
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Section 7.03           Descriptive Headings The descriptive headings herein are
inserted for convenience only and are not intended to be part of or to affect
the meaning or interpretation of this Agreement.
 
Section 7.04           Counterparts This Agreement may be executed in one or
more counterparts, all of which shall be considered one and the same agreement
and shall become effective when one or more such counterparts have been signed
by each of the parties and delivered to the other Party.
 
Section 7.05           Entire Agreement This Agreement, along with the Exhibits
hereto and thereto contain the entire agreement and understanding between the
parties hereto with respect to the Acquisition and supersede all prior
agreements and understandings relating to the Acquisition.  No Party shall be
liable or bound to any other Party in any manner by any representations,
warranties or covenants other than as specifically set forth herein and,
thereupon, only to the extent provided in Section 5.01.
 
Section 7.06           Fees and Expenses Regardless of whether or not any of the
transactions contemplated by this Agreement are consummated, each Party shall
bear its own fees and expenses incurred in connection with the transactions
contemplated by this Agreement.
 
Section 7.07           Governing Law This Agreement shall be governed by and
construed in accordance with the internal laws of the State of California
applicable to agreements made and to be performed entirely within such state,
without regard to the conflicts of law principles of such state.
 
Section 7.08           Assignment Neither Party may transfer or assign this
Agreement, directly or indirectly, or any of its rights hereunder without the
prior written consent of the other Party, other than (a) to one or more
Affiliates, (b) in a reverse triangular merger or (c) to a successor in
connection with the transfer or sale of all or substantially all of its business
relating to the subject matter of this Agreement.  Any attempted transfer or
assignment in violation of this Section 7.08 shall be void; provided, that in
the event of a permitted change in control, the original party’s (or its
successor’s) obligations hereunder shall continue.  This Agreement shall be
binding upon and inure to the benefit of the parties and their permitted
successors and assigns.
 
Section 7.09           Amendments and Waivers This Agreement may not be amended
except by an instrument in writing signed on behalf of each of the Parties
hereto.  By an instrument in writing, Freeze Tag, on the one hand, or DEVELOPER,
on the other hand, may waive compliance by the other Party with any term or
provision of this Agreement that such other Party was or is obligated to comply
with or perform.
 
Section 7.10           Successors and Assigns This Agreement shall be binding
upon and inure solely to the benefit of the Parties, their successors and
permitted assigns, and nothing in this Agreement, express or implied, is
intended to or shall confer upon any other Third Party any right, benefits or
remedies of any nature whatsoever under or by reason of this Agreement.
 
Section 7.11           Severability In the event that any one or more of the
provisions contained herein, or the application thereof in any circumstances, is
held invalid, illegal or unenforceable in any respect for any reason, the
parties shall negotiate in good faith with a view to the substitution therefore
of a suitable and equitable solution in order to carry out, so far as may be
valid and enforceable, the intent and purpose of such invalid provision;
provided, however, that the validity, legality and enforceability of any such
provision in every other respect and of the remaining provisions contained
herein or therein shall not be in any way impaired thereby, it being intended
that all of the rights and privileges of the parties hereto and thereto shall be
enforceable to the fullest extent permitted by law.
 
Section 7.12           Consent to Jurisdiction Each of Freeze Tag and DEVELOPER
irrevocably submits to the jurisdiction of California for the purposes of any
suit, action or other proceeding arising out of this Agreement or any
transaction contemplated hereby.  Each of Freeze Tag and DEVELOPER agrees to
commence any such action, suit or proceeding in the State or Federal Courts in
the Southern District of California.  Each of Freeze Tag and DEVELOPER
irrevocably and unconditionally waives any objection to the laying of venue of
any action, suit or proceeding arising out of this Agreement or the transactions
contemplated hereby and thereby in California and hereby further irrevocably and
unconditionally waives and agrees not to plead or claim in any such court that
any such action, suit or proceeding brought in any such court has been brought
in an inconvenient forum.
 
 
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Section 7.13           Waiver of Jury Trial Each Party hereby waives, to the
fullest extent permitted by applicable law, any right it may have to a trial by
jury in respect of any litigation directly or indirectly arising out of, under
or in connection with this Agreement.  Each Party hereto:
 
(a)           certifies that no representative, agent or attorney of any other
Party has represented, expressly or otherwise, that such other Party would not,
in the event of litigation, seek to enforce that foregoing waiver; and
 
(b)           acknowledges that it and the other Party has been induced to enter
into this Agreement by, among other things, the mutual waivers and
certifications in this Section 7.13.
 
Section 7.14           Non-waiver Any failure on the part of a Party to enforce
at any time or for any period of time any of the provisions of this Agreement
shall not be deemed or construed to be a waiver of such provisions or of any
right of such Party thereafter to enforce each and every such provision on any
succeeding occasion or breach thereof.
 
Section 7.15           Costs.  Each Party agrees to indemnify and keep
indemnified the Other Party against any and all legal costs and/or expenses
incurred by the Other Party as a result of any breach of this Agreement by the
indemnifying Party.
 
Section 7.16           Equitable Relief.  Each Party agrees that on any breach
of this Agreement by it, the Other Party shall be entitled to any appropriate
injunctive and/or other equitable relief in relation to such breach.
 
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date first written above.
 

                 
By:
/s/Unreadable      
Name:
     
Title:
         
Freeze Tag, Inc.
         
By:
/s/ Craig Holland
     
Name: Craig Holland
     
Title: CEO
 

 
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EXHIBIT A
 
LIST OF INTELLECTUAL PROPERTY
 
Summary of IP:  __________________ Game Engine:  A Python Based Casual 2D Game
Engine for Windows (Direct3D), Mac OS X (OpenGL), iOS (OpenGL ES) and Android.
 
 
Detailed Description:
 
 
The __________________ Engine (including source code, documentation, and other
creative works) is a 2D casual game engine architected with rapid and
streamlined development in mind.  It allows a developer to run the same code on
Windows, Mac OS X, Linux, iOS and Android. It is based on Python, Direct3D,
OpenGL and OpenGL ES technologies.
 
The engine handles tasks such as resource loading and management, choosing the
appropriate render subsystem at runtime (D3D9, D3D8, OpenGL or OpenGL ES),
render target textures, the main loop, saving and restoring game preferences
(fullscreen state, music and sound volumes) and player progress, game
states/screens and dialogs, UI control creation and management, event callbacks,
event scheduling, light weight particle effects, distortion meshes, linear and
trigonometric interpolation functions for smooth animations, bitmap fonts, sound
effects and music, etc.
 
The engine’s main open source component is the Python programming language,
which has nothing game specific built in to it.  It is a general purpose
programming language.  On Windows, Mac OS X and Linux, there are two additional
open source components: SDL and FFMPEG. SDL is used to setup the application
window and fetching events and the purpose of using it was to avoid having to
write boiler plate code for the different platforms for that purposes. SDL also
provides basic graphics rendering functions, but the engine uses none of those –
instead all of the rendering is done by Direct3D or OpenGL using engine specific
code. The FFMPEG library is used to decode video and audio files for movies –
all the data packet management and rendering is handled by the engine as well
and the purpose of FFMPEG is to allow movies with the same encoding to be played
on several platforms without using MOVs specifically on Mac, etc.
 
These two components (SDL and FFMPEG) are both open source components, and the
engine is designed to be modular, so it would be fairly easy to swap SDL or
FFMPEG for another cross-platform library or platform specific code without
having to rewrite or restructure the engine’s core architecture.
 

 
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