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Exhibit 10-1
 
AGREEMENT AND PLAN OF SHARE EXCHANGE
 

 
THIS AGREEMENT AND PLAN OF SHARE EXCHANGE (hereinafter referred to as the
“Agreement”), is entered into as of  11th day of June 2010 , by and among,
EXTREME HOME STAGING, INC., a publicly-owned Nevada corporation (“EXSG”), and Q
LOTUS, INC., a Nevada corporation (“QLI”), sometimes hereinafter collectively
referred to as the “Parties” and individually as a “Party.”)
 
W I T N E S S E T H
 
WHEREAS, EXSG is a publicly-owned Nevada  corporation with 7,339,999 shares of
common stock, par value $0.0001 per share, issued and outstanding (the “EXSG
Common Stock”) and is quoted on the Over the Counter Bulletin Board under the
symbol “EXSG”.
 
WHEREAS, the QLI Shareholders listed on Schedule I hereto own all of the issued
and outstanding shares of the common stock of QLI (the “QLI Common Stock”).
 
WHEREAS, the Parties desire that EXSG acquire all of the QLI Common Stock from
the QLI Shareholders solely in exchange for an aggregate of 10,000,000 newly
issued shares of common stock (the “Exchange Shares”) pursuant to the terms and
conditions set forth in this Agreement.
 
WHEREAS, immediately upon consummation of the Closing (as hereinafter defined),
the Exchange Shares will be issued to the QLI Shareholders on a pro rata basis,
in proportion to the ratio that the number of shares of QLI Common Stock held by
such QLI Shareholder bears to the number of shares of QLI Common Stock held by
all the QLI Shareholders as of the date of the Closing.
 
WHEREAS, following the Closing, QLI will become a wholly-owned subsidiary of
EXSG and the Exchange Shares will represent approximately fifty eight percent
(58%) of the total outstanding shares of Common Stock of EXSG.
 
WHEREAS, the Parties intend that the transaction contemplated herein (the
“Transaction”) qualify as a reorganization and tax-free exchange under Section
368(a) of the Internal Revenue Code of 1986, as amended.
 
NOW THEREFORE, on the stated premises and for and in consideration of the
foregoing recitals which are hereby incorporated by reference, the mutual
covenants and agreements hereinafter set forth and the mutual benefits to the
Parties to be derived herefrom and for other good and valuable consideration,
the sufficiency and receipt of which are hereby acknowledged, the Parties hereto
agree as follows:
 
ARTICLE I
 
PLAN OF EXCHANGE
 
1.1 The Exchange.  At the Closing (as hereinafter defined), each share of QLI
Common Stock issued and outstanding immediately prior to the Closing Date
(1,000,000 shares in aggregate) shall be exchanged for 10 shares of EXSG Common
Stock.  The aggregate number of shares of EXSG Stock exchanged for the QLI
Shares pursuant to this Agreement shall be 10,000,000.  From and after the
Closing Date, the QLI Shareholders shall no longer own any shares of QLI Common
Stock, and the stock certificates formerly representing shares of QLI Common
Stock shall represent the pro rata portion of the Exchange Shares issuable in
exchange therefor pursuant to this Agreement.  Any fractional shares that would
result from such exchange will be rounded up to the next highest whole number.
 
1.2 No Dilution.  EXSG shall neither effect, nor fix any record date with
respect to, any stock split, stock dividend, reverse stock split,
recapitalization, or similar change in the EXSG Stock between the date of this
Agreement and the Effective Time.
 
1.3 Closing. The closing (“Closing”) of the transactions contemplated by this
Agreement shall occur immediately following the execution of this Agreement
providing the closing conditions set forth in Articles V and VI have been
satisfied or waived (the “Closing Date”).
 
1.4 Closing Events.  At the Closing, each of the respective parties hereto shall
execute, acknowledge, and deliver (or shall cause to be executed, acknowledged,
and delivered) any and all stock certificates, officers’ certificates, opinions,
financial statements, schedules, agreements, resolutions, rulings, or other
instruments required by this Agreement to be so delivered at or prior to the
Closing, and the documents and certificates provided in Sections 5.2, 5.4, 6.2,
6.4 and 6.5, together with such other items as may be reasonably requested by
the parties hereto and their respective legal counsel in order to effectuate or
evidence the transactions contemplated hereby.  If agreed to by the parties, the
Closing may take place through the exchange of documents (other than the
exchange of stock certificates) by efax, fax, email and/or express courier.  At
the Closing, the Exchange Shares shall be issued in the names and denominations
provided by QLI.
 
 
 

 
ARTICLE II
 
REPRESENTATIONS, COVENANTS, AND WARRANTIES OF QLI
 
As an inducement to, and to obtain the reliance of EXSG, QLI represents and
warrants as follows:
 
2.1 Organization.  QLI is a corporation duly organized, validly existing, and in
good standing under the laws of the State of Nevada.  QLI has the power and is
duly authorized, qualified, franchised, and licensed under all applicable laws,
regulations, ordinances, and orders of public authorities to own all of its
properties and assets and to carry on its business in all material respects as
it is now being conducted, including qualification to do business as a foreign
corporation in jurisdictions in which the character and location of the assets
owned by it or the nature of the business transacted by it requires
qualification.  The execution and delivery of this Agreement does not, and the
consummation of the transactions contemplated by this Agreement in accordance
with the terms hereof will not, violate any provision of QLI’s organizational
documents.  QLI has taken all action required by laws, its certificate
of  incorporation, certificate of business registration, or otherwise to
authorize the execution and delivery of this Agreement. QLI has full power,
authority, and legal right and has taken or will take all action required by
law, its Certificate of  Incorporation, and otherwise to consummate the
transactions herein contemplated.
 
2.2 Capitalization.  All issued and outstanding shares of QLI are legally
issued, fully paid, and non-assessable and were not issued in violation of the
pre-emptive or other rights of any person.  QLI has no outstanding options,
warrants, or other convertible securities.
 
2.3 Financial Statements.
 
(a)  
QLI has filed all local income tax returns required to be filed by it from its
inception to the date hereof.  All such returns are complete and accurate in all
material respects.

 
(b)  
QLI has no liabilities with respect to the payment of federal, county, local, or
other taxes (including any deficiencies, interest, or penalties), except for
taxes accrued but not yet due and payable, for which QLI may be liable in its
own right or as a transferee of the assets of, or as a successor to, any other
corporation or entity.

 
(c)  
No deficiency for any taxes has been proposed, asserted or assessed against
QLI.  There has been no tax audit, nor has there been any notice to QLI by any
taxing authority regarding any such tax audit, or, to the knowledge of QLI, is
any such tax audit threatened with regard to any taxes or QLI tax returns.  QLI
does not expect the assessment of any additional taxes of QLI for any period
prior to the date hereof and has no knowledge of any unresolved questions
concerning the liability for taxes of QLI.

 
(d)  
The books and records, financial and otherwise, of QLI are in all material
respects complete and correct and have been maintained in accordance with good
business and accounting practices.

 
2.4 Information.  The information concerning QLI set forth in this Agreement and
the QLI Schedules (as that term is defined herein) are and will be complete and
accurate in all material respects and does not contain any untrue statement of a
material fact or omit to state a material fact required to make the statements
made, in light of the circumstances under which they were made, not misleading
as of the date hereof and as of the Closing Date.
 
2.5 Common Stock Equivalents.  There are no existing options, warrants, calls,
commitments of any character or other common stock equivalents relating to the
authorized and unissued QLI Common Stock.
 
2.6 Absence of Certain Changes or Events.  Except as set forth in this Agreement
or the QLI Schedules (as that term is defined herein):
 
(a)  
except in the normal course of business, there has not been (i) any material
adverse change in the business, operations, properties, assets, or condition of
QLI; or (ii) any damage, destruction, or loss to QLI (whether or not covered by
insurance) materially and adversely affecting the business, operations,
properties, assets, or condition of QLI;

 
(b)  
QLI has not (i) borrowed or agreed to borrow any funds or incurred, or become
subject to, any material obligation or liability (absolute or contingent) not
otherwise in the ordinary course of business, and except for capital raised by
issuance of debt or equity in a private placement or other capital raising
transaction deemed advisable by QLI; (ii) paid any material obligation or
liability not otherwise in the ordinary course of business (absolute or
contingent) other than current liabilities reflected in or shown on the most
recent QLI consolidated balance sheet, and current liabilities incurred since
that date in the ordinary course of business; (iii) sold or transferred, or
agreed to sell or transfer, any of its assets, properties, or rights not
otherwise in the ordinary course of business; (iv) made or permitted any
amendment or termination of any contract, agreement, or license to which they
are a party not otherwise in the ordinary course of business if such amendment
or termination is material, considering the business of QLI; or (v) issued,
delivered, or agreed to issue or deliver any stock, bonds or other corporate
securities including debentures (whether authorized and unissued or held as
treasury stock).

 
2.7 Litigation and Proceedings.  There are no actions, suits, proceedings, or
investigations pending or, to the knowledge of QLI, threatened by or against
QLI, or affecting QLI, or its properties, at law or in equity, before any court
or other governmental agency or instrumentality, domestic or foreign, or before
any arbitrator of any kind.
 
2.8 No Conflict With Other Instruments.  The execution of this Agreement and the
consummation of the transactions contemplated by this Agreement will not result
in the breach of any term or provision of, or constitute an event of default
under, any material indenture, mortgage, deed of trust, or other material
contract, agreement, or instrument to which QLI is a party or to which any of
its properties or operations are subject.
 
2.9 Contracts.  QLI has provided, or will provide EXSG, copies of all material
contracts, agreements, franchises, license agreements, or other commitments to
which QLI is a party or by which it or any of its assets, products, technology,
or properties are bound.
 
2.10 Compliance With Laws and Regulations.  QLI has complied with all applicable
statutes and regulations of any national, county, or other governmental entity
or agency thereof, except to the extent that noncompliance would not materially
and adversely affect the business, operations, properties, assets, or condition
of QLI.
 
2.11 Approval of Agreement.  The board of directors of QLI (the “QLI Board”) and
the QLI Shareholders have authorized the execution and delivery of this
Agreement by QLI and have approved the transactions contemplated hereby.
 
2.12 QLI Schedules.  QLI will deliver, as soon as practicable, the following
schedules, which are collectively referred to as the “QLI Schedules” and which
consist of separate schedules dated as of the date of execution of this
Agreement and instruments and data as of such date, all certified by the chief
executive officer of QLI as complete, true and correct:
 
(a)  
a schedule containing complete and correct copies of the organizational
documents, as amended, of QLI in effect as of the date of this Agreement; and

 
(b)  
a schedule as requested by EXSG, containing true and correct copies of all
material contracts, agreements, or other instruments to which QLI is a party or
by which it or its properties are bound, specifically including all contracts,
agreements, or arrangements referred to in Section 2.9.

 
2.13 Title and Related Matters.  QLI has good and marketable title to all of its
properties, interest in properties, and assets, real and personal, which are
reflected in the QLI balance sheet or acquired after that date (except
properties, interest in properties, and assets sold or otherwise disposed of
since such date in the ordinary course of business), free and clear of all
liens, pledges, charges, or encumbrances except:
 
(a)  
statutory liens or claims not yet delinquent; and

 
(b)  
as described in the QLI Schedules.

 
2.14 Governmental Authorizations.  QLI has all licenses, franchises, permits,
and other government authorizations, that are legally required to enable it to
conduct its business operations in all material respects as conducted on the
date hereof. Except for compliance with federal and state securities or
corporation laws, as hereinafter provided, no authorization, approval, consent,
or order of, or registration, declaration, or filing with, any court or other
governmental body is required in connection with the execution and delivery by
QLI of this Agreement and the consummation by QLI of the transactions
contemplated hereby.
 
2.15 Continuity of Business Enterprises.  QLI has no commitment or present
intention to liquidate QLI or sell or otherwise dispose of a material portion of
its business or assets following the consummation of the transactions
contemplated hereby.
 
2.16 Ownership of QLI Shares.  The QLI Shareholders are the legal and beneficial
owners of 100% of the QLI Common Stock as set forth on Schedule I, free and
clear of any claims, charges, equities, liens, security interests, and
encumbrances whatsoever, and the QLI Shareholders have full right, power, and
authority to transfer, assign, convey, and deliver their respective QLI Common
Stock; and delivery of such common stock at the Closing will convey to EXSG good
and marketable title to such shares free and clear of any claims, charges,
equities, liens, security interests, and encumbrances except for any such
claims, charges, equities, liens, security interests, and encumbrances arising
out of such shares being held by EXSG.
 
2.17 Brokers.  QLI has not entered into any contract with any person, firm or
other entity that would obligate QLI or EXSG to pay any commission, brokerage or
finders’ fee in connection with the transactions contemplated herein.
 
2.18 Nominees.  The nominees of QLI to serve as EXSG's directors and officers
following the Closing (the "Nominees"), whose names and signatures appear on
Schedule II hereto, represent that no event listed in Sub-paragraphs (1) through
(4) of Subparagraph (d) of Item 401 of Regulation S-B has occurred with respect
to any of the Nominees during the past five years which is material to an
evaluation of the ability or integrity of such Nominee.
 
2.19 Subsidiaries and Predecessor Corporations.  QLI does not have any
subsidiaries and does not own, beneficially or of record, any shares or other
equity interests of any other corporation or entity.
 

 
ARTICLE III
 
REPRESENTATIONS, COVENANTS, AND WARRANTIES OF EXSG
 
As an inducement to, and to obtain the reliance of QLI, EXSG represents and
warrants as follows:
 
3.1 Organization.  EXSG is a corporation duly organized, validly existing, and
in good standing under the laws of the State of Nevada, and has the corporate
power and is duly authorized, qualified, franchised, and licensed under all
applicable laws, regulations, ordinances, and orders of public authorities to
own all of its properties and assets and to carry on its business in all
material respects as it is now being conducted, and there is no jurisdiction in
which it is not qualified in which the character and location of the assets
owned by it or the nature of the business transacted by it requires
qualification. Included in the EXSG Schedules (as hereinafter defined) are
complete and correct copies of the Articles of Incorporation and bylaws of EXSG,
and all amendments thereto, as in effect on the date hereof. The execution and
delivery of this Agreement does not, and the consummation of the transactions
contemplated hereby will not, violate any provision of EXSG’s Articles of
Incorporation or bylaws. EXSG has taken all action required by law, its
Certificate of Incorporation, its bylaws, or otherwise to authorize the
execution and delivery of this Agreement, and EXSG has full power, authority,
and legal right and has taken all action required by law, its Certificate of
Incorporation, By-Laws, or otherwise to consummate the transactions herein
contemplated.
 
3.2 Capitalization.  EXSG’s authorized capitalization (without including pending
corporate actions) consists of 200,000,000 shares of Common Stock, of which no
more than 17,339,999  shares will be issued and outstanding at Closing, and
10,000,000 shares of preferred stock, par value $0.001 per share authorized (the
“Preferred Stock”), of which no shares are outstanding.  All presently issued
and outstanding shares are legally issued, fully paid, and non-assessable and
not issued in violation of the pre-emptive or other rights of any person.  The
Exchange Shares will be legally issued, fully paid and non-assessable and shall
not be issued in violation of the pre-emptive or other rights of any other
person.
 
3.3 Financial Statements.  Except as set forth within its filing of reports with
the Securities and Exchange Commission (the "SEC Reports"):
 
(a)  
EXSG has no liabilities with respect to the payment of any federal, state,
county, local, or other taxes (including any deficiencies, interest, or
penalties), except for taxes accrued but not yet due and payable, for which EXSG
may be liable in its own right, or as a transferee of the assets of, or as a
successor to, any other corporation or entity.

 
(b)  
EXSG has filed all federal, state, or state tax returns required to be filed by
it from inception.

 
(c)  
The books and records, financial and otherwise, of EXSG are in all material
respects complete and correct and have been maintained in accordance with good
business and accounting practices.

 
(d)  
No deficiency for any taxes has been proposed, asserted or assessed against
EXSG.  There has been no tax audit, nor has there been any notice to EXSG by any
taxing authority regarding any such tax audit, or, to the knowledge of EXSG, is
any such tax audit threatened with regard to any taxes or EXSG tax
returns.  EXSG does not expect the assessment of any additional taxes of EXSG
for any period prior to the date hereof and has no knowledge of any unresolved
questions concerning the liability for taxes of EXSG.

 
(e)  
EXSG has good and marketable title to its assets and, except as set forth in the
EXSG Schedules, has no material contingent liabilities, direct or indirect,
matured or unmatured.

 
3.4 Information.  The information concerning EXSG set forth in this Agreement
and the EXSG Schedules are and will be complete and accurate in all material
respects and does not contain any untrue statement of a material fact or omit to
state a material fact required to make the statements made, in light of the
circumstances under which they were made, not misleading as of the date hereof
and as of the Closing Date.
 
3.5 Common Stock Equivalents.  Except as set forth herein, there are no existing
options, warrants, calls, commitments of any character or other common stock
equivalents relating to authorized and unissued stock of EXSG.
 
3.6 Absence of Certain Changes or Events.  Except as described herein or in the
EXSG Schedules:
 
(a)  
There has not been (i) any material adverse change, financial or otherwise, in
the business, operations, properties, assets, or condition of EXSG (whether or
not covered by insurance) materially and adversely affecting the business,
operations, properties, assets, or condition of EXSG;

 
(b)  
EXSG, (except for pending corporate actions not included herein)  has not (i)
amended its Articles of Incorporation or by-laws; (ii) declared or made, or
agreed to declare or make any payment of dividends or distributions of any
assets of any kind whatsoever to stockholders or purchased or redeemed, or
agreed to purchase or redeem, any of its capital stock; (iii) waived any rights
of value which in the aggregate are extraordinary or material considering the
business of EXSG; (iv) made any material change in its method of management,
operation, or accounting; (v) entered into any other material transactions; (vi)
made any accrual or arrangement for or payment of bonuses or special
compensation of any kind or any severance or termination pay to any present or
former officer or employee; (vii) increased the rate of compensation payable or
to become payable by it to any of its officers or directors or any of its
employees; or (viii) made any increase in any profit sharing, bonus, deferred
compensation, insurance, pension, retirement, or other employee benefit plan,
payment, or arrangement, made to, for, or with its officers, directors, or
employees;

 
(c)  
EXSG has not (i) granted or agreed to grant any options, warrants, or other
rights for its stocks, bonds, or other corporate securities calling for the
issuance thereof; (ii) borrowed or agreed to borrow any funds or incurred, or
become subject to, any material obligation or liability (absolute or contingent)
except liabilities incurred in the ordinary course of business; (iii) paid or
agreed to pay any material obligation or liability (absolute or contingent)
other than current liabilities reflected in or shown on the most recent EXSG
balance sheet and current liabilities incurred since that date in the ordinary
course of business and professional and other fees and expenses incurred in
connection with the preparation of this Agreement and the consummation of the
transactions contemplated hereby; (iv) sold or transferred, or agreed to sell or
transfer, any of its assets, property, or rights (except assets, property, or
rights not used or useful in its business which, in the aggregate have a value
of less than $1,000), or canceled, or agreed to cancel, any debts or claims
(except debts or claims which in the aggregate are of a value of less than
$1,000); (v) made or permitted any amendment or termination of any contract,
agreement, or license to which it is a party if such amendment or termination is
material, considering the business of EXSG; or (vi) issued, delivered, or agreed
to issue or deliver any stock, bonds, or other corporate securities including
debentures (whether authorized and unissued or held as treasury stock), except
in connection with this Agreement;

 
(d)  
EXSG has no assets, liabilities or accounts payable of any kind or nature,
actual or contingent, in excess of $4,500 in the aggregate as of the Closing
Date; and

 
(e)  
To the best knowledge of EXSG, it has not become subject to any law or
regulation which materially and adversely affects, or in the future may
adversely affect, the business, operations, properties, assets, or condition of
EXSG.

 
3.7 Title and Related Matters.  EXSG has good and marketable title to all of its
properties, interest in properties, and assets, real and personal, which are
reflected in the EXSG balance sheet or acquired after that date (except
properties, interest in properties, and assets sold or otherwise disposed of
since such date in the ordinary course of business), free and clear of all
liens, pledges, charges, or encumbrances except:
 
(a)  
statutory liens or claims not yet delinquent;

 
(b)  
such imperfections of title and easements as do not and will not materially
detract from or interfere with the present or proposed use of the properties
subject thereto or affected thereby or otherwise materially impair present
business operations on such properties; and

 
(c)  
as described in the EXSG Schedules.

 
3.8 Litigation and Proceedings.  There are no actions, suits, or proceedings
pending or, to the knowledge of EXSG, threatened by or against or affecting
EXSG, at law or in equity, before any court or other governmental agency or
instrumentality, domestic or foreign, or before any arbitrator of any kind.
 
3.9 Contracts.  EXSG is not a party to any material contract, agreement, or
other commitment, except as specifically disclosed in its schedules to this
Agreement.
 
3.10 No Conflict With Other Instruments.  The execution of this Agreement and
the consummation of the transactions contemplated by this Agreement will not
result in the breach of any term or provision of, or constitute a default under,
any indenture, mortgage, deed of trust, or other material agreement or
instrument to which EXSG is a party or to which it or any of its assets or
operations are subject.
 
3.11 Governmental Authorizations.  EXSG is not required to have any licenses,
franchises, permits, and other government authorizations, that are legally
required to enable it to conduct its business operations in all material
respects as conducted on the date hereof. Except for compliance with federal and
state securities or corporation laws, as hereinafter provided, no authorization,
approval, consent, or order of, or registration, declaration, or filing with,
any court or other governmental body is required in connection with the
execution and delivery by EXSG of this Agreement and the consummation by EXSG of
the transactions contemplated hereby.
 
3.12 Compliance With Laws and Regulations.  To the best of its knowledge, EXSG
has complied with all applicable statutes and regulations of any federal, state,
or other applicable governmental entity or agency thereof, except to the extent
that noncompliance would not materially and adversely affect the business,
operations, properties, assets, or conditions of EXSG or except to the extent
that noncompliance would not result in the incurrence of any material liability.
 
3.13 Insurance.  EXSG owns no insurable properties and carries no casualty or
liability insurance.
 
3.14 Approval of Agreement.  The board of directors of EXSG (the “EXSG Board”)
has authorized the execution and delivery of this Agreement by EXSG and has
approved this Agreement and the transactions contemplated hereby.
 
3.15 Material Transactions of Affiliations.  Except as disclosed herein and in
the EXSG Schedules, there exists no material contract, agreement, or arrangement
between EXSG and any person who was at the time of such contract, agreement, or
arrangement an officer, director, or person owning of record or known by EXSG to
own beneficially, 10% or more of the issued and outstanding common stock of EXSG
and which is to be performed in whole or in part after the date hereof or was
entered into not more than three years prior to the date hereof. Neither any
officer, director, nor 10% stockholder of EXSG has, or has had during the last
preceding full fiscal year, any known interest in any material transaction with
EXSG which was material to the business of EXSG. EXSG has no commitment, whether
written or oral, to lend any funds to, borrow any money from, or enter into any
other material transaction with any such affiliated person.
 
3.16 Employment Matters.  EXSG has no employees other than its executive
officers.
 
3.17 EXSG Schedules.  Prior to the Closing, EXSG shall have delivered to QLI the
following schedules, which are collectively referred to as the “EXSG Schedules,”
which are dated the date of this Agreement, all certified by an officer to be
complete, true, and accurate:
 
(a)  
a schedule containing complete and accurate copies of the Certificate
of  Incorporation and by-laws, as amended, of EXSG as in effect as of the date
of this Agreement;

 
(b)  
a schedule containing a copy of the federal income tax returns of EXSG
identified in Section 3.3(b); and

 
(c)  
a schedule setting forth any other information, together with any required
copies of documents, required to be disclosed in the EXSG Schedules.

 
3.18 Brokers.  EXSG has not entered into any contract with any person, firm or
other entity that would obligate QLI or EXSG to pay any commission, brokerage or
finders’ fee in connection with the transactions contemplated herein.
 
3.19 Subsidiaries.  EXSG does not have any subsidiaries and does not own,
beneficially or of record, any shares or other equity interests of any other
corporation or other entity.
 

 
ARTICLE IV
 
SPECIAL COVENANTS
 
4.1 Post-Closing Covenants.   Within ten (10) days following the Closing, EXSG
shall file a Preliminary Information Statement in accordance with the provisions
of Rule 14C of the Rules promulgated under the Securities Exchange Act of 1934,
as amended, to amend EXSG's Articles of Incorporation to provide for the
following: to change the name of the Corporation to "Q Lotus, Inc", or such
similar name as is available; to increase the number of EXSG's authorized
capital stock to 400,000,0000 shares of Common Stock and increase the preferred
shares to  100,000,000 shares of preferred stock, par value, $0.001 per share.
 

4.2 Shareholders’ Actions of EXSG.  Prior to the Closing, EXSG shall cause the
following actions to be taken by the written consent of the holders of a
majority of the outstanding shares of common stock of EXSG:
 
(a)  
the approval of this Agreement and the transactions contemplated hereby and
thereby; and

 
(b)  
such other actions as the directors may determine are necessary or appropriate.

 
4.3 Actions of QLI Shareholders.  Prior to the Closing, QLI shall cause the
following actions to be taken by the written consent of the holders of a
majority of the outstanding shares of common stock of QLI:
 
(a)  
the approval of this Agreement and the transactions contemplated hereby and
thereby; and

 
(b)  
such other actions as the directors may determine are necessary or appropriate.

 
4.4 Access to Properties and Records.  EXSG and QLI will each afford to the
officers and authorized representatives of the other reasonable access to the
properties, books, and records of EXSG or QLI in order that each may have full
opportunity to make such reasonable investigation as it shall desire to make of
the affairs of the other, and each will furnish the other with such additional
financial and operating data and other information as to the business and
properties of EXSG or QLI as the other shall from time to time reasonably
request.
 
4.5 Delivery of Books and Records.  At the Closing, EXSG shall deliver to QLI,
the originals of the corporate minute books, books of account, contracts,
records, and all other books or documents of EXSG now in the possession or
control of EXSG or its representatives and agents.
 
4.6 Actions Prior to Closing by both Parties.
 
(a)  
From and after the date of this Agreement until the Closing Date and except as
set forth in the EXSG or QLI Schedules or as permitted or contemplated by this
Agreement, EXSG and QLI will each: (i) carry on its business in substantially
the same manner as it has heretofore; (ii) maintain and keep its properties in
states of good repair and condition as at present, except for depreciation due
to ordinary wear and tear and damage due to casualty; (iii) maintain in full
force and effect insurance comparable in amount and in scope of coverage to that
now maintained by it; (iv) perform in all material respects all of its
obligation under material contracts, leases, and instruments relating to or
affecting its assets, properties, and business; (v) use its best efforts to
maintain and preserve its business organization intact, to retain its key
employees, and to maintain its relationship with its material suppliers and
customers; and (vi) fully comply with and perform in all material respects all
obligations and duties imposed on it by all federal and state laws and all
rules, regulations, and orders imposed by federal or state governmental
authorities.

 
(b)  
From and after the date of this Agreement until the Closing Date, neither EXSG
nor QLI will: (i) make any change in their organizational documents, charter
documents or bylaws; (ii) take any action described in Section 2.6 in the case
of QLI, or in Section 3.6, in the case of EXSG (all except as permitted therein
or as disclosed in the applicable party’s schedules); (iii) enter into or amend
any contract, agreement, or other instrument of any of the types described in
such party’s schedules, except that a party may enter into or amend any
contract, agreement, or other instrument in the ordinary course of business
involving the sale of goods or services, or (iv) make or change any material tax
election, settle or compromise any material tax liability or file any amended
tax return.

 
4.7 Indemnification.
 
(a)  
QLI hereby agrees to indemnify EXSG and each of the officers, agents and
directors of EXSG as of the date of execution of this Agreement against any
loss, liability, claim, damage, or expense (including, but not limited to, any
and all expense whatsoever reasonably incurred in investigating, preparing, or
defending against any litigation, commenced or threatened, or any claim
whatsoever), to which it or they may become subject arising out of or based on
any inaccuracy appearing in or misrepresentation made in Article II. The
indemnification provided for in this paragraph shall not survive the Closing and
consummation of the transactions contemplated hereby but shall survive the
termination of this Agreement pursuant to Section 7.1(b) of this Agreement.

 
(b)  
EXSG hereby agrees to indemnify QLI and each of the officers, agents and
directors of QLI as of the date of execution of this Agreement against any loss,
liability, claim, damage, or expense (including, but not limited to, any and all
expense whatsoever reasonably incurred in investigating, preparing, or defending
against any litigation, commenced or threatened, or any claim whatsoever), to
which it or they may become subject arising out of or based on any inaccuracy
appearing in or misrepresentation made under Article III. The indemnification
provided for in this paragraph shall not survive the Closing and consummation of
the transactions contemplated hereby but shall survive the termination of this
Agreement pursuant to Section 7.1(c) of this Agreement.

 

 
ARTICLE V
 
CONDITIONS PRECEDENT TO OBLIGATIONS OF EXSG
 
The obligations of EXSG under this Agreement are subject to the satisfaction, at
or before the Closing, of the following conditions:

5.1 Accuracy of Representations; Performance.  The representations and
warranties made by QLI in this Agreement were true when made and shall be true
at the Closing Date with the same force and effect as if such representations
and warranties were made at and as of the Closing Date (except for changes
therein permitted by this Agreement), and QLI shall have performed or complied
with all covenants and conditions required by this Agreement to be performed or
complied with by QLI prior to or at the Closing. EXSG may request to be
furnished with a certificate, signed by a duly authorized officer of QLI and
dated the Closing Date, to the foregoing effect.
 
5.2 Officer’s Certificates.  EXSG shall have been furnished with a certificate
dated the Closing Date and signed by a duly authorized officer of QLI to the
effect that no litigation, proceeding, investigation, or inquiry is pending or,
to the best knowledge of QLI threatened, which might result in an action to
enjoin or prevent the consummation of the transactions contemplated by this
Agreement, or, to the extent not disclosed in the QLI Schedules, by or against
QLI which might result in any material adverse change in any of the assets,
properties, business, or operations of QLI.
 
5.3 No Material Adverse Change.  Prior to the Closing Date, there shall not have
occurred any material adverse change in the financial condition, business, or
operations of QLI, nor shall any event have occurred which, with the lapse of
time or the giving of notice, may cause or create any material adverse change in
the financial condition, business, or operations.
 
5.4 Other Items.
 
(a)  
EXSG shall have received such further documents, certificates, or instruments
relating to the transactions contemplated hereby as EXSG may reasonably request.

 
(b)  
Complete and satisfactory due diligence review of QLI by EXSG.

 
(c)  
Approval of the Transaction by the QLI Board and the QLI Shareholders.

 
(d)  
Any necessary third-party consents shall be obtained prior to Closing, including
but not limited to consents necessary from QLI’s lenders, creditors, vendors and
lessors.

 

 
ARTICLE VI
 
CONDITIONS PRECEDENT TO OBLIGATIONS OF QLI
 
The obligations of QLI under this Agreement are subject to the satisfaction, at
or before the Closing, of the following conditions:
 
6.1 Accuracy of Representations; Performance.  The representations and
warranties made by EXSG in this Agreement were true when made and shall be true
as of the Closing Date (except for changes therein permitted by this Agreement)
with the same force and effect as if such representations and warranties were
made at and as of the Closing Date, and EXSG shall have performed and complied
with all covenants and conditions required by this Agreement to be performed or
complied with by EXSG prior to or at the Closing.  QLI shall have been furnished
with a certificate, signed by a duly authorized executive officer of EXSG and
dated the Closing Date, to the foregoing effect.
 
6.2 Officer’s Certificate.  QLI shall have been furnished with a certificate
dated the Closing Date and signed by a duly authorized executive officer of EXSG
to the effect that no litigation, proceeding, investigation, or inquiry is
pending or, to the best knowledge of EXSG threatened, which might result in an
action to enjoin or prevent the consummation of the transactions contemplated by
this Agreement.
 
6.3 No Material Adverse Change.  Prior to the Closing Date, there shall not have
occurred any material adverse change in the financial condition, business, or
operations of EXSG nor shall any event have occurred which, with the lapse of
time or the giving of notice, may cause or create any material adverse change in
the financial condition, business, or operations of EXSG.
 
6.4 Good Standing.  QLI shall have received a certificate of good standing from
the Secretary of State of the State of Florida or other appropriate office,
dated as of a date within ten days prior to the Closing Date certifying that
EXSG is in good standing as a corporation in the State of Florida and has filed
all tax returns required to have been filed by it to date and has paid all taxes
reported as due thereon.
 
6.5 Other Items.
 
(a)  
QLI shall have received a stockholder list of EXSG containing the name, address,
and number of shares held by each EXSG stockholder as of the date of Closing
certified by an executive officer of EXSG as being true, complete, and accurate.

 
(b)  
QLI shall have received such further documents, certificates, or instruments
relating to the transactions contemplated hereby as QLI may reasonably request.

 
(c)  
Complete and satisfactory due diligence review of EXSG by QLI.

 
(d)  
Approval of the Transaction by the EXSG Board and the stockholders of EXSG.

 
(e)  
There shall have been no material adverse changes in EXSG, financial or
otherwise.

 
(f)  
There shall be no EXSG Common Stock Equivalents outstanding as of immediately
prior to the Closing.  For purposes of the foregoing, “EXSG Common Stock
Equivalents” shall mean any subscriptions, warrants, options or other rights or
commitments of any character to subscribe for or purchase from EXSG, or
obligating EXSG to issue, any shares of any class of the capital stock of EXSG
or any securities convertible into or exchangeable for such shares.

 
(g)  
Any necessary third-party consents shall be obtained prior to Closing, including
but not limited to consents necessary from EXSG’s lenders, creditors; vendors,
and lessors.

 

 
 
 
 
ARTICLE VII
 
MISCELLANEOUS
 
7.1 Governing Law.  This Agreement shall be governed by, enforced, and construed
under and in accordance with the laws of the United States of America and, with
respect to matters of state law, with the laws of New York.  Any dispute arising
under or in any way related to this Agreement will be submitted to binding
arbitration before a single arbitrator by the American Arbitration Association
in accordance with the Association’s commercial rules then in effect. The
arbitration will be conducted in New York, New York. The decision of the
arbitrator will set forth in reasonable detail the basis for the decision and
will be binding on the parties. The arbitration award may be confirmed by any
court of competent jurisdiction.
 
7.2 Notices.  Any notices or other communications required or permitted
hereunder shall be sufficiently given if personally delivered to it or sent by
registered mail or certified mail, postage prepaid, or by prepaid telegram and
any such notice or communication shall be deemed to have been given as of the
date so delivered, mailed, or telegraphed.
 
7.3 Attorney’s Fees. In the event that any party institutes any action or suit
to enforce this Agreement or to secure relief from any default hereunder or
breach hereof, the breaching party or parties shall reimburse the non-breaching
party or parties for all costs, including reasonable attorneys’ fees, incurred
in connection therewith and in enforcing or collecting any judgment rendered
therein.
 
7.4 Confidentiality. EXSG, on the one hand, and QLI and the QLI Shareholders, on
the other hand, will keep confidential all information and materials regarding
the other Party designated by such Party as confidential.  The provisions of
this Section 8.4 shall not apply to any information which is or shall become
part of the public domain through no fault of the Party subject to the
obligation from a third party with a right to disclose such information free of
obligation of confidentiality. EXSG and QLI agree that no public disclosure will
be made by either Party of the existence of the Transaction or the letter of
intent or any of its terms without first advising the other Party and obtaining
its prior written consent to the proposed disclosure, unless such disclosure is
required by law, regulation or stock exchange rule.
 
7.5 Expenses.  Except as otherwise set forth herein, each party shall bear its
own costs and expenses associated with the transactions contemplated by this
Agreement.  Without limiting the generality of the foregoing, all costs and
expenses incurred by QLI and EXSG after the Closing shall be borne by the
surviving entity.  After the Closing, the costs and expenses of the QLI
Shareholders shall be borne by the QLI Shareholders.
 
7.6 Schedules; Knowledge.  Each party is presumed to have full knowledge of all
information set forth in the other party’s schedules delivered pursuant to this
Agreement.
 
7.7 Third Party Beneficiaries.  This contract is solely between EXSG, QLI and
the QLI Shareholders, and, except as specifically provided, no director,
officer, stockholder, employee, agent, independent contractor, or any other
person or entity shall be deemed to be a third party beneficiary of this
Agreement.
 
7.8 Entire Agreement.  This Agreement represents the entire agreement between
the parties relating to the transaction. There are no other courses of dealing,
understandings, agreements, representations, or warranties, written or oral,
except as set forth herein.
 
7.9 Survival.  The representations and warranties of the respective parties
shall survive the Closing Date and the consummation of the transactions herein
contemplated.
 
7.10 Counterparts.  This Agreement may be executed in multiple counterparts,
each of which shall be deemed an original and all of which taken together shall
be but a single instrument.
 
7.11 Amendment or Waiver.  Every right and remedy provided herein shall be
cumulative with every other right and remedy, whether conferred herein, at law,
or in equity, and may be enforced concurrently herewith, and no waiver by any
party of the performance of any obligation by the other shall be construed as a
waiver of the same or any other default then, theretofore, or thereafter
occurring or existing. At any time prior to the Closing Date, this Agreement may
be amended by a writing signed by all parties hereto, with respect to any of the
terms contained herein, and any term or condition of this Agreement may be
waived or the time for performance hereof may be extended by a writing signed by
the party or parties for whose benefit the provision is intended.
 
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IN WITNESS WHEREOF, the corporate parties hereto have caused this Agreement to
be executed by their respective officers, hereunto duly authorized, as of the
date first above-written.
 
EXTREME HOME STAGING, INC.

By:_/s/ Marckensie Theresias
     Marckensie Theresias , President, CEO

Q LOTUS, INC.

By:___/s/ Marckensie Theresias
     Markensie Theresias,  President, CEO

 
 

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SCHEDULE I

Dated:  
 
 
The following persons are the only owners of the capital stock of QLI:

 
Person/Entity
Shares
Percentage
EXSG Share Ownership
           
Marckensie Theresias
1,000,000
100%
10,000,000
                                                                               
                                                             
      
 
 

 
 

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SCHEDULE II

to

STOCK EXCHANGE AGREEMENT

Name:
Position(s)
Signature
 
Marckensie Theresias
President, Director
   
Director