Exhibit 10.1

 

AGREEMENT

 

CONCERNING THE EXCHANGE OF SECURITIES

 

BY AND AMONG

 

SUB-URBAN BRANDS, INC. FORMERLY KNOWN AS DP&D, INC.

 

AND

 

SUB-URBAN INDUSTRIES, INC. AND

 

THE SECURITY HOLDERS OF SUB-URBAN INDUSTRIES, INC.

 

--------------------------------------------------------------------------------

 

INDEX

 

 

Page

 

 

ARTICLE I - EXCHANGE OF SECURITIES

1

 

 

 1.1

- Issuance of Securities

1

 1.2

- Exemption from Registration

1

 1.3

- Corporate Action by DP&D

2

 

 

ARTICLE II - REPRESENTATIONS AND WARRANTIES OF SUB-URBAN

2

 

 

 2.1

- Organization

2

 2.2

- Capital

2

 2.3

- Subsidiaries

2

 2.4

- Directors and Officers

2

 2.5

- Financial Statements

3

 2.6

- Absence of Changes

3

 2.7

- Absence of Undisclosed Liabilities

3

 2.8

- Tax Returns

3

 2.9

- Investigation of Financial Condition

3

 2.10

- Intellectual Property Rights

3

 2.11

- Compliance with Laws

4

 2.12

- Litigation

4

 2.13

- Authority

4

 2.14

- Ability to Carry Out Obligations

4

 2.15

- Full Disclosure

4

 2.16

- Assets and Liabilities

4

 2.17

- Material Contracts

4

 2.18

- Indemnification

4

 2.19

- Criminal or Civil Acts

5

 2.20

- Restricted Securities

5

 

 

ARTICLE III - REPRESENTATIONS AND WARRANTIES OF DP&D, INC.

5

 

 

 3.1

- Organization

5

 3.2

- Capital

5

 3.3

- Subsidiaries

5

 3.4

- Directors and Officers

5

 3.5

- Financial Statements

5

 3.6

- Absence of Changes

6

 3.7

- Absence of Undisclosed Liabilities

6

 3.8

- Tax Returns

6

 

1

--------------------------------------------------------------------------------

 

 

Page

 

 

 3.9

- Investigation of Financial Condition

6

 3.10

- Intellectual Property Rights

6

 3.11

- Compliance with Laws

6

 3.12

- Litigation

6

 3.13

- Authority

6

 3.14

- Ability to Carry Out Obligations

6

 3.15

- Full Disclosure

7

 3.16

- Assets and Liabilities

7

 3.17

- Material Contracts

7

 3.18

- Indemnification

7

 3.19

- Criminal or Civil Acts

7

 3.20

- Bulletin Board Trading Status

7

 

 

ARTICLE IV - COVENANTS PRIOR TO THE CLOSING DATE

7

 

 

 

 4.1

- Investigative Rights

7

 4.2

- Conduct of Business

8

 4.3

- Confidential Information

8

 4.4

- Notice of Non-Compliance

8

 

 

ARTICLE V - CONDITIONS PRECEDENT TO DP&D’S PERFORMANCE

8

 

 

 5.1

- Conditions

8

 5.2

- Accuracy of Representations

8

 5.3

- Performance

8

 5.4

- Absence of Litigation

8

 5.5

- Officer’s Certificate

9

 5.6

- Payment of Liabilities

9

 5.7

- Corporate Action

9

 

 

ARTICLE VI - CONDITIONS PRECEDENT TO SUB-URBAN’S PERFORMANCE

9

 

 

 6.1

- Conditions

9

 6.2

- Accuracy of Representations

9

 6.3

- Performance

9

 6.4

- Absence of Litigation

9

 6.5

- Officer’s Certificate

9

 6.6

- Directors of DP&D.

10

 6.7

- Officers of DP&D.

10

 6.8

- Corporate Action

10

 

--------------------------------------------------------------------------------

 

 

Page

 

 

ARTICLE VII - CLOSING

10

 

 

 7.1

- Closing

10

 

 

ARTICLE VIII - COVENANTS SUBSEQUENT TO THE CLOSING DATE

10

 

 

 8.1

- Registration and Listing

11

 8.2

- Stock Option Plan

11

 

 

ARTICLE IX - MISCELLANEOUS

11

 

 

 9.1

- Captions and Headings

11

 9.2

- No Oral Change

11

 9.3

- Non-Waiver

11

 9.4

- Time of Essence

11

 9.5

- Entire Agreement

11

 9.6

- Choice of Law

11

 9.7

- Counterparts

11

 9.8

- Notices

12

 9.9

- Binding Effect

12

 9.10

- Mutual Cooperation

12

 9.11

- Finders

12

 9.12

- Announcements

12

 9.13

- Expenses

12

 9.14

- Survival of Representations and Warranties

12

 9.15

- Exhibits

13

 9.16

- Legal Counsel

12

 9.17

- Termination, Amendment and Waiver

13

 

 

 

 

Signatures

14

 

--------------------------------------------------------------------------------

 

EXHIBITS

 

 

Allocation of Securities

Exhibit

1.1

 

Subscription Agreement

Exhibit

1.2

 

Financial Statements of Sub-Urban

Exhibit

2.5

 

Material Contracts of Sub-Urban

Exhibit

2.17

 

Financial Statements of DP&D

Exhibit

3.5

 

Exception Schedule of Sub-Urban

Exhibit

 

 

List of Sub-Urban Intellectual Property Rights

Exhibit

2.10

 

--------------------------------------------------------------------------------

 

AGREEMENT

 

AGREEMENT made this 11th day of May, 2006, by and between Sub-Urban Brands,
Inc., (formerly known as DP&D, INC.), a Nevada corporation (“DP&D”), SUB-URBAN
INDUSTRIES, INC., a California corporation (“Sub-Urban”), and the security
holders of Sub-Urban (the “Sub-Urban Security Holders”) who are listed on
Exhibit 1.1 hereto and have executed Subscription Agreements in the form
attached in Exhibit 1.2, hereto.

 

WHEREAS, DP&D desires to acquire all of the issued and outstanding securities of
Sub-Urban from the Sub-Urban Security Holders in exchange for newly issued
unregistered securities of DP&D;

 

WHEREAS, Sub-Urban desires to assist DP&D in acquiring all of the issued and
outstanding securities of Sub-Urban pursuant to the terms of this Agreement; and

 

WHEREAS, the Sub-Urban Security Holders, by execution of Exhibit 1.2 hereto,
agree to exchange all securities they hold in Sub-Urban for securities of DP&D.

 

NOW, THEREFORE, in consideration of the mutual promises, covenants and
representations contained herein, THE PARTIES HERETO AGREE AS FOLLOWS:

 

ARTICLE I

 

Exchange of Securities

 

1.1           Issuance of Securities. Subject to the terms and conditions of
this Agreement, DP&D agrees to issue and exchange (i) 31,673,363 fully paid and
nonassessable unregistered shares of DP&D’s $.001 par value common stock (the
“DP&D Shares”) for all 31,673,363 issued and outstanding shares of the no par
value common stock of Sub-Urban (the “Sub-Urban Shares”) held by the Sub-Urban
Security Holders and (ii) $2,734,900 face amount of convertible promissory notes
convertible into the common stock of DP&D at a range of prices from $0.250 per
share to $0.375 per share, and subject to respective conversion price
adjustments, in exchange for a like face amount of promissory notes held by the
Sub-Urban Security Holders. All DP&D securities will be issued directly to the
Sub-Urban Security Holders on the Closing Date, as hereinafter defined, pursuant
to the schedule set forth in Exhibit 1.1. All promissory notes of DP&D exchanged
for promissory notes of Sub-Urban will be convertible into the common stock of
DP&D at the same exercise price per share as provided in the promissory notes of
Sub-Urban. DP&D will also issue to the Sub-Urban Security Holders stock options
and warrants on a one-for-one basis for outstanding stock options and warrants
of Sub-Urban and exercisable at the same price and terms per share as the stock
options and warrants of Sub-Urban. The common stock, promissory notes, stock
options and warrants of DP&D are collectively referred to as the “DP&D
Securities.”

 

1.2           Exemption from Registration. The parties hereto intend that all
DP&D Securities to be issued to the Sub-Urban Security Holders shall be exempt
from the registration

 

1

--------------------------------------------------------------------------------

 

requirements of the Securities Act of 1933, as amended (the “Act”), pursuant to
Section 4(2) and/or Regulation D of the Act and the rules and regulations
promulgated thereunder. In furtherance thereof, each of the Sub-Urban Security
Holders will execute and deliver to DP&D on the closing date of this Agreement
(the “Closing Date”) a copy of the Subscription Agreement set forth in Exhibit
1.2 hereto.

 

1.3           Corporate Action by DP&D. On or before the Closing Date, DP&D
shall (i) change its name to Sub-Urban Brands, Inc, (ii) file its Quarterly
Report on Form 10-QSB for the quarter ended March 31, 2006 with the Securities
and Exchange Commission and (iii) divest itself of any and all business
operations by conveying all of its assets to Dina Staheli, and Harold Sciotto in
exchange for the return and cancellation of 145,000,000 and 7,250,000 shares of
DP&D’s common stock, respectively.

 

ARTICLE II

 

Representations and Warranties of Sub-Urban

 

Sub-Urban hereby represents and warrants to DP&D that:

 

2.1           Organization. Sub-Urban is a corporation duly organized, validly
existing and in good standing under the laws of California, has all necessary
corporate powers to own its properties and to carry on its business as now owned
and operated by it, and is duly qualified to do business and is in good standing
in each of the states where its business requires qualification.

 

2.2           Capital. The authorized capital stock of Sub-Urban consists of
90,000,000 authorized shares of no par value common stock, of which 31,673,363
shares of common stock will be outstanding on the Closing Date and 10,000,000
authorized shares of preferred stock, none of which will be outstanding on the
Closing Date. All of the outstanding common stock of Sub-Urban is duly and
validly issued, fully paid and nonassessable. Except as disclosed on the
Exception Schedule Exhibit, there are no outstanding subscriptions, options,
rights, warrants, debentures, instruments, convertible securities or other
agreements or commitments obligating Sub-Urban to issue any additional shares of
its capital stock of any class, except promissory notes convertible into
10,819,094 shares of Sub-Urban common stock, options to purchase an aggregate of
7,732,698 shares of Sub-Urban common stock and warrants to purchase an aggregate
of 16,822,245 shares of Sub-Urban common stock. All common stock issuable under
Sub-Urban’s convertible promissory notes, options and warrants will be
convertible on the Closing Date into a like amount of common stock issuable by
DP&D.

 

2.3           Subsidiaries. Sub-Urban does not have any subsidiaries or own any
interest in any other enterprise.

 

2.4           Directors and Officers. The names and titles of the directors and
officers of Sub-Urban as of the date of this Agreement are as follows:  Joe
Shortal, Chief Executive Officer and Director; Meredith Feldman, President; and
Mark Jacobs, Secretary. The following are slated to join Sub-Urban in the
respective capacities upon the closing of this Agreement and issuance of a
Directors and Officers Liability Policy: Jack Mott, Chief Financial Officer,
Chief Operating

 

2

--------------------------------------------------------------------------------

 

Officer and Director; John Koufis, Director; David Howitt, Director; and Kenard
Gibbs, Director.

 

2.5           Financial Statements. Exhibit 2.5 hereto consists of the audited
financial statements of Sub-Urban for the years ended December 31, 2003, 2004
and 2005 and unaudited, unreviewed financial statements for the three months
ended March 31, 2006 (the “Sub-Urban Financial Statements”). The Sub-Urban
Financial Statements have been prepared in accordance with generally accepted
accounting principles and practices consistently followed by Sub-Urban
throughout the periods indicated, and fairly present the financial position of
Sub-Urban as of the dates of the balance sheets included in the Sub-Urban
Financial Statements and the results of operations for the periods indicated.
There are no material omissions or nondisclosures in the Sub-Urban Financial
Statements.

 

2.6           Absence of Changes. Since March 31, 2006 there has not been any
material change in the financial condition or operations of Sub-Urban, except as
contemplated by this Agreement. As used in this Agreement, “material” means: 
Any change or effect (or development that, insofar as can be reasonably
foreseen, is likely to result in any change or effect) that causes substantial
increase or diminution in the business, properties, assets, condition (financial
or otherwise) or results of operations of a party. Taken as a whole, material
change shall not include changes in national or international economic
conditions or industry conditions generally; changes or possible changes in
statutes and regulations applicable to a party; or the loss of employees,
customers or suppliers by a party as a direct or indirect consequence of any
announcement relating to this transaction.

 

2.7           Absence of Undisclosed Liabilities. As of March 31, 2006,
Sub-Urban did not have any material debt, liability or obligation of any nature,
whether accrued, absolute, contingent or otherwise, and whether due or to become
due, that is not reflected in the Sub-Urban Financial Statements.

 

2.8           Tax Returns. Sub-Urban has filed all federal, state and local tax
returns required by law and has paid all taxes, assessments and penalties due
and payable. The provisions for taxes, if any, reflected in Exhibit 2.5 are
adequate for the periods indicated. There are no present disputes as to taxes of
any nature payable by Sub-Urban.

 

2.9           Investigation of Financial Condition. Without in any manner
reducing or otherwise mitigating the representations contained herein, DP&D, its
legal counsel and accountants shall have the opportunity to meet with
Sub-Urban’s accountants and attorneys to discuss the financial condition of
Sub-Urban during reasonable business hours and in a manner that does not
interfere with the normal operation of Sub-Urban’s business. Sub-Urban shall
make available to DP&D all books and records of Sub-Urban, provided, however,
that Sub-Urban will be under no obligation to provide any information subject to
confidentiality provisions or waive any privilege associated with any such
information.

 

2.10         Intellectual Property Rights. Sub-Urban owns or has the right to
use all trademarks, service marks, trade names, copyrights and patents material
to its business.

 

3

--------------------------------------------------------------------------------

 

2.11         Compliance with Laws. To the best of Sub-Urban’s knowledge,
Sub-Urban has complied with, and is not in violation of, applicable federal,
state or local statutes, laws and regulations, including federal and state
securities laws, except where such non-compliance would not have a material
adverse impact upon its business or properties.

 

2.12         Litigation. Sub-Urban is not a defendant in any suit, action,
arbitration or legal, administrative or other proceeding, or governmental
investigation which is pending or, to the best knowledge of Sub-Urban,
threatened against or affecting Sub-Urban or its business, assets or financial
condition. Sub-Urban is not in default with respect to any order, writ,
injunction or decree of any federal, state, local or foreign court, department,
agency or instrumentality applicable to it. Sub-Urban is not engaged in any
material litigation to recover monies due to it.

 

2.13         Authority. The Board of Directors of Sub-Urban has authorized the
execution of this Agreement and the consummation of the transactions
contemplated herein, and Sub-Urban has full power and authority to execute,
deliver and perform this Agreement, and this Agreement is a legal, valid and
binding obligation of Sub-Urban and is enforceable in accordance with its terms
and conditions. By execution of Exhibit 1.2, all of the Sub-Urban Security
Holders have agreed to and have approved the terms of this Agreement.

 

2.14         Ability to Carry Out Obligations. To the best of Sub-Urban’s
knowledge, the execution and delivery of this Agreement by Sub-Urban and the
performance by Sub-Urban of its obligations hereunder in the time and manner
contemplated will not cause, constitute or conflict with or result in (a) any
breach or violation of any of the provisions of or constitute a default under
any license, indenture, mortgage, instrument, article of incorporation, bylaw,
or other agreement or instrument to which Sub-Urban is a party, or by which it
may be bound, nor will any consents or authorizations of any party other than
those hereto be required, (b) an event that would permit any party to any
agreement or instrument to terminate it or to accelerate the maturity of any
indebtedness or other obligation of Sub-Urban, or (c) an event that would result
in the creation or imposition of any lien, charge or encumbrance on any asset of
Sub-Urban.

 

2.15         Full Disclosure. None of the representations and warranties made by
Sub-Urban herein or in any exhibit, certificate or memorandum furnished or to be
furnished by Sub-Urban, or on its behalf, contains or will contain any untrue
statement of material fact or omit any material fact the omission of which would
be misleading.

 

2.16         Assets and Liabilities. Sub-Urban’s assets and liabilities are
fully included in Exhibit 2.5 and its assets are not subject to any claims or
encumbrances except as indicated in Exhibit 2.5

 

2.17         Material Contracts. Sub-Urban does not have any material contracts,
except as set forth in Exhibit 2.17.

 

2.18         Indemnification. Sub-Urban agrees to indemnify, defend and hold
DP&D harmless against and in respect of any and all claims, demands, losses,
costs, expenses, obligations, liabilities, damages, recoveries and deficiencies,
including interest, penalties and reasonable attorney fees asserted by third
parties against DP&D or Sub-Urban which arise out of,

 

4

--------------------------------------------------------------------------------

 

or result from (i) any breach by Sub-Urban in performing any of its covenants or
agreements under this Agreement or in any schedule, certificate, exhibit or
other instrument furnished or to be furnished by Sub-Urban under this Agreement,
(ii) a failure of any representation or warranty in this Article II or (iii) any
untrue statement made by Sub-Urban in this Agreement.

 

2.19         Criminal or Civil Acts. For the period of five years prior to the
execution of this Agreement, no executive officer, director or principal
stockholder of Sub-Urban has been convicted of a felony crime, filed for
personal bankruptcy, been the subject of a Commission or NASD judgment or
decree, or is currently the subject to any investigation in connection with a
felony crime or Commission or NASD proceeding.

 

2.20         Restricted Securities. Sub-Urban and the Sub-Urban Security
Holders, by execution of this Agreement and of Exhibit 1.2, acknowledge that all
of the DP&D Securities issued by DP&D are restricted securities and none of such
securities may be sold or publicly traded except in accordance with the
provisions of the Act.

 

ARTICLE III

 

Representations and Warranties of DP&D

 

DP&D represents and warrants to Sub-Urban that:

 

3.1           Organization. DP&D is a corporation duly organized, validly
existing and in good standing under the laws of Nevada, has all necessary
corporate powers to carry on its business, and is duly qualified to do business
and is in good standing in each of the states where its business requires
qualification.

 

3.2           Capital. The authorized capital stock of DP&D on the Closing Date
will consist of 190,000,000 shares of $.001 par value common stock, of which
14,500,000 shares of common stock will be issued and outstanding and 10,000,000
shares of $.001 par value preferred stock, none of which will be outstanding.
All of DP&D’s outstanding securities are duly and validly issued, fully paid and
nonassessable. There are no outstanding subscriptions, options, rights,
warrants, debentures, instruments, convertible securities or other agreements or
commitments obligating DP&D to issue any additional shares of its capital stock
of any class, except as required under this Agreement.

 

3.3           Subsidiaries. DP&D does not have any subsidiaries or own any
interest in any other enterprise.

 

3.4           Directors and Officers. The sole executive officer and director of
DP&D is Dina Staheli, Chief Executive Officer and Director.

 

3.5           Financial Statements. Exhibit 3.5 hereto consists of the audited
financial statements of DP&D for the years ended December 31, 2004 and 2005 and
the unaudited financial statements of DP&D for the three months ended March 31,
2006 (the “DP&D Financial Statements”). The DP&D Financial Statements have been
prepared in accordance with generally

 

5

--------------------------------------------------------------------------------

 

accepted accounting principles and practices consistently followed by DP&D
throughout the periods indicated, and fairly present the financial position of
DP&D as of the date of the balance sheets included in the DP&D Financial
Statements and the results of operations for the periods indicated. There are no
material omissions or nondisclosures in the DP&D Financial Statements.

 

3.6           Absence of Changes. Since March 31, 2006, there has not been any
material change (as defined in Section 2.6) in the financial condition or
operations of DP&D, except as contemplated by this Agreement.

 

3.7           Absence of Undisclosed Liabilities. As of March 31, 2006, DP&D did
not have any material debt, liability or obligation of any nature, whether
accrued, absolute, contingent or otherwise, and whether due or to become due,
that is not reflected in the DP&D Financial Statements.

 

3.8           Tax Returns. Within the times and in the manner prescribed by law,
DP&D has filed all federal, state and local tax returns required by law and has
paid all taxes, assessments, and penalties due and payable.

 

3.9           Investigation of Financial Condition. Without in any manner
reducing or otherwise mitigating the representations contained herein,
Sub-Urban, its legal counsel and accountants shall have the opportunity to meet
with DP&D’s accountants and attorneys to discuss the financial condition of
DP&D. DP&D shall make available to Sub-Urban all books and records of DP&D.

 

3.10         Intellectual Property Rights. DP&D does not have any patents,
trademarks, service marks, trade names, copyrights or other intellectual
property rights.

 

3.11         Compliance with Laws. DP&D has complied with, and is not in
violation of, applicable federal, state or local statutes, laws or regulations
including federal and state securities laws.

 

3.12         Litigation. DP&D is not a defendant in any suit, action,
arbitration, or legal, administrative or other proceeding, or governmental
investigation which is pending or, to the best knowledge of DP&D, threatened
against or affecting DP&D or its business, assets or financial condition. DP&D
is not in default with respect to any order, writ, injunction or decree of any
federal, state, local or foreign court, department, agency or instrumentality
applicable to it. DP&D is not engaged in any material litigation to recover
monies due to it.

 

3.13         Authority. The Board of Directors of DP&D has authorized the
execution of this Agreement and the transactions contemplated herein, and DP&D
has full power and authority to execute, deliver and perform this Agreement, and
this Agreement is the legal, valid and binding obligation of DP&D, and is
enforceable in accordance with its terms and conditions.

 

3.14         Ability to Carry Out Obligations. The execution and delivery of
this Agreement by DP&D and the performance by DP&D of its obligations hereunder
will not cause, constitute or conflict with or result in (a) any breach or
violation of any of the provisions of or constitute a

 

6

--------------------------------------------------------------------------------

 

default under any license, indenture, mortgage, instrument, article of
incorporation, bylaw or other agreement or instrument to which DP&D is a party,
or by which it may be bound, nor will any consents or authorization of any party
other than those hereto be required, (b) an event that would permit any party to
any agreement or instrument to terminate it or to accelerate the maturity of any
indebtedness or other obligation of DP&D, or (c) an event that would result in
the creation or imposition of any lien, charge or encumbrance on any asset of
DP&D.

 

3.15         Full Disclosure. None of the representations and warranties made by
DP&D herein, or in any exhibit, certificate or memorandum furnished or to be
furnished by DP&D or on its behalf, contains or will contain any untrue
statement of material fact or omit any material fact the omission of which would
be misleading.

 

3.16         Assets and Liabilities. On the Closing Date DP&D will have no
assets or liabilities.

 

3.17         Material Contracts. DP&D has no material contracts.

 

3.18         Indemnification. DP&D agrees to indemnify, defend and hold
Sub-Urban harmless against and in respect of any and all claims, demands,
losses, costs, expenses, obligations, liabilities, damages, recoveries and
deficiencies, including interest, penalties, and reasonable attorney fees
asserted by third parties against DP&D or Sub-Urban, that it shall incur or
suffer, which arise out of, or result from (i) any breach by DP&D in performing
any of its covenants or agreements in this Agreement or in any schedule,
certificate, exhibit or other instrument furnished or to be furnished by DP&D
under this Agreement, (ii) a failure of any representation or warranty in this
Article III, or (iii) any untrue statement made by DP&D in this Agreement.

 

3.19         Criminal or Civil Acts. For a period of five years prior to the
execution of this Agreement, no executive officer, director or principal
stockholder of DP&D has been convicted of a felony crime, filed for personal
bankruptcy, been the subject of a Securities and Exchange Commission
(“Commission”) or NASD judgment or decree, or is currently the subject to an
investigation in connection with any felony crime or Commission or NASD
proceeding.

 

3.20         Bulletin Board Trading Status. DP&D shall be in compliance with all
requirements for, and its common stock shall be quoted on, the Over the Counter
Electronic Bulletin Board system on the Closing Date, such that the common stock
of DP&D may continue to be so quoted without interruption following the Closing.

 

ARTICLE IV

 

Covenants Prior to the Closing Date

 

4.1           Investigative Rights. Prior to the Closing Date, each party shall
provide to the other party, and such other party’s counsel, accountants,
auditors and other authorized representatives, full access during normal
business hours and upon reasonable advance written notice to all of each party’s
properties, books, contracts, commitments and records for the

 

7

--------------------------------------------------------------------------------

 

purpose of examining the same. Each party shall furnish the other party with all
information concerning each party’s affairs as the other party may reasonably
request. If during the investigative period one party learns that a
representation of the other party was not accurate, no such claim may be
asserted by the party so learning that a representation of the other party was
not accurate.

 

4.2           Conduct of Business. Prior to the Closing Date, each party shall
conduct its business in the normal course and shall not sell, pledge or assign
any assets without the prior written approval of the other party, except in the
normal course of business. Neither party shall amend its Articles of
Incorporation or Bylaws (except as may be described in this Agreement), declare
dividends, redeem or sell stock or other securities. Neither party shall enter
into negotiations with any third party or complete any transaction with a third
party involving the sale of any of its assets or the exchange of any of its
common stock.

 

4.3           Confidential Information. Each party will treat all nonpublic,
confidential and trade secret information received from the other party as
confidential, and such party shall not disclose or use such information in a
manner contrary to the purposes of this Agreement. Moreover, all such
information shall be returned to the other party in the event this Agreement is
terminated.

 

4.4           Notice of Non-Compliance. Each party shall give prompt notice to
the other party of any representation or warranty made by it in this Agreement
becoming untrue or inaccurate in any respect or the failure by it to comply with
or satisfy in any material respect any covenant, condition or agreement to be
complied with or satisfied by it under this Agreement.

 

ARTICLE V

 

Conditions Precedent to DP&D’s Performance

 

5.1           Conditions. DP&D’s obligations hereunder shall be subject to the
satisfaction at or before the Closing of all the conditions set forth in this
Article V. DP&D may waive any or all of these conditions in whole or in part
without prior notice; provided, however, that no such waiver of a condition
shall constitute a waiver by DP&D of any other condition of or any of DP&D’s
other rights or remedies, at law or in equity, if Sub-Urban shall be in default
of any of its representations, warranties or covenants under this Agreement.

 

5.2           Accuracy of Representations. Except as otherwise permitted by this
Agreement, all representations and warranties by Sub-Urban in this Agreement or
in any written statement that shall be delivered to DP&D by Sub-Urban under this
Agreement shall be true and accurate on and as of the Closing Date as though
made at that time.

 

5.3           Performance. Sub-Urban shall have performed, satisfied and
complied with all covenants, agreements and conditions required by this
Agreement to be performed or complied with by it on or before the Closing Date.

 

8

--------------------------------------------------------------------------------

 

5.4           Absence of Litigation. No action, suit, or proceeding, including
injunctive actions, before any court or any governmental body or authority,
pertaining to the transaction contemplated by this Agreement or to its
consummation, shall have been instituted or threatened against Sub-Urban on or
before the Closing Date.

 

5.5           Officer’s Certificate. Sub-Urban shall have delivered to DP&D a
certificate dated the Closing Date signed by the Chief Executive Officer of
Sub-Urban certifying that each of the conditions specified in this Article has
been fulfilled and that all of the representations set forth in Article II are
true and correct as of the Closing Date.

 

5.6           Payment of Liabilities. On or before the Closing, DP&D shall have
paid any outstanding obligations and liabilities of DP&D incurred through the
Closing Date.

 

5.7           Corporate Action. Sub-Urban shall have obtained the approval of
the Sub-Urban Security Holders for the transaction contemplated by this
Agreement.

 

5.8           Preferred Shares. Sub-Urban shall have converted all of its
outstanding Series A Preferred Stock to Common Stock.

 

ARTICLE VI

 

Conditions Precedent to Sub-Urban’s Performance

 

6.1           Conditions. Sub-Urban’s obligations hereunder shall be subject to
the satisfaction at or before the Closing of all the conditions set forth in
this Article VI. Sub-Urban may waive any or all of these conditions in whole or
in part without prior notice; provided, however, that no such waiver of a
condition shall constitute a waiver by Sub-Urban of any other condition of or
any of Sub-Urban’s rights or remedies, at law or in equity, if DP&D shall be in
default of any of its representations, warranties or covenants under this
Agreement.

 

6.2           Accuracy of Representations. Except as otherwise permitted by this
Agreement, all representations and warranties by DP&D in this Agreement or in
any written statement that shall be delivered to Sub-Urban by DP&D under this
Agreement shall be true and accurate on and as of the Closing Date as though
made at that time.

 

6.3           Performance. DP&D shall have performed, satisfied and complied
with all covenants, agreements and conditions required by this Agreement to be
performed or complied with by it on or before the Closing Date.

 

6.4           Absence of Litigation. No action, suit or proceeding before any
court or any governmental body or authority, pertaining to the transaction
contemplated by this Agreement or to its consummation, shall have been
instituted or threatened against DP&D on or before the Closing Date.

 

6.5           Officer’s Certificate. DP&D shall have delivered to Sub-Urban a
certificate dated the Closing Date signed by the Chief Executive Officer of DP&D
certifying that each of the

 

9

--------------------------------------------------------------------------------

 

conditions specified in this Article has been fulfilled and that all of the
representations set forth in Article III are true and correct as of the Closing
Date.

 

6.6           Directors of DP&D. On the Closing Date, the Board of Directors of
DP&D shall elect the directors of Sub-Urban to DP&D’s Board of Directors and
then shall resign as directors.

 

6.7           Officers of DP&D. On the Closing Date, the newly constituted Board
of Directors of DP&D shall elect such officers of DP&D as set forth in Section
2.4.

 

6.8           Corporate Action. DP&D shall have completed the corporate action
set forth in Section 1.3.

 

ARTICLE VII

 

Closing

 

7.1           Closing. The Closing of this Agreement shall be held at the
offices of Gary A. Agron, DP&D’s counsel, at any mutually agreeable time and
date (the “Closing Date”) prior to May 12, 2006, unless extended by mutual
agreement. At the Closing:

 

(a)           Sub-Urban shall deliver to DP&D copies of Exhibit 1.2 executed by
all of the Sub-Urban Security Holders together with Sub-Urban certificates or
documentation representing (i) 30,981,410 shares of Sub-Urban common stock, with
a conversion adjusted quantity of 31,673,363 (ii) $2,734,900 face amount of
Sub-Urban convertible promissory notes, (iii) 15,878,603 common stock purchase
warrants, with a conversion adjusted quantity of 16,822,245, and (iv) 7,732,698
stock options, all duly endorsed to DP&D;

 

(b)           DP&D shall deliver to the Sub-Urban Security Holders DP&D
certificates representing (i) 31,673.363 shares of DP&D’s common stock, (ii)
$2,734,900 face amount of DP&D convertible promissory notes, (iii) 15,878,603
common stock purchase warrants and (iv) 7,732.698 stock options, all pursuant to
the computations set forth in Exhibit 1.1 hereto;

 

(c)           DP&D shall deliver (i) the officer’s certificate described in
Section 6.5, (ii) a signed consent and/or minutes of its directors approving
this Agreement and (iii) resignations and releases from its executive officers
and directors pursuant to Sections 6.6 and 6.7;

 

(d)           Sub-Urban shall deliver (i) the officer’s certificate described in
Section 5.5 and (ii) a signed consent and/or minutes of its shareholders and
directors approving this Agreement.

 

10

--------------------------------------------------------------------------------

 

ARTICLE VIII

 

Covenants Subsequent to the Closing Date

 

8.1           Registration and Listing. Following the Closing Date, DP&D shall
use its best efforts to:

 

(a)           Continue DP&D’s common stock quotation on the Over the Counter
Electronic Bulletin Board system; and

 

(b)           List DP&D’s securities in Standard & Poor’s OTC or Corporate
Manual.

 

8.2           Stock Option Plan. Following the Closing Date, DP&D shall adopt a
stock option or other securities incentive plan as its Board of Directors shall
reasonably determine, which plan shall provide identical stock options and other
incentives as were contained in Sub-Urban’s securities incentive plan prior to
the Closing Date.

 

ARTICLE IX

 

Miscellaneous

 

9.1           Captions and Headings. The article and paragraph headings
throughout this Agreement are for convenience and reference only and shall not
define, limit or add to the meaning of any provision of this Agreement.

 

9.2           No Oral Change. This Agreement and any provision hereof may not be
waived, changed, modified or discharged orally, but only by an agreement in
writing signed by the party against whom enforcement of any such waiver, change,
modification or discharge is sought.

 

9.3           Non-Waiver. The failure of any party to insist in any one or more
cases upon the performance of any of the provisions, covenants or conditions of
this Agreement or to exercise any option herein contained shall not be construed
as a waiver or relinquishment for the future of any such provisions, covenants
or conditions. No waiver by any party of one breach by another party shall be
construed as a waiver with respect to any other subsequent breach.

 

9.4           Time of Essence. Time is of the essence of this Agreement and of
each and every provision hereof.

 

9.5           Entire Agreement. This Agreement contains the entire Agreement and
understanding between the parties hereto and supersedes all prior agreements and
understandings.

 

9.6           Choice of Law. This Agreement and its application shall be
governed by the laws of the state of Nevada.

 

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

 

11

--------------------------------------------------------------------------------

 

9.8           Notices. All notices, requests, demands and other communications
under this Agreement shall be in writing and shall be deemed to have been duly
given on the date of service if served personally on the party to whom notice is
to be given, or on the third day after mailing if mailed to the party to whom
notice is to be given, by first class mail, registered or certified, postage
prepaid, and properly addressed as follows:

 

DP&D:

 

DP&D, Inc.

4251 East Melody Drive

Higley, Arizona  85236

Attn:  Dina Staheli, Chief Executive Officer

 

Sub-Urban:

 

Sub-Urban Industries, Inc.

2222 E. Washington Blvd., Suite B

Los Angeles, California  90021

Attn:  Joe Shortal, Chief Executive Officer

 

9.9           Binding Effect. This Agreement shall inure to and be binding upon
the heirs, executors, personal representatives, successors and assigns of each
of the parties to this Agreement.

 

9.10         Mutual Cooperation. The parties hereto shall cooperate with each
other to achieve the purpose of this Agreement and shall execute such other and
further documents and take such other and further actions as may be necessary or
convenient to effect the transaction described herein.

 

9.11         Finders. There are no finders in connection with this transaction.

 

9.12         Announcements. The parties will consult and cooperate with each
other as to the timing and content of any public announcements regarding this
Agreement.

 

9.13         Expenses. Each party will bear their own expenses, including legal
fees incurred in connection with this Agreement. The Sub-Urban Security Holders
shall not be responsible for any costs incurred in connection with the
transaction contemplated by this Agreement.

 

9.14         Survival of Representations and Warranties. The representations,
warranties, covenants and agreements of the parties set forth in this Agreement
or in any instrument, certificate, opinion or other writing providing for in it,
shall survive the Closing.

 

9.15         Exhibits. As of the execution hereof, the parties have provided
each other with the Exhibits described herein. Any material changes to the
Exhibits shall be immediately disclosed to the other party.

 

12

--------------------------------------------------------------------------------

 

9.16         Legal Counsel. Gary A. Agron, Esq., has represented Sub-Urban in
connection with this Agreement. DP&D has been represented by counsel of its
choice. Both parties acknowledge that Gary A. Agron has represented affiliates
of DP&D in the past, and both parties waive any conflict of interest that may
result from such prior representation.

 

9.17         Termination, Amendment and Waiver.

 

(a)  Termination. This Agreement may be terminated at any time prior to the
Closing Date, whether before or after approval of matters presented in
connection with the share exchange by the stockholders of DP&D or by the
stockholders of Sub-Urban:

 

(1)           by mutual written consent of Sub-Urban and DP&D;

 

(2)           by either Sub-Urban or DP&D;

 

(i)            if the stockholders of Sub-Urban fail to agree to the exchange of
securities with DP&D or,

 

(ii)           if any court of competent jurisdiction or any governmental,
administrative or regulatory authority, agency or body shall have issued an
order, decree or ruling or taken any other action permanently enjoining,
restraining or otherwise prohibiting the transactions contemplated by this
Agreement.

 

(3)           by Sub-Urban, if DP&D breaches any of its representations or
warranties hereof or fails to perform in any material respect any of its
covenants, agreements or obligations under this Agreement; and

 

(4)           by DP&D, if Sub-Urban breaches any of its representations or
warranties hereof or fails to perform in any material respect any of its
covenants, agreements or obligations under this Agreement.

 

(b)  Effect of Termination. In the event of termination of this Agreement by
either DP&D or Sub-Urban, as provided herein, this Agreement shall forthwith
become void and have no effect, without any liability or obligation on the part
of Sub-Urban or DP&D, and such termination shall not relieve any party hereto
for any intentional breach prior to such termination by a party hereto of any of
its representations or warranties or any of its covenants or agreements set
forth in this Agreement.

 

(c)  Extension; Waiver. At any time prior to the Closing Date, the parties may,
to the extent legally allowed, (a) extend the time for the performance of any of
the obligation of the other acts of the other parties, (b) waive any
inaccuracies in the representations and warranties contained herein or in any
document delivered pursuant hereto or waive compliance with any of the
agreements or conditions contained herein. Any agreement on the part of a party
to any such extension or waiver shall be valid only if set forth in an
instrument in writing signed on behalf of

 

13

--------------------------------------------------------------------------------

 

such party. The failure of any party to this Agreement to assert any of its
rights under this Agreement or otherwise shall not constitute a waiver of such
rights.

 

In witness whereof, the parties have executed this Agreement on the date
indicated above.

 

DP&D, INC.

SUB-URBAN INDUSTRIES, INC.

 

 

By:

 

 

By:

 

 

 

Dina Staheli

 

 

Joe Shortal, Chief Executive Officer

 

Chief Executive Officer

 

 

 

14

--------------------------------------------------------------------------------

EXHIBIT 1.1

SCHEDULE OF SUB-URBAN COMMON STOCKHOLDERS

AND

ALLOCATION OF DP&D COMMON SHARES

 

Name

 

SUI Cert#

 

Number of Sub-
Urban Common
Shares
Exchanged

 

Number of DP&D
Common Shares to be
Issued

 

James Blondell

 

C-1

 

5,779,600

 

5,779,600

 

Tom Blondell Sr.

 

C-1

 

200,000

 

200,000

 

Ilene Hartle

 

C-1

 

125,000

 

125,000

 

Tom Blondell Jr.

 

C-1

 

100,000

 

100,000

 

Caeser Luisi

 

C-1

 

50,000

 

50,000

 

Robert Foley

 

C-1

 

100,000

 

100,000

 

Joe Shortal

 

C-2

 

5,233,200

 

5,233,200

 

Aaron Apodaca

 

C-9

 

1,869,000

 

1,869,000

 

Mark Jacobs

 

C-4

 

1,495,200

 

1,495,200

 

Matt Blondell

 

C-3

 

1,121,400

 

1,121,400

 

Matt Blondell

 

C-10

 

373,800

 

373,800

 

Oscar Turner

 

C-5

 

560,700

 

560,700

 

Oscar Turner

 

C-11

 

373,800

 

373,800

 

Stephen Kinder

 

C-12

 

934,500

 

934,500

 

Barnes Morris Klein Yorn

 

C-6

 

93,450

 

93,450

 

Barnes Morris Klein Yorn

 

C-13

 

186,900

 

186,900

 

David A. Krintzman

 

C-14

 

93,450

 

93,450

 

RDK Roth IRA

 

C-16

 

73,426

 

73,426

 

RDK Roth IRA

 

C-17

 

73,426

 

73,426

 

RDK trust

 

C-15

 

66,750

 

66,750

 

John Stamatis

 

CS-55

 

640,800

 

640,800

 

Romeo DiBatista Jr.

 

CS-48

 

33,334

 

33,334

 

Gamy Trust

 

20

 

400,000

 

400,000

 

Lea Roussos

 

21

 

400,000

 

400,000

 

Pacific Tek

 

22

 

200,000

 

200,000

 

Michael Shortal

 

CS-51

 

53,400

 

53,400

 

Michael Burchard

 

CS-24

 

16,500

 

16,500

 

Stan Snow

 

CS-23

 

16,500

 

16,500

 

Leonard Koenig

 

CS-46

 

133,500

 

133,500

 

Michal Cohen

 

CS-47

 

133,500

 

133,500

 

Michael Simon

 

CS-50

 

53,400

 

53,400

 

MGAY, Inc.

 

CS-58

 

88,000

 

88,000

 

Amos Varsha

 

C-26

 

44,000

 

44,000

 

MGAY, Inc.

 

C-26S

 

44,000

 

44,000

 

Amos Varsha

 

C-27

 

44,000

 

44,000

 

MGAY, Inc.

 

C-27s

 

44,000

 

44,000

 

 

--------------------------------------------------------------------------------

 

Name

 

SUI Cert#

 

Number of Sub-
Urban Common
Shares
Exchanged

 

Number of DP&D
Common Shares to be
Issued

 

MGAY, Inc.

 

CS-59

 

88,000

 

88,000

 

MGAY, Inc.

 

CS-60

 

960,000

 

960,000

 

Amos Varsha

 

CS-61

 

120,000

 

120,000

 

MGAY, Inc.

 

CS-61S

 

120,000

 

120,000

 

Steve Rosen

 

CS-30

 

40,000

 

40,000

 

Officeworxx

 

CS-30S

 

40,000

 

40,000

 

Officeworxx

 

CS-31

 

96,000

 

96,000

 

Steve Rosen

 

CS-32

 

40,000

 

40,000

 

Steve Rosen

 

CS-32S

 

40,000

 

40,000

 

Officeworxx

 

CS-33

 

96,000

 

96,000

 

Steve Rosen

 

CS-34

 

300,000

 

300,000

 

Officeworxx

 

CS-34S

 

300,000

 

300,000

 

Pacific Tek

 

CS-35

 

80,000

 

80,000

 

Amos Varsha

 

CS-37

 

50,000

 

50,000

 

MGAY, Inc.

 

CS-37s

 

50,000

 

50,000

 

MGAY, Inc.

 

CS-38

 

100,000

 

100,000

 

Amos Varsha

 

CS-39

 

360,000

 

360,000

 

Raymond Tougas

 

CS-39SA

 

150,000

 

150,000

 

MGAY, Inc.

 

CS-39SB

 

210,000

 

210,000

 

Pacific Tek

 

CS-40

 

40,000

 

40,000

 

Maryam Seilabi

 

CS-52

 

14,134

 

14,134

 

John Stamatis

 

C65

 

1,040,000

 

1,040,000

 

HJG Parntership

 

CS-56

 

33,334

 

33,334

 

Brian Duffy

 

CS-45

 

520,000

 

520,000

 

Steve Decastro

 

CS-53

 

10,000

 

10,000

 

Cfour Partners

 

CS-54

 

120,000

 

120,000

 

Joe Shortal

 

CS-62

 

1,209,458

 

1,209,458

 

Oscar Turner

 

CS63

 

36,438

 

36,438

 

Vanessa Du

 

C66

 

81,600

 

81,600

 

Country Club Auto Spa

 

C64

 

100,000

 

100,000

 

Cfour Partners

 

CS-57

 

120,000

 

120,000

 

Michael E. Kapsch

 

CS-68

 

500,000

 

500,000

 

John Stamatis

 

CS-67

 

500,000

 

500,000

 

John Stamatis

 

SAP-01

 

96,862

 

96,862

 

Michael E. Kapsch

 

SAP-02

 

387,443

 

387,443

 

John Stamatis

 

SAP-03

 

289,629

 

289,629

 

Michael Episcope

 

SAP-04

 

386,074

 

386,074

 

Michael Cohen & Pamela Cohen

 

SAP-05

 

308,860

 

308,860

 

Michael Manderson & Kristine Manderson

 

SAP-06

 

384,214

 

384,214

 

James P. Hinkamp

 

SAP-07

 

76,470

 

76,470

 

Joel Leonard TTEE, Joel Leonard Trust

 

SAP-08

 

191,078

 

191,078

 

Michael H. Crane

 

SAP-09

 

95,052

 

95,052

 

Lisa Shumacher

 

SAP-10

 

95,052

 

95,052

 

Wayne J. Friedman

 

SAP-11

 

95,052

 

95,052

 

 

--------------------------------------------------------------------------------

 

Name

 

SUI Cert#

 

Number of Sub-
Urban Common
Shares
Exchanged

 

Number of DP&D
Common Shares to be
Issued

 

Robert J. Winslow

 

SAP-12

 

95,052

 

95,052

 

Kelly Walker

 

SAP-13

 

94,733

 

94,733

 

Andrew Leszczynski

 

SAP-14

 

132,625

 

132,625

 

Michael Shortal

 

SAP-15

 

131,667

 

131,667

 

Total Common

 

 

 

31,673,363

 

31,673,363

 

 

--------------------------------------------------------------------------------

 

SCHEDULE OF SUB-URBAN CONVERTIBLE

PROMISSORY NOTES EXCHANGED FOR

DP&D CONVERTIBLE PROMISSORY NOTES

 

Name of Convertible Note Holder

 

Agreement date

 

Face Amount of Convertible
Promissory Notes Exchanged For
Equal Face Amount Of DP&D
Convertible Promissory Notes

 

Hazelton Corp

 

04/21/04

 

 

$

100,000

 

HJG Investments

 

05/11/04

 

 

$

100,000

 

Lower East Investments

 

06/01/04

 

 

$

150,000

 

Andrew Leszczynski

 

06/17/04

 

 

$

45,000

 

Lower East Investments

 

06/23/04

 

 

$

150,000

 

John Stamatis

 

07/30/04

 

 

$

100,000

 

HJG Investments

 

09/03/04

 

 

$

50,000

 

Lower East Investments

 

09/03/04

 

 

$

50,000

 

Michael Shortal

 

09/24/04

 

 

$

20,000

 

Out of Control

 

10/28/04

 

 

$

100,000

 

Out of Control

 

11/05/04

 

 

$

25,000

 

Maryam Seilabi

 

02/24/05

 

 

$

5,300

 

Hazelton Corp

 

03/09/05

 

 

$

25,000

 

ChicagoLand Consulting

 

04/07/05

 

 

$

12,500

 

ITC Options, inc

 

04/07/05

 

 

$

12,500

 

Sean Bruce

 

04/15/05

 

 

$

5,000

 

Keith Lambert

 

04/15/05

 

 

$

10,000

 

Michael Cohen

 

04/15/05

 

 

$

25,000

 

Elizabeth Jackson

 

04/15/05

 

 

$

10,000

 

Kelly Walker

 

04/15/05

 

 

$

12,500

 

Robert Windslow

 

04/15/05

 

 

$

12,500

 

Alexandra Byrne

 

04/27/05

 

 

$

10,000

 

Brian Duffy

 

04/28/05

 

 

$

65,000

 

Bill and Elaine Kouruklis

 

05/27/05

 

 

$

25,000

 

John Stamatis

 

06/30/05

 

 

$

50,000

 

Mike Kapsch

 

07/11/05

 

 

$

50,000

 

Paul Birmingham

 

08/01/05

 

 

$

20,000

 

Andrew Earl

 

08/01/05

 

 

$

25,000

 

Cris Deitz

 

08/01/05

 

 

$

25,000

 

Island Capital Ventures

 

08/01/05

 

 

$

15,000

 

Cris Deitz

 

09/16/05

 

 

$

5,000

 

Nick Corasis

 

09/19/05

 

 

$

25,000

 

Laurent A. Cohen

 

09/26/05

 

 

$

25,000

 

Tiffany Stromeyer

 

10/10/05

 

 

$

20,000

 

John Stamatis

 

11/15/05

 

 

$

50,000

 

Michael E. Kapsch

 

10/27/05

 

 

$

50,000

 

Michael Shortal

 

01/23/06

 

 

$

3,600

 

Eli Russo

 

02/10/06

 

 

$

1,000

 

Donald Wilson Trust 2002

 

02/22/06

 

 

$

500,000

 

Vision Capital

 

04/06/06

 

 

$

100,000

 

Vision Capital

 

04/18/06

 

 

$

650,000

 

Total Convertible Notes

 

 

 

 

$

2,734,900

 

 

--------------------------------------------------------------------------------

 

SCHEDULE OF SUB-URBAN COMMON STOCK

PURCHASE WARRANTS EXCHANGED FOR

DP&D COMMON STOCK PURCHASE WARRANTS

 

Name of Warrant Holder

 

Agreement date

 

Number of Sub-Urban
Warrants Exchanged For
DP&D Warrants on a
Warrant-For-Warrant Basis
(Excluding Conversion
Adjustments)

 

John Stamatis

 

06/27/03

 

26,700

 

Michael Kapsch

 

06/27/03

 

26,700

 

Michael and Pamela Cohen

 

07/13/03

 

21,360

 

Michael M. Manderson

 

07/30/03

 

26,700

 

MIchael Episcope

 

08/03/03

 

26,700

 

James P. Hinkup

 

08/18/03

 

5,340

 

Joel Leonard

 

08/20/03

 

13,350

 

Michael H. Crane

 

09/01/03

 

6,675

 

Wayne Friedman

 

09/01/03

 

6,675

 

Robert J. Winslow

 

09/01/03

 

6,675

 

Lisa A. Schumacher

 

09/06/03

 

6,675

 

Andrew Leszczynski

 

09/19/03

 

9,345

 

Michael Shortal

 

10/20/03

 

9,345

 

Kelly J. Walker

 

09/04/03

 

6,675

 

Foley

 

06/30/04

 

52,746

 

John Stamatis

 

06/30/04

 

52,746

 

Trandell

 

06/30/04

 

94,946

 

Sonnenshein

 

06/30/04

 

10,547

 

Igleman

 

09/10/04

 

133,742

 

Amos Varsha

 

11/12/04

 

100,000

 

MGAY, Inc.

 

11/12/04

 

100,000

 

Steven Rosen

 

11/19/04

 

100,000

 

OfficeWorxx

 

11/19/04

 

100,000

 

MGAY, Inc.

 

02/02/05

 

200,000

 

Lower East Investments

 

03/31/05

 

200,000

 

John Stamatis

 

06/30/05

 

100,000

 

Mike Kapsch

 

07/11/05

 

100,000

 

Paul Birmingham

 

08/02/05

 

20,000

 

Andrew Earl

 

08/02/05

 

25,000

 

Chris Deitz

 

08/02/05

 

25,000

 

Island Capital

 

08/10/05

 

15,000

 

Chris Deitz

 

09/16/05

 

5,000

 

Nick Corasis

 

09/21/05

 

50,000

 

Laurent Cohen

 

09/15/05

 

25,000

 

Tiffany Ann Stromeyer

 

10/10/05

 

20,000

 

Michael E. Kapsch

 

10/27/05

 

300,000

 

Vista Capital

 

10/27/05

 

1,560

 

John Stamatis

 

11/15/05

 

350,000

 

Michael E. Kapsch

 

11/15/05

 

50,000

 

Brian Duffy

 

12/30/05

 

80,000

 

 

--------------------------------------------------------------------------------

 

Name of Warrant Holder

 

Agreement date

 

Number of Sub-Urban
Warrants Exchanged For
DP&D Warrants on a
Warrant-For-Warrant Basis
(Excluding Conversion
Adjustments)

 

Country Club Auto Spa, LLC

 

12/31/05

 

150,000

 

Trilogy

 

01/15/06

 

600,000

 

Michael E. Kapsch

 

01/11/06

 

50,000

 

John Stamatis

 

01/14/06

 

50,000

 

Michael Shortal

 

01/23/06

 

14,400

 

Pacific Tek

 

02/10/06

 

4,000

 

Donald Wilson Trust 2002

 

02/22/06

 

2,000,000

 

Michael E. Kapsch

 

02/22/06

 

500,000

 

John Stamatis

 

02/22/06

 

500,000

 

Donald Wilson Trust 2002

 

04/11/06

 

2,000,000

 

Vision Capital

 

04/18/06

 

3,000,000

 

Vision Capital

 

04/18/06

 

3,000,000

 

Vision Capital

 

04/18/06

 

1,500,000

 

Total Warrants Excluding Conversion Adjustments

 

 

 

15,878,602

 

 

--------------------------------------------------------------------------------

 

SCHEDULE OF SUB-URBAN STOCK OPTIONS

EXCHANGED FOR DP&D STOCK OPTIONS

 

Name of Stock Option Holder

 

Agreement date

 

Number of Sub-Urban
Stock Options Exchanged
For DP&D Stock Options
on a Stock Option - For -Stock Option Basis

 

Trent Maclean

 

09/17/03

 

632,198

 

Caesarie Montana

 

12/03/03

 

53,400

 

Swirsky

 

06/06/04

 

160,200

 

Andrew Leszczynski

 

07/30/04

 

133,500

 

Meredith Feldman

 

06/21/05

 

3,000,000

 

Jack Mott

 

10/21/05

 

3,600,000

 

Caesarie Montana

 

12/30/05

 

53,400

 

Brad Riedell

 

03/01/06

 

100,000

 

Total Stock Options

 

 

 

7,732,698

 

 

--------------------------------------------------------------------------------

EXHIBIT 1.2

SUBSCRIPTION AGREEMENT

 

In connection with my exchange of (i) no par value common stock of Sub-Urban
Industries, Inc. (“Sub-Urban”), for the $.001 par value common stock of DP&D,
Inc. (“DP&D”), (ii) convertible promissory notes of Sub-Urban for convertible
promissory notes of DP&D, (iii) common stock purchase warrants of Sub-Urban for
common stock purchase warrants of DP&D and (iv) stock options of Sub-Urban for
stock options of DP&D (collectively as to DP&D, the “DP&D Securities”) pursuant
to the Agreement Concerning The Exchange Of Securities By And Among DP&D, Inc.
And Sub-Urban Industries, Inc. And The Security Holders Of Sub-Urban Industries,
Inc. (the “Exchange Agreement”), I acknowledge the matters set forth below and
promise that the statements made herein are true. I understand that DP&D is
relying on my truthfulness in issuing the DP&D Securities to me.

 

I hereby represent to DP&D that I am an “accredited investor” as that term is
defined under the Securities Act of 1933 (the “Act”) and Regulation D, Rule 501,
promulgated thereunder. I further represent to DP&D that I have the full power
and authority to execute, deliver and perform this Subscription Agreement and to
consummate the transactions contemplated hereby. This Subscription Agreement is
a legal, valid and binding obligation of mine, enforceable against me in
accordance with its terms. I own the securities in Sub-Urban that I am
exchanging for the DP&D Securities free and clear of all pledges, liens,
encumbrances, security interests, equities, claims, options, preemptive rights,
rights of first refusal, or any other limitation on my ability to vote the DP&D
Securities or to transfer the DP&D Securities. I have full right, title and
interest in and to the Sub-Urban securities that I am exchanging.

 

I understand that the DP&D Securities are being issued to me in a private
transaction in exchange for my securities in Sub-Urban and in reliance upon the
exemption provided in Section 4(2) and/or Regulation D under the Act for
non-public offerings and pursuant to the Exchange Agreement. I understand that
the DP&D Securities are “restricted” under applicable securities laws and may
not be sold by me except in a registered offering (which may not ever occur) or
in a private transaction like this one. I know this is an illiquid investment
and that therefore I may be required to hold the DP&D Securities for an
indefinite period of time, but under no circumstances less than one year from
the date of their issuance.

 

I am acquiring the DP&D Securities solely for my own account, for long-term
investment purposes only and not with a view to sale or other distribution. I
agree not to dispose of any DP&D Securities unless and until counsel for DP&D
shall have determined that the intended disposition is permissible and does not
violate the Act, any applicable state securities laws or rules and regulations
promulgated thereunder.

 

All information, financial and otherwise, or documentation pertaining to all
aspects of my acquisition of the DP&D Securities and the activities and
financial information of DP&D have been made available to me and my
representatives, if any, and I have had ample opportunity to

 

--------------------------------------------------------------------------------

 

meet with and ask questions of senior officers of DP&D, and I have received
satisfactory answers to any questions I asked.

 

In acquiring the DP&D Securities, I have been afforded access to the Exchange
Agreement and all of the public filings of DP&D made with the Securities and
Exchange Commission and have made such independent investigations of DP&D as I
deemed appropriate. I am an experienced investor, have made speculative
investments in the past and am capable of analyzing the merits of an investment
in the DP&D Securities.

 

I understand that the DP&D Securities are highly speculative, involve a great
degree of risk and should only be acquired by individuals who can afford to lose
their entire investment. Nevertheless, I consider this a suitable investment for
me because I have adequate financial resources and income to maintain my current
standard of living even after my acquisition of the DP&D Securities. I know that
DP&D currently has no assets or liabilities, and that although I could lose my
entire investment, I am acquiring the DP&D Securities because I believe the
potential rewards are commensurate with the risk. Even if the DP&D Securities
became worthless, I could still maintain my standard of living without
significant hardship to me or my family.

 

By signing this Subscription Agreement, I also accept and agree to be bound by
and to abide by the terms and conditions of the Exchange Agreement as if I had
executed the Exchange Agreement itself.

 

Dated as of this                    day of                                     ,
2006.

 

 

 

 

 

 

Signature

 

 

 

 

 

Name, Please Print

 

 

 

 

 

Residence Address

 

 

 

 

 

City, State and Zip Code

 

 

 

 

 

Area Code and Telephone Number

 

 

 

 

 

Social Security Number

 

 

 

 

 

Number of Sub-Urban Shares Exchanged

 

--------------------------------------------------------------------------------

 

 

 

 

Face Amount of Sub-Urban Convertible

 

Promissory Notes Exchanged

 

 

 

 

 

Number of Sub-Urban Warrants Exchanged

 

 

 

 

 

Number of Sub-Urban Stock Options Exchanged

 

--------------------------------------------------------------------------------

 

EXHIBIT
MATERIAL CONTRACTS
SECTION 2.17

 

LEASE FOR PREMISES:  SUB-URBAN ENTERED INTO A LEASE WITH MAGNUM PROPERTIES FOR
ITS OFFICES ON ON JULY 15, 2004 AND THE LEASE EXPIRES JULY 15, 2006. THE BASE
RENT ON THE LEASE COMMENCED AT $2,500 PER MONTH, AND WITH COST OF LIVING
INCREASES AND OTHER FEES IS APPROXIMATELY $3,000 PER MONTH.

 

Production:  Sub-Urban has entered into production arrangements for the
manufactiure of its apparel. These arrangements are evidenced by purchase
orders. As of April 20, 2006, Sub-Urban has issued purchase orders in excess of
$10,000 to the following vendors:

 

Rippin and Running, Los Angeles, CA

 

$

68,000

 

Trio Group, Montreal, Canada

 

$

73,500

 

 

Marketing:  Sub-Urban has a monthly contract with Caro Marketing, Los Angeles,
CA for a monthly retainer of $5,000, plus expenses. Caro provides public
relations and marketing services. This contract is cancelable with 30 day
notice. Sub-Urban has a promotions conract with MS Communications, NY, NY for
promotions on their New York Hot’97 radio station. The remaining commitment on
this contract is $75,000.

 

Distribution:  Sub-Urban has a month-to-month, cancellable arrangement with JAM,
Gardena, CA for distribution, storage, pick-pack-and ship.

 

--------------------------------------------------------------------------------

 

EXHIBIT

 

EXCEPTION SCHEDULE FOR SUB-URBAN

 

2.2 The stock option grant to Jack Mott has an anti-dilution clause triggered by
an excess of 60,000,000 fully diluted shares.

 

2.4  John Koufis, David Howitt and Kenard Gibbs are slated to be members of the
Board of Directors when the Sub-Urban obtains Directors and Officers liability
insurance, scheduled to be concurrent with the closing date of this Agreement.
Jack Mott is currently a consultant to Sub-Urban and wiull assume the duties of
Chief Financial Officer and Chief Operating Officer, and a member of the Board
of Directors when the Sub-Urban obtains Directors and Officers liability
insurance, scheduled to be concurrent with the closing date of this Agreement.

 

2.6 Absence of Changes:  Since March 31st, 2006, Sub-Urban has entered into a
secured convertible note financing arrangement with Vision Capital in the amount
of $750,000, and in connection with this financing issued i) a warrant for the
purchase of 3,000,000 shares at a price of $0.25 ii) a unit purchase warrant
consisting of a right o purchase 3,000,000 shares of Sub-Urban common stock at
at a price of $0.25 per share by January 18, 2007, plus a 3 year warrant for the
purchase of 1,500,000 shares of common stock at an exercise price of $0.50 per
share. In connection with a prior financing, Sub Urban also issued a warrant for
the purchase of 2,000,000 shares of common stock at an exercise price of $0.25
per share. Estimated sales for the period April 1, 2006 to the effective date of
this agreement are approximately $9,500. Sub-Urban is in leased premises and the
lease expires July 15, 2006. Sub-Urban anticipates it will relocate its offices
to an area within Los Angeles county by July 15, 2006.

 

2.8  Sub-Urban has filed its 2003 Federal and State tax returns, and has filed
extensions for its 2004 and 2005 Federal and sState tax returns. Based on the
audited financial statements received by Sub-Urban in April 2006 for the years
2003, 2004 and 2005, Sub-Urban will file its Federal and State tax returns by
September 15, 2006 and may be required to file an amended Federal and State tax
return for 2003. Sub-Urban has net operating losses for the years 2003, 2004 and
2005 and does not anticipate any material tax liability for these years.

 

4.2 Conduct of business:  Sub-Urban may make commitments for up to an additional
$600,000 of operating capital prior to the closing date of this Agreement. It
may do so under similar financing arrangements as its recent financings
including a convertible secured note, convertible into common stock at $0.25 per
share, and 100% warrant coverage at an exercise price of $0.25 per share, plus a
unit purchase warrant.

 

--------------------------------------------------------------------------------

 

Exhibit
List of Sub-Urban Intellectual Property
Section 2.10

 

 

--------------------------------------------------------------------------------

 

Matter No.
Country

 

Mark

 

Class(es)

 

Goods/Services

 

Serial No.
Filing Date

 

Reg. No.
Reg.
Date

 

Use &
Renewal
Deadline

 

Status

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

T001

United States

 

WHITEBOY

 

25

 

Shirts, hats, and pants

 

78/093,948

11/17/01

 

2,833,040

04/13/04

 

Use Due:

4/13/10

Renewal
Due:

4/13/14

 

Registered.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

T003

United States

 

WHITE
DEVIL

 

25

 

Clothing, namely, shirts, pants, t-shirts, footwear, headwear, baseball caps,
shorts, swimwear, lingerie, sweat shirts, underwear, jackets, dresses, and
skirts

 

76/451,609

09/23/02

 

2,935,357

3/22/05

 

Use Due:

3/22/11

Renewal
Due:

3/22/15

 

Registered.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

T006

United States

 

BLACK
JESUS

 

25

 

Clothing, namely, shirts, pants, T-shirts, footwear, headwear, baseball caps,
shorts, swimwear, lingerie, sweat shirts, underwear, jackets, dresses, and
skirts

 

76/479,408

12/31/02

 

2,900,384

11/02/04

 

Use Due:

11/02/10

Renewal
Due:

11/02/14

 

Registered.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

T007

 

WHITEGIRL

 

25

 

Shirts, hats and pants

 

78/094,289

 

2,754,411

 

Use Due:

 

Registered.

 

--------------------------------------------------------------------------------

 

Matter No.
Country

 

Mark

 

Class(es)

 

Goods/Services

 

Serial No.
Filing Date

 

Reg. No.
Reg.
Date

 

Use &
Renewal
Deadline

 

Status

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

United States

 

 

 

 

 

 

 

11/20/01

 

8/19/03

 

8/19/09

Renewal
Due:
8/19/13

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

T008

United States

 

WHITEBOY
RECORDS

 

9

41

 

Musical sound recordings and audio-visual recordings, namely, compact discs,
tape cassettes, records, CD-ROMs, VHS video tapes, DVD and laser discs

Entertainment services, namely, video tape and motion picture film production,
music publishing services, production of musical audio and video recordings

 

76/507,784

4/21/03

 

3,021,412

11/29/05

 

Use Due:
11/29/11

Renewal
Due:
11/29/15

 

Registered.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

T009

United States

 

WHITEBOY

 

9

 

Musical sound recordings and audio-visual recordings, namely, compact discs,
tape cassettes, records, CD-ROMs, VHS video tapes, DVD, and laser discs;
computer software and programs all being computer games; video game software;
laser discs cartridges, audio and video tapes, audio and video cassettes and
CD-ROMs all bearing video games; video game computer software adapted for use
with television receivers and computers

 

76/507,785

4/21/03

 

 

 

 

 

A Request for the First Extension of Time to File a Statement of Use has been
granted.

Statement of Use and/or Second Request for Extension of Time due by 5/24/06.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

T011

United States

 

WHITEBOY

 

28

 

Snow boards and parts therefor; skateboards and parts therefor; surfboards and
parts therefor; toys, namely, toy vehicles, plush toy dolls and plush toy
animals, toy action figures, board games, water squirting toys, flying disks

 

76/507,783

4/21/03

 

 

 

 

 

A Request for the First Extension of Time to File a Statement of Use has been
granted.

Statement of Use and/or Second

 

--------------------------------------------------------------------------------

 

Matter No.
Country

 

Mark

 

Class(es)

 

Goods/Services

 

Serial No.
Filing Date

 

Reg. No.
Reg.
Date

 

Use &
Renewal
Deadline

 

Status

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Request for Extension of Time due by 5/17/06.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

T013

United States

 

WHITEBOY

 

14

 

Jewelry; belt buckles of precious metals for clothing

 

76/511,641

5/05/03

 

3,059,283

2/14/06

 

Use:
2/14/12

 

Registered.

 

 

 

 

 

 

 

 

 

 

 

 

Renewal:

 

 

 

 

 

 

16

 

Stickers, bumper stickers

 

 

 

 

 

2/14/16

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

18

 

All-purpose sport bags; tote bags; luggage bags; backpacks; shoulder bags

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

25

 

Clothing, namely, shirts, pants, t-shirts, footwear, headwear, baseball caps,
shorts, swimwear, lingerie, sweatshirts, underwear, jackets, dresses, and
skirts; clothing accessories, namely, belts, shoes, and gloves

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

26

 

Ornamental cloth patches; belt buckles not of precious metal for clothing

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

T018

United States

 

ROOSTER
LOGO
DESIGN

[g119531kci001.jpg]

 

25

 

Clothing, namely, shirts, pants, t-shirts, footwear, headwear, baseball caps,
shorts, swimwear, lingerie, sweatshirts, underwear, jackets, dresses, skirts,
belts, shoes, and gloves

 

76/523,979

6/19/03

 

 

 

 

 

Opposition No. 91163875 v. M. Aaron Corp.

Opposition pending at the Trademark Trial and Appeal Board.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

T019

 

ROOSTER

 

28

 

Snow boards and parts therefor; skateboards and

 

76/523,980

 

3,013,607

 

Use:

 

Registered.

 

--------------------------------------------------------------------------------

 

Matter No.
Country

 

Mark

 

Class(es)

 

Goods/Services

 

Serial No.
Filing Date

 

Reg. No.
Reg.
Date

 

Use &
Renewal
Deadline

 

Status

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

United States

 

LOGO
DESIGN

[g119531kci001.jpg]

 

 

 

parts therefor; surf boards and parts therefor; toys, namely, toy vehicles,
plush toy dolls and plush toy animals, toy action figures, board games, water
squirting toys, flying disks, arcade-type electronic video games

 

6/19/03

 

11/8/05

 

11/8/11

Renewal:
11/8/15

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

T020

United States

 

ROOSTER
LOGO
DESIGN

[g119531kci001.jpg]

 

9

 

Musical sound recordings and audio-visual recordings, namely, compact discs,
tape cassettes, records CD-ROMs, VHS video tapes, DVD, and laser discs; computer
software and programs all being computer games; video game software; laser discs
cartridges, audio and video tapes, audio and video cassettes and CD-ROMs all
bearing video games; video game computer software adapted for use with
television receivers and computers

 

76/523,978

6/19/03

 

2,985,855

8/16/05

 

Use:
8/16/11

Renewal: 8/16/15

 

Registered.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

T025

United States

 

PYT

 

25

 

Clothing, namely, shirts, pants, T-shirts, footwear, headwear, baseball caps,
shorts, swimwear, lingerie, sweat shirts, underwear, jackets, dresses, and
skirts; accessories; belts; buckles; jewelry; shoes; patches; stickers, bags,
tote bags, gloves

 

76/559,174

11/10/03

 

 

 

 

 

A Request for the First Extension of Time to File a Statement of Use has been
granted.

Statement of Use and/or Second Request for Extension of Time due by 5/24/06.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

T013AU25

Australia

 

WHITEBOY

 

25

 

Clothing, including shirts, pants, t-shirts, footwear, headwear, baseball caps,
shorts, swimwear, lingerie, sweatshirts, underwear, jackets, dresses, skirts,
and accessories, namely, scarves

 

954626

5/20/03

 

954626

2/23/04

 

Renewal:

5/20/13

 

Registered.

 

--------------------------------------------------------------------------------

 

Matter No.
Country

 

Mark

 

Class(es)

 

Goods/Services

 

Serial No.
Filing Date

 

Reg. No.
Reg.
Date

 

Use &
Renewal
Deadline

 

Status

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

T013CA

Canada

 

WHITEBOY

 

25

 

Clothing, including shirts, pants, t-shirts, footwear, namely, socks, shoes;
headwear, namely, hats, baseball caps; shorts, swimwear, lingerie, sweatshirts,
underwear, jackets, dresses, skirts, and accessories, namely, scarves; and
ornamental cloth patches

 

1182379

06/23/03

 

 

 

 

 

Pending.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

T013CTM

European Community (CTM)

 

WHITEBOY

 

25

 

Clothing; shirts, pants,
t-shirts, footwear, headwear, baseball caps, shorts, swimwear, lingerie, sweat
shirts, underwear, jackets, dresses, skirts and accessories

 

3155181

5/03/03

 

3155181

2/22/05

 

Renewal:
5/3/13

 

Registered.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

T013JP25

Japan

 

WHITEBOY

 

25

 

Clothing; accessories; belts; buckles; jewelry; shoes; patches; stickers, bags,
tote bags, gloves

 

2003-
047829

6/10/03

 

4750076

2/20/04

 

2/20/14

 

Registered.

 

--------------------------------------------------------------------------------