ex102.htm


    
      

      

    

    EXHIBIT
      10.2

    


     

    ASSET
      PURCHASE AND SALE AGREEMENT

    


    THIS
      ASSET PURCHASE AND SALE AGREEMENT (this “Agreement”) is made and entered
      into as of September 10, 2007, by and among Universal Fog, Inc., a corporation
      organized and existing under the laws of Delaware (“Seller”), and
      Universal Fog Systems, Inc., an Arizona corporation
      (“Buyer”). Capitalized terms used and not otherwise
      defined herein shall have the definitions assigned thereto in Section 10
      below.

    


    R
      E C I T A L S

    


    WHEREAS,
      Buyer desires to acquire certain assets and business operations owned by Seller,
      and Seller is willing to sell such assets and business operations to Buyer,
      on
      the terms and conditions set forth in this Agreement.

    


    A
      G R E E M E N T

    


    NOW,
      THEREFORE, the parties, for good and valuable consideration, the receipt and
      sufficiency of which is hereby acknowledged, agree as follows:

    


    
      	
              1.  

            	
              TRANSFERRED
                LIABILITIES; TRANSFERRED ASSETS; PURCHASE
                PRICE.

            


    

    


    
      	
              1.1.  

            	
              Transferred
                Liabilities and Obligations. The business operations conducted by
                Buyer are referred to herein as the “Business,” and the principal
                location at which the Business is conducted at 1808 South 1st Avenue,
                Phoenix, Arizona 85003. On the First Phase Closing Date (as hereinafter
                defined), following the execution of a certain Share Purchase Agreement
                executed by the Parties, and following the execution of this Agreement,
                Buyer agrees to assume, and Seller agrees to convey, transfer and
                deliver
                to Buyer, all of the liabilities related to the Business or used
                directly
                in connection with the Business (the “Transferred Liabilities”).
                The Transferred Liabilities include, but are not limited to, the
                items
                described on Schedule 2 attached hereto, including the Assumed
                Contracts, if any.

            


    

    


    
      	
              1.2.  

            	
              Transferred
                Assets. Within ninety (90) days of the execution of this Agreement,
                and upon the execution of certain Share Exchange Agreements between
                the
                Seller and a third party operating company (the “Second Phase Closing” and
                the “Second Phase Closing Date”), Buyer agrees to acquire, and Seller
                agrees to convey, transfer and deliver to Buyer, all of the assets
                related
                to the Business, or used directly in connection with the Business,
                including cash, accounts receivable and accounts payable (the
                “Transferred Assets”). The Transferred Assets include, but are not
                limited to, the items described on Schedule 1 attached
                hereto.

            


    

    


    
      	
              1.3  
                

            	
              Purchase
                Price. In consideration for the transfer of the Transferred Assets,
                Buyer agrees to assume all liabilities of the Business, both known
                and
                unknown (the “Purchase
                Price”).

            


    

    


    
      	
              2.  

            	
              CLOSING.

            


    

    


    
      	
              2.1.  

            	
              Closing
                and Possession.

            


    

    


    
      	
              2.1.1.  

            	
              Closing
                Dates. Subject to the satisfaction of the conditions set forth herein,
                the first phase of the transaction which is the subject of this Agreement
                shall be closed on September __, 2007 (the “First Phase Closing”
                and/or “First Phase Closing Date”) at such time and place as the
                parties shall agree in good faith. Within ninety (90) days following
                the
                First Phase Closing Date, the Second Phase Closing of the transaction
                shall be closed at such time and place as the parties shall agree
                in good
                faith.

            


    

    


    
      	
              2.1.2.  

            	
              Possession
                Dates. Actual possession by Buyer, and transfer of title and risk
                of
                loss of the Transferred Liabilities and Buyer’s assumption of the Assumed
                Contracts (if any), shall be deemed to occur effective as of 12:01
                a.m. on
                the first day after the First Phase Closing Date, unless otherwise
                agreed
                by the parties in writing (the “First Phase Possession Date”). The
                actual possession by Buyer, and transfer of title and risk of loss
                of the
                Transferred Assets shall be deemed to occur effective as of the Second
                Phase Closing Date and the execution of the Share Exchange Agreement
                between the Seller and a third party operating company (the “Second Phase
                Possession Date.”

            


    

    


    
      	
              2.2.  

            	
              Deliveries
                by Seller.

            


    

    


    
      	
              2.2.1.  

            	
              At
                the First Phase Closing, Seller shall deliver the
                following:

            


    

    


    
      	
              2.2.1.1.  

            	
              A
                Bill of Sale and Assignment in the form attached hereto as Exhibit
                A (the “First Phase Bill of Sale”), executed by Seller,
                transferring all of the Transferred Liabilities of the Company to
                Buyer.

            


    

    


    
      	
              2.2.1.2.  

            	
              All
                documentation required, if any, to permit Buyer to continue to use
                and
                occupy the Business’ location, including a sublease if necessary, in form
                and substance acceptable to Buyer, executed by the landlord of the
                Business’ location.

            


    

     

    
      
        
        

      

      
        -
          1
          -

        
          

        

      

      
        
        

      

    

    
 

    
      	
              2.2.1.3.  

            	
              Such
                other documents, including certificates and third-party consents
                or
                releases, as may be required hereunder or as reasonably requested
                by Buyer
                to complete the transactions contemplated in this
                Agreement.

            


    

    


    
      	
              2.2.2.  

            	
              At
                the Second Phase Closing, Seller shall deliver the
                following:

            


    

    


    
      	
              2.2.2.1.  

            	
              A
                Bill of Sale and Assignment in the form attached hereto as Exhibit
                B (the “Second Phase Bill of Sale”), executed by Seller,
                transferring all of the Transferred Assets of the Company to
                Buyer.

            


    

    


    
      	
              2.3.  

            	
              Deliveries
                by Buyer. At the First Phase Closing, Buyer will deliver the
                following:

            


    

    


    
      	
              2.3.1.  

            	
              The
                Purchase Price.

            


    

    


    
      	
              2.3.2.  

            	
              Such
                other documents, including certificates, as may be required hereunder
                or
                as reasonably requested by Buyer to complete the transactions contemplated
                in this Agreement.

            


    

    


    
      	
              3.  

            	
              SELLERS’
                REPRESENTATIONS AND WARRANTIES. Seller represents and warrants to
                Buyer that the following are true, correct and complete as of the
                date of
                this Agreement:

            


    

    


    
      	
              3.1.  

            	
              Authority.  Seller
                has all requisite right, power and authority to: (i) own its assets
                and to
                conduct the business operations of the Business as now being conducted;
                (ii) execute and deliver this Agreement and its related documents
                and
                perform its obligations hereunder and thereunder, and (iii) consummate
                the
                transactions contemplated in this Agreement. There are no agreements,
                contracts or commitments to which either of the Seller or the Company
                is a
                party that would prohibit or restrict the transactions contemplated
                under
                this Agreement. No consent, approval, order, or other authorization
                of any
                governmental or regulatory authority is required with respect to
                Seller’s
                execution and deliver of this Agreement or any related document,
                or
                consummation of the transactions contemplated herein or therein.
                When
                executed and delivered by Seller, this Agreement constitutes the
                valid and
                binding obligation of Seller enforceable in accordance with its
                terms.

            


    

    


    
      	
              3.2.  

            	
              Ownership
                of Transferred Assets; Condition of Tangible Transferred Assets. At
                the First Phase Closing, Buyer shall acquire all of Seller’s right, title
                and interest in the Transferred Liabilities. At the Second Phase
                Closing,
                Buyer shall acquire all of Seller’s right, title and interest in the
                Transferred Assets. The Transferred Assets are in good condition
                and
                repair, subject to ordinary wear and tear, and are adequate and fit
                for
                the uses for which they are intended or being
                used.

            


    

    


    
      	
              3.3.  

            	
              Transaction
                Not a Breach. The execution and delivery of this Agreement and its
                related documents, the performance by Seller hereunder, and the
                consummation of the transactions described herein, will not conflict
                with
                or violate (i) any law, ordinance, regulation, order, award, judgment,
                injunction or decree applicable to Seller or to the Transferred Assets
                and
                Liabilities, or (ii) conflict with or result in a breach of or constitute
                a default under any of the terms, conditions or provisions of the
                articles
                of incorporation, bylaws, or other instruments of formation or
                organization of Seller.

            


    

    


    
      	
              3.4.  

            	
              Listings
                and Other Data. All receivable listings, customer lists and all other
                information, reports and data made available or provided to Buyer
                by
                Seller are true, correct and accurate in all material respects as
                of the
                date provided or made available, as of the date of this Agreement.
                Seller
                has no present knowledge of any intent of any current customer or
                vendor
                to modify or terminate any of its outstanding orders or contracts
                and
                Seller has received no notice to such
                effect.

            


    

    


    
      	
              3.5.  

            	
              Litigation;
                Compliance with Laws; Licenses and Permits. There is no Proceeding
                pending or, to the knowledge of Seller, threatened against or involving
                Seller, the Business, the Transferred Assets or the Transferred
                Liabilities, or the propriety of this Agreement or any of the transactions
                contemplated hereby, at law or in equity, or before or by any court,
                arbitrator or governmental authority, and the Business are not being
                operated under or subject to any order, final non-appealable judgment,
                decree, license or injunction of any court, arbitrator or governmental
                authority.

            


    

    


    
      	
              3.6.  

            	
              Absence
                of Adverse Changes. There has been no material adverse change, or any
                event, condition or occurrence that is reasonably likely to result
                in a
                material adverse change, to the condition of the Transferred Liabilities,
                the Transferred Assets or the business operations of the
                Business.

            


    

    


    
      	
              3.7.  

            	
              Contracts.
                Seller has made available or been willing to provide to Buyer true
                and
                complete copies of all Assumed Contracts, including without limitation
                all
                current customer contracts relating to the Business. There are no
                material
                agreements relating to the Business, whether verbal or written, that
                have
                not been disclosed to Buyer. All of the Assumed Contracts are in
                full
                force and effect and are valid and enforceable according to their
                terms,
                and there are no material breaches or defaults thereunder, and no
                condition exists that would cause, whether by passage of time or
                otherwise, a breach or default thereunder. Seller has not entered
                into any
                agreement or understanding, whether written or oral, that waives
                any of
                its respective rights under any of the Assumed
                Contracts.

            


    

     

    
      
        
        

      

      
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          2
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              3.8.  

            	
              Environmental
                Issues. In connection with the Business, Seller has not transported,
                stored, maintained, used, manufactured or released any hazardous
                material
                or other environmentally sensitive material or substance in violation
                of
                any applicable legal or regulatory
                requirement.

            


    

    


    
      	
              3.9.  

            	
              Solvency.
                Neither Seller nor the Business have been the subject of any bankruptcy
                proceedings (whether voluntary or involuntary), made an assignment
                for the
                benefit of creditors, been adjudicated bankrupt or insolvent, petitioned
                for or been assigned any receiver or trustee relating to the Business
                or
                any of the Transferred Liabilities or Transferred Assets, commenced
                any
                reorganization or restructuring of debt, or otherwise failed to fulfill
                its payment obligations in the ordinary course. None of the above
                has been
                commenced or threatened against Seller or the
                Business.

            


    

    


    
      	
              3.10.  

            	
              Disclosure.
                No representation or warranty by Seller and no document furnished
                by
                Seller pursuant to this Agreement or otherwise in connection herewith
                contains or will contain any untrue statement of a material fact
                or omits
                or will omit to state any material fact necessary in order to make
                the
                statements contained therein, in light of the circumstances under
                which
                made, not misleading.

            


    

    


    
      	
              4.  

            	
              BUYER’S
                REPRESENTATIONS AND WARRANTIES. Buyer represents and warrants to
                Seller that the following are true, correct and complete as of the
                date of
                this Agreement:

            


    

    


    
      	
              4.1.  

            	
              Authority.
                Buyer has all requisite right, power and authority to: (i) execute
                and
                deliver this Agreement and its related documents and perform his
                obligations hereunder and thereunder, and (ii) consummate the transactions
                contemplated in this Agreement. There are no agreements, contracts
                or
                commitments to which Buyer is a party that would prohibit or restrict
                the
                transactions contemplated under this Agreement. No consent, approval,
                order, or other authorization of any governmental or regulatory authority
                is required with respect to Buyer’s execution and deliver of this
                Agreement or any related document, or consummation of the transactions
                contemplated herein or therein. When executed and delivered by Buyer,
                this
                Agreement constitutes the valid and binding obligation of Buyer
                enforceable in accordance with its
                terms.

            


    

    


    
      	
              4.2.  

            	
              Transaction
                Not a Breach.  The execution and delivery of this Agreement
                and its related documents, the performance by Buyer hereunder, and
                the
                consummation of the transactions described herein, will not conflict
                with
                or violate (i) any law, ordinance, regulation, order, award, judgment,
                injunction or decree applicable to Buyer, or (ii) conflict with or
                result
                in a material breach of any contract, agreement, or other instrument,
                obligation or understanding of any nature to which Buyer is a party
                or by
                which Buyer is bound or affected.

            


    

    


    
      	
              4.3.  

            	
              Solvency.
                Buyer has not been the subject of any bankruptcy proceedings (whether
                voluntary or involuntary), made an assignment for the benefit of
                creditors, been adjudicated bankrupt or insolvent, petitioned for
                or been
                assigned any receiver or trustee relating to his assets, commenced
                any
                reorganization or restructuring of debt, or otherwise failed to fulfill
                his payment obligations in the ordinary course. None of the above
                has been
                commenced or threatened against
                Buyer.

            


    

    


    
      	
              5.  

            	
              MANAGEMENT
                AND CONTROL OF ASSETS.

            


    

    


    
      	
              5.1.  

            	
              Management.  During
                the ninety (90) day interim period between the First Phase Closing
                and the
                Second Phase Closing, Buyer shall assume all management and control
                of the
                assets and operations of the Business.  Buyer shall have
                supervisory control over the management of the Business, and may
                delegate
                duties according to its discretion. Additionally Buyer shall perform
                all
                management functions related to and on behalf of the Business, including
                without limitation the power to enter into, make, sign, seal, deliver
                and
                perform all agreements, contracts, documents, instruments and other
                undertakings and to engage in all activities and transactions as
                may be
                necessary or desirable in order to carry out the Business. Buyer
                shall be
                responsible for maintaining all financial and accounting records
                of the
                Business. Any and all revenue generated or cost incurred by Business
                shall
                be to the benefit or obligation of
                Buyer.

            


    

    


    
      	
              6.  

            	
              ADDITIONAL
                COVENANTS.

            


    

    


    
      	
              6.1.  

            	
              Expenses.
                Unless expressly stated otherwise herein, each of Buyer and Seller
                will
                bear their own respective costs and expenses incurred in connection
                with
                the preparation and execution of this Agreement and its related documents,
                and the consummation of the transactions contemplated herein, including
                without limitation all legal fees and expenses, and fees arising
                from
                accountants, tax and financial
                advisors.

            


    

    


    
      	
              6.2.  

            	
              Confidentiality.

            


    

    


    
      	
              6.2.1.  

            	
              Each
                party agrees that it will (i) not disclose the other party’s Confidential
                Information to any third party; and (ii) protect all Confidential
                Information of the other party from unauthorized use, access, or
                disclosure in the same manner as it protects its own Confidential
                Information of a similar nature, and in no event with less than reasonable
                care. Upon the disclosing party’s written request, the receiving party
                will promptly return any Confidential Information identified in the
                request to the disclosing party. “Confidential Information” shall
                mean any information that is proprietary or non-public regarding
                any
                party, including without limitation, customer and vendor lists, business
                plans, network design and structure, and financial information.
                Confidential Information shall include the terms of this
                Agreement.

            


    

    


    
      	
              6.2.2.  

            	
              The
                foregoing restrictions will not apply to information that: (i) is
                or
                becomes generally known or available by publication, commercial use
                or
                otherwise through no fault of the receiving party or of any third
                party
                with a duty to keep such information confidential; (ii) is known
                to the
                receiving party at the time of disclosure without violation of any
                confidentiality restriction and without any restriction on the receiving
                party’s further use or disclosure; or (iii) is independently developed
                by
                the receiving party.

            


    

     

     

    
      
        
        

      

      
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          3
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              6.3.  

            	
              Publicity;
                Press Releases. The parties agree to consult with each other in good
                faith concerning any public reports, statement, press releases or
                other
                publicity (“Publicity”) regarding this Agreement or the
                transactions hereunder, but in no case will either party disclose
                in
                connection with any such Publicity any financial aspect of the Agreement
                or the transactions hereunder (including without limitation the Purchase
                Price) without the other party’s prior written consent; provided,
                however that any party shall be entitled to give notices or provide
                information regarding this Agreement or the transactions to governmental
                or regulatory authorities, creditors, legal and financial advisors,
                and
                others as legally required; and further provided, that nothing in
                this section shall prohibit Buyer from issuing a press release or
                other
                Publicity indicating new ownership of the Company (excepting financial
                information, as set forth above).

            


    

    


    
      	
              6.4.  

            	
              Business
                Name. The parties agree to work together in good faith following
                the
                First Phase Closing to obtain the transfer of the business name “Universal
                Fog, Inc.” to Buyer, including without limitation to execute and file any
                documents required by applicable rules and regulations of the relevant
                State and Federal agencies. Pending such actual transfer, Seller
                hereby
                irrevocably grants to Buyer an exclusive license in all of Seller’s rights
                to use the business name “Universal Fog,
                Inc.”

            


    

    


    
      	
              7.  

            	
              CONDITIONS
                PRECEDENT.

            


    

    


    
      	
              7.1.  

            	
              Conditions
                Precedent to Buyer’s Obligations. The obligations of Buyer to
                consummate the transactions contemplated hereunder and to proceed
                with the
                First Phase Closing and Second Phase Closing are subject to the
                fulfillment of the following conditions, any of which may be waived
                in
                whole or in part by Buyer in
                writing.

            


    

    


    
      	
              7.1.1.  

            	
              Accuracy
                of Representations and Warranties. The representations and warranties
                of Seller contained in Section 3 of this Agreement shall be true,
                complete
                and accurate in all material respects as of the First Phase Closing
                Date.

            


    

    


    
      	
              7.1.2.  

            	
              Compliance
                with Agreement. Seller shall have complied with all obligations,
                agreements, commitments and covenants, and shall have fulfilled all
                conditions, required by this Agreement and its related documents
                to be
                performed or complied with on or prior to the First Phase Closing
                Date.

            


    

    


    
      	
              7.1.3.  

            	
              Authority;
                Third-Party Consents. All actions necessary to authorize the
                execution, delivery and performance hereunder by Seller shall have
                been
                undertaken and completed.  Any filings, registrations, notices,
                consents, releases and approvals required by Seller from any governmental
                entity or other third party for the performance of Seller’s obligations
                hereunder shall have been obtained.  To the extent that any of
                such consents or approvals for any Assumed Contract have not been
                obtained
                prior to the First Phase Closing, and Buyer elects to close the
                transactions hereunder prior to receiving any such consent or approval,
                Seller and Buyer each agree to exercise best efforts to obtain such
                consent or approval as soon as reasonably feasible following the
                First
                Phase Closing, and Seller agrees in the meantime to facilitate Buyer’s
                receipt of the benefit of such Assumed Contracts and Buyer’s payment of
                any amounts due under the applicable Assumed Contracts until such
                consent
                or approval has been obtained.

            


    

    


    
      	
              7.1.4.  

            	
              Reasonable
                Satisfaction. The form and substance of all certificates, notices,
                actions and documents required to consummate the transactions contemplated
                hereunder shall have been reasonably satisfactory to Buyer and its
                counsel.

            


    

    


    
      	
              7.2.  

            	
              Conditions
                Precedent to Seller’s Obligations. The obligations of Seller to
                consummate the transactions contemplated hereunder and to proceed
                with the
                First Phase Closing are subject to the fulfillment of the following
                conditions, any of which may be waived in whole or in part by Seller
                in
                writing.

            


    

    


    
      	
              7.2.1.  

            	
              Accuracy
                of Representations and Warranties. The representations and warranties
                of Buyer contained in Section 4 of this Agreement shall be true,
                complete
                and accurate in all material respects as of the First Phase Closing
                Date.

            


    

    


    
      	
              7.2.2.  

            	
              Compliance
                with Agreement. Buyer shall have complied with all obligations,
                agreements, commitments and covenants, and shall have fulfilled all
                conditions, required by this Agreement and its related documents
                to be
                performed or complied with on or prior to the First Phase Closing
                Date.

            


    

    


    
      	
              7.2.3.  

            	
              Reasonable
                Satisfaction. The form and substance of all certificates, notices,
                actions and documents required to consummate the transactions contemplated
                hereunder shall have been reasonably satisfactory to Seller and its
                counsel.

            


    

    


    
      	
              8.  

            	
              INDEMNIFICATION.

            


    

    


    
      	
              8.1.  

            	
              Indemnification
                by Seller.  Seller shall defend, indemnify and hold harmless
                Buyer and each of Buyer’s officers, directors, shareholders, employees,
                counsel, agents, and their respective successors and assigns
                (collectively, the “Buyer Indemnitees”) from and against, and shall
                reimburse the Buyer Indemnitees for, each and every Loss incurred
                by any
                Buyer Indemnitee, directly or indirectly, arising out of or in connection
                with: (i) any material inaccuracy in any representation or warranty
                of
                Seller hereunder; (ii) any material breach or nonfulfillment of any
                covenant, agreement or other obligation of Seller under this Agreement
                or
                any related documents; (iii) any product liability or similar claim
                relating to business operations of the Business or sales by Seller
                prior
                to the Possession Date; or (iv) any debt, liability, or other obligation
                of Seller arising (or relating to the period) prior to the Possession
                Date, except for obligations (if any) assumed by Buyer hereunder
                or
                otherwise expressly accepted by Buyer in writing
                hereafter.

            


    

     

    
      
        
        

      

      
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          4
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              8.2.  

            	
              Indemnification
                by Buyer.  Buyer shall defend, indemnify and hold harmless
                Seller and each of Seller’s officers, directors, shareholders, employees,
                counsel, agents, and their respective successors and assigns
                (collectively, the “Seller Indemnitees”) from and against, and
                shall reimburse the Seller Indemnitees for, each and every Loss incurred
                by any Seller Indemnitee, directly or indirectly, arising out of
                or in
                connection with: (i) any material inaccuracy in any representation
                or
                warranty of Buyer hereunder; (ii) any material breach or nonfulfillment
                of
                any covenant, agreement or other obligation of Buyer under this Agreement
                or any related documents; (iii) any product liability or similar
                claim
                relating to business operations of the Business or sales by Buyer
                after
                the Possession Date; or (iv) any debt, liability, or other obligation
                of
                Seller arising (or relating to the period) after the Possession Date
                relating to obligations assumed by Buyer or expressly accepted by
                Buyer in
                writing hereafter.

            


    

    


    
      	
              8.3.  

            	
              Indemnification
                Procedure. If any Proceeding shall be brought or asserted against a
                party entitled to indemnification (or any successor thereto) pursuant
                to
                Sections 7.1 or 7.2 (each, an “Indemnitee”) in respect of which
                indemnity may be sought under this Section 7 from an indemnifying
                party or
                any successor thereto (each, and “Indemnitor”), the Indemnitee
                shall give prompt written notice of such Proceeding to the Indemnitor.
                The
                Indemnitor shall thereupon assume the defense thereof, including
                the
                engagement of legal counsel reasonably satisfactory to the Indemnitee
                and
                the payment of all reasonable expenses associated therewith;
                provided, that any delay or failure to provide such notice to the
                Indemnitor shall relieve the Indemnitor of its indemnification obligations
                only to the extent, if at all, that it has been prejudiced by reason
                of
                such delay or failure. The Indemnitee shall, reasonably and in good
                faith,
                assist and cooperate in the defense thereof. Notwithstanding anything
                herein to the contrary, the Indemnitor shall not, without the Indemnitee’s
                prior written consent, settle or compromise any Proceeding or consent
                to
                the entry of judgment with respect
                thereto.

            


    

    


    
      	
              9.  

            	
              MISCELLANEOUS.

            


    

    


    
      	
              9.1.  

            	
              Notices.
                Any notices from one party to another shall be deemed sufficiently
                given
                upon delivery (with the return receipt, the delivery receipt, or
                the
                affidavit of messenger), refusal by addressee or notice to the recipient
                from the Post Office that such notice is undeliverable, if such notice
                has
                been mailed by United States registered or certified mail, postage
                prepaid, or delivered by overnight courier addressed
                to:

            


    

    


    If
      to
      Seller:

    


    Universal
      Fog, Inc.

    1808
      South 1st
      Avenue

    Phoenix,
      Arizona  85003

    


    If
      to
      Buyer:

    


    Universal
      Fog Systems, Inc.

    1808
      South 1st
      Avenue

    Phoenix,
      Arizona  85003

    Attn:
      Thomas Bontems

    


    or
      at
      such other address or addresses as such party may from time to time specify
      by
      notice in writing to the other, given in the manner provided in this
      Section.

    


    
      	
              9.2.  

            	
              Waiver;
                Severability. No delay or failure on the part of any party hereto in
                exercising any right, power or privilege under any of this Agreement
                shall
                impair any such right, power or privilege or be construed as a waiver
                of
                any default or any acquiescence therein. The unenforceability or
                invalidity of any provision of this Agreement shall not affect the
                enforceability or validity of any other
                provision.

            


    

    


    
      	
              9.3.  

            	
              Benefit
                and Assignment. This Agreement and all of the provisions hereof shall
                be binding upon and inure to the benefit of the parties hereto and
                their
                respective heirs, beneficiaries, successors and assigns. Except as
                expressly stated herein, this Agreement shall not confer any rights
                or
                remedies on any third party.

            


    

    


    
      	
              9.4.  

            	
              Entire
                Agreement; Amendment. The schedules and exhibits attached to this
                Agreement are incorporated herein by reference. This Agreement sets
                forth
                the entire understanding of the parties with respect to the subject
                matter
                hereto, supersedes all prior oral or written agreements, instruments
                and
                understandings with respect to such matters, and may be modified
                only by
                instruments signed by the parties. This Agreement may not be amended
                or
                modified except by written agreement of the parties
                hereto.

            


    

    


    
      	
              9.5.  

            	
              Survival.
                All of the covenants of the parties shall survive the execution of
                this
                Agreement, the First Phase Closing and the Second Phase Closing,
                including
                without limitation the indemnification obligations of the parties.
                All of
                the representations and warranties of the parties shall survive the
                execution of this Agreement, the First Phase Closing and the Second
                Phase
                Closing, regardless of the parties’ respective due diligence
                investigations and even if the other party knows or should have known
                of
                any misrepresentation or breach of any warranty at the time of the
                First
                Phase Closing, for a period of one year following the First Phase
                Closing.

            


    

     

    
      
        
        

      

      
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              9.6.  

            	
              Further
                Assurances.  Prior to, on and after each of the First Phase
                Closing and Second Phase Closing, each party shall execute, deliver
                and/or
                furnish to the other party, upon reasonable request, such further
                information or documents, and do such other acts and things, for
                the
                purpose of fulfilling the transactions contemplated
                hereunder.

            


    

    


    
      	
              9.7.  

            	
              Attorneys’
                Fees. In the event that any party hereunder brings a Proceeding to
                enforce this Agreement, the party that prevails in such Proceeding
                shall
                be entitled to recover, in addition to all other amounts and relief
                that
                may be granted, its reasonable costs and attorneys’ fees incurred in
                connection with such Proceeding.

            


    

    


    
      	
              9.8.  

            	
              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.

            


    

    


    
      	
              9.9.  

            	
              Governing
                Law. This Agreement, the rights and obligations of the parties hereto,
                and any claims or disputes relating hereto, shall be construed and
                governed in accordance with the laws of the State of Arizona, excluding
                the choice of law rules thereof.

            


    

    


    
      	
              9.10.  

            	
              Headings;
                Interpretation. The subject headings of Sections of this Agreement are
                included for purposes of convenience only and shall not affect the
                construction or interpretation of any of its provisions. This Agreement
                shall be interpreted as if all the parties had drafted
                it.

            


    

    


    
      	
              10.  

            	
              DEFINITIONS.
                In addition to any other definitions contained in this Agreement,
                the
                following words, terms and phrases shall have the following meanings
                when
                used in this Agreement.

            


    

    


    “Agreement”
      means this Asset Purchase and Sale Agreement.

    


    “Assumed
      Contracts” means the certain contracts, if any, relating to the Business that
      are to be assumed by Buyer and are listed on Schedule 2 attached to the
      Agreement.

    


    “Bill
      of
      Sale” has the meaning ascribed thereto in Section 2.2.2.

    


    “Business”
      has the meaning ascribed thereto in Section 1.1.

    


    “Buyer”
      means Universal Fog Systems, Inc., an Arizona corporation.

    


    “Buyer
      Indemnitees” has the meaning ascribed thereto in Section 7.1.

    


    “Confidential
      Information” has the meaning ascribed thereto in Section 5.2.1.

    


    “Encumbrance”
      means any encumbrance, security interest, mortgage, lien, pledge, claim, lease,
      right of first refusal, option, restrictive easement, charge or other
      restriction or third party rights.

    


    First
      Phase Closing has the meaning described thereto in Section 2.1.1

    


    “Indemnitee”
      has the meaning ascribed thereto in Section 7.3.

    


    “Indemnitor”
      has the meaning ascribed thereto in Section 7.3.

    


    “Knowledge”
      or “knowledge” (including the terms “knowing” and “knowingly”) will be deemed to
      be present with any party when the matter in question was brought to the
      attention of, or if due diligence had been exercised, would have been brought
      to
      the attention of the party, or any of its responsible employees.

    


    “Loss”
      means any loss, damage, injury, harm, detriment, decline in value, liability,
      claim, demand, cost of any Proceeding, settlement, judgment, award, fine,
      penalty, tax, fee, charge, cost or expense (including, without limitation,
      costs
      associated with avoiding any of the foregoing), and the fees, disbursements
      and
      expenses of attorneys, accountants and other professional
      advisors).

    


    
      
        
        

      

      
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          6
          -

        
          

        

      

      
        
        

      

    

     

     

    “Proceeding”
      means any action, suit, litigation, arbitration, lawsuit, claim, proceeding
      (including any civil, criminal, administrative, investigative or appellate
      proceeding, and any informal proceeding), prosecution, contest, hearing,
      inquiry, audit, examination, investigation, challenge, controversy or dispute
      commenced, brought or conducted or through any governmental authority, including
      the courts, or any arbitrator.

    


    “Promissory
      Note” and “Promissory Notes” have the meaning ascribed thereto in Section
      1.3.3.

    


    “Publicity”
      has the meaning ascribed thereto in Section 5.3.

    


    “Purchase
      Price” has the meaning ascribed thereto in Section 1.3.

    


    “Second
      Phase Closing” has the meaning ascribed thereto in Section 1.2.

    


    “Security
      Agreement” has the meaning ascribed thereto in Section 1.3.3.

    


    “Seller
      Indemnitees” has the meaning ascribed thereto in Section 7.2.

    


    “Seller”
      means Universal Fog, Inc., a corporation organized and existing under the laws
      of Delaware.

    


    “Taxes”
      means all taxes, charges, fees, levies, duties or other similar assessments,
      reassessments or liabilities.

     

    


    “Tax
      Returns” mean any report, return or statement required to be supplied to a
      taxing authority in connection with Taxes.

    


    “Transferred
      Assets” has the meaning ascribed thereto in Section 1.1.

    


     

    [Remainder
      of page intentionally left blank; signature page to follow.]

     

    
 

    
      
        
        

      

      
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    SIGNATURES

    


    


    IN
      WITNESS WHEREOF, the parties have duly executed and delivered this Asset
      Purchase and Sale Agreement effective as of the date first above
      written.

    


    


    


    SELLER:                                                                                
BUYER:

    


    Universal
      Fog,
      Inc.                                                                           
Universal Fog Systems, Inc.

    


    


    
/s/ Tom
      Bontems                                                         
/s/ Tom Bontems

    Name:   Tom
      Bontems                                                                        Tom
      Bontems, Member

    Title:      Chief
      Executive Officer

    


     

    
 

     

    
 

    
      
        
        

      

      
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          8
          -

        
          

        

      

      
        
        

      

    


    


    


     

    LIST
      OF SCHEDULES AND EXHIBITS

     

     

    
 

    Schedule
      1    --           List
      of Transferred Assets

    Schedule
      2    --           List
      of Transferred Liabilities and Assumed Contracts

    Exhibit
      A      
--           First Phase
      Bill of Sale

    Exhibit
      B       
--           Second Phase
      Bill of Sale

    


    


     

    
 


    
      
        
        

      

      
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    Schedule
      1

    


    List
      of Transferred Assets

    


    


    The
      “Transferred Assets” shall constitute the following:

    


    All
      assets used directly in the business operations of the Business, including
      without limitation as set forth on the attached equipment list entitled
“Universal Fog, Inc.: Equipment List,” and all other equipment, fixtures,
      property, furniture and other personal property, goodwill, inventory,
      trademarks, trade names, lease and leasehold improvements, telephone numbers,
      customer lists, transferable permits and licenses, signs, training materials
      and
      other proprietary information, and other intangible assets, including cash,
      accounts receivable, and accounts payable.

    


     

    
 

    



    
      
                  

        
        

      

      
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    Schedule
      2

    


    List
      of Assumed Liabilities and Contracts

    


    The
      Assumed Liabilities and Contracts shall constitute the following:

    


    


    


    [insert
      description here]

     

     

     

     


    
      
        
        

        
        

      

      
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          -

        
          

        

      

      
        
        

      

    


    EXHIBIT
      A

    


    First
      Phase Bill of Sale

    


    


    FIRST
      PHASEBILL OF SALE AND ASSIGNMENT

    


    This
      FIRST PHASE BILL OF SALE AND ASSIGNMENT is executed as of September __, 2007,
      by
      Universal Fog, Inc., a corporation organized and existing under the laws of
      Delaware (“Assignor”) in favor of Universal Fog Systems, Inc., an Arizona
      corporation (“Assignee”), pursuant to that certain Asset Purchase and
      Sale Agreement of even date herewith between Assignor and Assignee (the
“Asset Purchase Agreement”). Capitalized terms used herein but not
      otherwise defined herein shall have the meanings ascribed thereto in the Asset
      Purchase Agreement.

    


    Assignor
      hereby assigns, grants, bargains, sells, conveys, transfers and sets over unto
      Assignee all of the Transferred Liabilities, including, without limitation,
      the
      following: (i) [insert description of liabilities here].

    


    Except
      as
      otherwise expressly set forth herein and in the Asset Purchase Agreement,
      Assignor makes no representation or warranty to Assignee regarding the
      Transferred Liabilities, express or implied.

    


    IN
      WITNESS WHEREOF, Assignor has executed this First Phase Bill of Sale and
      Assignment as of the date first set forth above.

     

    
 

    Universal
      Fog,
      Inc.

    
 

    Name:
      _________________________________

    Title:
      __________________________________

    


     

    
 


    
      
        
        

      

      
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    EXHIBIT
      B

    


    Second
      Phase Bill of Sale

    


    


    SECOND
      PHASE BILL OF SALE AND ASSIGNMENT

    


    This
      SECOND PHASE BILL OF SALE AND ASSIGNMENT is executed as of _____________ __,
      2007, by Universal Fog, Inc., a corporation organized and existing under the
      laws of Delaware (“Assignor”) in favor of Universal Fog Systems, Inc., an
      Arizona corporation (“Assignee”), pursuant to that certain Asset Purchase
      and Sale Agreement of even date herewith between Assignor and Assignee (the
      “Asset Purchase Agreement”).  Capitalized terms used herein but
      not otherwise defined herein shall have the meanings ascribed thereto in the
      Asset Purchase Agreement.

    


    Assignor
      hereby assigns, grants, bargains, sells, conveys, transfers and sets over unto
      Assignee all of the Transferred Assets, including, without limitation, the
      following: (i) all inventory and equipment located at or used in the Business,
      (ii) all rights, title and interests of Seller under the Assumed Contracts,
      if
      any; (iii) all other personal property owned or leased by Seller and used in
      the
      Business; (iv) all goodwill and other intangible assets of Seller and Business,
      but not including cash or accounts receivable; and (v) all books, records,
      instruction manuals, logs, customer and vendor lists, and other documentation
      except the accounting records relating to any of the above.

    


    Assignor
      hereby warrants to Assignee and its successors and assigns that good any
      marketable title to the Transferred Assets is hereby conveyed to Assignee,
      free
      and clear of all Encumbrances except as set forth in the Asset Purchase
      Agreement, and Assignor agrees with Assignee and its successors and assigns
      that
      Assignor will warrant and forever defend such title so conveyed against all
      claims and contrary demands whatsoever.

    


    Except
      as
      otherwise expressly set forth herein and in the Asset Purchase Agreement,
      Assignor makes no representation or warranty to Assignee regarding the
      Transferred Assets, express or implied, including without limitation any
      warranty of merchantability or fitness for a particular purpose.

    


    IN
      WITNESS WHEREOF, Assignor has executed this Second Phase Bill of Sale and
      Assignment as of the date first set forth above.

     

    
 

    Universal
      Fog,
      Inc.

    
 

    Name:
      ___________________________

    Title:
      ____________________________

     

    
 

    
      
        
        

      

      
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