Blueprint








  EXHIBIT
10.1











 


 


 


 


 



SHARE EXCHANGE AGREEMENT


 


BY AND
AMONG


 



FRIENDABLE, INC.


 


AND


 



THE PRINCIPAL SHAREHOLDERS OF FRIENDABLE, INC.


 


AND


 



SHARPS TECHNOLOGY INC.


 


AND


 



THE PRINCIPAL SHAREHOLDERS OF SHARPS TECHNOLOGY INC.


 


Dated
as of: June 27, 2018


 


 


 


 


 


 


 


 


 


 


 


 


 




 








 






 

 



TABLE OF CONTENTS


 


	

Article
I DEFINITIONS

	

1


	

Section
1.1     Definitions.

	

1


	

ARTICLE
II SHARE EXCHANGE; CLOSING

	

5


	

Section
2.1     Share Exchange.

	

5


	

Section
2.2     Closing.

	

5


	

Section
2.3     Closing Deliveries by Acquiror and
Acquiror Principal Shareholders.

	

5


	

Section
2.4     Closing Deliveries by Acquiree,
and Acquiree Principal Shareholders.

	

5


	

Section
2.5     Section 368
Reorganization.

	

5


	

ARTICLE
III REPRESENTATIONS OF ACQUIREE PRINCIPAL SHAREHOLDERS

	

6


	

Section
3.1     Authority.

	

6


	

Section
3.2     Binding Obligations.

	

6


	

Section
3.3     No Conflicts.

	

6


	

Section
3.4     Certain Proceedings.

	

7


	

Section
3.5     No Brokers or
Finders.

	

7


	

Section
3.6     Investment
Representations.

	

7


	

Section
3.7     Stock Legends.

	

8


	

Section
3.8     Disclosure.

	

9


	

Section
4.1     Organization and
Qualification.

	

9


	

Section
4.2     Authority.

	

9


	

Section
4.3     Binding Obligations.

	

10


	

Section
4.4     No Conflicts.

	

10


	

Section
4.5     Subsidiaries.

	

10


	

Section
4.6     Organizational
Documents.

	

10


	

Section
4.7     Capitalization.

	

10


	

Section
4.8     No Brokers or
Finders.

	

11


	

Section
4.9     Disclosure.

	

11


	

Section
4.10   Certain Proceedings.

	

11


	

Section
4.11   FDA.

	

11


	

Section
4.12   Intellectual Property.

	

12


	

Section
5.1     Organization and
Qualification.

	

12


	

Section
5.2     Authority.

	

12


	

Section
5.3     Binding Obligations.

	

12


	

Section
5.4     No Conflicts.

	

13


	

Section
5.5     Subsidiaries.

	

13






 



 







 





 


	

Section
5.6      Organizational
Documents/Capitalization.

	

13


	

Section
5.7      Compliance with
Laws.

	

14


	

Section
5.8      Certain Proceedings.

	

14


	

Section
5.9      No Brokers or
Finders.

	

15


	

Section
5.10    Contracts.

	

15


	

Section
5.11    Tax Matters.Tax Returns.

	

15


	

Section
5.12    Labor Matters.

	

16


	

Section
5.13    Employee Benefits.

	

16


	

Section
5.14    Title to Assets.

	

16


	

Section
5.15    Intellectual Property.

	

16


	

Section
5.16    SEC Reports.

	

16


	

Section
5.17    Internal Accounting Controls.

	

17


	

Section
5.18    Application of Takeover
Protections.

	

17


	

Section
5.19    Transactions With Affiliates and
Employees.

	

17


	

Section
5.20    Liabilities.

	

17


	

Section
5.21    Bank Accounts and Safe Deposit
Boxes.

	

17


	

Section
5.22    Investment Company.

	

17


	

Section
5.23    Bank Holding Company Act.

	

18


	

Section
5.24    Public Utility Holding Act.

	

18


	

Section
5.25    Federal Power Act.

	

18


	

Section
5.26    Money Laundering Laws.

	

18


	

Section
5.27    Foreign Corrupt Practices.

	

18


	

Section
5.28    Absence of Certain Changes or
Events.

	

18


	

Section
5.29    Disclosure.

	

18


	

Section
5.30    Undisclosed Events.

	

19


	

Section
5.31    Non-Public Information.

	

19


	

Section
5.32    Listing and Maintenance
Requirements.

	

19


	

Section
5.33    No Integrated Offering.

	

19


	

Section
5.34    Accountants.

	

19


	

Section
5.35    No Disagreements with Accountants and
Lawyers.

	

19


	

Section
5.36    No SEC or FINRA Inquiries.

	

19


	

Section
5.37    Filing Status.

	

19


	

Section
6.1      Conduct of Business.

	

20


	

Section
6.2      Restrictions on Conduct of
Business.

	

20


	

Section
6.3      Reporting Costs.

	

21


	

Section
7.1      Access to
Information.

	

22


	

Section
7.2      Legal Requirements.

	

22






 



 







 





 


	

Section
7.3      Notification of Certain
Matters.

	

22


	

Section
8.1      General.

	

22


	

Section
8.2      Litigation Support.

	

22


	

Section
8.3      Assistance with Post-Closing SEC
Reports and Inquiries.

	

23


	

Section
8.4      Public
Announcements.

	

23


	

Section
8.5      Spin Off Agreement.

	

23


	

Section
8.6      Friendable Asset Sale/Spinoff.

	

23


	

Section
9.1      Conditions to Obligation of the
Parties Generally.

	

23


	

Section
9.2      Conditions to Obligation of the
Acquiree Parties.

	

23


	

Section
9.3      Conditions to Obligation of the
Acquiror Parties.

	

26


	

Section
10.1    Grounds for Termination.

	

26


	

Section
10.2    Procedure and Effect of
Termination.

	

27


	

Section
10.3    Effect of Termination.

	

27


	

Section
11.1    Indemnification.

	

28


	

Section
11.2    Survival of Representations and
Warranties.

	

28


	

Section
11.3    Method of Asserting Claims,
Etc.

	

28


	

Section
12.1    Expenses.

	

29


	

Section
12.2    Confidentiality.

	

29


	

Section
12.3    Notices.

	

30


	

Section
12.4    Further Assurances.

	

31


	

Section
12.5    Waiver.

	

31


	

Section
12.6    Entire Agreement and
Modification.

	

31


	

Section
12.7    Assignments, Successors, and No Third-Party
Rights.

	

31


	

Section
12.8    Severability.

	

31


	

Section
12.9    Section Headings.

	

31


	

Section
12.10  Construction.

	

31


	

Section
12.11  Counterparts.

	

32


	

Section
12.12  Specific Performance.

	

32


	

Section
12.13  Governing Law; Submission to Jurisdiction.

	

32


	

Section
12.14  Waiver of Jury Trial.

	

32






 


 




 








 










 



SHARE EXCHANGE AGREEMENT



 


This
SHARE EXCHANGE AGREEMENT (“Agreement”), dated as of June 27,
2018, is made by and among FRIENDABLE, INC., a corporation
organized under the laws of Nevada (the “Acquiror”), each of the persons
listed on Schedule 1 hereto who are the principal shareholders of
the Acquiror (collectively, the “Acquiror Principal Shareholders”
and individually, an “Acquiror Shareholder”), SHARPS
TECHNOLOGY INC., a corporation organized under the laws of the
State of Wyoming (the “Acquiree”), and each of the
Persons listed on Schedule
I hereto who are principal shareholders of the Acquiree
(collectively, the “Acquiree
Principal Shareholders,” and individually an
“Acquiree Principal
Shareholder”). Each of the Acquiror, Acquiree and
Acquiree Principal Shareholders are referred to herein individually
as a “Party” and
collectively as the “Parties.”


 


RECITALS:


 


WHEREAS, the Acquiree Principal
Shareholders are the holders of all of the issued and outstanding
shares of common stock of the Acquiree (the “Acquiree Interests”);


 


WHEREAS, the Acquiree Principal
Shareholders have agreed to transfer to the Acquiror, and the
Acquiror has agreed to acquire from the Acquiree Principal
Shareholders, all of the Acquiree Interests, in exchange for the
issuance of 17,000,000 Acquiror Shares (as defined below) to the
Acquiree Principal Shareholders, which Acquiror Shares shall
constitute at least 85.00% of the issued and outstanding shares of
Acquiror Common Stock (as defined below) immediately after the
closing of the transactions contemplated herein, in each case, on
the terms and conditions as set forth herein;


 


WHEREAS, the Principal Acquiree
Stockholders will beneficially own 7,600,000 shares of Common Stock
which represents approximately 63.33% of Acquiree’s
outstanding common stock immediately prior to the
Closing.


 


NOW, THEREFORE, in consideration of the
foregoing premises, and the covenants, representations and
warranties set forth herein, and for other good and valuable
consideration, the receipt and sufficiency of which is hereby
acknowledged and accepted, the Parties, intending to be legally
bound, hereby agree as follows:


 



ARTICLE
I



DEFINITIONS


 

 


Section
1.1     Definitions.


 


For all
purposes of and under this Agreement, the following terms shall
have the following respective meanings:


 


“Accredited Investor” has the
meaning set forth in Rule 501 under the Securities
Act.


 


“Acquiree” has the meaning set
forth in the preamble.


 


“Acquiree Disclosure Schedule” has
the meaning set forth in Article IV.


 


“Acquiree Interests” has the
meaning set forth in the recitals.


 


“Acquiree Indemnified Parties”
means the Acquiree and the Acquiree Principal Shareholders and
their respective Affiliates and the officers, directors and
representatives of such Persons; provided that (i) the Acquiror
shall be a member of the Acquiree Indemnified Parties after the
Closing and (ii) none of the Acquiror Principal Shareholders nor
the Acquiror Principal Shareholders’ Affiliates shall be
members of the Acquiree Indemnified Parties at any
time.


 


“Acquiree Organizational Documents”
has the meaning set forth in Section 4.6.


 


“Acquiree Shareholder” and
“Acquiree Principal
Shareholders” have the respective meanings set forth
in the preamble.


 



 

1







 






 


“Acquiror” has the meaning set
forth in the recitals.


 


“Acquiror Common Stock” means the
common stock, par value $0.001 per share, of the
Acquiror.


 


“Acquiror Disclosure Schedule” has
the meaning set forth in Article V.


 


“Acquiror Most Recent Fiscal Year
End” means December 31, 2017.


 


“Acquiror Principal Shareholderss”
has the meaning set forth in the preamble.


 


“Acquiror Shares” has the meaning
set forth in the recitals.


 


“Acquiror Shareholders” means
entities or individuals holding Acquiror Shares.


 


“Acquisition Transaction” means any
transaction or series of transactions involving: (a) any merger,
consolidation, share exchange, business combination, issuance of
securities, acquisition of securities, tender offer, exchange offer
or other similar transaction; or (b) any sale (other than sales of
inventory in the Ordinary Course of Business), lease (other than in
the Ordinary Course of Business), exchange, transfer (other than
sales of inventory in the Ordinary Course of Business), license
(other than nonexclusive licenses in the Ordinary Course of
Business), acquisition or disposition of assets.


 


“Action” means any action, suit,
inquiry, notice of violation, proceeding (including any partial
proceeding such as a deposition) or investigation pending or
threatened before or by any court, arbitrator, governmental or
administrative agency, regulatory authority (federal, state,
county, local or foreign), stock market, stock exchange or trading
facility.


 


“Affiliate” has the meaning set
forth in Rule 12b-2 of the regulations promulgated under the
Exchange Act.


 


“Agreement” has the meaning set
forth in the preamble.


 


“BHCA” has the meaning set forth in
Section
5.23.


 


“Business Day” shall mean any day
other than a Saturday, Sunday or a day on which commercial banks in
New York, New York are required or authorized to be
closed.


 


“Closing” has the meaning set forth
in Section
2.2.


 


“Closing Date” has the meaning set
forth in Section
2.2.


 


“Code” means the Internal Revenue
Code of 1986, as amended.


 


“Competing Transaction Proposal”
means any inquiry, proposal, indication of interest or offer from
any Person contemplating or otherwise relating to any Acquisition
Transaction directly or indirectly involving the Acquiror, its
business or any assets of the Acquiror (including, without
limitation, any Acquisition Transaction involving Acquiror
Principal Shareholders that would include the Acquiror, its
business or any assets of the Acquiror).


 


“Contract” means any written or
oral contract, lease, license, indenture, note, bond, agreement,
arrangement, understanding, permit, concession, franchise or other
instrument.


 


“ERISA” means the Employee
Retirement Income Security Act of 1974, as amended.


 


“Exchange Act” means the Securities
Exchange Act of 1934, as amended, or any similar federal statute,
and the rules and regulations of the SEC thereunder, all as the
same will then be in effect.


 


“Fan Pass, Inc.” means the
Acquiror’s wholly-owned subsidiary.


 



 

2







 






 


“Federal Reserve” has the meaning
set forth in Section
5.23.


 


“GAAP” means, with respect to any
Person, generally accepted accounting principles in the U.S.
applied on a consistent basis with such Person’s past
practices.


 


“Governmental Authority” means any
domestic or foreign, federal or national, state or provincial,
municipal or local government, governmental authority, regulatory
or administrative agency, governmental commission, department,
board, bureau, agency or instrumentality, political subdivision,
commission, court, tribunal, official, arbitrator or arbitral
body.


 


“Indebtedness” means without
duplication, (a) all indebtedness or other obligation of the Person
for borrowed money, whether current, short-term, or long-term,
secured or unsecured, (b) all indebtedness of the Person for the
deferred purchase price for purchases of property outside the
Ordinary Course of Business, (c) all lease obligations of the
Person under leases which are capital leases in accordance with
GAAP, (d) any off-balance sheet financing of the Person including
synthetic leases and project financing, (e) any payment obligations
of the Person in respect of banker’s acceptances or letters
of credit (other than stand-by letters of credit in support of
ordinary course trade payables), (f) any liability of the Person
with respect to interest rate swaps, collars, caps and similar
hedging obligations, (g) any liability of the Person under deferred
compensation plans, phantom stock plans, severance or bonus plans,
or similar arrangements made payable as a result of the
transactions contemplated herein, (h) any indebtedness referred to
in clauses (a) through (g) above of any other Person which is
either guaranteed by, or secured by a security interest upon any
property owned by, the Person and (i) accrued and unpaid interest
of, and prepayment premiums, penalties or similar contractual
charges arising as result of the discharge at Closing of, any such
foregoing obligation.


 


“Intellectual Property” means all
industrial and intellectual property, including, without
limitation, all U.S. and non-U.S. patents, patent applications,
patent rights, trademarks, trademark applications, common law
trademarks, Internet domain names, trade names, service marks,
service mark applications, common law service marks, and the
goodwill associated therewith, copyrights, in both published and
unpublished works, whether registered or unregistered, copyright
applications, franchises, licenses, know-how, trade secrets,
technical data, designs, customer lists, confidential and
proprietary information, processes and formulae, all computer
software programs or applications, layouts, inventions, development
tools and all documentation and media constituting, describing or
relating to the above, including manuals, memoranda, and records,
whether such intellectual property has been created, applied for or
obtained anywhere throughout the world. For purposes of
clarification, Intellectual Property does not include any of the
foregoing as they relate to Fan Pass, Inc.


 


“Knowledge” shall mean, except as
otherwise explicitly provided herein, actual knowledge after
reasonable investigation. The Acquiror shall be deemed to have
“Knowledge” of a matter if any of its officers,
directors, stockholders, or employees has Knowledge of such matter.
Phrases such as “to the Knowledge of the Acquiror” or
the “Acquiror’s Knowledge” shall be construed
accordingly.


 


“Laws” means, with respect to any
Person, any U.S. or non-U.S., federal, national, state, provincial,
local, municipal, international, multinational or other Law
(including common law), constitution, statute, code, ordinance,
rule, regulation or treaty applicable to such Person.


 


“Liability” means any liability
(whether known or unknown, whether asserted or unasserted, whether
absolute or contingent, whether accrued or unaccrued, whether
liquidated or unliquidated, and whether due or to become due),
including any liability for Taxes.


 


“License” means any security
clearance, permit, license, variance, franchise, Order, approval,
consent, certificate, registration or other authorization of any
Governmental Authority or regulatory body, and other similar
rights.


 


“Lien” means any mortgage, pledge,
security interest, encumbrance, lien or charge of any kind,
including, without limitation, any conditional sale or other title
retention agreement, any lease in the nature thereof and the filing
of or agreement to give any financing statement under the Uniform
Commercial Code of any jurisdiction and including any lien or
charge arising by Law.


 



 

3







 






 


“Material Adverse Effect” means,
with respect to any Person, a material adverse effect on the
business, financial condition, operations, results of operations,
assets, customer, supplier or employee relations or future
prospects of such Person.


 


“Money Laundering Laws” has the
meaning set forth in Section 5.26.


 


“Order” means any order, judgment,
ruling, injunction, assessment, award, decree or writ of any
Governmental Authority or regulatory body.


 


“Ordinary Course of Business” means
the ordinary course of business consistent with past custom and
practice (including with respect to quantity and
frequency).


 


“Party” and “Parties” have the respective
meanings set forth in the preamble.


 


“Person” means all natural persons,
corporations, business trusts, associations, companies,
partnerships, limited liability companies, joint ventures and other
entities, governments, agencies and political
subdivisions.


 


“Principal Market” means the OTC
Pink Marketplace.


 


“Registration Statements” has the
meaning set forth in Section 5.16(b).


 


“Regulation S” means Regulation S
under the Securities Act, as the same may be amended from time to
time, or any similar rule or regulation hereafter adopted by the
Commission.


 


“S-1 Registration Statement” means
the S-1 registration statement to be filed by Fan Pass, Inc.
contemporaneously with the execution of this Agreement for the
distribution and registration of the common stock of
Acquiror’s wholly owned subsidiary, Fan Pass,
Inc.


 


“SEC” means the U.S. Securities and
Exchange Commission, or any successor agency thereto.


 


“SEC Reports” has the meaning set
forth in Section
5.16(a).


 


“Securities Act” means the
Securities Act of 1933, as amended, or any similar federal statute,
and the rules and regulations of the Commission thereunder, all as
the same will be in effect at the time.


 


“Share Exchange” has the meaning
set forth in Section
2.1.


 


“Spinoff Separation Agreement”
means the agreement for the spin off of 100% of Fan Pass,
Inc.


 


“Tax Return” means all returns,
declarations, reports, estimates, statements, forms and other
documents filed with or supplied to or required to be provided to a
Governmental Authority with respect to Taxes, including any
schedule or attachment thereto and any amendment
thereof.


 


“Tax” or “Taxes” means all taxes,
assessments, duties, levies or other charge imposed by any
Governmental Authority of any kind whatsoever together with any
interest, penalties, fines or additions thereto and any liability
for payment of taxes whether as a result of (i) being a member of
an affiliated, consolidated, combined, unitary or similar group for
any period, (ii) any tax sharing, tax indemnity or tax allocation
agreement or any other express or implied agreement to indemnify
any Person, (iii) being liable for another Person’s taxes as
a transferee or successor otherwise for any period, or (iv)
operation of Law.


 


“Transaction Documents” means,
collectively, this Agreement and all agreements, certificates,
instruments and other documents to be executed and delivered in
connection with the transactions contemplated by this
Agreement.


 



 

4







 






 


“Treasury Regulations” means the
income tax regulations, including temporary regulations,
promulgated under the Code, as such regulations may be amended from
time to time (including corresponding provisions of succeeding
regulations).


 


“U.S.” means the United States of
America.


 


“U.S. Person” has the meaning set
forth in Regulation S under the Securities Act.


 



ARTICLE
II


SHARE
EXCHANGE; CLOSING


 


Section
2.1     Share Exchange.
At the Closing, the Acquiree shall
sell, transfer, convey, assign and deliver shares of Acquiree
Interests, representing 100% of the issued and outstanding shares
of common stock of the Acquiree, to the Acquiror, and in
consideration therefor the Acquiror shall issue a total of
17,000,000 fully paid and nonassessable share of Acquiror Common
Stock, par value $0.0001, (the “Acquiror Shares”) to
the Acquiree Principal Shareholders, as set forth beside the name
of each such Acquiree Shareholder on Schedule I
hereto (the “Share
Exchange”) which shall equal 85% of the Acquiror’s
total outstanding shares on a fully diluted basis at the time of
the Closing, except that the shares of Common Stock issuable upon
conversion of the Convertible Notes, as defined herein and any
shares that the Company may sell at $0.80 per share (including the
Shares to be sold to Alpha) (the Second Tranche Shares”)
between the date hereof and the Closing Date are not included in
such percentage calculation. The amount of Acquiror Shares that
will be issued in exchange for any Second Tranche Shares shall be
multiplied by the Exchange Ratio as defined below. The Exchange
Ratio shall be 1.44 shares of Acquiror Common Stock for each share
of Acquiree Common Stock.


 


Section
2.2     Closing.
Upon the terms and subject to the conditions of this Agreement, the
transactions contemplated by this Agreement shall take place at a
closing (the “Closing”) to be held at the offices of
Grushko & Mittman, P.C., located at 515 Rockaway Avenue, Valley
Stream, New York 11581, at a time and date to be specified by the
Parties, which shall be no later than the second (2nd) Business Day
following the satisfaction or, if permitted pursuant hereto, waiver
of the conditions set forth in Article X, or at such other
location, date and time as Acquiree and Acquiror Principal
Shareholders shall mutually agree. The date and time of the Closing
is referred to herein as the “Closing Date.”


 


Section
2.3     Closing Deliveries by
Acquiror and Acquiror Principal Shareholders. At the Closing: (a) the Acquiror shall deliver,
or cause to be delivered, certificates evidencing the number of
Acquiror Shares, set forth beside each Acquiror Shareholder’s
name on Schedule I
hereto; and (b) the Acquiror and the
Acquiror Principal Shareholders, as applicable, shall deliver, or
cause to be delivered, to the Acquiree and the Acquiree Principal
Shareholders, as applicable, the various documents required to be
delivered as a condition to the Closing pursuant to
Section
9.2 hereof.


 


Section
2.4     Closing Deliveries by
Acquiree, and Acquiree Principal Shareholders. At the Closing: (a) Acquiree shall deliver, or
cause to be delivered, certificate(s) representing its Acquiree
Shares, accompanied by an executed instrument of transfer for
transfer by Acquiree of its Acquiree Shares to the Acquiror; and
(b) the Acquiree, and the Acquiree Principal Shareholders, as
applicable, shall deliver, or cause to be delivered, to the
Acquiror and the Acquiror Principal Shareholders, as applicable,
the various documents required to be delivered as a condition to
the Closing pursuant to Section 9.3
hereof.


 



 

5







 






 


Section
2.5     Section 368
Reorganization. For U.S.
federal income Tax purposes, the Share Exchange is intended to
constitute a “reorganization” within the meaning of
Section 368(a)(1)(B) of the Code. The Parties hereby adopt this
Agreement as a “plan of reorganization” within the
meaning of Sections 1.368-2(g) and 1.368-3(a) of the Treasury
Regulations. Notwithstanding the foregoing or anything else to the
contrary contained in this Agreement, the Parties acknowledge and
agree that no Party is making any representation or warranty as to
the qualification of the Share Exchange as a reorganization under
Section 368 of the Code or as to the effect, if any, that any
transaction consummated prior to or after the Closing Date has or
may have on any such reorganization status. The Parties acknowledge
and agree that each (i) has had the opportunity to obtain
independent legal and tax advice with respect to the transaction
contemplated by this Agreement, and (ii) is responsible for paying
its own Taxes, including without limitation, any adverse Tax
consequences that may result if the transaction contemplated by
this Agreement is not determined to qualify as a reorganization
under Section 368 of the Code.


 



ARTICLE
III


REPRESENTATIONS
OF ACQUIREE PRINCIPAL SHAREHOLDERS


 


The
Acquiree Principal Shareholders severally, and not jointly, hereby
represent and warrant to the Acquiror that the statements contained
in this Article III
are correct and complete as of the date of this Agreement and will
be correct and complete as of the Closing Date (as though made then
and as thought the Closing Date were substituted for the date of
this Agreement throughout this Article III) (except where
another date or period of time is specifically stated herein for a
representation or warranty).


 


Section
3.1     Authority.
Such Acquiree Principal Shareholders have all requisite authority
and power to enter into and deliver this Agreement and any of the
other Transaction Documents to which such Acquiree Principal
Shareholders is a party, and any other certificate, agreement,
document or instrument to be executed and delivered by such
Acquiree Principal Shareholders in connection with the transactions
contemplated hereby and thereby and to perform its obligations
hereunder and thereunder and to consummate the transactions
contemplated hereby and thereby. This Agreement has been, and each
of the Transaction Documents to which such Acquiree Principal
Shareholders is a party will be, duly and validly authorized and
approved, executed and delivered by such Acquiree Principal
Shareholders.


 


Section
3.2     Binding
Obligations. Assuming this
Agreement and the Transaction Documents have been duly and validly
authorized, executed and delivered by the parties hereto and
thereto other than such Acquiree Principal Shareholders, this
Agreement and each of the Transaction Documents to which such
Acquiree Principal Shareholders is a party are duly authorized,
executed and delivered by such Acquiree Principal Shareholders, and
constitutes the legal, valid and binding obligations of such
Acquiree Principal Shareholders, enforceable against such Acquiree
Principal Shareholders in accordance with their respective terms,
except as such enforcement is limited by general equitable
principles, or by bankruptcy, insolvency and other similar Laws
affecting the enforcement of creditors rights
generally.


 


Section
3.3     No Conflicts. Neither the
execution or delivery by such Acquiree Principal Shareholders of
this Agreement or any Transaction Document to which such Acquiree
Principal Shareholders is a party, nor the consummation or
performance by such Acquiree Principal Shareholders of the
transactions contemplated hereby or thereby will, directly or
indirectly, (a) contravene, conflict with, or result in a violation
of any provision of the organizational documents of such Acquiree
Principal Shareholders (if such Acquiree Principal Shareholders is
not a natural Person); (b) contravene, conflict with, constitute a
default (or an event or condition which, with notice or lapse of
time or both, would constitute a default) under, or result in the
termination or acceleration of, any agreement or instrument to
which such Acquiree Principal Shareholders is a party or by which
the properties or assets of such Acquiree Principal Shareholders
are bound; or (c) contravene, conflict with, result in any breach
of, or constitute a default (or an event that with notice or lapse
of time or both would become a default) under, impair the rights of
such Acquiree Principal Shareholders under, or alter the
obligations of any Person under, or create in any Person the right
to terminate, amend, accelerate or cancel, or require any notice,
report or other filing (whether with a Governmental Authority or
any other Person) pursuant to, or result in the creation of a Lien
on any of the assets or properties of the Acquiror under, any note,
bond, mortgage, indenture, Contract, License, permit, franchise or
other instrument or obligation to which such Acquiree Principal
Shareholders is a party or any of such Acquiree Principal
Shareholders’s assets and properties are bound or affected,
except, in the case of clauses (b) or (c) for any such
contraventions, conflicts, violations, or other occurrences as
would not have a Material Adverse Effect on such Acquiree Principal
Shareholders.


 



 

6







 






 


Section
3.4     Certain
Proceedings. There is no Action
pending against, or to the Knowledge of such Acquiree Principal
Shareholders, threatened against or affecting, such Acquiree
Principal Shareholders by any Governmental Authority or other
Person with respect to such Acquiree Principal Shareholders that
challenges, or may have the effect of preventing, delaying, making
illegal, or otherwise interfering with, any of the transactions
contemplated by this Agreement.


 


Section
3.5     No Brokers or
Finders. No Person has, or as a
result of the transactions contemplated herein will have, any right
or valid claim against such Acquiree Principal Shareholders for any
commission, fee or other compensation as a finder or broker, or in
any similar capacity, based upon arrangements made by or on behalf
of such Acquiree Principal Shareholders and such Acquiree Principal
Shareholders will indemnify and hold the Acquiror and the Acquiror
Principal Shareholderss harmless against any liability or expense
arising out of, or in connection with, any such
claim.


 


Section
3.6     Investment
Representations. Each Acquiree
Principal Shareholders severally, and not jointly, hereby
represents and warrants, solely with respect to itself and not any
other Acquiree Principal Shareholders, to the Acquiror as
follows:


 


(a)     Purchase
Entirely for Own Account. Such Acquiree Principal
Shareholders is acquiring such Acquiree Principal
Shareholders’ portion of the Acquiror Shares proposed to be
acquired hereunder for investment for its own account and not with
a view to the resale or distribution of any part thereof, and such
Acquiree Principal Shareholders has no present intention of selling
or otherwise distributing such Acquiror Shares, except in
compliance with applicable securities Laws.


 


(b)     Restricted
Securities. Such Acquiree Principal Shareholders understands
that the Acquiror Shares are characterized as “restricted
securities” under the Securities Act inasmuch as this
Agreement contemplates that, if acquired by the Shareholder
pursuant hereto, the Acquiror Shares would be acquired in a
transaction not involving a public offering. The issuance of the
Acquiror Shares hereunder is being effected in reliance upon an
exemption from registration afforded under Section 4(2) of the
Securities Act. Such Acquiree Principal Shareholders further
acknowledges that if the Acquiror Shares are issued to such
Acquiree Principal Shareholders in accordance with the provisions
of this Agreement, such Acquiror Shares may not be resold without
registration under the Securities Act or the existence of an
exemption therefrom. Such Acquiree Principal Shareholders
represents that he is familiar with Rule 144 promulgated under the
Securities Act, as presently in effect, and understands the resale
limitations imposed thereby and by the Securities Act


 


(c)     Acknowledgment
of Non-Registration. Such Acquiree Principal Shareholders
understands and agrees that the Acquiror Shares to be issued
pursuant to this Agreement have not been registered under the
Securities Act or the securities Laws of any state of the
U.S.


 


(d)     Status.
By its execution of this Agreement, each Acquiree Principal
Shareholders represents and warrants to the Acquiror as indicated
on its signature page to this Agreement, either that: (i) such
Acquiree Principal Shareholders is an Accredited Investor; or (ii)
such Acquiree Principal Shareholders is not a U.S. Person. Each
Acquiree Principal Shareholders understands that the Acquiror
Shares are being offered and sold to such Acquiree Principal
Shareholders in reliance upon the truth and accuracy of the
representations, warranties, agreements, acknowledgments and
understandings of such Acquiree Principal Shareholders set forth in
this Agreement, in order that the Acquiror may determine the
applicability and availability of the exemptions from registration
of the Acquiror Shares on which the Acquiror is
relying.


 



 

7







 






 


(e)     Additional
Representations and Warranties. Such Acquiree Principal
Shareholders, severally and not jointly, further represents and
warrants to the Acquiror as follows: (i) such Person qualifies as
an Accredited Investor; (ii) such Person consents to the placement
of a legend on any certificate or other document evidencing the
Acquiror Shares substantially in the form set forth in Section 3.7(a); (iii) such
Person has sufficient knowledge and experience in finance,
securities, investments and other business matters to be able to
protect such Person’s or entity’s interests in
connection with the transactions contemplated by this Agreement;
(iv) such Person has consulted, to the extent that it has deemed
necessary, with its tax, legal, accounting and financial advisors
concerning its investment in the Acquiror Shares and can afford to
bear such risks for an indefinite period of time, including,
without limitation, the risk of losing its entire investment in the
Acquiror Shares; (v) such Person has had access to the SEC Reports;
(vi) such Person has been furnished during the course of the
transactions contemplated by this Agreement with all other public
information regarding the Acquiror that such Person has requested
and all such public information is sufficient for such Person to
evaluate the risks of investing in the Acquiror Shares; (vii) such
Person has been afforded the opportunity to ask questions of and
receive answers concerning the Acquiror and the terms and
conditions of the issuance of the Acquiror Shares; (viii) such
Person is not relying on any representations and warranties
concerning the Acquiror made by the Acquiror or any officer,
employee or agent of the Acquiror, other than those contained in
this Agreement or the SEC Reports; (ix) such Person will not sell
or otherwise transfer the Acquiror Shares, unless either (A) the
transfer of such securities is registered under the Securities Act
or (B) an exemption from registration of such securities is
available; (x) such Person understands and acknowledges that the
Acquiror is under no obligation to register the Acquiror Shares for
sale under the Securities Act; (xi) such Person represents that the
address furnished in Schedule I is the principal
residence if he is an individual or its principal business address
if it is a corporation or other entity; (xii) such Person
understands and acknowledges that the Acquiror Shares have not been
recommended by any federal or state securities commission or
regulatory authority, that the foregoing authorities have not
confirmed the accuracy or determined the adequacy of any
information concerning the Acquiror that has been supplied to such
Person and that any representation to the contrary is a criminal
offense; and (xiii) such Person acknowledges that the
representations, warranties and agreements made by such Person
herein shall survive the execution and delivery of this Agreement
and the purchase of the Acquiror Shares.


 


(f)     Additional
Representations and Warranties of Non-U.S. Persons. Each
Acquiree Principal Shareholders that is not a U.S. Person,
severally and not jointly, further represents and warrants to the
Acquiror as follows: (i) at the time of (A) the offer by the
Acquiror and (B) the acceptance of the offer by such Person, of the
Acquiror Shares, such Person was outside the U.S; (ii) no offer to
acquire the Acquiror Shares or otherwise to participate in the
transactions contemplated by this Agreement was made to such Person
or its representatives inside the U.S.; (iii) such Person is not
purchasing the Acquiror Shares for the account or benefit of any
U.S. Person, or with a view towards distribution to any U.S.
Person, in violation of the registration requirements of the
Securities Act; (iv) such Person will make all subsequent offers
and sales of the Acquiror Shares either (A) outside of the U.S. in
compliance with Regulation S; (B) pursuant to a registration under
the Securities Act; or (C) pursuant to an available exemption from
registration under the Securities Act; (v) such Person is acquiring
the Acquiror Shares for such Person’s own account, for
investment and not for distribution or resale to others; (vi) such
Person has no present plan or intention to sell the Acquiror Shares
in the U.S. or to a U.S. Person at any predetermined time, has made
no predetermined arrangements to sell the Acquiror Shares and is
not acting as an underwriter or dealer with respect to such
securities or otherwise participating in the distribution of such
securities; (vii) neither such Person, its Affiliates nor any
Person acting on behalf of such Person, has entered into, has the
intention of entering into, or will enter into any put option,
short position or other similar instrument or position in the U.S.
with respect to the Acquiror Shares at any time after the Closing
Date through the one year anniversary of the Closing Date except in
compliance with the Securities Act; (viii) such Person consents to
the placement of a legend on any certificate or other document
evidencing the Acquiror Shares substantially in the form set forth
in Section 3.7(b)
and (ix) such Person is not acquiring the Acquiror Shares in a
transaction (or an element of a series of transactions) that is
part of any plan or scheme to evade the registration provisions of
the Securities Act.


 


Section
3.7     Stock
Legends. Such Acquiree
Principal Shareholders hereby agrees with the Acquiror as
follows:


 


(a)     The
certificates evidencing the Acquiror Shares issued to those
Acquiree Principal Shareholders who are Accredited Investors, and
each certificate issued in transfer thereof, will bear the
following or similar legend:


 



 

8







 






 


THE
SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES
ACT”), OR ANY STATE SECURITIES LAWS AND NEITHER SUCH
SECURITIES NOR ANY INTEREST THEREIN MAY BE OFFERED, SOLD, PLEDGED,
ASSIGNED OR OTHERWISE TRANSFERRED EXCEPT (1) PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND
APPLICABLE STATE SECURITIES LAWS OR (2) PURSUANT TO AN AVAILABLE
EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT
AND APPLICABLE STATE SECURITIES LAWS, IN WHICH CASE THE HOLDER
MUST, PRIOR TO SUCH TRANSFER, FURNISH TO THE COMPANY AN OPINION OF
COUNSEL, WHICH COUNSEL AND OPINION ARE REASONABLY SATISFACTORY TO
THE COMPANY, THAT SUCH SECURITIES MAY BE OFFERED, SOLD, PLEDGED,
ASSIGNED OR OTHERWISE TRANSFERRED IN THE MANNER CONTEMPLATED
PURSUANT TO AN AVAILABLE EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT AND APPLICABLE STATE SECURITIES
LAWS.


 


(b)     Other
Legends. The certificates representing such Acquiror Shares,
and each certificate issued in transfer thereof, will also bear any
other legend required under any applicable Law, including, without
limitation, any state corporate and state securities law, or
Contract.


 


Section
3.8     Disclosure.
No representation or warranty of such Acquiree Principal
Shareholder contained in this Agreement or any other Transaction
Document and no statement or disclosure made by or on behalf of
such Acquiree Principal Shareholder to the Acquiror or the Acquiror
Principal Shareholders pursuant to this Agreement or any other
agreement contemplated herein contains an untrue statement of a
material fact or omits to state a material fact necessary to make
the statements contained herein or therein not
misleading.


 



ARTICLE IV



REPRESENTATIONS AND WARRANTIES OF THE ACQUIREE


 


The
Acquiree hereby represents and warrants to the Acquiror, subject to
the exceptions and qualifications specifically set forth or
disclosed in writing in the disclosure schedule delivered by the
Acquiree to the Acquiror (the “Acquiree Disclosure Schedule”),
that the statements contained in this Article IV are correct and
complete as of the date of this Agreement and will be correct and
complete as of the Closing Date (as though made then and as thought
the Closing Date were substituted for the date of this Agreement
throughout this Article
IV) (except where another date or period of time is
specifically stated herein for a representation or warranty). The
Acquiree Disclosure Schedule shall be arranged according to the
numbered and lettered paragraphs of this Article IV and any disclosure
in the Acquiree Disclosure Schedule shall qualify the corresponding
paragraph in this Article
IV. The Acquiror and, after the Closing, the Acquiree, shall
be entitled to rely on the representations and warranties set forth
in this Article IV
regardless of any investigation or review conducted by the Acquiror
prior to the Closing.


 


Section
4.1     Organization and
Qualification. The Acquiree is
a corporation duly organized, validly existing and in good standing
under the Laws of the jurisdiction of its incorporation or
organization, has all requisite corporate authority and power,
Licenses, authorizations, consents and approvals to carry on its
business as presently conducted and to own, hold and operate its
properties and assets as now owned, held and operated by it, and is
duly qualified to do business and in good standing in each
jurisdiction in which the failure to be so qualified would not
reasonably be expected, individually or in the aggregate, to have a
Material Adverse Effect on the Acquiree.


 


Section
4.2     Authority. The Acquiree has all
requisite authority and power (corporate and other), Licenses,
authorizations, consents and approvals to enter into and deliver
this Agreement and any of the other Transaction Documents to which
the Acquiree is a party and any other certificate, agreement,
document or instrument to be executed and delivered by the Acquiree
in connection with the transactions contemplated hereby and thereby
and to perform its obligations hereunder and thereunder and to
consummate the transactions contemplated hereby and thereby. The
execution and delivery of this Agreement and the other Transaction
Documents by the Acquiree and the performance by the Acquiree of
its obligations hereunder and thereunder and the consummation by
the Acquiree of the transactions contemplated hereby and thereby
have been duly authorized by all necessary action on the part of
the Acquiree. The Acquiree does not need to give any notice to,
make any filing with, or obtain any authorization, consent or
approval of any Person or Governmental Authority in order for the
Parties to execute, deliver or perform this Agreement or the
transactions contemplated hereby. This Agreement has been, and each
of the Transaction Documents to which the Acquiree is a party will
be, duly and validly authorized and approved, executed and
delivered by the Acquiree.


 



 

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Section
4.3     Binding
Obligations. Assuming this
Agreement and the Transaction Documents have been duly and validly
authorized, executed and delivered by the parties hereto and
thereto other than the Acquiree, this Agreement and each of the
Transaction Documents to which the Acquiree is a party are duly
authorized, executed and delivered by the Acquiree and constitutes
the legal, valid and binding obligations of the Acquiree
enforceable against the Acquiree in accordance with their
respective terms, except as such enforcement is limited by general
equitable principles, or by bankruptcy, insolvency and other
similar Laws affecting the enforcement of creditors rights
generally.


 


Section
4.4     No
Conflicts. Neither the
execution nor the delivery by the Acquiree of this Agreement or any
Transaction Document to which the Acquiree is a party, nor the
consummation or performance by the Acquiree of the transactions
contemplated hereby or thereby will, directly or indirectly, (a)
contravene, conflict with, or result in a violation of any
provision of the Acquiree Organizational Documents, (b) contravene,
conflict with or result in a violation of any Law, Order, charge or
other restriction or decree applicable to the Acquiree, or by which
the Acquiree or any of its respective assets and properties are
bound or affected, (c) contravene, conflict with, result in any
breach of, or constitute a default (or an event that with notice or
lapse of time or both would become a default) under, impair the
rights of the Acquiree under, or alter the obligations of any
Person under, or create in any Person the right to terminate,
amend, accelerate or cancel, or require any notice, report or other
filing (whether with a Governmental Authority or any other Person)
pursuant to, or result in the creation of a Lien on any of the
assets or properties of the Acquiree under, any note, bond,
mortgage, indenture, Contract, License, permit, franchise or other
instrument or obligation to which the Acquiree is a party or by
which the Acquiree or any of its respective assets and properties
are bound or affected; or (d) contravene, conflict with, or result
in a violation of, the terms or requirements of, or give any
Governmental Authority the right to revoke, withdraw, suspend,
cancel, terminate or modify, any licenses, permits, authorizations,
approvals, franchises or other rights held by the Acquiree or that
otherwise relate to the business of, or any of the properties or
assets owned or used by, the Acquiree, except, in the case of
clauses (b), (c), or (d), for any such contraventions, conflicts,
violations, or other occurrences as would not have a Material
Adverse Effect on the Acquiree.


 


Section
4.5     Subsidiaries.
The Acquiree does not own, directly or indirectly, any equity or
other ownership interest in any corporation, partnership, joint
venture or other entity or enterprise. There are no Contracts or
other obligations (contingent or otherwise) of the Acquiree to
retire, repurchase, redeem or otherwise acquire any outstanding
shares of capital stock of, or other ownership interests in, any
other Person or to provide funds to or make any investment (in the
form of a loan, capital contribution or otherwise) in any other
Person.

 


Section
4.6     Organizational Documents. The
Acquiree has delivered or made available to the Acquiror a true and
correct copy of the Certificate of Organization of the Acquiree and
any other organizational documents of the Acquiree, each as
amended, and each such instrument is in full force and effect (the
“Acquiree Organizational Documents”). The Acquiree is
not in violation of any of the provisions of the Acquiree
Organizational Documents.  


 


Section
4.7     Capitalization. The authorized
capital stock of the Acquiree consists of 20,000,000 shares of
common stock and 10,000 shares of undesignated preferred stock.
Except as set forth in this Section, no units or other voting
securities of the Acquiree were issued, reserved for issuance or
outstanding. All outstanding shares of the Acquiree are, and all
such units that may be issued prior to the Closing Date will be
when issued, duly authorized, validly issued, fully paid and
nonassessable and not subject to or issued in violation of any
right of first refusal, preemptive right, subscription right or any
similar right under any provision of the Laws of the jurisdiction
of the Acquiree’s formation, the Acquiree Organizational
Documents or any Contract to which the Acquiree is a party or
otherwise bound although certain of such shares issued to officers,
directors and consultants are subject to certain vesting schedules,
all as set forth on Schedule 4.7(a). There are not
any bonds, debentures, notes or other Indebtedness of the Acquiree
having the right to vote (or convertible into, or exchangeable for,
securities having the right to vote) on any matters on which
holders of Acquiree Interests may vote. Except as provided
otherwise on Schedule 4.7, there are no options, warrants, rights,
convertible or exchangeable securities, “phantom” stock
rights, stock appreciation rights, stock-based performance units,
commitments, Contracts, arrangements or undertakings of any kind to
which the Acquiree is a party or by which it is bound (x)
obligating the Acquiree to issue, deliver or sell, or cause to be
issued, delivered or sold, additional units or other equity
interests in, or any security convertible or exercisable for or
exchangeable into any unit of or other equity interest in, the
Acquiree, or (y) that give any Person the right to receive any
economic benefit or right similar to or derived from the economic
benefits and rights occurring to unit holders of the Acquiree.
There are no outstanding Contracts or obligations of the Acquiree
to repurchase, redeem or otherwise acquire any units of the
Acquiree. There are no registration rights, proxies, voting trust
agreements or other agreements or understandings with respect to
any units of the Acquiree, except that the Company’s
Executive Chairman is the owner of one (1) share of
Acquiree’s Series A Preferred Stock which entitles the owner
to vote 50.1% of the total voting stock on any matter related to
the election of directors submitted to a vote of
shareholders.


 



 

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Section
4.8     No Brokers or Finders. No
Person has, or as a result of the transactions contemplated herein
will have, any right or valid claim against the Acquiree for any
commission, fee or other compensation as a finder or broker, or in
any similar capacity, based upon arrangements made by or on behalf
of the Acquiree, and the Acquiree will indemnify and hold the
Acquiror and the Acquiror Principal Shareholderss and harmless
against any liability or expense arising out of, or in connection
with, any such claim.


 


Section
4.9     Disclosure. No representation
or warranty of the Acquiree contained in this Agreement and no
statement or disclosure made by or on behalf of the Acquiree to the
Acquiror or the Acquiror Principal Shareholderss pursuant to this
Agreement or any other agreement contemplated herein contains an
untrue statement of a material fact or omits to state a material
fact necessary to make the statements contained herein or therein
not misleading.

 


Section 4.10 Certain Proceedings. There is
no Action pending against, threatened against or affecting the
Acquiree by any Governmental Agency or other Person with respect to
Acquiree that challenge, or may have the effect of preventing,
delaying, making illegal or otherwise interfering with any of the
transactions contemplated by this Agreement. 

 


Section
4.11 FDA. As to
each product subject to the jurisdiction of the U.S. Food and Drug
Administration (“FDA”) under the Federal Food, Drug and
Cosmetic Act, as amended, and the regulations thereunder
(“FDCA”) that is manufactured, packaged, labeled,
tested, distributed, sold, and/or marketed by Acquiree or any of
its Subsidiaries (each such product, a “Pharmaceutical
Product”), such Pharmaceutical Product is being manufactured,
packaged, labeled, tested, distributed, sold and/or marketed by
Acquiree in compliance with all applicable requirements under FDCA
and similar laws, rules and regulations relating to registration,
investigational use, premarket clearance, licensure, or application
approval, good manufacturing practices, good laboratory practices,
good clinical practices, product listing, quotas, labeling,
advertising, record keeping and filing of reports, except where the
failure to be in compliance would not have a Material Adverse
Effect. There is no pending, completed or, to Acquiree's knowledge,
threatened, action (including any lawsuit, arbitration, or legal or
administrative or regulatory proceeding, charge, complaint, or
investigation) against Acquiree or any of its Subsidiaries, and
none of Acquiree or any of its Subsidiaries has received any
notice, warning letter or other communication from the FDA or any
other governmental entity, which (i) contests the premarket
clearance, licensure, registration, or approval of, the uses of,
the distribution of, the manufacturing or packaging of, the testing
of, the sale of, or the labeling and promotion of any
Pharmaceutical Product, (ii) withdraws its approval of, requests
the recall, suspension, or seizure of, or withdraws or orders the
withdrawal of advertising or sales promotional materials relating
to, any Pharmaceutical Product, (iii) imposes a clinical hold on
any clinical investigation by Acquiree or any of its Subsidiaries,
(iv) enjoins production at any facility of Acquiree or any of its
Subsidiaries, (v) enters or proposes to enter into a consent decree
of permanent injunction with Acquiree or any of its Subsidiaries,
or (vi) otherwise alleges any violation of any laws, rules or
regulations by Acquiree or any of its Subsidiaries, and which,
either individually or in the aggregate, would have a Material
Adverse Effect. The properties, business and operations of Acquiree
have been and are being conducted in all material respects in
accordance with all applicable laws, rules and regulations of the
FDA.  Acquiree has not been informed by the FDA that the FDA
will prohibit the marketing, sale, license or use in the United
States of any product proposed to be developed, produced or
marketed by Acquiree nor has the FDA expressed any concern as to
approving or clearing for marketing any product being developed or
proposed to be developed by Acquiree.


 



 

11







 






 


Section 4.12 Intellectual Property.
Acquiree’s intellectual property is set forth on Schedule
4.12. From the date of this Agreement, Acquiree shall maintain in
full force and effect its corporate existence, rights and
franchises and all licenses and other rights to use intellectual
property owned or possessed by it and reasonably deemed to be
necessary to the conduct of its business, unless it is sold for
value.

 



ARTICLE V



REPRESENTATIONS AND WARRANTIES OF THE ACQUIROR AND



THE ACQUIROR PRINCIPAL SHAREHOLDERS


 


The
Acquiror and the Acquiror Principal Shareholders, jointly and
severally, hereby represent and warrant to the Acquiree, and each
of the Acquiree Principal Shareholders, subject to the exceptions
and qualifications specifically set forth or disclosed in writing
in the disclosure schedule delivered by each of the Acquiror
Principal Shareholders to the Acquiree, and the Acquiree Principal
Shareholders simultaneously herewith (the “Acquiror Disclosure Schedule”),
that the statements contained in this Article V are correct and
complete as of the date of this Agreement and will be correct and
complete as of the Closing Date (as though made then and as thought
the Closing Date were substituted for the date of this Agreement
throughout this Article
V) (except where another date or period of time is
specifically stated herein for a representation or warranty). The
Acquiror Disclosure Schedule shall be arranged according to the
numbered and lettered paragraphs of this Article V and any disclosure in
the Acquiror Disclosure Schedule shall qualify the corresponding
paragraph in this Article
V. The Acquiree, the Acquiree Principal Shareholders and,
after the Closing, the Acquiror, shall be entitled to rely on the
representations and warranties set forth in this Article V regardless of any
investigation or review conducted by the Acquiree, or the Acquiree
Principal Shareholders prior to the Closing.


 


Section
5.1     Organization and
Qualification. The Acquiror is
a corporation duly organized, validly existing and in good standing
under the Laws of the jurisdiction of its incorporation or
organization, has all requisite corporate authority and power,
Licenses, authorizations, consents and approvals to carry on its
business as presently conducted and to own, hold and operate its
properties and assets as now owned, held and operated by it, and is
duly qualified to do business and in good standing in each
jurisdiction in which the failure to be so qualified would not
reasonably be expected, individually or in the aggregate, to have a
Material Adverse Effect on the Acquiror.


 


Section
5.2     Authority. The Acquiror and the
Acquiror Principal Shareholders have all requisite authority and
power, Licenses, authorizations, consents and approvals to enter
into and deliver this Agreement and any of the other Transaction
Documents to which the Acquiror, the Acquiror Principal
Shareholders or any of them is a party and any other certificate,
agreement, document or instrument to be executed and delivered by
the Acquiror, the Acquiror Principal Shareholders or any of them in
connection with the transactions contemplated hereby and thereby
and to perform their respective obligations hereunder and
thereunder and to consummate the transactions contemplated hereby
and thereby. The execution and delivery of this Agreement and the
other Transaction Documents by the Acquiror and the Acquiror
Principal Shareholders and the performance by the Acquiror and the
Acquiror Principal Shareholders of their respective obligations
hereunder and thereunder and the consummation by the Acquiror and
the Acquiror Principal Shareholders of the transactions
contemplated hereby and thereby have been duly authorized by all
necessary action on the part of the Acquiror and the Acquiror
Principal Shareholders. The Acquiror does not need to give any
notice to, make any filing with, or obtain any authorization,
consent or approval of any Governmental Authority in order for the
Parties to execute, deliver or perform this Agreement or the
transactions contemplated hereby. This Agreement has been, and each
of the Transaction Documents to which the Acquiror, the Acquiror
Principal Shareholders or any of them, as applicable, are a party
will be, duly and validly authorized and approved, executed and
delivered by the Acquiror and each of the Acquiror Principal
Shareholders.


 



 

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Section
5.3     Binding
Obligations. Assuming this
Agreement and the Transaction Documents have been duly and validly
authorized, executed and delivered by the parties hereto and
thereto other than the Acquiror and the Acquiror Principal
Shareholders, this Agreement and each of the Transaction Documents
to which the Acquiror, the Acquiror Principal Shareholders or any
of them, as applicable, are a party are duly authorized, executed
and delivered by the Acquiror and such Acquiror Principal
Shareholders, as applicable, and constitutes the legal, valid and
binding obligations of the Acquiror and such Acquiror Principal
Shareholders, as applicable, enforceable against the Acquiror and
such Acquiror Principal Shareholders, as applicable, in accordance
with their respective terms, except as such enforcement is limited
by general equitable principles, or by bankruptcy, insolvency and
other similar Laws affecting the enforcement of creditors rights
generally.


 


Section
5.4     No
Conflicts. Neither the
execution nor the delivery by the Acquiror or the Acquiror
Principal Shareholders of this Agreement or any Transaction
Document to which the Acquiror, the Acquiror Principal Shareholders
or any of them is a party, nor the consummation or performance by
the Acquiror and the Acquiror Principal Shareholders of the
transactions contemplated hereby or thereby will, directly or
indirectly, (a) contravene, conflict with, or result in a violation
of any provision of the Acquiror Organizational Documents, (b)
contravene, conflict with or result in a violation of any Law,
Order, charge or other restriction or decree of any Governmental
Authority or any rule or regulation of the Principal Market
applicable to the Acquiror or the Acquiror Principal Shareholders,
or by which the Acquiror or the Acquiror Principal Shareholders or
any of their respective assets and properties are bound or
affected, (c) contravene, conflict with, result in any breach of,
or constitute a default (or an event that with notice or lapse of
time or both would become a default) under, impair the rights of
the Acquiror under, or alter the obligations of any Person under,
or create in any Person the right to terminate, amend, accelerate
or cancel, or require any notice, report or other filing (whether
with a Governmental Authority or any other Person) pursuant to, or
result in the creation of a Lien on any of the assets or properties
of the Acquiror under, any note, bond, mortgage, indenture,
Contract, License, permit, franchise or other instrument or
obligation to which the Acquiror or the Acquiror Principal
Shareholders is a party or by which the Acquiror or the Acquiror
Principal Shareholders or any of their respective assets and
properties are bound or affected; or (d) contravene, conflict with,
or result in a violation of, the terms or requirements of, or give
any Governmental Authority the right to revoke, withdraw, suspend,
cancel, terminate or modify, any Licenses, permits, authorizations,
approvals, franchises or other rights held by the Acquiror or that
otherwise relate to the business of, or any of the properties or
assets owned or used by, the Acquiror, except, in the case of
clauses (b), (c), or (d), for any such contraventions, conflicts,
violations, or other occurrences as would not have a Material
Adverse Effect on the Acquiror.


 


Section
5.5     Subsidiaries.
Except as set forth on Schedule
5.5, the Acquiror does not own,
directly or indirectly, any equity or other ownership interest in
any corporation, partnership, joint venture or other entity or
enterprise. There are no Contracts or other obligations (contingent
or otherwise) of the Acquiror to retire, repurchase, redeem or
otherwise acquire any outstanding shares of capital stock of, or
other ownership interests in, any other Person or to provide funds
to or make any investment (in the form of a loan, capital
contribution or otherwise) in any other Person.


 


Section
5.6     Organizational
Documents/Capitalization. The Acquiror has delivered or made
available to Acquiree a true and correct copy of the Certificate of
Incorporation and Bylaws of the Acquiror and any other
organizational documents of the Acquiror, each as amended, and each
such instrument is in full force and effect (the “Acquiror
Organizational Documents”). The Acquiror is not in violation
of any of the provisions of its Acquiror Organizational Documents.
The authorized capital stock of the Acquiror consists of (i)
15,000,000,000 shares of Acquiror Common Stock, $0.0001 par value
per share, of which 3,000,000 shares of Acquiror Common Stock will
be issued and outstanding as of the Closing Date; (ii) 50,000,000
shares of preferred stock, $0.0001 par value per share, of which
one share of Series A Preferred Stock will be issued and
outstanding as of the Closing Date. Except as set forth above, no
shares of capital stock or other voting securities of the Acquiror
were issued, reserved for issuance or outstanding. All outstanding
shares of the capital stock of the Acquiror are, and all such
shares that may be issued prior to the Closing Date will be when
issued, duly authorized, validly issued, fully paid and
nonassessable and not subject to or issued in violation of any
purchase option, call option, right of first refusal, preemptive
right, subscription right or any similar right under any provision
of the Laws of the jurisdiction of the Acquiror’s
organization, the Acquiror Organizational Documents or any Contract
to which the Acquiror is a party or otherwise bound. Except as set
forth on Schedule 5.6(a), there are not any bonds, debentures,
notes or other Indebtedness of the Acquiror having the right to
vote (or convertible into, or exchangeable for, securities having
the right to vote) on any matters on which holders of Acquiror
Common Stock may vote. Except as set forth on Schedule 5.6(a), there are no
options, warrants, rights, convertible or exchangeable securities,
“phantom” stock rights, stock appreciation rights,
stock-based performance units, commitments, Contracts, arrangements
or undertakings of any kind to which the Acquiror is a party or by
which it is bound (x) obligating the Acquiror to issue, deliver or
sell, or cause to be issued, delivered or sold, additional shares
of capital stock or other equity interests in, or any security
convertible or exercisable for or exchangeable into any capital
stock of or other equity interest in, the Acquiror, (y) obligating
the Acquiror to issue, grant, extend or enter into any such option,
warrant, call, right, security, commitment, Contract, arrangement
or undertaking or (z) that give any Person the right to receive any
economic benefit or right similar to or derived from the economic
benefits and rights occurring to holders of the capital stock of
the Acquiror. Except as set forth on Schedule 5.6(a), there are no
outstanding Contracts or obligations of the Acquiror to repurchase,
redeem or otherwise acquire any shares of capital stock of the
Acquiror. There are no registration rights, proxies, voting trust
agreements or other agreements or understandings with respect to
any class or series of any capital stock or other security of the
Acquiror. The stockholder list provided to the Acquiree and the
Acquiree Principal Shareholders is a current stockholder list
generated by its stock transfer agent, and such list accurately
reflects all of the issued and outstanding shares of the Acquiror
Common Stock.


 



 

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(b)     The
issuance of the Acquiror Shares to the Acquiree Principal
Shareholders has been duly authorized and, upon delivery to the
Acquiree Principal Shareholders of certificates therefor,
respectively, in accordance with the terms of this Agreement, the
Acquiror Shares, will have been validly issued and fully paid, and
will be nonassessable, have the rights, preferences and privileges
specified, will be free of preemptive rights and will be free and
clear of all Liens and restrictions, other than Liens created by
the Acquiree Principal Shareholders, and restrictions on transfer
imposed by this Agreement and the Securities Act.


 


Section
5.7     Compliance with
Laws. The business and
operations of the Acquiror have been and are being conducted in
accordance with all applicable Laws and Orders. Except as set forth
in Schedule
5.7, the Acquiror is not in
conflict with, or in default or violation of and, to the Knowledge
of the Acquiror or the Acquiror Principal Shareholders, is not
under investigation with respect to and has not been threatened to
be charged with or given notice of any violation of or default
under, any (i) Law, rule, regulation, judgment or Order, or (ii)
note, bond, mortgage, indenture, Contract, License, permit,
franchise or other instrument or obligation to which the Acquiror
or the Acquiror Principal Shareholders are parties or by which the
Acquiror or the Acquiror Principal Shareholders or any of their
respective assets and properties are bound or affected. There is no
agreement, judgment or Order binding upon the Acquiror or the
Acquiror Principal Shareholders which has, or could reasonably be
expected to have, the effect of prohibiting or materially impairing
any business practice of the Acquiror or the conduct of business by
the Acquiror as currently conducted or the consummation of the
transactions contemplated hereby. The Acquiror has filed all forms,
reports and documents required to be filed with any Governmental
Authority and the Acquiror has made available such forms, reports
and documents to Acquiree and the Acquiree Principal Shareholders.
As of their respective dates, such forms, reports and documents
complied in all material respects with the applicable requirements
pertaining thereto and none of such forms, reports and documents
contain any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary in order
to make the statements therein, in the light of the circumstances
under which they were made, not misleading.


 


Section
5.8     Certain Proceedings.
 There is no Action
pending against, or to the Knowledge of the Acquiror or the
Acquiror Principal Shareholders, threatened against or affecting,
the Acquiror or the Acquiror Principal Shareholders by any
Governmental Authority or other Person with respect to the Acquiror
or its respective businesses or that challenges, or may have the
effect of preventing, delaying, making illegal, or otherwise
interfering with, any of the transactions contemplated by this
Agreement. The Acquiror is not in violation of and, to the
Knowledge of Acquiror or the Acquiror Principal Shareholders, is
not under investigation with respect to and has not been threatened
to be charged with or given notice of any violation of, any
applicable Law, rule, regulation, judgment or Order. The Acquiror
or any director or officer (in his or her capacity as such) of the
Acquiror, is or has not been the subject of any Action involving a
claim or violation of or liability under federal or state
securities laws or a claim of breach of fiduciary duty. There are
no outstanding SEC comments on any SEC or other regulatory filing
made by the Parent that remain outstanding.


 



 

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Section
5.9     No Brokers or
Finders. No Person has, or as a
result of the transactions contemplated herein will have, any right
or valid claim against the Acquiror, or the Acquiror Principal
Shareholders for any commission, fee or other compensation as a
finder or broker, or in any similar capacity, based upon
arrangements made by or on behalf of the Acquiror, or the Acquiror
Principal Shareholders, and the Acquiror Principal Shareholders
will indemnify and hold the Acquiror, the Acquiree and the Acquiree
Principal Shareholders harmless against any liability or expense
arising out of, or in connection with, any such
claim.


 


Section
5.10     Contracts.
Except as disclosed in the SEC Reports, there are no Contracts that
are material to the business, properties, assets, condition
(financial or otherwise), results of operations or prospects of the
Acquiror. The Acquiror is not in violation of or in default under
(nor does there exist any condition which upon the passage of time
or the giving of notice would cause such a violation of or default
under) any Contract to which it is a party or to which it or any of
its properties or assets is subject, except for violations or
defaults that would not, individually or in the aggregate,
reasonably be expected to result in a Material Adverse Effect of
the Acquiror.


 


Section
5.11     Tax
Matters. Tax Returns. The
Acquiror has filed all Tax Returns required to be filed (if any) by
or on behalf of the Acquiror, as applicable, and has paid all Taxes
of the Acquiror, as applicable, required to have been paid (whether
or not reflected on any Tax Return). No Governmental Authority in
any jurisdiction has made a claim, assertion or threat to the
Acquiror that the Acquiror is or may be subject to taxation by such
jurisdiction; there are no Liens with respect to Taxes on the
Acquiror’s property or assets; and there are no Tax rulings,
requests for rulings, or closing agreements relating to the
Acquiror for any period (or portion of a period) that would affect
any period after the date hereof.


 


(b)     No
Adjustments, Changes. Neither the Acquiror nor any other
Person on behalf of the Acquiror (a) has executed or entered into a
closing agreement pursuant to Section 7121 of the Code or any
predecessor provision thereof or any similar provision of state,
local or foreign law; or (b) has agreed to or is required to make
any adjustments pursuant to Section 481(a) of the Code or any
similar provision of state, local or foreign law.


 


(c)     No
Disputes. There is no pending audit, examination,
investigation, dispute, proceeding or claim with respect to any
Taxes of the Acquiror, nor is any such claim or dispute pending or
contemplated. The Acquiror has delivered to the Acquiree true,
correct and complete copies of all Tax Returns and examination
reports and statements of deficiencies assessed or asserted against
or agreed to by the Acquiror, if any, since its inception and any
and all correspondence with respect to the foregoing.


 


(d)     Not
a U.S. Real Property Holding Corporation. The Acquiror is
not and has never been a U.S. real property holding corporation
within the meaning of Section 897(c)(2) of the Code at any time
during the applicable period specified in Section 897(c)(1)(A)(ii)
of the Code.


 


(e)     No
Tax Allocation, Sharing. The Acquiror is not and has never
been a party to any Tax allocation or sharing
agreement.


 


(f)     No
Other Arrangements. Except as disclosed in the SEC Reports,
the Acquiror is not a party to any Contract or arrangement for
services that would result, individually or in the aggregate, in
the payment of any amount that would not be deductible by reason of
Section 162(m), 280G or 404 of the Code. The Acquiror is not a
“consenting corporation” within the meaning of Section
341(f) of the Code. The Acquiror does not have any
“tax-exempt bond financed property” or
“tax-exempt use property” within the meaning of Section
168(g) or (h), respectively of the Code. The Acquiror does not have
any outstanding closing agreement, ruling request, request for
consent to change a method of accounting, subpoena or request for
information to or from a Governmental Authority in connection with
any Tax matter. During the last two years, the Acquiror has not
engaged in any exchange with a related party (within the meaning of
Section 1031(f) of the Code) under which gain realized was not
recognized by reason of Section 1031 of the Code. The Acquiror is
not a party to any reportable transaction within the meaning of
Treasury Regulation Section 1.6011-4.


 



 

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Section 5.12    Labor
Matters.    There are no collective bargaining
or other labor union agreements to which the Acquiror is a party or
by which it is bound. No material labor dispute exists or, to the
Knowledge of the Acquiror, is imminent with respect to any of the
employees of the Acquiror.


 


(b)     Except
as set forth in Section 5.13, the Acquiror does not have any
employees, independent contractors or other Persons providing
services to them. The Acquiror is in full compliance with all Laws
regarding employment, wages, hours, benefits, equal opportunity,
collective bargaining, the payment of Social Security and other
taxes, and occupational safety and health. The Acquiror is not
liable for the payment of any compensation, damages, taxes, fines,
penalties or other amounts, however designated, for failure to
comply with any of the foregoing Laws.


 


(c)     No
director, officer or employee of the Acquiror is a party to, or is
otherwise bound by, any Contract (including any confidentiality,
non-competition or proprietary rights agreement) with any other
Person that in any way adversely affects or will materially affect
(a) the performance of his or her duties as a director, officer or
employee of the Acquiror or (b) the ability of the Acquiror to
conduct its business. Each employee of the Acquiror is employed on
an at-will basis and the Acquiror does not have any Contract with
any of its employees which would interfere with its ability to
discharge its employees.


 


Section
5.13     Employee
Benefits.     Except as set forth
on Schedule
5.13, the Acquiror has not
maintained or contributed to any bonus, pension, profit sharing,
deferred compensation, incentive compensation, stock ownership,
stock purchase, stock option, phantom stock, retirement, vacation,
severance, disability, death benefit, hospitalization, medical or
other plan, arrangement or understanding (whether or not legally
binding) providing benefits to any current or former employee,
officer or director of the Acquiror. There are no employment,
consulting, indemnification, severance or termination agreements or
arrangements between the Acquiror and any current or former
employee, officer or director of the Acquiror, nor does the
Acquiror have any general severance plan or
policy.


 


(b)     The
Acquiror has not maintained or contributed to any “employee
pension benefit plans” (as defined in Section 3(2) of ERISA),
“employee welfare benefit plans” (as defined in Section
3(1) of ERISA) or any other benefit plan for the benefit of any
current or former employees, consultants, officers or directors of
the Acquiror.


 


Section
5.14     Title to
Assets.  Except as
set forth on Schedule
5.14, the Acquiror does not own
any real property. The Acquiror has sufficient title to, or valid
leasehold interests in, all of its properties and assets used in
the conduct of its businesses. All such assets and properties,
other than assets and properties in which the Acquiror has
leasehold interests, are free and clear of all Liens, except for
Liens that, in the aggregate, do not and will not materially
interfere with the ability of the Acquiror to conduct business as
currently conducted.


 


Section
5.15     Intellectual
Property. The Acquiror’s
Intellectual Property is set forth on Schedule
5.15.


 


Section 5.16    SEC
Reports.    The Acquiror has filed
all reports, schedules, forms, statements and other documents
required to be filed by it with the SEC since January 1, 2017,
pursuant to the Exchange Act (the “SEC
Reports”).


 


(b)     As
of their respective dates, the SEC Reports and any registration
statements filed by the Acquiror under the Securities Act (the
“Registration
Statements”) complied in all material respects with
the requirements of the Exchange Act and the Securities Act, as
applicable, and the rules and regulations of the SEC promulgated
thereunder, and none of the SEC Reports or Registration Statements,
when filed, contained any untrue statement of a material fact or
omitted to state a material fact required to be stated therein or
necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading. The
financial statements of the Acquiror included in the SEC Reports
and the Registration Statements comply in all respects with
applicable accounting requirements and the rules and regulations of
the SEC with respect thereto as in effect at the time of filing,
were prepared in accordance with GAAP applied on a consistent basis
during the periods involved (except as may be indicated in the
notes thereto, or, in the case of unaudited statements as permitted
by Form 10-Q), and fairly present in all material respects (subject
in the case of unaudited statements, to normal, recurring audit
adjustments) the financial position of the Acquiror as at the dates
thereof and the results of its operations and cash flows for the
periods then ended. The disclosure set forth in the SEC Reports and
Registration Statements regarding the Acquiror’s business is
current and complete and accurately reflects operations of the
Acquiror as it exists as of the date hereof.


 



 

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Section 5.17    Internal Accounting
Controls. As set forth in the
SEC Reports, the Acquiror maintains a system of internal accounting
controls sufficient to provide reasonable assurance that (a)
transactions are executed in accordance with management’s
general or specific authorizations, (b) transactions are recorded
as necessary to permit preparation of financial statements in
conformity with generally accepted accounting principles and to
maintain asset accountability, (c) access to assets is permitted
only in accordance with management’s general or specific
authorization, and (d) the recorded accountability for assets is
compared with the existing assets at reasonable intervals and
appropriate action is taken with respect to any differences. As set
forth in the SEC Reports, the Acquiror has established disclosure
controls and procedures for the Acquiror and designed such
disclosure controls and procedures to ensure that material
information relating to the Acquiror is made known to the officers
by others within the Acquiror. As set forth in the SEC Reports, the
Acquiror’s officers have evaluated the effectiveness of the
Acquiror’s controls and procedures. Since the Acquiror Most
Recent Fiscal Year End, there have been no significant changes in
the Acquiror’s internal controls or, to the Knowledge of the
Acquiror or the Acquiror Principal Shareholders, in other factors
that could significantly affect the Acquiror’s internal
controls.


 


Section 5.18    Application of
Takeover Protections. The
Acquiror has taken all necessary action, if any, in order to render
inapplicable any control share acquisition, business combination,
poison pill (including any distribution under a rights agreement)
or other similar anti-takeover provision under the Acquiror
Organizational Documents or the Laws of its state of incorporation
that is or could become applicable to the transactions contemplated
hereby.


 


Section 5.19    Transactions With
Affiliates and Employees.
Except as disclosed in the SEC Reports, no officer, director,
employee or stockholder of the Acquiror or any Affiliate of any
such Person, has or has had, either directly or indirectly, an
interest in any transaction with the Acquiror (other than for
services as employees, officers and directors), including any
Contract or other arrangement providing for the furnishing of
services to or by, providing for rental of real or personal
property to or from, or otherwise requiring payments to or from any
such Person or, to the Knowledge of the Acquiror or the Acquiror
Principal Shareholders, any entity in which any such Person has an
interest or is an officer, director, trustee or
partner.


 


Section 5.20    Liabilities.
Except as set forth in the SEC Reports, the Acquiror does not have
any Liability (and there is no Action pending, or to the Knowledge
of the Acquiror or the Acquiror Principal Shareholders, threatened
against the Acquiror that would reasonably be expected to give rise
to any Liability). The Acquiror is not a guarantor nor is it
otherwise liable for any Liability or obligation (including
Indebtedness) of any other Person. There are no financial or
contractual obligations of the Acquiror (including any obligations
to issue capital stock or other securities) executory after the
Closing Date. Except for the liabilities listed on
Schedule
5.20, all Liabilities of the
Acquiror shall have been paid off at or prior to the Closing and
shall in no event remain Liabilities of the Acquiror, the Acquiree
or the Acquiree Principal Shareholders following the
Closing.


 


Section 5.21    Bank Accounts and Safe
Deposit Boxes. The Acquiror has
several bank accounts which will be closed on or prior to the
Closing.


 


Section 5.22    Investment
Company. Neither the Acquiror
nor its affiliate, immediately following the Closing, will become,
an “investment company” within the meaning of the
Investment Company Act of 1940, as amended.


 



 

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Section 5.23    Bank Holding Company
Act. The Acquiror is not
subject to the Bank Holding Company Act of 1956, as amended (the
“BHCA”) and to regulation by the Board of Governors of
the Federal Reserve System (the “Federal Reserve”).
Neither the Acquiror nor any of its Affiliates owns or controls,
directly or indirectly, five percent (5%) or more of the
outstanding shares of any class of voting securities or twenty-five
percent (25%) or more of the total equity of a bank or any equity
that is subject to the BHCA and to regulation by the Federal
Reserve. Neither the Acquiror nor any of its Affiliates exercises a
controlling influence over the management or policies of a bank or
any entity that is subject to the BHCA and to regulation by the
Federal Reserve.


 


Section 5.24    Public Utility Holding
Act. The Acquiror is not a
“holding company,” or an “affiliate” of a
“holding company,” as such terms are defined in the
Public Utility Holding Act of 2005.


 


Section 5.25    Federal Power
Act. The Acquiror is not
subject to regulation as a “public utility” under the
Federal Power Act, as amended.


 


Section 5.26    Money Laundering
Laws. The operations of the
Acquiror is and has been conducted at all times in compliance with
applicable financial recordkeeping and reporting requirements of
the Currency and Foreign Transactions Reporting Act of 1970, as
amended, the money laundering statutes of all U.S. and non-U.S.
jurisdictions, the rules and regulations thereunder and any related
or similar rules, regulations or guidelines, issued, administered
or enforced by any Governmental Authority (collectively, the
“Money Laundering Laws”) and no Proceeding involving
the Acquiror with respect to the Money Laundering Laws is pending
or, to the knowledge of the Acquiror,
threatened.


 


Section 5.27    Foreign Corrupt
Practices. The Acquiror, nor,
to the Knowledge of the Acquiror or the Acquiror Principal
Shareholders, any director, officer, agent, employee or other
Person acting on behalf of the Acquiror has, in the course of its
actions for, or on behalf of, the Acquiror (a) used any corporate
funds for any unlawful contribution, gift, entertainment or other
unlawful expenses relating to political activity; (b) made any
direct or indirect unlawful payment to any foreign or domestic
government official or employee from corporate funds; (c) violated
or is in violation of any provision of the U.S. Foreign Corrupt
Practices Act of 1977, as amended; or (d) made any unlawful bribe,
rebate, payoff, influence payment, kickback or other unlawful
payment to any foreign or domestic government official or
employee.


 


Section 5.28    Absence of Certain
Changes or Events. Except as
set forth in the SEC Reports, for the last two fiscal years and
since the Acquiror’s Most Recent Fiscal Year End (a) the
Acquiror has conducted its business only in Ordinary Course of
Business; (b) there has not been any change in the assets,
Liabilities, financial condition or operating results of the
Acquiror, except changes in the Ordinary Course of Business that
have not caused, in the aggregate, a Material Adverse Effect on the
Acquiror; and (c) the Acquiror has not completed or undertaken any
of the actions set forth in Section
5.2. The Acquiror has not taken
any steps to seek protection pursuant to any Law or statute
relating to bankruptcy, insolvency, reorganization, receivership,
liquidation or winding up, nor does the Acquiror have any Knowledge
or reason to believe that any of its respective creditors intend to
initiate involuntary bankruptcy proceedings or any actual knowledge
of any fact which would reasonably lead a creditor to do
so.


 


Section 5.29    Disclosure.
All documents and other papers delivered or made available by or on
behalf of the Acquiror or the Acquiror Principal Shareholders in
connection with this Agreement are true, complete, correct and
authentic in all material respects. No representation or warranty
of the Acquiror or the Acquiror Principal Shareholders contained in
this Agreement and no statement or disclosure made by or on behalf
of the Acquiror or the Acquiror Principal Shareholders to the
Acquiree or any Acquiree Principal Shareholders pursuant to this
Agreement or any other agreement contemplated herein contains an
untrue statement of a material fact or omits to state a material
fact necessary to make the statements contained herein or therein
not misleading.


 


Section 5.30   
Undisclosed Events.
Except for the Spinoff Separation Agreement and the S-1
Registration Statement, no event, Liability, development or
circumstance has occurred or exists, or is contemplated to occur
with respect to the Acquiror, or its businesses, properties,
prospects, operations or financial condition, that would be
required to be disclosed by the Acquiror under applicable
securities laws on a registration statement on Form S-1 filed with
the SEC relating to an issuance and sale by the Acquiror of its
common stock and which has not been publicly announced or will not
be publicly announced in a current report on Form 8-K filed by the
Acquiror filed within four (4) Business Days after the
Closing.


 



 

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Section 5.31    Non-Public
Information. Neither the
Acquiror nor any Person acting on its behalf has provided the
Acquiree or Acquiree Principal Shareholders or their respective
agents or counsel with any information that the Acquiror or the
believes constitutes material, non-public information except
insofar as the existence and terms of the proposed transactions
hereunder may constitute such information and except for
information that will be disclosed by the Acquiror in a current
report on Form 8-K filed by the Acquiror within four (4) Business
Days after the Closing.


 


Section 5.32    Listing and
Maintenance Requirements. Acquiror Common Stock is currently quoted on
FINRA’s Over-the-Counter Markets (“OTC”) under
the symbol (“FDBL”) and Acquiror has not, in the 24
months preceding the date hereof, received any notice from the OTC
or FINRA or any trading market on which Acquiror Common Stock is or
has been listed or quoted to the effect that Acquiror is not in
compliance with the quoting, listing or maintenance requirements of
the OTC or such other trading market. Acquiror is, and has no
reason to believe that it will not, in the foreseeable future
continue to be, in compliance with all such quoting, listing and
maintenance requirements.


 


Section 5.33    No Integrated
Offering. To the Knowledge of
Acquiror and the Acquiror Principal Stockholders, and assuming the
accuracy of the Acquiree Principal Shareholders’
representations and warranties, neither the Acquiror , nor any of
its Affiliates, nor any Person acting on its or their behalf has,
directly or indirectly, made any offers or sales of any security or
solicited any offers to buy any security, under circumstances that
would cause this offering of the Acquiror Shares to be integrated
with prior offerings by Acquiror for purposes of (i) the Securities
Act which would require the registration of any such securities
under the Securities Act, or (ii) any applicable shareholder
approval provisions of any Trading Market on which any of the
securities of Acquiror are listed or
designated.


 


Section 5.34    Accountants.
Acquiror ’s accounting firm is Manning Elliot. To the
Knowledge and belief of Acquiror and the Acquiror Principal
Stockholder, such accounting firm: (i) is a registered public
accounting firm as required by the Exchange Act and (ii) expressed
its opinion with respect to the financial statements included in
Acquiror ’s Annual Report for the year ended December 31,
2017.


 


Section 5.35    No Disagreements with
Accountants and Lawyers. To the
Knowledge of Acquiror and the Acquiror Principal Stockholders,
there are no disagreements of any kind, including but not limited
to any disagreements regarding fees owed for services rendered,
presently existing, or reasonably anticipated by Acquiror to arise,
between Acquiror and the accountants and lawyers formerly or
presently employed by Acquiror which could affect Acquiror ’s
ability to perform any of its obligations under this Agreement, and
Acquiror is current with respect to any fees owed to its
accountants and lawyers.


 


Section 5.36    No SEC or FINRA
Inquiries. To the Knowledge of
Acquiror and the Acquiror Principal Representative Stockholders,
neither Acquiror nor any of its present officers or directors is,
or has ever been, the subject of any formal or informal inquiry or
investigation by the SEC or FINRA.


 


Section 5.37    Filing Status. The
Acquiror is not now a “shell company” as defined in the
Act and the Exchange Act and has not been a shell company since at
least January 1, 2016.


 



ARTICLE VI



CONDUCT PRIOR TO CLOSING


 



 

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Section
6.1        Conduct of
Business. At all times during
the period commencing with the execution and delivery of this
Agreement and continuing until the earlier of the termination of
this Agreement pursuant to the terms hereof or the Closing, the
Acquiror Principal Shareholders shall, and shall cause the Acquiror
to, (a) carry on its business diligently and in the usual, regular
and Ordinary Course of Business, in substantially the same manner
as heretofore conducted and in compliance with all applicable Laws,
(b) pay or perform its material obligations when due, (c) use its
commercially reasonable efforts, consistent with past practices and
policies, to preserve intact its present business organization,
keep available the services of its present officers and employees
and preserve its relationships with customers, suppliers,
distributors, licensors, licensees and others with which it has
business dealings, and (d) keep its business and properties
substantially intact, including its present operations, physical
facilities and working conditions. In furtherance of the foregoing
and subject to applicable Law, the Acquiror shall confer with
Acquiree, as promptly as practicable, prior to taking any material
actions or making any material management decisions with respect to
the conduct of the business of the Acquiror.


 


Section
6.2     Restrictions on
Conduct of Business. Without
limiting the generality of the terms of Section 6.1
hereof, except (i) as required by the
terms of this Agreement, or (ii) to the extent that Acquiree shall
otherwise consent in writing, at all times during the period
commencing with the execution and delivery of this Agreement and
continuing until the earlier of the termination of this Agreement
pursuant to the terms hereof or the Closing, neither the Acquiror,
nor the Acquiror Principal Shareholders shall do any of the
following, or permit the Acquiror to do any of the
following:


 


(a)     except
as required by applicable Law, waive any stock repurchase rights,
accelerate, amend or change the period of exercisability of options
or restricted stock, or reprice options granted under any employee,
consultant or director stock plans or authorize cash payments in
exchange for any options granted under any of such
plans;


 


(b)     enter
into any partnership arrangements, joint development agreements or
strategic alliances, other than in the Ordinary Course of
Business;


 


(c)     (i)
increase the compensation or fringe benefits of, or pay any bonuses
or special awards to, any present or former director, officer,
stockholder or employee of the Acquiror or increase any fees to any
independent contractors, (ii) grant any severance or termination
pay to any present or former director, officer or employee of the
Acquiror, (iii) enter into, amend or terminate any employment
Contract, independent contractor agreement or collective bargaining
agreement, written or oral, or (iv) establish, adopt, enter into,
amend or terminate any bonus, profit sharing, incentive, severance,
or other plan, agreement, program, policy, trust, fund or other
arrangement that would be an employee benefit plan if it were in
existence as of the date of this Agreement, except as required by
applicable Law;


 


(d)     issue,
deliver, sell, authorize, pledge or otherwise encumber, or propose
any of the foregoing with respect to, any shares of capital stock
or any securities convertible into, or exercisable or exchangeable
for, shares of capital stock of the Acquiror, or subscriptions,
rights, warrants or options to acquire any shares of capital stock
or any securities convertible into, or exercisable or exchangeable
for, shares of capital stock of the Acquiror or enter into other
Contracts or commitments of any character obligating it to issue
any such shares of capital stock of the Acquiror, or securities
convertible into, or exercisable or exchangeable for, shares of
capital stock of the Acquiror;


 


(e)     cause,
permit or propose any amendments to any Acquiror Organizational
Documents, except as contemplated herein;


 


(f)     acquire
or agree to acquire by merging or consolidating with, or by
purchasing any equity interest in or a portion of the assets of, or
by any other manner, any business or any corporation, limited
liability company, general or limited partnership, joint venture,
association, business trust or other business enterprise or entity,
or otherwise acquire or agree to acquire any assets other than in
the Ordinary Course of Business;


 


(g)     adopt
a plan of merger, complete or partial liquidation, dissolution,
consolidation, restructuring, recapitalization or other
reorganization;


 



 

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(h)     except
as required by applicable Law, adopt or amend any employee benefit
plan or employee stock purchase or employee stock option plan, or
enter into any employment Contract or collective bargaining
agreement (other than offer letters and letter agreements entered
into in the Ordinary Course of Business with employees who are
terminable “at will”), pay any special bonus or special
remuneration to any director or employee other than in the Ordinary
Course of Business, or increase the salaries or wage rates or
fringe benefits (including rights to severance or indemnification)
of its officers;


 


(i)     except
in the Ordinary Course of Business, modify, amend or terminate any
Contract to which the Acquiror is a party, or waive, delay the
exercise of, release or assign any rights or claims
thereunder;


 


(j)      sell,
lease, license, mortgage or otherwise encumber or subject to any
Lien or otherwise dispose of any of its properties or assets,
except in the Ordinary Course of Business;


 


(k)     (i)
incur any Indebtedness or guarantee any such Indebtedness of
another Person, issue or sell any debt securities or warrants or
other rights to acquire any debt securities of the Acquiror,
guarantee any debt securities of another Person, enter into any
“keep well” or other agreement to maintain any
financial statement condition of another Person or enter into any
arrangement having the economic effect of any of the foregoing,
except for endorsements and guarantees for collection, short-term
borrowings and lease obligations, in each case incurred in the
Ordinary Course of Business, or (ii) make any loans, advances or
capital contributions to, or investment in, any other Person, other
than to the Acquiror;


 


(l)     
change any financial reporting or accounting principle, methods or
practices used by it unless otherwise required by applicable Law or
GAAP;


 


(m)     settle
or compromise any litigation (whether or not commenced prior to the
date of this Agreement);


 


(n)     
enter into any transaction with any of its directors, officers,
stockholders, or other Affiliates except as contemplated
herein;


 


(o)     make
any capital expenditure in excess of $50,000;


 


(p)     (i)
grant any license or sublicense of any rights under or with respect
to any Intellectual Property; (ii) dispose of or let lapse and
Intellectual Property, or any application for the foregoing, or any
license, permit or authorization to use any Intellectual Property
or (iii) amend, terminate any other Contract, license or permit to
which the Acquiror is a party;


 


(q)     make,
or permit to be made, without the prior written consent of Acquiree
any material Tax election which would affect the Acquiror;
or


 


(r)      
commit to or otherwise to take any of the actions described in this
Section
6.2.


 


Section 6.3    
Reporting
Costs. Until Closing, the
Acquiror and the Acquiror Principal Shareholders shall bear all
costs related to the day to day operations of the Acquiror.
However, from the date of execution and delivery of this Agreement
until the Closing, Acquiror and its Shareholders shall be
responsible for any and all costs related to SEC reporting, press
releases, transfer agents, filings with the state of Nevada, or any
other costs associated with the fulfillment of the obligations of
Acquiror and Acquiror Principal Shareholders to this Agreement in
order to consummate the transaction contemplated herein, but in no
event any personal costs, fees and expenses related to Acquiror and
Acquiror Principal Shareholders including but not limited to the
payment of any taxes, except for any actions related to the spin
off of 100% of Fan Pass, Inc. which shall be the sole
responsibility of the Acquiror Principal
Shareholders.


 



ARTICLE VII



ADDITIONAL AGREEMENTS


 



 

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Section
7.1     Access to
Information. The Acquiror shall
afford Acquiree, its accountants, counsel and other representatives
(including the Acquiree Principal Shareholders), reasonable access,
during normal business hours, to the properties, books, records and
personnel of the Acquiror at any time prior to the Closing in order
to enable Acquiree obtain all information concerning the business,
assets and properties, results of operations and personnel of the
Acquiror as Acquiree may reasonably request. No information
obtained in the foregoing investigation by Acquiree pursuant to
this Section 7.1
shall affect or be deemed to modify
any representation or warranty contained herein or the conditions
to the obligations of the Acquiror or the Acquiror Principal
Shareholders to consummate the transactions contemplated
hereby.


 


Section
7.2     Legal
Requirements. The Parties shall
take all reasonable actions necessary or desirable to comply
promptly with all legal requirements which may be imposed on them
with respect to the consummation of the transactions contemplated
by this Agreement (including, without limitation, furnishing all
information required in connection with approvals of or filings
with any Governmental Authority, and prompt resolution of any
litigation prompted hereby), and shall promptly cooperate with, and
furnish information to, the other Parties to the extent necessary
in connection with any such requirements imposed upon any of them
in connection with the consummation of the transactions
contemplated by this Agreement.


 


Section
7.3     Notification of
Certain Matters. Acquiree shall
give prompt notice to the Acquiror Principal Shareholders, and the
Acquiror Principal Shareholders shall give prompt notice to the
Acquiree, of the occurrence, or failure to occur, of any event,
which occurrence or failure to occur would be reasonably likely to
cause (i) any representation or warranty contained in this
Agreement to be untrue or inaccurate at the Closing, such that the
conditions set forth in Article X
hereof, as the case may be, would not
be satisfied or fulfilled as a result thereof, or (ii) any material
failure of any Acquiree, Acquiree Principal Shareholders, the
Acquiror or the Acquiror Principal Shareholders, as the case may
be, or of any officer, director, employee or agent thereof, to
comply with or satisfy any covenant, condition or agreement to be
complied with or satisfied by it under this Agreement.
Notwithstanding the foregoing, the delivery of any notice pursuant
to this Section 7.3
shall not limit or otherwise affect
the rights and remedies available hereunder to the Party receiving
such notice.


 



ARTICLE VIII



POST CLOSING COVENANTS


 


Section
8.1     General.
In case at any time after the Closing any further action is
necessary to carry out the purposes of this Agreement, each of the
Parties will take such further action (including the execution and
delivery of such further instruments and documents) as any other
Party reasonably may request.


 


Section
8.2     Litigation
Support. In the event and for
so long as any Party actively is contesting or defending against
any action, suit, proceeding, hearing, investigation, charge,
complaint, claim, or demand in connection with (i) any transaction
contemplated under this Agreement or (ii) any fact, situation,
circumstance, status, condition, activity, practice, plan,
occurrence, event, incident, action, failure to act, or transaction
that existed on or prior to the Closing Date involving the Acquiror
or Acquiree, each of the other Parties will cooperate with such
Party and such Party’s counsel in the contest or defense,
make available any personnel under their control, and provide such
testimony and access to their books and records as shall be
reasonably necessary in connection with the contest or defense, all
at the sole cost and expense of the contesting or defending Party,
except them if such actions related to any claim against the Parent
which arose prior to the Closing Date.


 


Section
8.3     Assistance with Post-Closing SEC
Reports and Inquiries. After the Closing Date, the Acquiror
Principal Shareholders shall use their reasonable best efforts to
provide such information available to them, including information,
filings, reports, financial statements or other circumstances of
the Acquiror occurring, reported or filed prior to the Closing, as
may be necessary or required for the preparation of the
post-Closing Date reports that the Acquiror is required to file
with the SEC the IRS, or filings required to address and resolve
matters as may relate to the period prior to the Closing and any
SEC comments relating thereto or any SEC inquiry thereof. Acquiror
Principal Shareholders shall bear no costs related to post-Closing
SEC Reports and inquiries or tax filings that occurred or accrued
after the Closing Date in connection with Acquiror and Acquiror
Principal Shareholders.


 



 

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Section
8.4     Public
Announcements. The Acquiror
shall file with the SEC a Form 8-K describing the material terms of
the transactions contemplated hereby as soon as practicable
following the Closing Date but in no event more than four (4)
business days following the Closing Date. Prior to the Closing
Date, the Parties shall consult with each other in issuing the Form
8-K, press releases or otherwise making public statements or
filings and other communications with the SEC or any regulatory
agency or stock market or trading facility with respect to the
transactions contemplated hereby and no Party shall issue any such
press release or otherwise make any such public statement, filings
or other communications without the prior written consent of the
other Parties, which consent shall not be unreasonably withheld or
delayed, except that no prior consent shall be required if such
disclosure is required by Law, in which case the disclosing Party
shall provide the other Parties with prior notice of no less than
three (3) calendar days, of such public statement, filing or other
communication and shall incorporate into such public statement,
filing or other communication the reasonable comments of the other
Parties.


 


Section 8.5    Spin Off
Agreement. On the Closing Date,
Acquiror will have entered into a Spin Off Separation Agreement in
the form annexed hereto as Exhibit B
with Fan Pass Inc. for the separation
and spin off of Fan Pass, Inc.


 


Section 8.6    Friendable Asset
Sale/Spinoff. Subsequent to the
Closing Date, Acquiror will enter into an Asset Purchase Agreement
and Intellectual Property Assignment and Bill of Sale with
Checkmate Mobile Inc. relating to sale of the Friendable name and
mobile dating application.


 



ARTICLE IX



CONDITIONS TO CLOSING


 


Section
9.1     Conditions to
Obligation of the Parties Generally. The Parties shall not be obligated to consummate
the transactions to be performed by each of them in connection with
the Closing if, on the Closing Date, (i) any Action shall be
pending or threatened before any Governmental Authority wherein an
Order or charge would (A) prevent consummation of any of the
transactions contemplated by this Agreement or (B) cause any of the
transactions contemplated by this Agreement to be rescinded
following consummation, (ii) any Law or Order which would have any
of the foregoing effects shall have been enacted or promulgated by
any Governmental Authority; or (iii) the Acquiree shall not have
received an audit report with respect to its most recently
completed fiscal year from an independent accounting firm that is
registered with the Public Company Accounting Oversight
Board.


 


Section
9.2     Conditions to
Obligation of the Acquiree Parties. The obligations of the Acquiree, and the
Acquiree Principal Shareholders to enter into and perform their
respective obligations under this Agreement are subject, at the
option of the Acquiree and the Acquiree Principal Shareholders, to
the fulfillment on or prior to the Closing Date of the following
conditions, any one or more of which may be waived by the Acquiree
and the Acquiree Principal Shareholders in
writing:


 


(a)     The
representations and warranties of the Acquiror and the Acquiror
Principal Shareholders set forth in this Agreement shall be true
and correct in all material respects as of the Closing Date (except
to the extent such representations and warranties are specifically
made as of a particular date, in which case such representations
and warranties shall be true and correct as of such
date);


 


(b)     The
Acquiror shall have performed and complied with all of their
covenants hereunder in all material respects through the Closing,
except to the extent that such covenants are qualified by terms
such as “material” and “Material Adverse
Effect,” in which case the Acquiror shall have performed and
complied with all of such covenants in all material respects
through the Closing;


 



 

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(c)     No
action, suit, or proceeding shall be pending or, to the Knowledge
of the Acquiror, threatened before any Governmental Authority
wherein an Order or charge would (A) affect adversely the right of
the Acquiree Principal Shareholders to own the Acquiror Shares or
to control the Acquiror, or (B) affect adversely the right of the
Acquiror to own its assets or to operate its business (and no such
Order or charge shall be in effect), nor shall any Law or Order
which would have any of the foregoing effects have been enacted or
promulgated by any Governmental Authority;


 


(d)     No
event, change or development shall exist or shall have occurred
since the Acquiror Most Recent Fiscal Year End that has had or is
reasonably likely to have a Material Adverse Effect on the
Acquiror;


 


(e)     All
consents, waivers, approvals, authorizations or Orders required to
be obtained, and all filings required to be made, by the Acquiror
for the authorization, execution and delivery of this Agreement and
the consummation by it of the transactions contemplated by this
Agreement, shall have been obtained and made by the Acquiror and
Acquiror shall have delivered proof of same to the Acquiree, the
Parent and Acquiree Principal Shareholders;


 


(f)     Acquiror
shall have filed all reports and other documents required to be
filed by it under the U.S. federal securities laws through the
Closing Date;


 


(g)     There
shall not be any outstanding obligation or Liability (whether
accrued, absolute, contingent, liquidated or otherwise, whether due
or to become due), except as set forth on Schedule 5.20 of
Acquiror’s Disclosure Schedule, of the Acquiror, whether or
not known to the Acquiror, as of the Closing;


 


(h)     Acquiror
shall have delivered to the Acquiree, and Acquiree Principal
Shareholders a certificate, dated the Closing Date, executed by an
officer of the Acquiror, certifying the satisfaction of the
conditions specified in Sections 9.2(a) through
9.2(l), inclusive,
relating to the Acquiror;


 


(i)     The
Acquiror Principal Shareholders shall have delivered to the
Acquiree, and Acquiree Principal Shareholders a certificate, dated
the Closing Date, executed by such Acquiror Principal Shareholders,
certifying the satisfaction of the conditions specified in
Section 9.2(a)
inclusive, relating to such Acquiror Principal
Shareholders;


 


(j)     Acquiror
shall have delivered to the Acquiree and the Acquiree Principal
Shareholders (i) a certificate evidencing the formation and good
standing of the Acquiror in its jurisdiction of formation issued by
the Secretary of State (or comparable office) of such jurisdiction
of formation as of a date within fifteen (15) days of the Closing
Date; and (ii) a certificate evidencing the Acquiror’s
qualification as a foreign corporation and good standing issued by
the Secretary of State (or comparable office) of each jurisdiction
in which the Acquiror conducts business and is required to so
qualify, as of a date within five (5) days of the Closing
Date;


 


(k)     Acquiror
shall have delivered to the Acquiree and the Acquiree Principal
Shareholders a certificate duly executed by the Secretary of the
Acquiror and dated as of the Closing Date, as to (i) the
resolutions as adopted by the Acquiror’s board of directors,
in a form reasonably acceptable to the Acquiree, approving this
Agreement and the Transaction Documents to which it is a party and
the transactions contemplated hereby and thereby; (ii) the Acquiror
Organizational Documents, each as in effect at the Closing; and
(iv) the incumbency of each authorized officer of the Acquiror
signing this Agreement and any other agreement or instrument
contemplated hereby to which the Acquiror is a party;


 


(l)     Acquiror
shall have delivered to the Acquiree and the Acquiree Principal
Shareholders a statement from the Acquiror’s transfer agent
regarding the number of issued and outstanding shares of Acquiror
Common Stock immediately before the Closing;


 


(m)     Acquiror
shall have delivered to the Acquiree and the Acquiree Principal
Shareholders such pay-off letters and releases relating to any
Liabilities of the Acquiror, provided, however, that no pay-off
letters and releases shall be delivered for the Liabilities set
forth on Schedule 5.20 of Acquiror’s Disclosure
Schedule;


 


(n)     Acquiror
shall have delivered to the Acquiree and the Acquiree Principal
Shareholders duly executed letters of resignation from all of the
directors and officers of the Acquiror, effective as of the
Closing;


 



 

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(o)     
Acquiror shall have delivered to the Acquiree and the Acquiree
Principal Shareholders resolutions of the Acquiror’s board of
directors (i) appointing Edgar Nouss to serve as Chief Executive
Officer; (ii) appointing John Price to serve as Chief Financial
Officer; (iii) appointing Alan Blackman to serve as Executive
Chairman of the Acquiror’s board of directors; and (iv)
nominating Alan Blackman, David Loewenstein, Tony Mulone and Soren
Christiansen to serve as members of the Acquiror’s board of
directors, effective as of the Closing;


 


(p)     Acquiree
and the Acquiree Principal Shareholders shall have completed their
legal, accounting and business due diligence of the Acquiror and
the results thereof shall be satisfactory to the Acquiree and the
Acquiree Principal Shareholders in their sole and absolute
discretion;


 


(q)     All
actions to be taken by the Acquiror and the Acquiror Principal
Shareholders in connection with consummation of the transactions
contemplated hereby and all certificates, opinions, instruments,
and other documents required to effect the transactions
contemplated hereby shall be reasonably satisfactory in form and
substance to the Acquiree and the Acquiree Principal
Shareholders;


 


(r)     certificates
representing the new shares of Acquiror Stock issued to the
Shareholders set forth on Exhibit A;


 


(s)
   On the Closing Date, Acquiror will have entered into
the Spinoff Separation Agreement for the transfer of Fan Pass, Inc.
and concurrent filing of the S-1 Registration Statement;
and


 


(t)    
Exchange of outstanding Notes of Acquiror as set forth on
Schedule 9.2(u) for
an aggregate of $1,500,000 (post-Closing) of Acquiree convertible
notes convertible at a conversion price equal to $1.25 per
share.


 


(u)
    The Acquiror shall have effected a reverse stock
split of its Common Stock so that there will be no more than
3,000,000 shares of its Common Stock outstanding on a fully diluted
basis prior to the issuance of the Acquiror Stock.


 


(v)
    The Acquiror shall have entered into agreements with
certain holders of its preferred stock exchanging such Preferred
Shares for shares of Common Stock which shall be included in the
15% of shares that will be owned by pre-existing shareholders of
the Acquiror at Closing and there shall be no other shares of
Preferred Stock outstanding.


 


(w)   
The Acquiror shall have received an executed leak-out agreement
from the Acquiror Principal Shareholders, EMA Financial LLC,
Coventry Enterprises LLC and Alpha Capital Anstalt in the forms
attached as Exhibit 9.2
(w).


 


(x)
    Alpha Capital Anstalt shall have purchased at least
$325,000 in two tranches of $162,500 each of Acquiree’s
common stock and/or preferred stock, if necessary, on the same
terms as the Acquiree’s second financing which shall be at a
price of $0.80 per share.


 


Section
9.3     Conditions to Obligation of the
Acquiror Parties.


 


The
obligations of the Acquiror and the Acquiror Principal Shareholders
to enter into and perform their respective obligations under this
Agreement are subject, at the option of the Acquiror and the
Acquiror Principal Shareholders, to the fulfillment on or prior to
the Closing Date of the following conditions, any one or more of
which may be waived by the Acquiror and the Acquiror Principal
Shareholders in writing:


 


(a)     The
representations and warranties of the Acquiree and the Acquiree
Principal Shareholders set forth in this Agreement shall be true
and correct in all material respects as of the Closing Date (except
to the extent such representations and warranties are specifically
made as of a particular date, in which case such representations
and warranties shall be true and correct as of such
date);


 


(b)     The
Acquiree and the Acquiree Principal Shareholders shall have
performed and complied with all of their covenants hereunder in all
material respects through the Closing, except to the extent that
such covenants are qualified by terms such as
“material” and “Material Adverse Effect,”
in which case the Acquiree and the Acquiree Principal Shareholders
shall have performed and complied with all of such covenants in all
respects through the Closing;


 



 

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(c)     All
consents, waivers, approvals, authorizations or Orders required to
be obtained, and all filings required to be made, by the Acquiror
for the authorization, execution and delivery of this Agreement and
the consummation by it of the transactions contemplated by this
Agreement, shall have been obtained and made by the Acquiree and
Acquiree shall have delivered proof of same to the Acquiror and
Acquiror Principal Shareholders;


 


(d)     Acquiree
shall have delivered to the Acquiror and Acquiror Principal
Shareholders a certificate, dated the Closing Date, executed by an
officer of the Acquiree, certifying the satisfaction of the
conditions specified in Sections 9.3(a) through
9.3(c), inclusive,
relating to the Acquiree;


 


(e)     Acquiree
shall have delivered to the Acquiror and the Acquiror Principal
Shareholders a certificate duly executed by the Secretary of the
Acquiree and dated as of the Closing Date, as to (i) the
resolutions as adopted by the Acquiree’s board of directors,
in a form reasonably acceptable to the Acquiror, approving this
Agreement and the Transaction Documents to which it is a party and
the transactions contemplated hereby and thereby; (ii) the Acquiree
Organizational Documents, each as in effect at the Closing; and
(iii) the incumbency of each authorized officer of the Acquiree
signing this Agreement and any other agreement or instrument
contemplated hereby to which the Acquiree is a party;


 


(f)     Acquiror
and the Acquiror Principal Shareholders shall have completed their
legal, accounting and business due diligence of the Acquiree and
the results thereof shall be satisfactory to the Acquiror and the
Acquiror Principal Shareholders in their sole and absolute
discretion; and


 


(g)     All
actions to be taken by the Acquiree and the Acquiree Principal
Shareholders in connection with consummation of the transactions
contemplated hereby and all payments, certificates, opinions,
instruments, and other documents required to effect the
transactions contemplated hereby shall be reasonably satisfactory
in form and substance to the Acquiror and the Acquiror Principal
Shareholders.


 



ARTICLE X



TERMINATION


 


Section
10.1     Grounds for
Termination. Anything herein or
elsewhere to the contrary notwithstanding, this Agreement may be
terminated and the transactions contemplated hereby may be
abandoned at any time prior to the Closing
Date:


 


(a)     by
the mutual written agreement of the Parties;


 


(b)     by
the Acquiror or the Acquiree (by written notice of termination from
such Party to the other Parties) if a Governmental Authority of
competent jurisdiction shall have issued a final non-appealable
Order, or shall have taken any other action having the effect of,
permanently restraining, enjoining or otherwise prohibiting the
consummation of the transactions contemplated hereby; provided,
however, that the right to terminate this Agreement under this
Section 10.1(b)
shall not be available to a Party if such Order was primarily due
to the failure of such Party to perform any of its obligations
under this Agreement;


 


(c)     by
the Acquiror, Acquiree or the Acquiree Principal Shareholders (by
written notice of termination from such Party to the other Parties)
if any event shall occur after the date hereof that shall have made
it impossible to satisfy a condition precedent to the terminating
Party’s obligations to perform its obligations hereunder,
unless the occurrence of such event shall be due to the failure of
the terminating Party to perform or comply with any of the
agreements, covenants or conditions hereof to be performed or
complied with by such Party at or prior to the
Closing;


 


(d)     by
Acquiree or the Acquiree Principal Shareholders (by written notice
of termination from Acquiree to the Acquiror Principal
Shareholders, in which reference is made to this subsection) if,
since the date of this Agreement, there shall have occurred any
Material Adverse Effect on the Acquiror, or there shall have
occurred any event or circumstance that, in combination with any
other events or circumstances, could reasonably be expected to
have, a Material Adverse Effect with respect to the
Acquiror;


 



 

26







 






 


(e)     by
the Acquiree (by written notice of termination from the Acquiree to
the Acquiror and the Acquiror Principal Shareholders, in which
reference is made to the specific provision(s) of this subsection
giving rise to the right of termination) if (i) any of
Acquiror’s or the Acquiror Shareholder’s
representations and warranties shall have been inaccurate as of the
date of this Agreement or as of a date subsequent to the date of
this Agreement (as if made on such subsequent date), such that the
condition set forth in Section 9.3(a) would not be
satisfied and such inaccuracy has not been cured by Acquiror or the
Acquiror Principal Shareholders within five (5) Business Days after
its receipt of written notice thereof and remains uncured at the
time notice of termination is given, (ii) any of the
Acquiror’s or Acquiror Principal Shareholders’s
covenants contained in this Agreement shall have been breached,
such that the condition set forth in Section 9.3(b) would not be
satisfied, or (iii) any Action shall be initiated, threatened or
pending which could reasonably be expected to materially and
adversely affect the Acquiror or Acquiree (including, without
limitation, any such Action relating to any alleged violation of,
or non-compliance with, any applicable Law or any allegation of
fraud or intentional misrepresentation); or


 


(f)     by
the Acquiror and the Acquiror Principal Shareholders (by written
notice of termination from the Acquiror to the Acquiree and the
Parent and the Acquiree Principal Shareholders, in which reference
is made to the specific provision(s) of this subsection giving rise
to the right of termination) if (i) any of Acquiree’s or the
Acquiree Principal Shareholder’s representations and
warranties shall have been inaccurate as of the date of this
Agreement or as of a date subsequent to the date of this Agreement
(as if made on such subsequent date) and such inaccuracy has not
been cured by Acquiree or the Acquiree Principal Shareholders
within five (5) Business Days after its receipt of written notice
thereof and remains uncured at the time notice of termination is
given, or (ii) any of the Acquiree’s or Acquiree Principal
Shareholder’s covenants contained in this Agreement shall
have been breached.


 


Section
10.2       Procedure and Effect
of Termination. In the event of
the termination of this Agreement by the Acquiror Principal
Shareholders or Acquiree pursuant to Section 10.1
hereof, written notice thereof shall
forthwith be given to the other Party. If this Agreement is
terminated as provided herein (a) each Party will redeliver all
documents, work papers and other material of any other Party
relating to the transactions contemplated hereby, whether so
obtained before or after the execution hereof, to the Party
furnishing the same; provided, that each Party may retain one copy
of all such documents for archival purposes in the custody of its
outside counsel and (b) all filings, applications and other
submission made by any Party to any Person, including any
Governmental Authority, in connection with the transactions
contemplated hereby shall, to the extent practicable, be withdrawn
by such Party from such Person.


 


Section
10.3       Effect of
Termination. If this Agreement
is terminated pursuant to Section 10.1
hereof, this Agreement shall become
void and of no further force and effect. Each Party shall be
responsible for their own fees and expenses incurred and there
shall be no liability on either Party to the
other.


 



ARTICLE XI



SURVIVAL; INDEMNIFICATION


 


Section
11.1       Indemnification.


 


(a)           Subject
to the provisions of this Article 11, the Acquiror Principal
Stockholders agrees to indemnify fully in respect of, hold harmless
and defend the Acquiree, the Acquiree Principal Stockholders, and
each of the officers, agents and directors of the Acquiree, against
any damages, liabilities, costs, claims, proceedings,
investigations, penalties, judgments, deficiencies, including
taxes, expenses (including, but not limited to, any and all
interest, penalties and expenses whatsoever reasonably incurred in
investigating, preparing or defending against any litigation,
commenced or threatened, or any claim whatsoever) and losses (each,
a “Claim” and collectively “Claims”) to
which it or they may become subject arising out of or based on
either (i) any breach of or inaccuracy in any of the
representations and warranties or covenants or conditions made by
Acquiror and/or the Acquiror Principal Stockholders herein in this
Agreement; or (ii) any and all liabilities arising out of or in
connection with: (A) any of the assets of Acquiror prior to the
Closing; or (B) the operations of Acquiror prior to the Closing,
including any liability based on a claim related to this
transaction, the Spin-off or any reverse stock split undertaken by
the Acquiror.


 



 

27







 






 


(b)           Subject
to the provisions of this Article 11, the Acquiree Principal
Stockholders agrees to indemnify fully in respect of, hold harmless
and defend the Acquiror, the Acquiror Principal Stockholders, and
each of the officers, agents and directors of the Acquiror, against
any damages, liabilities, costs, claims, proceedings,
investigations, penalties, judgments, deficiencies, including
taxes, expenses (including, but not limited to, any and all
interest, penalties and expenses whatsoever reasonably incurred in
investigating, preparing or defending against any litigation,
commenced or threatened, or any claim whatsoever) and losses (each,
a “Claim” and collectively “Claims”) to
which it or they may become subject arising out of or based on
either (i) any breach of or inaccuracy in any of the
representations and warranties or covenants or conditions made by
Acquiree and/or the Acquiree Principal Stockholders herein in this
Agreement; or (ii) any and all liabilities arising out of or in
connection with: (A) any of the assets of Acquiree prior to the
Closing; or (B) the operations of Acquiree prior to the Closing.
The indemnification of Barry Berler shall only be applicable to
Section 4.11.


 


Section
11.2       Survival of
Representations and Warranties.
Notwithstanding provision in this Agreement to the contrary, the
representations and warranties given or made hereunder shall
survive the date hereof for a period of twelve (12) months from and
after the Closing Date (the last day of such period is herein
referred to as the “Expiration Date”), except that any
written claim for breach thereof made and delivered prior to the
Expiration Date to the party against whom such indemnification is
sought shall survive thereafter and, as to any such claim, such
applicable expiration will not effect the rights to indemnification
of the party making such claim; provided, however, that any
representations and warranties that were fraudulently made shall
not expire on the Expiration Date and shall survive indefinitely
and claims with respect to fraud by Acquiror or the Acquiror
Principal Stockholders and by Acquiree or Acquiree Principal
Stockholders, respectively, must be made at any time, as long as
such claim is made within a reasonable period of time after
discovery by the claiming party.


 


Section
11.3       Method of Asserting
Claims, Etc. The party claiming
indemnification is hereinafter referred to as the
“Indemnified Party” and the party against whom such
claims are asserted hereunder is hereinafter referred to as the
“Indemnifying Party.” All Claims for indemnification by
any Indemnified Party under this Article 11 shall be asserted as
follows:


 


(a)           In
the event that any Claim or demand for which an Indemnifying Party
would be liable to an Indemnified Party hereunder is asserted
against or sought to be collected from such Indemnified Party by a
third party, said Indemnified Party shall, within ten (10) business
days from the date upon which the Indemnified Party has Knowledge
of such Claim, notify the Indemnifying Party of such claim or
demand, specifying the nature of and specific basis for such claim
or demand and the amount or the estimated amount thereof to the
extent then feasible (which estimate shall not be conclusive of the
final amount of such Claim or demand) (the “Claim
Notice”). The Indemnified Party’s failure to so notify
the Indemnifying Party in accordance with the provisions of this
Agreement shall not relieve the Indemnifying Party of liability
hereunder unless such failure materially prejudices the
Indemnifying Party’s ability to defend against the claim or
demand. The Indemnifying Party shall have 30 days from the giving
of the Claim Notice (the “Notice Period”) to notify the
Indemnified Party: (i) whether or not the Indemnifying Party
disputes the liability of the Indemnifying Party to the Indemnified
Party hereunder with respect to such Claim or demand, and (ii)
whether or not the Indemnifying Party desires, at the sole cost and
expense of the Indemnifying Party, to defend the Indemnified Party
against such Claims or demand; provided, however, that any
Indemnified Party is hereby authorized prior to and during the
Notice Period to file any motion, answer or other pleading which he
shall deem necessary or appropriate to protect his interests or
those of the Indemnifying Party and not prejudicial to the
Indemnifying Party. In the event that the Indemnifying Party
notifies the Indemnified Party within the Notice Period that he
does not dispute liability for indemnification under this Article
11 and that he desires to defend the Indemnified Party against such
claim or demand and except as hereinafter provided, the
Indemnifying Party shall have the right to defend by all
appropriate proceedings, which proceedings shall be promptly
settled or prosecuted by him to a final conclusion. The Indemnified
Party shall have the right to employ separate counsel in any such
action and participate in the defense thereof, but the fees and
expenses of such counsel shall be at the expense of such
Indemnified Party except to the extent that the employment thereof
has been specifically authorized by the Indemnifying Party in
writing, the Indemnifying Party has failed after a reasonable
period of time to assume such defense and to employ counsel or in
such action there is, in the reasonable opinion of such separate
counsel, a material conflict on any material issue between the
position of the Indemnifying Party and the position of such
Indemnified Party (a “Material Conflict”). If requested
by the Indemnifying Party and there is no Material Conflict, the
Indemnified Party agrees to cooperate with the Indemnifying Party
and his counsel in contesting any Claim or demand which the
Indemnifying Party elects to contest or, if appropriate and related
to the Claim in question, in making any Counterclaim against the
person asserting the third party Claim or demand, or any
cross-complaint against any person. No Claim for which indemnity is
sought hereunder and for which the Indemnifying Party has
acknowledged liability for indemnification under this Article 11
may be settled without the consent of the Indemnifying Party, which
consent shall not be unreasonably withheld or delayed.


 



 

28







 






 


(b) In
the event any Indemnified Party should have a Claim against any
Indemnifying Party hereunder which does not involve a Claim or
demand being asserted against or sought to be collected from him by
a third party, the Indemnified Party shall give a Claim Notice with
respect to such Claim to the Indemnifying Party. If, after receipt
of a Claim Notice, the Indemnifying Party does not notify the
Indemnified Party within the Notice Period that he disputes such
Claim, then the Indemnifying Party shall be deemed to have admitted
liability for such Claim in the amount set forth in the Claim
Notice.


 


(c) The
Indemnifying Party shall be given the opportunity to defend the
respective Claim.


 



ARTICLE XII



MISCELLANEOUS PROVISIONS


 


Section
12.1        Expenses.
Except as otherwise expressly provided in this Agreement, each
Party will bear its respective expenses incurred in connection with
the preparation, execution, and performance of this Agreement and
the transactions contemplated by this Agreement, including all fees
and expenses of agents, representatives, counsel, and accountants.
In the event of termination of this Agreement, the obligation of
each Party to pay its own expenses will be subject to any rights of
such Party arising from a breach of this Agreement by another
Party.


 


Section
12.2        Confidentiality.
The Parties will maintain in confidence, and will cause their
respective directors, officers, employees, agents, and advisors to
maintain in confidence, any written, oral, or other information
obtained in confidence from another Person in connection with this
Agreement or the transactions contemplated by this Agreement,
unless (a) such information is already known to such Party or to
others not bound by a duty of confidentiality or such information
becomes publicly available through no fault of such Party, (b) the
use of such information is necessary or appropriate in making any
required filing with the SEC, or obtaining any consent or approval
required for the consummation of the transactions contemplated by
this Agreement, or (c) the furnishing or use of such information is
required by or necessary or appropriate in connection with legal
proceedings.


 


(b)     In
the event that any Party is required to disclose any information of
another Person pursuant to clause (b) or (c) of Section 12.2(a) above, the
Party requested or required to make the disclosure (the
“Disclosing
Party”) shall provide the Person that provided such
information (the “Providing
Party”) with prompt notice of any such requirement so
that the providing party may seek a protective Order or other
appropriate remedy and/or waive compliance with the provisions of
this Section 12.2.
If, in the absence of a protective Order or other remedy or the
receipt of a waiver by the providing party, the disclosing party is
nonetheless, in the opinion of counsel, legally compelled to
disclose the information of the providing party, the disclosing
party may, without liability hereunder, disclose only that portion
of the providing party’s information which such counsel
advises is legally required to be disclosed, provided that the
disclosing party exercises its reasonable efforts to preserve the
confidentiality of the providing party’s information,
including, without limitation, by cooperating with the providing
party to obtain an appropriate protective Order or other relief
assurance that confidential treatment will be accorded the
providing party’s information.


 


(c)     If
the transactions contemplated by this Agreement are not
consummated, each Party will return or destroy all of such written
information each party has regarding the other
Parties.


  



 

29







 






 


Section
12.3        Notices.
All notices, demands, consents, requests, instructions and other
communications to be given or delivered or permitted under or by
reason of the provisions of this Agreement or in connection with
the transactions contemplated hereby shall be in writing and shall
be deemed to be delivered and received by the intended recipient as
follows: (i) if personally delivered, on the Business Day of such
delivery (as evidenced by the receipt of the personal delivery
service), (ii) if mailed certified or registered mail return
receipt requested, two (2) Business Days after being mailed, (iii)
if delivered by overnight courier (with all charges having been
prepaid), on the Business Day of such delivery (as evidenced by the
receipt of the overnight courier service of recognized standing),
or (iv) if delivered by facsimile transmission or other electronic
means, including email, on the Business Day of such delivery if
sent by 6:00 p.m. in the time zone of the recipient, or if sent
after that time, on the next succeeding Business Day. If any
notice, demand, consent, request, instruction or other
communication cannot be delivered because of a changed address of
which no notice was given (in accordance with this
Section
12.3), or the refusal to accept
same, the notice, demand, consent, request, instruction or other
communication shall be deemed received on the second business day
the notice is sent (as evidenced by a sworn affidavit of the
sender). All such notices, demands, consents, requests,
instructions and other communications will be sent to the following
addresses or facsimile numbers as applicable:


 


	

If to
Acquiror or the Acquiror Principal Shareholders, to:

	
 

	

Friendable,
Inc.


1821 S.
Bascom Avenue


Campbell,
CA 95008


Attn:
Chief Executive Officer


	
 

	
 

	
 


	

With a
copy by fax only to (which shall not constitute
notice):

	
 

	

Grushko
& Mittman, P.C.


515
Rockaway Avenue


Valley
Stream, New York 11581


Attn:
Barbara R. Mittman, Esq.


Fax:
(212) 697-3575


	
 

	
 

	
 


	

If to
the Acquiree, to:

	
 

	

Sharps
Technology Inc.


One
Penn Plaza, 36th Floor


New
York, NY 10119Attn: Executive Chairman


Telephone
No.: (516)757-3791


	
 

	
 

	
 


	

With a
copy by fax only to (which shall not constitute
notice):

	
 

	

Sichenzia
Ross Ference Kesner LLP


61
Broadway, 32nd Floor


New
York, NY 10006


Attn:
Arthur Marcus, Esq.


Fax:
212 930 9725


	
 

	
 

	
 


	

If to
the Acquiree Principal Shareholders, to:

	
 

	

The
applicable address set forth on Schedule I hereto.







 


or such
other addresses as shall be furnished in writing by any Party in
the manner for giving notices hereunder.


 


Section
12.4        Further
Assurances. The Parties agree
(a) to furnish upon request to each other such further information,
(b) to execute and deliver to each other such other documents, and
(c) to do such other acts and things, all as the other Parties may
reasonably request for the purpose of carrying out the intent of
this Agreement and the documents referred to in this
Agreement.


 


Section
12.5        Waiver. The rights and remedies
of the Parties are cumulative and not alternative. Neither the
failure nor any delay by any Party in exercising any right, power,
or privilege under this Agreement or the documents referred to in
this Agreement will operate as a waiver of such right, power, or
privilege, and no single or partial exercise of any such right,
power, or privilege will preclude any other or further exercise of
such right, power, or privilege or the exercise of any other right,
power, or privilege. To the maximum extent permitted by applicable
Law, (a) no claim or right arising out of this Agreement or the
documents referred to in this Agreement can be discharged by one
Party, in whole or in part, by a waiver or renunciation of the
claim or right unless in writing signed by the other Parties; (b)
no waiver that may be given by a Party will be applicable except in
the specific instance for which it is given; and (c) no notice to
or demand on one Party will be deemed to be a waiver of any
obligation of such Party or of the right of the Party giving such
notice or demand to take further action without notice or demand as
provided in this Agreement or the documents referred to in this
Agreement.


 



 

30







 






 


Section
12.6        Entire Agreement and
Modification. This Agreement
supersedes all prior agreements between the Parties with respect to
its subject matter and constitutes (along with the documents
referred to in this Agreement) a complete and exclusive statement
of the terms of the agreement between the Parties with respect to
its subject matter. This Agreement may not be amended except by a
written agreement executed by the Party against whom the
enforcement of such amendment is sought.


 


Section
12.7     Assignments,
Successors, and No Third-Party Rights. No Party may assign any of its rights under this
Agreement without the prior consent of the other Parties. Subject
to the preceding sentence, this Agreement will apply to, be binding
in all respects upon, and inure to the benefit of and be
enforceable by the respective successors and permitted assigns of
the Parties. Except as set forth in Article XIII
hereof, nothing expressed or referred
to in this Agreement will be construed to give any Person other
than the Parties any legal or equitable right, remedy, or claim
under or with respect to this Agreement or any provision of this
Agreement.


 


Section
12.8     Severability.
If any provision of this Agreement is held invalid or unenforceable
by any court of competent jurisdiction, the other provisions of
this Agreement will remain in full force and effect. Any provision
of this Agreement held invalid or unenforceable only in part or
degree will remain in full force and effect to the extent not held
invalid or unenforceable.


 


Section
12.9     Section
Headings. The headings of
Articles and Sections in this Agreement are provided for
convenience only and will not affect its construction or
interpretation. All references to “Article” or
“Articles” or “Section” or
“Sections” refer to the corresponding Article or
Articles or Section or Sections of this Agreement, unless the
context indicates otherwise.


 


Section
12.10     Construction.
The Parties have participated jointly in the negotiation and
construction of this Agreement. Each Party has retained independent
legal counsel to advise on this Agreement. In the event an
ambiguity or question of intent or interpretation arises, this
Agreement shall be construed as if drafted jointly by the Parties
and no presumption or burden of proof shall arise favoring or
disfavoring any Party by virtue of the authorship of any of the
provisions of this Agreement. Any reference to any federal, state,
local, or foreign statute or Law shall be deemed also to refer to
all rules and regulations promulgated thereunder, unless the
context requires otherwise. Unless otherwise expressly provided,
the word “including” shall mean including without
limitation. The Parties intend that each representation, warranty,
and covenant contained herein shall have independent significance.
If any Party has breached any representation, warranty, or covenant
contained herein in any respect, the fact that there exists another
representation, warranty, or covenant relating to the same subject
matter (regardless of the relative levels of specificity) which the
Party has not breached shall not detract from or mitigate the fact
that the Party is in breach of such representation, warranty, or
covenant. All words used in this Agreement will be construed to be
of such gender or number as the circumstances
require.


 


Section
12.11     Counterparts.
This Agreement may be executed in one or more counterparts, each of
which will be deemed to be an original copy of this Agreement and
all of which, when taken together, will be deemed to constitute one
and the same agreement. In the event that any signature is
delivered by facsimile transmission or by e-mail delivery of a
“.pdf” format data file, such signature shall create a
valid and binding obligation of the Party executing (or on whose
behalf such signature is executed) with the same force and effect
as if such facsimile or “.pdf” signature page were an
original thereof.


 



 

31







 






 


Section
12.12     Specific
Performance. Each of the
Parties acknowledges and agrees that the other Parties would be
damaged irreparably in the event any of the provisions of this
Agreement are not performed in accordance with their specific terms
or otherwise are breached. Accordingly, each of the Parties agrees
that the other Parties shall be entitled to an injunction or
injunctions to prevent breaches of the provisions of this Agreement
and to enforce specifically this Agreement and the terms and
provisions hereof in any action instituted in any court of the U.S.
or any state thereof having jurisdiction over the Parties and the
matter (subject to the provisions set forth in Section 14.13
below), in addition to any other
remedy to which they may be entitled, at Law or in equity, except
that in no way may a Party terminating prior to the Closing Date
pursuant to Section 10.1 be required to close the Share
Exchange.


 


Section
12.13     Governing Law;
Submission to Jurisdiction.
This Agreement shall be governed by and construed in accordance
with the Laws of the State of New York without regard to conflicts
of Laws principles. Each of the Parties submits to the jurisdiction
of any state or federal court sitting in the State of New York, in
any action or proceeding arising out of or relating to this
Agreement and agrees that all claims in respect of the action or
proceeding may be heard and determined in any such court. Each of
the Parties waives any defense of inconvenient forum to the
maintenance of any action or proceeding so brought and waives any
bond, surety, or other security that might be required of any other
Party with respect thereto. Any Party may make service on any other
Party by sending or delivering a copy of the process to the Party
to be served at the address and in the manner provided for the
giving of notices in Section 12.3
above. Nothing in this
Section
12.13, however, shall affect
the right of any Party to serve legal process in any other manner
permitted by Law or at equity. Each Party agrees that a final
judgment in any action or proceeding so brought shall be conclusive
and may be enforced by suit on the judgment or in any other manner
provided by Law or at equity.


 


Section
12.14     Waiver of Jury
Trial. EACH OF THE PARTIES
HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY
LEGAL PROCEEDING ARISING OUT OF OR RELATED TO THIS AGREEMENT OR THE
TRANSACTIONS CONTEMPLATED HEREBY.


 



[Signatures follow on next page]






 


 


 


 


 


 


 


 


 


 


 



 


 


 




 

32








 






 


IN
WITNESS WHEREOF, the undersigned have caused this Agreement to be
executed as of the date first above written.


 


	

ACQUIROR:  


	
 

	
 


	

FRIENDABLE, INC.  


	
 

	
 


	
 

	
 


	


By:

	


 


	

ROBERT ROSITANO, CEO  


	
 

	
 


	
 

	
 


	

ACQUIROR PRINCIPAL SHAREHOLDERS:  


	
 

	
 


	
 

	
 


	


   


	

ROBERT ROSITANO  


	
 

	
 


	
 

	
 


	

 


	

DEAN ROSITANO  


	
 

	
 


	
 

	
 


	


   


	

FRANK GARCIA  


	
 

	
 


	
 

	
 


	

COOPER CREEK HOLDINGS LLC  


	
 

	
 


	
 

	
 


	


By:

	


 


	


Name:

	
 


	


Title:

	
 







 


 



[Signatures continue on next page]


 


 


 




 

33








 






 

 


IN
WITNESS WHEREOF, the undersigned have caused this Agreement to be
executed as of the date first above written.


 


	

ACQUIREE:  


	
 

	
 


	

SHARPS TECHNOLOGY, INC.  


	
 

	
 


	
 

	
 


	


By:

	
 







 







IN
WITNESS WHEREOF, the undersigned have caused this Agreement to be
executed as of the date first above written.


 


	


ACQUIREE PRINCIPAL SHAREHOLDERS:


	
 


	
 


	


 


	

ALAN
BLACKMAN


	
 


	
 


	


 


	

DAVID
LOEWENSTEIN


	
 


	
 


	


 


	

BARRY
BERLER







 


 


 




 


 




 

34








 






 

 



SCHEDULE I (TO BE COMPLETED AT CLOSING)


 


 


	


Acquiree Principal Shareholders

	
 

	


Acquiree Shares Held Prior to the Closing

	
 

	
 

	


Acquiror Common Shares to be Issued at the Closing

	
 


	

Alan
Blackman

	
 

	
 

	

2,200,000

	
 

	
 

	
 

	
 

	
 


	

David
Loewenstein

	
 

	
 

	

2,200,000

	
 

	
 

	
 

	
 

	
 


	

Barry
Berler

	
 

	
 

	

3,200,000

	
 

	
 

	
 

	
 

	
 


	


Total

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 







 


 


 




 

35








 






 



Company Schedules


 



Schedule 4.7 Capitalization


 




(a)

Vesting






Each of
the individuals listed below have received stock grants which are
subject to vesting. The grants vested 25% upon issuance and 25% one
year thereafter and the remaining 50% in two years provided that
such individuals remain with the Company.


 


	

Edgar
Nouss

	

400,000

	

Shares


	

George
Cagna

	

250,000

	

Shares







 




(b)

Options






The
following individuals have received options to purchase Common
Stock in the amounts set forth next to their respective
names:


 


	

Soren
Christianson

	

200,000


	

Tony
Mulone

	

200,000


	

Armine
Cline

	

100,000


	

Pat
Folcarelli

	

20,000


	

Cindy
Dannar

	

20,000


	

Steven
Hertz, MD

	

100,000







 


All of
the options are exercisable at $0.50 per share for a period of five
years, except for the options held by Steven Hertz, MD which are
exercisable at $0.80 per share. The options vest on the same
vesting schedule as the shares set forth in 4.7(a)
above.


 

 



Schedule 4.12 Intellectual Property



United States Patent No. 743025

 


 




 

36








 






 



Schedule 5.5

 



Subsidiaries

 


 

 


	


Name

	
 

	


State of Formation


	

iHookup
Social, Inc.*

	
 

	

Delaware


	

Fan
Pass, Inc.*

	
 

	

Nevada


	
 

	
 

	
 


	

*These
subsidiaries are wholly owned subsidiaries of Friendable,
Inc.







 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 




 

37








 






 



Schedule 5.6

 


Stock
Option Plan

 

 


Effective
November 22, 2011 our board of directors adopted and approved our
stock option plan. The purpose of the stock option plan is to
enhance the long-term stockholder value of our company by offering
opportunities to directors, key employees, officers, independent
contractors and consultants of our company to acquire and maintain
stock ownership in our company in order to give these persons the
opportunity to participate in our company’s growth and
success, and to encourage them to remain in the service of our
company. A total of 1,899 shares of our common stock are available
for issuance under the stock option plan.

 


	


Plan Category


 

	


Number of Securities to be Issued Upon Exercise of Outstanding
Options, Warrants and Rights


 

	


Weighted-Average Exercise Price of Outstanding Options, Warrants
and Rights


 

	


Number of Securities Remaining Available for Future Issuance under
Equity Compensation Plan


 


	

Equity
compensation plans approved by security holders

	

Nil

	

Nil

	

Nil


	

Equity
compensation plans not approved by security holders

	

3,075

	

$1,044

	

1,899


	


Total

	

3,075

	

$1,044

	

1,899






 


 



SHARE PURCHASE WARRANTS

 



Details of share purchase warrants during the year ended December
31, 2017 and 2016 are:

 


	
 

	
 
 

 

	
 
Weighted
Average

 


	
 

	
 
 Number
of

 

	
 
Exercise

 


	
 

	
 
Warrants

 

	
 
Price
$

 


	
Balance,
December 31, 2015

	
  119,471,154 

	
  0.014 


	
Warrants
exercised

	
  (27,609,756)

	
  0.004 


	
Warrants
issued

	
  886,474,359 

	
  0.003 


	
Balance,
December 31, 2016

	
  978,335,757 

	
  0.005 


	
Warrants
issued

	
  118,000,000 

	
  0.003 


	
Balance,
December 31, 2017

	
  1,096,335,757 

	
  0.004 






 


 


 


 


 


 


 



 

38







 






 






 



 

39







 






 



 



 

40







 





 







Schedule 5.7


 


Non-Compliance
with Laws:

 


 


None

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 


 

 




 

41








 






 



Schedule 5.13

 


Employee
Benefits

 


 


Stock
Option Plan

 


 


Effective
November 22, 2011 our board of directors adopted and approved our
stock option plan. The purpose of the stock option plan is to
enhance the long-term stockholder value of our company by offering
opportunities to directors, key employees, officers, independent
contractors and consultants of our company to acquire and maintain
stock ownership in our company in order to give these persons the
opportunity to participate in our company’s growth and
success, and to encourage them to remain in the service of our
company. A total of 1,899 shares of our common stock are available
for issuance under the stock option plan.

 


	


Plan Category


 

	


Number of Securities to be Issued Upon Exercise of Outstanding
Options, Warrants and Rights


 

	


Weighted-Average Exercise Price of Outstanding Options, Warrants
and Rights


 

	


Number of Securities Remaining Available for Future Issuance under
Equity Compensation Plan


 


	

Equity
compensation plans approved by security holders

	

Nil

	

Nil

	

Nil


	

Equity
compensation plans not approved by security holders

	

3,075

	

$1,044

	

1,899


	


Total

	

3,075

	

$1,044

	

1,899






 


 

 

 



Employment Agreements

 

 


 


	
 

	


$ 


	
 

	
 


	


Dean and Robert Rositano (1)

	


300,000






 


 



(1) Employment agreements with related parties.

 


 

 




 

42








 






 



Schedule 5.14

 


Assets
with no Title:

 


 

 


None


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 

 




 

43








 






 



Schedule 5.15

 


Intellectual
Property

 


 

 


	


United States Trademarks


 

	


Serial Number


	

Friendable

	

85406679


	

Fan
Pass Live

	

87265318


	

Fan
Pass

	

87263844







 

 


 


 


 


 


 


 


 


 


 


 


 


 


 

 


 

 




 

44








 






 



Schedule 5.20

 


Unrecorded
Liabilities:

 

 


None

 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 

 


 




 

45