SECURITIES
PURCHASE AGREEMENT






This
SECURITIES PURCHASE AGREEMENT (the “Agreement”), dated as of February 15, 2012, by and between SUNVALLEY
SOLAR, INC., a Nevada corporation, with headquarters located at 398 Lemon Creek Drive - Suite A, Walnut, CA 91789 (the “Company”),
and ASHER ENTERPRISES, INC., a Delaware corporation, with its address at 1 Linden Place, Suite 207, Great Neck, NY 11021
(the “Buyer”).


 


WHEREAS:


 


A.                 
The Company and the Buyer are executing and delivering this Agreement in reliance
upon the exemption from securities registration afforded by the rules and regulations as promulgated by the United States Securities
and Exchange Commission (the “SEC”) under the Securities Act of 1933, as amended (the “1933 Act”);


 


B.                 
Buyer desires to purchase and the Company desires to issue and sell, upon the
terms and conditions set forth in this Agreement an 8% convertible note of the Company, in the form attached hereto as Exhibit
A, in the aggregate principal amount of $78,500.00 (together with any note(s) issued in replacement thereof or as a dividend thereon
or otherwise with respect thereto in accordance with the terms thereof, the “Note”), convertible into shares of common
stock, $0.001 par value per share, of the Company (the “Common Stock”), upon the terms and subject to the limitations
and conditions set forth in such Note.


 


C.                 
The Buyer wishes to purchase, upon the terms and conditions stated in this
Agreement, such principal amount of Note as is set forth immediately below its name on the signature pages hereto; and


 


NOW
THEREFORE, the Company and the Buyer severally (and not jointly) hereby agree as follows:


 


1.                 
Purchase and Sale of Note.


 


a.                  
Purchase of Note. On the Closing Date (as defined below), the Company
shall issue and sell to the Buyer and the Buyer agrees to purchase from the Company such principal amount of Note as is set forth
immediately below the Buyer’s name on the signature pages hereto.


 


b.                 
Form of Payment. On the Closing Date (as defined below), (i)
the Buyer shall pay the purchase price for the Note to be issued and sold to it at the Closing (as defined below) (the “Purchase
Price”) by wire transfer of immediately available funds to the Company, in accordance with the Company’s written wiring
instructions, against delivery of the Note in the principal amount equal to the Purchase Price as is set forth immediately below
the Buyers name on the signature pages hereto, and (ii) the Company shall deliver such duly executed
Note on behalf of the Company, to the Buyer, against delivery of such Purchase Price. 



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c.                  
Closing Date. Subject to the satisfaction (or written waiver) of the
conditions thereto set forth in Section 6 and Section 7 below, the date and time of the issuance and sale of the Note pursuant
to this Agreement (the “Closing Date”) shall be 12:00 noon, Eastern Standard Time on February 21, 2012, or such other
mutually agreed upon time. The closing of the transactions contemplated by this Agreement (the “Closing”) shall occur
on the Closing Date at such location as may be agreed to by the parties.


 


2.                 
Buyer’s Representations and Warranties. The Buyer represents and
warrants to the Company that:


 


a.                  
Investment Purpose. As of the date hereof, the Buyer is purchasing the
Note and the shares of Common Stock issuable upon conversion of or otherwise pursuant to the Note (including, without limitation,
such additional shares of Common Stock, if any, as are issuable (i) on account of interest on the Note, (ii) as
a result of the events described in Sections 1.3 and 1.4(g) of the Note or (iii) in payment of the Standard Liquidated Damages
Amount (as defined in Section 2(f) below) pursuant to this Agreement, such shares of Common Stock being collectively referred
to herein as the “Conversion Shares” and, collectively with the Note, the “Securities”) for its own account
and not with a present view towards the public sale or distribution thereof, except pursuant to sales registered or exempted from
registration under the 1933 Act; provided, however, that by making the representations herein, the Buyer does not
agree to hold any of the Securities for any minimum or other specific term and reserves the right to dispose of the Securities
at any time in accordance with or pursuant to a registration statement or an exemption under the 1933 Act.


 


b.                 
Accredited Investor Status. The Buyer is an “accredited investor”
as that term is defined in Rule 501(a) of Regulation D (an “Accredited Investor”).


 


c.                  
Reliance on Exemptions. The Buyer understands that the Securities are
being offered and sold to it in reliance upon specific exemptions from the registration requirements of United States federal
and state securities laws and that the Company is relying upon the truth and accuracy of, and the Buyer’s compliance with,
the representations, warranties, agreements, acknowledgments and understandings of the Buyer set forth herein in order to determine
the availability of such exemptions and the eligibility of the Buyer to acquire the Securities.


 


d.                 
Information. The Buyer and its advisors, if any, have been, and for
so long as the Note remain outstanding will continue to be, furnished with all materials relating to the business, finances and
operations of the Company and materials relating to the offer and sale of the Securities which have been requested by the Buyer
or its advisors. The Buyer and its advisors, if any, have been, and for so long as the Note remain outstanding will continue to
be, afforded the opportunity to ask questions of the Company. Notwithstanding the foregoing, the Company has not disclosed to
the Buyer any material nonpublic information and will not disclose such information unless such information is disclosed to the
public prior to or promptly following such disclosure to the Buyer. Neither such inquiries nor any other due diligence investigation
conducted by Buyer or any of its advisors or representatives shall modify, amend or affect Buyer’s right to rely on the
Company’s representations and warranties contained in Section 3 below. The Buyer understands that its investment in the
Securities involves a significant degree of risk. The Buyer is not aware of any facts that may constitute a breach of any of the
Company's representations and warranties made herein.



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e.                  
Governmental Review. The Buyer understands that no United States federal
or state agency or any other government or governmental agency has passed upon or made any recommendation or endorsement of the
Securities.


 


f.                  
Transfer or Re-sale. The Buyer understands that (i) the
sale or re-sale of the Securities has not been and is not being registered under the 1933 Act or any applicable state securities
laws, and the Securities may not be transferred unless (a) the Securities are sold pursuant to an effective registration
statement under the 1933 Act, (b) the Buyer
shall have delivered to the Company, at the cost of the Buyer, an opinion of counsel that shall be in form, substance and scope
customary for opinions of counsel in comparable transactions to the effect that the Securities to be sold or transferred may be
sold or transferred pursuant to an exemption from such registration, which opinion shall be accepted by the Company, (c) the
Securities are sold or transferred to an “affiliate” (as defined in Rule 144 promulgated under the 1933 Act (or a
successor rule) (“Rule 144”)) of the Buyer who agrees to sell or otherwise transfer the Securities only in accordance
with this Section 2(f) and who is an Accredited Investor, (d) the Securities are sold pursuant to Rule 144, or (e) the
Securities are sold pursuant to Regulation S under the 1933 Act (or a successor rule) (“Regulation S”), and the Buyer
shall have delivered to the Company, at the cost of the Buyer, an opinion of counsel that shall be in form, substance and scope
customary for opinions of counsel in corporate transactions, which opinion shall be accepted by the Company; (ii) any sale of
such Securities made in reliance on Rule 144 may be made only in accordance with the terms of said Rule and further, if said Rule
is not applicable, any re-sale of such Securities under circumstances in which the seller (or the person through whom the sale
is made) may be deemed to be an underwriter (as that term is defined in the 1933 Act) may require compliance with some other exemption
under the 1933 Act or the rules and regulations of the SEC thereunder; and (iii) neither the Company nor any other person is under
any obligation to register such Securities under the 1933 Act or any state securities laws or to comply with the terms and conditions
of any exemption thereunder (in each case). Notwithstanding the foregoing or anything else contained herein to the contrary, the
Securities may be pledged as collateral in connection with a bona fide margin account or other lending arrangement.



 


g.                 
Legends. The Buyer understands that the Note and, until such time as
the Conversion Shares have been registered under the 1933 Act may be sold pursuant to Rule 144 or Regulation S without any restriction
as to the number of securities as of a particular date that can then be immediately sold, the Conversion Shares may bear a restrictive
legend in substantially the following form (and a stop-transfer order may be placed against transfer of the certificates for such
Securities):


 


“NEITHER
THE ISSUANCE AND SALE OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE NOR THE SECURITIES INTO WHICH THESE SECURITIES ARE EXERCISABLE
HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THE SECURITIES MAY NOT
BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED (I) IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR (B) AN OPINION OF COUNSEL (WHICH COUNSEL SHALL BE SELECTED BY THE HOLDER), IN
A GENERALLY ACCEPTABLE FORM, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR (II) UNLESS SOLD PURSUANT TO RULE 144 OR RULE
144A UNDER SAID ACT. NOTWITHSTANDING THE FOREGOING, THE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT
OR OTHER LOAN OR FINANCING ARRANGEMENT SECURED BY THE SECURITIES.”



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The
legend set forth above shall be removed and the Company shall issue a certificate without such legend to the holder of any Security
upon which it is stamped, if, unless otherwise required by applicable state securities laws, (a) such Security is registered for
sale under an effective registration statement filed under the 1933 Act or otherwise may be sold pursuant to Rule 144 or Regulation
S without any restriction as to the number of securities as of a particular date that can then be immediately sold, or (b) such
holder provides the Company with an opinion of counsel, in form, substance and scope customary for opinions of counsel in comparable
transactions, to the effect that a public sale or transfer of such Security may be made without registration under the 1933 Act,
which opinion shall be accepted by the Company so that the sale or transfer is effected. The Buyer agrees to sell all Securities,
including those represented by a certificate(s) from which the legend has been removed, in compliance with applicable prospectus
delivery requirements, if any. In the event that the Company does not accept the opinion of counsel provided by the Buyer with
respect to the transfer of Securities pursuant to an exemption from registration, such as Rule 144 or Regulation S, at the Deadline,
it will be considered an Event of Default pursuant to Section 3.2 of the Note.


 


h.                 
Authorization; Enforcement. This Agreement has been duly and validly
authorized. This Agreement has been duly executed and delivered on behalf of the Buyer, and this Agreement constitutes a valid
and binding agreement of the Buyer enforceable in accordance with its terms.


i.                   
Residency. The Buyer is a resident of the jurisdiction set forth immediately
below the Buyer’s name on the signature pages hereto. 


 


3.                 
Representations and Warranties of the Company. The Company represents
and warrants to the Buyer that:



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a.                  
Organization and Qualification. The Company and each of its Subsidiaries
(as defined below), if any, is a corporation duly organized, validly existing and in good standing under the laws of the jurisdiction
in which it is incorporated, with full power and authority (corporate and other) to own, lease, use and operate its properties
and to carry on its business as and where now owned, leased, used, operated and conducted. Schedule 3(a) sets forth a list of
all of the Subsidiaries of the Company and the jurisdiction in which each is incorporated. The Company and each of its Subsidiaries
is duly qualified as a foreign corporation to do business and is in good standing in every jurisdiction in which its ownership
or use of property or the nature of the business conducted by it makes such qualification necessary except where the failure to
be so qualified or in good standing would not have a Material Adverse Effect. “Material Adverse Effect” means any
material adverse effect on the business, operations, assets, financial condition or prospects of the Company or its Subsidiaries,
if any, taken as a whole, or on the transactions contemplated hereby or by the agreements or instruments to be entered into in
connection herewith. “Subsidiaries” means any corporation or other organization, whether incorporated or unincorporated,
in which the Company owns, directly or indirectly, any equity or other ownership interest.


 


b.                 
Authorization; Enforcement. (i) The Company has all requisite corporate
power and authority to enter into and perform this Agreement, the Note and to consummate the transactions contemplated hereby
and thereby and to issue the Securities, in accordance with the terms hereof and thereof, (ii) the execution and delivery of this
Agreement, the Note by the Company and the consummation by it of the transactions contemplated hereby and thereby (including without
limitation, the issuance of the Note and the issuance and reservation for issuance of the Conversion Shares issuable upon conversion
or exercise thereof) have been duly authorized by the Company’s Board of Directors and no further consent or authorization
of the Company, its Board of Directors, or its shareholders is required, (iii) this Agreement has been duly executed and delivered
by the Company by its authorized representative, and such authorized representative is the true and official representative with
authority to sign this Agreement and the other documents executed in connection herewith and bind the Company accordingly, and
(iv) this Agreement constitutes, and upon execution and delivery by the Company of the Note, each of such instruments will constitute,
a legal, valid and binding obligation of the Company enforceable against the Company in accordance with its terms.


 


c.                  
Capitalization. As of the date hereof, the authorized capital stock
of the Company consists of: (i) 1,500,000,000 shares of Common Stock, $0.001 par value per share, of which 876,039,889 shares
are issued and outstanding; and (ii) there are no authorized shares of Preferred Stock; no shares are reserved for issuance pursuant
to the Company’s stock option plans, no shares are reserved for issuance pursuant to securities (other than the Note and
two (2) prior convertible promissory notes in favor of the Buyer: (a) prior convertible promissory note in favor of the Buyer
dated September 23, 2011 in the amount of $75,000.00 for which 300,000,000 shares of Common Stock are presently reserved and (b)
prior convertible promissory note in favor of the Buyer dated October 18, 2011 in the amount of $75,000.00 for which 167,000,000
shares of Common Stock are presently reserved) exercisable for, or convertible into or exchangeable for shares of Common Stock
and 156,500,000 shares are reserved for issuance upon conversion of the Note. All of such outstanding shares of capital stock
are, or upon issuance will be, duly authorized, validly issued, fully paid and non-assessable. No shares of capital stock of the
Company are subject to preemptive rights or any other similar rights of the shareholders of the Company or any liens or encumbrances
imposed through the actions or failure to act of the Company. As of the effective date of this Agreement, (i) there are no outstanding
options, warrants, scrip, rights to subscribe for, puts, calls, rights of first refusal, agreements, understandings, claims or
other commitments or rights of any character whatsoever relating to, or securities or rights convertible into or exchangeable
for any shares of capital stock of the Company or any of its Subsidiaries, or arrangements by which the Company or any of its
Subsidiaries is or may become bound to issue additional shares of capital stock of the Company or any of its Subsidiaries, (ii)
there are no agreements or arrangements under which the Company or any of its Subsidiaries is obligated to register the sale of
any of its or their securities under the 1933 Act and (iii) there are no anti-dilution or price adjustment provisions contained
in any security issued by the Company (or in any agreement providing rights to security holders) that will be triggered by the
issuance of the Note or the Conversion Shares. The Company has furnished to the Buyer true and correct copies of the Company’s
Certificate of Incorporation as in effect on the date hereof (“Certificate of Incorporation”), the Company’s
By-laws, as in effect on the date hereof (the “By-laws”), and the terms of all securities convertible into or exercisable
for Common Stock of the Company and the material rights of the holders thereof in respect thereto. The Company shall provide the
Buyer with a written update of this representation signed by the Company’s Chief Executive on behalf of the Company as of
the Closing Date.



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d.                 
Issuance of Shares. The Conversion Shares are duly authorized and reserved
for issuance and, upon conversion of the Note in accordance with its respective terms, will be validly issued, fully paid and
non-assessable, and free from all taxes, liens, claims and encumbrances with respect to the issue thereof and shall not be subject
to preemptive rights or other similar rights of shareholders of the Company and will not impose personal liability upon the holder
thereof.


 


e.                  
Acknowledgment of Dilution. The Company understands and acknowledges
the potentially dilutive effect to the Common Stock upon the issuance of the Conversion Shares upon conversion of the Note. The
Company further acknowledges that its obligation to issue Conversion Shares upon conversion of the Note in accordance with this
Agreement, the Note is absolute and unconditional regardless of the dilutive effect that such issuance may have on the ownership
interests of other shareholders of the Company.


 


f.                  
No Conflicts. The execution, delivery and performance of this Agreement,
the Note by the Company and the consummation by the Company of the transactions contemplated hereby and thereby (including, without
limitation, the issuance and reservation for issuance of the Conversion Shares) will not (i) conflict with or result in a violation
of any provision of the Certificate of Incorporation or By-laws, or (ii) violate or conflict with, or result in a breach of any
provision of, or constitute a default (or an event which with notice or lapse of time or both could become a default) under, or
give to others any rights of termination, amendment, acceleration or cancellation of, any agreement, indenture, patent, patent
license or instrument to which the Company or any of its Subsidiaries is a party, or (iii) result in a violation of any law, rule,
regulation, order, judgment or decree (including federal and state securities laws and regulations and regulations of any self-regulatory
organizations to which the Company or its securities are subject) applicable to the Company or any of its Subsidiaries or by which
any property or asset of the Company or any of its Subsidiaries is bound or affected (except for such conflicts, defaults, terminations,
amendments, accelerations, cancellations and violations as would not, individually or in the aggregate, have a Material Adverse
Effect). Neither the Company nor any of its Subsidiaries is in violation of its Certificate of Incorporation, By-laws or other
organizational documents and neither the Company nor any of its Subsidiaries is in default (and no event has occurred which with
notice or lapse of time or both could put the Company or any of its Subsidiaries in default) under, and neither the Company nor
any of its Subsidiaries has taken any action or failed to take any action that would give to others any rights of termination,
amendment, acceleration or cancellation of, any agreement, indenture or instrument to which the Company or any of its Subsidiaries
is a party or by which any property or assets of the Company or any of its Subsidiaries is bound or affected, except for possible
defaults as would not, individually or in the aggregate, have a Material Adverse Effect. The businesses of the Company and its
Subsidiaries, if any, are not being conducted, and shall not be conducted so long as the Buyer owns any of the Securities, in
violation of any law, ordinance or regulation of any governmental entity. Except as specifically contemplated by this Agreement
and as required under the 1933 Act and any applicable state securities laws, the Company is not required to obtain any consent,
authorization or order of, or make any filing or registration with, any court, governmental agency, regulatory agency, self regulatory
organization or stock market or any third party in order for it to execute, deliver or perform any of its obligations under this
Agreement, the Note in accordance with the terms hereof or thereof or to issue and sell the Note in accordance with the terms
hereof and to issue the Conversion Shares upon conversion of the Note. All consents, authorizations, orders, filings and registrations
which the Company is required to obtain pursuant to the preceding sentence have been obtained or effected on or prior to the date
hereof. The Company is not in violation of the listing requirements of the Over-the-Counter Bulletin Board (the “OTCBB”)
and does not reasonably anticipate that the Common Stock will be delisted by the OTCBB in the foreseeable future. The Company
and its Subsidiaries are unaware of any facts or circumstances which might give rise to any of the foregoing. 






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g.                 
SEC Documents; Financial Statements. The Company has timely filed all
reports, schedules, forms, statements and other documents required to be filed by it with the SEC pursuant to the reporting requirements
of the Securities Exchange Act of 1934, as amended (the “1934 Act”) (all of the foregoing filed prior to the date
hereof and all exhibits included therein and financial statements and schedules thereto and documents (other than exhibits to
such documents) incorporated by reference therein, being hereinafter referred to herein as the “SEC Documents”). Upon
written request the Company will deliver to the Buyer true and complete copies of the SEC Documents, except for such exhibits
and incorporated documents. As of their respective dates, the SEC Documents complied in all material respects with the requirements
of the 1934 Act and the rules and regulations of the SEC promulgated thereunder applicable to the SEC Documents, and none of the
SEC Documents, at the time they were filed with the SEC, 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. None of the statements made in any such SEC Documents is, or has been, required to
be amended or updated under applicable law (except for such statements as have been amended or updated in subsequent filings prior
the date hereof). As of their respective dates, the financial statements of the Company included in the SEC Documents complied
as to form in all material respects with applicable accounting requirements and the published rules and regulations of the SEC
with respect thereto. Such financial statements have been prepared in accordance with United States generally accepted accounting
principles, consistently applied, during the periods involved and fairly present in all material respects the consolidated financial
position of the Company and its consolidated Subsidiaries as of the dates thereof and the consolidated results of their operations
and cash flows for the periods then ended (subject, in the case of unaudited statements, to normal year-end audit adjustments).
Except as set forth in the financial statements of the Company included in the SEC Documents, the Company has no liabilities,
contingent or otherwise, other than (i) liabilities incurred in the ordinary course of business subsequent to September 30, 2011,
and (ii) obligations under contracts and commitments incurred in the ordinary course of business and not required under generally
accepted accounting principles to be reflected in such financial statements, which, individually or in the aggregate, are not
material to the financial condition or operating results of the Company. The Company is subject to the reporting requirements
of the 1934 Act.



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h.                 
Absence of Certain Changes. Since September 30, 2011, there has been
no material adverse change and no material adverse development in the assets, liabilities, business, properties, operations, financial
condition, results of operations, prospects or 1934 Act reporting status of the Company or any of its Subsidiaries.


 


i.                   
Absence of Litigation. There is no action, suit, claim, proceeding,
inquiry or investigation before or by any court, public board, government agency, self-regulatory organization or body pending
or, to the knowledge of the Company or any of its Subsidiaries, threatened against or affecting the Company or any of its Subsidiaries,
or their officers or directors in their capacity as such, that could have a Material Adverse Effect. Schedule 3(i) contains a
complete list and summary description of any pending or, to the knowledge of the Company, threatened proceeding against or affecting
the Company or any of its Subsidiaries, without regard to whether it would have a Material Adverse Effect. The Company and its
Subsidiaries are unaware of any facts or circumstances which might give rise to any of the foregoing.


 


j.                   
Patents, Copyrights, etc. The Company and each of its Subsidiaries owns
or possesses the requisite licenses or rights to use all patents, patent applications, patent rights, inventions, know-how, trade
secrets, trademarks, trademark applications, service marks, service names, trade names and copyrights (“Intellectual Property”)
necessary to enable it to conduct its business as now operated (and, as presently contemplated to be operated in the future);
there is no claim or action by any person pertaining to, or proceeding pending, or to the Company’s knowledge threatened,
which challenges the right of the Company or of a Subsidiary with respect to any Intellectual Property necessary to enable it
to conduct its business as now operated (and, as presently contemplated to be operated in the future); to the best of the Company’s
knowledge, the Company’s or its Subsidiaries’ current and intended products, services and processes do not infringe
on any Intellectual Property or other rights held by any person; and the Company is unaware of any facts or circumstances which
might give rise to any of the foregoing. The Company and each of its Subsidiaries have taken reasonable security measures to protect
the secrecy, confidentiality and value of their Intellectual Property.



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k.                 
No Materially Adverse Contracts, Etc. Neither the Company nor any of
its Subsidiaries is subject to any charter, corporate or other legal restriction, or any judgment, decree, order, rule or regulation
which in the judgment of the Company’s officers has or is expected in the future to have a Material Adverse Effect. Neither
the Company nor any of its Subsidiaries is a party to any contract or agreement which in the judgment of the Company’s officers
has or is expected to have a Material Adverse Effect.


 


l.                   
Tax Status. The Company and each of its Subsidiaries has made or filed
all federal, state and foreign income and all other tax returns, reports and declarations required by any jurisdiction to which
it is subject (unless and only to the extent that the Company and each of its Subsidiaries has set aside on its books provisions
reasonably adequate for the payment of all unpaid and unreported taxes) and has paid all taxes and other governmental assessments
and charges that are material in amount, shown or determined to be due on such returns, reports and declarations, except those
being contested in good faith and has set aside on its books provisions reasonably adequate for the payment of all taxes for periods
subsequent to the periods to which such returns, reports or declarations apply. There are no unpaid taxes in any material amount
claimed to be due by the taxing authority of any jurisdiction, and the officers of the Company know of no basis for any such claim.
The Company has not executed a waiver with respect to the statute of limitations relating to the assessment or collection of any
foreign, federal, state or local tax. None of the Company’s tax returns is presently being audited by any taxing authority.


 


m.               
Certain Transactions. Except for arm’s length transactions pursuant
to which the Company or any of its Subsidiaries makes payments in the ordinary course of business upon terms no less favorable
than the Company or any of its Subsidiaries could obtain from third parties and other than the grant of stock options disclosed
on Schedule 3(c), none of the officers, directors, or employees of the Company is presently a party to any transaction with the
Company or any of its Subsidiaries (other than for services as employees, officers and directors), including any contract, agreement
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 officer, director or such employee or, to the knowledge of the Company, any
corporation, partnership, trust or other entity in which any officer, director, or any such employee has a substantial interest
or is an officer, director, trustee or partner.


 


n.                 
Disclosure. All information relating to or concerning the Company or
any of its Subsidiaries set forth in this Agreement and provided to the Buyer pursuant to Section 2(d) hereof and otherwise in
connection with the transactions contemplated hereby is true and correct in all material respects and the Company has not omitted
to state any material fact necessary in order to make the statements made herein or therein, in light of the circumstances under
which they were made, not misleading. No event or circumstance has occurred or exists with respect to the Company or any of its
Subsidiaries or its or their business, properties, prospects, operations or financial conditions, which, under applicable law,
rule or regulation, requires public disclosure or announcement by the Company but which has not been so publicly announced or
disclosed (assuming for this purpose that the Company’s reports filed under the 1934 Act are being incorporated into an
effective registration statement filed by the Company under the 1933 Act).



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o.                 
Acknowledgment Regarding Buyer’ Purchase of Securities. The Company
acknowledges and agrees that the Buyer is acting solely in the capacity of arm’s length purchasers with respect to this
Agreement and the transactions contemplated hereby. The Company further acknowledges that the Buyer is not acting as a financial
advisor or fiduciary of the Company (or in any similar capacity) with respect to this Agreement and the transactions contemplated
hereby and any statement made by the Buyer or any of its respective representatives or agents in connection with this Agreement
and the transactions contemplated hereby is not advice or a recommendation and is merely incidental to the Buyer’ purchase
of the Securities. The Company further represents to the Buyer that the Company’s decision to enter into this Agreement
has been based solely on the independent evaluation of the Company and its representatives.


 


p.                 
No Integrated Offering. Neither the Company, nor any of its affiliates,
nor any person acting on its or their behalf, has directly or indirectly made any offers or sales in any security or solicited
any offers to buy any security under circumstances that would require registration under the 1933 Act of the issuance of the Securities
to the Buyer. The issuance of the Securities to the Buyer will not be integrated with any other issuance of the Company’s
securities (past, current or future) for purposes of any shareholder approval provisions applicable to the Company or its securities.


 


q.                 
No Brokers. The Company has taken no action which would give rise to
any claim by any person for brokerage commissions, transaction fees or similar payments relating to this Agreement or the transactions
contemplated hereby. 


 


r.                   
Permits; Compliance. The Company and each of its Subsidiaries is in
possession of all franchises, grants, authorizations, licenses, permits, easements, variances, exemptions, consents, certificates,
approvals and orders necessary to own, lease and operate its properties and to carry on its business as it is now being conducted
(collectively, the “Company Permits”), and there is no action pending or, to the knowledge of the Company, threatened
regarding suspension or cancellation of any of the Company Permits. Neither the Company nor any of its Subsidiaries is in conflict
with, or in default or violation of, any of the Company Permits, except for any such conflicts, defaults or violations which,
individually or in the aggregate, would not reasonably be expected to have a Material Adverse Effect. Since September 30, 2011,
neither the Company nor any of its Subsidiaries has received any notification with respect to possible conflicts, defaults or
violations of applicable laws, except for notices relating to possible conflicts, defaults or violations, which conflicts, defaults
or violations would not have a Material Adverse Effect.



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s.                  
Environmental Matters.


 


(i)                      
There are, to the Company’s knowledge, with respect to the Company or
any of its Subsidiaries or any predecessor of the Company, no past or present violations of Environmental Laws (as defined below),
releases of any material into the environment, actions, activities, circumstances, conditions, events, incidents, or contractual
obligations which may give rise to any common law environmental liability or any liability under the Comprehensive Environmental
Response, Compensation and Liability Act of 1980 or similar federal, state, local or foreign laws and neither the Company nor
any of its Subsidiaries has received any notice with respect to any of the foregoing, nor is any action pending or, to the Company’s
knowledge, threatened in connection with any of the foregoing. The term “Environmental Laws” means all federal, state,
local or foreign laws relating to pollution or protection of human health or the environment (including, without limitation, ambient
air, surface water, groundwater, land surface or subsurface strata), including, without limitation, laws relating to emissions,
discharges, releases or threatened releases of chemicals, pollutants contaminants, or toxic or hazardous substances or wastes
(collectively, “Hazardous Materials”) into the environment, or otherwise relating to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport or handling of Hazardous Materials, as well as all authorizations,
codes, decrees, demands or demand letters, injunctions, judgments, licenses, notices or notice letters, orders, permits, plans
or regulations issued, entered, promulgated or approved thereunder.


 


(ii)                    
Other than those that are or were stored, used or disposed of in compliance
with applicable law, no Hazardous Materials are contained on or about any real property currently owned, leased or used by the
Company or any of its Subsidiaries, and no Hazardous Materials were released on or about any real property previously owned, leased
or used by the Company or any of its Subsidiaries during the period the property was owned, leased or used by the Company or any
of its Subsidiaries, except in the normal course of the Company’s or any of its Subsidiaries’ business.


 


(iii)                  
There are no underground storage tanks on or under any real property owned,
leased or used by the Company or any of its Subsidiaries that are not in compliance with applicable law.


 


t.                   
Title to Property. The Company and its Subsidiaries have good and marketable
title in fee simple to all real property and good and marketable title to all personal property owned by them which is material
to the business of the Company and its Subsidiaries, in each case free and clear of all liens, encumbrances and defects except
such as are described in Schedule 3(t) or such as would not have a Material Adverse Effect. Any real property and facilities held
under lease by the Company and its Subsidiaries are held by them under valid, subsisting and enforceable leases with such exceptions
as would not have a Material Adverse Effect.


 


u.                 
Insurance. The Company and each of its Subsidiaries are insured by insurers
of recognized financial responsibility against such losses and risks and in such amounts as management of the Company believes
to be prudent and customary in the businesses in which the Company and its Subsidiaries are engaged. Neither the Company nor any
such Subsidiary has any reason to believe that it will not be able to renew its existing insurance coverage as and when such coverage
expires or to obtain similar coverage from similar insurers as may be necessary to continue its business at a cost that would
not have a Material Adverse Effect. Upon written request the Company will provide to the Buyer true and correct copies of all
policies relating to directors’ and officers’ liability coverage, errors and omissions coverage, and commercial general
liability coverage.



    	11



    	 



    



 


v.                 
Internal Accounting Controls. The Company and each of its Subsidiaries
maintain a system of internal accounting controls sufficient, in the judgment of the Company’s board of directors, to provide
reasonable assurance that (i) transactions are executed in accordance with management’s general or specific authorizations,
(ii) transactions are recorded as necessary to permit preparation of financial statements in conformity with generally accepted
accounting principles and to maintain asset accountability, (iii) access to assets is permitted only in accordance with management’s
general or specific authorization and (iv) the recorded accountability for assets is compared with the existing assets at reasonable
intervals and appropriate action is taken with respect to any differences.


 


w.               
Foreign Corrupt Practices. Neither the Company, nor any of its Subsidiaries,
nor any director, officer, agent, employee or other person acting on behalf of the Company or any Subsidiary has, in the course
of his actions for, or on behalf of, the Company, used any corporate funds for any unlawful contribution, gift, entertainment
or other unlawful expenses relating to political activity; made any direct or indirect unlawful payment to any foreign or domestic
government official or employee from corporate funds; violated or is in violation of any provision of the U.S. Foreign Corrupt
Practices Act of 1977, as amended, or made any bribe, rebate, payoff, influence payment, kickback or other unlawful payment to
any foreign or domestic government official or employee.


 


x.                 
[INTENTIONALLY DELETED]


 


y.                 
No Investment Company. The Company is not, and upon the issuance and
sale of the Securities as contemplated by this Agreement will not be an “investment company” required to be registered
under the Investment Company Act of 1940 (an “Investment Company”). The Company is not controlled by an Investment
Company.


 


z.                  
Breach of Representations and Warranties by the Company. If the Company
breaches any of the representations or warranties set forth in this Section 3, and in addition to any other remedies available
to the Buyer pursuant to this Agreement, it will be considered an Event of default under Section 3.4 of the Note.


 


4.                 
COVENANTS.


 


a.                  
Best Efforts. The parties shall use their best efforts to satisfy timely
each of the conditions described in Section 6 and 7 of this Agreement. 


 


b.                 
Form D; Blue Sky Laws. The Company agrees to file a Form D with respect
to the Securities as required under Regulation D and to provide a copy thereof to the Buyer promptly after such filing. The Company
shall, on or before the Closing Date, take such action as the Company shall reasonably determine is necessary to qualify the Securities
for sale to the Buyer at the applicable closing pursuant to this Agreement under applicable securities or “blue sky”
laws of the states of the United States (or to obtain an exemption from such qualification), and shall provide evidence of any
such action so taken to the Buyer on or prior to the Closing Date.



    	12



    	 



    



 


c.                  
Use of Proceeds. The Company shall use the proceeds for general working
capital purposes.


 


d.                 
Right of First Refusal. Unless it shall have first delivered to the
Buyer, at least seventy two (72) hours prior to the closing of such Future Offering (as defined herein), written notice describing
the proposed Future Offering, including the terms and conditions thereof and proposed definitive documentation to be entered into
in connection therewith, and providing the Buyer an option during the seventy two (72) hour period following delivery of such
notice to purchase the securities being offered in the Future Offering on the same terms as contemplated by such Future Offering
(the limitations referred to in this sentence and the preceding sentence are collectively referred to as the “Right of First
Refusal”) (and subject to the exceptions described below), the Company will not conduct any equity financing (including
debt with an equity component) (“Future Offerings”) during the period beginning on the Closing Date and ending twelve
(12) months following the Closing Date. In the event the terms and conditions of a proposed Future Offering are amended in any
respect after delivery of the notice to the Buyer concerning the proposed Future Offering, the Company shall deliver a new notice
to the Buyer describing the amended terms and conditions of the proposed Future Offering and the Buyer thereafter shall have an
option during the seventy two (72) hour period following delivery of such new notice to purchase its pro rata share of the securities
being offered on the same terms as contemplated by such proposed Future Offering, as amended. The foregoing sentence shall apply
to successive amendments to the terms and conditions of any proposed Future Offering. The Right of First Refusal shall not apply
to any transaction involving (i) issuances of securities in a firm commitment underwritten public offering (excluding a continuous
offering pursuant to Rule 415 under the 1933 Act) or (ii) issuances of securities as consideration for a merger, consolidation
or purchase of assets, or in connection with any strategic partnership or joint venture (the primary purpose of which is not to
raise equity capital), or in connection with the disposition or acquisition of a business, product or license by the Company.
The Right of First Refusal also shall not apply to the issuance of securities upon exercise or conversion of the Company’s
options, warrants or other convertible securities outstanding as of the date hereof or to the grant of additional options or warrants,
or the issuance of additional securities, under any Company stock option or restricted stock plan approved by the shareholders
of the Company. 


 


e.                  
Expenses. At the Closing, the Company shall reimburse Buyer for expenses
incurred by them in connection with the negotiation, preparation, execution, delivery and performance of this Agreement and the
other agreements to be executed in connection herewith (“Documents”), including, without limitation, reasonable attorneys’
and consultants’ fees and expenses, transfer agent fees, fees for stock quotation services, fees relating to any amendments
or modifications of the Documents or any consents or waivers of provisions in the Documents, fees for the preparation of opinions
of counsel, escrow fees, and costs of restructuring the transactions contemplated by the Documents. When possible, the Company
must pay these fees directly, otherwise the Company must make immediate payment for reimbursement to the Buyer for all fees and
expenses immediately upon written notice by the Buyer or the submission of an invoice by the Buyer. The Company’s obligation
with respect to this transaction is to reimburse Buyer’ expenses shall be $3,500.



    	13



    	 



    



 


f.                  
Financial Information. Upon written request the Company agrees to send
or make available the following reports to the Buyer until the Buyer transfers, assigns, or sells all of the Securities: (i) within
ten (10) days after the filing with the SEC, a copy of its Annual Report on Form 10-K its Quarterly Reports on Form 10-Q and any
Current Reports on Form 8-K; (ii) within one (1) day after release, copies of all press releases
issued by the Company or any of its Subsidiaries; and (iii) contemporaneously
with the making available or giving to the shareholders of the Company, copies of any notices or other information the Company
makes available or gives to such shareholders.


 


g.                 
[INTENTIONALLY DELETED]


 


h.                 
Listing. The Company shall promptly secure the listing of the Conversion
Shares upon each national securities exchange or automated quotation system, if any, upon which shares of Common Stock are then
listed (subject to official notice of issuance) and, so long as the Buyer owns any of the Securities, shall maintain, so long
as any other shares of Common Stock shall be so listed, such listing of all Conversion Shares from time to time issuable upon
conversion of the Note. The Company will obtain and, so long as the Buyer owns any of the Securities, maintain the listing and
trading of its Common Stock on the OTCBB or any equivalent replacement exchange, the Nasdaq National Market (“Nasdaq”),
the Nasdaq SmallCap Market (“Nasdaq SmallCap”), the New York Stock Exchange (“NYSE”), or the American
Stock Exchange (“AMEX”) and will comply in all respects with the Company’s reporting, filing and other obligations
under the bylaws or rules of the Financial Industry Regulatory Authority (“FINRA”) and such exchanges, as applicable.
The Company shall promptly provide to the Buyer copies of any notices it receives from the OTCBB and any other exchanges or quotation
systems on which the Common Stock is then listed regarding the continued eligibility of the Common Stock for listing on such exchanges
and quotation systems. The Company's common stock is currently dually quoted on the OTC Bulletin Board and the Pink Sheets.
 In the event that the Company's common stock is dropped from quotation on the OTC Bulletin Board and such action is not
taken as a result of any action or failure to act on the part of the Company, the Company shall be considered in compliance with
this section so long as it remains current and in full compliance with all reporting obligations under the 1934 Act.  In
the event that the Company's common stock becomes quoted solely on the Pink Sheets, the Company shall maintain the Pink Sheets
market tier designation "OTCQB" or its equivalent."


 


i.                   
Corporate Existence. So long as the Buyer beneficially owns any Note,
the Company shall maintain its corporate existence and shall not sell all or substantially all of the Company’s assets,
except in the event of a merger or consolidation or sale of all or substantially all of the Company’s assets, where the
surviving or successor entity in such transaction (i) assumes the Company’s obligations hereunder and under the agreements
and instruments entered into in connection herewith and (ii) is a publicly traded corporation whose Common Stock is listed for
trading on the OTCBB, Nasdaq, Nasdaq SmallCap, NYSE or AMEX.



    	14



    	 



    



 


j.                   
No Integration. The Company shall not make any offers or sales of any
security (other than the Securities) under circumstances that would require registration of the Securities being offered or sold
hereunder under the 1933 Act or cause the offering of the Securities to be integrated with any other offering of securities by
the Company for the purpose of any stockholder approval provision applicable to the Company or its securities.


 


k.                 
Breach of Covenants. If the Company breaches any of the covenants set
forth in this Section 4, and in addition to any other remedies available to the Buyer pursuant to this Agreement, it will be considered
an event of default under Section 3.4 of the Note.


 


l.                   
Failure to Comply with the 1934 Act. So long as the Buyer beneficially
owns the Note, the Company shall comply with the reporting requirements of the 1934 Act; and the Company shall continue to be
subject to the reporting requirements of the 1934 Act.


 


m.               
Trading Activities. Neither the Buyer nor its affiliates has an open
short position in the common stock of the Company and the Buyer agree that it shall not, and that it will cause its affiliates
not to, engage in any short sales of or hedging transactions with respect to the common stock of the Company. 


 


5.                 
Transfer Agent Instructions. The Company shall issue irrevocable instructions
to its transfer agent to issue certificates, registered in the name of the Buyer or its nominee, for the Conversion Shares in
such amounts as specified from time to time by the Buyer to the Company upon conversion of the Note in accordance with the terms
thereof (the “Irrevocable Transfer Agent Instructions”).  In the event that the Borrower proposes to replace
its transfer agent, the Borrower shall provide, prior to the effective date of such replacement, a fully executed Irrevocable
Transfer Agent Instructions in a form as initially delivered pursuant to the Purchase Agreement (including but not limited to
the provision to irrevocably reserve shares of Common Stock in the Reserved Amount) signed by the successor transfer agent to
Borrower and the Borrower. Prior to registration of the Conversion Shares under the 1933 Act or the date on which the Conversion
Shares may be sold pursuant to Rule 144 without any restriction as to the number of Securities as of a particular date that can
then be immediately sold, all such certificates shall bear the restrictive legend specified in Section 2(g) of this Agreement. 
The Company warrants that: (i) no instruction other than the Irrevocable Transfer Agent Instructions referred to in this Section
5, and stop transfer instructions to give effect to Section 2(f) hereof (in the case of the Conversion Shares, prior to registration
of the Conversion Shares under the 1933 Act or the date on which the Conversion Shares may be sold pursuant to Rule 144 without
any restriction as to the number of Securities as of a particular date that can then be immediately sold), will be given by the
Company to its transfer agent and that the Securities shall otherwise be freely transferable on the books and records of the Company
as and to the extent provided in this Agreement and the Note; (ii) it will not direct its transfer agent not to transfer or delay,
impair, and/or hinder its transfer agent in transferring (or issuing)(electronically or in certificated form) any certificate
for Conversion Shares to be issued to the Buyer upon conversion of or otherwise pursuant to the Note as and when required by the
Note and this Agreement; and (iii) it will not fail to remove (or directs its transfer agent not to remove or impairs, delays,
and/or hinders its transfer agent from removing) any restrictive legend (or to withdraw any stop transfer instructions in respect
thereof) on any certificate for any Conversion Shares issued to the Buyer upon conversion of or otherwise pursuant to the Note
as and when required by the Note and this Agreement.  Nothing in this Section shall affect in any way the Buyer’s obligations
and agreement set forth in Section 2(g) hereof to comply with all applicable prospectus delivery requirements, if any, upon re-sale
of the Securities.  If the Buyer provides the Company, at the cost of the Buyer, with (i) an opinion of counsel in form,
substance and scope customary for opinions in comparable transactions, to the effect that a public sale or transfer of such Securities
may be made without registration under the 1933 Act and such sale or transfer is effected or (ii) the Buyer provides reasonable
assurances that the Securities can be sold pursuant to Rule 144, the Company shall permit the transfer, and, in the case of the
Conversion Shares, promptly instruct its transfer agent to issue one or more certificates, free from restrictive legend, in such
name and in such denominations as specified by the Buyer.  The Company acknowledges that a breach by it of its obligations
hereunder will cause irreparable harm to the Buyer, by vitiating the intent and purpose of the transactions contemplated hereby. 
Accordingly, the Company acknowledges that the remedy at law for a breach of its obligations under this Section 5 may be inadequate
and agrees, in the event of a breach or threatened breach by the Company of the provisions of this Section, that the Buyer shall
be entitled, in addition to all other available remedies, to an injunction restraining any breach and requiring immediate transfer,
without the necessity of showing economic loss and without any bond or other security being required.



    	15



    	 



    



 


6.                 
Conditions to the Company’s Obligation to Sell. The obligation
of the Company hereunder to issue and sell the Note to the Buyer at the Closing is subject to the satisfaction, at or before the
Closing Date of each of the following conditions thereto, provided that these conditions are for the Company’s sole benefit
and may be waived by the Company at any time in its sole discretion:


 


a.                  
The Buyer shall have executed this Agreement and delivered the same to the
Company.


 


b.                 
The Buyer shall have delivered the Purchase Price in accordance with Section
1(b) above.


 


c.                  
The representations and warranties of the Buyer shall be true and correct in
all material respects as of the date when made and as of the Closing Date as though made at that time (except for representations
and warranties that speak as of a specific date), and the Buyer shall have performed, satisfied and complied in all material respects
with the covenants, agreements and conditions required by this Agreement to be performed, satisfied or complied with by the Buyer
at or prior to the Closing Date. 


 


d.                 
No litigation, statute, rule, regulation, executive order, decree, ruling or
injunction shall have been enacted, entered, promulgated or endorsed by or in any court or governmental authority of competent
jurisdiction or any self-regulatory organization having authority over the matters contemplated hereby which prohibits the consummation
of any of the transactions contemplated by this Agreement.



    	16



    	 



    



 


7.                 
Conditions to The Buyer’s Obligation to Purchase. The obligation
of the Buyer hereunder to purchase the Note at the Closing is subject to the satisfaction, at or before the Closing Date of each
of the following conditions, provided that these conditions are for the Buyer’s sole benefit and may be waived by the Buyer
at any time in its sole discretion:


 


a.                  
The Company shall have executed this Agreement and delivered the same to the
Buyer.


 


b.                 
The Company shall have delivered to the Buyer the duly executed Note (in such
denominations as the Buyer shall request) in accordance with Section 1(b) above.


 


c.                  
The Irrevocable Transfer Agent Instructions, in form and substance satisfactory
to a majority-in-interest of the Buyer, shall have been delivered to and acknowledged in writing by the Company’s Transfer
Agent.


 


d.                 
The representations and warranties of the Company shall be true and correct
in all material respects as of the date when made and as of the Closing Date as though made at such time (except for representations
and warranties that speak as of a specific date) and the Company shall have performed, satisfied and complied in all material
respects with the covenants, agreements and conditions required by this Agreement to be performed, satisfied or complied with
by the Company at or prior to the Closing Date. The Buyer shall have received a certificate or certificates, executed by the chief
executive officer of the Company, dated as of the Closing Date, to the foregoing effect and as to such other matters as may be
reasonably requested by the Buyer including, but not limited to certificates with respect to the Company’s Certificate of
Incorporation, By-laws and Board of Directors’ resolutions relating to the transactions contemplated hereby.


 


e.                  
No litigation, statute, rule, regulation, executive order, decree, ruling or
injunction shall have been enacted, entered, promulgated or endorsed by or in any court or governmental authority of competent
jurisdiction or any self-regulatory organization having authority over the matters contemplated hereby which prohibits the consummation
of any of the transactions contemplated by this Agreement.


 


f.                  
No event shall have occurred which could reasonably be expected to have a Material
Adverse Effect on the Company including but not limited to a change in the 1934 Act reporting status of the Company or the failure
of the Company to be timely in its 1934 Act reporting obligations.


 


g.                 
The Conversion Shares shall have been authorized for quotation on the OTCBB
and trading in the Common Stock on the OTCBB shall not have been suspended by the SEC or the OTCBB.



    	17



    	 



    



 


h.                 
The Buyer shall have received an officer’s certificate described in Section
3(c) above, dated as of the Closing Date.


 


8.                 
Governing Law; Miscellaneous.


 


a.                  
Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York without regard to principles of conflicts of laws. Any action brought by either
party against the other concerning the transactions contemplated by this Agreement shall be brought only in the state courts of
New York or in the federal courts located in the state and county of Nassau. The parties to this Agreement hereby irrevocably
waive any objection to jurisdiction and venue of any action instituted hereunder and shall not assert any defense based on lack
of jurisdiction or venue or based upon forum non conveniens. The Company and Buyer waive trial by jury. The prevailing
party shall be entitled to recover from the other party its reasonable attorney's fees and costs. In the event that any provision
of this Agreement or any other agreement delivered in connection herewith is invalid or unenforceable under any applicable statute
or rule of law, then such provision shall be deemed inoperative to the extent that it may conflict therewith and shall be deemed
modified to conform with such statute or rule of law. Any such provision which may prove invalid or unenforceable under any law
shall not affect the validity or enforceability of any other provision of any agreement. Each party hereby irrevocably waives
personal service of process and consents to process being served in any suit, action or proceeding in connection with this Agreement
or any other Transaction Document by mailing a copy thereof via registered or certified mail or overnight delivery (with evidence
of delivery) to such party at the address in effect for notices to it under this Agreement and agrees that such service shall
constitute good and sufficient service of process and notice thereof. Nothing contained herein shall be deemed to limit in any
way any right to serve process in any other manner permitted by law.


 


b.                 
Counterparts; Signatures by Facsimile. This Agreement may be executed
in one or more counterparts, each of which shall be deemed an original but all of which shall constitute one and the same agreement
and shall become effective when counterparts have been signed by each party and delivered to the other party. This Agreement,
once executed by a party, may be delivered to the other party hereto by facsimile transmission of a copy of this Agreement bearing
the signature of the party so delivering this Agreement.


 


c.                  
Headings. The headings of this Agreement are for convenience of reference
only and shall not form part of, or affect the interpretation of, this Agreement.


 


d.                 
Severability. In the event that any provision of this Agreement is invalid
or unenforceable under any applicable statute or rule of law, then such provision shall be deemed inoperative to the extent that
it may conflict therewith and shall be deemed modified to conform with such statute or rule of law. Any provision hereof which
may prove invalid or unenforceable under any law shall not affect the validity or enforceability of any other provision hereof.


 


e.                  
Entire Agreement; Amendments. This Agreement and the instruments referenced
herein contain the entire understanding of the parties with respect to the matters covered herein and therein and, except as specifically
set forth herein or therein, neither the Company nor the Buyer makes any representation, warranty, covenant or undertaking with
respect to such matters. No provision of this Agreement may be waived or amended other than by an instrument in writing signed
by the majority in interest of the Buyer.



    	18



    	 



    



 


f.                  
Notices. All notices, demands, requests, consents, approvals, and other
communications required or permitted hereunder shall be in writing and, unless otherwise specified herein, shall be (i) personally
served, (ii) deposited in the mail, registered or certified, return receipt requested, postage prepaid, (iii) delivered by reputable
air courier service with charges prepaid, or (iv) transmitted by hand delivery, telegram, or facsimile, addressed as set forth
below or to such other address as such party shall have specified most recently by written notice. Any notice or other communication
required or permitted to be given hereunder shall be deemed effective (a) upon hand delivery or delivery by facsimile, with accurate
confirmation generated by the transmitting facsimile machine, at the address or number designated below (if delivered on a business
day during normal business hours where such notice is to be received), or the first business day following such delivery (if delivered
other than on a business day during normal business hours where such notice is to be received) or (b) on the second business day
following the date of mailing by express courier service, fully prepaid, addressed to such address, or upon actual receipt of
such mailing, whichever shall first occur. The addresses for such communications shall be: 


 


If
to the Company, to:





SUNVALLEY
SOLAR, INC.


398
Lemon Creek Drive - Suite A


Walnut,
CA 91789


Attn:
ZHIJIAN ZHANG, Chief Executive Officer


facsimile:
[enter fax number]


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


Joe
Laxague


Cane
Clark LLP


3273
E. Warm Springs Rd.


Las
Vegas, NV 89120


Phone:
(702) 312-6255


Fax:
(702) 944-7100





If
to the Buyer:


ASHER
ENTERPRISES, INC.


1
Linden Pl., Suite 207


Great
Neck, NY. 11021


Attn:
Curt Kramer, President


facsimile:
516-498-9894





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


Naidich
Wurman Birnbaum & Maday LLP


80
Cuttermill Road, Suite 410


facsimile:
516-466-3555






    	19



    	 



    



Each
party shall provide notice to the other party of any change in address.


 


g.                 
Successors and Assigns. This Agreement shall be binding upon and inure
to the benefit of the parties and their successors and assigns. Neither the Company nor the Buyer shall assign this Agreement
or any rights or obligations hereunder without the prior written consent of the other. Notwithstanding the foregoing, subject
to Section 2(f), the Buyer may assign its rights hereunder to any person that purchases Securities in a private transaction
from the Buyer or to any of its “affiliates,” as that term is defined under the 1934 Act, without the consent of the
Company.


 


h.                 
Third Party Beneficiaries. This Agreement is intended for the benefit
of the parties hereto and their respective permitted successors and assigns, and is not for the benefit of, nor may any provision
hereof be enforced by, any other person.


 


i.                   
Survival. The representations and warranties of the Company and the
agreements and covenants set forth in this Agreement shall survive the closing hereunder notwithstanding any due diligence investigation
conducted by or on behalf of the Buyer. The Company agrees to indemnify and hold harmless the Buyer and all their officers, directors,
employees and agents for loss or damage arising as a result of or related to any breach or alleged breach by the Company of any
of its representations, warranties and covenants set forth in this Agreement or any of its covenants and obligations under this
Agreement, including advancement of expenses as they are incurred.


 


j.                   
Publicity. The Company, and the Buyer shall have the right to review
a reasonable period of time before issuance of any press releases, SEC, OTCBB or FINRA filings, or any other public statements
with respect to the transactions contemplated hereby; provided, however, that the Company shall be entitled, without
the prior approval of the Buyer, to make any press release or SEC, OTCBB (or other applicable trading market) or FINRA filings
with respect to such transactions as is required by applicable law and regulations (although the Buyer shall be consulted by the
Company in connection with any such press release prior to its release and shall be provided with a copy thereof and be given
an opportunity to comment thereon).


 


k.                 
Further Assurances. Each party shall do and perform, or cause to be
done and performed, all such further acts and things, and shall execute and deliver all such other agreements, certificates, instruments
and documents, as the other party may reasonably request in order to carry out the intent and accomplish the purposes of this
Agreement and the consummation of the transactions contemplated hereby.


 


l.                   
No Strict Construction. The language used in this Agreement will be
deemed to be the language chosen by the parties to express their mutual intent, and no rules of strict construction will be applied
against any party.


 


m.               
Remedies. The Company acknowledges that a breach by it of its obligations
hereunder will cause irreparable harm to the Buyer by vitiating the intent and purpose of the transaction contemplated hereby.
Accordingly, the Company acknowledges that the remedy at law for a breach of its obligations under this Agreement will be inadequate
and agrees, in the event of a breach or threatened breach by the Company of the provisions of this Agreement, that the Buyer shall
be entitled, in addition to all other available remedies at law or in equity, and in addition to the penalties assessable herein,
to an injunction or injunctions restraining, preventing or curing any breach of this Agreement and to enforce specifically the
terms and provisions hereof, without the necessity of showing economic loss and without any bond or other security being required.


 



    	20



    	 



    



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


 


 


SUNVALLEY
SOLAR, INC.


 


By:
/s/ Zhijian Zhang


ZHIJIAN
ZHANG


Chief Executive Officer


 


ASHER
ENTERPRISES, INC.


 


 


By: /s/
Curt Kramer


Name:
Curt Kramer


Title:
President


 


1 Linden
Pl., Suite 207


Great
Neck, NY. 11021


 


 


AGGREGATE
SUBSCRIPTION AMOUNT:


 


Aggregate
Principal Amount of Note:$78,500.00


 


Aggregate
Purchase Price:$78,500.00






    	21