SECURITIES PURCHASE AGREEMENT


 


This SECURITIES PURCHASE
AGREEMENT (the “Agreement”), dated as of April 9, 2013, by and between SOUTHERN PRODUCTS, INC., a Nevada
corporation, with headquarters located at 115 East Wilson Street - Unit B, Costa Mesa, CA 92627 (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:


 


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”);


 


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 $42,500.00 (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.


 


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:


 


Purchase and Sale
of Note.


 


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.


 


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 Buyer’s 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. 


 


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 or about April 15, 2013, 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.




    	



    	 



    

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


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.


 


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


 


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.





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.


 


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.




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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.






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.


 


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.


 


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


 


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


 


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.


 


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.




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Capitalization. As of the date
hereof, the authorized capital stock of the Company consists of: (i) 440,000,000 shares of Common Stock, $0.001 par value per
share, of which 111,111,112 shares are issued and outstanding; and (ii) 10,000,000 shares of Preferred Stock, $0.001 par value
per share, of which no shares are issued and outstanding; 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) exercisable for, or convertible
into or exchangeable for shares of Common Stock and 5,750,000 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.


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.


 


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.




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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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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 November 30, 2012, 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.


 


Absence of Certain Changes.
Since November 30, 2012, 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.


 


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.


 


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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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.





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.


 


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.


 


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).


 


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.




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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.





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.


 


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 November 30, 2012, 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.


 


Environmental
Matters.


 


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.


 


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.


 


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.




    	9



    	 



    

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.


 


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.


 


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.


 


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.


 


Solvency. The Company
(after giving effect to the transactions contemplated by this Agreement) is solvent (i.e., its assets have a fair market
value in excess of the amount required to pay its probable liabilities on its existing debts as they become absolute and matured)
and currently the Company has no information that would lead it to reasonably conclude that the Company would not, after giving
effect to the transaction contemplated by this Agreement, have the ability to, nor does it intend to take any action that would
impair its ability to, pay its debts from time to time incurred in connection therewith as such debts mature. The Company did not
receive a qualified opinion from its auditors with respect to its most recent fiscal year end and, after giving effect to the transactions
contemplated by this Agreement, does not anticipate or know of any basis upon which its auditors might issue a qualified opinion
in respect of its current fiscal year.


 


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.


 


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.




    	10



    	 



    

COVENANTS.


 


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.


 


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.


 


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


 


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.


 


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 $2,500.




    	11



    	 



    

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.


 


[INTENTIONALLY
DELETED]


 


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.


 


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.


 


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.


 


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.


 


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.


 


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.




    	12



    	 



    

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.


 


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:


 


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


 


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


 


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.




    	13



    	 



    

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.





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:





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


 


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.


 


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.


 


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.


 


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.


 


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.


 


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.


 


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




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Governing Law; Miscellaneous.


 


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.


 


Counterparts. 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.


 


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.


 


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.


 


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. 


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:



    	15



    	 



    









	If to the Company, to: 
	SOUTHERN PRODUCTS, INC.
	115 East Wilson Street - Unit B
	Costa Mesa, CA 92627
	Attn: EDWARD MEADOWS, Chief Executive Officer
	facsimile: [enter fax number]
	 
	With a copy by fax only to (which copy shall not constitute notice): 
	Kyleen Cane
	Cane•Clark LLP
	3273 E. Warm Springs Rd.
	Las Vegas, NV 89120
	 
	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
	Great Neck, NY 11021
	Attn: Bernard S. Feldman, Esq.
	facsimile: 516-466-3555


 


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


 


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.


 


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.


 


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.




    	16



    	 



    

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).


 


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.


 


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.


 


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.


 


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


 


 


	SOUTHERN PRODUCTS, INC.
	 
	By:
    /s/ Edward Meadows
	Chief Executive Officer 
	 
	ASHER ENTERPRISES, INC.
	 
	By:
    /s/ Curt Kramer 
	Title: President
	1 Linden Pl., Suite 207
	Great Neck, NY. 11021


 


	AGGREGATE SUBSCRIPTION AMOUNT:	 
	Aggregate Principal Amount of Note:	$42,500.00
	Aggregate Purchase Price:	$42,500.00


 



    	17