Document:

f8k050313a2ex4i_codesmart.htm

 

 

Exhibit 4.1

 

NEITHER THIS NOTE NOR THE SECURITIES THAT ARE ISSUABLE UPON CONVERSION HEREOF OR UPON EXCHANGE HEREUNDER (COLLECTIVELY, THE “SECURITIES”) HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “1933 ACT”), OR THE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION. NEITHER THE SECURITIES NOR ANY INTEREST OR PARTICIPATION THEREIN MAY BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED: (I) IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE 1933 ACT OR APPLICABLE STATE SECURITIES LAWS; OR (II) IN THE ABSENCE OF AN OPINION OF COUNSEL, IN A FORM ACCEPTABLE TO THE ISSUER, THAT REGISTRATION IS NOT REQUIRED UNDER THE 1933 ACT OR; (III) UNLESS SOLD, TRANSFERRED OR ASSIGNED PURSUANT TO RULE 144 UNDER THE 1933 ACT.

 

SECURED CONVERTIBLE PROMISSORY NOTE

 

	
___________

	
US$_______

 

FOR VALUE RECEIVED, The CodeSmart Group, Inc., a corporation incorporated under the laws of the State of Nevada and located at 103 Waters Edge Congers, NY 10920 (the “Company”), hereby promises to pay to the order of ___________________located at _____________________or their successors or assigns (the “Holder”), the principal amount of ______________________United States Dollars (US$______________) on or prior to 90 days after the issuance of this Note (the “Maturity Date”), in accordance with the terms hereof. This Secured Convertible Promissory Note (this note, and all notifications, extensions, future advances, supplements, and renewals thereof, and any substitutions there for, hereinafter referred to as the “Note”) was issued pursuant to the Subscription Agreement, dated as of the even date hereof (the “Subscription Agreement”), entered into by and between the Company and the Holder. Capitalized terms not otherwise defined herein shall have the meanings ascribed to them in the Subscription Agreement.

 

1.        Payments of Principal and Interest.

 

(a)        Payment of Principal. The principal amount of this Note shall be paid to the Holder on or prior to the Maturity Date.

 

(b)        Payment of Interest. The Company further promises to pay interest in cash on the unpaid principal amount of this Note at a rate per annum equal to ten percent (10%), commencing to accrue on the date hereof and payable on the Maturity Date or earlier prepayment or conversion as provided herein. Interest will be computed on the basis of a 360-day year of twelve 30-day months for the actual number of days elapsed.

 

(c)        General Payment Provisions. So long as a Holder or any of its nominees shall be the holder of any Note, and notwithstanding anything contained elsewhere in this Note to the contrary, all sums of principal, interest or otherwise becoming due on this Note shall be made in lawful money of the United States of America by certified bank check or wire transfer to such account as the Holder may designate by written notice to the Company no later than 3:00 p.m. New York time, on the date such payment is due, without the presentation or surrender of such Note or the making of any notation thereon. Any payment made after 3:00 p.m. New York time, on a Business Day will be deemed made on the next following Business Day. Whenever any amount expressed to be due by the terms of this Note is due on any day which is not a Business Day, the same shall instead be due on the next succeeding Business Day, and interest shall be payable on any principal so extended for the period of such extension. All amounts payable under this Note shall be paid free and clear of, and without reduction by reason of, any deduction, set-off or counterclaim. The Company will afford the benefits of this Section to the Holder and to each other Person holding this Note. For purposes of this Note, “Business Day” shall mean any day other than a Saturday, Sunday or a day on which commercial banks in the State of New York are authorized or required by law or executive order to remain closed.

 

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(d)        Optional Prepayment. At any time prior to the Maturity Date, the Company may pre-pay this Note without penalty and, upon such prepayment in full, the Holder shall have no further rights under this Note, including no rights of conversion.

 

2.         Conversion of Note.

 

(a)        Optional Conversion. Subject to the consummation of a PIPE (as defined below), the Holder shall have the right from time to time, and at any time and as long as there remains outstanding principal or interest of this Note, to convert all or any portion of the outstanding and unpaid principal and interest of this Note into fully paid and non- assessable shares of Common Stock of the Company, as such Common Stock exists on the Issuance Date, or any shares of capital stock or other securities of the Company into which such Common Stock shall hereafter be changed or reclassified at the conversion price determined as provided herein (a “Conversion”). The number of shares that shall be issuable upon conversion of this Note (the “Conversion Shares”) shall equal the number obtained by dividing (x) the outstanding principal amount of this Note plus accrued and unpaid interest thereon, by (y) the Conversion Price. The “Conversion Price,” subject to adjustments as provided in Section 3 hereof, shall equal 100% of the per share purchase price of the securities offered in the PIPE if they are common stock, or the conversion or exercise price if they are securities which are convertible into or exercisable for common stock of the Pubco (“PIPE Securities,” such per share price of PIPE Securities referred to as “PIPE Securities Price”). “PIPE” shall mean the first sale of the securities of the publicly traded company with which the Company consummates the Merger (as defined in the Subscription Agreement) with a publically traded company (the “Pubco”) for cash after the issuance of this Note. The Company shall, within five (5) Business Days of the consummation of the PIPE, provide a written notice to Holder, setting forth the PIPE Securities Price. In the event the PIPE is never consummated as long as the Note is outstanding, the Holder shall not have the right to convert hereunder.

 

(b)        Mechanics of Holders Conversion. The conversion of this Note shall be conducted in the following manner:

 

(i)        Subject to Section 2(a) hereof, this Note may be converted by the Holder in whole or in part at any time from time to time after the Issuance Date, by (A) submitting to the Company a Notice of Conversion in the form of Exhibit A (by facsimile, e-mail or other reasonable means of communication dispatched on the Conversion Date prior to 6:00 p.m., New York, New York time) and (B) surrendering this Note at the principal office of the Company. Notwithstanding anything to the contrary set forth herein, upon conversion of this Note in accordance with the terms hereof, the Holder shall not be required to physically surrender this Note to the Company unless the entire unpaid principal amount of this Note is so converted. The Holder and the Company shall maintain records showing the principal amount so converted and the dates of such conversions or shall use such other method, reasonably satisfactory to the Holder and the Company, so as not to require physical surrender of this Note upon each such conversion. In the event of any dispute or discrepancy, such records of the Company shall, primafacie, be controlling and determinative in the absence of manifest error. Notwithstanding the foregoing, if any portion of this Note is converted as aforesaid, the Holder may not transfer this Note unless the Holder first physically surrenders this Note to the Company, whereupon the Company will forthwith issue and deliver upon the order of the Holder a new Note of like tenor, registered as the Holder (upon payment by the Holder of any applicable transfer taxes) may request, representing in the aggregate the remaining unpaid principal amount of this Note. The Holder and any assignee, by acceptance of this Note, acknowledge and agree that, by reason of the provisions of this paragraph, following conversion of a portion of this Note, the unpaid and unconverted principal and interest of this Note represented by this Note may be less than the amount stated on the face hereof. At such time as such conversion has been effected, the rights of the Holder of this Note as the Holder of such Note shall cease (with respect to the amount so converted), and the Person or Persons in whose name or names any certificate or certificates for the Common Stock are to be issued upon such conversion shall be deemed to have become the holder or holders of record of the Common Stock represented thereby.

 

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(ii)       As soon as possible after the conversion has been effected (but in any event within five (5) Business Days), the Company or acquirer shall deliver to the converting holder a certificate or certificates representing the Conversion Shares issuable by reason of such conversion in such name or names and such denomination or denominations as the converting holder has specified.

 

(iii)      No fraction of shares or scrip representing fractions of shares will be issued on conversion. Upon any conversion of the entire outstanding principal of and interest on this Note, the number of shares or other securities issuable shall be rounded to the nearest whole number.

 

(iv)      The issuance of certificates for Conversion Shares upon conversion of this Note shall be made without charge to the holder hereof in respect thereof or other cost incurred by the Company or acquirer in connection with such conversion and the related issuance of Conversion Shares.

 

(v)       Neither the Company nor acquirer shall close its books against the transfer of this Note in any manner which interferes with the timely conversion of this Note. The Company shall assist and cooperate with any holder of this Note required to make any governmental filings or obtain any governmental approval prior to or in connection with the conversion of this Note (including, without limitation, making any filings required to be made by the Company).

 

(vi)      The Company or its acquirer shall at all times reserve and keep available out of its authorized but unissued shares of the common stock, solely for the purpose of issuance upon conversion hereunder, such number of shares of other type of capital securities of the Company or its acquirer issuable upon conversion. All Conversion Shares which are so issuable shall, when issued, be duly authorized and validly issued, fully paid and non-assessable and free from all taxes, liens and charges. The Company or its acquirer shall take all such actions as may be necessary to assure that all such Conversion Shares may be so issued without violation of any applicable law or governmental regulation or any requirements of any domestic securities exchange upon which such shares of capital stock are quoted.

 

(c)        The Holder’s Conversion Limitations. The Company shall not affect any conversion of this Note, and the Holder shall not have the right to convert any portion of this Note, to the extent that after giving effect to the conversion set forth on the Conversion Notice submitted by the Holder, the Holder (together with the Holder’s affiliates (as defined herein) and any Persons acting as a group together with the Holder or any of the Holder’s affiliates) would beneficially own in excess of the Beneficial Ownership Limitation (as defined herein). To ensure compliance with this restriction, the Holder will be deemed to represent to the Company each time it delivers a Conversion Notice that such Conversion Notice has not violated the restrictions set forth in this Section 2 and the Company shall have no obligation to verify or confirm the accuracy of such determination. The restriction described in this paragraph may be waived, in whole or in part, upon sixty-one (61) days’ prior notice from the Holder to the Company to increase such percentage.

 

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For purposes of this Note, the “Beneficial Ownership Limitation” shall be 4.99% of the number of shares of Common Stock outstanding immediately after giving effect to the issuance of shares of Common Stock issuable upon conversion of this Note. The limitations contained in this paragraph shall apply to a successor holder of this Note. For purposes of this Note, “Person” means an individual, a limited liability company, a partnership, a joint venture, a corporation, a trust, an unincorporated organization or a government or any department or agency thereof.

 

3.        Adjustment to the Conversion Price. If at any time or from time to time after the Issuance Date and prior to the Maturity Date, the Company takes action with respect to any of the following, the Conversion Price and kind of shares or other securities to be issued upon conversion shall be adjusted pursuant to this Section 3:

 

(a)       Stock Splits, Combinations and Dividends. If the shares of Common Stock outstanding at any time after the date hereof are subdivided or combined into a greater or smaller number of shares of Common Stock, or if a dividend is paid on the Common Stock in shares of Common Stock, the Conversion Price or the Conversion Shares to be issued, as the case may be, shall be proportionately reduced in case of subdivision of shares or stock dividend or proportionately increased in the case of combination of shares, in each such case by the ratio which the total number of shares of Common Stock outstanding immediately after such event bears to the total number of shares of Common Stock outstanding immediately prior to such event.

 

(b)        Merger, Sale, Reclassification, Exchange and Substitution.

 

	
(i)

	  	
In case the Company within two years after the Issuance Date shall do any of the following (each, a “Triggering Event”): (a) consolidate or merge with or into any other Person and the Company shall not be the continuing or surviving Company of such consolidation or merger, or (b) permit any other Person to consolidate with or merge into the Company and the Company shall be the continuing or surviving Person but, in connection with such consolidation or merger, any securities of the Company shall be changed into or exchanged for securities of any other Person or cash or any other property, or (c) transfer all or substantially all of its properties or assets to any other Person, or (d) effect a capital reorganization or reclassification of its securities, then, and in the case of each such Triggering Event, proper provision shall be made to the Conversion Price so that, upon the basis and the terms and in the manner provided herein, the Holder shall be entitled upon the conversion hereof at any time after the consummation of such Triggering Event, to the extent the Note has not been converted or redeemed prior to such Triggering Event, to receive at the Conversion Price in effect at the time immediately prior to the consummation of such Triggering Event, in lieu of the Common Stock issuable upon such conversion prior to such Triggering Event, the securities, cash and property to which such Holder would have been entitled upon the consummation of such Triggering Event if such Holder had converted immediately prior thereto (including the right of a shareholder to elect the type of consideration it will receive upon a Triggering Event), subject to adjustments (subsequent to such corporate action) as nearly equivalent as possible to the adjustments provided for elsewhere in this Section 3. Promptly upon the occurrence of a Triggering Event, the Company shall notify the Holder in writing of such Triggering Event and provide the calculations in determining the number of shares of Common Stock issuable upon conversion and the adjusted Conversion Price.

 

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(ii)

	  	
The surviving entity and/or each Person (other than the Company) which may be required to deliver any securities, cash or property upon the conversion of the Note as provided herein shall assume, by written instrument delivered to, and reasonably satisfactory to, the Holder, (A) the obligations of the Company under this Note (and if the Company shall survive the consummation of such Triggering Event, such assumption shall be in addition to, and shall not release the Company from, any continuing obligations of the Company under this Note) and (B) the obligation to deliver to such holder such securities, cash or property as, in accordance with the foregoing provisions of this subsection (b).

	
 

	
(iii)

	  	
Upon any liquidation, dissolution or winding up of the Company, the Common Stock issuable upon the conversion of the Note is changed into the same or a different number of shares of any class of stock, whether by recapitalization, reclassification or otherwise (other than a subdivision or combination of shares provided for above), then, in any such event, each Holder shall have the right thereafter to convert the Note into the kind and amount of stock and other securities and property receivable upon the recapitalization, reclassification or other change by a holder of the number of shares of Common Stock into which the shares of this Note could have been converted immediately prior to the recapitalization, reclassification or change.

	
 

(c)        Dilutive Issuance.

 

If, at any time when any Notes are issued and outstanding, the Company issues or sells, or in accordance with this Section 3 is deemed to have issued or sold, any shares of Common Stock for no consideration or for a consideration per share (before deduction of reasonable expenses or commissions or underwriting discounts or allowances in connection therewith) less than the Conversion Price in effect on the date of such issuance (or deemed issuance) of such shares of Common Stock (a “Dilutive Issuance”), then immediately upon the Dilutive Issuance, the Conversion Price will be reduced to the amount of the consideration per share received by the Company in such Dilutive Issuance.

 

The Company shall be deemed to have issued or sold shares of Common Stock if the Company in any manner issues or grants any warrants, rights or options (not including Excepted Issuances as defined herein), whether or not immediately exercisable, to subscribe for or to purchase Common Stock or other securities convertible into or exchangeable for Common Stock (“Convertible Securities”) (such warrants, rights and options to purchase Common Stock or Convertible Securities are hereinafter referred to as “Options”) and the price per share for which Common Stock is issuable upon the exercise of such Options is less than the Conversion Price then in effect, then the Conversion Price shall be equal to such price per share. For purposes of the preceding sentence, the “price per share for which Common Stock is issuable upon the exercise of such Options” is determined by dividing (i) the total amount, if any, received or receivable by the Company as consideration for the issuance or granting of all such Options, plus the minimum aggregate amount of additional consideration, if any, payable to the Company upon the exercise of all such Options, plus, in the case of Convertible Securities issuable upon the exercise of such Options, the minimum aggregate amount of additional consideration payable upon the conversion or exchange thereof at the time such Convertible Securities first become convertible or exchangeable, by (ii) the maximum total number of shares of Common Stock issuable upon the exercise of all such Options (assuming full conversion of Convertible Securities, if applicable). No further adjustment to the Conversion Price will be made upon the actual issuance of such Common Stock upon the exercise of such Options or upon the conversion or exchange of Convertible Securities issuable upon exercise of such Options. “Excepted Issuances” means (i) full or partial consideration in connection with a strategic merger, acquisition, consolidation or purchase of substantially all of the securities or assets of a corporation or other entity, so long as such issuances are not for the purpose of raising capital and which holders of such securities or debt are not at any time granted registration rights, (ii) the Company’s issuance of securities in connection with strategic license agreements and other partnering arrangements, so long as such issuances are not for the purpose of raising capital and which holders of such securities or debt are not at any time granted registration rights, (iii) the Company’s issuance of Common Stock or the issuances or grants of options to purchase Common Stock to employees, directors, and consultants, pursuant to employee stock and option plans, and (iv) securities upon the exercise or exchange of or conversion of any securities exercisable or exchangeable for or convertible into shares of Common Stock issued and outstanding on the date of this Agreement.

 

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Additionally, the Company shall be deemed to have issued or sold shares of Common Stock if the Company in any manner issues or sells any Convertible Securities, whether or not immediately convertible (other than where the same are issuable upon the exercise of Options), and the price per share for which Common Stock is issuable upon such conversion or exchange is less than the Conversion Price then in effect, then the Conversion Price shall be equal to such price per share. For the purposes of the preceding sentence, the “price per share for which Common Stock is issuable upon such conversion or exchange” is determined by dividing (i) the total amount, if any, received or receivable by the Company as consideration for the issuance or sale of all such Convertible Securities, plus the minimum aggregate amount of additional consideration, if any, payable to the Company upon the conversion or exchange thereof at the time such Convertible Securities first become convertible or exchangeable, by (ii) the maximum total number of shares of Common Stock issuable upon the conversion or exchange of all such Convertible Securities. No further adjustment to the Conversion Price will be made upon the actual issuance of such Common Stock upon conversion or exchange of such Convertible Securities.

 

4.        Exchange for PIPE Securities.

 

(a)        In lieu of the right of conversion as provided in Section 2 hereof, the Holder shall have the right, after the consummation of the PIPE and as long as there remains any unpaid principal or interest of the Note, to exchange this Note (with any and all then outstanding principal and interest) for the number of PIPE Securities at the Conversion Price.

 

(b)       The Holder may exchange this Note for PIPE Securities pursuant to Section 4(a) hereof by: (A) submitting to the Company a Notice of Exchange indicating its intention to exchange under this Section 3 (by facsimile, e-mail or other reasonable means of communication dispatched on the Conversion Date prior to 6:00 p.m., New York, New York time) and (B) surrendering this Note at the principal office of the Company.

 

(c)       As soon as possible after the exchange has been effected (but in any event within five (5) Business Days), the Company or acquirer shall deliver to the exchanging holder a certificate or certificates representing the exchanged PIPE Securities issuable by reason of such exchange in such name or names and such denomination or denominations as the exchanging holder has specified.

 

(d)       The issuance of certificates for exchanged PIPE Securities upon Holder’s election to exchange this Note shall be made without charge to the holder hereof in respect thereof or other cost incurred by the Company or acquirer in connection with such conversion and the related issuance of exchanged PIPE Securities.

 

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(e)       Neither the Company nor acquirer shall close its books against the transfer of this Note in any manner which interferes with the timely exchange of this Note for the PIPE Securities. The Company and its acquirer shall assist and cooperate with any holder of this Note required to make any governmental filings or obtain any governmental approval prior to or in connection with the exchange of this Note for the PIPE Securities (including, without limitation, making any filings required to be made by the Company).

 

5.        Seniority; Additional Issuances of Debt and Equity.

 

(a)      Except as set forth on Schedule 5, this Note has a first priority security interest in the collateral as more fully described in the Security Agreement. This Note is senior to all other debt of the Company, whether now or hereinafter existing, and ranks ranks paripassu with all other Notes now or hereinafter issued pursuant to the Subscription Agreement, except as otherwise set forth on Schedule 5.

 

(b)      Except for those amounts of indebtedness set forth in Schedule 5 as being senior to, or paripassu with, the Notes (the “Existing Indebtedness”), no indebtedness of the Company is senior to, or paripassu with, this Note in right of payment, whether with respect to interest, damages or upon liquidation or dissolution or otherwise. Other than the Existing Indebtedness and any renewal or refinancing thereof that does not exceed the aggregate amount of the Existing Indebtedness and the borrowing availability under the related credit or loan agreements on the date hereof, the Company will not, and will not permit any Subsidiary to, directly or indirectly, enter into, create, incur, assume or suffer to exist any indebtedness of any kind, that is senior or paripassu in any respect to the Company’s obligations under the Notes, other than any indebtedness secured by purchase money security interests (which will be senior only as to the underlying assets covered thereby) and indebtedness under capital lease obligations (which will be senior only as to the assets covered thereby); and the Company will not, and will not permit any of its subsidiary to, directly or indirectly, incur any Lien on or with respect to any of its property or assets now owned or hereafter acquired or any interest therein or any income or profits there from.

 

6.       Transfer, Exchange and Replacement.

 

(a)      Transfer. This Note has not been and is not being registered under the provisions of the Act or any state securities laws and this Note may not be transferred prior to the end of the holding period applicable to sales under Rule 144 unless in accordance with applicable law and unless (1) the transferee is an “accredited investor” (as defined in Regulation D under the Securities Act) and (2) the holder shall have delivered to the Company an opinion of counsel, reasonably satisfactory in form, scope and substance to the Company, to the effect that this Note may be sold or transferred without registration under the Act. Prior to any such transfer, such transferee shall have represented in writing to the Company that such transferee has requested and received from the Company all information relating to the business, properties, operations, condition (financial or other), results of operations or prospects of the Company deemed relevant by such transferee, and that such transferee has been afforded the opportunity to ask questions of the Company concerning the foregoing. Upon surrender of any Note for registration of transfer or for exchange to the Company at its principal office, the Company at its sole expense will execute and deliver in exchange there is for a new Note or Notes, as the case may be, as requested by the holder or transferee, which aggregate principal amount is equal the unpaid principal amount of such Note, registered as such holder or transferee may request, dated so that there will be no loss of interest on the Note and otherwise of like tenor; provided that this Note may not be transferred by Holder to any Person other than Holder’s affiliates without the prior written consent of the Company (which consent shall not be unreasonably withheld or delayed). The issuance of new Notes shall be made without charge to the holder(s) of the surrendered Note for any issuance tax in respect thereof or other cost incurred by the Company in connection with such issuance, provided that each holder of the Note shall pay any transfer taxes associated therewith. The Company shall be entitled to regard the registered holder of this Note as the holder of the Note so registered for all purposes until the Company or its agent, as applicable, is required to record a transfer of this Note on its register.

 

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(b)      Replacement. Upon notice to the Company of the loss, theft, destruction or mutilation of this Note, and, in the case of loss, theft or destruction, of an indemnification undertaking by the Holder to the Company in a form reasonably acceptable to the Company and, in the case of mutilation, upon surrender and cancellation of the Note, the Company shall execute and deliver a new Note of like tenor and date and in substantially the same form as this Note; provided, however, the Company shall not be obligated to re-issue a Note if the Holder contemporaneously requests the Company to convert such remaining principal amount and interest into Common Stock.

 

7.       Negative Covenants. So long as this Note shall remain in effect and until any outstanding principal and interest and all fees and all other expenses or amounts payable under this Note and the Subscription Agreement have been paid in full, unless all Holders shall otherwise consent in writing, the Company shall not:

 

(a)     Senior or PariPassu Indebtedness. Incur, create, assume, guaranty or permit to exist any indebtedness that ranks senior in priority to the obligations under this Note and the Subscription Agreement, except for (i) indebtedness secured by a lien described in Section 6(b)(ix) below in an aggregate amount outstanding not to exceed $50,000; (ii) indebtedness created as a result of a subsequent financing if the gross proceeds to the Company of such financing are equal to or greater than the aggregate principal amount of the Notes and the Notes are repaid in full upon the closing of such financing; and (iii) any indebtedness issued in the PIPE offering (including upon conversion of the Notes).

 

(b)     Liens. Create, incur, assume or permit to exist any lien on any property or assets (including stock or other securities of the Company) now owned or hereafter acquired by it or on any income or revenues or rights in respect of any thereof, except:

 

(i)        any lien created under this Note or the Subscription Agreement;

 

(ii)       any lien created in connection with securities issued in the PIPE;

 

(iii)       any lien existing on any property or asset prior to the acquisition thereof by the Company, provided that

 

1)        such lien is not created in contemplation of or in connection with such acquisition and

 

2)        such lien does not apply to any other property or assets of the Company;

 

(iv)       liens for taxes, assessments and governmental charges;

 

(v)       carriers’, warehousemen’s, mechanics’, material men’s, repairmen’s, landlord’s or other like liens arising in the ordinary course of business and securing obligations that are not due and payable;

 

(vi)      pledges and deposits made in the ordinary course of business in compliance, with workmen’s compensation, unemployment insurance and other social security laws or regulations;

 

(vii)     deposits to secure the performance of bids, trade contracts (other than for indebtedness), leases, statutory obligations, surety and appeal bonds, performance bonds and other obligations of a like nature incurred in the ordinary course of business;

 

(viii)    zoning restrictions, easements, licenses, covenants, conditions, rights-of-way, restrictions on use of real property and other similar encumbrances incurred in the ordinary course of business and minor irregularities of title that, in the aggregate, are not substantial in amount and do not materially detract from the value of the property subject thereto or interfere with the ordinary conduct of the business of the Company;

 

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(ix)        purchase money security interests in real property, improvements thereto or equipment hereafter acquired (or, in the case of improvements, constructed) by the Company, provided that

 

1)        such security interests secure indebtedness permitted by this Note,

 

2)        such security interests are incurred, and the indebtedness secured thereby is created, within 90 days after such acquisition (or construction),

 

3)        the indebtedness secured thereby does not exceed 85% of the lesser of the cost or the fair market value of such real property, improvements or equipment at the time of such acquisition (or construction) and

 

4)        such security interests do not apply to any other property or assets of the Company;

 

(x)        liens arising out of judgments or awards (other than any judgment that constitutes an Event of Default hereunder) in respect of which the Company shall in good faith be prosecuting an appeal or proceedings for review and in respect of which it shall have secured a subsisting stay of execution pending such appeal or proceedings for review, provided the Company shall have set aside on its books adequate reserves with respect to such judgment or award; and

 

(xi)       deposits, liens or pledges to secure payments of workmen’s compensation and other payments, public liability, unemployment and other insurance, old-age pensions or other social security obligations, or the performance of bids, tenders, leases, contracts (other than contracts for the payment of money), public or statutory obligations, surety, stay or appeal bonds, or other similar obligations arising in the ordinary course of business.

 

(c)       Dividends and Distributions. In the case of the Company, declare or pay, directly or indirectly, any dividend or make any other distribution (by reduction of capital or otherwise), whether in cash, property, securities or a combination thereof, with respect to any shares of its capital stock or directly or indirectly redeem, purchase, retire or otherwise acquire for value any shares of any class of its capital stock or set aside any amount for any such purpose.

 

(d)       Limitation on Certain Payments and Prepayments.

 

(i)        Pay in cash any amount in respect of any indebtedness or preferred stock that may at the obligor’s option be paid in kind or in other securities; or

 

(ii)       Optionally prepay, repurchase or redeem or otherwise defease or segregate funds with respect to any indebtedness of the Company, other than for indebtedness under this Note or the Subscription Agreement.

 

8.        Defaults and Remedies.

 

(a)      Events of Default. An “Event of Default” means:

 

(i)       failure by the Company to pay any principal amount or interest due hereunder within five (5) days of the date such payment is due;

 

(ii)      failure by the Company to consummate the Merger prior to May 15, 2013 with a publicly traded company that is reasonable acceptable to the Company;

 

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(iii)      failure by the Pubco to issue to the Holder the Conversion Shares issuable to the Holder as a result of the conversion of this Note within five (5) business days after the Conversion Date;

 

(iv)     failure by the Pubco to issue to the Holder the exchanged PIPE Securities within five (5) business days after the Holder provides a request to exchange;

 

(v)     any event of default by the Company or any subsidiary under the Security Agreement shall have occurred and be continuing, or the Security Agreement shall fail to remain in full force and effect prior to payment in full or conversion (as applicable) of all amounts payable under this Note, or any action shall be taken by the Company to discontinue the Security Agreement or to assert the invalidity thereof prior to payment in full or conversion (as applicable) of all amounts payable under this Note;

 

(vi)     the Company shall: (1) make a general assignment for the benefit of its creditors; (2) apply for or consent to the appointment of a receiver, trustee, assignee, custodian, sequestrator, liquidator or similar official for itself or any of its assets and properties; (3) commence a voluntary case for relief as a debtor under the United States Bankruptcy Code; (4) file with or otherwise submit to any governmental authority any petition, answer or other document seeking: (A) reorganization, (B) an arrangement with creditors or (C) to take advantage of any other present or future applicable law respecting bankruptcy, reorganization, insolvency, readjustment of debts, relief of debtors, dissolution or liquidation; (5) file or otherwise submit any answer or other document admitting or failing to contest the material allegations of a petition or other document filed or otherwise submitted against it in any proceeding under any such applicable law, or (6) be adjudicated a bankrupt or insolvent by a court of competent jurisdiction;

 

(vii)    any case, proceeding or other action shall be commenced against the Company for the purpose of effecting, or an order, judgment or decree shall be entered by any court of competent jurisdiction approving (in whole or in part) anything specified in Section 3.01(e) hereof, or any receiver, trustee, assignee, custodian, sequestrator, liquidator or other official shall be appointed with respect to the Company, or shall be appointed to take or shall otherwise acquire possession or control of all or a substantial part of the assets and properties of the Company, and any of the foregoing shall continue unstayed and in effect for any period of sixty (60) days;

 

(viii)   default shall occur with respect to any indebtedness for borrowed money of the Company (including, without limitation, any other Note(s)) or under any agreement under which such indebtedness may be issued by the Company and such default shall continue for more than the period of grace, if any, therein specified, if the aggregate amount of such indebtedness for which such default shall have occurred exceeds $25,000;

 

(ix)     default shall occur with respect to any contractual obligation of the Company under or pursuant to any contract, lease, or other agreement to which the Company is a party and such default shall continue for more than the period of grace, if any, therein specified, if the aggregate amount of the Company’s contractual liability arising out of such default exceeds or is reasonably estimated to exceed $25,000;

 

(x)       final judgment for the payment of money in excess of $25,000 shall be rendered against the Company and the same shall remain undischarged for a period of twenty (20) days during which execution shall not be effectively stayed;

 

(xi)      any event of default of the Company under any agreement, note, mortgage, security agreement or other instrument evidencing or securing indebtedness that ranks senior in priority to, or paripassu with, the obligations under this Note and the Subscription Agreement;

 

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(xii)     any material breach by the Company of any of its representations or warranties under the Subscription Agreement; or

 

(xiii)    any default, whether in whole or in part, shall occur in the due observance or performance of any obligations or other covenants, terms or provisions to be performed under this Note or the Subscription Agreement which is not cured by the Company within five (5) business days after receipt of written notice thereof.

 

(b)       Remedies. If any Event of Default occurs, then the full principal amount of this Note, together with any other amounts owing in respect thereof, to the date of the Event of Default, shall become immediately due and payable without any action on the part of the Holder, and if any other Event of Default occurs, the full principal amount of this Note, together with any other amounts owing in respect thereof, (together with all reasonable attorneys’ fees, paralegals’ fees and costs and expenses incurred by the Holder in collecting or enforcing payment thereof (whether such fees, costs or expenses are incurred in negotiations, all trial and appellate levels, administrative proceedings, bankruptcy proceedings or otherwise)) to the date of acceleration shall become, at the Holder’s election, immediately due and payable in cash. Commencing five (5) days after the occurrence of any Event of Default that results in the eventual acceleration of this Note, interest on this Note shall begin to accrue at the rate of interest specified in Section 1.01(b) PLUS five percent (5%) per annum, or such lower maximum amount of interest permitted to be charged under applicable law. All Notes for which the full amount hereunder shall have been paid in accordance herewith shall promptly be surrendered to or as directed by the Company. The Holder need not provide, and the Company hereby waives, any presentment, demand, protest or other notice of any kind, and the Holder may immediately and without expiration of any grace period enforce any and all of its rights and remedies hereunder and all other remedies available to it under applicable law. Such declaration may be rescinded and annulled by the Holder at any time prior to payment hereunder and the Holder shall have all rights as a Note holder until such time, if any, as the full payment under this Section shall have been received by it. No such rescission or annulment shall affect any subsequent Event of Default or impair any right consequent thereon.

 

(c)      Holder Appointed Attorney-in-Fact. The Company hereby irrevocably appoints the Holder as the Company’s attorney-in-fact, with full authority in the name, place and stead of the Company, from time to time in the Holder’s discretion upon the occurrence and during the continuance of an Event of Default to take any action and to execute any document which the Holder may deem necessary or advisable to accomplish the purposes of this Note.

 

9.       Amendment and Waiver. The provisions of this Note may not be modified, amended or waived, and the Company may not take any action herein prohibited, or omit to perform any act herein required to be performed by it, without the written consent of the holders of a majority of the then outstanding principal amount of all similar convertible notes issued in the Company’s offering of Notes; provided, however, that any waiver of any Event of Default shall require the written consent of the holders of not less than 67% of the then outstanding principal amount of all similar convertible notes issued in the Company’s offering of Notes; provided, further, that any amendment to this Note which (i) changes the Interest Rate in Section 1 hereof, (ii) changes the Maturity Date or (iii) adversely affects the Holder’s ability to convert or to refrain from converting this Note in its sole discretion pursuant to Section 2 hereof, must be approved in writing by the holders of 100% of the then outstanding principal amount of all similar convertible notes issued in the Note Issuance (including this Note).

 

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10.       Voting Rights. Upon Conversion into the Common Stock the Holder shall have the voting rights applicable to the Common Stock consistent with the Company’s Articles of Incorporation and By-laws.

 

11.       Investment Representations. This Note has been issued subject to certain investment representations of the original Holder set forth in the Subscription Agreement and may be transferred or exchanged only in compliance with the Subscription Agreement and applicable federal and state securities laws and regulations.

 

12.       Cancellation. After all principal owed on this Note has been paid in full, this Note shall automatically be deemed canceled, shall be surrendered to the Company for cancellation and shall not be re-issued.

 

13.       Waiver of Notice. To the extent permitted by law, the Company hereby waives demand, notice, protest and all other demands and notices in connection with the delivery, acceptance, performance, default or enforcement of this Note.

 

14.       Governing Law. This Note shall be construed and enforced in accordance with, and all questions concerning the construction, validity, interpretation and performance of this Note shall be governed by, the laws of the State of New York, without giving effect to provisions thereof regarding conflict of laws. Each party hereto hereby irrevocably submits to the non-exclusive jurisdiction of the state and federal courts sitting in the State of New York for the adjudication of any dispute hereunder or in connection herewith or with any transaction contemplated hereby or discussed herein, and hereby irrevocably waives, and agrees not to assert in any suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of any such court, that such suit, action or proceeding is brought in an inconvenient forum or that the venue of such suit, action or proceeding is improper. Each party hereto hereby irrevocably waives personal service of process and consents to process being served in any such suit, action or proceeding by sending by certified mail or overnight courier a copy thereof to such party at the address indicated in the preamble hereto 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 manner permitted by law. EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HERE UNDER OR IN CONNECTION HEREWITH OR ARISING OUT OF THIS AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREBY.

 

15.        Indemnity and Expenses. The Company agrees:

 

(a)        To indemnify and hold harmless the Holder and each of its partners, employees, agents and affiliates from and against any and all claims, damages, demands, losses, obligations, judgments and liabilities (including, without limitation, attorneys’ fees and expenses) in any way arising out of or in connection with this Note; and

 

(b)       To pay and reimburse the Holder upon demand for all costs and expenses (including, without limitation, attorneys’ fees and expenses) that the Holder may incur in connection with (i) the exercise or enforcement of any rights or remedies (including, but not limited to, collection) granted hereunder or otherwise available to it (whether at law, in equity or otherwise), or (ii) the failure by the Company to perform or observe any of the provisions hereof. The provisions of this Section shall survive the execution and delivery of this Note, the repayment of any or all of the principal or interest owed pursuant hereto, and the termination of this Note.

 

Initials _________ 

  

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16.        Remedies, Characterizations, Other Obligations, Breaches and Injunctive Relief.

 

The remedies provided in this Note shall be cumulative and in addition to all other remedies available under this Note, at law or in equity.

 

17.        Specific Shall Not Limit General; Construction. No specific provision contained in this Note shall limit or modify any more general provision contained herein. This Note shall be deemed to be jointly drafted by the Company and the Holder and shall not be construed against any person as the drafter hereof.

 

18.        Failure or Indulgence Not Waiver. No failure or delay on the part of this Note in the exercise of any power, right or privilege hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such power, right or privilege preclude other or further exercise thereof or of any other right, power or privilege.

 

19.        Notice. Notice shall be given to each party at the address indicated in the preamble hereto or at such other address as provided to the other party in writing.

 

[-Signature Page Follows-]

 

Initials _________ 

  

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IN WITNESS WHEREOF, the Company has caused this Note to be executed on and as of the Closing Date.

 

	  	
THE CODESMART GROUP, INC.

	  	  	  
	  	
By:

	
/s/ Ira Shapiro

	  	
Name:

	
Ira Shapiro

	  	
Title:

	
Chief Executive Officer

 

[-Signature Page to Secured Convertible Promissory Note-]

 

 

  

14

  

 

EXHIBIT A

 

NOTICE OF CONVERSION

 

The undersigned hereby elects to convert $_________________ principal amount of the Note (defined below) into that number of shares of Common Stock to be issued pursuant to the conversion of the Note (“Common Stock”) as set forth below, of The CodeSmart Group, Inc., a Nevada corporation (the “Company”) according to the conditions of the secured convertible promissory note of the Company dated as of April 10, 2013 (the “Note”), as of the date written below. No fee will be charged to the Holder for any conversion, except for transfer taxes, if any.

 

Box Checked as to applicable instructions:

 

The Company shall electronically transmit the Common Stock issuable pursuant to this Notice of Conversion to the account of the undersigned or its nominee with DTC through its Deposit Withdrawal Agent Commission system (“DWAC Transfer”).

 

Name of DTC Prime Broker:

 

Account Number:

 

The undersigned hereby requests that the Company issue a certificate or certificates for the number of shares of Common Stock set forth below (which numbers are based on the Holder’s calculation attached hereto) in the name(s) specified immediately below or, if additional space is necessary, on an attachment hereto:

 

___________________________

 

___________________________

 

___________________________

 

	
Date of Conversion:

	  	
 ______________________

	  	  	  
	
Applicable Conversion Price:

	  	
 ______________________

	  	  	  
	
Number of Shares of Common Stock to be issued pursuant to Conversion of the Note:

	  	
 _____________________

	  	  	  
	
Amount of Principal due remaining under the Note after this conversion:

	  	
 

 

_______________________

 

HOLDER

 

By:_____________________________

Name:

Title:

Date: __________________________

 

  

15

  

 

Schedule 5

Existing Indebtedness

 

None.

 

 

 

	  	
 

16f8k050313a2ex10i_codesmart.htm

 

Exhibit 10.1

 

SHARE EXCHANGE AGREEMENT

 

This SHARE EXCHANGE AGREEMENT, dated as of May 3, 2013 (the “Agreement”) by and among FIRST INDEPENDENCE CORP., a Florida corporation (“FICF”), THE CODESMART GROUP, INC., a corporation incorporated under the laws of Nevada (“CodeSmart”), and those shareholders of CodeSmart named on the signature pages attached hereto (“CodeSmart Shareholders”).

 

WHEREAS, the authorized capital of FICF consists of 500,000,000 shares of common stock, par value $.0001 per share (the “FICF Common Stock”), with 12,000,000 shares issued and outstanding;

 

WHEREAS, the CodeSmart Shareholders collectively own 68.06% of the total outstanding shares of common stock, par value $.0001 of CodeSmart (“CodeSmart Common Stock”);

 

WHEREAS, the CodeSmart Shareholders believe it is in its best interest to exchange with FICF all of the equity interests of CodeSmart which CodeSmart Shareholders hold for the number of the Common Stock as provided in Section 1.1 herein;

 

WHEREAS, FICF intends to effectuate an 8-for-1 forward split of the FICF Common Stock (the “Forward Split”) immediately after the consummation of this Agreement; and

 

WHEREAS, it the intention of the parties that: (i) said exchange of shares shall qualify as a tax-free reorganization under Section 368(a)(1)(B) of the Internal Revenue Code of 1986, as amended (the “Code”); and (ii) said exchange shall qualify as a transaction in securities exempt from registration or qualification under the Securities Act of 1933, as amended and in effect on the date of this Agreement (the “1933 Act”).

 

NOW, THEREFORE, in consideration of the mutual terms, conditions and other agreements set forth herein, the parties hereto hereby agree as follows:

 

ARTICLE I

 

EXCHANGE OF CODESMART SECURITIES FOR COMMON STOCK

 

Section 1.1    Agreement of CodeSmart Shareholders and FICF to Exchange Common Stock for all equity interests of CodeSmart.    On the Closing Date (as hereinafter defined) and upon the terms and subject to the conditions set forth in this Agreement, CodeSmart Shareholders shall sell, assign, transfer, convey and deliver all of the CodeSmart Common Stock to FICF, and FICF shall accept all of the outstanding CodeSmart Common Stock from CodeSmart Shareholders in exchange for the issuance to the CodeSmart Shareholders a total of 3,062,500 shares of Common Stock.

 

Section 1.2    Closing.    The closing of the exchange to be made pursuant to this Agreement (the “Closing”) shall take place at 10:00 a.m. E.S.T. on the second business day after the conditions to closing set forth in Articles V and VI have been satisfied or waived, or at such other time and date as the parties hereto shall agree in writing (the “Closing Date”), at the offices of Ofsink, LLC, 900 Third Avenue, 5th Floor, New York, New York 10022. At the Closing, CodeSmart Shareholders shall cause FICF to be registered as the shareholder of a total of 3,062,500 shares of the CodeSmart Common Stock representing 68.06% of outstanding shares of CodeSmart Common Stock on the book of CodeSmart. In full consideration and exchange for all equity interests of CodeSmart, FICF shall issue and exchange to CodeSmart Shareholders 3,062,500 shares of the Common Stock as set forth on Exhibit A.

 

  

1

  

 

Section 1.3    Tax Treatment.    The exchange described herein is intended to comply with Section 368(a)(1)(B) of the Code, and all applicable regulations thereunder. In order to ensure compliance with said provisions, the parties agree to take whatever steps may be necessary, including, but not limited to, the amendment of this Agreement.

 

ARTICLE II

 

REPRESENTATIONS AND WARRANTIES OF U.S. CO

 

FICF hereby represents, warrants and agrees as follows:

 

Section 2.1    Corporate Organization.    FICF is a corporation duly organized, validly existing and in good standing under the laws of Florida, and has all requisite corporate power and authority to own its properties and assets and to conduct its business as now conducted and is duly qualified to do business in good standing in each jurisdiction in which the nature of the business conducted by FICF or the ownership or leasing of its properties makes such qualification and being in good standing necessary, except where the failure to be so qualified and in good standing will not have a material adverse effect on the business, operations, properties, assets, condition or results of operation of FICF (a “U.S. Material Adverse Effect”);

 

Section 2.2    Capitalization of FICF.    The authorized capital stock of FICF consists of 500,000,000 shares of Common Stock and 100,000,000 shares of preferred stock, par value $.0001 per share (“Preferred Stock”). Of such authorized capital, 12,000,000 shares of Common Stock and no Preferred Stock are issued and outstanding as of the date hereof. All of the Common Stock to be issued pursuant to this Agreement have been duly authorized and will be validly issued, fully paid and non-assessable and no personal liability will attach to the ownership thereof. As of the date of this Agreement there are and as of the Closing Date, there will be, no outstanding options, warrants, agreements, commitments, conversion rights, preemptive rights or other rights to subscribe for, purchase or otherwise acquire any shares of capital stock or any un-issued or treasury shares of capital stock of FICF, except for the Common Stock to be issued pursuant to this Agreement.

 

Section 2.3    Subsidiaries and Equity Investments.    FICF does not own any subsidiaries or equity interest in corporations, partnerships or joint ventures except as set forth on Schedule 2.3.

 

Section 2.4    Authorization and Validity of Agreements.    FICF has all corporate power and authority to execute and deliver this Agreement, to perform its obligations hereunder and to consummate the transactions contemplated hereby. The execution and delivery of this Agreement by FICF and the consummation by FICF of the transactions contemplated hereby have been duly authorized by all necessary corporate action of FICF, and no other corporate proceedings on the part of FICF are necessary to authorize this Agreement or to consummate the transactions contemplated hereby.

 

  

2

  

 

Section 2.5    No Conflict or Violation.    The execution, delivery and performance of this Agreement by FICF does not and will not violate or conflict with any provision of its Articles of Incorporation or By-laws, and does not and will not violate any provision of law, or any order, judgment or decree of any court or other governmental or regulatory authority, nor violate or result in a breach of or constitute (with due notice or lapse of time or both) a default under, or give to any other entity any right of termination, amendment, acceleration or cancellation of, any contract, lease, loan agreement, mortgage, security agreement, trust indenture or other agreement or instrument to which FICF is a party or by which it is bound or to which any of their respective properties or assets is subject, nor will it result in the creation or imposition of any lien, charge or encumbrance of any kind whatsoever upon any of the properties or assets of FICF, nor will it result in the cancellation, modification, revocation or suspension of any of the licenses, franchises, permits to which FICF is bound.

 

Section 2.6    Consents and Approvals.    No consent, waiver, authorization or approval of any governmental or regulatory authority, domestic or foreign, or of any other person, firm or corporation, is required in connection with the execution and delivery of this Agreement by FICF or performance by FICF of its obligations hereunder.

 

Section 2.7    Absence of Certain Changes or Events.    Since its inception:

 

(a) FICF is not currently engaged in any business and have not engaged in any operations and have been dormant. As of the date of this Agreement, there is no, and as of the Closing Date there shall not be any, event, condition, circumstance or prospective development which threatens or may threaten to have a material adverse effect on the assets, properties, operations, prospects, net income or financial condition of FICF; and

 

(b) there has not been, and as of the Closing Date there shall not be, any declaration, setting aside or payment of dividends or distributions with respect to shares of capital stock of FICF or any redemption, purchase or other acquisition of any capital stock of FICF or any other of FICF’s securities.

 

Section 2.8    Survival.    Each of the representations and warranties set forth in this Article II shall be deemed represented and made by FICF at the Closing as if made at such time and shall survive the Closing for a period terminating on the first anniversary of the date of this Agreement.

 

  

3

  

 

ARTICLE III

 

REPRESENTATIONS AND WARRANTIES OF CODESMART

 

CodeSmart represents, warrants and agrees as follows:

 

Section 3.1    Corporate Organization.

 

(a)      CodeSmart is duly organized, validly existing and in good standing under the laws of British Virgin Islands and has all requisite corporate power and authority to own its properties and assets and to conduct its business as now conducted and is duly qualified to do business in good standing in each jurisdiction in where the nature of the business conducted by CodeSmart or the ownership or leasing of its properties makes such qualification and being in good standing necessary, except where the failure to be so qualified and in good standing will not have a material adverse effect on the business, operations, properties, assets, condition or results of operation of CodeSmart (a “ CodeSmart Material Adverse Effect”).

 

(b)       Copies of the Articles of Incorporation of CodeSmart, with all amendments thereto to the date hereof, have been furnished to FICF, and such copies are accurate and complete as of the date hereof. CodeSmart does not own or maintain any minute books that contain the minutes of all meetings of the Board of Directors and the shareholder of CodeSmart as of the date of this Agreement.

 

Section 3.2    Capitalization of CodeSmart; Title to the CodeSmart Equity Interests.    On the Closing Date, immediately before the transactions to be consummated pursuant to this Agreement, CodeSmart has a total of 36,000,000 shares of CodeSmart Common Stock issued and outstanding. CodeSmart Shareholders shall collectively own 24,500,000 shares of CodeSmart Common Stock, representing a total of 68.06% of the equity interests of CodeSmart.

 

Section 3.3    Disclosure.    This Agreement, the schedules hereto and any certificate attached hereto or delivered in accordance with the terms hereby by or on behalf of CodeSmart in connection with the transactions contemplated by this Agreement, when taken together, do not contain any untrue statement of a material fact or omit any material fact necessary in order to make the statements contained herein and/or therein not misleading.

 

Section 3.4    Survival.    Each of the representations and warranties set forth in this Article III shall be deemed represented and made by CodeSmart at the Closing as if made at such time and shall survive the Closing for a period terminating on the first anniversary of the date of this Agreement.

 

  

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ARTICLE IV

 

REPRESENTATIONS AND WARRANTIES OF CODESMART SHAREHOLDERS

 

Each of the CodeSmart Shareholders represents, warrants and agrees as follows:

 

Section 4.1    Authorization and Validity of Agreements.    Each CodeSmart Shareholders has all entity power and authority to execute and deliver this Agreement, to perform its obligations hereunder and to consummate the transactions contemplated hereby and the execution and delivery of this Agreement by such CodeSmart Shareholder and the consummation of the transactions contemplated hereby have been duly authorized by all necessary action and no other proceedings on the part of the CodeSmart Shareholder are necessary to authorize this Agreement or to consummate the transactions contemplated hereby. No approvals by the shareholders of CodeSmart are required for CodeSmart Shareholders to consummate the transactions contemplated hereby.

 

Section 4.2    No Conflict or Violation.    The execution, delivery and performance of this Agreement by CodeSmart Shareholders does not and will not violate or conflict with any provision of the constituent documents of the CodeSmart Shareholders, and does not and will not violate any provision of law, or any order, judgment or decree of any court or other governmental or regulatory authority.

 

Section 4.3    Investment Representations.    (a) All of the Common Stock to be acquired by CodeSmart Shareholders pursuant to this Agreement will be acquired hereunder solely for the account of CodeSmart Shareholders, for investment, and not with a view to the resale or distribution thereof. Each of the CodeSmart Shareholders understands and is able to bear any economic risks associated with CodeSmart Shareholders’ investment in the Common Stock. The CodeSmart Shareholders has had full access to all the information. The CodeSmart Shareholders considers necessary or appropriate to make an informed investment decision with respect to the Common Stock to be acquired under this Agreement.

 

Section 4.4    CodeSmart Shareholders Status.

 

(i) Such CodeSmart Shareholder is an “accredited” investor as such term is defined in Rule 501(a) of Regulation D promulgated by the Commission under the Securities Act, is experienced in investments and business matters, has made investments of a speculative nature and has purchased securities of United States companies in private placements in the past and, with its representatives, has such knowledge and experience in financial, tax and other business matters as to enable CodeSmart Shareholder to utilize the information made available by the Company to evaluate the merits and risks of and to make an informed investment decision with respect to the proposed purchase, which represents a speculative investment. CodeSmart Shareholder is able to bear the risk of such investment for an indefinite period and to afford a complete loss thereof. CodeSmart Shareholder is not required to be registered as a broker-dealer under Section 15 of the Securities Exchange Act of 1934, as amended. CodeSmart Shareholder understands that the Company is relying on its representations and agreements for the purpose of determining whether this transaction meets the requirements of the exemptions afforded by the Securities Act and certain state securities laws;

 

OR

 

  

5

  

 

(ii) Such CodeSmart Shareholder is a natural person (or an entity which equity is wholly-owned by one natural person) that is or will be an employee, a director, an officer, a general partner, a consultant, an advisor of FICF or a family member of the foregoing, as such terms defined under Rule 701 of the 1933 Act, under the written compensatory benefit plan as defined under Rule 701 of the 1933 Act to be established by resolutions of the board of directors of FICF immediately prior to the Closing (the “FICF Compensatory Plan”).

 

Section 4.5    Reliance on Exemptions.    Each CodeSmart Shareholder understands that the Common Stock is being offered and issued to it in reliance on specific exemptions from the registration requirements of United States federal and state securities laws and that FICF is relying upon, among other things, the truth and accuracy of, and CodeSmart Shareholders’ compliance with, the representations, warranties, agreements, acknowledgments and understandings of CodeSmart Shareholders set forth herein in order to determine the availability of such exemptions and the eligibility of CodeSmart Shareholders to acquire the Common Stock. Each CodeSmart Shareholder acknowledges and agrees that issuance of FICF Common Stock hereunder is intended to be exempt from registration under the Securities Act of 1933, as amended (the “Act,”) by virtue of: (i) Section 4(2) of the Act, and Regulation D, Rule 506 promulgated thereunder (“Regulation D”) and, accordingly, is being made to “accredited” investors as that term is defined in Regulation D; and (ii) Rule 701 of the Act, where the issuance of FICF hereunder is being made to certain CodeSmart Shareholders that are employees, directors, officers, general partners, consultants, advisors and their family members under the FICF’s Written Compensatory Plan to be established by the board of directors of FICF immediately prior to the Closing.

 

Section 4.6    Information.    CodeSmart Shareholders and their advisors, if any, have been furnished with all materials relating to the offer and sale of the Common Stock which have been requested by CodeSmart Shareholders. CodeSmart Shareholders and their advisors, if any, have been afforded the opportunity to ask questions of FICF Neither such inquiries nor any other due diligence investigations conducted by CodeSmart Shareholders or their advisors, if any, or its representatives shall modify, amend or affect CodeSmart Shareholders’ right to rely on the representations and warranties contained herein. Each CodeSmart Shareholder understands that its investment in the Common Stock involves a high degree of risk and is able to afford a complete loss of such investment. Each CodeSmart Shareholder has sought such accounting, legal and tax advice as it has considered necessary to make an informed investment decision in respect of its acquisition of the Common Stock.

 

Section 4.7    No Governmental Review.    CodeSmart Shareholders understand that no United States federal or state agency or any other government or governmental agency has passed on or made any recommendation or endorsement of the Common Stock or the fairness or suitability of the investment in the Common Stock nor have such authorities passed upon or endorsed the merits of the offering of the Common Stock.

 

  

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Section 4.8    Transfer or Resale.    CodeSmart Shareholders understand: (i) none of the Common Stock has been or are being registered under the 1933 Act or any state securities laws, and may not be offered for sale, sold, assigned or transferred unless (A) subsequently registered thereunder, (B) CodeSmart Shareholders shall have delivered to FICF an opinion of counsel, in a form reasonably acceptable to FICF, to the effect that such Common Stock to be sold, assigned or transferred may be sold, assigned or transferred pursuant to an exemption from such registration, or (C) CodeSmart Shareholders provide FICF with assurance reasonably acceptable to FICF that such Common Stock and the Convertible can be sold, assigned or transferred pursuant to Rule 144 or Rule 144A promulgated under the 1933 Act, as amended, (or a successor rule thereto) (collectively, “Rule 144”); (ii) any sale of the Common Stock made in reliance on Rule 144 may be made only in accordance with the terms of Rule 144 and further, if Rule 144 is not applicable, any resale of the Common Stock 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) none of FICF or any other person is under any obligation to register the Common Stock under the 1933 Act or any state securities laws or to comply with the terms and conditions of any exemption thereunder.

 

Section 4.9    Survival.    Each of the representations and warranties set forth in this Article IV shall be deemed represented and made by the CodeSmart Shareholders at the Closing as if made at such time and shall survive the Closing for a period terminating on the second anniversary of the date of this Agreement.

 

ARTICLE V

 

COVENANTS

 

Section 5.1    Certain Changes and Conduct of Business.

 

(a)      From and after the date of this Agreement and until the Closing Date, FICF shall not, and the shareholders of FICF shall cause FICF not to, carry out any business other than maintaining its corporate existence and making any governmental filings necessary and in a manner consistent with all representations, warranties or covenants of FICF and the shareholders of FICF and shall not and shall cause FICF to not:

 

	  	
i.

	
make any change in its Articles of Incorporation or Bylaws; issue any additional shares of capital stock or equity securities or grant any option, warrant or right to acquire any capital stock or equity securities or issue any security convertible into or exchangeable for its capital stock or alter in any material term of any of its outstanding securities or make any change in its outstanding shares of capital stock or its capitalization, whether by reason of a reclassification, recapitalization, stock split or combination, exchange or readjustment of shares, stock dividend or otherwise;

 

  

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ii.

	
A

	
make any change in its Articles of Incorporation or Bylaws; issue any additional shares of capital stock or equity securities or grant any option, warrant or right to acquire any capital stock or equity securities or issue any security convertible into or exchangeable for its capital stock or alter in any material term of any of its outstanding securities or make any change in its outstanding shares of capital stock or its capitalization, whether by reason of a reclassification, recapitalization, stock split or combination, exchange or readjustment of shares, stock dividend or otherwise;

 

	  	  	
B.

	
issue any securities convertible or exchangeable for debt or equity securities of FICF;

 

	  	
iii.

	
make any sale, assignment, transfer, abandonment or other conveyance of any of its assets or any part thereof;

 

	  	
iv.

	
subject any of its assets, or any part thereof, to any lien or suffer such to be imposed t;

 

	  	
v.

	
acquire any assets, raw materials or properties, or enter into any other transaction;

 

	  	
vi.

	
enter into any new (or amend any existing) employee benefit plan, program or arrangement or any new (or amend any existing) employment, severance or consulting agreement, grant any general increase in the compensation of officers or employees (including any such increase pursuant to any bonus, pension, profit-sharing or other plan or commitment) or grant any increase in the compensation payable or to become payable to any employee;

 

	  	
vii.

	
make or commit to make any material capital expenditures;

 

	  	
viii.

	
pay, loan or advance any amount to, or sell, transfer or lease any properties or assets to, or enter into any agreement or arrangement with, any of its affiliates;

 

	  	
ix.

	
guarantee any indebtedness for borrowed money or any other obligation of any other person;

 

	  	
x.

	
fail to keep in full force and effect insurance comparable in amount and scope to coverage maintained by it (or on behalf of it) on the date hereof;

 

	  	
xi.

	
take any other action that would cause any of the representations and warranties made by it in this Agreement not to remain true and correct in all material aspect;

 

	  	
xii.

	
make any loan, advance or capital contribution to or investment in any person;

 

  

8

  

 

	  	
xiii.

	
make any change in any method of accounting or accounting principle, method, estimate or practice;

 

	  	
xiv.

	
settle, release or forgive any claim or litigation or waive any right;

 

	  	
xv.

	
commit itself to do any of the foregoing.

 

(b)      From and after the date of this Agreement and until the Closing Date CodeSmart shall:

 

	  	
1.

	
continue to maintain, in all material respects, its properties in accordance with present practices in a condition suitable for its current use;

 

	  	
2.

	
conduct no business other than maintaining its corporate existence and making necessary governmental filings; and

 

	  	
3.

	
keep its books of account, records and files in the ordinary course and in accordance with existing practices.

 

Section 5.2    Access to Properties and Records.    CodeSmart shall afford FICF’s accountants, counsel and authorized representatives, and FICF shall afford to CodeSmart’s accountants, counsel and authorized representatives full access during normal business hours throughout the period prior to the Closing Date (or the earlier termination of this Agreement) to all of such parties’ properties, books, contracts, commitments and records and, during such period, shall furnish promptly to the requesting party all other information concerning the other party’s business, properties and personnel as the requesting party may reasonably request, provided that no investigation or receipt of information pursuant to this Section 5.2 shall affect any representation or warranty of or the conditions to the obligations of any party.

 

Section 5.4    Consents and Approvals.    The parties shall:

 

(a)    use their reasonable commercial efforts to obtain all necessary consents, waivers, authorizations and approvals of all governmental and regulatory authorities, domestic and foreign, and of all other persons, firms or corporations required in connection with the execution, delivery and performance by them of this Agreement; and

 

(b)    diligently assist and cooperate with each party in preparing and filing all documents required to be submitted by a party to any governmental or regulatory authority, domestic or foreign, in connection with such transactions and in obtaining any governmental consents, waivers, authorizations or approvals which may be required to be obtained connection in with such transactions.

 

  

9

  

 

Section 5.5    Public Announcement.    Unless otherwise required by applicable law, the parties hereto shall consult with each other before issuing any press release or otherwise making any public statements with respect to this Agreement and shall not issue any such press release or make any such public statement prior to such consultation.

 

Section 5.6    Stock Issuance.    From and after the date of this Agreement until the Closing Date, neither FICF nor CodeSmart shall issue any additional shares of its capital stock or other securities or equity interests except for the Common Stock which are to be issued pursuant to this Agreement.

 

ARTICLE VI

 

CONDITIONS TO OBLIGATIONS OF CODESMART SHAREHOLDERS

 

The obligations of CodeSmart Shareholders to consummate the transactions contemplated by this Agreement are subject to the fulfillment, at or before the Closing Date, of the following conditions, any one or more of which may be waived by CodeSmart Shareholders in their sole discretion:

 

Section 6.1    Representations and Warranties of FICF.    All representations and warranties concerning FICF made in this Agreement shall be true and correct on and as of the Closing Date as if again made by FICF as of such date.

 

Section 6.2    Agreements and Covenants.    FICF shall have performed and complied in all material respects to all agreements and covenants required by this Agreement to be performed or complied with by it on or prior to the Closing Date.

 

Section 6.3    Consents and Approvals.    Consents, waivers, authorizations and approvals of any governmental or regulatory authority, domestic or foreign, and of any other person, firm or corporation, required in connection with the execution, delivery and performance of this Agreement shall be in full force and effect on the Closing Date.

 

Section 6.4    No Violation of Orders.    No preliminary or permanent injunction or other order issued by any court or governmental or regulatory authority, domestic or foreign, nor any statute, rule, regulation, decree or executive order promulgated or enacted by any government or governmental or regulatory authority, which declares this Agreement invalid in any respect or prevents the consummation of the transactions contemplated hereby, or which materially and adversely affects the assets, properties, operations, prospects, net income or financial condition of FICF shall be in effect; and no action or proceeding before any court or governmental or regulatory authority, domestic or foreign, shall have been instituted or threatened by any government or governmental or regulatory authority, domestic or foreign, or by any other person, or entity which seeks to prevent or delay the consummation of the transactions contemplated by this Agreement or which challenges the validity or enforceability of this Agreement.

 

  

10

  

 

Section 6.5    Other Closing Documents.    CodeSmart Shareholders shall have received such other certificates, instruments and documents in confirmation of the representations and warranties of FICF or in furtherance of the transactions contemplated by this Agreement as they or their counsel may reasonably request.

 

Section 6.6    Absence of Litigation.    No action, suit or proceeding before any court or any governmental body or authority, pertaining to the transactions contemplated by this Agreement or to its consummation, shall have been instituted or threatened.

 

Section 6.7    Disposition of FICF’s Existing Business, Assets and Liabilities.    As of the Closing Date, except for cash, FICF shall have no assets, including, without limitation, contract rights (other than its rights and obligations under contracts as set forth in Schedule 6.7), and FICF shall have no liabilities or contingent liabilities.

 

Section 6.8    Forward Split.    As soon as practicable after the Closing, FICF shall effectuate an 8-for-1 forward split of FICF Common Stock. The number of shares of FICF to be issued to CodeSmart Shareholders after taken into effect the Forward Split shall be as set forth on Schedule I hereto.

  

ARTICLE VII

 

CONDITIONS TO OBLIGATIONS OF U.S. CO

 

The obligations of FICF to consummate the transactions contemplated by this Agreement are subject to the fulfillment, at or before the Closing Date, of the following conditions, any one or more of which may be waived by FICF in its sole discretion:

 

Section 7.1    Representations and Warranties of CodeSmart and CodeSmart Shareholders.    All representations and warranties made by CodeSmart and CodeSmart Shareholders in this Agreement shall be true and correct on and as of the Closing Date as if again made by CodeSmart and CodeSmart Shareholders on and as of such date.

 

Section 7.2    Agreements and Covenants.    CodeSmart and CodeSmart Shareholders shall have performed and complied in all material respects to all agreements and covenants required by this Agreement to be performed or complied with by it on or prior to the Closing Date.

 

Section 7.3    Consents and Approvals.    All consents, waivers, authorizations and approvals of any governmental or regulatory authority, domestic or foreign, and of any other person, firm or corporation, required in connection with the execution, delivery and performance of this Agreement, shall have been duly obtained and shall be in full force and effect on the Closing Date.

 

Section 7.4    No Violation of Orders.    No preliminary or permanent injunction or other order issued by any court or other governmental or regulatory authority, domestic or foreign, nor any statute, rule, regulation, decree or executive order promulgated or enacted by any government or governmental or regulatory authority, domestic or foreign, that declares this Agreement invalid or unenforceable in any respect or which prevents the consummation of the transactions contemplated hereby, or which materially and adversely affects the assets, properties, operations, prospects, net income or financial condition of CodeSmart, taken as a whole, shall be in effect; and no action or proceeding before any court or government or regulatory authority, domestic or foreign, shall have been instituted or threatened by any government or governmental or regulatory authority, domestic or foreign, or by any other person, or entity which seeks to prevent or delay the consummation of the transactions contemplated by this Agreement or which challenges the validity or enforceability of this Agreement.

 

  

11

  

 

Section 7.5.    Other Closing Documents.    CodeSmart shall have received such other certificates, instruments and documents in confirmation of the representations and warranties of CodeSmart and CodeSmart Shareholders or in furtherance of the transactions contemplated by this Agreement as FICF or its counsel may reasonably request.

 

Section 7.6    Absence of Litigation.    No action, suit or proceeding before any court or any governmental body or authority, pertaining to the transactions contemplated by this Agreement or to its consummation, shall have been instituted or threatened against CodeSmart or CodeSmart Shareholders.

 

ARTICLE VIII

 

TERMINATION AND ABANDONMENT

 

SECTION 8.1    Methods of Termination.    This Agreement may be terminated and the transactions contemplated hereby may be abandoned at any time before the Closing:

 

(a)        By the mutual written consent of the parties;

 

(b)        By FICF upon a material breach of any representation, warranty, covenant or agreement on the part of CodeSmart Shareholders set forth in this Agreement, or if any representation or warranty of CodeSmart and CodeSmart Shareholders shall become untrue, in either case such that any of the conditions set forth in Article VII hereof would not be satisfied, and such breach shall, if capable of cure, has not been cured within ten (10) days after receipt by the party in breach of a notice from the non-breaching party setting forth in detail the nature of such breach;

 

(c)        By CodeSmart Shareholders, upon a material breach of any representation, warranty, covenant or agreement on the part of FICF set forth in this Agreement, or, if any representation or warranty of FICF and the shareholders of FICF shall become untrue, in either case such that any of the conditions set forth in Article VI hereof would not be satisfied, and such breach shall, if capable of cure, not have been cured within ten (10) days after receipt by the party in breach of a written notice from the non-breaching party setting forth in detail the nature of such breach; and

 

(d)        By any party if a court of competent jurisdiction or governmental, regulatory or administrative agency or commission shall have issued an order, decree or ruling or taken any other action (which order, decree or ruling the parties hereto shall use its best efforts to lift), which permanently restrains, enjoins or otherwise prohibits the transactions contemplated by this Agreement.

 

Section 8.2    Procedure Upon Termination.    In the event of termination and abandonment of this Agreement by a party pursuant to Section 8.1, written notice thereof shall forthwith be given by the terminating party to the other parties and this Agreement shall terminate and the transactions contemplated hereby shall be abandoned, without further action. If this Agreement is terminated as provided herein, no party to this Agreement shall have any liability or further obligation to any other party to this Agreement; provided, however, that no termination of this Agreement pursuant to this Article VIII shall relieve any party of liability for a breach of any provision of this Agreement occurring before such termination.

 

  

12

  

 

ARTICLE IX

 

MISCELLANEOUS PROVISIONS

 

Section 9.1    Survival of Provisions.    The respective representations, warranties, covenants and agreements of each of the parties to this Agreement (except covenants and agreements which are expressly required to be performed and are performed in full on or before the Closing Date) shall survive the Closing Date and the consummation of the transactions contemplated by this Agreement for a period of one year. In the event of a breach of any of such representations, warranties or covenants, the party to whom such representations, warranties or covenants have been made shall have all rights and remedies for such breach available to it under the provisions of this Agreement or otherwise, whether at law or in equity, regardless of any disclosure to, or investigation made by or on behalf of such party on or before the Closing Date.

 

Section 9.2    Publicity.    No party shall cause the publication of any press release or other announcement with respect to this Agreement or the transactions contemplated hereby without the consent of the other parties, unless a press release or announcement is required by law. If any such announcement or other disclosure is required by law, the disclosing party agrees to give the non-disclosing parties prior notice and an opportunity to comment on the proposed disclosure.

 

Section 9.3    Successors and Assigns.    This Agreement shall inure to the benefit of, and be binding upon, the parties hereto and their respective successors and assigns; provided, however, that no party shall assign or delegate any of the obligations created under this Agreement without the prior written consent of the other parties.

 

Section 9.4    Fees and Expenses.    Except as otherwise expressly provided in this Agreement, all legal and other fees, costs and expenses incurred in connection with this Agreement and the transactions contemplated hereby shall be paid by the party incurring such fees, costs or expenses.

 

 

  

13

  

 

Section 9.5    Notices.    All notices and other communications given or made pursuant hereto shall be in writing and shall be deemed to have been given or made if in writing and delivered personally or sent by registered or certified mail (postage prepaid, return receipt requested) to the parties at the following addresses:

 

If to FICF to:

 

103 Waters Edge

Congers, NY 10920

Attn: Mr. Ira Shapiro

Tel: 646-526-7867

Email: ishapiro@codesmartgroup.com

 

with a copy to:

 

Ofsink, LLC

900 Third Avenue, 5th Floor

New York, New York 10022

Attn: Darren Ofsink, Esq.

Fax: 646-224-9844

  

If to CodeSmart or CodeSmart Shareholders, to:

 

103 Waters Edge

Congers, NY 10920

Attn: Mr. Ira Shapiro

Tel: 646-526-7867

Email: ishapiro@codesmartgroup.com

 

or to such other persons or at such other addresses as shall be furnished by any party by like notice to the others, and such notice or communication shall be deemed to have been given or made as of the date so delivered or mailed. No change in any of such addresses shall be effective insofar as notices under this Section 9.5 are concerned unless such changed address is located in the United States of America and notice of such change shall have been given to such other party hereto as provided in this Section 9.5

 

Section 9.6    Entire Agreement.    This Agreement, together with the exhibits hereto, represents the entire agreement and understanding of the parties with reference to the transactions set forth herein and no representations or warranties have been made in connection with this Agreement other than those expressly set forth herein or in the exhibits, certificates and other documents delivered in accordance herewith. This Agreement supersedes all prior negotiations, discussions, correspondence, communications, understandings and agreements between the parties relating to the subject matter of this Agreement and all prior drafts of this Agreement, all of which are merged into this Agreement. No prior drafts of this Agreement and no words or phrases from any such prior drafts shall be admissible into evidence in any action or suit involving this Agreement.

 

  

14

  

 

Section 9.7    Severability.    This Agreement shall be deemed severable, and the invalidity or unenforceability of any term or provision hereof shall not affect the validity or enforceability of this Agreement or of any other term or provision hereof. Furthermore, in lieu of any such invalid or unenforceable term or provision, the parties hereto intend that there shall be added as a part of this Agreement a provision as similar in terms to such invalid or unenforceable provision as may be possible so as to be valid and enforceable.

 

Section 9.8    Titles and Headings.    The Article and Section headings contained in this Agreement are solely for convenience of reference and shall not affect the meaning or interpretation of this Agreement or of any term or provision hereof.

 

Section 9.9    Counterparts.    This Agreement may be executed in two or more counterparts, each of which shall be deemed an original and all of which together shall be considered one and the same agreement.

 

Section 9.10    Convenience of Forum; Consent to Jurisdiction.    The parties to this Agreement, acting for themselves and for their respective successors and assigns, without regard to domicile, citizenship or residence, hereby expressly and irrevocably elect as the sole judicial forum for the adjudication of any matters arising under or in connection with this Agreement, and consent and subject themselves to the jurisdiction of, the courts of the State of New York located in County of New York, and/or the United States District Court for the Southern District of New York, in respect of any matter arising under this Agreement. Service of process, notices and demands of such courts may be made upon any party to this Agreement by personal service at any place where it may be found or giving notice to such party as provided in Section 9.5.

 

Section 9.11    Enforcement of the Agreement.    The parties hereto agree that irreparable damage would occur if any of the provisions of this Agreement were not performed in accordance with their specific terms or were otherwise breached. It is accordingly agreed that the parties shall be entitled to an injunction or injunctions to prevent breaches of this Agreement and to enforce specifically the terms and provisions hereto, this being in addition to any other remedy to which they are entitled at law or in equity.

 

Section 9.12    Governing Law.    This Agreement shall be governed by and interpreted and enforced in accordance with the laws of the State of New York without giving effect to the choice of law provisions thereof.

 

Section 9.13    Amendments and Waivers.    No amendment of any provision of this Agreement shall be valid unless the same shall be in writing and signed by all of the parties hereto. No waiver by any party of any default, misrepresentation, or breach of warranty or covenant hereunder, whether intentional or not, shall be deemed to extend to any prior or subsequent default, misrepresentation, or breach of warranty or covenant hereunder or affect in any way any rights arising by virtue of any prior or subsequent such occurrence.

 

  

15

  

 

IN WITNESS WHEREOF, the parties hereto have executed this Share Exchange Agreement as of the date first above written.

 

	  	
FIRST INDEPENDENCE CORP.

	  	  
	  	
By:

	
/s/ Ira Shapiro

	  	
Name:

	
Ira Shapiro

	  	
Title:

	
Chief Executive Officer

  

	  	
THE CODESMART GROUP, INC.

	  	  	  
	  	
By:

	
/s/ Ira Shapiro

	  	
Name:

	
Ira Shapiro

	  	
Title:

	
Chief Executive Officer

 

[CodeSmart Shareholders Signature Pages to Follow]

 

  

16

  

 

	  	
CODESMART SHAREHOLDERS:

	  	  
	  	
/s/ Ira Shapiro

	  	
Ira Shapiro

	  	  
	  	
/s/ Sharon Franey

	  	
Sharon Franey

	  	  
	  	
/s/ Ruth Patterson

	  	
Ruth Patterson

	  	  
	  	
/s/ Alan Pressman

	  	
Alan Pressman

	  	  
	  	
/s/ Alan Matzkin

	  	
Alan Matzkin

	  	  
	  	
/s/ Judith Monestime

	  	
Judith Monestime

 

  

17

  

 

	  	
/s/  Peter Okun

	  	
Peter Okun

	  	  	  
	  	
/s/ Lisa Rawlins

	  	
Lisa Rawlins

	  	  	  
	  	
/s/ John Geraghty

	  	
John Geraghty

	  	  	  
	  	
/s/ Barbara Cohen

	  	
Barbara Cohen

	  	  	  
	  	
Brio Financial Group 

	  	  	  
	  	
By:

	
/s/ David Briones

	  	
Name:

	
David Briones

	  	
Title:

	
Managing Member

	  	  	  
	  	
Lucosky Brookman LLP

	  	  	  
	  	
By:

	
/s/ Joseph Lucosky

	  	
Name:

	
Joseph Lucosky

	  	
Title:

	
Partner

 

  

18

  

 

 

Exhibit A

 

List of CodeSmart Shareholders

 

	
Name of Shareholder

	
Number of FICF Common Stock to 

Issue prior to Forward Split

	
Ira Shapiro

	
1,425,000

	
Sharon Franey

	
1,456,250

	
Ruth Patterson

	
62,500

	
Alan Pressman

	
9,375

	
Alan Matzkin

	
9,375

	
Judith Monestime

	
6,250

	
Peter Okun

	
6,250

	
Lisa Rawlins

	
6,250

	
Brio Financial Group

	
15,625

	
Lucosky Brookman LLP

	
15,625

	
John Geraghty

	
18,750

	
Barbara Cohen

	
31,250

	
Total

	
4,500,000

 

 

	
19

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