Document:

AGREEMENT FOR PURCHASE AND SALE OF ASSETS

 

This
Agreement for Purchase and Sale of Assets (the “Agreement”), dated effective as of April 1, 2016 (the
“Effective Date”), is by and among Labor
SMART, INC., a Nevada corporation whose mailing address is 3270 Florence Road, Suite 200, Powder Springs, Georgia 30127
(“Seller”) and THE
STAFFING GROUP, LTD., a Nevada corporation whose mailing address is 125 Townpark Drive, Suite 300, Kennesaw Ga
30144, or its assigns (“Buyer”); and Ryan
Schadel, whose home address is 2815 Aquitania Lane, Cumming, Georgia 30040 (“Schadel”). 

 

BACKGROUND INFORMATION

Seller is engaged
in the business of providing on-demand temporary personnel and labor to small and large businesses in a variety of industries,
including, without limitation, construction, manufacturing, production, hospitality, events, restoration, warehousing, retail,
demolition and landscaping (collectively, the “Business”). Buyer desires to purchase only certain assets
from Seller (the assets to be acquired being hereinafter referred to as the “Purchased Assets”). Seller
is willing to sell the Purchased Assets to Buyer, but only upon the terms and conditions hereinafter set forth. Accordingly, in
consideration of the mutual agreements contained in this Agreement, Seller, Buyer and Schadel hereby agree as follows.

OPERATIVE PROVISIONS

1.                 
Agreement to Sell and Purchase. Seller operates its business from approximately seventeen
(17) branch offices located throughout the United States. Buyer is only interested in acquiring the branch offices located at the
addresses set forth in Schedule 1 attached hereto (the “Branch Offices”). Subject to the
terms and conditions of this Agreement, at the closing referred to in Section 2 hereof, Buyer shall acquire the Purchased Assets.
The Purchased Assets shall include only the following assets of Seller:

a.                  
Customer Lists. All right, title and interest of Seller in and to the customer lists
for each of the Branch Offices, the telephone and facsimile numbers for each of the Branch Offices, the trade secrets and other
proprietary information of such Branch Offices (excluding all tradenames, trademarks, service marks, and open accounts receivable
(and all applications therefor)) owned by Seller or used in or necessary for the operation of the Business and any other assets
listed on Schedule 1(a) hereto (collectively, the “Proprietary Rights”);

b.                 
Leases and Contracts. All right, title and interest of Seller in and to certain leases
for real or personal property, contracts (expressly including unfilled purchase and sale orders, and all rights under any non-competition,
non-solicitation or non-disclosure agreement or other arrangement in favor of Seller), commitments, arrangements or understandings,
written or oral, pertaining to the operation of the Business at the Branch Offices excluding open accounts receivable of Seller,
listed or described on Schedule 1(b) hereto (collectively, the “Contracts”); 

c.                  
Fixed Assets. All vans, vehicles, equipment, furniture, fixtures, computer hardware,
computer software and all other tangible personal property of every kind and nature owned by Seller or used in or necessary for
the operation of the Business at the Branch Offices, including, but not limited to, those assets listed on Schedule 1(c)
hereto (collectively, the “Fixed Assets”) but specifically excluding open accounts receivable of Seller;
and

d.                 
Business Records. All files, correspondence, invoices and other business records used
in or necessary for the operation of the Business at the Branch Offices, including, but not

    	 	-1-	 

    

    

limited to, price lists, sales
records, sales correspondence, credit records, purchase orders and sales orders.

2.                 
Closing. The consummation of the transactions contemplated by this Agreement shall
take place at a closing (the “Closing”) to be held at a time, date and place as the parties hereto may
mutually agree but shall be no later than April 1, 2016. The Closing may take place remotely, by exchange of documents and signatures
by email and overnight mail, as counsel to the parties may agree. At the Closing, Seller shall deliver to Buyer such conveyances,
bills of sale, assignments, agreements and other documents, in form and substance satisfactory to Buyer’s counsel, as may
be reasonably requested by Buyer’s counsel to effect the sale and transfer of the Purchased Assets and to consummate the
transactions contemplated by this Agreement and shall make such other deliveries specified in or contemplated by this Agreement.
When all such deliveries have been completed, Buyer shall deliver to Seller wired funds in accordance with Section 3 hereof.

		3.	Purchase Price and Payment. The purchase price to be paid
by Buyer to Seller in 

exchange for Buyer’s acquisition of the
Purchased Assets shall equal Two Million Nine Hundred Fifteen Thousand Dollars ($2,915,000.00) (the “Purchase Price”)
and shall be paid as follows: (a) Eight Hundred Ninety Thougsand Hundred Eighty Nine Dollars ($890,889.00) in cash and (b) Six
Hundred Thousand shares of Buyers Common Stock (600,000) at a cost basis of $1.80 per share, and (c) a Promissory Note in favor
of Seller (the “Note”) on the Closing date in the amount of Seven Hundred Fifty Five Thousand Dollars ($755,000)
and (d) payoff of Seller’s debt to Mantis Fund, LLC in the amount of Twenty Nine Thousand One Hundred Eleven Dollars($29,111.00)
and (e) pay on behalf of Seller an amount of One Hundred Sixty Thousand Dollars ($160,000) to the Internal Revenue Service. The
parties have agreed to allocate the Purchase Price in the manner set forth on Schedule 3 attached hereto (the “Asset
Purchase Price Allocation”).

 

4.              
No Assumption of Liabilities. Buyer shall not assume or be responsible for any liability
or obligation of Seller, except for those related to certain leases for real or personal property as contemplated in 1(b).

 

5.              
Representations and Warranties by Seller and Schadel. To induce Buyer to enter into
this Agreement, Seller and Schadel, jointly and severally, represent and warrant as follows:

 

a.                  
Organization and Standing of Seller. Seller is a corporation duly organized, validly
existing and in good standing under the laws of the State of Nevada and has all requisite power and authority to own, operate and
lease its properties and to carry on the Business as now being conducted. Seller has the power to sell, assign, transfer, convey
and deliver the Purchased Assets as contemplated by this Agreement.

 

b.                 
Authorization. The execution, delivery and performance of this Agreement by Seller
and its consummation of the transactions contemplated hereby have been duly authorized by Seller and Schadel, which authorization
and approval constitute all authorization necessary on the part of Seller. This Agreement constitutes the legal, valid and binding
obligation of Seller and Schadel, enforceable in accordance with its terms.

 

c.Contracts.
In connection with its operations of the Branch Offices, Seller does not have any Contracts, except those listed and described
in Schedule 1(b), all of which were made in the usual and ordinary course of business. Seller has delivered to Buyer
correct and complete copies of all of the Contracts that are in written form, and Schedule 1(b) contains a correct
and complete description of any Contracts that are not in written form. Seller has fulfilled, or taken all action necessary to
enable it to fulfill when due, all material obligations

    	 	-2-	 

    

    

under the Contracts. There has not
occurred any material breach or default, or any event which with the lapse of time or the election of any person, or both, will
become a material breach or default, under any Contract, and all Contracts are legal, valid and binding and in full force and effect.
Seller has no unfilled customer sales orders for the Branch Offices, other than those set forth on Schedule 1(b).

 

d.                 
Financial Statements. Seller has delivered to Buyer its unaudited statement of operations
for each of the Branch Offices for the fiscal years ending December 31, 2015, copies of which are attached hereto as Schedule
5(d). Such financial statements fairly present the results of operations of the Branch Offices of Seller, all in accordance
with generally accepted accounting principles, subject to normal recurring year-end adjustments (the effect of which will not,
individually or in the aggregate, be materially adverse).

e.                  
Pricing and Operating Information. Seller has delivered to Buyer certain financial
and operating information concerning the Business at the Branch Offices, including, but not limited to, its standard costs for
providing its services, copies of which are attached hereto as Schedule 5(f). Current average selling prices for
its services, together with a gross profit schedule detailing sales and overhead expenses, realized by Seller within its fiscal
year ending December 31, 2015, with such results having been allocated as accurately as practicable on the basis of currently available
information, are attached hereto as Schedule 5(f). Such pricing and operating information is, to the best knowledge
of Seller and Schadel, correct and complete in all material respects.

f.                  
No Material Change in Business. Since December 31, 2015, the Business at the Branch
Offices has been operated in the ordinary course and there has been no material adverse change in, or event or state of facts which
has affected or may affect, materially and adversely, the condition (financial or otherwise) of the assets, liabilities, earnings
or operations of the Business at the Branch Offices.

g.                  
Infringement. Seller is the sole and exclusive owner of, and has the sole exclusive
right to use, all Proprietary Rights used in or necessary for the operation of the Business at the Branch Offices, all of which
are listed on Schedule 1(a) hereto. The Proprietary Rights are valid and enforceable. None of the Proprietary
Rights nor the operation of the Business infringes upon the proprietary rights of others, and no claims of such infringement have
been made or are pending, and there is no basis for any such claims.

h.                 
Customers. Set forth on Schedule 5(l) hereto is a complete customer list,
showing past and current customers of Seller at the Branch Offices, the dollar volume of business done with each customer for the
fiscal year ending December 31, 2015, and the name and contact information for the person with whom Seller did business with for
each of the customers.

i.                   
Employees. Set forth on Schedule 5(m) is a complete list of each employee
at the Branch Offices during 2014 and 2015, together with such employee’s (i) name, (ii) job title, (iii) date of commencement
of employment or engagement, (iv) current compensation paid or payable and any change in compensation since January 1, 2016, (v)
sick or vacation leave that is accrued but unused; and (vi) whether or not such employee is party to a non-competition, non-solicitation
or non-disclosure agreement or arrangement. Each employee of each Branch Office is a citizen of the United States or is otherwise
authorized to work in the United States.

j.                   
Absence of Undisclosed Operations Liabilities. Except as set forth on Schedule
5(n), Seller has no liabilities or obligations of any nature, whether accrued, absolute, contingent

    	 	-3-	 

    

    

or otherwise, that would impact
the operation of the Branch Offices, and neither Seller nor Schadel knows or has any reason to know of any basis for the assertion
of any such liability or obligation.

k.                 
Disclosure. Neither this Agreement, nor any other document, certificate or statement
furnished to Buyer by or on behalf of Seller or Schadel in connection with the transactions contemplated hereby, within the actual
knowledge of Seller or Schadel, contains any untrue statement of a material fact or omits to state a material fact necessary in
order to make the statements contained herein or therein not misleading; and there is no fact which materially adversely affects,
or in the future may (so far as Seller or Schadel can now reasonably foresee) materially adversely affect the assets, business,
operations or prospects of Seller which has not been set forth herein or in a schedule or statement furnished to Buyer. 

6.                 
Further Assurances. Seller and Schadel agree that, at any time and from time to time
after the Closing Date, they will execute and deliver to Buyer such further conveyances, assignments and other written assurances
as Buyer may reasonably request in order to vest and confirm in Buyer, or its assignee, title to the Purchased Assets to be transferred,
assigned and conveyed hereunder. Following the Closing Date, Seller will provide without charge such explanations, descriptions
and general information as Buyer may reasonably request with respect to the Purchased Assets.

7.                 
Access to Books and Records; Future Litigation. Without the written consent of Buyer,
on the one hand, or Seller and Schadel, on the other hand, for a period of five (5) years from the Closing Date, Seller or Buyer,
respectively, will not destroy or otherwise dispose of any records relating to the Purchased Assets without first advising the
other party(ies) hereto and offering to surrender them to such other party(ies), and Buyer, Seller and Schadel shall each have
reasonable access to such records during normal business hours for any proper purpose. 

8.                 
Covenant Not to Compete. Seller and each of its affiliates agree that, without written
consent from Buyer, for a period of five (5) years after the Closing, neither it nor any of its affiliates will, directly or indirectly,
own, manage, operate or control, or participate in the ownership, management, operation, or control of, or become associated as
an employee, director, manager, officer, advisor, agent, consultant, principal, partner, shareholder, member, independent contractor
with or lender to, any person or entity engaged in or aiding others to engage in the Business located or operating anywhere within
a forty (40) mile radius of any Branch Office. The parties hereto specifically acknowledge and agree that this covenant shall be
construed as an agreement independent of any other provision herein and further agree that the remedy at law for any breach of
the foregoing will be inadequate and that Buyer, in addition to any other relief available to it, shall be entitled to temporary
and permanent injunctive relief without the necessity of proving actual damage. In the event that any portion of the covenants
contained in this Section 8 or in Section 9 are held by a court of law to be unenforceable with respect either to its duration,
geographical area, customer base or employee base, for whatever reason, it shall be considered divisible both as to time, geographical
area, customer base and employee base, so that each month of the specified period shall be deemed a separate period of time, each
state within the defined area a separate geographical area, and each employee and customer a separate person, resulting in an intended
requirement that the longest lesser period of time, largest lesser geographical area and largest lesser customer and employee base
found by such court to be a reasonable restriction shall remain an effective restrictive covenant, specifically enforceable against
Seller. 

9.                 
Prohibited Activities.  Seller developed trade secrets and other confidential
information which Seller is selling to Buyer. Seller acknowledges that such trade secrets and other confidential information have
been and will be of central importance to the business of Buyer and that disclosure of it to, or its use by, others could cause
substantial loss to Buyer. Seller also recognizes that Buyer acquired

    	 	-4-	 

    

    

Seller’s goodwill at the Branch
Offices and that there is a danger that this goodwill, a proprietary asset of Buyer, could be damaged by Seller. Accordingly, Seller
agrees as follows:

a.                  
Non-Solicitation of Customers and Employees. Seller and each of its affiliates will
not, at any time during the five (5) year period following the Closing Date (i) solicit for employment, employ or be involved with
the employment of any person who, at the time of such solicitation or employment, is employed, or was employed within the preceding
twelve (12) months, by Buyer or any affiliate thereof at any of the Branch Offices; (ii) whether for its own account or for the
account of any other person, solicit, divert or endeavor to entice away from Buyer or any affiliate thereof, or otherwise engage
in any activity intended to terminate, disrupt or interfere with, Buyer’s or any of its affiliate’s relationships with
clients at the Branch Offices or otherwise adversely affect Buyer’s or any of its affiliate’s relationships with clients
at the Branch Offices or other business relationships of Buyer or any affiliate thereof at the Branch Offices; or (iii) publish
or make any statement critical of Buyer, or its affiliates, or any of their respective employees, agents, consultants, owners or
shareholders, or in any way adversely affect or otherwise malign the business or reputation of any of the foregoing persons. 

b.                 
Unauthorized Disclosure.  Seller agrees that it will keep Buyer’s trade
secrets and other confidential information confidential and will not disclose or furnish to any other person or, directly or indirectly,
use for its own account or the account of any other person, any trade secrets and other confidential information, no matter from
where or in what manner it may have acquired such trade secrets and other confidential information, and Seller shall retain all
such trade secrets and other confidential information in trust for the benefit of Buyer. This confidentiality covenant has no geographical
or territorial restriction. 

		10.	Deliverables.

a.                  
Bill of Sale. At the Closing and upon receipt of wired funds, Seller shall deliver
or caused to be delivered to Buyer a Bill of Sale and Assignment in the form attached hereto as Schedule 11(a), pursuant
to which Seller has transferred and assigned the Purchased Assets, duly executed by Seller.

b.                 
Assignment of Leases or Subleases. At the Closing, Seller shall deliver or caused to
be delivered to Buyer an assignment, agreement or other documentation, acceptable to Buyer in its sole and absolute discretion,
granting Buyer the option to lease or sublease the Branch Offices.

		11.	Indemnification. 

a.                  
General Indemnification. Subject to the terms and conditions of Section 12(b) below,
Seller and Schadel, jointly and severally, shall indemnify, defend and hold Buyer (and any successor in interest) harmless against
and in respect of all actions, suits, losses, liabilities, damages, deficiencies, claims, demands, costs and expenses (including
attorneys’ fees and costs of investigation) which may arise after the Closing out of (i) the failure of any representation
or warranty of Seller or Schadel contained in this Agreement or any document related to the transactions contemplated by this Agreement
to be true and correct when made or deemed made under the terms hereof; (ii) the breach of any covenant or agreement of Seller
or Schadel contained in this Agreement or any document related to the transactions contemplated by this Agreement; (iii) any asset
not included in the Purchased Assets; (iv) any liability of Seller or Schadel; or (v) any claim, liability or obligation based
upon, resulting from, relating to or arising out of the Business, operations, properties, assets or obligations of Seller conducted,
existing or

    	 	-5-	 

    

    

arising on or prior to the Closing
Date. Interest on any indemnification payment shall accrue at an annual rate of twelve percent (12%) from the date such loss, liability,
damage or expense is paid by Buyer to the date of its satisfaction by the indemnifying party. The indemnification provided for
in this Section 12 is in addition to any other right, remedy or power herein specifically granted and now or hereafter existing
in equity, at law, by virtue of statute, by agreement or otherwise.

b.                 
Conditions of Indemnification. With respect to any actual or potential claim, any written
demand, the commencement of any action or occurrence of any other event which involves any matter or related series of matters
against which Buyer is indemnified by Seller and Schadel (each a “Claim”):

1.                 
 Within thirty (30) days (or such longer period as shall not materially prejudice the rights
of Seller and Schadel) after any of Buyer’s executive officers first receives a written document presenting a Claim, or,
if such Claim does not involve a third party Claim, after any of Buyer’s executive officers first has actual knowledge of
such Claim, Buyer shall give notice to Seller and Schadel of such Claim, stating in reasonable detail the amount involved, if known,
together with a copy of any written documentation furnished to Buyer.

2.                 
If the Claim involves a third party Claim, then Seller and Schadel shall have the right, at
their expense and ultimate liability, regardless of the outcome, to engage counsel of their choice (subject to the right of Buyer
to review each such choice and, if dissatisfied for substantive reasons, to require Seller and Schadel to seek alternative counsel),
to litigate, defend, settle or otherwise attempt to resolve such Claim, except that Buyer may fully participate, at Buyer’s
own cost, in such defense, settlement or other resolution. Buyer, Seller and Schadel will fully cooperate with each other and their
respective counsel, as applicable, in connection with any such litigation, defense, settlement or other resolution. 

12.             
Survival of Warranties. All representations and warranties in this Agreement shall
survive for a period of three (3) years following the Closing Date, notwithstanding any investigation by or on behalf of any party.

13.Brokerage
Fees. Neither Seller, Schadel nor Buyer retained a broker in connection with the sale of the Purchased Assets to Buyer. Seller
and Schadel will indemnify and hold Buyer harmless from any claim made by a broker claiming that it is owed a commission from Buyer
as a result of the transactions contemplated by this Agreement.

		13.	Miscellaneous.

a.Correspondence.
Seller authorizes and empowers Buyer after the Closing: (i) to open all mail and other communications addressed to the Business
which are received by Buyer and (ii) to deal with the contents of such communications in a proper manner. Seller will promptly
deliver to Buyer the original of any mail or other communication received by Seller pertaining to the operations of the Business
after the Closing Date or the Purchased Assets and any monies, checks or other instruments of payment to which Buyer is entitled.
Buyer will promptly deliver to Seller the original of any mail or other communication received by Buyer pertaining to the operation
of the Business prior to the Closing Date and any monies, checks or other instruments of payment to which Seller is entitled. Buyer
will empower employees of the Branch Offices to assist Seller, where necessary, in collection of Seller’s open receivables
and

    	 	-6-	 

    

    

remittance to Seller of any funds
received by Buyer for Seller’s open receivables. Additionally, Buyer will assist Seller in retaining documentation as needed
from the Branch Offices for Seller’s record keeping obligations, limited to documentation and records created prior to the
Closing date.

b.Assignability.
Seller and Schadel may not assign this Agreement nor may they assign any rights that they have to amounts due under this Agreement
or any other agreement referenced herein. Conversely, this Agreement shall be assignable by Buyer without the prior written consent
of Seller or Schadel, including, without limitation, any and all restrictive covenants contained herein. Seller and Schadel acknowledge
and expressly agree that all aspects of this Agreement may be assigned by Buyer without its or his consent, and Seller and Schadel
agree to be bound by the terms of this Agreement, including, but not limited to, the restrictive covenants contained herein on
non-competition. This Agreement shall inure to the benefit of and be enforceable by the successors and assigns of Buyer, including
any successor or assign to all or substantially all of the business and/or assets of Buyer, whether direct or indirect, by purchase,
merger, consolidation, acquisition of stock or otherwise.

c.Notices.
All notices, requests, demands and other communications in connection with this Agreement shall be made in writing (including facsimile
transmission or similar writing) addressed:

If to Buyer to:

The address set
forth for Buyer in the preamble to this Agreement.

 

If to Seller or Schadel
to:

The address set
forth for Seller or Schadel in the preamble to this Agreement.

Each notice, request, demand or
other communication shall be effective and deemed to have been received (i) if given by facsimile, when such facsimile is transmitted
to the facsimile number specified above and confirmation is received, (ii) if given by mail, the earlier of actual receipt or seventy-two
(72) hours after such communication is deposited in the mails with registered first class postage prepaid, addressed as aforesaid,
(iii) if given by an overnight courier service of national recognition, the business day following the business day of deposit
with such service, together with a proper airbill affixed, addressed as aforesaid and shipping charges prepaid or prearranged,
or (iv) if given by any other means, when delivered to the aforesaid address. Either party may change the address to which notices
are to be delivered to it by giving written notice of such other address to the other party.

d.Severability;
Amendments; Captions. The invalidity or unenforceability of any provision herein shall not offset the validity or enforceability
of any other provision hereof. This Agreement shall not be modified, amended or terminated except by written agreement of both
parties. Captions appearing in this Agreement are for convenience only and shall not be deemed to explain, limit or amplify the
provisions hereof.

e.Application
of Georgia Law; Venue. This Agreement, and the application or interpretation thereof, shall be governed exclusively by
its terms and by the laws of the State of

    	 	-7-	 

    

    

Georgia. Venue for any legal action
which may be brought thereunder shall be deemed to lie in Atlanta, Georgia.

f.Counterparts.
This Agreement may be executed in any number of counterparts, each of which shall be deemed an original, but all of which together
shall constitute one and the same instrument.

g.Legal
Fees. If a legal action is initiated by any party to this Agreement against another, arising out of or relating to the alleged
performance or non-performance of any right or obligation established hereunder, or any dispute concerning the same, any and
all fees, costs and expenses reasonably incurred by each successful party or his or its legal counsel in investigating, preparing
for, prosecuting, defending against, or providing evidence, producing documents or taking any other action in respect of, such
action shall be the joint and several obligation of and shall be paid or reimbursed by the unsuccessful party.

h.Jurisdiction.
Seller and Schadel irrevocably (i) submit to the exclusive jurisdiction of  the state and federal courts within Atlanta,
Georgia for the purpose of any suit, action, or other proceeding arising out of this Agreement or any of the agreements or transactions
contemplated hereby (each, a “Proceeding”), (ii) agree that all claims in respect of any Proceeding shall
only be heard and determined in any such court, (iii) waive, to the fullest extent permitted by law, any  right to challenge
the jurisdiction of any such court or from any legal process therein, (iv) agree not to commence any Proceeding other than in such
courts, and (v) waive, to the fullest extent permitted by law, any claim that such Proceeding is brought in an inconvenient forum. 

i.Definition.
The term “affiliate”, when used in this Agreement means, as to any specified person, any other person that directly
or indirectly controls, or is under common control with, or is controlled by, such specified person and, if such other person is
an individual, any member of the immediate family of such individual. As used in this definition, “control”
(including, with its correlative meanings, “controlled by” and “under common control with”)
shall mean possession, directly or indirectly, of power to direct or cause the direction of management or policies (whether through
ownership of securities or partnership or other ownership interests, by contract or otherwise) and “immediate family”
shall mean any parent, child, grandchild, spouse or sibling.

 

 

[Signature
page to follow]

 

 

 

 

    	 	-8-	 

    

    

This Agreement has
been executed by the parties hereto the day and year first above written.

SELLER:

 

Labor
Smart, inc.

 

 

 

/s/                                                                      

By: Ryan Schadel

Its: President and Chairman

 

 

 

BUYER:

THE
STAFFING GROUP, LTD.

 

 

 

/s/                                                                      

By: Kimberly Thompson

Its: Chief Executive Officer

 

 

 

Schadel:

 

 

 

/s/                                                                      

Ryan Schadel, in his

individual capacity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

[Signature
page to Agreement for Purchase and Sale of Assets]

 

    	 	-9-Letter of Intent

EXHIBIT 10.1

LOGICQUEST TECHNOLOGY INC.

410 Park Avenue, 15th Floor #31

New York, NY  10022

March 31, 2016

Logicquest Technology Limited

Box 957, Offshore Incorporations Centre 

Road Town, Tortola, B.V .I

Attention: Yew Siong Cheng 

Dear Mr. Cheng:

		
	Re:

	Letter of Intent for the combination of Logicquest Technology Limited ("Logicquest") and Logicquest Technology Inc. ("Pubco")

	 

	 

This letter confirms our mutual intention to enter into negotiations to effect a business combination (the "Transaction") on the terms set forth below. This letter is not intended to create legally binding obligations except as set out in paragraphs 4, 6 and 7 below but will serve as the basis for negotiating a definitive agreement leading to the completion of the Transaction.

1.

The Transaction

1.1 

Structure: The Transaction may be effected in one of several different ways, including an asset acquisition, merger of Logicquest and Pubco, or a share purchase whereby Pubco purchases the shares of Logicquest from its shareholders for cash and/or for shares of Pubco.

The parties will jointly determine the optimum structure for the Transaction in order to best satisfy tax planning, regulatory and other considerations, including mutually agreed upon performance based milestones.

1.2

Consideration: Pubco will pay US$3,000,000 to the shareholders of Logicquest for all issued and outstanding share of Logicquest, payable as follows:

(a)

$1,000,000 on Closing of the Transaction;

(b)

$1,000,000 six months from Closing of the Transaction; and

(c)

$1,000,000 on the first anniversary of the Closing of the Transaction.

1.3

Terms and conditions: The definitive agreement under which the parties will agree to carry out the Transaction (the "Transaction Agreement") will contain provisions that are customary for a transaction of this nature, and will include (but not be limited to) representations and warranties of both Logicquest and Pubco (and the Logicquest principal shareholders), including Pubco's status as a reporting issuer with the U.S. Securities and Exchange Commission Exchange (the "SEC"). The closing conditions in favour of both Pubco and Logicquest will include the following:

(a)

receipt of all required regulatory approvals to the carrying out of the Transaction;

Logicguest Technology Inc.

Logicquest Technology Limited Letter of Intent

Page | 2

(b)

approvals of the boards of directors of Logicquest and Pubco and shareholders of Logicquest;

(c)

obtaining all required consents of third parties;

(d)

completion of all required audited and unaudited financial statements of Logicquest, prepared in accordance with US GAAP and audited and by a PCAOB registered audit firm;

(e)

Pubco and its accountant having had a reasonable opportunity to review the foregoing financial statements (including corporate tax returns, general ledger listings, adjusting entries and opening trial balances) of Logicquest, and that both Pubco and its accountant are satisfied with the content of such financial statements;

(f)

completion, to their respective sole satisfaction, of due diligence by Logicquest and Pubco of each other;

(g)

no material change in the employment agreements of either party without the prior consent of the other party;

(h)

all representations in the Transaction Agreement being accurate as of the closing of the Transaction;

(i)

no adverse material change in the business or financial condition of Logicquest or Pubco since the execution of the Transaction Agreement;

(j)

closing of the transaction to be completed on a best efforts basis by both parties within the following parameters:

(i)

notice of completion of substantial due diligence and board approval by both parties by Jun 30, 2016;

(ii)

execution of Transaction Agreement by Jun 30, 2016;

(iii)

receipt of all required shareholder approval s from Logicquest by Jun 30, 2016; and

(iv)

closing of Transaction by June 30, 2016

Both parties will work diligently during this period but recognize that regulatory and other market delays may require adjustments to this timetable.

2.

Due Diligence

Once all parties have signed this letter, the due diligence teams of Logicquest and Pubco will commence due diligence investigations on the other entity. Logicquest and Pubco will give the other full access to all of its (i) books, records, business plans, financial and operating data and all other information; (ii) assets and operations; and (iii) personnel.

Logicguest Technology Inc.

Logicquest Technology Limited 

Letter of Intent

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In the event that each of Pubco and Logicquest do not notify the other in writing prior to 5:00 p.m. (P.S.T. time) on Jun 30, 2016 (or such later date as the parties may mutually agree upon) that the results of their investigations are satisfactory and they are willing to negotiate and enter into the Transaction Agreement, this letter agreement shall terminate and be of no further force or effect.

3.

Definitive Agreement

Upon the satisfactory completion of diligence by Logicquest and Pubco, the parties shall negotiate the terms of the Transaction Agreement, acting reasonably and in good faith, with a view to executing the agreement on or before Jun 30, 2016.

4.

Standstill

During the period from the satisfactory completion of diligence until this letter agreement is either superseded by the Transaction Agreement or terminated pursuant to section 2, Logicquest agrees that it will:

(a)

not solicit offers or have discussion with any third parties regarding its sale of its shares or assets or any other form of business combination,

(b)

conduct its business only in , and not take any action except in , the usual, ordinary and regular course of business consistent with past practice, and

(c)

not pay any dividends engage in non-arm's length transactions with its shareholders, or redeem any of its currently outstanding shares.

5.

Transaction Costs

In the event that this Transaction does not close, each of the parties will be responsible for all  costs (including, but not limited to, financial advisory, accounting, legal and other professional or consulting fees and expenses) incurred by it in connection with the transactions contemplated hereby.

6.

Publicity

Neither party will make any announcement, issue any press release or otherwise disclose the existence of this letter, without the prior written consent of the other party.

Logicquest acknowledges that, as a reporting issuer, Pubco will be required to give public disclosure about the Transaction.

7.

Confidentiality Agreements

Each party will agree to keep the existence and the terms of this Letter of Intent confidential and will not make any disclosure except where disclosure is required by law. In addition, each party agrees that any information provided to the other in connection with the negotiation and entering into of the definitive agreements for the Transaction will be maintained in confidence, will not be disclosed to any other party, other than each party's respective professional advisors, except where disclosure is compelled by

Logicguest Technology Inc.

Logicquest Technology Limited 

Letter of Intent

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applicable law and will not be used by the party for any purpose other than the evaluation and completion of the Transaction. Each party will ensure that its respective officers, directors, employees and consultants will agree to maintain all information in connection with this Letter of Intent and the business combination transactions confidential. All obligations regarding confidentiality will survive termination of this Letter of Intent.

8.

General

This letter will be governed by and construed in accordance with the laws of the State of Nevada. Pubco and Logicquest submit to the jurisdiction of the courts of the State of Nevada with respect to any matters arising out of this letter.

This letter will not constitute an offer capable of acceptance. Upon the written confirmation of the general terms and conditions set out in this letter by the parties to whom it is addressed, it will constitute a non-legally binding memorandum of understanding (except for paragraphs 4, 6 and 7) between us with respect to the principal terms and conditions to be included in a definitive agreement.

If you are in agreement with the foregoing, please confirm that this letter accurately sets forth your understanding of the terms of the proposed Transaction and the other matters set forth herein, by signing a copy of this letter below and returning it to us prior to 5:00 p.m. (P.S.T. time) on April 8, 2016 failing which this letter shall be null and void.

This letter may be executed in any number of counterparts, each of when executed and delivered (including by way of facsimile) is an original but all of which taken together shall constitute one and the same instrument.

We look forward to working together. 

Yours very truly,

LOGICQUEST TECHNOLOGY INC.

Agreed and confirmed this 1st day of April, 2016.

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