Document:

Exhibit 10.1

 

STOCK PURCHASE AGREEMENT

 

dated

 

September 16, 2014

 

by and among

 

CIS Acquisition Ltd., a British Virgin Islands
company,

 

as Buyer,

 

and

 

Elite Ride Limited, a British Virgin Islands
company,

 

and

 

Delta Advanced Materials Limited, a Hong
Kong company,

 

as the Company,

 

and

 

The Elite Ride Limited Shareholders (as
defined herein)

 

    	 

    	 

    

 

TABLE OF CONTENTS

 

	 	 	Page
	 	 	 
	ARTICLE I DEFINITIONS	1
	 	 
	ARTICLE II PURCHASE AND SALE	9
	2.1	Purchase and Sale	9
	2.2	Purchase Price	9
	2.3	Payment of the Purchase Price	10
	2.4	Closing 	10
	2.5	Closing	11
	2.6	Board of Directors, Officers, and D&O Insurance	13
	2.7	Put Agreement	13
	2.8	Warrants Purchase	11
	 	 	 
	ARTICLE III REPRESENTATIONS AND WARRANTIES OF THE COMPANY	13
	3.1	Corporate Existence and Power	14
	3.2	Authorization	14
	3.3	Governmental Authorization	14
	3.4	Non-Contravention	15
	3.5	Capitalization	15
	3.6	Organizational Documents	16
	3.7	Corporate Records	16
	3.8	Affiliates	16
	3.9	Assumed Names	16
	3.10	Subsidiaries	17
	3.11	Consents	17
	3.12	Financial Statements	17
	3.13	Books and Records	17
	3.14	Absence of Certain Changes	18
	3.15	Properties; Title to the Company and its Subsidiaries’ Assets	18
	3.16	Litigation	19
	3.17	Contracts	19
	3.18	Insurance	20
	3.19	Licenses and Permits	21
	3.20	Compliance with Laws	21
	3.21	Intellectual Property	22
	3.22	Accounts Receivable; Loans	23
	3.23	Pre-payments	23
	3.24	Employees	23
	3.25	Employment Matters	23
	3.26	Withholding	25

 

    	i

    	 

    

 

	 	 	Page
	 	 	 
	3.27	Employee Benefits and Compensation	25
	3.28	Real Property	26
	3.29	Accounts	27
	3.30	Tax Matters	27
	3.31	Environmental Laws	29
	3.32	[Intentionally Left Blank]	30
	3.33	Powers of Attorney	30
	3.34	Certain Business Practices	30
	3.35	Money Laundering Laws	30
	3.36	OFAC	30
	3.37	No Other Representations or Warranties	30
	 	 	 
	ARTICLE IV REPRESENTATIONS AND WARRANTIES OF ELITE	31
	4.1	Authorization	31
	4.2	Ownership of Equity Interests	31
	4.3	Conveyance	31
	4.4	Non-Contravention	32
	 	 	 
	ARTICLE V REPRESENTATIONS AND WARRANTIES OF BUYER	32
	5.1	Corporate Existence and Power	32
	5.2	Corporate Authorization	32
	5.3	Governmental Authorization	32
	5.4	Non-Contravention	33
	5.5	Finders’ Fees	33
	5.6	Issuance of Equity Interests	33
	5.7	Capitalization	33
	5.8	Information Supplied	33
	5.9	Trust Fund	34
	5.10	Board Approval; Tender Offer	34
	5.11	Buyer SEC Documents and Buyer Financial Statements	34
	5.12	Absence of Certain Changes	36
	5.13	Tax Matters	36
	5.14	Employee Benefit Plans	37
	5.15	Employee Matters	37
	5.16	Material Contracts	37
	5.17	Litigation	37
	5.18	Transactions with Affiliates	37
	5.19	Investment Company Act	37
	5.20	Disclosure of Information	38
	 	 	 
	ARTICLE VI COVENANTS OF THE COMPANY AND  ELITE PENDING CLOSING	38
	6.1	Conduct of the Business	38
	6.2	Notices of Certain Events	41
	6.3	SEC Filings	41
	6.4	Financial Information	42
	6.5	Employees of the Company	42

 

    	ii

    	 

    

 

	 	 	Page
	 	 	 
	6.6	Delivery of documents	42
	6.7	Exclusivity	42
	6.8	Commercially Reasonable  Efforts to Obtain Consents	42
	6.9	Annual Financial Statements	43
	6.10	Suspensions	43
	 	 	 
	ARTICLE VII COVENANTS OF BUYER	43
	7.1	Conduct of the Business	43
	7.2	Trust Account	45
	7.3	Filings	45
	 	 	 
	ARTICLE VIII COVENANTS OF ALL PARTIES HERETO	45
	8.1	Confidentiality	45
	8.2	Access to Information	46
	8.3	Injunctive Relief	46
	8.4	Commercially Reasonable  Efforts; Further Assurances	46
	8.5	Notification of Certain Matters	46
	8.6	Tax Matters	47
	8.7	Compliance with IPO Agreements	49
	8.8	Tender Offer	49
	8.9	Registration Rights Agreement	50
	8.10	Trust Account	50
	 	 	 
	ARTICLE IX CONDITIONS TO CLOSING	50
	9.1	Condition to the Obligations of the Parties	50
	9.2	Conditions to Obligations of Buyer	50
	9.3	Conditions to Obligations of the Company and ELITE	52
	 	 	 
	ARTICLE X INDEMNIFICATION	53
	10.1	Indemnification Obligation of the Company	53
	10.2	Indemnification Obligation of ELITE	53
	10.3	Indemnification Obligation of Buyer.	54
	10.4	Limitations on Indemnification.	54
	10.5	Indemnification Procedures; Defense of Third-Party Claims	55
	10.6	Payment of Indemnification	56
	10.7	Survival of Indemnification Rights	56
	10.8	Exclusive Remedy	56
	 	 	 
	ARTICLE XI DISPUTE RESOLUTION	56
	11.1	Arbitration	56
	11.2	Waiver of Jury Trial; Exemplary Damages	58
	11.3	Attorneys’ Fees	58
	 	 	 
	ARTICLE XII TERMINATION	58
	12.1	Termination Without Default; Termination Fee	58
	12.2	Termination Upon Default	59
	12.3	Survival	60

 

    	iii

    	 

    

 

	 	 	Page
	 	 	 
	ARTICLE XIII MISCELLANEOUS	60
	13.1	Notices	60
	13.2	Amendments; No Waivers; Remedies	61
	13.3	Arms’ length bargaining; no presumption against drafter	61
	13.4	Publicity	61
	13.5	Expenses	61
	13.6	No Assignment or Delegation	61
	13.7	Governing Law	62
	13.8	Counterparts; facsimile signatures	62
	13.9	Entire Agreement	62
	13.10	Severability	62
	13.11	Construction of certain terms and references; captions	62
	13.12	Further Assurances	63
	13.13	Third Party Beneficiaries	63
	13.14	Waiver	63

 

    	iv

    	 

    

 

STOCK PURCHASE AGREEMENT

 

This STOCK PURCHASE
AGREEMENT (the “Agreement”), dated as of September 16, 2014, by and among CIS Acquisition Ltd., a British
Virgin Islands company (“Buyer”), Elite Ride Limited, a British Virgin Islands company
(“Elite”), Delta Advanced Materials Limited (the “Company”), and the shareholders of Elite
(the “Elite Shareholders”).

 

WITNESSETH:

 

		A.	On the Closing Date (as defined herein), Elite shall have 45,500 ordinary shares (the “Elite
Shares”) issued and outstanding, all of which will held by the Elite Shareholders. Each Shareholder will be the record and
beneficial owner of the number of ordinary shares of Elite as shall be set forth opposite such Shareholder’s name on Schedule
I hereto, which shall be completed prior to the Closing Date. Each Shareholder will have agreed to transfer all of his, her
or its (hereinafter “its”) Elite Shares in exchange for a number of newly issued shares of Buyer Common Stock
as shall be specified in Section 2.2 below.

 

		B.	Elite is a beneficial owner of 100% of the issued and outstanding equity interests of the Company;
and

 

		C.	The Company, through its subsidiaries, is primarily engaged in the production of certain chemical
products in China (which is referred to hereinafter as the “Business”).

 

The parties
accordingly agree as follows:

 

ARTICLE I

DEFINITIONS

 

The following terms,
as used herein, have the following meanings:

 

1.1           “Acquisition
Proposal” means any proposal or offer, or indication of interest in making an offer or proposal, from any Person or group
at any time relating to (i) an issuance of Equity Interests or securities exchangeable for or convertible into Equity Interests,
or a merger or sale of assets in each case that is in violation of Section 6.1 hereof or (ii) an issuance of the capital stock
or other equity interests of Elite, or any merger or sale of assets of Elite that in each case would result in the breach or inaccuracy
of the representations and warranties of Elite in any material respect as of the Closing Date.

 

1.2           “Action”
means any legal action, suit, claim, investigation, hearing or proceeding, including any audit, claim or assessment for Taxes.

 

1.3           “Additional
Agreements” mean the Escrow Agreement, the Voting Agreement, the Registration Rights Agreement, and the Call Agreement.

 

    	 

    	 

    

 

1.4           “Affiliate”
means, with respect to any Person, any other Person directly or indirectly Controlling, Controlled by, or under common Control
with such Person. For avoidance of any doubt, (a) with respect to all periods prior to the Closing, Elite is an Affiliate of the
Company and its Subsidiaries, and (ii) with respect to all periods subsequent to the Closing, Buyer is an Affiliate of the Company
and its Subsidiaries.

 

1.5           “Antitrust
Laws” is defined in Section 8.4.

 

1.6           “Arbitrator”
is defined in Section 11.1.

 

1.7           “Authority”
means any governmental, regulatory or administrative body, agency or authority, any court or judicial authority, any arbitrator,
or any public, private or industry regulatory authority, whether international, national, Federal, state, or local.

 

1.8           “Basket”
is defined in Section 10.1.

 

1.9           “Books
and Records” means all books and records, ledgers, employee records, customer lists, files, correspondence, and other
records of every kind (whether written, electronic, or otherwise embodied) owned or used by a Person or in which a Person’s
assets, the Business or its transactions are otherwise reflected, other than stock books and minute books.

 

1.10         [Intentionally Left Blank].

 

1.11         [Intentionally
Left Blank].

 

1.12         “Business”
is defined in the Recitals.

 

1.13         “Business
Day” means any day other than a Saturday, Sunday or a legal holiday on which commercial banking institutions in New York
are authorized to close for business.

 

1.14         “Buyer
Material Adverse Effect” means a material adverse effect on the ability of Buyer to perform its obligations under this
Agreement or to consummate the transactions contemplated hereby on a timely basis.

 

1.15         “Buyer”
is defined in the Preamble.

 

1.16         “Buyer
Common Stock” means, prior to the date the classes of ordinary shares are consolidated, the Class C ordinary shares,
$0.001 par value per share, of Buyer and, after the consolidation of all of the classes of Buyer ordinary shares, the ordinary
shares, $0.001 par value per share, of Buyer.

 

1.17         “Buyer
Financials” is defined in Section 5.11.

 

1.18         “Buyer
Indemnitees” is defined in Section 10.1.

 

1.19         “Buyer
SEC Documents” is defined in Section 5.11.

 

    	6

    	 

    

 

1.20         “Buyer’s
IPO” means the Buyer’s initial public offering.

 

1.21         “Buyer
Organizational Documents” is defined in Section 5.8.

 

1.22         “Call
Agreement” is defined in Section 2.7.

 

1.23         
“Closing” is defined in Section 2.14.

 

1.24         “Closing
Date” is defined in Section 2.9.

 

1.25         “Closing
Payment” is defined in Section 2.4.

 

1.26         “Code”
means the Internal Revenue Code of 1986, as amended, and the regulations thereunder.

 

1.27         “Company”
is defined in the Preamble.

 

1.28         “Company
Consents” is defined in Section 3.11.

 

1.29         “Confidentiality,
Non-Competition and Non-Solicitation Agreements” is defined in Section 6.5.

 

1.30         “Contracts”
means the Leases and all contracts, agreements, leases (including equipment leases, car leases and capital leases), licenses, commitments,
client contracts, statements of work (SOWs), sales and purchase orders and similar instruments, oral or written, to which the Company
or any of its Subsidiaries is a party or by which any of its respective assets are bound, including all rights and benefits thereunder
with respect to all cash and other property of third parties under the Company or any of its Subsidiaries’ dominion or control

 

1.31         “Control”
of a Person means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies
of such Person, whether through the ownership of voting securities, by contract, or otherwise. “Controlled”, “Controlling”
and “under common Control with” have correlative meanings. Without limiting the foregoing a Person (“Controlled
Person”) shall be deemed Controlled by (a) any other Person (“10% Owner”) (i) owning beneficially, as meant in
Rule 13d-3 under the Exchange Act, securities entitling such Person to cast 10% or more of the votes for election of directors
or equivalent governing authority of the Controlled Person or (ii) entitled to be allocated or receive 10% or more of the profits,
losses, or distributions of the Controlled Person; (b) an officer, director, general partner, partner (other than a limited partner),
manager, or member (other than a member having no management authority that is not a 10% Owner ) of the Controlled Person; or (c)
a spouse, parent, lineal descendant, sibling, aunt, uncle, niece, nephew, mother-in-law, father-in-law, sister-in-law, or brother-in-law
of an Affiliate of the Controlled Person or a trust for the benefit of an Affiliate of the Controlled Person or of which an Affiliate
of the Controlled Person is a trustee.

 

1.32         [Intentionally
Left Blank].

 

    	7

    	 

    

  

1.33         [Intentionally
Left Blank].

 

1.34         “Environmental
Laws” is defined in Section 3.30.

 

1.35         “Equity
Interests” means all outstanding units, membership interests, shares or other equity securities of Elite.

 

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

 

1.37         “Escrow
Agent” means Loeb & Loeb LLP, or such other Person mutually agreed upon by Elite and the Buyer.

 

1.38         “Escrow
Agreement” means the Escrow Agreement to be entered into by and among Elite, the Buyer and the Escrow Agent relating
to the distribution of the Escrow Shares in a form to be mutually agreed upon by the parties thereto prior to Closing.

 

1.39         “Escrow
Shares” is defined in Section 2.3.

 

1.40         “Exchange
Act” means the Securities Exchange Act of 1934, as amended.

 

1.41         “Expiration
Date” is defined in Section 10.7.

 

1.42         “FIRPTA
Certificate” is defined in Section 9.2(h).

 

1.43         [Intentionally
Left Blank].

 

1.44         [Intentionally
Left Blank].

 

1.45         “IFRS”
means Internationally-recognized Financial Reporting Standards, consistently applied.

 

1.46         “Hazardous
Material” means: (a) any material, substance, chemical, waste, product, derivative, compound, mixture, solid, liquid,
mineral or gas, in each case, whether naturally occurring or manmade, that is hazardous, acutely hazardous, toxic, or words of
similar import or regulatory effect under Environmental Laws; and (b) any petroleum or petroleum-derived products, radon, radioactive
materials or wastes, asbestos in any form, lead or lead-containing materials, urea formaldehyde foam insulation, and polychlorinated
biphenyls.

 

    	8

    	 

    

 

1.47         “Indebtedness”
means with respect to any Person, (a) the unpaid principal amount of and accrued interest on all indebtedness for borrowed money,
(b) all obligations evidenced by bonds, debentures, notes or similar instruments, (c) all obligations under conditional sale or
other title retention agreements relating to property purchased, (d) all obligations for deferred purchase price of property or
services (other than accounts payable to creditors for goods and services incurred in the ordinary course of business), (e) all
obligations of such Person under leases required in accordance with IFRS to be capitalized on a balance sheet of such Person, and
(d) all guarantees of such Person in respect of clauses (a) and (b) above, including guarantees secured by any lien on or security
interest in property of such Person. Notwithstanding the foregoing, “Indebtedness” shall not include (i) any letters
of credit to the extent not drawn upon, (ii) any bank guarantees, (iii) non-cancellable purchase commitments, (iv) surety bonds
and performance bonds, and (v) any intercompany Indebtedness between or among such Person and its direct and indirect Subsidiaries.

 

1.48         “Indemnified
Party” is defined in Section 10.5.

 

1.49         “Indemnifying
Parties” is defined in Section 10.5.

 

1.50         
“Intellectual Property Right” means any trademark, service mark, registration thereof or application for registration
therefor, trade name, license, invention, patent, patent application, trade secret, trade dress, know-how, copyright, copyrightable
materials, copyright registration, application for copyright registration, software programs, data bases, corporate names, u.r.l.s.,
and any other type of proprietary intellectual property right, and all embodiments and fixations thereof and related documentation,
registrations and franchises and all additions, improvements and accessions thereto, and with respect to each of the forgoing items
in this definition, which is owned or licensed or filed by the Company, any of its Subsidiaries, or any of their Affiliates, or
used or held for use in the Business, whether registered or unregistered or domestic or foreign, but excluding licenses for generally
available, off-the-shelf software that is licensed pursuant to commercial terms and conditions, including shrink-wrap licenses.

 

1.51         [Intentionally
Left Blank].

 

1.52         “IRS”
means the Internal Revenue Service.

 

1.53         [Intentionally
Left Blank].

 

1.54         “Labor
Agreements” is defined in Section 3.24(a).

 

1.55         “Law”
means any domestic or foreign, Federal, state, municipality or local law, statute, ordinance, code, rule, or regulation or common
law.

 

1.56         “Leases”
means the leases with respect to the Real Property leased by the Company or any of its Subsidiaries as set forth on Schedule 3.28
attached hereto, together with all fixtures and improvements erected on the premises leased thereby.

 

1.57         “Lien”
means, with respect to any asset, any mortgage, lien, pledge, charge, security interest or encumbrance of any kind in respect of
such asset, and any conditional sale of such asset or voting agreement or proxy with respect to such asset, and any agreement to
grant any of the foregoing (other than restrictions on transfer imposed by the Securities Act (or any other applicable securities
Laws)).

 

1.58         “Loss(es)”
is defined in Section 10.1.

 

    	9

    	 

    

 

1.59         “Material
Adverse Effect” means (i) (a) a material adverse effect on the assets, liabilities, financial condition or results of
operations of the Business, individually or as a whole, or (b) a material adverse effect on the ability of the Company to perform
its obligations under this Agreement or to consummate the transactions contemplated hereby on a timely basis, provided, however
that any occurrence, state of facts, change, event, effect or circumstance resulting from any of the following shall be not be
deemed in themselves, either alone or in combination, to constitute, a Material Adverse Effect; (ii) global, national or regional
political conditions, including hostilities, acts of war, sabotage or terrorism or military actions or any escalation, worsening
or diminution of any such hostilities, acts of war, sabotage or terrorism or military actions existing or underway as of the date
hereof, except to the extent that the effect of such change or condition disproportionately affects the Company and its Subsidiaries,
taken as a whole, compared to similar businesses in the United States generally; (iii) any change affecting the United States
economy generally or the economy of any region in which such entity conducts business that is material to the business of such
entity, including changes in the credit, debt or financial or capital markets (including changes in interest or exchange rates),
except to the extent that the effect of such change or condition disproportionately affects the Company and its Subsidiaries, taken
as a whole, compared to similar businesses in the United States generally; (iv) changes in IFRS or other accounting requirements
or principles or any changes in applicable Laws or the interpretation or enforcement thereof, including by the Financial Accounting
Standards Board; (v) compliance with the terms of, or taking any action permitted by, this Agreement or with the consent of Buyer;
or (vi) actions required to be taken under applicable Laws or Contracts.

 

1.60         “Material
Contract” is defined in Section 3.17.

 

1.61         [Intentionally Left Blank].

 

1.62         [Intentionally
Left Blank].

 

1.63         [Intentionally
Left Blank].

 

1.64         “Minimum
Trust Amount” is defined in Section 5.9.

 

1.65         “Money
Laundering Laws” is defined in Section 3.33.

 

1.66         “OFAC”
is defined in Section 3.34.

 

1.67         [Intentionally Left Blank].

 

1.68         [Intentionally Left Blank].

 

1.69         [Intentionally
Left Blank].

 

1.70         “Order”
means any decree, order, judgment, writ, award, injunction, rule or consent of or by an Authority.

 

1.71         “Outside
Closing Date” is defined in Section 12.1.

 

    	10

    	 

    

 

 

1.72         [Intentionally Left Blank].

 

1.73         “PCAOB”
means the Public Company Accounting Oversight Board.

 

1.74         “Permits”
is defined in Section 3.18.

 

1.75         “Permitted
Liens” means (i) all defects, exceptions, restrictions, easements, rights of way and encumbrances disclosed in policies
of title insurance which have been made available to Buyer; (ii) mechanics’, carriers’, workers’, repairers’
and similar Liens arising or incurred in the ordinary course of business that are not material to the Business, operations and
financial condition of the Company or any of its Subsidiaries so encumbered and that are not resulting from a breach, default or
violation by the Company or any of its Subsidiaries of any Contract or Law; and (iii) zoning, entitlement and other land use
and environmental regulations by any Authority, provided that such regulations have not been violated.

 

1.76         “Person”
means an individual, corporation, partnership (including a general partnership, limited partnership or limited liability partnership),
limited liability company, association, trust or other entity or organization, including a government, domestic or foreign, or
political subdivision thereof, or an agency or instrumentality thereof.

 

1.77         “Plan”
is defined in Section 3.26(a).

 

1.78         “Pre-Closing
Period” means any period that ends on or before the Closing Date, or with respect to a period that includes but does
not end on the Closing Date, the portion of such period through and including the day of the Closing.

 

1.79         “Prospectus”
is defined in Section 13.14.

 

1.80         “Purchase
Price” is defined in Section 2.2.

 

1.81         “Real
Property” means, collectively, all real properties and interests therein (including the right to use), together with
all buildings, fixtures, trade fixtures, plant and other improvements located thereon or attached thereto; all rights arising out
of use thereof (including air, water, oil and mineral rights); and all subleases, franchises, licenses, permits, easements and
rights-of-way which are appurtenant thereto.

 

1.82         “Registration
Rights Agreement” is defined in Section 8.9.

 

1.83         “Restrictive
Covenants” is defined in Section 8.3.

 

1.84         [Intentionally Left Blank].

 

1.85         [Intentionally Left Blank].

 

1.86         “Sarbanes-Oxley
Act” is defined in Section 5.11.

 

1.87         “Form
6K” is defined in Section 8.8(c).

 

    	11

    	 

    

  

1.88         “SEC”
means the Securities and Exchange Commission.

 

1.89         “Securities
Act” means the Securities Act of 1933, as amended.

 

1.90         “Stock
Certificate” is defined in Section 2.4.

 

1.91         “Subsidiary”
means, with respect to any holder of equity securities, any entity of which at least fifty percent (50%) of the capital stock or
other equity or voting securities are Controlled or owned, directly or indirectly, by such holder.

 

1.92         “Tangible
Assets” means all tangible personal property and interests therein, including machinery, computers and accessories, furniture,
office equipment, communications equipment, vehicles automobile[s], trucks, forklifts and other vehicles owned/leased by the Company,
or any of its Subsidiaries and other tangible property, including the items listed on Schedule 3.15;

 

1.93         “Tax(es)”
means any federal, state, local or foreign tax, charge, fee, levy, custom, duty, deficiency, or other assessment of any kind or
nature imposed by any Taxing Authority (including any income (net or gross), gross receipts, profits, windfall profit, sales, use,
goods and services, ad valorem, franchise, license, withholding, employment, social security, workers compensation, unemployment
compensation, employment, payroll, transfer, excise, import, real property, personal property, intangible property, occupancy,
recording, minimum, stamp, severance, alternative minimum, environmental or estimated tax), including any liability therefor as
a transferee (including under Section 6901 of the Code or similar provision of applicable Law) or successor, as a result of Treasury
Regulation Section 1.1502-6 or similar provision of applicable Law or as a result of any Tax sharing, indemnification or similar
agreement, together with any interest, penalty, additions to tax or additional amount imposed with respect thereto; provided, however,
that the term “Taxes” shall not include utility (e.g. water or sewer) charges or fees.

 

1.94         “Taxing
Authority” means the IRS and any other Authority responsible for the collection, assessment or imposition of any Tax
or the administration of any Law relating to any Tax.

 

1.95         “Tax
Benefit” shall mean, with respect to any taxable year or period, the excess of (a) the hypothetical aggregate
Tax liability that would have been reported on the applicable Tax Return of the Company and its Affiliates for such taxable
year or period, determined as if the Loss subject to indemnification had not been incurred, over (b) the actual aggregate
Tax liability of the Company and its Affiliates reported on the applicable Tax Return for such taxable year or period.

 

1.96         “Tax
Return” means any return, information return, declaration, claim for refund or credit, report or any similar statement,
and any amendment thereto, including any attached schedule and supporting information, whether on a separate, consolidated, combined,
unitary or other basis, that is filed or required to be filed with any Taxing Authority in connection with the determination, assessment,
collection or payment of a Tax or the administration of any Law relating to any Tax.

 

    	12

    	 

    

  

1.97         [Intentionally Left Blank].

 

1.98         “Third-Party
Claim” is defined in Section 10.4.

 

1.99         “Trust
Account” is defined in Section 5.9.

 

1.100      “Trust
Agreement” is defined in Section 5.9.

 

1.101      “Trust
Fund” is defined in Section 5.9.

 

1.102      “Trustee”
is defined in Section 5.9.

 

1.103      “UCC”
means the Uniform Commercial Code of the State of New York, or any corresponding or succeeding provisions of Laws of the State
of New York, or any corresponding or succeeding provisions of Laws, in each case as the same may have been and hereafter may be
adopted, supplemented, modified, amended, restated or replaced from time to time.

 

ARTICLE II

PURCHASE AND SALE

 

2.1           Purchase
and Sale. Upon the terms and subject to the conditions of this Agreement, at the Closing, Buyer shall purchase from the Elite
Shareholders and the Elite Shareholders shall sell, convey, transfer, assign and deliver to Buyer the Equity Interests, free and
clear of all Liens.

 

2.2           Purchase
Price. The purchase price (the “Purchase Price”) for the Equity Interests shall be 6,060,000 shares of the
Buyer Common Stock in exchange for all outstanding securities of Elite. The number of shares of Buyer Common Stock to be received
by each Elite Shareholder shall be listed opposite each such Shareholder’s name on Schedule I. The aggregate number
of shares of Buyer Stock that will be reflected on Schedule I is referred to herein as the “Shares”.

 

2.3.          Concurrent
Stock Issuance. Concurrently with the Closing, Buyer will issue 500,000 shares of Buyer Common Stock to Kyle Shostak and CIS
Acquisition Holding Co. Ltd. (which is owned collectively by Taras Vazhnov and Anatoly Danilitskiy) (collectively, the “CIS
Sponsor”) proportionally in accordance with their respective share ownership in CIS.

 

2.4.          Payment
of the Purchase Price. The Closing Payment shall be payable by Buyer at the Closing in the form of stock certificates representing
Buyer Common Stock. The Stock Certificates representing 4,560,000 shares of the Purchase Price (the “Closing Payment”)
shall be delivered by the Buyer to the Elite Shareholders and the remaining 1,500,000 shares (the “Escrow Shares”)
of the Purchase Price shall be delivered in the form of stock certificates by the Buyer to escrow pursuant to the Escrow Agreement.
All stock certificates representing the Purchase Price are referred to herein as “Stock Certificates”. Subject
to the terms of the Escrow Agreement, the Escrow Shares shall be released from escrow if the Company’s Adjusted Net Income
(as defined) meets certain targets set forth on Exhibit A hereto as of and for each of the one year periods ending
June 30, 2015, June 30, 2016 and June 30, 2017 (“Financial Targets”).

 

    	13

    	 

    

 

The Stock Certificates
shall bear the legend set forth below together with any other legends that may be required by any securities laws at the time of
the issuance of the Stock Certificates:

 

“The
sECURITIes represented by this certificate HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED AND SUCH SECURITIES
MAY NOT BE OFFERED FOR SALE, SOLD, PLEDGED, HYPOTHECATED OR TRANSFERRED WITHOUT (1) REGISTRATION UNDER THE SECURITIES ACT OF 1933,
AS AMENDED, AND REGISTRATION OR QUALIFICATION UNDER ANY APPLICABLE STATE LAW, OR (2) AN OPINION OF COUNSEL (REASONABLY SATISFACTORY
TO THE COMPANY) THAT SUCH REGISTRATION IS NOT REQUIRED. The sECURITIes represented by this certificate are subject to certain OBLIGATIONS,
RESTRICTIONS, and voting agreements AS SET FORTH IN A CERTAIN VOTING AGREEMENT, as
amended from time to time, BY AND AMONG THE STOCKHOLDER, THE COMPANY AND CERTAIN OTHER STOCKHOLDERS, A COPY OF WHICH IS
ON FILE WITH THE SECRETARY OF THE COMPANY”

 

2.5           Use
of Cash Proceeds from Warrant Exercise. Upon exercise of the Buyer’s outstanding public warrants and warrants issued
to the CIS Sponsor, the Buyer shall distribute the proceeds of any such exercise to the Elite Shareholders as shall be specified
on Schedule I attached hereto.

 

2.6.          Additional
Shares. If the 10 trading day volume weighted average price of the Buyer Common Stock (the “VWAP”) is lower than
$5.00 per share on the principal stock exchange on which such stock is traded on the earlier to occur of (i) the 395th day after
the Closing Date and (ii) the 30th day after the SEC declares a registration statement filed by the Buyer effective during the
first 12 months after the Closing Date,  then the Buyer will issue the CIS Sponsor, proportionally in accordance with their
respective share ownership in CIS, an additional number of shares of Buyer Common Stock equal to  (i) (a) $5.00 minus the
VWAP, divided by the VWAP, multiplied by (ii) the lesser of (a) 1,500,000 and (b) the total number of shares of Buyer Common Stock
owned by CIS Sponsor on such date. For avoidance of any ambiguity, total number of Buyer Common
Stock will be reduced by the number of shares CIS Sponsor sells during 13 months post Closing.

 

2.7.         Call
Option. The Buyer and the CIS Sponsor shall enter into a Call Agreement (the “Call Agreement”) mutually acceptable
to the Buyer, Elite and the CIS Sponsor pursuant to which the Buyer shall be permitted, between the 365th and
395th after the Closing Date, to require the CIS Sponsor to sell to it, at a price of $5.00 per share, up to 1,500,000
shares of Buyer Common Stock. The Call Agreement shall contain a provision prohibiting the CIS Sponsor from short selling or manipulating
the Buyer’s securities.

 

2.8           Amendment
of CIS Placement Warrants. In connection with the Closing, the CIS Sponsor shall agree to amend the 4,500,000 warrants owned
by the CIS Sponsor (“Placement Warrants”) by (i) providing that such Placement Warrants may be redeemed at a price
of $17.50 per share, and (ii) providing that such Sponsor Warrants may not be exercised on a cashless basis.

 

    	14

    	 

    

 

2.9           Closing.
Unless this Agreement shall have been terminated pursuant to Article XII, subject to the satisfaction or waiver of the conditions
set forth in Article IX, the closing (the “Closing”) of the purchase and sale of the Equity Interests shall
take place at the offices of Loeb & Loeb LLP, 345 Park Avenue, New York, New York 10154, on the Business Day after the satisfaction
or waiver of all of the conditions set forth in Article IX at 10:00 a.m. local time, or at such other date, time or place as Buyer
and Elite may agree, but in no event later than September 21, 2014 (the date and time at which the Closing is actually held being
the “Closing Date”). At the Closing, Elite shall deliver to Buyer certificates representing the Equity Interests,
duly endorsed in blank by Elite, or accompanied by stock powers duly executed in blank by Elite, with all necessary transfer Tax
and other revenue stamps, acquired at Elite’s expense, affixed.

 

2.10         Board
of Directors, Officers, and D&O Insurance.

 

(a)           Immediately
after the Closing, the Buyer’s board of directors will consist of five (5) directors, composed of four (4) nominees designated
by Elite, of which at least two (2) designees shall qualify as an independent director under the Exchange Act, and the rules of
the Nasdaq Stock Market, if applicable, and one (1) nominee designated by Buyer, who shall qualify as an independent director under
the Exchange Act, and the rules of the Nasdaq Stock Market, if applicable. The parties to this Agreement shall enter into a mutually
agreed upon voting agreement relating to nominees to the Buyer’s board of directors for a period of 13 months following the
Closing (the “Voting Agreement”).

 

Promptly following
the Closing, the Buyer will use commercially reasonable efforts to purchase a directors’ and officers’ liability insurance
policy for a minimum coverage amount of $5.0 million for the directors’ and officers’ of Buyer, which will cover the
directors and officers for a period of at least three (3) years after the Closing. The policy will be paid for with funds made
available in connection with the Closing.

 

ARTICLE III

REPRESENTATIONS AND WARRANTIES OF ELITE AND THE COMPANY

 

Except as set forth in
the corresponding section of the disclosure schedules to be delivered to the Buyer prior to the Closing Date (the “Company
Disclosure Schedules”) (with the disclosures in any section or subsection of the disclosure schedules qualifying the
other sections and subsections in this ARTICLE III only to the extent it is readily apparent from a reading of the disclosure that
such disclosure is applicable to such other sections and subsections), the Company and Elite, jointly and severally, hereby represents
and warrants to Buyer that each of the following representations and warranties is true, correct and complete as of the date of
this Agreement and as of the Closing Date:

 

3.1           Corporate
Existence and Power. Each of Elite and the Company is duly organized, validly existing and in good standing under the laws
of the jurisdiction in which it is organized. Each of Elite and the Company has all power and authority, corporate and otherwise,
and all governmental licenses, franchises, Permits, authorizations, consents and approvals required to own and operate its properties
and assets, and to carry on the Business as presently conducted. Each of Elite and the Company is not qualified to do business
as a foreign entity in any jurisdiction, except as set forth on Schedule 3.1(a), and there is no other jurisdiction in which the
character of the property owned or leased by the Company or the nature of its activities make qualification of each of Elite and
the Company in any such jurisdiction necessary, except where the failure to do so would not have a Material Adverse Effect. Each
of Elite and the Company’s principal executive offices are located at the address set forth on Schedule 3.1(a). Except as
otherwise provided for in this Agreement, neither Elite nor the Company has taken any action, adopted any plan, or made any agreement
or commitment in respect of any merger, consolidation, sale of all or substantially all of its assets, reorganization, recapitalization,
dissolution or liquidation.

 

    	15

    	 

    

 

3.2           Authorization. The execution, delivery and performance by Elite and the Company
of this Agreement and the Additional Agreements and the consummation by Elite and the Company of the transactions contemplated
hereby and thereby are within the powers of Elite and the Company and have been duly authorized by all necessary action on the
part of Elite and the Company, including the approval of any security holders, if applicable. This Agreement constitutes, and,
upon their execution and delivery, each of the Additional Agreements will constitute, a valid and legally binding agreement of
Elite and the Company enforceable against Elite and the Company in accordance with their respective terms.

 

(b)           Elite
and the Company each have full legal capacity, power and authority to execute and deliver this Agreement and the Additional Agreements
to which it is named as a party, to perform such obligations hereunder and thereunder and to consummate the transactions contemplated
hereby and thereby. This Agreement has been, and the Additional Agreements to which each of Elite and the Company is named as a
party, will be at Closing, duly executed and delivered by Elite and this Agreement constitutes, and such Additional Agreements
are, or upon their execution and delivery at Closing will be, valid and legally binding agreements of Elite and the Company, enforceable
against it in accordance with their respective terms.

 

3.3           Governmental
Authorization. No consent, approval or authorization of, or declaration or filing with, or notice to, any Authority is required
to be made by either Elite or the Company in connection with the execution and delivery of this Agreement by Elite and the Company
or the consummation by Elite and the Company of any of the transactions contemplated hereby, except for (a) those consents, approvals,
authorizations, declarations, filings or notices set forth in Schedule 3.3, (b) notices and filings under applicable federal and
state securities laws, and (c) such other consents, approvals, authorizations, declarations, filings or notices which the failure
to obtain or make would not reasonably be expected to have a Material Adverse Effect.

 

3.4           Non-Contravention.
Provided those consents, approvals, authorizations, declarations filings or notices set forth on Schedule 3.3 or otherwise described
in Section 3.3 are obtained or made, as applicable, the execution, delivery and performance by Elite and the Company of this Agreement
and any Additional Agreements to which it is a party does not, and the consummation of the transactions contemplated hereby will
not (a) contravene or conflict with the organizational documents of Elite and the Company, or any of its Subsidiaries, (b) contravene
or conflict with or constitute a violation of any provision of any Law or Order binding upon or applicable to Elite and the Company
or any of its Subsidiaries, or any of the Equity Interests, (c) except for the Material Contracts listed on Schedule 3.171, require
Company Consents (but only as to the need to obtain such Company Consents), constitute a default under or breach of (with or without
the giving of notice or the passage of time or both) or violate or give rise to any right of termination, cancellation, amendment
or acceleration of any right or obligation of Elite and the Company, or any of its Subsidiaries or require any payment or reimbursement
or to a loss of any material benefit relating to the Business to which Elite and the Company, or any of its Subsidiaries is entitled
under any provision of any material Permit, Material Contract or other instrument or obligations binding upon Elite and the Company,
or any of its Subsidiaries or by which any of the Equity Interests or any of Elite and the Company assets is or may be bound or
any material Permit, or (d) result in the creation or imposition of any Lien on any of the Equity Interests or Elite and the Company’s
assets, including the assets of any of its Subsidiaries, other than Permitted Liens on the Company’s assets.

 

    	16

    	 

    

  

3.5           Capitalization.

 

(a)          The
Company has an authorized capitalization as set forth on Schedule 3.5. All the Equity Interests have been duly authorized and validly
issued, are fully paid and non-assessable and have not been issued in violation of any preemptive or similar rights of any Person.
All of the issued and outstanding capital stock of the Company shall be owned of record and beneficially by BVI Shareholders as
shall be set forth on Schedule I hereto, which shall be completed prior to the Closing Date. Upon the Closing, Buyer shall
receive good, valid and marketable title to all Equity Interests, free and clear of all Liens. The only Equity Interests that will
be outstanding immediately after the Closing will be the Equity Interests owned by Buyer. No other class of capital stock of the
Company is authorized or outstanding. Except as set forth on Schedule 3.5(a), there are no: (a) outstanding subscriptions, options,
warrants, rights (including “phantom stock rights”), calls, commitments, understandings, conversion rights, rights
of exchange, plans or other agreements of any kind providing for the purchase, issuance or sale of any shares of the capital stock
of the Company, or (b) agreements by Elite and the Company with respect to any of the Equity Interests, including any voting trust,
other voting agreement or proxy with respect thereto.

 

(b)          The
capitalization of each Subsidiary of Elite and the Company is listed on Schedule 3.5(b). Except as set forth on Schedule 3.5(b)
with respect to each Subsidiary, there are no: (a) outstanding shares of capital stock, (b) subscriptions, options, warrants, rights
(including “phantom stock rights”), calls, commitments, understandings, conversion rights, rights of exchange, plans
or other agreements of any kind providing for the purchase, issuance or sale of any shares of the capital stock of such Subsidiary,
or (c) agreements by Elite and the Company with respect to any of the shares of such Subsidiary, including any voting trust, other
voting agreement or proxy with respect thereto.

 

3.6           Organizational
Documents. Copies of the articles of association or comparable document of formation of Elite, the Company and each of its
Subsidiaries, as certified by the secretary or other appropriate officer of BVI or the Company, have heretofore been made available
to Buyer, and such copies are each true and complete copies of such instruments as amended and in effect on the date hereof. Neither
Elite, the Company nor any of its Subsidiaries has taken any action in violation or derogation of its articles of association or
comparable document of formation, articles of association or comparable company organizational document.

 

    	17

    	 

    

 

3.7           Corporate
Records. The minute books of Elite and the Company, which have been provided to the Buyer for review on or prior to the date
of this Agreement, contain true, correct and complete minutes and records of all meetings, proceedings and other actions of the
shareholders, Board of Directors and committees of such Board of Directors of Elite and the Company, if any, and, on the Closing
Date, will contain true, correct and complete minutes and records of any meetings, proceedings and other actions of the shareholders,
Board of Directors and committees of such Board of Directors of Elite and the Company .

 

3.8           Affiliates.
Schedule 3.8 sets forth as of the date hereof, Affiliates of Elite and the Company. Neither Elite nor the Company is Controlled
as of the date hereof by any Persons other than those set forth on Schedule 3.8. Schedule 3.8 lists each Contract to which Elite,
the Company and/or any of its Subsidiaries, on the one hand, and an Affiliate of Elite and/or the Company (or any officer, director,
or manager of such Affiliate of Elite and/or the Company), on the other hand, is a party, but shall exclude Contracts between Elite,
the Company and any of its Subsidiaries. Except as set forth on Schedule 3.8, Elite nor any Affiliate of Elite (i) owns, directly
or indirectly, in whole or in part, any tangible or intangible property (including Intellectual Property Rights) that the Company
or any of its Subsidiaries uses or the use of which is necessary for the conduct of the Business or the ownership or operation
of any of the Company or its Subsidiaries’ assets, including without limitation the Real Property, or (ii) has engaged in
any transactions with the Company or any of its Subsidiaries.

 

3.9           Assumed
Names. Schedule 3.9 is a complete and correct list of all assumed or “doing business as” names currently or, since
June 30, 2014, used by Elite, the Company or any of its Subsidiaries, including names on any Websites. Since June 30, 2014, none
of Elite, the Company or any of its Subsidiaries has used any name other than the names listed on Schedule 3.9 to conduct the Business.

 

3.10         Subsidiaries.

 

(a)           Except
as set forth on Schedule 3.10, Elite and the Company does not currently own or within the past five (5) years has owned directly
or indirectly, securities or other ownership interests in any other entity. Except as set forth on Schedule 3.10, as of the date
hereof and as of the Closing Date, each of Elite and the Company has good, valid and marketable title to (other than restrictions
on transfer imposed by applicable securities Laws), directly or indirectly, all of the capital stock and other equity interests
of its Subsidiaries, free and clear of all Liens.

 

(b)           Each
Subsidiary of the Company is a company duly organized, validly existing and in good standing under and by virtue of the Laws of
the jurisdiction of its formation set forth by its name on Schedule 3.10. Each Subsidiary has all power and authority, corporate
and otherwise, and all governmental licenses, franchises, Permits, authorizations, consents and approvals required to own and operate
its properties and assets, and to carry on the Business as presently conducted. No Subsidiary is qualified to do business as a
foreign entity in any jurisdiction, except as set forth by its name on Schedule 3.10, and there is no other jurisdiction in which
the character of the property owned or leased by any Subsidiary or the nature of its activities make qualification of such Subsidiary
in any such jurisdiction necessary, except where the failure to do so would not have a Material Adverse Effect. Each Subsidiary
has offices located only at the addresses set forth by its name on Schedule 3.10. No Subsidiary has taken any action, adopted any
plan, or made any agreement or commitment in respect of any merger, consolidation, sale of all or substantially all of its assets,
reorganization, recapitalization, dissolution or liquidation.

 

    	18

    	 

    

  

3.11         Consents.
The Material Contracts (as defined below) are the only Material Contracts binding upon Elite, the Company and any of its Subsidiaries
or by which any of the Equity Interests or any of Elite, the Company or its Subsidiaries’ assets are bound or subject to
a Lien, requiring a consent, approval, authorization, order or other action of or filing with any Person as a result of the execution,
delivery and performance of this Agreement or any of the Additional Agreements or the consummation of the transactions contemplated
hereby or thereby (each of the foregoing, a “Company Consent”).

 

3.12         Financial
Statements. Attached hereto as Schedule 3.12 are the statutory annual financial statements of Elite for the fiscal years ended
June 30, 2012, 2013 and 2014 (the “Financial Statements”). The Financial Statements have been prepared in all
material respects in accordance with the United States generally accepted accounting principles (“GAAP”), consistently
applied, and present fairly in all material respects the financial position and results of operations of the Company as of the
time and for the period referred to therein.

 

3.13         Books
and Records.

 

(a)           The
Books and Records accurately and fairly, in reasonable detail, reflect the transactions and dispositions of assets of and the providing
of services by Elite, the Company and its Subsidiaries.

 

(b)           Elite,
the Company and its Subsidiaries have heretofore made all Books and Records available to Buyer for its inspection and have heretofore
delivered to Buyer complete and accurate copies of all documents referred to in the Schedules to this Agreement or that Buyer otherwise
has requested. All Contracts, documents, and other papers or copies thereof delivered to Buyer by or on behalf of the Company and
its Subsidiaries are accurate, complete, and authentic.

 

(c)           All
accounts, books and ledgers of Elite, the Company and its Subsidiaries have been properly and accurately kept and completed in
all material respects, and there are no material inaccuracies or discrepancies of any kind contained or reflected therein. Except
as set forth on Schedule 3.13(c), none of Elite, the Company or any of its Subsidiaries has any records, systems controls, data
or information recorded, stored, maintained, operated or otherwise wholly or partly dependent on or held by any means (including
any mechanical, electronic or photographic process, whether computerized or not) which (including all means of access thereto and
therefrom) are not under the exclusive ownership (excluding licensed software programs) and direct control of the Company or any
of its Subsidiaries and which is not located at the offices of the Company or any of its Subsidiaries.

 

3.14         Absence
of Certain Changes. Elite, the Company, and its Subsidiaries have conducted the Business in the ordinary course consistent
with past practices, and as of June 30, 2014 there has not been:

 

(a)           any
Material Adverse Effect;

 

    	19

    	 

    

 

(b)           any
transaction, Contract or other instrument entered into, or commitment made, by Elite, the Company or any of its Subsidiaries relating
to the Business or any of Elite, the Company and its Subsidiaries’ assets (including without limitation the acquisition or
disposition of Real Property) or any relinquishment by Elite, the Company or any of its Subsidiaries of any contract or other right,
in either case other than transactions and commitments in the ordinary course of business consistent with past practices and those
contemplated by this Agreement;

 

(c)           any
increase in bonus, salary or other compensation paid or agreed to be paid to any employee except (i) for annual increases in the
ordinary course of business or (ii) in accordance with Schedule 3.25(a) hereto;

 

(d)           any
creation or other incurrence of any Lien other than Permitted Liens on any Equity Interests or any of the Company or its Subsidiaries’
assets, including without limitation the Real Property; or

 

(e)           the
redemption of, declaration or payment of any dividend or other distribution with respect to the equity interests of the Company
or any of its Subsidiaries.

 

3.15         Properties;
Title to the Company and its Subsidiaries’ Assets.

 

(a)           The
Tangible Assets have no defects, are in good operating condition and repair and function in accordance with their intended uses
(ordinary wear and tear excepted) and have been properly maintained, and are suitable for their present uses. Schedule 3.15 sets
forth a complete list, setting forth a description and location, of the Tangible Assets having a value in excess of $500,000 as
of a date within five days of the date of this Agreement. Except as set forth on Schedule 3.15, all of the Tangible Assets are
located at the offices of Elite, the Company and its Subsidiaries.

 

(b)           Each
of Elite, the Company and its Subsidiaries has good, valid and marketable title in and to, or, in the case of the Lease and the
assets which are leased or licensed pursuant to Contracts, a valid leasehold interest or license in or a right to use each of its
respective assets, free and clear of all Liens other than Permitted Liens. Except as set forth in Schedule 3.15, Elite, the Company
and its Subsidiaries’ assets constitute all of the assets of any kind or description whatsoever, including goodwill, that
are used or useful in the operation of the Business.

 

3.16         Litigation.
Except as set forth on Schedule 3.16, there is no Action (or any basis therefore) pending against, or to the knowledge of Elite
and the Company, threatened against or affecting, Elite, the Company or any of its Subsidiaries, any of their officers or directors
(in their capacity as such), Elite (in its capacity as such), the Business, or any Equity Interests or any of Elite, the Company
or its Subsidiaries’ assets, including without limitation the Real Property, or any Contract before any court, Authority
or official that might result, either individually or in the aggregate, in a Material Adverse Effect, or which in any manner challenges
or seeks to prevent, enjoin, alter or delay the transactions contemplated hereby or by the Additional Agreements, other than, in
each case, Actions in the ordinary course of Business involving (i) claims or other benefits under, or in connection with the Company’s
business, (ii) subrogation recoveries, or (iii) collection of premiums. There are no outstanding judgments against Elite, the Company
or any of its Subsidiaries or Elite. Except as otherwise set forth on Schedule 3.16, none of Elite, the Company or any of its Subsidiaries
is now, nor has it been since June 30, 2014, subject to any proceeding with any Authority.

 

    	20

    	 

    

  

3.17         Contracts.

 

(a)           Each
Material Contract is a valid and binding agreement, and is in full force and effect, and neither Elite, the Company nor any of
its Subsidiaries that is party thereto nor, to the knowledge of the Company, any other party thereto, is in breach or default (whether
with or without the passage of time or the giving of notice or both) under the terms of any such Material Contract. None of Elite,
the Company or any of its Subsidiaries has assigned, delegated, or otherwise transferred any of their rights or obligations with
respect to any Material Contracts, or, except as set forth in Schedule 3.33, granted any power of attorney with respect thereto
or to any of Elite, the Company or its Subsidiaries’ assets, including without limitation the Real Property. Except as set
forth on Schedule 3.17, no Material Contract (i) requires Elite, the Company or any of its Subsidiaries to post a bond or deliver
any other form of security or payment to secure its obligations thereunder (other than bonds or other forms of security required
in connection with Actions involving claims or other benefits under, or in connection with Elite or the Company’s business,
actions for subrogation recoveries and actions involving collection of premiums) or (ii) imposes any non-competition covenants
that may be binding on, or restrict the Business or require any payments by or with respect to Buyer or any of its Affiliates.
The Buyer has been supplied with, or has been given access to (i) a true and correct copy of all written Contracts and (ii) written
summaries of each oral Contract, in each case that is referred to on Schedule 3.17 (the “Material Contracts”).

 

(b)           Except
for Contracts entered into by Elite, the Company or any Subsidiary after the date hereof and in accordance with Section 6.1, Schedule
3.17 lists the following Contracts of the Company and its Subsidiaries, oral or written, separately referencing the applicable
subsection below:

 

(i)          all
client Contracts which have generated revenues to Elite, the Company and its Subsidiaries or are expected to generate revenues
to the Company and its Subsidiaries in excess of $2,000,000 in any of the current or next two (2) fiscal years or any of the two
(2) preceding fiscal years of the Company;

 

(ii)         any
other Contract pursuant to which Elite, the Company or any of its Subsidiaries is required to pay, has paid or is entitled to receive
or has received an amount in excess of $1,000,000 during the current fiscal year or any one of the two preceding fiscal years;

 

(iii)        all
employment Contracts, employee leasing Contracts, and consultant and sales representatives Contracts;

 

(iv)        all
material sales, purchasing, agency, factoring, commission and distribution Contracts to which Elite, the Company or any of its
Subsidiaries is a party pursuant to which the Company or any of its Subsidiaries is required to pay, has paid or is entitled to
receive or has received an amount in excess of $1,000,000 during the current fiscal year or any one of the two preceding fiscal
years, with the exception of shrinkwrap or clickthrough standard terms of service agreements, and any clickthrough or “shrink
wrap” agreements and non-exclusive licenses relating to off-the-shelf, commercially available software;

 

    	21

    	 

    

  

(v)         all
ongoing agreements for purchases or receipt by Elite, the Company or any of its Subsidiaries of media, supplies, equipment, goods
or services (other than under Section 3.17(b)(ii) or (iii)), pursuant to which the Company
or any of its Subsidiaries is required to pay, has paid or is entitled to receive or has received an amount in excess of $1,000,000
during the current fiscal year or any one of the two preceding fiscal years;

 

(vi)        all
joint venture, strategic alliance, limited liability company and partnership agreements to which Elite, the Company or any of its
Subsidiaries is a party;

 

(vii)       all
significant documents relating to any acquisitions or dispositions of assets for an amount in excess of $1,000,000, including without
limitation the Real Property, by Elite, the Company or any of its Subsidiaries

 

(viii)      all
material licensing agreements, including agreements licensing Intellectual Property Rights, pursuant to which Elite, the Company
or any of its Subsidiaries is required to pay, has paid or is entitled to receive or has received an amount in excess of $100,000
during the current fiscal year or any one of the two preceding fiscal years;

 

(ix)         all
secrecy, confidentiality and nondisclosure agreements restricting the conduct of Elite, the Company or any of its Subsidiaries;

 

(x)          all
contracts relating to patents, trademarks, service marks, trade names, brands, copyrights, trade secrets and other Intellectual
Property Rights of Elite, the Company or any of its Subsidiaries;

 

(xi)         all
guarantees, indemnification arrangements and other hold harmless arrangements made or provided by Elite, the Company or any of
its Subsidiaries, including all ongoing agreements for indemnification or similar obligations, other than indemnification or subrogation
provisions contained in insurance contracts and policies, surety bonds and performance bonds and reinsurance and retrocession agreements
entered into in the ordinary course of Business;

 

(xii)        all
contracts or agreements with or pertaining to Elite, the Company or any of its Subsidiaries to which Elite or any Affiliate of
Elite is a party;

 

(xiii)       all
agreements relating to Tangible Assets listed on Schedule 3.15; and

 

(xiv)      all
agreements relating to outstanding Indebtedness in excess of $1,000,000; and

 

    	22

    	 

    

  

(xv)       all
agreements between the Company or any of its Subsidiaries and (A) Elite or (B) any Affiliate of Elite.

 

(c)           Each
of Elite, the Company and its Subsidiaries is in compliance with all covenants, including all financial covenants, in all notes,
indentures, bonds and other instruments or agreements evidencing any Indebtedness.

 

3.18         Licenses
and Permits. Except as set forth in Schedule 3.18, Elite, the Company and its Subsidiaries have all franchises, permits, orders
or approvals from Authorities that are necessary to operate its Business as now conducted (the “Permits”). Except
as set forth in Schedule 3.18, such Permits are valid and in full force and effect, and none of the Permits will, assuming the
related Company Consents and the approvals and filings set forth in Schedule 3.3 have been obtained, made or waived prior to the
Closing Date, be terminated or impaired or become terminable as a result of the transactions contemplated hereby.

 

3.19         Compliance
with Laws. Except as set forth on Schedule 3.19(a), since June 30, 2014, (i) each of Elite, the Company and its Subsidiaries
has been in compliance in all material respects with all applicable Laws, (ii) none of Elite, the Company nor its Subsidiaries
has received any written notice alleging any material violations of Laws, and (iii) to the knowledge of Elite or the Company, neither
Elite, the Company nor its Subsidiaries is under investigation with respect to or has been threatened in writing to be charged
with or given written notice of any violation or alleged violation of, any Law, or judgment, order or decree entered by any court,
arbitrator or Authority, domestic or foreign, nor, to the knowledge of the Company, is there any basis for any such charge, and
(iv) neither Elite, the Company nor any of its Subsidiaries has received any subpoenas by any Authority other than those received
in Actions in the ordinary course of Business involving (i) claims or other benefits under, or in connection with, the Company’s
business, (ii) subrogation recoveries and (iii) collection of premiums.

 

3.20         Intellectual
Property.

 

(a)           Schedule
3.20 sets forth a true, correct and complete list of all Intellectual Property Rights, specifying as to each, as applicable: (i)
the nature of such Intellectual Property Right; (ii) the owner of such Intellectual Property Right; (iii) the jurisdictions by
or in which such Intellectual Property Right has been issued or registered or in which an application for such issuance or registration
has been filed; and (iv) all licenses, sublicenses and other agreements pursuant to which any Person is authorized to use such
Intellectual Property Right.

 

(b)           Within
the past two (2) years (or prior thereto if the same is still pending or subject to appeal or reinstatement) neither Elite, the
Company nor any of its Subsidiaries has been sued or charged in writing with or been a defendant in any Action that involves a
claim of infringement of any Intellectual Property Rights, and the Company has no knowledge of any other claim of infringement
by the Company or any of its Subsidiaries, and no knowledge of any continuing infringement by any other Person of any Intellectual
Property Rights of Elite, the Company or any of its Subsidiaries.

 

(c)           To
the Company’s knowledge, the current use by Elite, the Company, its Subsidiaries and their Affiliates, of the Intellectual
Property Rights does not infringe the rights of any other Person. Any Intellectual Property used by Elite, the Company or any of
its Subsidiaries in the performance of any services under any Contract is, and upon the performance of such Contract remains, owned
by Elite, the Company or any of its Subsidiaries and no client, customer or other third-party has any claim of ownership on the
Intellectual Property.

 

    	23

    	 

    

 

(d)           Except
as disclosed on Schedule 3.20(d), all employees, agents, consultants or contractors who have contributed to or participated in
the creation or development of any copyrightable, patentable or trade secret material on behalf of Elite, the Company or any of
its Subsidiaries or any predecessor in interest thereto either: (i) is a party to a “work-for-hire” agreement under
which Elite, the Company or its Subsidiaries is deemed to be the original owner/author of all property rights therein; or (ii)
has executed an assignment or an agreement to assign in favor of Elite, the Company or its Subsidiaries (or such predecessor in
interest, as applicable) all right, title and interest in such material.

 

3.21         Accounts
Receivable; Loans.

 

(a)           All
accounts, receivables and notes of Elite, the Company and its Subsidiaries, whether reflected on Schedule 3.21 or otherwise, represent
valid obligations arising from services actually performed or goods actually sold by Elite, the Company and its Subsidiaries in
the ordinary course of business. To the knowledge of the Company, there is no contest, claim, or right of setoff in any agreement
with any maker of an account receivable or note relating to the amount or validity of such account, receivables or note. Except
as set forth on Schedule 3.21, to the knowledge of Elite, the Company, all accounts, receivables or notes are good and collectible
in the ordinary course of business. The information set forth on Schedule 3.21 separately identifies any and all accounts, receivables
or notes of the Company and its Subsidiaries which are owed by any Affiliate of the Company or any of its Subsidiaries.

 

(b)           Except
as reflected on Schedule 3.21, none of the Company or any of its Subsidiaries is indebted to any of its Affiliates and no Affiliates
are indebted to the Company or any of its Subsidiaries.

 

3.22         Pre-payments.
Except as set forth on Schedule 3.22, none of the Company or any of its Subsidiaries has received any payments with respect to
any services to be rendered or goods to be provided after the date hereof.

 

3.23         Employees.

 

(a)           Schedule
3.23(a) sets forth a true, correct and complete list of the names, titles and office locations of all employees of Elite, the Company
and its Subsidiaries. Elite and the Company has delivered to the Buyer a true, correct and complete list of the names, titles,
annual salaries or wage rates and other compensation, vacation and fringe benefits, claims under benefit plans, resident alien
status (if applicable), and office location of all employees of Elite, the Company and its Subsidiaries and indicating part-time
and full-time employment. Neither Elite, the Company nor any of its Subsidiaries has promised any employee, consultant or agent
of ELITE, the Company and its Subsidiaries that he or she will continue to be employed by or render services to the Company or
any of its Subsidiaries or receive any particular benefits from Elite, the Company or any of its Subsidiaries or Buyer any of its
Affiliates on or after the Closing.

 

    	24

    	 

    

 

(b)           Except
as set forth on Schedule 3.23(b), neither Elite, the Company nor any of its Subsidiaries is a party to or subject to any employment
contract, consulting agreement, collective bargaining agreement, confidentiality agreement restricting the activities of Elite,
the Company or any of its Subsidiaries, non-competition agreement restricting the activities of Elite, the Company or any of their
Subsidiaries, or any similar agreement, and there has been no activity or proceeding by a labor union or representative thereof
to organize any employees of Elite, the Company or any of its Subsidiaries.

 

3.24         Employment
Matters.

 

(a)           Schedule
3.24(a) sets forth a true and complete list of every written, and a summary of every unwritten, employment agreement, commission
agreement, employee group or executive medical, life, or disability insurance plan, and each incentive, bonus, profit sharing,
retirement, deferred compensation, equity, phantom stock, stock option, stock purchase, stock appreciation right or severance plan
of the Company and any of its Subsidiaries now in effect or under which Elite, the Company or any of its Subsidiaries has or might
have any obligation, or any understanding between the Company or any of its Subsidiaries and any employee concerning the terms
of such employee’s employment that does not apply to the Company’s or its Subsidiaries’ employees generally (collectively,
“Labor Agreements”). The Company, and each of its Subsidiaries have previously delivered to Buyer true and complete
copies of each such Labor Agreement, any employee handbook or policy statement of the Company or any of its Subsidiaries, and complete
and correct information concerning Elite, the Company and its Subsidiaries’ employees, including with respect to the (i)
name, (ii) position; (iii) compensation; (iv) vacation and other fringe benefits; (v) claims under any benefit plan; and (vii)
resident alien status (if applicable). Schedule 3.24(a) sets forth a true and complete list of the names, addresses and titles
of the directors, officers and managers of each of the Company and its Subsidiaries.

 

(b)           Except
as disclosed on Schedule 3.24(b):

 

(i)          all
employees of Elite, the Company and its Subsidiaries are employees at will, and the employment of each employee by the Company
or any of its Subsidiaries may be terminated immediately by the Company or its Subsidiaries, as applicable, without any cost or
liability except severance in accordance with the Company and its Subsidiaries’ standard severance practice as disclosed
on Schedule 3.24(b);

 

(ii)         to
the knowledge of Elite and the Company, no employee of Elite, the Company or any of its Subsidiaries has any plan to terminate
his or her employment now or in the near future, whether as a result of the transactions contemplated hereby or otherwise;

 

(iii)        to
the knowledge of Elite and the Company, no employee of Elite, the Company or any of its Subsidiaries, in the ordinary course of
his or her duties, has breached any obligation to a former employer in respect of any covenant against competition or soliciting
clients or employees or servicing clients or confidentiality or any proprietary right of such former employer; and

 

    	25

    	 

    

  

(iv)        neither
Elite, the Company nor any of its Subsidiaries is a party to any collective bargaining agreement, nor has there been: (i) any labor
union organizing or attempting to organize any employee of the Company or any of its Subsidiaries into one or more collective bargaining
units; and (ii) any labor dispute, strike, work slowdown, work stoppage or lock out or other collective labor action by or with
respect to any employees of Elite, the Company or any of its Subsidiaries pending or, to the Company’s knowledge, threatened
against the Company or any its Subsidiaries.

 

(c)           Each
of Elite, the Company and its Subsidiaries has complied in all material respects with all Labor Agreements and all applicable laws
relating to employment or labor. Except as disclosed on Schedule 3.24(c), no present or former employee, officer, director or manager
of Elite, the Company or any of its Subsidiaries has, or will have at the Closing Date, any claim against the Company or any of
its Subsidiaries for any matter including for wages, salary, or vacation or sick pay, or otherwise under any Labor Agreement. All
accrued obligations of the Company and its Subsidiaries applicable to its employees, whether arising by operation of Law, by Contract,
by past custom or otherwise, for payments by the Company or any of its Subsidiaries to any trust or other fund or to any Authority,
with respect to unemployment or disability compensation benefits, or otherwise, have been paid or adequate accruals therefor have
been made.

 

3.25         Withholding.
 All accrued obligations of Elite, the Company and its Subsidiaries applicable to its employees, whether arising by operation of
Law, by contract, by past custom or otherwise, for payments by Elite, the Company or any of its Subsidiaries to trusts or other
funds or to any governmental agency, with respect to unemployment compensation benefits, social security benefits or any other
benefits for its employees with respect to the employment of said employees through the date hereof have been paid or adequate
accruals therefor have been made on the balance sheet. All reasonably anticipated obligations of Elite, the Company and its Subsidiaries
with respect to such employees (except for those related to wages during the pay period immediately prior to the Closing Date and
arising in the ordinary course of business), whether arising by operation of Law, by contract, by past custom, or otherwise, for
salaries and holiday pay, bonuses and other forms of compensation payable to such employees in respect of the services rendered
by any of them prior to the date hereof have been or will be paid by the Company and its Subsidiaries prior to the Closing Date.

 

3.26         Employee
Benefits and Compensation.

 

(a)           Schedule
3.26(a) sets forth a true and complete list of all bonus, deferred compensation, equity-based or non-equity-based incentive, severance
or other plan or written agreement relating to employee or director benefits or employee or director compensation or fringe benefits,
maintained or contributed to by Elite, the Company or any of its Subsidiaries on the date hereof (each a “Plan” and
collectively, the “Plans”). Each Plan is and has been maintained in substantial compliance with all applicable laws,
including but not limited to ERISA, and has been administered and operated in all material respects in accordance with its terms.

 

(b)           Except
as set forth on Schedule 3.26(b), no individual will accrue or receive additional benefits, service or accelerated rights to payment
of benefits as a direct result of the transaction contemplated by this Agreement. Except as set forth on Schedule 3.26(b), no material
liability, claim, investigation, audit, action or litigation has been incurred, made, commenced or, to the knowledge of Elite and
the Company, threatened, by or against any Plan, Elite, the Company or any of its Subsidiaries with respect to any Plan (other
than for benefits payable in the ordinary course).

 

    	26

    	 

    

 

 

(c)           Except
as set forth on Schedule 3.26(c), there is no unfunded non-tax-qualified Plan which provides a pension or retirement benefit.

 

(d)           Neither
Elite, the Company nor any of its Subsidiaries has made any commitment to create or cause to exist any employee benefit plan which
is not listed on Schedule 3.26, or to modify, change or terminate any Plan (other than as may be necessary for compliance with
applicable law).

 

3.27         Real
Property.

 

(a)           Elite,
the Company and each of its Subsidiaries have good and valid (and, in the case of owned Real Property, good and marketable fee
simple, or comparable right) title to, or a valid leasehold interest in, all Real Property and personal property and other assets
reflected on Schedule 3.27(a). All such properties and assets (including leasehold interests) are free and clear of Liens except
for the following (collectively referred to as “Permitted Liens”):

 

(i)          those
items set forth on Schedule 3.27(a);

 

(ii)         liens
for Taxes not yet due and payable or being contested in good faith by appropriate procedures and for which there are adequate accruals
or reserves on the Company’s most recent balance sheet;

 

(iii)        mechanics,
carriers’, workmen’s, repairmen’s or other like liens arising or incurred in the ordinary course of business
consistent with past practice or amounts that are not delinquent and which are not, individually or in the aggregate, material
to the business of the Company and each of its Subsidiaries;

 

(iv)        easements,
covenants, conditions, restrictions, rights of way, zoning ordinances, building codes, and other similar encumbrances affecting
Real Property which are not, individually or in the aggregate, material to the business of the Company and each of its Subsidiaries;

 

(v)         matters
that would be disclosed on an accurate survey of the Real Property that do not materially impair the use or occupancy of such Real
Property in the operation of the Business as currently conducted thereon; or

 

(vi)        other
than with respect to owned Real Property, liens arising under original purchase price conditional sales contracts and equipment
leases with third parties entered into in the ordinary course of business consistent with past practice which are not, individually
or in the aggregate, material to the business of the Company and each of its Subsidiaries.

 

    	27

    	 

    

  

(b)          Schedule
3.27(b) lists: (i) the street address of each parcel of Real Property; (ii) if such property is leased or subleased by Elite, the
Company or any of its Subsidiaries, the landlord under the lease, the rental amount currently being paid, and the expiration of
the term of such lease or sublease for each leased or subleased property; and (iii) the current use of such property.

 

(c)          With
respect to owned Real Property, Elite, the Company and each of its Subsidiaries has delivered or made available to Buyer true,
complete and correct copies of the deeds and other comparable instruments (as duly recorded in the appropriate cadastral offices
and land registries) by which the Company and each of its Subsidiaries acquired such Real Property, and copies of all title insurance
policies, opinions, abstracts and surveys in the possession of the Company and each of its Subsidiaries, relating to the Real Property.

 

3.28         Accounts.
Schedule 3.28 sets forth a true, complete and correct list of the checking accounts, deposit accounts, safe deposit boxes, and
brokerage, commodity and similar accounts of Elite, the Company and any of its Subsidiaries, including the account number and name,
the name of each depositary or financial institution and the address where such account is located and the authorized signatories
thereto.

 

3.29         Tax
Matters.  Except as set forth on Schedule 3.29:

 

(a)           (i)
Elite, the Company and each of its Subsidiaries has duly and timely filed all Tax Returns which are required to be filed by or
with respect to it in accordance with applicable Law, and has paid all Taxes owed by it (whether or not shown as due and payable
on any Tax Return) or has taken an adequate reserve for any Taxes not yet due and payable; (ii) all such Tax Returns are true,
correct and complete in all material respects; (iii) there is no Action pending or, to the knowledge of the Company threatened,
with respect to Taxes of the Company or any of its Subsidiaries; (iv) neither the Company nor any of its Subsidiaries is the beneficiary
of any waiver or extension of any statute of limitations in respect of the assessment or collection of any Taxes, which waiver
or extension is in effect; (v) the Company and each of its Subsidiaries has complied with all applicable Laws relating to the reporting,
payment, collection and withholding of Taxes and have duly and timely withheld or collected, paid over to the applicable Taxing
Authority and reported all Taxes (including income, social, security and other payroll Taxes) required to be withheld or collected
by the Company or any of its Subsidiaries; ( (viii) there is no Lien for Taxes upon any of the assets of the Company or any of
its Subsidiaries, other than Permitted Liens; (ix) there is no outstanding request for a ruling from any Taxing Authority, request
for a consent by a Taxing Authority for a change in a method of accounting, subpoena or request for information by any Taxing Authority
with respect to the Company or any of its Subsidiaries; (x) to the knowledge of the Company, no claim has ever been made by a Taxing
Authority in a jurisdiction where the Company or any of its Subsidiaries has not paid any Tax or filed Tax Returns, asserting that
the Company or any of its Subsidiaries is or may be subject to Tax in such jurisdiction; (xi) the Company and any of its Subsidiaries
has provided to Buyer true, complete and correct copies of all Tax Returns relating to, and all audit reports and correspondence
relating to each proposed adjustment, if any, made by any Taxing Authority with respect to, any taxable period ending after December
31, 2011; (xii) there is no outstanding power of attorney from the Company or any of its Subsidiaries authorizing anyone to act
on behalf of the Company or any of its Subsidiaries in connection with any Tax, Tax Return or Action relating to any Tax or Tax
Return of the Company or any of its Subsidiaries; (xiii) none of the Company or any of its Subsidiaries is, or has ever been, a
party to any Tax sharing or Tax allocation Contract; (xiv) neither the Company nor any of its Subsidiaries is, or has ever been,
included in any consolidated, combined or unitary Tax Return; (xv) none of the Company or any of its Subsidiaries has requested
any extension of time within which to file any Tax Return, which Tax Return has not been filed.

 

    	28

    	 

    

 

3.30         Environmental
Laws.  Except as set forth on Schedule 3.30, each of the Company and its Subsidiaries has complied in all material respects
with all Laws relating to pollution or the protection of the environment or human health or Hazardous Materials (“Environmental
Laws”), and there is not and there has not been at any time any written notice, demand, request for information, complaint,
order, investigation, or review pending or, to the knowledge of Elite and the Company, threatened by any Authority with respect
to any alleged violation by the Company or any of its Subsidiaries of any Environmental Law. None of the Company or any of its
Subsidiaries has been requested by any Authority to pay any sum of money, or otherwise aid or take any action or refrain from taking
actions, to abate or remediate any environmental occurrence or condition (including removal of asbestos or any other potentially
hazardous substance). Except as set forth on Schedule 3.30 any Real Property owned by the Company or any of its Subsidiaries, or
any of their Affiliates, is in compliance in all material respects with all Environmental Laws and no environmental site assessments
for any such Real Property have identified any violations of any Environmental Laws in connection therewith.

 

3.31         Finders’
Fees. Upon successful Closing, the Buyer will issue 337,059 shares of the common stock to Chardan Capital Markets as M&A Advisory
Compensation. 

 

Certain Business
Practices. Neither Elite, the Company, nor any of its Subsidiaries, nor any director or officer of Elite, the Company or any
of its Subsidiaries (in their capacities as such), nor to the knowledge of the Company, any agent or employee of Elite, the Company
or any of its Subsidiaries (in their capacities as such) has (i) used any funds for unlawful contributions, gifts, entertainment
or other unlawful expenses relating to political activity, (ii) made any unlawful payment to foreign or domestic government officials
or employees, to foreign or domestic political parties or campaigns or violated any provision of the Foreign Corrupt Practices
Act of 1977 or (iii) made any other unlawful payment. Neither the Company, nor any of its Subsidiaries, nor any director, officer,
agent or employee of the Company or any of its Subsidiaries (nor any Person acting on behalf of any of the foregoing, but solely
in his or her capacity as a director, officer, employee or agent of the Company, or any of their Subsidiaries) has, since June
30, 2014, directly or indirectly, given or agreed to give any gift or similar benefit in any material amount to any customer, supplier,
governmental employee or other Person who is or may be in a position to help or hinder Elite, the Company, or any of its Subsidiaries
or assist Elite, the Company, or any of its Subsidiaries in connection with any actual or proposed transaction, which, if not given
could reasonably be expected to have had an adverse effect on Elite, the Company, or any of their Subsidiaries, or which, if not
continued in the future, could reasonably be expected to adversely affect the business or prospects of Elite, the Company, or any
of its Subsidiaries that could reasonably be expected to subject Elite, the Company, or any of its Subsidiaries to suit or penalty
in any private or governmental litigation or proceeding.

 

3.33         Money
Laundering Laws. The operations of Elite, the Company, and each of its Subsidiaries are and have been conducted at all times
in compliance with laundering statutes in all applicable jurisdictions, the rules and regulations thereunder and any related or
similar rules, regulations or guidelines, issued, administered or enforced by any governmental authority (collectively, the “Money
Laundering Laws”), and no Action involving Elite, the Company, or any of its Subsidiaries with respect to the Money Laundering
Laws is pending or, to the knowledge of the Company, threatened.

 

    	29

    	 

    

  

3.34         OFAC.
None of Elite, the Company, nor any of their Subsidiaries, or any director or officer of Elite or the Company, or, to the knowledge
of the Company, any agent, employee, affiliate or Person acting on behalf of Elite, the Company, or any of its Subsidiaries is
currently identified on the specially designated nationals or other blocked person list or otherwise currently subject to any U.S.
sanctions administered by the Office of Foreign Assets Control of the U.S. Treasury Department (“OFAC”); and
the Company and any of its Subsidiaries has not, directly or indirectly, used any funds, or loaned, contributed or otherwise made
available such funds to any Subsidiary, joint venture partner or other Person, in connection with any sales or operations in any
country sanctioned by OFAC or for the purpose of financing the activities of any Person currently subject to, or otherwise in violation
of, any U.S. sanctions administered by OFAC in the last five (5) fiscal years.

 

3.35         No
Other Representations or Warranties. NONE OF ELITE, THE COMPANY OR ITS REPRESENTATIVES HAVE MADE ANY REPRESENTATIONS OR WARRANTIES,
EXPRESS OR IMPLIED, OF ANY NATURE WHATSOEVER RELATING TO THE COMPANY OR THE BUSINESS OR OTHERWISE IN CONNECTION WITH THE TRANSACTIONS
CONTEMPLATED HEREBY, OTHER THAN THOSE REPRESENTATIONS AND WARRANTIES EXPRESSLY SET FORTH IN THIS ARTICLE III.

 

ARTICLE IV

REPRESENTATIONS AND WARRANTIES OF THE BVI SHAREHOLDERS

 

Except as set forth in
the corresponding section of the disclosure schedules to be delivered to the Buyer prior to the Closing Date (with the disclosures
in any section or subsection of the disclosure schedules qualifying the other sections and subsections in this ARTICLE IV only
to the extent it is readily apparent from a reading of the disclosure that such disclosure is applicable to such other sections
and subsections), each of the Elite Shareholders hereby severally (and not jointly) hereby represents and warrants to Buyer that
each of the following representations and warranties is true, correct and complete as of the date of this Agreement and as of the
Closing Date:

 

4.1           Good
Title. The Shareholder is the record and beneficial owner, and has good title to its Equity Interests, with the right and authority
to sell and deliver such Equity Interests. Upon delivery of any certificate or certificates duly assigned, representing the same
as herein contemplated and/or upon registering of the Buyer as the new owner of such Equity Interests, Buyer will receive good
title to such Organic Region Stock, free and clear of all Liens.

 

4.2           Power
and Authority. The Shareholder has the legal power, capacity and authority to execute and deliver this Agreement and each Additional
Document to be delivered by it hereunder and to perform its obligations hereunder and thereunder, and to consummate the transactions
contemplated hereby or thereby. All acts required to be taken by the Shareholder to enter into this Agreement, to deliver any document
to which it is a party and to carry out the transactions contemplated hereby have been properly taken. This Agreement constitutes
a legal, valid and binding obligation of the Shareholder, enforceable against such Shareholder in accordance with the terms hereof.

 

    	30

    	 

    

  

4.3           No
Conflicts. The execution and delivery of this Agreement by the Shareholder and the performance by such Shareholder of its obligations
hereunder in accordance with the terms hereof: (a) will not require the consent of any third party or Governmental Entity under
any Laws; (b) will not violate any Laws applicable to the Shareholder and (c) will not violate or breach any contractual obligation
to which such Shareholder is a party.

 

4.1           Litigation.
There is no pending proceeding against the Shareholder that involves the Shares or that challenges, or may have the effect of preventing,
delaying or making illegal, or otherwise interfering with, any of the transactions contemplated by this Agreement and, to the knowledge
of the Shareholder, no such proceeding has been threatened, and no event or circumstance exists that is reasonably likely to give
rise to or serve as a basis for the commencement of any such proceeding.

 

4.2           No
Finder’s Fee. The Shareholder has not created any obligation for any finder’s, investment banker’s or broker’s
fee in connection with the transactions contemplated hereby.

 

4.3           Investor
Status. The Shareholder is either (i) an “accredited investor” as such term is defined under the rules and regulations
promulgated under the Securities Act, or (ii) is not a “U.S. Person” as such term is defined in Regulation S promulgated
under the Securities Act.

 

4.4           Purchase
Entirely for Own Account. The Buyer Common Stock proposed to be acquired by the Shareholder hereunder will be acquired for
investment for its own account, and not with a view to the resale or distribution of any part thereof, and such Shareholder has
no present intention of selling or otherwise distributing the Buyer Common Stock, except in compliance with applicable securities
laws.

 

4.5           Available
Information. The Shareholder has such knowledge and experience in financial and business matters that it is capable of evaluating
the merits and risks of investment in the Buyer and has had full access to all the information it considers necessary or appropriate
to make an informed investment decision with respect to the Buyer Common Stock.

 

4.6           Non-Registration.
The Shareholder understands that the Buyer Common Stock has not been registered under the Securities Act and, if issued in accordance
with the provisions of this Agreement, will be issued by reason of a specific exemption from the registration provisions of the
Securities Act which depends upon, among other things, the bona fide nature of the investment intent and the accuracy of the Shareholder’s
representations as expressed herein. The non-registration shall have no prejudice with respect to any rights, interests, benefits
and entitlements attached to the Buyer Common Stock in accordance with Buyer’s formation documents or the laws of its jurisdiction
of incorporation.

 

    	31

    	 

    

 

ARTICLE V

REPRESENTATIONS AND WARRANTIES OF BUYER

 

Buyer hereby represents
and warrants to the Company and ELITE that each of the following representations and warranties is true, correct and complete as
of the date of this Agreement and as of the Closing Date, except as disclosed in the Buyer SEC Documents:

 

5.1         Corporate
Existence and Power. Buyer is a company duly organized, validly existing and in good standing under the laws of the British
Virgin Islands. Buyer has all power and authority, corporate and otherwise required to own and operate its properties and assets,
and to carry on its business as presently conducted and as proposed to be conducted. Buyer’s chief executive offices are
located at the address set forth in the Buyer SEC Documents. Buyer has not taken any action, adopted any plan, or made any agreement
or commitment in respect of any merger, consolidation, sale of all or substantially all of its assets, reorganization, recapitalization,
dissolution or liquidation.

 

5.2         Corporate
Authorization. The execution, delivery and performance by Buyer of this Agreement and the Additional Agreements to which it
is a named party and the consummation by Buyer of the transactions contemplated hereby and thereby are within the corporate powers
of Buyer and have been duly authorized by all necessary corporate action on the part of Buyer. This Agreement has been duly executed
and delivered by Buyer and it constitutes, and upon their execution and delivery, each of the Additional Agreements to which it
is a named party will constitute, a valid and legally binding agreement of Buyer, enforceable against it in accordance with its
terms, except to the extent that enforceability thereof may be limited by applicable bankruptcy, insolvency, reorganization and
moratorium laws and other laws of general application affecting the enforcement of creditors’ rights generally, and the fact
that equitable remedies or relief (including, but not limited to, the remedy of specific performance) are subject to the discretion
of the court from which such relief may be sought. All corporate action on the part of the Buyer, its directors and stockholders
necessary for the (a) authorization execution, delivery and performance of this Agreement and the Additional Documents by the Buyer;
and (b) authorization, sale, issuance and delivery of the Buyer Common Stock contemplated hereby and the performance of the Buyer’s
obligations under this Agreement and the Additional Documents has been taken.

 

5.3         Governmental
Authorization. Neither the execution, delivery nor performance by Buyer of this Agreement requires any consent, approval, license
or other action by or in respect of, or registration, declaration or filing with, any Authority except for any filings required
to be made in connection with any registration rights agreement.

 

5.4         Non-Contravention.
Provided that eighty-seven and one-half percent 87.5% or fewer of the Buyer’s public stockholders exercise their redemption
rights with respect to such transaction (as specified in the Buyer Organizational Documents), the execution, delivery and performance
by Buyer of this Agreement do not and will not (a), contravene or conflict with the organizational or constitutive documents of
Buyer, (b) contravene or conflict with or constitute a violation of any provision of any Law, judgment, injunction, order, writ,
or decree binding upon Buyer, (c) constitute a default under or breach of (with or without the giving of notice or the passage
of time or both) or violate or give rise to any right of termination, cancellation, amendment or acceleration of any right or obligation
of Buyer or require any payment or reimbursement or to a loss of any material benefit relating to Buyer’s business to which
Buyer is entitled under any provision of any Permit, Contract or other instrument or obligations binding upon Buyer or by which
any of the shares of Buyer Common Stock or any of Buyer’s assets is or may be bound or any Permit, or (d) result in the creation
or imposition of any Lien on any of the shares of Buyer Common Stock or any of Buyer’s assets.

 

    	32

    	 

    

  

5.5         Finders’
Fees. Upon successful Closing, the Buyer will issue 337,059 shares of the Buyer Common Stock to Chardan Capital Markets as
M&A Advisory Compensation.

 

5.6         Issuance
of Equity Interests. The Buyer Common Stock constituting the Purchase Price and the Earnout Payment Equity Interests, when
issued in accordance with this Agreement, will be duly authorized and validly issued, and will be fully paid and nonassessable.

 

5.7         Capitalization.
The authorized capital stock of Buyer consists of 75,000,000 shares of Buyer Common Stock and 5,000,000 shares of preferred stock,
par value $0.001 per share, of which 5,136,000 shares of Buyer Common Stock are issued and outstanding as of the date hereof and
no shares of preferred stock are issued and outstanding. No shares of capital stock or other voting securities of Buyer are issued,
reserved for issuance or outstanding. All outstanding shares of Buyer Common Stock are duly authorized, validly issued, fully paid
and nonassessable and not subject to or issued in violation of any purchase option, right of first refusal, preemptive right, subscription
right or any similar right under any provision of British Virgin Islands law, the Buyer Organizational Documents or any contract
to which Buyer is a party or by which Buyer is bound. Except as set forth in the Buyer Organizational Documents, Buyer SEC Documents,
there are no outstanding contractual obligations of Buyer to repurchase, redeem or otherwise acquire any shares of Buyer Common
Stock or any capital equity of Buyer. There are no outstanding contractual obligations of Buyer to provide funds to, or make any
investment (in the form of a loan, capital contribution or otherwise) in, Buyer or any other Person. Except as set forth in the
Buyer SEC Documents, there are no outstanding options, warrants, rights (including conversion or preemptive rights) or agreements
for the purchase or acquisition from Buyer of any shares of its capital stock or any securities convertible into or ultimately
exchangeable or exercisable for any shares of Buyer’s capital stock.

 

5.8         Information
Supplied. None of the information supplied or to be supplied by Buyer expressly for inclusion or incorporation by reference
in the filings with the SEC and mailings to Buyer’s stockholders will, at the date of filing and/ or mailing, as the case
may be, contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary
in order to make the statements therein, in light of the circumstances under which they are made, not misleading (subject to the
qualifications and limitations set forth in the materials provided by Buyer or that are included in the Buyer SEC Documents). Upon
consummation of the transactions contemplated by this Agreement, upon notice thereof to the Trustee and disbursement from the Trust
Fund by the Trustee, the Trust Fund will terminate and the Trustee shall thereupon be obligated to release as promptly as practicable
to Buyer the monies then held in the Trust Fund, which such funds will be free of any Liens whatsoever, and will be available for
use in the businesses of Buyer and the Company. As of the Closing Date, those obligations of Buyer to dissolve or liquidate within
a specified time period as contained in its Amended and Restated Memorandum of Association and its Amended and Restated Articles
of Association (collectively, the “Buyer Organizational Documents”) will terminate, and effective as of the
Closing Date Buyer shall have no obligation whatsoever to dissolve and liquidate the assets of Buyer by reason of the consummation
of the transactions contemplated by this Agreement.

 

    	33

    	 

    

  

5.9         Trust
Fund. As of the date of this Agreement (and immediately prior to the Closing Date), Buyer has (and will have immediately prior
to the Closing Date) at least $41,600,000 (the “Minimum Trust Amount”) in the trust fund established by Buyer
for the benefit of its public stockholders (the “Trust Fund”) in a trust account at JP Morgan (the “Trust
Account”), such monies invested in government securities (as such term is defined in the Investment Company Act of 1940,
as amended), and held in trust by American Stock Transfer & Trust Company (the “Trustee”) pursuant to the
Investment Management Trust Agreement, dated as of December 18, 2012, between Buyer and Trustee (the “Trust Agreement”).

 

5.10        Board
Approval. The Buyer’s board of directors (including any required committee or subgroup of such board) has, as of the
date of this Agreement, unanimously (i) declared the advisability of the transactions contemplated by this Agreement, (ii) determined
that the transactions contemplated hereby are in the best interests of the stockholders of Buyer, and (iii) determined that the
transactions contemplated hereby constitute a “Business Transaction” as such term is defined in the Buyer Organizational
Documents. Assuming no more than eighty-seven and one-half percent (87.5%) of the “IPO Equity Interests” as defined
in the Buyer’s Amended and Restated Memorandum and Article of Association, can receive their pro-rata portion of the trust
account, no other action on the part of Buyer’s stockholders is required to consummate the transactions contemplated hereby
and upon consummation thereof, Article 131 of Buyer’s Amended and Restated Articles of Association, as amended, shall no
longer be applicable.

 

5.11        Buyer
SEC Documents and Buyer Financial Statements. Buyer has made available to the Company copies in the form filed with the SEC
of all of the following, except to the extent available in full without redaction on the SEC’s website through EDGAR for
at least twenty (20) days prior to the date of this Agreement: (i) Buyer’s Annual Reports on Form 20-F for each fiscal year
of Buyer beginning with the first year Buyer was required to file such a form, (ii) all proxy statements relating to Buyer’s
meetings of stockholders (whether annual or special) held, and all information statements relating to stockholder consents, since
the beginning of the first fiscal year referred to in clause (i) above, (iii) its Reports of Foreign Private Issuer on Form 6-K
filed since the beginning of the first fiscal year referred to in clause (i) above, and (iv) all other forms, reports, registration
statements and other documents (other than preliminary materials if the corresponding definitive materials have been provided to
the Company pursuant to this Section 5.11) filed by Buyer with the SEC since Buyer’s formation (the forms, reports, registration
statements and other documents referred to in clauses (i), (ii), (iii), and (iv) above, whether or not available through EDGAR,
are, collectively, the “Buyer SEC Documents”). The Buyer SEC Documents were prepared in all material respects in accordance
with the requirements of the Securities Act, the Exchange Act, and the Sarbanes-Oxley Act, as the case may be, and the rules and
regulations thereunder. The Buyer SEC Documents did not at the time they were filed with the SEC (except to the extent that information
contained in any Buyer SEC Document has been revised or superseded by a Buyer SEC Document filed at least two (2) days prior to
the date of this Agreement, then on the date of such filing) contain any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary in order to make the statements made therein, in the light of the circumstances
under which they were made, not misleading. As used in this Section 5.11, the term “file” shall be broadly construed
to include any manner in which a document or information is furnished, supplied or otherwise made available to the SEC.

 

    	34

    	 

    

  

(a)         The
financial statements and notes contained or incorporated by reference in the Buyer SEC Documents (“Buyer Financials”)
fairly present the financial condition and the results of operations, changes in stockholders’ equity, and cash flow of Buyer
as at the respective dates of and for the periods referred to in such financial statements, all in accordance with (i) IFRS and
(ii) Regulation S-X or Regulation S-K, as applicable, subject, in the case of interim financial statements, to normal recurring
year-end adjustments (the effect of which will not, individually or in the aggregate, be materially adverse) and the omission of
notes to the extent permitted by Regulation S-X or Regulation S-K, as applicable. Buyer has no off-balance sheet arrangements.

 

(b)         Neither
Buyer, nor any manager, director, officer or employee of Buyer, has received any complaint, allegation, assertion or claim, whether
or not in writing, regarding the accounting or auditing practices, procedures, methodologies or methods of Buyer or its internal
accounting controls, including any complaint, allegation, assertion or claim that Buyer has engaged in questionable accounting
or auditing practices. No attorney representing Buyer, whether or not employed by Buyer, has reported evidence of any violation
of consumer protection, insurance or securities Laws, breach of fiduciary duty or similar violation by Buyer or any of its officers,
directors, employees or agents to the Board of Directors of Buyer or any committee thereof.

 

(c)         Except
as and to the extent reflected or reserved against in the Buyer Financials or as listed on Schedule 5.11, Buyer has not incurred
any liabilities or obligations of the type required to be reflected on a balance sheet in accordance with IFRS that is not adequately
reflected or reserved on or provided for in the Buyer Financials, other than liabilities of the type required to be reflected on
a balance sheet in accordance with IFRS that have been incurred since June 30, 2014 in the ordinary course of business and are
described on Schedule 5.11(c).

 

5.12        Absence
of Certain Changes. Except as set forth as set forth in Buyer SEC Documents, Buyer has conducted its business in the ordinary
course consistent with past practices, and there has not been:

 

(a)         any
transaction, Contract or other instrument entered into, or commitment made, by Buyer other than transactions and commitments in
the ordinary course of business consistent with past practices and those contemplated by this Agreement;

 

(b)         any
creation or other incurrence of any Lien on any Buyer Common Stock or any of Buyer’s assets;

 

(c)         the
redemption of, declaration or payment of any dividend or other distribution with respect to, the equity interests of Buyer (except
as contemplated under the Buyer’s organizational documents); or

 

(d)         except
as set forth in Schedule 5.12, any loan or other Indebtedness obtained or incurred by Buyer.

 

    	35

    	 

    

  

5.13        Tax
Matters. Except as set forth in the Buyer SEC Documents, (a) Buyer has duly and timely filed all Tax Returns which are required
to be filed by or with respect to it in accordance with applicable Law, and has paid all Taxes owed by it (whether or not shown
as due and payable on any Tax Return) or has taken an adequate reserve in accordance with IFRS for any Taxes not yet due and payable;
(b) all such Tax Returns are true, correct and complete in all material respects; (c) there is no Action pending or, to the knowledge
of Buyer threatened, with respect to Taxes of Buyer; (d) Buyer is not the beneficiary of any waiver or extension of any statute
of limitations in respect of the assessment or collection of any Taxes, which waiver or extension is in effect; (e) Buyer has complied
with all applicable Laws relating to the reporting, payment, collection and withholding of Taxes and have duly and timely withheld
or collected, paid over to the applicable Taxing Authority and reported all Taxes (including income, social, security and other
payroll Taxes) required to be withheld or collected by the Buyer; (f) there is no Lien for Taxes upon any of the assets of the
Buyer, other than Permitted Liens; (g) there is no outstanding request for a ruling from any Taxing Authority, request for a consent
by a Taxing Authority for a change in a method of accounting, subpoena or request for information by any Taxing Authority, closing
agreement (within the meaning of Section 7121 of the Code or any analogous provision of applicable Law), with respect to Buyer;
(h) to the knowledge of the Buyer, no claim has ever been made by a Taxing Authority in a jurisdiction where Buyer has not paid
any Tax or filed Tax Returns, asserting that Buyer is or may be subject to Tax in such jurisdiction; (i) Buyer has provided to
the Company true, complete and correct copies of all Tax Returns relating to, and all audit reports and correspondence relating
to each proposed adjustment, if any, made by any Taxing Authority with respect to, any taxable period ending after December 31,
2011; (j) there is no outstanding power of attorney from Buyer authorizing anyone to act on behalf of Buyer in connection with
any Tax, Tax Return or Action relating to any Tax or Tax Return of Buyer; (k) Buyer is not, nor has ever been, a party to any Tax
sharing or Tax allocation Contract; (l) Buyer is not, nor has ever been, included in any consolidated, combined or unitary Tax
Return; and (m) Buyer has not requested any extension of time within which to file any Tax Return, which Tax Return has not been
filed.

 

5.14        Employee
Benefit Plans. Buyer does not maintain, and has no liability under, any Plan, and neither the execution and delivery of this
Agreement nor the consummation of the transactions contemplated hereby will (i) result in any payment (including severance, unemployment
compensation, golden parachute, bonus or otherwise) becoming due to any director or employee of Buyer, or (ii) result in the acceleration
of the time of payment or vesting of any such benefits.

 

5.15        Employee
Matters. Buyer has never had any current or former employees.

 

5.16        Material
Contracts.

 

(a)         Except
as set forth in the Buyer SEC Documents filed prior to the date hereof, there are no Contracts, agreements, leases, mortgages,
indentures, notes, bonds, liens, license, permit, franchise, purchase orders, sales orders or other understandings, commitments
or obligations (including without limitation outstanding offers or proposals) of any kind, whether written or oral, to which Buyer
is a party or by or to which any of the properties or assets of Buyer may be bound, subject or affected, which either (i) creates
or imposes a liability greater than $50,000, or (ii) may not be cancelled by Buyer on less than 60 days’ or less prior notice.
Buyer has given to the Company, or has otherwise directed the Company to the exhibits to the Buyer SEC Documents containing, true
and correct (A) fully executed copies of each written Contract and (B) written summaries of each oral Contract.

 

    	36

    	 

    

  

(b)         With
respect to each Contract referenced in Section 5.16(a), each such Contract is a valid and binding agreement of Buyer, and is in
full force and effect, and neither Buyer nor, to the knowledge of Buyer, any other party thereto, is in breach or default (whether
with or without the passage of time or the giving of notice or both) under the terms of any such Contract. Buyer has not assigned,
delegated, or otherwise transferred any of its rights or obligations with respect to any Contracts, or granted any power of attorney
with respect thereto or to any of Buyer’s assets.

 

5.17        Litigation.
There is no Action (or any basis therefor) pending against, or to the knowledge of Buyer, threatened against or affecting, Buyer,
any of its officers or directors (in their capacity as such), its business, or any shares of Buyer Common Stock or any of Buyer’s
assets, or which in any manner challenges or seeks to prevent, enjoin, alter or delay the transactions contemplated hereby or by
the Additional Agreements. There are no outstanding judgments against Buyer.

 

5.18        Transactions
with Affiliates. Other than as set forth in the Buyer SEC Documents, there are no contracts or arrangements that are in existence
as of the date of this Agreement under which there are any existing or future liabilities or obligations between Buyer and any
(i) director, officer, employee or affiliate of Buyer, or (ii) record or beneficial owner of more than 5% of the outstanding Buyer
Common Stock as of the date hereof.

 

5.19        Investment
Company Act. Buyer is not an “investment company” or a person directly or indirectly “controlled” by
or acting on behalf of an “investment company”, in each case within the meaning of the Investment Company Act of 1940,
as amended.

 

5.20        Disclosure
of Information. Buyer has had an opportunity to discuss with management of the Company and Elite such aspects of the Company’s
business, management, and financial affairs as Buyer has considered necessary and appropriate for its evaluation of the merits
and risks of the transactions contemplated by this Agreement. In addition, Buyer has had an opportunity to view the Company’s
properties and facilities to such extent as Buyer has considered necessary and appropriate for its evaluation of the merits and
risks of the transactions contemplated by this Agreement. Buyer acknowledges that (a) except for the matters that are expressly
covered by this Agreement, Buyer is relying on its own investigation and analysis in entering into this Agreement and consummating
the transactions contemplated hereby, and (b) it is sophisticated and has undertaken such investigation, and has been provided
with and has evaluated such documents and information, as it has deemed necessary in connection with the execution, delivery and
performance of this Agreement and (c) Buyer is acquiring the Equity Interests for its own account and not with a view to the distribution
thereof. Buyer acknowledges that the Equity Interests have not been registered under the Securities Act and that the Equity Interests
may not be resold absent such registration or unless an exemption therefrom is available. Buyer is an “accredited investor”
as such term is defined in Regulation D under the Securities Act and, by reason of its financial experience, is capable of evaluating
the information relating to the Company and the merits and risks of the investment in the Equity Interests.

 

    	37

    	 

    

  

5.21        Stock
Exchange Listing.  The shares of Buyer Common Stock are listed on The NASDAQ Capital Market (the “Exchange”),
and the Company has not received any notification that the Exchange is contemplating terminating such listing.  Promptly following
the execution of this Agreement, the Company will prepare and file an application for the Listing of Additional Shares with the
Exchange to list the Buyer Common Stock to be issued to the ELITE Shareholders in accordance with this Agreement.

 

5.22        Foreign
Private Issuer. The Company qualifies as a “foreign private issuer” as defined in Rule 405 under the Securities
Act. 

 

5.23        Registration
Rights of Third Parties.  Except as disclosed in the Buyer SEC Documents, no holders of any securities of the Buyer or
any rights exercisable for or convertible or exchangeable into securities of the Buyer have the right to require the Buyer to register
any such securities of the Company under the Securities Act of 1933, as amended or to include any such securities in a registration
statement to be filed by the Buyer.

 

ARTICLE VI

COVENANTS OF THE COMPANY AND 

ELITE PENDING CLOSING

 

The Company and Elite jointly and
severally covenant and agree that:

 

6.1         Conduct
of the Business. Except for the sale and/or issuance of any Elite Shares which shall be included and listed on Schedule I of
this Agreement, and other actions to be taken by the Company and/or Elite to effectuate the restructuring of debt owned by previously
existing private equity firms, from the date hereof through the Closing Date, Elite shall cause the Company to and the Company
shall, and shall cause any of its Subsidiaries to, conduct the Business in all material respects in the ordinary course, (including
the payment of accounts payable and the collection of accounts receivable), consistent with past practices, and shall not enter
into any material transactions without the prior written consent of Buyer, and shall use commercially reasonable efforts to preserve
intact its business relationships with employees, clients, suppliers and other third parties. Without limiting the generality of
the foregoing, from the date hereof until and including the Closing Date, without Buyer’s prior written consent, the Company
and Elite shall not, and shall cause the Company’s Subsidiaries to not:

 

(i)         amend,
modify or supplement its articles of incorporation or other comparable organizational or governing documents;

 

(ii)        amend,
waive any material provision of, terminate prior to its scheduled expiration date, or otherwise compromise in any way, any Material
Contract, or any other right or asset of the Company, and any of its Subsidiaries;

 

(iii)        enter
into a Contract which would be considered a Material Contract;

 

    	38

    	 

    

  

(iv)        make
any capital expenditures in excess of $300,000 (individually or in the aggregate);

 

(v)        sell,
lease, license or otherwise dispose of any of the Company’s, or any of its Subsidiaries’ assets, including without
limitation the Real Property, or assets covered by any Contract except (i) pursuant to existing contracts or commitments disclosed
herein, (ii) sales of obsolete assets or assets with de minimis or no book value and (iii) investment assets in the ordinary
course of Business;

 

(vi)        pay,
declare or promise to pay any dividends or other distributions with respect to its capital stock, or pay, declare or promise to
pay any other payments to any Affiliate of the Company or its Subsidiaries;

 

(vii)       except
in the ordinary course of business consistent with past practice, or as required under the terms of any Plan, authorize any salary
increase of more than 30% for any employee making an annual salary of greater than $100,000, or in excess of $100,000 in the aggregate
on an annual basis, or materially change the bonus or profit sharing policies of the Company or its Subsidiaries, other than as
set forth on Schedule 6.1(vii);

 

(viii)      obtain
or incur any loan or other Indebtedness (other than capital and surplus notes or trade payables incurred in the ordinary course
of business);

 

(ix)        use
commercially reasonable efforts to keep in force insurance policies or replacement or revised policies providing insurance coverage
with respect to the assets, operations and activities of the Company and its Subsidiaries in an amount and scope of coverage as
are currently in effect;

 

(x)         suffer
or incur any Lien (other than a Permitted Lien) on any of the Company’s or its Subsidiaries’ assets, including without
limitation the Real Property;

 

(xi)        except
in the ordinary course of business consistent with past practice, delay, accelerate or cancel any receivables or Indebtedness owed
to the Company or any of its Subsidiaries or write-off or make further reserves against the same, except as required by GAAP;

 

(xii)        merge
or consolidate with or acquire any other Person or be acquired by any other Person;

 

(xiii)       suffer
to lapse, terminate, cancel or amend any insurance coverage maintained with respect to any material property or which has not been
replaced by a comparable amount of insurance coverage;

 

(xiv)      except
to the extent required by Law, amend any of its Plans set forth in Section 3.27(a) or fail to continue to make timely contributions
thereto in accordance with the terms thereof;

 

    	39

    	 

    

  

(xv)       make
any change in its accounting principles or methods or write down the value of any assets, including without limitation the Real
Property, except insofar as may be required by a change in applicable Law or applicable accounting principles or as determined
by an independent auditor;

 

(xvi)      change
the place of business or jurisdiction of organization of the Company or any of its Subsidiaries;

 

(xvii)     extend
any loans other than travel or other expense advances to employees in the ordinary course of business not to exceed $10,000 individually
or $50,000 in the aggregate;

 

(xviii)    issue,
redeem or repurchase any Equity Interests, or issue any securities exchangeable for or convertible into Equity Interests unless
as part of a capital and surplus note agreement;

 

(xix)       reduce
the prices of products sold for customers except in the ordinary course of Business;

 

(xx)        effect
or agree to any material change in any practices or terms, including payment terms, with respect to customers or suppliers, except
as required by applicable Law or any Authority;

 

(xxi)       hire
any employees, consultants or advisors except in the ordinary course of business, extensions of current agreements or as otherwise
set forth on Schedule 6.1(xxi);

 

(xxii)      make
or change any material Tax election or change any annual Tax accounting periods;

 

(xxiii)     The
Company and its Subsidiaries shall not, and Elite shall cause the Company and its Subsidiaries not to, (i) take or agree to take
any action that might make any representation or warranty of the Company or its Subsidiaries, Elite hereunder inaccurate or misleading
in any respect at, or as of any time prior to, the Closing Date or (ii) omit to take, or agree to omit to take, any action necessary
to prevent any such representation or warranty from being inaccurate or misleading in any respect at any such time.

 

(xxiv)    undertake
any act with the actual knowledge and intent that the taking of such act would directly cause a representation or warranty of the
Company not to be true and correct as of the Closing Date, with such exceptions as would not in the aggregate reasonably be expected
to have a Material Adverse Effect; or

 

(xxv)     agree
to do any of the foregoing.

 

    	40

    	 

    

  

6.2         Notices
of Certain Events. The Company shall promptly notify Buyer of:

 

(a)         any
notice or other communication from any Person alleging that the consent of such Person is or may be required in connection with
the transactions contemplated by this Agreement or that the transactions contemplated by this Agreement might give rise to any
Action or other rights by or on behalf of such Person or result in the loss of any rights or privileges of the Company and each
of its Subsidiaries (or Buyer, post-Closing) to any such Person or create any Lien on any Equity Interests or any of the Company’s
and each of its Subsidiaries’ assets;

 

(b)         any
notice or other communication from any Authority in connection with the transactions contemplated by this Agreement or the Additional
Agreements;

 

(c)         any
Actions commenced or, to the knowledge of the Company, threatened against, relating to or involving or otherwise affecting Elite,
the Company and each of its Subsidiaries, the Equity Interests, any of the Company’s and each of its Subsidiaries’
assets, including without limitation the Real Property, or the Business or that relate to the consummation of the transactions
contemplated by this Agreement or the Additional Agreements;

 

(d)         the
occurrence of any fact or circumstance which constitutes or results, or could reasonably be expected to constitute or result in
a Material Adverse Effect; and

 

(e)         the
occurrence of any fact or circumstance which constitutes or results, or could reasonably be expected to constitute or result in
any representation made hereunder by the Company and/or Elite to be false or misleading in any material respect or to omit or fail
to state a material fact; provided, however, that should any notice pursuant to this
Section 6.2 require any amendment or supplement to the Company Disclosure Schedules, the Company may deliver to Buyer a supplement
or amendment to the Company Disclosure Schedules specifying such change; provided further, however,
that neither any such supplement or amendment to the Company Disclosure Schedules nor any notice pursuant to this Section 6.2 shall
limit the right of Buyer to claim a failure of a condition to the Closing set forth in Section 9.2, with respect to any matters
disclosed in such supplement, amendment or notice.

 

6.3         SEC
Filings.

 

(a)         The
Company, each of its Subsidiaries and Elite acknowledge that:

 

(i)         the
Buyer will be required to file Annual Reports on Form 20-F that may be required to contain information about the transactions contemplated
by this Agreement; and

 

(ii)        the
Buyer will be required to file Reports of Foreign Private Issuer on Form 6-K to announce the transactions contemplated hereby and
other significant events that may occur in connection with such transactions.

 

(b)         In
connection with any filing the Buyer makes with the SEC that requires information about the transactions contemplated by this Agreement
to be included, the Company, each of its Subsidiaries and Elite shall, in connection with the disclosure included in any such filing
or the responses provided to the SEC in connection with the SEC’s comments to a filing (i) cooperate with the Buyer, (ii)
respond to questions about the Company, each of its Subsidiaries or Elite required in any filing or requested by the SEC, and (iii)
provide any information requested by the Buyer or Buyer’s representatives in connection with any filing with the SEC.

 

    	41

    	 

    

  

6.4         Financial
Information. Elite, the Company and each of its Subsidiaries will provide additional financial information or financial statements
requested by the Buyer that are required to be included in any filings to be made by the Buyer with the SEC. If requested by the
Buyer and required by the SEC, such information or financial statements must be reviewed or audited by the Company’s auditors.

 

6.5         Employees
of the Company. Schedule 6.5 lists those employees of the Company or any of its Subsidiaries designated by the Company as key
personnel of the Company and its Subsidiaries..

 

6.6         [Intentionally
Left Blank].

 

6.7         Exclusivity.

 

From the date hereof
until the date that this Agreement is terminated pursuant to Article XII, neither the Company, nor any of its Subsidiaries, nor
Elite nor anyone acting on their behalf shall, directly or indirectly, (a) encourage, solicit, initiate or participate in discussions
or negotiations with any Person regarding any Acquisition Proposal, other than Buyer or its Affiliates (collectively “Buyer
Excluded Persons”), or an officer, partner, employee or other representative of a Buyer Excluded Person, (b) furnish
any non-public information regarding the Company or any of its Subsidiaries to any Person, other than Buyer Excluded Persons, in
connection with or in response to an Acquisition Proposal, (c) engage or participate in discussions or negotiations with any Person
that could reasonably be expected to lead to an Acquisition Proposal, or (c) consummate any Acquisition Proposal or accept
any offer or agree to engage in any Acquisition Proposal.

 

From the date hereof
until the date that this Agreement is terminated pursuant to Article XII, neither the Buyer, nor anyone acting on its behalf shall,
directly or indirectly, (a) encourage, solicit, initiate or participate in discussions or negotiations with any Person regarding
any acquisition by the Buyer of the assets or shares or other equity interests of a company or other entity that has or constitutes
an operating business or as may otherwise be considered an acquisition transaction in accordance with the Buyer’s Amended
and Restated Memorandum and Articles of Association (a “Business Combination Proposal”), other than Elite and its affiliates
(collectively “Elite Excluded Persons”), or an officer, partner, employee or other representative of a Elite
Excluded Person, (b) furnish any non-public information regarding the Buyer to any Person, other than Elite Excluded Persons, in
connection with or in response to an Business Combination Proposal, (c) engage or participate in discussions or negotiations with
any Person that could reasonably be expected to lead to a Business Combination Proposal, or (c) consummate any Business Combination
Proposal or accept any offer or agree to engage in any Business Combination Proposal.

 

    	42

    	 

    

  

6.8         Commercially
Reasonable Efforts to Obtain Consents. From the date hereof through the Closing Date, the Company shall use commercially reasonable
efforts to obtain each Company Consent as promptly as practicable hereafter. Notwithstanding anything herein to the contrary, the
Company shall not be required to agree to any term, condition or modification with respect to obtaining any Company Consent that
would result in, or would be reasonably likely to result in a Material Adverse Effect.

 

6.9         Annual
Financial Statements.

 

(a)         By
no later than September 15, 2014, the Company shall deliver to the Buyer the consolidated financial statements of the Company as
of and for the fiscal years ended June 30, 2012, 2013 and 2014, consisting of the audited consolidated balance sheets as of such
date, the audited consolidated income statements for the twelve (12) month periods ended on such dates, and the audited consolidated
cash flow statements for the twelve (12) month periods ended on such dates. Such financial statements shall be prepared in accordance
with GAAP and audited in accordance with PCAOB standards (the “Audited Financial Statements”).

 

6.10        Purchase
of Ordinary Shares. Elite or its affiliates shall purchase by no later thanthe Closing Date, 500,000 shares of the Buyer’s
Series A ordinary shares from public stockholders.

 

6.11        Outstanding
Debt. Elite will have (i) indebtedness for borrowed money not in excess of $85,000,000 as of the Closing Date (ii) no shareholder
indebtedness (iii) trade and other payables not in excess of $40,000,000, (iv) advances from customers not in excess of $2,000,000,
(v) tax and deferred tax liabilities not in excess of $2,500,000, (vi) dividend payable of $35,000,000 and (vii) not less than
$7,500,000 in unrestricted cash on the balance sheet post dividend.

 

ARTICLE VII

COVENANTS OF BUYER

 

7.1         Conduct
of the Business. From the date hereof through the Closing Date, the Buyer shall conduct its business in all material respects
in the ordinary course, consistent with past practices, and shall not enter into any material transactions without the prior written
consent of Company. Buyer shall conduct its business in compliance with applicable Laws in all material respect, including without
limitation the timely and accurate filing of all reports, forms or other documents with the SEC required to be filed with the SEC
by Parent pursuant to the Securities Act, the Exchange Act and the Sarbanes-Oxley Act, and to preserve intact the business organization
of Buyer. Without limiting the generality of the foregoing, from the date hereof until and including the Closing Date, without
Company’s prior written consent, the Buyer shall not:

 

(a)         amend,
modify or supplement its memorandum and articles of association or other comparable organizational or governing documents;

 

(b)         amend,
waive any material provision of, terminate prior to its scheduled expiration date, or otherwise compromise in any way, any material
Contract, or any other right or asset of the Buyer;

 

(c)         modify,
amend or enter into any material contract, deed, agreement, lease, license or commitment;

 

    	43

    	 

    

  

(d)         acquire,
lease or sublease any material tangible assets, raw material or properties (including real property), or make any capital expenditures;

 

(e)         sell,
lease, license or otherwise dispose of any of the Buyer’s assets except (i) pursuant to existing contracts or commitments
disclosed herein and (ii) sales of obsolete assets or assets with de minimis or no book value;

 

(f)         pay,
declare or promise to pay any dividends or other distributions with respect to Buyer Common Stock, or pay, declare or promise to
pay any other payments to any Affiliate of the Buyer;

 

(g)         obtain
or incur any loan or other Indebtedness;

 

(h)         suffer
or incur any Lien (other than a Permitted Lien) on any of the Buyer’s assets;

 

(i)         merge
or consolidate with or acquire any other Person or be acquired by any other Person;

 

(j)         establish
any subsidiary (other than as contemplated hereby) or enter into any new line of business;

 

(k)         acquire,
including by merger, consolidation, acquisition of stock or assets, or any other form of business combination, any corporation,
partnership, limited liability company, other business organization or any division thereof, or any material amount of assets;

 

(l)         make
any change in its accounting principles or methods or write down the value of any assets, except insofar as may be required by
a change in applicable Law or applicable accounting principles;

 

(m)         change
the place of business or jurisdiction of organization of the Buyer;

 

(n)         issue,
redeem or repurchase any Buyer Common Stock except in accordance with the Form 6-K, or issue any securities exchangeable for or
convertible into Buyer Common Stock;

 

(o)         make
or change any material Tax election or change any annual Tax accounting periods;

 

(p)         take
any action that would reasonably be expected to delay or impair the obtaining of any consents or approvals of any Authority to
be obtained in connection with this Agreement;

 

(q)         undertake
any act with the actual knowledge and intent that the taking of such act would directly cause a representation or warranty of the
Buyer not to be true and correct as of the Closing Date, with such exceptions as would not in the aggregate reasonably be expected
to have a Material Adverse Effect; or

 

    	44

    	 

    

  

(r)         agree
to do any of the foregoing.

 

7.2         Trust
Account. The Buyer shall make appropriate arrangements to cause the funds in the Trust Account to be disbursed in accordance
with the Trust Agreement such that (i) all amounts payable to stockholders of Buyer’s ordinary shares shall be paid upon
acceptance by the Buyer of such shares, (ii) the expenses to the third parties to which they are owed shall be paid, and (iii)
the remaining monies in the Trust Account shall be disbursed to Buyer.

 

7.3         Filings.
Except for those described in Section 8.9, before the Closing, Buyer shall make such notice and other filings and obtain any consents,
approvals, or authorizations required by federal, state and foreign securities laws for Buyer to consummate the transactions contemplated
by the Agreement and the Additional Agreements to which Buyer is named as a party.

 

7.4         Covenant
of CIS Sponsor. For a period of 13 months following the Closing, the CIS Sponsor shall not sell short, hedge against, lend
against, engage in day trading with respect to, or in any way manipulate, the securities of the Buyer, and shall not engage in
any similar activity which has the effect of lowering the trading price of the Buyer’s securities. Notwithstanding the provisions
of this section, the CIS Sponsor is not prohibited from buying or selling the Buyer’s securities.

 

ARTICLE VIII

COVENANTS OF ALL PARTIES HERETO

 

The parties hereto covenant
and agree that:

 

8.1         Confidentiality.

 

(a)         Except
as otherwise required by law, prior to and after the Closing, neither party shall, without the prior written consent of the other
party, or a person authorized thereby, disclose to any other Person or use (whether for the account of such party or any other
party) any confidential information or proprietary work product of the other party or any client of the other party. In the event
that a party believes that it is required to disclose any such confidential information pursuant to applicable Laws, such party
shall give timely written notice to the other party so that the other party may have an opportunity to obtain a protective order
or other appropriate relief. Each of the parties shall cooperate fully in any such action.

 

(b)         Except
as required by Law, any information (except publicly available or freely usable material obtained from another source) respecting
any party or its Affiliates will be kept in strict confidence by all other parties to this Agreement and their agents. Except as
required by Law, none of the parties, nor any of their respective Affiliates, directors, officers, employees or agents will disclose
the terms of the transactions contemplated hereunder or by any Additional Agreement at any time, currently, or on or after the
Closing, regardless of whether the Closing takes place, except as required by Law or as necessary to their attorneys, accountants
and professional advisors, in which instance such persons and any employees or agents shall be advised of the confidential nature
of the terms of the transaction and shall themselves be required to keep such information confidential. Except as required by Law,
each party shall retain all information obtained from the other and their legal counsel on a confidential basis except as necessary
to their attorneys, accountants and professional advisors, in which instance such persons and any employees or agents of such party
shall be advised of the confidential nature of the terms of the transaction and shall themselves be required by such party to keep
such information confidential.

 

    	45

    	 

    

  

8.2         Access
to Information. From the date hereof until and including the Closing Date, each party shall, (a) continue to give to the other
party, its legal counsel and other representatives full access to the offices, properties and, Books and Records during normal
business hours, (b) furnish to the other party, its legal counsel and other representatives such information relating to the Business
as such Persons may request and (c) upon reasonable notice, cause the employees, legal counsel, accountants and representatives
of such party to cooperate with the other party in its investigation of the Business; provided that in exercising its rights
under this Section 8.2, such party, its legal counsel and representatives shall not be permitted to interfere unreasonably with
the conduct of the business of the other party or any of its Subsidiaries; provided further, that no investigation
pursuant to this Section (or any investigation prior to the date hereof) shall affect any representation or warranty given by such
party.

 

8.3         Injunctive
Relief. If a party breaches, or threatens to commit a breach of, any of the respective covenants set forth in Sections 6.1(i),
6.1(vii), 6.1(xii), 6.1(xvi), 6.1(xviii), 7.1(a), 7.1(f), 7.1(i), 7.1(j), 7.1(k), 7.1(m), 7.1(n), 7.1(p), or 8.1 (the “Restrictive
Covenants”), the other party shall have in addition to, and not in lieu of, any other rights and remedies available to
such party by agreement (including those set forth in Section 11.1 hereof), under law or in equity, the right and remedy to have
the Restrictive Covenants specifically enforced by any court having equity jurisdiction, all without the need to post a bond or
any other security or to prove any amount of actual damage or that money damages would not provide an adequate remedy, it being
acknowledged and agreed that any such breach or threatened breach will cause irreparable injury to the non-breaching party and
that monetary damages will not provide adequate remedy to the non-breaching party.

 

8.4         Commercially
Reasonable Efforts; Further Assurances. Subject to the terms and conditions of this Agreement, each party shall use commercially
reasonable efforts to take, or cause to be taken, all actions and to do, or cause to be done, all things necessary or desirable
under applicable Laws, to consummate and implement expeditiously each of the transactions contemplated by this Agreement.

 

8.5         Notification
of Certain Matters. Each of Buyer and the Company shall give prompt notice to the other (and, if in writing, furnish copies
of) if any of the following occurs after the date of this Agreement: (i) there has been a material failure on the part of the party
providing the notice to comply with or satisfy any covenant, condition or agreement to be complied with or satisfied by it hereunder;
(ii) receipt of any notice or other communication in writing from any third party alleging that the consent of such third party
is or may be required in connection with the transactions contemplated by this Agreement; (iii) receipt of any notice or other
communication from any Authority in connection with the transactions contemplated by this Agreement; (iv) the discovery of any
fact or circumstance that, or the occurrence or non-occurrence of any event the occurrence or non-occurrence of which, would reasonably
be expected to cause or result in any of the conditions set forth in ARTICLE IX not being satisfied or the satisfaction of those
conditions being materially delayed; or (v) the commencement or threat, in writing, of any Action against any party or any of its
Affiliates, or any of their respective properties or assets, or, to the knowledge of the Company or Buyer, as applicable, any officer,
director, partner, member or manager, in his or her capacity as such, of the Company or Buyer, as applicable, or any of their Affiliates
with respect to the consummation of the transactions contemplated by this Agreement.  No such notice to any party shall
constitute an acknowledgement or admission by the party providing notice regarding whether or not any of the conditions to Closing
or to the consummation of the transactions contemplated hereby have been satisfied or in determining whether or not any of the
representations, warranties or covenants contained in this Agreement have been breached.

 

    	46

    	 

    

  

8.6         Tax
Matters.

 

(a)         Elite
shall prepare (or cause to be prepared) and file (or cause to be filed) on a timely basis (taking into account valid extensions
of time to file) all Tax Returns of the Company and its Subsidiaries required to be filed by the Company and its Subsidiaries after
the Closing Date for taxable periods ending on or before the Closing Date. Such Tax Returns shall be true, correct and complete,
shall be prepared on a basis consistent with the similar Tax Returns for the immediately preceding taxable period, and shall not
make, amend, revoke or terminate any Tax election or change any accounting practice or procedure without the prior written consent
of the Buyer, which consent shall not be unreasonably withheld, delayed or conditioned. The cost of preparing such Tax Returns
shall be borne by Elite. Elite shall give a copy of each such Tax Return to the Buyer with sufficient time prior to filing for
its review and comment. Elite (prior to the Closing) and the Buyer (following the Closing) shall cause the Company and its Subsidiaries
to cooperate in connection with the preparation and filing of such Tax Returns, to timely pay the Tax shown to be due thereon,
and to furnish the Buyer proof of such payment. Elite shall not file (or permit the Company or any of its Subsidiaries to file)
any amended Tax Return, including any carryback claim or other adjustment with respect to a Pre-Closing Period without the prior
written consent of the Buyer.

 

(b)         Buyer
shall prepare (or cause to be prepared) and file (or cause to be filed) on a timely basis (taking into account valid extensions
of time to file) all Tax Returns of the Company and its Subsidiaries for taxable periods including the Closing Date but ending
after the Closing Date. Any such Tax Returns for a period that includes the Closing Date shall be true, correct and complete in
all material respects, shall be prepared on a basis consistent with the similar Tax Returns for the immediately preceding taxable
period, and shall not make, amend, revoke or terminate any tax election or change any accounting practice or procedure without
the prior consent of Elite, which consent shall not unreasonably be withheld, delayed or conditioned. Buyer shall deliver any such
Tax Return to Elite for its review and comment at least thirty (30) days prior to the date on which such Tax Return is required
to be filed and shall make such revisions to such tax Returns as are reasonably requested by Elite. If Elite disputes any item
on such Tax Return, it shall notify the Buyer no later than ten (10) days from receipt of such tax Return of such disputed item
(or items) and the basis for its objection and the Buyer and Elite shall act in good faith to resolve any such dispute prior to
the date on which the relevant Tax Return is required to be filed. If the parties cannot resolve any disputed item, the item in
question shall be resolved by an independent accounting firm mutually acceptable to the Buyer and Elite and the fees and expenses
of such accounting firm shall be borne equally by the Buyer and Elite.

 

    	47

    	 

    

  

(c)         Following
the Closing, Elite may amend any Tax Return of the Company and its Subsidiaries for any taxable period ending on or before the
Closing with consent of Buyer, which consent shall not be unreasonably withheld, delayed or conditioned. Buyer shall cause the
Company and its Subsidiaries to cooperate in connection with the preparation and filing of such amended Tax Returns and any Tax
Proceeding in connection therewith. The cost of preparing and filing such amended Tax Returns or participating in any such Tax
proceeding shall be borne by Elite.

 

(d)         Following
the Closing, the Buyer may amend any Tax Return of the Company and its Subsidiaries for any taxable period ending on or before
the Closing to correct any errors, with the consent of Elite, which consent shall not unreasonably be withheld, delayed or conditioned.
The cost of preparing and filing such amended Tax Returns shall be borne by the Buyer.

 

(e)         If,
following the Closing, the Company or any Subsidiary receives any refund of or credit for Taxes attributable (or allocable thereto
pursuant to subsection (8.6(h)) to periods ending on or prior to the Closing Date, the Buyer shall promptly deliver an equivalent
amount to ELITE.

 

(f)         Buyer
and Elite shall cooperate in (i) the preparation of all Tax Returns for any Tax periods; and (ii) the conduct of any Tax Proceeding
for which one party could reasonably require the assistance of the other party in obtaining any necessary information.

 

(g)         Buyer
shall retain (or cause the Company and its Subsidiaries to retain) all Books and Records with respect to Tax matters of the Company
and its Subsidiaries for Pre-Closing Periods for at least seven (7) years following the Closing Date and to abide by all record
retention agreements entered into by or with respect to the Company or any of its Subsidiaries with any Taxing Authority.

 

(h)         To
the extent permitted by applicable Law, the parties shall elect (and shall cause the Company and its Subsidiaries to elect) to
treat the taxable period that includes but does not end on the Closing Date with respect to any Tax of the Company and its Subsidiaries
as ending at the close of the Closing Date, and shall take such steps as may be necessary therefor. For purposes of this Agreement,
any Tax for a taxable period that includes but that does not end on the Closing Date shall be allocated between the Pre-Closing
Period and the balance of the taxable period based on an interim closing of the books as of the end of the Closing Date; provided,
however, that any real or personal property Tax, fixed dollar franchise Tax, any annual exemption amount or any other Tax other
than a Tax based upon or related to income or receipts or imposed on a transactional basis shall be allocated based on the relative
number of days in the Pre-Closing Period and the balance of the taxable period.

 

(i)         All
sales, use, transfer and other similar Taxes imposed by a Taxing Authority with respect to any transaction contemplated by this
Agreement shall be duly and timely paid by Elite. Elite shall duly and timely file all Tax Returns in connection with such Taxes.
Elite shall give a copy of each such Tax Return to the Buyer for its review with sufficient time for comments prior to filing and
shall give the Buyer a copy of such Tax Return promptly after filing, together with proof of payment of the Tax shown thereon to
be due.

    	48

    	 

    

  

8.7         Compliance
with IPO Agreements. The Buyer shall comply with each of the agreements entered into in connection with the Buyer’s IPO.
The Buyer shall use commercially reasonable efforts to have filed and have one or more registration statements declared effective
by the SEC registering the exercise of the warrants issued as part of the Units sold in the Buyer’s IPO and registering for
resale the securities, and the securities underlying such securities, of the Buyer outstanding immediately prior to the Buyer’s
IPO, in each case within 6 months from the Closing Date.

 

8.8         Form
6-K.

 

(a)         Company
Cooperation. The Company acknowledges that a substantial portion of the filings with the SEC and mailings to Buyer’s stockholders
shall include disclosure regarding the Company and its management, operations and financial condition. Accordingly, the Company
agrees to as promptly as reasonably practical provide Buyer with such information as shall be reasonably requested by Buyer for
inclusion in a Report of Foreign Private Issuer on Form 6-K to be filed with the SEC, that is accurate in all material respects
and complies as to form in all material respects with the requirements of the Exchange Act and the rules and regulations promulgated
thereunder and in addition the Company shall provide as soon as available to it the same financial and other information about
the Company as is required under Regulation 14A of the Exchange Act regulating the solicitation of proxies even if such information
is not required under applicable rules. The Company understands that such information shall be included in the Form 6-K described
in this section. The Company shall make, and cause each Subsidiary to make, their managers, directors, officers and employees available
to Buyer and its counsel in connection with the drafting of such filings and mailings and responding in a timely manner to comments
from the SEC.

 

(b)         Other
Information. None of the information supplied or to be supplied by the Company or Elite expressly for inclusion or incorporation
by reference in the filings with the SEC or the mailings to Buyer’s stockholders will, at the date of filing or mailing,
or any amendment thereto, as the case may be, contain any untrue statement of a material fact or omit to state any material fact
required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they
are made, not misleading (subject to the qualifications and limitations set forth in the materials provided by the Company and/or
that is included in the SEC filings or mailings).

 

8.9         Registration
of Buyer Common Stock. Buyer shall enter into a Registration Rights Agreement with the CIS Sponsor and any other such parties
with the rights to require the Buyer to register any securities of the Buyer held by such parties under the Securities Act of
1933, as amended, to terminate such demand registration rights and grant such parties piggyback registration rights, a form of
which shall be mutually agreed upon by the parties prior to Closing (the “Registration Rights Agreement”).

 

8.10        Trust
Account. The Buyer shall make appropriate arrangements to cause the funds in the Trust Account to be disbursed in accordance
with the Trust Agreement and (i) all amounts payable to stockholders of Buyer Common Stock who shall have chosen to participate
in the transaction and not withdrawn their shares of Buyer Common Stock as per the conditions of the Form 6-K upon acceptance by
the Buyer of such shares, (ii) the expenses to the third parties to which they are owed, and (iii) the remaining monies in the
Trust Account to Buyer.

 

    	49

    	 

    

  

ARTICLE IX

CONDITIONS TO CLOSING

 

9.1         Condition
to the Obligations of the Parties. The obligations of all of the parties to consummate the Closing are subject to the satisfaction
of all the following conditions:

 

(b)         no
provision of any applicable Law, and no Order shall prohibit or impose any condition on the consummation of the Closing,

 

(c)         there
shall not be pending any Action brought by a third-party non-Affiliate to enjoin or otherwise restrict the consummation of the
Closing,

 

(d)         holders
of not less than (12.5%) of the IPO Equity Interests shall have agreed to convert to from Series A Equity Interests to Series C
Equity Interests (each as defined in the Company’s Amended and Restated Articles of Association) in connection with the Closing.

 

(e)         All
authorizations, approvals and permits required to be obtained from or made with any Authority in order to consummate the transactions
contemplated by this Agreement shall have been obtained or made.

 

(f)         No
court, arbitrator or other Authority shall have issued any judgment, injunction, decree or order, or have pending before it a proceeding
for the issuance of any thereof, and there shall not be any provision of any applicable Law restraining or prohibiting the consummation
of the Closing, the ownership by Buyer of any of the Shares or the effective operation of the Business by the Company and its Subsidiaries
after the Closing Date.

 

(g)         Each
party shall have entered into and delivered a counterpart signature page of each Additional Agreement that is not required to be
delivered pursuant to Section 9.2 or 9.3 hereof to which it is a party.

 

9.2         Conditions
to Obligations of Buyer. The obligation of Buyer to consummate the Closing is subject to the satisfaction, or the waiver at
Buyer’s sole and absolute discretion, of all the following further conditions:

 

(a)         The
Company shall have duly performed in all material respects all of its obligations hereunder required to be performed by it at or
prior to the Closing Date.

 

(b)         The
representations and warranties contained in Sections 3.2, 3.5, 4.1 and 4.2 shall be true and correct in all respects (except for
any de minimis inaccuracies therein) both when made and as of the Closing Date and all other representations and warranties of
the Company and Elite contained in this Agreement and the Additional Agreements, disregarding all qualifications and exceptions
contained therein relating to materiality or Material Adverse Effect, shall: (i) be true, correct and complete at and as of the
date of this Agreement, or, (ii) if otherwise specified, when made or when deemed to have been made, and (iii) shall be true, correct
and complete as of the Closing Date, in each case with only such exceptions as could not in the aggregate reasonably be expected
to have a Material Adverse Effect.

    	50

    	 

    

  

(c)         No
Material Adverse Effect shall have occurred since the date of this Agreement.

 

(d)         Buyer
shall have received a certificate signed by the Chief Executive Officer of the Company to the effect set forth in clauses (a) through
(c) of this Section 9.2.

 

(e)         Buyer
shall have received all documents it may reasonably request relating to the existence of the Company and its Subsidiaries and the
authority of the Company to enter into and perform under this Agreement, all in form and substance reasonably satisfactory to Buyer
and its legal counsel, including (i) a copy of the certificate of incorporation or comparable document of formation of the Company
and any of its Subsidiaries certified as of a recent date by the appropriate Authority of its jurisdiction of organization, (ii)
copies of the Company’s and any of its Subsidiaries’ by-laws or comparable company organizational document of the Company
and any of its Subsidiaries as effective on the date hereof; (iii) copies of resolutions duly adopted by the board of directors
of the Company and by the unanimous vote or consent of Elite authorizing this Agreement, the Additional Agreements and the transaction
contemplated hereby and thereby, (iv) a certificate of the Secretary of Elite and the Company certifying as to signatures of the
officers executing this Agreement and any certificate or document to be delivered pursuant hereto, together with evidence of the
incumbency of such Secretary, and (v) a recent good standing certificate regarding the Company and any of its Subsidiaries from
the office of any appropriate Authority of each other jurisdiction in which the Company and any of its Subsidiaries are qualified
to do business.

 

(f)         Buyer
shall have received from the Elite Shareholders certificates representing the Equity Interests, duly endorsed in blank by the Elite
Shareholders, or accompanied by stock powers duly executed in blank by the Elite Shareholders, with all necessary transfer Tax
and other revenue stamps, acquired at the Elite Shareholders’s expense, affixed.

 

(g)         Buyer
shall have received copies of all Company Consents (including the consents of the landlords under the Leases), in form and substance
reasonably satisfactory to Buyer, and no such Company Consent shall have been revoked.

 

(h)         Each
party other than the Buyer and any Affiliates of the Buyer shall have entered into each of the Additional Agreements.

 

(i)         Buyer
shall have received the Audited Financial Statements.

 

(j)         Buyer
shall have received the Company Disclosure Schedules by no later than September 17, 2014 and shall have been satisfied, in the
Buyer’s sole discretion, with the contents of such Company Disclosure Schedules.

 

9.3         Conditions
to Obligations of the Company and Elite. The obligation of the Company and Elite to consummate the Closing is subject to the
satisfaction, or the waiver at the Company and Elite sole and absolute discretion, of all the following further conditions:

    	51

    	 

    

  

(a)         Buyer
shall have performed in all material respects all of its obligations hereunder required to be performed by it at or prior to the
Closing Date, and the representations and warranties of Buyer contained in this Agreement and in any certificate or other writing
delivered by Buyer pursuant hereto, disregarding all qualifications and expectations contained therein relating to materiality
and Material Adverse Effect shall be true and correct in all material respects at and as of the Closing Date, as if made at and
as of such date.

 

(b)         The
Buyer shall have duly performed in all material respects all of its obligations hereunder required to be performed by it at or
prior to the Closing Date.

 

(c)         No
Buyer Material Adverse Effect shall have occurred since the date of this Agreement.

 

(d)         The
Company shall have received a certificate signed by the Chief Executive Officer of the Buyer to the effect set forth in clauses
(a) through (c) of this Section 9.3.

 

(e)         Buyer
shall have entered into and delivered a counterpart signature page to the Registration Rights Agreement.

 

(f)         Each
party other than the Company, Elite and their Affiliates shall have entered into the Additional Agreements.

 

(g)         The
Company shall have received all documents it may reasonably request relating to the existence of the Buyer and the authority to
enter into and perform under this Agreement, all in form and substance reasonably satisfactory to the Company and its legal counsel,
including (i) a copy of the certificate of incorporation or comparable document of formation of the Buyer certified as of a recent
date by the appropriate Authority of its jurisdiction of organization, (ii) copies of the Buyer’s by-laws or comparable company
organizational document of the Buyer as effective on the date hereof; (iii) copies of resolutions duly adopted by the board of
directors of the Buyer authorizing this Agreement, the Additional Agreements and the transaction contemplated hereby and thereby,
(iv) a certificate of the Secretary of the Buyer certifying as to signatures of the officers executing this Agreement and any certificate
or document to be delivered pursuant hereto, together with evidence of the incumbency of such Secretary, and (v) a recent good
standing certificate regarding the Buyer from the office of any appropriate Authority of each other jurisdiction in which the Buyer
is qualified to do business.

 

(h)         Prior
to the Closing Date, an application covering all shares of Buyer Common Stock, including the Escrow Shares, to be issued to the
Elite Shareholders, shall have submitted for approval for listing on the Exchange, and the Buyer shall not have received any notification
that the Exchange is contemplating terminating such listing.

 

(i)         Buyer
shall have at least $5,000,000 in cash at the Closing, after payment of any and all expenses of Buyer incurred prior to the Closing
Date.

 

(j)         The
Company shall have received resignations of the directors and officers of Buyer and the officers and the Board of Directors of
Buyer shall be constituted as set forth in the Voting Agreement immediately after the Closing.

    	52

    	 

    

  

(k)         No
holders of any securities of the Buyer or any rights exercisable for or convertible or exchangeable into securities of the Buyer
have any “demand” right to require the Buyer to register any such securities of the Company under the Securities Act
of 1933, as amended.

 

ARTICLE X

INDEMNIFICATION

 

10.1        Indemnification
Obligation of the Company. The Company shall indemnify and hold harmless Buyer, and its members, managers, partners, directors,
officers, employees, stockholders, attorneys and agents and permitted assignees (the “Buyer Indemnitees”), against
and in respect of any and all out-of-pocket loss, liability, claim (including claims by third parties), cost (including reasonable
attorneys’ fees), judgment, damage or expense, but excluding consequential, incidental and punitive damages; any loss of
future revenue, income or profits; loss of business reputation or opportunity; or multiples of earnings damages, other than any
such damages or losses paid to any third party pursuant to a judgment awarded by a court of competent jurisdiction or a final arbitration
award in respect of a third party claim (all of the foregoing collectively, “Losses”) incurred or sustained
by any Buyer Indemnitee as a result of or in connection with any breach or inaccuracy of any of the representations, warranties,
or covenants of the Company contained in this Agreement; provided, however, that the Buyer Indemnitees shall not be entitled to
indemnification pursuant to this Section 10.1 unless and until the aggregate amount of Losses to the Buyer Indemnitees equals at
least $100,000 (the “Basket”), at which time, subject to the limitations set forth in Section 10.4, the Buyer
Indemnitees shall be entitled to indemnification for the total amount of such Losses without regard to the Basket.

 

10.2        Indemnification
Obligation of Buyer. Buyer shall indemnify and hold harmless Elite, the Company and each of their respective members, managers,
partners, directors, officers, employees, stockholders, attorneys and agents and permitted assignees (the “Elite Indemnitees”)
against and in respect of any and all Losses incurred or sustained by the Elite Indemnitees as a result of any breach or inaccuracy
of any of the representations, warranties or covenants of Buyer contained in this Agreement. The maximum aggregate liability of
the Buyer to the Elite Indemnitees with respect to Losses pursuant to this Section 10.3 shall not exceed $1,000,000; provided,
however, the Elite Indemnitees shall not be entitled to indemnification pursuant to this Section 10.3 unless and until the aggregate
amount of Losses to the Elite Indemnitees equals at least the Basket, at which time, subject to the aggregate liability noted above
and Section 10.4, the Elite Indemnitees shall be entitled to indemnification for the total amount of such Losses without regard
to the Basket.

 

10.3        Limitations
on Indemnification. Notwithstanding anything to the contrary set forth herein, the parties rights to indemnification hereunder
are subject to the following limitations:

 

    	53

    	 

    

  

(a)         The
maximum aggregate liability of the Company and Elite to the Buyer Indemnitees with respect to Losses pursuant to Sections 10.1
and 10.2 and the Buyer Indemnitees’ sole source of indemnification payments from the Company and Elite pursuant to Sections
10.1 and 10.2 shall be claims against the Escrow Shares in accordance with this Agreement and the Escrow Agreement (except for
such Losses incurred or sustained by any Buyer Indemnitee as a result of or in connection with any breach by the Company of those
covenants set forth in Section 6.9, in which case the liability of the Company to the Buyer Indemnitees for such Losses shall be
$5,000,000, which amount shall be payable in cash). The amount of indemnification obligations of Company and Elite as set forth
in this ARTICLE X shall be the maximum amount of indemnification obligations set forth hereunder, and the Buyer Indemnitees
shall not be entitled to a rescission of this Agreement (or any Additional Agreements) or any further indemnification rights or
claims of any nature whatsoever, all of which are hereby expressly waived by Buyer on behalf of Buyer and all other Buyer Indemnitees
to the fullest extent permitted under applicable Law. Buyer Indemnitees shall be entitled to only a single recovery for all Losses
that arise in connection with the matter giving rise to a breach of representation, warranty or covenant, even if such matter shall
involve breaches of multiple representations, warranties and covenants. Each share of Buyer Common Stock distributed from the Escrow
Shares in satisfaction of an indemnity claim for Losses pursuant to this ARTICLE X shall be deemed to satisfy an amount of Losses
equal to $10.40. Any fractional shares will be rounded to the nearest whole share.

 

(b)         Any
claim for indemnification hereunder may not be pursued and is hereby irrevocably waived upon and after the Expiration Date.

 

(c)         The
Company and Elite may only seek indemnification hereunder against Buyer and Buyer may only seek indemnification hereunder against
the Company and Elite. The parties hereby irrevocably waive in perpetuity any and all claims for indemnification hereunder against
the officers, directors, members, and shareholders of the parties hereto and all other Affiliates of such parties, except as expressly
set forth herein.

 

(d)         The
amount of any Losses subject to indemnification pursuant to Section 10.1 or of any claim therefor shall be calculated net of any
Tax Benefit inuring to the Buyer, the Company or any of their respective subsidiaries or Affiliates on account of such Losses and
any insurance proceeds received or receivable by the Buyer, the Company or any of their respective subsidiaries or Affiliates on
account of such Losses.

 

10.4        Indemnification
Procedures; Defense of Third-Party Claims. Any Buyer Indemnitees or Elite Indemnitees making a claim for indemnification under
Section 10.1, 10.2 or 10.3 (an “Indemnified Party“) shall promptly notify the indemnifying party (the “Indemnifying
Party”) in writing of any pending or threatened claim or demand that the Indemnified Party has determined has given or
would reasonably be expected to give rise to such right of indemnification (including a pending or threatened claim or demand asserted
by a third party against the Indemnified Party, such claim being a “Third-Party Claim“), describing in reasonable
detail the facts and circumstances with respect to the subject matter of such claim or demand; provided that the failure
to provide such notice shall not release the Indemnifying Party from any of its obligations under this Section 10.5 except to the
extent the Indemnifying Party is prejudiced by such failure, it being agreed that notices for claims in respect of a breach of
a representation, warranty, covenant or agreement must be delivered prior to the Expiration Date.

 

    	54

    	 

    

  

(a)         Upon
receipt of a notice of a Third-Party Claim for indemnity from an Indemnified Party pursuant to Section 10.1, 10.2 or 10.3, the
Indemnifying Party shall be entitled, by notice to the Indemnified Party delivered within twenty (20) Business Days of the receipt
of notice of such Third-Party Claim, to assume the defense and control of such Third-Party Claim; provided that (i) the
Indemnifying Party shall allow the Indemnified Party a reasonable opportunity to participate in the defense of such Third-Party
Claim with its own counsel and at its own expense and (ii) the Indemnifying Party shall pay the fees and expenses of one (1) counsel
(plus local counsel, if required) of the Indemnified Party in the event that the Third-Party Claim of which the Indemnifying Party
seeks to assume control (A) involves criminal allegations against the Indemnified Party, or (B) involves a claim that, in the good
faith judgment of the Indemnified Party, is inappropriate for joint representation because of an actual conflict of interest between
the Indemnified Party and the Indemnifying Party with respect to such Third-Party Claim. Such assumption of the conduct and control
of the settlement or defense shall not be deemed to be an admission or assumption of liability by the Indemnifying Party. If the
Indemnifying Party does not assume the defense and control of any Third-Party Claim pursuant to this Section 10.6, the Indemnified
Party shall be entitled to assume and control such defense, but the Indemnifying Party may nonetheless participate in the defense
of such Third-Party Claim with its own counsel and at its own expense. Elite or the Buyer, as the case may be, shall, and shall
cause each of its Affiliates and representatives to, reasonably cooperate with the Indemnifying Party in the defense of any Third-Party
Claim, including by furnishing books and records, personnel and witnesses, as appropriate for any defense of such Third-Party Claim.
If the Indemnifying Party has assumed the defense and control of a Third-Party Claim, it shall be authorized to consent to a settlement
or compromise of, or the entry of any judgment arising from, any Third-Party Claim, in its sole discretion and without the consent
of any Indemnified Party; provided, that such compromise, settlement or judgment does not involve any finding or admission
of any violation of Law or admission of any wrongdoing by any Indemnified Party. No Indemnified Party shall consent to the entry
of any judgment or enter into any settlement or compromise with respect to a Third-Party Claim without the prior written consent
of the Indemnifying Party.

 

10.5        Payment
of Indemnification. Any payments by Elite or the Company to a Buyer Indemnitee will be treated as an adjustment to the Purchase
Price.

 

10.6        Survival
of Indemnification Rights. The representations and warranties of the Company, Elite and Buyer shall survive until the date
that is twelve months following the Closing (the “Expiration Date”).

 

10.7        Exclusive
Remedy. The rights of the parties for indemnification relating to this Agreement or the transactions contemplated hereby shall
be strictly limited to those contained in this ARTICLE X, and, except as specifically set forth in Section 12.1(b) such indemnification
rights shall be the exclusive remedies of the parties with respect to any matter arising under or in connection with this Agreement.
To the maximum extent permitted by applicable Law, the parties hereby waive all other rights and remedies with respect to any matter
arising under or in connection with this Agreement, whether under any applicable Law, at common law or otherwise. Neither the Company,
nor Elite, nor any of their respective Affiliates, successors or permitted assigns, makes any representation, warranty or covenant
to Buyer or any of its Affiliates, successors or permitted assigns, except as set forth in this Agreement. Consequently, neither
Buyer nor any of its Affiliates, successors or permitted assigns may bring or otherwise maintain any claim, action or remedy against
the Company or Elite or any of their respective Affiliates, successors or permitted assigns, and no recourse shall be brought against
any of them, by virtue of any claim or allegation of any representation, warranty or covenant not set forth in this Agreement.

    	55

    	 

    

  

ARTICLE XI

DISPUTE RESOLUTION

 

11.1        Arbitration.

 

(a)         The
parties shall promptly submit any dispute, claim, or controversy arising out of or relating to this Agreement, or any Additional
Agreement (including with respect to the meaning, effect, validity, termination, interpretation, performance, or enforcement of
this Agreement or any Additional Agreement) or any alleged breach thereof (including any action in tort, contract, equity, or otherwise),
to binding arbitration before one arbitrator (“Arbitrator”), shall be binding, final and non-appealable and
not subject to this Section 11.1. The parties agree that binding arbitration shall be the sole means of resolving any dispute,
claim, or controversy arising out of or relating to this Agreement or any Additional Agreement (including with respect to the meaning,
effect, validity, termination, interpretation, performance or enforcement of this Agreement or any Additional Agreement) or any
alleged breach thereof (including any claim in tort, contract, equity, or otherwise).

 

(b)         If
the parties cannot agree upon the Arbitrator, the Arbitrator shall be selected by the New York, New York chapter head of the American
Arbitration Association upon the written request of either side. The Arbitrator shall be selected within thirty (30) days of such
written request.

 

(c)         The
laws of the State of New York shall apply to any arbitration hereunder. In any arbitration hereunder, this Agreement and any agreement
contemplated hereby shall be governed by the laws of the State of New York applicable to a contract negotiated, signed, and wholly
to be performed in the State of New York, which laws the Arbitrator shall apply in rendering his decision. The Arbitrator shall
issue a written decision, setting forth findings of fact and conclusions of law, within sixty (60) days after he shall have been
selected. The Arbitrator shall have no authority to award punitive or other exemplary damages.

 

(d)         The
arbitration shall be held in New York, New York in accordance with and under then-current provisions of the rules of the American
Arbitration Association, except as otherwise provided herein.

 

(e)         On
application to the Arbitrator, any party shall have rights to discovery to the same extent as would be provided under the Federal
Rules of Civil Procedure, and the Federal Rules of Evidence shall apply to any arbitration under this Agreement; provided, however,
that the Arbitrator shall limit any discovery or evidence such that his decision shall be rendered within the period referred to
in Section 11.1(c).

 

(f)         The
Arbitrator may, at his discretion and at the expense of the parties who will bear the cost of the arbitration, employ experts to
assist him in his determinations.

 

(g)         The
costs of the arbitration proceeding and any proceeding in court to confirm any arbitration award or to obtain relief as provided
in Section 8.3, as applicable (including actual attorneys’ fees and costs), shall be borne by the unsuccessful party and
shall be awarded as part of the Arbitrator’s decision, unless the Arbitrator shall otherwise allocate such costs in such
decision. The determination of the Arbitrator shall be final and binding upon the parties and not subject to appeal.

 

    	56

    	 

    

  

(h)         Any
judgment upon any award rendered by the Arbitrator may be entered in and enforced by any court of competent jurisdiction. The parties
expressly consent to the exclusive jurisdiction of the courts (Federal and state) in New York, New York to enforce any award of
the Arbitrator or to render any provisional, temporary, or injunctive relief in connection with or in aid of the Arbitration. The
parties expressly consent to the personal and subject matter jurisdiction of the Arbitrator to arbitrate any and all matters to
be submitted to arbitration hereunder. None of the parties hereto shall challenge any arbitration hereunder on the grounds that
any party necessary to such arbitration (including the parties hereto) shall have been absent from such arbitration for any reason,
including that such party shall have been the subject of any bankruptcy, reorganization, or insolvency proceeding.

 

(i)         The
parties shall indemnify the Arbitrator and any experts employed by the Arbitrator and hold them harmless from and against any claim
or demand arising out of any arbitration under this Agreement or any agreement contemplated hereby, unless resulting from the willful
misconduct of the person indemnified.

 

(j)         This
arbitration section shall survive the termination of this Agreement and any agreement contemplated hereby.

 

11.2        Waiver
of Jury Trial; Exemplary Damages.

 

(a)         THE
PARTIES TO THIS AGREEMENT HEREBY KNOWINGLY, VOLUNTARILY AND IRREVOCABLY WAIVE ANY RIGHT EACH SUCH PARTY MAY HAVE TO TRIAL BY JURY
IN ANY ACTION OF ANY KIND OR NATURE, IN ANY COURT IN WHICH AN ACTION MAY BE COMMENCED, ARISING OUT OF OR IN CONNECTION WITH THIS
AGREEMENT OR ANY ADDITIONAL AGREEMENT, OR BY REASON OF ANY OTHER CAUSE OR DISPUTE WHATSOEVER BETWEEN OR AMONG ANY OF THE PARTIES
TO THIS AGREEMENT OF ANY KIND OR NATURE. NO PARTY SHALL BE AWARDED PUNITIVE OR OTHER EXEMPLARY DAMAGES RESPECTING ANY DISPUTE ARISING
UNDER THIS AGREEMENT OR ANY ADDITIONAL AGREEMENT.

 

(b)         Each
of the parties to this Agreement acknowledge that each has been represented in connection with the signing of this waiver by independent
legal counsel selected by the respective party and that such party has discussed the legal consequences and import of this waiver
with legal counsel. Each of the parties to this Agreement further acknowledge that each has read and understands the meaning of
this waiver and grants this waiver knowingly, voluntarily, without duress and only after consideration of the consequences of this
waiver with legal counsel.

 

11.3        Attorneys’
Fees. The unsuccessful party to any Action arising out of this Agreement that is not resolved by arbitration under Section
11.1 shall pay to the prevailing party all attorneys’ fees and costs actually incurred by the prevailing party, in addition
to any other relief to which it may be entitled. As used in this Section 11.3 and elsewhere in this Agreement, “actual
attorneys’ fees” or “attorneys’ fees actually incurred” means the full and actual cost of any legal
services actually performed in connection with the matter for which such fees are sought, calculated on the basis of the usual
fees charged by the attorneys performing such services, and shall not be limited to “reasonable attorneys’ fees”
as that term may be defined in statutory or decisional authority.

 

    	57

    	 

    

  

ARTICLE XII

TERMINATION

 

12.1        Termination
Without Default; Termination Fee. In the event that the Closing of the transactions contemplated hereunder has not occurred
by September 21, 2014 (the “Outside Closing Date”), the Company, Elite or the Buyer shall have the right, at
its sole option, to terminate this Agreement without liability to the other parties hereto. Such right may be exercised by the
Company, Elite or the Buyer, as the case may be, giving written notice to the other parties hereto at any time after the Outside
Closing Date. In the event this Agreement is terminated pursuant to this Section 12.1(a), each party shall be responsible for paying
all of its own expenses.

 

12.2        Termination
Upon Default.

 

(a)         Buyer
may terminate this Agreement by giving notice to Elite on or prior to the Closing Date, without prejudice to any rights or obligations
Buyer may have, if the Company or Elite shall have materially breached any of its covenants, agreements, representations, and warranties
contained herein to be performed on or prior to the Closing Date.

 

(b)         Elite
may terminate this Agreement by giving notice to Buyer, without prejudice to any rights or obligations the Company or Elite may
have, if Buyer shall have materially breached any of its covenants, agreements, representations, and warranties contained herein
to be performed on or prior to the Closing Date.

 

12.3        Survival.
The provisions of this ARTICLE XIII shall survive any termination hereof pursuant to Article XII.

 

ARTICLE XIII

MISCELLANEOUS

 

13.1        Notices.
Any notice hereunder shall be sent in writing, addressed as specified below, and shall be deemed given: (a) if by hand or recognized
courier service, by 4:00PM on a business day, addressee’s day and time, on the date of delivery, and otherwise on the first
business day after such delivery; (b) if by fax or email, on the date that transmission is confirmed electronically, if by 4:00PM
on a business day, addressee’s day and time, and otherwise on the first business day after the date of such confirmation;
or (c) five days after mailing by certified or registered mail, return receipt requested. Notices shall be addressed to the respective
parties as follows (excluding telephone numbers, which are for convenience only), or to such other address as a party shall specify
to the others in accordance with these notice provisions:

 

    	58

    	 

    

  

if to Buyer or the
Company (following the Closing), to:

 

CIS Acquisition Ltd.

89 Udaltsova Street, Suite 84

Moscow, Russia 119607

Attention: Kyle Shostak

Email: kyle.shostak@cisacquisition.com

 

with a copy to (which shall not constitute notice):

Loeb & Loeb LLP

345 Park Avenue

New York, New York 10154

Attention: Mitchell S. Nussbaum, Esq.

Telecopy: 212.504.3013

 

if to Elite, or the Company
(prior to the Closing):

 

Elite Ride Limited

16 Kaifada Road

Danyang,
Jiangsu, China

Attention:
Xin Chao

Fax +86
511 8692 0003

 

Delta Advanced Materials
Limited

16 Kaifada Road

Danyang,
Jiangsu, China

Attention:
Xin Chao

Fax +86
511 8692 0003

 

with a copy to (which shall
not constitute notice):

 

Sichenzia Ross Friedman Ference LLP

61 Broadway, 32nd Floor

New York, New York 10006

Attention: Richard A. Friedman, Esq.

Telecopy: (212) 930-9725

 

13.2        Amendments;
No Waivers; Remedies.

 

(a)         This
Agreement cannot be amended, except by a writing signed by each party, or terminated orally or by course of conduct. No provision
hereof can be waived, except by a writing signed by the party against whom such waiver is to be enforced, and any such waiver shall
apply only in the particular instance in which such waiver shall have been given.

 

    	59

    	 

    

  

(b)         Neither
any failure or delay in exercising any right or remedy hereunder or in requiring satisfaction of any condition herein nor any course
of dealing shall constitute a waiver of or prevent any party from enforcing any right or remedy or from requiring satisfaction
of any condition. No notice to or demand on a party waives or otherwise affects any obligation of that party or impairs any right
of the party giving such notice or making such demand, including any right to take any action without notice or demand not otherwise
required by this Agreement. No exercise of any right or remedy with respect to a breach of this Agreement shall preclude exercise
of any other right or remedy, as appropriate to make the aggrieved party whole with respect to such breach, or subsequent exercise
of any right or remedy with respect to any other breach.

 

(c)         Except
as otherwise expressly provided herein, no statement herein of any right or remedy shall impair any other right or remedy stated
herein or that otherwise may be available.

 

(d)         Notwithstanding
anything else contained herein, neither shall any party seek, nor shall any party be liable for, punitive or exemplary damages,
under any tort, contract, equity, or other legal theory, with respect to any breach (or alleged breach) of this Agreement or any
provision hereof or any matter otherwise relating hereto or arising in connection herewith.

 

13.3        Arms’
length bargaining; no presumption against drafter. This Agreement has been negotiated at arms-length by parties of equal bargaining
strength, each represented by counsel or having had but declined the opportunity to be represented by counsel and having participated
in the drafting of this Agreement. This Agreement creates no fiduciary or other special relationship between the parties, and no
such relationship otherwise exists. No presumption in favor of or against any party in the construction or interpretation of this
Agreement or any provision hereof shall be made based upon which Person might have drafted this Agreement or such provision.

 

13.4        Publicity.
Except as required by law, the parties agree that neither they nor their agents shall issue any press release or make any other
public disclosure concerning the transactions contemplated hereunder without the prior approval of the other party hereto.

 

13.5        Expenses.
Except as otherwise expressly set forth herein, all costs and expenses incurred in connection with this Agreement and the transactions
contemplated hereby shall be paid by the party incurring such cost or expense.

 

13.6        No
Assignment or Delegation. No party may assign any right or delegate any obligation hereunder, including by merger, consolidation,
operation of law, or otherwise, without the written consent of the other party. Any purported assignment or delegation without
such consent shall be void, in addition to constituting a material breach of this Agreement.

 

13.7        Governing
Law. This Agreement shall be construed in accordance with and governed by the laws of the State of New York, without giving
effect to the conflict of laws principles thereof.

 

13.8        Counterparts;
facsimile signatures. This Agreement may be executed in counterparts, each of which shall constitute an original, but all of
which shall constitute one agreement. This Agreement shall become effective upon delivery to each party of an executed counterpart
or the earlier delivery to each party of original, photocopied, or electronically transmitted signature pages that together (but
need not individually) bear the signatures of all other parties.

 

    	60

    	 

    

  

13.9        Entire
Agreement. This Agreement together with the Additional Agreements, sets forth the entire agreement of the parties with respect
to the subject matter hereof and thereof and supersedes all prior and contemporaneous understandings and agreements related thereto
(whether written or oral), all of which are merged herein. No provision of this Agreement or any Additional Agreement may be explained
or qualified by any agreement, negotiations, understanding, discussion, conduct or course of conduct or by any trade usage. Except
as otherwise expressly stated herein or any Additional Agreement, there is no condition precedent to the effectiveness of any provision
hereof or thereof. No party has relied on any representation from, warranty or agreement of any person in entering into this Agreement,
prior or contemporaneous or any Additional Agreement, except those expressly stated herein or therein.

 

13.10      Severability.
A determination by a court or other legal authority that any provision that is not of the essence of this Agreement is legally
invalid shall not affect the validity or enforceability of any other provision hereof. The parties shall cooperate in good faith
to substitute (or cause such court or other legal authority to substitute) for any provision so held to be invalid a valid provision,
as alike in substance to such invalid provision as is lawful.

 

13.11      Construction
of certain terms and references; captions. In this Agreement:

 

(a)         References
to particular sections and subsections, schedules, and exhibits not otherwise specified are cross-references to sections and subsections,
schedules, and exhibits of this Agreement.

 

(b)         The
words “herein,” “hereof,” “hereunder,” and words of similar import refer to this Agreement
as a whole and not to any particular provision of this Agreement, and, unless the context requires otherwise, “party”
means a party signatory hereto.

 

(c)         Any
use of the singular or plural, or the masculine, feminine, or neuter gender, includes the others, unless the context otherwise
requires; “including” means “including without limitation;” “or” means “and/or;”
“any” means “any one, more than one, or all;” and, unless otherwise specified, any financial or accounting
term has the meaning of the term under United States generally accepted accounting principles as consistently applied heretofore
by party.

 

(d)         Unless
otherwise specified, any reference to any agreement (including this Agreement), instrument, or other document includes all schedules,
exhibits, or other attachments referred to therein, and any reference to a statute or other law includes any rule, regulation,
ordinance, or the like promulgated thereunder, in each case, as amended, restated, supplemented, or otherwise modified from time
to time. Any reference to a numbered schedule means the same-numbered section of the disclosure schedule.

 

(e)         If
any action is required to be taken or notice is required to be given within a specified number of days following a specific date
or event, the day of such date or event is not counted in determining the last day for such action or notice. If any action is
required to be taken or notice is required to be given on or before a particular day which is not a Business Day, such action or
notice shall be considered timely if it is taken or given on or before the next Business Day.

    	61

    	 

    

  

(f)         Captions
are not a part of this Agreement, but are included for convenience, only.

 

(g)         For
the avoidance of any doubt, all references in this Agreement to “the knowledge or best knowledge of the Company” or
similar terms shall be deemed to include the actual knowledge of Mr. Xin Chao and Mr. Richard Yan.

 

13.12      Further
Assurances. Each party shall execute and deliver such documents and take such action, as may reasonably be considered within
the scope of such party’s obligations hereunder, necessary to effectuate the transactions contemplated by this Agreement.

 

13.13      Third
Party Beneficiaries. Neither this Agreement nor any provision hereof confers any benefit or right upon or may be enforced by
any Person not a signatory hereto.

 

13.14      Waiver.
Reference is made to the final prospectus of the Buyer, dated December 18, 2012 (the “Prospectus”). The Company
and Elite have read the Prospectus and understand that the Buyer has established the Trust Account for the benefit of the public
stockholders of the Buyer and the underwriters of the IPO pursuant to the Trust Agreement and that, except for a portion of the
interest earned on the amounts held in the Trust Account, the Buyer may disburse monies from the Trust Account only for the purposes
set forth in the Trust Agreement. For and in consideration of the Buyer agreeing to enter into this Agreement with the other parties
hereto, Elite and the Company each hereby agrees that it does not have any right, title, interest or claim of any kind in or to
any monies in the Trust Account and hereby agrees that it will not seek recourse against the Trust Account for any claim it may
have in the future as a result of, or arising out of, any negotiations, contracts or agreements with the Buyer. This Section 13.14
shall not limit any covenant or agreement of the parties that by its terms contemplates performance after the Closing.

 

[The remainder of this page intentionally
left blank; signature pages to follow]

 

    	62

    	 

    

 

IN WITNESS WHEREOF, Buyer,
the Company and Elite have caused this Agreement to be duly executed by their respective authorized officers and Elite have executed
this Agreement as of the day and year first above written.

 

	BUYER:	 	 
	 	CIS ACQUISITION LTD.
	 	 	 
	 	By:	/s/ Kyle Shostak
	 	 	Name:Kyle Shostak
	 	 	Title: Director
	ELITE:	 	 
	 	ELITE RIDE LIMITED
	 	 	 
	 	By:	/s/ Chao Xin
	 	 	Name: Chao Xin
	 	 	Title: Chief Executive Officer and Chairman
	COMPANY:	 	 
	 	DELTA ADVANCED MATERIALS LIMITED
	 	 	 
	 	By:	/s/ Chao Xin
	 	 	Name: Chao Xin
	 	 	Title: Chief Executive Officer and Chairman

 

	CIS Sponsor, only with respect to Section 7.4:
	 
	 	CIS ACQUISITION HOLDING CO. LTD.
	 	 	 
	 	By:	/s/ Taras Vaznhov
	 	 	Name: Taras Vaznhov
	 	 	Title:  Director
	 	 	 
	 	/s/ Kyle Shostak
	 	Kyle Shostak

 

    	63

    	 

    

 

	
         SHAREHOLDERS:
	 	 
	 	 	 
	 	MASTER KINGDOM HOLDINGS LTD.
	 	 	 
	 	By:	/s/ Chao Xin
	 	 	Name:  Chao Xin
	 	 	 
	 	 	 

    	64

    	 

    

  

EXHIBIT A

 

EARNOUT

 

An aggregate of 1,500,000 shares of ordinary
shares of the Buyer shall be issued to the Elite Shareholders as indicated on Schedule I. The determination of whether or
not the targets are achieved shall be based on the Company’s audited financial statements applicable period.

 

		a.	500,000 shares shall be issued based if the Company
achieves Adjusted Net Income of at least $8 million for the period starting July 1, 2014 and ending June 30, 2015.

 

		b.	500,000 shares shall be issued if the combined company
achieves Adjusted Net Income of at least $9.2 million for the period starting July 1, 2015 and ending June 30, 2016.

 

		c.	500,000 shares shall be issued based if the combined
company achieves Adjusted Net Income of at least $10.6 million for the period starting July 1, 2016 and ending June 30, 2017.

 

		d.	For purposes of this Agreement “Adjusted Net
Income” shall be defined as the Net Income of the Company plus Interest expense and non-cash derivative expenses
related to the restructuring of investments from the Prior PE Investors plus/minus and loss/income derived from or attributable
to the exercise of the CIS Warrants and the exercise of any further rights granted to the CIS Sponsor and the Company as a result
of the transactions contemplated by this Agreement.

 

		e.	During the 13 months post-Closing, all material acquisitions
made by the post-merger company must be accretive to post-merger company earnings, i.e. the price/earnings paid by the post-merger
company for an acquisition target must be lower than the price/earnings of the post-merger company on the date of such acquisition.
A “material acquisition” is an acquisition that would, when comparing the most recent annual financial statements
of each company, result in a change of 5% or more to the Company’s revenue, net income, total liabilities or total assets.
To be “accretive”, an acquisition must be acquired at a P/E ratio that is at a 20% discount to the P/E ratio at which
the Company is trading (based on the last sales price) on the day prior to the date that the definitive agreement for the acquisition
is signed.

 

The foregoing targets
are to be met on an all-or-nothing basis, and there shall be no partial awards.

 

    	65ex10x7.htm

 

Exhibit 10.7

 

 

ASSET PURCHASE AGREEMENT

 

This Asset Purchase Agreement (this "Agreement") dated April 18, 2013 (the "Effective Date"), by and between Premier Energy Partners (I) LLC, a Colorado limited liability company ("Seller), and PetroShare Corp., a Colorado corporation ("Buyer"). Seller and Buyer shall hereinafter be referred to collectively as the "Parties" and individually as a "Party".

 

ARTICLE I

CERTAIN DEFINITIONS

 

Section 1.1 Defined Terms. Unless the context otherwise requires:

 

(a) the terms defined in this Agreement shall have the meanings specified, with each definition to be equally applicable both to the singular and the plural forms of the terms;

 

(b) all references in this Agreement to an "Article," "Section," or "subsection" shall be to an Article, Section, or subsection of this Agreement;

 

(c) the words "this Agreement," "hereof," "hereunder," "herein," "hereby," or words of similar import shall refer to this Agreement as a whole and not to a particular Article, Section, subsection, clause or other subdivision; and

 

(d) the words used herein shall include the masculine, feminine, and neuter gender.

 

Section 1.2 Interpretation. In construing this Agreement:

 

(a) examples shall not be construed to limit, expressly or by implication, the matter they illustrate;

 

(b) the word "includes" and its derivatives means "includes, but is not limited to" and corresponding derivative expressions;

 

(c) a defined term has its defined meaning throughout this Agreement and each exhibit, attachment, and schedule to this Agreement, regardless of whether it appears before or after the place where it is defined;

 

(d) each Exhibit to this Agreement is a part of this Agreement, but if there is any conflict or inconsistency between the main body of this Agreement and any Exhibit, the provisions of the main body of this Agreement shall prevail; and

 

(e) canons of construction or rules of interpretation that would construe any provision of this Agreement against the drafter, whether due to ambiguity or otherwise, shall not apply.

 

 

  

1

  

 

ARTICLE II

 

SALE AND PURCHASE; DUE DILIGENCE

 

Section 2.1 Sale and Purchase. Subject to the terms and conditions of this Agreement, Seller agrees to sell and convey to Buyer, and Buyer agrees to purchase from Seller, an undivided 100.00% of Seller's right, title and interest in the following described assets and properties (together, the "Assets"):

 

(a) the oil, gas and mineral leases and the leasehold estates created thereby, described in Schedule 2.1(a), together with corresponding interests in and to all related property and rights;

 

(b) the oil, gas and mineral leases and the leasehold estates created thereby, described in Schedule 2.1(b), together with corresponding interests in and to all related property and rights. Together the leases described in Schedule 2.1(a) and Schedule 2.1(b) are referred to herein as the "Leases". Buyer has conducted Due Diligence comprised of land contract work, Abstracts and Attorney Drilling Title Opinion used in providing Schedule 2.1(b). Buyer acknowledges that they will rely on Buck Peak LLC or its designee to provide documents delivering the NRI covering Section 25, T6N-R9OW, Moffat County, Colorado as follows:

 

	
·  

	
All Leases in W/2 Section 25, T6N-R9OW — 78.5% NRI delivered;

 

	
·  

	
Keith family Leases — 77.5% NRI delivered;

 

	
·  

	
Remaining Leases E/2 Section 25, T6N-R9OW — 78.5% NRI delivered

 

(c) all right, title and interest of Seller in and to the lands covered by, or subject to, or pooled or unitized with the Leases (together, the "Lands");

 

(d) all contracts and contractual rights, obligations, and interests described in Schedule 2.1(d), and to the extent transferable, all other material contracts and contractual rights, obligations, and interests, including but not limited to all farmout and farmin agreements, operating agreements, surface use agreements, lease agreements, and other contracts or agreements covering or affecting any of the Assets (together, the "Contracts");

 

(e) all data and information described in Schedule 2.1(e), and copies of all other 2D seismic data and interpretations thereof covering the Lands, together with the shot records and digital data suitable for reprocessing. In addition, Seller shall provide and assign to Buyer any planned or permitted 2D or 3D seismic shoot covering the Lands or parts thereof;

 

(f) all right, title and interest of Seller in and to or derived from the following insofar as the same are attributable to the Leases, Lands, or Contracts: (i) all rights with respect to the use and occupancy of the surface of and the subsurface depths under the Lands; (ii) all agreements and contracts, easements, rights-of-way, servitudes, and other estates; (iii) all real and personal property located in or upon the Lands or used in connection with the exploration, development or operation of the

 

 

  

2

  

Leases; and (iv) any and all lease files, title files, land files, division order files, marketing files, well files, abstracts, title opinions, production records, seismic, geological, geophysical and engineering data, and all other files, maps and data (in whatever form) arising out of or relating to the Leases or Lands or the ownership, use, development, maintenance or operation of the other Assets (the "Records"); and

 

(g)           Notwithstanding the foregoing, the transfer of the Assets pursuant

 

to this Agreement shall not include the assumption of any liability related to the Assets unless Buyer expressly assumes that liability herein.

 

Section 2.2 Review Period. With respect to Assets listed on Schedule 2.1(a) and Schedule 2.1(b), from the Effective Date up to and including April 19, 2013 (the "Review Period"), Buyer shall have the right to review the Records in the Seller's possession and confirm that no Defects exist with respect to the Assets.

 

(a) "Defects" shall consist of one or more Title Defects or Environmental Defects.

 

(b) "Title Defects" means encumbrances, encroachments, irregularities, or defects in title to the Assets that causes Seller's title to be less than Good and Marketable Title.

 

(c) "Good and Marketable Title" means such right, title or interest held by Seller that will entitle Buyer, in Buyer's sole discretion, to: (i) an interest in each Lease covering the number of net mineral acres described in the column marked "Net Mineral Acres" in Schedules 2.1(a) and 2.1(b); (ii) receive no less than the net revenue interest listed on Schedules 2.1(a) and 2.1(b) in each Lease; (iii) Leases with primary terms expiring on the dates set out for each of the Leases in Schedules 2.1(a) and 2.1(b); and (iv) sufficient rights under the Leases to allow Buyer to fully develop the oil, gas, and minerals covered by the Leases.

 

(d) "Environmental Defects" means the (i) failure of the Assets to comply with Environmental Laws, or (ii) the existence of any physical condition related to prior oil and gas operations that, in Buyer's discretion, would require Buyer to be responsible for taking corrective or remedial action with respect to such condition as a consequence of Buyer acquiring title to the Leases (referred to herein as a "Non­conforming Physical Condition"). To the extent that Buyer accepts a Lease (and the Lands covered thereby) as being free from Environmental Defects pursuant to the foregoing, Seller shall have no liability to Buyer with respect to the presence on such Lease (or Lands) of an Existing Well.

 

(e) "Environmental Laws" shall mean all applicable Laws relating to: (a) the control of any pollutant or potential pollutant or protection of the air, water, land or the environment, (b) solid, gaseous or liquid waste generation, handling, treatment, storage, disposal or transportation or (c) exposure to hazardous, toxic, explosive, corrosive or other substances alleged to be harmful. Environmental Laws shall include, but not be limited to, the Clean Air Act, 42 U.S.C. § 7401 et seq., the Clean Water Act, 33 U.S.C. § 1251 et seq., the Resource Conservation Recovery Act, 42 U.S.C. § 6901

 

 

 

 

  

3

  

et seq., the Superfund Amendments and Reauthorization Act, 42 U.S.C. § 11001 et seq., the Water Pollution Control Act, 33 U.S.C. § 1251 et seq., the Safe Drinking Water Act, 42 U.S.C. § 300f et seq. and the Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C. § 9601 et seq.

 

(f) "Laws" shall mean all applicable statutes, laws, ordinances, regulations, rules, rulings, orders, restrictions, requirements, writs, injunctions, decrees or other official acts of or by any Governmental Authority.

 

(g) "Governmental Authority" shall mean shall mean (i) the United States of America; (ii) any state, county, municipality or other governmental subdivision within the United States of America; and (iii) any court or any governmental department, commission, board, bureau, agency or other instrumentality of the United States of America or of any state, county, municipality or other governmental subdivision within the United States of America.

 

Section 2.3 Confirmation of Defects. In order to confirm that no Defects exist with respect to the Assets, Buyer shall, during the Review Period, have the right:

 

(a) to examine the Leases, Contracts, Records, and all other materials in Seller's possession or under Seller's control relating to the Assets, including, without limitation, geologic and engineering data, seismic data, unrecorded Contracts, revenue and expense records, suspense account records, division order files, well files and land and lease files (collectively, the "Data");

 

(b) to examine title to the Assets, based upon the Data and the public records of the county and state in which the Leases and Lands are located, at its sole cost, risk and expense;

 

(c) to physically inspect the Assets in order to ascertain the condition of the Leases and Lands and to determine the presence or absence of any wellbores, naturally occurring radioactive materials, environmental contaminations, materials of environmental concern, or violations of Environmental Laws.

 

Section 2.4 Cooperation. Seller shall cooperate with Buyer and provide Buyer with access to the Data in Seller's ofl•ices at reasonable hours. Buyer shall have the right, at its own expense, to photocopy any of such Data; provided, however, that if Closing does not occur Buyer shall, upon notice to Seller, return all copies of the Data to Seller.

 

Section 2.5 Access. Seller shall provide Buyer reasonable access to the Leases and Lands at Buyer's sole cost and expense.

 

Section 2.6 Defect Notices. On or before the expiration of the Review Period, Buyer shall provide notice to Seller regarding all Defects (each, a "Defect Notice"). A Defect Notice shall be in writing and shall include: (i) a description of the Assets affected by the Defect; and (ii) an explanation of the basis for the Defect.

 

  

4

  

 

Section 2.7 Cure Period. Upon receiving a Defect Notice, Seller shall have the right to remedy the Defect, to the reasonable satisfaction of Buyer, within six days following the expiration of the Review Period (the "Cure Period") unless extended by mutual agreement of the Parties. If Seller is unable to remedy any Defect to the satisfaction of Buyer prior to the expiration of the Cure Period, Buyer shall have the right to either (i) accept the uncured Defect and proceed to Closing, or (ii) terminate this Agreement, in which event each Party shall have no further obligation to the other hereunder. Buyer shall give Seller written notice of its election within three business days following the end of the Cure Period (the failure of Buyer to give notice within such three-day period shall be deemed to be its election to terminate this Agreement). Notwithstanding the foregoing, the parties shall always have the right to mutually agree to a new Purchase Price (as defined below) for the Assets to take into account the effect of uncured Defects.

 

ARTICLE Ill

CONSIDERATION AND PAYMENT

 

Section 3.1 Consideration. In consideration for the sale and conveyance of the Assets to Buyer, the Buyer shall pay the total purchase price described in this Section 3.1(a) and (b) (the "Purchase Price") and, at the direction of Seller, the Purchase Price shall be distributed directly to Seller's Members in the following manner:

 

(a) The sum of two hundred and twenty-three thousand four hundred dollars ($223,400.00) shall be due and payable at Closing to Seller's Members as described in the table in Section 3.2; and

 

(b) Buyer shall issue 67,000 shares of restricted common stock of Buyer (the "Shares"), valued at $1 per share, at Closing to the Seller's Members as described in the table in Section 3.2.

 

Section 3.2 Members Purchase Price Allocation Table.

 

	  	  	  	  
	
Member

	  	
Purchase Price Allocation

	
Frederick J. Witsell 

John H. Carpenter 

David L. Witsell 

Kyle A. Worsham

	  	
Allocation pursuant to Letter Offer signed February 22, 2013 

Allocation pursuant to Letter Offer signed February 28, 2013

Allocation pursuant to Letter Offer signed March 11, 2013

Allocation pursuant to Letter Offer signed March 15, 2013

	  	  	  	  

 

Section 3.3 Seller's Members. The Members of Seller listed in Section 3.2 (together "Seller's Members" or individually a "Member") shall each join in the representations and warranties in Sections 4.1 and 4.2 of this Agreement and shall execute this Agreement as provided on the signature page.

 

  

5

  

 

ARTICLE IV

REPRESENTATIONS AND WARRANTIES

 

Section 4.1 Representations and Warranties of Seller. Seller and Seller's Members represent and warrant to Buyer as follows:

 

(a) Seller is a limited liability company duly organized, validly existing and in good standing under the laws of the State of Colorado and has the requisite corporate power to carry on its business as it is now being conducted. Seller is duly qualified to do business, and is in good standing, in each jurisdiction in which the Assets owned, leased or operated by it makes such qualification necessary.

 

(b) Seller has all requisite power and authority to execute and deliver this Agreement and to perform its obligations under this Agreement. The execution, delivery and performance of this Agreement and the transactions contemplated hereby have been duly and validly authorized by all requisite corporate action on the part of Seller.

 

(c) This Agreement constitutes a valid and binding agreement of Seller enforceable against Seller in accordance with its terms, subject to: (i) applicable bankruptcy, insolvency, reorganization, moratorium and other similar laws of general application with respect to creditors; (ii) general principles of equity; and (iii) the power of a court to deny enforcement of remedies generally based upon public policy.

 

(d) Neither the execution and delivery of this Agreement nor the consummation of the transactions and performance of the terms and conditions contemplated hereby by Seller will: (i) conflict with or result in any breach of any provision of the articles of organization, operating agreement or other similar governing documents of Seller; (ii) conflict with, be rendered void or ineffective by or under the terms, conditions or provisions of any agreement, instrument or obligation to which Seller is a party or is subject or by which any of its properties or assets are bound; (iii) result in or give rise to (or with notice or the passage of time or both could result in or give rise to) a default, the creation or imposition of any lien, charge, penalty, restriction, security interest or encumbrance or any change in terms, termination, cancellation or acceleration under the terms, conditions or provisions of any Asset (or of any agreement, instrument or obligation relating to or burdening Seller or any Asset); or (iv) violate or be rendered void or ineffective under any Laws or result in or give rise to (or with notice or the passage of time or both could result in or give rise to) the creation or imposition of any lien, charge, penalty, restriction, security interest or encumbrance on or with respect to any Asset under any Law.

 

(e) Except for the Transfer Requirements expressly described and set forth in Schedule 4.1(e), none of the Assets or any portion thereof are subject to any Transfer Requirements. "Transfer Requirements" shall mean any consent, approval, authorization or permit of, or filing with or notification to, any Person which must be obtained, made or complied with for or in connection with the execution and delivery of this Agreement by Seller or any sale, assignment, transfer or encumbrance of any Asset or any interest therein in order (i) for such sale, assignment, transfer or encumbrance to

 

 

 

 

  

6

  

be effective, (ii) to prevent any termination, cancellation, default, acceleration or change in terms (or any right thereof from arising) under any terms, conditions or provisions of any Asset (or of any agreement, instrument or obligation relating to or burdening any Asset) as a result of such sale, assignment, transfer or encumbrance, or (iii) to prevent the creation or imposition of any lien, charge, penalty, restriction, security interest or encumbrance on or with respect to any Asset (or any right thereof from arising) as a result of such sale, assignment, transfer or encumbrance; excluding, however, from the definition of Transfer Requirements consents and approvals of assignments by any Governmental Authority (other than consents and approvals by any Governmental Authority in connection with the assignment of any lease from a city, county, state or federal government that is included in the Assets) that are customarily obtained after closing the transactions contemplated by this Agreement.

 

(f) There are no actions, suits, arbitrations, proceedings, investigations or claims pending or threatened relating to or affecting any of the Assets or the transactions contemplated by this Agreement.

 

(g) Seller has not received any notice of any violation or alleged violation (or of any fact or circumstance which with notice or the passage of time or both would constitute a violation) of any Laws (including any Environmental Laws) applicable to the Assets, and the Assets comply with all Laws (including any Environmental Laws).

 

(h) Schedule 2.1(d) sets forth a true and correct description of each Contract, agreement or similar arrangement which is included in the Assets or by which any of the Assets is bound. Seller is in compliance with all terms and provisions of all contracts or agreements included in or by which any of the Assets is subject. All such contracts and agreements are in full force and effect and, to the knowledge of Seller, there are no violations or breaches thereof or existing facts or circumstances which upon notice or the passage of time or both will constitute a violation or breach thereof by any other party thereto.

 

(i) Seller has Good and Marketable Title to the Assets;

 

(j) Neither Seller nor any Affiliate of Seller has incurred any obligation or entered into any agreement for any investment banking, brokerage or finder's fee or commission in respect of the transactions contemplated by this Agreement for which Buyer or any Affiliate of Buyer shall incur any liability. "Affiliate" shall mean, as to the Person specified, any Person controlling, controlled by or under common control with such specified Person. The concept of control, controlling or controlled as used in the aforesaid context means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of another, whether through the ownership of voting securities, by contract or otherwise.

 

(k) Seller has paid all Taxes on or relating to the Assets, which are currently due and payable as required by Law prior to delinquency. Seller is not a non­resident alien or foreign corporation (as those terms are defined in Internal Revenue Code of 1986, as amended, and any successor thereto, together with all regulations promulgated thereunder (together, the "Code").

 

 

 

 

  

7

  

 

     (l) There are no bankruptcy, reorganization or arrangement proceedings pending against, being contemplated by, or threatened against Seller.

 

(m) Seller is not an "investment company" or a company "controlled" by an "investment company" within the meaning of the Investment Company Act of 1940, as amended, or is otherwise subject to regulation under or the restrictions of such Act.

 

(n) All licenses, permits, certificates, orders, approvals and authorizations of Governmental Authority necessary for the ownership or operation of the Assets have been obtained and all such licenses, permits, certificates, orders, approvals and authorizations are in full force and effect and all fees and charges relating thereto have been paid.

 

(o) None of the Assets are subject to or are bound by any futures, hedge, swap, collar, put, call, option or other commodities contract or agreement.

 

(p) Seller has knowledge, skill and experience in financial, business and investment matters relating to the transactions contemplated by this Agreement and is capable of evaluating the merits and risks of such transactions. To the extent deemed necessary by Seller, Seller has retained, at its own expense, and relied upon, appropriate professional advice regarding the investment, tax and legal merits and consequences of its execution of this Agreement.

 

(q) To the best of Seller's knowledge, none of Seller's statements or representations in this Agreement contain any untrue statement of any fact or omit to state any fact necessary to be stated in order to make the statements or representations made not misleading.

 

(r) The Assets to be transferred under this Agreement constitute substantially of Seller's assets.

 

(s) The transactions contemplated in this Agreement have been undertaken by the Seller in good faith, considering its obligations to any person or entity to whom Seller owes a right to payment, and has undertaken these transactions without any intent to hinder, delay or defraud any of Seller's creditors. The Seller has not been sued or threatened with suit by any creditor prior to the execution of this Agreement and have not moved or concealed any assets from creditors. Seller believes in good faith that Seller will receive consideration reasonably equivalent to the value of the assets transferred under this Agreement.

 

(t) Seller is an "accredited investor" as that term is defined in Regulation D under the Securities Act.

 

Section 4.2 Representations and Warranties of Seller's Members. Seller's Members represent and warrant to Buyer as follows:

 

  

8

  

 

(a) Each Member of Seller is acquiring the Shares described in Subsection 3.1(b) for the Member's own account and for investment purposes only, and without the intention of reselling or redistributing the same.

 

(b) Each Member of Seller represents that he is an "accredited  investor" as that term is defined in Regulation D under the Securities Act.

 

(c) The Shares shall be subject to statutory resale restrictions under the securities laws. The Shares have not been and will not be registered under the Securities Act of 1933, as amended (the "Securities Act") and may not be offered or sold in the U.S. or to any U.S. Person, unless the Shares are registered under the Securities Act and all applicable state securities laws or an exemption from such registrations requirement is available. No representation has been made by or on behalf of Buyer as to the period of time during which Seller's Members will be required to hold the Shares prior to resale. Buyer is under no obligation to register the Shares or to take any other action to allow Seller's Members to sell the Shares.

 

(d) The certificates representing the Shares will bear a legend substantially in the following form:

 

THIS SECURITY HAS NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), IN RELIANCE UPON THE EXEMPTIONS FROM REGISTRATION PROVIDED IN THE ACT AND REGULATION D UNDER THE ACT AND HAVE NOT BEEN REGISTERED UNDER ANY STATE SECURITIES LAWS. THEREFORE, ANY SUBSEQUENT TRANSFER OF THIS SECURITY OR ANY INTEREST THEREIN WILL BE UNLAWFUL UNLESS IT IS REGISTERED UNDER THE ACT AND ANY STATE SECURITIES LAWS OR UNLESS AN EXEMPTION FROM REGISTRATION IS AVAILABLE. FURTHERMORE, IT IS UNLAWFUL TO CONSUMMATE A SALE OR TRANSFER OF THIS SECURITY OR ANY INTEREST THEREIN, WITHOUT THE OPINION OF COUNSEL ACCEPTABLE TO THE COMPANY THAT THE PROPOSED TRANSFER OR SALE DOES NOT AFFECT THE EXEMPTIONS RELIED UPON BY THE COMPANY IN ORIGINALLY DISTRIBUTING THE SECURITY AND THAT REGISTRATION IS NOT REQUIRED.

 

Section 4.3 Representations and Warranties of Buyer. Buyer represents and warrants to Seller as follows:

 

(a)          Buyer is a corporation duly organized, validly existing and in good

standing under the laws of the State of Colorado and has the requisite corporate power to carry on its business as it is now being conducted. Buyer is duly qualified to do business, and is in good standing, in each jurisdiction in which the Assets to be acquired by it makes such qualification necessary.

 

 

  

9

  

 

(b) Buyer has all requisite corporate power and authority to execute and deliver this Agreement and to perform its obligations under this Agreement. The execution, delivery and performance of this Agreement and the transactions contemplated hereby have been duly and validly authorized by all requisite corporate action on the part of Buyer.

 

(c) This Agreement constitutes a valid and binding agreement of Buyer enforceable against Buyer in accordance with its terms, subject to: (i) applicable bankruptcy, insolvency, reorganization, moratorium and other similar laws of general application with respect to creditors; (ii) general principles of equity; and (iii) the power of a court to deny enforcement of remedies generally based upon public policy.

 

(d) Neither the execution and delivery of this Agreement nor the consummation of the transactions and performance of the terms and conditions contemplated hereby by Buyer will (i) conflict with or result in any breach of any provision of the certificate of incorporation, bylaws and other similar governing documents of Buyer; (ii) be rendered void or ineffective by or under the terms, conditions or provisions of any agreement, instrument or obligation to which Buyer is a party or is subject; or (iii) violate or be rendered void or ineffective under any Law.

 

(e) No consent, approval, authorization or permit of, or filing with or notification to, any Person is required for or in connection with the execution and delivery of this Agreement by Buyer or for or in connection with the consummation of the transactions and performance of the terms and conditions contemplated hereby by Buyer.

 

(f) Neither Buyer nor any Affiliate of Buyer has incurred any obligation or entered into any agreement for any investment banking, brokerage or finder's fee or commission in respect of the transactions contemplated by this Agreement for which Seller or any Affiliate of Seller shall incur any liability.

 

ARTICLE V

COVENANTS OF SELLER AND BUYER

 

Section 5.1 General Conveyance. Upon the terms and subject to the conditions of this Agreement, at Closing, Seller shall execute and deliver the General Conveyance, in substantially the form attached hereto as Exhibit 5.1 (the "Conveyance"), to Buyer together with all assignment forms as may be required by Law to be executed in connection with the conveyance of specific Assets; provided that the terms and provisions of the Conveyance shall control as to any conflict between the Conveyance and any such special assignment forms.

 

Section 5.2 Public Announcements. Without the prior written approval of the other Party, which approval shall not be unreasonably withheld, no Party will issue, or permit any agent or Affiliate to issue, any press releases or otherwise make, or cause any agent or Affiliate to make, any public statements with respect to this Agreement and the transactions contemplated hereby, except where such release or statement is deemed in good faith by the releasing Party to be required by Law or any national

 

 

  

10

  

 

securities exchange, in which case the Party or Parties will use its or their, as the case may be, commercially reasonable efforts to provide a copy to the other Party prior to any release or statement.

 

Section 5.3 Further Assurances. Seller and Buyer each agree that, from time to time, whether before, at or after the Closing Date, each of them will execute and deliver or cause their respective Affiliates to execute and deliver such further instruments of conveyance and transfer and take such other action as may be necessary to carry out the purposes and intents of this Agreement. Any separate or additional assignment of the Assets or any portion thereof required pursuant to this Section 5.3: (a) shall evidence the conveyance and assignment of the Assets made or intended to be made in the Conveyance; (b) shall not modify or be deemed to modify any of the terms, covenants and conditions set forth in the Conveyance or in this Agreement; and (c) shall be deemed to contain all of the terms and provisions of the Conveyance, as fully as though the same were set forth at length in such separate or additional assignment.

 

Section 5.4 Negative Covenant. Between the date of this Agreement and the Closing Date, Seller shall not, without the prior written consent of Buyer, make any modification to any of the Assets or enter into any compromise or settlement of any litigation, proceeding or governmental investigation relating to the Assets. Notwithstanding the above, Seller shall be allowed to file and record any necessary documents which are required to cure title matters as set forth in Section 2.7 or as may be necessary to deliver the 8/8ths net revenue interests as listed in Schedules 2.1(a)(b) and as further set forth in Section 2.2(c).

 

ARTICLE VI

CLOSING

 

Section 6.1 Closing. Unless extended pursuant to the terms of this Agreement, the closing of this transaction shall be held on or before April 30, 2013 at 10:00 a.m. Colorado time, or such other mutually agreed upon date. The Closing may occur by fax or email as may be the case. The actual date on which the Closing occurs shall be known as the "Closing Date"). At Closing, the obligations in Section 6.2 and Section 6.3 shall occur, each being a condition precedent to the others and each being deemed to have occurred simultaneously with the other.

 

Section 6.2 Seller's Closing Obligations. At Closing, Seller shall execute and deliver, or cause to be executed and delivered, to Buyer the following:

 

(a) the Conveyance, Assignment and Bill of Sale in the form attached as Exhibit 5.1;

 

(b) an Affidavit of Non-foreign Status substantially in the form attached as Exhibit 6.2(b);

 

(c) the Records; and

 

 

  

11

  

 

 

(d)such other documents as may be reasonably necessary to convey

 

all of Seller's interests in the Assets to Buyer in accordance with the terms and provisions of this Agreement.

 

Section 6.3 Buyer's Closing Obligations. At Closing, Buyer shall:

 

(a) deliver, or cause to be delivered, the cash portion of the Purchase Price in immediately available funds; and

 

(b) deliver, or cause to be delivered, a duly authorized share certificate in the name of each of Seller's Members as provided in Article III of this Agreement (the "Share Certificates").

 

Section 6.4 Buyer's Conditions of Closing. Buyer's obligations under this Agreement are subject, at the option of Buyer, to the satisfaction at Closing of the following conditions:

 

(a) All representations and warranties of Seller and Seller's Members contained in this Agreement shall be true in all material respects at and as of the Closing as if such representations and warranties were made at and as of the Closing; and

 

(b) Seller shall have performed and satisfied all covenants required by this Agreement to be performed and satisfied by Seller at or prior to the Closing.

 

Should the above conditions not be satisfied to Buyer's satisfaction as of the Closing, Buyer may, as its sole and exclusive remedy, terminate this Agreement without further liability between the Buyer and Seller.

 

Section 6.5 Survival. The representations and warranties of the Parties and Seller's Members contained in Article IV of this Agreement shall survive for six (6) months after the Closing Date. All of the covenants and agreements made by each Party in this Agreement shall survive the consummation of the transactions contemplated herein and shall continue in full force and effect after the Closing indefinitely until all obligations with respect to any such covenants are fulfilled in their entirety.

 

ARTICLE VII

Termination and Confidentiality

 

Section 7.1 Right of Termination This Agreement may be terminated at any time at or prior to the Closing:

 

(a) by mutual written consent of the Parties;

 

(b) by Buyer on the Closing Date if the obligations set forth in Section 7.2 or the conditions set forth in Section 7.5 have not been

 

 

  

12

  

 

satisfied in all material respects or waived by Buyer in writing by the Closing Date;

 

(c) by Seller on the Closing Date if the obligations set forth in Section 7.3 or the conditions set forth in Section 7.4 have not been satisfied in all material respects or waived by Seller in writing by the Closing Date; or

 

(d) by either Buyer or Seller if the Closing has not occurred by April 30, 2013 unless agreed to by the Parties in writing.;

 

provided, however, that no Party shall have the right to terminate this Agreement pursuant to Sections 7.1(b), 7.1(c), or 7.1(d) if such Party is at such time in breach of any provision of this Agreement.

 

Section 7.2   Effect of Termination. In the event that the Closing does not

 

occur because a Party exercises its right to terminate this Agreement under Section 2.7 or Section 7.1, then except as set forth in Section 3.2, this Agreement shall be null and void and no Party shall have any further rights or obligations under this Agreement; provided that, nothing herein shall relieve any Party from any liability for any breach hereof. Further, upon the failure of Seller to meet a material condition to Closing set forth in Section 6.4, Buyer, at its sole discretion, may enforce whatever legal or equitable rights may be appropriate and applicable, including, without limitation specific performance of this Agreement.

 

Section 7.3   Confidentiality: The Parties agree that the amount of the

 

Purchase Price shall remain confidential. Notwithstanding the immediately preceding sentence, the Parties agree that the Purchase Price may be disclosed by the Parties to their affiliates and each of their respective officers, directors, employees, partners, attorneys, representatives, accountants, brokers, and lenders. In addition, the Purchase Price may be disclosed as required by discovery process, court order, law, rule or regulation of a governmental authority or stock exchange. The Parties recognize that the Conveyance will be filed in the public record and consent to such filing. Nothing in this Section 7.1 shall prevent either Party from disclosing the other provisions of this Agreement or the fact that the Parties have entered into this Agreement.

 

ARTICLE VIII

MISCELLANEOUS

 

Section 8.1 Counterparts. This Agreement may be executed in one or more counterparts, all of which shall be considered one and the same agreement, and shall become effective when one or more counterparts have been signed by each of the Parties and delivered to the other Party.

 

Section 8.2 Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF COLORADO WITHOUT REFERENCE TO THE CONFLICT OF LAW PRINCIPLES THEREOF.

 

 

 

  

13

  

 

Section 8.3   Entire Agreement. This Agreement (including the Exhibits, Schedules, and other agreements expressly contemplated by or incorporated herein) contains the entire agreement between the Parties with respect to the subject matter hereof and there are no agreements, understandings, representations or warranties between the Parties other than those set forth or referred to herein.

 

Section 8.4   Expenses. Buyer shall be responsible for all recording fees relating to the filing of instruments transferring title to Buyer from Seller. Seller shall be responsible for (a) all recording and other fees relating to title curative documents, (b) any sales Taxes which may become due and owing by reason of the sale of the Assets hereunder, (c) all transfer, stamp, documentary and similar Taxes imposed on the Parties with respect to the property transfer contemplated pursuant to this Agreement and (d) all income and other Taxes incurred by or imposed on Seller with respect to the transactions contemplated hereby. All other costs and expenses incurred by each Party in connection with all things required to be done by it hereunder, including attorney's fees, accountant fees and the expense of title examination, shall be borne by the Party incurring same.

 

Section 8.5   Notices. All notices hereunder shall be sufficiently given for all purposes hereunder if in writing and delivered personally, sent by documented overnight delivery service or, to the extent receipt is confirmed, by United States Mail, telecopy, telefax, email or other similar electronic transmission service to the appropriate address or number as set forth below. Notices to Seller shall be addressed as follows:

 

Premier Energy Partners (I) LLC

PO Box 2328

Littleton, CO 80161

Attn: Frederick J. Witsell

Email: fwitsellpremier@comcast.net

 

or at such other address and to the attention of such other Person as Seller may designate by written notice to Buyer. The party Seller designated above is authorized to receive any notice contemplated by this Agreement on behalf of all parties Seller and is also authorized to make any response or election required hereunder with respect to such notice on behalf of all parties Seller.

 

Notices to Buyer shall be addressed to:

 

PetroShare Corp.

7200 S. Alton Way, Suite B220

Centennial, Colorado 80111 

Attention: Stephen J. Foley 

Phone number: 303-591-1321 

Email: sfoley43@msn.com

 

 

  

14

  

or at such other address and to the attention of such other Person as Buyer may designate by written notice to Seller.

 

Section 8.6    Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the Parties and their respective successors and permitted assigns. Neither this Agreement nor the obligations of any Party shall be assignable or transferable by such Party without the prior written consent of the other Party, which consent shall not be unreasonably withheld.

 

Section 8.7    Headings. The headings to Articles, Sections and other subdivisions of this Agreement are inserted for convenience of reference only and will not affect the meaning or interpretation of this Agreement.

 

Section 8.8    Amendments and Waivers. This Agreement may not be modified or amended except by an instrument or instruments in writing signed by the Party against whom enforcement of any such modification or amendment is sought. Any Party may, only by an instrument in writing, waive compliance by another Party with any term or provision of this Agreement on the part of such other Party to be performed or complied with. The waiver by any Party of a breach of any term or provision of this Agreement shall not be construed as a waiver of any subsequent breach.

 

Section 8.9    Exhibits and Schedules. The Exhibits and Schedules hereto which are referred to herein are hereby made a part hereof and incorporated herein by such reference.

 

Section 8.10 Purchase Price Allocation for Tax Purposes. Seller and Buyer agree that the Purchase Price shall be allocated to the various Assets for federal and state income tax purposes as shown on Exhibit 8.10. The Parties further agree that the allocations set forth on Exhibit 8.10 represent reasonable estimates of the fair market values of the Assets described therein.

 

Section 8.11 Agreement for the Parties' Benefit Only. Except as specified in Article VII, this Agreement is not intended to confer upon any Person not a Party any rights or remedies hereunder, and no Person, other than the Parties, is entitled to rely on any representation, warranty, covenant or agreement contained herein.

 

Section 8.12 Severability. If any term or other provision of this Agreement is invalid, illegal or incapable of being enforced by any rule of law or public policy, all other conditions and provisions of this Agreement shall nevertheless remain in full force and effect so long as the economic or legal substance of the transactions contemplated hereby is not affected in any adverse manner to any Party. Upon such determination that any term or other provision is invalid, illegal or incapable of being enforced, the Parties shall negotiate in good faith to modify this Agreement so as to effect the original intent of the Parties as closely as possible in an acceptable manner to the end that the transactions contemplated hereby are fulfilled to the extent possible.

 

Section 8.13 Limitation of Damages. NOTWITHSTANDING ANYTHING CONTAINED HEREIN TO THE CONTRARY, IN NO EVENT SHALL ANY PARTY

 

  

15

  

 

AND/OR ITS AFFILIATES BE LIABLE FOR ANY CONSEQUENTIAL, SPECIAL, INDIRECT OR PUNITIVE DAMAGES CLAIMED BY A PARTY ARISING FROM OR RELATING TO ANY ACTIONS FOR ANY BREACH OR ALLEGED BREACH OF THIS AGREEMENT.

 

[Signatures on Following Page]

 

 

 

 

  

16

  

IN WITNESS WHEREOF, this Agreement has been signed by or on behalf of each of the Parties and Seller's Members as of the day first above written.

 

BUYER:

 

PetroShare Corp.

 

 

   

By:           /s/ Stephen J. Foley

Name:     Stephen J. Foley

Title:       Chief Executive Officer

 

SELLER:

 

Premier Energy Partners (I) LLC

 

   

By:    /s/ Frederick J. Witsell

Name:     Frederick J. Witsell

Title:       Managing Member

 

MEMBERS:

 

 

/s/ Fred J. Witsell

Fred J. Witsell

 

 

/s/ John H. Carpenter

John H. Carpenter

 

 

/s/ David L. Witsell

David L. Witsell

 

 

/s/ Kyle A. Worsham

Kyle A. Worsham

 

 

 

  

17

  

 

SCHEDULE 2.1(a) with Lease Valuation Summary

 

Assignment of Leases dated April ___, 2013

 

	  	  	  	  	  	  	  	  	  	  
	  	  	  	  	  	  	  	  	  	  
	
LESSOR

	
LESSEE

	
DESCRIPTION

	
EFFECTIVE DATE

	
EXPIRATION DATE

	
GROSS ACRES

	
NET ACRES

	
NET ACRES CONVEYED

	
NET REVENUE INTEREST

	
RECORDING

	  	  	  	  	  	  	  	
2.70%

	
to be delivered 8/8ths

	 
	
Richard J. Colby

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M.

Sec 21: Lots 11,14,15 & 16

Sec 22: Lots 12 & 13

Sec 27: Lots 3 & 4

Sec 28: Lot 1

	
11/20/2010

	
11/19/2015

5 yr lease, 

3 yr ext (2018)

	
369.39

	
15.40

	
0.42

	
80.00%

	
20103284

	
David Colby

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M.

Sec 21: Lots 11,14,15 & 16  

Sec 22: Lots 12 & 13 

Sec 27: Lots 3 & 4 

Sec 28: Lot 1

	
11/20/2010

	
11/19/2015

5 yr lease, 

3 yr ext (2013)

	
369.39

	
15.40

	
0.42

	
80.00%

	
20103286

	
Douglas Van Tassel, Diana Lynn Hamilton, Donna Lee Sweet, DeLaine Brown and Debbie Lou Van Tassel, 

PO Box 335, 

Craig, CO  81626-0335

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M.

Sec 35: Lots 4 & 5  

Sec 34: Lots 1,7,8,9,10,11,12,13,14,15,16

	
1/10/2011

	
1/09/2014

3 yr lease, 

3 yr ext (2017)

	
534.62

	
89.10

	
2.41

	
80.00%

	
20103146

	
Florence Van Tassel

	
Laramie & Associates

	
T6N-R90W, 6th P.M.

Sec 35: Lots 4 & 5    

Sec 34: Lots 1,7,8,9,10,11,12,13,14,15,16

	
1/10/2011

	
1/09/2016

5 yr lease, 

3 yr ext (2019)

	
534.62

	
89.10

	
2.41

	
80.00%

	
20103022

	
Gregory J. Knez, Trustee of the Raymond M. & Hellen M. Knez Family Trust

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M.

Sec 19: Lots 5, 6, 11 & 12 

Sec 20: N2 less tract (see lease)

	
3/21/2011

	
3/20/2016

5 yr lease, 

3 yr ext (2019)

	
270.31

	
271.07

	
7.32

	
80.00%

	
20103026

	
Gregory J. Knez, Trustee of the Raymond M. & Hellen M. Knez Family Trust

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M.   

Sec 20: A tract in E 55 acres of E2NEN2 (see lease)

	
3/21/2011

	
3/20/2016

5 yr lease, 

3 yr ext (2019)

	
11.45

	
11.45

	
0.31

	
80.00%

	
20103024

	
Marlene Henderson

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M.  

Sec 21: Lots 11,14,15 & 16

Sec 22: Lots 12 & 13  

Sec 27: Lots 3 & 4    

Sec 28: Lot 1

	
3/30/2011

	
3/29/2016

5 yr lease, 

3 yr ext (2019)

	
369.39

	
15.40

	
0.42

	
80.00%

	
20102819

	
Barbara Martin

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M.

Sec 21: Lots 11,14,15 & 16  

Sec 22: Lots 12 & 13 

Sec 27: Lots 3 & 4   

Sec 28: Lot 1

	
3/30/2011

	
3/29/2016

5 yr lease, 

3 yr ext (2019)

	
369.39

	
15.40

	
0.42

	
80.00%

	
20102820

	
Edward Rutherford

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M. 

Sec 21: Lots 11,14,15 & 16  

Sec 22: Lots 12 & 13    

Sec 27: Lots 3 & 4 

Sec 28: Lot 1

	
3/30/2011

	
3/29/2016

5 yr lease, 

3 yr ext (2019)

	
369.39

	
15.40

	
0.42

	
80.00%

	
20102821

 

 

 

  

  

  

 

	
Larry Rutherford

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M. 

Sec 21: Lots 11,14,15 & 16  

Sec 22: Lots 12 & 13   

Sec 27: Lots 3 & 4    

Sec 28: Lot 1

	
3/30/2011

	
3/29/2016

5 yr lease, 

3 yr ext (2019)

	
369.39

	
15.40

	
0.42

	
80.00%

	
20102822

	
Mark A Voloshin

	
Buck Peak, LLC

	
T5N-R90W, 6th P.M.  

Sec 2: Lots 7, 8, 9, 10 less tract (see lease)

Sec 2: 15,16,17,18

	
5/12/2011

	
5/11/2016

5 yr lease, no ext

	
333.57

	
15.41

	
0.42

	
80.00%

	
20103150

	
Mark A Voloshin

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M.

Assesor's Tract # 69  

Sec 21: Lots 3, 6, 7 & 10

	
5/12/2011

	
5/11/2016

5 yr lease, no ext

	
164.88

	
47.11

	
1.27

	
80.00%

	
20103151

	
Mark A Voloshin

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M. 

Assessor's Tract # 70 

Sec 21: Lots 4 & 5

	
5/12/2011

	
5/11/2016

5 yr lease, no ext

	
82.44

	
24.43

	
0.66

	
80.00%

	
20103152

	
Mark A Voloshin

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M. 

Assessors Tract # 83 

Sec 27: Lots 5,6,10,11,12,14,15,16 

Sec 34: Lots 2,3 

less the acreage in Sec 35 and the additional lands in Sec 34

	
5/12/2011

	
5/11/2016

5 yr lease, 

2 yr ext (2018)

	
409.65

	
100.52

	
2.71

	
80.00%

	
20103155

	
Mark A Voloshin

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M. 

Assessor's Tract # 105

Sec 21: Lots 1,2,8 & 9

	
5/12/2011

	
5/11/2016

5 yr lease, 

2 yr ext (2018)

	
164.97

	
80.96

	
2.19

	
80.00%

	
20103156

	
Mark A Voloshin

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M.

Assessors Tract #82       

Sec 26: Lots 4,5,6,11,12,13 & 14  

Sec 27:Lots 1,2,5,6,7,8,9,10,11,12,14,15,16

	
5/12/2011

	
5/11/2016

5 yr lease, no ext

	
330.85

	
162.36

	
4.38

	
80.00%

	
20103154

	
Betty Arnone

	
Buck Peak, LLC

	
T5N-R90W, 6th P.M.  

Sec 2: Lots 7,8,9,10 Less Tract (see lease)    

Sec 2: 15,16,17 & 18

	
5/12/2011

	
5/11/2016

5 yr lease, 

2 yr ext (2018)

	
333.57

	
11.56

	
0.31

	
80.00%

	
20102829

	
Betty Arnone

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M.      

Assessor's Tract # 69  

Sec 21: Lots 3, 6, 7, & 10

	
5/12/2011

	
5/11/2016

5 yr lease, no ext

	
164.88

	
17.59

	
0.47

	
80.00%

	
20102830

	
Betty Arnone

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M.      

Assessor's Tract # 70   

Sec 21: Lots 4 & 5

	
5/12/2011

	
5/11/2016

5 yr lease, no ext

	
82.44

	
9.16

	
0.25

	
80.00%

	
20102831

 

 

  

  

  

	  	  	  	  	  	  	  	  	  	  
	
Betty Arnone

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M.      

Assessor's Tract # 82   

Sec 26: Lots 11, 12, 13, 14 

Sec 27: Lots 2, 7, 8, 9

	
5/12/2011

	
5/11/2016

5 yr lease, no ext

	
330.85

	
26.04

	
0.70

	
80.00%

	
20102833

	
Betty Arnone

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M.      

Assessor's Tract # 83   

Sec 27: Lots 5,6,10,11,12,14,15,16     

Sec 34: Lots 2,3 Less acreage (see lease)

	
5/12/2011

	
5/11/2016

5 yr lease, no ext

	
409.65

	
16.12

	
0.44

	
80.00%

	
20102834

	
Betty Arnone

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M.      

Assessor's Tract # 105 

Sec 21: Lots 1, 2, 8 & 9

	
5/12/2011

	
5/11/2016

5 yr lease, no ext

	
164.97

	
12.98

	
0.35

	
80.00%

	
20102835

	
Betty Jo Lott & Michelle K. McKee

	
Buck Peak, LLC

	
T5N-R90W, 6th P.M.  

Sec 2: Lots 7,8,9,10 less tract (see lease)   

Sec 2: 15,16,17,18

	
5/12/2011

	
5/11/2016

5 yr lease, no ext

	
333.57

	
11.56

	
0.31

	
80.00%

	
20102836

	
Betty Jo Lott & Michelle K. McKee

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M.   

Assessor's Tract # 69   

Sec 21: Lots 3, 6, 7, & 10

	
5/12/2011

	
5/11/2016

5 yr lease, no ext

	
164.88

	
17.6

	
0.48

	
80.00%

	
20102837

	
Betty Jo Lott & Michelle K. McKee

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M.      

Assessor's Tract # 70   

Sec 21: Lots 4 & 5

	
5/12/2011

	
5/11/2016

5 yr lease, no ext

	
82.44

	
9.16

	
0.25

	
80.00%

	
20102838

	
Betty Jo Lott & Michelle K. McKee

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M.       

Assessor's Tract # 82   

Sec 26: Lots 11, 12, 13, & 14  

Sec 27: Lots 2, 7, 8 & 9

	
5/12/2011

	
5/11/2016

5 yr lease, no ext

	
330.85

	
26.04

	
0.70

	
80.00%

	
20102840

	
Betty Jo Lott & Michelle K. McKee

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M.      

Assessor's Tract # 83   

Sec 27: Lots 5, 6, 10, 11, 12, 14, 15 & 16  

Sec 34: Lots 2, 3 Less acreage (see lease)

	
5/12/2011

	
5/11/2016

5 yr lease, no ext

	
409.65

	
16.12

	
0.44

	
80.00%

	
20102841

	
Betty Jo Lott & Michelle K. McKee

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M.      

Assessor's Tract # 105 

Sec 21: Lots 1, 2, 8 & 9

	
5/12/2011

	
5/11/2016

5 yr lease, no ext

	
164.97

	
12.98

	
0.35

	
80.00%

	
20102842

	
Gary R Semro and Robert W. Semro,

 6522 Trailhead Rd, 

Highlands Ranch, CO  80130

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M.       

Assessor's Tract # 69     

Sec 21: Lots 3, 6, 7, & 10

	
5/12/2011

	
5/11/2016

5 yr lease, no ext

	
164.88

	
17.59

	
0.47

	
80.00%

	
20102845

	
Gary R Semro and Robert W. Semro

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M.       

Assessor's Tract # 70   

Sec 21: Lots 4 & 5

	
5/12/2011

	
5/11/2016

5 yr lease, no ext

	
82.44

	
9.16

	
0.25

	
80.00%

	
20102846

 

 

  

  

  

	  	  	  	  	  	  	  	  	  	  
	
Gary R Semro and Robert W. Semro

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M.   

Assessor's Tract # 82   

Sec 26: Lots 11, 12, 13, & 14  

Sec 27: Lots 2, 7, 8 & 9

	
5/12/2011

	
5/11/2016

5 yr lease, no ext

	
330.85

	
26.04

	
0.70

	
80.00%

	
20102848

	
Gary R Semro and Robert W. Semro

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M.    

Assessor's Tract # 83   

Sec 27: Lots 5, 6, 10, 11, 12, 14, 15 & 16 

Sec 34: Lots 2, 3 Less acreage (see lease)

	
5/12/2011

	
5/11/2016

5 yr lease, no ext

	
409.65

	
16.12

	
0.44

	
80.00%

	
20102849

	
Gary R Semro and Robert W. Semro

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M.      

Assessor's Tract # 105     

Sec 21: Lots 1, 2, 8 & 9

	
5/12/2011

	
5/11/2016

5 yr lease, no ext

	
164.97

	
12.98

	
0.35

	
80.00%

	
20102844

	
Gary R Semro and Robert W. Semro

	
Buck Peak, LLC

	
T5N-R90W, 6th P.M.  

Sec 2: Lots 7,8,9,10 Less Tract (see lease)   

Sec 2: 15,16,17 & 18

	
5/12/2011

	
5/11/2016

5 yr lease, no ext

	
333.57

	
11.56

	
0.31

	
80.00%

	
20102843

	
Sharon A. Fitzgerald

	
Buck Peak, LLC

	
T5N-R90W, 6th P.M.  

Sec 2: Lots 7, 8, 9, 10 less tract (see lease)   

Sec 2: 15,16,17,18

	
5/12/2011

	
5/11/2016

5 yr lease, no ext

	
333.57

	
11.56

	
0.31

	
80.00%

	
20103144

	
Sharon A. Fitzgerald

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M.      

Assesor's Tract # 69    

Sec 21: Lots 3, 6, 7 & 10

	
5/12/2011

	
5/11/2016

5 yr lease, no ext

	
164.88

	
17.59

	
0.47

	
80.00%

	
20103138

	
Sharon A. Fitzgerald

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M.       

Assessor's Tract # 70   

Sec 21: Lots 4 & 5

	
5/12/2011

	
5/11/2016

5 yr lease, no ext

	
82.44

	
9.16

	
0.25

	
80.00%

	
20103139

	
Sharon A. Fitzgerald

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M.      

Assessor's Tract # 82        

Sec 26: Lots 11, 12, 13, & 14       

Sec 27: Lots 2, 7, 8 & 9

	
5/12/2011

	
5/11/2016

5 yr lease, no ext

	
330.85

	
26.04

	
0.70

	
80.00%

	
20103141

	
Sharon A. Fitzgerald

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M.   

Assessors Tract # 83    

Sec 27: Lots 5,6,10,11,12,14,15,16  

Sec 34: Lots 2,3 less acreage 

Sec 35, (see lease)

	
5/12/2011

	
5/11/2016

5 yr lease, no ext

	
409.65

	
16.12

	
0.44

	
80.00%

	
20103142

	
Sharon A. Fitzgerald

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M.      

Assessor's Tract # 105      

Sec 21: Lots 1,2,8 & 9

	
5/12/2011

	
5/11/2016

5 yr lease, no ext

	
164.97

	
12.98

	
0.35

	
80.00%

	
20103143

 

  

  

  

 

	
Eugena Grace Voloshin

	
Buck Peak, LLC

	
T6N-R103W, 6th P.M.

Sec 31: Lots 7,8,9, NESW, SE 

T6N-R90W, 6th P.M.       

Sec 14: Lots 3, 4, 6  

T6N-R91W, 6th P.M.     

Sec 9: Lots 8, 9, 16       

Sec 10: Lots 4, 5     

T6N-R92W, 6th P.M.      

Sec 13: SW     

T6N-R93W, 6th P.M.   

Sec 13: S2N2, N2S2    

T6N-R94W, 6th P.M.     

Sec 12: E2SE   

T6N-R99W, 6th P.M.      

Sec 27: SWSE, SESW    

Sec 34: NENW

	
5/12/2011

	
5/11/2016

5 yr lease, no ext

	
1320.3

	
18.748

	
0.51

	
80.00%

	
20102850

	
Eugena Grace Voloshin

	
Buck Peak, LLC

	
T10N-R90W, 6th P.M.    

Sec 19: Lot 18     

Sec 30: Lots 6 & 8

	
5/12/2011

	
5/11/2016

5 yr lease, no ext

	
117.16

	
1.663

	
0.04

	
80.00%

	
20102851

	
Eugena Grace Voloshin

	
Buck Peak, LLC

	
T3N-R91W, 6th P.M.  

Sec 8: Lots 9 & 16        

Sec 9: SW/4SW/4       

Sec 16: NW/4, NE/4SW/4

	
5/12/2011

	
5/11/2016

5 yr lease, no ext

	
323.43

	
4.593

	
0.12

	
80.00%

	
20102852

	
Eugena Grace Voloshin

	
Buck Peak, LLC

	
T4N-R91W, 6th P.M.      

Sec 10: Tract in SESW   (0.42 acres)     

T4N-R92W, 6th P.M.      

Sec 7: Lots 9 & 10        

Sec 8: Lots 5, 9, 10, 11, 12, 13, 14   

Sec 17: Lot 2      

T4N-R101W, 6th P.M.    

Sec 14: W2NE, NW, N2SW     

T4N-R102W, 6th P.M.    

Sec 27: SE     Sec 34: NE

	
5/12/2011

	
5/11/2016

5 yr lease, no ext

	
799.7

	
11.356

	
0.31

	
80.00%

	
20102853

	
Eugena Grace Voloshin

	
Buck Peak, LLC

	
T5N-R94W, 6th P.M.      

Sec 7: S2SE   Sec 8: SW     

Sec 17: N2NW  Sec 18: NENE  

T5N-R94W, 6th P.M.      

Sec 9: SWNE, NWSE, S2SE      

T5N-R97W, 6th P.M.     

Sec 3: N2SE, SWSE, E2SW   

Sec 10: N2NE, NENW

	
5/12/2011

	
5/11/2016

5 yr lease, no ext

	
840

	
11.93

	
0.32

	
80.00%

	
20102854

	
Eugena Grace Voloshin

	
Buck Peak, LLC

	
T5N-R90W, 6th P.M.      

Sec 2: Lots 7, 8, 9, 10 less tract (see lease)  

Sec 2: 15,16,17,18

	
5/12/2011

	
5/11/2016

5 yr lease, no ext

	
333.57

	
71.30

	
1.93

	
80.00%

	
20102855

	
Eugena Grace Voloshin

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M.  A

ssesor's Tract # 69    

Sec 21: Lots 3, 6, 7 & 10

	
5/12/2011

	
5/11/2016

5 yr lease, no ext

	
164.88

	
0.73

	
0.02

	
80.00%

	
20102857

	
Eugena Grace Voloshin

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M.   

Assessor's Tract # 105     

Sec 21: Lots 1,2,8 & 9

	
5/12/2011

	
5/11/2016

5 yr lease, no ext

	
164.97

	
0.76

	
0.02

	
80.00%

	
20102858

	
Eugena Grace Voloshin

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M.    

Assessor's Tract # 83       

Sec 27: Lots 5, 6, 10, 11, 12, 14, 15 & 16       

Sec 34: Lots 2, 3 Less acreage (see lease)

	
5/12/2011

	
5/11/2016

5 yr lease, no ext

	
409.65

	
0.95

	
0.03

	
80.00%

	
20102859

	
Eugena Grace Voloshin

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M. 

Assessor's Tract # 82       

Sec 26: Lots 11, 12, 13, & 14      

Sec 27: Lots 2, 7, 8 & 9

	
5/12/2011

	
5/11/2016

5 yr lease, no ext

	
330.85

	
1.53

	
0.04

	
80.00%

	
20102860

	
Eugena Grace Voloshin

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M. Assessor's Tract # 70 Sec 21: Lots 4 & 5

	
5/12/2011

	
5/11/2016

5 yr lease, no ext

	
82.44

	
0.38

	
0.01

	
80.00%

	
20102861

 

  

  

  

 

	
R. Kirk Lyons

	
Buck Peak, LLC

	
T5N-R89W, 6th P.M.      

Sec 6: Lots 3, 5 SE4NW4   

T6N-R89W, 6th P.M.       

Sec 29: Lot 13  

Sec 31: Lot 3,5,6,11 SW4NE4, NW4SE4, NE4SW4, SE4SW4    

Sec 32: Lot 4

	
6/1/2011

	
5/31/2014

3 yr lease, 

2 yr ext (2016)

	
425.23

	
47.24

	
1.28

	
80.00%

	
701711

	
Ralph C. Lyons & Anna M. Lyons

	
Buck Peak, LLC

	
T5N-R89W, 6th P.M.     

Sec 6: Lots 3, 5 SE4NW4       

T6N-R89W, 6th P.M.       

Sec 29: Lot 13 

Sec 31: Lot 3,5,6,11 SW4NE4, NW4SE4, NE4SW4, SE4SW4     

Sec 32: Lot 4

	
6/1/2011

	
5/31/2014

3 yr lease, 

2 yr ext (2016)

	
425.23

	
141.74

	
3.83

	
80.00%

	
701713

	
Leora L. Smith

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M.      

Sec 12: Lots 5,6,8,9,10,13,14,15     

Sec 24: Lots 1,2,7,8,9,10,14,15,16

	
6/1/2011

	
5/31/2014

3 yr lease, 

2 yr ext (2016)

	
673.54

	
154.304

	
4.17

	
80.00%

	
20102588

	
R. Kirk Lyons

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M.     

Sec 12: Lots 5,6,8,9,10,13,14,15    

Sec 24: Lots 1,2,7,8,9,10,14,15,16

	
6/1/2011

	
5/31/2014

3 yr lease, 

2 yr ext (2016)

	
673.54

	
51.43

	
1.39

	
80.00%

	
20102589

	
Ralph C. Lyons & Anna M. Lyons

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M.       

Sec 12: Lots 5,6,8,9,10,13,14,15    

Sec 24: Lots 1,2,7,8,9,10,14,15,16

	
6/1/2011

	
5/31/2014

3 yr lease, 

2 yr ext (2016)

	
673.54

	
154.30

	
4.17

	
80.00%

	
20102587

	
Mark E. Lyons

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M.    

Sec 12: Lots 5,6,8,9,10,13,14,15    

Sec 24: Lots 1,2,7,8,9,10,14,15,16

	
6/1/2011

	
5/31/2014

3 yr lease, 

2 yr ext (2016)

	
673.54

	
51.43

	
1.39

	
80.00%

	
20102586

	
Terri Lee Smedra

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M.        

Sec 12: Lots 5,6,8,9,10,13,14,15   

Sec 24: Lots 1,2,7,8,9,10,14,15,16

	
6/1/2011

	
5/31/2014

3 yr lease, 

2 yr ext (2016)

	
673.54

	
51.43

	
1.39

	
80.00%

	
20102585

	
Leora L. Smith

	
Buck Peak, LLC

	
T5N-R89W, 6th P.M.        

Sec 6: Lots 3, 5 SE4NW4    

T6N-R89W, 6th P.M.      

Sec 29: Lot 3     

Sec 31: Lot 3,5,6,11 SW4NE4,NW4SE4,   NE4SW4, SE4SW4   

Sec 32: Lot 4

	
6/1/2011

	
5/31/2014

3 yr lease, 

2 yr ext (2016)

	
425.23

	
141.72

	
3.83

	
80.00%

	
701715

	
Terri Lee Smedra

	
Buck Peak, LLC

	
T5N-R89W, 6th P.M.      

Sec 6: Lots 3, 5 SE4NW4   

T6N-R89W, 6th P.M.     

Sec 29: Lot 3    

Sec 31: Lot 3,5,6,11 SW4NE4, NW4SE4, NE4SW4, SE4SW4    

Sec 32: Lot 4

	
6/1/2011

	
5/31/2014

3 yr lease, 

2 yr ext (2016)

	
425.23

	
47.24

	
1.28

	
80.00%

	
701712

	
Mark E. Lyons

	
Buck Peak, LLC

	
T5N-R89W, 6th P.M.      

Sec 6: Lots 3, 5 SE4NW4   T6N-R89W, 6th P.M.      

Sec 29: Lot 13    

Sec 31: Lot 3,5,6,11 SW4NE4, NW4SE4, NE4SW4, SE4SW4    

Sec 32: Lot 4

	
6/1/2011

	
5/31/2014

3 yr lease, 

2 yr ext (2016)

	
425.23

	
51.43

	
1.39

	
80.00%

	
701714

 

  

  

  

 

	
Thomas J. Knez

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M.      

Sec 21: Lot 16     

Sec 22: Lots 12 & 13

	
7/10/2011

	
7/09/2016

5 yr lease, 

3 yr ext (2019)

	
122.97

	
20.50

	
0.55

	
80.00%

	
20102823

	
Helen P. Knez

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M.    

Sec 27: Lots 3 & 4      

Sec 28: Lot 1

	
7/17/2011

	
7/16/2016

5 yr lease, 

3 yr ext (2019)

	
122.93

	
20.5

	
0.55

	
80.00%

	
20103517

	
Gregory J. Knez, Trustee of the Raymond M. & Hellen M. Knez Family Trust

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M.   

Sec 21: Lots 11, 14, 15 & 16    

Sec 22: Lots 12 & 13        

Sec 27: Lots 3 & 4      

Sec 28: Lot 1

	
3/21/2011

	
3/20/2016

5 yr lease, 

3 yr ext (2019)

	
369.39

	
61.58

	
1.66

	
80.00%

	
20103025

	
Kathy Peters

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M.      

Sec 35: Lots 9,10 11,12,13,14,15,16 (S/2)

	
7/31/2011

	
7/30/2014

3 yr lease, 

3 yr ext (2017)

	
331.00

	
110.56

	
2.99

	
80.00%

	
20103518

	
Barbara L. Wilaby

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M.    

Sec 12: Lots1,2,3,5,6,7,8,9,10,12,13,14,15

	
10/31/2008   

3 years + 2 year ext option

	
10/30/2013

	
493.56

	
208.12

	
5.62

	
80.00%

	
20090483

	
Barbara L. Wilaby

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M.    

Sec 13: Lots 2,3,4, less tract

	
10/31/2008   

3 years + 2 year ext option

	
10/30/2013

	
130.10

	
30.23

	
0.82

	
80.00%

	
20090484

	
Rex Ross Walker

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M.    

Sec 34: Lots 1, 7,8,9,10,11,12,13,14,15,16

	
12/18/2008  

3 years + 2 year ext option

	
12/17/2013

	
351.36

	
26.24

	
0.71

	
80.00%

	
20090151

	  	  	  	  	
EXTENDED

	  	  	
76.99

	  	  
	
Margaret Keith

	
Buck Peak, LLC

	
T5N-R90W, 6th P.M.      

Sec 2: Lots 7,8,9,10 less tract (see lease)   

Sec 2: 15,16,17,18

	
9/30/2008     

5 years + 3 year ext option

	
9/29/2013

	
333.57

	
11.560

	
0.31

	
80.00%

	
20084242

	
Margaret Keith

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M. 

Assessor's Tract # 105   

Sec 21: Lots 1, 2, 8, and 9

	
9/30/2008  

5 years + 3 year ext option

	
9/29/2013

	
164.97

	
12.98

	
0.35

	
80.00%

	
20084243

	
Margaret Keith

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M.    

Assessor's Tract # 83       

Sec 27: Lots 5, 6, 10, 11, 12, 14, 15 & 16       

Sec 34: Lots 2, 3 Less acreage (see lease)

	
9/30/2008    

5 years + 3 year ext option

	
9/29/2013

	
409.65

	
16.12

	
0.44

	
80.00%

	
20084244

	
Margaret Keith

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M. 

Assessor's Tract # 82      

Sec 26: Lots 11, 12, 13, & 14      

Sec 27: Lots 2, 7, 8 & 9

	
9/30/2008   

5 years + 3 year ext option

	
9/29/2013

	
330.85

	
26.04

	
0.70

	
80.00%

	
20084245

 

 

  

  

  

 

	
Margaret Keith

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M. 

Assessor's Tract # 70   

Sec 21: Lots 4 & 5

	
9/30/2008     

5 years + 3 year ext option

	
9/29/2013

	
82.44

	
9.16

	
0.25

	
80.00%

	
20084246

	
Margaret Keith

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M.  

Assesor's Tract # 69    

Sec 21: Lots 3, 6, 7 & 10

	
9/30/2008    

5 years + 3 year ext option

	
9/29/2013

	
164.88

	
17.59

	
0.47

	
80.00%

	
20084247

	
James W. Keith

	
Buck Peak, LLC

	
T5N-R90W, 6th P.M.      

Sec 2: Lots 7,8,9,10 less tract (see lease)   

Sec 2: 15,16,17,18

	
9/30/2008    

5 years + 3 year ext option

	
9/29/2013

	
333.57

	
3.86

	
0.10

	
80.00%

	
20084241

	
James W. Keith

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M. 

Assessor's Tract # 105   

Sec 21: Lots 1, 2, 8, and 9

	
9/30/2008 - 2013    

5 years + 3 year ext option

	
9/29/2013

	
164.97

	
4.33

	
0.12

	
80.00%

	
20084240

	
James W. Keith

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M.    

Assessor's Tract # 83       

Sec 27: Lots 5, 6, 10, 11, 12, 14, 15 & 16       

Sec 34: Lots 2, 3 Less acreage (see lease)

	
9/30/2008   

5 years + 3 year ext option

	
9/29/2013

	
409.65

	
5.37

	
0.15

	
80.00%

	
20084239

	
James W. Keith

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M. 

Assessor's Tract # 82       

Sec 26: Lots 11, 12, 13, & 14      

Sec 27: Lots 2, 7, 8 & 9

	
9/30/2008  

 5 years + 3 year ext option

	
9/29/2013

	
330.85

	
8.68

	
0.23

	
80.00%

	
20084238

	
James W. Keith

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M. 

Assessor's Tract # 70   

Sec 21: Lots 4 & 5

	
9/30/2008   

5 years + 3 year ext option

	
9/29/2013

	
82.44

	
3.05

	
0.08

	
80.00%

	
20084237

	
James W. Keith

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M.  

Assesor's Tract # 69    

Sec 21: Lots 3, 6, 7 & 10

	
9/30/2008  

5 years + 3 year ext option

	
9/29/2013

	
164.88

	
5.86

	
0.16

	
80.00%

	
20084236

	
Charles S. Keith

	
Buck Peak, LLC

	
T5N-R90W, 6th P.M.      

Sec 2: Lots 7,8,9,10 less tract (see lease)   

Sec 2: 15,16,17,18

	
9/30/2008     

5 years + 3 year ext option

	
9/29/2013

	
333.57

	
3.86

	
0.10

	
80.00%

	
20084235

	
Charles S. Keith

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M. 

Assessor's Tract # 105   

Sec 21: Lots 1, 2, 8, and 9

	
9/30/2008 

 5 years + 3 year ext option

	
9/29/2013

	
164.97

	
4.33

	
0.12

	
80.00%

	
20084234

	
Charles S. Keith

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M.    

Assessor's Tract # 83       

Sec 27: Lots 5, 6, 10, 11, 12, 14, 15 & 16       

Sec 34: Lots 2, 3 Less acreage (see lease)

	
9/30/2008    

5 years + 3 year ext option

	
9/29/2013

	
409.65

	
5.37

	
0.15

	
80.00%

	
20084233

 

  

  

  

 

	
Charles S. Keith

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M. 

Assessor's Tract # 82       

Sec 26: Lots 11, 12, 13, & 14      

Sec 27: Lots 2, 7, 8 & 9

	
9/30/2008  

5 years + 3 year ext option

	
9/29/2013

	
330.85

	
8.68

	
0.23

	
80.00%

	
20084232

	
Charles S. Keith

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M. 

Assessor's Tract # 70   

Sec 21: Lots 4 & 5

	
9/30/2008     

5 years + 3 year ext option

	
9/29/2013

	
82.44

	
3.05

	
0.08

	
80.00%

	
20084231

	
Charles S. Keith

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M.  

Assesor's Tract # 69    

Sec 21: Lots 3, 6, 7 & 10

	
9/30/2008    

5 years + 3 year ext option

	
9/29/2013

	
164.88

	
5.86

	
0.16

	
80.00%

	
20084230

	
Debra A Ziehm

	
Buck Peak, LLC

	
T5N-R90W, 6th P.M.      

Sec 2: Lots 7,8,9,10 less tract (see lease)  

Sec 2: 15,16,17,18

	
9/30/2008    5 years + 3 year ext option

	
9/29/2013

	
333.57

	
3.86

	
0.10

	
80.00%

	
20084253

	
Debra A Ziehm

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M. 

Assessor's Tract # 105   

Sec 21: Lots 1, 2, 8, and 9

	
9/30/2008 - 2013    

5 years + 3 year ext option

	
9/29/2013

	
164.97

	
4.33

	
0.12

	
80.00%

	
20084252

	
Debra A Ziehm

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M.    

Assessor's Tract # 83       

Sec 27: Lots 5, 6, 10, 11, 12, 14, 15 & 16       

Sec 34: Lots 2, 3 Less acreage (see lease)

	
9/30/2008    

5 years + 3 year ext option

	
9/29/2013

	
409.65

	
5.37

	
0.15

	
80.00%

	
20084251

	
Debra A Ziehm

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M. 

Assessor's Tract # 82       

Sec 26: Lots 11, 12, 13, & 14      

Sec 27: Lots 2, 7, 8 & 9

	
9/30/2008   

5 years + 3 year ext option

	
9/29/2013

	
330.85

	
8.68

	
0.23

	
80.00%

	
20084250

	
Debra A Ziehm

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M. 

Assessor's Tract # 70   

Sec 21: Lots 4 & 5

	
9/30/2008    

5 years + 3 year ext option

	
9/29/2013

	
82.44

	
3.05

	
0.08

	
80.00%

	
20084249

	
Debra A Ziehm

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M.  

Assesor's Tract # 69    

Sec 21: Lots 3, 6, 7 & 10

	
9/30/2008     

5 years + 3 year ext option

	
9/29/2013

	
164.88

	
5.86

	
0.16

	
80.00%

	
20084248

	
Jim F. Kowach

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M.    

Sec 12: Lots 1,2,3,5,6,7,8,9,10,12,13,14,15    

Sec 13: Lots 2,3,4, less tract (see lease)

	
10/31/2008

	
10/30/2013

	
635.00

	
238.35

	
6.44

	
80.00%

	
20084634

	
Robert Deakins

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M.    

Sec 35: S/2

	
12/8/2008   

 5 years + 3 year ext option

	
12/7/2013

	
331.70

	
6.91

	
0.19

	
80.00%

	
20090152

	
Richard Deakins

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M.    

Sec 35: S/2

	
12/8/2008     

5 years + 3 year ext option

	
12/7/2013

	
331.70

	
6.91

	
0.19

	
80.00%

	
20090482

 

 

  

  

  

	
Kathleen Seely Brennise

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M.     

Sec 28: Tract in Lots 11, 12, 14   

Sec 31: Lots 5,6,11-14, 19,20, W/2        

Sec 32 Lots 7,10-14      

Sec 33:Tract in E2W2    

Sec 34: Lots 1, 7-16

	
1/29/2009   

5 years + 3 year ext option

	
1/28/2014

	
1507.93

	
145.69

	
3.93

	
80.00%

	
20091152

	
Bruce H. and Ann C. Seely

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M.     

Sec 28: Tract in Lots 11, 12, 14   

Sec 31: Lots 5,6,11-14, 19,20, W/2        

Sec 32 Lots 7,10-14      

Sec 33:Tract in E2W2    

Sec 34: Lots 14, 15, 16

	
3/1/2009    

5 years + 3 year ext option

	
2/28/2014

	
1179.60

	
15.00

	
0.41

	
80.00%

	
20091997

	
Bruce H. Seely

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M.     

Sec 28: Tract in Lots 11, 12, 14   

Sec 31: Lots 5,6,11-14, 19,20, W/2       

Sec 32 Lots 7,10-14      

Sec 33:Tract in E2W2    

Sec 34: Lots 1, 7-16     

Sec 35: Lots 4, 5

	
3/1/2009   

 5 years + 3 year ext option

	
2/28/2014

	
1590.92

	
146.56

	
3.96

	
80.00%

	
20091998

	
David R. and Shirley M. Seely

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M.    

Sec 6: Lot 7       

Sec 31: Lots 5,6,11-14, 19,20, W/2        

Sec 32 Lots 7,10-14      

Sec 33:Tract in E2W2    

Sec 34: Lots 1, 7-16     

Sec 35: Lots 4, 5

	
3/1/2009

 5 years + 3 year ext option

	
2/28/2014

	
1465.72

	
292.60

	
7.90

	
80.00%

	
20092472

	
Walter D. Spetter

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M.      

Sec 35: Lots 9,10 11,12,13,14,15,16 (S/2)

	
3/5/2009    

5 years + 3 year ext option

	
3/4/2014

	
331.70

	
13.820

	
0.37

	
80.00%

	
20092059

	
Donna McMullen

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M.      

Sec 35: Lots 9,10 11,12,13,14,15,16 (S/2)

	
3/5/2009     

5 years + 3 year ext option

	
3/4/2014

	
331.70

	
13.82

	
0.37

	
80.00%

	
20092058

	
DR Seely, LLC an Idaho Limited Liability Company

	
Buck Peak, LLC

	
T6N-R90W, 6th P.M.     

Sec 31: Lots 5,6,11-14, 19,20, W/2        

Sec 32 Lots 7,10-14   

Sec 34: Lots 1, 7-16    

Sec 35: Lots 4, 5

	
3/5/2009  

5 years + 3 year ext option

	
3/4/2014

	
1436.46

	
169.85

	
4.59

	
80.00%

	
20092471

	
Kathleen Seely Brennise

	
Buck Peak, LLC

	
T5N-R90W, 6th P.M.

Sec 3: Lots 6,7,8,9    

Sec 4: Lots 5 -13, 15, 16, 18-20   

Sec 6: Lots 12,13,14,17,18,19

	
7/9/2010

	
7/8/2015

	
1067.93

	
123.54

	
3.34

	
80.00%

	
20102826

 

  

  

  

	
Bruce and Ann Seely

	
Buck Peak, LLC

	
T5N-R90W, 6th P.M.   

Sec 3: Lots 6,7,8,9     

Sec 4: Lots 5 -13, 15, 16, 18-20   

Sec 6: Lots 12,13,14,17,18,19

	
7/9/2010

	
7/8/2015

	
1067.93

	
12.99

	
0.35

	
80.00%

	
20102591

	
Bruce Seely, Individually

	
Buck Peak, LLC

	
T5N-R90W, 6th P.M.   

Sec 3: Lots 6,7,8,9    

Sec 4: Lots 5 -13, 15, 16, 18-20   

Sec 6: Lots 12,13,14,17,18,19

	
7/9/2010

	
7/8/2015

	
1067.93

	
123.54

	
3.34

	
80.00%

	
20102590

	
David and Shirley Seely

	
Buck Peak, LLC

	
T5N-R90W, 6th P.M.   

Sec 3: Lots 6,7,8,9     

Sec 4: Lots 5 -13, 15, 16, 18-20   

Sec 6: Lots 12,13,14,17,18,19

	
7/9/2010

	
7/8/2015

	
1067.93

	
260.18

	
7.02

	
80.00%

	
20102827

	
D.R. Seely, LLC

	
Buck Peak, LLC

	
T5N-R90W, 6th P.M.   

Sec 3: Lots 6,7,8,9     

Sec 4: Lots 5 -13, 15, 16, 18-20   

Sec 6: Lots 12,13,14,17,18,19

	
7/9/2010

	
7/8/2015

	
1067.93

	
52.04

	
1.40

	
80.00%

	
20102825

	
Lease Serial No. COC-73459

	
Impact Energy Resources, LLC

	
T5N-R90W, 6th P.M. Section 1: Lot 5, 12, 13

	
3/1/2009

	
2/28/2019

	
125.15

	
125.15

	
3.38

	
80.00%

	  
	  	  	  	  	  	  	
1,933.86

	
52.21

	  	  

 

	  	  	  	  	  	  	  	  	  	  
	  	
Leases Value Allocation

	
Price per Net Acre

	
Net Acres

	
Assigned Value

	  	
Total Schedule 2.1 (a)

	
129.21

	  	  
	  	
Schedule 2.1 (a)

	
$100

	
129.21

	
$12,921

	  	  	  	  	  
	  	
Schedule 2.1 (b)

	
$1,050

	
244.98

	
$257,227

	  	  	  	  	  
	  	
Schedule 2.1 (c  )

	
$800

	
89.10

	
$71,283

	  	  	  	  	  
	  	
Total Value

	  	
463.29

	
$341,430

	  	  	  	  	  

 

  

  

  

  

 

SCHEDULE 2.1(b)

 

Assignment of Leases dated April ___, 2013

 

	 	 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	
BUCK PEAK LEASES AND EXPIRATION DATES

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	
LESSOR NAME AND ADDRESS

	 	
DESCRIPTION

	 	
DATE AND TERM

	 	 	
GROSS ACRES

	 	 	
NET ACRES

	 	 	
NET ACRES

	 	 	
NET ACRES

	 	 	
NET REVENUE INTEREST

	 	 	
RECORDING

	 
	  	 	  	 	 	 	 	 	 	 	 	 	 	
Buck Peak LLC

	 	 	
CONVEYED

	 	 	
to be delivered 8/8ths

	 	 	 	 
	
West Half of Section 25

	 	  	 	 	 	 	 	 	 	 	 	 	 	37.5	%	 	 	100	%	 	 	 	 	 	 
	  	 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	
Jim F. Kowach

	 	
T6N-R90W, 6th P.M.    Sec 25: W/2

	 	
10/31/2008 - 2014 6 years

	 	 	 	335.54	 	 	 	167.77	 	 	 	62.91	 	 	 	62.91	 	 	 	78.5000	%	 	 	20104936	 
	  	 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	
Barbara Wilaby

	 	
T6N-R90W, 6th P.M.    Sec 25: W/2

	 	
10/31/2011 - 2014 3 years

	 	 	 	335.54	 	 	 	167.77	 	 	 	62.91	 	 	 	62.91	 	 	 	78.5000	%	 	 	20103288	 
	
Sub Total - Kowach / Wilaby

	 	
W/2 Section 25, T6N R90W

	 	 	100.00	%	 	 	335.54	 	 	 	335.54	 	 	 	125.8275	 	 	 	125.83	 	 	 	78.5000	%	 	 	 	 
	  	 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	
East Half of Section 25

	 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	
Mark A Voloshin, 

PO Box 981, 

Craig, CO  81626

	 	
T6N-R90W, 6th P.M.   

Assessor's Tract # 74  

Sec 25: Lots 1, 2, 7, 8, 9,10,15,16

	 	
5/12/2011- 2016 Five (5) Years

	 	 	 	335.61	 	 	 	52.83	 	 	 	19.81	 	 	 	19.81	 	 	 	78.5000	%	 	 	20103153	 
	  	 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	
Betty Arnone, 

1713 South Vancouver Ct,

Lakewood, CO  80228

	 	
T6N-R90W, 6th P.M. 

Assessor's Tract # 74 

Sec 25: Lots 1,2,7,8,9,10,15 & 16

	 	
5/12/2011- 2016 Five (5) Years

	 	 	 	335.61	 	 	 	26.41	 	 	 	9.90	 	 	 	9.90	 	 	 	78.5000	%	 	 	20102832	 
	  	 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	
Helen McKee, 

10436 Jacob Place, 

Littleton, CO  80125-8932

	 	
T6N-R90W, 6th P.M.   

Assessor's Tract # 74 

Sec 25: Lots 1, 2, 7, 8, 9, 10, 15 & 16

	 	
5/12/2011- 2016 Five (5) Years

	 	 	 	335.61	 	 	 	26.41	 	 	 	9.90	 	 	 	9.90	 	 	 	78.5000	%	 	 	20102839	 
	  	 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	
Gary R Semro and Robert W. Semro,

 6522 Trailhead Rd, 

Highlands Ranch, CO  80130

	 	
T6N-R90W, 6th P.M. 

Assessor's Tract # 74 

Sec 25: Lots 1, 2, 7, 8, 9, 10, 15 & 16

	 	
5/12/2011- 2016 Five (5) Years

	 	 	 	335.61	 	 	 	26.41	 	 	 	9.90	 	 	 	9.90	 	 	 	78.5000	%	 	 	20102847	 
	  	 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	
Sharon Fitzgerald (Hebenstreit), 337 Coronado Drive, 

Sedalia, CO  80135

	 	
T6N-R90W, 6th P.M.   

Assessor's Tract # 74    

Sec 25: Lots 1, 2, 7, 8, 9,10,15,16

	 	
5/12/2011- 2016 Five (5) Years

	 	 	 	335.61	 	 	 	26.41	 	 	 	9.90	 	 	 	9.90	 	 	 	78.5000	%	 	 	20103140	 
	  	 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	
Brad Ocker (Eugena Grace Voloshin), 

9591 County Rd 33, 

Craig, CO  81625

	 	
T6N-R90W, 6th P.M. 

Assessor's Tract # 74 

Sec 25: Lots 1, 2, 7, 8, 9,10,15,16

	 	
5/12/2011- 2016 Five (5) Years

	 	 	 	335.61	 	 	 	8.55	 	 	 	3.21	 	 	 	3.21	 	 	 	78.5000	%	 	 	20102856	 
	
Sub Total - Semro / Voloshin

	 	
E/2 Section 25, T6N R90W

	 	 	49.7661	%	 	 	335.61	 	 	 	167.02	 	 	 	62.6325	 	 	 	62.63	 	 	 	78.5000	%	 	 	 	 
	  	 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	
BCK LLC

Charles S Keith

	 	
T6N-R90W, 6th P.M. A

ssessor's Tract # 74 Sec 25: 

Lots 1, 2, 7, 8, 9,10,15,16

	 	
2/22/2011 - 2014 3 years + 2 yr ext

	 	 	 	335.61	 	 	 	41.43	 	 	 	15.54	 	 	 	15.54	 	 	 	77.5000	%	 	 	20111728	 
	  	 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	
Strontia springs Resources, LLC

James Keith

	 	
T6N-R90W, 6th P.M. 

Assessor's Tract # 74 

Sec 25: Lots 1, 2, 7, 8, 9,10,15,16

	 	
2/22/2011 - 2014 3 years + 2 yr ext

	 	 	 	335.61	 	 	 	41.43	 	 	 	15.54	 	 	 	15.54	 	 	 	77.5000	%	 	 	20111730	 
	  	 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	
JZTZ LLC 

Debra Ann Ziehm

	 	
T6N-R90W, 6th P.M. 

Assessor's Tract # 74 

Sec 25: Lots 1, 2, 7, 8, 9,10,15,16

	 	
2/22/2011 - 2014 3 years + 2 yr ext

	 	 	 	335.61	 	 	 	41.43	 	 	 	15.54	 	 	 	15.54	 	 	 	77.5000	%	 	 	20111729	 
	  	 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	
MKRESOURCES LLC

Margaret Keith

	 	
T6N-R90W, 6th P.M.

Assessor's Tract # 74

Sec 25: Lots 1, 2, 7, 8, 9,10,15,16

	 	
2/22/2011 - 2014 3 years + 2 yr ext

	 	 	 	335.61	 	 	 	26.41	 	 	 	9.91	 	 	 	9.91	 	 	 	77.5000	%	 	 	20111731	 
	
Sub Total - Keith

	 	
E/2 Section 25, T6N R90W

	 	 	44.9075	%	 	 	335.61	 	 	 	150.71	 	 	 	56.52	 	 	 	56.52	 	 	 	77.5000	%	 	 	 	 
	  	 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	  	 	  	 	
Ownership %

	 	 	
Gross Acres

	 	 	
Net Acres

	 	 	
Buck Peak Net

	 	 	
Conveyed

	 	 	
NRI% Delivered

	 	 	 	 	 
	
West Half of Section 25

	 	  	 	 	100.0000	%	 	 	335.54	 	 	 	335.54	 	 	 	125.83	 	 	 	125.83	 	 	 	78.5000	%	 	 	 	 
	
East Half of Section 25

	 	  	 	 	94.6736	%	 	 	335.61	 	 	 	317.73	 	 	 	119.15	 	 	 	119.15	 	 	 	78.0257	%	 	 	 	 
	
SECTION 25 TOTAL

	 	  	 	 	97.3365	%	 	 	671.15	 	 	 	653.27	 	 	 	244.98	 	 	 	244.98	 	 	 	78.2693	%	 	 	 	 

 

  

  

  

EXHIBIT 5.1

CONVEYANCE, ASSIGNMENT AND BILL OF SALE

THIS CONVEYANCE, ASSIGNMENT  AND BILL OF SALE (this "Conveyance"), entered into as of April _, 2013, by and between Premier Energy Partners (I), LLC, a Colorado limited liability company ("Assignor"), and PetroShare Corp., a Colorado corporation ("Assignee"). Assignor and Assignee are referred to collectively herein as the "Parties."

RECITALS:

WHEREAS, Assignor is a party to the Leases attached hereto as Exhibit A (the "Leases");

WHEREAS, Assignor, as "Seller," and Assignee, as "Buyer," are parties to an Asset Purchase Agreement dated April _, 2013 (the "Purchase Agreement"), pursuant to which, subject to the terms and conditions set forth therein, Assignee will purchase substantially all of the assets of Assignor, including all of Seller's right, title and interest in, under and to the Leases; and

WHEREAS, simultaneously with the closing of the transactions contemplated by the Purchase Agreement, the Parties mutually desire that Assignor assign all of its right, title and interest in, under and to the Leases to Assignee on the terms and conditions hereinafter set forth.

NOW, THEREFORE, for and in consideration of Ten Dollars ($10.00) and other good and valuable consideration, the receipt and adequacy of which are expressly acknowledged, the Parties agree as follows:

1.   Effective Date. For all purposes under this Agreement, the term "Effective Date" shall mean that date, if any, on which the closing of the transactions contemplated by the Purchase Agreement is consummated.

2.   Assignment and Conveyance.  Effective as of the Effective Date, Assignor hereby assigns, bargains, sells, grants, transfers and conveys unto Assignee all of Assignor's right, title and interest in, under and to the following:

(a)  the Leases more particularly described on Exhibit A attached hereto and incorporated herein by this reference;

(b)  the land covered by, or subject to, or pooled or unitized with the Leases (the "Land");

(c)  the oil, gas and other hydrocarbons ("Hydrocarbons") in, on, under or produced from or attributable to the Land;

 

1

  

  

  

 

(d)  the contracts and contractual rights, obligations, and interests described in Exhibit B, and to the extent transferable, all other material contracts and contractual rights, obligations, and interests, including but not limited to all farmout and farmin agreements, operating agreements, surface use agreements, lease agreements, and other contracts or agreements  covering or affecting the Land or the Leases (collectively the "Contracts"); and

 

(e)  to the extent attributable to the Leases, Land, or Contracts:  (i) all rights with respect to the use and occupancy of the surface of and the subsurface depths under the Lands; (ii) all agreements and contracts, easements, rights-of-way, servitudes, and other estates; and (iii) all real and personal property located in or upon the Land or used in connection with the exploration, development or operation of the Leases.

3.    Bill of Sale.  Effective as of the Effective Date, Assignor hereby assigns, bargains, sells, grants, transfers and conveys unto Assignee all of Assignor's right, title and interest in, under and to the following (the "Records"):

(a)  data and information and copies of all 2D seismic data and interpretations thereof covering the Land, together with the shot records and digital data suitable for reprocessing, any planned or permitted 2D or 3D seismic shoot covering the Lands or parts thereof; and

(b)  any and all lease files, title files, land files, division order files, marketing files, well files, abstracts, title opinions, production records, seismic, geological, geophysical and engineering data, and all other files, maps and data (in whatever form) arising out of or relating to the Leases, Land, or Contracts.

4.    Assignor's Representations  & Warranties.  Assignor represents and warrants to Assignee that:

(a)  Assignor is the lawful owner of and has good and marketable title to the Leases;

(b)  Assignor will forever defend title to the Leases unto Assignee against the claims and demands of all persons claiming, or to claim the same, or any part thereof, by, through or under Assignor, but not otherwise;

(c)  Assignor has the power and authority to convey the Leases; and

(d)  the Leases are valid and subsisting leases.

5.    Purchase Agreement.  The Purchase Agreement contains certain representations, warranties, covenants and agreements between the parties, some of which survive the delivery of this Assignment, as provided therein and shall not be merged into this Conveyance or be otherwise negated by the execution or delivery of this Conveyance.  This Conveyance shall not be construed to amend the Purchase Agreement or vary the rights or obligations of either Assignor or Assignee from those set forth in the Purchase Agreement.  In the event of any conflict between this Conveyance and the Purchase Agreement, the terms of the Purchase Agreement shall control.

 

2

  

  

  

 

6.    Miscellaneous.

(a)  Headings. The section headings used herein are inserted for convenience only and shall not affect in any way the meaning or interpretation of this Agreement.

(b)  Governing law. This Agreement shall be governed by and construed in accordance with the laws of the State of Colorado.

(c)  Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original but all of which together will constitute one and the same instrument.

(d)  Binding Effect. The terms, covenants and conditions hereof shall be binding upon, and shall inure to the benefit of, Assignor and Assignee and their respective heirs, successors and assigns.  Such terms, covenants and conditions shall be covenants running with the land described herein and with the Leases and with each transfer or assignment of said land or the Leases.

TO HAVE AND TO HOLD unto the Assignee, its successors and assigns forever.

 

	 	
ASSIGNOR:

 

PREMIER ENERGY PARTNERS (I), LLC, a

Colorado limited liability company

	 
	 	 	 	 
	 	 	 	 
	 	By:	 	 
	 	 	Name:	 
	 	 	Title:	 
	 	 	 	 

 

 

[ACKNOWLEDGEMENTS ON FOLLOWING PAGE]

 

 

 

3

  

  

  

 

 

  

  

	STATE OF COLORADO	 	)	 
	 	 	)ss.	 
	COUNTY OF 	 	)	 

  

 

The foregoing instrument was acknowledged before me this  ______  day of April, 2013 by ________________________________, as _________________________________  of Premier Energy Partners (I), LLC, on behalf of the company.

 

 

	 	 	 
	 	Notary Public	 

 

 

	My commission expires:	 	.
	 	 	 

 

4

  

  

  

 

EXHIBIT A

 

Leases

 

 

 

See Attached

 

 

5

 

  

  

  

 

 

  

EXHIBIT B

 

Contracts

 

 

 

That certain Joint Operating Agreement by and between Premier Energy Partners (and others) and Quicksilver Resources Inc. dated July 27, 2010.

 

 

 

 

 

 

 

 

  

  

  

 

 

 

Exhibit 6.2(b) 

 

 

AFFIDAVIT OF NONFOREIGN STATUS

Section 1445 of the Internal Revenue Code provides that a buyer of a United States real property interest must withhold tax if the seller is a foreign person.  To inform PetroShare Corp (“Buyer”) that withholding of tax is not required upon the disposition of a United States real property interest owned by Premier Energy Partners (I) LLC, the undersigned hereby certifies the following on behalf of Premier Energy Partners (I) LLC:

	
1.  

	
Premier Energy Partners (I) LLC is not a non-resident alien, foreign corporation, foreign partnership, foreign trust, or foreign estate (as those terms are defined in the Internal Revenue Code and Income Tax Regulations);

	
2.  

	
The United States employer identification number of  Premier Energy Partners (I) LLC is ___________________; and

	
3.  

	
The office address of  Premier Energy Partners (I) LLC is:

P.O. Box 2328

Littleton, CO  80161

It is understood that this certification may be disclosed to the Internal Revenue Service by Buyer and that any false statement contained herein could be punished by fine, imprisonment, or both.

Under penalties of perjury I declare that I have examined this certification and it is true, correct and complete, and I further declare that I have authority to sign this document on behalf of  Premier Energy Partners (I) LLC.

Executed on _____________, 2013.

 Premier Energy Partners (I) LLC

 

___________________________________

Name:  _____________________________

Title:  ______________________________

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00235-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00235-of-00352.parquet"}]]