Document:

Exhibit 10.50

 

SECURITIES PURCHASE AGREEMENT

This SECURITIES
PURCHASE AGREEMENT (the “Agreement”), dated as of December 12, 2012, by and between EPAZZ, INC., an Illinois
corporation, with headquarters located at 309 West Washington Street - Suite 1225, Chicago, IL 60606 (the “Company”),
and ASHER ENTERPRISES, INC., a Delaware corporation, with its address at 1 Linden Place, Suite 207, Great Neck, NY 11021
(the “Buyer”).

 

WHEREAS:

 

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

 

B.            Buyer desires to purchase and the Company desires to issue and sell, upon the terms and conditions
set forth in this Agreement an 8% convertible note of the Company, in the form attached hereto as Exhibit A, in the aggregate principal
amount of $16,500.00 (together with any note(s) issued in replacement thereof or as a dividend thereon or otherwise with respect
thereto in accordance with the terms thereof, the “Note”), convertible into shares of common stock, $0.01 par value
per share, of the Company (the “Common Stock”), upon the terms and subject to the limitations and conditions set forth
in such Note.

 

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

 

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

 

1.            Purchase
and Sale of Note.

 

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

 

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

 

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c.            Closing Date. Subject to the satisfaction (or written waiver) of the conditions thereto
set forth in Section 6 and Section 7 below, the date and time of the issuance and sale of the Note pursuant to this Agreement (the
“Closing Date”) shall be 12:00 noon, Eastern Standard Time on or about December 14,
2012, or such other mutually agreed upon time. The closing of the transactions contemplated by this Agreement (the “Closing”)
shall occur on the Closing Date at such location as may be agreed to by the parties.

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

c.            Capitalization. As of the date hereof, the authorized capital stock of the Company consists
of: (i) 2,000,000,000 Class A of Common Stock $0.01par value per share, of which 76,788,072 shares are issued and outstanding;
and (ii) 60,000,000 shares of Class B Common Stock, ,$0.01 par value per share, of which 2,500,000 shares are issued and (iii)
40,000,000 shares of Preferred Stock, $0.001 par value per share, of which no shares are issued and outstanding; no shares are
reserved for issuance pursuant to the Company’s stock option plans, no shares are reserved for issuance pursuant to securities
(other than the Note and three (3) prior convertible promissory notes in favor of the Buyer:

 

		(a)	prior convertible promissory note dated in the amount of $42,500.00 dated June 27, 2012 pursuant
to which 55,900,000 shares of Common Stock are presently reserved

 

		(b)	prior convertible promissory note in favor of the Buyer dated July 24, 2012 in the amount of $32,500.00
pursuant to which 20,500,000 shares of Common Stock are presently
reserved

 

		(c)	prior convertible promissory note in favor of the Buyer dated October 16,2012, 2012 in the amount
of $27,500.00 pursuant to which 125,300,000 shares of Common
Stock are presently reserved

 

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exercisable
for, or convertible into or exchangeable for shares of Common Stock and  201,700,000 shares are
reserved for issuance upon conversion of the Note. All of such outstanding shares of capital stock are, or upon issuance will be,
duly authorized, validly issued, fully paid and non-assessable. No shares of capital stock of the Company are subject to preemptive
rights or any other similar rights of the shareholders of the Company or any liens or encumbrances imposed through the actions
or failure to act of the Company. As of the effective date of this Agreement, (i) there are no outstanding options, warrants, scrip,
rights to subscribe for, puts, calls, rights of first refusal, agreements, understandings, claims or other commitments or rights
of any character whatsoever relating to, or securities or rights convertible into or exchangeable for any shares of capital stock
of the Company or any of its Subsidiaries, or arrangements by which the Company or any of its Subsidiaries is or may become bound
to issue additional shares of capital stock of the Company or any of its Subsidiaries, (ii) there are no agreements or arrangements
under which the Company or any of its Subsidiaries is obligated to register the sale of any of its or their securities under the
1933 Act and (iii) there are no anti-dilution or price adjustment provisions contained in any security issued by the Company (or
in any agreement providing rights to security holders) that will be triggered by the issuance of the Note or the Conversion Shares.
The Company has furnished to the Buyer true and correct copies of the Company’s Certificate of Incorporation as in effect
on the date hereof (“Certificate of Incorporation”), the Company’s By-laws, as in effect on the date hereof (the
“By-laws”), and the terms of all securities convertible into or exercisable for Common Stock of the Company and the
material rights of the holders thereof in respect thereto. The Company shall provide the Buyer with a written update of this representation
signed by the Company’s Chief Executive on behalf of the Company as of the Closing Date.

 

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

 

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

 

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

 

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g.            SEC Documents; Financial Statements. Except as previously disclosed to the Buyer, the
Company has filed all reports, schedules, forms, statements and other documents required to be filed by it with the SEC pursuant
to the reporting requirements of the Securities Exchange Act of 1934, as amended (the “1934 Act”) (all of the foregoing
filed prior to the date hereof and all exhibits included therein and financial statements and schedules thereto and documents (other
than exhibits to such documents) incorporated by reference therein, being hereinafter referred to herein as the “SEC Documents”).
Upon written request the Company will deliver to the Buyer true and complete copies of the SEC Documents, except for such exhibits
and incorporated documents. As of their respective dates, the SEC Documents complied in all material respects with the requirements
of the 1934 Act and the rules and regulations of the SEC promulgated thereunder applicable to the SEC Documents, and none of the
SEC Documents, at the time they were filed with the SEC, contained any untrue statement of a material fact or omitted to state
a material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances
under which they were made, not misleading. None of the statements made in any such SEC Documents is, or has been, required to
be amended or updated under applicable law (except for such statements as have been amended or updated in subsequent filings prior
the date hereof). As of their respective dates, the financial statements of the Company included in the SEC Documents complied
as to form in all material respects with applicable accounting requirements and the published rules and regulations of the SEC
with respect thereto. Such financial statements have been prepared in accordance with United States generally accepted accounting
principles, consistently applied, during the periods involved and fairly present in all material respects the consolidated financial
position of the Company and its consolidated Subsidiaries as of the dates thereof and the consolidated results of their operations
and cash flows for the periods then ended (subject, in the case of unaudited statements, to normal year-end audit adjustments).
Except as set forth in the financial statements of the Company included in the SEC Documents, the Company has no liabilities, contingent
or otherwise, other than (i) liabilities incurred in the ordinary course of business subsequent to June 30, 2012, and (ii) obligations
under contracts and commitments incurred in the ordinary course of business and not required under generally accepted accounting
principles to be reflected in such financial statements, which, individually or in the aggregate, are not material to the financial
condition or operating results of the Company. The Company is subject to the reporting requirements of the 1934 Act.

 

h.            Absence of Certain Changes. Since June 30, 2012, there has been no material adverse change
and no material adverse development in the assets, liabilities, business, properties, operations, financial condition, results
of operations, prospects or 1934 Act reporting status of the Company or any of its Subsidiaries.

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

r.            Permits; Compliance. The Company and each of its Subsidiaries is in possession of all
franchises, grants, authorizations, licenses, permits, easements, variances, exemptions, consents, certificates, approvals and
orders necessary to own, lease and operate its properties and to carry on its business as it is now being conducted (collectively,
the “Company Permits”), and there is no action pending or, to the knowledge of the Company, threatened regarding suspension
or cancellation of any of the Company Permits. Neither the Company nor any of its Subsidiaries is in conflict with, or in default
or violation of, any of the Company Permits, except for any such conflicts, defaults or violations which, individually or in the
aggregate, would not reasonably be expected to have a Material Adverse Effect. Since June 30, 2012, neither the Company nor any
of its Subsidiaries has received any notification with respect to possible conflicts, defaults or violations of applicable laws,
except for notices relating to possible conflicts, defaults or violations, which conflicts, defaults or violations would not have
a Material Adverse Effect.

 

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s.            Environmental
Matters.

 

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

 

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

 

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

 

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

 

    	11

    	 

    

 

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

 

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

 

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

 

x.            [INTENTIONALLY DELETED]

 

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

 

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

 

    	12

    	 

    

  

4.            COVENANTS.

 

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

 

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

 

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

 

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

 

    	13

    	 

    

 

e.            Expenses. The Company’s sole obligation with respect to this transaction is to reimburse
Buyer’ expenses shall be $1,000, which shall be deducted from the proceeds of the loan.

 

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

 

g.            [INTENTIONALLY DELETED]

 

h.            Listing. The Company shall promptly secure the listing of the Conversion Shares upon each
national securities exchange or automated quotation system, if any, upon which shares of Common Stock are then listed (subject
to official notice of issuance) and, so long as the Buyer owns any of the Securities, shall maintain, so long as any other shares
of Common Stock shall be so listed, such listing of all Conversion Shares from time to time issuable upon conversion of the Note.
The Company will obtain and, so long as the Buyer owns any of the Securities, maintain the listing and trading of its Common Stock
on the OTCBB or any equivalent replacement exchange, the Nasdaq National Market (“Nasdaq”), the NasdaqSmallCap Market
(“NasdaqSmallCap”), the New York Stock Exchange (“NYSE”), or the American Stock Exchange (“AMEX”)
and will comply in all respects with the Company’s reporting, filing and other obligations under the bylaws or rules of the
Financial Industry Regulatory Authority (“FINRA”) and such exchanges, as applicable. The Company shall promptly provide
to the Buyer copies of any notices it receives from the OTCBB and any other exchanges or quotation systems on which the Common
Stock is then listed regarding the continued eligibility of the Common Stock for listing on such exchanges and quotation systems.

 

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

 

    	14

    	 

    

 

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

 

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

 

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

 

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

 

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

 

    	15

    	 

    

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

    	16

    	 

    

 

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

 

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

 

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

 

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

 

 

8.            Governing
Law; Miscellaneous.

 

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

 

b.            Counterparts. This Agreement may be executed in one or more counterparts, each of which
shall be deemed an original but all of which shall constitute one and the same agreement and shall become effective when counterparts
have been signed by each party and delivered to the other party. 

  

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

 

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

 

    	17

    	 

    

 

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

 

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

 

If to the
Company, to:

EPAZZ,
INC.

309 West
Washington Street - Suite 1225

Chicago,
IL 60606

Attn: SHAUN PASSLEY, Chief Executive
Officer

facsimile: [enter fax number]

 

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

The Loev
Law Firm, P.C.

Attn: David
M. Loev

6300 West
Loop South, Suite 280

Bellaire,
Texas 77041

facsimile:
713-524-4122

phone:
713-524-4110

 

If to the Buyer:

ASHER ENTERPRISES,
INC.

1 Linden
Pl., Suite 207

Great Neck,
NY. 11021

Attn: Curt Kramer,
President

facsimile:
516-498-9894

 

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

Naidich Wurman
Birnbaum &Maday LLP

80 Cuttermill Road,
Suite 410

Great Neck, NY11021

Attn: Bernard S.
Feldman, Esq.

facsimile:
516-466-3555

 

    	18

    	 

    

 

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

 

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

  

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

 

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

 

j.            Publicity. The Company, and the Buyer shall have the right to review a reasonable period
of time before issuance of any press releases, SEC, OTCBB or FINRA filings, or any other public statements with respect to the
transactions contemplated hereby; provided, however, that the Company shall be entitled, without the prior approval
of the Buyer, to make any press release or SEC, OTCBB (or other applicable trading market) or FINRA filings (including a Form 8-K
with regards to this Agreement and the Note) with respect to such transactions as is required by applicable law and regulations
(although the Buyer shall be consulted by the Company in connection with any such press release prior to its release and shall
be provided with a copy thereof and be given an opportunity to comment thereon).

 

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

 

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

 

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

 

    	19

    	 

    

  

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

 

 

EPAZZ, INC.

 

By:________________________________

SHAUN PASSLEY

Chief Executive Officer

 

ASHER ENTERPRISES, INC.

 

 

By:_________________________________

Name: Curt Kramer

Title: President

1 Linden Pl., Suite 207

Great Neck, NY 11021

 

 

AGGREGATE SUBSCRIPTION AMOUNT:

 

Aggregate Principal Amount of Note:$16,500.00

 

Aggregate Purchase Price:$16,500.00

 

 

 

 

3051(6) 12-12-12

Shaun@epazz.net

 

    	20

    	 

    

 

Exhibit A - Form of Opinion

 

NAIDICH
WURMAN BIRNBAUM &MADAY,
LLP

 

Attorneys at Law

80 Cuttermill Road, Suite 410

Great Neck, New York 11021

Telephone (516) 498-2900

Facsimile (516) 466-3555

 

	Richard S. Naidich	Mark Birnbaum
	Kenneth H. Wurman	Bernard S. Feldman
	Ronald C. Maday (Ret.)	Robert P. Johnson
	    _________	Of Counsel
	Judah A. Eisner	 

 

 

December 12, 2012

  

[TRANSFER AGENT]

  

Re: [ISSUER]

  

Ladies and Gentlemen:

  

We have acted as special counsel to ASHER
ENTERPRISES, INC. (“Seller”). We have been asked to provide an opinion in connection with the issuance (the “Issuance”)
without restrictive legend of ______________ shares (the “Shares”) of the common stock, par value $0.01 per share,
of EPAZZ, INC., an_____________ corporation (the “Company”), pursuant to Rule 144 of the Securities and Exchange Commission
(the “Commission”) under the Securities Act of 1933, as amended (the “Securities Act”) with respect to
the conversion of a certain convertible note dated __________________ by the Company in favor of Seller (“Note”) and
the conversion notice delivered pursuant to the Note dated the date hereof (the “Conversion Notice”).

 

Specifically, we have been asked to opine
whether shares of the Company’s common stock to be issued in conversion of the Note pursuant to the Conversion Notice are
"restricted securities" as that term is defined in Rule 144 ("Rule 144") promulgated by the Commission under
the Securities Act.

 

The opinion expressed in this letter is
limited solely to this issue, premised upon the federal securities laws of the United States as of the date of this letter, and
based upon the facts as presented to us contained within the instruments we have examined. We have conducted an independent investigation
into the underlying facts presented to us recited below and contained in the documents listed below.

 

In connection with preparing this letter,
we have prepared and re-examined and relied upon: (a) the Note, dated______________ executed by the Company; (b) the Securities
Purchase Agreement by and between the Company and the Seller dated ______________ (the “Purchase Agreement” and collectively
with the Note and any ancillary documents in connection with the Note, the “Transaction Documents); (c) the Conversion Notice
from the Seller dated the date hereof; (d) a representation letter executed by the Seller dated the date hereof; and (e) a limited
review of the most recent filing of the Company with the Commission pursuant to the Securities Act of 1934, as amended (the “Exchange
Act”).

 

    	21

    	 

    

 

Facts

 

We have received a representation letter
from the Seller that, among other things, represent to us the following facts, which we have assumed, and conducted an independent
investigation and determined that such representations, are true, correct and complete: (i) on _______________, the Company issued
the Note to the Seller in the amount of $___________0; (ii) on ______________ (the “Closing Date”), the Seller advanced
the funds to the Company with respect to the Note and the Note was fully paid as of such date; (iii) the Seller is not an "affiliate"
of the Company as defined in Rule 144(a)(1); and (iv) the Seller does not know of any material adverse information about the Company
or its prospects which has not been publicly disclosed. Furthermore, a limited review of the Company’s most recent filings
with the Commission pursuant to the Exchange Act indicate that: (i) the Company is a fully-reporting company under the Exchange
Act; (ii) the Company has filed all reports (our review is specifically limited to quarterly and annual reports) required under
the Exchange Act with the Commission for the preceding twelve months; and (iii) the Company is not a "shell company"
as that term is defined in Rule 144(i)(l)(i) nor has the Company been a “shell company” for a period of at least one
year.

 

Discussion

 

Based on the facts presented to us, the
Seller's holding period for the Note as determined by Rule 144(d) began when the Seller provided full consideration for the Note.
In this instance, the Seller has represented to us that the Note was fully paid on or before ______________.

 

In order for the Seller to convert the
Note into the Shares free of restrictions under Rule 144, the Issuance must meet the requirements of Rule 144(b)(1), which determines
the requirements for restrictions on securities for non-affiliates. Specifically, under Rule 144(b)(1), the issuance of the Shares
to the Seller without restriction must either meet or be exempt from the requirements of Rule 144(c) and 144(d). Based on a limited
review of the Company’s most recent filings with the Commission, the Company meets the current public information requirements
of Rule 144(c).

 

Pursuant to Rule 144(d)(3)(ii), the holding
period for securities issued in conversion of other securities of the same Company is deemed to have begun at the same time as
the securities surrendered for conversion. Therefore, the Seller's holding period is deemed to begin on the date that the Note
was fully paid which was on or before __________________.

  

Conclusion

 

Therefore, based upon the foregoing discussion,
the Shares issued to the Seller pursuant to the Conversion Notice are not "restricted securities" as defined in Rule
144 and should be issued to the Seller without any restrictive legend.

 

The opinions expressed in this letter are
premised upon the facts and circumstances as represented to us by the Seller and as made in the documents referred to above, on
which we have relied, without investigation. We also assume that the Seller will not become an “affiliate” of the Company
at any time that the Seller owns any of the Shares.

 

We are members of the bar of the State
of New York and are not licensed or admitted to practice law in any other jurisdiction. Accordingly, we express no opinion with
respect to the laws of any jurisdiction other than the laws of the State of New York and the federal laws of the United States.
Furthermore, we express no opinion regarding any federal or state law not specified expressly in this letter.

 

We assume no obligation to advise you of
any changes to this opinion which may come to our attention after the date hereof. This opinion may not be relied upon or furnished
to any other person except the addressee hereof without the express written consent of this firm.

 

 

Very truly yours,

 

NAIDICH, WURMAN, BIRNBAUM & MADAY,
LLP

 

 

BY_________________________________

 

    	22Exhibit 10.51

  

AMENDMENT NO. 1

TO

CONVERTIBLE PROMISSORY NOTE

 

This Amendment No. 1 to the Convertible
Promissory Note (this "Amendment") is executed as of April 12, 2013, by Epazz, Inc., an Illinois corporation (the
“Maker”); and ASHER ENTERPRISES, INC., a Delaware corporation, or its assigns ("Holder") to amend
the Convertible Promissory Note dated December 12, 2012 between those parties (the "Note").

 

The Maker and the Holder desire to amend
the Note and further agree as follows:

 

1. Capitalized Terms. Except as expressly provided in
this Amendment, all capitalized terms used in this Amendment have meanings ascribed to them in the Note and those definitions are
incorporated by reference into this Note.

 

2. Section 1.2(a) of the Note shall be deleted and the following
shall be substituted therefore:

 

Calculation of Conversion Price. The Conversion Price
shall be the greater of: (i) the Variable Conversion Price (as defined herein) and (ii) the Fixed Conversion Price (as defined
herein) (subject, in each case, to equitable adjustments for stock splits, stock dividends or rights offerings by the Borrower
relating to the Borrower’s securities or the securities of any subsidiary of the Borrower, combinations, recapitalization,
reclassifications, extraordinary distributions and similar events). The "Variable Conversion Price" shall mean 41% multiplied
by the Market Price (as defined herein)(representing a discount rate of 59%). “Market Price” means the average of the
lowest three (3) Trading Prices (as defined below) for the Common Stock during the ninety (90) Trading Day period ending on the
latest complete Trading Day prior to the Conversion Date. “Trading Price” means, for any security as of any date, the
closing bid price on the Over-the-Counter Bulletin Board, or applicable trading market (the “OTCBB”) as reported by
a reliable reporting service (“Reporting Service”) mutually acceptable to Borrower and Holder and hereafter designated
by Holders of a majority in interest of the Notes and the Borrower or, if the OTCBB is not the principal trading market for such
security, the closing bid price of such security on the principal securities exchange or trading market where such security is
listed or traded or, if no closing bid price of such security is available in any of the foregoing manners, the average of the
closing bid prices of any market makers for such security that are listed in the “pink sheets” by the National Quotation
Bureau, Inc. If the Trading Price cannot be calculated for such security on such date in the manner provided above, the Trading
Price shall be the fair market value as mutually determined by the Borrower and the holders of a majority in interest of the Notes
being converted for which the calculation of the Trading Price is required in order to determine the Conversion Price of such Notes.
“Trading Day” shall mean any day on which the Common Stock is traded for any period on the OTCBB, or on the principal
securities exchange or other securities market on which the Common Stock is then being traded. “Fixed Conversion Price”
shall mean $0.00009.

 

    	1

    	 

    

 

3. Section 1.6(d) of the Note shall be deleted and the following
heading and language shall be substituted therefore:

 

Adjustment Due to Dilutive Issuance. [INTENTIONALLY DELETED].

 

4. Section 1.6(e) of the Note shall be deleted and the following
heading and language shall be substituted therefore:

 

Purchase Rights. [INTENTIONALLY DELETED].

 

5. The last sentence of Section 1.7 of the Note shall be deleted
and replaced with the following:

 

Once the Maximum Share Amount has been issued, if the Borrower
fails to eliminate any prohibitions under applicable law or the rules or regulations of any stock exchange, interdealer quotation
system or other self-regulatory organization with jurisdiction over the Borrower or any of its securities on the Borrower’s
ability to issue shares of Common Stock in excess of the Maximum Share Amount, in lieu of any further right to convert this Note,
the liquidated damages that will be due is the amount of unconverted principal and Default Interest accrued through the date of
conversion.

 

6. Section 3.8 of the Note shall be deleted and the following
heading and language shall be substituted therefore:

 

The Borrower shall fail to maintain the listing of the Common
Stock on at least one of the OTCBB or an equivalent replacement exchange, the OTCQB tier maintained by OTC Markets Group, Inc.
(“OTCQB”), the Nasdaq National Market, the Nasdaq SmallCap Market, the New York Stock Exchange, or the American Stock
Exchange, or the Common Stock of the Borrower shall fail to be traded on the Pink Sheets.

 

7. Counterparts. This Amendment may be executed in any
number of counterparts, each of which shall be deemed an original as against the party whose signature appears thereon, and all
of which shall together constitute one and the same instrument. This Amendment shall become binding when one or more counterparts
hereof, individually or taken together, shall bear the signatures of all the parties reflected hereon as the signatories.

 

8. Third Parties. Except as specifically set forth or
referred to herein, nothing herein express of implied is intended or shall be construed to confer upon or give to any person other
than the parties hereto and their permitted successors or assigns, any claims, rights, remedies under or by reason of this Amendment.

 

9. Governing Law. This Amendment shall be governed and
construed in accordance with the laws of the State of New York applicable to agreements made and to be performed entirely within
such State and the federal laws of the United States of America, without regard to the conflict of laws rules thereof.

 

10. Integration. Except as specifically set forth by
this Amendment No. 1, the rest and remainder of the terms and conditions of the Note shall remain in full force and effect without
change or modification with the same force and effect as if more fully set forth hereat.

 

    	2

    	 

    

 

IN WITNESS WHEREOF, the undersigned have executed this Amendment
as of the date set forth above.

 

Epazz, Inc.

 

 

By: _______________________________

Shaun Passley

Chief Executive Officer 

 

 

 

 

ASHER ENTERPRISES, INC. 

 

 

By:_________________________________

Name: Curt Kramer

Title: President

1 Linden Pl., Suite 207

Great Neck, NY. 11021

 

    	3

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