Document:

ex101.htm

Exhibit 10.1

 

MEDEFILE INTERNATIONAL, INC.

 

SECURITIES PURCHASE AGREEMENT

 

This Securities Purchase Agreement (this “Agreement”) is made and entered into as of January 20, 2013, by and among MedeFile International, Inc., a Nevada corporation (the “Company”), and each of the purchasers listed on Exhibit A attached hereto (collectively, the “Purchasers” and individually, a “Purchaser”).

 

Recitals

 

	
A.  

	
The Company desires to issue and sell to the Purchasers, and the Purchasers desire to Purchase from the Company, up to 2,000,000 shares of common stock of the Company, on the terms and subject to the conditions set forth in this Securities Purchase Agreement.

	
  

	
B.

	
The Company and each Purchaser are executing and delivering this Agreement in reliance upon the exemption from securities registration afforded by the provisions of Regulation D (“Regulation D”), as promulgated by the United States Securities and Exchange Commission (the “SEC”) under the Securities Act of 1933, as amended (the “Securities Act”).

 

The parties hereto agree as follows:

 

1. Agreement To Purchase And Sell Stock.

 

(a) Authorization.  The Company’s Board of Directors has authorized the issuance and sale, pursuant to the terms and conditions of this Agreement, of up to 2,000,000 shares of common stock (the “Shares”).

 

(b) Agreement to Purchase and Sell Shares.  On the terms and subject to the conditions contained in this Agreement, each Purchaser severally agrees to purchase, and the Company agrees to sell and issue to each Purchaser, at Closing (as defined below), that number of Shares set forth on such Purchaser’s signature page, at a purchase price of $0.50 per Share.

 

(c) Use of Proceeds.  The Company intends to apply the net proceeds from the sale of the Shares for working capital and general corporate purposes, as well as for strategic purposes in connection with selected acquisitions that may be considered in the future to expand its product and service offerings.

 

(d) Obligations Several Not Joint.  The obligations of each Purchaser under this Agreement are several and not joint with the obligations of any other Purchaser, and no Purchaser shall be responsible in any way for the performance of the obligations of any other Purchaser under this Agreement.  Nothing contained herein, and no action taken by any Purchaser pursuant hereto, shall be deemed to constitute the Purchasers as a partnership, an association, a joint venture or any other kind of entity, or create a presumption that the Purchasers are in any way acting in concert or as a group with respect to such obligations or the transactions contemplated by this Agreement.  Each Purchaser shall be entitled to independently protect and enforce its rights, including without limitation the rights arising out of this Agreement, and it shall not be necessary for any other Purchaser to be joined as an additional party in any proceeding for such purpose.

 

2. Closing.  The closing of the purchase and sale of the Shares shall take place at the offices of Sichenzia Ross Friedman Ference LLP, 61 Broadway, New York, New York 10006 (the “SRFF Offices”) at 10:00 a.m. Eastern time on ________, 2013, or at such other time and place as the Company and Purchasers representing a majority of the Shares to be purchased mutually agree upon (which time and place are referred to in this Agreement as the “Closing”).  At Closing, each Purchaser shall deliver to the Company, via wire transfer or a certified check, immediately available funds for full payment of the purchase price for the Shares purchased by such Purchaser as specified in Section 1(b), and the Company shall deliver (or cause to be delivered by delivering an instruction letter to its transfer agent for the issuance) to each Purchaser its respective Shares registered in the name of each Purchaser (or in such nominee name(s) as designated by such Purchaser in the Stock Certificate Questionnaire (attached hereto as Appendix I) (the “Stock Certificate Questionnaire”), representing the appropriate number of Shares based on the number of Shares to be purchased by such Purchaser as set forth on such Purchaser’s signature page, and bearing the legend set forth in Section 4(j) herein.  Closing documents may be delivered by facsimile with original signature pages sent by overnight courier. The date of the Closing is referred to herein as the “Closing Date.”

 

 

  

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3. Representations and Warranties of The Company.  The Company hereby represents and warrants to each Purchaser that the statements in this Section 3 are true and correct:

 

(a) Organization, Good Standing and Qualification.  The Company and each of its Subsidiaries is a corporation duly organized, validly existing and in good standing under the laws of the jurisdiction in which it was formed. Each of the Company and its Subsidiaries has all corporate power and authority required to carry on its business as presently conducted and as described in the SEC Documents (as described below), and the Company has all corporate power and authority required to enter into this Agreement and the other agreements, instruments and documents contemplated hereby, and to consummate the transactions contemplated hereby and thereby.  Each of the Company and its Subsidiaries is duly qualified as a foreign entity to do business and is in good standing in each jurisdiction in which the failure to so qualify would have a Material Adverse Effect.  As used in this Agreement “Subsidiaries” means any entity in which the Company owns, directly or indirectly, 100% of the capital stock.  Further, as used in this Agreement, “Material Adverse Effect” means a material adverse effect on, or a material adverse change in, or a group of such effects on or changes in, the business, operations, condition, financial or otherwise, results of operations, prospects, assets or liabilities of the Company and its subsidiaries, taken as a whole.

 

(b) Capitalization.  The capitalization of the Company, without including the Shares to be purchased pursuant to this Agreement, is as follows:

 

(i) The authorized capital stock of the Company consists of 100,000,000 shares of common stock, par value $0.0001 per share (“Common Stock”), and 10,000,000 shares of preferred stock, par value $0.0001 per share (“Preferred Stock”).

 

(ii) As of January 9, 2013, the issued and outstanding capital stock of the Company consisted of 11,613,189 shares of Common Stock and 0 shares of Preferred Stock. The shares of issued and outstanding capital stock of the Company have been duly authorized and validly issued, are fully paid and nonassessable and have not been issued in violation of or are not otherwise subject to any preemptive or other similar rights.  All such shares have been issued in compliance with applicable securities laws.

 

(iii) As of January 9, 2013, the Company had (a) 0 shares of Common Stock reserved for issuance upon exercise of outstanding options granted under the Company’s incentive stock plans; and (b) 3,037,564 shares of Common Stock reserved for issuance upon exercise of outstanding warrants.

 

With the exception of the foregoing in this Section 3(b) and except as set forth in the SEC Documents (as defined in Section 3(k)(i) below),there are no outstanding subscriptions, options, warrants, convertible or exchangeable securities or other rights granted to or by the Company to purchase shares of Common Stock or other securities of the Company and there are no commitments, plans or arrangements to issue any shares of Common Stock or any security convertible into or exchangeable for Common Stock.  Except as set forth in SEC Documents, (A) no securities of the Company are entitled to preemptive or similar rights, and no person has any right of first refusal, preemptive right, right of participation, or any similar right to participate in the transactions contemplated by this Agreement; and (B)  the issue and sale of the Shares will not obligate the Company to issue shares of Common Stock or other securities to any person (other than the Purchasers) and will not result in a right of any holder of Company securities to adjust the exercise, conversion, exchange or reset price under such securities.  There are no stockholders agreements, voting agreements or other similar agreements with respect to the Company’s capital stock to which the Company is a party or, to the knowledge of the Company, between or among any of the Company’s stockholders.

 

(c) Subsidiaries.  Except as set forth in the SEC Documents, (i) the Company does not have any subsidiaries, and,  does not own any capital stock of, assets comprising the business of, obligations of, or any other interest (including any equity or partnership interest) in, any person or entity; (ii) the Company owns, directly or indirectly, all of the capital stock or other equity interests of each subsidiary free and clear of any liens, and all the issued and outstanding shares of capital stock of each subsidiary are validly issued and are fully paid, non-assessable and free of preemptive and similar rights to subscribe for or purchase securities.

 

(d) Due Authorization.  All corporate actions on the part of the Company necessary for the authorization, execution, delivery of, and the performance of all obligations of the Company under this Agreement and the authorization, issuance, reservation for issuance and delivery of all of the Shares being sold under this Agreement have been taken, no further consent or authorization of the Company or the Board of Directors or its stockholders is required, and this Agreement constitutes the legal, valid and binding obligation of the Company, enforceable against the Company in accordance with its terms, except (i) as may be limited by (A) applicable bankruptcy, insolvency, reorganization or others laws of general application relating to or affecting the enforcement of creditors’ rights generally and (B) the effect of rules of law governing the availability of equitable remedies and (ii) as rights to indemnity or contribution may be limited under federal or state securities laws or by principles of public policy thereunder.

 

 

 

  

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(e) Valid Issuance of Shares.

 

(i) Shares.  The Shares will be, upon payment therefore by the Purchasers in accordance with this Agreement, duly authorized, validly issued, fully paid and non-assessable, free from all taxes, liens, claims, encumbrances with respect to the issuance of such Shares and will not be subject to any pre-emptive rights or similar rights.

 

(ii) Compliance with Securities Laws.  Subject to the accuracy of the representations made by the Purchasers in Section 4 hereof, the Shares (assuming no unlawful redistribution of the Shares by the Purchasers or other parties as of the date hereof) will be issued to the Purchasers in compliance with applicable exemptions from (A) the registration and prospectus delivery requirements of the Securities Act and (B) the registration and qualification requirements of all applicable securities laws of the states of the United States.

 

(f) Consents and Approvals.  No consent, approval, order or authorization of, or registration, qualification, designation, declaration or filing with, or notice to, any federal, state or local governmental authority or self-regulatory agency or any other person on the part of the Company is required in connection with the issuance of the Shares to the Purchasers, or the consummation of the other transactions contemplated by this Agreement, except (i) such filings as have been made prior to the date hereof and (ii) such additional post-Closing filings as may be required to comply with applicable state and federal securities laws.

 

(g) Non-Contravention.  The execution, delivery and performance of this Agreement by the Company, and the consummation by the Company of the transactions contemplated hereby (including issuance of the Shares), do not: (i) contravene or conflict with the Certificate of Incorporation of the Company, as amended to date (the “Certificate of Incorporation”), or the Bylaws of the Company, as amended to date (the “Bylaws”) or the organizational documents of any Subsidiary; (ii) constitute a violation of any provision of any federal, state, local or foreign law, rule, regulation, order or decree applicable to the Company; or (iii) constitute a default (or an event that with notice or lapse of time or both would become a default) or require any consent under, give rise to any right of termination, cancellation or acceleration of, or to a loss of any material benefit to which the Company is entitled under, or result in the creation or imposition of any lien, claim or encumbrance on any assets of the Company under, any material contract to which the Company is a party or any material permit, license or similar right relating to the Company or by which the Company may be bound or affected.

 

(h) Litigation.  Except as set forth in the SEC Documents, there is no action, suit, proceeding, claim, arbitration or investigation (“Action”) pending or, to the Company’s knowledge, threatened in writing: (i) against the Company or any of its Subsidiaries, their respective activities, properties or assets, or any officer, director or employee of the Company or any of its Subsidiaries in connection with such officer’s, director’s or employee’s relationship with, or actions taken on behalf of, the Company or any of its Subsidiaries, that is reasonably likely to have a Material Adverse Effect; or (ii) that seeks to prevent, enjoin, alter, challenge or delay the transactions contemplated by this Agreement (including the issuance of the Shares).  Neither the Company nor any of its Subsidiaries is a party to or subject to the provisions of, any order, writ, injunction, judgment or decree of any court or government agency or instrumentality.  No Action is currently pending nor does the Company or any of its Subsidiaries intend to initiate any Action that is reasonably likely to have a Material Adverse Effect.

 

(i) Compliance.  The Company is not in violation or default of any provisions of the Articles of Incorporation or the Bylaws and none of the Company’s Subsidiaries is in violation or default of any provisions of their respective organizational documents.  The Company and each of its Subsidiaries has complied and is currently in compliance with all applicable statutes, laws, rules, regulations and orders of the United States of America and all states thereof, foreign countries and other governmental bodies and agencies having jurisdiction over the Company’s or each subsidiary’s respective businesses or properties, except for any instance of non-compliance that has not had, and would not reasonably be expected to have, a Material Adverse Effect.  Neither the Company nor any of its Subsidiaries is in default under or in violation of (and no event has occurred that has not been waived that, with notice or lapse of time or both, would result in a default by the Company or any subsidiary under), nor has the Company or any Subsidiary received notice of a claim that it is in default under or that it is in violation of, any indenture, loan or credit agreement or any other agreement or instrument to which it is a party or by which it or any of its properties is bound (whether or not such default or violation has been waived), except as does not, individually or in the aggregate, have or reasonably be expected to result in a Material Adverse Effect.

 

(j) Material Non-Public Information.  The Company has not provided to the Purchasers any material non-public information other than information related to the transactions contemplated by this Agreement, all of which information related to the transactions contemplated hereby shall be disclosed by the Company pursuant to Section 8(n) hereof.  The Company understands and confirms that each Purchaser shall be relying on the foregoing representations in effecting transactions in securities of the Company.

 

(k) SEC Documents.

 

(i) Reports.  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 “Exchange Act”), and the rules and regulations promulgated thereunder.  The Company has made available to the Purchasers prior to the date hereof copies of its Annual Report on Form 10-K for the fiscal year ended December 31, 2011 (the “Form 10-K”) , its Quarterly Reports on Form 10-Q for the periods ending March 31, 2012, June 30, 2012, and September 30, 2012, respectively (“Forms 10-Q”) and any Current Report on Form 8-K for events occurring since December 31, 2011 (“Forms 8-K”) filed by the Company with the SEC (the Form 10-K, Forms 10-Q and the Forms 8-K, together with any documents subsequently filed or furnished by the Company with the SEC are collectively referred to herein as the “SEC Documents”).  Each of the SEC Documents, as of the respective dates thereof (or, if amended or superseded by a filing prior to the Closing Date, then on the date of such filing), did not contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements made therein, in light of the circumstances under which they were made, not misleading.  Each SEC Document, as it may have been subsequently amended by filings made by the Company with the SEC prior to the date hereof, complied in all material respects with the requirements of the Exchange Act and the rules and regulations of the SEC promulgated thereunder applicable to such SEC Document.

 

 

  

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(ii) Sarbanes-Oxley.  The Chief Executive Officer and the Chief Financial Officer of the Company have signed, and the Company has furnished to the SEC, all certifications required by Sections 302 and 906 of the Sarbanes-Oxley Act of 2002.  Except as set forth in the SEC Documents, such certifications contain no qualifications or exceptions to the matters certified therein and have not been modified or withdrawn; and neither the Company nor any of its officers has received notice from any governmental entity questioning or challenging the accuracy, completeness, form or manner of filing or submission of such certifications.  Except as set forth in the SEC Documents, the Company is otherwise in compliance in all material respects with all applicable effective provisions of the Sarbanes-Oxley Act of 2002 and the rules and regulations issued thereunder by the SEC.  Except as set forth in the SEC Documents, the Company has established disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the Company and designed such disclosure controls and procedures to ensure that information required to be disclosed by the Company in the reports it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms.  The Company’s certifying officers have evaluated the effectiveness of the Company’s disclosure controls and procedures as of the end of the period covered by the Company’s most recently filed periodic report under the Exchange Act (such date, the “Evaluation Date”).  The Company presented in its most recently filed periodic report under the Exchange Act the conclusions of the certifying officers about the effectiveness of the disclosure controls and procedures based on their evaluations as of the Evaluation Date.  Since the Evaluation Date, there have been no changes in the Company’s internal control over financial reporting (as such term is defined in the Exchange Act) that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

 

(iii) Financial Statements.  The financial statements of the Company in the SEC Documents present fairly, in accordance with United States generally accepted accounting principles (“GAAP”), consistently applied, the financial position of the Company as of the dates indicated, and the results of its operations and cash flows for the periods therein specified, subject, in the case of unaudited financial statements for interim periods, to normal year-end audit adjustments.

 

(l) Absence of Certain Changes since the Balance Sheet Date.  Except as set forth in the SEC Documents, since December 31, 2011, the business and operations of the Company and each of its Subsidiaries have been conducted in the ordinary course consistent with past practice, and there has not been:

 

(i) any declaration, setting aside or payment of any dividend or other distribution of the assets of the Company or any of its Subsidiaries with respect to any shares of capital stock of the Company or any of its Subsidiaries or any repurchase, redemption or other acquisition by the Company or any subsidiary of the Company of any outstanding shares of the Company’s capital stock (and the Company has not made any agreements to do any of the foregoing);

 

(ii) any damage, destruction or loss, whether or not covered by insurance, except for such occurrences, individually and collectively, that have not had, and would not reasonably be expected to have, a Material Adverse Effect;

 

(iii) any waiver by the Company or any of its Subsidiaries of a valuable right or of a material debt owed to it, except for such waivers, individually and collectively, that have not had, and would not reasonably be expected to have, a Material Adverse Effect;

 

(iv) any material change or amendment to, or any waiver of any material right under a material contract or arrangement by which the Company or any of its Subsidiaries or any of its or their respective assets or properties is bound or subject;

 

(v) any change by the Company in its accounting principles, methods or practices or in the manner in which it keeps its accounting books and records, except any such change required by a change in GAAP or by the SEC; or

 

(vi) any other event or condition of any character, except for such events and conditions that have not resulted, and are not expected to result, either individually or collectively, in a Material Adverse Effect.

 

(m) Intellectual Property.

 

(i) Except as set forth in the SEC Documents, the Company and each of its Subsidiaries owns or possesses sufficient rights to use all patents, patent rights, inventions, trade secrets, know-how, trademarks, service marks, trade names, copyrights, information and other proprietary rights and processes (collectively, “Intellectual Property”), which are necessary to conduct its or their respective businesses as currently conducted and as described in the SEC Documents free and clear of all liens, encumbrances and other adverse claims, except where the failure to own or possess free and clear of all liens, encumbrances and other adverse claims would not reasonably be expected to result, either individually or in the aggregate, in a Material Adverse Effect.

 

(ii) Neither the Company nor any of its Subsidiaries has received any written notice of, nor has knowledge of, any infringement of or conflict with rights of others with respect to any Intellectual Property and neither the Company nor any of its Subsidiaries has knowledge of any infringement, misappropriation or other violation of any Intellectual Property by any third party, which, in either case, either individually or in the aggregate, if the subject of an unfavorable decision, ruling or finding, would reasonably be expected to have a Material Adverse Effect.

 

 

  

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(iii) To the Company’s knowledge, none of the patent rights owned or licensed by the Company or any of its Subsidiaries are unenforceable or invalid.

 

(iv) Each employee, consultant and contractor of the Company and each of its Subsidiaries who has had access to the Intellectual Property has executed a valid and enforceable agreement to maintain the confidentiality of such Intellectual Property and assigning all rights to the Company or such subsidiary to any inventions, improvements, discoveries or information relating to the business of the Company or such subsidiary.  The Company is not aware that any of its or its Subsidiaries’ employees is obligated under any contract (including licenses, covenants or commitments of any nature) or other agreement, or subject to any judgment, decree or order of any court or administrative agency, that would interfere with their duties to the Company or such subsidiary or that would conflict with the Company’s or such subsidiary’s business.

 

(v) Neither the Company nor any of its Subsidiaries is subject to any “open source” or “copyleft” obligations or otherwise required to make any public disclosure or general availability of source code either used or developed by the Company or any of its Subsidiaries.

 

(n) Registration Rights.  Except as set forth in the SEC Documents, the Company is not currently subject to any agreement providing any person or entity any rights (including piggyback registration rights) to have any securities of the Company registered with the SEC or registered or qualified with any other governmental authority.

 

(o) Title to Property and Assets.  Except as set forth in the SEC Documents, the properties and assets of the Company and its Subsidiaries are owned by the Company and its Subsidiaries free and clear of all mortgages, deeds of trust, liens, charges, encumbrances and security interests except for (i) statutory liens for the payment of current taxes that are not yet delinquent and (ii) liens, encumbrances and security interests that arise in the ordinary course of business and do not in any material respect affect the properties and assets of the Company.  With respect to the property and assets it leases, the Company is in compliance with such leases in all material respects.

 

(p) Taxes.  The Company and each of its Subsidiaries has filed or has valid extensions of the time to file all necessary federal, state, and foreign income and franchise tax returns due prior to the date hereof and has paid or accrued all taxes shown as due thereon, and the Company has no knowledge of any material tax deficiency that has been or might be asserted or threatened against it or any of its Subsidiaries.

 

(q) Insurance.  The Company and its Subsidiaries maintain insurance of the types and in the amounts that the Company reasonably believes is prudent and adequate for its business and which is at least as extensive as is customary for other companies in the Company’s industry, all of which insurance is in full force and effect.

 

(r) Labor Relations.  No material labor dispute exists or, to the knowledge of the Company, is imminent with respect to any of the employees of the Company or any of its Subsidiaries.  No executive officer, to the knowledge of the Company, is, or is now expected to be, in violation of any material term of any employment contract, confidentiality, disclosure or proprietary information agreement or non-competition agreement, or any other contract or agreement or any restrictive covenant, and the continued employment of each such executive officer does not subject the Company or any of its Subsidiaries to any liability with respect to any of the foregoing matters.

 

(s) Internal Accounting Controls.  The Company and its Subsidiaries maintain a system of internal accounting controls sufficient 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 GAAP 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.

 

(t) Transactions With Officers and Directors.  Except as set forth in the SEC Documents, none of the officers or directors of the Company has entered into any transaction with the Company or any Subsidiary that would be required to be disclosed pursuant to Item 404(a) or (c) of Regulation S-K of the SEC.

 

(u) General Solicitation.  Neither the Company nor any other person or entity authorized by the Company to act on its behalf has engaged in a general solicitation or general advertising (within the meaning of Regulation D of the Securities Act) of investors with respect to offers or sales of the Shares.  The Company has offered the Shares for sale only to the Purchasers and certain other “accredited investors” within the meaning of Rule 501 under the Securities Act.

 

(v) Listing Matters.  The Common Stock of the Company is quoted on the OTCQB under the ticker symbol “MDFI.”  The issuance and sale of the Shares under this Agreement does not contravene the rules and regulations of the OTCQB.

 

(w) Investment Company.  The Company and each of its Subsidiaries is not now, and after the sale of the Shares under this Agreement and the application of the net proceeds from the sale of the Shares described in Section 1(b) herein will not be, an “investment company” within the meaning of the Investment Company Act of 1940, as amended.

 

(y)           No Integrated Offering.  Neither the Company, nor any Affiliate of the Company, nor any person acting on its or their behalf has, directly or indirectly, engaged in any form of general solicitation or general advertising with respect to any security or made any offers or sales of any security or solicited any offers to buy any security, under circumstances that would cause the offering or issuance of the Shares to be integrated with prior offerings by the Company for purposes of the Securities Act which would cause Regulation D or any other applicable exemption from registration under the Securities Act to be unavailable, or would cause any applicable state securities laws exemptions or any applicable stockholder approval provisions exemptions, including, without limitation, under the rules and regulations of any national securities exchange or automated quotation system on which any of the securities of the Company are listed or designated to be unavailable, nor will the Company take any action or steps that would cause the offering or issuance of the Shares to be integrated with other offerings.

 

 

  

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(z)           Brokers.  Neither the Company nor any Subsidiary has any liability to pay any fees, commissions or other similar compensation to any broker, finder, investment banker, financial advisor or other similar person in connection with the transactions contemplated by this Agreement.  The Purchasers shall have no obligation with respect to any fees or with respect to any claims made by or on behalf of other persons for fees of a type contemplated in this Section that may be due in connection with the transactions contemplated by this Agreement.

(aa)           Application of Takeover Protections.  The Company and its Board of Directors have taken all necessary action, if any, in order to render inapplicable any control share acquisition, business combination, poison pill (including any distribution under a rights agreement) or other similar anti-takeover provision under the Company’s Articles of Incorporation (or similar charter documents) or the laws of its state of incorporation that is or could become applicable to the Purchasers as a result of the Purchasers and the Company fulfilling their obligations or exercising their rights under this Agreement, including without limitation as a result of the Company’s issuance of the Shares and the Purchasers’ ownership of the Shares.

(bb)           Purchaser Representations.  The Company acknowledges and agrees that no Purchaser makes or has made any representations or warranties with respect to the transactions contemplated hereby other than those specifically set forth in Section 4 hereof.

(cc)           No Disagreements with Accountants and Lawyers.  There are no disagreements of any kind presently existing, or reasonably anticipated by the Company to arise, between the Company and the accountants and lawyers formerly or presently employed by the Company.

(dd)           Acknowledgment Regarding Purchasers’ Purchase of Shares.  The Company acknowledges and agrees that each of the Purchasers is acting solely in the capacity of an arm’s length purchaser with respect to this Agreement and the transactions contemplated hereby.  The Company further acknowledges that no Purchaser is 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 advice given by any Purchaser or any of their respective representatives or agents in connection with this Agreement and the transactions contemplated hereby is merely incidental to the Purchasers’ purchase of the Shares.  The Company further represents to each Purchaser that the Company’s decision to enter into this Agreement has been based solely on the independent evaluation of the transactions contemplated hereby by the Company and its representatives.

(ee)           Manipulation of Price.  The Company has not, and to its knowledge no one acting on its behalf has, (i) taken, directly or indirectly, any action designed to cause or to result in the stabilization or manipulation of the price of any security of the Company to facilitate the sale or resale of any of the Shares, (ii) sold, bid for, purchased, or, paid any compensation for soliciting purchases of, any of the Shares or (iii) paid or agreed to pay to any person any compensation for soliciting another to purchase any other securities of the Company, other than, in the case of clauses (ii) and (iii), compensation paid to the Company’s placement agent and any approved broker-dealers in connection with the placement of the Shares.

(ff)           Legend Removal.  The Company agrees, upon a Purchaser’s reasonable request, to reissue certificates representing any of the Shares without the legend set forth in Section 4(j)(i) below: (i) while a registration statement covering the resale of such securities is effective under the Securities Act, (ii) following any sale of such securities pursuant to Rule 144 (assuming the transferor is not an affiliate of the Company), or (iii) if such legend is not required under applicable requirements of the Securities Act (including controlling judicial interpretations and pronouncements issued by the Commission). Following the effective date of a registration statement, which includes the Shares, or at such earlier time as a legend is no longer required for the Shares, the Company will, promptly following the delivery by a Purchaser to the Company or the Company’s transfer agent of a legended certificate representing such securities, deliver or cause to be delivered to such Purchaser a certificate representing such securities that is free from all restrictive legends.  If requested by a Purchaser, certificates for securities subject to legend removal hereunder shall be transmitted by the transfer agent of the Company to the Purchasers by crediting the account of the Purchaser’s prime broker with the Depository Trust Company (“DTC”).

(gg)           Equal Treatment of Purchasers.  No consideration shall be offered or paid to any Purchaser to amend or consent to a waiver or modification of any provision of any of this Agreement unless the same consideration is also offered to all of the Purchasers under this Agreement.  For clarification purposes, this provision constitutes a separate right granted to each Purchaser by the Company and negotiated separately by each Purchaser, and is intended for the Company to treat the Purchasers as a class and shall not in any way be construed as the Purchasers acting in concert or as a group with respect to the purchase, disposition or voting of Shares or otherwise.

4. Representations, Warranties and Certain Agreements of The Purchasers.  Each Purchaser hereby represents and warrants to the Company, severally and not jointly, and agrees that:

 

(a) Organization, Good Standing and Qualification.  The Purchaser has all corporate, membership or partnership power and authority required to enter into this Agreement and the other agreements, instruments and documents contemplated hereby, and to consummate the transactions contemplated hereby and thereby.

 

(b) Authorization.  The execution of this Agreement has been duly authorized by all necessary corporate, membership or partnership action on the part of the Purchaser.  This Agreement constitutes the Purchaser’s legal, valid and binding obligation, enforceable in accordance with its terms, except (i) as may be limited by (A) applicable bankruptcy, insolvency, reorganization or other laws of general application relating to or affecting the enforcement of creditors’ rights generally and (B) the effect of rules of law governing the availability of equitable remedies and (ii) as rights to indemnity or contribution may be limited under federal or state securities laws or by principles of public policy thereunder.

 

 

  

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(c) Litigation.  There is no Action pending to which such Purchaser is a party that is reasonably likely to prevent, enjoin, alter or delay the transactions contemplated by this Agreement.

 

(d) Purchase for Own Account.  The Shares are being acquired for investment for the Purchaser’s own account, not as a nominee or agent, and not with a view to the public resale or distribution thereof within the meaning of the Securities Act, without prejudice, however, to such Purchaser’s right at all times to sell or otherwise dispose of all or any part of such securities in compliance with applicable federal and state securities laws and as otherwise contemplated by this Agreement.  The Purchaser also represents that it has not been formed for the specific purpose of acquiring the Shares.

 

(e) Investment Experience.  The Purchaser understands that the purchase of the Shares involves substantial risk.  The Purchaser has experience as an investor in securities of companies and acknowledges that it can bear the economic risk of its investment in the Shares and has such knowledge and experience in financial or business matters that it is capable of evaluating the merits and risks of this investment in the Shares and protecting its own interests in connection with this investment.

 

(f) Accredited Investor Status.  The Purchaser is an “accredited investor” within the meaning of Regulation D promulgated under the Securities Act.

 

(g) Reliance Upon Purchaser’s Representations.  The Purchaser understands that the issuance and sale of the Shares to it will not be registered under the Securities Act on the ground that such issuance and sale will be exempt from registration under the Securities Act pursuant to Section 4(2) thereof, and that the Company’s reliance on such exemption is based on each Purchaser’s representations set forth herein.

 

(h) Receipt of Information.  The Purchaser has had an opportunity to ask questions and receive answers from the Company regarding the terms and conditions of the issuance and sale of the Shares and the business, properties, prospects and financial condition of the Company and to obtain any additional information requested and has received and considered all information it deems relevant to make an informed decision to purchase the Shares.  Neither such inquiries nor any other investigation conducted by or on behalf of such Purchaser or its representatives or counsel shall modify, amend or affect such Purchaser’s right to rely on the truth, accuracy and completeness of such information and the Company’s representations and warranties contained in this Agreement. Without limiting the generality of the foregoing, the Purchaser hereby acknowledges receipt and careful review of the SEC Documents, including all exhibits thereto,

 

(i) Restricted Securities.  The Purchaser understands that the Shares have not been registered under the Securities Act and will not sell, offer to sell, assign, pledge, hypothecate or otherwise transfer any of the Shares unless (i) pursuant to an effective registration statement under the Securities Act, (ii) such holder provides the Company with an opinion of counsel, in form and substance reasonably acceptable to the Company, to the effect that a sale, assignment or transfer of the Shares may be made without registration under the Securities Act and the transferee agrees to be bound by the terms and conditions of this Agreement, or (iii) such holder provides the Company with reasonable assurances (in the form of seller and broker representation letters) that the Shares can be sold pursuant to Rule 144 promulgated under the Securities Act (“Rule 144”). Notwithstanding anything to the contrary contained in this Agreement, the Purchaser may transfer (without restriction and without the need for an opinion of counsel) the Shares to its Affiliates (as defined below) provided that each such Affiliate is an “accredited investor” under Regulation D, and such Affiliate agrees to be bound by the terms and conditions of this Agreement and shall have the rights of a Purchaser hereunder.

 

For the purposes of this Agreement, an “Affiliate” of any specified Purchaser means any other person or entity directly or indirectly controlling, controlled by or under direct or indirect common control with such specified Purchaser.  For purposes of this definition, “control” means the power to direct the management and policies of such person or firm, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise.

(j) Legends.

 

(i) Shares. The Purchaser agrees that the certificates for the Shares shall bear the following legend and that the Purchaser will comply with the restrictions on transfer set forth in such legend:

 

“THESE SECURITIES HAVE NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO THE TRANSFEROR TO SUCH EFFECT, THE SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE COMPANY.”

 

The Company acknowledges and agrees that a Purchaser may from time to time pledge pursuant to a bona fide margin agreement with a registered broker-dealer or grant a security interest in some or all of the Shares to a financial institution that is an “accredited investor” as defined in Rule 501(a) under the Securities Act and who agrees to be bound by the provisions of this Agreement and, if required under the terms of such arrangement, such Purchaser may transfer pledged or secured Shares to the pledgees or secured parties. Further, no notice shall be required of such pledge. At the appropriate Purchaser’s expense, the Company will execute and deliver such reasonable documentation as a pledgee or secured party of Shares may reasonably request in connection with a pledge or transfer of the Shares, the preparation and filing of any required prospectus supplement under Rule 424(b)(3) under the Securities Act or other applicable provision of the Securities Act to appropriately amend the list of selling stockholders thereunder.

 

 

  

7

  

 

In addition, the Purchaser agrees that the Company may place stop transfer orders with its transfer agent with respect to such certificates in order to implement the restrictions on transfer set forth in this Agreement.  The appropriate portion of the legend and the stop transfer orders will be removed promptly (but in no event later than three (3) business days) upon delivery to the Company of such satisfactory evidence as reasonably may be required by the Company that such legend or stop orders are not required to ensure compliance with the Securities Act.  In addition, upon the declaration of the effectiveness of the Registration Statement which includes the Shares, the Company shall cause its counsel to deliver a blanket opinion (or separate opinions if the transfer agent will not accept a blanket opinion) to its transfer agent to cause the stock certificates evidencing the Shares to be issued to the Purchasers free of any Securities Act restrictive legends assuming compliance with the prospectus delivery requirements, to the extent required by Rule 172 of the Securities Act. Each of the Purchaser acknowledges and agrees that the Company will endeavor to remove any Securities Act restrictive legends pursuant to this Section j(ii) upon the representation contained herein that the Purchasers will comply with the prospectus delivery requirements, to the extent required by Rule 172 of the Securities Act.

 

(k) Questionnaires.  The Purchaser has completed or caused to be completed the Stock Certificate Questionnaire, and the answers  to such questionnaires are true and correct as of the date of this Agreement; provided, that the Purchasers shall be entitled to update such information by providing written notice thereof to the Company before the effective date of the Registration Statement.

 

(l) Prohibited Transactions.  During the last thirty (30) days prior to the date hereof, neither such Purchaser nor any Affiliate of such Purchaser, foreign or domestic, has, directly or indirectly, effected or agreed to effect any “short sale” (as defined in Rule 200 under Regulation SHO), whether or not against the box, established any “put equivalent position” (as defined in Rule 16a-1(h) under the 1934 Act) with respect to the Common Stock, borrowed or pre-borrowed any shares of Common Stock, or granted any other right (including, without limitation, any put or call option) with respect to the Common Stock or with respect to any security that includes, relates to or derived any significant part of its value from the Common Stock or otherwise sought to hedge its position in the Company’ securities (each, a “Prohibited Transaction”).

 

5. Conditions to The Purchaser’s Obligations at the Closing. The obligations of the Purchasers under Section 1(b) of this Agreement are subject to the fulfillment or waiver, on or before the Closing, of each of the following conditions:

 

(a) Representations and Warranties True.  Each of the representations and warranties of the Company contained in Section 3 shall be true and correct in all material respects on and as of the date hereof (provided, however, that such materiality qualification shall only apply to representations or warranties not otherwise qualified by materiality) and on and as of the date of the Closing with the same effect as though such representations and warranties had been made as of the Closing; provided, however, that if a representation and warranty is made as of a specific date, it shall be true and correct in all material respects only as of such date.

 

(b) Performance.  The Company shall have performed and complied in all material respects with all agreements, obligations and conditions contained in this Agreement that are required to be performed or complied with by it on or before the Closing and shall have obtained all approvals, consents and qualifications necessary to complete the purchase and sale described herein; provided, however, that the Company may furnish to each Purchaser a facsimile copy of stock certificate representing the Shares, with the original stock certificate held in trust by counsel for the Company until delivery thereof on the next business day.

 

(c) Reserved.

 

(d) Agreement.  The Company shall have executed and delivered to the Purchasers this Agreement.

 

(e) Securities Exemptions.  The offer and sale of the Shares to the Purchasers pursuant to this Agreement shall be exempt from the registration requirements of the Securities Act and the registration and/or qualification requirements of all applicable state securities laws.

 

(f) No Suspension of Trading or Listing of Common Stock.  The Common Stock of the Company (i) shall be designated for quotation on the OTCQB and (ii) shall not have been suspended from trading on the OTCQB.

 

(g) Reserved.

 

(h) Reserved.

 

(i) Reserved.

 

(j) No Statute or Rule Challenging Transaction.  No statute, rule, regulation, executive order, decree, ruling, injunction, action, proceeding or interpretation shall have been enacted, entered, promulgated, endorsed or adopted by any court or governmental authority of competent jurisdiction or any self-regulatory organization or the staff of any of the foregoing, having authority over the matters contemplated hereby that questions the validity of, or challenges or prohibits the consummation of, any of the transactions contemplated by this Agreement.

 

(k) Other Actions.  The Company shall have executed such certificates, agreements, instruments and other documents, and taken such other actions as shall be customary or reasonably requested by the Purchasers in connection with the transactions contemplated hereby.

 

6. Conditions to The Company’s Obligations at the Closing.  The obligations of the Company to the Purchasers under this Agreement are subject to the fulfillment or waiver, on or before the Closing, of each of the following conditions:

 

(a) Representations and Warranties True.  The representations and warranties of the Purchasers contained in Section 4 shall be true and correct in all material respects on and as of the date hereof (provided, however, that such materiality qualification shall only apply to representations and warranties not otherwise qualified by materiality) and on and as of the date of the Closing with the same effect as though such representations and warranties had been made as of the Closing.

 

(b) Performance.  The Purchasers shall have performed and complied in all material respects with all agreements, obligations and conditions contained in this Agreement that are required to be performed or complied with by it on or before the Closing and shall have obtained all approvals, consents and qualifications necessary to complete the purchase and sale described herein.

 

(c) Agreement.  The Purchasers shall have executed and delivered to the Company this Agreement (and Appendix I hereto).

 

(d) Securities Exemptions.  The offer and sale of the Shares to the Purchasers pursuant to this Agreement shall be exempt from the registration requirements of the Securities Act and the registration and/or qualification requirements of all applicable state securities laws.

 

(e) Payment of Purchase Price.  The Purchasers shall have delivered to the Company by wire transfer of immediately available funds, full payment of the purchase price for the Shares as specified in Section 1(b).

 

(f) No Statute or Rule Challenging Transaction.  No statute, rule, regulation, executive order, decree, ruling, injunction, action, proceeding or interpretation shall have been enacted, entered, promulgated, endorsed or adopted by any court or governmental authority of competent jurisdiction or any self-regulatory organization or the staff of any of the foregoing, having authority over the matters contemplated hereby that questions the validity of, or challenges or prohibits the consummation of, any of the transactions contemplated by this Agreement.

 

 

  

8

  

 

7. Registration Rights.

 

(a) If at any time the Company shall determine to register under the Securities Act of 1933, as amended (including pursuant to a demand of any Shareholder of the Company exercising registration rights) any of its Common Stock (other than a registration statement on Form S-4 or S-8), it shall send to the Purchasers, written notice of such determination at least thirty (30) days prior to the filing of any registration statement and, if within fifteen (15) days after receipt of such notice, the Purchasers, shall so request in writing, the Company shall use its best efforts to include in such registration statement all of the Registrable Shares that such Purchasers request to be registered, subject to the rules, regulations, and interpretations of the Securities and Exchange Commission, including, without limitation Rule 415 under the Securities Act.  For purposes of this Article III, the term "Registrable Shares" means and includes any of the Shares, as well as any shares of Common Stock of the Company issued or issuable upon the conversion or exercise of any warrant, right or other security or which is issued as a result of a stock split, dividend or other distribution with respect to or in exchange for or in replacement of the Shares. Notwithstanding the above, as to any particular Registrable Shares, such securities shall cease to be Registrable Shares when (i) a registration statement has been declared effective by the SEC and such Registrable Shares have been disposed of pursuant to such registration statement, (ii) such Registrable Shares have been sold under circumstances under which all of the applicable conditions of Rule 144 are met, (iii) such Registrable Shares may be sold without limitation under Rule 144 under the Securities Act, or (iv) such time as such Registrable Shares have been otherwise transferred to holders who may trade such shares without restriction under the Securities Act..

(b) If such registration involves an underwritten public offering and the total amount of securities, including Registrable Shares, requested by shareholders to be included in such offering exceeds the amount of securities that the managing underwriter determines in its reasonable discretion is compatible with the success of the offering, then the Company shall be required to include in the offering only that number of such securities, including Registrable Shares, which the managing underwriter determines in its reasonable discretion will not jeopardize the success of the offering (the securities so included to be apportioned in the following order of priority (A) first, to any Shareholder of the Company exercising registration rights pursuant to which the Company initiated the registration, (B) second, to the Company, (C) third, among the Purchasers requesting to register Registrable Shares on a pro rata basis according to each Purchasers’ ownership of Registrable Shares relative to all other Purchasers’ ownership of Registrable Shares who have requested registration hereunder, and, (D) fourth, to the extent additional securities may be included therein, pro rata among the other selling Shareholders according to the total amount of securities owned by each such Shareholder); provided, however, that in any registration other than the initial public offering of the Company's Common Stock the number of shares requested to be included by the Purchasers shall not be reduced below 20% of the total number of securities to be provided in the registration. For purposes of the preceding parenthetical concerning apportionment, for any selling Shareholder which is a holder of Registrable Shares and which is a partnership or corporation, the partners, retired partners and Shareholders of such Purchasers, or the estates and family members of any such partners and retired partners and any trusts for the benefit of any of the foregoing persons shall be deemed to be a single "selling Shareholder," and any pro-rata reduction with respect to such "selling Shareholder" shall be based upon the aggregate amount of shares carrying registration rights owned by all entities and individuals included in such "selling Shareholder," as defined in this sentence. If any Purchaser disapproves of the terms of such underwriting, he may elect to withdraw his or its Registrable Shares therefrom by written notice to the Company and the underwriter.

8. Miscellaneous.

 

(a) Successors and Assigns.  The terms and conditions of this Agreement will inure to the benefit of and be binding upon the respective successors and permitted assigns of the parties.  The Company shall not assign this Agreement or any rights or obligations hereunder without the prior written consent of the Purchasers holding a majority of the total aggregate number of Shares then outstanding (excluding any shares sold to the public pursuant to Rule 144 or otherwise).  A Purchaser may assign its rights under this Agreement to any person to whom the Purchaser assigns or transfers any Shares, provided that such transferee agrees in writing to be bound by the terms and provisions of this Agreement, and such transfer is in compliance with the terms and provisions of this Agreement and permitted by federal and state securities laws.

 

(b) Governing Law.  This Agreement will be governed by and construed and enforced under the internal laws of the State of Florida, without reference to principles of conflict of laws or choice of laws.  EACH PARTY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION HEREWITH OR ARISING OUT OF THIS AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREBY.

 

(c) Survival.  The representations and warranties of the Company and the Purchasers contained in Sections 3 and 4 of this Agreement shall survive until the second anniversary of the Closing Date.

 

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

 

(e) Headings.  The headings and captions used in this Agreement are used for convenience only and are not to be considered in construing or interpreting this Agreement.  All references in this Agreement to sections, paragraphs, exhibits and schedules will, unless otherwise provided, refer to sections and paragraphs hereof and exhibits and schedules attached hereto, all of which exhibits and schedules are incorporated herein by reference.

 

 

  

9

  

 

(f) Notices.  Any notices and other communications required or permitted under this Agreement shall be in writing and shall be delivered (i) personally by hand or by courier, (ii) mailed by United States first-class mail, postage prepaid or (iii) sent by facsimile directed (A) if to a Purchaser, at such Purchaser’s address or facsimile number set forth on such Purchaser’s signature page to this Agreement, or at such address or facsimile number as such Purchaser may designate by giving at least ten days’ advance written notice to the Company or (B) if to the Company, to its address or facsimile number set forth below, or at such other address or facsimile number as the Company may designate by giving at least ten days’ advance written notice to the Purchaser.  All such notices and other communications shall be deemed given upon (I) receipt or refusal of receipt, if delivered personally, (II) three days after being placed in the mail, if mailed, or (III) confirmation of facsimile transfer, if faxed.

 

The address of the Company for the purpose of this Section 8(f) is as follows:

 

MedeFile International, Inc.

301 Yamato Road, Suite 1200

Boca Raton, FL 33431

Tel:  (561) 912-3393

Fax:  (561) 912-3396

Attention: Kevin Hauser

with a copy to:

Sichenzia Ross Friedman Ference LLP

61 Broadway

New York, NY 10018

Tel:  (212) 930-9700

Fax: (212) 930-9725

Attention: Richard A. Friedman, Esq.

(g) Amendments and Waivers. This Agreement may be amended and the observance of any term of this Agreement may be waived only with the written consent of the Company and the Purchasers holding a majority of the total aggregate number of Shares then outstanding (excluding any shares sold to the public pursuant to Rule 144 or otherwise).  Any amendment effected in accordance with this Section 8(g) will be binding upon the Purchasers, the Company and their respective successors and permitted assigns.

 

(h) Severability.  If any provision of this Agreement is held to be unenforceable under applicable law, such provision will be excluded from this Agreement and the balance of the Agreement will be interpreted as if such provision were so excluded and will be enforceable in accordance with its terms.

 

(i) Entire Agreement.  This Agreement, together with all exhibits and schedules hereto and thereto, constitutes the entire agreement and understanding of the parties with respect to the subject matter hereof and supersedes any and all prior negotiations, correspondence, agreements, understandings, duties or obligations between the parties with respect to the subject matter hereof.

 

(j) No Additional Agreements. The Company does not have any written or oral contract, agreement, arrangement or understanding with any Purchaser with respect to the transactions contemplated by this Agreement other than as expressly stated herein.

 

(k) Further Assurances.  From and after the date of this Agreement, upon the request of the Company or the Purchasers, the Company and the Purchasers will execute and deliver such instruments, documents or other writings, and take such other actions, as may be reasonably necessary or desirable to confirm and carry out and to effectuate fully the intent and purposes of this Agreement.

 

(l) Meaning of Include and Including.  Whenever in this Agreement the word “include” or “including” is used, it shall be deemed to mean “include, without limitation” or “including, without limitation,” as the case may be, and the language following “include” or “including” shall not be deemed to set forth an exhaustive list.

 

(m) Fees, Costs and Expenses.  All fees, costs and expenses (including attorneys’ fees and expenses) incurred by any party hereto in connection with the preparation, negotiation and execution of this Agreement and the exhibits and schedules hereto and the consummation of the transactions contemplated hereby and thereby shall be the sole and exclusive responsibility of such party.  In addition, the Company will pay the costs associated with any filings with, or compliance with any of the requirements of any governmental authorities.

 

(n) 8-K Filing; Standstill.  On or before 5:30 p.m., eastern time, on the fourth business day following the date of this Agreement, the Company shall file a Current Report on Form 8-K describing the terms of the transactions contemplated by this Agreement in the form required by the Exchange Act and attaching this Agreement as an exhibit to such filing (the “8-K Filing”). From and after the filing of the 8-K Filing with the SEC, the Purchasers as a consequence of participating in the transactions contemplated by this Agreement shall not be in possession of any material, nonpublic information received from the Company, any of its subsidiaries or any of their respective officers, directors, employees or agents authorized to disclose such information, that is not disclosed in the 8-K Filing.  The Company shall not, and shall cause each of its subsidiaries and its and each of their respective officers, directors, employees and agents, not to, provide the Purchasers with any material, nonpublic information regarding the Company or any of its subsidiaries from and after the filing of the 8-K Filing with the SEC without the consent of the Purchasers.  If a Purchaser has, or believes it has, received any such material, nonpublic information regarding the Company or any of its subsidiaries prior to the Closing Date, it shall provide the Company with written notice thereof and the Company shall within five (5) business days thereafter, make public disclosure of such material, nonpublic information if permitted under applicable law or without breach or violation of any agreement, contract or other obligation of the Company unless the Board of Directors of the Company shall determine that such disclosure would reasonably be expected to result in a material and adverse effect on the Company or its business, prospects, finances or properties. Except for such disclosure as the Company is advised by counsel is required to be included in documents filed with the SEC or otherwise required by law, the Company shall not use the name of, or make reference to, any Purchaser or any of its Affiliates in any press release or in any public manner (including any reports or filings made by the Company under the Exchange Act) without such Purchaser's prior written consent, which consent shall not be unreasonably withheld.

 

 

 

  

10

  

(o) Reserved.

 

(p) Remedies.  In addition to being entitled to exercise all rights provided herein or granted by law, including recovery of damages, each Purchaser and the Company will be entitled to specific performance under this Agreement.  The parties agree that monetary damages may not be adequate compensation for any loss incurred by reason of any breach of obligations described in the foregoing sentence and hereby agrees to waive in any action for specific performance of any such obligation the defense that a remedy at law would be adequate.

 

(q)           Several Liability; Advice. Each Purchaser agrees that no other Purchaser nor the respective controlling persons, officers, directors, partners, agents or employees of any other Purchaser shall be liable to such Purchaser for any losses incurred by such Purchaser in connection with its investment in the Company.  Each Purchaser acknowledges that it is not relying upon any person, firm or corporation (including without limitation any other Purchaser), other than the Company and its officers and directors (acting in their capacity as representatives of the Company), in deciding to invest and in making its investment in the Company. The Company acknowledges that no Purchaser is acting or has acted as an advisor, agent or fiduciary of the Company (or in any similar capacity) with respect to this Agreement and any advice given by any Purchaser or any of its representatives in connection with this Agreement is merely incidental to the Purchasers’ purchase of securities of the Company hereunder.

(r)           Form D Filing. The Company hereby agrees that it shall file in a timely manner a Form D relating to the sale of the Shares under this Agreement, pursuant to Regulation D promulgated under the Securities Act.

The parties hereto have executed this Agreement as of the date and year first above written.

 

	 	
MedeFile International, Inc.

	 
	 	 	 	 
	
 

	
By: 

	/s/ Kevin Hauser	 
	 	 	Kevin Hauser	 
	 	 	Chief Executive Officer	 
	 	 	 	 

 

[PURCHASER SIGNATURE PAGES TO FOLLOW]

  

11

  

SIGNATURE PAGE TO

 

SECURITIES PURCHASE AGREEMENT

 

DATED AS OF JANUARY 20, 2013

BY AND AMONG

 

MEDEFILE INTERNATIONAL, INC.

 

AND EACH PURCHASER NAMED THEREIN

 

The undersigned hereby executes and delivers to MedeFile International, Inc., the Securities Purchase Agreement (the “Agreement”) to which this signature page is attached, which Agreement and signature page, together with all counterparts of such Agreement and signature pages of the other Purchasers named in such Agreement, shall constitute one and the same document in accordance with the terms of such Agreement.

 

 

	 	 	Number of Shares: 400,000	 
	 	 	 	 
	 	 	Name of Purchaser	 
	 	 	 	 
	 	 	Signature:  A&O Family LLC	 
	 	 	 	 
	 	 	By:  /s/ Anthony Ivankovich	 
	 	 	 	 
	 	 	Title:  Manager	 
	 	 	 	 
	 	 	Address:      	 
	 	 	 	 
	 	 	Telephone:    	 
	 	 	 	 
	 	 	Fax:   	 
	 	 	 	 
	 	 	Tax ID Number:   	 

 

                                                                        

                                                                         

                                                                         

  

12

  

 

EXHIBIT A

 

 

Schedule of Purchasers

 

  

13

  

 

A&O Family LLC

 

Appendix I

 

STOCK CERTIFICATE QUESTIONNAIRE

 

Please provide us with the following information:

 

	
1.The exact name that the Shares are to be registered in (this is the name that will appear on the stock certificate(s)). You may use a nominee name if appropriate:

	
A&O Family LLC

	
2.The relationship between the Purchaser of the Shares and the Registered Holder listed in response to item 1 above:

	  
	
3.The mailing address of the Registered Holder listed in response to item 1 above:

	  
	
4.The Tax Identification Number of the Registered Holder listed in response to item 1 above:

	  

 

 

 

 

 

 

 

 

14Exhibit 10.1

 

 

	
        
	
        United Overseas Bank (Malaysia)
Bhd (271809 K)

        PFS Credit

        Credit - Retail

        Level 27 Vista Tower, The Intermark,

        348 Jalan Tun Razak,

        50400 Kuala Lumpur, Malaysia

        Tel (603) 2787 5148 Fax (603) 2775 3921

        www.uob.com.my

 

Ref No.__________

Date: 25 January 2013

 

PRIVATE & CONFIDENTIAL

 

WONG WENG KUNG

C/O PRIME GLOBAL CAPITAL GROUP

11-2 JALAN 26/70A

DESA SRI HARTAMAS

50480 KUALA LUMPUR

WP KUALA LUMPUR

 

Dear
Sir/Madam,

 

APPLICATION FOR CREDIT FACILITY

 

We are pleased to inform
you that United Overseas Bank (Malaysia) Bhd ("the Bank") has agreed to make available for your use the following line
of credit on the terms and conditions in this letter.

 

1.   FACILITY

 

Flexi-Mortgage (FM) Facility of Ringgit Malaysia
________________ only _______________ ("the FM Limit") comprising the following:

		(a)	a Fixed Loan ("Fixed Loan") of Ringgit Malaysia ________________ only _______________, as the same may be reduced from time to time by repayment or prepayment (which principal limit
of the Fixed Loan as reduced from time to time is hereinafter referred to as "the FL Limit"); and

		(b)	a Mortgage Line ("Mortgage Line') of up to the difference between Ringgit
Malaysia zero (kM0.00) ("the Maximum ML Limit") and the FL Limit (which principal limit of the Mortgage Line as increased
from time to time is hereinafter referred to as "the ML Limit");

 

such that:

		(i)	so long as the FL Limit is equal to •or more than the Maximum ML Limit,
the ML Limit shall be zero;

		(ii)	when the FL Limit is reduced to below the Maximum ML Limit, the ML Limit
will be invoked;

		(iii)	once the ML Limit is invoked, the FL Limit will be reduced progressively
and the ML Limit will increase accordingly over time, but (1) the combined principal limit of the Fixed Loan and the Mortgage Line
shall not in any event exceed the Maximum ML Limit, and (2) the Maximum ML Limit shall not in any event exceed the FM Limit; and

		(iv)	for the purposes of computation of interest and determination of whether
the combined principal limit is exceeded, the Fixed Loan and the Mortgage Line shall, at all times whether before or after the
ML Limit is invoked, be deemed to be as one facility drawn and owing under one account;

 

subject however to the terms and conditions
contained herein.

 

 

 

AUSTRALIA   BRUNEI   CANADA
  CHINA   FRANCE   HONG KONG   INDONESIA   JAPAN   MALAYSIA   MYANMAR

PHILIPPINES   SINGAPORE
  SOUTH KOREA   TAIWAN   THAILAND   UNITED KINGDOM   USA   VIETNAM

 

    	1

    	 

    
 

 

 

Ref No.: 551460

 

 

		2.	INTEREST RATE

 

BLR -2% per annum on daily rests. The Bank's Base Lending Rate ("BLR")
is currently at 6.6% per annum.

 

Interest will be charged,
whether before or after the ML Limit is invoked, on the net amount of the daily outstanding balance of the Fixed Loan and the Mortgage

 

Line, and debited to the account for the Fixed Loan and the Mortgage Line Account respectively at the end of each calendar month.

As such, for the avoidance
of doubt, if the Mortgage Line Account is in credit balance and the amount of such credit balance exceeds the outstanding balance
of the Housing Loan/Fixed Loan, no interest will accrue.

		3.	PURPOSE OF FACILITY

3.1.   FM Facility is :

		(i)	to finance the purchase of a/an ________________ UNIT OF 12 STOREY
                                                                SHOP OFFICE known as NO E-0-2 (GROUND FLOOR) MEGAN AVENUE 1, NO 189 JALAN TUN RAZAK, KUALA LUMPUR, WP KUALA LUMPUR, MALAYSIA
                                                                up to the sum of RM _____________.

 

		4.	SECURITY

 

	4.1.		A 3rd party 1st legal charge for RM ____________  is to be created over
                                                                                a/an ________________ UNIT OF 12 STOREY SHOP OFFICE known as NO E-0-2 (________________ FLOOR) MEGAN AVENUE 1, NO 189 JALAN
                                                                                TUN RAZAK, KUALA LUMPUR, WP                                                                                 KUALA LUMPUR,
                                                                                MALAYSIA together with carpark(s) and accessory parcel(s)(if any) held under GRN40011/M1-E/1/363, LOT162
                                                                                SEKSYEN43, BANDAR KUALA LUMPUR, DAERAH WP KUALA LUMPUR, NEGERI WP KUALA LUMPUR ("Property") .

 

	4.2.		An assignment by you of the rights title and interest in and to the rental proceeds
(present and future) derived from the property described in item 4.1 under the heading "Security" for which a Deed of
Assignment of Rental Proceeds and Power of Attorney are to be executed. All rental proceeds are to be credited to such account
prescribed by the Bank from time to time.

		5.	AVAILABILITY PERIOD

 

	5.1.		The Fixed Loan granted herein is available for drawdown within 4 months from the date
hereof or such extended time as the Bank may allow at its discretion. All disbursements of loan for the purpose(s) as set out
in Paragraph 3 above shall be made via the Fixed Loan.

 

	5.2.		The Mortgage Line granted herein shall be subject to review by the Bank from time
to time and may be recalled by the Bank as it deems necessary at any time.

 

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Ref No.: 551460

  

	6.		REPAYMENT

 

	6.1.		The FL Facility is to be repaid by monthly instalments of principal and interest as
follows:

 

	(i)	Repayment Period	24 years or until the FL Facility and all interest thereon are fully settled.
	(ii)   	Instalment amount	RM
    ________________ per month.
	(iii)   	
        Instalment

        commencement date
	Full release of the FL Facility or any other date as the Bank decides at its absolute discretion.

 

	6.2.		The Bank shall be irrevocably authorized by the Borrower(s) to debit the current account
opened or to be opened in the name of the Borrower(s) with the lending branch of the Bank for the operation of the Mortgage Line
("the Mortgage Line Account") (whether before or after the Mortgage Line is made available to the Borrower(s) pursuant
to the terms hereunder) for payment of the aforesaid monthly instalments and/or any interest owing under the Fixed Loan and/or
any other fees, charges, costs and other amounts of any kind or nature whatsoever owing or payable by the Borrower(s) to the Bank
hereunder, notwithstanding that:

		(i)	prior to the availability of the Mortgage Line, such debiting may result in the Mortgage
                                                                Line Account to be in debit balance; or

		(ii)	upon the availability of the Mortgage Line, such debiting may result in the Mortgage Line
                                                                 Account to be overdrawn in excess of the ML Limit.

 

Hence, upon the availability
of the Mortgage Line, the Borrower(s) is not required to continue to service the monthly instalments as aforesaid, but is only
required to pay the monthly interest accruing on the Fixed Loan and the Mortgage Line and to repay such additional amount, if necessary,
to ensure that the Mortgage Line Account is not overdrawn in excess of the ML Limit.

 

	6.3.		Pending commencement of the monthly instalment payment, you shall be liable to pay
to the Bank interest on such amount of the Fixed Loan released at the interest rate stipulated herein, monthly in arrears.

 

	6.4.		The monthly instalments payable under the Fixed Loan may be paid by the Borrower(s)
prior to the due date in such proportion, at such frequency and upon such other terms as may be stipulated by the Bank from time
to time.

 

	6.5.		The instalment amount and period stipulated at any time may be varied at the Bank's
discretion on or after the date of first disbursement of the Fixed Loan.

 

	6.6.		The Bank will notify you when the monthly instalment payment is to start.

 

	6.7.		The Mortgage Line is repayable on demand.

 

	7.		EARLY EXIT FEE

 

	7.1.		An early exit fee of 2% (or such other rate as the Bank may at its sole and absolute
discretion prescribe from time to time) shall be charged on the amount of the Facility granted subject to a minimum prepayment
fee of RM5000.00 per facility (or such other minimum sum as the Bank may at its sole & absolute discretion prescribed from
time to time) in the event that:

		(i)	the FM Facility is to be refinanced; or 

		(ii)	the property secured hereunder is redeemed
or disposed of or released or discharged from the security created to secure the FM Facility;

 

and
such refinancing or disposal or discharge is made within 5 years from the date of first drawdown of the Fixed Loan
and/or Housing Loan ("Bonding Period").

 

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Ref No.: 551460

 

 

	7.2.		After the Bonding Period, the Borrower(s) may fully prepay the Fixed Loan and/or Housing
Loan Facility subject to the Borrower(s) giving the Bank one (1) month's notice in writing or such other tenor as the Bank may
stipulate from time to time (or payment of one (1) month's or such other corresponding tenor's interest in lieu of such notice).

 

	8.		FORMAL VALUATION

 

A
professional valuation of the Property mentioned under the heading "Security" is to be carried out by valuer
approved by the Bank before disbursement of the Facility(ies). Should the value of the Property be less than RM
_______________ the Facility(ies) may be revised and the limit thereof be 'reduced or cancelled at the sole discretion of the
Bank. All cost and expenses of valuation is to be borne by you.

 

	9.		EXEMPT PRIVATE COMPANY

 

Receipt
by the Bank of:

		(i)	your company secretary's confirmation that the
chargor is an exempt private company; and

		(ii)	a letter of undertaking from the shareholders
of the chargor undertaking not to dispose of their shares during the tenure of the Facilities.

 

	10.		ADDITIONAL CONDITIONS PRECEDENT

 

In addition to the fulfilment of the usual conditions
precedent for the disbursement of the Facility(ies), the following additional conditions precedent are also to be met prior to
the disbursement of the Facility(ies):

		(i)	A copy of the Sale and Purchase Agreement for the Property mentioned
                                                               under the heading "Security" is to be submitted to the Bank with a purchase price of not less than RM _____________,
                                                               failing which the Bank has the discretion to revise or cancel the Facility(ies) granted.

		(ii)	FM Facility is to be released subject to Valuation Report of not less than RM
                                                                _____________ mentioned under the heading "Formal Valuation".

 

	11.		SPECIAL CONDITIONS

 

	11.1.		This offer is made in reliance on the information provided by you in the Final Property
Loan Application Form ("FPLA"). You shall fulfill all of the following conditions to the satisfaction of the Bank within
seven (7) days from the date of this letter, failing which this offer lapses unless otherwise agreed by the Bank:

 

		(i)	Submit the following documents to the Bank:

 

		(a)	Property details: documentary evidence showing the details as stated in the FPLA form;

		(b)	Income documents: documentary evidence showing your and/or guarantor's income.
The income in the documentary evidence shall not be less than the income amount shown in the FPLA:

 

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Ref No.: 551460

		(c)	Loan outstanding with existing bank: latest loan statements for the property
given to the Bank as security, showing the amount outstanding with the existing bank. The amount in the loan statements shall not
exceed the loan outstanding amount stated in the FPLA form;

		(d)	Evidence of Prompt Payment: Evidence of satisfactory track record of repayment
of your/the guarantor's facilities with existing financiers (if any) for the past twelve (12) months or such period the Bank requires;

		(e)	Any other documentary evidence the Bank requires at its absolute discretion.

 

		(i)	Cash and/or Investments: Deposit with the
Bank, unencumbered cash and/or investments of not less than the amount stated in the FPLA Form.

 

	12.		CANCELLATION

 

	12.1.		The Bank has the right at its sole and absolute discretion to cancel the Facility
in any of the following events :

 

		(i)	the information or documents submitted in
connection with the application for the Facility :

		(a)	contains untrue or misleading information or statements; or

		(b)	is incomplete or not up-to-date; or

		(c)	contains any form of misrepresentation; or

		(d)	is forged or tampered with.

 

		(ii)	the Bank doubts the authenticity or accuracy
of the information or documents submitted in connection with the application for the Facility;

 

		(iii)	the Bank suspects that there is an element
of fraud in sale and purchase transaction or the underlying transaction for which the Bank is providing the Facility;

 

		(iv)	any matter concerning the property
given to the Bank as security (including but not limited to tenure, ownership, market value) are not to the satisfaction of
the Bank;

 

		(v)	the property given to the Bank as
security is subjected to conditions or restrictive covenants contained in the title or the sale and purchase agreement, which
in the Bank's opinion is unfavourable to the Bank;

 

		(vi)	you fail to submit the documents requested
by the Bank within the time period stipulated by the Bank;

 

		(vii)	the Bank suspects that the Facility may
not be used for the intended purpose;

 

		(viii)	the terms and conditions stipulated by the developer or land owner (where applicable) in their consent to the creation of any security
granted to the Bank are not acceptable to the Bank for any reason; or

 

		(ix)	the Bank decides at its sole discretion
that the granting of the Facility is likely to be detrimental to its own position, or is otherwise undesirable.

 

 

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Ref No.: 551460

 

 

	13.		SERVICING BRANCH

 

	13.1.		Please contact 03 — 2787 5148 if you have any questions before the Facility
is disbursed.

 

	13.2.		The servicing branch for the Facility is at UOBM KEPONG Branch at 82 GROUND FLOOR,
JALAN 3/62D, MEDAN PUTRA BIZ CTR SRI MENJALARA, OFF JALAN DAMANSARA, 52200 , WP KUALA LUMPUR MALAYSIA (Tel: 03-62866888).

 

	14.		INTEGRAL PART

 

This letter must read together with Annexure and
the Bank's Standard Terms and Conditions Governing Banking Facilities which form an integral part of this letter.

 

	15.		EXISTING FACILITIES

 

The terms and conditions for any of your existing
facilities (if any) will remain unchanged unless expressly varied in this letter.

 

If the above arrangements are acceptable to you,
please confirm by returning a signed copy of this letter to the Bank within fourteen (14) clays from the date of this letter (or
such other period as may be extended by the Bank), failing which this offer will lapse.

 

We
thank you for banking with us and look forward to a mutually beneficial relationship.

 

 

 

 

Yours
faithfully,

for
UNITED OVERSEAS BANK (MALAYSIA) BHD.

 

 

	/S/ PHANT TENG AL	 	/S/ DANIEL NG GEN HONG
	PHANG TENG AL	 	DANIEL NG GEN HONG
	Manager	 	SALES MANAGER
	 	 	DSTHL/PFSD

 

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Ref No.: 551460

 

 

I/We confirm that I/We have read the above terms
and conditions, the Bank's Standard Terms And Conditions Governing Banking Facilities, the Annexure to the Letter of Offer attached
and agree to be bound by them.

 

 

 

 

/s/ Wong Weng Kung

Name: WONG WENG KUNG

NI No: 720909085057

Contact No: 03 62013198/0122025108

 

 

Signature verified:

Officer's Name:

Date:

 

 

NURZAWANI BINTI HAIRUL ANUAR

 

 

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Ref No.: 551460

Name of Borrower : WONG WENG KUNG

 

ANNEXURE TO
THE LETTER OF OFFER

 

	1.		PREPARATION EXECUTION OF LOAN DOCUMENTS

 

	1.1.		Notwithstanding the provisions on the Availability Period contained in this Letter
of Offer:

		(i)	all relevant documents for purposes of enabling our solicitors to prepare
and proceed with loan

documentation are to be forwarded to us or our solicitors upon request; and

		(ii)	the loan documents relating to the FM Facility granted herein are to be
executed within seven (7) days from the date of notification to you by our solicitors that the documents are ready for execution
(or such extended time as the Bank may allow);

 

failing which we have
a right to immediately cancel the FM Facility granted herein due to your default and recover all costs (if any) incurred by us
pursuant to our granting of the FM Facility herein.

 

	2.		REVIEW

 

	2.1.		The availability, limits, interest rates, commission, fees, charges and terms and
conditions of the Facility(ies) herein are subject to guidelines issued from time to time by Bank Negara Malaysia or any other
authority having jurisdiction over the Bank and to the Bank's periodical review and variation from time to time at the Bank's
sole and absolute discretion.

 

	3.		DEFAULT RATE

	3.1.		In the event at any time:

		(i)	the Mortgage Line shall be overdrawn in excess of the implemented ML Limit
for a period of thirty (30) days or more, but less than ninety (90) days; or

		(ii)	the Mortgage Line Account shall be overdrawn (whether before or after the
Mortgage Line is available) for a period of thirty (30) days or more, but less than ninety (90) days;

 

the Bank shall be entitled
to vary the prescribed rate for the FM Facility to 1.5% per annum above the Bank's BLR with daily rests (or such other rate as
the Bank may at its sole and absolute discretion prescribe from time to time) on the balance outstanding without any prior notice
to the Borrower notwithstanding any provisions to the contrary herein contained and without prejudice to the Bank's rights to recall
the FM Facility, and such varied prescribed rate shall continue to apply notwithstanding that the Borrower(s) may have at any time
after such variation remedied such default and/or regularized the Mortgage Line Account.

 

	3.2.		In the event at any time:

		(i)	the Mortgage Line shall be overdrawn in excess of the implemented ML Limit
for a period of ninety (90) days or more; or

 

		(ii)	the Mortgage Line Account shall be overdrawn (whether before or after the
Mortgage Line is available) for a period of ninety (90) days or more;

 

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Ref No. : 551460

 

 

the Bank shall be entitled to further vary the prescribed rate for the FM Facility to 3.5% per annum above
the Bank's BLR with daily rests (or such other rate as the Bank may at its sole and absolute discretion prescribe from time to
time) on the balance outstanding without any prior notice to the Borrower notwithstanding any provisions to the contrary herein
contained and- without prejudice to the Bank's rights to recall the FM Facility, and such varied prescribed rate shall
continue to apply notwithstanding that the Borrower(s) may have at any time after such variation remedied such default and/or
regularized the Mortgage Line Account.

 

	3.3.		Interest at the rate of 3.5% per annum above the Bank's BLR or such other rate as
the Bank may at its sole discretion prescribe from time to time to be calculated on daily rests shall be charged on all utilization
in excess of the implemented ML Limit for the Mortgage Line as computed and stated herein, both after as well as before any demand
or judgement, and notwithstanding that the banker and customer relationship may have ceased or have been terminated.

 

	3.4.		Interest at the rate of 3.5% per annum above the Bank's BLR or such other rate as
the Bank may at its sole discretion prescribe from time to time to be calculated on daily rests shall be charged on all overdrawn
amounts in the Mortgage Line Account, both after as well as before any demand or judgement, and notwithstanding that the banker
and customer relationship may have ceased or have been terminated.

 

	3.5.		Interest at the rate of 3.5% per annum above the Bank's BLR or such other rate as
the Bank may at its sole and absolute discretion prescribe from time to time shall be charged on any temporary facility approved
by the Bank.

 

	3.6.		Subject always to the provisions of Paragraph 3.7 below, all interest on any principal
sum as aforesaid including all capitalised interest shall at the end of each calendar month or such other periods as the Bank
may from time to time stipulate be capitalised and added for all purposes to the principal sum then owing and shall thenceforth
bear interest at the relevant prescribed rate and/or at any increased rate and be secured and payable accordingly and all the
covenants and conditions contained in or implied by this Letter of Offer and all powers and remedies conferred by law or by this
Letter of Offer, the Security Documents and all rules of law or equity in relation to the said principal sum and interest shall
equally apply to such capitalised arrears of interest and to interest on such arrears.

 

	3.7.		For the purpose of ascertaining whether the limit of the principal intended to be
secured by the security documents has been exceeded or not, all accumulated. and capitalized interest shall be deemed
to be interest and not principal sum.

 

	3.8.		The Bank reserves the right to increase the prevailing interest rate to at least the
Bank's Base Lending Rate, in the event the difference between the Bank's Base Lending Rate and Overnight Policy Rate declines
to below 2%.

 

	4.		TERMS AND CONDITIONS APPLICABLE TO THE MORTGAGE LINE

 

	4.1.		A current account shall be opened in the name of the Borrower(s) with the lending
branch of the Bank for the operation of the Mortgage Line ("the Mortgage Line Account") prior to any disbursement of
loan under the FM Facility.

 

	4.2.		The amounts repaid or prepaid under the Fixed LOan may be made available for drawdown
under the Mortgage Line at any time prior to the date of recall or termination of the Mortgage Line notwithstanding full payment
of the Fixed Loan Subject To the following:

 

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Ref No. : 551460

 

 

		(i)	no amount may be drawndown by the Borrower(s) under the Mortgage Line if it will cause the implemented
ML Limit as stated herein to be exceeded, unless the Bank in its absolute discretion otherwise agree; and

 

		(ii)	all sums drawn or repaid under the Mortgage Line must be debited or credited to the Mortgage Line
Account; and

 

		(iii)	all security granted for the FM Facility shall not have been discharged; and

 

		(iv)	no event of default as referred to in the Bank's Standard Terms And Conditions Governing Banking
Facilities attached herein and/or any of the Security Documents shall have occurred at the time of drawdown; and

 

		(v)	the Borrower(s) shall have conducted and serviced the Fixed Loan account with the Bank in a manner
satisfactory to the Bank for the past twelve (12) months; and

 

		(vi)	the Fixed Loan shall have been fully disbursed; and

 

		(vii)	all amounts repaid under the Mortgage Line may be redrawn upon the terms contained in this paragraph
4.2 above.

 

The above conditions are inserted
for the sole benefit of the Bank and the compliance therewith or any of them or any part thereof may at the Bank's absolute discretion,
be waived wholly or in part with or without terms or conditions as the Bank deems appropriate. Any such waiver shall not prejudice
or otherwise affect the Bank's rights, powers and remedies under this Letter of Offer and the Security Documents.

 

	4.3.		Interest charged on the Mortgage Line is to be serviced monthly in arrears.

 

	4.4.		The Mortgage Line granted herein is subject to review from time to time by the Bank
without notice to the Borrower(s).

 

	4.5.		The Bank shall be irrevocably authorized by the Borrower(s) to debit the Mortgage
Line Account (whether before or after the Mortgage Line is made available to the Borrower(s) pursuant to the terms hereunder)
for payment of any overdue interest and/or instalments owing under the Housing Loan and/or any other fees. charges, costs and
other amounts of any kind or nature whatsoever owing or payable by the Borrower(s) to the Bank hereunder, notwithstanding that:

 

		(i)	prior to the availability of the Mortgage Line, such debiting may result in the Mortgage Line Account
to be in debit balance; or

 

		(ii)	upon the availability of the Mortgage Line, such debiting may result in the Mortgage Line Account
to be overdrawn in excess of the ML Limit.

 

	4.6.		The Bank is under no obligation to adjust the amount of the instalments after the
Borrower has made a prepayment.

 

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Ref No. : 551460

 

	5.		OTHER CHARGES

 

	5.1.		The Bank can charge you the following fees and charges at the rate stated below (or
such other rate fixed by the Bank at any time at its absolute discretion):-

 

	Fee/Charge	Rate	Remarks
	Maintenance Fee	RM120 per year	This fee is charged on and debited to the current account annually in arrears on 1 January every year.
	Fee for payment of instalment or part of it exceeding the second payment made over the counter or via Fast Cheque Deposit Machine for any particular month.	RM5 per transaction	This fee will not be imposed on payment made via other modes such as the Bank's Call Centre or Automated Teller Machine or Cash Deposit Machine or Electronic Scanning Machine
	Postage Charge	RM70 per year	Charged on and debited to each Housing Loan, Fixed Loan, Overdraft and Flexi Mortgage (Mortgage Line) account annually, where the correspondence address of such accounts is outside Malaysia
	Cancellation Fee	RM2000	This fee is charged if the Facilities or any part of it is cancelled before the first disbursement of the Facilities for any reasons.
	Processing Fee	RM200 per facility	A one time processing fee is payable by you upon first disbursement of the Facility. This fee is to be debited to your loan account. This fee is only applicable to Malaysians who take Flexi Mortgage ("FM") and/or Intelligent Retail ("iRL") loans excluding commercial properties which are LOFT, SOHO, SOFO, SOVO and Developer Interest Bearing Scheme ("DIBS") loans.

 

	5.2.		For refinancing cases, you will bear all costs, fees and charges imposed by the existing
financier in connection with the refinancing, including the prepayment fee for early settlement.

 

	5.3.		The Bank may impose such other charges it deems necessary from time to time by giving
twenty one (21) days' notice.

 

	5.4.		Any changes to fees and charges can be made by the Bank at any time at its absolute
discretion by giving you advance notice of twenty one (21) days.

 

	6.		CONFLICTING TERMS

 

If there is an inconsistency between this document
and any security document created in favour of the Bank, the terms and conditions in this document will apply. The terms in any
security documents will be read with the necessary changes to be consistent with the terms in this document.

 

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Ref No. : 551460

 

 

The lodgement of private caveat
on any master title or individual title will be at the Bank's absolute discretion. You will not hold the Bank liable for the Bank's
decision.

 

	8.		TELECOMMUNICATION INSTRUCTIONS

 

	8.1.		The Bank is authorized to act on your instructions given by facsimile transmission,
email or other means of telecommunication which the Bank believes came from you. The Bank will not be liable for any loss or damage
that may be suffered by you if the telecommunication instructions came from persons other than you.

 

	8.2.		The risk of misunderstandings, errors, unauthorized alterations or instructions and
forgery, and the risk of operational failures or faults or errors howsoever occurring in the course of transmission of your instructions
are yours. The Bank will not be liable for any loss, liability or expenses that may result from such misunderstandings; errors,
unauthorized alterations or instructions, forgery, operational failures or faults.

 

	8.3.		You undertake to fully indemnify the Bank and keep the Bank fully indemnified against
all actions, claims, demands, liabilities, losses, damages, costs and expenses of whatever nature which the Bank may sustain,
suffer or incur because of the Bank agreeing to act on such telecommunication instructions.

 

	8.4.		The Bank can at any lime at its discretion refuse to execute any such instructions
or any part of it without incurring any responsibility or liability to you arising out of such refusal.

 

	9.		BANK'S SIGNATURE

 

The
Bank can sign this letter by affixing a scanned image of the signature of its authorized officer and/or any method the Bank at
its sole and absolute discretion deems fit.

 

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STANDARD
TERMS AND CONDITIONS GOVERNING BANKING FACILITIES

Granted by UNITED OVERSEAS BANK (MALAYSIA) BHD

To :

	Under the Facility Letter dated	(Our Ref :                                          )

 

The following are the Standard Terms and
Conditions referred to in the Facility Letter.

 

1.      BEFORE WE MAKE AVAILABLE ANY FACILITY

 

The following conditions must have been fulfilled
before We make available or continue to make available any Facility to You:

 

1.1      If You are an Individual

 

	1.1.1		You, Your spouse, either of Your parents, or any of Your children must not be an employee
or a director of any of the financial institutions in Our Group (unless permitted by guidelines issued by any authority which
has jurisdiction over Us).

1.2      If You are an Association or a Co-operative
Society

 

	1.2.1		Any of Your office-bearers, his/her spouse, parent or child must not be an employee
or a director of any of the financial institutions in Our Group (unless permitted by guidelines issued by any authority which
has jurisdiction over Us).

	1.2.2		We must have received from You proof acceptable to Us:

	 	(a)  	that You are duly registered and validly existing under Malaysian laws, that You have the necessary power and authority under
Your rules or constitution documents to own assets, to borrow money, and to give or create security for any money borrowed by
You; and
	 	 	 
	 	(b)	that Your members have given the necessary approval under Your rules or constitution documents for You to accept the Facility and
to give or create the security for the Facility; and
	 	 	 
	 	(c)	that the persons named by You as being authorised to act for You and whose sample signatures You have given to us certified as
true by an advocate and solicitor are persons duly approved by Your members to act for You in relation to the Facility under Your
rules or constitution documents.

 

1.3      If You are a Company

 

	1.3.1		Any of Your directors, managers, agents, shareholders, his/her spouse, parent or child
must not be an employee or a director of any of the financial institutions in Our Group (unless permitted by guidelines issued
by any authority which has jurisdiction over Us).

	1.3.2		We must have received from You:

		(a)	proof acceptable to Us that You are duly incorporated and validly existing under Malaysian laws,
that You have the necessary power and authority under Your Memorandum and Articles of Association to own assets, to carry on the
business that You are carrying on, to borrow money, and to give or create security for any money borrowed by You; and

		(b)	a resolution of Your directors passed in accordance with Your Articles of Association:

		(1)	authorising You to accept the Facility and to give or create the security for the Facility;

		(2)	specifying the names of the persons who are authorised to act for You and showing their sample
signatures which have been certified as true by Your company secretary; and

		(3)	authorising the affixing of Your common seal on the Security Documents.

	1.3.3		We must be satisfied that the manner of Your acceptance of the Facility and Your performance
and observance of Your obligations as stated in the Facility Letter, the Security Documents and these Terms and Conditions will
not:

		(a)	conflict with or result in any breach of Your Memorandum and Articles of Association or any law,
regulation, order, guideline, judgment, contract or anything else which binds you; or

		(b)	cause any powers which You or any of Your directors have to be exceeded.

 

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1.4       If you are an individual, Association, Co-operative
Society or Company

 

	1.4.1		Any person creating or giving the Security, his/her spouse, parent or child must not
be an employee or a director of any of the financial institutions in Our Group.

	1.4.2		Any director of any company creating or giving the Security, his/her spouse, parent
or child must not be an employee or a director of any of the financial institutions in Our Group.

 

	1.4.3		If the Facility is to be used, whether partly or wholly, to redeem any outstanding
loan owing by You to any person, We must have received from such person an undertaking in writing acceptable to Us to refund to
Us any redemption money paid by Us if any discharge or reassignment given by the person is not registrable or is not valid or
not effective in any way.

	1.4.4		You must have opened a current account with us.

 

	1.4.5		Any of the Events of Default listed in these Terms and Conditions must not have occurred,
must not be continuing or must not occur if We make any advance on the Facility or if We continue to make the Facility available.

	1.4.6		If a company is creating or giving the Security, We must have received a resolution
of the directors of the company authorising the creation or giving of the Security.

 

	1.4.7		If a company creating or giving the Security does not get any direct or indirect commercial
benefit from creating or giving the Security, We must have received:

		(a)	the unanimous resolution of the shareholders of the company authorising
the creation or giving of the Security; and

		(b)	written confirmation from the directors of the company that the company
is not facing any winding-up proceedings and will not be facing any winding-up proceedings when the Security is created or given.

 

	1.4.8		Your use or continued use of the Facility must not be in breach of any Malaysian law,
rule, guideline or regulation including those issued by Bank Negara Malaysia or any other authority which has jurisdiction over
Us.

	1.4.9		If You want Us to act on instructions from You by telephone, facsimile transmission,
electronic mail, telex or cable. You must have given Us a signed Indemnity for Taking Fax, Oral and Written Instructions and a
signed Telefax Agreement.

 

	1.4.10		You and any Security Party must not be in default under any agreement which You, or
such Security Party, are a party to.

	1.4.11		There must not be any legal or arbitration proceedings pending or on-going against
You or any Security Party which might affect Your ability, and the ability of such Security Party, to perform and observe the
obligations as stated in the Facility Letter, the Security Documents and these Terms and Conditions.

 

	1.4.12		All the information provided by You or any Security Party, in relation to Your application
for the Facility must be true and complete. You, and any such Security Party, must not have withheld from us any information which
might cause Us Not to grant You the Facility or not to accept the Security.

	1.4.13		The Security Documents as prepared by Us or Our solicitors must have been duly executed
within two (2) weeks of Your being informed that the Security Documents are ready for execution. We reserve the right to cancel
the Facility if the documents are not executed within those two (2) weeks; however, any cost and expense incurred by Us in the
preparation of the Security Documents will still have to be borne by you.

 

	1.4.14		All conditions required by Us to be fulfilled before We make available the Facility
or any part of the Facility must have been fulfilled to Our satisfaction.

 

2.      IF FACILITY IS FOR PURCHASE OF PROPERTY / IF SECURITY IS PROPERTY 

          

Before We release the Facility or any part of the Facility:

 

	2.1		A Private caveat must have been lodged over the property by Us; You are to, bear all
the fees and expenses relating to the lodgment and subsequent removal of the private caveat.

	2.2		You must have paid:

 

	2.2.1		the difference between the facility to purchase property and the purchase price of
the property;

	2.2.2		all stamp duties including the stamp duty payable for the transfer or the assignment
of the property in your favour and the stamp duty payable on all the Security Documents;

 

	2.2.3		all fees and expenses payable to any valuer We may have appointed to value the property;

	2.2.4		all fees and expenses payable to any solicitor We may have retained to prepare the
Security Documents; and

 

	2.2.5		all moneys which may be payable by You as purchaser to any developer of the property.

 

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	2.3		If Your sale and purchase agreement prescribes that certain documents have to be delivered
to Us, We must have received those documents.

	2.4		If the property is currently charged or assigned to another financial institution,
We must have received from that financial institution:

 

	2.4.1		a statement in writing stating the redemption sum, that is, the sum required to be
paid to it to redeem the property;

	2.4.2		an undertaking in writing to deliver to Us:

		(a)	a registrable discharge of charge or a valid and effective deed of receipt
and reassignment, as the case may be;

		(b)	the duplicate charge, if the property is currently charged to it;

		(c)	the original of the issue document of title, if the property is currently charged to it;

		(d)	all security documents held by it, including the originals of all previous
sale and purchase agreements, deeds of assignments and deeds of receipts and reassignments, if the property is currently assigned
to it; and

		(e)	an undertaking in writing to refund to Us the redemption sum paid to it
by Us if the discharge of charge is not registrable or if the deed of receipt and reassignment is not valid or effective for any
reason whatsoever;

 

upon Our payment of the redemption sum to it.

 

	2.4.3		We must have received from the vendor of the property;

		(a)	the original of the issue document of title, if the property is currently not charged; and

		(b)	an undertaking in writing to refund to Us all sums received by it from Us
if the memorandum of transfer is not registrable in Your favour for any reason whatsoever or if the deed of assignment in Your
favour is not valid or is not effective for any reason whatsoever, as the case may be.

 

	2.4.4		If no document of title has been issued yet in respect of the property:

 

	(a)		We must have received from the developer or the proprietor of the property an undertaking
in writing:

		(1)	to deliver to Us upon the issue of the title the original of the issue document
of title together with a memorandum of transfer duly executed by the developer or the proprietor in Your favour; and

		(2)	not to further charge the land on which the property is situated without
having previously informed Us in writing.

	(b)		We must have received from You the original of Your sale and purchase agreement relating
to the property.

	(c)		We must have received from the master chargee of the land held under the master title
governing the property, if there is such a master chargee:

		(1)	a disclaimer in writing disclaiming any right, interest and title in respect of the property;
and

		(2)	an undertaking in writing to exclude the property from any foreclosure proceedings it may take
in respect of the land held under the master title governing the property.

	2.4.5		The Security Documents and all other documents which We consider are necessary to
protect Our interests must have been signed and delivered to Us.

	2.4.6		We must have received from any other relevant party all other documents which We consider
are necessary to protect Our interests.

	2.4.7		We must have received from Our solicitors an advice in writing confirming that the
security for the Facility is in place and that We may release the Facility or any part of the Facility.

3. IF SECURITY IS PROPERTY

 

	3.1		All moneys payable on the property which is charged or assigned to Us, such as quit
rent, assessment rates and maintenance charges, must be paid up to date; You must submit proof of payment to Us every year.

	3.2		If the property which is charged or assigned to Us is landed residential property,
a Houseowner's Policy will be taken up by Us on Your behalf at Your expense with an insurance company appointed by Us. The Policy
will be on a full reinstatement value basis up to the full insurable value and will cover loss and damage by fire, explosions,
riots, strikes, malicious damage and other perils as We consider necessary. We will be named as chargee and loss payee on the
Policy.

 

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	3.3		If the property which is charged or assigned to Us is landed commercial or industrial
property, a Fire Policy will be taken up by Us on Your behalf at Your expense with an insurance company appointed by Us. The Policy
will be on a full reinstatement value basis up to the full insurable value and will cover loss and damage by fire, explosions,
riots, strikes, malicious damage and other perils as We consider necessary. We will be named as chargee and loss payee on the
Policy.

	3.4		If the property which is charged or assigned to Us is covered by the Strata Titles
Act 1985, You must give us proof that the building where the property is in is insured against fire and such other risks as may
be prescribed in the Strata Titles Act 1985 under a master policy for its full reinstatement value. If You do not give us such
proof, a Houseowner's Policy will be taken up by Us on Your behalf at Your expense with an insurance company appointed by Us.
The Policy will be on a full reinstatement value basis up to the full insurable value and will cover loss and damage by fire,
explosions, riots, strikes, malicious damage and other perils as We consider necessary. We will be named as chargee and loss payee
on the Policy.

	3.5		You must not renovate or refurbish the property without first obtaining Our written
consent. We have the right not to give Our consent without giving You any reasons. If We do give Our consent, We have the right
to impose such terms and conditions as We deem fit which may include Your taking up of a Contractors' All Risk Policy for the
renovation or refurbishment work before the start of the work with an insurance company appointed by Us and with Us named as chargee
and loss payee. If you do not give Us proof acceptable to Us that You have taken up the Policy, We may arrange for insurance coverage
at Your expense by debiting your account without any reference to You.

	3.6		If the property is charged or assigned to some other party, We have the right to use
the Facility or any part of the Facility to pay the redemption sum to redeem the property. If We exercise this right, the acknowledgement
or receipt of that other party will be binding on You as if it was You who had received payment from Us.

	3.7		We also have the right to use the Facility or any part of the Facility to pay the
balance of the purchase price of the property to the vendor who sold You the property. If We exercise this right, the acknowledgement
or receipt of that other party will be binding on You as if it was You who had received payment from Us.

4.  IF SECURITY IS STOCKS
AND SHARES 

 

	4.1		The stocks and shares to be charged to Us are to be registered in the name of Our
nominee company.

	4.2		We have the absolute discretion to accept or reject any stocks and shares You offer
to Us as security without giving You any reasons. Even after stocks and shares have been charged to Us as the Security, We still
have the right to reject those stocks and shares and You will then be required to replace them with stocks and shares acceptable
to us.

	4.3		We are not responsible for the collection of any dividends or bonuses and for the
exercise of rights issues relating to the stocks and shares charged to Us.

5.  INTEREST

 

	5.1		Unless We expressly prescribe otherwise in Our sole discretion, interest for the Facility
must be paid to Us every month in arrears. If not paid when due, the interest will be added on to the principal amount of the
Facility owing and further interest will be charged on the unpaid interest until We have received all interest due to Us whether
or not We have obtained judgment against You in a court of law and whether or not You have ceased to be Our customer.

	5.2		Before You begin any repayment to us for a non-revolving Facility, that is, a Facility
which cannot be reused even if You have repaid any principal amount of the Facility, interest on the amounts of the Facility that
We release from time to time will be calculated on a daily basis and must be paid to Us every month in arrears. If not paid when
due, the interest will be added on to the principal amount of the Facility owing and further interest will be charged on the unpaid
interest until We have received all interest due to Us whether or not We have obtained judgment against You in a court of law
and whether or not You have ceased to be Our customer.

	5.3		Interest rates may be varied from time to time at Our sole discretion and any new
interest rate will apply and be payable by You as from the date specified in a written notice which We will give to You. We reserve
the right not to give You any notice if the variation of interest rates relates only to the variation on the Bank's Base Lending
Rate.

6.  COMMITMENT FEE

 

	6.1		If the Facility is an overdraft, We have the right to charge a commitment fee of one
per centum (1%) per annum on the unutilised portion of the Facility at the end of every month or at such other time interval as
We may stipulate. The fee will be payable monthly in arrears. If not paid when due, the fee will be added on to the principal
sum then owing and will from that time bear interest at the rate prescribed by Us.

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7.     COSTS
AND EXPENSES

 

	7.1		You are to pay for all the costs and expenses of:

	7.1.1		providing, maintaining, protecting and realising the Security; and

	7.1.2		processing, implementing and recovering moneys owing under the Facility.

	7.2		The costs and expenses are to be paid on a full indemnity basis.

	7.3		Interest at a rate to be prescribed by Us is payable on the costs and expenses from
the date they are incurred until full payment.

	7.4		If the Facility is cancelled for any reason whatsoever before any part of it has been
utilised, You will still have to pay for all costs and expenses which may already have been incurred in relation to the providing
of the Facility and the preparation of the Security Documents.

	7.5		For the avoidance of doubt, the costs and expenses payable by You includes the costs
and expenses of Our solicitors.

8.    
RIGHT TO DEBIT

 

	8.1		Without affecting any other rights that We may have, We may, at any time, at our sole
discretion, and without giving You any prior notice, debit Your account current or any other account (including the balance on
any overdraft account) which You may have with Us with any moneys whatsoever which is payable by You to Us.

	8.2		If We do debit Your account, the debiting is not to be taken as a waiver of any of
the Events of Default listed in these Terms and Conditions.

	8.3		If any debiting of Your account causes Your account to be overdrawn, interest at the
default rate shall be payable accordingly.

9.    
NON-WAIVER

 

	9.1		If You breach any of the terms and conditions governing the Facility or any security
for the Facility, We may at our sole discretion decide not to exercise any right which We may have in relation to Your breach.

	9.2		Any decision of Ours not to exercise any right which We may have in relation to Your
breach is not to be treated as a waiver of Our rights and We retain the right at any time afterwards to strictly enforce or to
insist on Our rights in relation to that breach or any subsequent breach by You.

10.   FINANCIAL STATEMENTS
AND INFORMATION

 

	10.1		If You are a company, You are to deliver to Us on request all statements, information,
materials and explanations relating to your business and financial position including Your Annual Audited Financial Statements
and Directors' and Auditors' Report which are to be delivered within thirty (30) days of the close of each of your financial years
or within such longer period as We may allow.

11.   REORGANISATION
OR CHANGES IN MEMORANDUM AND ARTICLES OF ASSOCIATION

 

	11.1		If You are a company, You must not without Our prior written permission, undertake
or allow any reorganisation, amalgamation, reconstruction, take-over, substantial change of shareholders or Your management or
any other schemes of companies or arrangement affecting Your present constitution or residential status or amend or alter any
of the provisions in Your Memorandum and Articles of Association relating to Your borrowing powers and principal business activities.

12.   CHANGE IN CONSTITUTION

 

	12.1		If you are a company, these Terms and Conditions and all the provisions governing
the Facility and the Security will continue to be valid and binding on You even if there is any change in Your constitution or
Memorandum and Articles of Association by amalgamation, consolidation, reconstruction or otherwise.

	12.2		If you are a firm, these Terms and Conditions and all the provisions governing the
Facility and the Security will continue to be valid and binding on You even if there is any change in Your constitution by retirement,
expulsion, death, admission, accession or change of any of the partners or otherwise.

13.   RIGHT OF SET-OFF

 

	13.1		We have the right, without any notice to You, to combine, consolidate or merge all
or any of Your accounts and liabilities with and to Us whether singly or jointly with any other person. We also have the right,
after giving You seven (7) days' notice, to transfer or set off any sums in credit in such accounts in or towards the satisfaction
of any of Your liabilities to us, whether actual or contingent primary or collateral joint or several.

 

 

 

    	17

    	 

    
 

 

 

	13.2		If any of Your liabilities is contingent, We have the right to set-off and transfer
any sum standing to the credit of any of Your accounts towards satisfaction of Your contingent liabilities and if Your actual
liabilities are less than the amount set-off by Us, We will refund the surplus to You.

	13.3		If any of Your accounts in credit is maintained in a currency other than the currency
of the liabilities, We may convert them into the currency of the liabilities at Our own prevailing rate.

14. EVENTS OF DEFAULT

 

	14.1		When an Event of Default happens:

	14.1.1		We will not be under any further obligation and/or commitment to You in relation to
the Facility;

	14.1.2		all moneys and interest then owing to Us under the Facility and any other moneys then
owing to Us by You will immediately become payable on demand by Us;

	14.1.3		We will immediately become entitled to recover all moneys and interest then owing
to Us with interest thereon at the rate of three point five per centum (3.5%) per annum above Our prevailing Base Lending Rate
with monthly rests or at such other rate and/or other periodic rests as We may at Our sole descretion prescribe from time to time;
and

	14.1.4		We will be entitled to exercise any right or power:

	(a)		which We may have upon an Event of Default by virtue of these Terms and Conditions
and the Security Documents; and

	(b)		which may be available to Us in law; without any previous notice to you. 14.2 The
following are the Events of Default referred to in Clause 14.1:

	14.2.1		if You fail to pay on any due date any money which You should be paying to Us or if
You fail to discharge any obligation or liability owing to Us;

	14.2.2		if You, or any Security Party, fail to observe or perform any of the terms and conditions
contained in these Terms and Conditions or the Security Documents;

	14.2.3		if You, or any Security Party, die or become insane;

	14.2.4		if You, or any Security Party, become bankrupt or insolvent or allow any judgment
to remain unsatisfied for a period of twenty-one (21) days;

	14.2.5		if You, or any Security Party, commit any act of bankruptcy or are unable to pay Your
or its debts, as the case may be, or suspend the payment of Your or its debts, as the case may be, or enter into any composition
or arrangement with or for the benefit of Your or its creditors, as the case may be;

	14.2.6		if any resolution is passed, or if a petition is presented against You, or any Security
Party;

	(a)		for bankruptcy, liquidation, winding-up or dissolution; or

	(b)		for the appointment of a liquidator, receiver, trustee or judicial manager;

	14.2.7		if a liquidator, receiver, trustee, judicial manager or a similar official is appointed
for all or a substantial part of Your assets or the assets of any Security Party;

	14.2.8		if execution or any form of recovery or enforcement action is levied or taken against
any of Your assets or the assets of any Security Party;

	14.2.9		if You, or any Security Party, stop or threaten to stop carrying on Your or its business,
as the case may be;

	14.2.10		if You, or any Security Party, change or intend to change the nature or scope of Your
or its business as is presently conducted, as the case may be;

	14.2.11		if You, or any Security Party, transfer or dispose of or intend to transfer or dispose
of a substantial part of Your or its assets, as the case may be;

	14.2.12		if, in Our opinion, there is any change or threatened change in:

	(a)		circumstances which would materially and adversely affect Your or any Security Party's
business or financial condition or Your or its ability to perform Your or its obligations under these Terms and Conditions or
the Security Documents;

 

    	18

    	 

    
 

 

 

	(b)		Your status or the status of any Security Party as a resident or resident controlled
company, as the case may be; or

	(c)		Your shareholders, shareholding structure, directors or management, if You are a company;
or

	(d)		the shareholders, shareholding structure, directors or management of any Security
Party, if it is a company;

	14.2.13		if, at any time after We have agreed to grant You the Facility, laws and regulations
governing Us make it unlawful for Us to grant or to continue to grant You the Facility or to comply with Our obligations under
any agreement We have with You in relation to the Facility;

	14.2.14		if a notice or proposal for the compulsory acquisition of any of Your properties or
the properties of any Security Party is issued or made under any law;

	14.2.15		if You, or any Security Party, are blacklisted pursuant to the Dishonoured Cheques
Information System (DCHEQS) guidelines or any guidelines issued by Bank Negara Malaysia or any other authority having jurisdiction
over Us;

	14.2.16		if Your account with Us is redesignated or closed by Us for any reason whatsoever;

	14.2.17		if You, any Security Party or any Associated Party fails to discharge any obligation
or liability to Us or to any other person;

	14.2.18		if You, any Security Party or any Associated Party, commit a default in any loan,
facility or similar arrangement with any person, (including Us) which gives the right to the creditor concerned (including Us)
the right to demand repayment of the loan, facility or arrangement before its due date, to withdraw the loan, facility or arrangement;
or to enforce the security for the loan, facility or arrangement;

	14.2.19		if there is a default in the payment of any moneys under the account of any other
person for whom You, any Security Party or any Associated Party, are providing security; or

	14.2.20		if We decide in Our sole discretion that the continuation of the Facility could likely
be detrimental to Our own position or that Our security position could be in jeopardy; Our discretion is final and is not subject
to query by You.

15. DISCLOSURE OF INFORMATION

 

	15.1		You agree that We (including Our officers, employees, agents or any other persons
to whom We grant access to Our records, correspondence or any material relating to You or Your account) can disclose at any time
at Our sole discretion without notifying You beforehand, any information relating to You, Your account and any of Your Authorised
Persons to the following:

	15.1.1		any one or more members of Our Group for any of the following purposes:

	(a)		providing You with banking services;

	(b)		reporting;

	(c)		data matching;

	(d)		promoting, improving and furthering the provision of other services by Us or any member
of Our Group to You;

	(e)		fraud or crime prevention;

	(f)		investigating, preventing or otherwise in relation to money laundering or any other
criminal activities;

	(g)		debt collection;

	(h)		outsourcing Our operations;

	(i)		performance of duties as an officer of the bank or in connection with the conduct
of audit or the performance of risk management;

	(j)		facilitating the performance of Our or any member of Our Group's functions;

	(k)		compliance with Our Group's policies, guidelines, directives or requirements;

	(I)		corporate exercise;

	(m)		any legal process initiated by or served on Us;

 

    	19

    	 

    
 

 

 

	15.1.2		any person, whether in Malaysia or elsewhere, who provides electronic or other services
to Us for the purpose of providing, updating, maintaining and upgrading the services including, but not limited to, investigating
discrepancies, errors or claims;

	15.1.3		any person, whether in Malaysia or elsewhere, engaged by Us in connection with the
performance of services or operational functions which have been out-sourced;

	15.1.4		the police or any public officer conducting an investigation in connection with any
offence including suspected offences;

	15.1.5		credit card companies and financial institutions in connection with credit card enquiries;

	15.1.6		other banks, financial institutions, credit bureau or credit reference agents (only
for credit information);

	15.1.7		Our auditors, solicitors, and professional advisors;

	15.1.8		Our stationery printers, vendors of the computer systems We use, and to such persons
installing and maintaining them and other suppliers of goods or service providers We engage;

	15.1.9		any receiver appointed by Us or by any other party;

	15.1.10		any credit bureau of which We are a member, and any other members and/or compliance
committee of such credit bureau;

	15.1.11		any rating agency, insurer or insurance broker or direct or indirect provider of credit
protection;

	15.1.12		any actual or potential participant or sub-participant in relation to any of Our obligations
under the banking agreement between You and Us, or assignee, novatee or transferee (or any officer, employee, agent or adviser)
of any of them;

	15.1.13		for transactions effected or processed with or without Your authority in or through
the automated teller machines of other banks or financial or non-financial institutions or terminals or other card operated machines
or devices We approve, to the bank, financial institution or non-financial institution, trader or other party accepting the use
of the automated teller machine card and their respective agents or contractors;

	15.1.14		any court, tribunal or authority, whether governmental or quasi-governmental with
jurisdiction over Us or any member of Our Group;

	15.1.15		any person to whom We, or any member of Our Group, are permitted or required to disclose
to under the laws of any country;

	15.1.16		any other person to whom such disclosure is considered by us to be in our interest,
or the interest of any members of our Group;

	15.1.17		any person intending to settle any moneys outstanding under the Facility;

	15.1.18		any person connected to the enforcement or preservation of any of Our rights under
these Terms and Conditions and the Security Documents;

	15.1.19		the Central Credit Bureau or any other authority or body established by Bank Negara
Malaysia or any other authority having jurisdiction over Us;

	15.1.20		any Security Party.

16. COMPLIANCE WITH COURT ORDERS

 

	16.1		We and Our Group can act in any way We see fit, without consulting You beforehand,
if We are served with a court order issued by a court of any jurisdiction. You agree that You will not hold Us liable for any
loss or damage in connection with Our actions.

17. SECURITY MARGIN

 

	17.1		If the market value of any security falls below what We in Our sole discretion consider
to be adequate security for the Facility, We may do any one or more of the following without affecting any other right which We
may have:

	17.1.1		reduce the credit limit of the Facility;

	17.1.2		withhold further release or utilisation of any part of the Facility;

    	20

    	 

    
 

 

 

	17.1.3		require You to make repayment of such amount of the Facility as We may decide upon;

	17.1.4		require You to make prepayment of the Facility in which case We will not charge You
any prepayment fee; and/or

	17.1.5		require additional security to be furnished for the Facility.

18.     
APPLICATION OF MONEYS

 

	18.1		If any money paid to Us or recovered by Us in respect of your liabilities under the
Facility is less than the amount then owing to Us, We may at Our sole discretion apply the money towards payment of interest,
fees, principal or any amount due to Us in such proportions and order and generally in such manner as We consider fit; We may
also choose to credit the money or some of it into a non-interest bearing suspense account.

19.     
LEGAL ADVICE

 

	19.1		You are advised to seek independent legal advice before accepting the Facility and
before signing the Facility Letter and the Security Documents prepared by Us or Our solicitors.

20.     
CERTIFICATE

 

	20.1		Any certificate or statement issued by Us showing the outstanding amount due and owing
from You to Us in relation to the Facility will be conclusive proof as to the outstanding amount due and owing from You to Us
in relation to the Facility; this certificate or statement will be binding on You for all purposes whatsoever including for the
purposes of any legal proceedings.

21.     
GOVERNING LAW

 

	21.1		The Facility Letter and these Terms and Conditions are to be governed by and interpreted
in accordance with the laws of Malaysia and, upon Your acceptance of the Facility, you are deemed to have unconditionally and
irrevocably:

	21.1.1		agreed that any dispute involving the Facility Letter and these Terms and Conditions
may be submitted to the courts of law within and outside of Malaysia;

	21.1.2		agreed not to raise any objection to any dispute being submitted in any particular
court of law on the basis that it is not the correct or most convenient court for the dispute to be submitted to; and

	21.1.3		consented to the service on You of any demand by Us and of any court documents by
registered mail or by any other manner allowed by the relevant laws.

22.     
PRESERVATION OF RIGHTS AND ENTITLEMENT

 

	22.1		Regardless of what is stated anywhere else in these Terms and Conditions or the Security
Documents, Our rights as stated in these Terms and Conditions or the Security Documents will continue to remain in full force
and effect and shall survive any cancellation, revocation or suspension of the Facility by Us.

23.     
FACILITY CALLABLE ON DEMAND

 

	23.1		Unless the Facility is a Term Loan, Fixed Loan or a Customer Housing Loan, the Facility
will be callable on demand by Us at Our sole discretion; this means that We have the right to terminate or cancel the Facility
at any time and to require You to make immediate payment and repayment of all moneys and liabilities owing by You to Us in relation
to the Facility regardless whether the moneys and liabilities have become due to be paid or repaid to Us.

24.     
VARIATION

 

	24.1		These Terms and Conditions, the Security Documents, and the availability, limits,
interest rates, commission, fees and charges of and relating to the Facility are subject to:

	24.1.1		guidelines issued from time to time by Bank Negara Malaysia or any other authority
having jurisdiction over Us; and

	24.1.2		Our review and variation from time to time at Our sole discretion.

	24.2		If there is a change in any fees and charges, we will give You twenty-one (21) days'
prior notice before the change takes effect.

    	21

    	 

    
 

 

25.   

NOTICES

 

	25.1		You must notify Us in writing of any change in Your address, facsimile number, electronic
mail address or mobile phone number.

	25.2		Anything whatsoever that We send to You may be:

	25.2.1		delivered by hand to Your address as stated in the Facility Letter or such other address
last known to Us;

	25.2.2		sent by pre-paid ordinary post to Your address as stated in the Facility Letter or
such other address last known to Us;

	25.2.3		sent by facsimile transmission to the facsimile number last known to Us; 25.2.4 sent
by electronic mail to the electronic mail address last known to Us;

	25.2.5		sent by short message system (SMS) to the mobile phone number last known to Us; 25.2.6
by posting on Our website; or

	25.2.7		by insertion in any statement of account which We send to You.

	25.3		Anything whatsoever that We send to You will be deemed to have been received by You,
that is, regardless of whether You have actually received whatever we sent:

	25.3.1		at the time of delivery at Your address, if delivered by hand;

	25.3.2		forty-eight (48) hours after posting, if sent by pre-paid ordinary post and if we
can show that whatever We sent was properly posted and correctly addressed to You;

	25.3.3		at the time the facsimile transmission is completed; 25.3.4 at the time the electronic
mailing is completed;

	25.3.5		at the time the sending by short message system (SMS) is completed; 25.3.6 at the
time of posting on Our website; or

	25.3.7		at the time the statement of account is deemed to have been received by You.

	25.4		Our rights under these Terms and Conditions and the Security Documents are not to
be affected by any failure on Your part to notify Us of any change in Your address, facsimile number, electronic mail address
or mobile phone number.

	25.5		We also reserve the right to serve on You any notice in connection with the Facility
or the Security by advertisement in any one daily newspaper and such notice will be deemed to have been served on You on the day
the advertisement appears in the newspaper regardless of whether You have actually seen the advertisement.

 26. SEVERABILITY

 

	26.1		If any of these Terms and Conditions is or becomes invalid or unenforceable, the invalid
or unenforceable Term and Condition is to be treated as not having been included in these Terms and Conditions; the remainder
of these Terms and Conditions is to continue to be effective and in force and is not to be affected in any way by the invalid
or unenforceable Term and Condition.

 27. MARKET DISRUPTION

 

	27.1		Regardless of whatever is stated in these Terms and Conditions or any Security Document,
We may at any time and from time to time, at Our sole discretion and without having to give You any reason, cancel or suspend
the Facility by notice in writing to You if in Our sole opinion there is any change in national or international monetary, financial,
political or economic conditions, or currency exchange rates which would cause the continuation of the Facility to be temporarily
or permanently not practical or not possible from a commercial point of view.

 28. CIRCUMSTANCES BEYOND OUR CONTROL 

 

	28.1		If We are unable:

	28.1.1		to perform any of Our obligations under these Terms and Conditions or any Security
Document;

    	22

    	 

    
 

 

	28.1.2		to carry out Our usual business operations; or 28.1.3 to provide any service; due
to any reason beyond Our control including, but not limited to:

 

	(a)		any fire, earthquake, flood, epidemic, natural disaster, accident, riot, civil disturbance,
industrial dispute, act of terrorism, embargo, war or Act of God;

	(b)		any failure of or interruption to telecommunications, internet, electricity, water
or fuel supply; or

	(c)		any circumstances in the nature of a force majeure, that is, an unforeseeable
event that prevents Us from performing any of Our obligations under these Terms and Conditions or any Security Document;

We will not be in any way liable for any failure
to perform or for any inconvenience, loss, injury or damage which You may directly or indirectly suffer as a result.

29. INCREASED COSTS

 

	29.1		If We in our sole discretion decide that, as a result of any new law, guideline, directive
or regulation, or as a result of any change to any existing law, guideline, directive or regulation:

 

	29.1.1		We would incur increased costs because of having granted You or continuing to grant
You the Facility and having to continue to perform Our obligations under the Facility or the Security Documents;

	29.1.2		We would not be able to obtain the rate of return on Our overall capital which We
would have been able to obtain if not for Our having granted You or continuing to grant You the Facility and having to continue
to perform Our obligations under the Facility or the Security Documents;

	29.1.3		any sum received or receivable by Us under the Security Documents is reduced (except
for tax on Our overall net income);

	29.1.4		there is an increase in the costs to Us of paying for or maintaining Your use of the
Facility; or

	29.1.5		We have to make any payment (except for tax on Our overall net income) or forgo any
interest or other payment to Us on the basis of any sum repayable or to be paid to Us under the Facility or the Security Documents;

You will have to pay to Us upon demand by Us an amount
sufficient to make good:

 

	(a)		the increased costs, the reduced return and the reduced sum suffered by us;

	(b)		the payment We have to make; and

	(c)		the interest or other payment which We have to forgo.

30. PREPAYMENT

 

	30.1		If We allow You to prepay the Facility, that is, to repay to Us in full the amount
owing to Us under the Facility and the Security Documents, at any time before the amount owing to Us is due to be repaid, You
will have to pay to Us a prepayment fee plus an amount to compensate Us for any loss which We may suffer as a result of Your prepayment;
the fee and the amount will be decided upon by Us at Our sole discretion.

31. CONVERSION OF FOREIGN CURRENCY FACILITY

 

	31.1		If the Facility is a foreign currency facility, We can at our sole discretion convert
the Facility to a Ringgit Malaysia facility upon such terms as We may in our sole discretion prescribe.

32. PREVAILING DOCUMENT

 

	32.1		If there is any inconsistency between these Terms and Conditions and the terms and
conditions contained in the Facility Letter, the terms and conditions contained in the Facility Letter will prevail, that is,
the terms and conditions contained in the Facility Letter will take precedence.

 

    	23

    	 

    
 

 

33. DEFINITIONS AND INTERPRETATION

 

	33.1		When used in these Terms and Conditions:

	33.1.1		"Associated Party" means any of the following:

	(a)		Your director;

	(b)		Your shareholder;

	(c)		a company of which any of Your directors is a director or a shareholder;

	(d)		a company of which any of Your shareholders is a shareholder or a director;

	(e)		Your parent or holding company;

	(f)		Your subsidiary company;

	(g)		a company of which You are directly or indirectly a shareholder;

	(h)		a partnership of which You are a partner;

	(i)		a sole-proprietorship of which You are a proprietor;

	(j)		a company of which You are a director;

	33.1.2		"Authorised Persons" means any person You authorise (either alone
or collectively), and approved by Us, to operate Your account, and to act on Your behalf in giving instructions, to perform any
acts under an agreement between You and Us, or to use any facility, product or service We make available to You;

	33.1.3		"Base Lending Rate" means the rate of interest (fixed by Us from
time to time based on guidelines issued by Bank Negara Malaysia from time to time) which is reflective of the total cost to Us
for maintaining the Facility plus a margin of profit We are allowed to include by Bank Negara Malaysia or any other authority
having jurisdiction over Us;

	33.1.4		"Facility Letter" means the letter from the Bank to which these Terms
and Conditions are annexed;

	33.1.5		"Facility" means the banking facility offered to You in the Facility
Letter and refers to all the banking facilities if more than one banking facility is offered to You in the Facility Letter;

	33.1.6		"Group" means Our branches, agencies, representative offices, affiliated,
associated or related corporations, and their respective officers, servants or agents, whether situated in or out of Malaysia,
and includes Us;

	33.1.7		"Individual" means a human person (as distinguished from a company)
and includes a partner or partners of a firm or partnership;

	33.1.8		"Security" means the security or securities required to be created
in Our favour or given to Us in exchange for Our granting to You of the Facility; the Security is more particularly described
in the Facility Letter;

	33.1.9		"Security Documents" means any document relating to the Facility
and the Security and includes the Facility Letter and any Loan Agreement or Facility Agreement signed by You and Us;

	33.1.10		"Security Party" means any person creating or giving the Security
and can also mean You if You are the person creating or giving the Security;

	33.1.11		"We / Our I Ours I Us" means and refers to United Overseas Bank (Malaysia)
Bhd (Company No. 271809 K);

	33.1.12		"You / Your" means and refers to the person to whom the Facility
Letter is addressed; if the Facility Letter is addressed to more than one person, "You / Yours" refer to all
those persons jointly and severally so that the obligations and liabilities of those persons are also joint and several; and

	33.1.13		words and phrases applicable to natural persons (including the word "person")
also apply to non-natural persons such as companies, corporations, partnerships, firms and other bodies whether corporate or unincorporated.

 

 

 

    	24

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