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    LOTO
INC.

     

    FOUNDERS'
AGREEMENT

    

    THIS FOUNDERS' AGREEMENT (the
“Agreement”) is
made as of the date set forth on the signature page hereto by and among LOTO INC., a Nevada corporation
(the “Company”), A FEW BRILLIANT MINDS
INC. (the
“Inventor”) and
MHALKA CAPITAL INVESTMENTS
LTD. (“Mhalka,” and together
with the Inventor, the “Founders” and
together with the Company and the Inventor, the “Parties”).

    

    Whereas, Mobilotto Systems
Inc. (“Mobilotto”) is an
Ontario corporation that has a business model utilizing a proprietary software
application which allows for the encrypted purchase of lottery tickets on a
mobile device (the “Technology”);

    

    Whereas, as of the date
hereof, Mobilotto is the sole owner and holder of all intellectual property
rights pertaining to the Technology;

    

    Whereas, Mhalka is a company
whose principals have expertise in the areas of corporate development, finance,
investments, mergers, acquisitions and strategic business
alliances;

    

    Whereas, the Founders have
agreed that it is in their respective mutual best interests to enter into
strategic partnership in the form of the Company which was incorporated on April
22, 2009;

    

    Now, therefore, in
consideration of the mutual representations, warranties, covenants and
agreements set forth in this Agreement, the Parties hereto hereby agree as
follows:

    

    Section
1.                      Purchase and
Sale.

    

    1.1           Mhalka
hereby purchases twenty million (20,000,000) shares of Company Common Stock (the
“Mhalka
Shares”) in consideration for payment of the aggregate purchase price of
twenty thousand dollars ($20,000.00) at a per share purchase price of Company
Common Stock of $0.001 par value per share (the “Mhalka Purchase
Price”);

    

    1.2           The
Inventor hereby purchases twenty million (20,000,000) shares of Company Common
Stock (the “Inventor
Shares”) in consideration of the contribution to the Company of all of
the issued and outstanding equity interests of Mobilotto (the “Mobilotto Shares”),
the value of which is twenty thousand dollars ($20,000.00) at a per share
purchase price of Company Common Stock of $0.001 par value per share (the “Inventor Purchase
Price”).

    

    1.3           Prior
to the Closing the Inventor shall have completed the assignment and transfer of
all of the Intellectual Property, as such term is defined below, to
Mobilotto.

    
      
         

      

      
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    1.4           The
Parties intend that the purchase of the Mhalka Shares and the Inventor Shares
(collectively referred to herein as the “Company Shares”) and
the transfers of the Mobilotto Shares and Intellectual Property shall constitute
transactions in which no gain or loss is recognized in accordance with the
provisions of Section 351 of the Internal Revenue Code of 1986, as
amended.

    

    1.5           The
“Intellectual
Property” which the Inventor shall transfer to Mobilotto prior to the
Closing means all rights arising from or in respect of any of the following in
any jurisdiction throughout the world as relates to the Technology: (i) patents,
patent applications, patent disclosures and inventions, utility models,
supplementary protection certificates and applications therefore (including
provisional applications, invention disclosures, certificates of invention and
applications for certificates of invention) and divisionals, continuations,
continuations-in-part, patents of addition, reissues, renewals, extensions,
re-examinations, and equivalents thereof, including any continuations,
continuations-in-part, renewals and reissues for any of the foregoing, (ii)
Internet domain names, trademarks, service marks, service names, fictional
business names, trade dress rights, trade names, brand marks and names, slogans,
logos and corporate names and registrations and applications for registration
thereof together with all of the goodwill associated therewith, (iii) copyrights
(registered or unregistered, published and unpublished) and copyrightable works
and registrations and applications for registration thereof, and mask works and
registrations and applications for registration thereof, (iv) computer software,
(specifically excluding all shrink wrap software), data, data bases and
documentation thereof, (v) trade secrets and other confidential and proprietary
information (including ideas, formulas, compositions, inventions (whether
patentable or unpatentable and whether or not reduced to practice), know-how,
manufacturing and production processes and techniques, process technology,
research and development information, drawings, blue-prints, specifications,
designs, plans, proposals, technical data, copyrightable works, financial and
marketing plans and customer and supplier lists and information), (vi) copies
and tangible embodiments thereof (in whatever form or medium); URLs and internet
domain names, and all other intellectual property, industrial rights or
proprietary rights (however defined); in each case, owned, used, or licensed by
the Inventor as licensee or licensor.

    

    Section
2          Closing.

    

    The
purchase and sale of the Company Shares shall occur at a Closing to be held
contemporaneously with the execution hereof (the “Closing
Date”).  At the Closing, Mhalka is hereby delivering the Mhalka
Purchase to the Company and the Company is issuing the Mhalka Shares registered
in the name of Mhalka.  At the Closing, the Inventor is hereby
assigning, transferring and delivering the Inventor Purchase Price to the
Company and the Company is issuing the Inventor Shares registered in the name of
the Inventor.

    

    Section
3.         Corporate
Governance.

    

    3.1.           Composition of the
Board.  The Board of Directors of the Company (the “Board”) shall be
composed of an equal number of persons nominated by each Founder.  All
Founders: (i) shall accept such nominations as exclusive and binding as and when
made; and (ii) shall vote only for such persons nominated by the Founders,
respectively, so that the Board at all times consists of an equal number of
representatives of each Founder.  If for any reason at any time the
Board is not composed of an equal number of persons nominated by each Founder,
no actions may be taken by the Board other than duly appointing or duly electing
a nominee of the Founder then having the right to equalize representation on the
Board with such Founder’s nominees.

    
      
         

      

      
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    3.2.           Vacancies;
Removal.

    

    (a)           If
one of the directors shall cease to serve as a director of the Company for any
reason, including without limitation any of the reasons set forth in Section
3.2(b) below, the vacancy resulting thereby shall be filled by another person
nominated by the Founder who appointed such vacating director, with the same
full force and effect as set forth in Section 3.1 above.

    

    (b)           Except
as provided in this Section 3.2 each Founder agrees that, at any time that it is
then entitled to vote for the election or removal of directors, it will not vote
in favor of the removal of a director appointed by a Founder unless: (i) the
nominating Founder of such director has recommended such removal or the
nominating Founder of such director has waived Section 3.2(a) of this Agreement;
(ii) such director has been found by a court of competent jurisdiction or
arbitral body to have acted in a manner constituting gross negligence or willful
misconduct in his or her capacity as a director of the Company; or (iii) the
Board determines in good faith on the basis of reasonable independent evidence
that such director is impaired from properly performing his or her duties by
reason of any physical or mental incapacity for a period of more than ninety
(90) consecutive days in any six month period.

    

    3.3.           Cooperation.  Each
Founder shall vote all of its shares of common stock of the Company (the “Common Stock”) and
shall take all other necessary or desirable actions within its control
(including, without limitation, attending all meetings in person or by proxy for
purposes of obtaining a quorum, executing all written consents in lieu of
meetings and voting to remove members of the Board, as applicable), and the
Company shall take all necessary and desirable actions within its control
(including, without limitation, calling special Board and shareholder meetings
and voting to remove members of the Board, as applicable), to effectuate the
provisions of this Section 3.

    

    Section
4.        Restrictions on Transfers of
Stock.

    

    4.1.           A
Founder may transfer his Common Stock to only as follows (such transfers are
referred to herein as “Permitted Transfers”)
(i) to their estate in the event of death; (ii) to such Founder's spouse or
issue; (iii) to a trust for the benefit of such Founder’s spouse or issue; (iv)
to a family partnership, limited liability company or similar entity of which
the Founder is the only member; (v) to an “affiliate” of such Founder, which
term shall include any person who, directly or indirectly, through one or more
intermediaries, controls, is controlled by, or is under common control with such
Founder; or (vi) to any other person or entity in circumstances where such
transfer is necessary for purposes of regulatory compliance, tax efficiencies or
estate planning, and where the other Founder has consented to such transfer,
which consent shall not be unreasonably withheld.

    
      
         

      

      
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    4.2           As
a condition to any Permitted Transfer, unless otherwise agreed by unanimous
consent of the Founders, the Founder shall retain by irrevocable written proxy
all rights contained herein to nominate, vote for directors or vote for removal
of directors of the Company, and shall not permit any and all such rights to be
exercised by any other persons or legal entities other than the
Founder.  In the event of the Founder’s incapacity or death, the
Founder’s legal estate, legal custodian or legal guardian shall retain all such
Founder rights.

    

    4.3           No
Founder shall transfer any shares of Common Stock, whether owned on the date
hereof or acquired hereafter, other than in a Permitted Transfer, without the
prior unanimous written consent of the Founders.

    

    4.4.           Any
transferee of Common Stock (including any transferee pursuant to a Permitted
Transfer) who is not a Founder shall upon consummation of and as a condition to
such transfer, execute and deliver to the Company an agreement in form and
substance satisfactory to the Founders, pursuant to which it agrees to be bound
by the terms of this Agreement for the benefit of the Parties hereto and such
transferee shall thereafter be deemed to be subject to the terms and conditions
of this Agreement, except that any and all rights to nominate, vote for
directors or vote for removal of directors shall not be transferred to any such
transferee and the Founder shall retain all such rights, as provided in Section
4.2 above.

    

    4.5.           Any
transfer or attempted transfer of Common Stock in violation of any provision of
this Agreement shall be null and void, and the Company shall not record such
transfer on its books or treat any purported transferee of such Common Stock as
the owner of such Common Stock for any purpose.

    

    Section
5.        Right of First
Refusal.

    

    5.1.           Except
with respect to Permitted Transfers, in the event of any proposed transfer or
series of proposed transfers of Common Stock to a third party by any Founder (in
each case, a “Selling
Founder”), the following shall apply if and only if the other Founder
consents to such transfer:

    

    (a)           The
Selling Founder shall give the other Founders (each, a “First Offeree”) and
the Company written notice of its intent to transfer all or portion of its
Common Stock (the “First Offer Notice”)
and the minimum price and terms and conditions of such transfer, and offer to
sell such Common Stock to the First Offeree.

    

    (b)           Following
receipt of a First Offer Notice, a First Offeree may purchase such Common Stock
proposed to be sold pro rata at the percentage of Common Stock then held by such
First Offeree, which proportion shall be determined with respect to all Founders
of the Company as if the Selling Founder had no Common Stock of the
Company.

    

    (c)           If
the First Offeree shall not, within 30 days after receipt of the First Offer
Notice accept the offer contained therein, then subject to Section 4 the Selling
Founder shall be free to sell the interests specified in the First Offer Notice,
at a price and on other terms and conditions no less favorable than those
specified in the First Offer Notice, at any time within 30 days following the
expiration of the such First Offer 30-day period, after which the provisions of
the First Offer must be re-initiated.

    
      
         

      

      
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    (d)           If
the Selling Founder shall not have consummated the proposed transfer within 120
days after the expiration of the 30-day period referred to in clause (c) above,
the Selling Founder may not thereafter sell such Common Stock without again
complying with the First Offer Notice provisions hereof.

    

    (e)           If
the First Offeree shall accept such offer within 30 days after receipt of the
First Offer Notice, then the First Offeree shall purchase, for cash, the Common
Stock specified in such First Offer Notice as promptly as reasonably
practicable, but in no event later than 75 calendar days after receipt of the
First Offer Notice, or such later date as the Selling Founder may agree in
writing.

    

    (f)           In
the event that a First Offeree declines to purchase all or any portion of
Selling Founder’s Common Stock pursuant to a First Offer Notice, then other
First Offerees may purchase any or all of such declined Common Stock pro rata as
set forth in clause (b) above.

    

    5.2.           Condition Precedent on
Transfer.  If any Founder shall transfer any Common Stock or
derivative interest therein to any person pursuant to the provisions hereof, it
shall be a condition precedent to such transfer that such transferee shall agree
in writing to be bound by the terms and conditions of this Agreement otherwise
such transfer shall be deemed to be null and void.

    

    Section
6.          Tag-Along
Rights.

    

    6.1.           Except
with respect to Permitted Transfers, no Selling Founder shall, in any one
transaction or any series of related transactions, directly or indirectly
transfer to a person who is not a party to this Agreement, any or all of its
shares of Common Stock unless (i) consent is granted by the other Founder; (ii)
the Selling Founder has complied with the Rights of First Refusal provided
herein; and (iii) the terms and conditions of such transfer to such third party
include an offer to each other Founder to include, at the option of such other
Founder, in such transfer, a number of shares of Common Stock owned by such
other Founder, determined in accordance with Section 6.2 hereof, on the same
terms and conditions as those applying to the Selling Founder.  Prior
to effecting any transfer of Common Stock subject to this Section 6, the Selling
Founder shall send a written notice of the terms of such proposed transfer (the
“Tag-Along
Notice”) to the other Founder, who for purposes of this Section 6 shall
not be deemed to be a Selling Founder, unless such other Founder initiates any
transaction or any series of related transactions (other than a Permitted
Transfer), directly or indirectly, with a view to transfer Common Stock to a
Person who is not a party to this Agreement.  At any time within 14
days after receipt of the Tag-Along Notice, each other Founder may accept the
offer included in the Tag-Along Notice for up to such number of shares of Common
Stock as is determined in accordance with the provisions of Section 6.2 by
furnishing written notice of such acceptance to the Selling Founder and
delivering to the Selling Founder the certificate or certificates representing
the shares of Common Stock to be transferred pursuant to such offer by such
other Founder.

    
      
         

      

      
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    6.2.           Each
Founder (other than the Selling Founder) shall have the right, pursuant to
Section 6.1 hereof, to sell pursuant to the third party's offer a number of
shares of Common Stock (rounded down to the nearest whole number of shares)
equal to the product of (A) the total number of shares of Common Stock to be
acquired by the third party, and (B) a fraction, the numerator of which shall be
the aggregate number of shares of Common Stock then owned by such Founder and
the denominator of which shall be the aggregate number of shares of Common Stock
then outstanding (the “Tag Along
Amount”).  The Selling Founder shall reduce the number of
shares of Common Stock it is to sell accordingly to allow for the Tag Along
Amount of shares of Common Stock of the other Founder to be sold.

    

    6.3.           Simultaneously
with the consummation of the transfer of the shares of Common Stock held by the
Selling Founder and any other Founder to the third party pursuant to the third
party's offer, the Selling Founder shall notify such other Founder thereof and
shall cause the third party purchaser to remit to such other Founder the total
sale price of the shares of Common Stock transferred by such other Founder to
such third party.  The Selling Founder may deduct from the sale price
payable to such other Founder pursuant to this Section 6 such other Founder's
pro rata portion of the reasonable out-of-pocket fees and expenses payable by
the Selling Founder in respect of the completion of such sale, including,
without limitation, brokers', legal and accounting fees and
expenses.

    

    6.4.           If
within 14 days after the receipt of the Tag-Along Notice, any Founder (other
than the Selling Founder) has not accepted the offer contained in the Tag-Along
Notice, such other Founder shall be deemed to have waived any and all rights
with respect to the transfer of shares of Common Stock described in the
Tag-Along Notice and the Selling Founder may for a period of 30 days from the
date of the Tag-Along Notice to transfer not more than the amount of shares of
Common Stock described in the Tag-Along Notice plus any shares of any other
Founder included in such transfer pursuant to this Section 6, on terms not more
favorable to the Selling Founder than those set forth in the Tag-Along
Notice.  If, at the end of such time period the Selling Founder has
not completed the transfer of shares of Common Stock held by the Selling Founder
and any other Founder in accordance with the terms of the third party's offer,
the Selling Founder shall return to all other Founders all certificates
representing the shares of Common Stock which such other Founder delivered for
sale or other disposition pursuant to this Section 6.  Any subsequent
transfer after the expiration of such 30 day period shall require re-initiation
of Tag-Along Notice.

    

    Section
7.          Conflicting
Agreements.  Each Founder represents and warrants that such
Founder has not granted and is not a party to any proxy, voting trust or other
agreement which is inconsistent with or conflicts with any provision of this
Agreement, and no holder of Common Stock shall grant any proxy or become party
to any voting trust or other agreement which is inconsistent with or conflicts
with any provision of this Agreement.

    
      
         

      

      
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    Section
8.            Covenants, Representations
and Warranties.

    

    8.1           Each
Party hereto represents and warrants to all other Parties hereto as
follows:

    

    (a)           The
Party has full power and authority to execute, deliver and perform its
obligations under this Agreement;

    

    (b)           This
Agreement has been duly and validly authorized, executed and delivered by the
undersigned Party, and constitutes a valid and binding agreement, enforceable
against such Party in accordance with the terms and conditions herein, except to
the extent that enforceability may be limited by bankruptcy, insolvency or other
similar laws affecting creditors' rights generally; and

    

    (c)           The
Party is not a signatory or adherent to any agreement which is inconsistent with
the rights of any party hereunder or otherwise conflicts with the provisions
hereof.

    

    (d)           The
Party is in good standing and is duly authorized under its respective charter
and constitutional governing instruments to execute and deliver this
agreement.  There is no order and no proceeding, investigation or
claim of any kind whatsoever, at law or in equity, pending or, to the Parties
knowledge, threatened against the Parties, which would give a third party the
right to enjoin or rescind the transactions contemplated by this Agreement or
otherwise prevent the Parties from complying with the terms and provisions of
this Agreement.

    (e)           The
Party does not require any governmental consent, approval, order or
authorization of, or registration, qualification, designation, declaration or
filing to execute, deliver and cause the effectiveness of this
Agreement.

    

    8.2           The
Inventor hereby covenants, represents and warrants to all other Parties hereto
as follows:

    

                                     (a)           The
Inventor is the sole beneficial and record owner of the Mobilotto Shares and has
good and marketable title to all Mobilotto Shares free and clear of all Liens
convertible rights, derivative rights, pre-emptive rights and contingent rights,
and the Company shall at the Closing acquire from the Inventor all of the
Inventor’s right, title and interest in and to the Mobilotto
Shares.  The Mobilotto Shares represent the sole equity ownership
interests in Mobilotto.  No other person has any right, title or
interest in the Inventor’s Mobilotto Shares, contingent or otherwise, or any
option or other right to acquire the Mobilotto Shares or claim of any direct or
indirect interests in the Mobilotto Shares, or any ownership or rights of any
nature or kind in any other issued or unissued securities or equity interests of
Mobilotto.  The Mobilotto Shares are not the subject of any domestic
consent decree or domestic relations order.  If the Mobilotto Shares
are marital property, the Inventor has fully disclosed the existence of this
Agreement to his spouse and obtained written consent for the sale of the
Mobilotto Shares hereunder.  Other than the transactions contemplated
by this Agreement, the Inventor has not entered into any agreement or letter of
intent or other commitment to acquire or dispose of any securities or assets of
Mobilotto.  For purposes of this Agreement “Lien” means any and
all liens, charges, mortgages, deeds of trust, pledges, easements, encumbrances
of any and all nature or kind, derivative third party rights and direct or
indirect contingent third party rights.

    
      
         

      

      
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                                    (b)           The
Inventor has not previously assigned, transferred, conveyed or otherwise
encumbered any of his rights, title or interests in any of the Intellectual
Property or the business plan developed for Mobilotto.  The Inventor
was the sole owner of the Intellectual Property prior to its transfer to
Mobilotto and no other persons or entities has or shall have any claim of
ownership with respect to any part of the Intellectual Property.  To
the best of the Inventor’s knowledge after reasonable investigation, no persons
are infringing any of the intellectual property rights of the Inventor in
connection with respect to the Technology and the Technology does not infringe
on any of the intellectual property rights of any other persons or
parties.   As of the Closing Mobilotto is in compliance with any
and all federal, state, provincial, regional, local or foreign law (including
common law), statute, code, ordinance, rule, regulation or other similar
pronouncement binding upon or affecting Mobilotto as adopted or issued by any
and all governmental authorities having competent jurisdiction over Mobilotto,
except where non-compliance would not materially or adversely affect the
Company.

    

                                    (c)           Prior
to the Closing, the Inventor shall have transferred to Mobilotto: (i) the
Intellectual Property, and all rights and all derivative rights thereof; and
(ii) any and all rights to the Mobilotto business model, in each case free and
clear of all Liens and Indebtedness. At the Closing Mobilotto shall be the sole
owner of all of the Intellectual Property, and all rights and all derivative
rights thereof free and clear of all Liens and Indebtedness.  For
purposes of this Agreement, “Indebtedness” means
(a) all liabilities and obligations for credit in advance of payment, borrowed
money or funded indebtedness or issued in substitution for or exchange for
borrowed money or funded Indebtedness (including obligations in respect of
principal, accrued interest, any applicable prepayment charges or premiums and
any unpaid fees, expenses or other monetary obligations in respect thereof); (b)
any indebtedness evidenced by any note, bond, debenture or other debt security;
(c) any lease obligations required to be capitalized in accordance with GAAP;
(d) all obligations for reimbursement then-required to be made as an obligor of
any banker’s acceptance or similar transactions (including, without limitation,
standby letters of credit and similar contingent sureties and guaranties); (e)
all obligations for the deferred purchase price of property, all conditional
sale obligations under any title retention agreement; (f) any obligations with
respect to the termination of any interest rate hedging or swap agreements; (g)
all obligations of the type referred to in clauses (a) through (f) of this
definition with respect to any Person for the payment of which either Company is
responsible or liable, directly or indirectly, as guarantor, obligor, surety or
otherwise (excluding intercompany debt); and (h) obligations of the type
referred to in clauses (a) through (g) of this definition with respect to other
Persons secured by any Lien on any property or asset of the
Company.

    

                                    (d)           As
of the Closing, the Inventor shall assume primary responsibility for payment of
any and all Mobilotto Indebtedness existing prior to Closing.  As of
the Closing Date, Mobilotto shall have no liabilities, contingent or otherwise,
with respect to any and all vendors, suppliers, employees, former employees,
contractors, consultants or professional service providers or any other accounts
of any nature or kind.

    
      
         

      

      
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                                    (e)           At
the Closing, the Inventor is hereby delivering the Mobilotto Shares to the
Company together with a duly executed stock power, whereby the Company shall
irrevocably become the sole legal and equitable owner of the Mobilotto
Shares.  At the Closing, there shall be no shall no direct or indirect
Liens or contingent Liens on any of the Mobilotto assets or the Mobilotto Shares
or the Intellectual Property.

    

    (f)           All
books and records of Mobilotto are true, correct and complete in all material
respects and shall continue to be maintained in accordance with good corporate
practice and as otherwise required pursuant to the laws, rules and regulations
applicable to the Company, and shall at all times be made available to all
directors of the Company and to each of the Founders and their respective
authorized representatives during ordinary business hours upon reasonable
notice.  The Inventor will execute any and all agreements, filings or
other documents necessary to document and record the transfer of the
Intellectual Property to the Company, as the Company may reasonably
request.

    

    (g)           The
Inventor hereby acknowledges that no employment relationship between the Company
and the Inventor is or will be created hereby.

    

    (h)           The
Inventor represents and warrants that Inventor is acquiring the Company Shares
for investment for Inventor's own account, not as a nominee or agent and not
with the view to, or for resale in connection with, any distribution
thereof.  The Inventor understands that the Company Shares have not
been, and will not be, registered under the Securities Act by reason of a
specific exemption from the registration provisions of the Securities Act that
depends upon, among other things, the bona fide nature of the investment intent
and the accuracy of such Inventor's representations as expressed herein.
Inventor has not been formed for the specific purpose of acquiring the Company
Shares. Inventor further understands that the Company shall have no obligation
to register the Company Shares under the Act on behalf of Inventor.

    

    8.3           Mhalka
hereby covenants and agrees as follows:

    

    (a)           At
the Closing, Mhalka is hereby paying the Mhalka Purchase Price for the Mhalka
Shares.

    

    (b)           Mhalka
hereby covenants and agrees to develop and execute strategic plans to obtain
operational financing for the Company in accordance with the budget mutually
agreed upon by the Founders and approved by the Board of
Directors.  The funds received by the Company in respect of the Mhalka
Purchase Price shall be utilized in accordance with Mhalka’s financing plans for
the Company.

    

    
      
         

      

      
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    8.4           Mhalka
and the Inventor hereby covenant and agree as follows:

    

    (a)           All
fees costs, expenses and disbursements of the Company after acquisition of
Mobilotto will be at the sole charge of the Company from proceeds of financing
activities.

    

    (b)           The
Inventor and Mobilotto will execute the operation and deployment of the
Technology according to the Mobilotto business plan and assure compliance with
all applicable governmental authorities and third parties necessary for legal
operation of the Technology.

    

    (c)           The
Parties will use their respective best efforts to obtain any and all approvals
from all government authorities and contract partners which may be applicable to
formation and commencement of operations of Mobilotto and the
Company.

    

    (d)           Mobilotto
shall after acquisition by the Company continue its operations and deploy its
business plan as a wholly owned subsidiary of the Company.  All
officers and employees of Mobilotto shall continue in their respective
capacities for Mobilotto.

    

    (e)           Neither
Mhalka nor Mobilotto nor any of their respective affiliates will grant any
contingent interests, pledges or options on Company Shares without the prior
unanimous consent of the Founders.  Any unauthorized pledge or option
shall be deemed null and void and shall not be recorded on the books and records
of the Company.

    

    Section
9.             Indemnification. From
and after the Closing, the Inventor shall indemnify the Company and Mhalka and
their respective directors, officers, employees, affiliates, stockholders,
agents, attorneys, representatives, successors and permitted assigns, against
and hold such Parties harmless from any and all loss or costs incurred by those
Parties in any action to defend the Company’s use of or rights to the Mobilotto
Shares, the Intellectual Property and Mobilotto’s business plan, which in any
such case is attributable to facts or circumstances which existed prior to the
Closing date.

    

    Section
10             Duration of Agreement;
Termination.  The rights and obligations of each Founder under
this Agreement shall terminate at such time as the Founders shall mutually
agree.

    

    Section
11.            Amendment and
Waiver.  Except as otherwise provided herein, no modification,
amendment or waiver of any provision of this Agreement shall be effective
against the Company or any Founder unless such modification, amendment or waiver
is approved in writing by all of the Founders.  The failure of any
party to enforce any of the provisions of this Agreement shall in no way be
construed as a waiver of such provisions and shall not affect the right of such
party thereafter to enforce each and every provision of this Agreement in
accordance with its terms.

    

    Section
12.            Severability.  Whenever
possible, each provision of this Agreement shall be interpreted in such manner
as to be effective and valid under applicable law, but if any provision of this
Agreement is held to be invalid, illegal or unenforceable in any respect under
any applicable law or rule in any jurisdiction, such invalidity, illegality or
unenforceability shall not affect any other provision or any other jurisdiction,
but this Agreement shall be reformed, construed and enforced in such
jurisdiction as if such invalid, illegal or unenforceable provision had never
been contained herein.

    
      
         

      

      
        Page 10
of 14

        
          

        

      

      
         

      

    

    

    
      	
              Loto Inc.

            	
              Founders'
  Agreement

            

    

    

    Section
13.          Entire
Agreement.  This agreement is the complete and entire agreement
and understanding among the Parties with respect to the subject matter hereof
and supersedes any and all prior understandings, agreements or representations
by or among the Parties, written or oral, which may have related to the subject
matter hereof in any way, including but not limited to the memorandum of
understanding contemplating this agreement.  Nothing in this Agreement
shall limit or impair the right of the Company or any Founder party to this
Agreement to enter amendments, into additional agreements regarding
supplemental terms and conditions applicable to ownership or rights pertaining
to the Common Stock in accordance with the terms and conditions of this
Agreement.

    

    Section
14.           Information and
Accounting.  The Company shall furnish the Founders and their
representatives with information concerning the business and operations of the
Company from time-to-time as determined by the Board.

    

    Section
15.           Governing
Law.  This Agreement shall be governed by and construed in
accordance with the laws of the jurisdiction of incorporation of the Company
without giving effect to the principles of conflicts of law.

    

    Section
16.            Dispute
Resolution.  Any controversy or claim arising out of or
relating to this Agreement, or the breach thereof, shall be settled exclusively
by binding arbitration in Toronto, Ontario, Canada pursuant to the rules of an
arbitral forum mutually agreed upon by the Founders.  In the event
that an arbitral forum is not agreed upon after delivery of notice by the
Founder initiating such arbitration and forty-five days after confirmed receipt
of such notice by the other Founder, then any court having competent
jurisdiction over the Founders shall have full power and authority to appoint an
arbitrator in Toronto, Ontario, Canada, who shall be a solicitor with not less
than ten years corporate transactional experience.  The fees and costs
of such arbitration shall be paid by the non-prevailing party.

    

    Section
17.             Confidentiality;
Non-Competition.  Each Founder acknowledges that all
information about the Company and its finances and operations is confidential
and proprietary and each Founder agrees not to disclose any such information to
any other person or entity, provided, however, that the foregoing shall not
limit or restrict the ability of any Founder who is also a director, officer or
employee of the Company from taking any actions necessary or appropriate to the
performance of its duties in connection therewith; provided, further, that each
Founder may disclose such information (1) to its affiliates, attorneys,
accountants, consultants and other professionals to the extent necessary to
utilize their services in connection with investment in the Company; or (2) as
may otherwise be required by law, provided that such Founder takes reasonable
steps to minimize the extent of any such required disclosure.  The
Parties hereto expressly agree that no Founder shall at any time engage in
business ventures or activities which directly compete with the Company's
business, and each Founder further agrees that the foregoing restriction shall
apply for a period of three (3) years following the date on which any person or
legal entity ceases to be a Founder of the Company.  Notwithstanding
the foregoing or anything to the contrary herein, the Parties hereto expressly
acknowledge and agree that each of the Parties hereto and their affiliates are,
or may in the future, be involved in other business activities and nothing
herein shall be interpreted to limit such other activities so long as such
activities do not directly compete against the Company.  The Parties
hereto and their respective affiliates may at any time engage in and possess
interests in other businesses and ventures of any and every nature and
description, independently or with others, however, neither Founder nor any
other person or affiliate of such Founder shall have any right, title or
interest in or to the other Founder’s independent activities or to the income or
profits derived therefrom.

    
      
         

      

      
        Page 11
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              Loto Inc.

            	
              Founders'
  Agreement

            

    

    

    Section
18.            
Legend.  Each
Founder and the Company shall take all such action necessary (including
exchanging with the Company certificates representing shares of Common Stock
issued prior to the date hereof) to cause each certificate representing
outstanding shares of Common Stock to bear restricted transfer legends
containing the following provision:

    

    THESE
SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE "ACT"). THEY MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN
THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT AS TO THE SECURITIES UNDER
THE ACT OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT SUCH
REGISTRATION IS NOT REQUIRED.

    

    THE
SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO THE RESTRICTIONS SET
FORTH IN THE FOUNDERS’ AGREEMENT A COPY OF WHICH IS ON FILE IN THE OFFICE OF THE
COMPANY.

    

    Section
19.              After-Acquired
Shares.  All of the provisions of this Agreement shall apply to
all of the shares of Common Stock now owned or hereafter issued or transferred
to a Founder or to its Permitted Transferees who have become a party to this
Agreement in connection with any additional issuance, purchase, exchange,
exercise of conversion rights or reclassification of shares of Common Stock,
corporate reorganization, or any other form of recapitalization, or
consolidation, or merger, or share split, or share dividend, or capitalization
issue, or which are acquired by a Founder in any other manner.

    

    Section
20.              Availability of Equitable
Remedies.  Each Founder acknowledges that a breach of the
provisions of this Agreement could not adequately be compensated by money
damages. Accordingly, each party hereto shall be entitled, in addition to any
other right or remedy available to it, to an injunction restraining such breach
or a threatened breach and to specific performance of any provision of this
Agreement, and in either case no bond or other security shall be required in
connection therewith, and the Parties hereto hereby consent to such an
injunction and to the ordering of specific performance.

    

    Section
21.              Notices. All notices
and communications to be given or otherwise to be made to any party to this
Agreement shall be deemed to be sufficient or contained in a written instrument
if sent by messenger, telecopied, faxed or mailed by registered or certified
mail, or by a recognized national or international courier service, postage or
charges prepaid, return receipt requested, to the addresses set forth on the
signature page hereto (or to such other address, as may be specified by the
Parties hereto from time to time).

    
      
         

      

      
        Page 12
of 14

        
          

        

      

      
         

      

    

    

    
      	
              Loto Inc.

            	
              Founders'
  Agreement

            

    

    

    Section
22.               Counterparts.  This
Agreement may be executed in separate counterparts each of which shall be an
original and all of which taken together shall constitute one and the same
agreement.  Signatures on this Agreement delivered electronically by
e-mail, scan, fax or telecopier shall be considered delivery of original
signatures for purposes of effectiveness of this Agreement to the same and full
extent as an original thereof.

    

    #           #           #

    
      
         

      

      
        Page 13
of 14

        
          

        

      

      
         

      

    

    

    
      	
              Loto Inc.

            	
              Founders'
  Agreement

            

    

    

    IN
WITNESS WHEREOF, the Parties hereto have executed this Founders' Agreement as of
this 13th day of
May, 2009.

    

    THE
COMPANY:

    

    LOTO
INC.

    

    
      
        	
                By:

              	
                /s/ Marsha Collins

              
	 
      	
                Name:  Marsha
      Collins

              
	 
      	
                Title:
      Corporate Secretary & Treasurer

              
	 
      	
                Address
      for Notices:

              
	 
      	
                United
      Corporate Services Inc.

              
	 
      	
                202
      South Minnesota Street

              
	 
      	
                Carson
      City, NV 89703

              

      

    

     

    THE
FOUNDERS:

    

    A
FEW BRILLIANT MINDS INC.

    

    
      
        
          
            	
                    By:

                  	
                    /s/
      Gino Porco

                  
	 
      	
                    Name:
      Gino Porco

                  
	 
      	
                    Title:

                  
	 
      	
                    Address
      for Notices:

                  
	 
      	
                    81
      CHARTWELL RD

                  
	 
      	
                    TORONTO,
      ONTARIO

                  
	 
      	
                    M8Z
      4G8

                  
	 
      	
                    CANADA

                  

          

        

      

    

    

    MHALKA CAPITAL INVESTMENTS
LTD.

    

    
      
        
          
            	
                    By:

                  	/s/
      Perpetum Finance Inc.
	 
      	
                    Name:
      Perpetum Finance Inc.

                  
	 
      	
                    Title:
      Director

                  
	 
      	
                    Address
      for Notices:

                  
	 
      	
                    c/o
      Alyco Advisory AG

                  
	 
      	
                    Stockerstrasse
      44/46

                  
	 
      	
                    PO
      Box 1502

                  
	 
      	
                    8027
      Zurich

                  
	 
      	
                    Switzerland

                  

          

        

      

    

    
      
         

      

      
        Page 14
of 14Unassociated Document

    LOTO
INC.

    

    SUBSCRIPTION
AGREEMENT

    (Regulation
S)

    

    Common
Stock

    

    US$0.01 Per Share of Common
Stock

    

    
      	
              1.1 

            	
              Subscription.

            

    

    

    
      
        	
              	
                (a)

              	
                The
      undersigned subscriber (the “Subscriber”),
      intending to be legally bound, hereby irrevocably subscribes for and
      agrees to purchase such number of shares of Company Common Stock (the
      “Shares”) as set forth on the signature page hereof, to be issued by Loto
      Inc., a Nevada corporation (the “Company”) in an
      offshore transaction negotiated outside the United States and to be
      consummated and closed outside the United States pursuant to the terms and
      conditions of this Agreement (this “Agreement”).

              

      

    

    

    
      	
               
      

            	
              (b)

            	
              The
      Subscriber acknowledges and agrees that the purchase price
      is US$0.01 (One U.S. Cent) per
Share.

            

    

    

    
      	
              1.2 

            	
              Procedure
      for Purchase of Shares.

            

    

    

    Following
delivery of this Agreement to the Company together with Subscriber’s anti-money
laundering due diligence information, the Company shall make a determination of
acceptance or rejection of the Subscription.  Upon notice of
acceptance of this Agreement, the Subscriber shall deliver to the Company the
full purchase price by wire transfer of immediately available funds in amount
equal to the number of Shares subscribed by the Subscriber and accepted by the
Company (the “Purchase
Price”).  The issuance of the Shares in respect of the
aggregate Purchase Price delivered to the Company shall be rounded to the
nearest whole share.  Wire instructions are attached hereto as Exhibit
A.  The Subscriber shall fax a copy of the wire transfer information
to the Company.

    

    
      	
              1.3 

            	
              Acceptance
      or Rejection.

            

    

    

    
      	
               
      

            	
              (a)

            	
              The
      Subscriber understands and agrees that the Company reserves the right to
      accept or reject at its sole discretion this Subscription
      Agreement.  The Company reserves the right to accept the
      subscription in part and refund any balance of the Purchase Price for any
      unaccepted portion of the subscription.  At any time prior to
      the Closing the Company may reject or terminate the subscription at any
      time for any reason notwithstanding delivery of notice of acceptance of
      the subscription.  The Company also reserves the right
      exercisable at any time and at its sole discretion to return the Purchase
      Price and cancel the issuance of the Shares if the Company determines that
      issuance of the Shares would cause any actual or potential violation of
      any U.S. laws, rules or regulations or the rules of any stock market,
      securities exchange or securities quotation
  system.

            

    

    

    
      	
               
      

            	
              (b)

            	
              The
      Subscriber understands and agrees that its subscription under this
      Agreement for the Shares is
irrevocable.

            

    

    

    
      	
               
      

            	
              (c)

            	
              In
      the event the sale of the Shares subscribed by the Subscriber is not
      consummated by the Company for any reason (in which event this
      Subscription Agreement shall be deemed to be rejected), this Subscription
      Agreement and any other agreement entered into between the Subscriber and
      the Company relating to this subscription shall thereafter have no force
      or effect and the Company shall promptly return or cause to be returned to
      the Subscriber the Purchase Price remitted to the Company by the
      Subscriber, without interest thereon or deduction therefrom (except for
      third party banking and wire transfer fees), in exchange for the
      Shares.

            

    

    

    
      	
              2.1 

            	
              Closing.

            

    

    

    The
closing (the “Closing”) of the
purchase and sale of the Shares, shall occur following notice of acceptance by
the Company of the Subscriber's subscription.  The Subscriber must
deliver the Purchase Price to the Company within five (5) business days of
notice of acceptance of the Subscription by the Company.  The Company
shall use commercially reasonable efforts to deliver the Stock Certificates
representing the Shares to the Subscriber within ten (10) business days after
the date of receipt of the Purchase Price.  The Closing shall be
deemed to occur upon confirmation of receipt by the Subscriber of the Stock
Certificates representing all purchased Shares.  If the Company does
not receive the Purchase Price from the Subscriber by wire transfer within five
(5) business days of notice of acceptance of the Subscription by the Company,
the Company may at its sole discretion terminate the Subscription Agreement
without recourse by the Subscriber.  A business day is any weekday on
which banks in New York City are open for normal business, which for clarity
excludes Saturdays, Sundays and legal bank holidays.  Delivery of the
Purchase Price by the Subscriber prior to acceptance of the Subscription
Agreement by the Company shall not bind the Company in any way.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    
      	
              LOTO INC. - SUBSCRIPTION
      AGREEMENT (REGULATION S)

            

    

    

    
      	
              3.1 

            	
              Subscriber
      Representations and Warranties.

            

    

    

    The
Subscriber hereby acknowledges, represents and warrants to, and agrees with, the
Company as follows:

    

    
      	
               
      

            	
              (a)

            	
              The
      Subscriber represents and warrants that it is an individual, or an entity
      regulated under the laws of the jurisdiction set forth on the signature
      page hereto.  The Subscriber acknowledges and agrees that it is
      acquiring the Stock solely for its own account for investment purposes
      only, and not with a view to, or for, resale, distribution or
      fractionalization thereof in whole or in part; and no other person has a
      direct beneficial interest in such Stock or any portion
      thereof.  The Subscriber does not have any contract,
      undertaking, agreement or arrangement with any person to sell, transfer or
      grant participations to such person or to any third person, with respect
      to the Shares for which the Subscriber is subscribing or any part of the
      Shares.  The Subscriber does not control, nor is the Investor
      controlled by or under common control with, any other Subscriber or
      investor in the Company.  No person or persons other than
      Subscriber has a beneficial interest subscribed
  hereunder.

            

    

    

    
      	
               
      

            	
              (b)

            	
              The
      Subscriber has full power and authority to enter into this Agreement, the
      execution and delivery of this Agreement has been duly authorized, if
      applicable, and this Agreement constitutes a valid and legally binding
      obligation of the Subscriber.

            

    

    

    
      	
               
      

            	
              (c)

            	
              The
      Subscriber is not acquiring the Stock as a result of or subsequent to any
      advertisement, article, notice or other communication published in any
      newspaper, magazine or similar media or broadcast over television or
      radio, or presented at any seminar or meeting, or pursuant to any
      solicitation of a subscription by a person not previously known to the
      Subscriber in connection with investment securities
    generally.

            

    

    

    
      	
               
      

            	
              (d)

            	
              The
      Subscriber understands that the Company intends to register the Shares
      under the U.S. Securities Act of 1933, as amended (the “Securities Act”),
      provided, however, there can be no assurance or guarantees with respect to
      effectiveness of such registration and the Company expressly disclaims any
      obligation to assist the Subscriber in complying with the Securities Act
      or the securities laws of any state of the United States or of any foreign
      jurisdiction.

            

    

    

    
      	
               
      

            	
              (e)

            	
              The
      Subscriber is (i) experienced in making investments of the kind described
      in this Agreement and the related documents, (ii) able, by reason of the
      business and financial experience of its officers (if an entity) and
      professional advisors (who are not affiliated with or compensated in any
      way by the Company or any of its affiliates or selling agents), to protect
      its own interests in connection with the transactions described in this
      Agreement, and the related documents, and (iii) able to afford the entire
      loss of its investment in the Shares.  The Subscriber further
      understands that the Company is in inception stage of development and has
      no business or operations, the Company currently has no agreements or
      arrangements with any persons in connection
  therewith.

            

    

    

    
      	
               
      

            	
              (f)

            	
              The
      Subscriber acknowledges its understanding that the offering and sale of
      the Shares is intended to be exempt from registration under the Securities
      Act; (i) The Subscriber acknowledges that the basis for the exemption from
      registration of the Shares may not be present if, notwithstanding such
      representations, the Subscriber is merely acquiring the Shares for a short
      term fixed or short determinable period in the future for less than one
      year, or for a market rise, or for sale if the market does not rise,
      provided, however, the Subscriber reserves the right to make decisions
      regarding disposition of the Shares at its own discretion; (ii) the
      Subscriber has the financial ability to bear the economic risk of his
      investment, has adequate means for providing for his current needs and
      personal contingencies and has no need for liquidity with respect to his
      investment in the Company; (iii) the Subscriber has such knowledge and
      experience in financial and business matters as to be capable of
      evaluating the merits and risks of the prospective investment in the
      Shares;  (iv) the Subscriber represents it has not been
      organized for the purpose of acquiring the Shares; and (v) the Subscriber
      has been provided an opportunity for a reasonable period of time prior to
      the date of signature by the Subscriber of this Subscription to obtain
      additional information concerning the offering of the Shares, the Company
      and all other information to the extent the Company possesses such
      information or can acquire it without unreasonable effort or
      expense.

            

    

    

    
      	
               
      

            	
              (g)

            	
              The
      Subscriber is not relying on the Company, or its affiliates or agents with
      respect to economic considerations involved in this
      investment.  The Subscriber has relied solely on its own
      respective advisors in making an investment
  determination.

            

    

    
      
         

      

      
        2

        
          

        

      

      
         

      

    

    

    
      	
              LOTO INC. - SUBSCRIPTION
      AGREEMENT (REGULATION S)

            

    

    

    
      	
               
      

            	
              (h)

            	
              No
      representations or warranties have been made to the Subscriber by the
      Company, or any officer, employee, agent, affiliate or subsidiary of the
      Company, other than the representations of the Company contained herein,
      and in subscribing for the Shares the Subscriber is not relying upon any
      representations other than those contained
  herein.

            

    

    

    
      	
               
      

            	
              (i)

            	
              Any
      resale of the Shares during the distribution compliance period as defined
      in Rule 902(f) to Regulation S shall only be made in compliance with
      exemptions from registration afforded by Regulation S.  Further,
      any such sale of the Shares in any jurisdiction outside of the United
      States will be made in compliance with the securities laws of such
      jurisdiction.  The Subscriber will not offer to sell or sell the
      Shares in any jurisdiction unless the Subscriber obtains all applicable
      required legal consents and regulatory
  approvals.

            

    

    

    
      	
               
      

            	
              (j)

            	
              The
      Subscriber understands that the Shares are being offered and sold in
      reliance on an exemption from the registration requirements of United
      States federal and state securities laws under Regulation S promulgated
      under the Securities Act and that the Company is relying upon the truth
      and accuracy of the representations, warranties, agreements,
      acknowledgments and understandings of the Subscriber set forth herein in
      order to determine the applicability of such exemptions and the
      suitability of the Subscriber to acquire the Shares.  In this
      regard, the Subscriber in its own capacity represents, warrants and agrees
      that: (i) the Subscriber is not a U.S. Person (as defined below) and is
      not an affiliate (as defined in Rule 501(b) under the Securities Act) of
      the Company and is not acquiring the Shares for the account or benefit of
      a U.S. Person.  A U.S. Person means any one of the following:
      (1) any natural person resident in the United States of America; (2) any
      partnership or corporation organized or incorporated under the laws of the
      United States of America; (3) any estate of which any executor or
      administrator is a U.S. person; (4) any trust of which any trustee is a
      U.S. person; (5) any agency or branch of a foreign entity located in the
      United States of America; (6) any non-discretionary account or similar
      account (other than an estate or trust) held by a dealer or other
      fiduciary for the benefit or account of a U.S. person; (7) any
      discretionary account or similar account (other than an estate or trust)
      held by a dealer or other fiduciary organized, incorporated or (if an
      individual) resident in the United States of America; and (8) any
      partnership or corporation if: (A) organized or incorporated under the
      laws of any foreign jurisdiction; and (B) formed by a U.S. person
      principally for the purpose of investing in securities not registered
      under the Securities Act, unless it is organized or incorporated, and
      owned, by accredited investors (as defined in Rule 501(a) under the
      Securities Act) who are not natural persons, estates or trusts; (ii) At
      the time of the origination of contact concerning this Agreement and the
      date of the execution and delivery of this Agreement by the Subscriber,
      the Subscriber were outside of the United States; (iii) the Subscriber
      will not, during the period commencing on the date of issuance of the
      Shares and ending on the first anniversary of such date, or such shorter
      period as may be permitted by Regulation S or other applicable securities
      law (the “Restricted
      Period”), offer, sell, pledge or otherwise transfer the Shares in
      the United States, or to a U.S. Person for the account or for the benefit
      of a U.S. Person, or otherwise in a manner that is not in compliance with
      Regulation S; (iv) the Subscriber will, after expiration of the Restricted
      Period, offer, sell, pledge or otherwise transfer the Shares only pursuant
      to registration under the Securities Act or an available exemption
      therefrom and, in accordance with all applicable state and foreign
      securities laws; (v) the Subscriber was not in the United States, engaged
      in, and prior to the expiration of the Restricted Period and will not
      engage in, any short selling of or any hedging transaction with respect to
      the Shares, including without limitation, any put, call or other option
      transaction, option writing or equity swap; (vi) Neither the Subscriber
      nor or any person acting on his behalf has engaged, nor will engage, in
      any directed selling efforts to a U.S. Person with respect to the Shares
      and the Subscriber and any person acting on his behalf has complied and
      will comply with the offering restrictions requirements of Regulation S
      under the Securities Act; (vii) The transactions contemplated by this
      Agreement have not been pre-arranged with a buyer located in the United
      States or with a U.S. Person, and are not part of a plan or scheme to
      evade the registration requirements of the Securities Act; (viii) Neither
      the Subscriber nor any person acting on their respective behalf have
      undertaken or carried out any activity for the purpose of, or that could
      reasonably be expected to have the effect of, conditioning the market in
      the United States, its territories or possessions, for any of the Shares;
      (ix) the Subscriber agrees not to cause any advertisement of the Shares to
      be published in any newspaper or periodical or posted in any public place
      and not to issue any circular relating to the Shares, except such
      advertisements that include the statements required by Regulation S under
      the Securities Act, and only offshore and not in the U.S. or its
      territories, and only in compliance with any local applicable securities
      laws; (x) the Subscriber consents to the Company making a notation on its
      records or giving instructions to any transfer agent of the Company in
      order to implement the restrictions on transfer of the Shares set forth in
      this Agreement; and (xi) Each certificate representing the purchased
      Shares shall be endorsed with the following legends, in addition to any
      other legend required to be placed thereon by applicable federal or state
      securities laws:

            

    

    
      
         

      

      
        3

        
          

        

      

      
         

      

    

    

    
      	
              LOTO INC. - SUBSCRIPTION
      AGREEMENT (REGULATION S)

            

    

    

    THE
SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE BEEN OFFERED AND SOLD TO
NON-U.S. PERSONS, AS DEFINED IN REGULATION S UNDER THE SECURITIES ACT OF 1933,
AS AMENDED (THE “SECURITIES ACT”) AND WITHOUT REGISTRATION WITH THE UNITED
STATES SECURITIES AND EXCHANGE COMMISSION UNDER THE SECURITIES ACT IN RELIANCE
UPON REGULATION S PROMULGATED UNDER THE SECURITIES ACT.  TRANSFER OF
THESE SECURITIES IS PROHIBITED, EXCEPT IN ACCORDANCE WITH THE PROVISIONS OF
REGULATION S, PURSUANT TO REGISTRATION UNDER THE SECURITIES ACT, OR PURSUANT TO
AVAILABLE EXEMPTION FROM REGISTRATION. HEDGING TRANSACTIONS MAY NOT BE CONDUCTED
UNLESS IN COMPLIANCE WITH THE SECURITIES ACT.

    

    
      	
               
      

            	
              (k)

            	
              The
      Subscriber is an accredited investor as that term is defined in Rule 501
      of the General Rules and Regulations under the Securities Act by reason of
      Rule 501(a)(3).

            

    

    

    
      	
               
      

            	
              (l)

            	
              The
      Subscriber understands that an investment in the Shares is a speculative
      investment which involves a high degree of risk and the potential loss of
      his entire investment.

            

    

    

    
      	
               
      

            	
              (m)

            	
              The
      Subscriber's overall commitment to investments which are not readily
      marketable is not disproportionate to the Subscriber's net worth, and an
      investment in the Shares will not cause such overall commitment to become
      excessive.

            

    

    

    
      	
               
      

            	
              (n)

            	
              The
      Subscriber has received all documents, records, books and other
      information pertaining to the Subscriber’s investment in the Company that
      have been requested by the Subscriber in writing as such request has been
      delivered to the Company with independent confirmation of receipt by the
      Company from the U.S. Postal Service or international
    courier.

            

    

    

    
      	
               
      

            	
              (o)

            	
              The
      Subscriber represents and warrants to the Company that all information
      that the Subscriber has provided to the Company, including, without
      limitation, the information set forth herein and attached hereto or
      previously provided to the Company is correct and complete as of the date
      of signature and the date of acceptance of this
    Subscription.

            

    

    

    
      	
               
      

            	
              (p)

            	
              The
      Subscriber represents1 and warrants to the
      Company that the consideration tendered by the Subscriber to the Company
      are not and will not be directly or indirectly derived from activities
      that may contravene federal, state and international laws and regulations,
      including anti-money laundering laws; and The OFAC prohibits, among other
      things, the engagement in transactions with, and the provisions of
      services to, certain foreign countries, territories, entities and
      individuals.  The lists of OFAC prohibited countries,
      territories, persons and entities can be found on the OFAC
      website.  The Subscriber hereby represents and warrants, to the
      best of its knowledge, that none of the Subscriber, any person
      controlling, controlled by, or under common control with, the Subscriber,
      any person having a beneficial interest in the Subscriber, or any person
      for whom the Subscriber is acting as agent or nominee in connection with
      this investment is: a country, territory, individual or entity named on an
      OFAC list, or is an individual or entity that resides or has a place of
      business in a country or territory named on such lists,  a
      senior foreign political figure2, or any immediate
      family member3
      or close associate4 of a senior foreign
      political figure within the meaning of the U.S. Department of Treasury’s
      Guidance on Enhanced Scrutiny for Transactions That May Involve the
      Proceeds of Foreign Official Corruption5 and as referenced
      in the USA Patriot Act of 2001;6 or a "foreign shell
      bank"7 and does
      not transact business with a "foreign shell bank." The Subscriber agrees
      to promptly notify the Company should the Subscriber become aware of any
      change in the information set forth in these
      representations.  The Subscriber understands that, by law, the
      Company may be obligated to "freeze the account" of such Subscriber,
      either by prohibiting additional amounts, declining any redemption
      requests and/or segregating the assets in the account in compliance with
      governmental regulations, and the Company may also be required to report
      such action and to disclose the Subscriber’s identity to OFAC. The
      Subscriber understands that the Company may not accept any contributed
      amounts from the Subscriber if the Subscriber cannot make the
      representation set forth above and the Company may return any amounts to
      Subscriber if the information provided to the Company is incomplete or is
      deemed suspicious.  The Subscriber represents and warrants that
      the acceptance of the Subscriber's Subscription Agreement together with
      the appropriate remittance will not breach any applicable anti-money
      laundering rules and regulations.  The Subscriber undertakes to
      provide verification of its identity reasonably satisfactory (on a
      confidential basis), to the Company and/or any entity acting on the
      Company’s behalf in respect of the acceptance of subscriptions, promptly
      on request.

            

    

     

    
      
        

      

      1 The Subscriber should check the U.S.
Treasury Department’s Office of Foreign Assets Control ("OFAC") website at
http://www.treas.gov/ofac before making the
representations.

    

    
      2 A
“senior foreign political figure” is defined as a current or former official in
the executive, legislative, administrative, military or judicial branches of a
non-U.S. government (whether elected or not), a senior official of a major
non-U.S. political party, or a senior executive of a non-U.S. government-owned
corporation.  In addition, a “senior foreign political figure”
includes any corporation, business or other entity that has been formed by, or
for the benefit of, a senior foreign political figure.

    

    
      3
“Immediate family” of a senior foreign political figure typically includes the
figure’s parents, siblings, spouse, children and in-laws.

    

    
      4 A “close
associate” of a senior foreign political figure is a person who is widely and
publicly known to maintain an unusually close relationship with the senior
foreign political figure, and includes a person who is in a position to conduct
substantial domestic and international financial transactions on behalf of the
senior foreign political figure.

    

    
      5 Please see http://www.federalreserve.gov/boarddocs/srletters/2001/sr0103a1.pdf for a more extensive discussion of the
referenced terms and definitions.

    

    
      6 The
Uniting and Strengthening America by Providing Appropriate Tools Required to
Intercept and Obstruct Terrorism Act of 2001, Pub. I. No. 107-56
(2001).

    

    7 A “foreign
shell bank” is a foreign bank that does not have a physical presence in any
country

     

    
      
        
           

        

        
          4

          
            

          

        

        
           

        

      

    

    

    
      	
              LOTO INC. - SUBSCRIPTION
      AGREEMENT (REGULATION S)

            

    

    

    
      	
               
      

            	
              (q)

            	
              The
      Subscriber is aware that no federal or state agency has (i) made any
      finding or determination as to the fairness of this investment, (ii) made
      any recommendation or endorsement of the Shares or the Company, or (iii)
      guaranteed or insured any investment in the Shares or any investment made
      by the Company.

            

    

    

    
      	
               
      

            	
              (r)

            	
              The
      Subscriber understands that the price of the Shares offered hereby bear no
      relation to the assets, book value or net worth of the Company and were
      determined arbitrarily by the Company. The Subscriber further understands
      that there is a substantial risk of further dilution on his or its
      investment in the Company.

            

    

     

    
      	
              4.0 

            	
              The
      Company represents and warrants to the Subscriber as
    follows:

            

    

    

    
      	
               
      

            	
              4.1

            	
              Organization
      of the Company.  The Company is a corporation duly organized and
      validly existing and in good standing under the laws of the State of
      Nevada, and has all requisite power and authority to own, lease and
      operate its properties and to carry on its business as now being
      conducted.

            

    

    

    
      	
               
      

            	
              4.2

            	
              Authority.  (a)
      The Company has the requisite corporate power and authority to enter into
      and perform its obligations under this Agreement and to issue the Shares;
      (b) the execution and delivery of this Agreement by the Company and the
      consummation by it of the transactions contemplated hereby and thereby
      have been duly authorized by all necessary corporate action and no further
      consent or authorization of the Company or its Board of Directors is
      required; and (c) this Agreement has been duly executed and delivered by
      the Company and constitutes a valid and binding obligation of the Company
      enforceable against the Company in accordance with its terms, except as
      such enforceability may be limited by applicable bankruptcy, insolvency,
      or similar laws relating to, or affecting generally the enforcement of,
      creditors' rights and remedies or by other equitable principles of general
      application.

            

    

    

    
      	
               
      

            	
              4.3

            	
              Share
      Capitalization. As of the date of acceptance of this Subscription, the
      authorized capital stock of the Company consists of 100,000,000 shares of
      common stock.  All the outstanding shares are validly issued and
      are fully paid and nonassessable.  The Common Stock has a par
      value US$0.001 per share (the “Common Stock”).  Par Value is a
      nominal value that is a vestige of creditors’ rights laws that was
      arbitrarily assigned to the shares of Common Stock for purposes of
      compliance with applicable state law at the date of the Company’s
      incorporation. It bears no direct relationship to the market value of the
      stock, or the Purchase Price of the Common Stock, or any ultimate sale or
      disposition value which may be derived from the Common
    Stock.

            

    

    

    
      	
               
      

            	
              4.4

            	
              Exemption
      from Registration; Valid Issuances.  The sale and issuance of
      the Shares, on the basis of the representations and warranties of the
      Subscriber set forth herein, may and shall be properly issued by the
      Company to the Subscriber pursuant to Section 4(2), Regulation S and/or
      any applicable U.S state law.  When issued and paid for as
      herein provided, the Shares shall be duly and validly issued, fully paid,
      and nonassessable. Neither the sales of the Shares pursuant to, nor the
      Company's performance of its obligations under, this Agreement shall (a)
      result in the creation or imposition of any liens, charges, claims or
      other encumbrances upon the Shares or any of the assets of the Company, or
      (b) entitle the other holders of the Common Stock of the Company to
      preemptive or other rights to subscribe to or acquire the Common Stock or
      other securities of the Company.

            

    

    

    
      	
               
      

            	
              4.5

            	
              No
      General Solicitation or Advertising in Regard to this Transaction. Neither
      the Company nor any of its affiliates nor any person acting on its or
      their behalf (a) has conducted or will conduct any general solicitation
      (as that term is used in Rule 502(c) of Regulation D) or general
      advertising with respect to any of the Shares, or (b) made any offers or
      sales of any security or solicited any offers to buy any security under
      any circumstances that would require registration of the Common Stock
      under the Securities Act.

            

    

     

    
      
         

      

      
        5

        
          

        

      

      
         

      

    

    

    
      
        	
                LOTO INC. - SUBSCRIPTION
      AGREEMENT (REGULATION
S)

              

      

    

    

    
      	
               
      

            	
              4.6

            	
              No
      Conflicts. The execution, delivery and performance of this Agreement by
      the Company and the consummation by the Company of the transactions
      contemplated hereby, including without limitation the issuance of the
      Shares, do not and will not (a) result in a violation of the Certificate
      or By-Laws of the Company or (b) conflict with, or constitute a material
      default (or an event that with notice or lapse of time or both would
      become a material default) under, or give to others any rights of
      termination, amendment, acceleration or cancellation of, any material
      agreement, indenture, instrument or any "lock-up" or similar provision of
      any underwriting or similar agreement to which the Company is a party, or
      (c) result in a violation of any federal, state, local or foreign law,
      rule, regulation, order, judgment or decree (including federal and state
      securities laws and regulations)applicable to the Company or by which any
      property or asset of the Company is bound or affected (except for such
      conflicts, defaults, terminations, amendments, accelerations,
      cancellations and violations as would not, individually or in the
      aggregate, have a material adverse effect on the business, operations,
      properties, prospects or condition (financial or otherwise) of the
      Company) nor is the Company otherwise in violation of, conflict with or in
      default under any of the foregoing. The Company is not required under U.S.
      federal, state or local law, rule or regulation to obtain any consent,
      authorization or order of, or make any filing or registration with, any
      court or governmental agency in order for it to execute, deliver or
      perform any of its obligations under this Agreement or issue and sell the
      Common Stock in accordance with the terms hereof (other than any SEC, NASD
      or state securities filings that may be required to be made by the Company
      subsequent to the Closing); provided that, for purposes of the
      representation made in this sentence, the Company is assuming and relying
      upon the accuracy of the relevant representations and agreements of the
      Subscriber herein.

            

    

    

    
      	
              5.1

            	
              Registration.  The
      Subscriber acknowledges that the Shares are restricted.  The
      Company undertakes to use commercially reasonable efforts to register the
      Shares with the U.S. Securities and Exchange Commission (the “SEC”),
      provided, however, any and all determinations regarding such registration
      shall be made at the sole discretion of the Company.  The
      Subscriber expressly acknowledges and agrees that there can be no
      assurance the Company will be able to successfully obtain a declaration of
      effectiveness from the SEC with respect to a registration statement for
      the Shares or to facilitate the trading of the Shares on any market at any
      time.  The Company may defer, cease or withdraw registration of
      the Shares at any time for any reason.  The Company makes no
      undertakings in respect of maintaining the effectiveness of any
      registration of the Shares if granted by the SEC.  The
      Subscriber agrees to promptly cooperate with any and all requests by the
      Company to provide information responsive to preparation, filing and
      requests for effectiveness of the registration statement for the
      Shares.  The Subscriber will comply with any and all laws, rules
      and regulations pertaining to such registration and in regard to any and
      all offers, solicitations, sales or trading of such
  Shares.

            

    

    

    
      	
              6.1

            	
              Indemnity.  The
      Subscriber agrees to indemnify and hold harmless the Company, its officers
      and directors, employees and its affiliates and their respective
      successors and assigns and each other person, if any, who controls any
      thereof, against any loss, liability, claim, damage and expense whatsoever
      (including, but not limited to, any and all expenses whatsoever reasonably
      incurred in investigating, preparing or defending against any litigation
      commenced or threatened or any claim whatsoever) arising out of or based
      upon any false representation or warranty or breach or failure by the
      Subscriber to comply with any covenant or agreement made by the Subscriber
      herein or in any other document furnished by the Subscriber to any of the
      foregoing in connection with this transaction.  The Subscriber
      releases, indemnifies and holds harmless the Company’s attorney in
      connection with receipt of the Purchase Price to the attorney trust
      account and transmission of such funds to the
  Company.

            

    

    

    
      	
              6.2

            	
              Modification.  Neither
      this Agreement nor any provisions hereof shall be modified, discharged or
      terminated except by an instrument in writing signed by the party against
      whom any waiver, change, discharge or termination is
    sought.

            

    

    

    
      	
              6.3

            	
              Notices.  Any
      notice, demand or other communication which any party hereto may be
      required, or may elect, to give to party hereto shall be sufficiently
      given if (a) sent by registered or certified mail, return receipt
      requested, addressed to such address as provided herein, (b) Sent by
      internationally recognized courier with confirmation of delivery or
      evidence of refusal; or (c) delivered personally at such
      address.  In the case of the Company, all notices shall be
      deemed given two business days after mailing to the Subscriber; and in the
      case of the Subscriber, all notices shall be deemed given to the Company
      upon written confirmation of receipt by the Company.  The
      Company may give notice of acceptance of this Subscription by verbal
      advice, e-mail or fax to any address or phone number provided to the
      Company by the Subscriber on the Signature page
  below.

            

    

    
      
         

      

      
        6

        
          

        

      

      
         

      

    

    

    
      
        	
                LOTO INC. - SUBSCRIPTION
      AGREEMENT (REGULATION
S)

              

      

    

    

    
      	
              6.4

            	
              Counterparts.  This
      Agreement may be executed through the use of separate signature pages or
      in any number of counterparts and by facsimile, and each of such
      counterparts shall, for all purposes, constitute one agreement binding on
      all parties, notwithstanding that all parties are not signatories to the
      same counterpart. Signatures may be facsimiles or electronically scanned
      copies which shall be deemed to have the same full force and effect as a
      manually signed original thereof.

            

    

    

    
      	
              6.5

            	
              Binding
      Effect.  Except as otherwise provided herein, this Agreement
      shall be binding upon and inure to the benefit of the parties and their
      heirs, executors, administrators, successors, legal representatives and
      assigns.  If the Subscriber is more than one person, the
      obligation of the Subscriber shall be joint and several and the
      agreements, representations, warranties and acknowledgments herein
      contained shall be deemed to be made by and be binding upon each such
      person and his heirs, executors, administrators and
      successors.  The representations and warranties of the
      Subscriber shall survive the execution and delivery hereof and the
      Closing.

            

    

    

    
      	
              6.6

            	
              Entire
      Agreement.  This Agreement and the documents referenced herein
      contain the entire agreement of the parties and there are no
      representations, covenants or other agreements except as stated or
      referred to herein and therein.

            

    

    

    
      	
              6.7

            	
              Assignability.  This
      Agreement is not transferable or assignable by the Company or the
      Subscriber.

            

    

    

    
      	
              6.8

            	
              Applicable
      Law.  This Agreement shall be governed by and construed in
      accordance with the laws of the State of New York, without giving effect
      to conflicts of law principles.  The invalidity or
      unenforceability of any provision of this Agreement shall not affect the
      validity or enforceability of any other provision of this
      Agreement.  All disputes and controversies arising out of or
      relating to this Agreement shall be finally settled and binding under the
      Rules of International Commercial Dispute Resolution of the American
      Arbitration Association (“ICDR”).  The place of arbitration
      shall be New York.  The Arbitration shall be conducted in
      English by a single arbitrator appointed in accordance with the ICDR
      rules.  Any award, verdict or settlement issued under such
      arbitration may be entered by any party for order of enforcement by any
      court of competent jurisdiction.  The arbitrator shall have no
      power to take interim measures he or she deems necessary, including
      injunctive relief and measures for the protection or conservation of
      property.

            

    

    

    
      	
              6.9

            	
              Pronouns.  The
      use herein of the masculine pronouns "him" or "his" or similar terms shall
      be deemed to include the feminine and neuter genders as well and the use
      herein of the singular pronoun shall be deemed to include the plural as
      well.

            

    

    

    [
Signature Page Follows ]

    
      
         

      

      
        7

        
          

        

      

      
         

      

    

     

    
      	
              LOTO INC. - SUBSCRIPTION
      AGREEMENT (REGULATION S)

            

    

     

    IN
WITNESS WHEREOF, the Subscriber has executed this Agreement for the Subscription
of Shares:

    

    US$.01
Per Share

    Common
Stock

    (Regulation
S)

    

      Purchase
of Shares consisting of the following:

      

      
        
          
            	
                    Total
      Shares Purchased:

                  	
                     

                  
	 
      	 
      
	
                    Total
      Purchase Price:

                  	
                     

                  

          

        

      

      

      SUBSCRIBER:

      

      
        
          
            
              	
                      Print Full Legal Name:

                    	 
      

            

          

        

      

      
        
          
            
              
                
                  
                    
                      	
                              Address:

                            	 
      
	 	 

                    

                  

                

              

            

          

        

      

      
        
          
            	
                    Telephone (with country code):

                  	 
      

          

        

      

      
        
          
            
              
                	
                        Fax
      Number:

                      	 
      

              

            

          

        

      

      
        
          
            
              	
                      E-mail:

                    	 
      

            

          

        

      

      
        
          
            
              
                
                  
                    	
                            Address for Notices (if different from above)

                          	  
	 	 

                  

                

              

            

          

        

      

      
        
          
            
              
                	
                        Permanent Address  (if different from above)

                      	 
      
	 	 

              

            

          

        

      

      
        
          
            	
                    Legal form if an entity (trust, corporation, partnership, etc.):

                  	  

          

        

      

      
        
          
            
              	
                      Jurisdiction of organization if an entity:

                    	  

            

          

        

      

      
        
          
            	
                    Jurisdiction of registration and regulation if a bank:

                  	 
      

          

        

      

    

    

    Anti-money
laundering documentation: Attach copy of a valid passport (notarized as a true
copy or certified by a lawyer) and a recent utility bill showing the name of the
Subscriber and the subscription address of record (notarized as a true copy or
certified by a lawyer).  For corporate entities, please deliver
certified copies of charter documents and individual due diligence information
for all officers, directors and all beneficial owners who have the right to vote
the Shares or power of disposition over the Shares.

    

    
      
        
          	
                  By
      (Signature):

                
	
                  Print
      Name:

                

        

      

    

     

    The Company hereby accepts the above
application for subscription of the Shares as of the ________ day of
______________, 2009:

    

    
      
        
          
            
              	
                      LOTO
      INC.

                    
	 
      
	
                      By:

                    
	
                      Name:

                    
	
                      Title:

                    

            

          

        

      

    

    
      
         

      

      
        8

        
          

        

      

      
         

      

    

    
      	
              LOTO INC. - SUBSCRIPTION
      AGREEMENT (REGULATION S)

            

    

     

    Exhibit A

    

    Wiring
Instructions

    

    For
Payment of the Purchase Price of the Stock:

    

    The
following are the wire instructions for the account into which the payment of
the Purchase Price for the Stock subscribed should be wired after acceptance of
the Agreement.

     

    FOR
PROPER CREDIT, PLEASE MAKE SURE THAT THE WIRE TRANSFER INFORMATION CLEARLY
INCLUDES THE NAME OF THE SUBSCRIBER OF RECORD.  PLEASE RETAIN A COPY
OF ALL WIRE TRANSFERS INSTRUCTIONS AND CONFIRMATIONS.

     

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

     

    
      
         Loto
Inc.

      

      
        Series
A Investors (Regulation S)

      

      

      
        	
                Name
      of Investor

              	
                Shares

                Purchased

              
	
                NAC
      Investments Ltd.

              	
                2,500,000

              
	
                2207496
      Ontario Inc.

              	
                2,500,000

              
	
                1476448
      Ontario Inc.

              	
                2,500,000

              
	
                2207846
      Ontario Limited

              	
                2,500,000

              
	
                2208155
      Ontario Inc.

              	
                2,500,000

              

      

      

        
          
             

          

          
            10

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