Datasets:

hugsid

/

legal-contracts

like 2

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

i. Title to Property. The Company and its subsidiaries have good and marketable title in fee simple to all real property and good and marketable title to all personal property owned by them which is material to the business of the Company and its subsidiaries, in each case free and clear of all liens, encumbrances and defects except such as would not have a material adverse effect. Any real property and facilities held under lease by the Company and its subsidiaries are held by them under valid, subsisting and enforceable leases with such exceptions as would not have a material adverse effect.

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

a. Listing. The Company shall promptly secure the listing of the Conversion Shares upon each national securities exchange or automated quotation system, if any, upon which shares of Common Shares are then listed (subject to official notice of issuance) and, so long as the Buyer owns any of the Securities, shall maintain, so long as any other shares of Common Shares shall be so listed, such listing of all Conversion Shares from time to time issuable upon conversion of the Notes.

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

b. Counterparts; Signatures by Facsimile. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original but all of which shall constitute one and the same agreement and shall become effective when counterparts have been signed by each party and delivered to the other party. This Agreement, once executed by a party, may be delivered to the other party hereto by facsimile transmission of a copy of this Agreement bearing the signature of the party so delivering this Agreement.

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

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

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

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

WHEREAS, the Company intends to consummate a public offering of the Companys units (the Public Offering), each unit consisting of one share of the Companys Class A common stock, par value $0.0001 per share (a Share), and one-half of one redeemable warrant, as set forth in the Companys registration statement on Form S-1 related to the Public Offering (the Registration Statement). Each whole warrant entitles the holder to purchase one Share at an exercise price of $11.50 per Share;

(ii) At or prior to the time of the Closing Date, the Company and the Purchaser shall enter into a registration rights agreement (the Registration Rights Agreement) pursuant to which the Company will grant certain registration rights to the Purchaser relating to the Sponsor Warrants and the Shares underlying the Sponsor Warrants.

C.Title to Securities. Upon issuance in accordance with, and payment pursuant to, the terms hereof and the Warrant Agreement, the Shares issuable upon exercise of the Sponsor Warrants will be duly and validly issued, fully paid and nonassessable. Upon issuance in accordance with, and payment pursuant to, the terms hereof and the Warrant Agreement, the Purchaser will have good title to the Sponsor Warrants and the Shares issuable upon exercise of such Sponsor Warrants, free and clear of all liens, claims and encumbrances of any kind, other than (i)transfer restrictions hereunder and under the other agreements contemplated hereby, (ii)transfer restrictions under federal and state securities laws, and (iii)liens, claims or encumbrances imposed due to the actions of the Purchaser.

(i) This Agreement constitutes the valid and binding obligation of the Purchaser, enforceable in accordance with its terms, subject to bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and other laws of general applicability relating to or affecting creditors rights and to general equitable principles (whether considered in a proceeding in equity or law).

(ii) The execution and delivery by the Purchaser of this Agreement and the fulfillment of and compliance with the terms hereof by the Purchaser does not and shall not as of the Closing Date conflict with or result in a breach by the Purchaser of the terms, conditions or provisions of any agreement, instrument, order, judgment or decree to which the Purchaser is subject.

(i) The Purchaser is acquiring the Sponsor Warrants and, upon exercise of the Sponsor Warrants, the Shares issuable upon such exercise (collectively, the Securities), for the Purchasers own account, for investment purposes only and not with a view towards, or for resale in connection with, any public sale or distribution thereof.

(iii) The Purchaser understands that the Securities are being offered and will be sold to it in reliance on specific exemptions from the registration requirements of the United States federal and state securities laws and that the Company is relying upon the truth and accuracy of, and the Purchasers compliance with, the representations and warranties of the Purchaser set forth herein in order to determine the availability of such exemptions and the eligibility of the Purchaser to acquire such Securities.

(vi) The Purchaser understands that no United States federal or state agency or any other government or governmental agency has passed on or made any recommendation or endorsement of the Securities or the fairness or suitability of the investment in the Securities by the Purchaser nor have such authorities passed upon or endorsed the merits of the offering of the Securities.

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

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

A.Successors and Assigns. Except as otherwise expressly provided herein, all covenants and agreements contained in this Agreement by or on behalf of any of the parties hereto shall bind and inure to the benefit of the respective successors of the parties hereto whether so expressed or not. Notwithstanding the foregoing or anything to the contrary herein, the parties may not assign this Agreement, other than assignments by the Purchaser to affiliates thereof.

| COMPANY: ---|--- | | HAYMAKER ACQUISITION CORPORATION | | | By: | /s/ Christopher Bradley | Name: | Christopher Bradley | Title: | Chief Financial Officer | | PURCHASER: | | HAYMAKER SPONSOR, LLC | | | By: | /s/ Andrew R. Heyer | Name: | Andrew R. Heyer | Title: | Managing Member

WHEREAS, the Company desires to issue, and the Purchasers desire to purchase, up to an aggregate of 50,000 units (the Units), each Unit consisting of one share (the Shares) of the Companys Series B Convertible Preferred Stock, par value $0.0001 per share (Series B Preferred Stock), initially convertible into four hundred (400) shares of the Companys common stock, par value $0.0001 per share (Common Stock), and a seven year warrant, substantially in the form attached hereto as Exhibit B (the Warrants) to acquire four hundred (400) shares of Common Stock (the Warrant Shares) at an exercise price of $0.25 per share, in a private placement (this Offering), at a price of $100.00 per Unit for an aggregate purchase price of $5,000,000.

(a)Agreement to Purchase and Sell Shares. Subject to the terms and conditions of this Agreement, each Purchaser agrees to purchase, and the Company agrees to sell and issue to such Purchaser, at the Closing (as defined below), at a price of $100.00 per Unit, such number of Units to be purchased by such Purchaser as set forth on the signature pages hereto.

(b)Obligations Several and Not Joint. The obligations of each Purchaser under this Agreement are several and not joint with the obligations of any other Purchaser, and no Purchaser shall be responsible in any way for the performance of the obligations of any other Purchaser under this Agreement. The decision of each of the Purchasers to purchase Units pursuant to this Agreement has been made by such Purchaser independently of any other Purchaser. Nothing contained herein, and no action taken by any Purchaser pursuant hereto, shall be deemed to constitute the Purchasers as a partnership, an association, a joint venture or any other kind of entity, or create a presumption that the Purchasers are in any way acting in concert or as a group with respect to such obligations or the transactions contemplated by this Agreement.

(b)Delivery. At the Closing, subject to the terms and conditions hereof, the Company will deliver to each Purchaser (i) a certificate representing the number of Shares to be purchased at the Closing by such Purchaser, and (ii) a Warrant, executed by the Company and registered in the name of such Purchaser, pursuant to which such Purchaser shall have the right to acquire such number of Warrant Shares equal to the number of shares of Common Stock initially issuable upon conversion of the Shares underlying the Units purchased by such Purchaser hereunder (the Conversion Shares), against payment of the purchase price therefor by check made payable to the order of, or wire transfer to, the Company.

Except as set forth in the Disclosure Letter delivered by the Company to each Purchaser at or prior to the Closing, the Company hereby represents and warrants to the Purchasers that as of the Closing Date (except with respect to any representations and warranties that speak as of a specified date, which shall be true and correct as of such date):

(a)Organization Good Standing and Qualification. The Company is a corporation duly organized, validly existing and in good standing under the laws of the State of Florida and has all corporate power and authority required (i) to own, operate and occupy its properties and to carry on its business as presently conducted and (ii) to enter into this Agreement and to consummate the transactions contemplated hereby. The Company is qualified to do business and is in good standing in each jurisdiction in which the failure to so qualify would have a Material Adverse Effect. As used in this Agreement, Material Adverse Effect means a material adverse effect on, or a material adverse change in, the business, operations, financial condition, results of operations, properties, prospects, assets or liabilities of the Company, taken as a whole, or on the transactions contemplated hereby and the other agreements, instruments and documents contemplated hereby or on the authority or ability of the Company to perform its obligations under this Agreement.

(ii)As of the date hereof, the issued and outstanding capital stock of the Company consisted of (A) 73,105,834 shares of Common Stock and (B) no shares of Preferred Stock. The issued and outstanding shares of Common Stock have been duly authorized and validly issued, are fully paid and nonassessable and have not been issued in violation of and are not otherwise subject to any preemptive or other similar rights.

(iii)The Company does not have any stock option or similar stock incentive plans. Except as set forth in the SEC Documents (as defined below), there are no outstanding subscriptions, options, warrants, convertible or exchangeable securities or other rights granted to or by the Company to purchase shares of Common Stock or other securities of the Company and there are no commitments, plans or arrangements to issue any shares of Common Stock or any security convertible into or exchangeable for Common Stock. There are no outstanding securities or instruments of the Company which contain any redemption or similar provisions; there are no securities or instruments containing anti-dilution or similar provisions that will be triggered by the issuance of the Shares and Warrants; and none of the Companys capital stock is subject to preemptive rights or any other similar rights or any liens or encumbrances suffered or permitted by the Company. Except as set forth in the SEC Documents, there are no shareholder agreements, voting agreements, or other similar arrangements, with respect to the Companys capital stock to which the Company is a party or, to the Companys knowledge, between or among any of the Companys stockholders.

(c)Subsidiaries. Except as set forth in the SEC Documents, the Company does not have any Subsidiaries, and the Company does not own any capital stock of, assets comprising the business of, obligations of, or any other interest (including any equity or partnership interest) in, any person or entity. As used herein "Subsidiaries" means any entity in which the Company, directly or indirectly, owns any capital stock or holds an equity or similar interest. Each Subsidiary of the Company (i) is a corporation duly organized, validly existing and in good standing under the laws of the State of Florida, (ii) has all corporate power and authority required to own, operate and occupy its properties and to carry on its business as presently conducted, and (iii) is qualified to do business and is in good standing in each jurisdiction in which the failure to so qualify would have a Material Adverse Effect.

(i)Securities. Upon issuance in accordance with the terms hereof, the Certificate of Designation and Warrants, as applicable, and the payment therefor by the Purchasers, the Shares, the Conversion Shares, the Warrants and the Warrant Shares (collectively, the Securities) will be duly authorized, validly issued, fully paid and non-assessable free and clear from all taxes, liens, claims and encumbrances other than restrictions on transfer imposed by the applicable securities laws, and will not be subject to any preemptive rights or similar rights.

(ii)Compliance with Securities Laws. Subject to the accuracy of the representations made by the Purchasers in Section 4 hereof, the Shares and Warrants will be issued and sold to the Purchasers in compliance with an applicable exemption from the registration and prospectus delivery requirements of the Securities Act of 1933, as amended (the Securities Act).

(g)Non-Contravention. The execution, delivery and performance of this Agreement by the Company, and the consummation by the Company of the transactions contemplated hereby and thereby, do not (i) contravene or conflict with the Articles of Incorporation or Bylaws of the Company; (ii) assuming the accuracy of the representations and warranties made by the Purchasers in Section 4 hereof, constitute a violation in any respect of any provision of any federal, state, local or foreign law, rule, regulation, order, judgment or decree applicable to the Company; or (iii) conflict with, or constitute a default (or an event which with notice or lapse of time or both would become a default) or require any consent under, give rise to any right of termination, amendment, cancellation or acceleration of, or to a loss of any material benefit to which the Company or any of its Subsidiaries is entitled under, or result in the creation or imposition of any lien, claim or encumbrance on any assets of the Company or any of its Subsidiaries under, any contract to which the Company or any of its Subsidiaries is a party or any permit, license or similar right relating to the Company or any of its Subsidiaries.

(i)Reports. Since January 1, 2016, the Company has filed in a timely manner (giving effect, where applicable, to any deferral periods provided under Rule 12b-25 under the Securities Exchange Act of 1934, as amended (the Exchange Act)) all reports, schedules, forms, statements and other documents required to be filed by it with the Securities and Exchange Commission (the SEC) pursuant to the reporting requirements of the Exchange Act and the rules and regulations promulgated thereunder. The Company has filed on the SECs EDGAR system, prior to the date hereof, its Annual Report on Form 10-K for the fiscal year ended December 31, 2016 (the Form 10-K), and any Current Report on Form 8-K (Form 8-Ks) required to be filed by the Company with the SEC for events occurring since January 1, 2017 (the Form 10-K and Form 8-Ks, together with all exhibits, schedules and other attachments that are filed with such documents, are collectively referred to herein as the SEC Documents). Each SEC Document, as of its date (or, if amended or superseded by a filing prior to the Closing Date, then on the date of such filing), did not contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements made therein, in light of the circumstances under which they were made, not misleading. Each SEC Document, as it may have been subsequently amended by filings made by the Company with the SEC prior to the date hereof, complied in all material respects with the requirements of the Exchange Act and the rules and regulations of the SEC promulgated thereunder applicable to such SEC Document. As of their respective dates, any financial statements of the Company included in the SEC Documents complied as to form and substance in all material respects with applicable accounting requirements and published rules and regulations of the SEC with respect thereto. Such financial statements have been prepared in accordance with generally accepted accounting principles, consistently applied in the United States (GAAP), during the periods involved (except in the case of unaudited interim statements, to the extent they may exclude footnotes or may be condensed or summary statements), correspond to the books and records of the Company and fairly present in all material respects the financial position of the Company as of the dates thereof and the results of operations and cash flows for the periods then ended. The Company is not required to file and will not be required to file any agreement, note, lease, mortgage, deed or other instrument entered into prior to the date of this Agreement and to which the Company is a party or by which the Company is bound which has not been previously filed or incorporated by reference as an exhibit to the SEC Documents.

(ii)Sarbanes-Oxley. The Chief Executive Officer and the Chief Financial Officer of the Company have signed, and the Company has furnished to the SEC, all certifications required by Sections 302 and 906 of the Sarbanes-Oxley Act of 2002 as of the date hereof. Such certifications contain no exceptions to the matters certified therein and have not been modified or withdrawn; and neither the Company nor any of its officers has received notice from any Governmental Entity questioning or challenging the accuracy of such certifications. The Company is otherwise in compliance with all applicable effective provisions of the Sarbanes-Oxley Act of 2002 and the rules and regulations issued thereunder by the SEC.

(l)Intellectual Property. To the Companys knowledge, the Company and its Subsidiaries own or possess sufficient rights to use all patents, patent rights, inventions, trade secrets, know-how, trademarks, or other intellectual property (collectively, Intellectual Property), which are necessary to conduct their business as currently conducted. To the Companys knowledge, neither the Company nor any of its Subsidiaries has infringed any patents of others with respect to any Intellectual Property. There is no claim, action or proceeding pending, or to the Companys knowledge, threatened, against the Company or any of its Subsidiaries with respect to any Intellectual Property. The Company has no knowledge of any infringement or improper use by any third party with respect to any Intellectual Property of the Company or any of its Subsidiaries.

(n)Title to Property and Assets. Except as set forth in the SEC Documents, the properties and assets of the Company and its Subsidiaries (including real property) are respectively owned by them, free and clear of all mortgages, deeds of trust, liens, charges, encumbrances and security interests except for (i) statutory liens for the payment of current taxes that are not yet delinquent and (ii) liens, encumbrances and security interests that are in the ordinary course of business and do not materially detract from the value of the properties and assets of the Company, taken as a whole. With respect to the property and assets leased by the Company and its Subsidiaries, the Company and its Subsidiaries are in compliance with such leases in all material respects and such leases are held by them under valid, subsisting and enforceable leases with such exceptions as are not material and do not interfere with the use made and proposed to be made of such property and buildings by the Company and its Subsidiaries. All facilities, machinery, equipment, fixtures, vehicles and other properties owned, leased or used by the Company and its Subsidiaries are in good operating condition and repair and are reasonably fit and usable for the purposes for which they are being used.

(o)Taxes. The Company and its Subsidiaries have filed or have obtained currently effective extensions with respect to all federal, state, county, local and foreign tax returns which are required to be filed by them, such returns are complete and accurate in all material respects and all taxes shown thereon to be due have been timely paid with exceptions not material to the Company and its Subsidiaries, taken as a whole. No material controversy with respect to taxes of any type with respect to the Company or any of its Subsidiaries is pending or, to the Companys knowledge, threatened. The Company and its Subsidiaries have withheld or collected from each payment made to their employees the amount of all taxes required to be withheld or collected therefrom and have paid all such amounts to the appropriate taxing authorities when due (including, but not limited to, federal income taxes, Federal Insurance Contribution Act taxes and Federal Unemployment Tax Act taxes). Neither the Company nor any of its Subsidiaries has any material tax liability relating to income, properties or assets as of the Closing that is not adequately provided for.

(p)Insurance. The Company and its Subsidiaries maintain insurance of the types and in the amounts that the Company reasonably believes is prudent and adequate for their businesses, all of which insurance is in full force and effect in all material respects. Neither the Company nor any of its Subsidiaries has been refused any insurance coverage sought or applied for by them, and the Company does not have any reason to believe that it will not be able to renew any such existing insurance coverage as and when such coverage expires or to obtain similar coverage from similar insurers as may be necessary to continue its business at a cost that would not have a Material Adverse Effect.

(iii)The Company and its Subsidiaries are in compliance with all federal, state, local and foreign laws and regulations respecting labor, employment and employment practices and benefits, terms and conditions of employment and wages and hours, except where failure to be in compliance would not, either individually or in the aggregate, reasonably be expected to result in a Material Adverse Effect.

(t)No Integrated Offering. Neither the Company, nor any affiliate of the Company, nor, to the Companys knowledge any person acting on its or their behalf has, directly or indirectly, made any offers or sales of any security or solicited any offers to buy any security, under circumstances that would cause this Offering to be integrated with prior offerings by the Company in such a manner that would subject this Offering to the registration requirements of section 5 of the Securities Act.

(u)Investment Company. The Company is not now, and after the sale of the Units under this Agreement and the application of the net proceeds from the sale of the Units will not be, an investment company, a company controlled by an investment company, or an affiliated person of, or promoter or principal underwriter for, an investment company within the meaning of the Investment Company Act of 1940, as amended.

(v)Application of Anti-Takeover Provisions. There is no control share acquisition, business combination, poison pill (including any distribution under a rights agreement) or other similar anti-takeover provision under the Companys Articles of Incorporation (or other charter documents) that would become applicable to the Purchaser as a result of the issuance of the Shares and Warrants.

(i)The Company and its Subsidiaries have complied in all material respects with all applicable Environmental Laws (as defined below). There is no pending or, to the Companys knowledge, threatened civil or criminal litigation, written notice of violation, formal administrative proceeding, or investigation, inquiry or information request by any Governmental Entity, relating to any Environmental Law involving the Company or any of its Subsidiaries. Environmental Law means any federal, state, local or foreign law, statute, rule or regulation or the common law relating to the environment or occupational health and safety, including any statute, regulation, administrative decision or order pertaining to (A) treatment, storage, disposal, generation and transportation of industrial, toxic or hazardous materials or substances or solid or hazardous waste; (B) air, water and noise pollution; (C) groundwater and soil contamination; (D) the release or threatened release into the environment of industrial, toxic or hazardous materials or substances, or solid or hazardous waste, including emissions, discharges, injections, spills, escapes or dumping of pollutants, contaminants or chemicals; (E) the protection of wild life, marine life and wetlands, including all endangered and threatened species; (F) storage tanks, vessels, containers, abandoned or discarded barrels and other closed receptacles; (G) health and safety of employees and other persons; or (H) manufacturing, processing, using, distributing, treating, storing, disposing, transporting or handling of materials regulated under any law as pollutants, contaminants, toxic or hazardous materials or substances, or oil or petroleum products or solid or hazardous waste. As used above, the terms release and environment shall have the meaning set forth in the federal Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended (CERCLA).

(y)Benefit Plans. Except as set forth in the Disclosure Letter, neither the Company, any of its Subsidiaries or any Plan Affiliate (as defined below) has maintained, sponsored, adopted, made contributions to or obligated itself to make contributions to or to pay any benefits or grant rights under or with respect to any material Employee Benefit Plan (as defined below), whether written, oral, voluntary or pursuant to a collective bargaining agreement or law, under which the Company or any of its Subsidiaries has any unfunded liability, nor has the Company or any of its Subsidiaries otherwise failed to meet any of its material obligations under any Employee Benefit Plan. Plan Affiliate means any person or entity with which the Company or any of its Subsidiaries constitutes all or part of a controlled group of corporations, a group of trades or businesses under common control or an affiliated service group, as each of those terms are defined in Section 414 of the Internal Revenue Code (the Code). Employee Benefit Plan means, collectively, each bonus, deferred compensation, incentive compensation, stock purchase, stock option, severance or termination pay, health or other medical, life, disability or other insurance, supplemental unemployment benefit, profit sharing, pension, retirement, supplemental retirement or other employee benefit plan, program, agreement or arrangement, whether written or unwritten, formal or informal, maintained or contributed to or required to be contributed to by any person for the benefit of any employee or former employee of the Company or its affiliates or their dependents or beneficiaries, as well as the compensation practices and policies regarding vacations, sick leaves, leaves of absence and all perquisites of employment other than those mandated by any legal requirement and shall include to the extent applicable to the Company, without limitation, Employee Pension Benefit Plans (as defined in Section 3(2) of ERISA (as defined below), Employee Welfare Benefit Plan (as defined in Section 3(1) of ERISA) and Multi-employer Plan (as defined in section 3(37) of ERISA)), but shall exclude any such arrangements or perquisites that do not exceed, individually or in the aggregate, $300 per month per any particular person. ERISA means the Employee Retirement Income Security Act of 1974 and any law of any foreign jurisdiction of similar import. The Company has made all matching contributions required pursuant to the terms of the Companys 401(k) plan or otherwise promised to employees (in writing or orally).

(z)Foreign Corrupt Practices Act; Etc. Each of the Company, its Subsidiaries and their respective officers, directors, employees, agents and other persons acting on behalf of the Company or its Subsidiaries are in compliance with and have not violated the Foreign Corrupt Practices Act of 1977, as amended, or any rules and regulations thereunder, or any similar laws of any foreign jurisdiction. To the Company's knowledge, no governmental or political official in any country is or has been employed by, or acted as a consultant to or held any beneficial ownership interest in the Company or any of its Subsidiaries. The Company, its Subsidiaries and their respective officers, directors, employees and agents are in compliance with and have not violated the U.S. money laundering laws or regulations, the U.S. Bank Secrecy Act, as amended by the USA Patriot Act of 2001 (including any recordkeeping or reporting requirements thereunder), or the anti-money laundering laws or regulations of any jurisdiction.

(a)Organization, Good Standing and Qualification. To the extent a Purchaser is an entity, the Purchaser is duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization. The Purchaser has all power and authority required to enter into this Agreement and consummate the transactions contemplated hereby and thereby.

(b)Authorization. The execution of this Agreement and the performance by the Purchaser of the transactions contemplated by this Agreement have been duly authorized by all necessary action on the part of the Purchaser. This Agreement has been duly executed by the Purchaser and constitutes such the Purchasers legal, valid and binding obligation, enforceable in accordance with its terms, except as may be limited by applicable bankruptcy, insolvency, reorganization or other laws of general application relating to or affecting the enforcement of creditors rights generally and the effect of rules of law governing the availability of equitable remedies.

(c)Purchase for Own Account. The Shares and Warrants are being acquired and the Conversion Shares and Warrant Shares will be acquired, without a view to the resale or distribution thereof, except pursuant to sales registered or exempted under the Securities Act and in compliance with applicable federal and state securities laws. The Purchaser represents that it has not been formed for the specific purpose of acquiring the Securities. Notwithstanding the foregoing, the parties hereto acknowledge the Purchasers right at all times to sell or otherwise dispose of all or any part of such Securities in compliance with applicable federal and state securities laws and the laws of any other applicable jurisdiction, and as otherwise contemplated by this Agreement.

(e)Accredited Investor Status. At the time the Purchaser was offered the Units, it was, and at the date hereof it is, an accredited investor as defined in Rule501(a) under the Securities Act and was (and at the date hereof is) resident in the state or other jurisdiction indicated on the signature pages hereof.

(f)Reliance Upon Purchaser Representations. The Purchaser understands that the issuance and sale of the Securities to the Purchaser will not be registered under the Securities Act, the securities laws of any State of the United States or the securities laws of any other applicable jurisdiction, on the ground that such issuance and sale will be exempt from registration under the Securities Act pursuant to Section 4(a)(2) thereof, and exempt from any comparable registration requirement under the securities laws of any other applicable jurisdiction, and that the Companys reliance on such exemption is based on each Purchasers representations set forth herein.

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

Certificates evidencing the Securities shall not contain any legend (i) while a registration statement covering the resale of such security is effective under the Securities Act, (ii) following any sale of such Securities pursuant to Rule 144, or (iii) if such Securities are eligible for sale under Rule 144(b)(1) without reliance on the conditions set forth in rule 144(c)(1) relating to the availability of current public information.

(j)Insufficient Authorized Shares of Common Stock; Reservation of Shares. The Purchaser acknowledges and understands that the Company does not currently have a sufficient number of authorized shares of Common Stock to issue the Conversion Shares issuable upon conversion of the Series B Preferred Stock and the Warrant Shares issuable upon exercise of the Warrants to be issued in the Offering. Following the Closing, the Company shall use commercially reasonable efforts to increase the Companys authorized shares of Common Stock to an amount sufficient to allow the Company to issue all of the shares of Common Stock issuable (i) upon conversion of all outstanding shares of Series B Preferred Stock, (ii) exercise of all outstanding Warrants, and (iii) exercise or conversion, as applicable, of all other outstanding convertible securities of the Company (Convertible Securities); including by filing Articles of Amendment to the Companys Articles of Incorporation with the Secretary of State of the State of Florida (the Articles of Amendment) increasing the Companys authorized Common Stock and/or effecting a reverse split of the shares of Common Stock to permit the issuance of the Conversion Shares and Warrant Shares and all shares of Common Stock issuable upon exercise or conversion of the Convertible Securities. It is understood and agreed that the Company will seek stockholder approval of the Articles of Amendment. It is hereby agreed by each Purchaser that in connection with such stockholder approval, each such Purchaser shall (i) cause all shares owned by such Purchaser, including shares owned by such Purchasers affiliates, representatives and family members, to be voted in favor of the Articles of Amendment, and (ii) take such other action as shall be reasonably necessary to cause the Articles of Amendment to become effective.

(b)Blue Sky. The Company shall, on or before the Closing Date, take such action as the Company shall reasonably determine is necessary in order to obtain an exemption for or to qualify the Shares and Warrants for sale to the Purchasers at the Closing pursuant to this Agreement under applicable securities or "Blue Sky" laws of the states of the United States (or to obtain an exemption from such qualification). The Company shall make all filings and reports relating to the offer and sale of the Securities required under applicable securities or "Blue Sky" laws of the states of the United States following the Closing Date.

(a)Representations and Warranties. Each of the representations and warranties of the Company contained in Section 3 shall be true and correct in all material respects on and as of the Closing Date (provided, however, that such materiality qualification shall only apply to representations or warranties not otherwise qualified by materiality or Material Adverse Effect) with the same effect as though such representations and warranties had been made as of the Closing (except for representations and warranties that speak as of a specific date).

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

(a)Successors and Assigns. The terms and conditions of this Agreement will inure to the benefit of and be binding upon the respective successors and permitted assigns of the parties. Notwithstanding the foregoing, neither the Company nor any Purchaser shall be permitted to assign its rights or obligations under this Agreement without the prior written consent of the Purchasers or the Company, respectively.

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

(f)Notices. Any notices and other communications required or permitted under this Agreement shall be in writing and shall be deemed to have been given (i) when delivered by hand (with written confirmation of receipt); (ii) when received by the addressee if sent by a nationally recognized overnight courier (receipt requested); (iii) on the date sent by facsimile or e-mail of a PDF document (with confirmation of transmission) if sent during normal business hours of the recipient, and on the next business day if sent after normal business hours of the recipient; or (iv) on the third day after the date mailed, by certified or registered mail (in each case, return receipt requested, postage pre-paid). Such communications must be sent to the following addresses (or at such other address for a party as shall be specified in a notice given in accordance with this Section 9(f)):

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

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

(l)Waivers. No waiver by any party to this Agreement of any default with respect to any provision, condition or requirement of this Agreement shall be deemed to be a continuing waiver in the future or a waiver of any other provision, condition or requirement hereof, nor shall any delay or omission of any party to exercise any right hereunder in any manner impair the exercise of any such right accruing to it thereafter.

WHEREAS, Seller is the record owner and holder of 8,000,000 Common Shares, par value $.0001 par value (the Shares), of PRECISE ACQUISITION, INC., a Delaware corporation ("Corporation), which Corporation has 8,000,000 shares of restricted common stock issued and outstanding as of the date of this Agreement. The Corporation has filed an S-1 registration statement with the Securities and Exchange Commission with an effective date of June 29, 2017. The CIK No. is 0001701874\. None of the Sellers shares are registered and therefore are restricted securities.

1. PURCHASE AND SALE OF SHARES. Subject to the terms and conditions of this Agreement, Purchaser agrees to purchase at the Closing and the Seller agrees to sell to Purchaser at the Closing, 8,000,000 of Sellers Shares for a purchase price of Seventy-Five Thousand U.S. dollars and no cents ($75,000.00), (the Purchase Price). Purchaser agrees to wire transfer to an account to be designated by Seller, the sum of Seventy-Five Thousand U.S. dollars and no cents ($75,000.00) to Seller at Closing. Purchaser will wire funds and provide Seller with proof of payment within 24 hours of Closing.

2. EVENT OF DEFAULT. If, in the event Purchaser shall fail to make and evidence to Seller payment of the purchase price pursuant to paragraphs No. 1., then this agreement will automatically become null and void without any further notification to Purchaser notwithstanding that Purchaser in his sole discretion may extend the time for performance of this Agreement if requested by Seller in writing.

If, in the event Purchaser fails to tender the said purchase price per the terms and conditions set forth in paragraph No. 3., then this Agreement will automatically become null and void. Seller in his sole discretion may extend the time for performance of this Agreement if requested by Purchaser in writing. Purchaser may notify Seller through email.

3. CLOSING. The purchase and sale of the Shares shall take place on or before October 9th, 2017; at or before 5:00 PM EST (which time is designated as the Closing). At Closing, Purchaser shall deliver to Seller, in cash, by wire transfer to an account to be designated by Seller, or his nominee for the Purchase Price totaling the amount of Seventy-Five Thousand U.S. dollars and no cents ($75,000.00), which amount shall include any good faith deposits made, if any, and Seller will promptly deliver the following to Purchaser: (A) the certificates representing the Shares transferred hereunder, duly endorsed for transfer to the Purchaser or accompanied by appropriate stock powers, (B) the original of the Certificate of Incorporation and bylaws, (C) all corporate books and records; (D) written resignations of incumbent directors and officers of the Corporation; and (F) an affidavit certifying that all liabilities of the Corporation prior to the Closing date shall be paid in full out of the proceeds of this share purchase.

| c. | 8-K filing for the sale of common stock by Seller. ---|---|--- | d. | Resignation of current director and appointment of new director. ---|---|--- | e. | Schedule 14F & Schedule 13D filing. ---|---|--- | f. | Introduction to PCAOB auditor. ---|---|--- | g. | Introduction to our Rule 419 Escrow Agent ---|---|--- | h. | Introduction to stock Transfer Agent ---|---|--- | i. | Form 3. ---|---|--- | j. | Consult with market maker to file FINRA Form 211. ---|---|--- k. Consult with DTC market participant so shares may be electronically traded. Purchaser will pay DTC market participant.

| (i) | Corporation is a blank check corporation duly organized and validly existing and in good standing under the laws of the State of Delaware and has the corporate power and authority to carry on the business it is now being conducted. Corporation and/or Seller do not require any consent and/or authorization, declaration or filing with any government or regulatory authority to undertake any actions herein; ---|---|---

| (v) | There are no legal actions, suits, arbitrations, or other administrative, legal or governmental proceedings threatened or pending against the Corporation and/or Seller or against the Seller or other employee, officer, director or stockholder of Corporation. Additionally, Seller is not aware of any facts which may/might result in or form a basis of such action, suit, arbitration or other proceeding on any basis whatsoever; ---|---|---

| (ix) | The business and operation of the Corporation has and will be conducted in accordance with all applicable laws, rules, regulations, judgments. Neither the execution, delivery or performance of this Agreement (A) violates the Corporations by-laws, Certificate of Incorporation, Shareholder Agreements or any existing resolutions; and, (B) will cause the Corporation to lose any benefit or any right or privilege it enjoys under the Securities Act (Act) or other applicable state securities laws; ---|---|---

| (x) | Corporation has not conducted any business and/or entered into any agreements with third-parties other than Escrow Agreement with Wilmington Trust, National Association, as escrow agent for the S-1 blank check offering whereas the foregoing escrow agreement is attached as Exhibit 99.1 to the S-1/A registration statement on June 16, 2017; ---|---|---

| (xi) | This Agreement has been duly executed and delivered by Seller constitutes a valid and binding instrument, enforceable in accordance with its terms and does not conflict with or result in a breach of or in violation of the terms, conditions or provisions of any agreement, mortgage, lease or other instrument or indenture to which Corporation and/or Seller a party or by which they are bound; ---|---|---

| (xiii) | Seller warrants that the Corporation being transferred shall be transferred with no liabilities and little or no assets, and shall defend and hold Purchaser and the Corporation harmless against any action by any third party against either of them arising out of, or as a consequence of, any act or omission of Seller or the Corporation prior to, or during the closing contemplated by this contract of sale; and ---|---|---

| (i) | Purchaser has the power and authority to execute and deliver this Agreement, to perform his obligations hereunder and to consummate the transactions contemplated hereby. This Agreement has been duly executed and delivered by Purchaser and constitutes a valid and binding instrument, enforceable in accordance with its terms; ---|---|---

7. NOTICES. Notice shall be given by email at the most recent address last received by Seller from Buyer or by Buyer from Seller. Notice may also be given by certified mail, return receipt requested, the date of notice being deemed the date of postmarking. Notice, unless either party has notified the other of an alternative address as provided hereunder, shall be sent to the address as set forth herein:

8. GOVERNING LAW. This Agreement shall be interpreted and governed in accordance with the laws of the State of Delaware. The parties herein waive trial by jury. In the event that litigation results or arise out of this Agreement or the performance thereof, the parties agree that the prevailing party is entitled to reimbursement for the non-prevailing party of reasonable attorneys fee, costs, expenses, in addition to any other relief to which the prevailing party may be entitled.

19. PUBLICITY. Except as otherwise required by law, none of the parties hereto shall issue any press release or make any other public statement, in each case relating to, connected with or arising out of this Agreement or the matters contained herein, without obtaining the prior approval of the other to the contents and the manner of presentation and publication thereof.

20. INDEMNIFICATION. Seller shall hold Purchaser harmless from any and all claims arising out of or related to (i) actions taken by Seller in her capacity as a shareholder of the Company prior to the payment of the good faith deposit, or (ii) any lawsuits against the Corporation arising during the period of time prior to the payment of the good faith deposit; (iii) any requests, audits or comment letters issued by the Securities and Exchange Commission related to the period of time prior to receipt of the good faith deposit.

This SECURITIES PURCHASE AGREEMENT (the Agreement), dated as of October 2, 2017, by and between Airborne Wireless Network, a Nevada corporation, with headquarters located at 4115 Guardian Street, Suite C, Simi Valley, CA 93063, (the Company), and GS CAPITAL PARTNERS, LLC, with its address at 110 Wall Street, Suite 5-070, New York, NY 10005 (the Buyer).

B. Buyer desires to purchase and the Company desires to issue and sell, upon the terms and conditions set forth in this Agreement three 8% convertible notes of the Company, in the forms attached hereto as Exhibit A through C in the aggregate principal amount of $444,000.00 (with the first note being in the amount of $222,000.00 and two back end notes being in the amount of $111,000.00 each) (together with any note(s) issued in replacement thereof or as a dividend thereon or otherwise with respect thereto in accordance with the terms thereof, the Note), convertible into shares of common stock of the Company (the Common Stock), upon the terms and subject to the limitations and conditions set forth in such Note. The first note shall contain a $22,000 OID such that the aggregate purchase price shall be $200,000. Each back end note shall contain an $11,000 OID such that the purchase price shall be $100,000 each. The first of the three notes (the First Note) shall be paid for by the Buyer as set forth herein. Each of the two remaining $111,000 back end notes shall initially be paid for by the issuance of an offsetting $100,000.00 secured note issued to the Company by the Buyer (a Buyer Note), provided that prior to conversion of a particular back end note, the Buyer must have paid off that particular Buyer Note in cash such that the particular Back End Note may not be converted until it has been paid for in cash by Buyer.

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

a. Investment Purpose. As of the date hereof, the Buyer is purchasing the Note and the shares of Common Stock issuable upon conversion of or otherwise pursuant to the Note, such shares of Common Stock being collectively referred to herein as the Conversion Shares and, collectively with the Note, the Securities) for its own account and not with a present view towards the public sale or distribution thereof, except pursuant to sales registered or exempted from registration under the 1933 Act; provided, however, that by making the representations herein, the Buyer does not agree to hold any of the Securities for any minimum or other specific term and reserves the right to dispose of the Securities at any time in accordance with or pursuant to a registration statement or an exemption under the 1933 Act.

b. Accredited Investor Status. The Buyer is an accredited investor as that term is defined in Rule 501(a) of Regulation D (an Accredited Investor). Any of Buyers transferees, assignees, or purchasers must be accredited investors in order to qualify as prospective transferees, permitted assignees in the case of Buyers or Holders transfer, assignment or sale of the Note.

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

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

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

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

The legend set forth above shall be removed and the Company shall issue a certificate without such legend to the holder of any Security upon which it is stamped, if, unless otherwise required by applicable state securities laws, (a) such Security is registered for sale under an effective registration statement filed under the 1933 Act or otherwise may be sold pursuant to Rule 144 or Regulation S without any restriction as to the number of securities as of a particular date that can then be immediately sold, and (b) such holder provides the Company with an opinion of counsel, in form, substance and scope customary for opinions of counsel in comparable transactions, to the effect that a public sale or transfer of such Security may be made without registration under the 1933 Act, and that legend removal is appropriate, which opinion shall be accepted by the Company so that the sale or transfer is effected. The Buyer agrees to sell all Securities, including those represented by a certificate(s) from which the legend has been removed, in compliance with applicable prospectus delivery requirements, if any. In the event that the Company does not accept the opinion of counsel provided by the Buyer with respect to the transfer of Securities pursuant to an exemption from registration, such as Rule 144 or Regulation S, within 2 business days, it will be considered an Event of Default under the Note.

a. Organization and Qualification. The Company and each of its subsidiaries, if any, is a corporation duly organized, validly existing and in good standing under the laws of the jurisdiction in which it is incorporated, with full power and authority (corporate and other) to own, lease, use and operate its properties and to carry on its business as and where now owned, leased, used, operated and conducted.

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

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

e. No Conflicts. The execution, delivery and performance of this Agreement, the Note by the Company and the consummation by the Company of the transactions contemplated hereby and thereby (including, without limitation, the issuance and reservation for issuance of the Conversion Shares) will not (i) conflict with or result in a violation of any provision of the Certificate of Incorporation or By-laws, or (ii) violate or conflict with, or result in a breach of any provision of, or constitute a default (or an event which with notice or lapse of time or both could become a default) under, or give to others any rights of termination, amendment, acceleration or cancellation of, any agreement, indenture, patent, patent license or instrument to which the Company or any of its subsidiaries is a party, or (iii) result in a violation of any law, rule, regulation, order, judgment or decree (including federal and state securities laws and regulations and regulations of any self-regulatory organizations to which the Company or its securities are subject) applicable to the Company or any of its subsidiaries or by which any property or asset of the Company or any of its subsidiaries is bound or affected (except for such conflicts, defaults, terminations, amendments, accelerations, cancellations and violations as would not, individually or in the aggregate, have a material adverse effect). All consents, authorizations, orders, filings and registrations which the Company is required to obtain pursuant to the preceding sentence have been obtained or effected on or prior to the date hereof. The Company is not in violation of the listing requirements of the OTC marketplace (the OTC MARKETPLACE) and does not reasonably anticipate that the Common Stock will be delisted by the OTC MARKETPLACE in the foreseeable future, nor are the Companys securities chilled by DTC. The Company and its subsidiaries are unaware of any facts or circumstances which might give rise to any of the foregoing.

h. No Integrated Offering. Neither the Company, nor any of its affiliates, nor any person acting on its or their behalf, has directly or indirectly made any offers or sales in any security or solicited any offers to buy any security under circumstances that would require registration under the 1933 Act of the issuance of the Securities to the Buyer.

i. Title to Property. The Company and its subsidiaries have good and marketable title in fee simple to all real property and good and marketable title to all personal property owned by them which is material to the business of the Company and its subsidiaries, in each case free and clear of all liens, encumbrances and defects except such as would not have a material adverse effect. Any real property and facilities held under lease by the Company and its subsidiaries are held by them under valid, subsisting and enforceable leases with such exceptions as would not have a material adverse effect.

j. Bad Actor. No officer or director of the Company would be disqualified under Rule 506(d) of the Securities Act as amended on the basis of being a bad actor as that term is established in the September 19, 2013 Small Entity Compliance Guide published by the Securities and Exchange Commission.

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

a. Expenses. At the Closing, the Company shall reimburse Buyer for expenses incurred by them in connection with the negotiation, preparation, execution, delivery and performance of this Agreement and the other agreements to be executed in connection herewith (Documents), including, without limitation, reasonable attorneys and expenses, fees relating to any amendments or modifications of the Documents or any consents or waivers of provisions in the Documents, and costs of restructuring the transactions contemplated by the Documents limited to legal fees contemplated by the Documents. The Company shall also be responsible for all costs relating to the issuance of the shares issuable upon conversion of the Note.