STOCK PURCHASE AGREEMENT

THIS  STOCK  PURCHASE  AGREEMENT  (“Agreement”),  dated  as  of  November  4,

2015  is  by  and  among WALA  INC.  d/b/a  ARCMAIL  TECHNOLOGY,  a  Louisiana  corporation

(“Company”),    Rory    Welch    (”Seller”)    and    IGAMBIT    INC.,    a    Delaware    corporation

(“Purchaser”).

R E C I T A L S

A.

Company  is  engaged  in  the  business  of  creating  and  providing  email  archiving

and management solutions to customers throughout the United States.

B.

Seller  owns  all  of  the   issued  and  outstanding  shares  of  capital  stock  of  the

Company.

C.

Purchaser  desires  to  Purchase  from  Seller,  and  Seller  desires  to  sell  to  Purchaser,

all of the Purchased Stock upon the terms and subject to the conditions hereinafter set forth.

NOW,   THEREFORE,  in  consideration  of  the  Recitals  and  the   respective  covenants,

agreements,  conditions,  representations and  warranties  hereinafter contained, and  intending to  be

legally bound hereby, Purchaser, and the Seller hereby agree as follows:

1.

DEFINITIONS.

Unless  otherwise  defined  below  in  this  Section  1,  the  various  capitalized  terms  used  in

this Agreement shall have the definitions ascribed to them herein.

“Acquired  Business”  means  the  business  operated  by  the  Company  up  to  the  Closing

Date  including without  limitation  the  creating and  providing of email archiving and management

solutions to customers throughout the United States.

“Agreement” means this Stock Purchase Agreement.

“Audited  Financial  Statements”  means  the  annual  financial  statements  (balance  sheets

statements   of   income   and   retained   earnings,   statement   of   cash   flow   and   supplementary

statements,  together  with  footnotes)  for  the  Company  for  the  fiscal  years  ended  December  31,

2013  and  December  31,  2014  audited,  reviewed  and  prepared  by  a  certified  public  accounting

firm.

“Benefit  Plans”  means  any  pension  plan,  profit  sharing  plan,  bonus  plan,   incentive

compensation   plan,   stock   ownership   plan,   stock   purchase   plan,   stock   option   plan,   stock

appreciation  plan,  employee  benefit  plan,  employee  benefit  policy,  retirement  plan,  deferred

compensation  plan  or  agreement,  cafeteria  plan,  dependent  care  plan,  fringe  benefit  program,

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employee  insurance  plan,  severance  plan  or  agreement,  change  in  control  plan  or  agreement,

employment  agreement  (other  than  the  Employment  Agreements),  disability  plan,  health  care

plan,  sick  leave  plan,  death  benefit  plan,  multi-employer  pension  or  welfare  benefit  plan,  or  any

other  plan or  program to provide retirement  income,  fringe  benefits  or other benefits  to former or

current employees.

“Claim”  means  an  action,  suit,  proceeding,  demand,  claim  or  counterclaim  or  legal,

administrative or arbitral proceeding or investigation.

“Code” means the Internal Revenue Code of 1986, as amended.

“Common  Stock”  means  the  Four  Million  (4,000,000)  authorized  shares  of  common

stock of the Company, without par value.

“Contract”   means   all   agreements,   whether   oral   or   written   and   whether   express   or

implied   (whether   legally   binding   or   not),   including   contracts,   contract   rights,   promises,

commitments,   undertakings,   customer   accounts,   orders,   leases,   guarantees,   warranties   and

representations and franchises to which either the Seller or Company is a party.

“Copyrights”  means  all  copyrights  (whether  or  not  registered),  Moral  Rights,  and  all

registrations  and  applications  for  registration  thereof,  as  well  as  rights  to  renew  copyrights,  in

each  case  that  are  licensed  by  Company  and/or  otherwise  used  in  the  Acquired  Business  as

currently operated.

“Creditors”  means,  those  parties  to  which  either  Seller  or  Company  owes  any  one  or

more  of the liabilities included in the Noteholder Debt amount, as set forth on Schedule 2.8.

“Environmental  Claim”  means any claim,  action, cause  of action, investigation  or notice

by any person  or  entity alleging  liability (including,  without  limitation,  liability for  investigatory

costs,  cleanup costs,  governmental  response  costs,  natural resources  damages,  property damages,

personal  injuries,  or  penalties)  arising  out  of,  based  on  or  resulting  from  (i)  the  presence,  or

release  into  the  environment,  of  any  Material  of  Environmental  Concern  at  any  location,  or  (ii)

any violation, or alleged violation, of any Environmental Laws.

“Environmental  Laws”  means  all  Laws   relating  to  pollution  or  protection  of  human

health  or  the  environment  (including,  without  limitation,  ambient  air,  surface  water,  ground

water,   land   surface   or   subsurface   strata),   including,   without   limitation,   Laws   relating   to

emissions,  discharges,  releases  or  threatened  releases  of  Materials  of  Environmental  Concern,  or

to   the   generation,   manufacture,   processing,   handling,   distribution,   use,   treatment,   storage,

disposal, transport or handling of Materials of Environmental Concern.

“ERISA”   shall   mean   the   Employee   Retirement   Income   Security   Act   of   1974,   as

amended.

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“ERISA  Affiliate”  means a  Person  aggregated  with  another  Person  as  a  single  employer

under any of Sections 414(b), 414(c), 414(m), or 414(o) of the Code.

“Existing  Plans”  means  the  existing  Benefit  Plans  of  the  Company  listed  and  described

on Schedule 3.24.

“Financial  Statements”  means  the  Audited  Financial  Statements  and  Interim  Financial

Statements, collectively.

“GAAP” means United States generally accepted accounting principles.

“Governmental     Authorities”    means     all    agencies,    authorities,     bodies,     boards,

commissions,  courts,  instrumentalities,  legislatures  and  offices  of  any  nature  whatsoever  of  any

government,  quasi-governmental  unit  or  political  subdivision,  whether  foreign,  federal,  state,

county, district, municipality, city or otherwise (each, a “Governmental Authority”).

“Holdback  Amount”  means  One  Million  (1,000,000)  iGambit  Common  voting  shares  as

defined in Section 2.3(a).

“Indebtedness”   means   all   liabilities   or   obligations   of   the   relevant   Person,   whether

primary  or  secondary  or  absolute  or  contingent:  (a)  for  borrowed  money;  (b)  evidenced  by

notes,  bonds,  debentures,  guaranties  or similar  obligations;  (c)  under  leases  which  in  accordance

with  GAAP  constitute  capital  leases;  (d)  secured  by  liens  on  any  assets  of  that  Person;  or  (e)

resulting from cash, book or bank overdrafts.

“Intellectual   Property”   means   all   (i)   Patents,   (ii)   Know-how,   (iii)   Trademarks,  (iv)

Copyrights,  (v)  Software  Programs  (including  but  not  limited  to  “off-the-shelf”  shrink-wrap  and

click-wrap  software programs), in each case  that  are  licensed by Company and/or  otherwise  used

in  the  Acquired  Business  as  currently operated,  and  (vi)  all  other  intellectual  property rights  and

industrial   property  rights   (of   every   kind   and   nature   throughout   the   universe   and   however

designated), whether arising by operation of law, contract, license or otherwise, in each case that

are licensed by Company and/or otherwise used in the Acquired Business as currently operated.

“Intellectual   Property   Rights”   means,   collectively,   any  and   all   known   or   hereafter

known  tangible  and  intangible  rights  under  patent,  trademark,  copyright  and  trade  secret  laws,

and  any  other  intellectual  property,  industrial  property  and  proprietary  rights  worldwide,  of

every kind and nature throughout the universe, however designated, whether arising by operation

of law, contract, license or otherwise.

“Interim   Financial   Statements”   means   the   unaudited,   internally   prepared   financial

statements  (balance  sheet  and  statement  of  income)  for  the  Company  for  the  period  beginning

January  1,  2015  through  September  30,  2015,  reviewed  and  prepared  by  a  certified  public

accounting firm.

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“Investment”  by  any  Person  means:  (a)  any  transfer  or  delivery  of  cash,  stock  or  other

property  or  value  by  such  Person  in  exchange  for  Indebtedness,  stock  or  any  other  security  of

another  Person;  (b)  any  loan,  advance  or  capital  contribution  to  or  in  any  other  Person;  (c)  any

guaranty,  creation  or  assumption  of  any  liability  or  obligation  of  any  other  Person;  or  (d)  any

investments  in  any  fixed  property  or  fixed  assets  other  than  fixed  properties  and  fixed  assets

acquired and used in the ordinary course of the business of that Person.

“Key  Company  Employees  or  Company  Employees”  means  the  following  employees  of

Company: Rory Welch, Edward Dunn and Philip Clarke.

“Know-how”  means   any  and   all   product   specifications,  processes,   methods,  product

designs,  plans,  trade  secrets,  ideas,  concepts,  inventions,  manufacturing,  engineering  and  other

manuals  and  drawings,  physical  and  analytical,  safety,  quality  control,  technical  information,

data,  research  records,  all promotional  literature, customer and  supplier lists and similar  data and

information,  which,  in each case, are  licensed  to  or owned by Company and/or  otherwise  used  in

the  Acquired  Business  as  currently  operated;  and  any  and  all  other  confidential  or  proprietary

technical and business information which are licensed to or owned by Company and/or otherwise

used in the Acquired Business as currently operated.

“Knowledge” means, with  respect  to a  given matter the actual  knowledge  of the Seller,  or

any  officer  of  Company,  or  the  knowledge  that  the  Seller,  or  any  officer  of  Company,  should

possess in the exercise of reasonable diligence and investigation with respect to the matter.

“Liability”  means   any  direct  or  indirect  indebtedness,  liability,  assessment,   expense,

claim,  loss,  damage,  deficiency,  obligation  or  responsibility,  known  or  unknown,  disputed  or

undisputed,  joint  or  several,  vested  or  unvested,  executory  or  not,  fixed  or  unfixed,  choate  or

inchoate,  liquidated  or  unliquidated,  secured  or  unsecured,  determinable  or  undeterminable,

accrued  or  unaccrued,  absolute  or  not,  actual  or  potential, contingent  or  otherwise  (including  but

not  limited  to  any  liability  under  any  guarantees,  letters  of  credit,  performance  credits  or  with

respect to insurance loss accruals).

“Law” means any federal, state,  local,  foreign,  provincial or  other governmental  law, rule

or regulation of any kind, and any and all rules and regulations promulgated thereunder.

“Liens”  means  (i) liens  arising in the  ordinary course  of  the  business  by operation of  law

for   amounts   not   yet   due   in   favor   of   carriers,   warehousemen,   mechanics,   landlords   and

materialmen and (ii) liens for Taxes which are not yet due or payable.

“Leased   Real   Estate”   means   the   real   property   subject   to   the   Real   Estate   Leases,

including all buildings, structures, improvements and fixtures thereon.

“Material  Adverse  Effect”  means  any  material  adverse  change  in  or  effect  upon  (a)  the

financial  condition,  assets,  liabilities,  or  operations  of  (x) the  Company taken  as a whole, (y)  the

Acquired  Business  of  the  Company and  the Company assets  (taken as a  whole), or (b)  the  ability

of  the  Seller to execute, deliver  and  perform  this  Agreement, provided that none of the  following

shall   be   deemed   to   constitute,   and   none   of   the   following   shall   be   taken   into   account   in

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determining  whether  there  has  been,  a  Material  Adverse  Effect:  any  adverse  change,  event,

development,  or  effect  arising  from  or  relating  to  (i)  general  business  or  economic  conditions,

including  such  conditions  which  affect  the  Acquired  Business  industry  generally  (provided  they

do  not  have  a  materially  disproportionate  effect  on  the  Company,  as  a  whole),  (ii)  national  or

international   political   or   social   conditions,   (iii)   financial,   banking,   or   securities   markets

(including  any  disruption  thereof  and  any  decline  in  the  price  of  any  security  or  any  market

index),  (iv)  changes  in  United  States  generally accepted  accounting  principles,  or  (v)  changes  in

law,  rules,  regulations,  orders,  or  other  binding  directives  issued  by any governmental  authority,

provided they do not have a materially disproportionate effect on the Company.

“Materials  of  Environmental  Concern”  means  any  substance  or  material  that  is  on  the

date  hereof  or  on  the  Closing  Date  prohibited,  controlled  or  regulated  by  any  governmental

authority  under  any  Environmental  Laws,  including,  without  limitation,  chemicals,  pollutants,

contaminants,  wastes,  toxic  substances,  hazardous  substances,  petroleum,  petroleum  derivatives

or   other   hydrocarbons,   petroleum   products,   dangerous   substances,   designated   substances,

controlled products or subject waste, all as defined in or pursuant to any Environmental Laws.

“Noteholder   Debt”   means   all   note   holder   debt   of   Company   to   certain   Creditors

described  in  that  certain  Stock  Purchase  and  Redemption  Agreement,  Promissory  Notes  and

Security   Agreements   dated   September   1,   2014   by   and   between   Wala   Inc.,   d/b/a   Arcmail

Technology,  Rory  Welch  and  those  entities  and/or  individuals  listed  in  the  Stock  Purchase  and

Redemption  Agreement,  Promissory  Notes  and  Security  Agreements,  (the  “Noteholders”)  as  set

forth on Schedule 2.8.

“Moral  Rights”  means,  collectively,  rights  to  claim  authorship  of  a  work,  to  object  to  or

prevent  any  modification  of  a  work,  to  withdraw  from  circulation  or  control  the  publication  or

distribution  of  a  work,  and  any similar  rights,  whether  existing  under  judicial  or  statutory law  of

any  country  or  jurisdiction  worldwide,  or  under  any  treaty  or  similar  legal  authority,  regardless

of whether such right is called or generally referred to as a “moral right.”

“Owned  Real Estate”  means the  real  property,  if any,  titled  in the  name  of the  Company,

together   with   all   buildings,   structures,   improvements   and   fixtures   thereon   and   all   rights

pertaining thereto.

“Patents”   means   all   patents,   patent   disclosures   and   patent   applications   (including,

without   limitation,   all   reissues,   divisions,   continuations,   continuations-in-part,   renewals,   re-

examinations   and   extensions   of   the   foregoing)   owned   by   or   licensed   to   Company   and/or

otherwise used in the Acquired Business as currently operated.

“PBGC” means the Pension Benefit Guaranty Corporation.

“Permitted  Liens”  means: (i)  the  Noteholder  Debt  and  liens  associated  therewith  and  (ii)

with respect to Licensed Intellectual Property, the rights held by the applicable licensors thereof.

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“Person”    means    any    individual,    corporation,    joint    venture,    partnership,    limited

partnership,  limited  liability  company,  limited  liability  partnership,  syndicate,  trust,  association,

entity or government or political subdivision, agency or instrumentality of a government.

“Preferred  Stock”  means  the  One  Million,  Fifty  Thousand    (1,050,000)    authorized

shares of Series A preferred stock of the Company, with a par value ($0.10) and a face amount of

Three   and   50/100   dollars   ($3.50),   (“Series   A   Preferred’),   and   Two   Million   (2,000,000)

authorized  shares  of  Series  B  preferred  stock  of  the  Company,  with  a  par  value  ($0.10)  and  a

face amount of Two and 50/100 dollars ($2.50), (“Series B Preferred’).

“Purchased  Stock”  means  collectively,  all  of  the  issued  and  outstanding  shares  of  the

Preferred Stock, as set forth in Section 3.2(d)(i).

“Real   Estate   Leases”   means   the   real   estate   leases,   subleases   and   other   occupancy

agreements to which the Company is a party listed separately as set forth on Schedule 3.10(a).

“Software   Programs”   means   all   of   the   Company’s   computer   software   programs,

products and services included in the Intellectual Property, including all program code, databases

and documentation, without regard to form of media or storage.

“Taxes”  means:  (1)  any  and  all  taxes,  fees,  levies,  duties,  tariffs,  imposts  and  other

charges  of  any  kind,  imposed  by  any  Governmental  Authority  or  taxing  authority,  including

taxes  or  other  charges  on,  measured  by,  or  with  respect  to  income,  franchise,  windfall  or  other

profits,  gross  receipts,  property,  sales,  use,  capital  stock,  payroll,  employment,  social  security,

workers’  compensation,  unemployment compensation  or  net  worth;  taxes  or  other  charges  in  the

nature  of  excise,  withholding,  ad  valorem,  stamp,  transfer,  value-added  or  gains  taxes;  license,

registration  and  documentation  fees;  and  customers’  duties,  tariffs  and  similar  charges;  (2)  any

Liability  for  the  payment  of  any  amounts  of  the  type  described  in  (1)  as  a  result  of  being  a

member  of an  affiliated,  combined,  consolidated  or  unitary group  for  any taxable  period;  (3) any

Liability  for  the  payment  of  amounts  of  the  type  described  in  (1)  or  (2)  as  a  result  of  being  a

transferee  of,  or  a  successor  in  interest  to,  any  Person  or  as  a  result  of  an  express  or  implied

obligation  to  indemnify  any  Person;  and  (4)  any  and  all  interest,  penalties,  additions  to  tax  and

additional  amounts  imposed  in  connection  with  or  with  respect  to  any  amounts  described  in  (1),

(2) or (3).

“Tax   Return”   means   any   return,   report,   statement,   form   or   other   documentation

(including  any  additional  or  supporting  material  and  any  amendments  or  supplements)  filed  or

maintained,  or  required  to  be  filed  or  maintained,  with  respect  to  or  in  connection  with  the

calculation, determination, assessment or collection of any Taxes.

“Trademarks”  means  (i)  trademarks,  service  marks,  trade  names,  trade  dress,  labels,

logos   and   all   other   names  and   slogans   used   exclusively  with   any  products   or   embodying

associated goodwill of  the Acquired  Business  related to such products,  whether or not  registered,

and  any  applications  or  registrations  therefor,  and  (ii)  any  associated  goodwill  incident  thereto;

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in  each  case  owned  by  or  licensed  to  Company  and/or  otherwise  used  in  the  Acquired  Business

as currently operated.

2.

PURCHASE OF PURCHASED STOCK.

2.1

Stock  Purchased. Subject  to and upon the  terms and conditions set  forth in

this  Agreement,  Seller  will  validly  sell,  transfer,  assign  and  convey  to  Purchaser,  and  Purchaser

will accept and purchase from Seller, on the Closing Date, the Purchased Stock.

2.2

Delivery  of  Stock.  At  the  Closing,  the  Seller  shall  deliver,  transfer  and

assign  all  of  the  Purchased  Stock  to  Purchaser  by delivering  stock  certificates  representing all  of

the  Purchased  Stock  duly  endorsed  or  accompanied  by  stock  powers  duly  executed  in  blank,

with  any  required  transfer  stamps  affixed  thereto,  and  otherwise  in  proper  form  for  transfer,  as

shall   be   necessary  to   vest   in   Purchaser   full,   complete,   good   and   marketable   title   to   such

Purchased   Stock   free   and   clear   of   all   Liens   (other   than   Permitted   Liens),   claims   and

encumbrances   of   any   kind   whatsoever,   all   such   documents   to   be   in   form   and   substance

satisfactory to counsel for Purchaser.

2.3

Purchase  Price.  The  “Purchase  Price”  to  be  paid  by  Purchaser  to  the

Seller  for  the  Purchased  Stock  shall  be  referred  to  as  the  “Shares”  and  is  composed  of  the

following:

(a) 10,500,000 of iGambit Inc.’s Common voting shares to the Seller,

and/or Seller’s designees at Closing; plus

(b)   the Holdback Amount.

2.4

[Intentionally Omitted

2.5

[Intentionally Omitted

2.6

Closing.

(a)

Time  and  Place.  Subject  to  the  terms  and  conditions  of  this  Agreement,

the  sale  and  purchase  of  the  Purchased  Stock  contemplated  hereby  (the  “Closing”)  shall  take

place  at  the  offices  of  iGambit  Inc.,  1050  W.  Jericho  Tpke.,  Suite  A,  Smithtown,  New  York,

11787,  within  three  (3)  days  of  the  satisfaction  (or  waiver,  as  applicable),  of  the  conditions  to

Closing  set  forth  in  Section  8  hereof,  or  at  such  other  time,  date  or  place  as  the  parties  hereto

may mutually agree  upon  in  writing  hereof,  or  remotely  by exchanging  executed  counterparts  of

this  Agreement,  and  the  other  agreements,  instruments,  certificates  and  other  documents  to  be

entered  into,  or  delivered,  in  connection  herewith  or  therewith  (collectively,  the  “Transaction

Documents”),  and  delivery  of  the  Purchase  Price.  The  time  and  date  of  the  Closing  are  herein

referred  to  as  the  “Closing  Date,”  and  the  term  “Closing  Date”  shall  include  the  date  on  which

the transactions contemplated hereunder are consummated.

7

(b)

Deliveries by Purchaser  to  the  Seller.    At  the  Closing,  Purchaser  (or  its

designee) shall deliver or cause to be delivered each of the following:

(i)

instructions   to   its   transfer   agent   to   issue   certificates,

registered  in  the  name  of  the  Seller  or  Seller’s  designee  in  the  amount  of  11,500,000  of  iGambit

Inc.’s  duly  authorized,  validly  issued,  fully  paid  and  non-assessable  Common  Voting  Shares;

such  shares  shall  be  issued  in  two  certificates,  one  certificate  for  10,500,000  Shares  and  one

certificate  for  the  Holdback  Amount  of  1,000,000  Shares,  and  the  Purchaser  shall  instruct  its

transfer  agent  to  cause  the  Certificates  to  be  deposited  with  Ayres,  Shelton,  Williams,  Benson  &

Paine,  LLC  (the  “Escrow  Agent”)  in  an  escrow  account  (the  “Shares  in  Escrow”),  which  the

Escrow  Agent   shall  hold  pursuant  to  the  provisions  of  an  escrow  agreement  (the  “Agreed

Shares  Escrow  Agreement”)  in  such  form  as  may  be  agreed  by  the  parties  hereto  prior  to

Closing and thereafter attached hereto as Exhibit 2.6(b)(1).

The   Shares   in   Escrow   shall   remain   with   the   Escrow   Agent   as   collateral   to   the

Noteholders  in  connection  to  the  Stock  Purchase  and  Redemption  Agreement,  Promissory  Notes

and  Security  Agreements  dated  September  1,  2014  by  and  between  the  Company,  Seller  and

those  entities  and/or  individuals  listed  in  the  Stock  Purchase  and  Redemption  Agreement  in

consideration  of  the  consent  of  the  holders  of  the  Noteholder  Debt,  which  waive  restrictions  on

the  transfer  of  the  Purchased  Stock.  The  Escrow  Agent  shall  release  any  remaining  Shares  to

Seller upon repayment of all such debt obligation.

(ii)

The Employment  Agreements (as  defined herein), executed

by the Purchaser;

(iii)      A  Certificate  of  the  Secretary  of  Purchaser  showing  the

signatures  of  those  officers  of  Purchaser,  respectively,  authorized  to  sign  this  Agreement,  the

Employment  Agreement,  and  all  other  Transaction  Documents  on  behalf  of  Purchaser  certifying

that said signatures are the signatures of said authorized officers;

(iv)

Good  standing  certificates  of  Purchaser,  dated  no  earlier

than  ten  (10)  calendar  days  prior  to  the  Closing  Date,  certifying  that  Purchaser  is  in  good

standing in the State of Delaware;

(v)

Resolutions   of   the   shareholders   (if   necessary)   and   the

directors  of  Purchaser  certified  by  the  Secretary  of  Purchaser  as  having  been  duly  and  validly

adopted  and  as  being  in  full  force  and  effect  on  the  date  hereof,  authorizing  the  execution  and

delivery  by  Purchaser  of  this  Agreement  and  other  Transaction  Documents,  and  authorizing  the

performance by Purchaser of the transactions contemplated hereby and thereby;

(vi)

A   duly   executed   certificate   of   Purchaser   described   in

Section 7.1 hereof; and

8

(vii)     All   other   documents   necessary   or   appropriate,   in   the

reasonable  opinion  of  Seller,  to  effectuate  the  purchase  and  sale  of  Purchased  Stock  at  the

Closing in accordance with the provisions of this Agreement.

(c)

Deliveries by the Seller.  At  Closing, the Seller shall  deliver or cause to be

delivered to the Purchaser (or its designee) each of the following:

(i)

the    certificates,    documents   and   instruments   of   transfer   and

conveyances  set  forth  in  Section  2.2  of  this  Agreement  duly  endorsed  or  executed  by the  Seller,

as provided therein;

(ii)

A  Certificate  of  the  Secretary  of  Company  showing  the  signatures

of  those  officers  of  Company,  authorized  to  sign  this  Agreement  on  behalf  of  Company  and

certifying that said signatures are the signatures of said authorized officers;

(iii)      A copy of  the  Articles of  Incorporation and  By-Laws  of  Company,

together with  all  amendments and  supplements  thereto, certified by the  Secretary of Company as

being true and complete in all material respects;

(iv)

Good  standing  certificates  of  Company  dated  no  earlier  than  ten

(10)  calendar days  prior  to  the  Closing  Date,  certifying  respectively (i)  that  Company is  in  good

standing  in  the  State  of  Louisiana  and  is  qualified  to  do  business  in  the  State  of  Louisiana;  (ii)

that  Seller  is  qualified  to  do  business  in  all  of  the  other  states  in  which  Company  then  does

business;

(v)

Resolutions   of   the   shareholders   and  the   directors  of   Company

certified  by  the  Secretary  of  Company  as  having  been  duly  and  validly  adopted  and  as  being  in

full  force  and  effect  on  the  date  hereof,  authorizing  the  execution  and  delivery  by  Seller  of  this

Agreement  and  other  Transaction  Documents,  and  authorizing  the  performance  by  Seller  of  the

transactions contemplated hereby and thereby;

(vi)

A   duly   executed   certificate   of   Seller   described   in   Section   8.3

hereof;

(vii)     Duly  executed   employment  agreement  from   the  Key  Company

Employees  in  a  form  attached  hereto  as  Exhibit  2.3(c)(vii)  (the  “Employment  Agreements”)

which  shall  provide  a  minimum  three  (3)  year  term,  and  shall  provide  that  such  Key  Company

Employees  will  participate  in  the  programs  generally  offered  to  the  Purchaser’s  executive  team

with respect to performance bonuses, medical benefits, insurance and the like;

(viii)    [Intentionally Omitted];

(ix)

[Intentionally Omitted];

(x)

[Intentionally Omitted];

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(xi)      Duly  executed  written  consents  from  each  of  the  parties  to  each  of

the  Significant  Contracts  referred  to  in  Section  3.13  and  set  forth  on  Schedule  3.13,  attached

hereto,  to  the  extent  such  consent  is  required  pursuant  to  the  terms  thereof,  in  such  form  as

Purchaser shall in the exercise of reasonable discretion determine (collectively, the “Consents”);

(xii)     Duly  executed  assignments  of  the  existing  Leases  referred  to  on

Schedule  3.10(a)  attached hereto, from Company to  Purchaser, in  form and  substance  reasonably

satisfactory to Purchaser, and the consent of the landlord under such Lease to such assignment;

(xiii)     Duly    executed    confidentiality    agreements    from    each

of

Company’s  employees  that  are  offered  and  accept  employment  with  the  Purchaser  (other  than

Key   Company   Employees,   whose   non-competition   obligations   shall   be   set   forth   in   the

Employment  Agreement  )  in  a  form  satisfactory  to  Purchaser  (collectively,  the  “Confidentiality

Agreements”);

(xiv)     [Intentionally Omitted];

(xv)      the  original  corporate  record  books  and  stock  record  books  of  the

Company; and

(xvi)     All  other  documents  necessary  or  appropriate,  in  the  reasonable

opinion  of  Purchaser,  to  effectuate  the  purchase  and  sale  of  the  Purchased  Stock  at  the  Closing,

free  and  clear  of  all  Liens  (other  than  Permitted  Liens),  in  accordance with  the  provisions  of  this

Agreement.

2.7

Further   Assurances.   In   addition   to   the   actions,   documents   and   instruments

specifically  required  to  be  taken  or  delivered  hereby,  prior  to  and  after  the  Closing  and  without

further  consideration, each  party shall  execute,  acknowledge and  deliver such  other assignments,

transfers,  consents and  other documents and  instruments and take  such  other actions  as any party

or  its/his  counsel  may  reasonably  request  to  complete  and  perfect  the  transactions  contemplated

by this Agreement.

3.  REPRESENTATIONS AND WARRANTIES OF THE SELLER.

The  Seller  represents and  warrants  to  Purchaser  that the  following representations

and warranties are true and correct  in all material respects on the date  hereof and will be true and

correct  in  all  material  respects  on  and  as  of  the  Closing  Date,  except  as  modified  by    the

schedules attached hereto:

3.1

Ownership of Purchased Stock; Authority; Consents.

(a)  Ownership.  Except  for  Permitted  Liens,  Seller  is  the  owner  of,  and  has  good

and  marketable  title  to,  that  number  of  the  shares  of  Purchased  Stock  as  is  set  forth  in  Schedule

3.2(d),  attached  hereto,  as  being  owned  by  such  Seller,  free  and  clear  of  all  liens,  claims  and

encumbrances,  and  has  full  legal  title  and  power  and  the  authorizations and  approvals  necessary

10

to  sell,  transfer  and  deliver  such  shares  of  the  Purchased  Stock  to  Purchaser.  Seller  has  not

granted  a  currently effective  power  of  attorney or  proxy  to  any Person  with  respect  to  all  or  any

portion  of  its  shares  of  the  Purchased  Stock.  Upon  delivery  of  the  certificates  for  such  shares  of

Purchased   Stock   by   Seller   pursuant   to   this   Agreement,   Purchaser   will   acquire   good   and

marketable  title  to  such  shares  of  Purchased   Stock,  free  and  clear  of  all  liens,  claims  and

encumbrances.

(b)  Authority.   Seller  has   all   requisite   power   and  authority  to   enter   into   this

Agreement,  and  the  related  agreements  referred  to  herein,  and  to  carry  out  Seller’s  obligations

hereunder.  The  execution  and  delivery  by Seller  of  this  Agreement  and  the  other  documents and

instruments  to  be  executed  and  delivered  by  Seller  pursuant  hereto  and  the  consummation  by

Seller  of  the  transactions  contemplated  hereby  and  thereby  has  been  duly  authorized  by  Seller.

This  Agreement  and  the  related  agreements,  documents  and  instruments  referred  to  herein  have

been  duly  executed  and  delivered  by  Seller  who  is  a  party  thereto  and  constitutes  the  valid  and

legally   binding   obligations   of   Seller,   enforceable   against   Seller   in   accordance   with   their

respective terms.

(c)   Consents.   No   consent,   approval,   authorization   or   order   of   any   court,

governmental  agency  or  body  is  required  for  the  consummation  by  Seller  of  the  transactions

contemplated  by  this  Agreement,  except  those  set  forth  in  Schedule  3.1(c)  or  Schedule  3.13,

attached  hereto.  Except  as  disclosed  on  Schedule  3.1(c)  or  Schedule  3.13,    the    execution,

delivery   and   performance   by   the   Company   and   the   Seller   of   this   Agreement,   and   the

consummation  by the  Company and  the  Seller  of  the  transactions  contemplated  hereby,  does  not

and will not, with or without the giving of  notice or the  lapse of time  or both, require the consent

of  any  third  party  under  any  contract,  agreement,  lease  or  license  to  which  the  Company  or  the

Seller is a party.

3.2

Corporate Matters.

(a)

Organization  and  Qualification;  Power.  The  Company  is  a  corporation

duly  organized,  validly  existing  and  in  good  standing  under  the  Laws  of  the  State  of  Louisiana.

The Company is duly qualified and/or  licensed,  as the case may be,  and in good  standing in  each

of  the  jurisdictions  listed  on  Schedule  3.2(a),  attached  hereto,  which  are  the  only  jurisdictions

where the nature of its activities or the character of the properties owned, leased or operated by it

require  such  qualification  or  licensing.  The  Company  has  all  requisite  corporate  power  and

authority to  own,  lease  and  operate  all  of  its properties  and  assets and  to  carry on  its  business  as

it is now being conducted.

(b)

Subsidiaries.  The  Company  has  no  subsidiaries  and  does  not  own  any

stock, limited liability company interests or other equity interests in any Person.

(c)

Compliance;  Binding  Effect.  Except  as  provided  on  Schedule  3.2(c),  the

execution and delivery of this  Agreement and the related agreements, documents and  instruments

referred  to  herein,  and  the  consummation  of  the  transactions  contemplated  hereby,  will  not:  (i)

11

violate any provision  of  the  Articles of Incorporation or Bylaws of the Company;  (ii)  constitute a

default  under,  or  constitute  an  event  which  with  the  giving  of  notice  or  the  lapse  of  time  or  both

would  become  a  default  under, or  result in  the  creation  or imposition  of  any lien,  charge,  pledge,

security  interest  or  other  encumbrance  upon  any  of  the  assets  of  the  Company  under,  or  create

any  rights  of  termination,  cancellation,  purchase,  or  acceleration  in  any  Person  under,  any

mortgage,  lien,  lease,  agreement  or  other  instrument  or  obligation  to  which  the  Company  is  a

party or  by which  the  Company  or  its  assets  are  bound;  or  (iii)  violate  or  conflict with  any Law,

order,  writ,  injunction,  judgment,  arbitration  award,  decree  or  other  restriction  of  any  kind  or

character to which the Company or its assets are subject or bound.

(d)

Capitalization of the Company; Ownership of Common Stock.

(i)  The  entire  authorized  capital  stock  of  the  Company  consists  of  the

Preferred  Stock,  of  which,  one  thousand  (1,000)  shares  of  Series  A  Preferred  are  issued  and

outstanding,  no  shares  of  Series  B  Preferred  are  issued  and  outstanding,  and  Common  Stock,  of

which  no  shares  are  issued  and  outstanding.  Seller  is  the  sole  owner  of  record  of  the  issued  and

outstanding  one  thousand  (1000)  shares  of  Series  A  Preferred  Stock  ,who  is  the  only  owner  of

any  equity  interest  in  the  Company.  All  of  the  issued  and  outstanding  shares  of  the  Preferred

Stock  and  Common  Stock  have  been  duly  authorized  and  validly  issued,  are  fully  paid  and

nonassessable  and  are  owned  of  record  by  the  Seller  as  set  forth  in  Schedule  3.2(d),  attached

hereto,  and  except  for  the  Permitted  Liens  are  free  and  clear  of  all  liens,  claims,  encumbrances

and  restrictions  whatsoever.  The  Company  has  complied  with,  and  is  in  material  compliance

with,  all  applicable  securities  Laws,  including  without  limitation  with  respect  to  the  issuance,

sale and/or the repurchase of any shares of Preferred Stock and Common Stock.

(ii)  There  are  no  outstanding  options,  warrants,  conversion  rights  or  other

rights  to  subscribe  for  or  purchase,  or  other  contracts  with  respect  to,  any  capital  stock  of  the

Company  pursuant  to  which  the  Company  is  or  may  become  obligated  to  issue  or  redeem  or

exchange any shares of the Company’s capital stock.

(e)

Articles    of    Incorporation;    Bylaws;    Minute    Books;    Records.    The

Company  has  heretofore  delivered  to  Purchaser  true  and  complete  copies  of  the  Articles  of

Incorporation   and  Bylaws  of   the  Company,   as   amended  and  in  effect  on  the   date  of   this

Agreement.   The   minute   books   of   the   Company   which   heretofore   have   been   provided   to

Purchaser  for  examination  contain  complete  and  accurate  records  of  all  written  corporate  action

taken  by  the  board  of  directors  and  stockholders  of  the  Company  through  the  date  hereof,  and

completely  and  accurately  reflect  all  transactions  in  the  shares  of  capital  stock  of  the  Company.

The  accounting  books  and  records  of  the  Company are  complete  and  correct  and  are  maintained

in  a  manner  consistent  with  past  practice.  The  officers  and  directors  of  the  Company  as  of  the

date of this Agreement are as set forth in Schedule 3.2(e), attached hereto, to this Agreement.

3.3

Authority;   Validity.   The   execution   and   delivery   by   the   Company   of   this

Agreement   and  the   other   documents  and   instruments   to  be   executed   and  delivered   by  the

Company   pursuant   hereto   and   the   consummation   by   the   Company   of   the   transactions

12

contemplated   hereby  and   thereby  have   been   duly  authorized   by  the  Company.   Other   than

instruments  required  pursuant  to  this  Agreement,  no  further  corporate  act  or  proceeding  on  the

part  of  the  Company  is  necessary  to  authorize  this  Agreement  or  the  other  documents  and

instruments  to  be  executed  and  delivered  by the  Company  pursuant  hereto  or  the  consummation

by  the  Company  of  the  transactions  contemplated  hereby  and  thereby.  This  Agreement  and  the

related  agreements,  documents  and  instruments  referred  to  herein  to  which  the  Company  is  a

party have been duly executed and delivered by the Company and constitute the valid and legally

binding  obligations  of  the  Company,  enforceable  against  the  Company  in  accordance  with  their

respective terms.

3.4

Financial.   The   Seller   previously  furnished   to   Purchaser   materially  true     and

correct  copies  of the  Company’s  Financial  Statements,  copies  of all  of which  are  attached  hereto

as  Schedule  3.4.  Except  as  indicated  in  Schedule  3.4  attached  hereto,  the  Financial  Statements

were  prepared  in  accordance  with  GAAP  consistently  applied  through  the  applicable  periods

involved   (except   that   the   Interim   Financial   Statements   are   subject   to   normal   year-end

adjustments  and  do  not  include  footnotes),  and  present  fairly  the  financial  condition  of  the

Company as of the  respective dates of such  Financial Statements and the results of operations for

the  respective  periods  then  ended.  Since  December  31,  2012,  there  has  been  no  change  in  the

accounting  methods  or  practices  of  the  Company,  no  change  in  the  Company’s  policies  with

respect to depreciation or amortization including useful lives of assets or rates for depreciation or

amortization,  and  no  change  in  the  Company’s  policies  with  respect  to  pricing  inventory  or

capitalizing costs.

3.5

Absence of Changes.

(a)

Except   as   set   forth   in   Schedule   3.5,   attached   hereto,   and   except   as

disclosed  in  the  Financial  Statements,  since  January  1,  2013,  there  has  been  no  (i)  adverse

change  in  the  business,  property  or  condition  (financial  or  otherwise)  or  results  of  operations  of

the   Company,   either   individually   or   taken   as   a   whole,   from   that   shown   in   the   Financial

Statements,  (ii)  damage,  destruction  or  loss  (whether  or  not  covered  by  insurance)  which  singly

or  in  the aggregate  adversely affects  the  Company’s  assets  or  the  business  or  financial  condition

of   the   Company,   (iii)   commitment   to   increase   or   effected   increase   in   either   the   rate   of

compensation  or  the  actual  compensation  payable  or  to  become  payable  by  the  Company  to  any

of  its  officers  or  employees  over  the  amount  paid  for  the  fiscal  year  ended  December  31,  2014,

(iv)  new  contract,  agreement,  license  or  transaction  or  termination  of  any  previously  existing

contract,  agreement  or  license  other  than  in  the  ordinary  course  of  business,  (v)  actual  or,  to  the

Knowledge   of   the   Seller,   threatened   labor   trouble   or   strike   affecting   the   Company,   (vi)

cancellation  or  other written  termination of  a  relationship  with the Company,  or  written notice  to

the  Company  of  a  future  cancellation  or  other  termination  of  a  relationship  with  the  Company,

by  any  single  supplier  or  customer  of  the  Company  who  accounted  for  more  than  2%  of  the

Company’s  purchases  or  sales,  determined  by  reference  to  the  Company’s  fiscal  year  ended

December 31,  2014,  (vii)  commitment  for,  declaration,  setting aside,  or payment  of any dividend

or  other  distribution  in  respect  of  any  of  the  Company’s  capital  stock,  or  (viii)  transaction  or

transactions by the Company outside the ordinary course of business.

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(b)

Except  as set  forth  in  Schedule  3.5,  since  January 1,  2015,  there  has  been

no  direct  or  indirect  redemption,  purchase  or  other  acquisition  by  the  Company  of  any  shares  of

its capital stock.

(c)

Except  as  set  forth  in  Schedule  3.5,  since  January  1,  2015,  the  Company

has  not  granted  or  permitted  any  increase  in  the  compensation  payable  or  to  become  payable  to

any of  the  Company’s  officers  or  employees, or  granted  or  permitted  any increase in  the  benefits

under  any  bonus,  insurance,  pension  or  other  benefit  plan,  payment  or  arrangement  made  to,  for

or  with  any  such  employees  or  officers  (including  without  limitation  any  sale  bonus  or  stay

bonus to employees with respect to the transactions contemplated herein).

3.6

Absence  of  Undisclosed  Liability.  Except  as  set  forth  in  Schedule  3.6

attached hereto, or as disclosed  on the  Financial Statements, to the Knowledge  of the  Seller there

are   no   liabilities   or   obligations   of   any   kind   whatsoever,   whether   direct,   indirect,   accrued,

contingent  or  absolute,  and  whether  or  not  determined  or  determinable  (other  than  the  liabilities

of  the  Company  set  forth  on  the  Financials  Statements),  to  which  the  Company  or  the  Acquired

Business  will  be  subject  following  consummation  of  the  transactions  contemplated  hereby,  and

there  is no  existing claim, condition,  situation  or  set  of circumstances which  could  reasonably be

expected to result in any such liability or obligation.

3.7

Powers  of  Attorney.  Except  as  set  forth  in  Schedule  3.7  attached  hereto,

there  are  no  employees  or  agents  of  the  Company  who  hold  powers  of  attorney  to  act  with

respect to the Company, its assets or the Acquired Business.

3.8

Litigation.   Except   as   set   forth   in   Schedule   3.8   attached   hereto,   the

Company  is  not  bound  by  any  order,  judgment,  stipulation  or  consent  decree  of  any  court  or

governmental  agency  affecting  its  assets,  or  limiting  or  affecting  its  operations;  there  is  no  suit,

action,  or  legal,  administrative,  arbitration  or  other  proceeding  or  governmental  investigation

pending  or,  to  the  Knowledge  of  the  Seller,  threatened  in  writing  that  could  adversely  affect  the

business,   financial   condition   or   assets   of   the   Company;   there   are   no   labor   strikes,   filed

grievances  or  other  labor  troubles  pending  or,  to  the  Knowledge  of  the  Seller,  threatened  against

the  Company,  and  there  is  no  pending  arbitration  proceeding  arising  out  of  any union  agreement

to which  the  Company is or  was  a  party;  there are  not  currently pending or,  to  the Knowledge  of

the  Seller,  threatened  against  the  Company  any  investigations  of  charges  or  complaints,  and

there  are  no  outstanding  uncorrected  or  unresolved  citations,  charges,  complaints,  orders  or

judgments,  issued  or  made  by  any  governmental  agency,  or  by  a  court,  with  respect  to  its

application   or   enforcement   of   the   Laws   relating   to   the   Company’s   business   operations,

environmental  protection,  labor  relations,  employee  safety  and  health,  wages,  hours  and  other

labor  standards,  and  fair  employment;  and  no  judgment  or  pending  or,  to  the  Knowledge  of  the

Seller,  threatened  claim  exists  under  any  applicable  worker’s  compensation  Law  by  reason  of

employment   of   the   employees   of   the   Company   that   is   not   fully   covered   by   worker’s

compensation insurance.

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3.9

Licenses; Compliance With  Laws and Regulations.

(a) Governmental  Licenses.  To  the  Knowledge  of  the  Seller  the  Company

has  all  governmental  licenses  and  permits  necessary  to  conduct  its  business,  and  such  licenses

and  permits  are  in  full  force  and  effect  and  listed  on  Schedule  3.9(a).  Except  as  set  forth  in

Schedule  3.9(a),  no  violations  are  or  have  been  recorded  and  remain  outstanding  in  respect  of

such  licenses or  permits and  no  proceeding  looking  toward the  revocation  or limitation  of  any of

them  is  pending  or  threatened  to  the  Knowledge  or  Seller.  Set  forth  in  attached  Schedule  3.9(a)

is  a  complete  list  of  all  inspection  reports,  complaints,  citations  and  notices  of  violations  or

alleged  violations  received  by  the  Company  within  the  period  of  two  (2)  years  prior  to  the  date

hereof from any governmental agency having jurisdiction over the Company or its business.

(b)   Compliance   With   Laws   and   Regulations.   Except   as   provided   in

Schedule  3.9(b),  attached  hereto,  to  the  Knowledge  of  the  Seller  the  Company  is  in  compliance

with  all  applicable  Laws  relating  to  the  operation  of  its  business  and  its  products,  the  Leased

Real   Estate,   and   its   other   assets,   including,   without   limitation,   all   zoning,   building,   fire,

plumbing,  product,  health  and  safety  Laws  including  applicable  product,  safety  and  consumer

protection  specifications,  guidelines  and  standards,  including  without  limitation  those  related  to

the  lead  content  of  children’s  products,  and  no  notice  has  been  served  upon  it claiming  violation

of   any   of   the   foregoing.   Except   as   provided   in   Schedule   3.10(e)   attached   hereto,   to   the

Knowledge  of  the  Seller  the  Leased  Real  Estate  and  all  buildings  and  improvements  situated

thereon, and the  use  thereof by the  Company complies with  all Laws,  easements and  restrictions,

if any.

3.10     Title to and Condition of Property.

(a)

Real   Property  Used.   The   Leased   Real   Estate,   as   set   forth   on

Schedule  3.10(a)  attached  hereto,  constitutes  all  real  property  used  by  the  Company  in  the

Acquired Business.  The Company does not own any Owned Real Estate.

(b)

Title.   Except   for   the   Permitted   Liens   and   ordinary   Liens,   the

Company  owns  good  and  marketable  title  to,  and  has  undisputed  possession  of,  all  of  its  assets

and  properties, free  and  clear of all  options,  adverse  claims, restrictions, tenancies, debts, claims,

security  interests,  defects  of  title,  mortgages,  liens,  pledges,  charges  or  encumbrances  of  any

nature whatsoever.

(c)

Condition;  Sufficiency.  The  assets  of  the  Company  (together  with

the  Leased  Real  Estate)  constitute  all  of  the  property  relating  to  or  used  or  held  for  use  in

connection  with  the  Acquired  Business  on  this  date,  and  comprise  all  property  necessary  for  the

continued  conduct  of  the  Acquired  Business  after  the  Closing  by  the  Company  as  conducted

prior  to  the  Closing  by  the  Company.  To  the  Knowledge  of  the  Seller,  subject  only  to  ordinary

wear  and  tear,  the  assets  of  the  Company  are  usable  and  used  in  the  Acquired  Business,  have

been well  maintained and  are  in  good  operating condition and  repair.   Since  January 1,  2014,  no

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such asset essential to the operation of the Acquired Business has been destroyed, diverted by the

Company   to   other   uses,   or   otherwise   disposed   of   by   the   Company   without   having   been

adequately replaced.

(d)

Insurance.  The  Company,  the  Acquired  Business,  the  Leased  Real

Estate  and  all  of  the  Company’s  assets  have  been  and  are  insured,  and  will  be  insured  through

the  Closing  Date,  in  the  amounts  and  against  the  risks  set  forth  in  Schedule  3.10(d),  attached

hereto.  The  Company  is  not  in  default  with  respect  to  any  provision  contained  in  any  insurance

policy  for  the  Company  and  has  not  failed  to  give  notice  or  present  any  claim  under  any  such

policy  in  due  and  timely  fashion.  During  the  last  two  years,  the  Company  has  not  had  any

insurance  policy  or  coverage  thereunder  cancelled,  withdrawn  or  not  renewed  by  the  insurer.

The  Company  has  not  received  notice  of  and  the  Seller  are  not  aware  of  any  cancellation  or

threat  of  cancellation  of  such  insurance.  Except  as  set  forth  in  Schedule  3.10(d),  no  property

damage,  personal  injury or  products  liability claims have  been made,  or  are  pending,  against  the

Company  that  are  not  fully  covered  by  insurance  (except  to  the  extent  of  co-insurance  and

deductibles reflected in the applicable insurance policies).

(e)

Leased  Real  Estate. There are  no commenced,  or  to the Knowledge  of  the

Seller,  planned  public  improvements  related  to  the  Leased  Real  Estate  which  may  result  in

special assessments  or area  wide  charges  for  which  the Company  would  be  responsible  as  lessee

of  the  Leased  Real  Estate,  or  which  might  otherwise  adversely  affect  such  Leased  Real  Estate;

no   governmental   agency   or   court   order   has   been   issued   requiring   repairs,   alterations   or

correction  of  any  existing  conditions  of  the  Leased  Real  Estate;  there  is  no  pending  or,  to  the

Knowledge  of  the  Seller,  planned  or  contemplated  condemnation  or  similar  action  or  change  in

any  zoning  or  building  ordinance  affecting  the  Leased  Real  Estate;  to  the  Knowledge  of  the

Seller   there   are   no   structural   or   mechanical   defects   in   the   Leased   Real   Estate,   including

adequacy  and  quality  of  well  and  sanitary  disposal  systems  or  defects  which  are  reasonably

likely  to  result  in  the  discharge  of  pollutants  into  the  environment;  to  the  Knowledge  of  the

Seller  there  is  no  violation  of  or  nonconformance  with  any Law  requiring  or  calling  attention  to

the  need  for  any  work,  repairs,  construction,  alteration  or  installation  affecting  the  Leased  Real

Estate;  to  the  Knowledge  of  the  Seller  all  buildings  and  other  improvements  situated  on  the

Leased Real Estate are located within the boundary lines thereof and any applicable setback lines

without  overlap;  and  to  the  Knowledge  of  the  Seller  no  part  of  the  Leased  Real  Estate  is  located

within  a  flood  or  lakeshore  erosion  hazard  area.  All  of  the  Leased  Real  Estate  has  rights  of

access to public roads.

3.11     Taxes and Tax Returns.

(a)

Except as set forth on Schedule 3.11:

(1)

The  Company  has  timely  filed  or  timely  requested  extensions  to

file  those  Tax  Returns  that  are  currently  due  for  all  taxable  periods  ending  on  or  before  the

Closing  Date  and  all  such  Tax  Returns  are  true,  correct  and  complete.  Copies  of  all  such  Tax

Returns for the periods ending on or after December 31, 2014 have been given to the Purchaser;

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(2)

The Company has  paid  to the appropriate Governmental  Authority,

or  has  established,  in  accordance  with  GAAP  and  consistent  with  past  practice,  accruals  that  are

reflected  on  the Company’s  financial  statements (as  provided  to the  Purchaser  hereunder)  for  the

payment  of  all  Taxes  imposed  on  the  Company  or  for  which  the  Company  could  be  liable,

whether   to   taxing  authorities  or   to  other   persons   (pursuant   to   a   tax   sharing  agreement  or

otherwise) for all taxable periods beginning on or before the Closing Date;

(3)

No   extension   of   time   has   been   requested   or   granted   for   the

Company  to  file  any  Tax  Return  that  has  not  yet  been  filed  or  to  pay  any  Tax  that  has  not  yet

been paid;

(4)

The  Company  has  not  received  notice  of  a  determination  by  a

Governmental  Authority that  Taxes are  owed  by the Company (such determination to be referred

to  as  a  “Tax  Deficiency”)  that  has  not  been  resolved  as  of  the  date  of  Closing  and,  to  the

Company’s Knowledge, no Tax Deficiency is proposed or threatened;

(5)

All   Tax   Deficiencies  have   been   paid  or   finally  settled  and  all

amounts determined by settlement to be owed have been paid;

(6)

Except  in  the  case  of  a  Lien  for  ad  valorem  property  taxes  not  yet

due  and  payable,  there  is  no  unpaid  Tax  (a)  that  constitutes  a  Lien  upon  any  of  the  assets  of  the

Company  or  (b)  for  which  the  Purchaser  would  be  liable  under  applicable  Law  by  reason  of

having acquired the Purchased Stock;

(7)

There   are   no   presently   outstanding   waivers   or   extensions   or

requests  for  waiver  or  extension  of  the  time  within  which  a  Tax  Deficiency  may  be  asserted  or

assessed;

(8)

No  issue  has  been  raised  in  any  examination,  investigation,  audit,

Claim   or   proceeding   relating   to   Taxes   (a   “Tax   Audit”)   which,   by   application   of   similar

principles  to  any past,  present  or  future  period,  would  result  in  a  Tax  Deficiency for  such  period

and  no  Claim  has  ever  been  made  by  a  Governmental  Authority  in  a  jurisdiction  where  the

Company does not file Tax Returns that it is or may be subject to taxation by that jurisdiction;

(9)

There  are  no  pending  or,  to  the  Seller’s  Knowledge,  threatened,

Tax Audits of the Company;

(10)      To  Seller’s  Knowledge,  there  are  no  requests  for  rulings  in  respect

of any Tax pending between the Company and any Governmental Authority;

(11)      To   Seller’s   Knowledge,   the   Company   has   complied   with   all

applicable  Laws  in  all  material  respects  relating  to  the  withholding  and  payment  of  Taxes  and

has  timely  withheld  and  paid  to  the  proper  Governmental  Authorities  all  amounts  required  to

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have  been  withheld  and  paid  in  connection  with  amounts  paid  or  owing  to  any  employee,

independent contractor, creditor or shareholder;

(12)      To  Seller’s  Knowledge,  the  Company  has  disclosed  on  its  federal

income   Tax   Returns   all   positions   taken   therein   that   could   give   rise   to   a   substantial

understatement of federal income Tax within the meaning of Section 6662 of the Code;

(13)      To  Seller’s  Knowledge,  none  of  the  assets  of  the  Company  is

property that it is required to be  treated as being owned  by any other person pursuant to the “safe

harbor lease” provisions of former Section 168(f)(8) of the Code;

(14)      None  of  the  assets  of  the  Company  directly  or  indirectly  secures

any debt, the interest on which is tax-exempt under Section 103(a) of the Code;

(15)      None  of  the  assets  of  the  Company  is  “tax-exempt  use  property”

within the meaning of Section 168(h) of the Code;

(16)      The   Company   does   not   have,   and   has   not   had,   a   permanent

establishment  in  any  foreign  country,  as  defined  in  any  applicable  tax  treaty  or  convention

between the United States and such foreign country; and

(17)      Neither  the  Company  is  not  a  party  to  any  Tax  allocation  or  Tax

sharing agreement

(b)

Schedule  3.11  contains:  (1)   a   schedule  of  the   filing  dates  of  all  Tax

Returns  required  to  be  filed  by  the  Company;  (2)  a  description  of  all  past  Tax  Audits  involving

the  Company;   and   (3)  a   list  of  the   states,   territories  and  jurisdictions  (whether   foreign   or

domestic)   to  which   any  Tax   is  properly  payable   by  the   Company.  Except  as  set   forth  on

Schedule  3.11,  to  Seller’s  Knowledge,  the  Company  has  retained  all  supporting  and  backup

papers,   receipts,   spreadsheets   and   other   information   reasonably   necessary   for:   (A)   the

preparation  of all Tax  Returns  that have  not yet  been filed; and  (B)  the defense  of all  Tax  Audits

involving  taxable  periods  either  ending  on  or  during  the  six  years  prior  to  the  Closing  Date  or

from   which   there   are   unutilized   net   operating   loss,   capital   loss   or   investment   tax   credit

carryovers.

(c)

To  Seller’s  Knowledge,  the  Company  has  collected  and  remitted  to  the

appropriate  Governmental  Authority  all  sales  and  use  or  similar  Taxes  required  to  have  been

collected,  including  any  interest  and  any  penalty,  addition  to  tax  or  additional  amount  unpaid,

and  has  been  furnished  properly  completed  exemption  certificates  for  all  exempt  transactions.

To   Seller’s   Knowledge,   the   Company   has   collected   and/or   remitted   to   the   appropriate

Governmental  Authority  all  property  Taxes,  customs  duties,  fees,  and  assessments  which  are

other  than  in  the  nature  of  income  taxes  or  charge  of  any  kind  whatsoever  (including  Taxes

assessed  to  real  property  and  water  and  sewer  rents  relating  thereto),  including  any  interest  and

any penalty, addition to tax or additional amount unpaid.

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3.12     Vacation  Pay.  Schedule   3.12,  attached  hereto,   sets  forth   the   true  and

correct  amount  of  vacation,  holiday  and  sick  pay  unpaid  as  of  the  date  hereof  for  all  employees

of  the  Company  (i)  who  have  not  as  of  the  date  hereof  taken  vacation,  holiday  or  sick  time

earned  prior  to  the  date  hereof;  or  (ii)  who  have  not  earned  vacation,  holiday  or  sick  time  as  of

the  date  hereof  but  will  earn  vacation,  holiday  or  sick  time  for  any  period  or  partial  period  of

employment  prior  to  the  date  hereof  if  they  continue  as  employees  of  the  Company  to  the  date

when  such  vacation,  holiday  or  sick  time  will  accrue  to  them.  Except  as  set  forth  in  Schedule

3.12,  as  of  the  date  hereof,  the  Company  does  not  have  any  liability,  obligation  or  commitment

to  any  of  its  employees  for  vacation,  holiday  or  sick  pay  earned  or  accrued  up  to  and  including

the date hereof, whether or not vested.

3.13      Contracts and Commitments.

(a)

Significant  Contracts.  Except  for  the  Contracts  set  forth  in  Schedule  3.13

to  this  Agreement,  the  Company  and  the  Seller  are  not  a  party  to,  and  are  not  in  any  way

obligated  under, (i)  any agreement, contract  or commitment containing any covenant limiting the

freedom  of  the  Company  to  engage  in  any  line  of  business  or  compete  with  any  Person;  (ii)  any

contract,  agreement  or  commitment  with  the  Company’s  present  or  past  officers,  employees,

agents,  consultants  or  advisors  that  is  not  cancelable  by  the  Company  on  notice  of  not  longer

than  thirty  (30)  days  and  without  liability,  penalty  or  premium;  (iii)  any  contract,  agreement  or

commitment  relating  to  the  disposition  of  assets  of  the  Company,  other  than  in  the  ordinary

course  of  business;  (iv)  any  agreement  requiring  the  consent  of  any  other  person  to  the  transfer

or  the  sale  by  the  Company  of  all  or  substantially  all  of  the  Company’s  assets  or  to  a  change  in

control  with  respect  to  the  Company;  (v)  any  lease  of,  or  agreement  to  purchase  or  sell,  any

capital  asset;  (vi)  any  management,  consulting,  personal  service,  agency  or  other  contract  which

provides   for   rendition   of   services   or   for   any   commission,   bonus,   incentive,   consulting   or

additional  compensation;  (vii)  any  agreement  or  note  evidencing  any  Indebtedness;  (viii)  any

license,  other  than  licenses  for  off-the-shelf  software  applications;  (ix)  any  agreement  with  an

agent,  dealer,  distributor,  sales  representative  or  franchisee;  (x)  any  agreement  for  the  storage,

transportation,   treatment   or   disposal   of   any  Materials   of   Environmental   Concern;   (xi)   any

agreement   restricting   the   right   of   the   Company   to   use   or   disclose   any   information   in   its

possession;  (xii)  any  partnership,  joint  venture  or  similar  relationship;  (xiii)  any  open  purchase

order  by  the  Company  to  any  vendor,  or  from  any customer  of  the  Company,  which  involves  an

amount  in  excess  of  $25,000;  (xiv)  any  other  agreement  which  involves  an  amount  in  excess  of

$25,000, or is not  in the  ordinary course of business of the Company; or (xv) any agreement with

any third party for the manufacture of the Company’s products.

(b)

[Intentionally Omitted].

(c)

Consents;  Renewals;  Defaults.  The  Company  has  not  received  any  notice

or  other  written  information  indicating  (i)  that  any  of  the  Contracts  set  forth  in  the  attached

Schedule  3.13  will  not  be  renewed  upon  expiration  or  (ii)  that  with  respect  to  any  Contract  set

forth  in  the  attached  Schedule  3.13  requiring consent  as a  result  of the  transactions contemplated

by this Agreement, the party whose consent  is required will  not give that consent.  The Company

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is not  in  default  under  any of  the  Contracts,  and  there  has  not  occurred any event  which  with the

lapse  of time  or giving  of notice  or  both would  constitute  such a default by the  Company. To  the

Knowledge  of  the  Seller  the  Contracts  are  valid  and  binding  in  accordance  with  their  respective

terms and are  in full  force and effect without any default, waiver  or indulgence thereunder by the

Company, or, to the Knowledge of the Seller, by any other party thereto.

3.14     Intellectual   Property,   Copyrights,   Patents,   Trademarks   and   Trade      Names.

Schedule  3.14  sets  forth  a  true  and  correct  listing  of  all  intellectual  property,  patents,  trade

names,    trademarks,    service    marks,   common-law   trademarks,    copyrights    (registered    and

common-law), and domain names,  and all  registrations and  applications for any of  the  foregoing,

owned, possessed,  licensed  or used  by the Company or  otherwise used  in the Acquired  Business.

Except  as  set  forth  in  Schedule  3.14,  the  Company owns  the  entire  right,  title  and  interest  in  and

to  the  items  listed  on  Schedule  3.14,  and  such  items  are  not  subject  to  any  pending  or,  to  the

Knowledge  of  the  Seller,  threatened  litigation  or  other  adverse  claims.  To  the  Knowledge  of  the

Seller such  items  do not  violate  any Intellectual  Property Rights  of  any other  Person.  There  have

been no written claims or assertions by any other  Person  of  infringement of any of  such items by

the  Company.  None  of  the  items  listed  on  Schedule  3.14  is  invalid  or  unenforceable,  and  all

filings  required  to  keep  such  items  effective  and  enforceable  have  been  made  by  the  Company.

The  Company  has  not  infringed,  misappropriated  or  otherwise  conflicted  with,  and  the  operation

of  the  Acquired  Business  as  currently  conducted  will  not  infringe,  misappropriate  or  otherwise

conflict  with,  any  Intellectual  Property Rights  of  any  Person,  and  the  Company has  not  received

notice  of  any  claims  alleging  any  of  the  foregoing.  The  Company  owns  and  possesses,  or  has  a

valid  and  enforceable  right  to  use,  all  Intellectual  Property  Rights  used  in  the  operation  of  the

Acquired Business as presently conducted.

3.15     Environmental Matters.

Except as set forth on Schedule 3.15

(a)

The   Company    is    and    has    been    in    material    compliance    with   all

Environmental  Laws  and  has  not  received  any  communication  (written  or  oral),  whether  from  a

governmental  authority,  citizens  group,  employee  or  otherwise,  that  alleges  that  the  Company  is

not  in compliance with applicable Environmental Laws,  and  to the  Knowledge of the Seller there

are no present circumstances that may prevent or interfere with such compliance in the future.

(b)

There  is  no  Environmental  Claim  pending  or,  to  the  Knowledge  of  the

Seller,  threatened  against  the  Company,  or  against  any  person  or  entity  whose  liability  for  any

Environmental  Claim the  Company has  or  may have  retained  or  assumed  either  contractually or,

to the Knowledge of the Seller, by operation of law.

(c)   The   Company   has   not   caused   any   past   or   present   actions,   activities,

circumstances,   conditions,   events   or   incidents,   including,   without   limitation,   the   release,

emission,  discharge,  presence,  or  disposal  of  any Material  of  Environmental  Concern,  that  could

form  the  basis  of  any  Environmental  Claim  against  the  Company  or  any  person  or  entity whose

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liability  for  any  Environmental  Claim  the  Company  has  or  may have  retained  or  assumed  either

contractually or  ,  to  the  Knowledge  of the  Seller,  by operation  of Law.  To the  Knowledge  of the

Seller,  no  Person  has  caused  any  past  or  present  actions,  activities,  circumstances,  conditions,

events  or  incidents,  including,  without  limitation,  the  release,  emission,  discharge,  presence,  or

disposal   of   any   Material   of   Environmental   Concern,   that   could   form   the   basis   of   any

Environmental  Claim  against  the  Company  or  any  person  or  entity  whose  liability  for  any

Environmental  Claim the  Company has  or  may have  retained  or  assumed  either  contractually or,

to the Knowledge of the Seller, by operation of Law.

(d)

Without   in   any  way   limiting  the   generality  of   the   foregoing,   (i)   the

Company  has  not  stored,  disposed  or  arranged  for  the  disposal  of  Materials  of  Environmental

Concern  on  all  off  site  and  on  site  locations,  (ii)  to  the  Knowledge  of  the  Seller,  there  are  no

underground storage tanks located on property at any time owned or leased by the Company, (iii)

to  the  Knowledge  of  the  Seller,  there  is  no  asbestos  contained  in  or  forming  part  of  the  Leased

Real  Estate  or  any  building,  building  component,  structure  or  office  space  owned  or  leased  by

the Company,  and (iv)  to the  Knowledge  of  the  Seller,  no polychlorinated  biphenyls (PCB’s)  are

used or stored at the Leased Real Estate or any property owned, leased or used by the Company.

3.16      Computer  Systems.  To  the  Knowledge  of  Seller  and  other    than    the

normal   rotation   of   older   computer   hardware,   software   and   equipment   that   have   not   been

disposed  of,  all  of  the  computer  hardware  and  software  systems,  and  all  equipment  including

imbedded   microprocessors,   owned,   leased   or   used   by   the   Company   (including,   without

limitation,   those   related   to   equipment,   manufacturing   processes,   quality   control   activities,

accounting  and  bookkeeping  records  and  record  keeping  activities,  environmental,  HVAC  and

other  facility  controls,  and  security  and  communications  systems)  are  fully  operational  and  are

operating properly as designed.

3.17     Transactions  with  Affiliates.  Except  as  set  forth  in  Schedule  3.17  hereto,

since  December  31,  2013, the Company has  not,  directly or  indirectly,  purchased,  leased  from  or

otherwise  acquired  any  property  or  obtained  any  services  from,  or  sold,  leased  to  or  otherwise

disposed  of  any  property  or  furnished  any  services  to,  or  otherwise  dealt  with,  in  the  ordinary

course  of  business  or  otherwise,  any  Seller  or  any  other  Person  which,  directly  or  indirectly,