AMENDED AND RESTATED ASSET PURCHASE AGREEMENT

Exhibit 10.1

AMENDED AND RESTATED
ASSET PURCHASE AGREEMENT

BY AND AMONG

SUPERFLY ADVERTISING, INC., A DELAWARE CORPORATION F/K/A MORLEX, INC.,
AND ITS WHOLLY-OWNED SUBSIDIARY, SUPERFLY ADVERTISING, INC.,
AN INDIANA CORPORATION

AND

COMMERCE PLANET, INC., A UTAH CORPORATION,
LEGACY MEDIA LLC, A CALIFORNIA LIMITED LIABILITY COMPANY, AND
CONSUMER LOYALTY GROUP LLC, A CALIFORNIA LIMITED LIABILITY COMPANY

DATED AS OF DECEMBER 16, 2008

TABLE OF CONTENTS

Signatures
Exhibits
Schedules

LIST OF EXHIBITS

LIST OF SCHEDULES

AMENDED AND RESTATED ASSET PURCHASE AGREEMENT

THIS AMENDED AND RESTATED ASSET PURCHASE AGREEMENT (this “ Agreement ”), dated as of December 16, 2008, is made and entered into by and among Superfly Advertising, Inc., a Delaware corporation f/k/a Morlex, Inc. (the “ Superfly Parent ”), Superfly Advertising, Inc., an Indiana corporation, and a wholly-owned subsidiary of Superfly Parent (the “ Purchaser ”), Commerce Planet, Inc., a Utah corporation (the “ Parent ”), Legacy Media LLC, a California limited liability company and wholly-owned subsidiary of the Parent (“ Legacy ”), and Consumer Loyalty Group, LLC, a California limited liability company and wholly-owned subsidiary of the Parent (“ CLG ” and collectively with Legacy, the “ Sellers ”).  Legacy and CLG are sometimes individually referred to herein as “ Seller ” and collectively as the “ Sellers .”  Superfly Parent, the Purchaser, the Parent, Legacy and CLG are sometimes individually referred to herein as a “ Party ” and collectively as the “ Parties .”

RECITALS

A.        Legacy and CLG are in the business of internet marketing and advertising.

B.        On September 16, 2008, the Parties entered into an asset purchase agreement (the “ Prior Agreement ”) pursuant to which the Sellers proposed to sell to the Purchaser, and the Purchaser proposed to purchase from the Sellers, certain assets used or held for use by the Sellers in the conduct of the Business as a going concern, and the Purchaser proposed to assume certain of the liabilities and obligations of the Sellers, all as more fully set forth in the Prior Agreement and this Agreement (the “ Acquisition ”).

C.        The Parties desire to amend and restate in its entirety the Prior Agreement and enter into this Agreement all upon the terms and conditions hereinafter set forth.  Upon execution of this Agreement, the Parties agree that the Prior Agreement shall no longer be of any force or effect.

D.        As an inducement and condition to the willingness of Purchaser and Superfly Parent to enter into this Agreement, certain shareholders of Parent (each, a “ Voting Agreement Shareholder ” and collectively, the “ Voting Agreement Shareholders ”), representing in the aggregate approximately 35% of the issued and outstanding shares of common stock, par value $0.001 per share, of the Parent (the “ Parent Common Stock ”), have entered into a Voting Agreement, dated as of the date hereof, with Superfly Parent (the “ Voting Agreement ”), pursuant to which each Voting Agreement Shareholder has agreed, among other things, to vote such Voting Agreement Shareholder’s shares of Parent Common Stock in favor of approval of this Agreement, the Acquisition and the transactions contemplated hereby, upon the terms and subject to the conditions set forth in the Voting Agreement.  A form of the Voting Agreement is attached hereto as Exhibit A .

D.        The Parties desire to make certain representations, warranties and agreements in connection with the Acquisition.

NOW, THEREFORE, in consideration of the foregoing and the respective representations, warranties, covenants, agreements and conditions hereinafter set forth, and intending to be legally bound hereby, the Parties agree as follows:

ARTICLE I
DEFINITIONS

Section 1.1.        Definitions .

The following Terms, as used herein, have the following meanings:

“ Affiliate ” means, with respect to any Person, (i) a director or officer of such person, or a shareholder owning 5% or more of the outstanding voting securities of such person, (ii) a spouse, parent, sibling or descendant of such person (or spouse, parent, sibling or descendant of any director or executive officer of such Persons), and (iii) any other Person directly or indirectly controlling, controlled by, or under common control with such other Person.  For purposes of this definition, “control,” when used with respect to any specified Person, means the power to direct the management and policies of such Person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise; and the terms “controlling” and “controlled” have meanings correlative to the foregoing.

“ Business ” means the business of internet marketing and advertising conducted by the Sellers, but excluding e-commerce.

“ Business Day ” means any day except Saturday, Sunday or any day on which banks are generally not open for business in the City of New York.

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

“ Contract ” means any written or oral contract, loan or credit agreement, note, bond, mortgage, indenture, lease, sublease, understanding, purchase order or other agreement, instrument, concession, franchise or license.

“ EBITDA ” means for any given period, an amount equal to (a) the net income of the Business for that period; plus (b) the total of the interest, tax, depreciation and amortization expenses used in computing net income of the Business for that period as determined in accordance with GAAP.

“ ERISA ” means the Employee Retirement Income Security Act of 1974, as amended.

“ Exchange Act ” means the Securities Exchange Act of 1934, as amended.

“ FTC ” means the Federal Trade Commission.

“ GAAP ” means generally accepted accounting principles employed in the United States.

“ Governmental Entity ” means any federal, state or local or foreign government or any court, administrative or regulatory agency or commission or other governmental authority or agency, domestic or foreign.

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“ Hazardous Materials ” mean any waste, pollutant, contaminant, hazardous substance, toxic, ignitable, reactive or corrosive substance, hazardous waste, special waste, industrial substance, by-product, process intermediate product or waste, petroleum or petroleum-derived substance or waste, chemical liquids or solids, liquid or gaseous products or any constituent of any such substance or waste, the use, handling or disposal of which by the Parent or any Seller is in any way governed by or subject to any applicable Environmental Law.

“ Indebtedness ” means indebtedness for borrowed money, reimbursement obligations with respect to letters of credit and similar instruments, obligations incurred, issued or assumed as the deferred purchase price of property or services (other than accounts payable incurred in the ordinary course of business consistent with past practice), obligations under leases that are or should be capitalized under GAAP, obligations of others secured (or, for which the holder of such indebtedness has an existing right, contingent or otherwise, to be so secured) by any Liens on the Assets and obligations in respect of guarantees of any of the foregoing or other agreement to maintain any financial statement condition of another Person, in each case, whether or not matured, liquidated, fixed, or contingent, and without duplication.  The term “Indebtedness” shall mean the amount required to retire such Indebtedness on the date in question and includes all principal, interest, fees, expenses, prepayment penalties and other similar obligations owed in respect of any outstanding Indebtedness.

“ Intellectual Property Right ” means all Copyrights, Patents, Know-How, Trademarks and other intellectual or proprietary rights or property and the rights to obtain renewals, extensions, continuations or similar legal protections.  For purposes of this definition “Copyrights” shall mean registered or unregistered claims of copyright, assignments of copyright, design rights, rights to mask works and database rights, and registrations and applications for registration of any of the foregoing; “Know-How” shall mean methods, devices, technology, software, trade secrets, designs, drawings, know-how, show-how, technical and training manuals and documentation, contact information, book of business, franchises, customer lists, client lists, instructions, marketing materials, advertising records, research records, sales and promotional materials, files, correspondences, reports, records  and other proprietary information, including proprietary processes, procedure, designs and formulae, and invention disclosures and rights in inventions; “Patents” shall mean United States patents and United States patent applications, continuations, continuations-in-part, divisions, reissues, re-exam certificate, extensions, and foreign counterparts of such patents and related items; and “Trademarks” shall mean (i) United States registered trademarks and United States registered service marks, applications for registration of such trademarks and service marks, renewal registrations and applications for renewal registrations, extensions and foreign counterparts of such registered trademarks, registered service marks and related items; (ii) unregistered trademarks and service marks; (iii) corporate names, business names, logos, fictitious business names, and trade names, whether registered or unregistered; and (iv) internet domain names and associated addresses and URLs.

“ IRS ” means the Internal Revenue Service of the United States.

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“ Knowledge ” of any Person means (a) the actual knowledge of such Person or its officers and directors and (b) that knowledge which should have been acquired by such Person or its officers and directors after making such due inquiry and exercising such due diligence as a prudent businessperson would have made or exercised in the management of his or her business affairs, including due inquiry of those officers, directors and key employees of such Person who could reasonably be expected to have actual knowledge of the matters in question.

“ Law ” means any law (both common and statutory law and civil and criminal law), treaty, convention, rule, directive, legislation, ordinance, regulatory code (including, without limitation, statutory instruments, guidance notes, circulars, directives, decisions, rules and regulations) or similar provision having the force of law or an Order of any Governmental Entity or any self regulatory organization.

“ Liability ” means any actual or potential liability or obligation (including as related to Taxes), whether known or unknown, asserted or unasserted, absolute or contingent, accrued or unaccrued, liquidated or unliquidated and whether due or to become due, regardless of when asserted.

“ Lien ” means, with respect to any property or asset, any mortgage, lien, pledge, charge, security interest, or encumbrance of any kind in respect of such property or asset.  For the purposes of this Agreement, a Person shall be deemed to own subject to a Lien any property or asset which it has acquired or holds subject to the interest of a vendor or lessor under any conditional sale agreement, capital lease or other title retention agreement relating to such property or asset.

“ Material Adverse Effect ” means any state of facts, change, event, effect or occurrence that, individually or in the aggregate, is or could be reasonably likely to be materially adverse to the condition (financial or otherwise), results of operations, prospects, properties, assets or liabilities (including, without limitation, contingent liabilities) of the Business, the Assets or the Assumed Liabilities taken as a whole.  A Material Adverse Effect shall also include any state of facts, change, event or occurrence that shall have occurred or been threatened that (when taken together with all other adverse state of facts, changes, events, effects or occurrences that have occurred or been threatened) is or could be reasonably likely to prevent or materially delay the performance by a Party of any of their respective obligations under this Agreement or the consummation of the transactions contemplated hereby; provided that the term “Material Adverse Effect” shall not include any change arising from the following events, but only to the extent not disproportionately affecting the Business (a) changes in the United States or foreign economies or securities markets in general, any state, province or locality in which any Party (or any subsidiaries of such Party) conducts business or a Party’s industry in general, (b) changes in any law, regulation, rule, ordinance, policy, mandate, guideline or other requirement of any governmental authority (including changes in interpretations of any of the foregoing by courts or government entities, agencies or authorities), (c) any adverse change in or effect on the business of a Party that is cured in all material respects before the Closing Date, (d) changes in GAAP, or (e) acts of war, major hostilities or terrorism.

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“ Orders ” means judgments, writs, decrees, compliance agreements, injunctions or judicial or administrative orders and legally binding determinations of any Governmental Entity or arbitrator.

“ Parent Articles ” shall mean the articles of incorporation of Parent, as amended, as on file with the Division of Corporations and Commercial Code of the State of Utah and in effect as of the date of this Agreement.

“ Parent Bylaws ” shall mean the bylaws of Parent as amended to date.

“ Permits ” means all permits, licenses, authorizations, filings or registrations, franchises, approvals, certificates, exemptions, variances and similar rights obtained, or required to be obtained, from Governmental Entities.

“ Permitted Liens ” means (a) Liens for Taxes not yet due and payable, (b) statutory Liens of landlords and Liens of carriers, warehousemen, mechanics, materialmen and repairmen incurred in the ordinary course of business consistent with past practice and not yet delinquent and (c) zoning, building, or other restrictions, variances, covenants, rights of way, encumbrances, easements and other minor irregularities in title, none of which, individually or in the aggregate, (i) interfere in any material respect with the present use of or occupancy of such parcel by the Parent or any Seller, (ii) have more than an immaterial effect on the value thereof or their use or (iii) would impair the ability of such parcel to be sold for their present use.

“ Person ” means an individual, corporation, partnership, limited liability company, association, trust or other entity or organization, including a government or political subdivision or an agency or instrumentality thereof.

“ Pre-Closing Tax Period ” means any Tax period ending on or before the Closing Date.

“ Proceedings ” means actions, suits, claims, reviews, and investigations and legal, administrative or arbitration proceedings.

“ Securities Act ” means the Securities Act of 1933, as amended.

“ Seller Employee Benefit Plan ” means each plan, fund, program, agreement or arrangement (a) with respect to which either Seller or Parent has any liability, whether actual or contingent, direct or indirect covering the employees of the Business and (b) which provide employee benefits or for the remuneration, direct or indirect, of employees, former employees, directors, officers, consultants, independent contractors, contingent workers or leased employees of the Business that together with the Parent or any Seller would be a single employer within the meaning of Section 414 of the Code (whether written or oral), including, without limitation, each “welfare” plan (within the meaning of Section 3(1) of ERISA) and each “pension” plan (within the meaning of Section 3(2) of ERISA).

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“ Taxes ” means all taxes, assessments, charges, duties, fees, levies or other governmental charges (including interest, penalties or additions associated therewith), including income, franchise, capital stock, real property, personal property, tangible, withholding, employment, payroll, social security, social contribution, unemployment compensation, disability, transfer, sales, use, excise, gross receipts, value-added and all other taxes of any kind imposed by any Governmental Entity, whether disputed or not, and any charges, interest or penalties imposed by any Governmental Entity.

“ Tax Return ” shall mean any report, return, declaration or other information required to be supplied to a Governmental Entity in connection with Taxes, including estimated returns and reports of every kind with respect to Taxes.

“ Utah Act ” shall mean the Utah Revised Business Corporation Act.

Section 1.2.        Other Definitions .

Each of the following terms is defined in the Section set forth opposite such term:

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ARTICLE II
PURCHASE AND SALE

Section 2.1.        Agreement to Purchase and Sell .

Subject to the terms and conditions of this Agreement, at the Closing and except for the Excluded Assets, each Seller shall grant, sell, assign, transfer and deliver to the Purchaser, and the Purchaser shall purchase and acquire from each Seller, all right, title and interest of the Sellers in, to and under the assets, properties and business, of every kind and description, wherever located, real, personal or mixed, tangible or intangible, owned or held for use or used in the conduct of the Business by the Sellers (which assets, properties and rights are collectively referred to in this Agreement as the “ Assets ”), free and clear of all Liens, other than Permitted Liens, and the Purchaser will assume the Assumed Liabilities (as hereinafter defined).

Section 2.2.        Assets .

Except as otherwise expressly set forth in Section 2.3, the Assets shall include, without limitation, the following assets, properties and rights of each Seller as of the close of business on the Closing Date:

(a)                     all leases of, easements upon or options for easements upon, and other interests in, real property solely or primarily used in connection with the Business, as set forth on Schedule 2.2(a) ;

(b)                     all furniture, fixtures, equipment, inventory, computer hardware, and all other tangible assets and personal property, which is used or held for use in the operation of the Business, including as set forth on Schedule 2.2(b) ;

(c)                     the Contracts and Contract rights of the Sellers with respect to the Business set forth on Schedule 2.2(c) (collectively, the “ Assumed Contracts ”);

(d)                     all deposits, advances, pre-paid expenses and credits relating to the Business;

(e)                     all Intellectual  Property Rights relating to the Business, including without limitation the names “Legacy Media,” “Consumer Loyalty Group” and any similar name or a name containing similar terms;

(f)                     all goodwill and going concern value of the Business;

(g)                     except with respect to defenses available in respect of any Excluded Liabilities, all rights to causes of action, lawsuits, judgments, claims and demands of any nature available to or being pursued with respect to the Business, whether arising by way of counterclaim or otherwise;

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(h)                     all rights in and under all express or implied guarantees, warranties, representations, covenants, indemnities and similar rights in favor of the Sellers or otherwise relating to the Business;

(i)                     all Permits, certifications and licenses, authorizations, accreditations, qualifications, product or service registrations or similar rights to the extent that they are assignable, including as set forth on Schedule 2.2(i) ;

(j)                     all accounts receivable related to the Business;

(k)                     all information, files, correspondence, records (other than corporate records), data, plans, reports, contracts and recorded Knowledge, including client and employee files, customer, supplier, price and mailing lists, manuals, schematics, formulation, and all accounting or other books and records of the Business in whatever media retained or stored, including, without limitation, computer programs and disks; and

(l)                     the Insurance policies set forth on Schedule 2.2(l) (“ Transferred Insurance Policies ”);

(m)                     all cash and cash equivalents;

(n)                     all of the issued and outstanding shares of capital stock or equity interests, as applicable, of Proton Laboratories, Inc., a Washington corporation, owned by Legacy;

(o)                     all rights to pursue Proceedings against merchant account holders and to receive any and all proceeds from any such Proceeding; and

(p)                     all other tangible and intangible assets of any kind or description, wherever located, that are carried on the books of the Business or which are owned by the Sellers or used or held for use in the operations of the Business or shown on the Unaudited Balance Sheet that have not been disposed of by the Business since the Unaudited Balance Sheet Date in the ordinary course of business in accordance with past practices.

Section 2.3.        Excluded Assets .

Notwithstanding anything to the contrary set forth in this Agreement, the Assets will not include the following assets, properties and rights of the Parent or any Seller (collectively, the “ Excluded Assets ”):

(a)                     all rights of the Sellers under any and all Contracts that are not Assumed Contracts;

(b)                     any Permit or similar right that by its terms is not transferable to the Purchaser, including those set forth on Schedule 2.3 ;

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(c)                     all refunds or claims for refunds due from federal, state and local Tax authorities with respect to federal, state and local income Taxes paid by the Sellers for periods ending on or prior to the Closing Date;

(d)                     any assets of any Seller Employee Benefit Plan;

(e)                     any of the rights of the Sellers under this Agreement;

(f)                     the charter documents of the Sellers, minute book, stock ledger, Tax Returns, and other constituent records relating to the corporate organization of the Sellers;

(g)                     all of the issued and outstanding shares of capital stock or equity interests, as applicable, of Channel Marketing Limited, a private limited company incorporated under English law (“ Channel Marketing ”), owned by CLG;

(h)                     all other tangible and intangible assets of any kind or description, wherever located, owned by and used solely in connection with the business of Myflick.com; and

   (i)  assets of the Parent and Sellers not related to the Business.

Section 2.4.        Assumed Liabilities .

(a)                     Anything contained herein to the contrary notwithstanding, except for the Assumed Liabilities described in Section 2.4(b), the Purchaser shall not and the Purchaser does not assume any liabilities or obligations (fixed or contingent, known or unknown, matured or unmatured) of the Sellers whether or not arising out of or relating to the Assets or the Business or any other business of the Sellers or Parent, all of which liabilities and obligations shall, at and after the Closing, remain the exclusive responsibility of the Sellers (as applicable).

(b)                     Effective as of the close of business on the Closing Date, the Purchaser will assume and agree to pay, discharge or perform, as appropriate, only the following Liabilities of Sellers with respect to the Business: (i) the obligations of the Sellers under the Assumed Contracts and Permits included in the Assets that relate to the operations of the Business subsequent to the Closing Date, except to the extent relating to breach or default under any such Assumed Contract or violation under such Permit by any Seller prior to the Closing Date; (ii) the accounts payable of the Sellers arising in the ordinary course of business of the Sellers, consistent with past practices, that are not related to a breach, default or violation by any Seller, as set forth in Schedule 2.4 ; (iii) the Liabilities of the Parent and any Seller in connection with the Business as set forth in Schedule 2.4 (the “ Associated Liabilities ”); and (iv) all Liabilities and obligations arising out of the operation of the Business by the Purchaser after the Closing Date, except to the extent specifically included in Excluded Liabilities (collectively, the “ Assumed Liabilities ”).

Section 2.5.        Excluded Liabilities .

Specifically, and without in any way limiting the generality of Section 2.4(a), the Assumed Liabilities will not include, and in no event will the Purchaser assume, agree to pay, discharge or satisfy, or otherwise have any responsibility for, any Liability or obligation (together with all other Liabilities of the Sellers or Parent that are not Assumed Liabilities, the “ Excluded Liabilities ”):

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(a)                     owed to any Seller or any Affiliate of any Seller which was incurred prior to the Closing Date;

(b)                     for any Taxes of any Seller or any Affiliate of any Seller with respect to any period or portion thereof and any Taxes attributable to the Assets relating to any period or portion thereof ending on or prior to the Closing Date ( provided , that with respect to any Tax that is imposed on a periodic basis and is payable for a taxable period that begins before and ends after the Closing Date, the portion of such Taxes that is payable for the portion of such taxable period ending on such Closing Date shall be the amount of such Tax for the entire period (or, in the case of such Taxes determined on an arrears basis, the amount of such Tax for the preceding period) multiplied by a fraction, the numerator of which is the number of days in the portion of such taxable period ending on such Closing Date and the denominator of which is the number of days in the entire taxable period);

(c)                     for any Indebtedness of any Seller or Parent, or any Indebtedness otherwise relating to the Business which was incurred prior to the Closing Date;

(d)                     relating to, resulting from or arising out of (i) claims made in pending or future suits, actions, investigations or other legal, governmental or administrative proceedings relating to events which have occurred, conditions arising, facts and circumstances existing, or the operation of the Business, prior to the Closing Date, or (ii) claims based on violations of Law, breach of contract, employment practices, intellectual property matters, product warranty, product liability, or environmental, health and safety matters or any other actual or alleged failure of the Parent or any Seller to perform any obligation, in each case arising out of or relating to events which have occurred, conditions arising, facts and circumstances existing, goods delivered or services performed, or the operation of the Business, prior to the Closing, including without limitation, any claims set forth in Schedules 4.10(a) or 4.11 ;

(e)                     pertaining to any Excluded Asset;

(f)                     for any Liability or reimbursement obligation to any third party payor arising out of or relating to the operation of the Business for periods prior to the Closing Date, other than accounts payable included in the Assumed Liabilities;

(g)                     relating to, resulting from or arising out of any former operations of any Seller that have been discontinued or disposed of prior to the Closing Date;

(h)                     under or relating to any Seller Employee Benefit Plan, whether or not such Liability or obligation arises prior to or after the Closing Date;

(i)                     any Liability for any employees of the Business with respect to the periods prior to the Closing Date, including any wages, salaries or otherwise, or any Liability for any severance or similar payments for any employees of the Business;

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(j)                     of the Parent or any Seller arising or incurred in connection with the negotiation, preparation and execution of this Agreement and the transactions contemplated hereby and any fees and expenses of counsel, accountants, brokers, financial advisors or other experts of the Parent or any Seller;

(k)                     any Liability related to any Proceeding, including without limitation, any Proceedings initiated by the FTC, or by a third party in connection with the activities subject to any such FTC Proceeding;

(l)                     all Liabilities of Parent or any Seller to Issa Gharibeh whether or not reflected in the Financial Statements; or

(m)                     relating to Channel Marketing.

Such Excluded Liabilities shall include all claims, actions, litigations and proceedings relating to any or all of the foregoing and all costs and expenses in connection therewith.

ARTICLE III
PURCHASE PRICE; ALLOCATIONS

Section 3.1.        Purchase Price .

(a)                     The purchase price for the Assets (the “ Purchase Price ”) shall be as follows: (i) the payment to the Parent of cash in the amount of $825,000 (the “ Cash ”), payable as set forth in Section 3.1(b) below; and (ii) the issuance to the Parent of 4,500,000 shares (the “ Shares ”) of common stock, par value $0.001, of the Purchaser (“ Purchaser Common Stock ”), which the Parties agree for purposes of the Agreement shall be valued at $0.75 per share issuable as set forth in Section 3.1(c) below.  In addition to the foregoing amount, as consideration for the grant, sale, assignment, transfer and delivery of the Assets, the Purchaser shall assume and discharge the Assumed Liabilities as such Assumed Liabilities mature according to their terms.

(b)       The Cash portion of the Purchase Price shall be payable as follows: (i) $125,000 (the “ Deposit ”) was paid upon the execution of the Prior Agreement by the Parties, (ii) $200,000 shall be payable at the Closing by the forgiveness of all indebtedness of the Parent evidenced by the Loan advanced to the Parent by or on behalf of Purchaser set forth in Article VI of this Agreement; (iii) $300,000 less the amount of interest accrued on the Loan as of the Closing Date (the “ Closing Payment ”) shall be payable at the Closing by check or the wire transfer of immediately available U.S. funds to such bank account as shall be designated in the Escrow Agreement by and between the Parent and Hodgson Russ LLP, as escrow agent (the “ Escrow Agent ”), substantially in the form set forth in Exhibit H (the “ Escrow Agreement ”); and (iv) $200,000 shall be payable in equal monthly installments (each, an “ Installment Payment ” and collectively, the “ Installment Payments ”) for 6 months commencing on the last day of the month following the Closing.

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(c)       The Shares shall be issuable upon the Closing.  The Shares will be restricted with appropriate legends and stop transfer orders until such time as the Shares are eligible to be resold pursuant to an effective registration statement filed by Superfly Parent in accordance with the terms of the Registration Rights Agreement, or under the provisions of Rule 144, promulgated under the Securities Act, as amended; provided however , that 2,250,000 of the Shares will not be resold, transferred or otherwise distributed by the Parent until the FTC Proceedings are settled as contemplated by the provisions of Section 7.18; provided, however, that if the FTC Proceedings are not so settled on or before six (6) months from the Closing Date, Superfly Parent may demand the return of all or a portion of such 2,250,000 Shares as a non-exclusive remedy for indemnification purposes as contemplated by the provisions of Section 12.1(h).  At the Closing, Superfly Parent shall deliver or cause to be delivered to Superfly Parent’s transfer agent the instruction letter, instructing the transfer agent to issue the Shares to the Parent effective as of the Closing Date, and shall cause the transfer agent to have the Shares issued on the Closing Date.

Section 3.2.        Allocation of Purchase Price .

(a)       Within sixty (60) days following the Closing, the Purchaser shall prepare and deliver to the Parent, an allocation of the Purchase Price (and all other capitalized costs) among the Assets and the Assumed Liabilities in accordance with Code Section 1060 and the U.S. Treasury regulations thereunder (and any similar provision of state, local or foreign law, as appropriate), which allocation shall be conclusive and binding on the parties hereto.  

(b)                     The parties shall report, act and file Tax Returns in a manner consistent with the allocations set forth in clause (a), except as required by applicable Law.  The Sellers and Parent shall timely and properly prepare, execute, file and deliver all such documents, forms and other information as the Purchaser may reasonably request to prepare such allocations.

Section 3.3.        Allocation of Certain Items .

With respect to certain expenses incurred with respect to the Assets in the operation of the Business, the following allocations will be made between the Purchaser and the Sellers:

(a)                      Taxes .  Ad valorem property Taxes (or any other Tax that is imposed on a periodic basis) will be apportioned at the Closing based upon the number of days in the taxable period before and after the Closing Date and the amounts set forth in the current Tax bills.

(b)                      Utilities .  Utilities, water and sewer charges will be apportioned based upon the number of Business Days occurring before and after the Closing Date during the billing period for each such charge.

Appropriate cash payments by the Purchaser, the Parent or the Sellers, as the case may require, shall be made hereunder from time to time as soon as practicable after the facts giving rise to the obligation for such payments are known in the amounts necessary to give effect to the allocations provided for in this Section 3.3.

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ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE PARENT AND SELLERS

The Parent and each of the Sellers jointly and severally hereby represent and warrant to the Purchaser as follows:  

Section 4.1.        Organization .

The Parent is a corporation duly formed and validly existing under the laws of Utah and has all requisite power and authority to own, lease and operate its properties and to carry on its business as now being conducted.  Each of Legacy and CLG is a limited liability company duly formed and validly existing under the laws of California, and has all requisite power and authority to own, lease and operate its properties and to carry on its business as now being conducted.  The Parent has heretofore made available to the Purchaser true, correct and complete copies of the charter documents of the Parent and each Seller as currently in effect and the company record books of Parent and each Seller with respect to actions taken by Parent and each Seller’s board of directors or applicable governing body, as applicable.   Schedule 4.1 contains a true and correct list of the jurisdictions in which Parent and each Seller is qualified or registered to do business, or is required by law to be so qualified.

Section 4.2.        Authorization; Enforceability; Ownership .

(a)                      Authorization; Enforceability . The Parent and each Seller has full power and authority to execute and deliver this Agreement and any other certificate, agreement, document or other instrument to be executed and delivered by it in connection with the transactions contemplated by this Agreement (collectively, the “ Ancillary Documents ”) and to perform its respective obligations under this Agreement and the Ancillary Documents to which it is a party and to consummate the transactions contemplated hereby and thereby.  The execution and delivery of this Agreement and the applicable Ancillary Documents by Parent and each Seller and the performance by Parent and each Seller of its obligations hereunder and thereunder and the consummation of the transactions provided for herein and therein have been duly and validly authorized by all necessary corporate member or manager action, as applicable, on the part of Parent and each Seller; provided that, the approval of a requisite vote or consent of shareholders of the Parent is required in connection with this Agreement and the transactions contemplated hereby.  This Agreement has been, and the Ancillary Documents will be as of the Closing Date, duly executed and delivered by Parent and the Sellers and do or will, as the case may be, constitute the valid and binding agreements of Parent and the Sellers, enforceable against Parent and each Seller in accordance with their respective terms.

(b)                      Ownership .  Parent owns 100% of the issued and outstanding equity interests in each Seller.  CLG owns 100% of the issued and outstanding shares of capital stock or equity interests, as applicable, of Channel Marketing.  Channel Marketing is dormant, and does not own or possess any assets of the Business.  CLG has no other subsidiaries.  Legacy has no subsidiaries.

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Section 4.3.        Absence of Restrictions and Conflicts .

The execution, delivery and performance of this Agreement and the Ancillary Documents to which it is a party, the consummation of the transactions contemplated by this Agreement and the Ancillary Documents and the fulfillment of and compliance with the terms and conditions of this Agreement and the Ancillary Documents to which it is a party do not or will not, as the case may be, with the passing of time or the giving of notice or both, violate or conflict with, constitute a breach of or default under, result in the loss of any benefit under, permit the acceleration of any obligation under or create in the Parent or any Seller the right to terminate, modify or cancel, or otherwise require any action, consent, approval, order, authorization, registration, declaration or filing with respect to (a) any term or provision of the charter documents of the Parent or any Seller, (b) except as indicated on Schedule 4.12(b) , any Assumed Contract or any other material Contract, Permit or other instrument applicable the Parent, any Seller or the Business, (c) any judgment, decree or order of any court or Governmental Entity or agency to which the Parent or any Seller is a party or by which the Business or any of the Assets are bound or (d) except as set forth on Schedule 4.3 , any Law which is material to the Parent or any Seller or the Business.

Section 4.4.        Real Property .

(a)                     Neither the Parent nor any Seller owns any real property that is used or held for use in connection with the Business.   Schedule 4.4 sets forth a complete and accurate list of all leases of real property to which any Seller or, with respect to the Business, Parent or any Affiliate of Parent has a continuing financial or other obligation (together with all fixtures and improvements thereon, the “ Leased Real Property ”).  Each Seller or Parent, as applicable, has a valid leasehold interest in such Leased Real Property, free and clear of any Liens.  The leases of the Leased Real Property are in full force and effect. All leases of Leased Real Property are in good standing and are valid, binding and enforceable in accordance with their respective terms and there does not exist under any such lease any default or any event which with notice or lapse of time or both would constitute a default.

(b)                     The improvements on the Leased Real Property are in good operating condition and in a state of good maintenance and repair, ordinary wear and tear excepted, are adequate and suitable for the purposes for which they are presently being used.  There are no condemnation, appropriation or similar proceedings pending or threatened against any of the Leased Real Property or the improvements thereon.

Section 4.5.        Title to Assets; Related Matters .

The Assets constitute all of the assets necessary and sufficient to conduct the operations of the Business in accordance with Parent’s and each Sellers’ past practices and as presently planned to be conducted by the Purchaser, except as specifically set forth in the definition of Excluded Assets.  Except as set forth in Schedule 4.5 , the Sellers have (and will convey to the Purchaser at the Closing) good and marketable title to the Assets, free and clear of all Liens other than Permitted Encumbrances.  All plants, buildings, structures, equipment and other items of tangible personal property and assets included in the Assets: (a) are in good operating condition and in a state of good maintenance and repair, ordinary wear and tear excepted, consistent with standards generally followed in the industry; (b) are usable in the regular and ordinary course of business; and (c) conform in all material respects to all applicable laws, ordinances, codes, rules and regulations applicable thereto, and the Parent and Sellers have no Knowledge of any material defects or problems with any of the Assets.  The Sellers own, lease or license all of the Assets and neither Parent nor any Seller or Affiliate of Parent other than the Sellers has any rights with respect to the Assets.  No Person other than either Seller owns any equipment or other tangible personal property or assets either which are necessary to the operation of, or have been used or held for use in the operation of, the Business, except for the leased items that are subject to personal property leases.  Since December 31, 2007 (the “ Unaudited Balance Sheet Date ”), neither Seller has sold, transferred or disposed of any assets.   Schedule 4.5 sets forth a true, correct and complete list and general description of each material item of tangible personal property used or held for use in connection with the Business by the Sellers, the Parent or any Affiliate of Parent. There are no developments affecting any of the Assets pending or threatened, which might materially detract from the value, materially interfere with any present or intended use or materially adversely affect the marketability of such Assets.

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Section 4.6.        Financial Statements .

(a)                      Schedule 4.6 contains true, correct and complete copies of (i) the unaudited balance sheets of the Sellers as of December 31 for each of the years ended December 31, 2005, 2006 and 2007 (such 2007 balance sheet, the “ Unaudited Balance Sheet ”), and the related statements of income and cash flows for the years then ended (the “ Yearly Financial Statements ”), and (ii) the unaudited interim balance sheet of the Sellers for the six-month period ended August 20, 2008 (the “ Interim Balance Sheet ” and, collectively with the Yearly Financial Statements, the “ Unaudited Financial Statements ”).  

(b)                     Prior to the Closing Date, the Parent and Sellers shall deliver to Purchaser and Superfly Parent, pursuant to Section 7.16(a), true, correct and complete copies of the audited balance sheets of the Sellers as of December 31 for each of the years ended December 31, 2005, 2006 and 2007, and the related statements of income and cash flows for the years then ended (the “ Audited Financial Statements ” and collectively with the Unaudited Financial Statements, the “ Financial Statements ”).

(c)                     The Financial Statements have been, or in the case of the Audited Financial Statements will be, prepared in accordance with GAAP (except with respect to the Interim Balance Sheet, for the absence of notes thereto and year end audit adjustments which shall not be material), are, or in the case of the Audited Financial Statements will be, true, correct and complete and present fairly in all material respects the consolidated financial position of the Business, Assets and the Assumed Liabilities as of the dates thereof, and the related consolidated results of its operations and changes in cash flows for the periods then ended.  The Financial Statements are, or in the case of the Audited Financial Statements will be, based on the books and records of the Parent and Sellers which have been kept, and such Financial Statements have been, or in the case of the Audited Financial Statements will be, prepared, in accordance with GAAP applied on a consistent basis.  Since the Unaudited Balance Sheet Date, there has been no change in any of the accounting (and Tax accounting) policies, practices or procedures of the Parent or either Seller.

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Section 4.7.        Accounts Receivable; Indebtedness .

(a)       All accounts receivable reflected on the Unaudited Balance Sheet arose from bona fide sales transactions in the ordinary course of business of the applicable Seller, are reflected therein at values determined in accordance with GAAP, reflect normal credit and payment terms consistent with the past practices of the Parent and Sellers, are collectible in accordance with their payment terms or are fully reserved against in the Unaudited Balance Sheet, and none of such accounts receivable reflect or will reflect consignment sales or sales on approval.  Except charge backs and penalties that occur in the ordinary course of the Business consistent with past practice and none of which are material individually or in the aggregate, neither the Parent nor any Seller has received notice of any counterclaims or set-offs against such accounts receivable for which allowances have not been established in accordance with GAAP.  

(b)       All obligations of the Parent or Sellers constituting Indebtedness relating to the Business are listed on Schedule 4.7 or are otherwise listed in the Financial Statements.  

Section 4.8.        No Undisclosed Liabilities .

(a)        The Sellers have no Liabilities, except for (i) the Liabilities set forth on Schedule 4.8 ; (ii) Liabilities listed on the Financial Statements; (iii) Liabilities that have arisen since the date of the Financial Statements in the ordinary course of business (provided that there is no such Liability that is material that relates to breach of Contract, breach of warranty, tort, infringement, violation of Law, Order or Permit, or any Proceeding; (iv) Liabilities under or arising out of the performance of Contracts disclosed on Schedule 4.12(a) , or under or arising out of the performance of Contracts entered into after the date of this Agreement in accordance with the terms and conditions hereof, and (v) Liabilities disclosed in this Agreement or any Schedule to this Agreement.  Except as set forth on Schedule 4.8 , no Seller has, either expressly or by operation of Law, assumed or undertaken any Liability of any other Person.

Section 4.9.        Absence of Certain Changes .

Since the Unaudited Balance Sheet Date and except as set forth in Schedule 4.9 , there has not been (i) any event, occurrence, development or state of circumstances or facts which, individually or in the aggregate, has had or could reasonably be expected to have a Material Adverse Effect on Parent, any Seller, the Business, Assets or the Assumed Liabilities, (ii) any damage, destruction, loss or casualty to property or assets of the Business or included in the Assets, whether or not covered by insurance, (iii) any material change in the value or condition of the Business from the value or condition reflected in the Financial Statements; (iv) any action or event which, if occurring after the date of this Agreement, would violate Section 7.1 hereof; or (v) any Contract for Parent or any Seller to take any of the actions specified in this Section 4.9.

Section 4.10.       Legal Proceedings .

(a)        Except as set forth in Schedule 4.10(a) , there are no Proceedings (or any basis therefor) pending, threatened against, relating to or involving Parent, any Seller, the Business, the Assets or the Assumed Liabilities by any person or before any Governmental Entity.  Parent and Sellers have delivered or made available to the Purchaser true, correct and complete copies of all material documents and material correspondence relating to such matters referred to in Schedule 4.10(a) .

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(b)        Except as set forth in Schedule 4.10(b) , there are no Proceedings that (i) resulted in any criminal sanctions or (ii) within the last three (3) years, resulted in any payments, in each case by or against Parent, any Seller or any of their members, managers, employees, directors or officers in their capacity as members, managers, employees, directors or officers (whether as a result of a judgment, civil fine, settlement or otherwise) with respect to the Business, the Assets or Assumed Liabilities.

Section 4.11.       Compliance with Law .

Each Seller is (and has been at all times during the past five (5) years) in compliance in all material respects with all Laws applicable to the Business, the Assets or the Assumed Liabilities.  Except as set forth in Schedule 4.11 , with respect to the Business, the Assets or the Assumed Liabilities, (i) neither the Parent nor any Seller has been charged with, received written notice with respect to or been under investigation with respect to, a violation of any applicable Law, (ii) no Seller is a party to or bound by any Order of any Governmental Entity, and (iii) the Parent or each Seller has filed all reports required to be filed with any Governmental Entity with respect to the Business, the Assets or Assumed Liabilities on or before the date hereof and all such reports are accurate and complete in all material respects and in material compliance with all applicable Laws.  Each Seller has all Permits required or desirable in connection with the conduct of the Business, all such Permits are in full force and effect, and all such Permits are listed on Schedule 4.11 .

Section 4.12.       Seller Contracts .

(a)    Schedule 4.12(a) sets forth a true, correct and complete list of the following Contracts related to the Business, the Assets or the Assumed Liabilities:

(i)       all leases relating to the Leased Real Property or other leases or licenses involving any properties or assets (whether real, personal or mixed, tangible or intangible) involving an annual commitment or payment of more than $10,000 individually;

(ii)      all Contracts or agreements which limit or restrict a Seller or any members, managers, officers or key employees of the Parent or any Seller from engaging in any business in any jurisdiction;

(iii)     all franchising and licensing agreements;

(iv)      any Contract or agreement relating to the Intellectual Property;

(v)        any Contract or agreement with or for the benefit of an member, manager, employee, officer or director of the Parent or any Seller including any employment agreement;

(vi)      any Contract or agreement for capital expenditures or the acquisition or construction of fixed assets;

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(vii)     any Contract that provides for an increased payment or benefit, or accelerated vesting, upon the execution of this Agreement or in connection with the transactions contemplated hereby;

(viii)    any Contract or agreement granting any Person a Lien on all or any part of any of the Assets;

(ix)      any Contract or agreement for the cleanup, abatement or other actions in connection with any Hazardous Materials, the remediation of any existing environmental condition or relating to the performance of any environmental audit or study;

(x)       any Contract or agreement granting to any Person an option or a first refusal, first-offer or similar preferential right to purchase or acquire any assets;

(xi)      any Contract or agreement with any supplier, agent, distributor or representative that is not terminable without penalty on thirty (30) calendar days’ or less notice;

(xii)     any Contract or agreement for the granting or receiving of a license or sublicense or under which any Person is obligated to pay or have the right to receive a royalty, license fee or similar payment;

(xiii)    any Contract providing for the indemnification or holding harmless of any member, manager, officer, director, employee or other Person;

(xiv)     any joint venture or partnership Contract;

(xv)      any customer Contract for the provision of goods or services by the Business, including all outstanding orders or purchase orders;

(xvi)     any outstanding power of attorney empowering any Person to act on behalf of a Seller; and

(xvii)    all existing Contracts and commitments (other than those described in subparagraphs (i) through (xvi) of this Section 4.12(a)) that are material to the Business or entered into outside the ordinary course of business of the Business.

True, correct and complete copies of all Assumed Contracts have been made available to the Purchaser.

(b)                     The Assumed Contracts are legal, valid, binding and enforceable in accordance with their respective terms with respect to the Parent and the applicable Seller and with respect to each other party to such Assumed Contracts.  There are no existing defaults or breaches of the Parent or any Seller under any Assumed Contract (or events or conditions which, with notice or lapse of time or both would constitute a default or breach) and, to the Knowledge of Parent or any Seller, there are no such defaults (or events or conditions which, with notice or lapse of time or both, would constitute a default or breach) with respect to any third party to any Assumed Contract.  Neither the Parent nor any Seller has any Knowledge of any pending or threatened bankruptcy, insolvency or similar proceeding with respect to any party to such agreements.  Neither the Parent nor any Seller is participating in any discussions or negotiations regarding modification of or amendment to any Assumed Contract or entry in any new material contract applicable to the Business, Assets or the Assumed Liabilities.   Schedule 4.12(b) identifies each Assumed Contract that requires the consent of or notice to the other party thereto to avoid any breach, default or violation of such contract, agreement or other instrument in connection with the transactions contemplated hereby, including the assignment of such Assumed Contract to the Purchaser.

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(c)                      Schedule 4.12(c) sets forth a true, correct and complete list of the Assumed Contracts that include a commitment or obligation on the part of any Seller, or the Parent on behalf of any Seller, in an amount that exceeds five percent (5%) of revenue for the Business during the past twelve (12) months (each a “ Material Contract ” and collectively, the “ Material Contracts ”), and identifies each Material Contract that requires the consent of or notice to the other party thereto to avoid any breach, default or violation of such contract, agreement or other instrument in connection with the transactions contemplated hereby, including the assignment of such Material Contract to the Purchaser.

Section 4.13.       Insurance Policies .

(a)                      Schedule 4.13(a) contains a complete and correct list of all insurance policies relating to the Business, the Assets or the Assumed Liabilities carried by or for the benefit of the Parent or any Seller, specifying the insurer, policy number, amount of and nature of coverage, the risk insured against, the deductible amount (if any) and the date through which coverage will continue by virtue of premiums already paid.  The Parent and Sellers maintain insurance with reputable insurers for the Business and Assets against all risks normally insured against, and in amounts normally carried, by corporations of similar size engaged in similar lines of business and such coverage is sufficient.  All insurance policies and bonds with respect to the Business, Assets and the Assumed Liabilities are in full force and effect and will be maintained by the Parent or Sellers in full force and effect as they apply to any matter, action or event relating to each Seller, the Business, Assets and the Assumed Liabilities occurring through the Closing Date and the Parent and Sellers have not reached or exceeded their policy limits for any insurance policies in effect at any time during the past five (5) years.  There is no claim by the Parent or any Seller pending under any of such policies or bonds as to which coverage has been questioned, denied or disputed by the underwriters of such policies or bonds or in respect of which such underwriters have reserved their rights.  All premiums payable under all such policies and bonds have been timely paid, and the Parent and Sellers have otherwise complied fully with the terms and conditions of all such policies and bonds.  Neither the Parent nor any Seller has any Knowledge of any threatened termination of, premium increase with respect to, or material alteration of coverage under, any of such policies or bonds.

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(b)                      Schedule 4.13(b) contains a true, correct and complete list of all policies of liability, theft, fidelity, business interruption, life, fire, product liability, professional liability, workers compensation, health and other material forms of insurance required to be held by the Parent and each Seller pursuant to any Contract with a customer, vendor, payor or supplier.

Section 4.14.       Environmental, Health and Safety Matters .

Except as set forth in Schedule 4.14 , with respect to the Business, Assets, the Assumed Liabilities and the Leased Real Property:

(a)                     the Parent and each Seller and the Business are in compliance in all material respects with all applicable Environmental Laws;

(b)                     the Parent and each Seller possesses, and is in full compliance with, all Permits and has filed all notices that are required under Environmental Laws, and the Parent and each Seller is in compliance with all applicable limitations, restrictions, conditions, standards, prohibitions, requirements, obligations, schedules and timetables contained in those Laws or contained in any law, regulation, code, plan, order, decree, judgment, notice, permit or demand letter issued, entered, promulgated or approved thereunder, in each case in all material respects;

(c)                     there are no Liabilities arising in connection with or in any way relating to the Business, Assets, the Assumed Liabilities or the Leased Real Property of any kind whatsoever, whether accrued, contingent, absolute, determined, determinable or otherwise, arising under or relating to any Environmental Law, and there are no facts, events, conditions, situations or set of circumstances, including notice of actual or threatened Liability under any foreign, state or local statute or ordinance from any Governmental Entity or any third party, which could reasonably be expected to result in or be the basis for any such Liability;

(d)                     no Hazardous Material has been discharged, disposed of, dumped, injected, pumped, deposited, spilled, leaked, emitted or released by the Business or by any of the products sold or installed by the Business;

(e)                     neither the Parent nor any Seller has imported, manufactured, stored, used, operated, transported, treated or disposed of any Hazardous Materials other than in compliance with all Environmental Laws; and

(f)                     for purposes of this Section 4.14, the terms “ Parent ” or “ Seller ” shall include any entity which is, in whole or in part, a predecessor of the Parent or respective Seller, as applicable.

Section 4.15.       Intellectual Property .

Schedule 4.15 sets forth a true and correct list of all Intellectual Property Rights of the Business that is registered with a Governmental Entity and the jurisdictions where each is registered.  The Parent and Sellers have good and marketable title to or possesses adequate licenses or other valid rights to use all Intellectual Property Rights, free and clear of all Liens and have paid all maintenance fees, renewals or expenses related to its Intellectual Property Rights.  Neither the use of the Intellectual Property Rights nor the conduct of the Business in accordance with the past practices, misappropriates, infringes upon or conflicts with any patent, copyright, trade name, trade secret, trademark or other Intellectual Property Rights of any third party.  There are no royalties or fees payable by the Parent or any Seller to any Person by reason of the ownership or use of any of the Intellectual Property Rights.  No party has filed a claim or threatened to file a claim against the Parent or any Seller alleging that it has violated, infringed on or otherwise improperly used the Intellectual Property Rights of such party.  To the Knowledge of the Parent or any Seller, no other Person is infringing upon any Intellectual Property Right of the Business.  All employees of the Parent and Sellers have signed customary assignment of inventions and other intellectual property in favor of the Sellers, and the Parent and each Seller has taken all reasonable precautions necessary to protect the Sellers’ trade secrets.

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Section 4.16.       Transactions with Affiliates .

Except as set forth in Schedule 4.16 , no member, manager, shareholder, employee, officer or director of Parent or any Seller, or any Person with whom any such employee, officer or director has any direct or indirect relation by blood, marriage or adoption, or any entity in which any such person, owns any beneficial interest (other than a publicly held corporation whose stock is traded on a national securities exchange or in the over-the-counter market and less than 5% of the stock of which is beneficially owned by all such Persons in the aggregate) or any Affiliate of any of the foregoing or any current or former Affiliate of the Parent or any Seller have any interest in: (a) any Contract, arrangement or understanding with, or relating to, the Business, the Assets or the Assumed Liabilities; or (b) any property (real, personal or mixed), tangible or intangible, used or currently intended to be used by the Parent or any Seller relating to the Business, the Assets or the Assumed Liabilities.   Schedule 4.16 also sets forth a complete list of all accounts receivable, notes receivable and other receivables and accounts payable owed to or due from any Affiliate to the Parent or any Seller relating to the Business, the Assets or the Assumed Liabilities.

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Section 4.17.       Customer and Supplier Relations .

(a)                      Schedule 4.17(a) contains a complete and accurate list of the names and addresses of the top ten (10) customers of the Business for each of the 2006 and 2007 fiscal years, and for the 2008 stub period (the “ Customers ”).  No event has occurred that would materially and adversely affect the Parent’s or any Seller’s relations with any such Customer.  Except as set forth in Schedule 4.17(a) , no Customer (or former customer) during the last twelve (12) months has canceled, terminated or made any written threat to cancel or otherwise terminate its Contract or to decrease its usage of the Business’s services or products.  Neither the Parent nor the Seller has received notice nor has any Knowledge to the effect that any current customer may terminate or materially alter its business relations with the Business, either as a result of the transactions contemplated by this Agreement or otherwise.

(b)                      Schedule 4.17(b) contains a complete and accurate list of the names and addresses of the top five (5) suppliers of the Business for each of the 2006 and 2007 fiscal years, and for the 2008 stub period (the “ Suppliers ”).  The Parent and Sellers maintain good relations with each of the Suppliers, and no event has occurred that would materially and adversely affect any Seller’s relations with any such Supplier.  Except as set forth in Schedule 4.17(b) , no supplier (or former supplier) during the last twelve (12) months has canceled, terminated or made any threat to cancel or otherwise terminate its Contract or to decrease its supply of services or products.  Neither the Parent nor the Seller has received notice nor has any Knowledge to the effect that any current supplier may terminate or materially alter its business relations with the Business, either as a result of the transactions contemplated by this Agreement or otherwise.

Section 4.18.       Employee Matters .

(a)                     There are no Seller Employee Benefit Plans.

(b)                     The employees of the Business have not been, and currently are not, represented by any labor organization or group whatsoever.  Neither the Parent nor any Seller has been and is not a signatory to any collective bargaining agreement, and no union organizing campaign or other attempt to organize or establish a labor union, employee organization or labor organization involving or representing employees of the Parent or any Seller has occurred, is in progress or is threatened.

(c)                     No workers’ compensation or retaliation claim, complaint, charge or investigation has been filed or is pending against the Parent or any Seller with respect to the Business, and the Parent and Sellers have maintained and currently maintain adequate insurance as required by applicable law with respect to workers’ compensation claims and unemployment benefits claims.

(d)                     The Parent and Sellers are in compliance in all material respects with all applicable laws, regulations and orders and all contracts or collective bargaining agreements governing or concerning labor relations, unions and collective bargaining, conditions of employment, employment discrimination and harassment, wages, hours or occupations safety and health, including, without limitation, ERISA, the Immigration Reform and Control Act of 1986, the National Labor Relations Act, the Civil Rights Acts of 1866 and 1964, the Equal Pay Act, the Age Discrimination in Employment Act, the Americans with Disabilities Act, the Family and Medical Leave Act, the Occupational Safety and Health Act, the Davis Bacon Act, the Walsh-Healy Act, the service Contract Act, Executive Order 11246, the Fair Labor Standards Act and the Rehabilitation Act of 1973 and all regulations under such acts.

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Section 4.19.       Permits .

Except as set forth on Schedule 4.19 , each Seller has all material Permits necessary for its operations in the conduct of the Business, such Permits are in full force and effect and no violations are or have been recorded i