Exhibit 10.1

Canfield Medical Supply, Inc.

4120 Boardman-Canfield Road

Canfield, Ohio 44406

Re: Canfield Medical Supply, Inc.—Splash Beverage Group Inc. Shares Lock-up

Ladies and Gentlemen:

This agreement is being delivered to you, as an officer, director, employee, consultant or beneficial owner of more than 10% of outstanding shares of Splash Beverage Group, Inc., a Nevada corporation (“Company”), in connection with the Agreement and Plan of Merger dated December 31, 2019 (the “Merger Agreement”) among the Company, Canfield Medical Supply, Inc., a Colorado corporation, (“Canfield”) and SBG Acquisition, Inc. a Nevada corporation (“Merger Sub”).

In order to induce Canfield and the Company to enter into the Merger Agreement and the transactions contemplated thereby and pursuant to which the Company will merge with Sub and become a wholly owned subsidiary of Canfield (the “Merger”), and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the undersigned agrees that for a period commencing from the date which follows the date of the Merger and ending 180 days after that date (the “Lock-Up Period”) the undersigned will not directly or indirectly:

Moreover, if:

the Lock-Up Period shall be extended and the restrictions imposed by this agreement shall continue to apply until the expiration of the 18-day period beginning on the date of issuance of the earnings release or the occurrence of the material news or material event, as the case may be, unless the board of directors of Canfield unanimously waives in writing such extension.

Leak-Out Period

Upon termination of the Lock-up Period the undersigned may release from the sale restrictions herein contained up to twenty-five percent (25%) of the Lock-up Securities during ninety (90) days after expiration of Lock Up Period and (ii) release from the sale restrictions herein contained all remaining Lock-up Securities six months after the Lock Up Period (collectively these six months are, the “Leak-Out Period”).

Notwithstanding anything contained above to the contrary, the, Lock-up Securities may be released from the sale restrictions herein contained at any time following the Lock-up Period (the “Early L/U Release”) when both (a) the volume of Canfield shares traded are at least 50,000 shares of common stock per day (the “Volume Condition”) and (b) the closing price per share determined on a volume weighted average price basis equals not less than 300% of deemed value per share (the “Price Condition”) for 20 consecutive trading days (the “Trading Term Condition”) have been met. For purposes hereof “deemed value per share” shall equal the aggregate Canfield enterprise value post-Merger divided by the total number of shares outstanding but in any event shall be not less than $1.00 per share (before giving effect to a proposed reverse stock split currently contemplated to be on a one-for-3.5 shares basis). By way of illustrating an Early Leak-Out Release where both the Volume Condition and the Price Condition are met, if a share of Canfield has a deemed value of $1 upon completion of the Merger then the closing price per share(before giving effect to a reverse stock split,) must be at least $3 on a volume weighted average price basis and trading volume of the common stock must be at least 50,000 shares over each of the 20 consecutive trading days. If either of Volume Condition or the Price Condition is not met over the Trading Term Period then Early Leak-Out Release shall not be available. Notwithstanding the foregoing those shareholders who are not officers of Splash and who have invested $500,000 or more at least six months prior to the Merger shall not be required to enter into the foregoing Lock-up/Leak-out Period agreements.

During the Leak-Out Period, Lock-up Securities may only be sold at or above the lowest "offer" or "ask" prices stated or quoted by the relevant market maker for Canfield’s common stock on the OTC Markets or any nationally recognized exchange on which Canfield’s common stock is publicly traded. The undersigned further agrees that (a) no sales will be made at the "bid" prices for the Common Stock. and that (b) it will not engage in any short selling of the Common Stock during the Lock-Up/Leak-Out Period.

Permitted Transfers During the Lock-Up/Leak-Out Period

Notwithstanding the provisions set forth elsewhere in this letter agreement, the undersigned may, without the prior written consent of Canfield and the Company:

(1) if common stock is owned in the name of a limited liability company (“LLC”) (a) make a pro-rata distribution of the common stock to the members of the LLC, and (b) instruct Canfield’s transfer agent to retitle such common stock on a pro-rata basis in the names of the LLC’s members, and to thereafter hold such distributed common stock either in book entry or certificate form in the names of the LLC members; or

(2) transfer any common stock or any securities convertible into or exchangeable or exercisable for common stock as a bona fide gift or gifts, or by will or intestacy, to any member of the immediate family (as defined below) of the undersigned or to a trust the beneficiaries of which are exclusively the undersigned or members of the undersigned’s immediate family or to a charity or educational institution; 

provided, however, that it shall be a condition to such permitted transfers referenced above that

(A) the transferee executes and delivers to Canfield not later than one business day prior to such transfer, a written agreement, in substantially the form of this agreement and otherwise satisfactory in form and substance to Canfield, and

(B) if the undersigned is required to file a report under Section 16(a) of the Securities Exchange Act of 1934, as amended, reporting a reduction or other change in beneficial ownership of Common Stock or any securities convertible into or exercisable or exchangeable for Common Stock by the undersigned during the Lock-Up Period (as the same may be extended as described above), the undersigned shall include a statement in such report to the effect that such transfer or distribution is not a transfer for value and that such transfer is being made as a gift or by will or intestacy, as the case may be; or

For purposes of this paragraph, “immediate family” shall mean a spouse, child, grandchild or other lineal descendant (including by adoption), father, mother, brother or sister of the undersigned.

(3) exercise or convert currently outstanding warrants, options and convertible debentures, as applicable, and exercise options under an acceptable stock option plan, so long as the undersigned agrees that the shares of common stock received from any such exercise or conversion will be subject to this agreement.

The undersigned further agrees that (i) it will not, during the Lock-Up Period (as the same may be extended as described above), make any demand for or exercise any right with respect to any registration under the Securities Act of 1933, as amended (the “1933 Act”), of any Common Stock or any securities convertible into or exercisable or exchangeable for common stock, including under any current or future registration rights agreement or similar agreement to which the undersigned is a party or under which the undersigned is entitled to any right or benefit to have any securities included in a registration statement filed by the Canfield or the Company for resale or other transaction, and (ii) Canfield and the Company may, with respect to any common stock or any securities convertible into or exercisable or exchangeable for common stock owned or held (of record or beneficially) by the undersigned, cause the transfer agent or other registrar to enter stop transfer instructions and implement stop transfer procedures with respect to such securities during the Lock-Up Period (as the same may be extended as described above).

In addition, the undersigned hereby waives any and all notice requirements and rights with respect to the registration of any securities pursuant to any current or future agreement, instrument, understanding or otherwise, including any registration rights agreement or similar agreement, to which the undersigned is a party or under which the undersigned is entitled to any right or benefit and any tag-along rights or other similar rights to have any securities (debt or equity) included in the offering contemplated by Canfield.

The undersigned hereby represents and warrants that the undersigned has full power and authority to enter into this agreement and that this agreement has been duly executed and delivered by the undersigned and is a valid and binding agreement of the undersigned. This agreement and all authority herein conferred are irrevocable and shall survive the death or incapacity of the undersigned and shall be binding upon the heirs, personal representatives, successors and assigns of the undersigned.

The undersigned agrees that, prior to engaging in any transaction or taking any other action that is subject to the terms of this lock-up agreement during the period from the date hereof to and including the 4th day following the expiration of the Lock-Up Period, the undersigned will give notice thereof to Canfield (a “Transaction Notice”) and will not consummate any such transaction or take any such action unless it has received written confirmation from Canfield that the Lock-Up Period (as may have been extended as described above) has expired (the “Lock-Up Expiration Notice”), provided that if 180 days have elapsed from the date of Merger and Canfield has not forwarded the Lock-Up Expiration Notice to the undersigned within seven days of receipt of a Transaction Notice then the Lock-up Period shall be deemed to have expired. It is further expressly agreed that the restrictions, terms and provisions of this letter do not extend to any participation which the undersigned may undertake, alone or with, others in any bridge or other financing completed from the date of Merger through the end of the Lock-Up/Leak Out Period, it being understood and agreed that the transaction documents of those financings will govern all participants as may therein be set forth.

For avoidance of doubt the Lock-Up Period shall not extend beyond twenty one days after its original termination date after which time such Lock-Up Period shall no longer be in force and effect; and the leak-out term shall not extend beyond twelve months from the date of the Merger after which time such leak-out term shall no longer be in force or effect. .

The undersigned understands and acknowledges that the Company and Canfield are relying upon this lockup agreement in proceeding toward consummation of the Merger.
 

IN WITNESS WHEREOF, the undersigned has executed and delivered this agreement as of the date first set forth below.

Signature Page — Lock Up Letter to Canfield Medical Supply, Inc.

Exhibit 10.2

PROMISSORY NOTE CONVERSION AGREEMENT

This Promissory Note Conversion Agreement (the “Agreement”) is entered into as of February ,2020 by and between Splash Beverage Group, Inc. a Nevada corporation (the “Company”), and (the “Noteholder”), with reference to the following facts:

A.   The Company executed a Promissory Note in favor of Noteholder in the principal amount of $ dated (the “Note”).

B.  The Company intends to merge with a subsidiary of Canfield Medical Supply Inc. (the “Merger”) under terms which require that as of completion of the Merger (i) substantially all of the Company’s debt, which at December 6, 2019 amounted to more than $6 million, and (ii) all shares of the Company’s preferred stock shall be converted into shares of Canfield Medical Supply Inc..

C.   Upon completion of the Merger the Company will be a wholly owned subsidiary of Canfield Medical Supply Inc. (the “Parent”) and shareholders of the Company will own in the aggregate on a fully diluted basis, after giving effect to conversions of all debt and preferred stock, and all outstanding options, and or other rights to acquire Company securities warrants, not less than 85% of Parent, with the ability to receive an additional 1.25% of Parent, for an aggregate total of 86.25% ownership of Parent, computed as of the date of Merger, if the post- Merger Parent is able to sell, issue and receive $9 million of additional equity capital no later than six months after the date of the Merger (the “New Capital”).The post-Merger Parent shall hereinafter be referred to as “SplashPM.”

D.   Conversion by each of the Company’s debt holders shall be at the rate of one share for $1.00 and is further conditioned on SplashPM’s timely satisfaction of its covenant to raise the New Capital (the “New Capital Covenant”), the failure of which for any reason shall provide the Noteholder at its sole discretion the right to rescind the conversion of all debt underlying and evidenced by the Note.

E.   Conversion of the Note shall become effective upon completion of the Merger subject further to the representations, covenants and other terms set forth below.

F.   Based on the foregoing the Company and Noteholder desire to convert the entire amount outstanding under the Note into shares of Company Common Stock, $0.001 par value (the “Common Stock”).

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties agree as follows:

1.   Conversion to Common Stock. The entire amount of outstanding principal and interest under the Note shall be converted shares of Common Stock (the “Conversion Shares”) effective upon the Merger. Upon execution of this Agreement and return of the original Note as described below, SplashPM shall instruct its transfer agent to issue the Conversion Shares to the Noteholder at the address on the signature page hereto.

2.   Return of Note. Following execution of this Agreement and upon the Merger becoming effective, the Note shall be deemed to be paid in full and the Noteholder thereupon shall return the original Note to SplashPM marked “CANCELLED: PAID IN FULL”. If the Merger does not occur prior to the date on which the Merger Agreement is terminated pursuant to Section 10 thereof the original Note shall remain in full effect, shall not be deemed paid in any amount and this Agreement shall terminate.

3.   Restricted Stock; Piggyback Registration Rights. The Conversion Shares to be issued hereunder have not been registered with the United States Securities and Exchange Commission or with the securities regulatory authority of any state. The Conversion Shares are subject to restrictions imposed by federal and state securities laws and regulations on transferability and resale, and may not be transferred assigned or resold except as permitted under the Securities Act of 1933, as amended (the “Act”), and the applicable state securities laws, pursuant to registration thereunder or exemption therefrom. At such time, if ever, that SplashPM determines to file a registration statement with the Securities and Exchange Commission (“SEC”) relating to an offering for its own account, or the account of others under the Act, of any of its equity securities (other than on Form S-4 or Form S-8 or their then equivalents relating to equity securities to be issued solely in connection with any acquisition of any entity or business or equity securities issuable in connection with stock option or other bonafide employee benefit plans) (the “Registration Statement”), SplashPM shall send to Noteholder written notice of such determination and, if within 10 days after the date of receipt of such notice Noteholder shall so request in writing, SplashPM shall include in such registration statement all or any part of the Conversion Shares that Noteholder requests to be registered, provided however any Conversion Shares may be removed pro rata to the percentage of securities being removed by other selling shareholders whose shares are also covered by the Registration Statement (“Removed Conversion Shares”) if such removals are required to comply with any written comments from the SEC with respect to Rule 415 promulgated under the Act. The Company covenants to maintain the effectiveness of the Registration Statement, and of any registration statement filed thereafter which must include the Removed Conversion Shares if any (an “RCS Registration Statement”), by promptly preparing and filing post-effective amendments to the Registration Statement and RCS Registration Statement until all of the Conversion Shares and Removed Conversion Shares are sold. The registration rights granted herein shall remain in full effect and continue to extend to the Conversion Shares and Removed Conversion Shares until they are sold. All fees and costs of or incidental to any such registration statement shall be borne by the Company and SplashPM.

4.   Noteholder Representations. The Company is issuing the Conversion Shares to the Noteholder in reliance upon the following representations made by the Noteholder:

(a)  Noteholder is an “accredited investor” within the meanings set forth in Regulation D promulgated under the Act.

(b)  Noteholder (i) has had, and continues to have, access to detailed information with respect to the business, financial condition, results of operations and prospects of the Company and SplashPM; (ii) has received or has been provided access to all material information concerning an investment in the Company and SplashPM; and (iii) has been given the opportunity to obtain any additional information or documents from, and to ask questions and receive answers of, the officers, directors and representatives of the Company and SplashPM to the extent necessary to evaluate the merits and risks related to an investment in the Company and SplashPM represented by Common Stock.

(c)  As a result of the foregoing and Noteholder’s prior overall experience in financial matters, and Noteholder’s familiarity with the nature of the Company’s businesses and

SplashPM, Noteholder is able to evaluate the capital structure of the Company and SplashPM, the business of the Company and SplashPM, and the risks inherent therein.

(d)  Noteholder’s investment in the Company is consistent, in both nature and amount, with Noteholder’s overall investment program and financial condition.

(e)  Noteholder’s financial condition is such that Noteholder can afford to bear the economic risk of holding the Common Stock, and to suffer a complete loss of Noteholder’s investment in the Company represented by the Note and the Conversion Shares.

(f)    Noteholder’s address is set forth on the signature page hereto. 

(h) In consideration of the promises recited in this Agreement, and other than with respect to the obligations contained in this Agreement, each Noteholder including its successors, agents and assigns hereby does, knowingly and voluntarily, release, acquit and forever discharge the Company and the Company’s successors, assigns, officers, directors, shareholders, attorneys, agents, employees and representatives (collectively the “Releasees”), from any and all claims, suits, demands, causes of action, debts, damages, costs, losses, obligations, judgments, charges, expenses, dues, sums of money, accounts and controversies of whatever kind or nature, direct or indirect, arising in tort or contract, whether known or unknown, contingent or noncontingent, at law or in equity relating to any matters of any kind, whether presently known or unknown, suspected or unsuspected that the Noteholder may possess against any of the Releasees arising from any omissions, acts, facts or damages that have occurred up until and including the effective date of this Agreement and as of the date of the consummation of the Merger.

(l)     Each party to this Agreement has read and understands the following language of Section 1542 of the California Civil Code which provides:

A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM MUST HAVE MATERIALLY AFFECTED HIS SETTLEMENT WITH THE DEBTOR

It is expressly understood and agreed that all rights under Section 1542 of the Civil Code of the State of California are expressly waived by each of the parties to this Agreement, to the full extent allowed by law. Each party to this Agreement, agrees that this Agreement shall extend and apply to all unknown, unsuspected and unanticipated claims, demands, injuries, or damages within the scope of this Agreement and the releases herein. Each party to this Agreement acknowledge that they are aware that statutes exist which render null and void releases and discharges of any claims, rights, demands, liabilities, actions and causes of action which are unknown to the releasing or discharging party at the time of execution of said release and discharge. Each party to this Agreement expressly waives any equivalent provision of any statute of the United States or any other state or jurisdiction with respect to such claims, demands, injuries, or damages within the scope of this Agreement.

(m)   Noteholder hereby agrees that any unit purchase agreement, investors’ rights agreement, and right of first refusal and co-sale agreements between the Company and the Noteholders shall be null and void and of no force and effect as of the date of the Merger.

5.   Company Representations and Covenants. Noteholder is converting the amounts due under the Note for the Conversion Shares in reliance upon the following representations made by the Company:

(a)                The Company is a corporation duly organized, validly existing and in good standing under the laws of the State of Nevada and has all requisite corporate power and authority to carry on its business as now conducted and as proposed to be conducted. The Company is duly qualified as a foreign corporation to do business and is in good standing in every jurisdiction in which its ownership or use of property or the nature of the business conducted by it makes such qualification necessary except where the failure to be so qualified or in good standing would not have a material adverse effect on its operations or financial condition.

(b).                  The Company has the requisite corporate power and authority to execute, deliver and perform its obligations under this Agreement. This Agreement and the issuances of the Conversion Shares, and conversion of the Note and the right to rescind the conversions herein provided if the New Capital is not timely obtained, have been (a) duly approved by the Board of Directors of the Company, and (b) the Conversion Shares, when issued pursuant to the Agreement and upon delivery, shall be validly issued and outstanding, fully paid and non- assessable.

(c).                   The execution, delivery and performance of the Agreement by the Company and the consummation of the transactions contemplated hereby, will not, with or without the giving of notice or the passage of time or both: (a) violate the provisions of the Articles of Incorporation or bylaws of the Company; or (b) violate any judgment, decree, order or award of any court binding upon the Company or will not (c) otherwise prohibit the consummation of any of the transactions contemplated by this Agreement by litigation, statute, rule, regulation, executive order, decree, ruling or injunction enacted, entered, promulgated or endorsed by any governmental authority of competent jurisdiction or any self-regulatory organization having authority over the matters contemplated hereby.

(d).                  This Agreement constitutes the valid and legally binding obligations of the Company and are enforceable against the Company in accordance with its respective terms.

(e).                  The Conversion Shares have not been registered under the Securities Act of 1933, as amended (the “Act”) or under the laws of any state or other jurisdiction, and are or will be issued pursuant to a valid exemption from registration.

(f)                 The Company has advised Noteholder that this Agreement is one of various other Agreements being entered into by the Company and note holders or persons to whom the Company is indebted. The Company represents and affirms that each such noteholder and person is converting debt at $1.00 per share and that no noteholder has or will have terms that are more favorable than those being granted to Noteholder under this Agreement.

(g)                If the Company or SplashPM fail timely to satisfy the New Capital Covenant, within five business days of the date of such non-compliance (“Conversion Covenant Failure”), SplashPM or the Company shall give written notice (the “Non Compliance Notice”) to Noteholder of the Conversion Covenant Failure and Noteholder may within ten business days

thereafter notify the Company or SplashPM of Noteholder’s desire to rescind this Agreement (the “Rescission Election”). Not later than thirteen business days following the date of the Non Compliance Notice, the Company shall send to Noteholder an updated report setting forth all other noteholders who have provided the Company and SplashPM with a Rescission Election and the rescission amounts for each such noteholder (the “Rescission Election Report”). Within five business days following receipt of the Rescission Election Report, Noteholder may deliver a follow-on notice to the Company and SplashPM whereby it either affirms or withdraws its Rescission Election, in its sole discretion. Noteholder at its sole election may rescind this Agreement and return the Conversion Shares issued hereby (with stock powers medallion guaranteed) against the execution and delivery by SplashPM of the replacement promissory note (the “Replacement Note”) attached hereto as Exhibit A, provided however if the Noteholder has not provided the Company with written notice of its intention to rescind within five business days following receipt of the Rescission Election Report then the Noteholder shall be deemed to have waived any rights to rescind under this Section and the right to rescind under this Section shall be null and void. To effect the rescission hereunder Noteholder shall tender the Conversion Shares to SplashPM with an endorsed stock power against delivery by the SplashPM of the executed Replacement Note.

The Company acknowledges that its failure or the failure of SplashPM to issue and deliver the Replacement Note within five business days of exercise of rights hereunder by the Noteholder shall be a material default of this Agreement that will result in all amounts that would have been evidenced by the Replacement Note becoming immediately due and payable together with all costs of collection payable by SplashPM and Company inclusive of all accrued interest thereon from the date of the Merger at a rate of interest of fourteen percent per year until paid in full.

(h)               The Company covenants to Noteholder that no more than $500,000 of bridge loans, notes payable and other debt shall be outstanding as at the date of the Merger (“Permitted Existing Liabilities”) and that the maturity dates of the Permitted Existing Liabilities shall be no earlier than August , 2020. The Company shall cause all Notes evidencing Permitted Existing Liabilities to convert into shares of common stock of SplashPM at a conversion price that will be the greater of (i) 1.25 per share (125% of the price for the conversion agreements that were executed as of the Merger) or (ii) the average of the reported closing price per share of SplashPM’s common stock taken over the three trading days prior to conversion No holder of Permitted Existing Liabilities shall participate in or be awarded any New Capital Bonus Shares. Holders of Permitted Existing Liabilities shall not be granted or otherwise allowed registration or piggyback registration rights

(i)                 The Company and SplashPM covenant to provide piggyback registration rights to the Noteholder on terms not less favorable than those described in paragraph 3 above.

(j)                 Should the Company or SplashPM provide note or debt conversion agreements solely with respect to the debt or note holders having outstanding debt as of the Merger to others on terms, including rescission terms, more favorable than those being accorded to Noteholder hereunder (“Changed Terms”), then this Agreement shall automatically be deemed to include and have the benefit of the Changed Terms. Notwithstanding the foregoing Noteholder in its sole discretion may elect not accept all of the Changed Terms within ten business days after Company and SplashPM have delivered notice of the Changed Terms to Noteholder.

(a)                Governing Law and Venue. This Agreement and all acts and transactions pursuant hereto and the rights and obligations of the parties hereto shall be governed, construed and interpreted in accordance with the laws of the State of Nevada . The parties agree that all actions and proceedings arising out of or relating directly or indirectly to this Agreement or any ancillary agreement or any other related obligations shall be litigated solely and exclusively in the state or federal courts located in the City of Las Vegas, Clark County and that such courts are convenient forums. Each party hereby submits to the personal jurisdiction of such courts for purposes of any such actions or proceedings.

(b)                No modification, variation or amendment of this Agreement (including any exhibit hereto) shall be effective unless made in writing and signed by both parties. The failure by either party to enforce any rights under this Agreement shall not be construed as a waiver of any rights of such party.

(c)                Advice of Counsel. Each party to this Agreement hereby represents and warrants to the other party that it has had an opportunity to seek the advice of its own independent legal counsel with respect to the provisions of this Agreement and that its decision to execute this Agreement is not based on any reliance upon the advice of any other party or its legal counsel. Each party represents and warrants to the other party that in executing this Agreement such party has completely read this Agreement and that such party understands the terms of this Agreement and its significance. This Agreement shall be construed neutrally, without regard to the party responsible for its preparation.

(d)                Due Authorization. Each party to this Agreement hereby represents and warrants to the other party that (i) the execution, performance and delivery of this Agreement has been authorized by all necessary action by such party; (ii) the representative executing this Agreement on behalf of such party has been granted all necessary power and authority to act on behalf of such party with respect to the execution, performance and delivery of this Agreement; and (iii) the representative executing this Agreement on behalf of such party is of legal age and capacity to enter into agreements which are fully binding and enforceable against such party.

(e)                Further Assurances. The Company and Noteholder agree that in case at any time after the Merger any further action is necessary or desirable to carry out the purposes of this Agreement, each of the parties hereto will take such further action (including without limitation, the execution and delivery of such further instruments and documents) as any other party hereto may reasonably request.

(f)                 Counterparts. This Agreement may be executed in any number of counterparts, all of which taken together shall constitute a single instrument.

(g)                Notices. All notices, requests and other communications hereunder shall be in writing and shall be delivered by courier or other means of personal service (including by means of a nationally recognized courier service or professional messenger service), or sent by facsimile or mailed first class, postage prepaid, by certified mail, return receipt requested, in all cases, addressed to:

If to Company:

Splash Beverage Group, Inc. 1314 E. Las Olas Blvd

Suite #221

Fort Lauderdale, Florida 33301

Attention: Robert Nistico, Chief Executive Officer

With a copy to: Sichenzia Ross Ference LLP (which shall not constitute notice)

1185 Avenue of the Americas, 37th Floor New York, New York, 10036

Attention: Darrion Ocasio Docasio@srf.law

If to Noteholder :

____________________________

____________________________

Attention:

With a copy (which shall not constitute notice) to:

[                  ]

All notices, requests and other communications shall be deemed given on the date of actual receipt, delivery or refusal as evidenced by written receipt, acknowledgement or other evidence of actual receipt or delivery to the address specified above. In case of service by facsimile, a copy of such notice shall be personally delivered or sent by registered or certified mail, in the manner set forth above, within three business days thereafter. Any party hereto may from time to time by notice in writing served as set forth above designate a different address or a different or additional Person to which all such notices or communications thereafter are to be given.

(h)                Attorneys’ Fees. In the event that any suit or action is instituted under or in relation to this Agreement, including without limitation to enforce any provision in this Agreement, the prevailing party in such dispute shall be entitled to recover from the losing party all fees, costs and expenses of enforcing any right of such prevailing party under or with respect to this Agreement, including without limitation, such reasonable fees and expenses of attorneys and accountants, which shall include, without limitation, all reasonable fees, costs and expenses of appeals

(i)                 Remedies. All remedies afforded to any party by law or contract, shall be cumulative and not alternative and are in addition to all other rights and remedies a party may have, including any right to equitable relief and any right to sue for damages as a result of a breach of this Agreement. Without limiting the foregoing, no exercise of a remedy shall be deemed an election excluding any other remedy.

(j)                 Successors and Assigns. The rights and benefits of this Agreement shall inure to the benefit of, and be enforceable by the Company's successors and assigns. The covenants and obligations of the Company hereunder shall inure to the benefit of, and be enforceable by the Noteholder against the Company, its successors and assigns, including any entity into which the Company is merged.

(k)                Survival. The representations, warranties, covenants and agreements made herein shall survive the closing of the transaction contemplated hereby. The representations, warranties, covenants and obligations of the Company, and the rights and remedies that may be exercised by the Noteholder, shall not be limited or otherwise affected by or as a result of any information furnished to, or any investigation made by or knowledge of, the Noteholder or any of its representatives.

This Agreement is entered into and effective as of the date first written above.

EXHIBIT A TO NOTE CONVERSION AGREEMENT REPLACEMENT NOTE

THE SECURITIES WHOSE ISSUANCE AND SALE IS REPRESENTED BY THIS DOCUMENT HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THE SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED (I) IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR (B) AN OPINION OF COUNSEL, IN A GENERALLY ACCEPTABLE FORM, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR (II) UNLESS SOLD PURSUANT TO RULE 144 OR RULE 144A UNDER SAID ACT.

PROMISSORY NOTE

FOR VALUE RECEIVED, [ ], Inc., a [ ] corporation (the “Company”), hereby unconditionally promises to pay to the order of [ ] whose address is [ ], or its successors or assigns (the “Holder”), the principal amount of [ ] (USD $[ ]) on or prior to 18 months anniversary (for purpose of this Note 18 months shall consist of 540 days) from the date of the closing of the merger (the “Merger Closing Date”) by and among Canfield Medical Supply, Inc., a Colorado corporation, SBG Acquisition, Inc., a Nevada corporation, and Splash Beverage Group, Inc. the Nevada corporation, (the “Maturity Date”), and to pay interest on the unpaid principal balance hereof at the rate of twelve percent (12%) per annum (the “Applicable Rate”) commencing six months after the Merger Closing Date. This promissory note (the “Note”) is one of several promissory notes (and all modifications, extensions, future advances, supplements, and renewals thereof, and any substitutions therefor of this Note or other promissory notes issued pursuant to the Note Conversion Agreement (the “Other Notes”)) issued pursuant to Promissory Note Conversion Agreement (the “Note Conversion Agreement”), is subject to the terms and conditions contained in the Note Conversion Agreement and shall be payable in accordance with the terms set forth below.

1.                        Payments of Principal and Interest.

(a)                                   Payment of Principal. The principal amount of this promissory note (the “Note”) shall be paid to the Holder on or prior to the Maturity Date.

(b)                                  Payment of Interest. Interest on the unpaid principal balance of this Note shall accrue at the Applicable Rate commencing on the Merger Closing Date. Interest shall be computed on the basis of a 360-day year and paid for the actual number of days elapsed. Interest shall be payable in 15 installments commencing on the 90^th day from the Merger Closing Date and each 30 days thereafter until the Note is paid in full with interest that accrued over the first 90 days following the Merger Closing Date payable pro rata over 15 installments. By way of example, if interest accrued over the first 90 days amounts to $15 and the note is repaid in 15 installments, then each payment of accrued and unpaid interest shall equal the interest amount accrued over preceding 30 days plus $1.

(c)                                   Payment of Default Interest. Any amount of principal or interest on this Note which is not paid within five Business Days of when due shall bear interest from the date due until such past due amount is paid at a rate of interest equal to the Applicable Rate plus three percent (3%) per annum (the “Default Rate”).

(d)                                  General Payment Provisions. All payments of principal of, interest on and other amounts due under this Note shall be made in lawful money of the United States of America by certified bank check or wire transfer to such account as the Holder may designate by written notice to the Company in accordance with the provisions of this Note. Whenever any amount expressed to be due by the terms of this Note is due on any day which is not a Business Day, the same shall instead be due on the next succeeding Business Day. For purposes of this Note, “Business Day” shall mean any day other than a Saturday, Sunday, or a day on which commercial banks in the States of California are authorized or required by law or executive order to remain closed.

(e)                                   No Breach. The Company represents and warrants to the Holder that execution, delivery and performance by the Company of this Note will not (i) conflict with or result in a breach of, or require any consent (which has not been obtained and is in full force and effect) under (x) any organizational document of the Company or any of its subsidiaries or (y) any applicable requirement of law or (z) any order, writ, injunction or decree of any governmental authority binding on the Company or any of its subsidiaries, or (ii) result in a breach of, or require termination of, any term or provision of any contractual obligation of the Company or any of its subsidiaries or (iii) constitute (with due notice or lapse of time or both) a default under any such contractual obligation or (iv) result in or require the creation or imposition of any lien upon any property of the Company or any of its subsidiaries pursuant to the terms of any such contractual obligation.

(f)                                    Prepayment. At any time prior to the Maturity Date, the Company may pre-pay this Note in full or in part without penalty. Upon prepayment of this Note in full, the Holder shall have no further rights under this Note (except for such rights that may specifically survive the payment of the Note).

(a)                                   Events of Default. The occurrence of any of the following events shall constitute an “Event of Default” hereunder: (i) the Company shall fail to pay any installment of interest, principal or other sums due under this Note when any such payment shall be due and payable; (ii) the Company makes an assignment for the benefit of creditors; (iii) any order or decree is rendered by a court which appoints or requires the appointment of a receiver, liquidator or trustee for the Company, and the order or decree is not vacated within sixty (60) days from the date of entry thereof; (iv) any order or decree is rendered by a court adjudicating the Company insolvent, and the order or decree is not vacated within sixty (60) days from the date of entry thereof; (v) the Company files a petition in bankruptcy under the provisions of any Debtor Relief Law; (vi) the Company admits, in writing, its inability to pay its debts as they become due (provided, however, that receipt by the Company of an audit letter from its accountants questioning the viability of the Company as a going concern shall not, in and of itself, be construed as an admission by the Company of its inability to pay its debts as they become due); (vii) a proceeding or petition in bankruptcy is filed against the Company and such proceeding or petition is not dismissed within ninety (90) days from the date it is filed; (viii) the Company files a petition or answer seeking reorganization or arrangement under any Debtor Relief Law or similar law of any other foreign country; (ix) the Company shall fail to perform, comply with or abide by any of the stipulations, agreements, conditions and/or covenants contained in this Note or the Note Conversion Agreement on the part of the Company to be performed complied with or abided by (other than a payment covered by clause (i) above), and such failure is not cured within thirty (30) days after written notice of such failure is delivered by Holder to the Company, (x) the Company or any of its subsidiaries shall fail to pay any indebtedness (excluding indebtedness evidenced by this Note or by the Other Notes) having a principal amount outstanding in excess of $100,000 (“Materiality Amount”), or any payment of principal, interest or premium thereon, when due (whether by scheduled maturity, required prepayment, acceleration, demand or otherwise) and such failure shall continue after the applicable grace period, if any, specified in the agreement or instrument relating to such indebtedness or if the effect of such default or event is to accelerate, or to permit the acceleration of, the maturity of such indebtedness provided that such indebtedness in the aggregate exceeds the Materiality Amount (xi) any representation or warranty made by the Company under this Note or the Note Conversion Agreement shall prove to have been false or misleading when made and (xi) any Event of Default occurs with respect to any Other Notes then outstanding. “Debtor Relief Law” means the Bankruptcy Code of the United States (Title 11), and all other liquidation, conservatorship, bankruptcy, assignment for the benefit of creditors, moratorium, rearrangement, receivership, insolvency, reorganization, or similar debtor relief laws of the United States or other applicable jurisdictions from time to time in effect and affecting the rights of creditors generally.

(b)                                  Notice of an Event of Default. Upon the occurrence of an Event of Default with respect to this Note or any Other Note then outstanding, the Company shall within five (5) Business Days deliver written notice thereof via facsimile or email and overnight courier (with next day delivery specified) (an “Event of Default Notice”) to the Holder. At any time after the occurrence of an Event of Default, the Holder may, by notice to the Company, declare all of the Other Notes to be forthwith due and payable, whereupon the principal and all accrued and unpaid interest thereon, plus all costs of enforcement and collection (including court costs and reasonable attorney’s fees), shall immediately become and be forthwith due and payable, without presentment, demand, protest or further notice of any kind, all of which are hereby expressly waived by the Company

(c)                                   Reserved.

(d)                                  Remedies. Ten Business days after the occurrence of one or more Events of Default, if such Event of Default has not been cured then the Holder, at its option and without further notice, demand or presentment for payment to the Company or others, may declare the then outstanding principal balance of this Note, together with all accrued and unpaid interest at the Default Rate and other sums due under the Note, immediately due and payable, together with all reasonable attorneys’ fees, paralegals’ fees and costs and expenses incurred by the Holder in collecting or enforcing payment thereof (whether such reasonable fees, costs or expenses are incurred in negotiations, all trial and appellate levels, administrative proceedings, bankruptcy proceedings or otherwise), and all other sums due by the Company hereunder, all without any relief whatsoever from any valuation or appraisement laws and payment thereof may be enforced and recovered in whole or in part at any time by one or more of the remedies provided to the Holder at law, in equity, or under this Note; provided, however, that the occurrence of any Event of Default described in clauses (iii) through (viii) above shall make this Note immediately due and payable, without any action on the part of the Holder. The Company hereby waives all presentment for payment, demand, protest, notice of protest and notice of dishonor, and all other notices of any kind to which they may be entitled under applicable laws or otherwise. This provision shall be in addition to, and shall not limit, any other remedies the Holder may have at law or equity.

3.                   Lost or Stolen Note. Upon notice to the Company of the loss, theft, destruction or mutilation of this Note, and, in the case of loss, theft or destruction, of an indemnification undertaking by the Holder to the Company in a form reasonably acceptable to the Company and customary for similar circumstances in commercial lender/borrower circumstances, and, in the case of mutilation, upon surrender and cancellation of the Note, the Company shall execute and deliver a new Note of like tenor and date and in substantially the same form as this Note.

4.                   Cancellation. After all principal, accrued interest and all other sums at any time owed on this Note have been paid in full, this Note shall automatically be deemed canceled, shall be surrendered to the Company for cancellation and shall not be re-issued.

5.                  Governing Law. This Note shall be construed and enforced in accordance with, and all questions concerning the construction, validity, interpretation and performance of this Note shall be governed by, the laws of the State of Nevada, without giving effect to provisions thereof regarding conflict of laws. The Company hereby irrevocably submits to the non-exclusive jurisdiction of the state and federal courts sitting in Clark County in the State of Nevada for the adjudication of any dispute hereunder or in connection herewith or with any transaction contemplated hereby or discussed herein, and hereby irrevocably waives, and agrees not to assert in any suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of any such court, that such suit, action or proceeding is brought in an inconvenient forum or that the venue of such suit, action or proceeding is improper, provided, however, nothing contained herein shall limit the Holder’s ability to bring suit or enforce this Note in any other jurisdiction. Each party hereto hereby irrevocably waives personal service of process and consents to process being served in any such suit, action or proceeding by sending by certified mail or overnight courier a copy thereof to such party at the address indicated in the preamble hereto and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process in any manner permitted by law.

6.                  Remedies, Characterizations, Other Obligations, Breaches and Injunctive Relief. The remedies of the Holder as provided herein shall be cumulative and concurrent and may be pursued singly, successively or together, at the sole discretion of the Holder, and may be exercised as often as occasion therefor shall occur; and the failure to exercise any such right or remedy shall in no event be construed as a waiver or release thereof.

7.                  Specific Shall Not Limit General; Construction. No specific provision contained in this Note shall limit or modify any more general provision contained herein. This Note shall be deemed to be jointly drafted by the Company and the Holder and shall not be construed against any person as the drafter hereof.

 8.                Failure or Indulgence Not Waiver. Holder shall not be deemed, by any act of omission or commission, to have waived any of its rights or remedies hereunder, unless such waiver is in writing and signed by Holder, and then only to the extent specifically set forth in the writing. A waiver on one event shall not be construed as continuing or as a bar to or waiver of any right or remedy to a subsequent event. No failure to exercise and no delay in exercising on the part of the Holder, of any right, remedy, power or privilege hereunder shall operate as a waiver thereof; nor shall any single or partial exercise of any right, remedy, power or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, remedy, power or privilege.

9.                Notice. Notice shall be given to each party at the address indicated in the preamble hereto or at such other address as provided to the other party in writing.

10.              Usury Savings Clause. Notwithstanding any provision in this Note, the total liability for payments of interest and payments in the nature of interest, including, without limitation, all charges, fees, exactions, or other sums which may at any time be deemed to be interest, shall not exceed the limit imposed by the usury laws of the jurisdiction governing this Note or any other applicable law. In the event the total liability of payments of interest and payments in the nature of interest, including, without limitation, all charges, fees, exactions or other sums which may at any time be deemed to be interest, shall, for any reason whatsoever, result in an effective rate of interest, which for any month or other interest payment period exceeds the limit imposed by the usury laws of the jurisdiction governing this Note, all sums in excess of those lawfully collectible as interest for the period in question shall, without further agreement or notice by, between, or to any party hereto, be applied to the reduction of the outstanding principal balance of this Note immediately upon receipt of such sums by the Holder hereof, with the same force and effect as though the Company had specifically designated such excess sums to be so applied to the reduction of such outstanding principal balance and the Holder hereof had agreed to accept such sums as a penalty-free payment of principal; provided, however, that the Holder of this Note may, at any time and from time to time, elect, by notice in writing to the Company, to waive, reduce, or limit the collection of any sums in excess of those lawfully collectible as interest rather than accept such sums as a prepayment of the outstanding principal balance. It is the intention of the parties that the Company does not intend or expect to pay nor does the Holder intend or expect to charge or collect any interest under this Note greater than the highest non-usurious rate of interest that may be charged under applicable law.

11.              Binding Effect. This Note shall be binding upon the Company and the successors and assigns of the Company and shall inure to the benefit of Holder and the successors and assigns of Holder.

12.              Severability. In the event any one or more of the provisions of this Note shall for any reason be held to be invalid, illegal, or unenforceable, in whole or in part, in any respect, or in the event that any one or more of the provisions of this Note operates or would prospectively operate to invalidate this Note, then and in any of those events, only such provision or provisions shall be deemed null and void and shall not affect any other provision of this Note. The remaining provisions of this Note shall remain operative and in full force and effect and shall in no way be affected, prejudiced, or disturbed thereby.

13.              Assignability. Upon the written consent of the Company, which shall not be unreasonably withheld, Holder may sell or assign, in whole or in part, or grant participations in this Note and/or the obligations evidenced hereby. The holder of any such sale, assignment or participation, if the applicable agreement between Holder and such holder so provides, shall be: (a) entitled to all of the rights, obligations and benefits of Holder (to the extent of such holder’s interest or participation); and (b) deemed to hold and may exercise the rights of setoff or banker’s lien with respect to any and all obligations of such holder to the Company (to the extent of such holder’s interest or participation) set forth herein through paragraph 14 below; in each case as fully as though the Company was directly indebted to such holder.

14.              Amendments. The provisions of this Note may be changed only by a written agreement executed by the Company and Holder.

[Signature page follows]

Agreement and Plan of Merger dated as of

December 31, 2019

and entered into by and among

Canfield Medical Supply, Inc., a Colorado corporation

and

SBG Acquisition Inc., a Nevada Corporation,

and

Splash Beverage Group, Inc., a Nevada corporation,

AGREEMENT AND PLAN OF MERGER

This Agreement and Plan of Merger (this “Agreement”), dated as of December 31, 2019, is entered into by and among Canfield Medical Supply, a Colorado corporation (“Parent”), SBG Acquisition Inc., a Nevada corporation wholly owned by Parent (“Sub”), and Splash Beverage Group, Inc., a Nevada corporation (“Company” or "Splash"), with respect to the following matters:

RECITALS

A.                 Company develops and markets innovative beverages and naturally flavored tequilas under the "Salt" brand as well as performance drinks, under the "TapouT" brand, containing a proprietary blend of essential vitamins, minerals and electrolytes products.

B.                 The Boards of Directors of Parent, Sub and Company have each determined that it is advisable and in the best interests of their respective stockholders to consummate, and have approved, the business combination transaction provided for herein that constitutes a tax-free transaction meeting the requirements of Section 368(a) of the United States Internal Revenue Code of 1986, as amended (the “Code”), in which Sub would merge with and into Company and Company would become a wholly-owned subsidiary of Parent (the “Merger”). The Boards of Directors of Parent, Sub and Company further intend, by executing this Agreement, to adopt a plan of reorganization within the meaning of Section 354(a) of the Code.

C.                 Parent, Sub, and Company desire to make certain representations, warranties and agreements in connection with the Merger and also to prescribe various conditions to the Merger.

AGREEMENT

Now therefore, in consideration of the mutual covenants and agreements contained herein, and certain other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto covenant and agree as follows:

Section 1. The Merger.

1.1               The Merger. At the Effective Time (as defined in Section 1.2), upon the terms and subject to the conditions of this Agreement, Sub shall be merged with and into Company in accordance with, as applicable, Chapter 92A and such other provisions as are applicable of the Nevada Revised Statutes (the “Nevada Statutes”). Company shall be the surviving corporation in the Merger (the “Surviving Corporation”). Sub and Company are sometimes referred to herein as the “Constituent Corporations.” As a result of the Merger, the outstanding shares of capital stock of the Constituent Corporations shall be converted or cancelled in the manner provided in Section 2.

1.2               Effective Time. At the Closing (as defined in Section 1.3), a certificate or certificates of merger (each and collectively, the “Certificate of Merger”) shall be duly prepared and executed by the Surviving Corporation and thereafter delivered to the Secretary of State of the State of Nevada (the “Nevada Secretary of State”) for filing, as provided in Chapter 92A the Nevada Statutes, on, or as soon as practicable after, the Closing Date (as defined in Section 1.3). The Merger shall become effective at the time of the filing of the Certificate of Merger with the Nevada Secretary of State (the date and time of such filing being referred to herein as the “Effective Time”).

1.3               Closing. The closing of the Merger (the “Closing”) will take place at the offices of Sichenzia Ross Ference 1185 Avenue of the Americas, New York, New 10036, or at such other place as the parties hereto mutually agree, on a date and at a time to be specified by the parties, which shall in no event be later than 10:00 a.m., local time, on the first business day following satisfaction of the conditions set forth in Sections 6.2 and 7.2, provided that the other closing conditions set forth in Sections 6, 7 and 8 have been satisfied or, if permissible, waived in accordance with this Agreement, or on such other date as the parties hereto mutually agree (the “Closing Date”). At the Closing there shall be delivered to Parent, Sub and Company the certificates and other documents and instruments required to be delivered hereunder, including without limitation, under Sections 7 and 8.

1.4               Articles of Incorporation and Bylaws of the Surviving Corporation. At the Effective Time, (i) the Articles of Incorporation of Company as in effect immediately prior to the Effective Time shall be the Articles of Incorporation of the Surviving Corporation until thereafter amended as provided by law and such Articles of Incorporation, and (ii) the Bylaws of Company as in effect immediately prior to the Effective Time shall be the Bylaws of the Surviving Corporation until thereafter amended as provided by law, the Articles of Incorporation of the Surviving Corporation and such Bylaws.

1.5               Directors and Officers of the Surviving Corporation and of Parent. The directors of Company and the officers of Company immediately prior to the Effective Time shall, from and after the Effective Time, be the directors and officers of the Surviving Corporation. As of the Effective Time, all officers and directors of the Parent and Sub, including Michael J. West and Stephen H. West, shall have resigned as directors and officers of the Parent and Sub. The Board of the Parent from and after the Effective Time shall consist of five directors one of whom shall be appointed by WesBev LLC, a principal shareholder of Parent, and three of whom shall qualify as “independent directors” as that term is defined by Nasdaq Corporate Governance Rules, until their successors shall have been duly elected or appointed and qualified or until their earlier death, resignation or removal in accordance with the Surviving Corporation’s or Parent’s Articles of Incorporation and Bylaws, as the case may be.

1.6               Effects of the Merger. Subject to the foregoing, the effects of the Merger shall be as provided in the applicable provisions of the Nevada Statutes.

1.7               Further Assurances. Each party hereto will execute such further documents and instruments and take such further actions as may reasonably be requested by one or more of the others to consummate the Merger, to vest the Surviving Corporation with full title to all assets, properties, rights, approvals, immunities and franchises of either of the Constituent Corporations or to effect the other purposes of this Agreement.

Section 2. Conversion of Shares; Acquisition of Certain Outstanding Parent Shares.

2.1               Conversion of Capital Stock. At the Effective Time, by virtue of the Merger and without any action on the part of the holder thereof:

(a)                       Capital Stock of Sub. Each issued and outstanding share of the common stock, $0.001 par value per share, of Sub (“Sub Common Stock”) shall be converted into and become one fully paid and nonassessable share of common stock, $0.001 par value per share, of the Surviving Corporation (“Surviving Corporation Common Stock”). Each certificate representing outstanding shares of Sub Common Stock shall at the Effective Time represent an equal number of shares of Surviving Corporation Common Stock.

(b)                       Cancellation of Treasury Stock and Stock Owned by Parent and Subsidiaries. All shares of common stock, $0.001 par value per share, of Company (“Company Common Stock”) that are owned by Company as treasury stock and any shares of Company Common Stock owned by Parent, Sub or any other wholly-owned Subsidiary (as hereinafter defined) of Parent shall be canceled and retired and shall cease to exist and no stock of Parent or other consideration shall be delivered in exchange therefor and the Parent shall provide the Company with a certificate of the transfer agent of the Parent and Sub and any Subsidiary certifying to the cancellation of such shares. As used in this Agreement, “Subsidiary” means, with respect to any party, any corporation or other organization, whether incorporated or unincorporated, of which more than fifty percent (50%) of either the equity interests in, or the voting control of, such corporation or other organization is, directly or indirectly through Subsidiaries or otherwise, beneficially owned by such party.

(c)                     Exchange Ratio for Company Common Stock. Each issued and outstanding share of Series A convertible preferred stock, each issued and outstanding share of Series B convertible preferred stock and each issued and outstanding share of common stock (other than shares to be canceled in accordance with Section 2.1(b)) of the Company (respectively, the “Series A Preferred Stock,” the “Series B Preferred Stock” and the “Splash Common Stock”) respectively, shall be converted into an amount of fully paid and nonassessable shares of common stock of Parent (the “Parent Common Stock”) equal to the Conversion Number for the Company’s Series A Preferred Stock, Series B Preferred Stock, Splash Common Stock subject to adjustment as may be otherwise set forth in this Agreement. All such shares of Splash Common Stock and Series A Preferred Stock and Series B Preferred Stock shall no longer be outstanding and shall automatically be canceled and retired and shall cease to exist, and each holder of a certificate representing any such shares shall cease to have any rights with respect thereto, except the right to receive the shares of Parent Common Stock, to be issued in consideration therefor, upon the surrender of such certificate in accordance with Section 2.2, without interest. For purposes hereof, subject to adjustment as may be otherwise set forth in this Agreement and before giving effect to a proposed reverse stock split which shall be in a range of not less than 1-for-3 nor more than 1-for-3.5, the “Conversion Number” shall be 1.362921798 shares of Parent Company Stock for (i) each share of Company Common Stock outstanding, (ii) each share of Series A Preferred Stock outstanding, (iii) for each share of Series B Preferred Stock outstanding and for (iv) each warrant to purchase Company Common Stock outstanding . Without limiting the generality of the foregoing immediately prior to consummation of the Merger the capitalization of the Parent shall be as set forth on Schedule 2.1(c). Securities issued hereunder shall bear the appropriate federal securities legends and affixing as relevant such additional legends referencing the lock-up/leak out and rescission rights referenced elsewhere in this Agreement.

(d)               Dissenting Shares.

(i)                 The Company shall obtain the approval of its shareholders (determined as of the date immediately preceding the Closing) (inclusive of shareholders who are converting debt, preferred stock and who are holders of options, warrants and other rights to acquire equity securities of the Company, collectively the “Company Shareholders”) holding at least a majority of the Company’s voting capital stock to the Merger and the transactions contemplated hereby and pursuant thereto.

(ii)               Unless otherwise required by the applicable provisions of the Nevada Statutes, including without limitation, the provisions of Section 78.3793 thereof, the Company shall not be obligated to offer any appraisal or other “dissenter’s rights”) to the Company Shareholders.

(iii)             If required by the applicable provisions of the Nevada Statutes, including without limitation, the provisions of Section 78.3793 thereof, each outstanding share of Company Common Stock the holder of which has not voted in favor of the Merger, has perfected such holder’s right to an appraisal of such holder’s shares in accordance with the applicable provisions of the Nevada Statutes and has not effectively withdrawn or lost such right to appraisal (a “Dissenting Share”), shall not be converted into or represent a right to receive shares of Parent Common Stock pursuant to Section 2.1I, but the holder thereof shall be entitled only to such rights as are granted by the applicable provisions of the Nevada Statutes; provided, however, that any Dissenting Share held by a person at the Effective Time who shall, after the Effective Time, withdraw the demand for appraisal or lose the right of appraisal, in either case pursuant to the Nevada Statutes, shall be deemed to be converted into, as of the Effective Time, the right to receive shares of Parent Common Stock pursuant to Section 2.1I. In such event, Company shall give Parent (x) prompt notice of any written demands for appraisal, withdrawals of demands for appraisal and any other instruments served pursuant to the applicable provisions of the Nevada Statutes relating to the appraisal process received by Company and (y) the Business to direct all negotiations and proceedings with respect to demands for appraisal under the Nevada Statutes. Company will not voluntarily make any payment with respect to any demands for appraisal and will not, except with the prior written consent of Parent, settle or offer to settle any such demands.

2.2               Exchange of Certificates.

(a)                Exchange Agent. On the Closing Date, Parent shall make available to EQ by Equiniti, Parent’s independent stock transfer agent (the “Exchange Agent”), certificates representing the number of duly authorized shares of Parent Common Stock issuable in connection with the Merger, to be held for the benefit of and distributed to the holders of Company Common Stock in accordance with this Section. The Exchange Agent shall agree to hold such shares of Parent Common Stock (such shares of Parent Common Stock being referred to herein as the “Exchange Fund”) for delivery as contemplated by this Section and upon such additional terms as may be agreed upon by the Exchange Agent, Company and Parent.

(b)               Exchange Procedures. As soon as reasonably practicable after the Effective Time and subject to the surrender provisions of this Section 2.2(b), the Exchange Agent shall deliver to each holder of record of a certificate or certificates which promptly prior to the Effective Time represented outstanding shares of Company Common Stock (the “Certificates”) whose shares are converted pursuant to Section 2.1(c) into the right to receive shares of Parent Common Stock a certificate representing that number of shares of Parent Common Stock which such holder has the right to receive pursuant to the provisions of this Section 2. Upon surrender of a Certificate for cancellation to the Exchange Agent, together with such endorsements for transfer duly executed and completed, the holder of such Certificate shall be entitled to receive in exchange therefor a certificate representing that number of shares of Parent Common Stock which such holder has the right to receive pursuant to the provisions of this Section 2, and the Certificate so surrendered shall forthwith be canceled. In no event shall the holder of any Certificate be entitled to receive interest on any property to be received in the Merger. In the event of a transfer of ownership of Company Common Stock which is not registered in the transfer records of Company, a certificate representing that number of whole shares of Parent Common Stock may be issued to a transferee if the Certificate representing such Company Common Stock is presented to the Exchange Agent accompanied by all documents required to evidence and effect such transfer and by evidence that any applicable stock transfer taxes have been paid. Until surrendered as contemplated by this Section 2.2(b), each Certificate shall be deemed at any time after the Effective Time for all corporate purposes of Parent, except as limited by paragraph (c) below, to represent ownership of the number of shares of Parent Common Stock into which the number of shares of Company Common Stock shown thereon have been converted as contemplated by this Section 2.

(c)              Distributions with Respect to Unexchanged Shares. No dividends or other distributions declared or made after the Effective Time with respect to Parent Common Stock with a record date on or after the Effective Time shall be paid to the holder of any unsurrendered Certificate with respect to the shares of Parent Common Stock represented thereby until the holder of record of such Certificate shall surrender such Certificate in accordance with this Section. Subject to the effect of applicable laws, following surrender of any such Certificate, there shall be paid to the record holder of the certificates representing shares of Parent Common Stock issued in exchange therefor, without interest, (i) at the time of such surrender, the amount of dividends or other distributions, if any, with a record date on or after the Effective Time which theretofore became payable, but which were not paid by reason of the immediately preceding sentence, with respect to such whole shares of Parent Common Stock, and (ii) at the appropriate payment date, the amount of dividends or other distributions with a record date on or after the Effective Time but prior to surrender and a payment date subsequent to surrender payable with respect to such whole shares of Parent Common Stock.

(d)               No Further Ownership Rights in Company Common Stock. All shares of Parent Common Stock issued upon the surrender for exchange of Certificates in accordance with the terms hereof shall be deemed to have been issued at the Effective Time in full satisfaction of all rights pertaining to the shares of Company Common Stock represented thereby, subject, however, to the Surviving Corporation’s obligation to pay any dividends which may have been declared by Company on such shares of Company Common Stock in accordance with the terms of this Agreement and which remained unpaid at the Effective Time. From and after the Effective Time, the stock transfer books of Company shall be closed and there shall be no further registration of transfers on the stock transfer books of the Surviving Corporation of the shares of Company Common Stock which were outstanding immediately prior to the Effective Time. If, after the Effective Time, Certificates are presented to the Surviving Corporation for any reason, they shall be canceled and exchanged as provided in this Section.

(e)                Fractional Shares. No fractional shares or scrip representing fractional shares of Parent Common Stock will be issued in the Merger upon the surrender for exchange of Certificates and instead shall be rounded to the next whole share.

(f)                 Termination of Exchange Fund. Any portion of the Exchange Fund which remains undistributed to the stockholders of Company for three (3) months after the Effective Time shall be delivered to the Surviving Corporation, upon demand, and any stockholders of Company who have not theretofore complied with this Section 2 shall thereafter look only to the Surviving Corporation (subject to abandoned property, escheat and other similar laws) as general creditors for payment of their claim for Parent Common Stock, any cash in lieu of fractional shares of Parent Common Stock and any dividends or distributions with respect to Parent Common Stock. Neither Parent nor the Surviving Corporation shall be liable to any holder of shares of Company Common Stock for shares of Parent Common Stock (or dividends or distributions with respect thereto) or cash payable in respect of fractional share interests delivered to a public official pursuant to any applicable abandoned property, escheat or similar law.

Section 3. Representations and Warranties of Company. Company represents and warrants to Parent and Sub as follows:

3.1               Corporate Existence, Power and Authority. Company is a corporation duly organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation and has all requisite corporate power and authority to conduct its business (the “Business”) as now being conducted, and to own, lease or otherwise hold its properties, to enter into this Agreement, and to carry out the Merger Transactions (as defined below) to which it is a party. For purposes hereof, “Merger Transactions” shall mean the Merger and such other transactions as may be contemplated hereby or in connection herewith, including but not limited to those transactions described in Promissory Note Conversion Agreements and Preferred Stock Conversion Agreements and Lockup/Leak-out Agreements, forms of which are attached to this Agreement.

3.2               Corporate Action. The execution and delivery of this Agreement by Company and the consummation by Company of the Merger Transactions to which it is a party have been authorized by all requisite corporate action on the part of Company.

3.3               Validity. This Agreement constitutes the legal, valid and binding obligation of Company enforceable in accordance with its terms except as enforcement may be limited by bankruptcy, reorganization, insolvency, moratorium or other similar laws presently or hereafter in effect affecting the enforcement of creditors’ rights generally and subject to general principles of equity.

3.4               Financial Statements. The audited financial statements of Company as of and for the years ended December 31, 2017 and 2018, and unaudited financial statements for the interim nine month period ended September 30, 2019, which have been delivered to Parent, or will be delivered prior to the Closing (hereinafter referred to as the “Company Financial Statements”), fairly present, to the knowledge of the Company, the financial condition of Company as of the dates thereof and the results of its operations for the periods covered thereby. To the knowledge of the Company, other than as set forth in any schedule or exhibit attached hereto, and except as may otherwise be set forth or referenced herein, there are no material liabilities or obligations, either fixed or contingent, not disclosed or referenced in the Company Financial Statements or in any exhibit or notes thereto other than contracts or obligations occurring in the ordinary course of business since September 30, 2019; and no such contracts or obligations occurring in the ordinary course of business constitute liens or other liabilities which materially alter the financial condition of Company as reflected in the Company Financial Statements. Company has, or will have at the Closing, good title to all assets, properties or contracts shown on the Company Financial Statements subject only to dispositions and other transactions in the ordinary course of business, the disclosures set forth herein and therein and liens and encumbrances of record disclosed therein.

3.5               Qualification as a Foreign Corporation. Each of the Company and its several subsidiaries (collectively “Subsidiaries”) is duly qualified and in good standing as a foreign corporation and licensed to conduct the Business as now being conducted in each jurisdiction in which Company and Subsidiaries are required to be qualified to conduct the Business, except where failure to be so qualified, in good standing and licensed would have no material and adverse impact on the ownership of its assets and properties or the conduct of the Business.

3.6               Conflict with Other Instruments. Neither the execution and delivery of this Agreement by Company nor the consummation by Company of the Merger Transactions to which it is a party will (i) conflict with, or result in a breach of, the terms, conditions or provisions of, or constitute a default (or an event which with notice or lapse of time or both would become a default) under, or result in the creation of a lien or encumbrance on, or cause the triggering of a “due on sale” clause or similar restriction or provision affecting, any of its assets or properties pursuant to (A) the articles of incorporation or bylaws of Company or (B) any material indenture, mortgage, lease, agreement or other instrument to which Company is a party or by which it, or any of its assets or properties, may be bound or affected (including without limitation any of the Company’s Permitted Closing Debt.as defined in paragraph 5.9 below), or (ii) violate any provision of law, statute, rule or regulation to which Company is subject or by which it or its properties are bound except where such violation would have no material and adverse impact on the ownership of its assets or properties or the conduct of the Business.

3.7               Capitalization. The authorized capital stock of Company consists of 50,000,000 shares of common stock, $0.001 par value, 3,000,000 shares of Series A convertible preferred stock and 11,000,000 shares of Series B convertible preferred stock. As of the date hereof, there are 19,248,781 shares of common stock of Company, 3,000,000 shares of Series A Preferred Stock and 3,913,412 shares of Series B Preferred Stock issued and outstanding, respectively. Entities and persons set forth on Schedule I (the “Company Shareholders”) own the shares of Company Common Stock, Series A Preferred Stock, or Series B Preferred Stock as set forth on Schedule 3.7. The Series A Preferred Stock and the Series B Preferred Stock are sometimes hereafter referred to as the “Splash Preferred Stock.” All of the issued and outstanding shares of Splash Common Stock and all of the issued and outstanding shares of Splash Preferred Stock have been duly authorized and validly issued and are fully paid and nonassessable and free of preemptive rights. Except as set forth on Schedule 3.7, there are no voting trusts, shareholder agreements or other voting arrangements, capacities, charges, liens or encumbrances on any shares of Splash Stock that have been entered into by Company Shareholders. Except as set forth on Schedule 3.7 there are no outstanding subscriptions, contracts, convertible or exchangeable securities, options, warrants, calls or other rights obligating Company to issue, sell, exchange, or otherwise dispose of, or to purchase, redeem or otherwise acquire, shares of, or securities convertible into or exchangeable for, capital stock of Company.

3.8               No Adverse Change. To the knowledge of Company, since September 30, 2019: (i) there has been no material adverse change in the condition, financial or otherwise, of the Business or its assets or properties, or in the prospects thereof or therefor; and, (ii) since September 30, 2019 none of its assets or properties or the Business has been adversely affected in any material way by, or sustained any material loss, whether or not insured, as a result of any fire, flood, accident, explosion, strike, labor disturbance, riot, act of God or the public enemy or other calamity or casualty. Except as disclosed to Parent in writing pursuant to this Agreement and since September 30, 2019, Company (i) has not become involved in any unresolved labor trouble or dispute which materially and adversely affects the Business, (ii) has not become a party to any collective bargaining agreement, (iii) has not suffered any liability, judgment, lien or termination of contract or the imposition of any obligation, the effect of which shall be materially adverse to the Business or its assets or properties, (iv) there has not been any change, event or development having, or that could be reasonably expected to have, individually or in the aggregate, a material adverse effect on Parent and its Subsidiaries taken as a whole, other than those occurring as a result of general economic or financial conditions or other developments which are not unique to Parent and its Subsidiaries but also generally affect other persons who participate or are engaged in the lines of business in which Parent and its Subsidiaries participate or are engaged and (v) between such date and the date hereof Parent and its Subsidiaries have conducted their respective businesses only in the ordinary course consistent with past practice or as contemplated in connection with this Agreement. Without limiting the generality of the foregoing, since September 30, 2019, Company has operated its businesses in the ordinary course of business in all material respects and there has not been, with respect to the businesses, and other than in the ordinary course of business any:

(a)                event, occurrence or development that has had a Material Adverse Effect;

(b)               incurrence of any indebtedness for borrowed money in connection with the Business in an aggregate amount exceeding $25,000, except unsecured current obligations and liabilities incurred in the ordinary course of business;

(c)                sale or other disposition of any of the assets shown or reflected in the balance sheet of the Parent;

(d)               cancellation of any debts or claims or amendment, termination or waiver of any rights of Company, except in the ordinary course of business;

(e)                imposition of any encumbrance upon any of assets of the Company or its Subsidiaries;

(f)                 increase in the compensation of any employees, other than as provided for in any written agreements or in the ordinary course of business;

(g)               adoption, termination, amendment or modification of any employee benefit plan;

(h)               adoption of any plan of merger, consolidation, reorganization, liquidation or dissolution or filing of a petition in bankruptcy under any provisions of federal or state bankruptcy law or consent to the filing of any bankruptcy petition against it under any similar law; or

(i)                 any agreement to do any of the foregoing, or any action or omission that would result in any of the foregoing.

3.9               Assets; Title to Assets. The assets or properties of Company consist principally of tangible and intangible assets, including know how and other intellectual property (the “Intellectual Property”), all as further described on Schedule 3.9 (the “Principal

Assets”). The Company has good and marketable title to the Principal Assets, free and clear of all mortgages, liens, claims or encumbrances of any kind or any conditional sale agreement or other title retention agreement.

3.10           Material Contracts. The Company has furnished or made available to Parent accurate and complete copies or detailed descriptions of Company Material Contracts (as defined below) applicable to Company including the Intellectual Property. With respect to any Company Material Contract, Company is not aware of any existing breach, default or event of default by Company, or event that with notice or lapse of time or both would constitute a breach, default or event of default by Company, other than breaches, defaults or events of default that would not have a material adverse effect on the business, assets or prospects of Company (a “Company Material Adverse Effect”), nor does Company know of, and Company has not received notice of, or made a claim with respect to, any breach or default by any other party thereto that would, severally or in the aggregate, have a Company Material Adverse Effect. As used herein, the term “Company Material Contracts” shall mean all (i) employee benefit plans, share option schemes or agreements and employment, consulting or similar contracts, (ii) contracts that involve remaining aggregate payments by Company in excess of $50,000 or which have a remaining term in excess of two years, (iii) insurance policies, and (iv) all contracts that would, if terminated, have a Company Material Adverse Effect.

3.11           Litigation, Etc. Except as and to the extent as may be set forth in Schedule 3.11 annexed hereto, there are no actions, suits, claims investigations or proceedings pending in any court or by or before any governmental agency to which Company is a party or otherwise affecting the Principal Assets or the Business as now or heretofore conducted by Company, and, to Company’s knowledge, after due inquiry, there is no action, suit, claim, investigation, proceeding, grievance or controversy threatened against Company with regard to or affecting the Principal Assets or the Business as now or heretofore conducted by it. There is no action, suit, claim, investigation or proceeding known to Company, after due inquiry, which is pending or threatened which questions the validity or propriety of this Agreement or any action taken or to be taken by Company in connection with this Agreement. Company is not subject to any judicial injunction or mandate or any quasi-judicial order or quasi-judicial restriction directed to or against it as a result of its ownership of the Principal Assets or its conduct of the Business as now or heretofore conducted by it and no governmental agency has at any time challenged or questioned in writing, or commenced or given notice of intention to commence any investigation relating to, the legal right of Company to conduct the Business or any part thereof as now or heretofore conducted by it, so as to materially and adversely affect the ownership and use of the Principal Assets.

3.12           Compliance with Laws, Etc. Company has complied with all laws and regulations of any applicable jurisdiction with which it is or was required to comply in connection with its ownership of the Principal Assets and its conduct of the Business, the enforcement of which would have a material and adverse effect on the ownership of the Principal Assets or the conduct of the Business. Company has all permits and permissions of governments, governmental authorities and quasi-governmental authorities necessary to own the Principal Assets and to conduct the Business as now conducted, except where failure to have such permits and permissions would have no material and adverse effect on the ownership of the Principal Assets or the conduct of the Business.

3.13           Governmental Approvals. No authorization, consent or approval or other order or action of or filing or registration with any court, administrative agency, or other governmental or regulatory body or authority is required for the execution and delivery by Company of this Agreement or Company’s consummation of the Merger Transactions to which it is a party.

3.14           ERISA. Except as and to the extent as may be set forth in Schedule 3.14 annexed hereto, (i) Company has never sponsored, maintained or contributed to any employee pension benefit plan, within the meaning of Section 3(2) of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”); (ii) is not required to contribute to, nor has ever been required to contribute to, any multi-employer plan within the meaning of Section 3(37)(A) of ERISA; (iii) does not sponsor or contribute to any employee welfare benefit plan within the meaning of Section 3(1) of ERISA, nor has it entered into any pay arrangements, plans or programs that are ERISA Plans; or (iv) have an ERISA or non-ERISA Plan that provides benefits, including, without limitation, death, health or medical benefits (whether or not insured), with respect to current or former employees beyond their retirement or other termination of service other than coverage mandated by applicable law, deferred compensation benefits accrued as liabilities on financial statements, or benefits, the full cost of which are borne by the current or former employee or his beneficiary. The consummation of the transactions contemplated by this Agreement will not entitle any current or former employee or officer of Company to severance pay, unemployment compensation or any other payment, accelerate the time of payment or vesting, or increase the amount of compensation or benefits due any such employee or officer.

3.15           Employee Plans. Except as otherwise disclosed herein or in Schedule 3.15 annexed hereto, neither Company nor any predecessor or subsidiary thereof has or maintains any employee benefit, bonus, incentive compensation, profit-sharing, equity, stock bonus, stock option, stock appreciation rights, restricted stock, other stock-based incentive, executive compensation agreement, employment agreement, deferred compensation, pension, stock purchase, employee stock ownership, savings, pension, retirement, supplemental retirement, employment related change-in-control, severance, salary continuation, layoff, welfare (including, without limitation, health, medical, prescription, dental, disability, salary continuation, life, accidental death, travel accident, and other insurance), vacation, holiday, sick leave, fringe benefit, or other benefit plan, program, or policy, whether qualified or nonqualified and any trust, escrow, or other agreement related thereto, covering any present or former employees, directors, or their respective dependents.

3.16           Certain Payments. To Company’s knowledge, neither Company nor any of its officers, employees or agents, nor any other person acting on behalf of Company, has directly or indirectly, within the past five (5) years, given or agreed to give any gift or similar benefit to any person who is, or may be in a position to help or hinder Company’s business, or assist it in connection with any actual or proposed transaction, which (i) might be reasonably expected to subject it to any material damage or penalty in any action or to have a Company Material Adverse Effect on Company or its business, assets, properties, financial condition or results of operations (a “ Material Adverse Effect”), (ii) if not given in the past, might have reasonably been expected to have had a Material Adverse Effect, or (iii) if not continued in the future, might be reasonably expected to have a Material Adverse Effect or to subject Company to material suit or penalty in any action.

3.17           Hazardous Waste. To Company’s knowledge, neither Company nor any previous owner, tenant, occupant or user of any real property now or previously owned or occupied by Company (“Real Property”) used, generated, manufactured, treated, handled, refined, processed, released, discharged, stored or disposed of any Hazardous Materials (as defined below) on, under, in or about the Real Property, or transported any Hazardous Materials to or from the Real Property. “Hazardous Materials,” as used herein, refers to any flammable materials, explosives, radioactive materials, asbestos, organic compounds known as polychlorinated biphenyls, chemicals now known to cause cancer or reproductive toxicity, pollutants, contaminants, hazardous wastes, toxic substances or related materials, including, without limitation, any substance defined as or included in the definition of “hazardous substances” under the Hazardous Materials Law (as defined herein). No underground tanks or underground deposits of Hazardous Materials exist on, under, in or about the Real Property.

3.18           Applicable Laws. To Company’s knowledge, Company has conducted the Business in compliance with all applicable federal, state and local laws, ordinances or regulations, now or previously in effect, relating to environmental conditions, industrial hygiene or Hazardous Materials on, under, in or about the Real Property including, without limitation, the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended, 42 U.S.C. Section 8601 et seq., the Resource Conservation and Recovery Act, 42 U.S.C. Section 6401 et seq., the Toxic Substances Control Act, 15 U.S.C. Sections 2601 through 2629, the Safe Drinking Water Act, 42 U.S.C. Sections 300f through 300j, and any similar State or local laws and ordinances and the regulations now or previously adopted, published and/or promulgated pursuant thereto (collectively, the “Hazardous Materials Laws”).

3.19           Patents, Licenses and Permits. The Principal Assets constitute all patents, licenses, permits, consents, approvals or authorizations of governments, governmental authorities or quasi-governmental authorities (both United States and foreign) currently owned or held by Company in connection with the Business (the “Patents, Licenses and Permits”), and, except as may be noted on Schedule 3.19, Company is the owner or exclusive licensee of each such Patent, License and Permit. No claims made by third parties with respect to any of the Patents, Licenses and Permits are pending. There are no decrees, licenses, sublicenses, agreements or limitations now in effect relating to any of the Patents, Licenses and Permits and there has been no notice to Company that any Patent, License or Permit infringes the rights of any third party or is being infringed by any third party.

3.20           Trademarks, Tradenames, etc. Company does not own or use any registered or unregistered copyrights, trademarks, tradenames, service marks, service names, slogans or assumed names (nor are any of the same used or held for use) in connection with the conduct of the Business other than those listed in Schedule 3.20 hereto (the “Trademarks”), all of which are owned by Company. No claims made by third parties with respect to any of the Trademarks are pending. There are no decrees, licenses, sublicenses, agreements or limitations now in effect relating to any of the Trademarks and there has been no notice to Company that any Trademark infringes the rights of any third party or is being infringed by any third party.

3.21           Books and Records, etc. Prior to the Closing Date, Company will make available to Parent copies of all books and records in Company’s possession relating to the Business and the Principal Assets, and on the Closing Date Company will deliver to Parent all such books and records in Company’s possession.

3.22           No Material Undisclosed Liabilities. Except as provided in the Company’s audited financial statements, or its unaudited financial statements for the nine months ended September 30, 2019, or in Schedule 3.22, Company at such date did not have, nor has it incurred since that date, any liabilities or obligations (whether absolute, accrued, contingent, fixed or otherwise, or whether due or to become due) of any nature that would be required by generally accepted accounting principles to be reflected on a consolidated balance sheet of the Company and its consolidated Subsidiaries (including the notes thereto), except liabilities or obligations (i) which were incurred in the ordinary course of business consistent with past practice or in connection with the Merger Transactions to which it is a party, (ii) which have not been, and could not be reasonably expected to be, individually or in the aggregate, materially adverse to the Company and its Subsidiaries taken as a whole, or other than (iii) obligations under the Patents, Licenses and Permits and (iv) liabilities and obligations that are in the aggregate less than $50,000.

3.23           Absence of Certain Events. To Company’s knowledge, and except as may be otherwise disclosed herein or by a written attachment hereto, no executive officer or director of Company has been within the past five (5) years, (i) a party to any bankruptcy petition against such person or against any business of which such person was affiliated; (ii) convicted in a criminal proceeding or subject to a pending criminal proceeding (excluding traffic violations and other minor offenses; (iii) subject to any order, judgment or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently or temporarily enjoining, barring, suspending or otherwise limiting their involvement in any type of business, securities or banking activities; or (iv) found by a court of competent jurisdiction in a civil action by the Securities and Exchange Commission or the Commodity Futures Trading Commission, to have violated a federal or state securities or commodities law and which judgment has not been reversed, suspended or vacated.

3.24           Tax Returns and Tax Liabilities. Except as set forth in Schedule 3.24, Company has (i) filed all tax returns required to be filed in any jurisdiction to which it is subject, (ii)   collected and timely paid over to the taxing authorities of each such jurisdiction all taxes required to be collected by Company from other persons, such as sales taxes, payroll taxes, etc., (iii)   either timely paid in full all taxes due to be paid by it and all taxes claimed to be due and payable from it by each such jurisdiction (except for any such taxes as are being contested in good faith by appropriate proceedings), and any interest, additions to tax and penalties with respect thereto, or provided adequate reserves for the payment thereof, (iv) fully accrued on its books all taxes, and any interest, additions to tax and penalties with respect thereto, for any period through the date hereof which are not yet due, including such as are being contested, and (v) the amount of any reserves and accruals in respect of taxes is at least equal to the net amount of all taxes and any interest, additions to tax, penalties and deficiency assessments, payable or which in the future become payable by Company with respect to all periods up to and including the date hereof.

3.25           Officers and Employees. Schedule 3.25 hereto contains a list of the names of each officer and each full-time employee of Company employed in the Business at the date hereof and such person’s position. Since September 30, 2019, except as set forth on Schedule 3.25, there has been no change of, or agreement to change, any terms of employment, including without limitation, salary, wage rates or other compensation, of any officer or employee of Company employed in the Business. The Company will use its commercially reasonable best efforts to induce all employees of Company employed in the Business to continue their respective employment following the Closing Date. For each employee hired by Company after January 1, 2019, Company has verified appropriate documents and has a verified and signed INS Form I-9 for each such employee, if required. All such forms are in Company’s possession and shall be turned over to Parent for each employee accepting employment with Parent as of the Closing. Company has not received any information that would lead it to believe that a material number of the employees of Company employed in the Business will or may cease to be employees of Company, or will refuse offers of employment from Parent, because of the consummation of the Merger Transactions to which it is a party.

3.26           Principal Assets Constitute the Business, etc. The Principal Assets comprise all of the assets, property, rights and business owned by and employed by Company in connection with the Business and will enable Company to operate the Business in substantially the same manner after the Closing as it is being conducted immediately before the Closing. All of the physical assets are serviceable for the purposes for which they are being used on the date hereof.

3.27           Material Information. To the knowledge of Company, neither the Schedules hereto nor this Agreement contains any untrue statement of a material fact or omit to state a material fact necessary to make information contained therein or herein not

misleading. To the knowledge of Company, there is no fact or condition which Company has not disclosed to Parent in writing which materially adversely affects the condition, financial or otherwise, of the Principal Assets or the Business or the prospects thereof or therefor, or the ability of Company to perform any of its obligations under this Agreement.

3.28           No Other Agreements to Sell Assets or Equity Interests. To the knowledge of Company and other than pursuant to or contemplated by this Agreement, the Company has no legal obligation, absolute or contingent, to any person or firm to sell the Business or the Principal Assets relating to the Business (other than sales in the ordinary course of Company’s business) or any equity interest therein, or to effect any merger, consolidation or other reorganization of the Company or to enter into any agreement with respect thereto.

Section 4. Representations and Warranties of Parent and Sub. Parent and Sub hereby jointly and severally represent and warrant to Company as follows:

4.1               Corporate Existence, Power and Authority. Each of Parent and Sub is a corporation duly organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation and has all requisite corporate power and authority to conduct its business as now being conducted, and to own, lease or otherwise hold its properties, to enter into this Agreement, and to carry out the Merger Transactions to which it is a party Parent and Sub each have the full corporate power and authority to enter into this Agreement and the documents to be delivered hereunder, to carry out their respective obligations hereunder and to consummate the transactions contemplated hereby.

4.2               Corporate Action. The execution and delivery of this Agreement by Parent and Sub and the consummation by Parent and Sub of the Merger Transactions have been authorized by all requisite corporate action on the part of Parent and Sub, and the documents to be delivered hereunder constitute legal, valid and binding obligations of Parent and Sub, enforceable against the Parent and Sub in accordance with their respective terms. The Parent represents and warrants that the approval of its shareholders is not required for Parent to enter into this Agreement and consummate the transaction contemplated herein.

4.3               Validity. This Agreement constitutes the legal, valid and binding obligation of each of Parent and Sub, enforceable in accordance with its terms except as enforcement may be limited by bankruptcy, reorganization, insolvency, moratorium or other similar laws presently or hereafter in effect affecting the enforcement of creditors’ rights generally and subject to general principles of equity.

4.4               Qualification as a Foreign Corporation. Each of Parent and Sub is duly qualified and in good standing as a foreign corporation and licensed to conduct its business as now being conducted in each jurisdiction in which Parent or Sub is required to be qualified to conduct its business, except where failure to be so qualified, in good standing and licensed would have no material and adverse impact on the ownership of its assets and properties or the conduct of Parent’s or Sub’s business as now conducted.

4.5                 Conflict with Other Instruments. Neither the execution and delivery of this Agreement by Parent or Sub nor the consummation by Parent or Sub of the Merger Transactions to which it is a party will (i) conflict with, or result in a breach of, the terms, conditions or provisions of, or constitute a default (or an event which with notice or lapse of time or both would become a default) under, or result in the creation of a lien or encumbrance on, or cause the triggering of a “due on sale” clause or similar restriction or provision affecting, any of its assets or properties pursuant to (A) the articles of incorporation or bylaws of Parent or Sub or (B) any material indenture, mortgage, lease, agreement or other instrument to which Parent or Sub is a party or by which it, or any of its assets or properties, may be bound or affected, or (ii) violate any provision of law, statute, rule or regulation to which Parent or Sub is subject or by which it or its properties are bound except where such violation would have no material and adverse impact on the ownership of its assets or properties or the conduct of Parent’s or Sub’s business as now conducted. No consent, approval, waiver or authorization is required to be obtained by Parent or Sub from any person or entity (including any governmental authority) in connection with the execution, delivery and performance by the Parent and Sub of this Agreement and the consummation of the transactions contemplated hereby.

4.6               Capitalization.

(a)     The authorized capital stock of Parent consists of 100,000,000 shares of common stock, no par value and 5,000,000 shares of preferred stock. As of September 30, 2019, 11,813,200 shares of Parent Common Stock and no shares of Parent Preferred Stock were issued and outstanding. Except as set forth on Schedule 4.6, there has been no change in the number of issued and outstanding shares of Parent Common Stock. All of the issued and outstanding shares of Parent Common Stock are, and all shares reserved for issuance will be, upon issuance in accordance with the terms specified in the instruments or agreements pursuant to which they are issuable, duly authorized, validly issued, fully paid and nonassessable. Except as set forth on Schedule 4.6, there is no outstanding subscription, contract, convertible or exchangeable security, option, warrant, call or other right obligating Parent to issue, sell, exchange, or otherwise dispose of, or to purchase, redeem or otherwise acquire, shares of, or securities convertible into or exchangeable for, capital stock of Parent. As of the Closing, Parent upon giving effect to the Merger shall have 78,754,666 shares of Parent Common Stock issued and outstanding (the “Merger Total”), of which 66,941,466 shares of Parent Common Stock shall be held by Company Shareholders on a fully diluted basis and 11,813,200 shares of Parent Common Stock shall be held by pre-Closing shareholders of Parent.

(b)               To Parent’s knowledge, there are no voting trusts, stockholder agreements or other voting arrangements that have been entered into among the stockholders of Parent.

(c)                The Parent Common Stock, upon issuance in accordance with the Merger as provided in this Agreement, will be duly authorized, validly issued, fully paid and nonassessable.

(d)               There are no outstanding contractual obligations of Parent or any Subsidiary of Parent to repurchase, redeem or otherwise acquire any shares of capital stock or any capital stock of any Subsidiary of Parent or to provide funds to, or make any investment (in the form of a loan, capital contribution or otherwise) in, any Subsidiary of Parent or any other person.

4.7               Parent’s Home Health Services Operations. Parent is in the business of home health services, primarily the selling and rental of durable medical equipment and selling medical supplies to the public, as well as to nursing homes, hospitals and other end users, with the majority of the Parent’s revenues received from Medicare, Medicaid and private insurance companies (the “Medical Supply Operations”). Concurrent with the Closing, Parent and Michael West (“MWest”) will enter into a Business Transfer and Indemnity Agreement (“Indemnity Agreement”) whereby Parent will deliver to MWest, Parent’s former Chief Executive Officer, all of the operations, assets and liabilities of Parent as of the Closing including the Medical Supply Operations (inclusive of equipment, vehicles, customer lists, contracts, accounts receivable and all other tangible and intangible assets, all liabilities and claims both actual and contingent, all inventories, accounts payable, accrued expenses, all outstanding bank debt, credit card and line of credit debt as well as the loan(s) from MWest to Parent, in exchange for MWest’s indemnities and agreements to hold Parent harmless, for a period of three years from the Closing Date, from all liabilities and claims arising from any liabilities, claims or obligations of the Company of any nature existing or accruing (i) from inception of the Parent until, but not after, June 28, 2019 which is the date on which MWest resigned as chief executive of the Company and thereafter the Medical Supply Operations, as more particularly set forth in the Indemnity Agreement, however, costs associated with the preparation of this Agreement and unexpended cash from private placement proceeds received in June 2019 are excluded from transfers contemplated under the Indemnity Agreement. As of the Closing there shall be no Liens on assets of the Parent or of its Subsidiaries.

4.8               Governmental Approvals. No authorization, consent or approval or other order or action of or filing or registration with any court, administrative agency, or other governmental or regulatory body or authority is required for the execution and delivery by Parent or Sub of this Agreement or Parent’s or Sub’s consummation of the Merger Transactions to which it is a party.

4.9               Litigation. Except as disclosed on Schedule 4.9, (i) there are no actions, suits, claims, arbitrations or proceedings pending or, to the knowledge of Parent, threatened against, relating to or affecting, nor to the knowledge of Parent are there any governmental or regulatory authority investigations or audits pending or threatened against, relating to or affecting, Parent or any of its Subsidiaries or any of their respective assets and properties which, individually or in the aggregate, could be reasonably expected to have a material adverse effect on Parent and its Subsidiaries taken as a whole or on the ability of Parent or Sub to consummate the Merger Transactions to which it is a party, and there are no facts or circumstances known to Parent that could be reasonably expected to give rise to any such action, suit, arbitration, proceeding, investigation or audit, and (ii) neither Parent nor any of its Subsidiaries is subject to any order of any governmental or regulatory authority which, individually or in the aggregate, is having or could be reasonably expected to have a material adverse effect on Parent and its Subsidiaries taken as a whole or on the ability of Parent or Sub to consummate the Merger Transactions to which it is a party. There is no action, suit, claim, investigation or proceeding known to Parent, after due inquiry, which is pending or threatened which questions the validity or propriety of this Agreement or any action taken or to be taken by Parent in connection with this Agreement. Parent is not subject to any judicial injunction or mandate or any quasi-judicial order or quasi-judicial restriction directed to or against it as a result of its ownership of the Parent’s assets of its conduct of the Parent’s business as now or heretofore conducted by it and no governmental agency has at any time challenged or questioned in writing, or commenced or given notice of intention to commence any investigation relating to, the legal right of Parent to conduct the its business or any part thereof as now or heretofore conducted by it, so as to

materially and adversely affect the ownership and use of the Parent’s assets.

4.10           Compliance with Laws, etc. Each of Parent and Sub has complied with all laws and regulations of any applicable jurisdiction with which it is required to comply, the enforcement of which could materially impair the ability of Parent or Sub to perform its obligations under this Agreement. The Parent and the Subsidiaries have complied with all laws and regulations of any applicable jurisdiction with which it is or was required to comply in connection with its ownership of the Parent’s Principal Assets and the Parent’s conduct of the Parent’s business, the enforcement of which would have a material and adverse effect on the ownership of the Parent’s assets or the conduct of the Parent’s business. Parent has all permits and permissions of governments, governmental authorities and quasi-governmental authorities necessary to own the Parent’s assets and to conduct its business as now conducted, except where failure to have such permits and permissions would have no material and adverse effect on the ownership of the Parent’s assets or the conduct of its business.

4.11           SEC Reports and Financial Statements. Parent has delivered to the Company prior to the execution of this Agreement by direction to the SEC’s EDGAR website a true and complete copy of each form, report, schedule, registration statement, definitive proxy statement and other document (together with all amendments thereof and supplements thereto) filed or to be filed by Parent or any of its Subsidiaries with the SEC since January 1, 2017 (as such documents have since the time of their filing been amended or supplemented, the “Parent SEC Reports”), which are all the documents (other than preliminary material) that Parent and its Subsidiaries were required to file with the SEC since such date. As of their respective dates, the Parent SEC Reports (i) complied as to form in all material respects with the requirements of the Securities Act or the Exchange Act, as the case may be, and (ii) did not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading. The audited consolidated financial statements and unaudited interim consolidated financial statements (including, in each case, the notes, if any, thereto) included in the Parent SEC Reports (the “Parent Financial Statements”) complied as to form in all material respects with the published rules and regulations of the SEC with respect thereto, were prepared in accordance with generally accepted accounting principles applied on a consistent basis during the periods involved (except as may be indicated therein or in the notes thereto and except with respect to unaudited statements as permitted by Form 10-Q of the SEC) and fairly present (subject, in the case of the unaudited interim financial statements, to normal, recurring year-end audit adjustments which are not expected to be, individually or in the aggregate, materially adverse to Parent and its Subsidiaries taken as a whole) the consolidated financial position of Parent and its consolidated Subsidiaries as at the respective dates thereof and the consolidated results of their operations and cash flows for the respective periods then ended. Each Subsidiary of Parent is treated as a consolidated Subsidiary of Parent in the Parent Financial Statements for all periods covered thereby. To the knowledge of the Parent , other than as set forth in Schedule 4.11   there are no material liabilities or obligations, either fixed or contingent, not disclosed or referenced in the Parent Financial Statements or in any exhibit or notes thereto other than contracts or obligations occurring in the ordinary course of business since September 30, 2019; and no such contracts or obligations occurring in the ordinary course of business constitute liens or other liabilities which materially alter the financial condition of Company as reflected in the Parent Financial Statements. Parent has, or will have at the Closing, good title to all assets, properties or contracts shown on the Parent Financial Statements subject only to dispositions and other transactions in the ordinary course of business, the disclosures set forth herein and therein and liens and encumbrances of record disclosed therein.

4.12           Absence of Certain Changes or Events. Except as disclosed in the Schedule 4.12 (a) since September 30, 2019, (i) there has been no material adverse change in the condition, financial or otherwise, of the business the Parent or its assets or properties, or in the prospects thereof or therefor; (ii) since September 30, 2019 none of its assets or properties or the Parent has been adversely affected in any material way by, or sustained any material loss, whether or not insured, as a result of any fire, flood, accident, explosion, strike, labor disturbance, riot, act of God or the public enemy or other calamity or casualty. To the knowledge of Parent, except as previously disclosed to Company in writing pursuant to this Agreement and since September 30, 2019, Parent (i) has not become involved in any unresolved labor trouble or dispute which materially and adversely affects the Parent’s (ii) has not become a party to any collective bargaining agreement, and (iii) has not suffered any liability, judgment, lien or termination of contract or the imposition of any obligation, the effect of which shall be materially adverse to the Parent’s business or its assets or properties; (iii) there has not been any change, event or development having, or that could be reasonably expected to have, individually or in the aggregate, a material adverse effect on Parent and its Subsidiaries taken as a whole, other than those occurring as a result of general economic or financial conditions or other developments which are not unique to Parent and its Subsidiaries but also generally affect other persons who participate or are engaged in the lines of business in which Parent and its Subsidiaries participate or are engaged and (iv) between such date and the date hereof Parent and its Subsidiaries have conducted their respective businesses only in the ordinary course consistent with past practice or as contemplated in connection with this Agreement. Without limiting the generality of the foregoing, since September 30, 2019, Parent and Subsidiaries have operated their respective businesses in the ordinary course of business in all material respects and there has not been, with respect to the businesses, and other than in the ordinary course of business any:

(j)                 event, occurrence or development that has had a Material Adverse Effect;

(k)               incurrence of any indebtedness for borrowed money in connection with the Business in an aggregate amount exceeding $25,000, except unsecured current obligations and liabilities incurred in the ordinary course of business;

(l)                 sale or other disposition of any of the assets shown or reflected in the balance sheet of the Parent;

(m)             cancellation of any debts or claims or amendment, termination or waiver of any rights of the Parent or Subsidiaries, except in the ordinary course of business;

(n)               imposition of any encumbrance upon any of assets of the Parent or the Subsidiaries;

(o)               material increase in the compensation of any employees, other than as provided for in any written agreements or in the ordinary course of business;

(p)               adoption, termination, amendment or modification of any employee benefit plan;

(q)               adoption of any plan of merger, consolidation, reorganization, liquidation or dissolution or filing of a petition in bankruptcy under any provisions of federal or state bankruptcy law or consent to the filing of any bankruptcy petition against it under any similar law; or

(r)                 any agreement to do any of the foregoing, or any action or omission that would result in any of the foregoing.

4.13           Absence of Undisclosed Liabilities. Except for matters reflected or reserved against in the balance sheet (unaudited) for the period ended September 30, 2019 or as disclosed in Schedule 4.13, neither Parent nor any of its Subsidiaries had at such date, or has incurred since that date, any liabilities or obligations (whether absolute, accrued, contingent, fixed or otherwise, or whether due or to become due) of any nature that would be required by generally accepted accounting principles to be reflected on a consolidated balance sheet of Parent and its consolidated Subsidiaries (including the notes thereto), except liabilities or obligations (i) which were incurred in the ordinary course of business consistent with past practice or in connection with the Merger Transactions to which it is a party and (ii) which have not been, and could not be reasonably expected to be, individually or in the aggregate, materially adverse to Parent and its Subsidiaries taken as a whole. As of the Merger the Parent shall not have any liabilities any liabilities or obligations (whether absolute, accrued, contingent, fixed or otherwise, or whether due or to become due) of any nature other than $50,000 that are primarily related to legal expenses, transfer agent and accounting fees and which are set forth on Schedule 8.6.

4.14           Tax Returns and Tax Liabilities. Except as set forth in Schedule 4.14, each of Parent and Sub has (i) filed all tax returns required to be filed in any jurisdiction to which it is subject, (ii) collected and paid over to the taxing authorities of each such jurisdiction all taxes required to be collected by Parent from other persons, such as sales taxes, payroll taxes, etc., (iii) either paid in full all taxes due to be paid by it and all taxes claimed to be due and payable from it by each such jurisdiction (except for any such taxes as are being contested in good faith by appropriate proceedings), and any interest, additions to tax and penalties with respect thereto, or provided adequate reserves for the payment thereof, (iv) fully accrued on its books all taxes, and any interest, additions to tax and penalties with respect thereto, for any period through the date hereof which are not yet due, including such as are being contested, and (v)   the amount of any reserves and accruals in respect of taxes is at least equal to the net amount of all taxes and any interest, additions to tax, penalties and deficiency assessments, payable or which in the future become payable by Parent or Sub with respect to all periods up to and including the date hereof. Neither Parent nor Sub is a "foreign person" as that term is used in Treasury Regulations Section 1.1445-2.

4.15           Hazardous Waste. To Parent’s knowledge, neither Parent or Sub nor any previous owner, tenant, occupant or user of any real property owned, leased or occupied by Parent or Sub used, generated, manufactured, treated, handled, refined, processed, released, discharged, stored or disposed of any Hazardous Materials on, under, in or about such real property, or transported any Hazardous Materials to or from such real property. No underground tanks or underground deposits of Hazardous Materials exist on, under, in or about such real property.

To Parent’s knowledge, each of Parent and Sub has kept and maintained any real property owned, leased or occupied by Parent or Sub, including the groundwater on or under such real property, and conducted its business in compliance with all applicable federal, state and local laws, ordinances or regulations, now or previously in effect, relating to environmental conditions, industrial hygiene or Hazardous Materials on, under, in or about such real property including, without limitation, the Hazardous Materials Laws.

As of the date hereof, there are no Hazardous Materials Claims nor has there been any occurrence or condition on any real property owned, leased or occupied by Parent or Sub or adjoining or in the vicinity of such real property which could subject Company, Parent or Sub or such real property to any restrictions on ownership, occupancy, transferability or use of the Real Property under any Hazardous Material Laws.

4.16       No Broker, finder or investment banker is entitled to any brokerage, finder's or other fee or commission in connection with the transactions contemplated by this Agreement based upon arrangements made by or on behalf of Parent or Subsidiary.

4.17         Assets; Title to Assets. The assets or properties of Parent consist principally of tangible and intangible assets, including know how and other intellectual property (the “Intellectual Property”), all as further described on Schedule 4.17 (the “Parent’s Principal Assets”). Parent has good and marketable title to the Parent’s Principal Assets, free and clear of all mortgages, liens, claims, or encumbrances of any kind or any conditional sale agreement or other title retention.

4.18         Material Contracts. Parent has furnished or made available to Company accurate and complete copies or detailed descriptions of Parent Material Contracts (as defined below) applicable to Parent and its Subsidiaries including the Intellectual Property. With respect to any Parent Material Contract, Parent is not aware of any existing breach, default or event of default by Parent or event that with notice or lapse of time or both would constitute a breach, default or event of default by Parent, other than breaches, defaults or events of default that would not have a material adverse effect on the business, assets or prospects of Parent (a “Parent Material Adverse Effect”), nor does Parent know of, and Parent has not received notice of, or made a claim with respect to, any breach or default by any other party thereto that would, severally or in the aggregate, have a Parent Material Adverse Effect. As used herein, the term “Parent Material Contracts” shall mean all (i) employee benefit plans, share option schemes or agreements and employment, consulting or similar contracts, (ii) contracts that involve remaining aggregate payments by Parent in excess of $50,000 or which have a remaining term in excess of two years, (iii) insurance policies, and (iv) all contracts that would, if terminated, have a Parent Material Adverse Effect.

4.19           ERISA. (i) Parent or its Subsidiaries have never sponsored, maintained or contributed to any employee pension benefit plan, within the meaning of Section 3(2) of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”); (ii) is not required to contribute to, nor has ever been required to contribute to, any multi-employer plan within the meaning of Section 3(37)(A) of ERISA; (iii) does not sponsor or contribute to any employee welfare benefit plan within the meaning of Section 3(1) of ERISA, nor has it entered into any pay arrangements, plans or programs that are ERISA Plans; or (iv) have an ERISA or non- ERISA Plan that provides benefits, including, without limitation, death, health or medical benefits (whether or not insured), with respect to current or former employees beyond their retirement or other termination of service other than coverage mandated by applicable law, deferred compensation benefits accrued as liabilities on financial statements, or benefits, the full cost of which are borne by the current or former employee or his beneficiary. The consummation of the transactions contemplated by this Agreement will not entitle any current or former employee or officer of Parent to severance pay, unemployment compensation or any other payment, accelerate the time of payment or vesting, or increase the amount of compensation or benefits due any such employee or officer.

4.20           Employee Plans. Neither Parent nor any predecessor or subsidiary thereof has or maintains any employee benefit, bonus, incentive compensation, profit-sharing, equity, stock bonus, stock appreciation rights, restricted stock, other stock-based incentive, executive compensation agreement, employment agreement, deferred compensation, pension, stock purchase, employee stock ownership, savings, pension, retirement, supplemental retirement, employment related change-in-control, severance, salary continuation, layoff, welfare (including, without limitation, health, medical, prescription, dental, disability, salary continuation, life, accidental death, travel accident, and other insurance), vacation, holiday, sick leave, fringe benefit, or other benefit plan, program, or policy, whether qualified or nonqualified and any trust, escrow, or other agreement related thereto, covering any present or former employees, directors, or their respective dependents. Parent has granted its interim CEO, two of its outside directors and an outside service provider options to acquire an aggregate of 300,000 shares of common stock as described within Form 8-K-Current Report of Parent SEC Reports, filed with the SEC on December 3, 2019.

4.21           Certain Payments. To Parent’s knowledge, neither Parent, Parent’s Subsidiaries nor any of their respective officers, employees or agents, nor any other person acting on behalf of Parent or Subsidiary has directly or indirectly, within the past five (5) years, given or agreed to give any gift or similar benefit to any person who is, or may be in a position to help or hinder Parent’s business, or assist it in connection with any actual or proposed transaction, which (i) might be reasonably expected to subject it to any material damage or penalty in any action or to have a Parent Material Adverse Effect on Company or its business, assets, properties, financial condition or results of operations (a “ Parent Material Adverse

Effect”), (ii) if not given in the past, might have reasonably been expected to have had a Parent Material Adverse Effect, or (iii) if not continued in the future, might be reasonably expected to have a Parent Material Adverse Effect or to subject Parent or its Subsidiaries to material suit or penalty in any action.

4.22           No Material Undisclosed Liabilities. Except as provided in the Parent’s audited financial statements, or its unaudited financial statements for the nine months ended September 30, 2019, or in Schedule 4.22, there are to the knowledge of the Parent no liabilities or obligations of Parent of any nature, whether absolute, accrued, contingent, or otherwise, other than (a) obligations under the Patents, Licenses and Permits and (b) liabilities and obligations that are in the aggregate less than $50,000. criminal proceeding or subject to a pending criminal proceeding (excluding traffic violations and other minor offenses; (iii) subject to any order, judgment or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently or temporarily enjoining, barring, suspending or otherwise limiting their involvement in any type of business, securities or banking activities; or (iv) found by a court of competent jurisdiction in a civil action by the Securities and Exchange Commission or the Commodity Futures Trading Commission, to have violated a federal or state securities or commodities law and which judgment has not been reversed, suspended or vacated.

4.23           Applicable Laws. Parent and Subsidiaries they have conducted their business in compliance with all applicable federal, state and local laws, ordinances or regulations, now or previously in effect, relating to environmental conditions, industrial hygiene or Hazardous Materials on, under, in or about the Real Property including, without limitation, the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended, 42 U.S.C. Section 8601 et seq., the Resource Conservation and Recovery Act, 42 U.S.C. Section 6401 et seq., the Toxic Substances Control Act, 15 U.S.C. Sections 2601 through 2629, the Safe Drinking Water Act, 42 U.S.C. Sections 300f through 300j, and any similar State or local laws and ordinances and the regulations now or previously adopted, published and/or promulgated pursuant thereto (collectively, the “Hazardous Materials Laws”).

4.24           Patents, Licenses and Permits. The Parent’s Principal Assets constitute all patents, licenses, permits, consents, approvals or authorizations of governments, governmental authorities or quasi-governmental authorities (both United States and foreign) currently owned or held by Parent in connection with the Parent’s business (the “Parent’s Patents, Licenses and Permits”), and, Parent is the owner or exclusive licensee of each such Parent’s Patent, License and Permit. No claims made by third parties with respect to any of the Parent’s Patents, Licenses and Permits are pending.

4.25           Trademarks, Tradenames, etc. Parent does not own or use any registered or unregistered copyrights, trademarks, tradenames, service marks, service names, slogans or assumed names (nor are any of the same used or held for use) in connection with the conduct of the Parent’s business other than those listed in Schedule 4.25 hereto (the “Parent’s Trademarks”), all of which are owned or under license by Parent. No claims made by third parties with respect to any of the Parent’s Trademarks are pending.

4.26           Books and Records, etc. Prior to the Closing Date, Parent will make available to Parent copies of all books and records in Company’s possession relating to the Parent’s business and the Parent’s Principal Assets, and on the Closing Date Company will deliver to Parent all such books and records in Company’s possession.

4.27           Officers and Employees. Schedule 4.27 hereto contains a list of the names of each officer and each full-time employee of Parent employed by Parent and the Subsidiaries at the date hereof and such person’s position. Since September 30, 2019, there has been no change of, or agreement to change, any terms of employment, including without limitation, salary, wage rates or other compensation, of any officer or employee of Parent employed in the Parent’s business. Immediately prior to the Closing, each of the employees shall no longer be an employee of the Company but may continue to remain an employee of the entity succeeding to the Medical Supply Operations .

4.28           Principal Assets Constitute the Business, etc. The Parent’s Principal Assets comprise all of the assets, property, rights and business owned by and employed by Parent in the Parent’s business.

4.29           Material Information. To the knowledge of Parent, neither the Schedules hereto nor this Agreement contains any untrue statement of a material fact or omit to state a material fact necessary to make information contained therein or herein not misleading. To the knowledge of Parent, there is no fact or condition which Parent has not disclosed to Company in writing which materially adversely affects the ability of Parent to perform any of its obligations under this Agreement.

4.30           No Other Agreements to Sell Assets or Equity Interests. To the knowledge of Parent and other than pursuant to or contemplated by this Agreement and the Indemnification and Assignment Agreement, the Parent has no legal obligation, absolute or contingent, to any person or firm to sell the Business or the Parent’s Principal Assets relating to the Parent’s Business (other than sales in the ordinary course of Parent’s business) or any equity interest therein, or to effect any merger, consolidation or other reorganization of the Parent or to enter into any agreement with respect thereto.

4.31       Active Business Operations. Immediately prior to and as of the Closing of the Merger Parent will remain a corporation with active business operations and significant assets and will not be a shell company as defined in Rule 405 under the Securities Act.

Section 5. Conditions Precedent to Obligations of Parent and Sub. All obligations of Parent and Sub under this Agreement to be performed on and after the Closing Date are, at the option of Parent, subject to the satisfaction of the following conditions precedent at the Closing, as indicated below.

5.1               Proceedings Satisfactory. All actions, proceedings, instruments, opinions and documents required to carry out this Agreement or incidental hereto, and all other related legal matters, shall be reasonably satisfactory to Parent and to counsel for Parent. Company shall have delivered to Parent on the Closing Date such documents and other evidence as Parent may reasonably request in order to establish the consummation of the Merger Transactions to which it is a party, the taking of all corporate and other proceedings in connection therewith and the compliance with the conditions set forth in this Section 5, in form and substance reasonably satisfactory to Parent.

5.2               Shareholder Approval. This Agreement shall have been adopted by the requisite vote of the shareholders of Company under the Nevada Statutes and Company’s Articles of Incorporation, if required under the Nevada Statutes.

5.3               Representations and Warranties of Company Correct. The representations and warranties made by Company in Section 3 shall be (and tender by Company of any documents required to be delivered at the Closing by it shall constitute a representation by Company as at the Closing that, except as otherwise specifically approved in writing by Parent, such representations and warranties of Company are) true and correct in all material respects on and as of the Closing Date with the same force and effect as though all such representations and warranties had been made on and as of the Closing Date after giving effect to any transactions or other actions contemplated hereby.

5.4               Compliance with Terms and Conditions. All the terms, covenants, agreements and conditions of this Agreement to be complied with and performed by Company on or before the Closing Date shall have been (and tender by Company of any documents required to be delivered at the Closing shall constitute a representation by Company as at the Closing that, except as otherwise specifically approved in writing by Parent, they have been) complied with and performed in all material respects.

5.5               No Proceedings Pending. No action, suit, claim, investigation or proceeding by or before any court, administrative agency or other governmental or regulatory body or authority shall have been instituted or threatened which may restrain, prohibit or invalidate any of the Merger Transactions to which it is a party or which may affect the right of Company to operate or control after the Closing Date the Principal Assets or the Business, or any part thereof.

5.6               No Material Change. There shall have been no material adverse change in the condition, financial or otherwise, of Company or the Principal Assets, or in the prospects thereof or therefor, and none of Company or the Principal Assets shall have been, in the judgment of Parent, adversely affected in any material way by, or sustained any material loss, whether or not insured, as a result of, any fire, flood, accident, explosion, strike, labor disturbance, riot, act of God or the public enemy or other calamity or casualty. Company shall not (i) be involved in any unresolved labor trouble or dispute which materially and adversely affects the business or prospects of Company; (ii) have become a party to any collective bargaining agreement; or (iii) have suffered any liability, judgment, lien or termination of contract or the imposition of any obligation, the effect of which shall, in the judgment of Parent, be materially adverse to Company, the Principal Assets of the prospects of either.

5.7               Certificates. Company shall have delivered to Parent (i) a copy of the articles of incorporation, as amended, of Company, certified as of a recent date by the Secretary of State of Company’s jurisdiction of incorporation, and a long-form certificate as to the good standing of Company from such official, in each case dated as of a recent date; (ii) a certificate as to the good standing of Company as a foreign corporation qualified to do business in Florida and a tax certificate of good standing from the Secretary of State of Nevada dated as of a recent date; (iii) a certificate of the Secretary of Company dated the Closing Date and certifying (A) that attached thereto is a true, correct and complete copy of the by-laws of Company as in effect on the date of such certificate and at all times since a date prior to the date of the resolutions of Company described in item (B) below, (B) that attached thereto is a true, correct and complete copy of the resolutions adopted by the Board of Directors of Company authorizing the execution, delivery and performance of this Agreement and all other documents delivered by Company in connection herewith and the consummation by Company of the Merger Transactions to which it is a party and such other documents, and that such resolutions have not been modified, rescinded or amended and are in full force and effect, (C) that the certificate or articles of incorporation of Company has not been amended since the date of the last amendment thereto shown on the certificate of good standing furnished pursuant to (i) above and no action has been taken by Company or its shareholders, directors or officers in contemplation of the filing of any such amendment or in contemplation of the liquidation or dissolution of Company, and (D) as to the incumbency and specimen signature of each officer of Company executing this Agreement or any other document delivered in connection herewith; (iv) a certificate of another officer of Company dated the Closing Date as to the incumbency and signature of the Secretary of Company; (v) a certificate of the Chairman of the Board of Directors, President or a Vice President of Company and its chief financial officer or chief accounting officer stating that the representations and warranties of Company in Section 3 hereof are true and correct as of the Closing Date with the same force and effect as if made on and as of the Closing Date and Company has complied with all the terms and provisions contained in this Agreement or in the other documents delivered in connection herewith on its part to be observed or performed; and (vi) Such other documents as Parent may reasonably request.

5.8               Arrangements as to Employees. Company shall have paid or properly accrued for all amounts of salary, wages and vacation pay due to all employees of Company through the close of business on the Closing Date and shall have remitted or set aside for remittance to the appropriate authority all withholding, social security and other employer and employee taxes due or to become due in respect of the operation of Company’s business through such date.

5.9               Cash or Cash Equivalents. Since June 1, 2019 and as of the time of Closing, Company shall have raised from the aggregate sale of its equity securities not less than $1,500,000 which is available or was utilized for inventory purchases, reductions to accounts payable and for other general working capital purposes and as of the Closing the Company’s total long term and short term debt will not exceed $500,000 (the “Company’s Permitted Closing Debt”). Except as may be set forth in Schedule 5.9, Company represents and warrants that (i) the maturity date of each note comprising Company’s Permitted Closing Debt is not earlier than August 2020 and that (ii) the Company is not in default or breach of any term or provision of any note, instrument or other agreement comprising or relating to the Company’s Permitted Closing Debt.

5.10                 Indemnification and Assignment. Michael West shall have entered into the Indemnification Agreement substantially in the form attached hereto exhibit A.

5.11                 Company Note Conversion and Preferred Stock Conversion Agreements. The Company shall have entered into Note Conversion Agreements with all holders of its debt other than holders of the Company’s Permitted Closing Debt, and Preferred Stock Conversion Agreements with all holders of Preferred Stock, substantially in the form attached hereto as Exhibits B and C respectively.

5.12               Lock-up/Leak out Agreements. The Company shall have entered into the into Lock-up/Leak out agreements described in paragraph 8.12 below, substantially in the form attached hereto as Exhibit D,

Section 6. Conditions Precedent to Obligations of Company. All obligations of Company hereunder to be performed on or after the Closing Date are, at the option of Company, subject to the satisfaction of the following conditions precedent at the Closing, as indicated below.

6.1               Proceedings Satisfactory. All actions, proceedings, instruments, opinions and documents required to carry out this Agreement or incidental hereto and all other related legal matters (including the assumption of Parent’s liabilities) shall be reasonably satisfactory to Company and to counsel for Company. Parent shall have delivered to Company on the Closing Date such documents and other evidence as Company may reasonably request in order to establish the consummation of the Merger Transactions to which it is a party, the taking of all corporate and other proceedings in connection therewith and the compliance with the conditions set forth in this Section 6, in form and substance reasonably satisfactory to Company.

6.2               Shareholder Approval. This Agreement shall have been adopted by the requisite vote of the shareholders of the Sub as may be required under applicable law.

6.3               Representations and Warranties of Parent and Sub Correct. The representations and warranties made by Parent and Sub in Section 4 of this Agreement shall be (and tender by Parent or Sub of any documents required to be delivered at the Closing by it shall constitute a representation by Parent and Sub at the Closing that, except as otherwise specifically approved in writing by Company, such representations and warranties of Parent and Sub are) true and correct in all material respects on and as of the Closing Date with the same force and effect as though all such representations and warranties had been made on and as of the Closing Date after giving effect to any transactions or other actions contemplated hereby.

6.4               Compliance with Terms and Conditions. All the terms, covenants and conditions of this Agreement to be complied with and performed by Parent or Sub on or before the Closing Date shall have been (and tender by Parent or Sub of any documents required to be delivered at the Closing by it shall constitute a representation by Parent and Sub as at the Closing that, except as otherwise specifically approved in writing by Company, they have been) complied with and performed in all material respects.

6.5               Certificates. Parent shall have delivered to Company (i) a copy of the articles of incorporation, as amended, of each of Parent and Sub, certified as of a recent date by the Secretary of State of the jurisdiction of its incorporation; (ii) a certificate of the Secretary of Parent dated the Closing Date and certifying (A) that attached thereto is a true, correct and complete copy of the by-laws of each of Parent and Sub as in effect on the date of such certificate and at all times since a date prior to the date of the resolutions of Parent and Sub described in item (B) below, (B) that attached thereto is a true, correct and complete copy of the resolutions adopted by the Board of Directors of each of Parent and Sub authorizing the execution, delivery and performance of this Agreement and all other documents delivered by Parent and Sub in connection herewith and the consummation by Parent and Sub of the Merger Transactions to which it is a party and such other documents, and that such resolutions have not been modified, rescinded or amended and are in full force and effect, (C) that the articles of incorporation of Parent and Sub have not been amended since the date of the last amendment thereto furnished pursuant to (i) above and no action has been taken by Parent or Sub or its respective shareholders, directors or officers in contemplation of the filing of any such amendment or in contemplation of the liquidation or dissolution of Parent or Sub, and (D) as to the incumbency and specimen signature of each officer of Parent and Sub executing this Agreement or any other document delivered in connection herewith; (iii) a certificate of another officer of Parent dated the Closing Date as to the incumbency and signature of the Secretary of Parent and Sub; (iv) a certificate of the Chairman of the Board of Directors, President or a Vice President of Parent stating that the representations and warranties of Parent and Sub in Section 4 hereof are true and correct as of the Closing Date with the same force and effect as if made on and as of the Closing Date and each of Parent and Sub has complied with all the terms and provisions contained in this Agreement or in the other documents delivered in connection herewith on its part to be observed or performed; and (v) such other documents as Company may reasonably request.

6.6               Capitalization Assumptions. As set forth and based on the assumptions set forth in Schedule 6.6, including (i) any other adjustments contemplated in this Agreement and (ii) completion of the Closing, Company Shareholders shall own beneficially not less than the percentage of the Parent’s issued and outstanding shares of common stock as set forth in Schedule 6.6.

6.7             Elimination of Liabilities. Except as contemplated within Section 4.13 or as set forth on Schedule 6.7, Parent shall have eliminated and discharged all obligations and liabilities of Parent and Sub as required under Section 8.6, including, without limitation, the material obligations and liabilities of the Medical Supply Operations as recited within the Indemnity Agreement which the parties shall enter concurrently with the date of this Agreement.

6.8               Parent and Officer Director Resignations. Each of the Parent Directors and officers of Parent shall have (i) resigned as a director of Parent and (ii) tendered his or her resignation as an officer of Parent, and the replacement Parent Directors and officers designated by the Company shall have been appointed.

6.9               OTCQB. Parent’s common stock shall be listed for trading on the OTCBQ and the Company shall be current in its filings with the Securities and Exchange Commission.

6.10           DWAC and DTC. The Parent shall have used its reasonable commercial efforts to be DWAC and DTC eligible

6.11           Reserved.

6.12           Appointment of Officers. Robert Nistico shall be appointed Chief Executive Officer and President of Parent and of the Surviving Corporation and Dean Huge shall be appointed the Chief Financial Officer of Parent and of the Surviving Corporation.

6.13           Appointment of Directors. The following persons or such other individuals as the Parent and the Company may appoint prior to the closing shall be appointed to the be directors of the Parent: Robert Nistico, Justin York and Peter McDonough. Robert Nistico shall be appointed to the board of the Surviving Corporation.

6.14           Indemnification and Assignment. Michael West shall have entered into the Indemnification Agreement in the form of exhibit A.

6.15           Shareholder Approval. The shareholder of the Subsidiary shall have approved the execution of this Agreement and the transactions contemplated by this Agreement.

Section 7. Additional Covenants of Company.

7.1             Consents. The Company covenants to Parent and Sub that it will use its commercially reasonable efforts to obtain or cause to be obtained from any required parties any consents, approvals, authorizations or waivers required hereunder in connection with the Merger.

7.2             Cooperation. The Company covenants to Parent and Sub that, from the date hereof to and including the Closing Date, it will:

(a)                Access to Information. Cooperate and cause others under the control of Company to cooperate to the end of providing Parent and its counsel, accountants and other designated representatives full access during normal business hours to the properties, books, contracts, commitments and other records (including computer files, retrieval programs and related documentation) of Company relating to the Principal Assets or the Business, and Company will furnish or cause to be furnished to Parent and such representatives during such period all such information and data concerning the same as Parent or such representatives reasonably may request. Parent may, from the date hereof to the Closing Date, contact vendors, customers and manufacturers and others with whom Company does business in connection with the Business; and

(b)             Keep Parent Informed. Promptly notify Parent of any material matter or thing occurring which adversely affects the condition, financial or otherwise, of the Principal Assets or the Business, or the prospects thereof or therefor.

7.3             Preserve the Business. The Company covenants to Parent and Sub that, from the date hereof to and including the Closing Date:

(a)     The Company will do or cause to be done all things necessary and appropriate to (A) continue operation of the Business in the ordinary course in the same manner in which it has heretofore been conducted; (B) preserve intact the business organization and reputation of the Company; (C) continue and maintain in force any insurance; (D) except as otherwise contemplated herein, use its best efforts to keep available the services of the management and employees of the Company; and (E) preserve the goodwill of suppliers, customers and others having business relations with the Company; and

     (b)         Reserved 

7.4               Ordinary Course. The Company covenants to Parent and Sub that, notwithstanding Section 7.3, at all times from and after the date hereof until the Closing Date, it covenants and agrees as to itself and its Subsidiaries that (except as expressly contemplated or permitted by this Agreement, or to the extent that Parent shall otherwise consent in writing) Company and each of its Subsidiaries shall conduct its businesses only in, and none of Company and such Subsidiaries shall take any action except in, the ordinary course consistent with past practice.

7.5               Conversion of Company’s Outstanding Debt and of Outstanding Preferred Stock . On or prior to the Closing all indebtedness and loan obligations of the Company, other than Permitted Closing Debt, shall be converted into equity of the Company at a rate of $1.00 per share and upon such other terms as may be reasonably acceptable to Parent and principal shareholders of Parent provided that Permitted Closing Debt will be converted within 60 days of the Closing, and provided further that all conversions of Company debt outstanding at Closing into shares of common stock and all conversions of the Company’s Preferred Stock into shares of common stock are subject to being rescinded, pursuant to the terms of Note Conversion Agreements and Preferred Stock Conversion Agreements, forms of which agreements are attached hereto as Exhibits B and C respectively, if Parent raises less than $9 million of equity capital (the “Supplemental Capital”) within six months from the Closing Date (the “Supplemental Raise Date”).

7.6       If Parent raises the Supplemental Capital on or before Supplemental Raise Date, Company Shareholders shall be entitled to receive additional shares amounting to 1.25% of Parent Common Stock (the “Supplemental Capital Shares”) based on 78,754,666 shares outstanding and within seven days of the date of the Supplemental Raise Date the Company shall issue or cause its transfer agent to issue the Supplemental Capital Shares to the Company Shareholders in accordance with their pro rata shareholdings. On a fully diluted basis after giving effect to the New Capital, Company Shareholders shall own 86.25% of Parent Common Stock in the aggregate and pre-Closing shareholders of Parent shall own 13.75% of Parent Common Stock in the aggregate. If Parent has not raised the Supplemental Capital as of the Supplemental Raise Date or if it has not complied with the covenant contained in paragraph 8.11 below during the period ending as of the Supplemental Raise Date then the right to receive the Supplemental Capital Shares shall terminate and, be of no further effect.

Section 8. Additional Post Closing and Other Covenants by Parent and Sub.

8.1               Consents and Waivers. Each of Parent and Sub will obtain from any required parties any consents, approvals, authorizations or waivers required hereunder in connection with the Merger. Schedule 8.1 sets forth all required party consents approvals authorizations or waivers required hereunder in connection with the Merger (collectively “Parent Approvals”) and other than as set forth on Schedule 8.1 no Parent Approvals are required with respect to the entering into and execution of this Agreement and consummating the transactions contemplated by this Agreement including the Merger.

8.2               Books and Records. After the date hereof, Parent and Sub shall permit Company and its authorized representatives, in connection with (i) the preparation of Company’s tax returns, (ii) the determination or enforcement of the Company’s rights and obligations under this Agreement, (iii) the Company’s compliance with the requirements of any governmental or quasi-governmental authority or body or (iv) to have reasonable access during normal business hours to the Books and Records relating to the operation of the Business prior to the Closing Date. Notwithstanding the foregoing, copies of the Books and Records of the Parent and Sub shall remain with the Company. After the Closing Michael West shall be reasonably available (without additional consideration) to cooperate with the providing any inflation about the Parent that the Company may need to meet its reporting obligations in connection with the audit of the Parent for the year ended December 31, 2019.

8.3               Related Transactions. As soon as practicable prior to the Closing (but not less than 20 days before the closing), as applicable, the Parent shall prepare and file with the SEC any statement if required pursuant to Rule 14f-1 promulgated under the Exchange Act, and send the statement to all Parent shareholders immediately after the Closing. Parent and Company shall use their respective best efforts to obtain effectiveness of any such statement should any comments arise from the SEC.

8.4               Announcing Report. Contemporaneous with or prior to the earlier of (i) Parent’s first public announcement of the transactions contemplated hereby and (ii) 5:30 p.m. (New York City time) on the fourth (4th) business day following the Closing Date, Parent shall file a Form 8-K with the SEC describing the terms of the transactions contemplated by this Agreement in the form required by the Exchange Act, including any required financial statements (the “Announcing Form 8-K”). Parent shall not make any public announcement regarding the transactions contemplated hereby prior to the Closing, unless otherwise required by the rules and regulations of the SEC or other authority.

8.5               Ordinary Course. At all times from and after the date hereof until the Closing Date, Parent covenants and agrees as to itself and its Subsidiaries that (except as expressly contemplated or permitted by this Agreement, or to the extent that Company shall otherwise consent in writing) Parent and each of its Subsidiaries shall conduct its businesses only in, and none of Parent and such Subsidiaries shall take any action except in, the ordinary course consistent with past practice.

8.6               Elimination of Liabilities. Parent shall cause the cumulative obligations, liabilities debt of Parent and Sub relating to and incurred in directly or indirectly in connection with the Parent’s business including but not limited to the Medical Supply Operations immediately prior to the Effective Time to consist principally of liabilities for legal expenses, transfer agent fees, EDGAR filing agent fees, and accounting fees and which are set forth on Schedule 8.6 and which fees and costs shall not to exceed $50,000. Immediately prior to the Closing, Parent shall cause all other obligations and liabilities of Parent and Sub to be satisfied or released (together with appropriate releases or indemnities in favor of Parent and Sub), in form and substance satisfactory to Company and its counsel.

8.7               Post-Closing Equity Plan. Following the Closing, Parent may adopt a stock equity plan (the “Equity Plan”) containing such terms and provisions as Parent’s board of directors may deem to be in the best interests of Parent. The Equity Plan shall be for the benefit of employees, directors and consultants of Parent and the Company, provided that grants under the Equity Plan shall not in the aggregate exceed ten percent (10%), with allowed five percent (5%) annual increases, of the outstanding shares of common stock after giving effect to the Reverse Stock Split, and provided further that for a period of 12 months after the Closing, Parent shall not register with the Securities and Exchange Commission any of the shares to be issued or reserved for issuance under the Equity Plan, and provided further that all shares or other securities granted under the Equity Plan shall be “locked up” and not be permitted to be sold, hypothecated or transferred for a period that shall terminate not earlier than the date that is the one year anniversary of the Closing. Any prohibition in this Section shall be null and void one year after the Closing.

8.8               Restricted Stock; Piggyback Registration Rights. The shares to be issued hereunder (the “Merger Shares”) have not been registered with the United States Securities and Exchange Commission (“SEC”) or with the securities regulatory authority of any state. The Merger Shares are subject to restrictions imposed by federal and state securities laws and regulations on transferability and resale, and may not be transferred assigned or resold except as permitted under the Securities Act of 1933, as amended (the “Act”), and the applicable state securities laws, pursuant to registration thereunder or exemption therefrom. Parent, following the Merger, may also be referred to herein as “SplashPM.” At such time, if ever, that SplashPM determines to file a registration statement with the SEC relating to an offering for its own account, or the account of others under the Act, of any of its equity securities (other than on Form S-4 or Form S-8 or their then equivalents relating to equity securities to be issued solely in connection with any acquisition of any entity or business or equity securities issuable in connection with stock option or other bonafide employee benefit plans) (the “Registration Statement”), SplashPM shall send written notice of such determination to those Company Shareholders entitled to piggyback registration rights under the Note Conversion and Preferred Stock Conversion Agreements (collectively the “Registration Rights Holders” and individually a “Rights Holder”), and, if within 10 days after the date of receipt of such notice the Registration Rights Holders, or any of them, shall so request in writing, SplashPM shall include within the Registration Statement all or any part of the Merger Shares (“Registerable Securities”) requested to be registered, provided however Registerable Securities may be removed pro rata to the percentage of securities being removed by other selling shareholders whose shares are also covered by the Registration Statement (“Removed Registerable Securities”) if such removals are required to comply with any written comments from the SEC with respect to Rule 415 promulgated under the Act. The Company covenants to maintain the effectiveness of the Registration Statement, and of any registration statement filed thereafter which must include the Removed Registerable Securities, if any, (an “RRS Registration Statement”), by promptly preparing and filing post-effective amendments to the Registration Statement and RRS Registration Statement until all of the Registerable Securities and Removed Registerable Securities are sold. The registration rights granted herein shall remain in full effect and continue to extend to the Registerable Securities and Removed Registerable Securities until they are sold. All fees and costs of or incidental to any such registration statement shall be borne by the Company and SplashPM. All shares of restricted common stock of Parent outstanding at the time of Closing and all shares of common stock underlying outstanding options of Parent at time of Closing shall be provided and accorded the same registration rights as given hereunder to Registration Rights Holders. Parent further covenants that it will not extend, provide or permit piggyback registration rights to any holder of Permitted Closing Debt for so long as any Rights Holder has not fully sold its Registerable Securities.

8.9               Restriction on Splits; Share Combinations. Other than the Reverse Stock Split, SplashPM shall not effect or permit any additional share combinations or reverse stock splits for 18 months following the Closing.

8.10           Management Bonuses and Salary Freeze. Until SplashPM reports in its SEC filings an operating profit under GAAP from recurring revenue for at least two consecutive quarters, SplashPM shall pay no bonuses nor provide or allow salary or other compensatory raises or increases to any member of its management team.

8.11           Limitation on Future Offerings. For a period of 12 months following the Closing, SplashPM shall enter into no financing, sell no securities or securities convertible into common stock or other equity of SplashPM, grant no option, warrant or other right to purchase or acquire securities of SplashPM on a cashless basis, or at a price which on a net basis after costs is or would result in a price per share of less than $1.10 per share (before giving effect to the Reverse Stock Split).

8.12           Lock-Up/Leak Out. At the time of Closing, all affiliates of SplashPM including officers, directors and beneficial owners of more than 10% of SplashPM shares, but excluding all holders of restricted shares of common stock of Parent immediately prior to the Closing shall enter or shall have entered into Lock-up/Leak out agreements, substantially in the form attached hereto as Exhibit D and as set forth on Schedule 8.12, by which they agree [a] not to sell any shares for six months (the “L/U Term”), [b] may release from lock-up up to 25% of their shares three months after the L/U Term and [c] release from lock-up all remaining of their shares six months after the L/U Term. In the alternative all shares that are subject to Lock- up/Leak out agreements may be released from the Leak out provisions of the agreements any time following the L/U Term (“Early L/U Release”) when both (1) volume of Parent shares traded are at least 50,000 shares per day (the “Volume Condition”) and (2) the closing price per share determined on a volume weighted average price basis equals not less than 300% of deemed value per share (the “Price Condition”) for 20 consecutive trading days (the “Trading Term Period”) have been met. For purposes hereof “deemed value per share” shall equal the aggregate Parent enterprise value post Merger Transaction, divided by the total number of shares outstanding. By way of illustrating an Early L/U Release where both the Volume Condition and the Price Condition are met, if a share of Parent has a deemed value of $1 upon completion of the Merger Transaction then the closing price per share, before giving effect to the Reverse Stock Split, must be at least $3 on a volume weighted average price basis and trading volume must be at least 50,000 shares over 20 consecutive trading days. If either of Volume Condition or the Price Condition is not met over the Trading Term Period then Early L/U Release shall not be available. Notwithstanding the foregoing those shareholders who are not officers of SplashPM or Company and who have invested $500,000 or more in the Company at least six months prior to the Closing shall not be required to enter into Lock-up/Leak out agreements.

8.13           Covenant to Make Timely SEC Filings. SplashPM covenants that for a period of not less than twenty four months after Closing SplashPM timely shall make all annual, quarterly, periodic and other filings required to be made under federal securities laws and it shall not file, cause or allow to be filed with the SEC during this period any Form 15, or take any other action by which SplashPM will terminate or seek to terminate or suspend SplashPM’s duty to file reports under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) or suspend SplashPM’s duty to file required reports under Section 13 or Section 15(d) of the Exchange Act.

Section 9. Indemnification.

9.1               Indemnity Agreement of Company. Subject to the provisions and limitations of this Section 9, Company, for itself, its successors and assigns, agrees to indemnify, save and hold harmless each of Parent and Sub and its respective officers, directors, representatives, and agents from and against:

(a)                Failure to Perform Obligations. Any Event of Loss (as defined below) or Loss (as defined below) arising as a result of Company’s failure to perform or discharge any of its duties or obligations to be performed by Company hereunder prior to the Closing Date; and

(b)               Breach of a Representation Warranty or Covenant. Any Event of Loss or Loss arising from any breach of a representation, warranty or covenant of Company set forth in this Agreement.

9.2               Indemnity Agreement of Parent and Sub. Subject to the provisions and limitations of this Section 9, each of Parent and Sub, for itself, its successors and assigns, agrees to indemnify and save harmless Company from and against:

(a)                Failure to Perform Obligations. Any Event of Loss or Loss arising as a result of Parent’s or Sub’s failure to discharge or perform any duties or obligations to be performed by Parent or Sub hereunder prior to the Closing Date; and

(b)               Breach of Representation, Warranty or Covenant. Any Event of Loss or Loss arising from any breach of a representation, warranty or covenant of Parent or Sub set forth in this Agreement.

9.3               Definition of “Loss”. Any party to this Agreement against which indemnification may be sought pursuant to this Section 9 shall be herein called an “Indemnifying Party,” and any person entitled to indemnification pursuant to this Section 9 shall be herein called an “Indemnified Party.” The occurrence of an event which may result in a loss, cost, expense or liability of an Indemnified Party hereunder as to which the Indemnifying Party shall have received notice from the Indemnified Party shall be herein called an “Event of Loss,” and the amount of any loss, cost, expense or liability of any kind whatsoever (including legal fees and disbursements incurred in connection therewith) incurred by an Indemnified Party shall be herein called a “Loss;” provided, however, that for purposes of computing the amount of Loss incurred by any Indemnified Party, there shall be deducted an amount equal to the amount of any insurance proceeds (other than self-insurance) directly or indirectly received by such Indemnified Party in connection with such Loss or the circumstances giving rise thereto.

Upon payment by an Indemnified Party of any Loss, the Indemnifying Party shall discharge its obligation to indemnify the Indemnified Party against such Loss by paying to the Indemnified Party an amount that, on an after-tax basis reflecting the hypothetical tax consequences, if any, of the receipt of such amount, shall be equal to the hypothetical after-tax amount of such Loss by taking into account the hypothetical tax consequences, if any, to the Indemnified Party of the payment of such Loss. For purposes of this Section 9, references to “after-tax basis,” “hypothetical” tax consequences and “hypothetical” after-tax amount refer to calculations of foreign, federal, state and local tax at the maximum statutory rate (or rates, in the case of an item of income or deduction taxable or deductible for purposes of more than one tax) applicable to the Indemnified Party for the relevant year, after taking into account, for example, the effect of deductions available for other taxes such as state and local income taxes, which effect would similarly be calculated on the basis of the maximum statutory rate (or rates) of the tax (or taxes) for which such deduction was available.

9.4               Insurance Proceeds Received After Indemnification. Each party agrees that, if it receives any payments from the other party hereto with respect to any Loss pursuant to this Section 9 and subsequently such party receives any amount of insurance proceeds (other than from self-insurance) in connection with any such Loss or the circumstances giving rise thereto, such party agrees to promptly deliver or cause to be delivered the amount of such insurance proceeds to the party that made such indemnification payments pursuant to this Section 9; provided, however, a party shall not be required to pay (or cause to be paid) to the other party an amount of insurance proceeds in excess of the payment in respect of the related Loss paid by the Indemnifying Party.

9.5               Deductible Amount and Time Period. An Indemnifying Party shall not be required to make any indemnification payments hereunder for which such Indemnifying Party would otherwise be liable under this Section 9 until (and then only to the extent that) the total of all amounts to which, but for the provisions of this sentence, the Indemnified Party would be entitled pursuant to this Section 9 with respect to all Losses actually exceeds $25,000; provided, however, that the limitations on liability set forth in this sentence shall not be applicable to (i) any claim against an Indemnifying Party alleging fraudulent misrepresentation or (ii) any payments to be made by the Indemnifying Party pursuant to any provision of this Agreement (other than those set forth in this Section 9) or any provision of the instruments of assumption referred to herein.

Notwithstanding anything in this Section 9 to the contrary, the Indemnifying Party shall have (i) no liability for any Loss arising out of claims of a person not a party or an affiliate of a party to this Agreement as to which the Indemnifying Party shall not have received notice within six years from the Closing Date and (ii) no liability for any Loss arising out of claims under this Agreement (other than those referred to in clause (i) of this sentence) as to which the Indemnifying Party shall not have received notice within four years from the Closing Date.

9.6               Defense of Claims. In case any legal action shall be commenced or threatened (provided that in the case of a threatened legal action the Indemnified Party believes in good faith that an indemnifiable Loss is likely to occur) against an Indemnified Party which could result in a Loss, the Indemnified Party shall promptly notify the Indemnifying Party in writing. After receipt of any such notice, the Indemnifying Party shall have the right, exercisable by written notice of exercise to the Indemnified Party promptly after receipt of the notice provided for in the next preceding sentence, (A) to participate in and (B) assume (and control) the defense of such action, at its own expense and with its own counsel, provided such counsel is satisfactory to the Indemnified Party. If the Indemnifying Party elects to assume the defense of such action, the Indemnifying Party shall keep the Indemnified Party informed of all material developments and events relating to such action. The Indemnified Party shall have the right to participate in (but not control) the defense of any such action, but the fees and expenses of counsel for the Indemnified Party shall be at its own expense except as set forth in the following sentence. The Indemnifying Party shall bear the reasonable fees and expenses of counsel retained by the Indemnified Party if (i) the Indemnified Party shall have retained such counsel due to actual or potential conflicting interests between the Indemnified Party and the Indemnifying Party, (ii) the Indemnifying Party shall not elect to assume the defense of the action, (iii) the Indemnifying Party shall not have employed counsel satisfactory to the Indemnified Party to represent the Indemnifying Party in connection with its assumption of the defense of the action within a reasonable time after notice pursuant to the first sentence of this paragraph is delivered to the effect that such action has been commenced or is threatened, or (iv) the Indemnifying Party has authorized the employment of counsel for the Indemnified Party to handle the defense of the action at the expense of the Indemnifying Party. In no event will the Indemnifying Party be liable for any settlement or admission of liability with respect to any action without its prior written consent, which shall not be unreasonably withheld, but if settled with such consent, the Indemnifying Party shall be liable therefor, subject to the limitations set forth in this Section 9. The Indemnifying Party may not settle any liability or claim subject to indemnification pursuant to this Section 9 without the consent of the Indemnified Party and on any basis that does not provide for a full release of the Indemnified Party. Any participation in, or assumption of the defense of, any action by an Indemnifying Party shall be without prejudice to the right of the Indemnifying Party, and shall not be construed as a waiver of its right to deny the obligation to indemnify the Indemnified Party. The giving of notice, as above provided, of a loss, damage, cost or expense claimed to be indemnifiable hereunder, to exercise the right, as the same is provided (and limited) herein, to participate in and assume control of the defense against such claim, shall be a prerequisite to any obligation to indemnify; provided, however, that the Indemnified Party’s rights pursuant to this Section 9 shall not be forfeited by reason of a failure to give such notice or to cooperate in the defense to the extent such failure does not have a material and adverse effect on the defense of such matter. Notwithstanding any of the above, Parent shall have control of any action arising from a tax claim to the extent such claim is reflected on Parent’s tax returns.

9.7               Payment of Loss; Subrogation. Any Loss for which an Indemnified Party is entitled to payment hereunder shall be paid by the Indemnifying Party upon written demand by the Indemnified Party. The Indemnifying Party shall be subrogated to any claims or rights of the Indemnified Party as against any other persons with respect to any Loss paid by the Indemnifying Party under this Section 9. The Indemnified Party shall cooperate with the Indemnifying Party to a reasonable extent, at the Indemnifying Party’s expense, in the assertion by the Indemnifying Party of any such claims against such other persons.

9.8               Notice of Event of Loss. Each party agrees that it will give notice to the other party hereunder promptly, but in no event later than 30 days, after the receipt by one of its responsible officers of knowledge of a state of facts which, if not corrected, would be an Event of Loss hereunder. Each party shall make available to the other party and its counsel and accountants, at reasonable times and for reasonable periods, during normal business hours, all books and records of such party relating to any such possible Event of Loss, and each party will render to the other such assistance as it may reasonably require of the other in order to insure prompt and adequate prosecution of the defense of any suit, claim or proceeding based upon such state of facts.

Section 10. Termination of Agreement. This Agreement and the transactions contemplated hereby may be terminated in the following manner:

10.1           This Agreement may be terminated at any time before Closing by the mutual consent of the Board of Directors of Parent (on behalf of Parent and Sub) and the Board of Directors of Company.

10.2           Parent (on behalf of Parent and Sub) may terminate this Agreement, at its sole option, if the Closing has not occurred by February 15, 2020.

10.3           Company may terminate this Agreement, at its sole option, if the Closing has not occurred by February 15, 2020.

10.4           Either Parent or Company may terminate this Agreement prior to Closing

if:

(a)                the other (with Parent and Sub being one party for this purpose) breaches its representations, warranties or covenants herein in any material respect; or

(b)               any event occurs or fails to occur which renders impracticable satisfaction of any of the conditions to its respective obligations under Sections 6 or 7 hereof.

10.5           Upon termination of this Agreement as provided for above and notwithstanding any other provision of this Agreement, none of the parties hereto shall have any further rights or obligations hereunder. In the event of the termination of this Agreement pursuant to the preceding sentence, the provisions set forth in the first sentence of Section 11.1 and in Section 11.4 shall survive such termination.

10.6           Written notice of termination of this Agreement, as provided for in this Section 10, shall be given by the party so terminating to the other party hereto, in accordance with the provisions of Section 11.12 hereof.

Section 11. Miscellaneous Provisions.

11.1           Expenses. Except as otherwise provided in this Agreement, each party hereto shall pay its own expenses incident to the origination, negotiation and execution of this Agreement and the consummation of the transactions contemplated hereby, including all legal and accounting fees and disbursements.

11.2           Payment and Expenses of Other Parties. Company, Parent and Sub agree that if subsequent to the Closing Date any of them shall receive any payment due to another party each shall promptly remit the same to the other (net of any tax imposed upon either party in respect of the receipt of such payment), and if any party shall pay any obligations of the other not assumed by it hereunder, the payment shall be for the account of the party to whom the obligation relates and such party shall promptly reimburse the other party for any such payment.

11.3           Annexes and Schedules. The Annexes and Schedules attached hereto are incorporated herein and made a part hereof for all purposes. As used herein, the expression “this Agreement” means the body of this Agreement and such Annexes and Schedules; and the expressions “herein,” “hereof,” and “hereunder” and other words of similar import refer to this Agreement and such Annexes and Schedules as a whole and not to any particular part or subdivision thereof.

11.4           Survival of Obligations. Subject to the applicable limitations of Section 10 above, the respective representations, warranties, covenants and agreements of the parties to this Agreement shall survive consummation of the transactions contemplated by this Agreement and shall continue in full force and effect after the Closing Date.

11.5           Amendments and Waivers. Except as otherwise specifically stated herein, any provision of this Agreement may be amended by, and only by, a written instrument executed by Parent on one part (acting as a single party for purposes of this Section 11.5 with Sub) and Company on another part. Company may extend the time for or waive the performance of any obligation of Parent or Sub, waive any inaccuracies in the representations or warranties by Parent or Sub or waive compliance by Parent or Sub with any of the terms and conditions contained in this Agreement. Any such extension or waiver shall be in writing and executed by Company. Parent may extend the time for or waive the performance of any obligations of Company, waive any inaccuracies in the representations or warranties by Company, or waive compliance by Company with any of the terms and conditions contained in this Agreement. Any such extension or waiver shall be in writing and executed by Parent.

11.6           Further Assurances. From and after the Closing Date, the parties shall, on request, cooperate with one another by furnishing any additional information, executing and delivering any additional documents and instruments, and doing any and all such other things as may be reasonably required by the parties or their counsel to consummate or otherwise implement the transactions contemplated by this Agreement.

11.7           Public Statements. Except as may be required by law, none of Company, Parent or Sub shall issue any press release or other public statement concerning the transactions contemplated by this Agreement without first providing the others with a written copy of the text of such release or statement and obtaining the consent of the other (with Parent acting on behalf of itself and Sub) respecting such release or statement.

11.8           Confidentiality. If the transactions contemplated by this Agreement shall be consummated, (i) Company shall keep this Agreement, the terms hereof, and all documents and information relating to this Agreement and to the Business confidential, except as may be required by law and (ii) Parent and Sub shall keep this Agreement, the terms hereof, and all documents and information received from Company, to the extent they relate to anything other than the Business, confidential, except as may be required by law. In the event that the transactions contemplated by this Agreement shall not be consummated, each party (with Parent acting on behalf of itself and Sub as a single party for purposes of this Section 11.8) (i) shall return to the other party all such documents and written information as it shall have received from the other party in connection with this Agreement, (ii) shall treat such documents and information as confidential, and (iii) shall not disclose or utilize, and shall use its best efforts to prevent any of its employees from disclosing or utilizing, such documents and information. However, in any event, the restrictions of this Section 11.8 shall not apply (i) in the case of Parent, to any document or information if such document or information (A) was already known to Parent, as evidenced by Parent’s written records, prior to the receipt of such document or information from Company, (B) was publicly available at the time of the disclosure of such document or information by Company to Parent or subsequently became publicly available through no fault of Parent, or (C) was approved for public disclosure by the written authorization of Company and (ii) in the case of Company, to any document or information, if such document or information (A) was publicly available at the time of disclosure of such document or information by Company to Parent or subsequently became available through no fault of Company or (B) was approved for public disclosure by the written authorization of Parent. Notwithstanding any termination of this Agreement, the parties’ obligations under this Section 11.8 shall continue and survive such termination for a period of five years from the date hereof.

11.9           Parties Bound. This Agreement shall apply to, inure to the benefit of and be binding upon and enforceable against the parties hereto and their respective successors and permitted assigns. The respective rights and obligations of any party hereto shall not be assignable without the consent of the other parties. No assignment shall relieve the assigning party of any of its obligations. This Agreement is for the sole benefit of the parties hereto and their respective successors and permitted assigns and nothing herein, express or implied, is intended to or shall confer upon any other person or entity any legal or equitable right, benefit or remedy of any nature whatsoever under or by reason of this Agreement.

11.10       Governing Law and venue. This Agreement, and the rights and obligations of the parties hereto, shall be governed by and construed in accordance with the laws of the State of Nevada. Any legal suit, action or proceeding arising out of or based upon this Agreement or the transactions contemplated hereby may be instituted in the federal courts of the United States of America located in the city of Manhattan and county of New York, and each party irrevocably submits to the exclusive jurisdiction of such courts in any such suit, action or proceeding. Each party acknowledges and agrees that any controversy which may arise under this Agreement is likely to involve complicated and difficult issues and, therefore, each such party irrevocably and unconditionally waives any right it may have to a trial by jury in respect of any legal action arising out of or relating to this Agreement or the transactions contemplated hereby

.

11.11       Remedies. Each party recognizes that money damages may be inadequate to compensate a party for a breach by the other party of its obligations under this Agreement, and each party agrees that in the event of such a breach non-breaching party may apply for an injunction of specific performance or the granting of such other equitable remedies as may be awarded by a court of competent jurisdiction in order to afford the non-breaching party the benefits of this Agreement and that the breaching party shall not object to such application, entry of such injunction or granting of such other equitable remedies on the ground that money damages will be sufficient to compensate the non-breaching party.

11.12       Notices. Any notice, demand, approval, consent, request, waiver or other communication which may be or is required to be given pursuant to this Agreement shall be in writing and shall be deemed given on the earlier of the day actually received or on the close of business on the second business day next following the day when deposited in the United States mail, postage prepaid, certified or registered, addressed to the party at the address set forth after its respective name below, or at such different address as such party shall have theretofore advised the other party in writing, with copies sent to the persons indicated:

If to Company:

Splash Beverage Group, Inc.

1314 E. Las Olas Blvd Suite #221

Fort Lauderdale, Florida 33301

Attention: Robert Nistico, Chief Executive Officer

With a copy (that shall not constitute notice) to :

Darrin Ocasio

Sichenzia Ross Ference LLP

1185 Avenue of the Americas, 37th Floor,

New York, New York 10036

If to Parent or Sub:

Canfield Medical Supply, Inc.

4120 Boardman-Canfield Road

Canfield, Ohio 44406

Attention: John Mathias Lepo, Chief Executive Officer

With a copy (that shall not constitute notice) :

Aaron A. Grunfeld

Law Offices Aaron A. Grunfeld & Associates

10940 Wilshire Boulevard, 23rd Floor

Los Angeles, California 90024

11.13       Number and Gender of Words. Whenever herein the singular number is used, the same shall include the plural where appropriate, and the words of any gender shall include each other gender where appropriate.

11.14       Captions. The captions, headings and arrangements used in this Agreement are for convenience only and do not affect, limit or amplify the terms and provisions hereof.

11.15       Invalid Provisions. If any provision hereof is held to be illegal, invalid or unenforceable under present or future laws effective during the term hereof, such provision shall be fully severable; this Agreement shall be construed and enforced as if such illegal, invalid or unenforceable provision had never comprised a part hereof; and the remaining provisions hereof shall remain in full force and effect and shall not be affected by the illegal, invalid or unenforceable provision or by its severance herefrom. In lieu of such illegal, invalid or unenforceable provision there shall be added automatically as a part hereof a provision as similar in terms to such illegal, invalid or unenforceable provision as may be possible and be legal, valid and enforceable.

11.16       Accounting Terms. Unless otherwise specified or agreed to in writing by the parties hereto, all accounting terms used in this Agreement shall be interpreted in accordance with United States generally accepted accounting principles applied on a consistent basis.

11.17       Entirety of Agreement. This Agreement contains the entire agreement between the parties. No representation, inducements, promises or agreements, oral or otherwise, which are not embodied herein shall be of any force or effect. This Agreement replaces and supersedes in its entirety the Term Sheet.

11.18       Currency. All dollar amounts stated herein, unless otherwise specified, are stated in United States currency.

11.19       Brokerage and Finder’s Fees. Each party hereto agrees to pay all expenses and fees it has incurred to the extent that it has engaged a broker or finder in connection with this transaction and further agrees to indemnify and save the other party hereto harmless from any claims by any such brokers or finders in connection with the Merger and the other transactions contemplated by this Agreement.

11.20       Multiple Counterparts; Facsimile Signature; Effectiveness. This Agreement may be executed in multiple counterparts, each of which shall be deemed an original for all purposes and all of which shall be deemed, collectively, one agreement. This Agreement may be executed by facsimile signature, each of which shall be deemed an original for all purposes hereof. This Agreement shall become effective when executed and delivered by the parties hereto.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement and Plan of Merger as of the date first above written.

PARENT:

CANFIELD MEDICAL SUPPLY, INC.

By:                                                                     

John Mathias Lepo, Chief Executive Officer

SUB:

SBG ACQUISITION, INC.

By:                                                                     

John Mathias Lepo, Chief Executive Officer

COMPANY:

SPLASH BEVERAGE GROUP, INC.

By:

      ___________________________ 

Robert Nistico, Chief Executive Officer

S-1

INDEX OF SCHEDULES

TO 

AGREEMENT AND PLAN OF MERGER

by and among

Canfield Medical Supply, Inc.,

SBG Acquisition Inc., and

Splash Beverage Group, Inc.

Splash Schedules

Schedule

Title

I

Company Shareholders

3.7

Capitalization

3.9

Principal Assets

3.11

Litigation, Etc.

3.22

Material Undisclosed Liabilities

Canfield Medical Supply Schedules

4.6

Capitalization.

Schedule I

Company Shareholders

Schedule 3.7 

Capitalization

Schedule 3.9

Principal Assets

Schedule 3.11

Litigation, Etc.

Schedule 3.14

ERISA

Schedule 3.15

Employee Plans

Schedule 3.19

Exceptions to Ownership of Patents, Licenses and Permits

Schedule 3.20

Exceptions to Ownership of Trademarks, etc.

Schedule 3.22

Material Undisclosed Liabilities

Schedule 3.24

Tax Returns and Tax Liabilities

Schedule 3.25

Officers and Employees

Schedule 4.6

Capitalization

Capitalization of Canfield Medical Supply, Inc. is as set forth on its Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on November 14 , 2019.

Schedule 4.13

Absence of Undisclosed Liabilities

Schedule 4.14

Tax Returns and Tax Liabilities

Exhibit A

Form of Business Transfer and Indemnity Agreement

Exhibit B

Form of Promissory Note Conversion Agreement

Exhibit C

Form of Preferred Stock Conversion Agreement

Exhibit D

Form of Lock-Up/Leak out Agreement

Exhibit 10.3

PREFERRED STOCK CONVERSION AGREEMENT

This Preferred Stock Conversion Agreement (the “Agreement”) is entered into as of December __, 2019 by and between Splash Beverage Group, Inc. a Nevada corporation (the “Company”), and ______________ (the “Preferred Holder”), with reference to the following facts:

A. The Company has issued 6,913,412 shares of preferred stock, par value $0.001 per share, including 3,000,000 shares of Series A Convertible Preferred Stock (the “Series A Preferred Stock”) and 3,913,412 shares of Series B Convertible Preferred Stock (the “Series B Preferred Stock” and, collectively with the Series A Preferred Stock, the “Preferred Stock”).

B. The Company intends to merge with a subsidiary of Canfield Medical Supply Inc. (the “Merger”) under terms which require that as of completion of the Merger (i) substantially all of the Company’s debt, which at December 6, 2019 amounted to more than $6 million, and (ii) all shares of the Company’s preferred stock shall be converted into shares of Canfield Medical Supply Inc..

C. Upon completion of the Merger the Company will be a wholly owned subsidiary of Canfield Medical Supply Inc. (the “Parent”) and shareholders of the Company will own in the aggregate, on a fully diluted basis, after giving effect to conversions of all debt and preferred stock, and all outstanding options, warrants, and or other rights to acquire Company securities, not less than 85% of Parent, with the ability to receive an additional 1.25% of Parent (the “New Capital Bonus Shares”), for an aggregate total of 86.25% ownership of Parent, computed as of the date of Merger, if the post-Merger Parent is able to sell, issue and receive $9 million of additional equity capital no later than six months after the date of the Merger (the “New Capital”).The post-Merger Parent shall hereinafter be referred to as “SplashPM .”

D. Each share of Preferred Stock of the Company shall be converted into an amount of fully paid and nonassessable shares of common stock of SplashPM equal to the Conversion Number for the Company’s Preferred Stock subject to adjustment as may be set forth under the terms of the Merger. The “Conversion Number” shall be 1.362921798 shares of SplashPM for each share of Company’s Preferred Stock outstanding .

E. Conversion of the Preferred Stock shall become effective upon completion of the Merger subject further to the representations, covenants and other terms set forth below.

F. SplashPM has authorized but unissued 5 million shares of “blank check” preferred stock, no par value.

G. Based on the foregoing the Company and Preferred Holder desire to convert the entire amount of Preferred Stock outstanding into shares of Company Common Stock, $0.001 par value (the “Common Stock”).

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties agree as follows:

1. Conversion to Common Stock. The entire amount of Preferred Stock shall be converted into ___________________ (__________) shares  of Common Stock (the “Conversion Shares”) effective upon the Merger. Upon execution of this Agreement and surrender of the Preferred Stock, SplashPM shall instruct its transfer agent to issue the Conversion Shares to the Preferred Holder at the address on the signature page hereto.

2. Surrender of Preferred Stock. Following execution of this Agreement and upon the Merger becoming effective, the Preferred Stock shall no longer be outstanding and shall automatically be canceled and retired and shall cease to exist, and each Preferred Holder of a certificate representing any such shares shall cease to have any rights with respect thereto, except the right to receive the Conversion Shares, to be issued in consideration therefor, upon the surrender of such certificate in accordance with the Merger, without interest , provided, however, upon receipt of evidence reasonably satisfactory to the Corporation (an affidavit of the Holder) of the loss, theft, destruction or mutilation of any certificate evidencing this preferred stock certificate, and in the case of any such loss, theft or destruction, upon receipt of an indemnity reasonably satisfactory to the Company, or in the case of any such mutilation, upon surrender and cancellation of such certificate, the Company shall (at its expense) execute and deliver in lieu of such certificate a new certificate of like tenor and dated the date of such lost, stolen, destroyed or mutilated certificate. If the Merger does not occur prior to February 15, 2020 this Agreement shall terminate.

3. Restricted Stock; Piggyback Registration Rights. The Conversion Shares to be issued hereunder have not been registered with the United States Securities and Exchange Commission or with the securities regulatory authority of any state. The Conversion Shares are subject to restrictions imposed by federal and state securities laws and regulations on transferability and resale, and may not be transferred assigned or resold except as permitted under the Securities Act of 1933, as amended (the “Act”), and the applicable state securities laws, pursuant to registration thereunder or exemption therefrom. At such time, if ever, that SplashPM determines to file a registration statement with the Securities and Exchange Commission (“SEC”) relating to an offering for its own account, or the account of others under the Act, of any of its equity securities (other than on Form S-4 or Form S-8 or their then equivalents relating to equity securities to be issued solely in connection with any acquisition of any entity or business or equity securities issuable in connection with stock option or other bona fide employee benefit plans) (the “Registration Statement”), SplashPM shall send to Preferred Holder written notice of such determination and, if within 10 days after the date of receipt of such notice Preferred Holder shall so request in writing, SplashPM shall include in the Registration Statement all or any part of the Conversion Shares that Preferred Holder requests to be registered, provided however any Conversion Shares may be removed pro rata to the percentage of securities being removed by other selling shareholders whose shares are also covered by the Registration Statement (“Removed Conversion Shares”) if such removals are required to comply with any written comments from the SEC with respect to Rule 415 promulgated under the Act. The Company covenants to maintain the effectiveness of the Registration Statement, and of any registration statement filed thereafter which must include the Removed Conversion Shares if any (an “RCS Registration Statement”), by promptly preparing and filing post-effective amendments to the Registration Statement and RCS Registration Statement until all of the Conversion Shares and Removed Conversion Shares are sold. The registration rights granted herein shall remain in full effect and continue to extend to the Conversion Shares and Removed Conversion Shares until they are sold. All fees and costs of or incidental to any such registration statement shall be borne by the Company and SplashPM.

4. Preferred Holder Representations. The Company is issuing the Conversion Shares to the Preferred Holder in reliance upon the following representations made by the Preferred Holder:

(a)        Preferred Holder is an “accredited investor” within the meanings set forth in Regulation D promulgated under the Act.

(b)        Preferred Holder (i) has had, and continues to have, access to detailed information with respect to the business, financial condition, results of operations and prospects of the Company and SplashPM; (ii) has received or has been provided access to all material information concerning an investment in the Company and SplashPM; and (iii) has been given the opportunity to obtain any additional information or documents from, and to ask questions and receive answers of, the officers, directors and representatives of the Company and SplashPM to the extent necessary to evaluate the merits and risks related to an investment in the Company and SplashPM represented by Common Stock.

(c)       As a result of the foregoing and Preferred Holder prior overall experience in financial matters, and Preferred Holder’s familiarity with the nature of the Company’s businesses and SplashPM, Preferred Holder is able to evaluate the capital structure of the Company and SplashPM, the business of the Company and SplashPM, and the risks inherent therein.

(d)       Preferred Holder investment in the Company is consistent, in both nature and amount, with Preferred Holder’s overall investment program and financial condition.

(e)       Preferred Holder’s financial condition is such that Preferred Holder can afford to bear the economic risk of holding the Common Stock, and to suffer a complete loss of Preferred Holder’s investment in the Company represented by the Preferred Stock and the Conversion Shares.

(f)        Preferred Holder’s address is set forth on the signature page hereto.

(g)       Preferred Holder hereby waives any rights that the Preferred Holder may have under the Splash Beverage Group, Inc. Right of First Refusal and Co-Sale Agreement, dated October 2014, by and among the Company and the holders of Common Stock as set forth in such Agreement. The Preferred Holder hereby acknowledges and agrees that as of the date hereof the Preferred Holder shall not be entitled to any rights under the Certificate of Designations, Preferences and Rights of the Preferred Stock (Series A and/or Series B) and hereby waives the Company’s compliance with the Certificate of Designations, Preferences and Rights of the Preferred Stock. Reference is made to the Investor’s Rights Agreement, dated October 2014, between the Company and the investors set forth thereto. The Preferred Holder hereby waivers the Company’s compliance with the provisions of the Investor’s Rights Agreement .

(h)        In consideration of the promises recited in this Agreement, and other than with respect to the obligations contained in this Agreement, each Preferred Holder including their successors, agents and assigns hereby does, knowingly and voluntarily, release, acquit and forever discharge the Company and the Company’s successors, assigns, officers, directors, shareholders, attorneys, agents, employees and representatives (collectively, the “Releasees”), from any and all claims, suits, demands, causes of action, debts, damages, costs, losses, obligations, judgments, charges, expenses, dues, sums of money, accounts and controversies of whatever kind or nature, direct or indirect, arising in tort or contract, whether known or unknown, contingent or noncontingent, at law or in equity relating to any matters of any kind, whether presently known or unknown, suspected or unsuspected that the Preferred Holder may possess against any of the Releases arising from any omissions, acts, facts or damages that have occurred up until and including the effective date of this Agreement and as of the date of the consummation of the Merger.

(l)       Each party to this Agreement has read and understands the following language of Section 1542 of the California Civil Code which provides:

A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM MUST HAVE MATERIALLY AFFECTED HIS SETTLEMENT WITH THE DEBTOR

It is expressly understood and agreed that all rights under Section 1542 of the Civil Code of the State of California are expressly waived by each of the parties to this Agreement, to the full extent allowed by law. Each party to this Agreement, agrees that this Agreement shall extend and apply to all unknown, unsuspected and unanticipated claims, demands, injuries, or damages within the scope of this Agreement and the releases herein. Each party to this Agreement acknowledge that they are aware that statutes exist which render null and void releases and discharges of any claims, rights, demands, liabilities, actions and causes of action which are unknown to the releasing or discharging party at the time of execution of said release and discharge. Each party to this Agreement expressly waives any equivalent provision of any statute of the United States or any other state or jurisdiction with respect to such claims, demands, injuries, or damages within the scope of this Agreement.

5. Company Representations and Covenants. Preferred Holder is converting the amounts of Preferred Stock for the Conversion Shares in reliance upon the following representations made by the Company:

(a).      The Company is a corporation duly organized, validly existing and in good standing under the laws of the State of Colorado and has all requisite corporate power and authority to carry on its business as now conducted and as proposed to be conducted. The Company is duly qualified as a foreign corporation to do business and is in good standing in every jurisdiction in which its ownership or use of property or the nature of the business conducted by it makes such qualification necessary except where the failure to be so qualified or in good standing would not have a material adverse effect on its operations or financial condition.

(b).      The Company has the requisite corporate power and authority to execute, deliver and perform its obligations under this Agreement. This Agreement and the issuances of the Conversion Shares, and conversion of the Preferred Stock and the right to rescind the conversions herein provided if the New Capital is not timely obtained, have been (a) duly approved by the Board of Directors of the Company, and (b) the Conversion Shares, when issued pursuant to the Agreement and upon delivery, shall be validly issued and outstanding, fully paid and non-assessable.

(c).      The execution, delivery and performance of the Agreement by the Company and the consummation of the transactions contemplated hereby, will not, with or without the giving of notice or the passage of time or both: (a) violate the provisions of the Articles of Incorporation or bylaws of the Company; or (b) violate any judgment, decree, order or award of any court binding upon the Company or will not (c) otherwise prohibit the consummation of any of the transactions contemplated by this Agreement by litigation, statute, rule, regulation, executive order, decree, ruling or injunction enacted, entered, promulgated or endorsed by any governmental authority of competent jurisdiction or any self-regulatory organization having authority over the matters contemplated hereby.

(d).      This Agreement constitutes the valid and legally binding obligations of the Company and are enforceable against the Company in accordance with its respective terms.

(e).      The Conversion Shares have not been registered under the Securities Act of 1933, as amended (the “Act”) or under the laws of any state or other jurisdiction, and are or will be issued pursuant to a valid exemption from registration.

(f).      The Company has advised Preferred Holder that this Agreement is one of various other Agreements being entered into by the Company and note holders or persons to whom the Company is indebted. The Company represents and affirms that each such noteholder and person is converting debt at $1.00 per share and that no noteholder has or will have terms that are more favorable than those being granted to Preferred Holder under this Agreement.

(g)        If the Company or SplashPM should fail timely to satisfy the New Capital Covenant, within five business days of the date of such non-compliance (“Conversion Covenant Failure”), SplashPM or the Company shall give written notice (the “Non Compliance Notice”) to Preferred Holder of the Conversion Covenant Failure and Preferred Holder may within ten business days thereafter notify the Company or SplashPM of Preferred Holder’s desire to rescind this Agreement (the “Rescission Election”). Not later than thirteen business days following the date of the Non Compliance Notice, the Company shall send to Preferred Holder an updated report setting forth names of all other Preferred Holders who have provided the Company and SplashPM with a Rescission Election and the rescission share amounts for each such Preferred Holder (the “Rescission Election Report”). Within five business days following receipt of the Rescission Election Report, Preferred Holder may deliver a follow-on notice to the Company and SplashPM whereby it either affirms or withdraws its Rescission Election, in its sole discretion. Preferred Holder at its sole election may rescind this Agreement and return the Conversion Shares issued hereby (with stock powers medallion guaranteed) against the execution and delivery by SplashPM of the Preferred Stock replacement shares (the “Preferred Replacement Shares”) provided however if the Preferred Holder has not provided the Company with written notice of its intention to rescind within five business days following receipt of the Rescission Election Report then the Preferred Holder shall be deemed to have waived any rights to rescind under this Section and the right to rescind under this Section shall be null and void. To effect the rescission hereunder SplashPM shall promptly after receipt of the Rescission Election but in any event not more than five business days thereafter file with the Secretary of State of the State of Nevada the Certificates of Designations, Preferences and Rights of the Preferred Stock for each of the Series A and Series B Preferred Stock, in the forms attached hereto as Exhibit A , and Preferred Holder shall tender the Conversion Shares to SplashPM with an endorsed stock power against delivery by SplashPM of the Preferred Replacement Shares.

(h)       The Company covenants to Preferred Holder that no more than $500,000 of bridge loans, notes payable and other debt shall be outstanding as at the date of the Merger (“Permitted Existing Liabilities”) and that the maturity dates of the Permitted Existing Liabilities shall be no earlier than August , 2020. The Company shall cause all notes evidencing Permitted Existing Liabilities to convert into shares of common stock of SplashPM at a conversion price that will be the greater of (i) 1.25 per share (125% of the price for the conversion agreements that were executed as of the Merger) or (ii) the average of the reported closing price per share of SplashPM’s common stock taken over the three trading days prior to conversion. No holder of Permitted Existing Liabilities shall participate in or be awarded any New Capital Bonus Shares. Holders of Permitted Existing Liabilities shall not be granted or otherwise allowed registration or piggyback registration rights.

(i)       The Company and SplashPM covenant to provide piggyback registration rights to the Preferred Holder on terms not less favorable than those described in paragraph 3 above.

(j)       Should the Company or SplashPM provide note or debt or share conversion agreements solely with respect to the debt or note holders having outstanding debt as of the Merger to others on terms more favorable than those being accorded to Preferred Holder hereunder (“Changed Terms”), then this Agreement shall automatically be deemed to include and have the benefit of the Changed Terms. Notwithstanding the foregoing, Preferred Holder in its sole discretion may elect not to accept all of the Changed Terms within ten business days after Company and SplashPM have delivered notice of the Changed Terms to Preferred Holder.

6. Miscellaneous.

(a)        Governing Law and Venue. This Agreement and all acts and transactions pursuant hereto and the rights and obligations of the parties hereto shall be governed, construed and interpreted in accordance with the laws of the State of Nevada .The Company and Preferred Holder agree that all actions and proceedings arising out of or relating directly or indirectly to this Agreement or any ancillary agreement or any other related obligations shall be litigated solely and exclusively in the state or federal courts located in the City of Las Vegas, Clark County and that such courts are convenient forums. Each party hereby submits to the personal jurisdiction of such courts for purposes of any such actions or proceedings.

(b)        No modification, variation or amendment of this Agreement (including any exhibit hereto) shall be effective unless made in writing and signed by both parties. The failure by either party to enforce any rights under this Agreement shall not be construed as a waiver of any rights of such party.

(c)        Advice of Counsel. Each party to this Agreement hereby represents and warrants to the other party that it has had an opportunity to seek the advice of its own independent legal counsel with respect to the provisions of this Agreement and that its decision to execute this Agreement is not based on any reliance upon the advice of any other party or its legal counsel. Each party represents and warrants to the other party that in executing this Agreement such party has completely read this Agreement and that such party understands the terms of this Agreement and its significance. This Agreement shall be construed neutrally, without regard to the party responsible for its preparation.

(d)        Due Authorization Each party to this Agreement hereby represents and warrants to the other party that (i) the execution, performance and delivery of this Agreement has been authorized by all necessary action by such party; (ii) the representative executing this Agreement on behalf of such party has been granted all necessary power and authority to act on behalf of such party with respect to the execution, performance and delivery of this Agreement; and (iii) the representative executing this Agreement on behalf of such party is of legal age and capacity to enter into agreements which are fully binding and enforceable against such party.

  (e)       Further Assurances. The Company and Preferred Holder agree that in case at any time after the Merger any further action is necessary or desirable to carry out the purposes of this Agreement, each of the parties hereto will take such further action (including without limitation, the execution and delivery of such further instruments and documents) as any other party hereto may reasonably request.

(f)        Counterparts. This Agreement may be executed in any number of counterparts, all of which taken together shall constitute a single instrument.

(g)        Notices. All notices, requests and other communications hereunder shall be in writing and shall be delivered by courier or other means of personal service (including by means of a nationally recognized courier service or professional messenger service), or sent by facsimile or mailed first class, postage prepaid, by certified mail, return receipt requested, in all cases, addressed to:

If to Company:

       Splash Beverage Group, Inc.
       1314 E. Las Olas Blvd Suite #221
       Fort Lauderdale, Florida 33301
       Attention: Robert Nistico, Chief Executive Officer

With a copy to (which shall not constitute notice) notice):

      Sichenzia Ross Ference LLP
      1185 Avenue of the Americas, 37th Floor
      New York, New York 10036
      Attention: Darrin Ocasio, Esq.
      Email: dmocasio@srf.law

If to Preferred Holder:

       [ ]
       Attention: [X]

With a copy (which shall not constitute notice) to:

       [                                    ]

All notices, requests and other communications shall be deemed given on the date of actual receipt, delivery or refusal as evidenced by written receipt, acknowledgement or other evidence of actual receipt or delivery to the address specified above. In case of service by facsimile, a copy of such notice shall be personally delivered or sent by registered or certified mail, in the manner set forth above, within three business days thereafter. Any party hereto may from time to time by notice in writing served as set forth above designate a different address or a different or additional Person to which all such notices or communications thereafter are to be given. 

(h)       Attorneys’ Fees. In the event that any suit or action is instituted under or in relation to this Agreement, including without limitation to enforce any provision in this Agreement, the prevailing party in such dispute shall be entitled to recover from the losing party all fees, costs and expenses of enforcing any right of such prevailing party under or with respect to this Agreement, including without limitation, such reasonable fees and expenses of attorneys and accountants, which shall include, without limitation, all reasonable fees, costs and expenses of appeals

(i)       Remedies. All remedies afforded to any party by law or contract, shall be cumulative and not alternative and are in addition to all other rights and remedies a party may have, including any right to equitable relief and any right to sue for damages as a result of a breach of this Agreement. Without limiting the foregoing, no exercise of a remedy shall be deemed an election excluding any other remedy.

(j)       Successors and Assigns. The rights and benefits of this Agreement shall inure to the benefit of, and be enforceable by the Company's successors and assigns. The covenants and obligations of the Company hereunder shall inure to the benefit of, and be enforceable by the Preferred Holder against the Company, its successors and assigns, including any entity into which the Company is merged.

(k)       Survival. The representations, warranties, covenants and agreements made herein shall survive the closing of the transaction contemplated hereby. The representations, warranties, covenants and obligations of the Company, and the rights and remedies that may be exercised by the Preferred Holder, shall not be limited or otherwise affected by or as a result of any information furnished to, or any investigation made by or knowledge of, the Preferred Holder or any of its representatives.  

This Agreement is entered into and effective as of the date first written above.

Exhibit 10.4

THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND, ACCORDINGLY, MAY NOT BE TRANSFERRED UNLESS (I) SUCH SECURITIES HAVE BEEN REGISTERED FOR SALE PURSUANT TO THE SECURITIES ACT OF 1933, AS AMENDED, (II) SUCH SECURITIES MAY BE SOLD PURSUANT TO RULE 144, OR (111) THE COMPANY HAS RECEIVED AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO IT THAT SUCH TRANSFER MAY LAWFULLY BE MADE WITHOUT REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED.

PURSUANT TO THE TERMS OF SECTION 1 OF THIS WARRANT, ALL OR A PORTION OF THIS WARRANT MAY HAVE BEEN EXERCISED, AND THEREFORE THE ACTUAL NUMBER OF WARRANT SHARES REPRESENTED BY THIS WARRANT MAY BE LESS THAN THE AMOUNT SET FORTH ON THE FACE HEREOF.

Pursuant to an Agreement and Plan of Merger by and between Canfield Medical Supply Inc. (the “Company”) SBG Acquisition Inc. (the “Sub”), a wholly-owned subsidiary of the Company and Splash Beverage Group, Inc. (“Splash”), pursuant to which Sub will be merged into Splash (the “Merger”).

THIS WARRANT IS BEING ISSUED IN CONNECTION WITH THE MERGER AND REPLACES THE WARRANT THAT WAS ORIGINALLY ISSUED BY SPLASH TO THE HOLDER ON______________.

CANFIELD MEDICAL SUPPLY, INC

FORM OF WARRANT TO PURCHASE COMMON STOCK

Warrant No.: ______-__

Number of Shares of Common Stock: _______

Date of lssuance: February __, 2020 ("Issuance Date")

Canfield Medical Supply, Inc., a Colorado corporation (the "Company"), hereby certifies that, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged,____________, the registered holder hereof or its permitted assigns (the "Holder"), is entitled, subject to the terms set forth below, to purchase from the Company, at the Exercise Price (as defined below) then in effect, upon surrender of this Warrant to Purchase Common Stock (including any Warrants to Purchase Common Stock issued in exchange, transfer or replacement hereof, the "Warrant"), at any time or times on or after the Issuance Date, but not after 11:59 p.m., New York time, on the Expiration Date (as defined below), __________fully paid non-assessable shares of Common Stock (as defined below) (the "Warrant Shares"). Except as otherwise defined herein, capitalized terms in this Warrant shall have the meanings set forth in Section 15. This Warrant is one of a series of warrants containing substantially identical terms and conditions issued to purchasers in connection with a Unit Purchase Agreement dated, by and among the Company and the respective purchasers thereto (collectively, the "Warrants"). For avoidance of doubt, all Warrants issued in connection with the Unit Purchase Agreement, are considered one and the same series and are all "Warrants" hereunder.

1.                           EXERCISE OF WARRANT.

(a)                                                 Mechanics of Exercise. Subject to the terms and conditions hereof (including, without limitation, the limitations set forth in Section l(e)), this Warrant may be exercised by the Holder on any day on or after the Issuance Date, in whole or in part (but not as to fractional shares), by (i) delivery of a written notice, in the form attached hereto as Exhibit A (the "Exercise Notice"), of the Holder's election to exercise this Warrant and (ii) if the Holder is not electing a Cashless Exercise (as defined below) pursuant to Section 1(d) of this Warrant, payment to the Company of an amount equal to the applicable Exercise Price multiplied by the number of Warrant Shares as to which this Warrant is being exercised (the "Aggregate Exercise Price") in cash or wire transfer of immediately available funds (a "Cash Exercise") (the items under (i) and (ii) above, the "Exercise Delivery Documents"). The Holder shall not be required to surrender this Warrant in order to affect an exercise hereunder; provided, however, that in the event that this Warrant is exercised in full or for the remaining unexercised portion hereof, the Holder shall deliver this Warrant to the Company for cancellation within a reasonable time after such exercise. On or before the first Trading Day following the date on which the Company has received the Exercise Delivery Documents (the date upon which the Company has received all of the Exercise Delivery Documents, the "Exercise Date"), the Company shall transmit by facsimile or e-mail transmission an acknowledgment of confirmation of receipt of the Exercise Delivery Documents to the Holder and the Company's transfer agent for the Common Stock (the "Transfer Agent"). The Company shall deliver any objection to the compliance of Exercise Delivery Documents to the requirements hereof on or before the second Trading Day following the date on which the Company has received all of the Exercise Delivery Documents. On or before the second Trading Day following the date on which the Company has received all of the Exercise Delivery Documents (or, if later, the second Trading Day after the resolution of any reasonable objection by the Company to the Exercise Delivery Documents) (the "Share Delivery Date"), for any Cash Exercise or Cashless Exercise, the Company shall, provided that the Transfer Agent is participating in The Depository Trust Company ("DTC") Fast Automated Securities Transfer Program (the "FAST Program"), upon the request of the Holder, credit such aggregate number of shares of Common Stock to which the Holder is entitled pursuant to such exercise to the Holder's or its designee's balance account with OTC through its Deposit Withdrawal Agent Commission system; provided, however, if (i) the Transfer Agent is not participating in the FAST Program, (ii) a Cash Exercise is made and no effective registration statement for the resale of the Warrant Shares is available or (iii) a Cashless Exercise is made and the Warrant Shares cannot be sold without restriction under Rule 144 under the Securities Act of 1933, as amended , the Company shall issue and dispatch by overnight courier to the address as specified in the Exercise Notice, a certificate, registered in the Company's share register in the name of the Holder or its designee, for the number of shares of Common Stock to which the Holder is entitled pursuant to such exercise. Upon the delivery of the Exercise Delivery Documents (or, if the Company reasonably objects to the Exercise Delivery Documents, upon the resolution of such objection), the Holder shall be deemed for all corporate purposes to have become the holder of record of the Warrant Shares with respect to which this Warrant has been exercised, irrespective of the date such Warrant Shares are credited to the Holder's OTC account or the date of delivery of the certificates evidencing such Warrant Shares, as the case may be. If this Warrant is submitted in connection with any exercise pursuant to this Section l(a) and the number of Warrant Shares represented by this Warrant submitted for exercise is greater than the number of Warrant Shares being acquired upon an exercise, then the Company shall as soon as practicable and in no event later than three Trading Days after any such submission and at its own expense, issue a new Warrant (in accordance with Section 7(e)) representing the right to purchase the number of Warrant Shares purchasable immediately prior to such exercise under this Warrant, less the number of Warrant Shares with respect to which this Warrant has been and/or is exercised. The Company shall pay any and all taxes and other expenses of the Company (including overnight delivery charges) that may be payable with respect to the issuance and delivery of Warrant Shares upon exercise of this Warrant; provided, however, that the Company shall not be required to pay any tax which may be payable in respect of any transfer involved in the registration of any certificates for Warrant Shares or Warrants in a name other than that of the Holder or an affiliate thereof. The Holder shall be responsible for all other tax liability that may arise as a result of holding or transferring this Warrant or receiving Warrant Shares upon exercise hereof.

(b)                                               Exercise Price. For purposes of this Warrant, "Exercise Price" means $1.50, subject to adjustment as provided herein.

(c)                                                  Company's Failure to Timely Deliver Securities. If the Company shall fail for any reason or for no reason to issue to the Holder within three (3) Business Days of the Exercise Date a certificate for the number of shares of Common Stock to which the Holder is entitled and register such shares of Common Stock on the Company's share register or to credit the Holder's balance account with OTC for such number of shares of Common Stock to which the Holder is entitled upon the Holder's exercise of this Warrant, and if on or after such Trading Day the Holder, or any third party on behalf of the Holder or for the Holder's account, purchases (in an open market transaction or otherwise) shares of Common Stock to deliver in satisfaction of a sale by the Holder of shares of Common Stock issuable upon such exercise that the Holder anticipated receiving from the Company (a "Buy-In"), then the Company shall, within three (3) Business Days after the Holder's written request and in the Holder's discretion, either (i) pay cash to the Holder in an amount equal to the Holder's total purchase price (including brokerage commissions, if any) for the shares of Common Stock so purchased (the "Buy-In Price"), at which point the Company's obligation to deliver such certificate (and to issue such Warrant Shares) shall terminate, or (ii) promptly honor its obligation to deliver to the Holder a certificate or certificates representing such Warrant Shares and pay cash to the Holder in an amount equal to the excess (if any) of the Buy-In Price over the product of (A) such number of shares of Common Stock, times (B) the Closing Bid Price on the date of exercise.

(d)                                                Cashless Exercise. Notwithstanding anything contained herein to the contrary, from and after the date hereof, (while this warrant is outstanding and not terminated), the Holder may, in its sole discretion, exercise this Warrant in whole or in part and, in lieu of making the cash payment otherwise contemplated to be made to the Company upon such exercise in payment of the Aggregate Exercise Price, elect instead to receive upon such exercise the "Net Number" of shares of Common Stock determine according to the following formula (a "Cashless Exercise"):

Net Number= (Ax B) - (A x C)

B

For purposes of the foregoing formula:

A= the total number of shares with respect to which this Warrant is then being exercised.

B= the arithmetic average of the Closing Sale Prices of the shares of Common Stock for the five (5) consecutive Trading Days ending on the date immediately preceding the date of the Exercise Notice.

C= the Exercise Price then in effect for the applicable Warrant Shares at the time of such exercise.

(e)                                               Rule 144. For purposes of Rule 144(d) promulgated under the Securities Act, as in effect on the date hereof, assuming the Holder is not an affiliate of the Company, it is intended that the Warrant Shares issued in a Cashless Exercise shall be deemed to have been acquired by the Holder, and the holding period for the Warrant Shares shall be deemed to have commenced, on the Issuance Date.

(f)                                                Disputes. In the case of a dispute as to the determination of the Exercise Price or the arithmetic calculation of the Warrant Shares, the Company shall promptly issue to the Holder the number of Warrant Shares that are not disputed.

(g)                                                    Reserved.

2.                          ADJUSTMENT OF EXERCISE PRICE AND NUMBER OF WARRANT SHARES. The Exercise Price and the number of Warrant Shares shall be adjusted from time to time as follows:

(a)                                                Adjustment upon Subdivision or Combination of Common Stock. If the Company at any time on or after the Issuance Date subdivides (by any stock split, stock dividend, recapitalization, reorganization, scheme, arrangement or otherwise) one or more classes of its outstanding shares of Common Stock into a greater number of shares, the Exercise Price in effect immediately prior to such subdivision will be proportionately reduced and the number of Warrant Shares will be proportionately increased. If the Company at any time on or after the Issuance Date combines (by any stock split, stock dividend, recapitalization, reorganization, scheme, arrangement or otherwise) one or more classes of its outstanding shares of Common Stock into a smaller number of shares, the Exercise Price in effect immediately prior to such combination will be proportionately increased and the number of Warrant Shares will be proportionately decreased. Any adjustment under this Section 2(a) shall become effective at the close of business on the date the subdivision or combination becomes effective.

(b)                                                    Dilutive Issuances. If at any time after the Issuance Date other than in connection with the Merger, the Company shall issue or sell shares of Common Stock or Convertible Securities, without consideration or for a consideration per share less than the then-current Exercise Price, the Exercise Price shall be reduced, concurrently with such issue, as provided herein. Following any such dilutive sale or issuance, the Exercise Price shall be reduced to a price equal to one hundred percent (100%) of the price at which such shares of Common Stock are issued (or, in the case of Convertible Securities, the price at which the Common Stock issuable upon the exercise, conversion or exchange of such Convertible Securities is deemed issued).

(c)                                                   Other Events. If any event occurs of the type contemplated by the provisions of this Section 2 but not expressly provided for by such provisions (including, without limitation, the granting of stock appreciation rights or phantom stock rights), then the Company's Board of Directors will make an appropriate adjustment in the Exercise Price and the number of Warrant Shares so as to protect the rights of the Holder; provided that no such adjustment pursuant to this Section 2(b) will increase the Exercise Price or decrease the number of Warrant Shares as otherwise determined pursuant to this Section 2.

3.                            RIGHTS UPON DISTRIBUTION OF ASSETS.

(a)                                                 If the Company shall declare or make any dividend or other distribution of its assets (or rights to acquire its assets) to holders of shares of Common Stock, by way of return of capital or otherwise (including, without limitation, any distribution of cash, stock or other securities, property or options by way of a dividend, spin off, reclassification, corporate rearrangement, scheme of arrangement or other similar transaction) (a "Distribution"), at any time after the issuance of this Warrant, then, in each such case, the Holder shall be entitled to participate in such Distribution to the same extent that the Holder would have participated therein if the Holder had held the number of shares of Common Stock acquirable upon complete exercise of this Warrant (without regard to any limitations on exercise hereof, including without limitation, the Maximum Percentage) immediately before the date of which a record is taken for such Distribution, or, if no such record is taken, the date as of which the record holders of shares of Common Stock are to be determined for the participation in such Distribution (provided, however, to the extent that the Holder's right to participate in any such Distribution would result in the Holder exceeding the Maximum Percentage, then the Holder shall not be entitled to participate in such Distribution to such extent (or in the beneficial ownership of any shares of Common Stock as a result of such Distribution to such extent) and the portion of such Distribution shall be held in abeyance for the benefit of the Holder until such time, if ever, as its right thereto would not result in the Holder exceeding the Maximum Percentage.

4.                          PURCHASE RIGHTS; FUNDAMENTAL TRANSACTIONS.

(a)                                                Purchase Rights. In addition to any adjustments pursuant to Section 2 above, if at any time the Company grants, issues or sells any Options, Convertible Securities or rights to purchase stock, warrants, securities or other property pro rata to the record holders of any class of Common Stock (the "Purchase Rights"), then the Holder will be entitled to acquire, upon the terms applicable to such Purchase Rights, the aggregate Purchase Rights which the Holder could have acquired if the Holder had held the number of shares of Common Stock acquirable upon complete exercise of this Warrant (without regard to any limitations on the exercise of this Warrant) immediately before the date on which a record is taken for the grant, issuance or sale of such Purchase Rights, or, if no such record is taken, the date as of which the record holders of shares of Common Stock are to be determined for the grant, issue or sale of such Purchase Rights.

(b)                                               Fundamental Transactions. The Company shall not enter into or be party to a Fundamental Transaction unless (i) the Successor Entity assumes in writing (unless the Company is the Successor Entity) all of the obligations of the Company under this Warrant and the other Transaction Documents in accordance with the provisions of this Section (4)(b) pursuant to written agreements in form and substance reasonably satisfactory to the Required Holders and approved by the Required Holders prior to such Fundamental Transaction, including agreements to deliver to each holder of the Warrants in exchange for such Warrants a security of the Successor Entity evidenced by a written instrument substantially similar in form and substance to this Warrant, including, without limitation, an adjusted exercise price equal to the value for the shares of Common Stock reflected by the terms of such Fundamental Transaction, and exercisable for a corresponding number of shares of capital stock equivalent to the shares of Common Stock acquirable and receivable upon exercise of this Warrant (without regard to any limitations on the exercise of this Warrant) prior to such Fundamental Transaction, and reasonably satisfactory to the Required Holders and (ii) the Successor Entity (including its Parent Entity) is a publicly traded corporation whose common stock is quoted on or listed for trading on an Eligible Market. Upon the occurrence of any Fundamental Transaction, the Successor Entity shall succeed to, and be substituted for (so that from and after the date of such Fundamental Transaction, the provisions of this Warrant referring to the "Company" shall refer instead to the Successor Entity), and may exercise every right and power of the Company and shall assume all of the obligations of the Company under this Warrant with the same effect as if such Successor Entity had been named as the Company herein. Upon consummation of the Fundamental Transaction, the Successor Entity shall deliver to the Holder confirmation that there shall be issued upon exercise of this Warrant at any time after the consummation of the Fundamental Transaction, in lieu of the shares of Common Stock (or other securities, cash, assets or other property) issuable upon the exercise of the Warrant prior to such Fundamental Transaction, such shares of the publicly traded common stock or common shares (or its equivalent) of the Successor Entity (including its Parent Entity) which the Holder would have been entitled to receive upon the happening of such Fundamental Transaction had this Warrant been converted immediately prior to such Fundamental Transaction, as adjusted in accordance with the provisions of this Warrant. In addition to and not in substitution for any other rights hereunder, prior to the consummation of any Fundamental Transaction pursuant to which holders of shares of Common Stock are entitled to receive securities or other assets with respect to or in exchange for shares of Common Stock (a "Corporate Event"), the Company shall make appropriate provision to insure that the Holder will thereafter have the right to receive upon an exercise of this Warrant at any time after the consummation of the Corporate Event but prior to the Expiration Date, in lieu of shares of Common Stock (or other securities, cash, assets or other property) purchasable upon the exercise of this Warrant prior to such Corporate Event, such shares of stock, securities, cash, assets or any other property whatsoever (including warrants or other purchase or subscription rights) which the Holder would have been entitled to receive upon the happening of such Corporate Event had this Warrant been exercised immediately prior to such Corporate Event. Provision made pursuant to the preceding sentence shall be in a form and substance reasonably satisfactory to the Required Holders. The provisions of this Section 4(b) shall apply similarly and equally to successive Fundamental Transactions and Corporate Events and shall be applied without regard to any limitations on the exercise of this Warrant.

(c)                                               Applicability to Successive Transactions. The provisions of this Section shall apply similarly and equally to successive Fundamental Transactions and Corporate Events and shall be applied without regard to any limitations on the exercise of this Warrant.

5.                        NONCIRCUMVENTION. The Company hereby covenants and agrees that the Company will not, by amendment of its Certificate of Incorporation, Bylaws or through any reorganization, transfer of assets, consolidation, merger, scheme of arrangement, dissolution, issue or sale of securities, or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms of this Warrant, and will at all times in good faith comply with all the provisions of this Warrant and take all actions consistent with effectuating the purposes of this Warrant. Without limiting the generality of the foregoing, the Company (i) shall not increase the par value of any shares of Common Stock receivable upon the exercise of this Warrant above the Exercise Price e then in effect, (ii) shall take all such actions as may be necessary or appropriate in order that the Company may validly and leg ally issue fully paid and non-assessable shares of Common Stock upon the exercise of this Warrant, and (iii) shall, so long as this Warrant is outstanding, take all action necessary to reserve and keep available out of its authorized and unissued shares of Common Stock, solely for the purpose of effecting the exercise of this Warrant, 100% of the number of shares of Common Stock issuable upon exercise of this Warrant then outstanding (without regard to any limitations on exercise).

6.                             WARRANT HOLDER NOT DEEMED A STOCKHOLDER. Except as otherwise specifically provided herein, the Holder, solely in such Person's capacity as a holder of this Warrant, shall not be entitled to vote or receive dividends or be deemed the holder of share capital of the Company for any purpose, nor shall anything contained in this Warrant be construed to confer upon the Holder, solely in such Person's capacity as the Holder of this Warrant, any of the rights of a stockholder of the Company or any right to vote, give or withhold consent to any corporate action (whether any reorganization, issue of stock, reclassification of stock, consolidation, merger, conveyance or otherwise), receive notice of meetings, receive dividends or subscription rights, or otherwise, prior to the issuance to the Holder of the Warrant Shares which such Person is then entitled to receive upon the due exercise of this Warrant. In addition, nothing contained in this Warrant shall be construed as imposing any liabilities on the Holder to purchase any securities (upon exercise of this Warrant or otherwise) or as a stockholder of the Company, whether such liabilities are asserted by the Company or by creditors of the Company.

7.                           REISSUANCE OF WARRANTS.

(a)                                                Transfer of Warrant. If this Warrant is to be transferred, the Holder shall surrender this Warrant to the Company and deliver the completed and executed Assignment Form, in the form attached hereto as Exhibit B, whereupon the Company will forthwith issue and deliver upon the order of the Holder a new Warrant (in accordance with Section 7(d)), registered as the Holder may request, representing the right to purchase the number of Warrant Shares being transferred by the Holder and, if less than the total number of Warrant Shares then underlying this Warrant is being transferred, a new Warrant (in accordance with Section 7(d)) to the Holder representing the right to purchase the number of Warrant Shares not being transferred.

(b)                                                Lost, Stolen or Mutilated Warrant. Upon receipt by the Company of evidence reasonably satisfactory to the Company of the loss, theft, destruction or mutilation of this Warrant, and, in the case of loss, theft or destruction, of any indemnification undertaking by the Holder to the Company in customary form and, in the case of mutilation, upon surrender and cancellation of this Warrant, the Company shall execute and deliver to the Holder a new Warrant (in accordance with Section 7(d)) representing the right to purchase the Warrant Shares then underlying this Warrant.

(c)                                                Exchangeable for Multiple Warrants. This Warrant is exchangeable, upon the surrender hereof by the Holder at the principal office of the Company, for a new Warrant or Warrants (in accordance with Section 7(d)) representing in the aggregate the right to purchase the number of Warrant Shares then underlying this Warrant, and each such new Warrant will represent the right to purchase such portion of such Warrant Shares as is designated by the Holder at the time of such surrender; provided, however, that no Warrants for fractional shares of Common Stock shall be given. Notwithstanding anything to the contrary herein, in no event shall the original Warrant be subdivided into more than three (3) separate Warrants and such new Warrants shall not be further subdivided.

(d)                                               Issuance of New Warrants. Whenever the Company is required to issue a new Warrant pursuant to the terms of this Warrant, such new Warrant (i) shall be of like tenor with this Warrant, (ii) shall represent, as indicated on the face of such new Warrant, the right to purchase the Warrant Shares then underlying this Warrant (or in the case of a new Warrant being issued pursuant to Section 7(a) or Section 7(c). the Warrant Shares designated by the Holder which, when added to the number of shares of Common Stock underlying the other new Warrants issued in connection with such issuance, does not exceed the number of Warrant Shares then underlying this Warrant), (iii) shall have an issuance date, as indicated on the face of such new Warrant which is the same as the Issuance Date, and (iv) shall have the same rights and conditions as this Warrant.

8.                     NOTICES. Whenever notice is required to be given under this Warrant, unless otherwise provided herein, such notice shall be given in accordance with the Purchase Agreement.

9.                   AMENDMENT AND WAIVER. Except as otherwise provided herein, the provisions of this Warrant may be amended and the Company may take any action herein prohibited, or omit to perform any act herein required to be performed by it, only if the Company has obtained the written consent of the Required Holders; provided, that the number of Warrant Shares subject to this Warrant, the Exercise Price and the Expiration Date may not be amended, and the right to exercise this Warrant may not be altered or waived, without the written consent of the Holder. Any such amendment shall apply to all Warrants and be binding upon all registered holders of such Warrants, whether or not they have individually consented.

10.                GOVERNING LAW; CONSENT TO JUSRISDICTION. WAIVER OF JURY TRIAL. This Warrant shall be governed by, and construed in accordance with, the internal laws of the State of Florida, without reference to the choice of law provisions thereof. The Company and, by accepting this Warrant, the Holder, each irrevocably submits to the exclusive jurisdiction of the courts of the State of Florida and the United States District Court for the District of Florida for the purpose of any suit, action, proceeding or judgment relating to or arising out of this Warrant and the transactions contemplated hereby. Service of process in connection with any such suit, action or proceeding may be served on each party hereto anywhere in the world by the same methods as are specified for the giving of notices under this Warrant. The Company and, by accepting this Warrant, the Holder, each irrevocably consents to the jurisdiction of any such court in any such suit, action or proceeding and to the laying of venue in such court. The Company and, by accepting this Warrant, the Holder, each irrevocably waives any objection to the laying of venue of any such suit, action or proceeding brought in such courts and irrevocably waives any claim that any such suit, action or proceeding brought in any such court has been brought in an inconvenient forum. EACH OF THE COMPANY AND, BY ITS ACCEPTANCE HEREOF, THE HOLDER HEREBY WAIVES ANY RIGHT TO REQUEST A TRIAL BY JURY IN ANY LITIGATION WITH RESPECT TO THIS WARRANT AND REPRESENTS THAT COUNSEL HAS BEEN CONSULTED SPECIFICALLY AS TO THIS WAIVER.

11.                      CONSTRUCTION; HEADINGS. This Warrant shall be deemed to be jointly drafted by the Company and the Holder and shall not be construed against any person as the drafter hereof. The headings of this Warrant are for convenience of reference and shall not form part of, or affect the interpretation of, this Warrant.

12.                      DISPUTE RESOLUTION. In the case of a dispute as to the determination of the Exercise Price or the arithmetic calculation of the Warrant Shares, the Company shall submit the disputed determinations or arithmetic calculations via facsimile within two (2) Business Days of receipt of the Exercise Notice giving rise to such dispute, as the case may be, to the Holder. If the Holder and the Company are unable to agree upon such determination or calculation of the Exercise Price or the Warrant Shares within three Business Days of such disputed determination or arithmetic calculation being submitted to the Holder, then the Company shall, within two (2) Business Days submit via facsimile (a) the disputed determination of the Exercise Price to an independent, reputable investment bank selected by the Company and approved by the Holder, which approval shall not be unreasonably withheld, or (b) the disputed arithmetic calculation of the Warrant Shares to the Company's independent, outside accountant. The Company shall cause the investment bank or the accountant, as the case may be, to perform the determinations or calculations and notify the Company and the Holder of the results no later than ten Business Days from the time it receives the disputed determinations or calculations. The prevailing party in any dispute resolved pursuant to this Section 12 shall be entitled to the full amount of all reasonable expenses, including all costs and fees paid or incurred in good faith, in relation to the resolution of such dispute. Such investment bank's or accountant's determination or calculation, as the case may be, shall be binding upon all parties absent demonstrable error.

13.                REMEDIES, OTHER OBLIGATIONS, BREACHES AND INJUNCTIVE RELIEF. The remedies provided in this Warrant shall be cumulative and in addition to all other remedies available under this Warrant, at law or in equity (including a decree of specific performance and/or other injunctive relief), and nothing herein shall limit the right of the Holder to pursue actual damages for any failure by the Company to comply with the terms of this Warrant.

14.       TRANSFER. Subject to applicable law and the restrictions on transfer set forth in the Purchase Agreement, this Warrant may not be offered for sale, sold, transferred or assigned without the consent of the Company, such consent not to be unreasonably withheld or delayed.

15.       For purposes of this Warrant, the following terms shall have the following meanings:

(a)                 "Bloomberg" means Bloomberg Financial Markets.

(b)                 "Business Day" means any day other than Saturday, Sunday or other day on which commercial banks in The City of New York are authorized or required by law to remain closed.

(c)                 "Closing Bid Price" and "Closing Sale Price" means, for any security as of any date, the last closing bid price and last closing trade price, respectively, for such security on the Principal Market, as reported by Bloomberg, or, if the Principal Market begins to operate on an extended hours basis and does not designate the closing bid price or the closing trade price, as the case may be, then the last bid price or the last trade price, respectively, of such security prior to 4:00:00 p.m., New York time, as reported by Bloomberg, or, if the Principal Market is not the principal securities exchange or trading market for such security, the last closing bid price or last trade price, respectively, of such security on the principal securities exchange or trading market where such security is listed or traded as reported by Bloomberg, or if the foregoing do not apply, the last closing bid price or last trade price, respectively, of such security in the over-the-counter market on the electronic bulletin board for such security as reported by Bloomberg, or, if no closing bid price or last trade price, respectively, is reported for such security by Bloomberg, the average of the bid prices, or the ask prices, respectively, of any market makers for such security as reported in the "pink sheets" by Pink Sheets LLC (formerly the National Quotation Bureau, Inc.) . If the Closing Bid Price or the Closing Sale Price cannot be calculated for a security on a particular date on any of the foregoing bases, the Closing Bid Price or the Closing Sale Price, as the case may be, of such security on such date shall be the fair market value as mutually determined by the Company and the Holder. All such determinations to be appropriately adjusted for any stock dividend, stock split, stock combination or other similar transaction during the applicable calculation period.

(d)                 "Common Stock" means (i) the Company' s shares of Common Stock, par value

$0.001 per share, and (ii) any share capital into which such Common Stock shall have been changed or any share capital resulting from a reclassification of such Common Stock.

(e)                 "Convertible Securities" means any stock or securities (other than Options) directly or indirectly convertible into or exercisable or exchangeable for shares of Common Stock. "Eligible Market" means the Principal Market, the OTC Markets QB tier, The New York Stock Exchange, Inc., NYSE MKT, The NASDAQ Global Market, The NASDAQ Global Select Market, or The NASDAQ Capital Market.

(f)                  "Expiration Date" means _____________ or, if such date falls on a day other than a Trading Day or on which trading does not take place on the Principal Market, or, if the Principal Market is not the principal trading market for the Common Stock, then on the principal securities exchange or securities market on which the Common Stock is then traded (a "Holiday"), the next date that is not a Holiday.

(g)                 "Fundamental Transaction" means that the Company shall, directly or indirectly, in one or more related transactions, (i) consolidate or merge with or into (whether or not the Company is the surviving corporation) another Person (but excluding a migratory merger effected solely for the purpose of changing the jurisdiction of incorporation of the Company), or (ii) sell, assign, transfer, convey or otherwise dispose of all or substantially all of the properties or assets of the Company to another Person, or (iii) allow another Person to make a purchase, tender or exchange offer that is accepted by the holders of more than the 50% of the outstanding shares of Common Stock (not including any shares of Common Stock held by the Person or Persons making or party to, or associated or affiliated with the Persons making or party to, such purchase, tender or exchange offer), or (iv) consummate a stock purchase agreement or other business combination (including, without limitation, a reorganization, recapitalization, spin-off or scheme of arrangement) with another Person whereby such other Person acquires more than the 50% of the outstanding shares of Common Stock (not including any shares of Common Stock held by the other Person or other Persons making or party to, or associated or affiliated with the other Persons making or party to, such stock purchase agreement or other business combination), (v) reorganize, recapitalize or reclassify its Common Stock, or (vi) any "person" or "group" (as these terms are used for purposes of Sections 13(d) and 14(d) of the Exchange Act) is or shall become the "beneficial owner" (as defined in Rule l3d-3 under the Exchange Act), directly or indirectly, of 50% of the aggregate ordinary voting power represented by issued and outstanding Common Stock.

(i)            "Options" means any rights, warrants or options to subscribe for or purchase shares of Common Stock or Convertible Securities.

(j)                  "Parent Entity" of a Person means an entity that, directly or indirectly, controls the applicable Person and whose common stock or equivalent equity security is quoted or listed on an Eligible Market, or, if there is more than one such Person or Parent Entity, the Person or Parent Entity with the largest public market capitalization as of the date of consummation of the Fundamental Transaction.

(k)                "Person" means an individual, a limited liability company, a partnership, a joint venture, a corporation, a trust, an unincorporated organization, any other entity and a government or any department or agency thereof.

(l)                  “Principal Market” means the OTC Markets QB tier.

(m)              "Required Holders" means, as of any time of determination, the Holders of at least a majority of the Warrant Shares issuable upon exercise of all of the outstanding Warrants.

(n)                "Successor Entity" means the Person (or, if so elected by the Holder, the Parent Entity) formed by, resulting from or surviving any Fundamental Transaction or the Person (or, if so elected by the Holder, the Parent Entity) with which such Fundamental Transaction shall have been entered into.

(o)                "Trading Day" means any day on which the Common Stock are traded on the Principal Market, or, if the Principal Market is not the principal trading market for the Common Stock, then on the principal securities exchange or securities market on which the Common Stock are then traded; provided that "Trading Day" shall not include any day on which the Common Stock are scheduled to trade on such exchange or market for less than 4.5 hours or any day that the Common Stock are suspended from trading during the final hour of trading on such exchange or market (or if such exchange or market does not designate in advance the closing time of trading on such exchange or market, then during the hour ending at 4:00:00 p.m., New York time).

IN WITNESS WHEREOF, the Company has caused this Warrant to Purchase Common Stock to be duly executed as of the Issuance Date set out above.

CANFIELD MEDICAL SUPPLY, INC.

By:____________________________ 

Name: ____________________________

Title: ____________________________

EXHIBIT A

EXERCISE NOTICE

TO BE EXECUTED BY THE REGISTERED HOLDER TO EXERCISE THIS WARRANT TO PURCHASE COMMON STOCK

CANFIELD MEDICAL SUPPLY, INC.

The undersigned holder hereby exercises the right to purchase _ _ _ _ _ _ _ _ of the shares of Common Stock ("Warrant Shares") of Canfiled Medical Supply Inc., a Colorado corporation (the "Company"), evidenced by the attached Warrant to Purchase Common Stock (the "Warrant"). Capitalized terms used herein and not otherwise defined shall have the respective meanings set forth in the Warrant.

1.       Form of Exercise Price. The Holder intends that payment of the Exercise Price shall be made as:

a. “Cash Exercise” with respect to the Warrant Shares; and/or

b. “Cash-less Exercise” with respect to the Warrant Shares.

2. Payment of Exercise Price. In the event that the holder has elected a Cash Exercise with respect to some or all of the Warrant Shares to be issued pursuant hereto, the holder shall pay the Aggregate Exercise Price in the sum of$ to the Company in accordance with the terms of the

Warrant.

3.       Delivery of Warrant Shares. The Company shall deliver to the holder Warrant Shares in accordance with the terms of the Warrant and, after delivery of such Warrant Shares, the Warrant Shares remain subject to the Warrant.

Date:____________________________

By: ____________________________

(Name of Registered Holder)

Name:____________________________

Title: ____________________________

EXHIBITB

ASSIGNMENT FORM

CANFIELD MEDICAL SUPPLY INC.

(To assign the foregoing Warrant, execute this form and supply required information. Do not use this form to purchase shares.)

FOR VALUE RECEIVED, the foregoing Warrant and all rights evidenced thereby are hereby assigned to Name:

Address:

____________________________

____________________________

Dated: ___________, __________  

Holder's Signature:

____________________________

Holder's Address:

____________________________

____________________________

____________________________

NOTE: The signature to this Assignment Form must correspond with the name as it appears on the face of the Warrant, without alteration or enlargement or any change whatever. Officers of corporations and those acting in a fiduciary or other representative capacity should file proper evidence of authority to assign the foregoing Warrant.

Exhibit 10.5

THIS WARRANT AND THE SECUROITIES UNDERLYING THIS WARRANT HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT") OR THE SECURITIES LAWS OF ANY STATE, AND MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED, ASSIGNED OR HYPOTHECATED UNLESS (A) THERE IS AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT COVERING SUCH SECURITIES AND THERE IS FULL COMPLIANCE WITH THE APPLICABLE STATE SECURITIES LAWS, (B) THE SALE IS MADE IN ACCORDANCE WITH RULE 144 UNDER THE SECURITIES ACT OR (C) ____________, INC. (THE "CORPORATION") RECEIVES AN OPINION OF COUNSEL SELECTED BY THE HOLDER OF THE SECURITIES REASONABLY SATISFACTORY TO THE CORPORATION STATING THAT SUCH SALE IS EXEMPT FROM THE REGISTRATION AND PROSPECTUS DELIVERY REQUIREMENTS OF THE SECURITIES ACT AND COMPLIES WITH APPLICABLE STATE SECURITIES LAWS.

THIS WARRANT MAY NOT BE TRANSFERRED OR ASSIGNED BY THE REGISTERED HOLDER TO A NON-AFFILIATE OF THE HOLDER WITHOUT THE PRIOR WRITTEN CONSENT OF THE CORPORATION.

FORM OF COMMON STOCK PURCHASE WARRANT

FOR VALUE RECEIVED, _______________________________________________________

(the "Corporation"), hereby grants to _____________ or its registered assigns (the "Registered Holder") the right to purchase from the Corporation _______________ shares of Common Stock, par value $0.001_ per share ("Common Stock") of the Corporation (the "Warrant Stock") at a price of Twenty-Five Cents ($0.25) per share (the "Exercise Price") (subject to adjustment as provided herein) to such Registered Holder.

This Warrant is subject to the following provisions:

1.                   Exercise of Warrant.

A.                  Number of Shares. Subject to the terms and conditions hereinafter set forth, the Registered Holder is entitled, upon surrender of this Warrant, to purchase from the Corporation ________ shares of Warrant Stock (subject to adjustment as provided herein) at an exercise price of $_____ per share.

B.                  Exercise Period. The Registered Holder may exercise, in whole or in part, the purchase rights represented by this Warrant at any time and from time to time after the Date of Issuance through and including 5:30 p.m., Florida time, on the date that is the three year anniversary of the issuance of this Warrant (the "Expiration Date"). At 5:30 p.m., Eastern Standard Time , on the Expiration Date, the portion of this Warrant not exercised prior thereto shall be and become void and of no value and this Warrant shall be terminated and no longer outstanding.

C.                  Exercise Procedure.

(i)                  This Warrant or any part hereof specified by the Registered Holder shall be deemed to have been exercised at the time the Corporation receives all of the following items (the "Exercise Time"):

(a)               a completed Exercise Notice, as described in Section l(E) below, executed by the Person exercising all or part of the rights represented by this Warrant;

(b)               this Warrant; and

(c)               the aggregate Exercise Price for the number of shares of Warrant Stock being purchased through such exercise, such aggregate Exercise Price to be payable by check or a wire transfer in immediately available funds to the Corporation in an amount equal to the product of the Exercise Price multiplied by the number of shares of Warrant Stock being purchased with the proceeds of such check or wire transfer.

(ii)                      Certificates for shares of Warrant Stock purchased upon exercise of all or part of this Warrant shall be promptly delivered by the Corporation to the Registered Holder. Unless this Warrant has expired or all of the purchase rights represented hereby have been fully exercised, the Corporation shall prepare a new warrant certificate, substantially identical hereto, representing the rights formerly represented by this Warrant which have not expired or been exercised and shall promptly deliver such new Warrant to the Person designated for delivery in the Exercise Notice.

(iii)                    The Warrant Stock issuable upon the exercise of all or part of this Warrant shall be deemed to have been issued to the Registered Holder at the Exercise Time, and the Registered Holder shall be deemed for all purposes to have become the record holder of such Warrant Stock at the Exercise Time.

(iv)              Upon payment in full of the Exercise Price, each share of Warrant Stock issuable upon exercise of all or part of this Warrant shall be fully paid and nonassessable and free from all liens and charges with respect to the issuance thereof.

(v)                The Corporation shall at all times reserve and keep available out of its authorized but unissued shares of Common Stock such number of shares of Common Stock as are from time to time issuable upon the exercise of this Warrant.

D.                  Cashless Exercise. Notwithstanding any provisions herein to the contrary, if at any time after the Date of Issuance, there is no effective registration statement registering or no current prospectus available for the resale of the Warrant Stock and the fair market value of one (1) share of Warrant Stock is greater than the Exercise Price, in lieu of exercising this Warrant for cash, the Registered Holder may elect to receive Warrant Stock equal to the value (as determined below) of this Warrant (or the portion thereof being canceled) by surrender of this Warrant at the principal office of the Corporation together with the properly executed subscription form and notice of such election in which event the Corporation shall issue to the Holder a number of shares of Warrant Stock computed using the following formula:

X= Y(A-B)

     A

Where X = the number of shares of Warrant Stock issued to the Registered Holder.

Y = the number ofshares of Warrant Stock purchasable under the Warrant or, if only a portion of the Warrant is being exercised, the portion of the Warrant being canceled (at the date of such calculation).

A = the fair market value of one share of Common Stock of the Corporation (at

the date of such calculation) B = Exercise Price

For purposes of the above calculation, the fair market value of one share of Common Stock shall be (i) the last reported sale price of the Common Stock or the closing price quoted on the Nasdaq, NYSE, or OTC Markets, as published in The Wall Street Journal for the five (5) trading days prior to the date of determination of fair market value, or (ii) the fair market value of one share of Common Stock as determined in good faith by the Corporation's Board of Directors.

E. Exercise Notice. Upon any exercise of all or part of this Warrant, the Exercise Notice shall be substantially in the form set forth in Exhibit A hereto. Such Exercise Notice shall be dated the actual date of execution thereof.

2.                   Definitions. The following terms have meanings set forth below:

A.                "Date of lssuance" means the date of initial issuance of this Warrant (as of immediately after such issuance) regardless of the number of times new certificates representing the unexpired and unexercised rights formerly represented by this Warrant shall be issued.

B.                 "Person" means an individual, a partnership, a joint venture, a corporation, a trust, an unincorporated organization and a government or any department or agency thereof.

C.                 "Registered Holder" with respect to this Warrant means the Person who is reflected as the holder thereof on the register maintained by the Corporation.

3.                   No Rights; Limitations of Liability. Prior to the exercise of this Warrant and except as otherwise specifically provided herein or in the Agreement, this Warrant shall not entitle the Registered Holder hereof to any rights as a stockholder of the Corporation.

4.                   Replacement. Upon receipt of evidence reasonably satisfactory to the Corporation (an affidavit of the Registered Holder shall be satisfactory) of the loss, theft, destruction or mutilation of any certificate evidencing this Warrant, and in the case of any such loss, theft or destruction, upon receipt of an indemnity reasonably satisfactory to the Corporation, or in the case of any such mutilation, upon surrender and cancellation of such certificate, the Corporation shall (at its expense) execute and deliver in lieu of such certificate a new certificate of like tenor and dated the date of such lost, stolen, destroyed or mutilated certificate.

5.                   Legend. The certificates representing shares of Warrant Stock issued upon exercise of the Warrants (unless at the time of exercise such Warrant Stock are acquired pursuant to a registration statement that has been declared effective under the Securities Act) and applicable blue sky laws, shall bear a legend substantially as follows:

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

6.                   Charges, Taxes and Expenses. Issuance and delivery of certificates for representing shares of Warrant Stock upon exercise of this Warrant shall be made without charge to the Registered Holder for any issue or transfer tax, transfer agent fee or other incidental tax or expense in respect of the issuance of such certificates, all of which taxes and expenses shall be paid by the Corporation; provided, however, that the Corporation shall not be required to pay any tax that may be payable in respect of any transfer involved in the registration of any certificates for shares of Warrant Stock or the Warrant in a name other than that of the Registered Holder. The Registered Holder shall be responsible for all other tax liability that may arise as a result of holding or transferring this Warrant or receiving shares of Warrant Stock upon exercise hereof.

7.                   Certain Adjustments. The Exercise Price and number of shares of Warrant Stock issuable upon exercise of this Warrant are subject to adjustment from time to time as set forth in this Section 7.

(a)               Stock Dividends and Splits. If the Corporation, at any time while this Warrant is outstanding, (i) pays a stock dividend on its Common Stock or otherwise makes a distribution on any class of capital stock that is payable in shares of Common Stock, (ii) subdivides its outstanding shares of Common Stock into a larger number of shares, or (iii) combines its outstanding shares of Common Stock into a smaller number of shares, then in each such case the Exercise Price shall be adjusted to a price determined by multiplying the Exercise Price in effect immediately prior to the effective date of such event by a fraction, the numerator of which shall be the number of shares of Common Stock outstanding on such effective date immediately before giving effect to such event and the denominator of which shall be the number of shares of Common Stock outstanding immediately after giving effect to such event. Any adjustment made pursuant to clause (i) of this paragraph shall become effective immediately after the record date for the determination of stockholders entitled to receive such dividend or distribution, and any adjustment pursuant to clause (ii) or (iii) of this paragraph shall become effective immediately after the effective date of such subdivision, combination or reclassification.

(b)               Fundamental Transactions. Other than with respect to a merger or reverse merger with Canfield Medical Supply, Inc. if, at any time while this Warrant is outstanding, (i) the Corporation effects (A) any merger of the Corporation with (but not into) another Person, in which stockholders of the Corporation immediately prior to such transaction own less than a majority of the outstanding stock of the surviving entity, or (B) any merger or consolidation of the Corporation into another Person, (ii) the Corporation effects any sale of all or substantially all of its assets in one or a series of related transactions, (iii) any tender offer or exchange offer approved or authorized by the Corporation's Board of Directors is completed pursuant to which holders of at least a majority of the outstanding Common Stock tender or exchange their shares for other securities, cash or property, or (iv) the Corporation effects any reclassification of the Common Stock or any compulsory share exchange pursuant to which the Common Stock is effectively converted into or exchanged for other securities, cash or property (other than as a result of a subdivision or combination of shares of Common Stock covered by Section 7(a) above) (in any such case, a "Fundamental Transaction"), then the Registered Holder shall have the right thereafter to receive, upon exercise of this Warrant, the same amount and kind of securities, cash or property as it would have been entitled to receive upon the occurrence of such Fundamental Transaction if it had been, immediately prior to such Fundamental Transaction, the holder of the number of shares of Warrant Stock then issuable upon exercise in full of this Warrant without regard to any limitations on exercise contained herein (the "Alternate Consideration"), and the Registered Holder shall no longer have the right to receive shares of Warrant Stock upon exercise of this Warrant. For avoidance of doubt this Section shall not apply to any transaction with Canfield Medical Supply, Inc. including any merger, reverse merger or other transaction pursuant to which the Company becomes a subsidiary of Canfield Medical Supply, Inc.

(c)               Number of Warrant Shares. Simultaneously with any adjustment to the Exercise Price pursuant to paragraph (a) of this Section 7, the number of shares of Warrant Stock that may be purchased upon exercise of this Warrant shall be increased or decreased proportionately, so that after such adjustment the aggregate Exercise Price payable hereunder for the increased or decreased number of shares of Warrant Stock shall be the same as the aggregate Exercise Price in effect immediately prior to such adjustment.

(d)               Calculations. All calculations under this Section 7 shall be made to the nearest cent or the nearest share, as applicable. The number of shares of Common Stock outstanding at any given time shall not include shares owned or held by or for the account of the Corporation.

(e)               Notice of Adjustments. Upon the occurrence of each adjustment pursuant to this Section 7, the Corporation at its expense will, at the written request of the Registered Holder, promptly compute such adjustment, in good faith, in accordance with the terms of this Warrant and prepare a certificate setting forth such adjustment, including a statement of the adjusted Exercise Price and adjusted number or type of shares of Warrant Stock or other securities issuable upon exercise of this Warrant (as applicable), describing the transactions giving rise to such adjustments and showing in reasonable detail the facts upon which such adjustment is based. Upon written request, the Corporation will promptly deliver a copy of each such certificate to the Registered Holder and to the Corporation' s transfer agent.

(f)                Reserved.

8.                   No Fractional Shares. No fractional shares of Warrant Stock will be issued in connection with any exercise of this Warrant. In lieu of any fractional shares that would otherwise be issuable, the number of shares of Warrant Stock to be issued shall be rounded up to the next whole number.

9.                   Notices. Except as otherwise expressly provided herein, all notices referred to in this Warrant shall be in writing and shall be delivered personally, sent by reputable express courier service (charges prepaid) or sent by registered or certified mail, return receipt requested, postage prepaid and shall be deemed to have been given when so delivered, sent or deposited in the

U.S. Mail (i) to the Corporation, at its principal executive offices with a copy by email to ___________ (which shall not constitute notice) and (ii) to the Registered Holder of this Warrant, at such holder's address as it appears in the records of the Corporation (unless otherwise indicated by any such holder).

10.               Restrictions on Transfer.

(a)                The Registered Holder represents, by accepting this Warrant that it understands that this Warrant and any securities obtainable upon exercise of this Warrant have not been registered for sale under Federal or state securities laws and are being offered and sold to the Registered Holder pursuant to one or more exemptions from the registration requirements of such securities laws. Certificates representing Warrant Stock must bear the restrictive legend set forth herein. The Registered Holder understands that the Registered Holder must bear the economic risk of such Registered Holder's investment in this Warrant and any Warrant Stock or other securities obtainable upon exercise of this Warrant for an indefinite period of time, as this Warrant and such Warrant Stock or other securities have not been registered under Federal or state securities laws and therefore cannot be sold unless subsequently registered under such laws, or an exemption from such registration is available.

(b)               The Registered Holder, by such Registered Holder's acceptance of this Warrant, represents to the Corporation that such Registered Holder is acquiring this Warrant and will acquire any Warrant Stock or other securities obtainable upon exercise of this Warrant for such Registered Holder's own account for investment and not with a view to, or for sale in connection with, any distribution thereof in violation of the Securities Act. The Registered Holder agrees that this Warrant will not be sold or otherwise transferred unless (i) a registration statement with respect to such transfer is effective under the Securities Act of 1933, as amended (the "Securities Act") or (ii) such sale or transfer is made pursuant to one or more exemptions from the Securities Act, and (iii) such sale or transfer to a non-affiliate of the Registered Holder is approved by the prior written consent of the Corporation. The Registered Holder agrees the Warrant Stock will not be sold or otherwise transferred unless (i) a registration statement with respect to such transfer is effective under the Securities Act or (ii) such sale or transfer is made pursuant to one or more exemptions from the Securities Act.

(c)                The Corporation shall not effect any exercise of this Warrant, and the Holder shall not have the right to exercise any portion of this Warrant, pursuant to Section 1 or otherwise, to the extent that after giving effect to such issuance after exercise as set forth on the applicable Exercise Notice, the Holder (together with the Holder’s affiliates, and any other person or entity acting as a group together with the Holder or any of the Holder’s affiliates), as set forth on the applicable Exercise Notice, would beneficially own in excess of the Beneficial Ownership Limitation (as defined below). For purposes of the preceding sentence, the number of shares of Common Stock beneficially owned by the Holder and its affiliates shall include the number of shares of Common Stock issuable upon exercise of this Warrant with respect to which such determination is being made, but shall exclude the number of shares of Common Stock which would be issuable upon (1) exercise of the remaining, nonexercised portion of this Warrant beneficially owned by the Holder or any of its affiliates and (2) exercise, conversion, or exchange of the unexercised, unconverted, or non-exchanged portion of any other securities of the Corporation (including, without limitation, any other warrants) subject to a limitation on conversion, exercise, or exchange analogous to the limitation contained herein beneficially owned by the Holder or any of its affiliates. Except as set forth in the preceding sentence, for purposes of this Section, beneficial ownership shall be calculated in accordance with Section 13(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and the rules and regulations promulgated thereunder, and the determination of whether a person or entity is an “affiliate” of the Holder shall also be made in accordance with the Exchange Act, the Securities Act of 1933, as amended (the “Securities Act”), and the rules and regulations under such acts. To the extent that the limitation contained in this Section applies, the determination of whether this Warrant is exercisable (in relation to other securities owned by the Holder together with any affiliates) and of which a portion of this Warrant is exercisable shall be in the sole discretion of the Holder, and the submission of a Notice of Exercise shall be deemed to be the Holder’s determination of whether this Warrant is exercisable (in relation to other securities owned by the Holder together with any affiliates) and of which portion of this Warrant is exercisable, in each case subject to such aggregate percentage limitation, and the Corporation shall have no obligation to verify or confirm the accuracy of such determination. In addition, a determination as to any group status as contemplated above shall be determined in accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder. For purposes of this Section, in determining the number of outstanding shares of Common Stock, the Holder may rely on the number of outstanding shares of Common Stock as reflected in (x) the Corporation’s most recent Form 10-Q report or Form 10-K report, as the case may be, (y) a more recent public announcement by the Corporation, or (z) any other notice by the Corporation or the Corporation’s transfer agent setting forth the number of shares of Common Stock outstanding. Upon the written or oral request of the Holder, the Corporation shall within one trading day confirm orally and in writing to the Holder the number of shares of Common Stock then outstanding. In any case, the number of outstanding shares of Common Stock shall be determined after giving effect to the conversion or exercise of securities of the Corporation, including this Warrant, by the Holder or its affiliates since the date as of which such number of outstanding shares of Common Stock was reported. The “Beneficial Ownership Limitation” shall be 4.99% of the number of shares of Common Stock outstanding immediately after giving effect to the issuance of shares of Common Stock issuable upon exercise of this Warrant. The provisions of this paragraph shall be construed and implemented in a manner otherwise than in strict conformity with the terms of this Section to correct this paragraph (or any portion hereof) which may be defective or inconsistent with the intended Beneficial Ownership Limitation herein contained or to make changes or supplements necessary or desirable to properly give effect to such limitation. The limitations contained in this paragraph shall apply to a successor holder of this Warrant.

(d)               Notwithstanding the provisions of the immediately preceding paragraph, the Holder, upon not less than sixty-one days’ prior written notice to the Corporation, may elect (1) to change the Beneficial Ownership Limitation to 9.9% of the number of shares of Common Stock outstanding immediately after giving effect to the issuance of shares of Common Stock issuable upon exercise of this Warrant or (2) to eliminate the Beneficial Ownership Limitation in its entirety.

11.               Amendment. Except as expressly provided herein, neither this Warrant nor any term hereof may be amended, waived, discharged or terminated other than by a written instrument signed by the Board of Directors of the Corporation and the holders of at least a majority of the aggregate principal amount outstanding under the Notes.

12.               Successors and Assigns. Subject to the restrictions on transfer set forth in this Warrant, and compliance with applicable securities laws, and provided that the Registered Holder surrenders this Warrant along with any other appropriate documentation or legal opinions that he Corporation may request, this Warrant may be assigned by the Registered Holder.

13.               Descriptive Headings: Governing Law. The descriptive headings of the several Sections and paragraphs of this Warrant are inserted for convenience only and do not constitute a part of this Warrant. All questions concerning the construction, validity and interpretation of this Warrant shall be governed by and construed and enforced in accordance with the laws of the State of Florida, without giving effect to any choice of law or conflict provision or rule that would cause the application of the laws of any jurisdiction other than the State of Florida.

IN WITNESS WHEREOF, the Corporation executed this Warrant as of the Date of Issuance hereof.

By:                                                            

Name:                                                        

Title:                                                        

EXHIBIT A

EXERCISE NOTICE

The undersigned, pursuant to the provisions set forth in the attached Warrant (Warrant No. W-___, hereby agrees to subscribe for the purchase of shares of the Warrant Stock covered by such Warrant and makes payment in full at the price per share provided by such Warrant.

The undersigned requests that certificates for such shares be issued in the name of, and delivered to:

(Name)

(Address)

 (Signature and Date)

(Signature must conform in all respects to name of

holder as specified on the face of the Warrant)

 (Insert Social Security Number or EIN)