EXISTING SAMPLES PURCHASE AGREEMENT

EXISTING SAMPLES PURCHASE AGREEMENT

THIS EXISTING SAMPLES PURCHASE AGREEMENT is made as of the 12th day of October, 2006 between CorCell, Inc., a Delaware corporation (the “Seller) and Cord Blood America, Inc., a Florida corporation (the “Buyer”).

BACKGROUND

The Seller is engaged in the business of retrieving and storing cord blood samples for individuals. Simultaneously with the execution and delivery of this Agreement, pursuant to an Asset Purchase Agreement dated September 22, 2006 (the “Asset Purchase Agreement”), the Seller is selling to Buyer and the Buyer is purchasing from the Seller, all of Seller’s assets utilized in the business of retrieving cord blood samples. The Buyer desires to purchase from the Seller and the Seller desires to sell to the Buyer, all of Seller’s assets used in the Seller’s business of storage of cord blood samples (the “Acquired Business”).

The Seller desires to sell to the Buyer, and the Buyer desires to purchase from the Seller, the Acquired Assets of Seller on the terms and conditions hereinafter set forth.

Capitalized terms used and not otherwise defined herein shall have the meanings set forth in Section 15 hereof.

NOW, THEREFORE, in consideration of the premises and the mutual covenants hereinafter set forth and other good and valuable consideration, the receipt and sufficiency of which is acknowledged, the parties hereto agree as follows:

AGREEMENT

SALE AND PURCHASE OF ASSETS.

(a)

Sale and Purchase of Assets. The Seller shall sell, assign, transfer, convey and deliver to the Purchaser, at the Closing, good and valid title to the Acquired Assets, free and clear of any Encumbrances, on the terms and subject to the conditions set forth in this Agreement. For purposes of this Agreement, “Acquired Assets” means:.

(i)

all rights to possession and custody of all Acquired Samples;

(ii)

all rights of the Seller under the Contracts with each of the clients with respect to the Acquired Samples;

(iii)

copies of all Records;; and

(iv)

the Acquired Assets set forth on Schedule 1(a) hereto.

(b)

Excluded Assets. Notwithstanding anything herein to the contrary, all the assets of the Seller not specifically included in the Acquired Assets (the “Excluded Assets”) shall not be sold or transferred hereunder, shall be excluded from the definition of Acquired Assets and

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shall remain the property of the Seller. The Excluded Assets shall include, but are not limited to, the following::

(i)

All cash and accounts receivable of Seller at Closing; and

(ii)

The minute books, stock books and accounting records of Seller.

(c)

The sale of the Assets as herein contemplated shall be effected by such bills of sale, endorsements, assignments, drafts, checks, deeds and other instruments of transfer, conveyance and assignment as shall be necessary or appropriate to transfer, convey and assign the Acquired Assets to Buyer on the Closing Date as contemplated by this Agreement and as shall be reasonably requested by Buyer.

(d)

Seller shall, at any time and from time to time after the Closing Date, execute and deliver such further instruments of transfer and conveyance and do all such further acts as may be reasonably requested by Buyer to transfer, convey, assign and deliver to Buyer, or to aid and assist Buyer in collecting and reducing to possession, any and all of the Acquired Assets, or to vest in Buyer good, valid and marketable title to the Acquired Assets.

(e)

Subject to any confidentiality obligations or applicable privileges (including, without limitation, the attorney-client privilege), for a period of three (3) years after the Closing Date, at reasonable times and upon reasonable notice, Seller and its authorized representatives shall have, and Buyer shall afford Seller and its Representatives Records conveyed to Buyer hereunder for tax purposes or in connection with claims related to Excluded Assets and Excluded Liabilities only, and Buyer and its Representatives shall have, and Seller shall afford Buyer and its Representatives, access to any minute books, stock books and similar corporate records and accounting records retained by Seller pursuant to Section 1(b) of this Agreement.

(f)

Effective upon the Closing Date, Seller hereby irrevocably constitutes and appoints Buyer, its successors and assigns, the true and lawful attorney of Seller with full power of substitution, in the name of Buyer, or in the name of Seller, on behalf of and for the benefit of Buyer, to collect all items being transferred, conveyed and assigned to Buyer as part of the Acquired Assets, to institute and prosecute, in the name of Seller, or otherwise, all proceedings which Buyer may deem proper in order to collect, assert or enforce any claim, right or title of any kind in or to the Acquired Assets, and to do all such other acts in relation thereto as Buyer may deem advisable. Seller agrees that the foregoing powers are coupled with an interest and shall be irrevocable by Seller directly or indirectly by the dissolution or liquidation of Seller or in any manner or for any reason.

(g)

Sales Taxes. The Seller shall bear and pay one hundred percent (100%) of any sales taxes, use taxes, transfer taxes, documentary charges, recording fees or similar taxes, charges, fees or expenses that may become payable in connection with the sale and transfer of the Acquired Assets to the Buyer. The parties hereto shall cooperate with each other and use commercially reasonable efforts to minimize any of the aforementioned Taxes, charges, fees or

expenses including but not limited to the transfer of all software by remote electronic transmission.

ASSUMPTION OF LIABILITIES

(a)

Subject to the performance by the parties hereto of their respective obligations hereunder, on the Closing Date, simultaneously with the sale, conveyance and assignment of the Acquired Assets by Seller to Buyer, Buyer shall assume and shall pay or cause to be paid or otherwise discharged when due, subject to the limitations contained herein, the liabilities and obligations listed on Schedule 2 only, including the obligation to perform all services to be rendered to clients related to the Deferred Revenue Account (collectively, the “Assumed Obligations”).

(b)

Buyer shall not assume any liabilities or obligations of Seller whatsoever (the “Excluded Liabilities”) other than the Assumed Obligations, including, without limitation, any liability arising directly or indirectly out of the PharmaStem Litigation, the Real Property Lease or the Acquired Sample Transfer, except for the reimbursement obligations of Buyer set forth in Section 10(n) below..

PURCHASE PRICE.

(a)

In consideration of the transfer, conveyance and assignment of the Acquired Assets, and the assumption of the Assumed Obligations, Buyer shall pay the following purchase price (the “Purchase Price”) to Seller at Closing:

(i)

One Million Nine Hundred Fifty Thousand Dollars ($1,950,000) in immediately available funds (the “Cash Consideration”); and

(ii)

an aggregate number of shares of the common stock of Buyer, par value $.0001 per share (“Common Stock”), determined by dividing (i) $1,820,000 by (ii) the average of the closing sales prices of Common Stock as reported by the OTCBB for the fifteen (15) consecutive trading days ending on the business day prior to the date of this Agreement rounded down to the nearest whole number (the “Stock Consideration”); provided, however, that the maximum number of shares of Common Stock to be issued by Buyer shall be 22,750,000 and the minimum number of shares of Common Stock to be issued by Buyer shall be 15,166,666. Buyer shall make such payment of the Stock Consideration by causing the transfer agent for the Common Stock to credit such shares to the account of Seller at a brokerage firm to be designated in writing by Seller to Buyer not less than five business days prior to the Closing date.

(b)

The Cash Consideration and Stock Consideration, together with the Assumed Obligations, shall be allocated among the Assets as set forth on Schedule 3(b). Each of Seller and Buyer shall file Forms 8594 with the Internal Revenue Service consistent with such allocation.

(c)

The Purchase Price shall be adjusted at Closing, pro rata between the Cash Consideration and the Stock Consideration by (i) increasing the Purchase Price by the amount of

rent and utilities paid by Seller with respect to the space occupied by Buyer pursuant to the Sublease between Buyer and Seller dated September 29, 2006, for the period beginning on October 1, 2006 and ending on the Closing Date (estimated to be approximately $11,350 per month) , and (ii) decreasing the Purchase Price by the amount of gross profit earned by Seller (as shown in Seller’s statements of income and loss for the Acquired Business) with respect to the Acquired Samples for the period beginning on the date of this Agreement and ending on the Closing Date (estimated to be approximately $60,000 per month.).

CLOSING; CLOSING DATE.

(a)

The closing of the transactions contemplated by this Agreement (the “Closing”) shall take place within five business days after the closing of the Financing necessary for the Buyer to pay the Cash Consideration, but in no event later than March 31, 2007, unless extended by mutual agreement of the parties hereto (the “Closing Date”) at 10:00 a.m. local time at the offices of Xxxxxxxx Xxxxxx LLP, 3200 Mellon Bank Center, 0000 Xxxxxx Xxxxxx, Xxxxxxxxxxxx, Xxxxxxxxxxxx 00000, or such other time and place that are mutually acceptable to the Seller and the Buyer.

(b)

At the Closing:

(i)

the Seller shall execute and deliver a Xxxx of Sale, in the form of Exhibit A attached hereto (the “Xxxx of Sale”);

(ii)

the Buyer shall pay the Purchase Price and deliver the Stock Consideration to the Seller; and

(iii)

the Buyer and Seller shall execute and deliver a general Assignment and Assumption Agreement in the form of Exhibit B attached hereto (the “Assignment and Assumption Agreement”).

(c)

Post-Closing Transfers. Following the Closing, the parties shall cooperate with each other to identify any assets that were not designated as part of the Acquired Assets at the Closing but which are necessary to conduct the Acquired Business as currently being conducted by the Seller (the “Nontransferred Assets”). To the extent any Nontransferred Assets are identified and the Seller is legally and contractually permitted to transfer such assets, the Seller shall, at no cost to the Buyer, promptly take all actions to transfer such Nontransferred Assets to the Buyer. In the event the Seller is required to obtain the consent or approval of any Person prior to the transfer of any Nontransferred Asset, then the Seller shall, at its own expense, use its commercially reasonable efforts to promptly obtain such approval or consent, and upon obtaining such approval or consent, shall promptly transfer such Nontransferred Asset to the Buyer. In the event the Seller is unable to obtain such approval or consent, then the Seller and the Buyer shall discuss in good faith an appropriate resolution for the transfer of the economic benefit of such Nontransferred Asset to the Buyer.

(d)

Post-Closing Funds. If, following the Closing, (i) the Seller receives any payment or proceeds with respect to any Acquired Asset sold or transferred hereunder, the Seller shall promptly remit the proceeds or payments to the Buyer, and (ii) the Buyer receives any payment or proceeds with respect to any Excluded Assets, the Buyer shall promptly remit the proceeds or payments to the Seller.

(e)

Other Post-Closing Adjustments. On each of the first 6 monthly anniversary dates after the Closing Date, the parties shall exchange any information required for them to pay to each other the amounts of any assets or expenses the respective amounts of which were not ascertainable as of the Closing Date, and which are properly attributable to the other party.

REPRESENTATIONS AND WARRANTIES OF THE SELLER.

The Seller represents and warrants to the Buyer as follows, except as set forth in the disclosure schedules delivered by the Seller to the Buyer concurrently with the execution of this Agreement (“Schedules”) (it being agreed that disclosure in the Schedules with respect to any particular section of the Agreement shall be deemed disclosure with respect to another section of the Agreement only to the extent the applicability of such disclosure to the subject matter of such other section is reasonably clear or apparent from a reading of such disclosure in the Schedules in conjunction with such other section of the Agreement):

(a)

Organization of Seller. The Seller is a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware. The Seller has all requisite corporate power and authority to own, operate and lease its properties and to carry on its business as now being conducted. The Seller is duly qualified or licensed and in good standing to do business in each jurisdiction in which the property owned, leased or operated by it or the nature of the business conducted by it makes such qualification necessary, except where the failure to be so qualified or licensed and in good standing, individually or in the aggregate, would not have a Material Adverse Effect on the Seller.

(b)

Intentionally Omitted.

(c)

Authority and Enforceability of Agreements. The Seller has all requisite corporate power and authority to execute and deliver this Agreement and to consummate the transactions contemplated hereby. This Agreement has been duly authorized and executed by the Seller and constitutes the valid and binding obligation of the Seller enforceable against the Seller in accordance with its terms, except as such enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or other similar laws, now or hereinafter in effect, relating to creditors' rights generally and to general principles of equity.

(d)

Consents. Except as set forth in Schedule 5(d), neither the execution and delivery of this Agreement by the Seller nor the consummation by the Seller of the transactions contemplated by this Agreement will require any Consent of, any Governmental Body or other Person.

(e)

Non-Contravention. The execution and delivery of this Agreement by the Seller and the consummation by the Seller of the transactions contemplated hereby will not (i) violate any provision of any statute, law, regulation, rule, injunction, judgment, order, decree, ruling or other restriction of any Governmental Body to which the Seller is subject, (ii) contravene or result in a violation of any corporate charter document or by-law of the Seller, (iii) conflict with or result in any violation or breach of any of the terms, conditions or provisions of, or constitute a default under any Contract, or result in the creation of any Encumbrance upon, or (iv) give any Person the right to (a) declare a default or exercise any remedy under any Contract, (b) accelerate the maturity or performance of any Contract, or (c) cancel, terminate or materially modify any Contract.

(f)

Corporate Documents. True and correct copies of the Certificate of Incorporation and Bylaws of the Seller, as currently in effect, have been furnished to the Buyer.

(g)

Corporate Identification. Within the past five years, the Seller has not done any business under, or been known by, any name other than its current names.

(h)

Intentionally Omitted.

(i)

Investments. The Seller has no subsidiaries and owns no stock or other equity interest in any other Person. The Seller is not a partner in any partnership or joint venture with any other Person.

(j)

Financial Information. The Seller has previously furnished to the Buyer audited balance sheets of the Seller as of December 31, 2003, December 31, 2004 and December 31, 2005, and audited income statements, statements of retained earnings and statements of cash flow of the Seller for the fiscal years ending on such dates (herein collectively referred to as the “Financial Statements”), and the unaudited balance sheet of the Seller as of June 30, 2006 and the unaudited income statement of the Seller for the period then ended on such date (the “Interim Statements”). The Financial Statements and the Interim Statements were prepared from the books and records of the Seller, which books and records accurately reflect in all material respects the accounts and transactions recorded therein. Except as set forth in Schedule 5(j) hereto, the Financial Statements were prepared in accordance with generally accepted accounting principles applied consistently throughout the periods covered and fairly present the financial condition and results of operations of the Seller as of the dates and for the periods indicated.

(k)

Undisclosed Liabilities. The Seller has no liabilities of a type required by generally accepted accounting principles to be reflected on a balance sheet (including the footnotes thereto), except (i) as reflected in the December 31, 2005 Financial Statements or the Interim Statements, (ii) as incurred in the Ordinary Course of Business since June 30, 2006 through the Closing Date, as set forth in Schedule 5(k).

(l)

Absence of Changes or Events. Since June 30, 2006, except as set forth in Schedule 5(l) hereto or as specifically permitted or contemplated by this Agreement:

(i)

there has not been any change in, and no event has occurred that could reasonably be expected to have a Material Adverse Effect on the Acquired Business or that adversely affects the Acquired Assets or Assumed Obligations in any material respect;

(ii)

there has not been any loss, damage or destruction to, or any interruption in the use of, any of the Acquired Assets or Assumed Obligations in any material respect;

(iii)

the Seller has not sold or otherwise transferred, or leased, or licensed, any material portion of the assets used in the Acquired Business to any other Person; except for non-exclusive, non-transferable licenses to software granted in the Ordinary Course of Business and except for sales of inventory in the Ordinary Course of Business;

(iv)

no material Contract related to, or necessary to the conduct of, the Acquired Business or Assumed Obligations has been amended or terminated;

(v)

the Seller has not caused any of the Acquired Assets or Assumed Obligations to become subject to any Encumbrances;

(vi)

except as contemplated by the Transaction Documents, the Seller has not entered into any transaction or taken any other action, in each case related to the Acquired Business outside the Ordinary Course of Business; and

(vii)

the Seller has not agreed (in writing or otherwise) to take any of the actions referred to in clauses “(i)” through “(vi)” above.

(m)

Litigation and Claims. There is no Proceeding pending or, to the Knowledge of the Seller, threatened against the Seller or any of its properties or rights, nor any judgment, order, injunction or decree before any court or other Governmental Body, that might result in any Material Adverse Effect on the Acquired Business, the Acquired Assets or the Assumed Obligations or which questions the validity of this Agreement or the transactions contemplated hereby, except as set forth in Schedule 5(m) hereto. There is no Order to which the Seller, or any of the Acquired Assets or Assumed Obligations, is subject; and none of the Affiliates of the Seller is subject to any Order that relates to the Acquired Business, Acquired Assets or Assumed Obligations.

(n)

Performance Of Services. There is no Proceeding pending or, to the Knowledge of the Seller, being threatened against the Seller relating to any services performed by the Seller in connection with the Acquired Business, and, to the Knowledge of the Seller, there is no reasonable basis for the assertion of any such claim, except as set forth on Schedule 5(n) hereto.

(o)

Intentionally Omitted.

(p)

Assets; Title and Related Matters.

(i)

None of the Acquired Assets is subject to any Encumbrances (including tax-related Encumbrances). At the Closing Date, the Seller will transfer to the Buyer good and marketable title to all Acquired Assets, free and clear of any Encumbrances.

(ii)

As of the Closing Date, no Affiliate of the Seller will own, control or have custody of any Acquired Asset.

(iii)

Except as contemplated by the Transaction Documents, neither the Seller nor any of its Affiliates has any agreement, absolute or contingent, written or oral, with any other Person to effect any Acquisition Transaction or to sell or otherwise transfer any of the Acquired Assets, except for non-exclusive, non-transferable licenses to software granted in the Ordinary Course of Business.

(q)

Contracts. Schedule 5(q) hereto lists all Contracts relating to the Acquired Business (collectively, “Acquired Business Contracts”) to which the Seller is a party or by which the Seller and the Acquired Assets are bound, other than any Acquired Business Contract (i) that was entered into by the Seller in the Ordinary Course of Business, and (ii) as to which the total payments due to or from the Seller over the term thereof (or upon early termination by the Seller) do not exceed $5,000. All forms of participation agreements the Seller has entered into with existing clients are attached here to as Exhibit D, and have been delivered to the Buyer for review prior to the date hereof. The Seller has delivered to the Buyer accurate and complete copies of all Acquired Business Contracts listed on Schedule 5(q) hereto in connection with Buyer’s diligence. With respect to each Acquired Business Contract listed on Schedule 5(q) hereto, except as indicated on such Schedule:

(i)

such Acquired Business Contract is valid and in full force and effect; the Seller is not in material default under such Acquired Business Contract and, to the knowledge of the Seller, no other party to such Acquired Business Contract is in material default thereunder, and there is no condition or basis known to the Seller for any claim of a material default by any party thereto or event which with notice, lapse of time or both would constitute a material default;

(ii)

no consent of any other Person is needed in order that such Acquired Business Contract continue in full force and effect following the consummation of the transactions contemplated by this Agreement;

(iii)

neither the execution and delivery of this Agreement nor the consummation of the transactions contemplated hereby will result in any breach or acceleration of, or constitute a default under, any such Acquired Business Contract; and

(iv)

no such Acquired Business Contract contains a covenant not to compete, an exclusivity provision in favor of any other party to the Seller’s Contract, or a change of control provision.

(r)

Intentionally Omitted.

(s)

Intentionally Omitted.

(t)

Borrowing and Lending. Except for loans from its parent corporation, the Seller has not, as either lender or borrower, entered into any Contract relating to lines of credit, loans or other extensions of credit or agreements therefor of any kind. A copy of each of such Contract has been furnished to the Buyer.

(u)

Intentionally Omitted.

(v)

Intentionally Omitted.

(w)

Compliance with Laws. The Seller is in full compliance with each Legal Requirement that is applicable to it or to the conduct of its business or the ownership or use of any of its assets, except to the extent any such noncompliance could not reasonably be expected to have a Material Adverse Effect on the Acquired Business. No event has occurred, and no condition or circumstance exists, that could (with or without notice or lapse of time) constitute or result directly or indirectly in a violation by the Seller of, or a failure on the part of the Seller to comply with, any Legal Requirement, except to the extent any such noncompliance could not reasonably be expected to have a Material Adverse Effect on the Acquired Business. The Seller has not received any written notice or other written communication, or any other written information, or to the Knowledge of the Seller, any oral notice, communication or other information, at any time, from any Governmental Body or any other Person regarding (i) any actual, alleged, possible or potential violation of, or failure to comply with, any Legal Requirement, or (ii) any actual, alleged, possible or potential obligation on the part of the Seller to undertake, or to bear all or any portion of the cost of, any cleanup or any remedial, corrective or response action of any nature. To the Knowledge of the Seller, no Governmental Body has proposed or is considering any Legal Requirement that, if adopted or otherwise put into effect, (i) may have a Material Adverse Effect on the Acquired Business, or (ii) may have the effect of preventing, delaying, making illegal or otherwise interfering with the consummation of the transactions contemplated by this Agreement.

(x)

Brokers. No broker, finder, agent or similar intermediary has acted for or on behalf of the Seller in connection with this Agreement or the transactions contemplated hereby, and no broker, finder, agent or similar intermediary is entitled to any broker’s, finder’s or similar fee or other commission in connection therewith based on any agreement, arrangement or understanding with the Seller or any action taken by the Seller.

(y)

Governmental Authority. Schedule 5(y) hereto identifies: each Governmental Authorization that is held by the Seller and is related to the conduct of the Acquired Business. The Seller has delivered to the Buyer accurate and complete copies of all of the Governmental Authorizations identified in Schedule 5(y), including all renewals thereof and all amendments thereto. Each Governmental Authorization identified or required to be identified in Schedule 5(y) hereto is valid and in full force and effect. The Seller is and has at all times been in full compliance with all of the terms and requirements of each Governmental Authorization identified or required to be identified in Schedule 5(y) hereto, except to the extent any such

noncompliance could not reasonably be expected to have a Material Adverse Effect on the Seller. To the Knowledge of the Seller, no event has occurred, and no condition or circumstance exists, that might (with or without notice or lapse of time) (A) constitute or result directly or indirectly in a violation of or a failure to comply with any term or requirement of any Governmental Authorization identified or required to be identified in Schedule 5(y) hereto, or (B) result directly or indirectly in the revocation, withdrawal, suspension, cancellation, termination or modification in any material respect of any Governmental Authorization identified or required to be identified in Schedule 5(y) hereto. The Seller has not received any written notice or other written communication (from any Governmental Body or any other Person regarding (A) any actual, alleged, possible or potential violation of or failure to comply with any term or requirement of any Governmental Authorization primarily related to the Acquired Business, or (B) any actual, proposed, possible or potential revocation, withdrawal, suspension, cancellation, termination or modification in any material respect of any Governmental Authorization primarily related to the Acquired Business. The Governmental Authorizations identified in Schedule 5(y) hereto constitute all of the Governmental Authorizations necessary (i) to enable the Seller to conduct the Acquired Business in the manner in which such business is currently being conducted, and (ii) to permit the Seller to own and use the assets related to the Acquired Business in the manner in which they are currently owned or used.

(z)

Affiliate Transactions. No Affiliate of the Seller: (a) has any direct or indirect interest of any nature in any of the Acquired Assets; (b) is competing with the Acquired Business; (c) has any claim or right against the Acquired Assets. To the Knowledge of the Seller, no event has occurred, and no condition or circumstance exists, that could (with or without notice or lapse of time) give rise to or serve as a basis for any claim or right in favor of any Affiliate of the Seller against the Acquired Assets.

(aa)

Inventory. Schedule 5(aa) hereto provides an accurate and complete breakdown of all Acquired Samples that are part of the Acquired Business as of the date of this Agreement.

(bb)

Sufficiency of Assets. The Acquired Assets constitute all the assets, properties, rights and goodwill necessary to carry on the Acquired Business as currently conducted by the Seller.

(cc)

Compliance. The Acquired Samples to be delivered to the Purchaser at Closing were processed and stored in compliance with all applicable government regulations at the time of collection.

(dd)

Bulk Transfer Laws. Seller has satisfied all obligations pursuant to any bulk transfer law or similar legal requirement in connection with any of the Transactions.

(ee)

Access to Information; Evaluation of Transaction. The Seller and its Representatives have had full and complete access to all records and information relating to the Buyer; have had the opportunity to ask all questions of and receive all answers from the Buyer and its officers and directors that the Seller and its Representatives have deemed necessary and

material for an evaluation of the merits and risks of its sale of the Acquired Assets; and have had an opportunity to obtain additional information to the extent deemed necessary or advisable by the Seller and its Representatives in order to verify the accuracy of the information obtained. The Seller has sufficient knowledge, experience and sophistication in financial and business matters, and is capable of evaluating the merits and risks of its sale of the Acquired Assets and of making an informed investment decision with respect thereto.

(ff)

Investment Representations; Restricted Securities.

(i)

Seller is acquiring the Common Stock for Seller’s own account for investment only, and not with a view towards its distribution. Seller represents that by reason of its, or of its management’s, business or financial experience, Seller has the capacity to protect its own interests in connection with the transactions contemplated in the Transaction Documents. Further, Seller is aware of no publication of any advertisement in connection with the transactions contemplated in the Transaction Documents. Seller represents that it is an accredited investor within the meaning of Regulation D under the Securities Act.

(ii)

Seller acknowledges and agrees that the shares of Common Stock issued as part of the Purchase Price are “restricted securities” as defined in Rule 144 promulgated under the Securities Act as in effect from time to time and must be held indefinitely unless they are subsequently registered under the Securities Act or an exemption from such registration is available, and will bear a legend to this effect. Seller has been advised or is aware of the provisions of Rule 144, which permits limited resale of shares purchased in a private placement subject to the satisfaction of certain conditions, including, among other things: the availability of certain current public information about the Buyer, the resale occurring following the required holding period under Rule 144 and the number of shares being sold during any three-month period not exceeding specified limitations.

DISCLAIMER OF OTHER REPRESENTATIONS AND WARRANTIES. EXCEPT AS EXPRESSLY SET FORTH IN THIS SECTION 5, THE SELLER MAKES NO REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, AT LAW OR IN EQUITY, IN RESPECT OF THE SELLER OR THE BUSINESS, INCLUDING, WITHOUT LIMITATION, WITH RESPECT TO MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE, AND ANY SUCH OTHER REPRESENTATIONS OR WARRANTIES ARE HEREBY EXPRESSLY DISCLAIMED.

REPRESENTATIONS AND WARRANTIES OF THE BUYER.

Buyer hereby represents and warrants to the Seller as follows:

(a)

Organization. The Buyer is a corporation duly organized, validly existing and in good standing under the laws of the State of Florida. The Buyer has all requisite corporate power and authority to own, operate and lease its properties and to carry on its business as now being conducted. The Buyer is duly qualified or licensed and in good standing to do business in each jurisdiction in which the property owned, leased or operated by it or the nature of the business

conducted by it makes such qualification necessary, except where the failure to be so qualified or licensed and in good standing, individually or in the aggregate, would not have a Material Adverse Effect on the Buyer.

(b)

Authority and Enforceability of Agreements. The Buyer has all requisite corporate power and authority to execute and deliver the Transaction Documents and to consummate the transactions contemplated thereby. The Transaction Documents have been duly authorized by all necessary corporate action of the Buyer. The Transaction Documents have been duly executed and delivered by the Buyer and constitute the valid and binding obligation of the Buyer enforceable against the Buyer in accordance with their terms, except as such enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or other similar laws, nor or hereinafter in effect, relating to creditors' rights generally and to general principles of equity.

(c)

Consents. Neither the execution and delivery of the Transaction Documents by the Buyer nor the consummation by the Buyer of the transactions contemplated thereby will require the Consent of any Governmental Body or other Person.

(d)

Capitalization. As of the date hereof the authorized capital stock of the Buyer consists of 300,000,000] shares of Common Stock and 5,000,000 shares of Preferred Stock, par value $0.0001 ("Preferred Stock") of which 40,510,000] shares of Common Stock and zero shares of Preferred Stock are issued and outstanding.. All of such outstanding shares have been validly issued and are fully paid and nonassessable. Except as disclosed in the SEC Documents (as defined in Section 6(g)), no shares of Common Stock are subject to preemptive rights or any other similar rights or any liens or encumbrances suffered or permitted by the Buyer. Except as disclosed in the SEC Documents, as of the date of this Agreement, (i) there are no outstanding options, warrants, scrip, rights to subscribe to, calls or commitments of any character whatsoever relating to, or securities or rights convertible into, any shares of capital stock of the Buyer or any of its subsidiaries, or contracts, commitments, understandings or arrangements by which the Buyer or any of its subsidiaries is or may become bound to issue additional shares of capital stock of the Buyer or any of its subsidiaries or options, warrants, scrip, rights to subscribe to, calls or commitments of any character whatsoever relating to, or securities or rights convertible into, any shares of capital stock of the Buyer or any of its subsidiaries, (ii) there are no outstanding debt securities, (iii) there are no agreements or arrangements under which the Buyer or any of its subsidiaries is obligated to register the sale of any of their securities under the Securities Act, except pursuant to the Registration Statement required by this Agreement, and to Cornell Capital Partners, L.P. and CORD, and (iv) there are no outstanding registration statements and there are no outstanding comment letters from the SEC or any other regulatory agency, other than with respect to Cornell Capital Partners, L.P. and CORD. There are no securities or instruments containing anti-dilution or similar provisions that will be triggered by the issuance of the Common Stock as described in this Agreement. The Buyer has furnished to the Buyer true and correct copies of the Buyer's Articles of Incorporation, as amended and as in effect on the date hereof (the "Articles of Incorporation"), and the Buyer's By-laws, as in effect on the date hereof (the "By-laws"), and the terms of all securities convertible into or exercisable

for Common Stock and the material rights of the holders thereof in respect thereto other than stock options issued to employees and consultants.

(e)

Issuance of Securities. The Common Stock is duly authorized and, upon issuance in accordance with the terms hereof, shall be duly issued, fully paid and nonassessable, is free from all taxes, liens and charges with respect to the issue thereof.

(f)

No Conflicts. The execution, delivery and performance of the Transaction Documents by the Buyer and the consummation by the Buyer of the transactions contemplated hereby will not (i) result in a violation of the Articles of Incorporation, any certificate of designations of any outstanding series of preferred stock of the Buyer or the By-laws or (ii) conflict with or constitute a default (or an event which with notice or lapse of time or both would become a default) under, or give to others any rights of termination, amendment, acceleration or cancellation of, any agreement, indenture or instrument to which the Buyer or any of its subsidiaries is a party, or result in a violation of any law, rule, regulation, order, judgment or decree (including federal and state securities laws and regulations and the rules and regulations of The National Association of Securities Dealers Inc.'s OTC Bulletin Board on which the Common Stock is quoted) applicable to the Buyer or any of its subsidiaries or by which any property or asset of the Buyer or any of its subsidiaries is bound or affected. Neither the Buyer nor its subsidiaries is in violation of any term of or in default under its Articles of Incorporation or By-laws or their organizational charter or by-laws, respectively, or any material contract, agreement, mortgage, indebtedness, indenture, instrument, judgment, decree or order or any statute, rule or regulation applicable to the Buyer or its subsidiaries. The business of the Buyer and its subsidiaries is not being conducted, and shall not be conducted in violation of any material law, ordinance, or regulation of any governmental entity. Except as specifically contemplated by this Agreement and as required under the Securities Act and any applicable state securities laws, the Buyer is not required to obtain any consent, authorization or order of, or make any filing or registration with, any court or governmental agency in order for it to execute, deliver or perform any of its obligations under or contemplated by this Agreement or the Registration Rights Agreement in accordance with the terms hereof or thereof. All consents, authorizations, orders, filings and registrations which the Buyer is required to obtain pursuant to the preceding sentence have been obtained or effected on or prior to the date hereof. The Buyer and its subsidiaries are unaware of any facts or circumstance, which might give rise to any of the foregoing.

(g)

SEC Documents: Financial Statements. Since January 1, 2003, the Buyer has filed all reports, schedules, forms, statements and other documents required to be filed by it with the SEC under the Securities Exchange Act of 1934, as amended (the "Exchange Act") (all of the foregoing filed prior to the date hereof or amended after the date hereof and all exhibits included therein and financial statements and schedules thereto and documents incorporated by reference therein, being hereinafter referred to as the "SEC Documents"). The Buyer has delivered to the Buyers or their representatives, or made available through the SEC's website at xxxx://xxx.xxx.xxx., true and complete copies of the SEC Documents. As of their respective dates, the financial statements of the Buyer disclosed in the SEC Documents (the "Financial

Statements") complied as to form in all material respects with applicable accounting requirements and the published rules and regulations of the SEC with respect thereto. Such financial statements have been prepared in accordance with generally accepted accounting principles, consistently applied, during the periods involved (except (i) as may be otherwise indicated in such Financial Statements or the notes thereto, or (ii) in the case of unaudited interim statements, to the extent they may exclude footnotes or may be condensed or summary statements) and, fairly present in all material respects the financial position of the Buyer as of the dates thereof and the results of its operations and cash flows for the periods then ended (subject, in the case of unaudited statements, to normal year-end audit adjustments). No other information provided by or on behalf of the Buyer to the Buyer which is not included in the SEC Documents, including, without limitation, information referred to in this Agreement, contains any untrue statement of a material fact or omits to state any material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading.

(h)

10(b)-5. The SEC Documents do not include any untrue statements of material fact, nor do they omit to state any material fact required to be stated therein necessary to make the statements made, in light of the circumstances under which they were made, not misleading.

(i)

Absence of Litigation. There is no action, suit, proceeding, inquiry or investigation before or by any court, public board, government agency, self-regulatory organization or body pending against or affecting the Buyer, the Common Stock or any of the Buyer's subsidiaries, wherein an unfavorable decision, ruling or finding would (i) have a material adverse effect on the transactions contemplated hereby (ii) adversely affect the validity or enforceability of, or the authority or ability of the Buyer to perform its obligations under, this Agreement or any of the documents contemplated herein, or (iii) have a material adverse effect on the business, operations, properties, financial condition or results of operations of the Buyer and its subsidiaries taken as a whole.

(j)

No General Solicitation. Neither the Buyer, nor any of its affiliates, nor any person acting on its or their behalf, has engaged in any form of general solicitation or general advertising (within the meaning of Regulation D under the Securities Act) in connection with the offer or sale of the Common Stock.

(k)

No Integrated Offering. Neither the Buyer, nor any of its affiliates, nor any person acting on its or their behalf has, directly or indirectly, made any offers or sales of any security or solicited any offers to buy any security, under circumstances that would require registration of the Common Stock under the Securities Act or cause this offering of the Common Stock to be integrated with prior offerings by the Buyer for purposes of the Securities Act.

(l)

Employee Relations. Neither the Buyer nor any of its subsidiaries is involved in any labor dispute nor, to the knowledge of the Buyer or any of its subsidiaries, is any such dispute threatened. None of the Buyer's or its subsidiaries' employees is a member of a union and the Buyer and its subsidiaries believe that their relations with their employees are good.

(m)

Intellectual Property Rights. The Buyer and its subsidiaries own or possess adequate rights or licenses to use all trademarks, trade names, service marks, service xxxx registrations, service names, patents, patent rights, copyrights, inventions, licenses, approvals, governmental authorizations, trade secrets and rights necessary to conduct their respective businesses as now conducted. The Buyer and its subsidiaries do not have any knowledge of any infringement by the Buyer or its subsidiaries of trademark, trade name rights, patents, patent rights, copyrights, inventions, licenses, service names, service marks, service xxxx registrations, trade secret or other similar rights of others, and, to the knowledge of the Buyer there is no claim, action or proceeding being made or brought against, or to the Buyer's knowledge, being threatened against, the Buyer or its subsidiaries regarding trademark, trade name, patents, patent rights, invention, copyright, license, service names, service marks, service xxxx registrations, trade secret or other infringement; and the Buyer and its subsidiaries are unaware of any facts or circumstances which might give rise to any of the foregoing.

(n)

Environmental Laws. The Buyer and its subsidiaries are (i) in compliance with any and all applicable foreign, federal, state and local laws and regulations relating to the protection of human health and safety, the environment or hazardous or toxic substances or wastes, pollutants or contaminants ("Environmental Laws"), (ii) have received all permits, licenses or other approvals required of them under applicable Environmental Laws to conduct their respective businesses and (iii) are in compliance with all terms and conditions of any such permit, license or approval.

(o)

Title. Any real property and facilities held under lease by the Buyer and its subsidiaries are held by them under valid, subsisting and enforceable leases with such exceptions as are not material and do not interfere with the use made and proposed to be made of such property and buildings by the Buyer and its subsidiaries.

(p)

Insurance. The Buyer and each of its subsidiaries are insured by insurers of recognized financial responsibility against such losses and risks and in such amounts as management of the Buyer believes to be prudent and customary in the businesses in which the Buyer and its subsidiaries are engaged. Neither the Buyer nor any such subsidiary has been refused any insurance coverage sought or applied for and neither the Buyer nor any such subsidiary has any reason to believe that it will not be able to renew its existing insurance coverage as and when such coverage expires or to obtain similar coverage from similar insurers as may be necessary to continue its business at a cost that would not materially and adversely affect the condition, financial or otherwise, or the earnings, business or operations of the Buyer and its subsidiaries, taken as a whole.

(q)

Regulatory Permits. The Buyer and its subsidiaries possess all material certificates, authorizations and permits issued by the appropriate federal, state or foreign regulatory authorities necessary to conduct their respective businesses, and neither the Buyer nor any such subsidiary has received any notice of proceedings relating to the revocation or modification of any such certificate, authorization or permit.

(r)

Internal Accounting Controls. The Buyer and each of its subsidiaries maintain a system of internal accounting controls sufficient to provide reasonable assurance that (i) transactions are executed in accordance with management's general or specific authorizations, (ii) transactions are recorded as necessary to permit preparation of financial statements in conformity with generally accepted accounting principles and to maintain asset accountability, and (iii) the recorded amounts for assets is compared with the existing assets at reasonable intervals and appropriate action is taken with respect to any differences.

(s)

No Material Adverse Breaches, etc. Neither the Buyer nor any of its subsidiaries is subject to any charter, corporate or other legal restriction, or any judgment, decree, order, rule or regulation which in the judgment of the Buyer's officers has or is expected in the future to have a material adverse effect on the business, properties, operations, financial condition, results of operations or prospects of the Buyer or its subsidiaries. Neither the Buyer nor any of its subsidiaries is in breach of any contract or agreement which breach, in the judgment of the Buyer's officers, has or is expected to have a material adverse effect on the business, properties, operations, financial condition, results of operations or prospects of the Buyer or its subsidiaries.

(t)

Tax Status. The Buyer and each of its subsidiaries has made and filed all federal and state income and all other tax returns, reports and declarations required by any jurisdiction to which it is subject and (unless and only to the extent that the Buyer and each of its subsidiaries has set aside on its books provisions reasonably adequate for the payment of all unpaid and unreported taxes) has paid all taxes and other governmental assessments and charges that are material in amount, shown or determined to be due on such returns, reports and declarations, except those being contested in good faith and has set aside on its books provision reasonably adequate for the payment of all taxes for periods subsequent to the periods to which such returns, reports or declarations apply. There are no unpaid taxes in any material amount claimed to be due by the taxing authority of any jurisdiction, and the officers of the Buyer know of no basis for any such claim.

(u)

Certain Transactions. Except for arm's length transactions pursuant to which the Buyer makes payments in the ordinary course of business upon terms no less favorable than the Buyer could obtain from third parties and other than the grant of stock options disclosed in the SEC Documents, none of the officers, directors, or employees of the Buyer is presently a party to any transaction with the Buyer (other than for services as employees, officers and directors), including any contract, agreement or other arrangement providing for the furnishing of services to or by, providing for rental of real or personal property to or from, or otherwise requiring payments to or from any officer, director or such employee or, to the knowledge of the Buyer, any corporation, partnership, trust or other entity in which any officer, director, or any such employee has a substantial interest or is an officer, director, trustee or partner.

(v)

Brokers. No broker, finder, agent or similar intermediary has acted for or on behalf of the Buyer in connection with this Agreement or the transactions contemplated hereby, and no broker, finder, agent or similar intermediary is entitled to any broker’s, finder’s or similar

fee or other commission in connection therewith based on any agreement, arrangement or understanding with the Buyer or any action taken by the Buyer.

(w)

Access to Information; Evaluation of Transaction. The Buyer and its Representatives have had full and complete access to all records and information relating to the Seller and the Acquired Business; have had the opportunity to ask all questions of and receive all answers from the Seller and its officers and directors concerning the Seller and the Acquired Business that the Buyer and its Representatives have deemed necessary and material for an evaluation of the merits and risks of its purchase of the Acquired Assets; and have had an opportunity to obtain additional information to the extent deemed necessary or advisable by the Buyer and its Representatives in order to verify the accuracy of the information obtained. The Buyer has sufficient knowledge, experience and sophistication in financial and business matters, and is capable of evaluating the merits and risks of its purchase of the Acquired Assets and of making an informed investment decision with respect thereto.

DISCLAIMER OF OTHER REPRESENTATIONS AND WARRANTIES. EXCEPT AS EXPRESSLY SET FORTH IN THIS SECTION 6, THE BUYER MAKES NO REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, AT LAW OR IN EQUITY, IN RESPECT OF THE BUYER OR ITS BUSINESS AND ANY SUCH OTHER REPRESENTATIONS OR WARRANTIES ARE HEREBY EXPRESSLY DISCLAIMED.

PRE-CLOSING COVENANTS OF THE SELLER.

(a)

Access and Investigation. During the Pre-Closing Period: (a) the Seller will provide the Buyer with access, during normal business hours and upon reasonable advance notice, and in a manner so as not to interfere with its normal business operations, to all premises, properties, personnel, books, records, tax returns, work papers and other documents and information relating to the Seller and the Acquired Business; and (b) the Seller will provide the Buyer with such copies of such books, records, tax returns, work papers and other documents and information relating to the Seller and the Acquired Business as the Buyer may reasonably request. All documents and information obtained pursuant to this Section 7(a) shall be treated by the Buyer as confidential information that is subject to the terms of the Confidentiality Agreement dated as of [__________], 2006 (the “Confidentiality Agreement”) between the Seller and the Buyer.

(b)

Operation of Business. During the Pre-Closing Period, the Seller will carry on the Acquired Business in the ordinary course of business consistent with the manner in which the Acquired Business has previously been conducted, pay its debts and Taxes when due and pay and perform its other obligations when due, and, to the extent consistent with the Acquired Business, use commercially reasonable best efforts consistent with past practice and policies to preserve intact the present business of the Seller, preserve its relationships with customers, suppliers, licensors, licensees, and others having business dealings with the Seller. Without limiting the generality of the foregoing, during the Pre-Closing Period, except as otherwise approved in writing by the Buyer:

(i)

the Seller conducts its operations exclusively in the Ordinary Course of Business and in substantially the same manner as such operations have been conducted prior to the date of this Agreement;

(ii)

the Seller will not incur or assume any material liability outside the Ordinary Course of Business; and

(iii)

the Seller will not enter into any transaction or take any other action of the type referred to in Section 5(l) hereof.

(c)

Efforts to Close. The Seller will use commercially reasonable best efforts to take all action and to do all things necessary, proper, or advisable in order to fulfill and perform its obligations under this Agreement and to consummate and make effective the transactions contemplated by this Agreement (including the satisfaction, but not the waiver, of the closing conditions set forth in Section 11 hereof).

(d)

Filings and Consents. During the Pre-Closing Period, the Seller will cooperate with the Buyer and prepare and make available such documents and take such other actions as the Buyer may reasonably request in connection with obtaining any Consent that the Buyer is required or elects to make, give or obtain.

(e)

Notification. During the Pre-Closing Period, the Seller shall promptly notify the Buyer in writing of, and shall subsequently keep such other party updated on a current basis regarding: (a) the discovery of any event, condition, fact or circumstance that occurred or existed on or prior to the date of this Agreement and that caused or constitutes a Breach of any representation or warranty made in this Agreement; (b) any event, condition, fact or circumstance that occurs, arises or exists after the date of this Agreement and that would cause or constitute a Breach of any representation or warranty made in this Agreement if (i) such representation or warranty had been made as of the time of the occurrence, existence or discovery of such event, condition, fact or circumstance, or (ii) such event, condition, fact or circumstance had occurred, arisen or existed on or prior to the date of this Agreement; (c) any Breach of any covenant or obligation; and (d) any event, condition, fact or circumstance that could reasonably be expected to make the timely satisfaction of any of the conditions to close set forth in this Agreement impossible or unlikely.

(f)

No Solicitation. During the Pre-Closing Period, the Seller will not, directly or indirectly: (i) solicit or encourage the initiation of any inquiry or offer, or submission of a proposal from any Person (other than the Buyer) relating to a possible Acquisition Transaction; (ii) consider, engage or participate in any discussions or negotiations or enter into any agreement, understanding or arrangement with, or provide any non public information to, any Person (other than the Buyer) relating to or in connection with a possible Acquisition Transaction; or (iii) consider, entertain or accept any proposal or offer from any Person (other than the Buyer) relating to a possible Acquisition Transaction.

PRE-CLOSING COVENANTS OF THE BUYER.

(a)

Efforts to Close. The Buyer will use commercially reasonable best efforts to take all actions and to do all things necessary, proper, or advisable in order to fulfill and perform the Buyer’s obligations under this Agreement and to consummate and make effective the transactions contemplated by this Agreement (including the satisfaction, but not the waiver, of the closing conditions set forth in Section 10 hereof).

(b)

Filings and Consents. During the Pre-Closing Period, the Buyer will cooperate with the Seller and prepare and make available such documents and take such other actions as the Seller may reasonably request in connection with any Consent that the Seller is required or elects to make, give or obtain.

(c)

Notice of Breach. During the Pre-Closing Period, the Buyer shall promptly notify the Seller in writing of, and shall subsequently keep such other party updated on a current basis regarding: (a) the discovery of any event, condition, fact or circumstance that occurred or existed on or prior to the date of this Agreement and that caused or constitutes a Breach of any representation or warranty made in this Agreement; (b) any event, condition, fact or circumstance that occurs, arises or exists after the date of this Agreement and that would cause or constitute a Breach of any representation or warranty made in this Agreement if (i) such representation or warranty had been made as of the time of the occurrence, existence or discovery of such event, condition, fact or circumstance, or (ii) such event, condition, fact or circumstance had occurred, arisen or existed on or prior to the date of this Agreement; (c) any Breach of any covenant or obligation; and (d) any event, condition, fact or circumstance that could reasonably be expected to make the timely satisfaction of any of the conditions to close set forth in this Agreement impossible or unlikely.

(d)

Financing. Buyer shall use its commercially reasonable best efforts to obtain the Financing in order to Close, and keep Seller informed of Buyer’s progress on a weekly basis.

OTHER AGREEMENTS; FURTHER ACTIONS

(a)

The Seller shall, and shall cause its Affiliates to, reasonably cooperate with the Buyer in its efforts to continue and maintain for the benefit of the Purchaser those business relationships of Seller existing prior to the Closing Date and part of the Acquired Business, including relationships with lessors, licensors, customers, suppliers, providers, payers, vendors and others. Neither the Seller nor any of its Affiliates or its or their officers, employees or Representatives shall take any action after the Closing Date which could reasonably be expected to diminish the value of the Acquired Assets or interfere with the customers or operations of the Acquired Business, and (ii) neither the Seller nor any of its Affiliates will satisfy any of the Excluded Liabilities in a manner reasonably likely to be detrimental to such relationships, individually or as a whole.

(b)

The Seller and the Buyer will cooperate in good faith in connection with the filing of Tax Returns, any audit or Proceeding with respect to Taxes and in connection with any other Proceeding in each case relating to the Acquired Assets or the Acquired Business, as and to the extent reasonably requested by the Buyer or the Seller. Such cooperation shall include (1) the

retention and (upon a party’s request) the provision of records and information which are reasonably relevant to the preparation of Tax Returns or to any such Proceeding and (2) making relevant employees available on a mutually convenient basis to provide additional information and explanation of any material provided hereunder. The Seller and the Buyer shall (1) retain all Records with respect to Tax matters pertinent to the Acquired Assets relating to any period beginning before the Closing Date until the expiration of all relevant statues of limitations (and, to the extent notified by the Seller or the Buyer, any extensions thereof), and abide by all record retention agreements entered into with any Governmental Authority with respect to Taxes (with respect to agreements of another party, to the extent notified thereof) and (2) give the other parties to this Agreement reasonable written notice prior to transferring, destroying or discarding any such Records.

(c)

During the Pre-Closing Period, the Seller will exercise its commercially reasonable efforts to transfer to the Purchaser all customer relationships primarily related to the Acquired Business.

(d)

Confidentiality. Each party and their respective Representatives will hold, and will cause its consultants and advisers to hold, in confidence all Confidential Information furnished to it by or on behalf of the other party in connection with the transactions contemplated by this Agreement as follows:

(i)

Except as permitted by subparagraph (ii) below, each party agrees that it will not, without prior written consent of the other party, disclose or use for its own benefit any Confidential Information of the other party.

(ii)

Notwithstanding the provisions of subsection (i) above, each of the parties shall be permitted to:

(A)

Disclose Confidential Information of the other party to its officers, directors, employees, lenders, counsel, accountants and other agents, but only to the extent reasonably necessary in order for such party to perform its obligations and exercise its rights and remedies under the Transaction Documents, and such party shall take all such action as shall be necessary or desirable in order to ensure that each of such persons maintains the confidentiality of any Confidential Information that is so disclosed; and

(B)

Disclose Confidential Information of the other party to the extent, but only to the extent, required by law; provided that prior to making any disclosure pursuant to this section, the party required to make such disclosure (the “Disclosing Party”) shall notify the other party (the “Affected Party”) of the same, and the Affected Party shall have the right to participate with the Disclosing Party in determining the amount and type of Confidential Information of the Affected Party, if any, which must be disclosed in order to comply with applicable laws.

(iii)

The Buyer and the Seller acknowledge and agree that each party would be irreparably damaged in the event that any of the provisions of this section are not performed by

the other in accordance with their specific terms or are otherwise breached. Accordingly, it is agreed that each party shall be entitled to an injunction or injunctions to prevent a Breach of this section by the other and shall have the right to specifically enforce this section and the terms and provisions hereof against the other, in addition to any other remedy to which such party may be entitled at law or in equity.

(e)

Access to Records After the Closing. Except as may be reasonably appropriate to ensure compliance with respect to any applicable Legal Requirements (including, without limitation, any applicable antitrust regulations), and subject to any confidentiality obligations or applicable privileges (including, without limitation, the attorney-client privilege), for a period of three years after the Closing Date, the Seller and its Representatives, on the one hand, and the Buyer and its Representatives, on the other hand, shall have reasonable access, during normal business hours and at the expense of the party seeking access, to any reasonably available business records to the extent that such access may be reasonably required, in the case of the Seller in connection with matters relating to the operation of the Acquired Business prior to the Closing Date, and, in the case of the Buyer, in connection with the Acquired Assets and Assumed Obligations subsequent to the Closing Date; provided, however, that the requesting party shall only be entitled to such Records upon the execution of a customary confidentiality agreement.

(f)

Public Announcements. The Buyer and the Seller will consult with each other as to the form, substance and timing of the initial press release or other initial public statement relating to this Agreement, or any of the Transactions, and no such initial statement will be made by one without the written consent of the other, which consent will not be unreasonably withheld or delayed; provided that each may make such disclosures as are necessary to comply with any Legal Requirement or the request of any Governmental Body after making good faith efforts under the circumstances to consult in advance with the other. Notwithstanding the foregoing, the parties shall agree to a joint press release upon the execution of this Agreement.

(g)

Registration Rights. As soon as reasonably practicable following the Closing Date, the Buyer shall file a registration statement on Form SB-2 (the “Registration Statement”) with the Securities and Exchange Commission (the “SEC”) to register the re-sale of (i) the shares of Stock Consideration delivered to the Seller as part of the Purchase Price (the “Registered Shares”) and (ii) the shares of Common Stock issued to the financer for this Agreement. The Buyer will use its commercially reasonable efforts to cause the Registration Statement to be declared effective by the SEC and will otherwise effect all such registrations, obtain all such qualifications and comply with all such laws, rules and regulations as may be necessary in order to permit the re-sale, transfer and other disposition of the Registered Shares by Seller (including, without limitation, the execution of any required undertaking to file post-effective amendments, appropriate qualifications or exemptions under applicable blue sky or other state securities laws and appropriate compliance with applicable securities laws, requirements or regulations). All expenses incurred in connection with any registration, qualification, exemption or compliance pursuant to the Section 9(g) shall be borne by the Buyer. The Buyer will use all commercially reasonable efforts to keep the Registration Statement

effective until the earlier of the following: (i) the second anniversary of the Closing Date or (ii) the date all Registered Shares held by the Seller may be sold under Rule 144 during any 90 day period.

(h)

Board Seat.

Buyer agrees to permit Seller to select one candidate for the Board of Directors of Buyer (the “Board”) to consider for nomination to the Board.

10.

CONDITIONS TO OBLIGATION OF THE BUYER TO CLOSE.

The obligation of the Buyer to consummate the transactions to be performed by it in connection with the Closing is subject to satisfaction, or the written waiver thereof by the Buyer, of the following conditions:

(a)

Representations and Warranties. The representations and warranties of the Seller set forth in Section 5 hereof shall be true and correct (determined without regard to any Material Adverse Effect or other materiality qualifier therein) as of the date of this Agreement and as of the Closing Date as though made on and as of the Closing Date (unless such representations and warranties expressly relate to an earlier date, in which case they shall be true and correct as of such earlier date), except to the extent that the failure of such representations and warranties to be true and correct would not have, individually or in the aggregate, a Material Adverse Effect on the Seller or the Acquired Business or Acquired Assets, or a Material Adverse Effect on the ability of the Seller to consummate the transactions contemplated hereby.

(b)

Performance of Obligations. The Seller shall have performed and complied with in all material respects all of its agreements and covenants under this Agreement through the Closing.

(c)

Legal Proceedings. No Proceeding shall be pending wherein an unfavorable injunction, judgment, order, decree, ruling, or charge would (A) prohibit consummation of any of the transactions contemplated by this Agreement, (B) cause any of the transactions contemplated by this Agreement to be rescinded following consummation, or (C) affect adversely and materially the right of the Buyer to own the Acquired Assets; and no such injunction, judgment, order, decree, ruling or charge shall be in effect.

(d)

Certificate of the Seller. The Buyer shall have received a certificate, executed by the Chief Executive Officer of the Seller and dated as of the Closing Date, to the effect that the conditions specified above in Sections 10(a), 10(b) and 10(c) are satisfied in all respects.

(e)

Governmental and Regulatory Approvals. All Consents from the Governmental Bodies and other Persons set forth on Schedule 10(e) hereto shall have been obtained, at Seller’s expense.

(f)

No Material Adverse Effect. There shall not have occurred a Material Adverse Effect on the Seller since the date of this Agreement.

(g)

Opinion of Counsel to the Seller. The Buyer shall have received from counsel to the Seller an opinion in form and substance reasonably satisfactory to the Buyer, addressed to the Buyer and dated as of the Closing Date.

(h)

Buyer Financing. The Buyer shall have obtained financing to complete the acquisition of the Acquired Assets on terms and conditions satisfactory to the Buyer (the “Financing”).

(i)

Transfer and Sales Taxes. The Seller shall have paid, or made arrangements to pay, all sales taxes, use taxes, filing fees and similar taxes, fees, charges and expenses required to be paid as a result of the transfer of the Acquired Assets to the Buyer.

(j)

Xxxx of Sale. The Seller shall have executed and delivered to the Buyer the Xxxx of Sale.

(k)

Assignment and Assumption Agreement. The Seller shall have executed and delivered to the Buyer the Assignment and Assumption Agreement.

(l)

Acquired Sample Transfer.

The Seller shall have moved their 11 MVE Cryo-preservation tanks (and the Acquired Samples contained therein) (and purchased any such tanks not owned by Seller), from Xxxxxxx Institute for Medical Research to Xxxxxx BioServices, Inc., at Seller’s own expense, subject to reimbursement by Buyer at Closing in the amount of the total cost of such purchase and move, estimated to be approximately $121,651, (the “Acquired Sample Transfer”).

(m)

Contribution Agreement. Vita 34 International AG, a German corporation, shall have executed and delivered to Buyer a Contribution Agreement in the form of Exhibit E attached hereto.

11.

CONDITIONS TO OBLIGATION OF THE SELLER TO CLOSE.

The obligation of the Seller to consummate the transactions to be performed by it in connection with the Closing is subject to satisfaction, or the written waiver thereof by the Seller, of the following conditions:

(a)

Representations and Warranties. The representations and warranties of the Buyer set forth in Section 6 hereof shall be true and correct (determined without regard to any Material Adverse Effect or other materiality qualifier therein) as of the date of this Agreement and at and as of the Closing Date as though made on and as of the Closing Date (unless such representations and warranties expressly relate to an earlier date, in which case they shall be true and correct as of such earlier date), except to the extent that the failure of such representations and warranties to be true and correct would not have, individually or in the aggregate, a Material Adverse Effect on the ability of the Buyer to consummate the transactions contemplated by this Agreement.

(b)

Performance of Obligations. The Buyer shall have performed and complied with in all material respects all of its agreements and covenants under this Agreement through the Closing.

(c)

Legal Proceedings. No Proceeding shall be pending wherein an unfavorable injunction, judgment, order, decree, ruling, or charge would (A) prohibit consummation of any of the transactions contemplated by this Agreement, or (B) cause any of the transactions contemplated by this Agreement to be rescinded following consummation; and no such injunction, judgment, order, decree, ruling or charge shall be in effect.

(d)

Certificate of the Buyer. The Buyer shall have delivered to the Seller a certificate, executed by the Chief Executive Officer of the Buyer and dated as of the Closing Date, to the effect that the conditions specified above in Sections 11(a), 11(b) and 11(c) are satisfied in all respects.

(e)

Governmental and Regulatory Approvals. All Consents from the Governmental Bodies and other Persons set forth on Schedule 11(e) hereto shall have been obtained, at Seller’s expense.

(f)

Opinion of Counsel to the Buyer. The Seller shall have received from counsel to the Buyer an opinion in form and substance reasonably satisfactory to the Seller, addressed to the Seller and dated as of the Closing Date.

(g)

Assignment and Assumption Agreement. The Buyer shall have executed and delivered to the Seller the Assignment and Assumption Agreement.

(h)

Reimbursement for Acquired Sample Transfer. The Seller shall have received a payment from Buyer equal to the cost of the Acquired Sample Transfer, in cash at Closing.

12.

INDEMNIFICATION.

(a)

Indemnification by the Seller. Subject to the limitations set forth in this Section 11, the Seller shall indemnify and hold harmless the Buyer and its successors and assigns, and their respective directors, officers, employees, agents and representatives (collectively, the “Buyer Indemnitees”), from and against any and all actions, suits, claims, demands, debts, liabilities, obligations, losses, damages, costs and expenses, including reasonable attorney’s fees and court costs (the “Losses”), arising out of or caused by, any of all of the following:

(i)

Any Breach of any representation, warranty or covenant made by the Seller in Section 5 of this Agreement or in any Transaction Document, which representation, warranty and covenant shall survive for a period of three (3) years following the Closing Date;

(ii)

All Excluded Liabilities, including the Real Property Lease; and

(iii)

Any failure of Seller to observe or perform any covenant or obligation required to be observed or performed by it under this Agreement or any other Transaction Document.

(b)

Indemnification by the Buyer. The Buyer shall indemnify and hold harmless the Seller, and its directors, officers, employees, agents and representatives (collectively, the “Seller Indemnitees”), from and against any and all Losses, directly arising out of or directly caused by any failure of the Buyer to observe or perform any covenant or obligation required to be observed or performed by it pursuant to the Assumed Obligations.

(c)

Indemnification Procedures. With respect to each event, occurrence, claim or matter (“Indemnification Matter”) as to which any Buyer Indemnitee or any Seller Indemnitee, as the case may be (in either case, referred to collectively as the “Indemnitee”) is entitled to indemnification from the Seller Indemnitors or the Buyer Indemnitors, as the case may be (in either case referred to collectively as the “Indemnitor”), under this Section 12:

(i)

The Indemnitee shall give the Indemnitor written notice (the “Indemnification Notice”) of the assertion or commencement of any claim, demand, action or other proceeding against the Indemnitee promptly after the Indemnitee obtains knowledge thereof; provided, however, that any failure on the part of the Indemnitee to so notify the Indemnitor shall not limit any of the obligations of the Indemnitor under this Section 12, except to the extent such failure materially prejudices the defense of such claim, demand, action or other proceeding. The Indemnification Notice shall set forth the nature of the Indemnification Matter and the amount demanded or claimed in connection therewith, to the extent such information is known to the Indemnitee, together with copies of any written documents regarding the Indemnification Matter.

(ii)

If a third party claim, demand, action or other proceeding is involved, then, upon receipt of the Indemnification Notice, the Indemnitor shall, at its expense and through counsel of its choice, assume and have sole control over the litigation, defense or settlement (the “Defense”) of the Indemnification Matter; provided, however, that (a) the Indemnitee may, at its option and expense and through counsel of its choice, participate in (but not control) the Defense; (b) the Indemnitor shall not consent to any judgment, or agree to any settlement (without the Indemnitee’s prior written consent, which consent may not be unreasonably withheld) that would result in the imposition of a consent order, injunction or decree which would restrict the future activity or conduct of the Indemnitee or Affiliate thereof or if such judgment or settlement would not include an unconditional release of the other party for any liability arising out of such claim, demand, action or other proceeding. In any event, the Indemnitor and the Indemnitee shall fully cooperate with each other in connection with the Defense, including without limitation by furnishing all available documentary or other evidence as is reasonably requested by the other.

(iii)

Subject to Section 12(e) and 12(f) hereof, all amounts owed by the Indemnitor to the Indemnitee, if any, shall be paid in full within thirty (30) days after the date of a final non-appealable judgment determining the amount owed or after the execution and delivery of a final settlement agreement specifying the amount owed.

(d)

Limits on Indemnification. The liability of the Seller for indemnification under this Section 12 shall be limited as follows:

(i)

No amount shall be payable by the Seller for indemnification under this Section 12 unless and until the aggregate amount otherwise payable by the Seller under this Section 12 exceeds $10,000 (the “Basket”), in which event the Seller shall pay all amounts payable by it under this Section 12 from and above the amount of such Basket.

(ii)

The Seller shall have no liability under this Section 12 with respect to any Indemnification Matter unless the Indemnitee gives an Indemnification Notice with respect thereto within three (3) years after the Closing Date.

(e)

Liability of the Seller Limited. Notwithstanding anything to the contrary contained in this Agreement, any other Transaction Document or any other document, any claim against the Seller for indemnification under this Section 12 shall be limited to $3,770,000; provided, however, that the Sellers’ liability shall not be limited to $3,770,000 in respect of any claims with respect to any and all Losses arising out of or relating to fraud, intentional misrepresentation or the Excluded Liabilities, including, but not limited to the PharmaStem Litigation, the Acquired Sample Transfer and the Real Property Lease.

(f)

Calculation of Losses. The amount of the Losses relating to an Indemnification Matter shall not include any punitive or special damages (except to the extent that a third party seeks punitive or special damages against an Indemnitee).

(g)

Non-Exclusive Remedy. The parties acknowledge and agree that the indemnification provisions in this Section 12 shall not be the exclusive remedy of the parties in respect of any claims (including without limitation claims for any Breach of any representations, warranties, covenants or other obligations) with respect to any and all Losses arising out of or relating to this Agreement and the other Transaction Documents and the transactions contemplated hereby and thereby; provided, however, that monetary damages shall be limited to $3,770,000; provided, further, that the monetary damages shall not be limited to $3,770,000 in respect of any claims with respect to any and all Losses arising out of or relating to fraud, intentional misrepresentation or the Excluded Liabilities, including, but not limited to the PharmaStem Litigation, the Acquired Sample Transfer and the Real Property Lease.

(h)

Character of Indemnity Payments. The parties agree to treat any indemnity payments made under this Section 12 as adjustments to the Purchase Price.

(i)

Survival. The provisions of this Section 12 shall survive for a period of three (3) years following the Closing Date.

13.

TERMINATION.

(a)

Termination of Agreement. This Agreement may be terminated as provided below:

(i)

The Buyer and the Seller may terminate this Agreement by mutual written consent at any time prior to the Closing;

(ii)

The Buyer may terminate this Agreement by giving written notice to the Seller at any time prior to the Closing if (A) the representations and warranties of the Seller are not true and correct in all respects (determined without regard to any materiality or material adverse effect qualifier therein) at and as of the date hereof or as of a subsequent date as if made on a subsequent date (unless such representations and warranties expressly relate to an earlier date, in which case they are not true and correct as of such earlier date), (B) the Buyer has given written notice to the Seller of such Breach, and (C) such Breach has continued without cure for a period of thirty (30) days thereafter, in which case the date in Section 13(a)(v) below shall be extended by such 30 days;

(iii)

The Seller may terminate this Agreement by giving written notice to the Buyer at any time prior to the Closing if (A) the representations and warranties of the Buyer are not true and correct in all respects (determined without regard to any materiality qualifier therein) at and as of the date hereof or as of a subsequent date as if made on a subsequent date (unless such representations and warranties expressly relate to an earlier date, in which case they are not true and correct as of such earlier date), (B) the Seller has given written notice to the Buyer of such Breach, and (C) such Breach has continued without cure for a period of thirty (30) days thereafter, in which case the date in Section 13(a)(v) below shall be extended by such 30 days;

(iv)

Either the Buyer or the Seller may terminate this Agreement at any time prior to the Closing if a court of competent jurisdiction or other Governmental Body shall have issued a final and nonappealable order, decree or ruling, or shall have taken any other action, where the result would have the effect of (A) permanently restraining, enjoining or otherwise prohibiting the acquisition of the Assets or making the consummation of the transactions contemplated by this Agreement illegal; provided, however, that a party shall not be permitted to terminate this Agreement pursuant to this Section 13(a)(iv) if the issuance of such order, decree or ruling or the taking of such action is attributable to the failure of such party to perform in any material respect any covenant or obligation required to be performed by such party under this Agreement at or prior to the Closing;

(v)

Either the Buyer or the Seller may terminate this Agreement at any time prior to the Closing if the Closing shall not have occurred on or prior to March 31, 2007 (other than as a result of any failure on the part of the terminating party to comply with or perform its covenants and obligations under this Agreement in all material respects).

(b)

Termination Procedures. If either party wishes to terminate this Agreement pursuant to this Section 13, then Buyer or Seller, as the case may be, shall deliver to the other party a written notice stating that it is terminating this Agreement and setting forth a brief description of the basis on which they are terminating this Agreement.

(c)

Effect of Termination; Termination Fee. If any party terminates this Agreement pursuant to Section 13 above, all rights and obligations of the parties hereunder shall terminate without any liability of any party to any other party; provided, however, that if this Agreement is terminated pursuant to Section 13(a)(ii) or 13(a)(iii) by (i) the Buyer, then the Seller shall immediately pay to the Buyer a termination fee in the amount of One Hundred Thousand Dollars ($100,000) or (ii) the Seller, then at the Seller’s sole option, the Seller shall either be assigned in full the Pledged Shares or the Buyer shall immediately pay to the Seller a termination fee in the amount of One Hundred Thousand Dollars ($100,000), each of subparagraphs (i) and (ii) above as liquidated damages and not as a penalty. Notwithstanding the foregoing, the confidentiality provisions contained in the Confidentiality Agreement shall survive any such termination.

(d)

Pledged Shares. In the event that the Closing does not occur on or prior to March 31, 2007 (unless such failure results from actions of Seller), the Pledged Shares shall be assigned in full to Seller pursuant to the executed Stock Assignment Separate From Certificate held in escrow pursuant to that certain Letter of Intent dated as of May 22, 2006, as amended, by and among the parties hereto (the “Letter of Intent”). Notwithstanding the above, if the failure to so close is solely the result of Buyer’s inability to obtain the Financing after Buyer has met its obligations under Section 8(d) above, the Pledged Shares shall be returned to Xxxxxxxxx Xxxxxxxxx.

14.

MISCELLANEOUS PROVISIONS.

(a)

Further Assurances.

Each party hereto shall execute and/or cause to be delivered to each other party hereto such instruments and other documents, and shall take such other actions, as such other party may reasonably request (prior to, at or after the Closing) for the purpose of carrying out or evidencing any of the Transactions.

(b)

Entire Agreement. This Agreement (including the Exhibits and Schedules hereto) and the other Transaction Documents and the Letter of Intent set forth all of the representations, warranties, covenants, agreements, conditions and understandings among the parties hereto with respect to the subject matter hereof, and supersede all prior and contemporaneous agreements and understandings, inducements or conditions, express or implied, oral or written, with respect thereto.

(c)

Notices. Any notice or other communication required or permitted to be delivered to any party under this Agreement shall be in writing and shall be deemed properly delivered, given and received when delivered (by hand, by registered mail (return receipt requested), by courier or express delivery service or by confirmed facsimile) to the address or facsimile telephone number set forth beneath the name of such party below (or to such other address or facsimile telephone number as such party shall have specified in a written notice given to the other parties hereto):

If to the Seller:

CorCell, Inc.

0000 Xxxx Xxxxxx

Xxxxx 0000

Xxxxxxxxxxxx, XX 00000

Facsimile No.: ______________________

with a copy to:

Vita 34 International XX

Xxxxxxxxx Xxxxx 0x

00000 Xxxxxxx, Xxxxxxx

Facsimile No.: ______________________

and

Xxxxxxxx Xxxxxx LLP

3200 The Mellon Bank Center

0000 Xxxxxx Xxxxxx

Xxxxxxxxxxxx, XX 00000

Attention: Xxxx X. Xxxxxxxxx, Esquire

Facsimile No.: 215-575-7200

If to the Buyer:

Cord Blood America, Inc.

0000 Xxxxxx Xxxxxxxxx, Xxxxx 000

Xxx Xxxxxxx, XX 00000

Facsimile No.: 888-882-2673

with a copy to:

Xxxxxx Godward LLP

0000 Xxxxxxxx Xxxx

Xxx Xxxxx, XX 00000

Attention: Xxxxx Xxxxxxxx, Esquire

Facsimile No.: 000-000-0000

(d)

Successors and Assigns; Parties in Interest.

(i)

This Agreement shall be binding upon: the Seller and its successors and assigns, if any; and the Buyer and its successors and assigns, if any. This Agreement shall inure to the benefit of: the Seller, the Seller Indemnitees, the Buyer; the Buyer Indemnitees; and the respective personal representatives, heirs, successors and assigns, if any, of the foregoing.

(ii)

The Buyer may assign any or all of its rights under this Agreement, in whole or in part, to any Affiliate of the Buyer upon notice to, but without obtaining the consent of, the Seller; provided, however, that no such assignment shall cause the Buyer to be released from its

continuing obligations or liabilities under this Agreement. The Seller shall not be permitted to assign any of its rights or delegate any of its obligations under this Agreement without the prior written consent of the Buyer, which shall not be unreasonably withheld.

(iii)

Except for the provisions of Section 12 (with respect to the Indemnified Parties), none of the provisions of this Agreement is intended to provide any rights or remedies to any Person other than the parties to this Agreement and their respective personal representatives, heirs, successors and assigns, if any. Without limiting the generality of the foregoing, (i) no employee of the Seller or of the Buyer shall have any rights under this Agreement or under any of the other Transaction Documents, and (ii) no creditor of the Seller or of the Buyer shall have any rights under this Agreement or any of the other Transaction Documents.

(e)

Amendments; Waivers.

(i)

This Agreement may not be amended, modified, altered or supplemented other than by means of a written instrument duly executed and delivered on behalf of the Buyer and Seller.

(ii)

No failure on the part of any Person to exercise any power, right, privilege or remedy under this Agreement, and no delay on the part of any Person in exercising any power, right, privilege or remedy under this Agreement, shall operate as a waiver of such power, right, privilege or remedy; and no single or partial exercise of any such power, right, privilege or remedy shall preclude any other or further exercise thereof or of any other power, right, privilege or remedy.

(iii)

No Person shall be deemed to have waived any claim arising out of this Agreement, or any power, right, privilege or remedy under this Agreement, unless the waiver of such claim, power, right, privilege or remedy is expressly set forth in a written instrument duly executed and delivered on behalf of such Person; and any such waiver shall not be applicable or have any effect except in the specific instance in which it is given.

(f)

Governing Law. This Agreement shall be governed by and construed and enforced in accordance with the laws of the State of Delaware, without giving effect to the conflict of laws principles thereof.

(g)

Captions. The captions of the various sections and subsections of this Agreement have been inserted for convenience of reference only and shall not be used to interpret or construe the meaning of the terms and provisions hereof.

(h)

Severability. Any term or provision of this Agreement that is invalid or unenforceable in any situation in any jurisdiction shall not affect the validity or enforceability of the remaining terms and provisions hereof or the validity or enforceability of the offending term or provision in any other situation or in any other jurisdiction. If the final judgment of a court of competent jurisdiction declares that any term or provision hereof is invalid or unenforceable, the

parties hereto agree that the court making such determination shall have the power to limit the term or provision, to delete specific words or phrases, or to replace any invalid or unenforceable term or provision with a term or provision that is valid and enforceable and that comes closest to expressing the intention of the invalid or unenforceable term or provision, and this Agreement shall be enforceable as so modified. In the event such court does not exercise the power granted to it in the prior sentence, the parties hereto agree to replace such invalid or unenforceable term or provision with a valid and enforceable term or provision that will achieve, to the extent possible, the economic, business and other purposes of such invalid or unenforceable term.

(i)

Counterparts; Facsimile Signature. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. A facsimile of a signature shall be binding on the parties hereto.

(j)

Expenses. Whether or not the transactions contemplated hereby are consummated, subject to the indemnification obligations under Section 12 hereof, the shall pay all costs and expenses incurred by or on behalf of the Seller, and the Buyer shall pay all costs and expenses incurred by or on behalf of the Buyer, in connection with this Agreement and the other Transaction Documents and the transactions contemplated hereby and thereby, including, without limiting the generality of the foregoing, any and all fees and expenses of its own financial consultants, accountants and counsel.

(k)

Arbitration. Any claim or dispute arising out of or related to this Agreement (including unresolved disputes arising from an objection to a claim made in an Indemnification Notice, but excluding disputes arising under any other Transaction Document), the interpretation, making performance, Breach or termination thereof, shall be finally and exclusively settled by binding arbitration. The arbitration shall be made in accordance with the then current Commercial Arbitration Rules of the American Arbitration Association, and such arbitration shall be conducted by an arbitrator chosen by mutual agreement of the Buyer and the Seller; failing such agreement, the arbitration shall be conducted, by three independent arbitrators, one chosen by the Buyer and one chosen by the Seller, with such two arbitrators mutually selecting a third arbitrator, and any decision of two of such arbitrators shall be binding; provided, however, if such arbitrators fail to agree on a third arbitrator within twenty (20) calendar days, either the Buyer or the Seller may make written application to Judicial Arbitration and Mediation Services (“JAMS”), for the appointment of a single arbitrator (the “JAMS Arbitrator”) to resolve the dispute by arbitration. At the request of JAMS, the parties involved in the dispute shall meet with JAMS at its offices in the applicable city designated above within ten (10) calendar days of such request to discuss the dispute and the qualifications and experience which each party respectively believes the JAMS Arbitrator should have; provided, however, that the selection of the JAMS Arbitrator shall be the exclusive decision of JAMS and shall be made within thirty (30) days of the written application to JAMS. The arbitrator(s) shall have the authority to grant any equitable and legal remedies that would be available in any judicial proceeding to resolve the dispute. Judgment upon the award rendered by the arbitrator may be entered in any court having jurisdiction thereof. Each of the parties to any such arbitration shall pay its or his own costs and

expenses (including counsel fees) of any such arbitration. The parties hereto expressly waive all rights whatsoever to file an appeal against or otherwise to challenge any award by the arbitrator(s) hereunder; provided that, the foregoing shall not limit the rights of any party to bring a proceeding in any applicable jurisdiction to conform, enforce or enter judgment upon such award (and the rights of the other party, if such proceeding is brought, to contest such confirmation, enforcement or entry of judgment).

(l)

Construction.

(i)

For purposes of this Agreement, whenever the context requires: the singular number shall include the plural, and vice versa; the masculine gender shall include the feminine and neuter genders; the feminine gender shall include the masculine and neuter genders; and the neuter gender shall include the masculine and feminine genders.

(ii)

The parties hereto agree that any rule of construction to the effect that ambiguities are to be resolved against the drafting party shall not be applied in the construction or interpretation of this Agreement.

(iii)

As used in this Agreement, the words “include” and “including,” and variations thereof, shall not be deemed to be terms of limitation, but rather shall be deemed to be followed by the words “without limitation.”

(iv)

Except as otherwise indicated, all references in this Agreement to “Sections” and “Exhibits” are intended to refer to Sections of this Agreement and Exhibits to this Agreement.

(m)

Remedies Cumulative; Specific Performance. The rights and remedies of the parties hereto shall be cumulative and not alternative, and the parties hereto agree that: (a) in the event of any Breach or threatened Breach by any party hereto of any covenant, obligation or other provision set forth in this Agreement, the other party shall be entitled (in addition to any other remedy that may be available to it) to (i) a decree or order of specific performance or mandamus to enforce the observance and performance of such covenant, obligation or other provision, and (ii) an injunction restraining such Breach or threatened Breach; and (b) neither such other party nor any other Indemnitee shall be required to provide any bond or other security in connection with any such decree, order or injunction or in connection with any related action or Proceeding.

15.

DEFINITIONS.

As used in this Agreement:

“Acquired Assets” shall have the meaning set forth in Section 1(a) of this Agreement.

“Acquired Business” shall meaning set forth in the Background section of this Agreement.

“Acquired Business Contract” shall have the meaning set forth in Section 5(q) of this Agreement.

“Acquired Samples” shall mean all umbilical cord blood samples involved in the Acquired Business, which equals approximately 11,0000 samples under annual renewal contracts, and the related contracts.

“Acquired Sample Transfer” shall have the meaning set forth in Section 10(r) of this Agreement.

“Acquisition Transaction” shall mean any transaction involving:

(i)

the sale, license, disposition or acquisition of all or substantially all of the assets or Acquired Business of the Seller;

(ii)

the issuance, disposition or acquisition of (i) any capital stock or other equity security of the Seller (other than common stock issued to employees of the Seller, upon exercise of stock options or otherwise, in routine transactions in accordance with the Seller’s past practices), (ii) any option, call, warrant or right (whether or not immediately exercisable) to acquire any capital stock or other equity security of the Seller (other than stock options granted to employees of the Seller in routine transactions in accordance with the Seller’s past practices), or (iii) any security, instrument or obligation that is or may become convertible into or exchangeable for any capital stock or other equity security of the Seller; or

(iii)

any merger, consolidation, business combination, reorganization or similar transaction involving the Seller.

“Affiliate” shall mean, with respect to a Person, any Person controlling, controlled by or under common control with such Person. For the purposes of this definition, the term “control” (including the terms “controlling”, “controlled by” and “under common control with”) means the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting securities, by contract, or otherwise.

“Agreement” shall mean this Asset Purchase Agreement (including the Schedules hereto), as it may be amended from time to time.

“Affected Party” shall have the meaning set forth in Section (9)(d)(ii)(B) of this Agreement.

“Assignment and Assumption Agreement” shall have the meaning set forth in Section 4(b)(iii) of this Agreement.

“Assumed Obligations” shall have the meaning set forth in Section 2(a) of this Agreement.

“Basket” shall have the meaning set forth in Section 12(d)(i) of this Agreement.

“Xxxx of Sale” shall have the meaning set forth in Section 4(b)(i) of this Agreement.

“Board” shall have the meaning set forth in Section 8(h) of this Agreement.

“Breach” There shall be deemed to be a “Breach” of a representation, warranty, covenant, obligation or other provision if there is or has been any inaccuracy in or breach (including any inadvertent or innocent breach) of, or any failure (including any inadvertent failure) to comply with or perform, such representation, warranty, covenant, obligation or other provision.

“Common Stock” shall have the meaning set forth in Section 3(a)(ii) of this Agreement.

“Buyer Indemnitees” shall have the meaning set forth in Section 12(a) of this Agreement.

“Cash Consideration” shall have the meaning set forth in Section 3(a)(i) of this Agreement.

“Closing” shall have the meaning set forth in Section 4(a) of this Agreement.

“Closing Date” shall have the meaning set forth in Section 4(a) of this Agreement.

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

“Confidential Information” shall mean all information concerning or related to the business, operations, financial condition or prospects of such party or any of its Affiliates, regardless of the form in which such information appears and whether or not such information has been reduced to a tangible form, and shall specifically include (i) all information regarding the officers, directors, employees, equity holders, customers, suppliers, distributors, sales representatives and licensees of such party and its Affiliates, in each case whether present or prospective, (ii) all inventions, discoveries, trade secrets, processes, techniques, methods, formulae, ideas and know-how of such party and its Affiliates, (iii) all financial statements, audit reports, budgets and business plans or forecasts of such party and its Affiliates and (iv) all information concerning or related to the transactions contemplated hereby; provided that the Confirmation Information of a party shall not include (a) information which is or becomes generally known to the public through no act or omission of the receiving party and (b) information which has been or hereafter is lawfully obtained by the receiving party from a source other than the party to which such Confidential Information belongs (or any of its Affiliates or their respective officers, directors, employees, equity holders or agents) so long as, in the case of information obtained from a third party, such third party was or is not, directly or indirectly, subject to an obligation of confidentiality owed to the party to whom such Confidential Information belongs or any of its Affiliates at the time such Confidential Information was or is disclosed to the other party.

“Confidentiality Agreement” shall have the meaning set forth in Section 7(a) of this Agreement.

“Consent” shall mean any approval, consent, ratification, permission, waiver, authorization, filing, registration or notification (including any Governmental Authorization).

“Contract” shall mean any written, oral, implied or other agreement, contract, understanding, arrangement, instrument, note, guaranty, indemnity, representation, warranty, deed, assignment, power of attorney, certificate, purchase order, work order, insurance policy, benefit plan, commitment, covenant, assurance or undertaking of any nature.

“Defense” shall have the meaning set forth in Section 12(c)(ii) of this Agreement.

“Disclosing Party” shall have the meaning set forth in Section 9(d)(ii)(B) of this Agreement.

“Excluded Assets” shall have the meaning set forth in Section 1(b) of the Agreement.

“Excluded Liabilities” shall have the meaning set forth in Section 2(b) of this Agreement.

“Financial Statements” shall have the meaning set forth in Section 5(j) of this Agreement.

“Financing” shall have the meaning set forth in Section 10(h) of this Agreement.

“Governmental Authorization” shall mean any: (a) permit, license, certificate, franchise, concession, approval, consent, ratification, permission, clearance, confirmation, endorsement, waiver, certification, designation, rating, registration, qualification or authorization issued, granted, given or otherwise made available by or under the authority of any Governmental Body or pursuant to any Legal Requirement; or (b) right under any Contract with any Governmental Body.

“Governmental Body” shall mean any: (a) nation, principality, state, commonwealth, province, territory, county, municipality, district or other jurisdiction of any nature; (b) federal, state, local, municipal, foreign or other government; (c) governmental or quasi governmental authority of any nature (including any governmental division, subdivision, department, agency, bureau, branch, office, commission, council, board, instrumentality, officer, official, representative, organization, unit, body or other entity and any court or other tribunal); (d) multi-national organization or body; or (e) individual, body or other entity exercising, or entitled to exercise, any executive, legislative, judicial, administrative, regulatory, police, military or taxing authority or power of any nature.

“Hazardous Material” shall mean (a) materials which are listed or otherwise defined as “hazardous” or “toxic” under any applicable local, state, federal and/or foreign laws and regulations that govern the existence and/or remedy of contamination on property, the protection of the environment from contamination, the control of hazardous wastes, or other activities

involving hazardous substances, including building materials, or (b) any petroleum products or nuclear materials.

“Indemnification Matter” shall have the meaning set forth in Section 12(c) of this Agreement.

“Indemnification Notice” shall have the meaning set forth in Section 12(c)(i) of this Agreement.

“Indemnitee” shall have the meaning set forth in Section 12(c) of this Agreement.

“Indemnitor” shall have the meaning set forth in Section 12(c) of this Agreement.

“Interim Statements” shall have the meaning set forth in Section 5(j) of this Agreement.

“JAMS” and “JAMS Arbitrator” shall have the meanings set forth in Section 14(k) of this Agreement.

“Knowledge” Seller shall be deemed to have “knowledge” of a particular fact or other matter if any current or former employee employed by the Seller within the twelve (12) months preceding the date hereof has knowledge of such fact or other matter.

“Legal Requirement” shall mean any federal, state, local, municipal, foreign or other law, statute, legislation, constitution, principle of common law, resolution, ordinance, code, edict, decree, proclamation, treaty, convention, rule, regulation, ruling, directive, pronouncement, requirement, specification, determination, decision, opinion or interpretation issued, enacted, adopted, passed, approved, promulgated, made, implemented or otherwise put into effect by or under the authority of any Governmental Body.

“Letter of Intent” shall have the meaning set forth in Section 13(d) of this Agreement.

“Losses” shall have the meaning set forth in Section 12(a) of this Agreement.

“Material Adverse Effect”: an event, violation, inaccuracy, circumstance or other matter will be deemed to have a “Material Adverse Effect” on the Acquired Business if such event, violation, inaccuracy, circumstance or other matter (considered together with all other matters that would constitute exceptions to the representations and warranties set forth in the Agreement but for the presence of “Material Adverse Effect” or other materiality qualifications, or any similar qualifications, in such representations and warranties) had or could reasonably be expected to have or give rise to a material adverse effect on (i) the business, condition, assets, liabilities, prospects, operations or financial performance of the Acquired Business, (ii) the ability of the Buyer to use the Acquired Assets after the Closing, or (iii) the ability of the Seller to consummate the transactions contemplated by any of the Transaction Documents or to perform any of its obligations under this Agreement prior to the Termination Date. An event, violation, inaccuracy, circumstance or other matter will be deemed to have a “Material Adverse

Effect” on the Buyer if such event, violation, inaccuracy, circumstance or other matter (considered together with all other matters that would constitute exceptions to the representations and warranties set forth in the Agreement but for the presence of “Material Adverse Effect” or other materiality qualifications, or any similar qualifications, in such representations and warranties) had or could reasonably be expected to have or give rise to a material adverse effect on the ability of the Buyer to consummate the transactions contemplated by any of the Transaction Documents or to perform any of its obligations under this Agreement prior to the Termination Date. Notwithstanding the foregoing, in no event shall any of the following, alone or in combination, be deemed to constitute, nor shall any of the following be taken into account in determining whether there has been or will be, a Material Adverse Effect on the Acquired Business or the Buyer: (i) any change resulting from compliance with the terms and conditions of the Transaction Documents; or (ii) any change or effect that results or arises from changes affecting the United States or general worldwide economic or capital market conditions.

“Nontransferred Assets” shall have the meaning set forth in Section 4(c) of this Agreement.

“Order” shall mean any: (a) order, judgment, injunction, edict, decree, ruling, pronouncement, determination, decision, opinion, verdict, sentence, subpoena, writ or award issued, made, entered, rendered or otherwise put into effect by or under the authority of any court, administrative agency or other Governmental Body or any arbitrator or arbitration panel; or (b) Contract with any Governmental Body entered into in connection with any Proceeding.

“Ordinary Course of Business”: an action taken by or on behalf of the Seller shall not be deemed to have been taken in the “Ordinary Course of Business” unless such action is recurring in nature, is consistent with the past practices of the Seller in the conduct of the Acquired Business and is taken in the ordinary course of the normal day-to-day operations of the Acquired Business.

“Person” shall mean any individual, corporation, partnership, limited liability company, joint venture, estate, trust, cooperative, foundation, firm or other enterprise, association,

“Pledged Shares” shall mean the shares placed in escrow by Xxxxxxxxx Xxxxxxxxx, on behalf of Buyer, pursuant to the Letter of Intent.

“Pre-Closing Period” shall mean the period commencing on the date of the Agreement through the earlier of the Closing Date or the termination of this Agreement in accordance with the terms hereof.

“Proceeding” shall mean any claim, action, suit, litigation, arbitration, proceeding (including any civil, criminal, administrative, investigative or appellate proceeding and any informal proceeding), prosecution, contest, hearing, inquiry, inquest, audit, examination or investigation commenced, brought, conducted or heard by or before, or otherwise involving, any Governmental Body or any arbitrator or arbitration panel.

“Proprietary Rights” shall have the meaning set forth in Section 5(h) of this Agreement.

“Purchase Price” shall have the meaning set forth in Section 3(a) of this Agreement.

“Records” shall mean: all records, original documents, files and papers of the Seller or any of its Affiliates necessary for the conduct of the Acquired Business, whether in hard copy or electronic format, in the possession or control of the Seller or its Affiliates at the Closing Date related to customer or prospective customer files or lists, inventory records, copies of sales and sales promotional data, copies of advertising materials, customer lists, cost and pricing information, supplier lists and any other similar records.

“Registered Shares” shall have the meaning set forth in Section 9(g) of this Agreement.

“Registration Statement” shall have the meaning set forth in Section 9(g) of this Agreement.

“Representative” shall mean officers, directors, employees, agents, attorneys, accountants, advisors and representatives.

“Schedules” shall have the meaning set forth in Section 5 of this Agreement.

“SEC” shall have the meaning set forth in Section 9(g) of this Agreement.

“Securities Act” shall mean the Securities Act of 1933, as amended.

“Seller Indemnitees” shall have the meaning set forth in Section 12(b) of this Agreement.

“Stock Consideration” shall have the meaning set forth in Section 3(a)(ii) of this Agreement.

“Tax”, “Taxes” and “Tax Returns” shall have the meanings set forth in Section 5(o)(i) of this Agreement.

“Transaction Documents” shall mean: (a) this Agreement; (b) the Xxxx of Sale and (c) the Assignment and Assumption Agreement.

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IN WITNESS WHEREOF, the parties have caused this Agreement to be executed and delivered as of the date first set forth above.

SELLER:


	CORCELL, INC., a Delaware corporation

	By:	/s/ Xxxxxx X. Xxxxxxx
	Name:	Xxxxxx X. Xxxxxxx
	Title:	President

BUYER:


	CORD BLOOD AMERICA, INC., a Florida corporation

	By:	/s/ Xxxxxxx Xxxxxxxxx
	Name:	Xxxxxxx Xxxxxxxxx
	Title:	Chairman and Chief Executive Officer

EXHIBITS

Exhibit A

Form of Xxxx of Sale

Exhibit B

Form of Assignment and Assumption Agreement

Exhibit C

Intentionally Omitted

Exhibit D

Form(s) of Seller Participation Agreements

Exhibit E

Form(s) of Contribution Agreements

EXHIBIT A

FORM OF XXXX OF SALE

EXHIBIT B

FORM OF ASSIGNMENT AND ASSUMPTION AGREEMENT

EXHIBIT C

INTENTIONALLY OMITTED

EXHIBIT D

FORM(S) OF SELLER PARTICIPATION AGREEMENTS

EXHIBIT D

FORM OF CONTRIBUTION AGREEMENTS

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Table of Contents

EXISTING SAMPLES PURCHASE AGREEMENT

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