Exhibit 10.1

ASSET PURCHASE AGREEMENT

This ASSET PURCHASE AGREEMENT (the “Agreement”) is made as of October 27, 2006,
by and between DynTek, Inc., a Delaware corporation (“Parent”), DynTek Canada
Inc., an Ontario corporation and wholly owned subsidiary of Parent (“Buyer”),
Sensible Security Solutions Inc., an Ontario corporation (“Seller”), 3849597
Canada Inc., a Canadian corporation (the “Shareholder”) and Paul Saucier, a
natural person who is the President of Seller and who owns indirectly all of the
issued and outstanding common shares of Seller (the “Principal Owner” and
collectively with the Shareholder, the “Principal Owners”).  Capitalized terms
used herein and not defined herein are defined in Exhibit A attached hereto.

R E C I T A L S

WHEREAS, Seller is engaged in the business of providing information technology
service offerings including, among other things, hardware and software
management and integration, network and custom software design, project
management and consulting services (the “Business”);

WHEREAS, Buyer desires to purchase and Seller desires to sell to Buyer
substantially all of the assets of the Business, subject to the terms and
conditions of this Agreement; and

WHEREAS, the Board of Directors of Parent and Buyer, in accordance with the laws
of their respective jurisdictions of organization and their respective charter
documents, and the Board of Directors and the sole shareholder of Seller, in
accordance with the laws of the Province of Ontario and Seller’s constating
documents, have approved this Agreement upon the terms and subject to the
conditions set forth in this Agreement.

A G R E E M E N T

NOW, THEREFORE, in consideration of the terms, covenants, and conditions
hereinafter set forth, the parties hereto agree as follows:

ARTICLE I

PURCHASE OF ASSETS; ASSUMPTION OF LIABILITIES

1.1          PURCHASED ASSETS.  SUBJECT TO THE TERMS AND CONDITIONS OF THIS
AGREEMENT, BUYER HEREBY AGREES TO PURCHASE FROM SELLER, AND SELLER HEREBY AGREES
TO SELL, CONVEY, TRANSFER AND ASSIGN TO BUYER, ON THE CLOSING DATE (AS
HEREINAFTER DEFINED), ALL OF SELLER’S RIGHT, TITLE AND INTEREST IN AND TO THE
ASSETS OF SELLER USED IN CONNECTION WITH THE BUSINESS, OTHER THAN THE EXCLUDED
ASSETS (COLLECTIVELY, THE “PURCHASED ASSETS”), FREE AND CLEAR OF ANY AND ALL
ENCUMBRANCES, EXCEPT FOR THE PERMITTED ENCUMBRANCES (AS HEREINAFTER DEFINED) SET
FORTH ON SCHEDULE 1.1 AND OTHER THAN THE RESTRICTIONS ON THE TRANSFER OF THE
ASSIGNED CONTRACTS.  THE PURCHASED ASSETS SHALL INCLUDE, BUT SHALL NOT BE
LIMITED TO, THE FOLLOWING:

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(A)           ALL OF SELLER’S RIGHTS AND OBLIGATIONS UNDER ALL OF THE AGREEMENTS
OF THE SELLER RELATING TO THE BUSINESS, ALL OF WHICH ARE IDENTIFIED ON SCHEDULE
1.1(A) ATTACHED HERETO (COLLECTIVELY THE “ASSIGNED CONTRACTS”);

(B)           ALL OF SELLER’S ACCOUNTS OR NOTES RECEIVABLE FROM AND INCLUDING
OCTOBER 1, 2006, AND ALL CASH AND CASH EQUIVALENTS, RELATED TO THE BUSINESS, ALL
OF WHICH ARE IDENTIFIED ON SCHEDULE 1.1(B) ATTACHED HERETO AND ALL SCHEDULES,
RECORDS AND OTHER DOCUMENTATION RELATED TO SUCH ACCOUNTS OR NOTES RECEIVABLE,
AND CASH OR CASH EQUIVALENTS;

(C)           ALL OF SELLER’S SUPPLIES, COMPUTERS, EQUIPMENT, FURNITURE AND
FIXTURES, AND ALL OTHER TANGIBLE PERSONAL PROPERTY OWNED BY SELLER AND USED IN
CONNECTION WITH THE CONDUCT OF THE BUSINESS, ALL OF WHICH, TO THE EXTENT EACH
INDIVIDUAL ASSET HAS AN UNDEPRECIATED VALUE IN EXCESS OF TWO THOUSAND FIVE
HUNDRED DOLLARS ($2,500), SHALL BE IDENTIFIED IN THE FIXED ASSET SCHEDULE TO BE
ATTACHED HERETO AS SCHEDULE 1.1(C) (THE “FIXED ASSETS”);

(D)           ALL OF SELLER’S BOOKS AND RECORDS DIRECTLY RELATED TO, OR USED IN
CONNECTION WITH, THE CONDUCT OF THE BUSINESS OR PERTAINING TO THE PURCHASED
ASSETS, REGARDLESS OF THE MEDIUM ON WHICH SUCH INFORMATION IS STORED OR
MAINTAINED INCLUDING, WITHOUT LIMITATION, ALL CUSTOMER AND EMPLOYMENT RECORDS,
VENDOR INFORMATION AND CONTRACTS, BUSINESS PLANS AND STRATEGIES, FINANCIAL AND
OPERATIONAL DATA AND REPORTS, AND MARKETING INFORMATION AND MATERIALS;

(E)           TO THE EXTENT TRANSFERABLE, ALL OF SELLER’S LICENSES, PERMITS OR
OTHER AUTHORIZATIONS OF GOVERNMENTAL OR REGULATORY ENTITIES THAT ARE REQUIRED
UNDER ANY LAWS, RULES AND REGULATIONS APPLICABLE TO OR AFFECTING THE BUSINESS,
ALL OF WHICH ARE SET FORTH ON SCHEDULE 1.1(E);

(F)            ALL OF SELLER’S OWNED AND LEASED REAL PROPERTY, INCLUDING ANY
LEASEHOLD IMPROVEMENTS THEREON, ALL OF WHICH ARE IDENTIFIED IN THE REAL PROPERTY
SCHEDULE ATTACHED HERETO AS SCHEDULE 1.1(F);

(G)           ALL OF SELLER’S INVENTORY, A DETAILED LIST OF WHICH SHALL BE SET
FORTH ON SCHEDULE 1.1(G);

(H)           ALL OF SELLER’S INTELLECTUAL PROPERTY RIGHTS WHICH ARE SET FORTH
ON SCHEDULE 1.1(H);

(I)            ALL INSURANCE BENEFITS, INCLUDING RIGHTS AND PROCEEDS, ARISING
FROM OR RELATING TO THE PURCHASED ASSETS OR THE ASSUMED OBLIGATIONS (AS DEFINED
HEREIN);

(J)             ALL ADVANCE PAYMENTS, CLAIMS FOR REFUNDS, DEPOSITS AND OTHER
PREPAID ITEMS AS OF THE CLOSING DATE;

(K)           ALL OF SELLER’S CLAIMS, INCLUDING CLAIMS AGAINST THIRD PARTIES,
RELATING TO THE PURCHASED ASSETS, WHETHER CHOATE OR INCHOATE, KNOWN OR UNKNOWN,
CONTINGENT OR ASCERTAINED; AND

(L)            THE GOODWILL ASSOCIATED WITH THE PURCHASED ASSETS AND THE
BUSINESS.

1.2          EXCLUDED ASSETS.  THE PURCHASED ASSETS BEING PURCHASED BY BUYER
HEREUNDER SHALL INCLUDE ALL OF THE ASSETS OF SELLER WITH THE EXCEPTION OF THE
PARTICULAR ASSETS SET FORTH ON SCHEDULE 1.2, WHICH ASSETS SHALL BE RETAINED BY
SELLER (COLLECTIVELY, THE “EXCLUDED ASSETS”).

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1.3          ASSUMED OBLIGATIONS.  BUYER HEREBY AGREES TO ASSUME ONLY THOSE
OBLIGATIONS AT THE CLOSING AND EFFECTIVE AS OF THE EFFECTIVE TIME, AND AGREES TO
PAY, PERFORM AND DISCHARGE ONLY THOSE LIABILITIES AND OBLIGATIONS ACCRUING DUE
AND RELATING TO THE PERIOD SUBSEQUENT TO THE EFFECTIVE TIME UNDER THE ASSIGNED
CONTRACTS AND THE ACCOUNTS PAYABLE SPECIFICALLY IDENTIFIED ON SCHEDULE 1.3
(COLLECTIVELY, THE “ASSUMED OBLIGATIONS”).  THE ASSUMED OBLIGATIONS SHALL ONLY
INCLUDE THOSE OBLIGATIONS OR LIABILITIES ARISING OUT OF ANY DEFAULT UNDER ANY
ASSUMED OBLIGATION THAT OCCURS SUBSEQUENT TO THE EFFECTIVE TIME, AND BUYER SHALL
NOT BE OBLIGATED TO ASSUME ANY ASSUMED OBLIGATION WHICH IS IN DEFAULT PRIOR TO
THE CLOSING DATE, OR WHICH DEFAULT ARISES FROM THE OPERATIONS OF SELLER PRIOR TO
THE EFFECTIVE TIME, UNLESS OTHERWISE EXPRESSLY PROVIDED FOR IN THIS AGREEMENT.

1.4          LIABILITIES NOT BEING ASSUMED.  EXCEPT FOR THE ASSUMED OBLIGATIONS,
SELLER AGREES THAT BUYER SHALL NOT BE OBLIGATED TO ASSUME OR PERFORM, AND IS NOT
ASSUMING OR PERFORMING, ANY LIABILITIES OR OBLIGATIONS OF SELLER, WHETHER KNOWN
OR UNKNOWN, FIXED OR CONTINGENT, CERTAIN OR UNCERTAIN, AND REGARDLESS OF WHEN
SUCH LIABILITIES OR OBLIGATIONS MAY ARISE OR MAY HAVE ARISEN OR WHEN THEY ARE OR
WERE ASSERTED (THE “RETAINED LIABILITIES”), AND SELLER SHALL REMAIN RESPONSIBLE
FOR ALL RETAINED LIABILITIES, WHICH SHALL INCLUDE, WITHOUT LIMITATION, ANY AND
ALL OF THE FOLLOWING OBLIGATIONS OR LIABILITIES OF SELLER:

(A)           ANY COMPENSATION OR BENEFITS PAYABLE TO PRESENT OR PAST EMPLOYEES
OF SELLER ARISING IN CONNECTION WITH THEIR EMPLOYMENT BY SELLER, INCLUDING
WITHOUT LIMITATION, ANY LIABILITIES ARISING UNDER THE EMPLOYMENT STANDARDS ACT
(ONTARIO), ANY EMPLOYEE PENSION OR PROFIT SHARING PLAN OR OTHER EMPLOYEE BENEFIT
PLAN AND ANY OF SELLER’S OBLIGATIONS FOR VACATION, HOLIDAY OR SICK PAY, ANY
OBLIGATIONS UNDER ANY EMPLOYMENT, CONSULTING OR NON-COMPETITION AGREEMENT TO
WHICH SELLER IS A PARTY, WHETHER WRITTEN OR ORAL, AND ANY LIABILITIES OR
OBLIGATIONS ARISING OUT OF THE TERMINATION BY SELLER OF ANY OF ITS EMPLOYEES IN
ANTICIPATION OR AS A CONSEQUENCE OF, OR FOLLOWING, CONSUMMATION OF THE
TRANSACTIONS CONTEMPLATED HEREBY;

(B)           ALL FEDERAL, PROVINCIAL, LOCAL, FOREIGN OR OTHER TAXES (I) THAT
HAVE ARISEN PRIOR TO THE CLOSING DATE OR MAY ARISE THEREAFTER OUT OF BUSINESS OR
OTHER OPERATIONS CONDUCTED BY SELLER EITHER PRIOR TO OR AFTER THE CLOSING DATE,
OR (II) FOR WHICH SELLER IS OR, AT ANY TIME HEREAFTER, MAY BECOME LIABLE;
PROVIDED, HOWEVER, THAT THE RETAINED LIABILITIES SHALL NOT INCLUDE ANY TAXES
ARISING OUT OF THE CONDUCT BY BUYER, ON OR AFTER THE CLOSING DATE, OF THE
BUSINESS, OR THE OWNERSHIP, ON OR AFTER THE CLOSING DATE, OF THE PURCHASED
ASSETS;

(C)           ALL ENCUMBRANCES EXCEPT FOR THE PERMITTED ENCUMBRANCES ON ANY OF
THE PURCHASED ASSETS AND ALL OBLIGATIONS AND LIABILITIES SECURED THEREBY THAT
ARE NOT ASSUMED OBLIGATIONS;

(D)           ALL ACCOUNTS OR NOTES PAYABLE OBLIGATIONS FOR BORROWED MONEY, ALL
PURCHASE MONEY OBLIGATIONS AND ANY OTHER INDEBTEDNESS OR PAYMENT OBLIGATIONS OF
SELLER, OTHER THAN THOSE SPECIFICALLY IDENTIFIED ON SCHEDULE 1.3; AND

(E)           ANY CLAIMS, DEMANDS, ACTIONS, SUITS OR LEGAL PROCEEDINGS THAT HAVE
BEEN ASSERTED OR THREATENED PRIOR TO THE CLOSING DATE AGAINST SELLER, THE
BUSINESS OR THE PURCHASED ASSETS OR WHICH MAY BE ASSERTED OR THREATENED
HEREAFTER AGAINST THE PURCHASED ASSETS, THE BUSINESS OR BUYER THAT ARISE IN ANY
WAY FROM OR IN CONNECTION WITH SELLER’S OPERATION OF THE BUSINESS PRIOR TO THE
CLOSING DATE.

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ARTICLE II

CONSIDERATION FOR PURCHASED ASSETS

2.1          PURCHASE PRICE.  AS CONSIDERATION FOR (I) THE SALE TO BUYER OF THE
PURCHASED ASSETS, AND (II) THE ASSUMPTION OF THE ASSUMED LIABILITIES, BUYER
SHALL PAY SELLER THE “CLOSING CONSIDERATION” SET FORTH IN SECTION 2.2 BELOW AND
THE “EBITDA EARN-OUT CONSIDERATION” SET FORTH IN SECTION 2.3 BELOW
(COLLECTIVELY, THE “PURCHASE PRICE”).

2.2          CLOSING CONSIDERATION.  ON THE CLOSING DATE, BUYER SHALL PAY TO
SELLER EACH OF THE FOLLOWING:

(A)           A CASH PAYMENT OF ONE MILLION TWO HUNDRED THOUSAND DOLLARS
($1,200,000), WHICH SHALL BE ADJUSTED IN ACCORDANCE WITH SECTION 2.7 AND REDUCED
BY THE AMOUNT USED BY BUYER TO PAY OFF THE SECURED OBLIGATIONS (AS DEFINED
BELOW) AS SET FORTH IN SECTION 8.8 (THE “CASH CONSIDERATION”).  THE CASH
CONSIDERATION SHALL BE SENT BY WIRE TRANSFER OF IMMEDIATELY AVAILABLE FUNDS TO
AN ACCOUNT DESIGNATED BY SELLER.

(B)           A PAYMENT OF SUCH NUMBER OF SHARES OF PARENT’S COMMON STOCK (THE
“COMMON STOCK”) EQUAL TO THREE HUNDRED THOUSAND DOLLARS ($300,000) DIVIDED BY
THE AVERAGE PER SHARE PRICE.  FOR PURPOSES OF THIS SECTION 2.2 ONLY, THE
“AVERAGE PER SHARE PRICE” MEANS THE AVERAGE OF THE CLOSING PRICES PER SHARE OF
THE COMMON STOCK AS REPORTED ON THE OVER-THE-COUNTER BULLETIN BOARD (“OTC”)
DURING THE FIFTEEN (15) TRADING DAYS PRECEDING THE CLOSING DATE, PROVIDED,
HOWEVER, THAT IN NO EVENT SHALL THE AVERAGE PER SHARE PRICE BE LESS THAN FIFTEEN
CENTS ($0.15) OR MORE THAN TWENTY FIVE CENTS ($0.25).

2.3          EBITDA EARN-OUT CONSIDERATION.  IN ADDITION TO THE PAYMENTS TO BE
MADE TO SELLER PURSUANT TO SECTION 2.2 ABOVE, ON THE TERMS AND SUBJECT TO THE
CONDITIONS OF THIS SECTION 2.3, SELLER SHALL BE ENTITLED TO RECEIVE CERTAIN
ADDITIONAL PAYMENTS (EACH AN “EBITDA EARN-OUT PAYMENT” AND COLLECTIVELY THE
“EBITDA EARN-OUT PAYMENTS”) CONTINGENT UPON THE ACHIEVEMENT OF SPECIFIED EBITDA
(AS HEREINAFTER DEFINED) TARGETS AS MORE FULLY DESCRIBED HEREIN.

(A)           FOR THE PERIOD FROM OCTOBER 1, 2006 THROUGH DECEMBER 31, 2006 (THE
“FIRST QUARTER”), BUYER SHALL PAY TO SELLER $1,000,000;

(I)            MINUS THE DIFFERENCE BETWEEN: (A) $1,000,000; AND (B) EBITDA
EARNED BY THE COMBINED OPERATION OF THE PURCHASED ASSETS AND BUYER’S OPERATIONS
IN CANADA (COLLECTIVELY THE “CANADIAN BUSINESS”) DURING THE FIRST QUARTER
(“FIRST QUARTER EBITDA”); AND

(II)           MINUS: (A) IF FIRST QUARTER EBITDA EARNED BY THE CANADIAN
BUSINESS IS LESS THAN $125,000, THE FULL AMOUNT OF THE FIRST QUARTER EBITDA
EARNED BY THE CANADIAN BUSINESS; (B) IF FIRST QUARTER EBITDA EARNED BY THE
CANADIAN BUSINESS IS GREATER THAN $125,000 AND LESS THAN $250,000, $1.00 FOR
EACH DOLLAR THAT FIRST QUARTER EBITDA EARNED BY THE CANADIAN BUSINESS IS LESS
THAN $250,000 (NOT TO EXCEED $125,000); OR (C) IF FIRST QUARTER EBITDA EARNED BY
THE CANADIAN BUSINESS IS EQUAL TO OR GREATER THAN $250,000 THEN BY ZERO DOLLARS.

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(III)          THE CONSIDERATION TO BE PAID, IF ANY, PURSUANT TO THIS
SECTION 2.3(A) SHALL BE REFERRED TO AS THE “FIRST QUARTER EBITDA CONSIDERATION.”

(B)           FOR THE PERIOD FROM OCTOBER 1, 2006 THROUGH MARCH 31, 2007 (THE
“SECOND QUARTER”), BUYER SHALL PAY TO SELLER $2,000,000;

(I)            MINUS THE DIFFERENCE BETWEEN: (A) $2,000,000; AND (B) EBITDA
EARNED BY THE CANADIAN BUSINESS DURING THE SECOND QUARTER (“SECOND QUARTER
EBITDA”);

(II)           MINUS: (A) IF SECOND QUARTER EBITDA EARNED BY THE CANADIAN
BUSINESS IS LESS THAN $250,000, THE FULL AMOUNT OF THE SECOND QUARTER EBITDA
EARNED BY THE CANADIAN BUSINESS; (B) IF SECOND QUARTER EBITDA EARNED BY THE
CANADIAN BUSINESS IS GREATER THAN $250,000 AND LESS THAN $500,000, $1.00 FOR
EACH DOLLAR THAT SECOND QUARTER EBITDA EARNED BY THE CANADIAN BUSINESS IS LESS
THAN $500,000 (NOT TO EXCEED $250,000); OR (C) IF SECOND QUARTER EBITDA EARNED
BY THE CANADIAN BUSINESS IS EQUAL TO OR GREATER THAN $500,000 THEN BY ZERO
DOLLARS; AND

(III)          MINUS THE FIRST QUARTER EBITDA CONSIDERATION

(IV)          THE CONSIDERATION TO BE PAID, IF ANY, PURSUANT TO THIS
SECTION 2.3(B) SHALL BE REFERRED TO AS THE “SECOND QUARTER EBITDA CONSIDERATION.

(C)           FOR THE PERIOD FROM OCTOBER 1, 2006 THROUGH JUNE 30, 2007 (THE
“THIRD QUARTER”), BUYER SHALL PAY TO SELLER $3,000,000;

(I)            MINUS THE DIFFERENCE BETWEEN: (A) $3,000,000; AND (B) EBITDA
EARNED BY THE CANADIAN BUSINESS DURING THE THIRD QUARTER (“THIRD QUARTER
EBITDA”);

(II)           MINUS: (A) IF THIRD QUARTER EBITDA EARNED BY THE CANADIAN
BUSINESS IS LESS THAN $375,000, THE FULL AMOUNT OF THE THIRD QUARTER EBITDA
EARNED BY THE CANADIAN BUSINESS; (B) IF THIRD QUARTER EBITDA EARNED BY THE
CANADIAN BUSINESS IS GREATER THAN $375,000 AND LESS THAN $750,000, $1.00 FOR
EACH DOLLAR THAT THIRD QUARTER EBITDA EARNED BY THE CANADIAN BUSINESS IS LESS
THAN $750,000 (NOT TO EXCEED $375,000); OR (C) IF THIRD QUARTER EBITDA EARNED BY
THE CANADIAN BUSINESS IS EQUAL TO OR GREATER THAN $750,000 THEN BY ZERO DOLLARS;
AND

(III)          MINUS THE AGGREGATE OF THE FIRST QUARTER EBITDA CONSIDERATION AND
THE SECOND QUARTER EBITDA CONSIDERATION.

(IV)          THE CONSIDERATION TO BE PAID, IF ANY, PURSUANT TO THIS
SECTION 2.3(C) SHALL BE REFERRED TO AS THE “THIRD QUARTER EBITDA CONSIDERATION.”

(D)           FOR THE PERIOD FROM OCTOBER 1, 2006 THROUGH SEPTEMBER 30, 2007
(THE “FOURTH QUARTER”), BUYER SHALL PAY TO SELLER $4,000,000;

(I)            MINUS THE DIFFERENCE BETWEEN: (A) $4,000,000; AND (B) EBITDA
EARNED BY THE CANADIAN BUSINESS DURING THE FOURTH QUARTER (“FOURTH QUARTER
EBITDA”); AND

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(II)           MINUS: (A) IF FOURTH QUARTER EBITDA EARNED BY THE CANADIAN
BUSINESS IS LESS THAN $500,000, THE FULL AMOUNT OF THE FOURTH QUARTER EBITDA
EARNED BY THE CANADIAN BUSINESS; (B) IF FOURTH QUARTER EBITDA EARNED BY THE
CANADIAN BUSINESS IS GREATER THAN $500,000 AND LESS THAN $1,000,000, $1.00 FOR
EACH DOLLAR THAT FOURTH QUARTER EBITDA EARNED BY THE CANADIAN BUSINESS IS LESS
THAN $1,000,000 (NOT TO EXCEED $500,000); OR (C) IF FOURTH QUARTER EBITDA EARNED
BY THE CANADIAN BUSINESS IS EQUAL TO OR GREATER THAN $1,000,000 THEN BY ZERO
DOLLARS.

(III)          MINUS THE AGGREGATE OF THE FIRST QUARTER EBITDA CONSIDERATION,
THE SECOND QUARTER EBITDA CONSIDERATION AND THE THIRD QUARTER EBITDA
CONSIDERATION

(IV)          THE CONSIDERATION TO BE PAID, IF ANY, PURSUANT TO THIS
SECTION 2.3(D) SHALL BE REFERRED TO AS THE “FOURTH QUARTER EBITDA
CONSIDERATION.”

(V)           IN THE EVENT THAT THE FOURTH QUARTER EBITDA CONSIDERATION IS A
POSITIVE NUMBER, THE SELLER SHALL RECEIVE SUCH AMOUNT IN ACCORDANCE WITH SECTION
2.5 BELOW.  IN THE EVENT THAT THE FOURTH QUARTER EBITDA CONSIDERATION IS A
NEGATIVE NUMBER, THE SELLER SHALL BE OBLIGATED TO REPAY TO BUYER THE ABSOLUTE
VALUE OF SUCH AMOUNT (THE “REPAYMENT OBLIGATION”) WITHIN TEN (10) DAYS OF THE
DATE ON WHICH THE FINAL EBITDA DETERMINATION (AS DEFINED BELOW) IS MADE WITH
RESPECT TO THE FOURTH QUARTER EBITDA CONSIDERATION.  SELLER MAY ELECT TO SATISFY
THE REPAYMENT OBLIGATION BY DELIVERY OF CASH TO SELLER OR DELIVERY OF EARN-OUT
SHARES, AS DEFINED BELOW, PURSUANT TO SECTION 2.5(C).  IN NO EVENT SHALL THE
AMOUNT OF THE REPAYMENT OBLIGATION EXCEED THE VALUE OF THE EARN-OUT SHARES
ISSUED TO THE SELLER IN THE FIRST QUARTER, SECOND QUARTER AND THIRD QUARTER AND
ONCE THE EARN-OUT SHARES FROM SUCH PERIODS HAVE BEEN EXTINGUISHED IN ORDER TO
SATISFY ALL OR PART OF THE REPAYMENT OBLIGATION, THE BUYER AND PARENT
ACKNOWLEDGE AND AGREE THAT THEY SHALL HAVE NO FURTHER RECOURSE TO THE REPAYMENT
OBLIGATION FROM THE SELLER AND THE PRINCIPAL OWNERS.

(E)           FOR THE PERIOD FROM OCTOBER 1, 2007 THROUGH SEPTEMBER 30, 2008
(THE “SECOND YEAR”), BUYER SHALL PAY TO SELLER $5,000,000;

(I)            MINUS THE DIFFERENCE BETWEEN: (A) $5,000,000; AND (B) EBITDA
EARNED BY THE CANADIAN BUSINESS DURING THE SECOND YEAR (“SECOND YEAR EBITDA”);
AND

(II)           MINUS: (A) IF SECOND YEAR EBITDA EARNED BY THE CANADIAN BUSINESS
IS LESS THAN $750,000, THE FULL AMOUNT OF THE SECOND YEAR EBITDA EARNED BY THE
CANADIAN BUSINESS; (B) IF SECOND YEAR EBITDA EARNED BY THE CANADIAN BUSINESS IS
GREATER THAN $750,000 AND LESS THAN $1,250,000, $1.00 FOR EACH DOLLAR THAT
SECOND YEAR EBITDA EARNED BY THE CANADIAN BUSINESS IS LESS THAN $1,250,000 (NOT
TO EXCEED $500,000); OR (C) IF SECOND YEAR EBITDA EARNED BY THE CANADIAN
BUSINESS IS EQUAL TO OR GREATER THAN $1,250,000 THEN BY ZERO DOLLARS.

(III)          THE CONSIDERATION TO BE PAID, IF ANY, PURSUANT TO THIS SECTION
2.3(E) SHALL BE REFERRED TO AS THE “SECOND YEAR EBITDA CONSIDERATION.”

(F)            FOR THE PERIOD FROM OCTOBER 1, 2008 THROUGH SEPTEMBER 30, 2009
(THE “THIRD YEAR”), BUYER SHALL PAY TO SELLER $10,000,000;

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(I)            MINUS THE DIFFERENCE BETWEEN: (A) $10,000,000; AND (B) EBITDA
EARNED BY THE CANADIAN BUSINESS DURING THE THIRD YEAR (“THIRD YEAR EBITDA”); AND

(II)           MINUS: (A) IF THIRD YEAR EBITDA EARNED BY THE CANADIAN BUSINESS
IS LESS THAN $1,125,000, THE FULL AMOUNT OF THE THIRD YEAR EBITDA EARNED BY THE
CANADIAN BUSINESS; (B) IF THIRD YEAR EBITDA EARNED BY THE CANADIAN BUSINESS IS
GREATER THAN $1,125,000 AND LESS THAN $1,650,000, $1.00 FOR EACH DOLLAR THAT
THIRD YEAR EBITDA EARNED BY THE CANADIAN BUSINESS IS LESS THAN $1,650,000 (NOT
TO EXCEED $525,000); OR (C) IF THIRD YEAR EBITDA EARNED BY THE CANADIAN BUSINESS
IS EQUAL TO OR GREATER THAN $1,650,000 THEN BY ZERO DOLLARS.

(III)          THE CONSIDERATION TO BE PAID, IF ANY, PURSUANT TO THIS
SECTION 2.3(F) SHALL BE REFERRED TO AS THE “THIRD YEAR EBITDA CONSIDERATION.”

(G)           FOR ILLUSTRATION PURPOSES ONLY, ATTACHED HERETO AS SCHEDULE 2.3 IS
AN EXAMPLE CALCULATION OF THE EBITDA EARN-OUT PAYMENTS BASED UPON A HYPOTHETICAL
SITUATION.  THE ATTACHED SCHEDULE 2.3 IS INTENDED TO FURTHER EVIDENCE THE INTENT
OF THE PARTIES WITH RESPECT TO THE METHODOLOGY USED TO CALCULATE THE EBITDA
EARN-OUT PAYMENTS.

2.4          DETERMINATION OF EBITDA.  WITHIN FORTY FIVE (45) DAYS AFTER THE END
OF ANY OF THE EBITDA EARN-OUT PAYMENT PERIODS SET FORTH IN SECTION 2.3 (A)
THROUGH (F) ABOVE (EACH AN “EBITDA EARN-OUT PERIOD” AND COLLECTIVELY THE “EBITDA
EARN-OUT PERIODS”), BUYER AND ITS AUDITORS SHALL CONDUCT A REVIEW OF BUYER’S
FINANCIAL STATEMENTS AS OF THE END OF THE THEN-RELEVANT EARN-OUT PERIOD AND
SHALL PREPARE AND DELIVER TO SELLER (OR SELLER’S APPOINTED REPRESENTATIVE, AS
THE CASE MAY BE) A COMPUTATION OF EBITDA EARNED BY THE CANADIAN BUSINESS FOR
SUCH EARN-OUT PERIOD (THE “EBITDA EARN-OUT NOTICE”).  EBITDA SHALL BE DETERMINED
IN ACCORDANCE WITH GAAP AS DETERMINED BY BUYER AND ITS AUDITORS IN THEIR SOLE
DISCRETION.  IF SELLER DISAGREES WITH THE COMPUTATION OF EBITDA EARNED BY THE
CANADIAN BUSINESS WITH RESPECT TO ANY EBITDA EARN-OUT PERIOD, SELLER MAY, WITHIN
TEN (10) DAYS AFTER RECEIPT OF THE EBITDA EARN-OUT NOTICE, DELIVER A NOTICE (AN
“EBITDA EARN-OUT OBJECTION NOTICE”) TO BUYER SETTING FORTH SELLER’S CALCULATION
OF EBITDA EARNED BY THE CANADIAN BUSINESS FOR SUCH EARN-OUT PERIOD.  IF SELLER
DOES NOT DELIVER AN EARN-OUT OBJECTION NOTICE WITHIN SUCH TEN (10) DAY PERIOD,
THEN EBITDA FOR THE EARN-OUT PERIOD SHALL BE DEEMED FINALLY DETERMINED TO BE AS
SET FORTH IN THE EBITDA EARN-OUT NOTICE.  BUYER AND SELLER (EACH A “PARTY” AND
COLLECTIVELY THE “PARTIES” FOR PURPOSES OF THIS SECTION 2.4 ONLY) AGREE TO USE
REASONABLE BEST EFFORTS TO RESOLVE ANY DISAGREEMENTS AS TO THE COMPUTATION OF
EBITDA FOR ANY PARTICULAR EARN-OUT PERIOD, BUT IF THEY DO NOT OBTAIN A FINAL
RESOLUTION WITHIN THIRTY (30) DAYS AFTER BUYER HAS RECEIVED THE EARN-OUT
OBJECTION NOTICE, THE PARTIES SHALL JOINTLY RETAIN AN INDEPENDENT ACCOUNTING
FIRM OF RECOGNIZED NATIONAL STANDING TO RESOLVE ANY REMAINING DISAGREEMENTS (THE
“FIRM”).  THE PARTIES SHALL DIRECT THE FIRM TO RENDER A DETERMINATION WITHIN
THIRTY (30) DAYS AFTER ITS RETENTION AND THE PARTIES AGREE TO COOPERATE WITH THE
FIRM DURING ITS ENGAGEMENT.  THE FIRM WILL CONSIDER ONLY THOSE ITEMS AND AMOUNTS
IN THE CALCULATION OF EBITDA EARNED BY THE CANADIAN BUSINESS SET FORTH IN THE
EBITDA EARN-OUT OBJECTION NOTICE WHICH THE PARTIES ARE UNABLE TO RESOLVE.  THE
PARTIES SHALL EACH MAKE WRITTEN SUBMISSIONS TO THE FIRM PROMPTLY (AND, IN ANY
EVENT, WITHIN THIRTY (30) DAYS AFTER THE FIRM’S ENGAGEMENT), WHICH SUBMISSIONS
SHALL CONTAIN SUCH PARTY’S COMPUTATION OF EBITDA EARNED BY THE CANADIAN BUSINESS
FOR THE EARN-OUT PERIOD AND INFORMATION, ARGUMENTS, AND SUPPORT FOR ITS
POSITION.  THE FIRM SHALL REVIEW SUCH SUBMISSIONS AND BASE ITS DETERMINATION
SOLELY ON THEM.  IN RESOLVING ANY DISPUTED ITEM, THE FIRM MAY NOT ASSIGN A VALUE
TO ANY ITEM GREATER THAN THE GREATEST VALUE FOR SUCH ITEM CLAIMED BY EITHER
PARTY OR

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LESS THAN THE SMALLEST VALUE FOR SUCH ITEM CLAIMED BY EITHER PARTY.  THE FIRM’S
DETERMINATION WILL BE BASED ON THE DEFINITION OF EBITDA INCLUDED HEREIN.  THE
DETERMINATION OF EBITDA EARNED BY THE CANADIAN BUSINESS FOR A PARTICULAR PERIOD
MADE BY THE FIRM SHALL BE BINDING AND CONCLUSIVE ON THE PARTIES HERETO FOR ALL
PURPOSES UNDER THIS AGREEMENT (THE “FINAL EBITDA DETERMINATION”).  ALL FEES OF
THE FIRM SHALL BE PAID BY THE PARTY THAT PROPOSED THE EBITDA EARNED BY THE
CANADIAN BUSINESS FURTHEST FROM THE FINAL EBITDA DETERMINATION.  IF THE FINAL
EBITDA DETERMINATION IS EXACTLY HALF WAY BETWEEN THE FIGURE FOR EBITDA EARNED BY
THE CANADIAN BUSINESS PROPOSED BY EACH OF BUYER AND SELLER, THEN BUYER AND
SELLER SHALL PAY EQUAL AMOUNTS OF THE FIRM’S FEES.

2.5          PAYMENT OF EBITDA EARN-OUT PAYMENTS.  THE PAYMENT BY BUYER OF ANY
OF THE EBITDA EARN-OUT PAYMENTS SET FORTH IN SECTION 2.3 MAY BE MADE IN CASH OR
COMMON STOCK, SO LONG AS THE CASH PORTION SHALL NOT BE LESS THAN FIFTY PERCENT
(50%) OF ANY SUCH PAYMENT.

(A)           TO THE EXTENT THAT BUYER IS OBLIGATED TO MAKE AN EBITDA EARN-OUT
PAYMENT IN CASH, AS DETERMINED IN ACCORDANCE WITH SECTION 2.5 ABOVE, BUYER SHALL
REMIT SUCH CASH PAYMENT TO SELLER (OR SELLER’S APPOINTED REPRESENTATIVE AS THE
CASE MAY BE) WITHIN FIFTEEN (15) DAYS OF THE DATE ON WHICH THE EBITDA EARN-OUT
NOTICE IS FIRST DELIVERED TO THE SELLER (OR SELLER’S APPOINTED REPRESENTATIVE AS
THE CASE MAY BE).

(B)           TO THE EXTENT BUYER DETERMINES TO PAY A PORTION OF ANY EBITDA
EARN-OUT PAYMENTS IN COMMON STOCK, THE NUMBER OF SHARES OF COMMON STOCK PAYABLE
TO SELLER SHALL BE EQUAL TO THE QUOTIENT OBTAINED BY DIVIDING (I) THE AMOUNT OF
THE APPLICABLE EBITDA EARN-OUT PAYMENT LESS THAT PORTION OF THE EBITDA EARN-OUT
PAYMENT TO BE PAID IN CASH, BY (II) THE APPLICABLE AVERAGE PER SHARE PRICE.  FOR
PURPOSES OF THIS SECTION 2.5 ONLY, THE “AVERAGE PER SHARE PRICE” MEANS THE
AVERAGE OF THE CLOSING PRICES PER SHARE OF THE COMMON STOCK AS REPORTED ON THE
OTC DURING THE TEN (10) TRADING DAYS PRECEDING THE FINAL DATE OF THE APPLICABLE
EBITDA EARN-OUT PERIOD, PROVIDED, HOWEVER, THAT THE APPLICABLE AVERAGE PER SHARE
PRICE SHALL BE SUBJECT TO THE FOLLOWING LIMITATIONS:

(I)            FOR EACH OF THE FIRST QUARTER EBITDA CONSIDERATION, SECOND
QUARTER EBITDA CONSIDERATION, THIRD QUARTER EBITDA CONSIDERATION AND FOURTH
QUARTER EBITDA CONSIDERATION, THE AVERAGE PER SHARE PRICE SHALL BE NOT LESS THAN
TWENTY CENTS ($0.20) PER SHARE;

(II)           FOR THE SECOND YEAR EBITDA CONSIDERATION, THE AVERAGE PER SHARE
PRICE SHALL BE NOT LESS THAN TWENTY FIVE CENTS ($0.25) PER SHARE; AND

(III)          FOR THE THIRD YEAR EBITDA CONSIDERATION, THE AVERAGE PER SHARE
PRICE SHALL BE NOT LESS THAN THIRTY CENTS ($0.30) PER SHARE.

(C)           UPON FINAL DETERMINATION OF THE NUMBER OF SHARES OF COMMON STOCK
PAYABLE PURSUANT TO SECTION 2.5(B) ABOVE AT THE CONCLUSION OF ANY EBITDA
EARN-OUT PERIOD, BUYER SHALL ISSUE CERTIFICATES REPRESENTING THE APPLICABLE
NUMBER OF SHARES OF COMMON STOCK (THE “EARN-OUT SHARES”) TO SELLER WITHIN TEN
(10) DAYS OF THE DATE ON WHICH THE EBITDA EARN-OUT NOTICE IS FIRST DELIVERED TO
THE SELLER (OR SELLER’S APPOINTED REPRESENTATIVE AS THE CASE MAY BE), PROVIDED
THAT SELLER DELIVERS TO BUYER AN EXECUTED INVESTOR REPRESENTATION LETTER IN A
FORM REASONABLY ACCEPTABLE TO BUYER.  IMMEDIATELY UPON RECEIPT OF THE EARN-OUT
SHARES WITH RESPECT TO THE FIRST QUARTER EBITDA CONSIDERATION, THE SECOND
QUARTER EBITDA CONSIDERATION AND THE THIRD QUARTER EBITDA

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CONSIDERATION, SELLER SHALL IMMEDIATELY DEPOSIT THE CERTIFICATES REPRESENTING
SUCH EARN-OUT SHARES, TOGETHER WITH A STOCK POWER OR OTHER INSTRUMENT OF
TRANSFER ENDORSED IN BLANK, WITH BUYER, TO BE HELD IN ESCROW BY BUYER.  IN THE
EVENT THERE IS A REPAYMENT OBLIGATION BY SELLER TO BUYER PURSUANT TO SECTION
2.3(D)(V), SELLER MAY ELECT TO SATISFY SUCH REPAYMENT OBLIGATION BY DELIVERY TO
BUYER OF SUCH NUMBER OF EARN-OUT SHARES HAVING A VALUE EQUAL TO THE AMOUNT OF
THE REPAYMENT OBLIGATION.  FOR PURPOSES OF THIS SECTION 2.5(C), THE VALUE PER
SHARE OF THE BUYER’S COMMON STOCK SHALL BE THE WEIGHTED AVERAGE VALUE PER SHARE
OF ALL OF THE EARN-OUT SHARES HELD IN ESCROW BY BUYER, USING THE AVERAGE PER
SHARE PRICE USED TO CALCULATE THE NUMBER OF EARN-OUT SHARES ISSUED TO SELLER. 
IN THE EVENT SELLER DOES NOT REPAY THE REPAYMENT OBLIGATION WITHIN TEN (10) DAYS
OF THE FINAL EBITDA DETERMINATION WITH RESPECT TO THE FOURTH QUARTER EBITDA
CONSIDERATION, SELLER SHALL BE DEEMED TO HAVE ELECTED TO PAY THE REPAYMENT
OBLIGATION BY THE TRANSFER OF EARN-OUT SHARES.  ANY EARN-OUT SHARES NOT
TRANSFERRED BACK TO BUYER PURSUANT TO THIS SECTION 2.5 SHALL BE PROMPTLY
DELIVERED TO SELLER.

(D)           IF A FINAL EBITDA DETERMINATION REVEALS THAT THE RESPECTIVE EBITDA
EARN-OUT PAYMENT WAS LESS THAN THE FINAL EBITDA DETERMINATION AMOUNT, THEN SUCH
RESPECTIVE EBITDA EARN-OUT PAYMENT SHALL BE INCREASED BY AN AMOUNT OBTAINED BY
SUBTRACTING THE EBITDA EARN-OUT PAYMENT FROM THE RESPECTIVE FINAL EBITDA
DETERMINATION AMOUNT (THE “DEFICIENCY”).  DEFICIENCIES SHALL BE PAYABLE BY BUYER
TO SELLER IN IMMEDIATELY AVAILABLE FUNDS, WITHIN TEN (10) DAYS OF THE DATE ON
WHICH THE FIRM HAS DELIVERED ITS DETERMINATION FOR SUCH MATTER.

(E)           IF A FINAL EBITDA DETERMINATION REVEALS THAT THE RESPECTIVE EBITDA
EARN-OUT PAYMENT WAS GREATER THAN THE FINAL EBITDA DETERMINATION AMOUNT, THEN
SUCH RESPECTIVE EBITDA EARN-OUT PAYMENT SHALL BE DECREASED BY AN AMOUNT OBTAINED
BY SUBTRACTING THE FINAL EBITDA DETERMINATION AMOUNT FROM THE RESPECTIVE EBITDA
EARN-OUT PAYMENT (THE “OVER PAYMENT”).  OVER PAYMENTS SHALL BE PAYABLE BY SELLER
TO BUYER IN IMMEDIATELY AVAILABLE FUNDS, WITHIN TEN (10) DAYS OF THE DATE ON
WHICH THE FIRM HAS DELIVERED ITS DETERMINATION FOR SUCH MATTER OR BUYER MAY SET
OFF THE AGGREGATE OF SUCH AMOUNT AGAINST A FUTURE EBITDA EARN-OUT PAYMENT.

2.6          ISSUANCE OF RESTRICTED SHARES.  TO THE EXTENT ANY SHARES OF COMMON
STOCK ARE ISSUED TO PAY SOME OF THE CLOSING CONSIDERATION OR A PORTION OF ANY
EBITDA EARN-OUT PAYMENT AS SET FORTH IN SECTION 2.5 ABOVE, SUCH SHARES SHALL BE
ISSUED PURSUANT TO A PRIVATE PLACEMENT TRANSACTION AND SHALL NOT HAVE BEEN, AND,
EXCEPT AS SET FORTH IN SECTION 6.6 BELOW, ARE NOT BEING, REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR ANY APPLICABLE
STATE SECURITIES LAWS, AND ARE, THEREFORE, SUBJECT TO CERTAIN RESTRICTIONS ON
TRANSFERABILITY.  ALL SHARES OF COMMON STOCK TO BE ISSUED PURSUANT TO THIS
AGREEMENT WILL BE DULY AUTHORIZED, VALIDLY ISSUED, FULLY PAID AND NONASSESSABLE.

2.7          ADJUSTMENT TO CASH CONSIDERATION.  THE CASH CONSIDERATION SHALL BE
ADJUSTED TO REFLECT THE AMOUNT OF NET WORKING CAPITAL ON SELLER’S BALANCE SHEET
(AS HEREINAFTER DEFINED) ON THE CLOSING DATE (THE “NET WORKING CAPITAL”).  FOR
PURPOSES OF THIS AGREEMENT, “NET WORKING CAPITAL” MEANS CURRENT ASSETS LESS
CURRENT LIABILITIES AS SUCH TERMS SHALL BE DETERMINED IN ACCORDANCE WITH UNITED
STATES GENERALLY ACCEPTED ACCOUNTING PRINCIPLES (“GAAP”), PROVIDED, HOWEVER,
THAT, WHETHER OR NOT REQUIRED BY GAAP, CURRENT LIABILITIES SHALL INCLUDE,
WITHOUT LIMITATION, EXPENSES OF SELLER RELATING TO THE TRANSACTION CONTEMPLATED
BY THIS AGREEMENT AND EXPENSES RELATING TO SEVERANCE PAYMENTS.

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(A)           SELLER AGREES TO DELIVER AN ESTIMATE OF THE NET WORKING CAPITAL ON
THE CLOSING DATE (THE “ESTIMATED NET WORKING CAPITAL”).  IF THE ESTIMATED NET
WORKING CAPITAL IS LESS THAN TWO HUNDRED FIFTY THOUSAND DOLLARS ($250,000) (THE
“TARGET NET WORKING CAPITAL”), BUYER WILL DECREASE THE CASH CONSIDERATION BY THE
AMOUNT WHICH IS OBTAINED BY SUBTRACTING THE ESTIMATED NET WORKING CAPITAL FROM
THE TARGET NET WORKING CAPITAL.  IF THE ESTIMATED NET WORKING CAPITAL IS GREATER
THAN THE TARGET NET WORKING CAPITAL, BUYER WILL INCREASE THE CASH CONSIDERATION
BY THE AMOUNT WHICH IS OBTAINED FROM SUBTRACTING THE TARGET NET WORKING CAPITAL
FROM THE ESTIMATED NET WORKING CAPITAL.

(B)           WITHIN THIRTY (30) DAYS FOLLOWING THE CLOSING DATE, BUYER WILL
PROVIDE SELLER WITH ITS FINAL CALCULATION OF THE NET WORKING CAPITAL (“BUYER’S
NET WORKING CAPITAL CALCULATION”).  SELLER SHALL HAVE THIRTY (30) DAYS TO REVIEW
BUYER’S NET WORKING CAPITAL CALCULATION, WHICH SHALL BE FINAL AND BINDING UPON
SELLER UNLESS SELLER DISPUTES THE SAME IN WRITING WITHIN SUCH THIRTY (30) DAY
PERIOD.  SELLER MAY DISPUTE BUYER’S NET WORKING CAPITAL CALCULATION BY
SPECIFYING IN REASONABLE DETAIL THE NATURE OF THE DISAGREEMENT, THE BASIS FOR
SUCH DISAGREEMENT AND SELLER’S CALCULATION OF THE NET WORKING CAPITAL.  IN THE
EVENT SELLER SO NOTIFIES BUYER IN WRITING WITHIN SUCH THIRTY (30) DAY PERIOD OF
ANY SUCH DISPUTE, BUYER AND SELLER SHALL ATTEMPT TO RESOLVE ALL SUCH DISPUTES IN
WRITING, AND THE NET WORKING CAPITAL SHALL BE ADJUSTED TO REFLECT ANY SUCH
RESOLUTION.  IF BUYER AND SELLER ARE UNABLE TO RESOLVE ALL SUCH DISPUTES WITHIN
FIFTEEN (15) DAYS AFTER SUCH NOTIFICATION, THEN THE MATTERS STILL IN DISPUTE
SHALL BE SUBMITTED TO AN ACCOUNTING FIRM MUTUALLY ACCEPTABLE TO BUYER AND
SELLER.  IF BUYER AND SELLER ARE UNABLE TO AGREE ON THE CHOICE OF AN ACCOUNTING
FIRM, THEN THE ACCOUNTING FIRM WILL BE AN ACCOUNTING FIRM INDEPENDENT WITH
RESPECT TO BOTH BUYER AND SELLER SELECTED BY SELLER AND BUYER FROM A LIST OF
SUCH FIRMS COMPILED BY SELLER AND THE AUDITORS OF BUYER (THE “ARBITRATING
ACCOUNTANTS”).  BUYER AND SELLER SHALL BE AFFORDED THE OPPORTUNITY TO PRESENT TO
THE ARBITRATING ACCOUNTANTS (WITH COPIES TO BE PROVIDED TO THE OTHER PARTY) ANY
MATERIAL RELATED TO THE UNRESOLVED DISPUTES AND TO DISCUSS THE ISSUES WITH THE
ARBITRATING ACCOUNTANTS.  THE ARBITRATING ACCOUNTANTS SHALL DETERMINE THE AMOUNT
OF EACH OF THE ITEMS BEING DISPUTED AND NOTIFY THE PARTIES OF THE ARBITRATING
ACCOUNTANTS’ DETERMINATIONS IN WRITING WITHIN THIRTY (30) DAYS AFTER THE
SUBMISSION OF THE UNRESOLVED DISPUTES TO THE ARBITRATING ACCOUNTANTS.  THE
ARBITRATING ACCOUNTANTS SHALL RESOLVE ALL REMAINING POINTS OF DISAGREEMENT WITH
RESPECT TO THE CALCULATION OF THE NET WORKING CAPITAL, WHICH RESOLUTION SHALL BE
FINAL AND BINDING UPON BUYER AND SELLER WITH NO RIGHT OF APPEAL.  IN MAKING SUCH
FINAL RESOLUTION, THE ARBITRATING ACCOUNTANTS MAY ONLY CONSIDER THOSE MATTERS
IDENTIFIED BY BUYER AND SELLER TO BE IN DISPUTE AND MAY ONLY DETERMINE THE NET
WORKING CAPITAL TO BE AN AMOUNT EQUAL TO THE AMOUNT PROPOSED BY BUYER, THE
AMOUNT PROPOSED BY SELLER OR SOME AMOUNT WITHIN THE RANGE OF THE AMOUNTS
PROPOSED BY BUYER AND SELLER.  IN RESOLVING ANY DISPUTED ITEM, THE ARBITRATING
ACCOUNTANTS MAY NOT ASSIGN A VALUE TO ANY ITEM GREATER THAN THE GREATEST VALUE
FOR SUCH ITEM CLAIMED BY EITHER PARTY OR LESS THAN THE SMALLEST VALUE FOR SUCH
ITEM CLAIMED BY EITHER PARTY.  THE FINAL DETERMINATION OF NET WORKING CAPITAL AS
CALCULATED PURSUANT TO THIS SECTION 2.7(B) SHALL BE REFERRED TO HEREIN AS THE
“FINAL NET WORKING CAPITAL”.  ALL FEES OF THE ARBITRATING ACCOUNTANTS SHALL BE
PAID BY THE PARTY THAT PROPOSED THE NET WORKING CAPITAL FURTHEST FROM THE FINAL
NET WORKING CAPITAL DETERMINED BY THE ARBITRATING ACCOUNTANTS.  IF THE FINAL NET
WORKING CAPITAL DETERMINED BY THE ARBITRATING ACCOUNTANTS IS EXACTLY HALF WAY
BETWEEN THE FINAL NET WORKING CAPITAL PROPOSED BY EACH OF BUYER AND SELLER, THEN
BUYER AND SELLER SHALL PAY EQUAL AMOUNTS OF THE ARBITRATING ACCOUNTANTS’ FEES.

(C)           IF THE FINAL NET WORKING CAPITAL AS DETERMINED IN ACCORDANCE WITH
SECTION 2.7(B) ABOVE IS DIFFERENT FROM THE ESTIMATED NET WORKING CAPITAL AS
DETERMINED IN SECTION 2.7(A) ABOVE

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THEN SUCH DISCREPANCY SHALL BE RESOLVED AS SET FORTH HEREIN.  TO THE EXTENT THE
FINAL NET WORKING CAPITAL IS LESS THAN THE ESTIMATED NET WORKING CAPITAL, SELLER
AGREES TO PAY BUYER, IN IMMEDIATELY AVAILABLE FUNDS, WITHIN TEN (10) DAYS OF THE
DATE ON WHICH THE FINAL NET WORKING CAPITAL IS DETERMINED, THE AMOUNT OBTAINED
BY SUBTRACTING THE FINAL NET WORKING CAPITAL FROM THE ESTIMATED NET WORKING
CAPITAL (THE “WORKING CAPITAL ADJUSTMENT”).  IF SELLER FAILS TO PAY THE WORKING
CAPITAL ADJUSTMENT WITHIN THE REQUIRED TIME PERIOD, BUYER SHALL, ALONG WITH
OTHER REMEDIES THAT MAY BE AVAILABLE TO BUYER, BE ENTITLED TO DEDUCT SUCH AMOUNT
IN THE AGGREGATE FROM AN EBITDA EARN-OUT PAYMENT.  TO THE EXTENT THE FINAL NET
WORKING CAPITAL IS GREATER THAN THE ESTIMATED NET WORKING CAPITAL, BUYER AGREES
TO PAY SELLER, IN IMMEDIATELY AVAILABLE FUNDS, WITHIN TEN (10) DAYS OF THE DATE
ON WHICH THE FINAL NET WORKING CAPITAL IS DETERMINED, THE AMOUNT OBTAINED BY
SUBTRACTING THE ESTIMATED NET WORKING CAPITAL FROM THE FINAL NET WORKING
CAPITAL.

2.8          ALLOCATION OF PURCHASE PRICE.

(A)           THE PARTIES AGREE TO ALLOCATE THE PURCHASE PRICE AMONG THE
PURCHASED ASSETS FOR ALL PURPOSES (INCLUDING FINANCIAL ACCOUNTING AND TAX
PURPOSES) IN ACCORDANCE WITH THE ALLOCATION SCHEDULE ATTACHED HERETO AS
SCHEDULE 2.8.  THE SELLER AND THE BUYER ACKNOWLEDGE THAT SUCH ALLOCATION
REPRESENTS THE FAIR MARKET VALUE OF THE PURCHASED ASSETS ARRIVED AT BY ARMS’
LENGTH NEGOTIATIONS AND SHALL BE BINDING UPON THE PARTIES FOR ALL APPLICABLE
TAXES. THE SELLER AND THE BUYER EACH COVENANT TO REPORT PROCEEDS OF ACQUISITION
OR COST OF ACQUISITION, AS THE CASE MAY BE, IN A MANNER CONSISTENT WITH SCHEDULE
2.8 ON ALL TAX RETURNS FILED BY EACH OF THEM SUBSEQUENT TO CLOSING AND NOT TO
VOLUNTARILY TAKE ANY INCONSISTENT POSITION THEREWITH IN ANY ADMINISTRATIVE OR
JUDICIAL PROCEEDING RELATING TO SUCH RETURNS, WITHOUT THE PRIOR WRITTEN CONSENT
OF THE OTHER PARTY, WHICH CONSENT SHALL NOT BE ARBITRARILY OR UNREASONABLY
WITHHELD.

(B)           THE BUYER AND THE SELLER WILL, AT THE CLOSING DATE, JOINTLY
EXECUTE ELECTIONS, IN PRESCRIBED FORM AND CONTAINING THE PRESCRIBED INFORMATION
TO HAVE THE PROVISIONS OF SUBSECTION 167(1) OF THE EXCISE TAX ACT APPLY TO THE
PURCHASE AND SALE OF THE PURCHASED ASSETS HEREUNDER IN ORDER TO MINIMIZE THE TAX
PAYABLE IN RESPECT OF SUCH PURCHASE AND SALE UNDER PART IX OF THE EXCISE TAX
ACT.  THE BUYER WILL FILE SUCH ELECTIONS WITH CRA WITHIN THE TIMES PRESCRIBED BY
THE APPLICABLE LEGISLATION.

2.9          TRANSFER TAXES, ETC.

(A)           SUBJECT TO SUBSECTION 2.9(B), THE BUYER SHALL PAY TO THE SELLER
OR, WHERE PERMITTED BY APPLICABLE LAW, DIRECTLY TO THE APPROPRIATE GOVERNMENTAL
AUTHORITY, ALL COMMODITY AND TRANSFER TAXES, REGISTRATION CHARGES AND TRANSFER
FEES, INCLUDING GST AND ORST PAYABLE BY IT IN RESPECT OF THE PURCHASE AND SALE
OF THE PURCHASED ASSETS UNDER THIS AGREEMENT.

(B)           WITHOUT LIMITING THE APPLICABILITY OF SECTION 1.1 HEREOF, EACH OF
THE SELLER AND THE BUYER SHALL USE REASONABLE COMMERCIAL EFFORTS TO MINIMIZE THE
AMOUNTS REFERRED TO IN SECTION 2.9(A), INCLUDING EXECUTING AND DELIVERING
EXEMPTION CERTIFICATES AND SIMILAR DOCUMENTS TO THE EXTENT APPLICABLE.

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ARTICLE III

REPRESENTATIONS AND WARRANTIES OF SELLER AND THE PRINCIPAL OWNERS

Subject to the disclosures and exceptions set forth in the disclosure schedules
attached hereto (the “Seller’s Disclosure Schedules”), Seller and the Principal
Owners hereby jointly and severally make the representations and warranties set
forth hereinafter in this Article III to Buyer:

3.1          AUTHORITY AND BINDING EFFECT.  SELLER HAS THE FULL CORPORATE POWER
AND AUTHORITY TO EXECUTE AND DELIVER THIS AGREEMENT AND THE BILL OF SALE (AS
HEREINAFTER DEFINED).  THIS AGREEMENT, AND THE BILL OF SALE, AND THE
CONSUMMATION BY SELLER OF ITS OBLIGATIONS CONTAINED HEREIN AND THEREIN, HAVE
BEEN DULY AUTHORIZED BY ALL NECESSARY CORPORATE ACTIONS OF SELLER, INCLUDING
SHAREHOLDER APPROVAL WHICH APPROVAL IS A CONDITION TO CLOSING, AND SUCH
AGREEMENTS HAVE BEEN DULY EXECUTED AND DELIVERED BY SELLER.  THIS AGREEMENT IS A
VALID AND BINDING AGREEMENT OF SELLER, ENFORCEABLE AGAINST SELLER IN ACCORDANCE
WITH ITS TERMS, SUBJECT TO SHAREHOLDER APPROVAL, AND UPON EXECUTION AND
DELIVERY, THE BILL OF SALE WILL BE A VALID AND BINDING AGREEMENT OF SELLER AND
SHALL BE ENFORCEABLE AGAINST IT IN ACCORDANCE WITH ITS TERMS, EXCEPT AS
ENFORCEABILITY OF THE OBLIGATIONS OF SELLER UNDER THIS AGREEMENT AND THE BILL OF
SALE MAY BE LIMITED BY (I) BANKRUPTCY, INSOLVENCY, MORATORIUM OR OTHER SIMILAR
LAWS AFFECTING CREDITORS’ RIGHTS GENERALLY, AND (II) GENERAL PRINCIPLES OF
EQUITY RELATING TO THE AVAILABILITY OF EQUITABLE REMEDIES (WHETHER SUCH
AGREEMENTS ARE SOUGHT TO BE ENFORCED IN A PROCEEDING AT LAW OR A PROCEEDING IN
EQUITY).  EXCEPT AS SET FORTH ON SCHEDULE 3.1, AND EXCEPT FOR APPROVAL OF THE
SHAREHOLDERS OF SELLER AND CONSENTS NECESSARY FOR ASSIGNMENT OF ASSIGNED
CONTRACTS, IT IS NOT NECESSARY FOR SELLER TO TAKE ANY ACTION OR TO OBTAIN ANY
APPROVAL, CONSENT OR RELEASE BY OR FROM ANY THIRD PERSON, GOVERNMENT OR OTHER,
TO ENABLE SELLER TO ENTER INTO OR PERFORM ITS OBLIGATIONS UNDER THIS AGREEMENT
AND THE BILL OF SALE.

3.2          ORGANIZATION AND STANDING.  SELLER IS A CORPORATION DULY FORMED,
VALIDLY EXISTING AND IN GOOD STANDING UNDER THE LAWS OF ONTARIO AND SELLER IS
QUALIFIED TO DO BUSINESS IN EACH JURISDICTION WHERE SUCH QUALIFICATION IS
NECESSARY AND WHERE THE FAILURE TO BE SO QUALIFIED WOULD HAVE A MATERIAL ADVERSE
EFFECT ON SELLER.  SELLER HAS THE REQUISITE CORPORATE POWER AND AUTHORITY TO
CONDUCT ITS BUSINESS AS NOW CONDUCTED AND TO OWN OR LEASE THE PURCHASED ASSETS,
AND TO USE SUCH PURCHASED ASSETS IN THE CONDUCT OF ITS BUSINESS.  TRUE AND
COMPLETE COPIES OF THE CONSTATING DOCUMENTS OF SELLER HAVE BEEN DELIVERED TO
BUYER.  SELLER IS NOT IN VIOLATION OF ITS CONSTATING DOCUMENTS.  SELLER HAS NO
SUBSIDIARIES.

3.3          FINANCIAL STATEMENTS.  SELLER HAS DELIVERED TO BUYER UNAUDITED
NOTICE TO READER FINANCIAL STATEMENTS OF SELLER CONSISTING OF BALANCE SHEETS AS
OF THE END OF, AND THE RELATED STATEMENTS OF INCOME AND CASH FLOWS FOR, EACH OF
THE YEARS IN THE THREE-YEAR PERIOD ENDED DECEMBER 31, 2005, AND AN UNAUDITED
BALANCE SHEET AND RELATED STATEMENTS OF INCOME AND CASH FLOWS FOR THE PERIOD
BEGINNING JANUARY 1, 2006 AND ENDING SEPTEMBER 30, 2006 (COLLECTIVELY, THE
“FINANCIAL STATEMENTS”).  TRUE AND CORRECT COPIES OF THE FINANCIAL STATEMENTS
ARE ATTACHED HERETO AS SCHEDULE 3.3. THE FINANCIAL STATEMENTS WERE PREPARED IN
ACCORDANCE WITH GAAP, CONSISTENTLY APPLIED, AND FAIRLY PRESENT, ON AN ACCRUAL
BASIS, THE FINANCIAL CONDITION OF SELLER AND THE RESULTS OF ITS OPERATIONS AS AT
THE RELEVANT DATES THEREOF AND FOR THE RESPECTIVE PERIODS COVERED THEREBY. 
SELLER HAS NO DEBTS, OBLIGATIONS OR LIABILITIES, FIXED OR CONTINGENT, OF A
NATURE THAT WOULD BE REQUIRED, IN ACCORDANCE WITH GAAP, TO BE SHOWN ON A BALANCE
SHEET AND THAT ARE NOT SHOWN ON THE BALANCE SHEET AS OF THE NINE (9) MONTH
PERIOD

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ENDED SEPTEMBER 30, 2006 (THE “BALANCE SHEET”), OTHER THAN LIABILITIES INCURRED
AFTER SEPTEMBER 30, 2006 IN THE ORDINARY COURSE OF SELLER’S BUSINESS AND
CONSISTENT WITH PAST PRACTICES.

3.4          ABSENCE OF CERTAIN CHANGES.  EXCEPT AS SET FORTH ON SCHEDULE 3.4,
SINCE SEPTEMBER 30, 2006, THERE HAS NOT BEEN:

(A)           ANY SALE, TRANSFER, OR OTHER DISPOSITION OF, OR THE INCURRENCE OR
IMPOSITION OF, ANY ENCUMBRANCE OF ANY KIND ON OR AFFECTING, ANY OF THE PURCHASED
ASSETS;

(B)           ANY DAMAGE, DESTRUCTION OR LOSS, WHETHER OR NOT COVERED BY
INSURANCE, OF ANY OF THE PURCHASED ASSETS;

(C)           THE ENTRY OR VIOLATION OF ANY JUDGMENT, ORDER, WRIT OR DECREE THAT
HAS HAD OR COULD REASONABLY BE EXPECTED TO HAVE A MATERIAL ADVERSE EFFECT ON
SELLER;

(D)           ANY MATERIAL DEFAULT OR BREACH OR ANY AMENDMENT, TERMINATION OR
REVOCATION OR, TO THE KNOWLEDGE OF SELLER, ANY WRITTEN THREATENED TERMINATION OR
REVOCATION OF, ANY OF THE ASSIGNED CONTRACTS;

(E)           ANY ACTUAL OR THREATENED AMENDMENT, TERMINATION OR REVOCATION OF
ANY LICENSE, PERMIT OR FRANCHISE REQUIRED FOR THE CONTINUED OPERATION OF THE
BUSINESS; OR

(F)            THE OCCURRENCE OF ANY OTHER EVENT OR CIRCUMSTANCE WHICH HAS OR
COULD REASONABLY BE EXPECTED TO HAVE A MATERIAL ADVERSE EFFECT ON SELLER.

3.5          TITLE TO AND CONDITION OF PURCHASED ASSETS.

(A)           FIXED ASSETS.  THE FIXED ASSETS ARE IN GOOD WORKING ORDER AND
CONDITION, ORDINARY WEAR AND TEAR EXCEPTED, HAVE BEEN PROPERLY MAINTAINED, ARE
SUITABLE FOR THE USES FOR WHICH THEY ARE BEING UTILIZED IN THE BUSINESS AND
COMPLY WITH ALL REQUIREMENTS UNDER APPLICABLE LAWS, REGULATIONS AND LICENSES
WHICH GOVERN THE USE AND OPERATION THEREOF.

(B)           TITLE TO AND ADEQUACY OF PURCHASED ASSETS.  EXCEPT AS DISCLOSED ON
SCHEDULE 3.5 HERETO, SELLER HAS, AND ON THE CLOSING DATE WILL CONVEY AND
TRANSFER TO BUYER, GOOD, COMPLETE AND MARKETABLE TITLE TO ALL OF THE PURCHASED
ASSETS, FREE AND CLEAR OF ALL ENCUMBRANCES OTHER THAN THE PERMITTED ENCUMBRANCES
OF ANY NATURE WHATSOEVER OTHER THAN RESTRICTIONS ON TRANSFER OF ASSIGNED
CONTRACTS.  EXCEPT AS SET FORTH ON SCHEDULE 3.5, ALL OF THE PURCHASED ASSETS ARE
IN THE EXCLUSIVE POSSESSION AND CONTROL OF SELLER AND SELLER HAS THE
UNENCUMBERED RIGHT TO USE, AND TO SELL TO BUYER IN ACCORDANCE WITH THE TERMS AND
PROVISIONS OF THIS AGREEMENT, ALL OF THE PURCHASED ASSETS WITHOUT INTERFERENCE
FROM AND FREE OF THE RIGHTS AND CLAIMS OF OTHERS.  THE PURCHASED ASSETS
CONSTITUTE ALL OF THE ASSETS, PROPERTIES, RIGHTS, PRIVILEGES AND INTEREST WHICH
SELLER EITHER OWNS OR CONTROLS, OR USES OR HOLDS FOR USE EXCLUSIVELY IN
CONNECTION WITH THE BUSINESS AND WHICH ARE NECESSARY FOR BUYER TO OWN AND
OPERATE THE BUSINESS AS CURRENTLY CONDUCTED AND AS PROPOSED TO BE CONDUCTED.

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3.6          INTELLECTUAL PROPERTY.

(A)           SET FORTH ON SCHEDULE 1.1(H) IS A COMPLETE LIST OF ALL
INTELLECTUAL PROPERTY RIGHTS, OWNED, LICENSED OR USED (EXCEPT AS OTHERWISE SET
OUT THEREIN) BY THE SELLER IN CONNECTION WITH THE BUSINESS THAT WILL BE
TRANSFERRED TO BUYER (THE “BUSINESS INTELLECTUAL PROPERTY RIGHTS”).  EXCEPT AS
SET OUT IN SCHEDULE 1.1(H), ALL OF THE BUSINESS INTELLECTUAL PROPERTY RIGHTS ARE
EITHER OWNED OR USED UNDER LICENSE BY SELLER, AS INDICATED ON SCHEDULE 1.1(H). 
USE BY SELLER OF THE BUSINESS INTELLECTUAL PROPERTY RIGHTS OWNED BY SELLER, AND,
TO THE KNOWLEDGE OF SELLER AND THE PRINCIPAL OWNER, USE BY SELLER OF THE
BUSINESS INTELLECTUAL PROPERTY RIGHTS LICENSED BY SELLER, DO NOT INFRINGE UPON
OR MISAPPROPRIATE THE INTELLECTUAL PROPERTY RIGHTS OF ANY THIRD PARTY AND NO
THIRD PARTY HAS PROVIDED SELLER WITH NOTICE OF ANY SUCH POSSIBLE VIOLATION. 
SELLER IS NOT AWARE OF ANY VALID BASIS FOR ANY CLAIM OF THE TYPE SPECIFIED IN
THIS SECTION 3.6(A).  TO THE KNOWLEDGE OF SELLER AND THE PRINCIPAL OWNER, NO
THIRD PARTY IS VIOLATING, INFRINGING, OR MISAPPROPRIATING ANY BUSINESS
INTELLECTUAL PROPERTY RIGHT.

(B)           SELLER HAS NOT GRANTED ANY LICENSES TO THIRD PARTIES WITH RESPECT
TO THE BUSINESS INTELLECTUAL PROPERTY RIGHTS. THE EXECUTION, DELIVERY AND
PERFORMANCE OF THIS AGREEMENT AND THE TRANSACTIONS CONTEMPLATED HEREBY WILL NOT
IN ANY WAY IMPAIR THE RIGHT OF BUYER TO USE ANY BUSINESS INTELLECTUAL PROPERTY
RIGHTS OR PORTION THEREOF.

(C)           EACH CURRENT AND FORMER EMPLOYEE, INDEPENDENT CONTRACTOR AND
CONSULTANT OF THE SELLER WHO HAS PARTICIPATED IN ANY MATERIAL RESPECT IN THE
DEVELOPMENT OF ANY BUSINESS INTELLECTUAL PROPERTY RIGHTS HAS PROPERLY ASSIGNED
SUCH INDIVIDUAL’S RIGHTS IN SUCH BUSINESS INTELLECTUAL PROPERTY RIGHTS TO
SELLER.  NO SELLER STOCKHOLDER, EMPLOYEE OR CONTRACTOR, NOR ANY OF THEIR
RESPECTIVE AFFILIATES, HAS ANY RIGHT, TITLE OR INTEREST IN OR TO ANY BUSINESS
INTELLECTUAL PROPERTY RIGHT.

(D)           TO THE KNOWLEDGE OF SELLER AND THE PRINCIPAL OWNER, NO EMPLOYEE OF
SELLER IS IN VIOLATION OF ANY TERM OF ANY EMPLOYMENT CONTRACT, INVENTION
DISCLOSURE AGREEMENT OR ANY OTHER CONTRACT OR AGREEMENT RELATING TO SELLER’S
BUSINESS.

(E)           EXCEPT AS SET FORTH IN SCHEDULE 1.1(H), NONE OF THE SELLER’S
PROPRIETARY SOFTWARE OR, TO THE KNOWLEDGE OF SELLER OR THE PRINCIPAL OWNER, ANY
SOFTWARE LICENSED TO THE SELLER TO WHICH THE SELLER HAS MADE MODIFICATIONS
CONTAINS, IS BASED ON OR DERIVED FROM, WAS DEVELOPED USING OR WITH REFERENCE TO
OR IS DISTRIBUTED OR LINKED (STATICALLY OR DYNAMICALLY) WITH ANY OPEN SOURCE
SOFTWARE LICENSED OR DISTRIBUTED PURSUANT TO ANY PUBLIC LICENSE.

(F)            THE BUSINESS INTELLECTUAL PROPERTY RIGHTS CONSTITUTE ALL OF THE
INTELLECTUAL PROPERTY RIGHTS NECESSARY FOR THE CONDUCT OF THE BUSINESS AS
PRESENTLY CONDUCTED BY SELLER.

3.7          THE ASSIGNED CONTRACTS AND OTHER AGREEMENTS.  ACCURATE AND COMPLETE
COPIES OF ALL OF THE ASSIGNED CONTRACTS HAVE BEEN FURNISHED BY SELLER TO BUYER. 
EACH OF THE ASSIGNED CONTRACTS IS A VALID AND BINDING OBLIGATION OF SELLER AND,
TO SELLER’S KNOWLEDGE, THE OTHER PARTIES THERETO, ENFORCEABLE IN ACCORDANCE WITH
ITS TERMS, EXCEPT AS MAY BE AFFECTED BY BANKRUPTCY, INSOLVENCY, MORATORIUM OR
SIMILAR LAWS AFFECTING CREDITORS’ RIGHTS GENERALLY AND GENERAL PRINCIPLES OF
EQUITY RELATING TO THE AVAILABILITY OF EQUITABLE REMEDIES.  THERE HAVE NOT BEEN
ANY DEFAULTS BY SELLER OR, TO THE KNOWLEDGE OF SELLER, DEFAULTS OR ANY CLAIMS OF
DEFAULT OR CLAIMS OF NONENFORCEABILITY BY THE OTHER PARTY OR PARTIES UNDER OR
WITH RESPECT TO ANY OF THE ASSIGNED CONTRACTS WHICH, INDIVIDUALLY OR IN

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THE AGGREGATE, WOULD HAVE A MATERIAL ADVERSE EFFECT ON SELLER, AND TO THE
KNOWLEDGE OF SELLER THERE ARE NO FACTS OR CONDITIONS THAT HAVE OCCURRED OR THAT
ARE ANTICIPATED TO OCCUR WHICH, WITH THE PASSAGE OF TIME OR THE GIVING OF
NOTICE, OR BOTH, WOULD CONSTITUTE A DEFAULT BY SELLER, OR TO THE KNOWLEDGE OF
SELLER, BY THE OTHER PARTY OR PARTIES, UNDER ANY OF THE ASSIGNED CONTRACTS OR
WOULD CAUSE A CREATION OR IMPOSITION OF ANY ENCUMBRANCE UPON ANY OF THE
PURCHASED ASSETS OR OTHERWISE WOULD HAVE A MATERIAL ADVERSE EFFECT ON SELLER. 
NONE OF THE ASSIGNED CONTRACTS CONTAINS ANY PROVISIONS WHICH, AFTER THE DATE
HEREOF, WOULD HINDER OR PREVENT BUYER FROM CONTINUING TO USE ANY OF THE ASSETS
OR PROPERTY, TANGIBLE OR INTANGIBLE, THAT ARE THE SUBJECT OF THE ASSIGNED
CONTRACT IN THE MANNER IN WHICH THEY ARE CURRENTLY USED.

3.8          CONFLICTS.  SUBJECT TO OBTAINING ALL NECESSARY CONSENTS TO
ASSIGNMENTS OF ASSIGNED CONTRACTS, NEITHER THE EXECUTION AND DELIVERY OF, NOR
THE CONSUMMATION OF, THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT OR THE BILL
OF SALE WILL OR COULD RESULT IN:  (A) A DEFAULT OR AN EVENT THAT, WITH NOTICE OR
LAPSE OF TIME, OR BOTH, WOULD BE A DEFAULT, BREACH OR VIOLATION OF THE
CONSTATING DOCUMENTS OF SELLER, OR OF ANY ASSIGNED CONTRACT; (B) THE CREATION OR
IMPOSITION OF ANY ENCUMBRANCE OTHER THAN THE PERMITTED ENCUMBRANCES ON ANY OF
THE PURCHASED ASSETS; (C) THE VIOLATION OR BREACH OF ANY WRIT, INJUNCTION OR
DECREE THAT WOULD BECOME OR IS NOW APPLICABLE TO OR BINDING ON ANY OF THE
PURCHASED ASSETS; (D) A LOSS OR ADVERSE MODIFICATION OF ANY LICENSE, FRANCHISE,
PERMIT OR OTHER AUTHORIZATION OR RIGHT (CONTRACTUAL OR OTHER) TO OPERATE
SELLER’S BUSINESS OR TO OWN ANY OF THE PURCHASED ASSETS, GRANTED TO OR OTHERWISE
HELD BY SELLER OR USED IN ITS BUSINESS, WHICH WOULD HAVE A MATERIAL ADVERSE
EFFECT ON SELLER; (E) THE RIGHT TO CEASE OR TERMINATE ANY OTHER BUSINESS
RELATIONSHIP OR ARRANGEMENT BETWEEN SELLER AND ANY THIRD PARTY THAT WOULD HAVE A
MATERIAL ADVERSE EFFECT ON SELLER; (F) THE RIGHT TO TERMINATE ANY ASSIGNED
CONTRACT, OR THE ACCELERATION OF THE MATURITY OF ANY INDEBTEDNESS OR OTHER
OBLIGATION OF SELLER WHICH WOULD HAVE A MATERIAL ADVERSE EFFECT ON SELLER, OR
(G) ANY OTHER CONSEQUENCE THAT WOULD HAVE A MATERIAL ADVERSE EFFECT ON SELLER.

3.9          CUSTOMERS.  SCHEDULE 3.9 ATTACHED HERETO CONTAINS CORRECT AND
CURRENT LISTS OF SELLER’S TEN (10) LARGEST CUSTOMERS, IN TERMS OF THE REVENUES
GENERATED FROM THE CONDUCT OF SELLER’S BUSINESS, IN THE TWENTY (20) MONTH PERIOD
ENDED AUGUST 31, 2006, SHOWING THE APPROXIMATE AGGREGATE DOLLAR AMOUNT OF
REVENUES FROM EACH SUCH CUSTOMER DURING SUCH PERIOD.  SELLER HAS NO WRITTEN
INFORMATION AND NO KNOWLEDGE THAT ANY OF THE CUSTOMERS LISTED ON SCHEDULE 3.9
INTENDS TO CEASE DOING BUSINESS, OR NOT RENEW CONTRACTS, WITH SELLER, OR BUYER
AFTER THE CLOSING DATE, OR ALTER MATERIALLY THE AMOUNT OF THE BUSINESS THAT ANY
OF THEM IS PRESENTLY DOING WITH SELLER, OR WILL REQUIRE, AS A CONDITION TO THE
CONTINUATION OF ITS BUSINESS RELATIONSHIP WITH SELLER, OR BUYER AFTER THE
CLOSING DATE, A CHANGE IN THE PRICES AT OR ANY OTHER MATERIAL TERMS UNDER WHICH
ANY OF SUCH CUSTOMERS HAS BEEN DOING BUSINESS WITH SELLER.

3.10        WARRANTIES AND LIABILITIES.  SCHEDULE 3.10 ATTACHED HERETO SETS
FORTH THE PRODUCT RETURN POLICIES (THE “RETURN POLICIES”) OF, AND ALL WARRANTIES
(AS HEREINAFTER DEFINED) GIVEN OR MADE BY, SELLER RELATING TO ITS BUSINESS. 
“WARRANTIES” SHALL MEAN ALL SERVICE, REPAIR, REPLACEMENT AND OTHER OBLIGATIONS
BASED UPON, OR ARISING OUT OF, EXPRESS AND IMPLIED WARRANTIES MADE OR DEEMED
MADE IN CONNECTION WITH SELLER’S BUSINESS.  SINCE AUGUST 31, 2006, SELLER HAS
NOT EXTENDED OR GRANTED ANY RETURN RIGHTS OR GIVEN OR MADE ANY WARRANTIES WITH
RESPECT TO ITS BUSINESS, EXCEPT FOR THOSE SET FORTH ON SCHEDULE 3.10.  SINCE
AUGUST 31, 2006, NONE OF SELLER’S CUSTOMERS HAS CLAIMED TO SELLER THAT SELLER’S
PRODUCTS OR SERVICES ARE DEFECTIVE.  SELLER DOES NOT KNOW OF ANY PRODUCTS OR
SERVICES WHICH HAVE BEEN DELIVERED BY SELLER SINCE AUGUST 31, 2006, IN A
CONDITION THAT SUCH PRODUCTS OR SERVICES

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MIGHT REASONABLY BE EXPECTED TO BE RETURNED BY THE CUSTOMERS OF THE BUSINESS,
AND SELLER HAS NOT RECEIVED WRITTEN NOTICE OF ANY INTENTION ON THE PART OF ANY
SUCH CUSTOMER TO RETURN ANY OF SELLER’S PRODUCTS.  EXCEPT AS OTHERWISE SET FORTH
ON SCHEDULE 3.10, SELLER DOES NOT HAVE ANY KNOWLEDGE OF ANY PRESENT OR FUTURE
CLAIM AGAINST SELLER, WHETHER OR NOT FULLY COVERED BY INSURANCE, FOR LIABILITY
ON ACCOUNT OF NEGLIGENCE OR PRODUCT LIABILITY OR ON ACCOUNT OF ANY RETURN
POLICIES OR WARRANTIES OF THE BUSINESS WHICH WOULD HAVE, INDIVIDUALLY OR IN THE
AGGREGATE, A MATERIAL ADVERSE EFFECT ON SELLER, AND ADEQUATE RESERVES HAVE BEEN
SET ASIDE IN SELLER’S FINANCIAL STATEMENTS FOR CLAIMS RELATING TO WARRANTIES AND
PRODUCT RETURNS.

3.11        INSURANCE.  SELLER HAS DELIVERED TO BUYER TRUE AND CORRECT COPIES OF
ALL INSURANCE POLICIES, INCLUDING THOSE RELATING TO COVERAGE FOR FIRE, GENERAL
LIABILITY, WORKER’S COMPENSATION, ERRORS AND OMISSIONS, MALPRACTICE AND OTHER
FORMS OF INSURANCE MAINTAINED BY OR ON BEHALF OF SELLER IN CONNECTION WITH ITS
BUSINESS AS PROTECTION FOR THE PURCHASED ASSETS (THE “INSURANCE POLICIES”).  ALL
OF SUCH POLICIES ARE NOW IN FULL FORCE AND EFFECT.  A BRIEF DESCRIPTION OF EACH
OF THE INSURANCE POLICIES IS SET FORTH ON SCHEDULE 3.11 ATTACHED HERETO.  SELLER
HAS NOT RECEIVED ANY NOTICE OF CANCELLATION OR MATERIAL AMENDMENT OF ANY SUCH
POLICIES.  NO COVERAGE THEREUNDER IS BEING DISPUTED; AND ALL MATERIAL CLAIMS
THEREUNDER HAVE BEEN FILED IN A TIMELY MANNER.

3.12        COMPLIANCE WITH LAW/PERMITS.

(A)           EXCEPT AS SET FORTH ON SCHEDULE 3.12(A), INSOFAR AS THE BUSINESS
IS CONCERNED, SELLER IS IN COMPLIANCE WITH ALL, AND IS NOT IN VIOLATION OF ANY,
LAW, ORDINANCE, ORDER, DECREE, RULE OR REGULATION OF ANY GOVERNMENTAL OR
REGULATORY AGENCY OR AUTHORITY, THE VIOLATION OF, OR NONCOMPLIANCE WITH, WHICH
COULD HAVE A MATERIAL ADVERSE EFFECT ON SELLER.  EXCEPT AS SET FORTH ON
SCHEDULE 3.12(A), NO (I) CHARGES OF VIOLATIONS OF LAWS OR REGULATIONS RELATING
TO ITS BUSINESS HAVE BEEN MADE OR, TO SELLER’S KNOWLEDGE, THREATENED, (II)
PROCEEDINGS OR INVESTIGATIONS RELATING TO ITS BUSINESS ARE PENDING OR, TO
SELLER’S KNOWLEDGE, HAVE BEEN THREATENED, AND (III) CITATIONS OR NOTICES OF
DEFICIENCY HAVE BEEN ISSUED OR, TO SELLER’S KNOWLEDGE, HAVE BEEN THREATENED,
AGAINST SELLER RELATING TO OR ARISING OUT OF ITS BUSINESS BY ANY GOVERNMENTAL OR
REGULATORY AUTHORITIES, WHICH HAS HAD OR COULD REASONABLY BE EXPECTED TO HAVE,
INDIVIDUALLY OR IN THE AGGREGATE, A MATERIAL ADVERSE EFFECT ON SELLER; AND, TO
SELLER’S KNOWLEDGE, THERE ARE NO FACTS OR CIRCUMSTANCES UPON WHICH ANY SUCH
CHARGES, PROCEEDINGS, INVESTIGATIONS, OR CITATIONS OR DEFICIENCY NOTICES,
REASONABLY MAY BE INSTITUTED, ISSUED OR BROUGHT HEREAFTER.

(B)           SCHEDULE 3.12(B) CONTAINS A TRUE, CORRECT AND COMPLETE LIST OF ALL
GOVERNMENTAL OR REGULATORY LICENSES, PERMITS, AUTHORIZATIONS, FRANCHISES,
CERTIFICATES OR RIGHTS (CONTRACTUAL OR OTHER) TO OPERATE SELLER’S BUSINESS, THAT
ARE HELD BY SELLER (COLLECTIVELY, “LICENSES AND PERMITS”).  TO THE KNOWLEDGE OF
SELLER, EACH OF SUCH LICENSES AND PERMITS ARE IN FULL FORCE AND EFFECT AS OF THE
DATE HEREOF.  THERE IS NO OTHER LICENSE, PERMIT, AUTHORIZATION, FRANCHISE,
CERTIFICATE OR RIGHT TO OPERATE THE ABSENCE OF WHICH HAS HAD A MATERIAL ADVERSE
EFFECT ON SELLER.  SELLER IS IN COMPLIANCE WITH THE CONDITIONS AND REQUIREMENTS
IMPOSED BY OR IN CONNECTION WITH SUCH LICENSES AND PERMITS.  SELLER HAS NOT
RECEIVED ANY NOTICE, NOR DOES SELLER HAVE ANY KNOWLEDGE, THAT ANY GOVERNMENTAL
AUTHORITY INTENDS TO CANCEL, TERMINATE OR MODIFY ANY OF SUCH LICENSES OR
PERMITS.

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3.13        TAXES AND TAX RETURNS.  FOR PURPOSES OF THIS AGREEMENT (A) THE TERM
“TAX” OR “TAXES” MEANS ANY FEDERAL, PROVINCIAL, STATE, LOCAL OR FOREIGN INCOME,
GROSS RECEIPTS, LICENSE, PAYROLL, EMPLOYMENT, EXCISE, SEVERANCE, STAMP,
OCCUPATION, PREMIUM, WINDFALL PROFITS, ENVIRONMENTAL (INCLUDING TAXES UNDER IRC
SECTION 59A), CUSTOMS DUTIES, CAPITAL STOCK, FRANCHISE, PROFITS, WITHHOLDING,
SOCIAL SECURITY, UNEMPLOYMENT, DISABILITY, REAL PROPERTY, PERSONAL PROPERTY,
SALES, USE, TRANSFER, REGISTRATION, VALUE ADDED, ALTERNATIVE OR ADD-ON MINIMUM,
ESTIMATED, OR OTHER TAX OF ANY KIND WHATSOEVER, INCLUDING ANY INTEREST, PENALTY
OR ADDITION THERETO, WHETHER DISPUTED OR NOT; AND (B) THE TERM “TAX RETURN”
MEANS ANY RETURN, DECLARATION, REPORT, CLAIM FOR REFUND, OR INFORMATION RETURN
OR STATEMENT (INCLUDING, WITHOUT LIMITATION, INFORMATION RETURNS OR REPORTS
RELATED TO BACK-UP WITHHOLDING AND ANY PAYMENTS TO THIRD PARTIES) RELATING TO
ANY TAXES, INCLUDING ANY SCHEDULE OR ATTACHMENT THERETO, AND INCLUDING ANY
AMENDMENT THEREOF.  ALL TAX RETURNS REQUIRED TO BE FILED WITH ANY TAXING
AUTHORITY WITH RESPECT TO ANY TAXABLE PERIOD ENDING ON OR BEFORE THE DATE OF
THIS AGREEMENT, OR THE CLOSING DATE, AS APPLICABLE, BY OR ON BEHALF OF SELLER,
HAVE BEEN OR WILL BE FILED WHEN DUE.  ALL SUCH TAX RETURNS ARE OR WILL BE TRUE,
COMPLETE AND CORRECT IN ALL MATERIAL RESPECTS.  ALL TAXES DUE AND PAYABLE BY
SELLER HAVE BEEN PAID OR ACCRUED IN THE BALANCE SHEET, EXCEPT FOR UNPAID
ACCRUABLE TAXES INCURRED BY SELLER IN THE ORDINARY COURSE OF ITS BUSINESS SINCE
THE DATE OF THE BALANCE SHEET.  BUYER SHALL HAVE NO LIABILITY OR OBLIGATION
WHATSOEVER, AND SHALL NOT INCUR ANY LOSS, EXPENSE OR COST, AND NONE OF THE
PURCHASED ASSETS, OR ANY ASSETS OF BUYER, SHALL BE SUBJECTED TO ANY ENCUMBRANCE,
BY REASON OF ANY TAXES ARISING OUT OF (X) SELLER’S BUSINESS AS CONDUCTED BY
SELLER PRIOR TO THE CONSUMMATION OF THE SALE HEREUNDER OF THE PURCHASED ASSETS
TO BUYER, OR (Y) ANY OTHER OPERATIONS OR ACTIVITIES OF SELLER WHETHER CONDUCTED
PRIOR TO THE DATE HEREOF OR HEREAFTER.  SELLER FURTHER REPRESENTS AND WARRANTS
THAT IT IS RELYING SOLELY ON ITS OWN ACCOUNTANTS AND ADVISORS FOR ADVICE AS TO
THE TAX CONSEQUENCES TO IT OF THE TRANSACTIONS CONTEMPLATED HEREBY.

3.14        LITIGATION AND PROCEEDINGS.  EXCEPT AS SET FORTH ON SCHEDULE 3.14,
THERE IS NO ACTION, SUIT, PROCEEDING OR INVESTIGATION, OR ANY COUNTER OR
CROSS-CLAIM IN AN ACTION BROUGHT AGAINST, BY OR ON BEHALF OF SELLER, WHETHER AT
LAW OR IN EQUITY, OR BEFORE OR BY ANY GOVERNMENTAL DEPARTMENT, COMMISSION,
BOARD, BUREAU, AGENCY OR INSTRUMENTALITY, DOMESTIC OR FOREIGN, OR BEFORE ANY
ARBITRATOR OF ANY KIND, THAT IS PENDING OR, TO SELLER’S KNOWLEDGE, THREATENED, 
WHICH (I) COULD REASONABLY BE EXPECTED TO AFFECT ADVERSELY SELLER’S ABILITY TO
PERFORM ITS OBLIGATIONS UNDER THIS AGREEMENT OR THE BILL OF SALE OR COMPLETE ANY
OF THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY, OR (II)  WHICH MAY BECOME A
CLAIM, OR LIABILITY AGAINST BUYER OR THE PURCHASED ASSETS.  TO SELLER’S
KNOWLEDGE, THERE ARE NO FACTS OR CIRCUMSTANCES THAT COULD REASONABLY BE EXPECTED
TO GIVE RISE TO ANY ACTIONS OF THE TYPE SET FORTH IN THIS SECTION 3.14.  SELLER
IS NOT SUBJECT TO ANY JUDGMENT, ORDER, WRIT, INJUNCTION, DECREE OR AWARD OF ANY
COURT, ARBITRATOR OR GOVERNMENTAL DEPARTMENT, COMMISSION, BOARD, BUREAU, AGENCY
OR INSTRUMENTALITY HAVING JURISDICTION OVER SELLER, ANY OF THE PURCHASED ASSETS
OR ITS BUSINESS THAT AFFECTS, INVOLVES OR RELATES TO THE PURCHASED ASSETS.

3.15        ENVIRONMENTAL AND SAFETY MATTERS.  SELLER HAS COMPLIED WITH, AND THE
OPERATION OF ITS BUSINESS AND THE USE AND OWNERSHIP OF THE PURCHASED ASSETS, ARE
IN COMPLIANCE WITH ALL FEDERAL, PROVINCIAL, STATE, REGIONAL, LOCAL OR OTHER
GOVERNMENTAL STATUTES, LAWS, ORDINANCES, RULES, REGULATIONS AND ORDERS RELATING
TO THE PROTECTION OF HUMAN HEALTH AND SAFETY, NATURAL RESOURCES OR THE
ENVIRONMENT, INCLUDING, BUT NOT LIMITED TO, AIR POLLUTION, WATER POLLUTION,
NOISE CONTROL, ON SITE OR OFF SITE HAZARDOUS SUBSTANCE DISCHARGE, DISPOSAL OR
RECOVERY, TOXIC OR HAZARDOUS SUBSTANCES, TRAINING, INFORMATION AND WARNING
PROVISIONS RELATING TO TOXIC OR HAZARDOUS SUBSTANCES, AND EMPLOYEE SAFETY
RELATING TO ITS BUSINESS OR THE PURCHASED ASSETS (COLLECTIVELY THE
“ENVIRONMENTAL LAWS”); AND NO NOTICE OF VIOLATION OF ANY ENVIRONMENTAL LAWS OR
OF ANY PERMIT, LICENSE OR OTHER AUTHORIZATION RELATING THERETO HAS BEEN RECEIVED
OR THREATENED AGAINST SELLER IN CONNECTION WITH ITS BUSINESS, AND TO

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THE KNOWLEDGE OF SELLER, THERE IS NO FACTUAL BASIS FOR THE GIVING OF ANY SUCH
NOTICE.  SELLER HAS NOT RECEIVED ANY NOTICE OR CLAIM TO THE EFFECT THAT SELLER
OR ITS BUSINESS IS OR MAY BE LIABLE TO ANY GOVERNMENTAL AUTHORITY OR PRIVATE
PARTY AS A RESULT OF THE RELEASE OR THREATENED RELEASE OF ANY TOXIC OR HAZARDOUS
SUBSTANCES IN CONNECTION WITH THE CONDUCT OR OPERATION OF ITS BUSINESS, AND TO
SELLER’S KNOWLEDGE, THERE ARE NO FACTS OR CIRCUMSTANCES THAT COULD REASONABLY BE
EXPECTED TO GIVE RISE TO SUCH A CLAIM.  NONE OF THE OPERATIONS OF SELLER’S
BUSINESS OR SELLER AND NONE OF THE PURCHASED ASSETS IS THE SUBJECT OF ANY
FEDERAL, STATE, PROVINCIAL OR LOCAL INVESTIGATION EVALUATING WHETHER ANY
REMEDIAL ACTION IS NEEDED TO RESPOND TO A RELEASE OR A THREATENED RELEASE OF ANY
TOXIC OR HAZARDOUS SUBSTANCES AT ANY REAL PROPERTIES LEASED, USED OR OPERATED BY
SELLER IN CONNECTION WITH ITS BUSINESS OR ANY OTHER OPERATIONS OR ACTIVITIES OF
SELLER.

3.16        EMPLOYEE BENEFIT PLANS.

(A)           THE SELLER HAS PROVIDED BUYER WITH COMPLETE AND ACCURATE (I)
COPIES OF ALL EMPLOYEE BENEFIT PLANS THAT HAVE BEEN REDUCED TO WRITING AND (II)
ALL EXISTING WRITTEN SUMMARIES OF ANY EMPLOYEE BENEFIT PLANS, WHETHER OR NOT
REDUCED TO WRITING (“BENEFIT PLAN”).  ALL BENEFIT PLANS ARE, AND IN
ADMINISTERING SUCH PLANS THE SELLER IS, IN COMPLIANCE IN ALL MATERIAL RESPECTS
WITH ALL APPLICABLE LAWS.  EXCEPT AS SET FORTH IN SCHEDULE 3.16, THE OCCURRENCE
OF THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT WILL NOT RESULT IN THE
VESTING OR ACCELERATION OF ANY BENEFITS UNDER SUCH BENEFIT PLANS OR ANY PAYMENT
OBLIGATIONS, INCLUDING SEVERANCE, UNDER ANY SUCH BENEFIT PLANS.

(B)           ALL COSTS OF ADMINISTERING AND CONTRIBUTIONS REQUIRED TO BE MADE
BY SELLER TO EACH BENEFIT PLAN UNDER THE TERMS OF THAT BENEFIT PLAN, AND ALL
APPLICABLE LAWS HAVE IN ALL MATERIAL RESPECTS BEEN TIMELY MADE.  ALL AMOUNTS
PROPERLY ACCRUED TO DATE AS LIABILITIES OF SELLER UNDER OR WITH RESPECT TO EACH
BENEFIT PLAN (INCLUDING ADMINISTRATIVE EXPENSES AND INCURRED BUT NOT REPORTED
CLAIMS) FOR THE CURRENT PLAN YEAR OF THE BENEFIT PLAN HAVE BEEN RECORDED ON THE
APPROPRIATE BOOKS, TO THE EXTENT REQUIRED BY LAW OR GAAP.

(C)           EACH BENEFIT PLAN HAS BEEN MAINTAINED AND OPERATED IN ACCORDANCE
WITH, AND COMPLIES CURRENTLY WITH, IN ALL MATERIAL RESPECTS, ALL APPLICABLE
LAWS.  EACH BENEFIT PLAN HAS BEEN OPERATED IN ALL MATERIAL RESPECTS IN
ACCORDANCE WITH ITS TERMS.

(D)           SELLER DOES NOT MAINTAIN ANY PLAN THAT PROVIDES (OR WILL PROVIDE)
MEDICAL OR DEATH BENEFITS TO ONE OR MORE, CURRENT OR FUTURE FORMER EMPLOYEES
(INCLUDING RETIREES) BEYOND THEIR RETIREMENT OR OTHER TERMINATION OF SERVICE.

(E)           THERE ARE NO PROCEEDINGS OR LAWSUITS, PENDING OR, TO SELLER’S
KNOWLEDGE, THREATENED, AND, TO SELLER’S KNOWLEDGE, THERE ARE NO INVESTIGATIONS
CURRENTLY IN PROGRESS RELATING TO ANY BENEFIT PLAN, BY ANY ADMINISTRATIVE
AGENCY, WHETHER LOCAL, PROVINCIAL OR FEDERAL OR BY ANY FIDUCIARY, PARTICIPANT OR
BENEFICIARY OF SUCH PLAN.

3.17        COLLECTIVE BARGAINING ARRANGEMENTS.  SELLER IS NOT A PARTY TO OR
BOUND BY ANY EMPLOYEE COLLECTIVE BARGAINING AGREEMENT, A PARTY TO OR AFFECTED BY
OR, TO SELLER’S KNOWLEDGE, THREATENED WITH, ANY DISPUTE OR CONTROVERSY WITH A
UNION OR WITH RESPECT TO UNIONIZATION OR COLLECTIVE BARGAINING INVOLVING THE
EMPLOYEES OF SELLER.

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3.18        ACCOUNTS RECEIVABLE; UNEARNED INCOME.

(A)           THE ACCOUNTS RECEIVABLE REFLECTED ON THE BALANCE SHEET ARE OWNED
FREE AND CLEAR BY SELLER AND ARE BASED ON SELLER’S REASONABLE JUDGMENT AND ITS
NORMAL CREDIT REVIEW PROCEDURES, BUSINESS PRACTICES AND GAAP, AND ARE FULLY
COLLECTIBLE IN ACCORDANCE WITH THEIR TERMS IN AN AMOUNT NOT LESS THAN THEIR
AGGREGATE BOOK VALUE, EXCEPT FOR ANY AMOUNTS THAT BECOME UNCOLLECTIBLE AFTER THE
CLOSING DATE DUE TO ACTIONS TAKEN BY BUYER WHICH COULD REASONABLY BE EXPECTED TO
HAVE A MATERIAL ADVERSE EFFECT ON THE COLLECTIBILITY OF THE ACCOUNTS
RECEIVABLE.  “AGGREGATE BOOK VALUE”, FOR THIS PURPOSE, SHALL MEAN THE AGGREGATE
RECORDED AMOUNTS OF SUCH ACCOUNTS RECEIVABLE, LESS THE AGGREGATE RECORDED
ALLOWANCE FOR DOUBTFUL ACCOUNTS, TRADE ALLOWANCES AND RETURN ALLOWANCES, ALL AS
ESTABLISHED IN ACCORDANCE WITH GAAP CONSISTENTLY APPLIED.  ALL ACCOUNTS
RECEIVABLE FOR CUSTOMER COLLECTIONS AND BILLINGS PRIOR TO THE CLOSING DATE HAVE
BEEN PROPERLY RECORDED ON SELLER’S BOOKS AND RECORDS ON A TIMELY BASIS AND IN
THE MONTH IN WHICH SELLER’S EFFORTS AND ACTIVITIES GENERATING SUCH INCOME WERE
EXPENDED.

(B)           THE UNEARNED INCOME REFLECTED ON THE BALANCE SHEET IS BASED ON
SELLER’S REASONABLE JUDGMENT, BUSINESS PRACTICES, AS ESTABLISHED IN ACCORDANCE
WITH GAAP CONSISTENTLY APPLIED.  ALL UNEARNED INCOME RELATING TO CONTRACTS
EXECUTED PRIOR TO THE CLOSING DATE HAVE BEEN PROPERLY RECORDED ON SELLER’S BOOKS
AND RECORDS ON A TIMELY BASIS AND IN THE MONTH IN WHICH SELLER’S RECEIVED THE
CASH PAYMENT.

3.19        EMPLOYEES, DIRECTORS AND OFFICERS.  SCHEDULE 3.19 COMPRISES A
COMPLETE AND CORRECT LIST OF ALL OF SELLER’S PRESENT EMPLOYEES WHO DEVOTE A
SIGNIFICANT PORTION OF THEIR TIME TO THE BUSINESS (“EMPLOYEES”), INCLUDING THE
DIRECT COMPENSATION (INCLUDING WAGES, SALARIES AND ACTUAL OR ANTICIPATED
BONUSES) TO BE PAID IN THE CURRENT FISCAL YEAR TO SUCH PERSONS.  NO UNPAID
SALARY, OTHER THAN FOR THE IMMEDIATELY PRECEDING PAY PERIOD AND OTHER THAN
PURSUANT TO THE EXISTING DEFERRED COMPENSATION PLANS OF SELLER, IS NOW PAYABLE
TO ANY OF SUCH EMPLOYEES.  SELLER (I) IS IN COMPLIANCE IN ALL MATERIAL RESPECTS
WITH ALL APPLICABLE FOREIGN, FEDERAL, PROVINCIAL AND LOCAL LAWS, RULES AND
REGULATIONS RESPECTING EMPLOYMENT, EMPLOYMENT PRACTICES, TERMS AND CONDITIONS OF
EMPLOYMENT AND WAGES AND HOURS, (II) HAS WITHHELD ALL AMOUNTS REQUIRED BY LAW OR
BY AGREEMENT TO BE WITHHELD FROM THE WAGES, SALARIES AND OTHER PAYMENTS TO ITS
EMPLOYEES, (III) IS NOT LIABLE FOR ANY ARREARS OF WAGES OR ANY TAXES OR ANY
PENALTY FOR FAILURE TO COMPLY WITH ANY OF THE FOREGOING, AND (IV) IS NOT LIABLE
FOR ANY PAYMENT TO ANY TRUST OR OTHER FUND OR TO ANY GOVERNMENTAL ENTITY WITH
RESPECT TO UNEMPLOYMENT COMPENSATION BENEFITS, SOCIAL SECURITY OR OTHER BENEFITS
OR OBLIGATIONS FOR EMPLOYEES.

3.20        OPERATIONAL RESTRICTIONS.  SELLER’S BUSINESS IS NOT SUBJECT TO (A)
ANY RESTRICTIONS UNDER ANY APPLICABLE LAWS OR REGULATIONS OR (B) ANY CONSTATING
DOCUMENT OR OTHER CORPORATE OR CONTRACTUAL RESTRICTION OR (C) ANY JUDGMENT,
ORDER, WRIT, INJUNCTION, DECREE OR ORDER, WHICH HAS HAD OR COULD REASONABLY BE
EXPECTED TO HAVE A MATERIAL ADVERSE EFFECT ON SELLER.

3.21        INVENTORY.  THE INVENTORIES OF THE SELLER ARE IN GOOD AND MARKETABLE
CONDITION AND ARE SALEABLE IN THE ORDINARY COURSE OF BUSINESS, OTHER THAN WHAT
IS RESERVED FOR OBSOLESCENCE ON THE FINANCIAL STATEMENTS.  SINCE THE DATE OF THE
BALANCE SHEET, SELLER HAS MAINTAINED INVENTORY AT LEVELS CONSISTENT WITH
SELLER’S PAST PRACTICES IN THE ORDINARY COURSE OF BUSINESS.

3.22        NO BROKER.  SELLER HAS NOT RETAINED OR USED THE SERVICES OF AN
AGENT, FINDER OR BROKER IN CONNECTION WITH THE TRANSACTIONS CONTEMPLATED BY THIS
AGREEMENT.  SELLER SHALL PAY, AND SHALL INDEMNIFY, HOLD HARMLESS AND DEFEND
BUYER FROM AND AGAINST, ALL COMMISSIONS, FINDER’S AND OTHER FEES AND EXPENSES
CHARGED OR ASSERTED BY ANY AGENT, FINDER OR BROKER, BY REASON OF ANY SUCH
RETENTION OR USE OF THE SERVICES OF ANY SUCH AGENT, FINDER OR BROKER BY SELLER.

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3.23        AFFILIATE TRANSACTIONS.  OTHER THAN TRANSACTIONS WHICH DO NOT IMPAIR
THE SELLER’S ABILITY TO TRANSFER GOOD, COMPLETE AND MARKETABLE TITLE TO THE
PURCHASED ASSETS TO THE BUYER, AND EXCEPT AS SET FORTH ON SCHEDULE 3.23, THERE
ARE NO LOANS, LEASES OR OTHER AGREEMENTS OR TRANSACTION BETWEEN SELLER AND ANY
PRESENT DIRECTOR, OFFICER, SHAREHOLDER OR EMPLOYEE OF SELLER, OR TO SELLER’S
KNOWLEDGE, ANY MEMBER OF SUCH DIRECTOR’S, OFFICER’S, STOCKHOLDER’S OR EMPLOYEE’S
IMMEDIATE FAMILY, OTHER THAN COMPENSATION ARRANGEMENTS ENTERED INTO WITH
EMPLOYEES IN THE ORDINARY COURSE OF BUSINESS IN CONNECTION WITH PAST.

3.24        INVESTMENT REPRESENTATIONS AND WARRANTIES.  SELLER AND THE PRINCIPAL
OWNERS (EACH AN “INVESTOR” FOR PURPOSES OF THIS SECTION 3.24 ONLY) REPRESENT AND
WARRANT TO PARENT, SEVERALLY AND SOLELY WITH RESPECT TO THEMSELVES AND THEIR
RESPECTIVE INVESTMENTS IN, AND RECEIPT OF, THE COMMON STOCK HEREUNDER, THAT:

(A)           THE INVESTOR IS INVESTING IN THE COMMON STOCK FOR ITS OWN ACCOUNT
AND NOT WITH A PRESENT VIEW TOWARD THE PUBLIC SALE OR DISTRIBUTION THEREOF,
EXCEPT PURSUANT TO SALES REGISTERED OR EXEMPTED FROM REGISTRATION UNDER THE
SECURITIES ACT; PROVIDED, HOWEVER, THAT BY MAKING THE REPRESENTATION HEREIN, THE
INVESTOR DOES NOT AGREE TO HOLD ANY OF THE COMMON STOCK FOR ANY MINIMUM OR OTHER
SPECIFIC TERM AND RESERVES THE RIGHT TO DISPOSE OF THE COMMON STOCK AT ANY TIME
IN ACCORDANCE WITH, OR PURSUANT TO, A REGISTRATION STATEMENT FILED IN ACCORDANCE
WITH SECTION 5.5 BELOW, OR AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES
ACT.

(B)           THE INVESTOR IS AN “ACCREDITED INVESTOR” AS DEFINED IN RULE 501(A)
OF REGULATION D.  THE INVESTOR HAS DELIVERED TO PARENT AN INVESTOR QUESTIONNAIRE
IN SUBSTANTIALLY THE FORM SET FORTH ON EXHIBIT D.

(C)           THE INVESTOR UNDERSTANDS THAT THE COMMON STOCK IS BEING OFFERED
AND SOLD TO IT IN RELIANCE UPON SPECIFIC EXEMPTIONS FROM THE REGISTRATION
REQUIREMENTS OF UNITED STATES FEDERAL AND STATE SECURITIES LAWS AND THAT PARENT
IS RELYING UPON THE TRUTH AND ACCURACY OF, AND THE INVESTOR’S COMPLIANCE WITH,
THE REPRESENTATIONS, WARRANTIES, AGREEMENTS, ACKNOWLEDGMENTS AND UNDERSTANDINGS
OF THE INVESTOR SET FORTH HEREIN IN ORDER TO DETERMINE THE AVAILABILITY OF SUCH
EXEMPTIONS AND THE ELIGIBILITY OF THE INVESTOR TO ACQUIRE THE COMMON STOCK.

(D)           THE INVESTOR AND ITS ADVISORS, IF ANY, HAVE BEEN FURNISHED WITH
ALL MATERIALS RELATING TO THE BUSINESS, FINANCES AND OPERATIONS OF PARENT, AND
MATERIALS RELATING TO THE OFFER AND SALE OF THE COMMON STOCK, THAT HAVE BEEN
REQUESTED BY THE INVESTOR OR ITS ADVISORS, IF ANY.  THE INVESTOR AND ITS
ADVISORS, IF ANY, HAVE BEEN AFFORDED THE OPPORTUNITY TO ASK QUESTIONS OF
PARENT.  THE INVESTOR ACKNOWLEDGES AND UNDERSTANDS THAT ITS INVESTMENT IN THE
COMMON STOCK INVOLVES A SIGNIFICANT DEGREE OF RISK.

(E)           THE INVESTOR UNDERSTANDS THAT NO UNITED STATES FEDERAL OR STATE
AGENCY, OR ANY OTHER GOVERNMENT OR GOVERNMENTAL AGENCY, HAS PASSED UPON OR MADE
ANY RECOMMENDATION OR ENDORSEMENT OF THE COMMON STOCK OR AN INVESTMENT THEREIN.

(F)            THE INVESTOR UNDERSTANDS THAT:

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(I)            EXCEPT AS PROVIDED IN SECTION 5.5 BELOW, THE COMMON STOCK HAS NOT
BEEN, AND IS NOT BEING, REGISTERED UNDER THE SECURITIES ACT OR ANY APPLICABLE
STATE SECURITIES LAWS AND, CONSEQUENTLY, THE INVESTOR MAY HAVE TO BEAR THE RISK
OF OWNING THE COMMON STOCK FOR AN INDEFINITE PERIOD OF TIME BECAUSE THE COMMON
STOCK MAY NOT BE TRANSFERRED UNLESS (A) THE RESALE OF THE COMMON STOCK IS
REGISTERED PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES
ACT, (B) THE INVESTOR HAS DELIVERED TO THE COMPANY AN OPINION OF COUNSEL (IN
FORM, SUBSTANCE AND SCOPE CUSTOMARY FOR OPINIONS OF COUNSEL IN COMPARABLE
TRANSACTIONS) TO THE EFFECT THAT THE COMMON STOCK TO BE SOLD OR TRANSFERRED MAY
BE SOLD OR TRANSFERRED PURSUANT TO AN EXEMPTION FROM SUCH REGISTRATION, (C) THE
COMMON STOCK IS SOLD OR TRANSFERRED PURSUANT TO RULE 144, PROMULGATED UNDER THE
SECURITIES ACT (“RULE 144”), OR (D) THE COMMON STOCK IS SOLD OR TRANSFERRED TO
AN AFFILIATE (AS DEFINED IN RULE 144) OF THE INVESTOR; PROVIDED THAT,
NOTWITHSTANDING ANY OTHER PROVISION IN THIS AGREEMENT TO THE CONTRARY, THE
PARTIES AGREE AND ACKNOWLEDGE THAT SELLER MAY DISTRIBUTE ANY COMMON STOCK THAT
IT RECEIVES TO THE SHAREHOLDER, AND THE SHAREHOLDER MAY DISTRIBUTE ANY COMMON
STOCK THAT IT RECEIVES TO THE PRINCIPAL OWNER, AND PARENT HEREBY CONSENTS TO ANY
SUCH DISTRIBUTIONS.

(II)           ANY SALE OF THE COMMON STOCK MADE IN RELIANCE ON RULE 144 MAY BE
MADE ONLY IN ACCORDANCE WITH THE TERMS OF RULE 144 AND, IF RULE 144 IS NOT
APPLICABLE, ANY RESALE OF THE COMMON STOCK UNDER CIRCUMSTANCES IN WHICH THE
SELLER (OR THE PERSON THROUGH WHOM THE SALE IS MADE) MAY BE DEEMED TO BE AN
UNDERWRITER (AS THAT TERM IS DEFINED IN THE SECURITIES ACT) MAY REQUIRE
COMPLIANCE WITH SOME OTHER EXEMPTION UNDER THE SECURITIES ACT, OR THE RULES AND
REGULATIONS OF THE SEC THEREUNDER; AND

(III)          EXCEPT AS PROVIDED IN SECTION 5.5 BELOW, NEITHER PARENT NOR ANY
OTHER PERSON IS UNDER ANY OBLIGATION TO REGISTER THE COMMON STOCK UNDER THE
SECURITIES ACT OR ANY STATE SECURITIES LAWS OR TO COMPLY WITH THE TERMS AND
CONDITIONS OF ANY EXEMPTION THEREUNDER.

(G)           THE INVESTOR UNDERSTANDS THAT UNTIL (A) THE COMMON STOCK MAY BE
SOLD BY THE INVESTOR UNDER RULE 144(K) OR (B) SUCH TIME AS THE RESALE OF THE
COMMON STOCK HAS BEEN REGISTERED UNDER THE SECURITIES ACT AS CONTEMPLATED BY
SECTION 5.5 BELOW, THE CERTIFICATES REPRESENTING THE COMMON STOCK WILL BEAR A
RESTRICTIVE LEGEND IN SUBSTANTIALLY THE FOLLOWING FORM (AND A STOP-TRANSFER
ORDER MAY BE PLACED AGAINST TRANSFER OF THE CERTIFICATES FOR SUCH COMMON STOCK):

THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE OF
THE UNITED STATES.  THE SECURITIES MAY NOT BE SOLD, TRANSFERRED OR ASSIGNED IN
THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER
APPLICABLE SECURITIES LAWS, OR UNLESS OFFERED, SOLD OR TRANSFERRED PURSUANT TO
AN AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THOSE LAWS.

3.25        REPRESENTATIONS AND WARRANTIES OF SELLER AND THE PRINCIPAL OWNERS. 
THE REPRESENTATIONS AND WARRANTIES OF SELLER AND THE PRINCIPAL OWNERS CONTAINED
HEREIN, AND THE DISCLOSURES CONTAINED IN SELLER’S DISCLOSURE SCHEDULE DO NOT
CONTAIN ANY STATEMENT OF A MATERIAL FACT THAT WAS UNTRUE WHEN MADE OR OMITS ANY
INFORMATION NECESSARY TO MAKE ANY SUCH STATEMENT CONTAINED THEREIN, IN LIGHT OF
THE CIRCUMSTANCES UNDER WHICH SUCH STATEMENT WAS MADE, NOT MISLEADING.  THE
COPIES OF ALL DOCUMENTS FURNISHED BY SELLER TO PARENT PURSUANT TO THE TERMS OF
THIS AGREEMENT ARE COMPLETE AND ACCURATE COPIES OF THE ORIGINAL DOCUMENTS.

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ARTICLE IV

REPRESENTATIONS AND WARRANTIES OF BUYER AND PARENT

Buyer and Parent hereby make the representations and warranties set forth in
this Article IV to Seller:

4.1          AUTHORITY AND BINDING EFFECT.  BUYER AND PARENT HAVE THE FULL
CORPORATE POWER AND AUTHORITY TO EXECUTE AND DELIVER THIS AGREEMENT AND THE BILL
OF SALE.  THIS AGREEMENT, AND THE BILL OF SALE, AND THE CONSUMMATION BY BUYER
AND PARENT OF ITS OBLIGATIONS CONTAINED HEREIN AND THEREIN, HAVE BEEN DULY
AUTHORIZED BY ALL NECESSARY CORPORATE ACTIONS OF BUYER AND PARENT, AND SUCH
AGREEMENTS HAVE BEEN DULY EXECUTED AND DELIVERED BY BUYER AND PARENT.  THIS
AGREEMENT IS A VALID AND BINDING AGREEMENT OF BUYER AND PARENT, ENFORCEABLE
AGAINST BUYER AND PARENT IN ACCORDANCE WITH ITS TERMS, AND, UPON EXECUTION AND
DELIVERY, THE BILL OF SALE WILL BE VALID AND BINDING AGREEMENTS OF BUYER AND
PARENT AND SHALL BE ENFORCEABLE AGAINST THEM IN ACCORDANCE WITH ITS TERMS,
EXCEPT AS ENFORCEABILITY OF THE OBLIGATIONS OF BUYER AND PARENT UNDER THIS
AGREEMENT AND THE BILL OF SALE MAY BE LIMITED BY (I) BANKRUPTCY, INSOLVENCY,
MORATORIUM OR OTHER SIMILAR LAWS AFFECTING CREDITORS’ RIGHTS GENERALLY, AND (II)
GENERAL PRINCIPLES OF EQUITY RELATING TO THE AVAILABILITY OF EQUITABLE REMEDIES
(WHETHER SUCH AGREEMENTS ARE SOUGHT TO BE ENFORCED IN A PROCEEDING AT LAW OR A
PROCEEDING IN EQUITY).  IT IS NOT NECESSARY FOR BUYER OR PARENT TO TAKE ANY
ACTION OR TO OBTAIN ANY APPROVAL, CONSENT OR RELEASE BY OR FROM ANY THIRD
PERSON, GOVERNMENTAL OR OTHER, TO ENABLE BUYER OR PARENT TO ENTER INTO OR
PERFORM ITS OBLIGATIONS UNDER THIS AGREEMENT AND THE BILL OF SALE.

4.2          ORGANIZATION AND STANDING.  BUYER AND PARENT ARE CORPORATIONS DULY
ORGANIZED AND VALIDLY EXISTING UNDER, AND ARE IN GOOD STANDING UNDER, THE LAWS
OF THE PROVINCE OF ONTARIO AND STATE OF DELAWARE, RESPECTIVELY.  BUYER AND
PARENT HAVE THE REQUISITE CORPORATE POWER TO OWN AND OPERATE THEIR RESPECTIVE
PROPERTIES AND ASSETS, AND TO CARRY ON THEIR RESPECTIVE BUSINESS AS PRESENTLY
CONDUCTED.  BUYER AND PARENT ARE DULY QUALIFIED TO DO BUSINESS AND ARE IN GOOD
STANDING IN EACH JURISDICTION IN WHICH THE CHARACTER OF THE BUSINESS CONDUCTED
BY THEM OR THE LOCATION OF THE PROPERTIES OWNED OR LEASED BY THEM MAKE SUCH
QUALIFICATION NECESSARY, EXCEPT FOR JURISDICTIONS IN WHICH THE FAILURE TO SO
QUALIFY WOULD NOT HAVE A MATERIAL ADVERSE EFFECT ON BUYER OR PARENT.

4.3          SEC DOCUMENTS; FINANCIAL STATEMENTS.

(A)           PARENT HAS FILED ALL FORMS, REPORTS AND DOCUMENTS REQUIRED TO BE
FILED BY PARENT WITH THE SECURITIES AND EXCHANGE COMMISSION (THE “SEC”) SINCE
JULY 1, 2005 (THE “SEC DOCUMENTS”).  AS OF THEIR RESPECTIVE FILING DATES, THE
SEC DOCUMENTS COMPLIED IN ALL MATERIAL RESPECTS WITH THE REQUIREMENTS OF THE
SECURITIES ACT AND THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED (THE
“EXCHANGE ACT”), AND NONE OF THE SEC DOCUMENTS CONTAINED ANY UNTRUE STATEMENT OF
A MATERIAL FACT OR OMITTED TO STATE A MATERIAL FACT REQUIRED TO BE STATED
THEREIN OR NECESSARY TO MAKE THE STATEMENTS MADE THEREIN, IN LIGHT OF THE
CIRCUMSTANCES IN WHICH THEY WERE MADE, NOT MISLEADING, EXCEPT TO THE EXTENT
CORRECTED BY SUBSEQUENTLY FILED SEC DOCUMENTS.

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(B)           THE FINANCIAL STATEMENTS OF PARENT INCLUDED IN THE SEC DOCUMENTS
WERE COMPLETE AND CORRECT IN ALL MATERIAL RESPECTS AS OF THEIR RESPECTIVE FILING
DATES; COMPLIED AS TO FORM IN ALL MATERIAL RESPECTS WITH APPLICABLE ACCOUNTING
REQUIREMENTS AND WITH THE PUBLISHED RULES AND REGULATIONS OF THE SEC WITH
RESPECT THERETO; WERE PREPARED IN ACCORDANCE WITH GAAP APPLIED ON A CONSISTENT
BASIS AND FAIRLY PRESENT THE CONSOLIDATED FINANCIAL CONDITION AND OPERATING
RESULTS OF PARENT AT THE DATES AND DURING THE PERIODS INDICATED THEREIN.

4.4          COMPLIANCE WITH OTHER INSTRUMENTS.  THE EXECUTION AND DELIVERY OF
THIS AGREEMENT, THE BILL OF SALE, AND ALL OTHER AGREEMENTS TO BE ENTERED INTO IN
CONNECTION HEREWITH, AND THE CONSUMMATION OF THE TRANSACTIONS CONTEMPLATED
HEREBY AND THEREBY, WILL NOT CONFLICT WITH OR RESULT IN ANY VIOLATION OF ANY
LAW, RULE, REGULATION, JUDGMENT, ORDER, DECREE OR ORDINANCE APPLICABLE TO BUYER
OR PARENT OR ANY OF THEIR RESPECTIVE PROPERTIES OR ASSETS, OR CONFLICT WITH OR
RESULT IN ANY BREACH OR DEFAULT (WITH OR WITHOUT NOTICE OR LAPSE OF TIME, OR
BOTH) UNDER, OR GIVE RISE TO A RIGHT OF TERMINATION, CANCELLATION OR
ACCELERATION OF ANY OBLIGATION OR TO LOSS OF A MATERIAL BENEFIT, UNDER (I) ANY
PROVISIONS OF THE RESPECTIVE CERTIFICATES OF INCORPORATION OR BYLAWS OF BUYER OR
PARENT; OR (II) ANY MATERIAL AGREEMENT, CONTRACT, NOTE, MORTGAGE, INDENTURE,
LEASE, INSTRUMENT, PERMIT, CONCESSION, FRANCHISE OR LICENSE OR ANY WRIT, ORDER
OR DECREE TO WHICH BUYER OR PARENT ARE A PARTY OR BY WHICH BUYER OR PARENT OR
ANY OF THEIR RESPECTIVE PROPERTIES ARE BOUND.

4.5          CONSENTS AND APPROVALS; NO VIOLATIONS.  EXCEPT FOR FILINGS,
PERMITS, AUTHORIZATIONS, CONSENTS AND APPROVALS AS MAY BE REQUIRED UNDER, AND
OTHER APPLICABLE REQUIREMENTS OF, THE SECURITIES ACT, THE EXCHANGE ACT, AND THE
RULES AND REGULATIONS PROMULGATED THEREUNDER, OR OF ANY REGULATORY AUTHORITY
PURSUANT THERETO, OR OF ANY STATE SECURITIES OR BLUE SKY LAWS, NO FILING WITH OR
NOTICE TO, AND NO PERMIT, AUTHORIZATION, CONSENT OR APPROVAL OF, ANY THIRD
PARTY, GOVERNMENTAL OR OTHER ENTITY IS NECESSARY FOR THE CONSUMMATION BY BUYER
OR PARENT OF THE TRANSACTIONS CONTEMPLATED HEREBY.

4.6          LITIGATION AND PROCEEDINGS.  THERE IS NO ACTION, SUIT, PROCEEDING
OR INVESTIGATION, OR ANY COUNTER OR CROSS-CLAIM IN AN ACTION BROUGHT AGAINST, BY
OR ON BEHALF OF BUYER OR PARENT, WHETHER AT LAW OR IN EQUITY, OR BEFORE OR BY
ANY GOVERNMENTAL DEPARTMENT, COMMISSION, BOARD, BUREAU, AGENCY OR
INSTRUMENTALITY, DOMESTIC OR FOREIGN, OR BEFORE ANY ARBITRATOR OF ANY KIND, THAT
IS PENDING OR, TO BUYER’S KNOWLEDGE AND PARENT’S KNOWLEDGE, THREATENED, WHICH
(I) COULD REASONABLY BE EXPECTED TO ADVERSELY AFFECT BUYER’S ABILITY OR PARENT’S
ABILITY TO PERFORM THEIR RESPECTIVE OBLIGATIONS UNDER THIS AGREEMENT, OR THE
BILL OF SALE, OR COMPLETE ANY OF THE TRANSACTIONS CONTEMPLATED HEREBY OR
THEREBY, OR (II) WHICH MAY BECOME A CLAIM, OR LIABILITY AGAINST BUYER OR
PARENT.  TO BUYER’S KNOWLEDGE AND PARENT’S KNOWLEDGE, THERE ARE NO FACTS OR
CIRCUMSTANCES THAT COULD REASONABLY BE EXPECTED TO GIVE RISE TO ANY ACTIONS OF
THE TYPE SET FORTH IN THIS SECTION 4.6.

4.7          NO BROKER.  BUYER AND PARENT HAVE NOT RETAINED OR USED THE SERVICES
OF AN AGENT, FINDER OR BROKER IN CONNECTION WITH THE TRANSACTIONS CONTEMPLATED
BY THIS AGREEMENT.  BUYER AND PARENT SHALL PAY, AND SHALL INDEMNIFY, HOLD
HARMLESS AND DEFEND SELLER FROM AND AGAINST, ALL COMMISSIONS, FINDER’S AND OTHER
FEES AND EXPENSES CHARGED OR ASSERTED BY ANY AGENT, FINDER OR BROKER, BY REASON
OF ANY SUCH RETENTION OR USE OF THE SERVICES OF ANY SUCH AGENT, FINDER OR BROKER
BY BUYER OR PARENT.

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4.8          CAPITALIZATION.  THE ENTIRE AUTHORIZED CAPITAL STOCK OF PARENT
CONSISTS OF (A) 450,000,000 COMMON SHARES, OF WHICH 56,054,526 SHARES WERE
ISSUED AND OUTSTANDING AS OF SEPTEMBER 30, 2006, AND NO SHARES WERE HELD IN
TREASURY AS OF SEPTEMBER 30, 2006, AND (B) 10,000,000 SERIES A PREFERRED SHARES,
OF WHICH NONE WAS ISSUED AND OUTSTANDING AND NONE WAS HELD IN TREASURY AS OF
SEPTEMBER 30, 2006.  ALL OF THE ISSUED AND OUTSTANDING SHARES OF CAPITAL STOCK
OF PARENT HAVE BEEN DULY AUTHORIZED AND ARE VALIDLY ISSUED, FULLY PAID AND
NON-ASSESSABLE.  THERE ARE NO PREEMPTIVE RIGHTS THAT HAVE NOT BEEN WAIVED OR
TERMINATED WITH RESPECT TO THE SHARES OF COMMON STOCK TO BE ISSUED TO SELLER
PURSUANT TO THIS AGREEMENT.  ALL SHARES OF COMMON STOCK TO BE ISSUED TO SELLER
PURSUANT TO THIS AGREEMENT WILL BE DULY AUTHORIZED FOR ISSUANCE, VALIDLY ISSUED,
FULLY PAID AND NONASSESSABLE AND OF THE SAME CLASS OF COMMON SHARES AS ARE
CURRENTLY LISTED BY PARENT FOR TRADING ON THE OTC UNDER THE SYMBOL “DYNK”.  EACH
SHARE OF COMMON STOCK OF PARENT, INCLUDING EACH SHARE ISSUED TO SELLER PURSUANT
TO THIS AGREEMENT, HAS ONE VOTE PER SHARE ON ALL MATTERS ON WHICH THE
STOCKHOLDERS OF PARENT ARE ENTITLED TO VOTE.

4.9          REPRESENTATIONS AND WARRANTIES OF BUYER.  THE REPRESENTATIONS AND
WARRANTIES OF BUYER CONTAINED HEREIN DO NOT CONTAIN ANY STATEMENT OF A MATERIAL
FACT THAT WAS UNTRUE WHEN MADE OR OMITS ANY INFORMATION NECESSARY TO MAKE ANY
SUCH STATEMENT CONTAINED THEREIN, IN LIGHT OF THE CIRCUMSTANCES UNDER WHICH SUCH
STATEMENT WAS MADE, NOT MISLEADING.  THE COPIES OF ALL DOCUMENTS FURNISHED BY
BUYER TO SELLER PURSUANT TO THE TERMS OF THIS AGREEMENT ARE COMPLETE AND
ACCURATE COPIES OF THE ORIGINAL DOCUMENTS.

ARTICLE V

OBLIGATIONS SURVIVING THE CLOSING

5.1          PAYMENT OF SECURED OBLIGATIONS AND TERMINATION OF LIENS AND
ENCUMBRANCES.  SELLER HEREBY COVENANTS THAT SELLER SHALL HAVE ARRANGED TO PAY,
PRIOR TO THE CLOSING DATE, ALL OF THE INDEBTEDNESS OR OTHER OBLIGATIONS LISTED
ON SCHEDULE 5.1 (THE “SECURED OBLIGATIONS”) OTHER THAN THE PERMITTED
ENCUMBRANCES AND FOR THE HOLDERS OF THE SECURED OBLIGATIONS TO DELIVER, IN
EXCHANGE FOR SUCH PAYMENT, (I) A FINANCING CHANGE STATEMENT ISSUED BY THE
ONTARIO PERSONAL PROPERTY REGISTRY EVIDENCING A DISCHARGE OF SUCH REGISTERED
SECURITY INTEREST OR SUCH OTHER INSTRUMENTS AND DOCUMENTS AS BUYER MAY
REASONABLY REQUEST TO EFFECTUATE THE REMOVAL AND TERMINATION OF ANY ENCUMBRANCES
AFFECTING ANY OF THE PURCHASED ASSETS AND EVIDENCE THE RELEASE BY SUCH HOLDERS
OF ANY CLAIMS THEY MAY HAVE AGAINST THE PURCHASED ASSETS OR THE BUSINESS, AND
(II) SUCH DOCUMENTS AS BUYER MAY REASONABLY REQUEST TO EVIDENCE THE PAYMENT OF
SUCH SECURED OBLIGATIONS.  IF IT IS DETERMINED AT ANY TIME HEREAFTER THAT SELLER
FAILED TO REMOVE OR CAUSE TO BE REMOVED, WITHOUT LIABILITY OR COST OR EXPENSE TO
BUYER AND WITHOUT THE DISPOSITION OR DIMINUTION IN THE VALUE OF ANY OF THE
PURCHASED ASSETS, ANY ENCUMBRANCE ON ANY OF THE PURCHASED ASSETS THAT WAS IN
EXISTENCE PRIOR TO THE EFFECTIVE TIME, OR IF ANY ENCUMBRANCE IS IMPOSED OR
PLACED ON ANY OF THE PURCHASED ASSETS (OR ANY REPLACEMENTS THEREOF) AFTER THE
CLOSING DATE AS A RESULT OF ANY ACT OR OMISSION OF SELLER, OCCURRING PRIOR TO
THE EFFECTIVE TIME, THEN, WITHOUT LIMITING ANY OTHER RIGHT OR REMEDY BUYER MAY
HAVE, SELLER SHALL CAUSE SUCH ENCUMBRANCE TO BE REMOVED AT NO EXPENSE OR
LIABILITY TO BUYER, AND WITHOUT ANY REDUCTION OR DISPOSITION OF ANY OF THE
PURCHASED ASSETS; PROVIDED, THAT IN THE FIRST INSTANCE BUYER SHALL NOTIFY SELLER
OF THE ENCUMBRANCE AND PROVIDE SELLER WITH AN OPPORTUNITY TO CAUSE SUCH
ENCUMBRANCE TO BE REMOVED.

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5.2          FURTHER ASSURANCES.  EACH PARTY HERETO SHALL EXECUTE AND DELIVER,
AFTER THE DATE HEREOF, SUCH ADDITIONAL DOCUMENTS OR INSTRUMENTS, AND SHALL TAKE
SUCH ADDITIONAL ACTIONS, AS THE OTHER PARTY MAY REASONABLY REQUEST IN ORDER TO
CARRY OUT THE INTENT OF THIS AGREEMENT OR TO BETTER EVIDENCE OR EFFECTUATE THE
TRANSACTIONS CONTEMPLATED HEREIN.

5.3          EXPENSES.  UNLESS OTHERWISE SPECIFICALLY PROVIDED FOR HEREIN, EACH
PARTY SHALL PAY ALL OF ITS RESPECTIVE COSTS AND EXPENSES INCURRED OR TO BE
INCURRED BY IT IN NEGOTIATING AND PREPARING THIS AGREEMENT AND THE OTHER
AGREEMENTS CONTEMPLATED HEREBY, AND IN CARRYING OUT AND CLOSING THE TRANSACTIONS
CONTEMPLATED BY THIS AGREEMENT WHETHER OR NOT THIS AGREEMENT OR THE TRANSACTIONS
CONTEMPLATED HEREBY ARE EVER CONSUMMATED.

5.4          TAXES.  SELLER SHALL PAY ALL TAXES OF ANY KIND OR NATURE ARISING
FROM (I) THE CONDUCT OR OPERATION OF ITS BUSINESS UP TO THE CLOSING DATE AND THE
CONDUCT OR OPERATION BY SELLER, PRIOR TO OR AFTER THE CLOSING DATE, OF ANY OTHER
BUSINESS OR BUSINESS ACTIVITIES OPERATIONS AND (II) ANY LIQUIDATION, PARTIAL OR
WHOLE, OF SELLER.  IF ANY TAXES REQUIRED UNDER THIS SECTION 5.4 TO BE BORNE BY
SELLER ARE ASSESSED AGAINST BUYER OR ANY OF THE PURCHASED ASSETS, BUYER SHALL
NOTIFY SELLER IN WRITING PROMPTLY THEREAFTER AND SELLER SHALL BE ENTITLED TO
CONTEST, IN GOOD FAITH, SUCH ASSESSMENT OR CHARGE SO LONG AS SUCH ASSESSMENT
DOES NOT CAUSE A MATERIAL ADVERSE EFFECT ON BUYER OR THE PURCHASED ASSETS OR
BUYER’S BUSINESS.  NOTWITHSTANDING THE FOREGOING, BUYER MAY (BUT SHALL NOT BE
OBLIGATED TO) PAY ANY SUCH TAXES ASSESSED AGAINST IT, ITS BUSINESS OR ANY OF THE
PURCHASED ASSETS, BUT WHICH ARE PAYABLE BY SELLER PURSUANT HERETO, IF BUYER’S
FAILURE TO DO SO, IN THE REASONABLE JUDGMENT OF BUYER, COULD RESULT IN THE
IMMEDIATE IMPOSITION OF AN ENCUMBRANCE ON ANY OF THE PURCHASED ASSETS OR ANY
OTHER ASSETS OF BUYER OR IF SELLER FAILS TO CONTEST SUCH ASSESSMENT OR CHARGE
DILIGENTLY AND IN GOOD FAITH.  IF IN ACCORDANCE WITH THE IMMEDIATELY PRECEDING
SENTENCE, BUYER PAYS ANY TAXES WHICH PURSUANT HERETO ARE REQUIRED TO BE BORNE BY
SELLER, BUYER SHALL BE ENTITLED TO REIMBURSEMENT THEREOF FROM SELLER IN
ACCORDANCE WITH THE INDEMNITY PROVISIONS SET FORTH IN ARTICLE X HEREOF.

5.5          REGISTRATION RIGHTS.

(A)           PIGGYBACK REGISTRATION.  IF AT ANY TIME FOLLOWING ISSUANCE OF THE
COMMON STOCK PURSUANT TO THIS AGREEMENT (SUCH SHARES OF THE COMMON STOCK, FOR
PURPOSES OF THIS SECTION 5.5 AND SECTION 5.6 ONLY, ARE COLLECTIVELY REFERRED TO
AS THE “REGISTRABLE SHARES”) BUYER SHALL DETERMINE TO REGISTER ANY OF ITS COMMON
STOCK UNDER THE SECURITIES ACT OTHER THAN PURSUANT TO (1) A REGISTRATION
RELATING SOLELY TO THE SALE OF SECURITIES TO PARTICIPANTS IN A BUYER EMPLOYEE
BENEFITS PLAN, (2) A REGISTRATION RELATING TO SECURITIES ISSUED IN CONNECTION
WITH AN ACQUISITION BY BUYER, OR (3) A REGISTRATION IN WHICH THE ONLY COMMON
STOCK BEING REGISTERED IS COMMON STOCK ISSUABLE UPON CONVERSION OF DEBT
SECURITIES WHICH ARE ALSO BEING REGISTERED, IT SHALL SEND TO SELLER (OR SELLER’S
APPOINTED REPRESENTATIVE, AS THE CASE MAY BE) WRITTEN NOTICE OF SUCH
DETERMINATION AND, IF WITHIN TWENTY (20) DAYS AFTER RECEIPT OF SUCH NOTICE,
SELLER SHALL SO REQUEST IN WRITING, BUYER SHALL USE ITS COMMERCIALLY REASONABLE
BEST EFFORTS TO INCLUDE IN SUCH REGISTRATION ALL OR ANY PART OF THE REGISTRABLE
SHARES THAT SELLER REQUESTS TO BE REGISTERED, PROVIDED, HOWEVER, THAT IF SUCH
REGISTRATION INVOLVES AN UNDERWRITTEN PUBLIC OFFERING AND THE MANAGING
UNDERWRITER REASONABLY DETERMINES THAT MARKETING FACTORS REQUIRE A LIMITATION ON
THE NUMBER OF SHARES THAT MAY BE INCLUDED IN THE REGISTRATION, THE NUMBER OF
SHARES TO BE INCLUDED IN SUCH REGISTRATION SHALL BE REDUCED AS FOLLOWS:  (I)
FIRST, THE COMMON STOCK HELD BY OFFICERS AND DIRECTORS OF BUYER SHALL BE RATABLY
EXCLUDED TO THE EXTENT REQUIRED BY SUCH LIMITATION,  (II) SECOND, THE
REGISTRABLE SHARES REQUESTED TO BE REGISTERED BY SELLER

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AND ALL OTHER SELLING STOCKHOLDERS WHO ACQUIRED REGISTRATION RIGHTS AFTER THE
DATE OF THIS AGREEMENT SHALL BE RATABLY EXCLUDED TO THE EXTENT REQUIRED BY SUCH
LIMITATION, AND (III) THIRD, THE COMMON STOCK REQUESTED TO BE REGISTERED BY
SELLING STOCKHOLDERS WITH REGISTRATION RIGHTS OTHER THAN UNDER THIS AGREEMENT
AND GRANTED BEFORE THE DATE HEREOF SHALL BE EXCLUDED TO THE EXTENT REQUIRED BY
SUCH LIMITATION.  IF SELLER DISAPPROVES OF THE TERMS OF SUCH UNDERWRITING, HE
MAY ELECT TO WITHDRAW THEREFROM BY WRITTEN NOTICE TO BUYER AND THE UNDERWRITER.

(B)           SELLER INFORMATION.  SELLER COVENANTS AND AGREES THAT IT SHALL
PROVIDE TO BUYER ON A TIMELY BASIS SUCH CONSENTS, REPRESENTATIONS AND
INFORMATION AS MAY REASONABLY BE REQUIRED BY BUYER IN CONNECTION WITH THE
PREPARATION AND FILING OF A REGISTRATION STATEMENT OR RELATED PROSPECTUS OR ANY
AMENDMENT OR SUPPLEMENT THERETO.

(C)           EXPENSES.  BUYER SHALL PAY ALL EXPENSES OF REGISTRATION OF ANY
SHARES OF THE COMMON STOCK PURSUANT TO SECTION 5.5(A), EXCEPT BROKERAGE
COMMISSIONS, LEGAL FEES AND EXPENSES, AND SUCH OTHER FEES AND EXPENSES AS MAY BE
INCURRED BY SELLER, WHICH COMMISSIONS AND EXPENSES SHALL BE PAID BY THE SELLER.

(D)           NOTIFICATION.  BUYER WILL PROMPTLY NOTIFY SELLER UPON THE
OCCURRENCE OF ANY OF THE FOLLOWING EVENTS IN RESPECT OF A REGISTRATION STATEMENT
OR RELATED PROSPECTUS: (I) RECEIPT OF ANY REQUEST FOR ADDITIONAL INFORMATION BY
THE SEC OR ANY OTHER FEDERAL OR STATE GOVERNMENTAL AUTHORITY DURING THE PERIOD
OF EFFECTIVENESS OF THE REGISTRATION STATEMENT OR AMENDMENTS OR SUPPLEMENTS TO
THE REGISTRATION STATEMENT OR ANY RELATED PROSPECTUS; (II) THE ISSUANCE BY THE
SEC OR ANY OTHER FEDERAL OR STATE GOVERNMENTAL AUTHORITY OF ANY STOP ORDER
SUSPENDING THE EFFECTIVENESS OF THE REGISTRATION STATEMENT OR THE INITIATION OF
ANY PROCEEDINGS FOR THAT PURPOSE; (III) RECEIPT OF ANY NOTIFICATION WITH RESPECT
TO THE SUSPENSION OF THE QUALIFICATION OR EXEMPTION FROM QUALIFICATION OF THE
REGISTRABLE SHARES REGISTERED PURSUANT TO SECTION 5.5(A) FOR SALE IN ANY
JURISDICTION OR THE INITIATION OF ANY PROCEEDING FOR SUCH PURPOSE; (IV) THE
HAPPENING OF ANY EVENT THAT MAKES ANY STATEMENT MADE IN THE REGISTRATION
STATEMENT, OR RELATED PROSPECTUS, OR ANY DOCUMENT INCORPORATED OR DEEMED TO BE
INCORPORATED THEREIN BY REFERENCE, UNTRUE IN ANY MATERIAL RESPECT OR THAT
REQUIRES THE MAKING OF ANY CHANGES IN THE REGISTRATION STATEMENT, RELATED
PROSPECTUS, OR OTHER DOCUMENTS SO THAT, IN THE CASE OF THE REGISTRATION
STATEMENT, IT WILL NOT CONTAIN ANY UNTRUE STATEMENT OF A MATERIAL FACT OR OMIT
TO STATE ANY MATERIAL FACT REQUIRED TO BE STATED THEREIN OR NECESSARY TO MAKE
THE STATEMENTS THEREIN NOT MISLEADING, AND THAT IN THE CASE OF THE RELATED
PROSPECTUS, IT WILL NOT CONTAIN ANY UNTRUE STATEMENT OF A MATERIAL FACT OR OMIT
TO STATE ANY MATERIAL FACT REQUIRED TO BE STATED THEREIN OR NECESSARY TO MAKE
THE STATEMENTS THEREIN, IN THE LIGHT OF THE CIRCUMSTANCES UNDER WHICH THEY WERE
MADE, NOT MISLEADING.

(E)           ASSIGNMENT OF REGISTRATION RIGHTS.  THE RIGHTS SET FORTH IN THIS
SECTION 5.5, MAY BE ASSIGNED BY SELLER TO TRANSFEREES OR ASSIGNEES OF ALL OR ANY
PORTION OF THE REGISTRABLE SHARES, BUT ONLY IF (A) SELLER AGREES IN WRITING WITH
THE TRANSFEREE OR ASSIGNEE TO ASSIGN SUCH RIGHTS, AND A COPY OF SUCH AGREEMENT
IS FURNISHED TO BUYER WITHIN A REASONABLE TIME AFTER SUCH ASSIGNMENT, (B) BUYER
IS, WITHIN A REASONABLE TIME AFTER SUCH TRANSFER OR ASSIGNMENT, FURNISHED WITH
WRITTEN NOTICE OF THE NAME AND ADDRESS OF SUCH TRANSFEREE OR ASSIGNEE AND THE
SECURITIES WITH RESPECT TO WHICH SUCH REGISTRATION RIGHTS ARE BEING TRANSFERRED
OR ASSIGNED, (C) AFTER SUCH TRANSFER OR ASSIGNMENT, THE FURTHER DISPOSITION OF
SUCH SECURITIES BY THE TRANSFEREE OR ASSIGNEE IS RESTRICTED UNDER THE SECURITIES
ACT AND APPLICABLE STATE SECURITIES LAWS, AND (D) AT OR BEFORE THE TIME BUYER
RECEIVED THE WRITTEN NOTICE CONTEMPLATED BY CLAUSE (B) OF THIS SENTENCE, THE
TRANSFEREE OR ASSIGNEE AGREES IN WRITING WITH BUYER TO BE BOUND BY ALL OF THE
PROVISIONS CONTAINED HEREIN.

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(F)            ADDITIONAL REQUIREMENTS.  UNTIL TERMINATION OF THE REGISTRATION
STATEMENT, BUYER WILL USE ALL COMMERCIALLY REASONABLE EFFORTS TO MAKE AND KEEP
CURRENT PUBLIC INFORMATION AVAILABLE, AS THOSE TERMS ARE UNDERSTOOD AND DEFINED
IN RULE 144, AND FILE ON A TIMELY BASIS WITH THE SEC ALL INFORMATION THAT IT MAY
BE REQUIRED TO FILE UNDER EITHER SECTION 13 OR SECTION 15(D) OF THE EXCHANGE
ACT, AND, SO LONG AS IT IS REQUIRED TO FILE SUCH INFORMATION (WITHOUT REGARD TO
THE EFFECTIVENESS OF ANY REGISTRATION STATEMENT), USE ALL COMMERCIALLY
REASONABLE EFFORTS TO MAINTAIN THE AVAILABILITY OF RULE 144 (OR ANY SUCCESSOR
EXEMPTIVE RULE HEREINAFTER IN EFFECT) WITH RESPECT TO SHARES OF THE COMMON STOCK
AND TO COOPERATE WITH ANY HOLDER OF COMMON STOCK WHO DESIRES TO MAKE A SALE
UNDER RULE 144.

(G)           TERMINATION.  THE REGISTRATION RIGHTS OF SELLER UNDER
SECTION 5.5(A) SHALL TERMINATE ON SUCH DATE AS THE REGISTRABLE SHARES ARE
OTHERWISE SALEABLE UNDER RULE 144 WITHOUT LIMITATIONS ON VOLUME DURING ANY
NINETY (90) DAY PERIOD.

5.6          MARKET STAND OFF AGREEMENT.  THE SELLER AND THE PRINCIPAL OWNERS
AGREE THAT, IF REQUESTED BY THE MANAGING UNDERWRITER OF A REGISTRATION OF THE
REGISTRABLE SHARES IN ACCORDANCE WITH SECTION 5.5 ABOVE, THEY WILL NOT, WITHOUT
PRIOR WRITTEN CONSENT OF SUCH UNDERWRITER, SELL OR OTHERWISE TRANSFER OR DISPOSE
OF ANY OF THEIR RESPECTIVE REGISTRABLE SHARES (OTHER THAN TO DONEES WHO AGREE TO
BE SIMILARLY BOUND), AND, IN THE CASE OF SELLER, WILL USE COMMERCIALLY
REASONABLE BEST EFFORTS TO PREVENT ANY OF ITS OFFICERS, DIRECTORS, EMPLOYEES,
CONSULTANTS, OR AFFILIATES WHO HOLD REGISTRABLE SHARES FROM SELLING OR OTHERWISE
TRANSFERRING OR DISPOSING OF ANY OF THEIR RESPECTIVE REGISTRABLE SHARES, DURING
SUCH PERIOD OF TIME, NOT TO EXCEED NINETY (90) DAYS FOLLOWING THE EFFECTIVE DATE
OF THE REGISTRATION STATEMENT FILED BY BUYER WITH RESPECT TO SUCH REGISTRATION
OF REGISTRABLE SHARES.

5.7          EMPLOYMENT OF SELLER’S EMPLOYEES.  BUYER COVENANTS THAT IT SHALL,
CONDITIONAL ON CLOSING, AND PRIOR TO THE CLOSING DATE, EXTEND OFFERS OF
EMPLOYMENT SUBSTANTIALLY IN THE FORM OF THE OFFER ATTACHED HERETO AS
SCHEDULE 5.7 “A” TO ALL OF THE CURRENT EMPLOYEES OF THE BUSINESS LISTED ON
SCHEDULE 3.19 ON TERMS AND CONDITIONS IN THE AGGREGATE NO LESS FAVOURABLE THAN
THOSE ON WHICH THEY WERE EMPLOYED BY SELLER AND HONOUR THEIR YEARS OF SERVICE
AND SENIORITY FOR ALL PURPOSES TO THE EXTENT PERMITTED UNDER APPLICABLE EMPLOYEE
BENEFIT PLANS.  SCHEDULE 5.7 “B” SETS OUT THE BASE SALARY THAT WILL BE PAYABLE
BY BUYER TO THOSE EMPLOYEES THAT ACCEPT THE BUYER’S OFFER OF EMPLOYMENT.  THE
SELLER SHALL CO-OPERATE WITH THE BUYER IN ITS EFFORTS TO ENSURE THAT EACH
EMPLOYEE ACCEPT OFFERS OF EMPLOYMENT; PROVIDED THAT IN PROVIDING SUCH
COOPERATION, SELLER SHALL NOT BE REQUIRED TO EXPEND FUNDS OR INCUR ANY
OBLIGATIONS OR LIABILITIES IN CONNECTION THEREWITH.  IN RESPECT OF THE PERIOD
DURING WHICH THE EMPLOYEES ARE CONSIDERING BUYER’S OFFER OF EMPLOYMENT
HEREUNDER, AS BETWEEN BUYER AND SELLER, BUYER SHALL BE RESPONSIBLE FOR (I) THE
REMUNERATION PAYABLE TO EACH EMPLOYEE IN RESPECT OF THE PERIOD COMMENCING AT THE
EFFECTIVE TIME AND ENDING AT THE TIME SUCH EMPLOYEE ACCEPTS OR REJECTS, AS THE
CASE MAY BE, BUYER’S OFFER OF EMPLOYMENT, AND (II) THE OBLIGATIONS AND
LIABILITIES OF AN EMPLOYER OF SUCH EMPLOYEES; PROVIDED THAT FOR GREATER
CERTAINTY, THE BUYER SHALL NOT BE RESPONSIBLE FOR AND IS NOT ASSUMING HEREUNDER
ANY OBLIGATION OR LIABILITY OWED TO ANY EMPLOYEE THAT REJECTS BUYER’S OFFER OF
EMPLOYMENT HEREUNDER FOR TERMINATION PAY, SEVERANCE PAY OR DAMAGES IN LIEU OF
NOTICE OF TERMINATION, WHICH SHALL BE CONSIDERED A RETAINED LIABILITY HEREUNDER.

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ARTICLE VI

SURVIVAL OF REPRESENTATIONS AND WARRANTIES

All of the respective representations and warranties of Seller and Buyer set
forth in this Agreement or in any of such party’s disclosure schedules, or in
any certificates delivered by such party on the Closing Date shall survive the
consummation of the transactions contemplated hereby for eighteen (18) months. 
The covenants of any party hereto that cannot be or are not fully performed by
such party on or prior to the Closing Date shall survive until they are
otherwise terminated pursuant to their terms or fully performed.

ARTICLE VII

CONDITIONS PRECEDENT TO THE OBLIGATIONS OF BUYER

The obligation of Buyer to consummate the purchase of the Purchased Assets from
Seller is subject to the fulfillment, or the waiver by Buyer, at or prior to the
Closing, of each of the following conditions precedent:

7.1          ABSENCE OF MATERIAL LITIGATION.  EXCEPT AS SET FORTH ON
SCHEDULE 3.14, THERE SHALL BE (A) NO PENDING OR OVERTLY THREATENED LITIGATION
(OTHER THAN LITIGATION WHICH IS DETERMINED BY THE PARTIES IN GOOD FAITH, AFTER
CONSULTING THEIR RESPECTIVE ATTORNEYS, TO BE WITHOUT LEGAL OR FACTUAL SUBSTANCE
OR MERIT), WHETHER BROUGHT AGAINST SELLER OR BUYER, THAT SEEKS TO ENJOIN THE
CONSUMMATION OF ANY OF THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT, (B) NO
ORDER THAT HAS BEEN ISSUED BY ANY COURT OR GOVERNMENTAL AGENCY HAVING
JURISDICTION THAT RESTRAINS OR PROHIBITS THE CONSUMMATION OF THE PURCHASE AND
SALE OF THE PURCHASED ASSETS HEREUNDER AND NO PROCEEDINGS PENDING WHICH ARE
REASONABLY LIKELY TO RESULT IN THE ISSUANCE OF SUCH AN ORDER; AND (C) NO PENDING
OR OVERTLY THREATENED LITIGATION, WHICH HAS HAD OR IS REASONABLY EXPECTED TO
HAVE A MATERIAL ADVERSE EFFECT ON SELLER.

7.2          PERFORMANCE OF OBLIGATIONS.  SELLER SHALL HAVE PERFORMED AND
COMPLIED, IN ALL MATERIAL RESPECTS WITH ALL OF THE COVENANTS REQUIRED BY THIS
AGREEMENT TO HAVE BEEN PERFORMED PRIOR TO THE CLOSING.

7.3          NO MATERIAL ADVERSE CHANGE.  SINCE THE DATE OF THIS AGREEMENT,
THERE SHALL NOT HAVE BEEN ANY CHANGE IN OR OTHER EVENT THAT HAS HAD OR IS
REASONABLY EXPECTED TO HAVE A MATERIAL ADVERSE EFFECT ON SELLER.

7.4          DELIVERY OF ADDITIONAL INSTRUMENTS.  ON THE CLOSING DATE, SELLER
SHALL DELIVER, OR CAUSE TO BE DELIVERED TO BUYER, THE FOLLOWING DOCUMENTS AND
INSTRUMENTS, IN FORM AND SUBSTANCE SATISFACTORY TO BUYER AND ITS COUNSEL, UNLESS
WAIVED IN WRITING BY BUYER:

(A)           THE BILL OF SALE AND ASSUMPTION AGREEMENT IN SUBSTANTIALLY THE
FORM OF EXHIBIT B HERETO, DULY EXECUTED BY SELLER (THE “BILL OF SALE”);

(B)           EVIDENCE OF THE RECEIPT OF ALL THIRD PARTY CONSENTS DESCRIBED ON
SCHEDULE 3.1 OR OTHERWISE REFERRED TO IN SECTION 3.1 IN CONNECTION WITH THE
CONSUMMATION OF THE TRANSACTIONS CONTEMPLATED HEREIN;

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(C)           A LEGAL OPINION OF COUNSEL TO SELLER IN SUCH FORM AS IS REASONABLY
SATISFACTORY TO BUYER;

(D)           A CERTIFICATE OF STATUS, DATED AS OF A DATE THAT IS NOT MORE THAN
TEN (10) DAYS PRIOR TO THE CLOSING DATE, FROM THE MINISTRY OF CONSUMER AND
BUSINESS AFFAIRS OF THE PROVINCE OF ONTARIO, FOR SELLER; AND

(E)           SUCH OTHER DOCUMENTS AND INSTRUMENTS AS BUYER OR BUYER’S COUNSEL
MAY REASONABLY REQUEST SO AS BETTER TO EVIDENCE OR EFFECTUATE THE TRANSACTIONS
CONTEMPLATED HEREBY.

7.5          EMPLOYMENT AGREEMENTS FOR KEY EMPLOYEES.  BUYER SHALL HAVE ENTERED
INTO AGREEMENTS FOR EMPLOYMENT WITH EACH OF THE EMPLOYEES OF SELLER (THE
“EMPLOYMENT AGREEMENTS”) AS SET FORTH IN SECTION 5.7 HEREOF.

7.6          SHAREHOLDER APPROVAL.  THIS AGREEMENT, AND THE TRANSACTIONS
CONTEMPLATED HEREBY, SHALL HAVE BEEN DULY APPROVED BY SPECIAL RESOLUTION (AS
PROVIDED FOR UNDER THE BUSINESS CORPORATIONS ACT (ONTARIO)) OF THE SHAREHOLDERS
OF SELLER.

ARTICLE VIII

CONDITIONS PRECEDENT TO OBLIGATIONS OF SELLER

The obligation of Seller to consummate the sale of the Purchased Assets to Buyer
is subject to the fulfillment, or the waiver by Seller, at or prior to the
Closing, of each of the following conditions precedent:

8.1          ABSENCE OF MATERIAL LITIGATION.  THERE SHALL BE (A) NO PENDING OR
OVERTLY THREATENED LITIGATION (OTHER THAN LITIGATION WHICH IS DETERMINED BY THE
PARTIES IN GOOD FAITH, AFTER CONSULTING THEIR RESPECTIVE ATTORNEYS, TO BE
WITHOUT LEGAL OR FACTUAL SUBSTANCE OR MERIT), WHETHER BROUGHT AGAINST SELLER OR
BUYER THAT SEEKS TO ENJOIN THE CONSUMMATION OF ANY OF THE TRANSACTIONS
CONTEMPLATED BY THIS AGREEMENT, (B) NO ORDER THAT HAS BEEN ISSUED BY ANY COURT
OR GOVERNMENTAL AGENCY HAVING JURISDICTION THAT RESTRAINS OR PROHIBITS THE
CONSUMMATION OF THE PURCHASE AND SALE OF THE PURCHASED ASSETS HEREUNDER AND NO
PROCEEDINGS PENDING WHICH ARE REASONABLY LIKELY TO RESULT IN THE ISSUANCE OF
SUCH AN ORDER, AND (C) NO PENDING OR OVERTLY THREATENED LITIGATION WHICH HAS HAD
OR IS REASONABLY EXPECTED TO HAVE A MATERIAL ADVERSE EFFECT ON BUYER.

8.2          PERFORMANCE OF OBLIGATIONS.  BUYER SHALL HAVE PERFORMED AND
COMPLIED IN ALL MATERIAL RESPECTS WITH ALL OF ITS COVENANTS REQUIRED BY THIS
AGREEMENT TO HAVE BEEN PERFORMED BY IT AT OR PRIOR TO THE CLOSING.

8.3          NO MATERIAL ADVERSE CHANGE.  SINCE THE DATE OF THIS AGREEMENT,
THERE SHALL NOT HAVE BEEN ANY CHANGE IN OR OTHER EVENT THAT HAS HAD OR IS
REASONABLY EXPECTED TO HAVE A MATERIAL ADVERSE EFFECT ON BUYER.

8.4          DELIVERY OF ADDITIONAL INSTRUMENTS.  ON THE CLOSING DATE, BUYER
SHALL DELIVER, OR CAUSE TO BE DELIVERED TO SELLER, THE FOLLOWING DOCUMENTS AND
INSTRUMENTS, IN FORM AND SUBSTANCE SATISFACTORY TO SELLER AND ITS COUNSEL,
UNLESS WAIVED IN WRITING BY SELLER:

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(A)           THE BILL OF SALE DULY EXECUTED BY BUYER;

(B)           LEGAL OPINIONS OF COUNSELS TO PARENT AND BUYER IN SUCH FORMS AS
ARE REASONABLY SATISFACTORY TO SELLER;

(C)           A GOOD STANDING CERTIFICATE, DATED AS OF A DATE THAT IS NOT MORE
THAN TEN (10) DAYS PRIOR TO THE CLOSING DATE, FROM THE SECRETARY OF STATE OF
DELAWARE, FOR THE PARENT;

(D)           A CERTIFICATE OF STATUS DATED AS OF A DATE THAT IS NOT MORE THAN
TEN (10) DAYS PRIOR TO THE CLOSING DATE, FROM THE MINISTRY OF CONSUMER AND
BUSINESS AFFAIRS OF THE PROVINCE OF ONTARIO; AND

(E)           SUCH OTHER DOCUMENTS AND INSTRUMENTS AS SELLER OR SELLER’S COUNSEL
MAY REASONABLY REQUEST SO AS BETTER TO EVIDENCE OR EFFECTUATE THE TRANSACTIONS
CONTEMPLATED HEREBY.

8.5          DELIVERY OF CONSIDERATION.  AT THE CLOSING, BUYER SHALL DELIVER TO
SELLER A CASH PAYMENT IN THE AMOUNT SET FORTH IN SECTION 2.2(A) HEREOF, WIRED TO
AN ACCOUNT DESIGNATED BY SELLER, AND PARENT SHALL ISSUE AN IRREVOCABLE
INSTRUCTION LETTER TO ITS TRANSFER AGENT AUTHORIZING THE TRANSFER AGENT TO ISSUE
SHARES OF COMMON STOCK TO SELLER AS SET FORTH IN SECTION 2.2(B) HEREOF.

8.6          EMPLOYMENT AGREEMENTS FOR KEY EMPLOYEES.  BUYER SHALL HAVE ENTERED
INTO THE EMPLOYMENT AGREEMENTS AS SET FORTH IN SECTION 5.7 HEREOF.

8.7          RESERVATION OF STOCK OPTIONS.  ON THE CLOSING DATE, BUYER SHALL
HAVE RESERVED FOR ISSUANCE AND GRANTED TO EMPLOYEES OF BUYER WHO WERE FORMERLY
EMPLOYEES OF SELLER, AN AGGREGATE OF THREE HUNDRED THOUSAND (300,000) OPTIONS
(THE “OPTIONS”) TO PURCHASE SHARES OF COMMON STOCK FROM PARENT’S STOCK OPTION
PLAN (THE “STOCK OPTION PLAN”).  THE COMMON STOCK ISSUABLE UPON EXERCISE OF THE
OPTIONS SHALL BE SHARES OF THE COMMON STOCK OF PARENT WHICH ARE THE SAME AS
THOSE SHARES OF PARENT QUOTED FOR TRADING ON THE OTC ON THE CLOSING DATE.  THE
EXERCISE PRICE OF THE OPTIONS SHALL BE THE PRICE AT WHICH THE LAST TRADE WAS
MADE IN THE COMMON STOCK OF PARENT AS QUOTED ON THE OTC ON THE LAST DAY THE OTC
WAS OPEN FOR TRADING IMMEDIATELY PRECEDING THE CLOSING DATE.  THE OPTIONS SHALL
VEST ANNUALLY SUBSEQUENT TO THE CLOSING DATE AT A RATE OF 33 1/3% PER ANNUM, ALL
AS SET FORTH ON SCHEDULE 8.7.  BUYER SHALL GRANT AND ALLOCATE THE OPTIONS TO THE
PERSONS AND IN THE AMOUNTS SET FORTH ON SCHEDULE 8.7 HERETO.  IN THE EVENT, A
PERSON LISTED ON SCHEDULE 8.7 IS NO LONGER EMPLOYED BY BUYER, OR AN AFFILIATE OF
BUYER, ON THE DATE THAT ANY OF THE OPTIONS ARE SCHEDULED TO VEST, BUYER SHALL
CANCEL SUCH PREVIOUS GRANT OF THE OPTIONS TO SUCH FORMER EMPLOYEE AND SHALL
REALLOCATE SUCH OPTIONS ON A PRO RATA BASIS AMONG THE REMAINING PERSONS LISTED
ON SCHEDULE 8.7.  BUYER SHALL DELIVER EVIDENCE OF SUCH GRANTS TO SELLER AT THE
CLOSING.

8.8          Payment of Secured Obligations.  On the Closing Date, the Buyer
shall pay the full amount of the Secured Obligations, the final payments for
which shall be determined by the delivery of pay off letters to Buyer not later
than the day before the Closing Date.  The total amount to be paid by the Buyer
for the Secured Obligations pursuant to this Section 8.8 is $657,582.65.

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ARTICLE IX

THE CLOSING

The consummation of the transactions contemplated hereby (the “Closing”) shall
take place on the first business day following the satisfaction or waiver of the
closing conditions set forth in Article VII and Article VIII above (the “Closing
Date”) at the offices of Stradling Yocca Carlson & Rauth or at such other date
and place as the parties may agree and shall be deemed to occur at 12:00 p.m.,
California time (the “Effective Time”), on such date; provided, however, that
the Closing shall occur on or prior to October 30, 2006.

9.1          CLOSING DELIVERIES OF SELLER.  AT THE CLOSING, SELLER SHALL
DELIVER, OR CAUSE TO BE DELIVERED TO BUYER, THE DOCUMENTS AND INSTRUMENTS SET
FORTH IN ARTICLE VII ABOVE, IN FORM AND SUBSTANCE REASONABLY SATISFACTORY TO
BUYER AND ITS COUNSEL.

9.2          CLOSING DELIVERIES OF BUYER.  AT THE CLOSING, BUYER SHALL DELIVER,
OR CAUSE TO BE DELIVERED, THE PURCHASE PRICE TO SELLER AND THE DOCUMENTS AND
INSTRUMENTS SET FORTH IN ARTICLE VIII ABOVE, IN FORM AND SUBSTANCE REASONABLY
SATISFACTORY TO SELLER AND ITS COUNSEL.

ARTICLE X

INDEMNIFICATION

10.1        OBLIGATIONS OF SELLER.  SELLER AND THE PRINCIPAL OWNERS HEREBY
AGREE, JOINTLY AND SEVERALLY, THAT THEY WILL INDEMNIFY, HOLD HARMLESS AND DEFEND
BUYER AND EACH OF ITS DIRECTORS, OFFICERS, MEMBERS, EMPLOYEES AND AGENTS AND THE
RESPECTIVE SUCCESSORS AND ASSIGNS OF BUYER AND SUCH PERSONS (ALL OF THE
FOREGOING, COLLECTIVELY, THE “INDEMNIFIED PARTIES” OR, INDIVIDUALLY, AN
“INDEMNIFIED PARTY”), FROM AND AGAINST ANY AND ALL LOSSES THAT ARISE FROM OR ARE
IN CONNECTION WITH:

(A)           ANY BREACH OF OR INACCURACY IN ANY OF THE REPRESENTATIONS OR
WARRANTIES OF SELLER CONTAINED IN THIS AGREEMENT OR IN SELLER’S DISCLOSURE
SCHEDULES OR OTHER DOCUMENTS CONTEMPLATED HEREBY;

(B)           ANY BREACH OR DEFAULT BY SELLER OR THE PRINCIPAL OWNERS OF ANY OF
THE COVENANTS OR AGREEMENTS CONTAINED IN THIS AGREEMENT;

(C)           THE FAILURE BY SELLER OR THE PRINCIPAL OWNERS TO DISCHARGE WHEN
DUE ANY OF THE RETAINED LIABILITIES;

(D)           THE FAILURE TO HAVE PAID OR TO PAY, WHEN DUE, ANY TAXES THAT AROSE
OUT OF THE OPERATIONS OF SELLER OR THE CONSUMMATION OF THE TRANSACTIONS
CONTEMPLATED BY THIS AGREEMENT OR THE FAILURE TO HAVE FILED, WHEN DUE, ANY TAX
RETURNS RELATED TO ANY SUCH TAXES OR ANY PERIOD UP TO THE CLOSING DATE, WHETHER
OR NOT SUCH FAILURE CONSTITUTES A BREACH OF THE REPRESENTATIONS OR WARRANTIES OF
SELLER CONTAINED IN SECTION 3.13 OR IS DISCLOSED IN THIS AGREEMENT OR SELLER’S
DISCLOSURE SCHEDULES; AND

(E)           THE FAILURE TO COMPLY WITH THE BULK SALES ACT (ONTARIO).

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10.2        LIMITATIONS ON OBLIGATIONS OF SELLER.  IN NO EVENT SHALL SELLER OR
THE PRINCIPAL OWNERS HAVE ANY OBLIGATION TO INDEMNIFY THE INDEMNIFIED PARTIES
FOR OR IN RESPECT OF ANY OF THE ASSUMED OBLIGATIONS IDENTIFIED ON SCHEDULE 1.3,
AND BUYER AGREES TO INDEMNIFY, HOLD HARMLESS AND DEFEND SELLER AND THE PRINCIPAL
OWNERS (IN THE SAME MANNER AND ON THE SAME TERMS AND CONDITIONS THAT ARE
APPLICABLE TO SELLER AND THE PRINCIPAL OWNERS’ INDEMNIFICATION OBLIGATIONS UNDER
THIS ARTICLE X), FROM AND AGAINST ANY AND ALL LOSSES, INCURRED BY SELLER OR THE
PRINCIPAL OWNERS AS A RESULT OF (A) ANY FAILURE BY BUYER TO PAY OR OTHERWISE
DISCHARGE, OR FROM ANY FAILURE BY BUYER TO COMPLY WITH THE PROVISIONS OF, ANY OF
THE ASSUMED OBLIGATIONS AFTER THE CLOSING DATE, OR (B) ANY BREACH OR DEFAULT BY
BUYER OF ANY OF ITS COVENANTS OR AGREEMENTS, OR ANY REPRESENTATIONS OR WARRANTY
HEREUNDER (IN WHICH CASE THE PROVISIONS OF THIS ARTICLE X SHALL APPLY MUTATIS
MUTANDIS).

No Indemnified Party shall be entitled to any indemnification under this
Article X with respect to any particular representation or warranty unless it
gives notice to the Indemnifying Party with respect to the claim for
indemnification at a time during which the particular representation or warranty
with respect to the claim is made survives pursuant to Article VI.

10.3        CLAIMS PROCEDURE.  PROMPTLY AFTER THE RECEIPT BY ANY INDEMNIFIED
PARTY OF NOTICE OF THE COMMENCEMENT OF ANY ACTION OR PROCEEDING AGAINST SUCH
INDEMNIFIED PARTY, SUCH INDEMNIFIED PARTY SHALL, IF A CLAIM WITH RESPECT THERETO
IS OR MAY BE MADE AGAINST ANY INDEMNIFYING PARTY (THE “INDEMNIFYING PARTY”)
PURSUANT TO THIS ARTICLE X, GIVE SUCH INDEMNIFYING PARTY WRITTEN NOTICE OF THE
COMMENCEMENT OF SUCH ACTION OR PROCEEDING AND GIVE SUCH INDEMNIFYING PARTY A
COPY OF SUCH CLAIM AND/OR PROCESS AND ALL LEGAL PLEADINGS IN CONNECTION
THEREWITH.  THE FAILURE TO GIVE SUCH NOTICE SHALL NOT RELIEVE ANY INDEMNIFYING
PARTY OF ANY OF ITS INDEMNIFICATION OBLIGATIONS CONTAINED IN THIS ARTICLE X,
EXCEPT WHERE, AND SOLELY TO THE EXTENT THAT, SUCH FAILURE ADVERSELY AFFECTS OR
PREJUDICES THE RIGHTS OF SUCH INDEMNIFYING PARTY.  SUCH INDEMNIFYING PARTY SHALL
HAVE THE RIGHT TO DEFEND, AT HIS OR ITS OWN EXPENSE AND BY HIS OR ITS OWN
COUNSEL REASONABLY ACCEPTABLE TO THE INDEMNIFIED PARTY, ANY SUCH MATTER
INVOLVING THE ASSERTED LIABILITY OF THE INDEMNIFIED PARTY; PROVIDED, HOWEVER,
THAT THE INDEMNIFIED PARTY SHALL HAVE THE RIGHT TO PARTICIPATE IN THE DEFENSE OR
SUCH ASSERTED LIABILITY AT THE INDEMNIFIED PARTY’S OWN EXPENSE.  IN ANY EVENT,
THE INDEMNIFIED PARTY, SUCH INDEMNIFYING PARTY AND ITS COUNSEL SHALL COOPERATE
IN THE DEFENSE AGAINST, OR COMPROMISE OF, ANY SUCH ASSERTED LIABILITY, AND IN
CASES WHERE THE INDEMNIFYING PARTY SHALL HAVE ASSUMED THE DEFENSE, THE
INDEMNIFIED PARTY SHALL HAVE THE RIGHT TO PARTICIPATE IN THE DEFENSE OF SUCH
ASSERTED LIABILITY AT THE INDEMNIFIED PARTY’S OWN EXPENSE.  IN THE EVENT THAT
SUCH INDEMNIFYING PARTY SHALL DECLINE TO PARTICIPATE IN OR ASSUME THE DEFENSE OF
SUCH ACTION, IN ACCORDANCE WITH THE PROVISIONS HEREOF, OR IF THE INDEMNIFYING
PARTY DISCONTINUES THE DILIGENT AND TIMELY CONDUCT THEREOF, ANY OF THE
INDEMNIFIED PARTIES MAY UNDERTAKE SUCH DEFENSE AND THE INDEMNIFYING PARTY SHALL
BE RESPONSIBLE FOR REIMBURSING THE INDEMNIFIED PARTIES FOR THEIR REASONABLE
LEGAL FEES AND EXPENSES IN CONNECTION THEREWITH AS AND WHEN SUCH FEES AND
EXPENSES ARE INCURRED BY THEM.  IF THE INDEMNIFYING PARTY IS DEFENDING THE CLAIM
AS SET FORTH ABOVE, THE INDEMNIFYING PARTY SHALL HAVE THE SOLE RIGHT TO SETTLE
THE CLAIM, SUBJECT TO OBTAINING THE CONSENT OF THE INDEMNIFIED PARTY, WHICH
CONSENT WILL NOT UNREASONABLY BE WITHHELD OR DELAYED; PROVIDED, HOWEVER, THAT IF
THE INDEMNIFIED PARTY SHALL FAIL TO CONSENT TO THE SETTLEMENT OF SUCH A CLAIM BY
THE INDEMNIFYING PARTY, WHICH SETTLEMENT (I) THE CLAIMANT HAS INDICATED IT WILL
ACCEPT, AND (II) INCLUDES AN UNCONDITIONAL RELEASE OF THE INDEMNIFIED PARTY BY
THE CLAIMANT AND IMPOSES NO RESTRICTIONS ON THE FUTURE ACTIVITIES OF THE
INDEMNIFIED PARTY AND ITS AFFILIATES, THE INDEMNIFYING PARTY SHALL HAVE NO
LIABILITY WITH RESPECT TO ANY PAYMENT REQUIRED TO BE MADE TO SUCH CLAIMANT IN
RESPECT OF SUCH CLAIM.  IF THE INDEMNIFIED PARTY IS DEFENDING THE CLAIM AS SET
FORTH ABOVE, THE INDEMNIFIED PARTY SHALL HAVE

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THE RIGHT TO SETTLE OR COMPROMISE ANY CLAIM AGAINST IT AFTER CONSULTATION WITH,
BUT WITHOUT THE NECESSITY OF OBTAINING THE PRIOR APPROVAL OF, ANY INDEMNIFYING
PARTY, PROVIDED, HOWEVER, THAT SUCH SETTLEMENT OR COMPROMISE SHALL NOT, UNLESS
CONSENTED TO IN WRITING BY SUCH INDEMNIFYING PARTY, WHICH CONSENT SHALL NOT BE
UNREASONABLY WITHHELD, BE CONCLUSIVE AS TO THE LIABILITY OF SUCH INDEMNIFYING
PARTY TO THE INDEMNIFIED PARTY.

10.4        LIMITATIONS ON LIABILITY.  NO INDEMNIFICATION FOR BREACHES OF
REPRESENTATIONS, WARRANTIES AND COVENANTS FOR ALL CLAIMS UNDER SECTION 10.1(A)
AND (B) SHALL BE MADE UNLESS THE AGGREGATE AMOUNT OF LOSSES INCURRED BY THE
INDEMNIFIED PARTY EXCEEDS TEN THOUSAND DOLLARS ($10,000); PROVIDED, HOWEVER,
THAT IN THE EVENT THE LOSSES EXCEED SUCH AMOUNT, INDEMNIFICATION SHALL BE MADE
WITH RESPECT TO ALL LOSSES, AND PROVIDED HOWEVER, IN NO EVENT SHALL
INDEMNIFICATION UNDER SECTION 10.1(A) AND (B) FOR BREACHES OF REPRESENTATIONS,
WARRANTIES AND COVENANTS EXCEED THE PURCHASE PRICE ACTUALLY PAID BY BUYER TO
SELLER.  INDEMNIFICATION PURSUANT TO THIS ARTICLE X SHALL BE THE SOLE AND
EXCLUSIVE REMEDY FOR BREACHES OF REPRESENTATIONS AND WARRANTIES AND COVENANTS TO
BE PERFORMED PRIOR TO CLOSING.

ARTICLE XI

MISCELLANEOUS

11.1        ASSIGNMENT.  NEITHER SELLER NOR BUYER MAY ASSIGN THIS AGREEMENT, OR
ASSIGN ITS RIGHTS OR DELEGATE ITS DUTIES HEREUNDER, WITHOUT THE PRIOR WRITTEN
CONSENT OF THE OTHER PARTY HERETO.  THIS AGREEMENT WILL BE BINDING UPON, INURE
TO THE BENEFIT OF, AND BE ENFORCEABLE BY THE PARTIES AND THEIR RESPECTIVE
SUCCESSORS AND ASSIGNS.

11.2        SEVERABILITY.  ANY PROVISION OF THIS AGREEMENT WHICH IS ILLEGAL,
INVALID OR UNENFORCEABLE SHALL BE INEFFECTIVE TO THE EXTENT OF SUCH ILLEGALITY,
INVALIDITY OR UNENFORCEABILITY, WITHOUT AFFECTING IN ANY WAY THE REMAINING
PROVISIONS HEREOF.

11.3        GOVERNING LAW.  THIS AGREEMENT, ITS CONSTRUCTION AND THE REMEDIES
FOR ITS ENFORCEMENT OR BREACH ARE TO BE APPLIED PURSUANT TO, AND IN ACCORDANCE
WITH, THE LAWS OF THE STATE OF DELAWARE, WITHOUT REGARD TO THE PRINCIPLES OF
CONFLICTS OF LAW THEREOF.

11.4        CONSENT TO JURISDICTION, SERVICE AND VENUE.  FOR THE PURPOSE OF ANY
SUIT, ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT, EACH OF
THE PARTIES HEREBY AGREES THAT EXCLUSIVE JURISDICTION AND VENUE FOR ANY SUIT
BETWEEN THE PARTIES SHALL BE IN THE COURTS OF THE STATE OF DELAWARE OR THE
PROVINCE OF ONTARIO, REGARDLESS OF THE CONVENIENCE OF SUCH FORUMS.  NEITHER
PARTY WILL OPPOSE THE ENFORCEMENT AGAINST IT IN ANY OTHER JURISDICTION OF ANY
JUDGEMENT OR ORDER OBTAINED FROM A DELAWARE OR ONTARIO COURT REGARDING THIS
AGREEMENT. THE PARTIES FURTHER AGREE AND CONSENT TO ACCEPT AND ACKNOWLEDGE ALL
SERVICE OF PROCESS CARRIED OUT BY MEANS OF REGISTERED MAIL, RETURN RECEIPT
REQUESTED, IN ACCORDANCE WITH SECTION 11.10,  IN CONNECTION WITH ANY SUCH
MATTER.

11.5        JUDGMENT CURRENCY.  IF FOR THE PURPOSE OF OBTAINING JUDGMENT AGAINST
A PARTY IN ANY COURT IN ANY JURISDICTION WITH RESPECT TO THIS AGREEMENT, IT
BECOMES NECESSARY TO CONVERT INTO THE CURRENCY OF SUCH JURISDICTION (IN THIS
SECTION REFERRED TO AS THE “JUDGMENT CURRENCY”) ANY AMOUNT DUE HEREUNDER IN ANY
CURRENCY OTHER THAN THE JUDGMENT CURRENCY (IN THIS SECTION REFERRED TO AS THE

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“CURRENCY OF THE AGREEMENT”), THEN CONVERSION SHALL BE MADE AT THE RATE OF
EXCHANGE PREVAILING ON THE BUSINESS DAY PRECEDING (I) THE DATE OF ACTUAL PAYMENT
OF THE AMOUNT DUE, IN THE CASE OF PROCEEDINGS IN THE COURTS OF ANY JURISDICTION
THAT WILL GIVE EFFECT TO SUCH CONVERSION BEING MADE ON SUCH DAY, OR (II) THE DAY
ON WHICH THE JUDGMENT IS GIVEN, IN THE CASE OF PROCEEDINGS IN THE COURTS OF THE
PROVINCE OF ONTARIO OR OF ANY OTHER JURISDICTION (THE APPLICABLE DATE AS OF
WHICH SUCH CONVERSION IS MADE PURSUANT TO THIS SECTION BEING REFERRED TO AS THE
“JUDGMENT CONVERSION DATE”).  FOR THIS PURPOSE, “RATE OF EXCHANGE” MEANS THE
RATE AT WHICH THE ROYAL BANK OF CANADA WOULD BE PREPARED ON THE RELEVANT DATE,
TO SELL THE CURRENCY OF THE AGREEMENT TO OBTAIN THE JUDGMENT CURRENCY.  IN THE
EVENT THAT THERE IS A CHANGE IN THE RATE OF EXCHANGE PREVAILING BETWEEN THE
JUDGMENT CONVERSION DATE AND THE DATE OF PAYMENT OF THE AMOUNT DUE, THE PARTY
AGAINST WHICH JUDGMENT IS RENDERED SHALL, ON THE DATE OF PAYMENT, PAY SUCH
ADDITIONAL AMOUNTS (IF ANY) AS MAY BE NECESSARY TO ENSURE THAT THE AMOUNT PAID
ON SUCH DATE IS THE AMOUNT IN THE JUDGMENT CURRENCY WHICH, WHEN CONVERTED AT THE
RATE OF EXCHANGE PREVAILING ON THE DATE OF PAYMENT, IS THE AMOUNT THEN DUE UNDER
THIS AGREEMENT IN THE CURRENCY OF THE AGREEMENT.  ANY ADDITIONAL AMOUNT DUE
UNDER THIS SECTION 11.4 WILL BE DUE AS A SEPARATE DEBT AND SHALL NOT BE AFFECTED
BY JUDGMENT BEING OBTAINED FOR ANY OTHER SUMS DUE OR IN RESPECT OF THIS
AGREEMENT.

11.6        BULK SALES.  IN CONSIDERATION OF THE INDEMNITY PROVIDED HEREIN BY
THE SELLER AND THE PRINCIPAL OWNERS TO THE BUYER, THE BUYER HEREBY WAIVES
COMPLIANCE BY THE SELLER WITH THE PROVISIONS OF ANY APPLICABLE BULK TRANSFER
LAWS, INCLUDING THE BULK SALES ACT (ONTARIO), OF ANY JURISDICTION IN CONNECTION
WITH THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT.

11.7        ENTIRE AGREEMENT; AMENDMENT.  THIS AGREEMENT, INCLUDING THE EXHIBITS
AND SCHEDULES HERETO, AND EACH ADDITIONAL AGREEMENT OR OTHER DOCUMENT TO BE
EXECUTED AND DELIVERED PURSUANT HERETO, CONSTITUTE ALL OF THE AGREEMENTS OF THE
PARTIES WITH RESPECT TO, AND SUPERSEDE ALL PRIOR AGREEMENTS AND UNDERSTANDINGS
RELATING TO THE SUBJECT MATTER OF, THIS AGREEMENT AND THE TRANSACTIONS
CONTEMPLATED HEREUNDER.  THIS AGREEMENT MAY NOT BE MODIFIED OR AMENDED EXCEPT BY
A WRITTEN INSTRUMENT SPECIFICALLY REFERRING TO THIS AGREEMENT SIGNED BY THE
PARTIES HERETO.

11.8        WAIVER.  NO WAIVER BY ONE PARTY OF THE OTHER PARTY’S OBLIGATIONS, OR
OF ANY BREACH OR DEFAULT HEREUNDER BY ANY OTHER PARTY, SHALL BE VALID OR
EFFECTIVE, UNLESS SUCH WAIVER IS SET FORTH IN WRITING AND IS SIGNED BY THE PARTY
GIVING SUCH WAIVER; AND NO SUCH WAIVER SHALL BE DEEMED A WAIVER OF ANY
SUBSEQUENT BREACH OR DEFAULT OF THE SAME OR SIMILAR NATURE OR ANY OTHER BREACH
OR DEFAULT BY SUCH OTHER PARTY.

11.9        INTERPRETATION; HEADINGS.  THIS AGREEMENT IS THE RESULT OF
ARMS’-LENGTH NEGOTIATIONS BETWEEN THE PARTIES HERETO AND NO PROVISION HEREOF,
BECAUSE OF ANY AMBIGUITY FOUND TO BE CONTAINED THEREIN OR OTHERWISE, SHALL BE
CONSTRUED AGAINST A PARTY BY REASON OF THE FACT THAT SUCH PARTY OR ITS LEGAL
COUNSEL WAS THE DRAFTSMAN OF THAT PROVISION.  THE SECTION, SUBSECTION AND ANY
PARAGRAPH HEADINGS CONTAINED HEREIN ARE FOR THE PURPOSE OF CONVENIENCE ONLY AND
ARE NOT INTENDED TO DEFINE OR LIMIT OR AFFECT, AND SHALL NOT BE CONSIDERED IN
CONNECTION WITH, THE INTERPRETATION OF ANY OF THE TERMS OR PROVISIONS OF THIS
AGREEMENT.

11.10      NOTICES.  ALL NOTICES, REQUESTS, DEMANDS OR OTHER COMMUNICATIONS
HEREUNDER SHALL BE IN WRITING AND SHALL BE DEEMED TO HAVE BEEN DULY GIVEN TO THE
PERSON DESIGNATED BELOW (I) ON THE DATE OF DELIVERY IF DELIVERED IN PERSON; (II)
ON THE FIRST BUSINESS DAY AFTER BEING SENT BY FAX, PROVIDED THAT

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THE SUCCESSFUL TRANSMISSION OF THE FAX HAS BEEN CONFIRMED THROUGH A CONFIRMATION
FUNCTION SHEET PROVIDED BY THE FAX MACHINE USED FOR SUCH TRANSMISSION; (III) ON
THE THIRD BUSINESS DAY FOLLOWING THE DEPOSIT THEREOF IN THE UNITED STATES MAIL
OR IN CANADA POST, PROVIDED IT IS MAILED BY CERTIFIED MAIL, RETURN RECEIPT
REQUESTED AND POSTAGE PREPAID AND PROPERLY ADDRESSED; OR (IV) ON THE SECOND
BUSINESS DAY AFTER BEING SENT BY AIR COURIER.  ANY PARTY HERETO MAY FROM TIME TO
TIME, BY WRITTEN NOTICE TO THE OTHER PARTIES, DESIGNATE A DIFFERENT ADDRESS,
WHICH SHALL BE SUBSTITUTED FOR THE ONE SPECIFIED BELOW:

If to Seller:

Sensible Security Solutions Inc.

45 O’Connor Street, Suite 870

Ottawa, Ontario Canada K1P 1A4

Attn:  Paul Saucier

Fax:   (613) 721-6744

with a copy to:

Gowling Lafleur Henderson LLP

160 Elgin Street, Suite 2600

Ottawa, Ontario Canada K1P1C3

Attn:  Michael Boehm

Fax:   (613) 788-3467

If to Buyer, to:

DynTek, Inc.

19700 Fairchild Road, Suite 230

Irvine, California 92612

Attn:  Chief Executive Officer

Fax:  (949) 271-6798

with a copy to:

Stradling Yocca Carlson & Rauth

660 Newport Center Drive, Suite 1600

Newport Beach, CA 92660 6441

Attn:  Christopher D. Ivey

Fax:  (949) 725-4100

11.11      PUBLIC ANNOUNCEMENTS.  NEITHER SELLER OR BUYER WILL MAKE ANY PUBLIC
ANNOUNCEMENTS CONCERNING MATTERS SET FORTH IN THIS AGREEMENT OR THE NEGOTIATION
THEREOF WITHOUT THE PRIOR WRITTEN CONSENT OF THE OTHER PARTY UNLESS SUCH
DISCLOSURE IS REQUIRED BY LAW OR THE RULES AND REGULATIONS OF THE SEC.  ANY SUCH
DISCLOSURE SHALL BE PROVIDED FOR REVIEW TO THE OTHER PARTY IN ADVANCE OF PUBLIC
RELEASE TO THE EXTENT REASONABLY PRACTICAL.

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11.12      ATTORNEYS FEES.  IF ANY ACTION OR PROCEEDING RELATING TO THIS
AGREEMENT OR THE ENFORCEMENT OF ANY PROVISION OF THIS AGREEMENT IS BROUGHT BY A
PARTY HERETO AGAINST ANY PARTY HERETO, THE PREVAILING PARTY SHALL BE ENTITLED TO
RECOVER REASONABLE ATTORNEYS’ FEES, COSTS AND DISBURSEMENTS, IN ADDITION TO ANY
OTHER RELIEF TO WHICH THE PREVAILING PARTY MAY BE ENTITLED.

11.13      COUNTERPARTS.  THIS AGREEMENT MAY BE EXECUTED IN SEPARATE
COUNTERPARTS, EACH OF WHICH SHALL BE DEEMED AN ORIGINAL, BUT ALL OF WHICH
TOGETHER SHALL CONSTITUTE ONE AND THE SAME INSTRUMENT.  THIS AGREEMENT SHALL
BECOME EFFECTIVE WHEN COUNTERPARTS HAVE BEEN SIGNED BY EACH OF THE PARTIES AND
DELIVERED BY FACSIMILE OR OTHER MEANS TO THE OTHER PARTY.

[Signature page to follow]

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IN WITNESS WHEREOF, each of Seller, Buyer and the Principal Owners have caused a
duly authorized representative to execute this Asset Purchase Agreement on the
date first written above.

 

 

 

PARENT

 

 

 

DYNTEK, INC.,

 

a Delaware corporation

 

 

 

By:

/s/ Casper Zublin, Jr.

 

 

Name:

Casper Zublin, Jr.

 

Title:

Chief Executive Officer

 

 

 

 

BUYER

 

 

 

DYNTEK CANADA INC.

 

an Ontario corporation

 

 

 

By:

/s/ Casper Zublin, Jr.

 

 

Name:

Casper Zublin, Jr.

 

Title:

President

 

 

 

 

SELLER

 

 

 

SENSIBLE SECURITY SOLUTIONS INC.,

 

an Ontario corporation

 

 

 

By:

/s/ Paul Saucier

 

 

Name:

Paul Saucier

 

Title:

President

 

 

 

 

SHAREHOLDER

 

 

 

3849597 CANADA INC.,

 

a Canadian corporation

 

 

 

By:

/s/ Paul Saucier

 

 

Name:

Paul Saucier

 

Title:

President

 

 

 

 

 

 

 

 

/s/ Paul Saucier

 

Witness

PAUL SAUCIER

 

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