Exhibit 10.1
 
SECURITIES PURCHASE AGREEMENT

This SECURITIES PURCHASE AGREEMENT (the “Agreement”) is dated as of the 26th day
of April, 2013 (the “Effective Date”), by and between REVOLUTIONS MEDICAL
CORPORATION, a Nevada corporation (the “Company”), and TCA GLOBAL CREDIT MASTER
FUND, LP, a Cayman Islands limited partnership (the “Buyer”).

RECITALS

WHEREAS, Buyer desires to purchase from Company, and the Company desires to sell
and issue to Buyer, upon the terms and subject to the conditions contained
herein, up to Two Million Dollars ($2,000,000) of senior secured convertible
redeemable debentures in the form attached hereto as Exhibit “A” (the
“Debentures”), of which Two Hundred Fifty Thousand Dollars ($250,000) shall be
purchased on the date hereof (the “First Closing”), and up to One Million Seven
Hundred Fifty Thousand Dollars ($1,750,000) may be purchased in additional
closings as set forth in Section 4.2 below (the “Additional Closings”)(each of
the First Closing and the Additional Closings are sometimes hereinafter
individually referred to as a “Closing” and collectively as the “Closings”), all
for the total purchase price of up to Two Million Dollars ($2,000,000) (the
“Purchase Price”), and all otherwise subject to the terms and provisions
hereinafter set forth; and

WHEREAS, the Company has agreed to secure all of its Obligations to Buyer under
the Debentures, this Agreement and all other Transaction Documents by: (i)
granting to the Buyer an unconditional and continuing first priority security
interest in all of the assets and properties of the Company, whether now
existing or hereafter acquired, pursuant to a Security Agreement dated as of the
date hereof (the “Security Agreement”); (ii) granting to the Buyer a continuing
and first priority security interest and lien in certain stock (the “Pledged
Stock”) of the Company pursuant to a Stock Pledge and Escrow Agreement dated as
of the date hereof (the “Pledge Agreement”); (iii) obtaining and delivering to
Buyer validity certifications from certain officers and directors of the
Company, as required by Buyer (the “Validity Certifications”); and (iv) agreeing
to the filing of UCC-1 Financing Statements covering all of the assets and
properties of the Company, whether now existing or hereafter acquired
(collectively, the “UCC-1’s”);

NOW, THEREFORE, in consideration of the premises and the mutual covenants of the
parties hereinafter expressed and other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the parties hereto,
each intending to be legally bound, agree as follows:

ARTICLE I
RECITALS, EXHIBITS, SCHEDULES

The foregoing recitals are true and correct and, together with the Schedules and
Exhibits referred to hereafter, are hereby incorporated into this Agreement by
this reference.

ARTICLE II
DEFINITIONS

 
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For purposes of this Agreement, except as otherwise expressly provided or
otherwise defined elsewhere in this Agreement, or unless the context otherwise
requires, the capitalized terms in this Agreement shall have the meanings
assigned to them in this Article as follows:

2.1           “Advisory Fee Shares” means the shares of the Company’s Common
Stock to be issued by the Company to Buyer in accordance with Section 7.5 below.

2.2           “Affiliate” means, with respect to a Person, any other Person
directly or indirectly controlling, controlled by, or under common control with,
such Person at any time during the period for which the determination of
affiliation is being made. For purposes of this definition, the term “control,”
“controlling,” “controlled” and words of similar import, when used in this
context, means, with respect to any Person, the possession, directly or
indirectly, of the power to direct, or cause the direction of, management
policies of such Person, whether through the ownership of voting securities, by
contract or otherwise.

2.3           “Assets” means all of the properties and assets of the Person in
question, as the context may so require, whether real, personal or mixed,
tangible or intangible, wherever located, whether now owned or hereafter
acquired.

2.4           “Business Day” shall mean any day other than a Saturday, Sunday or
a legal holiday on which federal banks are authorized or required to be closed
for the conduct of commercial banking business.

2.5           “Claims” means any Proceedings, Judgments, Obligations, threats,
losses, damages, deficiencies, settlements, assessments, charges, costs and
expenses of any nature or kind.

2.6           “Common Stock” means the Company’s common stock, $0.001 par value
per share.

2.7           “Consent” means any consent, approval, order or authorization of,
or any declaration, filing or registration with, or any application or report
to, or any waiver by, or any other action (whether similar or dissimilar to any
of the foregoing) of, by or with, any Person, which is necessary in order to
take a specified action or actions, in a specified manner and/or to achieve a
specific result.

2.8           “Contract” means any written or oral contract, agreement, order or
commitment of any nature whatsoever, including, any sales order, purchase order,
lease, sublease, license agreement, services agreement, loan agreement,
mortgage, security agreement, guarantee, management contract, employment
agreement, consulting agreement, partnership agreement, shareholders agreement,
buy-sell agreement, option, warrant, debenture, subscription, call or put.

2.9           “Effective Date” means the date so defined in the introductory
paragraph of this Agreement.

2.10          “Encumbrance” means any lien, security interest, pledge, mortgage,
easement, leasehold, assessment, tax, covenant, restriction, reservation,
conditional sale, prior assignment, or any other encumbrance, claim, burden or
charge of any nature whatsoever.

 
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2.11           “Environmental Requirements” means all Laws and requirements
relating to human, health, safety or protection of the environment or to
emissions, discharges, releases or threatened releases of pollutants,
contaminants, or Hazardous Materials in the environment (including, without
limitation, ambient air, surface water, ground water, land surface or subsurface
strata), or otherwise relating to the treatment, storage, disposal, transport or
handling of any Hazardous Materials.

2.12           “Exchange Act” shall mean the Securities Exchange Act of 1934, as
amended, and the rules and regulations promulgated thereunder.

2.13           “GAAP” means generally accepted accounting principles, methods
and practices set forth in the opinions and pronouncements of the Accounting
Principles Board and the American Institute of Certified Public Accountants, and
statements and pronouncements of the Financial Accounting Standards Board, the
SEC or of such other Person as may be approved by a significant segment of the
U.S. accounting profession, in each case as of the date or period at issue, and
as applied in the U.S. to U.S. companies.

2.14           “Governmental Authority” means any foreign, federal, state or
local government, or any political subdivision thereof, or any court, agency or
other body, organization, group, stock market or exchange exercising any
executive, legislative, judicial, quasi-judicial, regulatory or administrative
function of government.

2.15           “Hazardous Materials” means: (i) any petroleum or petroleum
products, radioactive materials, asbestos in any form that is or could become
friable, urea formaldehyde foam insulation and transformers or other equipment
that contain dielectric fluid containing levels of polychlorinated biphenyls
(PCB’s); (ii) any chemicals, materials, substances or wastes which are now or
hereafter become defined as or included in the definition of “hazardous
substances,” “hazardous wastes,” “hazardous materials,” “extremely hazardous
wastes,” “restricted hazardous wastes,” “toxic substances,” “toxic pollutants”
or words of similar import, under any Law; and (iii) any other chemical,
material, substance, or waste, exposure to which is now or hereafter prohibited,
limited or regulated by any Governmental Authority.

2.16           “Judgment” means any order, writ, injunction, fine, citation,
award, decree, or any other judgment of any nature whatsoever of any
Governmental Authority.

2.17           “Law” means any provision of any law, statute, ordinance, code,
constitution, charter, treaty, rule or regulation of any Governmental Authority.

2.18           “Leases” means all leases for real or personal property.

2.19           “Material Adverse Effect” shall mean: (i) a material adverse
change in, or a material adverse effect upon, the Assets, business, prospects,
properties, financial condition or results of operations of the Company; (ii) a
material impairment of the ability of the Company to perform any of its
Obligations under any of the Transaction Documents; (iii) a material adverse
effect on: (A) any material portion of the “Collateral” (as such terms is
defined in the Security Agreement); (B) the legality, validity, binding effect
or enforceability against the Company of any of the Transaction Documents; (C)
the perfection or priority of any Encumbrance granted to Buyer under any
Transaction Documents; or (D) the rights or remedies of the Buyer under any of
the Transaction Documents; or (iv) a material adverse effect or impairment on
the Buyer’s ability to sell Advisory Fee Shares or other shares of the Company’s
Common Stock issuable to Buyer under any of the Transaction Documents without
limitation or restriction in the Principal Trading Market.  For purposes of
determining whether any of the foregoing changes, effects, impairments, or other
events have occurred, such determination shall be made by Buyer, in its sole,
but reasonably exercised, discretion.

 
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2.20           “Material Contract” shall mean any Contract to which the Company
is a party or by which the Company or any of its Assets are bound and which: (i)
must be disclosed to the SEC or any other Governmental Authority pursuant to the
Securities Act, the Exchange Act, the rules and regulations of the SEC, or any
other laws, rules or regulations of any Governmental Authority; (ii) involves
aggregate payments of Twenty-Five Thousand Dollars ($25,000) or more to or from
the Company; (iii) involves delivery, purchase, licensing or provision, by or to
the Company, of any goods, services, assets or other items having a value (or
potential value) over the term of such Contract of Twenty-five Thousand Dollars
($25,000) or more or is otherwise material to the conduct of the Company’s
business as now conducted and as contemplated to be conducted in the future;
(iii) involves a Company Lease; (iv) imposes any guaranty, surety or
indemnification Obligations on the Company; or (v) prohibits the Company from
engaging in any business or competing anywhere in the world.

2.21           “Obligation” means any debt, liability or obligation of any
nature whatsoever (including any required performance of any covenants or
agreements), whether secured, unsecured, recourse, nonrecourse, liquidated,
unliquidated, accrued, absolute, fixed, contingent, ascertained, unascertained,
known, unknown or obligations under executory Contracts.

2.22           “Ordinary Course of Business” means the ordinary course of
business of the Person in question, consistent with past custom and practice
(including with respect to quantity, quality and frequency).

2.23           “Permit” means any license, permit, approval, waiver, order,
authorization, right or privilege of any nature whatsoever, granted, issued,
approved or allowed by any Governmental Authority.

2.24           “Person” means any individual, sole proprietorship, joint
venture, partnership, company, corporation, association, cooperation, trust,
estate, Governmental Authority, or any other entity of any nature whatsoever.

2.25           “Principal Trading Market” shall mean the Nasdaq Global Select
Market, the Nasdaq Global Market, the Nasdaq Capital Market, the OTC Markets,
including the Bulletin Board, the NYSE Euronext or the New York Stock Exchange,
whichever is at the time the principal trading exchange or market for the Common
Stock.

2.26           “Proceeding” means any demand, claim, suit, action, litigation,
investigation, audit, study, arbitration, administrative hearing, or any other
proceeding of any nature whatsoever.

2.27           “Real Property” means any real estate, land, building, structure,
improvement, fixture or other real property of any nature whatsoever, including,
but not limited to, fee and leasehold interests.

2.28           “SEC” means the United States Securities and Exchange Commission.

 
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2.29           “Securities” means, collectively, the Debentures, the Advisory
Fee Shares and any additional shares of Common Stock issuable in connection with
a conversion of the Debentures or the terms of this Agreement or any other
Transaction Documents.

2.30           “Securities Act” means the Securities Act of 1933, as amended,
and the rules and regulations promulgated thereunder.

2.31           “Tax” means (i) any foreign, federal, state or local income,
profits, gross receipts, franchise, sales, use, occupancy, general property,
real property, personal property, intangible property, transfer, fuel, excise,
accumulated earnings, personal holding company, unemployment compensation,
social security, withholding taxes, payroll taxes, or any other tax of any
nature whatsoever, (ii) any foreign, federal, state or local organization fee,
qualification fee, annual report fee, filing fee, occupation fee, assessment,
rent, or any other fee or charge of any nature whatsoever, or (iii) any
deficiency, interest or penalty imposed with respect to any of the foregoing.

2.32           “Tax Return” means any tax return, filing, declaration,
information statement or other form or document required to be filed in
connection with or with respect to any Tax.

2.33           “Transaction Documents” means any and all documents or
instruments executed or to be executed by the Company in connection with this
Agreement, including the Debentures, the Security Agreement, the Pledge
Agreement, the Validity Certifications, and the UCC-1’s, together with all
modifications, amendments, extensions, future advances, renewals, and
substitutions thereof.

ARTICLE III
INTERPRETATION

In this Agreement, unless the express context otherwise requires: (i) the words
“herein,” “hereof” and “hereunder” and words of similar import refer to this
Agreement as a whole and not to any particular provision of this Agreement; (ii)
references to the words “Article” or “Section” refer to the respective Articles
and Sections of this Agreement, and references to “Exhibit” or “Schedule” refer
to the respective Exhibits and Schedules annexed hereto; (iii) references to a
“party” mean a party to this Agreement and include references to such party’s
permitted successors and permitted assigns; (iv) references to a “third party”
mean a Person not a party to this Agreement; and (v) the terms “dollars” and “$”
means U.S. dollars; (vi) wherever the word “include,” “includes” or “including”
is used in this Agreement, it will be deemed to be followed by the words
“without limitation”.

ARTICLE IV
PURCHASE AND SALE OF DEBENTURES

4.1           Purchase and Sale of Debentures.  Subject to the satisfaction (or
waiver) of the terms and conditions of this Agreement, Buyer agrees to purchase,
at each Closing, and Company agrees to sell and issue to Buyer, at each Closing,
Debentures in the amount of the Purchase Price applicable to each Closing as
more specifically set forth below.

 
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4.2           Closing Dates. The First Closing of the purchase and sale of the
Debentures shall be for Two Hundred Fifty Thousand Dollars ($250,000), and shall
take place on the Effective Date, subject to satisfaction of the conditions to
the First Closing set forth in this Agreement (the “First Closing
Date”).  Additional Closings of the purchase and sale of the Debentures shall be
at such times and for such amounts as determined in accordance with Section 4.4
below, subject to satisfaction of the conditions to the Additional Closings set
forth in this Agreement (the “Additional Closing Dates”) (collectively referred
to as the “Closing Dates”).  The Closings shall occur on the respective Closing
Dates through the use of overnight mails and subject to customary escrow
instructions from Buyer and its counsel, or in such other manner as is mutually
agreed to by the Company and the Buyer.

4.3           Form of Payment.  Subject to the satisfaction of the terms and
conditions of this Agreement, on each Closing Date: (i) the Buyer shall deliver
to the Company, to a Company account designated by the Company, the aggregate
proceeds for the Debentures to be issued and sold to Buyer at each such Closing,
minus the fees to be paid directly from the proceeds of each such Closing as set
forth in this Agreement, in the form of wire transfers of immediately available
U.S. dollars; and (ii) the Company shall deliver to Buyer the Securities which
Buyer is purchasing hereunder at each Closing, duly executed on behalf of the
Company, together with any other documents required to be delivered pursuant to
this Agreement.

4.4           Additional Closings.  At any time after the First Closing but
prior to the maturity date of any of the Debentures issued in the First Closing,
the Company may request that Buyer purchase additional Debentures hereunder in
Additional Closings by written notice to Buyer, and, subject to the conditions
below, Buyer shall purchase such additional Debentures in such amounts and at
such times as Buyer and the Company may mutually agree, so long as the following
conditions have been satisfied, in Buyer’s sole and absolute discretion: (i) no
default or “Event of Default” (as such term is defined in any of the Transaction
Documents) shall have occurred or be continuing under this Agreement or any
other Transaction Documents, and no event shall have occurred that, with the
passage of time, the giving of notice, or both, would constitute a default or an
Event of Default hereunder or thereunder; and (ii) any additional purchase of
Debentures beyond the purchase of Debentures at the First Closing shall have
been approved by Buyer, which approval may be given or withheld in Buyer’s sole
and absolute discretion.

ARTICLE V
BUYER’S REPRESENTATIONS AND WARRANTIES

Buyer represents and warrants to the Company, that:
 
5.1           Investment Purpose. Buyer is acquiring the Securities for its own
account for investment only and not with a view towards, or for resale in
connection with, the public sale or distribution thereof, except pursuant to
sales registered or exempted under the Securities Act; provided, however, that
by making the representations herein, Buyer reserves the right to dispose of the
Securities at any time in accordance with or pursuant to an effective
registration statement covering such Securities or an available exemption under
the Securities Act.

5.2           Accredited Buyer Status.  Buyer is an “accredited investor” as
that term is defined in Rule 501 of Regulation D, as promulgated under the
Securities Act.

5.3           Reliance on Exemptions.  Buyer understands that the Securities are
being offered and sold to it in reliance on specific exemptions from the
registration requirements of United States federal and state securities laws and
that the Company is relying in part upon the truth and accuracy of, and Buyer’s
compliance with, the representations, warranties, agreements, acknowledgments
and understandings of Buyer set forth herein in order to determine the
availability of such exemptions and the eligibility of Buyer to acquire the
Securities.

 
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5.4           Information. Buyer and its advisors, if any, have been furnished
with all materials they have requested relating to the business, finances and
operations of the Company and information Buyer deemed material to making an
informed investment decision regarding its purchase of the Securities. Buyer and
its advisors, if any, have been afforded the opportunity to ask questions of the
Company and its management. Neither such inquiries, nor any materials provided
to Buyer, nor any other due diligence investigations conducted by Buyer or its
advisors, if any, or its representatives, shall modify, amend or affect Buyer’s
right to fully rely on the Company’s representations and warranties contained in
Article VI below.  Buyer understands that its investment in the Securities
involves a high degree of risk.  Buyer is in a position regarding the Company,
which, based upon economic bargaining power, enabled and enables Buyer to obtain
information from the Company in order to evaluate the merits and risks of this
investment.  Buyer has sought such accounting, legal and tax advice as it has
considered necessary to make an informed investment decision with respect to its
acquisition of the Securities.

5.5           No Governmental Review. Buyer understands that no United States
federal or state Governmental Authority has passed on or made any recommendation
or endorsement of the Securities, or the fairness or suitability of the
investment in the Securities, nor have such Governmental Authorities passed upon
or endorsed the merits of the offering of the Securities.

5.6           Authorization, Enforcement. This Agreement has been duly and
validly authorized, executed and delivered on behalf of Buyer and is a valid and
binding agreement of Buyer, enforceable in accordance with its terms, except as
such enforceability may be limited by general principles of equity or applicable
bankruptcy, insolvency, reorganization, moratorium, liquidation and other
similar laws relating to, or affecting generally, the enforcement of applicable
creditors’ rights and remedies.

ARTICLE VI
REPRESENTATIONS AND WARRANTIES OF THE COMPANY

To induce the Buyer to purchase the Securities, the Company makes the following
representations and warranties to Buyer, each of which shall be true and correct
in all respects as of the date of the execution and delivery of this Agreement
and as of the date of each Closing hereunder, and which shall survive the
execution and delivery of this Agreement:

6.1           Subsidiaries.  The Company has no subsidiaries and the Company
does not own, directly or indirectly, any outstanding securities of or other
interests in, or have any control over, any other Person.

6.2           Organization.  The Company is a corporation, duly organized,
validly existing and in good standing under the Laws of the jurisdiction in
which it is incorporated.  The Company has the full corporate power and
authority and all necessary certificates, licenses, approvals and Permits to:
(i) enter into and execute this Agreement and the Transaction Documents and to
perform all of its Obligations hereunder and thereunder; and (ii) own and
operate its Assets and properties and to conduct and carry on its business as
and to the extent now conducted.  The Company is duly qualified to transact
business and is in good standing as a foreign corporation in each jurisdiction
where the character of its business or the ownership or use and operation of its
Assets or properties requires such qualification.  The exact legal name of the
Company is as set forth in the first paragraph of this Agreement, and the
Company does not currently conduct, nor has the Company, during the last five
(5) years conducted, business under any other name or trade name.

 
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6.3           Authority and Approval of Agreement; Binding Effect.  The
execution and delivery by Company of this Agreement and the Transaction
Documents, and the performance by Company of all of its Obligations hereunder
and thereunder, including the issuance of the Securities, have been duly and
validly authorized and approved by the Company and its board of directors
pursuant to all applicable Laws and no other corporate action or Consent on the
part of Company, its board of directors, stockholders or any other Person is
necessary or required by the Company to execute this Agreement and the
Transaction Documents, consummate the transactions contemplated herein and
therein, perform all of Company’s Obligations hereunder and thereunder, or to
issue the Securities.  This Agreement and each of the Transaction Documents have
been duly and validly executed by Company (and the officer executing this
Agreement and all such other Transaction Documents is duly authorized to act and
execute same on behalf of Company) and constitute the valid and legally binding
agreements of Company, enforceable against Company in accordance with their
respective terms, except as such enforceability may be limited by general
principles of equity or applicable bankruptcy, insolvency, reorganization,
moratorium, liquidation and other similar laws relating to, or affecting
generally, the enforcement of applicable creditors’ rights and remedies.

6.4           Capitalization. The authorized capital stock of the Company
consists of 250,000,000 shares of Common Stock and 5,000,000 shares of preferred
stock, par value $0.001 per share (the “Preferred Stock”), of which 77,000,000
shares of Common Stock are issued and outstanding as of the date hereof, and
1,000,000 shares of Preferred Stock are issued and outstanding as of the date
hereof.  All of such outstanding shares have been validly issued and are fully
paid and nonassessable, have been issued in compliance with all foreign, federal
and state securities laws and none of such outstanding shares were issued in
violation of any preemptive rights or similar rights to subscribe for or
purchase securities.  As of the Effective Date, no shares of the Company’s
capital stock are subject to preemptive rights or any other similar rights or
any Claims or Encumbrances suffered or permitted by the Company.  The Common
Stock is currently quoted on the OTC Bulletin Board under the trading symbol
“RMCP”.  The Company has received no notice, either oral or written, with
respect to the continued eligibility of the Common Stock for quotation on the
Principal Trading Market, and the Company has maintained all requirements on its
part for the continuation of such quotation.  Except as disclosed in the “SEC
Documents” (as hereinafter defined) and except for the Securities to be issued
pursuant to this Agreement, as of the date hereof: (i) there are no outstanding
options, warrants, scrip, rights to subscribe to, calls or commitments of any
character whatsoever relating to, or securities or rights convertible into, any
shares of capital stock of the Company or any of its Subsidiaries, or Contracts,
commitments, understandings or arrangements by which the Company or any of its
Subsidiaries is or may become bound to issue additional shares of capital stock
of the Company or any of its Subsidiaries, or options, warrants, scrip, rights
to subscribe to, calls or commitments of any character whatsoever relating to,
or securities or rights convertible into, any shares of capital stock of the
Company or any of its Subsidiaries; (ii) there are no outstanding debt
securities, notes, credit agreements, credit facilities or other Contracts or
instruments evidencing indebtedness of the Company or any of its Subsidiaries,
or by which the Company or any of its Subsidiaries is or may become bound;
(iii) there are no outstanding registration statements with respect to the
Company or any of its securities; (iv) there are no agreements or arrangements
under which the Company or any of its Subsidiaries is obligated to register the
sale of any of their securities under the Securities Act (except pursuant to
this Agreement); (v) there are no financing statements securing obligations
filed in connection with the Company or any of its Assets; (vi) there are no
securities or instruments containing anti-dilution or similar provisions that
will be triggered by this Agreement or any related agreement or the consummation
of the transactions described herein or therein; and (vii) there are no
outstanding securities or instruments of the Company which contain any
redemption or similar provisions, and there are no Contracts by which the
Company is or may become bound to redeem a security of the Company.  The Company
has furnished to the Buyer true, complete and correct copies of: (I) the
Company’s Certificate of Incorporation, as amended and as in effect on the date
hereof (the “Certificate of Incorporation”); and (II) the Company’s Bylaws, as
in effect on the date hereof (the “Bylaws”).  Except for the Certificate of
Incorporation and the Bylaws, there are no other shareholder agreements, voting
agreements or other Contracts of any nature or kind that restrict, limit or in
any manner impose Obligations on the governance of the Company.

 
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6.5           No Conflicts; Consents and Approvals.  The execution,
delivery  and performance of this Agreement and the Transaction Documents, and
the consummation of the transactions contemplated hereby and thereby, including
the issuance of any of the Securities, will not: (i) constitute a violation of
or conflict with the Certificate of Incorporation, Bylaws or any other
organizational or governing documents of Company; (ii) constitute a violation
of, or a default or breach under (either immediately, upon notice, upon lapse of
time, or both), or conflicts with, or gives to any other Person any rights of
termination, amendment, acceleration or cancellation of, any provision of any
Contract to which Company is a party or by which any of its Assets or properties
may be bound; (iii) constitute a violation of, or a default or breach under
(either immediately, upon notice, upon lapse of time, or both), or conflicts
with, any Judgment; (iv) constitute a violation of, or conflict with, any Law
(including United States federal and state securities Laws and the rules and
regulations of any Principal Trading Market); or (v) result in the loss or
adverse modification of, or the imposition of any fine, penalty or other
Encumbrance with respect to, any Permit granted or issued to, or otherwise held
by or for the use of, Company or any of Company’s Assets.  The Company is not in
violation of its Certificate of Incorporation, Bylaws or other organizational or
governing documents and the Company is not in default or breach (and no event
has occurred which with notice or lapse of time or both could put the Company in
default or breach) under, and the Company has not taken any action or failed to
take any action that would give to any other Person any rights of termination,
amendment, acceleration or cancellation of, any Contract to which the Company is
a party or by which any property or Assets of the Company are bound or affected.
The businesses of the Company are not being conducted, and shall not be
conducted so long as Buyer owns any of the Securities, in violation of any Law.
Except as specifically contemplated by this Agreement, the Company is not
required to obtain any Consent of, from, or with any Governmental Authority, or
any other Person, in order for it to execute, deliver or perform any of its
Obligations under this Agreement or the Transaction Documents in accordance with
the terms hereof or thereof, or to issue and sell the Securities in accordance
with the terms hereof.  All Consents which the Company is required to obtain
pursuant to the immediately preceding sentence have been obtained or effected on
or prior to the date hereof.  The Company is not aware of any facts or
circumstances which might give rise to any of the foregoing.

6.6           Issuance of Securities. The Securities are duly authorized and,
upon issuance in accordance with the terms hereof, shall be duly issued, fully
paid and non-assessable, and free from all Encumbrances with respect to the
issue thereof, and will be issued in compliance with all applicable United
States federal and state securities Laws.  Assuming the accuracy of the
representations and warranties of the Buyer set forth in Article V above, the
offer and sale by the Company of the Securities is exempt from: (i) the
registration and prospectus delivery requirements of the Securities Act; and
(ii) the registration and/or qualification provisions of all applicable state
and provincial securities and “blue sky” laws.

 
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6.7           SEC Documents; Financial Statements. The Common Stock of the
Company is registered pursuant to Section 12 of the Exchange Act, the Company is
subject to the reporting requirements of Section 13 or 15(d) of the Exchange
Act, and the Company has timely filed all reports, schedules, forms, statements
and other documents required to be filed by it with the SEC under the Exchange
Act (all of the foregoing filed within the two (2) years preceding the date
hereof or amended after the date hereof and all exhibits included therein and
financial statements and schedules thereto and documents incorporated by
reference therein, being hereinafter referred to as the “SEC Documents”).  The
Company is current with its filing obligations under the Exchange Act and all
SEC Documents have been filed on a timely basis or the Company has received a
valid extension of such time of filing and has filed any such SEC Document prior
to the expiration of any such extension.  The Company represents and warrants
that true and complete copies of the SEC Documents are available on the SEC’s
website (www.sec.gov) at no charge to Buyer, and Buyer acknowledges that it may
retrieve all SEC Documents from such website and Buyer’s access to such SEC
Documents through such website shall constitute delivery of the SEC Documents to
Buyer; provided, however, that if Buyer is unable to obtain any of such SEC
Documents from such website at no charge, as result of such website not being
available or any other reason beyond Buyer’s control, then upon request from
Buyer, the Company shall deliver to Buyer true and complete copies of such SEC
Documents.  As of their respective dates, the SEC Documents complied in all
material respects with the requirements of the Exchange Act, and none of the SEC
Documents, at the time they were filed with the SEC, contained any untrue
statement of a material fact or omitted to state a material fact required to be
stated therein or necessary in order to make the statements therein, in light of
the circumstances under which they were made, not misleading.  None of the
statements made in any such SEC Documents is, or has been, required to be
amended or updated under applicable Law (except for such statements as have been
amended or updated in subsequent filings prior the date hereof, which amendments
or updates are also part of the SEC Documents).  As of their respective dates,
the financial statements of the Company included in the SEC Documents (the
“Financial Statements”) complied in all material respects with applicable
accounting requirements and the published rules and regulations of the SEC with
respect thereto. All of the Financial Statements have been prepared in
accordance with GAAP, consistently applied, during the periods involved (except:
(i) as may be otherwise indicated in such Financial Statements or the notes
thereto; or (ii) in the case of unaudited interim statements, to the extent they
may exclude footnotes or may be condensed or summary statements), and fairly
present in all material respects the consolidated financial position of the
Company as of the dates thereof and the consolidated results of its operations
and cash flows for the periods then ended (subject, in the case of unaudited
statements, to normal year-end audit adjustments).  To the knowledge of the
Company and its officers, no other information provided by or on behalf of the
Company to the Buyer, whether included in the SEC Documents or otherwise,
contains any untrue statement of a material fact or omits to state any material
fact necessary in order to make the statements therein, in the light of the
circumstance under which they are or were made, not misleading.

6.8           Absence of Certain Changes.  Since the date the last of the SEC
Documents was filed with the SEC and since the date of the most recent Financial
Statements, none of the following have occurred:

(a)           There has been no event or circumstance of any nature whatsoever
that has resulted in, or could reasonably be expected to result in, a Material
Adverse Effect; or

 
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(b)           Any transaction, event, action, development, payment, or any other
matter of any nature whatsoever entered into by the Company other than in the
Company’s Ordinary Course of Business.

6.9           Absence of Litigation or Adverse Matters.  No condition,
circumstance, event, agreement, document, instrument, restriction, litigation or
Proceeding (or threatened litigation or Proceeding or basis therefor) exists
which: (i) could adversely affect the validity or priority of the Encumbrances
granted to the Buyer under the Transaction Documents; (ii) could adversely
affect the ability of the Company to perform its Obligations under the
Transaction Documents; (iii) would constitute a default under any of the
Transaction Documents; (iv) would constitute such a default with the giving of
notice or lapse of time or both; or (v) would constitute or give rise to a
Material Adverse Effect. In addition: (vi) there is no Proceeding before or by
any Governmental Authority or any other Person, pending, or the best of
Company’s knowledge, threatened or contemplated by, against or affecting the
Company, its business or Assets; (vii) there is no outstanding Judgments against
or affecting the Company, its business or Assets; (viii) the Company is not in
breach or violation of any Contract; and (ix) the Company has not received any
material complaint from any customer, supplier, vendor or employee.

6.10           Liabilities and Indebtedness of the Company.  The Company does
not have any Obligations of any nature whatsoever, except: (i) as disclosed in
the Financial Statements; or (ii) Obligations incurred in the Company’s Ordinary
Course of Business since the date of the most recent Financial Statements which
do not or would not, individually or in the aggregate, exceed Ten Thousand
Dollars ($10,000) or otherwise have a Material Adverse Effect.

6.11           Title to Assets.  The Company has good and marketable title to,
or a valid leasehold interest in, all of its Assets which are material to the
business and operations of the Company as presently conducted, free and clear of
all Encumbrances or restrictions on the transfer or use of same.  Except as
would not have a Material Adverse Effect, the Company’s Assets are in good
operating condition and repair, ordinary wear and tear excepted, and are free of
any latent or patent defects which might impair their usefulness, and are
suitable for the purposes for which they are currently used and for the purposes
for which they are proposed to be used.

6.12           Real Estate.

  (a)           Real Property Ownership.  The Company does not own any Real
Property.

  (b)           Real Property Leases.  Except for ordinary office Leases
described in the SEC Documents (the “Company Leases”), the Company does not
lease any other Real Property.  With respect to each of the Company Leases: (i)
the Company has been in peaceful possession of the property leased thereunder
and neither the Company nor the landlord is in default thereunder; (ii) no
waiver, indulgence or postponement of any of the Obligations thereunder has been
granted by the Company or landlord thereunder; and (iii) there exists no event,
occurrence, condition or act known to the Company which, upon notice or lapse of
time or both, would be or could become a default thereunder or which could
result in the termination of the Company Leases, or any of them, or have a
Material Adverse Effect on the business of the Company, its Assets or its
operations or financial results.  The Company has not violated nor breached any
provision of any such Company Leases, and all Obligations required to be
performed by the Company under any of such Company Leases have been fully,
timely and properly performed.  The Company has delivered to the Buyer true,
correct and complete copies of all Company Leases, including all modifications
and amendments thereto, whether in writing or otherwise.  The Company has not
received any written or oral notice to the effect that any of the Company Leases
will not be renewed at the termination of the term of such Company Leases, or
that any of such Company Leases will be renewed only at higher rents.

 
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6.13           Material Contracts.  An accurate, current and complete copy of
each of the Material Contracts has been furnished to Buyer and/or is readily
available as part of the SEC Documents, and each of the Material Contracts
constitutes the entire agreement of the respective parties thereto relating to
the subject matter thereof.  There are no outstanding offers, bids, proposals or
quotations made by Company which, if accepted, would create a Material Contract
with Company.  Each of the Material Contracts is in full force and effect and is
a valid and binding Obligation of the parties thereto in accordance with the
terms and conditions thereof.  To the knowledge of the Company and its officers,
all Obligations required to be performed under the terms of each of the Material
Contracts by any party thereto have been fully performed by all parties thereto,
and no party to any Material Contracts is in default with respect to any term or
condition thereof, nor has any event occurred which, through the passage of time
or the giving of notice, or both, would constitute a default thereunder or would
cause the acceleration or modification of any Obligation of any party thereto or
the creation of any Encumbrance upon any of the Assets of the Company.  Further,
the Company has received no notice, nor does the Company have any knowledge, of
any pending or contemplated termination of any of the Material Contracts and, no
such termination is proposed or has been threatened, whether in writing or
orally.

6.14           Compliance with Laws.  To the knowledge of the Company and its
officers, the Company is and at all times has been in full compliance with all
Laws.  The Company has not received any notice that it is in violation of, has
violated, or is under investigation with respect to, or has been threatened to
be charged with, any violation of any Law.

6.15           Intellectual Property.  The Company owns or possesses adequate
and legally enforceable  rights or licenses to use all trademarks, trade names,
service marks, service mark registrations, service names, patents, patent
rights, copyrights, inventions, licenses, approvals, governmental
authorizations, trade secrets and all other intellectual property rights
necessary to conduct its business as now conducted. The Company does not have
any knowledge of any infringement by the Company of trademark, trade name
rights, patents, patent rights, copyrights, inventions, licenses, service names,
service marks, service mark registrations, trade secret or other intellectual
property rights of others, and, to the knowledge of the Company, there is no
Claim being made or brought against, or to the Company’s knowledge, being
threatened against, the Company regarding trademark, trade name, patents, patent
rights, invention, copyright, license, service names, service marks, service
mark registrations, trade secret or other intellectual property infringement;
and the Company is unaware of any facts or circumstances which might give rise
to any of the foregoing.

6.16           Labor and Employment Matters.  The Company is not involved in any
labor dispute or, to the knowledge of the Company, is any such dispute
threatened. To the knowledge of the Company and its officers, none of the
Company’s employees is a member of a union and the Company believes that its
relations with its employees are good.  To the knowledge of the Company and its
officers, the Company has complied in all material respects with all Laws
relating to employment matters, civil rights and equal employment opportunities.

 
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6.17           Employee Benefit Plans.  Except as set forth in the SEC
Documents, the Company does not have and has not ever maintained, and has no
Obligations with respect to any employee benefit plans or arrangements,
including employee pension benefit plans, as defined in Section 3(2) of the
Employee Retirement Income Security Act of 1974, as amended (“ERISA”),
multiemployer plans, as defined in Section 3(37) of ERISA, employee welfare
benefit plans, as defined in Section 3(1) of ERISA, deferred compensation plans,
stock option plans, bonus plans, stock purchase plans, hospitalization,
disability and other insurance plans, severance or termination pay plans and
policies, whether or not described in Section 3(3) of ERISA, in which employees,
their spouses or dependents of the Company participate (collectively, the
“Employee Benefit Plans”).  To the Company’s knowledge, all Employee Benefit
Plans meet the minimum funding standards of Section 302 of ERISA, where
applicable, and each such Employee Benefit Plan that is intended to be qualified
within the meaning of Section 401 of the Internal Revenue Code of 1986 is
qualified.  No withdrawal liability has been incurred under any such Employee
Benefit Plans and no “Reportable Event” or “Prohibited Transaction” (as such
terms are defined in ERISA), has occurred with respect to any such Employee
Benefit Plans, unless approved by the appropriate Governmental Authority.  To
the Company’s knowledge, the Company has promptly paid and discharged all
Obligations arising under ERISA of a character which if unpaid or unperformed
might result in the imposition of an Encumbrance against any of its Assets or
otherwise have a Material Adverse Effect.

6.18           Tax Matters.  The Company has made and timely filed all Tax
Returns required by any jurisdiction to which it is subject, and each such Tax
Return has been prepared in compliance with all applicable Laws, and all such
Tax Returns are true and accurate in all respects.  Except and only to the
extent that the Company has set aside on its books provisions reasonably
adequate for the payment of all unpaid and unreported Taxes, the Company has
timely paid all Taxes shown or determined to be due on such Tax Returns, except
those being contested in good faith, and the Company has set aside on its books
provision reasonably adequate for the payment of all Taxes for periods
subsequent to the periods to which such Tax Returns apply. There are no unpaid
Taxes in any material amount claimed to be due by the taxing authority of any
jurisdiction, and the officers of the Company know of no basis for any such
claim.  The Company has withheld and paid all Taxes to the appropriate
Governmental Authority required to have been withheld and paid in connection
with amounts paid or owing to any Person.  There is no Proceeding or Claim for
refund now in progress, pending or threatened against or with respect to the
Company regarding Taxes.

6.19           Insurance.  The Company is covered by valid, outstanding and
enforceable policies of insurance which were issued to it by reputable insurers
of recognized financial responsibility, covering its properties, Assets and
businesses against losses and risks normally insured against by other
corporations or entities in the same or similar lines of businesses as the
Company is engaged and in coverage amounts which are prudent and typically and
reasonably carried by such other corporations or entities (the “Insurance
Policies”).  Such Insurance Policies are in full force and effect, and all
premiums due thereon have been paid.  None of the Insurance Policies will lapse
or terminate as a result of the transactions contemplated by this
Agreement.  The Company has complied with the provisions of such Insurance
Policies.  The Company has not been refused any insurance coverage sought or
applied for and the Company does not have any reason to believe that it will not
be able to renew its existing Insurance Policies as and when such Insurance
Policies expire or to obtain similar coverage from similar insurers as may be
necessary to continue its business at a cost that would not materially and
adversely affect the condition, financial or otherwise, or the earnings,
business or operations of the Company.

6.20           Permits.  The Company possesses all Permits necessary to conduct
its business, and the Company has not received any notice of, or is otherwise
involved in any Proceedings relating to, the revocation or modification of any
such Permits.  All such Permits are valid and in full force and effect and the
Company is in full compliance with the respective requirements of all such
Permits.

 
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6.21           Bank Accounts; Business Location.  Schedule 6.21 sets forth, with
respect to each account of the Company with any bank, broker or other depository
institution: (i) the name and account number of such account; (ii) the name and
address of the institution where such account is held; (iii) the name of any
Person(s) holding a power of attorney with respect to such account, if any; and
(iv) the names of all authorized signatories and other Persons authorized to
withdraw funds from each such account.  The Company has no office or place of
business other than as identified on Schedule 6.21 and the Company's principal
places of business and chief executive offices are indicated on Schedule
6.21.  All books and records of the Company and other material Assets of the
Company are held or located at the principal offices of the Company indicated on
Schedule 6.21.

6.22           Environmental Laws.  Except as are used in such amounts as are
customary in the Company’s Ordinary Course of Business and in compliance with
all applicable Environmental Laws, the Company represents and warrants to Buyer
that: (i) the Company has not generated, used, stored, treated, transported,
manufactured, handled, produced or disposed of any Hazardous Materials, on or
off any of the premises of the Company (whether or not owned by the Company) in
any manner which at any time violates any Environmental Law or any Permit,
certificate, approval or similar authorization thereunder; (ii) the operations
of the Company comply in all material respects with all Environmental Laws and
all Permits certificates, approvals and similar authorizations thereunder; (iii)
there has been no investigation, Proceeding, complaint, order, directive, Claim,
citation or notice by any Governmental Authority or any other Person, nor is any
pending or, to the Company’s knowledge, threatened; and (iv) the Company does
not have any liability, contingent or otherwise, in connection with a release,
spill or discharge, threatened or actual, of any Hazardous Materials or the
generation, use, storage, treatment, transportation, manufacture, handling,
production or disposal of any Hazardous Material.

6.23           Illegal Payments.  Neither the Company, nor any director,
officer, agent, employee or other Person acting on behalf of the Company has, in
the course of his actions for, or on behalf of, the Company: (i) used any
corporate funds for any unlawful contribution, gift, entertainment or other
unlawful expenses relating to political activity; (ii) made any direct or
indirect unlawful payment to any foreign or domestic government official or
employee from corporate funds; (iii) violated or is in violation of any
provision of the U.S. Foreign Corrupt Practices Act of 1977, as amended; or (iv)
made any bribe, rebate, payoff, influence payment, kickback or other unlawful
payment to any foreign or domestic government official or employee.

6.24           Related Party Transactions.  Except for arm’s length transactions
pursuant to which the Company makes payments in the Ordinary Course of Business
upon terms no less favorable than the Company could obtain from third parties,
none of the officers, directors or employees of the Company, nor any
stockholders who own, legally or beneficially, five percent (5%) or more of the
issued and outstanding shares of any class of the Company’s capital stock (each
a “Material Shareholder”), is presently a party to any transaction with the
Company (other than for services as employees, officers and directors),
including any Contract providing for the furnishing of services to or by,
providing for rental of real or personal property to or from, or otherwise
requiring payments to or from, any officer, director or such employee or
Material Shareholder or, to the best knowledge of the Company, any other Person
in which any officer, director, or any such employee or Material Shareholder has
a substantial or material interest in or of which any officer, director or
employee of the Company or Material Shareholder is an officer, director, trustee
or partner.  There are no Claims or disputes of any nature or kind between the
Company and any officer, director or employee of the Company or any Material
Shareholder, or between any of them, relating to the Company and its business.

 
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6.25           Internal Accounting Controls.  The Company and each of its
subsidiaries maintain a system of internal accounting controls sufficient to
provide reasonable assurance that: (i) transactions are executed in accordance
with management’s general or specific authorizations; (ii) transactions are
recorded as necessary to permit preparation of financial statements in
conformity with GAAP and to maintain asset accountability; (iii) access to
Assets is permitted only in accordance with management’s general or specific
authorization; and (iv) the recorded accountability for Assets is compared with
the existing Assets at reasonable intervals and appropriate action is taken with
respect to any differences.

6.26           Acknowledgment Regarding Buyer’s Purchase of the Securities. The
Company acknowledges and agrees that Buyer is acting solely in the capacity of
an arm’s length purchaser with respect to this Agreement and the transactions
contemplated hereby. The Company further acknowledges that Buyer is not acting
as a financial advisor or fiduciary of the Company (or in any similar capacity)
with respect to this Agreement and the transactions contemplated hereby and any
advice given by Buyer or any of its representatives or agents in connection with
this Agreement and the transactions contemplated hereby is merely incidental to
Buyer’s purchase of the Securities. The Company further represents to Buyer that
the Company’s decision to enter into this Agreement has been based solely on the
independent evaluation by the Company and its representatives.

6.27           Seniority.  No indebtedness or other equity or security of the
Company is senior to the Debentures in right of payment, whether with respect to
interest or upon liquidation or dissolution, or otherwise, except only purchase
money security interests (which are senior only as to underlying Assets covered
thereby).

6.28           Brokerage Fees.  There is no Person acting on behalf of the
Company who is entitled to or has any claim for any brokerage or finder’s fee or
commission in connection with the execution of this Agreement or the
consummation of the transactions contemplated hereby.

6.29           Full Disclosure.  All the representations and warranties made by
Company herein or in the Schedules hereto, and all of the financial statements,
schedules, certificates, confirmations, agreements, contracts, and other
materials submitted to the Buyer in connection with or in furtherance of this
Agreement or pertaining to the transaction contemplated herein, whether made or
given by Company, its agents or representatives, are complete and accurate, and
do not omit any information required to make the statements and information
provided, in light of the transaction contemplated herein and in light of the
circumstances under which they were made, not misleading, accurate and
meaningful.

ARTICLE VII
COVENANTS

7.1           Negative Covenants.

(a)           Indebtedness.  So long as Buyer owns, legally or beneficially, any
of the Debentures, the Company shall not, either directly or indirectly, create,
assume, incur or have outstanding any indebtedness for borrowed money of any
nature or kind (including purchase money indebtedness), or become liable,
whether as endorser, guarantor, surety or otherwise, for any Obligation of any
other Person, except for: (i) the Debentures; (ii) Obligations disclosed in the
Financial Statements as of the Effective Date; and (iii) Obligations for
accounts payable, other than for money borrowed, incurred in the Company’s
Ordinary Course of Business; provided that, any management or similar fees
payable by the Company shall be fully subordinated in right of payment to the
prior payment in full of the Debentures.

 
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(b)           Encumbrances.  So long as Buyer owns, legally or beneficially, any
of the Debentures, the Company shall not, either directly or indirectly, create,
assume, incur or suffer or permit to exist any Encumbrance upon any Asset of the
Company, whether owned at the date hereof or hereafter acquired.

(c)           Investments.  So long as Buyer owns, legally or beneficially, any
of the Debentures, the Company shall not, either directly or indirectly, make or
have outstanding any new investments (whether through purchase of stocks,
obligations or otherwise) in, or loans or advances to, any other Person, or
acquire all or any substantial part of the assets, business, stock or other
evidence of beneficial ownership of any other Person, except following: (i)
investments in direct obligations of the United States or any state in the
United States; (ii) trade credit extended by the Company in the Company’s
Ordinary Course of Business; (iii) investments existing on the Effective Date
and set forth in the Financial Statements; and (iv) capital expenditures first
approved by the Buyer in writing, which approval shall not be unreasonably
withheld.

(d)           Issuances.  So long as Buyer owns, legally or beneficially, any of
the Debentures, the Company shall not, either directly or indirectly, issue any
equity, debt or convertible or derivative instruments or securities whatsoever,
except upon obtaining Buyer’s prior written consent, which consent may be
withheld in Buyer’s sole discretion.

(e)           Transfer; Merger.  So long as Buyer owns, legally or beneficially,
any of the Debentures, the Company shall not, either directly or indirectly,
permit or enter into any transaction involving a “Change in Control” (as
hereinafter defined), or any other merger, consolidation, sale, transfer,
license, Lease, Encumbrance or other disposition of all or substantially all of
its properties or business or all or substantially all of its Assets, except for
the sale, lease or licensing of property or Assets of the Company in the
Company’s Ordinary Course of Business.  For purposes of this Agreement, the term
“Change of Control” shall mean any sale, conveyance, assignment or other
transfer, directly or indirectly, of any ownership interest of the Company which
results in any change in the identity of the individuals or entities previously
having the power to direct, or cause the direction of, the management and
policies of the Company, or the grant of a security interest in any ownership
interest of any Person directly or indirectly controlling the Company, which
could result in a change in the identity of the individuals or entities
previously having the power to direct, or cause the direction of, the management
and policies of the Company.

(f)           Distributions; Restricted Payments; Change in Management.  So long
as Buyer owns, legally or beneficially, any of the Debentures, the Company shall
not, either directly or indirectly: (i) purchase or redeem any shares of its
capital stock; (ii) declare or pay any dividends or distributions, whether in
cash or otherwise, or set aside any funds for any such purpose; (iii) make any
distribution to its shareholders, make any distribution of its property or
Assets or make any loans, advances or extensions of credit to, or investments
in, any Person, including, without limitation, any Affiliates of the Company, or
the Company’s officers, directors, employees or Material Shareholders; (iv) pay
any outstanding indebtedness of the Company, except for indebtedness and other
Obligations permitted hereunder; (v)  increase the annual salary paid to any
officers or directors of the Company as of the Effective Date, unless any such
increase is part of a written employment contract with any such officers entered
into prior to the Effective Date, a copy of which has been delivered to and
approved by the Buyer; or (vi) add, replace, remove, or otherwise change any
officers or other senior management positions of the Company from the officers
and other senior management positions existing as of the Effective Date, unless
first approved by Buyer in writing, which approval may be granted or withheld or
conditioned by Buyer in its sole and absolute discretion.

 
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(g)           Use of Proceeds.  The Company shall not use any portion of the
proceeds of the Debentures, either directly or indirectly, for any of the
following purposes: (i) to make any payment towards any indebtedness or other
Obligations of the Company; (ii) to pay any Taxes of any nature or kind that may
be due by the Company; or (iii) to pay any Obligations of any nature or kind due
or owing to any officers, directors, employees, or Material Shareholders of the
Company, other than salaries payable in the Company’s Ordinary Course of
Business.  The Company covenants and agrees to only use any portion of the
proceeds of the purchase and sale of the Debentures for the purposes set forth
in a “Use of Proceeds Confirmation” to be executed by the Company on the
Effective Date, unless the Company obtains the prior written consent of the
Buyer to use such proceeds for any other purpose, which consent may be granted
or withheld or conditioned by Buyer in its sole and absolute discretion.

(h)           Business Activities; Change of Legal Status and Organizational
Documents.  The Company shall not: (i) engage in any line of business other than
the businesses engaged in as of the Effective Date and business reasonably
related thereto; (ii) change its name, organizational identification number (if
applicable), its type of organization, its jurisdiction of organization or other
legal structure; or (iii) permit its Certificate of Incorporation, Bylaws or
other organizational documents to be amended or modified in any way which could
reasonably be expected to have a Material Adverse Effect.

(i)           Transactions with Affiliates.  The Company shall not enter into
any transaction with any of its Affiliates, officers, directors, employees,
Material Shareholders or other insiders, except in the Company’s Ordinary Course
of Business and upon fair and reasonable terms that are no less favorable to the
Company than it would obtain in a comparable arm’s length transaction with a
Person not an Affiliate of the Company.

(j)           Bank Accounts.  The Company shall not maintain any bank, deposit,
credit card payment processing accounts, or other accounts with any financial
institution, or any other Person, other than the Company’s accounts listed in
the attached Schedule 6.21.  Specifically, the Company may not change, modify,
close or otherwise affect any of the accounts listed in Schedule 6.21, without
Buyer’s prior written approval, which approval may be withheld or conditioned in
Buyer’s sole and absolute discretion.

7.2           Affirmative Covenants.

(a)           Corporate Existence.  The Company shall at all times preserve and
maintain its: (i) existence and good standing in the jurisdiction of its
organization; and (ii) its qualification to do business and good standing in
each jurisdiction where the nature of its business makes such qualification
necessary, and shall at all times continue as a going concern in the business
which the Company is presently conducting.

 
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(b)           Tax Liabilities.  The Company shall at all times pay and discharge
all Taxes upon, and all Claims (including claims for labor, materials and
supplies) against the Company or any of its properties or Assets, before the
same shall become delinquent and before penalties accrue thereon, unless and to
the extent that the same are being contested in good faith by appropriate
proceedings and for which adequate reserves in accordance with GAAP are being
maintained.

(c)           Notice of Proceedings.  The Company shall, promptly, but not more
than five (5) days after knowledge thereof shall have come to the attention of
any officer of the Company, give written notice to the Buyer of all threatened
or pending Proceedings before any Governmental Authority or otherwise affecting
the Company or any of its Assets.

(d)           Material Adverse Effect.  The Company shall, promptly, but not
more than five (5) days after knowledge thereof shall have come to the attention
of any officer of the Company, give written notice to the Buyer of any event,
circumstance, fact or other matter that could in any way have or be reasonably
expected to have a Material Adverse Effect.

(e)           Notice of Default.  The Company shall, promptly, but not more than
five (5) days after the commencement thereof, give notice to the Buyer in
writing of the occurrence of any “Event of Default” (as such term is defined in
any of the Transaction Documents) or of any event which, with the lapse of time,
the giving of notice or both, would constitute an Event of Default hereunder or
under any other Transaction Documents.

(f)           Maintain Property.  The Company shall at all times maintain,
preserve and keep all of its Assets in good repair, working order and condition,
normal wear and tear excepted, and shall from time to time, as the Company deems
appropriate in its reasonable judgment, make all needful and proper repairs,
renewals, replacements, and additions thereto so that at all times the
efficiency thereof shall be fully preserved and maintained.  The Company shall
permit Buyer to examine and inspect such Assets at all reasonable times upon
reasonable notice during business hours.  During the continuance of any Event of
Default hereunder or under any Transaction Documents, the Buyer shall, at the
Company’s expense, have the right to make additional inspections without
providing advance notice.

(g)           Maintain Insurance.  The Company shall at all times insure and
keep insured with insurance companies acceptable to Buyer, all insurable
property owned by the Company which is of a character usually insured by
companies similarly situated and operating like properties, against loss or
damage from environmental, fire and such other hazards or risks as are
customarily insured against by companies similarly situated and operating like
properties; and shall similarly insure employers’, public and professional
liability risks.  Prior to the Effective Date, the Company shall deliver to the
Buyer a certificate setting forth in summary form the nature and extent of the
insurance maintained pursuant to this Section.  All such policies of insurance
must be satisfactory to Buyer in relation to the amount and term of the
Debentures and type and value of the Assets of the Company, shall identify Buyer
as sole/lender’s loss payee and as an additional insured.  In the event the
Company fails to provide Buyer with evidence of the insurance coverage required
by this Section or at any time hereafter shall fail to obtain or maintain any of
the policies of insurance required above, or to pay any premium in whole or in
part relating thereto, then the Buyer, without waiving or releasing any
obligation or default by the Company hereunder, may at any time (but shall be
under no obligation to so act), obtain and maintain such policies of insurance
and pay such premium and take any other action with respect thereto, which Buyer
deems advisable.  This insurance coverage: (i) may, but need not, protect the
Company’s interest in such property; and (ii) may not pay any claim made by, or
against, the Company in connection with such property.  The Company may later
request that the Buyer cancel any such insurance purchased by Buyer, but only
after providing Buyer with evidence that the insurance coverage required by this
Section is in force.  The costs of such insurance obtained by Buyer, through and
including the effective date such insurance coverage is canceled or expires,
shall be payable on demand by the Company to Buyer, together with interest at
the highest non-usurious rate permitted by law on such amounts until repaid and
any other charges by Buyer in connection with the placement of such
insurance.  The costs of such insurance, which may be greater than the cost of
insurance which the Company may be able to obtain on its own, together with
interest thereon at the highest non-usurious rate permitted by Law and any other
charges incurred by Buyer in connection with the placement of such insurance may
be added to the total Obligations due and owing by the Company hereunder and
under the Debentures to the extent not paid by the Company.

 
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(h)           ERISA Liabilities; Employee Plans.  The Company shall: (i) keep in
full force and effect any and all Employee Plans which are presently in
existence or may, from time to time, come into existence under ERISA, and not
withdraw from any such Employee Plans, unless such withdrawal can be effected or
such Employee Plans can be terminated without liability to the Company; (ii)
make contributions to all of such Employee Plans in a timely manner and in a
sufficient amount to comply with the standards of ERISA, including the minimum
funding standards of ERISA; (iii) comply with all material requirements of ERISA
which relate to such Employee Plans; (iv) notify Buyer immediately upon receipt
by the Company of any notice concerning the imposition of any withdrawal
liability or of the institution of any Proceeding or other action which may
result in the termination of any such Employee Plans or the appointment of a
trustee to administer such Employee Plans; (v) promptly advise Buyer of the
occurrence of any “Reportable Event” or “Prohibited Transaction” (as such terms
are defined in ERISA), with respect to any such Employee Plans; and (vi) amend
any Employee Plan that is intended to be qualified within the meaning of Section
401 of the Internal Revenue Code of 1986 to the extent necessary to keep the
Employee Plan qualified, and to cause the Employee Plan to be administered and
operated in a manner that does not cause the Employee Plan to lose its qualified
status.

(i)           Reporting Status; Listing.  So long as Buyer owns, legally or
beneficially, any of the Securities, the Company shall: (i) file in a timely
manner all reports required to be filed under the Securities Act, the Exchange
Act or any securities Laws and regulations thereof applicable to the Company of
any state of the United States, or by the rules and regulations of the Principal
Trading Market, and, to provide a copy thereof to the Buyer promptly after such
filing; (ii) not terminate its status as an issuer required to file reports
under the Exchange Act even if the Exchange Act or the rules and regulations
thereunder would otherwise permit such termination; (iii) if required by the
rules and regulations of the Principal Trading Market, promptly secure the
listing of the Advisory Fee Shares or any other shares of Common Stock issuable
to Buyer under any of the Transaction Documents upon the Principal Trading
Market (subject to official notice of issuance) and, take all reasonable action
under its control to maintain the continued listing, quotation and trading of
its Common Stock (including, without limitation, the Advisory Fee Shares or any
other shares of Common Stock issuable to Buyer under any of the Transaction
Documents) on the Principal Trading Market, and the Company shall comply in all
respects with the Company’s reporting, filing and other Obligations under the
bylaws or rules of the Principal Trading Market, the Financial Industry
Regulatory Authority, Inc. and such other Governmental Authorities, as
applicable. The Company shall promptly provide to Buyer copies of any notices it
receives from the SEC or any Principal Trading Market, to the extent any such
notices could in any way have or be reasonably expected to have a Material
Adverse Effect.

 
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(j)           Rule 144.  With a view to making available to Buyer the benefits
of Rule 144 under the Securities Act (“Rule 144”), or any similar rule or
regulation of the SEC that may at any time permit Buyer to sell the Advisory Fee
Shares or other shares of Common Stock issuable to Buyer under any Transaction
Documents to the public without registration, the Company represents and
warrants that: (i) the Company is, and has been for a period of at least ninety
(90) days immediately preceding the date hereof, subject to the reporting
requirements of Section 13 or 15(d) of the Exchange Act; (ii) the Company has
filed all required reports under Section 13 or 15(d) of the Exchange Act, as
applicable, during the twelve (12) months preceding the First Closing Date (or
for such shorter period that the Company was required to file such reports); and
(iii) the Company is not an issuer defined as a “Shell Company” (as hereinafter
defined).  For the purposes hereof, the term “Shell Company” shall mean an
issuer that meets such a description as defined under Rule 144.  In addition, so
long as Buyer owns, legally or beneficially, any securities of the Company, the
Company shall, at its sole expense:

(i)           Make, keep and ensure that adequate current public information
with respect to the Company, as required in accordance with Rule 144, is
publicly available;

(ii)           furnish to the Buyer, promptly upon reasonable request: (A) a
written statement by the Company that it has complied with the reporting
requirements of Rule 144, the Securities Act and the Exchange Act; and (b) such
other information as may be reasonably requested by Buyer to permit the Buyer to
sell any of the Advisory Fee Shares or other shares of Common Stock acquired
hereunder or under any other Transaction Documents pursuant to Rule 144 without
limitation or restriction; and

(iii)           promptly at the request of Buyer, give the Company’s transfer
agent (the “Transfer Agent”) instructions to the effect that, upon the Transfer
Agent’s receipt from Buyer of a certificate (a “Rule 144 Certificate”)
certifying that Buyer’s holding period (as determined in accordance with the
provisions of Rule 144) for any portion of the Advisory Fee Shares or shares of
Common Stock issuable under any Transaction Document which Buyer proposes to
sell (or any portion of such shares which Buyer is not presently selling, but
for which Buyer desires to remove any restrictive legends applicable thereto)
(the “Securities Being Sold”) is not less than six (6) months, and receipt by
the Transfer Agent of the “Rule 144 Opinion” (as hereinafter defined) from the
Company or its counsel (or from Buyer and its counsel as permitted below), the
Transfer Agent is to effect the transfer (or issuance of a new certificate
without restrictive legends, if applicable) of the Securities Being Sold and
issue to Buyer or transferee(s) thereof one or more stock certificates
representing the transferred (or re-issued) Securities Being Sold without any
restrictive legend and without recording any restrictions on the transferability
of such shares on the Transfer Agent’s books and records.  In this regard, upon
Buyer’s request, the Company shall have an affirmative obligation to cause its
counsel to promptly issue to the Transfer Agent a legal opinion providing that,
based on the Rule 144 Certificate, the Securities Being Sold may be sold
pursuant to the provisions of Rule 144, even in the absence of an effective
registration statement, or re-issued without any restrictive legends pursuant to
the provisions of Rule 144, even in the absence of an effective registration
statement (the “Rule 144 Opinion”). If the Transfer Agent requires any
additional documentation in connection with any proposed transfer (or
re-issuance) by Buyer of any Securities Being Sold, the Company shall promptly
deliver or cause to be delivered to the Transfer Agent or to any other Person,
all such additional documentation as may be necessary to effectuate the transfer
(or re-issuance) of the Securities Being Sold and the issuance of an unlegended
certificate to any such Buyer or any transferee thereof, all at the Company’s
expense.  Any and all fees, charges or expenses, including, without limitation,
attorneys’ fees and costs, incurred by Buyer in connection with issuance of any
such shares, or the removal of any restrictive legends thereon, or the transfer
of any such shares to any assignee of Buyer, shall be paid by the Company, and
if not paid by the Company, the Buyer may, but shall not be required to, pay any
such fees, charges or expenses, and the amount thereof, together with interest
thereon at the highest non-usurious rate permitted by law, from the date of
outlay, until paid in full, shall be due and payable by the Company to Buyer
immediately upon demand therefor, and all such amounts shall be additional
Obligations of the company to Buyer secured under the Transaction Documents.  In
the event that the Company and/or its counsel refuses or fails for any reason to
render the Rule 144 Opinion or any other documents, certificates or instructions
required to effectuate the transfer (or re-issuance) of the Securities Being
Sold and the issuance of an unlegended certificate to any such Buyer or any
transferee thereof, then: (A) to the extent the Securities Being Sold could be
lawfully transferred (or re-issued) without restrictions under applicable laws,
Company’s failure to promptly provide the Rule 144 Opinion or any other
documents, certificates or instructions required to effectuate the transfer (or
re-issuance) of the Securities Being Sold and the issuance of an unlegended
certificate to any such Buyer or any transferee thereof shall be an immediate
Event of Default under this Agreement and all other Transaction Documents; and
(B) the Company hereby agrees and acknowledges that Buyer is hereby irrevocably
and expressly authorized to have counsel to Buyer render any and all opinions
and other certificates or instruments which may be required for purposes of
effectuating the transfer (or re-issuance) of the Securities Being Sold and the
issuance of an unlegended certificate to any such Buyer or any transferee
thereof, and the Company hereby irrevocably authorizes and directs the Transfer
Agent to, without any further confirmation or instructions from the Company,
transfer or re-issue any such Securities Being Sold as instructed by Buyer and
its counsel.

 
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(k)           Matters With Respect to Securities.

(i)           Issuance of Conversion Shares.  The parties hereto acknowledge
that pursuant to the terms of the Debentures, Buyer has the right, at its
discretion, to convert amounts due under the Debentures into Common Stock in
accordance with the terms of the Debentures.  In the event, for any reason, the
Company fails to issue, or cause its Transfer Agent to issue, any portion of the
Common Stock issuable upon conversion of the Debentures (the “Conversion
Shares”) to Buyer in connection with the exercise by Buyer of any of its
conversion rights under the Debentures, then the parties hereto acknowledge that
Buyer shall irrevocably be entitled to deliver to the Transfer Agent, on behalf
of itself and the Company, a “Conversion Notice” (as defined in the Debentures)
requesting the issuance of the Conversion Shares then issuable in accordance
with the terms of the Debentures, and the Transfer Agent, provided they are the
acting transfer agent for the Company at the time, shall, and the Company hereby
irrevocably authorizes and directs the Transfer Agent to, without any further
confirmation or instructions from the Company, issue the Conversion Shares
applicable to the Conversion Notice then being exercised, and surrender to a
nationally recognized overnight courier for delivery to Buyer at the address
specified in the Conversion Notice, a certificate of the Common Stock of the
Company, registered in the name of Buyer or its nominee, for the number of
Conversion Shares to which Buyer shall be then entitled under the Debentures, as
set forth in the Conversion Notice.

(ii)           Issuance of Additional Common Stock Under Section 7.5.  The
parties hereto acknowledge that pursuant to Section 7.5 below, the Company has
agreed to issue, simultaneously with the execution of this Agreement, and
possibly in the future, certain shares of the Company’s Common Stock in
accordance with the terms of Section 7.5 below.  In the event, for any reason,
the Company fails to issue, or cause its Transfer Agent to issue, any portion of
the Common Stock issuable to Buyer under Section 7.5, either now or in the
future, then the parties hereto acknowledge that Buyer shall irrevocably be
entitled to deliver to the Transfer Agent, on behalf of itself and the Company,
a written instruction requesting the issuance of the shares of Common Stock then
issuable in accordance with Section 7.5 below, and the Transfer Agent, provided
they are the acting transfer agent for the Company at the time, shall, and the
Company hereby irrevocably authorizes and directs the Transfer Agent to, without
any further confirmation or instructions from the Company, issue such shares of
the Company’s Common Stock as directed by Buyer, and surrender to a nationally
recognized overnight courier for delivery to Buyer at the address specified in
the Buyer’s notice, a certificate of the Common Stock of the Company, registered
in the name of Buyer or its nominee, for the number of shares of Common Stock
issuable to Buyer in accordance with Section 7.5.

 
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(iii)           Removal of Restrictive Legends.  In the event that Buyer has any
shares of the Company’s Common Stock bearing any restrictive legends, and Buyer,
through its counsel or other representatives, submits to the Transfer Agent any
such shares for the removal of the restrictive legends thereon, whether in
connection with a sale of such shares pursuant to any exemption to the
registration requirements under the Securities Act, or otherwise, and the
Company and or its counsel refuses or fails for any reason to render an opinion
of counsel or any other documents or certificates required for the removal of
the restrictive legends, then the Company hereby agrees and acknowledges that
Buyer is hereby irrevocably and expressly authorized to have counsel to Buyer
render any and all opinions and other certificates or instruments which may be
required for purposes of removing such restrictive legends, and the Company
hereby irrevocably authorizes and directs the Transfer Agent to, without any
further confirmation or instructions from the Company, issue any such shares
without restrictive legends as instructed by Buyer, and surrender to a common
carrier for overnight delivery to the address as specified by Buyer,
certificates, registered in the name of Buyer or its designees or nominees,
representing the shares of Common Stock to which Buyer is entitled, without any
restrictive legends and otherwise freely transferable on the books and records
of the Company.

(iv)           Authorized Agent of the Company.  The Company hereby irrevocably
appoints the Buyer and its counsel and its representatives, each as the
Company’s duly authorized agent and attorney-in-fact for the Company for the
purposes of authorizing and instructing the Transfer Agent to process issuances,
transfers and legend removals upon instructions from Buyer, or any counsel or
representatives of Buyer, as specifically contemplated herein.  The
authorization and power of attorney granted hereby is coupled with an interest
and is irrevocable so long as any obligations of the Company under Debentures
remain outstanding, and so long as the Buyer owns or has the right to receive,
any shares of the Company’s Common Stock hereunder or under any Transaction
Documents.  In this regard, the Company hereby confirms to the Transfer Agent
and the Buyer that it can NOT and will NOT give instructions, including stop
orders or otherwise, inconsistent with the terms of this Agreement with regard
to the matters contemplated herein, and that the Buyer shall have the absolute
right to provide a copy of this Agreement to the Transfer Agent as evidence of
the Company’s irrevocable authority for Buyer and Transfer Agent to process
issuances, transfers and legend removals upon instructions from Buyer, or any
counsel or representatives of Buyer, as specifically contemplated herein,
without any further instructions, orders or confirmations from the Company.

(v)           Injunction and Specific Performance.  The Company specifically
acknowledges and agrees that in the event of a breach or threatened breach by
the Company of any provision of this Section 7.2(k), the Buyer will be
irreparably damaged and that damages at law would be an inadequate remedy if
this Agreement were not specifically enforced.  Therefore, in the event of a
breach or threatened breach of any provision of this Section 7.2(k) by the
Company, the Buyer shall be entitled to obtain, in addition to all other rights
or remedies Buyer may have, at law or in equity, an injunction restraining such
breach, without being required to show any actual damage or to post any bond or
other security, and/or to a decree for specific performance of the provisions of
this Section 7.2(k).

 
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(l)           Continued Due Diligence/Field Audits.  The Company acknowledges
that during the term of this Agreement, Buyer and its agents and representatives
undertake ongoing and continuing due diligence reviews of the Company and its
business and operations.  Such ongoing due diligence reviews may include, and
the Company does hereby agree to allow Buyer, to conduct site visits and field
examinations of the office locations of the Company and all of its Subsidiaries,
and the Assets and records of each of them, the results of which must be
satisfactory to Buyer in Buyer’s sole and absolute discretion.  In this regard,
in order to cover Buyer’s expenses of the ongoing due diligence reviews and any
site visits or field examinations which Buyer may undertake from time to time
while this Agreement is in effect, the Company shall pay to Buyer, within five
(5) Business Days after receipt of an invoice or demand therefor from Buyer, a
fee of up to $8,000 per year (based on expected filed audits and ongoing due
diligence of $2,000 per quarter) to cover such ongoing expenses.  Failure to pay
such fee as and when required shall be deemed an Event of Default under this
Agreement and all other Transaction Documents.  The foregoing notwithstanding,
from and after the occurrence of an Event of Default or any event which with
notice, lapse of time or both, would become an Event of Default, Buyer may
conduct site visits, field examinations and other ongoing reviews of the
Company’s records, Assets and operations at any time, in its sole discretion,
without any limitations in terms of number of site visits or examinations and
without being limited to the fee hereby contemplated, all at the sole expense of
the Company.

7.3           Reporting Requirements.  The Company agrees as follows:

(a)           Financial Statements.  The Company shall at all times maintain a
system of accounting capable of producing its individual and consolidated (if
applicable) financial statements in compliance with GAAP (provided that monthly
financial statements shall not be required to have footnote disclosure, are
subject to normal year-end adjustments and need not be consolidated), and shall
furnish to the Buyer or its authorized representatives such information
regarding the business affairs, operations and financial condition of the
Company as Buyer may from time to time request or require, including:

(i)           As soon as available, and in any event, within ninety (90) days
after the close of each fiscal year, a copy of the annual audited financial
statements of the Company, including balance sheet, statement of income and
retained earnings, statement of cash flows for the fiscal year then ended, in
reasonable detail, prepared and reviewed by an independent certified public
accountant reasonably acceptable to Buyer, containing an unqualified opinion of
such accountant;

(ii)           as soon as available, and in any event, within sixty (60) days
after the close of each fiscal quarter, a copy of the quarterly financial
statements of the Company, including balance sheet, statement of income and
retained earnings, statement of cash flows for the fiscal year then ended, in
reasonable detail, prepared and certified as accurate in all material respects
by the CEO or CFO of the Company;

(iii)           as soon as available, and in any event, within thirty (30) days
following the end of each calendar month, a copy of the financial statements of
the Company regarding such month, including balance sheet, statement of income
and retained earnings, statement of cash flows for the month then ended, in
reasonable detail, prepared and certified as accurate in all material respects
by the CEO or CFO of the Company.

 
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No change with respect to the Company’s accounting principles shall be made by
the Company without giving prior notification to Buyer. The Company represents
and warrants to Buyer that the financial statements delivered to Buyer at or
prior to the execution and delivery of this Agreement and to be delivered at all
times thereafter accurately reflect and will accurately reflect the financial
condition of the Company in all material respects. Buyer shall have the right at
all times (and on reasonable notice so long as there then does not exist any
Event of Default) during business hours to inspect the books and records of the
Company and make extracts therefrom.  The Company shall at all times comply with
all reporting requirements of the SEC to the extent applicable.
 
(b)           Additional Reporting Requirements. The Company shall provide the
following reports and statements to Buyer as follows:

(i)           Income Projections; Variance.  On the Effective Date, the Company
shall provide to Buyer an income statement projection showing, in reasonable
detail, the Company’s income statement projections for the twelve (12) calendar
months following the Effective Date (the “Income Projections”).  In addition, on
the first (1st) day of every calendar month after the Effective Date, the
Company shall provide to Buyer a report comparing the Income Projections to
actual results.  Any variance in the Income Projections to actual results that
is more than ten percent (10%) (either above or below) will require the Company
to submit to Buyer written explanations as to the nature and circumstances for
the variance.

(ii)           Use of Proceeds; Variance.  On the first (1st) day of every
calendar month after the Effective Date, the Company shall provide to Buyer a
report comparing the use of the proceeds from the sale of Debentures set forth
in the Use of Proceeds Confirmation, with the actual use of such proceeds.  Any
variance in the actual use of such proceeds from the amounts set forth in the
approved Use of Proceeds Confirmation will require the Company to submit to
Buyer written explanations as to the nature and circumstances for the variance.

(iii)           Bank Statements.  The Company shall submit to Buyer true and
correct copies of all bank statements received by the Company within five (5)
days after the Company’s receipt thereof from its bank.

(iv)           Interim Reports.  Promptly upon receipt thereof, the Company
shall provide to Buyer copies of interim and supplemental reports, if any,
submitted to the Company by independent accountants in connection with any
interim audit or review of the books of the Company.

(v)           Aged Accounts/Payables Schedules.  The Company shall, on the first
(1st) day of each and every calendar month, deliver to Buyer an aged schedule of
the accounts receivable of the Company, listing the name and amount due from
each Person and showing the aggregate amounts due from: (i) 0-30 days; (ii)
31-60 days; (iii) 61-90 days; (iv) 91-120 days; and (v) more than 120 days, and
certified as accurate by the CEO or CFO of the Company.  The Company shall, on
the first (1st) day of each and every calendar month, deliver to Buyer an aged
schedule of the accounts payable of the Company, listing the name and amount due
to each creditor and showing the aggregate amounts due from: (v) 0-30 days; (w)
31-60 days; (x) 61-90 days;  (y) 91-120 days; and (z) more than 120 days, and
certified as accurate by the CEO or CFO of the Company.

(c)           Failure to Provide Reports.  If at any time during the term of
this Agreement, the Company shall fail to timely provide any reports required to
be provided by the Company to Buyer under this Agreement or any other
Transaction Documents, in addition to all other rights and remedies that Buyer
may have under this Agreement and the other Transaction Documents, Buyer shall
have the right to require, at each instance of any such failure, upon written
notice to Company, that the Company redeem Advisory Fee Shares in an amount
equal to 8.33% of the Advisory Fee, which cash redemption payment shall be due
and payable by wire transfer of U.S. dollars to an account designated by Buyer
within five (5) Business Days from the date the Buyer delivers such redemption
notice to the Company.

 
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(d)           Covenant Compliance. The Company shall, within thirty (30) days
after the end of each calendar month, deliver to Buyer a Compliance Certificate
in the form attached hereto as Exhibit “B”, confirming compliance by the Company
with the covenants therein, and certified as accurate by the CEO or CFO of the
Company.

7.4           Fees and Expenses.

(a)           Transaction Fees.  The Company agrees to pay to Buyer a
transaction advisory fee equal to four percent (4%) of the amount of the
Debentures purchased by Buyer at the First Closing, which fee shall be due and
payable on the Effective Date and withheld from the gross purchase price paid by
Buyer for the Debentures.  In the event of any Additional Closings, the Company
shall pay to Buyer a transaction advisory fee equal to two percent (2%) of the
amount of the Debentures purchased by Buyer at any such Additional Closings,
which fee shall be due and payable upon such Additional Closing and withheld
from the gross purchase price paid by Buyer for the Debentures at such
Additional Closing.

(b)           Due Diligence Fees.  The Company agrees to pay to the Buyer a due
diligence fee equal to Two Thousand Five Hundred and No/100 Dollars ($2,500.00),
which shall be due and payable in full on the Effective Date, or any remaining
portion thereof shall be due and payable on the Effective Date if a portion of
such fee was paid upon the execution of any term sheet related to this
Agreement.

(c)           Document Review and Legal Fees.  The Company agrees to pay to the
Buyer or its counsel a document review and legal fee equal to Twelve Thousand
Five Hundred and No/100 Dollars ($12,500.00), which shall be due and payable in
full on the Effective Date, or any remaining portion thereof shall be due and
payable on the Effective Date if a portion of such fee was paid upon the
execution of any term sheet related to this Agreement.  The Company also agrees
to be responsible for the prompt payment of all legal fees and expenses of the
Company and its own counsel and other professionals incurred by the Company in
connection with the negotiation and execution of this Agreement and the
Transaction Documents.

(d)           Other Fees.  The Company also agrees to pay to the Buyer (or any
designee of the Buyer), upon demand, or to otherwise be responsible for the
payment of, any and all other costs, fees and expenses, including the reasonable
fees, costs, expenses and disbursements of counsel for the Buyer and of any
experts and agents, which the Buyer may incur or which may otherwise be due and
payable in connection with: (i) the preparation, negotiation, execution,
delivery, recordation, administration, amendment, subordination, waiver or other
modification or termination of this Agreement or any other Transaction
Documents; (ii) any documentary stamp taxes, intangibles taxes, recording fees,
filing fees, or other similar taxes, fees or charges imposed by or due to any
Governmental Authority in connection with this Agreement or any other
Transaction Documents; (iii) the exercise or enforcement of any of the rights of
the Buyer under this Agreement or the Transaction Documents; or (iv) the failure
by the Company to perform or observe any of the provisions of this Agreement or
any of the Transaction Documents.  Included in the foregoing shall be the amount
of all expenses paid or incurred by Buyer in consulting with counsel concerning
any of its rights under this Agreement or any other Transaction Document or
under applicable law.  To the extent any such costs, fees, charges, taxes or
expenses are incurred prior to the funding of proceeds from the Closing, same
shall be paid directly from the proceeds of the Closing.  All such costs and
expenses, if not so immediately paid when due or upon demand thereof, shall bear
interest from the date of outlay until paid, at the highest rate set forth in
the Debenture, or if none is so stated, the highest rate allowed by law.  All of
such costs and expenses shall be additional Obligations of the Company to Buyer
secured under the Transaction Documents.  The provisions of this Subsection
shall survive the termination of this Agreement.

 
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7.5           Advisory Fee Shares.

(a)           Share Issuance.  In consideration of advisory services provided by
Buyer to the Company prior to the Effective Date, the Company shall pay to Buyer
a fee equal to $100,000.00 (the “Advisory Fee”).  The Advisory Fee shall be
initially paid by the issuance to Buyer of restricted shares of the Company’s
Common Stock (the “Advisory Fee Shares”) in accordance with the terms and
provisions of this Section.  For purposes of determining the number of shares
issuable to Buyer under this Section 7.5(a), the Company’s Common Stock shall be
valued at the average of the volume weighted average price for the Common Stock
for the five (5) Business Days immediately prior to the Effective Date (the
“Valuation Date”), as reported by Bloomberg or such other reporting service
acceptable to Buyer (the “VWAP”).  The Buyer shall confirm to the Company in
writing, the VWAP for the Common Stock as of the Valuation Date, and the Company
shall issue to Buyer, on the First Closing Date, a number of Advisory Fee Shares
up to two hundred percent (200%) of the Advisory Fee (the actual percentage to
be determined by Buyer, so as to not receive Advisory Fee Shares which, when
added to other shares of Common Stock owned by Buyer, exceed 4.99% of the number
of shares of the Company’s Common Stock outstanding immediately after giving
effect to the issuance of the Advisory Fee Shares), based on such VWAP as of the
Valuation Date.  On the Effective Date, the Company shall instruct its Transfer
Agent to issue certificates representing the Advisory Fee Shares issuable to the
Buyer hereunder, and shall cause its Transfer Agent to deliver such certificates
to Buyer within five (5) Business Days from the Effective Date.  In the event
such certificates representing the Advisory Fee Shares issuable hereunder shall
not be delivered to the Buyer within said five (5) Business Day period, same
shall be an immediate default under this Agreement and the other Transaction
Documents.  The Advisory Fee Shares, when issued, shall be deemed to be validly
issued, fully paid, and non-assessable shares of the Company’s Common Stock. The
Advisory Fee Shares shall be deemed fully earned as of the Effective Date,
regardless of the amount or number of Debentures purchased hereunder. 

 
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(b)           Adjustments.  It is the intention of the Company and Buyer that
the Buyer shall be able to sell the Advisory Fee Shares and generate net
proceeds (net of all brokerage commissions and other fees or charges payable by
Buyer in connection with the sale thereof) from such sale equal to the Advisory
Fee.  In this regard, the Buyer shall have the right to sell the Advisory Fee
Shares in the Principal Trading Market, or otherwise, at any time in accordance
with applicable securities laws.  After the earlier to occur of: (A) the sale of
all Advisory Fee Shares; or (B) Buyer receiving net proceeds from the sale of
the Advisory Fee Shares equal to the Advisory Fee, the Buyer shall deliver to
the Company a reconciliation statement showing the net proceeds actually
received by the Buyer from the sale of the Advisory Fee Shares (the “Sale
Reconciliation”).  If, as of the date of the delivery by Buyer of the Sale
Reconciliation, the Buyer has not realized and received net proceeds from the
sale of the Advisory Fee Shares equal to at least the Advisory Fee, as shown on
the Sale Reconciliation, then the Company shall immediately take all required
action necessary or required in order to cause the issuance of additional shares
of Common Stock to the Buyer in an amount sufficient such that, when sold and
the net proceeds thereof are added to the net proceeds from the sale of any of
the previously issued and sold Advisory Fee Shares, the Buyer shall have
received total net funds equal to the Advisory Fee.  If additional shares of
Common Stock are issued pursuant to the immediately preceding sentence, and
after the sale of such additional issued shares of Common Stock, the Buyer still
has not received net proceeds equal to at least the Advisory Fee, then the
Company shall again be required to immediately take all required action
necessary or required in order to cause the issuance of additional shares of
Common Stock to the Buyer as contemplated above, and such additional issuances
shall continue until the Buyer has received net proceeds from the sale of such
Common Stock equal to the Advisory Fee.  In the event the Buyer receives net
proceeds from the sale of Advisory Fee Shares equal to the Advisory Fee before
Buyer has sold all Advisory Fee Shares issued to Buyer hereunder, then the Buyer
shall return all such remaining Advisory Fee Shares to the Company.  In the
event additional Common Stock is required to be issued as outlined above, the
Company shall instruct its Transfer Agent to issue certificates representing
such additional shares of Common Stock to the Buyer immediately subsequent to
the Buyer’s notification to the Company that additional shares of Common Stock
are issuable hereunder, and the Company shall in any event cause its Transfer
Agent to deliver such certificates to Buyer within five (5) Business Days
following the date Buyer notifies the Company that additional shares of Common
Stock are to be issued hereunder.  In the event such certificates representing
such additional shares of Common Stock issuable hereunder shall not be delivered
to the Buyer within said five (5) Business Day period, same shall be an
immediate default under this Agreement and the Transaction
Documents.  Notwithstanding anything contained in this Section 7.5 to the
contrary, at any time on or prior to maturity date of the debentures purchased
at the First Closing, the Company shall have the right, at any time during such
period, to redeem any Advisory Fee Shares then in the Buyer’s possession for an
amount payable by the Company to Buyer in cleared U.S. dollars equal to the
Advisory Fee, less any net proceeds received by the Buyer from any previous
sales of Advisory Fee Shares.  Upon Buyer’s receipt of such cash payment in
accordance with the immediately preceding sentence, the Buyer shall return any
then remaining Advisory Fee Shares in its possession back to the Company.

(c)           Mandatory Redemption.  Notwithstanding anything contained in this
Agreement to the contrary, in the event the Buyer has not realized net proceeds
from the sale of Advisory Fee Shares equal to at least the Advisory Fee by a
date that is twelve (12) months from the Effective Date, then at any time
thereafter, the Buyer shall have the right, upon written notice to the Company,
to require that the Company redeem all Advisory Fee Shares then in Buyer’s
possession for U.S. dollars equal to the Advisory Fee, less any net proceeds
received by the Buyer from any previous sales of Advisory Fee Shares, if
any.  In the event such redemption notice is given by the Buyer, the Company
shall redeem the then remaining Advisory Fee Shares in Buyer’s possession for an
amount of cleared U.S. dollars equal to the Advisory Fee, less any net proceeds
received by the Buyer from any previous sales of Advisory Fee Shares, if any,
payable by wire transfer to an account designated by Buyer within five (5)
Business Days from the date the Buyer delivers such redemption notice to the
Company.

(d)           Fees Due Upon Purchase of Additional Debentures.  In the event the
Buyer purchases additional Debentures at any Additional Closings as permitted by
this Agreement, the Company agrees to pay additional advisory fees to the Buyer
through the issuance of additional Advisory Fee Shares in an amount to be
determined by the Buyer.

(e)           Surviving Obligations.  Notwithstanding anything contained to the
contrary in any Transaction Documents, the Company agrees and acknowledges that
notwithstanding the termination of this Agreement, or the payment in full of the
Debentures or any other Obligations of the Company hereunder or under any other
Transaction Documents, the Company’s Obligations under this Agreement and the
other Transaction Documents, and the Buyer’s Encumbrance on all Assets and
property of the Company, shall remain valid and effective and shall not be
released or terminated, until the Company has fully complied with all of its
Obligations with respect to payment of the Advisory Fee contemplated by this
Section 7.5, and the Buyer has generated and received net proceeds from the sale
of the Advisory Fee Shares (or otherwise received equivalent payment thereof in
cash as permitted hereunder) equal to the Advisory Fee.

 
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7.6           Share Reserve.  The Company shall take all action reasonably
necessary to at all times have authorized, and reserved for the purpose of
issuance, such number of shares of Common Stock as shall be necessary to effect
the issuance of the Conversion Shares and Advisory Fee Shares under this
Agreement or any other Transaction Documents (collectively, the “Share
Reserve”). The Company represents that it has sufficient authorized and unissued
shares of Common Stock available to create the Share Reserve after considering
all other commitments that may require the issuance of Common Stock. The Company
shall take all action reasonably necessary to at all times have authorized, and
reserved for the purpose of issuance, such number of shares of Common Stock as
shall be necessary to effect the full conversion of the Debentures and issuance
of all Advisory Fee Shares that may be issuable hereunder. If at any time the
Share Reserve is insufficient to effect the full conversion of the Debentures
and issuance of all Advisory Fee Shares that may be issuable hereunder, the
Company shall take all required measures to implement an increase of the Share
Reserve accordingly. If the Company does not have sufficient authorized and
unissued shares of Common Stock available to increase the Share Reserve, the
Company shall call and hold a special meeting of the shareholders within twenty
(20) business days of such occurrence, for the sole purpose of increasing the
number of shares authorized. The Company’s management shall recommend to the
shareholders to vote in favor of increasing the number of shares of Common Stock
authorized.

7.7           Prior Transaction.  On or about December 29, 2011, the Buyer made
a loan to the Company, which loan is evidenced by that certain Convertible
Promissory Note dated as of December 29, 2011 for an original principal amount
of $225,000 (the “Original Note”).  All obligations of the Company under the
Original Note were secured by a Security Agreement between the Company and Buyer
dated of even date with the Original Note (the “Original Security
Agreement”).  In addition, the Company and Buyer entered into a Committed Equity
Facility Agreement dated as of December 29, 2011, and a corresponding
Registration Rights Agreement dated as of December 29, 2011 (the “CEF
Agreements”).  The Original Note, the Original Security Agreement, the CEF
Agreements and all other documents executed in connection therewith are
sometimes hereinafter collectively referred to as the “Original
Agreements”).  The Company and Buyer desire to terminate the Original Agreements
and agree that certain obligations outstanding under the Original Agreements
shall be satisfied as set forth herein.  In that regard, the Company and the
Buyer hereby agree as follows:

(a)           Termination of Original Agreements.  Effective as of the
consummation of the First Closing, the Original Agreements are hereby deemed
terminated and of no further force or effect.

 
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(b)           Payment of Obligations.  The Company agrees and acknowledges that
it owes to the Buyer an amount equal to $80,000 in connection with the Original
Agreements (the “Past Due Fee”).  The Company and the Buyer agree that the Past
Due Fee shall be paid by the issuance to Buyer of unrestricted and freely
tradable shares of the Company’s Common Stock (the “Past Due Shares”) in
accordance with the terms and provisions of this Section.  For purposes of
determining the number of shares issuable to Buyer under this Section 7.7(b),
the Company’s Common Stock shall be valued at the VWAP on the Valuation Date in
the same manner as set forth in Section 7.5.  The Buyer shall confirm to the
Company in writing, the VWAP for the Common Stock as of the Valuation Date, and
the Company shall issue to Buyer, on the First Closing Date, a number of Past
Due Shares of up to two hundred percent (200%) of the Past Due Fee (the actual
percentage to be determined by Buyer, so as to not receive Past Due Shares
which, when added to other shares of Common Stock owned by Buyer, exceed 4.99%
of the number of shares of the Company’s Common Stock outstanding immediately
after giving effect to the issuance of the Past Due Shares), based on such VWAP
as of the Valuation Date.  On the Effective Date, the Company shall instruct its
Transfer Agent to issue certificates representing the Past Due Shares issuable
to the Buyer hereunder, and shall cause its Transfer Agent to deliver such
certificates to Buyer within five (5) Business Days from the Effective Date.  In
the event such certificates representing the Past Due Shares issuable hereunder
shall not be delivered to the Buyer within said five (5) Business Day period,
same shall be an immediate default under this Agreement and the other
Transaction Documents.  The Past Due Shares shall be freely tradable and shall
not contain any restrictive legends or other restrictions on the transferability
of such Past Due Shares.  The Past Due Shares, when issued, shall be deemed to
be validly issued, fully paid, and non-assessable shares of the Company’s Common
Stock. The Past Due Shares shall be deemed fully earned as of the Effective
Date, regardless of the amount or number of Debentures purchased hereunder. 

(c)           Adjustments.  It is the intention of the Company and Buyer that
the Buyer shall be able to sell the Past Due Shares and generate net proceeds
(net of all brokerage commissions and other fees or charges payable by Buyer in
connection with the sale thereof) from such sale equal to the Past Due Fee.  In
this regard, the Buyer shall have the right to sell the Past Due Shares in the
Principal Trading Market, or otherwise, at any time.  After the earlier to occur
of: (A) the sale of all Past Due Shares; or (B) Buyer receiving net proceeds
from the sale of the Past Due Shares equal to the Past Due Fee, the Buyer shall
deliver to the Company a Sale Reconciliation statement showing the net proceeds
actually received by the Buyer from the sale of the Past Due Shares.  If, as of
the date of the delivery by Buyer of the Sale Reconciliation, the Buyer has not
realized and received net proceeds from the sale of the Past Due Shares equal to
at least the Past Due Fee, as shown on the Sale Reconciliation, then the Company
shall immediately take all required action necessary or required in order to
cause the issuance of additional shares of Common Stock to the Buyer in an
amount sufficient such that, when sold and the net proceeds thereof are added to
the net proceeds from the sale of any of the previously issued and sold Past Due
Shares, the Buyer shall have received total net funds equal to the Past Due
Fee.  If additional shares of Common Stock are issued pursuant to the
immediately preceding sentence, and after the sale of such additional issued
shares of Common Stock, the Buyer still has not received net proceeds equal to
at least the Past Due Fee, then the Company shall again be required to
immediately take all required action necessary or required in order to cause the
issuance of additional shares of Common Stock to the Buyer as contemplated
above, and such additional issuances shall continue until the Buyer has received
net proceeds from the sale of such Common Stock equal to the Past Due Fee.  In
the event the Buyer receives net proceeds from the sale of Past Due Shares equal
to the Past Due Fee before Buyer has sold all Past Due Shares issued to Buyer
hereunder, then the Buyer shall return all such remaining Past Due Shares to the
Company.  In the event additional Common Stock is required to be issued as
outlined above, the Company shall instruct its Transfer Agent to issue
certificates representing such additional shares of Common Stock to the Buyer
immediately subsequent to the Buyer’s notification to the Company that
additional shares of Common Stock are issuable hereunder, and the Company shall
in any event cause its Transfer Agent to deliver such certificates to Buyer
within five (5) Business Days following the date Buyer notifies the Company that
additional shares of Common Stock are to be issued hereunder.  In the event such
certificates representing such additional shares of Common Stock issuable
hereunder shall not be delivered to the Buyer within said five (5) Business Day
period, same shall be an immediate default under this Agreement and the
Transaction Documents.  Notwithstanding anything contained in this Section 7.7
to the contrary, at any time on or prior to maturity date of the Debentures
purchased at the First Closing, the Company shall have the right, at any time
during such period, to redeem any Past Due Shares then in the Buyer’s possession
for an amount payable by the Company to Buyer in cleared U.S. dollars equal to
the Past Due Fee, less any net proceeds received by the Buyer from any previous
sales of Past Due Shares.  Upon Buyer’s receipt of such cash payment in
accordance with the immediately preceding sentence, the Buyer shall return any
then remaining Past Due Shares in its possession back to the Company.

 
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(d)           Mandatory Redemption.  Notwithstanding anything contained in this
Agreement to the contrary, in the event the Buyer has not realized net proceeds
from the sale of Past Due Shares equal to at least the Past Due Fee by a date
that is twelve (12) months from the Effective Date, then at any time thereafter,
the Buyer shall have the right, upon written notice to the Company, to require
that the Company redeem all Past Due Shares then in Buyer’s possession for U.S.
dollars equal to the Past Due Fee, less any net proceeds received by the Buyer
from any previous sales of Past Due Shares, if any.  In the event such
redemption notice is given by the Buyer, the Company shall redeem the then
remaining Past Due Shares in Buyer’s possession for an amount of cleared U.S.
dollars equal to the Past Due Fee, less any net proceeds received by the Buyer
from any previous sales of Past Due Shares, if any, payable by wire transfer to
an account designated by Buyer within five (5) Business Days from the date the
Buyer delivers such redemption notice to the Company.

(e)           Leak-Out Covenant.  Notwithstanding anything contained in this
Agreement to the contrary, so long as no Event of Default exists, and so long as
no event has occurred that, with the passage of time, the giving of notice, or
both, would constitute an Event of Default, the Buyer agrees that it shall not,
during any given calendar week, sell Past Due Shares in excess of twenty-five
percent (25%) of the average weekly volume of the Common Stock on the Principal
Trading Market over the immediately preceding calendar week, as reported by
Bloomberg.

(f)           Surviving Obligations.  Notwithstanding anything contained to the
contrary in any Transaction Documents, the Company agrees and acknowledges that
notwithstanding the termination of this Agreement, or the payment in full of the
Debentures or any other Obligations of the Company hereunder or under any other
Transaction Documents, the Company’s Obligations under this Agreement and the
other Transaction Documents, and the Buyer’s Encumbrance on all Assets and
property of the Company, shall remain valid and effective and shall not be
released or terminated, until the Company has fully complied with all of its
Obligations with respect to payment of the Past Due Fee contemplated by this
Section 7.7, and the Buyer has generated and received net proceeds from the sale
of the Past Due Shares (or otherwise received equivalent payment thereof in cash
as permitted hereunder) equal to the Past Due Fee.

(g)           Applicability of 7.2(k).  The terms and provisions of Section
7.2(k) above shall be applicable to the Past Due Shares and the issuance
thereof.

7.8           Withheld Funds.

 
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(a)           Escrow for DTC Opinion.  The Company and the Buyer hereby
acknowledge that the Company’s Common Stock is currently not eligible for
transfer or trading through the Deposit Trust Corporation’s Deposit Withdrawal
Agent Commission system (“DWAC”) system.  In that regard, at the First Closing,
the Buyer shall withhold from the proceeds of the Debentures, an amount equal to
$10,000.00 (the “DTC Withheld Amount”).  The DTC Withheld Amount shall be held
by David Kahan, P.A., as “Escrow Agent” hereunder, and shall only be released to
the Company upon Escrow Agent’s receipt of written authorization from Buyer,
confirming that Buyer has received evidence reasonably acceptable to Buyer, that
the Company’s Common Stock is eligible for transfer and trading through such
DWAC system.  If Buyer does not receive evidence reasonably acceptable to Buyer
that the Company’s Common Stock is eligible for transfer and trading through
such DWAC system by a date that is forty-five (45) days after the First Closing
Date, same shall be an Event of Default under this Agreement, and in any such
event, in addition to all other rights and remedies the Buyer may have at law or
in equity or under any of the Transaction Documents, the Buyer may, in its sole
discretion, authorize Escrow Agent to disburse the DTC Withheld Amount to Buyer
to be applied against the Company’s Obligations under this Agreement and the
Transaction Documents. The DTC Withheld Amount shall be additional security for
all Obligations of the Company to Buyer under this Agreement and all other
Transaction Documents, and be secured by the Transaction Documents.

(b)           Matters Relating to Escrow Agent.

(i)           The Escrow Agent undertakes to perform only such duties as are
expressly set forth herein and no implied duties or obligations shall be read
into this Agreement against the Escrow Agent.  Escrow Agent agrees to hold the
DTC Withheld Amount (the “Escrowed Property”) in a non-interest bearing account
and to release same only in accordance with the terms and conditions set forth
in this Agreement and only upon a written direction from Buyer.

(ii)           The Escrow Agent may act in reliance upon any writing or
instrument (including e-mail) or signature which it, in good faith, believes to
be genuine, may assume the validity and accuracy of any statement or assertion
contained in such a writing or instrument, and may assume that any Person
purporting to give any writing, notice, advice or instructions in connection
with the provisions hereof has been duly authorized to do so. The Escrow Agent
shall not be liable in any manner for the sufficiency or correctness as to form,
manner, and execution, or validity of any instrument deposited in this escrow or
given to Escrow Agent under this Agreement, nor as to the identity, authority,
or right of any Person executing the same; and its duties hereunder shall be
limited to the safekeeping of the Escrowed Property, and for the disposition of
the same in accordance with this Agreement.  Escrow Agent shall not be deemed to
have knowledge of any matter or thing unless and until Escrow Agent has actually
received written notice of such matter or thing and Escrow Agent shall not be
charged with any constructive notice whatsoever.

(iii)           Escrow Agent shall hold in escrow, pursuant to this Agreement,
the Escrowed Property actually delivered and received by Escrow Agent hereunder,
and Escrow Agent shall not be obligated to ascertain the existence of (or
initiate recovery of) any other property other than property actually received
by Escrow Agent.  If all or any portion of the Escrowed Property is in the form
of a check or in any other form other than cash, Escrow Agent shall deposit same
as required but shall not be liable for the nonpayment thereof, nor responsible
to enforce collection thereof.  Escrow Agent shall not be liable for failure of
any financial institution where the Escrowed Property is deposited.

 
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(iv)           In the event instructions from Buyer, the Company, or any other
Person would require Escrow Agent to expend any monies or to incur any cost,
Escrow Agent shall be entitled to refrain from taking any action until it
receives payment for such costs.  It is agreed that the duties of Escrow Agent
are purely ministerial in nature and shall be expressly limited to the
safekeeping of the Escrowed Property and for the disposition of same in
accordance with this Agreement.  The Company and Buyer, jointly and severally,
each hereby indemnifies Escrow Agent and holds it harmless from and against any
and all claims, actions, liabilities, costs and other expenses of any nature or
kind, which it may incur or with which it may be threatened, directly or
indirectly, including all attorneys’ fees and costs of litigation, arising from
or in any way connected with this Agreement or which may result from Escrow
Agent’s following of instructions from Buyer in accordance with this Agreement,
except those arising as a result of Escrow Agent’s gross negligence or willful
misconduct.  Escrow Agent shall be vested with a lien on all Escrowed Property
under the terms of this Agreement, for indemnification, attorneys’ fees, court
costs and all other costs and expenses arising from any such claims or expenses,
interpleader or otherwise, or other expenses, fees or charges of any character
or nature, which may be incurred by Escrow Agent by reason of disputes arising
between the Buyer and the Company, or any other Person, as to the correct
interpretation of this Agreement, and instructions given to Escrow Agent
hereunder, or otherwise, with the right of Escrow Agent, regardless of the
instruments aforesaid and without the necessity of instituting any proceeding,
to hold any property hereunder until and unless said additional expenses, fees
and charges shall be fully paid. Any fees and costs charged by the Escrow Agent
for serving hereunder shall be paid by the Company.  Upon any release of
Escrowed Property in accordance with this Agreement, the Company shall be
obligated to pay to Escrow Agent, any fees and costs reasonably incurred by
Escrow Agent in connection with any such release, and the Escrow Agent shall be
entitled to retain from any Escrowed Property otherwise due to Company in
accordance with this Section 7.8, any such fees and costs.

(v)           In the event Escrow Agent shall be uncertain as to its duties or
rights hereunder or shall receive instructions, claims or demands from Buyer,
the Company or from any other Person with respect to the Escrowed Property,
which, in Escrow Agent’s sole opinion, are in conflict with each other or with
any provision of this Agreement, Escrow Agent shall be entitled to refrain from
taking any action until it shall be directed otherwise in writing by Buyer and
the Company and said other Persons, if any, or by a final order or judgment of a
court of competent jurisdiction.  If any of the parties shall be in disagreement
about the interpretation of this Agreement, or about the rights and obligations,
or the propriety of any action contemplated by the Escrow Agent hereunder, the
Escrow Agent may, at its sole discretion, deposit the Escrowed Property with a
court having jurisdiction over this Agreement, and, upon notifying all parties
concerned of such action, all liability on the part of the Escrow Agent shall
fully cease and terminate. The Escrow Agent shall be indemnified by the Buyer
and the Company for all costs, including reasonable attorneys’ fees, in
connection with the aforesaid proceeding, and shall be fully protected in
suspending all or a part of its activities under this Agreement until a final
decision or other settlement in the proceeding is received.  In the event Escrow
Agent is joined as a party to a lawsuit by virtue of the fact that it is holding
the Escrowed Property, Escrow Agent shall, at its sole option, either: (i)
tender the Escrowed Property in its possession to the registry of the
appropriate court; or (ii) disburse the Escrowed Property in its possession in
accordance with the court’s ultimate disposition of the case, and Buyer and the
Company hereby, jointly and severally, indemnify and hold Escrow Agent harmless
from and against any damages or losses in connection therewith including, but
not limited to, reasonable attorneys’ fees and court costs at all trial and
appellate levels.

(vi)           The Escrow Agent may consult with counsel of its own choice (and
the costs of such counsel shall be paid by the Company and Buyer) and shall have
full and complete authorization and protection for any action taken or suffered
by it hereunder in good faith and in accordance with the opinion of such
counsel. The Escrow Agent shall not be liable for any mistakes of fact or error
of judgment, or for any actions or omissions of any kind, unless caused by its
willful misconduct or gross negligence.

(vii)           The Escrow Agent may resign upon ten (10) days’ written notice
to the parties in this Agreement.  If a successor Escrow Agent is not appointed
by the Buyer and Company within this ten (10) day period, the Escrow Agent may
petition a court of competent jurisdiction to name a successor.

 
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(viii)           Conflict Waiver. The Company hereby acknowledges that the
Escrow Agent is counsel to the Buyer in connection with the transactions
contemplated and referred herein. The Company agrees that in the event of any
dispute arising in connection with this Agreement or otherwise in connection
with any transaction or agreement contemplated and referred herein, the Escrow
Agent shall be permitted to continue to represent the Buyer and the Company will
not seek to disqualify such counsel and waives any objection the Company might
have with respect to the Escrow Agent acting as the Escrow Agent pursuant to
this Agreement.  The Buyer and the Company acknowledge and agree that nothing in
this Agreement shall prohibit Escrow Agent from: (i) serving in a similar
capacity on behalf of others; or (ii) acting in the capacity of attorneys for
one or more of the parties hereto in connection with any matter.

ARTICLE VIII
CONDITIONS PRECEDENT TO THE COMPANY’S OBLIGATIONS TO SELL

The obligation of the Company hereunder to issue and sell the Securities to the
Buyer at the Closings is subject to the satisfaction, at or before the
respective Closing Dates, of each of the following conditions, provided that
these conditions are for the Company’s sole benefit and may be waived by the
Company at any time in its sole discretion:

8.1           Buyer shall have executed the Transaction Documents and delivered
them to the Company.

8.2           The representations and warranties of the Buyer shall be true and
correct in all material respects as of the date when made and as of the Closing
Dates as though made at that time (except for representations and warranties
that speak as of a specific date), and the Buyer shall have performed, satisfied
and complied in all material respects with the covenants, agreements and
conditions required by this Agreement to be performed, satisfied or complied
with by the Buyer at or prior to the Closing Dates.

ARTICLE IX
CONDITIONS PRECEDENT TO THE BUYER’S OBLIGATIONS TO PURCHASE

The obligation of the Buyer hereunder to purchase the Debentures at the Closings
is subject to the satisfaction, at or before each applicable Closing Date, of
each of the following conditions (in addition to any other conditions precedent
elsewhere in this Agreement), provided that these conditions are for the Buyer’s
sole benefit and may be waived by the Buyer at any time in its sole discretion:

9.1           First Closing.  The obligation of the Buyer hereunder to purchase
the Debentures at the First Closing is subject to the satisfaction, at or before
the First Closing Date, of each of the following conditions (in addition to any
other conditions precedent elsewhere in this Agreement), provided that these
conditions are for the Buyer’s sole benefit and may be waived by the Buyer at
any time in its sole discretion:

(a)           The Company shall have executed and delivered the Transaction
Documents applicable to the First Closing and delivered the same to the Buyer.

 
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(b)           The representations and warranties of the Company shall be true
and correct in all material respects (except to the extent that any of such
representations and warranties are already qualified as to materiality in
Article VI above, in which case, such representations and warranties shall be
true and correct in all respects without further qualification) as of the date
when made and as of the First Closing Date as though made at that time (except
for representations and warranties that speak as of a specific date) and the
Company shall have performed, satisfied and complied in all material respects
with the covenants, agreements and conditions required by this Agreement to be
performed, satisfied or complied with by the Company at or prior to the First
Closing Date.

(c)           The Buyer shall have received an opinion of counsel from counsel
to the Company in a form satisfactory to the Buyer and its counsel.

(d)           The Buyer shall have issued an irrevocable issuance instruction
letter and board resolution, authorizing the issuance of the Advisory Fee Shares
and irrevocably directing its Transfer Agent to issue and deliver the Advisory
Fee Shares to Buyer or its designee.

(e)           The Company shall have executed and delivered to Buyer a closing
certificate in substance and form required by Buyer, which closing certificate
shall include and attach as exhibits: (i) a true copy of a certificate of good
standing evidencing the formation and good standing of the Company from the
secretary of state (or comparable office) from the jurisdiction in which the
Company is incorporated, as of a date within thirty (30) days of the First
Closing Date; (ii) the Company’s Certificate of Incorporation; (iii) the
Company’s Bylaws; and (iv) copies of the resolutions of the board of directors
of the Company consistent with Section 6.3, as adopted by the Company’s board of
directors in a form reasonably acceptable to Buyer.

(f)           No event shall have occurred which could reasonably be expected to
have a Material Adverse Effect.

(g)           The Company shall have executed such other agreements,
certificates, confirmations or resolutions as the Buyer may require to
consummate the transactions contemplated by this Agreement and the Transaction
Documents, including a closing statement and joint disbursement instructions as
may be required by Buyer.
  
9.2           Additional Closings.  Provided the Buyer is to purchase additional
Debentures in accordance with Section 4.4 at an Additional Closing, the
obligation of the Buyer hereunder to accept and purchase the Debentures at any
Additional Closing is subject to the satisfaction, at or before the Additional
Closing Date, of each of the following conditions:

(a)           The Company shall have executed the Transaction Documents
applicable to the Additional Closing and delivered the same to the Buyer.

(b)           The representations and warranties of the Company shall be true
and correct in all material respects (except to the extent that any of such
representations and warranties are already qualified as to materiality in
Article VI above, in which case, such representations and warranties shall be
true and correct in all respects without further qualification) as of the date
when made and as of the Additional Closing Date as though made at that time
(except for representations and warranties that speak as of a specific date) and
the Company shall have performed, satisfied and complied in all material
respects with the covenants, agreements and conditions required by this
Agreement to be performed, satisfied or complied with by the Company at or prior
to the Additional Closing Date.

 
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(c)            No event shall have occurred which could reasonably be expected
to have a Material Adverse Effect.

(d)           No default or Event of Default shall have occurred and be
continuing under this Agreement or any other Transaction Documents, and no event
shall have occurred that, with the passage of time, the giving of notice, or
both, would constitute a default or an Event of Default under this Agreement or
any other Transaction Documents.

(e)           The Company shall have executed such other agreements,
certificates, confirmations or resolutions as the Buyer may require to
consummate the transactions contemplated by this Agreement and the Transaction
Documents, including a closing statement and joint disbursement instructions as
may be required by Buyer.
 
ARTICLE X
INDEMNIFICATION

10.1           Company’s Obligation to Indemnify.  In consideration of the
Buyer’s execution and delivery of this Agreement and acquiring the Securities
hereunder, and in addition to all of the Company’s other obligations under this
Agreement, the Company hereby agrees to defend and indemnify Buyer and its
Affiliates and subsidiaries and their respective directors, officers, employees,
agents and representatives, and the successors and assigns of each of them
(collectively, the “Buyer Indemnified Parties”) and Company does hereby agree to
hold the Buyer Indemnified Parties forever harmless, from and against any and
all Claims made, brought or asserted against the Buyer Indemnified Parties, or
any one of them, and Company hereby agrees to pay or reimburse the Buyer
Indemnified Parties for any and all Claims payable by any of the Buyer
Indemnified Parties to any Person, including reasonable attorneys’ and
paralegals’ fees and expenses, court costs, settlement amounts, costs of
investigation and interest thereon from the time such amounts are due at the
highest non-usurious rate of interest permitted by applicable Law, through all
negotiations, mediations, arbitrations, trial and appellate levels, as a result
of, or arising out of, or relating to: (i) any misrepresentation or breach of
any representation or warranty made by the Company or any of its subsidiaries in
this Agreement, the Transaction Documents or any other certificate, instrument
or document contemplated hereby or thereby; (ii) any breach of any covenant,
agreement or Obligation of the Company or its subsidiaries contained in this
Agreement, the Transaction Documents or any other certificate, instrument or
document contemplated hereby or thereby; or (iii) any Claims brought or made
against the Buyer Indemnified Parties, or any one of them, by a third party and
arising out of or resulting from the execution, delivery, performance or
enforcement of this Agreement, the Transaction Documents or any other
instrument, document or agreement executed pursuant hereto or thereto, any
transaction financed or to be financed in whole or in part, directly or
indirectly, with the proceeds of the issuance of the Debentures, or the status
of the Buyer or holder of any of the Securities, as a buyer and holder of such
Securities in the Company. To the extent that the foregoing undertaking by the
Company may be unenforceable for any reason, the Company shall make the maximum
contribution to the payment and satisfaction of each of the Claims covered
hereby, which is permissible under applicable Law.

ARTICLE XI
MISCELLANEOUS

 
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11.1           Notices.  All notices of request, demand and other communications
hereunder shall be addressed to the parties as follows:

If to the Company:                                             Revolutions
Medical Corporation
670 Marina Drive
Charleston, South Carolina 29292
Attention: Ronald Wheet, President
Telephone: (843) 971-4848
Facsimile: (843) 971-6917
E-Mail: rwheet@revolutionsmedical.com

 
If to the Buyer:                                                    TCA Global
Credit Master Fund, LP
1404 Rodman Street
Hollywood, FL 33020
Attn: Mr. Robert Press
Telephone: (786) 323-1650
Facsimile: (786) 323-1651
E-Mail: bpress@tcaglobalfund.com

 
With a copy to:                                                   David Kahan,
P.A.
6420 Congress Ave., Suite 1800
Boca Raton, FL 33487
Attn: David Kahan, Esq.
Telephone: (561) 672-8330
Facsimile: (561) 672-8301
E-Mail: david@dkpalaw.com

 
unless the address is changed by the party by like notice given to the other
parties. Notice shall be in writing and shall be deemed delivered: (i) if mailed
by certified mail, return receipt requested, postage prepaid and properly
addressed to the address below, then three (3) business days after deposit of
same in a regularly maintained U.S. Mail receptacle; or (ii) if mailed by
Federal Express, UPS or other nationally recognized overnight courier service,
next business morning delivery, then one (1) business day after deposit of same
in a regularly maintained receptacle of such overnight courier; or (iii) if hand
delivered, then upon hand delivery thereof to the address indicated on or prior
to 5:00 p.m., EST, on a business day. Any notice hand delivered after 5:00 p.m.,
EST, shall be deemed delivered on the following business day. Notwithstanding
the foregoing, notice, consents, waivers or other communications referred to in
this Agreement may be sent by facsimile, e-mail, or other method of delivery,
but shall be deemed to have been delivered only when the sending party has
confirmed (by reply e-mail or some other form of written confirmation from the
receiving party) that the notice has been received by the other party.

11.2           Obligations Absolute.  None of the following shall affect the
Obligations of the Company to Buyer under this Agreement, Buyer’s rights with
respect to the Collateral or any other Transaction Documents:

(a)           acceptance or retention by Buyer of other property or any interest
in property as security for the Obligations;

 
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(b)           release by Buyer of all or any part of the Collateral or of any
party liable with respect to the Obligations (other than Company);

(c)           release, extension, renewal, modification or substitution by Buyer
of the Debentures or any other Transaction Documents; or

(d)           failure of Buyer to resort to any other security or to pursue the
Company or any other obligor liable for any of the Obligations of the Company
hereunder before resorting to remedies against the Collateral.

11.3           Entire Agreement.  This Agreement and the other Transaction
Documents: (i) are valid, binding and enforceable against the Company and Buyer
in accordance with its provisions and no conditions exist as to their legal
effectiveness; (ii) constitute the entire agreement between the parties; and
(iii) are the final expression of the intentions of the Company and Buyer.  No
promises, either expressed or implied, exist between the Company and Buyer,
unless contained herein or in the Transaction Documents.  This Agreement and the
Transaction Documents supersede all negotiations, representations, warranties,
commitments, offers, contracts (of any kind or nature, whether oral or written)
prior to or contemporaneous with the execution hereof.

11.4           Amendments; Waivers.  No amendment, modification, termination,
discharge or waiver of any provision of this Agreement or of the Transaction
Documents, or consent to any departure by the Company therefrom, shall in any
event be effective unless the same shall be in writing and signed by Buyer, and
then such waiver or consent shall be effective only for the specific purpose for
which given.

11.5           WAIVER OF JURY TRIAL. BUYER AND THE COMPANY, AFTER CONSULTING OR
HAVING HAD THE OPPORTUNITY TO CONSULT WITH COUNSEL, EACH KNOWINGLY, VOLUNTARILY
AND INTENTIONALLY WAIVES, IRREVOCABLY, THE RIGHT TO TRIAL BY JURY WITH RESPECT
TO ANY LEGAL PROCEEDING BASED HEREON, OR ARISING OUT OF, UNDER OR IN CONNECTION
WITH THIS AGREEMENT, ANY TRANSACTION DOCUMENT OR ANY OF THE OBLIGATIONS
HEREUNDER, THE COLLATERAL, OR ANY OTHER AGREEMENT EXECUTED OR CONTEMPLATED TO BE
EXECUTED IN CONJUNCTION WITH THIS AGREEMENT, OR ANY COURSE OF CONDUCT OR COURSE
OF DEALING IN WHICH BUYER AND THE COMPANY ARE ADVERSE PARTIES.  THIS PROVISION
IS A MATERIAL INDUCEMENT FOR BUYER PURCHASING THE DEBENTURES.

11.6           MANDATORY FORUM SELECTION.  TO INDUCE BUYER TO PURCHASE THE
DEBENTURES, THE COMPANY IRREVOCABLY AGREES THAT ANY DISPUTE ARISING UNDER,
RELATING TO, OR IN CONNECTION WITH, DIRECTLY OR INDIRECTLY, THIS AGREEMENT OR
RELATED TO ANY MATTER WHICH IS THE SUBJECT OF OR INCIDENTAL TO THIS AGREEMENT
ANY OTHER TRANSACTION DOCUMENT (WHETHER OR NOT SUCH CLAIM IS BASED UPON BREACH
OF CONTRACT OR TORT) SHALL BE SUBJECT TO THE EXCLUSIVE JURISDICTION AND VENUE OF
THE STATE AND/OR FEDERAL COURTS LOCATED IN BROWARD COUNTY, FLORIDA.  THIS
PROVISION  IS INTENDED TO BE A “MANDATORY” FORUM SELECTION CLAUSE AND GOVERNED
BY AND INTERPRETED CONSISTENT WITH FLORIDA LAW. THE COMPANY HEREBY CONSENTS TO
THE EXCLUSIVE JURISDICTION AND VENUE OF ANY STATE OR FEDERAL COURT HAVING ITS
SITUS IN SAID COUNTY, AND WAIVES ANY OBJECTION BASED ON FORUM NON CONVENIENS.
THE COMPANY HEREBY WAIVES PERSONAL SERVICE OF ANY AND ALL PROCESS AND CONSENT
THAT ALL SUCH SERVICE OF PROCESS MAY BE MADE BY CERTIFIED MAIL, RETURN RECEIPT
REQUESTED, DIRECTED TO THE COMPANY AS SET FORTH HEREIN IN THE MANNER PROVIDED BY
APPLICABLE STATUTE, LAW, RULE OF COURT OR OTHERWISE.

 
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11.7           Assignability. Buyer may at any time assign Buyer’s rights in
this Agreement, the Debentures, any Transaction Document, or any part thereof
and transfer Buyer’s rights in any or all of the Collateral, and Buyer
thereafter shall be relieved from all liability with respect to such
Collateral.  In addition, Buyer may at any time sell one or more participations
in the Debentures.  The Company may not sell or assign this Agreement, any
Transaction Document or any other agreement with Buyer, or any portion thereof,
either voluntarily or by operation of law, nor delegate any of its duties of
obligations hereunder or thereunder, without the prior written consent of Buyer,
which consent may be withheld or conditioned in Buyer’s sole and absolute
discretion.  This Agreement shall be binding upon Buyer and the Company and
their respective legal representatives, successors and permitted assigns.  All
references herein to a Company shall be deemed to include any successors,
whether immediate or remote.  In the case of a joint venture or partnership, the
term “Company” shall be deemed to include all joint venturers or partners
thereof, who shall be jointly and severally liable hereunder.

11.8           Publicity.  Buyer shall have the right to approve, before
issuance, any press release or any other public statement with respect to the
transactions contemplated hereby made by the Company; provided, however, that
the Company shall be entitled, without the prior approval of Buyer, to issue any
press release or other public disclosure with respect to such transactions
required under applicable securities or other laws or
regulations.  Notwithstanding the foregoing, the Company shall use its best
efforts to consult Buyer in connection with any such press release or other
public disclosure prior to its release and Buyer shall be provided with a copy
thereof upon release thereof.  Buyer shall have the right to make any press
release with respect to the transactions contemplated hereby without Company’s
approval.  In addition, with respect to any press release to be made by Buyer,
the Company hereby authorizes and grants blanket permission to Buyer to include
the Company’s stock symbol, if any, in any press releases.  The Company shall,
promptly upon request, execute any additional documents of authority or
permission as may be requested by Buyer in connection with any such press
releases.

11.9           Binding Effect.  This Agreement shall become effective upon
execution by the Company and Buyer.

11.10         Governing Law.  Except in the case of the Mandatory Forum
Selection Clause in Section 11.6 above, which clause shall be governed and
interpreted in accordance with Florida law, this Agreement and all other
Transaction Documents shall be delivered and accepted in and shall be deemed to
be contracts made under and governed by the internal laws of the State of
Nevada, and for all purposes shall be construed in accordance with the laws of
such State, without giving effect to the choice of law provisions of such State.

11.11         Enforceability.  Wherever possible, each provision of this
Agreement shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement shall be prohibited by,
unenforceable or invalid under any jurisdiction, such provision shall as to such
jurisdiction, be severable and be ineffective to the extent of such prohibition
or invalidity, without invalidating the remaining provisions of this Agreement
or affecting the validity or enforceability of such provision in any other
jurisdiction.

 
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11.12           Survival of Company’s Representations.  All covenants,
agreements, representations and warranties made by the Company herein shall,
notwithstanding any investigation by Buyer, be deemed material and relied upon
by Buyer and shall survive the making and execution of this Agreement and the
Transaction Documents and the sale and purchase of the Debentures, and shall be
deemed to be continuing representations and warranties until such time as the
Company has fulfilled all of its Obligations to Buyer hereunder and under all
other Transaction Documents, and Buyer has been indefeasibly paid in full.

11.13           Time of Essence.  Time is of the essence in making payments of
all amounts due Buyer under this Agreement and the other Transaction Documents
and in the performance and observance by the Company of each covenant,
agreement, provision and term of this Agreement and the other Transaction
Documents.  The parties agree that in the event that any date on which
performance is to occur falls on a day other than a Business Day, then the time
for such performance shall be extended until the next Business Day thereafter
occurring.

11.14           Release.  In consideration of the mutual promises and covenants
made herein, and other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, and intending to be legally bound
hereby, the Company hereby agrees to fully, finally and forever release and
forever discharge and covenant not to sue Buyer, and/or any other Buyer
Indemnified Parties from any and all Claims, debts, fees, attorneys’ fees,
liens, costs, expenses, damages, sums of money, accounts, bonds, bills,
covenants, promises, judgments, charges, demands, causes of action, suits,
Proceedings, liabilities, expenses, Obligations or Contracts of any kind
whatsoever, whether in law or in equity, whether asserted or unasserted, whether
known or unknown, fixed or contingent, under statute or otherwise, from the
beginning of time through the Effective Date, including, without  limiting the
generality of the foregoing, any and all Claims relating to or arising out of
any financing transactions, credit facilities, debentures, security agreements,
and other agreements including each of the Transaction Documents, entered into
by the Company with Buyer and any and all Claims that the Company does not know
or suspect to exist, whether through ignorance, oversight, error, negligence, or
otherwise, and which, if known, would materially affect their decision to enter
into this Agreement or the related Transaction Documents.

11.15           Interpretation.  If any provision in this Agreement requires
judicial or similar interpretation, the judicial or other such body interpreting
or construing such provision shall not apply the assumption that the terms
hereof shall be more strictly construed against one party because of the rule
that an instrument must be construed more strictly against the party which
itself or through its agents prepared the same.  The parties hereby agree that
all parties and their agents have participated in the preparation hereof
equally.

11.16           Compliance with Federal Law.  The Company shall: (i) ensure that
no Person who owns a controlling interest in or otherwise controls the Company
is or shall be listed on the Specially Designated Nationals and Blocked Person
List or other similar lists maintained by the Office of Foreign Assets Control
(“OFAC”), the Department of the Treasury, included in any Executive Orders or
any other similar lists from any Governmental Authority, foreign or national;
(ii) not use or permit the use of the proceeds of the Debentures to violate any
of the foreign asset control regulations of OFAC or any enabling statute or
Executive Order relating thereto, or any other similar national or foreign
governmental regulations; and (iii) comply with all applicable Buyer Secrecy Act
laws and regulations, as amended.  As required by federal law and Buyer’s
policies and practices, Buyer may need to obtain, verify and record certain
customer identification information and documentation in connection with opening
or maintaining accounts or establishing or continuing to provide services.

 
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11.17           Termination.  Upon payment in full of all outstanding Debentures
purchased hereunder, together with all other charges, fees and costs due and
payable under this Agreement or under any of the Transaction Documents, the
Company shall have the right to terminate this Agreement upon written notice to
the Buyer, provided, however, that if such termination occurs within the first
one hundred eighty (180) days after the First Closing Date, then the Company
shall pay to Buyer as liquidated damages and compensation for the costs of being
prepared to make funds available hereunder, an amount equal to Five Percent (5%)
of the amount of Debentures purchased hereunder.  The parties agree that the
amount payable pursuant to this Section 11.17 is a reasonable calculation of
Buyer’s lost profits in view of the difficulties and impracticality of
determining actual damages resulting from an early termination of this
Agreement.

11.18           Gender and Use of Singular and Plural.  All pronouns shall be
deemed to refer to the masculine, feminine, neuter, singular or plural, as the
identity of the party or parties or their personal representatives, successors
and assigns may require.

11.19           Execution.  This Agreement may be executed in one or more
counterparts, all of which taken together shall be deemed and considered one and
the same Agreement, and same shall become effective when counterparts have been
signed by each party and each party has delivered its signed counterpart to the
other party.  In the event that any signature is delivered by facsimile
transmission or by e-mail delivery of a “.pdf” format file or other similar
format file, such signature shall be deemed an original for all purposes and
shall create a valid and binding obligation of the party executing same with the
same force and effect as if such facsimile or “.pdf” signature page was an
original thereof.

11.20           Headings.  The article and section headings contained in this
Agreement are inserted for convenience only and shall not affect in any way the
meaning or interpretation of the Agreement.

11.21           Further Assurances.  The Company will execute and deliver such
further instruments and do such further acts and things as may be reasonably
required by Buyer to carry out the intent and purposes of this Agreement.

11.22           No Third Party Beneficiaries. This Agreement is intended for the
benefit of the parties hereto and their respective permitted successors and
assigns, and is not for the benefit of, nor may any provision hereof be enforced
by, any other Person.

11.23           Confession of Judgment.  Upon the occurrence of an Event of
Default, in addition to any other rights or remedies the Buyer may have under
the Transaction Documents or applicable law, the Buyer shall have the right, but
not the obligation, to cause the Confession of Judgment against the Company in
the form attached hereto as Exhibit “C” (the “Company Confession of Judgment”)
to be entered into a court of competent jurisdiction, provided, however, that
the Buyer shall give the Company ten (10) days prior written notice of its
intent to file the Company Confession of Judgment, during which period the
Company shall have the opportunity to cure the applicable defaults.  Upon the
occurrence of a breach or default under the Vaidity Certifications, in addition
to any other rights or remedies the Buyer may have under the Transaction
Documents or applicable law, the Buyer shall have the right, but not the
obligation, to cause the Confession of Judgment against the parties giving the
Validity Certifications in the form attached hereto as Exhibit “C” (the
“Principal Confession of Judgment”) to be entered into a court of competent
jurisdiction, provided, however, that the Buyer shall give the principal under
the Validity Certifications ten (10) days prior written notice of its intent to
file the Principal Confession of Judgment, during which period, such principal
of the Company shall have the opportunity to cure the applicable defaults.

[SIGNATURES ON THE FOLLOWING PAGE]

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

 
COMPANY:
         
REVOLUTIONS MEDICAL CORPORATION, a Nevada corporation
             
 
By:
      Name:       Title:               Date:                      
BUYER:
           
TCA GLOBAL CREDIT MASTER FUND, LP
            By:
TCA Global Credit Fund GP, Ltd.
    Its:
General Partner
                   
By:
       
Robert Press, Managing Director
           
Date:
   

 
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EXHIBIT “A”

FORM OF DEBENTURE
 
 
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 EXHIBIT “B”

FORM OF COMPLIANCE CERTIFICATE
 
 
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EXHIBIT “C”

CONFESSION OF JUDGMENT
 
 
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DISCLOSURE SCHEDULES FOR COMPANY
 
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