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Exhibit 10.1

SECURITIES PURCHASE AGREEMENT

SECURITIES PURCHASE AGREEMENT (the "Agreement"), dated as of December 20, 2007,
by and among EnterConnect Inc., a Nevada corporation, with headquarters located
at 100 Century Center Court, Suite 650, San Jose, California 95112-4537 (the
"Company"), and the investors listed on the Schedule of Buyers attached hereto
(individually, a "Buyer" and collectively, the "Buyers").

WHEREAS:

A.           The Company and each Buyer is executing and delivering this
Agreement in reliance upon the exemption from securities registration afforded
by Section 4(2) of the Securities Act of 1933, as amended (the "1933 Act"), and
Rule 506 of Regulation D ("Regulation D") as promulgated by the United States
Securities and Exchange Commission (the "SEC") under the 1933 Act.

B.           The Company has authorized a new series of senior convertible notes
of the Company, in the form attached hereto as Exhibit A (the "Notes"), which
Notes shall be convertible into the Company's common stock, par value $0.001 per
share (the "Common Stock") (as converted, the "Conversion Shares"), in
accordance with the terms of the Notes.

C.           Each Buyer wishes to purchase, and the Company wishes to sell, upon
the terms and conditions stated in this Agreement, (i) that aggregate principal
amount of the Notes set forth opposite such Buyer's name in column (3) on the
Schedule of Buyers attached hereto (which aggregate amount for all Buyers shall
be $4,823,000 and (ii) warrants, in substantially the form attached hereto as
Exhibit B (the "Warrants"), to acquire up to that number of additional shares of
Common Stock set forth opposite such Buyer's name in column (4) of the Schedule
of Buyers (as exercised, collectively, the "Warrant Shares").

D.           Contemporaneously with the execution and delivery of this
Agreement, the parties hereto are executing and delivering a Registration Rights
Agreement, substantially in the form attached hereto as Exhibit C (the
"Registration Rights Agreement"), pursuant to which the Company will agree to
provide certain registration rights with respect to the Registrable Securities
(as defined in the Registration Rights Agreement) under the 1933 Act and the
rules and regulations promulgated thereunder, and applicable state securities
laws.

E.           The Notes, the Conversion Shares, the Warrants and the Warrant
Shares collectively are referred to herein as the "Securities".

F.           The Notes will rank senior to all outstanding and future
indebtedness of the Company and will be secured by a perfected security
interest, in all of the assets of the Company, as evidenced by (i) a pledge and
security agreement, in the form attached hereto as Exhibit H (as amended or
modified from time to time in accordance with its terms, the "Pledge and
Security Agreement", and, together with any ancillary documents related thereto,
collectively the "Security Documents").

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G.           The Buyers desire to appoint The Bank of New York as collateral
agent with respect to the Collateral (as defined in the Security Agreement) (in
such capacity, the "Collateral Agent") pursuant to a Collateral Agency
Agreement, in the form attached hereto as Exhibit I (as amended or modified from
time to time in accordance with its terms, the "Collateral Agency Agreement").

NOW, THEREFORE, the Company and each Buyer hereby agree as follows:

1.             PURCHASE AND SALE OF NOTES AND WARRANTS.

(a)           Purchase of Notes and Warrants.

(i)             Notes and Warrants. Subject to the satisfaction (or waiver) of
the conditions set forth in Sections 6 and 7 below, the Company shall issue and
sell to each Buyer, and each Buyer severally, but not jointly, shall purchase
from the Company on the Closing Date (as defined below), (x) a principal amount
of Notes as is set forth opposite such Buyer's name in column (3) on the
Schedule of Buyers and (y) Warrants to acquire up to that number of Warrant
Shares as is set forth opposite such Buyer's name in column (4) on the Schedule
of Buyers, (the "Closing").

(ii)            Closing.  The date and time of the Closing (the "Closing Date")
shall be 10:00 a.m., New York City time, on the date hereof (or such later date
as is mutually agreed to by the Company and each Buyer) after notification of
satisfaction (or waiver) of the conditions to the Closing set forth in Sections
6 and 7 below at the offices of Schulte Roth & Zabel LLP, 919 Third Avenue, New
York, New York 10022.

(iii)           Purchase Price.

(1)           The aggregate purchase price for the Notes and the Warrants to be
purchased by each such Buyer at the Closing (the "Purchase Price") shall be the
amount set forth opposite each Buyer's name in column (5) of the Schedule of
Buyers.  Each Buyer shall pay $1,000 for each $1,000 of principal amount of
Notes and related Warrants to be purchased by such Buyer at the Closing.

(2)             The Buyers and the Company agree that the Notes and the Warrants
constitute an "investment unit" for purposes of Section 1273(c)(2) of the
Internal Revenue Code of 1986, as amended (the "Code").  The Buyers and the
Company mutually agree that the allocation of the issue price of such investment
unit between the Notes and the Warrants in accordance with Section 1273(c)(2) of
the Code and Treasury Regulation Section 1.1273-2(h) shall be an aggregate
amount of $10,000 allocated to the Warrants and the balance of the Purchase
Price allocated to the Notes, and neither the Buyers nor the Company shall take
any position inconsistent with such allocation in any tax return or in any
judicial or administrative proceeding in respect of taxes.

(b)           Form of Payment.  On the Closing Date, (i) each Buyer shall pay
its Purchase Price (less, in the case of Highbridge International LLC, the
amounts withheld pursuant to Section 4(g)) to the Company for the Notes and the
Warrants to be issued and sold to such Buyer at the Closing, by wire transfer of
immediately available funds in accordance with the Company's written wire
instructions or by surrender of such Buyer's Existing Debentures (as defined in
the Exchange Agreement) as contemplated by that certain Exchange Agreement by
and among the company and certain of the Buyers, dated as of even date herewith,
(the "Exchange Agreement") and (ii) the Company shall deliver to each Buyer the
Notes (allocated in the principal amounts as such Buyer shall request) which
such Buyer is then purchasing hereunder along with the Warrants (allocated in
the amounts as such Buyer shall request) which such Buyer is purchasing, in each
case duly executed on behalf of the Company and registered in the name of such
Buyer or its designee.

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2.             BUYER'S REPRESENTATIONS AND WARRANTIES.  Each Buyer, severally
and not jointly, represents and warrants with respect to only itself that, as of
the date hereof and as of the Closing Date:

(a)           No Sale or Distribution.  Such Buyer is acquiring the Notes, and
the Warrants, and upon conversion of the Notes and exercise of the Warrants
(other than pursuant to a Cashless Exercise (as defined in the Warrants)) will
acquire the Conversion Shares issuable upon conversion of the Notes and the
Warrant Shares issuable upon exercise of the Warrants, for its own account 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
1933 Act; provided, however, that by making the representations herein, such
Buyer does not agree to hold any of the Securities for any minimum or other
specific term and reserves the right to dispose of the Securities at any time in
accordance with or pursuant to a registration statement or an exemption under
the 1933 Act and pursuant to the applicable terms of the Transaction Documents
(as defined in Section 3(b)).  Such Buyer is acquiring the Securities hereunder
in the ordinary course of its business.  Such Buyer does not presently have any
agreement or understanding, directly or indirectly, with any Person to
distribute any of the Securities.

(b)           Accredited Investor Status.  Such Buyer is an "accredited
investor" as that term is defined in Rule 501(a) of Regulation D.

(c)           Reliance on Exemptions.  Such 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
such Buyer's compliance with, the representations, warranties, agreements,
acknowledgments and understandings of such Buyer set forth herein in order to
determine the availability of such exemptions and the eligibility of such Buyer
to acquire the Securities.

(d)           Information.  Such Buyer and its advisors, if any, have been
furnished with all materials relating to the business, finances and operations
of the Company and materials relating to the offer and sale of the Securities
that have been requested by such Buyer.  Such Buyer and its advisors, if any,
have been afforded the opportunity to ask questions of the Company.  Neither
such inquiries nor any other due diligence investigations conducted by such
Buyer or its advisors, if any, or its representatives shall modify, amend or
affect such Buyer's right to rely on the Company's representations and
warranties contained herein.  Such Buyer understands that its investment in the
Securities involves a high degree of risk and is able to afford a complete loss
of such investment.  Such 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.

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(e)           No Governmental Review.  Such Buyer understands that no United
States federal or state agency or any other government or governmental agency
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
authorities passed upon or endorsed the merits of the offering of the
Securities.

(f)           Transfer or Resale.  Such Buyer understands that except as
provided in the Registration Rights Agreement: (i) the Securities have not been
and are not being registered under the 1933 Act or any state securities laws,
and may not be offered for sale, sold, assigned or transferred unless (A)
subsequently registered thereunder, (B) such Buyer shall have delivered to the
Company an opinion of counsel, in a generally acceptable form, to the effect
that such Securities to be sold, assigned or transferred may be sold, assigned
or transferred pursuant to an exemption from such registration, or (C) such
Buyer provides the Company with reasonable assurance that such Securities can be
sold, assigned or transferred pursuant to Rule 144 or Rule 144A promulgated
under the 1933 Act, as amended (or a successor rule thereto) (collectively,
"Rule 144"); (ii) any sale of the Securities made in reliance on Rule 144 may be
made only in accordance with the terms of Rule 144 and further, if Rule 144 is
not applicable, any resale of the Securities under circumstances in which the
seller (or the Person (as defined in Section 3(s)) through whom the sale is
made) may be deemed to be an underwriter (as that term is defined in the 1933
Act) may require compliance with some other exemption under the 1933 Act or the
rules and regulations of the SEC thereunder; and (iii) neither the Company nor
any other Person is under any obligation to register the Securities under the
1933 Act or any state securities laws or to comply with the terms and conditions
of any exemption thereunder.  The Securities may be pledged in connection with a
bona fide margin account or other loan or financing arrangement secured by the
Securities and such pledge of Securities shall not be deemed to be a transfer,
sale or assignment of the Securities hereunder, and no Buyer effecting a pledge
of Securities shall be required to provide the Company with any notice thereof
or otherwise make any delivery to the Company pursuant to this Agreement or any
other Transaction Document (as defined in Section 3(b)), including, without
limitation, this Section 2(f).

(g)           Legends.  Such Buyer understands that the certificates or other
instruments representing the Notes and the Warrants and, until such time as the
resale of the Conversion Shares and the Warrant Shares have been registered
under the 1933 Act as contemplated by the Registration Rights Agreement, the
stock certificates representing the Conversion Shares and the Warrant Shares,
except as set forth below, shall bear any legend as required by the "blue sky"
laws of any state and a restrictive legend in substantially the following form
(and a stop-transfer order may be placed against transfer of such stock
certificates):

[NEITHER THE ISSUANCE AND SALE OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE
NOR THE SECURITIES INTO WHICH THESE SECURITIES ARE [CONVERTIBLE][EXERCISABLE]
HAVE BEEN][THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN]
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE
SECURITIES LAWS.  THE SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED
OR ASSIGNED (I) IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR
THE SECURITIES UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR (B) AN OPINION
OF COUNSEL, IN A GENERALLY ACCEPTABLE FORM, THAT REGISTRATION IS NOT REQUIRED
UNDER SAID ACT OR (II) UNLESS SOLD PURSUANT TO RULE 144 OR RULE 144A UNDER SAID
ACT.  NOTWITHSTANDING THE FOREGOING, THE SECURITIES MAY BE PLEDGED IN CONNECTION
WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN OR FINANCING ARRANGEMENT SECURED
BY THE SECURITIES.
 

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The legend set forth above shall be removed and the Company shall issue a
certificate without such legend to the holder of the Securities upon which it is
stamped, if, unless otherwise required by state securities laws, (i) such
Securities are registered for resale under the 1933 Act, (ii) in connection with
a sale, assignment or other transfer, such holder provides the Company with an
opinion of a law firm reasonably acceptable to the Company (with Schulte Roth &
Zabel LLP being deemed acceptable), in a generally acceptable form, to the
effect that such sale, assignment or transfer of the Securities may be made
without registration under the applicable requirements of the 1933 Act, or (iii)
such holder provides the Company with reasonable assurance that the Securities
can be sold, assigned or transferred pursuant to Rule 144 or Rule 144A.

(h)           Validity; Enforcement.  This Agreement and the Registration Rights
Agreement to which such Buyer is a party have been duly and validly authorized,
executed and delivered on behalf of such Buyer and shall constitute the legal,
valid and binding obligations of such Buyer enforceable against such Buyer in
accordance with their respective terms, except as such enforceability may be
limited by general principles of equity or to applicable bankruptcy, insolvency,
reorganization, moratorium, liquidation and other similar laws relating to, or
affecting generally, the enforcement of applicable creditors' rights and
remedies.

(i)           No Conflicts.  The execution, delivery and performance by such
Buyer of this Agreement and the Registration Rights Agreement and the
consummation by such Buyer of the transactions contemplated hereby and thereby
will not (i) result in a violation of the organizational documents of such Buyer
or (ii) conflict with, or constitute a default (or an event which with notice or
lapse of time or both would become a default) under, or give to others any
rights of termination, amendment, acceleration or cancellation of, any
agreement, indenture or instrument to which such Buyer is a party, or (iii)
result in a violation of any law, rule, regulation, order, judgment  or decree
(including federal and state securities laws) applicable to such Buyer, except
in the case of clauses (ii) and (iii) above, for such conflicts, defaults,
rights or violations which would not, individually or in the aggregate,
reasonably be expected to have a material adverse effect on the ability of such
Buyer to perform its obligations hereunder.

(j)           Residency.  Such Buyer is a resident of that jurisdiction
specified below its address on the Schedule of Buyers.

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(k)           Certain Trading Activities.  Other than with respect to the
transactions contemplated herein, since the time that such Buyer was first
contacted by the Company, the Agent (as defined below) or any other Person
regarding this investment in the Company neither the Buyer nor any Affiliate of
such Buyer which (x) had knowledge of the transactions contemplated hereby, (y)
has or shares discretion relating to such Buyer's investments or trading or
information concerning such Buyer's investments and (z) is subject to such
Buyer's review or input concerning such Affiliate's investments or trading
(collectively, "Trading Affiliates") has directly or indirectly, nor has any
Person acting on behalf of or pursuant to any understanding with such Buyer or
Trading Affiliate, effected or agreed to effect any transactions in the
securities of the Company.  Such Buyer hereby covenants and agrees not to, and
shall cause its Trading Affiliates not to, engage, directly or indirectly, in
any transactions in the securities of the Company or involving the Company's
securities during the period from the date hereof until such time as (i) the
transactions contemplated by this Agreement are first publicly announced as
described in Section 4(i) hereof or (ii) this Agreement is terminated in full
pursuant to Section 8 hereof.  Notwithstanding the foregoing, for avoidance of
doubt, nothing contained herein shall constitute a representation or warranty,
or preclude any actions, with respect to the identification of the availability
of, or securing of, available shares to borrow in order to effect short sales or
similar transactions in the future.

3.             REPRESENTATIONS AND WARRANTIES OF THE COMPANY.  The Company
represents and warrants to each of the Buyers that, as of the date hereof and as
of the Closing Date:

(a)           Organization and Qualification.  The Company and its
"Subsidiaries" (which for purposes of this Agreement means any joint venture or
any entity in which the Company, directly or indirectly, owns any of the capital
stock or holds an equity or similar interest) are entities duly organized and
validly existing and, to the extent legally applicable, in good standing under
the laws of the jurisdiction in which they are formed, and have the requisite
power and authorization to own their properties and to carry on their business
as now being conducted.  Each of the Company and its Subsidiaries is duly
qualified as a foreign entity to do business and to the extent legally
applicable, is in good standing in every jurisdiction in which its ownership of
property or the nature of the business conducted by it makes such qualification
necessary, except to the extent that the failure to be so qualified or be in
good standing would not reasonably be expected to have a Material Adverse
Effect.  As used in this Agreement, "Material Adverse Effect" means any material
adverse effect on the business, properties, assets, operations, results of
operations, condition (financial or otherwise) or prospects of the Company and
its Subsidiaries, individually or taken as a whole, or on the transactions
contemplated hereby or in the other Transaction Documents or by the agreements
and instruments to be entered into in connection herewith or therewith, or on
the authority or ability of the Company to perform its obligations under the
Transaction Documents (as defined below).  The Company has no Subsidiaries.

(b)           Authorization; Enforcement; Validity.  The Company has the
requisite corporate power and authority to enter into and perform its
obligations under this Agreement, the Notes, the Registration Rights Agreement,
the Security Documents, the Irrevocable Transfer Agent Instructions (as defined
in Section 5(b)), the Warrants and each of the other agreements entered into by
the parties hereto in connection with the transactions contemplated by this
Agreement (collectively, the "Transaction Documents") and to issue the
Securities in accordance with the terms hereof and thereof.  The execution and
delivery of the Transaction Documents by the Company and the consummation by the
Company of the transactions contemplated hereby and thereby, including, without
limitation, the issuance of the Notes and the Warrants, the reservation for
issuance and the issuance of the Conversion Shares issuable upon conversion of
the Notes and the reservation for issuance and issuance of Warrant Shares
issuable upon exercise of the Warrants have been duly authorized by the
Company's Board of Directors and no further filing, consent, or authorization is
required by the Company, its Board of Directors or its stockholders.  This
Agreement and the other Transaction Documents of even date herewith have been
duly executed and delivered by the Company, and constitute the legal, valid and
binding obligations of the Company, enforceable against the 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 or similar laws relating to, or
affecting generally, the enforcement of applicable creditors' rights and
remedies.

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(c)           Issuance of Securities.  The issuance of the Notes and the
Warrants are duly authorized and upon issuance in accordance with the terms of
the Transaction Documents shall be free from all taxes, liens and charges with
respect to the issue thereof.  As of the Closing, a number of shares of Common
Stock shall have been duly authorized and reserved for issuance which equals or
exceeds 130% of the aggregate of the maximum number of shares of Common Stock
issuable (i) upon conversion of the Notes, and (ii) upon exercise of the
Warrants.  Upon conversion or exercise in accordance with the Notes or the
Warrants, as the case may be, the Conversion Shares and the Warrant Shares,
respectively, will be validly issued, fully paid and nonassessable and free from
all preemptive or similar rights, taxes, liens and charges with respect to the
issue thereof, with the holders being entitled to all rights accorded to a
holder of Common Stock.  Assuming the accuracy of each of the representations
and warranties set forth in Section 2 of this Agreement, the offer and issuance
by the Company of the Securities is exempt from registration under the 1933 Act.

(d)           No Conflicts.  The execution, delivery and performance of the
Transaction Documents by the Company and the consummation by the Company of the
transactions contemplated hereby and thereby (including, without limitation, the
issuance of the Notes and Warrants and reservation for issuance and issuance of
the Conversion Shares and the Warrant Shares) will not (i) result in a violation
of any article of incorporation, certificate of formation, any certificate of
designations or other constituent documents of the Company or any of its
Subsidiaries, any capital stock of the Company or any of its Subsidiaries or
bylaws of the Company or any of its Subsidiaries or (ii) conflict with, or
constitute a default (or an event which with notice or lapse of time or both
would become a default) in any respect under, or give to others any rights of
termination, amendment, acceleration or cancellation of, any agreement,
indenture or instrument to which the Company or any of its Subsidiaries is a
party, or (iii) result in a violation of any law, rule, regulation, order,
judgment or decree, including foreign, federal and state securities laws and
regulations and the rules and regulations of The OTC Bulletin Board (the
"Principal Market") applicable to the Company or any of its Subsidiaries or by
which any property or asset of the Company or any of its Subsidiaries is bound
or affected.

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(e)           Consents.  Neither the Company nor any of its Subsidiaries is
required to obtain any consent, authorization or order of, or make any filing or
registration with, any court, governmental agency or any regulatory or
self-regulatory agency or any other Person in order for it to execute, deliver
or perform any of its obligations under or contemplated by the Transaction
Documents, in each case in accordance with the terms hereof or thereof, except
for the following consents, authorizations, orders, filings and registrations
(none of which is required to be filed or obtained before the Closing): (i) the
filing with the SEC of one or more Registration Statements in accordance with
the requirements of the Registration Rights Agreement and (ii) the filing of a
listing application for the Conversion Shares and Warrant Shares with the
Principal Market, which shall be done pursuant to the rules of the Principal
Market.  The Company and its Subsidiaries are unaware of any facts or
circumstances that might prevent the Company from obtaining or effecting any of
the registration, application or filings pursuant to the preceding
sentence.  The Company is not in violation of the listing requirements of the
Principal Market and has no knowledge of any facts that would reasonably lead to
delisting or suspension of the Common Stock in the foreseeable future.  The
issuance by the Company of the Securities shall not have the effect of delisting
or suspending the Common Stock from the Principal Market.

(f)           Acknowledgment Regarding Buyer's Purchase of Securities.  The
Company acknowledges and agrees that each Buyer is acting solely in the capacity
of an arm's length purchaser with respect to the Transaction Documents and the
transactions contemplated hereby and thereby and that no Buyer is (i) an officer
or director of the Company, (ii) an "affiliate" of the Company or any of its
Subsidiaries (as defined in Rule 144) or (iii) to the knowledge of the Company,
a "beneficial owner" of more than 10% of the shares of Common Stock (as defined
for purposes of Rule 13d-3 of the Securities Exchange Act of 1934, as amended
(the "1934 Act")).  The Company further acknowledges that no Buyer is acting as
a financial advisor or fiduciary of the Company or any of its Subsidiaries (or
in any similar capacity) with respect to the Transaction Documents and the
transactions contemplated hereby and thereby, and any advice given by a Buyer or
any of its representatives or agents in connection with the Transaction
Documents and the transactions contemplated hereby and thereby is merely
incidental to such Buyer's purchase of the Securities.  The Company further
represents to each Buyer that the Company's decision to enter into the
Transaction Documents has been based solely on the independent evaluation by the
Company and its representatives.

(g)           No General Solicitation; Placement Agent's Fees.  Neither the
Company, nor any of its Subsidiaries or affiliates, nor any Person acting on its
or their behalf, has engaged in any form of general solicitation or general
advertising (within the meaning of Regulation D) in connection with the offer or
sale of the Securities.  The Company shall be responsible for the payment of any
placement agent's fees, financial advisory fees, or brokers' commissions (other
than for persons engaged by any Buyer or its investment advisor) relating to or
arising out of the transactions contemplated hereby, which fees are set forth on
Schedule 3(g).  The Company acknowledges that it has engaged Worldwide Gateway
Co., Ltd. as placement agent (collectively, the "Agent") in connection with the
sale of the Securities.  Other than the Agent, neither the Company nor any of
its Subsidiaries has engaged any placement agent or other agent in connection
with the sale of the Securities.

(h)           No Integrated Offering.  None of the Company, its Subsidiaries,
any of their affiliates, and any Person acting on their behalf has, directly or
indirectly, made any offers or sales of any security or solicited any offers to
buy any security, under circumstances that would require registration of any of
the Securities under the 1933 Act, or cause this offering of the Securities to
be integrated with prior offerings by the Company for purposes of any applicable
stockholder approval provisions, including, without limitation, under the rules
and regulations of any exchange or automated quotation system on which any of
the securities of the Company are listed or designated.  None of the Company,
its Subsidiaries, their affiliates and any Person acting on their behalf will
take any action or steps referred to in the preceding sentence that would
require registration of any of the Securities under the 1933 Act or cause the
offering of the Securities to be integrated with other offerings.

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(i)           Dilutive Effect.  The Company understands and acknowledges that
the number of Conversion Shares issuable upon conversion of the Notes and the
Warrant Shares issuable upon exercise of the Warrants will increase in certain
circumstances.  The Company further acknowledges that its obligation to issue
Conversion Shares upon conversion of the Notes in accordance with this Agreement
and the Notes and its obligation to issue the Warrant Shares upon exercise of
the Warrants in accordance with this Agreement and the Warrants is, in each
case, absolute and unconditional regardless of the dilutive effect that such
issuance may have on the ownership interests of other stockholders of the
Company.

(j)           Application of Takeover Protections; Rights Agreement.  The
Company and its board of directors have taken all necessary action, if any, in
order to render inapplicable any control share acquisition, business
combination, poison pill (including any distribution under a rights agreement)
or other similar anti-takeover provision under the Articles of Incorporation (as
defined in Section 3(r)) or the laws of the state of its incorporation which is
or could become applicable to any Buyer as a result of the transactions
contemplated by this Agreement, including, without limitation, the Company's
issuance of the Securities and any Buyer's ownership of the Securities.  The
Company and its board of directors have taken all necessary action, if any, in
order to render inapplicable any stockholder rights plan or similar arrangement
relating to accumulations of beneficial ownership of Common Stock or a change in
control of the Company.

(k)           SEC Documents; Financial Statements.  Since the effectiveness of
the Company's Registration Statement on the Form SB-2, the Company has filed all
reports, schedules, forms, statements and other documents required to be filed
by it with the SEC pursuant to the reporting requirements of the 1934 Act (all
of the foregoing filed prior to the date hereof and all exhibits included
therein and financial statements, notes and schedules thereto and documents
incorporated by reference therein being hereinafter referred to as the "SEC
Documents").  The Company has delivered to the Buyers or their respective
representatives true, correct and complete copies of the SEC Documents not
available on the EDGAR system.  As of their respective filing dates, the SEC
Documents complied in all material respects with the requirements of the 1934
Act and the rules and regulations of the SEC promulgated thereunder applicable
to the SEC Documents, 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 the light of the circumstances under which they
were made, not misleading.  As of their respective filing dates, the financial
statements of the Company included in the SEC Documents complied as to form in
all material respects with applicable accounting requirements and the published
rules and regulations of the SEC with respect thereto.  Such financial
statements have been prepared in accordance with generally accepted accounting
principles, consistently applied, during the periods involved (except (i) as may
be otherwise indicated in such financial statements or the notes thereto, or
(ii) in the case of unaudited interim statements, to the extent they may exclude
footnotes or may be condensed or summary statements) and fairly present in all
material respects the financial position of the Company as of the dates thereof
and the results of its operations and cash flows for the periods then ended
(subject, in the case of unaudited statements, to normal year-end audit
adjustments).  No other information provided by or on behalf of the Company to
the Buyers which is not included in the SEC Documents, including, without
limitation, information referred to in Section 2(d) of this Agreement or in any
disclosure schedules, 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.

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(l)           Absence of Certain Changes.  Since December 31, 2006, there has
been no material adverse change and no material adverse development in the
business, properties, operations, condition (financial or otherwise), results of
operations or prospects of the Company or its Subsidiaries.  Since December 31,
2006, the Company has not (i) declared or paid any dividends, (ii) sold any
assets, individually or in the aggregate, in excess of $50,000 outside of the
ordinary course of business or (iii) had capital expenditures, individually or
in the aggregate, in excess of $250,000.  Neither the Company nor any of its
Subsidiaries has taken any steps to seek protection pursuant to any bankruptcy
law nor does the Company have any knowledge or reason to believe that its
creditors intend to initiate involuntary bankruptcy proceedings or any actual
knowledge of any fact that would reasonably lead a creditor to do so.  The
Company and its Subsidiaries, individually and on a consolidated basis, are not
as of the date hereof, and after giving effect to the transactions contemplated
hereby to occur at the Closing, will not be Insolvent (as defined below).  For
purposes of this Section 3(l), "Insolvent" means, with respect to any Person (as
defined in Section 3(s)), (i) the present fair saleable value of such Person's
assets is less than the amount required to pay such Person's total Indebtedness
(as defined in Section 3(s)), (ii) such Person is unable to pay its debts and
liabilities, subordinated, contingent or otherwise, as such debts and
liabilities become absolute and matured, (iii) such Person intends to incur or
believes that it will incur debts that would be beyond its ability to pay as
such debts mature or (iv) such Person has unreasonably small capital with which
to conduct the business in which it is engaged as such business is now conducted
and is proposed to be conducted.

(m)           No Undisclosed Events, Liabilities, Developments or
Circumstances.  No event, liability, development or circumstance has occurred or
exists, or is contemplated to occur with respect to the Company, its
Subsidiaries or their respective business, properties, prospects, operations or
financial condition, that would be required to be disclosed by the Company under
applicable securities laws on a registration statement on Form S-1 filed with
the SEC relating to an issuance and sale by the Company of its Common Stock and
which has not been publicly announced.

(n)           Conduct of Business; Regulatory Permits.  Neither the Company nor
any of its Subsidiaries is in violation of any term of or in default under its
Articles of Incorporation, any certificate of designations of any outstanding
series of preferred stock of the Company or the Bylaws or their organizational
charter or bylaws, respectively.  Neither the Company nor any of its
Subsidiaries is in violation of any judgment, decree or order or any statute,
ordinance, rule or regulation applicable to the Company or its Subsidiaries, and
neither the Company nor any of its Subsidiaries will conduct its business in
violation of any of the foregoing, except for possible violations which could
not, individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect.  Without limiting the generality of the foregoing, the Company
is not in violation of any of the rules, regulations or requirements of the
Principal Market and has no knowledge of any facts or circumstances that would
reasonably lead to delisting or suspension of the Common Stock by the Principal
Market in the foreseeable future.  Since November 30, 2007 (i) the Common Stock
has been designated for quotation on the Principal Market, (ii) trading in the
Common Stock has not been suspended by the SEC or the Principal Market and (iii)
the Company has received no communication, written or oral, from the SEC or the
Principal Market regarding the suspension or delisting of the Common Stock from
the Principal Market.  The Company and its Subsidiaries possess all
certificates, authorizations and permits issued by the appropriate regulatory
authorities necessary to conduct their respective businesses, except where the
failure to possess such certificates, authorizations or permits would not have,
individually or in the aggregate, a Material Adverse Effect, and neither the
Company nor any such Subsidiary has received any notice of proceedings relating
to the revocation or modification of any such certificate, authorization or
permit.

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(o)           Foreign Corrupt Practices.  Neither the Company nor any of its
Subsidiaries nor any director, officer, agent, employee or other Person acting
on behalf of the Company or any of its Subsidiaries has, in the course of its
actions for, or on behalf of, the Company or any of its Subsidiaries (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 unlawful bribe, rebate, payoff, influence payment, kickback or other
unlawful payment to any foreign or domestic government official or employee.

(p)           Sarbanes-Oxley Act.  The Company is in compliance with any and all
applicable requirements of the Sarbanes-Oxley Act of 2002 that are effective as
of the date hereof, and any and all applicable rules and regulations promulgated
by the SEC thereunder that are effective as of the date hereof.

(q)           Transactions With Affiliates.  Except as set forth in the SEC
Documents filed at least ten (10) days prior to the date hereof and other than
the grant of stock options, none of the officers, directors or employees of the
Company or any of its Subsidiaries is presently a party to any transaction with
the Company or any of its Subsidiaries (other than for ordinary course services
as employees, officers or directors), including any contract, agreement or other
arrangement providing for the furnishing of services to or by, providing for
rental of real or personal property to or from, or otherwise requiring payments
to or from any such officer, director or employee or, to the knowledge of the
Company or any of its Subsidiaries, any corporation, partnership, trust or other
entity in which any such officer, director, or employee has a substantial
interest or is an officer, director, trustee or partner.

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(r)           Equity Capitalization.  As of the date hereof, the authorized
capital stock of the Company consists of  (i) 1,000,000 shares of Preferred
Stock, $0.001 par value, of which as of the date hereof, none are issued and
outstanding, (ii) 100,000,000 shares of Common Stock, of which as of the date
hereof, 27,125,261 are issued and outstanding, 10,000,000 shares are reserved
for issuance pursuant to the Company's stock option and purchase plans and
4,571,225 shares are reserved for issuance pursuant to securities, which shares
are set forth in Schedule 3(r), (other than the aforementioned options, the
Notes and the Warrants) exercisable or exchangeable for, or convertible into,
shares of Common Stock.  All of such outstanding shares have been, or upon
issuance will be, validly issued and are fully paid and nonassessable.  Except
as disclosed in Schedule 3(r): (i) none of the Company's capital stock is
subject to preemptive rights or any other similar rights or any liens or
encumbrances suffered or permitted by the Company; (ii) 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, or
exercisable or exchangeable for, any 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 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, or exercisable
or exchangeable for, any capital stock of the Company or any of its
Subsidiaries; (iii) there are no outstanding debt securities, notes, credit
agreements, credit facilities or other agreements, documents 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; (iv) there are no
financing statements securing obligations in any material amounts, either singly
or in the aggregate, filed in connection with the Company or any of its
Subsidiaries; (v) 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 1933 Act (except pursuant to the Registration Rights
Agreement); (vi) there are no outstanding securities or instruments of the
Company or any of its Subsidiaries which contain any redemption or similar
provisions, and there are no contracts, commitments, understandings or
arrangements by which the Company or any of its Subsidiaries is or may become
bound to redeem a security of the Company or any of its Subsidiaries; (vii)
there are no securities or instruments containing anti-dilution or similar
provisions that will be triggered by the issuance of the Securities; (viii) the
Company does not have any stock appreciation rights or "phantom stock" plans or
agreements or any similar plan or agreement; and (ix) the Company and its
Subsidiaries have no liabilities or obligations required to be disclosed in the
SEC Documents but not so disclosed in the SEC Documents, other than those
incurred in the ordinary course of the Company's or its Subsidiaries' respective
businesses and which, individually or in the aggregate, do not or would not have
a Material Adverse Effect.  The Company has furnished to the Buyers true,
correct and complete copies of the Company's Articles of Incorporation, as
amended and as in effect on the date hereof (the "Articles of Incorporation"),
and the Company's Bylaws, as amended and as in effect on the date hereof (the
"Bylaws"), and the terms of all securities convertible into, or exercisable or
exchangeable for, shares of Common Stock and the material rights of the holders
thereof in respect thereto.

(s)           Indebtedness and Other Contracts.  As of the date hereof, other
than the Existing Debentures (as defined in the Exchange Agreement), and as of
the Closing, neither the Company nor any of its Subsidiaries (i) has any
outstanding Indebtedness (as defined below), (ii) is a party to any contract,
agreement or instrument, the violation of which, or default under which, by the
other party(ies) to such contract, agreement or instrument could reasonably be
expected to result in a Material Adverse Effect, (iii) is in violation of any
term of or in default under any contract, agreement or instrument relating to
any Indebtedness, except where such violations and defaults would not result,
individually or in the aggregate, in a Material Adverse Effect, or (iv) is a
party to any contract, agreement or instrument relating to any Indebtedness, the
performance of which, in the judgment of the Company's officers, has or is
expected to have a Material Adverse Effect.  For purposes of this
Agreement:  (x) "Indebtedness" of any Person means, without duplication (A) all
indebtedness for borrowed money, (B) all obligations issued, undertaken or
assumed as the deferred purchase price of property or services, including
(without limitation) "capital leases" in accordance with generally accepted
accounting principles (other than trade payables entered into in the ordinary
course of business), (C) all reimbursement or payment obligations with respect
to letters of credit, surety bonds and other similar instruments, (D) all
obligations evidenced by notes, bonds, debentures or similar instruments,
including obligations so evidenced incurred in connection with the acquisition
of property, assets or businesses, (E) all indebtedness created or arising under
any conditional sale or other title retention agreement, or incurred as
financing, in either case with respect to any property or assets acquired with
the proceeds of such indebtedness (even though the rights and remedies of the
seller or bank under such agreement in the event of default are limited to
repossession or sale of such property), (F) all monetary obligations under any
leasing or similar arrangement which, in connection with generally accepted
accounting principles, consistently applied for the periods covered thereby, is
classified as a capital lease, (G) all indebtedness referred to in clauses (A)
through (F) above secured by (or for which the holder of such Indebtedness has
an existing right, contingent or otherwise, to be secured by) any mortgage,
lien, pledge, charge, security interest or other encumbrance upon or in any
property or assets (including accounts and contract rights) owned by any Person,
even though the Person which owns such assets or property has not assumed or
become liable for the payment of such indebtedness, and (H) all Contingent
Obligations in respect of indebtedness or obligations of others of the kinds
referred to in clauses (A) through (G) above; (y) "Contingent Obligation" means,
as to any Person, any direct or indirect liability, contingent or otherwise, of
that Person with respect to any indebtedness, lease, dividend or other
obligation of another Person if the primary purpose or intent of the Person
incurring such liability, or the primary effect thereof, is to provide assurance
to the obligee of such liability that such liability will be paid or discharged,
or that any agreements relating thereto will be complied with, or that the
holders of such liability will be protected (in whole or in part) against loss
with respect thereto; and (z) "Person" means an individual, a limited liability
company, a partnership, a joint venture, a corporation, a trust, an
unincorporated organization and a government or any department or agency
thereof.

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(t)           Absence of Litigation.  There is no action, suit, proceeding,
inquiry or investigation before or by the Principal Market, any court, public
board, government agency, self-regulatory organization or body pending or, to
the knowledge of the Company, threatened against or affecting the Company or any
of its Subsidiaries, the Common Stock or any of the Company's Subsidiaries or
any of the Company's or its Subsidiaries' officers or directors.

(u)           Insurance.  The Company and each of its Subsidiaries are insured
by insurers of recognized financial responsibility against such losses and risks
and in such amounts as management of the Company believes to be prudent and
customary in the businesses in which the Company and its Subsidiaries are
engaged.  Neither the Company nor any such Subsidiary has been refused any
insurance coverage sought or applied for and neither the Company nor any such
Subsidiary has any reason to believe that it will not be able to renew its
existing insurance coverage as and when such coverage expires or to obtain
similar coverage from similar insurers as may be necessary to continue its
business at a cost that would not have a Material Adverse Effect.

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(v)           Employee Relations.

(i)            Neither the Company nor any of its Subsidiaries is a party to any
collective bargaining agreement or employs any member of a union.  The Company
and its Subsidiaries believe that their relations with their employees are
good.  No executive officer of the Company  or any of its Subsidiaries (as
defined in Rule 501(f) of the 1933 Act) has notified the Company or any such
Subsidiary that such officer intends to leave the Company or any such Subsidiary
or otherwise terminate such officer's employment with the Company or any such
Subsidiary.  No executive officer of the Company or any of its Subsidiaries, is,
or is now expected to be, in violation of any material term of any employment
contract, confidentiality, disclosure or proprietary information agreement,
non-competition agreement, or any other contract or agreement or any restrictive
covenant, and the continued employment of each such executive officer does not
subject the Company or any of its Subsidiaries to any liability with respect to
any of the foregoing matters.

(ii)           The Company and its Subsidiaries are in compliance with all
federal, state, local and foreign laws and regulations respecting labor,
employment and employment practices and benefits, terms and conditions of
employment and wages and hours, except where failure to be in compliance would
not, either individually or in the aggregate, reasonably be expected to result
in a Material Adverse Effect.

(w)           Title. The Company and its Subsidiaries have good and marketable
title in fee simple to all real property and good and marketable title to all
personal property owned by them which is material to the business of the Company
and its Subsidiaries, in each case free and clear of all liens, encumbrances and
defects except such as do not materially affect the value of such property and
do not interfere with the use made and proposed to be made of such property by
the Company and any of its Subsidiaries.  Any real property and facilities held
under lease by the Company or any of its Subsidiaries are held by them under
valid, subsisting and enforceable leases with such exceptions as are not
material and do not interfere with the use made and proposed to be made of such
property and buildings by the Company and its Subsidiaries.

(x)           Intellectual Property Rights.  The Company and its Subsidiaries
own or possess adequate rights or licenses to use all trademarks, service marks
and all applications and registrations therefor, trade names, patents, patent
rights, copyrights, original works of authorship, inventions, trade secrets and
other intellectual property rights ("Intellectual Property Rights") necessary to
conduct their respective businesses as now conducted.  None of the Company's
registered, or applied for, Intellectual Property Rights has expired or
terminated or has been abandoned, or is expected to expire or terminate or
expected to be abandoned, within three years from the date of this
Agreement.  The Company does not have any knowledge of any infringement by the
Company or its Subsidiaries of Intellectual Property Rights of others. There is
no claim, action or proceeding being made or brought, or to the knowledge of the
Company, being threatened, against the Company or its Subsidiaries regarding its
Intellectual Property Rights.  Neither the Company nor any of its Subsidiaries
is aware of any facts or circumstances which might give rise to any of the
foregoing infringements or claims, actions or proceedings.  The Company and its
Subsidiaries have taken reasonable security measures to protect the secrecy,
confidentiality and value of all of their Intellectual Property Rights.

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(y)           Environmental Laws.  The Company and its Subsidiaries (i) are in
compliance with any and all Environmental Laws (as hereinafter defined), (ii)
have received all permits, licenses or other approvals required of them under
applicable Environmental Laws to conduct their respective businesses and (iii)
are in compliance with all terms and conditions of any such permit, license or
approval where, in each of the foregoing clauses (i), (ii) and (iii), the
failure to so comply could be reasonably expected to have, individually or in
the aggregate, a Material Adverse Effect.  The term "Environmental Laws" means
all federal, state, local or foreign laws relating to pollution or protection of
human health or the environment (including, without limitation, ambient air,
surface water, groundwater, land surface or subsurface strata), including,
without limitation, laws relating to emissions, discharges, releases or
threatened releases of chemicals, pollutants, contaminants, or toxic or
hazardous substances or wastes (collectively, "Hazardous Materials") into the
environment, or otherwise relating to the manufacture, processing, distribution,
use, treatment, storage, disposal, transport or handling of Hazardous Materials,
as well as all authorizations, codes, decrees, demands or demand letters,
injunctions, judgments, licenses, notices or notice letters, orders, permits,
plans or regulations issued, entered, promulgated or approved thereunder.

(z)           Subsidiary Rights.  The Company or one of its Subsidiaries has the
unrestricted right to vote, and (subject to limitations imposed by applicable
law) to receive dividends and distributions on, all capital securities of its
Subsidiaries as owned by the Company or such Subsidiary.

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

(bb)         Internal Accounting and Disclosure 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 generally accepted accounting principles and to maintain asset
and liability accountability, (iii) access to assets or incurrence of
liabilities is permitted only in accordance with management's general or
specific authorization and (iv) the recorded accountability for assets and
liabilities is compared with the existing assets and liabilities at reasonable
intervals and appropriate action is taken with respect to any difference.  The
Company maintains disclosure controls and procedures (as such term is defined in
Rule 13a-14 under the 1934 Act) that are effective in ensuring that information
required to be disclosed by the Company in the reports that it files or submits
under the 1934 Act is recorded, processed, summarized and reported, within the
time periods specified in the rules and forms of the SEC, including, without
limitation, controls and procedures designed in to ensure that information
required to be disclosed by the Company in the reports that it files or submits
under the 1934 Act is accumulated and communicated to the Company's management,
including its principal executive officer or officers and its principal
financial officer or officers, as appropriate, to allow timely decisions
regarding required disclosure.  During the twelve months prior to the date
hereof neither the Company nor any of its Subsidiaries have received any notice
or correspondence from any accountant relating to any potential material
weakness in any part of the system of internal accounting controls of the
Company or any of its Subsidiaries.

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(cc)          Ranking of Notes.  No Indebtedness of the Company is senior to or
ranks pari passu with the Notes in right of payment, whether with respect of
payment of redemptions, interest, damages or upon liquidation or dissolution or
otherwise.

(dd)         Off Balance Sheet Arrangements.  There is no transaction,
arrangement, or other relationship between the Company and an unconsolidated or
other off balance sheet entity that is required to be disclosed by the Company
in its 1934 Act filings and is not so disclosed or that otherwise would be
reasonably likely to have a Material Adverse Effect.

(ee)          Investment Company Status.  The Company is not, and upon
consummation of the sale of the Securities will not be, an "investment company,"
a company controlled by an "investment company" or an "affiliated person" of, or
"promoter" or "principal underwriter" for, an "investment company" as such terms
are defined in the Investment Company Act of  1940, as amended.

(ff)           Form SB-2 Eligibility.  The Company is eligible to register the
Conversion Shares and the Warrant Shares for resale by the Buyers using Form
SB-2 promulgated under the 1933 Act.

(gg)         Transfer Taxes.  On the Closing Date, all stock transfer or other
taxes (other than income or similar taxes) which are required to be paid in
connection with the sale and transfer of the Securities to be sold to each Buyer
hereunder will be, or will have been, fully paid or provided for by the Company,
and all laws imposing such taxes will be or will have been complied with.

(hh)         Manipulation of Price.  The Company has not, and to its knowledge
no one acting on its behalf has, (i) taken, directly or indirectly, any action
designed to cause or to result, or that could reasonably be expected to cause or
result, in the stabilization or manipulation of the price of any security of the
Company to facilitate the sale or resale of any of the Securities, (ii) other
than the Agent, sold, bid for, purchased, or paid any compensation for
soliciting purchases of, any of the Securities, or (iii) paid or agreed to pay
to any person any compensation for soliciting another to purchase any other
securities of the Company.

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(ii)            U.S. Real Property Holding Corporation.  The Company is not, nor
has it ever been, a U.S. real property holding corporation within the meaning of
Section 897 of the Internal Revenue Code of 1986, as amended, and the Company
shall so certify upon any Buyer's request.

(jj)            Bank Holding Company Act.  Neither the Company nor any of its
Subsidiaries is subject to the Bank Holding Company Act of 1956, as amended (the
"BHCA") and to regulation by the Board of Governors of the Federal Reserve
System (the "Federal Reserve").  Neither the Company nor any of its Subsidiaries
or affiliates owns or controls, directly or indirectly, five percent (5%) or
more of the outstanding shares of any class of voting securities or twenty-five
(25%) or more of the total equity of a bank or any  equity that is subject to
the BHCA and to regulation by the Federal Reserve.  Neither the Company nor any
of its Subsidiaries or affiliates exercises a controlling influence over the
management or policies of a bank or any entity that is subject to the BHCA and
to regulation by the Federal Reserve.

(kk)          Disclosure.  The Company confirms that neither it nor any other
Person acting on its behalf has provided any of the Buyers or their agents or
counsel with any information that constitutes or could reasonably be expected to
constitute material, nonpublic information.  The Company understands and
confirms that each of the Buyers will rely on the foregoing representations in
effecting transactions in securities of the Company.  All disclosure provided to
the Buyers regarding the Company or any of its Subsidiaries, their business and
the transactions contemplated hereby, including the Schedules to this Agreement,
furnished by or on behalf of the Company is true and correct and does not
contain any untrue statement of a material fact or omit to state any material
fact necessary in order to make the statements made therein, in the light of the
circumstances under which they were made, not misleading.  Each press release
issued by the Company or any of its Subsidiaries during the twelve (12) months
preceding the date of this Agreement did not at the time of release contain any
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading.  No event
or circumstance has occurred or information exists with respect to the Company
or any of its Subsidiaries or its or their business, properties, prospects,
operations or financial conditions, which, under applicable law, rule or
regulation, requires public disclosure or announcement by the Company but which
has not been so publicly announced or disclosed.
 
(ll)            Acknowledgement Regarding Buyers' Trading Activity.  Anything in
this Agreement or elsewhere herein to the contrary notwithstanding, but subject
to compliance by the Buyers with applicable law and the provisions of Section
2(k) hereto, it is understood and acknowledged by the Company (i) that none of
the Buyers have been asked by the Company or its Subsidiaries to agree, nor has
any Buyer agreed with the Company or its Subsidiaries, to desist from purchasing
or selling, long and/or short, securities of the Company, or "derivative"
securities based on securities issued by the Company or to hold the Securities
for any specified term; (ii) that past or future open market or other
transactions by any Buyer, including, without limitation, short sales or
"derivative" transactions, before or after the closing of this or future private
placement transactions, may negatively impact the market price of the Company's
publicly-traded securities; (iii) that any Buyer, and counter parties in
"derivative" transactions to which any such Buyer is a party, directly or
indirectly, presently may have a "short" position in the Common Stock, and (iv)
that each Buyer shall not be deemed to have any affiliation with or control over
any arm's length counter-party in any "derivative" transaction.  The Company
further understands and acknowledges that (a) one or more Buyers may engage in
hedging and/or trading activities at various times during the period that the
Securities are outstanding, including, without limitation, during the periods
that the value of the Conversion Shares and the Warrant Shares deliverable with
respect to Securities are being determined and (b) such hedging and/or trading
activities (if any) can reduce the value of the existing stockholders' equity
interest in the Company at and after the time the hedging and/or trading
activities are being conducted.  The Company acknowledges that such
aforementioned hedging and/or trading activities do not constitute a breach of
this Agreement, the Notes, the Warrants or any of the documents executed in
connection herewith.

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4.             COVENANTS.

(a)            Best Efforts.  Each party shall use its best efforts timely to
satisfy each of the conditions to be satisfied by it as provided in Sections 6
and 7 of this Agreement.

(b)            Form D and Blue Sky.  The Company agrees to file a Form D, if
required under U.S. securities laws, with respect to the Securities as required
under Regulation D and to provide a copy thereof to each Buyer promptly after
such filing.  The Company shall, on or before the Closing Date, take such action
as the Company shall reasonably determine is necessary in order to obtain an
exemption for or to qualify the Securities for sale to the Buyers at the Closing
pursuant to this Agreement under applicable securities or "Blue Sky" laws of the
states of the United States (or to obtain an exemption from such qualification),
and shall provide evidence of any such action so taken to the Buyers on or prior
to the Closing Date.  The Company shall make all filings and reports relating to
the offer and sale of the Securities required under applicable securities or
"Blue Sky" laws of the states of the United States following the Closing Date.

(c)            Reporting Status.  Until the date on which the Investors (as
defined in the Registration Rights Agreement) shall have sold all the Conversion
Shares and Warrant Shares and none of the Notes or Warrants is outstanding, (the
"Reporting Period"), the Company shall timely file all reports required to be
filed with the SEC pursuant to the 1934 Act, and the Company shall not terminate
its status as an issuer required to file reports under the 1934 Act even if the
1934 Act or the rules and regulations thereunder would no longer require or
otherwise permit such termination, and the Company shall take all actions
necessary to maintain its eligibility to register the Conversion Shares and
Warrant Shares for resale by the Buyers on Form SB-2.

(d)            Use of Proceeds.  The Company will use the proceeds from the sale
of the Securities for general corporate purposes, including general and
administrative expenses and not for (i) the repayment of any outstanding
Indebtedness of the Company or any of its Subsidiaries or (ii) the redemption or
repurchase of any of its or its Subsidiaries' equity securities.

(e)            Financial Information.  As long as any Notes or Warrants are
outstanding, the Company agrees to send the following to each Investor (as
defined in the Registration Rights Agreement) during the Reporting Period (i)
unless the following are filed with the SEC through EDGAR and are available to
the public through the EDGAR system, within one (1) Business Day after the
filing thereof with the SEC, a copy of its Annual Reports and Quarterly Reports
on Form 10-K, 10-KSB, 10-Q or 10-QSB, any interim reports or any consolidated
balance sheets, income statements, stockholders' equity statements and/or cash
flow statements for any period other than annual, any Current Reports on Form
8-K and any registration statements (other than on Form S-8) or amendments filed
pursuant to the 1933 Act, (ii) on the same day as the release thereof, facsimile
or e-mailed copies of all press releases issued by the Company or any of its
Subsidiaries, and (iii) copies of any notices and other information made
available or given to the stockholders of the Company generally,
contemporaneously with the making available or giving thereof to the
stockholders.  As used herein, "Business Day" means any day other than Saturday,
Sunday or other day on which commercial banks in The City of New York are
authorized or required by law to remain closed.

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(f)             Listing.  The Company shall promptly secure the listing of all
of the Registrable Securities (as defined in the Registration Rights Agreement)
upon each national securities exchange and automated quotation system, if any,
upon which the Common Stock is then listed (subject to official notice of
issuance) and shall maintain, in accordance with the Notes and Warrants, such
listing of all Registrable Securities from time to time issuable under the terms
of the Transaction Documents.  The Company shall maintain the Common Stocks'
authorization for quotation on the Principal Market.  Neither the Company nor
any of its Subsidiaries shall take any action which would be reasonably expected
to result in the delisting or suspension of the Common Stock on the Principal
Market.  The Company shall pay all fees and expenses in connection with
satisfying its obligations under this Section 4(f).

(g)            Fees.  Subject to Section 8 below, at Closing, the Company shall
pay an expense allowance to Highbridge International LLC (a Buyer) or its
designee(s) (in addition to any other expense amounts paid to any Buyer prior to
the date of this Agreement) for all reasonable costs and expenses incurred in
connection with the transactions contemplated by the Transaction Documents
(including all reasonable legal fees and disbursements in connection therewith,
documentation and implementation of the transactions contemplated by the
Transaction Documents and due diligence in connection therewith), in the amount
of $90,000, which amount shall be withheld by such Buyer from its Purchase Price
at the Closing.  The Company shall be responsible for the payment of any
placement agent's fees, financial advisory fees, or broker's commissions
relating to or arising out of the transactions contemplated hereby, including,
without limitation, any fees payable to the Agent.  The Company shall pay, and
hold each Buyer harmless against, any liability, loss or expense (including,
without limitation, reasonable attorney's fees and out-of-pocket expenses)
arising in connection with any claim relating to any such payment.

(h)            Pledge of Securities.  The Company acknowledges and agrees that
the Securities may be pledged by an Investor (as defined in the Registration
Rights Agreement) in connection with a bona fide margin agreement or other loan
or financing arrangement that is secured by the Securities.  The pledge of
Securities shall not be deemed to be a transfer, sale or assignment of the
Securities hereunder, and no Investor effecting a pledge of Securities shall be
required to provide the Company with any notice thereof or otherwise make any
delivery to the Company pursuant to this Agreement or any other Transaction
Document, including, without limitation, Section 2(f) hereof; provided that an
Investor and its pledgee shall be required to comply with the provisions of
Section 2(f) hereof in order to effect a sale, transfer or assignment of
Securities to such pledgee.  The Company hereby agrees to execute and deliver
such documentation as a pledgee of the Securities may reasonably request in
connection with a pledge of the Securities to such pledgee by an Investor.

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(i)             Disclosure of Transactions and Other Material Information.  On
or before 8:30 a.m., New York City time, on the first Business Day following the
date of this Agreement, the Company shall issue a press release and file a
Current Report on Form 8-K describing the terms of the transactions contemplated
by the Transaction Documents in the form required by the 1934 Act and attaching
the material Transaction Documents (including, without limitation, this
Agreement, the form of the Notes, the form of Warrant and the form of the
Registration Rights Agreement) as exhibits to such filing (including all
attachments, the "8-K Filing").  From and after the filing of the 8-K Filing
with the SEC, no Buyer shall be in possession of any material, nonpublic
information received from the Company, any of its Subsidiaries or any of their
respective officers, directors, employees or agents, that is not disclosed in
the 8-K Filing.  The Company shall not, and shall cause each of its Subsidiaries
and its and each of their respective officers, directors, employees and agents,
not to, provide any Buyer with any material, nonpublic information regarding the
Company or any of its Subsidiaries from and after the filing of the 8-K Filing
with the SEC without the express prior written consent of such Buyer.  If a
Buyer has, or believes it has, received any such material, nonpublic information
regarding the Company or any of its Subsidiaries, it shall provide the Company
with written notice thereof.  The Company shall, within five (5) Trading Days
(as defined in the Notes) of receipt of such notice, make public disclosure of
such material, nonpublic information.  In the event of a breach of the foregoing
covenant by the Company, any of its Subsidiaries, or any of its or their
respective officers, directors, employees and agents, in addition to any other
remedy provided herein or in the Transaction Documents, a Buyer shall have the
right to make a public disclosure, in the form of a press release, public
advertisement or otherwise, of such material, nonpublic information without the
prior approval by the Company, its Subsidiaries, or any of its or their
respective officers, directors, employees or agents.  No Buyer shall have any
liability to the Company, its Subsidiaries, or any of its or their respective
officers, directors, employees, stockholders or agents for any such
disclosure.  Subject to the foregoing, neither the Company, its Subsidiaries nor
any Buyer shall issue any press releases or any other public statements with
respect to the transactions contemplated hereby; provided, however, that the
Company shall be entitled, without the prior approval of any Buyer, to make any
press release or other public disclosure with respect to such transactions (i)
in substantial conformity with the 8-K Filing and contemporaneously therewith
and (ii) as is required by applicable law and regulations (provided that in the
case of clause (i) each Buyer shall be consulted by the Company in connection
with any such press release or other public disclosure prior to its
release).  Without the prior written consent of any applicable Buyer, neither
the Company nor any of its Subsidiaries or affiliates shall disclose the name of
such Buyer in any filing, announcement, release or otherwise.

(j)             Restriction on Redemption and Cash Dividends.  So long as any
Notes are outstanding, the Company shall not, directly or indirectly, redeem, or
declare or pay any cash dividend or distribution on, the Common Stock without
the prior express written consent of the holders of Notes representing not less
than a majority of the aggregate principal amount of the then outstanding Notes.

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(k)            Additional Notes; Variable Securities; Dilutive Issuances.  So
long as any Buyer beneficially owns any Securities, the Company will not issue
any Notes other than to the Buyers as contemplated hereby and the Company shall
not issue any other securities that would cause a breach or default under the
Notes.  For so long as any Notes or Warrants remain outstanding, the Company
shall not, in any manner, issue or sell any rights, warrants or options to
subscribe for or purchase Common Stock or directly or indirectly convertible
into or exchangeable or exercisable for Common Stock at a price which varies or
may vary with the market price of the Common Stock, including by way of one or
more reset(s) to any fixed price unless the conversion, exchange or exercise
price of any such security cannot be less than the then applicable Conversion
Price (as defined in the Notes)with respect to the Common Stock into which any
Note is convertible or the then applicable Exercise Price (as defined in the
Warrants) with respect to the Common Stock into which any Warrant is
exercisable.  For so long as any Notes or Warrants remain outstanding, the
Company shall not, in any manner, enter into or affect any Dilutive Issuance (as
defined in the Notes) if the effect of such Dilutive Issuance is to cause the
Company to be required to issue upon conversion of any Note or exercise of any
Warrant any shares of Common Stock in excess of that number of shares of Common
Stock which the Company may issue upon conversion of the Notes and exercise of
the Warrants without breaching the Company's obligations under the rules or
regulations of the Principal Market.

(l)             Corporate Existence.  So long as any Buyer beneficially owns any
Securities, the Company shall not be party to any Fundamental Transaction (as
defined in the Notes) unless the Company is in compliance with the applicable
provisions governing Fundamental Transactions set forth in the Notes and the
Warrants.

(m)         Reservation of Shares.  The Company shall take all action necessary
to at all times have authorized, and reserved for the purpose of issuance, no
less than 130% of the sum of  the number of shares of Common Stock issuable (i)
upon conversion of the Notes issued at the Closing and (ii) upon exercise of the
Warrants issued at the Closing (without taking into account any limitations on
the Conversion of the Notes or exercise of the Warrants set forth in the Notes
and Warrants, respectively).

(n)            Conduct of Business.  The business of the Company and its
Subsidiaries shall not be conducted in violation of any law, ordinance or
regulation of any governmental entity, except where such violations would not
result, either individually or in the aggregate, in a Material Adverse Effect.

(o)            Additional Issuances of Securities.

(i)           For purposes of this Section 4(o), the following definitions shall
apply.

(1)           "Convertible Securities" means any stock or securities (other than
Options) convertible into or exercisable or exchangeable for shares of Common
Stock.

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

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(3)           "Common Stock Equivalents" means, collectively, Options and
Convertible Securities.

(ii)           From the date hereof until the date that is thirty (30) Trading
Days (as defined in the Notes) following the Effective Date (as defined in the
Registration Rights Agreement) (the "Trigger Date"), the Company will not,
directly or indirectly, file any registration statement with the SEC other than
the Registration Statement (as defined in the Registration Rights
Agreement).  From the date hereof until the Trigger Date, the Company will not,
directly or indirectly, offer, sell, grant any option to purchase, or otherwise
dispose of (or announce any offer, sale, grant or any option to purchase or
other disposition of) any of its or its Subsidiaries' equity or equity
equivalent securities, including without limitation any debt, preferred stock or
other instrument or security that is, at any time during its life and under any
circumstances, convertible into or exchangeable or exercisable for shares of
Common Stock or Common Stock Equivalents (any such offer, sale, grant,
disposition or announcement being referred to as a "Subsequent Placement").

(iii)           From the Trigger Date until the later of (x) the second
anniversary of the Closing Date, and (y) such time as there no longer any Notes,
the Company will not, directly or indirectly, effect any Subsequent Placement
unless the Company shall have first complied with this Section 4(o)(iii).

(1)           The Company shall deliver to each Buyer an irrevocable written
notice (the "Offer Notice") of any proposed or intended issuance or sale or
exchange (the "Offer") of the securities being offered (the "Offered
Securities") in a Subsequent Placement, which Offer Notice shall (w) identify
and describe the Offered Securities, (x) describe the price and other terms upon
which they are to be issued, sold or exchanged, and the number or amount of the
Offered Securities to be issued, sold or exchanged, (y) identify the persons or
entities (if known) to which or with which the Offered Securities are to be
offered, issued, sold or exchanged and (z) offer to issue and sell to or
exchange with such Buyers at least fifty percent (50%) of the Offered
Securities, allocated among such Buyers (a) based on such Buyer's pro rata
portion of the aggregate principal amount of Notes purchased hereunder (the
"Basic Amount"), and (b) with respect to each Buyer that elects to purchase its
Basic Amount, any additional portion of the Offered Securities attributable to
the Basic Amounts of other Buyers as such Buyer shall indicate it will purchase
or acquire should the other Buyers subscribe for less than their Basic Amounts
(the "Undersubscription Amount"), which process shall be repeated until the
Buyers shall have an opportunity to subscribe for any remaining
Undersubscription Amount.

(2)           To accept an Offer, in whole or in part, such Buyer must deliver a
written notice to the Company prior to the end of the tenth (10th) Business Day
after such Buyer's receipt of the Offer Notice (the "Offer Period"), setting
forth the portion of such Buyer's Basic Amount that such Buyer elects to
purchase and, if such Buyer shall elect to purchase all of its Basic Amount, the
Undersubscription Amount, if any, that such Buyer elects to purchase (in either
case, the "Notice of Acceptance").  If the Basic Amounts subscribed for by all
Buyers are less than the total of all of the Basic Amounts, then each Buyer who
has set forth an Undersubscription Amount in its Notice of Acceptance shall be
entitled to purchase, in addition to the Basic Amounts subscribed for, the
Undersubscription Amount it has subscribed for; provided, however, that if the
Undersubscription Amounts subscribed for exceed the difference between the total
of all the Basic Amounts and the Basic Amounts subscribed for (the "Available
Undersubscription Amount"), each Buyer who has subscribed for any
Undersubscription Amount shall be entitled to purchase only that portion of the
Available Undersubscription Amount as the Basic Amount of such Buyer bears to
the total Basic Amounts of all Buyers that have subscribed for Undersubscription
Amounts, subject to rounding by the Company to the extent it deems reasonably
necessary. Notwithstanding the foregoing, if the Company desires to modify or
amend the terms and conditions of the Offer prior to the expiration of the Offer
Period, the Company may deliver to the Buyers a new Offer Notice and the Offer
Period shall expire on the third Business Day after such Buyer’s receipt of such
new Offer Notice.

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(3)           The Company shall have fifteen (15) Business Days from the
expiration of the Offer Period above to offer, issue, sell or exchange all or
any part of such Offered Securities as to which a Notice of Acceptance has not
been given by the Buyers (the "Refused Securities"), but only to the offerees
described in the Offer Notice (if so described therein) and only upon terms and
conditions (including, without limitation, unit prices and interest rates) that
are not more favorable to the acquiring person or persons or less favorable to
the Company than those set forth in the Offer Notice and (ii) to publicly
announce (a) the execution of such Subsequent Placement Agreement, and (b)
either (x) the consummation of the transactions contemplated by such Subsequent
Placement Agreement or (y) the termination of such Subsequent Placement
Agreement, which shall be filed with the SEC on a Current Report on Form 8-K
with such Subsequent Placement Agreement and any documents contemplated therein
filed as exhibits thereto.

(4)           In the event the Company shall propose to sell less than all the
Refused Securities (any such sale to be in the manner and on the terms specified
in Section 4(o)(iii)(3) above), then each Buyer may, at its sole option and in
its sole discretion, reduce the number or amount of the Offered Securities
specified in its Notice of Acceptance to an amount that shall be not less than
the number or amount of the Offered Securities that such Buyer elected to
purchase pursuant to Section 4(o)(iii)(2) above multiplied by a fraction, (i)
the numerator of which shall be the number or amount of Offered Securities the
Company actually proposes to issue, sell or exchange (including Offered
Securities to be issued or sold to Buyers pursuant to Section 4(o)(iii)(3) above
prior to such reduction) and (ii) the denominator of which shall be the original
amount of the Offered Securities.  In the event that any Buyer so elects to
reduce the number or amount of Offered Securities specified in its Notice of
Acceptance, the Company may not issue, sell or exchange more than the reduced
number or amount of the Offered Securities unless and until such securities have
again been offered to the Buyers in accordance with Section 4(o)(iii)(1) above.

(5)           Upon the closing of the issuance, sale or exchange of all or less
than all of the Refused Securities, the Buyers shall acquire from the Company,
and the Company shall issue to the Buyers, the number or amount of Offered
Securities specified in the Notices of Acceptance, as reduced pursuant to
Section 4(o)(iii)(4) above if the Buyers have so elected, upon the terms and
conditions specified in the Offer.  Notwithstanding anything to the contrary
contained in this Agreement, if the Company does not consummate the closing of
the issuance, sale or exchange of all or less than all of the Refused Securities
within fifteen (15) Business Days of the expiration of the Offer Period, the
Company shall issue to the Buyers the number or amount of Offered Securities
specified in the Notices of Acceptance, as reduced pursuant to Section
4(o)(iii)(4) above if the Buyers have so elected, upon the terms and conditions
specified in the Offer.  The purchase by the Buyers of any Offered Securities is
subject in all cases to the preparation, execution and delivery by the Company
and the Buyers of a purchase agreement relating to such Offered Securities
reasonably satisfactory in form and substance to the Buyers and their respective
counsel.

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(6)           Any Offered Securities not acquired by the Buyers or other persons
in accordance with Section 4(o)(iii)(3) above may not be issued, sold or
exchanged until they are again offered to the Buyers under the procedures
specified in this Agreement.

(7)           The Company and the Buyers agree that if any Buyer elects to
participate in the Offer, (x) neither the agreement regarding the Subsequent
Placement (the "Subsequent Placement Agreement") with respect to such Offer nor
any other transaction documents related thereto (collectively, the "Subsequent
Placement Documents") shall include any term or provisions whereby any Buyer
shall be required to agree to any restrictions in trading as to any securities
of the Company owned by such Buyer prior to such Subsequent Placement, and (y)
any registration rights set forth in such Subsequent Placement Documents shall
be similar in all material respects to the registration rights contained in the
Registration Rights Agreement.

(8)           Notwithstanding anything to the contrary in this Section 4(o) and
unless otherwise agreed to by the Buyers, the Company shall either confirm in
writing to the Buyers that the transaction with respect to the Subsequent
Placement has been abandoned or shall publicly disclose its intention to issue
the Offered Securities, in either case in such a manner such that the Buyers
will not be in possession of material non-public information, by the fifteen
(15th) Business Day following delivery of the Offer Notice.  If by the fifteen
(15th) Business Day following delivery of the Offer Notice no public disclosure
regarding a transaction with respect to the Offered Securities has been made,
and no notice regarding the abandonment of such transaction has been received by
the Buyers, such transaction shall be deemed to have been abandoned and the
Buyers shall not be deemed to be in possession of any material, non-public
information with respect to the Company.  Should the Company decide to pursue
such transaction with respect to the Offered Securities, the Company shall
provide each Buyer with another Offer Notice and each Buyer will again have the
right of participation set forth in this Section 4(o)(iii).  The Company shall
not be permitted to deliver more than one such Offer Notice to the Buyers in any
60 day period.

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(iv)           The restrictions contained in subsections (ii) and (iii) of this
Section 4(o) shall not apply in connection with the issuance of any Excluded
Securities (as defined in the Notes).

(p)           Closing Documents.  On or prior to fourteen (14) calendar days
after the Closing Date, the Company agrees to deliver, or cause to be delivered,
to each Buyer and Schulte Roth & Zabel LLP executed copies of the Transaction
Documents, Securities and other document required to be delivered to any party
pursuant to Section 7 hereof.

(q)           Lock-Up.  The Company shall not amend or waive any provision of
any of the Lock-Up Agreements (as defined below) except to extend the term of
the lock-up period.

(r)            No Reverse Split.  For so long as any Securities remain
outstanding the Company shall not effect any reverse stock split, stock
combination or other similar reclassification of any class of the Company's
Common Stock.

5.             REGISTER; TRANSFER AGENT INSTRUCTIONS.

(a)            Register.  The Company shall maintain at its principal executive
offices (or such other office or agency of the Company as it may designate by
notice to each holder of Securities), a register for the Notes and the Warrants
in which the Company shall record the name and address of the Person in whose
name the Notes and the Warrants have been issued (including the name and address
of each transferee), the principal amount of Notes held by such Person, the
number of Conversion Shares issuable upon conversion of the Notes and the number
of Warrant Shares issuable upon exercise of the Warrants held by such
Person.  The Company shall keep the register open and available at all times
during business hours for inspection of any Buyer or its legal representatives.

(b)            Transfer Agent Instructions.  The Company shall issue irrevocable
instructions to its transfer agent, and any subsequent transfer agent, to issue
certificates or credit shares to the applicable balance accounts at The
Depository Trust Company ("DTC"), registered in the name of each Buyer or its
respective nominee(s), for the Conversion Shares and the Warrant Shares issued
at the Closing or upon conversion of the Notes or exercise of the Warrants in
such amounts as specified from time to time by each Buyer to the Company upon
conversion of the Notes or exercise of the Warrants in the form of Exhibit D
attached hereto (the "Irrevocable Transfer Agent Instructions").  The Company
warrants that no instruction other than the Irrevocable Transfer Agent
Instructions referred to in this Section 5(b), and stop transfer instructions to
give effect to Section 2(g) hereof, will be given by the Company to its transfer
agent, and that the Securities shall otherwise be freely transferable on the
books and records of the Company as and to the extent provided in this Agreement
and the other Transaction Documents.  If a Buyer effects a sale, assignment or
transfer of the Securities in accordance with Section 2(f), the Company shall
permit the transfer and shall promptly instruct its transfer agent to issue one
or more certificates or credit shares to the applicable balance accounts at DTC
in such name and in such denominations as specified by such Buyer to effect such
sale, transfer or assignment.  In the event that such sale, assignment or
transfer involves Conversion Shares or Warrant Shares sold, assigned or
transferred pursuant to an effective registration statement or pursuant to Rule
144, the transfer agent shall issue such Securities to the Buyer, assignee or
transferee, as the case may be, without any restrictive legend.  The Company
acknowledges that a breach by it of its obligations hereunder will cause
irreparable harm to a Buyer.  Accordingly, the Company acknowledges that the
remedy at law for a breach of its obligations under this Section 5(b) will be
inadequate and agrees, in the event of a breach or threatened breach by the
Company of the provisions of this Section 5(b), that a Buyer shall be entitled
to seek, in addition to all other available remedies, an order and/or injunction
restraining any breach and requiring immediate issuance and transfer, without
the necessity of showing economic loss and without any bond or other security
being required.

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6.             CONDITIONS TO THE COMPANY'S OBLIGATION TO SELL.

The obligation of the Company hereunder to issue and sell the Notes and the
related Warrants to each Buyer at the Closing is subject to the satisfaction, at
or before the Closing Date, 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 by providing each Buyer with prior
written notice thereof:

 (i)            Such Buyer shall have executed each of the Transaction Documents
to which it is a party and delivered the same to the Company.

(ii)            Such Buyer and each other Buyer shall have delivered to the
Company the Purchase Price (less, in the case of Highbridge International LLC,
the amounts withheld pursuant to Section 4(g)) for the Notes and the related
Warrants being purchased by such Buyer at the Closing by wire transfer of
immediately available funds pursuant to the wire instructions provided by the
Company or by surrender of such Buyer's Existing Debentures as contemplated by
the Exchange Agreement.

(iii)           The representations and warranties of such Buyer shall be true
and correct in all material respects (except for those representations and
warranties that are qualified by materiality or Material Adverse Effect, which
shall be true and correct in all respects) as of the date when made and as of
the Closing Date as though made at that time (except for representations and
warranties that speak as of a specific date, which shall be true and correct as
of such specified date), and such 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 such
Buyer at or prior to the Closing Date.

7.             CONDITIONS TO EACH BUYER'S OBLIGATION TO PURCHASE.

The obligation of each Buyer hereunder to purchase the Notes and the related
Warrants at the Closing is subject to the satisfaction, at or before the Closing
Date, of each of the following conditions, provided that these conditions are
for each Buyer's sole benefit and may be waived by such Buyer at any time in its
sole discretion by providing the Company with prior written notice thereof:

(i)           The Company shall have duly executed and delivered to such Buyer
(i) each of the Transaction Documents and (ii) the Notes (allocated in such
principal amounts as such Buyer shall request), being purchased by such Buyer at
the Closing pursuant to this Agreement, and (iii) the related Warrants
(allocated in such amounts as such Buyer shall request) being purchased by such
Buyer at the Closing pursuant to this Agreement.

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(ii)          Such Buyer shall have received the opinion of Andrew N. Bernstein,
P.C., the Company's outside counsel, dated as of the Closing Date, in
substantially the form of Exhibit E attached hereto.

(iii)         The Company shall have delivered to such Buyer a copy of the
Irrevocable Transfer Agent Instructions, in the form of Exhibit D attached
hereto, which instructions shall have been delivered to and acknowledged in
writing by the Company's transfer agent.

(iv)        The Company shall have delivered to such Buyer a
certificate  evidencing the formation and good standing of the Company and each
of its Subsidiaries in such entity's jurisdiction of formation issued by the
Secretary of State (or comparable office) of such jurisdiction, as of a date
within ten (10) days of the Closing Date.

(v)         The Company shall have delivered to such Buyer a
certificate  evidencing the Company's qualification as a foreign corporation and
good standing issued by the Secretary of State (or comparable office) of each
jurisdiction in which the Company conducts business, as of a date within ten
(10) days of the Closing Date.

(vi)        The Company shall have delivered to such Buyer a certified copy of
the Articles of Incorporation as certified by the Secretary of State of the
State of Nevada  within ten (10) days of the Closing Date.

(vii)       The Company shall have delivered to such Buyer a certificate,
executed by the Secretary of the Company and dated as of the Closing Date, as to
(i) the resolutions consistent with Section 3(b) as adopted by the Company's
Board of Directors in a form reasonably acceptable to such Buyer, (ii) the
Articles of Incorporation and (iii) the Bylaws, each as in effect at the
Closing, in the form attached hereto as Exhibit F.

(viii)      The representations and warranties of the Company shall be true and
correct in all material respects (except for those representations and
warranties that are qualified by materiality or Material Adverse Effect, which
shall be true and correct in all respects) as of the date when made and as of
the Closing Date as though made at that time (except for representations and
warranties that speak as of a specific date, which shall be true and correct as
of such specified date) and the Company shall have performed, satisfied and
complied in all material respects with the covenants, agreements and conditions
required by the Transaction Documents to be performed, satisfied or complied
with by the Company at or prior to the Closing Date.  Such Buyer shall have
received a certificate, executed by the Chief Executive Officer of the Company,
dated as of the Closing Date, to the foregoing effect and as to such other
matters as may be reasonably requested by such Buyer in the form attached hereto
as Exhibit G.

(ix)         The Company shall have delivered to such Buyer a letter from the
Company's transfer agent certifying the number of shares of Common Stock
outstanding as of a date within five days of the Closing Date.

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(x)          The Common Stock (I) shall be designated for quotation or listed on
the Principal Market and (II) shall not have been suspended, as of the Closing
Date, by the SEC or the Principal Market from trading on the Principal Market
nor shall suspension by the SEC or the Principal Market have been threatened, as
of the Closing Date, either (A) in writing by the SEC or the Principal Market or
(B) by falling below the minimum listing maintenance requirements of the
Principal Market.

(xi)         The Company shall have obtained all governmental, regulatory or
third party consents and approvals, if any, necessary for the sale of the
Securities.

(xii)        In accordance with the terms of the Security Documents, the Company
shall have delivered to the Collateral Agent (i) certificates representing the
Subsidiaries' shares of capital stock to the extent such subsidiary is a
corporation or otherwise has certificated capital stock, along with duly
executed blank stock powers and (ii) appropriate financing statements on Form
UCC-1 to be duly filed in such office or offices as may be necessary or, in the
opinion of the Collateral Agent, desirable to perfect the security interests
purported to be created by each Security Document.

(xiii)       Within two (2) Business Days prior to the Closing, the Company
shall have delivered or caused to be delivered to each Buyer (i) true copies of
UCC search results, listing all effective financing statements which name as
debtor the Company or any of its Subsidiaries filed in the prior five years to
perfect an interest in any assets thereof, together with copies of such
financing statements, none of which, except as otherwise agreed in writing by
the Buyers, shall cover any of the Collateral (as defined in the Security
Documents) and the results of searches for any tax lien and judgment lien filed
against such Person or its property, which results, except as otherwise agreed
to in writing by the Buyers shall not show any such Liens (as defined in the
Security Documents); and (ii) a perfection certificate, duly completed and
executed by the Company and each of its Subsidiaries, in form and substance
satisfactory to the Buyers.

(xiv)       Sam Jankovich, Private Capital Group LLC and Dean Galland shall have
entered into a Lock-Up Agreement in the form attached hereto as Exhibit J (the
"Lock-Up Agreement").

(xv)        The Collateral Agent and each other Buyer shall have duly executed
and delivered to such Buyer the Collateral Agency Agreement.

(xvi)       The Company shall have delivered to such Buyer such other documents
relating to the transactions contemplated by this Agreement as such Buyer or its
counsel may reasonably request.

8.             TERMINATION.  In the event that the Closing shall not have
occurred with respect to a Buyer on or before five (5) Business Days from the
date hereof due to the Company's or such Buyer's failure to satisfy the
conditions set forth in Sections 6 and 7 above (and the nonbreaching party's
failure to waive such unsatisfied condition(s)), the nonbreaching party shall
have the option to terminate this Agreement with respect to such breaching party
at the close of business on such date without liability of any party to any
other party; provided, however, that if this Agreement is terminated pursuant to
this Section 8, the Company shall remain obligated to reimburse the
non-breaching Buyers for the expenses described in Section 4(g) above.

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9.             MISCELLANEOUS.

(a)           Governing Law; Jurisdiction; Jury Trial.  All questions concerning
the construction, validity, enforcement and interpretation of this Agreement
shall be governed by the internal laws of the State of New York, without giving
effect to any choice of law or conflict of law provision or rule (whether of the
State of New York or any other jurisdictions) that would cause the application
of the laws of any jurisdictions other than the State of New York.  Each party
hereby irrevocably submits to the exclusive jurisdiction of the state and
federal courts sitting in The City of New York, Borough of Manhattan, for the
adjudication of any dispute hereunder or in connection herewith or with any
transaction contemplated hereby or discussed herein, and hereby irrevocably
waives, and agrees not to assert in any suit, action or proceeding, any claim
that it is not personally subject to the jurisdiction of any such court, that
such suit, action or proceeding is brought in an inconvenient forum or that the
venue of such suit, action or proceeding is improper.  Each party hereby
irrevocably waives personal service of process and consents to process being
served in any such suit, action or proceeding by mailing a copy thereof to such
party at the address for such notices to it under this Agreement and agrees that
such service shall constitute good and sufficient service of process and notice
thereof.  Nothing contained herein shall be deemed to limit in any way any right
to serve process in any manner permitted by law.  EACH PARTY HEREBY IRREVOCABLY
WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE
ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION WITH OR ARISING OUT OF
THIS AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREBY.

(b)           Counterparts.  This Agreement may be executed in two or more
identical counterparts, all of which shall be considered one and the same
agreement and shall become effective when counterparts have been signed by each
party and delivered to the other party; provided that a facsimile signature
shall be considered due execution and shall be binding upon the signatory
thereto with the same force and effect as if the signature were an original, not
a facsimile signature.

(c)           Headings.  The headings of this Agreement are for convenience of
reference and shall not form part of, or affect the interpretation of, this
Agreement.

(d)           Severability.  If any provision of this Agreement is prohibited by
law or otherwise determined to be invalid or unenforceable by a court of
competent jurisdiction, the provision that would otherwise be prohibited,
invalid or unenforceable shall be deemed amended to apply to the broadest extent
that it would be valid and enforceable, and the invalidity or unenforceability
of such provision shall not affect the validity of the remaining provisions of
this Agreement so long as this Agreement as so modified continues to express,
without material change, the original intentions of the parties as to the
subject matter hereof and the prohibited nature, invalidity or unenforceability
of the provision(s) in question does not substantially impair the respective
expectations or reciprocal obligations of the parties or the practical
realization of the benefits that would otherwise be conferred upon the
parties.  The parties will endeavor in good faith negotiations to replace the
prohibited, invalid or unenforceable provision(s) with a valid provision(s), the
effect of which comes as close as possible to that of the prohibited, invalid or
unenforceable provision(s).

- 29 -

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(e)           Entire Agreement; Amendments.  This Agreement and the other
Transaction Documents supersede all other prior oral or written agreements
between the Buyers, the Company, their affiliates and Persons acting on their
behalf with respect to the matters discussed herein, and this Agreement, the
other Transaction Documents and the instruments referenced herein and therein
contain the entire understanding of the parties with respect to the matters
covered herein and therein and, except as specifically set forth herein or
therein, neither the Company nor any Buyer makes any representation, warranty,
covenant or undertaking with respect to such matters.  No provision of this
Agreement may be amended other than by an instrument in writing signed by the
Company and the holders of at least a majority of the aggregate number of
Registrable Securities issued and issuable hereunder and under the Notes, and
any amendment to this Agreement made in conformity with the provisions of this
Section 9(e) shall be binding on all Buyers and holders of Securities as
applicable.  No provision hereof may be waived other than by an instrument in
writing signed by the party against whom enforcement is sought.  No such
amendment shall be effective to the extent that it applies to less than all of
the holders of the applicable Securities then outstanding.  No consideration
shall be offered or paid to any Person to amend or consent to a waiver or
modification of any provision of any of the Transaction Documents unless the
same consideration also is offered to all of the parties to the Transaction
Documents, holders of Notes or holders of the Warrants, as the case may be.  The
Company has not, directly or indirectly, made any agreements with any Buyers
relating to the terms or conditions of the transactions contemplated by the
Transaction Documents except as set forth in the Transaction Documents.  Without
limiting the foregoing, the Company confirms that, except as set forth in this
Agreement, no Buyer has made any commitment or promise or has any other
obligation to provide any financing to the Company or otherwise.

(f)           Notices.  Any notices, consents, waivers or other communications
required or permitted to be given under the terms of this Agreement must be in
writing and will be deemed to have been delivered:  (i) upon receipt, when
delivered personally; (ii) upon receipt, when sent by facsimile (provided
confirmation of transmission is mechanically or electronically generated and
kept on file by the sending party); or (iii) one Business Day after deposit with
an overnight courier service, in each case properly addressed to the party to
receive the same.  The addresses and facsimile numbers for such communications
shall be:

If to the Company:

EnterConnect Inc.
100 Century Center Court
Suite 650
San Jose, California 95112-4537
Telephone:     (408) 441-9500
Facsimile:       (408) 452-9040
Attention:      Sam Jankovich

- 30 -

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Copy to:

Andrew N. Bernstein, P.C.
5445 DTC Parkway, Suite 520
Greenwood Village, Colorado 80111
Facsimile No.:     (303) 770-7332
Telephone No.:  (303) 770-7131
Attn.: Andrew N. Bernstein, Esq.

If to the Transfer Agent:

Interwest Transfer Co., Inc.
1981 East 4800 South, Suite 100
PO Box 17136
Salt Lake City, UT 84117
Telephone:   801-272-9294
Facsimile:      801-277-3147
Attention:     Kurt Hughes

If to a Buyer, to its address and facsimile number set forth on the Schedule of
Buyers, with copies to such Buyer's representatives as set forth on the Schedule
of Buyers,

with a copy (for informational purposes only) to:

Schulte Roth & Zabel LLP
919 Third Avenue
New York, New York  10022
Telephone:       (212) 756-2000
Facsimile:          (212) 593-5955
Attention:         Eleazer N. Klein, Esq.

or to such other address and/or facsimile number and/or to the attention of such
other Person as the recipient party has specified by written notice given to
each other party five (5) days prior to the effectiveness of such
change.  Written confirmation of receipt (A) given by the recipient of such
notice, consent, waiver or other communication, (B) mechanically or
electronically generated by the sender's facsimile machine containing the time,
date, recipient facsimile number and an image of the first page of such
transmission or (C) provided by an overnight courier service shall be rebuttable
evidence of personal service, receipt by facsimile or receipt from an overnight
courier service in accordance with clause (i), (ii) or (iii) above,
respectively.

(g)           Successors and Assigns.  This Agreement shall be binding upon and
inure to the benefit of the parties and their respective successors and assigns,
including any purchasers of the Notes or the Warrants.  The Company shall not
assign this Agreement or any rights or obligations hereunder without the prior
written consent of the holders of at least a majority of the aggregate number of
Registrable Securities issued and issuable hereunder and under the Notes,
including by way of a Fundamental Transaction (unless the Company is in
compliance with the applicable provisions governing Fundamental Transactions set
forth in the Notes and the Warrants).  A Buyer may assign some or all of its
rights hereunder without the consent of the Company, in which event such
assignee shall be deemed to be a Buyer hereunder with respect to such assigned
rights

- 31 -

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(h)           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.

(i)           Survival.  Unless this Agreement is terminated under Section 8,
the representations and warranties of the Company and the Buyers contained in
Sections 2 and 3, and the agreements and covenants set forth in Sections 4, 5
and 9 shall survive the Closing and the delivery and exercise of Securities, as
applicable.  Each Buyer shall be responsible only for its own representations,
warranties, agreements and covenants hereunder.

(j)           Further Assurances.  Each party shall do and perform, or cause to
be done and performed, all such further acts and things, and shall execute and
deliver all such other agreements, certificates, instruments and documents, as
any other party may reasonably request in order to carry out the intent and
accomplish the purposes of this Agreement and the consummation of the
transactions contemplated hereby.

(k)           Indemnification.  In consideration of each Buyer's execution and
delivery of the Transaction Documents and acquiring the Securities thereunder
and in addition to all of the Company's other obligations under the Transaction
Documents, the Company shall defend, protect, indemnify and hold harmless each
Buyer and each other holder of the Securities and all of their stockholders,
partners, members, officers, directors, employees and direct or indirect
investors and any of the foregoing Persons' agents or other representatives
(including, without limitation, those retained in connection with the
transactions contemplated by this Agreement) (collectively, the "Indemnitees")
from and against any and all actions, causes of action, suits, claims, losses,
costs, penalties, fees, liabilities and damages, and expenses in connection
therewith (irrespective of whether any such Indemnitee is a party to the action
for which indemnification hereunder is sought), and including reasonable
attorneys' fees and disbursements (the "Indemnified Liabilities"), incurred by
any Indemnitee as a result of, or arising out of, or relating to (a) any
misrepresentation or breach of any representation or warranty made by the
Company in the Transaction Documents or any other certificate, instrument or
document contemplated hereby or thereby, (b) any breach of any covenant,
agreement or obligation of the Company contained in the Transaction Documents or
any other certificate, instrument or document contemplated hereby or thereby or
(c) any cause of action, suit or claim brought or made against such Indemnitee
by a third party (including for these purposes a derivative action brought on
behalf of the Company) and arising out of or resulting from (i) the execution,
delivery, performance or enforcement of the Transaction Documents or any other
certificate, instrument or document contemplated hereby or thereby, (ii) any
transaction financed or to be financed in whole or in part, directly or
indirectly, with the proceeds of the issuance of the Securities, (iii) any
disclosure made by such Buyer pursuant to Section 4(i), or (iv) the status of
such Buyer or holder of the Securities as an investor in the Company pursuant to
the transactions contemplated by the Transaction Documents.  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 Indemnified Liabilities that is permissible under applicable
law.  Except as otherwise set forth herein, the mechanics and procedures with
respect to the rights and obligations under this Section 9(k) shall be the same
as those set forth in Section 6 of the Registration Rights Agreement.

- 32 -

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(l)           No Strict Construction.  The language used in this Agreement will
be deemed to be the language chosen by the parties to express their mutual
intent, and no rules of strict construction will be applied against any party.

(m)           Remedies.  Each Buyer and each holder of the Securities shall have
all rights and remedies set forth in the Transaction Documents and all rights
and remedies which such holders have been granted at any time under any other
agreement or contract and all of the rights which such holders have under any
law.  Any Person having any rights under any provision of this Agreement shall
be entitled to enforce such rights specifically (without posting a bond or other
security), to recover damages by reason of any breach of any provision of this
Agreement and to exercise all other rights granted by law.  Furthermore, the
Company recognizes that in the event that it fails to perform, observe, or
discharge any or all of its obligations under the Transaction Documents, any
remedy at law may prove to be inadequate relief to the Buyers.  The Company
therefore agrees that the Buyers shall be entitled to seek temporary and
permanent injunctive relief in any such case without the necessity of proving
actual damages and without posting a bond or other security.

(n)           Rescission and Withdrawal Right.  Notwithstanding anything to the
contrary contained in (and without limiting any similar provisions of) the
Transaction Documents, whenever any Buyer exercises a right, election, demand or
option under a Transaction Document and the Company does not timely perform its
related obligations within the periods therein provided, then such Buyer may
rescind or withdraw, in its sole discretion from time to time upon written
notice to the Company, any relevant notice, demand or election in whole or in
part without prejudice to its future actions and rights.

(o)           Payment Set Aside.  To the extent that the Company makes a payment
or payments to the Buyers hereunder or pursuant to any of the other Transaction
Documents or the Buyers enforce or exercise their rights hereunder or
thereunder, and such payment or payments or the proceeds of such enforcement or
exercise or any part thereof are subsequently invalidated, declared to be
fraudulent or preferential, set aside, recovered from, disgorged by or are
required to be refunded, repaid or otherwise restored to the Company, a trustee,
receiver or any other Person under any law (including, without limitation, any
bankruptcy law, foreign, state or federal law, common law or equitable cause of
action), then to the extent of any such restoration the obligation or part
thereof originally intended to be satisfied shall be revived and continued in
full force and effect as if such payment had not been made or such enforcement
or setoff had not occurred.

- 33 -

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(p)           Independent Nature of Buyers' Obligations and Rights.  The
obligations of each Buyer under any Transaction Document are several and not
joint with the obligations of any other Buyer, and no Buyer shall be responsible
in any way for the performance of the obligations of any other Buyer under any
Transaction Document.  Nothing contained herein or in any other Transaction
Document, and no action taken by any Buyer pursuant hereto or thereto, shall be
deemed to constitute the Buyers as, and the Company acknowledges that the Buyers
do not so constitute, a partnership, an association, a joint venture or any
other kind of entity, or create a presumption that the Buyers are in any way
acting in concert or as a group, and the Company will not assert any such claim
with respect to such obligations or the transactions contemplated by the
Transaction Documents and the Company acknowledges that the Buyers are not
acting in concert or as a group with respect to such obligations or the
transactions contemplated by the Transaction Documents.  The Company
acknowledges and each Buyer confirms that it has independently participated in
the negotiation of the transaction contemplated hereby with the advice of its
own counsel and advisors.  Each Buyer shall be entitled to independently protect
and enforce its rights, including, without limitation, the rights arising out of
this Agreement or out of any other Transaction Documents, and it shall not be
necessary for any other Buyer to be joined as an additional party in any
proceeding for such purpose.

[Signature Page Follows]

- 34 -

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IN WITNESS WHEREOF, each Buyer and the Company have caused their respective
signature page to this Securities Purchase Agreement to be duly executed as of
the date first written above.

 
COMPANY:
           
ENTERCONNECT INC.
                   
By:
       
Name:  Sam Jankovich
     
Title:  Chairman & Chief Executive
     
Officer
 

--------------------------------------------------------------------------------

IN WITNESS WHEREOF, each Buyer and the Company have caused their respective
signature page to this Securities Purchase Agreement to be duly executed as of
the date first written above.

 
BUYERS:
           
HIGHBRIDGE INTERNATIONAL LLC
   
By: Highbridge Capital Management LLC
   
Its Trading Manager
                   
By:
       
Name:
     
Title:
 

--------------------------------------------------------------------------------

IN WITNESS WHEREOF, each Buyer and the Company have caused their respective
signature page to this Securities Purchase Agreement to be duly executed as of
the date first written above.

 
OTHER BUYERS:
           
ALAN JOHN MURRAY
                   
By:
       
Name:
     
Title:
 

--------------------------------------------------------------------------------

IN WITNESS WHEREOF, each Buyer and the Company have caused their respective
signature page to this Securities Purchase Agreement to be duly executed as of
the date first written above.

 
OTHER BUYERS:
           
ALAN YOSHIHARA SERIKAWA
                   
By:
       
Name:
     
Title:
 

--------------------------------------------------------------------------------

IN WITNESS WHEREOF, each Buyer and the Company have caused their respective
signature page to this Securities Purchase Agreement to be duly executed as of
the date first written above.

 
OTHER BUYERS:
           
BRIAN L, GROETSCH, SR.
                   
By:
       
Name:
     
Title:
 

--------------------------------------------------------------------------------

IN WITNESS WHEREOF, each Buyer and the Company have caused their respective
signature page to this Securities Purchase Agreement to be duly executed as of
the date first written above.

 
OTHER BUYERS:
           
VALERIE CHEESEMAN
                   
By:
       
Name:
     
Title:
 

--------------------------------------------------------------------------------

IN WITNESS WHEREOF, each Buyer and the Company have caused their respective
signature page to this Securities Purchase Agreement to be duly executed as of
the date first written above.

 
OTHER BUYERS:
           
CHRISTOPHER J. EIGEL
                   
By:
       
Name:
     
Title:
 

--------------------------------------------------------------------------------

IN WITNESS WHEREOF, each Buyer and the Company have caused their respective
signature page to this Securities Purchase Agreement to be duly executed as of
the date first written above.

 
OTHER BUYERS:
           
DAVID R. SPENCER
                   
By:
       
Name:
     
Title:
 

--------------------------------------------------------------------------------

IN WITNESS WHEREOF, each Buyer and the Company have caused their respective
signature page to this Securities Purchase Agreement to be duly executed as of
the date first written above.

 
OTHER BUYERS:
           
MADELINE GAYLE ADAMS
                   
By:
       
Name:
     
Title:
 

--------------------------------------------------------------------------------

IN WITNESS WHEREOF, each Buyer and the Company have caused their respective
signature page to this Securities Purchase Agreement to be duly executed as of
the date first written above.

 
OTHER BUYERS:
           
GRANT LAU
                   
By:
       
Name:
     
Title:
 

--------------------------------------------------------------------------------

IN WITNESS WHEREOF, each Buyer and the Company have caused their respective
signature page to this Securities Purchase Agreement to be duly executed as of
the date first written above.

 
OTHER BUYERS:
           
JIM RITSCH
                   
By:
       
Name:
     
Title:
 

--------------------------------------------------------------------------------

IN WITNESS WHEREOF, each Buyer and the Company have caused their respective
signature page to this Securities Purchase Agreement to be duly executed as of
the date first written above.

 
OTHER BUYERS:
           
LAWRENCE STONE MCGEE III, MD
                   
By:
       
Name:
     
Title:
 

--------------------------------------------------------------------------------

IN WITNESS WHEREOF, each Buyer and the Company have caused their respective
signature page to this Securities Purchase Agreement to be duly executed as of
the date first written above.

 
OTHER BUYERS:
           
MARC S. CAHN
                   
By:
       
Name:
     
Title:
 

--------------------------------------------------------------------------------

IN WITNESS WHEREOF, each Buyer and the Company have caused their respective
signature page to this Securities Purchase Agreement to be duly executed as of
the date first written above.

 
OTHER BUYERS:
           
MARIO CERNEKA
                   
By:
       
Name:
     
Title:
 

--------------------------------------------------------------------------------

IN WITNESS WHEREOF, each Buyer and the Company have caused their respective
signature page to this Securities Purchase Agreement to be duly executed as of
the date first written above.

 
OTHER BUYERS:
           
MACCOLLUM FAMILY TRUST
   
By: Maxwell S. MacCollum, as Trustee
                   
By:
       
Name:
     
Title:
 

--------------------------------------------------------------------------------

IN WITNESS WHEREOF, each Buyer and the Company have caused their respective
signature page to this Securities Purchase Agreement to be duly executed as of
the date first written above.

 
OTHER BUYERS:
           
NORMAN A. DUDZIAK
                   
By:
       
Name:
     
Title:
 

--------------------------------------------------------------------------------

IN WITNESS WHEREOF, each Buyer and the Company have caused their respective
signature page to this Securities Purchase Agreement to be duly executed as of
the date first written above.

 
OTHER BUYERS:
           
RALPH V. KAPLAN, MD
                   
By:
       
Name:
     
Title:
 

--------------------------------------------------------------------------------

IN WITNESS WHEREOF, each Buyer and the Company have caused their respective
signature page to this Securities Purchase Agreement to be duly executed as of
the date first written above.

 
OTHER BUYERS:
           
VERONNE J. CRAWFORD TRUST
   
By: Veronne J. Crawford, as Trustee
                   
By:
       
Name:
     
Title:
 

--------------------------------------------------------------------------------

IN WITNESS WHEREOF, each Buyer and the Company have caused their respective
signature page to this Securities Purchase Agreement to be duly executed as of
the date first written above.

 
OTHER BUYERS:
           
ALAN WALTER STIEHL
                   
By:
       
Name:
     
Title:
 

--------------------------------------------------------------------------------

IN WITNESS WHEREOF, each Buyer and the Company have caused their respective
signature page to this Securities Purchase Agreement to be duly executed as of
the date first written above.

 
OTHER BUYERS:
           
ALAN P. POWER
                   
By:
       
Name:
     
Title:
 

--------------------------------------------------------------------------------

IN WITNESS WHEREOF, each Buyer and the Company have caused their respective
signature page to this Securities Purchase Agreement to be duly executed as of
the date first written above.

 
OTHER BUYERS:
           
GEORGE KRAUSS
                   
By:
       
Name:
     
Title:
 

--------------------------------------------------------------------------------

IN WITNESS WHEREOF, each Buyer and the Company have caused their respective
signature page to this Securities Purchase Agreement to be duly executed as of
the date first written above.

 
OTHER BUYERS:
           
IROQUOIS MASTER FUND LTD.
                   
By:
       
Name:
     
Title:
 

--------------------------------------------------------------------------------

IN WITNESS WHEREOF, each Buyer and the Company have caused their respective
signature page to this Securities Purchase Agreement to be duly executed as of
the date first written above.

 
OTHER BUYERS:
           
CRANSHIRE CAPITAL, LP
                   
By:
       
Name:
     
Title:
 

--------------------------------------------------------------------------------

IN WITNESS WHEREOF, each Buyer and the Company have caused their respective
signature page to this Securities Purchase Agreement to be duly executed as of
the date first written above.

 
OTHER BUYERS:
           
PROFESSIONAL OFFSHORE OPPORTUNITY FUND, LTD.
   
By: Marc K. Swickle, as Manager
                   
By:
       
Name:
     
Title:
 

--------------------------------------------------------------------------------

SCHEDULE OF BUYERS

(1)
 
(2)
 
(3)
 
(4)
 
(5)
 
(6)
                     
Buyer
 
Address and Facsimile Number
 
Aggregate Principal Amount of Notes
 
Number of Warrant Shares
 
Purchase Price
 
Legal Representative's Address and Facsimile Number
                     
Highbridge International 
 
c/o Highbridge Capital
 
$2,500,000
 
4,166,667
 
2,500,000
 
Schulte Roth & Zabel LLP
LLC  
Management, LLC
             
919 Third Avenue
   
9 West 57th St, 27th Floor
             
New York, New York  10022
   
New York, NY 10019
             
Attention:  Eleazer Klein, Esq.
   
Attn: Ari J. Storch / Adam J. Chill
             
Facsimile: (212) 593-5955
   
Tel: 212-287-4720
             
Telephone:  (212) 756-2376
   
Fax: 212-751-0755
                   
Residence: Cayman Islands
                                                           
Professional Offshore
 
1400 Old Country Road, Suite 206
 
$1,000,000
 
1,666,667
 
$1,000,000
 
N/A
Opportunity Fund, Ltd.
 
Westbury, New York 11590
                                                           
Cranshire Capital, LP
 
3100 Dundee Rd., Suite 703
 
$250,000
 
416,667
 
$250,000
 
N/A
   
Northbrook, IL 60062
                                                           
Iroquois Master Fund Ltd.
 
641 Lexington Ave.
 
$250,000
 
416,667
 
$250,000
 
N/A
   
26th Floor
                   
New York, New York 10022
                                                           
Adams, Madeline Gayle
 
134 Canteen
 
$25,000
 
41,667
 
$25,000
 
N/A
   
Canyon Lake, TX 78133
                                                           
Cahn, Marc S.
 
1496 Tamarack Avenue
 
$25,000
 
41,667
 
$25,000
 
N/A
   
Boulder, CO 80304
                                                           
Cerneka, Mario
 
14432 Adelta Drive
 
$25,000
 
41,667
 
$25,000
 
N/A
   
Lamirada, CA 90638
               

 

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Cheeseman, Valerie
 
330 North 900 West #H
 
$23,000
 
38,333
 
$23,000
 
N/A
   
Cedar City, UT 84720
                                                           
Crawford, Veronne J.,
 
4800 Wildcat Run
 
$25,000
 
41,667
 
$25,000
 
N/A
Trustee
 
Springfield, IL 62711
                                                           
Dudziak, Norman A., Jr.
 
32 Washington Road
 
$50,000
 
83,333
 
$50,000
 
N/A
   
Berington, RI 02806
                                                           
Eigel, Christopher J.
 
595 Glendale Drive
 
$25,000
 
41,667
 
$25,000
 
N/A
   
Glenview, IL 60025
                                                           
Groetsch, Brian L., Sr.
 
Winter: 980 Greenwood Court
 
$50,000
 
83,333
 
$50,000
 
N/A
   
Sanibel, FL 33557
                                                           
Kaplan, Ralph V., M.D.
 
139 East Broadway
 
$25,000
 
41,667
 
$25,000
 
N/A
   
New York, NY 10002
                                                           
Krauss, George
 
1214 Howard #202
 
$250,000
 
416,667
 
$250,000
 
N/A
   
Omaha, NE 68102
                                                           
Lau, Grant
 
241 East Hooper Avenue
 
$25,000
 
41,667
 
$25,000
 
N/A
    Soda Springs, ID 83276                                                      
     
MacCollum, Maxwell S.
 
126 East Desert Park Lane
 
$25,000
 
41,667
 
$25,000
 
N/A
   
Phoenix, AZ 85020
                                                           
McGee, LawrenceStone III, MD
 
108 Pine Acres Drive
 
$62,500
 
104,167
 
$62,500
 
N/A
   
Spartanburg, SC 29307
                                                           
Murray, Alan John
 
3540 Riverbend Road
 
$25,000
 
41,667
 
$25,000
 
N/A
   
Birmingham, AL 35243
               

 

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Power, Alan
 
1314 Cabrillo Avenue
 
$25,000
 
41,667
 
$25,000
 
N/A
   
Venice, CA 90291
                                                           
Ritsch, James J.
 
2128 High Point Drive
 
$50,000
 
83,333
 
$50,000
 
N/A
   
Altoona, WI 54720
                                                           
Serikawa, Yoshihara
 
1470 Ala Napunani Street
 
$50,000
 
83,333
 
$50,000
 
N/A
   
Honolulu, HI 96818
                                                           
Spencer, David R.
 
3810 Grand Plantation Lane
 
$25,000
 
41,667
 
$25,000
 
N/A
   
Missouri City, TX 77459
                                                           
Stiehl, Walter A.
 
48 Puritan Road
 
$12,500
 
20,833
 
$12,500
 
N/A
   
Somerville, MA 02145
                                             
$4,823,000.00
 
8,038,337
 
$4,823,000.00
   

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EXHIBITS

Exhibit A
Form of Notes

Exhibit B
Form of Warrant

Exhibit C
Form of Registration Rights Agreement

Exhibit D
Form of Irrevocable Transfer Agent Instructions

Exhibit E
Form of Opinion of Company’s Counsel

Exhibit F
Form of Secretary's Certificate

Exhibit G
Form of Officers Certificate

Exhibit H
Form of Pledge and Security Agreement

Exhibit I
Form of Collateral Agency Agreement

Exhibit J
Form of Lock-Up Agreement

SCHEDULES

Schedule 3(g)
Placement Agent's Fees

Schedule 3(r)
Equity capitalization

 

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