SHARES FOR DEBT AGREEMENT

 

This SHARES FOR DEBT AGREEMENT (this "Agreement") is made and entered into as of
February 15, 2005, by and between MOTIVNATION, INC., a Nevada corporation (the
"Company"), and JAY ISCO, an individual whose address is
____________________________________ ("Isco"), with reference to the following
facts:

 

RECITALS

 

WHEREAS, Isco is the duly appointed and acting Interim CFO of the Company;

 

WHEREAS, for services rendered by Isco to the Company during the period from May
11, 2004 through December 31, 2004, the Company is indebted to Isco in amount of
U.S. $50,000 (the "Debt Amount"); and

 

WHEREAS, the Company has agreed to issue to Isco and Isco has agreed to accept
10,000,000 restricted shares of the Company's common stock as complete
settlement of the Debt Amount;

 

NOW THEREFORE, in consideration of the mutual covenants and promises contained
herein, and for valuable consideration, the receipt and sufficiency of which are
hereby mutually acknowledged, the parties to this Agreement (collectively
"parties" and individually a "party") agree as follows:

 

AGREEMENT

 

1. The Company agrees to issue to Isco and Isco agrees to accept, 10,000,000
restricted shares of the Company's common stock (the "Shares") as complete
payment and settlement of the Debt Amount and any and all other amounts due or
accrued to Isco for the compensation period from May 11, 2004 through December
31, 2004.

 

2. Upon issuance of the Shares, Isco hereby, for himself and his past and
present agents, executors, administrators, trustees, partners, representatives,
controlled entities and affiliates, successors and assigns, forever discharges
and releases the Company and each of its past and present employees, agents,
representatives, controlled entities and affiliates, successors and assigns from
any and all claims, damages, actions, judgments, obligations, attorneys' fees,
indemnities, subrogations, duties, demands, controversies and liabilities of
every nature at law or in equity, liquidated, or unliquidated, known or unknown,
matured or unmatured, foreseeable or unforeseeable, which Isco had or has
arising out of the Debt Amount.

 

3. This Agreement shall in all respects be interpreted, enforced and governed
under the laws of the State of California. The language and all parts of this
Agreement shall be in all cases construed as a whole according to its very
meaning and not strictly for or against any individual party.

 

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4. Solely for establishing that the issuance of the Shares to Isco is exempt
from the registration requirements of Section 5 of the Securities Act of 1933
(as amended, the "Securities Act") and comparable provisions of state blue-sky
laws, Isco represents and warrants to the Company as follows:

 

(a) Isco is an "Accredited Investor" as that term is defined in Rule 501 of
Regulation D promulgated under the Securities Act of 1933, as amended (the
"Securities Act").

 

(b) Isco understands that the Shares may not be sold, transferred or otherwise
disposed of without registration under the Securities Act or an exemption there
from.

 

(c) Isco understands and agrees that the certificate evidencing the Shares shall
be endorsed with the legend in substantially the form set forth below:

 

"THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED, AND MAY NOT BE SOLD, TRANSFERRED, ASSIGNED, PLEDGED OR
HYPOTHECATED UNLESS REGISTERED UNDER SUCH ACT, OR UNLESS THE COMPANY HAS
RECEIVED AN OPINION OF COUNSEL OR OTHER EVIDENCE SATISFACTORY TO THE COMPANY
THAT AN EXEMPTION THEREFROM IS AVAILABLE."

 

(d) In addition to the foregoing, Isco hereby makes all of the investment
representations set forth on Exhibit A attached hereto, which are incorporated
by reference herein.

 

5. This Agreement memorializes and constitutes the entire agreement and
understanding among the parties regarding the subject matter hereof, and
supersedes all prior negotiations, proposed agreements and agreements, whether
written or unwritten. The parties acknowledge that no other party, nor any agent
or attorney of any other party, has made any promises, representations, or
warranties whatsoever, expressly or impliedly, which are not expressly contained
in this Agreement, and the parties further acknowledge that they have not
executed this Agreement in reliance upon any collateral promise, representation,
warranty, or in reliance upon any belief as to any fact or matter not expressly
recited in this Agreement.

 

6. The parties shall hereafter execute all documents and do all that is
necessary, convenient or desirable in the reasonable opinion of the other party
to effect the provisions of this Agreement.

 

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7. For the convenience of the parties to this Agreement, this document may be
executed by facsimile signatures and in counterparts which shall together
constitute the agreement of the parties as one and the same instrument. It is
the intent of the parties that a copy of this Agreement signed by any party
shall be fully enforceable against that party.

 

8. Should any provision of this Agreement be declared or determined by any court
to be illegal or invalid, the validity of the remaining parts, terms or
provisions shall not be affected thereby and, in lieu of such illegal or invalid
provision, there shall be added a provision as similar in terms and amount to
such illegal or invalid provision as may be possible and, if such illegal or
invalid provision cannot be so modified, then it shall be deemed not to be a
part of this Agreement.

 

[SIGNATURES FOLLOW]

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IN WITNESS WHEREOF the parties have executed this Shares for Debt Agreement as
of the date first above written.

 

MOTIVNATION, INC.

 

By:                                                

George LeFevre

Its: CEO

 

                                                       

Jay Isco

 

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EXHIBIT A

 

INVESTMENT REPRESENTATION STATEMENT

 

In connection with the purchase of Shares, I, the undersigned, represent to the
Company as follows:

 

1. The Company May Rely on These Representations. I understand that the
Company's sale of the shares to me has not been registered under the Securities
Act of 1933, as amended, because the Company believes, relying in part on my
representations in this document, that an exemption from such registration
requirement is available for such sale. I understand that the availability of
this exemption depends upon the representations I am making to the Company in
this document being true and correct.

 

2. I am Purchasing for Investment. I am purchasing the shares solely for
investment purposes, and not for further distribution. My entire legal and
beneficial ownership interest in the shares is being purchased and shall be held
solely for my account, except to the extent I intend to hold the shares jointly
with my spouse. I am not a party to, and do not presently intend to enter into,
any contract or other arrangement with any other person or entity involving the
resale, transfer, grant of participation with respect to or other distribution
of any of the shares. My investment intent is not limited to my present
intention to hold the shares for the minimum capital gains period specified
under any applicable tax law, for a deferred sale, for a specified increase or
decrease in the market price of the shares, or for any other fixed period in the
future.

 

3. I Can Protect My Own Interests. I can properly evaluate the merits and risks
of an investment in the shares and can protect my own interests in this regard,
whether by reason of my own business and financial expertise, the business and
financial expertise of certain professional advisors unaffiliated with the
Company with whom I have consulted, or my preexisting business or personal
relationship with the Company or any of its officers, directors or controlling
persons.

 

4. I am Informed About the Company. I am sufficiently aware of the Company's
business affairs and financial condition to reach an informed and knowledgeable
decision to acquire the shares. I have had opportunity to discuss the plans,
operations and financial condition of the Company with its officers, directors
or controlling persons, and have received all information I deem appropriate for
assessing the risk of an investment in the shares.

 

5. I Recognize My Economic Risk. I realize that the purchase of the shares
involves a high degree of risk, and that the Company's future prospects are
uncertain. I am able to hold the shares indefinitely if required, and am able to
bear the loss of my entire investment in the shares.

 

6. I am Familiar With Rule 144. I am familiar with Rule 144 adopted under the
Securities Act, which in some circumstances permits limited public resales of
"restricted securities" like the shares acquired from an issuer in a non-public
offering. I understand that my ability to sell the shares under Rule 144 in the
future is uncertain, and will depend upon, among other things: (i) the
availability of certain current public information about the Company; (ii) the
resale occurring more than one year after my purchase and full payment (within
the meaning of Rule 144) for the shares; and (iii) if I am an affiliate of the
Company, or a non-affiliate who has held the shares less than two years after my
purchase and full payment:

 

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(A) the sale being made through a broker in an unsolicited "broker's
transaction" or in transactions directly with a market maker, as said term is
defined under the Securities Exchange Act of 1934, as amended, (B) the amount of
shares being sold during any three month period not exceeding the specified
limitations stated in Rule 144, and (C) timely filing of a notice of proposed
sale on Form 144, if applicable.

 

7. I Know Rule 144 May Never be Available. I understand that the requirements of
Rule 144 may never be met, and that the shares may never be saleable. I further
understand that at the time I wish to sell the shares, there may be no public
market for the Company's stock upon which to make such a sale, or the current
public information requirements of Rule 144 may not be satisfied, either of
which would preclude me from selling the shares under Rule 144 even if the
one-year minimum holding period had been satisfied.

 

8. I Know I am Subject to Further Restrictions on Resale. I understand that in
the event Rule 144 is not available to me, any future proposed sale of any of
the shares by me will not be possible without prior registration under the
Securities Act, compliance with some other registration exemption (which may or
may not be available), or each of the following:
(i) my written notice to the Company containing detailed information regarding
the proposed sale, (ii) my providing an opinion of my counsel to the effect that
such sale will not require registration, and (iii) the Company notifying me in
writing that its counsel concurs in such opinion. I understand that neither the
Company nor its counsel is obligated to provide me with any such opinion. I
understand that although Rule 144 is not exclusive, the Staff of the SEC has
stated that persons proposing to sell private placement securities other than in
a registered offering or pursuant to Rule 144 will have a substantial burden of
proof in establishing that an exemption from registration is available for such
offers or sales, and that such persons and their respective brokers who
participate in such transactions do so at their own risk.

 

9. I Know I May Have Tax Liability Due to the Uncertain Value of the Shares. I
understand that the Board of Directors believes its valuation of the shares
represents a fair appraisal of their worth, but that it remains possible that,
with the benefit of hindsight, the Internal Revenue Service may successfully
assert that the value of the shares on the date of my purchase is substantially
greater than the Board's appraisal. I understand that any additional value
ascribed to the shares by such an IRS determination may constitute ordinary
income to me as of the purchase date, and that any additional taxes and interest
due as a result will be my sole responsibility payable only by me, and that the
Company need not and will not reimburse me for that tax liability.

 

10. Agreement. By signing below, I acknowledge my agreement with each of the
statements contained in this Investment Representation Statement as of the date
first set forth above, and my intent for the Company to rely on such statements
in issuing the shares to me.

 

                                                                       

Jay Isco