Exhibit 10.10
 
SUBSCRIPTION AGREEMENT
 
 
THIS SUBSCRIPTION AGREEMENT (this “Agreement”), dated as of August 27, 2009 by
and among Greenchek Technology, Inc., a Nevada Corportaion (the “Company”), and
the subscriber identified on the signature page hereto (each a “Subscriber” and
collectively the “Subscriber”).
 
WHEREAS, the Company and the Subscribers are executing and delivering this
Agreement in reliance upon an exemption from securities registration afforded by
the provisions of Section 4(2), Section 4(6) and/or Regulation D (“Regulation
D”) as promulgated by the United States Securities and Exchange Commission (the
“Commission”) under the Securities Act of 1933, as amended (the “1933 Act”);
 
WHEREAS, the parties desire that, upon the terms and subject to the conditions
contained herein, the Company shall issue and sell to such Subscribers, as
provided herein, and such Subscribers, in the aggregate, shall purchase up to
(i) One Hundred Thousand Dollars ($100,000) (the “Purchase Price”) of principal
amount of convertible promissory notes of the Company (“Note” or “Notes”), a
form of which is annexed hereto as Exhibit A, which Notes are convertible into
shares of the Company’s common stock, $.00001 par value (the “Common Stock”), at
a fixed conversion price of $0.05 per share (the “Conversion Price”), as such
Conversion Price may be adjusted as provided for herein and in the Note, (ii)
shares of the Company’s Common Stock (“Purchased Shares”), and (iii) share
purchase warrants (the “Warrants”) in the form attached hereto as Exhibit B, to
purchase shares of the Company’s Common Stock (the “Warrant Shares”).  The
Notes, Purchased Shares, shares of Common Stock issuable upon conversion of the
Notes (the “Shares”), the Warrants and the shares issuable upon exercise of the
Warrants are collectively referred to herein as the “Securities.”; and
 
NOW, THEREFORE, in consideration of the mutual covenants and other agreements
contained in this Agreement, the Company and the Subscribers hereby agree as
follows:
 
1.           Closing Date.  The “Closing Date” shall be the date that the
Purchase Price is transmitted by wire transfer or otherwise credited to or for
the benefit of the Company. The consummation of the transactions contemplated
herein shall take place at the offices of Yosef Y. Manela 5455 Wilshire Blvd.
Suite 2123, Los Angeles, CA 90036, upon the satisfaction or waiver of all
conditions to closing set forth in this Agreement.   Subject to the satisfaction
or waiver of the terms and conditions of this Agreement, on the Closing Date,
each Subscriber shall purchase and the Company shall sell to each Subscriber a
Note in the principal amount designated on the signature page hereto and the
amount of Purchased Shares determined pursuant to Section 2 below for the
portion of the Purchase Price indicated, and Warrants as described in Section 3
of this Agreement.
 
2. Shares.  The Subscriber will receive three million commitment shares. These
shares will have Registration Rights.
 
3.           Warrants.   On the Closing Date, the Company will issue and deliver
9,000,000 Warrants to the Subscriber.  The number of Warrant Shares eligible for
purchase by the Subscriber is set forth in the signature page of this
Agreement.  The aggregate number of the warrants for purchase by the Subscriber
is 9,000,000, subject to adjustment as provided for herein and in the Warrants.
There shall be 3,000,000 Class A warrants, and 6,000,000 Class B warrants.  The
exercise Price to acquire a Class A warrant shall be $0.0001. The exercise price
to acquire a Warrant Share upon exercise of a Class B Warrant shall be $0.01.
The Warrants shall be exercisable until five (5) years after the issue date of
the Warrants. The Warrants will have a cashless feature. Each holder of the
Warrants is granted the registration rights set forth in this Agreement.  The
Warrant exercise price and number of Warrant Shares issuable upon exercise of
the Warrants shall be equitably adjusted to offset the effect of stock splits,
stock dividends, and similar events, and as otherwise described in the Warrant.
 
4.           Subscriber’s Representations and Warranties.  The Subscriber hereby
represents and warrants to and agrees with the Company only as to such
Subscriber that:
 
(a)           Organization and Standing of the Subscriber.  If such Subscriber
is an entity, such Subscriber is a corporation, partnership or other entity duly
incorporated or organized, validly existing and in good standing under the laws
of the jurisdiction of its incorporation or organization.
 
(b)           Authorization and Power.  Such Subscriber has the requisite power
and authority to enter into and perform this Agreement and the other Transaction
Documents and to purchase the Notes, Purchased Shares and Warrants being sold to
it hereunder.  The execution, delivery and performance of this Agreement and the
other Transaction Documents by such Subscriber and the consummation by it of the
transactions contemplated hereby and thereby have been duly authorized by all
necessary corporate or partnership action, and no further consent or
authorization of such Subscriber or its board of directors, stockholders,
partners, members, as the case may be, is required.  This Agreement and the
other Transaction Documents have been duly authorized, executed and delivered by
such Subscriber and constitutes, or shall constitute when executed and
delivered, a valid and binding obligation of such Subscriber enforceable against
such Subscriber in accordance with the terms thereof.
 
 
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(c)           No Conflicts.  The execution, delivery and performance of this
Agreement and the other Transaction Documents and the consummation by such
Subscriber of the transactions contemplated hereby and thereby or relating
hereto do not and will not (i) result in a violation of such Subscriber’s
charter documents or bylaws or other organizational documents 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 or obligation to which such Subscriber is a party or by which its
properties or assets are bound, or result in a violation of any law, rule, or
regulation, or any order, judgment or decree of any court or governmental agency
applicable to such Subscriber or its properties (except for such conflicts,
defaults and violations as would not, individually or in the aggregate, have a
material adverse effect on such Subscriber).  Such Subscriber is not required to
obtain any consent, authorization or order of, or make any filing or
registration with, any court or governmental agency in order for it to execute,
deliver or perform any of its obligations under this Agreement and the other
Transaction Documents  or to purchase the Securities in accordance with the
terms hereof, provided that for purposes of the representation made in this
sentence, such Subscriber is assuming and relying upon the accuracy of the
relevant representations and agreements of the Company herein.
 
(d)           Information on Company.  Such Subscriber has been furnished with
or has had access at the EDGAR Website of the Commission to the Company’s Form
10-KSB for the year ended December 31, 2007 as filed with the Commission,
together with all subsequently filed Forms 10-QSB, Forms 8-K, and other reports
and filings made with the Commission and made available at the EDGAR website
(hereinafter referred to collectively as the “Reports”).  Such Subscriber has
had an opportunity to ask questions and receive answers from representatives of
the Company.  In addition, such Subscriber has received in writing from the
Company such other information concerning its operations, financial condition
and other matters as such Subscriber has requested in writing identified thereon
as OTHER WRITTEN INFORMATION (such other information is collectively, the “Other
Written Information”), and considered all factors such Subscriber deems material
in deciding on the advisability of investing in the Securities.   The Subscriber
and its advisors, if any, have been afforded the opportunity to ask questions of
the Company and to receive answers thereto concerning the Company and the
transactions contemplated herein.  Subscriber does not acknowledge that any of
such information is material non-public information.
 
(e)           Information on Subscriber.  Concurrently herewith, Subscriber is
delivering to the Company a completed and executed Subscriber Questionnaire, the
form of which is attached hereto as Exhibit D.  Such Subscriber is, and will be
at the time of the conversion of the Notes and exercise of the Warrants, an
"accredited investor", as such term is defined in Regulation D promulgated by
the Commission under the 1933 Act, is experienced in investments and business
matters, has made investments of a speculative nature and has purchased
securities of United States publicly-owned companies in private placements in
the past and, with its representatives, has such knowledge and experience in
financial, tax and other business matters as to enable such Subscriber to
utilize the information made available by the Company to evaluate the merits and
risks of and to make an informed investment decision with respect to the
proposed purchase, which represents a speculative investment.  Such Subscriber
has the authority and is duly and legally qualified to purchase and own the
Securities.  Such Subscriber is able to bear the risk of such investment for an
indefinite period and to afford a complete loss thereof.  The information set
forth in the Subscriber Questionnaire and on the signature page hereto regarding
such Subscriber is accurate.
 
(f)           Purchase of Notes, Purchased Shares and Warrants.  On the Closing
Date, such Subscriber will purchase the Notes, Purchased Shares and Warrants as
principal for its own account for investment only and not with a view toward, or
for resale in connection with, the public sale or any distribution thereof.
 
(g)           Compliance with Securities Act.   Such Subscriber understands and
agrees that the Securities have not been registered under the 1933 Act or any
applicable state securities laws, by reason of their issuance in a transaction
that does not require registration under the 1933 Act (based in part on the
accuracy of the representations and warranties of such Subscriber contained
herein), and that such Securities must be held indefinitely unless a subsequent
disposition is registered under the 1933 Act or any applicable state securities
laws or is exempt from such registration.
 
(k)           Communication of Offer.   The offer to sell the Securities was
directly communicated to such Subscriber by the Company.  At no time was such
Subscriber presented with or solicited by any leaflet, newspaper or magazine
article, radio or television advertisement, or any other form of general
advertising or solicited or invited to attend a promotional meeting otherwise
than in connection and concurrently with such communicated offer.
 
 
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(l)           Restricted Securities.   Such Subscriber understands that the
Securities have not been registered under the 1933 Act and such Subscriber will
not sell, offer to sell, assign, pledge, hypothecate or otherwise transfer any
of the Securities unless pursuant to an effective registration statement under
the 1933 Act, or unless an exemption from registration is
available.  Notwithstanding anything to the contrary contained in this
Agreement, such Subscriber may transfer (without restriction and without the
need for an opinion of counsel) the Securities to its Affiliates (as defined
below) provided that each such Affiliate is an “accredited investor” under
Regulation D and such Affiliate agrees to be bound by the terms and conditions
of this Agreement. For the purposes of this Agreement, an “Affiliate” of any
person or entity means any other person or entity directly or indirectly
controlling, controlled by or under direct or indirect common control with such
person or entity.  Affiliate includes each Subsidiary of the Company.  For
purposes of this definition, “control” means the power to direct the management
and policies of such person or firm, directly or indirectly, whether through the
ownership of voting securities, by contract or otherwise.
 
(m)           No Governmental Review.  Such Subscriber understands that no
United States federal or state agency or any other governmental or state agency
has passed on or made recommendations or endorsement of the Securities or the
suitability of the investment in the Securities nor have such authorities passed
upon or endorsed the merits of the offering of the Securities.
 
(n)           Correctness of Representations.  Such Subscriber represents as to
such Subscriber that the foregoing representations and warranties are true and
correct as of the date hereof and, unless a Subscriber otherwise notifies the
Company prior to the Closing Date shall be true and correct as of the Closing
Date.
 
(o)           Survival.  The foregoing representations and warranties shall
survive the Closing Date.
 
5.           Company Representations and Warranties.  The Company represents and
warrants to and agrees with each Subscriber that:
 
(a)           Due Incorporation.  The Company and each of its Subsidiaries is a
corporation or other entity duly incorporated or organized, validly existing and
in good standing under the laws of the jurisdiction of its incorporation or
organization and has the requisite corporate power to own its properties and to
carry on its business as presently conducted.  The Company and each of its
Subsidiaries is duly qualified as a foreign corporation to do business and is in
good standing in each jurisdiction where the nature of the business conducted or
property owned by it makes such qualification necessary, other than those
jurisdictions in which the failure to so qualify would not have a Material
Adverse Effect (as defined below) on the Company.  For purposes of this
Agreement, a “Material Adverse Effect” on the Company shall mean a material
adverse effect on the financial condition, results of operations, properties or
business of the Company and its Subsidiaries taken as a whole.  For purposes of
this Agreement, “Subsidiary” means, with respect to any entity at any date, any
corporation, limited or general partnership, limited liability company, trust,
estate, association, joint venture or other business entity of which more than
25% of (i) the outstanding capital stock having (in the absence of
contingencies) ordinary voting power to elect a majority of the board of
directors or other managing body of such entity, (ii) in the case of a
partnership or limited liability company, the interest in the capital or profits
of such partnership or limited liability company or (iii) in the case of a
trust, estate, association, joint venture or other entity, the beneficial
interest in such trust, estate, association or other entity business is, at the
time of determination, owned or controlled directly or indirectly through one or
more intermediaries, by such entity.  All the Company’s Subsidiaries as of the
Closing Date and the Company’s ownership interest in such Subsidiaries are set
forth on Schedule 5(a) hereto.
 
(b)           Outstanding Stock.  All issued and outstanding shares of capital
stock of the Company have been duly authorized and validly issued and are fully
paid and nonassessable.
 
(c)           Authority; Enforceability.  This Agreement, the Note, Purchased
Shares, the Warrants, Security Agreement, Subsidiary Guaranty, Collateral Agent
Agreement and the Escrow Agreement, and any other agreements delivered together
with this Agreement or in connection herewith (collectively, the “Transaction
Documents”) have been duly authorized, executed and delivered by the Company
and/or its Subsidiaries and are valid and binding agreements of the Company and
its Subsidiaries enforceable against them in accordance with their terms,
subject to bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium and similar laws of general applicability relating to or affecting
creditors’ rights generally and to general principles of equity.  The Company
has full corporate power and authority necessary to enter into and deliver the
Transaction Documents and to perform its obligations thereunder.
 
(d)           Additional Issuances.  There are no outstanding agreements or
preemptive or similar rights affecting the Company’s Common Stock or equity and
no outstanding rights, warrants or options to acquire, or instruments
convertible into or exchangeable for, or agreements or understandings with
respect to the sale or issuance of any shares of common stock or equity of the
Company or its Subsidiaries or other equity interest in the Company except as
described on Schedule 5(d).  The Common Stock of the Company on a fully diluted
basis outstanding as of the last Business Day preceding the Closing Date is set
forth on Schedule 5(d).
 
 
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(e)           Consents.  No consent, approval, authorization or order of any
court, governmental agency or body or arbitrator having jurisdiction over the
Company, or any of its Affiliates, the OTC Bulletin Board (the “Bulletin Board”)
nor the Company’s shareholders is required for the execution by the Company of
the Transaction Documents and compliance and performance by the Company of its
obligations under the Transaction Documents, including, without limitation, the
issuance and sale of the Securities.  The Transaction Documents and the
Company’s performance of its obligations thereunder has been unanimously
approved by the Company’s Board of Directors.
 
(f)           No Violation or Conflict.  Assuming the representations and
warranties of such Subscribers in Section 4 are true and correct and except as
set forth on this Schedule 5(f), neither the issuance and sale of the Securities
nor the performance by the Company of its obligations under this Agreement and
all other Transaction Documents entered into by the Company relating thereto by
the Company will:
 
(i)           violate, conflict with, result in a breach of, or constitute a
default (or an event which with the giving of notice or the lapse of time or
both would be reasonably likely to constitute a default) under (A) the articles
or certificate of incorporation, charter or bylaws of the Company, (B) to the
Company’s knowledge, any decree, judgment, order, law, treaty, rule, regulation
or determination applicable to the Company of any court, governmental agency or
body, or arbitrator having jurisdiction over the Company or over the properties
or assets of the Company or any of its Affiliates, (C) the terms of any bond,
debenture, note or any other evidence of indebtedness, or any agreement, stock
option or other similar plan, indenture, lease, mortgage, deed of trust or other
instrument to which the Company or any of its Affiliates is a party, by which
the Company or any of its Affiliates is bound, or to which any of the properties
of the Company or any of its Affiliates is subject, or (D) the terms of any
“lock-up” or similar provision of any underwriting or similar agreement to which
the Company, or any of its Affiliates is a party except the violation, conflict,
breach, or default of which would not have a Material Adverse Effect; or
 
(ii)           result in the creation or imposition of any lien, charge or
encumbrance upon the Securities or any of the assets of the Company or any of
its Affiliates except as described herein; or
 
(iii)           except as described in Schedule 5(d), result in the activation
of any anti-dilution rights or a reset or repricing of any debt, security or
other instrument of any creditor or equity holder of the Company, nor result in
the acceleration of the due date of any obligation of the Company; or
 
(iv)           will result in the triggering of any piggy-back registration
rights of any person or entity holding securities of the Company or having the
right to receive securities of the Company except as described in Schedule 5(f).
 
(g)           The Securities.  The Securities upon issuance, conversion and
exercise:
 
(i)           are, or will be, free and clear of any security interests, liens,
claims or other encumbrances, subject to restrictions upon transfer under the
1933 Act and any applicable state securities laws;
 
(ii)           have been, or will be, duly and validly authorized and on the
date of issuance of the Purchased Shares and Shares upon conversion of the Notes
and the Warrant Shares and upon exercise of the Warrants, the Shares and Warrant
Shares will be duly and validly issued, fully paid and nonassessable and if
registered pursuant to the 1933 Act and resold pursuant to an effective
registration statement will be free trading and unrestricted;
 
(iii)           will not have been issued or sold in violation of any preemptive
or other similar rights of the holders of any securities of the Company;
 
(iv)           will not subject the holders thereof to personal liability by
reason of being such holders; and
 
(v)           assuming the representations and warranties of such Subscribers as
set forth in Section 4 hereof are true and correct, will not result in a
violation of Section 5 under the 1933 Act.
 
(h)           Litigation.  There is no pending or, to the best knowledge of the
Company, threatened action, suit, proceeding or investigation before any court,
governmental agency or body, or arbitrator having jurisdiction over the Company,
or any of its Affiliates that would affect the execution by the Company or the
performance by the Company of its obligations under the Transaction
Documents.  Except as disclosed in the Reports or in the schedules hereto, there
is no pending or, to the best knowledge of the Company, basis for or threatened
action, suit, proceeding or investigation before any court, governmental agency
or body, or arbitrator having jurisdiction over the Company, or any of its
Affiliates which litigation if adversely determined would have a Material
Adverse Effect.
 
 
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(i)           Reporting Company.  The Company is a publicly-held company subject
to reporting obligations pursuant to Section 13 of the Securities Exchange Act
of 1934, as amended (“1934 Act”) and has a class of common stock registered
pursuant to Section 12(g) of the 1934 Act.  Pursuant to the provisions of the
1934 Act, the Company has timely filed all reports and other materials required
to be filed thereunder with the Commission during the preceding twelve months.
 
(j)           No Market Manipulation.  The Company and its Affiliates have not
taken, and will not take, directly or indirectly, any action designed to, or
that might reasonably be expected to, cause or result in stabilization or
manipulation of the price of the Common Stock to facilitate the sale or resale
of the Securities or affect the price at which the Securities may be issued or
resold.
 
(k)           Information Concerning Company.  The Reports and Other Written
Information contain all material information relating to the Company and its
operations and financial condition as of their respective dates which
information is required to be disclosed therein.   Since December 31, 2007, and
except as modified in the Other Written Information or in the Schedules hereto,
there has been no Material Adverse Event relating to the Company’s business,
financial condition or affairs not disclosed in the Reports. The Reports
including the financial statements therein, and Other Written Information do not
contain any untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein, taken
as a whole, not misleading in light of the circumstances when made.
 
(l)           Stop Transfer.  The Company has not and will not issue any stop
transfer order or other order impeding the sale, resale or delivery of any of
the Securities, except as may be required by any applicable federal or state
securities laws and unless contemporaneous notice of such instruction is given
to the Subscribers.
 
(m)           Defaults.  The Company is not in violation of its articles of
incorporation or bylaws.  The Company is (i) not in default under or in
violation of any other material agreement or instrument to which it is a party
or by which it or any of its properties are bound or affected, which default or
violation would have a Material Adverse Effect, (ii) not in default with respect
to any order of any court, arbitrator or governmental body or subject to or
party to any order of any court or governmental authority arising out of any
action, suit or proceeding under any statute or other law respecting antitrust,
monopoly, restraint of trade, unfair competition or similar matters, and (iii)
not in violation of any statute, rule or regulation of any governmental
authority which violation would have a Material Adverse Effect.
 
(n)           Not an Integrated Offering.  Neither the Company, nor any of its
Affiliates, nor any person acting on its or their behalf, has directly or
indirectly made any offers or sales of any security or solicited any offers to
buy any security under circumstances that would cause the offer of the
Securities pursuant to this Agreement to be integrated with prior offerings by
the Company for purposes of the 1933 Act or any applicable stockholder approval
provisions, including, without limitation, under the rules and regulations of
the Bulletin Board which would impair the exemptions relied upon in this
Offering or the Company’s ability to timely comply with its obligations
hereunder.  Neither the Company nor any of its Subsidiaries will take any action
or steps that would cause the offer or issuance of the Securities to be
integrated with other offerings which would impair the exemptions relied upon in
this Offering or the Company’s ability to timely comply with its obligations
hereunder.  The Company will not conduct any offering other than the
transactions contemplated hereby that will be integrated with the offer or
issuance of the Securities, which would impair the exemptions relied upon in
this Offering or the Company’s ability to timely comply with its obligations
hereunder.
 
(o)           No General Solicitation.  Neither the Company, nor any of its
Affiliates, nor to its knowledge, any person acting on its or their behalf, has
engaged in any form of general solicitation or general advertising (within the
meaning of Regulation D under the 1933 Act) in connection with the offer or sale
of the Securities.
 
(p)           Listing.  The Common Stock is quoted on the Bulletin Board under
the symbol GCHK.OB. The Company has not received any oral or written notice that
the Common Stock is not eligible nor will become ineligible for quotation on the
Bulletin Board nor that the Common Stock does not meet all requirements for the
continuation of such quotation and the Company satisfies all the requirements
for the continued quotation of the Common Stock on the Bulletin Board.
 
(q)           No Undisclosed Liabilities.  The Company has no liabilities or
obligations which are material, individually or in the aggregate, which are not
disclosed in the Reports and Other Written Information, other than those
incurred in the ordinary course of the Company’s businesses since December 31,
2007 and which, individually or in the aggregate, would reasonably be expected
not to have a Material Adverse Effect, except as disclosed on Schedule 5(q).
 
 
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(r)           No Undisclosed Events or Circumstances.  Since December 31, 2007,
no event or circumstance has occurred or exists with respect to the Company or
its businesses, properties, operations or financial condition, that, under
applicable law, rule or regulation, requires public disclosure or announcement
prior to the date hereof by the Company but which has been so publicly announced
or disclosed in the Reports.
 
(s)   Capitalization.  The authorized and the issued and outstanding capital
stock of the Company as of the date of this Agreement and the Closing Date (not
including the Securities) are set forth on Schedule 5(d).  Except as set forth
on Schedule 5(d), there are no options, warrants, or rights to subscribe to,
securities, rights or obligations convertible into or exchangeable for or giving
any right to subscribe for any shares of capital stock of the Company or any of
its Subsidiaries.
 
(t)   Dilution.  The Company’s executive officers and directors understand the
nature of the Securities being sold hereby and recognize that the issuance of
the Securities will have a potential dilutive effect on the equity holdings of
other holders of the Company’s equity or rights to receive equity of the
Company.  The board of directors of the Company has concluded, in its good faith
business judgment that the issuance of the Securities is in the best interests
of the Company and its shareholders.  The Company specifically acknowledges that
its obligation to issue the Purchased Shares, Shares upon conversion of the
Notes, and the Warrant Shares upon exercise of the Warrants is binding upon the
Company and enforceable regardless of the dilution such issuance may have on the
ownership interests of other stockholders of the Company or parties entitled to
receive equity of the Company.
 
(u)   No Disagreements with Accountants and Lawyers.  There are no disagreements
of any kind presently existing, or reasonably anticipated by the Company to
arise, between the Company and the accountants and lawyers formerly or presently
employed by the Company, including but not limited to disputes or conflicts over
payment owed to such accountants and lawyers, nor have there been any such
disagreements during the two (2) years prior to the Closing Date.
 
(v)           DTC Status.  The Company’s transfer agent is a participant in and
the Common Stock is eligible for transfer pursuant to the Depository Trust
Company Automated Securities Transfer Program.  The name, address, telephone
number, fax number, contact person and email address of the Company transfer
agent is set forth on Schedule 5(v) hereto.
 
(w)           Investment Company.  Neither the Company nor any Affiliate is an
“investment company” within the meaning of the Investment Company Act of 1940,
as amended.
 
(x)           Foreign Corrupt Practices.  Neither the Company, nor to the
knowledge of the Company, any agent or other person acting on behalf of the
Company, has (i) directly or indirectly, used any funds for unlawful
contributions, gifts, entertainment or other unlawful expenses related to
foreign or domestic political activity, (ii) made any unlawful payment to
foreign or domestic government officials or employees or to any foreign or
domestic political parties or campaigns from corporate funds, (iii) failed to
disclose fully any contribution made by the Company (or made by any person
acting on its behalf of which the Company is aware) which is  in violation of
law, or (iv) violated in any material respect any provision of the Foreign
Corrupt Practices Act of 1977, as amended.
 
(y)           Solvency.  Based on the financial condition of the Company as of
the Closing Date after giving effect to the receipt by the Company of the
proceeds from the sale of the Notes hereunder, (i) the Company’s fair saleable
value of its assets exceeds the amount that will be required to be paid on or in
respect of the Company’s existing debts and other liabilities (including known
contingent liabilities) as they mature; (ii) the Company’s assets do not
constitute unreasonably small capital to carry on its business for the current
fiscal year as now conducted and as proposed to be conducted including its
capital needs taking into account the particular capital requirements of the
business conducted by the Company, and projected capital requirements and
capital availability thereof; and (iii) the current cash flow of the Company,
together with the proceeds the Company would receive, were it to liquidate all
of its assets, after taking into account all anticipated uses of the cash, would
be sufficient to pay all amounts on or in respect of its debt when such amounts
are required to be paid.  The Company does not intend to incur debts beyond its
ability to pay such debts as they mature (taking into account the timing and
amounts of cash to be payable on or in respect of its debt).
 
(z)           Company Predecessor and Subsidiary Representations.  The Company
makes each of the representations contained in Sections 5(a), (b), (d), (f),
(h), (k), (m), (q), (r), (s), (u), (w), (x) and (y) of this Agreement, as same
relate to each Subsidiary of the Company.  All representations made by or
relating to the Company of a historical or prospective nature and all
undertakings described in Sections 9(g) through 9(l) shall relate, apply and
refer to the Company and its predecessors.  The Company represents that it owns
the equity of the Subsidiaries and rights to receive equity of the Subsidiaries
as set forth on Schedule 5(a), free and clear of all liens, encumbrances and
claims, except as set forth on Schedule 5(d).  No person or entity other than
the Company has the right to receive any equity interest in the Subsidiaries.
 
 
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(AA)           Correctness of Representations.  The Company represents that the
foregoing representations and warranties are true and correct as of the date
hereof in all material respects, and unless the Company otherwise notifies the
Subscribers prior to the Closing Date, shall be true and correct in all material
respects as of the Closing Date; provided, that, if such representation or
warranty is made as of a different date in which case such representation or
warranty shall be true as of such date.
 
(BB)           Survival.  The foregoing representations and warranties shall
survive the Closing Date.
 
6.           Regulation D Offering/Legal Opinion.  The offer and issuance of the
Securities to the Subscribers is being made pursuant to the exemption from the
registration provisions of the 1933 Act afforded by Section 4(2) or Section 4(6)
of the 1933 Act and/or Rule 506 of Regulation D promulgated thereunder.  On the
Closing Date, the Company will provide an opinion reasonably acceptable to such
Subscribers from the Company’s legal counsel in the form annexed hereto as
Exhibit E opining on the availability of an exemption from registration under
the 1933 Act as it relates to the offer and issuance of the Securities and other
matters reasonably requested by the Subscribers.  The Company will provide, at
the Company’s expense, such other legal opinions in the future as are reasonably
necessary for the issuance and resale of the Purchased Shares, Common Stock
issuable upon conversion of the Notes pursuant to an effective registration
statement, Rule 144 under the 1933 Act or an exemption from registration.
 
7.1         Conversion of Note.
 
(a)           Upon the conversion of a Note or part thereof, the Company shall,
at its own cost and expense, take all necessary action, including obtaining and
delivering, an opinion of counsel to assure that the Company’s transfer agent
shall issue stock certificates in the name of a Subscriber (or its permitted
nominee) or such other persons as designated by such Subscriber and in such
denominations to be specified at conversion representing the number of shares of
Common Stock issuable upon such conversion.  The Company warrants that no
instructions other than these instructions have been or will be given to the
transfer agent of the Company’s Common Stock and that the certificates
representing such shares shall contain no legend other than the legend set forth
in Section 4(h).  If and when a Subscriber sells the Shares, assuming (i) a
registration statement including such Shares is effective and the prospectus, as
supplemented or amended, contained therein is current and (ii) such Subscriber
or its agent confirms in writing to the transfer agent that such Subscriber has
complied with the prospectus delivery requirements, the Company will reissue the
Shares without restrictive legend and the Shares will be free-trading, and
freely transferable.  In the event that the Shares are sold in a manner that
complies with an exemption from registration, the Company will promptly instruct
its counsel to issue to the transfer agent an opinion permitting removal of the
legend (indefinitely, if pursuant to Rule 144(b)(1)(i) of the 1933 Act, or for
90 days if pursuant to other provisions of Rule 144 of the 1933 Act, provided
Subscriber delivers a reasonably requested representation in support of such
opinion).
 
(b)           A Subscriber will give notice of its decision to exercise its
right to convert the Note, interest or part thereof by telecopying or otherwise
delivering a completed Notice of Conversion (a form of which is annexed as
Exhibit A to the Note) to the Company via confirmed telecopier transmission or
otherwise pursuant to Section 13(a) of this Agreement.  Such Subscriber will not
be required to surrender the Note until the Note has been fully converted or
satisfied.  Each date on which a Notice of Conversion is telecopied to the
Company in accordance with the provisions hereof by 6:00 PM Eastern Time (ET)
(or if received by the Company after 6:00 PM ET, then the next business day)
shall be deemed a “Conversion Date”.  The Company will itself or cause the
Company’s transfer agent to transmit the Company’s Common Stock certificates
representing the Shares issuable upon conversion of the Note to such Subscriber
via express courier for receipt by such Subscriber within three (3) business
days after receipt by the Company of the Notice of Conversion (such third day
being the “Delivery Date”).  In the event the Shares are electronically
transferable, then delivery of the Shares must be made by electronic transfer
provided request for such electronic transfer has been made by such
Subscriber.   A Note representing the balance of the Note not so converted will
be provided by the Company to a Subscriber if requested by such Subscriber,
provided such Subscriber delivers the original Note to the Company. In the event
that a Subscriber elects not to surrender a Note for reissuance upon partial
payment or conversion of a Note, such Subscriber hereby indemnifies the Company
against any and all loss or damage attributable to a third-party claim in an
amount in excess of the actual amount then due under the Note.
 
(c)           The Company understands that a delay in the delivery of the Shares
in the form required pursuant to Section 7.1 hereof, or the Mandatory Redemption
Amount described in Section 7.2 hereof, respectively later than the Delivery
Date or the Mandatory Redemption Payment Date (as hereinafter defined) could
result in economic loss to a Subscriber.  As compensation to a Subscriber for
such loss, the Company agrees to pay (as liquidated damages and not as a
penalty) to such Subscriber for late issuance of Shares in the form required
pursuant to Section 7.1 hereof upon Conversion of the Note in the amount of $100
per business day after the Delivery Date for each $10,000 of Note principal
amount (and proportionately for other amounts) being converted of the
corresponding Shares which are not timely delivered.  The Company shall pay any
payments incurred under this Section in immediately available funds upon
demand.  Furthermore, in addition to any other
 
 
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remedies which may be available to such Subscriber, in the event that the
Company fails for any reason to effect delivery of the Shares within 7 business
days after the Delivery Date or make payment within 7 business days after the
Mandatory Redemption Payment Date (as defined in Section 7.2 below), such
Subscriber will be entitled to revoke all or part of the relevant Notice of
Conversion or rescind all or part of the notice of Mandatory Redemption by
delivery of a notice to such effect to the Company whereupon the Company and
such Subscriber shall each be restored to their respective positions immediately
prior to the delivery of such notice, except that the liquidated damages
described above shall be payable through the date notice of revocation or
rescission is given to the Company.
 
(d)           The Company agrees and acknowledges that despite the pendency of a
not yet effective registration statement which includes for registration the
Securities, the Subscriber is permitted to and the Company will issue to the
Subscriber Shares upon conversion of the Note and Warrant Shares upon exercise
of the Warrants.  Such Shares will, if required by law, bear the legends
described in Section 4 above and if the requirements of Rule 144 under the 1933
Act are satisfied be immediately resalable thereunder.
 
7.2         Mandatory Redemption at Subscriber’s Election.  In the event (a) the
Company is prohibited from issuing Shares, (b) fails to timely deliver Shares on
a Delivery Date, (c) upon the occurrence of any other Event of Default (as
defined in the Note or in this Agreement) and if any event listed in
subparagraph (a), (b) or (c) is not cured during any applicable cure period and
an additional twenty (20) days thereafter, or (d) upon a Change in Control (as
defined below), then at such Subscriber’s election, the Company must pay to such
Subscriber ten (10) business days after request by such Subscriber, at such
Subscriber’s election, a sum of money determined by (i) multiplying up to the
outstanding principal amount of the Note designated by such Subscriber by 120%,
or (ii) multiplying the number of Shares otherwise deliverable upon conversion
of an amount of Note principal and/or interest designated by such Subscriber
(with the date of giving of such designation being a “Deemed Conversion Date”)
by either the Conversion Price that would be in effect on the Deemed Conversion
Date or by the highest closing price of the Common Stock on the Principal Market
for the period commencing on the Deemed Conversion Date until the day prior to
the receipt of the Mandatory Redemption Payment, whichever is greater; together
with accrued but unpaid interest thereon and any other sums arising and
outstanding under the Transaction Documents (“Mandatory Redemption Payment”).
The Mandatory Redemption Payment must be received by such Subscriber within ten
(10) business days after request (“Mandatory Redemption Payment Date”). Upon
receipt of the Mandatory Redemption Payment, the corresponding Note principal
and interest will be deemed paid and no longer outstanding.  “Change in Control”
shall mean (i) the Company no longer having a class of shares publicly traded or
listed on a Principal Market (as hereinafter defined), (ii) the Company becoming
a Subsidiary of another entity or merging into or with another entity, (iii) a
majority of the board of directors of the Company as of the Closing Date no
longer serving as directors of the Company, except due to natural causes, or
(iv) the sale, lease, license or transfer of substantially all the assets of the
Company and its Subsidiaries.
 
7.3         Injunction Posting of Bond.  In the event a Subscriber shall elect
to convert a Note or part thereof, the Company may not refuse conversion or
exercise based on any claim that such Subscriber or any one associated or
affiliated with such Subscriber has been engaged in any violation of law, or for
any other reason, unless, an injunction from a court, on notice, restraining and
or enjoining conversion of all or part of such Note shall have been sought and
obtained by the Company or at the Company’s request or with the Company’s
assistance, and the Company has posted a surety bond for the benefit of such
Subscriber in the amount of 120% of the outstanding principal and interest of
the Note, or aggregate purchase price of the Shares which are sought to be
subject to the injunction, which bond shall remain in effect until the
completion of arbitration/litigation of the dispute and the proceeds of which
shall be payable to such Subscriber to the extent Subscriber obtains judgment in
Subscriber’s favor.
 
7.4         Buy-In.  In addition to any other rights available to a Subscriber,
if the Company fails to deliver to such Subscriber such shares issuable upon
conversion of a Note by the Delivery Date and if after seven (7) business days
after the Delivery Date such Subscriber or a broker on such Subscriber’s behalf,
purchases (in an open market transaction or otherwise) shares of Common Stock to
deliver in satisfaction of a sale by such Subscriber of the Common Stock which
such Subscriber was entitled to receive upon such conversion (a “Buy-In”), then
the Company shall pay in cash to such Subscriber (in addition to any remedies
available to or elected by such Subscriber) the amount by which (A) such
Subscriber’s total purchase price (including brokerage commissions, if any) for
the shares of Common Stock so purchased exceeds (B) the aggregate principal
and/or interest amount of the Note for which such conversion was not timely
honored, together with interest thereon at a rate of 15% per annum, accruing
until such amount and any accrued interest thereon is paid in full (which amount
shall be paid as liquidated damages and not as a penalty).  For example, if such
Subscriber purchases shares of Common Stock having a total purchase price of
$11,000 to cover a Buy-In with respect to an attempted conversion of $10,000 of
note principal and/or interest, the Company shall be required to pay  to such
Subscriber $1,000, plus interest. The Subscriber shall provide the Company
written notice indicating the amounts payable to such Subscriber in respect of
the Buy-In.
 
 
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7.5         Adjustments.  The Conversion Price, Warrant exercise price and the
number of Shares issuable upon conversion of the Notes and Warrant Shares
issuable upon exercise of the Warrants shall be equitably adjusted and as
otherwise described in this Agreement, the Notes and Warrants.
 
7.6         Redemption.  The Note shall be redeemed with the first draw downs of
the Equity Line Stock Purchase Agreement and with any new funds that come into
the Company, if the Company elects not to use The Equity Line.
 
8.           Finder/Legal Fees.
 
(a)           Finder.  The Company on the one hand, and each Subscriber (for
himself, herself or itself only) on the other hand, agrees to indemnify the
other against and hold the other harmless from any and all liabilities to any
persons claiming brokerage commissions or finder’s fees on account of services
purported to have been rendered on behalf of the indemnifying party in
connection with this Agreement or the transactions contemplated hereby and
arising out of such party’s actions.  The Company and each Subscriber represents
that there are no parties entitled to receive fees, commissions, or similar
payments in connection with the Offering (as such term is defined below) arising
out of such party’s actions.
 
(b)           Legal Fees.  The Company shall pay out of escrow a cash fee of
$25,000 which will include all legal fees associated with both transactions. The
fees will come out of escrow from the Bridge Loan funds.
 
9.           Covenants of the Company.  The Company covenants and agrees with
the Subscribers as follows:
 
(a)           Stop Orders.  The Company will advise the Subscribers, within
twenty-four hours after it receives notice of issuance by the Commission, any
state securities commission or any other regulatory authority of any stop order
or of any order preventing or suspending any offering of any securities of the
Company, or of the suspension of the qualification of the Common Stock of the
Company for offering or sale in any jurisdiction, or the initiation of any
proceeding for any such purpose.  The Company will not issue any stop transfer
order or other order impeding the sale, resale or delivery of any of the
Securities, except as may be required by any applicable federal or state
securities laws and unless contemporaneous notice of such instruction is given
to the Subscriber.
 
(b)           Listing/Quotation.  The Company shall promptly secure the
quotation or listing of the Purchased Shares, Shares and Warrant Shares upon the
Principal Market each national securities exchange, or automated quotation
system upon which they are or become eligible for quotation or listing (subject
to official notice of issuance) and shall maintain same so long as any Warrants
are outstanding.  The Company will maintain the quotation or listing of its
Common Stock on the American Stock Exchange, Nasdaq Capital Market, Nasdaq
Global Select Market, Nasdaq Global Market, the Bulletin Board, or New York
Stock Exchange (whichever of the foregoing is at the time the principal trading
exchange or market for the Common Stock (the “Principal Market”)), and will
comply in all respects with the Company’s reporting, filing and other
obligations under the bylaws or rules of the Principal Market, as applicable.
The Company will provide the Subscribers copies of all notices it receives
notifying the Company of the threatened and actual delisting of the Common Stock
from any Principal Market.  As of the date of this Agreement and the Closing
Date, the Bulletin Board is and will be the Principal Market.
 
(c)           Market Regulations.  The Company shall notify the Commission, the
Principal Market and applicable state authorities, in accordance with their
requirements, of the transactions contemplated by this Agreement, and shall take
all other necessary action and proceedings as may be required and permitted by
applicable law, rule and regulation, for the legal and valid issuance of the
Securities to the Subscribers and promptly provide copies thereof to the
Subscribers.
 
(d)           Filing Requirements.  From the date of this Agreement and until
the last to occur of (i) two (2) years after the Closing Date, (ii) until all
the Shares have been resold or transferred by all the Subscribers pursuant to a
registration statement or pursuant to Rule 144(b)(1)(i), or (iii) the Notes are
no longer outstanding (the date of such latest occurrence being the “End Date”),
the Company will (A) cause its Common Stock to continue to be registered under
Section 12(b) or 12(g) of the 1934 Act, (B) comply in all respects with its
reporting and filing obligations under the 1934 Act, (C) voluntarily comply with
all reporting requirements that are applicable to an issuer with a class of
shares registered pursuant to Section 12(g) of the 1934 Act, if the Company is
not subject to such reporting requirements, and (D) comply with all requirements
related to any registration statement filed pursuant to this Agreement.  The
Company will use its best efforts not to take any action or file any document
(whether or not permitted by the 1933 Act or the 1934 Act or the rules
thereunder) to terminate or suspend such registration or to terminate or suspend
its reporting and filing obligations under said acts until the End Date.  Until
the End Date, the Company will continue the listing or quotation of the Common
Stock on a Principal Market and will comply in all respects with the Company’s
reporting, filing and other obligations under the bylaws or rules of the
Principal Market.  The Company agrees to timely file a Form D with respect to
the Securities if required under Regulation D and to provide a copy thereof to
each Subscriber promptly after such filing.
 
 
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(e)           Use of Proceeds.  The proceeds of the Offering must be employed by
the Company for general corporate purposes and working capital.   The Purchase
Price may not and will not be used for accrued and unpaid officer and director
salaries, payment of financing related debt, redemption of outstanding notes or
equity instruments of the Company or non-trade obligations outstanding on a
Closing Date.  For so long as any Notes are outstanding, the Company will not
prepay any financing related debt obligations nor redeem any equity instruments
of the Company without the prior consent of the Subscribers.
 
(f)           Reservation.  Prior to the Closing, the Company undertakes to
reserve, authorized but unissued Common Stock, a number of common shares equal
to 300% of the amount of Common Stock necessary to allow the holder of the Note
to be able to convert all such outstanding Notes and reserve the amount of
Warrant Shares issuable upon exercise of the Warrants .   Failure to have
sufficient shares reserved pursuant to this Section 9(f) at any time shall be a
material default of the Company’s obligations under this Agreement and an Event
of Default under the Note.
 
(g)           Taxes.  From the date of this Agreement and until the End Date,
the Company will promptly pay and discharge, or cause to be paid and discharged,
when due and payable, all lawful taxes, assessments and governmental charges or
levies imposed upon the income, profits, property or business of the Company;
provided, however, that any such tax, assessment, charge or levy need not be
paid if the validity thereof shall be contested in good faith by appropriate
proceedings and if the Company shall have set aside on its books adequate
reserves with respect thereto, and provided, further, that the Company will pay
all such taxes, assessments, charges or levies forthwith upon the commencement
of proceedings to foreclose any lien which may have attached as security
therefore.
 
(h)           Insurance.  From the date of this Agreement and until the End
Date, the Company will keep its assets which are of an insurable character
insured by financially sound and reputable insurers against loss or damage by
fire, explosion and other risks customarily insured against by companies in the
Company’s line of business, in amounts sufficient to prevent the Company from
becoming a co-insurer and not in any event less than one hundred percent (100%)
of the insurable value of the property insured less reasonable deductible
amounts; and the Company will maintain, with financially sound and reputable
insurers, insurance against other hazards and risks and liability to persons and
property to the extent and in the manner customary for companies in similar
businesses similarly situated and to the extent available on commercially
reasonable terms.
 
(i)           Books and Records.  From the date of this Agreement and until the
End Date, the Company will keep records and books of account in which entries
will be made of all dealings or transactions in relation to its business and
affairs in accordance with generally accepted accounting principles applied on a
consistent basis.
 
(j)           Governmental Authorities.  From the date of this Agreement and
until the End Date, the Company shall duly observe and conform in all material
respects to all valid requirements of governmental authorities relating to the
conduct of its business or to its properties or assets.
 
(k)           Intellectual Property.  From the date of this Agreement and until
the End Date, the Company shall maintain in full force and effect its corporate
existence, rights and franchises and all licenses and other rights to use
intellectual property owned or possessed by it and reasonably deemed to be
necessary to the conduct of its business, unless it is sold for value.
 
(l)           Properties.  From the date of this Agreement and until the End
Date, the Company will keep its properties in good repair, working order and
condition, reasonable wear and tear excepted, and from time to time make all
necessary and proper repairs, renewals, replacements, additions and improvements
thereto; and the Company will at all times comply with each provision of all
leases to which it is a party or under which it occupies property if the breach
of such provision could reasonably be expected to have a Material Adverse
Effect.
 
(m)           Confidentiality/Public Announcement.  From the date of this
Agreement and until the End Date, the Company agrees that except in connection
with a Form 8-K and the registration statement or statements regarding the
Subscribers’ securities or in correspondence with the SEC regarding same, it
will not disclose publicly or privately the identity of the Subscribers unless
expressly agreed to in writing by a Subscriber or only to the extent required by
law and then only upon five days prior notice to Subscriber.  In any event and
subject to the foregoing, the Company undertakes to file a Form 8-K or make a
public announcement describing the Offering not later than the business day
after the Closing Date.  Prior to filing or announcement, such Form 8-K or
public announcement will be provided to Subscribers for their review and
approval.  In the Form 8-K or public announcement, the Company will specifically
disclose the amount of Common Stock outstanding immediately after the
Closing.  Upon  delivery by the Company to the Subscribers after the Closing
Date of any notice or information, in writing, electronically or otherwise, and
while a Note, Purchased Shares, Shares, Warrants, or Warrant Shares are held by
such Subscribers, unless the  Company has in good faith determined that the
matters relating to such notice do not
 
 
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constitute material, nonpublic information relating to the Company or
Subsidiaries, the Company  shall within one business day after any such delivery
publicly disclose such  material,  nonpublic  information on a
Report on Form 8-K or otherwise.  In the event that the Company believes that a
notice or communication to a Subscriber contains material, nonpublic
information, relating to the Company or Subsidiaries, the Company shall so
indicate to such Subscriber prior to delivery of such notice or
information.  Subscriber will be granted sufficient time to notify the Company
that Subscriber elects not to receive such information.   In such case, the
Company will not deliver such information to Subscriber.  In the absence of any
such indication, such Subscriber shall be allowed to presume that all matters
relating to such notice and information do not constitute material, nonpublic
information relating to the Company or its Subsidiaries.

(n)           Non-Public Information.  The Company covenants and agrees that
except for the Reports, Other Written Information and schedules and exhibits to
this Agreement and any other disclosure required under the Transaction
Documents, which information the Company undertakes to publicly disclose not
later than the sooner of the required or actual filing date of the Form 8-K
described in Section 9(m) above, neither it nor any other person acting on its
behalf will at any time provide any Subscriber or its agents or counsel with any
information that the Company believes constitutes material non-public
information, unless prior thereto such Subscriber shall have agreed in writing
to accept such information.  The Company understands and confirms that each
Subscriber shall be relying on the foregoing representations in effecting
transactions in securities of the Company.
 
(o)           Negative Covenants.  So long as a Note is outstanding, without the
consent of the Subscribers, the Company will not and will not permit any of its
Subsidiaries to directly or indirectly:
 
(i)           create, incur, assume or suffer to exist any pledge,
hypothecation, assignment, deposit arrangement, lien, charge, claim, security
interest, security title, mortgage, security deed or deed of trust, easement or
encumbrance, or preference, priority or other security agreement or preferential
arrangement of any kind or nature whatsoever (including any lease or title
retention agreement, any financing lease having substantially the same economic
effect as any of the foregoing, and the filing of, or agreement to give, any
financing statement perfecting a security interest under the Uniform Commercial
Code or comparable law of any jurisdiction) (each, a “Lien”) upon any of its
property, whether now owned or hereafter acquired except for: (A) the Excepted
Issuances (as defined in Section 12 hereof, (B) Liens imposed by law for taxes
that are not yet due or are being contested in good faith and for which adequate
reserves have been established in accordance with generally accepted accounting
principles; (C) carriers’, warehousemen’s, mechanics’, material men’s,
repairmen’s and other like Liens imposed by law, arising in the ordinary course
of business and securing obligations that are not overdue by more than 30 days
or that are being contested in good faith and by appropriate proceedings; (D)
pledges and deposits made in the ordinary course of business in compliance with
workers’ compensation, unemployment insurance and other social security laws or
regulations; (E) deposits to secure the performance of bids, trade contracts,
leases, statutory obligations, surety and appeal bonds, performance bonds and
other obligations of a like nature, in each case in the ordinary course of
business; (F) Liens created with respect to the financing of the purchase of
property in the ordinary course of the Company’s business up to the amount of
the purchase price of such property; and (G) easements, zoning restrictions,
rights-of-way and similar encumbrances on real property imposed by law or
arising in the ordinary course of business that do not secure any monetary
obligations and do not materially detract from the value of the affected
property (each of (B) through (G), a “Permitted Lien”);
 
(ii)           amend its certificate of incorporation, by-laws or its charter
documents so as to adversely affect any rights of the Subscribers;
 
(iii)           repay, repurchase or offer to repay, repurchase or otherwise
acquire or make any dividend or distribution in respect of any of its Common
Stock, preferred stock, or other equity securities other than to the extent
permitted or required under the Transaction Documents;
 
(iv)           prepay or redeem any financing related debt or past due
obligations outstanding as of the Closing Date;
 
(v)           engage in any transactions with any officer, director, employee or
any Affiliate (excluding a Subsidiary) of the Company, including any contract,
agreement or other arrangement providing for the furnishing of services to or
by, providing for rental of real or personal property to or from, or otherwise
requiring payments to or from any officer, director or such employee or, to the
knowledge of the Company, any entity in which any officer, director, or any such
employee has a substantial interest or is an officer, director, trustee or
partner, in each case in excess of $100,000 other than (i) for payment of salary
and bonuses or consulting fees for services rendered, (ii) reimbursement for
expenses incurred on behalf of the Company, (iii) for other employee benefits,
including stock option agreements under any stock option plan of the Company,
and (iv) pursuant to existing contractual agreements; or
 
 
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(vi)           the Company agrees to provide Subscribers not less than ten (10)
days notice prior to becoming obligated to or effectuating a Permitted Lien or
Excepted Issuance.
 
(p)           Seniority.  Except for Permitted Liens and as otherwise provided
for herein, until the Notes are fully satisfied or converted, the Company shall
not grant nor allow any security interest to be taken in the assets of the
Company or any Subsidiary; nor issue any debt, equity or other instrument which
would give the holder thereof directly or indirectly, a right in any assets of
the Company or any Subsidiary, superior to any right of the holder of a Note in
or to such assets.
 
(q)           DTC Program.  At all times that Notes or Warrants are outstanding,
the Company will employ as the transfer agent for the Common Stock, Shares and
Warrant Shares a participant in the Depository Trust Company Automated
Securities Transfer Program.
 
(r)           Lockbox of Funds.  After thirty days of the Company not filing a
registration statement for the note and the equity line stock purchase agreement
or Until the Notes are fully satisfied or converted, the Company agrees to
segregate solely, for the benefit of Subscribers, all proceeds received from any
and all private placements, funding transactions, loans to the Company and/or
its Subsidiaries and warrant exercises in order to repay the Notes. In the event
that the Company breaks this agreement, the Investor will not be obligated to
honor its equity line commitment.
 
10.          Covenants of the Company and Subscriber Regarding Indemnification.
 
(a)           The Company agrees to indemnify, hold harmless, reimburse and
defend the Subscribers, the Subscribers’ officers, directors, agents,
Affiliates, control persons and principal shareholders, against any claim, cost,
expense, liability, obligation, loss or damage (including reasonable legal fees)
of any nature, incurred by or imposed upon the Subscriber or any such person
which results, arises out of or is based upon (i) any material misrepresentation
by the Company or breach of any warranty by the Company in this Agreement or in
any Exhibits or Schedules attached hereto, or other Transaction Documents
delivered pursuant hereto, or (ii) after any applicable notice and/or cure
periods, any breach or default in performance by the Company of any covenant or
undertaking to be performed by the Company hereunder, or any other Transaction
Documents entered into by the Company and Subscriber relating hereto.
 
(b)           Each Subscriber agrees to indemnify, hold harmless, reimburse and
defend the Company and each of the Company’s officers, directors, agents,
Affiliates, control persons and principal shareholders against any claim, cost,
expense, liability, obligation, loss or damage (including reasonable legal fees)
of any nature, incurred by or imposed upon the Company or any such person which
results, arises out of or is based upon (i) any material misrepresentation by
such Subscriber in this Agreement or in any Exhibits or Schedules attached
hereto, or other Transaction Documents delivered pursuant hereto; or (ii) after
any applicable notice and/or cure periods, any breach or default in performance
by such Subscriber of any covenant or undertaking to be performed by such
Subscriber hereunder, or any other Transaction Documents entered into by the
Company and Subscribers, relating hereto.
 
(c)           In no event shall the liability of any Subscriber or permitted
successor hereunder or under any Transaction Document or other agreement
delivered in connection herewith be greater in amount than the dollar amount of
the net proceeds actually received by such Subscriber upon the sale of
Securities.
 
(d)           The procedures set forth in Section 11.6 of the Subscription
Agreement shall apply to the indemnification set forth in Sections 10(a) and
10(b) above.
 
11.1.          Piggyback Registration Rights.  The Company hereby grants the
following registration rights to holders of the Securities.  If the Company at
any time proposes to register any of its securities under the 1933 Act for sale
to the public, whether for its own account or for the account of other security
holders or both, except with respect to registration statements on Forms S-4,
S-8 or another form not available for registering the Purchased Shares and
Warrant Shares (collectively, the “Registrable Securities”) for sale to the
public, provided the Registrable Securities are not otherwise registered for
resale by the Subscribers or Holder pursuant to an effective registration
statement, each such time it will give at least fifteen (15) days' prior written
notice to the record holder of the Registrable Securities of its intention so to
do. Upon the written request of the holder, received by the Company within ten
(10) days after the giving of any such notice by the Company, to register any of
the Registrable Securities not previously registered, the Company will cause
such Registrable Securities as to which registration shall have been so
requested to be included with the securities to be covered by the registration
statement proposed to be filed by the Company, all to the extent required to
permit the sale or other disposition of the Registrable Securities so registered
by the holder of such Registrable Securities (the “Seller” or
“Sellers”).  Unless instructed in writing to the contrary, the Subscribers
hereby automatically exercise the registration rights granted in this Section
11.1.  The Seller is hereby given the same rights and benefits as any other
party identified in such registration.   In the event that any registration
pursuant to this Section 11.1 shall be, in whole or in part, an underwritten
public offering of common stock of the Company, the number of shares of
Registrable Securities to be included in such an underwriting may be reduced by
the managing underwriter if and to the extent that the Company and the
underwriter shall reasonably be of the opinion that such inclusion would
adversely affect the marketing of the securities to be sold by the Company
therein; provided, however, that the Company shall notify the Seller in writing
of any such reduction. Notwithstanding the foregoing provisions, or Section 11.4
hereof, the Company may withdraw or delay or suffer a delay of any registration
statement referred to in this Section 11.1 without thereby incurring any
liability to the Seller due to such withdrawal or delay.
 
 
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11.2.          Registration Procedures.   If and whenever the Company is
required by the provisions of Section 11.1 to effect the registration of any
Registrable Securities under the 1933 Act, the Company will, as expeditiously as
possible:

(a)           subject to the timelines provided in this Agreement, prepare and
file with the Commission a registration statement required by Section 11, with
respect to the Registrable Securities and use its best efforts to cause such
registration statement to become and remain effective for the period of the
distribution contemplated thereby (determined as herein provided), and promptly
provide to the holders of the Registrable Securities copies of all filings and
Commission letters of comment and notify Subscriber and Yosef Y. Manela
Esq.  (ymanela@gmail.com) within one (1) business day of (i) notice that the
Commission has no comments or no further comments on the Registration Statement,
and (ii) the declaration of effectiveness of the registration statement;

(b)           furnish to the Sellers, at the Company’s expense, such number of
copies of the registration statement and the prospectus included therein
(including each preliminary prospectus) as such persons reasonably may request
in order to facilitate the public sale or their disposition of the securities
covered by such registration statement;

(c)           use its best efforts to register or qualify the Registrable
Securities covered by such registration statement under the securities or “blue
sky” laws of such jurisdictions as the Sellers shall request in writing,
provided, however, that the Company shall not for any such purpose be required
to qualify generally to transact business as a foreign corporation in any
jurisdiction where it is not so qualified or to consent to general service of
process in any such jurisdiction;

(d)           if applicable, list the Registrable Securities covered by such
registration statement with any securities exchange on which the Common Stock of
the Company is then listed;

(e)           immediately notify the Sellers when a prospectus relating thereto
is required to be delivered under the 1933 Act, of the happening of any event of
which the Company has knowledge as a result of which the prospectus contained in
such registration statement, as then in effect, includes an untrue statement of
a material fact or omits to state a material fact required to be stated therein
or necessary to make the statements therein not misleading in light of the
circumstances then existing; and

(f)           provided same would not be in violation of the provision of
Regulation FD under the 1934 Act, make available for inspection by the
Sellers,  and any attorney, accountant or other agent retained by the Seller or
underwriter, all publicly available, non-confidential financial and other
records, pertinent corporate documents and properties of the Company, and cause
the Company's officers, directors and employees to supply all publicly
available, non-confidential information reasonably requested by the seller,
attorney, accountant or agent in connection with such registration statement.

11.3.           Provision of Documents.  In connection with each registration
described in this Section 11, each Seller will furnish to the Company in writing
such information and representation letters with respect to itself and the
proposed distribution by it as reasonably shall be necessary in order to assure
compliance with federal and applicable state securities laws.

11.4.           intentionally omitted.
 
11.5.           Expenses.  All expenses incurred by the Company in complying
with Section 11, including, without limitation, all registration and filing
fees, printing expenses, fees and disbursements of counsel and independent
public accountants for the Company, fees and expenses (including reasonable
counsel fees) incurred in connection with complying with state securities or
“blue sky” laws, fees of the National Association of Securities Dealers, Inc.,
transfer taxes, fees of transfer agents and registrars, costs of insurance and
fee of one counsel for the Seller are called “Registration Expenses.” All
underwriting discounts and selling commissions applicable to the sale of
Registrable Securities, including any fees and disbursements of any additional
counsel to the Seller, are called "Selling Expenses."  The Company will pay all
Registration Expenses in connection with the registration statement under
Section 11.  Selling Expenses in connection with each registration statement
under Section 11 shall be borne by the Seller. The exception to this is the
$25,000 fee which will be paid out of escrow, and will cover all of the
Subscriber’s costs for the note and equity line.
 
 
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11.6.           Indemnification and Contribution.

(a)           In the event of a registration of any Registrable Securities under
the 1933 Act pursuant to Section 11, the Company will, to the extent permitted
by law, indemnify and hold harmless the Seller, each officer of the Seller, each
director of the Seller, each underwriter of such Registrable Securities
thereunder and each other person, if any, who controls such Seller or
underwriter within the meaning of the 1933 Act, against any losses, claims,
damages or liabilities, joint or several, to which the Seller, or such
underwriter or controlling person may become subject under the 1933 Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon any untrue statement or alleged
untrue statement of any material fact contained in any registration statement
under which such Registrable Securities were registered under the 1933 Act
pursuant to Section 11, any preliminary prospectus or final prospectus contained
therein, or any amendment or supplement thereof, or arise out of or are based
upon the omission or alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements therein not misleading
in light of the circumstances when made, and will subject to the provisions of
Section 11.6(c) reimburse the Seller, each such underwriter and each such
controlling person for any legal or other expenses reasonably incurred by them
in connection with investigating or defending any such loss, claim, damage,
liability or action; provided, however, that the Company shall not be liable to
the Seller to the extent that any such damages arise out of or are based upon an
untrue statement or omission made in any preliminary prospectus if (i) the
Seller failed to send or deliver a copy of the final prospectus delivered by the
Company to the Seller with or prior to the delivery of written confirmation of
the sale by the Seller to the person asserting the claim from which such damages
arise, (ii) the final prospectus would have corrected such untrue statement or
alleged untrue statement or such omission or alleged omission, or (iii) to the
extent that any such loss, claim, damage or liability arises out of or is based
upon an untrue statement or alleged untrue statement or omission or alleged
omission so made in conformity with information furnished by any such Seller, or
any such controlling person in writing specifically for use in such registration
statement or prospectus.

(b)           In the event of a registration of any of the Registrable
Securities under the 1933 Act pursuant to Section 11, the Seller severally but
not jointly will, to the extent permitted by law, indemnify and hold harmless
the Company, and each person, if any, who controls the Company within the
meaning of the 1933 Act, each officer of the Company who signs the registration
statement, each director of the Company, each underwriter and each person who
controls any underwriter within the meaning of the 1933 Act, against all losses,
claims, damages or liabilities, joint or several, to which the Company or such
officer, director, underwriter or controlling person may become subject under
the 1933 Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon any
untrue statement or alleged untrue statement of any material fact contained in
the registration statement under which such Registrable Securities were
registered under the 1933 Act pursuant to Section 11, any preliminary prospectus
or final prospectus contained therein, or any amendment or supplement thereof,
or arise out of or are based upon the omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein not misleading, and will reimburse the Company and each such
officer, director, underwriter and controlling person for any legal or other
expenses reasonably incurred by them in connection with investigating or
defending any such loss, claim, damage, liability or action, provided, however,
that the Seller will be liable hereunder in any such case if and only to the
extent that any such loss, claim, damage or liability arises out of or is based
upon an untrue statement or alleged untrue statement or omission or alleged
omission made in reliance upon and in conformity with information pertaining to
such Seller, as such, furnished in writing to the Company by such Seller
specifically for use in such registration statement or prospectus, and provided,
further, however, that the liability of the Seller hereunder shall be limited to
the net proceeds actually received by the Seller from the sale of Registrable
Securities covered by such registration statement.

(c)           Promptly after receipt by an indemnified party hereunder of notice
of the commencement of any action, such indemnified party shall, if a claim in
respect thereof is to be made against the indemnifying party hereunder, notify
the indemnifying party in writing thereof, but the omission so to notify the
indemnifying party shall not relieve it from any liability which it may have to
such indemnified party other than under this Section 11.6(c) and shall only
relieve it from any liability which it may have to such indemnified party under
this Section 11.6(c), except and only if and to the extent the indemnifying
party is prejudiced by such omission. In case any such action shall be brought
against any indemnified party and it shall notify the indemnifying party of the
commencement thereof, the indemnifying party shall be entitled to participate in
and, to the extent it shall wish, to assume and undertake the defense thereof
with counsel satisfactory to such indemnified party, and, after notice from the
indemnifying party to such indemnified party of its election so to assume and
undertake the defense thereof, the indemnifying party shall not be liable to
such indemnified party under this Section 11.6(c) for any legal expenses
subsequently incurred by such indemnified party in connection with the defense
thereof other than reasonable costs of investigation and of liaison with counsel
so selected, provided, however, that, if the defendants in any such action
include both the indemnified party and the indemnifying party and the
indemnified party shall have reasonably concluded that there may be reasonable
defenses available to it which are different from or additional to those
available to the indemnifying party or if the interests of the indemnified party
reasonably may be deemed to conflict with the interests of the indemnifying
party, the indemnified parties, as a group, shall have the right to select one
separate counsel and to assume such legal defenses and otherwise to participate
in the defense of such action, with the reasonable expenses and fees of such
separate counsel and other expenses related to such participation to be
reimbursed by the indemnifying party as incurred.
 
 
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(d)           In order to provide for just and equitable contribution in the
event of joint liability under the 1933 Act in any case in which either (i) a
Seller, or any controlling person of a Seller, makes a claim for indemnification
pursuant to this Section 11.6 but it is judicially determined (by the entry of a
final judgment or decree by a court of competent jurisdiction and the expiration
of time to appeal or the denial of the last right of appeal) that such
indemnification may not be enforced in such case notwithstanding the fact that
this Section 11.6 provides for indemnification in such case, or (ii)
contribution under the 1933 Act may be required on the part of the Seller or
controlling person of the Seller in circumstances for which indemnification is
not provided under this Section 11.6; then, and in each such case, the Company
and the Seller will contribute to the aggregate losses, claims, damages or
liabilities to which they may be subject (after contribution from others) in
such proportion so that the Seller is responsible only for the portion
represented by the percentage that the public offering price of its securities
offered by the registration statement bears to the public offering price of all
securities offered by such registration statement, provided, however, that, in
any such case, (y) the Seller will not be required to contribute any amount in
excess of the public offering price of all such securities sold by it pursuant
to such registration statement; and (z) no person or entity guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the 1933 Act) will be
entitled to contribution from any person or entity who was not guilty of such
fraudulent misrepresentation.

11.7.           Delivery of Unlegended Shares.

(a)           Within three (3) business days (such third business day being the
“Unlegended Shares Delivery Date”) after the business day on which the Company
has received (i) a notice that Purchased Shares or Warrant Shares have been sold
pursuant to a registration statement or Rule 144 under the 1933 Act, (ii) a
representation that the prospectus delivery requirements, or the requirements of
Rule 144, as applicable and if required, have been satisfied, and (iii) the
original share certificates representing the shares of Common Stock that have
been sold, and (iv) in the case of sales under Rule 144, customary
representation letters of the Subscriber and/or Subscriber’s broker regarding
compliance with the requirements of Rule 144, the Company at its expense, (y)
shall deliver, and shall cause legal counsel selected by the Company to deliver
to its transfer agent (with copies to Subscriber) an appropriate instruction and
opinion of such counsel, directing the delivery of shares of Common Stock
without any legends including the legend set forth in Section 4 above,
reissuable pursuant to any effective and current Registration Statement
described in Section 11 of this Agreement or pursuant to Rule 144 under the 1933
Act (the “Unlegended Shares”); and (z) cause the transmission of the
certificates representing the Unlegended Shares together with a legended
certificate representing the balance of the submitted Purchased Shares or
Warrant Shares certificate, if any, to the Subscriber at the address specified
in the notice of sale, via express courier, by electronic transfer or otherwise
on or before the Unlegended Shares Delivery Date.

(b)           In lieu of delivering physical certificates representing the
Unlegended Shares, if the Company’s transfer agent is participating in the
Depository Trust Company (“DTC”) Fast Automated Securities Transfer program,
upon request of the Subscriber, so long as the certificates therefore do not
bear a legend and the Subscriber is not obligated to return such certificate for
the placement of a legend thereon, the Company must cause its transfer agent to
electronically transmit the Unlegended Shares by crediting the account of
Subscriber’s prime Broker with DTC through its Deposit Withdrawal Agent
Commission system.  Such delivery must be made on or before the Unlegended
Shares Delivery Date.

(c)           The Company understands that a delay in the delivery of the
Unlegended Shares pursuant to Section 11 hereof after the Unlegended Shares
Delivery Date could result in economic loss to Subscriber.  As compensation to
Subscriber for such loss, the Company agrees to pay late payment fees (as
liquidated damages and not as a penalty) to the Subscriber for late delivery of
Unlegended Shares in the amount of $100 per business day after the Delivery Date
for each $10,000 of Purchase Price (at an attributed value of $1.00 per
Purchased Share and the “Purchase Price” as defined in the Warrants) of the
Unlegended Shares subject to the delivery default.  If during any 360 day
period, the Company fails to deliver Unlegended Shares as required by this
Section 11.7 for an aggregate of thirty (30) days, then each Subscriber or
assignee holding Securities subject to such default may, at its option, require
the Company to redeem all or any portion of the Purchased Shares or Warrant
Shares subject to such default at a price per share equal to 120% of the
Purchase Price of such Purchased Shares or Warrant Shares (“Unlegended
Redemption Amount”).

(d)           In addition to any other rights available to a Subscriber, if the
Company fails to deliver to a Subscriber Unlegended Shares as required pursuant
to this Agreement, within seven (7) business days after the Unlegended Shares
Delivery Date and the Subscriber or a broker on the Subscriber’s behalf,
purchases (in an open market transaction or otherwise) shares of common stock to
deliver in satisfaction of a sale by such Subscriber of the shares of Common
Stock which the Subscriber was entitled to receive from the Company (a
"Buy-In"), then the Company shall pay in cash to the Subscriber (in addition to
any remedies available to or elected by the Subscriber) the amount by which (A)
the Subscriber's total purchase price (including brokerage commissions, if any)
for the shares of common stock so purchased exceeds (B) the aggregate
 
 
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purchase price of the shares of Common Stock delivered to the Company for
reissuance as Unlegended Shares together with interest thereon at a rate of 15%
per annum, accruing until such amount and any accrued interest thereon is paid
in full (which amount shall be paid as liquidated damages and not as a
penalty).  For example, if a Subscriber purchases shares of Common Stock having
a total purchase price of $11,000 to cover a Buy-In with respect to $10,000 of
Purchase Price of shares of Common Stock delivered to the Company for reissuance
as Unlegended Shares, the Company shall be required to pay the Subscriber
$1,000, plus interest. The Subscriber shall provide the Company written notice
indicating the amounts payable to the Subscriber in respect of the Buy-In.

(e)           In the event a Subscriber shall request delivery of Unlegended
Shares as described in Section 11.7 and the Company is required to deliver such
Unlegended Shares pursuant to Section 11.7, the Company may not refuse to
deliver Unlegended Shares based on any claim that such Subscriber or any one
associated or affiliated with such Subscriber has been engaged in any violation
of law, or for any other reason, unless, an injunction or temporary restraining
order from a court, on notice, restraining and or enjoining delivery of such
Unlegended Shares or exercise of all or part of said Warrant shall have been
sought and obtained by the Company or at the Company’s request or with the
Company’s assistance, and the Company has posted a surety bond for the benefit
of such Subscriber in the amount of 120% of the amount of the Purchase Price of
the Purchased Shares and Warrant Shares which are subject to the injunction or
temporary restraining order, which bond shall remain in effect until the
completion of arbitration/litigation of the dispute and the proceeds of which
shall be payable to such Subscriber to the extent Subscriber obtains judgment in
Subscriber’s favor.

 
 (f)           Maximum Exercise of Rights.  In the event the exercise of the
rights described in Sections 12(a) or 12(b) would or could result in the
issuance of an amount of Common Stock of the Company that would exceed the
maximum amount that may be issued to a Subscriber calculated in the manner
described in Section 7.3 of this Agreement, then the issuance of such additional
shares of Common Stock of the Company to such Subscriber will be deferred in
whole or in part until such time as such Subscriber is able to beneficially own
such Common Stock without exceeding the applicable maximum amount set forth
calculated in the manner described in Section 7.3 of this Agreement.  The
determination of when such Common Stock may be issued shall be made by each
Subscriber as to only such Subscriber.
 
13.           Security Interest.   The Subscriber will be granted a senior
security interest in all of the assets of the Company, including ownership of
any Subsidiaries and in the assets of the Subsidiaries The Subsidiaries will
guaranty the Company’s obligations under the Transaction Documents. The Company
will execute such other agreements, documents and financing statements
reasonably requested by the Subscribers, which will be filed at the Company’s
expense with the jurisdictions, states and counties designated by the
Subscribers. The Company will also execute all such documents reasonably
necessary in the opinion of the Subscriber to memorialize and further protect
the security interest described herein.  The Subscriber will appoint a
Collateral Agent to represent him in connection with the security interests to
be granted to the Subscriber. This will only be applicable until the Bridge Loan
is paid. Once the Bridge Loan is paid, there will be no Security Interest in the
Company by the Subscriber.
 
14.           Miscellaneous.
 
(a)           Notices.  All notices, demands, requests, consents, approvals, and
other communications required or permitted hereunder shall be in writing and,
unless otherwise specified herein, shall be (i) personally served, (ii)
deposited in the mail, registered or certified, return receipt requested,
postage prepaid, (iii) delivered by reputable overnight courier service with
charges prepaid, or (iv) transmitted by hand delivery, telegram, or facsimile,
addressed as set forth below or to such other address as such party shall have
specified most recently by written notice.  Any notice or other communication
required or permitted to be given hereunder shall be deemed effective (a) upon
hand delivery or delivery by facsimile, with accurate confirmation generated by
the transmitting facsimile machine, at the address or number designated below
(if delivered on a business day during normal business hours where such notice
is to be received), or the first business day following such delivery (if
delivered other than on a business day during normal business hours where such
notice is to be received), (b) on the first business day following the date
deposited with an overnight courier service with charges prepaid, or (c) on the
third business day following the date of mailing pursuant to subpart (a)(ii)
above, or upon actual receipt of such mailing, whichever shall first occur.  The
addresses for such communications shall be provided to each Party at closing.
 
(b)           Entire Agreement; Assignment.  This Agreement and other documents
delivered in connection herewith represent the entire agreement between the
parties hereto with respect to the subject matter hereof and may be amended only
by a writing executed by both parties.  Neither the Company nor the Subscriber
have relied on any representations not contained or referred to in this
Agreement and the documents delivered herewith.   No right or obligation of the
Company shall be assigned without prior notice to and the written consent of the
Subscribers. The Subscriber shall promptly provide the Company with written
notice of the assignment or delegation of any of its rights or obligations under
this Agreement.
 
 
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(c)           Counterparts/Execution.  This Agreement may be executed in any
number of counterparts and by the different signatories hereto on separate
counterparts, each of which, when so executed, shall be deemed an original, but
all such counterparts shall constitute but one and the same instrument.  This
Agreement may be executed by facsimile signature and delivered by facsimile
transmission.
 
(d)           Law Governing this Agreement.  This Agreement shall be governed by
and construed in accordance with the laws of the State of New York without
regard to conflicts of laws principles that would result in the application of
the substantive laws of another jurisdiction.  Any action brought by either
party against the other concerning the transactions contemplated by this
Agreement shall be brought only in the civil or state courts of New York or in
the federal courts located in the State of New York.  The parties and the
individuals executing this Agreement and other agreements referred to herein or
delivered in connection herewith on behalf of the Company agree to submit to the
jurisdiction of such courts and waive trial by jury.  The prevailing party shall
be entitled to recover from the other party its reasonable attorney’s fees and
costs.  In the event that any provision of this Agreement or any other agreement
delivered in connection herewith is invalid or unenforceable under any
applicable statute or rule of law, then such provision shall be deemed
inoperative to the extent that it may conflict therewith and shall be deemed
modified to conform with such statute or rule of law.  Any such provision which
may prove invalid or unenforceable under any law shall not affect the validity
or enforceability of any other provision of any agreement.
 
(e)           Specific Enforcement, Consent to Jurisdiction.  To the extent
permitted by law, the Company and Subscriber acknowledge and agree that
irreparable damage would occur in the event that any of the provisions of this
Agreement were not performed in accordance with their specific terms or were
otherwise breached.  It is accordingly agreed that the parties shall be entitled
to one or more preliminary and final injunctions to prevent or cure breaches of
the provisions of this Agreement and to enforce specifically the terms and
provisions hereof, this being in addition to any other remedy to which any of
them may be entitled by law or equity.  Subject to Section 14(d) hereof, each of
the Company, Subscriber and any signator hereto in his or her personal capacity
hereby waives, and agrees not to assert in any such suit, action or proceeding,
any claim that it is not personally subject to the jurisdiction in New York of
such court, that the suit, action or proceeding is brought in an inconvenient
forum or that the venue of the suit, action or proceeding is improper.  Nothing
in this Section shall affect or limit any right to serve process in any other
manner permitted by law.
 
 (f)           Captions: Certain Definitions.  The captions of the various
sections and paragraphs of this Agreement have been inserted only for the
purposes of convenience; such captions are not a part of this Agreement and
shall not be deemed in any manner to modify, explain, enlarge or restrict any of
the provisions of this Agreement.  As used in this Agreement the term “person”
shall mean and include an individual, a partnership, a joint venture, a
corporation, a limited liability company, a trust, an unincorporated
organization and a government or any department or agency thereof.
 
(g)           Calendar Days.  All references to “days” in the Transaction
Documents (as hereinafter defined) shall mean calendar days unless otherwise
stated.  The terms “business days” and “trading days” shall mean days that the
New York Stock Exchange is open for trading for three or more hours.  Time
periods shall be determined as if the relevant action, calculation or time
period were occurring in New York City.
 
(h)           Severability.  In the event that any term or provision of this
Agreement shall be finally determined to be superseded, invalid, illegal or
otherwise unenforceable pursuant to applicable law by an authority having
jurisdiction and venue, that determination shall not impair or otherwise affect
the validity, legality or enforceability: (i) by or before that authority of the
remaining terms and provisions of this Agreement, which shall be enforced as if
the unenforceable term or provision were deleted, or (ii) by or before any other
authority of any of the terms and provisions of this Agreement.
 
(i)           Successor Laws.  References in the Transaction Documents to laws,
rules, regulations and forms shall also include successors to and functionally
equivalent replacements of such laws, rules, regulations and forms.  A successor
rule to 144(b)(1)(i) shall include any rule that would be available to a
non-Affiliate of the Company for the sale of Common Stock not subject to volume
restrictions and after a six month holding period.
 
 
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SIGNATURE PAGE TO SUBSCRIPTION AGREEMENT (A)
 
Please acknowledge your acceptance of the foregoing Subscription Agreement by
signing and returning a copy to the undersigned whereupon it shall become a
binding agreement between us.
 
 

  Greenchek Technology, Inc.          
 
By:
/s/ Lincoln Parke       Name:  Lincoln Parke       Title:   President          
    Dated: August 27, 2009  

SUBSCRIBER
PURCHASE PRICE AND PRINCIPAL AMOUNT OF NOTE
PURCHASED SHARES
CLASS A WARRANTS
CLASS B WARRANTS
Name of Subscriber:
 
Bodie Investment Group Inc.
 
Address: 25900 Greenfield Road, Suite 102
 
Oak Park, Michigan 48237
 
Fax No.: 248-569-9176
 
Taxpayer ID# (if applicable): ____________
 
 
/s/ Jack Bodenstein
(Signature)
By: Jack Bodenstein
 
 
$100,000
 
35,000,000
 
3,000,000
 
6,000,000

 

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