EX-10.1






EXHIBIT 10.1



SECURITIES PURCHASE AGREEMENT




This Securities Purchase Agreement (this “Agreement”) is dated as of October 19, 2007,
among Elixir Gaming Technologies, Inc., a Nevada corporation (the “Company”), and each
purchaser identified on the signature pages hereto (each, including its successors and assigns, a
"Purchaser,” and collectively, the “Purchasers”).



R E C I T A L S




WHEREAS, subject to the terms and conditions set forth in this Agreement and pursuant to
Section 4(2) of the Securities Act of 1933, as amended (the “Securities Act”), and Rule 506
promulgated thereunder, the Company desires to issue and sell to each Purchaser, and each
Purchaser, severally and not jointly, desires to purchase from the Company, securities of the
Company as more fully described in this Agreement.



A G R E E M E N T




NOW, THEREFORE, IN CONSIDERATION of the mutual covenants contained in this Agreement, and for
other good and valuable consideration the receipt and adequacy of which are hereby acknowledged,
the Company and each Purchaser hereby agree as follows:



ARTICLE I.




DEFINITIONS




1.1 Definitions. In addition to the terms defined elsewhere in this Agreement, for
all purposes of this Agreement, the following terms have the meanings indicated in this Section
1.1:




"Action” shall have the meaning ascribed to such term in Section 3.1(j).




"Affiliate” means any Person that, directly or indirectly through one or more
intermediaries, controls or is controlled by or is under common control with a Person as
such terms are used in and construed under Rule 144 under the Securities Act. With respect
to a Purchaser, any investment fund or managed account that is managed on a discretionary
basis by the same investment manager as such Purchaser will be deemed to be an Affiliate of
such Purchaser.




"Buy-In” shall have the meaning ascribed to such term in Section 4.1(f).




"Buy-In Price” shall have the meaning ascribed to such term in Section 4.1(f).




"Business Day” means any day except Saturday, Sunday and any day which shall be
a federal legal holiday in the United States.




"Closing” means the Closing of the purchase and sale of the Shares pursuant to
Section 2.1.




"Closing Date” means the Business Day when all of the Transaction Documents
have been executed and delivered by the applicable parties thereto, and all conditions
precedent to (i) the Purchasers’ obligations to pay the Subscription Amount and (ii) the
Company’s obligations to deliver the applicable Shares have been satisfied or waived.




"Commission” means the Securities and Exchange Commission.




"Common Stock” means the common stock of the Company, par value $0.001 per
share, and any other class of securities into which such securities may hereafter be
reclassified or changed into.




"Common Stock Equivalents” means any securities of the Company or the
Subsidiaries which would entitle the holder thereof to acquire at any time Common Stock,
including, without limitation, any debt, preferred stock, rights, options, warrants or other
instrument that is at any time convertible into or exercisable or exchangeable for, or
otherwise entitles the holder thereof to receive, Common Stock.




“Contingent Obligation” means, as to any Person, any direct or indirect
liability, contingent or otherwise, of that Person with respect to any indebtedness, lease,
dividend or other obligation of another Person if the primary purpose or intent of the
Person incurring such liability, or the primary effect thereof, is to provide assurance to
the obligee of such liability that such liability will be paid or discharged, or that any
agreements relating thereto will be complied with, or that the holders of such liability
will be protected (in whole or in part) against loss with respect thereto.




"Deadline Date” shall have the meaning ascribed to such term in Section 4.1(f).




"Disclosure Schedules” means the Disclosure Schedules of the Company delivered
in connection with the Closing.




"Effective Date” means the date that the initial Registration Statement filed
by the Company pursuant to the Registration Rights Agreement is first declared effective by
the Commission.




"Exchange Act” means the Securities Exchange Act of 1934, as amended, and the
rules and regulations promulgated thereunder.




"GAAP” shall have the meaning ascribed to such term in Section 3.1(h).




“Indebtedness” of any Person means, without duplication (a) all indebtedness
for borrowed money, (b) all obligations issued, undertaken or assumed as the deferred
purchase price of property or services (other than trade payables entered into in the
ordinary course of business), (c) all reimbursement or payment obligations with respect to
letters of credit, surety bonds and other similar instruments, (d) all obligations evidenced
by notes, bonds, debentures or similar instruments, including obligations so evidenced
incurred in connection with the acquisition of property, assets or businesses, (e) all
indebtedness created or arising under any conditional sale or other title retention
agreement, or incurred as financing, in either case with respect to any property or assets
acquired with the proceeds of such indebtedness (even though the rights and remedies of the
seller or bank under such agreement in the event of default are limited to repossession or
sale of such property), (f) all monetary obligations under any leasing or similar
arrangement which, in connection with generally accepted accounting principles, consistently
applied for the periods covered thereby, is classified as a capital lease, (g) all
indebtedness referred to in clauses (a) through (f) above secured by (or for which the
holder of such Indebtedness has an existing right, contingent or otherwise, to be secured
by) any mortgage, lien, pledge, charge, security interest or other encumbrance upon or in
any property or assets (including accounts and contract rights) owned by any Person, even
though the Person which owns such assets or property has not assumed or become liable for
the payment of such indebtedness, and (h) all Contingent Obligations in respect of
indebtedness or obligations of others of the kinds referred to in clauses (a) through (g)
above.




"Intellectual Property” shall have the meaning ascribed to such term in Section
3.1(o)(i).




"Liens” means a lien, charge, security interest, encumbrance, right of first
refusal, preemptive right or other restriction.




"Material Adverse Effect” shall have the meaning assigned to such term in
Section 3.1(b).




"Material Permits” shall have the meaning ascribed to such term in Section
3.1(m).




"Person” means an individual or corporation, partnership, trust, incorporated
or unincorporated association, joint venture, limited liability company, joint stock
company, government (or an agency or subdivision thereof) or other entity of any kind.




"Placement Agent” means ThinkEquity Partners, LLC.




"Proceeding” means an action, claim, suit, investigation or proceeding
(including, without limitation, an investigation or partial proceeding, such as a
deposition), whether commenced or threatened.




"Registration Rights Agreement” means the Registration Rights Agreement, dated
the date hereof, among the Company and the Purchasers, in the form of Exhibit A
attached hereto.




"Registration Statement” means a registration statement meeting the
requirements set forth in the Registration Rights Agreement and covering the resale by the
Purchasers of the Shares.




"Required Approvals” shall have the meaning ascribed to such term in Section
3.1(e).




"Rule 144” means Rule 144 promulgated by the Commission pursuant to the
Securities Act, as such Rule may be amended from time to time, or any similar rule or
regulation hereafter adopted by the Commission having substantially the same effect as such
Rule.




"SEC Reports” shall have the meaning ascribed to such term in Section 3.1(h).




"Shares” means the Fifteen Million (15,000,000) shares of Common Stock issued
or issuable to the Purchasers pursuant to this Agreement.




"Short Sales” shall include all “short sales” as defined in Rule 200 of
Regulation SHO under the Exchange Act (but shall not be deemed to include the location
and/or reservation of borrowable shares of Common Stock). 




"Subscription Amount” means, as to each Purchaser, the aggregate amount to be
paid for Shares purchased hereunder as specified below such Purchaser’s name on the
signature page of this Agreement and next to the heading “Subscription Amount,” in United
States Dollars and in immediately available funds.




"Subsidiary” means any subsidiary of the Company as set forth on Schedule
3.1(a).




“Trading Day” means (i) a day on which the Common Stock is listed or quoted for
trading on its primary Trading Market, or (ii) if the Common Stock is not quoted on any
Trading Market, a day on which the Common Stock is quoted for trading on the principal
securities exchange or securities market on which the Common Stock is then traded; provided
that in the event the Common Stock is not listed or quoted for trading as set forth in (i)
and (ii) hereof, then Trading Day shall mean “Business Day.”




"Trading Market” means the following markets or exchanges on which the Common
Stock is listed or quoted for trading on the date in question: the American Stock Exchange,
the New York Stock Exchange, the NASDAQ Global Select Market, the NASDAQ Global Market, or
the NASDAQ Capital Market.




"Transaction Documents” means this Agreement and the Registration Rights
Agreement executed in connection with the transactions contemplated hereunder.



ARTICLE II.




PURCHASE AND SALE




2.1 Closing. Upon the terms and subject to the conditions set forth herein, the
Company agrees to sell, and each Purchaser agrees to purchase, severally and not jointly, the
number of Shares set forth on each respective Purchaser’s signature page attached hereto, for the
Subscription Amount set forth thereon, which in the aggregate shall equal up to Fifty-Two Million
Five Hundred Thousand Dollars ($52,500,000) of Shares, based on the purchase price of $3.50 per
share. On the Closing Date (the “Closing Date”), each Purchaser shall deliver to the
Company, via wire transfer or a certified check, immediately available funds equal to their
Subscription Amount, and the Company shall deliver to each Purchaser their respective Shares to be
issued at the Closing (the “Closing”). Upon satisfaction of the conditions set forth in
Sections 2.2 and 2.3, the Closing shall occur at the offices of Greenberg Traurig, LLP, 3161
Michelson Drive, Suite 1000, Irvine, California 92612, or such other location as the parties shall
mutually agree.



2.2 Deliveries.




(a) On or prior to the Closing Date, the Company shall deliver or cause to be delivered
to each Purchaser the following:




(i) this Agreement duly executed by the Company;




(ii) one or more stock certificates evidencing that number of Shares purchased
by each Purchaser hereunder, registered in the name of such Purchaser;




(iii) the Registration Rights Agreement duly executed by the Company;




(iv) an opinion of Greenberg Traurig, LLP, dated as of the Closing Date, in
substantially the form attached hereto as Exhibit B and reasonably
acceptable to the Purchasers; and




(v) a certificate, in substantially the form attached hereto as Exhibit
C, executed by the Secretary of the Company and dated as of the Closing Date, as
to (i) the resolutions consistent with Section 3.1(c) as adopted by the Company’s
Board of Directors, and (ii) the Articles of Incorporation and Bylaws of the
Company, each as amended to date and in effect at the Closing.




(b) On or prior to the Closing Date, each Purchaser shall deliver or cause to be
delivered to the Company the following:




(i) this Agreement duly executed by such Purchaser;




(ii) such Purchaser’s Subscription Amount by wire transfer or certified check
to the escrow account as set forth in the Escrow Agreement attached hereto as
Exhibit D, (which wire instructions are set forth in Section 8(a) of the
Escrow Agreement); and




(iii) the Registration Rights Agreement duly executed by such Purchaser.



2.3 Closing Conditions. 




(a) The obligations of the Company hereunder in connection with the Closing are subject
to the following conditions being met:




(i) the representations and warranties of the Purchasers shall be true and
correct in all material respects (except for those representations and warranties
that are qualified by materiality or Material Adverse Effect, which shall be true
and correct in all respects) as of the date when made and as of the Closing Date as
though made at that time (except for representations and warranties that speak as of
a specific date, which shall remain true and correct as of such specific date);




(ii) all obligations, covenants and agreements of the Purchasers required to be
performed at or prior to the Closing Date with respect to the performance of this
Agreement and matters contemplated hereby shall have been performed;




(iii) the delivery by the Purchasers of the items set forth in Section 2.2(b)
of this Agreement;




(iv) the Company’s additional listing application for the Shares filed with the
American Stock Exchange (“AMEX”) shall have been approved by the AMEX, and the AMEX
shall have confirmed to the Company that the issuance of the Shares does not require
approval by the shareholders of the Company under the rules and regulations of the
AMEX;




(v) the Company shall have obtained all governmental, regulatory or third party
consents and approvals, as listed on Schedule 2.3, necessary for the sale of
the Shares;




(vi) no statute, rule, regulation, executive order, decree, ruling or
injunction shall have been enacted, entered, promulgated or endorsed by any court or
governmental authority of competent jurisdiction that prohibits the consummation of
any of the transactions contemplated by the Transaction Documents;




(vii) since the date of execution of this Agreement, no event or series of
events shall have occurred that resulted, or could reasonably be expected to result,
in a Material Adverse Effect; and




(viii) trading in the Common Stock shall not have been suspended by the
Commission or any Trading Market (except for any suspensions of trading of not more
than one trading day solely to permit dissemination of material information
regarding the Company) at any time since the date of execution of this Agreement,
and the Common Stock shall have been at all times since such date listed for trading
on a Trading Market.




(b) The respective obligations of the Purchasers hereunder in connection with the
Closing are subject to the following conditions being met:




(i) the representations and warranties of the Company shall be true and correct
in all material respects (except for those representations and warranties that are
qualified by materiality or Material Adverse Effect, which shall be true and correct
in all respects) as of the date when made and as of the Closing Date as though made
at that time (except for representations and warranties that speak as of a specific
date, which shall remain true and correct as of such specific date);




(ii) all obligations, covenants and agreements of the Company required to be
performed at or prior to the Closing Date with respect to the performance of this
Agreement and matters contemplated hereby shall have been performed;




(iii) the delivery by the Company of the items set forth in Section 2.2(a) of
this Agreement;




(iv) the Company shall have obtained all governmental, regulatory or third
party consents and approvals, if any, necessary for the sale of the Shares;




(v) no statute, rule, regulation, executive order, decree, ruling or injunction
shall have been enacted, entered, promulgated or endorsed by any court or
governmental authority of competent jurisdiction that prohibits the consummation of
any of the transactions contemplated by the Transaction Documents;




(vi) since the date of execution of this Agreement, no event or series of
events shall have occurred that resulted, or could reasonably be expected to result,
in a Material Adverse Effect; and




(vii) trading in the Common Stock shall not have been suspended by the
Commission or any Trading Market (except for any suspensions of trading of not more
than one trading day solely to permit dissemination of material information
regarding the Company) at any time since the date of execution of this Agreement,
and the Common Stock shall have been at all times since such date listed for trading
on a Trading Market.



ARTICLE III.




REPRESENTATIONS AND WARRANTIES




3.1 Representations and Warranties of the Company. Except as set forth under the
corresponding section of the disclosure schedules delivered to the Purchasers concurrently herewith
(the “Disclosure Schedules”), which Disclosure Schedules shall be deemed a part hereof, the
Company hereby makes the representations and warranties set forth below to each Purchaser:




(a) Subsidiaries. All of the direct and indirect Subsidiaries of the Company
are set forth on Schedule 3.1(a). The Company owns, directly or indirectly, all of
the capital stock or other equity interests of each Subsidiary free and clear of any Liens,
and all the issued and outstanding shares of capital stock of each Subsidiary are validly
issued and are fully paid, non-assessable and free of preemptive and similar rights to
subscribe for or purchase securities.




(b) Organization and Qualification. The Company and each of the Subsidiaries
is an entity duly incorporated or otherwise organized, validly existing and in good standing
under the laws of the jurisdiction of its incorporation or organization (as applicable),
with the requisite power and authority to own and use its properties and assets and to carry
on its business as currently conducted. Neither the Company nor any Subsidiary is in
violation or default of any of the provisions of its respective certificate or articles of
incorporation, bylaws or other organizational or charter documents. Each of the Company and
the Subsidiaries is duly qualified to conduct business and is in good standing as a foreign
corporation or other entity in each jurisdiction in which the nature of the business
conducted or property owned by it makes such qualification necessary, except where the
failure to be so qualified or in good standing, as the case may be, could not have or
reasonably be expected to result in (i) a material adverse effect on the legality, validity
or enforceability of any Transaction Document, (ii) a material adverse effect on the
business, properties, assets, operations, prospects, results of operations or financial
condition of the Company and the Subsidiaries, taken as a whole, or (iii) a material adverse
effect on the Company’s ability to perform in any material respect on a timely basis its
obligations under any Transaction Document (any of (i), (ii) or (iii), a “Material
Adverse Effect”) and no Proceeding has been instituted in any such jurisdiction
revoking, limiting or curtailing or seeking to revoke, limit or curtail such power and
authority or qualification.




(c) Authorization; Enforcement. The Company has the requisite corporate power
and authority to enter into and to consummate the transactions contemplated by each of the
Transaction Documents and otherwise to carry out its obligations hereunder and thereunder.
The execution and delivery of each of the Transaction Documents by the Company and the
consummation by it of the transactions contemplated hereby and thereby have been duly
authorized by all necessary action on the part of the Company and no further action is
required by the Company, its Board of Directors or its stockholders in connection therewith
other than in connection with the required approvals set forth on Schedule 3.1(c)
attached hereto. Each Transaction Document has been (or upon delivery will have been) duly
executed by the Company and, when delivered in accordance with the terms hereof and thereof,
will constitute the valid and binding obligation of the Company enforceable against the
Company in accordance with its terms except (i) as limited by general equitable principles
and applicable bankruptcy, insolvency, reorganization, moratorium and other laws of general
application affecting enforcement of creditors’ rights generally, (ii) as limited by laws
relating to the availability of specific performance, injunctive relief or other equitable
remedies and (iii) insofar as indemnification and contribution provisions may be limited by
applicable law and principles of public policy.




(d) No Conflicts. The execution, delivery and performance of the Transaction
Documents by the Company, the issuance and sale of the Shares and the consummation by the
Company of the other transactions contemplated hereby and thereby do not and will not (i)
conflict with or violate any provision of the Company’s or any Subsidiary’s certificate or
articles of incorporation, bylaws or other organizational or charter documents, or (ii)
conflict with, or constitute a default (or an event that with notice or lapse of time or
both would become a default) under, result in the creation of any Lien upon any of the
properties or assets of the Company or any Subsidiary, or give to others any rights of
termination, amendment, acceleration or cancellation (with or without notice, lapse of time
or both) of, any agreement, credit facility, debt or other instrument (evidencing a Company
or Subsidiary debt or otherwise) or other understanding to which the Company or any
Subsidiary is a party or by which any property or asset of the Company or any Subsidiary is
bound or affected, or (iii) subject to the Required Approvals, conflict with or result in a
violation of any law, rule, regulation, order, judgment, injunction, decree or other
restriction of any court or governmental authority to which the Company or a Subsidiary is
subject (including federal and state securities laws and regulations), or by which any
property or asset of the Company or a Subsidiary is bound or affected; except in the case of
each of clauses (ii) and (iii), such as could not, individually or in the aggregate, have or
reasonably be expected to result in a Material Adverse Effect.




(e) Filings, Consents and Approvals. The Company is not required to obtain any
consent, waiver, authorization or order of, give any notice to, or make any filing or
registration with, any court or other federal, state, local or other governmental authority
or other Person in connection with the execution, delivery and performance by the Company of
the Transaction Documents, other than (i) filings required pursuant to Section 4.4 of this
Agreement, (ii) the filing with the Commission of the Registration Statement, (iii)
application(s) to each applicable Trading Market for the listing of the Shares for trading
thereon in the time and manner required thereby, and (iv) the filing of Form D with the
Commission and such filings as are required to be made under applicable state securities
laws (collectively, the “Required Approvals”).




(f) Issuance of the Shares. The Shares are duly authorized and, when issued
and paid for in accordance with the applicable Transaction Documents, will be validly
issued, fully paid and nonassessable, free and clear of all Liens imposed by the Company
other than restrictions on transfer provided for in the Transaction Documents. The Company
has reserved from its authorized capital stock the Shares issuable pursuant to this
Agreement.




(g) Capitalization. The capitalization of the Company is as set forth on
Schedule 3.1(g). No Person has any right of first refusal, preemptive right, right
of participation, or any similar right to participate in the transactions contemplated by
the Transaction Documents. Except as a result of the purchase and sale of the Shares or as
set forth on Schedule 3.1(g): (i) there are no outstanding options, warrants, script
rights to subscribe to, calls or commitments of any character whatsoever relating to, or
securities, rights or obligations convertible into or exercisable or exchangeable for, or
giving any Person any right to subscribe for or acquire, any shares of Common Stock, or
contracts, commitments, understandings or arrangements by which the Company or any
Subsidiary is or may become bound to issue additional shares of Common Stock or Common Stock
Equivalents; (ii) there are no outstanding debt securities, notes, credit agreements, credit
facilities or other agreements, documents or instruments evidencing Indebtedness of the
Company or any of its Subsidiaries or by which the Company or any of its Subsidiaries is or
may become bound; (iii) there are no loans or obligations of the Company or any of its
Subsidiaries to officers, directors, stockholders or employees of the Company or any of its
Subsidiaries other than for payment of salary for services rendered and for bonus payments,
reimbursement for reasonable expenses incurred on behalf of the Company or for other
standard employee benefits made generally available to all employees; (iv) there are no
financing statements securing obligations in any material amounts, either singly or in the
aggregate, filed in connection with the Company or any of its Subsidiaries; (v) there are no
outstanding shares or instruments of the Company or any of its Subsidiaries which contain
any redemption or similar provisions, and there are no contracts, commitments,
understandings or arrangements by which the Company or any of its Subsidiaries is or may
become bound to redeem a security of the Company or any of its Subsidiaries. The issuance
and sale of the Shares will not obligate the Company to issue shares of Common Stock or
other securities to any Person (other than the Purchasers) and will not result in a right of
any holder of Company securities to adjust the exercise, conversion, exchange or reset price
under any of such securities. All of the outstanding shares of capital stock of the Company
are validly issued, fully paid and nonassessable, have been issued in compliance with all
federal and state securities laws, and none of such outstanding shares was issued in
violation of any preemptive rights or similar rights to subscribe for or purchase
securities. Except as set forth on Schedule 3.1(g), there are no stockholders
agreements, voting agreements or other similar agreements with respect to the Company’s
capital stock to which the Company is a party or, to the knowledge of the Company, between
or among any of the Company’s stockholders.




(h) SEC Reports; Financial Statements. The Company has filed all reports,
schedules, forms, statements and other documents required to be filed by it under the
Securities Act and the Exchange Act, including pursuant to Section 13(a) or 15(d) thereof,
for the period commencing on January 1, 2006 through the date hereof (the foregoing
materials, including the exhibits thereto and documents incorporated by reference therein,
being collectively referred to herein as the “SEC Reports”) on a timely basis or has
received a valid extension of such time of filing and has filed any such SEC Reports prior
to the expiration of any such extension. As of their respective dates, the SEC Reports
complied in all material respects with the requirements of the Securities Act and the
Exchange Act and the rules and regulations of the Commission promulgated thereunder, as
applicable, and none of the SEC Reports, when filed, contained any untrue statement of a
material fact or omitted to state a material fact required to be stated therein or necessary
in order to make the statements therein, in the light of the circumstances under which they
were made, not misleading. The financial statements of the Company included in the SEC
Reports complied in all material respects with applicable accounting requirements and the
rules and regulations of the Commission with respect thereto as in effect at the time of
filing. Such financial statements have been prepared in accordance with United States
generally accepted accounting principles applied on a consistent basis during the periods
involved (“GAAP”), except as may be otherwise specified in such financial statements
or the notes thereto and except that unaudited financial statements may not contain all
footnotes required by GAAP, and fairly present in all material respects the financial
position of the Company and its consolidated subsidiaries as of and for the dates thereof
and the results of operations and cash flows for the periods then ended, subject, in the
case of unaudited statements, to normal, immaterial, year-end audit adjustments.




(i) Material Changes; Undisclosed Events, Liabilities or Developments. Since
the date of the latest audited financial statements included within the SEC Reports, except
as specifically disclosed in a subsequent SEC Report, (i) there has been no event,
occurrence or development that has had or that could reasonably be expected by the Company
to result in a Material Adverse Effect, (ii) the Company has not incurred any liabilities
(contingent or otherwise) other than (A) trade payables and accrued expenses incurred in the
ordinary course of business consistent with past practice and (B) liabilities not required
to be reflected in the Company’s financial statements pursuant to GAAP or disclosed in
filings made with the Commission, (iii) the Company has not altered its method of
accounting, (iv) the Company has not declared or made any dividend or distribution of cash
or other property to its stockholders or purchased, redeemed or made any agreements to
purchase or redeem any shares of its capital stock and (v) the Company has not issued any
equity securities to any officer, director or Affiliate, except pursuant to existing Company
stock option plans. The Company does not have pending before the Commission any request for
confidential treatment of information.




(j) Litigation. There is no action, suit, inquiry, notice of violation,
proceeding or investigation pending or, to the knowledge of the Company, threatened against
or affecting the Company, any Subsidiary or any of their respective properties before or by
any court, arbitrator, governmental or administrative agency or regulatory authority
(federal, state, county, local or foreign) (collectively, an “Action”) which
materially adversely affects or challenges the legality, validity or enforceability of any
of the Transaction Documents or the Shares. The Commission has not issued any stop order or
other order suspending the effectiveness of any registration statement filed by the Company
or any Subsidiary under the Exchange Act or the Securities Act.




(k) Labor Relations. No material labor dispute exists or, to the knowledge of
the Company, is imminent with respect to any of the employees of the Company which could
reasonably be expected to result in a Material Adverse Effect. None of the Company’s or its
Subsidiaries’ employees is a member of a union that relates to such employee’s relationship
with the Company, and neither the Company or any of its Subsidiaries is a party to a
collective bargaining agreement, and the Company and its Subsidiaries believe that their
relationships with their employees are good. No executive officer, to the knowledge of the
Company, is, or is now expected to be, in violation of any material term of any employment
contract, confidentiality, disclosure or proprietary information agreement or
non-competition agreement, or any other contract or agreement or any restrictive covenant,
and the continued employment of each such executive officer does not subject the Company or
any of its Subsidiaries to any liability with respect to any of the foregoing matters. The
Company and its Subsidiaries are in compliance with all U.S. federal, state, local and
foreign laws and regulations relating to employment and employment practices, terms and
conditions of employment and wages and hours, except where the failure to be in compliance
could not, individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect.




(l) Compliance. Neither the Company nor any Subsidiary (i) is in default under
or in violation of (and no event has occurred that has not been waived that, with notice or
lapse of time or both, would result in a default by the Company or any Subsidiary under),
nor has the Company or any Subsidiary received notice of a claim that it is in default under
or that it is in violation of, any indenture, loan or credit agreement or any other
agreement or instrument to which it is a party or by which it or any of its properties is
bound (whether or not such default or violation has been waived), (ii) is in violation of
any order of any court, arbitrator or governmental body, or (iii) is or has been in
violation of any statute, rule or regulation of any governmental authority, including
without limitation all foreign, federal, state and local laws applicable to its business and
all such laws that affect the environment, except in each case as could not have or
reasonably be expected to result in a Material Adverse Effect.




(m) Regulatory Permits. The Company and the Subsidiaries possess all
certificates, authorizations and permits issued by the appropriate federal, state, local or
foreign regulatory authorities necessary to conduct their respective businesses as described
in the SEC Reports, except where the failure to possess such permits could not have or
reasonably be expected to result in a Material Adverse Effect (“Material Permits”),
and neither the Company nor any Subsidiary has received any notice of proceedings relating
to the revocation or modification of any Material Permit.




(n) Title to Assets. The Company and the Subsidiaries have good and marketable
title in fee simple to all real property owned by them that is material to the business of
the Company and the Subsidiaries and good and marketable title in all personal property
owned by them that is material to the business of the Company and the Subsidiaries, in each
case free and clear of all Liens, except for Liens as do not materially affect the value of
such property and do not materially interfere with the use made and proposed to be made of
such property by the Company and the Subsidiaries and Liens for the payment of federal,
state or other taxes, the payment of which is neither delinquent nor subject to penalties.
Any real property and facilities held under lease by the Company and the Subsidiaries are
held by them under valid, subsisting and enforceable leases with which the Company and the
Subsidiaries are in compliance.




(o) Patents and Trademarks.




(i) The Company or its Subsidiaries have exclusive ownership or a valid license
to use all patent, copyright, trade secret, trademark or other proprietary rights
that are used in the business of the Company as presently conducted and are material
to the Company and its Subsidiaries taken as a whole (collectively,
“Intellectual Property”). All of such material patents, registered
trademarks and registered copyrights have been duly registered in, filed in or
issued by the United States Patent and Trademark Office, the United States Register
of Copyrights or the corresponding offices of other jurisdictions and, to the
knowledge of the Company, have been maintained and renewed in accordance with all
applicable provisions of law and administrative regulations in the United States and
all such jurisdictions.




(ii) All material licenses or other material agreements under which (A) the
Company or any Subsidiary is granted rights in Intellectual Property and (B) the
Company or any Subsidiary has granted rights to others in Intellectual Property
owned or licensed by the Company or any Subsidiary, are in full force and effect and
there is no material default by the Company or any Subsidiary thereto.




(iii) No proceedings have been instituted or are pending which challenge in a
material manner the rights of the Company or any Subsidiary in respect to the
Company or any Subsidiary’s right to the use of the Intellectual Property. The
Company and each Subsidiary has the right to use, free and clear of material claims
or rights of other persons, all of its customer lists, designs, computer software,
systems, data compilations, and other information that are required for its products
or its business as presently conducted.




(iv) The Company believes it and each Subsidiary has taken such reasonable
steps as are required in accordance with sound business practice and business
judgment to establish and preserve its ownership of all material copyright, trade
secret and other proprietary rights with respect to its products and technology.




(v) To the knowledge of the Company, the present business, activities and
products of the Company and each Subsidiary do not infringe any intellectual
property of any other person, except where such infringement would not have a
Material Adverse Effect. No material proceeding charging the Company or any
Subsidiary with infringement of any adversely held Intellectual Property has been
filed. The Company has not received or is otherwise aware of any infringement of or
conflict with asserted rights of others with respect to any Intellectual Property or
of any facts or circumstances which would render any Intellectual Property invalid
or inadequate to protect the interests of the Company or any Subsidiary, and which
infringement or conflict (if the subject of any unfavorable decision, ruling or
finding) or invalidity or inadequacy, singly or in the aggregate, would result in a
Material Adverse Effect. To the Company’s knowledge, there exists no third party
unexpired patent or patent application which includes claims that would be infringed
by the Company or otherwise have a Material Adverse Effect. To the knowledge of the
Company, the Company is not making unauthorized use of any material confidential
information or trade secrets of any third party. To the Company’s knowledge, the
activities of the Company or any Subsidiary or any employee on behalf of the Company
or any Subsidiary do not violate any material agreements or arrangements known to
the Company which any such employees have with other persons, if any.




(p) Insurance. The Company and the Subsidiaries are insured by insurers of
recognized financial responsibility against such losses and risks and in such amounts as are
prudent and customary in the businesses in which the Company and the Subsidiaries are
engaged, including, but not limited to, directors and officers insurance coverage at least
equal to the aggregate Subscription Amount. Neither the Company nor any Subsidiary has any
reason to believe that it will not be able to renew its existing insurance coverage as and
when such coverage expires or to obtain similar coverage from similar insurers as may be
necessary to continue its business without a significant increase in cost.




(q) Transactions With Affiliates and Employees. Except as set forth in the SEC
Reports, none of the officers or directors of the Company and, to the knowledge of the
Company, none of the employees of the Company is presently a party to any transaction with
the Company or any Subsidiary (other than for services as employees, officers and
directors), including any contract, agreement or other arrangement providing for the
furnishing of services to or by, providing for rental of real or personal property to or
from, or otherwise requiring payments to or from any 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 $60,000 other than (i) for payment of salary or consulting fees for
services rendered, (ii) reimbursement for expenses incurred on behalf of the Company and
(iii) for other employee benefits, including stock option agreements under any stock option
plan of the Company.




(r) Sarbanes-Oxley; Internal Accounting Controls. The Company is in material
compliance with all provisions of the Sarbanes-Oxley Act of 2002 which are applicable to it
as of the Closing Date. The Company maintains disclosure controls and procedures (as such
term is defined in Rule 13a-15(e) under the Exchange Act) that are effective in ensuring
that information required to be disclosed by the Company in the reports that it files or
submits under the Exchange Act is recorded, processed, summarized and reported, within the
time periods specified in the rules and forms of the SEC, including, without limitation,
controls and procedures designed in to ensure that information required to be disclosed by
the Company in the reports that it files or submits under the Exchange Act is accumulated
and communicated to the Company’s management, including its principal executive officer or
officers and its principal financial officer or officers, as appropriate, to allow timely
decisions regarding required disclosure. The Company and each of its Subsidiaries maintain
a system of internal accounting controls sufficient to provide reasonable assurance that (i)
transactions are executed in accordance with management’s general or specific
authorizations, (ii) transactions are recorded as necessary to permit preparation of
financial statements in conformity with generally accepted accounting principles and to
maintain asset and liability accountability, (iii) access to assets or incurrence of
liabilities is permitted only in accordance with management’s general or specific
authorization, and (iv) the recorded accountability for assets and liabilities is compared
with the existing assets and liabilities at reasonable intervals and appropriate action is
taken with respect to any difference. Except as set forth in the SEC Reports, during the 12
months prior to the date hereof neither the Company nor any of its Subsidiaries have
received any notice or correspondence from any accountant relating to any potential material
weakness in any part of the system of internal accounting controls of the Company or any of
its Subsidiaries.




(s) Certain Fees. Except for fees and expenses that may be payable to
ThinkEquity Partners, LLC, no brokerage or finder’s fees or commissions are or will be
payable by the Company to any broker, financial advisor or consultant, finder, placement
agent, investment banker, bank or other Person with respect to the transactions contemplated
by the Transaction Documents. The Purchasers shall have no obligation with respect to any
fees or with respect to any claims made by or on behalf of other Persons for fees of a type
contemplated in this Section that may be due in connection with the transactions
contemplated by the Transaction Documents as a result of any action taken by the Company or
its Affiliates.




(t) Private Placement. Subject to the accuracy of the Purchasers
representations and warranties set forth in Section 3.2, the offer and sale of the Shares by
the Company to the Purchasers as contemplated hereby constitute transactions exempt from the
registration requirements of Section 5 of the Securities Act. The issuance and sale of the
Shares hereunder does not contravene the rules and regulations of the Trading Market.




(u) Investment Company. The Company is not, and is not an Affiliate of, and
immediately after receipt of payment for the Shares, will not be or be an Affiliate of, an
“investment company” within the meaning of the Investment Company Act of 1940, as amended.
The Company shall conduct its business in a manner so that it will not become subject to the
Investment Company Act of 1940.




(v) Registration Rights. Other than each of the Purchasers and except as set
forth on Schedule 3.1(v), no Person has any right to cause the Company to effect the
registration under the Securities Act of any securities of the Company. The Company is
eligible for use of the Registration Statement on Form S-3 to register the Shares for resale
by the Purchasers.




(w) Listing and Maintenance Requirements. The Company’s Common Stock is
registered pursuant to Section 12(b) of the Exchange Act, and the Company has taken no
action designed to, or which to its knowledge is likely to have the effect of, terminating
the registration of the Common Stock under the Exchange Act nor has the Company received any
notification that the Commission is contemplating terminating such registration. The
Company has not, in the 12 months preceding the date hereof, received notice from any
Trading Market on which the Common Stock is or has been listed or quoted to the effect that
the Company is not in compliance with the listing or maintenance requirements of such
Trading Market. The Company is, and has no reason to believe that it will not in the
foreseeable future continue to be, in compliance with all such listing and maintenance
requirements.




(x) Disclosure. All disclosure furnished by or on behalf of the Company to the
Purchasers regarding the Company, its business and the transactions contemplated hereby,
including the Disclosure Schedules to this Agreement, with respect to the representations
and warranties made herein are true and correct with respect to such representations and
warranties and do not contain any untrue statement of a material fact or omit to state any
material fact necessary in order to make the statements made therein, in light of the
circumstances under which they were made, not misleading.




(y) No Integrated Offering. Assuming the accuracy of the Purchasers’
representations and warranties set forth in Section 3.2, 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 this offering of the Shares to be integrated with prior
offerings by the Company for purposes of the Securities Act or any applicable shareholder
approval provisions of any Trading Market on which any of the securities of the Company are
listed or designated. 




(z) Tax Status. Except for matters that would not, individually or in the
aggregate, have or reasonably be expected to result in a Material Adverse Effect, the
Company and each Subsidiary has filed all necessary federal, state and foreign income and
franchise tax returns and has paid or accrued all taxes shown as due thereon, and the
Company has no knowledge of a tax deficiency which has been asserted or threatened against
the Company or any Subsidiary.




(aa) No General Solicitation. Neither the Company nor any person acting on
behalf of the Company has offered or sold any of the Shares by any form of general
solicitation or general advertising. The Company has offered the Shares for sale only to
the Purchasers and certain other “accredited investors” within the meaning of Rule 501 under
the Securities Act.




(bb) Insolvency. The Company is not as of the date hereof, and after giving
effect to the transactions contemplated hereby to occur at the Closing, will not be
Insolvent (as defined below). For purposes of this Section 3.1(cc), “Insolvent”
means, with respect to any Person , (i) the present fair saleable value of such Person’s
assets is less than the amount required to pay such Person’s total indebtedness, (ii) such
Person is unable to pay its debts and liabilities, subordinated, contingent or otherwise, as
such debts and liabilities become absolute and matured, (iii) such Person intends to incur
or believes that it will incur debts that would be beyond its ability to pay as such debts
mature or (iv) such Person has unreasonably small capital with which to conduct the business
in which it is engaged as such business is now conducted and is proposed to be conducted.




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




(dd) No Undisclosed Events, Liabilities, Developments or Circumstances. Except
for the transactions contemplated by this Agreement, no event, liability, development or
circumstance has occurred or exists with respect to the Company or its business, properties,
prospects, operations or financial condition, that is required to be, and has not been,
disclosed, by the Company under applicable securities laws on a Current Report on Form 8-K
filed with the SEC.




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




(ff) PFIC. Neither the Company nor any Subsidiary is or intends to become a
“passive foreign investment company” within the meaning of Section 1297 of the U.S. Internal
Revenue Code of 1986, as amended.




(gg) Manipulation of Price. The Company has not, and to its knowledge no one
acting on its behalf has taken, directly or indirectly, any action designed to cause or to
result in the stabilization or manipulation of the price of any security of the Company to
facilitate the sale or resale of any of the Shares.




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




(ii) OFAC. Neither the Company nor any Subsidiary nor, to the knowledge of the
Company, any director, officer, agent, employee, Affiliate or Person acting on behalf of the
Company or any Subsidiary is currently subject to any U.S. sanctions administered by the
Office of Foreign Assets Control of the U.S. Treasury Department (“OFAC”); and the
Company will not directly or indirectly use the proceeds of the sale of the Shares, or lend,
contribute or otherwise make available such proceeds to any Subsidiary, joint venture
partner or other Person or entity, towards any sales or operations in Cuba, Iran, Syria,
Sudan, Myanmar or any other country sanctioned by OFAC or for the purpose of financing the
activities of any Person currently subject to any U.S. sanctions administered by OFAC.




(jj) Money Laundering Laws. The operations of each of the Company and any
Subsidiary are and have been conducted at all times in compliance with the money laundering
statutes of applicable jurisdictions, the rules and regulations thereunder and any related
or similar rules, regulations or guidelines, issued, administered or enforced by any
applicable governmental agency (collectively, the “Money Laundering Laws”), and no action,
suit or proceeding by or before any court or governmental agency, authority or body or any
arbitrator involving the Company and/or any Subsidiary with respect to the Money Laundering
Laws is pending or, to the Company’s knowledge, threatened.




(kk) Material, Non-Public Information. The Company confirms that neither it
nor, to its knowledge, any of its officers or directors nor any other Person acting on its
or their behalf has provided, and it has not authorized the Placement Agent to provide, any
Purchaser or its respective agents or counsel with any information that it believes
constitutes or could reasonably be expected to constitute material, non-public information
except insofar as the existence, provisions and terms of the Transaction Documents and the
proposed transactions hereunder may constitute such information, all of which will be
disclosed by the Company in the press release and Current Report on Form 8-K as contemplated
by Section 4.4 hereof. The Company understands and confirms that the Purchasers will rely on
the foregoing representations in effecting transactions in securities of the Company. No
event or circumstance has occurred or information exists with respect to the Company or any
of its Subsidiaries or its or their business, properties, operations or financial
conditions, which, under applicable law, rule or regulation, requires public disclosure or
announcement by the Company but which has not been so publicly announced or disclosed
(assuming for this purpose that the Company’s reports filed under the Exchange Act are being
incorporated into an effective registration statement filed by the Company under the
Securities Act), except for the announcement of this Agreement and related transactions.




(ll) Acknowledgment Regarding Purchasers’ Purchase of Securities. The Company
acknowledges and agrees that each of the Purchasers is acting solely in the capacity of an
arm’s length purchaser with respect to the Transaction Documents and the transactions
contemplated hereby and thereby. The Company further acknowledges that no Purchaser is
acting as a financial advisor or fiduciary of the Company (or in any similar capacity) with
respect to the Transaction Documents and the transactions contemplated thereby and any
advice given by any Purchaser or any of their respective representatives or agents in
connection with the Transaction Documents and the transactions contemplated thereby is
merely incidental to the Purchasers’ purchase of the Shares.




(mm) No Additional Agreements. The Company does not have any agreement or
understanding with any Purchaser with respect to the transactions contemplated by the
Transaction Documents other than as specified in the Transaction Documents.



3.2 Representations and Warranties of the Purchasers. Each Purchaser hereby, for
itself and for no other Purchaser, represents and warrants as of the date hereof and as of the
Closing Date to the Company as follows:




(a) Organization; Authority. Such Purchaser is an entity duly organized,
validly existing and in good standing under the laws of the jurisdiction of its organization
with full right, corporate or partnership power and authority to enter into and to
consummate the transactions contemplated by the Transaction Documents and otherwise to carry
out its obligations hereunder and thereunder. The execution, delivery and performance by
such Purchaser of the transactions contemplated by this Agreement have been duly authorized
by all necessary corporate or similar action on the part of such Purchaser. Each
Transaction Document to which it is a party has been duly executed by such Purchaser, and
when delivered by such Purchaser in accordance with the terms hereof, will constitute the
valid and legally binding obligation of such Purchaser, enforceable against it in accordance
with its terms, except (i) as limited by general equitable principles and applicable
bankruptcy, insolvency, reorganization, moratorium and other laws of general application
affecting enforcement of creditors’ rights generally, (ii) as limited by laws relating to
the availability of specific performance, injunctive relief or other equitable remedies and
(iii) insofar as indemnification and contribution provisions may be limited by applicable
law.




(b) Own Account. Such Purchaser understands that the Shares are “restricted
securities” and have not been registered under the Securities Act or any applicable state
securities law and is acquiring the Shares as principal for its own account and not with a
view to or for distributing or reselling such Shares or any part thereof in violation of the
Securities Act or any applicable state securities law, has no present intention of
distributing any of such Shares in violation of the Securities Act or any applicable state
securities law and has no direct or indirect arrangement or understandings with any other
persons to distribute or regarding the distribution of such Shares (this representation and
warranty not limiting such Purchaser’s right to sell the Shares pursuant to the Registration
Statement or otherwise in compliance with applicable federal and state securities laws) in
violation of the Securities Act or any applicable state securities law. Such Purchaser is
acquiring the Shares hereunder in the ordinary course of its business.




(c) Purchaser Status. At the time such Purchaser was offered the Shares, it
was, and at the date hereof it is, an “accredited investor” as defined in Rule 501(a)(1),
(a)(2), (a)(3), (a)(7) or (a)(8) under the Securities Act. Such Purchaser is not required
to be registered as a broker-dealer under Section 15 of the Exchange Act.




(d) Experience of Such Purchaser. Such Purchaser, either alone or together
with its representatives, has such knowledge, sophistication and experience in business and
financial matters so as to be capable of evaluating the merits and risks of the prospective
investment in the Shares, and has so evaluated the merits and risks of such investment.
Such Purchaser is able to bear the economic risk of an investment in the Shares and, at the
present time, is able to afford a complete loss of such investment.




(e) General Solicitation. Such Purchaser is not purchasing the Shares as a
result of any advertisement, article, notice or other communication regarding the Shares
published in any newspaper, magazine or similar media or broadcast over television or radio
or presented at any seminar or any other general solicitation or general advertisement.




(f) Short Sales and Confidentiality Prior To The Date Hereof. Other than the
purchases and sales of securities contemplated hereunder, such Purchaser has not directly or
indirectly, nor has any Person acting on behalf of or pursuant to any understanding with
such Purchaser, engaged in any transaction, including Short Sales, in the securities of the
Company since the earlier to occur of (i) the time that such Purchaser was first contacted
by the Company regarding an investment in the Company, or (ii) the 10th day prior
to the date of this Agreement (such earlier date, “Discussion Time”).
Notwithstanding the foregoing, in the case of a Purchaser that is a multi-managed investment
vehicle whereby separate portfolio managers manage separate portions of such Purchaser’s
assets and the portfolio managers have no direct knowledge of the investment decisions made
by the portfolio managers managing other portions of such Purchaser’s assets, the
representation set forth above shall only apply with respect to the portion of assets
managed by the portfolio manager that made the investment decision to purchase the Shares
covered by this Agreement. Other than to other Persons party to this Agreement, such
Purchaser has maintained the confidentiality of all disclosures made to it in connection
with this transaction (including the existence and terms of this transaction).




(g) Access to Information. Such Purchaser acknowledges that it has received
and had the opportunity to review (i) copies of the SEC Reports, and (ii) all exhibits
thereto. Such Purchaser further acknowledges that it or its representatives have been
afforded (iii) the opportunity to ask such questions as it has deemed necessary of, and to
receive answers from, representatives of the Company concerning the terms and conditions of
the offering of the Shares, the merits and risks of investing in the Shares, (iv) access to
information about the Company and the Company’s financial condition, results of operations,
business, properties, management and prospects sufficient to enable it to evaluate its
investment in the Shares; and (v) the opportunity to obtain such additional information
which the Company possesses or can acquire without unreasonable effort or expense that is
necessary to verify the accuracy and completeness of the information contained in the SEC
Reports.




(h) Restrictions on Shares. Such Purchaser understands that the Shares have
not been registered under the Securities Act and may not be offered, resold, or otherwise
transferred except (a) pursuant to an exemption from registration under the Securities Act
or pursuant to an effective registration statement in compliance with Section 5 under the
Securities Act and (b) in accordance with all applicable securities laws of the states of
the United States and other jurisdictions.



ARTICLE IV.




OTHER AGREEMENTS OF THE PARTIES




4.1 Transfer Restrictions.




(a) The Shares may only be disposed of in compliance with state and federal securities
laws. In connection with any transfer of Shares other than pursuant to an effective
registration statement or Rule 144, the Company may require the transferor thereof to
provide to the Company an opinion of counsel, the form and substance of which opinion shall
be reasonably satisfactory to the Company, to the effect that such transfer does not require
registration of such transferred Shares under the Securities Act.




(b) The Purchasers agree to the imprinting, so long as is required by this Section
4.1(b), of a legend on any of the Shares in the following form:




THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS
AMENDED, OR THE SECURITIES LAWS OF ANY STATE AND ARE “RESTRICTED SECURITIES” AS THAT
TERM IS DEFINED IN RULE 144 UNDER THE SECURITIES ACT. SUCH SECURITIES MAY NOT BE
OFFERED FOR SALE, SOLD, OR OTHERWISE TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND THE APPLICABLE STATE SECURITIES
LAWS OR PURSUANT TO AN EXEMPTION FROM REGISTRATION THEREUNDER, THE AVAILABILITY OF
WHICH IS TO BE ESTABLISHED TO THE REASONABLE SATISFACTION OF COUNSEL TO THE ISSUER.




(c) The Company acknowledges and agrees that a Purchaser may from time to time pledge,
and/or grant a security interest in some or all of the legended Shares, in connection with
applicable securities laws, pursuant to a bona fide margin agreement in compliance with a
bona fide margin loan. Such a pledge would not be subject to approval or consent of the
Company and no legal opinion of legal counsel to the pledgee, secured party, or pledgor
shall be required in connection with the pledge, but such legal opinion shall be required in
connection with a subsequent transfer or foreclosure following default by such Purchaser.
No notice shall be required of such pledge but the Purchaser shall promptly notify the
Company of any such subsequent transfer or foreclosure. Each Purchaser acknowledges that
the Company shall not be responsible for any pledges relating to, or the grant of any
security interest in, any of the Shares or for any agreement, understanding or arrangement
between any Purchaser and its pledgee or secured party. Each Purchaser acknowledges and
agrees that, except as otherwise provided in Section 4.1(d), any Shares subject to a pledge
or security interest as contemplated by this Section 4.1(b) shall continue to bear the
legend set forth in this Section 4.1(b) and be subject to the restrictions on transfer set
forth in Section 4.1(a).




(d) Subject to and in reliance upon compliance of the Purchasers with Sections 7(b) and
7(c) of the Registration Rights Agreement, certificates evidencing Shares shall not be
required to contain such legend (i) while a Registration Statement covering the resale of
such Shares is effective under the Securities Act, or (ii) following any sale of such Shares
pursuant to Rule 144, or (iii) if such Shares are eligible for sale under Rule 144(k), or
(iv) if such legend is not required under applicable requirements of the Securities Act
(including judicial interpretations and pronouncements issued by the Staff of the
Commission). Following the Effective Date or at such earlier time as a legend is no longer
required for certain Shares, the Company will no later than ten (10) calendar days following
the delivery by a Purchaser to the Company’s transfer agent (with notice to the Company) of
a legended certificate representing such Shares (endorsed or with stock powers attached,
signatures guaranteed, and otherwise in form necessary to effect the reissuance and/or
transfer and an opinion of counsel to the extent required by Section 4.1(a)), deliver or
cause to be delivered to such Purchaser a certificate representing such Shares that is free
from such restrictive legends.




(e) Each Purchaser hereunder acknowledges its primary responsibilities under the
Securities Act and accordingly covenants and agrees not to sell the Shares or any interest
therein without complying with the requirements of the Securities Act and any applicable
prospectus delivery requirements. While the above-referenced Registration Statement remains
effective, each Purchaser hereunder may sell the Shares in accordance with the plan of
distribution contained in the Registration Statement and if it does so it will comply
therewith and with the related prospectus delivery requirements unless an exemption
therefrom is available.




(f) If the Company shall fail for any reason or for no reason to issue to a Purchaser
unlegended certificates within three (3) Trading Days of receipt of all documents necessary
for the removal of the legend set forth in Section 4.1(d) above (the “Deadline
Date”), then, in addition to all other remedies available to such Purchaser, if on or
after the Trading Day immediately following such three-day period, such Purchaser sells
Shares in an open-market transaction which the Purchaser anticipated receiving from the
Company without any restrictive legend and is required to purchase shares of Common Stock to
deliver in satisfaction of the sale by the Purchaser (a “Buy-In”), then the Company
shall, within three (3) Trading Days after such Purchaser’s request and in such Purchaser’s
sole discretion, either (i) pay cash to the Purchaser in an amount equal to such Purchaser’s
total purchase price (including brokerage commissions, if any) for the shares of Common
Stock so purchased (the “Buy-In Price”), at which point the Company’s obligation to
deliver such certificate (and to issue such shares of Common Stock) shall terminate, or (ii)
promptly honor its obligation to deliver to such Purchaser a certificate or certificates
representing such shares of Common Stock and pay cash to the Purchaser in an amount equal to
the excess (if any) of the Buy-In Price over the product of (a) such number of shares of
Common Stock, times (b) the closing bid price on the Deadline Date.



4.2 Furnishing of Information. As long as any Purchaser owns Shares, the Company
covenants to timely file (or obtain extensions in respect thereof and file within the applicable
grace period) all reports required to be filed by the Company after the date hereof pursuant to the
Exchange Act. As long as any Purchaser owns Shares, if the Company is not required to file reports
pursuant to the Exchange Act, it will prepare and furnish to the Purchasers and make publicly
available in accordance with Rule 144(c) such information as is required for the Purchasers to sell
the Shares under Rule 144. The Company further covenants that it will take such further action as
any holder of Shares may reasonably request, to the extent required from time to time to enable
such Person to sell such Shares without registration under the Securities Act within the
requirements of the exemption provided by Rule 144.



4.3 Integration. The Company shall not sell, offer for sale or solicit offers to buy
or otherwise negotiate in respect of any security (as defined in Section 2 of the Securities Act)
that would be integrated with the offer or sale of the Shares in a manner that would require the
registration under the Securities Act of the sale of the Shares to the Purchasers or that would be
integrated with the offer or sale of the Shares for purposes of the rules and regulations of any
Trading Market such that it would require shareholder approval prior to the closing of such other
transaction unless shareholder approval is obtained before the closing of such subsequent
transaction.



4.4 Securities Laws Disclosure; Publicity. The Company shall, by 9:00 am (New York
City time) on the Business Day immediately following the date of this Agreement issue a press
release reasonably acceptable to Strata Capital Management disclosing all material terms of the
transactions contemplated hereby, and shall file a Current Report on Form 8-K (the “Closing
8-K”) attaching the Transaction Documents thereto by the end of such Business Day. No
Purchaser shall issue any such press release or otherwise make any such public statement without
the prior consent of the Company. The Company shall not publicly disclose the name of any
Purchaser, or include the name of any Purchaser in any filing with the Commission or any regulatory
agency or Trading Market, without the prior written consent of such Purchaser, except (i) as
required by federal securities law in connection with (A) any registration statement contemplated
by the Registration Rights Agreement and (B) the filing of final Transaction Documents (including
signature pages thereto) with the Commission and (ii) to the extent such disclosure is required by
law or Trading Market regulations, in which case the Company shall provide the Purchasers with
prior notice of such disclosure permitted under this subclause (ii).



4.5 Use of Proceeds. The Company shall use the net proceeds from the sale of the
Shares for general corporate purposes, including general and administrative expenses, and, except
as set forth on Schedule 4.5, not for (i) the repayment of any outstanding Indebtedness of
the Company or any of its Subsidiaries, or (ii) the redemption or repurchase of any of its or its
Subsidiaries’ equity securities.



4.6 Listing of Common Stock. The Company hereby agrees to use its best efforts to
maintain the listing of the Common Stock on a Trading Market, and as soon as reasonably practicable
following the Closing to list all of the Shares on such Trading Market. The Company further agrees,
if the Company applies to have the Common Stock traded on any other Trading Market, it will include
in such application all of the Shares, and will take such other action as is necessary to cause all
of the Shares to be listed on such other Trading Market as promptly as possible. The Company will
take all action reasonably necessary to continue the listing and trading of its Common Stock on a
Trading Market and will comply in all respects with the Company’s reporting, filing and other
obligations under the bylaws or rules of the Trading Market.



4.7 Short Sales and Confidentiality After The Date Hereof. Each Purchaser, severally
and not jointly with the other Purchasers, covenants that neither it nor any Affiliate acting on
its behalf or pursuant to any understanding with it will engage in any purchases or sales of,
including any Short Sales, the securities of the Company during the period commencing at the
Discussion Time and ending twenty-four (24) hours after the time that the transactions contemplated
by this Agreement are first publicly announced by dissemination of the press release as described
in Section 4.4 (“Black-out Termination Date”). Each Purchaser, severally and not jointly
with the other Purchasers, covenants that until the Black-out Termination Date, such Purchaser will
maintain the confidentiality of all disclosures made to it in connection with this transaction
(including the existence and terms of this transaction). Each Purchaser understands and
acknowledges, severally and not jointly with any other Purchaser, that the Commission currently
takes the position that coverage of short sales of shares of the Common Stock “against the box”
prior to the Effective Date of the Registration Statement with respect to the Shares is a violation
of Section 5 of the Securities Act, as set forth in Item 65, Section A, of the Manual of Publicly
Available Telephone Interpretations, dated July 1997, compiled by the Office of Chief Counsel,
Division of Corporation Finance. Notwithstanding the foregoing, no Purchaser makes any
representation, warranty or covenant hereby that it will not engage in Short Sales in the
securities of the Company after the Black-out Termination Date. Notwithstanding the foregoing, in
the case of a Purchaser that is a multi-managed investment vehicle whereby separate portfolio
managers manage separate portions of such Purchaser’s assets and the portfolio managers have no
direct knowledge of the investment decisions made by the portfolio managers managing other portions
of such Purchaser’s assets, the covenant set forth above shall only apply with respect to the
portion of assets managed by the portfolio manager that made the investment decision to purchase
the Shares covered by this Agreement.



4.8 Form D; Blue Sky Filings. The Company agrees to timely file a Form D with respect
to the Shares as required under Regulation D and to provide a copy thereof to each Purchaser. The
Company shall take such action as the Company shall reasonably determine is necessary in order to
obtain an exemption for, or to qualify the Shares for, sale to the Purchasers at the Closing under
applicable securities or “Blue Sky” laws of the states of the United States, and shall provide
evidence of such actions promptly upon request of any Purchaser.



4.9 Indemnification of Purchasers. In addition to the indemnity provided in the
Registration Rights Agreement, the Company will indemnify and hold the Purchasers and their
directors, officers, shareholders, partners, employees and agents (each, a “Purchaser
Party”) harmless from any and all losses, liabilities, obligations, claims, contingencies,
damages, costs and expenses, including all judgments, amounts paid in settlements, court costs and
reasonable attorneys’ fees and costs of investigation (collectively, “Losses”) that any
such Purchaser Party may suffer or incur as a result of or relating to: (a) any misrepresentation,
breach or inaccuracy of any representation, warranty, covenant or agreement made by the Company in
any Transaction Document; or (b) any cause of action, suit, or claim brought or made against such
Purchaser Party and arising solely out of or solely resulting from the execution, delivery,
performance or enforcement of this Agreement or any of the other Transaction Documents and without
causation by other activity, obligation, condition or liability pertaining to such Purchaser;
provided, however, the Company will not be liable for (i) special damages or (ii)
Losses that arise out of a Purchaser’s violation of law, or misrepresentation, breach or inaccuracy
of any representation, warranty, covenant or agreement made by Purchaser in any Transaction
Document; and provided further, the indemnity agreement contained herein shall not
apply to amounts paid in settlement of any such Loss if such settlement is effected without the
consent of the Company (which consent shall not be unreasonably withheld). In addition to the
indemnity contained herein, the Company will reimburse each Purchaser Party for its reasonable
legal and other expenses (including the cost of any investigation, preparation and travel in
connection therewith) incurred in connection therewith, as such expenses are incurred.



ARTICLE V.




MISCELLANEOUS




5.1 Termination.  This Agreement may be terminated by any Purchaser, as to such
Purchaser’s obligations hereunder only and without any effect whatsoever on the obligations between
the Company and the other Purchasers, or the Company by written notice to the other parties, if the
Closing has not been consummated on or before October 26, 2007, provided, however,
that no such termination will affect the right of any party to sue for any breach by the other
party (or parties).



5.2 Fees and Expenses. Except as expressly set forth in the Transaction Documents to
the contrary, each party shall pay the fees and expenses of its advisers, counsel, accountants and
other experts, if any, and all other expenses incurred by such party incident to the negotiation,
preparation, execution, delivery and performance of this Agreement. The Company shall pay all
transfer agent fees, stamp taxes, transfer taxes and other taxes and duties levied in connection
with the delivery of any Shares to the Purchasers. The Company shall pay all expenses reasonably
incurred by Purchasers in connection with the negotiation, drafting, and execution of the
Transaction Documents, including, without limitation, attorneys’ fees and disbursements, in an
aggregate amount not greater than Fifty Thousand Dollars ($50,000).



5.3 Remedies. In addition to being entitled to exercise all rights provided herein or
granted by law, including recovery of damages, each of the Purchasers and the Company will be
entitled to specific performance under the Transaction Documents. The parties agree that monetary
damages may not be adequate compensation for any loss incurred by reason of any breach of
obligations described in the foregoing sentence and hereby agree to waive in any action for
specific performance of any such obligation (other than in connection with any action for a
temporary restraining order) the defense that a remedy at law would be adequate.



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



5.5 Independent Nature of Purchasers’ Obligations and Rights. The obligations of each
Purchaser under any Transaction Document are several and not joint with the obligations of any
other Purchaser, and no Purchaser shall be responsible in any way for the performance of the
obligations of any other Purchaser under any Transaction Document. The decision of each Purchaser
to purchase Shares pursuant to the Transaction Documents has been made by such Purchaser
independently of any other Purchaser and independently of any information, materials, statements or
opinions as to the business, affairs, operations, assets, properties, liabilities, results of
operations, condition (financial or otherwise) or prospects of the Company or any Subsidiary which
may have been made or given by any other Purchaser or by any agent or employee of any other
Purchaser, and no Purchaser and any of its agents or employees shall have any liability to any
other Purchaser (or any other Person) relating to or arising from any such information, materials,
statement or opinions. Nothing contained herein or in any Transaction Document, and no action
taken by any Purchaser pursuant thereto, shall be deemed to constitute the Purchasers as a
partnership, an association, a joint venture or any other kind of entity, or create a presumption
that the Purchasers are in any way acting in concert or as a group with respect to such obligations
or the transactions contemplated by the Transaction Documents. Each Purchaser acknowledges that no
other Purchaser has acted as agent for such Purchaser in connection with making its investment
hereunder and that no Purchaser will be acting as agent of such Purchaser in connection with
monitoring its investment in the Shares or enforcing its rights under the Transaction Documents.
Each Purchaser shall be entitled to independently protect and enforce its rights, including without
limitation the rights arising out of this Agreement or out of the other Transaction Documents, and
it shall not be necessary for any other Purchaser to be joined as an additional party in any
proceeding for such purpose. The Company acknowledges that each of the Purchasers has been
provided with the same Transaction Documents for the purpose of closing a transaction with multiple
Purchasers and not because it was required or requested to do so by any Purchaser. The Company’s
obligations to each Purchaser under this Agreement are identical to its obligations to each other
Purchaser other than such differences resulting solely from the number of Shares purchased by such
Purchaser, but regardless of whether such obligations are memorialized herein or in another
agreement between the Company and a Purchaser.



5.6 Entire Agreement. The Transaction Documents, together with the exhibits and
schedules thereto, contain the entire understanding of the parties with respect to the subject
matter hereof and supersede all prior agreements and understandings, oral or written, with respect
to such matters, which the parties acknowledge have been merged into such documents, exhibits and
schedules.



5.7 Notices. Any and all notices or other communications or deliveries required or
permitted to be provided hereunder shall be in writing and shall be deemed given and effective on
the earliest of (a) the date of transmission, if such notice or communication is delivered via
facsimile at the facsimile number set forth on the signature pages attached hereto prior to
3:30 p.m. (Las Vegas time) on a Business Day, (b) the next Business Day after the date of
transmission, if such notice or communication is delivered via facsimile at the facsimile number
set forth on the signature pages attached hereto on a day that is not a Business Day or later than
3:30 p.m. (Las Vegas time) on any Business Day, (c) the 2nd Business Day following the
date of mailing, if sent by U.S. nationally recognized overnight courier service, or (d) upon
actual receipt by the party to whom such notice is required to be given. The address for such
notices and communications shall be as set forth on the signature pages attached hereto.



5.8 Amendments; Waivers. No provision of this Agreement may be amended or waived
except in a written instrument signed by the Company and the Purchasers holding not less than 85%
of the Shares; provided, however, that if any amendment or waiver operates in a
manner that treats any Purchaser differently from the other Purchasers, the consent of such
Purchaser shall also be required for such amendment or waiver. No waiver of any default with
respect to any provision, condition or requirement of this Agreement shall be deemed to be a
continuing waiver in the future or a waiver of any subsequent default or a waiver of any other
provision, condition or requirement hereof, nor shall any delay or omission of any party to
exercise any right hereunder in any manner impair the exercise of any such right.



5.9 Headings. The headings herein are for convenience only, do not constitute a part
of this Agreement and shall not be deemed to limit or affect any of the provisions hereof.



5.10 Successors and Assigns. This Agreement, and any and all rights, duties and
obligations hereunder, shall not be assigned, transferred, delegated or sublicensed by the Company
without the prior written consent of each Purchaser. Subject to the foregoing and except as
otherwise provided herein, the provisions of this Agreement shall inure to the benefit of, and be
binding upon, the successors, assigns, heirs, executors and administrators of the parties hereto.



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



5.12 Governing Law. All questions concerning the construction, validity, enforcement
and interpretation of the Transaction Documents shall be governed by and construed and enforced in
accordance with the internal laws of the State of New York, without regard to the principles of
conflicts of law thereof. Each party agrees that all legal proceedings concerning the
interpretations, enforcement and defense of the transactions contemplated by this Agreement and any
other Transaction Documents (whether brought against a party hereto or its respective affiliates,
directors, officers, shareholders, employees or agents) shall be commenced exclusively in the state
and federal courts sitting in the State of New York. Each party hereby irrevocably submits to the
exclusive jurisdiction of the state and federal courts sitting in the State of New York, for the
adjudication of any dispute hereunder or in connection herewith or with any transaction
contemplated hereby or discussed herein, and hereby irrevocably waives, and agrees not to assert in
any suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of
any such court, that such suit, action or proceeding is brought in an inconvenient forum or that
the venue of such suit, action or proceeding is improper. Nothing contained herein shall be deemed
to limit in any way any right to serve process in any manner permitted by law. Each party hereby
irrevocably waives any right it may have, and agrees not to request, a jury trial for the
adjudication of any dispute hereunder or in connection with or arising out of this Agreement or any
transaction contemplated hereby. If either party shall commence an action or proceeding to enforce
any provisions of the Transaction Documents, then the prevailing party in such action or proceeding
shall be reimbursed by the other party for its reasonable attorneys’ fees and other costs and
expenses incurred with the investigation, preparation and prosecution of such action or proceeding.



5.13 Survival. The representations and warranties contained herein shall survive the
Closing and the delivery of the Shares. Each Purchaser shall be responsible only for its own
representations, warranties and covenants hereunder.



5.14 Execution. This Agreement may be executed in two or more counterparts, all of
which when taken together shall be considered one and the same agreement and shall become effective
when counterparts have been signed by each party and delivered to the other party, it being
understood that both parties need not sign the same counterpart. In the event that any signature
is delivered by facsimile transmission or by e-mail delivery of a “.pdf” format data file, such
signature shall create a valid and binding obligation of the party executing (or on whose behalf
such signature is executed) with the same force and effect as if such facsimile or “.pdf” signature
page were an original thereof.



5.15 Severability. If any term, provision, covenant or restriction of this Agreement
is held by a court of competent jurisdiction to be invalid, illegal, void or unenforceable, the
remainder of the terms, provisions, covenants and restrictions set forth herein shall remain in
full force and effect and shall in no way be affected, impaired or invalidated, and the parties
hereto shall use their commercially reasonable efforts to find and employ an alternative means to
achieve the same or substantially the same result as that contemplated by such term, provision,
covenant or restriction. It is hereby stipulated and declared to be the intention of the parties
that they would have executed the remaining terms, provisions, covenants and restrictions without
including any of such that may be hereafter declared invalid, illegal, void or unenforceable.



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



5.17 Replacement of Shares. If any certificate or instrument evidencing any Shares is
mutilated, lost, stolen or destroyed, the Company shall issue or cause to be issued in exchange and
substitution for and upon cancellation thereof (in the case of mutilation), or in lieu of and
substitution therefor, a new certificate or instrument, but only upon receipt of evidence
reasonably satisfactory to the Company of such loss, theft or destruction. The applicant for a new
certificate or instrument under such circumstances shall also pay any reasonable third-party costs
(including customary indemnity) associated with the issuance of such replacement Shares.



5.18 Construction. The parties agree that each of them and/or their respective counsel
has reviewed and had an opportunity to revise the Transaction Documents and, therefore, the normal
rule of construction to the effect that any ambiguities are to be resolved against the drafting
party shall not be employed in the interpretation of the Transaction Documents or any amendments
hereto.



5.19 Limitations of Liability. Notwithstanding anything herein to the contrary, the
Company acknowledges and agrees that the liability of a Purchaser arising directly or indirectly,
under any Transaction Document of any and every nature whatsoever shall be satisfied solely out of
the assets of such Purchaser, and that no trustee, officer, other investment vehicle or any other
Affiliate of such Investor or any investor, shareholder or holder of shares of beneficial interest
of such a Purchaser shall be personally liable for any liabilities of such Purchaser.



(Signature Pages Follow)




1




IN WITNESS WHEREOF, the parties hereto have caused this Securities Purchase Agreement
to be duly executed by their respective authorized signatories as of the date first indicated
above.



	 	 	 
	ELIXIR GAMING TECHNOLOGIES, INC.

	 	Address for Notice:
	
 
	 	 
	By:_/s/ David Reberger     




David Reberger,

Chief Financial Officer

	 	1120 Town Center

Suite 260

Las Vegas, NV 89144

Fax: 702.733.7197









2




[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK

SIGNATURE PAGE FOR PURCHASER FOLLOWS]




IN WITNESS WHEREOF, the parties hereto have caused this Securities Purchase Agreement to be
duly executed by their respective authorized signatories as of the date first indicated above.



	 	 	 	 	 
	PURCHASER	 	 	 	 
	Janus Adviser Fund on behalf of its series
Janus Adviser Series Small-Mid Growth Fund
	 	 	 	 
	 
	 	 	 	 
	Name of Purchaser
/s/ Stephanie Grauerholz-Lofton                               
	 	 	 	 
	 
	 	 	 	 
	Signature of Purchaser or by Authorized Person executing for
Purchaser
	 	Address for Notice:
	Printed Name: Stephanie Grauerholz-Lofton
	 	 	—	 
	Title: Vice President
	 	Janus Capital Management LLC
	Its:__________________________________________
	 	151 Detroit Street
	(Printed Name of Authorized Person and Title for Person
	 	Denver, CO  80206
	executing for Purchaser)
	 	Attn:  Angela Morton
	Subscription Amount: $44,358.00
Shares: 12,674
	 	with a copy to:
	 
	 	Address for Delivery of
	 
	 	Shares for Purchaser:
	 
	 	Snorklecove & Co.
	 
	 	151 Detroit St.
	 
	 	Denver, CO  80206
	 
	 	Attn:  Corie Carlson






3




IN WITNESS WHEREOF, the parties hereto have caused this Securities Purchase Agreement to be
duly executed by their respective authorized signatories as of the date first indicated above.



	 	 	 	 	 
	PURCHASER	 	 	 	 
	Janus Investment Fund on behalf of its series
Janus Triton Fund                                                           
	 	 	 	 
	 
	 	 	 	 
	Name of Purchaser
/s/ Stephanie Grauerholz-Lofton                               
	 	 	 	 
	 
	 	 	 	 
	Signature of Purchaser or by Authorized Person executing for Purchaser
	 	Address for Notice:
	Printed Name: Stephanie Grauerholz-Lofton
	 	 	—	 
	Title: Vice President
	 	Janus Capital Management LLC
	Its:__________________________________________
	 	151 Detroit Street
	(Printed Name of Authorized Person and Title for Person executing for
	 	Denver, CO  80206
	Purchaser)
	 	Attn:  Angela Morton
	Subscription Amount: $1,023,142.00
Shares: 292,326
	 	with a copy to:
	 
	 	Address for Delivery of
	 
	 	Shares for Purchaser:
	 
	 	SNORKLEBAY & CO.
	 
	 	151 Detroit St.
	 
	 	Denver, CO  80206
	 
	 	Attn:  Corie Carlson






4




IN WITNESS WHEREOF, the parties hereto have caused this Securities Purchase Agreement to be
duly executed by their respective authorized signatories as of the date first indicated above.



	 	 	 	 	 
	PURCHASER	 	 	 	 
	Janus Capital Funds plc on behalf of its series
Janus US Venture Fund                                                  
	 	 	 	 
	 
	 	 	 	 
	Name of Purchaser
/s/ William H. Bales                                                  
	 	 	 	 
	 
	 	 	 	 
	Signature of Purchaser or by Authorized Person executing for Purchaser
	 	Address for Notice:
	Printed Name: William H. Bales
	 	 	—	 
	Title: Portfolio Manager
	 	Janus Capital Management LLC
	Its:__________________________________________
	 	151 Detroit Street
	(Printed Name of Authorized Person and Title for Person executing for
	 	Denver, CO  80206
	Purchaser)
	 	Attn:  Angela Morton
	Subscription Amount: $1,648,010.00
Shares: 470,860
	 	with a copy to:
	 
	 	Address for Delivery of
	 
	 	Shares for Purchaser:
	 
	 	BBH fbo Janus US Venture Fund
	 
	 	151 Detroit St.
	 
	 	Denver, CO  80206






5




IN WITNESS WHEREOF, the parties hereto have caused this Securities Purchase Agreement to be
duly executed by their respective authorized signatories as of the date first indicated above.



	 	 	 	 	 
	PURCHASER	 	 	 	 
	Janus Investment Fund on behalf of its series
Janus Venture Fund                                                        
	 	 	 	 
	 
	 	 	 	 
	Name of Purchaser
/s/ William H. Bales                                                 
	 	 	 	 
	 
	 	 	 	 
	Signature of Purchaser or by Authorized Person executing for Purchaser
	 	Address for Notice:
	Printed Name: William H. Bales
	 	 	—	 
	Title: Portfolio Manager
	 	Janus Capital Management LLC
	Its:__________________________________________
	 	151 Detroit Street
	(Printed Name of Authorized Person and Title for Person executing for
	 	Denver, CO  80206
	Purchaser)
	 	Attn:  Angela Morton
	Subscription Amount: $15,414,703.00
Shares: 4,404,201
	 	with a copy to:
	 
	 	Address for Delivery of
	 
	 	Shares for Purchaser:
	 
	 	BROOKBEND & CO.
	 
	 	151 Detroit St.
	 
	 	Denver, CO  80206






6




IN WITNESS WHEREOF, the parties hereto have caused this Securities Purchase Agreement to be
duly executed by their respective authorized signatories as of the date first indicated above.



	 	 	 	 	 
	PURCHASER	 	 	 	 
	Ohio National Fund
Inc.                                                      
	 	 	 	 
	 
	 	 	 	 
	Name of Purchaser
/s/ William H. Bales                                                 
	 	 	 	 
	 
	 	 	 	 
	Signature of Purchaser or by Authorized Person executing for Purchaser
	 	Address for Notice:
	Printed Name: William H. Bales
	 	 	—	 
	Title: Portfolio Manager
	 	Janus Capital Management LLC
	Its:__________________________________________
	 	151 Detroit Street
	(Printed Name of Authorized Person and Title for Person executing for
	 	Denver, CO  80206
	Purchaser)
	 	Attn:  Angela Morton
	Subscription Amount: $244,788.00
Shares: 69,939
	 	with a copy to:
	 
	 	Address for Delivery of
	 
	 	Shares for Purchaser:
	 
	 	Cede Co.
	 
	 	151 Detroit St.
	 
	 	Denver, CO  80206






7




IN WITNESS WHEREOF, the parties hereto have caused this Securities Purchase Agreement to be
duly executed by their respective authorized signatories as of the date first indicated above.



	 	 	 	 	 
	PURCHASER	 	 	 	 
	Strata Capital Management                                            
	 	 	 	 
	 
	 	 	 	 
	Name of Purchaser
/s/ Steve Bardack                                                      
	 	 	 	 
	 
	 	 	 	 
	Signature of Purchaser or by Authorized Person executing for Purchaser
Printed Name: Steve Bardack
Title: President
Its: /s/ Steve Bardack, President                                     
	 	Address for Notice:
	 
	 	 	 	 
	(Printed Name of Authorized Person and Title for Person executing for
	 	9665 Wilshire Blvd., Suite 505
	Purchaser)
	 	Beverly Hills, CA  90212
	Subscription Amount: $13,300,000.00
Shares: 3,800,000
	 	with a copy to:
	 
	 	Address for Delivery of
	 
	 	Shares for Purchaser:
	 
	 	BROOKBEND & CO.
	 
	 	151 Detroit St.
	 
	 	Denver, CO  80206






8




IN WITNESS WHEREOF, the parties hereto have caused this Securities Purchase Agreement to be
duly executed by their respective authorized signatories as of the date first indicated above.



	 	 	 
	PURCHASER	 	 
	UBS O’Connor LLC f/b/o/: O’Connor Global

Multi-Strategy Alpha Master Limited                            

	 	



	 

	 	

	Name of Purchaser

/s/ Kipp Schrage                                                       

	 	



	 

	 	

	Signature of Purchaser or by Authorized Person executing for Purchaser

Printed Name: Kipp Schrage

Title: Managing Director

Its:     

(Printed Name of Authorized Person and Title for Person executing for

	 	







Address for Notice:
	Purchaser)

	 	—
	Subscription Amount: $1,112,156.50

Shares: 317,759

	 	

with a copy to:
	
 
	 	Address for

Delivery of Shares

for Purchaser:
	
 
	 	 






9




IN WITNESS WHEREOF, the parties hereto have caused this Securities Purchase Agreement to be
duly executed by their respective authorized signatories as of the date first indicated above.



	 	 	 
	PURCHASER	 	 
	UBS O’Connor LLC f/b/o/:

	 	

	Fundamental Market Neutral MAC81 Ltd.                   

	 	

	 

	 	

	Name of Purchaser

/s/ Kipp Schrage                                                       

	 	



	 

	 	

	Signature of Purchaser or by Authorized Person executing for Purchaser

Printed Name: Kipp Schrage

Title: Managing Director

Its:     

(Printed Name of Authorized Person and Title for Person executing for

	 	







Address for Notice:
	Purchaser)

	 	—
	Subscription Amount: $177,912

Shares: 50,832

	 	

with a copy to:
	
 
	 	Address for

Delivery of Shares

for Purchaser:
	
 
	 	 






10




IN WITNESS WHEREOF, the parties hereto have caused this Securities Purchase Agreement to be
duly executed by their respective authorized signatories as of the date first indicated above.



	 	 	 
	PURCHASER	 	 
	UBS O’Connor LLC f/b/o/: O’Connor Global

Fundamental Market Neutral Long/Short Master Limited

	 	



	 

	 	

	Name of Purchaser

/s/ Kipp Schrage                                                       

	 	



	 

	 	

	Signature of Purchaser or by Authorized Person executing for Purchaser

Printed Name: Kipp Schrage

Title: Managing Director

Its:     

(Printed Name of Authorized Person and Title for Person executing for

	 	







Address for Notice:
	Purchaser)

	 	—
	Subscription Amount: $1,006,757.50

Shares: 287,645

	 	

with a copy to:
	
 
	 	Address for

Delivery of Shares

for Purchaser:
	
 
	 	 






11




IN WITNESS WHEREOF, the parties hereto have caused this Securities Purchase Agreement to be
duly executed by their respective authorized signatories as of the date first indicated above.



	 	 	 
	PURCHASER	 	 
	UBS O’Connor LLC f/b/o/: O’Connor Pipes

Corporate Strategies Master Limited                            

	 	



	 

	 	

	Name of Purchaser

/s/ Jeffrey Putman                                                   

	 	



	 

	 	

	Signature of Purchaser or by Authorized Person executing for Purchaser

Printed Name: Jeffrey Putman

Title: Portfolio Manager

Its:     

(Printed Name of Authorized Person and Title for Person executing for

	 	







Address for Notice:
	Purchaser)

	 	—
	Subscription Amount: $2,107,955.50

Shares: 602,273

	 	

with a copy to:
	
 
	 	Address for

Delivery of Shares

for Purchaser:
	
 
	 	 






12




IN WITNESS WHEREOF, the parties hereto have caused this Securities Purchase Agreement to be
duly executed by their respective authorized signatories as of the date first indicated above.



	 	 	 
	PURCHASER	 	 
	UBS O’Connor LLC f/b/o/: O’Connor Global

Fundamental Long/Short Directional Master Limited   

	 	



	 

	 	

	Name of Purchaser

/s/ Paul Mitchell                                                       

	 	



	 

	 	

	Signature of Purchaser or by Authorized Person executing for Purchaser

Printed Name: Paul Mitchell

Title: Managing Director

Its:     

(Printed Name of Authorized Person and Title for Person executing for

	 	







Address for Notice:
	Purchaser)

	 	—
	Subscription Amount: $232,718.50

Shares: 66,491

	 	

with a copy to:
	
 
	 	Address for

Delivery of Shares

for Purchaser:
	
 
	 	 






13




IN WITNESS WHEREOF, the parties hereto have caused this Securities Purchase Agreement to be
duly executed by their respective authorized signatories as of the date first indicated above.



	 	 	 	 	 
	PURCHASER	 	 	 	 
	SF Capital Partners, Ltd.                                               
	 	 	 	 
	 
	 	 	 	 
	Name of Purchaser
/s/ Brian Davidson                                                  
	 	 	 	 
	 
	 	 	 	 
	Signature of Purchaser or by Authorized Person executing for Purchaser
	 	Address for Notice:
	Printed Name: Brian Davidson
	 	 	—	 
	Title: Managing Director
	 	c/o Stark Offshore Management
	Its:__________________________________________
	 	LLC
	(Printed Name of Authorized Person and Title for Person executing
	 	3600 South Lake Drive
	for Purchaser)
	 	St. Francis, WI  53235
	Subscription Amount: $4,637,500
Shares: 1,325,000
	 	with a copy to:
	 
	 	Address for Delivery of Shares
	 
	 	for Purchaser:
	 
	 	M&I Wealth Management
	 
	 	Investment Coordination Dept.
	 
	 	Attn: Jamie Race
	 
	 	11270 West Park Place, Suite 400
	 
	 	Milwaukee, WI  53224
	 
	 	 	(414) 815-3693	 






14




IN WITNESS WHEREOF, the parties hereto have caused this Securities Purchase Agreement to be
duly executed by their respective authorized signatories as of the date first indicated above.



	 	 	 	 	 
	PURCHASER	 	 	 	 
	Ermitage Selz Fund Ltd.                                               
	 	 	 	 
	 
	 	 	 	 
	Name of Purchaser
/s/ Bernard Selz                                                      
	 	 	 	 
	 
	 	 	 	 
	Signature of Purchaser or by Authorized Person executing for Purchaser
Printed Name: Bernard Selz
	 	Address for Notice:
	Title: Managing Member, Selz Capital LLC
	 	 	—	 
	Its: Investment Adviser
	 	c/o Selz Capital LLC
	(Printed Name of Authorized Person and Title for Person executing for
	 	600 Fifth Avenue (25th Floor)
	Purchaser)
	 	New York, NY  10020
	Subscription Amount: $731,500
Shares: 209,000
	 	with a copy to:
	 
	 	Address for Delivery of Shares for
	 
	 	Purchaser:
	 
	 	c/o Selz Capital LLC
	 
	 	600 Fifth Avenue (25th Floor)
	 
	 	New York, NY  10020






15




IN WITNESS WHEREOF, the parties hereto have caused this Securities Purchase Agreement to be
duly executed by their respective authorized signatories as of the date first indicated above.



	 	 	 	 	 
	PURCHASER	 	 	 	 
	Karnak Partners, L.P.                                                  
	 	 	 	 
	 
	 	 	 	 
	Name of Purchaser
/s/ Bernard Selz                                                      
	 	 	 	 
	 
	 	 	 	 
	Signature of Purchaser or by Authorized Person executing for Purchaser
Printed Name: Bernard Selz
	 	Address for Notice:
	Title: Managing Member, Luxor LLC
	 	 	—	 
	Its: General Partner
	 	c/o Selz Capital LLC
	(Printed Name of Authorized Person and Title for Person executing for
	 	600 Fifth Avenue (25th Floor)
	Purchaser)
	 	New York, NY  10020
	Subscription Amount: $528,500.00
Shares: 151,000
	 	with a copy to:
	 
	 	Address for Delivery of Shares for
	 
	 	Purchaser:
	 
	 	c/o Selz Capital LLC
	 
	 	600 Fifth Avenue (25th Floor)
	 
	 	New York, NY  10020






16




IN WITNESS WHEREOF, the parties hereto have caused this Securities Purchase Agreement to be
duly executed by their respective authorized signatories as of the date first indicated above.



	 	 	 	 	 
	PURCHASER	 	 	 	 
	GAM Selection Hedge Investments Inc.                     
	 	 	 	 
	 
	 	 	 	 
	Name of Purchaser
/s/ Bernard Selz                                                      
	 	 	 	 
	 
	 	 	 	 
	Signature of Purchaser or by Authorized Person executing for Purchaser
Printed Name: Bernard Selz
	 	Address for Notice:
	Title: Managing Member, Selz Capital LLC
	 	 	—	 
	Its: Investment Adviser
	 	c/o Selz Capital LLC
	(Printed Name of Authorized Person and Title for Person executing for
	 	600 Fifth Avenue (25th Floor)
	Purchaser)
	 	New York, NY  10020
	Subscription Amount: $1,120,000
Shares: 320,000
	 	with a copy to:
	 
	 	Address for Delivery of Shares for
	 
	 	Purchaser:
	 
	 	c/o Selz Capital LLC
	 
	 	600 Fifth Avenue (25th Floor)
	 
	 	New York, NY  10020






17




IN WITNESS WHEREOF, the parties hereto have caused this Securities Purchase Agreement to be
duly executed by their respective authorized signatories as of the date first indicated above.



	 	 	 	 	 
	PURCHASER	 	 	 	 
	Selz Family Trust                                                        
	 	 	 	 
	 
	 	 	 	 
	Name of Purchaser
/s/ Lisa P. Selz                                                      
	 	 	 	 
	 
	 	 	 	 
	Signature of Purchaser or by Authorized Person executing for Purchaser
Printed Name: Lisa P. Selz
	 	Address for Notice:
	Title: Trustee
	 	 	—	 
	Its: Authorized Signatory
	 	c/o Selz Capital LLC
	(Printed Name of Authorized Person and Title for Person executing for
	 	600 Fifth Avenue (25th Floor)
	Purchaser)
	 	New York, NY  10020
	Subscription Amount: $2,345,000
Shares: 670,000
	 	with a copy to:
	 
	 	Address for Delivery of Shares for
	 
	 	Purchaser:
	 
	 	c/o Selz Capital LLC
	 
	 	600 Fifth Avenue (25th Floor)
	 
	 	New York, NY  10020






18




IN WITNESS WHEREOF, the parties hereto have caused this Securities Purchase Agreement to be
duly executed by their respective authorized signatories as of the date first indicated above.



	 	 	 
	PURCHASER	 	 
	Galleon International Master Fund,

SPC Ltd. — Galleon EM Technology SPC                    

	 	



	 

	 	

	Name of Purchaser

/s/ Raj Rajaratnam                                                  

	 	



	 

	 	

	Signature of Purchaser or by Authorized Person executing for Purchaser

Printed Name: Raj Rajaratnam

Title: Director

Its:

	 	







	(Printed Name of Authorized Person and Title for Person executing

	 	Address for Notice:
	for Purchaser)

	 	—
	Subscription Amount: $2,625,000

Shares: 750,000

	 	

with a copy to:
	
 
	 	Address for

Delivery of Shares

for Purchaser:
	
 
	 	 






19




IN WITNESS WHEREOF, the parties hereto have caused this Securities Purchase Agreement to be
duly executed by their respective authorized signatories as of the date first indicated above.



	 	 	 	 	 
	PURCHASER	 	 	 	 
	M.D. Sass Maximum Partners, L.P.
By: M.D. Sass Investors Services, Inc., General Partner
	 	 	 	 
	 
	 	 	 	 
	Name of Purchaser
/s/ Bobby Liu                                                         
	 	 	 	 
	 
	 	 	 	 
	Signature of Purchaser or by Authorized Person executing for Purchaser
Printed Name: Bobby Liu
	 	Address for Notice:
	Title: Senior Vice President, General Counsel
	 	 	—	 
	Its:
	 	1185 Avenue of the Americas
	(Printed Name of Authorized Person and Title for Person executing for
	 	18th Floor
	Purchaser)
	 	New York, NY  10036
	Subscription Amount: $1,137,500
Shares: 325,000
	 	with a copy to:
	 
	 	Address for Delivery of
	 
	 	Shares for Purchaser:






20




IN WITNESS WHEREOF, the parties hereto have caused this Securities Purchase Agreement to be
duly executed by their respective authorized signatories as of the date first indicated above.



	 	 	 	 	 
	PURCHASER	 	 	 	 
	Basso Multi-Strategy Holding Fund Ltd.                     
	 	 	 	 
	 
	 	 	 	 
	Name of Purchaser
/s/ Philip Platek                                                      
—
	 	Address for Notice:
	Signature of Purchaser or by Authorized Person executing for Purchaser
	 	 	—	 
	Printed Name: Philip Platek
	 	Basso Capital Management, L.P.
	Title: Authorized Signatory
	 	1266 East Main Street
	Its:
	 	Stamford, CT  06902
	(Printed Name of Authorized Person and Title for Person executing for
	 	Attn:  Marc Seidenberg
	Purchaser)
	 	Philip Platek
	Subscription Amount: $752,500
Shares: 215,000
	 	with a copy to:
	 
	 	Address for Delivery of
	 
	 	Shares for Purchaser:
	 
	 	Citigroup Global Markets
	 
	 	390 Greenwich Street
	 
	 	New York, NY  10013
	 
	 	Attn:  Tara Triola
	 
	 	 	(212) 723-4733	 






21




IN WITNESS WHEREOF, the parties hereto have caused this Securities Purchase Agreement to be
duly executed by their respective authorized signatories as of the date first indicated above.



	 	 	 	 	 
	PURCHASER	 	 	 	 
	Basso Fund Ltd.                                                          
	 	 	 	 
	 
	 	 	 	 
	Name of Purchaser
/s/ Philip Platek                                                      
—
	 	Address for Notice:
	Signature of Purchaser or by Authorized Person executing for Purchaser
	 	 	—	 
	Printed Name: Philip Platek
	 	Basso Capital Management, L.P.
	Title: Authorized Signatory
	 	1266 East Main Street
	Its:
	 	Stamford, CT  06902
	(Printed Name of Authorized Person and Title for Person executing for
	 	Attn:  Marc Seidenberg
	Purchaser)
	 	Philip Platek
	Subscription Amount: $112,500
Shares: 35,000
	 	with a copy to:
	 
	 	Address for Delivery of
	 
	 	Shares for Purchaser:
	 
	 	Citigroup Global Markets
	 
	 	390 Greenwich Street
	 
	 	New York, NY  10013
	 
	 	Attn:  Tara Triola
	 
	 	 	(212) 723-4733	 






22




IN WITNESS WHEREOF, the parties hereto have caused this Securities Purchase Agreement to be
duly executed by their respective authorized signatories as of the date first indicated above.



	 	 	 
	PURCHASER	 	 
	Straus-GEPT Partners LP                                            

	 	

	 

	 	

	Name of Purchaser

/s/ Craig Connors                                                   

	 	



	 

	 	

	Signature of Purchaser or by Authorized Person executing for Purchaser

Printed Name: Craig Connors

Title: CFO

Its:

	 	







	(Printed Name of Authorized Person and Title for Person executing

	 	Address for Notice:
	for Purchaser)

	 	—
	Subscription Amount: $350,000

Shares: 100,000

	 	

with a copy to:
	
 
	 	Address for

Delivery of Shares

for Purchaser:
	
 
	 	 






23




IN WITNESS WHEREOF, the parties hereto have caused this Securities Purchase Agreement to be
duly executed by their respective authorized signatories as of the date first indicated above.



	 	 	 	 	 
	PURCHASER	 	 	 	 
	Straus Partners LP                                                       
	 	 	 	 
	 
	 	 	 	 
	Name of Purchaser
/s/ Craig Connors                                                   
	 	 	 	 
	 
	 	 	 	 
	Signature of Purchaser or by Authorized Person executing for Purchaser
Printed Name: Craig Connors
	 	Address for Notice:
	Title: CFO
	 	 	—	 
	Its:
	 	Straus Asset Management
	(Printed Name of Authorized Person and Title for Person executing
	 	320 Park Avenue, 10th Floor
	for Purchaser)
	 	New York, New York  10022
	Subscription Amount: $700,000
Shares: 200,000
	 	with a copy to:
	 
	 	Address for Delivery of Shares for
	 
	 	Purchaser:
	 
	 	Straus Asset Management
	 
	 	320 Park Avenue, 10th Floor
	 
	 	New York, New York  10022






24




IN WITNESS WHEREOF, the parties hereto have caused this Securities Purchase Agreement to be
duly executed by their respective authorized signatories as of the date first indicated above.



	 	 	 
	PURCHASER	 	 
	Buckland Partners Focus Fund, LP                             

	 	

	 

	 	

	Name of Purchaser

/s/ Jonathan Lieber                                                

	 	



	 

	 	

	Signature of Purchaser or by Authorized Person executing for Purchaser

Printed Name: Jonathan Lieber

Title: Member, Buckland Partners Focus Fund, LLC

Its: General Partner

(Printed Name of Authorized Person and Title for Person executing

	 	







Address for Notice:
	for Purchaser)

	 	—
	Subscription Amount: $612,500

Shares: 175,000

	 	

with a copy to:
	
 
	 	Address for

Delivery of Shares

for Purchaser:
	
 
	 	 






25




IN WITNESS WHEREOF, the parties hereto have caused this Securities Purchase Agreement to be
duly executed by their respective authorized signatories as of the date first indicated above.



	 	 	 	 	 
	PURCHASER	 	 	 	 
	Heller Capital Investment                                              
	 	 	 	 
	 
	 	 	 	 
	Name of Purchaser
/s/ Ronald I. Heller                                                   
	 	 	 	 
	 
	 	 	 	 
	Signature of Purchaser or by Authorized Person executing for Purchaser
Printed Name: Ronald I. Heller
Title: CIO
	 	Address for Notice:
	Its:
	 	 	—	 
	(Printed Name of Authorized Person and Title for Person executing for
	 	700 E. Palisade Avenue
	Purchaser)
	 	Englewood Cliffs, NJ  07632
	Subscription Amount: $525,000
Shares: 150,000
	 	with a copy to:
	 
	 	Address for Delivery of
	 
	 	Shares for Purchaser:







26