<PAGE>

                                                                   Exhibit 10.17

THIS SECURITY AND THE SHARES OF COMMON STOCK ISSUABLE UPON EXERCISE OF THIS
SECURITY HAVE NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY
STATE AND ANY SALE, TRANSFER, PLEDGE OR OTHER DISPOSITION THEREOF MAY BE MADE
ONLY (i) IN A REGISTRATION OR QUALIFICATION OR (ii) IF AN EXEMPTION FROM
REGISTRATION OR QUALIFICATION IS AVAILABLE AND THE COMPANY HAS RECEIVED AN
OPINION OF COUNSEL TO THAT EFFECT REASONABLY SATISFACTORY TO THE COMPANY.

SALE OR OTHER TRANSFER OF THIS SECURITY OR THE SHARES OF COMMON STOCK ISSUABLE
UPON EXERCISE OF THIS SECURITY IS FURTHER RESTRICTED FOR UP TO 180 DAYS
FOLLOWING AN INITIAL PUBLIC OFFERING OF SECURITIES OF THE COMPANY.

Void After 5:00 p.m. Vista, California time on June 20, 2006

                               WARRANT TO PURCHASE
                             SHARES OF COMMON STOCK
                                       OF
                       REDLINE PERFORMANCE PRODUCTS, INC.

Warrant No. GA-1                                                 Shares: 120,601

         THIS CERTIFIES that, subject to the terms and conditions herein set
forth, GUNNALLEN FINANCIAL, INC. ("AGENT") or registered assigns, is entitled to
purchase from REDLINE PERFORMANCE PRODUCTS, INC., a Minnesota corporation (the
"COMPANY"), at any time beginning June 20, 2003 and until June 20, 2006 (the
"AGENT'S WARRANT"), One Hundred Twenty Thousand, Six Hundred One (120,601) fully
paid and nonassessable shares of $0.01 par value per share common stock of the
Company (such class of shares being referred to as the "COMMON STOCK," and such
shares of Common Stock which may be acquired upon exercise of this Agent's
Warrant being referred to as the "WARRANT SHARES"). This Agent's Warrant is
being issued in connection with a placement (the "SERIES A PREFERRED UNIT
PLACEMENT") of Series A Convertible Preferred Stock ("SERIES A STOCK") and
Common Stock Purchase Warrants being conducted by the Company to raise up to
$5,000,000. As used herein, the term "HOLDER" means the Agent, or any record
holder or holders of the Warrant or Warrant Shares, whether in whole or in part.

         This Warrant is subject to the following provisions, terms and
conditions:

         1.)     Purchase Price. Subject to adjustment as hereinafter provided,
the purchase price of each Warrant Share shall be One and 50/100 Dollars
($1.50). The purchase price of one Warrant Share is referred to herein as the
"WARRANT EXERCISE PRICE."

<PAGE>

         2.)     Adjustment of Warrant Exercise Price and Number of Warrant
Shares. The provisions in this Agent's Warrant relating to the Warrant Exercise
Price and the number of Warrant Shares to be issued upon exercise of this
Agent's Warrant shall be subject to adjustment from time to time as hereinafter
provided.

         (a)     Upon each adjustment of the Warrant Exercise Price, the Holder
                 of this Agent's Warrant shall thereafter be entitled to
                 purchase, at the Warrant Exercise Price resulting from such
                 adjustment, the number of shares of Common Stock obtained by
                 multiplying the Warrant Exercise Price in effect immediately
                 prior to such adjustment by the number of shares of Common
                 Stock purchasable hereto immediately prior to such adjustment
                 and dividing the product thereof by the Warrant Exercise Price
                 resulting from such adjustment.

         (b)     In case the Company shall at any time subdivide its outstanding
                 Common Stock into a greater number of shares or declare a
                 dividend payable in Common Stock, the Warrant Exercise Price in
                 effect immediately prior to such subdivision shall be
                 proportionately reduced and the number of shares of Common
                 Stock purchasable pursuant to this Agent's Warrant shall be
                 proportionately increased, and conversely, in case the
                 Company's outstanding Common Stock shall be combined into a
                 smaller number of shares, the Warrant Exercise Price in effect
                 immediately prior to such combination shall be proportionately
                 increased and the number of shares of Common Stock purchasable
                 upon the exercise of this Agent's Warrant shall be
                 proportionately reduced.

         (c)     If any capital reorganization or reclassification of the
                 capital stock of the Company, or consolidation or merger of the
                 Company with another corporation, or the sale of all or
                 substantially all of its assets to another corporation shall be
                 effected in such a way that holders of Common Stock shall be
                 entitled to receive stock, securities or assets ("SUBSTITUTED
                 PROPERTY") with respect to or in exchange for such Common
                 Stock, then, as a condition of such reorganization,
                 reclassification, consolidation, merger or sale, the Holder
                 shall have the right, upon payment of the aggregate Warrant
                 Exercise Price, to purchase and receive upon the basis and upon
                 the terms and conditions specified in this Agent's Warrant, and
                 in lieu of the Common Stock of the Company immediately
                 theretofore purchasable and receivable upon the exercise of the
                 rights represented hereby, such Substituted Property as would
                 have been issued or delivered to the Holder if it had exercised
                 this Agent's Warrant and had received upon exercise of this
                 Agent's Warrant the Common Stock prior to such reorganization,
                 reclassification, consolidation, merger, or sale. The Company
                 shall not effect any such consolidation, merger, or sale,
                 unless prior to the consummation thereof the successor
                 corporation (if other than the Company) resulting from such
                 consolidation or merger or the corporation purchasing such
                 assets shall assume the obligation to deliver to the Holder
                 such Substituted Property as, in accordance with the foregoing
                 provisions, the Holder may be entitled to purchase.

                                       2.

<PAGE>

         (d)     If the Company takes any other action, or if any other event
                 occurs which does not come within the scope of the provisions
                 of Sections 2(b) or 2(c), but which should, in the Company's
                 reasonable judgment, result in an adjustment in the Warrant
                 Exercise Price and/or the number of shares subject to the
                 Agent's Warrant in order to fairly protect the purchase rights
                 of the Holder, an appropriate adjustment in such purchase
                 rights shall be made by the Company.

         (e)     Upon any adjustment of the Warrant Exercise Price or the number
                 of shares issuable upon this Agent's Warrant, the Company shall
                 give written notice thereof, by first-class mail, postage
                 prepaid, addressed to the Holder at the address of the Holder
                 as shown on the books of the Company, which notice shall state
                 the Warrant Exercise Price resulting from such adjustment and
                 the increase or decrease, if any, in the number of shares
                 purchasable at such price upon the exercise of this Agent's
                 Warrant, setting forth in reasonable detail the method of
                 calculation and the facts upon which such calculation is based.

         3.)     No Fractional Shares. No fractional shares will be issued in
connection with any exercise of this Agent's Warrant. In lieu of any fractional
share which would otherwise be issuable, the Company shall pay cash equal to the
product of such fraction multiplied by the fair market value, as determined by
the Company's officers, of one (1) share of Common Stock on the date of
exercise.

         4.)     No Shareholder Rights. This Agent's Warrant shall not entitle
its Holder to vote, receive dividends or exercise any of the rights of a
shareholder of the Company prior to exercise of this Agent's Warrant.

         5.)     Covenants of the Company. The Company covenants that during the
period this Agent's Warrant is exercisable, the Company will reserve from its
authorized and unissued shares of Common Stock a sufficient number of shares of
Common Stock to provide for the issuance of Warrant Shares upon the exercise of
this Agent's Warrant. The Company further covenants that all Warrant Shares that
may be issued upon the exercise of this Agent's Warrant will, upon payment and
issuance, be duly authorized and issued, fully paid and nonassessable shares of
Common Stock.

         6.)     Exercise of Agent's Warrant. This Agent's Warrant may be
exercised by the registered Holder, in whole or in part, by the surrender of
this Agent's Warrant at the principal office of the Company, together with the
Exercise Form attached hereto duly executed, accompanied by payment in full of
the amount of the aggregate Warrant Exercise Price in cash, cashier's check or
bank draft. Upon partial exercise hereof, a new warrant or warrants containing
the same date and provisions as this Agent's Warrant shall be issued by the
Company to the registered Holder for the number of Warrant Shares with respect
to which this Agent's Warrant shall not have been exercised. The Agent's Warrant
shall be deemed to have been exercised immediately prior to the close of
business on the date the Company is in receipt of this Agent's Warrant, a
completed Exercise Form, all documents the Company may reasonably request from
the Holder for the purpose of complying with applicable securities and other
laws, and payment for the number of Warrant Shares being acquired upon exercise
of this Agent's Warrant. The

                                       3.

<PAGE>

Holder entitled to receive the Warrant Shares issuable upon such exercise shall
be treated for all purposes as the Holder of record of such Warrant Shares as of
the close of business on such date. After such date, the Company shall issue and
deliver to the Holder or Holders entitled to receive the same, a certificate or
certificates for the number of full Warrant Shares issuable upon such exercise,
together with cash in lieu of any fraction of a share, as provided above.

         7.)     Registration of Warrant Shares. The rights of the Holder of
this Agent's Warrant to include Warrant Shares in a registered offering of
securities conducted by the Company are set forth in Appendix A to the Form of
Subscription Agreement and Letter of Investment Intent (Investor Rights
Provisions) utilized in connection with the Company's sale of shares of Series A
Stock, between the Company and each of the Series A Stock investors.

         8.)     Compliance with Securities Laws and Other Transfer
Restrictions.

         (a)     The Holder of this Agent's Warrant, by acceptance hereof,
                 agrees, represents and warrants that this Agent's Warrant and
                 the Warrant Shares which may be issued upon exercise hereof are
                 being acquired for investment, that the Holder has no present
                 intention to resell or otherwise dispose of all or any part of
                 this Agent's Warrant or any Warrant Shares, and that the Holder
                 will not offer, sell or otherwise dispose of all or any part of
                 this Agent's Warrant or any Warrant Shares except under
                 circumstances which will not result in a violation of the
                 Securities Act of 1933, as amended (the "ACT") or applicable
                 state securities laws. The Company may condition any transfer,
                 sale, pledge, assignment or other disposition on the receipt
                 from the party to whom this Agent's Warrant is to be so
                 transferred or to whom Warrant Shares are to be issued or so
                 transferred, of any representations and agreements requested by
                 the Company in order to permit such issuance or transfer to be
                 made pursuant to exemptions from registration under federal and
                 applicable state securities laws. Upon exercise of this Agent's
                 Warrant, the Holder hereof shall, if requested by the Company,
                 confirm in writing Holder's investment purpose and acceptance
                 of the restrictions on transfer of the Warrant Shares, as well
                 as any representations and agreements requested by the Company
                 in order to permit the issuance of Warrant Shares to be made
                 pursuant to exemptions from registration under federal and
                 applicable state securities laws.

         (b)     In the event the Holder of this Agent's Warrant desires to
                 transfer this Agent's Warrant, the Holder shall provide the
                 Company with a Form of Assignment, in the form attached hereto
                 describing the manner of such transfer, and an opinion of
                 counsel (reasonably acceptable to the Company) that the
                 proposed transfer may be effected without registration or
                 qualification under applicable securities laws, whereupon such
                 Holder shall be entitled to transfer this Agent's Warrant in
                 accordance with the notice delivered by such Holder to the
                 Company. If, in the opinion of the counsel referred to in this
                 Section, the proposed transfer or disposition described in the
                 written notice given may not be effected without registration
                 or qualification of this Agent's Warrant, the Company shall
                 give written notice thereof to the Holder hereof, and such
                 Holder will limit its activities in respect to such proposed
                 transfer or disposition as, in the opinion of such

                                       4.

<PAGE>

                 counsel, are permitted by law. The Company may place one or
                 more restrictive legends on the Agent's Warrant or any
                 certificates representing the Warrant Shares which set forth
                 the restrictions contained herein, and may further place a
                 "stop transfer" restriction in the Company's books and records
                 with respect to the Agent's Warrant and any Warrant Shares. The
                 restrictions set forth in this Agent's Warrant shall be binding
                 upon any holder, donee, assignee or transferee of the Agent's
                 Warrant or the Warrant Shares.

         (c)     If the Company conducts an initial public offering of its
                 Common Stock by filing a registration statement under the Act,
                 the Holder of this Agent's Warrant or any Warrant Shares shall
                 not, without the prior written consent of the Company and the
                 managing underwriter in such offering: (i) sell, transfer or
                 otherwise dispose of, or agree to sell, transfer or otherwise
                 dispose of the Agent's Warrant or any of the Warrant Shares;
                 (ii) sell, transfer or otherwise dispose of, or agree to sell,
                 transfer or otherwise dispose of the Agent's Warrant or any
                 right to purchase any of the Warrant Shares; or (iii) sell or
                 grant, or agree to sell or grant, options, rights or warrants
                 with respect to the Agent's Warrant or any of the Warrant
                 Shares. Such restrictions shall be effective for a period of
                 time equal to the period during which the managing underwriter
                 imposes such transfer restrictions on the Company's officers
                 and directors; provided, that in no event shall the restricted
                 period applicable to the Holder of this Agent's Warrant exceed
                 180 days after effectiveness of the Company's registration
                 statement filed under the Act with the Securities and Exchange
                 Commission with respect to such initial public offering.

         9.)     Subdivision of Agent's Warrant. At the request of the Holder of
this Agent's Warrant in connection with a transfer or exercise of a portion of
the Agent's Warrant, upon surrender of such Agent's Warrant for such purpose to
the Company, the Company will issue and exchange therefor warrants of like tenor
and date representing in the aggregate the right to purchase such number of
shares of Common Stock as shall be designated by such Holder at the time of such
surrender; provided, however, that the Company's obligations to subdivide
securities under this Section shall be subject to and conditioned upon the
compliance of any such subdivision with applicable securities laws.

         10.)    Postponement of Exercise. Notwithstanding anything herein to
the contrary, the Company shall have the right to delay any exercise for a
period of up to one hundred eighty (180) days for the purpose of: (a) ensuring
the availability of an exemption under applicable securities laws for the
issuance of the Warrant Shares to the Holder in light of the transactions by the
Company in its securities; and/or (b) facilitating a distribution of the
Company's securities. In either case, if the Company elects to delay any such
exercise, the Company shall inform the Holder, in writing, of such delay and the
terms of such delay. Any such delay shall not lead to any change in the Warrant
Price or the terms of the Warrant and shall not extend the term of any Warrant
unless such delay would extend past the expiration date of such Warrant. In such
case, the expiration date shall be extended to thirty (30) days after the end of
such delay.

         11.)    Loss, Theft, Destruction or Mutilation of Agent's Warrant. Upon
receipt by the Company of evidence reasonably satisfactory to it of the loss,
theft, destruction or mutilation of

                                       5.

<PAGE>

this Agent's Warrant, and in case of loss, theft or destruction, of indemnity or
security reasonably satisfactory to it, and upon reimbursement to the Company of
all reasonable expenses incidental thereto, and upon surrender and cancellation
of this Agent's Warrant, if mutilated, the Company will make and deliver a new
Agent's Warrant of like tenor and dates as of such cancellation, in lieu of this
Agent's Warrant.

         12.)    No Limitation on Corporate Action. No provisions of the Agent's
Warrant and no right or option granted or conferred hereunder shall in any way
limit, affect, or abridge the exercise by the Company of any of its corporate
rights or powers to recapitalize, amend its Articles of Incorporation,
reorganize or merge with or into another corporation, or to transfer all or any
part of its property or assets, or the exercise of any other of its corporate
rights and powers.

         13.)    Additional Right to Convert Agent's Warrant (Cashless
Exercise).

         (a)     The Holder of this Agent's Warrant shall have the right to
                 require the Company to convert this Agent's Warrant (the
                 "CONVERSION RIGHT") at any time after it is exercisable but
                 prior to its expiration, into shares of Company Common Stock as
                 provided for in this Section. Upon exercise of the Conversion
                 Right, the Company shall deliver to the Holder (without payment
                 by the Holder of any Warrant Exercise Price) that number of
                 shares of Company Common Stock equal to the quotient obtained
                 by dividing (x) the value of the Warrant at the time the
                 Conversion Right is exercised (determined by subtracting the
                 aggregate Warrant Exercise Price for the Warrant Shares in
                 effect immediately prior to the exercise of the Conversion
                 Right from the aggregate Fair Market Value for the Warrant
                 Shares immediately prior to the exercise of the Conversion
                 Right) by (y) the Fair Market Value of one (1) share of Company
                 Common Stock immediately prior to the exercise of the
                 Conversion Right.

         (b)     The Conversion Right may be exercised by the Holder, at any
                 time or from time to time, prior to its expiration, on any
                 business day by delivering a written notice in the form
                 attached hereto (the "CONVERSION NOTICE") to the Company at the
                 offices of the Company exercising the Conversion Right and
                 specifying (i) the total number of shares of Stock the Holder
                 will purchase pursuant to such conversion and (ii) a place and
                 date not less than ten (10) or more than twenty (20) business
                 days from the date of the Conversion Notice for the closing of
                 such purchase.

         (c)     At any closing under Section 13(b) hereof, (i) the Holder will
                 surrender the Warrant and (ii) the Company will deliver to the
                 Holder a certificate or certificates for the number of shares
                 of Company Common Stock issuable upon such conversion, together
                 with cash, in lieu of any fraction of a share, and (iii) the
                 Company will deliver to the Holder a new warrant representing
                 the number of shares, if any, with respect to which the warrant
                 shall not have been exercised.

         (d)     "FAIR MARKET VALUE" of a share of Common Stock as of a
                 particular date (the "DETERMINATION DATE") shall mean:

                                       6.

<PAGE>

                 (i)       If the Company's Common Stock is traded on an
                           exchange or is quoted on the Nasdaq National Market,
                           then the average closing or last sale prices,
                           respectively, reported for the ten (10) business days
                           immediately preceding the Determination Date, and

                 (ii)      If the Company's Common Stock is not traded on an
                           exchange or on the Nasdaq National Market but is
                           traded on the Nasdaq SmallCap Market or other
                           over-the-counter market, then the average of the mean
                           of the closing bid and ask prices reported for the
                           ten (10) business days immediately preceding the
                           Determination Date, and

                 (iii)     If the Company's Common Stock is not traded on an
                           exchange or on the Nasdaq National Market, Nasdaq
                           SmallCap Market or other over-the-counter market,
                           then the price established in good faith by the Board
                           of Directors.

         14.)    Miscellaneous. This Agent's Warrant shall be governed by the
laws of the state of Minnesota without reference to such state's choice of laws
provisions. The headings in this Agent's Warrant are for purposes of convenience
and reference only, and shall not be deemed to constitute a part hereof. Neither
this Agent's Warrant nor any term hereof may be changed, waived, discharged or
terminated orally but only by an instrument in writing signed by the Company and
the registered Holder hereof. All notices and other communications from the
Company to the Holder of this Agent's Warrant shall be by certified mail, return
receipt requested, or by overnight delivery service to the address furnished to
the Company in writing by the last Holder of this Agent's Warrant who shall have
furnished an address to the Company in writing. Delivery shall be deemed to have
occurred on the date three (3) days after depositing the notice in the U.S. mail
or one (1) day after delivery of such notice to a reputable overnight delivery
service.

ISSUED this 20th day of June, 2002.

REDLINE PERFORMANCE PRODUCTS, INC.

 /S/ Kent Harle
________________________________________
     Kent Harle, President and CEO

                                       7.

<PAGE>

                               FORM OF ASSIGNMENT

                       REDLINE PERFORMANCE PRODUCTS, INC.

         FOR VALUE RECEIVED, the undersigned registered owner of this Agent's
Warrant hereby sells, assigns and transfers unto the Assignee named below all of
the rights of the undersigned under the within Agent's Warrant, with respect to
the number of shares of Common Stock set forth below:


<TABLE>
<CAPTION>
NAME OF ASSIGNEE                    ADDRESS                     NUMBER OF SHARES
----------------                    -------                     ----------------
<S>                                 <C>                         <C>
</TABLE>

and does hereby irrevocably constitute and appoint ____________________________
Attorney to make such transfer on the books of REDLINE PERFORMANCE PRODUCTS,
INC. maintained for the purpose, with full power of substitution in the
premises. The undersigned understands that compliance with the provisions of the
Agent's Warrant is necessary to effect any assignment or transfer.

Dated: _____________ ___, _____

___________________________________
Signature

___________________________________
Print Name

                                       8.

<PAGE>

                                  EXERCISE FORM

                       REDLINE PERFORMANCE PRODUCTS, INC.

                 (To be executed only upon exercise of Warrant)

         The undersigned registered owner of this Warrant irrevocably exercises
this Warrant for and purchases _____________________________ of the number of
shares of Common Stock of REDLINE PERFORMANCE PRODUCTS, INC. purchasable with
this Warrant, and herewith makes payment therefore, all at the price and on the
terms and conditions specified in this Warrant.

         The undersigned agrees to deliver a completed and executed
subscription, investment or similar document requested by the Company in
connection with the purchase of shares of Common Stock upon exercise of this
Warrant.

Dated: _____________ ___, _____

___________________________________
Signature of Registered Owner

___________________________________
Street Address

___________________________________
City, State, Zip Code

___________________________________
IRS Identification Number

                                       9.

<PAGE>

                             CASHLESS EXERCISE FORM

                       REDLINE PERFORMANCE PRODUCTS, INC.

        (To be executed upon exercise of Warrant pursuant to Section 13)

         The undersigned hereby irrevocably elects a cashless exercise of the
right of purchase represented by the Warrant for, and to purchase thereunder,
______________ shares of Common Stock, as provided for in Section 13 therein.

         Please issue a certificate or certificates for such Common Stock in the
name of, and pay any cash for any fractional share to:

                                         Name___________________________________
                                              (please print name)

                                         Address________________________________

                                                ________________________________

                                         Social Security No.____________________

                                         Signature______________________________

         NOTE: The above signature should correspond exactly with the name on
the first page of this Warrant or with the name of the assignee appearing in the
Form of Assignment.

         And if said number of shares shall not be all the shares purchasable
under the within Warrant, a new Warrant is to be issued in the name of said
undersigned for the balance remaining of the shares purchasable thereunder
rounded up to the next higher number of shares.

                                      10.

<PAGE>


                       REDLINE PERFORMANCE PRODUCTS, INC.

                           INVESTOR RIGHTS PROVISIONS



              1.) Certain Definitions. Capitalized terms not defined herein
shall have the meanings set forth in the Subscription Agreement and Letter of
Investment Intent between the Company and each purchaser of Units, to which this
Attachment C is attached. In addition, as used in this Attachment C, the
following terms shall have the following respective meanings:

                  "AFFILIATE" means, as to any person, a person that directly or
indirectly, through one or more intermediaries, controls or is controlled by, or
is under common control with, such person. The term "control" means the
possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of a person, whether through the
ownership of voting stock or an equity interest, by contract, or otherwise.

                  "AGENT HOLDERS" shall mean the holders of: (i) Agent Warrants;
and (ii) shares of Common Stock issued upon the exercise of the Agent Warrants.

                  "AGENT WARRANTS" shall mean a class of warrants to purchase
Common Stock, each having the designation "AG-", which warrants were issued as
compensation in connection with the Company's sale of Units.

                  "COMMISSION" shall mean the Securities and Exchange Commission
of the United States or any other U.S. federal agency at the time administering
the Securities Act.

                  "COMMON STOCK" shall mean the Common Stock of the Company.

                  "COMMON STOCK EQUIVALENTS" shall mean the Company's Common
Stock then outstanding plus the shares of Common Stock then issuable upon
conversion of the outstanding Series A Preferred Stock.

                  "COMPANY" shall mean Redline Performance Products, Inc.

                  "EXCHANGE ACT" shall mean the Securities Exchange Act of 1934,
as amended, or any similar United States federal statute and the rules and
regulations of the Commission thereunder, all as the same shall be in effect at
the time.

                  "HOLDER" shall mean each Series A Holder, Agent Holder, and
Unit Warrant Holder.

                  "INDEMNIFIED PARTY" shall have the meaning assigned in Section
7(c) hereof.

                  "INDEMNIFYING PARTY" shall have the meaning assigned in
Section 7(c) hereof.

                  "INITIATING HOLDERS" shall have the meaning assigned in
Section 2(a) hereof.



<PAGE>




                  "IPO" shall mean the closing of the first public offering of
Common Stock of the Company pursuant to a registration statement under the
Securities Act declared effective by the Commission.

                  "MATERIAL ADVERSE INFORMATION" shall have the meaning assigned
in Section 4(b) hereof.

                  "OTHER HOLDERS" shall have the meaning assigned in Section
2(a) hereof.

                  "REGISTRATION EXPENSES" shall mean all expenses, except as
otherwise stated below, incurred by the Company in complying with Sections 2 and
3 hereof, including, without limitation, all registration, qualification and
filing fees, printing expenses, escrow fees, fees and disbursements of counsel
for the Company and blue sky fees and expenses.

                  "REGISTRABLE SECURITIES" shall mean (i) Common Stock issued or
issuable upon conversion of Series A Preferred Stock; (ii) Common Stock issued
or issuable upon exercise of Unit Warrants; (iii) Common Stock issued or
issuable upon exercise of Agent Warrants; and (iv) any shares of Common Stock
issued or issuable in respect of such Common Stock upon any stock split, stock
dividend, recapitalization or similar event. Shares of Common Stock or other
securities shall only be treated as Registrable Securities if they have not been
(A) sold to or through a broker or dealer or underwriter in a public
distribution or a public securities transaction or (B) sold in a transaction
exempt from the registration and prospectus delivery requirements of the
Securities Act so that all transfer restrictions and restrictive legends with
respect thereto are removed upon the consummation of such sale.

                  The terms "REGISTER," "REGISTERED" and "REGISTRATION" refer to
a registration effected by preparing and filing a registration statement in
compliance with the Securities Act, and the declaration or ordering of the
effectiveness of such registration statement by the Commission and such other
governmental or regulatory bodies as are appropriate.

                  "RULE 145 TRANSACTION" shall mean any transaction described in
Rule 145(a) promulgated by the Commission under the Securities Act.

                  "SERIES A PREFERRED STOCK" shall mean the Series A Preferred
Stock of the Company.

                  "SERIES A FINANCING" shall mean the offer and sale by the
Company of Units consisting of shares of Series A Preferred Stock and Unit
Warrants.

                  "SERIES A HOLDERS" shall mean the holders of: (i) Series A
Preferred Stock acquired upon purchase of Units; and (ii) Common Stock issued
upon the conversion of Series A Preferred Stock.

                  "SECURITIES ACT" shall mean the Securities Act of 1933, as
amended, or any similar United States federal statute and the rules and
regulations of the Commission thereunder, all as the same shall be in effect at
the time.


                                       2

<PAGE>




                  "SELLING EXPENSES" shall mean all underwriting discounts,
selling commissions, stock transfer taxes and fees of counsel to Holders
applicable to the securities included in a registration by the Holders.

                  "UNIT WARRANT HOLDERS" shall mean the holders of: (i) Unit
Warrants; and (ii) the Common Stock issued upon exercise of Unit Warrants.

                  "UNIT WARRANTS" shall mean a class of warrants to purchase
Common Stock, each having the designation "AE-", which warrants were issued in
connection with the Company's sale of Units, consisting of shares of the
Company's Series A Preferred Stock and Unit Warrants.

         2.) Requested Registration on Form S-3.

         (a) Request for Registration. Commencing one (1) year after an IPO,
         upon the written request by the Holders of Registrable Securities who
         collectively hold more than 50% of the Registrable Securities (such
         requesting holder or holders referred to as the "INITIATING HOLDERS"),
         provided, that the Company is eligible to use registration Form S-3, or
         a successor form, to effect the requested registration and the
         Registrable Securities included in any such registration have a dollar
         value of not less than $2 million as of the close of business on the
         date on which such request was made, the Company will:

                  (1)      promptly give written notice of the proposed
                           registration, qualification or compliance to all
                           other Holders who are not Initiating Holders; and

                  (2)      as soon as practicable, use its reasonable best
                           efforts to effect such registration, qualification or
                           compliance (including, without limitation,
                           appropriate qualification under applicable blue sky
                           or other state securities laws and appropriate
                           compliance with applicable regulations issued under
                           the Securities Act and any other governmental
                           requirements or regulations) as may be so requested
                           and as would permit or facilitate the sale and
                           distribution of all or such portion of such
                           Registrable Securities as are specified in such
                           request, together with all or such portion of the
                           Registrable Securities of any Holder(s) joining in
                           such request as are specified in a written request
                           received by the Company within twenty (20) days after
                           receipt of such written notice from the Company
                           (collectively, the "OTHER HOLDERS").

         (b) Underwriting. In the event that the Initiating Holders indicate in
         their written request pursuant to Section 2(a) that a registration
         pursuant to this Section 2 is for a registered public offering
         involving an underwriting, the Company shall so advise the Holders as
         part of the notice given pursuant to Section 2(a)(1). In such event,
         the right of any Holder, as the case may be, to registration pursuant
         to this Section 2 shall be conditioned upon such Holder's participation
         in the underwriting arrangements required by this Section 2, and the
         inclusion of such Holder's Registrable Securities in the underwriting
         to the extent requested shall be limited to the extent provided herein.
         The Company shall (together with all Initiating Holders and Other
         Holders proposing to


                                       3
<PAGE>




         distribute their securities through such underwriting) enter into an
         underwriting agreement in customary form with the managing underwriter
         selected by the Company. Notwithstanding any other provision of this
         Section 2, if the managing underwriter advises the Initiating Holders
         in writing that marketing factors require a limitation of the number of
         shares to be underwritten, then the Company shall so advise the
         Initiating Holders and the Other Holders, and the number of shares that
         may be included in the registration and underwriting shall be allocated
         among the Initiating Holders and the Other Holders in proportion, as
         nearly as practicable, to the respective amounts of Registrable
         Securities that such Initiating Holders and Other Holders have
         requested pursuant to Section 2(a) hereof to include in such
         registration. No Registrable Securities or other securities excluded
         from the underwriting by reason of the underwriter's marketing
         limitation shall be included in such registration. To facilitate the
         allocation of shares in accordance with the above provisions, the
         Company or the underwriters may round the number of shares allocated to
         any Initiating Holder or Other Holder to the nearest one hundred (100)
         shares.

         (c) The Company shall not be obligated to take any action to effect any
         such registration, qualification or compliance pursuant to this Section
         2:

                  (1)      During the period starting with the date sixty (60)
                           days prior to the Company's estimated date of filing
                           of any registration statement pertaining to
                           securities of the Company sold by the Company (other
                           than a registration of securities in a Rule 145
                           Transaction or with respect to an employee benefit
                           plan) and ending one hundred eighty (180) days
                           following the effective date of any public offering
                           by the Company of such securities; or

                  (2)      After the Company has effected one (1) registration
                           pursuant to this Section 2, and such registration has
                           been declared or ordered effective.

         (d) The Company shall be entitled to postpone the filing of a
         registration statement pursuant to this Section 2 for a reasonable time
         (not to exceed ninety (90) days) on one occasion during any twelve (12)
         month period if:

                  (1)      Within ten (10) business days after the Company
                           receives a demand notice, the Company shall furnish
                           to the Holders a certificate signed by the President
                           of the Company stating that in the good faith belief
                           of a majority of the Board of Directors, it would be
                           in the best interests of the Company and its
                           stockholders to delay any such registration at that
                           time;

                  (2)      If at any time the Company is subject to the periodic
                           reporting requirements under the Exchange Act, and
                           the Company informs the Holders that it believes that
                           any fact or circumstance concerning the Company
                           exists which, in the good faith judgment of a
                           majority of the Board of Directors, constitutes
                           material information which has not been publicly
                           disclosed and which the Board of Directors believes,
                           in its good faith judgment, is inappropriate or
                           inadvisable so to disclose; or



                                       4

<PAGE>




                  (3)      The Company is engaged in any program for the
                           purchase of shares of Common Stock.

                  (4)      If the Company shall so postpone the filing of a
                           registration statement, the Company promptly shall
                           give the Holders written notice of such postponement,
                           including a statement of the reasons therefore and
                           the expected duration thereof, and the Initiating
                           Holders making the request for demand registration
                           shall have the right to withdraw the request for
                           registration by giving written notice to the Company
                           within fifteen (15) days after receipt of the notice
                           of postponement. If such Holders shall withdraw the
                           request for registration: (A) such registration shall
                           not recommence; and (B) such request shall not be
                           counted as the one (1) registration to which the
                           Holders (taken together as a whole) are entitled
                           under this Section 2.

                  (5)      Subject to the foregoing clauses (1) through (4), the
                           Company shall file a registration statement covering
                           the Registrable Securities so requested to be
                           registered as soon as practicable after receipt of
                           the request or requests of the Initiating Holders.

         3.) Company Registration.

         (a) Notice of Registration. If at any time or from time to time, after
         the date six (6) months after an IPO, the Company shall determine to
         register any of its securities, either for its own account or the
         account of a security holder or holders, other than (i) a registration
         on Form S-8 or a successor form relating solely to employee benefit
         plans (ii) a registration on Form S-4 or a successor form; or (iii) a
         registration relating solely to a Rule 145 Transaction, the Company
         will:

                  (1)      promptly give to each Holder written notice thereof;
                           and

                  (2)      subject to Section 3(b), include in such registration
                           (and any related qualification under blue sky laws or
                           other compliance), and in any underwriting involved
                           therein, all the Registrable Securities specified in
                           a written request or requests, made within twenty
                           (20) days after receipt of such written notice from
                           the Company, by any Holder. If any Holder decides not
                           to include all of its Registrable Securities in such
                           registration, such Holder shall nevertheless continue
                           to have the right to include any Registrable
                           Securities in any subsequent registration statements
                           as may be filed by the Company with respect to
                           offerings of its securities, all upon the terms and
                           conditions set forth herein.

         (b) Underwriting. If the registration of which the Company gives notice
         is for a registered public offering involving an underwriting, the
         Company shall so advise the Holders as a part of the written notice
         given pursuant to Section 3(a)(1). In such event, the right of any
         Holder to registration pursuant to this Section 3 shall be conditioned
         upon such Holder's participation in such underwriting and the inclusion
         of Registrable


                                       5
<PAGE>




         Securities in the underwriting to the extent provided herein. All
         Holders proposing to distribute their securities through such
         underwriting shall, together with the Company, enter into an
         underwriting agreement in customary form with the managing underwriter
         selected for such underwriting by the Company; provided, that no Holder
         shall be liable for indemnification or contribution in a dollar amount
         in excess of the net proceeds such Holder received in such offering.
         Notwithstanding any other provision of this Section 3, if the managing
         underwriter determines that marketing factors require a limitation of
         the number of shares to be underwritten, the managing underwriter may
         limit on a pro rata basis (based on the total number of the Registrable
         Securities entitled to registration held by the Holder) the number of
         Registrable Securities to be included in such registration; provided
         that no such reduction shall be made with respect to securities being
         offered by the Company for its own account. The Company shall advise
         all Holders proposing to distribute their securities through such
         underwriting of any such limitations, and the number of shares of
         Registrable Securities that may be included in the registration. To
         facilitate the allocation of shares in accordance with the above
         provisions, the Company may round the number of shares allocated to any
         Holder proposing to distribute their securities through such
         underwriting to the nearest one hundred (100) shares.

         (c) Right to Terminate Registration. Notwithstanding Section 5(b), the
         Company shall have the right to terminate or withdraw any registration
         initiated by it under this Section 3 prior to or after the
         effectiveness of such registration whether or not any Holder has
         elected to include Registrable Securities in such registration.

         4.) Expenses of Registration.

         (a) The Company shall bear all Registration Expenses incurred in
         connection with all registrations pursuant to Sections 2 and 3 hereof.
         All Selling Expenses relating to securities registered on behalf of the
         Holders shall be borne by the Holders, as the case may be, pro rata on
         the basis of the number of shares so registered.

         (b) Notwithstanding anything herein to the contrary, the Company shall
         not be required to pay (and the Holders shall be required to pay as set
         forth below) for expenses of any registration proceeding begun pursuant
         to Section 2, the request of which has been subsequently withdrawn by
         the Initiating Holders unless (a) the withdrawal is based upon Material
         Adverse Information concerning the Company of which the Initiating
         Holders were not aware at the time of such request or (b) the Holders
         of a majority of Registrable Securities agree to forfeit their right to
         one requested registration pursuant to Section 2 or 3, as the case may
         be, in which event such right shall be forfeited by all Holders. If the
         Holders are required to pay Registration Expenses pursuant hereto, such
         expenses (which shall not be deemed to include (i) the cost of normal
         audits of the Company that would have been performed in any event, or
         (ii) the time of any executive or other personnel of the Company
         involved in the preparation of the registration statement) shall be
         borne by the Holders of securities (including Registrable Securities)
         requesting such registration in proportion to the number of shares for
         which registration was requested. For purposes of this Section 4(b),
         "MATERIAL ADVERSE INFORMATION" shall mean information relating to any
         occurrence that is materially adverse as to the business, properties or
         financial


                                       6
<PAGE>




         condition of the Company, but shall not include information relating to
         the economy or financial markets generally or the Company's industry
         generally.

         5.) Registration Procedures. Whenever the holders of Registrable
Securities have requested that any Registrable Securities be registered as
provided here, the Company shall use its reasonable best efforts to effect the
registration and the sale of such Registrable Securities in accordance with the
intended method of disposition thereof, and pursuant thereto the Company shall
as expeditiously as possible:

         (a) Prepare and file with the Commission a registration statement with
         respect to such Registrable Securities and use its reasonable best
         efforts to cause such registration statement to become effective
         (provided that before filing a registration statement or prospectus or
         any amendments or supplements thereto, the Company shall furnish to the
         counsel selected by the holders of a majority of the Registrable
         Securities covered by such registration statement copies of all such
         documents proposed to be filed, which documents shall be subject to the
         review and comment of such counsel);

         (b) Notify each holder of Registrable Securities of the effectiveness
         of each registration statement filed hereunder and prepare and file
         with the Commission such amendments and supplements to such
         registration statement and the prospectus used in connection therewith
         as may be necessary to keep such registration statement effective for a
         period of not less than one hundred twenty (120) days and comply with
         the provision of the Securities Act with respect to the disposition of
         all securities covered by such registration statement during such
         period in accordance with the intended methods of disposition by the
         sellers thereof set forth in such registration statement;

         (c) Furnish to each seller of Registrable Securities such number of
         copies of such registration statement, each amendment and supplement
         thereto, the prospectus included in such registration statement
         (including each preliminary prospectus) and such other documents as
         such seller may reasonably request in order to facilitate the
         disposition of the Registrable Securities owned by such seller;

         (d) Use its reasonable best efforts to register or qualify such
         Registrable Securities under such other securities or blue sky laws of
         such jurisdictions as any seller reasonably requests and do any and all
         other acts and things which may be reasonably necessary or advisable to
         enable such seller to consummate the disposition in such jurisdictions
         of the Registrable Securities owned by such seller (provided that the
         Company shall not be required to (i) qualify generally to do business
         in any jurisdiction where it would not otherwise be required to qualify
         but for this subparagraph, (ii) subject itself to taxation in any such
         jurisdiction or (iii) consent to general service of process in any such
         jurisdiction);

         (e) Notify each seller of such Registrable Securities, at any time when
         a prospectus relating thereto is required to be delivered under the
         Securities Act, of the happening of any event as a result of which the
         prospectus included in such registration statement contains an untrue
         statement of a material fact or omits any fact necessary to make the
         statements therein not misleading, and, at the request of any such
         seller, the Company


                                       7
<PAGE>




         shall prepare a supplement or amendment to such prospectus so that, as
         thereafter delivered to the purchasers of such Registrable Securities,
         such prospectus shall not contain an untrue statement of a material
         fact or omit to state any fact necessary to make the statements therein
         not misleading;

         (f) Subject to reasonable limits on disclosure, make available for
         inspection by any seller of Registrable Securities, any underwriter
         participating in any disposition pursuant to such registration
         statement and any attorney, accountant or other agent retained by any
         such seller or underwriter, all financial and other records, pertinent
         corporate documents and properties of the Company, and cause the
         Company's officers, directors, employees and independent accountants to
         supply all information reasonably requested by any such seller,
         underwriter, attorney, accountant or agent in connection with such
         registration statement;

         (g) Cause all such Registrable Securities to be listed on each
         securities exchange on which similar securities issued by the Company
         are then listed or, if not then listed and if the registration relates
         to an IPO, cause such Registrable Securities to be included in whatever
         exchange or national automated quotation system the Board of Directors
         determines is appropriate;

         (h) Provide a transfer agent and registrar for all Registrable
         Securities and a CUSIP number for all such Registrable Securities, in
         each case not later than the effective date of such registration;

         (i) Cooperate with the sellers of Registrable Securities and the
         managing underwriter(s), if any, to facilitate the timely preparation
         and delivery of certificates representing the Registrable Securities to
         be sold, without any restrictive legends, in such denominations and
         registered in such names as the managing underwriter(s) may request at
         least two business days prior to any sale thereof to the underwriters,
         if applicable;

         (j) Participate, to the extent reasonably requested by the managing
         underwriter for the offering or the holders of Registrable Securities
         to be sold, in efforts to sell the Registrable Securities under the
         offering (including, without limitation, participating in "roadshow"
         meetings with prospective investors) that would be customary for
         underwritten primary offerings of a comparable percent of equity
         securities by the Company;

         (k) Obtain from its accountants "cold-comfort" letters, dated the
         effective date of the Registration Statement and the date of the
         closing of the sale of the Registrable Securities, and addressed to the
         Company and, subject to such accountant's reasonable discretion, to the
         selling Holders, in form and substance as are customarily issued in
         connection with underwritten public offerings;

         (l) Obtain from its counsel an opinion, addressed to the selling
         Holders, with respect to the offering in form and substance as are
         customarily issued in connection with comparable offerings;



                                       8

<PAGE>




         (m) Use its reasonable best efforts to cause such Registrable
         Securities covered by such registration statement to be registered with
         or approved by such other governmental agencies or authorities as may
         be necessary to enable the sellers thereof to consummate the
         disposition of such Registrable Securities; and

         (n) Take such other actions as the underwriters, if any, reasonably
         request in order to expedite or facilitate the disposition of such
         Registrable Securities.

         6.) Additional Provisions.

         (a) Information by Holder. The Holders of Registrable Securities
         included in any registration shall furnish to the Company such
         information, including information regarding such Holders, the
         Registrable Securities held by them and the distribution proposed, as
         the Company may request in writing to enable the Company to comply with
         the provisions hereof in connection with any registration,
         qualification or compliance referred to herein.

         (b) Termination. All rights granted and obligations imposed pursuant to
         Sections 2 and 3 shall terminate (i) as to all Holders on the earlier
         of three (3) years after the date of an IPO or (ii) as to each Holder,
         as the case may be, at such time as such Holder (together with such
         Holder's Affiliates) holds less than one percent (1%) of the Company's
         outstanding capital stock (if applicable, on an
         as-converted-to-Common-Stock basis) and such Holder can sell all of
         such Holder's Registrable Securities pursuant to Rule 144(k) or
         pursuant to Rule 144 under the Securities Act within any three (3)
         month period.

         (c) Market Standoff. Each holder of Registrable Securities shall not
         effect any public sale or distribution (including sales pursuant to
         Rule 144) of equity securities of the Company, or any securities
         convertible into or exchangeable or exercisable for such securities,
         during the seven (7) days prior to and the ninety (90) day period
         beginning on the effective date of any underwritten registration
         pursuant to Section 2 or any underwritten Company registration in which
         Registrable Securities are included (except as part of such
         underwritten registration), unless the underwriters managing the
         registered public offering otherwise agree.

         (d) Suspension of Disposition. The Holders agree that upon receipt of
         any notice from the Company of any material event, the Holders will
         discontinue disposition of any Registrable Securities pursuant to the
         registration statement covering such Registrable Security until the
         Holders receipt of the copies of the supplemented or amended
         prospectus, and if so directed by the Company, the Holders would
         deliver to the Company all copies, then and there possessed, of any
         prospectus covering such Registrable Securities current at the time of
         receipt of such notice, other than permanent file copies. If the
         Company shall give any such notice, the period set forth in Section
         5(b) shall be extended by the number of days during the period from and
         including the date of the giving of such notice to and including the
         date when Holders shall have received the copies of the supplemented or
         amended prospectus contemplated herein.


                                       9

<PAGE>




         (e) Limitations on Subsequent Registration Rights. The Company shall
         not, without the prior written consent of Holders who collectively hold
         at least a majority of the Registrable Securities, enter into any
         agreement (except as provided herein) with any holder or prospective
         holder of any securities of the Company which would allow such holder
         or prospective holder to include securities of the Company in any
         registration filed under Section 2 or 3, unless, under the terms of
         such agreement, such holder or prospective holder may include such
         securities in any such registration only on terms substantially similar
         to the terms on which holders of Registrable Securities may include
         shares in such registration.

         7.) Indemnification.

         (a) By Company. The Company will indemnify each Holder, with respect to
         each registration, qualification or compliance which has been effected
         pursuant to Section 2 or 3 hereof to this Attachment C, against all
         expenses, claims, losses, damages or liabilities (or actions in respect
         thereof), including any of the foregoing incurred in settlement of any
         litigation, commenced or threatened, arising out of or based on any
         untrue statement (or alleged untrue statement) of a material fact
         contained in any registration statement, prospectus, offering circular
         or other document, or any amendment or supplement thereto, incident to
         any such registration, qualification or compliance, or based on any
         omission (or alleged omission) to state therein a material fact
         required to be stated therein or necessary to make the statements
         therein, in light of the circumstances in which they were made, not
         misleading, for any legal and any other expenses reasonably incurred in
         connection with investigating, preparing or defending any such claim,
         loss, damage, liability or action, provided that the Company will not
         be liable in any such case to the extent that any such claim, loss,
         damage, liability or expense arises out of or is based on any untrue
         statement or omission or alleged untrue statement or omission, made in
         reliance upon and in conformity with information furnished to the
         Company for use in connection with such registration by such Holder,
         controlling person or underwriter. If the Holders are represented by
         counsel other than counsel for the Company, the Company will not be
         obligated under this Section 7(a) to reimburse legal fees and expenses
         of more than one separate counsel for the Holders.

         (b) By Holders. Each Holder will, if Registrable Securities held by
         such Holder are included in the securities as to which such
         registration, qualification or compliance is being effected, indemnify
         the Company, each of its directors and officers and its legal counsel
         and independent accountants, each underwriter, if any, of the Company's
         securities covered by such a registration statement, each person who
         controls the Company or such underwriter within the meaning of Section
         15 of the Securities Act, and each other such Holder, each of their
         officers and directors and each person controlling such Holder or
         within the meaning of Section 15 of the Securities Act, against all
         claims, losses, damages and liabilities (or actions in respect thereof)
         arising out of or based on any untrue statement (or alleged untrue
         statement) of a material fact contained in any such registration
         statement, prospectus, offering circular or other document, or any
         omission (or alleged omission) to state therein a material fact
         required to be stated therein or necessary to make the statements
         therein, in light of the circumstances in which they were made, not
         misleading, and will reimburse the Company, such Holders, such



                                       10
<PAGE>




         directors, officers, legal counsel, independent accountants, persons,
         underwriters or controlling persons for any legal or any other expenses
         reasonably incurred in connection with investigating or defending any
         such claim, loss, damage, liability or action, in each case to the
         extent, but only to the extent, that such untrue statement (or alleged
         untrue statement) or omission (or alleged omission) is made in such
         registration statement, prospectus, offering circular or other document
         in reliance upon and in conformity with information furnished to the
         Company for use in connection with such registration by such Holder, as
         the case may be.

         (c) Procedures. Each party entitled to indemnification under this
         Section 7 (the "INDEMNIFIED PARTY") shall give notice to the party
         required to provide indemnification (the "INDEMNIFYING PARTY") promptly
         after such Indemnified Party has actual knowledge of any claim as to
         which indemnity may be sought, and shall permit the Indemnifying Party
         to assume the defense of any such claim or any litigation resulting
         therefrom, provided that counsel for the Indemnifying Party, who shall
         conduct the defense of such claim or litigation, shall be approved by
         the Indemnified Party (whose approval shall not unreasonably be
         withheld), and the Indemnified Party may participate in such defense at
         its own expense, provided, however, that the failure of any Indemnified
         Party to give notice as provided herein shall not relieve the
         Indemnifying Party of its obligations under this Attachment C unless
         the failure to give such notice is prejudicial to an Indemnifying
         Party's ability to defend such action. No Indemnifying Party, in the
         defense of any such claim or litigation, shall, except with the consent
         of each Indemnified Party, consent to entry of any judgment or enter
         into any settlement which does not include as an unconditional term
         thereof the giving by the claimant or plaintiff to such Indemnified
         Party of a release from all liability in respect to such claim or
         litigation.

         8.) Information Rights.

         (a) Delivery of Information. The Company shall deliver to each Holder,
         as soon as practicable, but in any event within one hundred twenty
         (120) days after the end of each fiscal year of the Company, an income
         statement for such fiscal year, a balance sheet of the Company as of
         the end of such year, and a schedule as to the sources and applications
         of funds for such year, such year-end financial reports to be in
         reasonable detail, prepared in accordance with generally accepted
         accounting principles, and audited and certified by independent public
         accountants selected by the Company. The Company shall also deliver to
         each Holder within sixty (60) days after the end of each quarter, an
         unaudited income statement and balance sheet for and as of the end of
         such quarter.

         (b) Termination of Information Covenants. The covenants set forth in
         this Section 8 shall terminate as to each Holder and be of no further
         force or effect immediately upon the Company becoming a reporting
         company under the Exchange Act.

         (c) Confidentiality of Information. Each Holder agrees that any
         information obtained by such Holder pursuant to this Section 8 which
         is, or would reasonably be perceived to be, proprietary to the Company
         or otherwise confidential will not be disclosed without the prior
         written consent of the Company. Each Holder further acknowledges and
         understands that any information so obtained which may be considered
         material


                                       11
<PAGE>




         non-public information will not be utilized by such Holder in
         connection with purchases and/or sales of the Company's securities
         except in compliance with applicable state and federal antifraud
         statutes.

         9.) Amendments. Any term included in this Attachment C may be amended
and the observance of any term of this Attachment C may be waived only with the
written consent of the Company and the holders of more than 50% of the
Registrable Securities. Any amendment or waiver effected in accordance with this
Section will be binding upon the Company and each holder of securities in to
which such securities are convertible, and any future holders of such
securities. Any holder of securities subject to this Attachment C may waive its
rights hereunder without obtaining the consent of any other person.

         10.) Rule 144 Requirements. During such time as a class of the
Company's securities is registered under Section 12 of the Exchange Act, the
Company agrees to use reasonable efforts to:

         (a) Comply with the requirements of Rule 144(c) under the Securities
         Act with respect to current public information about the Company;

         (b) File with the Commission in a timely manner all reports and other
         documents required of the Company under the Securities Act and the
         Exchange Act; and

         (c) Furnish to any holder of Registrable Securities upon request (i) a
         written statement by the Company as to its compliance with the
         requirements of said Rule 144(c), and the reporting requirements of the
         Securities Act and the Exchange Act and (ii) a copy of the most recent
         annual or quarterly report of the Company.

         11.) Transfer of Registration Rights. The rights to cause the Company
to register Registrable Securities as provided herein may be transferred by any
Holder in any transfer of the Registrable Securities to a transferee; provided,
that the Company is given written notice by such Holder of Registrable
Securities at the time of the said transfer stating the name and address of said
transferee and identifying the securities with respect to which such
registration rights are being transferred, that said transferee agrees in
writing to be bound by the provisions set forth herein.


                                       12