|  | (a) | Incorporation.  The      Company is a corporation duly organized, validly existing and in good      standing under the laws of the State of  Delaware. |
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|  | (b) | Capitalization.  The      authorized capital stock of the Company is 1,000,000,000 shares of Common      Stock ("Common Stock"), par value $0.00001 per Share.  There are      no authorized or outstanding shares of preferred stock.  As of      January 5, 2009, there are 32,467,484 shares of Common Stock issued and      outstanding. |
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|  | (c) | Shares.  The      Shares, when issued, sold, and delivered in accordance with the terms of      this Agreement, will be duly and validly issued, fully paid, and      nonassessable.  All corporate action required to be taken by or      on behalf of the Company to authorize the Company to enter into and carry      out this Agreement, and for the authorization, issuance and delivery of      the Shares has been duly and properlytaken. |
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|  | (d) | Private Placement      Memorandum.  Except as set forth below and in the      Company's Confidential Private Placement Memorandum dated January 15, 2009      ("Private Placement Memorandum"), neither the Company nor any of its      agents or representatives has made any agreements or taken any actions      which may cause anyone to be entitled to a commission or a finder's fee as      a result of the execution, delivery or performance of this Agreement or      consummation of the transactions contemplated  hereby. |
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|  | (e) | Securities Act of      1933.  Based in material part upon the representations      herein of the Purchaser, the Company has complied and will comply with all      applicable federal and state securities laws in connection with the offer,      issuance and sale of the Shares hereunder.  Neither the Company      nor anyone acting on its behalf, directly or indirectly, has or will sell,      offer to sell or solicit offers to buy any of the Shares or similar      securities to, or solicit offers with respect thereto from, or enter into      any negotiations relating thereto with, any person, or has taken or will      take any action so as to bring the issuance and sale of any of the Shares      under the registration provisions of the Securities Act and applicable      state securities laws, and neither the Company nor any of its affiliates,      nor any person acting on its or their behalf, has engaged in an form of      general solicitation or general advertising (within the meaning of      Regulation D under the Securities Act) in connection with the offer or      sale of any of the Shares. |
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|  | (f) | Proceeds.  The      Company shall use the net proceeds of the Purchase Price to be received      from Purchaser as specified in "Use of Proceeds" in the Private Placement      Memorandum. |
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|  | (g) | No      Litigation.  To the knowledge of the Company, there is no      litigation or proceeding or investigation pending or threatened against      the Company in any federal, state or local court, or before any      administrative agency or arbitrator, or before any other tribunal duly      authorized to resolve disputes, which seeks to enjoin or prohibit, or      otherwise questions the validity of, the sale of Shares under this      Agreement.  The Company completed a rescission offer with the      purchasers of its Common Stock in the Company's Regulation E offering      under the Securities Act that was conducted in 2004 and 2005 because      certain State filings were not made when that offering was      conducted.  The rescission offer is described in the Private      Placement Memorandum. |
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|  | (h) | Placement      Agents.  Except for John W. Loofbourrow Associates, Inc.      ("JWL") and EquitySmith, Inc. ("ESI"), pursuant to the terms of a      placement agent agreement dated January 16, 2009 between the Company, JWL,      and ESI ("Placement Agent Agreement"), the Company has not employed any      broker or finder or incurred any liability for any brokerage, placement,      commissions, finders' fees, advisory fees or other similar fees in      connection with the sale of Shares. |
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|  | (a) | Organization and      Standing of the Purchaser.  Purchaser is a corporation,      limited liability company or partnership duly incorporated or organized,      validly existing and in good standing under the laws of the jurisdiction      of its incorporation ororganization. |
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|  | (b) | Authorization and      Power.  Purchaser has the requisite power and authority      to enter into and perform this Agreement and to purchase Shares being sold      to it hereunder.  The execution, delivery and performance of      this Agreement by Purchaser and the consummation by it of the transactions      contemplated hereby have been duly authorized by all necessary corporate      or partnership action, and no further consent or authorization of      Purchaser or its Board of Directors, stockholders, or partners, as the      case may be, is required.  When executed and delivered by the      Purchaser, this Agreement shall constitute the valid and binding      obligation of Purchaser enforceable against Purchaser in accordance with      its terms, except as such enforceability may be limited by applicable      bankruptcy, insolvency, reorganization, moratorium, liquidation,      conservatorship, receivership or similar laws relating to, or affecting      generally the enforcement of, creditor's rights and remedies or by other      equitable principles of generalapplication. |
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|  | (c) | No      Conflict.  The execution, delivery and performance of      this Agreement by Purchaser and the consummation by Purchaser of the      transactions contemplated thereby and hereby do not and will not (i)      violate any provision of the Purchaser's charter or organization      documents, (ii) conflict with, or constitute a default (or an event which      with notice or lapse of time or both would become a default under), or      give to others any rights of termination, amendment, acceleration or      cancellation of, any agreement, mortgage, deed of trust, indenture, note,      bond, license, lease agreement, instrument or obligation to which the      Purchaser is a party or by which the Purchaser's properties or assets are      bound, or (iii) result in a violation of any federal, state, local or      foreign statute, rule, regulation, order, judgment or decree (including      federal and state securities laws and regulations) applicable to the      Purchaser or by which any property or asset of the Purchaser are bound or      affected, except, in all cases, other than violations pursuant to clauses      (i) or (iii) (with respect to federal and state securities laws) above,      except, for such conflicts, defaults, terminations, amendments,      acceleration, cancellations and violations as would not, individually or      in the aggregate, materially and adversely affect the Purchaser's ability      to perform its obligations under thisAgreement. |
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|  | (d) | Acquisition for      Investment.  Purchaser is purchasing the Shares solely      for its own account and not with a view to or for sale in connection with      distribution.  Purchaser does not have a present intention to      sell any of the Shares, nor a present arrangement (whether or not legally      binding) or intention to effect any distribution of any of the Shares to      or through any person or entity; provided, however, that      by making the representations herein, Purchaser does not agree to hold the      Shares for any minimum or other specific term and reserves the right to      dispose of the Shares at any time in accordance with Federal and state      securities laws applicable to such disposition.  Purchaser      acknowledges that it (i) has such knowledge and experience in financial      and business matters such that Purchaser is capable of evaluating the      merits and risks of Purchaser's investment in the Company, (ii) is able to      bear the financial risks associated with an investment in the Shares and      (iii) has been given full access to such records of the Company and the      Subsidiaries and to the officers of the Company and the Subsidiaries as it      has deemed necessary or appropriate to conduct its due diligence      investigation. |
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|  | (e) | Rule 144A; Rule      144.  Each Purchaser understands that the Shares must be      held indefinitely unless such Shares are registered under the Securities      Act or an exemption from registration is available.  Purchaser      acknowledges that it is familiar with Rules 144A and 144 of the rules and      regulations of the Commission, as amended, promulgated pursuant to the      Securities Act ("Rules"), and that Purchaser has been advised that the      Rules permit resales only under certain      circumstances.  Purchaser understands that to the extent that      Rule 144A or 144 is not available, Purchaser will be unable to sell any      Shares without either registration under the Securities Act or the      existence of another exemption from such registration      requirement. |
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|  | (f) | General.  Purchaser      understands that the Shares are being offered and sold in reliance on a      transactional exemption from the registration requirements of federal and      state securities laws and the Company is relying upon the truth and      accuracy of the representations, warranties, agreements, acknowledgements      and understandings of Purchaser set forth herein in order to determine the      applicability of such exemptions and the suitability of Purchaser to      acquire the Shares.  Purchaser understands that no United States      federal or state agency or any government or governmental agency has      passed upon or made any recommendation or endorsement of the      Shares. |
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|  | (g) | No General      Solicitation.  Purchaser acknowledges that the Shares      were not offered to Purchaser by means of any form of general or public      solicitation or general advertising, or publicly disseminated      advertisements or sales literature, including (i) any advertisement,      article, notice or other communication published in any newspaper,      magazine, or similar media, or broadcast over television or radio, or (ii)      any seminar or meeting to which Purchaser was invited by any of the      foregoing means of communications.  Purchaser, in making the      decision to purchase the Shares, has relied upon independent investigation      made by it and has not relied on any information or representations made      by third parties. |
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|  | (h) | Accredited Investor;      Qualified Institutional Investor.  Purchaser is an      "accredited investor" (as defined in Rule 501 of Regulation D), and a      "qualified institutional buyer" ("QIB") as defined under Rule 144A of the      Securities Act, and Purchaser has such experience in business and      financial matters that it is capable of evaluating the merits and risks of      an investment in the Shares.  Purchaser acknowledges that an      investment in the Shares is speculative and involves a high degree of      risk. |
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|  | (i) | Certain      Fees.  Purchaser has not employed any broker or finder or      incurred any liability for any brokerage or investment banking fees,      placement, commissions, finders' structuring fees, financial advisory fees      or other similar fees in connection with this  Agreement. |
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|  | (j) | No      Shorting.  Purchaser has not engaged in any short sales      of any shares of Common Stock of the Company or instructed any third      parties to engage in any short sales of securities of the Company on its      behalf prior to the closing date.  Purchaser covenants and      agrees that at closing it will not be in a net short position with respect      to the shares of Common Stock. |
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|  | (k) | Information;      Risks. The Purchaser has      had an opportunity to discuss the Company’s business, management, and      financial affairs with management of the Company and has been supplied      with all documents, records, financial statements, books and other      information which the Purchaser has requested pertaining to the Company      and its activities and an investment in the Company, including but not      limited to the Private Placement Memorandum, a copy of which is attached      hereto as Exhibit      A and incorporated herein.  The Purchaser has evaluated      and understands the risks of (including, but not limited to, the Risk      Factors described in the Private Placement Memorandum), and other      considerations relating to, a purchase of the Shares.  The      Purchaser has been afforded the opportunity to obtain any additional      information necessary to verify the accuracy of any representations of the      Company made herein or information provided to the      Purchaser.  The Purchaser confirms that, in making its, decision      to invest in the Shares, it has relied upon its own independent      investigation or that made by its agents, representatives and professional      advisors, and it and such agents, representatives and professional      advisors have been given the opportunity to ask questions of, and to      receive answers from, persons acting on behalf of the Company concerning      the Company and its activities and all other matters relating to the      operation of the Company and this investment.  The Purchaser has      such knowledge and experience in financial and business matters that it is      capable of evaluating the merits and risks of the investment represented      by the Shares, and it is able to bear the economic risk of such investment      including, without limitation, the risk that such investment might be held      indefinitely by it and the risk of complete loss of the      investment.  The Purchaser has adequate net worth to sustain a      complete loss of its investment in the Company and has no need for      liquidity in its investment. |
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|  | (l) | Qualified      Institutional Buyer ("QIB") Under Rule  144A. |
|--|-----|--------------------------------------------------------------|

|  | (m) | Accredited      Investor.  [Fill in if applicable.]  The      Purchaser confirms that it is an Accredited Investor, as defined in Rule      501 of the Securities Act, by reason of meeting any one of the following      conditions (please initial each paragraph that is    applicable): |
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|        | (i)    | is      a natural person whose individual net worth, or joint net worth with his      or her spouse, as of the date of the purchase hereunder, exceeds      $1,000,000; |
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|   |   |  ______                                                                                                                                                            |

|        | (ii)   | is      a natural person who had an individual income in excess of $200,000 in      each of the two most recent years or joint income with his or her spouse      in excess of $300,000 in each of the two most recent years and has a      reasonable expectation of reaching the same income level in the current      year; |
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|   |   |  ______                                                                                                                                                                                                                                                                                                                   |

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|  | (iii) | is      (a) a bank, as defined in Section 3 (a)(2) of the Securities Act, or a      savings and loan association or other institution, as defined in Section 3      (a)(5)(A) of the Securities Act, whether acting in its individual or      fiduciary capacity; (b) a broker dealer registered pursuant to      Section 15 of the Securities Exchange Act of 1934, as amended; (c) an      insurance company as defined in Section 2 (a)(13) of the Securities      Act; (d) an investment company registered under the Investment Company Act      of 1940 or a business development company as defined in Section 2      (a)(48) of the Investment Company Act of 1940; (e) a small business      investment company licensed by the U.S. Small Business Administration      under Section 301 (c) or (d) of the Small Business Investment      Act of 1958; (f) a plan established and maintained by a state, its      political subdivisions, or any agency or instrumentality of a state or its      political subdivisions, for the benefit of its employees, if such plan has      total assets in excess of US $5,000,000; or (g) an employee benefit      plan within the meaning of Title I of the U.S. Employee      Retirement Income Security Act of 1974, if the investment decision is made      by a plan fiduciary, as defined in Section 3 (21) of such act, which      is either a bank, savings and loan association, insurance company, or      registered investment adviser, or if the employee benefit plan has total      assets in excess of US $5,000,000 or, if a self-directed plan, with      investment decisions made solely by persons that are accredited      investors; |
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|  | (iv) | is      a private business development company as defined in Section 202      (a)(22) of the U.S. Investment Advisors Act of 1940, as      amended; |
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|  | (v) | is      an organization described in Section 501 (c)(3) of the U.S. Internal      Revenue Code, or a corporation, Massachusetts or similar business trust,      or partnership, not formed for the specific purpose of acquiring the      Shares offered, with total assets of  US $5,000,000; |
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|  | (vi) | is      a director or executive officer of theCompany; |
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|  | (vii) | is      a trust with total assets in excess of US $5,000,000, not formed for      the specific purpose of acquiring the Shares offered, whose purchase is      directed by a person who, either alone or together with its, his or her      purchaser representative(s), has such knowledge and experience in      financial and business matters that such person is capable of evaluating      the merits and risks of the prospective  investment; |
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|  | (viii) | is      an entity (i.e., partnership, corporation, unincorporated association or      trust) in which all of the equity owners qualify individually as      Accredited Investors under the paragraphs set forth above.  An      entity can qualify under this paragraph even if newly formed for the      purpose of investing in theCompany. |
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|  | (n) | The      Purchaser understands that the Company is relying on the truth and      accuracy of the representations, covenants, and warranties herein made by      the Purchaser in offering the Shares to the Purchaser without having first      registered the Shares under the Securities Act or other applicable      securities laws. |
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|  | (o) | Neither      the Purchaser nor any of its agents or representatives has made any      agreements or taken any actions, which may cause anyone to be entitled to      a commission or a finder's or broker’s fee as a result of the execution,      delivery or performance of this Agreement or consummation of the      transactions contemplated hereby. |
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|  | (a) | If      to the Company: |
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|  | (b) | If      to the Purchaser: |
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|   | BLACKHAWK      CAPITALGROUP      BDC, INC. |                                                                   |
|--------|--------------------------------------------|------------------------------------------------------------------------|
|   |                                       |                                                         |   |
|   | By:                                        | /s/ Craig      A. Zabala                                          |   |
|   |                                       | Dr.      Craig A. ZabalaPresident      and ChiefExecutive      Officer |   |

|   | EquitySmith,      Inc. |                                                                  |
|--------|------------------------|-----------------------------------------------------------------------|
|   |                   |                                                        |   |
|   | By:                    | /s/ Hugo      A. Delgado, Jr.                                    |   |
|   |                   | Hugo      A. Delgado, Jr.President      & Chief Executive Officer |   |

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