ex10-1.htm


    Exhibit 10.1


     

    PURCHASE
AND SHARE EXCHANGE AGREEMENT

     

     

    THIS
AGREEMENT is made effective as of the 21st day of January
2010.

     

    AMONG:

     

    CATALYST GROUP HOLDING INCORPORATED,
f/k/a Pop Starz Ventures 3, Inc.  a Delaware corporation,
located at  1201 Hays Street, Tallahassee, Florida  32301
(“Catalyst”)

     

    AND:

     

    Real Estate Promotional Services,
Inc., a Florida corporation located at 334 E. Campbell Ave.
 (“Company”),

     

    AND:

     

    Jeff Crowe  (“Selling Shareholder”)

     

    WHEREAS:

     

    
      	
              A.  

            	
              Catalyst  will
      acquire all of the issued and outstanding shares of common stock
      of  Company as more fully set forth herein;
  and

            


    

     

    
      	
              B.  

            	
              The
      Selling Shareholders  are the registered and beneficial owners
      of all of the issued and outstanding shares of the Company’s common stock(
      “ Common Stock” or “Company
Shares”);

            


    

     

    NOW THEREFORE, in
consideration of the mutual covenants and agreements herein contained and other
good and valuable consideration (the receipt and sufficiency of which are hereby
acknowledged), the parties covenant and agree as follows:

     

    
      	
               
      

            	
              DEFINITIONS

            


    

     

    
      	
               
      

            	
              Definitions

            


    

     

    1.1          The
following terms have the following meanings, unless the context indicates
otherwise:

     

    
      	
               
      

            	
              “Agreement” shall mean
      this Agreement, and all the exhibits, schedules and other documents
      attached to or referred to in this Agreement, and all amendments and
      supplements, if any, to this
Agreement;

            


    

     

    
      	
               
      

            	
              “Closing” shall mean the
      completion of the Transaction, in accordance with this Agreement
      ,  which the Closing Documents shall be exchanged by the
      parties, except for those documents or other items specifically required
      to be exchanged at a later time;

            


    

     

    
      	
               
      

            	
              “Closing Date” shall mean
      a date mutually agreed upon by the parties hereto in writing and subject
      to the satisfaction or waiver by Catalyst, the Selling Shareholders and
      the Company of the conditions precedent set out in Sections 5 and 6
      respectively;

            


    

     

    
      
        
        

      

      
        -1-

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              “Closing Documents” shall
      mean the papers, instruments and documents required to be executed and
      delivered at the Closing pursuant to this
  Agreement;

            


    

     

    “Company” shall mean Real
Estate Promotional Services, Inc., any predecessor entity,
including  but not limited to any predecessor entity including those
assets and business operations of Real Estate Promotions and the business
operations of the Selling Shareholder.

     

    
      	
               
      

            	
              “Convertible
      Debenture”  shall mean the  instrument to be
      executed by Catalyst in consideration for the purchase of the Common
      Stock.

            


    

     

    
      	
               
      

            	
              “Common
      Stock”  refers to all of the issued and outstanding
      equity securities of the Company.  Also referred to as “Company
      Shares”

            


    

     

    
      	
               
      

            	
              “Exchange Act” shall mean
      the United States Securities Exchange Act of 1934, as
    amended;

            


    

     

    
      	
               
      

            	
              “GAAP” shall mean United
      States generally accepted accounting principles applied in a manner
      consistent with prior periods;

            


    

     

    
      	
               
      

            	
              “Liabilities” shall
      include any direct or indirect indebtedness, guaranty, endorsement, claim,
      loss, damage, deficiency, cost, expense, obligation or responsibility,
      fixed or unfixed, known or unknown, asserted choate or inchoate,
      liquidated or unliquidated, secured or
  unsecured;

            


    

     

    
      	
               
      

            	
              “Selling Shareholder”
      are those shareholders set forth on Schedule 1 executing this
      Agreement as may be amended time to time prior to
  Closing

            


    

     

    
      	
               
      

            	
              “Shareholders” are those
      shareholders set forth on Schedule 1 owning all of the outstanding equity
      securities of Company.

            


    

     

    
      	
               
      

            	
               “SEC” shall mean the
      Securities and Exchange Commission;

            


    

     

    
      	
               
      

            	
              “Securities Act” shall
      mean the United States Securities Act of 1933, as
  amended;

            


    

     

    
      	
               
      

            	
              “Taxes” shall include
      international, federal, state, provincial and local income taxes, capital
      gains tax, value-added taxes, franchise, personal property and real
      property taxes, levies, assessments, tariffs, duties (including any
      customs duty), business license or other fees, sales, use and any other
      taxes relating to the assets of the designated party or the business of
      the designated party for all periods up to and including the Closing Date,
      together with any related charge or amount, including interest, fines,
      penalties and additions to tax, if any, arising out of tax assessments;
      and

            


    

     

    
      	
               
      

            	
              “Transaction” shall mean
      the purchase of the Company Shares by Catalyst  from the Selling
      Shareholders in consideration for the payment of the Purchase
      Price.

            


    

     

    
      	
               
      

            	
              “Purchase Price” shall
      mean the sum of $250,000

            


    

     

    
      
        
        

      

      
        -2-

        
          

        

      

      
        
        

      

    

     

    
      	
            	
              1.2

            	Schedules


    

     

    The
following schedules are attached to and form part of this Agreement

     

    Schedule
1                      List
of Shareholders and Outstanding securities

     

    Schedule
2                      Financial
Statements

     

    Schedule
3                      Convertible
Debenture

     

    
      	
              
                2.

              

            	
              THE
      OFFER, PURCHASE AND SALE OF SHARES

            


    

     

    
      	 	
              2.1

            	
              Offer,
      Purchase and Sale of the Common
Stock.

            


    

     

    Subject to the terms and conditions of
this Agreement, the Selling Shareholders hereby covenant and agree to sell,
assign and transfer to Catalyst, and Catalyst  hereby covenants and
agrees to purchase from the Selling Shareholders the Common Stock held by the
Selling Shareholders.

     

    
      	 	
              2.2

            	
              Consideration

            


    

     

    As consideration for the sale of the
Company Shares by the Selling Shareholders to Catalyst , Catalyst shall issue
a  Convertible Debenture in the amount of $250,000 to the
Shareholder.     (Schedule 3)

     

    
      	 	
              2.3

            	
              Share
      Exchange Procedure and
Representations

            


    

     

    The Selling Shareholder shall deliver
the Company Shares to Catalyst duly endorsed and duly executed and endorsed in
blank (or accompanied by duly executed stock power duly endorsed in blank), in
each case in proper form for transfer, with signatures guaranteed,
and, if applicable, with all stock transfer and any other required documentary
stamps affixed thereto and with appropriate instructions to allow the transfer
agent to issue certificates for the Catalyst Shares to the holder
thereof.

     

    2.4           Operations Pending
Closing

     

    In order to ensure the continued
operations of the Company and to insure the ongoing business operations of the
Company,  immediately upon execution of this
Agreement,  Catalyst shall have the right,  but not the
obligation,  to designate the chief financial officer and a director
of the Company.   Said designee shall have the
rights  to manage the Company’s financial operations, contractual
commitments,  funding and banking requirements.

     

                   
2.5           Closing
Date

     

    The Closing will take place, subject to
the terms and conditions of this Agreement, on the Closing Date.

     

    3.           REPRESENTATIONS
AND WARRANTIES OF COMPANY AND THE  SELLING SHAREHOLDER

     

    As of the Closing, Company and the
Selling Shareholder, jointly and severally, represent and warrant to Catalyst,
and acknowledge that Catalyst is relying upon such representations and
warranties, in connection with the execution, delivery and performance of this
Agreement, notwithstanding any investigation made by or on behalf of Catalyst,
as follows:

     

    
      
        
        

      

      
        -3-

        
          

        

      

      
        
        

      

    

     

    
      	 	
              3.1

            	
              Organization
      and Good Standing

            


    

     

    Company is a corporation duly
organized, validly existing and in good standing under the laws of the state of
Florida and has the requisite corporate Company and authority to own, lease and
to carry on its business as now being conducted.  Company is duly
qualified to do business and is in good standing as a corporation in each of the
jurisdictions in which Company owns property, leases property, does business, or
is otherwise required to do so, where the failure to be so qualified would have
a material adverse effect on the business of Company taken as a
whole.

     

    3.2           Authority

     

    Company has all requisite corporate
Company and authority to execute and deliver this Agreement and any other
document contemplated by this Agreement (collectively, the “Company Documents”) to be
signed by Company and to perform its obligations hereunder and to consummate the
transactions contemplated hereby.  The execution and delivery of each
of the Company Documents by Company and the consummation of the transactions
contemplated hereby have been duly authorized by Company’s board of
directors.  No other corporate or shareholder proceedings on the part
of Company is necessary to authorize such documents or to consummate the
transactions contemplated hereby.  This Agreement has been, and the
other Company Documents when executed and delivered by Company as contemplated
by this Agreement will be, duly executed and delivered by Company and this
Agreement is, and the other Company Documents when executed and delivered by
Company as contemplated hereby will be, valid and binding obligations of Company
enforceable in accordance with their respective terms except:

     

    
      	
              (a)  

            	
              as
      limited by applicable bankruptcy, insolvency, reorganization, moratorium,
      and other laws of general application affecting enforcement of creditors’
      rights generally;

            


    

     

    
      	
              (b)  

            	
              as
      limited by laws relating to the availability of specific performance,
      injunctive relief, or other equitable remedies;
  and

            


    

     

    
      	
              (c)  

            	
              as
      limited by public policy.

            


    

     

    
      	 	
              3.3

            	
              Capitalization
      of Company

            


    

     

               As
of the date of this Agreement, and as of the Closing Date, all of the issued and
outstanding shares of the Company’s Common Stock  or
other  securities of Company  will have been duly
authorized, are validly issued, were not issued in violation of any pre-emptive
rights and are fully paid and non-assessable, are not subject to pre-emptive
rights and were issued in full compliance with the laws of the state of
Florida.   There are no agreements purporting to restrict the
transfer of the Company Shares,  no voting agreements, shareholders’
agreements, voting trusts, or other arrangements restricting or affecting the
voting of the Company Shares.  Except as set forth on Schedule 1,
there are, and will not be at Closing,  any equity securities issued
or issuable or other securities which can be converted into any class
of  equity securities of Company.

     

    3.4           Title
and Authority of Selling Shareholders

     

    Each of the Selling Shareholders is and
will be as of the Closing, the registered and beneficial owner of and will have
good and marketable title to the Company Shares  held by it and will
hold such free and clear of all liens, charges and encumbrances whatsoever; and
such Company Shares  held by such Selling Shareholders have been duly
and validly issued and are outstanding as fully paid and non-assessable equity
shares in the capital of Company.  Each of the Selling Shareholders
has due and sufficient right and authority to enter into this Agreement on the
terms and conditions herein set forth and to transfer the registered, legal and
beneficial title and ownership of the Company Shares  held by
it.

     

    
      
        
        

      

      
        -4-

        
          

        

      

      
        
        

      

    

     

    
      	
            	
              3.5

            	Shareholders
      of Company


    

     

    As of the Closing Date, Schedule 1 will
contain a true and complete list of the Selling Shareholders and the number of
Company Shares owned by the Selling Shareholders. There are no other
shareholders, warrant holders or option holders of Company. There is no person
or entity entitled to receive any equity securities, warrants, options or other
instruments that may be converted into equity securities of Company and that
there are no outstanding options, warrants or other securities as of the date
hereof and as of the Closing Date.

     

    Each of the Selling Shareholders is
either an accredited or sophisticated investor.  Each of the Selling
Shareholders has received satisfactory answers to any questions submitted to
Catalyst.  Each of the Selling Shareholders has reviewed the Catalyst
filings as submitted to the United States Securities and Exchange
Commission.  Each Selling Shareholder has had the opportunity to have
this Agreement reviewed by legal counsel.

     

    
      	
            	
              
                3.6

              

            	Corporate
      Records of Company


    

     

    The corporate records of Company, as
required to be maintained by it pursuant to all applicable laws, are accurate,
complete and current in all material respects, and the minute book of Company
is, in all material respects, correct and contains all records required by all
applicable laws, as applicable, in regards to all proceedings, consents, actions
and meetings of the shareholders and the board of directors of
Company.

     

    
      	
            	3.7	
              Non-Contravention

            


    

     

    Neither the execution, delivery and
performance of this Agreement, nor the consummation of the Transaction,
will:

     

    
      	
              (a)  

            	
              conflict
      with, result in a violation of, cause a default under (with or without
      notice, lapse of time or both) or give rise to a right of termination,
      amendment, cancellation or acceleration of any obligation contained in or
      the loss of any material benefit under, or result in the creation of any
      lien, security interest, charge or encumbrance upon any of the material
      properties or assets of Company or any of its subsidiaries under any term,
      condition or provision of any loan or credit agreement, note, debenture,
      bond, mortgage, indenture, lease or other agreement, instrument, permit,
      license, judgment, order, decree, statute, law, ordinance, rule or
      regulation applicable to Company or any of its subsidiaries, or any of
      their respective material property or
assets;

            


    

     

    
      	
              (b)  

            	
              violate
      any provision of the Constitution, Articles of Incorporation or bylaws of
      Company, any of its subsidiaries (if applicable) or any applicable laws;
      or

            


    

     

    
      	
              (c)  
      

            	
              violate
      any order, writ, injunction, decree, statute, rule, or regulation of any
      court or governmental or regulatory authority applicable to Company, any
      of its subsidiaries or any of their respective material property or
      assets.

            


    

     

    
      	
              (d)  
      

            	
              Until
      the Closing Date no officer, director, affiliate or principal shareholder
      of  the  Company will solicit or entertain offers for
      the possible sale, acquisition, merger or similar transaction in
      connection with the operations of the Company’s  business or
      assets.

            


    

     

    
      
        
        

      

      
        -5-

        
          

        

      

      
        
        

      

    

     

    
      	 	
              3.8

            	
              Actions
      and Proceedings

            


    

     

    There is
no basis for and there is no action, suit, judgment, claim, demand or proceeding
outstanding or pending, or threatened against or affecting Company, any
prexisting entity or which involves any of the business, or the properties or
assets of the Company.

     

    
      	
                             
      3.9

            	
              Compliance

            


    

     

    
      	
              (a)  
      

            	
              The  Company
      is in compliance with, is not in default or violation in any material
      respect under, and has not been charged with or received any notice at any
      time of any material violation of any statute, law, ordinance, regulation,
      rule, decree or other applicable regulation to the business or operations
      of Company;

            


    

     

    
      	
              (b)  
      

            	
              The
      Company is not subject to any judgment, order or decree entered in any
      lawsuit or proceeding applicable to its business and operations that would
      constitute a Company Material Adverse Effect;
  and

            


    

     

    
      	
              (c)  
      

            	
              Company
      has duly filed all reports and returns required to be filed by it with
      governmental authorities and has obtained all governmental permits and
      other governmental consents, except as may be required after the execution
      of this Agreement.  All of such permits and consents are in full
      force and effect, and no proceedings for the suspension or cancellation of
      any of them, and no investigation relating to any of them, is pending or
      to the best knowledge of Company, threatened, and none of them will be
      adversely affected by the consummation of the Transaction;
    and

            


    

     

    
      	
              (c)  
      

            	
              Company
      has operated in compliance with all laws, rules, statutes, ordinances,
      orders and regulations applicable to its business.  Company has
      not received any notice of any violation thereof, nor is Company aware of
      any valid basis therefore.

            


    

     

    
      	
                             
      3.10

            	
              Filings,
      Consents and Approvals

            


    

     

    No filing or registration with, no
notice to and no permit, authorization, consent, or approval of any public or
governmental body or authority or other person or entity is necessary for the
consummation by Company  or the Selling Shareholders of the
Transaction contemplated by this Agreement or to enable Catalyst to continue to
conduct Company’s business after the Closing Date in a manner which is
consistent with that in which the business is presently conducted.

     

    
      	
                             
      3.11

            	
              Financial
      Representations

            


    

     

    The consolidated audited balance sheets
for Company (and/or any predecessor entity) for its last two fiscal (the “Company Accounting Date”),
together with related statements of income, cash flows, and changes in
shareholder’s equity for such fiscal years and interim period then ended
(collectively, the “Company
Financial Statements”) to be supplied on or before the Closing Date will
be:

     

    
      
        
        

      

      
        -6-

        
          

        

      

      
        
        

      

    

     

    (A)           in
accordance with the books and records of Company;

     

    
      	
               
      

            	
              (B)

            	
              present
      fairly the financial condition of Company as of the respective dates
      indicated and the results of operations for such periods;
    and

            


    

     

    
      	
               
      

            	
              (C)

            	
              will
      have been prepared in accordance with
  U.S.  GAAP.

            


    

     

    The Company  has not received
any advice or notification from its independent certified public accountants
that Company has used any improper accounting practice that would have the
effect of not reflecting or incorrectly reflecting in the Company Financial
Statements or the books and records of Company, any properties, assets,
Liabilities, revenues, or expenses.  The books, records, and accounts
of Company accurately and fairly reflect, in reasonable detail, the assets, and
Liabilities of Company.  Company has not engaged in any transaction,
maintained any bank account, or used any funds of Company, except for
transactions, bank accounts, and funds which have been and are reflected in the
normally maintained books and records of Company.

     

    
      	 	
              3.12

            	
              Absence
      of Undisclosed Liabilities

            


    

     

               At
Closing the Company will not  have any material Liabilities or
obligations either direct or indirect, matured or unmatured, absolute,
contingent or otherwise that exceed $1,000, which:

     

    (b)    
did not arise in the regular and ordinary course of business under any
agreement, contract,  commitment, lease or plan specifically disclosed
in writing to Catalyst; or

     

    (c)     have
not been incurred in amounts and pursuant to practices consistent with past
business practice, in or as a result of the regular and ordinary course of its
business since the date of the last Company Financial Statements

     

    
      	
               

            	3.13	
              Tax
      Matters

            


    

     

    
      	
               
      

            	
              (a)

            	
              As
      of the date hereof:

            


    

     

    
      	
              (i)  

            	
              Company
      has timely filed all tax returns in connection with any Taxes which are
      required to be filed on or prior to the date hereof, taking into account
      any extensions of the filing deadlines which have been validly granted to
      Company, and

            


    

     

    
      	
              (ii)  

            	
              all
      such returns are true and correct in all material
  respects;

            


    

     

    
      	
              (b)        
       

            	
              Company
      has paid,  all taxes that have become or are due with respect to
      any period ended on or prior to the date hereof, and has established an
      adequate reserve therefore on its balance sheets for those Taxes not yet
      due and payable, except for any Taxes the non-payment of which will not
      have a Company Material Adverse
Effect;

            


    

     

    
      
        
        

      

      
        -7-

        
          

        

      

      
        
        

      

    

     

    
      	
               
      (c)          

            	
              Company
      is not presently under or has not received notice of, any contemplated
      investigation or audit by regulatory or governmental agency of body or any
      foreign or state taxing authority concerning any fiscal year or period
      ended prior to the date hereof;

            


    

     

    
      	
              (d)       
        

            	
              all
      Taxes required to be withheld on or prior to the date hereof from
      employees for income Taxes, social security Taxes, unemployment Taxes and
      other similar withholding Taxes have been properly withheld and, if
      required on or prior to the date hereof, have been deposited with the
      appropriate governmental agency;
and

            


    

     

    
      	
              (e)       
        

            	
              to
      the best knowledge of Company, the Company Financial Statements contain
      full provision for all Taxes including any deferred Taxes that may be
      assessed to Company for the accounting period ended on the Company
      Accounting Date or for any prior period in respect of any transaction,
      event or omission occurring, or any profit earned, on or prior to the
      Company Accounting Date or for any profit earned by Company on or prior to
      the Company Accounting Date or for which Company is accountable up to such
      date and all contingent Liabilities for Taxes have been provided for or
      disclosed in the Company Financial
Statements.

            


    

     

    
      	 	
              3.14

            	
              Absence
      of Changes

            


    

     

    Since the
Company Accounting Date, Company has not:

    
    

     

    
      	 	(a) 	incurred
      any Liabilities, other than Liabilities incurred in the ordinary course of
      business consistent with past practice, or discharged or satisfied any
      lien or encumbrance, or paid any Liabilities, other than in the ordinary
      course of business consistent with past practice, or failed to pay or
      discharge when due any Liabilities of which the failure to pay or
      discharge has caused or will cause any material damage or risk of material
      loss to it or any of its assets or properties;
	 	 	 
	 	(b)   	sold,
      encumbered, assigned or transferred any material fixed assets or
      properties except for ordinary course business transactions consistent
      with past practice;
	 	 	 
	 	(c) 	created,
      incurred, assumed or guaranteed any indebtedness for money borrowed, or
      mortgaged, pledged or subjected any of the material assets or properties
      of Company or its subsidiaries to any mortgage, lien, pledge, security
      interest, conditional sales contract or other encumbrance of any nature
      whatsoever;


    

     

    
      	
              (d)    
             

            	
              made
      or suffered any amendment or termination of any material agreement,
      contract, commitment, lease or plan to which it is a party or by which it
      is bound, or cancelled, modified or waived any substantial debts or claims
      held by it or waived any rights of substantial value, other than in the
      ordinary course of business;

            


    

     

    
      	
              (e)   
              

            	
              declared,
      set aside or paid any dividend or made or agreed to make any other
      distribution or payment in respect of its capital shares or redeemed,
      purchased or otherwise acquired or agreed to redeem, purchase or acquire
      any of its capital shares or equity
securities;

            


    

     

    
      	
                 (f)     
             

            	
              suffered
      any damage, destruction or loss, whether or not covered by insurance, that
      materially and adversely effects its business, operations, assets,
      properties or prospects;

            


    

     

    
      
        
        

      

      
        -8-

        
          

        

      

      
        
        

      

    

     

    
      	
              (g)           
      

            	
              suffered
      any material adverse change in its business, operations, assets,
      properties, prospects or condition (financial or
    otherwise);

            


    

     

    
      	
              (h)           

            	
              received
      notice or had knowledge of any actual or threatened labor trouble,
      termination, resignation, strike or other occurrence, event or condition
      of any similar character which has had or might have an adverse effect on
      its business, operations, assets, properties or
  prospects;

            


    

     

    
      	
              (i)            
      

            	
              made
      commitments or agreements for capital expenditures or capital additions or
      betterments exceeding in the aggregate $500;

            


    

     

    
      	
              (j)            
      

            	
              other
      than in the ordinary course of business, increased the salaries or other
      compensation of, or made any advance (excluding advances for ordinary and
      necessary business expenses) or loan to, any of its employees or directors
      or made any increase in, or any addition to, other benefits to which any
      of its employees or directors may be
entitled;

            


    

     

    
      	
               
      (k)           
      

            	
              entered
      into any transaction other than in the ordinary course of business
      consistent with past practice; or

            


    

     

    
      	
               (l)            

            	
              agreed,
      whether in writing or orally, to do any of the
  foregoing.

            


    

     

    
      	
            	3.15	
              Absence
      of Certain Changes or Events

            


    

     

    Since the
date of the financial statements or audited financial
statements,  there  will not have been:

     

    (a)           any
material change in the financial condition of
Company;  or

     

    
      	
               
      

            	
              (b)

            	
              any
      material change by Company in its accounting methods, principles or
      practices.

            


    

     

    
      	
               

            	3.16	
              Personal
      and Property

            


    

     

    All assets owned or controlled by the
Selling Shareholder in connection with or related to the operation
of  Real Estate Promotions,  a sole proprietorship operated
by the Selling Shareholder (the “Sole Proprietorship”) have been transferred to
Real Estate Promotional Services, Inc.   The Selling Shareholder
on the request of Catalyst,  shall at any time following the Closing
Date and without the payment of additional consideration execute any and all
documents required to transfer any assets previously owned by the Selling
Shareholder in connection with the operations of  the Sole
Proprietorship.

     

    The
Company possesses, and has good and marketable title of all property necessary
for the continued operation of the business of Company as presently conducted
and as represented to Catalyst.  All such property is used in the
business of Company.  All such property is in reasonably good
operating condition (normal wear and tear excepted), and is reasonably fit for
the purposes for which such property is presently used.  All material
equipment, furniture, fixtures and other tangible personal property and assets
owned or leased by Company is owned by Company free and clear of all liens,
security interests, charges, encumbrances, and other adverse claims, except as
set forth herein:

    


    
      
        
        

      

      
        -9-

        
          

        

      

      
        
        

      

    

     

    There are no outstanding agreements or
options to acquire or purchase the Company project, or any interest in or any
portion thereof and no person, firm or corporation has any proprietary or
possessory or royalty interest in Company other than Company

     

    All assets are owned free and clear of
all Liens, defects in title and third party interests other.

     

    
      	 	3.18	Intellectual
      Property


    

     

    
      	
               
      

            	
              (a)

            	
              Intellectual
      Property Assets

            


    

     

    Company
owns or holds an interest in all intellectual property assets necessary for the
operation of the business of Company as it is currently conducted (collectively,
the “Intellectual Property
Assets”), including:

     

    
      	
              (1)  

            	
              all
      functional business names, trading names, registered and unregistered
      trademarks, service marks, and applications (collectively, the “Marks”);

            


    

     

    
      	
              (2)  

            	
              all
      patents, patent applications, and inventions, methods, processes and
      discoveries that may be patentable (collectively, the “Patents”);

            


    

     

    
      	
              (3)  

            	
              all
      copyrights in both published works and unpublished works (collectively,
      the “Copyrights”);
      and

            


    

     

    
      	
              (4)  

            	
              all
      know-how, trade secrets, confidential information, customer lists,
      software, technical information, data, process technology, plans,
      drawings, and blue prints owned, used, or licensed by Company as licensee
      or licensor (collectively, the “Trade
      Secrets”).

            


    

     

    
      	
              (b)  

            	
                    Intellectual
      Property and Know-How Necessary for the
Business

            


    

     

    Company
is the owner of all right, title, and interest in and to each of the
Intellectual Property Assets, free and clear of all liens, security interests,
charges, encumbrances, and other adverse claims, and has the right to use
without payment to a third party of all the Intellectual Property
Assets.  All former and current employees and contractors of Company
have executed written contracts, agreements or other undertakings with Company
that assign all rights to any inventions, improvements, discoveries, or
information relating to the business of Company.  No employee,
director, officer or shareholder of Company owns directly or indirectly in whole
or in part, any Intellectual Property Asset which Company is presently using or
which is necessary for the conduct of its business.  To the best
knowledge of Company, no employee or contractor of Company has entered into any
contract or agreement that restricts or limits in any way the scope or type of
work in which the employee may be engaged or requires the employee to transfer,
assign, or disclose information concerning his work to anyone other than
Company.

     

    
      
        
        

      

      
        -10-

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              Patents

            


    

     

    Company
does not hold any right, title or interest in and to any Patent and Company has
not filed any patent application with any third party.  To the best
knowledge of Company, none of the products manufactured and sold, nor any
process or know-how used, by Company infringes or is alleged to infringe any
patent or other proprietary night of any other person or entity.

     

    
      	
               
      

            	
              Trademarks

            


    

     

    Company
does not hold any right, title or interest in and to any Mark and Company has
not registered or filed any application to register any Mark with any third
party.  To the best knowledge of Company, none of the Marks, if any,
used by Company infringes or is alleged to infringe any trade name, trademark,
or service mark of any third party.

     

    
      	
               
      

            	
              Copyrights

            


    

     

    If
applicable, all registered Copyrights are currently in compliance with formal
legal requirements, are valid and enforceable, and are not subject to any
maintenance fees or taxes or actions falling due within ninety days after the
Closing Date.  To the best knowledge of Company, no Copyright is
infringed or has been challenged or threatened in any way and none of the
subject matter of any of the Copyrights infringes or is alleged to infringe any
copyright of any third party or is a derivative work based on the work of a
third party.  All works encompassed by the Copyrights have been marked
with the proper copyright notice.

     

    
      	
               
      

            	
              Trade
      Secrets

            


    

     

    Company
has taken all reasonable precautions to protect the secrecy, confidentiality,
and value of its Trade Secrets.  Company has good title and an
absolute right to use the Trade Secrets.  The Trade Secrets are not
part of the public knowledge or literature, and to the best knowledge of
Company, have not been used, divulged, or appropriated either for the benefit of
any person or entity or to the detriment of Company.  No Trade Secret
is subject to any adverse claim or has been challenged or threatened in any
way.

     

    
      	
            	
              
                3.19

              

            	Insurance


    

     

    The assets owned by Company are insured
under various policies of general product liability and other forms of insurance
consistent with prudent business practices.  All such policies are in
full force and effect in accordance with their terms, no notice of cancellation
has been received, and there is no existing default by Company, or any event
which, with the giving of notice, the lapse of time or both, would constitute a
default thereunder.  All premiums to date have been paid in
full.

     

    
      	 	
              3.20

            	
              Employees
      and Consultants

            


    

     

    All employees and consultants of
Company have been paid all salaries, wages, income and any other sum due and
owing to them by Company, as at the end of the most recent completed pay
period.  Company is not aware of any labor conflict with any employees
that might reasonably be expected to have a Company Material Adverse
Effect.  To the best knowledge of Company, no employee of Company is
in violation of any term of any employment contract, non-disclosure agreement,
non-competition agreement or any other contract or agreement relating to the
relationship of such employee with Company or any other nature of the business
conducted or to be conducted by Company.

     

    At the Closing,  the Company
shall not be required to retain any current employees and all outstanding
employment obligations or any agreements with consultants may be terminated at
closing.

     

    
      
        
        

      

      
        -11-

        
          

        

      

      
        
        

      

    

     

    
      	 	
              3.20

            	
              Real
      Property

            


    

     

    Company does not own any real
property.  Each of the leases, subleases, claims or other real
property interests (collectively, the “Leases”) to which Company is a
party or is bound is legal, valid, binding, enforceable and in full force and
effect in all material respects.  All rental and other payments
required to be paid by Company pursuant to any such Leases have been duly paid
and no event has occurred which, upon the passing of time, the giving of notice,
or both, would constitute a breach or default by any party under any of the
Leases.  The Leases will continue to be legal, valid, binding,
enforceable and in full force and effect on identical terms following the
Closing Date.  Company has not assigned, transferred, conveyed,
mortgaged, deeded in trust, or encumbered any interest in the Leases or the
leasehold property pursuant thereto.

     

    
      	 	
              3.21

            	
              Material
      Contracts and Transactions

            


    

     

    Each Contract to which the Company is
bound  is in full force and effect, and there exists no material
breach or violation of or default by Company under any Contract, or any event
that with notice or the lapse of time, or both, will create a material breach or
violation thereof or default under any Contract by Company.  The
continuation, validity, and effectiveness of each Contract will in no way be
affected by the consummation of the Transaction contemplated by this
Agreement.  There exists no actual or threatened termination,
cancellation, or limitation of, or any amendment, modification, or change to any
Contract.

     

    
      	 	
              3.22

            	
              Certain
      Transactions

            


    

     

    Company is not a guarantor or
indemnitor of any indebtedness of any third party, including any person, firm or
corporation.

     

    
      	 	
              3.23

            	
              Completeness
      of Disclosure

            


    

     

    No
representation or warranty by Company or any Selling Shareholder in this
Agreement nor any certificate, schedule, statement, document or instrument
furnished or to be furnished to Catalyst pursuant hereto contains or will
contain any untrue statement of a material fact or omits or will omit to state a
material fact required to be stated herein or therein or necessary to make any
statement herein or therein not materially misleading.

     

    3.24         Resale
Restrictions and Investment Intent.

     

    The
Selling Shareholders acknowledge and agree that the Convertible Debenture to be
issued by Catalyst and any Catalyst Shares to be issued on the conversion of the
Convertible Debenture are being issued for investment purposes only pursuant to
an exemption from the prospectus and registration requirements of the Securities
Act.  As required by applicable securities law, the Selling
Shareholders agree to abide by all applicable resale restrictions and hold
periods imposed by all applicable securities legislation.  All
certificates representing the Catalyst Convertible Debenture or the shares of
Common Stock to be issued upon the conversion of the Convertible Debenture will
be endorsed with a restrictive legend similar in form and substance to the
following:

     

    
      
        
        

      

      
        -12-

        
          

        

      

      
        
        

      

    

     

    “NONE OF
THE SECURITIES REPRESENTED HEREBY HAVE BEEN REGISTERED UNDER THE UNITED STATES
SECURITIES ACT OF 1933, AS AMENDED (THE “1933 ACT”), OR ANY U.S. STATE
SECURITIES LAWS, AND, UNLESS SO REGISTERED, MAY NOT BE OFFERED OR SOLD, DIRECTLY
OR INDIRECTLY, IN THE UNITED STATES (AS DEFINED HEREIN) OR TO U.S. PERSONS
EXCEPT IN ACCORDANCE WITH THE PROVISIONS OF REGULATION S UNDER THE 1933 ACT,
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE 1933 ACT, OR PURSUANT
TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF THE 1933 ACT AND IN EACH CASE ONLY IN ACCORDANCE
WITH APPLICABLE STATE SECURITIES LAWS.  IN ADDITION, HEDGING
TRANSACTIONS INVOLVING THE SECURITIES MAY NOT BE CONDUCTED UNLESS IN COMPLIANCE
WITH THE 1933 ACT.  “UNITED STATES” AND “U.S. PERSON” ARE AS DEFINED
BY REGULATION S UNDER THE 1933 ACT.”

     

    
      	
              4.

            	
              REPRESENTATIONS
      AND WARRANTIES OF CATALYST

            


    

     

    
      	
               
      

            	
              As
      of the Closing, Catalyst represent and warrant to Company and the Selling
      Shareholders and acknowledge that Company and the Selling Shareholders are
      relying upon such representations and warranties in connection with the
      execution, delivery and performance of this Agreement, notwithstanding any
      investigation made by or on behalf of Company or the Selling Shareholders,
      as follows:

            


    

     

    
      	
            	4.1	
              Organization
      and Good Standing

            


    

     

    Catalyst is a
corporation  duly incorporated, organized, validly existing and in
good standing under the laws of the state of
Delaware.  Catalyst  has all requisite
corporate   authority to own, lease and to carry on its business
as now being conducted.

     

    
      	
            	
              
                4.2

              

            	Authority


    

     

    Catalyst  has  all
requisite corporate Company and authority to execute and deliver this Agreement
and any other document contemplated by this Agreement (collectively, the “Catalyst Documents”) to be
signed by each and to perform its obligations hereunder and to consummate the
transactions contemplated hereby.  The execution and delivery of the
Catalyst Documents by each  and the consummation by each of the
transactions contemplated hereby have been duly authorized
by   board of directors and no other corporate or shareholder
proceedings on the part of either corporation  is necessary to
authorize such documents or to consummate the transactions contemplated
hereby.  This Agreement has been, and the other Catalyst Documents
when executed and delivered by Catalyst  as contemplated by this
Agreement will be, duly executed and delivered by Catalyst and this Agreement
is, and the other Catalyst Documents when executed and delivered by
Catalyst,  as contemplated hereby will be, valid and binding
obligations of Catalyst enforceable in accordance with their respective terms,
except:

     

    
      
        
        

      

      
        -13-

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              (a)

            	
              as
      limited by applicable bankruptcy, insolvency, reorganization, moratorium,
      and  other laws of general application affecting enforcement of
      creditors’ rights generally;

            


    

     

    
      	
               
      

            	
              (b)

            	
              as
      limited by laws relating to the availability of specific performance,
      injunctive relief, or other equitable remedies;
  and

            


    

     

    
      	
               
      

            	
              (c)

            	
              as
      limited by public policy.

            


    

     

    
      	 	
              4.3

            	
              Capitalization
      of Catalyst

            


    

     

    As of the date of this Agreement and as
of the Closing Date, all of the issued and outstanding shares of
Catalyst  will be duly authorized, are validly issued, were not issued
in violation of any pre-emptive rights and are fully paid and non-assessable,
are not subject to pre-emptive rights and were issued in full compliance with
all federal, state, and local laws, rules and regulations.

     

    
      	
            	
              
                4.4

              

            	Corporate
      books and records


    

     

    
      	
               
      

            	
              The
      corporate records of Catalyst, as required to be maintained by it pursuant
      to the laws of the State of  Delaware,  are accurate,
      complete and current in all material respects, and the minute book of
      Catalyst is, in all material respects, correct and contains all material
      records required by the law of the State of Delaware in regards to all
      proceedings, consents, actions and meetings of the shareholders and the
      board of directors of Catalyst.

            


    

     

    
      	
            	4.5	
              Non-Contravention

            


    

     

    Neither
the execution, delivery and performance of this Agreement, nor the consummation
of the Transaction, will:

     

    (A) 
conflict with, result in a violation of, cause a default under (with or without
notice, lapse of time or   both) or give rise to a right of
termination, amendment, cancellation or acceleration of any obligation contained
in or the loss of any material benefit under, or result in the creation of any
lien, security interest, charge or encumbrance upon any of the material
properties or assets of Catalyst under any term, condition or provision of any
loan or credit agreement, note, debenture, bond, mortgage, indenture, lease or
other agreement, instrument, permit, license, judgment, order, decree, statute,
law, ordinance, rule or regulation applicable to Catalyst or any of its material
property or assets;

     

    
    

    
      (B)
violate any provision of the applicable incorporation or charter documents of
Catalyst; or

       

    

    (C) 
violate any order, writ, injunction, decree, statute, rule, or regulation of any
court or governmental or regulatory authority applicable to Catalyst or any of
its material property or assets.

     

    
      	
            	4.6	
              Actions
      and Proceedings

            


    

     

    To the
best knowledge of Catalyst, there is no claim, charge, arbitration, grievance,
action, suit, investigation or proceeding by or before any court, arbiter,
administrative agency or other governmental authority now pending or, to the
best knowledge of Catalyst, threatened against Catalyst which involves any of
the business, or the properties or assets of Catalyst that, if adversely
resolved or determined, would have a material adverse effect on the business,
operations, assets, properties, prospects or conditions of Catalyst taken as a
whole (a “Catalyst Material
Adverse Effect”).  There is no reasonable basis for any claim
or action that, based upon the likelihood of its being asserted and its success
if asserted, would have such a Catalyst Material Adverse Effect.

     

    
      
        
        

      

      
        -14-

        
          

        

      

      
        
        

      

    

     

    
      	
            	
              
                4.7

              

            	Compliance


    

     

    
      	
               
      

            	
              (A)

            	
              To
      the best knowledge of Catalyst, Catalyst is in compliance with, is not in
      default or violation in any material respect under, and has not been
      charged with or received any notice at any time of any material violation
      of any statute, law, ordinance, regulation, rule, decree or other
      applicable regulation to the business or operations of
      Catalyst;

            


    

     

    
      	
               
      

            	
              (B)

            	
              To
      the best knowledge of Catalyst, Catalyst is not subject to any judgment,
      order or decree entered in any lawsuit or proceeding applicable to its
      business and operations that would constitute a Catalyst Material Adverse
      Effect; and

            


    

     

    


     

    
      	
               
      

            	
              (C)

            	
              Catalyst
      has operated in material compliance with all laws, rules, statutes,
      ordinances, orders and regulations applicable to its
      business.  Catalyst has not received any notice of any violation
      thereof, nor is Catalyst aware of any valid basis
    therefore.

            


    

     

    
      	
            	
              
                4.8

              

            	Filings,
      Consents and Approvals


    

     

    No filing or registration with, no
notice to and no permit, authorization, consent, or approval of any public or
governmental body or authority or other person or entity is necessary for the
consummation by Catalyst of the Transaction contemplated by this Agreement to
continue to conduct its business after the Closing Date in a manner which is
consistent with that in which it is presently conducted.

     

    
      	
            	
              
                4.09

              

            	SEC
      Filings


    

     

    Catalyst has furnished or made
available to Company and the Selling Shareholders a true and complete copy of
each report, schedule, registration statement and proxy statement filed by
Catalyst with the SEC (collectively, and as such documents have since the time
of their filing been amended, the “Catalyst SEC Documents”). As
of their respective dates, the Catalyst SEC Documents complied in all material
respects with the requirements of the Securities Act, or the Exchange Act, as
the case may be, and the rules and regulations of the SEC thereunder applicable
to such Catalyst SEC Documents.  Financial
Representations

     

    Included with the Catalyst SEC
Documents are true, correct, and complete copies of the financial statements of
Catalyst  (the “Catalyst Accounting Date”),
together with related statements of income, cash flows, and changes in
shareholder’s equity for the fiscal year and interim period then ended
(collectively, the “Catalyst
Financial Statements”).  The Catalyst Financial
Statements:

     

    (a) are
in accordance with the books and records of Catalyst;

     

    (b)
present fairly the financial condition of Catalyst as of the respective dates
indicated and the results of operations for such periods; and

     

    (c)  have
been prepared in accordance with GAAP.

     

    Catalyst
has not received any advice or notification from its independent certified
public accountants that Catalyst has used any improper accounting practice that
would have the effect of not reflecting or incorrectly reflecting in the
Catalyst Financial Statements or the books and records of Catalyst, any
properties, assets, Liabilities, revenues, or expenses.  The books,
records, and accounts of Catalyst accurately and fairly reflect, in reasonable
detail, the assets, and Liabilities of Catalyst.  Catalyst has not
engaged in any transaction, maintained any bank account, or used any funds of
Catalyst, except for transactions, bank accounts, and funds which have been and
are reflected in the normally maintained books and records of
Catalyst.

     

    
      
        
        

      

      
        -15-

        
          

        

      

      
        
        

      

    

     

    
      	 	
              4.11

            	
              Absence
      of Undisclosed Liabilities

            


    

     

     As
of the date of the financial statements, Catalyst has no material Liabilities or
obligations either direct or indirect, matured or unmatured, absolute,
contingent or otherwise, which:

     

               (A)
are not set forth in the Catalyst Financial Statements or have not heretofore
been paid or discharged;

     

            
  (B) did not arise in the regular and ordinary course of business
under any agreement, contract, commitment, lease or plan specifically disclosed
in writing to Company;

     

               (C)
have not been incurred in amounts and pursuant to practices consistent with past
business practice, in or as a result of the regular and ordinary course of its
business since the date of the last Catalyst Financial Statements;
or

     

             
 (D) have any material affect on the operations of the
Company.

     

    
      	
            	
              
                4.12

              

            	Tax
      Matters


    

     

    
      	
               
      

            	
              As
      of the date hereof:

            


    

     

             
  (A) Catalyst has timely filed all tax returns in connection with any
Taxes which are required to be filed on or prior to the date hereof, taking into
account any extensions of the filing deadlines which have been validly granted
to them, and

     

            
   (B) All such returns are true and correct in all material
respects;

     

            
   (C) Catalyst has paid all Taxes that have become or are due with
respect to any period ended on or prior to the date hereof;

     

              
 (D) Catalyst is not presently under and has not received notice of, any
contemplated investigation or audit by the Internal Revenue Service or any
foreign or state taxing authority concerning any fiscal year or period ended
prior to the date hereof;

     

             
  (E)  All Taxes required to be withheld on or prior to the
date hereof from employees for income Taxes, social security Taxes, unemployment
Taxes and other similar withholding Taxes have been properly withheld and, if
required on or prior to the date hereof, have been deposited with the
appropriate governmental agency; and

     

              
 (F) To the best knowledge of Catalyst, the Catalyst Financial Statements
contain full provision for all Taxes including any deferred Taxes that may be
assessed to Catalyst for the accounting period ended on the Catalyst Accounting
Date or for any prior period in respect of any transaction, event or omission
occurring, or any profit earned, on or prior to the Catalyst Accounting Date or
for any profit earned by Catalyst on or prior to the Catalyst Accounting Date or
for which Catalyst is accountable up to such date and all contingent Liabilities
for Taxes have been provided for or disclosed in the Catalyst Financial
Statements.

     

    
      
        
        

      

      
        -16-

        
          

        

      

      
        
        

      

    

     

    
      	
            	
              
                4.13

              

            	Personal
      Property


    

     

    There are
no material equipment, furniture, fixtures and other tangible personal property
and assets owned or leased by Catalyst, except as disclosed in the Catalyst SEC
Documents.

     

    
      	5.	
               

            	
              CLOSING
      CONDITIONS

            


    

     

    
      	 	
              5.1

            	
              Conditions
      Precedent to Closing by Catalyst

            


    

     

    The
obligation of Catalyst to consummate the Transaction is subject to the
satisfaction or written waiver of the conditions set forth herein on a date
mutually agreed upon by the parties hereto in writing.  The Closing of
the Transaction contemplated by this Agreement will be deemed to mean a waiver
of all conditions to Closing.  These conditions precedent are for the
benefit of Catalyst and may be waived by Catalyst in its sole
discretion.

     

    (a)   Representations
and Warranties

     

    The
representations and warranties of Company and the Selling Shareholders set forth
in this Agreement will be true, correct and complete in all respects as of the
Closing Date, as though made on and as of the Closing Date and Company will have
delivered to Catalyst a certificate dated as of the Closing Date, to the effect
that the representations and warranties made by Company in this Agreement are
true and correct.

     

    
      	
                             
      (b)

            	
              Performance

            


    

     

    All of
the covenants and obligations that Company and the Selling Shareholders are
required to perform or to comply with pursuant to this Agreement at or prior to
the Closing must have been performed and complied with in all material
respects.

     

    
      	
                             
      (c)

            	
              Transaction
      Documents

            


    

     

    This
Agreement, the Company Documents, the Company Financial Statements and all other
documents necessary or reasonably required to consummate the Transaction, all in
form and substance reasonably satisfactory to Catalyst, will have been executed
and delivered to Catalyst.

     

    
      
        
        

      

      
        -17-

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              (d)  Third
      Party Consents

            


    

     

    Catalyst
will have received from Company duly executed copies of any
required  third-party consents, permits, authorizations and approvals
of any public, regulatory  or governmental body or authority or person
or entity contemplated by this Agreement (if any), in the form and substance
reasonably satisfactory to Catalyst.

     

    
      	
               
      

            	
              (e)  No
      Material Adverse Change

            


    

     

    No
Company Material Adverse Effect will have occurred since the date of this
Agreement.

     

    
      	
               
      

            	
              (f)   No
      Action

            


    

     

    
      	
              (1) 

            	
              No
      suit, action, or proceeding will be pending or threatened which
      would:

            


    

     

    
      	
              (2) 

            	
              prevent
      the consummation of any of the transactions contemplated by this
      Agreement; or

            


    

     

    
      	
                 (3) 

            	
              cause
      the Transaction to be rescinded following
  consummation.

            


    

     

    
      	
               
      

            	
              (g)  Delivery
      of Financial Statements

            


    

     

    Company
will have delivered to Catalyst the Company Financial Statements within the time
frame prescribed by this Agreement, which will include the  audited
financial statements as required by the Securities and Exchange Commission in
connection with the closing of this transaction.  The financial
statements shall be prepared in accordance with GAAP and audited by an
independent auditor registered with the Public Company Accounting Oversight
Board in the United States.

     

    
      	
               
      

            	
              (h)  Due
      Diligence Review of Financial
Statements

            


    

     

    Catalyst
and its accountants will be reasonably satisfied with their due diligence
investigation and review of the Company Financial Statements.

     

    
      	 	
              5.2

            	
              Conditions
      Precedent to Closing by Company

            


    

     

    The
obligation of Company and the Selling Shareholders to consummate the Transaction
is subject to the satisfaction or written waiver of the conditions set forth
below by a date mutually agreed upon by the parties.  The Closing of
the Transaction will be deemed to mean a waiver of all conditions to
Closing.  These conditions precedent are for the benefit of Company
and the Selling Shareholders and may be waived by Company and the Selling
Shareholders in their discretion.

     

    
      
        
        

      

      
        -18-

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              (a)  Representations
      and Warranties

            


    

     

    
      	
               
      

            	
               

            


    

     

    The
representations and warranties of Catalyst set forth in this Agreement will be
true, correct and complete in all respects as of the Closing Date, as though
made on and as of the Closing Date and Catalyst will have delivered to Company a
certificate dated the Closing Date, to the effect that the representations and
warranties made by Catalyst in this Agreement are true and correct.

     

    
      	
               
      

            	
              (b)   Performance

            


    

     

    All of
the covenants and obligations that Catalyst are required to perform or to comply
with pursuant to this Agreement at or prior to the Closing must have been
performed and complied with in all material respects.  Catalyst must
have delivered each of the documents required to be delivered by it pursuant to
this Agreement.

     

    
      	
               
      

            	
              (c)  Transaction
      Documents

            


    

     

    This
Agreement, the Catalyst Documents and all other documents necessary or
reasonably required to consummate the Transaction, all in form and substance
reasonably satisfactory to Company, will have been executed and delivered by
Catalyst.

     

        (d)  No
Material Adverse Change

     

    No
Catalyst Material Adverse Effect will have occurred since the date of this
Agreement.

     

    
      	6.	
               

            	
              ADDITIONAL
      COVENANTS OF THE PARTIES

            


    

     

    
      	 	
              6.1

            	
              Notification
      of Financial Liabilities

            


    

     

    Company
will immediately notify Catalyst  if Company receives any advice or
notification from its independent certified public accounts that Company has
used any improper accounting practice that would have the effect of not
reflecting or incorrectly reflecting in the books, records, and accounts of
Company, any properties, assets, Liabilities, revenues, or expenses.
Notwithstanding any statement to the contrary in this Agreement, this covenant
will survive Closing and continue in full force and effect.

     

    6.2       
  Access and Investigation

     

    Between
the date of this Agreement and the Closing Date, Company, on the one hand, and
Catalyst, on the other hand, will, and will cause each of their respective
representatives to:

     

    
      
        
        

      

      
        -19-

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              (1)
      afford the other and its representatives full and free access to its
      personnel, properties, assets, contracts, books and records, and other
      documents and data;

            


    

     

    
      	
               
      

            	
              (2)
      furnish the other and its representatives with copies of all such
      contracts, books and records, and other existing documents and data as
      required by this Agreement and as the other may otherwise reasonably
      request; and

            


    

     

    
      	
               
      

            	
              (3)
      furnish the other and its representatives with such additional financial,
      operating, and other data and information as the other may reasonably
      request.

            


    

     

    All of
such access, investigation and communication by a party and its representatives
will be conducted during normal business hours and in a manner designed not to
interfere unduly with the normal business operations of the other
party.  Each party will instruct its auditors to co-operate with the
other party and its representatives in connection with such
investigations.

     

    
      	
              6.3          
      

            	
              Confidentiality

            


    

     

    All
information regarding the business of Company including, without limitation,
financial information that Company provides to Catalyst during the Catalyst due
diligence investigation of Company will be kept in strict confidence by Catalyst
and will not be used (except in connection with due diligence), dealt with,
exploited or commercialized by Catalyst or disclosed to any third party (other
than the Catalyst professional accounting and legal advisors) without the prior
written consent of Company.  If the Transaction contemplated by this
Agreement does not proceed for any reason, then upon receipt of a written
request from Company, Catalyst will immediately return to Company (or as
directed by Company) any information received regarding Company’s
business.  Likewise, all information regarding the business of
Catalyst including, without limitation, financial information that Catalyst
provides to Company during its due diligence investigation of Catalyst will be
kept in strict confidence by Company and will not be used (except in connection
with due diligence), dealt with, exploited or commercialized by Company or
disclosed to any third party (other than Company’s professional accounting and
legal advisors) without the prior written consent of Catalyst.  If the
Transaction contemplated by this Agreement does not proceed for any reason, then
upon receipt of a written request from Catalyst, Company will immediately return
to Catalyst (or as directed by Catalyst) any information received regarding
Catalyst’s business.

     

    
      	 	
              6.4

            	
              Notification

            


    

     

    Between
the date of this Agreement and the Closing Date, each of the parties to this
Agreement will promptly notify the other parties in writing if it becomes aware
of any fact or condition that causes or constitutes a material breach of any of
its representations and warranties as of the date of this Agreement, if it
becomes aware of the occurrence after the date of this Agreement of any fact or
condition that would cause or constitute a material breach of any such
representation or warranty had such representation or warranty been made as of
the time of occurrence or discovery of such fact or condition.  Should
any such fact or condition require any change in the Schedules relating to such
party, such party will promptly deliver to the other parties a supplement to the
Schedules specifying such change.  During the same period, each party
will promptly notify the other parties of the occurrence of any material breach
of any of its covenants in this Agreement or of the occurrence of any event that
may make the satisfaction of such conditions impossible or
unlikely.

     

    
      
        
        

      

      
        -20-

        
          

        

      

      
        
        

      

    

     

    
      	
              6.5          
      

            	
              Exclusivity

            


    

     

    Until
such time, if any, as this Agreement is terminated pursuant to this Agreement,
Company and Catalyst will not, directly or indirectly, solicit, initiate,
entertain or accept any inquiries or proposals from, discuss or negotiate with,
provide any non-public information to, or consider the merits of any unsolicited
inquiries or proposals from, any person or entity relating to any transaction
involving the sale of the business or assets (other than in the ordinary course
of business), or any of the capital stock of Company or Catalyst, as applicable,
or any merger, consolidation, business combination, or similar transaction other
than as contemplated by this Agreement.

     

    
      	
              6.6          
      

            	
              Conduct
      of Company and Catalyst Business Prior to
  Closing

            


    

     

    From the
date of this Agreement to the Closing Date, and except to the extent that
Catalyst otherwise consents in writing, Company will operate its business
substantially as presently operated and only in the ordinary course and in
compliance with all applicable laws, and use its best efforts to preserve intact
its good reputation and present business organization and to preserve its
relationships with persons having business dealings with
it.  Likewise, from the date of this Agreement to the Closing Date,
and except to the extent that Company otherwise consents in writing, Catalyst
will operate its business substantially as presently operated and only in the
ordinary course and in compliance with all applicable laws, and use its best
efforts to preserve intact its good reputation and present business organization
and to preserve its relationships with persons having business dealings with
it.

     

    Notwithstanding
anything else contained herein to the contrary,  in the event that the
transaction does not close,  neither the Company nor
Catalyst  nor any officer or director of each,  shall be
liable to the other for any action taken prior to Closing.

     

    
      	
              6.7          
      

            	
              Certain
      Acts Prohibited – Company

            


    

     

    Except as
expressly contemplated by this Agreement or for purposes in furtherance of this
Agreement, between the date of this Agreement and the Closing Date, Company will
not, without the prior written consent of Catalyst:

     

    
      	
              (1)  

            	
              amend
      its Articles of  Incorporation or other incorporation
      documents;

            


    

     

    
      	
              (2)  

            	
              incur
      any liability or obligation other than in the ordinary course of business
      or encumber or permit the encumbrance of any properties or assets of
      Company except in the ordinary course of
  business;

            


    

     

    
      	
              (3)  

            	
              dispose
      of or contract to dispose of any Company property or assets, including the
      Intellectual Property Assets, except in the ordinary course of business
      consistent with past practice;

            


    

     

    
      	
              (4)  

            	
              issue,
      deliver, sell, pledge or otherwise encumber or subject to any lien any
      shares of the Company Common Stock, or any rights, warrants or options to
      acquire, any such shares, voting securities or convertible
      securities;

            


    

     

    
      	
              (5)  

            	
              declare,
      set aside or pay any dividends on, or make any other distributions in
      respect of the Company Common Stock,
or

            


    

     

    
      
        
        

      

      
        -21-

        
          

        

      

      
        
        

      

    

     

    
      	
              (6)  

            	
              split,
      combine or reclassify any Company Common Stock or issue or authorize the
      issuance of any other securities in respect of, in lieu of or in
      substitution for shares of Company Common Stock;
  or

            


    

     

    
      	
              (7)  

            	
              not
      materially increase benefits or compensation expenses of Company, other
      than as contemplated by the terms of any employment agreement in existence
      on the date of this Agreement, increase the cash compensation of any
      director, executive officer or other key employee or pay any benefit or
      amount not required by a plan or arrangement as in effect on the date of
      this Agreement to any such person.

            


    

     

    
      	
              6.8          
      

            	
              Certain
      Acts Prohibited – Catalyst

            


    

     

    Except as
expressly contemplated by this Agreement, between the date of this Agreement and
the Closing Date, Catalyst will not, without the prior written consent of
Company:

     

    
      	
              (1)  

            	
              dispose
      of or contract to dispose of any Catalyst property or assets except in the
      ordinary course of business consistent with past
  practice;

            


    

     

    
      	
              (2)  

            	
              declare,
      set aside or pay any dividends on, or make any other distributions in
      respect of the Catalyst Common Stock;
or

            


    

     

    
      	
              (3)  

            	
              materially
      increase benefits or compensation expenses of Catalyst, increase the cash
      compensation of any director, executive officer or other key employee or
      pay any benefit or amount to any such
person.

            


    

     

    
      	
              6.9          
      

            	
              Public
      Announcements

            


    

     

    Catalyst
and Company each agree that they will not release or issue any reports or
statements or make any public announcements relating to this Agreement or the
Transaction contemplated herein without the prior written consent of the other
party, except as may be required by the disclosure obligation imposed on
Catalyst or Company or their respective affiliates under rules or regulations of
any stock exchange or laws of any jurisdiction.

     

    
      	
              7.

            	
              CLOSING

            


    

    
    

     

    
      	 	7.1	The Closing shall
      take place on the Closing Date at the offices of Catalyst  or at
      such other location as agreed to by the
parties.


    

     

    
      	
              7.2           
      

            	
              Closing Deliveries of Company
      and the Selling Shareholders

            


    

    
    

     

    
      	     
      (1)       	At Closing, Company
      and the Selling Shareholders will deliver or cause to be delivered the
      following, fully executed and in the form and substance reasonably
      satisfactory to Catalyst:


    

           

    
      	
               
      

            	
              (2)

            	
              copies
      of all resolutions and/or consent actions adopted by or on behalf of the
      board of directors of Company evidencing approval of this Agreement and
      the Transaction;

            


    

     

    
      	
               
      

            	
              (3)

            	
              if
      any of the Selling Shareholders appoint any person, by Company of attorney
      or equivalent, to execute this Agreement or any other agreement, document,
      instrument or certificate contemplated by this agreement, on behalf of the
      Selling Shareholder, a valid and binding Company of attorney or equivalent
      from such Selling Shareholder;

            


    

     

    
      
        
        

      

      
        -22-

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              (4)

            	
              share
      certificates representing the Company Shares  if such have been
      issued;

            


    

     

    
      	
               
      

            	
              (5)

            	
              certificates
      and other documents required by  this Agreement;
    and

            


    

     

    
      	
               
      

            	(6)	
              the
      Company Documents, the Company Financial Statements and any other
      necessary documents, each duly executed by Company, as required to give
      effect to the Transaction.

            


    

     

    
      	
              7.3           
      

            	
              Closing
      Deliveries of Catalyst

            


    

     

    At
Closing, Catalyst will deliver or cause to be delivered the following, fully
executed and in the form and substance reasonably satisfactory to
Company:

     

    
      	
              (1)          

            	
              copies
      of all resolutions and/or consent actions adopted by or on behalf of the
      board of directors of Catalyst evidencing approval of this Agreement and
      the Transaction;

            


    

     

    
      	
              (2)       
        

            	
               the
      Convertible Debenture

            


    

     

    
      	
              8.

            	
              TERMINATION

            


    

     

    
      	
              8.1          
      

            	
              Termination

            


    

     

    This
Agreement may be terminated at any time prior to the Closing Date contemplated
hereby by:

     

            (A)   mutual
agreement of Catalyst and Company;

     

            (B)
Catalyst, if there has been a material breach by Company or any of the Selling
Shareholders of any material representation, warranty, covenant or agreement set
forth in this Agreement on the part of Company or the Selling Shareholders that
is not cured, to the reasonable satisfaction of Catalyst, within ten business
days after notice of such breach is given by Catalyst (except that no cure
period will be provided for a breach by Company or the Selling Shareholders that
by its nature cannot be cured);

     

           (C)
Company, if there has been a material breach by Catalyst of any material
representation, warranty, covenant or agreement set forth in this Agreement on
the part of Catalyst that is not cured by the breaching party, to the reasonable
satisfaction of Company, within ten business days after notice of such breach is
given by Company (except that no cure period will be provided for a breach by
Catalyst that by its nature cannot be cured); or

     

           (D)
Catalyst or Company if any permanent injunction or other order of a governmental
entity of competent authority preventing the consummation of the Transaction
contemplated by this Agreement has become final and non-appealable.

     

    
      
        
        

      

      
        -23-

        
          

        

      

      
        
        

      

    

     

    
      	
              8.2          
      

            	
              Effect
      of Termination

            


    

     

    In the
event of the termination of this Agreement,  , this Agreement will be
of no further force or effect, provided, however, that no termination of this
Agreement will relieve any party of liability for any breaches of this Agreement
that are based on a wrongful refusal or failure to perform any
obligations.

     

    
      	
              9.

            	
              INDEMNIFICATION,
      REMEDIES, SURVIVAL

            


    

     

    
      	
              9.1          
      

            	
              Certain
      Definitions

            


    

     

    For the
purposes of this Article 9 the terms
“Loss” and “Losses” mean any and all
demands, claims, actions or causes of action, assessments, losses, damages,
Liabilities, costs, and expenses, including without limitation, interest,
penalties, fines and reasonable attorneys, accountants and other professional
fees and expenses, but excluding any indirect, consequential or punitive damages
suffered by Catalyst or Company including damages for lost profits or lost
business opportunities.

     

    
      	
              9.2          
      

            	
              Agreement
      of Company to Indemnify

            


    

     

    Company
will indemnify, defend, and hold harmless, to the full extent of the law,
Catalyst and its shareholders from, against, and in respect of any and all
Losses asserted against, relating to, imposed upon, or incurred by Catalyst and
its shareholders by reason of, resulting from, based upon or arising out
of:

     

    
      	
               
      

            	
              (A)

            	
              the
      breach by Company of any representation or warranty of Company contained
      in or made pursuant to this Agreement, any Company Document or any
      certificate or other instrument delivered pursuant to this Agreement;
      or

            


    

     

    
      	
               
      

            	
              (B)

            	
              the
      breach or partial breach by Company of any covenant or agreement of
      Company made in or pursuant to this Agreement, any Company Document or any
      certificate or other instrument delivered pursuant to this
      Agreement.

            


    

     

    
      	
            	
              
                9.3

              

            	Agreement
      of the Selling Shareholders to Indemnify and Right of
    Set-Off


    

     

    The
Selling Shareholders will indemnify, defend, and hold harmless, to the full
extent of the law, Catalyst and its shareholders from, against, and in respect
of any and all Losses asserted against, relating to, imposed upon, or incurred
by Catalyst and its shareholders by reason of, resulting from, based upon or
arising out of:

     

    
      	
               
      

            	
              (A)

            	
              any
      breach by the Selling Shareholders of  this Agreement;
      or

            


    

     

    
      	
               
      

            	
              (B)

            	
              any
      misstatement, misrepresentation or breach of the representations and
      warranties made by the Selling Shareholders contained in or made pursuant
      to the Questionnaires executed by each Selling Shareholder as part of the
      share exchange procedure detailed in  this
      Agreement.

            


    

     

    (C)           to
the extent of any breach of the warranties and representations contained herein
and by way of inclusion and not exclusion,  Catalyst in its sole and
absolute discretion may offset  any amounts due the Selling
Shareholders pursuant to the Convertible Debenture
Agreement.   On notice from Catalyst to the selling
shareholders,  the amount of any liability shall be immediately offset
against any amounts due under the
Convertible  Debenture.    Notwithstanding the
foregoing,  in the event that it is determined that there is no
liability or case of action for breach,  then in that event the full
amount of the Convertible Debenture shall be due the Selling
Shareholders

     

    
      
        
        

      

      
        -24-

        
          

        

      

      
        
        

      

    

     

    (D)           if
following issuance of the Catalyst shares of common stock it is determined that
there is a breach of this agreement,  in addition to other remedies
set forth herein,  Catalyst may instruct the Company’s transfer agent
to place a stop transfer legend or notice on the Common Stock.  No
bond or other security shall be required for the placement of a stop transfer
order.

     

    
      	
              9.4          
      

            	
              Agreement
      of Catalyst to Indemnify

            


    

     

    Catalyst
will indemnify, defend, and hold harmless, to the full extent of the law,
Company and the Selling Shareholders from, against, for, and in respect of any
and all Losses asserted against, relating to, imposed upon, or incurred by
Company and the Selling Shareholders by reason of, resulting from, based upon or
arising out of:

     

    
      	
               
      

            	
              (A)
      the breach by Catalyst of any representation or warranty of Catalyst
      contained in or made pursuant to this Agreement, any Catalyst Document or
      any certificate or other instrument delivered pursuant to this Agreement;
      or

            


    

     

    
      	
               
      

            	
              (B)
      the breach or partial breach by Catalyst of any covenant or agreement of
      Catalyst made in or pursuant to this Agreement, any Catalyst Document or
      any certificate or other instrument delivered pursuant to this
      Agreement.

            


    

     

    
      	
              10.

            	
              MISCELLANEOUS
      PROVISIONS

            


    

     

    
      	
              10.1        
      

            	
              Effectiveness
      of Representations; Survival

            


    

     

    Each
party is entitled to rely on the representations, warranties and agreements of
each of the other parties and all such representation, warranties and agreement
will be effective regardless of any investigation that any party has undertaken
or failed to undertake.  Unless otherwise stated in this Agreement,
and except for instances of fraud, the representations, warranties and
agreements will survive the Closing Date and continue in full force and effect
until three (3) years after the Closing Date.

     

    
      	
              10.2        
      

            	
              Further
      Assurances

            


    

     

    Each of
the parties hereto will co-operate with the others and execute and deliver to
the other parties hereto such other instruments and documents and take such
other actions as may be reasonably requested from time to time by any other
party hereto as necessary to carry out, evidence, and confirm the intended
purposes of this Agreement.

     

    
      	
              10.3        
      

            	
              Amendment

            


    

     

    This
Agreement may not be amended except by an instrument in writing signed by each
of the parties.

     

    
      	
              10.4        
      

            	
              Expenses

            


    

     

    Each
party  will bear their own costs and expenses in connection with the
execution of this Agreement.  Payment for delivery of  the
audited financial statements will be the responsibility of the Seller unless
agreed to the contrary  in writing by all parties

     

    
      
        
        

      

      
        -25-

        
          

        

      

      
        
        

      

    

     

    
      	
              10.5        
      

            	
              Entire
      Agreement

            


    

     

    This
Agreement, the schedules attached hereto and the other documents in connection
with this transaction contain the entire agreement between the parties with
respect to the subject matter hereof and supersede all prior arrangements and
understandings, both written and oral, expressed or implied, with respect
thereto.  Any preceding correspondence or offers are expressly
superseded and terminated by this Agreement.

     

    
      	
              10.6        
      

            	
              Notices

            


    

     

    All
notices and other communications required or permitted under this Agreement must
be in writing and will be deemed given if sent by personal delivery, faxed with
electronic confirmation of delivery, internationally-recognized express courier
or registered or certified mail (return receipt requested), postage prepaid, to
the parties at their then place of business or residence.  Each party
undertakes to provide each of the other parties notice of any
address.

     

    All such
notices and other communications will be deemed to have been
received:

     

    in the
case of personal delivery, on the date of such delivery;

     

    
      	
               
      

            	
              in
      the case of a fax or electronic mail, on the date of such
      delivery;

            


    

     

    
      	
               
      

            	
              in
      the case of delivery by internationally-recognized express courier, on the
      business day following dispatch;
and

            


    

     

    
      	
               
      

            	
              in
      the case of mailing, on the fifth business day following
      mailing.

            


    

     

    
      	
              10.7        
      

            	
              Headings

            


    

     

    The
headings contained in this Agreement are for convenience purposes only and will
not affect in any way the meaning or interpretation of this
Agreement.

     

    
      	
              10.8        
      

            	
              Benefits

            


    

     

    This
Agreement is and will only be construed as for the benefit of or enforceable by
those persons party to this Agreement.

     

    
      	
              10.9        
      

            	
              Assignment

            


    

     

    This
Agreement or the Convertible Debenture  may not be assigned (except by
operation of law) by any party without the consent of the other
parties.

     

    
      
        
        

      

      
        -26-

        
          

        

      

      
        
        

      

    

     

    
      	
              10.10      
      

            	
              Governing
      Law

            


    

     

    Governing
Law.  This Debenture shall be governed by, and construed in
accordance with, the laws of the State of Delaware  (without giving
effect to conflicts of laws principles).  With respect to any suit,
action or proceedings relating to this Debenture, the Company irrevocably
submits to the exclusive jurisdiction of the courts of located in San Jose,
California, and hereby waives, to the fullest extent permitted by applicable
law, any claim that any such suit, action or proceeding has been brought in an
inconvenient forum.  Subject to applicable law, the Company agrees
that final judgment against it in any legal action or proceeding arising out of
or relating to this Debenture shall be conclusive and may be enforced in any
other jurisdiction within or outside the United States by suit on the judgment,
a certified copy of which judgment shall be conclusive evidence thereof and the
amount of its indebtedness, or by such other means provided by law.

     

    
      	
              10.11      
      

            	
              Construction

            


    

     

    The
language used in this Agreement will be deemed to be the
language chosen by the parties to express their mutual intent, and no
rule of strict construction will be applied against any party.

     

    
      	
              10.12     
      

            	
              Gender

            


    

     

    All
references to any party will be read with such changes in number and gender as
the context or reference requires.

     

    
      	
              10.13      
      

            	
              Business
      Days

            


    

     

    If the
last or appointed day for the taking of any action required or the expiration of
any rights granted herein shall be a Saturday, Sunday or a legal holiday in the
State of Delaware, then such action may be taken or right may be exercised on
the next succeeding day which is not a Saturday, Sunday or such a legal
holiday.

     

    
      	
              10.14      
      

            	
              Counterparts

            


    

     

    This
Agreement may be executed in one or more counterparts, all of which will be
considered one and the same agreement and will become effective when one or more
counterparts have been signed by each of the parties and delivered to the other
parties, it being understood that all parties need not sign the same
counterpart.

     

    
      	
              10.15      
      

            	
              Fax
      Execution

            


    

     

    This
Agreement may be executed by delivery of executed signature pages by fax and
such fax execution will be effective for all purposes.

     

    
      	
              10.16 
          

            	
              Schedules
      and Exhibits

            


    

     

    The
schedules and exhibits are attached to this Agreement and incorporated
herein.

     

    
      
        
        

      

      
        -27-

        
          

        

      

      
        
        

      

    

     

    THE
COMPANY AND THE SELLING SHAREHOLDER WARRANT AND REPRESENT THAT EACH HAS HAD THIS
AGREEEMENT REVIEWED BY LEGAL COUNSEL AND/OR HAD THE OPPORTUNITY TO DISCUSS THE
TERMS AND CONDITIONS WITH LEGAL COUNSEL OR A PROFESSIONAL ADVSISOR.

     

    IN WITNESS WHEREOF the parties
hereto have executed this Agreement as of the day and year first above
written.

     

    Catalyst
Group Holding Incorporated

    
 

     

    By:           /s/ Kenneth
Green                               


    Authorized Signatory

    By: Kenneth Green,
president

     

     

    Real
Estate Promotional Services, Inc.

    
 

     

    By:             /s/ Jeff
Crowe                                       

      By:  Jeff Crowe,
president

     

     

     

    Selling
Shareholder

     

    /s/ Jeff
Crowe                                       

    Jeff
Crowe

     

    


     

    


    
      
        
        

      

      
        -28-

        
          

        

      

      
        
        

      

    

     

                                                                       

    
    

     

    
      	Schedule
      1 	List of
      Shareholders
	 	 
	Name 	No. of
    Shares
	 	 
	Jeff
      Crowe   	100


    

     

     

     

    No other
shareholders or outstanding shares

     

     

    


     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    


     

     

    Schedule
2.                      Financial
Statements

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    


     

    Schedule
3.                      Form
of Convertible Debenture

     

    
       

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

    

     

    
       

      


      CONVERTIBLE
DEBENTURE

      


      


      THIS
SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE “SECURITIES ACT”), OR THE SECURITIES LAWS OF ANY STATE, AND IS BEING
OFFERED AND SOLD PURSUANT TO AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF
THE SECURITIES ACT AND SUCH LAWS.  THIS SECURITY MAY NOT BE SOLD OR
TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT OR SUCH OTHER LAWS.


       

      FORM
OF CONVERTIBLE DEBENTURE

       

      


      Company: Catalyst Group
Holdings Corp.

      Company Address: 1739
Creekstone Circle, San Jose, California  95133

      Closing Date:  As
set forth in the Purchase and Share Exchange Agreement

      Maturity Date: Six month
anniversary of the Closing Date.

      Principal Amount:
$250,000

      Interest
Rate:  10% per annum payable in
full on the Maturity Date

      Conversion
Ratio:  one (1) share of common stock for every $1.00 of
Debt

      Holder:
Rep’s Web

       

      Catalyst
Group Holdings Corp.,  a Delaware corporation, and any successor or
resulting corporation by way of merger, consolidation, sale or exchange of all
or substantially all of the assets or otherwise  (the “Company”), for value
received, hereby promises to pay to the Holder (as such term is hereinafter
defined), or such other Person (as such term is hereinafter defined) upon order
of the Holder, on the Maturity Date, the Principal Amount (as such term is
hereinafter defined), as such sum may be adjusted pursuant to this Convertible
Debenture, and to pay interest thereon from the Closing Date, at the rate of
ten  percent (10.0%) per annum (the “Debenture Interest Rate”),
until the Principal Amount of this Debenture has been paid in
full.  All interest payable on the Principal Amount of this Debenture
shall be calculated on the basis of a 360-day year for the actual number of days
elapsed.  Payment of  principal or interest  or
both of  this Debenture shall be in cash or, at the option of the
Company, in shares of Common Stock of the Company valued at the then applicable
Conversion Price (as defined herein).

       

      


       

      DEFINITIONS

       

                     
SECTION 1.2       
  Definitions.  The
terms defined in this Article whenever used in this Debenture have the following
respective meanings:

       

      (i) “Affiliate” has the meaning
ascribed to such term in Rule 12b-2 under the Securities Exchange Act of 1934,
as amended.

       

      (ii) “Bankruptcy Code” means the
United States Bankruptcy Code of 1986, as amended (11 U.S.C. §§ 101 et. seq.).

       

      (iii) “Business Day” means a day
other than Saturday, Sunday or any day on which banks located in the State of
California are authorized or obligated to close.

       

      (iv) “Capital Shares” means the
Common Stock and any other shares of any other class or series of capital stock,
whether now or hereafter authorized and however designated, which have the right
to participate in the distribution of earnings and assets (upon dissolution,
liquidation or winding-up) of the Company.

       

      (v) “Common Shares” or “Common Stock” means shares of
the Company’s Common Stock.

       

      (vi) “Common Stock Issued at
Conversion”, when used with reference to the securities deliverable upon
conversion of this Debenture, means all Common Shares now or hereafter
Outstanding and securities of any other class or series into which this
Debenture hereafter shall have been changed or substituted, whether now or
hereafter created and however designated.

       

      (vii) “Conversion” or “conversion” means the
repayment by the Company of the Principal Amount of this Debenture by the
delivery of Common Stock on the terms provided in Section 3,  and
“convert,” “converted,” “convertible” and like words
shall have a corresponding meaning.

       

      

       

      
        
          
          

        

        
          1

          
            

          

        

        
          
          

        

      

       

      (viii) “Conversion Date” means any
day on which all or any portion of the Principal Amount of this Debenture is
converted in accordance with the provisions hereof.

       

      (ix) “Conversion Notice” means a
written notice of conversion substantially in the form annexed hereto as Exhibit
A.

       

      (x) “Conversion Ratio” on any date
of determination means the applicable ratio f for the conversion of this
Debenture into Common Shares on such day as set forth in Section 3.

       

      (xi) Debenture” or “Debentures” means this
Convertible Debenture of the Company or such other convertible debenture(s)
exchanged therefor as provided in Section 2.1.

       

      (xii) “Event of Default” has the
meaning set forth in Section 6.1.

       

      (xiii) “Holder” means the person or
entity to which this Debenture is issued, any successor thereto, or any Person
to whom this Debenture is subsequently transferred in accordance with the
provisions hereof.

       

      (xiv) “Maximum Rate” has the meaning
set forth in Section 6.4.

       

      (xv) “Outstanding” when used with
reference to Common Shares or Capital Shares (collectively, “Shares”) means, on any date
of determination, all issued and outstanding Shares, and includes all such
Shares issuable in respect of outstanding scrip or any certificates representing
fractional interests in such Shares; provided, however, that any
such Shares directly or indirectly owned or held by or for the account of the
Company or any Subsidiary of the Company shall not be deemed “Outstanding” for purposes
hereof.

       

      (xvi) “Person” means an individual,
a corporation, a partnership, an association, a limited liability company, an
unincorporated business organization, a trust or other entity or organization,
and any government or political subdivision or any agency or instrumentality
thereof.

       

      (xvii) “Principal Amount” means, for
any date of calculation, the principal sum set forth in the first paragraph of
this Debenture.

       

      (xviii) “SEC” means the United States
Securities and Exchange Commission.

       

      (xix) “Securities Act” means the
Securities Act of 1933, as amended, and the rules and regulations of the SEC
thereunder, all as in effect at the time.

       

      (xx) “Subsidiary” means any entity
of which securities or other ownership interests having ordinary voting power to
elect a majority of the board of directors or other persons performing similar
functions are owned directly or indirectly by the Company.

       

      All
references to “cash” or “$” herein means currency of the United States of
America.

      

       

      
        
          
          

        

        
          2

          
            

          

        

        
          
          

        

      

       

      ARTICLE
2

       

      EXCHANGES,
TRANSFER AND REPAYMENT

       

      SECTION
2.1                                           Registration of Transfer of
Debentures. This Debenture, when presented for registration of transfer,
shall (if so required by the Company) be duly endorsed, or be accompanied by a
written instrument of transfer in form reasonably satisfactory to the Company
duly executed, by the Holder duly authorized in writing.

       

      SECTION
2.2                                           Loss, Theft, Destruction of
Debenture.  Upon receipt of evidence satisfactory to the
Company of the loss, theft, destruction or mutilation of this Debenture and, in
the case of any such loss, theft or destruction, upon receipt of indemnity or
security reasonably satisfactory to the Company, or, in the case of any such
mutilation, upon surrender and cancellation of this Debenture, the Company shall
make, issue and deliver, in lieu of such lost, stolen, destroyed or mutilated
Debenture, a new Debenture of like tenor and unpaid Principal Amount dated as of
the date hereof.  This Debenture shall be held and owned upon the
express condition that the provisions of this Section 2.2 are exclusive with
respect to the replacement of a mutilated, destroyed, lost or stolen Debenture
and shall preclude any and all other rights and remedies notwithstanding any law
or statute existing or hereafter enacted to the contrary with respect to the
replacement of negotiable instruments or other securities without the surrender
thereof.

       

      SECTION
2.3                                           Who Deemed Absolute
Owner.  The Company may deem the Person in whose name this
Debenture shall be registered upon the registry books of the Company to be, and
may treat it as, the absolute owner of this Debenture (whether or not this
Debenture shall be overdue) for the purpose of receiving payment of or on
account of the Principal Amount of this Debenture, for the conversion of this
Debenture and for all other purposes, and the Company shall not be affected by
any notice to the contrary.  All such payments and such conversions
shall be valid and effectual to satisfy and discharge the liability upon this
Debenture to the extent of the sum or sums so paid or the conversion or
conversions so made.

       

      SECTION
2.4                                        
 Repayment at
Maturity.  At the Maturity Date, the Company, in its sole and
absolute discretion  may either repay the outstanding Principal Amount
of this Debenture in whole  or in part in cash, together with all
accrued and unpaid interest thereon, in cash, to the Maturity Date or, shall
convert the outstanding Principal Amount of this Debenture and accrued and
unpaid interest thereon, into common stock at the Conversion Ratio as calculated
pursuant to this Agreement.

       

      ARTICLE
3

       

      CONVERSION
OF DEBENTURE

       

      SECTION
3.1                                           Conversion; Conversion
Ratio; Valuation Event.  At the option of the Company, this
Debenture may be converted, either in whole or in part, up to the full Principal
Amount plus accrued interest  hereof into Common Shares at any time
and from time to time on any Business Day, subject to compliance with Section
3.2. The number of Common Shares into which this Debenture may be converted is
equal to the dollar amount of the Debenture being converted multiplied by one
(1)  the “Conversion Ratio”.  In the event of any
recapitalization or reorganization, the Conversion Ratio shall be adjusted
accordingly.

       

      SECTION
3.2                                           Exercise of Conversion
Privilege.  (a) Conversion of this Debenture may be exercised
on any Business Day by the Company or the Holder by telecopying an executed and
completed Conversion Notice to the Holder (the “Conversion
Date”).  The Company shall convert this Debenture and issue the Common
Stock Issued at Conversion in the manner provided below in this Section 3.2, and
all voting and other rights associated with the beneficial ownership of the
Common Stock Issued at Conversion shall vest with the Holder, effective as of
the Conversion Date at the time specified in the Conversion
Notice.  The Conversion Notice also shall state the name or names
(with addresses) of the persons who are to become the holders of the Common
Stock Issued at Conversion in connection with such conversion. As promptly as
practicable after the receipt of the Conversion Notice as aforesaid, but in any
event not more than five(5) Business Days after either
party’s  delivery of such Conversion Notice, the Company shall (i)
issue the Common Stock Issued at Conversion in accordance with the provisions of
this Article 3 and (ii) cause to be mailed for delivery by overnight courier a
certificate or certificate(s) representing the number of Common Shares to which
the Holder is entitled by virtue of such conversion, and cash, as provided in
Section 3.3, as applicable, representing the amount of accrued and unpaid
interest on this Debenture as of the Conversion Date if paid in
cash.  Such conversion shall be deemed to have been effected at the
time at which the Conversion Notice indicates, and at such time the rights of
the Holder of this Debenture, as such (except if and to the extent that any
Principal Amount thereof remains unconverted), shall cease and the Person and
Persons in whose name or names the Common Stock Issued at Conversion shall be
issuable shall be deemed to have become the holder or holders of record of the
Common Shares represented thereby, and all voting and other rights associated
with the beneficial ownership of such Common Shares shall at such time vest with
such Person or Persons.  The Conversion Notice shall constitute a
contract between the Holder and the Company, whereby the Holder shall be deemed
to subscribe for the number of Common Shares which it will be entitled to
receive upon such conversion and, in payment and satisfaction of such
subscription to surrender this Debenture and to release the Company from all
liability thereon (except if and to the extent that any Principal Amount thereof
remains unconverted).  No cash payment aggregating less than $1.00
shall be required to be given unless specifically requested by the
Holder.

       

      

       

      
        
          
          

        

        
          3

          
            

          

        

        
          
          

        

      

       

      SECTION
3.3                                           Fractional
Shares.  No fractional Common Shares or scrip representing
fractional Common Shares shall be delivered upon conversion of this
Debenture.  Instead of any fractional Common Shares which otherwise
would be delivered upon conversion of this Debenture, the Company shall round up
to the next whole share.  No cash payment of less than $1.00 shall be
required to be given unless specifically requested by the Holder.

       

      SECTION
3.4                                           Adjustments.  The
Conversion Ratio  and the number of shares deliverable upon conversion
of this Debenture are subject to adjustment from time to time as
follows:

       

      (i) In
case the Company shall reorganize its capital, reclassify its capital stock,
consolidate or merge with or into another entity (where the Company is not the
survivor  (each, a “Fundamental Corporate
Change”)  the Conversion Ratio shall be adjusted to reflect the
Fundamental Corporate Change.

       

      SECTION
3.5                                           Surrender of
Debentures.  Upon any redemption of this Debenture or upon
maturity, the Holder shall either deliver this Debenture by hand to the Company
at its principal executive offices or surrender the same to the Company at such
address by nationally recognized overnight courier.  Payment of the
redemption price or the amount due on maturity shall be made by the Company to
the Holder against receipt of this Debenture (unless converted and paid in
common stock) by wire transfer of immediately available funds to such account(s)
as the Holder shall specify by written notice to the Company (if the Company has
not elected to pay this debenture with shares of its Common Stock.

       

      ARTICLE
4

       

      STATUS;   RESTRICTIONS
ON TRANSFER

       

      SECTION
4.1                                           Status of
Debenture.  This Debenture constitutes a legal, valid and
binding obligation of the Company, enforceable in accordance with its terms
subject, as to enforceability, to general principles of equity and to principles
of bankruptcy, insolvency, reorganization and other similar laws of general
applicability relating to or affecting creditors’ rights and remedies
generally.

       

      SECTION
4.2                                           Restrictions on
Transfer.  This Debenture, and any Common Shares deliverable
upon the conversion hereof, have not been registered under the Securities
Act.  The Holder by accepting this Debenture agrees that this
Debenture and the shares of Common Stock to be acquired as interest on and upon
conversion of this Debenture may not be assigned or otherwise transferred unless
and until (i) the Company has received the opinion of counsel for the Holder
that this Debenture or such shares may be sold pursuant to an exemption from
registration under the Securities Act or (ii) a registration statement relating
to this Debenture or such shares has been filed by the Company and declared
effective by the SEC.

       

      Each
certificate for shares of Common Stock deliverable hereunder shall bear a legend
as follows unless and until such securities have been sold pursuant to an
effective registration statement under the Securities Act:

       

      “The
securities represented by this certificate have not been registered under the
Securities Act of 1933, as amended (the “Securities Act”).  The
securities may not be offered for sale, sold or otherwise transferred except (i)
pursuant to an effective registration statement under the Securities Act or (ii)
pursuant to an exemption from registration under the Securities Act in respect
of which the issuer of this certificate has received an opinion of counsel
satisfactory to the issuer of this certificate to such effect.  Copies
of the agreement covering both the purchase of the securities and restrictions
on their transfer may be obtained at no cost by written request made by the
holder of record of this certificate to the Secretary of the issuer of this
certificate at the principal executive offices of the issuer of this
certificate.”

       

      ARTICLE
V.

       

      COVENANTS

       

      SECTION
5.1                                           Inspection of Property, Books
and Records.  So long as this Debenture shall be outstanding,
the Company shall keep proper books of record and account in which full, true
and correct entries shall be made of all material dealings and transactions in
relation to its business and activities and shall permit representatives of the
Holder at the Holder’s expense to visit and inspect any of its respective
properties, to examine and make abstracts from any of its respective books and
records, not reasonably deemed confidential by the Company, and to discuss its
respective affairs, finances and accounts with its respective officers and
independent public accountants, all at such reasonable times and as often as may
reasonably be desired.

       

      

       

      
        
          
          

        

        
          4

          
            

          

        

        
          
          

        

      

       

      ARTICLE
VI.

       

      EVENTS
OF DEFAULT; REMEDIES

       

      SECTION
6.1                                           Events of
Default.  “Event of Default” wherever
used herein means any one of the following events:

       

      A.The
Company shall default in the payment of principal of or interest on this
Debenture as and when the same shall be due and payable and, such default shall
continue for ten (10) Business Days after the date such payment was due, or the
Company shall fail to perform or observe any other covenant, agreement, term,
provision, undertaking or commitment under this Debenture, and such default
shall continue for a period of ten (10) Business Days after the delivery to the
Company of written notice that the Company is in default hereunder or
thereunder;

       

      B.Any of
the representations or warranties made by the Company herein, shall be false or
misleading in a material respect on the Closing Date;

       

      C (i).The
Company or any Subsidiary admits in writing its inability to pay its debts
generally or makes a general assignment for the benefit of creditors, (ii.)
institutes or has instituted against it any proceeding seeking  to
adjudicate it a bankrupt or insolvent, (iii.) liquidation, winding-up,
reorganization, arrangement, adjustment, protection, relief or composition of it
or its debts under any law relating to bankruptcy, insolvency, reorganization or
relief of debtors including any plan of compromise or arrangement or other
corporate proceeding involving or affecting its creditors or (iv) the entry of
an order for relief or the appointment of a receiver, trustee or other similar
person for it or for any substantial part of its properties and assets, and in
the case of any such official proceeding instituted against it (but not
instituted by it), either the proceeding remains undismissed or unstayed for a
period of sixty (60) calendar days, or any of the actions sought in such
proceeding (including the entry of an order for relief against it or the
appointment of a receiver, trustee, custodian or other similar official for it
or for any substantial part of its properties and assets) occurs or (v) takes
any corporate action to authorize any of the above actions;

       

      D.The
entry of a decree or order by a court having jurisdiction in the premises
adjudging the Company or any Subsidiary a bankrupt or insolvent, or approving as
properly filed a petition seeking reorganization, arrangement, adjustment or
composition of or in respect of the Company under the Bankruptcy Code or any
other applicable Federal or state law, or appointing a receiver, liquidator,
assignee, trustee or sequestrator (or other similar official) of the Company or
of any substantial part of its property, or ordering the winding-up or
liquidation of its affairs, and any such decree or order continues and is
unstayed and in effect for a period of sixty (60) calendar days;

       

      E.The
institution by the Company  of proceedings to be adjudicated a
bankrupt or insolvent, or the consent by it to the institution of bankruptcy or
insolvency proceedings against it, or the filing by it of a petition or answer
or consent seeking reorganization or relief under the Bankruptcy Code or any
other applicable federal or state law, or the consent by it to the filing of any
such petition or to the appointment of a receiver, liquidator, assignee, trustee
or sequestrator (or other similar official) of the Company or of any substantial
part of its property, or the making by it of an assignment for the benefit of
creditors, or the admission by it in writing of its inability to pay its debts
generally as and when they become due, or the taking of corporate action by the
Company in furtherance of any such action;

       

      F.A final
judgment or final judgments for the payment of money shall have been entered by
any court or courts of competent jurisdiction against the Company and remains
undischarged for a period (during which execution shall be effectively stayed)
of thirty (30) days, provided that the
aggregate amount of all such judgments at any time outstanding (to the extent
not paid or to be paid, as evidenced by a written communication to that effect
from the applicable insurer, by insurance) exceeds One Hundred Thousand Dollars
($100,000);

       

      G.It
becomes unlawful for the Company to perform or comply with its obligations under
this Debenture in any respect;

       

      SECTION
6.2                                           Acceleration of Maturity;
Rescission and Annulment.  If an Event of Default occurs and is
continuing, then and in every such case the Holder may, by a notice in writing
to the Company, rescind any outstanding Conversion Notice and declare that all
amounts owing or otherwise outstanding under this Debenture are immediately due
and payable and upon any such declaration this Debenture shall become
immediately due and payable in cash together with all accrued and unpaid
interest thereon.

       

      SECTION
6.3                                           Maximum Interest
Rate.                                           Notwithstanding
anything herein to the contrary, if at any time the applicable interest rate as
provided for herein shall exceed the maximum lawful rate which may be contracted
for, charged, taken or received by the Holder in accordance with any applicable
law (the “Maximum
Rate”), the rate of interest applicable to this Debenture shall be
limited to the Maximum Rate.  To the greatest extent permitted under
applicable law, the Company hereby waives and agrees not to allege or claim that
any provisions of this Note could give rise to or result in any actual or
potential violation of any applicable usury laws.

       

      SECTION
6.4                                           Remedies Not
Waived.  No course of dealing between the Company and the
Holder or any delay in exercising any rights hereunder shall operate as a waiver
by the Holder.

       

      SECTION
6.5                                       
    Remedies.  The
Company acknowledges that a breach by it of its obligations hereunder will cause
irreparable harm to the Holder, by vitiating the intent and purpose of the
transaction contemplated hereby. Accordingly, the Company acknowledges that the
remedy at law for a breach of its obligations under this Debenture will be
inadequate and agrees, in the event of a breach or threatened breach by the
Company of the provisions of this Debenture, that the Holder shall be entitled
to all other available remedies at law or in equity, and in addition to the
penalties assessable herein, to an injunction or injunctions restraining,
preventing or curing any breach of this Debenture and to enforce specifically
the terms and provisions thereof, without the necessity of showing economic loss
and without any bond or other security being required.

       

      

       

      
        
          
          

        

        
          5

          
            

          

        

        
          
          

        

      

       

      ARTICLE
VII.

       

      MISCELLANEOUS

       

      SECTION
7.1                                           Notice of Certain
Events.  In the case of the occurrence of any event described
in Section 3.4 of this Debenture, the Company shall cause to be mailed to the
Holder of this Debenture at its last address as it appears in the Company’s
security registry, at least twenty (20) days prior to the applicable record,
effective or expiration date hereinafter specified (or, if such twenty (20)
days’ notice is not possible, at the earliest possible date prior to any such
record, effective or expiration date), a notice thereof, including, if
applicable, a statement of (y) the date on which a record is to be taken for the
purpose of such dividend, distribution, issuance or granting of rights, options
or warrants, or if a record is not to be taken, the date as of which the holders
of record of Common Stock to be entitled to such dividend, distribution,
issuance or granting of rights, options or warrants are to be determined or (z)
the date on which such reclassification, consolidation, merger, sale, transfer,
dissolution, liquidation or winding-up is expected to become effective, and the
date as of which it is expected that holders of record of Common Stock will be
entitled to exchange their shares for securities, cash or other property
deliverable upon such reclassification, consolidation, merger, sale transfer,
dissolution, liquidation or winding-up.

       

      SECTION
7.2                                           Withholding.  To
the extent required by applicable law, the Company may withhold amounts for or
on account of any taxes imposed or levied by or on behalf of any taxing
authority in the United States having jurisdiction over the Company from any
payments made pursuant to this Debenture.

       

      SECTION
7.3                                           Transmittal of
Notices.  Except as may be otherwise provided herein, any
notice or other communication or delivery required or permitted hereunder shall
be in writing and shall be delivered personally, or sent by telecopier machine
or by a nationally recognized overnight courier service, and shall be deemed
given when so delivered personally, or by telecopier machine or overnight
courier to the Company at its principal place of business or to the Holder as
indicated on the Subscription Agreement.

       

      Each of
the Holder or the Company may change the foregoing address by notice given
pursuant to this Section 7.4.

       

      SECTION
7.4                                           Attorneys’
Fees.  Should any party hereto employ an attorney for the
purpose of enforcing or construing this Debenture, or any judgment based on this
Debenture, in any legal proceeding whatsoever, including insolvency, bankruptcy,
arbitration, declaratory relief or other litigation, the prevailing party shall
be entitled to receive from the other party or parties thereto reimbursement for
all reasonable attorneys' fees and all reasonable costs, including but not
limited to service of process, filing fees, court and court reporter costs,
investigative costs, expert witness fees, and the cost of any bonds, whether
taxable or not, and that such reimbursement shall be included in any judgment or
final order issued in that proceeding.  The "prevailing party" means
the party determined by the court to most nearly prevail and not necessarily the
one in whose favor a judgment is rendered.

       

      SECTION
7.5                                           Governing
Law.  This Debenture shall be governed by, and construed in
accordance with, the laws of the State of Delaware  (without giving
effect to conflicts of laws principles).  With respect to any suit,
action or proceedings relating to this Debenture, the Company irrevocably
submits to the exclusive jurisdiction of the courts of located in San Jose,
California, and hereby waives, to the fullest extent permitted by applicable
law, any claim that any such suit, action or proceeding has been brought in an
inconvenient forum.  Subject to applicable law, the Company agrees
that final judgment against it in any legal action or proceeding arising out of
or relating to this Debenture shall be conclusive and may be enforced in any
other jurisdiction within or outside the United States by suit on the judgment,
a certified copy of which judgment shall be conclusive evidence thereof and the
amount of its indebtedness, or by such other means provided by law.

       

      SECTION
7.6                                         
 Waiver of Jury
Trial. To the fullest extent permitted by law, each of the parties hereto
hereby knowingly, voluntarily and intentionally waives its respective rights to
a jury trial of any claim or cause of action based upon or arising out of this
Debenture or any other document or any dealings between them relating to the
subject matter of this Debenture and other documents.  Each party
hereto (i) certifies that neither of their respective representatives, agents or
attorneys has represented, expressly or otherwise, that such party would not, in
the event of litigation, seek to enforce the foregoing waivers and (ii)
acknowledges that it has been induced to enter into this Debenture by, among
other things, the mutual waivers and certifications herein.

       

      SECTION
7.7                                        
  Headings.  The
headings of the Articles and Sections of this Debenture are inserted for
convenience only and do not constitute a part of this Debenture.

       

      SECTION
7.8                                           Payment
Dates.  Whenever any payment hereunder shall be due on a day
other than a Business Day, such payment shall be made on the next succeeding
Business Day.

       

      SECTION
7.9                                         
  Binding
Effect.  Each Holder by accepting this Debenture agrees to be
bound by and comply with the terms and provisions of this
Debenture.

       

      SECTION
7.10                                        
 No Stockholder
Rights.  Except as otherwise provided herein, this Debenture
shall not entitle the Holder to any of the rights of a stockholder of the
Company, including, without limitation, the right to vote, to receive dividends
and other distributions, or to receive any notice of, or to attend, meetings of
stockholders or any other proceedings of the Company, unless and to the extent
converted into shares of Common Stock in accordance with the terms
hereof.

       

      SECTION
7.11                                        
 Facsimile
Execution.    Facsimile execution shall be deemed
originals.

       

      

       

      
        
          
          

        

        
          6

          
            

          

        

        
          
          



      

      IN
WITNESS WHEREOF, the Company has caused this Debenture to be signed by its duly
authorized officer on the date of this Debenture.

       

      Rep’s Web
 

       

                                                                                      Jeff
Crowe

       

       

      Catalyst
Group Holdings Corp.

      
 

       

      Title:
_________________________________

       

       

      


       

      
        
          
          

        

        
          7

          
            

          

        

        
          
          

        

      

      


       

      EXHIBIT A

       

      DEBENTURE CONVERSION
NOTICE

       

      


      TO:           HOLDER

       

      Catalyst
Group Holdings Corp. (the “Company”) hereby irrevocably
exercises its option to convert $__________ Principal Amount and $______________
Interest of the Debenture into shares of Common Stock in accordance with the
terms of the Debenture.  The Common Stock and certificates therefor
deliverable upon conversion, the Debenture reissued in the Principal Amount not
being surrendered for conversion hereby, [the check or shares of Common Stock in
payment of the accrued and unpaid interest thereon to the date of this Notice,]
shall be registered in the name of and/or delivered to the name set forth below
unless a different name has been provided to the Company.  All
capitalized terms used and not defined herein have the respective meanings
assigned to them in the Debenture.  The conversion pursuant hereto
shall be deemed to have been effected at the date and time specified below, and
at such time the rights of the Holder of the Principal Amount of the Debenture
set forth above shall cease and the Person or Persons in whose name or names the
Common Stock Issued at Conversion shall be registered shall be deemed to have
become the holder or holders of record of the Common Shares represented thereby
and all voting and other rights associated with the beneficial ownership of such
Common Shares shall at such time vest with such Person or Persons.

       

      Date and
time:  

       

      


       

      ______________________________

       

      By:
___________________________

       

      Title:
_________________________ 

       

      Fill in
for registration of Debenture:

       

      Please
print name and address

       

      (including
ZIP code number):

       

       

      ______________________________

       

       

      

      
 

      
        
          
          

        

        
          8

          
            

          

        

        
          
          

        

      

       

      EXHIBIT A-1

       

      DEBENTURE CONVERSION
NOTICE

       

      


      TO:           Catalyst
Group Holdings Corp. (the “Company”)

       

      ____________
(the “Holder ”) hereby
irrevocably exercises its option to convert $__________ Principal Amount and
$______________ Interest of the Debenture into shares of Common Stock in
accordance with the terms of the Debenture.  The Common Stock and
certificates therefor deliverable upon conversion, the Debenture reissued in the
Principal Amount not being surrendered for conversion hereby, [the check or
shares of Common Stock in payment of the accrued and unpaid interest thereon to
the date of this Notice,] shall be registered in the name of and/or delivered to
the name set forth below unless a different name has been provided to the
Company.  All capitalized terms used and not defined herein have the
respective meanings assigned to them in the Debenture.  The conversion
pursuant hereto shall be deemed to have been effected at the date and time
specified below, and at such time the rights of the Holder of the Principal
Amount of the Debenture set forth above shall cease and the Person or Persons in
whose name or names the Common Stock Issued at Conversion shall be registered
shall be deemed to have become the holder or holders of record of the Common
Shares represented thereby and all voting and other rights associated with the
beneficial ownership of such Common Shares shall at such time vest with such
Person or Persons.

       

      Date and
time:  __________________

       

      


       

      ______________________________

       

      By:
___________________________

       

      Title:
_________________________

       

      Fill in
for registration of Debenture:

       

      Please
print name and address

       

      (including
ZIP code number):

       

       
 

       

      ______________________________