**EXHIBIT 10.7**

 

**SECURITIES PURCHASE AGREEMENT**

 

This SECURITIES PURCHASE AGREEMENT (this “Agreement”),dated as of March 8, 2006, is made by and among DynTek, Inc., aDelaware corporation, with headquarters located at 19700 Fairchild Road, Suite 230,Irvine, California 92612 (the “Company”), and the investors named on thesignature pages hereto, together with their permitted transferees (each,an “Investor” and collectively, the “Investors”).

 

**RECITALS:**

 

A.            TheCompany and the Investors are executing and delivering this Agreement inreliance upon the exemption from securities registration afforded by Section 4(2) ofthe Securities Act and Rule 506 under Regulation D.

 

B.            TheInvestors desire, upon the terms and conditions stated in this Agreement, topurchase in the aggregate up to 225,000,000 shares of the Company’s CommonStock (the “Common Shares”) and warrants, in the form of Exhibit Ahereto, to purchase such number of shares of the Company’s Common Stock (the “WarrantShares”) equal to twenty percent (20%) of the Common Shares, rounded down tothe nearest whole share (the “Warrants,” and collectively with the CommonShares, the “Securities”), for an aggregate purchase price of up to FourMillion Five Hundred Thousand Dollars ($4,500,000).  The purchase price per share for each CommonShare and corresponding Warrant is $0.02.

 

C.            Contemporaneouslywith the execution and delivery of this Agreement, the parties hereto areexecuting and delivering a Registration Rights Agreement under which theCompany has agreed to provide certain registration rights under the SecuritiesAct, the rules and regulations promulgated thereunder and applicable statesecurities laws.

 

D.            Thecapitalized terms used herein and not otherwise defined have the meanings giventhem in Article IX hereof.

 

In consideration of the premises and the mutualcovenants contained herein and other good and valuable consideration, thereceipt and sufficiency of which are hereby acknowledged, the Company and theInvestors hereby agree as follows:

 

# **ARTICLE IPURCHASE AND SALE OF SECURITIES**

# ** **

## 1.1           Purchaseand Sale of Securities.  At theClosing, subject to the terms of this Agreement and the satisfaction or waiverof the conditions set forth in Articles VI and VII hereof, the Company willissue and sell to each Investor, and each Investor will (on a several and not ajoint basis) purchase from the Company, the number of Securities set forthbeneath such Investor’s name on the signature pages hereof.

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## 1.2           Closing.

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### (a)           Theseparate purchases and sales of an aggregate of up to 225,000,000 Shares, foran aggregate purchase price of up to $4,500,000, shall take place at the Closingto be held at 10:00 a.m. local time at the offices of Stradling YoccaCarlson & Rauth, 660 Newport Center

 

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Drive, Suite 1600, Newport Beach, CA  92660 on March 8, 2006 (the “First ClosingDate”), or at such other time or place as the parties mutually agree.  At or prior to the First Closing Date, eachInvestor will pay the purchase price for the number of Securities set forthbeneath its name on the signature pages hereof, by wire transfer ofimmediately available funds in accordance with the wire instructions set forthon Exhibit B hereto.  TheCompany shall deliver to each Investor the deliverables identified in Article VIIon the First Closing Date and certificates representing the Common Shares sopurchased by such Investor within five (5) business days following the FirstClosing Date against delivery of the purchase price.

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### (b)           After the FirstClosing Date, the Company may sell, on the same terms and conditions as thosecontained in this Agreement, an aggregate of up to 225,000,000 Shares less thenumber of Shares sold on the First Closing Date, for an aggregate purchaseprice of up to $4,500,000 less the aggregate purchase price received on theFirst Closing Date, to one or more Investors (the “Additional Investors”),provided that (i) such subsequent sale is consummated prior to March 31,2006, unless extended by the Company for a period of up to ninety (90) daysfrom such date, without notice to any Investors (the “Second Closing Date”),and (ii) each Investor becomes a party to this Agreement and the RegistrationRights Agreement in the form attached hereto as Exhibit C.  At or prior to the Second Closing Date, eachInvestor will pay the purchase price for the number of Securities set forthbeneath its name on the signature pages hereof, by wire transfer ofimmediately available funds in accordance with the wire instructions set forthon Exhibit B hereto.  TheCompany shall deliver to each Additional Investor the deliverables identifiedin Article VII on the Second Closing Date and certificates representingthe Common Shares so purchased by such Additional Investor within five (5) businessdays following the Second Closing Date against delivery of the purchase price.

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# **ARTICLE IIINVESTOR’S REPRESENTATIONS AND WARRANTIES**

# ** **

Each Investor represents and warrants to the Company,severally and solely with respect to itself and its purchase hereunder and notwith respect to any other Investor, that:

 

## 2.1           InvestmentPurpose.  The Investor is purchasingthe Securities for its own account and not with a present view toward thepublic sale or distribution thereof, except pursuant to sales registered orexempted from registration under the Securities Act; provided, however, that bymaking the representation herein, the Investor does not agree to hold any ofthe Securities for any minimum or other specific term and reserves the right todispose of the Securities at any time in accordance with or pursuant to aregistration statement or an exemption from registration under the SecuritiesAct.

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## 2.2           AccreditedInvestor Status.  The Investor is an “accreditedinvestor” as defined in Rule 501(a) of Regulation D.  The Investor has delivered an Investor Questionnairein the form of Exhibit D to the Company.

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## 2.3           Relianceon Exemptions.  The Investorunderstands that the Securities are being offered and sold to it in relianceupon specific exemptions from the registration requirements of United Statesfederal and state securities laws and that the Company is relying upon thetruth and accuracy of, and the Investor’s compliance with, the representations,warranties, agreements, 

 

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## acknowledgments and understandings of the Investor setforth herein in order to determine the availability of such exemptions and theeligibility of the Investor to acquire the Securities.

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## 2.4           Information.  The Investor and its advisors, if any, havebeen furnished with all materials relating to the business, finances andoperations of the Company, and materials relating to the offer and sale of theSecurities, that have been requested by the Investor or its advisors, ifany.  The Investor and its advisors, ifany, have been afforded the opportunity to ask questions of the Company.  Neither such inquiries nor any other duediligence investigation conducted by Investor or any of its advisors orrepresentatives modify, amend or affect the Investor’s right to rely on theCompany’s representations and warranties contained in Article IIIbelow.  The Investor acknowledges andunderstands that its investment in the Securities involves a significant degreeof risk.

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## 2.5           GovernmentalReview.  The Investor understandsthat no United States federal or state agency or any other government orgovernmental agency has passed upon or made any recommendation or endorsementof the Securities or an investment therein.

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## 2.6           Transferor Resale.  The Investor understandsthat:

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### (a)           except asprovided in the Registration Rights Agreement, the Securities have not been andare not being registered under the Securities Act or any applicable statesecurities laws and, consequently, the Investor may have to bear the risk ofowning the Securities for an indefinite period of time because the Securitiesmay not be transferred unless (i) the resale of the Securities isregistered pursuant to an effective registration statement under the SecuritiesAct; (ii) the Investor has delivered to the Company an opinion of counsel(in form, substance and scope customary for opinions of counsel in comparabletransactions) to the effect that the Securities to be sold or transferred maybe sold or transferred pursuant to an exemption from such registration; (iii) theSecurities are sold or transferred pursuant to Rule 144; or (iv) theSecurities are sold or transferred to an affiliate (as defined in Rule 144)of the Investor;

###  

### (b)           any saleof the Securities made in reliance on Rule 144 may be made only inaccordance with the terms of Rule 144 and, if Rule 144 is notapplicable, any resale of the Securities under circumstances in which theseller (or the person through whom the sale is made) may be deemed to be anunderwriter (as that term is defined in the Securities Act) may require compliancewith some other exemption under the Securities Act or the rules andregulations of the SEC thereunder; and

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### (c)           except asset forth in the Registration Rights Agreement, neither the Company nor anyother person is under any obligation to register the Securities under theSecurities Act or any state securities laws or to comply with the terms andconditions of any exemption thereunder.

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## 2.7           Legends.  The Investor understands that until (a) theSecurities may be sold by the Investor under Rule 144(k) or (b) suchtime as the resale of the Securities has been registered under the SecuritiesAct as contemplated by the Registration Rights Agreement, the certificatesrepresenting the Securities will bear a restrictive legend in substantially thefollowing form (and a stop-transfer order may be placed against transfer of thecertificates for such Securities):

 

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THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVENOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR THESECURITIES LAWS OF ANY STATE OF THE UNITED STATES.  THE SECURITIES MAY NOT BE SOLD,TRANSFERRED OR ASSIGNED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENTFOR THE SECURITIES UNDER APPLICABLE SECURITIES LAWS, OR UNLESS OFFERED, SOLD ORTRANSFERRED PURSUANT TO AN AVAILABLE EXEMPTION FROM THE REGISTRATIONREQUIREMENTS OF THOSE LAWS.

 

The legend set forth above will be removed and theCompany will issue a certificate without the legend to the holder of anycertificate upon which it is stamped, in accordance with the terms of Article Vhereof.

 

## 2.8           Authorization;Enforcement.  This Agreement and theRegistration Rights Agreement have been duly and validly authorized, executedand delivered on behalf of the Investor and are valid and binding agreements ofthe Investor enforceable in accordance with their terms, subject to the effectof any applicable bankruptcy, insolvency, reorganization, moratorium or similarlaws affecting the rights of creditors generally and the application of generalprinciples of equity.

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## 2.9           Residency.  The Investor is a resident of (or, if anentity, has its principal place of business in) the jurisdiction set forthimmediately below such Investor’s name on the signature pages hereto.

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# **ARTICLE IIIREPRESENTATIONS AND WARRANTIES OF THE COMPANY**

# ** **

Except as otherwise set forth in the Company SECFilings, or in a schedule of exceptions delivered by the Company to theInvestors simultaneously with the execution of this Agreement (the “Schedule ofExceptions”), which identifies exceptions by specific Section references(provided that any information set forth in any one section of the Schedule ofExceptions shall be deemed to apply to each other applicable Section orsubsection thereof if its relevance to the information called for in such Section orsubsection is reasonably apparent), the Company hereby represents andwarrants to the Investors that:

 

## 3.1           Organizationand Qualification.  Each of theCompany and its Significant Subsidiary is duly incorporated, validly existingand in good standing under the laws of the jurisdiction in which it isincorporated, with full power and authority (corporate and other) to own,lease, use and operate its properties and to carry on its business as and wherenow owned, leased, used, operated and conducted.  Each of the Company and its SignificantSubsidiary is duly qualified to do business and is in good standing in everyjurisdiction in which the nature of the business conducted by it makes suchqualification necessary, except where the failure to be so qualified or in goodstanding would not have a Material Adverse Effect.  Each of the Company and its SignificantSubsidiary have taken all necessary action to qualify to do business and be ingood standing in every jurisdiction in which the nature of the businessconducted by it makes such qualification necessary, except where the failure tobe so qualified or in good standing would not have a Material Adverse Effect.

 

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## 3.2           Authorization;Enforcement.  (a) The Companyhas all requisite corporate power and authority to enter into and to performits obligations under this Agreement, the Registration Rights Agreement and theWarrants, to consummate the transactions contemplated hereby and thereby and toissue the Common Shares, the Warrants and the Warrant Shares issuable uponexercise of the Warrants in accordance with the terms hereof and thereof; (b) theexecution, delivery and performance of this Agreement, the Registration RightsAgreement and the Warrants by the Company and the consummation by it of thetransactions contemplated hereby and thereby (including without limitation theissuance of the Common Shares, the Warrants and the Warrant Shares issuableupon exercise of the Warrants) have been duly authorized by the Company’s Boardof Directors and no further consent or authorization of the Company, its Boardor Directors, or its stockholders is required; (c) this Agreement, theRegistration Rights Agreement and the Warrants have been duly executed by theCompany; and (d) each of this Agreement, the Registration Rights Agreementand the Warrants constitutes a legal, valid and binding obligation of theCompany enforceable against the Company in accordance with its terms, subjectto the effect of any applicable bankruptcy, insolvency, reorganization, ormoratorium or similar laws affecting the rights of creditors generally and theapplication of general principles of equity.

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## 3.3           Capitalization.  As of the date hereof, the authorized capitalof the Company consists of 450,000,000 shares of Common Stock, $.0001 par valueper share, and 10,000,000 shares of preferred stock, $.0001 par value per share(“Preferred Stock”).  As of February 15,2006, there were 81,164,636 shares of Common Stock issued and outstanding andno shares of Preferred Stock issued and outstanding.  Except as disclosed in Section 3.3 ofthe Schedule of Exceptions or in the Company SEC Filings, there are nooptions, warrants and convertible securities of the Company, and any otherrights to acquire securities of the Company. All outstanding securities of the Company are validly issued, fully paidand nonassessable.  No stockholder of theCompany is entitled to any preemptive rights with respect to the purchase of orsale of any securities by the Company.

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## 3.4           Issuanceof Securities.  The Securities areduly authorized and, upon issuance in accordance with the terms of thisAgreement, will be validly issued, fully paid and non-assessable, free from alltaxes, liens, claims, encumbrances and charges with respect to the issuethereof, will not be subject to preemptive rights or other similar rights ofstockholders of the Company, and will not impose personal liability on theholders thereof.  The Company hasreserved a sufficient number of shares of Common Stock for issuance uponexercise of the Warrants, and upon payment of the exercise price and exerciseof the Warrants in accordance with its terms, the Warrant Shares will bevalidly issued, fully paid and non-assessable, free from all taxes, liens,claims, encumbrances and charges with respect to the issue thereof, will not besubject to preemptive rights or other similar rights of stockholders of theCompany and will not impose personal liability on the holders thereof.

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## 3.5           NoConflicts; No Violation.

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### (a)           Theexecution, delivery and performance of this Agreement, the Registration RightsAgreement and the Warrants by the Company and the consummation by the Companyof the transactions contemplated hereby and thereby (including, withoutlimitation, the issuance of the Common Shares, the Warrants and the WarrantShares issuable upon exercise of the Warrants) will not (i) conflict withor result in a violation of any provision of its Second Amended and Restated Certificateof Incorporation (the “Company Certificate”) or bylaws, as amended (the “Bylaws”)or (ii) violate or conflict with, or result in a breach of any provisionof, or constitute a default (or an event which with notice or lapse of time orboth could become a default) under, or give to others any rights oftermination, amendment, acceleration or cancellation of, any agreement,indenture, patent, 

 

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### patent license, orinstrument to which the Company or any Subsidiary is a party, (iii) resultin a violation of any law, rule, regulation, order, judgment or decree(including U.S. federal and state securities laws and the rules andregulations of any self-regulatory organizations to which the Company or anySubsidiary or any of the securities of the Company or any Subsidiary aresubject) applicable to the Company or any Subsidiary or by which any propertyor asset of the Company or its subsidiaries is bound or affected, or (iv) resultin the imposition of a Lien on any assets of the Company or any of itsSubsidiaries, except with respect to (ii), (iii) and (iv) above, forsuch conflicts, breaches, defaults, terminations, amendments, accelerations,cancellations, violations and impositions as would not, individually or in theaggregate, have a Material Adverse Effect.

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### (b)           TheCompany is not in violation of the Company Certificate or Bylaws, and noSubsidiary of the Company is in violation of its organizational documents.  Neither the Company nor any Subsidiary is indefault (and no event has occurred which with notice or lapse of time or bothcould put the Company in default) under any agreement, indenture or instrumentto which the Company or Subsidiary is a party or by which any property orassets of the Company or its Subsidiaries are bound or affected, except fordefaults as would not, individually or in the aggregate, have a MaterialAdverse Effect.

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### (c)           Neitherthe Company nor any Subsidiary is conducting its business in violation of anylaw, ordinance or regulation of any governmental entity, the failure to complywith which would, individually or in the aggregate, have a Material AdverseEffect.

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### (d)           Except asspecifically contemplated by this Agreement and as required under theSecurities Act and any applicable state securities laws or any listingagreement with any securities exchange or automated quotation system, neitherthe Company nor any Subsidiary is required to obtain any consent, authorizationor order of, or make any filing or registration with, any court or governmentalagency or any regulatory or self regulatory agency in order for the Company toexecute, deliver or perform any of its obligations under this Agreement, theRegistration Rights Agreement or the Warrants, in each case in accordance withthe terms hereof or thereof, or to issue and sell the Securities in accordancewith the terms hereof.  All consents,authorizations, orders, filings and registrations which the Company is requiredto obtain pursuant to the preceding sentence have been obtained or effected onor prior to the date hereof or are not required to be made or obtained untilafter the date hereof.

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3.6           SECFilings, Other Filings and Regulatory Compliance.  The Company has timely filed all registrationstatements, prospectuses, forms, reports, definitive proxy statements,schedules and documents required to be filed by it under the Securities Act orthe Exchange Act, as the case may be, since January 1, 2003 (collectively,the “Company SEC Filings”).  None of theCompany’s Subsidiaries is required to file periodic reports with the SECpursuant to the Exchange Act.  EachCompany SEC Filing (i) as of the time it was filed, complied in allmaterial respects with the requirements of the Securities Act, the Exchange Actand the Sarbanes-Oxley Act of 2002, as the case may be, and (ii) did not,at the time it was filed (or if subsequently amended or superseded by a CompanySEC Filing made on or prior to the date of this Agreement, then on the date ofsuch subsequent filing), contain any untrue statement of a material fact oromit to state a material fact required to be stated therein or necessary inorder to make the statements made therein, in light of the circumstances underwhich they were made, not misleading.  TheCompany has taken, or will have taken prior to the Closing, all necessaryactions to maintain eligibility of its Common Stock for trading on the OTCBulletin Board under all currently effective inclusion requirements.  Each balance sheet included in the CompanySEC Filings (including any related notes and schedules)

 

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fairly presents in all material respects the consolidated financialposition of the Company as of its date, and each of the other financialstatements included in the Company SEC Filings (including any related notes andschedules) fairly presents in all material respects the consolidated results ofoperations of the Company for the periods or as of the dates therein set forthin accordance with GAAP consistently applied during the periods involved (exceptas may be indicated in the notes thereto or, in the case of interimconsolidated financial statements, where information and footnotes contained insuch financial statements are not required to be in compliance with GAAP, andnormal year-end audit adjustments). Such financial statements included in the CompanySEC Filings were, at that time they were filed, consistent with the books andrecords of the Company in all material respects and complied as to form in allmaterial respects with then applicable accounting requirements and with the rules andregulations of the SEC with respect thereto. The Company keeps accounting records in accordance with GAAP, and normalyear end audit adjustments in which all material assets and liabilities, andall material transactions, including off-balance sheet transactions, of theCompany are recorded in material conformity with applicable accountingprinciples.

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## 3.7           MaterialChanges.  Since June 30, 2005,except as specifically contemplated by, or as otherwise disclosed in theCompany SEC Filings, each of the Company and its Subsidiaries has conducted itsbusiness in, and has not engaged in any material transaction other thanaccording to, the usual and ordinary course consistent with past practice and,since such date, there has not been any Material Adverse Effect with respect tothe Company.

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## 3.8           Litigation.  There is no action, suit, proceeding orinvestigation pending (each a “Proceeding” and collectively, the “Proceedings”),or to Company’s knowledge, threatened Proceedings against or affecting theCompany or any of its Subsidiaries, their respective assets or businesses, theoutcome of which is expected to have, individually or in the aggregate, aMaterial Adverse Effect with respect to the Company.  There are no pending, or to the Company’s knowledge,threatened Proceedings against the Company or any if its Subsidiaries that, asof the date hereof, challenges the validity or propriety, or seeks to preventthe consummation of the transactions contemplated hereby.

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## 3.9           Rights of Registration,Voting Rights, and Anti-Dilution. Except as contemplated in this Agreement, the Registration RightsAgreement, Section 3.9 of the Schedule of Exceptions and forregistration rights for which the Company has filed one or more registrationstatements that are currently effective**,**the Companyhas not granted or agreed to grant any registration rights, including piggybackrights, to any person and, to the Company’s knowledge, no stockholder of theCompany has entered into any agreements with respect to the voting of capitalshares of the Company.  The issuance ofthe Shares does not constitute an anti-dilution event for any existing securityholders of the Company, pursuant to which such security holders would be entitledto additional securities or a reduction in the applicable conversion price orexercise price of any securities.

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## 3.10         IntellectualProperty Rights.  The Company owns orpossesses the licenses or rights to use all patents, patent applications, patentrights, inventions, know-how, trade secrets, trademarks, trademarkapplications, service marks, service names, trade names and copyrightsnecessary to enable it to conduct its business as now operated (the “IntellectualProperty”).  There are no materialoutstanding options, licenses or agreements relating to the IntellectualProperty, nor is the Company bound by or a party to any material options,licenses or agreements relating to the patents, patent applications, patentrights, inventions, know-how, trade secrets, trademarks, trademarkapplications, service marks, service names, trade names or copyrights of anyother person or entity.  There is no 

 

 

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## claim or action or proceeding pending or, to the Company’sknowledge, threatened that challenges the right of the Company with respect toany Intellectual Property.  To theknowledge of the Company, the Company’s Intellectual Property does not infringeany intellectual property rights of any other person which, if the subject ofan unfavorable decision, ruling or finding would have a Material AdverseEffect.

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## 3.11         TaxStatus.  The Company has timely madeor filed all federal, state and foreign income and all other tax returns,reports and declarations required by any jurisdiction to which it is subject(unless and only to the extent that the Company has set aside on its booksprovisions reasonably adequate for the payment of all unpaid and unreportedtaxes) and has timely paid all taxes and other governmental assessments andcharges, shown or determined to be due on such returns, reports anddeclarations, except those being contested in good faith, and has set aside onits books provisions reasonably adequate for the payment of all taxes forperiods subsequent to the periods to which such returns, reports ordeclarations apply.  To the knowledge ofthe Company, there are no unpaid taxes claimed to be due by the taxingauthority of any jurisdiction, and the officers of the Company know of no basisfor any such claim.  The Company has notexecuted a waiver with respect to the statute of limitations relating to theassessment or collection of any foreign, federal, state or local tax.  None of the Company’s tax returns ispresently being audited by any taxing authority.

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## 3.12         EnvironmentalLaws.  The Company (i) is incompliance with all applicable foreign federal, state and local laws andregulations relating to the protection of human health and safety, theenvironment or hazardous or toxic substances or wastes, pollutants orcontaminants (“Environmental Laws”), (ii) has received all permits,licenses or other approvals required of them under applicable EnvironmentalLaws to conduct its business and (iii) is in compliance with all terms andconditions of any such permit, license or approval where, in each of the threeforegoing clauses, the failure to so comply would have, individually or in theaggregate, a Material Adverse Effect.

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## 3.13         NoBrokers.  The Company has taken noaction which would give rise to any claim by any person for brokeragecommissions, finder’s fees or similar payments relating to this Agreement orthe transactions contemplated hereby, except for dealings with Network 1Financial Services, Inc., whose commissions and fees will be paid for bythe Company.

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## 3.14         Insurance.  The Company is insured by insurers ofrecognized financial responsibility against such losses and risks and in suchamounts as management of the Company reasonably believes to be prudent andcustomary in the businesses in which the Company is engaged.

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## 3.15         EmploymentMatters.  The Company is incompliance with all federal, state, local and foreign laws and regulationsrespecting employment and employment practices, terms and conditions ofemployment and wages and hours, except where failure to be in compliance wouldnot have a Material Adverse Effect.  TheCompany is not bound by or subject to (and none of its assets or properties isbound by or subject to) any written or oral, express or implied, contract,commitment or arrangement with any labor union, and no labor union hasrequested or, to the Company’s knowledge, has sought to represent any of theemployees, representatives or agents of the Company.  There is no strike or other labor disputeinvolving the Company pending, or to the Company’s knowledge, threatened nor isthe Company aware of any labor organization activity involving itsemployees.  The Company is not aware thatany officer or key employee, or that any group of officers or key employees,intends to terminate their employment with the Company, nor does the Companyhave a present intention to terminate the employment of any of the foregoing.

 

 

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## 3.16         EmployeeBenefit Plans.  Except as set forthin the Company SEC Filings, there are no employee, profit sharing, stockoption, stock purchase, pension, retirement, bonus, severance or deferredcompensation plans or arrangements or any other welfare or benefit plans or anyunfunded liabilities in respect of any such plans or arrangements of theCompany, as well as all employment agreements, whether written or oral, withany person, and any contracts with any labor unions.

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## 3.17         InvestmentCompany Status.  The Company is notand upon consummation of the sale of the Securities will not be an “investmentcompany,” a company controlled by an “investment company” or an “affiliatedperson” of, or “promoter” or “principal underwriter” for, an “investmentcompany” as such terms are defined in the Investment Company Act of 1940, asamended.

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## 3.18         Subsidiaries.  Except as set forth in the Company SECFilings, the Company does not presently own or control, directly or indirectly,any interest in any other corporation, association, joint venture, partnershipor other business entity and the Company is not a direct or indirectparticipant in any joint venture or partnership.  Except for Dyntek Services, Inc., theCompany has no “significant subsidiary,” as that term is defined in Rule 1-02(w)of Regulation S-X under the Securities Act (“Significant Subsidiary”).

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## 3.19         NoConflict of Interest.  Except as setforth in the Company SEC Filings: (i) the Company is not indebted,directly or indirectly, to any of its officers or directors or to theirrespective spouses or children, in any amount whatsoever other than inconnection with expenses or advances of expenses incurred in the ordinarycourse of business or relocation expenses of employees, and (ii) none ofthe Company’s officers, directors or employees, or any members of theirimmediate families, are directly, or indirectly, indebted to the Company or, tothe best of the Company’s knowledge, have any direct or indirect ownershipinterest in any entity with which the Company is affiliated or with which theCompany has a business relationship, or any entity which competes with theCompany, except that officers, directors, employees and/or stockholders of theCompany may own stock in (but not exceeding five percent (5%) of theoutstanding capital stock of) any publicly traded company that may compete withthe Company.  To the best of the Company’sknowledge, none of the Company’s officers, directors or employees or anymembers of their immediate families are, directly or indirectly, interested inany material contract with the Company. The Company is not a guarantor or indemnitor of any indebtedness of anyother person or entity.

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## 3.20         NoManipulation of Stock.  The Companyhas not taken and will not, in violation of applicable law, take, any actiondesigned to or that might reasonably be expected to cause or result instabilization or manipulation of the price of the Common Stock to facilitatethe sale or resale of the Common Shares.

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## 3.21         RepresentationsComplete.  No representation orwarranty made by the Company in this Agreement contains any untrue statement ofa material fact or omits to state a material fact that is necessary to make therepresentation or warranty made, in the light of the circumstances under whichit was made, not false or misleading in any material respect.

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# **ARTICLE IVCOVENANTS**

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## 4.1           BestEfforts.  Each party will use itsbest efforts to satisfy in a timely fashion each of the conditions to besatisfied by it under Articles VI and VII of this Agreement.

 

 

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## 4.2           Form D;Blue Sky Laws.  The Company willtimely file a Notice of Sale of Securities on Form D with respect to theSecurities, as required under Regulation D. The Company will take such action as it reasonably determines to benecessary to qualify the Securities for sale to the Investors under thisAgreement under applicable securities (or “blue sky”) laws of the states of theUnited States (or to obtain an exemption from such qualification).

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## 4.3           TimelySEC Filings.  Throughout theRegistration Period (as defined in the Registration Rights Agreement), theCompany will timely file all reports, schedules, forms, statements and otherdocuments required to be filed by it with the SEC under the reportingrequirements of the Exchange Act, and the Company will not terminate its statusas an issuer required to file reports under the Exchange Act even if theExchange Act or the rules and regulations thereunder would permit suchtermination.

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## 4.4           Expenses.  The Company is liable for, and will pay, expensesincurred by it and one special counsel to the Investors in connection with thenegotiation, preparation, execution and delivery of this Agreement and theother agreements to be executed in connection herewith, including, withoutlimitation, attorneys’ and consultants’ fees and expenses; provided, however,that the Company is only obligated to pay expenses incurred by special counselto the Investors upon receipt of a reasonably itemized invoice setting forththe services performed by such special counsel in connection with the transactionscontemplated hereby.

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## 4.5           FinancialInformation.  As long as an Investorowns any of the Securities or Warrant Shares, the financial statements of theCompany will be prepared in accordance with United States generally acceptedaccounting principles consistently applied throughout the periods indicated(except as may be indicated in the notes thereto or, in the case of interimconsolidated financial statements, where information and footnotes contained insuch financial statements are not required to be in compliance with GAAP), andwill fairly present in all material respects the consolidated financialposition of the Company and results of its operations and cash flows as of, andfor the periods covered by, such financial statements.

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## 4.6           Notificationof Certain Matters.  Prior to theClosing, each party hereto shall give prompt notice to the other party of theoccurrence, or non-occurrence, of any event which would be likely to cause anyrepresentation and warranty herein to be untrue or inaccurate, or any covenant,condition or agreement herein not to be complied with or satisfied.

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## 4.7           Compliancewith Law.  As long as an Investorowns any of the Securities or Warrant Shares, the Company will conduct itsbusiness in compliance with all applicable laws, rules and regulations ofthe jurisdictions in which it is conducting business, including, withoutlimitation, all applicable local, state and federal environmental laws andregulations, the failure to comply, individually or in the aggregate, with whichwould have a Material Adverse Effect.

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## 4.8           Salesby Investors.  Each Investor willsell any Securities sold by it in compliance with applicable prospectusdelivery requirements, if any, or otherwise in compliance with the requirementsfor an exemption from registration under the Securities Act and the rules andregulations promulgated thereunder.  NoInvestor will make any sale, transfer or other disposition of the Securities inviolation of federal or state securities laws.

 

 

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# **ARTICLE VTRANSFER AGENT INSTRUCTIONS; REMOVAL OF LEGENDS**

# ** **

## 5.1           Issuanceof Certificates.  The Company will,or will instruct its transfer agent to, issue certificates, registered in thename of each Investor or its nominee, for the Securities and, promptly uponexercise of any Warrants, the applicable Warrant Shares.  All such certificates will bear therestrictive legend described in Section 2.7, except as otherwise specifiedin this Article V.  The Company willnot give to its transfer agent any instruction other than as described in this Article Vand stop transfer instructions to give effect to Section 2.7 hereof (priorto registration of the Securities under the Securities Act).  Nothing in this Section will affect inany way each Investor’s obligations to comply with all applicable prospectusdelivery requirements, if any, upon resale of the Common Shares and/or WarrantShares.

##  

## 5.2           UnrestrictedSecurities.  If, unless otherwiserequired by applicable state securities laws, (a) the Securities orWarrant Shares represented by a certificate have been registered under aneffective registration statement filed under the Securities Act, (b) aholder of Securities or Warrant Shares provides the Company and its transferagent with an opinion of counsel, in form, substance and scope customary foropinions of counsel in comparable transactions, to the effect that a publicsale or transfer of such Securities or Warrant Shares may be made withoutregistration under the Securities Act and such sale either has occurred or mayoccur without restriction on the manner of such sale or transfer, (c) suchholder provides the Company and its transfer agent with reasonable assurancesthat such Securities or Warrant Shares can be sold under Rule 144, or (d) theSecurities or Warrant Shares represented by a certificate can be sold withoutrestriction as to the number of securities sold under Rule 144(k), theCompany will permit the transfer of the Securities or Warrant Shares, and theCompany’s transfer agent will issue one or more certificates, free from anyrestrictive legend, in such name and in such denominations as specified by suchholder.  Notwithstanding anything hereinto the contrary and subject to applicable securities laws, the Securities orWarrant Shares may be pledged as collateral in connection with a bona fidemargin account or other lending arrangement; provided that such pledge will notalter the provisions of this Article V with respect to the removal ofrestrictive legends.

##  

# **ARTICLE VICONDITIONS TO THE COMPANY’S OBLIGATION TO SELL**

# ** **

The obligation of the Company to issue and sell theSecurities to each Investor at the Closing is subject to the satisfaction bysuch Investor, on or before the First Closing Date or the Second Closing Date,as the case may be, of each of the following conditions.  These conditions are for the Company’s solebenefit and may be waived by the Company at any time in its sole discretion:

 

## 6.1           Executionof Documents.  The Investor will haveexecuted this Agreement, the Investor Questionnaire, the Registration RightsAgreement and the Investor’s Warrant and will have delivered those agreementsto the Company.

##  

## 6.2           PurchasePrice.  The Investor will havedelivered the purchase price for the Securities to the Company in accordancewith this Agreement.

##  

## 6.3           Representationsand Warranties.  The representationsand warranties of the Investor must be true and correct in all materialrespects as of the First Closing Date and the Second Closing 

 

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Date, as applicable, as though made at that time (except forrepresentations and warranties that speak as of a specific date, whichrepresentations and warranties must be correct as of such date), and theInvestor will have performed and complied in all material respects with thecovenants and conditions required by this Agreement to be performed or compliedwith by the Investor at or prior to the Closing.

##  

## 6.4           NoProhibition.  No statute, rule,regulation, executive order, decree, ruling or injunction will have beenenacted, entered, promulgated or endorsed by or in any court or governmentalauthority of competent jurisdiction or any self-regulatory organization havingauthority over the matters contemplated hereby which prohibits the consummationof any of the transactions contemplated by this Agreement or the RegistrationRights Agreement or the Warrants.

##  

# **ARTICLE VIICONDITIONS TO THE INVESTOR’S OBLIGATION TO PURCHASE**

# ** **

The obligation of each Investor hereunder to purchasethe Securities from the Company at the Closing is subject to the satisfaction,on or before the First Closing Date or the Second Closing Date, as the case maybe, of each of the following conditions. These conditions are for each Investor’s respective benefit and may bewaived by any Investor at any time in its sole discretion:

 

## 7.1           Executionof Documents.  The Company will haveexecuted this Agreement, the Registration Rights Agreement and the Warrants andwill have delivered those Agreements to the Investor.

##  

## 7.2           Representationsand Warranties.  Each of therepresentations and warranties of the Company qualified by materiality must betrue and correct in all respects as of the Closing as though made at that time(except for representations and warranties that speak as of a specific date,which representations and warranties must be true and correct as of such date)and each of the representations and warranties of the Company not qualified bymateriality must be true and correct in all material respects as of the Closingas though made at that time (except for representations and warranties thatspeak as of a specific date, which representations and warranties must be trueand correct as of such date) and the Company must have performed and compliedin all material respects with the covenants and conditions required by thisAgreement to be performed or complied with by the Company at or prior to theClosing.  The Investor must have receiveda certificate or certificates dated as of the First Closing Date or the Second ClosingDate, as applicable, and executed by the Chief Executive Officer or the ChiefFinancial Officer of the Company certifying as to the matters in contained inthis Section 7.2 and as to such other matters as may be reasonablyrequested by such Investor, including, but not limited to, the Company Certificate,Bylaws, Board of Directors’ resolutions relating to the transactionscontemplated hereby and the incumbency and signatures of each of the officersof the Company who may execute on behalf of the Company any document deliveredat the Closing.

##  

## 7.3           NoProhibitions.  No litigation,statute, rule, regulation, executive order, decree, ruling or injunction willhave been enacted, entered, promulgated or endorsed by or in any court orgovernmental authority of competent jurisdiction or any self-regulatoryorganization having authority over the matters contemplated hereby whichprohibits the consummation of any of the transactions contemplated by thisAgreement or the Registration Rights Agreement or the Warrants and which could,individually or in the aggregate, have a Material Adverse Effect.

 

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## 7.4           IrrevocableInstructions.  Irrevocable transferagent instructions, in form and substance satisfactory to the Investors, willhave been delivered to the Company’s transfer agent instructing the transferagent to deliver certificates representing the Common Shares within five (5) businessdays following the First Closing Date or the Second Closing Date, as the casemay be.

##  

## 7.5           WarrantCertificates.  The Company shall havedelivered to the Investors certificates representing the Warrants purchased bythe Investors pursuant to this Agreement.

##  

# **ARTICLE VIIIINDEMNIFICATION**

# ** **

In consideration of each Investor’s execution anddelivery of this Agreement and its acquisition of the Securities hereunder, andin addition to all of the Company’s other obligations under this Agreement, theRegistration Rights Agreement and the Warrants, the Company will defend,protect, indemnify and hold harmless each Investor and each other holder of theSecurities and all of their stockholders, officers, directors, employees anddirect or indirect investors and any of the foregoing person’s agents or otherrepresentatives (including, without limitation, those retained in connectionwith the transactions contemplated by this Agreement) (collectively, the “Indemnitees”)from and against any and all actions, causes of action, suits, claims, losses,costs, penalties, fees, liabilities and damages, and expenses in connectiontherewith (regardless of whether any such Indemnitee is a party to the actionfor which indemnification hereunder is sought), and including reasonableattorneys’ fees and disbursements (the “Indemnified Liabilities”), incurred byan Indemnitee as a result of, or arising out of, or relating to (a) anybreach of any representation or warranty made by the Company herein or in anyother certificate, instrument or document contemplated hereby or thereby, (b) anybreach of any covenant, agreement or obligation of the Company contained hereinor in any other certificate, instrument or document contemplated hereby orthereby or (c) any cause of action, suit or claim brought or made againstsuch Indemnitee and arising out of or resulting from the execution, delivery,performance, breach or enforcement of this Agreement or the Registration RightsAgreement or Warrants by the Company.  Tothe extent that the foregoing undertaking by the Company is unenforceable forany reason, the Company will make the maximum contribution to the payment andsatisfaction of each of the Indemnified Liabilities that is permissible underapplicable law.

 

The Indemnitees shall have the right to employseparate counsel in any such proceeding and to participate in the defensethereof, but the fees and expenses of such counsel shall be at the expense ofsuch Indemnitees unless: (i) the Company has agreed in writing to pay suchfees and expenses; (ii) the Company shall have failed to promptly assumethe defense of such proceeding and to employ counsel reasonably satisfactory tosuch Indemnitees in any such proceeding; or (iii) the named parties to anysuch proceeding (including any impleaded parties) include both such Indemniteesand the Company, and such Indemnitees shall have been advised by counsel that aconflict of interest is likely to exist if the same counsel were to representsuch Indemnitees and the Company (in which case, if such Indemnitees notify theCompany in writing that they elect to employ separate counsel at the expense ofthe Company, the Company shall not have the right to assume the defense thereofand such counsel shall be at the reasonable expense of the Company; provided,however, that in no event shall the Company be responsible for the fees and expensesof more than one separate counsel).  TheCompany shall not be liable for any settlement of any such proceeding effectedwithout its written consent, which consent shall not be unreasonably withheld.  The Company shall not, without the priorwritten consent of a majority of the Indemnitees, effect any settlement of anypending 

 

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proceedingin respect of which Indemnitees are a party, unless such settlement includes anunconditional release of such Indemnitees from all liabilities that are thesubject matter of such proceeding. Subject to the foregoing, all fees and expenses (including reasonablefees and expenses to the extent incurred in connection with investigating orpreparing to defend any such proceeding in a manner inconsistent with this Article VIII)of the Indemnitees shall be paid to the Indemnitees as incurred, within ten (10) businessdays of written notice thereof to the Company, which notice shall be deliveredno more frequently than on a monthly basis; provided, that the Indemniteesshall reimburse the Company for any and all such fees and expenses to theextent it is finally judicially determined that such Indemnitees are notentitled to indemnification hereunder.

 

# **ARTICLE IXDEFINITIONS**

# ** **

## 9.1           “Bylaws”has the meaning set forth in Section 3.5.

##  

## 9.2           “Closing”means the closing of the purchase and sale of the Securities under thisAgreement on the First Closing Date or the Second Closing Date.

##  

## 9.3           “CommonShares” has the meaning set forth in the Recitals.

##  

## 9.4           “CommonStock” means the common stock, par value $.0001 per share, of the Company.

##  

## 9.5           “Company”means DynTek, Inc.

##  

## 9.6           “CompanyCertificate” has the meaning set forth in Section 3.5.

##  

## 9.7           “CompanySEC Filings” has the meaning set forth in Section 3.6.

##  

## 9.8           “EnvironmentalLaws” has the meaning set forth in Section 3.11.

##  

## 9.9           “ExchangeAct” means the Securities Exchange Act of 1934, as amended.

##  

## 9.10         “FirstClosing Date” has the meaning set forth in Section 1.3.

##  

## 9.11         “IndemnifiedLiabilities” has the meaning set forth in Article VIII.

##  

## 9.12         “Indemnitees”has the meaning set forth in Article VIII.

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## 9.13         “IntellectualProperty” has the meaning set forth in Section 3.9.

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## 9.14         “Investors”means the investors whose names are set forth on the signature pages ofthis Agreement, and their permitted transferees.

##  

## 9.15         “Lien”means any mortgage, pledge, security interest, encumbrance, lien or charge ofany kind (including any conditional sale or other title retention agreement,any lease in the nature thereof, and the filing of or agreement to give anyfinancing statement under the Uniform Commercial Code or comparable law of anyjurisdiction in connection with such mortgage, pledge, security interest,encumbrance, lien or charge).

 

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## 9.16         “MaterialAdverse Effect” means a material adverse effect on (a) the business,operations, assets, liabilities, rights, obligations or financial condition ofthe Company and its Subsidiaries, taken as a whole, or (b) the ability ofthe Company to perform its obligations pursuant to the transactionscontemplated by this Agreement or under the agreements or instruments to beentered into or filed in connection herewith, including the Registration RightsAgreement and the Warrants.

##  

## 9.17         “PreferredStock” has the meaning set forth in Section 3.3.

##  

## 9.18         “RegistrationRights Agreement” means the Registration Rights Agreement, dated as of the dateof this Agreement and among the parties to this Agreement, in the form attachedhereto as Exhibit C.

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## 9.19         “RegulationD” means Regulation D as promulgated by the SEC under the Securities Act.

##  

## 9.20         “Rule 144”and “Rule 144(k)” mean Rule 144 and Rule 144(k), respectively,promulgated under the Securities Act, or any successor rule.

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## 9.21         “SEC”means the United States Securities and Exchange Commission.

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## 9.22         “SecondClosing Date” has the meaning set forth in Section 1.3.

##  

## 9.23         “Securities”has the meaning set forth in the Recitals.

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## 9.24         “SecuritiesAct” means the Securities Act of 1933, as amended, and the rules andregulations thereunder, or any similar successor statute.

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## 9.25         “SignificantSubsidiary” has the meaning set forth in Section 3.18.

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## 9.26         “Subsidiary”means a Corporation or other business entity in which the Company controls,either directly or indirectly, at least 50% of the voting power and which meetsthe test of a significant subsidiary as defined in Rule 1-02(w) ofRegulation S-X promulgated under the Exchange Act.

##  

## 9.27         “Warrants”has the meaning set forth in the Recitals.

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## 9.28         “WarrantShares” means the number of shares of Common Stock purchaseable by theWarrants.

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# **ARTICLE XGOVERNING LAW; MISCELLANEOUS**

# ** **

## 10.1         GoverningLaw; Jurisdiction; Jury Trial Waiver. This Agreement will be governed by and interpreted in accordance withthe laws of the State of California without regard to the principles ofconflict of laws.  The parties heretohereby submit to the exclusive jurisdiction of the United States federal andstate courts located in the County of Orange, State of California with respectto any dispute arising under this Agreement, the agreements entered into inconnection herewith or the transactions contemplated hereby or thereby. EACHPARTY HEREBY 

 

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## IRREVOCABLY WAIVES ANY RIGHT THAT IT MAY HAVE TO,AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTEHEREUNDER OR IN CONNECTION HEREWITH OR WITH ANY TRANSACTION CONTEMPLATEDHEREBY.

##  

## 10.2         Counterparts;Signatures by Facsimile.  This Agreementmay be executed in two or more counterparts, all of which are considered oneand the same agreement and will become effective when counterparts have beensigned by each party and delivered to the other parties.  This Agreement, once executed by a party, maybe delivered to the other parties hereto by facsimile transmission of a copy ofthis Agreement bearing the signature of the party so delivering this Agreement.

##  

## 10.3         Headings.  The headings of this Agreement are forconvenience of reference only, are not part of this Agreement and do not affectits interpretation.

##  

## 10.4         Severability.  If any provision of this Agreement is invalidor unenforceable under any applicable statute or rule of law, then suchprovision will be deemed modified in order to conform with such statute or rule oflaw.  Any provision hereof that may proveinvalid or unenforceable under any law will not affect the validity orenforceability of any other provision hereof.

##  

## 10.5         EntireAgreement; Amendments.  ThisAgreement, the Registration Rights Agreement (including all schedules andexhibits thereto) and the Warrants constitute the entire agreement among theparties hereto with respect to the subject matter hereof and thereof.  There are no restrictions, promises,warranties or undertakings, other than those set forth or referred to herein ortherein.  This Agreement supersedes allprior agreements and understandings among the parties hereto with respect tothe subject matter hereof.  No provisionof this Agreement may be waived or amended other than by an instrument inwriting signed by the party to be charged with enforcement.

##  

## 10.6         Notices.  Any notices required or permitted to be givenunder the terms of this Agreement must be sent by certified or registered mail(return receipt requested) or delivered personally or by courier (including arecognized overnight delivery service) or by facsimile and will be effectivefive days after being placed in the mail, if mailed by regular U.S. mail, orupon receipt, if delivered personally, by courier (including a recognizedovernight delivery service) or by facsimile, in each case addressed to aparty.  The addresses for suchcommunications are:

##  

| If to the  Company: | Chief Financial  Officer                  |
|---------------------|-------------------------------------------|
|                | DynTek, Inc.                         |
|                | 19700 Fairchild Road, Suite 230      |
|                | Irvine, California 92612                  |
|                | Fax: (949) 955-0086                       |
|                |                                      |
| With copies to:     | Christopher Ivey, Esq.               |
|                | Stradling Yocca Carlson & Rauth  |
|                | 660 Newport Center Drive, Suite 1600 |
|                | Newport Beach, California 92660           |
|                | Fax: (949) 725-4100                       |

 

If to an Investor: To the address set forth immediately below such Investor’s name on thesignature pages hereto.

 

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| With a copy to: | Damon Testaverde                          |
|-----------------|-------------------------------------------|
|            | Network 1 Financial Securities, Inc. |
|            | The Galleria, Penthouse                   |
|            | 2 Bridge Avenue, Building 2               |
|            | Red Bank, New Jersey 07707                |

 

Each party will provide written notice to the otherparties of any change in its address in accordance with the notice provisionshereof.

 

## 10.7         Successorsand Assigns.  This Agreement isbinding upon and inures to the benefit of the parties and their successors andassigns.  The Company will not assignthis Agreement or any rights or obligations hereunder without the prior writtenconsent of the Investors, and no Investor may assign this Agreement or anyrights or obligations hereunder without the prior written consent of theCompany.  Notwithstanding the foregoing,an Investor may assign all or part of its rights and obligations hereunder toany of its “affiliates,” as that term is defined under the Securities Act,without the consent of the Company so long as the affiliate is an accreditedinvestor (within the meaning of Regulation D under the Securities Act) andagrees in writing to be bound by this Agreement.  This provision does not limit the Investor’sright to transfer the Securities pursuant to the terms of this Agreement or toassign the Investor’s rights hereunder to any such transferee pursuant to theterms of this Agreement.

##  

## 10.8         ThirdParty Beneficiaries.  This Agreementis intended for the benefit of the parties hereto and their respectivepermitted successors and assigns, and is not for the benefit of, nor may anyprovision hereof be enforced by, any other person.

##  

## 10.9         NoOther Representations.  The Companymakes no representations or warranties in any oral or written informationprovided to Investors, other than the representations and warranties includedherein.

##  

## 10.10       FurtherAssurances.  Each party will do andperform, or cause to be done and performed, all such further acts and things,and will execute and deliver all other agreements, certificates, instrumentsand documents, as another party may reasonably request in order to carry outthe intent and accomplish the purposes of this Agreement and the consummationof the transactions contemplated hereby.

##  

## 10.11       NoStrict Construction.  The languageused in this Agreement is deemed to be the language chosen by the parties toexpress their mutual intent, and no rules of strict construction will beapplied against any party.

##  

## 10.12       EquitableRelief.  The Company recognizes that,if it fails to perform or discharge any of its obligations under thisAgreement, any remedy at law may prove to be inadequate relief to theInvestors.  The Company therefore agreesthat the Investors are entitled to seek temporary and permanent injunctiverelief in any such case.

##  

[SIGNATURE PAGE FOLLOWS]

 

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[SIGNATURE PAGE TO SECURITIES PURCHASE AGREEMENT]

 

IN WITNESS WHEREOF, the undersigned Investors and theCompany have caused this Securities Purchase Agreement to be duly executed asof the date first above written.

 

 
|   | COMPANY:     |
|--------|--------------|
|   |         |
|   | DYNTEK, INC. |
|   |         |
|   |         |
|   | By:          | /s/ Casper Zublin, Jr. |
|   | Name:        | Casper Zublin, Jr. |
|   | Title:       | Chief Executive Officer |
|        |              |  |  |  |

 

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**OMNIBUS SIGNATURE PAGE TO**

**DYNTEK, INC.**

**SECURITIES PURCHASE AGREEMENT**

 

The undersigned hereby executes and delivers theSecurities Purchase Agreement to which this Signature Page is attached,which, together with all counterparts of the Agreement and Signature Pages ofthe other parties named in said Agreement, shall constitute one and the samedocument in accordance with the terms of the Agreement.

 

 
| Date:  |                                 |   |   |
|--------|--------------------------------------|--------|--------|
|   |                                 |
|   | Investor Name:                       |   |
|   |                                 |   |
|   | Sign Name:                           |   |
|   |                                 |   |
|   | Print Name:                          |   |
|   |                                 |   |
|   | Title:                               |   |
|   |                                 |   |
|   | Address                              |   |
|   |                                 |
|   |                                 |
|   |                                 |
|   |                                 |
|   |                                 |
|   | Telephone:                           |   |
|   |                                 |   |
|   | Facsimile:                           |   |
|   |                                 |   |
|   | Number of Securities Purchased:      |
|   |                                 |
|   | Common Shares:                       |   |
|   |                                 |   |
|   | Warrants (Number of Warrant Shares): |   |
|        |                                      |        |        |  |  |  |  |  |  |  |  |  |

 

If the name in which theShare Certificates and Warrants are to be issued or the registered address ofthe holder thereof is different than the name and address above, please provideinstructions below:

 
|   | Name:               |   |
|--------|---------------------|--------|
|   |                |   |
|   |                |
|   | Registered Address: |   |
|   |                |   |
|   |                |
|   |                |
|   |                |
|        |                     |        |  |

 

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