EX-10.4






SECURITIES PURCHASE AGREEMENT




This SECURITIES PURCHASE AGREEMENT (the “Agreement”), dated as of April      , 2006, is made by
and among Wave Wireless Corporation, a corporation organized under the laws of the State of
Delaware (the “Company”), each of the purchasers (individually, a “Purchaser” and collectively the
“Purchasers”) set forth on the execution pages hereof (each, an “Execution Page” and collectively
the “Execution Pages”), and, solely with respect to Section 8 hereof, Kramer Levin Naftalis &
Frankel LLP, a New York limited liability partnership (“Escrow Agent”) with its principal place of
business in New York, NY.



BACKGROUND




A. The Company and each Purchaser are executing and delivering this Agreement in reliance upon
the exemption from securities registration afforded by the provisions of Regulation D (“Regulation
D”), as promulgated by the United States Securities and Exchange Commission (the “SEC”) under the
Securities Act of 1933, as amended (the “Securities Act”).



B. Upon the terms and conditions stated in this Agreement, the Company desires to issue and
sell to the Purchasers, and the Purchasers desire to purchase, (i) the number of shares of the
Company’s Series J-1 Convertible Preferred Stock, par value $0.0001 per share, (the “Preferred
Stock”) set forth on each Purchaser’s Execution Page, in an aggregate amount of Three Hundred (300)
shares of Preferred Stock, which Preferred Stock shall have the rights, preferences and privileges
set forth in the form of Certificate of Designation of the Relative Rights and Preferences of the
Preferred Stock attached hereto as Exhibit A (the “Certificate of Designation”) and shall
initially be convertible into 30,000,000 shares of the Company’s common stock, par value $0.0001
per share (the “Common Stock”), per share of Preferred Stock; and (ii) warrants, in the form
attached hereto as Exhibit B (the “Warrants”), to acquire the number of shares of Common
Stock set forth on each Purchaser’s Execution Page, in an aggregate amount of Nine Million
(9,000,000) shares of Common Stock. The shares of Common Stock issuable upon conversion of or
otherwise pursuant to the Preferred Stock are referred to herein as the “Conversion Shares” and the
shares of Common Stock issuable upon exercise of or otherwise pursuant to the Warrants are referred
to herein as the “Warrant Shares.” The Preferred Stock, the Warrants, the Conversion Shares and the
Warrant Shares are collectively referenced herein as the “Securities” and each of them may
individually be referred to herein as a “Security.”



C. In connection with the Closing pursuant to this Agreement, the parties hereto will execute
and deliver a Registration Rights Agreement, in the form attached hereto as Exhibit C (the
“Registration Rights Agreement ”), pursuant to which the Company has agreed to provide certain
registration rights under the Securities Act and the rules and regulations promulgated thereunder,
and applicable state securities laws. This Agreement, the Certificate of Designation, the Warrants
and the Registration Rights Agreement are collectively referred to herein as the “Transaction
Documents.”



NOW, THEREFORE, in consideration of the premises and mutual covenants contained herein and
other good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Company and the Purchasers hereby agree as follows:



1. PURCHASE AND SALE OF SECURITIES.



(a) Purchase and Sale of Securities. Subject to the terms and conditions hereof, at
the



Closing (as defined in Section 1(b) below), the Company shall issue and sell to each Purchaser, and
each Purchaser, severally and not jointly, shall purchase from the Company, such number of
Preferred Stock as is set forth on such Purchaser’s Execution Page, for a purchase price (as to
each Purchaser, the “Purchase Price”) per share equal to Seven Thousand Five Hundred Dollars
($7,500) (the “Per Share Purchase Price”).



(b) Closings. The Company shall be entitled to issue and sell such number of shares
of Preferred Stock to Purchasers at one or more closings (the “Closing”) consummated prior to the
filing of the Registration Statement pursuant to the Registration Rights Agreement, in each case
pursuant to terms of this Agreement and provided that each such Purchaser executes an Execution
Page hereto and to each of the other Transaction Documents to which the Purchasers are a party, and
thereby agrees to be bound by and subject to the terms and conditions hereof and thereof. Each
date on which a closing takes place under the terms of this Agreement shall be deemed to be a
“Closing Date.” All references herein to Preferred Stock shall include any shares issued of
Preferred Stock at any closing held pursuant to this Section 1(b).



2. PURCHASER’S REPRESENTATIONS AND WARRANTIES.



Each Purchaser severally, but not jointly, represents and warrants to the Company as follows:



(a) Purchase for Own Account, Etc. Such Purchaser is purchasing the Securities for
such Purchaser’s own account for investment purposes only and not with a present view towards the
public sale or distribution thereof, except pursuant to sales that are exempt from the registration
requirements of the Securities Act and/or sales registered under the Securities Act. The Purchaser
has substantial experience in evaluating and investing in private placement transactions of
securities in companies similar to the Company so that it is capable of evaluating the merits and
risks of its investment in the Company. Such Purchaser understands that such Purchaser must bear
the economic risk of this investment indefinitely unless the Securities are registered pursuant to
the Securities Act and any applicable state securities or blue sky laws or an exemption from such
registration is available, and that the Company has no present intention of registering the resale
of any such Securities other than as contemplated by the Registration Rights Agreement.
Notwithstanding anything in this Section 2(a) to the contrary, by making the representations
herein, such Purchaser does not agree to hold the Securities for any minimum or other specific term
and reserves the right to dispose of the Securities at any time in accordance with or pursuant to a
registration statement or an exemption from the registration requirements under the Securities Act.



(b) Accredited Investor Status. Such Purchaser is an “Accredited Investor” as that
term is defined in Rule 501(a) of Regulation D promulgated under the Securities Act.



(c) Reliance on Exemptions. Such Purchaser understands that the Securities are being
offered and sold to such Purchaser in reliance upon specific exemptions from the registration
requirements of United States federal and state securities laws and that the Company is relying
upon the truth and accuracy of, and such Purchaser’s compliance with, the representations,
warranties, agreements, acknowledgments and understandings of such Purchaser set forth herein in
order to determine the availability of such exemptions and the eligibility of such Purchaser to
acquire the Securities.



(d) Information. All materials relating to the business, finances and operations of
the Company (including the Company’s most recent Annual Report on Form 10-K and most recent
Quarterly Report on Form 10-Q), the Certificate of Incorporation of the Company as in effect on the
date hereof (the “Certificate of Incorporation”), the Bylaws of the Company as in effect on the
date hereof (the “Bylaws”) and materials relating to the offer and sale of the Securities which
have been specifically requested by such Purchaser or its counsel have been made available to such
Purchaser and its counsel, if any. Neither such inquiries nor any other investigation conducted by
such Purchaser or its counsel or any of its representatives shall modify, amend or affect such
Purchaser’s right to rely on the Company’s representations and warranties contained in Section 3
below. Such Purchaser understands that such Purchaser’s investment in the Securities involves a
high degree of risk, including the risk of loss of its entire investment in the Securities.



(e) Governmental Review. Such Purchaser understands that no United States federal or
state agency or any other government or governmental agency has passed upon or made any
recommendation or endorsement of the Securities.



(f) Transfer or Resale. Such Purchaser understands that (i) except as provided in the
Registration Rights Agreement, the sale or resale of the Securities have not been and are not being
registered under the Securities Act or any state securities laws, and the Securities may not be
transferred unless (A) the transfer is made pursuant to and as set forth in an effective
registration statement under the Securities Act covering the Securities; or (B) such Purchaser
shall have delivered to the Company an opinion of counsel (which opinion shall be in form,
substance and scope customary for opinions of counsel in comparable transactions) to the effect
that the Securities to be sold or transferred may be sold or transferred pursuant to an exemption
from such registration; or (C) sold under and in compliance with Rule 144 promulgated under the
Securities Act (including any successor rule, “Rule 144”); or (D) sold or transferred to an
affiliate of such Purchaser that agrees to sell or otherwise transfer the Securities only in
accordance with the provisions of this Section 2(f) and that is an Accredited Investor; and (ii)
neither the Company nor any other person is under any obligation to register such Securities under
the Securities Act or any state securities laws (other than pursuant to the terms of the
Registration Rights Agreement). Notwithstanding the foregoing or anything else contained herein to
the contrary, the Securities may be pledged as collateral in connection with a bona fide margin
account or other lending arrangement, provided such pledge is consistent with applicable laws,
rules and regulations.



(g) Legends. Such Purchaser understands that the Preferred Stock and Warrants and,
until such time as the Conversion Shares and Warrant Shares have been registered under the
Securities Act (including registration pursuant to Rule 416 thereunder) as contemplated by the
Registration Rights Agreement or otherwise may be sold by such Purchaser under Rule 144, the
certificates for the Conversion Shares and Warrant Shares may bear a restrictive legend in
substantially the following form:



The securities represented by this certificate have not been
registered under the Securities Act of 1933, as amended, or the
securities laws of any state of the United States or in any other
jurisdiction. The securities represented hereby may not be offered,
sold or transferred in the absence of an effective registration
statement for the securities under applicable securities laws unless
offered, sold or transferred pursuant to an available exemption from
the registration requirements of those laws.



The Company shall, within three (3) business days after any registration statement covering
the Securities (including, without limitation, the Registration Statement contemplated by the
Registration Rights Agreement) is declared effective, deliver to its transfer agent an opinion
letter of counsel, opining that at any time such registration statement is effective, the transfer
agent shall issue, in connection with the issuance of the Conversion Shares and Warrant Shares,
certificates representing such Conversion Shares and Warrant Shares without the restrictive legend
above, provided such Conversion Shares and Warrant Shares are to be sold pursuant to the prospectus
contained in such registration statement. Upon receipt of such opinion, the Company shall cause the
transfer agent to confirm, for the benefit of the holders, that no further opinion of counsel is
required at the time of transfer in order to issue such shares without such restrictive legend.



The legend set forth above shall be removed and the Company shall issue a certificate without
such legend to the holder of any Security upon which it is stamped, if, unless otherwise required
by state securities laws, (i) the sale of such Security is registered under the Securities Act
(including registration pursuant to Rule 416 thereunder); (ii) such holder provides the Company
with an opinion of counsel, in form, substance and scope customary for opinions of counsel in
comparable transactions, to the effect that a public sale or transfer of such Security may be made
without registration under the Securities Act; or (iii) such holder provides the Company with
reasonable assurances that such Security can be sold under Rule 144. In the event the above legend
is removed from any Security and thereafter the effectiveness of a registration statement covering
such Security is suspended or the Company determines that a supplement or amendment thereto is
required by applicable securities laws, then upon reasonable advance written notice to such
Purchaser the Company may require that the above legend be placed on any such Security that cannot
then be sold pursuant to an effective registration statement or under Rule 144 and such Purchaser
shall cooperate in the replacement of such legend. Such legend shall thereafter be removed when
such Security may again be sold pursuant to an effective registration statement or under Rule 144.



(h) Authorization; Enforcement. This Agreement and the Registration Rights Agreement
have been duly and validly authorized, executed and delivered on behalf of such Purchaser and are
valid and binding agreements of such Purchaser enforceable against such Purchaser in accordance
with their terms.



(i) Residency. Such Purchaser is a resident of the jurisdiction set forth under such
Purchaser’s name on the Execution Page hereto executed by such Purchaser.



(j) Independent Investment. Except as may be disclosed in any filings with the SEC by
the Purchasers, or any of them, under Section 13 and/or Section 16 of the Exchange Act, no
Purchaser has agreed to act with any other Purchaser for the purpose of acquiring, holding, voting
or disposing of the Shares purchased hereunder for purposes of Section 13(d) under the Exchange
Act, and each Purchaser is acting independently with respect to its investment in the Preferred
Stock and the Warrants.



Each Purchaser’s representations and warranties made in this Article 2 are made solely for the
purpose of permitting the Company to make a determination that the offer and sale of the Securities
pursuant to this Agreement comply with applicable U.S. federal and state securities laws and not
for any other purpose. Accordingly, the Company may not rely on such representations and warranties
for any other purpose.



3. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.



Except as set forth on a Disclosure Schedule executed and delivered by the Company to each
Purchaser (the “Disclosure Schedule”), the Company represents and warrants to each Purchaser as
follows, which representations and warranties shall be deemed to have been made on each Closing
Date with respect to the Purchasers acquiring Securities on such Closing Date:



(a) Organization and Qualification. The Company and each of its direct and indirect
subsidiaries (collectively, the “Subsidiaries”) is a corporation duly organized and existing in
good standing under the laws of the jurisdiction in which it is incorporated or organized, and has
the requisite corporate power to own, lease, operate its properties, assets and to carry on its
business as now being conducted. The Company and each of its Subsidiaries is duly qualified as a
foreign corporation to do business and is in good standing in every jurisdiction in which the
nature of the business conducted by it makes such qualification necessary and where the failure so
to qualify would have a Material Adverse Effect. The Company does not have any Subsidiaries except
as set forth on Section 3(a) of the Disclosure Schedule. For purposes of this Agreement,
“Material Adverse Effect” means any material adverse effect on (i) the Securities, (ii) the ability
of the Company to perform its obligations under this Agreement or the other Transaction Documents
or (iii) the business, operations, properties, prospects, financial condition or results of
operations of the Company and its Subsidiaries, taken as a whole. For the purposes of this
Agreement, “Subsidiary” shall mean any corporation or other entity of which at least a majority of
the securities or other ownership interest having ordinary voting power (absolutely or
contingently) for the election of directors or other persons performing similar functions are at
the time owned directly or indirectly by the Company and/or any of its other subsidiaries.



(b) Authorization; Enforcement. (i) The Company has the requisite corporate power and
authority to enter into and perform its obligations under this Agreement and the other Transaction
Documents, to issue and sell the Preferred Stock and Warrants in accordance with the terms hereof,
to issue the Conversion Shares upon conversion of the Preferred Stock in accordance with the terms
thereof and to issue the Warrant Shares upon exercise of the Warrants in accordance with the terms
thereof; (ii) the execution, delivery and performance of this Agreement and the other Transaction
Documents by the Company and the consummation by it of the transactions contemplated hereby and
thereby (including, without limitation, the issuance of the Preferred Stock and Warrants and the
issuance and reservation for issuance of the Conversion Shares and Warrant Shares) have been duly
authorized by the Company’s Board of Directors and no further consent or authorization of the
Company, its Board of Directors, any committee of the Board of Directors, or its stockholders is
required and (iii) this Agreement constitutes, and, upon execution and delivery by the Company of
the other Transaction Documents, such Transaction Documents will constitute, valid and binding
obligations of the Company enforceable against the Company in accordance with their terms. Neither
the execution, delivery or performance by the Company of its obligations under this Agreement or
the other Transaction Documents, nor the consummation by it of the transactions contemplated hereby
or thereby (including, without limitation, the issuance of the Preferred Stock and Warrants or the
issuance or reservation for issuance of the Conversion Shares or Warrant Shares) requires any
consent or authorization of the Company’s stockholders.



(c) Capitalization. The capitalization of the Company as of the date hereof, including
the authorized capital stock, the number of shares issued and outstanding, the number of shares
issuable and reserved for issuance pursuant to the Company’s stock option plans, the number of
shares issuable and reserved for issuance pursuant to securities (other than the Preferred Stock
and the Warrants) exercisable or exchangeable for, or convertible into, any shares of capital stock
and the number of shares to be reserved for issuance upon conversion of the Preferred Stock and
exercise of the Warrants is set forth in Section 3(c) of the Disclosure Schedule. All of
such outstanding shares of capital stock have been, or upon issuance in accordance with the terms
of any such exercisable, exchangeable or convertible securities will be, duly authorized, validly
issued, fully paid and non-assessable. No shares of capital stock of the Company (including the
Conversion Shares and the Warrant Shares) are subject to preemptive rights or any other similar
rights of the stockholders of the Company or any liens or encumbrances. Except for the Securities
and as set forth in Section 3(c) of the Disclosure Schedule, (i) there are no outstanding
options, warrants, scrip, rights to subscribe to, calls or commitments of any character whatsoever
relating to, or securities or rights convertible into or exercisable or exchangeable for, any
shares of capital stock of the Company or any of its Subsidiaries, or arrangements by which the
Company or any of its Subsidiaries is or may become bound to issue additional shares of capital
stock of the Company or any of its Subsidiaries, nor are any such issuances or arrangements
contemplated, (ii) there are no agreements or arrangements under which the Company or any of its
Subsidiaries is obligated to register the sale of any of its or their securities under the
Securities Act (except the Registration Rights Agreement); (iii) there are no outstanding
securities or instruments of the Company which contain any redemption or similar provisions, and
there are no contracts, commitments, understandings or arrangements by which the Company is or may
become bound to redeem any security of the Company; (iv) the Company is not a party to any
agreement restricting the voting or transfer of any shares of capital stock of the Company; and (v)
the Company does not have any shareholder rights plan, “poison pill” or other anti-takeover plans
or similar arrangements. Section 3(c) of the Disclosure Schedule sets forth all of the
securities or instruments issued by the Company or any of its Subsidiaries that contain
anti-dilution or similar provisions that will be triggered by, and all of the resulting adjustments
that will be made to such securities and instruments as a result of, the issuance of the Securities
in accordance with the terms of this Agreement, the Preferred Stock or the Warrants. The Company
has furnished or made available to the Purchasers, true and correct copies of the Company’s
Certificate of Incorporation as in effect on the date hereof, the Company’s Bylaws as in effect on
the date hereof, and all other instruments and agreements governing securities convertible into or
exercisable or exchangeable for capital stock of the Company. Except as set forth on Section
3(c) of the Disclosure Schedule, the offer and sale of all capital stock, convertible
securities, rights, warrants, or options of the Company issued since January 1, 2003 and prior to
the Closing complied with all applicable Federal and state securities laws, and no stockholder has
a right of rescission or claim for damages with respect thereto which would have a Material Adverse
Effect.



(d) Subsidiaries. Section 3(d) of the Disclosure Schedules sets forth each
subsidiary of the Company, showing the jurisdiction of its incorporation or organization and
showing the percentage of each person’s ownership. All of the outstanding shares of capital stock
of each Subsidiary have been duly authorized and validly issued, and are fully paid and
nonassessable. There are no outstanding preemptive, conversion or other rights, options, warrants
or agreements granted or issued by or binding upon any Subsidiary for the purchase or acquisition
of any shares of capital stock of any subsidiary or any other securities convertible into,
exchangeable for or evidencing the rights to subscribe for any shares of such capital stock.
Neither the Company nor any Subsidiary is subject to any obligation (contingent or otherwise) to
repurchase or otherwise acquire or retire any shares of the capital stock of any subsidiary or any
convertible securities, rights, warrants or options of the type described in the preceding
sentence. Neither the Company nor any Subsidiary is party to, nor has any knowledge of, any
agreement restricting the voting or transfer of any shares of the capital stock of any Subsidiary.
The Company or one of its Subsidiaries has the unrestricted right to vote, and (subject to
limitations imposed by applicable law) to receive dividends and distributions on, all capital
securities of its Subsidiaries as owned by the Company or any such Subsidiary.



(e) Issuance of Securities. The Preferred Stock and Warrants are duly authorized and,
upon issuance in accordance with the terms of this Agreement, (i) will be validly issued and free
from all taxes, liens, claims and encumbrances (other than restrictions on transfer contained in
this Agreement or the Certificate of Designation or Warrants), (ii) will not be subject to
preemptive rights, rights of first refusal or other similar rights of stockholders of the Company
or any other person and (iii) will not impose personal liability on the holder thereof. When the
Conversion Shares and Warrant Shares are issued in accordance with the terms of the Certificate of
Designation and Warrants, respectively, such shares will be (i) duly authorized by all necessary
corporate action(ii) will be validly issued and outstanding, fully paid and nonassessable, and free
from all taxes, liens, claims and encumbrances (other than restrictions on transfer contained in
this Agreement), (iii) will not be subject to preemptive rights, rights of first refusal or other
similar rights of stockholders of the Company or any other person, (iv) will not impose personal
liability upon the holder thereof and (v) and the holders shall be entitled to all rights accorded
to a holder of Common Stock



(f) No Conflicts. The execution, delivery and performance of this Agreement and the
other Transaction Documents by the Company and the consummation by the Company of the transactions
contemplated hereby and thereby (including, without limitation, the issuance of the Preferred Stock
and Warrants and the issuance and reservation for issuance of the Conversion Shares and Warrant
Shares) will not (i) result in a violation of the Certificate of Incorporation or Bylaws, (ii)
conflict with, or constitute a default (or an event that with notice or lapse of time or both would
become a default) under, or give to others any rights of termination, amendment (including, without
limitation, the triggering of any anti-dilution provisions), acceleration or cancellation of, any
agreement, indenture or instrument to which the Company or any of its Subsidiaries is a party, or
(iii) result in a violation of any law, rule, regulation, order, judgment or decree (including
United States federal and state securities laws, rules and regulations and rules and regulations of
any self-regulatory organizations to which either the Company or its securities are subject)
applicable to the Company or any of its Subsidiaries or by which any property or asset of the
Company or any of its Subsidiaries is bound or affected (except, with respect to clauses (ii) and
(iii), for such conflicts, defaults, terminations, amendments, accelerations, cancellations and
violations that would not, individually or in the aggregate, have a Material Adverse Effect).



(g) Compliance. Neither the Company nor any of its Subsidiaries is in violation of its



Certificate of Incorporation, Bylaws or other organizational documents, and neither the Company nor
any of its Subsidiaries is in default (and no event has occurred that with notice or lapse of time
or both would put the Company or any of its Subsidiaries in default) under, nor has there occurred
any event giving others (with notice or lapse of time or both) any rights of termination,
amendment, acceleration or cancellation of, any agreement, indenture or instrument to which the
Company or any of its Subsidiaries is a party. The businesses of the Company and its Subsidiaries
are not being conducted, and shall not be conducted so long as any Purchasers (or any of their
respective affiliates) own any of the Securities, in violation of any law, ordinance or regulation
of any governmental entity, except for possible violations the sanctions for which either singly or
in the aggregate have not had and would not have a Material Adverse Effect. Neither the Company,
nor any of its Subsidiaries, nor any director, officer, agent, employee or other person acting on
behalf of the Company or any Subsidiary has, in the course of his actions for, or on behalf of, the
Company, used any corporate funds for any unlawful contribution, gift, entertainment or other
unlawful expenses relating to political activity, made any direct or indirect unlawful payment to
any foreign or domestic government official or employee from corporate funds, violated or is in
violation of any provision of the U.S. Foreign Corrupt Practices Act of 1977, or made any bribe,
rebate, payoff, influence payment, kickback or other unlawful payment to any foreign or domestic
government official or employee. The Company and its Subsidiaries possess all certificates,
authorizations and permits issued by the appropriate federal, state, provincial or foreign
regulatory authorities that are material to the conduct to its business, and neither the Company
nor any of its Subsidiaries has received any notice of proceeding relating to the revocation or
modification of any such certificate, authorization or permit.



(h) SEC Documents, Financial Statements. Since December 31, 2005, the Company has
timely filed (within applicable extension periods) all reports, schedules, forms, statements and
other documents required to be filed by it with the SEC pursuant to the reporting requirements of
the Securities Exchange Act of 1934, as amended (the “Exchange Act”) (all of the foregoing filed
prior to the date hereof and all exhibits included therein and financial statements and schedules
thereto and documents incorporated by reference therein, the “SEC Documents”). The Company has
delivered or made available to each Purchaser true and complete copies of the SEC Documents. As of
their respective dates, the SEC Documents complied in all material respects with the requirements
of the Exchange Act or the Securities Act, as the case may be, and the rules and regulations of the
SEC promulgated thereunder applicable to the SEC Documents, and none of the SEC Documents, at the
time they were filed with the SEC, contained any untrue statement of a material fact or omitted to
state a material fact required to be stated therein or necessary in order to make the statements
therein, in light of the circumstances under which they were made, not misleading. None of the
statements made in any such SEC Documents is, or has been, required to be amended or updated under
applicable law (except for such statements as have been amended or updated in subsequent filings
made prior to the date hereof). As of their respective dates, the financial statements of the
Company included in the SEC Documents complied as to form in all material respects with applicable
accounting requirements and the published rules and regulations of the SEC applicable with respect
thereto. The Company has not provided to the Purchasers any material non-public information or
other information which, according to applicable law, rule or regulation, was required to have been
disclosed publicly by the Company but which has not been so disclosed, other than with respect to
the transactions contemplated by this Agreement. Such financial statements have been prepared in
accordance with U.S. generally accepted accounting principles (“GAAP”), consistently applied,
during the periods involved (except as may be otherwise indicated in such financial statements or
the notes thereto or, in the case of unaudited interim statements, to the extent they may not
include footnotes or may be condensed or summary statements) and fairly present in all material
respects the consolidated financial position of the Company and its consolidated Subsidiaries as of
the dates thereof and the consolidated results of their operations and cash flows for the periods
then ended (subject, in the case of unaudited statements, to immaterial year-end audit
adjustments). Except as set forth in the financial statements of the Company included in the Select
SEC Documents (as defined below), the Company has no liabilities, contingent or otherwise, other
than (i) liabilities incurred in the ordinary course of business subsequent to the date of such
financial statements and (ii) obligations under contracts and commitments incurred in the ordinary
course of business and not required under GAAP to be reflected in such financial statements, which
liabilities and obligations referred to in clauses (i) and (ii), individually or in the aggregate,
would not have a Material Adverse Effect. For purposes of this Agreement, “Select SEC Documents”
means the Company’s (A) Proxy Statement for its 2005 Annual Meeting, (B) Annual Report on Form 10-K
for the fiscal year ended December 31, 2005, and (C) all Current Reports on Form 8-K filed since
January 1, 2006 and WaveRider Communications Inc.’s (A) Proxy Statement for its Special Meeting of
Shareholders, held March 20, 2006, and (B) all Current Reports on Form 8-K filed since January 1,
2006.



(i) Absence of Certain Changes. Since December 31, 2005, there has been no material
adverse change and no material adverse development in the business, properties, operations,
prospects, financial condition or results of operations of the Company and its Subsidiaries, taken
as a whole. The Company has not taken any steps, and does not currently expect to take any steps,
to seek protection pursuant to any bankruptcy or receivership law, nor does the Company or any of
its Subsidiaries have any knowledge or reason to believe that its creditors intend to initiate
involuntary bankruptcy proceedings with respect to the Company or any of its Subsidiaries.



(j) Indebtedness. The Select SEC Documents or Section 3(j) of the Disclosure
Schedule sets forth as of a recent date all outstanding secured and unsecured Indebtedness of the
Company or any subsidiary, or for which the Company or any Subsidiary has commitments. For the
purposes of this Agreement, “Indebtedness” shall mean (a) any liabilities for borrowed money or
amounts owed in excess of $100,000 (other than trade accounts payable incurred in the ordinary
course of business), (b) all guaranties, endorsements and other contingent obligations in respect
of Indebtedness of others, whether or not the same are or should be reflected in the Company’s
balance sheet (or the notes thereto), except guaranties by endorsement of negotiable instruments
for deposit or collection or similar transactions in the ordinary course of business; and (c) the
present value of any lease payments in excess of $25,000 due under leases required to be
capitalized in accordance with GAAP. Except as set forth on Section 3(j) of the Disclosure
Schedule, neither the Company nor any Subsidiary is in default with respect to any
Indebtedness.



(k) Transactions With Affiliates. Except as set forth on the Select SEC Documents and
Section 3(k) of the Disclosure Schedule, none of the officers, directors, employees
consultant or director of the Company, or any of its subsidiaries, or any person owning any capital
stock of the Company or any subsidiary or any member of the immediate family of such officer,
employee, consultant, director or stockholder or any corporation or other entity controlled by such
officer, employee, consultant, director or stockholder, or a member of the immediate family of such
officer, employee, consultant, director or stockholder is a party to any transaction with the
Company or any of its Subsidiaries (other than for ordinary course services solely in their
capacity as officers, directors or employees), including any contracts, loan, leases, agreements,
royalty agreement, management contracts or arrangement or other continuing transactions.



(l) Absence of Litigation. Except as disclosed in the Select SEC Documents, there are
no actions, suits, proceedings, inquiries or investigations before or by any court, public board,
government agency, self-regulatory organization or body (including, without limitation, the SEC)
pending or affecting the Company, any of its Subsidiaries, or any of their respective directors or
officers in their capacities as such or, to the knowledge of the Company, threatened against the
Company or any Subsidiary which questions the validity of this Agreement or any of the other
Transaction Documents or the transactions contemplated hereby or thereby or any action taken or to
be taken pursuant hereto or thereto. Except as disclosed in the Select SEC Documents, there are no
actions, suits, proceedings, inquiries or investigations before or by any court, public board,
government agency, self-regulatory organization or body (including, without limitation, the SEC)
threatened against the Company, any of its subsidiaries, or any of their respective directors or
officers in their capacities as such, which, if determined adversely, could, either individually or
in the aggregate, have a Material Adverse Effect. There are no facts which, if known by a potential
claimant or governmental authority, could give rise to a claim or proceeding which, if asserted or
conducted with results unfavorable to the Company or any of its Subsidiaries, could reasonably be
expected to have a Material Adverse Effect. Except as set forth in the Select SEC Documents or
Section 3(l) of the Disclosure Schedule, there are no outstanding orders, judgments,
injunctions, awards or decrees of any court, arbitrator or governmental or regulatory body against
the Company or any Subsidiary or any officers or directors of the Company or Subsidiary in their
capacities as such.



(m) Intellectual Property. Each of the Company and its Subsidiaries owns or is duly
licensed (and, in such event, has the unfettered right to grant sublicenses) to use all patents,
patent applications, trademarks, trademark applications, trade names, service marks, copyrights,
copyright applications, licenses, permits, inventions, discoveries, processes, scientific,
technical, engineering and marketing data, object and source codes, know- how (including trade
secrets and other unpatented and/or unpatentable proprietary or confidential information, systems
or procedures) and other similar rights and proprietary knowledge (collectively, “Intellectual
Property”) necessary for the conduct of its business as now being conducted and as presently
contemplated to be conducted in the future (collectively, the “Company Intellectual Property”).
Section 3(m) of the Disclosure Schedule sets forth a list of all material Company Intellectual
Property owned and/or used by the Company in its business. Neither the Company nor any Subsidiary
of the Company infringes or is in conflict with any right of any other person with respect to any
third party Intellectual Property. Neither the Company nor any of its Subsidiaries has received
written notice of any pending conflict with or infringement upon any third party Intellectual
Property. Neither the Company nor any of its Subsidiaries has entered into any consent agreement,
indemnification agreement, forbearance to sue or settlement agreement with respect to the validity
of the Company’s or its Subsidiaries’ ownership of or right to use its Company Intellectual
Property and there is no reasonable basis for any such claim to be successful. The Company
Intellectual Property are valid and enforceable and no registration relating thereto has lapsed,
expired or been abandoned or canceled or is the subject of cancellation or other adversarial
proceedings, and all applications therefor are pending and in good standing. The Company and its
Subsidiaries have complied, in all material respects, with their respective contractual obligations
relating to the protection of the Company Intellectual Property used pursuant to licenses. No
person is infringing on or violating the Company Intellectual Property owned or used by the Company
or its Subsidiaries.



(n) Title. Each of the Company and its Subsidiaries have good and marketable title in
fee simple to all real property and good and merchantable title to all personal property owned by
them reflected in the Select SEC Documents, free and clear of all liens, encumbrances and defects
such that , individually or in the aggregate, do not cause a Material Adverse Effect on the
Company’s financial condition or operating results. Any real property and facilities held under
lease by the Company and its Subsidiaries are held by them under valid, subsisting and enforceable
leases with such exceptions as are not material and do not materially interfere with the use made
and proposed to be made of such property and buildings by the Company and its Subsidiaries.



(o) Tax Status. Except as set forth in the Select SEC Documents, the Company and each
of its Subsidiaries has made or filed all foreign, U.S. federal, state, provincial and local 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 and each of its Subsidiaries has set aside
on its books provisions reasonably adequate for the payment of all unpaid and unreported taxes) and
has paid all taxes and other governmental assessments and charges that are material in amount,
shown or determined to be due on such returns, reports and declarations, except those being
contested in good faith and has set aside on its books provisions reasonably adequate for the
payment of all taxes for periods subsequent to the periods to which such returns, reports or
declarations apply. There are no unpaid taxes in any material amount claimed to be due by the
taxing authority of any jurisdiction, and the Company has no knowledge of any basis for any such
claim. The Company has not executed a waiver with respect to any statute of limitations relating to
the assessment or collection of any foreign, federal, state, provincial or local tax. None of the
Company’s tax returns is presently being audited by any taxing authority.



(p) Key Employees. Neither the Company nor any Subsidiary has any collective
bargaining arrangements or agreements covering any of its employees, except as set forth in the
Select SEC Documents or on Section 3(p) of the Disclosure Schedule. Except as set forth in
the Select SEC Documents or on Section 3(p) of the Disclosure Schedule, neither the Company
nor any Subsidiary has any employment contract, agreement regarding proprietary information,
non-competition agreement, non-solicitation agreement, confidentiality agreement, or any other
similar contract or restrictive covenant, relating to the rights of any Key Employees. Each of the
Company’s directors and officers and any Key Employee (as defined below) is currently serving the
Company in the capacity disclosed in the Select SEC Documents. No Key Employee is, or is now
expected to be, in violation of any material term of any employment contract, confidentiality,
disclosure or proprietary information agreement, non-competition agreement, or any other contract
or agreement or any restrictive covenant, and the continued employment of each Key Employee does
not subject the Company or any of its Subsidiaries to any material liability with respect to any of
the foregoing matters. No Key Employee has, to the knowledge of the Company and its Subsidiaries,
any intention to terminate or limit his employment with, or services to, the Company or any of its
Subsidiaries, nor is any such Key Employee subject to any constraints which would cause such
employee to be unable to devote his full time and attention to such employment or services. For
purposes of this Agreement, “Key Employee” means the persons listed in Section 3(p) of the
Disclosure Schedule and any individual who assumes or performs any of the duties of a Key Employee.



(q) Employee Relations. (i) No application or petition for certification of a
collective bargaining agent is pending and none of the employees of Company or any of its
Subsidiaries are or have been represented by any union or other bargaining representative and no
union has attempted to organize any group of the Company’s employees, and no group of the Company’s
employees has sought to organize themselves into a union or similar organization for the purpose of
collective bargaining. The Company and its Subsidiaries believe that their relations with their
employees are good; (ii) no executive officer (as defined in Rule 501(f) of the Securities Act) has
notified the Company that such officer intends to leave the Company or otherwise terminate such
officer’s employment with the Company; and (iii) the Company and its Subsidiaries are in compliance
with all federal, state and local laws and regulations and, to the Company’s knowledge, all foreign
laws and regulations, in each case respecting employment and employment practices, terms and
conditions of employment and wages and hours, except where failure to be in compliance would not,
either individually or in the aggregate, result in a Material Adverse Effect.



(r) Insurance. The Company and each of its Subsidiaries has in force fire, casualty,
product liability and other insurance policies, with extended coverage, sufficient in amount to
allow it to replace any of its material properties or assets which might be damaged or destroyed or
sufficient to cover liabilities to which the Company may reasonably become subject, and such types
and amounts of other insurance with respect to its business and properties, on both a per
occurrence and an aggregate basis, as are customarily carried by persons engaged in the same or
similar business as the Company. No default or event has occurred that could give rise to a default
under any such policy.



(s) Environmental Matters. The Company and each of its Subsidiaries have obtained all
material approvals, authorization, certificates, consents, licenses, orders and permits or other
similar authorizations of all governmental authorities, or from any other person, that are required
under any Environmental Laws. The Select SEC Documents describe all material permits, licenses
and other authorizations issued under any Environmental Laws to the Company or its Subsidiaries.
The Company has all necessary governmental approvals required under all Environmental Laws and used
in its business or in the business of any of its subsidiaries. The Company and each of its
subsidiaries are also in compliance with all other limitations, restrictions, conditions,
standards, requirements, schedules and timetables required or imposed under all Environmental Laws.
Except for such instances as would not individually or in the aggregate have a Material Adverse
Effect, there are no past or present events, conditions, circumstances, incidents, actions or
omissions relating to or in any way affecting the Company or its subsidiaries that violate or may
violate any Environmental Law after the Closing Date or that may give rise to any environmental
liability, or otherwise form the basis of any claim, action, demand, suit, proceeding, hearing,
study or investigation (i) under any Environmental Law, or (ii) based on or related to the
manufacture, processing, distribution, use, treatment, storage (including without limitation
underground storage tanks), disposal, transport or handling, or the emission, discharge, release or
threatened release of any hazardous substance. There is no environmental litigation or other
environmental proceeding pending or threatened by any governmental regulatory authority or others
with respect to the current or any former business of the Company or any of its Subsidiaries or any
partnership or joint venture currently or at any time affiliated with the Company or any of its
Subsidiaries. No state of facts exists as to environmental matters or Hazardous Substances that
involves the reasonable likelihood of a material capital expenditure by the Company or any of its
Subsidiaries that may otherwise have a Material Adverse Effect. No Hazardous Substances have been
treated, stored or disposed of, or otherwise deposited, in or on the properties owned or leased by
the Company or any of its Subsidiaries or by any partnership or joint venture currently or at any
time affiliated with the Company or any of its Subsidiaries in violation of any applicable
environmental laws. The environmental compliance programs of the Company and each of its
Subsidiaries comply in all respects with all environmental laws, whether foreign, federal, state,
provincial or local, currently in effect. For purposes of this Agreement, “Hazardous Substances”
means any substance, waste, contaminant, pollutant or material that has been determined by any
governmental authority to be capable of posing a risk of injury to health, safety, property or the
environment. “Environmental Laws” shall mean all applicable laws relating to the protection of the
environment including, without limitation, all requirements pertaining to reporting, licensing,
permitting, controlling, investigating or remediating emissions, discharges, releases or threatened
releases of hazardous substances, chemical substances, pollutants, contaminants or toxic
substances, materials or wastes, whether solid, liquid or gaseous in nature, into the air, surface
water, groundwater or land, or relating to the manufacture, processing, distribution, use,
treatment, storage, disposal, transport or handling of hazardous substances, chemical substances,
pollutants, contaminants or toxic substances, material or wastes, whether solid, liquid or gaseous
in nature.



(t) Operation of Business. The Company and each of the subsidiaries owns or possesses
all patents, trademarks, domain names (whether or not registered) and any patentable improvements
or copyrightable derivative works thereof, websites and intellectual property rights relating
thereto, service marks, trade names, copyrights, licenses and authorizations as set forth in the
Select SEC Documents and on Section 3(t) of the Disclosure Schedule, and all rights with
respect to the foregoing, which are necessary for the conduct of its business as now conducted
without any conflict with the rights of others.



(u) Listing. The Company is not in violation of the listing requirements of the OTC
Electronic Bulletin Board (the “Bulletin Board”) on which it trades, does not reasonably anticipate
that the Common Stock will be delisted by the Bulletin Board for the foreseeable future, and has
not received any notice regarding the possible delisting of the Common Stock from the Bulletin
Board. The Company has secured the listing of the Conversion Shares and Warrant Shares upon each
national securities exchange, automated quotation system or over the counter market upon which
shares of Common Stock are currently listed (subject to official notice of issuance).



(v) Material Agreements. Except as set forth in the Select SEC Documents or on
Section 3(v) of the Disclosure Schedule, neither the Company nor any Subsidiary is a party
to any written or oral contract, instrument, agreement, commitment, obligation, plan or
arrangement, a copy of which would be required to be filed with the SEC as an exhibit to a
registration statement on Form S-1 or applicable form (collectively, “Material Agreements”) if the
Company or any subsidiary were registering securities under the Securities Act. Except as set
forth on Section 3(v) of the Disclosure Schedule or in the SEC Documents, the Company and
each of its Subsidiaries has in all material respects performed all the obligations required to be
performed by them to date under the foregoing agreements, have received no notice of default and,
to the best of the Company’s knowledge are not in default under any Material Agreement now in
effect, the result of which could cause a Material Adverse Effect. Except as set forth on
Section 3(v) of the Disclosure Schedule or in the SEC Documents, no written or oral
contract, instrument, agreement, commitment, obligation, plan or arrangement of the Company or of
any subsidiary limits or shall limit the payment of dividends on the Company’s Preferred Stock,
other Preferred Stock, if any, or its Common Stock.



(w) Securities Act of 1933. Based in material part upon the representations herein of
the Purchasers, the Company has complied and will comply with all applicable federal and state
securities laws in connection with the offer, issuance and sale of the Securities hereunder.
Neither the Company nor anyone acting on its behalf, directly or indirectly, has or will sell,
offer to sell or solicit offers to buy any of the Securities or similar securities to, or solicit
offers with respect thereto from, or enter into any preliminary conversations or negotiations
relating thereto with, any person, or has taken or will take any action so as to bring the issuance
and sale of any of the Securities under the registration provisions of the Securities Act and
applicable state securities laws, and neither the Company nor any of its affiliates, nor any person
acting on its or their behalf, has engaged in any form of general solicitation or general
advertising (within the meaning of Regulation D under the Securities Act) in connection with the
offer or sale of any of the Securities.



(x) Governmental Approvals. Except for the filing of any notice prior or subsequent
to the Closing Date that may be required under applicable state and/or Federal securities laws
(which if required, shall be filed on a timely basis), including the filing of a Form D and a
registration statement or statements pursuant to the Registration Rights Agreement, and the filing
of the Certificate of Designation with the Secretary of State for the State of Delaware, no
authorization, consent, approval, license, exemption of, filing or registration with any court or
governmental department, commission, board, bureau, agency or instrumentality, domestic or foreign,
is or will be necessary for, or in connection with, the execution or delivery of the Preferred
Stock and the Warrants, or for the performance by the Company of its obligations under the
Transaction Documents.



(y) Absence of Certain Developments. Except as provided on the Select SEC Documents
and Section 3(y) of the Disclosure Schedule, since December 31, 2005, neither the Company
nor any subsidiary has:




	 	1.	 	issued any stock, bonds or other corporate securities or any rights, options or
warrants with respect thereto;






	 	2.	 	borrowed any amount or incurred or become subject to any liabilities (absolute
or contingent) except current liabilities incurred in the ordinary course of business
which are comparable in nature and amount to the current liabilities incurred in the
ordinary course of business during the comparable portion of its prior fiscal year, as
adjusted to reflect the current nature and volume of the Company’s or such subsidiary’s
business;






	 	3.	 	discharged or satisfied any lien or encumbrance or paid any obligation or
liability (absolute or contingent), other than current liabilities paid in the ordinary
course of business;






	 	4.	 	declared or made any payment or distribution of cash or other property to
stockholders with respect to its stock, or purchased or redeemed, or made any
agreements so to purchase or redeem, any shares of its capital stock;






	 	5.	 	sold, assigned or transferred any other tangible assets, or canceled any debts
or claims, except in the ordinary course of business;






	 	6.	 	sold, assigned or transferred any patent rights, trademarks, trade names,
copyrights, trade secrets or other intangible assets or intellectual property rights,
or disclosed any proprietary confidential information to any person except to customers
in the ordinary course of business or to the Purchasers or their representatives;






	 	7.	 	suffered any substantial losses or waived any rights of material value, whether
or not in the ordinary course of business, or suffered the loss of any material amount
of prospective business;






	 	8.	 	made any changes in employee compensation except in the ordinary course of
business and consistent with past practices;






	 	9.	 	made capital expenditures or commitments therefor that aggregate in excess of
$100,000;






	 	10.	 	entered into any other transaction other than in the ordinary course of
business, or entered into any other material transaction, whether or not in the
ordinary course of business;






	 	11.	 	made charitable contributions or pledges in excess of $25,000;






	 	12.	 	suffered any material damage, destruction or casualty loss, whether or not
covered by insurance;






	 	13.	 	experienced any material problems with labor or management in connection with
the terms and conditions of their employment;






	 	14.	 	effected any two or more events of the foregoing kind which in the aggregate
would be material to the Company or its subsidiaries; or






	 	15.	 	entered into an agreement, written or otherwise, to take any of the foregoing
actions.





(z) Public Utility Holding Company Act and Investment Company Act Status. The Company
is not a “holding company” or a “public utility company” as such terms are defined in the Public
Utility Holding Company Act of 1935, as amended. The Company is not, and as a result of and
immediately upon the Closing will not be, an “investment company” or a company “controlled” by an
“investment company,” within the meaning of the Investment Company Act of 1940, as amended.



(aa) ERISA. No liability to the Pension Benefit Guaranty Corporation has been
incurred with respect to any Plan by the Company or any of its subsidiaries which is or would be
materially adverse to the Company and its subsidiaries. The execution and delivery of this
Agreement and the issuance and sale of the Preferred Stock will not involve any transaction which
is subject to the prohibitions of Section 406 of ERISA or in connection with which a tax could be
imposed pursuant to Section 4975 of the Internal Revenue Code of 1986, as amended, provided that,
if any of the Purchasers, or any person or entity that owns a beneficial interest in any of the
Purchasers, is an “employee pension benefit plan” (within the meaning of Section 3(2) of ERISA)
with respect to which the Company is a “party in interest” (within the meaning of Section 3(14) of
ERISA), the requirements of Sections 407(d)(5) and 408(e) of ERISA, if applicable, are met. As
used in this Section 3(aa), the term “Plan” shall mean an “employee pension benefit plan” (as
defined in Section 3 of ERISA) which is or has been established or maintained, or to which
contributions are or have been made, by the Company or any subsidiary or by any trade or business,
whether or not incorporated, which, together with the Company or any subsidiary, is under common
control, as described in Section 414(b) or (c) of the Code.



(bb) Anti-Takeover Provisions. The Company and its board of directors have taken all
necessary action, if any, in order to render inapplicable any control share acquisition, business
combination, poison pill (including any distribution under a rights agreement) or other similar
anti-takeover provision under its Certificate of Incorporation or the laws of the state of its
incorporation which is or could become applicable to any Purchaser as a result of the transactions
contemplated by this Agreement, including without limitation, the Company’s issuance of the
Securities and any and all Purchaser’s ownership of the Securities. Except as specifically
contemplated by this Agreement, the Company is not required to obtain any consent, approval,
authorization or order of, or make any filing or registration with, any court or governmental
agency or any regulatory or self-regulatory agency or other third party in order for it to execute,
deliver or perform any of its obligations under this Agreement or any of the other Transaction
Documents, in each case in accordance with the terms hereof or thereof.



(cc) Independent Nature of Purchasers. The Company acknowledges that the obligations
of each Purchaser under the Transaction Documents are several and not joint with the obligations of
any other Purchaser, and no Purchaser shall be responsible to the Company in any way for the
performance of the obligations of any other Purchaser under the Transaction Documents. The Company
acknowledges that nothing contained herein, or in any Transaction Document, and no action taken by
any Purchaser pursuant hereto or thereto, shall be deemed by the Company to constitute the
Purchasers as a partnership, an association, a joint venture or any other kind of entity, or create
a presumption by the Company that the Purchasers are in any way acting in concert or as a group
with respect to such obligations or the transactions contemplated by the Transaction Documents.
The Company acknowledges that each Purchaser shall be entitled to independently protect and enforce
its rights, including without limitation, the rights arising out of this Agreement or out of the
other Transaction Documents against the Company, and it shall not be necessary for any other
Purchaser to be joined as an additional party in any proceeding for such purpose. The Company
acknowledges that for reasons of administrative convenience only, the Transaction Documents have
been prepared by counsel for the placement agent and such counsel does not represent the Purchasers
and the Purchasers have retained their own individual counsel with respect to the transactions
contemplated hereby.  The Company acknowledges that it has elected to provide all Purchasers with
the same terms and Transaction Documents for the convenience of the Company and not because it was
required or requested to do so by the Purchasers. The Company acknowledges that such procedure
with respect to the Transaction Documents in no way creates a presumption by the Company that the
Purchasers are in any way acting in concert or as a group with respect to the Transaction Documents
or the transactions contemplated hereby or thereby.



(dd) No General Solicitation or Integrated Offering. Neither the Company nor any
distributor participating on the Company’s behalf in the transactions contemplated hereby (if any)
nor any person acting for the Company, or any such distributor, has conducted any “general
solicitation” (as such term is defined in Regulation D) with respect to any of the Securities being
offered hereby. Neither the Company nor any of its affiliates, nor any person acting on its or
their behalf, has directly or indirectly made any offers or sales of any security or solicited any
offers to buy any security under circumstances that would cause the offering of the Securities
pursuant to this Agreement to be integrated with any prior offering of securities of the Company
for purposes of the Securities Act which would prevent the Company from selling the Securities
pursuant to Rule 506 under the Securities Act, or any applicable exchange-related stockholder
approval provisions, nor will the Company or any of its affiliates or subsidiaries take any action
or steps that would cause the offering of the Securities to be integrated with other offerings.
Except as set forth on Section 3(dd) of the Disclosure Schedule, the Company does not have
any registration statement pending before the SEC or currently under the SEC’s review and since
October 1, 2005, the Company has not offered or sold any of its equity securities or debt
securities convertible into shares of Common Stock.



(ee) Certain Fees. Except as set forth in this Agreement or on Section 3(ee)
of the Disclosure Schedule, no brokers, finders or financial advisory fees or commissions will be
payable by the Company or any subsidiary or any Purchaser with respect to the transactions
contemplated by this Agreement.



(ff) Sarbanes-Oxley Act. The Company is in compliance with the applicable provisions
of the Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley Act”), and the rules and regulations
promulgated thereunder, that are effective, and intends to comply with other applicable provisions
of the Sarbanes-Oxley Act, and the rules and regulations promulgated thereunder, upon the
effectiveness of such provisions.



(gg) Acknowledgment Regarding Securities. The number of Conversion Shares issuable
upon conversion of the Preferred Stock and the number of Warrant Shares issuable upon exercise of
the Warrants may increase in certain circumstances. The Company’s directors and executive officers
have studied and fully understand the nature of the Securities being sold hereunder. The Company
acknowledges that its obligation to issue Conversion Shares upon conversion of the Preferred Stock
in accordance with the terms thereof and the Warrant Shares upon the exercise of the Warrants in
accordance with the terms thereof is absolute and unconditional, regardless of the dilution that
such issuance may have on the ownership interests of other stockholders and the availability of
remedies provided for in any of the Transaction Documents relating to a failure or refusal to issue
Conversion Shares or Warrant Shares.



(hh) Disclosure. All information relating to or concerning the Company and/or any of
its Subsidiaries set forth in this Agreement or provided to the Purchasers pursuant to Section 2(d)
hereof or otherwise by the Company in connection with the transactions contemplated hereby is true
and correct in all material respects and the Company has not omitted to state any material fact
necessary in order to make the statements made herein or therein, in light of the circumstances
under which they were made, not misleading. No event or circumstance has occurred or exists with
respect to the Company or its Subsidiaries or their respective businesses, properties, prospects,
operations or financial conditions, which has not been publicly disclosed but, under applicable
law, rule or regulation, would be required to be disclosed by the Company in a registration
statement filed on the date hereof by the Company under the Securities Act with respect to a
primary issuance of the Company’s securities.



4. COVENANTS.



(a) Best Efforts. The parties shall use their respective best efforts timely to
satisfy each of the conditions described in Sections 6 and 7 of this Agreement.



(b) Form D; Blue Sky Laws. The Company shall file with the SEC a Form D with respect
to the Securities as required under Regulation D and provide a copy thereof to each Purchaser
promptly after such filing. The Company shall, on or before the Closing Date, take such action as
the Company shall reasonably determine is necessary to qualify the Securities for sale to each
Purchaser pursuant to this Agreement under applicable securities or “blue sky” laws of the states
of the United States or obtain exemption therefrom, and shall provide evidence of any such action
so taken to each Purchaser on or prior to the applicable Closing Date.



(c) Reporting Status. So long as any Purchasers (or any of their respective
affiliates) beneficially own any of the Securities, the Company shall timely file all reports
required to be filed with the SEC pursuant to the Exchange Act, and the Company shall not terminate
its status as an issuer required to file reports under the Exchange Act even if the Exchange Act or
the rules and regulations thereunder would permit such termination. In addition, the Company shall
take all actions necessary to meet the “registrant eligibility” requirements set forth in the
general instructions to Form S-1 or any successor form thereto, to continue to be eligible to
register the resale of its Common Stock on a registration statement on Form S-1 under the
Securities Act.



(d) Reporting Requirements. If the SEC ceases making periodic reports filed under
Section 13 of the Exchange Act available via the Internet, then at a Purchaser’s request the
Company shall furnish the following to such Purchaser so long as such Purchaser shall be obligated
hereunder to purchase the Preferred Stock or shall beneficially own any Preferred Stock, or shall
own Conversion Shares which, in the aggregate, represent more than 2% of the total combined voting
power of all voting securities then outstanding:



(1) Quarterly Reports filed with the SEC on Form 10-Q as soon as practical after the document
is filed with the SEC, and in any event within five (5) days after the document is filed with the
SEC;



(2) Annual Reports filed with the SEC on Form 10-K as soon as practical after the document is
filed with the SEC, and in any event within five (5) days after the document is filed with the SEC;
and



(3) Copies of all notices and information, including without limitation notices and proxy
statements in connection with any meetings, that are provided to holders of shares of Common Stock,
contemporaneously with the delivery of such notices or information to such holders of Common Stock.



(e) Amendments. The Company shall not amend or waive any provision of the Certificate
or Bylaws of the Company in any way that would adversely affect the liquidation preferences,
dividends rights, conversion rights, voting rights or redemption rights of the Preferred Stock;
provided, however, that any creation and issuance of another series of Junior Stock
(as defined in the Certificate of Designation) or any other class or series of equity securities
which by its terms shall rank on parity with the Preferred Stock shall not be deemed to materially
and adversely affect such rights, preferences or privileges.



(f) Other Agreements. The Company shall not enter into any agreement in which the
terms of such agreement would restrict or impair the right or ability to perform of the Company or
any subsidiary under any Transaction Document.



(g) Distributions. So long as any Preferred Stock or Warrants remain outstanding, the
Company agrees that it shall not purchase or otherwise acquire for value, directly or indirectly,
any Common Stock or other equity security of the Company.



(h) Use of Proceeds. The Company shall use the proceeds from the sale and issuance of
the Preferred Stock and Warrants to pay certain legacy obligations of the Company, and for general
corporate purposes and working capital. Such remaining proceeds shall not be used to (i) pay
dividends; (ii) pay for any increase in executive compensation or make any loan or other advance to
any officer, employee, shareholder, director or other affiliate of the Company, without the express
approval of the Board of Directors acting in accordance with past practice; (iii) purchase debt or
equity securities of any entity (including redeeming the Company’s own securities), except for (A)
evidences of indebtedness issued or fully guaranteed by the United States of America and having a
maturity of not more than one year from the date of acquisition, (B) certificates of deposit,
notes, acceptances and repurchase agreements having a maturity of not more than one year from the
date of acquisition issued by a bank organized in the United States having capital, surplus and
undivided profits of at least $500,000,000, (C) the highest-rated commercial paper having a
maturity of not more than one year from the date of acquisition, and (D) “Money Market” fund
shares, or money market accounts fully insured by the Federal Deposit Insurance Corporation and
sponsored by banks and other financial institutions, provided that the investments consist
principally of the types of investments described in clauses (A), (B), or (C) above; or (iv) make
any investment not directly related to the current business of the Company.



(i) Financial Information. The Company shall send (via electronic transmission or
otherwise), or make available via its website at www.wavewireless.com, the following
reports (or notification of their availability to the public) to the Purchasers until the
Purchasers transfer, assign or sell all of their Securities: (i) within ten days after the filing
with the SEC, a copy of its Annual Report on Form 10-K, its Quarterly Reports on Form 10-Q, its
proxy statements and any Current Reports on Form 8-K; and (ii) within one day after release, copies
of all press releases issued by the Company or any of its Subsidiaries.



(j) Reservation of Shares. So long as any of the Preferred Stock or Warrants remain
outstanding, the Company shall take all action necessary to at all times have authorized, and
reserved for the purpose of issuance, no less than one hundred percent (100%) of the aggregate
number of shares of Common Stock needed to provide for the issuance of the Conversion Shares and
shall, upon the Company filing the Charter Amendment (as defined in Section 4(w) hereof), take all
action necessary to at all times have authorized, and reserved for the purpose of issuance, no less
than one hundred percent (100%) of the aggregate number of shares of Common Stock needed to provide
for the issuance of the Conversion Shares and the Warrant Shares.



(k) Listing. The Company shall maintain, so long as any Purchasers (or any of their
respective affiliates) beneficially own any Securities, the listing of all Conversion Shares and
Warrant Shares from time to time issuable upon conversion of the Preferred Stock and exercise of
the Warrants on each national securities exchange, automated quotation system or electronic
bulletin board on which shares of Common Stock are currently listed. The Company will use its best
efforts to continue the listing and trading of its Common Stock on the Bulletin Board or the Nasdaq
Capital Market (the “Capital Market”), Nasdaq National Market (the “National Market”), the New York
Stock Exchange (the “NYSE”) or the American Stock Exchange (the “AMEX”) and will comply in all
respects with the reporting, filing and other obligations under the bylaws or rules of the National
Association of Securities Dealers, Inc. (the “NASD”), such exchanges, or such electronic system, as
applicable. The Company shall promptly provide to each Purchaser copies of any notices it receives
regarding the continued eligibility of the Common Stock for trading on the Bulletin Board or on any
securities exchange or automated quotation system on which securities of the same class or series
issued by the Company are then listed or quoted, if any.



(l) Corporate Existence. So long as any Purchasers (or any of their respective
affiliates) beneficially own any Securities, the Company shall maintain its corporate existence,
and in the event of a merger, consolidation or sale of all or substantially all of the Company’s
assets, the Company shall ensure that the surviving or successor entity in such transaction and, if
an entity different from the successor or acquiring entity, the entity whose securities into which
the Common Stock shall become convertible or exchangeable in such transaction (i) assumes the
Company’s obligations under this Agreement and the other Transaction Documents and the agreements
and instruments entered into in connection herewith and therewith regardless of whether or not the
Company would have had a sufficient number of shares of Common Stock authorized and available for
issuance in order to effect the conversion of all the Preferred Stock and exercise in full of all
Warrants outstanding as of the date of such transaction and (ii) except in the event of a merger,
consolidation of the Company into any other corporation, or the sale or conveyance of all or
substantially all of the assets of the Company where the consideration consists solely of cash, the
surviving or successor entity and, if an entity different from the successor or acquiring entity,
the entity whose securities into which the Common Stock shall become convertible or exchangeable in
such transaction, is a publicly traded corporation whose common stock is listed for trading on the
Capital Market, National Market, the NYSE or the AMEX.



(m) No Integrated Offerings. The Company shall not make any offers or sales of any
security (other than the Securities) under circumstances that would require registration of the
Securities being offered or sold hereunder under the Securities Act or cause this offering of the
Securities to be integrated with any other offering of securities by the Company for purposes of
any stockholder approval provision applicable to the Company or its securities.



(n) Legal Compliance. The Company shall conduct its business and the business of its
Subsidiaries in compliance with all laws, ordinances or regulations of governmental entities
applicable to such businesses, except where the failure to do so would not have a Material Adverse
Effect.



(o) Information. The Company shall keep at its principal executive office a true copy
of this Agreement (as at the time in effect), and cause the same to be available for inspection at
such office during normal business hours by any holder of Securities or any prospective transferee
of Securities designated by a holder thereof.



(p) Keeping of Records and Books of Account. The Company shall keep and cause each
subsidiary to keep adequate records and books of account, in which complete entries will be made in
accordance with GAAP consistently applied, reflecting all financial transactions of the Company and
its subsidiaries, and in which, for each fiscal year, all proper reserves for depreciation,
depletion, obsolescence, amortization, taxes, bad debts and other purposes in connection with its
business shall be made.



(q) Disclosure of Transaction. The Company shall issue a press release describing the
material terms of the transactions contemplated hereby (the “Press Release”) as soon as practicable
after the Closing but in no event later than one hour after the Closing; provided, however, that if
the Closing occurs after 4:00 P.M. Eastern Time on any Trading Day, the Company shall issue the
Press Release no later than 9:00 A.M. Eastern Time on the first Trading Day following the Closing
Date. The Company shall also file with the SEC a Current Report on Form 8-K (the “Form 8-K”)
describing the material terms of the transactions contemplated hereby (and attaching as exhibits
thereto this Agreement, the Registration Rights Agreement, the Certificate of Designation, the form
of each series of Warrant and the Press Release) as soon as practicable following the Closing Date
but in no event more than two (2) Trading Days following the Closing Date, which Press Release and
Form 8-K shall be subject to prior review and comment by the Purchasers. “Trading Day” means any
day during which the OTC Bulletin Board (or other principal exchange on which the Common Stock is
traded) shall be open for trading.



(r) Inspection of Properties and Books. So long as any Purchaser beneficially owns any
Securities, such Purchaser and its representatives and agents (collectively, the “Inspectors”)
shall have the right, at such Purchaser’s expense, to visit and inspect any of the properties of
the Company and of its Subsidiaries, to examine the books of account and records of the Company and
of its Subsidiaries, to make or be provided with copies and extracts therefrom, to discuss the
affairs, finances and accounts of the Company and of its Subsidiaries with, and to be advised as to
the same by, its and their officers, employees and independent public accountants (and by this
provision the Company authorizes such accountants to discuss such affairs, finances and accounts,
whether or not a representative of the Company is present) all at such reasonable times and
intervals and to such reasonable extent as the Purchasers may desire; provided, however, that each
Inspector shall hold in confidence and shall not make any disclosure (except to such Purchaser) of
any such information which the Company determines in good faith to be confidential, and of which
determination the Inspectors are so notified, unless (i) the disclosure of such information is
necessary to avoid or correct a misstatement or omission in any Registration Statement filed
pursuant to the Registration Rights Agreement, (ii) the release of such information is ordered
pursuant to a subpoena or other order from a court or government body of competent jurisdiction, or
(iii) such information has been made generally available to the public other than by disclosure in
violation of this or any other agreement. Each Purchaser agrees that it shall, upon learning that
disclosure of such information is sought in or by a court or governmental body of competent
jurisdiction or through other means, give prompt notice to the Company and allow the Company, at
its expense, to undertake appropriate action to prevent disclosure of, or to obtain a protective
order for, the information deemed confidential.



(s) Pledge of Securities. The Company acknowledges and agrees that the Securities may
be pledged by any Purchaser in connection with a bona fide margin agreement or other loan or
financing arrangement that is secured by the Securities. The pledge of Securities shall not be
deemed to be a transfer, sale or assignment of the Securities hereunder, and no Purchaser effecting
a pledge of Securities shall be required to provide the Company with any notice thereof or
otherwise make any delivery to the Company pursuant to this Agreement or any other Transaction
Document. The Company shall execute and deliver such documentation as a pledgee of the Securities
may reasonably request in connection with a pledge of the Securities to such pledgee by a
Purchaser.



(t) Variable Securities. The Company shall not, in any manner, issue or sell any
rights, warrants or options to subscribe for or purchase Common Stock, or any other securities
directly or indirectly convertible into or exchangeable or exercisable for Common Stock, at an
effective conversion, exchange or exercise price that varies or may vary with the market price of
the Common Stock, including by way of one or more reset(s) to any fixed price.



(u) Fees and Expenses. Each party shall pay the fees and expenses of its advisors,
counsel, accountants and other experts, if any, and all other expenses, incurred by such party
incident to the negotiation, preparation, execution, delivery and performance of this Agreement.



(v) Participation Right; Exchange Rights. Subject to the terms and conditions
specified in this Section 4(v), for a period of one year calculated from the Closing Date, the
holders of Preferred Stock shall have a right to participate with respect to the issuance or
possible issuance of (i) equity or equity-linked securities, or (ii) debt which is convertible into
equity or in which there is an equity component (“Additional Securities”) on the same terms and
conditions as offered by the Company to the other purchasers of such Additional Securities. Each
time the Company proposes to offer any Additional Securities, the Company shall make an offering of
such Additional Securities to each Purchaser in accordance with the following provisions:



(i) the Company shall deliver a notice (the “Notice”) to the holders of Preferred Stock
stating (i) its bona fide intention to offer such Additional Securities, (ii) the number of such
Additional Securities to be offered, (iii) the price and terms, if any, upon which it proposes to
offer such Additional Securities, and (iv) the anticipated closing date of the sale of such
Additional Securities;



(ii) by written notification received by the Company within five (5) trading days after giving
of the Notice, any holder of Preferred Stock may elect to purchase or obtain, at the price and
on the terms specified in the Notice, up to that portion of such Additional Securities that have
a total purchase price equal to one half of the face amount of the Preferred Stock held by such
holder (including any shares of Preferred Stock that have been converted into Common Stock). The
Company shall promptly, in writing, inform each holder of Preferred Stock that elects to purchase
all of the Additional Shares available to it (“Fully-Exercising Holder”) of any other holder of
Preferred Stock’s failure to do likewise. During the five (5) trading day period commencing after
such information is given, each Fully-Exercising Holder shall be entitled to obtain that portion of
the Additional Securities for which the holders of Preferred Stock were entitled to subscribe but
that were not subscribed for by the holders of Preferred Stock that is equal to the proportion that
the face amount of the Preferred Stock held by such Fully-Exercising Holder (including any shares
of Preferred Stock that have been converted into Common Stock) bears to the total face amount of
the Preferred Stock held by all holders of Preferred Stock (including any shares of Preferred Stock
that have been converted into Common Stock);



(iii) notwithstanding the provisions of Section 4(v)(ii), for a period of one year calculated
from the effective date of the Registration Statement, by written notification received by the
Company within five (5) trading days after giving of the Notice, any holder of Preferred Stock may
elect to purchase or obtain, at the price and on the terms specified in the Notice, up to that
portion of such Additional Securities that have a total purchase price equal to the face amount of
the Preferred Stock held by such holder (including any shares of Preferred Stock that have been
converted into Common Stock); provided, however, that any holder of Preferred Stock who elects to
purchase Additional Securities pursuant to this Section 4(v) shall be required to surrender to the
Company Preferred Stock (or Common Stock issued on the conversion of such Preferred Stock) for
which the face amount (plus all accrued but unpaid dividends) equals the total purchase price of
the Additional Securities to be acquired by such holder of Preferred Stock, and the Company shall
accept such Preferred Stock (or Common Stock issued on the conversion of such Preferred Stock)
as payment in full for such Additional Securities. The provisions of this Section 4(v)(iii) shall
be of no further force or effect upon the consummation of any transaction resulting in the issuance
of the Company’s Common Stock in connection with a bona fide offering at an offering price per
share (prior to any underwriter’s commissions and discounts) of not less than $0.075 (as adjusted
to reflect any stock dividends, distributions, combinations, reclassifications and other
similar transactions effected by the Company in respect to its Common Stock) that results in
total net proceeds to the Company of at least $2,500,000;



(iv) if all Additional Securities which the holders of Preferred Stock are entitled to obtain
pursuant to Section 4(v)(ii) or Section 4(v)(iii) are not elected to be obtained as provided in
subsection Section 4(v)(ii) or Section 4(v)(iii) hereof, the Company may, during the 75-day period
following the expiration of the period provided in subsection Section 4(v)(ii) or Section
4(v)(iii)) hereof, offer the remaining unsubscribed portion of such Additional Securities to any
person or persons at a price not less than, and upon terms no more favorable to the offeree than,
those specified in the Notice. If the Company does not consummate the sale of such Additional
Securities within such period, the right provided hereunder shall be deemed to be revived and such
Additional Securities shall not be offered or sold unless first reoffered to the holders of
Preferred Stock in accordance herewith;



(v) the participation right in this Section 4(v) shall not be applicable to (i) the issuance
or sale of shares of Common Stock (or options therefor) to employees, officers, directors, or
consultants of the Company for the primary purpose of soliciting or retaining their employment
or service pursuant to a stock option plan (or similar equity incentive plan) approved in good
faith by the Board of Directors, (ii) the issuance of Common Stock in connection with a bona fide
underwritten public offering at an offering price per share (prior to underwriter’s commissions
and discounts) of not less than 200% of the Conversion Price (as adjusted to reflect any stock
dividends, distributions, combinations, reclassifications and other similar transactions effected
by the Company in respect to its Common Stock) that results in total proceeds to the Company of
at least $10,000,000, (iii) the issuance or sale of the Preferred Stock, (iv) the issuance of
securities in connection with mergers, acquisitions, strategic business partnerships or joint
ventures approved by the Board of Directors and the primary purpose of which, in the reasonable
judgment of the Board of Directors, is not to raise additional capital or (v) any issuance of
securities as to which the Majority Holders shall have executed a written waiver of the rights
contained in this Section 4(v); and



(vi) the participation right set forth in this Section 4(v) may not be assigned or
transferred, except that such right is assignable by each holder of Preferred Stock to any
wholly-owned subsidiary or parent of, or to any corporation or entity that is, within the meaning
of the Securities Act, controlling, controlled by or under common control with, any such holder of
Preferred Stock.



(w) Increase in Authorized Shares. The Company shall obtain the approval of its
stockholders no later than December 31, 2006 (the “Amendment Date”) to increase the Company’s
authorized shares of Common Stock to the number of shares of Common Stock sufficient to reserve one
hundred percent (100%) of the number of shares of Common Stock as shall from time to time be
sufficient to effect the conversion of all of the Preferred Stock and exercise of the Warrants then
outstanding (the “Share Increase”). Within two (2) business days of receiving such stockholder
approval, the Company shall file an amendment to the Certificate of Incorporation (the “Charter
Amendment”) with the Delaware Secretary of State to effect the Share Increase. In the event the
Company’s stockholders have not approved the Charter Amendment by the Amendment Date, the Company
shall pay to each Purchaser an amount, in cash, equal to the product of (i) the number of Warrant
Shares issuable upon exercise of the Warrants held by such Purchaser multiplied by (ii) the
purchase price per share of Common Stock, multiplied by two percent (2%) for each 30 day period (or
portion thereof) after the Amendment Date and prior to the approval of the Charter Amendment by the
Company’s stockholders.



5. TRANSFER AGENT INSTRUCTIONS.



(a) Upon conversion of the Preferred Stock or exercise of the Warrants by any person, (i) if
the DTC Transfer Conditions (as defined below) are satisfied, the Company shall cause its transfer
agent to electronically transmit all Conversion Shares and Warrant Shares by crediting the account
of such person or its nominee with the Depository Trust Company (“DTC”) through its Deposit
Withdrawal Agent Commission system; or (ii) if the DTC Transfer Conditions are not satisfied, the
Company shall issue and deliver, or instruct its transfer agent to issue and deliver, certificates
(subject to the legend and other applicable provisions hereof and the Certificate of Designation
and Warrants), registered in the name of such person its nominee, physical certificates
representing the Conversion Shares and Warrant Shares, as applicable. Even if the DTC Transfer
Conditions are satisfied, any person effecting a conversion of Preferred Stock or exercising
Warrants may instruct the Company to deliver to such person or its nominee physical certificates
representing the Conversion Shares and Warrant Shares, as applicable, in lieu of delivering such
shares by way of DTC Transfer. For purposes of this Agreement, “DTC Transfer Conditions” means that
(A) the Company’s transfer agent is participating in the DTC Fast Automated Securities Transfer
program and (B) the certificates for the Conversion Shares or Warrant Shares required to be
delivered do not bear a legend and the person effecting such conversion or exercise is not then
required to return such certificate for the placement of a legend thereon.



(b) The Company warrants that no instruction other than such instructions referred to in this
Section 5, and stop transfer instructions to give effect to Sections 2(f) and 2(g) hereof in the
case of the transfer of the Conversion Shares or Warrant Shares prior to registration of the
Conversion Shares and Warrant Shares under the Securities Act or without an exemption therefrom,
shall be given by the Company to its transfer agent and that the Securities shall otherwise be
freely transferable on the books and records of the Company as and to the extent provided in this
Agreement. Nothing in this Section 5(a) shall affect in any way the Purchasers’ obligations and
agreements set forth in Section 2(g) hereof to resell the Securities pursuant to an effective
registration statement or under an exemption from the registration requirements of applicable
securities law.



(c) If any Purchaser provides the Company and the transfer agent with an opinion of counsel,
which opinion of counsel shall be in form, substance and scope customary for opinions of counsel in
comparable transactions, to the effect that the Securities to be sold or transferred may be sold or
transferred pursuant to an exemption from registration, or any Purchaser provides the Company with
reasonable assurances that such Securities may be sold under Rule 144, the Company shall permit the
transfer and, in the case of the Conversion Shares and Warrant Shares, promptly instruct its
transfer agent to issue one or more certificates in such name and in such denominations as
specified by the Purchasers.



6. CONDITIONS TO THE COMPANY’S OBLIGATION TO SELL.



The obligation of the Company hereunder to issue and sell the Preferred Stock to each
Purchaser hereunder is subject to the satisfaction, at or before each Closing Date, of each of the
following conditions as to such Purchaser, provided that these conditions are for the Company’s
sole benefit and may be waived by the Company at any time in its sole discretion:



(a) Each Purchaser shall have executed such Purchaser’s Execution Page to this Agreement and
each other Transaction Document to which such Purchaser is a party and delivered the same to the
Company.



(b) Each Purchaser shall have delivered the full amount of such Purchaser’s Purchase



Price in accordance with Section 8 hereof.



(c) The representations and warranties of each Purchaser shall be true and correct as of the
date when made and as of the applicable Closing Date as though made at that time (except for
representations and warranties that speak as of a specific date, which representations and
warranties shall be true and correct as of such date), and such Purchaser shall have performed,
satisfied and complied in all material respects with the covenants, agreements and conditions
required by this Agreement to be performed, satisfied or complied with by such Purchaser at or
prior to the applicable Closing Date.



(d) The Company shall have delivered to such Purchaser a secretary’s certificate, dated as of
the Closing Date, as to (i) the Resolutions, (ii) the Certificate, (iii) the Bylaws, (iv) the
Certificate of Designation, each as in effect at the Closing, and (iv) the authority and incumbency
of the officers of the Company executing the Transaction Documents and any other documents required
to be executed or delivered in connection therewith.



(e) No statute, rule, regulation, executive order, decree, ruling, injunction, action or
proceeding shall have been enacted, entered, promulgated or endorsed by any court or governmental
authority of competent jurisdiction or any self-regulatory organization having authority over the
matters contemplated hereby which prohibits the consummation of any of the transactions
contemplated by this Agreement.



(f) At the Closing, the Purchasers shall have received an opinion of counsel to the Company,
dated the date of the Closing, in the form of Exhibit D hereto, and such other certificates
and documents as the Purchasers or its counsel shall reasonably require incident to the Closing.



(g) No action, suit or proceeding before any arbitrator or any governmental authority shall
have been commenced, and no investigation by any governmental authority shall have been threatened,
against the Company or any subsidiary, or any of the officers, directors or affiliates of the
Company or any subsidiary seeking to restrain, prevent or change the transactions contemplated by
this Agreement, or seeking damages in connection with such transactions.



7. CONDITIONS TO EACH PURCHASER’S OBLIGATION TO PURCHASE.



The obligation of each Purchaser hereunder (which obligations shall be several, and not joint)
to purchase the Preferred Stock for which it is subscribing from the Company hereunder is subject
to the satisfaction, at or before the Closing Date, of each of the following conditions, provided
that such conditions are for each Purchaser’s individual and sole benefit and may be waived by any
Purchaser as to such Purchaser at any time in such Purchaser’s sole discretion:



(a) The Company shall have executed such Purchaser’s Execution Page to this Agreement and each
other Transaction Document to which the Company is a party and delivered executed originals of the
same to such Purchaser.



(b) The Certificate of Designation shall have been filed and accepted for filing with the
Secretary of State of the State of Delaware and a copy thereof certified by the Secretary of State
of the State of Delaware shall have been delivered to such Purchaser.



(c) The Company shall have delivered to such Purchaser duly executed certificates representing
the Preferred Stock and Warrants for the number of shares being purchased by such Purchaser (each
in such denominations as such Purchaser shall request), registered in such Purchaser’s name.



(d) The Common Stock shall be authorized for quotation and listed on the Bulletin Board and
trading in the Common Stock (or on the Bulletin Board generally) shall not have been suspended by
the SEC or the Bulletin Board.



(e) The representations and warranties of the Company shall be true and correct as of the date
when made and as of the Closing Date as though made at that time (except for representations and
warranties that speak as of a specific date, which representations and warranties shall be true and
correct as of such date) and the Company shall have performed, satisfied and complied in all
material respects with the covenants, agreements and conditions required by this Agreement to be
performed, satisfied or complied with by the Company at or prior to the Closing Date. Such
Purchaser shall have received a certificate, executed by the Chief Executive Officer of the Company
after reasonable investigation, dated as of the Closing Date to the foregoing effect and as to such
other matters as may reasonably be requested by such Purchaser.



(f) No statute, rule, regulation, executive order, decree, ruling, injunction, action or
proceeding shall have been enacted, entered, promulgated or endorsed by any court or governmental
authority of competent jurisdiction or any self-regulatory organization having authority over the
matters contemplated hereby which questions the validity of, challenges or prohibits the
consummation of, any of the transactions contemplated by this Agreement.



(g) There shall have been no material adverse changes and no material adverse developments in
the business, properties, operations, prospects, financial condition or results of operations of
the Company and its Subsidiaries, taken as a whole, since the date hereof, and no information that
is materially adverse to the Company and of which such Purchaser is not currently aware shall come
to the attention of such Purchaser.



8. ESCROW PROVISIONS.



(a) Appointment of Escrow Agent. The Company and each Purchaser hereby jointly appoint
Escrow Agent as escrow agent to hold the Purchase Price deposited into escrow with it pursuant to
this Agreement (the “Escrow Deposit”), and Escrow Agent hereby agrees to hold the Escrow Deposit in
escrow in accordance with the terms hereof and to perform its other duties hereunder.



(b) Deposit of Escrow Deposit. On or before the date hereof, each Purchaser shall
transmit the Escrow Deposit to Escrow Agent by federal wire transfer of immediately available U.S.
funds. Subject to Section 8(d) hereof, and until all of the Escrow Deposit shall have been
disbursed as provided in this Agreement, Escrow Agent shall hold the Escrow Deposit in an
non-interest bearing account. Upon distribution to the Company, such income shall be treated as
income of the Company for income tax purposes. Whenever required by this Agreement to disburse any
of the Escrow Deposit, Escrow Agent shall liquidate sufficient investments to permit such
disbursement to be made.



(c) Disposition of Escrow Deposit. As soon as reasonably practicable following receipt
of written instructions from the Company and Burnham Hill Partners, a division of Pali Capital,
Inc., as placement agent for the Securities, along with duly executed and delivered copies of each
Purchaser’s Execution Page to this Agreement and each other Transaction Document to which such
Purchaser is a party, Escrow Agent shall, subject to payment of Escrow Agent’s expenses and fees
pursuant to Section 8(f) hereof and the fees of the placement agent, deliver the Escrow Deposit to
the Company by federal wire transfer of immediately available U.S. funds in accordance with wire
instructions provided by the Company, and, upon such deliveries, Escrow Agent shall be fully
discharged from any and all obligations hereunder. If written instructions regarding the
disposition of the Escrow Deposit and duly executed and delivered copies of each Purchaser’s
Execution Page to this Agreement and each other Transaction Document to which such Purchaser is a
party are not received by Escrow Agent within five (5) business days of the date hereof, the Escrow
Agent shall return the applicable portion of the Escrow Deposit to each Purchaser upon the request
of the Purchaser and, upon such delivery, Escrow Agent shall be fully discharged from any and all
obligations hereunder.



(d) Resignation or Removal of Escrow Agent. Escrow Agent may resign at any time upon
10 days’ prior notice to the Company and may be removed by the mutual consent of the Company and
each Purchaser upon 10 days’ prior notice to Escrow Agent. Prior to the effective date of the
resignation or removal of Escrow Agent or any successor escrow agent, the Company and the
Purchasers shall jointly appoint a successor escrow agent to hold the Escrow Deposit and any such
successor escrow agent shall execute and deliver to the predecessor escrow agent an instrument
accepting such appointment and the terms of this Agreement. Thereafter, upon receipt of the Escrow
Deposit from the predecessor agent, such successor agent shall, without further act, become vested
with all of the rights, powers and duties of the predecessor escrow agent as if originally named
herein, and such predecessor escrow agent shall be released from all obligations and liability
hereunder. If no successor escrow agent is appointed prior to the effective date of the termination
or resignation of the Escrow Agent, Escrow Agent may: (i) file an interpleader action in any court
of competent jurisdiction and deposit the Escrow Deposit with the clerk of such court, or (ii)
deliver the Escrow Deposit to a bank with capital in excess of $100 million which executes and
delivers to the predecessor escrow agent an instrument accepting such appointment and the terms of
this Agreement. Thereafter, upon receipt of the Escrow Deposit from the predecessor agent, such
successor agent shall, without further act, become vested with all of the rights, powers and duties
of the predecessor escrow agent as if originally named herein, and such predecessor escrow agent
shall be released from all obligations and liability hereunder.



(e) Liability of Escrow Agent.



(i) The duties of Escrow Agent hereunder are entirely administrative and not discretionary.
Escrow Agent is obligated to act only in accordance with this Agreement, is authorized hereby to
comply with any orders, judgments or decrees of any court or arbitration panel (whether or not any
appeal thereof is pending) and shall not incur any liability as a result of its compliance with
such instructions, orders, judgments or decrees. Escrow Agent may assume the due execution,
validity and effectiveness of, and the truth and accuracy of any information contained in, any
instrument or other document presented to it and shall not have any obligation to inquire into the
authenticity or authorization thereof.



(ii) Escrow Agent shall have no liability under, or duty to inquire into, the terms and
provisions of any other agreement between any of the parties hereto. If any of the terms and
provisions of any other agreement conflict or are inconsistent with any of the terms and provisions
of this Agreement, the terms and provisions of this Agreement in respect of Escrow Agent’s rights
and duties shall govern and control in all respects.



(iii) If Escrow Agent shall be uncertain as to its rights or duties hereunder, it shall be
entitled to refrain from taking any action other than to keep all property held in escrow pursuant
hereto until it shall be directed otherwise in a writing signed by the Company and each Purchaser
or by an order of a court of competent jurisdiction. Alternatively, in such situation, Escrow Agent
may in its sole discretion, deliver and interplead the Escrow Deposit, together with any interest
thereon, into a court of competent jurisdiction, and, upon such delivery and interpleading, Escrow
Agent shall be fully discharged from any and all obligations and liability hereunder. Escrow Agent
may consult with counsel of its choice, and shall not be liable for any action taken, suffered, or
omitted by it in accordance with the advice of such counsel. Escrow Agent shall not be required to
institute legal proceedings of any kind and shall not be required to defend any legal proceedings
which may be instituted against it in respect of the subject matter of this Agreement unless
requested to do so by another party hereto and indemnified to its satisfaction against the costs
and expenses of such defense.



(iv) The Company and each Purchaser hereby irrevocably waive and covenant not to bring any
suit, claim, demand or cause of action of any kind which any or all may have to assert against
Escrow Agent (or any partner or employee of Escrow Agent) arising out of or relating to the
execution or performance by Escrow Agent of this Agreement now or in the future, unless such suit,
claim, demand or cause of action is based upon the willful misconduct of Escrow Agent or Escrow
Agent’s gross negligence in its failure to perform an express obligation hereunder. Escrow Agent
shall be indemnified and held harmless against any and all liabilities, including judgments, costs
and reasonable counsel fees, for anything done or omitted by Escrow Agent in the performance of
this Escrow Agreement except as a result of its willful misconduct or gross negligence in its
failure to perform an express obligation hereunder. All such reimbursements and indemnifications
shall be the joint and several obligation of the Company and each Purchaser.



(f) Expenses of Escrow Agent. Escrow Agent’s expenses and fees shall be deducted from
any interest accrued on the Escrow Deposit prior to the distribution of such accrued interest to
the Company in accordance with this Section 8. Any expenses and fees of Escrow Agent in excess of
the accrued interest, up to a maximum of Five Thousand Dollars ($5,000) on the Escrow Deposit shall
be the responsibility of the Company and shall be paid promptly upon receipt of an invoice from
Escrow Agent.



9. FEES AND EXPENSES. 



Except as otherwise set forth in this Agreement, the Registration Rights Agreement or the
Certificate of Designation, each party shall pay the fees and expenses of its advisors, counsel,
accountants and other experts, if any, and all other expenses, incurred by such party incident to
the negotiation, preparation, execution, delivery and performance of this Agreement, provided that
the Company shall pay for attorneys’ fees and expenses (including disbursements and out-of-pocket
expenses) incurred by one legal firm designated by the Purchasers in connection with (i) the
preparation, negotiation, execution and delivery of this Agreement, the Certificate of Designation,
the Warrants, the Registration Rights Agreement and the transactions contemplated thereunder, which
payment shall be made at Closing, (ii) the filing and declaration of effectiveness by the SEC of
the Registration Statement (as defined in the Registration Rights Agreement) and (iii) any
amendments, modifications or waivers of this Agreement or any of the other Transaction Documents.
In addition, the Company shall pay all reasonable fees and expenses incurred by the Purchasers in
connection with the enforcement of this Agreement or any of the other Transaction Documents,
including, without limitation, all reasonable attorneys’ fees and expenses. The Company shall pay
all stamp or other similar taxes and duties levied in connection with issuance of the Preferred
Stock pursuant hereto.



11. MISCELLANEOUS.



(a) Governing Law. This Agreement shall be governed by and construed in accordance
with the internal laws of the State of New York, without giving effect to any of the conflicts of
law principles which would result in the application of the substantive law of another
jurisdiction. This Agreement shall not be interpreted or construed with any presumption against
the party causing this Agreement to be drafted.



(b) Jurisdiction. Each of the Company and the Purchasers (i) hereby irrevocably
submits to the jurisdiction of the United States District Court sitting in the Southern District of
New York and the courts of the State of New York located in New York county for the purposes of any
suit, action or proceeding arising out of or relating to this Agreement or any of the other
Transaction Documents or the transactions contemplated hereby or thereby and (ii) hereby waives,
and agrees not to assert in any such suit, action or proceeding, any claim that it is not
personally subject to the jurisdiction of such court, that the suit, action or proceeding is
brought in an inconvenient forum or that the venue of the suit, action or proceeding is improper.
Each of the Company and the Purchasers consents to process being served in any such suit, action or
proceeding by mailing a copy thereof to such party at the address in effect for notices to it under
this Agreement and agrees that such service shall constitute good and sufficient service of process
and notice thereof. Nothing in this Section 11(b) shall affect or limit any right to serve process
in any other manner permitted by law.



(c) Counterparts. This Agreement may be executed in two or more counterparts, all of
which shall be considered one and the same agreement and shall become effective when counterparts
have been signed by each party and delivered to the other party. This Agreement, once executed by a
party, may be delivered to the other parties hereto by facsimile transmission of a copy of this
Agreement bearing the signature of the party so delivering this Agreement. In the event any
signature is delivered by facsimile transmission, the party using such means of delivery shall
cause the manually executed execution page(s) hereof to be physically delivered to the other party
within five days of the execution hereof, provided that the failure to so deliver any manually
executed execution page shall not affect the validity or enforceability of this Agreement.



(d) Construction. Whenever the context requires, the gender of any word used in this
Agreement includes the masculine, feminine or neuter, and the number of any word includes the
singular or plural. Unless the context otherwise requires, all references to articles and sections
refer to articles and sections of this Agreement, and all references to schedules are to schedules
attached hereto, each of which is made a part hereof for all purposes. The descriptive headings of
the several articles and sections of this Agreement are inserted for purposes of reference only,
and shall not affect the meaning or construction of any of the provisions hereof.



(e) Severability. If any provision of this Agreement shall be invalid or unenforceable
in any jurisdiction, such invalidity or unenforceability shall not affect the validity or
enforceability of the remainder of this Agreement or the validity or enforceability of this
Agreement in any other jurisdiction.



(f) Entire Agreement; Amendments. This Agreement and the other Transaction Documents
(including any schedules and exhibits hereto and thereto) contain the entire understanding of the
Purchasers, the Company, their affiliates and persons acting on their behalf with respect to the
matters covered herein and therein and, except as specifically set forth herein or therein, neither
the Company nor the Purchasers make any representation, warranty, covenant or undertaking with
respect to such matters. No provision of this Agreement may be waived other than by an instrument
in writing signed by the party against whom enforcement of the waiver is sought, and no provision
of this Agreement may be amended other than by an instrument in writing signed by the Company and
each Purchaser. No consideration shall be paid to a Purchaser by the Company in connection with an
amendment hereto unless each Purchaser similarly affected by such amendment receives a pro rata
amount of consideration from the Company, and, unless a Purchaser agrees otherwise, each amendment
hereto shall similarly affect each Purchaser.



(g) Notices. Any notices required or permitted to be given under the terms of this
Agreement shall be sent by certified or registered mail (return receipt requested) or delivered
personally, by responsible overnight carrier or by confirmed facsimile, and shall be effective five
days after being placed in the mail, if mailed, or upon receipt or refusal of receipt, if delivered
personally or by responsible overnight carrier or confirmed facsimile, in each case addressed to a
party. The initial addresses for such communications shall be as follows, and each party shall
provide notice to the other parties of any change in such party’s address:




(i) If to the Company:




Wave Wireless Corporation



255 Consumers Road



Suite 500



Toronto, Ontario, Canada M2J IR4



Attention: Chief Financial Officer



Tel. No.: (416) 502-3203



Fax No.: (416) 502-2968




with a copy simultaneously transmitted by like means (which transmittal




shall not constitute notice hereunder) to:




Procopio, Cory, Hargreaves & Savitch LLP




530 B Street




Suite 2100




San Diego, CA 92101




Attention: John Lee, Esq.



(ii) If to any Purchasers, to the address set forth under such Purchaser’s name on the
Execution Page hereto executed by such Purchaser.




(iii) If to Escrow Agent:




Kramer Levin Naftalis & Frankel LLP


1177 Avenue of the Americas


New York, New York 10036


Attention: Christopher S. Auguste, Partner


Tel. No.: (212) 715-9100




Fax No.: (212) 715-8000



(h) Successors and Assigns. This Agreement shall be binding upon and inure to the
benefit of the parties and their successors and assigns. Except as provided herein, the Company
shall not assign this Agreement or any rights or obligations hereunder. Any Purchaser may assign or
transfer the Securities pursuant to the terms of this Agreement and of such Securities, or assign
such Purchaser’s rights hereunder or thereunder to any other person or entity, except for direct
competitors of the Company or persons or entities that have publicly announced plans to compete
directly with the Company. In addition, and notwithstanding anything to the contrary contained in
this Agreement or the other Transaction Documents, the Securities may be pledged and all rights of
any Purchaser under this Agreement or any other Transaction Document may be assigned, without
further consent of the Company, to a bona fide pledgee in connection with such Purchaser’s margin
or brokerage account.



(i) Third Party Beneficiaries. This Agreement is intended for the benefit of the
parties hereto and their respective permitted successors and assigns, and is not for the benefit
of, nor may any provision hereof be enforced by, any other person.



(j) Survival. The representations and warranties of the Company and the agreements and
covenants set forth in Sections 4(b), 4(c), 4(e), 4(g), 4(j), 4(k), 4(n), 4(p), 4(s), 4(v), 4(w)
and 5 hereof shall survive the Closing notwithstanding any due diligence investigation conducted by
or on behalf of any Purchaser. Moreover, none of the representations and warranties made by the
Company herein shall act as a waiver of any rights or remedies any Purchaser may have under
applicable U.S. federal or state securities laws.



(k) Waivers. No waiver by either party of any default with respect to any provision,
condition or requirement of this Agreement shall be deemed to be a continuing waiver in the future
or a waiver of any other provisions, condition or requirement hereof, nor shall any delay or
omission of any party to exercise any right hereunder in any manner impair the exercise of any
such right accruing to it thereafter.



(l) Headings. The article, section and subsection headings in this Agreement are for
convenience only and shall not constitute a part of this Agreement for any other purpose and shall
not be deemed to limit or affect any of the provisions hereof.



(m) Publicity. The Company and each Purchaser shall have the right to approve before
issuance any press releases, SEC or, to the extent applicable, NASD filings, or any other public
statements with respect to the transactions contemplated hereby; provided, however, that the
Company shall be entitled, without the prior approval of the Purchasers, to make any press release
or SEC or, to the extent applicable, NASD filings with respect to such transactions as is required
by applicable law and regulations (although the Purchasers shall be consulted by the Company in
connection with any such press release and filing prior to its release and shall be provided with a
copy thereof and must provide specific consent to the use of their name in connection therewith).



(n) Further Assurances. Each party shall do and perform, or cause to be done and
performed, all such further acts and things, and shall execute and deliver all such other
agreements, certificates, instruments and documents, as the other party may reasonably request in
order to carry out the intent and accomplish the purposes of this Agreement and the consummation of
the transactions contemplated hereby.



(o) Indemnification. In consideration of each Purchaser’s execution and delivery of
this Agreement and the other Transaction Documents and purchase of the Securities hereunder, and in
addition to all of the Company’s other obligations under this Agreement and the other Transaction
Documents, from and after the Closing, the Company shall defend, protect, indemnify and hold
harmless each Purchaser and each other holder of the Securities and all of their stockholders,
partners, members, officers, directors, employees and direct or indirect investors and any of the
foregoing persons’ agents or other representatives (including, without limitation, those retained
in connection with 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 connection therewith (irrespective
of whether any such Indemnitee is a party to the action for which indemnification hereunder is
sought), and including reasonable attorneys’ fees and disbursements (the “Indemnified
Liabilities”), incurred by any Indemnitee as a result of, or arising out of, or relating to (i) any
misrepresentation or breach of any representation or warranty made by the Company in this
Agreement, any other Transaction Document or any other certificate, instrument or document
contemplated hereby or thereby, (ii) any breach of any covenant, agreement or obligation of the
Company contained in this Agreement, any other Transaction Document or any other certificate,
instrument or document contemplated hereby or thereby or (iii) any cause of action, suit or claim
brought or made against such Indemnitee by a third party (including for these purposes a derivative
action brought on behalf of the Company) and arising out of or resulting from (A) the execution,
delivery, performance or enforcement of this Agreement, any other Transaction Document or any other
certificate, instrument or document contemplated hereby or thereby, (B) any transaction financed or
to be financed in whole or in part, directly or indirectly, with the proceeds of the issuance and
sale of the Securities, (C) any disclosure made by such Purchaser pursuant to Section 4(b) or 4(o)
hereof, or (D) the status of such Purchaser or holder of the Securities as an investor in the
Company. To the extent that the foregoing undertaking by the Company may be unenforceable for any
reason, the Company shall make the maximum contribution to the payment and satisfaction of each of
the Indemnified Liabilities which is permissible under applicable law.



(p) Indemnification Procedure. Any party entitled to indemnification under this
Article VI (an “indemnified party”) will give written notice to the indemnifying party of any
matters giving rise to a claim for indemnification; provided, that the failure of any party
entitled to indemnification hereunder to give notice as provided herein shall not relieve the
indemnifying party of its obligations under this Article VI except to the extent that the
indemnifying party is actually prejudiced by such failure to give notice. In case any action,
proceeding or claim is brought against an indemnified party in respect of which indemnification is
sought hereunder, the indemnifying party shall be entitled to participate in and, unless in the
reasonable judgment of the indemnified party a conflict of interest between it and the indemnifying
party may exist with respect of such action, proceeding or claim, to assume the defense thereof
with counsel reasonably satisfactory to the indemnified party. In the event that the indemnifying
party advises an indemnified party that it will contest such a claim for indemnification hereunder,
or fails, within thirty (30) days of receipt of any indemnification notice to notify, in writing,
such person of its election to defend, settle or compromise, at its sole cost and expense, any
action, proceeding or claim (or discontinues its defense at any time after it commences such
defense), then the indemnified party may, at its option, defend, settle or otherwise compromise or
pay such action or claim. In any event, unless and until the indemnifying party elects in writing
to assume and does so assume the defense of any such claim, proceeding or action, the indemnified
party’s costs and expenses arising out of the defense, settlement or compromise of any such action,
claim or proceeding shall be losses subject to indemnification hereunder. The indemnified party
shall cooperate fully with the indemnifying party in connection with any negotiation or defense of
any such action or claim by the indemnifying party and shall furnish to the indemnifying party all
information reasonably available to the indemnified party which relates to such action or claim.
The indemnifying party shall keep the indemnified party fully apprised at all times as to the
status of the defense or any settlement negotiations with respect thereto. If the indemnifying
party elects to defend any such action or claim, then the indemnified party shall be entitled to
participate in such defense with counsel of its choice at its sole cost and expense. The
indemnifying party shall not be liable for any settlement of any action, claim or proceeding
effected without its prior written consent. Notwithstanding anything in this Article VI to the
contrary, the indemnifying party shall not, without the indemnified party’s prior written consent,
settle or compromise any claim or consent to entry of any judgment in respect thereof which imposes
any future obligation on the indemnified party or which does not include, as an unconditional term
thereof, the giving by the claimant or the plaintiff to the indemnified party of a release from all
liability in respect of such claim. The indemnification required by this Article VI shall be made
by periodic payments of the amount thereof during the course of investigation or defense, as and
when bills are received or expense, loss, damage or liability is incurred, so long as the
indemnified party irrevocably agrees to refund such moneys if it is ultimately determined by a
court of competent jurisdiction that such party was not entitled to indemnification. The indemnity
agreements contained herein shall be in addition to (a) any cause of action or similar rights of
the indemnified party against the indemnifying party or others, and (b) any liabilities the
indemnifying party may be subject to pursuant to the law.



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



(r) Joint Participation in Drafting. Each party to this Agreement has participated in
the negotiation and drafting of this Agreement and the other Transaction Documents. As such, the
language used herein and therein shall be deemed to be the language chosen by the parties hereto to
express their mutual intent, and no rule of strict construction will be applied against any party
to this Agreement.



(s) Equitable Relief. The Company acknowledges that a breach by it of its obligations
hereunder will cause irreparable harm to the Purchasers by vitiating the intent and purpose of the
transactions contemplated hereby. Accordingly, the Company acknowledges that the remedy at law for
a breach of its obligations hereunder (including, but not limited to, its obligations pursuant to
Section 5 hereof) will be inadequate and agrees, in the event of a breach or threatened breach by
the Company of the provisions of this Agreement (including, but not limited to, its obligations
pursuant to Section 5 hereof), that each Purchaser shall be entitled, in addition to all other
available remedies, to an injunction restraining any breach and requiring immediate issuance and
transfer of the Securities, without the necessity of showing economic loss and without any bond or
other security being required.



(t) Knowledge. As used in this Agreement, the term “knowledge” of any person or entity
shall mean and include (i) actual knowledge of any of the Company’s officers or directors and (ii)
that knowledge which a reasonably prudent business person could have obtained in the management of
his or her business affairs after making due inquiry and exercising due diligence which a prudent
business person should have made or exercised, as applicable, with respect thereto.



(u) Exculpation Among Purchasers. The Company acknowledges that the obligations of
each Purchaser under this Agreement and each of the other Transaction Documents are several and not
joint with the obligations of any other Purchaser, and no Purchaser shall be responsible in any way
for the performance of the obligations of any other Purchaser under the Transaction Documents. Each
Purchaser acknowledges that it has independently evaluated the merits of the transactions
contemplated by this Agreement and the other Transaction Documents, that it has independently
determined to enter into the transactions contemplated hereby and thereby, that it is not relying
on any advice from or evaluation by any other Purchaser, and that it is not acting in concert with
any other Purchaser in making its purchase of securities hereunder or in monitoring its investment
in the Company. The Purchasers and, to its knowledge, the Company agree that the no action taken by
any Purchaser pursuant hereto or to the other Transaction Documents, shall be deemed to constitute
the Purchasers as a partnership, an association, a joint venture or any other kind of entity, or
create a presumption that the Purchasers are in any way acting in concert or would deem such
Purchasers to be members of a “group” for purposes of Section 13(d) of the Exchange Act, and the
Purchasers have not agreed to act together for the purpose of acquiring, holding, voting or
disposing of equity securities of the Company. The Company has elected to provide all Purchasers
with the same terms and Transaction Documents for the convenience of the Company and not because it
was required or requested to do so by the Purchasers. The Company acknowledges that such procedure
with respect to the Transaction Documents in no way creates a presumption that the Purchasers are
in any way acting in concert or as a “group” for purposes of Section 13(d) of the Exchange Act with
respect to the Transaction Documents or the transactions contemplated hereby or thereby. Each
Purchaser acknowledges that it has been represented by its own separate legal counsel in their
review and negotiation of the Transaction Documents.



(v) Business Days and Trading Days. For purposes of this Agreement, the term “business
day” means any day other than a Saturday or Sunday or a day on which banking institutions in the
State of New York are authorized or obligated by law, regulation or executive order to close, and
the term “trading day” means any day on which the Bulletin Board or, if the Common Stock is not
then traded on the Bulletin Board, the principal national securities exchange, automated quotation
system or other trading market where the Common Stock is then listed, quoted or traded, is open for
trading.



[REMAINDER OF PAGE LEFT BLANK INTENTIONALLY]

1


IN WITNESS WHEREOF, the undersigned
Purchaser and the Company have caused this



Agreement to be duly executed as of the date first above written.



WAVE WIRELESS CORPORATION



By:      

Name:

Title:





PURCHASER:



     


(Print or Type Name of Purchaser)



By:      

Name:

Title:





RESIDENCE:      



ADDRESS:      



     



     



Telephone:      



Facsimile:      




Attention:      



AGGREGATE SUBSCRIPTION AMOUNT:



Number of Preferred Stock:      


Warrants to Purchase      Shares of Common Stock


Purchase Price ($7,500 per share of Preferred Stock):      



ESCROW AGENT:



KRAMER LEVIN NAFTALIS & FRANKEL LLP



By:      


Name:


Title:



2




[SIGNATURE PAGE TO SECURITIES PURCHASE AGREEMENT]EXHIBIT A




3




CERTIFICATE OF DESIGNATIONEXHIBIT B




4




FORM OF WARRANT

EXHIBIT C




5




FORM OF REGISTRATION RIGHTS AGREEMENT

EXHIBIT D




FORM OF OPINION OF COUNSEL




1. The Company is a corporation duly incorporated, validly existing and in good standing
under the laws of the State of Delaware and has the requisite corporate power to own, lease and
operate its properties and assets, and to carry on its business as presently conducted. The
Company is duly qualified as a foreign corporation to do business and is in good standing in every
jurisdiction in which the nature of the business conducted or property owned by it makes such
qualification necessary.



2. The Company has the requisite corporate power and authority to enter into and perform its
obligations under the Transaction Documents and to issue the Preferred Stock, the Warrants and the
Common Stock issuable upon conversion of the Preferred Stock and exercise of the Warrants. The
execution, delivery and performance of each of the Transaction Documents by the Company and the
consummation by it of the transactions contemplated thereby have been duly and validly authorized
by all necessary corporate action and no further consent or authorization of the Company or its
Board of Directors or stockholders is required. Each of the Transaction Documents have been duly
executed and delivered, and the Preferred Stock and the Warrants have been duly executed, issued
and delivered by the Company and each of the Transaction Documents constitutes a legal, valid and
binding obligation of the Company enforceable against the Company in accordance with its respective
terms. The Common Stock issuable upon conversion of the Preferred Stock and exercise of the
Warrants are not subject to any preemptive rights under the Certificate of Incorporation or the
Bylaws.



3. The Preferred Stock and the Warrants have been duly authorized and, when delivered against
payment in full as provided in the Purchase Agreement, will be validly issued, fully paid and
nonassessable. The shares of Common Stock issuable upon conversion of the Preferred Stock and
exercise of the Warrants, have been duly authorized and reserved for issuance, and, when delivered
upon conversion or against payment in full as provided in the Certificate of Designation and the
Warrants, as applicable, will be validly issued, fully paid and nonassessable.



4. The execution, delivery and performance of and compliance with the terms of the Transaction
Documents and the issuance of the Preferred Stock, the Warrants and the Common Stock issuable upon
conversion of the Preferred Stock and exercise of the Warrants do not (i) violate any provision of
the Certificate of Incorporation or Bylaws, (ii) conflict with, or constitute a default (or an
event which with notice or lapse of time or both would become a default) under, or give to others
any rights of termination, amendment, acceleration or cancellation of, any material agreement,
mortgage, deed of trust, indenture, note, bond, license, lease agreement, instrument or obligation
to which the Company is a party, (iii) create or impose a lien, charge or encumbrance on any
property of the Company under any agreement or any commitment to which the Company is a party or by
which the Company is bound or by which any of its respective properties or assets are bound, or
(iv) result in a violation of any federal, state, local or foreign statute, rule, regulation,
order, judgment, injunction or decree (including Federal and state securities laws and regulations)
applicable to the Company or by which any property or asset of the Company is bound or affected,
except, in all cases other than violations pursuant to clause (i) above, for such conflicts,
default, terminations, amendments, acceleration, cancellations and violations as would not,
individually or in the aggregate, have a Material Adverse Effect.



5. No consent, approval or authorization of or designation, declaration or filing with any
governmental authority on the part of the Company is required under Federal, state or local law,
rule or regulation in connection with the valid execution and delivery of the Transaction
Documents, or the offer, sale or issuance of the Preferred Stock, the Warrants or the Common Stock
issuable upon conversion of the Preferred Stock and exercise of the Warrants other than the
Certificate of Designation and the Registration Statement.



6. There is no action, suit, claim, investigation or proceeding pending or threatened against
the Company which questions the validity of this Agreement or the transactions contemplated hereby
or any action taken or to be taken pursuant hereto or thereto. There is no action, suit, claim,
investigation or proceeding pending, or to our knowledge, threatened, against or involving the
Company or any of its properties or assets and which, if adversely determined, is reasonably likely
to result in a Material Adverse Effect. There are no outstanding orders, judgments, injunctions,
awards or decrees of any court, arbitrator or governmental or regulatory body against the Company
or any officers or directors of the Company in their capacities as such.



7. The offer, issuance and sale of the Preferred Stock and the Warrants and the offer,
issuance and sale of the shares of Common Stock issuable upon conversion of the Preferred Stock and
exercise of the Warrants pursuant to the Purchase Agreement, the Certificate of Designation and the
Warrants, as applicable, are exempt from the registration requirements of the Securities Act.



8. The Company is not, and as a result of and immediately upon Closing will not be, an
“investment company” or a company “controlled” by an “investment company,” within the meaning of
the Investment Company Act of 1940, as amended.



Very truly yours,





6