Unassociated Document


    Exhibit 4.1

     

     

    NOTE
AND WARRANT PURCHASE AGREEMENT

    


    Dated
as of May 21, 2009

    


    among

    


    JUMA
TECHNOLOGY CORP.

    


    and

    


    THE
PURCHASERS LISTED ON EXHIBIT A


    
      
         


      

      
         


        
          

        

      

      
         


      

    


    
      
        	
                TABLE OF
CONTENTS

              


      

    

    


    
      
        
          	 
      	
                  Page

                
	
                  ARTICLE
      I   Purchase and Sale of the Notes and
    Warrants

                	 
      
	
                  Section
      1.1

                	
                  Purchase
      and Sale of Notes

                	
                  1

                
	
                  Section
      1.2

                	
                  Warrants

                	
                  1

                
	
                  Section
      1.3

                	
                  Conversion
      Shares

                	
                  2

                
	
                  Section
      1.4

                	
                  Purchase
      Price and Closing

                	
                  2

                
	 
      	 
      	 
      
	
                  ARTICLE
      II  Representations and Warranties

                	 
      
	
                  Section
      2.1

                	
                  Representations
      and Warranties of the Company

                	
                  2

                
	
                  Section
      2.2

                	
                  Representations
      and Warranties of the Purchasers

                	
                  13

                
	 
      	 
      
	
                  ARTICLE
      III  Covenants

                	 
      
	
                  Section
      3.1

                	
                  Securities
      Compliance

                	
                  15

                
	
                  Section
      3.2

                	
                  Registration
      and Listing

                	
                  15

                
	
                  Section
      3.3

                	
                  Inspection
      Rights

                	
                  15

                
	
                  Section
      3.4

                	
                  Compliance
      with Laws

                	
                  16

                
	
                  Section
      3.5

                	
                  Keeping
      of Records and Books of Account

                	
                  16

                
	
                  Section
      3.6

                	
                  Furnishing
      of Information

                	
                  16

                
	
                  Section
      3.7

                	
                  Reporting
      Requirements

                	
                  16

                
	
                  Section
      3.8

                	
                  Amendments

                	
                  16

                
	
                  Section
      3.9

                	
                  Other
      Agreements

                	
                  17

                
	
                  Section
      3.10

                	
                  Distributions

                	
                  17

                
	
                  Section
      3.11

                	
                  Use
      of Proceeds

                	
                  17

                
	
                  Section
      3.12

                	
                  Reservation
      of Shares

                	
                  17

                
	
                  Section
      3.13

                	
                  Transfer
      Agent Instructions

                	
                  17

                
	
                  Section
      3.14

                	
                  Disposition
      of Assets

                	
                  18

                
	
                  Section
      3.15

                	
                  Reporting
      Status

                	
                  18

                
	
                  Section
      3.16

                	
                  Disclosure
      of Transaction

                	
                  18

                
	
                  Section
      3.17

                	
                  Disclosure
      of Material Information

                	
                  18

                
	
                  Section
      3.18

                	
                  Pledge
      of Securities

                	
                  18

                
	
                  Section
      3.19

                	
                  Form
      S-1 Eligibility

                	
                  19

                
	
                  Section
      3.20

                	
                  DTC

                	
                  19

                
	
                  Section
      3.21

                	
                  Issuance
      of Variable Securities

                	
                  19

                
	
                  Section
      3.22

                	
                  Approval
      of Acquisitions.

                	
                  19

                
	
                  Section
      3.23

                	
                  Most
      Favored Nations

                	
                  19

                


        

      

    

     

    
      
        
        

      

      
        i

        
          

        

      

      
        
        

      

    

     

    
      
        
          	
                  ARTICLE
      IV  Conditions

                	 
      
	
                  Section
      4.1

                	
                  Conditions
      Precedent to the Obligation of the Company to Sell the
    Shares

                	
                  19

                
	
                  Section
      4.2

                	
                  Conditions
      Precedent to the Obligation of the Purchasers to Purchase the
      Shares

                	
                  20

                
	 
      	 
      
	
                  ARTICLE
      V  Stock Certificate Legend

                	 
      
	
                  Section
      5.1

                	
                  Legend

                	
                  22

                
	 
      	 
      
	
                  ARTICLE
      VI  Indemnification

                	 
      
	
                  Section
      6.1

                	
                  General
      Indemnity

                	
                  23

                
	
                  Section
      6.2

                	
                  Indemnification
      Procedure

                	
                  23

                
	 
      	 
      
	
                  ARTICLE
      VII  Registration Rights

                	 
      
	
                  Section
      7.1

                	
                  Piggyback
      Registration Rights

                	
                  24

                
	
                  Section
      7.2

                	
                  Assignment
      of Registration Rights

                	
                  25

                
	
                  Section
      7.3

                	
                  Underwriter
      Status

                	
                  25

                
	 
      
	
                  ARTICLE
      VIII  Miscellaneous

                
	
                  Section 8.1

                	
                  Fees
      and Expenses

                	
                  25

                
	
                  Section
      8.2

                	
                  Specific
      Enforcement

                	
                  26

                
	
                  Section
      8.3

                	
                  Entire
      Agreement; Amendment

                	
                  26

                
	
                  Section
      8.4

                	
                  Rescission
      and Withdrawal Right

                	
                  26

                
	
                  Section
      8.5

                	
                  Notices

                	
                  27

                
	
                  Section
      8.6

                	
                  Waivers

                	
                  27

                
	
                  Section
      8.7

                	
                  Headings

                	
                  27

                
	
                  Section
      8.8

                	
                  Successors
      and Assigns

                	
                  28

                
	
                  Section
      8.9

                	
                  No
      Third Party Beneficiaries

                	
                  28

                
	
                  Section
      8.10

                	
                  Governing
      Law; Consent to Jurisdiction

                	
                  28

                
	
                  Section
      8.11

                	
                  Survival

                	
                  28

                
	
                  Section
      8.12

                	
                  Counterparts

                	
                  28

                
	
                  Section
      8.13

                	
                  Publicity

                	
                  28

                
	
                  Section
      8.14

                	
                  Severability

                	
                  28

                
	
                  Section
      8.15

                	
                  Further
      Assurances

                	
                  29

                


        

      

    


    
      
         


      

      
        ii

        
          

        

      

      
         


      

    

    


    
      
        
          
            	
                    EXHIBITS

                  
	 
      
	
                    Exhibit
      A

                  	
                    List
      of Purchasers

                  
	
                    Exhibit
      B

                  	
                    Form
      of 10% Convertible Bridge Note

                  
	
                    Exhibit
      C

                  	
                    Series
      A Warrant

                  
	
                    Exhibit
      D

                  	
                    Irrevocable
      Transfer Agent Instructions

                  
	
                    Exhibit
      E

                  	
                    Opinion
      of Counsel

                  


          

        

      

    


    
      
         


      

      
        iii

        
          

        

      

      
         


      

    


    NOTE
AND WARRANT PURCHASE AGREEMENT

    


    This NOTE
AND WARRANT PURCHASE AGREEMENT (this “Agreement”)
is dated as of May 21, 2009 by and among Juma Technology Corp., a Delaware
corporation (the “Company”),
and each of the Purchasers whose names are set forth on Exhibit
A hereto (individually, a “Purchaser”
and collectively, the “Purchasers”).

    


    WHEREAS, the Purchasers hold
10% convertible bridge
notes dated February 9, 2009 in the outstanding principal amount of
$1,500,000 (the “Existing
Notes”);

    


    WHEREAS, the investment by the
Purchasers pursuant to this Agreement constitutes a Qualified Financing as
defined in the Existing Notes; and

    


    WHEREAS, pursuant to the
Existing Notes, the Purchasers desire to surrender their Existing Notes for
cancellation in exchange for the issuance by the Company to the Purchasers of
Notes (as such term is defined in Section 1.1)
in accordance with the terms and conditions set forth in this Agreement and in
the amounts listed on Exhibit
A hereto.

    


    NOW, THEREFORE, in
consideration of the covenants, promises and representations set forth herein,
and for other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties agree as follows:

    


    ARTICLE
I

    Purchase
and Sale of Notes and Warrants

    


    Section
1.1       Purchase and Sale of
Notes.
Upon the following terms and conditions, (a) the Company and one of its
subsidiaries, Nectar Services Corp., a Delaware Corporation (“Nectar”
and together with the Company, the “Issuers”)
shall jointly issue and sell to the Purchasers and each of the Purchasers shall
purchase from the Company, 10% convertible bridge notes in the aggregate
principal amount of three million dollars ($3,000,000) and (b) the Purchasers
shall surrender for cancellation the Existing Notes in exchange for 10%
convertible bridge notes in the aggregate principal amount of one million five
hundred forty two thousand five hundred dollars ($1,542,500) (the notes referred
to in the foregoing clauses (a) and (b), the “Notes”).
The Notes provide for (i) optional conversion into shares of the Company’s
common stock, par value $0.0001 per share (the “Common
Stock”) and (ii) mandatory conversion upon the occurrence of a Qualified
Financing (as defined in the Notes). The Notes shall be substantially in the
form attached hereto as Exhibit
B.  The
Company and the Purchasers are executing and delivering this Agreement in
accordance with and in reliance upon the exemption from securities registration
afforded by Rule 506 of Regulation D (“Regulation
D”) as promulgated by the United States Securities and Exchange
Commission (the “Commission”)
under the Securities Act of 1933, as amended (the “Securities
Act”) or Section 4(2) of the Securities Act.

    


    Section
1.2        Warrants. Upon the
following terms and conditions and for no additional consideration, each of the
Purchasers shall be issued Series A Warrants, in substantially the form attached
hereto as Exhibit
C (the “Series A
Warrants”
and/or the “Warrants”)
to purchase up to fifty percent (50%) of that number of shares of the Company’s
Common Stock into which the Note issued to the applicable Purchaser originally
converts.  Any shares of Common Stock issuable upon exercise of the
Warrants (and such shares when issued) are herein referred to as the “Warrant
Shares.” The Warrants shall expire five (5) years following the Closing
Date and shall have an initial exercise price equal to fifteen cents ($0.15) per
share.

     

    
      
        
        

      

      
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    Section 1.3  
    Conversion Shares. The Company
has authorized and will reserve and covenants to continue to reserve, free of
preemptive rights and other similar contractual rights of stockholders, (i) such
number of shares of Common Stock equal to one hundred twenty percent (120%)
of the number of shares of Common Stock as shall from time to time be sufficient
to effect an Optional Conversion (as defined in the Notes) of all of the
Notes, and (ii) as of the date hereof, such number of shares of Common Stock
equal to one hundred twenty percent (120%) of the number of shares of Common
Stock as shall from time to time be sufficient to effect the exercise of the
Warrants then outstanding. Any shares of Common Stock issuable upon a conversion
of the Note (and such shares when issued) are herein referred to as the “Conversion
Shares.” The Notes, the Warrants, the Conversion Shares and the Warrant
Shares are sometimes collectively referred to as the “Securities.”

    


    Section 1.4    
  Purchase
Price and Closing. Subject to the terms and conditions hereof, the
Issuers agree to issue and sell to the Purchasers and, in consideration of and
in express reliance upon the representations, warranties, covenants, terms and
conditions of this Agreement, the Purchasers, severally but not jointly, agree
to purchase the Notes and the Warrants for an aggregate purchase price of three
million dollars ($3,000,000) (the “Purchase
Price”) and the cancellation of the Existing Notes. The closing under
this Agreement (the “Closing”)
shall take place on or about May 21, 2009 (the “Closing
Date”).  The Closing under this Agreement shall take place at
the offices of Sadis & Goldberg LLP, 551 Fifth Avenue, 21st Floor,
New York, New York 10176 at 10:00 a.m., New York time; provided, that all of the
conditions set forth in Article
IV hereof and applicable to the Closing shall have been fulfilled or
waived in accordance herewith.  Subject to the terms and conditions of
this Agreement, at the Closing the Company shall deliver or cause to be
delivered to each Purchaser (x) its Notes for the principal amount set forth
opposite the name of such Purchaser on Exhibit
A hereto, (y) its Warrants to purchase such number of shares of Common
Stock as is set forth opposite the name of such Purchaser on Exhibit
A attached hereto and (z) any other documents required to be
delivered pursuant to Article
IV hereof. At the Closing, each Purchaser shall deliver the applicable
Purchase Price by wire transfer to the Company and surrender of the applicable
Existing Notes to the Company.  In addition, the parties acknowledge
that no more than twenty-five thousand ($25,000) dollars of the Purchase Price
funded on the Closing Date shall be deducted by the Purchase Price from the
total amount otherwise payable to the Company, and paid over to counsel for the
Purchasers in payment of reasonable legal fees and out of pocket expenses of the
Purchasers’ counsel.

    


    ARTICLE
II

    Representations
and Warranties

    


    Section 2.1   
   Representations and
Warranties of the Company. Each of the Issuers hereby represents and
warrants to the Purchasers, as of the date hereof and as of the Closing Date
(except as set forth on the Schedule of Exceptions attached hereto with each
numbered Schedule corresponding to the section number herein), as follows
(unless otherwise specifically stated herein this Section
2.1 to the contrary, all references to the Company shall be deemed to
refer collectively to the Issuers):

    


    (a)       Organization, Good Standing
and Power. 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 conduct its business as it is now being conducted. Nectar 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 conduct its business as it is
now being conducted. Except as set forth in Schedule
2.1(g) hereto, the Company does not have any Subsidiaries. Except as set
forth on Schedule
2.1(a), each of the Company and each such Subsidiary 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 except for any jurisdiction(s) (alone or
in the aggregate) in which the failure to be so qualified will not have a
Material Adverse Effect (as defined in Section
2.1(c) hereof) on the Company’s financial condition.

     

    
      
        
        

      

      
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    (b)     Authorization;
Enforcement. The Company has the requisite corporate power and authority
to enter into and perform this Agreement, the Notes, the Warrants and the
Irrevocable Transfer Agent Instructions (as defined in Section
3.13) substantially
in the form of Exhibit
D attached hereto (collectively, the “Transaction
Documents”) and to issue and sell the Securities in accordance with the
terms hereof. The execution, delivery and performance of the Transaction
Documents by the Company and the consummation by it of the transactions
contemplated hereby and thereby have been duly and validly authorized by all
necessary corporate action, and except as set forth on Schedule
2.1(b), no further consent or authorization of the Company or its board
of directors or stockholders is required. This Agreement has been duly executed
and delivered by the Company. The other Transaction Documents will have been
duly executed and delivered by the Company at the Closing. Each of the
Transaction Documents constitutes, or shall constitute when executed and
delivered, a valid and binding obligation of the Company enforceable against the
Company in accordance with its terms, except as such enforceability may be
limited by applicable bankruptcy, insolvency, reorganization, moratorium,
liquidation, conservatorship, receivership or similar laws relating to, or
affecting generally the enforcement of, creditor’s rights and remedies or by
other equitable principles of general application.

    


    (c)     Capitalization. The
authorized capital stock of the Company and the shares thereof currently issued
and outstanding as of the date hereof are set forth on Schedule
2.1(c) hereto. All of the outstanding shares of capital stock have been
duly and validly authorized and issued in compliance with all securities
laws.  Except as set forth on Schedule
2.1(c) hereto, no shares of Common Stock are entitled to preemptive
rights or registration rights and there are no outstanding options, warrants,
scrip, rights to subscribe to, call or commitments of any character whatsoever
relating to, or securities or rights convertible into, any shares of capital
stock of the Company. There are no contracts, commitments, understandings, or
arrangements by which the Company is or may become bound to issue additional
shares of the capital stock of the Company or options, securities or rights
convertible into shares of capital stock of the Company. Except as set forth on
Schedule
2.1(c) hereto, the Company is not a party to any agreement granting
registration or anti-dilution rights to any person with respect to any of its
equity or debt securities. The Company is not a party to, and it has no
knowledge of, any agreement restricting the voting or transfer of any shares of
the capital stock of the Company. The offer and sale of all capital stock,
convertible securities, rights, warrants, or options of the Company issued 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. 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 “Certificate”) and
the Company’s Bylaws as in effect on the date hereof (the “Bylaws”).
For the purposes of this Agreement, “Material
Adverse Effect” means any material adverse effect on the business,
operations, properties, prospects, or financial condition of the Company and its
Subsidiaries, taken as a whole, and/or any condition, circumstance, or situation
that would prohibit or otherwise materially interfere with the ability of the
Company to perform any of its obligations under this Agreement.

    


    (d)     Issuance of Securities. The Notes
and the Warrants to be issued at the Closing have been duly authorized by all
necessary corporate action and when paid for or issued in accordance with the
terms hereof, the Notes and Warrants shall be validly issued and outstanding,
free and clear of all liens, encumbrances and rights of refusal of any
kind.  When the Conversion Shares and the Warrant Shares are issued in
accordance with the terms of this Agreement, the Notes and the Warrants, such
shares will be duly authorized by all necessary corporate action and validly
issued and outstanding, fully paid and nonassessable, free and clear of all
liens, encumbrances and rights of refusal of any kind and the holders shall be
entitled to all rights accorded to a holder of Common Stock.

     

    
      
        
        

      

      
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    (e)     No Conflicts. The
execution, delivery and performance of the Transaction Documents by the Company,
the performance by the Company of its obligations under the Notes and/or the
Warrants and the consummation by the Company of the transactions contemplated
herein and therein do not and will not (i) violate any provision of the
Company’s Certificate 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 agreement, mortgage, deed of trust, indenture, note, bond,
license, lease agreement, instrument or obligation to which the Company is a
party or by which it or its properties or assets are bound, except for conflicts
or defaults, which singularly or in the aggregate do not and will not have a
Material Adverse Effect, (iii) create or impose a lien, mortgage, security
interest, charge or encumbrance of any nature 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, except for liens, mortgages, security interests, charges or
encumbrances which singularly or in the aggregate do not and will not have a
Material Adverse Effect, or (iv) result in a violation of any federal, state,
local or foreign statute, rule, regulation, order, judgment or decree (including
Federal and state securities laws and regulations) applicable to the Company or
any of its Subsidiaries or by which any property or asset of the Company or any
of its Subsidiaries are bound or affected, except for violations, which
singularly or in the aggregate, do not and will not have a Material Adverse
Effect. The business of the Company and its Subsidiaries is not being conducted
in violation of any laws, ordinances or regulations of any governmental entity,
except for possible violations which singularly or in the aggregate do not and
will not have a Material Adverse Effect. The Company is not required under
Federal, state or local law, rule or regulation to obtain any consent,
authorization or order of, or make any filing or registration with, any court or
governmental agency in order for it to execute, deliver or perform any of its
obligations under the Transaction Documents, or issue and sell the Notes, the
Warrants, the Conversion Shares and the Warrant Shares in accordance with the
terms hereof or thereof (other than (x) any consent, authorization or order that
has been obtained as of the date hereof, (y) any filing or registration that has
been made as of the date hereof or (z) any filings which may be required to be
made by the Company with the Commission or state securities administrators
subsequent to the Closing, any registration statement which may be filed
pursuant hereto or any other Transaction Document); provided, that for purposes
of the representation made in this sentence, the Company is assuming and relying
upon the accuracy of the relevant representations and agreements of the
Purchasers herein.

    


    (f)      Commission Documents,
Financial Statements. The Company has timely filed all reports,
schedules, forms, statements and other documents required to be filed by it with
the Commission pursuant to the reporting requirements of the Securities Exchange
Act of 1934, as amended the (“Exchange
Act”), including material filed pursuant to Section 13(a) or 15(d) of the
Exchange Act (all of the foregoing including filings incorporated by reference
therein being referred to herein as the “Commission
Documents”). The Company has delivered or made available via EDGAR or
another Internet web-site to each of the Purchasers true and complete copies of
the Commission Documents. Except for any information provided to Robert Thomson,
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. At the times of their respective filings, the
Commission Documents complied in all material respects with the requirements of
the Exchange Act and the rules and regulations of the Commission promulgated
thereunder and other federal, state and local laws, rules and regulations
applicable to such documents, and, as of their respective dates, none of the
Commission Documents 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. The financial statements of the Company included
in the Commission Documents comply as to form in all material respects with
applicable accounting requirements and the published rules and regulations of
the Commission or other applicable rules and regulations with respect thereto.
Such financial statements have been prepared in accordance with U.S. generally
accepted accounting principles (“GAAP”)
applied on a consistent basis during the periods involved (except (i) as may be
otherwise indicated in such financial statements or the notes thereto or (ii) 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 financial position of the Company and its Subsidiaries as
of the dates thereof and the results of operations and cash flows for the
periods then ended (subject, in the case of unaudited statements, to normal
year-end audit adjustments).

     

    
      
        
        

      

      
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    (g)     Subsidiaries. Schedule
2.1(g) hereto sets forth each Subsidiary of the Company, showing the
jurisdiction of its incorporation or organization and showing the percentage of
each person’s ownership. Each Subsidiary is a corporation duly incorporated,
validly existing and in good standing under the laws of its state of
incorporation and has the requisite corporate power to own, lease and operate
its properties and assets and to conduct its business as it is now being
conducted. 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. 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.

    


    (h)     No Material Adverse
Change. Other than as disclosed in the Company’s Commission Documents,
since December 31, 2008 the Company has not experienced or suffered any Material
Adverse Effect.

    


    (i)      No Undisclosed
Liabilities. Except as set forth on Schedule
2.1(i), since December 31, 2008 neither the Company nor any of its
Subsidiaries has any liabilities, obligations, claims or losses (whether
liquidated or unliquidated, secured or unsecured, absolute, accrued, contingent
or otherwise) other than those incurred in the ordinary course of the Company’s
or its Subsidiaries’ respective businesses and which, individually or in the
aggregate, do not or would not have a Material Adverse Effect on the Company or
its Subsidiaries, as the case may be.

    


    (j)     
Off Balance Sheet
Arrangements.  There is no transaction, arrangement, or other
relationship between the Company and an unconsolidated or other off balance
sheet entity that is required to be disclosed by the Company in its Commission
Documents and is not so disclosed or that otherwise would be reasonably likely
to have a Material Adverse Effect.

    


    (k)     No Undisclosed Events or
Circumstances. 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 condition, which, under
applicable law, rule or regulation, requires public disclosure or announcement
by the Company but which has not been so publicly announced or
disclosed.

     

    
      
        
        

      

      
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    (l)      Indebtedness. Schedule
2.1(l) hereto sets forth as of the date hereof 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, whether
individually or in aggregate, 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 Schedule
2.1(l), neither the Company nor any Subsidiary is in default with respect
to any Indebtedness.

    


    (m)    Title to Assets.
Except as set forth on Schedule
2.1(m), each of the Company and the Subsidiaries has good and marketable
title to all of its real and personal property, free and clear of any mortgages,
pledges, charges, liens, security interests or other encumbrances. Except as set
forth on Schedule
2.1(m), all leases of the Company and each of its Subsidiaries are valid
and subsisting and in full force and effect.

    


    (n)     Insurance. The
Company and the Subsidiaries are insured by insurers of recognized financial
responsibility against such losses and risks and in such amounts as are prudent
and customary in the businesses and location in which the Company and the
Subsidiaries are engaged. Neither the Company nor any Subsidiary has any
knowledge that it will be unable to renew its existing insurance coverage for
the Company and the Subsidiaries as and when such coverage expires or to obtain
similar coverage from similar insurers as may be necessary to continue its
business without a significant increase in cost.

    


    (o)     Actions Pending.
There is no action, suit, claim, investigation, arbitration, alternate dispute
resolution proceeding or any other proceeding pending 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. There is no action, suit, claim, investigation,
arbitration, alternate dispute resolution proceeding or any other proceeding
pending or, to the knowledge of the Company, threatened, against or involving
the Company, any Subsidiary or any of their respective properties or assets.
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.

    


    (p)     Compliance with Law.
The business of the Company and the Subsidiaries has been and is presently being
conducted in accordance with all applicable federal, state and local
governmental laws, rules, regulations and ordinances, except for such
noncompliance that, individually or in the aggregate, would not cause a Material
Adverse Effect. The Company and each of its Subsidiaries have all franchises,
permits, licenses, consents and other governmental or regulatory authorizations
and approvals necessary for the conduct of its business as now being conducted
by it unless the failure to possess such franchises, permits, licenses, consents
and other governmental or regulatory authorizations and approvals, individually
or in the aggregate, would not have a Material Adverse Effect.

    


    (q)     Taxes. The Company
and each of the Subsidiaries has accurately prepared and filed all federal,
state and other tax returns required by law to be filed by it, has paid or made
provisions for the payment of all taxes shown to be due and all additional
assessments, and adequate provisions have been and are reflected in the
financial statements of the Company and the Subsidiaries for all current taxes
and other charges to which the Company or any Subsidiary is subject and which
are not currently due and payable. None of the federal income tax returns of the
Company or any Subsidiary have been audited by the Internal Revenue Service. The
Company has no knowledge of any additional assessments, adjustments or
contingent tax liability (whether federal or state) of any nature whatsoever,
whether pending or threatened against the Company or any Subsidiary for any
period, nor of any basis for any such assessment, adjustment or
contingency.

     

    
      
        
        

      

      
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    (r)      Certain Fees. 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.

    


    (s)     Disclosure. Neither
this Agreement or the Schedules hereto nor any other documents, certificates or
instruments furnished to the Purchasers by or on behalf of the Company or any
Subsidiary in connection with the transactions contemplated by this Agreement
contain any untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements made herein or therein, in the light
of the circumstances under which they were made herein or therein, not
misleading.

    


    (t)      Operation of
Business. Except as set forth in Schedule
2.1(t),
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, 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)     Environmental
Compliance. 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. Except as set
forth on Schedule
2.1(u),
the Commission Documents describe all material permits, licenses and other
authorizations issued under any Environmental Laws to the Company or its
Subsidiaries. “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. 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.

     

    
      
        
        

      

      
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    (v)     Books and Record Internal
Accounting Controls. The books and records of the Company and its
Subsidiaries accurately reflect in all material respects the information
relating to the business of the Company and the Subsidiaries, the location and
collection of their assets, and the nature of all transactions giving rise to
the obligations or accounts receivable of the Company or any Subsidiary. The
Company and each of its Subsidiaries maintain a system of internal accounting
controls sufficient, in the judgment of the Company, to provide reasonable
assurance that (i) transactions are executed in accordance with management’s
general or specific authorizations, (ii) transactions are recorded as necessary
to permit preparation of financial statements in conformity with GAAP and to
maintain asset accountability, (iii) access to assets is permitted only in
accordance with management’s general or specific authorization and (iv) the
recorded accountability for assets is compared with the existing assets at
reasonable intervals and appropriate action is taken with respect to any
differences.

    


    (w)    Material Agreements.
Except for the Transaction Documents (with respect to clause (i) only), as
disclosed in the Commission Documents or as set forth on Schedule
2.1(w) hereto, or as would not be reasonably likely to have a Material
Adverse Effect, (i) the Company and each of its Subsidiaries have performed all
obligations required to be performed by them to date under any written or oral
contract, instrument, agreement, commitment, obligation, plan or arrangement,
filed or required to be filed with the Commission (the “Material
Agreements”), (ii) neither the Company nor any of its Subsidiaries has
received any notice of default under any Material Agreement and, (iii) to the
best of the Company’s knowledge, neither the Company nor any of its Subsidiaries
is in default under any Material Agreement now in effect.

    


    (x)      Intellectual
Property.  The Company and its Subsidiaries own, or have rights
to use, all inventions, know-how, patents, patent applications, trademarks,
trademark applications, service marks, trade names, copyrights, licenses, trade
secrets and other similar rights that are necessary or material for use in
connection with their respective businesses now operated by them and presently
contemplated to be operated by them which the failure to so have would have or
reasonably be expected to result in a Material Adverse Effect (collectively, the
“Intellectual
Property Rights”).  None of the Company’s or any Subsidiary’s
Intellectual Property Rights have expired or terminated, or are expected to
expire or terminate, within three years from the date of this
Agreement.  None of the Company’s nor any Subsidiary has received
written notice that the Intellectual Property Rights used by the Company or any
Subsidiary violates or infringes upon the rights of any Person (as defined
below).  To the knowledge of the Company, the Company and its
Subsidiaries’ patents and other Intellectual Property Rights and the present
activities of the Company and its Subsidiaries do not infringe any patent,
copyright, trademark, trade name or other proprietary rights of any third party,
and there is no claim, action or proceeding being made or brought against, or to
the Company’s knowledge, being threatened against, the Company or any Subsidiary
regarding any of the Intellectual Property Rights.  The Company does
not have any knowledge of an infringement by another Person of any of the
Intellectual Property Rights by third parties and has no reason to believe that
any of its Intellectual Property Rights is unenforceable.  The Company
has taken commercially reasonable security measures to protect the secrecy,
confidentiality and value of all of their intellectual properties. “Person”
means an individual or a corporation, partnership, trust, incorporated or
unincorporated association, joint venture, limited liability company, joint
stock company, government (or an agency or political subdivision thereof) or
other entity of any kind.

    


    (y)     Transactions with
Affiliates. Except as set forth in the Commission Documents, there are no
loans, leases, agreements, contracts, royalty agreements, management contracts
or arrangements or other continuing transactions between (a) the Company or any
Subsidiary on the one hand, and (b) on the other hand, any officer, employee,
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.

     

    
      
        
        

      

      
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    (z)      Sarbanes-Oxley; Disclosure
Controls. The Company is in compliance in all material respects with all
of the provisions of the Sarbanes-Oxley Act of 2002 which are applicable to it
as of the Closing Date. The Company has established disclosure controls and
procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the
Company and designed such disclosure controls and procedures to ensure that
material information relating to the Company is made known to the certifying
officers by others within those entities, particularly during the period in
which the Company’s most recently filed periodic report under the Exchange Act
is being prepared. The Company’s certifying officers have evaluated the
effectiveness of the Company’s disclosure controls and procedures as of the end
of the most recent periodic reporting period under the Exchange Act (such date,
the “Evaluation
Date”). The Company presented in its most recently filed periodic report
under the Exchange Act the conclusions of the certifying officers about the
effectiveness of the disclosure controls and procedures based on their
evaluations as of the Evaluation Date. Since the Evaluation Date, there have
been no significant changes in the Company’s internal controls over financial
reporting (as such term is defined in Exchange Act Rules 13a-15(f) and
15d-15(f)) or, to the Company’s knowledge, in other factors that could
reasonably be expected to materially affect the Company’s internal controls over
financial reporting

    


    (aa)    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.

    


    (bb)   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
Section
7.1 herein, 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 Notes and
the Warrants, or for the performance by the Company of its obligations under the
Transaction Documents.

    


    (cc)   Employees. Neither
the Company nor any Subsidiary has any collective bargaining arrangements or
agreements covering any of its employees. Except as set forth on Schedule
2.1(cc),
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 right of any officer, employee or
consultant to be employed or engaged by the Company or such Subsidiary. No
officer, consultant or key employee of the Company or any Subsidiary whose
termination, either individually or in the aggregate, could have a Material
Adverse Effect, has terminated or, to the knowledge of the Company, has any
present intention of terminating his or her employment or engagement with the
Company or any Subsidiary.

    


    (dd)   Absence of Certain
Developments. Except as set forth on Schedule
2.1(dd),
since December 31, 2008, neither the Company nor any Subsidiary
has:

     

    
      
        
        

      

      
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    (i)           issued
any stock, bonds or other corporate securities or any rights, options or
warrants with respect thereto;

    


    (ii)          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;

    


    (iii)         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;

    


    (iv)         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;

    


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

    


    (vi)         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;

    


    (vii)        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;

    


    (viii)       made
any changes in employee compensation except in the ordinary course of business
and consistent with past practices;

    


    (ix)         made
capital expenditures or commitments therefor that aggregate in excess of
$100,000;

    


    (x)          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;

    


    (xi)         made
charitable contributions or pledges in excess of $25,000;

    


    (xii)        suffered
any material damage, destruction or casualty loss, whether or not covered by
insurance;

    


    (xiii)       experienced
any material problems with labor or management in connection with the terms and
conditions of their employment;

    


    (xiv)       effected
any two or more events of the foregoing kind which in the aggregate would be
material to the Company or its Subsidiaries; or

     

    
      
        
        

      

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

    


    (ee)   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.

    


    (ff)     ERISA. No liability
to the Pension Benefit Guaranty Corporation has been incurred with respect to
any Plan (as defined below) 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
Securities 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 (the
“Code”);
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
2.1(ff),
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.

    


    (gg)   Dilutive Effect. The
Company understands and acknowledges that its obligation to (i) issue Conversion
Shares upon an Optional Conversion of the Notes in accordance with this
Agreement and the Note, and (ii) its obligations to issue the Warrant Shares
upon the exercise of the Warrants in accordance with this Agreement and the
Warrants, is, in each case, absolute and unconditional regardless of the
dilutive effect that such issuance may have on the ownership interest of other
stockholders of the Company.

    


    (hh)   No Integrated
Offering. 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 prior offerings by 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.

    


    (ii)     Listing and Maintenance
Requirements.  Except as set forth in the Commission Documents,
the Company has not, in the two (2) years preceding the date hereof, received
notice (written or oral) from any Trading Market on which the Common Stock is or
has been listed or quoted to the effect that the Company is not in compliance
with the listing or maintenance requirements of such Trading
Market.  Except as set forth in the Commission Documents, the Company
is, and has no reason to believe that it will not in the foreseeable future
continue to be, in compliance with all such listing and maintenance
requirements. “Trading
Market” means the OTC Bulletin Board or any other Eligible Market, or any
other national securities exchange, market or trading or quotation facility on
which the Common Stock is then listed or quoted. “Eligible
Market” means any of the New York Stock Exchange, the American Stock
Exchange, the NASDAQ Global Select Market, the NASDAQ Global Market, the NASDAQ
Capital Market or the Over-the-Counter Bulletin Board.

     

    
      
        
        

      

      
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    (jj)     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 in any
way for the performance of the obligations of any other Purchaser under the
Transaction Documents. The Company acknowledges that the decision of each
Purchaser to purchase securities pursuant to this Agreement has been made by
such Purchaser independently of any other purchase and independently of any
information, materials, statements or opinions as to the business, affairs,
operations, assets, properties, liabilities, results of operations, condition
(financial or otherwise) or prospects of the Company or of its Subsidiaries
which may have made or given by any other Purchaser or by any agent or employee
of any other Purchaser, and no Purchaser or any of its agents or employees shall
have any liability to any Purchaser (or any other person) relating to or arising
from any such information, materials, statements or opinions. 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 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 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, 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 one of the
Purchasers and such counsel does not represent all of the Purchasers but only
such Purchaser and the other 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.

    


    (kk)   Questionable
Payments. Neither the Company nor any of its Subsidiaries, nor, to the
Company’s knowledge, any directors, officers, employees, agents or other Persons
acting on behalf of the Company or any of its Subsidiaries has, in the course of
its actions for, or on behalf of, the Company: (a) directly or indirectly, used
any corporate funds for unlawful contributions, gifts, entertainment or other
unlawful expenses relating to foreign or domestic political activity; (b) made
any direct or indirect unlawful payments to any foreign or domestic governmental
officials or employees or to any foreign or domestic political parties or
campaigns from corporate funds; (c) violated in any material respect any
provision of the Foreign Corrupt Practices Act of 1977, as amended; or (d) made
any other unlawful bribe, rebate, payoff, influence payment, kickback or other
unlawful payment to any foreign or domestic government official or
employee.

    


    (ll)     Application of Takeover
Protections. 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 the Company’s
charter documents or the laws of its state of incorporation that is or could
reasonably be expected to become applicable to any of the Purchasers as a result
of the Purchasers and the Company fulfilling their obligations or exercising
their rights under the Transaction Documents, including, without limitation, the
Company’s issuance of the Securities and the Purchasers’ ownership of the
Securities.

    


    (mm)  Transfer Agent. The
name, address, telephone number, fax number, contact person and email address of
the Company’s current transfer agent is set forth on Schedule
2.1(mm)
hereto.

     

    
      
        
        

      

      
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    Section
2.2     Representations and
Warranties of the Purchasers. Each Purchaser hereby makes the following
representations and warranties to the Company (with respect solely to itself and
not with respect to any other Purchaser), as of the date hereof, and as of the
Closing Date:

    


    (a)     Organization and Standing of
the Purchasers. If such Purchaser is an entity, such Purchaser is a
corporation, partnership or limited liability company duly incorporated or
organized, validly existing and in good standing under the laws of the
jurisdiction of its incorporation or organization.

    


    (b)     Authorization and
Power. Such Purchaser has the requisite power and authority to enter into
and perform this Agreement and to purchase the Notes and Warrants being sold to
it hereunder. The execution, delivery and performance of this Agreement by such
Purchaser and the consummation by it of the transactions contemplated hereby and
thereby have been duly authorized by all necessary corporate or partnership
action, and no further consent or authorization of such Purchaser or its board
of directors, stockholders or partners, as the case may be, is required. This
Agreement has been duly authorized, executed and delivered by such Purchaser and
constitutes, or shall constitute when executed and delivered, a valid and
binding obligation of the Purchaser enforceable against the Purchaser in
accordance with the terms thereof, except as such enforceability may be limited
by applicable bankruptcy, insolvency, reorganization, moratorium, liquidation,
conservatorship, receivership or similar laws relating to, or affecting
generally the enforcement of, creditor’s rights and remedies or by other
equitable principles of general application.

    


    (c)     No Conflicts. The
execution, delivery and performance of this Agreement and the consummation by
such Purchaser of the transactions contemplated hereby or relating hereto do not
and will not (i) result in a violation of such Purchaser’s charter documents or
bylaws or other organizational documents or (ii) conflict with, or constitute a
default (or an event which with notice or lapse of time or both would become a
default) under, or give to others any rights of termination, amendment,
acceleration or cancellation of any agreement, indenture or instrument or
obligation to which such Purchaser is a party or by which its properties or
assets are bound, or result in a violation of any law, rule, or regulation, or
any order, judgment or decree of any court or governmental agency applicable to
such Purchaser or its properties (except for such conflicts, defaults and
violations as would not, individually or in the aggregate, have a material
adverse effect on such Purchaser). Such Purchaser is not required to obtain any
consent, authorization or order of, or make any filing or registration with, any
court or governmental agency in order for it to execute, deliver or perform any
of its obligations under this Agreement or to purchase the Notes or acquire the
Warrants in accordance with the terms hereof; provided that for purposes of
the representation made in this sentence, such Purchaser is assuming and relying
upon the accuracy of the relevant representations and agreements of the Company
herein.

    


    (d)     Acquisition for
Investment. Such Purchaser is acquiring the Securities solely for its own
account for the purpose of investment and not with a view to or for sale in
connection with distribution. Each Purchaser does not have a present intention
to sell the Securities, nor a present arrangement (whether or not legally
binding) or intention to effect any distribution of the Securities to or through
any person or entity; provided, however, that by
making the representations herein and subject to Section
2.2(h)
below, 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 Federal and state securities laws applicable to such
disposition. Such Purchaser acknowledges that it is able to bear the financial
risks associated with an investment in the Securities and that it has been given
full access to such records of the Company and the Subsidiaries and to the
officers of the Company and the Subsidiaries and received such information as it
has deemed necessary or appropriate to conduct its due diligence investigation
and has sufficient knowledge and experience in investing in companies similar to
the Company in terms of the Company’s stage of development so as to be able to
evaluate the risks and merits of its investment in the Company.

     

    
      
        
        

      

      
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    (e)     Status of Purchasers.
Such Purchaser is an “accredited investor” as defined in Regulation D
promulgated under the Securities Act. Such Purchaser is not required to be
registered as a broker-dealer under Section 15 of the Exchange Act and such
Purchaser is not a broker-dealer.

    


    (f)      Opportunities for Additional
Information. Such Purchaser acknowledges that such Purchaser has had the
opportunity to ask questions of and receive answers from, or obtain additional
information from, the executive officers of the Company concerning the financial
and other affairs of the Company, and to the extent deemed necessary in light of
such Purchaser’s personal knowledge of the Company’s affairs, such Purchaser has
asked such questions and received answers to the full satisfaction of such
Purchaser, and such Purchaser desires to invest in the Company.

    


    (g)     No General
Solicitation. Such Purchaser acknowledges that the Securities were not
offered to such Purchaser by means of any form of general or public solicitation
or general advertising, or publicly disseminated advertisements or sales
literature, including (i) any advertisement, article, notice or other
communication published in any newspaper, magazine, or similar media, or
broadcast over television or radio, or (ii) any seminar or meeting to which such
Purchaser was invited by any of the foregoing means of
communications.

    


    (h)     Rule 144. Such
Purchaser understands that the Securities must be held indefinitely unless such
Securities are registered under the Securities Act or an exemption from
registration is available. Such Purchaser acknowledges that such Purchaser is
familiar with Rule 144 of the rules and regulations of the Commission, as
amended, promulgated pursuant to the Securities Act (“Rule
144”), and that such Purchaser has been advised that Rule 144 permits
resales only under certain circumstances. Such Purchaser understands that to the
extent that Rule 144 is not available, such Purchaser will be unable to sell
any Securities without either registration under the Securities Act or the
existence of another exemption from such registration requirement.

    


    (i)      General. Such
Purchaser understands that the Securities are being offered and sold in reliance
on a transactional exemption from the registration requirement of Federal and
state securities laws and the Company is relying upon the truth and accuracy of
the representations, warranties, agreements, acknowledgments and understandings
of such Purchaser set forth herein in order to determine the applicability of
such exemptions and the suitability of such Purchaser to acquire the
Securities.

    


    (j)      Independent
Investment. Except as may be disclosed in any filings with the Commission
by it under Section 13 and/or Section 16 of the Exchange Act, such Purchaser has
not agreed to act with any other Purchaser for the purpose of acquiring,
holding, voting or disposing of the Securities purchased hereunder for purposes
of Section 13(d) under the Exchange Act, and such Purchaser is acting
independently with respect to its investment in the Securities.

    


    (k)     Short Sales.
Purchaser has not, during the last thirty (30) days prior to the date hereof,
directly or indirectly, nor has any party acting on behalf of or pursuant to any
understanding with such Purchaser, effected or agreed to effect any short sale,
whether or not against the box, established any “put equivalent position” (as
defined in Rule 16(a)-1(h) under the Exchange Act) with respect to any security
of the Company, granted any other right (including, without limitation, any put
or call option) with respect to any security of the Company or with respect to
any security that includes, relates to, or derives any significant part of its
value from any security of the Company or otherwise sought to hedge its
positioning of the Company’s securities.  Such Purchaser shall not,
and shall cause any affiliates not to, engage, directly or indirectly, in any
short sale transactions in the securities of the Company during the period from
the date hereof until such time as one (1) year from the date of effectiveness
of the Registration Statement (as defined in Section
7.1). Such Purchaser understands and acknowledges, severally and not
jointly with any other Purchaser, that the Commission currently takes the
position that covering a short position established prior to effectiveness of a
resale registration statement with shares included in such registration
statement would be a violation of Section 5 of the Securities Act, as set forth
in Item 65, Section 5 under Section A, of the Manual of Publicly Available
Telephone Interpretations, dated July 1997, compiled by the Office of Chief
Counsel, Division of Corporation Finance

     

    
      
        
        

      

      
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    ARTICLE
III

    Covenants

    


    The
Company covenants with each of the Purchasers as follows, which covenants are
for the benefit of each Purchaser and its permitted assignees (as defined
herein):

    


    Section
3.1         Securities
Compliance. The Company shall notify the Commission in accordance with
their rules and regulations, of the transactions contemplated by any of the
Transaction Documents, including filing a Form D with respect to the Notes,
Warrants, the Conversion Shares and the Warrant Shares as required under
Regulation D and applicable “blue sky” laws, and shall take all other necessary
action and proceedings as may be required and permitted by applicable law, rule
and regulation, for the legal and valid issuance of the Notes, the Warrants, the
Conversion Shares and the Warrant Shares to the Purchasers or subsequent
holders.

    


    Section
3.2         Registration and
Listing. The Company shall (a) comply in all respects with its reporting
and filing obligations under the Exchange Act, (b) comply with all requirements
related to any registration statement filed pursuant to this Agreement, and (c)
not take any action or file any document (whether or not permitted by the
Securities Act or the rules promulgated thereunder) to terminate or suspend such
registration or to terminate or suspend its reporting and filing obligations
under the Exchange Act or Securities Act, except as permitted herein. The
Company will take all action necessary to continue the listing or trading of its
Common Stock on the OTC Bulletin Board or other exchange or market on which the
Common Stock is trading or may be traded in the future. Subject to the terms of
the Transaction Documents, the Company further covenants that it will take such
further action as the Purchasers may reasonably request, all to the extent
required from time to time to enable the Purchasers to sell the Securities
without registration under the Securities Act within the limitation of the
exemptions provided by Rule 144 promulgated under the Securities Act. Upon the
request of the Purchasers, the Company shall deliver to the Purchasers a written
certification of a duly authorized officer as to whether it has complied with
such requirements.


     

    Section
3.3         Inspection
Rights. In
the event that the Purchaser no longer has a representative on the Company’s
board of directors, the Company shall permit, during normal business hours and
upon reasonable request and reasonable notice, each Purchaser or any employees,
agents or representatives thereof, so long as any Notes remain outstanding, for
purposes reasonably related to such Purchaser’s interests as a convertible
debtholder, to examine and make reasonable copies of and extracts from the
records and books of account of, and visit and inspect the properties, assets,
operations and business of the Company and any Subsidiary, and to discuss the
affairs, finances and accounts of the Company and any Subsidiary with any of its
officers, consultants, directors, and key employees.  As a condition
to such inspection, Purchasers shall keep such information confidential; provided that such
information may be disclosed (i) to the extent required by applicable law,
regulation or legal process, subpoena, civil investigative demand or other
similar process, (ii) to the extent reasonably necessary in connection with the
enforcement of rights under this Agreement, (iii) to any governmental, judicial
or regulatory authority requiring or requesting such information, and (iv) to
its directors, officers, employees, agents, managers and general partners,
consultants, accountants, financial advisers, legal counsel and other
professional advisers.

     

    
      
        
        

      

      
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    Section
3.4          Compliance with Laws.
The Company shall comply, and cause each Subsidiary, whether such Subsidiary is
in existence as of the date of this agreement or formed or acquired subsequent
to the date of this agreement, to comply, with all applicable laws, rules,
regulations and orders, noncompliance with which could have a Material Adverse
Effect.

    


    Section
3.5         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.

    


     Section 3.6    
    Furnishing of
Information. Until all of the Securities are eligible for sale
without limitations concerning the availability of current public information
under Rule 144 promulgated under the Securities Act, the Company covenants to
timely file (or obtain extensions in respect thereof and file within the
applicable grace period) all reports required to be filed by the Company after
the date hereof pursuant to the Exchange Act. Until all of the Securities are
eligible for sale without limitations concerning the availability of current
public information under Rule 144 promulgated under the Securities Act, if the
Company is not required to file reports pursuant to such laws, it will prepare
and furnish to the Purchasers and make publicly available in accordance with
Rule 144(c) such information as is required for the Purchasers to sell the
Securities under Rule 144. The Company further covenants that it will take such
further action as any holder of Securities may reasonably request, all to the
extent required from time to time to enable such Person to sell the Securities
without registration under the Securities Act within the limitation of the
exemptions provided by Rule 144.

    


    Section 3.7       
  Reporting
Requirements. If the Commission ceases making periodic reports filed
under 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 Notes or shall
beneficially own any Securities:

    


    (a)     quarterly
reports filed with the Commission on Form 10-Q as soon as practical after the
document is filed with the Commission, and in any event within five (5) days
after the document is filed with the Commission;

    


    (b)     annual
reports filed with the Commission on Form 10-K as soon as practical after the
document is filed with the Commission, and in any event within five (5) days
after the document is filed with the Commission; and

    


    (c)     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.

    


    Section
3.8          Amendments. The
Company shall not amend or waive any provision of the Certificate or Bylaws of
the Company in any way that would materially and adversely affect the rights of
the holders of the Notes and/or Warrants. No consideration shall be offered or
paid to any holders of the Notes or the Warrants to amend or consent to a waiver
or modification of any provision of any of the Transaction Documents unless the
same consideration also is offered to all of the parties to the Transaction
Documents, holders of Notes or Warrants, as the case may be.  The
Company has not, directly or indirectly, made any agreements with any Purchasers
relating to the terms or conditions of the transactions contemplated by the
Transaction Documents except as set forth in the Transaction
Documents.  Without limiting the foregoing, the Company confirms that,
except as set forth in this Agreement, no Purchaser has made any commitment or
promise or has any other obligation to provide any financing to the Company or
otherwise.

     

    
      
        
        

      

      
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    Section 3.9        
Other
Agreements. The Company shall not enter into any agreement in which the
terms of such agreement would materially restrict or impair the right or ability
to perform of the Company or any Subsidiary under any Transaction
Document.

    


    Section 3.10       Distributions. So
long as any Notes remain outstanding, the Company agrees that it shall not
(i) declare or pay any dividends or make any distributions to any holder(s) of
Common Stock or (ii) purchase or otherwise acquire for value, directly or
indirectly, any Common Stock or other equity security of the
Company.

    


    Section 3.11    
  Use
of Proceeds. The net proceeds from the sale of the Notes and Warrants
hereunder shall be used by the Company for general corporate purposes, and
not to redeem any Common Stock or securities convertible, exercisable or
exchangeable into Common Stock, to settle any outstanding litigation or to
cause any increase in management’s compensation, direct or otherwise, in a
manner other than in the ordinary course of business.  An estimated
allocation of the net proceeds from the sale of the Securities hereunder is set
forth on Schedule
3.11
hereto.

    


    Section 3.12    
  Reservation of
Shares. So long as any of the Notes 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 twenty percent
(120%) of the aggregate number of shares of Common Stock needed to provide for
the issuance of the Conversion Shares and the Warrant Shares.

    


    Section 3.13    
  Transfer
Agent Instructions. The Company shall issue irrevocable instructions to
its transfer agent, and any subsequent transfer agent, to issue certificates,
registered in the name of each Purchaser or its respective nominee(s), for the
Conversion Shares and the Warrant Shares in such amounts as specified from time
to time by each Purchaser to the Company upon an Optional Conversion of the
Notes or exercise of the Warrants in the form of Exhibit
D
attached hereto (the “Irrevocable
Transfer Agent Instructions”). Prior to registration of the Conversion
Shares and the Warrant Shares under the Securities Act, all such certificates
shall bear the restrictive legend specified in Section
5.1 of this Agreement. The Company warrants that no instruction other
than the Irrevocable Transfer Agent Instructions referred to in this Section
3.13
will be given by the Company to its transfer agent and that the Conversion
Shares and Warrant Shares shall otherwise be freely transferable on the books
and records of the Company as and to the extent provided in this Agreement. If a
Purchaser provides the Company with an opinion of counsel, in a generally
acceptable form, to the effect that a public sale, assignment or transfer of the
Conversion Shares and Warrant Shares may be made without registration under the
Securities Act or the Purchaser provides the Company with reasonable assurances
that such Conversion Shares and Warrant Shares can be sold pursuant to Rule 144
without any restriction as to the number of securities acquired as of a
particular date that can then be immediately sold, the Company shall permit the
transfer, and, in the case of the Conversion Shares and the Warrant Shares,
promptly instruct its transfer agent to issue one or more certificates in such
name and in such denominations as specified by such Purchaser and without any
restrictive legend. The Company acknowledges that a breach by it of its
obligations under this Section
3.13
will cause irreparable harm to the Purchasers by vitiating the intent and
purpose of the transaction contemplated hereby. Accordingly, the Company
acknowledges that the remedy at law for a breach of its obligations under this
Section
3.13
will be inadequate and agrees, in the event of a breach or threatened breach by
the Company of the provisions of this Section
3.13,
that the Purchasers shall be entitled, in addition to all other available
remedies, to an order and/or injunction restraining any breach and requiring
immediate issuance and transfer, without the necessity of showing economic loss
and without any bond or other security being required.

     

    
      
        
        

      

      
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    Section 3.14     
Disposition of
Assets. So long as any Notes remain outstanding, neither the Company nor
any Subsidiary shall sell, transfer or otherwise dispose of any of its
properties, assets and rights including, without limitation, its software and
intellectual property, to any person except for (A) sales to customers in the
ordinary course of business; (B) sales of assets not in excess of 25% of the
Company’s total assets as shown on its balance sheet; or (C) with the prior
written consent of the holders of a majority of the holders of the Notes and
Warrants then outstanding.

    


    Section 3.15       Reporting
Status. So
long as a Purchaser beneficially owns any of the Securities, the Company shall
timely file all reports required to be filed with the Commission pursuant to the
Exchange Act, and the Company shall not cease filing reports under the Exchange
Act even if the Exchange Act or the rules and regulations thereunder would
permit such termination.

    


    Section 3.16       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 four (4) business days after the Closing has been consummated. The Company
shall also file with the Commission 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 form of Note, the
form of Warrant and the Press Release) as soon as practicable following the
Closing Date but in no event more than four (4) Trading Days following the
Closing Date, which Press Release and Form 8-K shall be subject to prior review
and comment by counsel for the Purchasers. “Trading
Day” means any day during which the OTC Bulletin Board (or other
quotation venue or principal exchange on which the Common Stock is traded) shall
be open for trading.

    


    Section 3.17       Disclosure of Material
Information. Except for any information disclosed to Robert Thomson, the
Company represents, covenants and agrees that neither it nor any other person
acting on its behalf has provided or will provide any Purchaser or its agents or
counsel with any information that the Company believes constitutes material
non-public information (other than with respect to the transactions contemplated
by this Agreement), unless prior thereto such Purchaser shall have executed a
written agreement regarding the confidentiality and use of such information. The
Company understands and confirms that each Purchaser shall be relying on the
foregoing representations in effecting transactions in securities of the
Company.

    


    Section 3.18       Pledge of Securities.
The Company acknowledges and agrees that the Securities may be pledged by a
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; provided that a Purchaser and
its pledgee shall be required to comply with the provisions of Article
V hereof in order to effect a sale, transfer or assignment of Securities
to such pledgee. At the Purchasers’ expense, the Company hereby agrees to
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.

     

    
      
        
        

      

      
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    Section 3.19       Form S-1 Eligibility. The
Company currently meets the “registrant eligibility” and transaction
requirements set forth in the general instructions to Form S-1 applicable to
“resale” registrations on Form S-1 and the Company shall file all reports
required to be filed by the Company with the Commission in a timely
manner.

    


    Section 3.20       DTC. Not later than
the effective date of the Registration Statement, the Company shall cause its
Common Stock to be eligible for transfer with its transfer agent pursuant to the
Depository Trust Company Automated Securities Transfer Program.

    


    Section
3.21       Issuance of Variable
Securities. The Company shall not
issue any Options or Convertible Securities (each as defined in the Note) with
an exercise price or a conversion price or a number of underlying shares that
floats or resets or otherwise varies or is subject to adjustment based (directly
or indirectly) on market prices of the Common Stock.

    


    Section
3.22       Approval of
Acquisitions.  So long as any Notes remain outstanding, the
Company shall not effect, or agree to effect, an acquisition or buy out of or
with any entity (including without limitation the acquisition of a substantial
portion of the outstanding securities or assets of another entity other than in
the ordinary course of business), or a consolidation or merger of the Company
with or into any other corporation or corporations (or other entity or
entities), or a sale of all or substantially all of the assets of the Company,
or the effectuation by the Company of a transaction or series of related
transactions in which more than 50% of the voting shares of the Company is
disposed of or conveyed, without providing the holders of the Notes with ten
(10) days’ notice of such transaction.

    


    Section
3.23       Most Favored Nations.
If the Company has, on or prior to the date of this Agreement, entered into, or
shall in the future enter into, any agreement with any purchaser or holder of
capital stock of the Company, by providing such purchaser or holder with any
terms that are more favorable than the rights made available to the Purchasers
pursuant any terms set out in the Transaction Documents in issue as of the date
hereof, the Company shall promptly notify the Purchasers of such terms in
writing and Purchasers shall have the right to elect in writing within thirty
(30) days of the receipt of such notice to elect to have such terms apply to
such Transaction Documents.  This provision shall only apply to an
equity or convertible debt investment by one or more investors in excess of $3.0
million and shall terminate upon the earlier to occur of (A) one (1) year from
the date of this Agreement or (B) at any time Purchasers own in the aggregate
less than four (4%) percent of the Company’s outstanding common stock on a fully
diluted basis.

     

    ARTICLE
IV

    Conditions

    


    Section
4.1          Conditions Precedent to the
Obligation of the Company to Sell the Securities. The
obligation hereunder of the Company to issue and sell the Securities to the
Purchasers at the Closing is subject to the satisfaction or waiver, at or before
the Closing, of each of the conditions set forth below. These conditions are for
the Company’s sole benefit and may be waived by the Company at any time in its
sole discretion.

    


    (a)     Accuracy of Each
Purchaser’s Representations and
Warranties. The representations and warranties of each Purchaser shall be
true and correct in all material respects as of the date when made and as of the
Closing Date as though made at that time, except for representations and
warranties that are expressly made as of a particular date, which shall be true
and correct in all material respects as of such date.

    


    (b)     Performance by the
Purchasers. Each Purchaser shall have performed, satisfied and complied
in all respects with all covenants, agreements and conditions required by this
Agreement to be performed, satisfied or complied with by such Purchaser at or
prior to the Closing.


    
      
         


      

      
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    (c)       No
Injunction. No statute,
rule, regulation, executive order, decree, ruling or injunction shall have been
enacted, entered, promulgated or endorsed by any court or governmental authority
of competent jurisdiction which prohibits the consummation of any of the
transactions contemplated by this Agreement.

    


    (d)       Delivery of
Purchase Price. The
Purchase Price for the Securities to be issued at the Closing has been delivered to the Company.

    


    (e)       Surrender of
Existing Notes.
The Exiting Notes
have been surrendered to the Company for cancellation.

    


    (f)        Delivery of
Transaction Documents. The
Transaction Documents have been duly executed and delivered by the Purchasers to
the Company (as of the
Closing).

    


    Section
4.2     Conditions
Precedent to the Obligation of the Purchasers to Purchase the Securities. The obligation hereunder of each
Purchaser to acquire and pay for the Securities is subject to the satisfaction or
waiver, at or before the Closing, of each of the conditions set
forth below. These conditions are for each Purchaser’s sole benefit and may be waived by such
Purchaser at any time in its sole discretion.

    


    (a)       Accuracy of
the Company’s
and Nectar’s
Representations
and Warranties. Each of the
representations and warranties of the Company and Nectar in this Agreement shall be true and
correct in all respects as of the date when made and as of the Closing
Date, except for
representations and warranties that are expressly made as of a particular date,
which shall be true and correct in all respects as of such
date.

    


    (b)       Performance
by the Company and
Nectar. The Company
and Nectar shall have performed, satisfied and
complied in all respects with all covenants, agreements and conditions required
by this Agreement to be performed, satisfied or complied with by the Company
and Nectar at or prior to the Closing.

    


    (c)       No
Suspension, Etc. Trading in
the Company’s Common Stock shall not have been
suspended by the Commission or the OTC Bulletin Board (except for any suspension
of trading of limited duration agreed to by the Company, which suspension shall
be terminated prior to the Closing), and, at any time prior to the Closing Date,
trading in securities generally as reported by Bloomberg Financial Markets
(“Bloomberg”) shall not have been suspended or
limited, or minimum prices shall not have been established on securities whose
trades are reported by Bloomberg, or on the New York Stock Exchange, nor shall a
banking moratorium have been declared either by the United States or New York
State authorities, nor shall there have occurred any material outbreak or
escalation of hostilities or other national or international calamity or crisis
of such magnitude in its effect on, or any material adverse change in any
financial market which, in each case, in the judgment of such Purchaser, makes
it impracticable or inadvisable to purchase the Securities to be issued as of the
Closing.

    


    (d)       No
Injunction. No statute,
rule, regulation, executive order, decree, ruling or injunction shall have been
enacted, entered, promulgated or endorsed by any court or governmental authority
of competent jurisdiction which prohibits the consummation of any of the
transactions contemplated by this Agreement.


    
      
         


      

      
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    (e)       No
Proceedings or Litigation.
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.

    


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

    


    (g)       Intentionally
omitted.

    


    (h)       Notes and
Warrants. The
Company and Nectar, as
applicable, shall have
executed and delivered to the Purchasers the certificates (in such denominations
as such Purchaser shall request) for the Notes and Warrants being acquired by such Purchaser at
the Closing (in such denominations as such
Purchaser shall request).

    


    (i)        Resolutions. The board of directors of the Company and Nectar shall have adopted resolutions
consistent with Section
2.1(b) hereof in a form
reasonably acceptable to such Purchaser (the “Resolutions”).

    


    (j)        Reservation
of Shares. So long as any
of the Notes 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 (i) such number of shares of Common Stock equal to one hundred twenty percent
(120%) of the number of shares of Common Stock as shall from time to time be
sufficient to effect an
Optional Conversion of all
of the Notes and (ii) as of the date hereof, such number of shares of Common Stock equal
to one hundred twenty
percent (120%) of the number of shares of Common
Stock as shall from time to time be sufficient to effect the exercise of
the Warrants then
outstanding.

    


    (k)       Transfer
Agent Instructions. As of
the Closing Date, the Irrevocable Transfer Agent Instructions, in the form of
Exhibit
D attached hereto, shall have been
delivered to and acknowledged in writing by the
Company’s transfer agent.

    


    (l)       
Intentionally
omitted.

    


    (m)      Good Standing
Certificates.  The Company and Nectar shall have delivered to
the Purchasers good standing certificates showing it and any subsidiary are
validly existing and in good standing under the laws of the state of their
incorporation and as a foreign corporation in each jurisdiction in which the
nature of the business conducted or property owned by such entity makes such
qualification necessary, except where the failure to be so qualified or in good
standing, as the case may be, would not result in a direct and/or indirect
Material Adverse Effect.

    


    (n)       Secretary’s
Certificate. The
Company and Nectar 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, and (iv) the
authority and incumbency of the officers of the Company executing the Transaction Documents, the
Securities and any other
documents required to be executed or delivered in connection
therewith.

    


    (o)       Officer’s
Certificate. The
Company and Nectar shall
have delivered to the Purchasers a certificate of an executive officer of the
Company, dated as of the Closing Date, confirming the accuracy of the
Company’s representations, warranties and
covenants as of the Closing Date and confirming the compliance by the Company
with the conditions precedent set forth in this Section
4.2 as of the Closing
Date.


    
      
         


      

      
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    (p)       Material
Adverse Effect. No Material
Adverse Effect shall have occurred at or before the Closing
Date.

    


    ARTICLE V

    Stock Certificate
Legend

    


    Section
5.1         Legend. Each certificate representing the
Notes and the Warrants, and, if appropriate,
securities issued upon conversion or exercise thereof, shall be stamped or
otherwise imprinted with a legend substantially in the following form (in
addition to any legend required by applicable state securities or “blue sky” laws):

     

    
      THE
SECURITIES REPRESENTED BY THIS CERTIFICATE (THE “SECURITIES”) HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR APPLICABLE STATE SECURITIES
LAWS, AND MAY NOT BE SOLD, TRANSFERRED, OR OTHERWISE DISPOSED OF IN THE ABSENCE
OF SUCH REGISTRATION OR RECEIPT BY THE COMPANY OF A WRITTEN OPINION OF COUNSEL
IN FORM, SUBSTANCE AND SCOPE REASONABLY SATISFACTORY TO THE COMPANY THAT SUCH
SECURITIES MAY BE SOLD, TRANSFERRED,  OR OTHERWISE DISPOSED OF, UNDER
AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT AND SUCH STATE
SECURITIES LAWS.

    

    


    The Company agrees to reissue
certificates representing any of the Conversion Shares and the Warrant Shares, without the legend set
forth above if at such time, prior to making any transfer of any such
securities, such holder thereof shall give written notice to the Company
describing the manner and terms of such transfer and removal as the Company may
reasonably request. Such proposed transfer and removal will not be effected
until: (a) either (i) the Company has received an opinion of counsel reasonably
satisfactory to the Company, to the effect that the registration of
the Conversion Shares or
the Warrant Shares under
the Securities Act is not required in connection with such proposed transfer,
(ii) a registration statement under the Securities Act covering such proposed
disposition has been filed by the Company with the Commission and has become
effective under the Securities Act, (iii) the Company has received other
evidence reasonably satisfactory to the Company that such registration and
qualification under the Securities Act and state securities laws are not
required, or (iv) the holder provides the Company with reasonable assurances
that such security can be sold pursuant to Rule 144 under the Securities Act;
and (b) either (i) the Company has received an opinion of counsel reasonably
satisfactory to the Company, to the effect that registration or qualification
under the securities or “blue sky” laws of any state is not required in
connection with such proposed disposition, or (ii) compliance with applicable
state securities or “blue sky” laws has been effected or a valid
exemption exists with respect thereto. The Company will respond to any such
notice from a holder within five (5) business days. In the case of any proposed
transfer under this Section
5.1, the Company will use
reasonable efforts to comply with any such applicable state securities or
“blue sky” laws, but shall in no event be
required, (x) to qualify to do business in any state where it is not then
qualified, (y) to take any action that would subject it to tax or to the general
service of process in any state where it is not then subject, or (z) to comply
with state securities or “blue sky” laws of any state for which
registration by coordination is unavailable to the Company. The restrictions on
transfer contained in this Section
5.1 shall be in addition
to, and not by way of limitation of, any other restrictions on transfer
contained in any other section of this Agreement. Whenever a
certificate representing the Conversion Shares or the Warrant Shares is required to be issued
to a Purchaser without a legend, in lieu of delivering physical certificates
representing the Conversion
Shares or the Warrant
Shares (provided that a registration statement under the Securities Act
providing for the resale of the Warrant Shares and the
Conversion Shares is then
in effect), the Company shall cause its transfer agent to electronically
transmit the Conversion
Shares or the Warrant
Shares to a Purchaser by crediting the account of such Purchaser or such
Purchaser’s Prime Broker with the Depository Trust
Company (“DTC”) through its Deposit Withdrawal Agent
Commission (“DWAC”) system (to the extent not inconsistent
with any provisions of this Agreement).


    
      
         


      

      
        22

        
          

        

      

      
         


      

    


    ARTICLE VI

    Indemnification

    


    Section
6.1        General
Indemnity. The Company
agrees to indemnify and hold harmless the Purchasers (and their respective
directors, officers, managers, partners, members, shareholders, affiliates,
agents, attorneys,
successors and assigns)
from and against any and all losses, liabilities, deficiencies, costs, damages
and expenses (including, without limitation, reasonable attorneys’ fees, charges and disbursements)
incurred by the Purchasers as a result of any inaccuracy in or breach of the
representations, warranties or covenants made by the Company
herein.

    


    Section
6.2         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.


    
      
         


      

      
        23

        
          

        

      

      
         


      

    


    ARTICLE VII

    Registration Rights

    


    Section
7.1          Piggyback Registration
Rights.  If at any time the Company shall determine to prepare
and file with the Commission a registration statement (a “Registration
Statement”) relating to an offering for its own account or the account of
others under the Securities Act of any of its equity securities, other than on
Form S-4 or Form S-8 (each as promulgated under the Securities Act) or their
then equivalents relating to equity securities to be issued solely in connection
with any acquisition of any entity or business or equity securities issuable in
connection with stock option or other employee benefit plans, the Company shall
send to each holder of the Notes and Warrants written notice of such
determination and, if within thirty (30) days after receipt of such notice, or
within such shorter period of time as may be specified by the Company in such
written notice as may be necessary for the Company to comply with its
obligations with respect to the timing of the filing of such Registration
Statement, any such holder shall so request in writing (which request shall
specify the Conversion Shares and
the Warrant Shares intended to be disposed of by the Purchasers, if any),
the Company will cause the registration under the Securities Act of all Conversion Shares and the Warrant
Shares which the Company has been so requested to register by the holder, to the
extent required to permit the disposition of the Conversion Shares and the Warrant
Shares so to be registered; provided that if at any time
after giving written notice of its intention to register any securities and
prior to the effective date of the Registration Statement filed in connection
with such registration, the Company shall determine for any reason not to
register or to delay registration of such securities, the Company may, at its
election, give written notice of such determination to such holder and,
thereupon, (i) in the case of a determination not to register, shall be relieved
of its obligation to register any Conversion Shares and Warrant
Shares in connection with such registration (but not from its obligation to pay
fees and expenses in accordance with Section
8.1 hereof), and (ii) in the case of a determination to delay
registering, shall be permitted to delay registering any Conversion Shares and Warrant
Shares being registered pursuant to this Section
7.1 for the same period as the delay in registering such other
securities. The Company shall include in such Registration Statement all or any
part of such Conversion Shares and
Warrant Shares such holder requests to be registered; provided, however, that the
Company shall not be required to register any Conversion Shares and Warrant
Shares pursuant to this Section
7.1 that are eligible for resale without limitations concerning the
availability of current public information pursuant to Rule 144 of the
Securities Act. In the case of an underwritten public offering, if the managing
underwriter(s) or underwriter(s) should reasonably object to the inclusion of
the Conversion Shares and
Warrant Shares in such Registration Statement, then if the Company after
consultation with the managing underwriter should reasonably determine that the
inclusion of such Conversion
Shares and Warrant Shares would materially adversely affect the offering
contemplated in such Registration Statement, and based on such determination
recommends inclusion in such Registration Statement of fewer or none of the
Conversion Shares and
Warrant Shares of the holders, then (x) the number of Conversion Shares and Warrant
Shares of the holders included in such Registration Statement shall be reduced
pro-rata among such holders (based upon the number
of Conversion Shares and
Warrant Shares requested to be included in the registration), if the
Company after consultation with the underwriter(s) recommends the inclusion of
fewer Conversion Shares and
Warrant Shares, or (y) none of the Conversion Shares and Warrant
Shares of the Holders shall be included in such Registration Statement, if the
Company after consultation with the underwriter(s) recommends the inclusion of
none of such Conversion Shares and
Warrant Shares; provided, however, that if
securities are being offered for the account of other persons or entities as
well as the Company, such reduction shall not represent a greater fraction of
the number of Conversion Shares
and Warrant Shares intended to be offered by the holders than the
fraction of similar reductions imposed on such other persons or entities (other
than the Company).


    
      
         


      

      
        24

        
          

        

      

      
         


      

    


    Section
7.2         Assignment
of Registration Rights. The
rights of each Purchaser hereunder, including the right to have the Company
register for resale Conversion Shares and Warrant Shares in accordance with the
terms of this Agreement, shall be automatically assignable by each Purchaser to
any Person who acquires all or a portion of the Conversion Shares and the Warrant Shares
if: (i) the Purchaser
agrees in writing with the transferee or assignee to assign such rights, and a
copy of such agreement is furnished to the Company within a reasonable time
after such assignment, (ii) the Company is, within a reasonable time after such
transfer or assignment, furnished with written notice of (A) the name and
address of such transferee or assignee, and (B) the securities with respect to
which such registration rights are being transferred or assigned, (iii)
following such transfer or assignment the further disposition of such securities
by the transferee or assignees is restricted under the Securities Act and
applicable state securities laws unless such securities are registered in a
Registration Statement pursuant to Section
7.1 (in which case the Company shall be
obligated to amend such Registration Statement to reflect such transfer or
assignment) or are otherwise exempt from registration, (iv) at or before the
time the Company receives the written notice contemplated by clause (ii) of this
Section
7.2, the transferee or
assignee agrees in writing with the Company to be bound by all of the provisions
of this Agreement, and (v) such transfer shall have been made in accordance with
the applicable requirements of this Agreement. In addition, each Purchaser shall
have the right to assign its rights hereunder to any other person with the prior
written consent of the Company, which consent shall not unreasonably be
withheld.  The rights to assignment shall apply to the Purchasers (and
to subsequent) successors and assigns.

    


    Section
7.3          Underwriter
Status. Subject to compliance with applicable
law, the Company may not deem any Purchaser to be an “underwriter” within
the meaning of the Securities Act within any Registration Statement nor file any
such Registration Statement without the prior written consent of such
Purchaser.

    


    ARTICLE
VIII

    Miscellaneous

    


    Section 8.1        
 Fees and
Expenses. Except as
otherwise set forth in this Agreement and the other Transaction Documents, 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. Notwithstanding the foregoing sentence, the Company shall pay all
reasonable attorneys’ fees and expenses (including
disbursements and out-of-pocket expenses) incurred by the Purchasers in
connection with (i) the preparation, negotiation, execution and delivery of this
Agreement and the other Transaction Documents and the transactions contemplated
thereunder, which payment shall be made at the Closing (which fees and expenses shall not
exceed $25,000), (ii) the filing and declaration of
effectiveness by the Commission of the Registration Statement (which fees and expenses shall not
exceed $7,500) and (iii)
any amendments, modifications or waivers of this Agreement or any of the other
Transaction Documents. 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 but only if the
Purchasers are successful in any litigation or arbitration relating to such
enforcement.


    
      
         


      

      
        25

        
          

        

      

      
         


      

    


    Section 8.2        
Specific
Enforcement. The Company
and the Purchasers acknowledge and agree that irreparable damage would occur in
the event that any of the provisions of this Agreement or the other Transaction
Documents were not performed in accordance with their specific terms or were
otherwise breached. It is accordingly agreed that the parties shall be entitled
to an injunction or injunctions to prevent or cure breaches of the provisions of
this Agreement and to enforce specifically the terms and provisions hereof or
thereof, this being in addition to any other remedy to which any of them may be
entitled by law or equity.

    


    Section 8.3      
  Entire
Agreement; Amendment. This
Agreement and the Transaction Documents contains the entire understanding and
agreement of the parties with respect to the matters covered hereby and, except
as specifically set forth herein or in the Transaction Documents, neither the
Company nor any of the Purchasers makes any representations, warranty, covenant
or undertaking with respect to such matters and they supersede all prior
understandings and agreements with respect to said subject matter, all of which
are merged herein. No provision of this Agreement may be waived or amended other
than by a written instrument signed by the Company and the holders of at least
a majority of the Notes then outstanding, and no provision
hereof may be waived other than by an a written instrument signed by the party
against whom enforcement of any such amendment or waiver is sought. No such
amendment shall be effective to the extent that it applies to less than all of
the holders of the Notes
then outstanding. No
consideration shall be offered or paid to any person to amend or consent to a
waiver or modification of any provision of any of the Transaction Documents
unless the same consideration is also offered to all of the parties to the
Transaction Documents or
holders of the Notes, as the case may be.

    


    Section
8.4         Rescission and Withdrawal
Right.    Notwithstanding anything to the contrary
contained in (and without limiting any similar provisions of) the Transaction
Documents, whenever any Purchaser exercises a material right, election, demand
or option under a Transaction Document and the Company does not timely perform
its related obligations within the periods therein provided, then such Purchaser
may rescind or withdraw, in its sole discretion from time to time upon written
notice to the Company, any relevant notice, demand or election in whole or in
part without prejudice to its future actions and rights.


    
      
         


      

      
        26

        
          

        

      

      
         


      

    

    
       

      Section 8.5       
  Notices. Any notice, demand, request, waiver or
other communication required or permitted to be given hereunder shall be in
writing and shall be effective (a) upon hand delivery or facsimile at the
address or number designated below (if delivered on a business day during normal
business hours where such notice is to be received), or the first business day
following such delivery (if delivered other than on a business day during normal
business hours where such notice is to be received) or (b) on the second
business day following the date of mailing by express courier service, fully
prepaid, addressed to such address, or upon actual receipt of such mailing,
whichever shall first occur. The addresses for such communications shall
be:

       

    

    
      
        
          	
                  If to the
      Company:

                	
                  Juma Technology
      Corp.

                  154 Toledo
      Street

                  Farmingdale, New York
      11735

                  Attention: Chief Executive
      Officer

                  Tel. No.: (631) 300-1000

                  Fax No.: (631) 270-1105

                    

                
	
                  with copies
    to:

                	
                  Gersten Savage
      LLP

                  600 Lexington Avenue,
      9th Floor

                  New York, New York
      10022

                  Attention: Jay Kaplowitz,
      Esq.

                  Tel. No.: (212) 752-9700

                  Fax No.: (212) 980-5192

                    

                
	
                  If to any
      Purchaser:

                	
                  At the address of such Purchaser
      set forth on Exhibit
      A to this Agreement,
      with copies to Purchaser’s counsel (which copies shall not
      constitute notice to such purchaser) as set forth on Exhibit
      A or as specified in
      writing by such Purchaser.

                    

                
	
                  with copies
    to:

                	
                  Sadis & Goldberg
      LLP

                  551 Fifth Avenue, 21st Floor

                  New York, New York
      10176

                  Attention: Paul Fasciano, Esq.

                  Tel.
      No.: (212) 573-8025

                  Fax
      No.: (212) 573-8026

                


        

      

    

    


     Any party hereto may from time to
time change its address for notices by giving at least ten (10) days written
notice of such changed address to the other parties hereto.

    


    Section 8.6      
  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.

    


    Section 8.7      
  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.


    
      
         


      

      
        27

        
          

        

      

      
         


      

    


    Section 8.8      
   Successors
and Assigns. This Agreement
shall be binding upon and inure to the benefit of the parties and their
successors and assigns.

    


    Section 8.9     
   No 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 (except as otherwise provided in
Article
VI).

    


    Section 8.10     
Governing
Law; Consent to
Jurisdiction. The
parties acknowledge and agree that any claim, controversy, dispute or action
relating in any way to this agreement or the subject matter of this agreement
shall be governed solely by the laws of the State of New York, without regard to
any conflict of laws doctrines.  The parties irrevocably consent to
being served with legal process issued from the state and federal courts located
in New York and irrevocably consent to the exclusive personal jurisdiction of
the federal and state courts situated in the State of New York.  The
parties irrevocably waive any objections to the personal jurisdiction of these
courts.  Said courts shall have sole and exclusive jurisdiction over
any and all claims, controversies, disputes and actions which in any way relate
to this agreement or the subject matter of this agreement.  The
parties also irrevocably waive any objections that these courts constitute an
oppressive, unfair, or inconvenient forum and agree not to seek to change venue
on these grounds or any other grounds. The parties hereby agree that the
prevailing party in any suit, action or proceeding arising out of or relating to
this Agreement, shall be entitled to reimbursement for reasonable legal fees
from the non-prevailing party. The parties hereby waive all rights to a trial by
jury. Nothing in this Section
8.10 shall affect or limit any right to serve
process in any other manner permitted by law.

    


    Section 8.11   
    Survival. The representations and warranties of
the Company and the Purchasers shall survive the execution and delivery
hereof and the Closing
hereunder.

    


    Section 8.12    
  Counterparts. This Agreement may be executed in any
number of counterparts, each of which when so executed shall be deemed to be an
original and all of which taken together shall constitute one and the same
Agreement, and shall become effective when counterparts have been signed by each
party and delivered to the other parties hereto, it being understood that all
parties need not sign the same counterpart. In the event that any signature is
delivered by facsimile or electronic mail transmission, such signature shall
create a valid binding obligation of the party executing (or on whose behalf
such signature is executed) the same with the same force and effect as if such
facsimile signature were the original thereof.

    


    Section 8.13     
 Publicity. The Company agrees that it will not
disclose, and will not include in any public announcement, the name of the
Purchasers without the consent of the Purchasers unless and until such
disclosure is required by law or applicable regulation, and then only to the
extent of such requirement.

    


    Section 8.14    
  Severability. The provisions of this Agreement and
the Transaction Documents are severable and, in the event that any court of
competent jurisdiction shall determine that any one or more of the provisions or
part of the provisions contained in this Agreement or the Transaction Documents
shall, for any reason, be held to be invalid, illegal or unenforceable in any
respect, such invalidity, illegality or unenforceability shall not affect any
other provision or part of a provision of this Agreement or the Transaction
Documents and such provision shall be reformed and construed as if such invalid
or illegal or unenforceable provision, or part of such provision, had never been
contained herein, so that such provisions would be valid, legal and enforceable
to the maximum extent possible.


    
      
         


      

      
        28

        
          

        

      

      
         


      

    


    Section 8.15    
 Further
Assurances. From and after
the date of this Agreement, upon the request of any Purchaser or the Company,
each of the Company and the Purchasers shall execute and deliver such
instrument, documents and other writings as may be reasonably necessary or
desirable to confirm and
carry out and to effectuate fully the intent and purposes of this Agreement, the
Notes, the Conversion
Shares, the Warrants, the
Warrant Shares and
any other Transaction Documents.

    


    [remainder of page
intentionally left blank]


    
      
         


      

      
        29

        
          

        

      

      
         


      

    

    


    IN WITNESS WHEREOF, the parties hereto
have caused this Agreement to be duly executed by their respective authorized
officer as of the date first above written.

    


    
      
        	 
      	
                JUMA TECHNOLOGY
      CORP.

              
	 
      	 
      	 
      
	 
      	
                By:

              	
                /s/ Anthony M. Servidio

              
	 
      	 
      	
                Name: Anthony M.
      Servidio

              
	 
      	 
      	
                Title:   Chief Executive
      Officer

              


      

    

    


    
      
        	 
      	
                NECTAR SERVICES
      CORP.

              
	 
      	 
      	 
      
	 
      	
                By:

              	
                /s/ Anthony M. Servidio

              
	 
      	 
      	
                Name: Anthony M.
      Servidio

              
	 
      	 
      	
                Title:   Chief Executive
      Officer

              


      

    

    


    
      
        	 
      	
                PURCHASER:

              
	 
      	 
      	 
      
	 
      	
                By:

              	
                /s/ Adam
      Benowitz

              
	 
      	 
      	
                Name: Adam
    Benowitz

              
	 
      	 
      	
                Title:   Director

              


      

    


    
      
         


      

      
        30

        
          

        

      

      
         


      

    


    EXHIBIT
A

    to
the

    NOTE
AND WARRANT STOCK PURCHASE AGREEMENT FOR

    JUMA TECHNOLOGY
CORP.


    


    
      	
              Names and Addresses of the
      Purchasers

            	 
      	
              Purchase Price

            	 
      	
              Notes & Warrants
    Purchased

            
	 
      	 
      	 
      	 
      	 
      
	
              Vision
      Opportunity Master Fund, Ltd.

              c/o
      Vision Capital Advisors, LLC

              20
      West 55th
      Street

              New
      York, NY 10019

              Attn:
      Robert Thomson

            	 
      	
              $3,000,000

            	 
      	
              $3,000,000
      principal amount of Note

               

              Series
      A Warrants: 10,000,000

               

            


    

    


    EXISTING NOTE
HOLDERS

    


    
      
        
          
            
              
                
                  	
                          Names and Addresses

                          of Existing Note Holders

                        	 	
                          Existing Note

                          Principal

                          Amount

                        	 	
                          Accrued and

                          Unpaid

                          Interest

                          Through the

                          Closing Date

                        	 	
                          Notes & Warrants Received

                        
	 
      	 	 
      	 	 
      	 	 
      
	
                          Vision
      Opportunity Master Fund, Ltd.

                          c/o
      Vision Capital Advisors, LLC

                          20
      West 55th
      Street

                          New
      York, NY 10019

                          Attn:
      Robert Thomson

                        	 	
                          $1,500,000

                        	 	
                          $42,500

                        	 	
                          $1,542,500
      principal amount of Note

                           

                          Series
      A Warrants: 5,141,667

                           

                        


                

              

            

          

        

      

    

    


    Exhibit A to Note and
Warrant Purchase Agreement


    
      
         


      

      
         


        
          

        

      

      
         


      

    


    EXHIBIT
B

    to
the

    NOTE
AND WARRANT STOCK PURCHASE AGREEMENT FOR

    JUMA TECHNOLOGY
CORP.

    


    FORM OF NOTE

    


    Exhibit B to Note and
Warrant Purchase Agreement


    
      
         


      

      
         


        
          

        

      

      
         


      

    


    EXHIBIT
C

    to
the

    NOTE
AND WARRANT STOCK PURCHASE AGREEMENT FOR

    JUMA TECHNOLOGY CORP.

    


    FORM
OF SERIES A WARRANT

    


    Exhibit C to Note and
Warrant Purchase Agreement



    
      
         


      

      
         


        
          

        

      

      
         


      

    


    EXHIBIT
D

    to
the

    NOTE
AND WARRANT PURCHASE AGREEMENT FOR

    JUMA TECHNOLOGY CORP.

    


    FORM OF IRREVOCABLE TRANSFER
AGENT INSTRUCTIONS

    


    [NAME AND ADDRESS OF TRANSFER
AGENT]

    Attn:
____________________________

    


    Re:  Juma
Technology Corp.

    


    Ladies
and Gentlemen:

    


    Reference
is made to that certain Note and Warrant Purchase Agreement (the “Purchase
Agreement”), dated as of May 21, 2009, by and among Juma Technology
Corp., a Delaware corporation (the “Company”),
and the purchasers named therein (collectively, the “Purchasers”)
pursuant to which the Company is issuing to the Purchasers 10% Convertible Bridge Notes (the “Notes”)
and warrants (the “Warrants”)
to purchase shares of the Company’s common stock, par value $0.0001 per share
(the “Common
Stock”). This letter shall serve as our irrevocable authorization and
direction to you provided that you are the transfer agent of the Company at such
time) to issue shares of Common Stock upon a conversion of the Notes (the “Conversion
Shares”) and exercise of the Warrants (the “Warrant
Shares”) to or upon the order of a Purchaser from time to time upon (i)
surrender to you of a properly completed and duly executed Conversion Notice or
Exercise Notice, as the case may be, in the form attached hereto as Exhibit I
and Exhibit II, respectively, (ii) in the case of the conversion of Notes, a
copy of the Note or, in the case of Warrants being exercised, a copy of the
Warrants (with the original Warrants delivered to the Company) being exercised
(or, in each case, an indemnification undertaking with respect to such share
certificates or the warrants in the case of their loss, theft or destruction),
and (iii) delivery of a treasury order or other appropriate order duly executed
by a duly authorized officer of the Company. So long as you have previously
received (x) written confirmation from counsel to the Company that a
registration statement covering resales of the Conversion Shares or Warrant
Shares, as applicable, has been declared effective by the Securities and
Exchange Commission (the “SEC”)
under the Securities Act of 1933, as amended (the “1933
Act”), and no subsequent notice by the Company or its counsel of the
suspension or termination of its effectiveness and (y) a copy of such
registration statement, and if the Purchaser represents in writing that the
Conversion Shares or the Warrant Shares, as the case may be, were sold pursuant
to the Registration Statement, then certificates representing the Conversion
Shares and the Warrant Shares, as the case may be, shall not bear any legend
restricting transfer of the Conversion Shares and the Warrant Shares, as the
case may be, thereby and should not be subject to any stop-transfer restriction.
Provided, however, that if you have not previously received those items and
representations listed above, then the certificates for the Conversion Shares
and the Warrant Shares shall bear the following legend:

     

    
      “THE
SECURITIES REPRESENTED BY THIS CERTIFICATE (THE “SECURITIES”) HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR APPLICABLE STATE SECURITIES
LAWS, AND MAY NOT BE SOLD, TRANSFERRED, OR OTHERWISE DISPOSED OF IN THE ABSENCE
OF SUCH REGISTRATION OR RECEIPT BY THE COMPANY OF A WRITTEN OPINION OF COUNSEL
IN FORM, SUBSTANCE AND SCOPE REASONABLY SATISFACTORY TO THE COMPANY THAT SUCH
SECURITIES MAY BE SOLD, TRANSFERRED,  OR OTHERWISE DISPOSED OF, UNDER
AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT AND SUCH STATE
SECURITIES LAWS.”

    

     

    Exhibit D to Note and
Warrant Purchase Agreement


    
      
         


      

      
         


        
          

        

      

      
         


      

    

    


    and,
provided further, that the Company may from time to time notify you to place
stop-transfer restrictions on the certificates for the Conversion Shares and the
Warrant Shares in the event a registration statement covering the Conversion Shares and the
Warrant Shares is subject to amendment for events then
current.

    


    A form of
written confirmation from counsel to the Company that a registration statement
covering resales of the Conversion Shares and the Warrant Shares has been
declared effective by the SEC under the 1933 Act is attached hereto as Exhibit
III.

    


    Please be
advised that the Purchasers are relying upon this letter as an inducement to
enter into the Purchase Agreement and, accordingly, each Purchaser is a third
party beneficiary to these instructions.

    


    Please
execute this letter in the space indicated to acknowledge your agreement to act
in accordance with these instructions. Should you have any questions concerning
this matter, please contact me at ___________.

    


    
      
        	 
      	
                 Very truly
      yours,

              
	 
      	 
      
	 
      	
                JUMA TECHNOLOGY
      CORP.

              
	 
      	 
      	 
      
	 
      	
                By:

              	
                  

              
	 
      	
                Name:

              
	 
      	
                Title:

              
	 
      	 
      


      

    

    


    
      
        	
                ACKNOWLEDGED AND
      AGREED:

              
	 
      
	
                [TRANSFER
      AGENT]

              
	 
      
	
                By:

              	
                  

              
	 
      	
                Name:

              
	 
      	
                Title:

              
	 
      	
                Date:

              


      

    

    


    Exhibit D to Note and
Warrant Purchase Agreement


    
      
         


      

      
         


        
          

        

      

      
         


      

    

    


    EXHIBIT
I

    CONVERSION
NOTICE

    JUMA TECHNOLOGY CORP.

    


    (To be
Executed by the Registered Holder in order to Convert the Note)

    


    In
accordance with and pursuant to the Note, the undersigned hereby elects to
convert the Note into such number of shares of Common stock, of Juma Technology
Corp., a Delaware corporation (the “Company”),
indicated below:

     

    Date of
Conversion:
__________________________________________________________

     

    Applicable
Conversion Price:
___________________________________________________

     

    Number of
shares of Common Stock beneficially owned or deemed beneficially owned by the
Holder on the date of Conversion

    


    
      
        
          
            
              
                
                  	
                          Dated:
      ____________________

                        	
                          Signature:

                        	
                            

                        	 
	 
      	 
      	 
      	 
	 
      	
                          Address:

                        	
                            

                        	 
	 
      	 
      	
                            

                        	 
	 
      	 
      	
                            

                        	 


                

              

            

          

        

      

    

    


    Exhibit D to Note and
Warrant Purchase Agreement


    
      
         


      

      
         


        
          

        

      

      
         


      

    


    EXHIBIT
II

    


    FORM
OF EXERCISE NOTICE

    JUMA TECHNOLOGY CORP.

    


    The
undersigned_______________, pursuant to the provisions of the within Warrant,
hereby elects to purchase ______ shares of Common Stock of Juma Technology Corp.
covered by the within Warrant.

    


    
      
        
          
            
              
                
                  	
                          Dated:
      ____________________

                        	
                          Signature:

                        	
                            

                        	 
	 
      	 
      	 
      	 
	 
      	
                          Address:

                        	
                            

                        	 
	 
      	 
      	
                            

                        	 
	 
      	 
      	
                            

                        	 


                

              

            

          

        

      

    

    


    Number of
shares of Common Stock beneficially owned or deemed beneficially owned by the
Holder on the date of Exercise:

    


    ASSIGNMENT

    


    FOR VALUE
RECEIVED, ______________________ hereby sells, assigns and transfers unto
_____________________ the within Warrant and all rights evidenced thereby and
does irrevocably constitute and appoint __________________________, attorney, to
transfer the said Warrant on the books of the within named
corporation.

    


    
      
        
          
            
              
                
                  	
                          Dated:
      ____________________

                        	
                          Signature:

                        	
                            

                        	 
	 
      	 
      	 
      	 
	 
      	
                          Address:

                        	
                            

                        	 
	 
      	 
      	
                            

                        	 
	 
      	 
      	
                            

                        	 


                

              

            

          

        

      

    

    


    PARTIAL
ASSIGNMENT

    


    FOR VALUE
RECEIVED, ______________________ hereby sells, assigns and transfers unto
_____________________ the right to purchase ___________________ shares of
Warrant Stock evidenced by the within Warrant together with all rights therein,
and does irrevocably constitute and appoint __________________________,
attorney, to transfer that part of the said Warrant on the books of the within
named corporation.

    


    
      
        
          
            
              
                
                  	
                          Dated:
      ____________________

                        	
                          Signature:

                        	
                            

                        	 
	 
      	 
      	 
      	 
	 
      	
                          Address:

                        	
                            

                        	 
	 
      	 
      	
                            

                        	 
	 
      	 
      	
                            

                        	 


                

              

            

          

        

      

    

    


    Exhibit D to Note and
Warrant Purchase Agreement


    
      
         


      

      
         


        
          

        

      

      
         


      

    


    FOR
USE BY THE ISSUER ONLY:

    


    This
Warrant No. W-__________ canceled (or transferred or exchanged) this _______ day
of ______________, _______, shares of Common Stock issued therefor in the name
of __________________________, Warrant No. W-_________ issued for ______________
shares of Common Stock in the name of ______________________.

    


    Exhibit D to Note and
Warrant Purchase Agreement


    
      
         


      

      
         


        
          

        

      

      
         


      

    


    EXHIBIT
III

    


    FORM
OF NOTICE OF EFFECTIVENESS

    OF
REGISTRATION STATEMENT

    


    [NAME AND ADDRESS OF TRANSFER
AGENT]

    Attn:
____________________________

    


    Re:  Juma
Technology Corp.

    


    Ladies
and Gentlemen:

    


    We are
special counsel to Juma Technology Corp., a Delaware corporation (the “Company”),
and have represented the Company in connection with that certain Note and
Warrant Purchase Agreement (the “Purchase
Agreement”), dated as of May 21, 2009, by and among the Company, Nectar
Services Corp. and the purchasers named therein (collectively, the “Purchasers”)
pursuant to which the Company issued to the Purchasers 10% convertible bridge
notes (the “Notes”)
and warrants (the “Warrants”)
to purchase shares of the Company’s common stock, par value $0.0001 per share
(the “Common
Stock”). Pursuant to the Purchase Agreement, the Company agreed, among
other things, in certain circumstances, to register the shares of Common Stock
issuable upon conversion of the Notes, and the shares of Common Stock issuable
upon exercise of the Warrants (the “Registrable
Securities”), under the Securities Act of 1933, as amended (the “1933
Act”). In connection with the Company’s obligations under the Purchase
Agreement, on ________________, 200_, the Company filed a Registration Statement
on Form S-1 (File No. 333-________) (the “Registration
Statement”) with the Securities and Exchange Commission (the “SEC”)
relating to the resale of the Registrable Securities which names each of the
present Purchasers as a selling stockholder thereunder.

    


    In
connection with the foregoing, we advise you that a member of the SEC’s staff
has advised us by telephone that the SEC has entered an order declaring the
Registration Statement effective under the 1933 Act at [ENTER TIME OF EFFECTIVENESS]
on [ENTER DATE OF
EFFECTIVENESS] and we have no knowledge, after telephonic inquiry of a
member of the SEC’s staff, that any stop order suspending its effectiveness has
been issued or that any proceedings for that purpose are pending before, or
threatened by, the SEC and accordingly, the Registrable Securities are available
for resale under the 1933 Act pursuant to the Registration
Statement.

    


    
      
        
          
            	
                    Very
      truly yours,

                  
	 
      
	
                    [COMPANY
      COUNSEL]

                  
	 
      	 
      
	
                    By:

                  	 
      


          

        

      

    

    


    cc: [LIST
NAMES OF PURCHASERS]

    


    Exhibit D to Note and
Warrant Purchase Agreement


    
      
         


      

      
         


        
          

        

      

      
         


      

    


    EXHIBIT
E

    to
the

    NOTE
AND WARRANT PURCHASE AGREEMENT FOR

    JUMA
TECHNOLOGY CORP.

    


    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, which the failure to so qualify could have a Material
Adverse Effect on the Company.

    


    2.  Each
of the Subsidiaries of the Company (the “Subsidiaries”)
set forth on Schedule
2.1(g) of the Note Purchase Agreement is a corporation or limited
liability company, as applicable, duly incorporated or organized and in good
standing under the laws of its state of incorporation or
organization.

    


    3.  The
Issuers have the requisite corporate power and authority to enter into and
perform its obligations under the Transaction Documents and, as applicable, to
issue the Notes, the Common Stock issuable upon conversion of the Notes, the
Warrants, and the Common Stock issuable upon exercise of the Warrants. The
execution, delivery and performance of each of the Transaction Documents by the
Issuers, as applicable, 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 any Issuer or its
board of directors or stockholders is required. Each of the Transaction
Documents have been duly executed and delivered, and the Notes and the Warrants
have been duly executed, issued and delivered by the Issuers party thereto and
each of the Transaction Documents constitutes a legal, valid and binding
obligation of the Issuers enforceable against it in accordance with its
respective terms. The Common Stock issuable upon conversion of the Notes and
exercise of the Warrants are not subject to any preemptive rights under the
Certificate of Incorporation or the Bylaws.  Nevertheless, we do not
opine as to whether Nectar Services has the authority to issue the common stock
under the Note or cause the conversion of the Note into common
stock.

    


    4. The
Notes and the Warrants have been duly authorized and, when delivered against
payment in full as provided in the Note Purchase Agreement, will be validly
issued, fully paid and nonassessable. The shares of Common Stock issuable upon
conversion of the Notes and the exercise of the Warrants, have been duly
authorized and reserved for issuance, and, based on the facts and circumstance
as they exist on the date of this opinion and the qualifications contained
herein, when delivered upon conversion, exercise or payment in full as provided
in the Notes and the Warrants, will be validly issued, fully paid and
nonassessable.

    


    Exhibit E to Note and
Warrant Purchase Agreement


    
      
         


      

      
         


        
          

        

      

      
         


      

    


    5. The
execution, delivery and performance of and compliance with the terms of the
Transaction Documents and the issuance of Notes, the Common Stock issuable upon
conversion of the Notes, the Warrants, and the Common Stock issuable upon the
exercise of the Warrants, do not (i) violate any provision of the Certificate of
Incorporation or By-Laws of such Issuer, as applicable, (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 such Issuer is a party, and which agreement, mortgage, deed
of trust, indenture, note, bond, license, lease agreement, instrument or
obligation has been disclosed in the Commission Documents, (iii) to our
knowledge, create or impose a lien, charge or encumbrance on any property of
such Issuer under any agreement or any commitment to which such Issuer is a
party or by which such Issuer is bound or by which any of its respective
properties or assets are bound and, in each case, which agreement or commitment
has been disclosed in the Commission Documents, or (iv) result in a violation of
any federal, state, or local statute, rule, regulation (including federal and
state securities laws and regulations) or any order, judgment, injunction or
decree known to us applicable to such Issuer or by which any property or asset
of such Issuer is bound or affected, except, in all of the foregoing cases
(other than (i)) for such conflicts, default, terminations, amendments,
acceleration, cancellations and violations as would not, individually or in the
aggregate, have a Material Adverse Effect.

    


    6. Based
on the representations of Purchaser contained in the Note Purchase Agreement and
subject to compliance with the filing requirements under the applicable “blue
sky” laws and Regulation D promulgated under the Securities Act of 1933, as
amended, 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 Notes, the Warrants or the Common Stock issuable upon conversion
of the Notes and exercise of the Warrants or the consummation of the
transactions contemplated by the Note Purchase Agreement other than as may be
required under the Registration Statement.

    


    7. To our
knowledge, there is no action, suit, claim, or proceeding pending or threatened
against any Issuer which questions the validity of the Transaction Documents or
the transactions contemplated thereby or any action taken or to be taken
pursuant thereto. To our knowledge, there is no action, suit, claim, or
proceeding pending or threatened against such Issuer or any of its properties or
assets and which, if adversely determined, is reasonably likely to result in a
Material Adverse Effect. To our knowledge, there are no outstanding orders,
judgments, injunctions, awards or decrees of any court, arbitrator or
governmental or regulatory body against such Issuer or any officers or directors
of any Issuer in their capacities as such.

     

    8. Based
upon the representations of the Purchaser, the offer, issuance and sale of the
Notes and the Warrants and, based on the facts and circumstances as they exist
on the date of this opinion, the offer, issuance and sale of the shares of
Common Stock issuable upon conversion of the Notes and the Common Stock issuable
upon exercise of the Warrants pursuant to the Note Purchase Agreement, the
Notes, and the Warrants, as applicable, are exempt from the registration
requirements of the Securities Act.

    


    9. No
Issuer is, and as a result of and immediately upon the Closing no Issuer will
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,

                
	 
      
	
                  [COMPANY
      COUNSEL]

                
	 
      	 
      
	
                  By:

                	 
      


        

      

    

    


    Exhibit E to Note and
Warrant Purchase Agreement