exv10w2






SECURITIES PURCHASE AGREEMENT




     This
Securities Purchase Agreement (this “Agreement”) is dated
as of November 20, 2008, among
Escalon Medical Corp., a Pennsylvania corporation (the “Company”), and each purchaser identified on
the signature pages hereto (each, including its successors and assigns, a “Purchaser” and
collectively the “Purchasers”); and



     WHEREAS, subject to the terms and conditions set forth in this Agreement and pursuant to
Section 4(2) of the Securities Act (as defined below), and Rule 506 promulgated thereunder, the
Company desires to issue and sell to each Purchaser, and each Purchaser, severally and not jointly,
desires to purchase from the Company shares of Common Stock and Warrants on the Closing Date.



     NOW, THEREFORE, in consideration of the mutual covenants contained in this Agreement, and for
other good and valuable consideration the receipt and adequacy of which are hereby acknowledged,
the Company and each Purchaser agrees as follows:



ARTICLE I

DEFINITIONS




     1.1. Definitions. In addition to the terms defined elsewhere in this Agreement, for
all purposes of this Agreement, the following terms have the meanings indicated in this Section
1.1:




     “Affiliate” means any Person that, directly or indirectly through one or more
intermediaries, controls or is controlled by or is under common control with a Person as
such terms are used in and construed under Rule 144. With respect to a Purchaser, any
investment fund or managed account that is managed on a discretionary basis by the same
investment manager as such Purchaser will be deemed to be an Affiliate of such Purchaser.




     “Closing” means the closing of the purchase and sale of the Common Stock
pursuant to Section 2.1.




     “Closing Date” means the Trading Day when all of the Transaction Documents have
been executed and delivered by the applicable parties thereto, and all conditions precedent
to (i) the Purchasers’ obligations to pay the Subscription Amount and (ii) the Company’s
obligations to deliver the Shares have been satisfied or waived.




     “Commission” means the United States Securities and Exchange Commission.




     “Common Stock” means the common stock of the Company, $0.001 par value per
share.




     “Effective Date” means the date that the Registration Statement is first
declared effective by the Commission.



 









 






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




     “Liens” means a lien, charge, security interest, encumbrance, right of first
refusal, preemptive right or other restriction.




     “Material Adverse Effect” shall have the meaning ascribed to such term in
Section 3.1(b).




     “Per Share Purchase Price” equal to the average closing price of the Company’s
common stock on the NASDAQ Capital Market for the ten trading days immediately preceding the
Closing Date, subject to adjustment for stock splits, stock dividends, stock combinations
and other similar transactions of the Common Stock that occur after the date of this
Agreement but prior to the Closing Date.




     “Person” means an individual or corporation, partnership, trust, incorporated
or unincorporated association, joint venture, limited liability company, joint stock
company, government (or an agency or subdivision thereof) or other entity of any kind.




     “Principal Market” initially means the NASDAQ Capital Market and shall also
include the New York Stock Exchange, the Nasdaq National Market or the NYSE Alternext U.S.,
whichever is at the time the principal trading exchange or market for the Common Stock,
based upon share volume.




     “Proceeding” means an action, claim, suit, investigation or proceeding
(including, without limitation, an investigation or partial proceeding, such as a
deposition), whether commenced or threatened.




     “Registration Rights Agreement” means the Registration Rights Agreement, dated
as of the date of this Agreement, among the Company and each Purchaser, in the form of
Exhibit A hereto.




     “Registration Statement” means a registration statement meeting the
requirements set forth in the Registration Rights Agreement and covering the resale by the
Purchasers of the Shares and the Warrant Shares.




     “Required Approvals” shall have the meaning ascribed to such term in Section
3.1(e).




     “Rule 144” means Rule 144 promulgated by the Commission pursuant to the
Securities Act, as such Rule may be amended from time to time, or any similar rule or
regulation hereafter adopted by the Commission having substantially the same effect as such
Rule.




     “SEC Reports” shall have the meaning ascribed to such term in Section 3.1(g).




     “Securities Act” means the Securities Act of 1933, as amended.



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     “Shares” means the shares of Common Stock issued or issuable to each Purchaser
pursuant to this Agreement.




     “Subscription Amount” means, as to each Purchaser, the amounts set forth below
such Purchaser’s signature block on the signature page hereto, in United States dollars and
in immediately available funds.




     “Subsidiary” shall mean the subsidiaries of the Company, if any, referenced in
Section 3.1(a).




     “Trading Day” means a day on which the Common Stock is traded on a Principal
Market.




     “Transaction Documents” means this Agreement, the Registration Rights
Agreement, any Warrants and any other documents or agreements executed in connection with
the transactions contemplated hereunder.




     “Warrants” means the warrants issued to each Purchaser to purchase shares of
Common Stock, in the form of Exhibit B hereto.




     “Warrant Shares” means the shares of Common Stock issuable upon exercise of the
Warrants.



ARTICLE II

PURCHASE AND SALE




     2.1. Closing. On the Closing Date, each Purchaser shall purchase from the Company,
severally and not jointly with the other Purchasers, and the Company shall issue and sell to each
Purchaser, the following: (a) the number of Shares equal to such Purchaser’s Subscription Amount
divided by the Per Share Purchase Price and (b) Warrants to purchase shares of the Companies Common
Stock equal to fifteen percent (15%) of the Shares purchased by Purchaser at Closing (adjusted for
any stock splits, stock dividends, stock combinations and other similar transactions) exercisable
at a per share purchase price of $1.21. The aggregate amount of Shares sold hereunder shall be up
to 1,000,000 Shares plus up to 150,000 additional shares to be issued pursuant to the Warrants.
Upon satisfaction of the conditions set forth in Section 2.2, the Closing shall occur at the
offices of the Company or such other location as the parties shall mutually agree.



     2.2. Closing Conditions; Deliveries



          (a) On the Closing Date, the Company shall deliver or cause to be delivered to each Purchaser
the following:




               (i) this Agreement duly executed by the Company;



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               (ii) a copy of the irrevocable instructions to the Company’s transfer agent instructing the
transfer agent to deliver, on an expedited basis, a certificate evidencing the number of Shares
equal to such Purchaser’s Subscription Amount divided by the Per Share Purchase Price, registered
in the name of such Purchaser; and



               (iii) the Registration Rights Agreement duly executed by the Company.



          (b) On the Closing Date, each Purchaser shall deliver or cause to be delivered to the Company
the following:




               (i) this Agreement duly executed by such Purchaser;



               (ii) such Purchaser’s Subscription Amount by wire transfer to the account as specified in
writing by the Company; and



               (iii) the Registration Rights Agreement duly executed by such Purchaser.



          (c) The obligations of the parties are subject to the following additional conditions:




               (i) All representations and warranties of the other party contained herein shall remain true
and correct as of the Closing Date and all covenants of the other party shall have been performed
if due prior to such date.



               (ii) From the date hereof to the Closing Date, trading in the Common Stock shall not have been
suspended by the Commission (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 the NASDAQ Stock Market shall not
have been suspended or limited, or minimum prices shall not have been established on securities
whose trades are reported by such service, or on any Principal Market, 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 of such magnitude in its effect on, or any material adverse change in, any
financial market which, in each case, in the reasonable judgment of each Purchaser, makes it
impracticable or inadvisable to purchase the Shares at the Closing.



               (iii) There shall not then be in effect any legal or other order enjoining or restraining the
transactions contemplated by this Agreement.



               (iv) There shall not be in effect any law, rule or regulation prohibiting or restricting such
sale or requiring any consent or approval of any person to issue the Shares which consent or
approval shall not have been obtained (except as may otherwise be provided in this Agreement).



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ARTICLE III

REPRESENTATIONS AND WARRANTIES




     3.1. Representations and Warranties of the Company. Except as set forth in the SEC
Reports, the Company hereby makes the representations and warranties set forth below to each
Purchaser:



          (a) Subsidiaries. All of the direct and indirect subsidiaries of the Company are
referenced in the SEC Reports. The Company owns, directly or indirectly, all of the capital stock
or other equity interests of each Subsidiary free and clear of any Liens, and all the issued and
outstanding shares of capital stock of each Subsidiary are validly issued and are fully paid,
non-assessable and free of preemptive and similar rights to subscribe for or purchase securities.




          (b) Organization and Qualification. Each of the Company and the Subsidiaries is an
entity duly incorporated or otherwise organized, validly existing and in good standing under the
laws of the jurisdiction of its incorporation or organization (as applicable), with the requisite
power and authority to own and use its properties and assets and to carry on its business as
currently conducted. Neither the Company nor any Subsidiary is in violation or default of any of
the provisions of its respective certificate or articles of incorporation, bylaws or other
organizational or charter documents. Each of the Company and the Subsidiaries is duly qualified to
conduct business and is in good standing as a foreign corporation or other entity in each
jurisdiction in which the nature of the business conducted or property owned by it makes such
qualification necessary, except where the failure to be so qualified or in good standing, as the
case may be, could not have or reasonably be expected to result in (i) a material adverse effect on
the legality, validity or enforceability of any Transaction Document, (ii) a material adverse
effect on the results of operations, assets, business, prospects or financial condition of the
Company and the Subsidiaries, taken as a whole, or (iii) a material adverse effect on the Company’s
ability to perform in any material respect on a timely basis its obligations under any Transaction
Document (any of (i), (ii) or (iii), a “Material Adverse Effect”) and no Proceeding has been
instituted in any such jurisdiction revoking, limiting or curtailing or seeking to revoke, limit or
curtail such power and authority or qualification.




          (c) Authorization; Enforcement. The Company has the requisite corporate power and
authority to enter into and to consummate the transactions contemplated by each of the Transaction
Documents and otherwise to carry out its obligations thereunder. The execution and delivery of
each of the Transaction Documents by the Company and the consummation by it of the transactions
contemplated thereby have been duly authorized by all necessary action on the part of the Company
and no further action is required by the Company in connection therewith other than in connection
with the Required Approvals. Each Transaction Document has been (or upon delivery will have been)
duly executed by the Company and, when delivered in accordance with the terms hereof, will
constitute the valid and binding obligation of the Company enforceable against the Company in
accordance with its terms except (i) as limited by applicable bankruptcy, insolvency,
reorganization, moratorium and other laws of general application affecting enforcement of
creditors’ rights generally, (ii) as limited by laws relating to the availability of specific
performance, injunctive relief or other equitable remedies and (iii) insofar as indemnification and
contribution provisions may be limited by applicable law.




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          (d) No Conflicts. The execution, delivery and performance of the Transaction
Documents by the Company, the issuance and sale of the Shares and the consummation by the Company
of the other transactions contemplated thereby do not and will not (i) conflict with or violate any
provision of the Company’s or any Subsidiary’s certificate or articles of incorporation, bylaws or
other organizational or charter documents, or (ii) conflict with, or constitute a default (or an
event that with notice or lapse of time or both would become a default) under, result in the
creation of any Lien upon any of the properties or assets of the Company or any Subsidiary, or give
to others any rights of termination, amendment, acceleration or cancellation (with or without
notice, lapse of time or both) of, any agreement, credit facility, debt or other instrument
(evidencing a Company or Subsidiary debt or otherwise) or other understanding to which the Company
or any Subsidiary is a party or by which any property or asset of the Company or any Subsidiary is
bound or affected, or (iii) subject to the Required Approvals, conflict with or result in a
violation of any law, rule, regulation, order, judgment, injunction, decree or other restriction of
any court or governmental authority to which the Company or a Subsidiary is subject (including
federal and state securities laws and regulations), or by which any property or asset of the
Company or a Subsidiary is bound or affected; except in the case of each of clauses (ii) and (iii),
such as could not have or reasonably be expected to result in a Material Adverse Effect.




          (e) Filings, Consents and Approvals. The Company is not required to obtain any
consent, waiver, authorization or order of, give any notice to, or make any filing or registration
with, any court or other federal, state, local or other governmental authority or other Person in
connection with the execution, delivery and performance by the Company of the Transaction
Documents, other than (i) filings required pursuant to Section 4.4 of this Agreement, (ii) the
filing with the Commission of the Registration Statement, (iii) application(s) to each applicable
Principal Market for the listing of the Shares and the Warrant Shares for trading thereon in the
time and manner required thereby, and (iv) the filing of Form D with the Commission and such
filings as are required to be made under applicable state securities laws (collectively, the
“Required Approvals”).




          (f) Issuance of the Shares. The Shares are, and on each date on which the Warrants
are exercised the Warrant Shares shall be duly authorized and, when issued and paid for in
accordance with the Transaction Documents, will be duly and validly issued, fully paid and
nonassessable, free and clear of all Liens imposed by the Company other than restrictions on
transfer provided for in the Transaction Documents. The Company has reserved from its duly
authorized capital stock the maximum number of shares of Common Stock issuable pursuant to this
Agreement. The issuance and sale of the Shares, Warrants or Warrant Shares contemplated hereby
will not give rise to any preemptive rights or rights of first refusal on behalf of any Person.




          (g) SEC Reports; Financial Statements. The Company has filed all reports required to
be filed by it under the Securities Act and the Exchange Act, including pursuant to Section 13(a)
or 15(d) thereof, for the one year preceding the date hereof (or such shorter period as the Company
was required by law to file such material) (the foregoing materials, including the exhibits
thereto, being collectively referred to herein as the “SEC Reports”) on a timely basis or




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has received a valid extension of such time of filing and has filed any such SEC Reports prior
to the expiration of any such extension. As of their respective dates, the SEC Reports complied in
all material respects with the requirements of the Securities Act and the Exchange Act and the
rules and regulations of the Commission promulgated thereunder, and none of the SEC Reports, when
filed, 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 SEC Reports comply in all material respects with applicable accounting requirements
and the rules and regulations of the Commission with respect thereto as in effect at the time of
filing. Such financial statements have been prepared in accordance with United States generally
accepted accounting principles applied on a consistent basis during the periods involved (“GAAP”),
except as may be otherwise specified in such financial statements or the notes thereto and except
that unaudited financial statements may not contain all footnotes required by GAAP, and fairly
present in all material respects the financial position of the Company and its consolidated
subsidiaries as of and for 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, immaterial, year-end
audit adjustments.




          (h) Material Changes. Since the date of the latest audited financial statements
included within the SEC Reports, except as specifically disclosed in the SEC Reports, there has
been no event, occurrence or development that has had or that could reasonably be expected to
result in a Material Adverse Effect.




          (i) Sarbanes-Oxley; Internal Accounting Controls. The Company is in material
compliance with all provisions of the Sarbanes-Oxley Act of 2002 and the rules promulgated there
under which are applicable to it as of the Closing Date.




          (j) Certain Fees. Except for Barrett & Company (“Placement Agent”), no brokerage or
finder’s fees or commissions are or will be payable by the Company to any broker, financial advisor
or consultant, finder, placement agent, investment banker, bank or other Person with respect to the
transactions contemplated by this Agreement.




          (k) Private Placement. Assuming the accuracy of each Purchaser’s representations and
warranties set forth in Section 3.2, no registration under the Securities Act is required for the
offer and sale of the Shares or the Warrants by the Company to the Purchasers as contemplated
hereby. The issuance and sale of the Shares and the Warrants hereunder does not contravene the
rules and regulations of the Principal Market.




          (l) Investment Company. The Company is not, and is not an Affiliate of, and
immediately after receipt of payment for the Shares, will not be or be an Affiliate of, an
“investment company” within the meaning of the Investment Company Act of 1940, as amended.




          (m) Listing and Maintenance Requirements. The Company’s Common Stock is registered
pursuant to Section 12 of the Exchange Act, and the Company has taken no action




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designed to, or which to its knowledge is likely to have the effect of, terminating the
registration of the Common Stock under the Exchange Act nor has the Company received any
notification that the Commission is contemplating terminating such registration. The Company has
not, in the 12 months preceding the date hereof, received notice from any Principal 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 Principal Market. The Company is,
and has no reason to believe that it will not in the foreseeable future continue to be, in
compliance in all material respects with all such listing and maintenance requirements.




          (n) Application of Takeover Protections. The Company and its Board of Directors have
taken all necessary action, if any, in order to render inapplicable to the issuance of the Shares
and the Warrant Shares 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 Certificate of Incorporation (or similar charter documents) or the laws of its state of
incorporation that is or could become applicable to the Purchasers as a result of the Purchasers
and the Company fulfilling their obligations or exercising their rights under the Transaction
Documents.




          (o) Disclosure. The Company confirms that, neither the Company nor any other Person
acting on its behalf has provided any of the Purchasers or their agents or counsel with any
information that constitutes or might constitute material, non-public information. The Company
understands and confirms that the Purchasers will rely on the foregoing representations and
covenants in effecting transactions in securities of the Company. The Company acknowledges and
agrees that no Purchaser makes or has made any representations or warranties with respect to the
transactions contemplated hereby other than those specifically set forth in Section 3.2 hereof.




          (p) No Integrated Offering. Assuming the accuracy of the Purchasers’ representations
and warranties set forth in Section 3.2, 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 this
offering of the Shares to be integrated with prior offerings by the Company for purposes of the
Securities Act or any applicable shareholder approval provisions, including, without limitation,
under the rules and regulations of any exchange or automated quotation system on which any of the
securities of the Company are listed or designated.




          (q) Form S-3 Eligibility. The Company is eligible to register the resale of its
Common Stock by the Purchasers on Form S-3 promulgated under the Securities Act and the Company
hereby covenants and agrees to use its best efforts to maintain its eligibility to use Form S-3
until the Registration Statement covering the resale of the Shares and the Warrant Shares shall
have been filed with, and declared effective by, the Commission.




          (r) General Solicitation. Neither the Company nor any person acting on behalf of the
Company has offered or sold any of the Shares or Warrants by any form of general solicitation or
general advertising. The Company has offered the Shares and the Warrants for




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sale only to the Purchasers and certain other “accredited investors” within the meaning of
Rule 501 under the Securities Act.




          (s) Acknowledgment Regarding Purchasers’ Purchase of Shares. The Company acknowledges
and agrees that each of the Purchasers is acting solely in the capacity of an arm’s length
purchaser with respect to the Transaction Documents and the transactions contemplated hereby. The
Company further acknowledges that no Purchaser is acting as a financial advisor or fiduciary of the
Company (or in any similar capacity) with respect to this Agreement and the transactions
contemplated hereby and any advice given by any Purchaser or any of their respective
representatives or agents in connection with this Agreement and the transactions contemplated
hereby is merely incidental to the Purchasers’ purchase of the Shares and Warrants. The Company
further represents to each Purchaser that the Company’s decision to enter into this Agreement has
been based solely on the independent evaluation of the transactions contemplated hereby by the
Company and its representatives.




     3.2. Representations and Warranties of the Purchasers. Each Purchaser hereby, for
itself and for no other Purchaser, represents and warrants as of the date hereof and as of the
Closing Date to the Company as follows:



          (a) Organization; Authority. Such Purchaser is an entity duly organized, validly
existing and in good standing under the laws of the jurisdiction of its organization with full
right, corporate or partnership power and authority to enter into and to consummate the
transactions contemplated by the Transaction Documents and otherwise to carry out its obligations
thereunder. The execution, delivery and performance by such Purchaser of the transactions
contemplated by this Agreement have been duly authorized by all necessary corporate or similar
action on the part of such Purchaser. Each Transaction Document to which it is a party has been
duly executed by such Purchaser, and when delivered by such Purchaser in accordance with the terms
hereof, will constitute the valid and legally binding obligation of such Purchaser, enforceable
against it in accordance with its terms, except (i) as limited by general equitable principles and
applicable bankruptcy, insolvency, reorganization, moratorium and other laws of general application
affecting enforcement of creditors’ rights generally, (ii) as limited by laws relating to the
availability of specific performance, injunctive relief or other equitable remedies and (iii)
insofar as indemnification and contribution provisions may be limited by applicable law.




          (b) No Conflicts. The execution, delivery and performance of the Transaction
Documents by such Purchaser, the issuance and sale of the Shares to such Purchaser and the
consummation by such Purchaser of the other transactions contemplated thereby do not and will not
(i) conflict with or violate any provision of such Purchaser’s certificate or articles of
incorporation, bylaws or other organizational or charter documents, or (ii) subject to the Required
Approvals, conflict with or result in a violation of any law, rule, regulation, order, judgment,
injunction, decree or other restriction of any court or governmental authority to which such
Purchaser is subject (including federal and state securities laws and regulations), or by which any
property or asset of such Purchaser is bound or affected.




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          (c) Investment Intent. Such Purchaser understands that the Shares, Warrants and
Warrant Shares are “restricted securities” and have not been registered under the Securities Act or
any applicable state securities law and is acquiring such securities as principal for its own
account for investment purposes only and not with a view to or for distributing or reselling such
securities or any part thereof, has no present intention of distributing any of such securities and
has no arrangement or understanding with any other persons regarding the distribution of such
securities (this representation and warranty not limiting such Purchaser’s right to sell such
securities pursuant to the Registration Statement or otherwise in compliance with applicable
federal and state securities laws). Such Purchaser is acquiring such securities hereunder in the
ordinary course of its business. Such Purchaser does not have any agreement or understanding,
directly or indirectly, with any Person to distribute any of such securities.




          (d) Purchaser Status. At the time such Purchaser was offered the Shares, Warrants and
Warrant Shares it was, at the date hereof and on each date on which it exercises any of the
Warrants it will be, either: (i) an “accredited investor” as defined in Rule 501(a)(1), (a)(2),
(a)(3), (a)(7) or (a)(8) under the Securities Act or (ii) a “qualified institutional buyer” as
defined in Rule 144A(a) under the Securities Act. Such Purchaser is not required to be registered
as a broker-dealer under Section 15 of the Exchange Act.




          (e) Experience of Such Purchaser. Such Purchaser, either alone or together with its
representatives, has such knowledge, sophistication and experience in business and financial
matters so as to be capable of evaluating the merits and risks of the prospective investment in the
Shares, Warrants and Warrant Shares, and has so evaluated the merits and risks of such investment.
Such Purchaser is able to bear the economic risk of an investment in securities and, at the present
time, is able to afford a complete loss of such investment.




          (f) General Solicitation. Such Purchaser is not purchasing the Shares, Warrants and
Warrant Shares as a result of any advertisement, article, notice or other communication regarding
such securities published in any newspaper, magazine or similar media or broadcast over television
or radio or presented at any seminar or any other general solicitation or general advertisement.




          (g) Ownership of Company Stock. The purchase by each Purchaser of the Shares,
Warrants and Warrant Shares issuable to it at the Closing will not result in such Purchaser
(individually or together with other Persons with whom such Purchaser has identified, or will have
identified, itself as part of a “group” in a public filing made with the Commission involving the
Company’s securities) acquiring, or obtaining the right to acquire, in excess of 9.999% of the
Common Stock or the voting power of the Company on a post-transaction basis that assumes that the
Closing shall have occurred.




     The Company acknowledges and agrees that each Purchaser does not make or has not made any
representations or warranties with respect to the transactions contemplated hereby other than those
specifically set forth in this Section 3.2.



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ARTICLE IV

OTHER AGREEMENTS OF THE PARTIES




     4.1. Transfer Restrictions.



          (a) The Shares, Warrants and Warrant Shares may only be disposed of in compliance with state
and federal securities laws. In connection with any transfer of such securities other than
pursuant to an effective registration statement or Rule 144 to the Company or to an Affiliate of a
Purchaser or in connection with a pledge as contemplated in Section 4.1(b), the Company may require
the transferor thereof to provide to the Company an opinion of counsel selected by the transferor
and reasonably acceptable to the Company, the form and substance of which opinion and shall be
reasonably satisfactory to the Company, to the effect that such transfer does not require
registration of such transferred Shares, Warrants or Warrant Shares under the Securities Act. As a
condition of transfer, any such transferee shall agree in writing to be bound by the terms of this
Agreement and shall have the rights of a Purchaser under this Agreement and the Registration Rights
Agreement.




          (b) The Purchasers agree to the imprinting, so long as is required by this Section 4.1(b), of
a legend on any of the Shares or Warrant Shares in the following form:





THESE SECURITIES HAVE NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE
SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE
OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES
ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE
SECURITIES LAWS AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO THE TRANSFEROR TO SUCH EFFECT,
THE SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE COMPANY. THESE SECURITIES MAY
BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT WITH A REGISTERED BROKER-DEALER OR
OTHER LOAN WITH A FINANCIAL INSTITUTION THAT IS AN “ACCREDITED INVESTOR” AS DEFINED IN RULE
501(a) UNDER THE SECURITIES ACT.



     The Company acknowledges and agrees that a Purchaser may from time to time pledge pursuant to
a bona fide margin agreement with a registered broker-dealer or grant a security interest in some
or all of the Shares, Warrants or Warrant Shares to a financial institution that is an “accredited
investor” as defined in Rule 501(a) under the Securities Act and who agrees to be bound by the
provisions of this Agreement and the Registration Rights Agreement and, if required under the terms
of such arrangement, such Purchaser may transfer, pledged or secured, such securities to the
pledgees or secured parties. Such a pledge or transfer would not be subject to approval of the
Company and no legal opinion of legal counsel of the pledgee, secured party or pledgor shall be
required in connection therewith. Further, no notice shall be required of such pledge. At the
appropriate Purchaser’s expense, the Company will execute and deliver such



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reasonable documentation as a pledgee or secured party of Shares, Warrants or Warrant Shares may
reasonably request in connection with a pledge or transfer of such securities, including, if the
Shares or Warrant Shares are subject to registration pursuant to the Registration Rights Agreement,
the preparation and filing of any required prospectus supplement under Rule 424(b)(3) under the
Securities Act or other applicable provision of the Securities Act to appropriately amend the list
of Selling Shareholders thereunder.



          (c) Certificates evidencing the Shares or Warrant Shares shall not contain any legend
(including the legend set forth in Section 4.1(b)), (i) while a registration statement (including
the Registration Statement) covering the resale of such securities is effective under the
Securities Act, or (ii) following any sale of such Shares or Warrant Shares pursuant to Rule 144,
or (iii) if such Shares or Warrant Shares are eligible for sale under the final sentence of Rule
144(b)(1)(i), or (iv) if such legend is not required under applicable requirements of the
Securities Act (including judicial interpretations and pronouncements issued by the Staff of the
Commission). The Company shall cause its counsel to issue a legal opinion to the Company’s
transfer agent promptly after the Effective Date if required by the Company’s transfer agent to
effect the removal of the legend hereunder. The Company agrees that following the Effective Date
or at such time as such legend is no longer required under this Section 4.1(c), it will, no later
than three Trading Days following the delivery by a Purchaser to the Company or the Company’s
transfer agent of a certificate representing Shares and Warrant Shares, as the case may be, issued
with a restrictive legend (such date, the “Legend Removal Date”), deliver or cause to be delivered
to such Purchaser a certificate representing such Shares and Warrant Shares that is free from all
restrictive and other legends. The Company may not make any notation on its records or give
instructions to any transfer agent of the Company that enlarge the restrictions on transfer set
forth in this Section.




          (d) Each Purchaser, severally and not jointly with the other Purchasers, agrees that the
removal of the restrictive legend from certificates representing Shares and Warrant Shares as set
forth in this Section 4.1 is predicated upon the Company’s reliance that the Purchaser will sell
any Shares or Warrant Shares pursuant to either the registration requirements of the Securities
Act, including any applicable prospectus delivery requirements, or an exemption therefrom.




          (e) Until the date that each Purchaser holds less than 20% of the Shares and Warrant Shares
purchased hereunder by such Purchaser, the Company shall not undertake a reverse or forward stock
split or reclassification of the Common Stock without the prior written consent of the Purchasers
holding a majority in interest of the Shares and Warrant Shares.




     4.2. Furnishing of Information. As long as any Purchaser owns Shares, 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. As long as any Purchaser owns Shares, if the Company is not required to file reports
pursuant to the Exchange Act, 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 Shares under Rule 144. The Company further covenants that it will take such further action as
any holder of Shares may reasonably request, all to the extent required



12









 







from time to time to enable such Person to sell such Shares without registration under the
Securities Act within the limitation of the exemptions provided by Rule 144.



     4.3. Integration. The Company shall not sell, offer for sale or solicit offers to buy
or otherwise negotiate in respect of any security (as defined in Section 2 of the Securities Act)
that would be integrated with the offer or sale of the Shares in a manner that would require the
registration under the Securities Act of the sale of the Shares to the Purchasers or that would be
integrated with the offer or sale of the Shares for purposes of the rules and regulations of any
Principal Market such that it would require shareholder approval prior to the closing of such other
transaction unless shareholder approval is obtained before the closing of such subsequent
transaction.



     4.4. Securities Laws Disclosure; Publicity. The Company shall, by 8:30 a.m. Eastern
time on the Trading Day following the date hereof, issue a press release or file a Current Report
on Form 8-K, in each case reasonably acceptable to the Placement Agent disclosing the material
terms of the transactions contemplated hereby. The Company and the Placement Agent shall consult
with each other in issuing any other press releases with respect to the transactions contemplated
hereby, and neither the Company nor any Purchaser shall issue any such press release or otherwise
make any such public statement without the prior consent of the Company, with respect to any press
release of any Purchaser, or without the prior consent of the Placement Agent, with respect to any
press release of the Company, which consent shall not unreasonably be withheld, except if such
disclosure is required by law, in which case the disclosing party shall promptly provide the other
party with prior notice of such public statement or communication. Notwithstanding the foregoing,
the Company shall not publicly disclose the name of any Purchaser, or include the name of any
Purchaser in any filing with the Commission or any regulatory agency or Principal Market, without
the prior written consent of such Purchaser, except (i) as required by federal securities law in
connection with the registration statement contemplated by the Registration Rights Agreement and
reports filed by the Company under the Exchange Act and (ii) to the extent such disclosure is
required by law or Principal Market regulations, in which case the Company shall provide the
Purchasers with prior notice of such disclosure permitted under subclause (i) or (ii).



     4.5. Non-Public Information. The Company covenants and agrees that neither it nor any
other Person acting on its behalf will provide any Purchaser or its agents or counsel with any
information that the Company believes constitutes material non-public information, 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.



     4.6. Reimbursement. If any Purchaser or Placement Agent becomes involved in any
capacity in any Proceeding by or against any Person who is a shareholder of the Company (except as
a result of sales, pledges, margin sales and similar transactions by such Purchaser to or with any
current shareholder), solely as a result of such Purchaser’s acquisition of the Shares under this
Agreement, the Company will reimburse such Purchaser and the Placement Agent for its reasonable
legal and other expenses (including the cost of any investigation preparation and travel in
connection therewith) incurred in connection therewith, as such expenses are incurred.



13









 




The reimbursement obligations of the Company under this paragraph shall be in addition to any
liability which the Company may otherwise have, shall extend upon the same terms and conditions to
any Affiliates of the Purchasers or the Placement Agent who are actually named in such action,
proceeding or investigation, and partners, directors, agents, employees and controlling persons (if
any), as the case may be, of the Purchasers, the Placement Agent and any of their Affiliates, and
shall be binding upon and inure to the benefit of any successors, assigns, heirs and personal
representatives of the Company, the Purchasers, the Placement Agent and any of their Affiliates and
any such Person. The Company also agrees that the Purchasers, the Placement Agent and their
Affiliates, partners, directors, agents, employees or controlling persons shall have no liability
to the Company or any Person asserting claims on behalf of or in right of the Company solely as a
result of the Purchasers acquiring the Shares under this Agreement. Notwithstanding the foregoing,
the Company shall have no obligation to the Placement Agent hereunder to the extent that the
liability incurred by it has been determined by a court of competent jurisdiction to be the result
of gross negligence, willful misconduct or intentional violation of any state or federal securities
laws.




     4.7. Indemnification. Subject to the provisions of this Section 4.7, the Company
will indemnify and hold the Purchasers, the Placement Agent and their directors, officers,
shareholders, partners, employees and agents (each, a “Purchaser Party”) harmless from any and all
losses, liabilities, obligations, claims, contingencies, damages, costs and expenses, including all
judgments, amounts paid in settlements, court costs and reasonable attorneys’ fees and costs of
investigation that any such Purchaser Party may suffer or incur as a result of or relating to (a)
any breach of any of the representations, warranties, covenants or agreements made by the Company
in this Agreement or in the other Transaction Documents or (b) any action instituted against a
Purchaser, or any of them or their respective Affiliates, by any shareholder of the Company who is
not an Affiliate of such Purchaser, with respect to any of the transactions contemplated by the
Transaction Documents (unless such action is based upon a breach of such Purchaser’s
representation, warranties or covenants under the Transaction Documents or any agreements or
understandings such Purchaser may have with any such shareholder or any violations by the Purchaser
of state or federal securities laws or any conduct by such Purchaser which constitutes fraud, gross
negligence, willful misconduct or malfeasance). If any action shall be brought against any
Purchaser Party in respect of which indemnity may be sought pursuant to this Agreement, such
Purchaser Party shall promptly notify the Company in writing, and the Company shall have the right
to assume the defense thereof with counsel of its own choosing. Any Purchaser Party shall have the
right to employ separate counsel in any such action and participate in the defense thereof, but the
fees and expenses of such counsel shall be at the expense of such Purchaser Party except to the
extent that (i) the employment thereof has been specifically authorized by the Company in writing,
(ii) the Company has failed after a reasonable period of time to assume such defense and to employ
counsel or (iii) in such action there is, in the reasonable opinion of such separate counsel, a
material conflict on any material issue between the position of the Company and the position of
such Purchaser Party. The Company will not be liable to any Purchaser Party under this Agreement
(i) for any settlement by an Purchaser Party effected without the Company’s prior written consent,
which shall not be unreasonably withheld or delayed; or (ii) to the extent, but only to the extent,
that a loss, claim, damage or liability is attributable to any Purchaser Party’s breach of any of
the representations, warranties, covenants or agreements made by the Purchasers in this Agreement
or in the other



14









 







Transaction Documents. Notwithstanding the foregoing, the Company shall have no obligation to
the Placement Agent hereunder to the extent that the liability incurred by it has been determined
by a court of competent jurisdiction to be the result of gross negligence, willful misconduct or
intentional violation of any state or federal securities laws.



     4.8. Reservation of Common Stock. As of the date hereof, the Company has reserved and
the Company shall continue to reserve and keep available at all times, free of preemptive rights, a
sufficient number of shares of Common Stock for the purpose of enabling the Company to issue the
Shares pursuant to this Agreement.



     4.9. Listing of Common Stock. The Company hereby agrees to use best efforts to
maintain the listing of the Common Stock on a Principal Market, and as soon as reasonably
practicable following the Closing (but not later than the earlier of the Effective Date and the
first anniversary of the Closing Date) to list all of the Shares on such Principal Market. The
Company further agrees, if the Company applies to have the Common Stock traded on any other
Principal Market, it will include in such application all of the Shares, and will take such other
action as is necessary to cause all of the Shares to be listed on such other Principal Market as
promptly as possible. The Company will take all action reasonably necessary to continue the
listing and trading of its Common Stock on a Principal Market and will comply in all respects with
the Company’s reporting, filing and other obligations under the bylaws or rules of the Principal
Market.



     4.10. Equal Treatment of Purchasers. 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. For clarification purposes, this provision constitutes a separate right granted to each
Purchaser by the Company and negotiated separately by each Purchaser, and is intended to treat the
Purchasers as a class and shall not in any way be construed as the Purchasers acting in concert or
as a group with respect to the purchase, disposition or voting of Shares or otherwise.



     4.11. Delivery of Shares After Closing. The Company shall deliver, or cause to be
delivered, the respective Shares purchased by each Purchaser to such Purchaser within five Trading
Days of the Closing Date.



ARTICLE V

MISCELLANEOUS




     5.1. Fees and Expenses. Except as otherwise set forth in this Agreement, each party
shall pay the fees and expenses of its advisers, 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. The Company shall pay all stamp and other taxes and
duties levied in connection with the sale of the Shares.



     5.2. Entire Agreement. The Transaction Documents, together with the exhibits and
schedules thereto, contain the entire understanding of the parties with respect to the subject
matter hereof and supersede all prior agreements and understandings, oral or written, with



15









 







respect to such matters, which the parties acknowledge have been merged into such documents,
exhibits and schedules.



     5.3. Notices. Any and all notices or other communications or deliveries required or
permitted to be provided hereunder shall be in writing and shall be deemed given and effective on
the earliest of (a) the date of transmission, if such notice or communication is delivered via
facsimile at the facsimile number set forth on the signature pages attached hereto prior to 6:30
p.m. (Eastern time) on a Trading Day, (b) the next Trading Day after the date of transmission, if
such notice or communication is delivered via facsimile at the facsimile number set forth on the
signature pages attached hereto on a day that is not a Trading Day or later than 6:30 p.m. (Eastern
time) on any Trading Day, (c) the second Trading Day following the date of mailing, if sent by U.S.
nationally recognized overnight courier service, or (d) upon actual receipt by the party to whom
such notice is required to be given. The address for such notices and communications shall be as
set forth on the signature pages attached hereto.



     5.4. Amendments; Waivers. No provision of this Agreement may be waived or amended
except in a written instrument signed, in the case of an amendment, by the Company and each
Purchaser or, in the case of a waiver, by the party against whom enforcement of any such waiver is
sought. No waiver 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 subsequent
default or a waiver of any other provision, condition or requirement hereof, nor shall any delay or
omission of either party to exercise any right hereunder in any manner impair the exercise of any
such right.



     5.5. Construction. The headings herein are for convenience only, do not constitute a
part of this Agreement and shall not be deemed to limit or affect any of the provisions hereof.
The language used in this Agreement will be deemed to be the language chosen by the parties to
express their mutual intent, and no rules of strict construction will be applied against any party.



     5.6. Successors and Assigns. This Agreement shall be binding upon and inure to the
benefit of the parties and their successors and permitted assigns. The Company may not assign this
Agreement or any rights or obligations hereunder without the prior written consent of each
Purchaser. Any Purchaser may assign any or all of its rights under this Agreement to any Person to
whom such Purchaser assigns or transfers any Shares and Warrant Shares, provided such transferee
agrees in writing to be bound, with respect to the transferred Shares and Warrant Shares, by the
provisions hereof that apply to the “Purchasers”, and provided that such transferee represents and
warrants that it is an “accredited investor” or “qualified institutional buyer” as defined in
Section 3.2(d).



     5.7. No Third-Party Beneficiaries. This Agreement is intended for the benefit of the
parties hereto and their respective successors and permitted assigns and is not for the benefit of,
nor may any provision hereof be enforced by, any other Person, except as otherwise set forth in
Sections 4.6 and 4.7.



     5.8. Governing Law. All questions concerning the construction, validity, enforcement
and interpretation of the Transaction Documents shall be governed by and construed and



16









 







enforced in accordance with the internal laws of the Commonwealth of Pennsylvania, without
regard to the principles of conflicts of law thereof. Each party hereby irrevocably submits to the
exclusive jurisdiction of the state and federal courts sitting in the City of Philadelphia for the
adjudication of any dispute hereunder or in connection herewith or with any transaction
contemplated hereby or discussed herein (including with respect to the enforcement of any of the
Transaction Documents), and hereby irrevocably waives, and agrees not to assert in any suit, action
or proceeding, any claim that it is not personally subject to the jurisdiction of any such court,
that such suit, action or proceeding is improper or inconvenient venue for such proceeding. Each
party hereby irrevocably waives personal service of process and consents to process being served in
any such suit, action or proceeding by mailing a copy thereof via registered or certified mail or
overnight delivery (with evidence of delivery) to such party at the address in effect for notices
to it under this Agreement and agrees that such service shall constitute good and sufficient
service of process and notice thereof. Nothing contained herein shall be deemed to limit in any
way any right to serve process in any manner permitted by law. The parties hereby waive all rights
to a trial by jury. If either party shall commence an action or proceeding to enforce any
provisions of the Transaction Documents, then the prevailing party in such action or proceeding
shall be reimbursed by the other party for its attorneys’ fees and other costs and expenses
incurred with the investigation, preparation and prosecution of such action or proceeding.



     5.9. Survival. The representations and warranties herein shall survive the Closing
and delivery of the Shares.



     5.10. Execution. This Agreement may be executed in two or more counterparts, all of
which when taken together shall be considered one and the same agreement and shall become effective
when counterparts have been signed by each party and delivered to the other party, it being
understood that both parties need not sign the same counterpart. In the event that any signature
is delivered by facsimile transmission, such signature shall create a valid and binding obligation
of the party executing (or on whose behalf such signature is executed) with the same force and
effect as if such facsimile signature page were an original thereof.



     5.11. Severability. If any provision of this Agreement is held to be invalid or
unenforceable in any respect, the validity and enforceability of the remaining terms and provisions
of this Agreement shall not in any way be affected or impaired thereby and the parties will attempt
to agree upon a valid and enforceable provision that is a reasonable substitute therefor, and upon
so agreeing, shall incorporate such substitute provision in this Agreement.



     5.12. 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 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.



17









 





     5.13. Replacement of Shares. If any certificate or instrument evidencing any Shares
is mutilated, lost, stolen or destroyed, the Company shall issue or cause to be issued in exchange
and substitution for and upon cancellation thereof, or in lieu of and substitution therefor, a new
certificate or instrument, but only upon receipt of evidence reasonably satisfactory to the Company
of such loss, theft or destruction and customary and reasonable indemnity, if requested. The
applicants for a new certificate or instrument under such circumstances shall also pay any
reasonable third-party costs associated with the issuance of such replacement Shares.



     5.14. Remedies. In addition to being entitled to exercise all rights provided herein
or granted by law, including recovery of damages, each of the Purchasers and the Company will be
entitled to specific performance under the Transaction Documents. The parties agree that monetary
damages may not be adequate compensation for any loss incurred by reason of any breach of
obligations described in the foregoing sentence and hereby agrees to waive in any action for
specific performance of any such obligation the defense that a remedy at law would be adequate.



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



     5.16. Independent Nature of Purchasers’ Obligations and Rights. The obligations of
each Purchaser under any Transaction Document 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 any Transaction Document. Nothing contained herein or in
any Transaction Document, and no action taken by any Purchaser pursuant 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 Document.
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. Each Purchaser has been represented by its own separate legal counsel
in their review and negotiation of the Transaction Documents. The Company has elected to provide
all Purchasers with the same terms and Transaction Documents for the convenience of the Company and
not because it was required or requested to do so by the Purchasers.



(Signature Page Follows)




18









 








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




	 	 	 	 	 	 	 	 	 
	ESCALON MEDICAL CORP.	 	Address for Notice:	 	 
	 

	 	 	 	 	 	 

	 	 
	 
	 	 	 	 	 	 	 	 
	By:

	 	/s/ Richard J. DePiano, Jr	 	 	 	435 Devon Park Drive	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	Name: Richard J. DePiano, Jr
	 	 	 	Building 100	 	 
	 

	 	Title: President & General Counsel
	 	 	 	Wayne, PA 19087	 	 
	 
	 	 	 	 	 	 	 	 
	With a copy to (which shall not constitute notice):	 	Duane Morris, LLP	 	 
	Kathleen M. Shay, Esquire	 	30 South 17th Street	 	 
	 

	 	 	 	 	 	Philadelphia, PA 19103-4196	 	 






 [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK

SIGNATURE PAGES FOR PURCHASERS FOLLOW]




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[PURCHASER SIGNATURE PAGES TO ESMC SECURITIES PURCHASE AGREEMENT]




     IN WITNESS WHEREOF, the undersigned have caused this Securities Purchase Agreement to be duly
executed by their respective authorized signatories as of the date first indicated above.





	 	 	 	 	 
	Name of Investing
Entity: Michelle B. White	 	 
	Signature of Authorized Signatory of Investing Entity:  Michelle B. White	 	 
	Name of Authorized Signatory: Michelle B. White	 	 

	Title of Authorized Signatory: Owner	 	 	 	 
	Email Address of Authorized
Entity:                
                 
                 
    	 	 





Address for Notice of Investing Entity:




Barrett & Company

42 Weybosset Street

Providence, RI 02903




Address for Delivery of Shares for Investing Entity (if not same as above):




Subscription Amount: $247,500

Shares: 225,000

Per Share Purchase Price: $1.10




EIN Number:    [PROVIDE THIS UNDER SEPARATE COVER]




[SIGNATURE PAGES CONTINUE]




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[PURCHASER SIGNATURE PAGES TO ESMC SECURITIES PURCHASE AGREEMENT]




     IN WITNESS WHEREOF, the undersigned have caused this Securities Purchase Agreement to be duly
executed by their respective authorized signatories as of the date first indicated above.



Name of Investing Entity:    Lucille D. White Income Only Trust

Signature of Authorized Signatory of Investing Entity:    Lucille D. White

Name of Authorized Signatory:    Charles E. White TTEE

Title of Authorized Signatory:    Trustee

Email Address of Authorized Entity:                 
                 
                 
    




Address for Notice of Investing Entity:




Barrett & Company

42 Weybosset Street

Providence, RI 02903




Address for Delivery of Shares for Investing Entity (if not same as above):




Subscription Amount: $82,500

Shares: 75,000

Per Share Purchase Price: $1.10




EIN Number:    [PROVIDE THIS UNDER SEPARATE COVER]




[SIGNATURE PAGES CONTINUE]




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[PURCHASER SIGNATURE PAGES TO ESMC SECURITIES PURCHASE AGREEMENT]




     IN WITNESS WHEREOF, the undersigned have caused this Securities Purchase Agreement to be duly
executed by their respective authorized signatories as of the date first indicated above.



Name of Investing Entity:    Richard J. Snizek Rev Trust

Signature of Authorized Signatory of Investing Entity:    Richard J. Snizek

Name of Authorized Signatory:    Richard J. Snizek

Title of Authorized Signatory:    TTEE

Email Address of Authorized Entity:                 
                 
                 
    




Address for Notice of Investing Entity:




Barrett & Company

42 Weybosset Street

Providence, RI 02903




Address for Delivery of Shares for Investing Entity (if not same as above):




Subscription Amount: $110,000

Shares: 100,000

Per Share Purchase Price: $1.10




EIN Number:    [PROVIDE THIS UNDER SEPARATE COVER]




[SIGNATURE PAGES CONTINUE]




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[PURCHASER SIGNATURE PAGES TO ESMC SECURITIES PURCHASE AGREEMENT]




     IN WITNESS WHEREOF, the undersigned have caused this Securities Purchase Agreement to be duly
executed by their respective authorized signatories as of the date first indicated above.



Name of Investing Entity:   James F. Langway

Signature of Authorized Signatory of Investing Entity:   James F. Langway

Name of Authorized Signatory:   James F. Langway

Title of Authorized Signatory:    Owner

Email Address of Authorized Entity:                 
                 
                 
    




Address for Notice of Investing Entity:




Barrett & Company

42 Weybosset Street

Providence, RI 02903




Address for Delivery of Shares for Investing Entity (if not same as above):




Subscription Amount: $220,000

Shares: 200,000

Per Share Purchase Price: $1.10




EIN Number:    [PROVIDE THIS UNDER SEPARATE COVER]




[SIGNATURE PAGES CONTINUE]




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[PURCHASER SIGNATURE PAGES TO ESMC SECURITIES PURCHASE AGREEMENT]




     IN WITNESS WHEREOF, the undersigned have caused this Securities Purchase Agreement to be duly
executed by their respective authorized signatories as of the date first indicated above.



Name of Investing Entity:   W. Lincoln Mossop Jr. Trust

Signature of Authorized Signatory of Investing Entity:   
W. Lincoln Mossop, Jr., TTEE

Name of Authorized Signatory:   W. Lincoln Mossop, Jr.

Title of Authorized Signatory:    Beneficial Owner/Trustee

Email Address of Authorized Entity:                 
                 
                 
    




Address for Notice of Investing Entity:




Barrett & Company

42 Weybosset Street

Providence, RI 02903




Address for Delivery of Shares for Investing Entity (if not same as above):




Subscription Amount: $110,000

Shares: 100,000

Per Share Purchase Price: $1.10




EIN Number:   [PROVIDE THIS UNDER SEPARATE COVER]




[SIGNATURE PAGES CONTINUE]




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[PURCHASER SIGNATURE PAGES TO ESMC SECURITIES PURCHASE AGREEMENT]




     IN WITNESS WHEREOF, the undersigned have caused this Securities Purchase Agreement to be duly
executed by their respective authorized signatories as of the date first indicated above.




Name of Investing Entity:    Wallace L. Mossop III Trust

Signature of Authorized Signatory of Investing Entity:    Wallace L. Mossop, III

Name of Authorized Signatory:   Wallace L. Mossop, III

Title of Authorized Signatory:    Trustee

Email Address of Authorized Entity:                 
                 
                 
    




Address for Notice of Investing Entity:




Barrett & Company

42 Weybosset Street

Providence, RI 02903




Address for Delivery of Shares for Investing Entity (if not same as above):




Subscription Amount: $82,500

Shares: 75,000

Per Share Purchase Price: $1.10




EIN Number:   [PROVIDE THIS UNDER SEPARATE COVER]




[SIGNATURE PAGES CONTINUE]



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[PURCHASER SIGNATURE PAGES TO ESMC SECURITIES PURCHASE AGREEMENT]




     IN WITNESS WHEREOF, the undersigned have caused this Securities Purchase Agreement to be duly
executed by their respective authorized signatories as of the date first indicated above.



Name of
Investing Entity:    Wilson & Ellen Saville, JT. TEN.

Signature of Authorized Signatory of Investing Entity:   Ellen M. Saville

Name of Authorized Signatory:   Ellen M. Saville

Title of Authorized Signatory:    Owner

Email Address of Authorized Entity:                 
                 
                 
    




Address for Notice of Investing Entity:




Barrett & Company

42 Weybosset Street

Providence, RI 02903




Address for Delivery of Shares for Investing Entity (if not same as above):




Subscription Amount: $165,000

Shares: 150,000

Per Share Purchase Price: $1.10




EIN Number:    [PROVIDE THIS UNDER SEPARATE COVER]




[SIGNATURE PAGES CONTINUE]




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[PURCHASER SIGNATURE PAGES TO ESMC SECURITIES PURCHASE AGREEMENT]




     IN WITNESS WHEREOF, the undersigned have caused this Securities Purchase Agreement to be duly
executed by their respective authorized signatories as of the date first indicated above.



Name of Investing Entity:    Robin Saville Wheeler Living Trust

Signature of Authorized Signatory of Investing Entity:   Robin Saville Wheeler TTEE

Name of Authorized Signatory:    Robin S. Wheeler

Title of Authorized Signatory:   Owner/Trustee

Email Address of Authorized Entity:                 
                 
                 
    




Address for Notice of Investing Entity:




Barrett & Company

42 Weybosset Street

Providence, RI 02903




Address for Delivery of Shares for Investing Entity (if not same as above):




Subscription Amount: $82,500

Shares: 75,000

Per Share Purchase Price: $1.10




EIN Number:    [PROVIDE THIS UNDER SEPARATE COVER]




[SIGNATURE PAGES CONTINUE]





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