ex101.htm


    Exhibit
10.1

     

    
 

    EMPLOYMENT
AGREEMENT

     

    AGREEMENT dated as of the
18th
day of February, 2009, by and among Sahara Media Holdings, Inc., a Delaware
corporation with its principal office at 81 Greene Street, 4th Floor,
New York, New York 10012 (the “Company”), and Philmore Anderson IV, an
individual (“Executive”).

     

    W I T N E S S E T
H:

     

    WHEREAS, the Company desires
to engage Executive to serve at its chief executive officer on and subject to
the terms of this Agreement;

     

    NOW, THEREFORE, in
consideration of the mutual promises set forth in this Agreement, the parties
agree as follows:

     

    1. Employment and
Duties.

     

    (a) Subject
to the terms and conditions hereinafter set forth, the Company hereby employs
Executive as chief executive officer, during the Term, as hereinafter
defined.  As chief executive officer of the Company, Executive shall
have the duties and responsibilities associated with the chief executive officer
of a public corporation.  Executive shall also perform such other
duties and responsibilities as may be determined by the Company’s board of
directors (the “Board”), as long as such duties and responsibilities are
consistent with those of the Company’s chief executive officer.

     

    (b) The term
of Executive’s employment under this Agreement shall commence as of February 18,
2009 (the “Commencement Date”) and shall continue for 36 months, unless earlier
terminated in accordance with Section 5 hereof. The period commencing as of the
Commencement Date and ending 36 months thereafter, subject to earlier
termination pursuant to Section 5 hereof, is referred to herein as the
“Term.”

     

    2. Executive’s
Performance.  Executive hereby accepts the employment
contemplated by this Agreement. During the Term, Executive shall perform his
duties diligently, in good faith and in a manner consistent with the best
interests of the Company, and shall devote substantially all of his business
time to the performance of his duties under this Agreement.  In the
course of his employment, Executive shall comply with all policies, including
Codes of Ethics, that are applicable to the Company’s officers in general and
chief executive officer, in particular.

     

    3. Compensation and Other
Benefits.

     

    (a) Within
five business days of the Commencement Date, the Company shall pay Executive a
cash signing bonus of $155,000.

     

    (b) For his
services during the Term, the Company shall pay Executive a fixed annual salary
equal to $300,000 during the first year of the Term, $325,000 during the second
year of the Term, and $350,000 during the third year of the Term (“Salary”).
Salary payments shall be payable monthly in arrears in accordance with the
Company’s policy on executive compensation.

     

    (c) During
the Term, Executive shall be entitled to participate in all compensation and
employee benefit plans and programs (including health insurance), and to receive
all benefits and perquisites, which are approved by the Board and are generally
made available to all salaried employees and executives (including Directors and
Officers liability insurance). During the Term, the Company shall maintain key
man life insurance on Executive, for which the Company shall be the
beneficiary.

     

    
      
         

      

      
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    (d) During
the Term, Executive shall be eligible for such bonus payments as shall be
determined by the Board in its sole discretion.

     

    (e) During the Term, Executive
shall be entitled to paid vacation and holidays in accordance with the Company's
normal personnel policies for salaried employees and executives, but not less
than four (4) weeks of vacation per calendar year. Executive shall be entitled
to no more than an aggregate of five (5) sick days and personal days per
calendar year. Up to a maximum of one (1) week of unused vacation time will
carry over to the following calendar year.

     

    (f) As soon as practicable after
the Commencement Date, the Company shall grant to the Executive an option (the
“Option”) to purchase 3,000,000 shares of the Company’s common stock at an
exercise price of $2.00 per share, which shall be granted pursuant to an option
agreement between the Company and Executive which option agreement shall be in a
form that is acceptable to the Company’s Board . In connection with the receipt
of the Option, Executive makes the representations to the Company set forth on
Appendix A hereto.

     

    4. Reimbursement of
Expenses.  The Company shall reimburse Executive, upon
presentation of proper expense statements, for all authorized, ordinary and
necessary out-of-pocket expenses reasonably incurred by Executive during the
Term in connection with the performance of his services pursuant to this
Agreement in accordance with the Company’s expense reimbursement
policy.

     

    5. Termination of
Employment

     

    (a) Executive
may terminate Executive’s employment prior to the expiration of the Term upon
thirty days’ prior written notice to the Company. The Company may terminate
Executive's  employment prior to the expiration of the Term; provided,
however, that if such termination is by the Company for any reason other than a
Termination for Cause (as defined in Section 5(b) hereof), or if the termination
by Executive is by reason of a change of control of the Company, or Executive
becoming disabled while engaged in his activities as the chief executive officer
of the Company, then (i) all unvested options, warrants and other equity grants
shall vest immediately, (ii) Executive will be entitled to receive severance
payments equal to the greater of (x) the balance of the Salary payable, and
benefits to which Executive is entitled, under this Agreement for the balance of
the Term (including health insurance), or (y) an amount equal to two and
one-half (2.5) times the highest cash compensation (Salary plus bonus) paid to
Executive during any 12 month period prior to the termination, which shall be
paid no later than the last day of Executive’s employment, (iii) Executive shall
be entitled to a continuation of health and other medical benefits and coverage
at the cost and expense of the Company for a period of not less than 18 months,
in consideration for all of which the parties hereto shall exchange mutual
releases of claims, and (iv) the Executive shall sell or cause to be sold to the
Company, and the Company shall purchase, all shares of issued and outstanding
common stock of the Company beneficially owned by Executive or Philmore Anderson
III (within the meaning of Rule 13d-3 under the Securities Exchange Act of 1934,
as amended (the “Exchange Act”), for a purchase price per share that is the
higher of (a) $1.50, or (b) the last reported closing price of the Company’s
common stock on the OTC Bulletin Board or such other exchange or market that is
the principal trading exchange or market for the Company’s common stock, as of
the date of termination. The Executive shall not be required to mitigate damages
or the amount of any payment provided for under this Agreement by seeking other
employment or otherwise, nor will any payments hereunder be subject to offset in
the event Executive does mitigate. In the event that the Executive’s employment
terminates prior to the expiration of the Term due to any reason, earned but
unpaid Salary as of the date of termination of employment shall be paid in
full.

     

    
      
         

      

      
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    (b) For purposes of this
Agreement, the term "Termination for Cause" means, a termination by reason of
any of the following:

     

    (i) Executive's material breach of
the provisions of Section 6;

     

    (ii) Executive's material and willful
failure or refusal on more than one occasion (in each case, of which he is made
aware in writing by the Company promptly and in no event more than seven days
after such failure or refusal) to perform Executive's duties in accordance with
Section 1 hereof, if there is a demonstrable adverse effect to the
Company;

     

    (iii) willful failure on more than one
occasion by Executive (in each case, of which he is made aware in writing by the
Company promptly and in no event more than seven days after such failure) to
comply in any material respect with any reasonable written policies or
directives of the Board; or

     

    (iv) Executive
is convicted of, or pleads guilty (or nolo contendre) to, any felony (but not
any traffic or similar infraction) or crime involving fraud, misappropriation or
embezzlement against the Company; provided,
however, that (x) no conduct by Executive shall be deemed willful for purposes
of this Section 5 if Executive believed in good faith that such conduct was in
or not opposed to the best interests of the Company, and (y) Cause shall in no
event be deemed to exist (1) with respect to clauses (i), (ii) and (iii) above,
unless Executive shall have first received written notice from the Board
advising Executive of the specific acts or omissions alleged to constitute a
failure or breach giving rise expressly to Cause hereunder, and such failure or
breach continues after Executive shall have had a reasonable opportunity (which
shall be defined as a period of time consisting of at least 15 days from the
date Executive receives said notice) to correct the acts or omissions so
complained of, and (2) except upon a finding reflected in a resolution of the
Board approved by at least 66% of the members of the Board, whose finding shall
not be binding upon or entitled to any deference by any court, arbitrator or
other decision-maker ruling on this Agreement, at a meeting to which Executive
(and Executive’s counsel) shall be invited upon proper notice.

     

    (c) For purposes of this
Agreement, unless otherwise consented to in writing by Executive, Executive’s
employment shall be deemed to have been terminated by the Company for a reason
other than a Termination for Cause in the event of:

     

    (i)  the
material reduction of Executive’s title, authority, duties or responsibilities,
or the assignment to Executive of duties materially inconsistent with
Executive’s positions with the Company as stated in Section 1 hereof (including,
without limitation, a failure of Executive to continue to be elected (after
having been elected) to serve as a member of the Board);

     

    (ii)  (A) a reduction in the
Salary of Executive, or (B) without limiting the foregoing, any failure to pay
the Salary to Executive in accordance with Section 3(b), if such failure is not
cured by the Company within five days of notice of such failure (provided that
the Company shall not have repeated rights to cure);

     

    (iii)  the
relocation of Executive’s office to more than 25 miles from New York
County;

     

    (iv)  the
Company’s failure to pay Executive any amounts otherwise due hereunder or under
any plan, policy, program, agreement, arrangement or other commitment of the
Company if such failure is not cured by the Company within 15 days of notice of
such failure;

     

    
      
         

      

      
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    (v)  the
failure by the Company to obtain an agreement in form and substance reasonably
satisfactory to Executive from any successor to the business of the Company to
assume and agree to perform this Agreement; or

     

    
      (vi)  any
other material breach by the Company of this Agreement.

    

     

    (d) For purposes of this Agreement, “a
change of control of the Company” means the occurrence of one of the
following:

     

    (i)  a
“person” or “group” within the meaning of Sections 13(d) and 14(d) of the
Exchange Act, becomes the beneficial owner (within the meaning of Rule 13d-3
under the Exchange Act) of securities of the Company (including options,
warrants, rights and convertible and exchangeable securities) representing 25%
or more of the combined voting power of the Company’s then outstanding
securities in any one or more transactions;

     

    (ii)  the
approval of any sale, lease, exchange or other transfer (in one transaction or a
series of related transactions) of all, or substantially all, of the operating
assets of the Company, other than an internal restructuring of the
Company;

     

    (iii)  the
approval of a merger or consolidation, or a transaction having a similar effect
unless such merger, consolidation or similar transaction is with a subsidiary of
the Company or with another company, a majority of whose outstanding capital
stock is owned by the same persons or entities who own a majority of the
Company’s outstanding common stock at such time, where (A) the Company is not
the surviving corporation, (B) the majority of the common stock of the Company
is no longer held by the stockholders of the Company immediately prior to the
transaction, or (C) the Company’s common stock is converted into cash,
securities or other property (other than the common stock of a company into
which the Company is merged); or

     

    (iv)  a
majority of the members of the Board are not persons who (A) had been directors
of the Company for at least the preceding 24 consecutive months or (B) when they
initially were elected to the Board, (I) were nominated (if they were elected by
the stockholders) or elected (if they were elected by the directors) with the
affirmative vote of two-thirds of the directors who were Continuing Directors
(as defined below) at the time of the nomination or election by the Board and
(II) were not elected as a result of an actual or threatened solicitation of
proxies or consents by a person other than the Board or an agreement intended to
avoid or settle such a proxy solicitation (the directors described in clauses
(A) and (B) being “Continuing Directors”).

     

    (e) Upon
the death of the Executive at any time during the Term, the Company shall
purchase all issued and outstanding shares of common stock of the Company
beneficially owned by Executive, Philmore Anderson III, Sahara Entertainment,
LLC, BPA Associates, LLC and AG Unlimited (within the meaning of Rule 13d-3
under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), for
a purchase price per share that is the higher of (a) $1.50, or (b) the last
reported closing price of the Company’s common stock on the OTC Bulletin Board
or such other exchange or market that is the principal trading exchange or
market for the Company’s common stock, as of the date of
termination.

     

    
      
         

      

      
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    (f) If all, or any portion, of the
payments provided under this Agreement, either alone or together with other
payments and benefits which Executive receives or is entitled to receive from
the Company or an affiliate, would constitute an “excess parachute payment”
within the meaning of Section 280G of the Internal Revenue Code of 1986, as
amended (the “Code”) (whether or not under an existing plan, arrangement or
other agreement) (each such parachute payment, a “Parachute Payment”), and would
result in the imposition on the Executive of an excise tax under Section 4999 of
the Code, then, in addition to any other benefits to which the Executive is
entitled under this Agreement, the Executive shall be paid by the Company an
amount in cash equal to the sum of the excise taxes payable by the Executive by
reason of receiving Parachute Payments plus the amount necessary to put the
Executive in the same after-tax position (taking into account any and all
applicable federal, state and local excise, income or other taxes at the highest
possible applicable rates on such Parachute Payments (including without
limitation any payments under this Section 5) as if no excise taxes had been
imposed with respect to Parachute Payments (the “Parachute
Gross-up”).

     

    6. Trade Secrets and
Proprietary Information.

     

    (a) Executive
recognizes and acknowledges that the Company, through the expenditure of
considerable time and money, has developed and will continue to develop in the
future Confidential Information.  “Confidential Information” shall
mean all information of a proprietary or confidential nature relating to Covered
Persons, including, but not limited to, such Covered Person’s trade secrets or
proprietary information, confidential know-how, and marketing, services,
products, business, research and development activities, inventions and
discoveries, whether or not patentable, and information concerning such Covered
Person’s services, business, customer or client lists, proposed services,
marketing strategy, pricing policies and the requirements of its clients and
relationships with its lenders, suppliers, licensors, licensees and others with
which a Covered Person has a business relationship, financial or other data,
technical data or any other confidential or proprietary information possessed,
owned or used by the Company, the disclosure of which could or does have a
material adverse effect on the Company, its businesses, any business in which it
proposes to engage.  Executive agrees that he will not at any time use
or disclose to any person any Confidential Information relating to Company;
provided, however, that nothing in this Section 6(a) shall be construed to
prohibit Executive from using or disclosing such information if he can
demonstrate that such information (i) was known to Executive prior to Executive
becoming chief executive officer of the Company, (ii) became public knowledge
other than by or as a result of disclosure by a person not having a right to
make such disclosure or (iii) was disclosure that was authorized by the
Company.  The term “Covered Person” shall include the Company, any
subsidiaries and affiliates and any other person who provides information to the
Company pursuant to a secrecy or non-disclosure agreement.

     

    (b) In the
event that any Confidential Information is required to be produced by Executive
pursuant to legal process (including judicial process or governmental
administrative subpoena), Executive shall give the Company notice of such legal
process within a reasonable time, but not later than ten business days prior to
the date such disclosure is to be made, unless Executive has received less
notice, in which event Executive shall immediately notify the
Company.  The Company shall have the right to object to any such
disclosure, and if the Company objects (at the Company’s cost and expense) in a
timely manner so that Executive is not subject to penalties for failure to make
such disclosure, Executive shall not make any disclosure until there has been a
court determination on the Company’s objections.  If disclosure is
required by a court order, final beyond right of review, or if the Company does
not object to the disclosure, Executive shall make disclosure only to the extent
that disclosure is required by the court order, and Executive will exercise
reasonable efforts at the Company’s expense, to obtain reliable assurance that
confidential treatment will be accorded the Confidential
Information.

     

    (c) Executive
shall, upon expiration or termination of the Term, or earlier at the request of
the Company, turn over to the Company or destroy all documents, papers, computer
disks or other material in Executive’s possession or under Executive’s control
which may contain or be derived from Confidential Information.  To the
extent that any Confidential Information is on Executive’s hard drive or other
storage media, he shall, upon the request of the Company, cause either such
information to be erased from his computer disks and all other storage media or
otherwise take reasonable steps to maintain the confidential nature of the
material.

     

    (d) Executive
further realizes that any trading in Company’s common stock or other securities
or aiding or assisting others in trading in Company’s common stock or other
securities, including disclosing any non-public information concerning Company
or its affiliates to a person who uses such information in trading in the
Company’s common stock or other securities, while in possession of material
non-public information concerning the Company, may constitute a violation of
federal and state securities laws.  Executive will not engage in any
transactions involving the Company’s common stock or other securities while in
the possession of material non-public information in a manner that would
constitute a violation of federal and state securities laws.

     

    
      
         

      

      
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    (e) For the
purposes of Sections 6, 7 and 8 of this Agreement, the term “Company” shall
include the Company, and any subsidiaries and affiliates.

     

    7. Covenant Not To Solicit or
Compete.

     

    (a) Executive
hereby covenants and agrees that, the Executive will not, except in the course
of his employment hereunder, during the Term and for a period of one year
following the end of the Term, without the prior written consent of the Company,
directly or indirectly, on his own behalf or in the service or on behalf of
others, whether or not for compensation, engage or invest in, own, manage,
operate, finance, control, or participate in the ownership, management,
operation, financing, or control of, be employed by, associated with, or in any
manner connected with, lend the Executive's name or any similar name to, lend
Executive's credit to or render services or advice to, any business whose
products, services or activities complete in whole or in part with the products,
services or activities of the Company anywhere within North
America.

     

    (b) Executive
hereby covenants and agrees that, the Executive will not, during the Term and
for a period of one year following the end of the Term, without the prior
written consent of the Company, directly or indirectly, on his own behalf or in
the service or on behalf of others, solicit, employ, or otherwise engage as an
employee, independent contractor, or otherwise, any person who is or was an
employee of the Company at any time during the Term or in any manner induce or
attempt to induce any employee of the Company to terminate his employment with
the Company; or (ii) interfere with the Company's relationship with any person,
including any person who at any time during the Term was an employee,
contractor, supplier, or customer of the Company.

     

    (c) Executive
hereby covenants and agrees that, the Executive will not, during the Term and
for a period of six months following the end of the Term, disparage the Company
or any of its shareholders, directors, officers, employees, or
agents.

     

    (d) Nothing
in this Section 7 shall be construed to prohibit Executive from owning a
passive, non-management interest of less than 5% in any public company that is
engaged in activities prohibited by this Section 7.

     

    8. Injunctive Relief.
Executive agrees that his violation or threatened violation of any of the
provisions of Sections 6 or 7 of this Agreement shall cause immediate and
irreparable harm to the Company. In the event of any breach or threatened breach
of any of said provisions, Executive consents to the entry of preliminary and
permanent injunctions by a court of competent jurisdiction prohibiting Executive
from any violation or threatened violation of such provisions and compelling
Executive to comply with such provisions. This Section 8 shall not affect
or limit, and the injunctive relief provided in this Section 8 shall be in
addition to, any other remedies available to the Company at law or in equity or
in arbitration for any such violation by Executive. The provisions of Sections
6, 7 and 8 of this Agreement shall survive any termination of this Agreement and
Executive’s employment and consulting relationship pursuant to this
Agreement.

     

    
      
         

      

      
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    9. Indemnification. The
Company shall provide Executive with indemnification to the maximum extent
permitted by the Company’s certificate of incorporation, by-laws and applicable
law.

     

    10. Representations by the
Executive.  Executive represents, warrants, covenants and
agrees that he has a right to enter into this Agreement, that he is not a party
to any agreement or understanding, oral or written, which would prohibit
performance of his obligations under this Agreement, and that he will not use in
the performance of his obligations hereunder any proprietary information of any
other party which he is legally prohibited from using.

     

    11. Miscellaneous.

     

    (a) Any
notice, consent or communication required under the provisions of this Agreement
shall be given in writing and sent or delivered by hand, overnight courier or
messenger service, against a signed receipt or acknowledgment of receipt, or by
registered or certified mail, return receipt requested, or telecopier or similar
means of communication if receipt is acknowledged or if transmission is
confirmed by mail as provided in this Section 11(a), to the parties at
their respective addresses set forth at the beginning of this Agreement, with
notice to the Company being sent to the attention of the individual who executed
this Agreement on its behalf. Any party may, by like notice, change the person,
address or telecopier number to which notice is to be sent.

     

    


    (b) The
validity, interpretation, performance, and enforcement of this Agreement shall
be governed by the laws of the State of New York.  In addition, the
Executive and the Company irrevocably submit to the jurisdiction of the courts
of the State of New York and the United States District Court sitting in New
York County for the purpose of any suit, action, proceeding or judgment relating
to or arising out of this Agreement and the transactions contemplated
hereby.  Service of process in connection with any such suit, action
or proceeding may be served on the Executive or the Company anywhere in the
world by the same methods as is specified for the giving of notices under this
Agreement.  The Executive and the Company irrevocably consent to the
jurisdiction of any such court in any such suit, action or proceeding and to the
laying of venue in such court.

     

    (c) If any
term, covenant or condition of this Agreement or the application thereof to any
party or circumstance shall, to any extent, be determined to be invalid or
unenforceable, the remainder of this Agreement, or the application of such term,
covenant or condition to parties or circumstances other than those as to which
it is held invalid or unenforceable, shall not be affected thereby and each
term, covenant or condition of this Agreement shall be valid and be enforced to
the fullest extent permitted by law, and any court or arbitrator having
jurisdiction may reduce the scope of any provision of this Agreement, including
the geographic and temporal restrictions set forth in Section 7 of this
Agreement, so that it complies with applicable law.

     

    (d) This
Agreement constitutes the entire agreement of the Company and Executive as to
the subject matter hereof, superseding all prior or contemporaneous written or
oral understandings or agreements, including any and all previous employment
agreements or understandings, all of which are hereby terminated, with respect
to the subject matter covered in this Agreement. This Agreement may not be
modified or amended, nor may any right be waived, except by a writing which
expressly refers to this Agreement, states that it is intended to be a
modification, amendment or waiver and is signed by both parties in the case of a
modification or amendment or by the party granting the waiver. No course of
conduct or dealing between the parties and no custom or trade usage shall be
relied upon to vary the terms of this Agreement. The failure of a party to
insist upon strict adherence to any term of this Agreement on any occasion shall
not be considered a waiver or deprive that party of the right thereafter to
insist upon strict adherence to that term or any other term of this
Agreement.

     

    
      
         

      

      
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    (e) No party
shall have the right to assign or transfer any of its or his rights hereunder
except that, subject to Section 5 of this Agreement, the Company’s rights and
obligations may be assigned in connection with a merger of consolidation of the
Company or a sale by the Company of all or substantially all of its business and
assets.

     

    (f) This
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective heirs, successors, executors, administrators and permitted
assigns.

     

    (g) The
headings in this Agreement are for convenience of reference only and shall not
affect in any way the construction or interpretation of this
Agreement.

     

    (h) This
Agreement may be executed in counterparts, each of which when so executed and
delivered will be an original document, but both of which counterparts will
together constitute one and the same instrument.

     

    


     

    IN WITNESS WHEREOF, the
parties have executed this Agreement as of the date first above
written.

     

     

    
      
        
          
            
              
                	 	SAHARA MEDIA
      HOLDINGS, INC.	 
	 	 	 	 
	 	
                        By:
      

                      	/s/ Philmore
      Anderson IV	 
	 	 	Name: Philmore
      Anderson IV	 
	 	 	Title: Chief
      Executive Officer	 
	 	 	 	 
	 	 	 	 
	 	 	/s/
      Philmore Anderson IV    	 
	 	 	Philmore
      Anderson IV	 


              

            

          

        

      

    

     

    


     

    
      
         

      

      
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    Appendix
A

    


    (a)           Executive Representation.  Executive
understands that the Option and shares underlying the Option (the “Option
Shares”) are each “restricted securities” and have not been registered under the
Securities Act or qualified under any applicable state securities law by reason
of their issuance in a transaction that does not require registration or
qualification (based in part on the accuracy of the representations and
warranties of Executive contained herein), and that such securities must be held
indefinitely unless a subsequent disposition is registered under the Securities
Act or any applicable state securities laws or is exempt from such
registration.  Executive hereby agrees that the Company may insert the
following or similar legend on the face of the certificates evidencing the
Option and Option Shares, if required in compliance with federal and state
securities laws:

     

    “These
securities have not been registered under the Securities Act of 1933, as amended
(the “Securities Act”) nor under the securities laws of any
state.  They may not be sold, offered for sale, or hypothecated in the
absence of a registration statement in effect with respect to the securities
under such act or an opinion of counsel reasonably satisfactory to the company
that such registration is not required pursuant to a valid exemption therefrom
under the Securities Act.”

     

     (b)           No
Distribution.  Executive is acquiring the Option and the Option
Shares as principal for his own account, in the ordinary course of business, and
not with a view to or for distributing or reselling such Option or Option Shares
or any part thereof.  Executive has no present intention of
distributing any of the Option or Option Shares and has no agreement or
understanding, directly or indirectly, with any other individual, 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 (each, a “Person”) regarding the
distribution of such Option or Option Shares (this representation and warranty
not limiting the right or intent to sell the Option or Option Shares
 pursuant to a registration statement or otherwise in compliance with
applicable federal and state securities laws).

     

    (d)           Investor
Status.  Executive is, and on each date on which he exercises
any Warrant will be  an “Accredited Investor” as defined in Rule
501(a)(1), (a)(2), (a)(3), (a)(7), or (a)(8) under the Securities
Act.  In general, an Accredited Investor is deemed to be an
institution with assets in excess of $5,000,000 or individuals with net worth in
excess of $1,000,000 or annual income exceeding $200,000, or $300,000 jointly
with their spouse.

     

    (c)           Experience of
Executive.  Executive, either alone or together with his
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, and has so evaluated the merits and risks of such
investment.  Executive is able to bear the economic risk of an
investment in the Option and the Option Shares and, at the present time, is able
to afford a complete loss of such investment.

     

    (d)           General
Solicitation.  Executive is not purchasing the Option or the
Option Shares as a result of any advertisement, article, notice or other
communication regarding the Option or the Option Shares 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.

     

    (e)            Access to
Information.  Executive has reviewed the Company’s filings with
the Securities and Exchange Commission (the “SEC Reports”) and neither the
Company nor any of its representatives have made any other representations or
warranties to Executive with respect to the Company except as contained herein
or in the SEC Reports and on which Executive is relying.  Executive
has also been afforded the opportunity to ask questions of, and receive answers
from, the officers and/or directors of the Company concerning the terms and
conditions of this offering and to obtain any additional information, to the
extent that the Company possesses such information or can acquire it without
unreasonable effort or expense, necessary to verify the accuracy of the
information furnished; and has availed himself of such opportunity to the extent
he considers appropriate in order to permit it to evaluate the merits and risks
of an investment in the Option and the Option Shares.  Notwithstanding
the foregoing, it is understood that Executive is purchasing the Option and the
Option Shares without being furnished any prospectus setting forth all of the
information that would be required to be furnished under the Securities
Act.