Document:

Unassociated Document

    SUBSCRIPTION
AGREEMENT

     

    THE
SECURITIES OFFERED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED OR THE SECURITIES LAWS OF ANY STATE.  THERE ARE
FURTHER RESTRICTIONS ON THE TRANSFERABILITY OF THE SHARES DESCRIBED
HEREIN.

     

    THE
ACQUISITION OF THE SECURITIES OFFERED HEREBY INVOLVES A HIGH DEGREE OF RISK AND
SHOULD BE CONSIDERED ONLY BY PERSONS WHO CAN BEAR THE RISK OF THE LOSS OF THEIR
ENTIRE INVESTMENT.

     

    WES
Consulting, Inc.

    2745
Bankers Industrial Drive

    Atlanta,
GA 30360

    

    Gentlemen:

    

    The
undersigned understands that WES Consulting Inc., a Florida corporation (the
“Company”), is offering for sale up to 2,000,000 Shares of its Common Stock,
$.01 par value per share (the “Shares”) at a price of $0.30 per share of common
stock.  This offering is made pursuant to a Private Placement Term
Sheet (the "Term Sheet") dated December 11, 2009, as more particularly described
and set forth in therein.  The undersigned further understands that
the issuance of the Shares is part of a private offering by the Company (the
“Offering”) that is being made without registration of the Securities under the
Securities Act of 1933, as amended (the “Securities Act”), and is being made
only to “Accredited Investors” (as defined in Rule 501 of Regulation D under the
Securities Act).

     

    Section
1.               Subscription.  Subject
to the terms and conditions hereof and the provisions of the Term Sheet, the
undersigned hereby irrevocably subscribes the Shares in the amount set forth in
Appendix A, which amount is payable as described in Section 4
hereof.  The undersigned acknowledges that the Shares, if issued by
the Company, will be subject to restrictions on transfer as further set forth in
this Subscription Agreement (the “Agreement”).

     

    Section
2.               Acceptance of Subscription
and Issuance of Shares.  It is understood and agreed that the
Company shall have the sole right, at its complete discretion, to accept or
reject this subscription, in whole or in part, for any reason and that the same
shall be deemed to be accepted by the Company only when it is signed by a duly
authorized officer of the Company and delivered to the undersigned at the
Closing referred to in Section 3 hereof.  Subscriptions need not be
accepted in the order received, and the Shares may be allocated among
subscribers.  Notwithstanding anything in this Agreement to the
contrary, the Company shall have no obligation to issue the Shares to any person
who is a resident of a jurisdiction in which the issuance of the Shares to him
would constitute a violation of the securities, “blue sky” or other similar laws
of such jurisdiction (collectively referred to as the “State Securities
Laws”).

     

    Section
3.               The
Closing.  Promptly after receiving the subscriptions for the
minimum number of Shares as set forth in the Term Sheet, the closings of the
issuance of the Shares (the “Closing”) shall take place at the offices of WES
Consulting, Inc. or at such other time and place as the Company shall designate
by notice to the undersigned.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    Section
4.               Payment for
Shares.  Payment for the Shares shall be sent to Continental
Stock Transfer and Trust Company, the escrow agent, by the undersigned in the
form of cashier’s check or wire transfer of immediately available funds at or
prior to the Closing, in an amount as set forth in Appendix A
hereto.  New Castle shall cause the Company and/or its Transfer Agent
to deliver the Shares, issued by the Company, to the undersigned at the
Closing.

     

    Section
5.               Representations, Warranties
and Covenants of the Undersigned.  The undersigned hereby
represents and warrants to and covenants with the Company and each officer,
director, and agent of the Company that:

     

    5.1           General.

     

    (a)           The
undersigned has all requisite authority to enter into this Agreement and to
perform all the obligations required to be performed by the undersigned
hereunder.

     

    (b)           The
undersigned is a resident of the state set forth on the signature page hereto
and is not acquiring an interest in the Shares as an agent or otherwise for any
other person.

     

    5.2           Information Concerning the
Company.

     

    (a)           The
undersigned has received a copy of the Term Sheet.  The undersigned
has not received any other offering literature and has relied solely only upon
the information contained within the Term Sheet deciding whether to subscribe to
the Shares.

     

    (b)           The
undersigned is aware that the Company has a limited operating history and is
familiar with the business and financial condition, properties, operations and
prospects of the Company, all as generally described in the Term
Sheet.  The undersigned has been given the opportunity to obtain any
information necessary to verify the accuracy of the information set forth in the
Term Sheet and has been furnished all such information so requested.

     

    (c)           The
undersigned understands that, unless he notifies the Company in writing to the
contrary at or before the Closing, all the undersigned’s representations,
warranties and acknowledgements contained in this Agreement will be deemed to
have been reaffirmed and confirmed as of the Closing, taking into account all
information received by the undersigned.

     

    (d)           The
undersigned understands that the investment in the Company through the Shares
involves various risks as outlined in the Term Sheet and this
Agreement.

     

    (e)           The
undersigned understands that no federal or state agency has passed upon the
Shares or made any finding or determination concerning the fairness or
advisability of this investment.

     

    (f)           The undersigned acknowledges that neither the Company
nor any other person offered to sell the Shares to it by means of any form of
general advertising, such as media advertising or
seminars.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    (g)           The undersigned acknowledges that the Company has the
right, in its sole and absolute discretion, to abandon this Offering at any time
prior to the Closing and to return the previously paid subscription amount as
set forth in Appendix A hereto without interest or penalty thereon, to the
undersigned.

     

    (h)           The undersigned has not used any person as a “Purchaser
Representative” with the meaning of Regulation D of the Securities Act to
represent it in determining whether it should purchase the
shares.

     

    (i)     
      The
undersigned has sufficient knowledge and experience in financial, business and
commercial matters to be capable of evaluating the merits and risks of an
investment in the Company and making an informed investment decision with
respect thereto.  In this regard, the undersigned is not acquiring the
Shares based upon any representation, oral or written, by any person with
respect to the future value of, or income from, the Shares but rather upon the
undersigned's examination and judgment as to the prospects of the
Company.

     

    (j)       
    The undersigned has
consulted with the undersigned’s attorney, financial advisors and others
regarding all financial, securities and tax aspects of the proposed investment,
and that said advisors have reviewed this agreement, the Term Sheet and all
documents relating thereto on the undersigned’s behalf.

     

    5.3           Status of
Undersigned.

     

    (a)           The
undersigned has such knowledge, skill and experience in business, financial and
investment matters so that he is capable of evaluating the merits and risks of
an investment in the Company through the Shares.

     

    (b)           The
undersigned is an “Accredited Investor” as defined in Rule 501(a) under the
Securities Act.  The undersigned agrees to furnish any additional
information requested to assure compliance with applicable federal and state
securities laws in connection with the issued of the Shares.  The
undersigned acknowledges that he has completed the Accredited Investor
Certificate contained in Appendix B and that the information contained therein
is complete and accurate as of the date thereof and is hereby affirmed as of the
date hereof.

     

    5.4           Restrictions on Transfer or
Sale of
Securities.

     

    (a)           The
undersigned is being issued the Shares (the securities represented thereby being
referred to herein as the “Securities”) solely for his own beneficial account,
for investment purposes, and not with a view to, or for, resale in connection
with any distribution of the Securities.  The undersigned understands
that the Securities have not been registered under the Securities Act or any
State Securities Laws by reason of specific exemptions under the provisions
thereof which depend in part upon the investment intent of the undersigned and
of the other representations made by the undersigned in this
Agreement.  The undersigned understands that the Company is relying
upon the representations and agreements contained in this Agreement (and any
supplemental information) for the purpose of determining whether this
transaction meets the requirements for such exemptions.

     

    (b)           The
undersigned understands that the Securities are “restricted securities” under
applicable federal securities laws and that the Securities Act and the rules of
the Securities and Exchange Commission (the “Commission”) provide in substance
that the undersigned may dispose of the Securities only pursuant to an effective
registration statement under the Securities Act or an exemption therefrom, and
the undersigned understands that the Company has no obligation or intention to
register the Securities, except for certain registration rights as set forth in
Section 8 below, or to take action so as to assist sales pursuant to the
Securities Act (including Rule 144 thereunder).  Accordingly, the
undersigned understands that under the Commission’s rules, the undersigned may
dispose of the Securities principally only in “private transactions” which are
exempt from registration under the Securities Act, in which event the transferee
will acquire “restricted securities” subject to the same limitations as in the
hands of the undersigned.  As a consequence, the undersigned
understands that he must bear the economic risks of the investment in the
Securities for an indefinite period of time.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    (c)           The
undersigned understands that there is no public market for the Shares (prior to
registration) and a limited public market exists for the Common Stock of the
Company and a more significant public market may never develop.

     

    (d)           The
undersigned agrees:  (A) that he will not sell, assign, pledge, give,
transfer or otherwise dispose of the Shares or any interest therein, or make any
offer or attempt to do any of the foregoing, except pursuant to a registration
of the Shares, as applicable, under the Securities Act and all applicable State
Securities Laws or in a transaction which is exempt from the registration
provisions of the Securities Act and all applicable State Securities Laws; (B)
that the certificate(s) for the Shares may bear a legend making reference to the
foregoing restrictions; and (C) that the Company and any transfer agent for the
Shares shall not be required to give effect to any purported transfer of such
shares except upon compliance with the foregoing restrictions.

     

    (e)           The
undersigned has not offered or sold any portion of the Shares with others nor
has entered into an agreement reselling or otherwise disposing of any portion of
the Shares.

     

    Section
6.              
Conditions to
Obligations of the Undersigned and the Company.  The
obligations of the undersigned to purchase and pay for that portion of the
Shares specified in Appendix A hereto and of the Company to issue the Shares are
subject to the satisfaction at or prior to the Closing of the following
conditions precedent:  (i) the representations and warranties of the
undersigned contained in Section 5 hereof, shall be true and correct on and as
of the Closing in all respects with the same effect as though such
representations and warranties had been made on and as of the Closing; and (ii)
the undersigned shall complete, execute and deliver this Agreement and all
documents contemplated hereby and provided for herein.

     

    Section
7.               Legend.  Any
certificate for the Shares, if issued, will be imprinted with a legend in
substantially the following form:

     

    “THE
SECURITIES REPRESENTED BY THIS INSTRUMENT HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR UNDER ANY STATE
SECURITIES LAWS, AND MAY NOT BE PLEDGED, SOLD, ASSIGNED, HYPOTHECATED OR
OTHERWISE TRANSFERRED UNLESS (1) A REGISTRATION STATEMENT WITH RESPECT THERETO
IS EFFECTIVE UNDER THE SECURITIES ACT AND ANY APPLICABLE STATE SECURITIES LAWS
OR (2) THE ISSUER OF SUCH SECURITIES RECEIVES AN OPINION OF COUNSEL TO THE
ISSUER OR HOLDER OF SUCH SECURITIES, WHICH COUNSEL AND OPINION ARE REASONABLY
ACCEPTABLE TO THE ISSUER, THAT SUCH SECURITIES MAY BE PLEDGED, SOLD, ASSIGNED,
HYPOTHECATED OR OTHERWISE TRANSFERRED WITHOUT AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE ACT AND APPLICABLE STATE SECURITIES LAWS.”

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    Section
8.               Registration
Rights.

     

    8.1           Registration;
Definitions.

     

    (a)           The
Company  anticipates that within thirty (30) days following the
consummation of the transactions contemplated by this Term Sheet, the Company
will use its best efforts to undertake to begin the preparation of a
registration statement (the “Registration Statement”) necessary
to  (i) register Registrable Securities (as such term is defined
below) in connection with the raising of an additional Three Million Dollars
($3,000,000) by the Company and (ii) registration of the Shares and other
securities issued in connection with this Offering.  The Registration
Statement required hereunder shall be on Form S-1 (or another appropriate form
in accordance herewith).  Subject to the terms of this Agreement, the
Company shall use its best reasonable efforts to cause the Registration
Statement to be filed within sixty (60) days the closing of the Offering and to
be declared effective under the Securities Act as promptly as possible after the
filing thereof and in any event within 180 days of the date of filing (the
“Relevant Effective Date”), and shall use its commercially reasonable efforts to
keep the Registration Statement continuously effective under the Securities Act
until the date when all Registrable Securities covered by the Registration
Statement have been sold or may be sold without restrictions pursuant to Rule
144 as determined by the counsel to the Company pursuant to a written opinion
letter to such effect, addressed and acceptable to the Company’s transfer agent
and the affected Holders (the “Effectiveness Period”).  The Company
shall file up to one (1) additional registration statement on Form S-1 (or
another appropriate form in accordance herewith) and use its commercially
reasonable efforts to cause such registration statement, if any, to be declared
effective under the Securities Act as promptly as possible to cover any
additional Registrable Securities, including any shares of the Company’s common
stock issuable under the Placement Warrant and to cover any shares issuable upon
payment of dividends in shares of Common Stock. If the Company is obligated to
make, and does make, an Additional Registration pursuant to Section 8.3, the
Company shall include any additional Registrable Securities in the Additional
Registration (subject to any Cutback restriction as described in Section 8.3).
In no event shall the Company be obligated to make more than one Additional
Registration, whether pursuant to this Section 8.1 (a), Section 8.3 or any other
provision of this Agreement

     

    (b)           The
term “Registrable Securities” shall mean the Shares; provided, however, that
securities shall only be treated as Registrable Securities if and only for so
long as they (i) have not been sold (A) pursuant to a registration statement;
(B) to or through a broker, dealer or underwriter in a public distribution or a
public securities transaction; and/or (C) in a transaction exempt from the
registration and prospectus delivery requirements of the Securities Act under
Section 4(1) thereof so that all transfer restrictions and restrictive legends
with respect thereto, if any, are removed upon the consummation of such sale;
(ii) are not held by a Holder or a permitted transferee; and (iii) are not
eligible for sale pursuant to Rule 144 (or any successor thereto) under the
Securities Act.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    (c)           The
term “Holder” shall mean any person owning or having the right to acquire
Registrable Securities or any permitted transferee of a Holder.

     

    8.2           Remedies.  In
the event of a breach by the Company or by a Holder, of any of their obligations
under this Agreement, each Holder or the Company, as the case may be, in
addition to being entitled to exercise all rights granted by law and under this
Agreement, including recovery of damages, will be entitled to specific
performance of its rights under this Agreement.  The Company and each
Holder agree that monetary damages would not provide adequate compensation for
any losses incurred by reason of a breach by it of any of the provisions of this
Agreement and hereby further agrees that, in the event of any action for
specific performance in respect of such breach, it shall waive the defense that
a remedy at law would be adequate.

     

    8.3           Cutback.  In
connection with filing the Registration Statement pursuant to Section 8.1
hereof, if the Commission limits the amount of Registrable Securities to be
registered for resale pursuant to Rule 415 under the Securities Act or otherwise
(a “Cutback”), then the Company shall be entitled to exclude such disallowed
Registrable Securities on a pro rata basis among the Holders thereof. If such a
Cutback occurs, then the Company shall include such disallowed Registrable
Securities in the Additional Registration of filed in accordance with Section
8.1 (a). If the Company is not obligated under Section 8.1 (a) to file an
Additional Registration within 180 days of the Relevant Effective Date, then,
upon request of the Holders of a majority of the shares subject to the Cutback,
the Company shall initiate the Additional Registration for such disallowed
Registrable Securities in the manner contemplated by Section
8.1(a).  In no event shall the Company be obligated to make more than
one Additional Registration, whether pursuant to this Section 8.3, Section
8.1(a) or any other provision of this
Agreement.       

     

    8.4           Waivers.  With
the written consent of the Company and the Holders holding at least a majority
of the Registrable Securities that are then outstanding, any provision of this
Section 8 may be waived (either generally or in a particular instance, either
retroactively or prospectively and either for a specified period of time or
indefinitely) or amended.  Upon the effectuation of each such waiver
or amendment, the Company shall promptly give written notice thereof to the
Holders, if any, who have not previously received notice thereof or consented
thereto in writing.

     

               Section
9.                   
Waiver;
Amendment.  Neither this Agreement nor any provisions hereof
shall be modified, amended, discharged or terminated except by an instrument in
writing, signed by the party against whom any modification, amendment, discharge
or termination is sought.  Any term or condition of this Agreement may
be waived at any time by the party that is entitled to the benefit thereof, but
no such waiver shall be effective unless set forth in a written instrument duly
executed by or on behalf of the party waiving such term or
condition.  No waiver by any party of any term or condition of this
Agreement, in any one or more instances, shall be deemed to be or construed as a
waiver of the same on any other term or condition of this Agreement on any
future occasion.  All remedies, either under this Agreement or by law
or otherwise afforded, will be cumulative and not alternative.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

               Section
10.                 
Assignability.  Neither
this Agreement nor any right, remedy, obligation or liability arising hereunder
or by reason hereof shall be assignable by either the Company (except to a
subsidiary or parent entity of the Company) or the undersigned without the prior
written consent of the other party.

     

               Section
11.                 
GOVERNING
LAW.  THIS AGREEMENT SHALL BE CONSTRUED, AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES HEREUNDER DETERMINED, IN ACCORDANCE WITH AND GOVERNED
BY THE INTERNAL LAWS OF THE STATE OF NEW YORK (AS PERMITTED BY SECTION 5-1401 OF
THE NEW YORK GENERAL OBLIGATIONS LAW (OR ANY SIMILAR SUCCESSOR PROVISION))
WITHOUT GIVING EFFECT TO ANY CHOICE OF LAW RULE THAT WOULD CAUSE THE APPLICATION
OF THE LAWS OF ANY JURISDICTION OTHER THAN THE INTERNAL LAWS OF THE STATE OF NEW
YORK TO THE RIGHTS AND DUTIES OF THE PARTIES; PROVIDED, HOWEVER, THAT ALL LAWS
PERTAINING OR RELATING TO CORPORATE GOVERNANCE OF THE COMPANY SHALL BE CONSTRUED
IN ACCORDANCE WITH AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF DELAWARE
WITHOUT GIVING EFFECT TO ANY CHOICE OF LAW RULE THAT WOULD CAUSE THE APPLICATION
OF THE LAWS OF ANY JURISDICTION OTHER THAN THE INTERNAL LAWS OF THE STATE OF
DELAWARE TO THE CORPORATE GOVERNANCE OF THE COMPANY.

     

               Section
12.                 
Section and Other
Headings.  The section and other headings contained in this
Agreement are for reference purposes only and shall not affect the meaning or
interpretation of this Agreement.

     

               Section
13.                 
Counterparts.  This
Agreement may be executed in any number of counterparts, each of which when so
executed and delivered shall be deemed to be an original and all of which
together shall be deemed to be one and the same agreement.

     

               Section
14.                 
Notices.  All
notices and other communications provided for herein shall be in writing and
shall be deemed to have been duly given if delivered personally or sent by
registered or certified mail, return receipt requested, postage
prepaid:

     

                                    14.1         If
to the Company, to it at the following address:

     

    WES
Consulting, Inc.

    2745
Bankers Industrial Drive

    Atlanta,
GA 30360

    Attention: 
Louis Friedman

    President

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

                                    14.2         If
to the undersigned, to him at the address set forth on the signature page
hereto; or at such other address as either party shall have specified by notice
in writing to the other.

     

               Section
15.                
 Binding
Effect.  The provisions of this Agreement shall be binding upon
and accrue to the benefit of the parties hereto and their respective heirs,
legal representatives, successors and assigns.

     

               Section
16.                
 Survival.  All
representations, warranties and covenants contained in this Agreement shall
survive (i) the acceptance of the subscription by the Company, (ii) changes in
the transactions, documents and instruments described in the Term Sheet which
are not material or which are to the benefit of the undersigned, and (iii) the
death or disability of the undersigned.

     

               Section
17.                
 Notification of
Changes.  The undersigned hereby covenants and agrees to notify
the Company upon the occurrence of any event prior to the Closing pursuant to
this Agreement which would cause any representation, warranty, or covenant of
the undersigned contained in this Agreement to be false or
incorrect.

     

               Section
18.                
 Entire
Agreement.  This Agreement, including Appendix A attached
hereto, supersede all prior discussions and agreements among the parties hereto
with respect to the subject matter hereof and thereof and contain the sole and
entire agreement among the parties hereto with respect to the subject matter
hereof and thereof.

     

               Section
19.                
 Expenses;
Attorneys Fees.  Except as otherwise expressly set forth
herein, each party shall pay all expenses incurred by it or on its behalf in
connection with this Agreement or any transaction contemplated
hereby.

     

               Section
20.                
 Further
Assurances.  Each party hereto shall execute and deliver such
additional documents as may be necessary or desirable to consummate the
transactions contemplated by this Agreement.

     

               Section
21.                
 Severability.  Whenever
possible, each provision of this Agreement shall be interpreted in such a manner
as to be effective and valid under applicable law, but if any provision of this
Agreement shall be prohibited by or invalid under applicable law, such
provisions shall be ineffective to the extent of such prohibition or invalidity,
without invalidating the remainder of such provision or the remaining provisions
of this Agreement.

     

    [The
remainder of this page is intentionally left blank.]

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    IN
WITNESS WHEREOF, the undersigned has executed this Agreement
this      day of _____________, 2009.

     

    

    
      	 	      
              _____________________________________

            
	 	      
              Signature

            
	 	 
	 	 
	 
      	
              _____________________________________

            
	 
      	
              Print
      Name

            
	 
      	 
      
	 
      	 
      
	 
      	
              _____________________________________

            
	 
      	
              Number
      and Street

            
	 
      	 
      
	 
      	 
      
	 
      	
              _____________________________________

            
	 
      	
              City,
      State and Zip

            
	 
      	 
      
	 
      	 
      
	 
      	
              _____________________________________

            
	 
      	
              Subscriber’s
      Social Security

            
	 
      	
              or
      Tax Identification Number

            
	 
      	 
      
	 
      	 
      
	 
      	
              _____________________________________

            
	 
      	
              Signature
      of Co-owner if applicable

            

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    
      	
              If
      Joint Ownership, check one (all parties must sign
  above):

            
	 
      	 
      	 
      	 
      
	
              (
      )  Joint Tenants with 

                   Right
      of Survivorship

            	
              (
      )  Tenants in Common 

            	
              (
      )  Community Property

            	 
      
	 
      	 
      	 
      	 
      
	
              If
      Fiduciary or Corporation, check one:

            
	 
      	 
      	 
      	 
      
	
              (
      )  Trust

            	
              (
      )  Estate

            	
              (
      )  Power of Attorney

            	
              (
      )  Corporation

            

    

    

    CONSIDERATION
TO BE DELIVERED

    

    
      	
              Shares of Common Stock
      to be Acquired

            	
              Amount to be
      Paid

            
	
               

               

              Number of Shares of
      Common Stock

              At $0.30 per
      share:

               

              ______________

               

            	
               

               

               

               

               

              $_______________

               

            

    

    

    

    
      	
              Accepted
      by the Company;

            	 
      
	 
      	 
      
	 
      	 
      
	
              By:_________________________________

            	 
      
	
              Name:_______________________________

            	 
      
	
              Title:________________________________

            	 
      
	 
      	 
      

    

    

    

    Accepted
as of ___________________, 2009

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    APPENDIX
A

     

    ACCREDITED
INVESTOR CERTIFICATE

     

    The
undersigned Investor hereby certifies that at the Closing (as such term is
defined in the Subscription Agreement of which this Appendix B is a part
thereof) he is an Accredited Investor as that term is defined in Regulation D
adopted pursuant to the Securities Act of 1933, as amended  (the
“Act”).  The specific category(s) of Accredited Investor applicable to
the undersigned is checked below.

     

    
      	
              _____

            	
              a.  An
      individual whose individual net worth, or joint net worth with that
      individual’s spouse, at the time of his purchase exceeds $1,000,000
      (including the value of homes, home furnishings and personal
      automobiles);

            

    

     

    
      	
              _____

            	
              b.  An
      individual who had an individual income in excess of $200,000 in 2007 and
      2008 or joint income with that individual’s spouse in excess of $300,000
      in each of those years and who reasonably expects to reach the same income
      level in 2009.  For purposes of this offering, individual income
      shall equal adjusted gross income, as reported in the investor’s federal
      income tax return, less any income attributable to a spouse or to property
      owned by the spouse, and as may be further adjusted in accordance with the
      rules, regulations, and releases of the
  Commission;

            

    

     

    
      	
              _____

            	
              c.  A
      bank as defined in Section 3(a)(2) of the Act, or a savings and loan
      association or other institution as defined in Section 3(a)(5)(A) of the
      Act, whether acting in its individual or fiduciary capacity; a broker
      dealer registered pursuant to Section 15 of the Securities Exchange Act of
      1934; an insurance company as defined in Section 2(13) of the Act; an
      investment company registered under the Investment Company Act of 1940
      (the “1940 Act”) or a business development company as defined in Section
      2(a)(48) of the 1940 Act; a Small Business Investment Company licensed by
      the U.S. Small Business Administration under Section 301(c) or (d) of the
      Small Business Investment Act of 1958; or an employee benefit plan within
      the meaning of Title I of the Employee Retirement Income Security Act of
      1974 (“ERISA”), if the investment decision is made by a plan fiduciary, as
      defined in Section 3(21) of ERISA, which is either a bank, savings and
      loan association, insurance company or registered investment adviser, or
      if the employee benefit plan has total assets in excess of $5,000,000 or
      if a self-directed plan, with investment decisions made solely by persons
      that are accredited investors;

            

    

     

    
      	
              _____

            	
              d.  A
      private business development company as defined in Section 202(a)(22) of
      the Investment Advisers Act of
1940;

            

    

     

    
      	
              _____

            	
              e.  An
      organization described in Section 501(c)(3) of the Internal Revenue Code,
      corporation, Massachusetts or similar business trust, or partnership, not
      formed for the specific purpose of acquiring the Shares, with total assets
      in excess of $5,000,000;

            

    

     

    
      	
              _____

            	
              f.  An
      individual who is a director, executive officer, or general partner of the
      Company, or a director, executive officer, or general partner of a general
      partner of the Company; or

            

    

     

    
      	
              _____

            	
              g.  An
      entity in which all of the equity owners are Accredited Investors as
      defined above.

            

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    
       
IN
WITNESS WHEREOF, the undersigned has executed this Accredited Investor
Certificate this day of _______________, 2009.

    

     

    

    
      	 	      
              _____________________________________

            
	 	      
              Signature

            
	 	 
	 	 
	 
      	
              _____________________________________

            
	 
      	
              Print
      NameEXHIBIT
10.20

    

    LOAN
AND SECURITY AGREEMENT

    

    BETWEEN

    

    ENTREPRENEUR
GROWTH CAPITAL LLC

    505
Park Avenue

    New
York, New York 10022

    

    AND

    

    ONE
UP INNOVATIONS, INC.

    FOAM
LABS, INC.

    2745
Bankers Industrial Drive

    Atlanta,
GA  30360

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    This LOAN AND SECURITY AGREEMENT
(“Agreement”) dated
November 10, 2009 between ONE UP INNOVATIONS, INC., a Georgia corporation and
FOAM LABS, INC., a Georgia corporation, each having its principal place of
business at 2745 Bankers Industrial Drive, Atlanta, GA 30360 (individually and
collectively, the "Borrower") and ENTREPRENEUR
GROWTH CAPITAL, LLC, a Delaware limited liability company, having a principal
office at 505 Park Avenue, 6th Floor,
New York, NY 10022 (hereinafter called "Lender").  This
Agreement sets forth the terms and conditions upon which Lender may, in its sole
and absolute discretion, make loans, advances and other financial accommodations
to or for the benefit of Borrower upon the security referred to
herein.

    

    
      	
              SECTION 1. 

            	
                 DEFINED
    TERMS

            

    

    

    1.1.           All
capitalized terms used in this Agreement are defined either in this Agreement,
in the attached loan schedule (“Loan Schedule”), or in any
supplement to this Agreement or Loan Schedule.  All terms used herein
which are defined in Article 1 or Article 9 of the Uniform Commercial Code (the
"UCC") shall have the
same meaning as presently or as may hereafter be given therein unless otherwise
defined in this Agreement.  All references to the plural shall also
mean the singular.

    

    1.2.           "Account" or
"Accounts" shall have the same meaning as contained in Article 9 of the UCC and
shall also include contract rights and general intangibles related to Accounts,
payment intangibles, instruments, and to all proceeds thereof including, but not
limited to, the proceeds of any insurance thereon whether or not specifically
assigned to Lender.

    

    1.3.           "Account Debtor" shall
have the same meaning as contained in Article 9 of the UCC and shall also
include each debtor or obligor in any way obligated on or in connection with any
Account.

    

    1.4.           “Closing Date” means
the date of the initial advance made by Lender pursuant to this
Agreement.

    

    1.5.           "Collateral" shall
have the meaning set forth in Section 3.1 of this Agreement.

    

    1.6.           "Collateral Monitoring
Fee" shall have the meaning set forth in the Loan Schedule.

    

    1.7.           "Costs and Expenses"
shall include, but not be limited to commissions, fees, appraisal fees, taxes,
title insurance premiums, internal and external field examination expenses for
routine and non-routine audits and field examinations, filing, recording and
search expenses, reasonable internal and external attorney's fees and
disbursements (as may be incurred with respect to the effectuation of this
Agreement or any claim of any nature or litigation whatsoever arising out of or
as a result of the interpretation of this Agreement or the financing provided
for hereunder, including, but not limited to, all fees and expenses for the
service and filing of papers, premiums on bonds and undertakings, fees of
marshals, sheriffs, custodians, auctioneers and others, travel expenses and all
court costs and collection charges), postage, wire transfer fees, check dishonor
fees and other internal and/or external fees, costs and expenses arising out of
or relating to the negotiations, preparation, consummation, administration and
enforcement of this Agreement or any other agreement between Borrower and Lender
including, but not limited to any guaranty of the Obligations (as defined
herein).

    

    1.8           "Eligible Accounts"
means Accounts arising in the ordinary course of Borrower's business from the
sale of goods or rendition of services, which Lender, in its reasonable business
discretion, shall deem eligible based on such considerations as Lender may from
time to time deem appropriate.  Without limiting the foregoing, a
Account shall not be deemed to be an Eligible Account if (i) the Account Debtor
has failed to pay the Account within a period of ninety (90) days after invoice
date; (ii) the account debtor has failed to pay more than 25% of all outstanding
Accounts owed by it to Borrower within ninety (90) days after invoice date;
(iii) the Account Debtor's total obligations to Borrower exceed 15% of all
Eligible Accounts, to the extent of such excess; (iv) the Account Debtor is a
subsidiary or affiliate of Borrower; (v) the goods relating thereto are placed
on consignment, guaranteed sale, “bill and hold,” “COD” or other terms pursuant
to which payment by the Account Debtor may be conditional; (vi) the Account
Debtor is not located in the United States unless the Account is supported by a
letter of credit or other form of guaranty or security, in each case in form and
substance satisfactory to Lender; (vii) the Account Debtor is the United States
or any department, agency or instrumentality thereof or any State, city or
municipality of the United States, except as otherwise agreed to in writing by
Lender; (viii) Borrower is or may become liable to the account debtor for goods
sold or services rendered by the account debtor to Borrower; (ix) the Account
Debtor disputes liability or makes any claim with respect thereto, or is subject
to any insolvency or bankruptcy proceeding, or becomes insolvent, fails or goes
out of a material portion of its business; (x) the amount thereof consists of
late charges or finance charges; (xi) the amount thereof consists of a credit
balance more than ninety (90) days past due; (xii) the invoice constitutes a
progress billing on a project not yet completed, except that the final billing
at such time as the matter has been completed and delivered to the customer may
be deemed an Eligible Account; (xiii) the amount thereof is not yet represented
by an invoice or bill issued in the name of the applicable Account Debtor; (xiv)
the amount thereof is denominated in or payable with any currency other than
U.S. Dollars; or (xv) such Account is not at all times subject to Lender’s duly
perfected first priority security interest.  In determining
eligibility, Lender may, but need not, rely on agings, reports and schedules of
Accounts furnished by Borrower but reliance by Lender thereon from time to time
shall not be deemed to limit its right to revise standards of eligibility at any
time without notice as to both Borrower's present and future
Accounts.

     

    
      
        
        

      

      
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    1.9.           "Facility Fee" shall
have the meaning set forth in the Loan Schedule.

    

    1.10.         "Line of Credit" as
used herein is $250,000.00 or such other
amount as shall be determined at Lender's reasonable business
discretion.

    

    1.11.         "Loan Documents"
means, collectively, this Agreement, any note or notes executed by Borrower and
payable to Lender, and any other present or future agreement entered into in
connection with this Agreement, together with all alterations, amendments,
changes, extensions, modifications, refinancings, refundings, renewals,
replacements, restatements, or supplements, of or to any of the
foregoing.

     

    1.12.         “Loan Party” "means
Borrower, each guarantor and each other party (other than Lender) to any Loan
Document.

    

    1.13.         "Minimum Interest
Charge" shall have the meaning set forth in the Loan
Schedule.

    

    1.14.         "Net Amount of Eligible
Accounts" shall mean the gross amount of Eligible Accounts less sales,
excise or similar taxes, and less returns, discounts, claims, credits, reserves
(as determined by Lender in its sole discretion) and allowances of any nature at
any time issued, owing, granted, outstanding, available or claimed.

    

    1.15.         "Obligations" shall
mean any and all loans, advances, accommodations, indebtedness, liabilities,
Costs and Expenses and all obligations of every kind and nature owing by
Borrower to Lender, however evidenced, whether as principal, guarantor or
otherwise, whether arising under this Agreement, any supplement hereto, or
otherwise, whether now existing or hereafter arising, whether direct or
indirect, absolute or contingent, joint or several, due or not due, primary or
secondary, liquidated or unliquidated, secured or unsecured, original, renewed,
modified or extended, and whether arising directly or acquired from others
(including, without limitation, wherever applicable, Lender's participations or
interests in Borrower's obligations to others) and including, without
limitation, all sums chargeable to Borrower hereunder or under any of the other
Loan Documents, of whatever nature, including commissions, interest, expenses,
costs and attorneys' fees.  Borrower shall be jointly and
severally liable for all of the Obligations hereunder and under any other
agreement between Lender and any Borrower.

    

    1.16.         "Person" means any
individual, sole proprietorship, partnership, joint venture, trust,
unincorporated organization, association, corporation, limited liability
company, government, or any agency or political division thereof, or any other
entity.

    

    
      	
              SECTION
      2.

            	
                 LOANS AND ADVANCES; INTEREST RATE AND
      OTHER CHARGES

            

    

    

    2.1.           Loans.  Whenever
the Borrower makes a request (but not more frequently than twice a week unless
Lender consents), Lender shall make loans, advances and/or extend credit to or
for the Borrower; but Lender shall not be obligated to make loans, advances
and/or extend credit beyond the Line of Credit set forth in the Loan Schedule
and subject to deduction of any loan reserves (“Loan
Reserves”) Lender deems proper from time to time in its reasonable
business discretion, and less amounts Lender may be obligated to pay in the
future on behalf of Borrower.  Advances under the Line of Credit
(“Loans”
and individually, a “Loan”)
shall be comprised of the amounts shown on the Loan Schedule.

     

    
      
        
        

      

      
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    2.2           Interest and
Fees.  The Borrower shall pay Lender the interest and fees set
forth on the Loan Schedule, but only to the maximum extent permitted by
applicable law.  Borrower shall pay principal, interest, and all other
amounts payable hereunder, or under any other Loan Document, without any
deduction whatsoever, including, but not limited to, any deduction for any
setoff or counterclaim.  In no event shall the Revolving Interest
Rate or the Default Rate of Interest exceed the highest rate permitted
under any applicable law or regulation.  If any part or provision of
this Agreement is in contravention of any such law or regulation, such part or
provision shall be deemed amended to conform thereto, and any payment of
interest and fees which individually or collectively might be deemed to be in
excess of the highest rate permitted by law shall be credited against Borrower's
Obligations as principal repayments of loans and advances made hereunder, to the
extent of such excess.

    

    2.3           Overlines;
Overadvances.  If at any time or for any reason the outstanding
amount of advances extended or issued pursuant hereto exceeds any of the dollar
limitations (“Overline”)
or percentage limitations (“Overadvance”)
in the Loan Schedule on any day in any month, then Borrower shall, upon Lender's
demand, immediately pay to Lender, in cash, the full amount of such Overline or
Overadvance which, at Lender’s option, may be applied to reduce the outstanding
principal balance of the Loans or any other Obligations.  Without
limiting Borrower's obligation to repay to Lender on demand the amount of any
Overline or Overadvance, Borrower agrees to pay Lender interest on the
outstanding principal amount of any Overline or Overadvance, on demand, at the
rate set forth on the Loan Schedule, whether any such Overline or Overadvance is
made with or without Lender's knowledge or consent.

     

    2.4.           (a)         Establishment of a Lockbox
Account or Dominion Account.  Borrower shall cause all proceeds
of Collateral to be remitted directly to Lender by instructing its Account
Debtors to direct their payments as follows:

     

    Name
of Borrower

    Accounting
Department

    505
Park Avenue, 6th
Floor

    New
York, NY 10022

     

    (b)           Lender
may, at any time and from time to time, direct Borrower to collect and deliver
to Lender in their original form, on the same date as the date of the actual
receipt thereof, all checks, drafts, notes, acceptances, cash, wire transfers
and any other evidences of payment, and/or direct Borrower to cause all proceeds
of Collateral to be deposited into a lock box account or other blocked account
as Lender may require or take any other action Lender may require.

     

    2.5.         Clearance or Float
Days.  In computing interest on the Obligations, all checks,
wire transfers and other items of payment received by Lender (including proceeds
of Accounts and payment of the Obligations in full) shall be deemed applied by
Lender on account of the Obligations on the day such payment is received or, if
received after 12noon New York, NY time, the next business
day.  However, Lender shall be entitled to charge Borrower’s account
five (5) business days of “clearance” or “float” at the Revolving Interest Rate
set forth in the Loan Schedule, on all checks, wire transfers and other items
received by Lender, regardless of whether such five (5) business days of
clearance or float actually occur, and such charge shall be deemed to be the
equivalent of charging five (5) business days of interest on such payments
and/or collections.  The five (5) business days clearance or float
charge on all payments and collections is acknowledged by the parties to
constitute an integral aspect of the pricing of Lender’s financing to
Borrower.  Lender shall not, however, be required to credit Borrower’s
account for the amount of any item of payment which is unsatisfactory to Lender,
in Lenders reasonable business discretion, and Lender may charge Borrower’s loan
account for the amount of any item of payment which is returned to Lender
unpaid.

    

    2.6.         Application of Collateral
and Payments.  Except as otherwise provided herein, Lender
shall have the continuing and exclusive right to apply or reverse and re-apply
any and all payments to any portion of the Obligations in such order and manner
as Lender shall determine in its reasonable business discretion.  To
the extent that Borrower makes a payment or Lender receives any payment or
proceeds of the Collateral for Borrower’s benefit that is subsequently
invalidated, set aside or required to be repaid to any other Person, then, to
such extent, the Obligations intended to be satisfied shall be revived and
continue as if such payment or proceeds had not been received by Lender and
Lender may adjust the Loan balances, in its reasonable business
discretion.

     

    
      
        
        

      

      
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    2.7.           Monthly
Accountings.  All Obligations shall be charged to an account in
the Borrower's name as maintained on Lender's books.  Lender shall
render to Borrower a monthly statement of its account which statement shall be
deemed correct, accepted by, and conclusively binding upon Borrower as an
account stated, except to the extent that Borrower shall deliver to Lender
written notice of any specific exceptions thereto within twenty (20) days after
the date such statement is rendered.

     

    2.8.           Charges to Borrower’s
Account.  All principal, interest, fees (including
Documentation Fees), commissions, charges, Costs and Expenses incurred with or
in respect of this Agreement, the other Loan Documents or any supplement or
amendment hereto or thereto (all of which shall be cumulative and not exclusive)
and any and all Obligations shall be charged to Borrower's account as maintained
by Lender.  In furtherance thereof, Borrower hereby authorizes Lender
to charge the Borrower's loan account on the first day of each month or as
Lender otherwise determines: (a) all Costs and Expenses; (b) all interest; and
(c) all fees and other charges provided in this Agreement and the other Loan
Documents.

     

    
      
        	
                SECTION 3.

              	
                   GRANTING PROVISIONS; SECURITY
      INTEREST

              

      

    

    

    3.1       
    Grant of
Security.  As security for the prompt performance, observance
and payment in full of all Obligations, Borrower hereby pledges, assigns,
transfers and grants to Lender a first priority security interest in, and
continuing lien upon, and right of setoff against, all of the assets of every
kind and nature of Borrower, in each case, whether now owned or existing or
hereafter created, acquired or arising and wherever located, all of which are
herein collectively referred to as the "Collateral" including but not
limited to, the following assets as defined under the UCC: (a) Accounts,
contract rights and the proceeds thereof;  (b) Chattel Paper,
including Electronic Chattel Paper and tangible Chattel Paper;  (c)
Collateral;  (d) Commercial Tort Claims;  (e) Deposit
Accounts;  (f) Documents;  (g) Equipment, machinery,
furniture, furnishings and fixtures and all parts, tools, accessories and
Accessions;  (h) Fixtures;  (i) General Intangibles,
including but not limited to patents, trademarks and tradenames and the goodwill
and inherent value associated therewith, tax refunds, customer lists, insurance
claims and goodwill of Borrower;  (j) Goods;  (k) Health
Care Insurance Receivables;  (l) Instruments;  (m)
Inventory, merchandise, materials, whether raw, work in progress or finished
goods, packaging and shipping materials and all other tangible property held for
sale or lease;  (n) Investment Property;  (o) Letter of
Credit Rights;  (p) Payment Intangibles; (q) Proceeds, including Cash
Proceeds and Non-Cash Proceeds, and proceeds of any insurance policies covering
any of the Collateral;  (r) Promissory Notes;  (s) Records,
including all books, records and other property at any time evidencing or
relating to any of the foregoing, and all electronic means of storing such
Records;  (t) to the extent not otherwise included above, all
collateral support and Supporting Obligations relating to any of the foregoing;
and  (u) to the extent not otherwise included above, all Proceeds,
products, accessions, rents and profits of or in respect of any of the
foregoing.  The security interests granted herein shall remain
effective whether or not the Collateral covered thereby is acceptable to Lender
or deemed by Lender to be ineligible for the purposes of any Loans or advances
contemplated under this Agreement.

    

    3.2.           Authorization to
File Financing Statements.  Borrower
hereby authorizes Lender to execute and/or file UCC financing statements
(including amendments) in order to perfect the security interests granted to
Lender under this Agreement, the other Loan Documents or otherwise.

     

    3.3.           Assignment of Accounts and
Other
Collateral.  Borrower shall assign and deliver to Lender a
duplicate and/or original invoice, and all original documents evidencing the
delivery of goods or the performance of services with regard to each Account,
including but not limited to all original contracts, purchase orders, invoices,
time sheets, bills of lading, warehouse receipts, delivery tickets and shipping
receipts, together with schedules describing the Accounts and/or written
confirmatory assignments to Lender of each Account, in form and substance
satisfactory to Lender and duly executed by Borrower, together with such other
information as Lender may request.  In no event shall the making (or
the failure to make) of any schedule or assignment or the content of any
schedule or assignment or Borrower's failure to comply with the provisions
hereof be deemed or construed as a waiver, limitation or modification of
Lender's security interest in, lien upon and assignment of the Collateral or
Borrower's representations, warranties or covenants under this Agreement or any
supplement or amendment hereto.

     

    
      
        
        

      

      
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                SECTION 4.

              	
                 REPRESENTATIONS, WARRANTIES AND
      COVENANTS

              

      

    

    

    Borrower hereby represents, warrants
and covenants to Lender the following (which shall survive the execution and
delivery of this Agreement), the truth and accuracy of which, and continuing
compliance with, being a continuing condition of the making of all loans and
advances hereunder by Lender or under any supplement or amendment
hereto:

    

    4.1.         Owner of
Collateral;
Validity of Accounts.

    

    (a)           Borrower
is and shall be the owner of or has other rights in the Collateral free and
clear of all liens, security interests, claims and encumbrances of every kind
and nature, except in Lender's favor or as otherwise consented to in writing by
Lender, and Borrower shall indemnify and defend Lender from and against all
cost, loss and expense with regard to the same.  None of Borrower's
Accounts has been previously sold or assigned to any Person and will not be sold
or assigned, other than to Lender, at any time during the term of this Agreement
without first obtaining Lender's consent in writing.  Borrower shall
not execute any security agreement in favor of any other party or borrow against
the security of any corporate asset, including but not limited to the
Collateral, or authorize and Person other than Lender to file UCC financing
statements naming Borrower as Debtor, without first obtaining Lender's consent
in writing.

    

    (b)           Each
Account represents a valid and legally enforceable indebtedness based upon a
bona fide sale and delivery of goods or rendition of services usually dealt in
by Borrower in the ordinary course of its business which has been finally
accepted by the Account Debtor.  Each Account is and will be for a
liquidated amount maturing as stated in the invoice rendered to the Account
Debtor who is unconditionally liable to make payment at maturity of the amount
stated in each invoice, document or instrument evidencing the Account in
accordance with the terms thereof, without offset, defense, deduction,
counterclaim, discount or condition.  Every assigned Account and any
evidence of indebtedness with respect thereto shall be paid in full at
maturity.  If any Account is not paid in full at maturity, the amount
of such unpaid Account (whether in whole or in part) may be charged against and
deducted from any advance then or thereafter made by Lender to Borrower or, in
the event Borrower then has no borrowing availability, Borrower shall pay
Lender, upon demand, the full amount remaining unpaid thereon.  Such
payment or deduction shall not constitute a reassignment, and Lender may retain
the Account as collateral for all Obligations of Borrower to Lender until the
same have been fully satisfied.

    

    (c)           All
statements made and all unpaid balances appearing in the invoices, documents and
instruments evidencing each Account are true and correct and are in all respects
what they purport to be and all signatures and endorsements that appear thereon
are genuine and all signatories and endorsers have full capacity to
contract.  Each Account Debtor is solvent and financially able to pay
in full each Account when it matures.  None of the transactions
underlying or giving rise to any Account shall violate any state or federal laws
or regulations, and all documents relating to the Accounts shall be legally
sufficient under such laws or regulations and shall be legally enforceable in
accordance with their terms and all recording, filing and other requirements of
giving public notice under any applicable law have been and shall be duly
complied with.

     

    
      
        
        

      

      
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    (d)           Without
first obtaining Lender's consent in writing Borrower will not directly or
indirectly sell, lease, transfer, abandon or otherwise dispose of all or any
portion of the Collateral (except in the ordinary course of business) or
consolidate or merge with or into any other entity or permit any other entity to
consolidate or merge with or into Borrower.

    

    4.2.          Corporate
Authority.

    

    (a)      
     The execution, delivery and performance of this
Agreement, any supplement or amendment hereto, or any agreements, instruments
and documents executed and delivered in connection herewith, are within
Borrower's corporate powers, have been duly authorized, are not in contravention
of law or the terms of Borrower's charter, by-laws or other incorporation
papers, or of any indenture, agreement or undertaking to which Borrower is a
party or by which Borrower is bound.

    

    (b)      
     The Loan Schedule annexed hereto and incorporated
herein by reference sets forth the Borrower's exact legal name, the Borrower's
type of organization, the jurisdiction in which Borrower was organized, the
Borrower's organizational identification number or accurately states that the
Borrower has none, the Borrower's place of business or if more than one, its
chief executive office as well as all other locations including the Borrower's
mailing address if different, the address of every location or place of business
previously maintained by the Borrower during the past five years and the
location at which, or Person with which, any of the Collateral has been
previously held at any time during the past twelve months;

    

    (c)    
       Borrower is in good standing as a
corporation or other legal entity, validly existing under the laws of its state
of incorporation or organization, and will preserve, renew and keep in full
force and effect Borrower's existence and good standing as a corporation or
other legal entity and its rights and franchises with respect thereto and will
not change its state of incorporation or organization;

    

    (d)    
       Borrower shall obtain and preserve,
renew and keep in full force and effect Borrower's authority to do business in
all jurisdictions where the Borrower now or hereafter does
business;

    

    (e)    
       Borrower will continue to engage in a
business of the same type as Borrower is engaged as of the date
hereof;

    

    (f)     
      Borrower will give Lender thirty (30) days
prior written notice of any proposed change in Borrower's legal  name
which notice shall set forth the new name; and

    

    (g)           Borrower
will give Lender thirty (30) days prior written notice of any use of any
corporate name or tradename in addition to those names set forth on the annexed
Loan Schedule.

    

    4.3.          Chief Executive
Office.  Borrower's Records and principal executive office are
maintained at the address referred to herein.  Borrower shall not
change such location without Lender's prior written consent.

    

    4.4.          Books, Records, Financial
Statements.

    

    (a)  
         Borrower shall maintain
its shipping forms, invoices and other related documents in a form satisfactory
to Lender and shall maintain its books, records and accounts in accordance with
generally accepted accounting principles consistently
applied.  Borrower agrees to promptly furnish Lender monthly but in no
event later than ten (10) days after the end of each month, accounts receivable
agings, together with reconciliation and recap sheets, accounts payable agings
and inventory reports (if requested by Lender).

    

    (b)           Borrower
shall furnish to Lender, as soon as available, but in any event not later than
ninety days (90) after the close of each fiscal year, Borrower’s reviewed
financial statements for such fiscal year (including balance sheets, statements
of income and loss, statements of cash flow and statements of shareholders'
equity), and the accompanying notes thereto, setting forth in each case, in
comparative form, figures for the previous fiscal year, all in reasonable
detail, fairly representing the financial position and the results of Borrower’s
operations as at the date thereof and for the fiscal year then ended and
prepared in accordance with generally accepted accounting principles
consistently applied.  Such reviewed statements shall be examined in
accordance with generally accepted auditing practices and certified by
independent certified public accountants selected by Borrower and acceptable to
Lender.

     

    
      
        
        

      

      
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    (c)    
       Borrower shall also furnish to Lender,
as Lender may reasonably request, quarterly or monthly unaudited financial
statements (including balance sheets, statements of income and loss, statements
of cash flows and statements of shareholders' equity) and the accompanying notes
thereto, all in reasonable detail, fairly presenting the financial position and
results of Borrower’s operation as at the date thereof and for such period
prepared in accordance with generally accepted accounting principles
consistently applied and such other information with respect to your business,
operations and condition (financial and otherwise) as Lender may from time to
time reasonably request. Such financial statements shall be certified for
accuracy by Borrower’s chief financial officer.

    

    (d)           Borrower
hereby irrevocably authorizes and directs all accountants, auditors and any
other third parties to deliver to Lender, at Borrower's expense, copies of
Borrower's financial statements, papers related thereto, and other accounting
records of any kind or nature in their possession and to disclose to Lender any
information they may have regarding Borrower's business affairs and financial
condition.

    

    4.5.          Further
Information.  Lender shall have the right to request and
receive from the Borrower's agents, employees, attorneys and accountants all
information pertaining to the Borrower which Lender may reasonably request, and
such persons are hereby authorized and directed by the Borrower to furnish such
information, subject to applicable laws regarding privileged
communications.

    

    4.6.          Solvency; Taxes.

    

    (a)           Borrower
is solvent and will so remain.

    

    (b)          Borrower's
federal, state and local taxes of every kind and nature, including, but not
limited to employment taxes, are current, and there are no pending tax audits or
examinations with respect to Borrower's federal, state or local tax
returns.

    

    (c)           Borrower
shall duly pay and discharge all taxes, assessments, contributions and
governmental charges upon or against it or its properties or assets prior to the
date on which penalties attach thereto.  Borrower shall be liable for
all taxes and penalties imposed upon any transaction under this Agreement or any
supplement or amendment hereto or giving rise to the Accounts or any other
Collateral or which Lender may be required to withhold or pay for any
reason.  Borrower agrees to indemnify and hold Lender harmless with
respect thereto, and to repay to Lender on demand the amount thereof, and until
paid by Borrower such amounts shall be added to and included in Borrower's
Obligations.

    

    4.7.          Litigation.  There
is no investigation by any state, federal or local agency pending or threatened
against Borrower and there is no action, suit, proceeding or claim pending or
threatened against Borrower or Borrower's assets or goodwill or affecting any
transactions contemplated by this Agreement, or any supplement or amendment
hereto, or any agreements, instruments or documents delivered in connection
herewith or therewith before any court, arbitrator, or governmental or
administrative body or agency which if adversely determined with respect to
Borrower would result in any material adverse change in Borrower's business,
properties, assets, goodwill or condition, financial or otherwise.

    

    4.8.          Sales, Accounting and
Assignment.  Borrower
shall keep and maintain, at its sole cost and expense, satisfactory and complete
Records including records of all Accounts, all payments received and credits
granted thereon, and all other dealings therewith.  Upon the sale of
goods or the rendering of services, Borrower shall make appropriate entries in
its books and records disclosing such assignments of Accounts to Lender, and
shall execute and deliver all papers and instruments, and do all things
necessary to effectuate this Agreement and facilitate the collection of the
Accounts.  Lender is hereby vested with all of Borrower's rights,
securities and guarantees with respect to each Account, including the right of
stoppage in transit.  Notwithstanding the failure of Borrower to
execute and deliver such written assignment as aforesaid, each Account created
by Borrower shall be deemed assigned to Lender and shall become its
property.

     

    
      
        
        

      

      
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    4.9.          Collections.  In
the event payments of Accounts or other monies or property in which Lender has
an interest are delivered to or received by Borrower, including proceeds from
the sale of Collateral in the ordinary course of Borrower’s business, unless
otherwise consented to in writing by Lender or specifically permitted under
Section 2.4 herein, Borrower shall hold all such remittances and proceeds of
Accounts and other Collateral, in trust for Lender.  Borrower shall
deliver all such payments to Lender, in kind with an appropriate endorsement to
Lender, on the next business day following the date of receipt by Borrower;
provided, however, nothing
herein authorizes Borrower to collect the Accounts unless specifically consented
to by Lender.

    

    4.10.        Further
Acts.  Borrower shall, at Borrower's expense, duly execute and
deliver, or shall cause to be duly executed and delivered, such further
agreements, instruments and documents, including, without limitation, additional
security agreements, mortgages, deeds of trust, deeds to secure debt, collateral
assignments, UCC financing statements or amendments and continuations thereof,
landlord's or mortgagee's waivers of liens and consents to the exercise by
Lender of all of its rights and remedies hereunder, under any supplement or
amendment hereto, or applicable law with respect to the
Collateral.  In addition, Borrower shall do or cause to be done such
further acts as may be necessary or proper, in Lender's opinion, to evidence,
perfect, maintain and enforce its security interest and the priority thereof in
and to the Collateral and to otherwise effect the provisions and purposes of
this Agreement or any supplement or amendment hereto.  Borrower hereby
authorizes Lender to execute and file UCC financing statements in order to
perfect the security interests granted to Lender under this Agreement or
otherwise, including amendments and modification statements deemed reasonably
necessary by Lender to perfect and protect Lender’s interest in the
Collateral.

    

    4.11.        Insurance.  Borrower
shall, at Borrower's expense, maintain insurance covering the Collateral in such
amounts and with such insurance companies as may be acceptable to Lender in its
sole and absolute discretion.  Borrower shall have Lender named as
mortgagee, loss payee and additional insured on all such insurance
policies.  In the event Borrower shall fail to maintain insurance
acceptable to Lender, Lender without notice, may obtain such insurance in the
name of the  Borrower and charge Borrower's account with the costs and
expenses of such insurance. All expenses incurred by Lender with regard to such
insurance policies shall be deemed part of the Obligations.

    

    4.12.        Margin
Stock.  The Borrower is not engaged principally, or as one of
its important activities, in the business of extending credit for the purpose of
purchasing or carrying margin stock (within the meaning of Regulation G issued
by the Board of Governors of the Federal Reserve System), and no proceeds of any
Loan or advances made by Lender to Borrower will be used to purchase or carry
any margin stock or to extend credit to others for the purpose of purchasing or
carrying any margin stock, or in any manner which might cause such loan or
advance or the application of such proceeds to violate (or require any
regulatory filing under) Regulation G, Regulation U, or Regulation X of the
Board of Governors of the Federal Reserve System, in each case as in effect on
the date or dates of such loan or advance and such use of
proceeds.  Further, no proceeds of any loan or advance will be used to
acquire any security of a class which is registered pursuant to Section 12 of
the Securities Exchange Act of 1934.

    

    4.13.        Loan Proceeds for
Ordinary Business Use Only.  Any
loan at any time received by the Borrower from Lender shall not be used directly
or indirectly other than in the Borrower's business; it shall not, directly or
indirectly, pay any dividend on its stock other than a dividend payable in
shares of its own stock; it shall not, directly or indirectly, make any loan to,
or pay any claim other than for current remuneration or current reimbursable
expense payable to any person controlling, controlled by or under common control
with the Borrower, and it shall, on demand, obtain and deliver to Lender
subordinations in form and substance satisfactory to Lender of all claims of
controlling and controlled persons consistent with the foregoing.

    

    4.14.        Commercial Tort
Claim.  The Borrower shall immediately notify Lender in a
writing signed by the Borrower of any commercial tort claims it holds or
acquires such writing shall set forth the details and grant Lender a security
interest in and to any commercial tort claims it holds or acquires and in the
proceeds thereof, such writing to be satisfactory to Lender in form and
substance.

    

    
      
        	
                SECTION 5.

              	
                  ADDITIONAL POWERS; ENFORCEMENT OF
      RIGHTS IN AND TO
COLLATERAL

              

      

    

    

    5.1.          Power of
Attorney.  Borrower appoints Lender and Lender’s designees as
Borrower's attorney and attorney-in-fact, at Borrower’s sole cost and expense,
and Lender may exercise at any time, in Lender’s reasonable business discretion,
all or any of the following powers which, being coupled with an interest, shall
be irrevocable until all Obligations have been paid in full and Lender’s
obligation to provide loans hereunder shall have terminated:

    

    (a)           endorse
Borrower's name on any checks, notes, acceptances, money orders or other forms
of payment or security that come into Lender’s possession;

     

    
      
        
        

      

      
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    (b)           sign
Borrower's name on any invoice or bill of lading relating to any Account, on
drafts against Account Debtors, on assignments of Accounts, on notices of
assignment, financing statements and other public records, on verifications of
accounts and on notices to Account Debtors;

    

    (c)           send
requests for verification of Accounts to Account Debtors and, after the
occurrence of any Event of Default, to notify Account Debtors to make payment
directly to Lender;

    

    (d)           after
the occurrence of any Event of Default, to notify the post office authorities to
change the address for delivery of Borrower's mail to an address designated by
Lender and to open and dispose of all mail addressed to Borrower;
and

    

    (e)     
      to do all other things Lender deems
necessary or desirable to carry out the terms of this Agreement.

    

    (f)       
    Borrower hereby ratifies and approves all acts of such
attorney.  Neither Lender nor any of its designees shall be liable for
any acts or omissions nor for any error of judgment or mistake of fact or law
while acting as Borrower's attorney and Borrower hereby releases Lender and
Lender's officers, employees and designees, from all liability arising from any
act or acts under this Agreement or in furtherance thereof, whether by omission
or commission, and whether based upon any error of judgment or mistake of law or
fact.

    

    5.2.          Access to Books, Records and
Collateral.  Lender or Lender's representatives shall at all
times have free access to and right of inspection of the Collateral and have
full access to and the right to examine and make copies of Borrower's Records,
to confirm and verify all Accounts, to perform general audits and field
examinations and to do whatever else Lender deems necessary to protect Lender's
interests.  Lender may at any time remove from Borrower's premises or
require Borrower or its accountants or auditors to deliver any Records to
Lender.  Lender may, at Borrower's cost and expense, use any of
Borrower's personnel, supplies, computer equipment (including all computer
programs, software and data) and space at Borrower's places of business or at
any other place as Lender may designate, as may be reasonably necessary for the
handling of collections.

    

    5.4.          Returns;
Credits.  All returns of merchandise, credits issued by
Borrower, claims or disputes of Account Debtors whether or not accepted by
Borrower or given an allowance of any nature shall be reported by Borrower to
Lender at least weekly.  Each such report shall be accompanied by
copies of all documentation provided to Borrower in support of all merchandise
returns, credits, claims and disputes.  Borrower shall immediately
upon obtaining knowledge thereof, report to Lender all reclaimed, repossessed
and returned goods, Account Debtor claims and any other matter affecting the
value, enforceability or collectability of Accounts.  At Lender's
request, any goods reclaimed or repossessed by or returned to Borrower will be
set aside, marked with Lender's name and held by Borrower (at Borrower's place
of business or at such other place as Lender may designate) for Lender's account
and subject to Lender's security interest.  Notwithstanding the
foregoing, Lender may require Borrower to pay to Lender the original invoice
price of such reclaimed, repossessed or returned goods.  In case any
such goods shall be re-sold, the Account thereby created shall be Lender's
property and shall be deemed assigned hereunder.

    

    5.5          Disputes.  All
claims and disputes relating to Accounts shall be adjusted within a reasonable
time at Borrower's own cost and expense.

    

    
      	
              SECTION 6.

            	
              DEFAULTS
      AND REMEDIES.

            

    

    

    6.1.         The
occurrence of any one or more of the following constitute events of default
(“Events of
Default”):

    

    (a)           The
breach by the Borrower of any of the terms, representations, warranties,
covenants, conditions or provisions of this Agreement of any of the Loan
Documents or any supplement or amendment hereto or thereto, which, provided it
shall not constitute any other Event of Default, shall remain uncured for more
than ten (10) days after notice thereof to the Borrower; or

     

    
      
        
        

      

      
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    (b)           The
failure of the Borrower to pay any Obligation to Lender calling for the payment
of money pursuant to this Agreement or any of the Loan Documents, as and when
the same should be paid; the Borrower becoming insolvent or otherwise fails to
meet its or their debts as they mature; the Borrower suspending or discontinuing
its business for any reason; the Borrower commencing or having commenced against
it a petition for a receivership of its business or property or a bankruptcy or
any other legal proceeding or action relating to the relief of debtors or the
readjustment of debts; the Borrower making an assignment for the benefit of
creditors, seeking a composition of creditors or calling a meeting of creditors
or have a creditors' committee appointed; or Borrower suffering a lien against
or judgment or the attachment of any of its property (which has not been bonded
or otherwise secured); having a receiver, custodian or trustee of any kind is
appointed with regard to any property of Borrower; the Borrower disposing of any
property included in the Collateral otherwise than in accordance with this
Agreement; the Borrower committing or suffering, by any of its agents or
employees, a fraudulent conversion of any part of the Collateral; or, insofar as
property of the type included in the Collateral is involved, the Borrower
breaching a representation or covenant contained in this Agreement or any of the
Loan Documents.

    

    (c)        
   Any material adverse change occurs in Borrower's business,
assets, operations, prospects or condition, financial or otherwise, or the
prospect of repayment of any portion of the Obligations or the value or priority
of Lender’s security interest in the Collateral is materially
impaired;

    

    (d)      
     Any default shall occur under any material
agreement between Borrower and any third party including, without limitation,
any default which would result in a right by such third party to accelerate the
maturity of any indebtedness of Borrower to such third party;

    

    (e)     
      Any representation or warranty made or
deemed to be made by Borrower, any affiliate or any other Loan Party in any Loan
Document or any other statement, document or report made or delivered to Lender
in connection therewith shall prove to be false or misleading or the failure to
disclose any material disclosure which if disclosed shall prove to have been
misleading in any material respect;

    

    (f)        
   Any guarantor of the Obligations hereunder dies, terminates or
attempts to terminate its guaranty or any security therefore or becomes subject
to any bankruptcy or other insolvency proceeding; or

    

    (g)     
      Any transfer of a controlling interest of
the issued and outstanding shares of common stock or other evidence of ownership
of Borrower.

    

    NOTWITHSTANDING
ANYTHING TO THE CONTRARY HEREIN, LENDER RESERVES THE RIGHT TO CEASE MAKING ANY
LOANS DURING ANY CURE PERIOD STATED ABOVE, AND THEREAFTER IF AN EVENT OF DEFAULT
HAS OCCURRED.

     

    
      
        
        

      

      
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    6.2.  
        REMEDIES.

    

    (a)     
      Upon the occurrence of an Event of Default,
Lender may, at its option and in its sole discretion and in addition to all of
its other rights under the UCC, this Agreement, and the other Loan Documents,
cease making advances or Loans, charge the Default Rate of Interest on all
Obligations, terminate this Agreement and/or declare all of the Obligations to
be immediately payable in full.  Borrower agrees that Lender
shall also have all of its rights and remedies under applicable law, including
without limitation, the default rights and remedies of a secured party under the
UCC (which includes the right to notify Account Debtors of the Borrower to make
payment directly to Lender), and upon the occurrence of an Event of Default,
Borrower hereby consents to the appointment of a receiver by Lender in any
action initiated by Lender pursuant to this Agreement and to the jurisdiction
and venue set forth in this Agreement, and Borrower waives notice and posting of
a bond in connection therewith.

    

    (b)           Lender
is authorized and empowered at any time upon the occurrence and continuation of
an Event of Default, to compromise or extend the time for payment of any
Account, for such amounts and upon such terms as Lender may, in its sole
discretion determine and to accept the return of the merchandise represented by
any Account, all without notice to or consent by Borrower, and without
discharging or affecting Borrower's Obligations hereunder to any extent, and
Borrower will, upon demand, pay to Lender the amount of any allowance given or
authorized by Lender hereunder.

    

    (c)       
    Lender may, at any time upon the occurrence and
continuation of an Event of Default, take possession of the Collateral and keep
it on Borrower's premises, at no cost to Lender, or remove any part of it to
such other place(s) as Lender may desire, or Borrower shall, upon Lender’s
demand, at Borrower's sole cost, assemble the Collateral and make it available
to Lender at a place reasonably convenient to Lender.  In the event
Lender seeks to take possession of all or any portion of the Collateral by
judicial process (including, but not limited to, Lender obtaining an order of
attachment, a temporary restraining order, a preliminary or permanent injunction
or otherwise) against the Borrower or with regard to the Collateral, Borrower
irrevocably waives the posting of any bond, surety or security with respect
thereto which might otherwise be required, any demand for possession prior to
the commencement of any suit or action to recover the Collateral, and any
requirement that Lender retain possession and not dispose of any Collateral
until after trial or final judgment.

    

    (d)           Lender
shall have the right in such manner and upon such terms as Lender shall
determine in Lender’s reasonable business discretion, to enforce payment of any
Collateral, to settle, compromise or release in whole or in part, any amounts
owing on any Collateral, to prosecute any action, suit or proceeding with
respect to the Collateral, to extend the time of payment of any and all
Collateral, to make allowances and adjustments with respect thereto, to issue
credits in Lender's or Borrower's name, to sell, assign and deliver the
Collateral (or any part thereof) at public or private sale, for cash, upon
credit or otherwise at Lender's sole option and discretion, and Lender may bid
or become purchaser at any such sale, free from any right of redemption which is
hereby expressly waived.  Borrower agrees that Lender has no
obligation to preserve rights to the Collateral or marshaling any Collateral for
the benefit of any Person.  Lender may sell the Collateral without
giving any warranties as to the Collateral and may specifically disclaim any
warranties of title or the like without affecting the commercial reasonableness
of the sale of any of the Collateral.  Lender is hereby granted a
license or other right to use, without charge, Borrower's labels, patents,
copyrights, name, trade secrets, trade names, trademarks and advertising matter,
or any similar property, in completing production, advertising or selling any
Collateral and Borrower's rights under all licenses and all franchise agreements
shall inure to Lender's benefit.  Borrower agrees that the giving of
five (5) days' notice by Lender, sent by ordinary mail, postage prepaid, to
Borrower's address set forth herein, designating the place and time of any
public sale or of the time after which any private sale or other intended
disposition of the Collateral is to be made, shall be deemed to be reasonable
notice thereof and Borrower waives any other notice with respect
thereto.

    

    (e)           The
net cash proceeds, after deducting all costs and expenses of sale (including
attorneys’ fees and other professional fees), resulting from the exercise of any
of Lender's rights or remedies under this Agreement, the UCC or other applicable
law, shall be applied by Lender to the payment of the Obligations in such order
as Lender may elect, in Lender’s sole discretion.  Lender shall return
any excess to Borrower and Borrower shall remain liable to Lender for any
deficiency, to the fullest extent permitted by law.  Without limiting
the generality of the foregoing, if Lender enters into any credit transaction,
directly or indirectly, in connection with the disposition of any Collateral,
Lender shall have the option, at any time, in Lender's sole and absolute
discretion, to reduce the Obligations by the amount of such credit transaction
or any part thereof or to defer the reduction thereof until actual receipt by
Lender of cash in connection therewith.

     

    
      
        
        

      

      
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    (f)           The
enumeration of the foregoing rights and remedies is not intended to be
exclusive, and such rights and remedies are in addition to and not by way of
limitation of any other rights or remedies Lender may have under the UCC or
other applicable law.  Lender shall have the right, in Lender's sole
and absolute discretion, to determine which rights and remedies, and in which
order any of the same, are to be exercised, and to determine which Collateral is
to be proceeded against and in which order, and the exercise of any right or
remedy shall not preclude the exercise of any others, all of which shall be
cumulative.

    

    (g)           No
act, failure or delay by Lender shall constitute a waiver of any of its rights
or remedies.  No single or partial waiver by Lender of any provision
of this Agreement or any supplement or amendment hereto, or breach or default
thereunder, or of any right or remedy which Lender may have shall operate as a
waiver of any other provision, breach, default, right or remedy or of the same
provision, breach, default, right or remedy on a future occasion.

    

    (h)           Borrower
waives presentment, notice of dishonor, protest and notice of protest of all
instruments included in or evidencing any of the Obligations or the Collateral
and any and all notices or demands whatsoever (except as expressly provided
herein).  Lender may, at all times, proceed directly against Borrower
or any guarantor or endorser to enforce payment of the Obligations and shall not
be required to take any action of any kind to preserve, collect or protect
Lender's or Borrower's rights in the Collateral.

     

    
      	
              SECTION 7. 

            	
                MISCELLANEOUS

            

    

    

    7.1.          Term.  This
Agreement shall become effective upon acceptance by Lender and shall continue in
full force and effect for a term ending on the last business day of the month,
one year from the date hereof (the "Renewal Date") and shall
automatically renew from year to year thereafter until terminated pursuant to
the terms hereof.  In addition to Lender's right to declare this
Agreement immediately terminated at any time upon the occurrence of an Event of
Default, Lender may terminate this Agreement on the Renewal Date or on the
anniversary of the Renewal Date in any year by giving Borrower at least thirty
(30) days prior written notice of such termination by registered or certified
mail, return receipt requested.  Borrower may terminate this Agreement
on the Renewal Date or on the anniversary of the Renewal Date in any year by
giving Lender at least ninety (90) days prior written notice of such termination
by registered or certified mail, return receipt requested.  No
termination of this Agreement, however, shall relieve or discharge Borrower of
Borrower's duties, obligations and covenants hereunder until all Obligations
have been paid in full and Lender's continuing security interest in and to the
Collateral shall remain in effect until all such Obligations have been fully
discharged.

    

    7.2.          Early Termination
Fee.  If Lender terminates this Agreement upon the occurrence
of an Event of Default or if Borrower terminates this Agreement as to future
transactions other than on the Renewal Date or any anniversary of the Renewal
Date, in view of the impracticality and extreme difficulty in ascertaining
Lender's actual damages and by mutual agreement of the parties as to a
reasonable calculation of Lender's lost profits as a result thereof, Borrower
hereby agrees that it shall immediately pay to Lender by wire transfer,
certified check or bank cashier's check, Borrower's entire Obligations owing
thereunder, plus liquidated damages of an amount equal to the total of the
Minimum Interest Charges for the number of months remaining until the Renewal
Date or the next anniversary thereof as provided for in this Agreement.
 Prior to its actual receipt of payment as aforesaid, Lender shall be free
to exercise, without limitation, all of its right under this Agreement or under
any other agreement it may then have with Borrower.  Borrower's
default of any provision under this Agreement may be considered and construed at
the sole option of Lender, as a termination of this Agreement by
Borrower.  The liquidated damages provided for in this Section shall
be deemed included in the Obligations and shall be presumed to be the amount of
damages sustained by Lender due to the Borrower's early termination and Borrower
agrees that such damages are reasonable and appropriate under the circumstances
currently existing.

    

    7.3.          One General Obligation;
Cross Collateral.  All Loans and advances by Lender to Borrower
under this Agreement, the other Loan Documents and under all other agreements,
present and future, between Lender and Borrower constitute one loan, and all
indebtedness and obligations of Borrower to Lender under this Agreement, the
other Loan Documents, and under all other agreements, present and future,
between Lender and Borrower, constitute one general obligation secured by the
Collateral and security held and to be held by Lender hereunder and by virtue of
all other agreements between Borrower (and all guarantors) and Lender now and
hereafter existing.  It is distinctly understood and agreed that all
of the rights of Lender contained in this Agreement shall likewise apply insofar
as applicable to any modification of or supplement to this Agreement, the other
Loan Documents and to any other agreements, present and future, between Lender
and Borrower.

     

    
      
        
        

      

      
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    7.4.          Binding on Successor and
Assigns; Severability.  All terms, conditions, promises,
covenants, provisions and warranties shall inure to the benefit of and bind
Lender’s and Borrower's respective representatives, successors and
assigns.  If any provision of this Agreement shall be prohibited or
invalid under applicable law, it shall be ineffective only to such extent,
without invalidating the remainder of this Agreement.

    

    7.5.          Amendments;
Assignments.  This Agreement may not be modified, altered or
amended, except by an agreement in writing signed by Borrower and Lender, which
requirement shall not be modified by oral agreement or by course of
conduct.  Borrower may not sell, assign or transfer any interest in
this Agreement or any other Loan Document, or any portion thereof, including,
without limitation, any of Borrower's rights, title, interests, remedies, powers
and duties hereunder or thereunder.  Borrower hereby consents to
Lender’s participation, sale, assignment, transfer or other disposition, at any
time or times hereafter, of this Agreement and any of the other Loan Documents,
or of any portion hereof or thereof, including, without limitation, Lender’s
rights, title, interests, remedies, powers and duties hereunder or
thereunder.  In connection therewith, Lender may disclose all
documents and information which Lender now or hereafter may have relating to
Borrower or Borrower's business.  To the extent that Lender assigns
its rights and obligations hereunder to a third party, Lender shall thereafter
be released from such assigned obligations to Borrower and such assignment shall
effect a novation between Borrower and such third party.

    

    7.6.          Integration;
Survival.  This Agreement, together with the Loan Schedule
(which is a part hereof) and the other Loan Documents, reflect the entire
understanding of the parties with respect to the transactions contemplated
hereby.  All of the representations and warranties of Borrower
contained in this Agreement shall survive the execution, delivery and acceptance
of this Agreement by the parties.  No termination of this Agreement
(or of any guaranty) of the Obligations shall affect or impair the powers,
obligations, duties, rights, representations, warranties or liabilities of the
parties hereto and all shall survive such termination.

    

    7.7.          Evidence of
Obligations.  Each Obligation may, in Lender’s discretion, be
evidenced by notes or other instruments issued or made by Borrower to
Lender.  If not so evidenced, such Obligation shall be evidenced
solely by entries upon Lender’s books and records.

    

    7.8.          Loan
Requests.  Each oral or written request for an advance by any
Person who purports to be any employee, officer or authorized agent of Borrower
shall be made to Lender on or prior to 11:00 a.m., NY time, on the business day
on which the proceeds thereof are requested to be paid to Borrower and shall be
conclusively presumed to be made by a Person authorized by Borrower to do so and
the crediting of a loan to Borrower's operating account shall conclusively
establish Borrower's obligation to repay such loan. Unless and until Borrower
otherwise directs Lender in writing, all loans shall be wired to Borrower's
operating account set forth on the Loan Schedule.

    

    7.9          Brokerage
Fees.  Borrower represents and warrants to Lender that, with
respect to the financing transaction herein contemplated, no Person is entitled
to any brokerage fee or other commission and Borrower agrees to indemnify and
hold Lender harmless against any and all such claims.

    

    7.10        Application of Insurance
Proceeds.  The net proceeds of any casualty insurance insuring
the Collateral, after deducting all costs and expenses (including attorneys’
fees) of collection, shall be applied, at Lender’s option, either toward
replacing or restoring the Collateral, in a manner and on terms satisfactory to
Lender, or toward payment of the Obligations.  Any proceeds applied to
the payment of Obligations shall be applied in such manner as Lender may
elect.  In no event shall such application relieve Borrower from
payment in full of all installments of principal and interest which thereafter
become due in the order of maturity thereof or with respect to the payment of
fees and costs.

     

    
      
        
        

      

      
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    7.11.        Disbursing
Agent.  The Borrowers hereby appoint ONE UP INNOVATIONS, INC. as
the “Disbursing Agent” to the Borrowers as it is in the best interest and
convenience of the Borrowers that all Loans and advances made by Lender pursuant
to this Agreement be made only to the Disbursing Agent rather than to each of
the Borrowers individually.  Accordingly, the Disbursing Agent shall
be the sole entity entitled to receive the funds advanced by Lender under this
Agreement and the Disbursing Agent shall make disbursements to the Borrowers as
reasonably requested by each Borrower to conduct its respective
business.  Moreover, the Disbursing Agent and each Borrower agrees and
authorizes Disbursing Agent and Lender to receive all collections and other
proceeds into the lockbox or other account assigned to and/or controlled by
Lender in accordance with Section 5.1 of this Agreement.  All of the
proceeds received into the lockbox will be credited by Lender to the Disbursing
Agent’s account and the Disbursing Agent shall have the sole authority to
further credit any such collections to each Borrower,
individually.  Each Borrower hereby irrevocably waives any claim it
may have against Lender and hereby indemnifies and holds Lender harmless from
and against all damages, losses, claims, demands, liabilities, obligations,
actions and causes of action whatsoever which such Borrower may have against
Lender which may arise as a result of advances being made by Lender solely to
the Disbursing Agent and/or collections being credited by Lender solely the
Disbursing Agent’s account with Lender.]

    

    7.12.       
Notices,
Correspondence.  All notices, requests, demands and other
communications under this Agreement shall be in writing and will be personally
served, telecopied or sent by overnight courier service or United States mail
and will be deemed to have been given: (i) if delivered in person, when
delivered; (ii) if delivered by telecopy, on the date of transmission if
transmitted on a business day before 4:00 p.m. New York time or, if not, on the
next succeeding business day; (iii) if delivered by overnight courier, the
following business day after depositing with such courier, properly addressed;
or (iv) if by U.S. Mail, four (4) business days after depositing in the United
States mail, with postage prepaid and properly addressed.  All
notices, requests and demands are to be given or made to the respective parties
at the addresses set forth herein or at such other addresses as either party may
designate in writing by notice in accordance with the provisions of this
paragraph.  All notices to Lender must be addressed to the attention
of:  Portfolio Manager.

    

    7.13.        Governing Law.  This
Agreement and all transactions hereunder are deemed to be consummated in the
State of New York and shall be governed by and interpreted in accordance with
the substantive and procedural laws of the State of New York (without regard to
any choice of law rules).  If any part or provision of this Agreement
shall be determined to be invalid or in contravention of any applicable law or
regulation of the controlling jurisdiction, such part or provision shall be
severed without affecting the validity of any other part or provision of this
Agreement.

    

    7.13.        JURY
WAIVER.  BORROWER AND LENDER EACH HEREBY WAIVE ALL RIGHTS TO A
TRIAL BY JURY IN ANY ACTION OR PROCEEDING OF ANY KIND ARISING OUT OF OR RELATING
TO THIS AGREEMENT, THE OTHER LOAN DOCUMENTS AND ANY SUPPLEMENT OR AMENDMENT
HERETO OR THERETO OR ANY OTHER TRANSACTION BETWEEN THE
PARTIES.  BORROWER HEREBY WAIVES ALL OF ITS RIGHTS OF SETOFF AND
RIGHTS TO INTERPOSE ANY DEFENSES AND/OR COUNTERCLAIMS IN THE EVENT OF ANY
LITIGATION WITH RESPECT TO ANY MATTER CONNECTED WITH THIS AGREEMENT, THE OTHER
LOAN DOCUMENTS AND ANY SUPPLEMENT OR AMENDMENT HERETO OR THERETO OR ANY OTHER
TRANSACTION BETWEEN THE PARTIES.  BORROWER HEREBY IRREVOCABLY CONSENTS
AND SUBMITS TO THE JURISDICTION AND VENUE OF THE SUPREME COURT OF THE STATE OF
NEW YORK (WITHOUT REGARD TO ANY CHOICE OF LAW RULES) OR THE UNITED STATES
DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK IN CONNECTION WITH ANY
ACTION OR PROCEEDING OF ANY KIND ARISING OUT OF OR RELATING TO THIS AGREEMENT,
THE OTHER LOAN DOCUMENTS AND ANY SUPPLEMENT OR AMENDMENT HERETO OR THERETO OR
ANY OTHER TRANSACTION BETWEEN THE PARTIES.  BORROWER AGREES THAT ANY
ACTION BROUGHT BY IT AGAINST LENDER WHETHER WITH REGARD TO THIS AGREEMENT OR
OTHERWISE SHALL BE SUBJECT TO THE EXCLUSIVE JURISDICTION AND VENUE OF THE
SUPREME COURT OF THE STATE OF NEW YORK (WITHOUT REGARD TO ANY CHOICE OF LAW
RULES), COUNTY OF NEW YORK OR THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN
DISTRICT OF NEW YORK.

    

    7.14.        Service.  In
any litigation brought by Lender, Borrower waives personal service of any
summons, complaint or other process and agrees that service thereof may be made
by certified or registered mail directed to Borrower at Borrower's address set
forth below and service so made shall be complete two (2) days after the same
shall have been posted.  Within twenty (20) days after such mailing,
Borrower shall appear and answer such summons, complaint or other process,
failing which Borrower shall be deemed in default and judgment may be entered by
Lender against Borrower for the amount of the claim and for any other relief
requested therein.

    

    7.15.        Lien
Termination.  In recognition of Lender’s right to have all of
its attorneys’ fees and other expenses incurred in connection with this
Agreement secured by the Collateral, notwithstanding the payment in full of the
Obligations, Lender shall not be required to execute or record any terminations
or satisfactions of any of its liens on the Collateral unless and until Borrower
(and all Guarantors) have executed and delivered to Lender general releases of
all claims, in form and substance satisfactory to Lender in Lender’s sole
discretion.

     

    
      
        
        

      

      
        Page 14
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    7.16          Publication.  Borrower
hereby consents to and authorizes Lender to issue appropriate press releases and
to cause a tombstone to be published announcing the consummation of this
transaction and the aggregate amount thereof.

    

    7.17.         Counterparts; Facsimile
Execution.  This Agreement may be executed in one or more
counterparts, each of which taken together shall constitute one and the same
instrument, admissible into evidence.

    

    
      
        
          
            
              
                
                  	
                          ONE
      UP INNOVATIONS, INC.

                        	 
	
                          Borrower

                        	 
	 
      	 
      	 
	
                          By:

                        	
                          /s/ Louis S. Friedman

                        	 
	
                          Name:

                        	
                          Louis
      S. Friedman

                        	 
	
                          Title:

                        	
                          President

                        	 
	 
      	 
      	 
	
                          FOAM
      LABS, INC.

                        	 
	
                          Borrower

                        	 
	 
      	 
      	 
	
                          By:

                        	
                          /s/ Louis S. Friedman

                        	 
	
                          Name:

                        	
                          Louis
      S. Friedman

                        	 
	
                          Title:

                        	
                          President

                        	 
	 
      	 
      	 
	
                          ACCEPTED:

                        	 
	 
      	 
	
                          ENTREPRENEUR
      GROWTH CAPITAL LLC

                        	 
	
                          Lender

                        	 
	 
      	 
      	 
	
                          By:

                        	
                          /s/ Dean Landis

                        	 
	 
      	
                          Dean
      Landis

                        	 
	 
      	
                          President

                        	 

                

              

            

          

        

      

    

    

    Notary
page follows

     

    
      
        
        

      

      
        Page 15
of 19

        
          

        

      

      
        
        

      

    

     

    LOAN
SCHEDULE

    

    
      	
              Borrower: 

            	
              ONE
      UP INNOVATIONS, INC.

            

    

    FOAM LABS, INC.

    2745 Bankers Industrial
Drive

    Atlanta,
GA  30360

     

    This Loan
Schedule forms an integral part of the Loan and Security Agreement (the “Loan
Agreement”) between the above Borrower and ENTREPRENEUR GROWTH CAPITAL, LLC
dated the above date, and all references herein and therein to “this Agreement”
shall be deemed to refer to said Agreement and this Loan Schedule.

    
       

      
        

      

    

    LINE
OF CREDIT:

    

    $250,000.00

    
       

      
        

      

    

    LOANS:

    

    Revolving
Credit Loans: Lender shall from time
to time, in its reasonable business discretion, make loans, advances and other
financial accommodations to or for the benefit of Borrower of up to 80% of the
Net Amount of Eligible Accounts (or such greater or lesser percentage thereof as
Lender shall, in its reasonable business discretion, determine), less any Loan
Reserves (the “Revolving Credit
Loans”).

    

    Borrower
may request Revolving Credit Loans from time to time but not more frequently
than twice a week unless Lender consents.  Revolving Credit Loans made
to Borrower more frequently than twice per week may be subject to additional
administrative surcharges and/or increased wire transfer fees.

    
      

        
          

        

      

    

    INTEREST
AND FEES:

    

    Revolving Interest
Rate.  Borrower shall pay Lender interest on the daily
outstanding balance of Borrower's Revolving Credit Loans at the per annum rate
equal to the highest prime rate in effect during each month as generally
reported by Citibank, N.A. (the "Prime Rate") plus 6% (the “Revolving Interest Rate”), but
the Revolving Interest Rate shall never be more than 24% per annum or the
maximum permitted by law.  The interest rate chargeable hereunder in
respect of the Revolving Credit Loans shall be increased or decreased, as the
case may be, without notice or demand of any kind, upon the announcement of any
change in the Prime Rate.  Interest charges and all other fees and
charges herein shall be calculated based on a three hundred sixty (360) day year
and actual number of days elapsed and shall be charged to Borrower on all
Obligations, in arrears, on the first day of each calendar month.  All
interest and fees charged or chargeable to Borrower shall be deemed as an
additional advance and shall become part of the Obligations.

    

    Overline and Overadvance
Interest.   In the event any amount to be advanced or
charged to the Borrower under this Agreement and the other Loan Documents
results in an Overline or Overadvance on any day in any month, Borrower will be
charged a one percent (1%) fee on the amount of any said Overline or
Overadvance, whether made with or without Lender’s knowledge or consent (the
“Overadvance
Fee”).  The Overadvance Fee, if applicable, would be charged on
the first day of the month, calculated on the highest amount of any Overadvance
that shall have occurred during the immediately preceding month.  The
fees charged on the amount of any Overline or Overadvance shall not be used in
calculating the Minimum Interest Charge.

     

    
      
        
        

      

      
        Page 16
of 19

        
          

        

      

      
        
        

      

    

     

    Default Rate of
Interest. Upon the occurrence and during the continuation of an Event of
Default, Borrower shall pay Lender interest on the daily outstanding balance of
the Obligations at a rate that is ten percentage points above the Revolving
Interest Rate (the “Default
Rate of Interest”), but the Default Rate of Interest shall never be more
than 24% per annum or the maximum permitted by law.

    

    Minimum Interest
Charge.  With respect to each calendar month or portion thereof
during the term of this Agreement (excluding the calendar month in which this
Agreement is executed for which a pro-rated share shall be charged, if
applicable), Borrower shall also pay Lender, on the first day of the next month,
as a minimum charge, the amount by which accrued interest pursuant to the
Revolving Interest Rate section above for such month or portion thereof is less
than $1,500.00 (the "Minimum
Interest Charge").  Notwithstanding the occurrence of any Event
of Default hereunder or termination of this Agreement by Lender as a result
thereof, the Minimum Interest Charge shall be paid by Borrower for the unexpired
portion of the initial term or any renewal term of this Agreement.

    

    Collateral Monitoring
Fee.  Borrower shall pay Lender a monthly collateral monitoring
fee (the “Collateral Monitoring
Fee”) in an amount equal to one quarter of one percent (0.25%) of the
Line of Credit.  The Collateral Monitoring Fee shall be charged to
Borrower's loan account, in arrears, on the first day of each
month.

    

    Facility
Fee.  Borrower shall pay Lender an annual fee (the “Facility Fee”) in an amount
equal to two (2%) percent of the Line of Credit.  The Facility Fee
shall be deemed fully earned on the date such payment is due and is payable upon
the execution and delivery of this Agreement and upon each annual anniversary
date of this Agreement until such time as this Agreement has been terminated in
accordance with its terms.  In the event the Line of Credit is
increased after Borrower paid the annual Facility Fee but prior to any annual
anniversary date of this Agreement, the Facility Fee shall also be paid on such
increase in the Line of Credit.  If applicable, the initial Facility
Fee payment shall include the pro-rata amount for the final, partial month of
the first contract year, calculated by multiplying the Facility Fee percent by
the Line of Credit, dividing by 360 and multiplied by the number of days from
the date that is one year from the date of this Agreement to the last day of the
month that is one year from the date of this Agreement..

    

    Examination
Fee.  Borrower agrees to pay to Lender an examination fee in
the amount of $1,000.00
per person per day in connection with each audit or field examination of
Borrower performed by Lender prior to or after the date hereof (including the
initial examination), plus all costs and expenses incurred in connection
therewith (the “Examination
Fee”), all of which shall be deemed part of the
Obligations.  Without limiting Lender’s rights hereunder and under the
Loan Agreement, Lender agrees, provided no Event of Default shall have occurred,
to limit ordinary course field examinations to no more than two (2) per contract
year.

    

    Documentation
Fee.  Borrower shall pay Lender, on the Closing Date, a
documentation fee (“the “Documentation Fee”) as shall
be reasonably determined by Lender based upon the time expended in conducting
due diligence, reviewing documents and negotiating and preparing this Agreement
and the ancillary documents, in addition to all out of pocket expenses related
to the initial audit and field examination and public records searches and
filings.  The documentation fee and all other Costs and Expenses
related to the closing of this Agreement shall deducted from any deposits
remitted by Borrower to Lender, then, to the extent required, be charged to
Borrower’s loan account as provided in Section 2.8. Without Limiting Lender’s rights
hereunder and under the
Loan Agreement, Lender
agrees that the Costs and Expenses related
to the initial closing only, shall not exceed
$5,000.00.

     

    
      
        
        

      

      
        Page 17
of 19

        
          

        

      

      
        
        

      

    

     

    Wire Transfer and
Miscellaneous Fees.  Borrower shall pay Lender service fees for
(a) electronic transfers of money in the amount of $50.00 per federal wire
transfer and $10.00 per automated clearinghouse (“ACH”) transfer; (b) $10.00 for
each advance in the form of a check deposited into Borrower's bank account by
Lender; (c) $5.00 for each internal transfer made by Lender; (d) for
disbursements made to third parties, an amount equal to the greater of 15% of
the amount of each check issued to third parties or $50.00, (e) service fees of
$50.00 each shall be made for processing bank returned items, each issuance of a
check or wire transfer in excess of two per week, each request for a money
transfer prior to 11am, and advances of less than $5,000.00, and (f) Borrower
shall pay Lender for all postage and telephone charges, as well as cents for all
copies made by Lender for or on behalf of Borrower.

    
      

      CLOSING
CONDITIONS: 

        
          

        

      

    

    

    (1)         Fees.  Borrower
shall have paid all fees payable by it on the Closing Date pursuant to this
Agreement, including but not limited to, Lender’s legal and documentation
fees.

    

    (2)         No Material Adverse
Changes.  Prior to the Closing Date, there shall have occurred
no material adverse change in the financial condition of Borrower, or in the
condition of the assets of Borrower, from that shown on the most recent
financial statements for Borrower delivered to Lender.  At the
closing, Borrower shall deliver to Lender an officer’s certification confirming
that Borrower is unaware of the existence of any such material adverse change in
Borrower’s financial condition.

    

    (3)         Material
Agreements.  Lender shall have received, reviewed and approved
all material agreements to which Borrower shall be a party.

    

    (4)         Other
Matters.  All other documents and legal matters in connection
with the transactions contemplated by this Agreement shall have been delivered,
executed and recorded and shall be in form and substance satisfactory to Lender
and its counsel.

    
       

      
        

      

    

    BORROWER
INFORMATION:

    

    
      Borrower’s
State of [Incorporation]
or [Formation]:    
Georgia

    

    

    Borrower's
copyrights, patents trademarks, and licenses:  [Borrower to Supply on
Separate Exhibit].

    

    
      Fictitious
Names/Prior Corporate Names:

    

    

    
      Prior
Corporate Names:   None

    

    

    
      Fictitious
Names:            
None

    

    

    
      Borrower
Locations:

    

    

    
      	
               
      

            	
              ______________________________________________

            

    

    
      	
               
      

            	
              ______________________________________________

            

    

    

    
      	
               
      

            	
              Borrower’s
      Federal Tax Identification
      Number:  _____________________

            

    

     

    
      
        
        

      

      
        Page 18
of 19

        
          

        

      

      
        
        

      

    

     

    
      

    

    DISBURSEMENT:

    

    Unless
and until Borrower otherwise directs Lender in writing, all loans shall be wired
to Borrower's following operating account:

    

    
      
        
          
            
              
                	  	
                        Name and address of bank: 

                      	
                        Fidelity
      Bank

                      
	 	 	_____________________________ 
	 	 	_____________________________
	 	
                        Routing/ABA
      No.:

                      	061102400
	 	
                        Account
      No:

                      	016000XXXX
	 	
                        Account
      Name:

                      	One
      Up Innovations,
Inc.

              

            

          

        

      

    

    
       

      
        

      

       

    

    
      
        
          
            	
                    ONE
      UP INNOVATIONS, INC.

                  	 
      	
                    ENTREPRENEUR
      GROWTH

                  
	 
      	 
      	 
      	
                    CAPITAL,
      LLC

                  
	 
      	 
      	 
      	 
      	 
      
	
                    By:

                  	
                    /s/ Louis S. Friedman

                  	 
      	
                    By:

                  	
                    /s/ Dean Landis

                  
	
                    Name:

                  	
                    Louis
      S. Friedman

                  	 
      	
                    Name:

                  	
                    Dean
      Landis

                  
	
                    Title:

                  	
                    President

                  	 
      	
                    Title:

                  	
                    President

                  
	 
      	 
      	 
      	 
      	 
      
	
                    FOAM
      LABS, INC.

                  	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      
	
                    By:

                  	
                    /s/ Louis S. Friedman

                  	 
      	 
      	 
      
	
                    Name:

                  	
                    Louis
      S. Friedman

                  	 
      	 
      	 
      
	
                    Title:

                  	
                    President

                  	 
      	 
      	 
      

          

        

      

    

     

    
      
        
        

      

      
        Page 19
of 19

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