Document:

REGISTRATION
      RIGHTS AGREEMENT

     

    This
      REGISTRATION RIGHTS AGREEMENT
      (this
“Agreement”),
      dated
      as of April 26, 2007, by and among PokerTek, Inc., a North Carolina corporation
      with headquarters located at 1020 Crews Road, Suite J, Matthews, North Carolina
      28106 (the ”Company”),
      and
      the undersigned buyers (each, a “Buyer”,
      and
      collectively, the “Buyers”).

     

    RECITALS

     

    A.    In
      connection with the Securities Purchase Agreement by and among the parties
      hereto, dated as of April 23, 2007 (the “Securities
      Purchase Agreement”),
      the
      Company has agreed, upon the terms and subject to the conditions set forth
      in
      the Securities Purchase Agreement, to issue and sell to each Buyer (i) shares
      (the “Common
      Shares”)
      of the
      Company’s common stock, no par value (the “Common
      Stock”),
      and
      (ii) the Warrants (as defined in the Securities Purchase Agreement) which will
      be exercisable to purchase Warrant Shares (as defined in the Securities Purchase
      Agreement) in accordance with the terms of the Warrants.

     

    B.    To
      induce
      the Buyers to execute and deliver the Securities Purchase Agreement, the Company
      has agreed to provide certain registration rights under the Securities Act
      of
      1933, as amended, and the rules and regulations thereunder, or any similar
      successor statute (collectively, the “1933
      Act”),
      and
      applicable state securities laws.

     

    AGREEMENT

     

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

     

    
      	
              1.

            	
              Definitions.

            

    

     

    Capitalized
      terms used herein and not otherwise defined herein shall have the respective
      meanings set forth in the Securities Purchase Agreement. As used in this
      Agreement, the following terms shall have the following meanings:

     

    (a) “Business
      Day”
means
      any day other than Saturday, Sunday or any other day on which commercial banks
      in The City of New York are authorized or required by law to remain
      closed.

     

    (b) “Closing
      Date”
shall
      have the meaning set forth in the Securities Purchase Agreement.

     

    (c) “Effective
      Date”
means
      the date that the applicable Registration Statement has been declared effective
      by the SEC.

     

    (d) “Effectiveness
      Deadline”
means
      (i) with respect to the initial Registration Statement required to be filed
      to
      cover the resale by the Investors of the Registrable Securities

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    the
      105th
      calendar
      day after the Closing Date (or the 135th
      calendar
      day after the Closing Date in the event that such Registration Statement is
      subject to review by the SEC) and (b) with respect to any additional
      Registration Statements that may be required to be filed by the Company pursuant
      to this Agreement, the 105th
      calendar
      day following the date on which the Company was required to file such additional
      Registration Statement (or the 135th
      calendar
      day after such date in the event that such Registration Statement is subject
      to
      review by the SEC).

     

    (e) “Filing
      Deadline”
means
      the date which is 45 Business Days after the Closing Date.

     

    (f) “Investor”
means
      a
      Buyer or any transferee or assignee
      of
      any Registrable Securities or Warrants, as applicable, to whom a Buyer assigns
      its rights under this Agreement and who agrees to become bound by the provisions
      of this Agreement in accordance with Section 0
      and any
      transferee or assignee thereof to whom a transferee or assignee of any
      Registrable Securities or Warrants, as applicable, assigns its rights under
      this
      Agreement and who agrees to become bound by the provisions of this Agreement
      in
      accordance with Section 0.

     

    (g) “Person”
means
      an individual, a limited liability company, a partnership, a joint venture,
      a
      corporation, a trust, an unincorporated organization and a government or any
      department or agency thereof.

     

    (h) “register,”
      “registered,”
and
      “registration”
refer
      to a registration effected by preparing and filing one or more Registration
      Statements (as defined below) in compliance with the 1933 Act and pursuant
      to
      Rule 415 and the declaration of effectiveness of such Registration Statement(s)
      by the SEC.

     

    (i) “Registrable
      Securities”
means
      (i) the Common Shares, (ii) the Warrant Shares issued or issuable upon
      exercise of the Warrants and (iii) any capital stock of the Company issued
      or
      issuable with respect to the Common Shares, the Warrant Shares or the Warrants,
      including, without limitation, as a result of any share split, share dividend,
      recapitalization, exchange or similar event or otherwise, without regard to
      any
      limitations on exercise of the Warrants, until,
      in each
      case, the earliest to occur of (i) the date on which such Common Share, Warrant
      Share or such share capital of the Company has been registered under the 1933
      Act and sold or transferred pursuant to an effective Registration Statement,
      (ii) the date on which such Common Share or Warrant Share has been sold pursuant
      to Rule 144 under the 1933 Act or are eligible for sale (without volume
      restrictions) pursuant to Rule 144(k) under the 1933 Act or (iii) the date
      on
      which such Common Share,
      Warrant Share or such share capital ceases to be outstanding.

     

    (j) “Registration
      Statement”
means
      a
      registration statement or registration statements of the Company filed under
      the
      1933 Act covering the Registrable Securities.

     

    (k) “Required
      Holders”
means
      the holders of at least a majority of the Registrable Securities.

     

    (l) “Required
      Registration Amount”
means
      the sum of (i) the number of Common Shares issued and (ii) the number of Warrant
      Shares issued and issuable pursuant to the Warrants as of the Trading Day
      immediately preceding the applicable date of determination
      (without

    
      
        
        

      

      
        -2-

        
          

        

      

      
        
        

      

    

    taking
      into account any limitations on the exercise of the Warrants set forth therein),
      all subject to adjustment as provided in Section 2(d).

     

    (m) “Rule
      415”
means
      Rule 415 under the 1933 Act or any successor rule providing for offering
      securities on a continuous or delayed basis.

     

    (n) “SEC”
means
      the United States Securities and Exchange Commission.

     

    
      	
              2.

            	
              Registration.

            

    

     

    (a) Mandatory
      Registration.
      The
      Company shall prepare, and, as soon as reasonably practicable, but in no event
      later than the Filing Deadline, file with the SEC the Registration Statement
      on
      Form S-1 covering the resale of all of the Registrable Securities. In the event
      that Form S-1 is unavailable for such a registration, the Company shall use
      such
      other form as is available for such a registration on another appropriate form
      reasonably acceptable to the Required Holders, subject to the provisions of
      Section 0(c).
      The
      Registration Statement prepared pursuant hereto shall register for resale at
      least the number of shares of Common Stock equal to the Required Registration
      Amount as of the date the Registration Statement is initially filed with the
      SEC. The Registration Statement shall contain (except if otherwise directed
      by
      the Required Holders) the “Selling
      Stockholders”
and
      “Plan
      of Distribution”
      sections in substantially the form attached hereto as Exhibit
      B,
      unless
      otherwise required by the SEC. The Company shall use its best efforts to have
      the Registration Statement declared effective by the SEC as soon as practicable,
      but in no event later than the Effectiveness Deadline. The Company shall use
      its
      best efforts to file with the SEC in accordance with Rule 424 under the 1933
      Act
      the final prospectus to be used in connection with sales pursuant to such
      Registration Statement by 9:30 a.m. on the Business Day following the Effective
      Date.
      In no
      event shall the Company include any securities other than Registrable Securities
      on any Registration Statement without the prior written consent of the Required
      Holders. The Company shall not after the date hereof until the Effective Date
      of
      the Registration Statement required to be filed pursuant to this Section
00
      enter
      into any agreement providing any such right to any of its security
      holders.

     

    (b) Legal
      Counsel.
      Subject
      to Section 0
      hereof,
      Magnetar Capital Master Fund, Ltd. shall have the right to select one (1) legal
      counsel to review and oversee, solely on its behalf, any registration pursuant
      to this Section 0
      (“Legal
      Counsel”),
      which
      shall be Greenberg Traurig, LLP or such other counsel as thereafter designated
      by Magnetar Capital Master Fund, Ltd. 

     

    (c) Ineligibility
      for Form S-1.
      In the
      event that Form S-1 is not available for the registration of the resale of
      Registrable Securities hereunder, the Company shall register the resale of
      the
      Registrable Securities on another appropriate form reasonably acceptable to
      the
      Required Holders.

     

    (d) Sufficient
      Number of Shares Registered.
      In the
      event the number of shares available under a Registration Statement filed
      pursuant to Section 00
      is
      insufficient to cover all of the Registrable Securities required to be covered
      by such Registration Statement, the Company shall amend the applicable
      Registration Statement, or file a new Registration Statement (on the short
      form
      available therefor, if applicable), or both, so as to cover at least the
      Required Registration Amount as of the Trading Day immediately preceding the
      date of the

    
      
        
        

      

      
        -3-

        
          

        

      

      
        
        

      

    

    filing
      of
      such amendment or new Registration Statement, in each case, as soon as
      practicable, but in any event not later than fifteen (15) days after the
      necessity therefor arises. The Company shall use its best efforts to cause
      such
      amendment and/or new Registration Statement to become effective as soon as
      practicable following the filing thereof. For purposes of the foregoing
      provision, the number of shares available under a Registration Statement shall
      be deemed “insufficient to cover all of the Registrable Securities” if at any
      time the number of shares of Common Stock registered under such Registration
      Statement is less than the product determined by multiplying (i) the Required
      Registration Amount as of such time by (ii) 0.90. The calculation set forth
      in
      the foregoing sentence shall be made without regard to any limitations on the
      exercise of the Warrants and that the Warrants are then fully exercisable for
      shares of Common Stock at the then prevailing applicable Exercise
      Price.

     

    (e) Effect
      of Failure to File and Obtain and Maintain Effectiveness of Registration
      Statement.
      If (i)
      a Registration Statement covering all of the Registrable Securities required
      to
      be covered thereby and required to be filed by the Company pursuant to this
      Agreement is (A) not filed with the SEC on or before the Filing Deadline (a
      “Filing
      Failure”)
      or (B)
      not declared effective by the SEC on or before the Effectiveness Deadline (an
      “Effectiveness
      Failure”)
      or
      (ii) on any day after the Effective Date of such Registration Statement sales
      of
      all of the Registrable Securities required to be included on such Registration
      Statement cannot be made (other than during an Allowable Grace Period (as
      defined in Section 0)
      pursuant to such Registration Statement (including, without limitation, because
      of a failure to keep such Registration Statement effective, to disclose such
      information as is necessary for sales to be made pursuant to such Registration
      Statement, a suspension or delisting of (or a failure to timely list) the Common
      Stock on its principal trading market or exchange, or to register a sufficient
      number of shares of Common Stock) (a “Maintenance
      Failure”)
      then,
      as relief for the damages to any holder by reason of any such delay in or
      reduction of its ability to sell the underlying shares of Common Stock (which
      remedy shall be exclusive of any other monetary remedies available, excluding
      remedies of specific performance), the Company shall pay to each holder of
      Registrable Securities relating to such Registration Statement, as liquidated
      damages, an amount in cash equal to two percent (2%) of the aggregate Purchase
      Price (as such term is defined in the Securities Purchase Agreement) of such
      Investor’s Registrable Securities included in such Registration Statement that
      continue to be owned by such Investor and which are not registered (or the
      prospectus contained in the applicable Registration Statement is not available
      for use) as a result of the Filing Failure, Effectiveness Failure or Maintenance
      Failure, on every thirty (30) day anniversary (pro rated for periods totaling
      less than thirty days) of (1) a Filing Failure until such Filing Failure is
      cured; (2) an Effectiveness Failure until such Effectiveness Failure is cured;
      and (3) a Maintenance Failure until such Maintenance Failure is cured. The
      payments to which a holder shall be entitled pursuant to this Section
00
      are
      referred to herein as “Registration
      Delay Payments.”
      Notwithstanding the foregoing, in no event shall (I) the aggregate of all
      Registration Delay Payments exceed $1,000,000 or (II) the Company be required
      to
      pay any Registration Delay Payments to an Investor with respect to an
      Effectiveness Failure or a Maintenance Failure if all the Registrable Securities
      included in the Registration Statement that is the subject to such Effectiveness
      Failure or Maintenance Failure (as the case may be) and then held by such
      Investor are eligible to be sold pursuant to Rule 144(k) promulgated under
      the
      1933 Act on the Principal Market. Registration Delay Payments shall be paid
      on
      the earlier of (A) the last day of each thirty (30) day period following the
      event or failure giving rise to the Registration Delay Payments and (B) the
      third (3rd)
      Business Day after such event or failure is

    
      
        
        

      

      
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    cured.
      In
      the event the Company fails to make Registration Delay Payments in a timely
      manner, such Registration Delay Payments shall bear interest at the rate of
      one
      percent (1.0%) per month (pro rated for partial months) until paid in
      full.

     

    (f) Offering.
      Notwithstanding anything to the contrary contained in this Agreement, in the
      event the staff of the SEC (the “Staff”)
      or the
      SEC seeks to characterize any offering pursuant to a Registration Statement
      filed pursuant to this Agreement as constituting an offering of securities
      by or on behalf of the Company, or in any other manner, such that the Staff
      or the SEC do not permit such Registration Statement to become
      effective and used for resales in a manner that does not constitute such an
      offering and that permits the continuous resale at the market by the Investors
      participating therein (or as otherwise may be acceptable to each
      Investor) without being named therein as an “underwriter,” then the Company
      shall reduce the number of shares to be included in such Registration Statement
      by all Investors until such time as the Staff and the SEC shall so permit
      such Registration Statement to become effective as aforesaid.  In making
      such reduction, the Company shall reduce the number of shares to be included
      by
      all Investors on a pro rata basis (based upon the number of Registrable
      Securities otherwise required to be included for each Investor) unless the
      inclusion of shares by a particular Investor or a particular set of Investors
      are resulting in the Staff or the SEC’s “by or on behalf of the Company”
offering position, in which event the shares held by such Investor or set of
      Investors shall be the only shares subject to reduction (and if by a set of
      Investors on a pro rata basis by such Investors or on such other basis as would
      result in the exclusion of the least number of shares by all such
      Investors). In addition, in the event that the Staff or the SEC requires
      any Investor seeking to sell securities under a Registration Statement
      filed pursuant to this Agreement to be specifically identified as
      an “underwriter” in order to permit such Registration Statement to
      become effective, and such Investor does not consent to being so named as an
      underwriter in such Registration Statement, then, in each such case, the
      Company shall reduce the total number of Registrable Securities to be
      registered on behalf of such Investor, until such time as the
      Staff or the SEC does not require such identification or until such Investor
      accepts such identification and the manner thereof. Any reduction pursuant
      to this paragraph will first reduce all Registrable Securities other than
      those issued pursuant to the Securities Purchase Agreement. In the event of
      any reduction in Registrable Securities pursuant to this paragraph, an
      affected Investor shall have the right to require, upon delivery of a written
      request to the Company signed by such Investor, the Company to file a
      registration statement within 30 days of such request (subject to any
      restrictions imposed by Rule 415 or required by the Staff or the SEC)
      for resale by such Investor in a manner acceptable to such Investor, and the
      Company shall following such request cause to be and keep effective such
      registration statement in the same manner as otherwise contemplated in this
      Agreement for registration statements hereunder, in each case until such
      time as: (i) all Registrable Securities held by such Investor have been
      registered pursuant to an effective Registration Statement in a manner
      acceptable to such Investor or (ii) the Registrable Securities may be
      resold by such Investor without restriction (including volume limitations)
      pursuant to Rule 144(k) of the 1933 Act (taking account of any Staff position
      with respect to “affiliate” status) or (iii) such Investor agrees to be named as
      an underwriter in any such Registration Statement in a manner acceptable to
      such
      Investor as to all Registrable Securities held by such Investor and that have
      not theretofore been included in a Registration Statement under this Agreement
      (it being understood that the special demand right under this sentence may
      be
      exercised by an Investor multiple times and with respect to
      limited

    
      
        
        

      

      
        -5-

        
          

        

      

      
        
        

      

    

    amounts
      of Registrable Securities in order to permit the resale thereof by such Investor
      as contemplated above).

     

    
      	
              3.

            	
              Related
                Obligations.

            

    

     

    The
      Company will use its best efforts to effect the registration of the Registrable
      Securities in accordance with the intended method of disposition thereof and,
      pursuant thereto, the Company shall have the following obligations:

     

    (a) The
      Company shall promptly prepare and file with the SEC a Registration Statement
      with respect to the Registrable Securities (but in no event later than the
      Filing Deadline) and use its best efforts to cause such Registration Statement
      relating to the Registrable Securities to become effective as soon as
      practicable after such filing (but in no event later than the Effectiveness
      Deadline). Subject to allowable Grace Periods (as defined below), the Company
      shall use best efforts to keep each Registration Statement effective pursuant
      to
      Rule 415 at all times until the earlier of (i) the date as of which all of
      the
      Investors may sell all of the Registrable Securities required to be covered
      by
      such Registration Statement without restriction pursuant to Rule 144(k) (or
      any
      successor thereto) promulgated under the 1933 Act or (ii) the date on which
      the
      Investors shall have sold all of the Registrable Securities covered by such
      Registration Statement or (iii) the date that is two years after the Effective
      Date (the “Registration
      Period”).
      The
      Company shall ensure that each Registration Statement (including any amendments
      or supplements thereto and prospectuses contained therein) shall not contain
      any
      untrue statement of a material fact or omit to state a material fact required
      to
      be stated therein, or necessary to make the statements therein (in the case
      of
      prospectuses, in the light of the circumstances in which they were made) not
      misleading. The Company shall submit to the SEC, within three (3) Business
      Days
      after the later of the date that (i) the Company learns that no review of a
      particular Registration Statement will be made by the staff of the SEC or that
      the staff has no further comments on a particular Registration Statement (as
      the
      case may be) and (ii) the approval of Legal Counsel pursuant to Section
00
      (which
      approval is immediately sought), a request for acceleration of effectiveness
      of
      such Registration Statement to a time and date not later than 48 hours after
      the
      submission of such request. 

     

    (b) Subject
      to Section 00
      of this
      Agreement, the Company shall prepare and file with the SEC such amendments
      (including post-effective amendments) and supplements to a Registration
      Statement and the prospectus used in connection with such Registration
      Statement, which prospectus is to be filed pursuant to Rule 424 promulgated
      under the 1933 Act, as may be necessary to keep such Registration Statement
      effective at all times during the Registration Period, and, during such period,
      comply with the provisions of the 1933 Act with respect to the disposition
      of
      all Registrable Securities of the Company required to be covered by such
      Registration Statement until such time as all of such Registrable Securities
      shall have been disposed of in accordance with the intended methods of
      disposition by the seller or sellers thereof as set forth in such Registration
      Statement. In the case of amendments and supplements to a Registration Statement
      which are required to be filed pursuant to this Agreement (including pursuant
      to
      this Section 00)
      by
      reason of the Company filing a report on Form 10-Q (or Form 10Q-SB) or Form
      10-K
      (or Form 10-KSB) or any analogous report under the Securities Exchange Act
      of
      1934, as amended (the “1934
      Act”),
      the
      Company shall have incorporated such report by reference into such Registration
      Statement, if applicable, or shall file such amendments

    
      
        
        

      

      
        -6-

        
          

        

      

      
        
        

      

    

    or
      supplements with the SEC on the same day on which the 1934 Act report is filed
      which created the requirement for the Company to amend or supplement such
      Registration Statement.

     

    (c) The
      Company shall (A) permit Legal Counsel to review and comment upon (i) a
      Registration Statement at least three (3) Business Days prior to its filing
      with
      the SEC and (ii) all amendments and supplements to all Registration Statements
      (except for documents filed pursuant to the 1934 Act incorporated by references,
      Annual Reports on Form 10-K (or Form 10-KSB), Quarterly Reports on Form 10-Q
      (or
      Form 10-QSB), Current Reports on Form 8-K, and any similar or successor reports)
      within a reasonable number of days prior to their filing with the SEC, and
      (B)
      not file any Registration Statement or amendment or supplement thereto in a
      form
      to which Legal Counsel or any legal counsel for any other Investor reasonably
      objects. The Company shall not submit a request for acceleration of the
      effectiveness of a Registration Statement or any amendment or supplement thereto
      without the prior approval of Legal Counsel, which consent shall not be
      unreasonably withheld. The Company shall furnish to Legal Counsel, without
      charge, (i) copies of any correspondence from the SEC or the staff of the SEC
      to
      the Company or its representatives relating to any Registration Statement,
      provided that such correspondence shall not contain any material, non-public
      information regarding the Company or any of its subsidiaries, (ii) upon
      request, promptly after the same is prepared and filed with the SEC, one (1)
      copy of any Registration Statement and any amendment(s) thereto, including
      financial statements and schedules, all documents incorporated therein by
      reference, if requested by an Investor, and all exhibits and (iii) upon
      request, upon the effectiveness of any Registration Statement, one (1) copy
      of
      the prospectus included in such Registration Statement and all amendments and
      supplements thereto. The Company shall reasonably cooperate with Legal Counsel
      and legal counsel for each other Investor in performing the Company’s
      obligations pursuant to this Section 0.

     

    (d) The
      Company shall furnish to each Investor whose Registrable Securities are included
      in any Registration Statement, without charge, (i) promptly after the same
      is
      prepared and filed with the SEC, at least one (1) copy of any Registration
      Statement and any amendment(s) thereto, including financial statements and
      schedules, all documents incorporated therein by reference, if requested by
      an
      Investor, all exhibits and each preliminary prospectus, (ii) upon the
      effectiveness of any Registration Statement, ten (10) copies of the prospectus
      included in such Registration Statement and all amendments and supplements
      thereto (or such other number of copies as such Investor may reasonably request
      from time to time) and (iii) such other documents, including copies of any
      preliminary or final prospectus, as such Investor may reasonably request from
      time to time in order to facilitate the disposition of the Registrable
      Securities owned by such Investor.

     

    (e) The
      Company shall use its best efforts to (i) register and qualify, unless an
      exemption from registration and qualification applies, the resale by Investors
      of the Registrable Securities covered by a Registration Statement under such
      other securities or “blue sky” laws of all applicable jurisdictions in the
      United States, (ii) prepare and file in those jurisdictions, such amendments
      (including post-effective amendments) and supplements to such registrations
      and
      qualifications as may be necessary to maintain the effectiveness thereof during
      the Registration Period, (iii) take such other actions as may be necessary
      to
      maintain such registrations and qualifications in effect at all times during
      the
      Registration Period, and (iv) take all other actions

    
      
        
        

      

      
        -7-

        
          

        

      

      
        
        

      

    

    reasonably
      necessary or advisable to qualify the Registrable Securities for sale in such
      jurisdictions; provided,
      however,
      that
      the Company shall not be required in connection therewith or as a condition
      thereto to (x) qualify to do business in any jurisdiction where it would not
      otherwise be required to qualify but for this Section 00,
      (y)
      subject itself to general taxation in any such jurisdiction, or (z) file a
      general consent to service of process in any such jurisdiction. The Company
      shall promptly notify Legal Counsel and each Investor who holds Registrable
      Securities of the receipt by the Company of any notification with respect to
      the
      suspension of the registration or qualification of any of the Registrable
      Securities for sale under the securities or “blue sky” laws of any jurisdiction
      in the United States or its receipt of actual notice of the initiation or
      threatening of any proceeding for such purpose.

     

    (f) The
      Company shall notify Legal Counsel and each Investor in writing of the happening
      of any event, as promptly as practicable after becoming aware of such event,
      as
      a result of which the prospectus included in a Registration Statement, as then
      in effect, includes an untrue statement of a material fact or omission to state
      a material fact required to be stated therein or necessary to make the
      statements therein, in the light of the circumstances under which they were
      made, not misleading (provided
      that in
      no event shall such notice contain any material, non-public information
      regarding the Company or any of its subsidiaries), and, subject to Section
      00,
      promptly prepare a supplement or amendment to such Registration Statement to
      correct such untrue statement or omission and deliver ten (10) copies of such
      supplement or amendment to Legal Counsel, legal counsel for each other Investor
      and each Investor (or such other number of copies as Legal Counsel, legal
      counsel for each other Investor or such Investor may reasonably request). The
      Company shall also promptly notify Legal Counsel and each Investor in writing
      (i) when a prospectus or any prospectus supplement or post-effective amendment
      has been filed, when a Registration Statement or any post-effective amendment
      has become effective (notification of such effectiveness shall be delivered
      to
      Legal Counsel and each Investor by facsimile or e-mail on the same day of such
      effectiveness and by overnight mail), and when the Company receives written
      notice from the SEC that a Registration Statement or any post-effective
      amendment will be reviewed by the SEC, (ii) of any request by the SEC for
      amendments or supplements to a Registration Statement or related prospectus
      or
      related information, and (iii) of the Company’s reasonable determination that a
      post-effective amendment to a Registration Statement would be
      appropriate.

     

    (g) The
      Company shall use its best efforts to prevent the issuance of any stop order
      or
      other suspension of effectiveness of a Registration Statement, or the suspension
      of the qualification of any of the Registrable Securities for sale in any
      jurisdiction and, if such an order or suspension is issued, to use best efforts
      promptly to obtain the withdrawal of such order or suspension at the earliest
      possible moment and to notify Legal Counsel and each Investor who holds
      Registrable Securities being sold of the issuance of such order and the
      resolution thereof or its receipt of actual notice of the initiation or threat
      of any proceeding for such purpose.

     

    (h) If
      any
      Investor may be required under applicable securities law to be described in
      the
      Registration Statement as an underwriter and such Investor consents to so being
      named an underwriter, at the request of any Investor, the Company shall furnish
      to such Investor, on the date of the effectiveness of the Registration Statement
      and thereafter from time to time on such dates as an Investor may reasonably
      request (i) a letter, dated such date, from the Company’s independent certified
      public accountants in form and substance as is customarily given
      by

    
      
        
        

      

      
        -8-

        
          

        

      

      
        
        

      

    

    independent
      certified public accountants to underwriters in an underwritten public offering,
      addressed to the Investors, and (ii) an opinion, dated as of such date, of
      counsel representing the Company for purposes of such Registration Statement,
      in
      form, scope and substance as is customarily given to selling securityholders
      in
      such transactions, addressed to the Investors.

     

    (i) If
      any
      Investor may be required under applicable securities law to be described in
      the
      Registration Statement as an underwriter and such Investor consents to so being
      named an underwriter, upon the written request of such Investor, the Company
      shall make available for inspection by (i) such Investor, (ii) legal counsel
      for
      such an Investor and (iii) one (1) firm of accountants or other agents retained
      by such Investor (collectively, the “Inspectors”),
      all
      pertinent financial and other records, and pertinent corporate documents and
      properties of the Company (collectively, the “Records”),
      as
      shall be reasonably deemed necessary by each Inspector, and cause the Company’s
      officers, directors and employees to supply all information which any Inspector
      may reasonably request; provided, however, that each Inspector shall agree
      in
      writing to hold in strict confidence and not to make any disclosure (except
      to
      such Investor) or use of any Record or other information which the Company’s
      Board of Directors determines in good faith to be confidential, and of which
      determination the Inspectors are so notified, unless (a) the disclosure of
      such
      Records is necessary to avoid or correct a misstatement or omission in any
      Registration Statement or is otherwise required under the 1933 Act, (b) the
      release of such Records is ordered pursuant to a final, non-appealable subpoena
      or order from a court or government body of competent jurisdiction, or (c)
      the
      information in such Records has been made generally available to the public
      other than by disclosure in violation of this Agreement or any other Transaction
      Document. Such Investor agrees that it shall, upon learning that disclosure
      of
      such Records is sought in or by a court or governmental body of competent
      jurisdiction or through other means, give prompt notice to the Company and
      allow
      the Company, at its expense, to undertake appropriate action to prevent
      disclosure of, or to obtain a protective order for, the Records deemed
      confidential. Nothing herein (or in any other confidentiality agreement between
      the Company and such Investor, if any) shall be deemed to limit any Investor’s
      ability to sell Registrable Securities in a manner which is otherwise consistent
      with applicable laws and regulations.

     

    (j) The
      Company shall hold in confidence and not make any disclosure of information
      concerning an Investor provided to the Company unless (i) disclosure of such
      information is necessary to comply with federal or state securities laws, (ii)
      the disclosure of such information is necessary to avoid or correct a
      misstatement or omission in any Registration Statement or is otherwise required
      to be disclosed in the Registration Statement pursuant to the 1933 Act, (iii)
      the release of such information is ordered pursuant to a subpoena or other
      final, non-appealable order from a court or governmental body of competent
      jurisdiction, or (iv) such information has been made generally available to
      the
      public other than by disclosure in violation of this Agreement or any other
      Transaction Document. The Company agrees that it shall, upon learning that
      disclosure of such information concerning an Investor is sought in or by a
      court
      or governmental body of competent jurisdiction or through other means, give
      prompt written notice to such Investor and allow such Investor, at the
      Investor’s expense, to undertake appropriate action to prevent disclosure of, or
      to obtain a protective order for, such information.

     

    (k) Without
      limiting any obligation of the Company under the Securities
      Purchase

    
      
        
        

      

      
        -9-

        
          

        

      

      
        
        

      

    

    Agreement,
      the Company shall use its best efforts either to (i) cause all of the
      Registrable Securities covered by a Registration Statement to be listed on
      each
      securities exchange on which securities of the same class or series issued
      by
      the Company are then listed, if any, if the listing of such Registrable
      Securities is then permitted under the rules of such exchange, or (ii) secure
      designation and quotation of all of the Registrable Securities covered by a
      Registration Statement on The
      Nasdaq Global Select Market,
      or
      (iii) if, despite the Company’s best efforts to satisfy the preceding clauses
      (i) or (ii) the Company is unsuccessful in satisfying the preceding clauses
      (i)
      or (ii), to secure the inclusion for quotation on The Nasdaq Global Select
      Market for such Registrable Securities and, without limiting the generality
      of
      the foregoing, to use its best efforts to arrange for at least two market makers
      to register with the National Association of Securities Dealers, Inc.
      (“NASD”)
      as
      such with respect to such Registrable Securities. The Company shall pay all
      fees
      and expenses in connection with satisfying its obligation under this Section
      00.

     

    (l) The
      Company shall cooperate with the Investors who hold Registrable Securities
      being
      offered and, to the extent applicable, facilitate the timely preparation and
      delivery of certificates (not bearing any restrictive legend) representing
      the
      Registrable Securities to be offered pursuant to a Registration Statement and
      enable such certificates to be in such denominations or amounts (as the case
      may
      be) as the Investors may reasonably request and registered in such names as
      the
      Investors may request.

     

    (m) If
      reasonably requested by an Investor in writing, the Company shall within ten
      (10) days of receipt of notice from such Investor and subject to Section
00
      hereof
      (but (x) not more often than once in any 30-day period and (y) not during any
      15-day period prior to the time the Company is required to file its Quarterly
      Report on Form 10-Q or any 15-day period prior to the time the Company is
      required to file its Annual Report on Form 10-K) (i) incorporate in a prospectus
      supplement or post-effective amendment such information as an Investor
      reasonably requests to be included therein relating to the sale and distribution
      of Registrable Securities, including, without limitation, information with
      respect to the number of Registrable Securities being offered or sold, the
      purchase price being paid therefor and any other terms of the offering of the
      Registrable Securities to be sold in such offering; (ii) make all required
      filings of such prospectus supplement or post-effective amendment after being
      notified of the matters to be incorporated in such prospectus supplement or
      post-effective amendment; and (iii) supplement or make amendments to any
      Registration Statement if reasonably requested by an Investor holding any
      Registrable Securities.

     

    (n) The
      Company shall use its best efforts to cause the Registrable Securities covered
      by a Registration Statement to be registered with or approved by such other
      governmental agencies or authorities as may reasonably be necessary to
      consummate the disposition of such Registrable Securities.

     

    (o) The
      Company shall make generally available to its security holders as soon as
      practical, but not later than ninety (90) days after the close of the period
      covered thereby, an earnings statement (in form complying with, and in the
      manner provided by, the provisions of Rule 158 under the 1933 Act) covering
      a
      twelve-month period beginning not later than the first day of the Company’s
      fiscal quarter next following the effective date of the Registration
      Statement.

    
      
        
        

      

      
        -10-

        
          

        

      

      
        
        

      

    

    (p) The
      Company shall otherwise use its best efforts to comply in all material respects
      with all applicable rules and regulations of the SEC in connection with any
      registration hereunder.

     

    (q) Within
      two (2) Business Days after a Registration Statement which covers Registrable
      Securities is declared effective by the SEC, the Company shall deliver, and
      shall cause legal counsel for the Company to deliver, to the transfer agent
      for
      such Registrable Securities (with copies to the Investors whose Registrable
      Securities are included in such Registration Statement) confirmation that such
      Registration Statement has been declared effective by the SEC in the form
      attached hereto as Exhibit
      A.

     

    (r) Notwithstanding
      anything to the contrary herein, at any time after the Effective Date of the
      applicable Registration Statement, the Company may delay the disclosure of
      material, non-public information concerning the Company or any of its
      subsidiaries, the disclosure of which at the time is not, in the good faith
      opinion of the Board of Directors of the Company, in the best interest of the
      Company and, in the opinion of counsel to the Company, otherwise required (a
      “Grace
      Period”);
      provided,
      that
      the Company shall promptly (i) notify the Investors in writing of the invocation
      of a Grace Period (provided
      that in
      each notice the Company will not disclose any material, non-public information
      to the Investors) and the date on which the Grace Period will begin, and
      (ii) notify the Investors in writing of the date on which the Grace Period
      ends; and, provided
      further,
      that no
      Grace Period shall exceed fifteen (15) consecutive days and during any three
      hundred sixty five (365) day period such Grace Periods shall not exceed an
      aggregate of forty-five (45) days and the first day of any Grace Period must
      be
      at least five (5) Trading Days after the last day of any prior Grace Period
      (each, an “Allowable
      Grace Period”);
      provided,
      that no
      Allowable Grace Period may exist during the first thirty (30) Business Days
      after the Effective Date of the applicable Registration Statement. For purposes
      of determining the length of a Grace Period above, the Grace Period shall begin
      on and include the date the Investors receive the notice referred to in clause
      (i) and shall end on and include the later of the date the Investors receive
      the
      notice referred to in clause (ii) and the date referred to in such notice.
      The
      provisions of Section 00
      hereof
      shall not be applicable during the period of any Allowable Grace Period. Upon
      expiration of the Grace Period, the Company shall again be bound by the first
      sentence of Section 00
      with
      respect to the information giving rise thereto unless such material, nonpublic
      information is no longer applicable.

     

    
      	
              4.

            	
              Obligations
                of the Investors.

            

    

     

    (a) At
      least
      five (5) Business Days prior to the first anticipated filing date of a
      Registration Statement, the Company shall notify each Investor in writing of
      the
      information the Company requires from each such Investor. It shall be a
      condition precedent to the obligations of the Company to complete the
      registration pursuant to this Agreement with respect to the Registrable
      Securities of a particular Investor that such Investor shall furnish to the
      Company such information regarding itself, the Registrable Securities held
      by it
      and the intended method of disposition of the Registrable Securities held by
      it,
      as shall be reasonably required to effect and maintain the effectiveness of
      the
      registration of such Registrable Securities and shall execute such documents
      in
      connection with such registration as the Company may reasonably request.

     

    (b) Each
      Investor, by such Investor’s acceptance of the Registrable Securities,
      agrees

    
      
        
        

      

      
        -11-

        
          

        

      

      
        
        

      

    

    to
      cooperate with the Company as reasonably requested by the Company in connection
      with the preparation and filing of any Registration Statement hereunder, unless
      such Investor has notified the Company in writing of such Investor’s election to
      exclude all of such Investor’s Registrable Securities from such Registration
      Statement.

     

    (c) Each
      Investor agrees that, upon receipt of any notice from the Company of the
      happening of any event of the kind described in Section 0
      or the
      first sentence of 3(f)
      or the
      Investor receives a notice from the Company that a Grace Period is in effect,
      such Investor will immediately discontinue disposition of Registrable Securities
      pursuant to any Registration Statement(s) covering such Registrable Securities
      until such Investor’s receipt of the copies of the supplemented or amended
      prospectus contemplated by Section 0
      or the
      first sentence of Section 3(f) or receipt of notice that no supplement or
      amendment is required. Notwithstanding anything to the contrary in this Section
      00,
      the
      Company shall cause its transfer agent to deliver unlegended shares of Common
      Stock to a transferee of an Investor in accordance with the terms of the
      Securities Purchase Agreement in connection with any sale of Registrable
      Securities with respect to which such Investor has entered into a contract
      for
      sale prior to the Investor’s receipt of a notice from the Company of the
      happening of any event of the kind described in Section 0
      or the
      first sentence of Section 3(f) and for which such Investor has not yet
      settled.

     

    (d) Each
      Investor covenants and agrees that it will comply with the prospectus delivery
      requirements of the 1933 Act as applicable to it in connection with sales of
      Registrable
      Securities pursuant to the Registration Statement.

     

    (e) Each
      Investor covenants and agrees to deliver a Registration Statement Questionnaire
      in the form attached hereto as Exhibit
      C
      no later
      than five (5) Business Days prior to the Filing Deadline.

     

    
      	
              5.

            	
              Expenses
                of Registration.

            

    

     

    All
      reasonable expenses, other than underwriting discounts and commissions, incurred
      in connection with registrations, filings or qualifications pursuant to Sections
      0
      and
0,
      including, without limitation, all registration, listing and qualifications
      fees, printers and accounting fees, and fees and disbursements of counsel for
      the Company shall be paid by the Company. The Company shall also reimburse
      Magnetar Capital Master Fund, Ltd. for the fees and disbursements of Legal
      Counsel in connection with registration, filing or qualification pursuant to
      Sections 0
      and
0
      of this
      Agreement which amount shall be limited to $10,000.

     

    
      	
              6.

            	
              Indemnification.

            

    

     

    In
      the
      event any Registrable Securities are included in a Registration Statement under
      this Agreement:

     

    (a) To
      the
      fullest extent permitted by law, the Company will, and hereby does, indemnify,
      hold harmless and defend each Investor, the directors, officers, members,
      partners, employees, agents, representatives of, and each Person, if any, who
      controls any Investor within the meaning of the 1933 Act or the 1934 Act (each,
      an “Indemnified
      Person”),
      against any losses, claims, damages, liabilities, judgments, fines, penalties,
      charges, costs, reasonable attorneys’ fees, or expenses (collectively,
“Claims”)
      incurred in investigating, preparing or

    
      
        
        

      

      
        -12-

        
          

        

      

      
        
        

      

    

    defending
      any action, claim, suit, inquiry, proceeding, investigation or appeal taken
      from
      the foregoing by or before any court or governmental, administrative or other
      regulatory agency, body or the SEC, whether pending or threatened, whether
      or
      not an indemnified party is or may be a party thereto (“Indemnified
      Damages”),
      to
      which any of them may become subject insofar as such Claims (or actions or
      proceedings, whether commenced or threatened, in respect thereof) arise out
      of
      or are based upon: (i) any untrue statement or alleged untrue statement of
      a
      material fact in a Registration Statement or any post-effective amendment
      thereto or in any filing made in connection with the qualification of the
      offering under the securities or other “blue sky” laws of any jurisdiction in
      which Registrable Securities are offered (“Blue
      Sky Filing”),
      or
      the omission or alleged omission to state a material fact required to be stated
      therein or necessary to make the statements therein not misleading, (ii) any
      untrue statement or alleged untrue statement of a material fact contained in
      any
      preliminary prospectus if used prior to the effective date of such Registration
      Statement, or contained in the final prospectus (as amended or supplemented,
      if
      the Company files any amendment thereof or supplement thereto with the SEC)
      or
      the omission or alleged omission to state therein any material fact necessary
      to
      make the statements made therein, in light of the circumstances under which
      the
      statements therein were made, not misleading or (iii) any violation or alleged
      violation by the Company of the 1933 Act, the 1934 Act, any other law,
      including, without limitation, any state securities law, or any rule or
      regulation thereunder relating to the offer or sale of the Registrable
      Securities pursuant to a Registration Statement (the matters in the foregoing
      clauses (i) through (iii) being, collectively, “Violations”).
      Subject to Section 00,
      the
      Company shall reimburse the Indemnified Persons, promptly as such expenses
      are
      incurred and are due and payable, for any legal fees or other reasonable
      expenses incurred by them in connection with investigating or defending any
      such
      Claim. Notwithstanding anything to the contrary contained herein, the
      indemnification agreement contained in this Section 00:
      (i)
      shall not apply to a Claim by an Indemnified Person arising out of or based
      upon
      a Violation which occurs in reliance upon and in conformity with information
      furnished in writing to the Company by such Indemnified Person for such
      Indemnified Person expressly for use in connection with the preparation of
      such
      Registration Statement or any such amendment thereof or supplement thereto
      and
      (ii) shall not be available to the extent such Claim is based on a failure
      of
      the Investor to deliver or to cause to be delivered the prospectus made
      available by the Company (to the extent applicable), including a corrected
      prospectus, if such prospectus or corrected prospectus was timely made available
      by the Company pursuant to Section 0
      and then
      only if, and to the extent that, following the receipt of the corrected
      prospectus no grounds for such Claim would have existed; and (iii) shall not
      apply to amounts paid in settlement of any Claim if such settlement is effected
      without the prior written consent of the Company, which consent shall not be
      unreasonably withheld or delayed. Such indemnity shall remain in full force
      and
      effect regardless of any investigation made by or on behalf of the Indemnified
      Person and shall survive the transfer of any of the Registrable Securities
      by
      any of the Investors pursuant to Section 0.

     

    (b) In
      connection with any Registration Statement in which an Investor is
      participating, such Investor agrees to severally and not jointly indemnify,
      hold
      harmless and defend, to the same extent and in the same manner as is set forth
      in Section 00,
      the
      Company, each of its directors, each of its officers who signs the Registration
      Statement and each Person, if any, who controls the Company within the meaning
      of the 1933 Act or the 1934 Act (each, an “Indemnified
      Party”),
      against any Claim or Indemnified Damages to which any of them may become
      subject, under the 1933 Act, the 1934 Act or otherwise, insofar as such Claim
      or

    
      
        
        

      

      
        -13-

        
          

        

      

      
        
        

      

    

    Indemnified
      Damages arise out of or are based upon any Violation, in each case, to the
      extent, and only to the extent, that such Violation occurs in reliance upon
      and
      in conformity with written information furnished to the Company by such Investor
      expressly for use in connection with such Registration Statement; and, subject
      to Section 00,
      such
      Investor will reimburse any legal or other expenses reasonably incurred by
      an
      Indemnified Party in connection with investigating or defending any such Claim;
      provided,
      however,
      that
      the indemnity agreement contained in this Section 00
      and the
      agreement with respect to contribution contained in Section 0
      shall
      not apply to amounts paid in settlement of any Claim if such settlement is
      effected without the prior written consent of such Investor, which consent
      shall
      not be unreasonably withheld or delayed; provided,
      further,
      however,
      that
      such Investor shall be liable under this Section 00
      for only
      that amount of a Claim or Indemnified Damages as does not exceed the net
      proceeds to such Investor as a result of the sale of Registrable Securities
      pursuant to such Registration Statement. Such indemnity shall remain in full
      force and effect regardless of any investigation made by or on behalf of such
      Indemnified Party and shall survive the transfer of any of the Registrable
      Securities by any of the Investors pursuant to Section 0. 

     

    (c) Promptly
      after receipt by an Indemnified Person or Indemnified Party (as the case may
      be)
      under this Section 0
      of
      notice of the commencement of any action or proceeding (including any
      governmental action or proceeding) involving a Claim, such Indemnified Person
      or
      Indemnified Party (as the case may be) shall, if a Claim in respect thereof
      is
      to be made against any indemnifying party under this Section 0,
      deliver
      to the indemnifying party a written notice of the commencement thereof, and
      the
      indemnifying party shall have the right to participate in, and, to the extent
      the indemnifying party so desires, jointly with any other indemnifying party
      similarly noticed, to assume control of the defense thereof with counsel
      mutually satisfactory to the indemnifying party and the Indemnified Person
      or
      the Indemnified Party (as the case may be); provided,
      however,
      that an
      Indemnified Person or Indemnified Party (as the case may be) shall have the
      right to retain its own counsel with the fees and expenses of such counsel
      to be
      paid by the indemnifying party if: (i) the indemnifying party has agreed in
      writing to pay such fees and expenses; (ii) the indemnifying party shall have
      failed promptly to assume the defense of such Claim and to employ counsel
      reasonably satisfactory to such Indemnified Person or Indemnified Party (as
      the
      case may be) in any such Claim; or (iii) the named parties to any such Claim
      (including any impleaded parties) include both such Indemnified Person or
      Indemnified Party (as the case may be) and the indemnifying party, and such
      Indemnified Person or such Indemnified Party (as the case may be) shall have
      been advised by counsel that a conflict of interest is likely to exist if the
      same counsel were to represent such Indemnified Person or such Indemnified
      Party
      and the indemnifying party (in which case, if such Indemnified Person or such
      Indemnified Party (as the case may be) notifies the indemnifying party in
      writing that it elects to employ separate counsel at the expense of the
      indemnifying party, then the indemnifying party shall not have the right to
      assume the defense thereof and such counsel shall be at the expense of the
      Indemnifying Party, provided
      further,
      that in
      the case of clause (iii) above the indemnifying party shall not be responsible
      for the reasonable fees and expenses of more than one (1) separate legal counsel
      for such Indemnified Person or Indemnified Party (as the case may be). The
      Indemnified Party or Indemnified Person (as the case may be) shall reasonably
      cooperate with the indemnifying party in connection with any negotiation or
      defense of any such action or Claim by the indemnifying party and shall furnish
      to the indemnifying party all information reasonably available to the
      Indemnified Party or Indemnified Person (as the case may be) which relates
      to
      such action or Claim. The indemnifying party shall

    
      
        
        

      

      
        -14-

        
          

        

      

      
        
        

      

    

    keep
      the
      Indemnified Party or Indemnified Person (as the case may be) reasonably apprised
      at all times as to the status of the defense or any settlement negotiations
      with
      respect thereto. No indemnifying party shall be liable for any settlement of
      any
      action, claim or proceeding effected without its prior written consent,
provided,
      however,
      that
      the indemnifying party shall not unreasonably withhold, delay or condition
      its
      consent. No indemnifying party shall, without the prior written consent of
      the
      Indemnified Party or Indemnified Person (as the case may be), consent to entry
      of any judgment or enter into any settlement or other compromise which does
      not
      include as an unconditional term thereof the giving by the claimant or plaintiff
      to such Indemnified Party or Indemnified Person (as the case may be) of a
      release from all liability in respect to such Claim or litigation, and such
      settlement shall not include any admission as to fault on the part of the
      Indemnified Party. Following indemnification as provided for hereunder, the
      indemnifying party shall be subrogated to all rights of the Indemnified Party
      or
      Indemnified Person (as the case may be) with respect to all third parties,
      firms
      or corporations relating to the matter for which indemnification has been made.
      The failure to deliver written notice to the indemnifying party within a
      reasonable time of the commencement of any such action shall not relieve such
      indemnifying party of any liability to the Indemnified Person or Indemnified
      Party (as the case may be) under this Section 0,
      except
      to the extent that the indemnifying party is materially and adversely prejudiced
      in its ability to defend such action.

     

    (d) No
      Person
      involved in the sale of Registrable Securities who is guilty of fraudulent
      misrepresentation (within the meaning of Section 11(f) of the Securities Act)
      in
      connection with such sale shall be entitled to indemnification from any Person
      involved in such sale of Registrable Securities who is not guilty of fraudulent
      misrepresentation.

     

    (e) The
      indemnification required by this Section 0
      shall be
      made by periodic payments of the amount thereof during the course of the
      investigation or defense, as and when bills are received or Indemnified Damages
      are incurred.

     

    (f) The
      indemnity agreements contained herein shall be in addition to (i) any cause
      of
      action or similar right of the Indemnified Party or Indemnified Person against
      the indemnifying party or others, and (ii) any liabilities the indemnifying
      party may be subject to pursuant to the law.

     

    
      	
              7.

            	
              Contribution.

            

    

     

    To
      the
      extent any indemnification by an indemnifying party is prohibited or limited
      by
      law, the indemnifying party agrees to make the maximum contribution with respect
      to any amounts for which it would otherwise be liable under Section 0
      to the
      fullest extent permitted by law; provided,
      however,
      that:
      (i) no contribution shall be made under circumstances where the maker would
      not
      have been liable for indemnification under the fault standards set forth in
      Section 0
      of this
      Agreement, (ii) no Person involved in the sale of Registrable Securities which
      Person is guilty of fraudulent misrepresentation (within the meaning of Section
      11(f) of the 1933 Act) in connection with such sale shall be entitled to
      contribution from any Person involved in such sale of Registrable Securities
      who
      was not guilty of fraudulent misrepresentation; and (iii) contribution by any
      seller of Registrable Securities shall be limited in amount to the net amount
      of
      proceeds received by such seller from the sale of such Registrable Securities
      pursuant to such Registration Statement (taking account of any amounts paid
      or
payable
      under Section 0).

     

    
      
        
        

      

      
        -15-

        
          

        

      

      
        
        

      

    

     

     

    
      	
              8.

            	
              Reports
                Under the 1934 Act.

            

    

     

    With
      a
      view to making available to the Investors the benefits of Rule 144 promulgated
      under the 1933 Act or any other similar rule or regulation of the SEC that
      may
      at any time permit the Investors to sell securities of the Company to the public
      without registration (“Rule
      144”),
      the
      Company agrees to:

     

    (a) make
      and
      keep public information available, as those terms are understood and defined
      in
      Rule 144; 

     

    (b) file
      with
      the SEC in a timely manner all reports and other documents required of the
      Company under the 1933 Act and the 1934 Act so long as the Company remains
      subject to such requirements (it being understood that nothing herein shall
      limit the Company’s obligations under Section 4(c) of the Securities Purchase
      Agreement) and the filing of such reports and other documents is required for
      the applicable provisions of Rule 144; and

     

    (c) furnish
      to each Investor so long as such Investor owns Registrable Securities, promptly
      upon request, (i) a written statement by the Company, if true, that it has
      complied with the reporting requirements of Rule 144 and the 1934 Act, (ii)
      a
      copy of the most recent annual or quarterly report of the Company and such
      other
      reports and documents so filed by the Company with the SEC if such reports
      are
      not publicly available via EDGAR, and (iii) such other information as may be
      reasonably requested to permit the Investors to sell such securities pursuant
      to
      Rule 144 without registration.

     

    
      	
              9.

            	
              Assignment
                of Registration Rights.

            

    

     

    The
      rights under this Agreement shall be automatically assignable by the Investors
      to any transferee of all or any portion of such Investor’s Registrable
      Securities if: (i) the Investor agrees in writing with the transferee or
      assignee to assign such rights, and a copy of such agreement is furnished to
      the
      Company within five (5) Business Days after such assignment; (ii) the Company
      is, within five (5) Business Days after such transfer or assignment, furnished
      with written notice of (a) the name and address of such transferee or assignee,
      and (b) the securities with respect to which such registration rights are being
      transferred or assigned; (iii) immediately following such transfer or assignment
      the further disposition of such securities by the transferee or assignee is
      restricted under the 1933 Act or applicable state securities laws if so
      required; (iv) at or before the time the Company receives the written notice
      contemplated by clause (ii) of this sentence the transferee or assignee agrees
      in writing with the Company to be bound by all of the provisions contained
      herein; (v) such transfer shall have been made in accordance with the applicable
      requirements of the Securities Purchase Agreement; and (vi) such transfer shall
      have been conducted in accordance with all applicable federal and state
      securities laws.

     

    
      	
              10.

            	
              Amendment
                of Registration Rights.

            

    

     

    Provisions
      of this Agreement may be amended and the observance thereof may be waived
      (either generally or in a particular instance and either retroactively or
      prospectively), only

    
      
        
        

      

      
        -16-

        
          

        

      

      
        
        

      

    

    with
      the
      written consent of the Company and the Required Holders, provided
      that any
      Investor may give a waiver in writing as to itself. Any amendment or waiver
      effected in accordance with this Section 0
      shall be
      binding upon each Investor and the Company. No such amendment or waiver (unless
      given pursuant to the foregoing proviso) shall be effective to the extent that
      it applies to less than all of the holders of the Registrable Securities. No
      consideration shall be offered or paid to any Person to amend or consent to
      a
      waiver or modification of any provision of any of this Agreement unless the
      same
      consideration also is offered to all of the parties to this
      Agreement.

     

    
      	
              11.

            	
              Miscellaneous.

            

    

     

    (a) Solely
      for purposes of this Agreement, a Person is deemed to be a holder of Registrable
      Securities whenever such Person owns or is deemed to own of record such
      Registrable Securities. If the Company receives conflicting instructions,
      notices or elections from two or more Persons with respect to the same
      Registrable Securities, the Company shall act upon the basis of instructions,
      notice or election received from such record owner of such Registrable
      Securities.

     

    (b) Any
      notices, consents, waivers or other communications required or permitted to
      be
      given under the terms of this Agreement must be in writing and will be deemed
      to
      have been delivered: (i) upon receipt, when delivered personally; (ii) upon
      receipt, when sent by facsimile (provided confirmation of transmission is
      mechanically or electronically generated and kept on file by the sending party);
      or (iii) one (1) Business Day after deposit with a nationally recognized
      overnight delivery service with next day delivery specified, in each case,
      properly addressed to the party to receive the same. The addresses and facsimile
      numbers for such communications shall be:

     

    If
      to the
      Company: 

     

    PokerTek,
      Inc.

    1020
      Crews Road, Suite J

    Matthews,
      North Carolina 28106 

    Telephone:
      (704) 849-0860

    Facsimile:
      (704) 849-9148

    Attention:
      Chief Executive Officer

    

    With
      a
      copy (for informational purposes only) to:

     

    Womble
      Carlyle Sandridge & Rice, PLLC

    301
      South
      College Street, Suite 3500

    Charlotte,
      North Carolina 28202-6037

    Telephone:
      (704) 331-4964

    Facsimile:
      (704) 338-7812

    Attention:
      Robert M. Donlon, Esq.

     

    If
      to the
      Transfer Agent:

     

    American
      Stock Transfer & Trust

    6201
      15th
      Avenue

    Brooklyn,
      New York 11219

    Telephone:
      (800) 937-5449

    Facsimile:
      (718) 236-2641

    Attention:
      Operations Center

     

    
      
        
        

      

      
        -17-

        
          

        

      

      
        
        

      

    

     

    If
      to
      Legal Counsel:

     

    Greenberg
      Traurig, LLP

    77
      W.
      Wacker Drive, Suite 2400

    Chicago,
      Illinois 60602

    Telephone:
      (312) 456-8400

    Facsimile:
      (312) 456-8435

    Attention: 
      Peter H. Lieberman, Esq.

    Todd
      A.
      Mazur, Esq.

     

    If
      to a
      Buyer, to its address and facsimile number set forth on the Schedule of Buyers
      attached hereto, with copies to such Buyer’s representatives as set forth on the
      Schedule of Buyers, or to such other address and/or facsimile number and/or
      to
      the attention of such other Person as the recipient party has specified by
      written notice given to each other party five (5) days prior to the
      effectiveness of such change provided,
      that
      Greenberg Traurig, LLP shall only be provided notices sent to Magnetar Capital
      Master Fund, Ltd. Written confirmation of receipt (A) given by the recipient
      of
      such notice, consent, waiver or other communication, (B) mechanically or
      electronically generated by the sender’s facsimile machine containing the time,
      date, recipient facsimile number and an image of the first page of such
      transmission or (C) provided by a courier or overnight courier service shall
      be
      rebuttable evidence of personal service, receipt by facsimile or receipt from
      a
      nationally recognized overnight delivery service in accordance with clause
      (i),
      (ii) or (iii) above, respectively.

     

    (c) Failure
      of any party to exercise any right or remedy under this Agreement or otherwise,
      or delay by a party in exercising such right or remedy, shall not operate as
      a
      waiver thereof.

     

    (d) All
      questions concerning the construction, validity, enforcement and interpretation
      of this Agreement shall be governed by the internal laws of the State of New
      York, without giving effect to any choice of law or conflict of law provision
      or
      rule (whether of the State of New York or any other jurisdictions) that would
      cause the application of the laws of any jurisdictions other than the State
      of
      New York. Each party hereby irrevocably submits to the exclusive jurisdiction
      of
      the state and federal courts sitting in The City of New York, Borough of
      Manhattan, for the adjudication of any dispute hereunder or in connection
      herewith or with any transaction contemplated hereby or discussed herein, and
      hereby irrevocably waives, and agrees not to assert in any suit, action or
      proceeding, any claim that it is not personally subject to the jurisdiction
      of
      any such court, that such suit, action or proceeding is brought in an
      inconvenient forum or that the venue of such suit, action or proceeding is
      improper. Each party hereby irrevocably waives personal service of process
      and
      consents to process being served in any such suit, action or proceeding by
      mailing a copy thereof to such party at the address for such notices to it
      under
      this Agreement and agrees that such service shall constitute good and sufficient
      service of process and notice thereof. Nothing contained herein shall be deemed
      to limit in any way any right to serve process in any manner permitted by law.
      If any provision of this Agreement shall be invalid or unenforceable in any
      jurisdiction, such invalidity or unenforceability shall not affect the validity
      or enforceability of the remainder of this Agreement in that jurisdiction or
      the
      validity or enforceability of any provision of this Agreement in any other
      jurisdiction. EACH PARTY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE, AND
      AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE
      HEREUNDER OR IN CONNECTION HEREWITH OR ARISING OUT OF THIS AGREEMENT OR ANY
      TRANSACTION CONTEMPLATED HEREBY.

     

    
      
        
        

      

      
        -18-

        
          

        

      

      
        
        

      

    

     

    (e) This
      Agreement, the other Transaction Documents (as defined in the Securities
      Purchase Agreement), the schedules and exhibits attached hereto and thereto
      and
      the instruments referenced herein and therein constitute the entire agreement
      among the parties hereto with respect to the subject matter hereof and thereof.
      There are no restrictions, promises, warranties or undertakings, other than
      those set forth or referred to herein and therein. This Agreement, the other
      Transaction Documents, the schedules and exhibits attached hereto and thereto
      and the instruments referenced herein and therein supersede all prior agreements
      and understandings among the parties hereto with respect to the subject matter
      hereof and thereof.

     

    (f) Subject
      to the requirements of Section 0,
      this
      Agreement shall inure to the benefit of and be binding upon the permitted
      successors and assigns of each of the parties hereto.

     

    (g) The
      headings in this Agreement are for convenience of reference only and shall
      not
      limit or otherwise affect the meaning hereof. Unless the context clearly
      indicates otherwise, each pronoun herein shall be deemed to include the
      masculine, feminine, neuter, singular and plural forms thereof. The terms
“including,”
      “includes,”
      “include”
and
      words of like import shall be construed broadly as if followed by the words
      “without limitation.” The terms “herein,”
      “hereunder,”
      “hereof”
and
      words of like import refer to this entire Agreement instead of just the
      provision in which they are found.

     

    (h) This
      Agreement may be executed in two or more identical counterparts, all of which
      shall be considered one and the same agreement and shall become effective when
      counterparts have been signed by each party and delivered to the other party.
      In
      the event that any signature is delivered by facsimile transmission or by an
      e-mail which contains an electronic file of an executed signature page, such
      signature page shall create a valid and binding obligation of the party
      executing (or on whose behalf such signature is executed) with the same force
      and effect as if such facsimile or electronic file signature page (as the case
      may be) were an original thereof.

     

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

     

    (j) All
      consents and other determinations required to be made by the Investors pursuant
      to this Agreement shall be made, unless otherwise specified in this Agreement,
      by the Required Holders.

     

    
      
        
        

      

      
        -19-

        
          

        

      

      
        
        

      

    

     

    (k) The
      language used in this Agreement will be deemed to be the language chosen by
      the
      parties to express their mutual intent and no rules of strict construction
      will
      be applied against any party. 

     

    (l) This
      Agreement is intended for the benefit of the parties hereto and their respective
      permitted successors and assigns, and is not for the benefit of, nor may any
      provision hereof be enforced by, any other Person, other than the Persons
      referred to in Section 0
      and
0
      hereof.

     

    (m) The
      obligations of each Investor under this Agreement and the other Transaction
      Documents are several and not joint with the obligations of any other Investor,
      and no Investor shall be responsible in any way for the performance of the
      obligations of any other Investor under this Agreement or any other Transaction
      Document. Nothing contained herein or in any other Transaction Document, and
      no
      action taken by any Investor pursuant hereto or thereto, shall be deemed to
      constitute the Investors as a partnership, an association, a joint venture
      or
      any other kind of group or entity, or create a presumption that the Investors
      are in any way acting in concert or as a group or entity with respect to such
      obligations or the transactions contemplated by the Transaction Documents or
      any
      matters, and the Company acknowledges that the Investors are not acting in
      concert or as a group with respect to such obligations or the transactions
      contemplated by this Agreement or any of the other the Transaction Documents.
      Each Investor shall be entitled to independently protect and enforce its rights,
      including, without limitation, the rights arising out of this Agreement or
      out
      of any other Transaction Documents, and it shall not be necessary for any other
      Investor to be joined as an additional party in any proceeding for such purpose.
      The use of a single agreement with respect to the obligations of the Company
      contained was solely in the control of the Company, not the action or decision
      of any Investor, and was done solely for the convenience of the Company and
      not
      because it was required or requested to do so by any Investor. It is expressly
      understood and agreed that each provision contained in this Agreement and in
      each other Transaction Document is between the Company and an Investor, solely,
      and not between the Company and the Investors collectively and not between
      and
      among Investors.

     

    [signature
      pages follow]

     

    
      
        
        

      

      
        -20-

        
          

        

      

      
        
        

      

    

     

    IN
      WITNESS WHEREOF,
      each
      Buyer and the Company have caused their respective signature page to this
      Registration Rights Agreement to be duly executed as of the date first written
      above.

     

    
      	 	
              COMPANY:

            
	 	
               

              POKERTEK,
                INC.

               

              By: 
                /s/ Gehrig
                White                                         
                

              Name: G.
                White                                  
                

              Title:
                C. E.
                O.                                               
                

               

            

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    IN
      WITNESS WHEREOF,
      each
      Buyer and the Company have caused their respective signature page to this
      Registration Rights Agreement to be duly executed as of the date first written
      above.

     

    

    
      	 	
              BUYERS:

            
	 	
              MAGNETAR
                CAPITAL MASTER FUND, LTD.

               

              By: Magnetar
                Financial LLC

              Its: Investment
                Manager

            
	 	
               

              /s/
                Doug
                Litowitz                                            

              By: Doug
                Litowitz

              Its: Counsel

            

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    IN
      WITNESS WHEREOF,
      each
      Buyer and the Company have caused their respective signature page to this
      Registration Rights Agreement to be duly executed as of the date first written
      above.

    

      
        	 	
                SRB
                  Greenway Capital, L.P.

              
	 	 
	 	
                By:
                  SRB Management, L.P., General Partner

              
	 	 
	 	
                By:
                  BC Advisors, L.L.C., General Partner

              
	 	 
	 	 
	 	
                By: 
                  /s/ Steven R.
                  Becker                            
                  

              
	 	
                Steven
                  R. Becker, Member

              
	 	 
	 	 
	 	
                SRB
                  Greenway Capital (QP), L.P.

              
	 	 
	 	
                By:
                  SRB Management, L.P., General Partner

              
	 	 
	 	
                By:
                  BC Advisors, L.L.C., General Partner

              
	 	 
	 	 
	 	
                
                  By: 
                    /s/ Steven R.
                    Becker                            
                    

                

              
	 	
                Steven
                  R. Becker, Member

              
	 	 
	 	 
	 	
                SRB
                  Greenway Offshore Operating Fund, L.P.

              
	 	 
	 	
                By:
                  SRB Management, L.P., General Partner

              
	 	 
	 	
                By:
                  BC Advisors, LLC, General Partner

              
	 	 
	 	 
	 	
                By:
                  /s/ Steve
                  Becker                                      
                  

              
	 	
                Steve
                  Becker, Member

              

      

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    IN
      WITNESS WHEREOF,
      each
      Buyer and the Company have caused their respective signature page to this
      Registration Rights Agreement to be duly executed as of the date first written
      above.

    

    
      	 	
              JANUS
                CAPITAL MANAGEMENT LLC

            
	 	
              (“Janus”)
                on behalf of each of the following 

            
	 	
              funds
                and portfolio advised by Janus:

            
	 	 
	 	
              JANUS
                VENTURE FUND (a series of Janus 

            
	 	
              Investment
                Fund), and

            
	 	 
	 	
              JANUS
                US VENTURE FUND (a series of Janus 

            
	 	
              Capital
                Funds Plc), and

            
	 	 
	 	
              SMALL
                CAP GROWTH PORTFOLIO (a series 

            
	 	
              of
                Ohio National Fund Inc.),

            
	 	 
	 	 
	 	
              By: 
                /s/ William
                Bales                                                  
                

            
	 	
              Name:
                William Bales

            
	 	
              Title:
                Portfolio Manager and authorized 

            
	 	
              signatory
                as investment adviser to each of the 

            
	 	
              aforementioned
                funds and portfolios

            

    

    

    Address
      for Notice:

    151
      Detroit Street

    Denver,
      Colorado 80206

    Attn:
      Kelly Hagg, AVP and Associate Counsel

    Tel:
      303
      394 6457

    Fax:
      303
      394 7714

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    SCHEDULE
      OF BUYERS

     

    
      	
              Buyer
                

            	
              Buyer
                Address

              and
                Facsimile Number

            	
              Buyer’s
                Representative’s Address 

              and
                Facsimile Number

            
	
              Magnetar
                Capital Master Fund, Ltd.

            	
              1603
                Orrington Avenue, Suite 1300

              Evanston,
                Illinois 60201

              Attn:
                Michael Balkin and Marc Falcone

              Facsimile:
                (847)
                905-5603

            	
              Greenberg
                Traurig, LLP

              77
                W. Wacker Drive, Suite 2400

              Chicago,
                Illinois 60601

              Attention: 
                Peter H. Lieberman

              Todd
                A. Mazur

              Facsimile:
                (312) 456-8435

              Telephone:
                (312) 456-8400

            
	
              Janus
                Venture Fund (a series of Janus Investment Fund)

            	
              151
                Detroit Street 

              Denver,
                Colorado 80206

              Attn:
                Kelly Hagg, AVP and 

              Associate
                Counsel

              Facsimile:
                (303) 394-7714

            	
              151
                Detroit Street 

              Denver,
                Colorado 80206

              Attn:
                Kelly Hagg, AVP and 

              Associate
                Counsel

              Facsimile:
                (303) 394-7714

            
	
              Janus
                US Venture Fund (a series of Janus Capital Funds
                Plc)

               

            	
              151
                Detroit Street 

              Denver,
                Colorado 80206

              Attn:
                Kelly Hagg, AVP and 

              Associate
                Counsel

              Facsimile:
                (303) 394-7714

            	
              151
                Detroit Street 

              Denver,
                Colorado 80206

              Attn:
                Kelly Hagg, AVP and 

              Associate
                Counsel

              Facsimile:
                (303) 394-7714

            
	
              Small
                Cap Growth Portfolio (a series of Ohio National Fund
                Inc.)

            	
              151
                Detroit Street 

              Denver,
                Colorado 80206

              Attn:
                Kelly Hagg, AVP and 

              Associate
                Counsel

              Facsimile:
                (303) 394-7714

            	
              151
                Detroit Street 

              Denver,
                Colorado 80206

              Attn:
                Kelly Hagg, AVP and 

              Associate
                Counsel

              Facsimile:
                (303) 394-7714

            
	
              SRB
                Greenway Capital (QP), L.P.

            	
              300
                Crescent Court, Suite 1111

              Dallas,
                Texas 75201

              Attn:
                George Lee

              Facsimile:
                (214) 756-6079

            	
              N/A

            
	
              SRB
                Greenway Capital, L.P.

            	
              300
                Crescent Court, Suite 1111

              Dallas,
                Texas 75201

              Attn:
                George Lee

              Facsimile:
                (214) 756-6079

            	
              N/A

            
	
              SRB
                Greenway Offshore Operating Fund, L.P.

            	
              300
                Crescent Court, Suite 1111

              Dallas,
                Texas 75201

              Attn:
                George Lee

              Facsimile:
                (214) 756-6079

            	
              N/A

            

    

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    EXHIBIT
      A

     

    FORM
      OF NOTICE OF EFFECTIVENESS

    OF
      REGISTRATION STATEMENT

     

    ______________________

    ______________________

    ______________________

    Attention:
      _____________

     

    Re: PokerTek,
      Inc.

     

    Ladies
      and Gentlemen:

     

     

    [We
      are][I am] [an officer/counsel] to PokerTek, Inc., a North Carolina corporation
      (the “Company”),
      and
      have represented the Company in connection with that certain Securities Purchase
      Agreement (the “Securities
      Purchase Agreement”)
      entered into by and among the Company and the buyers named therein
      (collectively, the “Holders”)
      pursuant to which the Company issued to the Holders its shares of the Company’s
      common stock, no par value (the “Common
      Stock”),
      and
      warrants exercisable for shares of Common Stock (the “Warrants”).
      Pursuant to the Securities Purchase Agreement, the Company also has entered
      into
      a Registration Rights Agreement with the Holders (the “Registration
      Rights Agreement”)
      pursuant to which the Company agreed, among other things, to register the
      Registrable Securities (as defined in the Registration Rights Agreement),
      including the shares of Common Stock issuable upon exercise of the Warrants,
      under the Securities Act of 1933, as amended (the “1933
      Act”).
      In
      connection with the Company’s obligations under the Registration Rights
      Agreement, on ____________ ___, 200_, the Company filed a Registration Statement
      on Form S-1 (File No. 333-_____________) (the “Registration
      Statement”)
      with
      the Securities and Exchange Commission (the “SEC”)
      relating to the Registrable Securities which names each of the Holders as a
      selling stockholder thereunder.

     

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

     

    This
      letter shall serve as our standing instruction to you that, provided that a
      Rule
      424(b) prospectus has been filed with the SEC, the shares of Common Stock are
      freely transferable by the Holders pursuant to the Registration Statement.
      You
      need not require further letters from us to effect any future legend-free
      issuance or reissuance of shares of Common Stock to the Holders as contemplated
      by the Company’s Irrevocable Transfer Agent Instructions dated _________ __,
      200_.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

     

    Very
      truly yours,

     

    By:_____________________

    CC: [LIST
      NAMES OF HOLDERS]

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    EXHIBIT
      B

     

    SELLING
      SHAREHOLDERS

     

    The
      shares of common stock being offered by the selling shareholders are those
      previously issued to the selling shareholders and those issuable to the selling
      shareholders upon exercise of the warrants. For additional information regarding
      the issuance of those shares of common stock and warrants, see “Private
      Placement of Common Shares and Warrants” above. We are registering the shares of
      common stock in order to permit the selling shareholders to offer the shares
      for
      resale from time to time. Except for the ownership of the shares of common
      stock
      and the warrants issued pursuant to the Securities Purchase Agreement, the
      selling shareholders have not had any material relationship with us within
      the
      past three years.

     

    The
      table
      below lists the selling shareholders and other information regarding the
      beneficial ownership of the shares of common stock by each of the selling
      shareholders. The second column lists the number of shares of common stock
      beneficially owned by each selling shareholder, based on its ownership of the
      shares of common stock and the warrants, as of ________, 2007, assuming exercise
      of all the warrants held by the selling shareholders on that date, without
      regard to any limitations on exercise.

     

    The
      third
      column lists the shares of Common Stock being offered by this prospectus by
      the
      selling shareholders.

     

    In
      accordance with the terms of a registration rights agreement with the holders
      of
      the shares of common stock and the warrants, this prospectus generally covers
      the resale of the sum of (i) the number of shares of common stock equal to
      the
      number of shares of common stock issued and (ii) the number of shares of common
      stock issuable upon exercise of the related warrants, determined as if the
      outstanding warrants were exercised, as applicable, in full (without regard
      to
      any limitations on exercise contained therein), in each case, as of the trading
      day immediately preceding the date this registration statement was initially
      filed with the SEC. Because the exercise price of the warrants may be adjusted,
      the number of shares that will actually be issued may be more or less than
      the
      number of shares being offered by this prospectus. The fourth column assumes
      the
      sale of all of the shares offered by the selling shareholders pursuant to this
      prospectus.

     

    Under
      the
      terms of the warrants, a selling shareholder may not exercise the warrants,
      to
      the extent such exercise would cause such selling shareholder, together with
      its
      affiliates, to beneficially own a number of shares of common stock which would
      exceed 4.90% of our then outstanding shares of common stock following such
      exercise, excluding for purposes of such determination shares of common stock
      issuable upon exercise of the warrants which have not been exercised. The number
      of shares in the second column does not reflect this limitation. The selling
      shareholders may sell all, some or none of their shares in this offering. See
      “Plan of Distribution.”

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    

     

    
      	
              Name
                of Selling Stockholder

            	
              Number
                of Shares of Common Stock Owned Prior to Offering

            	
              Maximum
                Number of Shares of Common Stock to be Sold Pursuant to this
                Prospectus

            	
              Number
                of Shares of Common Stock Owned After Offering

            
	
              Magnetar
                Capital Master Fund, Ltd. (1)

            	 	 	
              0

            
	
              Janus
                Venture Fund (a series of Janus Investment Fund)

            	 	 	 
	
              Janus
                US Venture Fund (a series of Janus Capital Funds
                Plc)

            	 	 	 
	
              Small
                Cap Growth Portfolio (a series of Ohio National Fund
                Inc.)

            	 	 	 
	
              SRB
                Greenway Capital (QP), L.P.

            	 	 	 
	
              SRB
                Greenway Capital, L.P.

            	 	 	 
	
              SRB
                Greenway Offshore Operating Fund, L.P.

            	 	 	 

    

    

    (1)
      Magnetar Financial LLC is the investment advisor of Magnetar Capital Master
      Fund, Ltd. (“Magnetar Master Fund”) and consequently has voting control and
      investment discretion over securities held by Magnetar Master Fund. Alec
      Litowitz has voting control over Supernova Management LLC, the general partner
      of Magnetar Capital Partners LP, the sole managing member of Magnetar Financial
      LLC. As a result, Mr. Litowitz may be deemed to have beneficial ownership (as
      determined under Section 13(d) of the Securities Exchange Act of 1934, as
      amended) of any shares deemed to be beneficially owned by Magnetar Financial
      LLC.

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    PLAN
      OF DISTRIBUTION

     

    We
      are
      registering the shares of common stock previously issued to the selling
      shareholders and the shares of common stock issuable upon exercise of the
      warrants to permit the resale of these shares of common stock by the holders
      of
      the common stock and warrants from time to time after the date of this
      prospectus. We will not receive any of the proceeds from the sale by the selling
      shareholders of the shares of common stock. We will bear all fees and expenses
      incident to our obligation to register the shares of common stock.

     

    The
      selling shareholders may sell all or a portion of the shares of common stock
      beneficially owned by them and offered hereby from time to time directly or
      through one or more underwriters, broker-dealers or agents. If the shares of
      common stock are sold through underwriters or broker-dealers, the selling
      shareholders will be responsible for underwriting discounts or commissions
      or
      agent’s commissions. The shares of common stock may be sold in one or more
      transactions at fixed prices, at prevailing market prices at the time of the
      sale, at varying prices determined at the time of sale, or at negotiated prices.
      These sales may be effected in transactions, which may involve crosses or block
      transactions, 

     

    
      	
            	·	
              on
                any national securities exchange or quotation service on which the
                securities may be listed or quoted at the time of
                sale;

            

    

     

    
      	
            	·	
              in
                the over-the-counter market;

            

    

     

    
      	
            	·	
              in
                transactions otherwise than on these exchanges or systems or in the
                over-the-counter market;

            

    

     

    
      	
            	·	
              through
                the writing of options, whether such options are listed on an options
                exchange or otherwise;

            

    

     

    
      	
            	·	
              ordinary
                brokerage transactions and transactions in which the broker-dealer
                solicits purchasers;

            

    

     

    
      	
            	·	
              block
                trades in which the broker-dealer will attempt to sell the shares
                as agent
                but may position and resell a portion of the block as principal to
                facilitate the transaction;

            

    

     

    
      	
            	·	
              purchases
                by a broker-dealer as principal and resale by the broker-dealer for
                its
                account;

            

    

     

    
      	
            	·	
              an
                exchange distribution in accordance with the rules of the applicable
                exchange;

            

    

     

    
      	
            	·	
              privately
                negotiated transactions;

            

    

     

    
      	
            	·	
              short
                sales made after the date the Registration Statement is declared
                effective
                by the SEC, subject to any applicable limitations on short sales
                contained
                in any agreement between a selling shareholder and the
                Company;

            

    

     

    
      	
            	·	
              sales
                pursuant to Rule 144;

            

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
      	
            	·	
              broker-dealers
                may agree with the selling securityholders to sell a specified number
                of
                such shares at a stipulated price per
                share;

            

    

     

    
      	
            	·	
              a
                combination of any such methods of sale;
                and

            

    

     

    
      	
            	·	
              any
                other method permitted pursuant to applicable
                law.

            

    

     

    If
      the
      selling shareholders effect such transactions by selling shares of common stock
      to or through underwriters, broker-dealers or agents, such underwriters,
      broker-dealers or agents may receive commissions in the form of discounts,
      concessions or commissions from the selling shareholders or commissions from
      purchasers of the shares of common stock for whom they may act as agent or
      to
      whom they may sell as principal (which discounts, concessions or commissions
      as
      to particular underwriters, broker-dealers or agents may be in excess of those
      customary in the types of transactions involved). In connection with sales
      of
      the shares of common stock or otherwise, the selling shareholders may enter
      into
      hedging transactions with broker-dealers, which may in turn engage in short
      sales of the shares of common stock in the course of hedging in positions they
      assume. The selling shareholders may also sell shares of common stock short
      and
      deliver shares of common stock covered by this prospectus to close out short
      positions and to return borrowed shares in connection with such short sales.
      The
      selling shareholders may also loan or pledge shares of common stock to
      broker-dealers that in turn may sell such shares.

     

    The
      selling stockholders may pledge or grant a security interest in some or all
      of
      the warrants or shares of common stock owned by them and, if they default in
      the
      performance of their secured obligations, the pledgees or secured parties may
      offer and sell the shares of common stock from time to time pursuant to this
      prospectus or any amendment to this prospectus under Rule 424(b)(3) or other
      applicable provision of the Securities Act of 1933, as amended, amending, if
      necessary, the list of selling shareholders to include the pledgee, transferee
      or other successors in interest as selling stockholders under this prospectus.
      The selling shareholders also may transfer and donate the shares of common
      stock
      in other circumstances in which case the transferees, donees, pledgees or other
      successors in interest will be the selling beneficial owners for purposes of
      this prospectus.

     

    The
      selling shareholders and any broker-dealer participating in the distribution
      of
      the shares of common stock may be deemed to be “underwriters” within the meaning
      of the Securities Act, and any commission paid, or any discounts or concessions
      allowed to, any such broker-dealer may be deemed to be underwriting commissions
      or discounts under the Securities Act. At the time a particular offering of
      the
      shares of common stock is made, a prospectus supplement, if required, will
      be
      distributed which will set forth the aggregate amount of shares of common stock
      being offered and the terms of the offering, including the name or names of
      any
      broker-dealers or agents, any discounts, commissions and other terms
      constituting compensation from the selling shareholders and any discounts,
      commissions or concessions allowed or reallowed or paid to
      broker-dealers.

     

    Under
      the
      securities laws of some states, the shares of common stock may be sold in such
      states only through registered or licensed brokers or dealers. In addition,
      in
      some states the shares of common stock may not be sold unless such shares have
      been registered or qualified for sale in such state or an exemption from
      registration or qualification is available and is complied with.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    There
      can
      be no assurance that any selling shareholder will sell any or all of the shares
      of common stock registered pursuant to the shelf registration statement, of
      which this prospectus forms a part.

     

    The
      selling shareholders and any other person participating in such distribution
      will be subject to applicable provisions of the Securities Exchange Act of
      1934,
      as amended, and the rules and regulations thereunder, including, without
      limitation, to the extent applicable, Regulation M of the Exchange Act, which
      may limit the timing of purchases and sales of any of the shares of common
      stock
      by the selling shareholders and any other participating person. To the extent
      applicable, Regulation M may also restrict the ability of any person engaged
      in
      the distribution of the shares of common stock to engage in market-making
      activities with respect to the shares of common stock. All of the foregoing
      may
      affect the marketability of the shares of common stock and the ability of any
      person or entity to engage in market-making activities with respect to the
      shares of common stock.

     

    We
      will
      pay all expenses of the registration of the shares of common stock pursuant
      to
      the registration rights agreement, estimated to be
      $[     ] in total, including, without limitation,
      Securities and Exchange Commission filing fees and expenses of compliance with
      state securities or “blue sky” laws; provided,
      however,
      that a
      selling shareholder will pay all underwriting discounts and selling commissions,
      if any. We will indemnify the selling shareholders against liabilities,
      including some liabilities under the Securities Act, in accordance with the
      registration rights agreements, or the selling shareholders will be entitled
      to
      contribution. We may be indemnified by the selling shareholders against civil
      liabilities, including liabilities under the Securities Act, that may arise
      from
      any written information furnished to us by the selling shareholder specifically
      for use in this prospectus, in accordance with the related registration rights
      agreements, or we may be entitled to contribution.

     

    Once
      sold
      under the shelf registration statement, of which this prospectus forms a part,
      the shares of common stock will be freely tradable in the hands of persons
      other
      than our affiliates.ASSET
      PURCHASE AGREEMENT

    

    This
      ASSET PURCHASE AGREEMENT
      (this
“Agreement”),
      made
      as of the 12th day of December, 2006, is by and between AM Radio 790, Inc.,
      a
      Utah corporation (“Seller”) and KDWN License Limited Partnership, a Delaware
      limited partnership (“KDWN”), and Beasley FM Acquisition Corp., a Delaware
      corporation (“BFMA,” together, KDWN and BFMA are “Buyer”).

    

    RECITALS

    

    WHEREAS,
      Seller
      holds a construction permit (FCC File No. BNP-20011010ABN and an application
      for
      modification thereto, FCC File No. BMP-20061101AEG, together, the “Permit”)
      issued by the Federal Communications Commission (“FCC”)
      for
      radio broadcast station KBET(AM), 790 kHz, Winchester, Nevada, FCC Facility
      ID
      No. 136292 (the “Station”);
      and

    

    WHEREAS,
      Seller
      has filed an application with the FCC requesting a license to cover the Permit
      (FCC File No. BL-20060714ACX, the “License Application”) and has received
      program test authority (FCC File No. BPTA-20060711ADI) to operate the Station
      pending a grant of the License Application and the issuance of a license to
      cover the Permit (the “License”); and

    

    WHEREAS,
      Seller
      and Beasley Broadcasting of Nevada, LLC (“Beasley Nevada”), an affiliate of
      Buyer, have previously entered into an option agreement (the “Option
      Agreement”), dated as of August 22, 2005, pursuant to which Beasley Nevada paid
      Fifty Thousand Dollars ($50,000) to Seller for Beasley Nevada’s right to
      purchase the Station (the “Option Payment”); and

    

    WHEREAS,
      Seller
      desires to sell and assign and Buyer desires to acquire and assume all of the
      assets used or useful in connection with the operation of the Station, including
      but not limited to the License when issued, whether existing on the date hereof
      or acquired hereafter, on the terms and subject to the conditions set forth
      in
      this Agreement.

    

    

    NOW,
      THEREFORE,
      for
      good and valuable consideration, the parties agree as follows:

    

    ARTICLE
      1

    ASSETS
      TO BE CONVEYED

    

    1.1. Closing.
      Subject
      to Section 17.1 hereof and except as otherwise mutually agreed upon by Seller
      and Buyer, the closing of this transaction (the “Closing”)
      shall
      take place on a date agreed upon by Buyer and Seller within five (5) business
      days after all of the conditions specified in Sections 11.2 and 12.2 hereof
      have
      been fulfilled (or waived by the party entitled to waive such condition). The
      Closing shall be held at 10:00 a.m. local Washington D.C. time at the offices
      of
      Leventhal Senter & Lerman PLLC (“LS&L”),
      or at
      such other place and time as the parties may otherwise agree.

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    1.2. Station
      Assets.
      At the
      Closing, Seller shall sell, assign, transfer and convey to Buyer, and Buyer
      shall purchase from Seller, certain of the assets used in connection with the
      business and operation of the Station, including but not limited to the
      following assets:

    

    (a)
       Seller’s
      rights in and to the Permit and License, and all other authorizations issued
      to
      Seller by any governmental authority and used in the conduct of the business
      and
      operation of the Station, including those listed in Schedule
      1.2(a),
      together with any additions thereto (including renewals or modifications of
      such
      licenses, permits and authorizations and applications therefor) between the
      date
      hereof and the Closing Date and all of Seller’s rights in and to the call
      letters “KBET”;

    

    (b)
       Seller’s
      right and interest in and to the licensed real property used as the tower and
      transmitter sites of the Station, including the tower site License for the
      Station, and the real property listed in Schedule
      1.2(b),
      and any
      amendments thereto made between the date of execution of this Agreement and
      the
      Closing Date that Buyer expressly approves in writing to assume, including
      but
      not limited to any easements, rights of ingress and egress, and rights of way
      associated therewith, and the buildings, towers, and fixtures located thereon
      (the “Real Property”);

    

    (c)
       all
      equipment and supplies, inventory, spare parts, and other tangible personal
      property of every kind and description to be owned by Seller and used or useful
      in the conduct of the business and operation of the Station, including but
      not
      limited to that which is listed in Schedule
      1.2(c),
      together with any replacements thereof and additions made thereto (the “Personal
      Property”);

    

    (d)
       subject
      to the provisions of Article 3 hereof, all of Seller’s rights under and interest
      in the Contracts listed in Schedule
      1.2(d)
      hereto,
      together with all of Seller’s rights under and interest in all Contracts entered
      into or acquired by Seller between the date hereof and the Closing Date that
      Buyer expressly agrees in writing to assume (the “Assumed
      Contracts”);

    

    (e)
       all
      of
      Seller’s rights in and to any and all registered and unregistered trademarks,
      trade names, service marks, franchises, copyrights, including registrations
      and
      applications for registration of any of them, jingles, logos, slogans, licenses,
      patents, Internet domain names, Internet URLs, Internet web sites, content
      and
      databases, FCC authorizations and privileges, and other intangible property
      rights and interests applied for, issued to or owned by Seller for use in the
      conduct of the business and operation of the Station, including those listed
      in
Schedule
      1.2(e),
      and
      including the call letters “KBET,” together with any additions thereto between
      the date hereof and the Closing Date (the “Intellectual
      Property”);
      

    

    
      
         

      

      
        2

        
          

        

      

      
         

      

    

    (f)
       all
      files, records, books of account, and logs relating to the Station, including,
      without limitation, the Station’s public inspection files, filings with the FCC
      related to the Station, invoices, statements, technical information and
      engineering data relating to the Station, filings with the FCC and copies of
      all
      written Contracts to be assigned hereunder;

    

    (g)
       all
      rights under manufacturers’ and vendors’ warranties as exist at Closing and
      which relate to any of the Station Assets, as defined herein; and

    

    (h)
       all
      computer software and programs used or held for use in the operation of the
      Station.

    

    The
      assets to be transferred to Buyer hereunder are hereinafter collectively
      referred to as the “Station Assets.” The Station Assets shall be transferred to
      Buyer free and clear of any debts, Liens, or encumbrances of any kind or
      nature.

    

    1.3. Excluded
      Assets.
      The
      Station Assets shall not include the following (the “Excluded Assets”):
      

    

    (a)
       Seller’s
      books and records pertaining to the organization, existence or capitalization
      of
      Seller, and duplicate copies of such records as are necessary to enable Seller
      to file tax returns and reports;

    

    (b)
       any
      cash,
      cash equivalents, or similar type investments of Seller, such as certificates
      of
      deposit, treasury bills, and other marketable securities on hand and/or in
      banks; and

    

    (c)
       any
      insurance policies, except for any rights that may be assigned pursuant to
      Article 20 hereof.

    

    ARTICLE
      2

    PURCHASE
      PRICE

    

    2.1. Purchase
      Price.
      The
      total consideration to be paid by Buyer for the Station Assets shall be Two
      Million Five Hundred Thousand Dollars ($2,500,000), (the “Purchase
      Price”),
      subject to upward or downward adjustment, as the case may be, on and after
      the
      Closing Date, pursuant to Article 5. 

    

    2.2. Payment
      of Purchase Price. 

    

    (a)
       Beasley
      Nevada has previously paid to John Pierce & Co., LLC, as Escrow Agent,
      $200,000.00 (the “Escrow Deposit”). Upon the filing of the FCC Application, as
      defined below, Buyer shall pay to Seller an additional $500,000 by wire transfer
      of immediately available federal funds (the “First Additional Deposit”). The
      First Additional Deposit shall be used solely to repay debt owing by Seller
      to
      U.S. Capital, Inc., except as may be permitted by U.S. Capital. Schedule
      2.2
      hereto
      lists all of the current outstanding obligations of Seller to U.S. Capital,
      Inc.
      Upon the grant of the License, Buyer shall pay to Seller additional $500,000
      by
      wire transfer of immediately available federal funds (the “Second Additional
      Deposit”). The First Additional Deposit and the Second Additional Deposit shall
      be secured by a security interest senior to all other liens and claims in the
      Station Assets, except for the liens and claims of U.S. Capital, Inc., including
      but not limited to the proceeds from any sale thereof, including any sale of
      the
      Permit or the License, such security interest to be evidenced by a Security
      Agreement in the form of Exhibit
      A
      attached
      hereto and incorporated by reference. Prior to payment by Buyer of the First
      Additional Deposit, Seller shall execute and deliver to Buyer one or more UCC-1
      financing statements as may be necessary to perfect the security interests
      of
      Buyer in the collateral. 

    

    
      
         

      

      
        3

        
          

        

      

      
         

      

    

    (b)
       At
      the
      Closing, the parties shall jointly instruct the Escrow Agent to pay the Escrow
      Deposit to Seller, and the interest accrued thereon to Buyer. Buyer shall
      receive a credit towards payment of the Purchase Price in the amount of the
      Escrow Deposit paid to Seller. In addition, at the Closing, Buyer shall receive
      a credit towards payment of the Purchase Price in the amount of the $50,000
      Option Payment paid by Beasley Nevada to Seller, the First Additional Deposit,
      and the Second Additional Deposit. 

    

    (c) Beasley
      Nevada has provided a loan of $190,000 to Paragon Communications and
      Advertising, Inc. (“Paragon”)
      as
      evidenced by a Promissory Note dated May 11, 2006. At the Closing, Buyer shall
      cause Beasley Nevada to cancel the Promissory Note, and to release Paragon
      from
      its indebtedness under the Promissory Note, and Buyer shall be credited
      $190,000, plus all interest accrued on the Promissory Note, towards payment
      of
      the Purchase Price.

    

    (d)
       At
      the
      Closing, Buyer shall pay to Seller, or as Seller otherwise designates in
      writing, the balance of the Purchase Price by wire transfer of immediately
      available funds pursuant to wire transfer instructions provided by
      Seller.

    

    ARTICLE
      3

    ASSUMPTION
      OF OBLIGATIONS

    

    3.1. Assumption
      of Obligations.
      Subject
      to the provisions of this Article 3 and of Article 5 of this Agreement, at
      the
      Closing Buyer shall assume and undertake to pay, satisfy or discharge the
      liabilities, obligations and commitments of Seller under the Station Assets
      to
      the extent that either (i) the obligations and liabilities relate to the period
      after the Effective Time and arise out of events related to Buyer’s ownership of
      the Station Assets or Buyer’s operation of the Station on or after the Effective
      Time or (ii) the Purchase Price was reduced pursuant to Article 5 as a result
      of
      the proration or adjustment of such obligations and liabilities.

    

    
      
         

      

      
        4

        
          

        

      

      
         

      

    

    3.2. Limitation.
      Except
      as set forth in Section 3.1 hereof, Buyer expressly does not, and shall not,
      assume or be deemed to assume, under this Agreement or otherwise by reason
      of
      the transactions contemplated hereby, any liabilities, obligations or
      commitments of Seller of any nature whatsoever and Seller shall at all times
      indemnify and hold Buyer harmless from and against any claim or liability
      arising therefrom. Seller shall discharge all liabilities in a timely manner
      as
      they become due and payable. Any liabilities that exist or may arise that create
      any Liens of any kind against any of the Station Assets shall be fully paid
      by
      Seller prior to or at Closing and Seller shall cause the Station Assets to
      be
      fully released from all such claims.

    

    ARTICLE
      4

    REQUIRED
      CONSENTS

    

    4.1. FCC
      Application.
      The
      assignment of the License as contemplated by this Agreement is subject to the
      prior consent and approval of the FCC. No later than two (2) business days
      after
      the date that the parties execute this Agreement, Buyer and Seller shall file
      the FCC Application. Seller and Buyer shall thereafter prosecute the FCC
      Application with all reasonable diligence and otherwise use their best efforts
      to obtain the grant of the FCC Application as expeditiously as practicable.
      If
      reconsideration or judicial review is sought with respect to the FCC Consent,
      the party affected shall vigorously oppose such efforts for reconsideration
      or
      judicial review; provided, however, that nothing herein shall be construed
      to
      limit either party’s right to terminate this Agreement pursuant to Article 17
      hereof.

    

    4.2. Other
      Governmental Consents.
      Promptly after the date of this Agreement, the parties shall prepare and file
      with the appropriate governmental authorities any other requests for approval
      or
      waiver that are required from such governmental authorities in connection with
      the transactions contemplated hereby, and shall diligently and expeditiously
      prosecute, and shall cooperate fully with each other in the prosecution of,
      such
      requests for approval or waiver and all proceedings necessary to secure such
      approvals and waivers.

     

    ARTICLE
      5

    PRORATIONS
      AND ALLOCATION

    

    5.1. Proration
      of Expenses.
      All
      revenues and expenses arising from the conduct of the business and operation
      of
      the Station, including expenses under the Assumed Contracts, and similar prepaid
      and deferred items, shall be prorated between Buyer and Seller as of the
      Effective Time. Such prorations shall be based upon the principle that Seller
      shall be responsible for all liabilities and obligations incurred or accruing
      in
      connection with the operation of the Station until the Effective Time, and
      Buyer
      shall be responsible for such liabilities and obligations incurred by Buyer
      thereafter. Such prorations shall include, without limitation, all ad valorem,
      real estate and other property taxes, business and license fees, FCC regulatory
      fees, utility expenses, liabilities and obligations under the Assumed Contracts,
      rents and similar prepaid and deferred items, except taxes arising by reason
      of
      the transfer of the Station Assets as contemplated hereby, which shall be paid
      in accordance with Section 14.2. To the extent not known, real estate taxes
      shall be apportioned on the basis of taxes assessed for the preceding year,
      with
      a reapportionment as soon as the new tax rate and valuation can be ascertained.
      Notwithstanding the foregoing, there shall be no adjustment for, and Seller
      shall remain solely liable with respect to any obligations or liabilities not
      being assumed by Buyer in accordance with Article 3 hereof.

    

    
      
         

      

      
        5

        
          

        

      

      
         

      

    

    5.2. Payment
      of Proration Items.
      Three
      (3) business days prior to Closing, Seller shall deliver to Buyer a preliminary
      list of all items to be prorated pursuant to Section 5.1 (the “Preliminary
      Proration Schedule”),
      and,
      to the extent feasible, such prorations shall be credited against or added
      to
      the Purchase Price at Closing. In the event Buyer and Seller do not reach a
      final agreement on such prorations and adjustments at Closing, Seller shall
      deliver to Buyer a schedule of its proposed prorations and adjustments (the
      “Proration
      Schedule”)
      no
      later than forty-five (45) days after the Closing Date. The Proration Schedule
      shall be conclusive and binding upon Buyer unless Buyer provides Seller with
      written notice of objection (the “Notice
      of Disagreement”)
      within
      ten (10) business days after Buyer’s receipt of the Proration Schedule, which
      notice shall state the prorations of expenses proposed by Buyer (the
“Buyer’s
      Proration Amount”).
      Seller
      shall have ten (10) business days from receipt of a Notice of Disagreement
      to
      accept or reject Buyer’s Proration Amount. If Seller rejects Buyer’s Proration
      Amount, and the amount in dispute exceeds $5,000, the dispute shall be submitted
      within ten (10) days to an accounting firm, mutually agreeable to the parties,
      that is unaffiliated with either party (the “Referee”)
      for
      resolution, such resolution to be made within twenty (20) days after submission
      to the Referee and to be final, conclusive and binding on Seller and Buyer.
      Buyer and Seller agree to share equally the cost and expenses of the Referee,
      but each party shall bear its own legal and other expenses, if any. If the
      amount in dispute is equal to or less than $5,000, such amount shall be divided
      equally between Buyer and Seller. Payment by Buyer or Seller, as the case may
      be, of the proration amounts determined pursuant to this Section 5.2 shall
      be
      due five (5) business days after the last to occur of (i) Buyer’s acceptance of
      the Proration Schedule or Buyer’s failure to give Seller a timely Notice of
      Disagreement; (ii) Seller’s acceptance of Buyer’s Proration Amount or failure to
      reject Buyer’s Proration Amount within ten (10) days after receipt of a Notice
      of Disagreement; (iii) Seller’s rejection of Buyer’s Proration Amount in the
      event the amount in dispute equals or is less than $5,000; and (iv) notice
      to
      Seller and Buyer of the resolution of the disputed amount by the Referee in
      the
      event that the amount in dispute exceeds $5,000. Any payment required by Seller
      to Buyer or by Buyer to Seller, as the case may be, under this Section 5.2
      shall
      be paid by check or wire transfer of immediately available federal funds to
      the
      account of the payee with a financial institution in the United States as
      designated by Seller in the Proration Schedule or by Buyer in the Notice of
      Disagreement (or by separate notice in the event that Buyer does not send a
      Notice of Disagreement). If either Buyer or Seller fails to pay when due any
      amount under this Section 5.2, interest on such amount will accrue from the
      date
      payment was due to the date such payment is made at a per annum rate equal
      to
      the Prime Rate plus
      two
      percent (2%), and such interest shall be payable upon demand.

    

    5.3. Allocation.
      Buyer
      and Seller shall use reasonable efforts to agree to an allocation of the
      Purchase Price pursuant to the requirements of Section 1060 of the Internal
      Revenue Code of 1986 within 30 days after the Closing Date. The parties also
      agree to use such Purchase Price allocation in completing and filing Internal
      Revenue Code Form 8594 for federal income tax purposes.

     

    
      
         

      

      
        6

        
          

        

      

      
         

      

    

    ARTICLE
      6

    REPRESENTATIONS
      AND WARRANTIES OF BUYER

    

    Buyer
      represents and warrants to Seller as follows:

    

    6.1. Organization
      and Standing.
      KWDN is
      a limited liability company___ organized, validly existing and in good standing
      under the laws of the State of Delaware and is qualified, or as of the Closing
      will be qualified, to do business in the State of Nevada. BFMA is a corporation
      organized, validly existing and in good standing under the laws of the State
      of
      Delaware and is qualified, or as of the Closing will be qualified, to do
      business in the State of Nevada.

    

    6.2. Authorization
      and Binding Obligation.
      Buyer
      each have all necessary power and authority to enter into and perform under
      this
      Agreement and the transactions contemplated hereby, and Buyer’s execution,
      delivery and performance of this Agreement has been duly and validly authorized
      by all necessary action on its part. This Agreement has been duly executed
      and
      delivered by Buyer and constitutes its valid and binding obligation, enforceable
      in accordance with its terms, except as limited by laws affecting creditors’
rights or equitable principles generally.

    

    6.3. Absence
      of Conflicting Agreements or Required Consents.
      Except
      as set forth in Article 4 with respect to FCC and other governmental consents,
      the execution, delivery and performance of this Agreement and the consummation
      of the transactions contemplated hereby by Buyer: (a) do and will not require
      the consent of any third party; (b) do and will not violate any provisions
      of
      Buyer’s organizational documents; (c) do and will not violate any applicable
      law, judgment, order, injunction, decree, rule, regulation or ruling of any
      governmental authority to which Buyer is a party; and (d) do and will not,
      either alone or with the giving of notice or the passage of time, or both,
      conflict with, constitute grounds for termination of or result in a breach
      of
      the terms, conditions or provisions of, or constitute a default under any
      agreement, instrument, license or FCC authorization to which Buyer is now
      subject.

    

    6.4. Absence
      of Litigation.
      There
      is no claim, litigation, proceeding or investigation pending or, to the best
      of
      Buyer’s knowledge, threatened against Buyer which seeks to enjoin or prohibit,
      or which otherwise questions the validity of, any action taken or to be taken
      in
      connection with this Agreement.

    

    6.5. Bankruptcy.
      No
      insolvency proceedings of any character, including without limitation,
      bankruptcy, receivership, reorganization, composition or arrangement with
      creditors, voluntary or involuntary, affecting Buyer, are pending or, to the
      best of Buyer’s knowledge, threatened, and Buyer has not made any assignment for
      the benefit of creditors or taken any action which would constitute the basis
      for the institution of such insolvency proceedings.

     

    
      
         

      

      
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    ARTICLE
      7

    REPRESENTATIONS
      AND WARRANTIES OF SELLER

    

    Seller
      represents and warrants to Buyer as follows:

    

    7.1. Organization
      and Standing.
      Seller
      is a corporation duly formed, validly existing and in good standing under the
      laws of the State of Utah, and has all necessary power and authority to own,
      lease and operate the Station Assets between the date hereof and the Closing
      Date.

    

    7.2. Authorization
      and Binding Obligation.
      Seller
      has all necessary power and authority to enter into and perform this Agreement
      and the transactions contemplated hereby, and Seller’s execution, delivery and
      performance of this Agreement has been duly and validly authorized by all
      necessary action on its part. This Agreement has been duly executed and
      delivered by Seller and constitutes its valid and binding obligation,
      enforceable in accordance with its terms, except as limited by laws affecting
      the enforcement of creditors’ rights or equitable principles
      generally.

    

    7.3. Absence
      of Conflicting Agreements or Required Consents.
      Except
      as set forth in Article 4 with respect to FCC and other governmental consents
      and/or as disclosed on Schedule
      1.2(d),
      the
      execution, delivery and performance of this Agreement and the consummation
      of
      the transactions contemplated hereby by Seller (a) do not and will not require
      the consent of any third party; (b) do not and will not violate any provisions
      of Seller’s organizational documents; (c) do not and will not violate any
      applicable law, judgment, order, injunction, decree, rule, regulation or ruling
      of any governmental authority to which Seller is a party or by which it or
      the
      Station Assets are bound; (d) do not and will not, either alone or with the
      giving of notice or the passage of time, or both, conflict with, constitute
      grounds for termination of or result in a breach of the terms, conditions or
      provisions of, or constitute a default under any lease, contract, agreement,
      instrument, license or permit to which either Seller or the Station Assets
      are
      now subject; and (e) do not and will not result in the creation of any lien,
      charge or encumbrance on any of the Station Assets.

    

    7.4. FCC
      Authorizations.
      

    

    (a)
       Schedule
      1.2(a)
      contains
      a true and complete list of the licenses and permits issued in connection with
      the Station, including their expiration dates. Seller has delivered to Buyer
      true and complete copies of such licenses and permits. The licenses, permits
      and
      authorizations listed in Schedule
      1.2(a)
      are
      validly held (or when issued, will be validly held) by Seller, and are in full
      force and effect. There are no applications pending before the FCC relating
      to
      the Station, except as listed on Schedule
      1.2(a).
      

    

    
      
         

      

      
        8

        
          

        

      

      
         

      

    

    (b)
       There
      are
      no applications, complaints or proceedings pending or, to the best of Seller’s
      knowledge, threatened before the FCC that may result in the revocation,
      materially adverse modification, or suspension of the FCC authorizations
      associated with the Station, or the imposition of any fines, forfeitures, or
      other administrative actions with respect to the Station other than proceedings
      affecting the broadcasting industry generally.

    

    (c)
       There
      are
      no facts which, under the Communications Act of 1934, as amended, or the
      existing rules and regulations of the FCC, would disqualify Seller as the
      assignor of the License, when issued.

     

    7.5. Title
      to and Condition of Real Property.

    

    (a)
       Schedule
      1.2(b)
      contains
      descriptions of all of Seller’s interests, including licensed interests,
      easements and rights in and agreements with respect to the Real Property. The
      Real Property and the use thereof by Seller comply in all respects with all
      applicable laws, statutes, ordinances, rules and regulations of federal, state
      and local governmental authorities, including, without limitation, those
      relating to zoning. All improvements upon the Real Property and the present
      use
      thereof at Closing comply or conform in all material respects with all deed
      restrictions, restrictive covenants, building codes, and federal, state and
      local laws, regulations and ordinances, and no permits, licenses or certificates
      pertaining to ownership or operation of the Real Property, other than those
      that
      are transferable with the Real Property, are required by any federal, state
      or
      local government, agency, board or other governmental authority having
      jurisdiction over the Real Property. All improvements are in good working
      condition and repair, insurable at standard rates, and in compliance with the
      rules and regulations of the FCC, the Federal Aviation Administration and all
      other applicable federal, state and local statutes, ordinances, rules and
      regulations. There are no structural, electrical, mechanical, plumbing, air
      conditioning, heating or other defects in the improvements on the Real Property.
      All towers located upon the Real Property are structurally sound, comply with
      current wind-loading requirements and not be in need of repair or maintenance.
      There are no modifications or improvements to the Real Property required to
      bring it into compliance with any law, notwithstanding that Seller’s current
      operations on the Real Property may be grandfathered or otherwise subject to
      an
      exception, exemption or waiver. Seller has paid, or shall at or prior to Closing
      will pay, all amounts owed to any contractor, architect or subcontractor for
      labor or materials performed, rendered or supplied in connection with the Real
      Property; and all contributions required to have been paid by a landlord or
      Seller in connection with the construction of, or modification to, any licensed
      Real Property have been or will be paid at or prior to Closing.

    

    (b)
       Seller
      has not received any notice of any appropriation, eminent domain proceeding,
      condemnation or like proceeding, or of any violation of any applicable zoning
      law, regulation or other law, order, regulation or requirement affecting the
      Real Property or the improvements thereon, or of the need for any material
      repair, remedy, construction, alteration or installation with respect to the
      Real Property or improvements thereon, or any material change in the means
      or
      methods of conducting operations thereon.

    

    
      
         

      

      
        9

        
          

        

      

      
         

      

    

    (c)
       Seller
      has valid and subsisting licensed interests, insurable at standard rates, to
      the
      Real Property, free and clear of all Liens, of any nature whatsoever, and
      without any reservation or exclusion of any mineral, timber, or other rights
      or
      interests, except for liens disclosed on Schedule
      1.2(b).

    

    (d)
       All
      towers, guy anchors, and buildings and other improvements included in the
      Station Assets shall be located entirely on the Real Property.

    

    (e)
       Seller
      has delivered to Buyer true and complete copies of all deeds, Licenses and
      easements held by Seller pertaining to the Real Property and copies of all
      title
      policies and surveys in its possession pertaining to the Real Property. The
      Real
      Property, including the improvements thereon (i) are in good condition and
      repair, and (ii) are available for immediate use in the conduct of the business
      and operations of the Station.

    

    (f)
       Seller
      has full legal and practical access to the Real Property, including to the
      towers located upon the Real Property, and all easements, rights-of-way, and
      real property licenses included in the Real Property shall have been properly
      recorded in the appropriate public recording offices. 

    

    7.6. Title
      to and Condition of Personal Property.
      Seller
      is the sole owner of the Personal Property and has good and marketable title
      to
      all Personal Property free and clear of all Liens. Seller possesses full right
      to sell or dispose of the Personal Property as Seller may choose. Following
      Closing, no other person or entity will have any claim, right, title, or
      interest in, or Lien against, the Personal Property. All of the items of
      tangible personal property and facilities included in the Station Assets are
      in
      good operating condition and repair (reasonable wear and tear excepted), are
      be
      insurable at standard rates, have been properly maintained in accordance with
      industry standards, are performing satisfactorily and in accordance with
      standards of good engineering practice, comply in all respects with applicable
      rules and regulations of the FCC, the terms of the Permit (and, when issued,
      the
      License), and with other applicable federal, state and local statutes,
      ordinances, rules and regulations, and are be available for immediate use in
      the
      operation of the Station. Seller has no knowledge of any defect in the condition
      or operation of any item of Personal Property which is reasonably likely to
      have
      a material adverse effect on the operations of the Station. All items of
      transmitting and studio equipment included in the Personal Property will permit
      the Station to operate in accordance with the terms of the Permit and, when
      issued, the License, and the rules and regulations of the FCC, and with all
      other applicable federal, state and local statutes, ordinances, rules and
      regulations.

    

    7.7. Contracts.
      Seller
      has delivered to Buyer true and complete copies of all written Assumed Contracts
      and true and complete memoranda of all oral Assumed Contracts, including any
      amendments and other modifications to such Assumed Contracts. The Assumed
      Contracts constitute valid and binding obligations of Seller and, to the best
      of
      Seller’s knowledge, of all other parties thereto, and are in full force and
      effect as of the date hereof. Seller is not in default under any of the Assumed
      Contracts and, to the best of Seller’s knowledge, the other parties to such
      Assumed Contracts are not in default thereunder. Seller has not received or
      given written notice of any default thereunder from or to any of the other
      parties thereto. Except as disclosed on Schedule
      1.2(d),
      at
      Closing Seller has all requisite power and authority to assign its rights under
      the Assumed Contracts to Buyer in accordance with this Agreement on terms and
      conditions no less favorable than those in effect on the date hereof, and such
      assignment will not affect the validity, enforceability or continuity of any
      such Assumed Contracts.

    

    
      
         

      

      
        10

        
          

        

      

      
         

      

    

    7.8. Intellectual
      Property.
      Schedule
      1.2(e)
      lists
      all Intellectual Property applied for, issued to or owned by Seller for use
      in
      the operation of the Station, or under which Seller is licensed or franchised
      to
      be assigned hereunder, all of which rights and interests are issued to or owned
      by Seller, or if licensed or franchised to Seller, are valid and uncontested.
      Seller has delivered to Buyer copies of all documents, if any, establishing
      such
      rights, licenses or other authority. There is no pending or, to the best of
      Seller’s knowledge, threatened proceeding or litigation affecting or with
      respect to the Intellectual Property. Seller is not infringing upon or otherwise
      acting adversely to any trademarks, trade names, service marks, service names,
      copyrights, patents, patent applications, internet domain names, know-how,
      methods, or processes owned by any other person or persons, and there is no
      claim or action pending, or to the knowledge of Seller threatened, with respect
      thereto. The Intellectual Property listed on Schedule
      1.2(e)
      comprises all material intangible property interests used or held for use in
      connection with the Station.

    

    7.9. Taxes.
      Seller
      has duly, timely and in the required manner filed all federal, state, local
      and
      foreign income, franchise, sales, use, property, excise, and other tax returns
      and forms required to be filed, and has paid in full or discharged all taxes,
      assessments, excises, interest, penalties, deficiencies and losses required
      to
      be paid. As of the time of filing, such returns were true, complete and correct
      in all material respects. There are no governmental investigations or other
      legal, administrative, or tax proceedings pending, or to the best of Seller’s
      knowledge, threatened pursuant to which Seller is or could be made liable for
      any taxes, penalties, interest, or other charges, the liability for which could
      extend to Buyer as transferee of the Station, or could result in a Lien on
      any
      of the Station Assets, and no event has occurred that could impose on Buyer
      any
      transferee liability for any taxes, penalties, or interest due or to become
      due
      from Seller.

    

    7.10. Bankruptcy.
      No
      insolvency proceedings of any character, including without limitation,
      bankruptcy, receivership, reorganization, composition or arrangement with
      creditors, voluntary or involuntary, affecting Seller or any of the Station
      Assets, are pending or, to the best of Seller’s knowledge, threatened, and
      Seller has not made any assignment for the benefit of creditors or taken any
      action which would constitute the basis for the institution of such insolvency
      proceedings.

    

    7.11. Environmental
      Matters.
      (a)
      There has been no release, nor is there a threat of a release, of any Hazardous
      Substance or Hazardous Waste at or from the Real Property by Seller; (b) to
      the
      best of Seller’s knowledge, there are no Hazardous Substances or Hazardous
      Wastes present on the Real Property except for ordinary quantities of properly
      stored Hazardous Substances or Hazardous Wastes found in consumer or commercial
      products that are used in the normal course of broadcast station operations,
      including grounds and building operation and maintenance; (c) to the best of
      Seller’s knowledge, there are no aboveground or underground storage tanks,
      whether in use or closed, on or under the Real Property; and (d) to the best
      of
      Seller’s knowledge, neither the Real Property, equipment or installations on the
      Real Property nor any Personal Property contain PCBs or asbestos in quantities
      sufficient to mandate the labeling or removal of such PCBs or asbestos in
      accordance with federal, state or local government environmental standards
      or to
      warrant the imposition of any penalty, civil or criminal, against Seller. The
      terms “Hazardous
      Substance”
and
      “Hazardous
      Waste”
shall
      have the meanings set forth in the Resource Conservation and Recovery Act,
      as
      amended from time to time, the Comprehensive Environmental Response,
      Compensation and Liability Act of 1980, as amended from time to time, any other
      applicable Environmental Law, and the regulations promulgated under all such
      laws. Seller has obtained all environmental, health and safety permits necessary
      for the operation of the Station, all such permits are in full force and effect,
      and the Seller is in compliance with the terms and conditions of all such
      permits. Seller has not received any notice, nor does Seller have any knowledge
      of any administrative or judicial investigations, proceedings or actions with
      respect to violations, alleged, or proved, of any Environmental Law involving
      Station operations or the Real Property.

    

    
      
         

      

      
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    7.12. UCC
      Financing Statements.
      All of
      the Station Assets have been located in the State of Nevada following their
      acquisition by Seller and except as listed in Schedule
      7.12, no
      party
      has filed a deed of trust, mortgage or UCC financing statement with respect
      to
      the Station Assets.

    

    7.13 Insurance.
      The
      Station Assets are insured against loss, damage, or injury in amounts customary
      in the broadcast industry.

    

    7.14 Compliance
      With Laws.
      Seller
      is in compliance with all laws, regulations and governmental orders applicable
      to the construction and operation of the Station. Seller is not in default
      or in
      violation of any law, regulation, court order, or order of any federal, state,
      municipal, foreign or other government department, board, bureau, agency, or
      instrumentality, wherever located, that would materially adversely affect
      construction or operation of the Station, Station Assets, the Permit or, when
      issued, the License, including but not limited to state and federal
      environmental laws and regulations. There is no pending or threatened
      investigation, audit, review or other examination of the Station, Station
      Assets, the Permit or, when issued, the License and Seller is not subject to
      any
      order, agreement, memorandum of understanding or other regulatory enforcement
      action or proceeding with or by the FCC or any other federal or state
      governmental agency having supervisory or regulatory authority with respect
      to
      the Station, Station Assets, the Permit or, when issued, the License, nor is
      Seller aware of any basis for any such investigation or audit.

     

    
      
         

      

      
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    ARTICLE
      8

    COVENANTS
      OF BUYER

    

    8.1. Notification.
      Buyer
      shall notify Seller of any litigation, arbitration or administrative proceeding
      pending or threatened against Buyer which challenges the transactions
      contemplated hereby, including any challenges to the FCC Application, and shall
      use reasonable efforts to remove any such impediment to the transactions
      contemplated by this Agreement.

    

    8.2. No
      Inconsistent Action.
      Buyer
      shall not take any action materially inconsistent with its obligations under
      this Agreement or that would hinder or delay the consummation of the
      transactions contemplated by this Agreement.

    

    ARTICLE
      9

    COVENANTS
      OF SELLER

    

    9.1. Interim
      Operation.
      Between
      the date of this Agreement and the Closing Date, except with the prior written
      consent of Buyer:

    

    (a)
       Seller
      shall not sell, assign, lease or otherwise transfer or dispose of any of the
      Station Assets, except where replaced by a like asset;

    

    (b)
       Seller
      shall not create, assume or permit to exist any mortgage, Lien, pledge, or
      encumbrance of any nature whatsoever upon the Station Assets;

    

    (c)
       Seller
      shall operate the Station in compliance with the FCC’s rules and regulations,
      the Permit, and when issued, the License, and with all other applicable laws,
      regulations, rules and orders, including without limitation by performing all
      tests and measurements required in connection with the construction of the
      Station;

    

    (d)
       Seller
      shall comply in all respects with the Assumed Contracts, and shall not, without
      the express written consent of Buyer, modify, amend, cancel or terminate any
      of
      the Assumed Contracts;

    

    (e)
       Seller
      shall promptly notify Buyer of any default by, or claim of default against,
      any
      party under any of the Assumed Contracts, and any event or condition which,
      with
      notice or lapse of time or both, would constitute an event of default under
      such;

    

    (f)
       Seller
      shall maintain insurance policies on the Station Assets as is customary in
      the
      broadcast industry; and

    

    (g)
       Seller
      shall maintain the Station Assets in good operating condition; repair or replace
      all items of Personal Property at time intervals consistent with prior practice;
      maintain adequate supplies of spare parts consistent with past practices; and
      repair or replace (subject to Article 20) any Station Asset that may be damaged
      or destroyed with items of equal or greater value and utility.

    

    
      
         

      

      
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    9.2.
       Access
      to Station.
      Between
      the date of this Agreement and the Closing Date, Seller shall give Buyer and
      Buyer’s counsel, accountants, engineers and other representatives, reasonable
      access during normal business hours to all of Seller’s properties, records and
      employees relating to the Station, and shall furnish Buyer with all information
      related to the Station that Buyer reasonably requests. The rights of Buyer
      under
      this Section 9.2 shall not be exercised in such a manner as to interfere
      unreasonably with or disrupt the business or operation of the
      Station.

    

    9.3. Notification.
      If
      Seller receives notice thereof or otherwise becomes aware of same, Seller shall
      notify Buyer of any litigation, arbitration or administrative proceeding pending
      or threatened against Seller which challenges the transactions contemplated
      hereby, including any challenges to the FCC Application, and shall use its
      reasonable efforts to take such steps as may be necessary to remove any such
      impediment to the transactions contemplated by this Agreement.

    

    9.4. Third-Party
      Consents.
      Seller
      shall use its best efforts to obtain the consent of any third party necessary
      for the assignment to Buyer of any Assumed Contract to be assigned
      hereunder.

    

    9.5. Closing
      Covenant.
      On the
      Closing Date, Seller shall transfer, convey, assign and deliver to Buyer the
      Station Assets as provided in Article 1 of this Agreement.

    

    9.6. No
      Inconsistent Action.
      Seller
      shall not take any action which is materially inconsistent with its obligations
      under this Agreement or that would hinder or delay the consummation of the
      transactions contemplated by this Agreement.

    

    9.7 Non-Solicitation.
      Seller
      shall not offer or solicit offers, or entertain or discuss any offer, to sell
      the Station or any of the Station Assets, including but not limited to the
      Permit and the License, when issued, nor shall it permit its principals, brokers
      or other representatives to offer, to solicit offers, or entertain or discuss
      any offer to sell, any interest in the Station or any of the Station Assets,
      including but not limited to the Permit and the License, when issued, to third
      parties unless Buyer has expressly consented thereto in writing.

    

    ARTICLE
      10

    JOINT
      COVENANTS

    

    10.1. Conditions.
      If any
      event should occur between the date hereof and the Closing, either within or
      without the control of any party hereto, which would prevent fulfillment of
      the
      conditions upon the obligations of any party to consummate the transactions
      contemplated by this Agreement, the parties shall use their reasonable efforts
      to cure the event as expeditiously as possible.

    

    
      
         

      

      
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    10.2. Commercially
      Reasonable Efforts.
      Between
      the date of this Agreement and the Closing, each party shall use commercially
      reasonable efforts to cause the fulfillment at the earliest practicable date
      of
      all of the conditions to the obligations of the other party to consummate the
      sale and purchase under this Agreement.

    

    10.3. Control
      of Station.
      Between
      the date of this Agreement and the Closing, Buyer shall not, directly or
      indirectly, control, supervise or direct the operations of the Station. Such
      operations shall be the sole responsibility of Seller.

    

    10.4. Confidentiality.
      Buyer
      and Seller shall each keep confidential all information obtained by it with
      respect to the other in connection with this Agreement, and if the transactions
      contemplated hereby are not consummated for any reason, each shall return to
      the
      other, without retaining a copy thereof, any schedules, documents or other
      written information, including all financial information, obtained from the
      other in connection with this Agreement and the transactions contemplated
      hereby, except where such information is known or available through other lawful
      sources or where such party is advised by counsel that its disclosure is
      required in accordance with applicable law.

    

    10.5. Access
      to Records.
      For a
      period of two (2) years from the Closing Date, each party to this Agreement
      shall provide to the other party access during normal business hours to such
      financial records as may be necessary for either party to prepare any required
      tax filings.

    

    10.6 Environmental
      Studies.
      Buyer
      may obtain, within forty-five (45) calendar days after the execution of this
      Agreement, a completed Phase I environmental audit report (the “Phase
      I Report”)
      regarding the Real Property. The cost of the Phase I Report shall be paid by
      Buyer. The Phase I Report shall be reasonably satisfactory to Buyer in all
      respects, and Buyer agrees to notify Seller of any objection to the status
      of
      the Phase I Report within ten (10) business days after Buyer’s receipt of the
      Phase I Report. To the extent Buyer does not notify Seller within such ten
      (10)
      day period of any objection to the Phase I Report, Buyer hereby waives any
      right
      to refuse to consummate this Agreement or to terminate this Agreement as a
      result of any noncompliance with Environmental Laws disclosed in the Phase
      I
      Report. If, in Buyer’s reasonable judgment, a Phase II environmental audit
      report (“Phase
      II Report”)
      is
      necessary in light of the contents of the Phase I Report and Buyer has timely
      objected to the applicable Phase I Report, Buyer shall obtain such Phase II
      Report within thirty (30) calendar days following Buyer’s objection to the Phase
      I Report, at Buyer’s sole expense, which shall be satisfactory to Buyer in all
      respects. In the event that a Phase I Report and/or a Phase II report discloses
      an environmental condition or matter which is reasonably unsatisfactory to
      Buyer
      and to which Buyer objects on a timely basis, Seller shall have sixty (60)
      calendar days from Seller’s receipt of notice to remediate and eliminate such
      condition or matter and bring such Real Property into compliance with all
      Environmental Laws. If the environmental condition or matter is not remediated
      and eliminated by Seller within the prescribed 60 day period, Buyer may
      terminate this Agreement, without any further liability hereunder. 

    

    
      
         

      

      
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    10.7. Title
      Insurance and Surveys.
       Within
      thirty (30) after the execution of this Agreement, at Buyer’s option, Buyer may
      obtain at Buyer’s expense: (a) a commitment for an ALTA title insurance policy
      related to the Real Property reasonably acceptable to Buyer (the “Title”);
      or
      (b) a staked-on-ground boundary survey of the Real Property reasonably
      acceptable to Buyer, certified current as of the date of delivery thereof,
      prepared by a duly licensed and registered land surveyor acceptable to Buyer
      (the “Survey”).
      The
      Title and the Survey will be ordered by the Buyer, and shall in all respects
      be
      reasonably acceptable to Buyer. Buyer agrees to notify Seller of any objection
      to the status of the Title and/or Survey within ten (10) business days after
      Buyer’s receipt of the Title and Survey. In the event that the Title and/or
      Survey are reasonably unsatisfactory to Buyer and Buyer has timely objected
      thereto, Seller shall have sixty (60) calendar days from Seller’s receipt of
      notice to eliminate such condition or matter. If the condition or matter is
      not
      eliminated by Seller within the prescribed 60 day period, Buyer may terminate
      this Agreement, without any further liability hereunder. 

     

    ARTICLE
      11

    CONDITIONS
      PRECEDENT TO BUYER’S OBLIGATION TO CLOSE

    

    The
      obligations of Buyer hereunder are, at its option, subject to satisfaction,
      at
      or prior to the Closing Date, of each of the following conditions: 

    

    11.1. Representations,
      Warranties and Covenants.

    

    (a)
       All
      representations and warranties of Seller made in this Agreement shall be true
      and complete in all material respects on and as of the Closing Date as if made
      on and as of that date.

    

    (b)
       All
      of
      the terms, covenants and conditions to be complied with and performed by Seller
      on or prior to Closing Date shall have been complied with or performed in all
      material respects.

    

    11.2. Governmental
      Consents.
      The
      conditions specified in Article 4 of this Agreement shall have been satisfied,
      and the FCC Consent shall have been granted and become a Final Order, provided
      that Buyer may waive the requirement that the FCC Consent shall have become
      a
      Final Order. If the Closing occurs before the FCC Consent has become a Final
      Order, the parties will, at Buyer’s option, enter into a mutually acceptable
      unwind agreement. Buyer shall have received any necessary governmental
      approvals. 

    

    11.3. Governmental
      Authorizations.
      Seller
      shall be the lawful holder of the License and all other material licenses,
      permits and other authorizations listed in Schedule
      1.2(a),
      and
      there shall not have been any modification of any of such licenses, permits
      and
      other authorizations which would have a material adverse effect on the
      operations of the Station. No proceeding shall be pending which seeks or the
      effect of which reasonably could be to revoke, cancel, fail to renew, suspend
      or
      modify adversely any of the permits or any other material licenses, permits
      or
      other authorizations relating to the Station.

    

    
      
         

      

      
        16

        
          

        

      

      
         

      

    

    11.4. Adverse
      Proceedings.
      No
      suit, action, claim or governmental proceeding shall be pending against, and
      no
      order, decree or judgment of any court, agency or other governmental authority
      shall have been rendered against, any party hereto that would render it
      unlawful, as of the Closing Date, to effect the transactions contemplated by
      this Agreement in accordance with its terms.

    

    11.5. Deliveries.
      Seller
      shall have made or stand willing to make all the deliveries required under
      Section 13.1.

    

    11.6. Transmitter
      Site Obligations.
      Seller
      shall have completed the items on Schedule
      11.6
      hereto
      to Buyer’s reasonable satisfaction.

    

    ARTICLE
      12

    CONDITIONS
      PRECEDENT TO SELLER’S OBLIGATION TO CLOSE

    

    The
      obligations of Seller hereunder are subject to satisfaction, at or prior to
      the
      Closing Date, of each of the following conditions: 

    

    12.1. Representations,
      Warranties and Covenants.

    

    (a)
      All
      representations and warranties made by Buyer in this Agreement shall be true
      and
      complete in all material respects on and as of the Closing Date as if made
      on
      and as of that date.

    

    (b)
      All
      the terms, covenants and conditions to be complied with and performed by Buyer
      under this Agreement on or prior to the Closing Date shall have been complied
      with or performed in all material respects.

    

    12.2. Governmental
      Consents.
      The
      conditions specified in Article 4 of this Agreement shall have been satisfied,
      and the FCC Consent shall have been granted.

    

    12.3. Adverse
      Proceedings.
      No
      suit, action, claim or governmental proceeding shall be pending against, and
      no
      order, decree or judgment of any court, agency or other governmental authority
      shall have been rendered against any party hereto that would render it unlawful,
      as of the Closing Date, to effect the transactions contemplated by this
      Agreement in accordance with its terms.

    

    12.4. Deliveries.
      Buyer
      shall have made or stand willing to make all the deliveries required under
      Section 13.2.

    

    
      
         

      

      
        17

        
          

        

      

      
         

      

    

    

    ARTICLE
      13

    DOCUMENTS
      TO BE DELIVERED AT THE CLOSING

    

    13.1. Documents
      to be Delivered by Seller.
      At the
      Closing, Seller shall deliver to Buyer the following:

    

    (a)
       a
      certificate of an officer of Seller, dated the Closing Date, in form and
      substance reasonably satisfactory to Buyer, certifying to the fulfillment of
      the
      conditions set forth in Sections 11.1 through 11.6 hereof;

    

    (b)
       instruments
      of conveyance and transfer, in form and substance reasonably satisfactory to
      counsel to Buyer, effecting the sale, transfer, assignment and conveyance of
      the
      Station Assets to Buyer, including, but not limited to, the
      following:

    

    (i) assignment
      of the License and other licenses, permits and registrations included in the
      Station Assets;

    

    (ii) bill
      of
      sale for all Personal Property;

    

    (iii) assignment
      of the Assumed Contracts;

    

    (iv) assignment
      of the tower site License for the Station.

    

    (c)
       resolutions
      of Seller’s Board of Directors authorizing the execution, delivery and
      performance of this Agreement, certified by an officer of Seller;

    

    (d)
       UCC
      Termination Statements with respect to Liens which have been placed of record
      on
      the Station Assets;

    

    (e)
       a
      general
      warranty deed for all owned Real Property, if any, included in the Station
      Assets, in a form acceptable in all material respects to Buyer;

    

    (f)
       Certificates
      of Good Standing of Seller issued by the states of Utah and Nevada;

    

    (g)
       confirmation
      from the United States Department of Reclamation that Seller is in good standing
      with respect to the tower site License constituting the Real
      Property;

    

    (h)
       consents
      from third parties required for the assignment of the Assumed Contracts;
      and

    

    
      
         

      

      
        18

        
          

        

      

      
         

      

    

    (i)
       such
      other documents as may reasonably be requested by Buyer’s counsel.

    

    13.2. Buyer
      Deliveries.
      At the
      Closing, Buyer shall deliver to Seller the following:

    

    (a)
       a
      certificate of an officer of Buyer, dated the Closing Date, in form and
      substance reasonably satisfactory to Seller, certifying to the fulfillment
      of
      the conditions specified in Sections 12.1 through 12.4 hereof;

    

    (b)
       wire
      transfer of immediately available funds as provided in Section 2.2;

    

    (c)
       instruments,
      in form and substance reasonably satisfactory to Seller and its counsel,
      pursuant to which Buyer assumes obligations, liabilities and commitments as
      provided in Article 3; and

    

    (d)
       such
      other documents as may reasonably be requested by Seller’s counsel.

     

    ARTICLE
      14

    FEES
      AND EXPENSES;
      TRANSFER TAXES

    

    14.1. Governmental
      Filing or Grant Fees.
      Except
      as otherwise specified herein, any filing or grant fees imposed by any
      governmental authority, the consent of which is required for the transactions
      contemplated hereby, shall be paid by the party making such filing, except
      that
      the filing fees incurred pursuant to Article 4 in connection with the FCC
      Application, shall be borne equally by Buyer and Seller.

    

    14.2. Transfer
      Taxes.
      Any
      taxes arising by reason of the transfer of the Station Assets as contemplated
      hereby shall be paid equally by Seller and Buyer.

    

    14.3. Expenses.
      Each
      party hereto shall be solely responsible for and shall pay all costs and
      expenses incurred by it in connection with the negotiation, preparation and
      performance of and compliance with the terms of this Agreement.

    

    ARTICLE
      15

    BROKER’S
      COMMISSION OR FINDER’S FEE

    

    
      
         

      

      
        19

        
          

        

      

      
         

      

    

    15.1. Buyer’s
      Representation and Agreement to Indemnify.
      Buyer
      represents and warrants to Seller that, except as regards John L. Pierce &
Company, LLC (“Broker”),
      neither it nor any person or entity acting on its behalf has agreed to pay
      a
      commission, finder’s fee or similar payment in connection with this Agreement or
      any matter related hereto to any person or entity, nor has it or any person
      or
      entity acting on its behalf taken any action on which a claim for any such
      payment could be based. At the Closing, Buyer shall pay Forty-Three Thousand
      Seven Hundred Fifty Dollars ($43,750.00), which represents one half of the
      commission that will be owed to the Broker. Buyer agrees to indemnify and hold
      Seller harmless from and against any and all claims, losses, liabilities and
      expenses (including reasonable attorneys’ fees) arising out of a claim by any
      person or entity other than Broker, based on any such arrangement or agreement
      made or alleged to have been made by Buyer.

    

    15.2. Seller’s
      Representation and Agreement to Indemnify.
      Seller
      represents and warrants to Buyer that, except as regards Broker, neither it
      nor
      any person or entity acting on its behalf has agreed to pay a commission,
      finder’s fee or similar payment in connection with this Agreement or any matter
      related hereto to any person or entity, nor has it or any person or entity
      acting on its behalf taken any action on which a claim for any such payment
      could be based. At the Closing, Seller shall pay Forty-Three Thousand Seven
      Hundred Fifty Dollars ($43,750.00), which represents one half of the commission
      that will be owed to the Broker. Seller agrees to indemnify and hold Buyer
      harmless from and against any and all claims, losses, liabilities and expenses
      (including reasonable attorneys’ fees) arising out of a claim by any person or
      entity other than Broker, based on any such arrangement or agreement made or
      alleged to have been made by Seller.

     

    ARTICLE
      16

    INDEMNIFICATION

    

    16.1. Indemnification
      by Seller.
      Notwithstanding the Closing, Seller hereby agrees to indemnify, defend and
      hold
      Buyer harmless against and with respect to, and shall reimburse Buyer
      for:

    

    (a)
       Any
      and
      all losses, direct or indirect, liabilities, or damages resulting from any
      untrue representation, breach of warranty, or nonfulfillment of any covenant
      or
      obligation by Seller contained herein or in any certificate, document or
      instrument delivered to Buyer hereunder;

    

    (b)
       Any
      and
      all obligations of Seller not assumed by Buyer pursuant to the terms of this
      Agreement;

    

    (c)
       Any
      and
      all losses, liabilities or damages resulting from the construction, operation
      or
      ownership of the Station prior to the Effective Time, or Seller’s acts or
      omissions generally, including but not limited to any and all liabilities not
      assumed by Buyer pursuant to Article 3 hereof; 

    

    
      
         

      

      
        20

        
          

        

      

      
         

      

    

    (d)
       Any
      and
      all actions, suits, proceedings, claims, demands, assessments, judgments, costs
      and expenses, including reasonable legal fees and expenses, incident to any
      of
      the foregoing or incurred in opposing the imposition thereof, or in enforcing
      this indemnity, subject to the notice and opportunity to remedy requirements
      of
      Section 16.3 hereof; and

    

    (e)
       Interest
      at the Prime Rate on any reimbursable expense or loss incurred by Buyer from
      the
      date of payment, in the case of a reimbursable expense, and from the date of
      incurrence, in the case of any other losses, until the date of reimbursement
      by
      Seller.

    

    16.2. Indemnification
      by Buyer.
      Notwithstanding the Closing, Buyer hereby agrees to indemnify and hold the
      Seller harmless against and with respect to, and shall reimburse the Seller
      for:

    

    (a)
       Any
      and
      all losses, direct or indirect, liabilities, or damages resulting from any
      untrue representation, breach of warranty, or nonfulfillment of any covenant
      or
      obligation by Buyer contained herein or in any certificate, document or
      instrument delivered to Seller hereunder;

    

    (b)
       Any
      and
      all obligations of Seller assumed by Buyer pursuant to the terms of this
      Agreement;

    

    (c)
       Any
      and
      all losses, liabilities or damages resulting from the operation or ownership
      of
      the Station by Buyer on and after the Effective Time, or Buyer’s acts or
      omissions generally, including but not limited to any and all liabilities
      assumed by Buyer pursuant to Article 3 hereof;

    

    (d)
       Any
      and
      all actions, suits, proceedings, claims, demands, assessments, judgments, costs
      and expenses, including reasonable legal fees and expenses, incident to any
      of
      the foregoing or incurred in opposing the imposition thereof, or in enforcing
      this indemnity, subject to the notice and opportunity to remedy requirements
      of
      Section 16.3 hereof; and

    

    (e)
       Interest
      at the Prime Rate on any reimbursable expense or loss incurred by Seller from
      the date of payment, in the case of a reimbursable expense, and from the date
      of
      incurrence, in the case of any other losses, until the date of reimbursement
      by
      Buyer.

    

    16.3. Procedure
      for Indemnification.
      The
      procedure for indemnification shall be as follows:

    (a)
       The
      party
      seeking indemnification under this Article 16 (the “Claimant”)
      shall
      give notice to the party from whom indemnification is sought (the “Indemnitor”)
      of any
      claim, whether solely between the parties or brought by a third party,
      specifying (i) the factual basis for the claim, and (ii) the amount of the
      claim. If the claim relates to an action, suit or proceeding filed by a third
      party against Claimant, notice shall be given by Claimant within fifteen (15)
      business days after written notice of the action, suit or proceeding was given
      to Claimant. In all other circumstances, notice shall be given by Claimant
      within thirty (30) days after Claimant becomes, or should have become, aware
      of
      the facts giving rise to the claim. Notwithstanding the foregoing, Claimant’s
      failure to give Indemnitor timely notice shall not preclude Claimant from
      seeking indemnification from Indemnitor except to the extent that Claimant’s
      failure has materially prejudiced Indemnitor’s ability to defend the claim or
      litigation.

    

    
      
         

      

      
        21

        
          

        

      

      
         

      

    

    (b)
       With
      respect to claims between the parties, following receipt of notice from the
      Claimant of a claim, the Indemnitor shall have thirty (30) calendar days to
      make
      any investigation of the claim that the Indemnitor deems necessary or desirable.
      For the purposes of this investigation, the Claimant agrees to make available
      to
      the Indemnitor and/or its authorized representatives the information relied
      upon
      by the Claimant to substantiate the claim. If the Claimant and the Indemnitor
      cannot agree as to the validity and amount of the claim within the 30-day period
      (or any mutually agreed upon extension thereof), the Claimant may seek
      appropriate legal remedy.

    

    (c)
       With
      respect to any claim by a third party as to which the Claimant is entitled
      to
      indemnification hereunder, the Indemnitor shall have the right at its own
      expense to participate in or assume control of the defense of the claim, and
      the
      Claimant shall cooperate fully with the Indemnitor, subject to reimbursement
      for
      actual out-of-pocket expenses incurred by the Claimant as the result of a
      request by the Indemnitor. If the Indemnitor elects to assume control of the
      defense of any third-party claim, the Claimant shall have the right to
      participate in the defense of the claim as its own expense. If the Indemnitor
      does not elect to assume control or otherwise participate in the defense of
      any
      third party claim, Claimant may, but shall have no obligation to, defend or
      settle such claim or litigation in such manner as it deems appropriate, and
      in
      any event Indemnitor shall be bound by the results obtained by the Claimant
      with
      respect to the claim (by default or otherwise) and shall promptly reimburse
      Claimant for the amount of all expenses (including the amount of any judgment
      rendered), legal or otherwise, incurred in connection with such claim or
      litigation. The Indemnitor shall be subrogated to all rights of the Claimant
      against any third party with respect to any claim for which indemnity was
      paid.

    

    16.4. Limitations.
      Neither
      Seller nor Buyer shall have any obligation to the other party for any matter
      described in Section 16.1 or Section 16.2, as the case may be, except upon
      compliance by the other party with the provisions of this Article 16,
      particularly Section 16.3. Neither party shall be required to indemnify the
      other party under this Article 16 for any breach of any representation or
      warranty contained in this Agreement unless written notice of a claim under
      this
      Article 16 was received by the party within the pertinent survival period
      specified in Article 18 of this Agreement.

    

    16.5. Sole
      Remedy.
      After
      the Closing, the right to indemnification under this Article 16 shall be the
      exclusive remedy of any party in connection with any breach by another party
      of
      its representations, warranties and covenants.

    

    
      
         

      

      
        22

        
          

        

      

      
         

      

    

    ARTICLE
      17

    TERMINATION
      RIGHTS

    

    17.1. Termination.

    

    This
      Agreement may be terminated by Buyer, pursuant to the terms of Sections 10.6
      and
      10.7 hereof. This Agreement may be terminated by either Buyer or Seller if
      the
      party seeking to terminate is not in material default or breach of this
      Agreement, upon written notice to the other upon the occurrence of any of the
      following:

    

    (a)
       if,
      on or
      prior to the Closing Date, the other party defaults in any material respect
      in
      the observance or in the due and timely performance of any of its covenants
      or
      agreements contained herein and such default has not been cured within twenty
      (20) business days from receipt of written notice of default from the
      non-defaulting party;

    

    (b)
       if
      the
      FCC denies the FCC Application by Final Order, or designates it for a trial-type
      hearing; or

    

    (c)
       if
      there
      shall be in effect any judgment, final decree or order that would prevent or
      make unlawful the Closing; 

    

    In
      the
      event Buyer terminates this Agreement pursuant to this Section 17.1, the Escrow
      Deposit, including all interest earned thereon, the First Additional Deposit,
      and the Second Additional Deposit shall be promptly refunded to
      Buyer.

    

    17.2. Liability.
      The
      termination of this Agreement under Section 17.1 hereof shall not relieve any
      party of any liability for breach of this Agreement prior to the date of
      termination.

     

    ARTICLE
      18

    SURVIVAL
      OF REPRESENTATIONS, 

    WARRANTIES
      AND COVENANTS

    

    The
      representations, warranties, covenants, indemnities and agreements contained
      in
      this Agreement or in any certificate, document or instrument delivered pursuant
      to this Agreement are and will be deemed and construed to be continuing
      representations, warranties, covenants, indemnities and agreements and shall
      survive the Closing for a period of two years after the Closing Date. No claim
      may be brought under this Agreement or any other certificate, document or
      instrument delivered pursuant to this Agreement unless written notice describing
      in reasonable detail the nature and basis of such claim is given on or prior
      to
      the last day of the applicable survival period. In the event such a notice
      is
      given, the right to indemnification with respect thereto shall survive the
      applicable survival period until such claim is finally resolved and any
      obligations thereto are fully satisfied. Any investigation by or on behalf
      of
      any party hereto shall not constitute a waiver as to enforcement of any
      representation, warranty, covenant or agreement contained herein.

    

    
      
         

      

      
        23

        
          

        

      

      
         

      

    

    ARTICLE
      19

    REMEDIES
      UPON DEFAULT

    

    19.1. Default
      by Seller.
      Seller
      recognizes that upon a default of this Agreement by Seller, monetary damages
      alone will not be adequate, and Buyer shall therefore be entitled in the event
      of a default by Seller, in addition to bringing suit at law or equity for money
      or other damages or for indemnification under Article 16 hereof, to obtain
      specific performance of the terms of this Agreement. In any action to enforce
      the provisions of this Agreement, Seller shall waive the defense that there
      is
      an adequate remedy at law or equity and agree that Buyer shall have the right
      to
      obtain specific performance of the terms of this Agreement without being
      required to prove actual damages, post bond or furnish other security. In
      addition, Buyer shall be entitled to obtain from Seller court costs and
      reasonable attorneys’ fees incurred by it in enforcing its rights hereunder,
      plus interest at the Prime Rate on the amount of any judgment obtained against
      Seller from the date of default until the date of payment of the judgment.
      As a
      condition to seeking specific performance, Buyer shall not be required to have
      tendered the Purchase Price specified in Section 2.1 of this Agreement, but
      shall be required to demonstrate that it is willing and able to do so and to
      perform its other closing obligations in all respects.

    

    19.2. Default
      by Buyer.
      If the
      transactions contemplated by this Agreement are not consummated as a result
      of
      Buyer’s default of this Agreement or wrongful failure to close hereunder, and
      Seller is not also in material breach hereunder, Seller shall be entitled to
      payment of One Hundred Thousand Dollars ($100,000.00) as liquidated damages
      in
      full settlement of any damages of any nature or kind that Seller may suffer
      or
      allege to suffer as the result thereof. It is understood and agreed that the
      amount of liquidated damages represents Buyer’s and Seller’s reasonable estimate
      of actual damages and does not constitute a penalty. Recovery of liquidated
      damages under this Section 19.2 shall be the sole and exclusive remedy of Seller
      against Buyer for breach of or failure to consummate this Agreement and shall
      be
      applicable regardless of the actual amount of damages sustained. In addition,
      Seller shall be entitled to obtain from Buyer court costs and reasonable
      attorneys’ fees incurred by it in enforcing its rights hereunder, plus interest
      at the Prime Rate on the amount of any judgment obtained against Buyer from
      the
      date of default until the date of payment of the judgment. As a condition to
      obtaining liquidated damages, Seller shall not be required to have tendered
      the
      Station Assets but shall be required to demonstrate that it is willing and
      able
      to do so and to perform its other closing obligations in all material
      respects.

    

    ARTICLE
      20

    RISK
      OF LOSS

    

    The
      risk
      of loss or damage to the Station Assets prior to the Effective Time shall be
      upon Seller. Seller shall repair, replace and restore, or assign to Buyer the
      insurance proceeds that will fully reimburse Buyer for repairing, replacing
      and
      restoring, any damaged or lost material Station Asset to its prior condition
      as
      soon as possible and in no event later than the Effective Time. If Seller is
      unable or fails to repair, restore or replace a lost or damaged item required
      to
      be repaired or replaced by Seller prior to the Closing, or if Seller fails
      to
      assign the associated insurance proceeds to Buyer, then at Buyer’s sole election
      (i) there shall be a reduction in the Purchase Price equal to the cost of such
      repair, restoration, or replacement, or (ii) Seller shall reimburse Buyer for
      the cost of the repair, restoration or replacement of such item incurred by
      Buyer after the Closing.

    

    
      
         

      

      
        24

        
          

        

      

      
         

      

    

    

    ARTICLE
      21

    OTHER
      PROVISIONS

    

    21.1. Publicity.
      Except
      as required by applicable law or with the other party’s express written consent,
      no party to this Agreement nor any affiliate of any party shall issue any press
      release or similar public statement regarding the transactions contemplated
      by
      this Agreement.

    

    21.2. Benefit
      and Assignment.
      This
      Agreement shall be binding upon and shall inure to the benefit of the parties
      hereto and their respective successors and assigns. Neither Buyer nor Seller
      may
      assign this Agreement without the prior written consent of the other party
      hereto, except that Buyer may assign this Agreement to an Affiliate if Buyer
      fully guarantees to Seller the performance hereunder of its
      Affiliate.

    

    21.3. Entire
      Agreement.
      This
      Agreement and the exhibits and schedules hereto and thereto embody the entire
      agreement and understanding of the parties hereto and supersedes any and all
      prior agreements, arrangements and understandings relating to the matters
      provided for herein. No amendment, waiver of compliance with any provision
      or
      condition hereof, or consent pursuant to this Agreement shall be effective
      unless evidenced by an instrument in writing signed by the party against whom
      enforcement of any waiver, amendment, change, extension or discharge is sought.
      Any matter that is disclosed in a Schedule hereto in such a way as to make
      its
      relevance to the information called for by another Schedule readily apparent
      shall be deemed to have been included in such other Schedule, notwithstanding
      the omission of an appropriate cross-reference.

    

    21.4. Headings.
      The
      headings set forth in this Agreement are for convenience only and will not
      control or affect the meaning or construction of the provisions of this
      Agreement. 

    

    21.5. Computation
      of Time.
      If
      after making computations of time provided for in this Agreement, a time for
      action or notice falls on Saturday, Sunday or a Federal holiday, then such
      time
      shall be extended to the next business day.

    

    
      
         

      

      
        25

        
          

        

      

      
         

      

    

    21.6. Governing
      Law.
      The
      construction and performance of this Agreement shall be governed by the laws
      of
      the State of Nevada without regard to its principles of conflict of
      law.

    

    21.7. Notices.
      Any
      notice, demand or request required or permitted to be given under the provisions
      of this Agreement shall be in writing, addressed to the following addresses,
      or
      to such other address as any party may request in writing.

    

    If
      to
      Buyer: 

    

    Beasley
      Broadcast Group Inc.

    Suite
      200

    3033
      Riviera Drive

    Naples,
      FL 34103

    Attention:
      Ms. Caroline Beasley

    Telephone:
      239-263-5000

    

    With
      a
      copy to:

    

    Leventhal
      Senter & Lerman PLLC

    2000
      K
      Street, N.W.

    Suite
      600

    Washington,
      DC 20006-1809

    Attention:
      Sally A. Buckman, Esq.

    Telephone:
      (202) 429-8970

    Facsimile:
      (202) 293-7783

    

    

    If
      to
      Seller: 

    

    AM
      Radio
      790, Inc.

    210
      N.
      1000 East

    St.
      George, UT 84770

    Att’n:
      E.
      Morgan Skinner, Jr.

    Telephone:
      (435) 628-1000

    Facsimile:
      (435) 628-6636

    

    
      
         

      

      
        26

        
          

        

      

      
         

      

    

    With
      a
      copy to:

    

    Dan
      J.
      Alpert, Esq.

    The
      Law
      Office of Dan J. Alpert

    2120
      N.
      21st
      Rd.

    Arlington,
      VA 22201

    Telephone:
      (703) 243-8690

    Facsmile:
      (703) 243-8692

    

    Any
      such
      notice, demand or request shall be deemed to have been duly delivered and
      received (i) on the date of personal delivery, or (ii) on the date of
      transmission, if sent by facsimile (but only if a hard copy is also sent by
      overnight courier), or (iii) on the date of receipt, if mailed by registered
      or
      certified mail, postage prepaid and return receipt requested, or (iv) on the
      date of a signed receipt, if sent by an overnight delivery service, but only
      if
      sent in the same manner to all persons entitled to receive notice or a
      copy.

    

    21.8. Counterparts.
      This
      Agreement may be executed in one or more counterparts, each of which will be
      deemed an original and all of which together will constitute one and the same
      instrument.

    

    21.9. Further
      Assurances.
      Seller
      shall at any time and from time to time after the Closing execute and deliver
      to
      Buyer such further conveyances, assignments and other written assurances as
      Buyer may reasonably request in order to vest and confirm in Buyer (or its
      assignees) the title and rights to and in all of the Station Assets to be and
      intended to be transferred, assigned and conveyed hereunder.

    

    ARTICLE
      22

    DEFINITIONS

    

    Unless
      otherwise stated in this Agreement, the following terms when used herein shall
      have the meanings assigned to them below (such meanings to be equally applicable
      to both the singular and plural forms of the terms defined).

    

    “Affiliate”
      shall
      mean any person or entity that is controlling, controlled by or under common
      control with the named person or entity.

    

    “Agreement”
      shall
      mean this Asset Purchase Agreement, including the exhibits and schedules
      hereto.

    

    “Assumed
      Contracts”
      shall
      have the meaning set forth in Section 1.2(d).

    

    “Buyer”
      shall
      have the meaning set forth in the preamble to this Agreement.

    

    “Buyer’s
      Proration Amount”
      shall
      have the meaning set forth in Section 5.2.

    

    
      
         

      

      
        27

        
          

        

      

      
         

      

    

    “Business
      Day”
      whether
      or not capitalized, shall mean every day of the week excluding Saturdays,
      Sundays and Federal holidays.

    

    “Claimant”
      shall
      have the meaning set forth in Section 16.3(a).

    

    “Closing”
      shall
      have the meaning set forth in Section 1.1. 

    

    “Closing
      Date”
      shall
      mean the date on which the Closing is completed.

    

    “Contracts”
      shall
      mean the contracts, agreements, including employment agreements, commitments
      and
      understandings of Seller or to which Seller is a party, relating to the conduct
      of the business and operation of the Station.

    

    “Effective
      Time”
      shall
      mean 12:01 a.m., local Winchester, Nevada time, on the Closing
      Date.

    

    “Environmental
      Laws”
      shall
      mean any applicable federal, state or local law, statute, charter, ordinance,
      rule or regulation or any governmental agency interpretation, policy or
      guidance, and any FCC authorization, order, directive, court ruling or order
      or
      consent decree applicable to or affecting the Real Property.

    

    “ERISA”
      shall
      have the meaning set forth in Section 7.8(c).

    

    “Excluded
      Assets” shall
      have the meaning set forth in Section 1.3.

    

    “FCC”
      shall
      mean the Federal Communications Commission.

    

    “FCC
      Application”
      shall
      mean the application or applications (FCC Form 314) that Seller and Buyer must
      file with the FCC requesting its consent to the assignment of the Permit or
      License.

    

    “FCC
      Consent”
      shall
      mean the action by the FCC granting the FCC Application.

    

    “Final
      Order”
      shall
      mean action by the FCC (i) which has not been vacated, reversed, stayed, set
      aside, annulled or suspended, (ii) with respect to which no timely appeal,
      request for stay or petition for rehearing, reconsideration or review by any
      party or by the FCC on its own motion, is pending, and (iii) as to which the
      time for filing any such appeal, request, petition, or similar document or
      for
      the reconsideration or review by the FCC on its own motion under the
      Communications Act of 1934, as amended, and the rules and regulations of the
      Commission, has expired.

    

    “First
      Additional Deposit”
      shall
      have the meaning set forth in Section 2.2.

    

    “Hazardous
      Substance”
shall
      have the meaning set forth in Section 7.13.

    

    
      
         

      

      
        28

        
          

        

      

      
         

      

    

    “Hazardous
      Waste”
shall
      have the meaning set forth in Section 7.13.

    

    “Indemnitor”
      shall
      have the meaning set forth in Section 16.3(a).

    

    “Intellectual
      Property”
      shall
      have the meaning set forth in Section 7.9.

    

    “License”
shall
      have the meaning set forth in the Recitals to this Agreement. 

    

    “License
      Application”
      shall
      have the meaning set forth in the Recitals to this Agreement.

    

    “Liens”
      shall
      mean mortgages, deeds of trust, liens, pledges, collateral assignments, security
      interests, leases, subleases, conditional sales agreements, easements,
      covenants, encroachments, encumbrances, restrictions, charges or other defects
      of title.

    

    “LS&L”
      shall
      have the meaning set forth in Section 1.1.

    

    “Notice
      of Disagreement”
      shall
      have the meaning set forth in Section 5.2.

    

    “Option
      Agreement” shall
      have the meaning set forth in the Recitals to this Agreement.

    

    “Option
      Payment” shall
      have the meaning set forth in the Recitals to this Agreement.

    

    “Permit”
      shall
      have the meaning set forth in the Recitals to this Agreement.

    

    “Personal
      Property”
      shall
      have the meaning set forth in Section 1.2(c).

    

    “Phase
      I Report”
      shall
      have the meaning set forth in Section 10.7.

    

    “Phase
      II Report” shall
      have the meaning set forth in Section 10.7.

    

    “Preliminary
      Proration Schedule”
      shall
      have the meaning set forth in Section 5.2.

    

    “Prime
      Rate”
      shall
      mean a per annum rate equal to the “prime rate” as published in the Money Rates
      column of the Eastern Edition of The
      Wall Street Journal
      (or the
      average of such rates if more than one rate is indicated).

    

    “Proration
      Schedule”
      shall
      have the meaning set forth in Section 5.2.

    

    “Purchase
      Price”
      shall
      have the meaning set forth in Section 2.1(a).

    

    
      
         

      

      
        29

        
          

        

      

      
         

      

    

    “Real
      Property”
      shall
      have the meaning set forth in Section 1.2(b).

    

    “Referee”
      shall
      have the meaning set forth in Section 5.2.

    

    “Second
      Additional Deposit” shall
      have the meaning set forth in Section 2.2.

    

    “Seller”
      shall
      have the meaning set forth in the preamble to this Agreement.

    

    “Station”
      shall
      have the meaning set forth in the Recitals to this Agreement..

    

    “Station
      Assets”
      shall
      have the meaning set forth in Section 1.2.

    

    
      
         

      

      
        30

        
          

        

      

      
         

      

    

     

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

    

    
      	 	 	 
	 	KDWN
              LICENSE LIMITED PARTNERSHIP
	 
 	 
 	 
 
	 	By:  	/s/
              Caroline Beasley
	 	
              
Name:
              Caroline Beasley
	 	Title: Managing
              Member

     

    
      	 	 	 
	 	BEASLEY
              FM
              ACQUISITION CORP.
	 
 	 
 	 
 
	 	By:  	/s/
              Caroline Beasley
	 	
              
Name:
              Caroline Beasley
	 	Title: President

    

    
      	 	 	 
	 	AM
              RADIO
              790, INC.
	 
 	 
 	 
 
	 	By:  	/s/
              E.
              Morgan Skinner, Jr.
	 	
              
Name:
 E.
              Morgan Skinner, Jr.
	 	Title:
               President  

     

    
      
         

      

      
        31

        
          

        

      

      
         

      

    

    

    

    SCHEDULES

    

    Schedules

    

    

    
      	
              Schedule
                1.2(a)

            	
              Station
                Licenses and Permits

            
	
              Schedule
                1.2(b)

            	
              Real
                Property

            
	
              Schedule
                1.2(c)

            	
              Personal
                Property

            
	
              Schedule
                1.2(d)

            	
              Assumed
                Contracts

            
	
              Schedule
                1.2(e)

            	
              Intangible
                Property

            
	
              Schedule
                2.2

            	
              Obligations
                to U.S. Capital, Inc.

            
	
              Schedule
                7.12

            	
              Outstanding
                UCC Filings

            
	
              Schedule
                11.6

            	
              Transmitter
                Site Obligations

            

    

    

    

    
      
         

      

      
        32

        
          

        

      

      
         

      

    

    

    SCHEDULE
      1.1(a)

    Station
      Licenses and Permits

    

    Station
      KBET FCC Authorizations

    Construction
      Permit File No. BMP-20060105ACO, granted 2/13/2006

    Program
      Test Authority File No. BPTA-20060711ADI, granted 11/1/1006

    License
      to Cover, File No. BL-20060714ACX (pending)

    Application
      for Modification (Augmentation) of Construction Permit, File No.
      BMP-20061101AEG
      (pending)

    

    “License
      for Four AM Radio Towers,” dated October 10, 2005, between the United States
Department
      of the Interior and AM Radio 790, Inc.

     

    
      
         

      

      
        33

        
          

        

      

      
         

      

    

    

    SCHEDULE
      1.2(b)

    Real
      Property

    

    “License
      for Four AM Radio Towers,” dated October 10, 2005, between the United States
Department
      of the Interior and AM Radio 790, Inc.

    

    Liens

    U.S.
      Capital, Inc.

    Dan
      J.
      Alpert

    Paragon
      Advertising and Communication, Inc.

    

    
      
        
          40

          

           

        

        
          34

          
            

          

        

        
           

        

      

    

    

    SCHEDULE
      1.2(c)

    Personal
      Property

    

    

    
      
        	4	
                195’
                  Steel Towers painted per BoR color
                  recommendation

              

      

    

    
      
        	
                4

              	
                Guyed
                  & anchored. Engineered to withstand 90-mph
                  top-winds

              

      

    

    
      	
              4

            	
              Each
                tower top-loaded with 19.6-degree of upper-most guy
                cables.

            

    

    
      
        	4	
                Each
                  tower surrounded by 120 equally spaced #8 awg. Copper ground radials
                  311’
                  in length

              

      

    

    
      
        	
                4

              	
                Antenna
                  Tuning Boxes w/components

              

      

    

    
      	
              1,080’

            	
              Transmission
                Line (Andrews 1⁄2”)

            

    

    
      	1,560’	
              Sample
                Lines (Andrews 1⁄2”)

            

    

    
      	4	
              Security
                fences 6’ w/security wire 15’ from base of each tower
                

            

    

    
      	1	
              Sine
                Systems RFC-1/B
                Remote Facilities

            

    

    
      
        	1	
                Orban
                  AM9200U Audio Processor

              

      

    

    
      
        	
                1

              	
                Belar
                  AMM-3 Modulation Monitor

              

      

    

    
      
        	
                
                  1

                

              	
                Nautel
                  -Jazz Series J1000 

              

      

    

    
      
        	
                
                  1

                

              	
                Equipment
                  rack - Mid-Atlantic 

              

      

    

    
      
        	
                2

              	
                4-Tower
                  Phasor, Bill Sitzman, PE
                  -Design

              

      

    

    
      
        	
                1

              	
                4-tower
                  Potomac Phase Monitor, Model
                  19

              

      

    

    
      	
              1

            	
              Kintronics
                Phasor controller

            

    

    
      	1	
              Tellular
                Wireless Phone w/Sprint wireless
                service

            

    

    
      
        	1	
                Secure
                  (12’x18’) Air Conditioned
                  Building

              

      

    

    
      
        	
                1

              	
                2
                  1/2 ton A/C unit 

              

      

    

    
      
        	
                1

              	
                Perimeter
                  fence - Tortoise Exclusion fence with 3-strand non-barbed
                  wire w/steel posts

              

      

    

    
 

    
      
         

      

      
        35

        
          

        

      

      
         

      

    

    SCHEDULE
      1.2(d)

    Assumed
      Contracts

     

     

    “Affiliation
      Agreement” between Westwood One Radio Networks and AM Radio 790, Inc.,
dated
      October 13, 2004, and “Rider” to Affiliation Agreement, dated October 13,
      2005.

    

     

     

    
      
         

      

      
        36

        
          

        

      

      
         

      

    

    

    SCHEDULE
      1.2(e)

    Intangible
      Property

    

    Call
      Letters “KBET”

     

    
 

    
      
         

      

      
        37

        
          

        

      

      
         

      

    

    

    SCHEDULE
      2.2

    Obligations
      to U.S. Capital

    

    
      	
              Creditor:

            	
              US
                Capital, Inc. - $603,500.

            
	 	 
	 	 
	 	 
	
              Creditor:

            	
              US
                Capital, Inc. - $750,000 

            

    

     

    

     

    

    
      
         

      

      
        38

        
          

        

      

      
         

      

    

    SCHEDULE
      7.2

    Outstanding
      UCC Filings

    

    U.S.
      Capital, Inc.

    Dan
      J.
      Alpert

    Paragon
      Advertising and Communication, Inc.

     

    
 

     

    
      
         

      

      
        39

        
          

        

      

      
         

      

    

    

    SCHEDULE
      11.6

    Transmitter
      Site Obligations

    

    Prior
      to
      Closing, Seller shall have completed the following at the Station’s transmitter
      site:

    

    
      
        	1.	
                Install
                  appropriate fencing around tower bases to prevent public
                  access.

              

      

    

    
      
        	
                2.

              	
                Post
                  RF warning signs around perimeter fence and transmitter building
                  as
                  required by FCC and OSHA
                  rules.

              

      

    

    
      
        	
                3.

              	
                Install
                  air conditioning system at transmitter
                  building.

              

      

    

    
      
        	
                4.

              	
                Replace
                  stolen items including phasor controller, Tellular Cellular Remote
                  interface, and Common point
                  meter.

              

      

    

    
      
        	
                5.

              	
                Connect
                  ATU relay controls.

              

      

    

    .

     

     

    
      
         

      

      
        40

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