Document:

Unassociated Document

     

    

      

      NOVASTAR
        RESOURCES LTD.

       

      2006
        STOCK PLAN

       

      NOTICE
        OF GRANT

       

      Capitalized
        but otherwise undefined terms in this Notice of Grant and the attached Stock
        Option Agreement shall have the same defined meanings as in the 2006 Stock
        Plan.

       

      
        	
                Name:              George
                  D. Crowley,
                  Jr.         

              	
                Address: c/o
                  The Crowley Group, 4445 Willard Avenue, Suite 1050, Chevy Chase,
                  Maryland
                  20815

              
	 	 

      

      You
        have
        been granted an option (the “Option”) to purchase Common Stock of the
        Corporation, subject to the terms and conditions of the Plan and the attached
        Stock Option Agreement, as follows:

       

      
        	
                Date
                  of Grant:

              	
                April
                  25, 2006

              
	 	 
	
                Option
                  Price per Share:

              	
                $0.64

              
	 	 
	
                Total
                  Number of Shares Granted:

              	
                2,000,000

              
	 	 
	
                Total
                  Option Price:

              	
                $1,280,000

              
	 	 
	
                Type
                  of Option:

              	
                Nonqualified
                  Stock Option

              
	 	 
	
                Term/Expiration
                  date:

              	
                Ten
                  (10) years after Date of Grant

              

      

       

      Exercise
        Schedule:

       

      The
        Option shall be exercisable, in whole or in part, in accordance with the
        following schedule:

       

      The
        Option shall be exercisable with respect to 500,000 shares on the first day
        of
        the sixth month following the Date of Grant and shall thereafter become
        exercisable with respect to 41,667 shares on the first day of each month
        until
        all shares underlying the Option have become exercisable. The Option shall
        immediately and automatically become exercisable in full upon a Change of
        Control. For purposes of this Notice of Grant, a “Change of Control” shall be
        deemed to have occurred if (i) a tender offer shall be made and consummated
        for
        the ownership of more than 50% of the outstanding voting securities of the
        Company, (ii) the Company shall be merged or consolidated with another
        corporation or entity and as a result of such merger or consolidation less
        than
        50% of the outstanding voting securities of the surviving or resulting
        corporation or entity shall be owned in the aggregate by former shareholders
        of
        the Company, as the same shall have existing immediately prior to such merger
        or
        consolidation, (iii) the Company shall sell, lease, or otherwise dispose
        of, all
        or substantially all of its assets to another corporation or entity which
        is not
        a wholly-owned subsidiary, or (iv) a person, within the meaning of Section
        3(a)(9) or Section 13(d)(3) (as in effect on the date hereof) of the Securities
        Exchange Act of 1934 shall acquire more than 50% of the outstanding voting
        securities of the Company (whether directly, indirectly, beneficially, or
        of
        record). Notwithstanding the foregoing, the transactions contemplated by
        the
        Agreement and Plan of Merger, dated February 14, 2006, between the Company
        and
        Thorium Power, Inc. shall not constitute a Change of Control.

      
        
          
          

        

        
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      NOVASTAR
        RESOURCES LTD.

      

      2006
        STOCK PLAN

      

      STOCK
        OPTION AGREEMENT

      

      

       

      This
        STOCK
        OPTION AGREEMENT (“Agreement”),
        dated as of the 25th day of April, 2006 is made by and between NOVASTAR
        RESOURCES LTD., a Nevada corporation (the “Corporation”), and George D.Crowley,
        Jr. (the “Optionee,” which term as used herein shall be deemed to include any
        successor to the Optionee by will or by the laws of descent and distribution,
        unless the context shall otherwise require).

       

      BACKGROUND

       

      Pursuant
        to the Corporation’s 2006 Stock Plan (the “Plan”), the Corporation, acting
        through the Committee of the Board of Directors (if a committee has been
        formed
        to administer the Plan) or its entire Board of Directors (if no such committee
        has been formed) responsible for administering the Plan (in either case,
        referred to herein as the “Committee”), approved the issuance to the Optionee,
        effective as of the date set forth above, of a stock option to purchase shares
        of Common Stock of the Corporation at the price (the “Option Price”) set forth
        in the attached Notice of Grant (which is expressly incorporated herein and
        made
        a part hereof, the “Notice of Grant”), upon the terms and conditions hereinafter
        set forth.

       

      NOW,
        THEREFORE,
        in
        consideration of the mutual premises and undertakings hereinafter set forth,
        the
        parties hereto agree as follows:

       

      1. Option;
        Option Price.
        On
        behalf of the Corporation, the Committee hereby grants to the Optionee the
        option (the “Option”) to purchase, subject to the terms and conditions of this
        Agreement and the Plan (which is incorporated by reference herein and which
        in
        all cases shall control in the event of any conflict with the terms, definitions
        and provisions of this Agreement), that number of shares of Common Stock
        of the
        Corporation set forth in the Notice of Grant, at an exercise price per share
        equal to the Option Price as is set forth in the Notice of Grant (the “Optioned
        Shares”). If designated in the Notice of Grant as an “incentive stock option,”
the Option is intended to qualify for Federal income tax purposes as an
“incentive stock option” within the meaning of Section 422 of the Code. A copy
        of the Plan as in effect on the date hereof has been supplied to the Optionee,
        and the Optionee hereby acknowledges receipt thereof.

       

      2. Term.
        The term
        (the “Option Term”) of the Option shall commence on the date of this Agreement
        and shall expire on the Expiration Date set forth in the Notice of Grant
        unless
        such Option shall theretofore have been terminated in accordance with the
        terms
        of the Notice of Grant, this Agreement or of the Plan.

       

      3. Time
        of Exercise.
        

       

      (a) Unless
        accelerated in the discretion of the Committee or as otherwise provided herein,
        the Option shall become exercisable during its term in accordance with the
        Vesting Schedule set out in the Notice of Grant. Subject to the provisions
        of
        Sections 5 and 8 hereof, shares as to which the Option becomes exercisable
        pursuant to the foregoing provisions may be purchased at any time thereafter
        prior to the expiration or termination of the Option.

      
        
          
          

        

        
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      (b) Anything
        contained in this Agreement to the contrary notwithstanding, to the extent
        the
        Option is intended to be an Incentive Stock Option, the Option shall not
        be
        exercisable as an Incentive Stock Option, and shall be treated as a
        Non-Statutory Option, to the extent that the aggregate Fair Market Value
        on the
        date hereof of all stock with respect to which Incentive Stock Options are
        exercisable for the first time by the Optionee during any calendar year (under
        the Plan and all other plans of the Corporation, its parent and its
        subsidiaries, if any) exceeds $100,000.

       

      4. Termination
        of Option.

       

      (a) The
        Optionee may exercise the Option (but only to the extent the Option was
        exercisable at the time of termination of the Optionee’s Business Relationship
        with the Corporation, its parent or any of its subsidiaries) at any time
        within
        two years following the termination of the Optionee’s Business Relationship with
        the Corporation, its parent or any of its subsidiaries, but not later than
        the
        scheduled expiration date. If the Optionee is a natural person who dies while
        in
        a Business Relationship with the Corporation, its parent or any of its
        subsidiaries, this option may be exercised, to the extent of the number of
        shares with respect to which the Optionee could have exercised it on the
        date of
        his death, by his estate, personal representative or beneficiary to whom
        this
        option has been assigned pursuant to Section 9 of the Plan, at any time within
        the two (2) year period following the date of death. If the Optionee is a
        natural person whose Business Relationship with the Corporation, its parent
        or
        any of its subsidiaries is terminated by reason of his disability, this Option
        may be exercised, to the extent of the number of shares with respect to which
        the Optionee could have exercised it on the date the Business Relationship
        was
        terminated, at any time within the two (2) year period following the date
        of
        such termination, but not later than the scheduled expiration date. At the
        expiration of such two (2) year period or the scheduled expiration date,
        whichever is the earlier, this Option shall terminate and the only rights
        hereunder shall be those as to which the Option was properly exercised before
        such termination.

       

      (b) Anything
        contained herein to the contrary notwithstanding, the Option shall not be
        affected by any change of duties or position of the Optionee (including a
        transfer to or from the Corporation, its parent or any of its subsidiaries)
        so
        long as the Optionee continues in a Business Relationship with the Corporation,
        its parent or any of its subsidiaries.

       

      5. Procedure
        for Exercise.

       

      (a) The
        Option may be exercised, from time to time, in whole or in part (but for
        the
        purchase of whole shares only), by delivery of a written notice in the form
        attached as Exhibit
        A
        hereto
        (the “Notice”) from the Optionee to the Secretary of the Corporation, which
        Notice shall: 

       

      (i) state
        that the Optionee elects to exercise the Option;

       

      (ii) state
        the
        number of shares with respect to which the Option is being exercised (the
        “Optioned Shares”);

      
        
          
          

        

        
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      (iii) state
        the
        method of payment for the Optioned Shares pursuant to Section 5(b);

       

      (iv) state
        the
        date upon which the Optionee desires to consummate the purchase of the Optioned
        Shares (which date must be prior to the termination of such Option and no
        later
        than 30 days from the delivery of such Notice);

       

      (v) include
        any representations of the Optionee required under Section 8(b); 

       

      (vi) if
        the
        Option shall be exercised in accordance with Section 9 of the Plan by any
        person
        other than the Optionee, include evidence to the satisfaction of the Committee
        of the right of such person to exercise the Option; and

       

      (b) Payment
        of the Option Price for the Optioned Shares shall be made either (i)
        by
        delivery of cash or a check to the order of the Corporation in an amount
        equal
        to the Option Price, (ii) if approved by the Committee, by delivery to the
        Corporation of shares of Common Stock of the Corporation having a Fair Market
        Value on the date of exercise equal in amount to the Option Price of the
        options
        being exercised, (iii) by any other means which the Board of Directors
        determines are consistent with the purpose of the Plan and with applicable
        laws
        and regulations (including, without limitation, the provisions of Rule 16b-3
        and
        Regulation T promulgated by the Federal Reserve Board), or (iv) by any
        combination of such methods of payment. Notwithstanding
        any provisions herein to the contrary, if the Fair Market Value of one share
        of
        Common Stock of the Corporation is greater than the Option Price (at the
        date of
        calculation as set forth below), in lieu of paying the Option Price in cash,
        the
        Optionee may elect to receive shares equal to the value (as determined below)
        of
        the Optioned Shares by delivering notice of such election to the Corporation
        in
        which event the Corporation shall issue to the Optionee a number of shares
        of
        Common Stock computed using the following formula:

      

        
          	 	
                  X
                    =
                    Y(A-B)

                	 
	 	
                  A

                	
                   

                	 
	
                  Where

                	
                  X

                	
                  =

                	
                  the
                    number of shares of Common Stock to be issued to the Optionee
                    

                
	 	
                  Y

                	
                  =

                	
                  the
                    number of Optioned Shares

                
	 	
                  A

                	
                  =

                	
                  the
                    Fair Market Value of one share of Common Stock (at the date of
                    such
                    calculation)

                
	
                   

                	
                  
                    B
                      

                  

                	
                  =
                    

                	
                  Option
                    Price (as adjusted to the date of such
                    calculation)
 

        

         

      

      (c) The
        Corporation shall issue a stock certificate in the name of the Optionee (or
        such
        other person exercising the Option in accordance with the provisions of Section
        9 of the Plan) for the Optioned Shares as soon as practicable after receipt
        of
        the Notice and payment of the aggregate Option Price for such
        shares.

       

      6. No
        Rights as a Stockholder.
        The
        Optionee shall not have any privileges of a stockholder of the Corporation
        with
        respect to any Optioned Shares until the date of issuance of a stock certificate
        pursuant to Section 5(c).

      
        
          
          

        

        
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      7.  Adjustments. The
        Plan
        contains provisions covering the treatment of options in a number of
        contingencies such as stock splits and mergers. Provisions in the Plan for
        adjustment with respect to stock subject to options and the related provisions
        with respect to successors to the business of the Corporation are hereby
        made
        applicable hereunder and are incorporated herein by reference. In general,
        the
        Optionee should not assume that options would survive the acquisition of
        the
        Corporation.

       

      8. Additional
        Provisions Related to Exercise.
        

       

      (a) The
        Option shall be exercisable only on such date or dates and during such period
        and for such number of shares of Common Stock as are set forth in this
        Agreement.

       

      (b) To
        exercise the Option, the Optionee shall follow the procedures set forth in
        Section 5 hereof. Upon the exercise of the Option at a time when there is
        not in
        effect a registration statement under the Securities Act of 1933, as amended
        (the “Securities Act”), relating to the shares of Common Stock issuable upon
        exercise of the Option, the Committee in its discretion may, as a condition
        to
        the exercise of the Option, require the Optionee (i) to execute an Investment
        Representation Statement substantially in the form set forth in Exhibit
        B
        hereto
        and (ii) to make such other representations and warranties as are deemed
        appropriate by counsel to the Corporation. 

       

      (c) Stock
        certificates representing shares of Common Stock acquired upon the exercise
        of
        Options that have not been registered under the Securities Act shall, if
        required by the Committee, bear an appropriate restrictive legend referring
        to
        the Securities Act. No shares of Common Stock shall be issued and delivered
        upon
        the exercise of the Option unless and until the Corporation and/or the Optionee
        shall have complied with all applicable Federal or state registration, listing
        and/or qualification requirements and all other requirements of law or of
        any
        regulatory agencies having jurisdiction.

       

      9.  No
        Evidence of Employment or Service.
        Nothing
        contained in the Plan or this Agreement shall confer upon the Optionee any
        right
        to continue in a Business Relationship with the Corporation, its parent or
        any
        of its subsidiaries or interfere in any way with the right of the Corporation,
        its parent or its subsidiaries (subject to the terms of any separate agreement
        to the contrary) to terminate the Optionee’s Business Relationship or to
        increase or decrease the Optionee’s compensation at any time.

       

      10. Restriction
        on Transfer.
        The
        Option may not be transferred, pledged, assigned, hypothecated or otherwise
        disposed of in any way by the Optionee, except by will or by the laws of
        descent
        and distribution, and may be exercised during the lifetime of the Optionee
        only
        by the Optionee. If the Optionee dies, the Option shall thereafter be
        exercisable, during the period specified in Section 4, by his executors or
        administrators to the full extent to which the Option was exercisable by
        the
        Optionee at the time of his death. The Option shall not be subject to execution,
        attachment or similar process. Any attempted assignment, transfer, pledge,
        hypothecation or other disposition of the Option contrary to the provisions
        hereof, and the levy of any execution, attachment or similar process upon
        the
        Option, shall be null and void and without effect. The words “transfer” and
“dispose” include without limitation the making of any sale, exchange,
        assignment, gift, security interest, pledge or other encumbrance, or any
        contract therefor, any voting trust or other agreement or arrangement with
        respect to the transfer of any interest, beneficial or otherwise, in the
        Option,
        the creation of any other claim thereto or any other transfer or disposition
        whatsoever, whether voluntary or involuntary, affecting the right, title,
        interest or possession with respect to the Option.

      
        
          
          

        

        
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      11. Specific
        Performance.
        Optionee expressly agrees that the Corporation will be irreparably damaged
        if
        the provisions of this Agreement and the Plan are not specifically enforced.
        Upon a breach or threatened breach of the terms, covenants and/or conditions
        of
        this Agreement or the Plan by the Optionee, the Corporation shall, in addition
        to all other remedies, be entitled to a temporary or permanent injunction,
        without showing any actual damage, and/or decree for specific performance,
        in
        accordance with the provisions hereof and thereof. The Board of Directors
        shall
        have the power to determine what constitutes a breach or threatened breach
        of
        this Agreement or the Plan. Any such determinations shall be final and
        conclusive and binding upon the Optionee.

       

      12. Disqualifying
        Dispositions.
        To the
        extent the Option is intended to be an Incentive Stock Option, and if the
        Optioned Shares are disposed of within two years following the date of this
        Agreement or one year following the issuance thereof to the Optionee (a
“Disqualifying Disposition”), the Optionee shall, immediately prior to such
        Disqualifying Disposition, notify the Corporation in writing of the date
        and
        terms of such Disqualifying Disposition and provide such other information
        regarding the Disqualifying Disposition as the Corporation may reasonably
        require.

       

      13. Notices.
        All
        notices or other communications which are required or permitted hereunder
        shall
        be in writing and sufficient if (i)
        personally delivered or sent by telecopy, (ii)
        sent by
        nationally-recognized overnight courier or (iii)
        sent by
        registered or certified mail, postage prepaid, return receipt requested,
        addressed as follows:

       

      if
        to the
        Optionee, to the address (or telecopy number) set forth on the Notice of
        Grant;
        and

      

      if
        to the
        Corporation, to its principal executive office as specified in any report
        filed
        by the Corporation with the Securities and Exchange Commission or to such
        address as the Corporation may have specified to the Optionee in writing,
        Attention: Corporate Secretary.

      

      or
        to
        such other address as the party to whom notice is to be given may have furnished
        to the other party in writing in accordance herewith. Any such communication
        shall be deemed to have been given (i) when delivered, if personally delivered,
        or when telecopied, if telecopied, (ii) on the first Business Day (as
        hereinafter defined) after dispatch, if sent by nationally-recognized overnight
        courier and (iii) on the third Business Day following the date on which the
        piece of mail containing such communication is posted, if sent by mail. As
        used
        herein, “Business Day” means a day that is not a Saturday, Sunday or a day on
        which banking institutions in the city to which the notice or communication
        is
        to be sent are not required to be open. 

      

      14. No
        Waiver.
        No
        waiver of any breach or condition of this Agreement shall be deemed to be
        a
        waiver of any other or subsequent breach or condition, whether of like or
        different nature.

       

      15. Optionee
        Undertaking.
        The
        Optionee hereby agrees to take whatever additional actions and execute whatever
        additional documents the Corporation may in its reasonable judgment deem
        necessary or advisable in order to carry out or effect one or more of the
        obligations or restrictions imposed on the Optionee pursuant to the express
        provisions of this Agreement.

       

      
        
          
          

        

        
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      16. Modification
        of Rights.
        The
        rights of the Optionee are subject to modification and termination in certain
        events as provided in this Agreement and the Plan.

       

      17. Governing
        Law.
        This
        Agreement shall be governed by, and construed in accordance with, the laws
        of
        the State of Nevada applicable to contracts made and to be wholly performed
        therein, without giving effect to its conflicts of laws principles.

       

      18. Counterparts;
        Facsimile Execution.
        This
        Agreement may be executed in one or more counterparts, each of which shall
        be
        deemed to be an original, but all of which together shall constitute one
        and the
        same instrument. Facsimile execution and delivery of this Agreement is legal,
        valid and binding execution and delivery for all purposes.

       

      19. Entire
        Agreement.
        This
        Agreement (including the Notice of Grant) and the Plan, and, upon execution,
        the
        Notice and Investment Representation Statement, constitute the entire agreement
        between the parties with respect to the subject matter hereof, and supersede
        all
        previously written or oral negotiations, commitments, representations and
        agreements with respect thereto.

       

      20. Severability.
        In the
        event one or more of the provisions of this Agreement should, for any reason,
        be
        held to be invalid, illegal or unenforceable in any respect, such invalidity,
        illegality or unenforceability shall not affect any other provisions of this
        Agreement, and this Agreement shall be construed as if such invalid, illegal
        or
        unenforceable provision had never been contained herein. 

       

      21. WAIVER
        OF JURY TRIAL.
        THE
        OPTIONEE HEREBY EXPRESSLY, IRREVOCABLY AND UNCONDITIONALLY WAIVES TRIAL BY
        JURY
        IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AND FOR ANY
        COUNTERCLAIM THEREIN.

      

      [signature
        page follows]

      
        
          
          

        

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

        

        NOVASTAR
          RESOURCES LTD.

         

        

        By: /s/
          Seth Grae                

        Seth
          Grae

        President
          & Chief Executive Officer

        

        

        Optionee:

        

        

        __/s/
          George Crowley______________

        George
          D.
          Crowley, Jr.

        

        

      

      
        
          
          

        

        
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      NOTE
        RE: EXHIBITS

      

      

      EXHIBITS
        A AND B ARE TO BE SIGNED

      

      WHEN
        OPTIONS ARE EXERCISED,

      

      NOT
        WHEN OPTION AGREEMENT IS SIGNED.

      

      
        
          
          

        

        
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      EXHIBIT
        A

      

      NOVASTAR
        RESOURCES LTD.

      

      2006
        STOCK PLAN

      

      EXERCISE
        NOTICE

      

      Novastar
        Resources Ltd.

      Attention:
        Chief Executive Officer

      

      1. Exercise
        of Option.
        Effective as of today, _______________________, 20__ , the undersigned (the
        “Optionee”) hereby elects to exercise the Optionee’s option to purchase
        ________________ shares of the Common Stock (the “Shares”) of Novastar Resources
        Ltd. (the “Corporation”) under and pursuant to the 2006 Stock Plan (the “Plan”)
        and the Stock Option Agreement dated _________ (the “Stock Option Agreement”),
        with the purchase of the Shares to be consummated on ______________ ___,
        ____
        (the “Effective Date”), which date is prior to the termination of the Option and
        no later than 30 days from the date of delivery of this Notice.

      

      2. Representations
        of the Optionee.
        The
        Optionee acknowledges that the Optionee has received, read and understood
        the
        Plan and the Stock Option Agreement and agrees to abide by and be bound by
        their
        terms and conditions. 

      

      3. Rights
        as Shareholder; Shares Subject to Stockholders Agreement.
        Until
        the stock certificate evidencing such Shares is issued (as evidenced by the
        appropriate entry on the books of the Corporation or of a duly authorized
        transfer agent of the Corporation), no right to vote or receive dividends
        or any
        other rights as a stockholder shall exist with respect to the Shares,
        notwithstanding the exercise of the Option. The Corporation shall issue (or
        cause to be issued) such stock certificate promptly after the Effective Date,
        provided the applicable price has been paid and the required documents have
        been
        received. No adjustment will be made for a dividend or other right for which
        the
        record date is prior to the date the stock certificate is issued, except
        as
        otherwise provided in the Plan. Unless waived by the Corporation in writing,
        the
        Shares shall automatically become subject to the terms and conditions of
        any
        stockholders agreement or similar agreement to which a majority of the
        outstanding capital stock of the Corporation is subject at the time of exercise
        and the Optionee shall sign as a condition to the issuance of the Shares
        such
        joinder agreement, signature pages or other documents in order to evidence
        the
        Optionee’s agreement to be so bound.

      

      4. Tax
        Consultation.
        The
        Optionee understands that the Optionee may suffer adverse tax consequences
        as a
        result of the Optionee’s purchase or disposition of the Shares. The Optionee
        represents that the Optionee has consulted with any tax consultants the Optionee
        deems advisable in connection with the purchase or disposition of the Shares
        and
        that the Optionee is not relying on the Corporation for any tax
        advice.

      

      5. Successors
        and Assigns.
        The
        Corporation may assign any of its rights under the Stock Option Agreement
        to
        single or multiple assignees (who may be stockholders, officers, directors,
        employees or consultants of the Corporation), and this Agreement shall inure
        to
        the benefit of the successors and assigns of the Corporation. Subject to
        the
        restrictions on transfer set forth in the Stock Option Agreement, this Agreement
        shall be binding upon the Optionee and his or her heirs, executors,
        administrators, successors and assigns.

      
        
          
          

        

        
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      6. Interpretation.
        Any
        dispute regarding the interpretations of this Agreement shall be submitted
        by
        the Optionee or by the Corporation forthwith to the Committee, which shall
        review such dispute at its next regular meeting. The resolution of such a
        dispute by the Committee shall be final and binding on the Corporation and
        on
        the Optionee.

      

      7. Governing
        Laws: Severability.
        This
        Agreement shall be governed by, and construed in accordance with, the laws
        of
        the State of New York applicable to contracts made and to be wholly performed
        therein, without giving effect to its conflicts of laws principles. Should
        any
        provision of this Agreement be determined by a court of law to be illegal
        or
        unenforceable, the other provisions shall nevertheless remain effective and
        shall remain enforceable.

      

      8. Notices.
        Any
        notice required or permitted hereunder shall be given in writing and shall
        be
        deemed effectively given if given in the manner specified in the Stock Option
        Agreement.

      

      9. Further
        Instruments.
        The
        parties agree to execute such further instruments and to take such further
        action as may be reasonably necessary to carry out the purposes and intent
        of
        this Agreement.

      

      10. Delivery
        of Payment.
        The
        Optionee herewith delivers to the Corporation the full Option Price for the
        Shares.

      

      11. Entire
        Agreement.
        The
        Plan, the Notice of Grant, and the Stock Option Agreement are incorporated
        herein by reference. This Agreement, the Plan, the Notice of Grant, the Stock
        Option Agreement, and the Investment Representation Statement constitute
        the
        entire agreement of the parties and supersede in their entirety all prior
        undertakings and agreements of the Corporation and the Optionee with respect
        to
        the subject matter hereof.

      

      Submitted
        by:     Accepted
        by:

      

      OPTIONEE:     NOVASTAR
        RESOURCES LTD.

      

                                                 &am
        p;#1 60;        By:______________________________

      

      ___________________________     Its:______________________________

      Name:
        George D. Crowley, Jr.

      

      
        
          
          

        

        
          11

          
            

          

        

        
          
          

        

      

      EXHIBIT
        B

      

      2006
        STOCK PLAN

      

      INVESTMENT
        REPRESENTATION STATEMENT

      

      OPTIONEE  : George
        D.
        Crowley, Jr.

      

      CORPORATION     : NOVASTAR
        RESOURCES LTD.

      

      SECURITY  : Common
        Stock

      

      AMOUNT  : ___________________________________

      

      DATE      : ___________________________________

      

      In
        connection with the purchase of the above-listed Securities, the undersigned
        Optionee represents to the Corporation the following:

      

      (a) The
        Optionee is aware of the Corporation’s business affairs and financial condition
        and has acquired sufficient information about the Corporation to reach an
        informed and knowledgeable decision to acquire the Securities. The Optionee
        is
        acquiring these Securities for investment for the Optionee’s own account only
        and not with a view to, or for resale in connection with, a “distribution”
thereof within the meaning of the Securities Act of 1933, as amended (the
        “Securities Act”).

      

      (b) The
        Optionee acknowledges and understands that the Securities constitute “restricted
        securities” under the Securities Act and have not been registered under the
        Securities Act in reliance upon a specific exemption therefrom, which exemption
        depends upon, among other things, the bona fide nature of the Optionee’s
        investment intent as expressed herein. In this connection, the Optionee
        understands that, in the view of the Securities and Exchange Commission,
        the
        statutory basis for such exemption may be unavailable if the Optionee’s
        representation was predicated solely upon a present intention to hold these
        Securities for the minimum capital gains period specified under tax statutes,
        for a deferred sale, for or until an increase or decrease in the market price
        of
        the Securities, or for a period of one year or any other fixed period in
        the
        future. The Optionee further understands that the Securities must be held
        indefinitely unless they are subsequently registered under the Securities
        Act or
        an exemption from such registration is available. The Optionee further
        acknowledges and understands that the Corporation is under no obligation
        to
        register the Securities. The Optionee understands that the certificate
        evidencing the Securities will be imprinted with a legend which prohibits
        the
        transfer of the Securities unless they are registered or such registration
        is
        not required in the opinion of counsel satisfactory to the Corporation and
        other
        legends required under the applicable state or federal securities
        laws.

      

      

      Signature
        of Optionee: _____________________________

      

      Date:__________________

      

      
        
          
          

        

        
          12PURCHASE
      AGREEMENT

    

    PURCHASE
      AGREEMENT (this “Agreement”)
      dated
      as of May 5, 2006 between SKS VENTURES, LLC, a Colorado limited liability
      company ("Buyer"),
      and
      EQUI-MOR HOLDINGS, INC., a Nevada corporation ("Seller").

    

    R
      E C I T A L S:

    

    Seller
      owns 100% of the outstanding limited liability company interests (the
“Interests”)
      of ABS
      School Services, LLC (the “Company”),
      which
      owns and operates a financing and management business services business for
      charter schools (the "Business");
      and

    

    Seller
      desires to sell to Buyer the Interests, and Buyer desires to purchase the
      Interests from Seller, subject to the terms and conditions set forth in this
      Agreement.

    

    In
      consideration of the premises and mutual covenants contained in this Agreement,
      the parties agree as follows (capitalized terms not otherwise defined are
      defined in Exhibit
      A):

    

    SECTION
      1

    PURCHASE
      AND SALE

    

    1.1 
Sale
      and Purchase of Interests.
      Subject
      to and upon the terms and conditions contained herein, at the Closing (as
      hereinafter defined), Seller shall sell to Buyer, and Buyer shall purchase
      from
      Seller, the Interests. 

    

    1.2 
Closing.
      Subject
      to the terms hereof, the closing of the transactions contemplated hereby (the
      "Closing")
      shall
      occur on or about May 5, 2006 (the "Closing
      Date")
      at
      such place or in such manner as shall be mutually agreed by the
      parties.

    

    1.3 
Purchase
      Price.
      The
      aggregate consideration to be paid by Buyer to Seller for the Interests shall
      be
      $7,370,000 (the “Purchase
      Price”).
      The
      Purchase Price shall be paid in cash, including $4,000,000 in proceeds from
      a
      loan to Buyer by Matrix Capital Bank (the “Bank”),
      an
      affiliate of Seller, pursuant to which the Interests will be pledged to the
      Bank. Notwithstanding the purchase of the Interests by Buyer, Buyer and Seller
      agree that Seller will remain responsible for the Excluded
      Liabilities.

    

    SECTION
      2

    REPRESENTATIONS
      AND WARRANTIES OF SELLER

    

    Except
      as
      set forth on the Disclosure Schedules attached hereto, Seller hereby represents
      and warrants to Buyer as of the date hereof and as of the Closing Date as
      follows: 

     

    2.1 
Organization,
      Power and Authority of Seller.
      Seller
      is a corporation duly organized and legally existing in good standing under
      the
      laws of Nevada, and has full power and authority to carry on its business as
      now
      being conducted. Seller is in good standing in each jurisdiction in which its
      business or property would require that it be qualified, except as would not
      reasonably be expected to have a Material Adverse Effect. The execution,
      delivery and performance of this Agreement and the consummation of the
      transactions contemplated hereby have been duly authorized by all necessary
      corporate action on the part of Seller. 

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    2.2 
The
      Companies.
      Seller
      owns the Interests, which constitute 100% of the outstanding limited liability
      company membership interests of the Company. The Company owns 100% of the
      outstanding limited liability company membership interests of New Century
      Educational Management Services, LLC (“NCEMS",
      and
      together with the Company, the “Companies”).
      Each
      of the Companies is a limited liability company, duly organized and legally
      existing in good standing under the laws of Arizona, and has full power and
      authority to carry on its businesses as now being conducted. Each of the
      Companies is in good standing in each jurisdiction where its business or
      property would require that it be qualified, except as would not reasonably
      be
      expected to have a Material Adverse Effect. 

    

    2.3 
Binding
      Obligation; Non-contravention.
      This
      Agreement has been duly executed and delivered by Seller and is the valid and
      binding obligation of Seller enforceable in accordance with its terms. Except
      as
      described in Schedule 2.3 to this Agreement, neither the execution and delivery
      of this Agreement by Seller nor the consummation of the transactions
      contemplated hereby will: (i) conflict with or violate any provisions of
      Seller's Articles of Incorporation or bylaws or either of the Companies’
Articles of Organization or operating agreements or any decree or order of
      any
      court or administrative or other governmental body which is applicable to,
      binding upon or enforceable against Seller or any of the Companies; or (ii)
      result in a breach of, constitute a default under, result in the acceleration
      of, create in any party the right to accelerate, terminate, modify or cancel,
      or
      require any notice under, any Contract that is binding upon or enforceable
      against Seller or either of the Companies except, in the case of this clause
      (ii), as would not reasonably be expected to have a Material Adverse Effect.
      Except as set forth in Schedule 2.3, no permit, consent, approval or
      authorization of, or declaration to or filing with, any regulatory or other
      governmental authority is required in connection with the execution and delivery
      of this Agreement by Seller and the consummation of the transactions
      contemplated hereby.

    

    2.4 
Ownership
      of Interests and Assets.
      At
      Closing Seller shall have good and valid title to the Interests, free and clear
      of all Encumbrances, except for restrictions imposed by applicable state and
      federal securities laws. At Closing, Buyer shall acquire 100% of the outstanding
      equity interests of the Company. Each of the Companies has good and valid title
      to the assets listed on Schedule 2.4, free and clear of all Encumbrances other
      than those disclosed on Schedule 2.4. The Companies' fixed assets are in good
      operating condition, normal wear and tear excepted. 

    

    2.5 
Valid
      Transfer of Interests.
      At
      Closing, the Interests, when sold and delivered to Buyer in accordance with
      the
      terms of this Agreement for the consideration expressed herein, will be sold
      and
      transferred in compliance with or pursuant to an exemption from registration
      or
      qualification under all applicable federal and state securities
      laws.

    

    2.6 
Financial
      Statements of the Company.
      Seller
      has previously delivered to Buyer the Companies’ combined loan trial balance as
      of March 31, 2006 (the “Loan
      Trial Balance”),
      the
      following financial statements of the Companies (the “Financial
      Statements”)
      and a
      pro forma balance sheet of the Companies at March 31, 2006 giving effect to
      the transactions contemplated hereby (the "Pro Forma Balance Sheet"):

    

    
      
        2

      

      
         

        
          

        

      

      
         

      

    

    (i)  
      unaudited
      balance sheets of the Companies at December 31, 2005; 

    

    (ii)  
      unaudited
      income statements of the Companies for the twelve-month period ended at December
      31, 2005;

    

    (iii)  
      unaudited
      balance sheets of the Companies at March 31, 2006; and

    

    (iv)  
      unaudited
      income statements of the Companies for the three-month period ended at March
      31,
      2006. 

    

    The
      Financial Statements, the Loan Trial Balance and the Pro Forma Balance Sheet
      are
      attached hereto as Schedule 2.6 of the Disclosure Schedules. Except as set
      forth
      in Schedule 2.6, the Financial Statements (a) have been prepared consistently
      with the books and records of Matrix Bancorp Inc., Seller and the Companies,
      (b)
      fairly present the financial position of the Companies as of the dates specified
      and the results of operations of the Companies in all material respects for
      the
      periods covered thereby, and (c) have been prepared in conformity with generally
      accepted accounting principles applied on a consistent basis other than the
      lack
      of footnotes. Except as set forth in Schedule 2.6, the Loan Trial Balance and
      the Pro Forma Balance Sheet have been prepared consistently with the books
      and
      records of Matrix Bancorp Inc., Seller and the Companies. The unaudited balance
      sheet of the Company at March 31, 2006 (including the notes pertaining thereto,
      if any) included in Schedule 2.6 is hereafter referred to as the "Last
      Balance Sheet."

    

    2.7 
Liabilities
      of the Company.
      None of
      the Companies have liabilities or obligations, direct or indirect, asserted
      or
      unasserted, known or unknown, accrued or unaccrued, absolute, contingent or
      otherwise, in each case greater than $25,000, except: (i) to the extent
      reflected or taken into account in determining net worth in the Last Balance
      Sheet and not heretofore paid or discharged or classified as Excluded
      Liabilities and (ii) normal liabilities incurred in the ordinary course of
      business, consistent with prior practice, since the date of the Last Balance
      Sheet. 

    

    2.8 
Contracts.
      

    

    (a)  
      To
      Seller’s knowledge, Schedule 2.8 lists all Contracts (other than those
      referenced on Schedule 2.4 or reflected in the Financial Statements or the
      Loan
      Trial Balance) which, following Closing: 

    

    (i)  
      are
      with
      any present or former stockholder, director, officer, employee, partner or
      consultant of any of the Companies or any Affiliate thereof;

    

    (ii)  
      provide
      for non-competition agreements which restrict any of the Companies from doing
      business in a specified area or geographic location; 

    

    (iii)  
      relate
      to
      the hiring or leasing of employees outside of the ordinary course of business;
      or

    

    
      
        3

      

      
         

        
          

        

      

      
         

      

    

    (iv)  
      any
      otherwise material to either of the Companies and outside of the ordinary course
      of business.

    

    (b)  
      To
      Seller’s knowledge, neither of the Companies is in default in any material
      respect under any material Contract.

    

    (c)  
      To
      Seller’s knowledge Neither of the Companies has received any notice from, or
      given any notice to, any other party indicating that one of the Companies or
      such other party, as the case may be, is in default under any material Contract.
      

    

    (d)  
      To
      Seller's knowledge, none of the other parties to any material Contract is in
      default in any material respect thereunder.

    

    (e)  
      To
      Seller's knowledge, each of the material Contracts is enforceable against the
      other parties thereto in accordance with the terms thereof. 

    

    (f)  
      For
      purposes of this Section 2.8, unwritten employment arrangements with employees
      in the ordinary courses of business are not Contracts required to be listed
      on
      Schedule 2.8. 

    

    2.9 
Licenses
      and Permits of the Companies.
      The
      Companies possess all licenses and other required governmental or official
      approvals, permits or authorizations, except where the failure to possess would
      not reasonably be expected to have a Material Adverse Effect. All such licenses,
      approvals, permits and authorizations are in full force and effect, the
      Companies are in compliance with their requirements, and no proceeding is
      pending or, to the knowledge of Seller, threatened to suspend, revoke or amend
      any of them. To Seller’s knowledge, except as set forth in Schedule 2.9, none of
      such licenses, approvals, permits and authorizations are or will be impaired
      or
      in any way affected by the execution and delivery of this Agreement or the
      consummation of the transactions contemplated hereby.

    

    2.10 
Litigation.
      Except
      as set forth in Schedule 2.10, there are no actions, suits, claims, governmental
      investigations, audits, or arbitration proceedings pending or, to the knowledge
      of Seller, threatened against or affecting Seller or either of the Companies
      or
      any of their assets or properties and, to the knowledge of Seller, there is
      no
      basis for any of the foregoing. There are no outstanding orders, decrees or
      stipulations issued by any federal, state, local or foreign judicial or
      administrative authority in any proceeding to which the Seller or either of
      the
      Companies are or were a party. 

    

    2.11 
No
      Material Adverse Change.
      Since
      the date of the Last Balance Sheet, there have been no changes in the business
      or properties of the Companies, or in their financial condition, other than
      changes occurring in the ordinary course of business that in the aggregate
      would
      not reasonably be expected to have a Material Adverse Effect. There is not,
      to
      the knowledge of Seller, any threatened or prospective event or condition of
      any
      character whatsoever that could materially and adversely affect the assets,
      properties, business, financial condition or results of operations of the
      Companies taken as a whole. 

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    2.12 
Absence
      of Certain Acts or Events.
      Since
      the date of the Last Balance Sheet, other than those distributions made and
      actions taken by the Companies in contemplation of this Agreement, which are
      listed in Section 5.2 of this Agreement, neither of the Companies has: (i)
      authorized or issued any additional equity interests or other securities; (ii)
      made any distributions with respect to its outstanding membership interests
      or
      purchased or redeemed any of its membership interests or other securities;
      (iii)
      sold, leased, transferred or assigned any of its assets other than in the
      ordinary course of business; (iv) other than in the ordinary course of business,
      incurred any material obligations or liabilities (including any indebtedness)
      or
      entered into any material Contract, obligation or other transaction, except
      for
      this Agreement and the transactions contemplated hereby; (v) materially changed
      any of its Tax or accounting polices; (vi) increased the compensation payable
      to
      any of its respective employees other than in the ordinary course of business;
      (vii) experienced any material damage, destruction or loss (whether or not
      covered by insurance); or (viii) otherwise taken any action outside the ordinary
      course of business that had a Material Adverse Effect on either of the
      Companies. 

    

    2.13 
Employees.
      

    

    (a)  
      No
      current officer or employee of either of the Companies is a party to any written
      employment agreement or union or collective bargaining agreement. No union
      has
      been certified or recognized as the collective bargaining representative of
      any
      of such employees or has attempted to engage in negotiations with either of
      the
      Companies regarding terms and conditions of employment. No unfair labor practice
      charge, work stoppage, picketing, harassment or other such activity relating
      to
      labor matters has occurred during the past five years or is pending. To Seller's
      knowledge, there are no current or threatened attempts to organize or establish
      any labor union to represent any employees of the Companies. Each of the
      Companies is in compliance in all material respects with all requirements of
      Laws governing employee relations that may be applicable to the Business,
      including anti-discrimination Laws, immigration, wage and hour Laws, labor
      relations Laws and occupational safety and health Laws, and no suits, charges
      or
      administrative proceedings relating to any such Law are pending or, to Seller's
      knowledge, have been threatened. 

    

    (b)  
      Schedule
      2.13 sets out a list of all salaried employees of the Companies, together with
      their current salary and bonus paid, if any, for 2005. No outstanding offer
      of
      employment has been made by either of the Companies to any Person nor has any
      Person accepted an offer of employment made by either of the Companies but
      who
      has not yet commenced such employment. All Persons whom the Companies have
      engaged as independent contractors are properly classified as independent
      contractors for Tax purposes.

    

    2.14 
Employee
      Benefits.
      

    

    (a)  
      True
      and
      correct copies or summaries of existing employee benefit plans (the
      "Benefit
      Plans")
      generally provided by the Companies to their existing employees have been
      previously provided to Buyer and are listed in Schedule 2.14 of the Disclosure
      Schedules. Each of the Benefit Plans complies in form in all material respects
      and has been administered in all material respects in accordance with all
      applicable requirements of Law.

    

    (b)  
      There
      is
      no pending or, to the knowledge of Seller, threatened claim which alleges any
      violation of any Benefit Plan by any employee or any participant or beneficiary
      against any Benefit Plan.

    

    
      
        5

      

      
         

        
          

        

      

      
         

      

    

    (c)  
      All
      contributions required to have been made by the Companies or any of their
      Affiliates to any Benefit Plan under its terms or pursuant to any Law have
      been
      made. There are no unfunded benefit obligations arising in any jurisdiction
      that
      are not accounted for by reserves shown on the Last Balance Sheet.

    

    (d)  
      All
      accrued obligations of the Companies, whether arising by operation of law,
      by
      contract, or by past custom, for payments to trust or other funds or to any
      governmental body, with respect to unemployment compensation, social security,
      or any other benefits for employees of any of the Companies as of the date
      hereof, have been paid, or adequate accruals therefore have been provided on
      the
      Last Balance Sheet, and none of the foregoing has been rendered. Seller shall
      be
      responsible for funding the employer contribution portion of each of the
      Companies’ employees participation in the Matrix Bancorp, Inc. 401(k) Plan
      accrued through the Closing Date. 

     

    2.15 
Compliance
      with Laws.
      The
      Companies have not made any kickback, bribe, or payment to any person or entity
      in violation of any federal, state, local or foreign law, rule or regulation,
      directly or indirectly, for referring, recommending or arranging business or
      customers with, to or for the Companies. The Companies are in material
      compliance (without obtaining waivers, variances or extensions) with all
      federal, state, local and foreign laws, rules and regulations that relate to
      the
      operations of the Business.

    

    2.16 
Real
      Property. 

    

    (a)  
      Schedule
      2.16 of the Disclosure Schedules sets forth a complete and correct list of
      all
      real properties or premises that are owned, leased or used in whole or in part
      by any of the Companies (the "Real
      Property").
      The
      properties listed on Schedule 2.16 of the Disclosure Schedules constitute all
      the real properties utilized by any of the Companies, including certain
      properties that are subject to lease purchase arrangements with charter schools
      that were conveyed by Seller to the Company prior to Closing in contemplation
      of
      the consummation of this Agreement (the “Lease
      Purchase Properties”).
      Complete and correct copies of all leases (the "Leases")
      concerning such Real Property, including the Leases covering the Lease Purchase
      Properties (the “Lease
      Purchase Contracts”),
      have
      been delivered to Buyer. 

     

    (b)  
      Other
      than the Lease Purchase Contracts, each Lease is valid and binding, as between
      one of the Companies and the other party or parties thereto, and one or more
      of
      the Companies is a tenant or possessor in good standing thereunder, free of
      any
      material default on the part of the Companies and, to Seller's knowledge, free
      of any default on the part of the lessors thereunder, and quietly enjoys the
      premises provided for therein. 

    

    (c)  
      Each
      Lease Purchase Contract is valid and binding, as between one of the Companies
      and the other party or parties thereto, free of any material default on the
      part
      of the Companies and, to Seller's knowledge, free of any default on the part
      of
      the lessees thereunder.

    

    2.17 
Intellectual
      Property. 

    

    (a)  
      All
      Contracts involving consideration with a value of $25,000 or more annually
      (other than those terminable with no more than 30 days notice without penalty
      or
      other cost) to which either of the Companies is a party or by which either
      of
      the Companies is bound relating to any Proprietary Rights, except for any
      perpetual, paid-up royalty and transferable rights licensed to any of the
      Companies for off-the-shelf Software, are included in Schedule 2.8. To Seller’s
      knowledge, neither of the Companies has received any written notice, or
      otherwise is aware of, any outstanding or threatened disputes, disagreements
      or
      breaches with respect to any such Contract. The Companies do not own, license,
      use or rely upon any patents or trademarks.

    

    
      
        6

      

      
         

        
          

        

      

      
         

      

    

    (b)  
      To
      Seller's knowledge, the operation of the Business as currently conducted has
      not, does not and will not, when conducted by Buyer in substantially the same
      manner following the Closing, interfere with, infringe, misappropriate or
      violate any Proprietary Rights of any third party or constitute unfair
      competition or trade practices under the laws of any jurisdiction. To Seller’s
      knowledge, neither of the Companies has received notice from any other Person
      claiming that the operation of the business or any Proprietary Right used by
      any
      of the Companies interferes with, infringes, misappropriates or violates any
      Proprietary Rights of any third party or constitutes unfair competition or trade
      practices under the laws of any jurisdiction.

     

    2.18 
Affiliate
      Interests.
      To
      Seller’s knowledge, neither of the Companies is a party to any transaction
      outside of the ordinary course of business with (i) any employee, officer or
      director of one of the Companies, (ii) any relative of any such employee,
      officer or director, or (iii) any Person that, directly or indirectly, is
      controlled by or under common control with the Company or with any such
      employee, officer, director or relative.

     

    2.19 
Broker's
      or Finder's Fee.
      Neither
      Seller nor any of its Affiliates have employed, or are liable for the payment
      of
      any fee to, any finder, broker, consultant or similar person in connection
      with
      the transactions contemplated under this Agreement.

    

    2.20 
Effect
      of Buyer’s Knowledge.
      Seller
      shall not be deemed to have violated any of the foregoing representations and
      warranties or to have breached this Agreement if and to the extent that, at
      the
      time of execution of this Agreement, Buyer knew of the information that would
      otherwise constitute a violation of such representation or warranty.

    

    2.21 
Loan
      Servicing. Prior
      to
      Closing, (a) the Loans reflected in the Loan Trial Balance have been originated
      and serviced by the Company in accordance with all applicable laws, rules and
      regulations and (b) the Companies performed their obligations and
      responsibilities under their current and past service agreements in accordance
      with the terms of such agreements and applicable law. 

    

    SECTION
      3

    REPRESENTATIONS
      AND WARRANTIES OF BUYER

    

    Except
      as
      set forth on the Disclosure Schedules attached hereto specifically identifying
      the Section hereof to which each such exception relates, Buyer hereby represents
      and warrants to Seller as of the Closing Date as follows:

    

    3.1 
Organization,
      Power and Authority of Buyer.
      Buyer
      is a limited liability company duly organized and legally existing in good
      standing under the laws of Colorado, and has full limited liability company
      power and authority and all licenses and permits necessary to 

     

    
      
        7

      

      
         

        
          

        

      

      
         

      

    

    own
      or
      lease its properties and to carry on its business as it is now being conducted.
      Buyer is in good standing in each jurisdiction in which its business or property
      is such as to require that it be thus qualified, except as would not reasonably
      be expected to have a Material Adverse Effect. The execution, delivery and
      performance of this Agreement and the consummation of the transactions
      contemplated hereby have been duly authorized by all necessary limited liability
      company action of Buyer.

    

    3.2 
Binding
      Obligation; Noncontravention.
      This
      Agreement has been duly executed and delivered by Buyer and is a valid and
      binding obligation of Buyer, enforceable in accordance with its terms. Neither
      the execution and delivery of this Agreement by Buyer nor the consummation
      of
      the transactions contemplated hereby will: (i) conflict with or violate any
      provisions of Buyer's Articles of Organization or operating agreement or of
      any
      decree or order of any court or administrative or other governmental body which
      is applicable to, binding upon or enforceable against Buyer; or (ii) result
      in a
      breach of, constitute a default under, result in the acceleration of, create
      in
      any party the right to accelerate, terminate, modify or cancel, or require
      any
      notice under, any mortgage, contract, agreement, indenture or other instrument
      which is binding upon or enforceable against Buyer. No permit, consent, approval
      or authorization of, or declaration to or filing with, any regulatory or other
      governmental authority is required in connection with the execution and delivery
      of this Agreement by Buyer and the consummation of the transactions contemplated
      hereby.

    

    3.3 
Investment
      Representations.
      

    

    (a)  
      Buyer
      is
      an "accredited investor" as such term is defined in Rule 501(a) of Regulation
      D
      under the Securities Act of 1933 (the "Securities
      Act").

    

    (b)  
      Buyer
      is
      acquiring the Interests for its own account for investment and not with a view
      to, or for sale in connection with, any distribution thereof, nor with any
      present intention of distributing or selling the Interests.

    

    (c)  
      Buyer
      understands that the securities being sold hereby have not been registered
      under
      the Securities Act, or applicable state securities laws, and are being issued
      in
      reliance on exemptions from the registration requirements of Section 5 of the
      Securities Act and in reliance on exemptions from the registration requirements
      of certain state securities laws. Because the Interests have not been registered
      under the Securities Act or applicable state securities laws, the Interests
      may
      not be re-offered or resold except through a valid and effective registration
      statement or pursuant to a valid exemption from the registration requirements
      under the Securities Act and applicable state securities laws. 

    

    (d)  
      Buyer
      acknowledges that, since the execution of April 21, 2006 letter of intent
      between Buyer and Seller relating to the transactions to be effected by this
      Agreement, Buyer and its managers, officers, employees, agents, and
      representatives have been afforded reasonable access, during normal business
      hours and upon reasonable notice, to the personnel, properties, books, and
      records of the Companies. 

    

    
      
        8

      

      
         

        
          

        

      

      
         

      

    

    SECTION
      4

    COVENANTS
      AND AGREEMENTS

    

    4.1 
Further
      Action; Commercially Reasonable Efforts.
      The
      parties agree to execute and deliver all further instruments, certificates
      and
      documents and to take such further action as may be reasonably necessary to
      more
      fully carry out the intent and the purposes of this Agreement. The parties
      shall
      use their respective commercially reasonable efforts to resolve such objections,
      if any, as may be asserted with respect to the transactions contemplated hereby
      under the laws, rules, guidelines or regulations of any governmental entity.
      

    

    4.2 
Notification
      of Certain Matters.
      Each
      party shall give prompt notice to the other party hereto of the occurrence
      or
      nonoccurrence of any event the occurrence or nonoccurrence of which would cause
      any representation or warranty of either party contained in this Agreement
      to be
      untrue or inaccurate in any material respect at the Closing or would cause
      any
      material failure of a party to comply with or satisfy any covenant, condition
      or
      agreement to be complied with or satisfied by it hereunder.

    

    4.3 
Access.
      If the
      Closing of the transactions contemplated by this Agreement do not occur
      immediately upon the execution hereof, then from the date of execution of this
      Agreement until the Closing, then Seller will, and will cause the Companies
      to,
      give Buyer and its managers, officers, employees, agents, and representatives
      reasonable access, during normal business hours and upon reasonable notice,
      to
      the personnel, properties, books, and records of the Companies; provided,
      however, that such access shall not unreasonably disrupt the normal operations
      of any of Seller or the Companies. Following the Closing, Buyer will, and will
      cause the Companies to, grant Seller and its officers, employees, agents, and
      representatives reasonable access, during normal business hours and upon
      reasonable notice, to the books and records of the Companies relating to the
      period of time that the Companies were owned by Seller, if and to the extent
      that information in such books and records is required for any Tax returns
      or
      filings or for any filings made by Matrix Bancorp, Inc. with the Securities
      and
      Exchange Commission or other securities regulators; provided, however, that
      such
      access shall not unreasonably disrupt the normal operations of any of Buyer
      or
      the Companies. 

    

    4.4 
Ordinary
      Conduct.
      If the
      Closing of the transactions contemplated by this Agreement do not occur
      immediately upon the execution hereof, then Seller will, from the date of
      execution of this Agreement until the Closing, cause the business of the
      Companies to be conducted in the ordinary course in substantially the same
      manner as presently conducted except as expressly contemplated otherwise by
      this
      Agreement.

    

    4.5 
Purchase
      Price Allocation.
      Buyer
      and Seller shall allocate the Purchase Price among the assets of the Companies
      in accordance with their respective fair market values, with the balance
      allocated to goodwill, substantially as set forth on Schedule 4.6 attached
      hereto, and the parties agree to adhere to such allocations for tax reporting
      purposes.

    

    4.6 
Taxes.
      Seller
      shall be responsible for the payment of all Taxes incurred by the Companies
      through the Closing Date, and Buyer shall be responsible for the payment of
      all
      Taxes incurred by the Companies following the Closing Date.

    

    
      
        9

      

      
         

        
          

        

      

      
         

      

    

    4.7 
Liabilities.
      To the
      extent possible, at Closing the Companies shall have distributed to Seller,
      and
      Seller shall have assumed, the Excluded Liabilities.

    

    4.8 
Office
      Space. Seller
      hereby leases to Buyer, for the continuing use of the Companies, the office
      space currently utilized by the Companies in Phoenix, Arizona for the period
      beginning immediately after the Closing Date until November 30, 2006 at a rental
      rate of $1 per month, with Buyer waiving any and all rights to holdover tenancy
      or other similar rights. 

    

    4.9 
Retention
      Bonuses. Seller
      agrees to contribute $10,000 toward retention bonuses paid by Buyer or the
      Companies to management employees of the Companies and to contribute up to
      an
      additional $30,000 to match contributions made by Buyer for such purpose.

    

    4.10 
St.
      Louis Properties. Buyer
      agrees that, following the Closing it will provide general oversight for
      Seller’s Linton and St. Boniface properties (the “St.
      Louis Properties”)
      and specified
      financial services for each of the St. Louis Properties, namely sublease
      negotiations, rent collection from subtenants and rent payment to the lessor
      for
      the St. Boniface property and lease negotiations, rent collection from tenants
      and remittance of such collections to Seller for the Linton property, together
      with such other management services as are expressly assumed in writing by
      Buyer, in exchange for a payment of $7,500 per calendar quarter, payable in
      arrears, commencing on June 30, 2006. Buyer shall not be required to provide
      any
      on-site property management or other similar services. The obligation of Buyer
      to provide these services to Seller may be terminated by either party upon
      60
      days notice to the other beginning 90 days after the date of this Agreement.
      Seller agrees that, if it closes a sale or other disposition of the Linton
      property that was initially presented by Buyer, Seller will pay to Buyer a
      structuring fee upon such closing in an amount to be negotiated between Buyer
      and Seller but not to be less than $250,000, provided, however, that nothing
      herein obligates Seller to accept or approve any sale or disposition proposed
      by
      Buyer and Seller reserves the right to require such terms, including but not
      limited to price, as Seller may deem appropriate, in its sole discretion.

    

    4.11 
Remarketing
      of Class A Pass-Through Certificates. Seller
      agrees to cause its Affiliate, First Matrix Investment Services Corp.
      (“First
      Matrix”),
      to
      continue to provide remarketing services with respect to the Class A
      Pass-Through Certificates as described in the Master Placement Agency and
      Remarketing Agreement of the First Matrix Charter School Trust II for a period
      of one year following the date hereof, for which First Matrix will
      continue to receive its annual fee of 12.5 basis points. Buyer or the Company
      may terminate the remarketing services at any time.

    

    4.12 
Sale
      Within First Year. If
      on or
      prior to the one year anniversary of this Agreement, Buyer or the Companies
      sell, transfer or assign, directly or indirectly, all or substantially all
      of
      the Interests, the Companies or the assets of the Companies, including a merger,
      membership interest exchange or other limited liability company level
      transaction (each of the foregoing, a “Sale”),
      in
      each case for a net sales price (the “Sale
      Price”)
      greater than the Purchase Price, Buyer shall pay to Seller 50% of the difference
      between the Sale Price and the Purchase Price (the “Margin”).
      Buyer
      shall pay this amount to Seller no later than five business days after the
      Sale.
      The Margin shall be adjusted for any assets or Interests excluded from, or
      otherwise not considered in valuing, the assets or Interests or Companies sold
      or disposed of in the Sale in order to most equitably calculate the profit
      earned by Buyer or the Companies in any such Sale. 

    

    
      
        10

      

      
         

        
          

        

      

      
         

      

    

    SECTION
      5

    CONDITIONS

    

    5.1 
Conditions
      to Each Party's Obligations.
      While
      the parties presently contemplate that the Closing will take place immediately
      upon the execution of this Agreement, if for any reason the Closing is delayed
      and does not occur until some period of time greater than one business day,
      then
      the respective obligations of each party to effect the transactions contemplated
      in this Agreement shall be subject to the satisfaction at or prior to the
      Closing of each of the following conditions, any or all of which may be waived
      by both parties in writing, in whole or in part, to the extent permitted by
      applicable law:

    

    (a)  
      No
      statute, rule, regulation, order, decree or injunction shall have been enacted,
      entered, promulgated or enforced by a governmental entity that prohibits the
      consummation of the transactions contemplated in this Agreement, and no
      proceeding that has a reasonable probability of resulting in such effect shall
      be pending; and

    

    (b)  
      All
      authorizations, consents and approvals required to be obtained prior to
      consummation of the transactions contemplated in this Agreement shall have
      been
      obtained other than the consent from the Arizona Department of Banking regarding
      the change in control of the Company with respect to the Companies’ Arizona
      Commercial Mortgage Banking license, the receipt of which is waived by Buyer.
      

    

    5.2 
Conditions
      to the Obligation of Buyer. Irrespective
      of the timing of the Closing, the obligation of Buyer to effect the transactions
      contemplated in this Agreement is further subject to the satisfaction or waiver
      at or prior to the Closing of the following conditions:

    

    (a)  
      The
      representations and warranties of Seller contained in this Agreement shall
      be
      true and correct at and as of the date hereof and at and as of the Closing,
      as
      if made at and as of such time;

    

    (b)  
      Seller
      shall have performed in all material respects its obligations under this
      Agreement required to be performed by it at or prior to the Closing pursuant
      to
      the terms hereof;

    

    (c)  
      Seller
      shall have caused the Company to distribute all of the following assets to
      one
      or more affiliates other than the Companies:

    

    (i)  
      the
      outstanding membership interests of Charter Facility Funding, LLC and New
      Century Academy Property Management Group, LLC;

    

    (ii)  
      the
      Company’s interests in the Flower Mound, Texas property (“Flower
      Mound”)
      (which
      shall include any property, including cash, received by the Company in any
      sale,
      transfer or any other disposition of Flower Mound or any part thereof, to any
      third party) and the Linton and St. Boniface properties in St. Louis, Missouri;
      and 

    

    
      
        11

      

      
         

        
          

        

      

      
         

      

    

    (iii)  
      the
      Deferred Tax Asset, Current Tax Receivable and Intercompany Receivable set
      forth
      on the Last Balance Sheet.

    

    (d)  
      Seller
      shall have delivered or caused to be delivered to Buyer all of the following
      documents:

    

    (i)  
      Assignments
      by Seller of each of the Lease Purchase Contracts to the Company; 

    

    (ii) 
      a
      Transition Services Agreement between Seller and Buyer in the form of
Exhibit
      B
      hereto;

    

    (iii)
      a
      written
      waiver of the applicable provisions of (A) the November 4, 2005 Severance,
      Separation and Release Agreements between Matrix Bancorp, Inc., Matrix Capital
      Bank, Matrix Bancorp Trading, Inc., First Matrix Investment Services Corp.,
      First Matrix, LLC, ABS School Services, LLC, Matrix Financial Services
      Corporation, Matrix Funding Corp., MTXC Realty Corp., Sterling Trust Company,
      The Vintage Group, Inc., Vintage Delaware Holdings, Inc., the Company, MSCS
      Ventures, Inc., Charter Facilities Funding, LLC, Charter Facilities Funding
      III
      LLC and Community Development Funding I, LLC (collectively, the “Matrix
      Parties”)
      and
      each of Mark Spencer and Richard Schmitz and (B) the November 4, 2005 Retention,
      Separation and Release Agreement between the Matrix Parties and David Kloos,
      with respect to the transactions contemplated hereby, executed by the Matrix
      Parties; 

    

    (iv) 
      a
      certificate duly executed by the chief executive officer of Seller in the form
      of Exhibit
      C;

    

    (v) 
      a
      certificate, duly executed by the secretary of Seller, certifying: (A) a copy
      of
      Seller's Certificate of Incorporation, (B) a copy of Seller's by-laws; (C)
      as to
      the incumbency and signatures of Seller's officers who signed this Agreement
      and
      any document in relation to the transactions contemplated herein; and (D) as
      to
      the limited liability company authorization of the execution, delivery and
      performance of this Agreement and all related agreements, documents and
      certificates; 

    

    (vi) 
      a
      good
      standing certificate, or a copy thereof, relating to Seller and each of the
      Companies issued as of a recent date by the Secretary of State of their state
      of
      incorporation and the Secretary of State of each jurisdiction where each of
      the
      Companies is qualified to do business;

    

    (vii) 
      resignations
      of all officers and managers of the Companies; and

    

    (viii)
      such
      other documents and instruments as Buyer or its counsel may reasonably request
      to carry out the intent of this Agreement.

    

    5.3 
Conditions
      to the Obligation of Seller.
      Irrespective of the timing of the Closing, the obligation of Seller to effect
      the transactions contemplated in this Agreement is further subject to the
      satisfaction or waiver at or prior to the Closing of the following
      conditions:

    

    
      
        12

      

      
         

        
          

        

      

      
         

      

    

    (a)  
      The
      representations and warranties of Buyer contained in this Agreement shall be
      true and correct at and as of the date hereof and at and as of the Closing,
      as
      if made at and as of such time; 

    

    (b)  
      Buyer
      shall have performed in all material respects its obligations under this
      Agreement required to be performed by it at or prior to the Closing pursuant
      to
      the terms hereof;

    

    (c)   
      Buyer
      shall have delivered or caused to be delivered to Seller all of the following
      documents:

    

    (i)  
      Evidence
      of termination or modification acceptable to Seller of the Credit Support
      Agreement between Matrix Bancorp. Inc. and Compass Bank;

    

    (ii)  a
      certificate, duly executed by the Secretary of Buyer, certifying: (A) a copy
      of
      Buyer's Articles of Organization, (B) as to the incumbency and signatures of
      Buyer's officers who are signing any document in relation to the transactions
      contemplated herein; and (C) a copy of resolutions duly adopted by the managers
      of Buyer, authorizing the execution, delivery and performance of this Agreement
      and all related agreements, documents and certificates; 

    

    (iii) 
      a
      good
      standing certificate relating to Buyer issued as of a recent date by the
      Colorado Secretary of State; and

    

    (iv) 
      such
      other documents and instruments as Seller or its counsel may reasonably request
      to carry out the intent of this Agreement.

    

    SECTION
      6

    INDEMNITY
      AND GUARANTY

    

    6.1 
Seller's
      Indemnification Liability.
      Seller
      will indemnify, defend and hold harmless Buyer and its members, managers,
      officers, agents, employees, insurers, attorneys, successors and assigns from
      and against any and all Damages arising out of or resulting from, directly
      or
      indirectly: (i) any breach by Seller of the terms of this Agreement, (ii) any
      misrepresentation or breach of warranty contained in this Agreement, (iii)
      failure to perform any covenant or obligation of Seller under this Agreement,
      or
      (iv) any Excluded Liability.

    

    6.2 
Buyer's
      Indemnification Liability.
      Buyer
      will indemnify, defend and hold harmless Seller and its shareholders, officers,
      managers, directors, agents, employees, insurers, attorneys, successor and
      assigns from and against any and all Damages arising out of or resulting from,
      directly or indirectly: (i) any breach by Buyer of the terms of this Agreement,
      (ii) any misrepresentation or breach of warranty contained in this Agreement,
      or
      (iii) failure to perform any covenant or obligation of Buyer under this
      Agreement, or (iv) the operation or ownership of the Companies following the
      Closing Date other than Excluded Liabilities.

    

    6.3 
Indemnification
      Claims Procedure. 

    

    
      
        13

      

      
         

        
          

        

      

      
         

      

    

    For
      any
      indemnification claim made under Section 6.1 against Seller or under Section
      6.2
      against Buyer, the indemnified party shall give written notice, within 30 days
      of the party's actual knowledge of the claim, to the party potentially liable
      as
      an indemnifying party (referred to in this Section as an "Indemnitor")
      of any
      claim potentially giving rise to any Damages that has arisen or been asserted,
      provided that any failure or delay in giving notice shall not limit the other
      party's indemnity obligations under this Agreement except to the extent that
      such other party is proven to have been prejudiced by such failure or delay.
      The
      notice shall specify in reasonable detail the Damage, the basis for any
      anticipated liability and, if then determinable, the computation of the amount
      of the indemnification claim hereunder.

    

    If
      the
      notice states that a claim has been made by a third party, the Indemnitor may,
      at its option, assume the defense of such claim if it admits its liability
      under
      this indemnity and provides evidence of financial ability to pay reasonably
      satisfactory to the indemnified party. The Indemnitor shall be liable to
      indemnify for any settlement of any such claim, the defense of which has been
      formally accepted by the Indemnitor, if the settlement is effected by the
      indemnified party with the Indemnitor's consent. Any defense of a claim accepted
      by the Indemnitor shall be conducted by counsel of good standing, and at the
      expense of the Indemnitor, except that if any proceeding involves both claims
      against which indemnity is granted hereunder and other claims for which
      indemnity is not granted hereunder, the expenses of defending against such
      claims shall be borne in proportion to the respective dollar amounts of the
      award of damages related to such claims. If no damages are awarded with respect
      to such claims, then expenses shall be shared equally. Each party shall make
      available to the other party and its attorneys and accountants all books and
      records of such party relating to any claim, and the parties agree to render
      to
      each other such assistance as may reasonably be requested to insure the proper
      and adequate defense of any such claim. The indemnified party may be a
      participant in the defense of any claim being defended by the Indemnitor at
      its
      own expense.

    

    6.4 
Limitations.
      A claim
      for indemnification under Section 6.1 must be made against the applicable
      Indemnitor within one year of the date hereof, except that a claim against
      Seller on account of (a) violations of the first two sentences of Section 2.2
      or
      the first three sentences of Section 2.4, (b) any inaccuracies in the principal
      balances shown on the Loan Trial Balance or (c) any Excluded Liability, may
      be
      asserted at any time prior to the expiration of the statute of limitations
      applicable thereto, including any extension thereof agreed to by Buyer and
      Seller. No amounts shall be payable by Seller under Section 6.1 unless and
      until
      the aggregate amount otherwise payable by Seller in the absence of this clause
      exceeds $25,000 (the "Basket"),
      in
      which event Seller shall be liable for all amounts payable under Section 6.1
      (including the first $25,000). In no event shall the amount payable by Seller
      under Section 6.1 exceed $1,000,000 (the "Cap").
      Neither the Cap nor the Basket shall apply to a claim for indemnification
      against Seller based on willful misconduct, fraud, any Excluded Liability,
      a
      claim for breach of any representation or warranty set forth in the first two
      sentences of Section 2.2 or the first three sentences of Section 2.4, any
      inaccuracies in the principal balances shown on the Loan Trial Balance or any
      guaranty claim under Section 6.5. 

    

    6.5 
Loan
      Portfolio Guaranty. 

    

    (a)  
      Seller
      guarantees payment of the loans held by the Company on the Closing Date (the
      “Loan
      Portfolio”),
      which
      loans are listed on Exhibit
      D
      hereto,
      up to an aggregate guaranty of $1,650,000 in the aggregate. In order for Buyer
      to obtain payment from Seller under this guaranty (the “Portfolio
      Guaranty”),
      Buyer
      must provide written notice to Seller of a 

     

    
      
        14

      

      
         

        
          

        

      

      
         

      

    

    payment
      default on a loan held in the Loan Portfolio and offer Seller the opportunity
      to
      repurchase the defaulted loan from Buyer or the Companies. If Seller does not
      repurchase said loan within the 30-day period following delivery of such notice,
      then Buyer may elect to address the default in such manner as it believes to
      reasonable and prudent under the circumstances, and Seller’s liability to Buyer
      under the Portfolio Guaranty for such loan shall include property disposition
      costs and expenses, sales commissions, scheduled interest payments to third
      parties and any other bona fide, fully documented, out-of-pocket expenses
      related to disposing of the loan. The
      Portfolio Guaranty expires on the fifth anniversary of the execution of this
      Agreement (the “Expiration
      Date”),
      except with respect to loans in the Loan Portfolio that are more than 30 days
      delinquent on the Expiration Date, for which loans a claim may continue to
      be
      made until the earlier of (i) the date that 12 consecutive monthly payments
      have
      been made on a timely basis on such loan or (ii) the date of final resolution
      of
      the defaulted loan. 

    

    (b)  
      Seller’s
      Portfolio Guaranty (i) is limited to the loans in the Loan Portfolio listed
      on
Exhibit
      F
      and does
      not cover any new or replacement loans added to the Loan Portfolio after the
      Closing provided, however, if Buyer informs Seller of a defaulted loan under
      Section 6.5(a) and Seller has declines to repurchase such loan and Buyer or
      the
      Companies elect to address the default by restructuring or replacing the
      defaulted loan with a new or modified loan secured by substantially identical
      collateral, then the Portfolio Guaranty shall apply to the new loan as it did
      to
      the defaulted loan up to an amount equal to the principal balance of the
      defaulted loan at the time of the default; (ii) is made only to Buyer and the
      Companies so long as the Companies are owned and controlled by Buyer and Buyer
      is owned and controlled by its current members, and (iii) terminates if and
      to
      the extent that the Loan Portfolio or such loan is transferred, directly or
      indirectly, to any party other than Buyer, the Companies or an entity owned
      and
      controlled by Buyer or Companies, provided, however, that the Portfolio Guaranty
      shall not be terminated if the transfer is a sale and leaseback arrangement
      or
      other similar financing arrangement where the risk of loss from default remains
      with Buyer or the Companies after the transfer. 

    

    SECTION
      7

    MISCELLANEOUS

    

    7.1 
Costs
      and Expenses.
      Each
      party shall be responsible for all costs and expenses incurred by it in
      connection with this Agreement and the consummation of the transactions
      contemplated hereby (including, without limitation, all attorneys' fees and
      costs, all accountants' fees and costs and broker's fees and costs). The
      obligations contained in this Section 8.1 shall survive the termination of
      this
      Agreement.

    

    7.2 
Employees;
      Benefits.
      Effective at the Closing, the Companies shall cease to be participating
      employers in the Benefit Plans. Buyer shall pay Seller the cost of maintaining
      health insurance coverage through COBRA for the employees of the Companies
      who
      elect COBRA coverage until new coverage is available to such employees pursuant
      to a health insurance plan maintained by Buyer 

    

    
      
        15

      

      
         

        
          

        

      

      
         

      

    

    7.3 
Amendment;
      Waiver; Termination. 

    

    This
      Agreement may not be amended except by an instrument in writing signed on behalf
      of each of the parties hereto.

    

    At
      any
      time prior to the Closing, the parties may: (i) extend the time for the
      performance of any of the obligations or other acts of the other parties hereto;
      (ii) waive any inaccuracies in the representations and warranties of the other
      parties contained herein or in any document, certificate or writing delivered
      pursuant hereto; or (iii) waive compliance with any of the agreements or
      conditions of the other parties hereto contained herein. Any agreement on the
      part of any party to any such extension or waiver shall be valid only if set
      forth in an instrument in writing signed on behalf of such party. Any such
      waiver shall constitute a waiver only with respect to the specific matter
      described in such writing and shall in no way impair the rights of the party
      granting such waiver in any other respect or at any other time. Neither the
      waiver by any of the parties hereto of a breach of or a default under any of
      the
      provisions of this Agreement, nor the failure by either of the parties, on
      one
      or more occasions, to enforce any of the provisions of this Agreement or to
      exercise any right or privilege hereunder, shall be construed as a waiver of
      any
      other breach or default of a similar nature, or as a waiver of any of such
      provisions, rights or privileges hereunder.

    

    The
      rights and remedies herein provided are cumulative and none is exclusive of
      any
      other, or of any rights or remedies that any party may otherwise have at law
      or
      in equity.

    

    7.4 
Notices.
      Any
      notice, request, demand, waiver, consent, approval or other communication which
      is required or permitted hereunder shall be in writing. All such notices shall
      be delivered personally, by facsimile (with receipt confirmation) or by
      overnight courier, and shall be deemed given or made when delivered personally,
      the business day sent if sent by facsimile or one business day after delivery
      to
      the overnight courier for next business day delivery. All such notices are
      to be
      given or made to the parties at the following addresses (or to such other
      address as any party may designate by a notice given in accordance with the
      provisions of this Section):

    

    If
      to
      Buyer:

    SKS
      Ventures, LLC

    1377
      Gold
      Mine Lane

    Evergreen,
      CO 80439

    Attention:
      David Kloos

    Facsimile
      No. (303) 526-7792

    

    with
      a
      copy (which shall not constitute notice) to:

    

    Brownstein
      Hyatt & Farber, P.C.

    410
      Seventeenth Street, 22nd Floor

    Denver,
      Colorado 80439

    Attention:
      Jeff Knetsch

    facsimile
      No.: (303) 223-1111 

    

    
      
        16

      

      
         

        
          

        

      

      
         

      

    

    If
      to
      Seller:

    

    Equi-Mor
      Holdings, Inc.

    c/o
      Matrix Bancorp, Inc.

    700
      17th
      Street,
      Suite 2100

    Denver,
      CO 80202

    Attention:
      Theodore J. Abariotes, General Counsel

    Facsimile
      No.: (720) 946-1218 

    

    With
      a
      copy (which shall not constitute notice) to:

    

    Davis
      Graham & Stubbs LLP

    1550
      17th
      Street,
      Suite 500

    Denver,
      Colorado 80202

    Attn:
      S.
      Lee Terry, Jr.

    Facsimile
      No: 303-893-1379

    

    7.5 
Headings.
      The
      headings contained in this Agreement are for reference purposes only and shall
      not affect in any way the meaning or interpretation of this
      Agreement.

    

    7.6 
Counterparts.
      This
      Agreement may be executed in two or more counterparts, each of which shall
      be
      deemed an original but all of which together shall be considered one and the
      same agreement.

    

    7.7 
Entire
      Agreement; Third Party Beneficiaries; Ownership Rights.
      This
      Agreement (including the documents and the instruments referred to herein):
      (i)
      constitutes the entire agreement and supersedes all prior agreements and
      understandings, both written and oral, between the parties with respect to
      the
      subject matter hereof; and (ii) is not intended to confer upon any person other
      than the parties hereto any rights or remedies hereunder.

    

    7.8 
Severability.
      If any
      term, provision, covenant or restriction of this Agreement is held by a court
      of
      competent jurisdiction or other authority to be invalid, void, unenforceable
      or
      against its regulatory policy, the remainder of the terms, provisions, covenants
      and restrictions of this Agreement shall remain in full force and effect and
      shall in no way be affected, impaired or invalidated.

    

    7.9 
Governing
      Law; Venue.
      This
      Agreement shall be governed, construed and enforced in accordance with the
      laws
      of the State of Colorado without giving effect to the principles of conflicts
      of
      law thereof. 

    

    7.10 
Assignment.
      Neither
      this Agreement nor any of the rights, interests or obligations hereunder shall
      be assigned by either of the parties hereto (whether by operation of law or
      otherwise) without the prior written consent of the other party; provided,
      however, that Buyer may assign its rights hereunder to any lender as security
      for providing financing of the transactions contemplated hereby. Subject to
      the
      first sentence of this Section 8.10, this Agreement will be binding upon, inure
      to the benefit of and be enforceable by, the parties hereto and their respective
      successors and assigns.

    

    
      
        17

      

      
         

        
          

        

      

      
         

      

    

    

    IN
      WITNESS WHEREOF, Seller and Buyer have caused this Agreement to be signed by
      their respective officers thereunto duly authorized as of the date first written
      above.

    

    SKS
      VENTURES, LLC

    

    

    By:
      /s/
      D.
      Mark Spencer

         
 D.
      Mark
      Spencer

          
Manager

    

    

    EQUI-MOR
      HOLDINGS, INC.

    

    By: /s/
      Michael J. McCloskey    

          
      Name:
      Michael
      J. McCloskey

          
Title: President

    
      
        18

      

      
         

        
          

        

      

      
         

      

    

    

    GUARANTIES

    

    Guaranty
      of Seller’s Obligations. In
      order
      to induce Buyer to purchase the Interests and enter into the Agreement and
      because it has determined that executing this Guaranty is in its interest and
      to
      its financial benefit as the sole stockholder of Seller, MATRIX BANCORP, INC.
      ("MBI") hereby absolutely and unconditionally guaranties to Buyer, as primary
      obligor and not merely as surety, the performance of all obligations of Seller
      under this Agreement, including but not limited to the full and prompt payment
      of Seller’s indemnification obligations, the Portfolio Guaranty and any other
      payments which the Agreement requires to be made by Seller, when due, whether
      at
      stated maturity, by acceleration or otherwise (the “Seller Liabilities”). MBI
      will not only pay the Seller Liabilities, but will also reimburse Buyer for
      any
      costs and expenses, including reasonable attorney's fees, that Buyer may incur
      in collecting the Seller Liabilities from Seller or MBI, and for enforcing
      this
      Guaranty. 

    

    

    MATRIX
      BANCORP, INC.

    

    

    By: /s/
      Michael J. McCloskey 

    Name:
      Michael
      J. McCloskey 

    Vice
      President

    

    

    Guaranty
      of Buyer’s Obligations. In
      order
      to induce Seller to sell the Interests to Buyer and enter into the Agreement
      and
      because they have each determined that executing this Guaranty is in their
      individual and collective interest and to their individual and collective
      financial benefit as the sole holders of the membership interests of Buyer,
      each
      of RICHARD V. SCHMITZ, DAVID KLOOS and D. MARK SPENCER (collectively
      the “Members” and individually a “Member”) hereby absolutely and unconditionally
      guaranties to Seller, jointly and severally, as primary obligor and not merely
      as surety, the performance of all obligations of Buyer under this Agreement,
      including but not limited to the full and prompt payment of Buyer’s
      indemnification obligations and any other payments which the Agreement requires
      to be made by Buyer, when due, whether at stated maturity, by acceleration
      or
      otherwise (the “Buyer Liabilities”). Each of the Members, or any one Member,
      will not only pay the Buyer Liabilities, but will also reimburse Seller for
      any
      costs and expenses, including reasonable attorney's fees, that Seller may incur
      in collecting the Buyer Liabilities from Buyer, the Members or any Member,
      and
      for enforcing this Guaranty. 

    

    /s/
      Richard V.
      Schmitz                                              

    RICHARD
      V. SCHMITZ

    

    /s/
      David
      Kloos                                                          
 

    DAVID
      KLOOS 

    

    /s/
      D. Mark
      Spencer                                                  

    D.
      MARK SPENCER

     

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    EXHIBIT
      A

    

    Definitions

    

    "Affiliate"
      means,
      with respect to any Person, any other Person who directly or indirectly, through
      one or more intermediaries, controls, is controlled by, or is under common
      control with, such Person. The term "control" means the possession, directly
      or
      indirectly, of the power to direct or cause the direction of the management
      and
      policies of a Person, whether through the ownership of voting securities, by
      Contract or otherwise, and the terms "controlled" and "controlling" have
      meanings correlative thereto. 

    

    "Code"
      means
      the Internal Revenue Code of 1986, as amended from time to time. 

    

    "Contract"
      means
      any contract, lease, license, purchase order, sales order or other written
      agreement, practice or commitment which survives the Closing and is binding
      upon
      a Person or its property.

    

    "Damages"
      means
      any liabilities, assessments, judgments, remediations, diminution in value,
      and
      costs or expenses (including out-of-pocket expenses for reasonable attorneys,
      consultants' and other professional fees) and any direct or indirect,
      consequential or special damages, but excluding punitive damages, except for
      punitive damages payable to a third party. 

    

    "Encumbrance"
      means
      any lien, mortgage, security interest, pledge, charge or encumbrance of any
      nature whatsoever on any property or property interest, including any
      restriction on the use, voting, transfer, receipt of income or other exercise
      of
      any attributes of ownership excluding, however, liens for current taxes not
      yet
      due and payable and minor imperfections of title or encumbrances that would
      not
      reasonably be expected to have a Material Adverse Effect on the property or
      the
      operations thereon.

    "Excluded
      Liabilities"
      means
      liabilities of the Company representing or attributable to (i) any Federal,
      state or local Tax incident to or arising out of the operation of the Business
      up to and including April 30, 2006 or such later date as the transactions
      contemplated by this Agreement become effective; (ii) any Federal, state or
      local Tax or fee incident to or arising out of the negotiation, preparation,
      approval or authorization of this Agreement or any related documents or the
      consummation of the transactions contemplated hereby, including but not limited
      to all fees and expenses payable to attorneys, accountants, auditors or brokers;
      (iii) any liability with respect to the Benefit Plans administered by Seller;
      (iv) any liability related to assets and subsidiaries owned by the Companies
      that will be distributed to Seller or an Affiliate of Seller prior to or at
      Closing; (v) any liabilities with respect to claims by Reliant Energy for
      services provided to 7603 Bellfort Street, Houston, Texas prior to the Closing
      Date; and (vi) any liability in excess of $10,000 related to the Palasota
      Lawsuit over the LTTS broker for Flower Mound. For the avoidance of doubt,
      only
      those liabilities and obligations that appear on the Last Balance Sheet and
      are
      designated as Excluded Liabilities on Schedule 2.6 shall be Excluded Liabilities
      hereunder. 

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    "Law"
      means
      any statute, law, ordinance, regulation, order or rule of any Governmental
      Authority, including those covering environmental, energy, safety, health,
      transportation, bribery, record keeping, zoning, antidiscrimination, antitrust,
      wage and hour, and price and wage control matters, as well as any applicable
      principle of common law.

    

    "Material
      Adverse Effect"
      means a
      material adverse effect on the operations, personnel, results of operations
      or
      financial condition of the Companies, taken as a whole. 

    

    "Person"
      means
      an individual, partnership, corporation, limited liability company, joint stock
      company, unincorporated organization or association, trust, joint venture,
      association or other organization, whether or not a legal entity, or a
      governmental authority. 

    

    "Proprietary
      Rights"
      means
      all patents, trademarks, service marks, copyrights, trade names, software and
      all registrations and applications and renewals for any of the foregoing and
      all
      goodwill associated therewith. 

    

    "Tax(es)"
      means
      any federal, state, local, or foreign income, gross receipts, business taxes,
      taxes on services, license, payroll, employment, excise, transportation, energy,
      severance, stamp, occupation, premium, windfall profits, pollution or
      environmental (including taxes under Section 59A of the Code), custom duties,
      capital stock, franchise, profits, withholding, social security (or similar),
      unemployment, disability, real property, ad valorem, personal property, sales,
      use, transfer, registration, value added, alternative or add-on minimum,
      estimated, or other tax of any kind whatsoever, including any interest, penalty,
      or addition thereto, whether disputed or not, and any amounts payable pursuant
      to the determination or settlement of an audit.

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